| Fri 17 Dec 2010, 14:14 | | BAU - Bauba Platinum Limited - Announcement pertaining to the Voluntary Trading |
|
BAU
BAU
BAU - Bauba Platinum Limited - Announcement pertaining to the Voluntary Trading
Halt, the lifting thereof, a Proposed Rights Offer and a Cautionary Announcement
BAUBA PLATINUM LIMITED
(Formerly Absolute Holdings Limited)
(Incorporated in the Republic of South Africa)
(Registration number 1986/004649/06)
Share code: BAU ISIN No: ZAE000145686
("Bauba Platinum" or "the Company")
ANNOUNCEMENT PERTAINING TO THE VOLUNTARY TRADING HALT, THE LIFTING THEREOF
A PROPOSED RIGHTS OFFER AND A CAUTIONARY ANNOUNCEMENT
1. INTRODUCTION
Shareholders of Bauba Platinum ("Shareholders") are referred to the announcement
dated 21 July 2010 ("Listing Announcement"), regarding the conclusion and
implementation of the acquisition of the various platinum interests ("Platinum
Assets"), as more fully described in the circular to shareholders dated 17 May
2010 ("Circular"), which Platinum Assets comprise Bauba Platinum`s main asset
("Reverse Listing") and the announcement dated 15 December 2010 ("Trading Halt
Announcement") regarding the voluntary trading halt placed over Bauba Platinum`s
securities at the request of Bauba Platinum`s board of directors ("Board").
The Platinum Assets were acquired from the shareholders of, inter alia, Ndarama
Mineral Resources (Pty) Ltd and Bauba A Hlabirwa Mining Investments (Pty) Ltd
("Vendors").
2. NOTIFICATION RECEIVED FROM VENDORS
Shareholders are hereby informed that Bauba Platinum received a written notice
on 15 December 2010 ("Notification"), issued on behalf of the Vendors, claiming
that:
- the Reverse Listing did not become unconditional as a consequence of a
suspensive condition not having been fulfilled within the stipulated period
pertaining thereto; and
- the Platinum Assets are therefore not owned by the Company,
("Dispute").
In terms of the Dispute, the Vendors claim and have provided the Company with
prima facie information to the effect that the Company, allegedly represented by
a senior employee ("Senior Employee"), had entered into a side letter to the
main transaction agreements (as referred to in the Circular) ("Agreements"), in
terms of which side letter the Company purportedly agreed that a minimum amount
of R24 815 590 of new capital ("Subscription Amount") had to be raised and
received by the Company prior to the implementation of the Reverse Listing
("Side Letter").
Prior to entering into the Side Letter (if it is effective), the position was
that the Company had to (and accordingly the Company in fact did) raise a
minimum of R15 million of new capital, and only had to demonstrate this (which
in fact the Company did demonstrate) by means of irrevocable undertakings, as
opposed to having received the actual subscription proceeds, in order to satisfy
the condition precedent pertaining to the minimum capitalisation of the Company
("Original Condition").
Notwithstanding the Original Condition (and whether or not same was fulfilled),
the Vendors had to approve the Reverse Listing, as a condition precedent to the
Agreements ("Vendor Approval").
In the Notification, the Vendors stated that they provided Vendor Approval on
the basis of the Subscription Amount and on condition that these funds had to be
actually received, as set out in the Side Letter, and not on the basis of (and
regardless of the fulfilment of) the Original Condition.
At the time of the Listing Announcement, the Company had received irrevocable
undertakings to subscribe for new shares in the Company in an amount equal to
the Subscription Amount ("Irrevocable Undertakings"). It appears as if the
Reverse Listing was then implemented by the Company, on a basis consistent with
the Original Condition but inconsistent with the specific terms contained in the
Side Letter, i.e. prior to the actual receipt of the Subscription Amount. As
such, shares in Bauba Platinum were issued to the Vendors and thereafter listed
on the main board of the JSE Limited ("JSE") upon the basis of the fulfilment of
the Original Condition and not on the basis of the Side Letter. The Vendors
allege that such implementation therefore occurred contrary to the basis upon
which Vendor Approval was provided.
Subsequent to the implementation by the Company of the Reverse Listing, a
subscriber subscribing for an amount of approximately R7.2 million, which amount
formed part of the Irrevocable Undertakings, reneged on such undertaking and
this amount was therefore not received by the Company, either prior to the date
of lapsing of the condition set out in the Side Letter, or thereafter. The
Company therefore raised R7.2 million of capital less than the amount stipulated
in the Side Letter ("Subscription Deficit").
