Pre-Annual General Meeting Information • Mar 16, 2012
Pre-Annual General Meeting Information
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THIS DOCUMENT IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION. If you are in any doubt about the contents of this document or the action you should take, you are recommended to seek immediately your own independent financial advice from your stockbroker, bank manager, solicitor, accountant or other appropriate independent financial adviser who is authorised under the Financial Services and Markets Act 2000, if you are resident in the United Kingdom, or, if not, from another appropriately authorised independent financial adviser.
If you have sold or otherwise transferred all of your Ordinary Shares, please forward this document, together with the accompanying Form of Proxy, at once to the purchaser or transferee or to the stockbroker, banker or other agent through whom the sale or transfer was effected for onward transmission to the purchaser or transferee. Such documents should not, however, be forwarded or transmitted in or into any jurisdiction in which such act would constitute a violation of the relevant laws in such jurisdiction. If you have sold or transferred only part of your holding of Ordinary Shares, you should retain these documents and contact your stockbroker, bank or other agent through whom the sale or transfer was effected immediately.
This document should be read in conjunction with the accompanying Form of Proxy and the definitions set out in Part VI of this document. The whole of this document should be read and, in particular, your attention is drawn to the letter from the Chairman of Bisichi which is set out in Part I of this document and which contains the unanimous recommendation of the Directors to Shareholders to vote in favour of the Resolution to be proposed at the General Meeting referred to below.
Notice of General Meeting
The General Meeting to consider the Resolution will be held at the Royal Automobile Club, 89 Pall Mall, London SW1Y 5LP on 3 April 2012 at 11 a.m. The notice convening the General Meeting, is set out on pages 29 to 31 at the end of this document. The action to be taken in respect of the General Meeting is set out in the letter from the Chairman of Bisichi Mining Plc contained in Part I of this document. Whether or not you intend to be present at the meeting, it is important that you complete, sign and return the Form of Proxy in accordance with the instructions printed thereon to the Company's registrars at Capita Registrars, PXS, 34 Beckenham Road, Beckenham, Kent BR3 4TU as soon as possible but, in any event, so as to arrive no later than 11 a.m. on 30 March 2012. Alternatively you may submit your proxy online at www.capitashareportal.com. The completion and return of the Form of Proxy will not preclude you from attending the General Meeting and voting in person should you wish to do so.
If you have any questions about this document or the General Meeting, or are in any doubt as to how to complete the Form of Proxy, please call Capita Registrars' helpline on 0871 664 0300 (Calls cost 10 pence per minute plus network extras). Lines are open Monday to Friday between 9:00 a.m. and 5:00 p.m. (from outside the UK: +44 20 8639 3999). Please note that calls may be monitored or recorded and the representatives cannot provide financial advice or advice on the merits of the Resolution.
For a discussion of certain risk factors which should be taken into account when considering what action you should take in connection with the General Meeting, please see Part II "Risk Factors" of this document.
Certain information in relation to the Group has been incorporated by reference into this document. You should refer to the section of this document headed 'Relevant Documentation'.
Shore Capital, which is authorised and regulated in the UK by the FSA, is acting exclusively for Bisichi and no-one else in connection with the Disposal and will not be responsible to any other person other than Bisichi for providing the protections afforded to its respective clients nor for providing advice in relation to the Disposal or any other transaction, arrangement or other matter referred to in this document.
| Page | ||
|---|---|---|
| EXPECTED TIMETABLE OF PRINCIPAL EVENTS | 3 | |
| RELEVANT INFORMATION | 4 | |
| FORWARD-LOOKING STATEMENTS | 5 | |
| PART I | LETTER FROM THE CHAIRMAN | 6 |
| PART II | RISK FACTORS | 11 |
| PART III | PRINCIPAL TERMS OF THE DISPOSAL | 13 |
| PART IV | FINANCIAL INFORMATION | 15 |
| PART V | ADDITIONAL INFORMATION | 19 |
| PART VI | DEFINITIONS | 25 |
| NOTICE OF GENERAL MEETING | 29 |
| Publication of this Circular | 16 March 2012 |
|---|---|
| Latest time and date for receipt of proxies | 11.00 a.m. on 30 March 2012 |
| Voting record date | 30 March 2012 |
| General Meeting | 11.00 a.m. on 3 April 2012 |
| Estimated date of Completion | 15 May 2012 |
| ZAR:GBP of 0.084 (exchange rate as at 14 March 2012) |
The following sections of the Annual Reports and Accounts are incorporated by reference into this document so as to provide the information required in respect of related party transactions pursuant to paragraph 19 of Annex 1 of the Prospectus Rules (as incorporated by chapter 13 Annex 1R of the Listing Rules):
| Information incorporated by reference into this document |
Destination of incorporation | Page number in this document |
|---|---|---|
| Annual Report and Accounts 2010 (Financial Statements page 49 inclusive) – Note 27 (Related Parties) to the consolidated financial statements of Bisichi for the financial year ended 31 December 2010 |
Paragraph 6 of Part V | 21 |
| Annual Report and Accounts 2009 (Financial Statements pages 48 to 49 inclusive) – Note 26 (Related Parties) to the consolidated financial statements of Bisichi for the financial year ended 31 December 2009 |
Paragraph 6 of Part V | 21 |
| Annual Report and Accounts 2008 (Financial Statements page 48 inclusive) – Note 28 (Related Parties) to the consolidated financial statements of Bisichi for the financial year ended 31 December 2008 |
Paragraph 6 of Part V | 21 |
Copies of the above documents are available:-
Any information that is itself incorporated by reference in the above documents is not incorporated by reference in this document.
This document and the information incorporated by reference includes statements concerning the Continuing Group that are forward-looking in nature. Words such as believe, anticipate, estimate, target, potential, expect, intend, predict, project, could, should, may, will, plan, aim, seek and similar expressions are intended to identify forward-looking statements but are not the exhaustive means of identifying such statements.
Forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of the Continuing Group, or the industry in which the Continuing Group operates, to be materially different from any future results, predictions, forecasts, performance or achievements expressed or implied by such forward-looking statements. Shareholders should be aware that a number of important factors could cause actual results to differ materially from the plans, objectives, expectations, estimates and intentions expressed in such forward-looking statements. These forward-looking statements are further qualified by the risk factors described in the section entitled 'Risk Factors' in Part II of this document.
The forward-looking statements contained in this document and the information incorporated by reference speak only as at the date of this document. Subject to the requirements of the DTRs, the Listing Rules or any other applicable law or regulation, Bisichi undertakes no obligation to publicly release the result of any revisions or updates to any forward-looking statements in this document and the information incorporated by reference that may occur due to any change in the Company's expectations or to reflect events or circumstances after the date of this document and the information incorporated by reference.
Shareholders should note that the contents of these paragraphs relating to forward-looking statements do not qualify the statements made as to sufficiency of working capital in paragraph 9 of Part V.
