Zijin Mining Group Co., Ltd. issues $50 million USD loan to Continental Gold Inc. to advance construction of the Buriticá Project in Colombia

In February 2020, an affiliate of Zijin Mining Group Co., Ltd. issued a $50 million USD unsecured loan to Canada-incorporated Continental Gold Inc. to advance the construction of the Buriticá Project in Colombia. The loan was to be advanced in up to three tranches. The first $25 million USD tranche was to be funded prior to closing of a previously-announced plan of arrangement involving Continental Gold Inc., Zijin Mining Group and 2727957 Ontario Inc. and used to advance the construction and commissioning of the Buriticá Project. The second advance of up to USD $25 million was to be funded immediately prior to closing of the transaction and used to pay closing costs. Any amount not advanced as part of the first or second tranche was to be advanced to Continental Gold Inc. in a third and final tranche. The loan is unsecured, repayable on the fifth anniversary date of closing and bears interest at 10% per annum with quarterly interest payments. The loan's maturity date was to be accelerated in certain circumstances, including in the event Continental Gold Inc.’s senior secured facility was terminated. The loan was also subject to an early repayment fee of 2.5% and, following an event of default, would incur interest at an additional 5% per annum. As previously disclosed, the transaction provided for the acquisition of the issued and outstanding common shares of Continental Gold Inc. by way of a statutory plan of arrangement under the Business Corporations Act (Ontario). This loan was planned to be closed in the first quarter of 2020, subject to obtaining the Canadian Investment Act approval and the Chinese State Administration of Foreign Exchange (SAFE) registration. Following closing of the loan, the common shares will be de‑listed from the Toronto Stock Exchange and will not be available for trading on the Toronto Stock Exchange or the OTCQX International.

Additional details

1. As of August 2023, any closing regarding this loan has yet to be confirmed. This issue warrants further investigation.

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