TIDMBZM
RNS Number : 1284C
Bellzone Mining PLC
01 March 2011
4.36 p.m. - Tuesday 1 March 2011
Bellzone Mining plc
("Bellzone" or the "Company")
THE INFORMATION CONTAINED HEREIN IS RESTRICTED AND IS NOT FOR
PUBLICATION, RELEASE OR DISTRIBUTION, DIRECTLY OR INDIRECTLY, IN OR
INTO THE UNITED STATES, CANADA, AUSTRALIA, JAPAN, THE REPUBLIC OF
SOUTH AFRICA OR NEW ZEALAND OR ANY JURISDICTION IN WHICH SUCH
PUBLICATION RELEASE OR DISTRIBUTION WOULD BE UNLAWFUL
CIF strategic investment of approximately US$100 million and
proposed fundraising to raise up to a further US$100 million
Highlights:
-- China International Fund Limited ("CIF") agrees to invest
circa. US$100 million (GBP63.2 m million) in Bellzone by way of
private placement at 80 pence per share (the "CIF
Subscription")
-- Bellzone to raise up to an additional US$100 million through
a placing of new shares with institutional and other investors (the
"Institutional Placing")
-- Canaccord Genuity has underwritten US$50 million of the
Institutional Placing
-- Certain major shareholders and other investors have already
indicated their support for the Institutional Placing
-- Target 3-4 mtpa of production from Forecariah by Q1 2012
transforms Bellzone into near term producer
-- Placing ensures that Bellzone's contribution to Forecariah is
fully funded to production
-- Kalia development continues to provide medium term large
scale production expansion
-- Placing to fund Bellzone's share of the development of the
Forecariah iron ore project in conjunction with its joint venture
partner CIF and to advance certain aspects of its Kalia iron ore
project
Bellzone Mining plc (AIM: BZM), the iron ore and nickel/copper
company operating in West Africa, is pleased to announce that CIF
has today signed a definitive subscription agreement (the "CIF
Subscription Agreement") with Bellzone pursuant to which CIF has
agreed to subscribe for 79,000,000 ordinary shares ("Ordinary
Shares") in the capital of the Company ("CIF Shares") at 80 pence
per share to raise gross proceeds of GBP63.2 million (approximately
US$100m). In addition, Bellzone is to raise gross proceeds of up to
US$100 million through the issue of new ordinary shares (the
"Institutional Placing Shares") by way of the Institutional
Placingwith both new and existing institutional shareholders (the
"Institutional Placing Shares") which is being conducted, subject
to the satisfaction of certain conditions, through an accelerated
book-building process to be carried out by Canaccord Genuity
Limited ("Canaccord Genuity"), acting as lead manager and sole
bookrunner (the "Bookrunner") in relation to the Institutional
Placing. The identity of Placees and the basis of the allocations
are at the sole discretion of the Company and the Bookrunner. The
number of Institutional Placing Shares and the price at which the
Institutional Placing Shares are to be placed (the "Placing Price")
will be agreed by the Company with the Bookrunner at the close of
the book-building process. Details of the number of Institutional
Placing Shares and the Placing Price will be announced as soon as
practicable after the close of the book-building process. Canaccord
Genuity has agreed to underwrite US$50 million of the Institutional
Placing at the Placing Price. Renaissance Capital Limited
("Renaissance") is acting as joint broker.
CIF Subscription detail
On completion of the CIF Subscription Agreement, CIF will
acquire the CIF Shares for gross proceeds of GBP63.2 million
(approximately US$100m). The funds from the CIF Subscription,
together with the funds raised in the to be conducted Institutional
Placing, will be used to fully fund Bellzone's portion of the
planned capital expenditure of the Forecariah iron ore project in
conjunction with its joint venture partner CIF and to advance
certain aspects of its Kalia iron ore project.
The CIF Shares will be credited as fully paid and rank pari
passu with the existing issued Ordinary Shares when issued.
Subject to receipt of the subscription proceeds, the Company
will allot and issue the CIF Shares and apply for the CIF Shares to
be admitted to trading on the AIM market of the London Stock
Exchange ("AIM") and it is expected that admission of the CIF
Shares will take place and that trading will commence in such
shares at 8.00 a.m. on or about 7 March 2011.
Institutional Placing details
In addition to the CIF Subscription, Bellzone is undertaking an
Institutional Placing. Up to US$50 million in value (by reference
to the Placing Price) of the Institutional Placing Shares have been
underwritten by Canaccord Genuity with the balance of the
Institutional Placing Shares being placed by Canaccord Genuity and
Renaissance on a reasonable endeavours basis.
The allotment of the Institutional Placing Shares will be
conditional on, amongst other things, on the passing by
shareholders of resolutions at an Extraordinary General Meeting
("EGM") proposed to be held on or around 21 March 2011, granting
the Directors, inter alia, the authority necessary for the issue of
the Institutional Placing Shares. The Company will, in due course,
publish a circular to shareholders convening the EGM.
The books for the Institutional Placing will open with immediate
effect. The books are expected to close no later than 6:30 p.m.
(London) today. The timing of the closing of the books and the
making of allocations may be accelerated or delayed at Canaccord
Genuity's sole discretion. The Appendix to this announcement
contains the detailed terms and conditions of the Institutional
Placing.
By choosing to participate in the Institutional Placing and by
making an oral and legally binding offer to acquire Institutional
Placing Shares, investors will be deemed to have read and
understood this announcement in its entirety, including the
Appendix, and to be making such offer on the terms and subject to
the conditions contained herein and to be making the
representations, warranties, undertakings and acknowledgements
contained in the Appendix to this announcement.
The Institutional Placing Shares will be credited as fully paid
and rank pari passu with the existing issued Ordinary Shares when
issued.
The Company will, subject to approval of Shareholders at the
EGM, apply for admission of the Institutional Placing Shares to
trading on AIM and it is expected that admission of the
Institutional Placing Shares will take place and that trading will
commence in such shares on or about 22 March 2011 ("Admission") and
in any event no later than 30 April 2011.
Settlement of the Institutional Placing Shares is expected to
take place within the CREST system following each Admission.
Participation in the Institutional Placing will be limited to
institutional investors and certain other 'Qualifying Persons' as
defined in the Appendix to this announcement. Members of the
general public are not eligible to take part in the Institutional
Placing and may read it only for informational purposes.
The Appendix to this announcement contains the detailed terms
and conditions of the Institutional Placing.
Operational progress
Forecariah
Further to the Company's announcements in relation to Forecariah
on 31 January and 7 February 2011, Bellzone and CIF have agreed to
implement an accelerated programme to target a 10 million tonnes
per annum (mtpa) direct shipping ore ("DSO") iron ore operation,
targeting initial production in Q1 2012.
The following activities have already occurred or are currently
in progress:
-- Detailed agreement signed with CIF as announced on 2 August
2010
-- Company geological assessments in December 2010 and February
2011 completed
-- Multiple prospective oxide iron targets identified
-- Surface samples from Yomboyeli return grades of up to 60% Fe,
indicating DSO potential
-- Development budgets approved with CIF in January 2011
-- Bellzone appointed project manager of the Forecariah iron ore
joint venture
-- Road route and port location selected January 2011
-- Road feasibility study awarded January 2011
-- Port feasibility study awarded February 2011
-- Initial trenching and sampling at Santiguiyah has been
completed and samples sent to Perth for assay
-- Camp locations identified and camp sourced with construction
scheduled for March 2011
-- Detailed drilling plan for Yomboyeli completed, an initial
programme of 7,000 meters of RC drilling to commence in March
-- Preliminary flow-sheets options study underway
The following activities are planned up to Q1 2012:
-- Drilling programme
-- Preliminary mining and plant study
-- EIA and SEIA permitting for mine area
-- Complete feasibility study
-- Convention and concession award
-- Phase 1 resource classification
-- Mine and support infrastructure construction
-- Phase 2 resource classification
-- Production start - target January 2012
-- Road feasibility study
-- Protocl d'Accord award to secure transport rights
-- EIA and SEIA permitting
-- Road construction
-- Secure barges and support vessels
-- Port feasibility study
-- Construction of port and stockyards
-- Operational start - target February 2012
The development plan is focussed on defining and delivering
sufficient iron oxide ore from the identified targets to support an
initial production target rate of 3-4 mtpa of DSO in Q1 2012 which
will provide the Company with associated cash flow while ramping up
to the operations to a target rate of 10 mtpa by 2013. The
operation is expected to consist of simple drill, blast, load and
haul open pit mining, with product processing undertaken by modular
mobile crushing and screening plants. Power will be supplied to the
mine site by modular diesel generators and water will be drawn from
nearby rivers under the proposed environmental management plan.
Due to the proximity to the coast of the Forecariah deposits
(ranging from 40-80km), the costs of the associated infrastructure
are relatively low for an iron ore project. Initial production will
be transported to the port by 80t to 100t trucks. The Company will
construct approximately 80km of road of which 75km of existing
roads will be widened and upgraded- no bridges will be required.
The port will consist of stockpiling areas and simple static
conveyors for barge loading and the stockyards and conveyor
locations have already been located near the village of Konta.