(Incorporated and registered in England and Wales No. 00112155)
Michael Heller (Executive Chairman) 30-35 Pall Mall Andrew Heller (Managing Director) London Garrett Casey (Finance Director) SW1Y 5LP Robert Grobler (Director of Mining) Christopher Joll (Non-Executive Director) John Sibbald (Non-Executive Director)
Directors Registered Office
16 March 2012
Dear Shareholder
Bisichi Mining Plc, a mining company with direct coal mining operations in South Africa, announced on 26 January 2012 that it had conditionally entered into the Disposal Agreement for the sale of its 49 per cent. shareholding in Ezimbokodweni and any claims which it has against Ezimbokodweni to Hasty Shelf Trade and Invest 17 (Proprietary) Limited ("HSTI" or "Purchaser") for a cash consideration of ZAR 54.2 million.
The proceeds of the Disposal will primarily be used for the repayment of the Intercompany Loan (plus accrued interest) and the further development of the Company's business, however, at the date of this document, the Company has not identified any specific opportunities.
Due to the level of consideration, the Disposal is classified as a Class 1 Transaction under Chapter 10 of the Listing Rules. As such, the Disposal requires the approval of Shareholders at a General Meeting to be held at the Royal Automobile Club, 89 Pall Mall, London SW1Y 5LP, on 3 April 2012 at 11 a.m. The Notice is set out at the end of this document.
This document sets out the background to, and details of, the Disposal and the Resolution to be proposed at the General Meeting and explains why the Board considers the Disposal to be in the best interests of the Company and its Shareholders as a whole. The Board unanimously recommends that you vote in favour of the Resolution to approve the Disposal, as the Directors intend to do so in respect of their beneficial shareholdings in the Company.
Ezimbokodweni is a South African registered joint venture company in which Bisichi has a 49 per cent. shareholding, with Endulwini Coal Limited ("Endulwini") holding the remaining 51 per cent.
In 2005 Ezimbokodweni entered into an agreement with BHP Billiton Energy Coal South Africa Limited ("BECSA") pursuant to which Ezimbokodweni would purchase the prospecting and surface rights of the Pegasus Project, registered under deed of transfer number T80810/89 (as described in paragraph 3 below).
The Pegasus Project, which is currently owned by BECSA, is an undeveloped export quality thermal coal deposit located in the Witbank coalfield of Mpumalanga, South Africa. The reserve is located approximately 40 km from the Company's existing operations at the Black Wattle Colliery.
The Pegasus Project covers the following areas:
The agreement with BECSA was subject to the fulfilment of a number of conditions, including, inter alia, consent being granted by the South African Minister of Mineral Resources pursuant to Section 11 of the Mineral and Petroleum Resources Development Act, 28 of 2002 ("MPRDA").
At the time that Ezimbokodweni first entered into negotiations for the purchase of the Pegasus Project in 2005 (as described in paragraph 3 below) it carried out due diligence and was also provided with information in respect of the Pegasus Project by BECSA. The Company has received only limited information updates on the Pegasus Project since 2005. As a result of the termination of the Original Agreement by BECSA in 2007 (as described in paragraph 3 below), no further due diligence has been carried out by the Company since 2008 and the Board does not believe that any further substantial work has been carried out by BECSA since that time. The latest available information held by the Company dates back to May 2008 and is summarised below.
The Pegasus Project is a shallow coal deposit, comprising three coal seams, making it ideally suited to open cast mining. The site is accessible via a tar road which passes approximately 1km to the west of the reserve. It contains a measured resource of approximately 14.3 million tonnes. The resource is classified as low phosphorous, low sulphur which can be sold both domestically in South Africa and internationally. It has an anticipated life of mine of 8 years. At present BECSA has been granted and holds prospecting and surface rights to the Pegasus Project. Commencement of commercial coal production at the site would be subject, inter alia, to a successful application by the owner of the prospecting right for the granting of a Mining Right and accompanying environmental assessment reports. In terms of the BECSA Sale, written consent from the South African Minister of Mineral Resources is required for the transfer of the prospecting right from BECSA to Ezimbokodweni. The BECSA Sale is therefore conditional upon such consent being obtained. The Disposal Agreement is conditional upon the fulfilment of all conditions that the BECSA Sale may be subject to.
The Pegasus Project is categorised as a measured coal resource based on the average drill spacing, correlation of data provided by drilling results and other technical/geological factors. The following resource statement has been taken from an evaluation of geological data based on boreholes drilled and provided by BECSA completed in May 2008. The evaluation was compiled by Gerhard Mulder, a Member of the Geological Society of South Africa and in accordance with the guidelines set out in the SAMREC Code.
| Total | 15,918,078 | 14,326,259 | 13,609,956 | 8,407,244 | ||||
|---|---|---|---|---|---|---|---|---|
| No. 1 Seam | 1,559,475 | 2.79 | 1.50 | 6,526,407 | 5,873,756 | 5,580,078 | 75% | 3,892,104 |
| No. 2 Lower Seam | 1,332,231 | 4.36 | 1.50 | 8,719,652 | 7,847,686 | 7,455,302 | 57% | 3,952,055 |
| No. 2 Upper Seam | 323,448 | 1.27 | 1.63 | 672,019 | 604,817 | 574,576 | 98% | 563,085 |
| Resource | (m3 ) |
(m) | R.D. | Insitu Tons | (10%) | (5%) | Yield | Sales Tons |
| Measured | by Coal | Thickness | Raw Coal | Gross | Insitu Tons | ROM Tons | Lab | Potential |
| underlain | Seam | Average | Mineable | Potential | ||||
| Area | Average |
On 21 April 2005, Ezimbokodweni entered into an agreement with Ingwe Collieries (Pty) Limited, a wholly-owned subsidiary of BECSA, for the purchase of the Pegasus Project (the "Original Agreement"). As a condition of the Original Agreement, Ezimbokodweni was required to produce certain financial guarantees. However, Bisichi's joint venture partner, Endulwini, was unable to provide its proportion of the guarantees and, as a consequence, the Original Agreement was terminated by BECSA in 2007.
Despite extensive negotiations, the Company was unable to resolve the situation, such that in 2010 the South African Department of Mineral Resources ("DMR") became involved to facilitate further negotiations between the parties. As a result of the DMR's intervention a new agreement was entered into between Bisichi and Endulwini (the "New Agreement"). Under the terms of the New Agreement, one of the two shareholders was required to sell their shareholding to the other with the remaining shareholder subsequently concluding a new contract with BECSA to purchase the Pegasus Project on terms to be agreed by that shareholder. Bisichi agreed to be the shareholder to dispose of its shareholding.
Consequently it was agreed that HSTI rather than Endulwini would purchase the Ezimbokodweni Shares, and in June 2011 the Disposal Agreement was entered into between, inter alia, the Company, HSTI and Ezimbokodweni. The consideration for the Disposal is ZAR54.2 million (approximately £4.55 million). The total consideration was derived upon as follows:
The carrying value of the Group's investment in Ezimbokodweni was approximately £1.8 million at 30 June 2011 (consisting of an outstanding loan to Ezimbokodweni of £1,134,000 and £682,000 representing the cost of its investment) and was included in the Company's consolidated balance sheet as part of investment in joint ventures within non-current assets. The investment will be written off as a result of the Disposal whilst the Intercompany Loan will be settled by the Company out of the proceeds from the sale, thus reducing investment in joint ventures by £1.8 million.
