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Mazal Mining & Exploration Limited - Recapitalisation And Restructure Of Mazal
Release Date: 06/12/2002 07:43:50 Code(s): MZL
Mazal Mining & Exploration Limited - Recapitalisation And Restructure Of Mazal
Mining And Exploration Limited
Mazal Mining & Exploration Limited
(Incorporated in the Republic of South Africa)
(Registration number 1998/013468/06)
Share code MZL ISIN ZAE000017711
("Mazal" or "the company")
RECAPITALISATION AND RESTRUCTURE OF MAZAL MINING AND EXPLORATION LIMITED
Introduction
Shareholders are advised that the negotiations to restructure the capital of
Mazal referred to in the announcement published on Wednesday, 2 October 2002,
have been concluded.
The transactions
Hopkinton Capital Limited, an investment company registered in the British
Virgin Isles ("Hopkinton") has agreed, subject to certain suspensive conditions
and shareholder approval, to invest R5 000 000 into the Company by subscribing
for 64 million new Mazal ordinary shares at 7,81 cents per share ("the new
shares").
In addition to the new share issue, and subject to shareholder approval, an
option has been written by the Company in favour of Hopkinton, entitling
Hopkinton to purchase a further 126 million shares, in the share capital of the
company, for the sum of R10 000 000, equivalent to 7,94 cents per share ("the
option"). This option may be exercised within two months of the conclusion of a
bankable feasibility document.
Shalom Nachom and Christopher Paul Dollery, have agreed subject to shareholder
approval to convert R7 200 000 of their loans into 0% preference shares of 5
cents each resulting in 144 million preference shares being issued ("the
preference shares"). The preference shares are at the option of the company
either redeemable or convertible into ordinary shares at an issue price per
ordinary share equal to the thirty day trade weighted average price per share at
which the ordinary shares of the company have traded on the JSE Securities
Exchange South Africa ("JSE") immediately preceding the conversion date. Further
loans of R8 400 000 in the names of Shalom Nachom and Christopher Paul Dollery
will, subject to shareholder approval be converted into 170 040 486 ordinary
shares at 4,94 cents per share ("loan shares").
Hopkinton, in addition to subscribing for the new shares, will purchase 84
million shares from Shalom Nachom and 14 million shares from Christopher Paul
Dollery for a total consideration of 1 cent ("the sale shares"). The sale shares
are all held directly with beneficial interest by both these shareholders.
After the new shares are issued, the loan shares are issued and sale shares are
purchased and assuming the option is exercised, Hopkinton will own 51,06% of the
issued share capital of the Company. Hopkinton held no shares prior to the
transactions.
Collectively these transactions will result in a change in control of Mazal. In
terms of the Securities Regulation Panel ("SRP") Code a mandatory offer to all
minority shareholders of Mazal is required. However the SRP has agreed to waive
this requirement in terms of, Rule 34 of the Code, as these transactions are
considered by the SRP to constitute a rescue operation. Accordingly, Hopkinton
will not be extending an offer to minority shareholders of Mazal.
Each of the transactions referred to above is conditional on the implementation
of the other transactions.
Rationale
The rationale for the transactions is to recapitalise the company so that it can
resume its mining activities and investigate new mining projects.
Voting Pool Agreements
Hopkinton, Itzhak Weltsman, Yossef Weltsman, Shmulik Weltsman, Shalom Nachom and
Christopher Paul Dollery have agreed to enter into a voting pool agreement to be
finalised within 30 days of the general meeting to approve the transactions.
Reconstitution of the board
Yossef Weltsman and Shmulik Weltsman have resigned from the Mazal board of
directors with effect from 25 October 2002. Hopkinton has appointed Dr John
Bristow, Theo Botoulas and David Levithan to the board as executive directors
with immediate effect. Shalom Nachom and Christopher Paul Dollery remain an
executive and non-executive director of the company respectively.
Change of Name
Mazal will, subject to shareholders approval, change its name to Diamond Core
Resources Limited.
Documentation
On or about Friday, 10 January 2003:
- A circular incorporating a notice of general meeting and including all
documentation relating to the JSE Listings Requirements and the SRP Code will be
posted to shareholders; and
- A detailed announcement including the salient dates and financial effects of
the transactions will be published on the JSE Securities Exchange News Service
and in the press on the following business day.
Lifting of suspension of trading in Mazal shares on the JSE
It is anticipated that, should the transactions be concluded successfully, the
suspension of the listing of Mazal will be lifted on the day following the
proposed general meeting.
Johannesburg
5 December 2002
Corporate advisor and Sponsor
Sasfin Bank Limited
(Registration number 1951/002280/06)
Attorneys
David Levithan
Accountants
Charles Orbach & Company
Chartered Accountants (SA) Registered Accountants & Auditors
Date: 06/12/2002 07:43:42 AM Produced by the JSE SENS Department
