Claude Resources Secures Debt Financing with Canadian Western Bank and Crown Capital Partners Inc.
TSX – CRJ
NYSE MKT – CGR
SASKATOON, Jan. 17, 2013 /PRNewswire/ – Claude Resources Inc. (TSX-CRJ; NYSE MKT-CGR) (“Claude” and or the “Company”) today reported that it has expanded its
current debt facilities with its existing bank, Canadian Western Bank
(“CWB”) and, in addition, has come to an agreement with Crown Capital
Partners Inc. (“CCP”) for a debt facility of $25 million.
CWB Financing Summary
The Company has expanded its current debt facilities to $25 million, of
which $8.6 million is currently drawn. The current $8.6 million
consists of leases, demand loans and a line of credit. The debt
expansion is structured as follows:
Facility Previous Amount Current Amount Line of Credit $5,000,000 $10,000,000 Leases/Demand Loans $7,000,000 $10,000,000 Revolving Loan NIL $5,000,000
Interest rates are both fixed and floating and carry a weighted average
rate of approximately 4.5 percent.
CCP Financing Summary
The CCP offering consists of a five (5) year $25 million debt facility
which carries an interest rate of 10 percent of the outstanding
principal, compounded and payable monthly. Principal payments, due to
begin in 2014, are payable monthly. The facility includes 5.75 million
warrants at a strike price of $0.70 and can be exercisable at any time
from the closing of the transaction to 5 years following the closing of
the transaction. The issuance of warrants is subject to approval from
each of the Toronto Stock Exchange and the New York Stock Exchange.
Closing of the CCP financing is subjective to customary conditions
Principal Repayment Terms
Period Monthly Amount Annual Amount Months 1 - 12 NIL NIL Months 13 - 59 $300,000 $3,600,000 Due at Maturity $10,900,000
Months Following Closing Prepayment Fee Months 13 - 24 2% Months 25 - 36 1% Months 37 - 60 0%
Neil McMillan, President and CEO, stated, “We are pleased to have both
CWB and Crown Capital demonstrating their confidence and support of our
business plan. We are satisfied with our blended cost of capital of
approximately 8 percent. It represents the confidence our debt
providers have in our ability to manage and retire the debt upon
maturity. Our track record over the past 21 years has certainly helped
us build a good relationship with CWB and Crown. The Company expects to
be able to grow the Seabee Gold Operation production by 10 to 15
percent compounded annually over the next 5 years and we are happy to
have CWB and Crown as partners in that growth.”
Use of Proceeds
The Company believes that its new capital structure will advance the
Company over the long term without penalizing shareholders through
major equity financings. The new debt facilities are intended for the
retirement of the $9.8 million debenture due in May 2013, for expansion
capital at the Seabee Gold Operation and for general working capital
purposes. The Company is confident that it can efficiently service and
repay the debt facilities through growing operating cash flows from the
Seabee Gold Operation.
About Claude Resources Inc.
Claude Resources Inc. is a gold producer with shares listed on both the
Toronto Stock Exchange (TSX-CRJ) and the NYSE MKT (NYSE MKT-CGR). The
Company is also engaged in the exploration and development of gold
mineral reserves and mineral resources. The Company’s entire asset base
is located in Canada. Its main revenue generating asset is the 100
percent owned Seabee Gold Project, located in northern Saskatchewan.
Since 1991, Claude has produced over 1,010,000 ounces of gold from the
Seabee Gold Project. Claude also owns 100 percent of the Madsen
property near Red Lake, Ontario and 100 percent interest in the Amisk
Gold Property in northeastern Saskatchewan.
About Canadian Western Bank
Canadian Western Bank (TSX: CWB) is the largest publicly traded Canadian
bank headquartered in Western Canada. CWB and its operating affiliates,
which are together known as Canadian Western Bank Group, offer a
diversified range of financial services through 41 banking branches,
eight trust locations, two centralized insurance offices, a focused
commercial equipment leasing centre and one wealth management location.
About Crown Capital Partners Inc.
Crown Capital Partners is a leading provider of growth capital to middle
market companies throughout Canada. Crown Capital Partners focuses on
providing specialized financing solutions including structured equity,
subordinated term, and bridge loans for acquisitions, management
buy-outs, growth financings and recapitalizations.
CAUTION REGARDING FORWARD-LOOKING INFORMATION
All statements, other than statements of historical fact, contained or
incorporated by reference in this news release and constitute
“forward-looking information” within the meaning of applicable Canadian
securities laws and “forward-looking statements” within the meaning of
the United States Private Securities Litigation Reform Act of 1995
(referred to herein as “forward-looking statements”). Forward-looking
statements include, but are not limited to, statements with respect to
the successful closing of the transaction and expected use of funds
under the new debt facilities, the future price of gold, the estimation
of mineral reserves and resources, the realization of mineral reserve
estimates, the timing and amount of estimated future production, costs
of production, capital expenditures, costs and timing of the
development of new deposits, success of exploration activities,
permitting time lines, currency exchange rate fluctuations,
requirements for additional capital, government regulation of mining
operations, environmental risks, unanticipated reclamation expenses,
title disputes or claims and limitations on insurance coverage.
Generally, these forward-looking statements can be identified by the
use of forward-looking terminology such as “plans”, “expects” or “does
not expect”, “is expected”, “budget”, “scheduled”, “estimates”,
“forecasts”, “intends”, “anticipates” or “does not anticipate” or
“believes”, or the negative connotation thereof or variations of such
words and phrases or state that certain actions, events or results,
“may”, “could”, “would”, “might” or “will be taken”, “occur” or “be
achieved” or the negative connotation thereof.
All forward-looking statements are based on various assumptions,
including, without limitation, the expectations and beliefs of
management, the satisfaction of closing conditions for the transaction
and receipts necessary approvals, the assumed long-term price of gold,
that the Company will receive required permits and access to surface
rights, that the Company can access financing, appropriate equipment
and sufficient labour, and that the political environment within Canada
will continue to support the development of mining projects in Canada.
Forward-looking statements are subject to known and unknown risks,
uncertainties and other factors that may cause the actual results,
level of activity, performance or achievements of Claude to be
materially different from those expressed or implied by such
forward-looking statements, including but not limited to: actual
results of current exploration activities; environmental risks; future
prices of gold; possible variations in ore reserves, grade or recovery
rates; mine development and operating risks; accidents, labour issues
and other risks of the mining industry; delays in obtaining government
approvals or financing or in the completion of development or
construction activities; and other risks and uncertainties, including
but not limited to those discussed in the section entitled “Business
Risk” in the Company’s Annual Information Form. These risks and
uncertainties are not, and should not be construed as being,
Although Claude has attempted to identify important factors that could
cause actual results to differ materially from those contained in
forward-looking statements, there may be other factors that cause
results not to be as anticipated, estimated or intended. There can be
no assurance that such statements will prove to be accurate, as actual
results and future events could differ materially from those
anticipated in such statements. Accordingly, readers should not place
undue reliance on forward-looking statements.
Forward-looking statements in this news release are made as of the date
of this news release and accordingly, are subject to change after such
date. Except as otherwise indicated by Claude, these statements do not
reflect the potential impact of any non-recurring or other special
items that may occur after the date hereof. Forward-looking statements
are provided for the purpose of providing information about
management’s current expectations and plans and allowing investors and
others to get a better understanding of our operating environment.
Claude does not undertake to update any forward-looking statements that
are incorporated by reference herein, except in accordance with
applicable securities laws.
SOURCE CLAUDE RESOURCES INC.