(“Amaroq” or the
“Corporation” or the
"Company")
Closing of Debt Financing
TORONTO, ONTARIO – September 1, 2023 – Amaroq
Minerals Ltd. (AIM, TSXV, NASDAQ First North: AMRQ), an independent
mine development company with a substantial land package of gold
and strategic mineral assets in Southern Greenland, is pleased to
announce the successful closing of its previously announced US$50.9
million senior secured package (see press releases dated March 28,
2023 and August 11, 2023), consisting of:
(i) US$18.5
million senior debt term loans ("Senior Debt Term
Loans") pursuant to revolving credit facilities provided
by Landsbankinn hf. and Fossar Investment Bank
(“Fossar”);
(ii) A total
of US$22.4 million convertible notes (the "Convertible
Notes"), with US$16 million of Convertible Notes issued to
ECAM LP, US$4 million of Convertible Notes issued to JLE Property
Ltd. and US$2.4 million of Convertible Notes issued to Livermore
Partners LLC (the "Convertible Note Offering");
and
(iii) an
overrun loan from JLE Property Ltd. of up to US$10 million under a
revolving credit facility (the "Overrun Loan" and
together with the Senior Debt Term Loans, the
"Facilities").
Eldur Olafsson, CEO of Amaroq,
commented:
“I am pleased to announce the successful closing
of our debt funding package. This marks a further milestone for
Amaroq Minerals, enabling the transition to staged, full scale
production at the Nalunaq gold project. I would like to extend my
thanks to our investors and debt funding partners.
We are working with a highly qualified team of
professionals as we accelerate our progression to trial mining
activities. We now look forward to commencing the next stage of
operations at Nalunaq as we enter this new chapter.”
The Convertible Notes will bear interest at a
rate of 5% per annum and will mature on September 1, 2027, being
the date that is four years from the Convertible Note Offering
closing date. The principal amount of the Convertible Notes will be
convertible, in whole or in part, at any time from one month after
issuance into common shares of the Company ("Common
Shares") at a conversion price of Cdn$0.90 (£0.525) per
Common Share for a total of up to 33,629,068 Common Shares. The
Company may repay the Convertible Notes and accrued interest at any
time, in cash, subject to providing 30 days’ notice to the relevant
noteholders, with such noteholders having the option to convert
such Convertible Notes into Common Shares at the conversion price.
If the Company chooses to redeem some but not all of the
outstanding Convertible Notes, the Company shall redeem a pro rata
share of each noteholder's holding of Convertible Notes. The
Company shall pay a commitment fee to the holders of the
Convertible Notes of, in aggregate, US$4,484,032, which shall be
paid pro rata to each noteholder's holding of Convertible Notes.
The commitment fee is payable on the earlier of (a) the date
falling 20 business days after all amounts outstanding under the
Senior Debt Term Loans have been repaid in full, but no earlier
than the date that is 24 months after the date of issuance of the
Notes; and (b) the date falling 30 (thirty) months after the date
of the subscription agreement in respect of the Notes, irrespective
of whether or not Notes have converted at that date or been
repaid.
The Facilities have a two year term and will
bear interest at the CME Term SOFT Rates by CME Group Inc. and have
a margin of 9.5% per annum. The Landsbankinn hf. and Fossar
revolving credit facilities under the Senior Debt Term Loans
contain (i) a commitment fee of 0.40% per annum calculated on the
undrawn facility amount and (ii) an arrangement fee of 2.00% on the
facility amount where 1.5% is to be paid on or before the closing
date of such facility and 0.50% is to be paid on or before the
first draw down. The Overrun Loan contains a stand-by fee of 2.5%
on the amount of committed funds. The Facilities are not
convertible into any securities of the Company.
The Facilities and Convertible Notes will be
secured by (i) bank account pledge agreements from the Company and
Nalunaq A/S, (ii) share pledges over all current and future
acquired shares in Nalunaq A/S and Gardaq A/S held by the Company
pursuant to the terms of share pledge agreements, (iii) a proceeds
loan assignment agreement, (iv) a pledge agreement in respect of
owner’s mortgage deeds and (v) a licence transfer agreement.
The proceeds from the Convertible Notes and the
Facilities will be used to fund the transition of the Company’s
Nalunaq mining licence from a bulk sample trial mining development
plan to staged, full scale production of gold doré on site by
bringing forward construction of a processing plant and associated
infrastructure.
Related Party Transactions
Livermore Partners LLC
("Livermore") subscribed for US$2.4 million in
principal amount of Convertible Notes under the Convertible Note
Offering (the "Insider Participation"). The
subscription by Livermore is considered to be a "related party
transaction" for purposes of Multilateral Instrument 61-101 -
Protection of Minority Security Holders in Special Transactions
("MI 61-101"). The Insider Participation is exempt
from the formal valuation and minority shareholder requirements
under MI 61-101 in reliance upon the exemptions contained in
section 5.5(a) and 5.7(1)(a), respectively, of MI 61-101. The
Company did not file a material change report more than 21 days
before the expected closing date of the Convertible Note Offering
as the details of the Convertible Note Offering and the Insider
Participation was not settled until shortly prior to the closing of
the Convertible Note Offering, and the Company wished to close the
Convertible Note Offering on an expedited basis for sound business
reasons.
