Golden Star Resources Limited has announced that the Company, its wholly-owned subsidiary, Caystar Holdings, and its major shareholder, Blue International Holdings Limited have amended the share purchase agreement with Future Global Resources Limited (FGR).
The share purchase agreement dated July 26, 2020 relates to the sale of Golden Star’s 90% share in the Bogoso-Prestea Gold mine to Future Global Resources Limited. The share purchase agreement is supplemented by a letter agreement dated September 30, 2020.
Outlined in the Share Purchase Agreement include staged payments by the Future Global Resources Limited. These payments are part of the considerations for deferred payments.
Amended Share Purchase Agreement
Per this new amendment, the staged payments reprofiling will allow time for Future Global Resources to complete an environmental binding process for Bogoso-Prestea. This action will also bring forward the second deferred payment due in 2021, the statement said.
Furthermore, this move will ensure that the first and second staged payments take place on May 31, 2021. Specifically, two months earlier than previously agreed upon.
The amended share purchase agreement requires that deferred payments take place in such a way that the $5 million payment that was due on March 30, 2021, now be payable no later than May 31, 2021.
The $10 million payment due on July 31, 2021 brought forward for payment by no later than May 31, 2021. An amount of approximately $4.6 million will be liable for payment by no later than July 31, 2021 by FGR.
According to the press statement, the $4.6 million comprises of a working capital balancing payment of approximately $4.3 million. As well as fees of approximately $0.3 million for services provided by Caystar Holdings to FGR. This is in pursuant of a transition agreement on September 30, 2020.
Golden Star Resources Ltd. further indicates that, in pursuant of the terms of the amendment agreement, FGR will introduce a reclamation bond. This bond is in respect of FGR’s environmental rehabilitation obligations for Bogoso-Prestea.
Future Global Resources Limited will also pay to the Environmental Protection Agency (EPA) per the agreement. The amount agreed with the EPA by March 30, 2021 or in accordance to the agreement between EPA and FGR.
Performance of Golden Star Resource Ltd. in 2020
The Company’s performance in production year-end 2020 saw significant improvements and achievements.
Andrew Wray, the Chief Executive Officer of Golden star indicated that:
“… 2020 saw a number of important achievements for our business. [These achievements] underpin our confidence in delivering on our longer term growth plan. The $36.8 million of cash flow generation from Wassa, combined with the sale of Bogoso-Prestea and the refinancing of the Macquarie loan facility, delivered a significant improvement in our financial position.
“In turn, this enabled us to invest in key infrastructure necessary for the continuing growth of Wassa, including electrical upgrades, new dewatering infrastructure and a state-of-the-art paste fill plant, that positions Golden Star to realize the longer-term growth potential for the Wassa operation.”
Despite the numerous challenges encountered during the pandemic, the Company still recorded strengthened operational performance. This was due to increased investment in underground development during Q4 of 2020. In addition to the higher than budgeted price of gold during the period.
Golden Star is a gold mining company that owns and operates the Wassa underground mine. The company is listed on the New York Stock Exchange (NYSE), the Toronto Stock Exchange and the Ghanaian Stock Exchange.
READ ALSO: Africa Signs Historic Agreement with Johnson & Johnson for 400 Million Doses of COVID-19 Vaccines
