Jul. 19, 2011 (Canada NewsWire Group) --
/THE INFORMATION CONTAINED HEREIN IS RESTRICTED AND IS NOT FOR PUBLICATION, RELEASE OR DISTRIBUTION, DIRECTLY OR INDIRECTLY, IN THE UNITED STATES OR ANY OTHER JURISDICTION IN WHICH SUCH PUBLICATION, RELEASE OR DISTRIBUTION WOULD BE UNLAWFUL./
Neither this Announcement nor any part of it constitutes an offer to sell or issue or the solicitation of an offer to buy, subscribe or acquire any new Common Shares in any jurisdiction in which any such offer or solicitation would be unlawful.
TSX-V: AFF
AIM: AFF
LONDON, UK, July 19, 2011 /CNW/ - Afferro Mining Inc. ("Afferro" or the "Company"), the TSX-V / AIM (AFF) listed exploration and development company with iron ore projects in Cameroon and Liberia, announces that it has conditionally placed 17,261,452 new common shares of nil par value in the capital of the Company (the "Placing Shares") to institutional and other investors at 90 pence per Placing Share (the "Placing Price") to raise gross proceeds of £15.5 million (approximately US$24.9 million) (the "Placing").
Evolution Securities Limited ("Evolution") and RBC Capital Markets ("RBC") are acting as joint bookrunners (the "Joint Bookrunners") and GMP Securities Europe LLP ("GMP") is acting as Co-Lead Manager in relation to the Placing (each a "Bank", or together the "Banks").
The Placing
The Placing has been made on a non-pre-emptive basis and is subject to the terms and conditions set out in the Appendix which forms a part of this Announcement. The Placing has not been underwritten.
The Placing Price is equivalent to a 9.09 per cent. discount to the closing mid-market price on the AIM market of the London Stock Exchange ("AIM") on 18 July 2011. The Placing Shares represent an increase of approximately 19.99 per cent. of the current issued common share capital of the Company and the Placing Shares represent approximately 16.65 per cent. of the enlarged issued common share capital of the Company.
The Placing Shares will be credited as fully paid and will rank pari passu in all respects with the existing Common Shares, including the right to receive all dividends and other distributions declared, made or paid after the date of issue. The Placing is conditional upon, inter alia, admission of the Placing Shares to trading on AIM becoming effective and the placing agreement entered into between the Company and the Banks not being terminated prior to Admission.
Admission to trading and listing
The Company has applied for admission of the Placing Shares to trading on AIM ("Admission"). It is expected that Admission will become effective and that dealings in the Placing Shares will commence on 22 July 2011. Application will also be made for listing on the TSX Venture Exchange ("TSX-V"). Completion of the Placing is also subject to receipt of applicable regulatory approvals, including the approval of the TSX-V.
Use of proceeds
The Company intends to use the net proceeds of the Placing, totalling approximately £14.9 million (c. US$23.9 million), together with its existing cash resources of approximately US$6.0 million, to fund the following:
- c. $15.6 million to accelerate the Company's drilling programme, complete a scoping study and commence a preliminary economic assessment study for the Nkout Project;
- c. $5.2 million to fund the Company's share of costs for the Putu Project, including a resource definition drilling programme and accelerate a pre-feasibility study;
- c. $1.3 million for target identification in Cameroon; and
- corporate costs and general working capital
The Placing has been marketed predominantly to institutional investors. As detailed above, the net proceeds of the Placing, together with the existing cash resources, will provide the Company with approximately US$29.9 million of capital resources in aggregate, which will enable the Company to finance its near term drilling programmes in addition to completing a scoping study at Nkout and substantially progressing the pre-feasibility study for Putu with its partner, Severstal Resources.
Strategy
The Company's strategy is to take both the Putu Project and Nkout Project through to production. With this in mind, the Company has also commenced discussions with a range of investors whose involvement in Afferro would be more strategic in nature and from whom it is anticipated additional finance (whether equity or debt) may be raised for future infrastructure requirements in a manner that limits shareholder dilution and therefore helps to optimise future equity value. In addition, it is expected that these industry partners, as well as having infrastructure capabilities, will have a long-term desire for offtake. A further update will be provided as and when appropriate. The Placing will strengthen the ability of the Company to pursue both its drilling programmes and these strategic discussions.
Directors' Participation
The following directors have subscribed, conditional on Admission, for
an aggregate number of 155,555 Placing Shares at the Placing Price, as
detailed below:
| Director | Number of Common Shares taken up under the Placing | Total number of Common Shares held following the Placing | Percentage of enlarged issued share capital |
| David Netherway | 33,333 | 137,928 | 0.13% |
| Guy Pas | 100,000 | 5,997,226 | 5.79% |
| David Evans | 22,222 | 277,722 | 0.27% |
In addition, certain employees of the Company and other parties have subscribed, conditional on Admission, for an aggregate number of 88,889 Placing Shares and 57,445 new Common Shares at the Placing Price.
About Afferro Mining Inc.
Afferro is an established exploration and development company listed on the TSX-V (AFF) and AIM (AFF). Afferro's portfolio includes the Nkout iron ore project (the "Nkout Project"), and surrounding iron targets in Cameroon and which is subject to a resource expansion drilling programme. Afferro also has a 38.5% interest in the Putu iron ore project in Liberia (the "Putu Project"), which is subject to a resource expansion drilling programme and is moving through pre-feasibility managed by joint venture partner Severstal Resources (the mining division of London and Moscow listed OAO Severstal). In September 2010, the Putu Project was granted a 25 year renewable Mineral Development Agreement by the Government of Liberia.
IMPORTANT NOTICE
THE INFORMATION CONTAINED HEREIN IS RESTRICTED AND IS NOT FOR PUBLICATION, RELEASE OR DISTRIBUTION, DIRECTLY OR INDIRECTLY, IN THE UNITED STATES OR ANY OTHER JURISDICTION IN WHICH SUCH PUBLICATION, RELEASE OR DISTRIBUTION WOULD BE UNLAWFUL.
