The facility has a 30-month repayment term, and bears an interest rate of London interbank offered rate plus 7.75%.
The company will issue 4,250,000 shares to Sprott in connection with the loan. The facility was secured against assets of Cardinal and its Cardinal Namdini Mining Ltd. subsidiary.
Cardinal plans to use the proceeds for working capital and to complete the preliminary and definitive feasibility studies for its Namdini gold project in Ghana, where a recent preliminary economic assessment confirmed the project’s viability to be a technically and financially robust, low-cost mining opportunity.
The company plans to deliver the Namdini definitive feasibility study in the third quarter of 2019.
The facility remains subject to satisfactory documentation and other customary conditions precedent, which are expected to be completed by Aug. 17.