Sixty North Gold arranges $3.6-million term loan

Executive Summary

• Sixty North Gold Mining Ltd. has signed a binding commitment letter with Vesta Wealth Partners Ltd. for a $3.6-million term loan to finance the development and restart of operations at its wholly owned Mon gold mine in the Northwest Territories.
• The financing includes significant equity upside for the lender, consisting of 6.65 million share purchase warrants exercisable at $0.14 per share for three years, and a 2.5% net smelter return (NSR) royalty.
• The loan is repayable within 36 months of closing, with interest accruing at 12% per annum and no principal payments required until December 2026.

Key Details

• Transaction Structure: Binding commitment letter for a $3.6-million term loan from Vesta Wealth Partners Ltd. (independent investment firm).
• Use of Proceeds: Financing development to production of the Mon gold mine.
• Repayment Terms:
  • Repayable within 36 months of closing.
  • Interest rate: 12% per annum on outstanding principal.
  • Principal payments deferred until December 2026.
• Equity Component:
  • Issuance of 6.65 million share purchase warrants to Vesta.
  • Exercise price: $0.14 per warrant.
  • Term: Three years following issuance.
• Royalty Terms:
  • 2.5% net smelter return (NSR) royalty on activities at the Mon gold mine.
  • Duration: Minimum of four years.
  • Buyback option: Available for a repurchase price of up to $5 million.
• Security: Sixty North Gold provides a first-ranking senior security interest over the Mon gold mine.
• Governance: Appointment of two qualified nominees from Vesta to the company’s board of directors during the loan term.
• Fees: No finders' fees were paid or are payable.
• Regulatory Conditions: Subject to negotiation of definitive agreements and approval of the Canadian Securities Exchange.
• Project Context: The Mon gold mine is located 45 km north of Yellowknife, NWT. It is the only operating gold mine in the NWT and the first in the Yellowknife gold belt since the Discovery mine started in 1948 (excluding initial 1990s development).
• Operational Plan:
  • Reopening and extending the north ramp to intersect the vein 17 meters below historical stopes.
  • Development of stopes in the east limb, west limb, and DD zone.
  • Feeding a 100-tonne-per-day (tpd) gravity flotation mill.
  • Historical production in the 1990s extracted 15,000 tonnes of ore, recovering an estimated 15,000 ounces of gold.

Notable Quotes

• Dr. Dave Webb, President and CEO: "It is exciting to be able to bring mining back to Yellowknife. This high-grade camp hosts the past-producing Con mine, Giant mine and Discovery mines that produced 14 million ounces of gold at grades greater than 16 gpt, as well as the Mon gold mine that produced at 30 gpt gold in the 1990s..."
• Jared Wolk, Chief Investment Officer, Vesta Wealth Partners: "We at Vesta Wealth Partners are incredibly excited to be involved in a project of this significance. The Mon gold mine represents a unique opportunity to restart production in a historic and proven high-grade gold camp. Our financing commitment reflects our confidence in the operational plan, the quality of the Mon asset, and the vision of Dr. Webb and the Sixty North Gold team to bring the Yellowknife gold belt back to active production."