/FOR DISSEMINATION IN CANADA AND OVER CANADIAN NEWS SERVICES ONLY/
TORONTO, April 11 /CNW/ - Eton Park Capital Management, L.P. ("Eton Park") announces that Eton Park Master Fund, Ltd. and EP Cayman, Ltd.
(collectively, the "Eton Park Funds"), two investment funds that it manages, have completed the acquisition
of a total of 18,650,216 units ("Units") and 52,812,185 subscription receipts ("Subscription Receipts") of Largo Resources Ltd. ("Largo") pursuant to the private placement previously announced by Largo in
press releases dated March 11, 2011 and March 25, 2011 (the "Private Placement"). The Units were acquired at a price of $0.35 per Unit for aggregate
consideration of $6,527,575.60 and the Subscription Receipts were
acquired at a price of $0.35 per Subscription Receipt for aggregate
consideration of $18,484,264.75.
Each Unit consists of one common share (each a "Common Share") and one-third of one common share purchase warrant (each whole
warrant, a "Warrant"). Each whole Warrant is exercisable for one Common Share at a price of
$0.50 for a period of 48 months, expiring April 8, 2015. Each
Subscription Receipt will convert, at no additional cost, into one Unit
upon the satisfaction of certain escrow release conditions or if
exercised at the discretion of the Eton Park Funds.
As a result of this acquisition, the Eton Park Funds own an aggregate of
18,650,216 Common Shares, representing approximately 4.64% of the total
outstanding Common Shares of Largo. Assuming conversion of the
Subscription Receipts and exercise of the Warrants currently held and
the Warrants to be received on conversion of the Subscription Receipts,
the Common Shares would represent approximately 19.9% of the total
outstanding Common Shares of Largo, on a partially-diluted basis.
Contemporaneously with the closing of the Private Placement, Largo and
each of the Eton Park Funds, together with certain other lead
investors, have entered into an investor nomination rights and
governance agreement (the "Governance Agreement") pursuant to which the Eton Park Funds are entitled to nominate one
director to the Largo board of directors. In addition, the Eton Park
Funds have a pre-emptive right to subscribe for Common Shares or other
securities convertible or exchangeable into Common Shares to be issued
in connection with any equity financing (collectively, the "Offered Securities") at the same price and on the same terms as Largo intends to offer the
Offered Securities to potential investors. These nomination and
pre-emptive rights will automatically terminate after the first
continuous 45 day period during which the Eton Park Funds' ownership of
Common Shares is reduced to less than 10% of the issued and outstanding
Common Shares of Largo.
Pursuant to the Governance Agreement, certain decisions in respect of
Largo and its subsidiaries (collectively, the "Group") require the approval of six of Largo's seven directors. Such matters
include (a) certain amendments to the articles or by-laws of any member
of the Group; (b) approving or amending an annual business plan for
Largo; (c) appointing, changing or removing senior officers of Largo or
any of its affiliates as well as determining certain aspects of their
compensation; (d) approving any material transactions of any member of
the Group; (e) approving use of any proceeds of the Private Placement
for any purpose other than the development of Largo's Maracás Project;
and (f) decisions in respect of, inter alia, dividends, distributions
and issuing any security of any member of the Group (other than Largo)
other than to another member of the Group.
The Governance Agreement will automatically terminate: (a) after the
first continuous 45 day period during which the aggregate ownership of
Common Shares by the Eton Park Funds and two other lead investors,
collectively, is reduced to less than 10% of the issued and outstanding
Common Shares of Largo; or (b) if at any time one person (or group of
persons acting jointly or in concert) acquires that number of Common
Shares which would grant such person (or group of persons acting
jointly or in concert) the right to exercise votes representing not
less than 66 2/3% of the Common Shares of Largo.
Eton Park, as investment manager, maintains sole investment discretion,
including voting and dispositive power, in respect of the Common
Shares, Warrants and Subscription Receipts beneficially owned by the
Eton Park Funds. Eric M. Mindich controls Eton Park as the managing
member of its general partner, Eton Park Capital Management, L.L.C. As
such, Mr. Mindich may be deemed to share voting and dispositive power
with Eton Park with respect to the Largo securities beneficially owned
by the Eton Park Funds, but he disclaims any beneficial ownership of
any such securities.
The Largo securities were acquired for investment purposes. The Eton
Park Funds may, from time to time, acquire additional securities of
Largo and/or dispose of such securities as they may deem appropriate.
This news release has been disseminated in accordance with the early
warning requirements of Canadian provincial securities laws.
About Eton Park:
Eton Park is a global, multi-disciplinary investment organization
dedicated to delivering superior risk-adjusted returns over a
multi-year period. Eton Park currently manages approximately USD 14.0
billion and has offices in New York, London and Hong Kong.
The dissemination of this release in the United States or to any United
States news service may constitute a violation of U.S. securities laws.
SOURCE Eton Park Capital Management, L.P.
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