Barges between 6,000t and 14,000t will be loaded at a sheet piled
wharf and will be taken down river and out to the trans-shipping
point by tugs. The bathometric survey contract has been awarded to
assess the dredging requirement and to demarcate the channel
required for the barge operation. The product will be loaded onto
bulk ore carriers by either a fixed trans-shipping barge or by self
loading Panamax style vessels. This temporary truck and trans-ship
operation in from the location of Konta will be temporary until the
main Kalia railway line and the Matakan port becomes operational in
2014. CIF has informed the Company that it could supply the tug
assisted barges which would reduce the required capital
expenditure.
The road and port are readily and economically upgradeable to
enable DSO product export and the Company estimates that total
capital required for an owner operated operation will be
approximately $300-350 million with Bellzone contributing 50%. The
CIF Subscription and the Institutional Placing together ensure that
Bellzone's contribution to Forecariah is fully funded to
production. Operating and capital expenditure trade-off studies are
underway to optimise expenditure through opportunities for contract
mining and processing, contract trucking and the leasing of
tugs.
A focused geological programme has been planned to define the
DSO potential at the Yomboyeli iron oxide target. In parallel with
the drilling programme, ongoing mapping, trenching and sampling
will be continued across the other target locations to further
define and identify drilling targets to support the expansion
plans. A remote sensing programme is planned to identify the
magnetite potential on the lease area, which will be followed by
targeted ground magnetic and a drilling campaign to define this
potential.
Current Company estimates have production costs on an owner
operated basis of $36/t pre 2014 and falling to $16/t post 2014.
The Company currently estimates the capital expenditure breakdown
at Forecariah to be as follows:
4mtpa 10mtpa Total
US$m US$m US$m
------- ------ ------- ------
Mine 60 58 118
------- ------ ------- ------
Road 53 50
------- ------ ------- ------
Port 175 175
------- ------ ------- ------
Total 288 58 346
------- ------ ------- ------
Kalia
Bellzone remains fully committed to the two stage development of
the 50 mtpa Kalia mine:
1. Stage I will provide 30mtpa production capacity with
production scheduled in 2014 of 20mtpa DSO and 10mtpa of magnetite
concentrate in 2015.
2. Stage II increases the DSO output to 30mtpa in 2017 and
doubles the concentrate capacity to 20mtpa in 2018.
The work at the 100% owned Bellzone Kalia mine continues on the
expansion and upgrade of the 3.74 billion tonne JORC compliant
magnetite resource already established over 6km of 19km of the
Kalia I strike. The definitive feasibility studies are in progress
with a number of engineering surveys underway. The SEIA and EIA
studies are on track for completion in Q1 2011, after which the
relevant approvals will be sought from the Government.
As per the definitive agreements signed with CIF and announced
on 2 August 2010, the Kalia infrastructure will be funded by CIF.
The Company will retain a carried interest in the infrastructure
holding company Kalia Horizon Minerals Pte Ltd. In addition to the
fully funded infrastructure CIF have committed to offer the Company
a finance package at market related terms for the development of
the Kalia mine.
As previously announced, Bellzone now has 670mt of measured and
indicated magnetite at 27.7 per cent. Fe and is undertaking an
infill drilling programme with an expected magnetite resource
upgrade in Q3 2011. Drilling at Kalia II commenced in February
2011. The Company also has an internally estimated 2.55bt potential
oxide resource at Kalia and its maiden oxide JORC resource
classification is due in early Q2 2011 and the initial test results
of the same are encouraging.
Bellzone has been making encouraging progress on the definitive
feasibility study ("DFS") at its Kalia project which is scheduled
for completion in Q4 2011:
-- SEIA and EIA studies scheduled for completion Q2 2011
-- Consultants - TWP and Ausenco engaged
-- Magnetite bulk sample completed - validates 68% Fe
concentrate
-- Mine engineering studies commenced with TWP
-- Process engineering commenced with Ausenco
-- Geotechnical studies commenced in Guinea
-- Hydrology and Hydrogeology studies awarded to Coffey
-- LiDAR survey commenced by Fugro
-- Rail and Port studies have now commenced with China Railway
Engineering Corporation and China Communications Construction
Company who have engineers in Guinea and have commenced on the
ground survey work
Other Projects
Bellzone has completed a mapping and surface sampling programme
identifying highly prospective targets at its Sadeka Nickel/Copper
Project. A drilling programme on the identified target areas
commenced in Q4 2010, with results expected in Q2 2011.
Bellzone has acquired the rights to buy 70% of Compagnie Miniere
de L'Ouest Africain SA, incorporated and holding tenements in Mali.
The company is undertaking geological studies on the tenements
which are prospective for iron ore before making an investment
decision.
Use of proceeds
Bellzone intends to use the proceeds of the CIF Subscription and
Institutional Placing to:
-- Fund Bellzone's share of the Forecariah Mining SA Guinea
subsidiary's annual operating costs
-- Fund Bellzone's share of the Forecariah Mine, road and port
feasibility studies
-- Fully fund the targeted 3-4 mtpa mining operation at
Forecariah
-- Fully fund the construction of the road and associated
infrastructure that will support all Forecariah production
-- Fully fund the Konta port development, all marine vessels and
support infrastructure that will support the transhipping
operations
-- Provide acceleration capital for the Kalia development that
will allow early works to commence on site and ordering of certain
long lead items, which will support a rapid start to
construction
-- Provide additional funds to allow the oxide and magnetite
development at Kalia to be accelerated
Nik Zuks, Chief Executive Officer commented "We are delighted by
the support that CIF has shown us through this subscription and we
believe that this support, combined with the funding from the
institutional placing will provide Bellzone with the platform to
develop Forecariah in conjunction with CIF and move the Company
from a developer into a near term iron ore producer. We are very
excited about moving Bellzone into production and associated
cashflow by the first quarter of 2012 which will also provide a
positive impact on the development and funding strategies for the
Kalia mine. "
Enquiries:
Bellzone Mining plc
Nik Zuks/Graham Fyfe +61 8 9420 8900
Canaccord Genuity Limited
Nominated Adviser and Joint Broker
to Bellzone
Andrew Chubb/Tarica Mpinga +44 (0)20 7050 6500
Renaissance Capital Limited
Joint Broker to Bellzone
Simon Matthews/Thomas Beattie +44 (0)20 7367 7777
Tavistock Communications +44 (0)20 7920 3150
Jos Simson/Paul Youens +44 (0)7843 260 623
Bellzone Mining plc
Bellzone Mining plc is an exploration and resource development
company with iron ore and nickel / copper permits in the Republic
of Guinea, West Africa.
The Company's flagship project, the Kalia iron mine has a JORC
resource of 3.74 billion tonnes, located on the Kalia I prospect.
Drilling results and internal estimates indicate that Kalia
prospect has the potential to host more than 10 billion tonnes of
magnetite and 2.55 billion tonnes of potential oxide at
surface.
Exploration work continues to further define the potential at
Kalia I on both the magnetite and oxide at surface.
Bellzone is committed to the staged development of the Kalia
iron project, which includes a 50mtpa iron ore facility, rail and
port, with initial production scheduled in 2014. Stage one is
planned to bring online 20mtpa direct shipping ore ('DSO') capacity
in 2014 and a 10mtpa magnetite concentrator in 2015. Stage two
increasing the DSO output to 30mtpa in 2017 and doubling the
concentrate capacity to 20mtpa by 2018.
Bellzone signed an Infrastructure Accord with the Republic of
Guinea giving the Company exclusive rights to the designated port
and rail areas for purposes of conducting studies for the
development of the infrastructure leading to the signing of a
convention and concession. The infrastructure forms a key part of
the Guinea Government's infrastructure strategy and will support
the development of iron ore, bauxite and other minerals in Guinea
through its availability for third party use.
On 2 August 2010, Bellzone announced signed definitive
agreements with China International Fund ('CIF'). CIF will finance
and develop the rail and port infrastructure and offer a finance
package to Bellzone for the development of the Kalia mine in
exchange for the first right to purchase 100% of the off-take of
the Kalia mine at market price.
An exploration and development programme is currently underway
at the CIF held Forecariah iron permits that lie between 40 and
80kms from the Guinea coast. Bellzone and CIF will jointly develop
these permits which are prospective for oxide and magnetite. The
oxide has the potential to deliver cash flow from a DSO project in
2012.
Bellzone has completed an intensive mapping and surface sampling
programme and has defined highly prospective drilling targets at
its Sadeka Nickel/Copper Project and commenced a drilling programme
on these targets in Q4 2010.