The consideration of ZAR54.2 million to be received by Bisichi pursuant to the Disposal represents a considerable premium to the current carrying value for the investment and is considered by the Directors to be a very positive outcome for the Company, particularly in light of the management time taken up by the negotiations and mediation process over the last 7 years. Furthermore, the investment in Ezimbokodweni has not generated any income for the Company over that period. The net proceeds from the Disposal, after the repayment of the Intercompany Loan, will strengthen Bisichi's balance sheet and allow the Company to invest in other future opportunities which have not yet been identified. It is believed that such opportunities will enable the Company to broaden its asset base and provide additional sources of income, thus reducing the Company's risk profile from the Shareholders' perspective.
In the absence of any other means by which to extract the Company from Ezimbokodweni and at the same time realising a positive return for the Company, the Board unanimously recommends that Shareholders vote in favour of the Resolution to approve the Disposal.
The consideration payable to the Company for the sale of its shares in Ezimbokodweni is ZAR54.2 million (£4.55 million) in cash, and the total costs associated with the transaction are estimated to be £208,000.
Ezimbokodweni incurred costs in connection with purchasing and furthering its mining rights in the three years ended 31 December 2008, 2009, 2010 or the six months ended 30 June 2011. However, these costs were all capitalised within current assets and accordingly no income statement is presented.
The Company has never received a dividend from Ezimbokodweni and, as such, the Disposal will increase cash by the level of net proceeds, but will not have any other effect on future cash flows.
The proceeds will be used for the further development of the Company, as yet not identified.
The carrying value of the Group's investment in Ezimbokodweni was approximately £1.8 million (ZAR 12.4 million) at 30 June 2011 (consisting of an outstanding loan due to Black Wattle, a subsidiary of Bisichi, by Ezimbokodweni of £1,134,000 and £682,000 representing the Company's cost of its investment) and was included in the Company's consolidated balance sheet as part of investment in joint ventures within non-current assets. The investment will be written off as a result of the Disposal whilst the Intercompany Loan will be settled by the Company out of the proceeds from the sale, thus reducing investment in joint ventures by £1.8 million.
The accounting profit on the Disposal before tax is estimated to be £2.5 million.
Of the proceeds of ZAR54.2 million, ZAR12.4 million will be paid to Black Wattle in settlement of the Intercompany Loan. This will have no impact on the Group's profit on the transaction (as shown above).
Further financial information on the Group's investment in Ezimbokodweni is shown in Part IV of this document.
Pursuant to the terms of the Disposal Agreement, HSTI will acquire the Sale Equity. The consideration payable to the Company in respect of the sale of the Sale Equity is ZAR54,200,000, payable in cash on the Payment Date.
The Company has effectively assumed liability for all amounts owing by Ezimbokodweni to Black Wattle, the Company's coal mining subsidiary operating in South Africa, thereby absolving Ezimbokodweni from its liability to Black Wattle. The Company has agreed to repay the Intercompany Loan (plus accrued interest) from the proceeds of the Purchase Price.
Under the terms of the Disposal Agreement, the Company will indemnify Ezimbokodweni against any claims which Black Wattle may have against Ezimbokodweni in relation to the Intercompany Loan. As at 31 December 2010, the date of the last audited financial statements of Black Wattle, the Intercompany Loan, amounting to ZAR12,387,534, remained outstanding. Pursuant to the Disposal Agreement, the Purchaser has provided certain warranties and representations in favour of the Company.
Completion of the Disposal Agreement is subject to, amongst other things:
The relevant conditions must be fulfilled by 15 May 2012 and as at the date of this document the condition set out in sub-paragraph (c) above has been fulfilled.
Pursuant to the terms of the Disposal Agreement there will be an approximate 30 day period between the transfer of the Ezimbokodweni Shares to HSTI, and the subsequent payment of the Purchase Price. Therefore, as security for payment of the Purchase Price by the Purchaser and the performance of the Purchaser's obligations under the Disposal Agreement, the HSTI Parties and the Purchaser have provided the Pledges (comprising a pledge and cession of certain shares and related claims which are more fully described in paragraphs 7.1(b) and (c) of Part V of this document) in favour of the Company.
A summary of the principal terms of the Disposal Agreement are set out in more detail in Part III of this document.
On 13 March 2012 the Company released an interim management statement, which included the following statements:
"In 2012, to date the mine has maintained the average monthly production of 135,000 tonnes which it achieved in the second half of 2011.
The demand for Black Wattle's output continues to remain strong in both the domestic and export market. Price increases for the first quarter of 2012 have been achieved in most of our domestic markets. Coal stockpile levels on the mine remain low and costs are in line with expectations.
As previously announced on 27 January 2012, we are pleased to report that Black Wattle has been approved an allocation of 87,500 tonnes of export tonnage at Richards Bay Coal Terminal. The allocation will allow Black Wattle direct access to the coal export market.
In addition, income from Bisichi's UK property portfolio remains steady, with no significant change."
Your attention is drawn to the risk factors set out in Part II of this document and the additional information set out in Part V of this document. Shareholders should read the whole of this document and not rely solely on the summarised information of this letter.
As noted above, Completion is conditional upon (inter alia) the approval of the Company's Shareholders being obtained at the General Meeting. Accordingly, set out at the end of this document is a notice convening a General Meeting to be held at the Royal Automobile Club, 89 Pall Mall, London SW1Y 5LP on 3 April 2012 at 11 a.m. at which the Resolution will be proposed to approve the Disposal on the terms set out in this document. On 14 March 2012 the Company announced that the General Meeting was to be held at the Royal Automobile Club, 89 Pall Mall, London SW1Y 5LP, on 30 March 2012 at 11a.m. As noted above the General Meeting is now to be held at the same venue but on 3 April 2012 at 11a.m., the change is as a result of a delay in publication of this document.
You will find enclosed with this document a Form of Proxy for use at the General Meeting. Whether or not you propose to attend the General Meeting in person, it is important that you complete and sign the enclosed Form of Proxy in accordance with the instructions printed thereon and return it to the Company's Registrars, Capita Registrars at PXS, 34 Beckenham Road, Beckenham, Kent BR3 4TU by no later than 11 a.m. on 30 March 2012. Alternatively you may submit your proxy online at www.capitashareportal.com. The completion and return of a proxy will not preclude you from attending the General Meeting and voting in person should you so wish.
In the Board's opinion, the Disposal is in the best interests of the Company and its Shareholders as a whole. Accordingly, the Board unanimously recommends that Shareholders vote in favour of the Resolution set out in the Notice, as each Director intends to do in respect of his own holdings of Ordinary Shares (of which he holds legal title) which amounts to 856,753 Ordinary Shares as at 14 March 2012 (being the last practicable date before the publication of this document), representing approximately 8.11 per cent. of the existing issued share capital of the Company. In addition, certain other Shareholders holding in aggregate 4,432,618 Ordinary Shares as at 14 March 2012 (being the latest practicable date before the publication of this document), representing approximately 41.99 per cent. of the existing issued share capital of the Company, have irrevocably undertaken to vote in favour of the Resolution.
