Press Release and Early Warning Report Filed Pursuant to National Instrument
62-103 - RE: Avnel Gold Mining Limited
TORONTO, Aug. 5 /CNW/ -
1. Name and address of the offeror: This report is being filed on behalf of: Elliott Associates, L.P. ("Elliott Associates"), The Liverpool Limited Partnership ("Liverpool") Manchester Securities Corp. ("Manchester"), and Elliott International, L.P. ("Elliott International" and, collectively with Elliott Associates, Liverpool and Manchester, the "Offeror"). The business addresses of Elliott Associates, Liverpool, Manchester and Elliott International are as follows: c/o Elliott Management Corporation 712 Fifth Avenue 35th Floor New York, New York USA 10019 2. Designation and number or principal amount of securities and the offeror's securityholding percentage in the class of securities of which the offeror acquired ownership or control in the transaction or occurrence giving rise to the obligation to file the news release, and whether it was ownership or control that was acquired in those circumstances: On August 5, 2010 Elliott Associates, Elliott International, and Manchester agreed to purchase an aggregate of 40,858,691 units (the "Units") of Avnel Gold Mining Limited (the "Company"), each Unit comprised of one common share of the Company (a "Common Share") and one-half (1/2) of one Common Share purchase warrant (a "Warrant", which will entitle the holder thereof to purchase one Common Share) at a price of Cdn.$0.20 per Unit and for a total consideration of Cdn.$8,171,738 pursuant to subscription agreements with the Company. The number of Units issued is equal to the total outstanding principal amount and certain interest of all indebtedness owing to Elliott Associates, Elliott International and Manchester (the "Lenders") by the Company as at August 5, 2010 and the Units are issued in repayment and for the discharge of substantially all of the Company's outstanding indebtedness owed to the Lenders. 3. Designation and number or principal amount of securities and the Offeror's security holding percentage in the class of securities immediately after the transaction or occurrence giving rise to the obligation to file the news release: Following the transaction described in Item 2, the Offeror will hold 85,981,945 Common Shares and 20,429,346 Warrants, representing approximately 56.95% of the 186,840,120 outstanding Shares, assuming the exercise of Warrants into Common Shares. 4. Designation and number or principal amount of securities and the percentage of outstanding securities of the class of securities referred to in paragraph No. 3 over which (a) the Offeror, either alone or together with any joint actors, has ownership and control: 85,981,945 Common Shares and 20,429,346 Warrants, representing approximately 56.95% of the 186,840,120 outstanding Shares, assuming the exercise of Warrants into Common Shares. (b) the Offeror, either alone or together with any joint actors, has ownership but control is held by other persons or companies other than the offeror or any joint actor: None. (c) the Offeror, either alone or together with any joint actors, has exclusive or shared control but does not have ownership: None. 5. Name of the market where the transaction or occurrence that gave rise to the news release took place: N/A - private placement subscriptions. 6. Purpose of the Offeror and any joint actors in effecting the transaction or occurrence that gave rise to the news release, including any future intention to acquire ownership of, or control over, additional securities of the reporting issuer: The acquisitions by Elliott Associates, Elliott International and Manchester were made in connection with a conversion of indebtedness into equity and, in the case of Elliott Associates, Elliott International, and Liverpool, additionally in the ordinary course of their investment activities. Other than the possible exercise of the Warrants, the Offeror has no current plan or proposal which relates to, or would result in acquiring additional ownership or control over the securities of the Company. The Offeror may or may not purchase or sell securities of the Company in the future on the open market or in private transactions, depending on market conditions and other factors material to the Offeror's investment decision. 7. The general nature and the material terms of any agreement, other than lending arrangements, with respect to securities of the reporting issuer entered into by the Offeror, or any joint actor, and the issuer of the securities or any other entity in connection with the transaction or occurrence giving rise to the news release, including agreements with respect to the acquisition, holding, disposition or voting of any of the securities: None. 8. Names of any joint actors in connection with the disclosure in this news release and report of acquisition: Paul E. Singer ("Singer") is a general partner of Elliott Associates. Hambledon, Inc., which is controlled by Singer, is the general partner of Elliott International. The Liverpool Limited Partnership, a Bermuda limited partnership, is a subsidiary of Elliott Associates. Manchester Securities Corp., a New York corporation, is a subsidiary of Elliott Associates. 9. The nature and value of the consideration paid by the Offeror: See Item 2 above. 10. Description of any change in any material fact set out in a previous report filed in connection with the subject securities: See Item 2 above.
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