Equinox Gold Announces up to $200 Million in Gold Prepay and Gold Purchase and Sale Arrangements All dollar amounts shown in United States dollars
Equinox Gold Announces up to $200 Million in
Gold Prepay and Gold Purchase and Sale
Arrangements
All dollar amounts shown in United States dollars, unless otherwise indicated.
This is a "designated news release" for the purposes of the Company's prospectus supplement dated
November 21, 2022, to its short form base shelf prospectus dated November 21, 2022.
Vancouver, British Columbia--(Newsfile Corp. - March 28, 2023) - Equinox Gold Corp. (TSX: EQX)
(NYSE American: EQX) ("Equinox Gold" or the "Company") is pleased to announce it has completed a
$140 million gold prepay arrangement. The Company has also signed a non-binding term sheet for an
additional $50 million gold purchase and sale arrangement. These arrangements enhance the financial
flexibility of the Company and provide additional cash liquidity at attractive terms as the Company
continues to fund its 60% interest for construction of the Greenstone Gold Mine, which is on budget and
on track for first gold production in the first half of 2024.
The Gold Prepay Arrangement
Equinox Gold entered into a gold forward sale and prepay arrangement (the "Gold Prepay") with a
syndicate of its existing lenders whereby the Company has received an upfront payment of $140 million,
based on gold forward curve prices averaging approximately $2,170 per ounce, in exchange for equal
monthly deliveries of gold from October 2024 to July 2026 totaling 79,310 ounces. Gold deliveries can
be from production from any of the Company's operating mines and the Gold Prepay can be settled prior
to maturity through accelerated delivery of the remaining deliverable gold ounces. The Company can
increase total proceeds to $150 million through execution of an additional gold prepay on or prior to
June 30, 2023.
The Gold Prepay was executed by ING Capital Markets LLC as lead arranger and includes National
Bank of Canada and Bank of Montreal as additional counterparties.
Gold Purchase and Sale Arrangement
The Company also signed a non-binding term sheet for a gold purchase and sale arrangement with
Sandbox Royalties (the "Sandbox Arrangement") whereby, on closing, the Company will receive a
payment of $50 million from Sandbox Royalties in exchange for monthly deliveries equal to the greater
of: a) 333 gold ounces and b) gold ounces equal to 1.2% of the monthly gold production from
Greenstone Gold Mine (100% basis). Gold deliveries would commence in October 2023 and continue
until a total of 60,000 ounces have been delivered. Sandbox will make ongoing cash payments equal to
20% of the spot gold price for each gold ounce delivered. Gold deliveries can be from production from
any of the Company's operating mines. Equinox Gold will have the option to buy down up to 75% of the
delivery obligation at the then current spot gold price, subject to adjustment for the ongoing payment and
a minimum price per ounce of $2,000. The Sandbox Arrangement can be increased to $75 million on
mutual agreement of Equinox Gold and Sandbox Royalties.
Closing of the Sandbox Arrangement is subject to, among other items, execution of a definitive gold
purchase and sale agreement, any required consent of the Company's lending syndicate and a financing
by Sandbox Royalties. The Sandbox Arrangement will be a related-party transaction as Equinox Gold
currently owns approximately 34% of Sandbox Royalties. More information about Sandbox Royalties is
available at
www.sandboxroyalties.com
, which website and information is not incorporated in, and does
not constitute a part of, this news release.
Equinox Gold Contacts
Greg Smith, President & Chief Executive Officer
Rhylin Bailie, Vice President Investor Relations
Tel: +1 604-558-0560
Email:
Cautionary Notes and Forward-looking Statements
Certain statements made in this news release may constitute forward-looking information under
applicable securities laws. These statements may relate to: the Company's ability to successfully
advance the construction of Greenstone Gold Mine and the timing thereof; the expected timing for first
production at Greenstone Gold Mine; the strength of the Company's balance sheet and the
Company's liquidity and future cash requirements; the Company's expectations regarding production
capabilities and future financial or operating performance; the entry into a binding agreement with
Sandbox Royalties relating to the Sandbox Arrangement; the approval of the Company's lending
syndicate to the Sandbox Arrangement; and Sandbox Royalties' ability to successfully complete any
financing required for the Sandbox Arrangement. Forward-looking statements or information generally
identified by the use of the words "will", "continue", "on track", "on budget" and similar expressions
and phrases or statements that certain actions, events or results "could", "would" or "should", or the
negative connotation of such terms, are intended to identify forward-looking statements and
information. Although the Company believes that the expectations reflected in such forward-looking
statements and information are reasonable, undue reliance should not be placed on forward-looking
statements since the Company can give no assurance that such expectations will prove to be correct.
The Company has based these forward-looking statements and information on the Company's current
expectations and projections about future events and these assumptions include: Equinox Gold's
ability to achieve the production expectations for its respective operations and projects; the
Company's ability to fulfill its delivery obligations under each of the Gold Prepay and the Sandbox
Arrangement; construction at Greenstone Gold Mine being completed and performed in accordance
with current expectations; the negotiation and entry into a binding agreement relating to the Sandbox
Arrangement on terms that are acceptable to the Company;
prices for gold remaining as estimated;
currency exchange rates remaining as estimated; and availability of funds for the Company's projects
and future cash requirements. While the Company considers these assumptions to be reasonable
based on information currently available, they may prove to be incorrect. Accordingly, readers are
cautioned not to put undue reliance on the forward-looking statements or information contained in this
news release.
The Company cautions that forward-looking statements and information involve known and unknown
risks, uncertainties and other factors that may cause actual results and developments to differ
materially from those expressed or implied by such forward-looking statements and information
contained in this news release and the Company has made assumptions and estimates based on or
related to many of these factors. Such factors include, without limitation: fluctuations in gold prices;
operational risks and hazards inherent with the business of mining (including environmental accidents
and hazards, industrial accidents, equipment breakdown, unusual or unexpected geological or
structural formations, cave-ins, flooding and severe weather); the effect of blockades and community
issues on the Company's production and cost estimates; successful relationships between the
Company and its joint venture and Indigenous partners; and those factors identified in the Company's
MD&A dated February 21, 2023 for the year ended December 31, 2022 and its most recently filed
Annual Information Form, copies of which are available on SEDAR at www.sedar.com and on EDGAR
at
www.sec.gov/edgar
. Forward-looking statements and information are designed to help readers
understand management's views as of that time with respect to future events and speak only as of the
date they are made. Except as required by applicable law, Equinox Gold assumes no obligation to
publicly announce the results of any change to any forward-looking statement or information
contained or incorporated by reference to reflect actual results, future events or developments,
changes in assumptions or changes in other factors affecting the forward-looking statements and
information. If Equinox Gold updates any one or more forward-looking statements, no inference
should be drawn that Equinox Gold will make additional updates with respect to those or other forward-
looking statements. All forward-looking statements and information contained in this news release are
expressly qualified in their entirety by this cautionary statement.
To view the source version of this press release, please visit
https://www.newsfilecorp.com/release/160251