TIDMDCP
RNS Number : 1600U
Diamondcorp Plc
13 January 2017
13 January 2017
DiamondCorp plc
AIM share code: DCP & JSE share code: DMC
ISIN: GB00B183ZC46
(Incorporated in England and Wales)
(Registration number 05400982)
(SA company registration number 2007/031444/10)
("DiamondCorp", "the Company" or "the Group")
Proposed placing to raise c.GBP1 million
Operational and Corporate Update
DiamondCorp, the Southern African diamond mining, development
and exploration company, provides the following corporate and
operational updates and outlook in respect of the Lace mine and the
business rescue implemented in respect of the Company's 74%
operating subsidiary Lace Diamond Mines (Pty) Limited ("LDM")
("Business Rescue").
The Company also announces a proposed conditional placing to
raise gross proceeds of c.GBP1 million (the "Placing") through the
issuance of new ordinary shares of 0.1 pence each in the Company
(the "Placing Shares") with attached warrants over new ordinary
shares ("Warrants") on the basis of one Warrant for every Placing
Share subscribed. It is expected that the Placing Shares will be
priced at, or around, 4 pence each, with each Warrant expected to
be exercisable at 1 pence between 1 November 2017 and 30 June
2019.
The Placing is being conducted through a bookbuilding process
which will be launched immediately following this announcement,
will be made to new and existing eligible institutional and other
investors, and the books are expected to close no later than 09:00
UK time on 19 January 2017, but Panmure Gordon reserves the right
to close the books earlier, without further notice. Completion and
settlement of the Placing is conditional upon, inter alia,
concluding a labour agreement with the Association of Mineworkers
and Construction Union ("AMCU") that is on terms approved by the
Business Rescue Practitioner (Deloitte & Touche, the "BRP"), on
behalf of LDM, and by the Board of DiamondCorp.
Highlights
-- The Group has entered into standstill agreements with the
Group's UK and South African bondholders.
-- As previously announced, a standstill agreement has been
reached with LDM's primary secured lender, the Industrial
Development Corporation of South Africa (the "IDC").
-- Discussions are ongoing between Deloitte & Touche (the
BRP) and the Company, and between the BRP and the labour unions and
the non-unionised workforce with respect to the implementation of
the care and maintenance and remediation work, which has yet to
commence.
-- An agreement between the BRP and AMCU with respect to
retrenchments and outstanding wages needs to be finalised in the
very near term or it is likely that the Group will not be a going
concern and will enter into insolvency proceedings.
-- Management continues to evaluate, in conjunction with the
BRP, the Group's capital requirements during, and in the event of a
successful conclusion of, the Business Rescue process. Capital will
be required in a phased manner to fund the Group's critical
expenditure requirements as the Business Rescue process continues
(Phase 1) and, if then successfully concluded, resume Lace mining
operations and recommence the ramp-up of production from the UK4
mine (Phase 2).
-- Proposed conditional Placing of GBP1 million in respect of Phase 1:
o Anticipated Placing Price of 4 pence each, with accompanying
Warrants (exercisable at 1 pence between the period of 1 November
2017 and 30 June 2019 and issued on a 1 for 1 basis per Placing
Share;
o Net proceeds of the Placing, together with the Group's current
cash, to be utilised towards: Lace mine care and maintenance and
mine remediation costs; the costs of the ongoing Business Rescue
process; and cash settlement of the agreement to be reached with
respect to labour;
o Settlement of the Placing is anticipated to occur on 25
January 2017 and is conditional upon, inter alia, concluding a
labour agreement with the AMCU that is on terms approved by the
BRP, on behalf of LDM, and by the Board of DiamondCorp;
o Certain of the Company's major institutional shareholders have
indicated a willingness to participate in the Placing.
Corporate and Operational Update
-- The Lace mine is currently non-operational, pending receipt
of sufficient funding to enter into the care and maintenance and
remediation process.
-- LDM's insurance policy covers the flood damage to movable
equipment (subject to payment of a 10% excess) and the level of
cover is considered sufficient to carry out the repairs necessary
to the damaged longhole drill rig, which will need to be conducted
offsite. The insurance claim is ongoing.
-- Settlement negotiations are continuing between the BRP and
the insurance company with respect to LDM's ongoing insurance claim
in respect of an incident prior to the flood and a resolution on
this is anticipated shortly.
-- The Group currently has cash equivalent to c.GBP240,000.
-- At LDM, and based on current exchange rates, the Company is
the largest creditor with c.GBP36 million owed in a subordinated
shareholder loan. LDM's Senior Secured lender is the IDC with a
c.GBP18 million project loan. Trade creditors are c.GBP1.5
million.
-- In addition, c.GBP3.7 million is owed to UK and South African
bond holders, c.GBP5 million to Laurelton Diamonds, c.GBP0.5
million to Rasmala plc and c.GBP0.1 million to trade creditors.
-- The Group's net debt is c.GBP29 million, based on current exchange rates.
-- Please refer to the announcement dated 19 December 2016 in
respect of the various standstill and amendment agreements that the
Group has entered into with a number of its creditors to periods of
between, variously, 30 March 2017 and until the completion of the
Business Rescue proceedings.
-- The Group has also now formally entered into standstill
agreements with: (i) the Group's UK bondholders until such time as
Business Rescue proceedings in respect of LDM have been concluded;
and (ii) the South African bondholders until such time as Business
Rescue proceedings in respect of LDM have been concluded or until
13 March 2017, whichever occurs first. Should an extension be
necessary, the Group would seek to extend the duration of the
various creditor standstill and amendment agreements where and if
deemed appropriate.
-- The Company's shares will remain suspended and it is expected
that a lifting of the suspension shall not be sought until the
successful completion of the Business Rescue process and completion
of the anticipated Phase 2 fundraise, as further described
below.
Outlook
-- In order to formally enter into, and complete, a care and
maintenance and mine remediation programme at the Lace mine, it is
critical that an agreement first be reached with the AMCU to
address retrenchments and reach a settlement on the balance of
labour for the period up to completion of care and maintenance
(expected to be until the end of April 2017) and those employees
required for recommencement of production ramp-up from the UK4
mine.
-- During the Phase 1 care and maintenance and mine remediation
period, the Company will recommence mine water pumping and
rehabilitate underground roadways, thereby enabling the longhole
drill rig to be brought to surface, repair and restore underground
electrical reticulation and ready the mine for restart while the
rig is rebuilt by Sandvik.
