Cerrado Gold Appoints the Toronto-Dominion Bank To Be the Mandated Lead Arranger for Export Credit Agency Supported Project Financing at Its Mont Sorcier Iron and Vanadium Project in Québec

Rhea-AI Summary

Cerrado Gold Inc. (CERT) appoints Toronto-Dominion Bank as Mandated Lead Arranger for potential UKEF-supported project financing of up to $598 million for its Mont Sorcier Iron and Vanadium Project in Quebec, with final stages of MLA appointment for Monte Do Carmo project in Brazil. The UKEF-backed facility is expected to cover 70% of project capital expenditures for the Mont Sorcier project, reducing overall project risk and lowering costs of capital through political and commercial guarantees. The conclusion of project financing remains subject to the completion of a bankable feasibility study, environmental impact assessment, and other requirements.

Positive

• Appointment of Toronto-Dominion Bank as MLA for potential UKEF-supported project financing is a significant milestone for the Mont Sorcier project
• UKEF-backed facility expected to cover 70% of project capital expenditures, reducing overall project risk and lowering costs of capital
• Strong interest in the project indicative of the robust nature of the Mont Sorcier project

Negative

• Conclusion of project financing remains subject to the completion of a bankable feasibility study, environmental impact assessment, and other requirements

• Indicative Terms for up to US$598m in a potential UKEF (UK Export Credit Agency) Supported Project Financing
• Company in final stages of appointing the Mandated Lead Arranger for Monte Do Carmo, Brazil

(All numbers reported in US dollars)

TORONTO, ON / ACCESSWIRE / November 21, 2023 / Cerrado Gold Inc. (TSXV:CERT)(OTCQX:CRDOF) ("Cerrado" or the "Company") is pleased to announce that further to the October 18, 2023 announcement in relation to potential Export Credit Agency ("ECA") Supported Project Financing of up to $598 million, the Company has appointed the Toronto-Dominion Bank ("TD") as the MLA for its Mont Sorcier Iron and Vanadium Project located in Québec. Cerrado is also in the final stages of finalizing the appointment of the MLA for its Monte Do Carmo project in Brazil.

As announced on September 5th, the Company together with its advisors, SD Capital Advisory Ltd and GKB Ventures Ltd ("S&G"), initiated a tender process to solicit interest from global Project Finance Banks to act as the MLA for the Company's Brazil and Quebec projects. As a result of this competitive process, the company received compelling bids. Together with the Company's advisors, the bids were evaluated based on ECA Project Finance Experience, execution capabilities and ultimately the financial terms for the Project Financing. TD has extensive experience in ECA financing, a longstanding relationship with UKEF, and presented competitive and compelling terms for the project financing.

The UKEF-backed facility is expected to be for up to US$598 million on a non-recourse project financing basis for a total tenor of 11 years. The funding will be to cover 70% of the expected project capital expenditures for the Mont Sorcier project.

As is common for ECA-supported Project Financing, UKEF provides political and commercial guarantees to project lenders, thereby lowering the overall project risk to the lender and resulting in lower costs of capital. This reduces the cost of debt to Cerrado Gold (and its 100% owned company Voyager Metals Inc) whilst at the same time extending tenors and creating debt capacity not normally available in the commercial bank market. To secure such support, project developers commit to a pre-agreed level of procurement from UK-based organizations for goods, services and materials. UKEF's mandate is to promote and support exports from British companies in the global market.

The appointment of TD is on an exclusive basis and sets out the indicative terms upon which the proposed ECA financing is expected to be based. For the avoidance of doubt, the terms are purely indicative and do not constitute an offer of finance or a legally binding commitment of any kind to provide finance. The provision of any binding offer is subject to, among other things: credit and other internal approvals; E&S approvals; satisfactory due diligence and documentation; satisfaction of KYC requirements and other terms customary for this type of transaction.

While the conclusion of project financing remains subject to the completion of a bankable feasibility study, an environmental impact assessment, the granting of construction permits, amongst other requirements, the appointment of the MLA is a significant milestone for the project financing of the Mont Sorcier project. At the Mont Sorcier project, work continues to advance the feasibility study and the environmental impact assessment. The feasibility study is targeted for completion in H2 2024 after which the next phase of the process will commence comprising of a formal due diligence period before a final binding offer and documentation.

Mark Brennan, CEO and Chairman, stated: "We are very pleased to have the support of TD as the MLA to lead our Project Financing in partnership with UKEF as we progress with the development of Mont Sorcier. We believe the strong interest in our project is indicative of the robust nature of the Mont Sorcier project and we look forward to working with TD, UKEF and other stakeholders to deliver the Mont Sorcier project".

About TD Bank Group
The Toronto-Dominion Bank and its subsidiaries are collectively known as TD Bank Group ("TD" or the "Bank"). TD is the sixth largest bank in North America by assets and serves over 27.5 million customers in four key businesses operating in a number of locations in financial centres around the globe: Canadian Personal and Commercial Banking, including TD Canada Trust and TD Auto Finance Canada; U.S. Retail, including TD Bank, America's Most Convenient Bank®, TD Auto Finance U.S., TD Wealth (U.S.), and an investment in The Charles Schwab Corporation; Wealth Management and Insurance, including TD Wealth (Canada), TD Direct Investing, and TD Insurance; and Wholesale Banking, including TD Securities and TD Cowen. TD also ranks among the world's leading online financial services firms, with more than 16 million active online and mobile customers. TD had $1.9 trillion in assets on July 31, 2023. The Toronto-Dominion Bank trades under the symbol "TD" on the Toronto and New York Stock Exchanges.

