ASX hopeful Linden Gold Alliance (LGA) has signed a non-binding term sheet to settle its debt owed to listed miner St Barbara (ASX:SBM).
Both companies have signed indicative terms to settle and wind down a secured Second Fortune finance facility by way of a $6 million share payment and $5 million in contingent payments, payable in 2 equal tranches upon 2 growth-related milestones being met, for a total of $11 million.
The debt restructure includes settling all amounts owed to St Barbara.
Under the terms of the debt restructuring, the settlement will occur on or before 31 July 2023 upon the following completion items: a $2,176,000 share payment, with 13.6 million LGA shares to be issued at $0.16 per share, taking St Barbara’s holding in Linden to 19.8%, and an agreement for $5 million in contingent payments payable in cash from Linden to St Barbara.
Commenting on the agreement, Linden Gold Managing Director Andrew Rich says: “We wish to thank St Barbara for re-affirming its support of Linden with the revised Debt Restructure — we look forward to having St Barbara as our major shareholder.
“We expect that transitioning to a debt-free junior producer while continuing our focus on increasing margins and growth will increase the investment proposition of Linden”
We expect that transitioning to a debt-free junior producer while continuing our focus on increasing margins and growth will increase the investment proposition of Linden. We also look forward to continuing our relationship with the Gwalia team under the new ownership of Genesis.”
The company says it is transitioning its ore sale arrangement to Genesis Minerals (ASX:GMD), which is the new owner of Gwalia.
Linden has delivered about 340,000 tonnes of ore yielding 40,000 ounces of gold to Gwalia since production re-started at the Second Fortune mine in April 2021.
Linden Gold is a multi-asset gold producer and developer based in the mineral-rich Goldfields region of Western Australia.
Write to Aaliyah Rogan at Mining.com.au
Images: Linden Gold Alliance