To fund development of its Magistral gold project in Mexico’s Sinaloa state, Santa Cruz Gold (SCG-T) has completed a $6.8-Million financing deal with Repadre International, a wholly owned subsidiary of Repadre Capital (RPD).
Repadre purchased 3.4 million Santa Cruz shares at $1 each in a private placement.
Repadre also bought from Santa Cruz a sliding-scale net smelter return royalty on gold from Magistral, at the rate of 1% on the initial 30,000 oz.
gold produced, 3.5% on the next 350,000 oz., and 1% thereafter.
Santa Cruz will issue warrants to Repadre, entitling it to buy up to 2 million Santa Cruz shares at $1.30 per share for three and a half years.
Santa Cruz expects to begin mine construction at Magistral during the second half of 1997.
Grant Edey, Repadre’s chief financial officer, will join Santa Cruz’s board of directors.
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