OMEX Inks Strategic Financing Deal with MINOSA

Odyssey Marine Exploration (OMEX) has signed a strategic financing agreement with Minera del Norte S.A. de c.v. (MINOSA) to facilitate Odyssey’s offshore mineral and resource exploration.

Under the agreement, MINOSA will extend short-term, debt financing to Odyssey of up to $14.75 million. In addition, Penelope Mining LLC, a wholly-owned subsidiary of MINOSA, has agreed to invest up to $101 million over three years in convertible preferred stock of Odyssey. The debt and the equity financings are subject to the satisfaction of certain conditions including those described below under “Financing Terms.”

Mark Gordon, President and CEO of Odyssey, commented: “The debt financing will enable us to continue our ongoing operations, and the equity financing will help position us to dramatically advance our business of locating and recovering assets on the sea floor and to enhance our potential to deliver substantial value to stockholders.”

Odyssey Chairman, Greg Stemm, added: “We are looking forward to working with the MINOSA team as we build the growth potential of Odyssey. During the time that we have been working on this transaction, we have come to gain great respect for the depth of expertise and resources available through their team.”

The financing transaction includes both an initial loan from MINOSA to a wholly-owned subsidiary of Odyssey and a stock purchase agreement between Odyssey and Penelope Mining.

The up to $14.75 million of loans to Odyssey will be at 8% interest and will be secured by a pledge of Odyssey’s interest in a subsidiary that owns seafloor mining rights. Upon the initial sale of the AA-1 Preferred Stock, Odyssey will use a portion of the net proceeds to repay this indebtedness. If Odyssey shareholders do not approve the equity transaction, the loans will mature on September 30, 2015, unless extended in certain circumstances to March 31, 2016. In addition, MINOSA will receive a call option to purchase a controlling interest in the subsidiary for $40 million, which MINOSA may not exercise once the equity closing occurs, so long as the conditions to the continued equity financing are satisfied.

Upon closing of the equity transaction, Penelope Mining will purchase $35 million of Odyssey’s newly issued Series AA-1 Convertible preferred stock priced at $1.00 per share.

After the initial closing and subject to the satisfaction of certain conditions to continued funding, Penelope Mining will be obligated to purchase additional shares of Series AA-1 convertible preferred stock at a price of $1.00 per share, between March 2016 and March 2018.

Upon completion of such purchases, Penelope Mining will own a majority of the outstanding voting power of Odyssey. In addition, Penelope Mining will have the right to accelerate its purchase of Series AA-1 Convertible Preferred Stock, and if Odyssey common stock trades above $1.26 per share for a minimum of 20 consecutive days, Penelope Mining will have the right to purchase a specified number of shares of Series AA-2 Convertible Preferred Stock priced at $0.50 per share designed to provide Penelope Mining with ownership of 65% of the fully-diluted voting power in Odyssey.