TORONTO,
Oct. 27, 2014 /PRNewswire/ - Compania
Minera Auromin Ltda. ("Auromin") announces that on
October 24, 2014, Auromin, a company
controlled by David Thomson, a
director and officer of Cerro Grande Mining Corporation (the
"Company"), purchased 4,498,000 units of securities of the
Company (each, a "Unit") at a price of CDN$0.05 per Unit for aggregate cash proceeds to
the Company of US$200,000
(CDN$224,900) (the
"Placement"). Each Unit comprises one common
share of the Company (each a "Common Share") and one Common
Share purchase warrant (each, a "Warrant") with each Warrant
exercisable to acquire one Common Share until October 24, 2019 at a price of CDN$0.07 per share. In addition, Auromin
acquired 26,484,780 Common Shares (representing an issue price of
CDN$0.05 per share) in full and final
settlement of outstanding indebtedness of the Company owed to
Auromin in the amount of US$1,177,625
(CDN$1,324,239) consisting of accrued
but unpaid royalty payments, unpaid past services provided to the
Company in addition to cash advances (including interest thereon)
made to the Company (the "Debt Settlement"). All
amounts have been converted at an exchange ratio of US$1.00 to CDN$1.1245
Taking into account all of the Common Shares issued
in the Placement and the Debt Settlement, the Company now has
174,977,010 Common Shares issued and outstanding. The Common Shares
issued to Mr. Thomson in the Placement and the Debt Settlement
represent 17.70% of such outstanding Common Shares. Beneficial
ownership and control of the Common Shares and the Warrants was
acquired by Mr. Thomson.
Mr. Thomson now owns 52,718,929 Common Shares
representing 30.33% of the issued and outstanding Common Shares.
Mr. Thomson also holds stock options, convertible debentures and
warrants to acquire, in the aggregate, up to 5,299,057 Common
Shares.
Auromin's purpose in effecting the Placement and
the Debt Settlement was to provide an immediate source of cash to
the Company and to provide financial relief to the Company in a
time of financial hardship for the Company. Auromin may in the
future increase or decrease its ownership of securities of the
Company from time to time depending upon the business and prospects
of the Company and future market conditions.
Auromin's address and other contact information is
set forth below. For further information, including to obtain a
copy, once filed, of the report required to be filed by Mr. Thomson
and Auromin in accordance with applicable Canadian securities laws,
contact Auromin at the address specified below.
The issuance of this news release is not an
admission that an entity named in this news release owns or
controls any described securities or is a joint actor with another
named entity.
SOURCE Cerro Grande Mining Corporation