BARU GOLD Announces US $1.5 Million Convertible Loan Financing FOR Sangihe GOLD MINE Production
News Release
BARU: TSX.V | BARUF: OTCQB
July 18, 2022
BARU GOLD ANNOUNCES US $1.5 MILLION
CONVERTIBLE LOAN FINANCING
FOR SANGIHE GOLD MINE PRODUCTION
Baru Gold Corp. (“BARU” or the “Company”) is pleased to announce it has entered into
a convertible loan agreement with Mercer Street Global Opportunity Fund, LLC, a fund
managed by Mercer Street Capital Partners, LLC, a Miami -based institutional fund
manager (together, “Mercer”), to raise net proceeds of US$1,500,000 ($1.94 Million
Canadian) to fund the development and construction of the Sangihe gold mine in Indonesia,
and for general working capital.
Terry Filbert, Chairman and CEO of Baru Gold, commented, “The Company’s ability to
raise these funds in this challenging market is a testament to the merits of the Sangihe
project. We are pleased to be able to carry on with construction and production plans; and
we look forward to the commencement of our previously announced drilling program
where we intend to extend and increase the resource base at the Binebase and Bawone
target areas. The additional capital will allow us to work towards the ultimate goal of
sustained cashflow for the Company.”
The convertible loan will raise net proceeds of US$1,500,000 (the “Convertible Loan”)
from the aggregate principal amount of US$2,000,000 subject to an original discount of
approximately 25%. The terms of the convertible loan agreement are as follows: (i) the
outstanding principal obligations and interest shall be calculated monthly, and shall be
repaid to the Subscriber in eighteen (18) equal monthly installments, in advance,
commencing 180 days following the closing date, until the obligations are fully repaid; (ii)
the Company shall pay interest on any overdue amount (including interest on interest) at
and interest rate of 18% per annum until the overdue amounts are paid in full; (iii) in the
event that the principal amount of US$1,500,000 has been fully paid within one (1) year
from the closing date, a discount of approximately 10% of the principal amount and interest
shall apply to the total repayment amount where the aggregate amount due shall be reduced
to US$1,800,000. The Debentures have a maturity date of the 2nd anniversary of t he
closing date and bear an interest rate of 16.67% prepaid from loan proceeds on the closing
date.
Commencing on the four (4) month anniversary of the closing date: (i) the principal of the
Convertible Loan shall be convertible into common shares of the Company at the
conversion price of CDN$0.05/US$0.0384 per common share and (ii) subject to prior TSX
Baru Gold Corporation
9th Floor 1021 West Hastings St
Vancouver, BC V6C 1L6
www.barugold.com
Venture Exchange approval, interest shall be convertible at a conversion price based on the
previous trading day close prior to the announcement of the interest conversion..
A total of 15,000,000 transferable warrants of the Company shall also be issued to the
lender that may be exercised over a two (2) year term having a warrant exercise price of
CDN$0.0675/US$0.05.
The Convertible Loan is secured against the Company’s equity interest in its wholly owned
subsidiary, Sangihe Gold Corporation, that holds through a wholly owned Indonesian
subsidiary, the Company’s interests in the Sangihe Gold Project. The use of proceeds from
the Offering shall be used for the development of the Sangihe Gold Project and general
working capital purposes. There are no finder’s fees payable.
ABOUT SANGIHE GOLD PROJECT
The Sangihe Gold Project (“Sangihe”) is located on the Indonesian island of Sangihe, off
the northern coast of Sulawesi. Sangihe has an existing National Instrument 43- 101
inferred mineral resource of 114,700 indicated and 105,000 inferred ounces of gold, as
reported in the Company's "Independent Technical Report on the Mineral Resource
Estimates of the Binebase and Bawone Deposits, Sangihe Project, North Sulawesi,
Indonesia" (May 30, 2017). Readers are cautioned that mineral resources that are not mineral
reserves do not have demonstrated economic viability. The Company intends to proceed to
production without the benefit of first establishing mineral reserves supported by a feasibility study.
The Company's 70- percent interest in the Sangihe -mineral-tenement Contract of Work
("CoW") is held through PT. Tambang Mas Sangihe (“TMS”). The remaining 30- percent
interest in TMS is held by three Indonesian corporations. The term of the Sangihe CoW
agreement is 30 years upon commencement of the production phase of the project.
The Company intends to proceed to production without the benefit of first establishing
mineral reserves supported by a feasibility study. The Company cautions readers that the
any production decision made by the Company will not be based on a NI 43-101 feasibility
study of mineral reserves that demonstrates economic and technical viability and as such,
there may be involved increased uncertainty and various technological and economic risks
such as the interpretation of drill results; the geology, grade and continuity of mineral
deposits; the possibility that future exploration, development or mining results will not be
consistent with our expectations; commodity and currency price fluctuation; failure to
obtain adequate financing; regulatory, reco very rates, refinery costs, and other relevant
conversion factors, permitting and licensing risks; general market and mining exploration
risks and production and economic risks related to design and engineering, manufacturing,
technological processes and test procedures and the risk that the project's output will not
be salable at a price that will cover the project's operating and maintenance costs.
ABOUT MERCER STREET CAPITAL PARTNERS, LLC
Mercer Street specializes in providing innovative debt and equity investments to publicly- listed
companies across the globe.
ABOUT BARU GOLD CORPORATION
Baru Gold Corporation is a dynamic junior gold developer with NI 43-101 gold resources
in Indonesia, one of the top ten gold producing countries in the world. Based in Indonesia
and North America, Baru’s team of mining and finance professionals boasts exte nsive
experience in starting and operating small-scale gold and coal assets. With strong retail and
institutional shareholder support, Baru is positioned to become Indonesia’s next gold
producer.
Frank Rocca, BAppSc.(Geology), MAusIMM, MAIG, CPI -KCMI, Chief Geologist of
Baru Gold Corp. is the Qualified Person as defined under NI 43-101 who has reviewed and
approves the content of this release.
BARU GOLD CORPORATION
Per: “Terry Filbert”
Terry Filbert, Director
President & CEO
+1-206-890-8285
For investor contacts more information, please contact:
Kevin Shum
Investor Relations
647-725-3888 ext 702
Neither 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.
Certain statements in this News Release, which are not historical in nature, constitute “forward looking statements”
within the meaning of that phrase under applicable Canadian securities law. These statements include, but are not limited
to, statements or information concerning future work programs, results and timing of any work programs, the Company’s
performance or events as of the date hereof. These statements reflect management’s current assumptions and
expectations and by their nature are subject to certain underlying assumptions, known and unknown risks and
uncertainties and other factors which may cause actual results, performance or events to be materially different from
those expressed or implied by such forward looking statements. Those risks include the interpretation of drill results; the
geology, grade and continuity of mineral deposits; the possibility that future exploration, development or mining results
will not be consistent with our expectations; commodity and currency price fluctuation; failure to obtain adequate
financing; regulatory, recovery rates, refinery costs, and other relevant conversion factors, permitting and licensing
risks; general market and mining exploration risks and production and economic risks related to design and engineering,
manufacturing, technological processes and test procedures and the risk that the project’s output will not be salable at
a price that will cover the project’s operating and maintenance costs. Forward-looking statements should not be
construed as investment advice. Readers should perform a detailed, independent investigation and analysis of the
Company and are encouraged to seek independent professional advice before making any investment decision.
Accordingly, readers should not place undue reliance on any forward-looking statement. Except as required by
applicable securities laws, the Company disclaims any obligation to update or revise any forward looking statements to
reflect events or changes in circumstances that occur after the date hereof.