otso stock

Otso Gold Obtains Creditor Protection Under the Companies' Creditors Arrangement Act

Trading Symbol: TSX-V: OTSO

 Otso Gold Corp. (" Otso " or the " Company "), (TSXV:OTSO) announced today it has obtained an order from the Supreme Court of British Columbia (the " Court ") granting protection from creditors under the Companies' Creditors Arrangement Act ( Canada ) (" CCAA ") to enable the Company to propose a plan of arrangement to its creditors.

After careful consideration of all available alternatives following thorough consultation with its legal and financial advisors, the Board of Directors of the Company determined that it was in the best interests of the Company and all of its stakeholders to file for an application for creditor protection under the CCAA.

The initial Court order provides for a stay of creditor claims with a view to provide the necessary protection to continue the Company's ongoing review process following the previously announced appointment of Alvarez & Marsal Nordic AB to provide Chief Restructuring Officer (" CRO ") and other services to the Company.

The CRO will remain responsible for the day-to-day operations of the Company and that the Board of Directors will remain intact. The Company is committed to completing the restructuring process quickly and efficiently.

The Court has appointed Deloitte LLP to serve as the Monitor in the CCAA proceedings to oversee the operations of the Company and report to the Court during the restructuring. The Company hopes to exit CCAA protection well-positioned to rebuild its stakeholders' trust and continue efforts to return the Otso Gold Mine to full commercial production.

Trading in the common shares of the Company on the TSX Venture Exchange (the " TSXV ") has been halted and it is anticipated that the trading thereof will continue to be halted until a review is undertaken by the TSXV regarding the suitability of the Company for listing on the TSXV. Should the common shares be delisted following such review by the TSXV, the Company may apply for listing of the common shares on the NEX Board of the TSXV or relisting on the TSXV upon exiting the CCAA process, as the case may be. In addition, the Company anticipates that, as a result of the Company's filing for protection under the CCAA and its potential delisting by the TSXV, provincial securities regulators in Canada may issue a cease trade order to prevent any trading in the common shares in Canada .

A comeback hearing in respect of the relief granted pursuant to the Initial Order will be scheduled within ten days (the " Comeback Hearing "). Interested parties that wish to bring a motion at the Comeback Hearing are required to provide notice to the affected parties prior to the Comeback Hearing pursuant to the requirements set forth in the Initial Order. A copy of the Initial Order and other information will be available on the Monitor's website at www.insolvencies.deloitte.ca/en-ca/otsogoldcorp.

Further news releases will be provided on an ongoing basis throughout the CCAA process as required by law or otherwise as may be determined necessary by the Company or the Court.

The Company's operating subsidiary Otso Gold Oy, a Finnish limited liability company, has made an equivalent filing for the commencement of restructuring proceedings under the Finnish Restructuring Act in Finland . Otso Gold Oy has requested interim protection from its creditors for the duration of the court review of its application. The stay, which is effected upon the commencement of restructuring proceedings but can be effected on an interim basis already upon filing for restructuring, prohibits the repayment of existing debts as well as the collection and enforcement, whether by legal means or otherwise, of such debts. The enforcement of any securities provided by the company is also prohibited. The court review of Otso Gold Oy's application is expected to take several weeks.

Following the abrupt departure of Lionsbridge Pty Ltd on 30 November 2021 the Company continues to investigate certain management practices, accounting issues and transactions, including for compliance with the Company's internal policies, legal and ethical standards.  The Company will update the market on the results of this investigation, including with respect to any further significant matters.

Forward-looking Statements

This press release contains forward-looking statements regarding the Company based on current expectations and assumptions of management, which involve known and unknown risks and uncertainties associated with our business and the economic environment in which the business operates. All such statements are forward-looking statements under applicable Canadian securities legislation, and any other applicable law or regulation of any other jurisdiction. Any statements contained herein that are not statements of historical facts, including statements regarding our future results of operations or financial condition, business strategy and plans and objectives for future operations, may be deemed to be forward-looking statements. Specific forward-looking statements in this press release include, but are not limited to: statements with respect to: (i) the outcome of the CCAA proceedings and/or any related restructuring proceedings and the timing of any such proceedings, (ii) the ability of the Corporation to secure additional financing as part of the CCAA process or otherwise, and (iii) the halt of trading of the common shares and review of the TSXV regarding the suitability of the Corporation for listing on the TSXV and any outcome of such review. By their nature, forward-looking statements require us to make assumptions and are subject to inherent risks and uncertainties. You should not rely on forward-looking statements as predictions of future events.  We caution our readers of this press release not to place undue reliance on our forward-looking statements as a number of factors could cause actual results or conditions to differ materially from current expectations. The results, events and circumstances reflected in the forward-looking statements may not be achieved or occur, and actual results, events or circumstances could differ materially from those described in the forward-looking statements.  Please refer to the risks set forth in the Company's continuous disclosure documents that can be found on SEDAR ( www.sedar.com ) under the Company's issuer profile. New risks and uncertainties emerge from time to time, and it is not possible for us to predict all risks and uncertainties that could have an impact on the forward-looking statements contained in this press release. In addition, there is no assurance that there will be any residual value for shareholders under the CCAA process, nor can be no assurance that the CCAA proceedings will result in the maximization of the return in respect of the Corporation's assets and those of its subsidiaries. The Company does not intend, and disclaims any obligation, except as required by law, to update or revise any forward-looking statements whether as a result of new information, future events or otherwise.

