VANCOUVER, BC, Jan. 30,
2023 /CNW/ - Bluestone Resources Inc. (TSXV:
BSR) (OTCQB: BBSRF) ("Bluestone" or the "Company") is
pleased to announce that it has extended the term of the previously
announced US$30,000,000 loan (the
"Loan") with Zebra Holdings and Investments S.à.r.l, and Lorito
Holdings S.à.r.l (the "Lender") that was due to expire March 11, 2023 (see March
14, 2022 press release).
The Loan will provide for the drawdown of funds by the Company
in tranches of not less than $1,000,000. Proceeds will be primarily used for
general corporate purposes and to advance the Cerro Blanco gold
project through permit amendment approval.
Peter Hemstead, President and
CEO, commented, "We are pleased to have the continued support from
the Lundin Family as we advance the Cerro Blanco project. With less
than $10M drawn to date, the
extension of the loan provides Bluestone with the necessary funds
to work through the permitting amendment process which is expected
to be completed this year."
In consideration for the Loan, the Company will issue 4,000
common shares per month (pro-rated for partial months) for each
$1,000,000 of the principal amount
outstanding under the Loan from time to time up to March 11, 2024 (the "Maturity Date"), the number
of such common shares to be calculated as of the last day of each
month up to the Maturity Date (the "Additional Shares"). The
issuance of the Additional Shares to the Lender is subject to the
final approval of the TSX Venture Exchange. All Additional Shares
issued to the Lender will be subject to a four-month hold period
under applicable securities law.
As the Lender and its affiliates have beneficial ownership of,
or control or direction over, directly or indirectly, more than 10%
of the common shares of the Company, the issuance of the Additional
Shares will be a "related party transaction" under Multilateral
Instrument 61-101 – Protection of Minority Security holders in
Special Transactions ("MI 61-101"). The issuance of the Additional
Shares will be exempt from the formal valuation requirements of MI
61-101 pursuant to section 5.5(b), as the Company's shares are not
listed on a specified market, and from the minority approval
requirements of MI 61-101 pursuant to sections 5.7(1)(a), as
neither the fair market value of the Additional Shares to be issued
nor the consideration to be received for those shares exceeds 25%
of the Company's market capitalization, and 5.7(1)(f) as the Loan
does not have an equity or voting component and is on reasonable
commercial terms that are not less advantageous to the Company than
if the Loan were obtained from an arm's length party.
About Bluestone Resources
Bluestone Resources is a Canadian-based precious metals
exploration and development company focused on opportunities in
Guatemala. The Company's flagship
asset is the Cerro Blanco Gold Project, a near surface mine
development project located in Southern
Guatemala in the department of Jutiapa. The Company released
the results of a Feasibility Study for the Project, outlining an
asset capable of producing over 300 koz/yr at head grades of +2.0
g/t gold. The Project will produce 2.6 million ounces of gold over
the life of mine at an all-in sustaining cost of $629/oz (as defined per World Gold Council
guidelines, less corporate general and administration costs) over
an initial 14-year mine life. The Company trades under the symbol
"BSR" on the TSX Venture Exchange and "BBSRF" on the OTCQB.
On Behalf of Bluestone Resources Inc.
"Peter Hemstead"
Peter Hemstead | Chief
Executive Officer & Director
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.
Forward Looking Statements
This press release contains "forward-looking information" within
the meaning of Canadian securities legislation and "forward-looking
statements" within the meaning of the United States Private
Securities Litigation Reform Act of 1995 (collectively,
"forward-looking statements"). All statements, other than
statements of historical fact, that address activities, events, or
developments that Bluestone Resources Inc. ("Bluestone" or the
"Company") believes, expects, or anticipates will or may occur in
the future including, without limitation: the use of proceeds from
the Loan; final approval of the TSX Venture Exchange; the estimated
gold production volume per year from the Project; life of mine gold
production amounts; average all-in sustaining costs ("AISC"); and
length of initial mine life.
