Champion Iron Completes Sale of $10 Million Convertible Debenture
Champion Iron Completes Sale of $10 Million Convertible Debenture
Montréal (Québec), Canada, June 1 , 2017 : Champion Iron Limited (ASX: CIA, TSX: CIA)
(“Champion” or the “Company”), is pleased to announce that it has completed the previously
announced non -brokered sale of a $10 million unsecured subordinated convertible debenture
(the “Debenture”) to Altius Minerals Corporation (“Altius”). The sale of the Debenture is a
component of a CDN$40 million debt and equity bridge financing which Champion arranged for its
subsidiary Quebec Iron Ore Inc. (“QIO”), in connection with the restart of operations at QIO’s Bloom
Lake Iron Mine (“Bloom Lake”), located near Fermont, Quebec. Details of th e bridge financing were
previously disclosed by Champion on May 18, 2017.
The Debenture is convertible at the option of Altius at any time into Champion Ordinary Shares
(“Shares”) at a conversion price of $1.00 per Share. Should Champion and QIO not comple te a
master financing (“Master Financing”) of a minimum of $212 million to finance certain Bloom Lake
capital expenditures by November 30, 2017, then the conversion price will be adjusted to the lesser
of $1.00 or to the five-day weighted average trading price of the Shares on the TSX determined as of
the date of conversion. The maximum number of Shares that may be issued upon conversion of the
Debenture is 50,000,000 with the balance of the unconverted principal amount of the Debenture, if
any, to be repaid in cash or converted into a proportion of the Royalty (as defined hereinafter) at the
option of the Company. If the principal amount is not repaid in full on or before the second
anniversary of the Debenture, Altius will have the right to convert the ent ire outstanding principal
amount into a 0.21% gross overriding royalty on the Bloom Lake project (the “Royalty”).
The Debenture has a term to maturity of 12 months and will bear interest at a rate of 8% payable
quarterly. Following completion of the Master Financing, the principal amount of the Debenture
may be prepaid in whole or in part by the Company subject to a minimum payment representing 6
months of interest.
The Debenture and the S hares that may be issued upon its conversion are subject to a statut ory
resale restriction until October 2, 2017.
About Bloom Lake
On April 11, 2016, the Company, through its subsidiary QIO, acquired the Bloom Lake assets from
affiliates of Cliffs Natural Resources Inc. that were subject to restructuring proceedings under the
Companies’ Creditors Arrangement Act (Canada). Québec Iron Ore Inc. is 63.2% owned by the
Company, with the remaining 36.8% equity interest owned by Ressources Québec, acting as a
mandatory of the Government of Quebec.
The Bloom Lake property is located on the south end of the Labrador Trough, approximately 13 km
north of Fermont, Quebec, and 10 km north of the Mount -Wright iron ore mining operation of
ArcelorMittal Mines Canada. The Bloom Lake Mine is an open pit truck and shovel operation, with a
concentrator. From the site, iron concentrate can be transported b y rail, initially on the Bloom Lake
Railway, to a ship loading port in Sept-Iles, Québec.
The Bloom Lake Mine has already been authorized for operation under the federal and provincial
environmental authorities. The project was subject to an environmenta l impact assessment process
under Section 31.1 of the Québec Environment Quality Act , which led to the first decree issued by
the Quebec government in 2008 authorizing mining activities at the Bloom Lake site . An updated
positive Feasibility Study on Bloom Lake has been completed and is available under the Company’s
profile on SEDAR (www.sedar.com).
About Champion
Champion is an iron development and exploration company, focused on developing its significant
iron resources in the south end of the Labrador Trough in the province of Québec. Following the
acquisition of its flagship asset, the Bloom Lake iron ore property, the Company’s main focus is to
implement upgrades to the mine and processing infrastructure it now owns while also advancing
projects associated with improving access to glo bal iron markets, including rail and port
infrastructure initiatives with government and other key industry and community stakeholders.
Champion’s management team includes professionals with mine development and operations
expertise who also have vast experience from geotechnical work to green field development, brown
field management including logistics development and financing of all stages in the mining industry.
For further information please contact:
Michael O’Keeffe, Executive Chairman and CEO at Tel. +1 514-316-4858
David Cataford, COO at Tel. +1 514-316-4858
For additional information on Champion Iron Limited, please visit our website at www.championiron.com
This news release includes certain information that may constitute "forward -looking inform ation" under
applicable Canadian securities legislation. All statements, other than statements of historical facts, included in
this news release that address future activities, events, developments or financial performance constitute
forward-looking infor mation. The use of any of the words "will", "expect", “anticipate”, “intend”, "believe",
"plan", "potential", “outlook”, “forecast”, “estimate” and similar expressions are intended to identify forward -
looking information. Forward -looking information is nec essarily based upon a number of estimates and
assumptions that, while considered reasonable, are subject to known and unknown risks, uncertainties, and
other factors which may cause the actual results and future events to differ materially from those expre ssed or
implied by such forward -looking information, including the risks identified in Champion’s annual information
form, management’s discussion and analysis and other securities regulatory filings made by Champion on
SEDAR (including under the heading " Risk Factors" therein). There can be no assurance that such information
will prove to be accurate, as actual results and future events could differ materially from those anticipated in
such forward -looking information. Accordingly, readers should not place undue reliance on forward -looking
information. All of Champion’s forward -looking information contained in this press release is given as of the
date hereof and is based upon the opinions and estimates of Champion’s management and information
available to management as at the date hereof. Champion disclaims any intention or obligation to update or
revise any of its forward -looking information, whether as a result of new information, future events or
otherwise, except as required by law.