Sentient Executive GP III Ltd.

January 27, 2010 17:53 ET

Sentient Executive GP III Ltd. Acquires Securities of Strateco Resources Inc.

MONTREAL, QUEBEC--(Marketwire - Jan. 27, 2010) - NOT FOR DISTRIBUTION TO UNITED STATES NEWSWIRE SERVICES AND NOT FOR DISSEMINATION IN THE UNITED STATES

Sentient Executive GP III Ltd. (on behalf of Sentient Global Resources Fund III, L.P. and SGRF III Parallel I, L.P.) (collectively "Sentient") announces that it has acquired from Strateco Resources Inc. ("Strateco") 100,000 units for an amount of $95,000 (the "Units") and $14,905,000 of convertible notes (the "Notes") accompanied by common share purchase warrants (the "Warrants"). Each Unit consists of one common share (a "Share") of Strateco and one-half of one Warrant. Each tranche of $1,000 in Notes is accompanied by 527 Warrants.

Each Warrant entitles its holder to purchase one Share for $1.00 during a 24-month period following the closing, and for $1.05 during the subsequent period of 24 to 36 months after the closing, which occurred earlier today.

The Notes do not bear interest, are unsecured and mature five years plus one month after closing. They are convertible into Shares by the holder during this period at a price of $0.95 per Share, and are not redeemable by Strateco, except under certain conditions.

The subscribed Shares cannot be traded for a period of four months plus one day following the closing. Strateco's management has agreed to recommend the election of a Sentient representative to Strateco's Board of Directors.

Strateco has agreed to pay Sentient transaction fees equal to 5% of the gross proceeds of the private placement. These transaction fees, in the amount of $750,000, were paid in the corresponding number of Units.

Sentient currently holds an aggregate of 889,474 Shares representing 0,73% of the total number of issued and outstanding Shares. Should the convertible Notes be fully converted, Sentient would hold an interest of 16,578,948 Shares, or 11.98% of the total number of issued and outstanding Shares; in the event that all Warrants are also exercised, Sentient's interest would increase to 24,868,422 Shares, or 16.48% of the total Shares issued and outstanding.

Under relevant securities Laws, Sentient Global Resources Fund III, L.P. and SGRF III Parallel I, L.P. are related entities to Sentient Executive GP III Ltd. and may be considered as acting jointly or in concert with Sentient Executive GP III Ltd.

Sentient acquired the Units and the Notes for investment purposes only and not with a view to materially affect the control of Strateco. Sentient has no present intention of acquiring beneficial ownership or control over additional securities of Strateco.

Contact Information

  • Sue Bjuro
    345-946-0933