TORONTO, ONTARIO--(Marketwired - Oct. 26, 2016) - Arnold T. Kondrat ("Kondrat") announces that he has disposed of a portion of the call option (the "Call Option") he had acquired in December 2015 in respect of an unsecured convertible debenture (the "Debenture") of Delrand Resources Limited ("Delrand"), as such disposition is described below (reference is also made to Kondrat's press release dated December 18, 2015 announcing the acquisition of the Call Option).
The Debenture is in the principal amount (the "Principal") of Cdn$1,300,000 and has a maturity date of June 18, 2018 (the "Maturity Date"). The terms of the Debenture also provide that (a) the holder thereof shall have the option to convert the outstanding Principal into common shares of Delrand ("Common Shares") at a price of Cdn$0.50 per share (the "Conversion Price"), and (b) within 30 days of the Maturity Date, Delrand may elect to repay the outstanding Principal in Common Shares at the Conversion Price, provided that the 5 day per share volume-weighted average trading price of the Common Shares at that time is at least Cdn$0.50. Reference is made to Delrand's press releases dated December 18, 2015 and January 15, 2016 for additional details in respect of the Debenture.
As described in Kondrat's December 18, 2015 press release, the Call Option entitled Kondrat to require the current holder (the "Holder") of the Debenture to sell to Kondrat all or a portion of the Debenture for a purchase price payable of Cdn$1.00 for each Cdn$1.00 of Principal purchased. Kondrat has today privately disposed of ownership of his right (the "Disposed Call Option") under the Call Option to require the Holder to sell to Kondrat Cdn$1,050,000 of the Principal of the Debenture, such that the Call Option now entitles Kondrat to require the Holder to sell to Kondrat all or a portion of Cdn$250,000 of the Principal of the Debenture for a purchase price payable of Cdn$1.00 for each Cdn$1.00 of Principal purchased.
2,100,000 Common Shares (the "Subject Underlying Shares") are issuable upon an exercise of the Disposed Call Option (which is now held by several holders) and the conversion of the said Cdn$1,050,000 of Principal into Common Shares at the Cdn$0.50 per share Conversion Price. Taking into account such conversion, the Subject Underlying Shares would represent 11.42% of the outstanding Common Shares.
500,000 Common Shares (the "Remaining Underlying Shares") are issuable upon an exercise by Kondrat of the remaining Call Option still held by Kondrat and the conversion of the Cdn$250,000 of Principal into Common Shares at the Cdn$0.50 per share Conversion Price. Kondrat currently owns 5,779,284 of the outstanding Common Shares. The said 5,779,284 Common Shares, together with the Remaining Underlying Shares, total 6,279,284 Common Shares. Taking into account such conversion by Kondrat, the said 6,279,284 Common Shares would represent 37.4% of the outstanding Common Shares. Immediately prior to the disposition of the Disposed Call Option and assuming an exercise in full of the Call Option and the conversion of all of the Principal into Common Shares, Kondrat would have held 8,379,284 (or 44.36%) of the outstanding Common Shares.
Kondrat is Chief Executive Officer and a director of the Company. He disposed of the Disposed Call Option for investment purposes, and may in the future increase or decrease his ownership of securities of Delrand from time to time depending upon the business and prospects of Delrand and future market conditions. He currently does not have any plan to acquire or dispose of additional securities of Delrand. Kondrat's address and Delrand's address is Suite 7070, 1 First Canadian Place, 100 King Street West, Toronto, Ontario, M5X 1E3.