Saguenay, Québec (September 11, 2012) – Arianne Resources Inc. (the “Company” or “Arianne”) is pleased to announce that it has closed the previously announced Cdn$10 million credit facility and a Cdn$1 million non-brokered private placement (see press release of the Company dated July 26, 2012). The credit facility can be drawn on as required and will allow the Company to fund its bankable feasibility study, operations and permitting activities on the Lac a Paul phosphate project (the “Project”) estimated to be completed in early 2014.
Under the terms of the credit facility, Arianne can draw up to Cdn$10 million and all amounts drawn will bear interest at a variable rate equal to 500 basis points over 3 month Canadian LIBOR. Additionally, the Company issued the lender 4 million non-transferable warrants which are subject to vesting periods imposed by the TSX Venture Exchange (the “Exchange”) (please refer to the July 26, 2012 press release for details on terms and conditions of the warrants). As at the date hereof, 2 million warrants have vested and the remaining 2 million warrants shall vest as additional amounts are drawn by the Company. The warrants are also subject to a mandatory hold period of four (4) months ending January 11, 2013. Lastly, Arianne has also provided the lender with a Cdn$1/tonne production fee on all phosphate concentrate sales from the Project. The production fee can be repurchased at anytime for a lump sum payment of Cdn$6 million. The production fee must also be repurchased by the Company for the same amount in the event of a change of control where at least 90% of Arianne’s issued and outstanding shares are acquired, purchased or otherwise owned by a third party, either by way of takeover bid or any other type of transaction having the same result. In connection with this transaction, Arianne paid on closing an arrangement fee of Cdn$100,000 to the agent and a commitment fee of Cdn$200,000 to the lender.
“This financing is a significant step forward for Arianne,” said Bernard Lapointe Chairman & CEO of the Company. “With this funding closed, we can now focus on completion of our bankable feasibility study with Cegertec WorleyParsons and securing the permits to develop our world-class Lac a Paul phosphate mining project.”
“The structure of this innovative deal is very beneficial to our shareholders,” added Jim Cowley, President of Arianne. “There is minimal dilution to Arianne’s shareholders, a low interest rate, and deferral of actual cash payments until the time when Arianne’s project development is more advanced and we are in a better position to repay them.”
Arianne is also pleased to announce the completion of its previously announced private placement for aggregate proceeds of $1,012,000. In total, Arianne issued 1,100,000 flow-through shares at a price of $0.92 per share. In this private placement, insiders of the Company have subscribed for aggregate proceeds of $95,680. The Company paid a cash commission of $80,960 in relation to the private placement and issued 88,000 non-transferable share purchase warrants exercisable at a price $0.92 per share until September 10, 2014. All securities issued pursuant to the private placements are subject to a mandatory hold period of four (4) months ending January 11, 2013. The proceeds of the private placement will be used by the Company for the exploration program on the Project.
The line of credit and the private placement are subject to final approval from the Exchange.
Arianne Resources Inc. (www.arianne-inc.com) owns and is developing the Lac a Paul phosphate deposit that produces a superior grade apatite concentrate grading close to 39% P2O5. The Company currently has 68.9 million shares issued.
Forward Looking Statements and Information
This news release contains “forward-looking statements” and “forward-looking information” within the meaning of applicable securities regulations in Canada and the United States (collectively, “forward-looking information”). The forward-looking information contained in this news release is made as of the date of this news release. Except as required under applicable securities legislation, the Company does not intend, and does not assume any obligation, to update this forward-looking information. Forward-looking information includes, but is not limited to, statements with respect to estimated mineral resources, anticipated effect of the completed drill results on the Project, timing of a feasibility study, and timing and expectations of future work programs. Often, but not always, forward-looking information can be identified by the use of words such as “plans”, “expects, “is expected”, “budget”, “scheduled”, “estimates”, forecasts”,
“intends”, “anticipates”, or “believes”, or the negatives thereof 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.
Any forward-looking statement speaks only as of the date on which it is made and except as may be required by applicable securities laws, the Company disclaims any intent or obligation to update any forward-looking statement.
Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
For more information:
Bernard Lapointe, CEO Tel: (418) 549-7316 firstname.lastname@example.org Jim Cowley, President Tel: (801) 599-3789 email@example.com Louis Morin, Investor Relations Tel: (514) 845-1101 firstname.lastname@example.org
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