Goldplat has announced that the sale of Kilimapesa Gold Mine to Mayflower Gold Investments Limited in Migori County, Western Kenya is now complete. The completion of the Transaction will enable Goldplat to focus on its recovery operations and Mayflower Gold’s parent company Mayflower Capital Investments Pty Limited to accelerate its investment into Kilimapesa.
In order to enable early completion of the transaction, both parties agreed to waive the requirement that Papillon Holdings plc completes its proposed reverse takeover of Mayflower Gold and re-admission to trading on the London Stock Exchange.
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The transaction
The initial consideration receivable by Gold Mineral Resources Ltd, Goldplat’s subsidiary, is in the form of a secured debenture of US $1.5m to be satisfied by cash and/or the issue of shares to that value in Papillon payable on Papillon’s re-admission to trading on the LSE following completion of the RTO, with 30% of the initial consideration payable in cash. In the event that Papillon is not re-admitted to trading on the LSE by 16th July 2021, the full initial consideration of US $1.5 will become payable in cash and will attract interest of 4% with effect from 1st January 2021.
As part the conditions to complete the Transaction, and additional to the initial consideration, Mayflower has agreed to pay US $150,000 of the loan balance outstanding from Kilimapesa to GMR and Mayflower Gold and Mayflower have waived all further conditions, specifically the conditions with regard to the renewal of the prospecting license.
Earlier this month, Mayflower raised approximately US $2m of funding and has undertaken to use this towards meeting Kilimapesa’s capital expenditure and working capital requirements. In addition, Mayflower has secured a further GBP2.5m conditional on completion of the RTO and re-admission of Papillon to trading on the LSE.
Mayflower Gold have provided GMR with a debenture over their assets, with Mayflower acting as guarantor and have committed to a further charge to be provided by Kilimapesa over its assets for the benefit of GMR. The Novation Agreement assigning to Mayflower Gold the loan outstanding from Kilimapesa to GMR of circa US $10m will only complete once the initial consideration of US $1.5 has been received.
With the completion of the sale of Kilimapesa, GMR is entitled to receive a 1% net smelter royalty on all production from Kilimapesa up to a maximum of US $1.5m on any future production from Kilimapesa.
