Marret Resource Corp. Provides Update on its Plan of Arrangement and Closes Third Tranche of Financing

TORONTO, Oct. 12, 2018 — Marret Resource Corp. (TSX:MAR) (“Marret” or the “Company”) is pleased to provide an update on its previously announced plan of arrangement transaction (the “Arrangement”) and announces that it has: (i) closed the third tranche (the “Third Tranche”) of its private placement (the “Private Placement”) of subscription receipts (the “Subscription Receipts”), raising an additional C$12,418,146; (ii) received the requisite approval from holders of Subscription Receipts to amend the Subscription Receipt Agreement (as defined below) in the manner described below; and (iii) migrated its listing to the Aequitas NEO Exchange Inc. (the “NEO Exchange”).

Arrangement Update

The Company obtained a final order from the Ontario Superior Court of Justice (Commercial List) approving the Arrangement on October 2, 2018. In order to facilitate the closing of the Third Tranche, the Company now expects the closing of the Arrangement to occur during the week of October 15, 2018.

Pursuant to the Arrangement, among other things:

 Stay Updated To Save Money & Time. Join Our Free Newsletter 
. Indepth Analysis & Opinion       . Interviews      . Exclusive Reports  
. Free Digital Magazines      News & updates      . Event Invitations 
                     
& Much More Delivered To Your Inbox For Free.
Submit
We Will Not Spam, Rent, or Sell Your Information.
All emails include an unsubscribe link. You may opt-out at any time. See our privacy policy.

 
  • each of the common shares in the capital of the Company (each, a “Share”) will be exchanged for one (1) common share in the capital of the Company created pursuant to the Arrangement (each, a “New Share”) and, subject to certain restrictions, one (1) contingent value right (“CVR”), with each CVR representing a contingent cash entitlement in respect of Cline Mining Corporation;
  • each shareholder had, subject to certain restrictions, the option exercisable until September 26, 2018, but was not required, to exchange all of its New Shares (subject in each case to proration) for: (i) $0.53 in cash for each New Share held (a “Cash Election”); or (ii) 7.62 warrants (each, a “Warrant”) exercisable for a period of seven (7) years from the effective date of the Arrangement at a price of $0.77 per share for each New Share held (a “Warrant Election”);
  • each of the Subscription Receipts issued or issuable pursuant to the Private Placement will automatically be converted, for no further consideration and without any further action by the holder thereof, into one (1) Share with each such Share immediately exchanged for one (1) New Share; and
  • the Company will acquire a newly formed entity established by an affiliate of BC Partners Investments Holdings Limited (“BCP”) in exchange for the issuance to BCP of an aggregate of 3,292,952 New Shares.

Based on final elections received by the Company pursuant to the Arrangement, as a result of proration, it is expected that each shareholder making a Warrant Election will receive Warrants in respect of approximately 72.5% of its New Shares deposited pursuant to such Warrant Election and will retain the remainder of its New Shares, and each shareholder making a Cash Election will receive cash consideration of $0.53 per share in respect of 95% of its New Shares deposited pursuant to such Cash Election and will retain the remainder of its New Shares.  As previously disclosed, the maximum number of Warrants issuable under the Arrangement is 20% of the New Shares at closing on a diluted basis (assuming exercise of the Warrants) and the maximum cash to be to be paid under the Arrangement has been prorated to ensure the Company will be in a position to meet the initial and continuous listing requirements of the NEO Exchange. Pursuant to the Arrangement, former holders of Shares will not be entitled to a fractional Warrant or New Share. Where the aggregate number of Warrants or New Shares to be issued to a former holder of Shares under the Arrangement would result in a fraction of Warrants or New Shares being issuable, the number of Warrants or New Shares to be received by such shareholder will be rounded down to the nearest whole Warrants or New Shares, as the case may be, without any payment for such fractional Warrants or New Shares. If the aggregate amount of cash which a shareholder is entitled to receive for all Shares transferred by such shareholder pursuant to the Arrangement would otherwise include a fraction of $0.01, then the aggregate cash to which such shareholder will be entitled to receive for all of its Shares transferred pursuant to the Arrangement will be rounded down to the nearest whole $0.01.