-- In the same period, the BRP must complete a business rescue
plan to restructure LDM's creditor position such that LDM, and the
Group, is sufficiently recapitalised to achieve a solvent exit from
the Business Rescue process. Once proposed, the Business Rescue
plan is to be voted upon by LDM creditors and, as stated above, the
Company and IDC are significantly the largest creditors to LDM in
aggregate. Whilst financial projections are ongoing by management,
the BRP and PwC, it is currently estimated that the necessary Phase
2 funding could be approximately GBP3-5 million.
-- If the BRP is successful in achieving an affordable labour
agreement and obtaining approval of the 'rescue plan', and the
Company completes its Phase 2 funding, then UK4 mining operations
are expected to resume a ramp up, over a period of approximately
four months following completion of the care and maintenance
programme, to 30,000 tonnes per month of blasted kimberlite. This
level of commercial production could be continued for approximately
24 months.
-- While the Phase 2 mining of UK4 continues, the Company would
need to arrange additional funding in order to access and develop
kimberlite deeper than the existing production level, notably the
proposed 500m block cave level.
-- Management is in various discussions with certain senior
personnel with a view to them joining the Company in conjunction
with the Phase 2 fundraise and manage the Lace mine production and
development activities. Such positions are anticipated to include
Executive and Non-executive Board appointments.
-- Mr Loudon, CEO, has expressed a willingness in principle to
accept payment of a majority of accrued and future remuneration by
way of new equity. Terms have yet to be agreed.
The Placing
As discussed above, and further detailed below, the net proceeds
of the Placing, in conjunction with current cash on hand and
anticipated insurance claim payments, will be utilised towards
funding the Group's critical expenditure requirements during the
Business Rescue and care and maintenance and mine rehabilitation
period and through to early to mid-April 2017. The Placing is also
anticipated to enable the Group to reach an agreement with AMCU in
the very near term, which is critical to the implementation of care
and maintenance programme and to the success of the ongoing
Business Rescue process.
It should be highlighted that completion of the Placing, and
settlement of the Placing Shares and Warrants, is conditional upon,
inter alia, the Group entering into an agreement with the AMCU, the
labour union covering the Lace mine, to reduce the ongoing labour
expenses at the Lace mine, such that there is adequate cover for
the care and maintenance expenses and mine remediation costs to
prepare the mine for a restart of production ramp up from the UK4
mine (should the Business Rescue conclude successfully).
No assurances can be given at this stage that (i) the Company
will successfully conclude a AMCU labour agreement on terms
approved by both the BRP, on behalf of LDM, and by the Board of
DiamondCorp, either in sufficient time for completion of the
Placing or at all; or that (ii) the Business Rescue process and
concurrent additional fundraise will be concluded successfully by
early April 2017 or at all.
In the event that a satisfactory labour agreement is not entered
into, and the Placing not completed, in the very near term, it is
likely that the Group will not be a going concern and will enter
into insolvency proceedings. Notwithstanding a successful labour
agreement and completion of the Placing, in the event that the
Business Rescue process and concurrent additional Phase 2 fundraise
is not successfully concluded by early April 2017, it is likely
that the Group will not be a going concern at that point and will
enter into insolvency proceedings.
It should further be noted that the Company's shares will remain
suspended and it is expected that a lifting of the suspension shall
not be sought until a successful conclusion of the Business Rescue
process and completion of the anticipated Phase 2 fundraise.
Use of proceeds
The net proceeds of the Placing, in conjunction with current
cash on hand and anticipated insurance claim payments will be used
towards funding the Group's critical expenditure requirements until
early to mid-April 2017 with a view to seeking to be in a position
to successfully conclude the Business Rescue process at that time,
alongside a Phase 2 fundraise, as discussed above. Specifically,
the net proceeds will be used, based on current exchange rates, as
follows:
-- Lace Mine care and maintenance costs until early to mid-April 2017 (c. GBP649,000)
-- Direct Business Rescue costs: (c. GBP285,000)
-- General LDM and DiamondCorp corporate costs, including
ancillary Business Rescue expenses : (c. GBP190,000)
The Group's remaining cash balance will be made available to
reach a labour settlement. The Company also has the potential to
apply additional funds raised towards strengthening the Company's
balance sheet and aiding a successful conclusion of the Business
Rescue process.
Details of the Placing
The Placing will be conducted in accordance with the terms and
conditions set out in Appendix I. The Placing will be effected by
way of a bookbuilding process to be managed by Panmure Gordon (UK)
Limited ("Panmure Gordon"). The bookbuilding process will commence
with immediate effect. The timing of the closing of the book,
pricing and allocations is at the absolute discretion of Panmure
Gordon, although the closing of the book is currently anticipated
to occur no later than 09:00 UK time on 19 January 2017. The price
at which the Placing Shares are to be placed (the "Placing Price")
and the number of Placing Shares with attached Warrants will be
agreed by the Company with Panmure Gordon at the close of the
bookbuilding period. Details of the Placing Price and the number of
Placing Shares with attached Warrants will be announced as soon as
practicable after the close of the bookbuilding process. The
Placing Shares will, when issued, be credited as fully paid and
will rank equally in all respects with the existing ordinary shares
of the Company, including the right to receive all dividends and
other distributions declared, made or paid in respect of such
shares after the date of issue of the Placing Shares.
The Warrants, which will be issued on the basis of one Warrant
for each Placing Share subscribed for are expected to be
exercisable at 1 pence at any time during the period commencing on
1 November 2017 and expiring on 30 June 2019. In addition, the
Warrants shall be exercisable at any time until 30 June 2019 in the
event of a change in control of the Company. The Warrants, which
will be transferable, will not be admitted to trading on AIM, AltX
or otherwise. The instrument constituting the Warrants will contain
customary limited anti-dilution provisions, covering certain
limited events such as, inter alia, sub-division or consolidation
of the Company's Ordinary Shares.
Certain of the Company's major institutional shareholders have
indicated a willingness to participate in the Placing.
Completion of the Placing is conditional, inter alia, on:
-- concluding a labour agreement with the AMCU that is on terms
approved by both the BRP, on behalf of LDM, and the Board of
DiamondCorp; and
-- admission of the Placing Shares to the AIM Market of the
London Stock Exchange plc ("AIM"), becoming effective by no later
than 8.00 a.m. on 25 January 2017 or such other date (being not
later than 8.00 a.m. on 31 January 2017) as the Company and Panmure
Gordon may agree.
