Further to its news releases of July 1 and 14, 2020, Harte Gold Corp.  (TSX: HRT) (OTC: HRTFF) (Frankfurt: H4O) is pleased to announce that it has closed the previously announced US$18.5 million non-revolving credit facility. The Credit Facility, provided by AHG (Jersey) Limited, an affiliate of ANR Investments 2 B.V. is secured by a second priority ranking lien on the Company’s assets, matures on June 30, 2023 and accrues interest at a rate per annum equal to 14%, which is payable in common shares of the Company. US$1 million of the proceeds from the Credit Facility will be used to prepay part of the Company’s currently existing non-revolving term credit facility with BNP Paribas and the other lenders party thereto from time to time.

In connection with the closing of the Credit Facility, the 9,500,000 Series B special shares that were previously issued to ANR Investments B.V., an affiliate of Appian, converted into US$9.5 million of principal amount under the Credit Facility, bringing the aggregate principal amount of the Credit Facility to US$28 million. The Credit Facility also maintains an uncommitted US$20 million accordion option, which can increase the aggregate principal amount available under the Credit Facility to US$48 million.

The Company also entered into certain amendments to the BNP Facility in order to, inter alia, permit the Company to enter into the Credit Facility.

The Company also concluded the previously announced 0.5% NSR on the entire Sugar Zone Property with an affiliate of Appian on similar terms as the Company’s existing 1.5% NSR, in exchange for payment to the Company of US$2.0 million.

A copy of the Credit Facility will be filed and available under the Company’s profile on SEDAR at www.sedar.com.

FINANCIAL HARDSHIP EXEMPTIONS

As previously disclosed, the Company has been granted an exemption by the Toronto Stock Exchange from the requirement to seek shareholder approval for the transactions contemplated in this press release  pursuant to the financial hardship exemption available to companies listed on the TSX that are in serious financial difficulty, in each case subject to customary conditions. As previously disclosed on July 1, 2020, as a result of the Company’s reliance on the “financial hardship” exemption, the TSX has placed the Company under remedial delisting review, which is customary in these circumstances. Although the Company believes that it will be in compliance with the TSX’s continued listing requirements following the closing of the Transactions, no assurance can be provided as to the outcome of such review or continued qualification for listing on the TSX.

Each of the Transactions is a “related party transaction” as defined in Multilateral Instrument 61-101 – Protection of Minority Security Holders in Special Transactions. The Company is exempt from the requirements to obtain a formal valuation or minority shareholder approval in connection with the Transactions in reliance on sections 5.5(g) and 5.7(1)(e), respectively, of MI 61-101, as the Company meets the requirements of the financial hardship exemption. 

ABOUT HARTE GOLD CORP.

Harte Gold holds a 100% interest in the Sugar Zone Mine located in White River, Canada.  The Sugar Zone Mine entered commercial production in 2019. The Company has further potential through exploration at the Sugar Zone Property, which encompasses 79,335 hectares covering a significant greenstone belt.