Yours faithfully
Michael Heller Executive Chairman
Prior to making any decision to vote in favour of the proposed Resolution at the General Meeting, Shareholders should carefully consider, together with all other information contained in this document, the specific factors and risks described below. The Board considers the following to be the known material risk factors relating to the Disposal for Shareholders to consider.
The risks described below relate only to the Disposal. They do not comprise any of the risks associated with Bisichi and/or Ezimbokodweni or the industries in which Bisichi and/or Ezimbokodweni operate, for which there are multiple risks that have not been disclosed below. The risks set out below are not set out in any particular order of priority.
There may be other risks of which the Board is not aware or which it believes to be immaterial which may, in the future, be connected to the Disposal and have an adverse effect on the business, financial condition, results of operations or future prospects of the Continuing Group after the Disposal.
Following the Disposal, any benefit from the diversification of production which the Continuing Group historically expected to receive through its investment in Ezimbokodweni will no longer be possible since the Company will not be developing the Pegasus coal reserve in South Africa.
The Disposal Agreement contains warranties and indemnities given by the Company as set out in more detail in Part III of this document. These warranties and indemnities could cause the Company to incur liabilities and obligations to make payments which would not have arisen but for the proposed Disposal. The warranties and indemnities provided in the Disposal Agreement by each party do not have any financial caps or time limits. If the Continuing Group incurs such liabilities, this may have an adverse effect on the Continuing Group's business, financial condition and results of operations.
The Company presents its financial statements in Pounds Sterling. The transaction value for the proposed Disposal will be in South African Rand. The Continuing Group is therefore exposed to movements in exchange rates between the Pound Sterling and the South African Rand as initially the Purchase Price will be recorded in South African Rand and then translated into Pounds Sterling.
Completion of the proposed Disposal is also subject to completion of the BECSA Sale and the Endulwini/HSTI Transaction in addition to approval of Shareholders.
Consequently, even if the proposed Disposal is approved by Shareholders at the General Meeting there is no certainty that the transaction will complete. If the conditions are not satisfied and the Disposal does not proceed, the Group will be required to meet its accrued costs in respect of the aborted Disposal.
Any delay in Completion could diminish the anticipated benefits of the proposed Disposal or result in additional transaction costs or other effects associated with uncertainty about the proposed Disposal.
The Board is of the opinion that the Disposal is in the best interests of Shareholders as a whole and the Directors believe that the Disposal currently provides the best opportunity to realise value from the Group's investment in Ezimbokodweni. Accordingly, if the Disposal does not complete, the Group and consequently Shareholders, would be deprived, for the time being, of the opportunity to realise value from its investment.
The Board is of the opinion that the Disposal is in the best interest of Shareholders as a whole, and the consideration is at a considerable premium to the current carrying value for the investment in Ezimbokodweni. However there is a risk that the potential future value of Ezimbokodweni is in excess of the consideration.
The Disposal Agreement was entered into on 24 June 2011 between the Company (1), the Purchaser (2), the Ramaite Trust (3), Khumalo (4), Ramaite (5), Endulwini (6) and Ezimbokodweni (7). Under the terms of the Disposal Agreement, the Purchaser has conditionally agreed to acquire the Sale Equity.
The consideration payable by the Purchaser to the Company in respect of the Sale Equity is ZAR54,200,000 and is payable on the Payment Date in cash without set-off or deduction.
Pursuant to the terms of the Disposal Agreement there will be an approximate 30 day period between the transfer of the Ezimbokodweni Shares to HSTI, and the subsequent payment of the Purchase Price. Therefore, as security for payment of the Purchase Price by the Purchaser and the performance of the Purchaser's obligations under the Disposal Agreement, the HSTI Parties and the Purchaser have provided the Pledges (comprising a pledge and cession of certain shares and related claims which are more fully described in paragraphs 7.1(b) and (c) of Part V of this document) in favour of the Company.
4.2 The Disposal Agreement contains an indemnity by the Company in favour of Ezimbokodweni, against any claims which Black Wattle may have against Ezimbokodweni. As at 31 December 2010, the last audited financial statements of Black Wattle, these claims, being the representing Intercompany Loan, amounted to ZAR12,387,534.
4.3 The Disposal Agreement also contains certain warranties by the HSTI Guarantors in favour of the Company including, but not limited to:-
The Disposal Agreement is governed by the laws of the Republic of South Africa.
The following financial information relating to the Company's investment in Ezimbokodweni has been extracted without material adjustment from the consolidation schedules that underlie the audited consolidated accounts of the Company for the three years ended 31 December 2008, 2009, 2010 and the unaudited half yearly financial report of the Company for the six months ended 30 June 2011 which have been prepared in accordance with International Financial Reporting Standards as adopted in the EU (IFRS).
The financial information the Company's investment in Ezimbokodweni for the three years ended 31 December 2008, 2009, 2010 and for the six months ended 30 June 2011 has been prepared in accordance with the accounting policies set out in the Company's Annual Report and Accounts for the year ended 31 December 2010.
The financial information contained in this Part IV does not constitute statutory accounts within the meaning of Section 441 of the Act. The consolidated statutory accounts for the Company for the year ended 31 December 2010 have been delivered to the Registrar of Companies and the auditors' report in respect of the statutory accounts were unqualified. The Company's auditors for the year ended 31 December 2010 were PKF (UK) LLP.
Ezimbokodweni incurred costs in connection with purchasing and furthering its mining rights in the three years ended 31 December 2008, 2009, 2010 or the six months ended 30 June 2011. However, these costs were all capitalised within current assets and accordingly no income statement is presented.
Ezimbokodweni was included in the Company's consolidated balance sheet as part of "Investment in joint ventures" within non-current assets. The amount attributable to the Company's investment at 31 December 2010 and 30 June 2011 was as follows:
| 31 December 2010 | 30 June 2011 |
|---|---|
| £000 | £000 |
| Investment in joint venture 1,885 |
1,816 |
Set out below is an unaudited pro forma statement of net assets for the Continuing Group, showing the effect of the Disposal. The unaudited pro forma statement of net assets is based on the unaudited consolidated half yearly financial report of the Company as at 30 June 2011 adjusted as described in the notes set out below. The unaudited pro forma statement has been prepared to illustrate how the consolidated net assets of the Company might have been affected by the Disposal, had it taken place as at that date.