Application will be made for the Placing Shares to be admitted
to the AIM Market of the London Stock Exchange plc ("AIM") and the
Alternative Exchange of the JSE Limited ("AltX"). Settlement for
and Admission of the Placing Shares is currently expected to take
place on 25 January 2017. However, trading will not commence until
the lifting of the existing trading suspension has been granted and
therefore the Placing Shares will be subject to the ongoing trading
suspension on AIM and AltX.
The Company reserves the right to settle certain applicable
investors' participation(s) by way of a direct subscription with
the Company, having consulted with Panmure Gordon.
Panmure Gordon will receive professional fees pursuant to both
the Placing and in satisfaction of certain outstanding indebtedness
in the form of new Ordinary Shares at the Placing Price and
warrants on the same terms as the Warrants.
This Announcement should be read in its entirety. In particular,
your attention is drawn to the "Important Information" section of
this Announcement, to the detailed terms and conditions of the
Placing and further information relating to the bookbuilding
process described in Appendix I. By choosing to participate in the
Placing and by making an oral and legally binding offer to acquire
Placing Shares, each with one Warrant attached, investors will be
deemed to have read and understood this Announcement in its
entirety and to be making such offer on the terms and subject to
the conditions in it, and to be providing the representations,
warranties, acknowledgements and undertakings contained in Appendix
I.
This announcement contains inside information for the purposes
of Article 7 of the Market Abuse Regulation (EU) No 596/2014
("MAR"). Market soundings, as defined in MAR, were taken in respect
of the Placing with the result that certain persons became aware of
inside information, as permitted by MAR. That inside information is
set out in this announcement and has been disclosed as soon as
possible in accordance with paragraph 7 of article 17 of MAR.
Therefore, those persons that received inside information in a
market sounding are no longer in possession of inside information
relating to the Company and its securities.
Contact details:
DiamondCorp plc
Chris Ellis, Interim Non-Executive Chairman
Tel: +44 (0) 20 3151 0970
Paul Loudon, Chief Executive
Tel: +27 56 216 1300
UK Broker, Sole Placing Agent & Nominated Adviser
Panmure Gordon (UK) Limited
Adam James / Atholl Tweedie
Tel: +44 20 7886 2500
Contacts for the Bookbuild:
Jamie Campbell (Specialist Sales): 020 7886 2736
Tom Salvesen (Corporate Broking): 020 7886 2904
JSE Designated Adviser
Sasfin Capital (a division of Sasfin Bank Limited)
Megan Young
Tel: +27 11 445 8068
SA Corporate Adviser
Qinisele Resources Proprietary Limited
Dennis Tucker / Andrew Brady
Tel: +27 11 883 6358
Important Information
This Announcement contains (or may contain) certain
forward-looking statements with respect to certain of the Company's
plans and its current goals and expectations relating to its future
financial condition and performance and which involve a number of
risks and uncertainties. The Company cautions readers that no
forward-looking statement is a guarantee of future performance and
that actual results could differ materially from those contained in
the forward-looking statements. These forward-looking statements
can be identified by the fact that they do not relate only to
historical or current facts. Forward-looking statements sometimes
use words such as "aim", "anticipate", "target", "expect",
"estimate", "intend", "plan", "goal", "believe", or other words of
similar meaning. By their nature, forward-looking statements
involve risk and uncertainty because they relate to future events
and circumstances, including, but not limited to, economic and
business conditions, the effects of continued volatility in credit
markets, market-related risks such as changes in the price of
commodities or changes in interest rates and foreign exchange
rates, the policies and actions of governmental and regulatory
authorities, changes in legislation, the further development of
standards and interpretations under International Financial
Reporting Standards ("IFRS") applicable to past, current and future
periods, evolving practices with regard to the interpretation and
application of standards under IFRS, the outcome of pending and
future litigation or regulatory investigations, the success of
future explorations, acquisitions and other strategic transactions
and the impact of competition. A number of these factors are beyond
the Company's control. As a result, the Company's actual future
results may differ materially from the plans, goals, and
expectations set forth in
the Company's forward-looking statements. Any forward-looking
statements made in this Announcement by or on behalf of the Company
speak only as of the date they are made. Except as required by the
Financial Conduct Authority (the "FCA"), the London Stock Exchange
or applicable law, the Company expressly disclaims any obligation
or undertaking to release publicly any updates or revisions to any
forward-looking statements contained in this Announcement to
reflect any changes in the Company's expectations with regard
thereto or any changes in events, conditions or circumstances on
which any such statement is based.
This Announcement is for information purposes only and shall not
constitute an offer to buy, sell, issue, or subscribe for, or the
solicitation of an offer to buy, sell, issue, or subscribe for any
securities, nor shall there be any sale of securities in any
jurisdiction in which such offer, solicitation or sale would be
unlawful prior to registration or qualification under the
securities laws of any such jurisdiction.
This Announcement does not contain an offer or constitute any
part of an offer to the public within the meaning of Sections 85
and 102B of the Financial Services and Markets Act 2000, as amended
("FSMA") or otherwise. This Announcement is not an "approved
prospectus" within the meaning of Section 85(7) of FSMA and a copy
of it has not been, and will not be, delivered to the FCA in
accordance with the Prospectus Rules or delivered to any other
authority which could be a competent authority for the purpose of
the Prospectus Directive. Its contents have not been examined or
approved by the London Stock Exchange plc, nor has it been approved
by an "authorised person" for the purposes of Section 21 of
FSMA.
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
Panmure Gordon or by any of its 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.
Panmure Gordon, which is authorised and regulated in the United
Kingdom by the FCA, is acting as placing agent for the Company and
for no-one else in connection with the Placing, and Panmure Gordon
will not be responsible to anyone other than the Company for
providing the protections afforded to its customers or for
providing advice to any other person in relation to the Placing or
any other matter referred to herein.
The distribution of this Announcement and the offering of the
Placing Shares with Warrants in certain jurisdictions may be
restricted by law. No action has been taken by the Company or
Panmure Gordon 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 to
inform themselves about, and to observe such restrictions.
This Announcement, including the Appendix, is not for
distribution or dissemination, directly or indirectly, in or into
the United States or any jurisdiction into which the same would be
unlawful. No public offering of securities of the Company will be
made in connection with the Placing in the United Kingdom, the
United States, the EEA, Switzerland or elsewhere.