This Announcement has been issued by and is the sole responsibility of the Company. No representation or warranty, express or implied, is or will be made as to, or in relation to, and no responsibility or liability is or will be accepted by the Banks or by any of their respective affiliates or agents as to or in relation to, the accuracy or completeness of this Announcement or any other written or oral information made available to or publicly available to any interested party or their advisers, apart from the responsibilities and liabilities (if any) imposed on any of the Banks by the Financial Services and Markets Act 2000, and any liability therefore is expressly disclaimed.
Evolution is acting as Joint Bookrunner in connection with the Placing. Evolution, which is authorised and regulated by the Financial Services Authority, is acting for the Company in connection with the Placing and will not be responsible to anyone other than the Company for providing the protections afforded to the clients of Evolution nor for providing advice in relation to the Placing or any other matter referred to herein.
Royal Bank of Canada Europe Limited, trading as RBC Capital Markets, is acting as Joint Bookrunner in connection with the Placing. RBC, which is authorised and regulated by the Financial Services Authority, is acting for the Company in connection with the Placing and will not be responsible to anyone other than the Company for providing the protections afforded to the clients of RBC nor for providing advice in relation to the Placing or any other matter referred to herein.
GMP is acting as Co-Lead Manager in connection with the Placing. GMP, which is authorised and regulated by the Financial Services Authority, is acting for the Company in connection with the Placing and will not be responsible to anyone other than the Company for providing the protections afforded to the clients of GMP nor for providing advice in relation to the Placing or any other matter referred to herein.
The distribution of this Announcement and the Placing of the Placing Shares in certain jurisdictions may be restricted by law. No action has been taken by the Company or the Banks that would permit an offering of such shares or possession or distribution of this Announcement or any other offering or publicity material relating to such shares in any jurisdiction where action for that purpose is required. Persons into whose possession this announcement comes are required by the Company and the Banks to inform themselves about, and to observe, such restrictions.
The information in this Announcement shall not constitute an offer to sell or the solicitation of an offer to buy, nor shall there be any sale of, the securities referred to herein in any jurisdiction in which such offer, solicitation or sale would require preparation of any prospectus or other offer documentation, or be unlawful prior to registration, exemption from registration or qualification under the securities laws of any such jurisdiction.
No public offer of securities of the Company is being made in the United Kingdom, the United States, Canada or elsewhere. The information in this Announcement does not constitute or form a part of any offer or solicitation to purchase or subscribe for securities in the United States. The securities mentioned herein have not been, and will not be, registered under the United States Securities Act of 1933 (the "Securities Act") nor the security laws of any state or other jurisdiction of the United States. The securities mentioned herein may not be offered or sold in the United States except pursuant to Regulation S under the Securities Act or another exemption from, or transaction not subject to, the registration requirements of the Securities Act. There will be no public offer of securities in the United States.
The information in this Announcement may not be forwarded or distributed to any other person and may not be reproduced in any manner whatsoever. Any forwarding, distribution, reproduction, or disclosure of this information in whole or in part is unauthorised. Failure to comply with this directive may result in a violation of the Securities Act or the applicable laws of other jurisdictions.
Forward-looking Statements
This announcement includes certain forward-looking statements. All statements, other than statements of historical fact, included herein are forward-looking statements that involve various known and unknown risks and uncertainties as well as other factors. Such forward looking statements are subject to a number of risks and uncertainties that may cause actual results or events to differ materially from current expectations, including delays in obtaining or failure to obtain required regulatory approvals. There can be no assurance that such statements will prove to be accurate and actual results and future events could differ materially from those anticipated in such statements.
Information about the risks and uncertainties of the Company's business is provided in its disclosure materials, including its Annual Information Form and the MD&A for the twelve months ended 31 December 2010, available under the Company's profile on SEDAR at www.sedar.com. Although the Company has attempted to identify important factors that could cause actual actions, events or results to differ materially from those described in forward-looking information, there may be other factors that cause actions, events or results not to be as anticipated, estimated or intended. There can be no assurance that forward looking information will prove to be accurate, as actual results and future events could differ materially from those anticipated in such information. Accordingly, readers should not place undue reliance on forward-looking information. The forward-looking information contained herein, speaks only as of the date hereof (unless stated otherwise) and, except as may be required by applicable law, Afferro disclaims any obligation to update or modify such forward-looking statements, either as a result of new information, future events or for any other reason.
The release, publication or distribution of this announcement in certain jurisdictions may be restricted by law and therefore persons in such jurisdictions into which this announcement is released, published or distributed should inform themselves about and observe such restrictions.
Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accept responsibility for the adequacy or accuracy of this release.
Appendix
TERMS AND CONDITIONS OF THE PLACING
IMPORTANT INFORMATION FOR PLACEES ONLY REGARDING THE PLACING
THIS ANNOUNCEMENT IS NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, DIRECTLY OR INDIRECTLY IN OR INTO THE UNITED STATES OR ANY OTHER JURISDICTION IN OR INTO WHICH SUCH RELEASE, PUBLICATION OR DISTRIBUTION IS UNLAWFUL.
