New Talisman Gold Mines Limited announced today that it has accepted an offer of a structured financing facility for the Talisman Mine project. The terms of the acceptance letter signed by NTL provide for A$1.6M of an A$2M converting note facility to be advanced subject to satisfaction of certain conditions, including entering into satisfactory security and other facility documentation. The converting note provides for NTL at its sole discretion to either:
1) Upon repayment of 30% of the loan Convert 70% of the loan to equity at the end of the 12 month period, or
2) Repay the loan in full, or
3) Upon repayment of 30% of the loan, roll the loan over the remaining 70% for a further 12 month term.
The funds drawn down from this facility will be applied to the Talisman mine bulk sampling project and working capital requirements. NTL anticipates the $1.6M will be sufficient capital to allow NTL to initiate the bulk sampling program outlined to shareholders at the 2013 AGM. The bulk sampling project provides for the first cash flows from New Talisman’s mining operations and will allow NTL to be cashflow positive within 12 months from the start of bulk sampling operations which are expected to begin in the second half of 2014.
Under the terms of the accepted offer NTL expects to be in a position to execute documentation and have access to the funds within 30 days. NTL will announce the detailed terms of the facility once documentation has been executed.
Executive Director Matthew Hill said, “In a very difficult climate for junior miners’ particularly gold-related juniors, NTL is particularly pleased to have been able to attract an offer to finance the development of the Talisman mine through to first production. It is an indication of the very attractive investment proposition the Talisman mine represents. We remain on track to reopen the Talisman Mine; historically a highly productive, high grade gold mine in one of the most productive gold mining areas in NZ and our transition from developer to producer status is nearly complete. We are mindful that our shareholders have indicated a strong interest to participate in the funding of Talisman and the board is currently reviewing options to allow such participation.”