The unaudited pro forma statement has been prepared for illustrative purposes only. It addresses a hypothetical situation and does not, therefore, represent the Continuing Group's actual financial position or results.
| Adjustments | |||||
|---|---|---|---|---|---|
| Company at 30 June 2011 see note 1 below) £000 |
Net assets disposed of see note 2 below) £000 |
Gross Proceeds see note 3 below) £000 |
Cost of the disposals (see note 4 below) £000 |
Adjusted pro forma continuing group £000 |
|
| ASSETS | |||||
| Non current assets Value of investment properties attributable |
|||||
| to the Group | 12,110 | — | — | — | 12,110 |
| Fair value of head leases | 227 | — | — | — | 227 |
| Property | 12,337 | — | — | — | 12,337 |
| Reserves, plant and equipment | 9,285 | — | — | — | 9,285 |
| Investment in joint ventures | 4,425 | (1,816) | — | — | 2,609 |
| Other investments | 150 | — | — | — | 150 |
| Total non-current assets | 26,197 | (1,816) | — | — | 24,381 |
| Current assets | |||||
| Inventories | 811 | — | — | — | 811 |
| Trade and other receivables | 4,620 | — | — | — | 4,620 |
| Corporation tax recoverable | 55 | — | — | — | 55 |
| Held for trading investments | 899 | — | — | — | 899 |
| Cash and cash equivalents | 4,848 | — | 4,553 | (208) | 9,193 |
| Total current assets | 11,233 | — | 4,553 | (208) | 15,578 |
| TOTAL ASSETS | 37,430 | (1,816) | 4,553 | (208) | 39,959 |
| LIABILITIES | |||||
| Current liabilities | |||||
| Borrowings | (3,087) | — | — | — | (3,087) |
| Trade and other payables | (9,352) | — | — | — | (9,352) |
| Current tax liabilities | (409) | — | — | — | (409) |
| Total current liabilities | (12,848) | — | — | — | (12,848) |
| Non-current liabilities | |||||
| Borrowings | (5,209) | — | — | — | (5,209) |
| Provision for rehabilitation | (1,038) | — | — | — | (1,038) |
| Finance lease liabilities | (227) | — | — | — | (227) |
| Deferred tax liabilities | (1,546) | — | — | — | (1,546) |
| Total non-current liabilities | (8,020) | — | — | — | (8,020) |
| TOTAL LIABILITIES | (20,868) | — | — | — | (20,868) |
| NET ASSETS | 16,562 | (1,816) | 4,553 | (208) | 19,091 |
The consolidated net assets of the Company have been extracted, without material adjustment, from the unaudited half yearly financial report for the six months to 30 June 2011.
The net assets being disposed have been extracted, without material adjustment, from the consolidation schedules that underlie the unaudited consolidated half yearly financial report for the six months to 30 June 2011. The net assets at 30 June 2011 of £1,816,000 comprise an outstanding loan due to Black Wattle by Ezimbokodweni of £1,134,000 and the Company's cost of its investment in Ezimbokodweni of £682,000.
The Directors Bisichi Mining PLC 30-35 Pall Mall London SW1Y 5LP
and
Shore Capital and Corporate Limited Bond Street House 14 Clifford Street London W1S 4JU
16 March 2012
Dear Sirs
BISICHI MINING PLC ("THE COMPANY")
We report on the pro forma financial information (the ''Pro forma financial information'') set out in Part IV of the Class 1 circular dated 16 March 2012 (the ''Circular''), which has been prepared on the basis described in notes 1 to 4, for illustrative purposes only, to provide information about how the transaction might have affected the financial information presented on the basis of the accounting policies adopted by the Company in preparing the financial statements for the period ended 30 June 2011. This report is required by Annex I item 20.2 of Commission Regulation (EC) No 809/2004 (the ''Prospectus Directive Regulation'') as applied by Listing Rule 13.3.3R and is given for the purpose of complying with that requirement and for no other purpose.
It is the responsibility of the directors of the Company (the ''Directors'') to prepare the Pro forma financial information in accordance with Annex I item 20.2 and Annex II items 1 to 6 of the Prospectus Directive Regulation as applied by Listing Rule 13.3.3R.
It is our responsibility to form an opinion, in accordance with Annex I item 20.2 of the Prospectus Directive Regulation, as to the proper compilation of the Pro forma financial information and to report that opinion to you in accordance with Annex II item 7 of the Prospectus Directive Regulation as applied by Listing Rule 13.3.3R.
Save for any responsibility which we may have to those persons to whom this report is expressly addressed and which we may have to Shareholders as a result of the inclusion of this report in the Circular, to the fullest extent permitted by law we do not assume any responsibility and will not accept any liability to any other person for any loss suffered by any such other person as a result of, arising out of, or in accordance with this report or our statement, required by and given solely for the purposes of complying with Listing Rule 13.4.1R(6), consenting to its inclusion in the Circular.
In providing this opinion we are not updating or refreshing any reports or opinions previously made by us on any financial information used in the compilation of the Pro forma financial information, nor do we accept responsibility for such reports or opinions beyond that owed to those to whom those reports or opinions were addressed by us at the dates of their issue.
We conducted our work in accordance with the Standards for Investment Reporting issued by the Auditing Practices Board in the United Kingdom. The work that we performed for the purpose of making this report, which involved no independent examination of any of the underlying financial information, consisted primarily of comparing the unadjusted financial information with the source documents, considering the evidence supporting the adjustments and discussing the Pro forma financial information with the Directors.
We planned and performed our work so as to obtain the information and explanations we considered necessary in order to provide us with reasonable assurance that the Pro forma financial information has been properly compiled on the basis stated and that such basis is consistent with the accounting policies of the Company.
Our work has not been carried out in accordance with auditing or other standards and practices generally accepted in jurisdictions outside the United Kingdom, including the United States of America, and accordingly should not be relied upon as if it had been carried out in accordance with those standards or practices.
In our opinion:
Yours faithfully
PKF (UK) LLP
PKF (UK) LLP | Farringdon Place | 20 Farringdon Road | London | EC1M 3AP | DX 479 London/Chancery Lane
PKF (UK) LLP is a limited liability partnership registered in England and Wales with registered number OC310487. A list of members' names is open to inspection at Farringdon Place, 20 Farringdon Road, London EC1M 3AP, the principal place of business and registered office. PKF (UK) LLP is authorised and regulated by the Financial Services Authority for investment business activities. PKF (UK) LLP is a member firm of the PKF International Limited network of legally independent firms and does not accept any responsibility or liability for the actions or inactions on the part of any other individual member firm or firms.
The Directors, whose names appear on page 6 of this document, accept responsibility for the information contained in this document. To the best of the knowledge and belief of the Directors (who have taken all reasonable care to ensure that such is the case), the information contained in this document is in accordance with the facts and does not omit anything likely to affect the import of such information.
3.1 As at 14 March 2012 (being the latest practicable date prior to the publication of this document), the interests of the Directors and Senior Management (all of which are beneficial unless otherwise stated), which are known by the Directors or could with reasonable due diligence be ascertained by them, are as follows:
| Number of | % of issued | |
|---|---|---|
| Ordinary | share capital | |
| Directors and Senior Management | Shares | of the Company |
| Michael Heller3 | 330,1171 | 3.13 |
| Andrew Heller3 | 785,0122 | 7.44 |
| Garrett Casey | — | — |
| Robert Grobler | — | — |
| Christopher Joll | — | — |
| John Sibbald | — | — |
| Luis Pinel | — | — |
1 106,666 Ordinary Shares are held through a nominee account (80,000 of these Michael Heller is interested in by virtue of his interest as a potential beneficiary in a discretionary trust), 48,000 Ordinary Shares are held by South Yorkshire Property Trust Limited of which Michael Heller is a shareholder and 53,334 Ordinary Shares are held by London & South Yorkshire Securities Limited of which Michael Heller is a shareholder.
2 151,710 Ordinary Shares are held in a self invested pension plan for the benefit of Andrew Heller.
