28 Jul 2009 11:21
AQUARIUS PLATINUM LIMITED Exempted Company Number EC26290 ARBN 087 577 892 NOTICE OF GENERAL MEETING and EXPLANATORY MEMORANDUM Date of Meeting: 21 August 2009 Time of Meeting: 9.00 am Place of Meeting: Clarendon House 2 Church Street Hamilton HM11 Bermuda
This Notice of General Meeting and Explanatory Memorandum should be read in
their entirety. If Shareholders are in doubt as to how they should vote, they should seek advice from their accountant, solicitor or other professional
adviser prior to voting. AQUARIUS PLATINUM LIMITED Exempted Company Number EC26290 ARBN 087 577 893 NOTICE OF GENERAL MEETING
Notice is hereby given that a general meeting of Shareholders of Aquarius Platinum Limited (Company) will be held at Clarendon House, 2 Church Street, Hamilton HM11, Bermuda at 9.00 am on Friday, 21 August 2009.
The Explanatory Memorandum which accompanies and forms part of this Notice ofGeneral Meeting describes the various matters to be considered and contains aglossary of defined terms for terms that are not defined in full in this Noticeof General Meeting.AGENDA
1. Resolution 1 - Ratify the issue of Shares under the Placing
To consider, and if thought fit, to pass, with or without amendment, the following resolution:
"That, for the purposes of ASX Listing Rule 7.4 and for all other purposes, theShareholders of the Company approve and ratify the issue of 46,330,000 Shares,on the terms and conditions set out in the Explanatory Memorandum"The Company will disregard any votes cast on this resolution by any person whoparticipated in the issue, and any associate of that person. However, theCompany need not disregard a vote if it is cast by a person as proxy for aperson who is entitled to vote, in accordance with the directions on the proxyform, or it is cast by the person chairing the meeting as proxy for a personwho is entitled to vote, in accordance with a direction on the proxy form tovote as the proxy decides.
2. Resolution 2 - Ratify the issue of Convertible Bonds and approve the issue
of Shares on conversion of the Convertible Bonds
To consider, and if thought fit, to pass, with or without amendment, the following resolution:
"That, for the purposes of ASX Listing Rule 7.4 and for all other purposes, theShareholders of the Company approve the issue of up to 65,000 ConvertibleBonds, each at an issue price of ZAR 10,000, and approve the issue of Shares onconversion of the Convertible Bonds, on the terms and conditions set out in theExplanatory Memorandum"The Company will disregard any votes cast on this resolution by any person whoparticipated in the issue, and any associate of that person. However, theCompany need not disregard a vote if it is cast by a person as proxy for aperson who is entitled to vote, in accordance with the directions on the proxyform, or it is cast by the person chairing the meeting as proxy for a personwho is entitled to vote, in accordance with a direction on the proxy form tovote as the proxy decides.
3. Resolution 3 - Approve the issue of Shares in connection with the
FirstPlats Agreement
To consider and, if thought fit, to pass, with or without amendment, the following resolution:
"That, for the purposes of ASX Listing Rule 7.1 and for all other purposes, theShareholders of the Company approve the issue of 2,732,000 Shares in accordancewith the FirstPlats Agreement, on the terms and conditions as set out in theExplanatory Memorandum"The Company will disregard any votes cast on this resolution by any person whomay participate in the issue and by any person who might obtain a benefit,except a benefit solely in the capacity of a holder of ordinary shares if thisresolution is passed, or by an associate of such persons. However, a person canvote if the vote is cast as proxy for a person who is entitled to vote, inaccordance with the directions on the proxy form, or it is cast by the personchairing the meeting as proxy for a person who is entitled to vote, inaccordance with a direction on the proxy form to vote as the proxy decides.BY ORDER OF THE BOARDWilli BoehmCompany SecretaryDATED: 28 July 2009AQUARIUS PLATINUM LIMITED PROXY FORM
Exempted Company Number EC26290
ARBN 087 577 893
PROXY AND VOTING ENTITLEMENT INSTRUCTIONS
PROXY INSTRUCTIONS
Shareholders are entitled to appoint up to two persons (including a bodycorporate) to act as proxies to attend and vote on their behalf. Where morethan one proxy is appointed each proxy may be appointed to represent a specificproportion of the shareholder's voting rights. If the appointment does notspecify the proportion or number of votes each proxy may exercise, each proxymay exercise half of the votes. If a body corporate is appointed as proxy, thebody corporate may appoint an individual as a representative to exercise itspowers at the meeting.The proxy form (and the power of attorney or other authority, if any, underwhich the proxy form is signed) or a copy or facsimile which appears on itsface to be an authentic copy of the proxy form (and the power of attorney orother authority) must be deposited at or sent by facsimile transmission to oneof the following locations, not less than 48 hours before the time for holdingthe General Meeting, or adjourned meeting as the case may be, at which theindividual named in the proxy form proposes to vote.
