Prospective investors and Shareholders should be aware that an
investment in the Company is speculative and involves a high degree
of risk. In addition to other information contained in this
Circular, the Directors consider the following risk factors are of
particular relevance to Shareholders in their consideration of how
to cast their vote at the General Meeting. It should be noted that
this list is not exhaustive and that other risk factors not
presently known or currently deemed immaterial may apply. The risks
set out below are not presented in any order of priority.
Shareholders in any doubt about the action they should take
should consult their stockbroker, bank manager, solicitor,
accountant or other independent financial adviser authorised under
FSMA if they are in the UK or, in the case of overseas investors,
another appropriately authorised financial adviser.
RISKS RELATED TO THE GREENSTONE PLACING NOT PROCEEDING
Shareholders should note the following risk factors related to
the Greenstone Placing not proceeding for any reason:
If the Resolution is not approved, the Greenstone Placing will
not proceed
If the Resolution is not approved, the Greenstone Placing will
not proceed. Without access to the funds from the Greenstone
Placing, the Company would immediately need to seek to secure
alternative sources of funds to enable it to fund its corporate
activities in the period immediately following the General Meeting.
The Independent Directors are unable to provide any assurance that
any alternative financing could immediately be secured or, that if
it were secured, it would be on terms as favourable to the Company
or would not result in a substantial dilution of Shareholders'
interests. If no funds were immediately available, it is highly
likely that the Company would cease to be able to trade, in which
circumstances it is unlikely that there would be any value
attributable to Shareholders. The Independent Directors have,
before entering negotiations with Greenstone, considered
alternative sources of financing (including both debt and equity
funding) and believe it is highly unlikely that the Company could
secure funding on as favourable terms on a timely basis in such
circumstances particularly given the recent downturn in commodity
prices. Even if financing were immediately available and the
Company were able to continue trading, the Independent Directors
believe that the circumstances of such financing could result in a
material adverse effect on the share price of the Company.
If the Greenstone Placing does not succeed, it is unlikely that
the proposed Open Offer and Placing will proceed
The Greenstone Placing provides, inter alia, for the proposed
Open Offer and Placing to be carried out by the Company to be
conditionally fully underwritten by Greenstone pursuant to the
Underwriting Facility. If the Greenstone Placing does not complete,
the Independent Directors believe that it is unlikely that the
Company would be able to attract sufficient support for the Open
Offer and the Placing from Qualifying Shareholders and third party
investors to raise the level of finance required as part of the
Phase One Fundraising to proceed with development of the Namib
Project (up to a construction decision, which would also be
dependent on the issue of the Mining Licence and Phase Two
Fundraising being achieved).
Alternative funding options are unlikely to be available
If the Resolution is not approved, the Independent Directors
believe that it is highly unlikely that the Company will be able to
secure appropriate financing on as favourable terms. Any
alternative equity solution would either require a "cash box
structure", for which the Company would not need shareholder
approval but in which the majority of existing Shareholders would
not be able to participate, or the Company would need to secure
further shareholder approval or prepare a prospectus and offer the
relevant equity securities to all Shareholders in all jurisdictions
in proportion to their existing holdings. The Independent Directors
do not consider seeking alternative shareholder approval or issuing
a prospectus would generate sufficient funds, quickly enough, to
secure the Company's survival in its present form, or at all. Due
to the time and costs involved in securing further shareholder
approval or preparing a prospectus and having the same approved by
the UK Listing Authority, and with the requirement to comply with
applicable securities law restrictions in other jurisdictions in
which shareholders are resident, this process would be
prohibitively expensive and time consuming for the Company given
current time constraints and cash resources. In addition, having
spoken to multiple parties, the Independent Directors are of the
view that debt finance is also becoming more difficult to obtain
particularly given the recent downturn in commodity prices.
The Greenstone Placing may not take place as planned even if the
Resolution is approved
Completion of the Greenstone Placing is subject to the
Conditions being waived or satisfied (described above). There can
be no assurance that completion of the Greenstone Placing will take
place under the Subscription Agreement, including if any of the
Conditions are not met. In the event that completion of the
Greenstone Placing does not take place for any reason, in full or
at all, the Company will be required to look for alternative
sources of funding, which cannot be guaranteed to be available on
the same terms or at all.