3 In addition, the Heller family has a controlling share in LAP. LAP is a substantial shareholder in the Company, further details of which are set out in paragraph 5 of this Part V.
As at 14 March 2012 (being the latest practicable date prior to the publication of this document), the Directors and Senior Management held the following interests in Ordinary Shares under the Company's share plans:
| % of issued | |||||
|---|---|---|---|---|---|
| Company | No. of | share | |||
| Share | Ordinary | Exercise | Expiry | Exercise | capital of |
| Plan | Shares | Date | Date | Price | the Company |
| First Scheme | 233,000 | 30 September 2005 | 29 September 2012 | 34p | 2.2 |
| Second Scheme | 80,000 | 24 September 2007 | 23 September 2014 | 149p | 0.7 |
| 2006 Scheme | 275,000 | 4 October 2009 | 3 October 2016 | 237.5p | 2.6 |
| 2010 Scheme | 80,000 | 31 August 2013 | 30 August 2020 | 202.5p | 0.7 |
Save for the service contracts described below, there are no existing or proposed service contracts between any Director and the Company and its subsidiary undertakings.
(a) Michael Heller
On 8 November 1972, Michael Heller entered into a service agreement with the Company under the terms of which he agreed to act as Executive Chairman of the Company with effect from 8 November 1972 for a current remuneration package of £75,000 per annum and reimbursement of all expenses incurred. The service agreement may be terminated by the Company giving not less than 6 month's notice in writing, and by Mr Heller giving not less than 1 month's notice in writing. The service agreement makes no provision for any termination benefits.
(b) Andrew Heller
On 14 January 1994, Andrew Heller entered into a service agreement with the Company under the terms of which he agreed to act as Managing Director of the Company with effect from 6 January 1994 for a current remuneration package of £350,000 per annum, to be reviewed annually by the Board and reimbursement of all reasonably incurred expenses. Mr Heller is entitled to participate in the Company's pension scheme and private medical insurance scheme. The service agreement may be terminated by either party giving not less than 3 month's notice in writing. The service agreement makes no provision for any termination benefits.
(c) Garrett Casey
On 14 March 2008, Garrett Casey entered into a service agreement with the Company under the terms of which he agreed to act as Finance Director of the Company with effect from 1 April 2008 for a current remuneration package of £115,000 per annum, to be reviewed annually by the Board. Mr Casey is entitled to participate in the Company's pension scheme and private medical insurance scheme. The service agreement may be terminated by either party giving not less than 2 month's notice in writing. The service agreement makes no provision for any termination benefits. The service agreement contains non-compete, non solicitation and non-dealing restrictions for 3 months following termination.
(d) Robert Grobler
On 23 May 2008, Robert Grobler entered into a service agreement with the Company under the terms of which he agreed to act as an executive director of the Company with effect from 22 April 2008 for a current remuneration package of £184,000 per annum and reimbursement of all reasonably incurred expenses. The service agreement may be terminated by either party giving not less than 3 month's notice in writing. The service agreement makes no provisions for any termination benefits.
(a) Christopher Joll
On 2 February 2001, Christopher Joll entered into a letter of appointment with the Company effective from 1 February 2001 under the terms of which he agreed to act as a non-executive director for a current fee of £25,000 per annum and reimbursement of all reasonably incurred expenses. The letter of appointment is terminable at any time by either party giving 3 month's prior written notice. The letter of appointment makes no provisions for any termination benefits.
(b) John Sibbald
On 20 October 1988, John Sibbald entered into a letter of appointment with the Company effective from 20 October 1988 under the terms of which he agreed to act as a non-executive director for a fee of £2,000 per annum and reimbursement of all reasonably incurred expenses. Mr Sibbald is entitled to participate in the Company's private patients plan. The letter of appointment is terminable at any time by either party giving 3 month's prior written notice. The letter of appointment makes no provisions for any termination benefits.
5.1 As at 14 March 2012 (being the latest practicable date prior to the publication of this document), the Company is not aware of any persons (other than the Directors and Senior Managers) who, directly or indirectly, has an interest representing 3 per cent. or more of the issued Ordinary Share capital of the Company or voting rights (being the level notifiable under the securities law of the Company's national law):
| % of | |
|---|---|
| issued share | |
| capital of | |
| Shares | the Company |
| 41.99 | |
| 4.89 | |
| 3.98 | |
| 340,0004 | 3.22 |
| Number of Ordinary 4,432,6181 516,2502 420,0003 |
1 Mr M Heller is a director and shareholder of London & Associated Properties Plc
2 516,250 Ordinary Shares are held by a nominee on behalf of Cavendish Asset Management
3 420,000 Ordinary Shares are held by a nominee on behalf of Cavendish Opportunities Fund
4 280,000 Ordinary Shares are held by a nominee on behalf of Mr Kirton
The following contracts, not being contracts entered into in the ordinary course of business, which (i) are or may be material and have been entered into by the Continuing Group within the two years immediately preceding the date of this document or (ii) have been entered into by the Continuing Group at anytime before the date of this document where those contracts contain provisions under which the Continuing Group has an obligation or entitlement which is or maybe material to the Continuing Group.
The principle terms of the Disposal Agreement are set out in Part III of this document.
(b) HSTI Pledge
A pledge and cession of shares and claims dated 24 June 2011 between HSTI (1), the Company (2) and Ezimbokodweni (3) pursuant to which HSTI agreed to pledge the Ezimbokodweni Shares and cede in securitatem debiti (cession of a claim as security for a debt) the Sale Equity to the Company, as security for the due performance of HSTI's obligations pursuant to the Disposal Agreement.
(c) HSTI Parties' Pledge
A pledge and cession of shares and claims dated 24 June 2011 between the HSTI Shareholders (1), Ramaite (2), Xantium 437 (Proprietary) Limited (3), HSTI (4), the Company (5) and Ezimbokodweni (6) pursuant to which the HSTI Shareholders pledged and ceded their shareholding in HSTI to the Company and the HSTI Parties and Xantium 437 (Proprietary) Limited ceded their claims against HSTI and Ezimbokodweni to the Company, as security for the due performance of HSTI's obligations pursuant to the Disposal Agreement.
(d) Relationship Agreement
The Company entered into a relationship agreement with LAP dated 15 September 2005, to govern the relationship between the Company and LAP, which includes, amongst other matters, provisions intended to ensure that the Company will be able to operate independently of LAP as a Shareholder for so long as it and its associates together are controlling shareholders (as defined by the Listing Rules) of the Company. LAP agrees, as far as it is able to, as a Shareholder to, inter alia:
The Company entered into a joint venture agreement dated 31 January 2007 with Dragon Retail Properties Limited ("Dragon Retail") and LAP pursuant to which, LAP and the Company govern their relationship in Dragon Retail, a joint venture owned equally by the Company and LAP. The joint venture agreement sets out, among other things, each parties right to equal board representation, financing and sharing of profits and losses in Dragon Retail.