This Announcement is not intended to constitute an offer or
solicitation to purchase or invest in the Placing Shares.
Persons (including, without limitation, nominees and trustees)
who have a contractual or other legal obligation to forward a copy
of the Appendix or this Announcement should seek appropriate advice
before taking any action.
The Placing Shares to which this Announcement relates may be
illiquid and / or subject to restrictions on their resale.
Prospective purchasers of the Placing Shares should conduct their
own due diligence on the Placing Shares. If you do not understand
the contents of this Announcement or its Appendix you should
consult an authorised financial adviser.
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, dissemination,
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 United States Securities Act of 1933 (as
amended) ("US Securities Act") or the applicable laws of other
jurisdictions.
Neither the content of the Company's website nor any website
accessible by hyperlinks on the Company's website is incorporated
in, or forms part of, this Announcement.
Appendix I: Terms and Conditions of the Placing
IMPORTANT INFORMATION FOR PLACEES ONLY REGARDING THE
PLACING.
THIS ANNOUNCEMENT, INCLUDING THIS APPIX (TOGETHER, THE
"ANNOUNCEMENT") AND THE INFORMATION CONTAINED HEREIN IS RESTRICTED
AND IS NOT FOR PUBLICATION, RELEASE OR DISTRIBUTION, DIRECTLY OR
INDIRECTLY, IN, INTO OR FROM THE UNITED STATES, CANADA OR ITS
TERRITORIES, AUSTRALIA, JAPAN, THE REPUBLIC OF IRELAND, OR ANY
JURISDICTION IN WHICH THE SAME WOULD BE UNLAWFUL. PERSONS INTO
WHOSE POSSESSION THIS ANNOUNCEMENT COMES ARE REQUIRED BY THE
COMPANY AND PANMURE GORDON TO INFORM THEMSELVES ABOUT AND TO
OBSERVE ANY SUCH RESTRICTIONS.
THIS ANNOUNCEMENT DOES NOT ITSELF CONSTITUTE AN OFFER OR
INVITATION TO UNDERWRITE AN OFFER FOR SALE OR SUBSCRIPTION OF ANY
SECURITIES IN THE COMPANY.
EACH PLACEE SHOULD CONSULT WITH ITS OWN ADVISERS AS TO LEGAL,
TAX, BUSINESS AND RELATED ASPECTS OF A SUBSCRIPTION FOR THE PLACING
SHARES.
Persons (including individuals, funds or otherwise) who have
chosen to participate in the Placing, by making an oral or written
offer to subscribe for Placing Shares will be deemed to have read
and understood the Announcement, including this Appendix in its
entirety and to be making such offer on the terms and conditions,
and to be providing the representations, warranties,
acknowledgements, and undertakings contained in this Appendix.
In this Appendix, unless the context otherwise requires,
"Placee" means a person (including individuals, funds or others) by
whom or on whose behalf a commitment to subscribe for Placing
Shares has been given. In particular, each such Placee represents,
warrants and acknowledges that:
1. it will acquire, hold, manage or dispose of any Placing
Shares with Warrants that are allocated to it for the purposes of
its business;
2. in the case of any Placing Shares with Warrants acquired by
it as a financial intermediary, as that term is used in Article
3(2) of the Prospectus Directive, (i) the Placing Shares with
Warrants acquired by it in the Placing have not been acquired on
behalf of, nor have they been acquired with a view to their offer
or resale to, persons in any Member State of the European Economic
Area which has implemented the Prospectus Directive other than
Qualified Investors or in circumstances in which the prior consent
of Panmure Gordon has been given to the offer or resale; or (ii)
where Placing Shares with Warrants have been acquired by it on
behalf of persons in any member state of the EEA other than
Qualified Investors, the offer of those Placing Shares with
Warrants to it is not treated under the Prospectus Directive as
having been made to such persons;
3. (a) (i) it is not in the United States and (ii) it is not
acting for the account or benefit of a person in the United States,
unless in the case of this clause (ii), it is acting with full
investment discretion for such person or, if such person is a
corporation or partnership, the person agreeing to purchase the
Placing Shares with Warrants is an employee of such person
authorised to make such purchase; (b) it is a dealer or other
professional fiduciary in the United States acting on a
discretionary basis for a non-US person (other than an estate or
trust) in reliance on Regulation S; (c) it is otherwise acquiring
the Placing Shares with Warrants in an "offshore transaction"
meeting the requirements of Regulation S under the US Securities
Act of 1933, as amended (the 'Securities Act"); or (d) it is a
"qualified institutional buyer" (a "QIB") (as defined in Rule 144A
under the Securities Act) and it has duly executed an investor
letter in a form provided to it and delivered the same to Panmure
Gordon or its affiliates;
4. it is acquiring the Placing Shares with Warrants for its own
account or is acquiring the Placing Shares with Warrants for an
account with respect to which it exercises sole investment
discretion and has the authority to make and does make the
representations, warranties, indemnities, acknowledgements and
agreements contained in this Announcement; and
5. it understands (or, if acting for the account of another
person, such person understands) the resale and transfer
restrictions set out in this Appendix.
The Company and Panmure Gordon will rely upon the truth and
accuracy of the foregoing representations, acknowledgements and
agreements.
Details of the Placing
Panmure Gordon has entered into an agreement with Diamondcorp
(the "Placing Agreement") under which, subject to the conditions
set out in that agreement, Panmure Gordon has agreed to use its
reasonable endeavours to procure subscribers for the Placing Shares
at the placing price that is to be determined as set out below with
certain institutional and other investors. Under the terms of the
Placing subscribers of Placing Shares will be allotted and issued
one Warrant for every Placing Share so subscribed. The Warrants are
exercisable into Ordinary Shares on a one for one basis at a price
of 1 pence each at any time during the period commencing on 1
November 2017 and expiring on 30 June 2019. The Warrants shall also
be exercisable at any time in the event of a change in control of
the Company. Panmure Gordon will receive professional fees pursuant
to both the Placing and in satisfaction of certain outstanding
indebtedness in the form of new Ordinary Shares at the Placing
Price and warrants on the same terms as the Warrants.
The Placing is conditional upon the Placing Agreement becoming
unconditional in all respects. The Placing is also conditional upon
entering into a labour agreement with AMCU on terms approved by
both the BRP, on behalf of LDM, and the Board of DiamondCorp.
