Core Gold Provides an Update on Restructuring of Titan Minerals Debt
VANCOUVER, British Columbia, Jan. 07, 2020 (GLOBE NEWSWIRE) — Core Gold Inc. (“Core Gold” or the “Company“) (TSXV: CGLD, OTCQX: CGLDF) has entered into amending agreements with Titan Minerals Limited (“Titan Minerals”) to further amend the terms of the US$2,500,000 principal amount of debt owing by the Company to Titan Minerals that came due and payable on March 31, 2019.
As previously announced on October 25, 2019, Titan Minerals provided to Core Gold on September 13, 2019 notice that the US$2,500,000 principal amount of debt owing by the Company had been assigned to Titan Minerals effective August 21, 2019. This debt is comprised of (i) promissory notes issued by Core Gold in the aggregate principal amount of US$1.5 million and incurring interest at 12% per annum, payable monthly (the “Promissory Notes“) and (ii) convertible promissory notes issued by Core Gold in the aggregate principal amount of US$1 million and incurring interest at 12% per annum, payable monthly (the “Convertible Notes“, and together with the Promissory Notes, the “Debt“). The Debt is secured by a pledge of all of the issued and outstanding capital of the Company’s wholly-owned subsidiary, Elipe S.A.As announced on August 21, 2019, Core Gold and the original holder of the Debt, in August, 2019 agreed to amendments (collectively, the “August 2019 Amendments“) that would extend the maturity date of the Promissory Notes from March 31, 2019 to March 31, 2021 and the maturity date of the Convertible Notes from March 31, 2019 to March 31, 2020, reduce the conversion price of the Convertible Notes from CAD$0.30 per share to CAD$0.18 per Core Gold common share and remove certain restrictions on the transfer of the Promissory Notes. The August 2019 Amendments were conditional upon the TSX Venture Exchange (the “TSXV“) approving the amendments to the Convertible Notes. While the TSXV initially approved the amendments of the Convertible Notes it rescinded its approval following notification received on September 13, 2019 that the Convertible Notes had previously been transferred to Titan Minerals. The TSXV has still not approved the amendments to the Convertible Notes contemplated by the August 2019 Amendments. Accordingly, the Debt remained unamended with maturity dates of March 31, 2019.Core Gold has entered into agreements with Titan Minerals on January 6, 2020 (the “January 2020 Amending Agreements“) pursuant to which the August 2019 Amendments have been terminated and cancelled and the Debt has been amended as follows (collectively, the ” January 2020 Amendments“):The maturity date of the Promissory Notes has been extended from March 31, 2019 to March 31, 2020;The maturity date of the Convertible Notes has been extended from March 31, 2019 to March 31, 2020;The conversion option of the Convertible Notes expired on March 31, 2019, as a result the previously convertible Convertible Notes are now straight loans without any conversion features attached; andThe restrictions on transfer of the Promissory Notes have been removed.The Convertible Notes are no longer convertible as a result of the January 2020 Amendments. Accordingly TSXV approval of the January 2020 Amendments is not required.About Core Gold Inc.