About the Company

Otso Gold Corp. wholly owns the Otso Gold Mine near the Town of Raahe in Finland . The

Otso Gold Mine is developed, fully permitted, has all infrastructure in place, two open pits and is currently in the ramp-up towards commercial production at name plate capacity of 2 million tonnes per annum.

Neither the TSX Venture 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.

SOURCE Otso Gold Corp.

View original content: https://www.newswire.ca/en/releases/archive/December2021/03/c4989.html

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Otso Gold

Otso Gold

Overview

Otso Gold Corp (TSXV:OTSO) is a gold company nearing production at its wholly-owned Otso Gold Mine in the premiere mining jurisdiction of Finland. The past operating mine complex, which includes the 2 million tonne per annum processing plant, is fully built, licensed, and permitted. The company has advanced through a phased redevelopment plan that is reaching its conclusion with the return to long-term, sustainable production. Moving forward, Otso Gold will launch an extensive exploration and drilling program across the lease areas with a view to expand the life of mine.

The redevelopment plan was centered on gaining an in-depth understanding of the mine areas to inform a comprehensive mine plan. Otso Gold Corp understands that a successful restart is contingent on a robust mine plan and in-depth knowledge of the deposit’s geology. Importantly, Otso Gold have built a team of diverse and highly skilled technical professionals to carry out each phase of the redevelopment plan and sustain production.

Located in Finland, Otso Gold operates within one of the world’s leading mining jurisdictions. In 2018, Forbes ranked Finland as the world’s second-best country for property rights while the Fraser Institute ranked Finland third-best in the world for mining policies, owing to the government’s support of mineral exploration and production. Finland has a 20 percent corporate tax rate and gold producers pay a low royalty of 0.15 percent. Otso Gold seek to leverage technological innovation and ESG standards to promote sustainable mining practices. This includes;

  • Over 70 percent of power is carbon neutral
  • In partnership with Neste, all vehicles on site will run on renewable diesel
  • Advanced, continuous environmental monitoring systems across the site.

Otso Gold received US$11.155 million from the exercise of 284,944,440 common share purchase warrants previously issued to Brunswick Gold Ltd (“Brunswick Gold”) on a private placement basis on February 8, 2021. The Company allocated the proceeds  from  the  exercise  of  the Warrants  toward continuing the Company’s return to production of the Otso Gold Mine, targeted in Q3.

Otso Gold’s Company Highlights

  • Executed redevelopment plan nearing completion in Q3, 2021.
  • Over 70% of power is carbon neutral with cutting-edge environmental monitoring systems in place.
  • Well-funded, fully-permitted and licensed past-producing mine.
  • Low-cost mining operation with two open pits and a 2 million tonne per annum processing plant.
  • Proven recoveries of 87.5 percent.
  • Further exploration potential.
  • Received US$11.155 million to start production of its Otso Gold Mine

Otso Gold’s Flagship Project

Bringing Finland’s Otso Gold Mine Back into Production

The fully-built Otso Gold Mine is located near the town of Raahe, Finland. The access to skilled labor and infrastructure in this established mining jurisdiction directly benefits the Otso Gold Mine. Infrastructure includes low-cost power on-site, a network of paved all-weather roads leading to the mine site, a seaport within twenty minutes and an airport within an hour of the mine site. The €250 million Otso Gold Mine operation includes two developed pits and a completely built 2 million-tonne throughput process plant designed by Metso and Outotec.

The well-defined mineralized zone on the Otso Gold Mine is one of the largest gold resources in the region.

*The materials remaining in the low-grade stockpile from the previous production has been included in the measured category as it is ready to be fed to the mill at start-up. The sulphidic waste rock dump (potentially acid-forming) is included in the inferred category of the estimate as it is considered to be above the planned cut-off grade of 0.3 g/t Gold.

