LAKEWOOD, CO, July 11, 2016 /PRNewswire/ - Energy Fuels
Inc. (NYSE MKT: UUUU; TSX: EFR) ("Energy Fuels" or the
"Company"), a leading producer of uranium in the United States, is pleased to announce that
it will seek the approval of the holders (the
"Debentureholders") of its Floating-Rate Convertible
Unsecured Subordinated Debentures (the "Debentures") to
amend the terms of the Debentures at a meeting of the
Debentureholders to be held on August 4,
2016 (the "Meeting"). The Company has filed a
Notice of Meeting and Management Information Circular (the
"Circular") on the System for Electronic Document Analysis
and Retrieval ("SEDAR") describing the proposed amendments
to the Debentures (the "Amendments") and management's and
the board of directors' recommendation that Debentureholders
approve the Amendments.
The proposed Amendments include the following general terms,
which are more fully described in the Circular:
- Extend the maturity date of the Debentures from June 30, 2017 to December
31, 2020;
- Reduce the conversion price of the Debentures from Cdn$15.00 to Cdn$4.15 per common share of the
Company;
- Add a redemption provision that enables the Company to redeem
the Debentures upon providing not less than 30-days' notice, in
cash, in whole or in part, at any time after June 30, 2019, but prior to maturity, at a price
of 101% of the aggregate principal amount redeemed;
- Add a right (the "Put Right") in favor of each
Debentureholder to enable the Debentureholder to require the
Company to purchase, for cash, on June 30,
2017 (the current maturity date) up to 20% of the Debentures
held by the Debentureholder at a price equal to 100% of the
principal amount purchased;
- Provide a consent fee to each Debentureholder who votes in
favor of the Amendments in the amount of Cdn$20.00 per Cdn$1,000 of principal amount of Debentures held,
subject to certain limitations as described in the Circular;
and
- Make other amendments to the Debenture Indenture (the
"Indenture") as required by the U.S. Trust Indenture Act of
1939, along with certain other amendments to remove provisions of
the Indenture that no longer apply.
Management and the board of directors is recommending that
Debentureholders approve the Amendments, as they believe the
Amendments are in the best interests of the Debentureholders,
the Company's common shareholders, and the
Company.
If the Amendments are approved, the extension of the maturity
date will afford the Debentureholders a longer period of time
during which to receive interest, which is currently at an
attractive rate compared to other investment opportunities.
The extended term will also create additional value in the form of
the conversion option imbedded in the Debentures. The
conversion price of the Debentures will be decreased, affording the
Debentureholders a more attractive price if the conversion option
is exercised. The Put Right provides the Debentureholders
with the option to monetize up to 20% of the Debentures held on
June 30, 2017. The extension
will provide financial flexibility for the Company, and decrease
the likelihood that the Company will elect to redeem the Debentures
for common shares rather than cash on maturity. Finally, any
Debentureholder who votes in favor of the Amendments will receive
additional value resulting from payment of the cash consent fee,
subject to the conditions on the payment of such fee as set out in
the Circular.
Stephen P. Antony, President and
CEO of Energy Fuels stated: "By extending the maturity date
of the Debentures, the Company will gain additional financial
flexibility for execution of its business plan and optimally
position itself for a recovering uranium market. If the
Amendments are approved, the Debentureholders will receive value in
terms of optionality, leverage, and cash, including the partial
redemption right, continued bi-annual interest payments at an
attractive rate, and a consent fee for those Debentureholders that
vote in favor of the Amendments. In addition, the
Debentureholders will have the right to convert the Debentures into
common shares of the Company at a lower conversion price, providing
further leverage to improving uranium markets. Finally,
approval of the Amendments will benefit the Company, the
Debentureholders, and existing common shareholders by decreasing
the potential for the Company to redeem the Debentures for common
shares upon the current maturity date of June 30, 2017. For the reasons detailed in
the Circular, management and the board of directors recommend that
the Debentureholders approve the Amendments."