MEMBERS OF THE PUBLIC ARE NOT ELIGIBLE TO TAKE PART IN THE PLACING. THIS APPENDIX AND THE TERMS AND CONDITIONS SET OUT HEREIN ARE FOR INFORMATION PURPOSES ONLY AND ARE DIRECTED ONLY AT: (A) PERSONS IN MEMBER STATES OF THE EUROPEAN ECONOMIC AREA WHO ARE QUALIFIED INVESTORS WITHIN THE MEANING OF ARTICLE 2(1)(E) OF THE PROSPECTUS DIRECTIVE (DIRECTIVE 2003/71/EC) ("QUALIFIED INVESTORS"); (B) IN THE UNITED KINGDOM, QUALIFIED INVESTORS WHO ARE PERSONS WHO: (I) HAVE PROFESSIONAL EXPERIENCE IN MATTERS RELATING TO INVESTMENTS FALLING WITHIN ARTICLE 19(5) OF THE UNITED KINGDOM FINANCIAL SERVICES AND MARKETS ACT, 2000 (FINANCIAL PROMOTION) ORDER 2005 (THE "ORDER"); OR (II) ARE PERSONS FALLING WITHIN ARTICLE 49(2)(A) TO (D) ("HIGH NET WORTH COMPANIES, UNINCORPORATED ASSOCIATIONS, ETC") OF THE ORDER; (C) IN CANADA, (OTHER THAN BRITISH COLUMBIA), "ACCREDITED INVESTORS" AS DEFINED IN SECTION 1.1 OF NATIONAL INSTRUMENT 45-106 PROSPECTUS AND REGISTRATION EXEMPTIONS ("NI 45-106"), AND (D) PERSONS TO WHOM IT MAY OTHERWISE BE LAWFULLY COMMUNICATED (ALL SUCH PERSONS TOGETHER BEING REFERRED TO AS "RELEVANT PERSONS"). THIS ANNOUNCEMENT (INCLUDING THE APPENDIX) AND THE TERMS AND CONDITIONS SET OUT HEREIN MUST NOT BE ACTED ON OR RELIED ON BY PERSONS WHO ARE NOT RELEVANT PERSONS. ANY INVESTMENT OR INVESTMENT ACTIVITY TO WHICH THIS ANNOUNCEMENT (INCLUDING THE APPENDIX) AND THE TERMS AND CONDITIONS SET OUT HEREIN RELATES IS AVAILABLE ONLY TO RELEVANT PERSONS AND WILL BE ENGAGED IN ONLY WITH RELEVANT PERSONS. THIS ANNOUNCEMENT (INCLUDING THE APPENDIX) DOES NOT ITSELF CONSTITUTE AN OFFER FOR SALE OR SUBSCRIPTION OF ANY SECURITIES IN THE COMPANY.
Relevant persons by whom or on whose behalf a commitment to participate in the Placing has been given, (the "Placees"), will be deemed to have read and understood this Announcement, including this Appendix, in its entirety and to be making such offer on the terms and conditions, and to be providing the representations, warranties, acknowledgements, undertakings and agreements contained in this Appendix. In particular, each such Placee represents, warrants and acknowledges that it is a Relevant Person (as defined above) and undertakes that it will acquire, hold, manage or dispose of any Placing Shares that are allocated to it for the purposes of its business. In addition, Placees located in certain jurisdictions, including but not limited to Canada, will also be required to execute placing allocation letters or subscription agreements, as the case may be, in a form provided ("Placing Allocation Letter") and to return them as so executed to Evolution, RBC or GMP, as appropriate, promptly and in any event no later than 4.30 p.m. (London) on 20 July 2011 (or such later time and date as the Banks may agree). The Joint Bookrunners, in consultation with the Company, reserve the right to cancel a Placee's allocation if it fails to return to the Banks, if required, a duly executed copy of any Placing Allocation Letter sent to it by such time.
This Announcement does not constitute an offer, and may not be used in connection with an offer, to sell or issue or the solicitation of an offer to buy or subscribe for Placing Shares in any jurisdiction in which such offer or solicitation is or may be unauthorised or unlawful. This Announcement and the information contained herein is not for publication or distribution, directly or indirectly, to persons in the United States or in any jurisdiction in which such publication or distribution is unlawful. Persons into whose possession this Announcement may come are required by the Company to inform themselves about and to observe any restrictions of transfer of this Announcement. No public offer of securities of the Company is being made in the United Kingdom, the United States, Canada or elsewhere.
In particular, the Placing Shares referred to in this Announcement have not been and will not be registered under the Securities Act or the laws of any state of the United States and may not be offered, sold, pledged or otherwise transferred within the United States except pursuant to an exemption from, or as part of a transaction not subject to, the registration requirements of the Securities Act and applicable state laws.
The Placing Shares have not been and will not be qualified for distribution to the public under applicable Canadian securities laws and, accordingly, any offer and distribution of the Placing Shares in Canada (excluding the province of British Columbia) will be made on a basis that is exempt from the prospectus requirements of Canadian securities laws. The Placing Shares are not qualified for sale in British Columbia and may not be offered or sold in such province, directly or indirectly on behalf of the Company.
Persons (including, without limitation, nominees and trustees) who have a contractual or other legal obligation to forward a copy of this Appendix or the Announcement of which it forms part should seek appropriate advice before taking any action.
Notice to UK Residents
This Announcement is not a prospectus for the purposes of the Prospectus Rules published by the UK Financial Services Authority ("FSA") and has not been approved by, or filed with, the FSA. This Announcement contains no offer to the public within the meaning of Section 102B of the United Kingdom Financial Services and Markets Act 2000, the United Kingdom Companies Act 2006 or otherwise.
NOTICE TO US RESIDENTS
THIS ANNOUNCEMENT MAY NOT BE DISTRIBUTED, TAKEN OR TRANSMITTED IN OR INTO THE UNITED STATES, ITS TERRITORIES OR POSSESSIONS AND ANY FORWARDING, DISTRIBUTION OR REPRODUCTION OF THIS ANNOUNCEMENT IN WHOLE OR IN PART IS UNAUTHORISED. FAILURE TO COMPLY WITH THIS NOTICE MAY RESULT IN A VIOLATION OF THE SECURITIES ACT OR THE APPLICABLE LAWS OF OTHER JURISDICTIONS.
THE PLACING SHARES HAVE NOT BEEN AND WILL NOT BE REGISTERED UNDER THE SECURITIES ACT OR WITH ANY SECURITIES REGULATORY AUTHORITY OF ANY STATE OR OTHER JURISDICTION OF THE UNITED STATES AND MAY NOT BE OFFERED OR SOLD IN THE UNITED STATES UNLESS SUCH PLACING SHARES ARE REGISTERED UNDER THE SECURITIES ACT OR ARE OFFERED AND SOLD PURSUANT TO AN EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND IN COMPLIANCE WITH STATE SECURITIES LAWS. THE PLACING SHARES ARE BEING OFFERED AND SOLD OUTSIDE THE UNITED STATES PURSUANT TO REGULATIONS.
THE PLACING SHARES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE US SECURITIES AND EXCHANGE COMMISSION, ANY STATE SECURITIES COMMISSION OR OTHER REGULATORY AUTHORITY IN THE UNITED STATES, NOR HAVE ANY OF THE FOREGOING AUTHORITIES PASSED UPON OR ENDORSED THE MERITS OF THE PLACING OR THE ACCURACY OR ADEQUACY OF THIS ANNOUNCEMENT. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENCE IN THE UNITED STATES.
