KELOWNA, November 16, 2012 – Diamcor Mining Inc.
(TSX-V.DMI) (the “Company”) is pleased to announce that it has
obtained an additional $4.0 million in financing from its long-term
strategic alliance partner, world famous premier luxury jewellery
and specialty retailer Tiffany & Co. (“Tiffany”). The $4,000,000 in financing will
be provided by Tiffany’s subsidiary, Tiffany & Co. Canada, via
a $2,400,000 term loan (the “Term Loan”) and a $1,600,000
convertible debt debenture (the “Convertible
Debenture”). The
transaction is subject to final acceptance by the TSX Venture
Exchange.
The Term Loan has a fixed rate of interest of 9% and
is secured by a promissory note (the “Promissory Note”) which is
non-amortizing until January 2014, at which time principal and
interest is payable monthly in accordance with a 36 month
amortization schedule.
The Company has the right to repay the outstanding principal and
any accrued and unpaid interest due under the Promissory Note at
any time without notice or penalty.
The Convertible Debenture has a fixed rate of interest
of 9% per annum, and is non-amortizing until January 2014,
following which time principal and interest is payable monthly in accordance
with a 36 month amortization schedule. The Company has the right to
repay the outstanding principal and any accrued and unpaid
interest, without penalty, on not less than 30-days’ notice and
subject to the conversion rights contained in the Convertible
Debenture. Under the conversion rights of the Convertible
Debenture, Tiffany & Co. Canada may convert the principal
amount of $1,600,000, along with any accrued and unpaid interest
due at that time, in whole or in part, into Class A Common Shares
(the “Shares”) of the Company at a conversion price of CAD $1.60
per Share. Under the
conversion scenario, a maximum of 1,090,000 Shares in the Company
would potentially be issued. Any Shares issued upon the
conversion of any amounts due under the Convertible Debenture will
be subject to a hold period which expires four months and one day
from the date of issuance of the Convertible Debenture.
The sourcing, negotiation and successful completion of
this additional financing transaction with Tiffany & Co. were
completed by the Company’s management and directors. As a result, no brokerage or
finder’s fees were incurred by the Company.
As part of the commissioning and testing exercises
underway at the Project, Company executives in conjunction with
various equipment manufacturers and engineering firms continuously
evaluated material from the deposit, the current quarrying and
in-field screening equipment, and in certain cases performed tests
on new equipment using material from the Project. As a result of these efforts, the
Company believes the deployment of additional dry-scrubbing and
screening equipment will not only more efficiently treat material
in the +10mm size fraction, but also further enhance the treatment
of all material and provide additional operational efficiencies and
enhance recoveries over the long-term. In conjunction with the
closing of this additional financing, the Company plans to proceed
with the immediate procurement of this equipment and expand the
current capabilities of the quarrying and in-field screening
operations. Additional
information on the equipment being added will be provided by the
Company in a separate news release in the coming weeks.
“We are very pleased with the continued support of our
strategic alliance partner Tiffany and Co. and their willingness to
support our expansion plans” commented Diamcor President and Chief Executive
Officer, Mr. Dean H. Taylor, “We believe deploying this
additional equipment now will allow us to further enhance results
which are already meeting or exceeding our expectations, and
provide us with the ability to expedite our overall goals and
targets for the long-term”, added Mr. Taylor.
Project Status Overview:
The extensive planning, development and construction
of site infrastructure at Krone-Endora at Venetia was successfully
completed over a period of less than 18 months, which has
positioned the Company to now further advance the development of
the Project and pursue near-term production. Following the completion of the
above-mentioned commissioning and testing exercises, the Company
plans to
focus on achieving targeted staged monthly operational increases
through a move to trial mining to provide the Company with
production and cash flow. The Company anticipates that the
move to full scale mining will coincide with the confirmation by
the South African Department of Mineral Resources of the issuance
of a mining right which has been applied for and is currently in
process. In
conjunction with the full scale mining exercises, the Company also
plans to carry out a bulk sampling programme on new areas of the
Project not previously accounted for in the initial NI 43-101
Technical Report filed by the Company as part of the acquisition
process. These efforts
are designed to support the future filing of an updated NI 43-101
Technical Report, and to assist Management when developing long-term production
targets and decisions for the Project.
Strategic Tiffany & Co.
