Endomines resolves on a fully guaranteed directed share issue to noteholders to strengthen financial position enabling further development

Endomines resolves on a fully guaranteed directed share issue to noteholders to strengthen financial position enabling further development

Endomines AB, Stock Exchange Release 18 February 2022 at 18:30 CET

NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, IN WHOLE OR IN PART, DIRECTLY OR INDIRECTLY IN OR INTO AUSTRALIA, CANADA, HONG KONG, JAPAN, SINGAPORE, SOUTH AFRICA, NEW ZEALAND, THE UNITED STATES, OR ANY OTHER COUNTRY WHERE SUCH PUBLICATION, NOTICE OR DISTRIBUTION WOULD VIOLATE APPLICABLE LAWS OR RULES OR WOULD REQUIRE ADDITIONAL DOCUMENTS TO BE PREPARED OR REGISTERED OR REQUIRE ANY OTHER MEASURES TO BE TAKEN, IN ADDITION TO THE REQUIREMENTS UNDER SWEDISH LAW. PLEASE SEE “IMPORTANT INFORMATION” AT THE END OF THIS PRESS RELEASE.

Endomines resolves on a fully guaranteed directed share issue to noteholders to strengthen financial position enabling further development

The Board of Directors of Endomines AB (publ) ("Endomines" or the "Company") has, based on the authorization granted by the Annual General Meeting on 10 June 2021, resolved on a fully guaranteed directed issue of 28 571 429 shares to the Company´s noteholders (the "Noteholders"), at a price of EUR 0.21 (corresponding to SEK 2.221¹) per share (the “Directed Issue”), providing total issue proceeds of EUR 6,000,000 (corresponding to SEK 63,466,2011) before issue expenses. The proceeds from the Directed Issue are intended to be used primarily to redeem all of the Company's issued and outstanding senior secured fixed rate notes (ISIN: SE0012323632) (the "Notes"). The redemption date for the Notes is 7 March 2022.

Endomines secures a significantly stronger financial position to enable further development and growth with the mining exploration and development. 

The Directed Issue will enable the Company: to redeem all of the issued and outstanding Notes; to decrease the costs of the Company's financing; to provide additional capital for Company working capital; and as result significantly strengthen the Company's balance sheet. With the redemption of the Bond and lowering cost of borrowing, the Company will now be able to focus on enhancing and securing a stable increase of cash flow from its mining operations in the future. The Board of Directors has evaluated various financing options and deems that an issue of new shares to the Noteholders on these terms is currently the best option for the Company and its shareholders to ensure the most time- and cost-effective financing of the redemption of the outstanding senior secured fixed notes and the Company’s business compared to other possible financing options.

The Noteholders will have a right to subscribe for shares in the Directed Issue, pro rata in relation to the number of Notes held by the participating Noteholders.

The major noteholders with other investors have entered into guarantee commitments corresponding to 100 percent of the shares in the Directed Issue. The guarantee commitments will not entitle the guarantors to any compensation.

The Directed Issue is expected to be registered with the Swedish Companies Registration Office around 3 March 2022. Following the registration of the Directed Issue, the share capital in Endomines will increase by SEK 57,142,858 to SEK 515,548,930, and the total number of outstanding shares and votes in Endomines will increase by 28,571,429 shares and votes to 257 774 465 shares and votes. The Directed Share Issue entails a dilution of approximately 11.08 percent of the number of votes and shares in the Company, based on the total number of shares and votes in Endomines after the Directed Issue.

Contact person

Mikko Sopanen, CFO, mikko.sopanen@endomines.com, +358 50 434 7439

This is information that Endomines AB (publ) is obliged to make public pursuant to the EU Market Abuse Regulation (EU nr 596/2014). This information was submitted for publication through the contact person set out above at 18:30 CET on 18 February 2022.

About Endomines

Endomines is a mining and exploration company with its primary focus on gold. The Company explores for gold along the Karelian Gold Line in Eastern Finland and develops mining operations in Idaho, USA and Finland. Endomines aims to improve its long-term growth prospects by increasing its exploration activities and through acquisitions. Endomines aims to acquire deposits that are situated in stable jurisdictions and can be brought to production rapidly with limited investments.

The shares trade on Nasdaq Stockholm (ENDO) and Nasdaq Helsinki (ENDOM).

Important information

This press release is not and does not form a part of any offer for sale of securities. Copies of this communication may not be made in, and may not be distributed or sent into, Australia, Canada, Hong Kong, Japan, Singapore, South Africa, New Zealand, the United States, or any other jurisdiction in which distribution of this press release would be unlawful or would require registration or other measures. The distribution of this announcement in other jurisdictions may be restricted by law and persons into whose possession this announcement comes should inform themselves about, and observe, any such restrictions.

The securities referred to in this announcement have not been and will not be registered under the U.S. Securities Act of 1933, as amended (the "Securities Act"), or under the securities laws of any state or other jurisdiction of the United States and, accordingly, may not be offered or sold in the United States except pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act and in compliance with applicable state securities law. The Company does not intend to register any part of the Directed Issue in the United States or to conduct a public offering of shares in the United States.

The securities referred to herein have not been and will not be registered under the applicable securities laws of Australia, Canada, Hong Kong, Japan, Singapore, South Africa or New Zealand and, subject to certain exemptions, may not be offered or sold in or into or for the account or benefit of any person having a registered address in, or located or resident in, Australia, Canada, Hong Kong, Japan, Singapore, South Africa or New Zealand. There will be no public offering of the securities described herein in Australia, Canada, Hong Kong, Japan, Singapore, South Africa or New Zealand.

This press release is not a prospectus for purposes of Prospectus Regulation (EU) 2017/1129 of the European Parliament and of the Council of 14 June 2017 and its delegated and implemented regulations (the “Prospectus Regulation”) and has not been approved by any regulatory authority in any jurisdiction. The Company has not authorized any offer to the public of securities in any EEA Member State and no prospectus has been or will be prepared in connection with the directed new share issue. In any EEA Member State, this communication is only addressed to and is only directed at qualified investors in that Member State within the meaning of the Prospectus Regulation.

In the United Kingdom, this document and any other materials in relation to the securities described herein is only being distributed to, and is only directed at, and any investment or investment activity to which this document relates is available only to, and will be engaged in only with, “qualified investors” who are (i) persons having professional experience in matters relating to investments who fall within the definition of “investment professionals” in Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 (the “Order”); or (ii) high net worth entities falling within Article 49(2)(a) to (d) of the Order (all such persons together being referred to as “relevant persons”). In the United Kingdom, any investment or investment activity to which this communication relates is available only to, and will be engaged in only with, relevant persons. Persons who are not relevant persons should not take any action on the basis of this press release and should not act or rely on it.

Any investment decision in connection with the Directed Issue must be made on the basis of all publicly available information relating to the Company and the issued shares. The information contained in this announcement is for background purposes only and does not purport to be full or complete. No reliance may be placed for any purpose on the information contained in this announcement or its accuracy or completeness. This announcement does not purport to identify or suggest the risks (direct or indirect) which may be associated with an investment in the Company or the new shares.