Tri-Star Resources PLC Tri-Star invests further $6mln in SPMP (7881X)
November 29 2017 - 2:01AM
UK Regulatory
TIDMTSTR TIDMTTM
RNS Number : 7881X
Tri-Star Resources PLC
29 November 2017
Certain information contained in this announcement would have
been deemed inside information for the purposes of Article 7 of
Regulation (EU) No. 596/2014 until the release of this
announcement
29 November 2017
Tri-Star Resources plc
("Tri-Star" or the "Company")
Tri-Star invests a further $6 million in Oman joint venture
company SPMP
Tri-Star announces that it has invested a further $6 million via
a mezzanine loan to Strategic & Precious Metals Processing LLC
("SPMP") ("SPMP Mezzanine Loan") to assist in further development
of the Oman Antimony Roaster Project ("OAR"). The OAR is located in
Sohar, Sultanate of Oman. Tri-Star has a 40% equity interest in
SPMP.
The investment in SPMP has been financed through the issuance of
short-dated secured loan notes ("Loan Notes") to Odey European Inc
and OEI MAC Inc (the "OAM Funds"). The OAM Funds are funds under
the discretionary management of Odey Asset Management LLP
("OAM").
Terms of the SPMP Mezzanine Loan
The principal terms of the SPMP Mezzanine Loan are as
follows:
-- $6 million to be invested in SPMP by way of unsecured
mezzanine finance subordinated to the existing $40 million senior
debt facility;
-- An interest rate of 15% per annum, payable in full on redemption of the loan;
-- Ranks pari passu with the existing mezzanine loans already in place at SPMP;
-- Loan term of five years with SPMP having the option to redeem
(with accrued interest to date) from the third anniversary of
drawdown.
The terms of the SPMP Mezzanine Loan are principally the same as
the existing mezzanine loan of $15 million advanced at the time of
financial close of SPMP in September 2015 by the other shareholders
in SPMP.
Terms of the Loan Notes
The principal terms of the Loan Notes are as follows:
-- $6 million of notes have been issued:
o $3,400,543 to Odey European Inc; and
o $2,599,457 to OEI MAC INC
-- The notes are secured on a Debenture comprising a fixed and
floating charge over all the assets of the Company;
-- The notes are to be redeemed on the earlier of 30 June 2018
or the completion of an equity fundraise by the Company;
-- An arrangement fee of 3%; and further costs of up to GBP100,000 to be paid by the Company;
-- The notes accrue interest at 25% per annum, accruing daily and payable on redemption;
-- Events of default as are customary for an instrument of this
nature and including the insolvency of SPMP.
Related Party Transaction
Since OAM controls 53.8% of the Company's issued share capital,
OAM is a related party as defined in the AIM Rules for Companies
and the subscription by the OAM Funds for the Loan Notes is deemed
a related party transaction under the AIM Rules. Tri-Star's
independent directors consider, having consulted with Tri-Star's
nominated adviser SP Angel Corporate Finance LLP, that the terms of
the Loan Note transaction are fair and reasonable insofar as
Tri-Star's shareholders are concerned.
SPMP Financing
SPMP is working with providers of bank finance and its various
other stakeholders on an additional funding package to satisfy all
SPMP's funding requirements through to commercial production.
Further announcements will be made by Tri-Star, as appropriate.
Crispin Odey, Founder, Odey Asset Management, said:
"We are delighted to continue to support the OAR project through
this interim loan structure with Tri-Star. We have built up an
excellent relationship with our partners in Oman and Dubai and
continue to see positive signs for this business as we complete the
project and bed down agreements on the feedstock and offtake
side."
References to "$" in this announcement mean US dollars.
Enquiries:
Tri-Star Resources plc Tel: +44 (0) 20 3470 0470
Guy Eastaugh, Chief Executive Officer
SP Angel Corporate Finance (Nomad and Broker) Tel: +44 (0) 20
3470 0470
Robert Wooldridge / Jeff Keating
Yellow Jersey PR Limited (Media Relations) Tel: +44 (0) 776 932
5254
Felicity Winkles / Joe Burgess
This information is provided by RNS
The company news service from the London Stock Exchange
END
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