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Almonty Industries Inc. (“Almonty”) (TSXV:AII) announces it has
completed its previously announced non-brokered private placement of a
secured convertible debenture in the principal amount of $4,000,000 (the
“Debenture Offering”) as well as an unsecured bridge financing of
$2,100,000 (the “Bridge Loan”), for combined total gross proceeds
of $6,100,000. The terms of the Debenture Offering and the Bridge Loan
are described in Almonty’s news release dated September 11, 2015. All
securities issued pursuant to the Debenture Offering are subject to
resale restrictions for a period of four months expiring on January 16,
2015. Almonty intends to use the net proceeds of the Debenture Offering
and the Bridge Loan for general corporate purposes and for the partial
repayment today of indebtedness of a subsidiary of Woulfe Mining Corp. (“Woulfe”),
a wholly-owned subsidiary of Almonty, as further described below.
Almonty will issue an additional news release upon closing of its
non-brokered private placement of common shares as described in its news
release dated September 11, 2015 (the “Equity Offering”).
In connection with the Debenture Offering and pursuant to the nomination
right granted to Deutsche Rohstoff AG (“DRAG”) thereunder (as
further described in Almonty’s news release dated September 11, 2015),
Dr. Thomas Gutschlag, the Chief Executive Officer of DRAG, has been
appointed to the board of directors of Almonty. DRAG is a public company
listed on the Frankfurt Stock Exchange which identifies, develops and
divests attractive resource projects in North America, Australia and
Europe, with a focus is on the development of oil and gas opportunities
within the United States, as well as metals such as gold, copper, rare
earth elements, tungsten and tin. Dr. Gutschlag co-founded DRAG in 2006
and has been its Chief Executive Officer since January 1, 2015 and prior
thereto its Chief Financial Officer. He is a qualified economist with a
degree in economics from the University of Heidelberg and a doctorate
from the University of Mannheim.
Almonty and Woulfe also announce that they have reached an agreement
today with TaeguTec Ltd. (“TaeguTec”) for an extension to March
31, 2016 of the existing indebtedness of Sangdong Mining Corp to
TaeguTec (in the outstanding principal amount of approximately CAD$11.33
million) previously due on September 15, 2015, subject to CAD$5.00
million thereof being repaid from the proceeds of the Debenture Offering
and the Bridge Loan on September 15, 2015, which partial repayment has
been made today.
The Debenture Offering constitutes a “related party transaction” within
the meaning of Multilateral Instrument 61-101 Protection of Minority
Security Holders in Special Transactions (“MI 61-101”). For
this transaction, Almonty relied on the exemption from the formal
valuation requirements of MI 61-101 contained in section 5.5(b) of MI
61-101 and on the exemption from the minority shareholder approval
requirements of MI 61-101 contained in Section 5.7(1)(a) of MI 61-101.
DRAG Early Warning Disclosure
DRAG acquired ownership and control of the Debenture, which is
convertible at the option of DRAG into common shares of Almonty at a
conversion price of $0.81 per share (and at the option of Almonty as
well at the same conversion price if Almonty raises at least $22,500,000
in equity capital pursuant to another offering).
DRAG has advised Almonty that, at present, it also owns and controls
12,209,302 common shares of Almonty, representing approximately 14.1% of
the issued and outstanding common shares of Almonty (being 86,600,419
shares), and it also owns another convertible debenture of Almonty in
the principal amount of $6,000,000 (the “Existing Debenture”)
having a maturity of 2.5 years with a coupon of 4%, and being
convertible at the option of DRAG into common shares of Almonty at a
conversion price of $1.45 per share.
In the event that the principal amount of the Debenture was converted,
DRAG would have ownership and control of an additional 4,938,271 common
shares of Almonty, representing approximately 5.4% of the then issued
and outstanding common shares of Almonty post-exercise, and ownership
and control over a total of 17,147,573 common shares of Almonty,
representing approximately 18.7% of the then issued and outstanding
common shares of Almonty post-exercise.
In the event that the principal amount of the Existing Debenture was
converted in full, and assuming the conversion of the Debenture, DRAG
would have ownership and control of an additional 4,137,931 common
shares of Almonty, representing approximately 4.3% of the then issued
and outstanding common shares of Almonty post-exercise, and ownership
and control over a total of 21,285,504 common shares of Almonty,
representing approximately 22.3% of the then issued and outstanding
common shares of Almonty post-exercise.