The Placing Shares will, when issued, rank pari passu in all
respects with the existing issued Ordinary Shares, including the
right to receive dividends and other distributions declared, made
or paid following Admission.
Applications for admission
Applications will be made to the London Stock Exchange for
admission of the Placing Shares ("Admission") to AIM and to the
alternative exchange of the JSE. It is expected that Admission will
become effective on AIM at 8.00 a.m. on 25 January 2017. No
application will be made for admission of the Warrants to trading
on AIM or the alternative exchange of the JSE. The Company's
ordinary shares shall remain suspended on AIM and AltX until
further notice.
Participation in, and principal terms of, the Placing
Panmure Gordon is arranging the Placing as agent for and on
behalf of the Company. Participation in the Placing will only be
available to Placees who may lawfully be, and are, invited to
participate by Panmure Gordon.
The Placing Price and the number of Placing Shares with Warrants
to be issued will be agreed between Panmure Gordon and the Company
following completion of a bookbuilding exercise by Panmure Gordon
(the "Bookbuild"). The Placing Price and number of Placing Shares
with Warrants will be announced on a Regulatory Information Service
following the completion of the Bookbuild.
The Placees will also be allotted with one Warrant for every
Placing Share subscribed for. The Warrants are expected to be
exercisable at 1 pence at any time during the period commencing on
1 November and expiring on 30 June 2019. In addition, the Warrants
are expected to be exercisable at any time in the event of a change
in control of the Company. The Warrants will not be admitted to
trading on AIM, AltX or otherwise. The instrument constituting the
Warrants will contain customary limited anti-dilution provisions,
covering certain limited events such as, inter alia, sub-division
or consolidation of the Company's Ordinary Shares.
Panmure Gordon will determine in its absolute discretion the
extent of each Placee's participation in the Placing, which will
not necessarily be the same for each Placee and this will be
confirmed orally by Panmure Gordon as agent of the Company
("Confirmation"). No element of the Placing will be underwritten.
Confirmation will constitute an irrevocable legally binding
commitment upon that person (who will at that point become a
Placee) 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 (a copy of the terms and conditions having been provided
to the Placee prior to or at the same time as such oral
confirmation) and in accordance with the Company's articles of
association. For the avoidance of doubt, the Confirmation
constitutes each Placee's irrevocable legally binding agreement,
subject to the Placing Agreement not having been terminated, to pay
the aggregate settlement amount for the Placing Shares to be
subscribed for by that Placee regardless of the total number of
Placing Shares (if any) subscribed for by any other
investor(s).
Panmure Gordon reserves the right to scale back the number of
Placing Shares to be subscribed by any Placee in the event of an
oversubscription under the Placing. Panmure Gordon also reserves
the right not to accept offers for Placing Shares or to accept such
offers in part rather than in whole.
Each Placee will be required to pay to Panmure Gordon, on the
Company's behalf, the Placing Price for each Placing Share agreed
to be acquired by it under the Placing in accordance with the terms
set out herein. Each Placee's obligation to acquire and pay for
Placing Shares under the Placing will be owed to Panmure Gordon and
the Company. Each Placee has an immediate, separate, irrevocable
and binding obligation, owed to Panmure Gordon, to pay to it (or as
it may direct) in cleared funds an amount equal to the product of
the Placing Price and the number of Placing Shares for which such
Placee has agreed to subscribe. Each Placee will be deemed to have
read and understood the Appendix in its entirety, to the
participating in the Placing upon the terms and conditions
contained in the Appendix, and to be providing the representations,
warranties, agreements, acknowledgements and undertakings, in each
case as contained in the Appendix. To the fullest extent permitted
by law and applicable Financial Conduct Authority ("FCA") rules
(the "FCA Rules"), (i) neither Panmure Gordon, (ii) nor any of its
directors, officers, employees or consultants, nor (iii) to the
extent not contained within (i) or (ii), any person connected with
Panmure Gordon as defined in the FCA Rules ((i), (ii) and (iii)
being together "affiliates" and individually an "affiliate"), shall
have any liability to Placees or to any person other than the
Company in respect of the Placing.
Irrespective of the time at which a Placee's participation in
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".
Completion of the Placing will be subject to the 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 under "Termination of the Placing Agreement". In the event
that the Placing Agreement does not become unconditional in any
respect or is terminated, the Placing (save to the extent already
completed) will not proceed and all funds delivered by the Placee
to Panmure Gordon in respect of the Placee's participation will be
returned to the Placee at the Placee's risk without interest, (save
where Placing Shares have been validly issued to Placees).
By participating in the Placing, each Placee agrees that its
rights and obligations in respect of the Placing will terminate
only in the circumstances described below and will not otherwise be
capable of rescission or termination by the Placee.
By participating in the Placing, each Placee is deemed to have
read and understood this Announcement, including this Appendix, in
its entirety and to be making such offer on the terms and
conditions, and to be providing the representations, warranties,
acknowledgements, and undertakings contained in the Appendix.
To the fullest extent permissible by law, neither the Company,
Panmure Gordon 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 Panmure Gordon nor any
of its affiliates shall have any liability (including to the extent
permissible by law, any fiduciary duties) in respect of Panmure
Gordon's conduct of the Bookbuild or of such alternative method of
effecting the Placing as Panmure Gordon and the Company may
agree.
Conditions of the Placing
The obligations of Panmure Gordon under the Placing Agreement in
respect of the Placing Shares and Warrants are conditional on,
amongst other things:
(a) the Company having complied with its obligations under the
Placing Agreement (to the extent that such obligations fall to be
performed prior to Admission);
(b) the Company entering into a labour agreement with the AMCU
that is approved by both the BRP, on behalf of LDM, and the Board
of DiamondCorp; and
(c) Admission having occurred not later than 8.00 a.m. 25
January 2017 or such later date as the Company and Panmure Gordon
may agree, but in any event not later than 8.00 a.m. on 31 January
2017.
If (i) any of the conditions contained in the Placing Agreement
in relation to the Placing Shares are not fulfilled or waived by
Panmure Gordon by the respective time or date where specified, (ii)
any of such conditions becomes incapable of being fulfilled or
(iii) the Placing Agreement is terminated in the circumstances
specified below, the Placing will not proceed and the Placee's
rights and obligations hereunder in relation to the Placing Shares
with Warrants shall cease and terminate at such time and each
Placee agrees that no claim can be made by the Placee in respect
thereof.
