| Wed 9 Feb 2011, 9:00 | | ZCI - ZCI Limited - Term loan agreement between ZCI and African Copper Plc |
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ZCI
ZCI
ZCI - ZCI Limited - Term loan agreement between ZCI and African Copper Plc
ZCI Limited
(Bermudian registration number 661:1969
(South African registration number 1970/000023/10)
JSE share code: ZCI ISIN: BMG9887P1068
Euronext share code: BMG9887P1068
("ZCI" or "the Company")
TERM LOAN AGREEMENT BETWEEN ZCI AND AFRICAN COPPER PLC ("ACU")
ZCI is pleased to announce that it has entered into a new term loan
facility agreement with ACU ("Term Loan Facility"). The purpose of the Term
Loan Facility is to provide ACU with general working capital and to allow
the AIM and Botswana-listed copper producer to accelerate mining activities
at the Thakadu deposit and to fund the investment in upgrading
infrastructure facilities at the Mowana Mine.
The Term Loan Facility is for a total amount of up to USD12.5 million and
will bear interest at a rate of 9.0% and is repayable in January 2014.
Interest will be payable semi-annually in arrears on 31 December and 30 June
each year commencing on 31 December 2011, with this payment including
accrued interest from the closing of the Term Loan Facility. The remaining
terms and conditions of the Term Loan Facility are on substantially similar
terms to the previous term loans from ZCI and brings total interest-bearing
loans from ZCI to USD54.1 million excluding the convertible loan of USD7.9
million. The Term Loan Facility contains typical covenants, warranties and
events of default for an agreement of this nature. The Term Loan Facility
has been guaranteed by ACU and all other ACU group companies.
In addition, ZCI announces that it has entered into an agreement with ACU to
exchange USD9.5 million that ZCI holds in current outstanding debt
assignment agreements for the issue of 169,318,230 new ordinary shares in
ACU at a price of 5.5782p per share ("the Debt Conversion"). The Debt
Conversion results from ZCI entering into debt assignment agreements with
certain of ACU`s large creditors, as part of the refinancing of ACU in May
2009.
The conversion price of 5.5782p per share was calculated based on the 30-day
Volume Weighted Average Price of ACU. Application will be made for the new
ACU ordinary shares to be admitted to trading on the AIM Market. The new
shares will rank pari passu with the existing ordinary shares in ACU and
trading of the new shares on AIM is expected to commence on 11 February
2011. The ordinary shares issued as consideration for the debt ("the
Consideration Shares") will be subject to trading restrictions. The vendor
is not permitted to dispose of any Consideration Shares prior to 3 months,
nor thereafter without the consent of ACU and its nominated adviser and
broker.
The total number of ACU shares in issue following this debt-to-equity
conversion is 992,737,730 and ZCI`s resulting aggregate holding of ordinary
shares is 845,888,730, representing approximately 85.21 per cent of the ACU,
an increase of approximately 3.05 per cent over the previous level.
Commenting,Tom Kamwendo, Chairman of ZCI Limited, said: "We continue to
regard African Copper as a good investment and our loans will help the
management team to build production and unlock value from the Mowana Mine
and the adjacent Thakadu-Makala deposits."
Commenting, Jordan Soko, Acting Chief Executive of African Copper Plc, said,
"The additional funds raised will allow the company to invest in the
infrastructure that our high quality assets deserve. The debt conversion
highlights the continuing support of ZCI for African Copper in its strategic
objectives to exploit these assets for the benefit of all shareholders."
Bermuda
9 February 2011
Sponsor: Bridge Capital Advisors (Pty) Limited
Date: 09/02/2011 09:00:14 Produced by the JSE SENS Department.
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