Nordic amends gold purchase agreement with PFL Raahe
TSX-listed Nordic Gold Corporation said on Thursday that it had agreed to amend certain terms in the November 2017 pre-paid forward gold purchase agreement with PFL Raahe Holdings.
The agreement provided Nordic with $20.6-million to restart the Laiva gold mine, in Finland.
A section of the agreement, which has been removed, allowed PFL to elect, in lieu of delivery of up to 24 000 oz of gold – from the restart of Laiva, to exchange such gold delivery into up to 270-million common shares of Nordic, in increments of 100 oz of gold equal to 1.1-million shares.
This had been subject to PFL restricting such exercise at any time such that it would not, following exercise, own more than 20% of Nordic shares.
In return for the section removal, PFL will be granted a 2.5% net smelter return on gold production from the Laiva mine; it will be issued 36.5-million shares, which represent 19.99% of Nordic shares; and Nordic will pay PFL $1.5-million within six months of entering into a definitive amendment to the agreement.
Further, assuming the currently planned private placement to raise up to C$10-million in gross proceeds is successful, PFL will be issued a ‘top-up” number of common shares and the price in upside participation will be lowered from $1 234/oz to $1 200/oz.
Nordic intends to complete a private placement to raise up to C$10-million in gross proceeds, through the issue of units consisting of one share and a full warrant, at C$0.15 apiece.
Each warrant forming part of the units is expected to be exercisable for 24 months at C$0.20 apiece and will contain an early acceleration clause if the common shares trade above C$0.60 for 30 consecutive days.
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