ECU Silver Mining Inc.
TSX : ECU

ECU Silver Mining Inc.

July 07, 2008 17:19 ET

ECU Silver to Issue Convertible Debentures

TORONTO, ONTARIO--(Marketwire - July 7, 2008) - ECU Silver Mining (TSX:ECU) (the "Company") announces that following discussions which commenced in May, it has reached agreements in principle for a non-brokered private placement of $4.0 to $5.0 million in principal amount of 12% convertible unsecured debentures maturing on July 31, 2013 ("Convertible Debentures").

The Convertible Debentures will be convertible into common shares of the Company ("Common Shares") at the holder's option at any time prior to maturity at a conversion price of $1.75 per Common Share (the "Conversion Price"), being a premium of 15% to the 20-day average of the closing prices of the Common Shares as of July 4, 2008.

The Convertible Debentures will be convertible into Common Shares at the Company's option at any time after the expiry of four months following the date of their issuance and prior to maturity, provided that the volume weighted average trading price of the Common Shares on the Toronto Stock Exchange during the 20 consecutive trading days ending on the fifth trading day preceding the date on which notice of conversion is given is not less than $2.85.

Prior to maturity, and subject to the holder's right to convert the Convertible Debentures at the Conversion Price, the Convertible Debentures will be redeemable at the Company's option, subject to a premium of 15%, 10% or 5% being paid if the Convertible Debentures are redeemed in the first, second or third year, respectively, following the date of their issuance. No premium will be payable in connection with any redemptions occurring after the expiration of the third year following the issuance of the Convertible Debentures.

Subject to any required regulatory approvals, the holder will have the right to require the Company to satisfy its obligation to pay interest or principal and any premium on the Convertible Debentures, in whole or in part, through the issuance of Common Shares at the Conversion Price.

The net proceeds of this offering of Convertible Debentures will be used by the Company for working capital purposes. The offering is scheduled to close on or about July 19, 2008 and is subject to certain conditions, including the receipt of all necessary regulatory approvals. The Company may pay a finder's fee of 5% in connection with the issuance of the Convertible Debentures.

Contact Information

  • CHF Investor Relations
    Chris Haldane
    Account Manager
    (416) 868-1079 ext. 237
    Email: chris@chfir.com
    or
    CHF Investor Relations
    Michael Borovec
    Account Manager
    (416) 868-1079 ext. 229
    Email: michael@chfir.com
    or
    ECU Silver Mining Inc.
    Stephen Altmann
    President
    (416) 366-2427
    Email: ecu@ecu.ca
    Website: www.ecu.ca