For the purposes of the AIM Rules for Companies,
Fossar, ECAM and Livermore are related parties of
Amaroq. Fossar is a company in which Sigurbjorn
Thorkelsson, Non-Executive Director of the Company, is Chairman of
the board and indirectly controls over 30% of the
capital. ECAM LP is an affiliate of GCAM LP, which owns a 49%
interest in Gardaq A/S, an Amaroq subsidiary, and has
appointed two directors to the subsidiary company
board. Livermore is a company in which David Neuhauser,
Non-Executive Director of Amaroq Minerals, is Managing
Director.
As such, the elements of the debt financing
with Fossar (US$1.0 million off the Senior Debt
Term Loans), Livermore Partners LLC (US$2.4
million of the Convertible Notes), and ECAM
LP (US$16.0 million of the Convertible Notes)
constitute Related Party Transactions in accordance with AIM Rule
13.
The Independent Directors, being the Amaroq
Directors other than Sigurbjorn
Thorkelsson and David Neuhauser, consider, having
consulted with the Company's Nominated Adviser, that the terms of
the transaction are fair and reasonable insofar as the Company's
shareholders are concerned.
The Convertible Note Offering is subject to
final acceptance of the TSX Venture Exchange.
Enquiries:
Amaroq Minerals Ltd.Eldur
Olafsson, Executive Director and CEOeo@amaroqminerals.com
Eddie Wyvill, Corporate Development+44 (0)7713
126727ew@amaroqminerals.com
Stifel Nicolaus Europe
Limited (Nominated Adviser and Broker)Callum
StewartVarun TalwarSimon MensleyAshton Clanfield+44 (0) 20 7710
7600
Panmure Gordon (UK)
Limited (Joint Broker)John PriorHugh RichDougie
Mcleod+44 (0) 20 7886 2500
Camarco (Financial PR)Billy
CleggElfie KentCharlie Dingwall+44 (0) 20 3757 4980For
Company updates:
Follow @Amaroq_minerals on TwitterFollow Amaroq
Minerals Inc. on LinkedIn
Further Information:
About Amaroq Minerals
Amaroq Minerals' principal business objectives
are the identification, acquisition, exploration, and development
of gold and strategic metal properties in Greenland. The Company's
principal asset is a 100% interest in the Nalunaq Project, an
advanced exploration stage property with an exploitation license
including the previously operating Nalunaq gold mine. The
Corporation has a portfolio of gold and strategic metal assets
covering 7,866.85km2, the largest mineral portfolio in
Southern Greenland covering the two known gold belts in the region.
Amaroq Minerals is incorporated under the Canada Business
Corporations Act and wholly owns Nalunaq A/S, incorporated
under the Greenland Public Companies Act.
This news release is not for release,
publication, distribution, directly or indirectly, in or into the
United States of America or any other jurisdiction in which such
release, publication or distribution would be unlawful. This news
release is for information purposes only and does not constitute an
offer to sell or issue, or a solicitation of an offer to buy,
subscribe for or otherwise acquire any of the securities described
herein in the United States of America (including its territories
and possessions, any state of the United States and the District of
Columbia (collectively, the “United States”)) or
any other jurisdiction in which such offer or solicitation would be
unlawful or to any person to whom it is unlawful to make such offer
or solicitation. The securities have not been and will not be
registered under the United States Securities Act of 1933, as
amended (the "U.S. Securities Act"), or any state
securities laws. The securities may not be offered or sold within
the United States, except pursuant to an applicable exemption from
the registration requirements of the U.S. Securities Act and in
compliance with any applicable securities laws of any state or
other jurisdiction of the United States.
Certain statements in this release constitute
"forward-looking statements" or "forward-looking information"
within the meaning of applicable securities laws, including but not
limited to, the expected use of proceeds from the Facilities and
Convertible Notes. Such statements and information involve known
and unknown risks, uncertainties and other factors that may cause
the actual results, performance or achievements of the company, its
projects, or industry results, to be materially different from any
future results, performance or achievements expressed or implied by
such forward-looking statements or information. Such statements can
be identified by the use of words such as "may", "would", "could",
"will", "intend", "expect", "believe", "plan", "anticipate",
"estimate", "scheduled", "forecast", "predict" and other similar
terminology, or state that certain actions, events or results
"may", "could", "would", "might" or "will" be taken, occur or be
achieved. These statements reflect the Company's current
expectations regarding future events, performance and results and
speak only as of the date of this release.
Forward-looking statements and information
involve significant risks and uncertainties, should not be read as
guarantees of future performance or results and will not
necessarily be accurate indicators of whether or not such results
will be achieved. A number of factors could cause actual results to
differ materially from the results discussed in the forward-looking
statements or information, including, but not limited to: the
failure to obtain the final acceptance of the Convertible Note
Offering from the TSX Venture Exchange, material adverse changes,
unexpected changes in laws, rules or regulations, or their
enforcement by applicable authorities; the failure of parties to
contracts with the company to perform as agreed; social or labour
unrest; changes in commodity prices; and the failure of
exploration, refurbishment, development or mining programs or
studies to deliver anticipated results or results that would
justify and support continued exploration, studies, development or
operations.
Inside InformationThis
announcement contains inside information for the purposes of
Article 7 of the UK version of Regulation (EU) No.
596/2014 on Market Abuse ("UK MAR"), as it forms part
of UK domestic law by virtue of the European
Union (Withdrawal) Act 2018, and Regulation (EU) No. 596/2014
on Market Abuse ("EU MAR").
- Amaroq - Debt Financing Closing Press Release - September 1-23
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