General
This announcement, including the appendices to it (together the
"Announcement"), is not for release, publication or distribution,
directly or indirectly, in or into the United States, Canada,
Australia or Japan or any jurisdiction into which the same would be
unlawful. This Announcement does not constitute and does not form a
part of an offer to sell or issue or the solicitation of an offer
to buy or acquire shares in the capital of the Company in the
United States, Canada, Australia or Japan or any jurisdiction in
which such an offer or solicitation is unlawful. The shares in the
Company referred to in this Announcement (the "Institutional
Placing Shares") have not been and will not be registered under the
U.S. Securities Act of 1933, as amended (the "US Securities Act")
or with any securities regulatory authority of any State or other
jurisdiction of the United States, and the securities may not be
offered, sold, pledged or otherwise transferred, directly or
indirectly, within the United States except pursuant to an
exemption from, or in a transaction not subject to, the
registration requirements of the US Securities Act and applicable
state securities laws. Any offering to be made in or into the
United States will be made to a limited number of "institutional
accredited investors" ("IAIs")within the meaning of Rule 501(a)
(1), (2), (3) or (7) of Regulation D under the US Securities Act
who are also "qualified institutional buyers" ("QIBs") within the
meaning of Rule 144A under the US Securities Act pursuant to an
exemption from registration under the US Securities Act in a
transaction not involving any public offering. The Institutional
Placing Shares are being offered and sold outside the United States
to non-U.S. persons, in accordance with Regulation S under the US
Securities Act. There will be no public offer of securities in the
United States. No money, securities or other consideration is being
solicited and, if sent in response to the information herein, will
not be accepted.
This Announcement has been issued by and is the sole
responsibility of the Company. No representation or warranty
express or implied, is or will be made as to, or in relation to,
and no responsibility or liability is or will be accepted by
Canaccord Genuity, Renaissance or by any of their respective
affiliates or agents as to or in relation to, the accuracy or
completeness of this Announcement or any other written or oral
information made available to or publicly available to any
interested party or its advisers, and any liability therefore is
expressly disclaimed.
Canaccord Genuity, which is authorised and regulated by the
Financial Services Authority, is acting exclusively for the Company
and no-one else in relation to the Institutional Placing and will
not be responsible to any persons other than the Company for
providing the protections afforded its clients for providing advice
in relation to the Institutional Placing or in relation to the
contents of this announcement or any other transaction, arrangement
or matter referred to in it.
Renaissance Capital Limited, which is authorised and regulated
by the Financial Services Authority, is acting exclusively for the
Company and no-one else in relation to the Institutional Placing
and will not be responsible to any persons other than the Company
for providing the protections afforded its clients for providing
advice in relation to the Institutional Placing or in relation to
the contents of this announcement or any other transaction,
arrangement or matter referred to in it.
The distribution of this Announcement or Institutional Placing
Shares in certain jurisdictions may be restricted by law. No action
has been taken by the Company or Canaccord Genuity or Renaissance
that would permit an offering of such shares or possession or
distribution of this Announcement or any other offering or
publicity material relating to such shares in any jurisdiction
where action for that purpose is required. Persons into whose
possession this Announcement comes are required by the Company and
Canaccord Genuity and Renaissance to inform themselves about, and
to observe, such restrictions.
The information in this Announcement shall not constitute an
offer to sell or the solicitation of an offer to buy, nor shall
there be any sale of, the securities referred to herein in any
jurisdiction in which such offer, solicitation or sale would
require preparation of further prospectuses or other offer
documentation, or be unlawful prior to registration, exemption from
registration or qualification under the securities laws of any such
jurisdiction.
The information in this Announcement may not be forwarded or
distributed to any other person and may not be reproduced in any
manner whatsoever. Any forwarding, distribution, reproduction, or
disclosure of this information in whole or in part is unauthorised.
Failure to comply with this directive may result in a violation of
the US Securities Act or the applicable laws of other
jurisdictions.
This Announcement is not a "prospectus" under the Companies
(Jersey) Law 1991 (as amended). Therefore, this Announcement has
not been prepared strictly in accordance with the requirements of
the Companies (General Provisions) (Jersey) Order 2002 and the
Company has not sought and does not intend to seek the consent of
the Registrar of the Companies in Jersey, and the Registrar of
Companies in Jersey has not given its consent, to the circulation
of this Announcement.
Forward-looking statements
Certain statements in this Announcement are forward-looking
statements which are based on the Company's expectations,
intentions and projections regarding its future performance,
anticipated events or trends and other matters that are not
historical facts. These statements are not guarantees of future
performance and are subject to known and unknown risks,
uncertainties and other factors that could cause actual results to
differ materially from those expressed or implied by such
forward-looking statements. Factors that would cause actual results
or events to differ from current expectations, intentions or
projections might include, amongst other things, changes in
commodity prices, changes in equity markets, political risks,
changes to regulations affecting the Company's activities, delays
in obtaining or failure to obtain any required regulatory approval,
failure of equipment, uncertainties relating to the availability
and costs of financing needed in the future, the uncertainties
involved in interpreting drilling results and other geological and
engineering data delays in obtaining geological results and other
risks associated with exploration, development and production.
Given these risks and uncertainties, prospective investors are
cautioned not to place undue reliance on forward-looking
statements. Forward-looking statements speak only as of the date of
such statements and, except as required by applicable law, the
Company undertakes no obligation to update or revise publicly any
forward-looking statements, whether as a result of new information,
future events or otherwise. The information contained in this
Announcement is subject to change without notice and neither the
Company nor Canaccord Genuity nor Renaissance assumes any
responsibility or obligation to update publicly or review any of
the forward-looking statements contained herein.
APPENDIX
TERMS AND CONDITIONS OF THE PLACING
IMPORTANT INFORMATION FOR PLACEES ONLY REGARDING THE PLACING
NOTICE TO US RESIDENTS
THIS ANNOUNCEMENT MAY NOT BE DISTRIBUTED, TAKEN OR TRANSMITTED
IN OR INTO THE UNITED STATES, ITS TERRITORIES OR POSSESSIONS AND
ANY FORWARDING, DISTRIBUTION OR REPRODUCTION OF THIS ANNOUNCEMENT
IN WHOLE OR IN PART IS UNAUTHORISED. FAILURE TO COMPLY WITH THIS
NOTICE MAY RESULT IN A VIOLATION OF THE US SECURITIES ACT OR THE
APPLICABLE LAWS OF OTHER JURISDICTIONS.
THE PLACING SHARES HAVE NOT BEEN AND WILL NOT BE REGISTERED
UNDER THE US SECURITIES ACT OR WITH ANY SECURITIES REGULATORY
AUTHORITY OF ANY STATE OR OTHER JURISDICTION OF THE UNITED STATES
AND MAY NOT BE OFFERED OR SOLD IN THE UNITED STATES UNLESS SUCH
PLACING SHARES ARE REGISTERED UNDER THE US SECURITIES ACT OR ARE
OFFERED AND SOLD PURSUANT TO AN EXEMPTION FROM, OR IN A TRANSACTION
NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE US SECURITIES
ACT AND IN COMPLIANCE WITH STATE SECURITIES LAWS. THE PLACING
SHARES ARE BEING OFFERED AND SOLD (i) OUTSIDE THE UNITED STATES TO
NON-U.S. PERSONS PURSUANT TO REGULATION S AND (ii) INSIDE THE
UNITED STATES TO IAIs WHO ARE ALSO QIBs.
PLACEES ARE NOTIFIED THAT, ALTHOUGH THE COMPANY HAS NOT MADE A
DETERMINATION AS TO WHETHER IT IS A "PASSIVE FOREIGN INVESTMENT
COMPANY" (A "PFIC") FOR U.S. FEDERAL INCOME TAX PURPOSES, THERE IS
A SIGNIFICANT LIKELIHOOD THAT IT WILL BE CLASSIFIED AS A PFIC FOR
U.S. FEDERAL INCOME TAX PURPOSES. AN INVESTMENT IN A PFIC MAY HAVE
MATERIALLY ADVERSE U.S. FEDERAL INCOME TAX CONSEQUENCES TO A U.S.
HOLDER (AS DEFINED BELOW), INCLUDING SUBJECTING THE U.S. HOLDER TO
A GREATER TAX LIABILITY THAN MAY OTHERWISE APPLY AND SUBJECTING
U.S. HOLDERS TO TAX ON AMOUNTS IN ADVANCE OF WHEN TAX WOULD
OTHERWISE BE IMPOSED. A U.S. HOLDER GENERALLY MAY BE ABLE TO MAKE
ELECTIONS TO AVOID CERTAIN OF THE ADVERSE U.S. FEDERAL INCOME TAX
CONSEQUENCES DERIVED FROM THE PFIC REGIME, INCLUDING MAKING THE
"QUALIFIED ELECTING FUND" ("QEF") ELECTION OR THE "MARK-TO-MARKET"
("MARK-TO-MARKET") ELECTION IN RESPECT OF AN INVESTMENT IN CERTAIN
PFICS. THE COMPANY DOES NOT INTEND TO MAKE AVAILABLE TO U.S.
HOLDERS OF ORDINARY SHARES THE INFORMATION THAT WOULD BE NECESSARY
IN ORDER FOR SUCH PERSONS TO MAKE A QEF ELECTION WITH RESPECT TO
THEIR ORDINARY SHARES. THE COMPANY DOES NOT ANTICIPATE THAT U.S.
HOLDERS WILL BE ABLE TO MAKE SUCH ELECTION.
