Mariana Resources secures up to US$6 million investment to fund growth of South American exploration portfolio over the next 12 months

Mariana Resources Ltd (“Mariana” or “the Company”), the AIM quoted exploration and development company focused in Peru, southern Argentina and Chile, announces it has entered into a convertible securities issuance deed (the “Agreement”) with Bergen Global Opportunity Fund, LP (“Bergen” or the “Investor”), an institutional investment fund managed by Bergen Asset Management, LLC, a New York asset management firm.  The Agreement allows for the issuance by the Company of zero coupon convertible securities for an initial amount of US$2,000,000 immediately, and up to a further US$4,000,000 (the “Convertible Securities”).

Highlights:

• Flexible funding at the option of the Company by way of US$6,000,000 in three staged zero coupon convertible securities allowing Mariana to fund further working capital in its South American portfolio over the next 12 months
• Initial drawdown of US$2,000,000, with conversion prices tied to future prices of the Company’s shares and with the staged funding which is at the Company’s option,  potentially minimising dilution for existing shareholders
• A number of contractual limitations imposed on the Investor, e.g. no short selling of the Company’s shares is permitted, and the Investor has agreed to substantial limits on its ability to sell shares.

Mariana’s CEO Glen Parsons said, “We are delighted to welcome another institutional investor, Bergen, to our register.  The securing of this US$6 million funding comes at an exciting time for Mariana following our recent entry into an option to secure up to 70% of two potentially strategic high grade gold tenements, the Rurimarac Properties in Peru.“

“This cash injection will help us to further develop our growing South American focused portfolio.  This includes the highly prospective Soledad copper-gold property in Peru where we are currently working through our results to determine a follow-up drill programme; our Peruvian Condor de Oro copper-gold-molybdenum project where we are strategically assessing how we advance the project and evaluating the joint venture possibilities; and our Argentinian projects, Las Calandrias and Los Cisnes properties, where we are applying a low cost exploration strategy to develop new high grade targets.  This funding also gives us the flexibility to look at other potentially exciting opportunities that could bolster our portfolio.  I look forward to providing further updates in due course.”

Further Information:

Bergen Global Opportunity Fund, LP (the “Fund”) is managed by Bergen Asset Management LLC, a New York-based asset management company. The Fund invests in high-growth public and private companies in a range of industries around the world, and has a track record of successful investments in ASX and AIM-listed small-cap resources companies.

The Convertible Securities will (subject to the satisfaction of certain conditions) be issued in three tranches and the Company will make an announcement of the issue of each Convertible Security. The initial Convertible Security will have the nominal value of US$2,180,000 and will be issued shortly. Each of the two subsequent Convertible Securities will be issued 100 days after the date of issuance of the previous Convertible Security and have the purchase price that will be equal to its nominal value (of between US$1,000,000 and US$2,000,000 each).

The Convertible Securities will have a term ending on16 September 2016.

The Company will have the right to repurchase the Convertible Securities for cash at 110% of their nominal value (and without a fee or penalty) within a certain redemption period. Both parties will have the right to terminate the Agreement following the funding of the first Convertible Security and not to issue the remaining Convertible Securities.

The Convertible Securities will (subject to the satisfaction of certain conditions) be convertible into ordinary shares of the Company (the “Shares”), in whole or in part, at the option of Bergen. The Company will make an announcement each time any Convertible Securities are converted in whole or in part and will specify in such announcement the relevant conversion price, which will be the lower of (a) 92.5% of the average of five daily volume-weighted average prices of the Shares on AIM during a specified period preceding the relevant conversion and (b) 140% of the average of the daily volume-weighted average prices of the Shares for the 20 consecutive trading days preceding the date of execution of the Agreement.

The Investor has agreed to certain, substantial, limitations on its ability to dispose of the Shares following a conversion of the Convertible Securities. Additionally, the Investor has agreed to substantial limitations on its ability to convert the Convertible Securities, including a limit on how much of the Convertible Securities can be converted in a particular time period. Further, the Investor does not, and has agreed not to, and to cause its affiliates not to, short-sell the Company’s Shares.

In connection with the Agreement:

(A)      the Company has issued to Bergen 4,388,912 Shares by way of a commencement fee in relation to the overall funding. The Company has applied for admission of these Shares to trading on AIM, and this is expected to become effective on or about 22 September 2014;
(B)      the Company has issued to Bergen 10,600,000 Shares. The Company has applied for admission of these Shares to trading on AIM, and this is expected to become effective on or about 22 September 2014. Bergen may be required to make a further payment to the Company once all of the obligations of the Company under the Deed have been finally met and no amount remains outstanding to Bergen, depending on the price of Shares at such time; and
(C)      the Company has agreed that it will issue 9,800,000 warrants with an exercise period of 36 months from the date of issue (the “Warrants”) to Bergen entitling Bergen (or any subsequent holder of the Warrants) to subscribe for one Share per Warrant at the exercise price equal to 140% of the average of the daily volume-weighted average prices of the Shares during the 20 trading days prior to the date of execution of the Deed.

The Convertible Securities will only be issued to the extent that the Company has corporate authority to do so.

The proceeds for the issue of the Shares and the Convertible Securities will be used by the Company for general working capital purposes.

Admission to AIM

Application has been made to the London Stock Exchange for the 14,988,912 new ordinary shares to be admitted to trading on AIM. Dealings are expected to commence on or about 22 September 2014 (“Admission”).  Following this Admission the Company will have 439,046,986 Shares in issue with each Share carrying the right to one vote. There are no Shares currently held in treasury. The total number of voting rights in the Company is therefore 439,046,986and this figure may be used by shareholders as the denominator for the calculations by which they determine if they are required to notify their interest in, or a change to their interest in, the Company under the Disclosure Rules and Transparency Rules published by the United Kingdom Listing Authority.

About Mariana Resources

Mariana Resources Ltd is an AIM quoted exploration and development company with an extensive portfolio of gold, silver and copper projects in South America. In Peru, Mariana has an option to earn a 51% interest in highly prospective copper-gold and copper silver porphyry targets in the Cordillera del Condor of northern Peru as well as an option to earn a 70% interest in the Soledad copper-gold and silver project in Central Peru. In southern Argentina, the Company’s core gold-silver projects are Las Calandrias (100%), Sierra Blanca (100%), Los Cisnes (100%), Bozal (100%) and Los Amigos JV (30%). These projects are part of a 200,000+ Ha land package in the Deseado Massif epithermal gold-silver district in mining-friendly Santa Cruz Province.