Orla Mining (OLA-V) and Pershimco Resources (PRO-V) Oct 13,'16 are pleased to announce that, further to their joint news releases on September 14, 2016 and September 28, 2016, Orla has closed its previously announced private placement of subscription receipts pursuant to which Orla issued 28,571,428 Subscription Receipts at a price of C$1.75 per Subscription Receipt for aggregate gross proceeds of approximately C$50 million. A syndicate of agents, led by GMP Securities L.P. as sole bookrunner, and including BMO Capital Markets, TD Securities Inc. and Cormark Securities Inc. (collectively, the "Agents"), acted on behalf of Orla with respect to the Private Placement.
Following completion of the previously announced planned business combination between Orla and Pershimco (the "Transaction"), each Subscription Receipt will ultimately entitle the holder thereof to receive one common share (a "Common Share") of the combined company ("NewCo") upon completion of the Transaction.
In connection with the Private Placement, the Agents will receive a cash commission equal to approximately C$1.5 million upon satisfaction of the Release Conditions (as defined below). As additional consideration, immediately prior to the effective time on the effective date of the Transaction, Orla will issue to the Agents 865,669 broker warrants (the "Broker Warrants"). Provided that the Release Conditions are satisfied, each Broker Warrant will entitle the holder thereof to subscribe for one common share of Orla at an exercise price of C$1.75 per common share of Orla until October 13, 2018. Pursuant to the Transaction, each Broker Warrant will be exchanged for a Broker Warrant of NewCo, with each Broker Warrant of NewCo entitling the holder thereof to subscribe for one Common Share at a price per Common Share of C$1.75 until October 13, 2018.
The gross proceeds from the Private Placement have been deposited and will be held in escrow and shall be released immediately prior to the completion of the Transaction upon the satisfaction of certain conditions (the "Release Conditions") on or before January 31, 2017. If the Release Conditions are not satisfied on or before January 31, 2017, or if prior to such date Orla advises the Agents or announces to the public that it does not intend to satisfy the Release Conditions, the escrow agent will return to holders of the Subscription Receipts an amount equal to the aggregate subscription price for the Subscription Receipts held by them, together with a pro rata portion of interest earned on the escrowed proceeds, and the Subscription Receipts will be cancelled and of no further force or effect.
Assuming the satisfaction of the Release Conditions, the net proceeds of the Private Placement will be used to repay any amounts owed to RK Mine Finance, for exploration growth at Cerro Quema and for general corporate purposes.
The Subscription Receipts are subject to a four-month and a day hold period in Canada expiring February 14, 2017, however, upon closing of the Transaction, the Subscription Receipts will be exchanged for freely-tradable Common Shares. The Private Placement remains subject to the final approval of the TSX Venture Exchange.
Insiders of Orla participated in the Private Placement on the same terms as arm's length investors and subscribed for an aggregate of 12,604,000 Subscription Receipts representing 44.1% of the outstanding Subscription Receipts sold under the Private Placement. The participation of each insider is considered to be a "related party transaction" as defined under Multilateral Instrument 61-101 Protection of Minority Security Holders in Special Transactions ("MI 61-101") and accordingly, minority shareholder approval of the insider participation in the Private Placement will be obtained in connection with the Transaction. As Orla is not listed on certain specified stock exchanges, it is exempt from the requirement to obtain a formal valuation. Orla did not file a material change report more than 21 days before the closing of the Private Placement, as the details of the aforementioned insiders' participation had not been confirmed at that time.
This news release does not constitute an offer to sell or a solicitation of an offer to buy any of the securities in the United States, nor shall there be any sale of these securities in any jurisdiction in which such offer, solicitation or sale would be unlawful. 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 and may not be offered or sold within the United States or to U.S. Persons unless registered under the U.S. Securities Act and applicable state securities laws or an exemption from such registration is available.
About Orla Mining Ltd.
Orla is a closely held mineral exploration company led by a group of seasoned mining executives. The Company's focus is to acquire mineral exploration opportunities where the Company's exploration and development expertise and corporate share structure could substantially enhance shareholder value.
About Pershimco Resources
Pershimco Resources is a mineral exploration and development company with a near-term gold oxide production scenario and a copper-gold porphyry target at its 100%-owned Cerro Quema Project in Panama. Cerro Quema's sizable concession boasts paved road access, no indigenous communities and the most favorable climate for mining in the country. Pershimco is currently in the last stage of the permitting process for its proposed gold oxide heap leach operation.
Additionally, the Cerro Quema Project has proven to have significant exploration upside with resource expansion potential in over multiple oxide targets identified along a 17 km trend, gold and copper in the sulphide system below the oxide caps, as well as porphyry indicators along a 12 km strike length that highlights the potential for a nearby copper-gold porphyry system. Please refer to the Cerro Quema Project - Pre-Feasibility Study on the La Pava and Quemita Oxide Gold Deposits, available on the Company's website, and filed on SEDAR on August 22, 2014 as well as to the press release of July 8, 2014.
Orla Mining Ltd.
Marc Prefontaine
President & Chief Executive Officer
604-681-8030
info@orlamining.com
Pershimco Resources Inc.
Alain Bureau, P. Eng.
President & Chief Executive Officer
819-797-2180
ressources@pershimco.ca
Elina Chow
Investor Relations, Pershimco
416-845-8495
info@pershimco.ca |