Further information about the Arrangement is available to shareholders under Marret’s profile on the System for Electronic Document Analysis and Retrieval (SEDAR) at www.sedar.com.

Private Placement

The Company closed the Third Tranche comprised of 22,578,448 Subscription Receipts issued at a price of $0.55 per Subscription Receipt for additional gross proceeds of approximately C$12,418,146. Together with the proceeds raised under the first tranche and second tranche of the Private Placement, the Company has now raised approximately C$40.5 million pursuant to the Private Placement. The Third Tranche was led by GMP Securities L.P. (the “Agent”).

Each Subscription Receipt will entitle the holder thereof to receive, without payment of additional consideration or further action, upon closing of the Arrangement, one Share which will be immediately and automatically exchanged for one New Share as a step in the Arrangement, which New Share will be freely tradeable upon the closing of the Arrangement. The Subscription Receipts issued under the Third Tranche will be subject to a statutory hold period ending February 12, 2019.

As with the first tranche and second tranche of the Private Placement, the gross proceeds received from the Third Tranche, less a portion of the Agent’s commission and the expenses of the Agent, were deposited into escrow with Computershare Trust Company of Canada, as escrow agent for the Subscription Receipts (the “Subscription Receipt Agent”), and will be released to the Company upon notice to the Subscription Receipt Agent that the escrow release conditions (the “Release Conditions“) specified in the subscription receipt agreement (as supplemented, the “Subscription Receipt Agreement”), between the Company, the Agent, BCP and the Subscription Receipt Agent have been satisfied. As consideration for the services of the Agent rendered in connection with the Third Tranche, the Company has agreed to pay the Agent an aggregate cash fee equal to 6.0% of the gross proceeds of the Third Tranche, except in respect of sales to certain purchasers identified by BCP for which either a cash fee equal to 3.0% of the gross proceeds from such purchasers, or no fee, is payable.

The Release Conditions include, among other things, the completion, satisfaction or waiver of all conditions precedent to the Arrangement and to the acquisition of the loan portfolio; the entering into of the definitive agreement for the Arrangement and the acquisition agreement for the primarily U.S. based loan portfolio; the receipt of all shareholder, court and regulatory approvals required for the Arrangement; and the New Common Shares being conditionally approved for listing on the NEO Exchange.

In the event that the Release Conditions (as may be amended) are not satisfied by October 25, 2018, the full proceeds of the Private Placement, plus accrued interest, will be returned to the purchasers of the Subscription Receipts, and the Subscription Receipts will be automatically cancelled and of no further force or effect.

It is intended that, upon completion of the Arrangement, the net proceeds of the Private Placement will be utilized primarily to acquire a diversified U.S. loan portfolio assembled by BCP and for general corporate purposes.

NEO Exchange Listing and Amendments

Further to the Company’s press release of September 24, 2018, effective at the close of trading on October 9, 2018, the Company voluntarily de-listed from the Toronto Stock Exchange and was listed on the NEO Exchange at the open of markets on October 10, 2018, in a halted state. The Shares will remain halted on the NEO Exchange until completion of the Arrangement, and it is expected that trading will resume on or about October 23, 2018.

As previously announced, in anticipation of moving its listing to the NEO Exchange, the Company sought the written consents of holders of the Subscription Receipts to approve, by way of written consent, certain amendments to the Subscription Receipt Agreement to reflect the proposed change in listing as well as certain procedural and administrative amendments resulting from certain tax structuring matters. The Company is pleased to announce that the amendments to the Subscription Receipt Agreement were approved in writing by approximately 70.5% of the Company’s holders of Subscription Receipts. As a result, the Company has entered into an amended and restated arrangement agreement, an agency agreement amending agreement and a supplement to the subscription receipt agreement to give effect to these minor amendments.

