G Mining Ventures Announces US$481 million Financing Package for Tocantinzinho Gold Project
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July 18, 2022 TSXV: GMIN
OTCQX: GMINF
G Mining Ventures Announces US$481 million Financing Package for
Tocantinzinho Gold Project
All amounts are in US dollars unless stated otherwise
o Tocantinzinho Gold Project financed for construction
o Existing cash on hand and committed capital from financing package totals over $535 million providing
an estimated $81 million in cash and contingency
o Continued support from Eldorado Gold via participation in equity financing
o Franco-Nevada providing a $353 million full financing solution including stream, debt, and equity
o La Mancha becoming strategic investor and long term partner who will hold 25.0% of common shares
o Project early works on budget and nearing completion enabling full construction to commence in Q3-
22
o Detailed engineering and procurement phase progressing in-line with Feasibility Study estimates
BROSSARD, QC, July 18, 2022 – G Mining Ventures Corp. (“GMIN” or the “ Corporation”) is pleased to
announce that the Corporation has entered into binding commitments with respect to a comprehensive
construction financing package totaling $481 million for the development and construction of its 100%
owned Tocantinzinho Gold Pr oject (“TZ” or the “ Project”). The Project remains on track to achieve
production in the second half of 2024. Securing financing on schedule, despite a volatile market
environment, represents a strong statement of support for the management team, as well as the technical
and economic merits of the Project.
Financing Package Highlights - $481 million
o $116 million equity financing via a private placement with strategic investors (the “Strategic Investors”)
priced at C$0.80 per common share
o $68.8 million investment by La Mancha Investments S.à r.l. (“La Mancha”)
o $27.5 million investment by Franco-Nevada Corporation (“Franco-Nevada”)
o $20.0 million investment by Eldorado Gold Corporation (“Eldorado Gold”)
o $250 million gold stream with Franco-Nevada
o Represents one of Franco-Nevada’s largest gold streams on a primary gold mine
o $75 million senior secured term loan from Franco-Nevada
o $40 million in equipment financing with Caterpillar Financial Services Limited (“Cat Financial”)
o The gold stream and term loan financings are closed, and the remainder of the financing package is
expected to close in Q3-22
Louis-Pierre Gignac, President & Chief Executive Officer of GMIN , commented : “We are delighted to
welcome two new cornerstone partners in Franco-Nevada and La Mancha who are committed to the long -term
success and growth of GMIN. Their commitment, along with Eldorado Gold’s continued support, further validates
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the management team and the work done to advance the Project since its acquisition in 2021. Building on our
positive Feasibility Study released earlier this year, this financing package marks the next step in the progression
of GMIN and allows us to continue to unlock value at TZ. The imminent development of TZ will deliver value to
our growing stakeholder group, including generating attractive job opportunities and economic prosperity in Pará
State.”
Paul Brink, President & Chief Executive Officer of Franco-Nevada, commented: "We are delighted to support
GMIN with this construction financing package. Tocantinzinho is an attractive project in a prolific district and
located in a good jurisdiction. The GMIN team has a track-record as one of the most capable mine building teams
in the industry. The debt and equity investments that accompany our stream investment reflect our confidence in
the capabilities of the GMIN team and in the potential of the project.”
Karim Nasr, Managing Partner of La Mancha Capital Advisory LLP, commented: “The La Mancha Group has
a long track record of successful investments in the mining industry, and we look to build further on this track
record with La Mancha’s investment in GMIN. We are impressed with the unique skillset of the management team,
and with both the quality and potential of TZ. We look forward to being a part of GMIN’s journey toward s
becoming a n intermediate producer through the development of TZ, and as the Corporation evaluates future
growth opportunities beyond this initial Project.”
Overview of Project Financing
As detailed in the Feasibility Study published in Q1 -2022, the initial Project capital cost is estimated to be
$427 million, which is inclusive of $38 million of contingency (10% before taxes) . After taking into
consideration $49 million of payable taxes, the total funding required is $476 million . GMIN is eligible for
$18 million of recoverable taxes and tax credits, which have not been deducted in calculating development
capital required as this will only be received after the commencement of production.
As of June 30, 2022, GMIN has incurred capital expenditures of $21 million, resulting in remaining estimated
capital costs of $455 million, or $417 million exclusive of $38 million of contingency. Procurement to date
totaling $71 million is tracking on budget and has largely focused on major equipment for the process plant
and mining equipment. GMIN is progressing well on its procurement strategy that focuses on maximizing
Brazilian sources when sourcing equipment and supplies.
