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Orbite announces $10 million debenture financing following the exercise of Series X Subscription Rights

July 15, 2014



ENP Newswire - 15 July 2014

Release date- 11072014 - Montreal (Quebec) - Orbite Aluminae Inc. (TSX: ORT) (OTCQX: EORBF) announces that Crede Capital Group, LLC has completed, late this afternoon, an investment of $10,000,000 in the form of convertible debentures and warrants pursuant to the exercise of the Series X Subscription Rights, as issued and announced on March 10, 2014.

'The funds from this placement will go towards the completion of our 3 tpd HPA facility. We continue to be well on schedule towards commissioning at the end of the year, with commercial production commencing in the first quarter of 2015,' stated Glenn Kelly, CEO of Orbite.

Under the placement, Crede has purchased units of the Company consisting of $10,000,000 principal amount of convertible unsecured debentures (the 'Debentures') and 13,000,000 warrants (the 'Warrants') of the Company. The Debentures will mature five years from issuance, namely July 11, 2019 and will bear interest at a rate of 7.5% per annum (the 'Interest').

Each Debenture will be convertible, at the option of the holder, at any time prior to the maturity date, into class A shares of the Company ('Shares') at a conversion price of $0.50 per Share (the 'Conversion Price'), representing the 5 day VWAP at time of the conditional exercise of the Series X subscription rights.

Upon conversion, the holder shall also be entitled to Shares equal to the additional interest such holder would have received if it had held the Debenture until maturity divided by the market price of the Shares prior to the date of conversion (the 'Make-Whole Amount'), in addition to accrued and unpaid Interest, in cash or in Shares at the Company's discretion. Each Warrant shall entitle the holder to purchase one Share for a period of three years from its issuance at a price of $0.60 per share (equivalent to the Conversion Price plus a 20% premium).

In connection with the placement, the regulatory authorities required certain changes to the initial terms of the Subscription Rights, namely that the maximum number of Shares issuable upon conversion of the Debentures on account of the principal amount and the Make-Whole Amount not exceed the principal amount of the Debentures converted, divided by the Conversion Price less 25%.

The parties further agreed that the Make-Whole Amount would not be reduced by 1% for each 1% that the current market price of the Shares at the time of conversion exceeds the Conversion Price and that the number of Warrants would correspond to 65% of the number of Shares into which the principal amount of Debentures is convertible.

In connection with the placement, the Company will pay a fee of 6% of the amount of the investment and issue 1,200,000 finder warrants to Euro Pacific Canada Inc. and Roth Capital LLC. Each finder warrant entitles the holder to purchase one Share for a price of $0.60 per share for a period of two years and is non transferable.

About Orbite

Orbite Aluminae Inc. is a Canadian cleantech company whose innovative and proprietary processes are expected to produce alumina and other high-value by-products, such as rare earth and rare metal oxides, at one of the lowest costs in the industry, and in a sustainable fashion, using feedstocks that include aluminous clay, kaolin, nepheline, bauxite, red mud and fly ash.

Orbite is currently finalizing its first commercial high-purity alumina (HPA) production plant in Cap-Chat, Quebec and has completed the basic engineering for a proposed smelter-grade alumina (SGA) production plant, which would use clay mined from its Grande-Vallee deposit. The Company's intellectual property portfolio contains 16 intellectual property families, and the Company owns the intellectual property rights to 11 patents and 72 pending patent applications in 10 different countries. The first intellectual property family is patented in Canada, USA, Australia, China, and Russia.

Forward-looking statements

Certain information contained in this document may include 'forward-looking information'. Without limiting the foregoing, the information and any forward-looking information may include statements regarding projects, costs, objectives and future returns of the Company or hypotheses underlying these items. In this document, words such as 'may', 'would', 'could', 'will', 'likely', 'believe', 'expect', 'anticipate', 'intend', 'plan', 'estimate' and similar words and the negative form thereof are used to identify forward-looking statements.

Forward-looking statements should not be read as guarantees of future performance or results, and will not necessarily be accurate indications of whether, or the times at or by which, such future performance will be achieved. Forward-looking statements and information are based on information available at the time and/or the Company management's good-faith beliefs with respect to future events and are subject to known or unknown risks, uncertainties, assumptions and other unpredictable factors, many of which are beyond the Company's control.

These risks uncertainties and assumptions include, but are not limited to, those described in the section of the Management's Discussion and Analysis (MD&A) entitled 'Risk and Uncertainties' as filed on May 13, 2014 on SEDAR.

The Company does not intend, nor does it undertake, any obligation to update or revise any forward-looking information or statements contained in this document to reflect subsequent information, events or circumstances or otherwise, except as required by applicable laws.

CONTACT:

Mark Lakmaaker

Investor Relations

Tel: 1-800-385-5451

Email: mlakmaaker@tmxequicom.com


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Source: ENP Newswire


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