Aquarius Platinum Aquarius Platinum Computershare Investor
Corporate Services Pty Limited Services PLC Ltd The Pavilions Codan Services Limited Bridgwater Road PO Box 485 Bristol BS99 6ZY Clarendon House UNITED KINGDOM SOUTH PERTH WA 6951 2 Church Street AUSTRALIA Facsimile (870) 703 6101 Hamilton HM CX Facsimile (618) 9367 5233 BERMUDA Attention: Company Secretary Facsimile (441) 292 4720
The proxy form must be signed by the shareholder or his/her attorney duly authorised in writing or, if the shareholder is a corporation in a manner permitted by the Company's bye-laws and the Companies Act.
The proxy may, but need not, be a shareholder of the Company.
In the case of shares jointly held by two or more persons, all joint holders must sign the proxy form.
A proxy form is attached to this Notice.
VOTING ENTITLEMENT
For the purposes of determining voting entitlements at the General Meeting,shares will be taken to be held by the persons who are registered as holdingthe shares at 5.00 pm, Wednesday, 19 August 2009. Accordingly, transactionsregistered after that time will be disregarded in determining entitlements toattend and vote at the General Meeting.
I/We
_______________________________________________________________________________________________________________________
of
_______________________________________________________________________________________________________________________
being a shareholder/(s) of Aquarius Platinum Limited (Company) and entitled to _____________________________________________ shares in the Company
hereby appoint_____________________________________________________________________________________________________________________
of
_______________________________________________________________________________________________________________________
or failing him/her____________________________________________________________________________________________________________________
of
_______________________________________________________________________________________________________________________
or failing him/her the Chairman as my/our proxy to vote for me/us and on my/ourbehalf at the special general meeting of the Company to be held at ClarendonHouse,
2 Church Street, Hamilton, Bermuda at 9.00 am, Friday, 21 August 2009 and at any adjournment thereof in respect of ___________________________ of
my/our shares or, failing any number being specified, ALL of my/our shares in the Company.
If more than one proxy is appointed, the proportion of voting rights this proxy is authorised to exercise is [ ]%. (An additional proxy form will be supplied by the Company on request.)
In relation to undirected proxies, the Chairman intends to vote in favour of each resolution.
If you do not wish to direct your proxy how to vote, please place a mark in the box.
By marking this box, you acknowledge that the Chairman may exercise your proxyeven if he has an interest in the outcome of a resolution and votes cast by himother than as proxy holder will be disregarded because of that interest. If youwish to indicate how your proxy is to vote, please tick the appropriate placesbelow. If no indication is given on a resolution, the proxy may abstain or voteat his or her discretion.
I/we direct my/our proxy to vote as indicated :
Resolution For Against Abstain
1. Ratify the issue of Shares under the Placing
2. Ratify the issue of Convertible Bonds and approve the issue of
Shares on conversion of the Convertible Bonds
3. Approve the issue of Shares in connection with the FirstPlats Agreement
As witness my/our hand/s day of 2009 this If a natural person:SIGNED by ) in the presence of: Name (Printed) Witness Name (Printed) If a company:EXECUTED by in accordance with Director Director/ its constitution Secretary Name (Printed) Name (Printed) If by power of attorney:SIGNED for and on behalf of Signature of Attorney by under a Power of Attorney dated and who declares that he/she has not Signature of Witness received any revocation of such Power of Attoreny in the presence of AQUARIUS PLATINUM LIMITED Exempted Company NO. EC26290 ARBN 087 577 893 Explanatory Memorandum This Explanatory Memorandum has been prepared for the information of members inAquarius in connection with the business to be conducted at a general meetingof the members of the Company to be held at Clarendon House, 2 Church Street,Hamilton HM11, Bermuda at 9.00 am on Friday, 21 August 2009 (the Meeting).This Explanatory Memorandum should be read in conjunction with, and forms partof, the accompanying Notice of General Meeting. A glossary of terms is includedat the end of this Explanatory Memorandum.
Full details of the resolutions to be considered at the Meeting are set out below.
1. Background
1.1 Summary of the Capital Raising
On 26 March 2009 the Company announced a placing, rights issue and convertiblebond issue (Capital Raising). In total, the Company raised approximately US$269million through the Capital Raising.
a. Key terms of the Placing
The Company raised approximately US$119 million under the Placing. The placingof 46,330,000 Shares (the Placing Shares) represented approximately 14.2% ofthe existing issued common share capital of the Company at the time of issue ofthe Placing Shares, and was offered to both new and existing institutionalinvestors.
The Placing was conducted through an accelerated book-building process and was underwritten as to settlement by Merrill Lynch International and Euroz Securities Limited (Euroz), pursuant to the Placing and Rights Issue Underwriting Agreement. The Placing Shares were issued on 31 March 2009.
b. Key terms of the Rights Issue
The Company raised approximately US$72 million pursuant to the renounceable Rights Issue. The new Shares offered under the Rights Issue (Rights Issue Shares) were offered to all Shareholders holding Shares on the Record Date, other than (subject to certain exceptions) Shareholders with a registered address in an Excluded Territory.
