VANCOUVER, Oct. 25, 2017
/PRNewswire/ - Sandstorm Gold Ltd. ("Sandstorm" or the "Company")
(NYSEAMERICAN: SAND, TSX: SSL) has entered into an agreement to
sell US$18.2 million in debt and
equity securities of Trek Mining Inc. ("Trek Mining") to
Ross Beaty (the "Sale Agreement")
conditional upon the closing of the announced business combination
between Trek Mining, NewCastle Gold Ltd. ("NewCastle") and Anfield
Gold Corp. ("Anfield") (the "Combination"). The combined entity
intends to operate under the name Equinox Gold Corp. ("Equinox
Gold") and will be led by Ross Beaty
as Chairman and Christian Milau as
CEO.
— Sandstorm Agrees to Sell Trek Mining Securities
As part of the Combination between Trek Mining, NewCastle and Anfield, Sandstorm has agreed to sell
US$15.0 million of Trek Mining
convertible debentures and US$3.2
million of Trek Mining shares, at a price of C$1.02 per share, to Ross
Beaty. The Sale Agreement is subject to the closing of the
proposed Combination.
Sandstorm President and CEO, Nolan
Watson commented, "The announced combination between Trek
Mining, NewCastle and Anfield is an encouraging development for
Sandstorm shareholders. Sandstorm has royalties on properties that
will be part of the Equinox Gold entity, and the combined company
will be well financed to advance its assets into production. In
addition, the monetization of a significant portion of our Trek
Mining securities is consistent with our stated plan to sell
non-core assets and use the capital raised to continue growing our
royalty portfolio."
Sandstorm's royalty interests on projects owned by the combined
company will include:
- a 3.0% - 5.0% sliding scale net smelter returns ("NSR") royalty
on the Aurizona project. At gold prices less than or equal to
US$1,500 per ounce, the royalty is a
3% NSR.
- a 2.0% NSR royalty on the Aurizona Greenfields property, an
approximately 180,000 hectare package of exploration ground
adjacent to the Aurizona project. Trek Mining announced an
exploration agreement with AngloGold Ashanti Holdings plc
("AngloGold"), whereby AngloGold may invest US$14 million in exploration to earn a 70%
interest in the Aurizona Greenfields.
- an agreement to purchase 3.3% of the gold produced from the
Koricancha toll mill facility in Peru, at a price of US$100 per ounce.
— Equinox Gold Highlights
Equinox Gold will own two past-producing gold mines, Aurizona in
Brazil and Castle Mountain in
California. A July 2017 feasibility study for Aurizona outlined
the design of an open-pit gold mine producing approximately 136,000
ounces of gold per year on average, with an initial 6.5-year mine
life and significant exploration upside. Initial capital to fund
construction and commissioning is estimated at US$130.8 million with all-in-sustaining costs
estimated at US$754 per
ounce.1 Early works construction has commenced at
Aurizona with first gold pour planned for year-end 2018. On closing
of the Combination, Equinox Gold is expected to have sufficient
resources to fully fund the construction of Aurizona.
In addition to its flagship gold projects, Equinox Gold will
hold a majority interest in an operating gold processing facility
in Peru, and 100% of a
feasibility-stage gold project in Brazil, and a high-grade past-producing gold
project in Canada. Equinox Gold
will also hold 100% of two highly prospective porphyry copper
exploration projects in Ecuador
and Chile and 60% of a porphyry
copper project in Mexico.
The Combination is expected to be structured as a plan of
arrangement under the Business Corporations Act (British Columbia) and, in addition to other
customary closing conditions, is subject to TSX-V and other
regulatory and court approvals or orders. The Combination will need
to be approved by (i) two-thirds of the votes cast by NewCastle and Anfield shareholders at their respective
shareholder meetings and (ii) if required, a simple majority of the
votes cast by NewCastle and
Anfield shareholders at their
respective shareholder meetings, excluding the votes held by
persons as required by Multilateral Instrument 61-101. There is no
regulatory requirement for a meeting of Trek Mining shareholders.
The special meetings of NewCastle
and Anfield are expected to be
held in December 2017. For more
information about the Combination see the press release issued
October 25, 2017 and titled, "Trek
Mining, NewCastle Gold and Anfield Gold Announce Business
Combination to Create Equinox Gold, a Leading Multi-Asset Gold
Company" available on www.sedar.com under the Trek Mining,
NewCastle and Anfield SEDAR
profiles.
Note
1. Based on the "Feasibility Study on the Aurizona Gold Mine
Project" prepared by Lycopodium Minerals Canada Ltd. with an
effective date of July 10, 2017,
which is available for download on SEDAR at
www.sedar.com.
