PAN AFRICAN RESOURCES PLC

Legal Proceedings Report • Jul 19, 2016

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PAN AFRICAN RESOURCES PLC - Update on Phoenix and IFMSA Business Rescue

PR Newswire

London, July 19

Pan African Resources PLC

(Incorporated and registered in England and Wales under Companies Act 1985 with registered number 3937466 on 25 February 2000)

AIM Code: PAF

JSE Code: PAN

ISIN: GB0004300496

(“Pan African” or the “Company”)

UPDATE ON PHOENIX PLATINUM AND IFMSA BUSINESS RESCUE PROCEEDINGS

Pan African shareholders are referred to the announcement published by the Company on 27 August 2015, informing shareholders that International Ferro Metals Limited announced that as a result of deteriorating business conditions, its South African subsidiary, International Ferro Metals (SA) Pty Limited (“IFMSA”), had entered into Business Rescue.  Business Rescue is a statutory means of enabling a financially distressed company to continue business, under the supervision of a Business Rescue Practitioner, protected from its creditors.

Pan African’s wholly-owned subsidiary, Phoenix Platinum Mining (Proprietary) Limited (“Phoenix”), is situated on the IFMSA property, and a portion of the feedstock for the Phoenix operation was obtained from IFMSA’s processing activities.  Phoenix also sources electricity, water and certain other services from IFMSA.  The relationship between Phoenix and IFMSA was governed by a tailings treatment agreement (“TTA”) entered into by Pan African, Phoenix and IFMSA.

Although Phoenix was not solely reliant on material from IFMSA, the Business Rescue proceedings created a number of uncertainties and operating difficulties for Phoenix.

In terms of the Business Rescue proceedings, Samancor Chrome Limited (“Samancor”) was selected as the successful bidder to acquire the business and assets of IFMSA. Samancor subsequently nominated its subsidiary TC Smelters Proprietary Limited (“TC Smelters”) as the acquirer of the IFMSA business and assets.

Pan African is now pleased to announce that it has reached an agreement (the “Agreement”) with TC Smelters.  The Agreement allows, inter alia, for the assignment of the TTA to TC Smelters.  The Agreement further clarifies a number of the provisions contained in the TTA, and will become effective at the same time as the IFMSA and TC Smelters sale of business agreement.

Even though the Agreement does not guarantee current arising feedstock to Phoenix (this will be dependent on the manner in which TC Smelters utilises the IFMSA assets), it places Phoenix in a position where it will continue operations under similar conditions as those that existed prior to the Business Rescue proceedings. It also ensures that Phoenix’s operations and interests are safeguarded.  As previously stated, Phoenix also has alternative sources of feedstock, which it processed during the Business Rescue proceedings.

For further information on Pan African, please visit the Company's website at www.panafricanresources.com

19 July 2016

CONTACT INFORMATION

Corporate Office

The Firs Office Building

1st Floor, Office 101

Cnr. Cradock and Biermann Avenues

Rosebank, Johannesburg

South Africa

Office: +27 (0) 11 243 2900

Facsimile: +27 (0) 11 880 1240

Registered Office

Suite 31

Second Floor

107 Cheapside

London

EC2V 6DN

United Kingdom

Office: +44 (0) 20 7796 8644

Facsimile: +44 (0) 20 7796 8645

Cobus Loots                                                          Deon Louw

Pan African Resources PLC                                    Pan African Resources PLC

Chief Executive Officer                                           Financial Director

Office: +27 (0)11 243 2900                                      Office: +27 (0) 11 243 2900

Phil Dexter                                                            John Prior / Paul Gillam / James Black

St James's Corporate Services Limited                    Numis Securities Limited

Company Secretary                                                Nominated Adviser & Joint Broker

Office: +44 (0)20 7796 8644                                    Office: +44 (0)20 7260 1000

Sholto Simpson                                                     Matthew Armitt / Ross Allister

One Capital                                                           Peel Hunt LLP

JSE Sponsor                                                         Joint Broker

Office: +27 (0)11 550 5009                                      Office: +44 (0)020 7418 8900

Julian Gwillim                                                         Daniel Thöle/Aarti Iyer

Aprio Strategic Communications                              Bell Pottinger PR     

Public & Investor Relations SA                                Public & Investor Relations UK

Office: +27 (0)11 880 0037                                      Office: +44 (0)20 3772 2500

Jeffrey Couch / Neil Haycock / Thomas Rider

BMO Capital Markets Limited

Joint Broker

Office: +44 (0)20 7236 1010

www.panafricanresources.com