Notice to Canadian Residents
This press release is not, and under no circumstances is to be construed as, an advertisement or a public offering of the Placing Shares in Canada.
No Placing Shares may be acquired by residents in British Columbia or by any purchaser for subsequent resale to a resident of British Columbia for four months and a day from the date of the closing of the Placing.
The distribution of the Placing Shares in Canada (excluding British Columbia) is being made on a private placement basis only and is exempt from the requirement that the Company prepare and file a prospectus with the relevant Canadian securities regulatory authorities. Accordingly, any resale of the Placing Shares must be made in accordance with applicable Canadian securities laws, which may require resales to be made in accordance with prospectus and dealer registration requirements or exemptions from the prospectus and dealer registration requirements. These resale restrictions may in some circumstances apply to resales of the Placing Shares outside of Canada. Canadian purchasers are advised to seek legal advice prior to any resale of the Placing Shares.
Canadian investors are further advised that the Company does not intend to file a prospectus or similar document with any securities regulatory authority in Canada qualifying the resale of the Placing Shares to the public in any province or territory of Canada in connection with the Placing.
Details of the Placing Agreement and the Placing Shares
The Banks have today entered into the Placing Agreement with the Company under which, subject to the conditions set out in that agreement, Evolution, RBC and GMP have undertaken to use their respective reasonable endeavours to procure subscribers for the Placing Shares at the Placing Price, as described in this announcement and set out in the Placing Agreement. The Placing has not been underwritten.
The Placing Shares will, when issued, be credited as fully paid and will rank pari passu in all respects with the existing issued Common Shares including the right to receive all dividends and other distributions declared made or paid after the date of issue.
Application for admission to trading
Application has been made to the London Stock Exchange for admission to trading of the Placing Shares to AIM. It is expected that AIM Admission will become effective and that dealings on AIM in the Placing Shares will commence at 8.00 a.m. (London time) on 22 July 2011.
The Placing is subject to, inter alia, the receipt of applicable regulatory approvals, including the approval of the TSX Venture Exchange (the "TSX-V").
Participation in, and principal terms of, the Placing
Evolution and RBC are acting as Joint Bookrunners and as agents of the Company, GMP is acting as co-lead manager and as agent to the Company. The Joint Bookrunners will determine in their absolute discretion, but in consultation with the Company, the extent of each Placee's participation in the Placing, which will not necessarily be the same for each Placee and will be confirmed orally by one of the Banks as agent of the Company. That oral confirmation will constitute an irrevocable legally binding commitment upon that person (who will at that point become a Placee) to subscribe for the number of Placing Shares allocated to it at the Placing Price on the terms and conditions set out in this Appendix and in accordance with the Company's constitutional documents. No commissions will be paid to or by Placees in respect of their agreement to acquire any Placing Shares.
Each Placee's allocation and commitment will be confirmed by a contract note issued to such Placee by one of the Banks. The terms of this Announcement (including the Appendix) will be deemed incorporated in that contract note.
Each Placee will be required to pay to the Banks, on the Company's behalf, the Placing Price for each Placing Share agreed to be acquired by it under the Placing in accordance with the terms set out in this Announcement (including the Appendix). Irrespective of the time at which a Placee's allocation pursuant to the Placing is confirmed, settlement for all Placing Shares to be acquired pursuant to the Placing will be required to be made at the relevant time, on the basis explained below under "Registration and Settlement".
Obligations under the Placing will be subject to fulfilment of the conditions referred to below under "Conditions of the Placing" and to the Placing not being terminated on the basis referred to below under "Right to terminate under the Placing Agreement".
To the fullest extent permitted by law and applicable Financial Services Authority ("FSA") rules (the "FSA Rules"), none of (i) Evolution, RBC or GMP, (ii) any of their respective directors, officers, employees or consultants, or (iii) to the extent not contained with (i) or (ii), any person connected with the Banks as defined in the FSA Rules ((i), (ii) and (iii) being together "affiliates" and individually an "affiliate"), shall have any liability to Placees or to any person other than the Company in respect of the Placing.
Conditions of the Placing
The obligations of the Banks under the Placing Agreement are conditional
on, inter alia:
| (a) | AIM Admission occurring not later than 8.00 a.m. (London time) on 22 July 2011 or such other date as may be agreed between the Company and the Banks, not being later than 5 August 2011; |
| (b) | the TSX-V having conditionally approved the listing of the Placing Shares subject to customary post-closing conditions; |
| (c) | the warranties contained in the Placing Agreement being true and accurate in all material respects and not misleading in any material respect on and as of the date of the Placing Agreement and at AIM Admission; and |
| (d) | the Company having complied in all material respects with its obligations under the Placing Agreement, to the extent the same fall to be performed prior to AIM Admission. |
If: (i) any of the conditions contained in the Placing Agreement in relation to the Placing Shares are not fulfilled or waived by the Banks by the respective time or date where specified (or such later time or date as the Company and the Banks may agree); (ii) any of such conditions becomes incapable of being fulfilled; or (iii) the Placing Agreement is terminated in the circumstances specified below, the Placing in relation to the Placing Shares will lapse and the Placee's rights and obligations hereunder in relation to the Placing Shares shall cease and terminate at such time and each Placee agrees that no claim can be made by the Placee against either the Company or the Banks in respect thereof.
The Banks may, in their absolute discretion and upon such terms as it thinks fit, waive compliance by the Company with the whole or any part of any of the Company's obligations in relation to the conditions in the Placing Agreement save that certain conditions, including the condition relating to AIM Admission taking place, may not be waived. Any such extension or waiver will not affect Placees' commitments as set out in this Announcement.
None of Evolution, RBC, GMP or the Company shall have any liability to any Placee (or to any other person whether acting on behalf of a Placee or otherwise) in respect of any decision they may make as to whether or not to waive or to extend the time and/or date for the satisfaction of any condition to the Placing nor for any decision they may make as to the satisfaction of any condition or in respect of the Placing generally and by participating in the Placing each Placee agrees that any such decision is within the absolute discretion of the Banks and the Company.