THE PLACING SHARES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE
US SECURITIES AND EXCHANGE COMMISSION, ANY STATE SECURITIES
COMMISSION OR OTHER REGULATORY AUTHORITY IN THE UNITED STATES, NOR
HAVE ANY OF THE FOREGOING AUTHORITIES PASSED UPON OR ENDORSED THE
MERITS OF THE PLACING OR THE ACCURACY OR ADEQUACY OF THIS
ANNOUNCEMENT. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL
OFFENCE IN THE UNITED STATES.
NOTICE TO CANADIAN INVESTORS
THIS ANNOUNCEMENT IS NOT, AND UNDER NO CIRCUMSTANCES IS TO BE
CONSTRUED AS, A PROSPECTUS, AN ADVERTISEMENT OR A PUBLIC OFFERING
OF THE PLACING SHARES IN CANADA. NO SECURITIES COMMISSION OR
SIMILAR REGULATORY AUTHORITY IN CANADA HAS REVIEWED OR IN ANY WAY
PASSED UPON THE ANNOUNCEMENT OR THE MERITS OF THE PLACING SHARES,
AND ANY REPRESENTATION TO THE CONTRARY IS AN OFFENCE. THE
ANNOUNCEMENT IS NOT, AND UNDER NO CIRCUMSTANCES IS IT TO BE
CONSTRUED AS, AN OFFER TO SELL THE PLACING SHARES DESCRIBED HEREIN
OR A SOLICITATION OF AN OFFER TO BUY THE SECURITIES DESCRIBED
HEREIN IN ANY JURISDICTION WHERE THE OFFER OR SALE OF THESE
SECURITIES IS PROHIBITED.
THE COMPANY IS NOT A "REPORTING ISSUER," AS SUCH TERM IS DEFINED
UNDER APPLICABLE CANADIAN SECURITIES REGULATIONS, IN ANY PROVINCE
OR TERRITORY OF CANADA. THE DISTRIBUTION OF THE PLACING SHARES IN
CANADA IS BEING MADE ONLY ON A PRIVATE PLACEMENT BASIS EXEMPT FROM
THE REQUIREMENT THAT THE COMPANY PREPARE AND FILE A PROSPECTUS WITH
THE SECURITIES REGULATORY AUTHORITIES IN EACH PROVINCE WHERE TRADES
OF PLACING SHARES ARE MADE.
THE PLACING SHARES ARE BEING OFFERED BY THE COMPANY IN ALL OF
THE PROVINCES IN CANADA TO CERTAIN ACCREDITED INVESTORS (AS DEFINED
IN NATIONAL INSTRUMENT 45-106 PROSPECTUS AND REGISTRATION
EXEMPTIONS) ONLY, EACH OF WHOM WILL BE REQUIRED TO ENTER INTO A
SEPARATE SUBSCRIPTION AGREEMENT WITH THE COMPANY, WHICH WILL
INCLUDE CERTAIN ADDITIONAL REPRESENTATIONS AND WARRANTIES OF THE
CANADIAN INVESTOR, IN RESPECT OF ANY PLACING SHARES SUBSCRIBED FOR
BY SUCH CANADIAN INVESTOR. CANADIAN INVESTORS ARE ADVISED THAT THE
INFORMATION CONTAINED WITHIN THE ANNOUNCEMENT HAS NOT BEEN PREPARED
WITH REGARD TO MATTERS THAT MAY BE OF PARTICULAR CONCERN TO
CANADIAN INVESTORS. ACCORDINGLY, CANADIAN INVESTORS SHOULD CONSULT
WITH THEIR OWN LEGAL AND FINANCIAL ADVISERS CONCERNING THE
INFORMATION CONTAINED WITHIN THE ANNOUNCEMENT AND AS TO THE
SUITABILITY OF AN INVESTMENT IN THE PLACING SHARES IN THEIR
PARTICULAR CIRCUMSTANCES.
Details of the Placing
Canaccord Genuity have entered into an agreement with the
Company (the "Placing Agreement") under which, subject to the
conditions set out in that agreement, Canaccord Genuity have agreed
to use reasonable endeavours to procure subscribers for the Placing
Shares at a price determined following completion of the
bookbuilding process in respect of the Placing (the "Bookbuild"),
described in this announcement and set out in the Placing
Agreement.
Up to US$50 million in value (by reference to the Placing Price
and subject to agreement of the same) of the Placing Shares has
been underwritten by Canaccord Genuity with the balance of the
Placing Shares being placed by Canaccord Genuity and Renaissance
Capital on a reasonable endeavours basis.
The Placing Shares will, when issued, be credited as fully paid
and will rank pari passu in all respects with the existing Ordinary
Shares including the right to receive all dividends and other
distributions declared in respect of such ordinary shares after the
date of issue of the Placing Shares.
Application for admission to trading
The allotment of the Placing Shares will be conditional on,
amongst other things, the passing by shareholders of the
Resolutions granting Directors, inter alia, the authority necessary
for the issue of the Placing Shares.
The Company will apply for the Placing Shares to be admitted to
trading on AIM and subject to the passing of the Resolutions it is
expected that Admission will take place and that trading will
commence in such shares on or about 22 March 2011.
Bookbuild
Canaccord Genuity will today commence the Bookbuild to determine
demand for participation in the Placing by Placees. This Appendix
gives details of the terms and conditions of, and the mechanics of
participation in, the Placing. No commissions will be paid to
Placees or by Placees in respect of any Placing Shares.
Canaccord Genuity and the Company shall be entitled to effect
the Placing by such alternative method to the Bookbuild as they
may, in their sole discretion, determine.
Participation in, and principal terms of, the Placing:
1. Canaccord Genuity is acting as sole bookrunner and agent of
the Company. Renaissance Capital Limited ("Renaissance") is acting
as joint broker.
2. Participation in the Placing will only be available to
persons who may lawfully be, and are, invited to participate by
Canaccord Genuity. Canaccord Genuity and their affiliates are each
entitled to enter bids in the Bookbuild as principal.
3. The Bookbuild will establish a single price payable in
respect of the Placing Shares to Canaccord Genuity by all Placees
whose bids are successful. The Placing Price and the number of
Placing Shares to be issued will be agreed between Canaccord
Genuity and the Company following completion of the Bookbuild. The
Placing Price and the number of Placing Shares will be announced on
a Regulatory Information Service following the completion of the
Bookbuild.
4. To bid in the Bookbuild, Placees should communicate their bid
by telephone to their usual sales contact at Canaccord Genuity.
Each bid should state the number of Placing Shares which the
prospective Placee wishes to subscribe for at either the Placing
Price, which is ultimately established by the Company and Canaccord
Genuity, or at prices up to a price limit specified in its bid.
Bids may be scaled down by Canaccord Genuity on the basis referred
to in paragraph 9 below.
5. The Bookbuild is expected to close no later than 6.30 p.m.
(London time) on 1 March 2011 but may be closed earlier or later at
the discretion of Canaccord Genuity. Canaccord Genuity may, in
agreement with the Company, accept bids that are received after the
Bookbuild has closed. The Company reserves the right (upon the
agreement of Canaccord Genuity) to reduce or seek to increase the
amount to be raised pursuant to the Placing, in its absolute
discretion.
6. Each prospective Placee's allocation will be agreed between
Canaccord Genuity and the Company and will be confirmed orally by
Canaccord Genuity as agent of the Company following the close of
the Bookbuild. That oral confirmation will constitute an
irrevocable legally binding commitment upon that person (who will
at that point become a Placee) in favour of Canaccord Genuity and
the Company to subscribe for the number of Placing Shares allocated
to it at the Placing Price on the terms and conditions set out in
this Appendix and in accordance with the Company's articles of
association.
7. Each prospective Placee's allocation of Placing Shares and
commitment will be evidenced by a contract note issued to such
Placee by Canaccord Genuity and the terms of this Appendix will be
deemed incorporated in that contract note.
8. Each Placee will also have an immediate, separate,
irrevocable and binding obligation, owed to the Company and the
Bookrunner as agent of the Company, to pay the Bookrunner (or as it
may direct) in cleared funds, an amount equal to the product of the
Placing Price and the number of Placing Shares such Placee has
agreed to subscribe and the Company has agreed to allot and issue
to that Placee.
9. Canaccord Genuity may choose to accept bids, either in whole
or in part, on the basis of allocations determined in agreement
with the Company and may scale down any bids for this purpose on
such basis as they may determine. Canaccord Genuity may also,
notwithstanding paragraphs 4 and 5 above, subject to the prior
consent of the Company (i) allocate Placing Shares after the time
of any initial allocation to any person submitting a bid after that
time and (ii) allocate Placing Shares after the Bookbuild has
closed to any person submitting a bid after that time.
10. A bid in the Bookbuild will be made on the terms and subject
to the conditions in this announcement and will be legally binding
on the Placee on behalf of which it is made and except with the
consent of Canaccord Genuity will not be capable of variation or
revocation after the time at which it is submitted.
11. Irrespective of the time at which a Placee's allocation
pursuant to the Placing is confirmed, settlement for all Placing
Shares to be acquired pursuant to the Placing will be required to
be made at the same time, on the basis explained below under
"Registration and Settlement".