The total financing package of $481 million, combined with $54 million of cash on hand as at June 30, 2022,
totals $535 million of available capital, and provides GMIN with committed capital sources in excess of the
remaining estimated capital balance. It is estimated that $32 million of the equipment financing provided by
Cat Financial will be utilized during the construction period, with $8 million to stay in reserve.
After taking into consideration corporate costs, working capital, and debt service, GMIN estimates cash
and budgeted contingency totaling $81 million (18%), as detailed below.
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Figure 1 – Sources and Uses of Funds Summary
Financing Package Summary
In connection with the financing package, GMIN and Franco-Nevada have executed final documentation
with respect to: (i) a definitive purchase and sale agreement under which Franco-Nevada (Barbados)
Corporation will pay GMIN a deposit of $250 million to acquire a percentage of payable gold production
from TZ, (ii) the provision by Franco-Nevada, through one of its wholly-owned subsidiaries, of a senior
secured term loan in the principal amount of $75 million, and (iii) the purchase by Franco-Nevada, on a
private placement basis, of approximately 44.7 million GMIN common shares at a subscription price of
C$0.80 per share, for total proceeds of $27.5 million (C$35.8 million).
Concurrently, GMIN, La Mancha, and Eldorado Gold have executed final documentation with respect to the
purchase by La Mancha and Eldorado Gold, on a private placement basis, of 111.9 million and 32.5 million,
respectively, GMIN common shares at a subscription price of C$0.80 per share, for gross proceeds of $68.8
and $20.0 million (C$89.5 and C$26.0 million), respectively.
Equity Private Placement – Strategic Investors
o C$151.3 million ( $116.4 million) in equity financing, priced at C$0.80 per share , via a non -brokered
private placement
o La Mancha has agreed to subscribe for a total of 111,879,265 common shares of GMIN for aggregate
proceeds of C$89.5 million ($68.8 million)
o La Mancha will subscribe for 82,875,000 common shares on closing to hold 19. 8% of
GMIN’s common shares outstanding, and subscribe for a further 29,004,265 common
shares to hold 25.0% following approval of the disinterested GMIN shareholders
Cash On Hand $54 mm
Remaining TZ Capex
pre Contingency
$417 mm
Equity Financing
$116 mm
Repayment of
Equipment Financing
$13 mm Equipment Financing
Utilized
$32 mm / $40 mm
Corporate Costs, NSR
Buyback, Exploration, and
Financing Costs
$16 mm
$32 mm l $8 mm
reserve
Equipment Financing
Reserve
$8mmGold Stream $250 mm
Contingency $38 mm
Term Loan $75 mm Cash Buffer $43 mm
Total Sources:
$535 mm
Total Uses:
$535 mm
Sources Uses
Cash and Contingency
$81mm
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o GMIN and La Mancha will enter into an investor rights agreement that grants La Mancha
the right to nominate two directors to GMIN’s Board of Directors , as long as La Mancha
maintains a minimum ownership of 15%
o Karim Nasr, Managing Partner of La Mancha Capital Advisory LLP, will be nominated on the
closing date of the first tranche, with a second director to follow at a later date
o La Mancha will be granted customary anti-dilution, registration, and information rights, and
has agreed to a 24-month standstill period that includes restrictions on dispositions
o Franco-Nevada has agreed to subscribe for 44,687,500 common shares of GMIN for aggregate
proceeds of C$35.8 million ($27.5 million)
o Franco-Nevada will hold 9.9% of GMIN’s common shares outstanding
o GMIN and Franco-Nevada have entered into an investor rights agreement that grants
Franco-Nevada a right of first refusal on any future royalty and stream sales by GMIN as
long as Franco-Nevada maintains a minimum ownership of 5.0% of GMIN’s common shares
outstanding
o Franco-Nevada has also been granted customary anti -dilution rights and has agreed to a
24-month standstill period that includes restrictions on dispositions
o Eldorado Gold has substantially exercised its anti -dilution right and has agreed to subscribe for
32,500,000 common shares of GMIN for aggregate proceeds of C$26.0 million ($20.0 million)
o Eldorado Gold will hold 17.7% of GMIN’s common shares outstanding
Members of the Gignac Family, along with GMIN directors and officers (collectively “ Insiders”) hold
34,722,869 common shares, which will represent 7. 8% of GMIN’s common shares outstanding pro -forma
the transaction. To further align with the Strategic Investors, the Insiders have agreed to a 24 -month
restriction on sales or transfers of any GMIN securities.
