News Releases - Friday, February 26, 1999
DIAMONDWORKS CEASE TRADE ORDER TO LAPSE; CDN$9.26 MILLION PRIVATE
PLACEMENT FINANCING
===========================================================================
VANCOUVER, CANADA - DiamondWorks today announced that the temporary cease
trade order on the company's shares issued by the Ontario Securities
Commission on January 29, 1999, will lapse effective today. DiamondWorks
expects that the company's shares will resume trading on the Toronto Stock
Exchange on Monday, March 1st.
The company wishes to provide an update on material events that have occurred
since January 29, 1999.
DiamondWorks filed a notice of private placement with the Toronto Stock
Exchange which, following regulatory comments, was finalized for the
placement of up to 54,471,764 units at a price of CDN $0.17 per unit for
total proceeds of CDN$9.26 million. The funds will be used to advance the
development of the company's diamond properties. Each unit consists of one
common share and one common share purchase warrant. Each share purchase
warrant will entitle the holder to acquire one common share of the company at
an exercise price of CDN$0.17 for a period of one year after closing.
Two of DiamondWorks' existing institutional shareholders have agreed to
purchase an aggregate of up to CDN$4.56 million of the private placement. A
third investor, Ekuseni Resources Limited, a company controlled by Brian
Menell, a DiamondWorks' director, will also purchase up to CDN$4.56 million
of the private placement. A fourth investor, Invesco Trading SA, a company
controlled by Delu Holender, a DiamondWorks' director, will purchase
CDN$136,000 of the private placement.
Conditions of closing the private placement included the following which have
been obtained: Toronto Stock Exchange approval in principle, an exemption
being granted by the Ontario Securities Commission in respect to the
requirements of Ontario Securities Commission Policy 9.1 applicable to the
private placement, and the private placement being consented to in writing by
shareholders holding a majority of the outstanding common shares of the
company.
In view of the necessary approvals and exemptions having been obtained and
the company's need for funds, to date, CDN$4.56 million of the private
placement has closed and the balance is expected to close shortly. Assuming
the entire private placement closes, the two existing institutional
shareholders, in aggregate, will own 25.14% of DiamondWorks' issued shares
and will be deemed to beneficially own 36.50% of the issued shares after
giving effect to the exercise of their warrants. Ekuseni will own 17.90% of
the issued shares and will be deemed to beneficially own 30.36% of the issued
shares after giving effect to the exercise of Ekuseni's warrants.
DiamondWorks' current largest shareholders, Hansard Management Services and
Hansard Trust Company, will own, in aggregate, 17.46% of the issued shares.
The two Hansard companies have signed a voting arrangement with Ekuseni
whereby Ekuseni will have voting control over the Hansard companies shares in
the election of the majority of DiamondWorks' directors. Ekuseni is
entitled, upon completion of the private placement, to appoint a member to
the DiamondWorks board. Ekuseni has indicated that they do not intend to
make any changes to DiamondWorks' current management or the current business
of the company.
Despite intense efforts, the company has not yet secured the release of its
personnel taken hostage on November 8, 1998, from the Yetwene Mine in
north-east Angola. The company is continuing to pursue all possible avenues
to secure their safe release.
For further information, please call +1-604-669-8871, or view DiamondWorks'
website at www.diamondworks.com.
===========================================================================
Copyright (c) 1997, 1998 DIAMONDWORKS LTD. All rights reserved.
For more information, visit our website at the address
diamondworks.com
===========================================================================
|