Mine and processing plant

The Otso Gold Mine operation consists of two open pits: the 50-meter-deep North Pit and the 25-meter deep South Pit. Otso Gold Corp’s mine plan emphasizes grade control and reconciliation. Conservative estimates for mining costs come in at €506 per gold ounce.

The plant has a proven operating recovery of 87.5 percent gold at a process cost of €305 per gold ounce. Having already operated in 2019, the processing plant is production-ready with minimal CAPEX required to return to production.

Otso Gold’s Management Team

Vladimir Lelekov – Chairman of the Board

Mr. Lelekov currently serves as Chairman of Brunswick Rail, the largest railcar operating leasing company in Russia. Prior thereto, Mr. Lelekov was CEO of Brunswick Rail from 2006 to February 2013 and returned to the company in May 2017. In 2014, Mr. Lelekov acquired an interest in OOO “Liga-Trans” (one of the largest companies in the sector of collection and environmentally friendly waste disposal) and assumed the position of the Chairman of the Board of the company until 2017.

Brian Wesson – President, Chief Executive Officer & Director

Mr. Brian Wesson has extensive experience spanning a career of over 40 years in the management, operation design and construction of natural resource operations globally. He qualified as an engineer in South Africa, gained an MBA in Australia, studied Economics at the University of South Africa and is a fellow of the Australasian Institute of Mining and Metallurgy and a fellow of the Australian Institute of Company Directors.

Clyde Wesson – Vice-President and Director

Clyde Wesson has significant experience in all aspects of the management of corporate entities, both listed and unlisted. His expertise includes the restructuring and recapitalizing of distressed assets, corporate finance, design and execution of corporate strategy, legal management and bringing assets to market. Wesson holds bachelor’s degrees in both Law and Commerce (LLB, B.Com) and is currently a candidate for a Master’s of Law (LLM) from Melbourne University (2019). He is a solicitor and member of the Supreme Court of NSW and a member of the Australian Institute of Company Directors, Australian Institute of Mining and Metallurgy and the Law Society of NSW.

Yvette Harrison – Chief Financial Officer

Ms. Harrison is a Chartered Professional Accountant with over 20 years of experience in permanent positions as well as in bridge leadership consulting roles with organisations in “immediate-need” situations in mining, real estate investments, technology, forest products, manufacturing and not-for-profit. She has worked as Chief Financial Officer, VP Finance, Director Finance, Controller and Consultant with numerous public and private companies as well as not-for-profits. She also has worked in public practice. Ms. Harrison received her CGA designation from the Certified General Accountants Association of British Columbia in 2002.

Nicolas Pascault – Director

Mr. Pascault serves as CEO of Brunswick Rail, the largest railcar operating leasing company in Russia, a position he has held since November, 2016. Mr. Pascault joined Brunswick Rail in 2004 as Managing Partner and CFO. In January 2015, Mr. Pascault assumed the position of Deputy CEO, reporting directly to the Chairman, and was asked by the Board to support a bond restructuring. Prior thereto, Mr. Pascault served as CFO of Danone Group in Russia from 1998 to 2004 and, from 1990 to 1998, Mr. Pascault worked at Ernst & Young in Moscow, St. Petersburg and Paris in the Audit and Corporate Finance Department. Mr. Pascault graduated from the Institut d’Etudes Politiques of Paris and holds a Master of Finance degree from the University of Paris II.

Victor Koshkin – Director

Mr. Koshkin serves as General Director of Brunswick Rail Management, a management company for Brunswick Rail, the largest railcar operating leasing company in Russia. Prior thereto, from 2003 to 2010, Mr. Koshkin worked in Moscow as CFO at Integrated Energy Technologies, Deputy Head of Business Development at SUAL, and adviser to shareholders of MDM Group. Mr. Koshkin served on the board of privately owned Samara Transformer. Prior to that, from 1996 to 2001, Mr. Koshkin worked as an investment banker at JP Morgan and Lehman Brothers in New York. Mr. Koshkin holds an MBA degree from Harvard Business School and a BA degree in Economics from Wabash College.

Martin Smith – Independent Director

Mr. Smith is an Independent Mining Consultant with over 40 years’ experience in open pit mining. From 2006 to 2015, Mr. Smith was Technical Director of Petropavlovsk Plc (formerly Peter Hambro Mining) based in the Russian Far East and overseeing three large open pit gold mines and their associated processing plants producing c.500,000 ounces of gold per year. Prior thereto, Mr. Smith worked as Country Director for Joy/P&H in India; General Manager of Comedat Phosphate in Jordan and Chief Mining Engineer for Costain Mining Ltd. Martin holds a BSc in Mining Engineering from the Royal School of Mines, Imperial College of Science, London.

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