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Durban Roodepoort Deep, Limited - Option Agreement
Durban Roodepoort Deep, Limited
(Incorporated in the Republic of South Africa)
(Registration number 1895/000926/06)
(Share code: DUR)
(ISIN: ZAE000015079)
(ARBN number 086 277 616)
(NASDAQ Trading Symbol: DROOY)
("DRD" or "the company")
OPTION AGREEMENT
1. INTRODUCTION
DRD is pleased to announce that it has entered into an agreement with the
Investec Group ("Investec") which grants Investec an American call option
to acquire 10.2 million new, fully paid up DRD ordinary shares ("the
option")("the transaction").
2. TRANSACTION DESCRIPTION
The option has a strike price in US Dollars equal to 95.5% of the simple
average of the daily volume-weighted price of DRD American Depository
Receipts ("ADRs") trading on NASDAQ for the ten days prior to exercise
date. The option carries an expiration date of 15 March 2004.
3. RATIONALE FOR THE TRANSACTION
Should the option be exercised, DRD will apply the proceeds arising from
the exercise of the option towards its general corporate funding
requirements.
4. PRO FORMA FINANCIAL EFFECTS
To assist shareholders to assess the impact of the new issue of shares in
the event of exercise of the option, set out below are the pro forma
effects thereof on the earnings, headline earnings, net asset value and
tangible net asset value per DRD ordinary share. The material assumptions
are set out following the table. These pro forma financial effects do not
constitute a representation of the future financial position of DRD should
the option be exercised and have been disclosed in terms of the Listings
Requirements of the JSE Securities Exchange South Africa.
Before the After the
exercise of exercise of
the option the option Change
(cents) (cents) (%)
Earnings per share 202.3 195.5 (3)
Headline earnings per share 216.9 209.2 (4)
Net asset value per share 247.6 317.8 28
Tangible net asset value 247.6 317.8 28
per share
Notes:
1. The earnings and headline earnings per share in the "Before the exerci
the option" column of the table are based on the audited income statement
for the financial year ended 30 June 2003.
2. The earnings and headline earnings per share in the "After the exercis
the option" column of the table are based on 193 500 665 shares in issue,
the weighted average number of shares in issue for the year, and the assu
that:
- the option was exercised on 1 July 2002;
- the ten-day trade-weighted average price of DRD ADRs on NASDAQ at
equated to R15.86 per DRD ADR; and
- the cash raised on issue of DRD shares pursuant to the exercise o
option earned interest at a rate of 6.5%, which interest attracted S
normal tax at a rate of 30%.
3. The net asset value per share and tangible net asset value per share i
"Before the exercise of the option" column of the table are based on the
balance sheet of DRD at 30 June 2003.
4. The net asset value per share and tangible net asset value per share i
"After the exercise of the option" column of the table are based on 194 4
shares in issue and the assumptions that:
- the option was exercised on 30 June 2003; and
- the ten-day trade-weighted average price of DRD ADRs on NASDAQ at that date
equated to R15.86 per DRD ADR.
5. The pro forma financial effects have been prepared according to SA GAA
have not been audited.
Johannesburg
17 December 2003
Financial adviser
Questco Investments (Proprietary) Limited
(Registration number 2002/005616/07)
Sponsor
Standard Corporate and Merchant Bank
(A division of The Standard Bank of South Africa Limited)
(Registration number 1962/000738/06)
Date: 17/12/2003 01:16:03 PM Produced by the JSE SENS Department
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