Eagle Gold Project

On March 8, 2018, Victoria Gold Corp. (“Victoria”) announced that it entered into documentation with Orion Mine Finance (“Orion”), Osisko Gold Royalties Ltd (“Osisko”) and Caterpillar Financial Services Limited (“Caterpillar Financial”) in connection with a construction financing package that will fully fund the development of the Eagle Gold project through to commercial production, totalling approximately C$505 million in aggregate.

The financing comprised of

• two credit facilities totalling US$175 million (approximately C$219 million)
• an equipment financing facility for up to US$50 million (C$63 million)
• a C$98 million royalty financing
• a C$125 million private placement of Victoria common shares to two separate subscribers

Credit Facilities

In connection with the financing, Victoria finalized arrangements with Orion for the provision of two credit facilities.

The US$100 million subordinated debt facility to be available for a period of two years from the closing of the financing at an interest rate of 3-month LIBOR plus 6.70%. It has a two-year interest holiday during which interest will accrue and be capitalized reducing cash payments for Victoria during the construction period, with the principal due at maturity on March 31, 2024.

The US$75 million senior secured project finance debt facility will be available from the date the secured subordinated loan facility is fully drawn until two years post-closing. It has an interest rate of 3-month LIBOR plus 5.00% with two-year interest holiday in-line with the subordinated debt facility. The principal and accrued interest will be repayable in 15 quarterly installments beginning 24 months after the closing of the facility.

Equipment Finance Facility

Separately, Victoria has executed a term sheet with Caterpillar Financial for a proposed six-year, amortizing equipment finance facility of up to US$50 million that will be used primarily to support the acquisition of new Cat® equipment.

Royalty Agreement

As part of the financing, Victoria also executed a term sheet with Osisko for the sale of a 5% net smelter return (“NSR”) royalty on all metals and minerals produced from the Dublin Gulch property, which includes both the Eagle and Olive deposits, for aggregate proceeds of C$98 million. The 5% NSR applies until an aggregate of 97,500 ounces of refined gold has been delivered to Osisko, after which a 3% NSR royalty will apply.

Equity Private Placements

Both Orion and Osisko agreed to subscribe for a total of 250,000,000 common shares of Victoria, on a private placement basis, at a price of C$0.50 per share for aggregate combined proceeds of approximately C$125 million.

• Orion indirectly subscribed for 150,000,000 of the newly issued shares through Orion Co-VI Ltd., a corporation controlled by Orion Mine Finance Management II Limited, accounting for C$75 million of the aggregate proceeds.
• Osisko subscribed for the remaining 100,000,000 shares for C$50 million of the aggregate proceeds.

In connection with the financings, which both closed separately on April 16, 2018, Orion also received warrants to purchase 25,000,000 common shares at a purchase price of C$0.625 per share until April 13, 2023, provided the exercise would not result in Orion holding more than 19.99% of the outstanding common shares on an undiluted basis.

Orion also entered into a cash-settled European gold call option certificate with Victoria with respect to options on 20,000 ounces of refined gold exercisable by Orion Co-VI at a price of US$1485 per troy ounce, settled on April 13, 2023, as well as a gold offtake agreement with Victoria entitling Orion Co-VI to purchase 25% of the gold production from the Eagle Gold project, based on the terms set out in the agreement.

Further information can be found on Globe Newswire's website.

Victoria Gold is a leading gold exploration and development company.

Orion is a mining-focused investment business with approximately US$4.50 billion under management (as of January 31, 2018) specializing in providing comprehensive and customized capital investment solutions to mining companies.

Osisko is an intermediate precious metal royalty company focused on the Americas. It holds a North American focused portfolio of over 130 royalties, streams and precious metal offtakes.

Caterpillar Financial provides retail and wholesale financing solutions and extended protection products to Cat customers and dealers for the complete line of Cat machinery and engines, Solar® gas turbines, other related equipment and marine vessels.