12. All obligations under the Bookbuild and Placing will be
subject to fulfilment of the conditions referred to below under
"Conditions of the Placing" and to the Placing not being terminated
on the basis referred to below.
13. By participating in the Bookbuild, each Placee will agree
that its rights and obligations in respect of the Placing will
terminate only in the circumstances described below and will not be
capable of rescission or termination by the Placee.
14. To the fullest extent permitted by law, neither Canaccord
Genuity nor any of their affiliates shall have any liability to
Placees (or to any other person whether acting on behalf of a
Placee or otherwise). In particular, neither of Canaccord Genuity
nor any of their affiliates shall have any liability (including to
the fullest extent permitted by law, any fiduciary duties) in
respect of the Bookrunner conduct of the Bookbuild or of such
alternative method of effecting the Placing as Canaccord Genuity
and the Company may agree.
Conditions of the Placing
The obligations of Canaccord Genuity under the Placing Agreement
are conditional on, amongst other things:
(a) agreement being reached between the Company and Canaccord
Genuity on the Placing Price and the number of Placing Shares;
(b) publication by the Company of an announcement of the Placing
Price;
(c) Admission taking place by 8.00 a.m. (London time) on 22
March 2011 (or such later date as the Company and Canaccord Genuity
may otherwise agree being not later than 30 April 2011); and
(d) the passing of the Resolutions, without amendment, at the
General Meeting of the Company ;
(e) the Placing Agreement becoming unconditional in all other
respects.
If any of the conditions contained in the Placing Agreement in
relation to the Placing Shares are not fulfilled or waived by
Canaccord Genuity, by the respective time or date where specified
(or such later time and/or date as the Company and Canaccord
Genuity may agree but in any event not later than 30 April 2011),
the Placing will not proceed and the Placee's rights and
obligations hereunder in relation to the Placing Shares shall cease
and terminate at such time and each Placee agrees that no claim can
be made by the Placee in respect thereof.
Canaccord Genuity may, at its discretion and upon such terms as
it thinks fit, waive compliance by the Company with the whole or
any part of any of the Company's obligations in relation to the
conditions in the Placing Agreement save that the condition in the
Placing Agreement relating to Admission taking place may not be
waived. Any such extension or waiver will not affect Placees'
commitments as set out in this announcement.
None of Canaccord Genuity, the Company or any other person shall
have any liability to any Placee (or to any other person whether
acting on behalf of a Placee or otherwise) in respect of any
decision they may make as to whether or not to waive or to extend
the time and / or the date for the satisfaction of any condition to
the Placing nor for any decision they may make as to the
satisfaction of any condition or in respect of the Placing
generally, and by participating in the Placing each Placee agrees
that any such decision is within the absolute discretion of
Canaccord Genuity.
The Placing Agreement may be terminated by Canaccord Genuity at
any time prior to Admission in certain circumstances including,
among other things, following a breach of the Placing Agreement by
the Company or the occurrence of certain force majeure events.
By participating in the Placing, Placees agree that the exercise
by Canaccord Genuity of any right of termination or other
discretion under the Placing Agreement shall be within the absolute
discretion of Canaccord Genuity and that they need not make any
reference to Placees and that they shall have no liability to
Placees whatsoever in connection with any such exercise or failure
so to exercise.
No prospectus
No offering document, prospectus or admission document has been
or will be submitted to be approved by the FSA or submitted to the
London Stock Exchange in relation to the Placing and Placees'
commitments will be made solely on the basis of the information
contained in this announcement (including the Appendices) released
by the Company today and any information previously published by
the Company by notification to a Regulatory Information Service,
and subject to the further terms set forth in the contract note to
be provided to individual prospective Placees.
Each Placee, by accepting a participation in the Placing, agrees
that the content of this announcement (including this Appendix) is
exclusively the responsibility of the Company and confirms that it
has neither received nor relied on any other information (other
than any information previously published by the Company by
notification to a Regulatory Information Service), representation,
warranty, or statement made by or on behalf of the Company or
Canaccord Genuity or any other person and none of Canaccord Genuity
or the Company nor any other person will be liable for any Placee's
decision to participate in the Placing based on any other
information, representation, warranty or statement which the
Placees may have obtained or received. Each Placee acknowledges and
agrees that it has relied on its own investigation of the business,
financial or other position of the Group in accepting a
participation in the Placing. Nothing in this paragraph shall
exclude the liability of any person for fraudulent
misrepresentation.
This announcement is not a "prospectus" under the Companies
(Jersey) Law 1991 (as amended). Therefore, this announcement has
not been prepared strictly in accordance with the requirements of
the Companies (General Provisions) (Jersey) Order 2002 and the
Company has not sought and does not intend to seek the consent of
the Registrar of the Companies in Jersey, and the Registrar of
Companies in Jersey has not given its consent, to the circulation
of this announcement.
Registration and settlement
Settlement of transactions in the Placing Shares following
Admission will take place within the system administered by
Euroclear UK & Ireland Limited ("CREST"), subject to certain
exceptions. the Company reserves the right to require settlement
for and delivery of the Placing Shares (or a portion thereof) to
Placees in certificated form if, in Canaccord Genuity's opinion,
delivery or settlement is not possible or practicable within the
CREST system or would not be consistent with the regulatory
requirements in the Placee's jurisdiction.
Following the close of the Bookbuild for the Placing, each
Placee allocated Placing Shares in the Placing will be sent a
contract note stating the number of Placing Shares to be allocated
to it at the Placing Price and settlement instructions.
Each Placee agrees that it will do all things necessary to
ensure that delivery and payment is completed in accordance with
the standing CREST or certificated settlement instructions that it
has in place with Canaccord Genuity. The Company will deliver the
Placing Shares to CREST accounts operated by Canaccord Genuity as
agent for the Company, and Canaccord Genuity will enter its
delivery (DEL) instruction into the CREST system. The input to
CREST by a Placee of a matching or acceptance instruction will then
allow delivery of the relevant Placing Shares to that Placee
against payment.
It is expected that settlement will take place on 23 March 2011
in respect of the Placing Shares (being the business day following
the General Meeting), on a delivery versus payment basis.
Interest is chargeable daily on payments not received from
Placees on the due date in accordance with the arrangements set out
above at the rate of two percentage points above LIBOR as
determined by Canaccord Genuity.
Each Placee is deemed to agree that, if it does not comply with
these obligations, the Company may sell any or all of the Placing
Shares allocated to that Placee on such Placee's behalf and retain
from the proceeds, for the Company's account and benefit, an amount
equal to the aggregate amount owed by the Placee plus any interest
due. The relevant Placee will, however, remain liable for any
shortfall below the aggregate amount owed by it and may be required
to bear any stamp duty or stamp duty reserve tax (together with any
interest or penalties) which may arise upon the sale of such
Placing Shares on such Placee's behalf.
If Placing Shares are to be delivered to a custodian or
settlement agent, Placees should ensure that the trade confirmation
is copied and delivered immediately to the relevant person within
that organisation. Insofar as Placing Shares are registered in a
Placee's name or that of its nominee or in the name of any person
for whom a Placee is contracting as agent or that of a nominee for
such person, such Placing Shares should, subject as provided below,
be so registered free from any liability to UK stamp duty or stamp
duty reserve tax. Placees will not be entitled to receive any fee
or commission in connection with the Placing.
