VANCOUVER, BC, Dec. 21,
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") to a maturity date of
March 11, 2025 and announces changes
to the Company's board of directors (the "Board") effective
December 31, 2023.
Debt Facility
The Loan will provide for the drawdown
of funds by the Company in tranches of not less than US$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 ongoing support from
the Lundin Family. The loan extension equips Bluestone with access
to funds to continue to progress the permit amendment and to
continue to explore and evaluate a variety of potential strategic
alternatives to further advance the Cerro Blanco gold project.
Currently US$12 million of the
US$30 million facility is drawn."
In consideration for the Loan, the Company will issue 4,000
common shares per month (pro-rated for partial months) for each
US$1,000,000 of the principal amount
outstanding under the Loan from time to time up to March 11, 2025 (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.
Board of Directors
William
Lamb, Jack Lundin, and
Zara Boldt have resigned from the
Company's board of directors effective as of December 31, 2023. Jill
Donaldson and Joyce Ngo have
been appointed to the Board and Peter
Hemstead, current President, CEO, and director has been
appointed Chair effective December 31,
2023. Additionally, Adam
Lundin will act as a Strategic Advisor to the Company.
Peter Hemstead, President, CEO,
and incoming Chair of the Board, remarked, "Both William and Jack
have recently assumed chief executive officer roles at other Lundin
Group companies. With this in mind, we have taken the opportunity
to renew the Board. I would like to extend a warm welcome to
Jill Donaldson and Joyce Ngo as new members, both of whom will
bring exceptional experience to Bluestone. Additionally,
Adam Lundin will provide advisory
support to the Company, and I look forward to the ongoing guidance
and support from the Lundin family. We extend our thanks to all
resigning directors for their substantial contributions throughout
the years and wish them success in their future endeavours."
Jill Donaldson will be the
Lead Independent Director of the Board.
Jill is a director
of Fireweed Metals Corp. and Chair of the Corporate Governance
Committee and Chair of the Health, Safety, and Sustainability
Committee. Jill is also a director of Prospera Credit Union
and Chair of the Business Transformation Committee. As an
independent director, Jill brings significant governance and
transactional experience as well as risk management experience, a
strategic mindset and financial acumen. Jill is also a
Principal at IWJ Law, Business + Investment Counsel. As a senior
corporate and securities lawyer for over 20 years, Jill has
extensive experience working with boards in mergers and
acquisitions, capital markets, strategic planning and
implementation, governance and stakeholder relations, and
compliance and risk management. Jill obtained her J.D. and a
Bachelor of Commerce from the University of
British Columbia Law. In 2019, Jill obtained her Institute
of Corporate Directors Director Designation and in 2023 obtained
the ESG designation for directors from Competent Boards. Jill is
also active in the community as a director of Canuck Place
Children's Hospice and an external member of the Facilities
Committee of the Board of York House
School.
Joyce Ngo will chair the Audit
Committee.
Joyce is a Chartered Professional Accountant who
has twenty years of professional experience in both public practice
and in public companies. Most recently, she served as CFO of
Josemaria Resources Inc. from 2016 to 2019. Before that, Joyce held
senior executive accounting positions with NGEx Resources Inc. and
was instrumental in the spinouts of both Filo Mining and Josemaria
Resources Inc. from NGEx Resources Inc. into separate public
companies. Joyce spent five years in public accounting with KPMG
LLP and is a graduate of Simon Fraser
University with a Bachelor of Business Administration,
majoring in Accounting and Finance with a minor in Economics. Joyce
also currently serves as a director of Filo Corp.
Stock Option Grant
The Company announces that it is
granting as of December 21, 2023,
pursuant to its stock option plan, an aggregate of 400,000 stock
options to Jill Donaldson and
Joyce Ngo in connection with their
appointment, exercisable at $0.20 per
share for a five-year term.
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 | President,
CEO, and Director of the Board
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 of the Loan; the issuance of shares as
consideration for the Loan; the receipt of required regulatory
approvals, including approval of the TSX Venture Exchange; timeline
of the permit amendment; the grant and terms of the stock options;
projections on returns from the Cerro Blanco gold project (the
"Project"); 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 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 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:
risks related to increasing community opposition to the Project and
its effect on permitting and Project timelines; 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 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; risks related to
fluctuations in commodity prices and currency exchange rates;
environmental hazards and infrastructure; compliance with
government laws and regulations, including anti-corruption laws,
and associated costs of compliance; tax risks; reliance on third
parties and risks associated with having foreign subsidiaries;
risks associated with having a limited operational history; risks
related to substantial capital requirements; acquisition risk;
future sales or issuances of common shares; risks related to
competition and dependence on key personnel; risks related to
conflicts of interest; uninsurable risks; risks related to changes
in climate conditions; risks related to control persons;
information technology security risks; litigation risk;
geopolitical risks and conflict; and inflation. 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, 2022, available on the
Company's SEDAR+ profile at www.sedarplus.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.