DENVER, CO, May 17, 2012 (MARKETWIRE via COMTEX) --Golden Star Resources Ltd. (NYSE MKT: GSS) (NYSE Amex: GSS) (TSX:
GSC) (GHANA: GSR) ("Golden Star" or the "Company") today announced
that it has entered into certain definitive agreements to purchase an
aggregate of $74.5 million of the principal outstanding under its
4.00% Convertible Senior Unsecured Debentures due November 30, 2012
(the "Original Debentures"), by way of privately negotiated
transactions with certain holders of Original Debentures (the
"Holders"). After purchasing and cancelling $74.5 million of Original
Debentures, an aggregate of $50.5 million principal amount of
Original Debentures will remain outstanding.
As consideration for purchasing $74.5 million of Original Debentures,
the Company will issue an aggregate of approximately $77.5 million
principal amount of 5.00% Convertible Senior Unsecured Debentures due
June 1, 2017 (the "New Debentures"). The Company will issue the New
Debentures in transactions exempt from the registration requirements
of the U.S. Securities Act of 1933, as amended (the "Securities
Act").
Interest on the New Debentures will be payable semi-annually in
arrears on June 1 and December 1 of each year, beginning December 1,
2012, and continuing until maturity. Each New Debenture will be,
subject to certain limitations, convertible into common shares at a
conversion rate of 606.0606 common shares per $1,000 principal amount
of New Debentures (equal to an initial conversion price of $1.65 per
share), or approximately 25% above the closing price of the Company's
common shares on the NYSE MKT (formerly NYSE Amex) on May 17, 2012,
the last full trading day prior to entry into the agreement, subject
to adjustment in certain circumstances. The New Debentures will not
be redeemable at the Company's option, except in the event of certain
change in control transactions where 90% or more of the outstanding
New Debentures have accepted a mandatory offer to purchase by the
Company.
The New Debentures will be direct senior unsecured indebtedness of
the Company, ranking equally and ratably with all other senior
unsecured indebtedness and senior to all subordinated indebtedness.
None of the Company's subsidiaries will guarantee the New Debentures,
and the New Debentures will not limit the amount of debt that the
Company or its subsidiaries may incur.
The closing of the transaction is expected to occur on or about May
31, 2012, subject to receipt of regulatory approvals and other
customary closing conditions, and should provide the Company with
additional financial flexibility for accomplishing its near- and
mid-term growth objectives.
All references to "$" in this press release are to United States
dollars.
This announcement does not constitute an offer to sell, nor is it a
solicitation of an offer to buy, securities. The New Debentures, and
the common shares issuable upon conversion of the New Debentures,
will not be registered under the Securities Act or the securities
laws of any other jurisdiction, and may not be offered or sold in the
United States without registration under, or an applicable exemption
from, the registration requirements of the Securities Act.
COMPANY PROFILE
Golden Star Resources holds the largest land package in one of the
world's largest and most prolific gold producing regions. The Company
holds a 90% equity interest in Golden Star (Bogoso/Prestea) Limited
and Golden Star (Wassa) Limited, which respectively own the
Bogoso/Prestea and Wassa/HBB open-pit gold mines in Ghana, West
Africa. In addition, Golden Star has an 81% interest in the currently
inactive Prestea Underground mine in Ghana, as well as gold
exploration interests elsewhere in Ghana, in other parts of West
Africa and in Brazil in South America. Golden Star has approximately
259 million shares outstanding. Additional information is available
at www.gsr.com.
Statements Regarding Forward-Looking Information: Some statements
contained in this news release are forward-looking statements within
the meaning of the Private Securities Litigation Reform Act of 1995
and other applicable securities laws. Investors are cautioned that
forward-looking statements are inherently uncertain and involve risks
and uncertainties that could cause actual results to differ
materially, including comments regarding the expectation that the
purchase and exchange will be completed consistent with the terms
outlined above, the anticipated closing date of the transaction, and
other statements that express management's expectations or estimates
of future developments, circumstances or results. Actual results may
differ materially from those presented. Factors that could cause
results to differ materially include fluctuations in gold price,
disruptions in U.S. and Canadian securities markets, and other
factors that may cause actual results, performance or achievements to
be materially different from those expressed or implied. Golden Star
assumes no obligation to update this information. Please refer to the
discussion of risk factors in our Form 10-K for the year ended
December 31, 2011.
For further information, please contact:
GOLDEN STAR RESOURCES LTD.
+1-800-553-8436
Bruce Higson-Smith
Senior Vice President Finance and Corporate Development
INVESTOR RELATIONS
Jay Pfeiffer
Pfeiffer High Investor Relations, Inc.
303-393-7044
SOURCE: Golden Star Resources