US$1.5 Million Loan Gabriel Resources Ltd. (TSXV: GBU - “Gabriel” or the “Company”) is pleased to announce that it has entered into definitive agreements with certain shareholders in connection with short-term unsecured loans (“Loans”)
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PRESS RELEASE
FOR IMMEDIATE RELEASE
NOT FOR DISTRIBUTION TO U.S. NEWSWIRE SERVICES OR DISSEMINATION IN THE UNITED STATES
November 29, 2024
US$1.5 Million Loan
Gabriel Resources Ltd. (TSXV: GBU - “Gabriel” or the “Company”) is pleased to announce that it has entered
into definitive agreements with certain shareholders in connection with short-term unsecured loans (“Loans”)
to provide an aggregate US$1.5 million of funding.
The Company is in a critical financial condition and required an immediate infusion of short-term working capital
to sustain its annulment challenge to the March 2024 decision of the ICSID Tribunal and to fund its immediate
operations. The Company believes that the Loans are fundamental to its ability to complete a further funding
round through a proposed private placement of securities (the “Proposed Financing”) in the near future, which
will substantially improve Gabriel’s balance sheet and allow it to finance its critical operational costs.
The Loans will be unsecured but rank senior to any unsecured indebtedness of the Company, will bear interest
at a rate of 12% per annum and will mature on the earlier of: (i) the first anniversary of the date of the Loans;
(ii) the date which is five business days following the completion of the Proposed Financing; or (iii) upon the
occurrence of an Event of Default (as such term is defined in the Loan agreements, including a failure to
complete a US$3 million fundraising by March 31, 2025). It is anticipated that the Loans will be repaid from the
proceeds of the Proposed Financing, the terms of which are under consideration and, if launched, Gabriel may
seek up to US$4 million from investors in connection therewith. The Proposed Financing, if implemented, will
be subject to the approval of the TSXV and receipt of all necessary corporate and regulatory approvals. T here
can be no assurance that sufficient additional financing will be available to the Company at any time or, if
available, that it can be obtained on terms and timing satisfactory to the needs of the Company .
The Loans have been made available by three of Gabriel’s principal shareholders, Electrum Global Holdings
LP (“Electrum”), Swiss Capital S.A. (“Swiss Capital”) and Paulson & Co (“Paulson & Co” and, collectively with
Electrum and Swiss Capital, the “ Lenders”), who have each indicated a willingness to participate in the
Proposed Financing.
Due to the participation of insiders, the Loans constitute “related party transactions ” within the meaning of
Multilateral Instrument 61-101 – Protections of Minority Security Holders in Special Transactions (“Regulation
61-101”). However, the Company’s Board (including all independent members of the Board who are free from
interest in the Loans and unrelated to the Lenders) has determined that Gabriel is in serious financial difficulty,
the Loans are designed to improve the financial condition of the Co mpany, and the terms of the Loans are
reasonable in the Company ’s circumstances Accordingly, the Company is relying on the exemption from the
formal valuation and minority shareholder approval requirements contained in Regulation 61- 101 on the basis
of the “financial hardship” exemption therein.
The Company expects to file a material change report in respect of the related party transaction less than 21
days prior to the execution of the lending agreements , which the Company deems reasonable in the
circumstances so as to be able to avail itself of the proceeds of the Loans in an expeditious manner.
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For information on this press release, please contact:
Dragos Tanase
President & CEO
Richard Brown
Chief Financial Officer
Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in policies of the TSX Venture
Exchange) accepts responsibility for the adequacy or accuracy of this release.
Further Information
About Gabriel
Gabriel is a Canadian resource company listed on the TSX Venture Exchange. The Company’s principal business has been the
exploration and development of the Roșia Montană gold and silver project in Romania, one of the largest undeveloped gold deposits
in Eu rope. Upon obtaining the License in June 1999, the Group focused substantially all of their management and financial
resources on the exploration, feasibility and subsequent development of the Roşia Montană Project. An extension of the exploitation
license for the Roşia Montană Project (held by Roșia Montană Gold Corporation S.A., a Romanian company in which Gabriel owns
an 80.69% equity interest, with the 19.31% balance held by Minvest Roșia Montană S.A., a Romanian state-owned mining company)
was rejected by the competent authority in late June 2024.