The Rights Issue Shares were offered at a price of A$2.39, 115 pence orZAR15.83 per Share on the basis of 1 Rights Issue Share for every 9 ExistingShares. The Rights Issue was fully underwritten by Merrill Lynch Internationaland Euroz, pursuant to the Placing and Rights Issue Underwriting Agreement.Aquarius received valid acceptances in respect of 40,313,278 Rights IssueShares, representing approximately 97.16% of the total number of Rights IssueShares offered to qualifying Shareholders under the Rights Issue.
c. Key terms of the Convertible Bond Issue
The Company raised a further ZAR650 million (US$78 million) by way of the Convertible Bond Issue. The Convertible Bond Issue was conducted through a private placement managed by Rand Merchant Bank (RMB). The minimum denomination of the Convertible Bonds was ZAR10,000.
RMB agreed to underwrite ZAR500 million of the Convertible Bond Issue, and theCompany granted RMB an option to require the Company to issue additionalConvertible Bonds up to a further value of ZAR150 million. RMB exercised theoption and a total amount of ZAR650 million was raised under the ConvertibleBond Issue.The Company issued the Convertible Bonds on 11 May 2009 and the bonds werelisted on the JSE on 11 May 2009. The obligation to issue Shares on conversionof the Convertible Bonds is conditional on Shareholder approval being obtained,or the Company otherwise being able to issue Shares in compliance with ListingRule 7.1. If Shareholder approval is not obtained for the purposes ofResolution 2, the Company will ensure that at all times it has sufficientauthorised but unissued share capital and sufficient capacity for the purposesof compliance with Listing Rule 7.1 to issue all Shares that may be required tobe issued on conversion of the Convertible Bonds. The Company will not issueany other Shares to the extent that such a Share issue would restrict orotherwise interfere with its ability to issue the Shares on conversion of theConvertible Bonds in compliance with Listing Rule 7.1.
1.2 Reasons for the Placing, Rights Issue and Convertible Bond Issue
During 2008, the Aquarius Group simplified its group structure by removing allminority shareholdings in its subsidiary, AQPSA, through various actions,including the repurchase by Aquarius of Impala Platinum's 20% interest in AQPSAfor US$790 million in April 2008. This repurchase was partly financed through abridging loan (Bridge Loan Facility). The Bridge Loan Facility was due forrepayment on 30 June 2009 and has now been repaid. Approximately US$167 million(ZAR1,577.5 million) of the proceeds of the Placing, Rights Issue andConvertible Bond Issue were applied in repaying the balance owing on the BridgeLoan Facility.On 8 December 2008, Aquarius' management announced the temporary suspension ofoperations at the Everest mine owing to geotechnical issues, namely instabilityas a result of subsidence occurring over an upper area of the mine. However,Aquarius' management believes that the subsidence event does not jeopardise thesustainability of the Everest mine on a long term basis and that technicallyacceptable alternatives exist to re-open the mine. The capital expenditureassociated with the potential restart of the Everest mine is currentlyestimated to be ZAR 200 million to ZAR 250 million.As announced on 27 March 2009, Aquarius signed an implementation agreement withRidge Mining PLC (Ridge) pursuant to which, subject to certain preconditions,Aquarius agreed to make an offer for the entire issued and to be issued sharecapital of Ridge at an exchange ratio of 1 Share for every 2.75 Ridge shares(Possible Acquisition). Ridge has issued a scheme booklet and convened ameeting of Ridge shareholders to consider the Possible Acquisition, which washeld on 6 July 2009. Court approval for the Possible Acquisition is beingsought on 27 July 2009. Should the Possible Acquisition complete, part of theproceeds of the Placing and Rights Issue will be used to fund the operating andcapital expenditure requirements of Ridge.
1.3 Use of proceeds
Of the US$269 million that the Company raised pursuant to the Capital Raising,approximately US$167 million was applied to repaying the Bridge Loan Facility,approximately US$31 million was and will be applied to capital requirements toopen the Everest mine and approximately US$39 million will be applied tocapital and operating expenses for Ridge.
2. Resolution 1 - Ratify the issue of Shares in connection with the Placing
2.1 Background
Section 1 of this Explanatory Memorandum includes details of the Placing which formed part of the Capital Raising that was conducted by Aquarius.
Resolution 1 seeks the approval of Shareholders to ratify the issue of 46,330,000 Shares to raise US$119 million for the purposes of Listing Rule 7.4.