Panmure Gordon, at its discretion and upon such terms as it
thinks fit, may 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. Any such extension or waiver
will not affect Placees' commitments as set out in this
Announcement.
Neither Panmure Gordon, the Company nor 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 Panmure
Gordon.
Termination of the Placing Agreement
Panmure Gordon is entitled (but after, where practicable, having
consulted with the Company) at any time before Admission, to
terminate the Placing Agreement in relation to its obligations in
respect of the Placing Shares with Warrants (save to the extent
already performed) by giving notice to the Company if, amongst
other things:
(a) the Company fails, in any material respect, to comply with
any of its obligations under the Placing Agreement; or
(b) any of the warranties given by the Company in the Placing
Agreement was untrue, inaccurate or misleading in any material
respect when made or has ceased to be true and accurate in a
material respect or has become misleading in a material respect by
reference to the facts and circumstances then subsisting; or
(c) an event of force majeure occurs or there is a material
adverse change in the financial position and/or prospects of the
Company or any member of the Group.
Upon such termination, the parties to the Placing Agreement
shall be released and discharged (except for any liability arising
before or in relation to such termination and save to the extent
already performed) from their respective obligations under or
pursuant to the Placing Agreement subject to certain
exceptions.
By participating in the Placing, the Placees agree that the
exercise by Panmure Gordon of any right of termination or other
discretion under the Placing Agreement shall be within the absolute
discretion of Panmure Gordon and that it need not make any
reference to the Placees and that it shall have no liability to the
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 FCA or submitted to the
London Stock Exchange in relation to the Placing and the Placees'
commitments will be made solely on the basis of the information
contained in this Announcement (including the Appendix) released by
the Company today.
Each Placee, by accepting and participating in the Placing,
agrees that the content of this Announcement (including the
Appendix) is exclusively the responsibility of the Company and
confirms that it has neither received nor relied on any other
information, representation, warranty, or statement made by or on
behalf of the Company, Panmure Gordon or any other person and
neither Panmure Gordon nor 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
Company in accepting a participation in the Placing. Nothing in
this paragraph shall exclude the liability of any person for
fraudulent misrepresentation.
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 the opinion of Panmure Gordon,
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.
The Warrants will not be admitted to CREST and will be issued in
certificated form. Certificates will be posted to Placees shortly
after Admission.
Participation in the Placing is only available to persons who
are invited to participate in it by Panmure Gordon.
A Placee's commitment to acquire a fixed number of Placing
Shares with Warrants under the Placing will be agreed orally with
Panmure Gordon and a contract note will be despatched as soon as
possible thereafter. Such agreement will constitute a legally
binding commitment on such Placee's part to acquire that number of
Placing Shares at the Placing Price on the terms and conditions set
out or referred to in the Appendix and subject to the Company's
Articles of Association.
Following the close of the Bookbuild, each Placee allocated
Placing Shares in the Placing will be sent trade confirmations in
accordance with the standing arrangements in place with Panmure
Gordon, stating the number of Placing Shares allocated to it at the
Placing Price and the number and key terms of the Warrants, the
aggregate amount owed by such Placee to Panmure Gordon 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 Panmure Gordon. Settlement should be through
Panmure Gordon against CREST ID: 83801. For the avoidance of doubt,
it is anticipated that Placing allocations will be booked with a
trade date of 19 January 2017 and settlement date of 25 January
2017.
The Company will deliver the Placing Shares to the CREST
accounts operated by Panmure Gordon as agent for the Company and
Panmure Gordon 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 relevant Placing
Shares to that Placee against payment. The Placing Shares will be
held as nominee for the relevant Placee.
It is expected that settlement of the Placing Shares will take
place on 25 January 2017, on a delivery versus payment basis.
The Company will deliver certificates for the Warrants to
Placees in accordance with the certificated settlement instructions
that each Placee has in place with Panmure Gordon.
Interest is chargeable daily on payments not received from the
Placees on the due date in accordance with the arrangements set out
above at the rate of four per cent. per annum above the base
lending rate of the Bank of England, as determined by Panmure
Gordon.
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 and Warrants 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 and Warrants on such Placee's
behalf.
If Placing Shares and Warrants 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 and
Warrants 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 and
Warrants 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
References in these Representations and Warranties to "Placing
Shares" shall be deemed to include the Warrants as the context may
require.
By participating in the Placing, each Placee (and any person
acting on such Placee's behalf) acknowledges, undertakes,
represents, warrants and agrees (as the case may be) with Panmure
Gordon and the Company, in each case as a fundamental term of their
application for Placing Shares, the following:
That it:
1. represents and warrants that it has read this Announcement,
including the Appendix, in its entirety and that its acquisition of
Placing Shares is subject to and based upon all the terms,
conditions, representations, warranties, acknowledgements,
agreements and undertakings and other information contained herein
and undertakes not to redistribute or duplicate this
Announcement;
2. acknowledges that it has received this Announcement solely
for its use and has not redistributed or duplicated it;
3. acknowledges and agrees that no offering document, prospectus
or admission document has been or will be prepared in connection
with the Placing and represents and warrants that it has not
received a prospectus, admission document or other offering
document in connection with the Placing or the Placing Shares;
4. acknowledges that its participation in the Placing shall also
be subject to the provisions of the Placing Agreement and the
memorandum and articles of association of the Company in force both
before and immediately after Admission;
5. acknowledges that the ordinary shares in the capital of the
Company are admitted to trading on AIM and on the alternative
exchange of the JSE, and the Company is therefore required to
publish certain business and financial information in accordance
with the rules and practices of AIM and the JSE (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 such Exchange Information without undue difficulty and is
able to obtain access to such information or comparable information
concerning any other publicly traded company without undue
difficulty;
6. acknowledges that neither Panmure Gordon nor the Company nor
any of their respective affiliates or 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 Company other than
this Announcement; nor has it requested any of Panmure Gordon, the
Company, any of their respective affiliates or any person acting on
behalf of any of them to provide it with any such information;
7. acknowledges that the content of this Announcement is
exclusively the responsibility of the Company and that neither
Panmure Gordon 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 Panmure Gordon or the Company or
