/NOT FOR DISTRIBUTION TO UNITED
STATES' NEWSWIRE SERVICES OR DISSEMINATION IN THE UNITED STATES/
TORONTO, Aug. 26, 2015 /CNW/ - Atlanta Gold Inc. (TSXV:
ATG; OTC Pink: ATLDF) announces that it has completed its
previously announced refinancing transaction with Concept Capital
Management Ltd. ("CCM") and the private placement of
C$550,000 principal amount
convertible debentures. Under the terms of the refinancing
with CCM, the Company refinanced C$3,250,000 of indebtedness by issuing to CCM
US$1.5 million principal amount
senior secured notes and a C$1.5
million principal amount convertible debenture.
Concurrently with the completion of the refinancing transaction
with CCM, the Company completed the private placement of additional
convertible debentures in the aggregate principal amount of
C$550,000. Proceeds received
from this placement will be used for working capital
purposes. All of the convertible debentures bear interest of
10% per annum, mature April 1, 2018
and are convertible at the holder's option at a conversion price of
C$0.10 per share. The
convertible debentures are secured by limited recourse guarantees
of the Company's subsidiary, Atlanta Gold Corporation
("AGC"), and by mortgages of AGC's interest in its Atlanta
Project. In connection with the private placement of convertible
debentures, the Company paid a finder's fee of 192,000 warrants to
Golden Capital Consulting Ltd. Each warrant entitles the holder to
acquire one common share of the Company at an exercise price of
C$0.10 at any time prior to
April 1, 2018.
The senior secured notes bear interest of 10% per annum and are
secured by the limited recourse guarantee of AGC and by a mortgage
of AGC's interest in the Atlanta Project. The senior secured
notes mature August 31, 2018 and are
repayable in cash installments at the rate of 25%, 35% and 40% on
August 31, 2016, 2017 and 2018,
respectively. Pursuant to an intercreditor agreement entered
into by the lenders, the Company and AGC, the senior secured notes
and the convertible debentures and the respective security thereon
rank equally.
Pursuant to the refinancing, CCM received an option to purchase
1,567.5 troy ounces of gold at US$1,100 per troy ounce until August 31, 2018, with the option vesting at the
rate of 25%, 35% and 40% on August 31,
2016, 2017 and 2018, respectively.
The senior secured notes, the convertible debentures and the
common shares issuable on the conversion thereof, are subject to a
four-month statutory hold period, which will expire on December 27, 2015.
About the Company
Atlanta Gold Inc. holds
through its 100% owned subsidiary, Atlanta Gold Corporation,
leases, options or ownership interests in its Atlanta properties which comprise
approximately 2,159 acres (8.74 square kilometres) located 90 air
kilometers east of Boise, in
Elmore County, Idaho. A long
history of mining makes Atlanta
very suitable for development of new mining projects. The
Company is focused on advancing its core asset, Atlanta, towards mine development and
production.
To receive Company news via email, contact info@atgoldinc.com
and mention "Atlanta Gold News" in the subject line.
NEITHER THE TSX VENTURE EXCHANGE NOR ITS REGULATION SERVICES
PROVIDER (AS THAT TERM IS DEFINED IN THE POLICIES OF THE TSX
VENTURE EXCHANGE) ACCEPTS RESPONSIBILITY FOR THE ADEQUACY OR
ACCURACY OF THIS RELEASE.
SOURCE Atlanta Gold Inc.