DRAG has advised Almonty that it acquired the Debenture for investment
purposes and has no present intention to acquire further securities of
Almonty, although it may in the future acquire or dispose of securities
of Almonty, through the market, privately or otherwise, as circumstances
or market conditions warrant.
A copy of the early warning report required to be filed by DRAG with
applicable securities commissions in connection with this acquisition
will be available for viewing under Almonty’s profile on SEDAR at www.sedar.com
and a copy of the early warning report may also be obtained by
contacting Thomas Gutschlag, the Chief Executive Officer of DRAG, at
Friedrich-Ebert-Anlage 24 DE-69117 Heidelberg Germany, Telephone +49
6221 871 000.
About Almonty Industries Inc.
The principal business of Toronto, Canada-based Almonty Industries Inc.
is the mining, processing and shipping of tungsten concentrate from its
Los Santos Mine in western Spain and its Wolfram Camp Mine in north
Queensland, Australia. The Los Santos Mine was acquired by Almonty in
September 2011 and is located approximately 50 kilometres from Salamanca
in western Spain and produces tungsten concentrate. The Wolfram Camp
Mine was acquired by Almonty in September 2014 and is located
approximately 130 km west of Cairns in northern Queensland, Australia
and produces tungsten and molybdenum concentrate. Almonty also has an
option to acquire a 100% ownership interest in the Valtreixal
tin-tungsten project in north western Spain. Further information about
Almonty’s activities may be found at www.almonty.com
and under Almonty’s profile at www.sedar.com.
About Woulfe Mining Corp. (a wholly-owned subsidiary of Almonty
Industries Inc.)
Woulfe Mining Corp., through its wholly-owned subsidiary Sangdong Mining
Corporation, is dedicated to developing the Sangdong tungsten-molybdenum
mine which was historically one of the largest tungsten mines in the
world and one of the few long life, high-grade tungsten deposits located
outside of China. Further information about Woulfe’s activities may be
found at www.woulfemining.com
and under Woulfe’s profile at www.sedar.com.
Neither TSX Venture Exchange nor its Regulation Services Provider (as
that term is defined in policies of the TSX Venture Exchange) accepts
responsibility for the adequacy or accuracy of this release.
Disclaimer for Forward-Looking Information
When used in this press release, the words “estimate”, “project”,
“belief”, “anticipate”, “intend”, “expect”, “plan”, “predict”, “may” or
“should” and the negative of these words or such variations thereon or
comparable terminology are intended to identify forward-looking
statements and information. This press release contains forward-looking
statements and information including combining these companies. These
statements and information are based on management’s beliefs, estimates
and opinions on the date that statements are made and reflect Almonty’s
current expectations.
Forward-looking statements in this news release include, but are not
limited to, statements regarding the completion of the Equity Offering
and the expected use of proceeds thereof. The forward-looking statements
and information in this press release include information relating to
the intentions of management. Such statements and information reflect
the current view of Almonty with respect to risks and uncertainties that
may cause actual results to differ materially from those contemplated in
those forward-looking statements and information. By their
nature, forward-looking statements involve known and unknown risks,
uncertainties and other factors and assumptions which may cause actual
results, performance or achievements, or other future events, to be
materially different from any future results, performance or
achievements expressed or implied by such forward-looking statements.
Investors are cautioned against attributing undue certainty to
forward-looking statements. When relying on Almonty’s forward-looking
statements and information to make decisions, investors and others
should carefully consider the foregoing factors and other uncertainties
and potential events.
Almonty has also assumed that material factors will not cause any
forward-looking statements and information to differ materially from
actual results or events. However, the list of these factors is not
exhaustive and is subject to change and there can be no assurance that
such assumptions will reflect the actual outcome of such items or
factors.
THE FORWARD-LOOKING INFORMATION CONTAINED IN THIS PRESS RELEASE
REPRESENTS THE EXPECTATIONS OF ALMONTY AS OF THE DATE OF THIS PRESS
RELEASE AND, ACCORDINGLY, IS SUBJECT TO CHANGE AFTER SUCH DATE. READERS
SHOULD NOT PLACE UNDUE IMPORTANCE ON FORWARD-LOOKING INFORMATION AND
SHOULD NOT RELY UPON THIS INFORMATION AS OF ANY OTHER DATE. WHILE
ALMONTY MAY ELECT TO, IT DOES NOT UNDERTAKE TO UPDATE THIS INFORMATION
AT ANY PARTICULAR TIME EXCEPT AS REQUIRED IN ACCORDANCE WITH APPLICABLE
LAWS.
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