Forward-looking Statements
This press release contains “forward-looking information” (also referred to as “forward-looking statements”) within the meaning of
applicable Canadian securities legislation. Forward-looking statements are provided for the purpose of providing information about
management’s current expectations and plans and allowing investors and others to get a better understanding of the Company’s
operating environment. All statements, other than statements of historical fact, are forward-looking statements.
In this press release, forward-looking statements are necessarily based upon a number of estimates and assumptions that, while
considered reasonable by the Company at this time, are inherently subject to significant business, economic and competitive
uncertainties and contingencies that may cause the Company’s actual financial results, performance, or achievements to be
materially different from those expressed or implied herein.
Some of the material factors or assumptions used to develop forward- looking statements include, without limitation, the
uncertainties associated with: the annulment challenge to the March 8, 2024 decision of the ICSID tribunal (the “Arbitral Decision”);
future actions taken by the Romanian Government, including in relation to the enforcement of the costs order granted under the
Arbitral Decision (the “Costs Order”); conditions or events impacting the Company’s ability to fund its operations (including but not
limited to the completion of the potential financing referred above); and the overall impact of misjudgments made in good fai th in
the course of preparing forward-looking information.
Forward-looking statements involve risks, uncertainties, assumptions, and other factors including those set out below, that may
never materialize, prove incorrect or materialize other than as currently contemplated which could cause the Company’s results to
differ materially from those expressed or implied by such forward-looking statements.
Any statements that express or involve discussions with respect to predictions, expectations, beliefs, plans, projections, objectives,
assumptions or future events or performance (often, but not always, identified by words or phrases such as “expects”, “is expected”,
“is of the view”, “anticipates”, “believes”, “plans”, “projects”, “estimates”, “assumes”, “intends”, “strategy”, “goals”, “ob jectives”,
“potential”, “possible” or variations thereof or stating that certain actions, events, conditions or results “may”, “could”, “would”,
“should”, “might” or “will” be taken, occur or be achieved, or the negative of any of these terms and similar expressions) ar e not
statements of fact and may be forward-looking statements.
Numerous factors could cause actual results to differ materially from those in the forward- looking statements, including without
limitation:
• the duration, costs, process and outcome of the ICSID annulment proceedings;
• access to additional funding to support the Group’s strategic objectives;
• the impact on the Company’s financial condition and operations of the rejection of the extension of the Rosia Montana
exploitation license and/or any actions taken by Romania to enforce the Costs Order;
• the impact on financial condition, business strategy and its implementation in Romania of: any allegations of historic acts o f
corruption, uncertain fiscal investigations, uncertain legal enforcement both for and against the Group, unpredictable
regulatory or agency actions and political and social instability;
• changes in the Group’s liquidity and capital resources;
• equity dilution resulting from the conversion or exercise of new or existing securities in part or in whole to Common Shares;
• the ability of the Company to maintain a continued listing on the Exchange or any regulated public market for trading securities;
• Romania’s actions following inscription of the “Roşia Montană Mining Landscape” as a UNESCO World Heritage site;
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• regulatory, political and economic risks associated with operating in a foreign jurisdiction including changes in laws,
governments and legal and fiscal regimes;
• global economic and financial market conditions, including inflation risk;
• the geo-political situation and the resulting economic developments arising from the unfolding conflict and humanitarian crisis
as a consequence of conflicts such as the Russia-Ukraine war;
• volatility of currency exchange rates; and
• the availability and continued participation in operational or other matters pertaining to the Group of certain key employees
and consultants.
This list is not exhaustive of the factors that may affect any of the Company’s forward-looking statements.
Investors are cautioned not to put undue reliance on forward-looking statements, and investors should not infer that there has been
no change in the Company’s affairs since the date of this press release that would warrant any modification of any forward-looking
statement made in this document, other documents periodically filed with or furnished to the relevant securities regulators o r
documents presented on the Company’s website. All subsequent written and oral forward- looking statements attributable to t he
Company or persons acting on its behalf are expressly qualified in their entirety by this notice. The Company disclaims any i ntent
or obligation to update publicly or otherwise revise any forward -looking statements or the foregoing list of assumptions or factors,
whether as a result of new information, future events or otherwise, subject to the Company’s disclosure obligations under applicable
Canadian securities regulations. Investors are urged to read the Company’s filings with Canadian securities regulatory agencies
which can be viewed online at www.sedarplus.ca.
ENDS