TORONTO--(BUSINESS WIRE)--Almonty Industries Inc. (TSX-V:AII) (“Almonty”) announces that it reached an agreement with Deutsche Rohstoff AG (“DRAG”), an existing shareholder of and lender to Almonty, to extend to March 22, 2019 the maturity date of a non-transferable secured convertible promissory note in the principal amount of CAD$6,000,000 (the “2014 Note”) in favour of DRAG. The Note was extended on the same terms as were prevailing.
In connection with the extension of the maturity date of the 2014 Note, Almonty also reached an agreement with DRAG to settle the outstanding interest under the 2014 Note in the amount of $422,103 through the issuance of Common Shares, subject to approval of the TSX Venture Exchange. Such Common Shares are to be issued at a price per Common Share of $0.35, resulting in the issuance of 1,206,574 Common Shares. This represents a premium of 32% at current share price.
Almonty and DRAG also reached agreement as to the issuance of Common Shares in satisfaction of the outstanding interest in the amount of $79,496 for the period to December 31, 2016 under the US$1.0 million promissory note issued to DRAG on January 1, 2016 (the “2016 Note”) and due on January 1, 2019, subject to approval of the TSX Venture Exchange. Such Common Shares are to be issued at a price per Common Share of $0.28, resulting in the issuance of 283,914 Common Shares.
The amendments to the 2014 Note Financing and the issuance of Common Shares in satisfaction of interest due under the 2014 Note and the 2016 Note each constitute a “related party transaction” within the meaning of Multilateral Instrument 61-101 Protection of Minority Shareholders in Special Transactions (“MI 61-101”). For these transactions, Almonty is relying 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.
Lewis Black, Chief Executive Officer of Almonty, commented, “The extension to the $6.0 million convertible note to March 22, 2019 and the settlement of interest at significantly above market by the issuance of equity is the continuation of our balance sheet clean-up program. To date we have now reduced current debt and liabilities by over $10 million and reduced our short term liabilities by $6 million. As this program continues we will update the market accordingly.”
About Almonty
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 Panasqueira mine in Portugal as well as the refurbishment of its Wolfram Camp Mine in north Queensland, Australia, the development of its Sangdong tungsten mine in Gangwon Province, South Korea and the development of the Valtreixal tin/tungsten project in north western Spain. 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 kilometres west of Cairns in northern Queensland, Australia and has produced tungsten and molybdenum concentrate, although the Wolfram Camp Mine is not currently producing due to ongoing refurbishment of the processing plant. The Panasqueira mine, which has been in production since 1896, is located approximately 260 kilometres northeast of Lisbon, Portugal, was acquired in January 2016 and produces tungsten concentrate. The Sangdong mine, which was historically one of the largest tungsten mines in the world and one of the few long-life, high-grade tungsten deposits outside of China, was acquired in September 2015 through the acquisition of a 100% interest in Woulfe Mining Corp. Almonty owns 100% of 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.