Right to terminate under the Placing Agreement
The Banks may, in their absolute discretion, at any time before AIM Admission, terminate the Placing Agreement by giving notice to the Company in certain circumstances, including a breach of the warranties given to them in the Placing Agreement, the failure of the Company to comply in any material respect with its obligations, the occurrence of a material adverse change in the financial position of the Company or any member of its group or the occurrence of any international crisis, act of terrorism, outbreak of hostilities, change in national or international, financial, monetary, economic, political or market conditions which in the opinion of the Banks, is or will be materially prejudicial to the successful outcome of the Placing.
By participating in the Placing, the Placees agree that the exercise by the Banks of any right of termination or other discretion under the Placing Agreement shall be within the absolute discretion of the Banks and the Company and that they need not make any reference to Placees and that they shall have no liability to Placees whatsoever in connection with any such exercise.
No Prospectus
The Placing Shares are being offered to a limited number of specifically invited persons only and will not be offered in such a way as to require a prospectus in the United Kingdom, Canada, the United States or in any other jurisdiction. No offering document or prospectus has been or will be submitted to be approved by the FSA or any security commission in Canada in relation to the Placing and Placees' commitments will be made solely on the basis of the information contained in this Announcement (including this Appendix) and Placees' own assessment of the Company's public record available on SEDAR (www.sedar.com). Each Placee, by accepting a participation in the Placing, agrees that the content of this Announcement is exclusively the responsibility of the Company and confirms that it has neither received nor relied on any other information, representation, warranty, or statement made by or on behalf of the Company or the Banks or any other person and none of the Banks or the Company or any other person will be liable for any Placee's decision to participate in the Placing based on any other information, representation, warranty or statement which the Placees may have obtained or received and, if given or made, such information, representation, warranty or statement must not be relied upon as having been authorised by the Company, its officers or board of directors. Each Placee acknowledges and agrees that it has relied on its own investigation of the business, financial or other position of the Company in accepting a participation in the Placing, including the merits and risks involved. The Company is not making any undertaking or warranty to any Placee regarding the legality of an investment in the Placing Shares by such Placee under any legal, investment or similar laws or regulations. Each Placee should not consider any information in this Announcement to be legal, tax or business advice. Each Placee should consult its own attorney, tax advisor and business advisor for legal, tax and business advice regarding an investment in the Placing Shares. Nothing in this paragraph shall exclude the liability of any person for fraudulent misrepresentation.
Prospective Placees are referred to the Company's annual information form, which is filed and available on SEDAR at www.sedar.com for information on risk factors applicable to the Company and its operations.
Registration and Settlement
UK Settlement
Settlement of transactions in the Placing Shares following AIM Admission will take place in respect of the Placing Shares to be held on the UK depositary interest register, on a delivery versus payment basis in Depositary Interest form within CREST.
The Company will deliver the Placing Shares in Depositary Interest form to CREST accounts operated by the respective Bank as agents for the Company and the Banks will enter their respective delivery (DEL) instructions into the CREST system. The input to CREST by a Placee of a matching or acceptance instruction will then allow delivery of the relevant Placing Shares to that Placee against payment.
It is expected that settlement will take place on 22 July 2011 in CREST on a T+3 basis in accordance with the instructions set out in the conditional contract note. Settlement will be through either Evolution against CREST ID 50X23, through RBC against CREST ID 388, or through GMP against CREST ID 116.
Canadian Settlement
The Company will deliver, or have delivered, legended share certificate(s) representing the Placing Shares subscribed for by qualifying Canadian Placees as per the delivery instructions in such Placee's Placing Allocation Letter.
It is expected that such share certificates will be sent at the relevant Placee's risk on the date of Admission upon receipt of the subscription funds therefore being an amount equal to the product of the Placing Price and the number of Placing Shares such Placee has agreed to acquire.
General
The Company reserves the right to require settlement for and delivery of the Placing Shares (or a portion thereof) to any Placee in any form it requires if, in the Banks' or the Company's opinion, delivery or settlement is not possible or practicable within CREST or would not be consistent with the regulatory requirements in the Placee's jurisdiction.
Each Placee agrees that it will do all things necessary to ensure that delivery and payment is completed in accordance with the applicable registration and settlement procedures, including, if applicable, CREST rules and regulations and settlement instructions that it has in place with the respective Bank or if the Placee is in Canada in accordance with the delivery instructions in the Placing Allocation Letter sent to it.
Interest is chargeable daily on payments not received from Placees on the due date in accordance with the arrangements set out above at the rate of two percentage points above LIBOR as determined by the Banks.
Each Placee is deemed to agree that, if it does not comply with these obligations, the Banks may sell any or all of the Placing Shares allocated to that Placee on such Placee's behalf and retain from the proceeds, for the Banks' account and benefit, an amount equal to the aggregate amount owed by the Placee plus any interest due thereof. The relevant Placee will, however, remain liable for any shortfall below the aggregate amount owed by it and may be required to bear any stamp duty or stamp duty reserve tax or securities transfer tax (together with any interest or penalties) which may arise upon the sale of such Placing Shares on such Placee's behalf.
If Placing Shares are to be delivered to a custodian or settlement agent, Placees should ensure that the conditional contract note or Placing Allocation Letter, as the case may be, is copied and delivered immediately to the relevant person within that organisation. Insofar as Placing Shares are registered in a Placee's name or that of its nominee or in the name of any person for whom a Placee is contracting as agent or that of a nominee for such person, such Placing Shares should, subject as provided below, be so registered free from any liability to any UK stamp duty or stamp duty reserve tax or securities transfer tax.
