06:11:34 EDT Fri 29 Mar 2024
Enter Symbol
or Name
USA
CA



Coro Mining Corp
Symbol COP
Shares Issued 159,372,180
Close 2016-05-20 C$ 0.115
Market Cap C$ 18,327,801
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Coro Mining arranges $10-million private placement

2016-05-24 11:24 ET - News Release

Mr. Michael Philpot reports

CORO ANNOUNCES PRIVATE PLACEMENT AND AMENDMENT TO CONVERSION TERMS OF OUTSTANDING CONVERTIBLE DEBENTURES

Coro Mining Corp. has arranged a private-placement financing of up to 100 million common shares at a price of 10 cents per share to raise gross proceeds of up to $10-million.

The company also announces it has entered into a binding term sheet with its major shareholder, Greenstone Resources LP. The company owes $8,125,000 (U.S.) to Greenstone pursuant to the terms of certain convertible debentures issued by the company to Greenstone. In accordance with the terms of the convertible debentures, in the event the repayment amounts are not repaid on their respective repayment dates, the repayment amounts will convert into common shares of the company at a price of four cents per common share. Under the term sheet, Greenstone has agreed to increase the conversion price to 10 cents and to convert the repayment amount under the convertible debentures as soon as possible, thereby resulting in considerably less dilution to the company's shareholders. It is anticipated that Greenstone will receive 106.73 million common shares upon conversion of the convertible debentures and, following this conversion, Greenstone will own 53.9 per cent of the issued and outstanding common shares of the company.

In addition, under the terms of an investor rights agreement entered into between the company and Greenstone, Greenstone has a pre-emptive right to participate in the private placement in order to maintain its 53.9-per-cent percentage interest in the company. Under the term sheet, Greenstone has committed to exercising this pre-emptive right with regard to the private placement and, in the event the private placement is not fully subscribed for, Greenstone has agreed to acquire all of the shortfall of common shares that remain unsubscribed for. In exchange for underwriting the private placement, Greenstone will receive a fee on the portion of the private placement that exceeds its pre-emptive right and will also be reimbursed for its costs incurred.

Alan Stephens, president and chief executive officer of Coro, commented: "We greatly appreciate Greenstone converting their convertible debenture at a considerably higher price than required, which demonstrates their firm commitment to our growth strategy. We are also delighted that they have agreed to strongly support our private placement, which means that Coro will be well funded to continue the development of our exciting Marimaca project and the growth of our SCM Berta operations."

The private placement will be completed in two tranches. Tranche 1, which will close as soon as possible, will comprise the issue of 34 million common shares to Greenstone at 10 cents per common share to raise $3.4-million. Tranche 1 represents 10 per cent of the issued and outstanding common shares of the company following the conversion of the convertible debentures and as such does not require shareholder approval. Tranche 2 will be completed upon receipt of shareholder approval and will be for the issuance of the balance of the common shares to raise up to $6.6-million.

As the private placement will involve the issuance of more than 25 per cent of the outstanding common shares of the company at a price less than the current market price, shareholder approval will be required. In addition, in accordance with policies of the Toronto Stock Exchange, shareholder approval of the Greenstone participation is required. Accordingly, the company intends to adjourn its shareholder meeting, currently scheduled for June 15, 2016, until the end of June. At the rescheduled shareholder meeting, the company's shareholders will be asked to approve, amongst other matters, both the private placement and the Greenstone participation. Further information on the shareholder meeting will be provided to the company's shareholders in the coming week.

The private placement, including the Greenstone participation, remains subject to approval of the TSX. The Greenstone participation remains subject to certain additional conditions precedent, including the absence of any material adverse change in respect of Coro.

We seek Safe Harbor.

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