Timminco: Conversion of Note into Common Shares
Timminco Limited announced that ALD International LLC (the "LLC"), a controlled subsidiary of Safeguard International Fund, L.P., has elected to exercise its right to convert the entire principal amount outstanding of $4.5 million under the promissory note issued March 1, 2007 into Timminco common shares.
Consistent with the terms of the note, Timminco will issue approximately 10.7 million common shares at a conversion rate of $0.42 per common share, as full and final settlement of the principal amount outstanding. Timminco and the LLC have also agreed that Timminco will also issue approximately 0.3 million common shares at a price of $1.29 per common share in satisfaction of the net amount of accrued interest on the note of approximately $0.4 million. The price per share represents the five day volume weighted average price of Timminco common shares on the Toronto Stock Exchange. The issuance of the shares issuable in connection with the conversion of interest, which when combined with the shares issuable in connection with the conversion of principal represents approximately 7.4% of Timminco's issued and outstanding shares, is subject to receipt of all necessary regulatory approvals, including approval of the Toronto Stock Exchange.
Timminco produces silicon metal for the chemical (silicones), aluminum and electronic / solar industries. Timminco also produces solar grade silicon, using its proprietary technology for purifying silicon metal, for the solar photovoltaic energy industry.
This news release contains "forward-looking information", as such term is defined in applicable Canadian securities legislation, concerning Timminco's future financial or operating performance and other statements that express management's expectations or estimates of future developments, circumstances or results. Generally, forward-looking information can be identified by the use of forward-looking terminology such as "expects", "believes", "anticipates", "budget", "scheduled", "estimates", "forecasts", "intends", "plans" and variations of such words and phrases, or by statements that certain actions, events or results "may", "will", "could", "would" or "might" "be taken", "occur" or "be achieved". In this news release, such information includes statements regarding the issuance of Timminco common shares. Forward-looking information is based on a number of assumptions and estimates that, while considered reasonable by management based on the business and markets in which Timminco operates, are inherently subject to significant operational, economic and competitive uncertainties and contingencies. Timminco cautions that forward-looking information involves known and unknown risks, uncertainties and other factors that may cause Timminco's actual results, performance or achievements to be materially different from those expressed or implied by such information, including, but not limited to: liquidity risk; global economic uncertainty; credit risk; pricing and availability of raw materials; silicon metal selling prices; customer concentration; power supply and electricity prices; production interruptions; transportation disruptions; limited history with solar grade silicon; solar grade silicon selling prices; customer commitments for solar grade silicon; solar grade silicon production costs; quality of solar grade silicon; producing ingots with Timminco's solar grade silicon; protection of intellectual property rights; expansion of solar grade silicon production capacity; class action lawsuits; closure of former magnesium facilities; foreign exchange; investment in Applied Magnesium; interest rate risk; financing for capital expenditures; environmental liabilities; relationships with AMG; dependence upon key executives and employees; completion and integration of potential acquisitions, partnerships or joint ventures; risks with foreign operations and suppliers; environmental, health and safety laws and liabilities; intellectual property infringement claims; new regulatory requirements; labour disputes; and changes in tax laws. These factors are discussed in greater detail in Timminco's Annual Information Form for the year ended December 31, 2008, and in Timminco's most recent Management's Discussion and Analysis, each of which is available via the SEDAR website at www.sedar.com. Although Timminco has attempted to identify important factors that could cause actual results, performance or achievements to differ materially from those contained in forward-looking information, there can be other factors that cause results, performance or achievements not to be as anticipated, estimated or intended. There can be no assurance that such information will prove to be accurate or that management's expectations or estimates of future developments, circumstances or results will materialize. Accordingly, readers should not place undue reliance on forward-looking information. The forward- looking information in this news release is made as of the date of this news release and Timminco disclaims any intention or obligation to update or revise such information, except as required by applicable law.
Executive Vice President - Finance and CFO
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