ABOUT SANDSTORM GOLD
Sandstorm Gold Ltd. is a gold royalty company. Sandstorm
provides upfront financing to gold mining companies that are
looking for capital and in return, receives the right to a
percentage of the gold produced from a mine, for the life of the
mine. Sandstorm has acquired a portfolio of 171 royalties, of which
20 of the underlying mines are producing. Sandstorm plans to grow
and diversify its low cost production profile through the
acquisition of additional gold royalties.
For more information visit: www.sandstormgold.com
CAUTIONARY STATEMENTS TO U.S. SECURITYHOLDERS
The financial information included or incorporated by reference
in this press release or the documents referenced herein has been
prepared in accordance with International Financial Reporting
Standards as issued by the International Accounting Standards
Board, which differs from US generally accepted accounting
principles ("US GAAP") in certain material respects, and thus are
not directly comparable to financial statements prepared in
accordance with US GAAP.
Information contained or referenced in this press release or in
the documents referenced herein concerning the properties,
technical information and operations of Sandstorm has been prepared
in accordance with requirements and standards under securities
laws, which differ from the requirements of US securities laws. The
terms "mineral resource", "measured mineral resource", "indicated
mineral resource" and "inferred mineral resource" used in this or
in the documents incorporated by reference herein are mining terms
as defined in accordance with NI 43-101 under guidelines set out in
the Definition Standards for Mineral Resources and Mineral Reserves
adopted by the Canadian Institute of Mining, Metallurgy and
Petroleum Council on 11 December
2005. While the terms "mineral resource", "measured mineral
resource", "indicated mineral resource" and "inferred mineral
resource" are recognized and required by securities laws other than
the requirements of US securities laws, they are not recognized by
the SEC. Disclosure of contained ounces are or may be permitted
disclosure under regulations applicable to Sandstorm; however, the
SEC normally only permits issuers to report resources as in place
tonnage and grade without reference to unit of production measures.
As such, certain information contained in this document or in the
documents incorporated by reference herein concerning descriptions
of mineralization and mineral resources under these standards may
not be comparable to similar information made public by US
companies subject to reporting and disclosure requirements of the
SEC.
CAUTIONARY NOTE REGARDING FORWARD-LOOKING INFORMATION
This press release contains "forward-looking statements", within
the meaning of the U.S. Securities Act of 1933, the U.S. Securities
Exchange Act of 1934, the Private Securities Litigation Reform Act
of 1995 and applicable Canadian securities legislation, concerning
the business, operations and financial performance and condition of
Sandstorm. Forward-looking statements include, but are not limited
to, statements with respect to the future price of gold, the
estimation of mineral reserves and resources, realization of
mineral reserve estimates, and the timing and amount of estimated
future production. Forward-looking statements can generally be
identified by the use of forward-looking terminology such as "may",
"will", "expect", "intend", "estimate", "anticipate", "believe",
"continue", "plans", or similar terminology.
Forward-looking statements are made based upon certain
assumptions and other important factors that, if untrue, could
cause the actual results, performances or achievements of Sandstorm
to be materially different from future results, performances or
achievements expressed or implied by such statements. Such
statements and information are based on numerous assumptions
regarding present and future business strategies and the
environment in which Sandstorm will operate in the future,
including the price of gold and anticipated costs. Certain
important factors that could cause actual results, performances or
achievements to differ materially from those in the forward-looking
statements include, amongst others, gold price volatility,
discrepancies between actual and estimated production, mineral
reserves and resources and metallurgical recoveries, mining
operational and development risks relating to the parties which
produce the gold Sandstorm will purchase, regulatory restrictions,
activities by governmental authorities (including changes in
taxation), currency fluctuations, the global economic climate,
dilution, share price volatility and competition.
Forward-looking statements are subject to known and unknown
risks, uncertainties and other important factors that may cause the
actual results, level of activity, performance or achievements of
Sandstorm to be materially different from those expressed or
implied by such forward-looking statements, including but not
limited to: the impact of general business and economic conditions,
the absence of control over mining operations from which Sandstorm
will purchase gold and risks related to those mining operations,
including risks related to international operations, government and
environmental regulation, actual results of current exploration
activities, conclusions of economic evaluations and changes in
project parameters as plans continue to be refined, risks in the
marketability of minerals, fluctuations in the price of gold,
fluctuation in foreign exchange rates and interest rates, stock
market volatility, as well as those factors discussed in the
section entitled "Risks to Sandstorm" in Sandstorm's annual report
for the financial year ended December 31,
2016 available at www.sedar.com. Although Sandstorm 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. Sandstorm does
not undertake to update any forward looking statements that are
contained or incorporated by reference, except in accordance with
applicable securities laws.
SOURCE Sandstorm Gold Ltd.