Impact on Group's financial resilience
If the Greenstone Placing does not proceed, the Group will have
less financial flexibility particularly in the event of any
significant deterioration in market conditions and will have to
consider alternative funding options which may not be as
favourable. In the event the Greenstone Placing is not completed,
and no alternative sources of funds become available, the Company
will likely be in financial distress, and will, in all likelihood,
have to cease work on the Namib Project and continue on a care and
maintenance basis and/or consider liquidation.
RISKS ASSOCIATED WITH THE GREENSTONE PLACING PROCEEDING
If the Greenstone Placing does complete, Shareholders should
note the following risk factors:
Possible requirement for Greenstone to make a Mandatory Offer
for the Company
Even if the Resolution is approved, Greenstone is not seeking a
waiver from the Panel (and approval of such waiver from the
independent Shareholders of the Company) of the requirement to make
a Mandatory Offer on any increase to Greenstone's percentage
shareholding of the then Issued Share Capital to 30 per cent. or
more.
As such, if Greenstone increases its shareholding to 30 per
cent. or more of the then Issued Share Capital, it will be required
to make a Mandatory Offer for the Company at the highest price paid
by Greenstone (or any party with whom it is acting in concert) for
any interest in Ordinary Shares in the previous 12 month
period.
If the Greenstone Placing proceeds, Greenstone will continue to
own approximately 29.48 per cent. of the Issued Share Capital and
will have the ability to increase its shareholding on any
conversion of the Tranche One Notes. Pursuant to the terms of the
Subscription Agreement and Convertible Loan Note Instrument, the
Tranche One Notes will, either in full or in part, convert
automatically into new Ordinary Shares on completion of the
proposed Open Offer and Placing, but only so far as will not cause
Greenstone's shareholding to exceed 29.99 per cent. of the then
Issued Share Capital.
However, Greenstone may, subject to completion of the Greenstone
Placing, at its discretion, convert all of the Tranche One Notes at
the Conversion Price and trigger a Mandatory Offer for the Company
at the highest price paid by Greenstone (or any party with whom it
is acting in concert) for any interest in Ordinary Shares in the
previous 12 month period.
Depending on the level of acceptances received under the
proposed Open Offer, participation in the proposed Placing by third
party investors and satisfaction or waiver of the Conditions,
Greenstone may, pursuant to the Underwriting Facility, be required
to subscribe for the Underwriting Loan Notes in addition to the
Tranche One Notes (up to a total amount of US$4.0 million).
Further, the Company may be required to issue additional
Convertible Loan Notes to settle unpaid interest, which could
amount to up to approximately US$1.2 million (ignoring any possible
grossing up for withholding tax) of additional Convertible Loan
Notes if no interest were paid (and more if they continue unpaid
after the expected final repayment date).
If the Underwriting Facility is used, or further Convertible
Loan Notes are issued in respect of unpaid interest, Greenstone
may, at its discretion, convert the Tranche One Notes and the
Underwriting Loan Notes and any such further Convertible Loan Notes
and trigger a Mandatory Offer for the Company at the highest price
paid by Greenstone (or any party with whom it is acting in concert)
for any interest in Ordinary Shares in the previous 12 month period
(although it should be noted that it would be for the Shareholders
to decide at the relevant time whether to accept or reject such
offer, depending on the offer price, the then prevailing price per
Ordinary Share and other relevant circumstances at that time).
It should be noted that the Convertible Loan Notes are freely
transferable, and so the above analysis may, also, depending on the
relevant holding of interests in Ordinary Shares of any transferee
to whom Greenstone transfers Convertible Loan Notes, apply to such
transferee.
As at the date of this announcement, Greenstone has not
indicated any intention to trigger a Mandatory Offer.
Influence of significant Shareholder and Relationship
Agreement
North River (LSE:NRRP)
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De Dic 2024 a Ene 2025
North River (LSE:NRRP)
Gráfica de Acción Histórica
De Ene 2024 a Ene 2025
