Lake Victoria Gold to secure $750,000 CAD through convertible loan issuance

Lake Victoria Gold (TSX-V:LVG; FRA: E1K) has announced its intention to issue up to $750,000 of unsecured convertible debt. This is intended to provide the company with financial flexibility while avoiding major dilution at the current share price. The company makes it clear that taxes due to the Tanzanian state have already been paid. At the same time, the Tax Clearance Certificate from the Tanzanian Revenue Authority (TRA), which is required for the final transfer of the Imwelo mining license, is expected in the coming days.

Each debenture will bear interest at 12% per annum, payable quarterly, with interest payable in cash or ordinary shares of the Company at the Company’s option. Each Debenture will mature 24 months from the date of issuance. The Company intends to use the proceeds from the Private Placement for general working capital purposes.

The outstanding principal amount of each Debenture is convertible at the option of the holder into common shares of the Company at a conversion price of $0.18 per share at any time prior to the maturity date. The Debentures are subject to a mandatory conversion provision whereby the Company may, at its option, convert the outstanding principal amount of the Debentures into Shares at the conversion price if the Shares trade at a closing price in excess of $0.275 on the Exchange at any time after the first year following the date of issuance of the Debentures and prior to the Maturity Date for a period of 20 consecutive trading days.

Major step forward

Marc Cernovitch, CEO & Director, stated: “Having received the recently announced tax assessment from the Tanzania Revenue Authority (“TRA”) and having made the relevant payments, we expect to receive the Tax Clearance Certificate from the TRA in the coming days. Once the Tax Clearance Certificate is received, the Company can submit its final applications to the Mining Commission to finalize the acquisition of Imwelo. This decisive step will not only finalize our acquisition, but also trigger the second investment tranche of the TAIFA Group. This acquisition is a significant milestone for LVG and represents a major step forward in our strategic growth and consolidation plans within the Lake Victoria Goldfields.”

Conclusion: Lake Victoria Gold has been deeply rooted in Tanzania for more than ten years. The Imwelo project and the neighboring Dora project both have the potential for significant growth. The Tanzanian Taifa Group, through its wholly owned subsidiary Taifa Mining, will carry out all contract mining and construction work for the Imwelo project. Taifa Mining is the largest mining company in Tanzania with over 30 years of experience in mining. Taifa Group is already a major shareholder in Lake Victoria Gold. After the transfer of the Imwelo license, Taifa’s share is due to increase significantly again, so that it fair to say that the Canadian listed Lake Victoria Gold will also be a Tanzanian company at the same time. There can hardly be a better intrinsic motivation for LVG’s success.