Denarius Metals Announces Consent from Holders to Amend Terms of Its Convertible Unsecured Debentures

Rhea-AI Summary

Denarius Metals (DNRSF) has secured consent from debenture holders to amend terms of its convertible unsecured debentures. The company received approval from 93.6% of 2023 Debenture holders (CA$19.52M outstanding) and 97.1% of 2024 Debenture holders (CA$14.03M outstanding). Key amendments include allowing share issuance instead of cash for monthly interest payments from June 2025 to May 2026, implementing a US$4,000/oz cap on gold price for Gold Premium Payment calculations, and enabling share-based settlement of Gold Premium Payments for specific dates in 2026. Consenting holders will receive a 2% fee in additional debentures, resulting in 638,014 new consent fee debentures, with company executives receiving 171,523 of these. The amendments await final Cboe Canada approval, expected effective June 18, 2025.

Positive

• High consent rate achieved (93.6% and 97.1%) indicates strong debenture holder support
• Amendments provide financial flexibility by allowing share-based payments instead of cash
• US$4,000/oz gold price cap limits company's potential premium payment obligations

Negative

• Potential dilution from share issuance for interest payments and Gold Premium Payments
• Company's move to share-based payments suggests possible cash flow constraints
• Additional dilution from consent fee debentures issuance

Toronto, Ontario--(Newsfile Corp. - June 17, 2025) - Denarius Metals Corp. (Cboe CA: DMET) (OTCQX: DNRSF) ("Denarius Metals" or the "Company") announced today that it has received the required consents from holders to approve certain amendments (the "Amendments") to the trust indentures for its convertible unsecured debentures. The Company has an aggregate principal amount of CA$19,521,000 of convertible unsecured debentures (the "2023 Debentures") issued and outstanding under a trust indenture dated October 19, 2023, as amended and supplemented on October 31, 2023 and December 31, 2024 (together, the "2023 Indenture") and an aggregate principal amount of CA$14,030,460 of convertible unsecured debentures (the "2024 Debentures") issued and outstanding under a trust indenture dated May 30, 2024, as amended and supplemented on June 25, 2024 and December 31, 2024 (together, the " 2024 Indenture").

Holders representing 93.6% and 97.1% of the total outstanding principal amount of 2023 Debentures and 2024 Debentures, respectively, consented to the Amendments to the 2023 Indenture and the 2024 Indenture which include:

2023 Indenture:

• enabling the Company to issue common shares rather than using cash to settle the monthly interest payments on the debentures from June 30, 2025 to May 31, 2026, inclusive;
• enabling the Company to issue common shares rather than using cash to settle the Gold Premium Payments, if any, payable on each of January 31, 2026 and April 30, 2026; and
• implementing a maximum amount of US$4,000 per ounce for the London P.M. Fix price of gold used in the Gold Premium Payment (as defined in the 2023 Indenture) calculation.

2024 Indenture:

• enabling the Company to issue common shares rather than using cash to settle the monthly interest payments on the debentures from June 30, 2025 to May 31, 2026, inclusive; and
• implementing a maximum amount of US$4,000 per ounce for the London P.M. Fix price of gold used in the Gold Premium Payment (as defined in the 2024 Indenture) calculation.

To make the Amendments, the Company required the written consent of the holders of at least 66 2/3% of the total outstanding principal amount of each of the 2023 Debentures and the 2024 Debentures. The Amendments are subject to the final approval of Cboe Canada and are expected to become effective on or about June 18, 2025.

Holders of the debentures who responded to the solicitation and consented to the Amendments will receive a consent fee on or about June 18, 2025 equal to two percent (2%) of the number of debentures they hold. Consent fees will be satisfied through the issuance of additional debentures, denominated in a principal amount of CA$1.00 per debenture, to the consenting holders and will not be paid in cash. Based on the consents received, the Company will issue a total of 365,560 consent fee debentures to holders of the 2023 Debentures and 272,454 consent fee debentures to holders of the 2024 Debentures. Pursuant to the consent solicitation process, Mr. Serafino Iacono (Executive Chairman), Mr. Federico Restrepo-Solano (Director and CEO), Mr. Michael Davies (Chief Financial Officer) and Ms. Amanda Fullerton (General Counsel and Secretary) will receive an aggregate of 171,523 consent fee debentures. All debentures issued as a consent fee will be subject to a statutory four month hold period.