2.2 Listing Rule 7.1 and 7.4
Listing Rule 7.1 broadly provides, subject to certain exceptions, that acompany may not issue or agree to issue securities which represent more that15% of the nominal value of the company's issued share capital at the beginningof any 12 month period without obtaining shareholder approval.A company in general meeting can ratify, by passage of a resolution, a previousissue of securities that was within the 15% limit so that the previous issuecan be treated as having been made with shareholder approval for the purposesof Listing Rule 7.1.Listing Rule 7.4 allows shareholders to validate an issue of securities madewithout prior approval under Listing Rule 7.1 as if it had been made with thatapproval for the purposes of Listing Rule 7.1, but only if: a. the issue did not breach the 15% limit under Listing Rule 7.1 when made; and b. the holders of ordinary securities subsequently approve it.
2.3 Disclosure requirements
In accordance with the disclosure requirements of ASX Listing Rule 7.5, the following information is provided to Shareholders to enable them to consider and ratify the issue of the Placing Shares.
a. The number of Placing Shares allotted was 46,330,000.
b. The Placing Shares were issued at 180 pence per Placing Share. The price of
the Placing Shares in Australian dollars, the currency in which the Shares
are quoted on ASX, was set at A$3.75 per Placing Share.
c. The Placing Shares were allotted to professional and sophisticated
investors, who were not related to the Company.
d. The Placing Shares are fully paid common shares in the Company and rank
equally with, and are on the same terms as, the existing Shares on issue.
Funds raised from the issue of the Placing Shares (together with funds raised from the Rights Issue and Convertible Bond Issue) have been used for the repayment of the Bridge Loan Facility, have and will be used for capital expenditure on the Everest mine and capital and operating requirements in relation to the Possible Acquisition and for working capital and ongoing operations.
3. Resolution 2 - Ratify the issue of Convertible Bonds in connection with the
Convertible Bond Issue and approve the issue of Shares on conversion of the
Convertible Bonds 3.1 Background
Section 1 of the Explanatory Memorandum includes details of the Convertible Bond Issue which formed part of the Capital Raising that was conducted by Aquarius.
Resolution 2 is seeking Shareholder ratification for the issue of ConvertibleBonds and Shares on conversion of the Convertible Bonds, for the purposes ofListing Rule 7.4.
3.2 Listing Rule 7.1 and 7.4
As set out above, Listing Rule 7.1 broadly provides, subject to certain exceptions, that a company may not issue or agree to issue securities which represent more that 15% of the nominal value of the company's issued share capital at the beginning of any 12 month period without obtaining shareholder approval.
Pursuant to Listing Rule 7.4 a company in general meeting can ratify a previousissue of securities that was within the 15% limit so that the previous issuecan be treated as having been made with shareholder approval for the purposesof Listing Rule 7.1.
3.3 Disclosure requirements
In accordance with the disclosure requirements of ASX Listing Rule 7.5, the following information is provided to Shareholders to enable them to consider and ratify the issue of the Convertible Bonds.
a. The number of Convertible Bonds issued was 65,000. The maximum number of
Shares that may be issued on conversion of the Convertible Bonds will be
determined by dividing the principal amount of each Convertible Bond by the
Conversion Price in effect on the relevant Conversion Date. The Base
Conversion Price is ZAR 38.13 per Share. The Base Conversion Price is
subject to adjustment in accordance with certain adjustment formulae which
are summarised in the Schedule under the heading "Conversion Price".
The total number of Shares to be issued on conversion of all of the ConvertibleBonds, assuming the Convertible Bonds are all converted at the Base ConversionPrice, would be 17,046,944 Shares (being ZAR650,000,000 divided by ZAR 38.13).The total number of Shares to be issued on conversion of all of the ConvertibleBonds at the Base Conversion Price would represent 4.11% of the total issuedand fully paid share capital of the Company, based on the total issued andfully paid share capital of the Company immediately following completion of theRights Issue, taking account of the Shares to be issued on Conversion of theConvertible Bonds (17,046,944) and assuming the Company does not undertake anyother issue of Shares.If shareholder approval is not obtained for Resolution 2 the Company will needto ensure during each year of the term of the Convertible Bonds that it hassufficient capacity available under the 15% permitted under Listing Rule 7.1,to issue all of the Shares required on conversion of the Convertible Bondswithout shareholder approval. This would have the effect of restricting theCompany's flexibility in managing future share issues and raising equitycapital.The Convertible Bonds may be converted at any time after the first anniversaryof the Issue Date up to 10 days prior to the final maturity date on 30 April2012. The actual percentage of the total issued share capital of the Company tobe represented by the Shares to be issued on conversion of the ConvertibleBonds will depend on what other share issues are undertaken by the Companyprior to conversion of the Convertible Bonds and any adjustments made to theConversion Price in accordance with the terms of the Convertible Bonds.As noted above, the Conversion Price is subject to adjustment upon theoccurrence of certain events. Generally, these adjustment mechanisms areintended to protect the bondholder from the dilutionary effect of the eventstriggering the adjustment, such as new issues of Shares at a discount, shareconsolidations and the like. One exception to this principle is the adjustmentto the Conversion Price following a change of control event. These adjustmentmechanisms are summarised in the Schedule under the heading "Conversion Price".
b. The Convertible Bonds were issued at ZAR10,000 per Convertible Bond.
c. The Convertible Bonds were issued on the terms and conditions set out in the Schedule. The Shares to be issued on conversion of the Convertible Bonds rank equally with all existing Shares on issue. d. The Convertible Bonds were issued to RMB and to clients of RMB. e. The issue of the maximum number of Convertible Bonds proposed under
Resolution 2 raised ZAR650 million (approximately US$78 million). Funds raised from the issue of the Convertible Bonds have been used to repay in part the Bridge Loan Facility.
