La Mancha Announces Acquisition of Shares of Horizonte Minerals PLC

LUXEMBOURG, Dec. 22, 2021 (GLOBE NEWSWIRE) -- La Mancha Investments S.à r.l. (“La Mancha”), a Luxembourg-incorporated private investment company focused on opportunities primarily in the precious metals and battery metals mining sector, is pleased to announce that it has completed a subscription for 759,128,764 ordinary shares (the “Ordinary Shares”) of Horizonte Minerals PLC (“Horizonte”) (London-AIM: HZM; TSX: HZM). The transaction was completed by way of private placement (the “Private Placement”) at a price of 7 pence per share (approximately C$0.12 per share using the daily average rate of exchange for GBP:CAD published by the Bank of Canada on December 21, 2021, being £1.00=C$1.7131), for aggregate gross proceeds of US$71,100,000 (approximately C$91,910,970 using the daily average rate of exchange for USD:CAD published by the Bank of Canada on December 21, 2021, being US$1.00=C$1.2927).

The Private Placement was completed pursuant to the terms of an investment agreement entered into with Horizonte on November 23, 2021 (the “Investment Agreement”). The Investment Agreement provides for La Mancha’s right to nominate one director to Horizonte’s Board of Directors, as well as certain anti-dilution and pre-emptive rights and governance rights. The Investment Agreement also contains a lock-in and standstill in relation to the Ordinary Shares whereby La Mancha has agreed (subject to certain customary exceptions) not to (i) dispose of any of its Ordinary Shares for a period of 4 months from the date of the Private Placement; and (ii) acquire any interests in Ordinary Shares, for a period of 18 months following the date of the Investment Agreement, which would cause La Mancha’s ownership interest in Horizonte to exceed 25% (on an undiluted basis).

In connection with the Investment Agreement, La Mancha also entered into a convertible note loan instrument on November 23, 2021, pursuant to which La Mancha agreed to purchase up to US$15,000,000 (approximately C$19,390,500 using the daily average rate of exchange for USD:CAD published by the Bank of Canada on December 21, 2021, being US$1.00=C$1.2927) principal amount convertible notes (the “Convertible Note”). The Convertible Note will be issued by Horizonte, subject to certain terms and conditions, prior to March 31, 2022 at a 5.75% discount (such that La Mancha shall only be required to pay 94.25% of the principal amount) at a fixed interest rate of 11.75% per annum, which shall be capitalised until the project completion of Horizonte’s Araguaia Project and payable in cash (subject to available cashflows) thereafter. In the case of an event of default in accordance with the terms of the Convertible Note, the interest rate is increased to 15.00% per annum. At any time until the maturity date (being the later of September 30, 2032 and 3 months after the final maturity date of Tranche A of Horizonte’s proposed US$346.2 million senior debt facility), La Mancha may, at its option, convert the Convertible Note, partially or wholly, into Ordinary Shares of Horizonte at a conversion price equal to 125% of 7 pence, being 8.75 pence per Ordinary Share (the “Conversion Price”), subject to customary anti-dilution rights.

Immediately prior to the completion of the Private Placement, La Mancha did not beneficially own, directly or indirectly, or exercise control or direction over any Ordinary Shares. Immediately following completion of the Private Placement, La Mancha became an insider of Horizonte, owning 759,128,764 Ordinary Shares representing approximately 19.96% of the issued and outstanding Ordinary Shares (on an undiluted basis).

Assuming the issuance of the Convertible Note in the aggregate principal amount of US$15,000,000 (approximately C$19,390,500 using the daily average rate of exchange for USD:CAD published by the Bank of Canada on December 21, 2021, being US$1.00=C$1.2927) as of the date hereof, the conversion thereof in full at the Conversion Price of 8.75 pence (approximately C$0.15 using the daily average rate of exchange for GBP:CAD published by the Bank of Canada on December 21, 2021, being £1.00=C$1.7131) and the accumulation of no interest, La Mancha would hold an additional 129,270,000 Ordinary Shares, and would beneficially own and have control and direction over an aggregate of 888,398,764 Ordinary Shares, representing approximately 22.6% of the outstanding Ordinary Shares (on a partially diluted basis).

La Mancha completed the Private Placement and agreed to acquire the Convertible Note for business and investment purposes. In the future La Mancha may, from time to time, increase or decrease its investment in Horizonte through market transactions, private agreements, treasury issuances, the conversion of the Convertible Note for Ordinary Shares or otherwise at any time subject to the terms of the Investment Agreement and other applicable restrictions.

La Mancha’s head office is located at 31-33 Avenue Pasteur L-2311 Luxembourg.

Horizonte’s head office is located at Rex House, 4 - 12 Regent Street, London, England, SW1Y 4RG.

La Mancha will file an early warning report in accordance with applicable securities laws, which will be available under Horizonte’s profile on the SEDAR website at www.sedar.com, and may also be obtained by contacting:

Karim Nasr
Chief Executive Officer of the La Mancha Group
T: +44 (0) 20 3960 2020
Email: contact@lamancha.com

ABOUT LA MANCHA

La Mancha is a Luxembourg based investment fund focusing on opportunities primarily in the precious metals mining sector across multiple geographies. La Mancha is a long-term investor that supports its investments with further capital and expertise to fund their growth and expansion plans. For more information, please visit www.lamancha.com.