Representations and Warranties
By participating in the Placing each Placee (and any person acting on
such Placee's behalf) makes the following representations, warranties,
acknowledgements, undertakings and agreements (as the case may be) to
the Company and to the Banks:
| 1 | acknowledges that without prior written approval of the TSX-V and compliance with all applicable Canadian securities legislation, the Placing Shares may not be sold, transferred, hypothecated or otherwise traded on or through the facilities of the TSX-V or otherwise in Canada or to or for the benefit of a Canadian resident until 23 November 2011; |
| 2 | represents and warrants that it has read and understood this Announcement, including the Appendix, in its entirety; |
| 3 | acknowledges that no offering document or prospectus has been or will be prepared in connection with the placing of the Placing Shares and represents and warrants that it has not received a prospectus or other offering document in connection therewith; |
| 4 | acknowledges that none of the Banks or the Company or any of their affiliates or agents or any person acting on behalf of any of them has provided, and will not provide it, with any information or material regarding the Placing Shares or the Company other than this Announcement; nor has it requested the Banks, the Company, any of their affiliates or agents or any person acting on behalf of any of them to provide it with any such information or material; |
| 5 | acknowledges that the content of this Announcement is exclusively the responsibility of the Company and that, to the fullest extent permitted by law, none of the Banks or any person acting on their behalf has or shall have any liability for any information, representation or statement contained in this Announcement or any information previously published by or on behalf of the Company and will not be liable for any Placee's decision to participate in the Placing based on any information, representation or statement contained in this Announcement or otherwise. Each Placee further represents, warrants and agrees that the only information on which it is entitled to rely and on which such Placee has relied in committing itself to acquire the Placing Shares is contained in this Announcement and any information previously published by the Company by notification to a Regulatory Information Service, such information being all that it deems necessary to make an investment decision in respect of the Placing Shares and that it has neither received nor relied on any other information given or representations, warranties or statements made by the Banks or the Company and none of the Banks or the Company will be liable for any Placee's decision to accept an invitation to participate in the Placing based on any other information, representation, warranty or statement. Each Placee further acknowledges and agrees that it has relied on its own investigation of the business, financial or other position of the Company in deciding to participate in the Placing; |
| 6 | acknowledges that the Common Shares are listed, admitted to trading or quoted (as the case may be) on AIM and the TSX-V and the Company is therefore required to publish certain business and financial information in accordance with the rules of such exchanges (collectively, the "Exchange Information"), which includes a description of the nature of the Company's business and the Company's most recent resource statements, financial statements, and similar statements for preceding financial years, and that it is able to obtain or access the Exchange Information without undue difficulty; |
| 7 | acknowledges that none of the Banks or any person acting on their behalf nor any of their affiliates or agents has or shall have any liability for the Exchange Information, any publicly available or filed information or any representation relating to the Company, provided that nothing in this paragraph excludes the liability of any person for fraudulent misrepresentation made by that person; |
| 8 | if in Canada, represents, warrants, agrees and acknowledges that (a) it is an "accredited investor" as defined in Section 1.1 of NI 45-106; and (b) it is also purchasing the Placing Shares pursuant to the terms and conditions set forth in the Placing Allocation Letter delivered to such investor; and (c) that in the event of an inconsistency or conflict between the provisions of the Placing Allocation Letter and this Announcement, the provisions of the Placing Allocation Letter shall govern; |
| 9 | represents and warrants that its subscription is made from outside the United States, the Canadian province of British Columbia or any other jurisdiction in or into which the release, publication or distribution of this Announcement is unlawful; |
| 10 | acknowledges that the Placing Shares are not qualified for sale in British Columbia and may not be offered, sold, taken up, renounced or delivered or transferred, directly or indirectly, within British Columbia; |
| 11 | acknowledges that, (a) no securities commission or similar regulatory authority has reviewed or passed on the merits of the Placing Shares, (b) there is no government or other insurance covering the Placing Shares, (c) there are risks associated with the purchase of the Placing Shares, (d) there may be restrictions on the Placee's ability to resell the Placing Shares and it is the responsibility of the Placee to find out what those restrictions are and to comply with them before selling the Placing Shares, and (e) the Company has advised the Placee that the Company is relying on an exemption from the requirements to provide the Placee with a prospectus and to sell Placing Shares through a person registered to sell securities under the British Columbia Securities Act, R.S.B.C. 1996, c. 418 (the "BCSA") and, as a consequence of acquiring securities pursuant to this exemption, certain protections, rights and remedies provided by the BCSA, including statutory rights of rescission or damages, will not be available to the Placee; |
| 12 | represents and warrants that the issue to it, or the person specified by it for registration as holder, of Placing Shares will not give rise to a liability under any of sections 67, 70, 93 or 96 of the Finance Act, 1986 (depositary receipts and clearance services) and that the Placing Shares are not being acquired in connection with arrangements to issue depositary receipts or to transfer Placing Shares into a clearance system; |
| 13 | represents and warrants that it has complied with its obligations in connection with money laundering and terrorist financing under the United Kingdom Proceeds of Crime Act, 2002, the United Kingdom Terrorism Act, 2003 and the United Kingdom Money Laundering Regulations, 2007 and any equivalent legislation in the jurisdiction in which it is located (the "Regulations") and, if making payment on behalf of a third party, that satisfactory evidence has been obtained and recorded by it to verify the identity of the third party as required by the Regulations; |
| 14 | if a financial intermediary, as that term is used in Article 3(2) of the Prospectus Directive, represents and warrants that the Placing Shares purchased by it in the Placing will not be acquired on a non-discretionary basis on behalf of, nor will they be acquired with a view to their offer or resale to, persons in a member state of the European Economic Area which has implemented the Prospectus Directive other than Qualified Investors, or in circumstances in which the prior consent of the Banks have been given to the offer or resale; |
| 15 | represents and warrants that it has not offered or sold and, prior to the expiry of a period of six months from AIM Admission, will not offer or sell any Placing Shares to persons in the United Kingdom, except to persons whose ordinary activities involve them in acquiring, holding, managing or disposing of investments (as principal or agent) for the purposes of their business or otherwise in circumstances which have not resulted and which will not result in an offer to the public in the United Kingdom within the meaning of section 85(1) of the FSMA; |
| 16 | represents and warrants that it has not offered or sold and will not offer or sell any Placing Shares to persons in the European Economic Area prior to AIM Admission except to persons whose ordinary activities involve them in acquiring, holding, managing or disposing of investments (as principal or agent) for the purposes of their business or otherwise in circumstances which have not resulted in and which will not result in an offer to the public in any member state of the European Economic Area within the meaning of the Prospectus Directive; |
| 17 | represents and warrants that it has only communicated or caused to be communicated and will only communicate or cause to be communicated any invitation or inducement to engage in investment activity (within the meaning of section 21 of the FSMA) relating to the Placing Shares in circumstances in which section 21(1) of the FSMA does not require approval of the communication by an authorised person; |
