Contango Silver & Gold Inc. has amended its Credit and Guarantee Agreement, increasing its term loan facility by approximately $33 million. The company used the proceeds to terminate its remaining required gold hedge agreements covering 15,000 ounces, providing full exposure to future gold prices. The amendment also reduces the applicable interest margin on the loan.
Key Details
- Financing: Increased the principal amount of term loans by approximately $33 million, with the proceeds used to fund the hedge termination and purchase new put options.
- Hedge Restructuring: Terminated required hedge agreements covering 15,000 ounces of gold scheduled for delivery in March and June 2027. The company then purchased put option contracts for the same amount of gold to establish price protection.
- Improved Terms: The applicable margin on the Credit Agreement was reduced from 5.00% to 3.63% per annum.
- Repayment Schedule: The new term loans are scheduled for repayment in installments, with approximately $15.5 million due March 31, 2027, and $28.8 million due June 30, 2027.