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ADW
ADW
ADW - African Dawn Capital Limited - Funding update and further cautionary
announcement
AFRICAN DAWN CAPITAL LIMITED
(Incorporated in the Republic of South Africa)
(Registration number 1998/020520/06)
JSE code: ADW
ISIN: ZAE000060703
("Afdawn" or "the company")
FUNDING UPDATE AND FURTHER CAUTIONARY ANNOUNCEMENT
The board is pleased to advise shareholders that agreement in principle has been
reached with the National Housing Corporation Limited ("NHFC") on the resolution
of the long standing issue regarding the R36 million facilities provided to
Afdawn and its subsidiary, Nexus Personnel Finance (Pty) Limited and for which
Afdawn had stood as surety and which is in default. In terms of the agreement,
the NHFC is prepared to accept a R10 million preference share issued by Elite
Group (Pty) Limited, Afdawn`s microfinance subsidiary, and which has other
performing facilities with the NHFC, and a cash settlement of R20 million in
full and final settlement of the R36 million facility. Additionally, the
security issued by Afdawn in respect of the facilities will be cancelled ("the
agreement").
The agreement removes the material uncertainty included in the Directors Report
regarding the Going Concern principle and which resulted in the inclusion of a
Matter of Emphasis statement in Afdawns`s audit report. The agreement also
allows the directors to proceed with the raising of additional capital without a
material uncertainty facing the company. Additional financing will have to
accommodate the needs of the business in respect of future growth as well as the
cash portion of the agreement. Further details on the Board`s plans in this
regard will be issued shortly.
Shareholders are cautioned that legal agreements outlining the definitive terms
of the agreement are yet to be drafted. However, the board has had good
negotiations with the NHFC who have been extremely co-operative in these
discussions and the board does not expect any material deviation to the above
draft terms. Shareholders will be advised once legal agreements have been
signed.
FURTHER CATIONARY ANNOUNCEMENT
Shareholders are referred to the cautionary announcements, the last of which was
dated 9 November 2010, and are advised that discussions are ongoing with
potential liquidity providers.
Shareholders are therefore advised to continue exercising caution when dealing
in the company`s securities until a further announcement is made in regard to
this matter.
Johannesburg
17 November 2010
Designated Advisor
Sasfin Capital
(A division of Sasfin Bank Limited)
Date: 17/11/2010 10:15:01 Produced by the JSE SENS Department.
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