| 18 | represents and warrants that it has complied and will comply with all applicable provisions of the FSMA with respect to anything done by it in relation to the Placing Shares in, from or otherwise involving the United Kingdom; |
| 19 | represents and warrants that if it resides in a member state of the European Economic Area it is a Qualified Investor within the meaning of the Prospectus Directive; |
| 20 | represents and warrants that if it resides in the United Kingdom it is a Qualified Investor within the meaning of the Prospectus Directive and a person (a) who has professional experience in matters relating to investments and fall within article 19(5) (investment professionals) of the Order, or (b) who falls within article 49(2)(a) to (d) (high net worth companies, unincorporated associations etc) of the Order; |
| 21 | represents and warrants that it and any person acting on its behalf is entitled to acquire the Placing Shares under the laws of all relevant jurisdictions and that it has all necessary capacity and has obtained all necessary consents and authorities to enable it to commit to this participation in the Placing and to perform its obligations in relation thereto (including, without limitation, in the case of any person on whose behalf it is acting, all necessary consents and authorities to agree to the terms set out or referred to in this Announcement) and will honour such obligations, and it has had access to such financial and other information concerning the Company and the Placing shares as it deems necessary in connection with its decision to purchase the Placing Shares; |
| 22 | where it is acquiring Placing Shares for one or more managed accounts, represents and warrants that it is authorised in writing by each managed account: (a) to acquire the Placing Shares for each managed account; (b) to make on its behalf the representations, warranties, acknowledgements, undertakings and agreements in this Appendix and the Announcement of which it forms part; and (c) to receive on its behalf any investment letter or Placing Allocation Letter relating to the Placing in the form provided to you by the Banks; |
| 23 | undertakes that it (and any person acting on its behalf) will make payment for the Placing Shares allocated to it in accordance with this Announcement and Placing Allocation Letter on the due time and date set out herein and it has obtained all necessary consents and authorities to enable it to give its commitment so to subscribe, failing which the relevant Placing Shares may be placed with other placees or sold as the Banks may in their sole discretion determine and without liability to such Placee; |
| 24 | acknowledges that none of the Banks, or any of their affiliates, or their respective agents or any person acting on behalf of any of them, are making any recommendations to it or advising it regarding the suitability of any transactions it may enter into in connection with the Placees and that participation in the Placing is on the basis that it is not and will not be a client of the Banks and that the Banks have no duties or responsibilities to it for providing the protections afforded to their clients or customers or for providing advice in relation to the Placing nor in respect of any representations, warranties, acknowledgements, undertakings or indemnities contained in the Placing Agreement nor for the exercise or performance of any of their rights and obligations thereunder including any rights to waive or vary any conditions or exercise any termination right; |
| 25 | undertakes that the person whom it specifies for registration as holder of the Placing Shares will be: (a) itself; or (b) its nominee, as the case may be. None of the Banks or the Company will be responsible for any liability to stamp duty or stamp duty reserve tax or securities transfer tax resulting from a failure to observe this requirement. Each Placee and any person acting on behalf of such Placee agrees to participate in the Placing and it agrees to indemnify the Company and the Banks in respect of the same on the basis that the Placing Shares will be allotted to the relevant CREST stock account of the respective Bank or their affiliates or agents who will hold them as nominee on behalf of such Placee until settlement in accordance with its standing settlement instructions; |
| 26 | acknowledges that any agreements entered into by it pursuant to these terms and conditions (including any non-contractual obligation arising out of such agreements) shall be governed by and construed in accordance with the laws of England and Wales and it submits (on behalf of itself and on behalf of any person on whose behalf it is acting) to the exclusive jurisdiction of the English courts as regards any claim, dispute or matter arising out of any such contract, except that enforcement proceedings in respect of the obligation to make payment for the Placing Shares (together with any interest chargeable thereon) may be taken by the Company or the Banks in any jurisdiction in which the relevant Placee is incorporated or in which any of its securities have a quotation on a recognised stock exchange; |
| 27 | acknowledges that time shall be of the essence as regards to obligations pursuant to this Appendix to the Announcement; |
| 28 | agrees that the Company and the Banks and their respective affiliates and agents and others will rely upon the truth and accuracy of the foregoing representations, warranties, acknowledgements, undertakings and agreements which are given to the Banks on their own behalf and on behalf of the Company and are irrevocable, and with respect to any of the representations, warranties, acknowledgements, undertakings and agreements deemed to have been made by a purchaser of the Placing Shares as a fiduciary or agent for one or more investor accounts, it has sole investment discretion with respect to each such account and it has full power and authority to make the foregoing representations, warranties, acknowledgements, undertakings and agreements on behalf of each such account; |
| 29 | agrees to indemnify and hold the Company and the Banks and their respective affiliates and agents harmless from any and all costs, claims, liabilities and expenses (including legal fees and expenses) arising out of or in connection with any breach of the representations, warranties, acknowledgements, agreements and undertakings in this Appendix and further agrees that the provisions of this Appendix shall survive after completion of the Placing; |
| 30 | represents and warrants that it is an institution which: (a) has such knowledge and experience in financial and business matters and expertise in assessing credit, market and all other relevant risks as to be capable of evaluating, and has evaluated independently, the merits, risks and suitability of its investment in the Placing Shares; and (b) it and any accounts for which it is acting are each able to bear the economic risk of such investment, and are each able to sustain a complete loss of any investment in the Placing Shares; |
| 31 | represents and warrants that it is entitled to subscribe for the Placing Shares under the laws of all relevant jurisdictions which apply to it; its subscription is being made from outside the United States; has not purchased the Placing Shares as a result of any directed selling efforts within the meaning of Rule 902(c) of Regulation S; and its purchase of the Placing Shares will be in compliance with the requirements of Regulation S, including, without limitation, that the offer and sale of the Placing Shares to it will be made in an "offshore transaction" as such term is defined in Regulation S; |
| 32 | understands and acknowledges that the Placing Shares are being offered in a transaction not involving any public offering in the United States within the meaning of the Securities Act and that the Placing Shares have not been and will not be registered under the Securities Act or the securities laws of any State in the United States. It agrees that the Placing Shares may not be reoffered, sold, pledged or otherwise transferred, and that it will not directly or indirectly reoffer, sell, pledge or otherwise transfer the Placing Shares, except in an offshore transaction in accordance with Rule 903 or 904 of Regulation S or another exemption from, or transaction not subject to, the Securities Act and that such offer, sale, pledge or transfer must, and will, be made in accordance with any applicable securities laws of any State or other jurisdiction of the United States; and |
| 33 | understands that no representation has been, is being or will be made by the Company as to the availability of an exemption from the registration for the reoffer, resale, pledge or transfer of the Placing Shares in accordance the Securities Act. |
Placees should note that they will be liable for any stamp duty and all other stamp, issue, securities, transfer, registration, documentary or other duties or taxes (including any interest, fines or penalties relating thereto) payable outside the UK by them or any other person on the subscription by them of any Placing Shares or the agreement by them to subscribe for any Placing Shares.
