VANCOUVER, Dec. 15, 2016 /CNW/ - International Tower Hill
Mines Ltd. (TSX: ITH) (NYSE-MKT: THM) ("ITH" or the "Company")
announced today that it has arranged a non-brokered private
placement financing (the "Offering") of common shares to existing
major shareholders to raise gross proceeds of approximately
USD 22 million.
The Offering will consist of 45,833,334 common shares of the
Company, representing approximately 39.4% of the 116.4 million
shares currently issued and outstanding, at a price of USD 0.48 per share. The Company intends to
use the net proceeds of the private placement for full satisfaction
of the final payment due in January
2017 with respect to acquisition of certain mining claims
and related rights in the vicinity of the Livengood Gold Project in
Alaska (the "Project")
(approximately USD 14.8 million as of
September 30, 2016), continuation of
optimization studies to further improve and de-risk the Project,
required environmental baseline studies, and for general working
capital purposes.
The Offering will be taken up by the current institutional
shareholders of the Company, with Paulson & Co. Inc.
("Paulson") acquiring beneficial ownership of 32,429,842 shares,
Tocqueville Asset Management, L.P. ("Tocqueville") acquiring
beneficial ownership of 9,041,554 shares (taken together Paulson
and Tocqueville will acquire a total of 41,471,396 common shares,
representing approximately 35.6% of the common shares currently
issued and outstanding) and AngloGold Ashanti (U.S.A.) Exploration Inc. ("AngloGold")
acquiring beneficial ownership of 4,361,938 shares. Following
completion of the Offering, Paulson, Tocqueville and AngloGold will
beneficially own approximately 34.2%, 19.7%, and 9.5%,
respectively, of the Company's 162,186,972 common shares. In
connection with the Offering, the Company has agreed to appoint one
Paulson designee to the Company's board of directors at closing.
Commencing from the next annual general meeting of shareholders,
Paulson will have the right to nominate two individuals for
election to the board of directors.
The completion of the Offering is subject to a number of
conditions including obtaining any required regulatory approvals
including approval of the Toronto Stock Exchange ("TSX") and the
NYSE MKT. All common shares issued in the Offering will be subject
to a hold period in Canada of four
months from the closing of the Offering. All common shares
issued in the United States will
be subject to resale restrictions under U.S. federal and state
securities laws.
As the aggregate number of common shares issued pursuant to the
Offering exceeds 25% of the currently issued and outstanding common
shares of the Company, the number of common shares issued to
insiders pursuant to the Offering exceeds 10% of the currently
issued and outstanding common shares of the Company and the
Offering will materially affect control of the Company, the Company
would ordinarily be required to obtain shareholder approval under
the TSX Company Manual (the "Manual"). However, the Company has
applied to the TSX under Section 604(e) of the Company Manual for a
"financial hardship" exemption from the requirement to obtain
shareholder approval. The Company's board of directors, who are
free from any interest in the Offering and are unrelated to the
investors, have authorized such application on the basis of their
determination that the Company is in serious financial difficulty
and the Offering is designed to improve the Company's financial
situation and is reasonable for the Company in the
circumstances.
As a consequence of relying upon the financial hardship
exemption under Section 604(e) of the TSX Company Manual, the
Company expects that the TSX will commence a remedial de-listing
review, which is normal practice when a listed issuer seeks to rely
on this exemption. Although the Company believes that it will be in
compliance with all of the TSX listing requirements following
completion of the Offering, no assurance can be provided as to the
outcome of such review and, therefore, the Company's continued
qualification for listing on the TSX.
As Paulson and Tocqueville are insiders of the Company, the
Offering is a "related party transaction" within the meaning of
Multilateral Instrument 61-101 Protection of Minority Security
Holders in Special Transactions ("MI 61-101"). The
participation of Paulson and Tocqueville in the Offering is exempt
from the valuation and minority shareholder approval requirements
under MI 61-101 by virtue of the "financial hardship" exemptions
contained in Section 5.5(g) and 5.7(e) of MI 61-101.
The common shares to be issued in the Offering have not been and
will not be registered under the U.S. Securities Act of 1933, as
amended (the "1933 Act") or any applicable securities laws of any
state of the United States and may
not be offered or sold in the United
States or to, or for the account or benefit of, U.S. persons
(as defined in Regulation S under the 1933 Act) or persons in
the United States absent
registration or an applicable exemption from such registration
requirements. This press release shall not constitute an
offer to sell or the solicitation of an offer to buy any of the
common shares to be issued in the Offering, nor shall there be any
offer or sale of the common shares to be issued in the Offering in
any jurisdiction in which such offer, solicitation or sale would be
unlawful prior to registration or qualification under the
securities laws of any such jurisdiction.
About International Tower Hill Mines Ltd.
International Tower Hill Mines Ltd. controls a 100% interest of
the Livengood Gold Project, located along the paved Elliott
Highway, 70 miles north of Fairbanks,
Alaska.
On behalf of
International Tower Hill Mines Ltd.
(signed) Thomas E.
Irwin
Chief Executive Officer
Cautionary Note Regarding Forward-Looking Statements
This press release contains forward-looking statements and
forward-looking information (collectively, "forward-looking
statements") within the meaning of applicable Canadian and US
securities legislation. All statements, other than statements
of historical fact, included herein, including statements with
respect to the anticipated completion of the Offering and the
proposed use of the proceeds of the Offering by the Company, the
outcome of the expected remedial de-listing review by the TSX, the
ability of the Company to carry out and complete optimization
studies with respect to the Livengood Gold Project, the ability of
the Company to advance the Livengood Gold Project, the potential
development of any mine at Livengood, business and financing plans
and business trends are forward-looking statements. Although
the Company believes that such statements are reasonable, it can
give no assurance that such expectations will prove to be
correct. Forward-looking statements are typically identified
by words such as: believe, expect, anticipate, intend, estimate,
postulate, proposed, planned, potential and similar expressions, or
are those, which, by their nature, refer to future events.
The Company cautions investors that any forward-looking statements
by the Company are not guarantees of future results or performance,
and that actual results may differ materially from those in
forward-looking statements as a result of various factors,
including, but not limited to, risks associated with the timing and
pricing of the Offering, completion of the Offering, regulatory
approval/acceptance of the Offering, the use of proceeds from the
Offering, the potential inability of the Company to raise the
necessary capital or to be fully able to implement its business
strategies, and other risks and uncertainties disclosed in the
Company's annual report on Form 10-K and other reports filed with
the United States Securities and Exchange Commission (the "SEC"),
and certain securities commissions in Canada and other information released by the
Company and filed with the appropriate regulatory agencies.
All of the Company's Canadian public disclosure filings may be
accessed via www.sedar.com and its United
States public disclosure filings may be accessed via
www.sec.gov, and readers are urged to review these materials,
including the latest technical report filed with respect to the
Company's Livengood Gold Project.
This news release is not, and is not to be construed in any way
as, an offer to buy or sell securities in the United States or Canada.
SOURCE International Tower Hill Mines Ltd.