Toronto, Ontario - Atlanta Gold Inc. (TSXV: ATG; OTC Pink: ATLDF) announces that it has completed its previously announced refinancing transaction with Concept Capital Management Ltd. ("CCM") and the private placement of C$550,000 principal amount convertible debentures. Under the terms of the refinancing with CCM, the Company refinanced C$3,250,000 of indebtedness by issuing to CCM US$1.5 million principal amount senior secured notes and a C$1.5 million principal amount convertible debenture. Concurrently with the completion of the refinancing transaction with CCM, the Company completed the private placement of additional convertible debentures in the aggregate principal amount of C$550,000. Proceeds received from this placement will be used for working capital purposes. All of the convertible debentures bear interest of 10% per annum, mature April 1, 2018 and are convertible at the holder's option at a conversion price of C$0.10 per share. The convertible debentures are secured by limited recourse guarantees of the Company's subsidiary, Atlanta Gold Corporation ("AGC"), and by mortgages of AGC's interest in its Atlanta Project. In connection with the private placement of convertible debentures, the Company paid a finder's fee of 192,000 warrants to Golden Capital Consulting Ltd. Each warrant entitles the holder to acquire one common share of the Company at an exercise price of C$0.10 at any time prior to April 1, 2018.
The senior secured notes bear interest of 10% per annum and are secured by the limited recourse guarantee of AGC and by a mortgage of AGC's interest in the Atlanta Project. The senior secured notes mature August 31, 2018 and are repayable in cash installments at the rate of 25%, 35% and 40% on August 31, 2016, 2017 and 2018, respectively. Pursuant to an intercreditor agreement entered into by the lenders, the Company and AGC, the senior secured notes and the convertible debentures and the respective security thereon rank equally.
Pursuant to the refinancing, CCM received an option to purchase 1,567.5 troy ounces of gold at US$1,100 per troy ounce until August 31, 2018, with the option vesting at the rate of 25%, 35% and 40% on August 31, 2016, 2017 and 2018, respectively.
The senior secured notes, the convertible debentures and the common shares issuable on the conversion thereof, are subject to a four-month statutory hold period, which will expire on December 27, 2015.
About the Company
Atlanta Gold Inc. holds through its 100% owned subsidiary, Atlanta Gold Corporation, leases, options or ownership interests in its Atlanta properties which comprise approximately 2,159 acres (8.74 square kilometres) located 90 air kilometers east of Boise, in Elmore County, Idaho. A long history of mining makes Atlanta very suitable for development of new mining projects. The Company is focused on advancing its core asset, Atlanta, towards mine development and production.
For further information contact:
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Atlanta Gold Inc.
Wm. Ernest Simmons
President and CEO
Telephone: (208)-424-3343
Fax: (208) 338-6513
Email: [email protected]
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Atlanta Gold Inc.
Peili Miao
Chief Financial Officer
Telephone: (416) 777-0013
Fax: (416) 777-0014
Email: [email protected]
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CHF Investor Relations
Catherine D. Hume
Chief Executive Officer
Telephone: (416) 868-1079
Email: [email protected]
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