TORONTO, September 18, 2015 /PRNewswire/ --
/NOT FOR DISTRIBUTION IN
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TSX-V: JAG
Jaguar Mining Inc. ("Jaguar" or the "Corporation") (TSX-V: JAG)
announced today that, due to investor feedback, the Corporation is
amending the terms of the offering of units of the Corporation
announced in the Corporation's press release dated September 14, 2015 and instead intends to conduct
a non-brokered private placement (the "Offering") of convertible
senior secured debentures ("Debentures") at a price of US$1,000 per Debenture for aggregate proceeds of
approximately US$20,000,000. The
Debentures will mature on the day that is three years following the
closing date of the Offering (the "Closing Date") and will bear
interest at a rate of 12% per annum, payable in cash on a quarterly
basis. Subject to acceptance by the TSX Venture Exchange, the
Debentures will be convertible at the holder's option into common
shares of the Corporation ("Common Shares") at a conversion price
of C$0.15 per Common Share (the
"Conversion Price"), being a ratio of 8,781 Common Shares per
US$1,000 principal amount of
Debentures, based on an exchange rate of US$0.7592 per C$1.00.
The Debentures will not be redeemable before the day that is 12
months plus one day after the Closing Date (the "Call Date"). With
30 days written notice, on and after the Call Date and prior to the
maturity date of the Debentures, the Debentures will be redeemable
in cash in whole or in part from time to time at the Corporation's
option at a price of: (i) 120% of the principal amount of the
Debentures outstanding within year one after the Call Date, and
(ii) 110% thereafter, plus, in each case, any accrued and unpaid
interest thereon.
The Debentures will be governed by an indenture containing
provisions and covenants including, but not limited to, further
indebtedness and restricted payments.
Pursuant to the Offering, certain insiders of Jaguar, namely
Outrider Management, LLC ("Outrider Management") and Dupont Capital
Management Corp. ("Dupont Capital"), have advised Jaguar that they
intend to subscribe for Debentures in the aggregate amounts of up
to US$6,500,000 and US$1,500,000, respectively.
The special committee of the board of directors of Jaguar, which
was established in December 2014 to
initiate a strategic review process and explore strategic
alternatives with the objective of maximizing value for the
Corporation's shareholders, unanimously passed a resolution
approving the Offering, which includes the proposed subscriptions
of Outrider Management (the "Outrider Subscription") and Dupont
Capital (the "Dupont Subscription").
Since Outrider Management and Dupont Capital are "related
parties" (within the meaning of Multilateral Instrument 61-101 -
Protection of Minority Security Holders in Special
Transactions ("MI 61-101")), each of the Outrider Subscription
and the Dupont Subscription is a "related party transaction"
(within the meaning of MI 61-101), which would require Jaguar to
obtain a formal valuation for, and minority approval of, the
Outrider Subscription and the Dupont Subscription, in the absence
of exemptions for such requirements.
For both the Outrider Subscription and the Dupont Subscription,
the Corporation is exempt from the formal valuation requirement
pursuant to section 5.5(b) of MI 61-101 on the basis that no
securities of Jaguar are listed or quoted on a market specified in
that provision.
With respect to the Dupont Subscription, the Corporation is
exempt from the minority approval requirement pursuant to section
5.7(b) of MI 61-101 on the basis that neither the fair market value
of the Debentures being distributed to Dupont Capital, nor the
consideration to be received by the Corporation for those
Debentures, exceeds C$2,500,000, in
addition to satisfying the other criteria therein. With respect to
the Outrider Subscription, Jaguar intends to apply to the Ontario
Securities Commission and the TSX Venture Exchange for an exemption
to allow it to obtain the requisite minority approval by way of
written approval from the majority of the minority shareholders
rather than by holding a shareholders' meeting. This exemption is
being sought on the basis that holding a shareholders' meeting is
costly and would delay the closing of the Offering. Jaguar
anticipates obtaining such exemptive relief prior, and as a
condition precedent, to closing the Offering.