About Marret Resource Corp.

Marret Resource Corp. is currently focused on natural resource lending. The Company’s business is primarily directed to investing in public and private debt securities of and making term loans (including bridge and mezzanine debt) to issuers in a broad range of natural resource sectors, including energy, base and precious metals and other commodities, and issuers involved in exploration and development, and may also include financing other resource-related businesses and investing in public and private equity and quasi-equity securities. The Company seeks to generate income mainly from its lending activities, while taking advantage of additional upside through equity participation in the companies which it finances.

About BC Partners Advisors L.P. and BC Partners Credit

BC Partners is a leading international investment firm with over C$27 billion of assets under management in private equity and private credit. Established in 1986, BC Partners has played an active role in developing the European buyout market for three decades. Today, BC Partners executives operate across markets as an integrated team through the firm’s offices in North America and Europe. Since inception, BC Partners has completed 104 private equity investments in companies with a total enterprise value of €129 billion and is currently investing its tenth private equity fund. On the private credit front, BC Partners Credit is currently investing Special Opportunities Fund I. For more information, please visit www.bcpartners.com.

BC Partners Credit was launched in February 2017 and has pursued a strategy focused on identifying attractive credit opportunities in any market environment and across sectors, leveraging the deal sourcing and infrastructure made available from BC Partners.

For further information about Marret Resource Corp. and its ongoing business, please contact: Marret Investor Services 416.214.5800.

This press release contains forward-looking statements and information within the meaning of applicable securities legislation. Forward-looking statements can be identified by the expressions “seeks”, “expects”, “believes”, “estimates”, “will”, “target” and similar expressions. The forward-looking statements are not historical facts but reflect the current expectations of the Company regarding future results or events and are based on information currently available to them. Certain material factors and assumptions were applied in providing these forward-looking statements. The forward-looking events and circumstances discussed in this release include, but are not limited to, the timing and likelihood of the satisfaction of the Release Conditions, the timing and completion of the Arrangement and the acquisition of the loans forming the loan portfolio, the issuance of the Warrants, the issuance of CVRs, the amount of cash and the number of New Shares to be issued pursuant to the Arrangement, the effect of the Arrangement on the Company and the timing of the resumption of trading on the NEO Exchange. All forward-looking statements in this press release are qualified by these cautionary statements. The Company believes that the expectations reflected in forward-looking statements are based upon reasonable assumptions; however, the Company can give no assurance that the actual results or developments will be realized. These forward-looking statements are subject to a number of risks and uncertainties that could cause actual results or events to differ materially from current expectations, including the matters discussed under “Risks Factors” in the most recently filed annual information form and MD&A for the Company. Readers, therefore, should not place undue reliance on any such forward-looking statements. Further, a forward-looking statement speaks only as of the date on which such statement is made. The Company undertakes no obligation to publicly update any such statement or to reflect new information or the occurrence of future events or circumstances except as required by securities laws. These forward-looking statements are made as of the date of this press release.

This press release is not, and should not be construed as, an offer to sell or acquire any securities (including Shares and Subscription Receipts) in any jurisdiction.

 Stay Updated To Save Money & Time. Join Our Free Newsletter 
. Indepth Analysis & Opinion       . Interviews      . Exclusive Reports  
. Free Digital Magazines      News & updates      . Event Invitations 
                     
& Much More Delivered To Your Inbox For Free.
Submit
We Will Not Spam, Rent, or Sell Your Information.
All emails include an unsubscribe link. You may opt-out at any time. See our privacy policy.

 
Close
Stay Updated To Save Money & Time. Join Our Free Newsletter. 
. Indepth Analysis & Opinion       Interviews          . Exclusive Reports 
. Free Digital Magazines        . News & updates        . Event Invitations
& Much More Delivered To Your Inbox For Free. 
Submit
We Will Not Spam, Rent, or Sell Your Information.
All emails include an unsubscribe link. You may opt-out at any time. See our privacy policy.
 
Close