For the Amendments to be adopted, not less than 66 2/3% of the
principal amount of the Debentures present or represented by proxy
at the Meeting must vote in favor of the Amendments at a meeting at
which at least 25% of the principal amount of the Debentures is
represented in person or by proxy. Alternatively, if holders
of not less than 66 2/3% of the outstanding principal amount of the
Debentures (being $14.67 million
aggregate principal amount) submit proxies consenting to the
Amendments (the "Requisite Consent"), the Company may accept
such proxies as written consents and, as permitted by the
Indenture, deem the Amendments approved by written consent and not
hold the meeting. If this occurs, only Debentureholders who
submit a proxy prior to receipt of the Requisite Consent will be
entitled to receive the consent fee.
About Energy Fuels: Energy Fuels is a
leading integrated US-based uranium mining company, supplying
U3O8 to major nuclear utilities. Energy
Fuels holds three of America's key uranium production centers, the
White Mesa Mill in Utah, the
Nichols Ranch Processing Facility in Wyoming, and the Alta Mesa Project in
Texas. The White Mesa Mill is the only conventional uranium
mill operating in the U.S. today and has a licensed capacity of
over 8 million pounds of U3O8 per year.
The Nichols Ranch Processing Facility is an in situ recovery
("ISR") production center with a licensed capacity of 2 million
pounds of U3O8 per year. Alta Mesa is an ISR production center currently
on standby. Energy Fuels also has the largest NI 43-101
compliant uranium resource portfolio in the U.S. among producers,
and uranium mining projects located in a number of Western U.S.
states, including one producing ISR project, mines on standby, and
mineral properties in various stages of permitting and
development. The Company's common shares are listed on the
NYSE MKT under the trading symbol "UUUU", and on the Toronto Stock
Exchange under the trading symbol "EFR". The Company's
Debentures are listed on the Toronto Stock Exchange under the
trading symbol "EFR.DB."
Cautionary Note Regarding Forward-Looking
Statements: Certain information contained in this
news release, including any information relating to: the Company
being a leading producer of uranium in the U.S.; the
expected benefits of the proposed Amendments to the
Debentureholders and to the Company's shareholders; whether or not
the proposed Amendments will be approved by the Debentureholders,
and if approved will ultimately be adopted by the Company; the
attractiveness of the interest rate on the Debentures; any expected
benefits associated with the proposed reduction in the conversion
price of the Debentures; any financial flexibility afforded the
Company by the proposed Amendments; the Company's expectations of
improving uranium markets; whether or not the Debentures will be
redeemed in cash or through the issuance of shares on maturity;
and any other statements regarding Energy Fuels' future
expectations, beliefs, goals or prospects; constitute
forward-looking information within the meaning of applicable
securities legislation (collectively, "forward-looking
statements"). All statements in this news release that are
not statements of historical fact (including statements containing
the words "expects", "does not expect", "plans", "anticipates",
"does not anticipate", "believes", "intends", "estimates",
"projects", "potential", "scheduled", "forecast", "budget" and
similar expressions) should be considered forward-looking
statements. All such forward-looking statements are subject
to important risk factors and uncertainties, many of which are
beyond Energy Fuels' ability to control or predict. A number
of important factors could cause actual results or events to differ
materially from those indicated or implied by such forward-looking
statements, including without limitation factors relating to: the
Company being a leading producer of uranium in the U.S.; the
expected benefits of the proposed Amendments to the
Debentureholders and to the Company's shareholders; whether or not
the proposed Amendments will be approved by the Debentureholders,
and if approved will ultimately be adopted by the Company; the
attractiveness of the interest rate on the Debentures; any expected
benefits associated with the proposed reduction in the conversion
price of the Debentures; any financial flexibility afforded the
Company by the proposed Amendments; the Company's expectations of
improving uranium markets; whether or not the Debentures will be
redeemed in cash or through the issuance of shares on maturity;
and other risk factors as described in Energy Fuels' most recent
annual report on Form 10-K and quarterly financial
reports. Energy Fuels assumes no obligation to update
the information in this communication, except as otherwise required
by law. Additional information identifying risks and
uncertainties is contained in Energy Fuels' filings with the
various securities commissions which are available online at
www.sec.gov and www.sedar.com. Forward-looking statements
are provided for the purpose of providing information about the
current expectations, beliefs and plans of the management of Energy
Fuels relating to the future. Readers are cautioned that such
statements may not be appropriate for other purposes. Readers
are also cautioned not to place undue reliance on these
forward-looking statements, that speak only as of the date
hereof.
SOURCE Energy Fuels Inc.