VANCOUVER, March 25, 2015 /PRNewswire/ - Red Eagle Mining
Corporation (TSX-V: RD, OTCQX: RDEMF) is pleased to announce a
US $65,000,000 construction financing
with Orion Mine Finance ("Orion"). The financing
includes a private placement (the "Private Placement") of
common shares ("Shares") and a secured US $60,000,000 credit facility (the "Credit
Facility").
Pursuant to the Private Placement, Red Eagle Mining will issue
Shares in an amount equal to the lesser of US $4,000,000 divided by the US dollar equivalent of
CAD $0.33 on the closing date and
such number of Shares as would result in Orion owning 19.9% of the
issued and outstanding shares. Orion also subscribed for a
first tranche of US $1,000,000 which
closed on February 3, 2015, as previously news released.
Under the terms of the subscription agreement, so long as Orion
owns at least 15% of the issued and outstanding shares, Orion shall
have the right to appoint a director to the board of Red Eagle
Mining and so long as Orion owns at least 5% of the issued and
outstanding shares, Orion shall have the right to participate in
any future equity financings in order to maintain Orion's then
current equity ownership in Red Eagle Mining.
The Credit Facility includes the following key terms:
- Draw down of the Credit Facility is subject to Red Eagle Mining
completing an additional equity financing of at least US
$15,000,000 ("Equity Financing");
- The Credit Facility will have a five year term with a principal
holiday and capitalized interest for up to 18 months from the first
advance;
- Advances under the Credit Facility will bear interest at LIBOR
+7.5%;
- A Production Payment of US $30
per ounce produced is payable on the first 405,000 ounces of gold
produced;
- Granting of 5,000,000 warrants to purchase Shares to Orion
exercisable for a five year term at a strike price determined in
the context of the Equity Financing; and
- Amounts outstanding under the Credit Facility will be secured
against all of Red Eagle Mining's property and assets.
"San Ramon is now fully permitted and close to being fully
financed to meet the planned capital expenditure of US $74 million including contingencies," comments
Ian Slater, Chief Executive
Officer. "Red Eagle is on
track to commence construction by mid-2015 with production in
2016."
Substantially all of the proceeds will be used for development
and construction of the San Ramon Gold Mine. The Shares will
be subject to a four month hold period from the date of
issuance. The closing of the transactions are subject to the
prior approval of the TSX Venture Exchange.
About Orion Mine Finance
The Orion Mine Finance Group is a mining focused business with
approximately $1.8 billion under
management specializing in providing flexible capital investment
solutions to junior mining companies in the base and precious
metals sector. Orion has demonstrated capability in debt,
equity, convertibles, off-take, streaming and royalty
investments.
About Red Eagle Mining
Red Eagle Mining is a well-financed gold exploration and
development company with an experienced mine-development
team. Management is focused on building shareholder value
through discovering and developing gold projects with low costs and
low technical risks in Colombia, a
jurisdiction with prolific historic production but until recently
limited modern exploration. Red Eagle Mining is developing
the 100 km² historic Santa Rosa Gold Project located in the
Antioquia Batholith. Development will initially commence with
the fully permitted San Ramon Gold Mine where a positive
Feasibility Study supports project development. Construction
is scheduled to commence by mid-2015 with production in 2016.
Neither the TSX Venture Exchange nor its Regulation Services
Provider (as that term is defined in the policies of the TSX
Venture Exchange) accepts responsibility for the adequacy or
accuracy of this release. This news release includes
forward-looking statements that are subject to risks and
uncertainties. All statements within, other than statements
of historical fact, are to be considered forward looking.
Although the Company believes the expectations expressed in
such forward-looking statements are based on reasonable
assumptions, such statements are not guarantees of future
performance and actual results or developments may differ
materially from those in forward-looking statements. Factors
that could cause actual results to differ materially from those in
forward-looking statements include market prices, exploitation and
exploration successes, continued availability of capital and
financing, and general economic, market or business conditions.
There can be no assurances that such statements will prove
accurate and, therefore, readers are advised to rely on their own
evaluation of such uncertainties. We do not assume any
obligation to update any forward-looking statements. This news
release does not constitute an offer to sell or a solicitation of
an offer to sell any securities in the United States. The
securities have not been and will not be registered under the
United States Securities Act of 1933, as amended (the "U.S.
Securities Act") or any state securities laws and may not be
offered or sold within the United
States or to U.S. Persons unless registered under the U.S.
Securities Act and applicable state securities laws or an exemption
from such registration is available.
SOURCE Red Eagle Mining Corporation