Representations and warranties
By participating in the Placing each Placee (and any person
acting on such Placee's behalf) irrevocably acknowledges, confirms,
undertakes, represents, warrants and agrees (as the case may be)
with Canaccord Genuity (in their capacity as underwriter,
bookrunner and placing agent of the Company in respect of the
Placing), with Renaissance (in their capacity as joint broker in
respect of the Placing), and the Company, in each case as a
fundamental term of their application for Placing Shares the
following:
1 that it is, or at the time the Placing Shares are acquired
that it will be, the beneficial owner of such Placing Shares, or
that the beneficial owner of such Placing Shares is not a resident
of Australia, Canada, Japan or the United States;
2 that the Placing Shares have not been and will not be
registered under the securities legislation of the United States,
Australia, Canada or Japan and, subject to certain exceptions, may
not be offered, sold, taken up, renounced or delivered or
transferred, directly or indirectly, within those
jurisdictions;
3 that the Ordinary Shares are admitted to trading on AIM, and
that the Company is therefore required to publish certain business
and financial information in accordance with the rules and
practices of AIM (collectively, the "Exchange Information"), which
includes a description of the nature of the Company's business and
the Company's most recent balance sheet and profit and loss account
and that it is able to obtain or access (i) such Exchange
Information and (ii) such information or comparable information
concerning any other publicly traded company, in each case without
undue difficulty;
4 that none of the Bookrunner, Renaissance or the Company nor
any of their affiliates nor any person acting on behalf of any of
them has provided, and will not provide, it with any material
regarding the Placing Shares or the Group or any other person other
than this announcement; nor has it requested any of the Bookrunner,
Renaissance or the Company, nor any of their affiliates or any
person acting on behalf of any of them to provide it with any such
information;
5 that the content of this announcement is exclusively the
responsibility of the Company and that neither the Bookrunner nor
any person acting on its behalf has or shall have any liability for
any information, representation or statement contained in this
announcement or any information previously published by or on
behalf of the Company and will not be liable for any Placee's
decision to participate in the Placing based on any information,
representation or statement contained in this announcement or
otherwise. Each Placee further represents, warrants and agrees that
the only information on which it is entitled to rely and on which
such Placee has relied in committing itself to subscribe for the
Placing Shares is contained in this announcement and any
information previously published by the Company by notification to
a Regulatory Information Service, such information being all that
it deems necessary to make an investment decision in respect of the
Placing Shares and that it has neither received nor relied on any
other information given or representations, warranties or
statements made by any of the Bookrunner, Renaissance or the
Company and none of the Bookrunner, Renaissance or the Company will
be liable for any Placee's decision to accept an invitation to
participate in the Placing based on any other information,
representation, warranty or statement. Each Placee further
acknowledges and agrees that it has relied on its own investigation
of the business, financial or other position of the Group in
deciding to participate in the Placing;
6 that neither the Bookrunner nor any person acting on behalf of
them nor any of their affiliates has or shall have any liability
for any publicly available or filed information, or any
representation relating to the Group, provided that nothing in this
paragraph excludes the liability of any person for fraudulent
misrepresentation made by that person;
7 that neither it, nor the person specified by it for
registration as a holder of Placing Shares is, or is acting as
nominee or agent for, and that the Placing Shares will not be
allotted to, a person who is or may be liable to stamp duty or
stamp duty reserve tax under any of sections 67, 70, 93 and 96 of
the Finance Act 1986 (depositary receipts and clearance
services);
8 that it has complied with its obligations in connection with
money laundering and terrorist financing under the Proceeds of
Crime Act 2002, the Terrorism Act 2000, the Terrorism Act 2006 and
the Money Laundering Regulations 2007 (the "Regulations") and, if
making payment on behalf of a third party, that satisfactory
evidence has been obtained and recorded by it to verify the
identity of the third party as required by the Regulations;
9 that it is acting as principal only in respect of the
Institutional Placing or, if it is acting for any other person (i)
it is duly authorised to do so, (ii) it is and will remain liable
to the Company and/or Canaccord Genuity for the performance of all
its obligations as a Placee in respect of the Institutional Placing
(regardless of the fact that it is acting for another person),
(iii) it is both an "authorised person" for the purposes of FSMA
and a "qualified investor" as defined at Article 2.1(e)(i) of
Directive 2003/71/EC (known as the Prospectus Directive) acting as
agent for such person, and (iv) such person is either (1) a
"qualified investor" as referred to at section 86(7) of FSMA or (2)
a "client" (as defined in section 86(2) of FSMA) of its that has
engaged it to act as such client's agent on terms which enable it
to make decisions concerning the Institutional Placing or any other
offers of transferable securities on such client's behalf without
reference to such client;
10 that, if a financial intermediary, as that term is used in
Article 3(2) of EU Directive 2003/71/EC (the "Prospectus
Directive") (including any relevant implementing measure in any
member state), the Placing Shares purchased by it in the
Institutional Placing will not be acquired on a non-discretionary
basis on behalf of, nor will they be acquired with a view to their
offer or resale to, persons in a member state of the European
Economic Area which has implemented the Prospectus Directive other
than to qualified investors, or in circumstances in which the prior
consent of Canaccord Genuity has been given to the proposed offer
or resale;
11 that it has not offered or sold and, prior to the expiry of a
period of six months from Admission, will not offer or sell any
Placing Shares to persons in the United Kingdom, except to persons
whose ordinary activities involve them in acquiring, holding,
managing or disposing of investments (as principal or agent) for
the purposes of their business or otherwise in circumstances which
have not resulted and which will not result in an offer to the
public in the United Kingdom within the meaning of section 85(1) of
the Financial Services and Markets Act 2000 ("FSMA");
12 that it has not offered or sold and will not offer or sell
any Placing Shares to persons in the European Economic Area prior
to Admission except to persons whose ordinary activities involve
them in acquiring, holding, managing or disposing of investments
(as principal or agent) for the purposes of their business or
otherwise in circumstances which have not resulted in and which
will not result in an offer to the public in any member state of
the European Economic Area within the meaning of the Prospectus
Directive (including any relevant implementing measure in any
member state);
13 that it has only communicated or caused to be communicated
and will only communicate or cause to be communicated any
invitation or inducement to engage in investment activity (within
the meaning of section 21 of FSMA) relating to the Placing Shares
in circumstances in which section 21(1) of FSMA does not require
approval of the communication by an authorised person;
14 that it has complied and will comply with all applicable
provisions of FSMA with respect to anything done by it in relation
to the Placing Shares in, from or otherwise involving, the United
Kingdom;
15 that (i) it is a person falling within Article 19(5) and / or
Article 49(2)(a) to (d) of the Financial Services and Markets Act
2000 (Financial Promotion) Order 2005 or is a person to whom this
announcement may otherwise be lawfully communicated; and (ii) any
offer of Placing Shares may only be directed at persons to the
extent in member states of the European Economic Area who are
"qualified investors" within the meaning of Article 2(1)(e) of the
Prospectus Directive (Directive 2003/71/EC) and represents and
agrees that it is such a qualified investor;
16 that it is entitled to purchase the Placing Shares under the
laws of all relevant jurisdictions which apply to it, and that its
subscription/purchase of the Placing Shares will be in compliance
with applicable laws and regulations in the jurisdiction of its
residence, the residence of the Company, or otherwise;
17 that it (and any person acting on its behalf) will make
payment for the Placing Shares allocated to it in accordance with
this announcement on the due time and date set out herein, failing
which the relevant Placing Shares may be placed with other
subscribers or sold as Canaccord Genuity may in its discretion
determine and without liability to such Placee;
18 that its allocation (if any) of Placing Shares will represent
a maximum number of Placing Shares which it will be entitled, and
required, to subscribe for, and that the Company may call upon it
to subscribe for a lower number of Placing Shares (if any), but in
no event in aggregate more than the aforementioned maximum;
19 that neither of Canaccord Genuity, Renaissance nor any of
their respective affiliates, nor any person acting on behalf of
either of them, is making any recommendations to it, advising it
regarding the suitability of any transactions it may enter into in
connection with the Institutional Placing and that participation in
the Institutional Placing is on the basis that it is not and will
not be a client of the Bookrunner or Renaissance and that neither
of Canaccord Genuity or Renaissance have any duties or
responsibilities to it for providing the protections afforded to
their clients or customers or for providing advice in relation to
the Institutional Placing nor in respect of any representations,
warranties, undertakings or indemnities contained in the Placing
Agreement nor for the exercise or performance of any of its rights
and obligations thereunder including any rights to waive or vary
any conditions or exercise any termination right;
20 that the person whom it specifies for registration as holder
of the Placing Shares will be (i) itself or (ii) its nominee, as
the case may be. None of Canaccord Genuity, Renaissance or the
Company will be responsible for any liability to stamp duty or
stamp duty reserve tax resulting from a failure to observe this
requirement. Each Placee and any person acting on behalf of such