The Offering is expected to close on or about October 8, 2015. Completion of the Offering is
subject to a number of conditions including receiving the approval
of the TSX Venture Exchange, obtaining the exemptive relief from
the Ontario Securities Commission and the TSX Venture Exchange and
obtaining written consents from a majority of the disinterested
minority shareholders.
The Debentures and the Common Shares underlying the Debentures
will be subject to a four month hold period pursuant to applicable
Canadian securities laws.
The Corporation plans to use the net proceeds of the Offering to
repay in full the outstanding US$8.4
million credit facility held by Renvest Global Resources
Fund c/o Renvest Mercantile Bancorp Inc. (the "Renvest Credit
Facility"), with the remainder to be used for general corporate
purposes and to advance asset optimization plans in conjunction
with the Corporation's ongoing development and producing activities
at its assets in Brazil.
This news release shall not constitute an offer to sell or the
solicitation of an offer to buy any securities in any
jurisdiction.
About Jaguar Mining Inc.
Jaguar is a gold producer with mining operations in a prolific
greenstone belt in the state of Minas Gerais, Brazil. Additionally, Jaguar wholly owns the
large-scale Gurupi Development Project in the state of Maranhão,
Brazil. In total, the Corporation
owns mineral claims covering an area of approximately 197,000
hectares. Additional information is available on the Corporation's
website at http://www.jaguarmining.com.
FORWARD-LOOKING STATEMENTS
Certain statements in this news release constitute
"Forward-Looking Statements" within the meaning of the U.S. Private
Securities Litigation Reform Act of 1995 and applicable Canadian
securities legislation. Such statements constitute
forward-looking statements (forecasts) under applicable securities
laws relating to future events or future performance and, in this
news release, include comments with respect to (i) the final terms
of the Debentures and the Offering, (ii) the participation of
Outrider Management and Dupont Capital in the Offering, (iii) the
size of the Offering and the subscription amounts of Outrider
Management and Dupont Capital, (iv) regulatory approvals being
obtained, including from the Ontario Securities Commission and the
TSX Venture Exchange, and the timing and terms of such approvals,
(v) there being an exemption from the minority approval and formal
valuation requirements under the Offering, (vi) the consent of
disinterested minority shareholders being obtained in writing with
respect to the Outrider Subscription, (vii) exemptive relief from
the minority approval requirement with respect to the Outrider
Subscription being obtained from the Ontario Securities Commission
and the TSX Venture Exchange, and the timing of such approvals,
(viii) the Corporation's use of the net proceeds of the Offering,
and (ix) the continued support of the Offering by the special
committee of Jaguar. Forward-looking statements can generally be
identified by the use of words such as "expected", "forecasted",
"targeted", "approximately", "intends", "plans", "anticipates",
"projects", "continue", "estimate", "believe" or variations of such
words and phrases, or statements that certain actions, events or
results "may", "could", "would", "might", or "will" be taken, occur
or be achieved. In this news release, information contained in
forward-looking statements is based on current expectations,
estimates and projections that involve a number of known and
unknown risks and uncertainties, including among others the
uncertainties inherent to capital markets in general, uncertainties
with respect to the success of the Offering, risk of not obtaining
all regulatory and minority shareholder approvals and the risks
with respect to the use of proceeds, which, if incorrect, may cause
actual results to differ materially from those anticipated by
Jaguar and described herein.
For additional information with respect to these and other
factors and assumptions underlying the forward-looking statements
made in this news release, see Corporation's most recent annual
information form and management's discussion and analysis, as well
as other public disclosure documents that can be accessed under the
issuer profile of "Jaguar Mining Inc." on SEDAR at
http://www.sedar.com. The forward-looking information set
forth herein reflects Jaguar's expectations as at the date of this
news release and is subject to change after such date. The
Corporation disclaims any intention or obligation to update or
revise any forward-looking statements, whether as a result of new
information, future events or otherwise, other than as required by
law. The forward-looking information contained in this news release
is expressly qualified by this cautionary statement.
The TSX Venture Exchange does not accept responsibility for
the adequacy or the accuracy of this release.
Derrick Weyrauch, Chief Financial
Officer, +1-(416)628-9601, dweyrauch@jaguarmining.com