Patagonia Gold announces Conversion of Debt into Common Shares

Nachrichtenquelle: globenewswire
20.10.2020, 14:31  |  145   |   |   

VANCOUVER, British Columbia, Oct. 20, 2020 (GLOBE NEWSWIRE) -- Patagonia Gold Corp. (“Patagonia” or the “Company”) (TSXV: PGDC) is pleased to announce that it has entered into an agreement with Tim Hunt to convert an aggregate of US$10 million of outstanding debt into common shares of the Company (the “Debt Conversion”) at a price per share that is equal to $0.30. This price represents a premium of approximately 100% to the closing price of the common shares on the TSX Venture Exchange (the “TSXV”) on October 19, 2020, prior to the parties entering into such agreement.

The debt to be converted in connection with the Debt Conversion includes US$4,821,835 of principal and accrued interest owed to Mr. Hunt by the Company, and US$5,178,165 in accounts payable owed to Mr. Hunt in respect of interest, rent and administration expenses accrued by the Company. Following the Debt Conversion, the balance of the US$1,457,807 in accounts payable owed to Mr. Hunt and a related party to Mr. Hunt in respect of interest, wages, rent and administration expenses is expected to be settled in full by December 10, 2020 by a cash payment in the amount of US$720,397 plus 7% accrued interest.

Christopher van Tienhoven, Chief Executive Officer states, “The Debt Conversion shows a strong support for the long-term growth of the Company and is in line with the Company’s mission of becoming an intermediate mining producer through the acquisition, exploration and development of gold and silver projects in South America.”

Completion of the Debt Conversion is subject to approval of the TSXV and closing is expected to occur within five business days of the receipt of such approval. Upon completion of the Debt Conversion, Tim Hunt, a director of Patagonia, is expected to own or control 97,693,902 common shares in Patagonia, representing a 27% interest in the Company on an undiluted basis.

The Debt Conversion is a “related party transaction” under Multilateral Instrument 61-101 – Protection of Minority Security Holders in Special Transactions (“MI 61-101”) because Tim Hunt is a related party to Patagonia as a director of the Company and a shareholder with an interest of more than 10%. Pursuant to Section 5.5(b) and 5.7(1)(c) of MI 61-101, the Company is exempt from obtaining a formal valuation and approval of the Company’s minority shareholders because the Company’s shares trade on the TSX Venture Exchange and, pursuant to Section 5.5(e) of MI 61-101, the Debt Conversion is supported by Carlos Miguens, the Company’s controlling shareholder.

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Patagonia Gold announces Conversion of Debt into Common Shares VANCOUVER, British Columbia, Oct. 20, 2020 (GLOBE NEWSWIRE) - Patagonia Gold Corp. (“Patagonia” or the “Company”) (TSXV: PGDC) is pleased to announce that it has entered into an agreement with Tim Hunt to convert an aggregate of US$10 million of …

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