4. Resolution 3 - Approve the issue of Shares in connection with the
FirstPlats Agreement
4.1. Background
In February 2009, Aquarius, AQPSA and First Platinum (Pty) Limited (FirstPlats)entered into the FirstPlats Agreement pursuant to which AQPSA will acquire fromFirstPlats a prospecting and mining business for PGMs in the Salene Mining Areaand FirstPlats Mining Area. The consideration for the acquisition wasdetermined by reference to the aggregate cash value of 2,732,000 Shares. Thesale of the business is subject to the transfer of ownership of the relevantmining rights to AQPSA which as per the terms of the agreement, must take placewithin 18 months from 5 February 2009. If, however, AQPSA elects to mine inthose mining areas prior to the conversion and transfer of the mining rightsunder a contract mining arrangement concluded with FirstPlats, the shares willbe issued in tranches at six monthly intervals in proportions which equate tothe extent to which AQPSA has depleted the ore reserve in the mining areas ineach such six monthly period pursuant to such contract mining activities.
Resolution 3 seeks the approval of Shareholders to authorise the issue of 2,732,000 Shares, in connection with the FirstPlats Agreement, for the purposes of Listing Rule 7.1.
4.2 ASX Listing Rule 7.1 Listing Rule 7.1 broadly provides, subject to certain exceptions, that acompany may not issue or agree to issue securities which represent more that15% of the nominal value of the company's issued share capital at the beginningof any 12 month period without obtaining shareholder approval.Accordingly, if Shareholders approve the issue of Shares under Resolution 3,those Shares will not be counted towards the 15% limit in respect of issues ofequity securities in the following 12 month period.
4.3 Disclosure Requirements
In accordance with the disclosure requirements of ASX Listing Rule 7.3, the following information is provided to Shareholders to enable them to approve the issue of the Shares:
a. The maximum number of Shares to be issued pursuant to Resolution 3 is 2,732,000.
b. The issue of Shares will occur no later than 15 months after the date
of this meeting, in accordance with a waiver granted by ASX. c. The deemed issue price of each Share is 92 pence. d. The Shares will be issued to Sunpeak Global Corporation, on the
direction of FirstPlats, in accordance with the terms and conditions of
the FirstPlats Agreement. e. The Shares to be issued by the Company are fully paid common shares in the Company and rank equally with, and are on the same terms as, the existing Shares on issue.
f. No funds are being raised pursuant to the issue of Shares in accordance
with Resolution 3. The Shares are being used as consideration for the
acquisition of a prospecting and mining business for PGMs in the Salene
Mining Area and FirstPlats Mining Area from FirstPlats under the
FirstPlats Agreement.
g. The Board presently intends to issue the Shares pursuant to Resolution
3 as one allotment. However, the Board reserves the right to issue the
Shares progressively. 5. Glossary of Terms
In the Notice of General Meeting and this Explanatory Memorandum the following words and expressions have the following meanings:
AQPSA means Aquarius Platinum (South Africa) (Pty) Ltd, a wholly owned subsidiary of Aquarius incorporated in the Republic of South Africa.
Aquarius Group means Aquarius and each of its subsidiaries and subsidiary undertakings from time to time.
ASX means ASX Limited.
ASX Listing Rules means the official listing rules of ASX.
Base Conversion Price means ZAR38.13
Board means the board of Directors.
Bridge Loan Facility means the bridge facility provided for in the Amended andRestated Facilities Agreement dated on or about 15 April 2008 between AQPSA andFirstRand Bank Limited.
Companies Act means the Companies Act 1981 of Bermuda as amended from time to time.
Company and Aquarius means Aquarius Platinum Limited.
Conversion Price means the Base Conversion Price as adjusted from time to time.The number of Shares to be issued and transferred and delivered on exercise ofa conversion right under the Convertible Bond shall be determined by dividingthe principle amount of the relevant Convertible Bond by the conversion pricein effect on the conversion date. The initial conversion price is the BaseConversion Price. The conversion price shall be adjusted upon the occurrence ofcertain events including, but not limited to, any alteration to the nominalvalue of the Shares as the result of consolidation or subdivision, any rightsor bonus issues and any distribution of capital, including special dividends.Shares to be allotted or transferred, as the case may be, on conversion will beissued or transferred and delivered, as the case may be, credited as fully paidand will rank equally with all other Shares, save that they will not rank forany dividend or other distribution declared or paid or made by reference to arecord date for the payment of a dividend or other distribution with respect tothe Shares prior to the relevant date of conversion.
