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Contango ORE, Inc. (“Contango,” “CORE” or the “Company”) (NYSE:CTGO) announced today that it had entered into a binding agreement to issue a $20,000,000 unsecured convertible debenture to Queen’s Road Capital Investment, Ltd. (“QRC”). The debenture will be purchased at par. The closing and issuance of the debenture is expected to occur on or prior to April 29, 2022, subject to customary closing conditions. The Company will use the proceeds from the sale of the debenture to fund commitments to its Peak Gold, LLC (Manh Choh) joint venture, the exploration and development at its Lucky Shot properties and for general corporate purposes.
Rick Van Nieuwenhuyse, the Company’s President and CEO, stated:
“Management is pleased to finalize this financing with Queen’s Road Capital. I have known Warren Gilman, the principal of QRC, for a long time and have been impressed with his grasp of the mining sector, particularly for recognizing investment opportunities in quality exploration/development stage companies. We intend to use the proceeds from this financing to fund our share through completion of the feasibility study at our 30% owned Manh Choh project managed by Kinross (70%), as well as our planned underground exploration program at our 100% Owned Lucky Shot project. Both projects are progressing according to plan with Manh Choh in the middle of the NEPA permitting process. The feasibility study is expected to be completed in the second half of 2022. Underground development mining is underway at Lucky Shot and we expect to drill a pilot hole next month to determine where to place the underground drift parallel to and in the footwall of the historically mined Lucky Shot vein. The expl oration drift should be completed by late summer when exploration drilling will start. With strong fundamentals in the gold market, Management is excited to advance our portfolio of high-quality projects in Alaska.”
The Debenture
The debenture will bear interest at 8% per annum, payable quarterly with 6% paid in cash and 2% paid in shares of Contango common stock issued at the market price at the time of payment based on a 20-day volumetric weighted average price ( VWAP). The debenture will be unsecured, with a maturity of four years after issuance. The holder may convert the debenture into Contango …
Full story available on Benzinga.com
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