The current Board, other than the Senior Employee, had no knowledge of the
existence of the Side Letter and, therefore, of the potential consequences of
the Side Letter.
The corporate advisors to the Reverse Listing, Qinisele Resources (Proprietary)
Limited ("Qinisele Resources"), stated in writing that Qinisele Resources were
also not aware of the Side Letter.
As such, the Board of Bauba Platinum and Qinisele Resources (Proprietary)
Limited, the corporate advisors to the Reverse Listing, only became aware of the
existence of the Side Letter, its terms and implications upon having been
informed thereof by the Vendors.
The Board provides the information set out in this announcement to Shareholders
on a "without prejudice" basis to the rights of the Company, which rights remain
strictly reserved, in the interests of full disclosure to Shareholders and this
announcement furthermore does not constitute an acceptance or admission of the
allegations by the Vendors set out in the Notification.
3. PROPOSED RE-INSTATEMENT OF THE AGREEMENTS
In terms of the Notification, the Vendors indicated that they would allow Bauba
Platinum the opportunity to fulfil the Subscription Deficit, by 31 January 2011
or such later date as the Vendors and the Company may agree to, in order to
allow the Company and the Vendors to reinstate the Agreements (if and to the
extent that such reinstatement is required).
Subsequent to receipt of the Notification, the Vendors and Bauba Platinum have
in principle agreed to an amicable course of action whereby the Vendors will
agree to reinstate the Agreements subject to certain terms and conditions, as
more fully set out below:
- Bauba Platinum will secure new equity subscriptions, in an amount of R7.5
million ("New Subscription Amount"), at an issue price of R2.25 per new
Bauba Platinum share ("New Issue").
- The New Issue will be implemented immediately upon the Vendors and Bauba
Platinum agreeing to reinstate the Agreements in writing and such re-
instatement agreements ("Reinstatement Agreements") becoming unconditional
(save for any condition relating to the implementation of the New Issue).
- The cash pertaining to the New Issue will be held in trust until such time
as the Reinstatement Agreements become unconditional.
- The New Issue will be conditional upon receipt of the necessary regulatory
and shareholder approvals required.
The Company has received written confirmation from the subscribers to the New
Issue that the New Subscription Amount has been deposited into a trust account
at the Company`s attorneys, Cliffe Dekker Hofmeyr Inc.
The Company and the Vendors will use their reasonable commercial endeavours to
finalise, enter into and implement the Re-instatement Agreements during the
course of January 2011.
The Company and the Vendors have entered into a written and binding memorandum
of understanding on 17 December 2010 confirming the above.
The Vendors confirmed in writing to Bauba Platinum that they have not traded in
any of the vendor consideration shares received from Bauba Platinum.
4. PROPOSED RIGHTS OFFER
The Board intends providing all Shareholders with an opportunity to maintain
their pro rata shareholding in Bauba Platinum by subscribing, at the same price
and on the same terms and conditions that the New Issue will take place, for new
shares to be issued in terms of a proposed rights offer, which may be
implemented by means of a claw back offer ("Rights Offer").
The terms and conditions pertaining to the proposed Rights Offer will be
announced upon finalisation and execution of the Reinstatement Agreements.
5. LIFTING OF VOLUNTARY TRADING HALT
In light of the above, the Board has requested the JSE to lift the voluntary
trading halt, as described in the Trading Halt Announcement, under which the
Company`s securities are currently held. Accordingly, trade in Bauba Platinum
securities on the exchange operated by the JSE will recommence with immediate
effect.
6. CAUTIONARY ANNOUNCEMENT
Until such time as the Company is in a position to provide further details
regarding the New Issue, the Reinstatement Agreements and the proposed Rights
Offer, Shareholders are advised to exercise caution when dealing in the
Company`s securities.
Johannesburg
17 December 2010
Sponsor
One Capital
Attorneys
Cliffe Dekker Hofmeyr Inc
Date: 17/12/2010 14:14:45 Produced by the JSE SENS Department.
The SENS service is an information dissemination service administered by the
JSE Limited (`JSE`). The JSE does not, whether expressly, tacitly or
implicitly, represent, warrant or in any way guarantee the truth, accuracy or
completeness of the information published on SENS. The JSE, their officers,
employees and agents accept no liability for (or in respect of) any direct,
indirect, incidental or consequential loss or damage of any kind or nature,
howsoever arising, from the use of SENS or the use of, or reliance on,
information disseminated through SENS.
