Stratmin Global Resources PLC Early settlement of outstanding payments from Bass (8573R)
December 15 2016 - 2:00AM
UK Regulatory
TIDMSTGR
RNS Number : 8573R
Stratmin Global Resources PLC
15 December 2016
15 December 2016
Dissemination of a Regulatory Announcement that contains inside
information according to REGULATION (EU) No 596/2014 (MAR).
StratMin Global Resources Plc
("StratMin" or the "Company")
Early cash settlement of outstanding payments from Bass Metals
Ltd
StratMin Global Resources Plc (AIM: STGR) has agreed to an
immediate discounted cash settlement of the share payments from
Bass Metals Ltd ("Bass") under the 6 June 2016 Share Purchase
Agreement ("SPA"). Under the SPA, Bass equity was to be issued to
StratMin in two tranches of A$3 million and A$5 million subject to
Bass meeting certain performance criteria by 31 December 2017 and
31 December 2018 respectively. Bass recently approached StratMin
with an offer to settle the equity payments in cash and facilitate
the divestment of the Company's remaining 70 million Bass share.
The Board considered this offer with reference to the recent share
price performance of both Bass and StratMin and the need to
establish the best possible platform for StratMin ahead of
initiating a reverse takeover ("RTO"). The early settlement has
been agreed with the following terms:
-- Payment by Bass of A$2,640,000 in cash consisting of,
o A$955,000 on or before 16 December 2016;
o A$1,185,000 on or before 15 March 2017; and
o A$500,000 on or before 30 September 2017.
-- Immediate placement of the entire remaining 70 million
shareholding in Bass at a minimum price of 1.3 cents per share.
o This will provide a further A$910,000 in cash to StratMin in
the next 5 days.
-- An option for Bass to purchase the 2.5% royalty for A$500,000
prior to 30 June 2018 with a royalty holiday if purchased prior to
31 December 2017 (the "Royalty").
In summary, this settlement will provide StratMin with an
immediate A$1,865,000 (GBP1.1 million) in cash and a total of
A$3,550,000 (GBP2.1 million) in cash with potential for a further
A$500,000 (GBP296,000) from the sale of the Royalty.
In addition, all warranties provided by StratMin to Bass under
the SPA are immediately extinguished, removing any potential
liability for the Company from historic operations.
The Company announced the establishment of a US$1.5 million loan
facility on 28 September 2016 (the "Announcement"). As stated in
the Announcement, the loan was to be used primarily to provide
funding to develop the Vatomaina graphite project joint venture
(the "JV"). The Company subsequently determined to prioritise
completion of an RTO with a focus on opportunities in the gold
sector, as announced on 30 November 2016. The loan facility was
undrawn but was not terminated as the Company considered
alternatives for continued participation in the JV. With the
Company's change of strategic direction and the collateral for the
loan being the holding in Bass that will be divested in conjunction
with this settlement; the facility will be duly terminated.
StratMin is not planning to increase its participation in the JV in
the foreseeable future.
Brett Boynton, CEO commented:
"The Board is conscious of the pressure on the StratMin share
price and market speculation of a discounted capital raise in the
near term. The early settlement with Bass and divestment of the
Bass equity holding removes the need for the Company to raise short
term capital with a weak share price and provides a stronger
platform for negotiating an RTO. This transaction mitigates
completion risk with Bass and provides capital to pursue the
Company's gold strategy which the Board believes will deliver
better shareholder returns."
For further information please visit www.stratminglobal.com or
contact:
StratMin Global Resources Plc +44 (0) 20
Brett Boynton, CEO 3691 6160
Allenby Capital (Nominated Adviser
& Broker)
John Depasquale/ Nick Harriss/Liz +44 (0) 020
Kirchner 3328 5656
Optiva Securities (Broker) +44 (0) 20
Christian Dennis 3137 1903
VSA Capital Limited (Financial
Adviser) +44 (0) 20
Andrew Raca 3005 5000
This information is provided by RNS
The company news service from the London Stock Exchange
END
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