Marengo Announces Proposed Financing with Its Major Shareholder

TORONTO, ONTARIO--(Marketwired - Oct. 13, 2015) - Marengo Mining Limited (TSX:MRN)(POMSoX:MMC) ("Marengo" or the "Company") is pleased to announce it has entered into an agreement (the "Letter Agreement") with its major shareholder, Sentient Executive GP IV, Limited, acting as the general partner of Sentient GP IV, L.P., itself acting as the general partner of Sentient Global Resources Fund IV, L.P. (collectively, "Sentient") in connection with the proposed issuance of US$14,000,000 principal amount of convertible unsecured debentures (the "Debentures"). In addition to the Company, its wholly-owned subsidiaries, Yandera Mining Company Limited and Marengo Mining (PNG) Limited (collectively, the "PNG Subsidiaries") have executed the Letter Agreement as guarantors of the Company's obligations under the Debentures. Sentient intends to subscribe for up to US$14 million in Debentures to be issued in two tranches, with the first tranche of US$7 million (the "First Tranche") to be completed following the approval of the Company's shareholders at the annual general and special meeting to be held on November 13, 2015, and the second tranche of US$7 million (the "Second Tranche") to be completed five months after shareholder approval is obtained. These transactions are also subject to approval by the Toronto Stock Exchange ("TSX").

Subject to obtaining the necessary shareholder approval, Marengo will be completing a share consolidation whereby for every 100 Marengo common shares, one post-consolidation Marengo common share will exist (the "Consolidation").

The Debentures will mature on December 31, 2017, (the "Maturity Date"); the Debentures will not bear interest. Each US$1,000 principal amount of Debentures will be convertible into common shares of the Company ("Common Shares") at a conversion price of C$0.45 per Common Share (the "Conversion Price") on a post-Consolidation basis, rounded up to the nearest Common Share. Each Debenture will be convertible, in whole or in part, at the option of Sentient and at any time, into Common Shares, intended to be freely tradable on the TSX, at the Conversion Price, for each US$1,000 principal amount of Debentures, subject to adjustment in certain circumstances as described below.