Placee agrees to participate in the Institutional Placing and it
agrees to indemnify the Company and Canaccord Genuity in respect of
the same on the basis that the Placing Shares will be allotted to
the CREST stock accounts of Canaccord Genuity who will hold them as
nominee on behalf of such Placee until settlement in accordance
with its standing settlement instructions;
21 that these terms and conditions and any agreements entered
into by it pursuant to these terms and conditions and any
non-contractual obligations arising out of or in connection with
such agreements shall be governed by and construed in accordance
with the laws of England and Wales and it submits (on behalf of
itself and on behalf of any person on whose behalf it is acting) to
the exclusive jurisdiction of the English courts as regards any
claim, dispute or matter arising out of any such contract, except
that enforcement proceedings in respect of the obligation to make
payment for the Placing Shares (together with any interest
chargeable thereon) may be taken by the Company, Renaissance or
Canaccord Genuity in any jurisdiction in which the relevant Placee
is incorporated or in which any of its securities have a quotation
on a recognised stock exchange;
22 that the Company, Canaccord Genuity and Renaissance will rely
upon the truth and accuracy of the representations, warranties and
acknowledgements set forth herein and which are irrevocable and it
irrevocably authorises the Company, Renaissance and Canaccord
Genuity to produce this announcement, pursuant to, in connection
with, or as may be required by any applicable law or regulation,
administrative or legal proceeding or official inquiry with respect
to the matters set forth herein;
23 that it will indemnify and hold the Company, Renaissance and
Canaccord Genuity and their respective affiliates harmless from any
and all costs, claims, liabilities and expenses (including legal
fees and expenses) arising out of or in connection with any breach
of the representations, warranties, acknowledgements, agreements
and undertakings in this Appendix and further agrees that the
provisions of this Appendix shall survive after completion of the
Institutional Placing;
24 that it will acquire any Placing Shares purchased by it for
its account or for one or more accounts as to each of which it
exercises sole investment discretion and it has full power to make
the acknowledgements, representations and agreements herein on
behalf of each such account;
25 that its commitment to subscribe for Placing Shares on the
terms set out herein and in the contract note will continue
notwithstanding any amendment that may in future be made to the
terms of the Institutional Placing and that Placees will have no
right to be consulted or require that their consent be obtained
with respect to the Company's, Canaccord Genuity's or Renaissance's
conduct of the Institutional Placing. The foregoing
representations, warranties and confirmations are given for the
benefit of the Company as well as Canaccord Genuity. The agreement
to settle a Placee's subscription (and/or the subscription of a
person for whom such Placee is contracting as agent) free of stamp
duty and stamp duty reserve tax depends on the settlement relating
only to the subscription by it and/or such person direct from the
Company for the Placing Shares in question. If there are any such
arrangements, or the settlement relates to any other dealing in the
Placing Shares, stamp duty or stamp duty reserve tax may be
payable. In that event the Placee agrees that it shall be
responsible for such stamp duty or stamp duty reserve tax, and
neither the Company nor Canaccord Genuity shall be responsible for
such stamp duty or stamp duty reserve tax. If this is the case,
each Placee should seek its own advice and notify Canaccord Genuity
accordingly;
26 that no action has been or will be taken by any of the
Company, Canaccord Genuity, Renaissance or any person acting on
behalf of the Company, Canaccord Genuity or Renaissance that would,
or is intended to, permit a public offer of the Placing Shares in
any country or jurisdiction where any such action for that purpose
is required;
27 that, in making any decision to purchase the Shares, it has
knowledge and experience in financial, business and international
investment matters as is required to evaluate the merits and risks
of subscribing for or purchasing the Placing Shares. It further
confirms that it is experienced in investing in securities of this
nature in this sector and is aware that it may be required to bear,
and is able to bear, the economic risk of, and is able to sustain a
complete loss in connection with the Institutional Placing. It
further confirms that it relied on its own examination and due
diligence of the Company and the Group taken as a whole, and the
terms of the Institutional Placing, including the merits and risks
involved;. that (A) an investment in the Company involves a high
degree of risk and should not be made unless the Placee is prepared
to, and can afford to, lose its entire investment; and (B) the
Company makes no representation or warranty that the Placee will
receive a return of its investment in the Company;
28 that it has (i) made its own assessment and satisfied itself
concerning legal, regulatory, tax, business and financial
considerations in connection herewith to the extent it deems
necessary; (ii) had access to review publicly available information
concerning the Company group that it considers necessary or
appropriate and sufficient in making an investment decision; (iii)
reviewed such information as it believes is necessary or
appropriate in connection with its subscription or purchase of the
Placing Shares; and (iv) made its investment decision based upon
its own judgement, due diligence and analysis and not upon any view
expressed or information provided by or on behalf of Canaccord
Genuity and Renaissance;
29 that it may not rely on any investigation that Canaccord
Genuity or any person acting on its behalf may or may not have
conducted with respect to the Company, its Group, or the
Institutional Placing and Canaccord Genuity have not made any
representation to it, express or implied, with respect to the
merits of the Institutional Placing, the subscription or purchase
of the Placing Shares, or as to the condition, financial or
otherwise, of the Company, its Group, or as to any other matter
relating thereto, and nothing herein shall be construed as a
recommendation to it to purchase the Placing Shares. It
acknowledges and agrees that no information has been prepared by
Canaccord Genuity or the Company for the purposes of this
Institutional Placing other than this announcement;
30 that accordingly it will not hold Canaccord Genuity or, any
of its respective associates or any person acting on their behalf
responsible or liable for any misstatements in or omission from any
publicly available information relating to the Group's or
information made available (whether in written or oral form) in
presentations or as part of roadshow discussions with investors
relating to the Group (the "Information") and that neither
Canaccord Genuity, or any person acting on behalf of Canaccord
Genuity, makes any representation or warranty, express or implied,
as to the truth, accuracy or completeness of such Information or
accepts any responsibility for any of such Information; and
31 that in connection with the Institutional Placing, each of
Canaccord Genuity and Renaissance and any of their respective
affiliates acting as an investor for its own account may take up
shares in the Company and in that capacity may retain, purchase or
sell for its own account such shares in the Company and any
securities of the Company or related investments and may offer or
sell such securities or other investments otherwise than in
connection with the Institutional Placing. Accordingly, references
in this announcement to shares being issued, offered or placed
should be read as including any issue, offering or placement of
such shares in the Company to Canaccord Genuity, Renaissance and
any relevant affiliate acting in such capacity. Neither Canaccord
Genuity or Renaissance intend to disclose the extent of any such
investment or transactions otherwise than in accordance with any
legal or regulatory obligations to do so;
32 that it and any person acting on its behalf is entitled to
acquire the Placing Shares under the laws of all relevant
jurisdictions and that it has all necessary capacity and has
obtained all necessary consents and authorities to enable it to
commit to this participation in the Institutional Placing and to
perform its obligations in relation thereto (including, without
limitation, in the case of any person on whose behalf it is acting,
all necessary consents and authorities to agree to the terms set
out or referred to in this Announcement) and will honour such
obligations, and it has had access to such financial and other
information concerning the Company, the Group and the Placing
Shares as it deems necessary in connection with its decision to
purchase the Placing Shares;
33 where it is acquiring Placing Shares for one or more managed
accounts, that it is authorised in writing by each managed account:
(a) to acquire the Placing Shares for each managed account; and (b)
to make on its behalf the representations, warranties,
acknowledgements, undertakings and agreements in this Appendix and
the Announcement of which it forms part;
34 that it is responsible for obtaining any legal and tax advice
that it deems necessary for the execution, delivery and performance
of its obligations in applying for Placing Shares, and that it is
not relying on the Company to provide any legal or tax advice to
it;
35 the Placee acknowledges that there is a significant
likelihood that the Company may, presently or in the future, be
classified as a "passive foreign investment company" ("PFIC") for
US federal income tax purposes and that an investment in a PFIC may
have materially adverse U.S. federal income tax consequences to a
U.S. holder including subjecting a U.S. holder to a greater tax
liability than such holder may otherwise have been subject to and
subjecting a U.S. holder to an interest charge on a deemed
underpayment of tax. The Placee has consulted with its own tax
advisers regarding the US federal income tax consequences of an
investment in a PFIC and it understands and acknowledges that the
acquisition of securities in a PFIC involves a high degree of tax
risk and it will not look to the Company, Canaccord Genuity,
Renaissance or their respective affiliates for all or part of any
additional taxes, interest or losses that it may suffer
36 that the Placee is aware that the Placing Shares have not
been and will not be registered under the US Securities Act or with
any securities regulatory authority of any state or other
jurisdiction of the United States and that the Placee will not
offer, sell, pledge or transfer any Placing Shares, except in
accordance with the US Securities Act and any applicable laws of
any state of the United States and any other jurisdiction;
37 that it (a) is outside the United States and it is not a U.S.