Convertible Bond Issue means the issue of convertible bonds which raised ZAR650 million.
Convertible Bonds means the convertible bonds issued in accordance with the Convertible Bond Issue and the terms of which are summarised in the Schedule to this Explanatory Memorandum.
Directors means the directors of the Company from time to time.
Excluded Territory means the United States, Canada and Japan.
Existing Shares means Shares on issue on the Record Date.
Explanatory Memorandum means this explanatory memorandum.
FirstPlats means First Platinum (Pty) Ltd, a company incorporated in the Republic of South Africa.
FirstPlats Mining Area means the geographical area comprising of mining authorisation in the form of mining licences to mine for PGMs.
JSE means the JSE Limited, a public company incorporated with limited liabilityunder the laws of the Republic of South Africa, with registration number 2005/022939/06 and licensed as an exchange under the South African SecuritiesServices Act, No. 36 of 2004 as amended, often referred to as the JohannesburgStock Exchange.
LSE means the London Stock Exchange plc.
Impala Platinum means Impala Platinum Holdings Limited registration number 1597 /001979106, a company incorporated in the Republic of South Africa.
Meeting and General Meeting means the general meeting of Shareholders to be held at 2 Clarendon House, 2 Church Street, Hamilton HM11, Bermuda at 9.00 am on Friday, 21 August 2009 or any adjournment thereof.
Notice and Notice of General Meeting means the notice of general meeting which accompanies this Explanatory Memorandum.
PGM means platinum group metals.
Placee means persons who subscribed for Placing Shares pursuant to the Placing.
Placing means the placing of Placing Shares as described in the Explanatory Memorandum.
Placing and Rights Issue Underwriting Agreement means the placing and rightsissue underwriting agreement dated 26 March 2009 between the Company, MerrillLynch International and Euroz relating to the Placing and Rights Issue.
Placing Shares means the Shares issued to Placees pursuant to the Placing as defined in section 1.1(a) of the Explanatory Memorandum.
Record Date means the record date in Australia, the UK and South Africa, being the close of business on 9 April 2009, 31 March 2009 and 9 April 2009 respectively.
Resolution means a resolution in the Notice of General Meeting.
Rights Issue means the offer by the Company of Shares by way of rights to allShareholders, other than (subject to certain exceptions), Shareholders with aregistered address in an Excluded Territory.
Salene Mining Area the geographical area comprising of mining authorisation in the form of mining licences to mine for PGMs.
Securities means any securities including, without limitation, Shares, or options, warrants or other rights to subscribe for or purchase or acquire Shares.
Shareholder means a registered holder of Shares.
Share means a fully paid common share of US$0.05 in the capital of the Company. ZAR means South African Rand, the official currency of South Africa.
Schedule - Terms and Conditions of the Convertible Bonds
Issuer Aquarius Platinum Limited, an exempted company duly incorporated in Bermuda under the Companies Act 1981 of Bermuda with Exempted Company Number EC 26290 on 8 April 1999 and registered as an external company in accordance with the company laws of South Africa with Registration Number 2009/005763/10. Guarantor Aquarius Platinum (South Africa) (Proprietary) Limited, a private company duly incorporated in accordance with the company laws of South Africa with Registration Number 2002/000341/07. Security SPV Lexshell 548 Investments (Proprietary) Limited, a private company duly incorporated in accordance with the company laws of South Africa with Registration Number 2002/006432/07. Description of Bonds Floating Rate Senior Secured Convertible Registered Bonds due 30 April 2012. Issue Price The Convertible Bonds have been issued at 100% (one hundred percent) of their Principal Amount. Authorised Denomination ZAR10,000. Convertible Bonds were only purchased or transferred in integral multiples of ZAR10,000. Issue Date 11 May 2009 (Issue Date). Final Maturity Date Unless previously converted, redeemed or repurchased and cancelled, and other than in the case of an Event of Default, the Convertible Bonds will be redeemed on 30 April 2012 (Final Maturity Date) at their Principal Amount together with accrued and unpaid interest. Redemption by Issuer During the period from the Issue Date and up to the day prior to the first anniversary of the Issue Date, the Issuer may redeem all but not some of the Bonds then outstanding at 115% of their Principal Amount together with accrued interest up to but excluding the date on which such redemption occurs. The Issuer may redeem all but not some of the Bonds on the date specified in the relevant notice of redemption at their Principal Amount together with accrued interest up to but excluding such date - (a) at any time on or after the first anniversary of the Issue Date, if on more than 20 consecutive dealing days the ZAR Volume Weighted Average Price for each such Dealing Day exceeds 128% of the Conversion Price in effect on such Dealing Day; or (b) at any time, if prior to the date on which the relevant notice of redemption is given Conversion Rights shall have been exercised and /or purchases effected in respect of 85% or more in Principal Amount of the Bonds originally issued. The Issuer also has the right to redeem all but not some of the Bonds in the event of certain changes affecting taxation in respect of payments of the Bonds. Redemption at option of Following the occurrence of change of control Bond holder event the holder of each Bond will have the right to require the Issuer to redeem, in cash, that Bond at - a. if the change of control occurs prior to the first anniversary