(f) Black Wattle Mining Right
Mining rights MP 30/5/1/2/2/21 and MP 30/5/1/2/2/22 dated 23 November 2009 granted to Black Wattle to mine coal. The mining rights are in respect of the remaining extent of portion 2 of the farm Uitkyk 290 JS, the remaining extent of portion 27 of the farm Middelburg town and Towlands 287JS, portions 4,14,27 and portion of the Mineral Area 1 (a portion of portion 3) of the farm Vaalbank 289 JS situated in the magisterial district of Middelburg in Mpumalanga province, for an area of 1,019.8124 hectares.
A Subscription and Shareholders' Agreement dated 12 November 2008 (as amended 10 July 2009 and 13 May 2010) between Bisichi Mining (Exploration) Limited, a wholly owned subsidiary of the Company (1), Vunani Mining (Pty) Limited ("Vunani Mining") (2), Neosho Trading 106 (Proprietary) Limited (3), and Black Wattle (4) pursuant to which Vunani Mining purchased 37.5 per cent. shareholding in Black Wattle by way of a subscription for shares. The agreement also set out the relationship between the Company and Vunani Mining as shareholders of Black Wattle.
The following contracts, not being contracts entered into in the ordinary course of business, which (i) are or may be material and have been entered into in relation to the Ezimbokodweni Shares and Ezimbokodweni Claims by members of the Continuing Group within the two years immediately preceding the date of this document or (ii) have been entered into by any member of the Continuing Group at anytime before the date of this document where those contracts contain provisions under which any member of the Continuing Group has an obligation or entitlement which is or maybe material in relation to the Ezimbokodweni Shares and Ezimbokodweni Claims.
(a) Disposal Agreement
The principle terms of the Disposal Agreement are set out in Part III of this document.
(b) HSTI Pledge
The principle terms of the HSTI Pledge are set out in paragraph 7.1(b) above.
(c) HSTI Parties' Pledge
The principle terms of the HSTI Parties' Pledge are set out in paragraph 7.1(c) above.
There are no governmental, legal or arbitration proceedings (and no such proceedings are pending or threatened of which the Company is aware) during the 12 months prior to the date of this document, which may have, or have had in the recent past significant effects on the Company and/or Continuing Group's financial position or profitability.
There are no governmental, legal or arbitration proceedings (and no such proceedings are pending or threatened of which the Company is aware) during the 12 months prior to the date of this document, which may have, or have had in the recent past significant effects on the Ezimbokodweni Shares and Ezimbokodweni Claims.
In the opinion of the Company taking into account the net proceeds from the Disposal, the working capital available to the Continuing Group is sufficient for its present requirements, being at least the next 12 months from the date of this document.
There has been no significant change in the financial or trading position of the Company and the Continuing Group since 30 June 2011, being the date on which the last published interim financial statements of the Group were prepared.
There has been no significant change in the financial or trading position of the Ezimbokodweni Shares and Ezimbokodweni Claims since 30 June 2011, being the date on which the last published interim financial statements of the Group were prepared.
Copies of the following documents may be inspected during normal business hours on working days, at the registered office of the Company at 30-35 Pall Mall, London SW1Y 5LP, United Kingdom and at the offices of Memery Crystal LLP, 44 Southampton Buildings, London WC2A 1AP United Kingdom from the date of this document until the conclusion of the General Meeting:
The following definitions apply throughout this document, unless stated otherwise:
| "2006 Scheme" | the Company unapproved share option scheme adopted on 29 June 2006 |
|---|---|
| "2010 Scheme" | the Company unapproved share option scheme adopted on 7 June 2011 |
| "Act" | the Companies Act 2006 |
| "BECSA" | BHP Billiton Energy Coal South Africa Limited, a public company duly incorporated according to the laws of the Republic of South Africa with registration number 1963/000537/06 |
| "BECSA Guarantee Claims" | all claims of whatsoever nature which HSTI and/or the HSTI Shareholders and/or Ramaite or any of them, may have against Ezimbokodweni in respect of, or arising from any payment made by any of them in respect of the Purchase Price and/or from the provision by them to Ezimbokodweni of any funds utilised to discharge the BECSA Purchase Price, and whether any such payment or the provision of any such funds is made by them as principal debtor or guarantor |
| "BECSA Purchase Price" | the purchase price payable by Ezimbokodweni to BECSA in respect of the BECSA Sale |
| "BECSA Sale" | the sale by BECSA to Ezimbokodweni of the Pegasus Project |
| "Black Wattle" | Black Wattle Colliery (Proprietary) Limited, a company incorporated in the Republic of South Africa with registration number 1994/02802/07, in respect of which the Company holds 62.5 per cent. of the total issued share capital |
| "Board" | the board of Directors of the Company from time to time |
| "Business Day" | any day other than a Saturday, Sunday or official public holiday in the Republic of South Africa |
| "Company" or "Bisichi" | Bisichi Mining plc, a company incorporated in England and Wales with company number 00112155 |
| "Company's Registrars" | Capita Registrars Limited |
| "Completion" | completion of the Disposal in accordance with the terms of the Disposal Agreement |
| "Continuing Group" | the Group following the Disposal |
| "CREST" | the electronic paperless transfer and settlement system which facilitates the transfer of title to shares in uncertificated form operated by Euroclear UK & Ireland Limited |
| "Directors" | the directors of the Company, as at the date of this document, whose names appear on page 6 of this document |
| "Disclosure and Transparency Rules" or "DTRs" |
the disclosure and transparency rules of the UKLA made in accordance with section 73A of FSMA, as amended from time to time |
| "Disposal" | the proposed disposal by the Company of the Sale Equity to the Purchaser on the terms of the Disposal Agreement |
|---|---|
| "Disposal Agreement" | the conditional sale and purchase agreement dated 24 June 2011 (as amended on 8 July 2011 and 22 July 2011 and reinstated on 25 January 2012) between the Company (1), the Purchaser (2), the Ramaite Trust (3), Khumalo (4), Ramaite (5), Endulwini (6) and Ezimbokodweni (7) relating to the Disposal and described in detail in Part III of this document |
| "Effective Date" | the third Business Day following the date of fulfilment of the last of the conditions in the Disposal Agreement |
| "EH-MOU" | the document entitled the "COMMERCIAL PRINCIPLES FOR PARTICIPATION IN THE PEGASUS PROJECT" signed by Endulwini and HSTI on 17 March 2011 setting out the commercial principles for the participation of HSTI in the Pegasus Project |
| "Endulwini" | Endulwini Coal Limited, a company incorporated in the Republic of South Africa with registration number 2002/012698/06 |
| "Endulwini/Bisichi Shareholders Agreement" |
the subscription and shareholders' agreement concluded between Endulwini, the Company and Ezimbokodweni in and during 2005, which, inter alia, regulates the relationship of Endulwini and Bisichi as shareholders in the Company |
| "Endulwini/HSTI Transaction" | the written agreement concluded, or to be concluded between Endulwini and HSTI, regulating, inter alia, their relationship as shareholders of Ezimbokodweni, consequent upon the exit of the Company as a shareholder of Ezimbokodweni upon the implementation of the Disposal Agreement and, inter alia, the future relationship of Endulwini and HSTI as shareholders of Ezimbokodweni |