About Denarius Metals

Denarius Metals is a Canadian junior company engaged in the acquisition, exploration, development and eventual operation of precious metals and polymetallic mining projects in high-grade districts in Colombia and Spain. Denarius Metals is listed on Cboe Canada where it trades under the symbol "DMET". The Company also trades on the OTCQX Market in the United States under the symbol "DNRSF".

In Colombia, Denarius Metals recently commenced mining operations at its 100%-owned Zancudo Project, a high-grade gold-silver deposit, which includes the historic producing Independencia mine, located in the Cauca Belt, about 30 km southwest of Medellin.

In Spain, Denarius Metals has interests in three projects focused on in-demand critical minerals. The Company owns a 21% interest in Rio Narcea Recursos, S.L. and is the operator of its Aguablanca Project, which has recently been recognized by the EU as a Strategic Project. The Aguablanca Project comprises a turnkey 5,000 tonnes per day processing plant and the rights to exploit the historic producing Aguablanca nickel-copper mine, located in Monesterio, Extremadura. Denarius Metals also owns a 100% interest in the Lomero Project, a polymetallic deposit located on the Spanish side of the prolific copper rich Iberian Pyrite Belt, approximately 88 km southwest of the Aguablanca Project, and a 100% interest in the Toral Project, a high-grade zinc-lead-silver deposit located in the Leon Province, Northern Spain.

Additional information on Denarius Metals can be found on its website at www.denariusmetals.com and by reviewing its profile on SEDAR+ at www.sedarplus.ca.

Cautionary Statement on Forward-Looking Information

This news release contains "forward-looking information", which may include, but is not limited to, statements with respect to anticipated business plans or strategies, including Cboe Canada final approval, finalization of the consent solicitation process, amendments to the 2023 Indenture and 2024 Indenture and issuance of debentures as a consent fee. Often, but not always, forward-looking statements can be identified by the use of words such as "plans", "expects", "is expected", "budget", "scheduled", "estimates", "forecasts", "intends", "anticipates", or "believes" or variations (including negative variations) of such words and phrases, or state that certain actions, events or results "may", "could", "would", "might" or "will" be taken, occur or be achieved. Forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of Denarius Metals to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements. Factors that could cause actual results to differ materially from those anticipated in these forward-looking statements are described under the caption "Risk Factors" in the Company's Annual Information Form dated April 25, 2024 which is available for view on SEDAR+ at www.sedarplus.ca. Forward-looking statements contained herein are made as of the date of this press release and Denarius Metals disclaims, other than as required by law, any obligation to update any forward-looking statements whether as a result of new information, results, future events, circumstances, or if management's estimates or opinions should change, or otherwise. There can be no assurance that forward-looking statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, the reader is cautioned not to place undue reliance on forward-looking statements.

For Further Information, Contact:

Michael Davies
Chief Financial Officer
(416) 360-4653
investors@denariusmetals.com

To view the source version of this press release, please visit https://www.newsfilecorp.com/release/255911

FAQ

What changes did Denarius Metals (DNRSF) make to its convertible debentures?

Denarius Metals amended its debentures to allow share-based interest payments instead of cash from June 2025 to May 2026, implemented a US$4,000/oz gold price cap for premium payments, and enabled share-based settlement of Gold Premium Payments for early 2026.

How much are Denarius Metals' (DNRSF) outstanding convertible debentures worth?

Denarius Metals has CA$19.52 million in 2023 Debentures and CA$14.03 million in 2024 Debentures outstanding.

What percentage of DNRSF debenture holders approved the amendments?

93.6% of 2023 Debenture holders and 97.1% of 2024 Debenture holders approved the amendments, exceeding the required 66 2/3% threshold.

How will DNRSF compensate debenture holders who consented to the amendments?

Consenting holders will receive a 2% fee in additional debentures, with 365,560 new debentures for 2023 holders and 272,454 for 2024 holders, totaling 638,014 consent fee debentures.

When will the DNRSF debenture amendments take effect?

The amendments are expected to become effective on June 18, 2025, subject to final approval from Cboe Canada.