of the Issue Date, 115% of its Principal Amount; and b. if the change of control occurs on or after the first anniversary of the Issue Date, its Principal Amount together with accrued but unpaid interest. Interest The Convertible Bonds bear interest from (and including) the Issue Date at the rate which is the aggregate for each Interest Period of 3-month JIBAR plus a margin of 3% (three percent) per annum. Interest on the Convertible Bonds will be compounded quarterly in arrear and be paid semi-annually in arrear on 30 October and 30 April in each year commencing on 30 October 2009. Conversion Right The holder of each Convertible Bond shall have the right to convert such Convertible Bond into new and/or existing (as determined by the Issuer) Shares of US$0.05 each in the capital of the Issuer, credited as fully paid up. A Bondholder may exercise its Conversion Right only in respect of the Principal Amount of a Convertible Bond that has not already been redeemed or repurchased and cancelled and by delivering a Conversion Notice to the Conversion Agent together with payment of all applicable taxes. Only one Conversion Notice may be delivered by a Bondholder during each calendar month during the Conversion Period. The Conversion Date will be the Johannesburg Business Day after the date of such delivery and payment. Conversion Period The Conversion Right in respect of any Convertible Bond shall be exercisable at any time from the first anniversary of the Issue Date and, except following an Event of Default or unless previously redeemed, converted or purchased and cancelled, up to close of business on the 10th (tenth) day prior to the Final Maturity Date. The Conversion Right in respect of any Convertible Bond may not be exercised where the resulting Conversion Date would fall during a closed period for Common Shares or during the period commencing on a day which is 10 (ten) days prior to an Interest Payment Date, and ending on the Interest Payment Date, both days inclusive. Base Conversion Price The Base Conversion Price is ZAR38.13 (Base Conversion Price). Conversion Price The number of Common Shares to be issued or transferred and delivered on exercise of a Conversion Right shall be determined by dividing the Principal Amount of the relevant Bond by the Conversion Price in effect on the Conversion Date. The initial Conversion Price is the Base Conversion Price. The Conversion Price shall be adjusted upon the occurrence of certain events including but not limited to the following: (a) a consolidation, reclassification or subdivision in relation to Shares in which case the Conversion Price shall be adjusted proportionally for the change in issued share capital; (b) an issue of Shares, credited as fully paid, to Shareholders by way of capitalisation of profits or reserves (including any share premium account or capital redemption reserve) other than where the Shareholder could have elected to receive a cash dividend instead of the Shares, in which case the Conversion Price shall be adjusted proportionally for the change in issued share capital; (c) an issue or payment of a capital distribution including any dividends in a financial year in excess of 5% of the volume weighted average price of a Share, or any special dividend and similar distributions, in which case the Conversion Price shall be adjusted by a fraction to reflect the current market price of the Shares before the issue of such distribution less the fair market value of such distribution; (d) an issue of Shares to Shareholder by way of rights issue or issue or grant to Shareholders of options, warrants or other rights to Shares at a price less than 90% of the then current market price of the Shares in which case the Conversion Price shall be adjusted by a fraction to reflect the current market price of the Shares before the issue of such Securities or rights less the fair market value of such Securities or rights; (e) an issue of any Securities (other than Shares or options, warrants or other rights to Shares) to Shareholders as a class by way of rights or the grant to Shareholders by way of rights of options, warrants or other rights to such Securities in which case the Conversion Price shall be adjusted by a fraction to reflect the current market price of the Shares before the issue of such Securities or rights less the fair market value of such Securities or rights; (f) an issue wholly for cash or no consideration of any Shares (other than under (d) above) or options, warrants or other rights to Shares at a price per Share less than 90% of the then current market price of the Shares in which case the Conversion Price shall be adjusted proportionally for the change in issued share capital; (g) the issue, wholly for cash or no consideration of any Securities convertible to, exchangeable with or which may be redesignated as Shares at a conversion or exchange price per Share less than 90% of the then current market price of the Shares at the time of issue of the Securities in which case the Conversion Price shall be adjusted proportionally for the change in issued share capital that would occur on conversion or exchange of the Securities at that market price compared to the conversion price; (h) if there is a modification of the rights of conversion, exchange or subscription attaching to any Securities referred to at (g) above which reduces the consideration received below 90% of the current market price of the Shares at the date of announcing such modification, in which case the Conversion Price shall be adjusted proportionally for the change in issued share capital that would occur on conversion or exchange of the Securities at that market price compared to the modified price; (i) any offer of Securities by the Company, a subsidiary or other company in connection with which Shareholders as a class are entitled to