VANCOUVER, Dec. 31, 2014 /CNW/ - Golden Queen Mining Co. Ltd. (TSX:GQM; OTCQX:GQMNF) (the "Company") is pleased to announce that it has entered into a term loan agreement to secure a US$12,500,000 loan (the "Loan"). A portion of the proceeds of the Loan will be used to retire a term loan from members of the Clay family, due January 1, 2015. The payment includes principal, accrued interest and an extension fee, for an aggregate amount of US$11,000,000.
Members of the Clay family (the "Lenders") have provided the Loan. US$9,375,000 of the Loan has been provided by an investment vehicle managed by Thomas M. Clay, a Director and insider of the Company. The Loan has a six-month term and bears an annual interest rate of 10%, payable quarterly on the first business day of each quarter. The Company has paid a US$1,000,000 closing fee to the Lenders. The Loan is guaranteed by Golden Queen Mining Holdings, Inc. a subsidiary of the Company ("GQ Holdings"), and secured by a pledge of the Company's interests in GQ Holdings and GQ Holdings' interest in Golden Queen Mining Company, LLC. No finder's fee will be paid in connection with the Loan.
In addition to entering into the term loan agreement, the Company granted the Lenders and their affiliates registration rights under the terms of a registration rights agreement.
The loan demonstrates the on-going support of the Company's major shareholder – The Clay family, in the development of its gold project in California, in a difficult financial market for resource companies.
About Golden Queen Mining Co. Ltd:
The Company is developing a gold-silver, open pit, heap leach operation on its fully-permitted 50% owned Soledad Mountain property, located just outside the town of Mojave in Kern County in southern California. The Project will use conventional open pit mining methods and the cyanide heap leach and Merrill-Crowe processes to recover gold and silver from crushed, agglomerated ore.
The Toronto Stock Exchange has not reviewed and does not accept responsibility for the adequacy or accuracy of the content of this press release.
Caution With Respect To Forward-looking Statements: The information in this news release includes certain "forward-looking statements". All statements in this news release, other than statements of historical fact, including, without limitation, use of the proceeds of the Loan, expectations related to payment of interest and the grant of registration rights and other statements, estimates and plans, are forward-looking statements. There can be no assurance that such statements will prove to be accurate, and actual results and future events could differ materially from those anticipated in such statements. Important factors that could cause actual results to differ materially from statements in this news release regarding our intentions include available cash to repay principal and interest, uncertainties related to the filing of registration statements and other risks and uncertainties disclosed in the section entitled "Risk Factors" contained in our Annual Report on Form 10-K for the year ended December 31, 2013 and in our Quarterly reports on Form 10-Q for the periods ended June 30, 2014 and September 30, 2014. Investors are cautioned that forward-looking statements are not guarantees of future performance and, accordingly, should not to put undue reliance on forward-looking statements. Any forward-looking statement made by us in this release is based only on information currently available to us and speaks only as of the date on which it is made.
SOURCE: Golden Queen Mining Co. Ltd.
For further information: For further information regarding this news release please contact: Lutz Klingmann, President & CEO, Telephone: (604) 921-7570, Email: [email protected]