Esgold obtains $9-million facility from Ocean Partners

Executive Summary

• Esgold Corp. entered a binding term sheet with Ocean Partners U.K. Ltd. for a up‑to $9 million pre‑payment and working‑capital facility, payable in two tranches tied to Montauban production milestones.
• The agreement includes an offtake contract obligating Ocean Partners to purchase 100 % of gold and silver dore from Montauban tailings and crown‑pillar material (minimum 50,000 oz Au and 1 M oz Ag).
• Facility terms provide financing at SOFR + 7 % with a 1 % arrangement fee, repayment through dore deliveries, and no equity dilution, strengthening Esgold’s balance sheet and cash‑flow outlook.

Key Details

• Facility Size: Up to US$9 million (C$≈13 M).
• Drawdown Schedule:
• Tranche 1 – US$3 M: Available ~3 months before anticipated Phase 1 production (expected Feb 2026).
• Tranche 2 – US$6 M: Available ~5 months before anticipated Phase 2 production (expected Mar 2027).
• Purpose: Completion of the Montauban processing facility and general working‑capital needs.
• Repayment Mechanism: Facility repaid through gold‑silver dore deliveries per tranche‑specific schedule; 90 % of payment made in cash on the first business day after delivery, with remaining balance settled via metal settlement at LBMA/COMEX prices.
• Offtake Terms: Ocean Partners purchases 100 % of Montauban’s gold and silver dore (tailings + crown‑pillar material). Minimum deliveries: 50,000 oz Au and 1,000,000 oz Ag per tranche.
• Pricing & Payments: Settlement at LBMA/COMEX spot; 90 % cash paid immediately after delivery.
• Interest Rate: SOFR + 7 % p.a. (3‑month secured overnight financing rate plus 7 %).
• Arrangement Fee: 1 % of each drawdown, deducted from the amount funded.
• Conditions Precedent: Execution of definitive agreements, lender due diligence, and confirmation of construction/production timelines.
• CEO Quote (Esgold – Gordon Robb): Emphasized that the facility “significantly strengthens our financial position… debt obligations will be serviced through operating cash flow rather than equity dilution.”
• CEO Quote (Ocean Partners – Brent Omland): Highlighted the strategic fit of Montauban’s low‑capex, high‑margin model and expressed enthusiasm for a long‑lasting partnership.
• Next Milestones:
• Completion of Montauban construction targeted for mid‑Q4 2025.
• Concentrate test results expected in coming weeks.
• Ongoing exploration and systematic drilling at Montauban; 3‑D geological model and ambient noise tomography integration underway.
• Parallel development of Colombian joint venture with financing secured.

Notable Quotes

• “This agreement with Ocean Partners is an important step forward for Esgold… provides additional financial flexibility as we advance Montauban.” – Gordon Robb, CEO, Esgold
• “The Montauban project is exactly the type of innovative opportunity in which we like to be involved… we are excited about the long‑term potential in this area of Quebec.” – Brent Omland, CEO, Ocean Partners