Apollo Gold (AMEX:AGT)
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5 Years : From May 2008 to May 2013
Apollo Gold Corporation (“Apollo” or the “Company”) (TSX: APG) (NYSE
Amex: AGT) has reached an agreement with RAB Special Situations (Master)
Fund Limited (“RAB”), the holder of principal amount $4,290,000
unsecured convertible debentures due February 23, 2010 (the “Convertible
Debentures”), to extend the maturity date of these Convertible
Debentures to August 23, 2010. All dollar amounts in this news release
are in U.S. dollars.
The Convertible Debentures were issued in a private placement on
February 23, 2007 (the “Placement”) and amended on February 16, 2009.
Each $1,000 principal amount of the Convertible Debentures is
convertible at the option of RAB into 2,000 of the Company’s common
shares (the “Conversion Price”), at any time until August 23, 2010.
Additionally, RAB may, at its election, concurrently convert any accrued
but unpaid interest in respect of the principal amount into common
shares at the Conversion Price.
Under the terms of the Convertible Debentures, $772,200 of accrued and
unpaid interest is due as of February 23, 2010, which RAB and the
Company have agreed will be paid in cash by March 3, 2010. In
consideration for the extension of the maturity date of the Convertible
Debentures, the Company has agreed to issue to RAB, as soon as
practicable following receipt of all required regulatory approvals, (i)
800,000 additional common shares of the Company (the “RAB Shares”) and
(ii) 2,145,000 common share purchase warrants (the “RAB Warrants”)
whereby one RAB Warrant entitles the holder to purchase one common share
at an exercise price of $0.50 per share, expiring February 23, 2011.
The RAB Shares and the common shares issuable on conversion of the
Convertible Debentures and the exercise of the RAB Warrants are expected
to be registered with the United States Securities and Exchange
Commission.
Project Finance Facility
The Company is also progressing well in its discussions and work with
Macquarie Bank Limited and RMB Australia Holdings Limited (together, the
“Banks”) related to the prior announced technical review of the Black
Fox Mine in respect of the deferred scheduled repayments and associated
debt service reserve funding due in 2009 under the Company’s $70 million
project finance facility (the “Facility”). The Banks and the Company are
jointly working towards a new repayment schedule and restructuring of
the Facility. The Banks’ review of the new mine plan continues to
progress satisfactorily and the agreed February 28, 2010 completion date
for that review, together with the previous deferrals of the payments
due September 30, 2009 and December 31, 2009 have been extended to March
31, 2010. The Company expects to produce 100,000 ounces of gold from
Black Fox in 2010.
Apollo Gold Corporation
Apollo is a growing gold producer that operates the wholly owned Black
Fox Mine in Ontario, Canada, which commenced gold production in May
2009. Apollo is also exploring the adjoining Grey Fox and Pike River
properties, all in the Timmins gold district in Ontario, Canada, as well
as the Huizopa Joint Venture, (80 percent Apollo and 20 percent Minas De
Coronado, S. de R.L. de C.V.), an early stage, gold-silver exploration
project, approximately 16 kilometers (10 miles) southwest of
Minefinders’ Dolores gold-silver mine, in the Sierra Madres in
Chihuahua, Mexico. At December 31, 2009, Apollo had approximately 264.2
million outstanding shares and 387.4 million fully diluted shares.
FORWARD-LOOKING STATEMENTS
This news release includes “Forward-Looking Statements” within the
meaning of section 21E of the United States Securities Exchange Act
of 1934, as amended. Forward-looking statements can be identified by the
use of words such as “may,” “should,” “expects,” “plans,” “anticipates,”
“believes,” “estimates,” “predicts,” “intends,” “continue,” or the
negative of such terms, or other comparable terminology. All statements
regarding the issuance and registration of securities to be issued to
RAB, our discussions with the Banks, the timing of any resolution in
regards to a revised payment schedule and gold production from Black Fox
Mine in 2010 are forward-looking statements that involve various risks
and uncertainties. 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 these
forward-looking statements are disclosed under the heading “Risk
Factors” and elsewhere in Apollo documents filed from time to time with
the Toronto Stock Exchange, the NYSE Amex, The United States Securities
and Exchange Commission and other regulatory authorities. All
forward-looking statements included in this news release are based on
information available to Apollo on the date hereof. Apollo assumes no
obligation to update any forward-looking statements.