| "Ezimbokodweni" | Ezimbokodweni Mining (Proprietary) Ltd, a company incorporated in the Republic of South Africa with registration number 2001/01457/07 |
| "Ezimbokodweni Claims" | all claims of whatsoever nature, and from whatsoever cause arising, which Bisichi may have against Ezimbokodweni as at the Effective Date |
| "Ezimbokodweni Shares" | the 490 ordinary shares of ZAR1 each in Ezimbokodweni held by the Company, comprising 49 per cent. of the total issued share capital of Ezimbokodweni |
| "First Scheme" | the Company unapproved share option scheme adopted on 15 June 1999 |
| "Form of Proxy" | the form of proxy accompanying this document for use by the Shareholders in connection with the General Meeting |
| "FSA" | Financial Services Authority |
| "FSMA" | the Financial Services and Markets Act 2000, as amended from time to time |
| "General Meeting" | the general meeting of the Company to be held at the Royal Automobile Club, 89 Pall Mall, London SW1Y 5LP on 3 April 2012 at 11 a.m. (or any adjournment of such general meeting) convened by the Notice and at which the Resolution will be proposed |
|---|---|
| "Group" | the Company and each of its subsidiary undertakings (within the meaning of the Act) at the date of this document |
| "HSTI Guarantors" | HSTI, HSTI Shareholders and Ramaite, jointly and severally |
| "HSTI Parties" | the HSTI Shareholders and Ramaite, jointly and severally |
| "HSTI Parties' Pledge" | the pledge and cession dated 24 June 2011 between the HSTI Shareholders (1), Ramaite (2), Xantium 437 (Proprietary) Limited (3), HSTI (4), the Company (5) and Ezimbokodweni (6), details of which are set out in paragraph 7.1(c) of Part V of this document |
| "HSTI Pledge" | the pledge and cession dated 24 June 2011 2011 between HSTI (1), the Company (2) and Ezimbokodweni (3), details of which are set out in paragraph 7.1(b) of Part V of this document |
| "HSTI Shareholders" | the Ramaite Trust and Khumalo, jointly and severally |
| "Intercompany Loan" | intercompany loan by Black Wattle to Ezimbokodweni, as at 31 December 2010, being ZAR12,387,534 |
| "Khumalo" | Wiseman Nkululeko Khumalo (South African identity number 7609095357084) |
| "LAP" | London & Associated Properties plc |
| "Listing Rules" | the Listing Rules made by the UKLA under section 73A of the FSMA, as amended from time to time |
| "London Stock Exchange" | the London Stock Exchange plc |
| "Notice" | notice of the General Meeting contained on pages 29 to 31 of this document |
| "Ordinary Shares" | ordinary shares of 10 pence each in the capital of the Company |
| "Original Agreement" | the agreement dated 21 April 2005 between Ezimbokodweni and Ingwe Collieries (Pty) Limited, details of which are set out in paragraph 3 of Part I of this document |
| "Payment Date" | means 30 days after the Effective Date |
| "Pegasus Project" | the properties comprising Mineral Area 2 (a portion of Mineral Area 1) of the farm GELUK 276 REGISTRATION DIVISION JS MPUMALANGA (Republic of South Africa) together with all surface and prospecting rights attached thereto |
| "Pledges" | the HSTI Pledge and the HSTI Parties' Pledge |
| "Pound Sterling" or "£" | Great British Pound, being the lawful currency of the United Kingdom |
| "Purchase Price" | the purchase price payable by HSTI to the Company for the Sale Equity in the sum of ZAR54,200,000 in terms of the Disposal Agreement |
|---|---|
| "Purchaser" or "HSTI" | the proposed purchaser of the Ezimbokodweni Shares, Hasty Shelf Trade and Invest 17 (Proprietary) Limited, a company incorporated in the Republic of South Africa with registered number 2009/002669/07 |
| "Ramaite" | Muthanyi Robinson Ramaite (South African identity number 6903075973080) |
| "Ramaite Trust" | the Ramaite Brothers Family Trust (Masters Reference no. IT4489/01) |
| "Resolution" | the resolution to be proposed at the General Meeting which is set out in the Notice on page 29 of this document |
| "Sale Equity" | the Ezimbokodweni Shares and the Ezimbokodweni Claims |
| "SAMREC Code" | the South African Code for Reporting of Mineral Resources and Mineral Reserves, as published by the South African Mineral Committee under the auspices of the South African Institute of Mining and Metallurgy |
| "Second Scheme" | the Company unapproved share option scheme adopted on 23 June 2005 |
| "Senior Manager" or "Senior Management" |
Luis Pinel |
| "Shareholders" | holders of Ordinary Shares |
| "Shore Capital" | Shore Capital & Corporate Limited |
| "UK" or "United Kingdom" | the United Kingdom of Great Britain and Northern Ireland |
| "UKLA" "UK Listing Authority" | the FSA acting in its capacity as the competent authority for the purposes of Part VI of FSMA |
| "ZAR" | South African Rand, being the lawful currency of the Republic of South Africa |
NOTICE IS HEREBY GIVEN that a General Meeting of Bisichi Mining Plc (the "Company") will be held at the Royal Automobile Club, 89 Pall Mall, London SW1Y 5LP, on 3 April 2012 at 11 a.m. to consider and, if thought fit, pass the following resolution which will be proposed as an ordinary resolution:
THAT the Disposal, on the terms set out in the Disposal Agreement (both defined in the circular to shareholders of the Company dated on 16 March 2012 (the "Circular")), be and is hereby approved, and that the directors of the Company (the "Directors") (or any duly constituted committee thereof) be and are hereby authorised to make such non-material amendments, waivers or variations to the terms and conditions of the Disposal or to the Disposal Agreement and any agreements incidental to or forming part of the Disposal Agreement which the Directors (or any duly constituted committee thereof) in their absolute discretion consider necessary, expedient or desirable to complete or give effect to or otherwise in connection with the Disposal and/or any agreement executed to give effect thereto and to do all such other things they may consider necessary, desirable or expedient in connection with the Disposal.
By order of the Board Registered office:
30-35 Pall Mall London
Michael Heller SW1Y 5LP Executive Chairman 16 March 2012
Notes
The revocation notice must be received by Capita Registrars no later than 11 a.m. on 30 March 2012. If you attempt to revoke your proxy appointment but the revocation is received after the time specified then, subject to the immediately following paragraph, your proxy appointment will remain valid. Appointment of a proxy does not preclude you from attending the meeting and voting in person. If you have appointed a proxy and attend the meeting in person, your proxy appointment will automatically be terminated.
If you attempt to revoke your proxy appointment but the revocation is received after the time specified then, subject to the immediately following paragraph, your proxy appointment will remain valid.
Appointment of a proxy does not preclude you from attending the meeting and voting in person. If you have appointed a proxy and attend the meeting in person, your proxy appointment will automatically be terminated.
Pursuant to section 319A of the Companies Act 2006, the Company must cause to be answered at the General Meeting any question relating to the business being dealt with at the General Meeting which is put by a member attending the meeting, except in certain circumstances, including if it is undesirable in the interests of the Company or the good order of the meeting that the question be answered or if to do so would involve the disclosure of confidential information.
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