Kingold investor to receive up to 10.6 million shares via agreement

Stock loan and purchase agreement inked with Equities First Holdings

By Devika Patel

Knoxville, Tenn., Oct. 4 - Kingold Jewelry, Inc. negotiated a stock loan and purchase agreement with Equities First Holdings, LLC, according to a prospectus supplement filed Thursday with the Securities and Exchange Commission and a company news release.

The agreement will be drawn down in tranches. Each loan will have a tenor of three years and will bear interest at 4%.

The company has pledged 600,000 shares as collateral against the first loan and may pledge 10 million additional shares with future tranches. When a loan is repaid, Equities First Holdings will return the shares pledged as collateral.

The initial principal amount of each term loan will be equal to the number of shares pledged as collateral for that loan multiplied by 75% of the lower of (a) the last sale price of Kingold's common stock on the business day prior to delivery of the shares and (a) the average of the last sale prices for the three consecutive business days prior to delivery of the shares.

Based in Wuhan, China, Kingold designs, manufactures and sells gold jewelry.

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