ENP Newswire -
Release date- 14022014 - South African coal production company
The funds have been received by the Company's escrow agent and all conditions met, allowing for the funds to be released so as to meet key payments to current creditors and ensure a 3 month standstill period to recapitalize the Company and restructure its financial arrangements.
Importantly the Company will focus on, and ensure, stability at an operational level with the Company's current mining operations whilst saving significant costs at the corporate level. As part of the restructure process, Continental will look to strengthen its BEE credentials in
Commenting on the closing of the bridge financing and the associated board changes, interim Chairman Dr
'We have complete faith in the assets and operational management of the Company, but believe a range of strategic and financing opportunities can be advanced so as to stabilise the Company's balance sheet and focus on significant growth following completion of the proposed rights issue,' Dr D'Sylva added.
Board and Management Changes
The following individuals have now been appointed to the Board as new directors of the Company:
The Board representative from the creditors group has not been finalised as yet. As previously announced as a condition to the funding, the resignation or termination of the current CEO Mr
Following the new appointments, the Board of the Company will be comprised of:
Mr Connie Molusi (Non-Executive Director)
Creditors' representative (Non-Executive Director) - to be appointed
The management structure of the Company moving forward is still being considered by the reconstituted Board, but will initially be overseen by
The Company also advises that Ms
The Company's new registered office address and contact details are as follows:
West Perth WA 6005
PO Box 684
West Perth WA 6005
Phone +61 8 9488 5220
Fax +61 8 9324 2400
ASX and AIM Share Trading Suspensions
The shares of the Company will remain suspended from trading on both the ASX and AIM markets. The reconstituted Board of Directors will consider a decision on seeking to lift the suspension of the shares following the closing of the transaction and pending the provision of further clarification of its financial position to the market.
Key Terms of the Bridge Funding
The funding has been provided by three unrelated institutional and industry investors (the 'Investors'). The Investors subscribed for 7.5 million unsecured convertible promissory notes ('Notes') with a face value of
The Investors have also undertaken to assist the Company in undertaking a rights issue, currently proposed to raise up to
The Notes are only redeemable upon successful completion of the rights offer, being full subscription including underwriter subscriptions, upon which the Investors will have the option to redeem the Notes by either conversion into shares in the Company (subject to obtaining necessary shareholder approvals) at a conversion price equal to the rights offering price or request payment of the
The existing convertible note holders, with outstanding principal and interest of
The Investors will receive a 6% fee on the Investment Amount as well as 70 million options, subject to shareholder approval, for providing the
Tel: +61 8 9388 0944
Tel: +61 8 9480 2500
Forward Looking Statement
This communication includes certain statements that may be deemed 'forward-looking statements' and information. All statements in this communication, other than statements of historical facts, that address future production, reserve potential, exploration drilling, exploitation activities and events or developments that the Company expects to take place in the future are forward-looking statements and information.
Although the Company believes the expectations expressed in such forward-looking statements and information are based on reasonable assumptions, such statements are not guarantees of future performance and actual results or developments may differ materially from those in the forward-looking statements and information.
Factors that could cause actual results to differ materially from those in forward-looking statements include market prices, exploitation and exploration successes, drilling and development results, production rates and operating costs, continued availability of capital and financing and general economic, market or business conditions. Investors are cautioned that any such statements are not guarantees of future performance and actual results or developments may differ materially from those stated.
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