Home Workshops series Bluestone Announces US$30 Million Bridge Loan to Advance Cerro Blanco Gold Project

Bluestone Announces US$30 Million Bridge Loan to Advance Cerro Blanco Gold Project



VANCOUVER, BC, March 14, 2022 /CNW/ – Bluestone Resources Inc. (TSXV: BSR) (OTCQB: BBSRF) (“Bluestone” or the “Company”) is pleased to announce that it has established a $30,000,000 ready (the “To lend“) with Zebra Holdings and Investments S.à.rl, and Lorito Holdings S.à.rl (the “Lender“).

The Loan will provide for the withdrawal of funds by the Company in tranches of at least $1,000,000. Proceeds will be used primarily for general corporate purposes and to advance the Cerro Blanco gold project through engineering and permitting approvals.

Peter HemsteadChief Financial Officer, said, “We are delighted to have the support of the Lundin family as we advance the Cerro Blanco project through engineering and design and invest in local project readiness initiatives. The Cerro Blanco project will generate significant benefits for Guatemala and our stakeholders over the life of the mine, and the loan demonstrates the Lundin Group’s commitment to developing the project in a socially and environmentally responsible way. The bridge loan will also give us the opportunity to move forward and optimize a complete financial package for the construction of the project.”

In consideration for the Loan, the Company issued 150,000 ordinary shares of the Company (the “Initial actions“) and will issue an additional 4,000 common shares per month (prorated for partial months) for each $1,000,000 of the Principal Amount Outstanding under the Loan from time to time until March 11, 2023 (the “Due date“), the number of such Common Shares to be calculated on the last day of each month until the Maturity Date (the “Additional Shares” and with the Initial Actions, the “Bonus actions“). The issuance of free shares to the lender is subject to final approval by the TSX Venture Exchange. All free shares issued to the lender will be subject to a four-month hold period under securities laws. applicable.

Since the Lender and its affiliates beneficially own, or control or direct, directly or indirectly, more than 10% of the Company’s common stock, the issuance of the Free Shares will be a “related party transaction”. under the multilateral instrument. 61-101- Protection of holders of minority securities during special operations (“MI 61-101“). The issuance of the free shares will be exempt from the formal valuation requirements of NI 61-101 pursuant to Section 5.5(b), as the Company’s shares are not listed on a specified market, and from the requirements Minority Approval of MI 61-101 pursuant to Sections 5.7(1)(a), as neither the fair market value of the Free Shares to be issued nor the consideration to be received for such shares exceeds 25% of the market capitalization of the Company, and 5.7(1)(f) as the Loan has no equity or voting rights and is on reasonable commercial terms which are no less advantageous to the Company than if the Loan had been obtained from of an arm’s length party.

About Bluestone Resources
Bluestone Resources is a Canadian precious metals exploration and development company focused on opportunities in Guatemala. The Company’s flagship asset is the Cerro Blanco Gold Project, a near-surface mining development project located in Southern Guatemala in the department of Jutiapa. The Company has released the results of a feasibility study for the project, describing an asset capable of producing over 300 koz/yr at head grades of +2.0 g/t gold. The project will produce 2.6 million ounces of gold over the life of mine at an all-in sustaining cost of $629/oz (as defined by World Gold Council guidelines, less corporate general and administrative costs) over an initial life of 14 years. The Company trades under the symbol “BSR” on the TSX Venture Exchange and “BBSRF” on the OTCQB.

On behalf of Bluestone Resources Inc.

“Jack Monday”

Jack Lundin | Chairman and Chief Executive Officer and Director

Neither the TSX Venture Exchange Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

Forward-looking statements
This press release contains “forward-looking information” within the meaning of Canadian securities laws and “forward-looking statements” within the meaning of the United States Private Securities Litigation Reform Act of 1995 (collectively, “forward-looking statements”). All statements, other than statements of historical fact, that address activities, events or developments that Bluestone Resources Inc. (“Bluestone” or the “Company”) believes, expects or anticipates will occur or may occur in the future, including, but not limited to: the use of Loan proceeds; final approval from the TSX Venture Exchange; the project’s estimated gold production volume per year; the quantities of gold production over the life of the mine; all-in average sustaining costs (“AISC”); and the initial life of the mine.

