Timminco Completes First Tranche of Equity Financing

2010-05-19

Timminco recently announced that it has completed the first of three tranches of its private placement equity offering, which is expected to generate total gross proceeds of approximately $13 million. The first tranche of approximately 7.1 million common shares was issued at a price of $0.65 per share for gross proceeds of $4.6 million. All of the common shares under this first tranche were issued to AMG Advanced Metallurgical Group N.V. As a result, AMG now owns approximately 74.9 million common shares of Timminco, representing 41.0% of Timminco's total issued and outstanding shares.

Timminco expects to complete the second tranche of the equity financing of approximately 8.8 million common shares at the same price per share, for additional gross proceeds of $5.8 million, on or about May 21, 2010. AMG will acquire approximately 4.2 million additional common shares with the remaining common shares issued to other investors. In addition, AMG has subscribed for the third tranche of the financing of approximately 4.1 million additional common shares at the same price per share, for additional gross proceeds of approximately $2.6 million, which is expected to be completed on June 14, 2010. Upon completion, AMG's ownership will increase to approximately 42.3%.

The net proceeds of the offering will be paid to the Company's senior secured lender to reduce the outstanding balance under the Company's revolving credit facility with Bank of America, NA. The amount repaid under such facility may be reborrowed and used for general corporate purposes, subject to an additional borrowing base reserve of $1.0 million and to continued compliance with, and availability under, the facility.