their respective affiliates and neither Panmure Gordon nor the
Company nor their respective affiliates 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 Company in deciding to participate in the
Placing;
8. represents and warrants that it has neither received nor
relied on any inside information (as defined in section 118C of the
Financial Services and Markets Act 2000, as amended ("FSMA"))
concerning the Company in accepting this invitation to participate
in the Placing;
9. acknowledges that neither Panmure Gordon nor any person
acting on its behalf nor any of their respective affiliates has or
shall have any liability for any publicly available or filed
information, or any representation relating to the Company,
provided that nothing in this paragraph excludes the liability of
any person for fraudulent misrepresentation made by that
person;
10. represents and warrants that it has complied with its
obligations under the Criminal Justice Act 1993, section 118 of
FSMA and in connection with money laundering and terrorist
financing under the Proceeds of Crime Act 2002, the Terrorism Act
2000 (as amended), the Terrorism Act 2006, the Money Laundering
Regulations 2007 and MAR (the "Regulations") and any related or
similar rules, regulations or guidelines, issued, administered or
enforced by any government agency having jurisdiction in respect
thereof and the Money Laundering Sourcebook of the FCA 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;
11. if a financial intermediary, as that term is used in Article
3(2) of EU Directive 2003/71/EC, as amended (the "Prospectus
Directive") (including any relevant implementing measure in any
member state), represents and warrants that the Placing Shares
subscribed for by it in the 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 Panmure Gordon has been given to the
proposed offer or resale;
12. represents and warrants that it has not offered or sold and
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 FSMA;
13. represents and warrants 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;
14. represents and warrants 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;
15. represents and warrants 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;
16. represents and warrants that 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, as
amended, or is a person to whom this Announcement may otherwise be
lawfully communicated;
17. acknowledges that any offer of Placing Shares may only be
directed at persons in member states of the European Economic Area
who are "qualified investors" within the meaning of Article 2(1)(e)
of the Prospectus Directive and represents and agrees that it is
such a qualified investor;
18. represents and warrants that it and any person acting on its
behalf is entitled to subscribe for Placing Shares under the laws
of all relevant jurisdictions which apply to it 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
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 that its subscription 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.
19. acknowledges and agrees that the Placing Shares have not
been and will not be registered under the Securities Act or with
any securities regulatory authority of any state or jurisdiction of
the United States, or the relevant Canadian, Japanese, Australian
or Irish securities legislation and therefore the Placing Shares
may not be offered, sold, transferred or delivered directly or
indirectly into the United States, Canada, Japan, Australia or the
Republic of Ireland or their respective territories and
possessions, except subject to limited exemptions;
20. warrants that it has complied with all relevant laws of all
relevant territories, obtained all requisite governmental or other
consents which may be required in connection with the Placing
Shares, complied with all requisite formalities and that it has not
taken any action or omitted to take any action which will or may
result in Panmure Gordon, the Company or any of their respective
directors, officers, agents, employees or advisers acting in breach
of the legal or regulatory requirements of any territory in
connection with the Placing;
21. acknowledges and agrees that its purchase of Placing Shares
does not trigger, in the jurisdiction in which it is resident or
located: (i) any obligation to prepare or file a prospectus or
similar document or any other report with respect to such purchase;
(ii) any disclosure or reporting obligation of the Company; or
(iii) any registration or other obligation on the part of the
Company;
22. undertakes 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 Panmure Gordon may in its
discretion determine and without liability to such Placee;
23. acknowledges that neither Panmure Gordon nor any of its
affiliates, nor any person acting on behalf of any of them, is
making any recommendations to it, advising it regarding the
suitability of any transactions it may enter into in connection
with the Placing and that participation in the Placing is on the
basis that it is not and will not be a client of Panmure Gordon for
the purposes of the Placing and that neither Panmure Gordon has no
duties or responsibilities to it for providing the protections
afforded to its clients or for providing advice in relation to the
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;
24. undertakes 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. Neither Panmure Gordon nor
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 Placing and it agrees to
indemnify the Company and Panmure Gordon in respect of the same on
the basis that the Placing Shares will be allotted to the CREST
stock account of Panmure Gordon who will hold them as nominee on
behalf of such Placee until settlement in accordance with its
standing settlement instructions;
25. acknowledges 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, Placing 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
or Panmure Gordon 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;
26. acknowledges that Panmure Gordon and its affiliates will
rely upon the truth and accuracy of the representations, warranties
and acknowledgements set forth herein and which are irrevocable and
it irrevocably authorises Panmure Gordon 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;
27. agrees to indemnify on an after tax basis and hold the
Company and Panmure Gordon 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 the Appendix and further agrees that
the provisions of the Appendix shall survive after completion of
the Placing;
28. represents and warrants that it will acquire any Placing
Shares subscribed for by it for its account or for one or more
accounts as to each of which it exercises sole investment Placing
discretion and it has full power to make the acknowledgements,
representations and agreements herein on behalf of each such
account;
29. acknowledges that its commitment to subscribe for Placing
Shares on the terms set out herein and in the relevant contract
notes will continue notwithstanding any amendment that may in
future be made to the terms of the Placing and that Placees will
have no right to be consulted or require that their consent be
obtained with respect to the Company's conduct of the Placing. The
foregoing representations, warranties and confirmations are given
for the benefit of the Company and Panmure Gordon. 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. Such agreement assumes,
and is based on a warranty from each Placee, that neither it, nor
the person specified by it for registration as 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). 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 of the Company, nor Panmure Gordon 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 Panmure Gordon
accordingly;
30. understands that no action has been or will be taken by any
of the Company, Panmure Gordon or any person acting on behalf of
the Company or Panmure Gordon 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;
31. in making any decision to subscribe for the Placing Shares,
confirms that it has knowledge and experience in financial,
business and international investment matters as is required to
evaluate the merits and risks of subscribing for 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 Placing.