About Cerrado
Cerrado Gold is a Toronto-based gold production, development, and exploration company focused on gold projects in South America. The Company is the 100% owner of both the producing Minera Don Nicolás and Las Calandrias mine in Santa Cruz province, Argentina, and the highly prospective Monte Do Carmo development project, located in Tocantins State, Brazil. In Canada, Cerrado Gold is developing it's 100% owned Mont Sorcier Iron Ore and Vanadium project located outside of Chibougamou, Quebec.

In Argentina, Cerrado is maximizing asset value at its Minera Don Nicolas operation through continued operational optimization and is growing production through its operations at the Las Calandrias Heap Leach project. An extensive campaign of exploration is ongoing to further unlock potential resources in our highly prospective land package in the heart of the Deseado Masiff.

In Brazil, Cerrado is rapidly advancing the Serra Alta deposit at its Monte Do Carmo Project, through feasibility and into production. Serra Alta is expected to be a high-margin and high-return project with significant exploration potential on an extensive and highly prospective 82,542 hectare land package.

In Canada, Cerrado holds a 100% interest in the Mont Sorcier Iron Ore and Vanadium Project, which has the potential to produce a premium iron ore concentrate over a long mine life at low operating costs and low capital intensity. Furthermore, its high grade and high purity product facilitates the migration of steel producers from blast furnaces to electric arc furnaces contributing to the decarbonisation of the industry and the achievement of SDG goals.

For more information about Cerrado please visit our website at: www.cerradogold.com.

Mark Brennan
CEO and Chairman

Mike McAllister
Vice President, Investor Relations
Tel: +1-647-805-5662
mmcallister@cerradogold.com

Disclaimer
NEITHER TSX VENTURE EXCHANGE NOR ITS REGULATION SERVICES PROVIDER (AS THAT TERM IS DEFINED IN POLICIES OF THE TSX VENTURE EXCHANGE) ACCEPTS RESPONSIBILITY FOR THE ADEQUACY OR ACCURACY OF THIS RELEASE.

This press release contains statements that constitute "forward-looking information" (collectively, "forward-looking statements") within the meaning of the applicable Canadian securities legislation, all statements, other than statements of historical fact, are forward-looking statements and are based on expectations, estimates and projections as at the date of this news release. Any statement that discusses predictions, expectations, beliefs, plans, projections, objectives, assumptions, future events or performance (often but not always using phrases such as "expects", or "does not expect", "is expected", "anticipates" or "does not anticipate", "plans", "budget", "scheduled", "forecasts", "estimates", "believes" or "intends" or variations of such words and phrases or stating that certain actions, events or results "may" or "could", "would", "might" or "will" be taken to occur or be achieved) are not statements of historical fact and may be forward-looking statements.

Forward-looking statements contained in this press release include, without limitation, statements regarding the business and operations of Cerrado. In making the forward-looking statements contained in this press release, Cerrado has made certain assumptions, including, but not limited to completing the feasibility study and securing UKEF's support for the Mont Sorcier Project and the Monte Do Carmo Project, raising sufficient funds to cover the balance of project capital expenditures not covered by project financing, other conditions of closing a transaction with UKEF and TD including but not limited to those described in this news release and appointing an MLA for the Monte Do Carmo Project. Although Cerrado believes that the expectations reflected in forward-looking statements are reasonable, it can give no assurance that the expectations of any forward-looking statements will prove to be correct. Known and unknown risks, uncertainties, and other factors which may cause the actual results and future events to differ materially from those expressed or implied by such forward-looking statements. Such factors include, but are not limited to general business, economic, competitive, political and social uncertainties. Accordingly, readers should not place undue reliance on the forward-looking statements and information contained in this press release. Except as required by law, Cerrado disclaims any intention and assumes no obligation to update or revise any forward-looking statements to reflect actual results, whether as a result of new information, future events, changes in assumptions, changes in factors affecting such forward-looking statements or otherwise. Forward-looking information is subject to a variety of risks and uncertainties, which could cause actual events or results to differ from those reflected in the forward-looking information, including, without limitation, the risks described under the heading "Risks and Uncertainties" in the Company's most recent Management's Discussion and Analysis and other risks identified in the Company's filings with Canadian securities regulators, which filings are available on SEDAR at www.sedar.com. The risk factors referred to above are not an exhaustive list of the factors that may affect any of the Company's forward-looking information. The Company's statements containing forward-looking information are based on the beliefs, expectations and opinions of management on the date the statements are made, and the Company does not assume any obligation to update such forward-looking information if circumstances or management's beliefs, expectations or opinions should change, other than as required by applicable law. For the reasons set forth above, one should not place undue reliance on forward-looking information.

SOURCE: Cerrado Gold Inc.

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FAQ

What is the purpose of appointing Toronto-Dominion Bank as the MLA for Cerrado Gold Inc. (CERT)?

The purpose is to lead the potential UKEF-supported project financing of up to $598 million for the Mont Sorcier Iron and Vanadium Project in Quebec.

What percentage of the expected project capital expenditures for the Mont Sorcier project will the UKEF-backed facility cover?

The UKEF-backed facility is expected to cover 70% of the project capital expenditures.

What are the requirements for the conclusion of project financing for the Mont Sorcier project?

The conclusion of project financing is subject to the completion of a bankable feasibility study, environmental impact assessment, and other requirements.