All forward-looking statements are made based on Bluestone's
current beliefs as well as various assumptions made by Bluestone
and information currently available to Bluestone. Generally, these
assumptions include, among others: the presence of and continuity
of metals at the Cerro Blanco Project at estimated grades; the
availability of personnel, machinery, and equipment at estimated
prices and within estimated delivery times; currency exchange
rates; metals sales prices and exchange rates assumed; appropriate
discount rates applied to the cash flows in economic analyses; tax
rates and royalty rates applicable to the proposed mining
operations; the availability of acceptable financing; the impact of
the novel coronavirus (COVID-19); anticipated mining losses and
dilution; success in realizing proposed operations; and anticipated
timelines for community consultations and the impact of those
consultations on the regulatory approval process.
Forward-looking statements are subject to a number of risks and
uncertainties that may cause the actual results of Bluestone to
differ materially from those discussed in the forward-looking
statements and, even if such actual results are realized or
substantially realized, there can be no assurance that they will
have the expected consequences to, or effects on, Bluestone.
Factors that could cause actual results or events to differ
materially from current expectations include, among other things:
potential changes to the mining method and the current development
strategy; risks and uncertainties related to expected production
rates; timing and amount of production and total costs of
production; risks and uncertainties related to the ability to
obtain, amend, or maintain necessary licenses, permits, or surface
rights; risks associated with technical difficulties in connection
with mining development activities; risks and uncertainties related
to the accuracy of mineral resource estimates and estimates of
future production, future cash flow, total costs of production, and
diminishing quantities or grades of mineral resources; changes in
Project parameters as plans continue to be refined; title matters;
risks associated with geopolitical uncertainty and political and
economic instability in Guatemala;
risks related to global epidemics or pandemics and other health
crises, including the impact of the novel coronavirus (COVID-19);
risks and uncertainties related to interruptions in production;
risks related to Project working conditions, accidents or labour
disputes; the possibility that future exploration, development, or
mining results will not be consistent with Bluestone's
expectations; uncertain political and economic environments and
relationships with local communities and governmental authorities;
risks relating to variations in the mineral content and grade
within the mineral identified as mineral resources from that
predicted; variations in rates of recovery and extraction;
developments in world metals markets; and risks related to
fluctuations in commodity prices and currency exchange rates. For a
further discussion of risks relevant to Bluestone, see "Risk
Factors" in the Company's annual information form for the year
ended December 31, 2021, available on
the Company's SEDAR profile at www.sedar.com.
Any forward-looking statement speaks only as of the date on
which it was made, and except as may be required by applicable
securities laws, Bluestone disclaims any intent or obligation to
update any forward-looking statement, whether as a result of new
information, future events or results, or otherwise. Although
Bluestone believes that the assumptions inherent in the
forward-looking statements are reasonable, forward-looking
statements are not guarantees of future performance, and
accordingly, undue reliance should not be put on such statements
due to their inherent uncertainty. There can be no assurance that
forward-looking statements will prove to be accurate, and actual
results and future events could differ materially from those
anticipated in such statements.
Non-GAAP Financial Performance Measures
The Company has included a non-Generally Accepted Accounting
Principles ("GAAP") measure in this news release that is not
defined under International Financial Reporting Standards ("IFRS"),
being AISC per payable ounce of gold sold. Non-GAAP measures do not
have any standardized meaning prescribed under IFRS and, therefore,
they may not be comparable to similar measures employed by other
companies. The Company believes that these measures, in addition to
measures prepared in accordance with GAAP, provide investors an
improved ability to evaluate the underlying performance of the
Company and to compare it to information reported by other
companies. The non-GAAP measures are intended to provide additional
information and should not be considered in isolation or as a
substitute for measures of performance prepared in accordance with
GAAP. These measures do not have any standardized meaning
prescribed under GAAP, and therefore may not be comparable to
similar measures presented by other issuers.
All-in sustaining costs
The Company believes that AISC more fully defines the total
costs associated with producing gold. The Company calculates
AISC as the sum of refining costs, third party royalties, site
operating costs, sustaining capital costs, and closure capital
costs all divided by the gold ounces sold to arrive at a per ounce
amount. Other companies may calculate this measure differently
as a result of differences in underlying principles and policies
applied. Differences may also arise due to a different definition
of sustaining versus non-sustaining capital.
AISC reconciliation
AISC and costs are calculated based on the definitions published
by the World Gold Council ("WGC") (a market
development organization for the gold industry comprised of
and funded by 18 gold mining companies from around the world). The
WGC is not a regulatory organization.
SOURCE Bluestone Resources Inc.