Each Placee, and any person acting on behalf of the Placee, acknowledges that none of the Banks owe any fiduciary or other duties to any Placee in respect of any representations, warranties, undertakings, acknowledgements, agreements or indemnities in the Placing Agreement.
Each Placee and any person acting on behalf of the Placee acknowledges and agrees that the Banks or any of their affiliates or agents may, at their absolute discretion, agree to become a Placee in respect of some or all of the Placing Shares.
When a Placee or person acting on behalf of the Placee is dealing with a Bank, any money held in an account with a Bank, on behalf of the Placee and/or any person acting on behalf of the Placee will not be treated as client money within the meaning of the rules and regulations of the FSA made under the FSMA. The Placee acknowledges that the money will not be subject to the protections conferred by the client money rules; as a consequence, this money will not be segregated from the respective Banks' money, as the case may be, in accordance with the client money rules and will be used by the Bank in the course of its own businesses and the Placee will rank only as a general creditor of the Bank.
If the Company or the Banks or their affiliates or agents request any information about a Placee's agreement to acquire Placing Shares or the Placee, including, without limitation, any information, confirmation, report or filing, required by the TSX-V in respect of the Placing Shares or any Placee and any evidence supporting the representations and warranties given above, such Placee shall (and it undertakes to) promptly disclose or provide it to them promptly and in any event prior to 4.30 p.m. (London time) on 20 July 2011 (or such later date as they may agree) and failing which the Joint Bookrunners reserve the right to cancel any relevant allocation of Placing Shares.
All times and dates in this Announcement may be subject to amendment.
DEFINITIONS
In addition to those terms otherwise defined in this document, the
following expressions have the following meaning unless the context
otherwise requires:
| AIM Admission | the admission by the London Stock Exchange of the Placing Shares to trading on AIM becoming effective in accordance with the AIM Rules |
| AIM | the AIM Market operated by the London Stock Exchange |
| AIM Rules | the current rules published by the London Stock Exchange applicable to companies with a class of securities admitted to trading on AIM |
| Announcement | this announcement (including the appendix to this announcement) |
| Bank or Banks | any or all of Evolution, RBC and/or GMP, as appropriate |
| certificated or in certificated form | where a share or other security is not in uncertificated form |
| Co-Lead Manager | GMP |
| Common Shares | common shares in the share capital of the Company |
| CREST | the relevant system, as defined in the CREST Regulations (in respect of which Euroclear UK & Ireland Limited is the operator as defined in the CREST Regulations) |
| Depositary Interests or DIs | independent securities constituted under English law and issued or to be issued by the Depositary in respect, and representing on a 1 for 1 basis, underlying Common Shares which may be held or transferred through the CREST system |
| European Economic Area | the European Union, Iceland, Norway and Liechtenstein |
| Evolution | Evolution Securities Limited |
| FSA | the UK Financial Services Authority |
| FSMA | the Financial Services and Markets Act 2000 |
| GMP | GMP Securities Europe LLP |
| Joint Bookrunners | Evolution and RBC |
| LIBOR | London Interbank Offered Rate |
| London Stock Exchange or LSE | London Stock Exchange plc |
| NI 31-103 | National Instrument 31-103 - Registration Requirements and Exemptions |
| NI 45-106 | National Instrument 45-106 - Prospectus and Registration Exemptions |
| Placee | any person (including individuals, funds or otherwise) by whom or on whose behalf a commitment to acquire Placing Shares has been given |
| Placing | the placing of the Placing Shares with Placees to be effected by the Banks on the terms and subject to the conditions set out in this Announcement and the Placing Agreement |
| Placing Agreement | the placing agreement dated 19 July 2011 among the Company and the Banks in respect of the Placing |
| Placing Price | 90 pence per Placing Share |
| Placing Shares | the 17,261,452 new Common Shares to be issued pursuant to the Placing |
| Pounds Sterling, £ or GBP | the lawful currency of the United Kingdom |
| Prospectus Directive | the Directive of the European Parliament and of the Council of the European Union 2003/71/EC |
| RBC | Royal Bank of Canada Europe Limited, trading as RBC Capital Markets |
| Regulatory Information Service | one of the regulatory information services approved by the London Stock Exchange for the distribution to the public of AIM announcements |
| Regulation S | Regulation S under the Securities Act |
| Securities Act | the US Securities Act of 1933, as amended |
| United Kingdom or UK | the United Kingdom of Great Britain and Northern Ireland |
| United States or US | the United States of America, its territories and possessions, any state of the United States and the District of Columbia |
| US Dollar or US$ | The lawful currency of the United States |
Afferro Mining Inc.
Luis da Silva, President & CEO
Tel: +44 (0) 20 7257 2930
Evolution Securities Limited
Nominated Adviser: Jeremy Ellis / Neil Elliot
Corporate Broker: Tim Redfern / Jonathan Wynn
Tel: +44 (0) 20 7071 4300
RBC Capital Markets
Joint Broker: Martin Eales / Richard Hughes /Jonathan Hardy
Tel: +44 (0) 20 7653 4000
GMP Securities Europe LLP
Alexandra Carse/ Richard Greenfield
Tel: +44 (0) 207 647 2800
Pelham Bell Pottinger
Charles Vivian / James MacFarlane
Tel: +44 (0) 20 7861 3232