/NOT FOR DISTRIBUTION TO UNITED STATES NEWSWIRE SERVICES OR FOR
DISSEMINATION IN THE UNITED STATES/
VANCOUVER, June 15 /CNW/ - Aura Minerals Inc. (TSX: ORA) (the "Company"
or "Aura Minerals") announced today that it has entered into an agreement with
a syndicate led by Canaccord Capital Corporation (the "Underwriters"), which
have agreed to purchase, on a bought deal private placement basis, 182,000,000
subscription receipts, (the "Subscription Receipts") at a price of C$0.55 per
Subscription Receipt for aggregate gross proceeds of C$100,100,000 (the
"Offering"). The Company has granted the Underwriters an Underwriters' option
to purchase up to C$25,025,000 of additional Subscription Receipts,
exercisable at any time up to 48 hours prior to the closing of the Offering.
The Offering is subject to certain conditions, including regulatory approval.
The Company intends to use the net proceeds of the Offering to acquire
from Yamana Gold Inc. (collectively, the "Acquisition"), the San Andrés Gold
Mine located in Honduras (such Honduras property being hereinafter referred to
as the "First Stage Property") and the Sao Francisco and Sao Vicente Gold
Mines located in Brazil (such Brazil properties being hereinafter referred to
as the "Second Stage Properties"). Please refer to the Company's June 9, 2009
press release announcing the Acquisition.
Each Subscription Receipt will entitle the holder thereof to acquire at
the Escrow Release Time (as defined herein), for no additional consideration
and subject to adjustment, one (1) common share of the Company (each an
"Underlying Share"). The Subscription Receipts will automatically convert into
Underlying Shares at the later to occur of (i) the Escrow Release Time, and
(ii) concurrent with the Prospectus Qualification (as herein defined), subject
to the Company satisfying the Escrow Release Conditions (as herein defined)
prior to the Final Escrow Deadline (as herein defined). The Subscription
Receipts will only convert into Underlying Shares pursuant to the foregoing
automatic conversion mechanism and will not be convertible upon any act by the
holder. The Subscription Receipts and the Underlying Shares will be subject to
a four month hold period in Canada.
Upon the closing of the Offering, 100% of the gross proceeds of the
Offering will be deposited in escrow (the "Escrowed Funds"). The Escrowed
Funds will be released from escrow to the Company, net of Offering expenses,
immediately prior to the closing of the acquisition by the Company of the
First Stage Property (the "Escrow Release Time"), provided that the following
conditions (the "Escrow Release Conditions") have been satisfied before the
Escrow Release Time:
a) all conditions precedent to the closing of the acquisition of the
First Stage Property, other than the payment of the cash portion of
the purchase price for the acquisition of the First Stage Property,
shall have been satisfied and there exists no inquiry, investigation
or other proceeding of a regulatory nature that would prevent the
closing of the Acquisition (other than jurisdiction-related
regulatory requirements for the Second Stage Properties), or would
prevent or restrict the trading in or the distribution of the common
shares of the Company, the Underlying Shares or the common shares
issuable in connection with the Acquisition; and
b) the Acquisition and the issue and listing of the common shares of the
Company to be issued and listed in connection, therewith, shall have
been approved by the Toronto Stock Exchange ("TSX").
In the event that either (i) the Escrow Release Conditions are not
satisfied by the Escrow Release Time, or (ii) the closing of the acquisition
of the First Stage Property does not occur on or before the date that is 115
days after the closing date (the "Final Escrow Deadline"), the Escrowed Funds,
plus any accrued interest earned thereon, shall be returned pro rata to each
holder of the Subscription Receipts in exchange for that number of
Subscription Receipts held by such holder, which will thereafter be cancelled.
If the Company fails to qualify the distribution of the Underlying Shares
upon conversion of the Subscription Receipts (the "Prospectus Qualification")
within 45 days after the closing of the Offering, each Subscription Receipt
will, subject to adjustment, thereafter be convertible for 1.05 Underlying
Shares, in lieu of one (1) Underlying Share.
Pursuant to the Offering, there will be 182,000,000 common shares
issuable, which, together with the 45,500,000 common shares issuable to the
Underwriters' option, will amount to 227,500,000 common shares. Pursuant to
the Acquisition, there will be a total of 109,721,308 common shares issuable
to Yamana Gold Inc., which, together with its current holdings of 7,000,000
common shares, will amount to 116,721,308 common shares, representing 13% of
the then issued common shares assuming the issue of the 227,500,000 common
shares pursuant to the Offering and the Underwriters' option and the
109,721,308 common shares pursuant to the Acquisition and the issue of no
other common shares. The maximum number of shares being issued pursuant to the
Offering and the Acquisition is 337,221,308, representing 56.8% of the
outstanding shares of the Company. Based on current publicly available
information as to the holdings of insiders, none of the insiders of the
Company, including the directors or officers of the Company, participated in
the Offering. In accordance with the requirements of the TSX for shareholder
approval for transactions pursuant to which greater than 25% of the
outstanding shares of the Company will be issued, and relying on an exemption
(Section 604(d)) of the TSX Company Manual) from the TSX requirement to obtain
such shareholder approval at a meeting of the shareholders of the Company, the
Company has sought and received the written consent of a shareholder holding
in excess of 52% of the issued shares of the Company approving of the
Acquisition and the Offering, including all securities to be issued in
Concurrently with the closing of the acquisition of the First Stage
Property, the Company intends to consolidate all of its common shares on the
basis of a factor of one new common share for five existing common shares,
subject to regulatory approval.
The Offering is expected to close on or about July 15, 2009.
About Aura Minerals Inc.
Aura Minerals is a Canadian resource company focused on the acquisition,
exploration and development of mining properties in the Americas. In addition
to the three newly acquired producing gold mines the Company owns the Aranzazu
copper mine in Mexico and the advanced stage Arapiraca Project in
north-eastern Brazil, which was originally explored in the 1980's and 1990's
for copper and gold and includes the Serrote Deposit. The project also
contains magnetite (up to 50%) and nickel and the Company plans to evaluate
the Arapiraca Project for all four metals which can be readily extracted. The
nearby infrastructure is excellent with ready access to electricity, water and
No stock exchange, securities commission or other regulatory authority
has approved or disapproved the information contained herein. This news
release contains forward-looking statements that are not historical facts.
Forward-looking statements involve risks, uncertainties and other factors that
could cause actual results, performance, prospects and opportunities to differ
materially from those expressed or implied by such forward-looking statements.
Factors that could cause actual results to differ materially from these
forward-looking statements include those risks set out in Aura Minerals'
public documents filed on SEDAR at www.sedar.com. Although Aura Minerals
believes that the assumptions and factors used in preparing the
forward-looking statements are reasonable, undue reliance should not be placed
on these statements, which only apply as of the date of this news release, and
no assurance can be given that such events will occur in the disclosed time
frames or at all. Aura Minerals disclaims any intention or obligation to
update or revise any forward-looking statement, whether as a result of new
information, future events or otherwise.
For further information:
For further information: please visit Aura Minerals Inc.'s web site at
www.auraminerals.com, or contact: Aura Minerals Inc., Patrick Downey,
President & Chief Executive Officer, Tel: (604) 669-4777, Fax: (604) 696-0212,
Email: email@example.com, Website: www.auraminerals.com