Company sells 5% two-year unsecured convertible debentures in offering
By Devika Patel
Knoxville, Tenn., Nov. 19 – Rockwell Diamonds Inc. said it has arranged a C$4.1 million private placement of 5% two-year unsecured convertible debentures with principal shareholder Daboll Consultants Ltd., which will invest C$3 million, and chairman Mark Bristow, who will invest C$1.1 million.
The convertible debentures may be converted into common shares at the undiscounted five-day volume weighted average price of the stock.
Proceeds will be used for work programs on the company’s diamond projects and general working capital purposes.
“We are pleased that our chairman, Mark Bristow and Diacore, our beneficiation joint venture partner, have taken up these C$4.1 million debentures, which will enable Rockwell to strengthen its balance sheet and continue financing its organic growth projects,” president and chief executive officer James Campbell said in a press release. “Having funded two new processing plants, at Saxendrift Hill Complex and Niewejaarskraal, from working capital during the last two years, management felt it prudent to pursue this additional funding and received board approval to do so. All key shareholders were consulted and given an opportunity to participate. These two processing plants, together with Saxendrift, are currently processing gravels at an increased rate of some 380,000 cubic meters per month and continue to recover large, high quality rough diamonds that are being sold through our partnership with Diacore.
“The additional funding makes us more resilient in the short term while we continue with internal developments to increase our capacity towards our medium target of processing 500,000 cubic meters of quality gravels per month from our Middle Orange River operations as well as pursue external opportunities to grow and leverage our diamond value chain capabilities,” Campbell said in the release.
Rockwell is a diamond exploration company based in Vancouver, B.C.
| Issuer: | Rockwell Diamonds Inc.
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| Issue: | Unsecured convertible debentures
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| Amount: | C$4.1 million
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| Maturity: | Two years
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| Coupon: | 5%
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| Conversion price: | The undiscounted five-day volume weighted average price of the stock
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| Warrants: | No
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| Investor: | Daboll Consultants Ltd. (for C$3 million) and Mark Bristow (for C$1.1 million)
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| Pricing date: | Nov. 19
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| Stock symbol: | Toronto: RDI
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| Stock price: | C$0.30 at close Nov. 18
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| Market capitalization: | C$16.59 million
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