It further confirms that it relied on its own examination and due
diligence of the Company and its associates taken as a whole, and
the terms of the Placing, including the merits and risks
involved;
32. represents and warrants that it has (a) made its own
assessment and satisfied itself concerning legal, regulatory, tax,
business and financial considerations in connection herewith to the
extent it deems necessary; (b) had access to review publicly
available information concerning the Company that it considers
necessary or appropriate and sufficient in making an investment
decision; (c) reviewed such information as it believes is necessary
or appropriate in connection with its subscription of the Placing
Shares; and (d) made its investment decision based upon its own
judgment, due diligence and analysis and not upon any view
expressed or information provided by or on behalf of Panmure
Gordon;
33. understands and agrees that it may not rely on any
investigation that Panmure Gordon or any person acting on its
behalf may or may not have conducted with respect to the Company,
or the Placing and Panmure Gordon has not made any representation
to it, express or implied, with respect to the merits of the
Placing, the subscription for the Placing Shares, or as to the
condition, financial or otherwise, of the Company, or as to any
other matter relating thereto, and nothing herein shall be
construed as a recommendation to it to subscribe for the Placing
Shares. It acknowledges and agrees that no information has been
prepared by Panmure Gordon for the purposes of this Placing;
34. accordingly it acknowledges and agrees that it will not hold
Panmure Gordon or any of its affiliates or any person acting on its
behalf responsible or liable for any misstatements in or omission
from any publicly available information relating to the Company or
information made available (whether in written or oral form) in
presentations or as part of roadshow discussions with investors
relating to the Company (the "Information") and that neither
Panmure Gordon nor any person acting on behalf of Panmure Gordon
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
35. understands that the Placing Shares have not been and will
not be, and no Ordinary Shares issued as a result of the exercise
of a Warrant will be registered under the Securities Act or with
any securities regulatory authority of any state or other
jurisdiction of the United States, and accordingly, may not be
offered or sold or otherwise transferred in the United States
except pursuant to a registration statement under the Securities
Act or an exemption from the registration requirements of the
Securities Act and, in connection with any such transfer, the
Company shall be provided, as a condition to transfer, with a legal
opinion of counsel, in form and by counsel reasonably satisfactory
to the Company, that no such Securities Act registration is or will
be required and with appropriate certifications by the transferee
as to appropriate matters.
The foregoing representations, warranties and confirmations are
given for the benefit of the Company and Panmure Gordon.
In addition, Placees should note that they will be liable for
any stamp duty and all other stamp, issue, securities, transfer,
registration, documentary or other duties or taxes (including any
interest, fines or penalties relating thereto) payable outside the
United Kingdom by them or any other person on the subscription by
them of any Placing Shares or the agreement by them to subscribe
for any Placing Shares.
Each Placee and any person acting on behalf of each Placee
acknowledges and agrees that either Panmure Gordon or any of its
affiliates may, at their absolute discretion, agree to become a
Placee in respect of some or all of the Placing Shares.
All times and dates in this Announcement may be subject to
amendment. Panmure Gordon shall notify the Placees and any person
acting on behalf of the Placees of any changes.
The past performance of the Company and its securities is not,
and should not be relied on as a guide to the future performance of
the Company and its securities. Persons needing advice should
consult an independent financial adviser.
Definitions
"Admission" admission of the Placing Shares
to AIM and such admission
becoming effective in accordance
with Rule 6 of the AIM Rules
for Companies;
"AIM" the AIM Market of the London
Stock Exchange plc;
"AIM Rules for Companies" the AIM Rules for Companies
and including, where applicable,
any guidance notes published
by the London Stock Exchange
from time to time;
"AltX" the Alternative Exchange of
the JSE;
"Announcement" this announcement in its entirety;
"Articles" the articles of association
of the Company in force on
the date hereof;
"Board" or "Directors" the directors of the Company,
or any duly authorised committee
thereof;
"Company" DiamondCorp plc;
"CREST" the computerised settlement
system (as defined in the
CREST Regulations) operated
by Euroclear which facilitates
the transfer of title to shares
in uncertificated form;
"CREST Regulations" the Uncertificated Securities
Regulations 2001 (SI 2001/3755)
including any enactment or
subordinate legislation which
amends or supersedes those
regulations and any applicable
rules made under those regulations
or any such enactment or subordinate
legislation for the time being
in force;
"Euroclear" Euroclear UK & Ireland Limited,
a company incorporated in
England & Wales with registered
number 02878738, being the
operator of CREST;
"FCA" the Financial Conduct Authority
in its capacity as the competent
authority for the purposes
of Part VI of FSMA;
"FSMA" the Financial Services and
Markets Act 2000 (as amended);
"Group" the Company together with
its subsidiaries from time
to time;
"JSE" the JSE Limited (registration
number 2005/022939/06), a
public company duly registered
and incorporated under the
company laws of South Africa,
licensed as an exchange under
the Financial Markets Act
2012;
"LDM" Lace Diamond Mine (Pty) Limited;
"London Stock Exchange" London Stock Exchange plc;
"Ordinary Shares" the ordinary shares of 0.1
pence each in the capital
of the Company;
"Panmure Gordon" Panmure Gordon (UK) Limited;
"Placing" the placing of the Placing
Shares each with one Warrant
attached at the Placing Price
pursuant to the terms of the
Placing Agreement;
"Placing Agreement" the conditional agreement
dated 13 January 2017 between
the Company and Panmure Gordon
relating to the Placing, further
details of which are set out
in this Announcement;
"Placing Price" the price at which the Placing
Shares are to be placed as
will be agreed between the
Company and Panmure Gordon;
"Placing Shares" the Placing Shares to be issued
by the Company and subscribed
for pursuant to the Placing;
"Prospectus Rules" the prospectus rules of the
FCA
"Regulation S" Regulation S as promulgated
under the Securities Act;
"Securities Act" the United States Securities
Act of 1933, as amended;
"Shareholders" holders of Ordinary Shares,
from time to time.
"UK" or "United Kingdom" the United Kingdom of Great
Britain and Northern Ireland;
"uncertificated" or "in recorded on the relevant register
uncertificated form" of the share or security concerned
as being held in uncertificated
form in CREST and title to
which, by virtue of the CREST
Regulations, may be transferred
by means of CREST;
"US" the United States of America,
its territories and possessions,
any state of the United States
of America and the district
of Columbia and all other
areas subject to its jurisdiction;
"US Person" bears the meaning ascribed
to such term by Regulation
S;
"US$" the lawful currency of the
US from time to time;
"Warrant" a warrant to subscribe for
one Ordinary Share exercisable
at an expected price of 1
pence during the period commencing
on 1 November 2017 and expiring
on 30 June 2019 on the terms
of a warrant instrument to
shortly be executed by the
Company;
"ZAR" the lawful currency of the
Republic of South Africa from
time to time; and
"GBP" pounds sterling, the lawful
currency of the UK from time
to time.
This information is provided by RNS
The company news service from the London Stock Exchange
END
MSCXXLFFDFFXBBE
(END) Dow Jones Newswires
January 13, 2017 08:37 ET (13:37 GMT)
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