Person purchasing the Placing Shares in an offshore transaction
meeting the requirements of Regulation S and such purchase is not a
result of any directed selling efforts within the meaning of Rule
902(c) of Regulation S or (b) (1) it is in the United States and is
a QIB who is also an IAI who is purchasing the Placing Shares for
its own account, or for the account of one or more persons who are
QIBs and are also an IAI, (2) is aware, and each beneficial owner
of such Placing Shares has been advised, that the sale of such
Placing Shares to it is being made in reliance on an exemption from
the registration requirements of the US Securities Act, (3) is
purchasing the Placing Shares for its own account or for the
account of one or more other investors who are QIBs and are also an
IAI for which it is acting as a duly authorised fiduciary or agent,
in each case for investment, and not with a view to, or for offer
or sale in connection with, any distribution thereof within the
meaning of the US Securities Act and the Placee has no plans to
enter into any contract, undertaking, agreement or arrangement for
any such purpose and (4) has not purchased the Placing Shares as a
result of "general solicitation" or "general advertising" (within
the meaning of Rule 502(c) under the US Securities Act), including
advertisements, articles, research reports, notices or other
communications published in any newspaper, magazine, on a website
or in or on any similar media, or broadcast over radio or
television, or any seminar or meeting whose attendees have been
invited by general solicitation or general advertising;
38 that it is entitled to subscribe for the Placing Shares under
the laws of all relevant jurisdictions which apply to it; unless it
can give the representations in paragraph 39(b) above, it is
outside the United States; has not purchased the Placing Shares as
a result of any directed selling efforts within the meaning of Rule
902(c) of Regulation S; and its purchase of the Placing Shares will
be in compliance with the requirements of Regulation S, including,
without limitation, that the offer and sale of the Placing Shares
to it will be made in an "offshore transaction" as such term is
defined in Regulation S;
39 that the Placing Shares are being offered in a transaction
not involving any public offering in the United States within the
meaning of the US Securities Act and that the Placing Shares have
not been and will not be registered under the US Securities Act or
the securities laws of any State in the United States and further
acknowledges that the Placing Shares have not been approved or
disapproved by the United States Securities and Exchange Commission
or any other Federal or state regulatory agency, nor has any such
agency passed on the merits of an investment in the Company;
40 that no representation has been, is being or will be made by
the Company as to the availability of an exemption from the
registration for the reoffer, resale, pledge or transfer of the
Placing Shares in accordance the US Securities Act;
41 that for so long as any of the Placing Shares are "restricted
securities" within the meaning of Rule 144(a)(3) under the US
Securities Act, it shall not resell or otherwise transfer any of
the Placing Shares except (i) to the Company or any of its
affiliates; (ii) outside the United States of America pursuant to
Rule 903 or Rule 904 of Regulation S; (iii) inside the United
States to any person whom the Placee and any person acting on its
behalf reasonably believes is a QIB who is also an IAI subscribing
for its own account or for the account of a QIB each of whom is
also an IAI in a transaction exempt from the registration
requirements of the US Securities Act, (iv) pursuant to Rule 144
under the US Securities Act (if available), or (v) pursuant to an
effective registration under the US Securities Act, in each case in
accordance with any applicable securities laws of any state of the
United States. The Placee also agrees that for so long as the
Placing Shares are "restricted securities" within the meaning of
Rule 144(a)(3) under the US Securities Act, it will not deposit
such shares in any unrestricted depositary facility established or
maintained by a depositary bank. The Placee also understands that
no representation can be made as to the availability of the
exemption provided by Rule 144 for resales of interests in the
Placing Shares. Further, the Placee agrees to notify any transferee
to whom it subsequently reoffers, resells, pledges or otherwise
transfers the Placing Shares of the foregoing restrictions on
transfer;
42 that its Placing Shares, if issued in certificated form, will
bear a legend substantially to the following effect, until the
expiration of the applicable holding period with respect to the
Placing Shares set forth in Rule 144 under the US Securities
Act:
"THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED
UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE "US
SECURITIES ACT") OR ANY STATE SECURITIES LAWS. THE HOLDER HEREBY,
BY PURCHASING SUCH SECURITIES, AGREES FOR THE BENEFIT OF BELLZONE
MINING PLC THAT SUCH SECURITIES MAY BE OFFERED, SOLD, PLEDGED OR
OTHERWISE TRANSFERRED ONLY (A) to BELLZONE MINING PLC AND ITS
AFFILIATES; (B) OUTSIDE THE UNITED STATES TO NON U.S. PERSONS IN AN
OFFSHORE TRANSACTION IN ACCORDANCE WITH RULE 903 OR RULE 904 OF
REGULATION S UNDER THE US SECURITIES ACT AND APPLICABLE FOREIGN
LAWS; (C) Inside the United States TO A PERSON THAT THE HOLDER AND
ANY PERSON ACTING ON ITS BEHALF REASONABLY BELIEVES IS A QUALIFIED
INSTITUTIONAL BUYER WITHIN THE MEANING OF RULE 144A Under the US
Securities Act (a "QIB") who is also an institutional Accredited
Investor defined in rule 501(A)(1), (2), (3) and (7) under the US
Securities Act (an "IAI"), PURCHASING FOR ITS OWN ACCOUNT OR FOR
THE ACCOUNT OF ONE OR MORE QIBs each of whom is also an IAI WHOM
THE HOLDER HAS INFORMED, IN EACH CASE, THAT SUCH OFFER, SALE,
PLEDGE OR OTHER TRANSFER IS BEING MADE IN RELIANCE ON an Exemption
from registration requirements of the US Securities Act; (D)
pursuant to Rule 144 under the US securities act (if applicable);
or (e) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT THAT COVERS
RESALES OF SECURITIES. THE HOLDER FURTHER AGREES THAT THE ORDINARY
SHARES ARE "RESTRICTED SECURITIES" WITHIN THE MEANING OF RULE
144(A)(3) UNDER THE US SECURITIES ACT AND THAT IT WILL NOT DEPOSIT
SUCH SECURITIES INTO ANY UNRESTRICTED DEPOSITARY RECEIPT FACILITY
IN RESPECT OF SHAREs OF BELLZONE MINING PLCESTABLISHED OR
MAINTAINED BY A DEPOSITARY PLACING AGENT;
43 that in the United States (i) there are substantial
restrictions on the transferability of the Placing Shares, and that
it must bear the economic risk of an investment in the Placing
Shares for an indefinite period of time because the Placing Shares
cannot be sold, transferred, assigned, hypothecated, pledged, or
otherwise disposed of except as provided below; (ii) the Placing
Shares to be acquired by the Placee may not be sold, transferred,
or otherwise disposed of unless the Placing Shares are registered
pursuant to the US Securities Act, or an exemption from
registration under the US Securities Act is available, and that in
the absence of either an effective registration statement covering
such Placing Shares or an available exemption from registration
under the US Securities Act, the Placing Shares must be held
indefinitely; (iii) the Company has no present intention of
registering the Placing Shares to be acquired by the Placee; and
(iv) there is no assurance that any exemption from registration
under the US Securities Act will be available and, even if
available, such exemption may not allow the Placee to transfer all
or any portion of the Placing Shares to be acquired by it in the
circumstances, in the amounts or at the times the Placee might
propose;
44 that:
I. until 40 days after the commencement of the Institutional
Placing, an offer or sale of the Placing Shares into or within the
United States by a dealer, whether or not such dealer is
participating in this offering, may violate the registration and
prospectus delivery requirements of the US Securities Act if such
offer or sale is not made in accordance with an exemption from the
registration requirements of the US Securities Act;
II. it has not, its affiliates (as defined in Rule 405 under the
US Securities Act) have not, and any persons acting on its or their
behalf have not engaged and will not engage in any directed selling
efforts (as defined in Regulation S) with respect to the Placing
Shares; and
III. it has not, and its affiliates (as defined in Rule 501(b)
under the US Securities Act) have not, and any person acting on its
or their behalf have not engaged and will not engage in any form of
general solicitation or general advertising (within the meaning of
Rule 502(c) under the US Securities Act), including advertisements,
articles, research reports, notices or other communications
published in any newspaper, magazine, on a website or in or on any
similar media, or broadcast over radio or television, or any
seminar or meeting whose attendees have been invited by general
solicitation or general advertising in connection with any offer or
sale of the Placing Shares.
45 that it has had an opportunity to ask questions of, and to
receive information from, the Company and persons acting on its
behalf concerning the terms and conditions of the Institutional
Placing, and to obtain any additional information necessary to
verify the accuracy of the information and data received by the
Placee;
46 to furnish any information requested to assure compliance
with applicable federal and state securities laws in connection
with the purchase and sale of the Placing Shares;
47 that the Placee has not used any person as a "Purchaser
Representative" within the meaning of Regulation D under the US
Securities Act to represent it in determining whether it should
purchase the Placing Shares.
When a Placee or person acting on behalf of the Placee is
dealing with Canaccord Genuity, any money held in an account with
Canaccord Genuity on behalf of the Placee and/or any person acting
on behalf of the Placee will not be treated as client money within
the meaning of the rules and regulations of the FSA made under
FSMA. The Placee acknowledges that the money will not be subject to
the protections conferred by the client money rules; as a
consequence, this money will not be segregated from the
Bookrunner's money in accordance with the client money rules and
will be used by the Bookrunner in the course of their own business;
and the Placee will rank only as a general creditor of Canaccord
Genuity.
All times and dates in this announcement may be subject to
amendment. Canaccord Genuity shall notify the Placees and any
person acting on behalf of the Placees of any changes.
Past performance is no guide to future performance and persons
needing advice should consult an independent financial adviser.
DEFINITIONS
Terms not otherwise defined below have the same meanings given
to them elsewhere in this announcement:
"Admission" means admission of the Placing Shares to AIM;
"AIM" means the AIM market of the London Stock Exchange;
"Board" means the board of directors of the Company;
"Bookrunner" means Canaccord Genuity;
"Canaccord Genuity" means Canaccord Genuity Limited;
"Company" means Bellzone Mining plc;
"Companies Laws" means the Companies (Jersey) Law 1991 as
mended;
"Directors" means the directors of the Company;
"General Meeting" or "GM" means the extraordinary general
meeting of the Company proposed to be held on or around 21 March
2011;
"Group" means the Company and its subsidiary undertakings;
"Institutional Placing" means the placing of the Placing Shares
described in this announcement;
"London Stock Exchange" means London Stock Exchange plc;
"Ordinary Shares" means the ordinary shares in the share capital
of the Company;
"Placees" means investors with whom Placing Shares are
placed;
"Placing Agreement" means the agreement dated 1 March 2011
entered into by the Company and Canaccord Genuity in connection
with the " Institutional Placing" means the placing of the Placing
Shares described in this announcement;
"Placing Price" means the price at which the Placing Shares are
to be issued pursuant to the Placing;
"Placing Shares" means the new Ordinary Shares to be issued
pursuant to the Institutional Placing;
"Regulatory Information Service" has the meaning attributed
thereto in the AIM Rules for Companies issued by the London Stock
Exchange
"Resolutions" means the resolutions to be set out in the notice
of General Meeting pursuant to which it is proposed that the
Directors be authorised to allot the Placing Shares;
"United States" or "US" means the United States of America, its
territories and possessions, any State of the United States and the
District of Columbia; and
"GBP" means the lawful currency of the United Kingdom.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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