TORONTO, Nov. 9, 2015 /PRNewswire/ --
Lloyd I. Miller and entities
related to him (the "Miller Holders") announced today that they
have commenced discussions with other holders of the Gold-Linked
Notes issued by Gran Columbia Gold Corp. (the "Company") to form an
ad hoc group to oppose the Company's debt restructure proposal
under the Business Corporations Act (British Columbia). The Miller Holders
believe that the Company's restructure proposal for the senior
Gold-Linked Notes significantly undervalues the Gold-Linked Notes.
On September 29, 2015, the Company
announced its restructuring proposal for both its senior
Gold-Linked Notes and its junior Silver Linked Notes (the
"Restructure Proposal"). The Company has set a meeting
concerning the Restructure Proposal for November 27, 2015. The Miller Holders
(owners of approximately 18% of the $100
Million Gold-Linked Notes) believe that the Company's
Restructure Proposal fails to honor the senior, secured status of
the Gold-Linked Notes.
On November 4, 2015, the Miller
Holders noted their opposition to the Restructure Proposal for the
following reasons (among others). The Restructure
Proposal:
- Significantly undervalues the Gold-Linked Notes.
- Improperly favors the junior Silver-Linked Notes and equity
interests.
- Ignores the collateral rights covering the Gold-Linked
Notes.
- Provides for interest on the Gold-Linked Notes to be "paid in
kind" at the Company's election rather than cash despite the
Company's financial performance.
- Provides for conversion of the Gold-Linked Notes into common
equity and the Company's election (the same securities into which
the junior Silver Linked Notes may be converted).
- Establishes an inferior conversion price for the senior
Gold-Linked Notes in comparison to the junior Silver-Linked
Notes.
- Was proposed without significant involvement of the major
holders of Gold-Linked Notes.
The Miller Holders have concluded that the foregoing and other
features of the Restructure Proposal are not in the best interests
of the holders of the Gold-Linked Notes. As such, the Miller
Holders are opposing the current Restructure Proposal, whether
pursued under the Business Corporations Act or the Companies'
Creditors Arrangement Act (CCAA).
On November 4, 2015, the Miller
Holders announced their intention to form an ad hoc group to
address the Restructure Proposal. Since that time, holders
opposing the restructure proposal have contacted the Miller
Holders. The Miller Holders may be contacted by additional
non-insider holders of the Gold-Linked Notes interested in joining
the ad hoc group at the number below.
THIS PRESS RELEASE DOES NOT CONSTITUTE AN OFFER TO SELL OR A
SOLICITATION OF AN OFFER TO SELL ANY OF THE SECURITIES DESCRIBED
HEREIN IN THE UNITED STATES. THESE
SECURITIES HAVE NOT HAVE BEEN REGISTERED UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS
AMENDED, OR ANY STATE SECURITIES LAWS AND AS A RESULT MAY NOT BE
OFFERED OR SOLD IN THE UNITED
STATES OR TO U.S. PERSONS UNLESS REGISTERED OR EXEMPT
THEREFROM.
FORWARD LOOKING STATEMENTS
This news release may contain forward-looking statements or
forward looking information under securities legislation including
the intention of the Miller Holders to oppose the restructure
proposal and their formation of an ad hoc group.
To view the original version on PR Newswire,
visit:http://www.prnewswire.com/news-releases/lloyd-i-miller-iii-and-related-senior-gold-linked-noteholders-commence-discussions-with-holders-regarding-formation-of-ad-hoc-group-in-opposition-to-restructuring-proposal-by-gran-columbia-gold-corp-tsx-gcm-otc-tprff-which-300174831.html
SOURCE the Miller Holders