Alliance:
As announced on March 29, 2011, the Company has
established a long-term strategic alliance and first right of
refusal with world famous New York based Tiffany & Co.
to purchase up to 100% of the future production of
rough diamonds (excluding Specials, individual stones of 10.8
carats or greater) from the Krone-Endora at Venetia Project at
current prices to be determined by the parties on an ongoing
basis. In conjunction
with this right of first refusal, Tiffany & Co. also provided
the Company with substantial financing to advance the Project as
quickly as possible. Tiffany & Co. is a publically
traded company which is listed on the New York Stock Exchange under
the symbol TIF.
Originally founded in 1837, the Tiffany’s name is now globally
recognised as one of the premier luxury jewellery and specialty
retailers in the world. Through Tiffany & Co. and
various other subsidiaries, the company is engaged in product
design, manufacturing, and retailing activities on a global
basis. As of July 31,
2012 Tiffany & Co. operated 260 stores and boutiques in the
Americas, Japan, Asia-Pacific, and Europe and engages in direct
selling through internet, catalog and business gift
operations. For
additional information on Tiffany & Co., please visit their
website at www.tiffany.com.
About Krone-Endora at Venetia:
On February 28, 2011, Diamcor successfully acquired
the Krone-Endora at Venetia Project from De Beers Consolidated
Mines Limited, consisting of the prospecting rights over the farms Krone 104 and
Endora 66, which represent a combined surface area of approximately
5,888 hectares directly adjacent to De Beers’ flagship Venetia
Diamond Mine in South Africa. De Beers previously completed
various exploration efforts on initial areas of interest comprised
of approximately 307 hectares, a summary of which was reported in
an initial Independent NI 43-101 Technical Report filed by the
Company on July 30, 2009. The deposits which occur on the
properties of Krone and Endora have been identified as a rare,
higher-grade “Alluvial” basal deposit which is covered by a
lower-grade upper “Eluvial” deposit. The deposits are proposed to be
the result of the direct-shift (in respect to the “Eluvial”
deposit) and erosion (in respect to the “Alluvial” deposit) of an
estimated combined 1,000 m (1 km) of material from the higher
grounds of the adjacent Venetia Kimberlite areas. The deposits on Krone-Endora
occur in two layers with an average total depth of less than 15.0
metres from surface to bedrock, allowing for a very low-cost mining
operation to be employed with the potential for near-term diamond
production from a known high-quality source. Krone-Endora also benefits from
the significant development of infrastructure and services already
in place due to its location directly adjacent to the Venetia
Mine. Since acquiring
Krone-Endora the Company has completed the construction and
installation of extensive infrastructure at the Project, along with
the installation of a purpose built modular processing
plant. Commissioning
of the processing plant is now underway, and the Company’s current
efforts are designed to be a continuation of the ongoing
advancement of the Project.
About Diamcor
Mining Inc:
Diamcor Mining Inc. is a fully
reporting publically traded junior diamond mining company which is
listed on the TSX Venture Exchange under the symbol V.DMI, and on
the OTC QX International under the symbol DMIFF. The Company
has a well-established operational and production history in South
Africa, and extensive experience supplying rough diamonds to the
world market. Rather than exposing itself to the high risks
and costs associated with exploration, the Company’s focus is on
the identification, acquisition, and operation of unique diamond
projects with near-term production potential such as the
Krone-Endora at Venetia Project. For additional information on
Diamcor, please visit our website at www.diamcormining.com.
On behalf of the Board of Directors
Mr. Dean H. Taylor
President & CEO
Diamcor Mining Inc.
DTaylor@diamcormining.com
Phone:
(250) 864-3326
Website:
www.diamcormining.com
This press release contains certain forward-looking
statements. While
these forward-looking statements represent our best current
judgement, they are subject to a variety of risks and uncertainties
that are beyond the Company’s ability to control or predict and
which could cause actual events or results to differ materially
from those anticipated in such forward-looking
statements. Further,
the Company expressly disclaims any obligation to update any
forward looking statements. Accordingly, readers should not
place undue reliance on forward-looking statements. This news release is not for
dissemination in the United States, to “U.S. Persons” or to United
States of America news services.
WE SEEK SAFE HARBOUR
Neither TSX Venture Exchange nor its Regulation Services
Provider (as that term is defined in policies of the TSX Venture
Exchange) accepts responsibility for the adequacy or accuracy of
this release.
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