All forward-looking statements are made based on Bluestone’s current beliefs as well as various assumptions made by Bluestone and information currently available to Bluestone. Generally, these assumptions include, among others: the presence and continuity of metals at the Cerro Blanco project at estimated grades; the availability of personnel, machinery and equipment at estimated prices and within estimated delivery times; change rate; assumed metal selling prices and exchange rates; appropriate discount rates applied to cash flows in economic analyses; tax rates and royalty rates applicable to proposed mining operations; the availability of acceptable funding; the impact of the novel coronavirus (COVID-19); anticipated mining losses and dilution; success in completing the proposed transactions; and the expected timelines for community consultations and the impact of these consultations on the regulatory approval process.

Forward-looking statements are subject to a number of risks and uncertainties that could cause Bluestone’s actual results to differ materially from those discussed in the forward-looking statements and, even if such actual results are achieved or substantially achieved, there there can be no assurance that they will have the expected consequences or effects on Bluestone. Factors that could cause actual results or events to differ materially from current expectations include, among others: potential changes in the mining method and current development strategy; risks and uncertainties related to expected production rates; production schedule and quantity and total production costs; risks and uncertainties relating to the ability to obtain, modify or maintain necessary licenses, permits or surface rights; risks associated with technical difficulties associated with mining development activities; risks and uncertainties relating to the accuracy of mineral resource estimates and estimates of future production, future cash flows, total production costs and declining quantities or qualities of mineral resources; changes in project parameters as plans continue to be refined; the title matters; risks related to geopolitical uncertainty and political and economic instability Guatemala; risks related to global epidemics or pandemics and other health crises, including the impact of the novel coronavirus (COVID-19); risks and uncertainties related to production interruptions; risks related to Project working conditions, accidents or labor disputes; the possibility that future exploration, development or mining results will not meet Bluestone’s expectations; uncertain political and economic environments and relationships with local communities and government authorities; risks relating to variations in mineral grade and grade within mineral resources identified as mineral resources from those expected; variations in recovery and extraction rates; developments in world metals markets; and risks related to fluctuations in commodity prices and exchange rates. For a more in-depth discussion of the risks relevant to Bluestone, see “Risk Factors” in the Company’s Annual Information Form for the year ended December 31, 2020available on the Company’s SEDAR profile at www.sedar.com.

Any forward-looking statement speaks only as of the date on which it is made, and except as required by applicable securities laws, Bluestone disclaims any intention or obligation to update any forward-looking statement, whether as a result of new information, future events or results, or otherwise. Although Bluestone believes that the assumptions inherent in forward-looking statements are reasonable, forward-looking statements are not guarantees of future performance and, accordingly, undue reliance should not be placed on such statements due to their inherent uncertainty. There can be no assurance that forward-looking statements will prove to be accurate, and actual results and future events could differ materially from those anticipated in such statements.

Non-GAAP Financial Performance Measures
The Company has included in this press release a non-Generally Accepted Accounting Principles (“GAAP”) measure that is not defined by International Financial Reporting Standards (“IFRS”), namely AISC per ounce. of payable gold sold. Non-GAAP measures do not have any standardized meaning prescribed by IFRS and, therefore, may not be comparable to similar measures used by other companies. The Company believes that these measures, in addition to measures prepared in accordance with GAAP, provide investors with a better ability to assess the Company’s underlying performance and compare it to information reported by other companies. Non-GAAP measures are intended to provide supplemental information and should not be considered in isolation or as a substitute for performance measures prepared in accordance with GAAP. These measures do not have any standardized meaning prescribed by GAAP and therefore may not be comparable to similar measures presented by other issuers.

All-in to support costs
The Company believes that AISC more fully defines the total costs associated with gold production. The Company calculates AISC as the sum of refining costs, third-party royalties, site operating costs, sustaining capital costs and closure capital costs, all divided by ounces of gold sold to arrive at an amount per ounce. Other companies may calculate this measure differently due to differences in underlying principles and applied policies. Differences can also arise due to a different definition of maintaining capital versus non-maintaining capital.

AISC reconciliation
AISC and costs are calculated based on definitions published by the World Gold Council (“WGC”) (a market development organization for the gold industry comprised of and funded by 18 gold mining companies from around the world ). The WGC is not a regulatory body.

SOURCE Bluestone Resources Inc.

For further information: Bluestone Resources Inc., Stephen Williams | VP Corporate Development & Investor Relations, Phone: +1 604-757-5559, [email protected]www.bluestoneresources.ca