Golden Star secures US$150 million financing from Royal Gold

May 7, 2015, Golden Star has secured a US$150 million financing with Royal Gold, Inc. (RGI). and its wholly-owned subsidiary RGLD Gold AG (RGLD). The financing consists of a US$130 million stream transaction with RGLD (the “Stream Transaction”) and a further US$20 million term loan from RGI (the “Term Loan”). Pursuant to the Stream Transaction, RGLD has agreed to pay a wholly-owned subsidiary of Golden Star (the “Seller”) a US$130 million advance payment in exchange for a gold stream on Golden Star’s Bogoso, Prestea and Wassa mines. RGLD will provide Golden Star with the advance payment to be used for the development of the Wassa and Prestea underground mines and general corporate purposes. Under the Stream Transaction, the Seller will receive an initial US$55 million payment when certain customary conditions precedent have been met and the remaining US$75 million will be paid as development spending on the Wassa and Prestea underground mines progresses in line with an agreed payment schedule. RGI has agreed to provide a wholly-owned subsidiary of Golden Star with a US$20 million secured term loan for a four year period at an interest rate linked to the gold price. The interest rate is calculated as the product of the average spot gold price over the quarter and 62.50% divided by 10,000, and shall not exceed 11.5%. At a gold price of $1,200 this equates to an interest rate of 7.5%. RGLD’s advance payment under the Stream Transaction will be secured against the Wassa, Bogoso and Prestea assets. In addition, the Term Loan also will be secured against the Wassa, Bogoso and Prestea assets. Funding under each of the Stream Transaction and the Term Loan is contingent upon the satisfaction of certain customary conditions precedent. Golden Star was advised by Fasken Martineau with a team led by John Sabetti, and including John Turner, Andrew Gabrielson, Jon Holmstrom, Aaron Stefan, Mitchell Thaw, Louise Kennedy, William Shaw and Reid Crombie.