Uranium One Inc.

Uranium One Inc.

February 18, 2010 07:41 ET

Uranium One Announces C$250 Million Bought Deal Financing of Convertible Unsecured Subordinated Debentures



Uranium One Inc. ("Uranium One" or the "Company") (TSX:UUU) today announced that it has entered into an agreement for a bought deal financing with a syndicate of underwriters, led by GMP Securities L.P. and including Canaccord Financial Ltd., BMO Capital Markets, CIBC World Markets Inc., RBC Capital Markets and Paradigm Capital Inc. (collectively, the "Underwriters") for C$250,000,000 aggregate principal amount of convertible unsecured subordinated debentures (the "Convertible Debentures") together with an over-allotment option of up to C$37,500,000 exercisable at any time up to the closing date.


- March 12, 2015 maturity

- Interest rate of 5.0% per annum, payable semi-annually, from the date of receipt of all necessary Kazakh approvals for the conversion of the Convertible Debentures (the "Approval Date")

- Interest rate of 7.5% per annum, payable semi-annually, from the date of issue to the Approval Date

- Conversion price of C$4.00 per common share, representing a premium of approximately 25.8% based on a reference price of C$3.18 (closing price on February 17, 2010)

The offering is scheduled to close on or about March 12, 2010, and is subject to the satisfaction of customary closing conditions, including approval of the Toronto Stock Exchange and the securities regulatory authorities.

The Company intends to use the net proceeds for potential acquisitions, working capital, general corporate purposes and to finance its operations and development projects.

The Convertible Debentures will mature on March 12, 2015. From and after the Approval Date, the Convertible Debentures will bear a rate of interest at 5.0% per annum, payable semi-annually. Prior to the Approval Date, the Convertible Debentures will bear an interest rate of 7.5% per annum, payable semi-annually from the date of issue.

After the Approval Date, the Convertible Debentures will be convertible, at the option of the holder, into common shares of the Company at a conversion rate of 250 common shares per C$1,000 principal amount of Convertible Debentures, which is equal to a conversion price of C$4.00 per common share. The Convertible Debentures will not be redeemable.

The Convertible Debentures will be direct, unsecured obligations of the Company, subordinated to the Company's existing credit facility and to the Company's outstanding 4.25% Convertible Debentures due 2011, and ranking equally with all other unsecured indebtedness of the Company.

A preliminary short form prospectus will be filed with the securities regulators in each of the Provinces of Canada, except Quebec, pursuant to National Instrument 44-101 Short Form Prospectus Distributions. The securities offered have not been and will not be registered under the U.S. Securities Act of 1933, as amended, and may not be offered or sold in the United States absent registration or an applicable exemption from the registration requirements of such Act. This press release does not constitute an offer to sell or the solicitation of an offer to buy the securities in any jurisdiction.

About Uranium One

Uranium One is one of the world's largest publicly traded uranium producers, with a globally diversified portfolio of assets located in Kazakhstan, the United States, South Africa and Australia.

Cautionary Statement

Forward-looking statements: This press release contains certain forward-looking statements. Forward-looking statements include but are not limited to those with respect to the price of uranium, the estimation of mineral resources and reserves, the realization of mineral reserve estimates, the timing and amount of estimated future production, costs of production, capital expenditures, costs and timing of the development of new deposits, success of exploration activities, permitting time lines, currency fluctuations, requirements for additional capital, government regulation of mining operations, environmental risks, unanticipated reclamation expenses, title disputes or claims and limitations on insurance coverage and the timing and possible outcome of pending litigation. In certain cases, forward-looking statements can be identified by the use of words such as "plans", "expects" or "does not expect", "is expected", "budget", "scheduled", "estimates", "forecasts", "intends", "anticipates" or "does not anticipate", or "believes" or variations of such words and phrases, or state that certain actions, events or results "may", "could", "would", "might" or "will" be taken, occur or be achieved. Forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of Uranium One to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements. Such risks and uncertainties include, among others, changes in market conditions, the actual results of current exploration activities, conclusions of economic evaluations, changes in project parameters as plans continue to be refined, project cost overruns or unanticipated costs or expenses, possible variations in grade and ore densities or recovery rates, failure of plant, equipment or processes to operate as anticipated, accidents, labour disputes or other risks of the mining industry,
exchange rate and uranium price fluctuations, delays in obtaining government approvals or financing or in completion of development or construction activities, changes in, and the effect of government policy, risks relating to the timing and completion of the transactions described in this press release, the potential benefits thereof, risks relating to the benefits derived by the Corporation from strategic relationships, risks relating to the integration of acquisitions, to international operations, to the price of uranium as well as those factors referred to in the section entitled "Risk Factors" in Uranium One's Annual Information Form for the year ended December 31, 2008, which is available on SEDAR at www.sedar.com, and which should be reviewed in conjunction with this document. Although Uranium One has attempted to identify important factors that could cause actual actions, events or results to differ materially from those described in forward-looking statements, there may be other factors that cause actions, events or results not to be as anticipated, estimated or intended. There can be no assurance that forward-looking statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forward-looking statements. Uranium One expressly disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except in accordance with applicable securities laws.

For further information about Uranium One, please visit www.uranium1.com.

No stock exchange, securities commission or other regulatory authority has approved or disapproved the information contained herein.

Contact Information

  • Uranium One Inc.
    Jean Nortier
    Chief Executive Officer
    +1 604 601 5642
    Uranium One Inc.
    Chris Sattler
    Executive Vice President,
    Corporate Development and Investor Relations
    + 1 416 350 3657