TIDMJLP TIDMBMR
RNS Number : 8207M
Jubilee Metals Group PLC
02 May 2018
Jubilee Metals Group PLC
Registration number (4459850)
AltX share code: JBL
AIM share code: JLP
ISIN: GB0031852162
("Jubilee" or "the Company")
Jubilee Executes Kabwe Project Agreements
Highlights
-- Jubilee executes Shareholders' and Operating agreement with
BMR Group PLC for the Kabwe surface project
-- Jubilee appointed as operator of the Kabwe surface project
tasked with concluding the business plan and implementation of the
project
-- Jubilee to provide further loan funding of GBP2,000,000 for
an effective 40% ownership of the joint venture company holding the
Kabwe project in addition to holding 29,01% of BMR Group PLC
Jubilee is pleased to announce the execution of both a
Shareholders' Agreement and Operating Agreement with BMR Group PLC
("BMR") to jointly pursue the Kabwe Surface zinc, lead and vanadium
project in Zambia ("the Project"). The two agreements follow the
binding term sheet executed between the companies as announced on
23 October 2017.
Leon Coetzer, Chief Executive commented:
"I am delighted to have successfully executed the agreements
which capture Jubilee's participation in this very exciting surface
processing project.
Our immediate next project deliverable is to present the project
business plan to the newly formed joint venture company for
approval by the board. I will be presenting the project execution
plan to the Zambian authorities for approval in the coming days as
part of our ongoing engagement with the Zambian mining
department.
Our agreement with BMR calls for the final business and
execution plan to be approved by the 15(th) of June 2018. We will
continue with site preparation work and confirming equipment
specifications during this time.
The Jubilee team is ready to commence with the execution of the
project on behalf of BMR."
Shareholders' Agreement Overview
Under the Shareholders' Agreement, a joint venture company will
be established ("Kabwe Operations") which will be assigned all
intellectual property developed for the execution of the Project as
well as the right to fund and execute the Project on behalf of
BMR.
Kabwe Operations is appointed the project manager with Jubilee
appointed as the operator of the Project, with responsibility for
the developing the Project business plan, joint funding,
construction, commissioning and operations of the Project.
In terms of the Shareholders' Agreement, Jubilee is offered the
right to earn into Kabwe Operations through staged debt funding
("Debt Finance") as set out below. Jubilee's earn-in interest in
Kabwe Operations will be through preferred shares issued in Kabwe
Operations ("Preferred Shares"), which will have equal voting
rights to the issued ordinary shares of Kabwe Operations and will
have the preferred right to receive 100% of distributed profits
from Kabwe Operations until the preferred Debt Finance plus a 30%
interest component is fully paid, where after the Preferred Shares
will convert into ordinary shares of Kabwe Operations.
Jubilee Key Earn-in Terms for Kabwe Operations:
(a) Phase 1 - Jubilee has already provided access to funding for
Kabwe Operations to the value of GBP300,000 to secure a 15% equity
interest in Kabwe Operations held as a Preferred Share.
(b) Phase 2 - Jubilee will provide access to a further
GBP1,000,000 funding towards the implementation of the approved
business plan to secure a further 15% equity interest in Kabwe
Operations taking the aggregate interest of Jubilee to 30% held as
a Preferred Share. As security for the Jubilee Debt Finance, the
BMR Group would grant security over the whole of its shareholding
in the Kabwe project through its subsidiary Enviro Processing
Limited ("EPL").
(c) Phase 3 - Jubilee will provide access to a further
GBP1,000,000 funding towards the implementation of the approved
business plan to secure a further 10% equity interest in Kabwe
Operations taking the aggregate interest of Jubilee to 40% held as
a Preferred Share.
Shareholders' Agreement - Further Funding Terms
The amount of any subsequent loan funding required from time to
time for the Project shall be approved by the board of Kabwe
Operations in accordance with the Business Plan presented by
Jubilee, and shall be procured by way of:
(a) firstly, loans from shareholders pro rata to their interest
in the Kabwe Operations should the shareholders indicate a
willingness to further fund Kabwe Operations on terms and
conditions to be agreed upon at that time; or
(b) secondly, loans from a financial institution or other third
party, upon the most favourable terms available; or
(c) thirdly, in the event that funding is unsuccessful as
contemplated above, additional or other loans from shareholders,
pro rata to their shareholding.
In the event that any shareholder fails, for any reason to pay
all or any of its pro rata portion of such loan funding, the
remaining shareholders shall be entitled to provide the shortfall
in which event the failing shareholder shall be diluted
accordingly.
Operating Agreement Overview
(a) Under the agreement, EPL, holder of the Project, appoints
the Kabwe Operations as the managing consultant of the Project and
appoints Jubilee as the operator of the Project to manage, operate
and administer the Project for and on behalf of Kabwe
Operations.
(b) Jubilee as operator shall project manage the development and
funding of the Project, including executing the development work
programme and Business Plan of Kabwe Operations. Jubilee shall in
addition submit designs, construct and operate the plant and shall
process the feed material, including the tailings, at the plant in
order to produce and sell into the market saleable product for
profit, at the direction of Kabwe Operations.
(c) As a result of delays caused by the temporary termination of
BMR's Kabwe mining licence, announced on 7 February 2018 and which
was re-instated as announced on 5 April 2018, Jubilee will prepare
the initial design, work programme and budget for the construction
phase of the Kabwe project by 14 June 2018 at which point it will
make a decision whether to proceed with the plant development. In
the intervening period Jubilee, as operator, will also hold
discussions with the Zambian authorities regarding the proposed
timing of construction and commissioning of the plant in light of
the conditions attached to the mining licence at the time of it
being reinstated.
(d) BMR and/or EPL have ceded, assigned and transferred to Kabwe
Operations the IP in relation to the processing methodology for the
Project (which is licensed to EPL to enable its execution of the
Kabwe project in accordance with the specifications and delivery
plans of Kabwe Operations).
United Kingdom
2 May 2018
Contacts
Jubilee Metals Group PLC
Colin Bird/Leon Coetzer
Tel +44 (0) 20 7584 2155 / Tel +27 (0) 11 465 1913
Andrew Sarosi
Tel +44 (0) 1752 221937
Nominated Adviser
SPARK Advisory Partners Limited
Mark Brady/Andrew Emmott
Tel: +44 (0) 203 368 3555
Broker
Shard Capital Partners LLP
Damon Heath/Erik Woolgar
Tel: +44 (0) 207 186 9900
JSE Sponsor
Sasfin Capital, (a member of the Sasfin group)
Sharon Owens
Tel +27 (0) 11 809 7500
This information is provided by RNS
The company news service from the London Stock Exchange
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