TORONTO, Aug. 16, 2021 /PRNewswire/ - Golden Star
Resources Ltd. (NYSE American: GSS) (TSX: GSC) (GSE:
GSR) ("Golden Star" or the "Company") announces the cash
repayment of the 7% convertible debentures which matured on
August 15, 2021 ("the Convertible
Debentures"). The Convertible Debentures were, subject to certain
limitations, convertible into common shares at a conversion rate of
222.2222 per US$1,000 principal
amount of 7% Convertible Debentures at conversion price of
approximately US$4.50 per common
share. The $51.5 million ("m") cash
repayment settles the Convertible Debentures in full, thus removing
the liability from the balance sheet and the risk of equity
dilution. All references herein to "$" are to United States dollars.
The 7% Convertible Debentures were issued in August 2016 for US$65m and prior to maturity US$51.5m were outstanding. Interest on the
Convertible Debentures was payable semi-annually on February 1 and August
1 of each year until maturity on August 15, 2021.
Concurrent with the cash repayment of the Convertible
Debentures, the Company met the conditions precedent for draw-down
of the recently upsized senior secured credit facility with
Macquarie Bank Limited (the "Macquarie Credit Facility"). These
conditions included a minimum cash balance of $35m post repayment of the Convertible Debentures
if the funds drawn from the Macquarie Credit Facility were to be
applied to the cash repayment of the Convertible Debentures.
With these conditions met, the Company drew down on the remaining
$29.2m of available liquidity. As of
the date hereof, the $90m Macquarie
Credit Facility is fully drawn.
Andrew Wray, Chief Executive
Officer of Golden Star,
commented:
"The repayment of the Convertible Debentures is an important
step in the strengthening and progression of our balance sheet over
the last 18 months. This deleveraging event removes the
significantly more expensive facility from our balance sheet and
therefore lowers our cost of capital. It is also positive to see
the Convertible Debentures repaid in cash, with no equity
dilution.
From Q1 2020 to the end of Q2 2021 we successfully halved the
Company's net debt position, while also investing approximately
$80m in the business. This has
repositioned the balance sheet providing an appropriate funding
structure with attractive debt ratios. We therefore look forward to
delivering on the future growth of the Wassa mine with a stronger
balance sheet and significant investment already completed, at the
same time as we are continuing to make good progress on delivering
the operational improvements to support a consistent increase in
production volumes."
Company Profile:
Golden Star is an established
gold mining company that owns and operates the Wassa underground
mine in the Western Region of Ghana, West Africa. Listed on the NYSE
American, the Toronto Stock Exchange and the Ghanaian Stock
Exchange, Golden Star is focused on
delivering strong margins and free cash flow from the Wassa
mine. As the winner of the Prospectors & Developers
Association of Canada 2018
Environmental and Social Responsibility Award, Golden Star remains committed to leaving a
positive and sustainable legacy in its areas of operation.
Statements Regarding Forward-Looking Information
Some statements contained in this news release are
"forward-looking statements" within the meaning of the Private
Securities Litigation Reform Act of 1995 and "forward looking
information" within the meaning of Canadian securities laws and
include but are not limited to, statements and information
regarding the Company's ability to deliver on the future growth of
the Wassa mine. Generally, forward-looking information and
statements can be identified by the use of forward-looking
terminology such as "plans", "expects", "is expected", "budget",
"scheduled", "estimates", "forecasts", "intends", "anticipates",
"believes" or variations of such words and phrases (including
negative or grammatical variations) or statements that certain
actions, events or results "may", "could", "would", "might" or
"will be taken", "occur" or "be achieved" or the negative
connotation thereof. Investors are cautioned that forward-looking
statements and information are inherently uncertain and involve
risks, assumptions and uncertainties that could cause facts to
differ materially. Such statements and information are based on
numerous assumptions regarding present and future business
strategies and the environment in which Golden Star will operate in the future,
including the price of gold, anticipated costs and ability to
achieve goals. Forward-looking information and statements are
subject to known and unknown risks, uncertainties and other
important factors that may cause the actual results, performance or
achievements of Golden Star to be
materially different from those expressed or implied by such
forward-looking information and statements, including but not
limited to: gold price volatility; discrepancies between actual and
estimated production; mineral reserves and resources and
metallurgical recoveries; mining operational and development risks;
liquidity risks; suppliers suspending or denying delivery of
products or services; regulatory restrictions (including
environmental regulatory restrictions and liability); actions by
governmental authorities; the speculative nature of gold
exploration; ore type; the global economic climate; share price
volatility; foreign exchange rate fluctuations; risks related to
streaming agreements and joint venture operations; the availability
of capital on reasonable terms or at all; risks related to
international operations, including economic and political
instability in foreign jurisdictions in which Golden Star operates; risks related to current
global financial conditions including financial and other risks
resulting from the impact of the COVID-19 global pandemic; actual
results of current exploration activities; environmental risks;
future prices of gold; possible variations in mineral reserves and
mineral resources, grade or recovery rates; mine development and
operating risks; an inability to obtain power for operations on
favorable terms or at all; mining plant or equipment breakdowns or
failures; an inability to obtain products or services for
operations or mine development from vendors and suppliers on
reasonable terms, including pricing, or at all; public health
pandemics such as COVID-19, including risks associated with
reliance on suppliers, the cost, scheduling and timing of gold
shipments, uncertainties relating to its ultimate spread, severity
and duration, and related adverse effects on the global economy and
financial markets; accidents, labor disputes and other risks of the
mining industry; delays in obtaining governmental approvals or
financing or in the completion of development or construction
activities; litigation risks; the quantum and timing of receipt of
the proceeds from the sale by the Company of its interest in
Bogoso-Prestea; and risks related to indebtedness and the service
of such indebtedness. Although Golden
Star has attempted to identify important factors that could
cause actual results to differ materially from those contained in
forward-looking information and statements, there may be other
factors that cause results not to be as anticipated, estimated or
intended. There can be no assurance that future developments
affecting the Company will be those anticipated by management.
Please refer to the discussion of these and other factors in
Management's Discussion and Analysis of financial conditions and
results of operations for the year ended December 31, 2020 and in our annual information
form for the year ended December 31,
2020 as filed on SEDAR at www.sedar.com. The forecasts
contained in this press release constitute management's current
estimates, as of the date of this press release, with respect to
the matters covered thereby. We expect that these estimates will
change as new information is received. While we may elect to update
these estimates at any time, we do not undertake any estimate at
any particular time or in response to any particular event.
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SOURCE Golden Star Resources Ltd.