The private placement is subject to the acceptance of the TSX Venture Exchange (“ TSXV”) and will be
completed in two tranches, with the first tranche closing in July 2022. The second tranche, which will consist
of the issuance to La Mancha of approximately 29.0 million GMIN common shares for proceeds of
approximately C$23.2 million ($17.8 million ), and which will be subject to a majority approval of the
disinterested GMIN shareholders pursuant to the policies of the TSXV, is expected to close in Q3-22. At the
time of writing, v oting support agreements that comprise more than 45% of th e disinterested GMIN
shareholders have been entered into with the Strategic Investors and Insiders.
Gold Stream – Franco-Nevada
o Deposit: $250.0 million
o Deliveries: 12.5% of the gold production from TZ, reducing to 7.5% after delivery of 300,000 ounces
o Ongoing Payments: 20% of the spot gold price at the time of delivery
o ESG Initiatives: Up to $250,000 per year for four years for investment towards environmental initiatives
and social projects in the communities surrounding TZ
o Drawdown of the deposit is subject to satisfaction of certain customary conditions for a transaction of
this nature
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Term Loan – Franco-Nevada
o Facility Amount: $75.0 million
o Term: 6.0 years
o Availability Period: Multi -draw facility available after the stream deposit is fully drawn, at GMIN’s
discretion for up to 3.5 years
o Standby fee on undrawn amounts of 1.0% per annum, which GMIN has the option of
accruing and capitalizing for the first 2-year period
o Coupon: 3-Month Term Secured Overnight Financing Rate plus a margin of 5.75% per annum pre-
project completion, with the margin reducing to 4.75% after completion
o 2-year i nterest deferral period during which GMIN has the option of accruing and
capitalizing interest
o Amortization: Principal, accrued interest, and accrued fees are repayable starting in December 2025 as
follows:
o 10 equal quarterly payments equal to 7.5% of the balance outstanding; and
o Bullet payment equal to 25.0%
o Original Issue Discount: 2.0% applicable on amounts drawn
o Franco-Nevada will be granted 11. 5 million warrants with a five -year term and a n exercise price of
C$1.90 per share
o Exercise price equals the exercise price of the existing 37.5 million warrants issued as part
of GMIN’s September 2021 financing, the only currently outstanding warrants
o Warrants will have a cashless exercise mechanism to enable Franco-Nevada to avoid its
holdings from exceeding 9.9% of GMIN’s common shares outstanding at time of exercise
Equipment Financing
o Up to $40 million in equipment financing via a credit-approved term sheet with Cat Financial, for the
supply of Caterpillar primary and ancillary mining fleet and construction machinery
o Pending completion of final documentation, t he Cat Financial lease financing will be available to the
Corporation upon a final construction decision by GMIN’s Board of Directors and other customary
conditions
Tocantinzinho Development Update
Since the most recent project update released on May 26, 2022, GMIN has advanced the following aspects
of the Project:
Procurement
o Procurement to date totals $ 71 million, is tracking on budget, and has largely focused on major
equipment for the process plant and mining equipment
o Procured equipment contains significant Brazilian content
o Purchase orders for equipment with long lead times have been executed to achieve the construction
schedule in order to achieve production in the second half of 2024
o Equipment deliveries will be staggered over time with first machines delivered to site in September
2022
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o Primary mining equipment is currently being funded using cash on hand, but will be refinanced through
the abovementioned $40 million equipment financing package
Power Supply
o Detailed engineering of transmission line and Novo Progresso substation is complete
Construction – Early Works Activities
o Exploration camp capacity has been increased to 350 beds with the addition of 10 dormitories
o New water well, lunchroom and kitchen equipment in operation
o Temporary explosives storage facility is progressing, with berms in place and fencing to be completed
o The logistics base in Moraes Almeida is nearing completion
o Once delivered, the facility will be managed by the logistics freight forwarder, which will
allow for consolidation of goods for delivery to site
o Access road upgrades have continued with the arrival of the dry season
Figure 2 – Expansion of Exploration Camp
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Figure 3 – Freight forwarder base in Moraes Almeida
Figure 4 – Access Road Upgrade