participate whereby such Securities may be acquired by them (and where the Conversion Price is not adjusted under other adjustment clauses) the Conversion Price shall be adjusted by a fraction to reflect the current market price of Shares before the announcement of the relevant offer or issue of Securities and the fair market value of the portion of the offer attributable to each Share; (j) if the Company determines an adjustment should be made to the Conversion Price as a result of circumstances not referred to in paragraphs (a) to (i) above, the Company shall request an independent expert to determine a fair and reasonable adjustment to the Conversion Price. In addition to the above adjustments, which are each intended to protect the holder of the Convertible Bond from the potential dilutionary effect of other issues of Shares or Securities or adjustments to the rights under other instruments, the Conversion Price will also be adjusted for a Change of Control event. If an offer is made to all (or nearly all) Shareholders, to acquire all or the majority of the issued share capital of the Company or any persons propose a scheme of arrangement with respect to such an acquisition and more than 50% of the voting rights of the issued Shares will become vested in the offeror, then if the holder of the Convertible Bond exercises their conversion rights within 60 days of the change of control event then the Conversion Price shall be adjusted - (a) if the change of control event is during the second year of the term of the Convertible Bond, between 30 April 2010 and 30 April 2011, then to 90% of the previous Conversion Price; and (b) if the change of control event is during the third and final year of the term of the Convertible Bond, between 30 April 2011 and 30 April 2012, then to 95% of the previous Conversion Price. Common Shares to be allotted or transferred, as the case may be, on conversion will be issued or transferred and delivered, as the case may be, credited as fully paid and will rank pari passu with all other Common Shares, save that they will not rank for any dividend or other distribution declared or paid or made by reference to a record date for the payment of a dividend or other distribution with respect to the Common Shares prior to the relevant Conversion Date. Use of Proceeds The Issuer has used the proceeds to partially fund the advance of an interest bearing shareholder loan (Serviced Shareholder Loan) to the Guarantor pursuant to a Shareholder Loan Agreement dated on or about 2 April 2009 between the Issuer and the Guarantor (Serviced Shareholder Loan Agreement) and for general corporate purposes. The Guarantor has used the amount advanced under the Serviced Shareholder Loan Agreement towards repayment of the Bridge Loan Facility. Negative Pledge The Conditions of the Bonds contain negative pledge provisions which restrict the Guarantor's ability to create security interests and incur financial indebtedness except in certain limited circumstances. The Issuer and Guarantor are also restricted from paying distributions, advancing loans or making payments unless after such payments certain minimum levels of cash on hand are achieved. Status of the Bonds The Bonds are direct, senior, unconditional and secured indebtedness of the Issuer and rank pari passu amongst themselves. To the extent the proceeds of the Transaction Security provided by the Issuer are insufficient to discharge the Issuer's obligations under the Bonds, the claims of the Bondholders in respect of such shortfall will at all times rank at least equally with all other present and future unsecured and unsubordinated obligations of the Issuer from time to time outstanding, save for such obligations as may be preferred by provisions of law that are both mandatory and of general application. Subsidiary Guarantee The Guarantor, which is a Wholly Owned Subsidiary of the Issuer, has irrevocably guaranteed to the Trustee for the benefit of the Bondholders the due and punctual payment by the Issuer of all amounts owing by the Issuer in respect of the Bonds (Subsidiary Guarantee). Status of the Subsidiary The Subsidiary Guarantee is an irrevocable Guarantee senior and secured obligation of the Guarantor. To the extent the proceeds of the Transaction Security provided by the Guarantor are insufficient to discharge the Guarantor's obligations under the Subsidiary Guarantee, the claims of the Bondholders (subject to the Security SPV Guarantee, the Counter Indemnity Agreements and the Transaction Security provided by the Guarantor for its obligations under the Counter Indemnity Agreements) in respect of such shortfall will, at all times, rank at least equally with all other present and future unsecured and unsubordinated obligations of the Guarantor from time to time outstanding, save for such obligations as may be preferred by provisions of law that are both mandatory and of general application. Security SPV Guarantee The Security SPV has irrevocably guaranteed to the Trustee for the benefit of the Bondholders the due and punctual payment by the Guarantor of all amounts owing by the Guarantor under the Subsidiary Guarantee on a limited recourse basis (Security SPV Guarantee). Counter Indemnity The Guarantor has agreed to indemnify the Agreements Security SPV in respect of any claims made against the Security SPV under the Security SPV Guarantee pursuant to written counter indemnity agreements entered into between the Security SPV and the Guarantor (Counter Indemnity Agreements). The Guarantor has also, in terms of the Counter Indemnity Agreements, agreed to indemnify the Security SPV against claims made against the Security SPV under a guarantee (FNB Guarantee) issued to FirstRand Bank Limited (acting through its First National Bank division) FNB as security for the obligations of the Guarantor under a guarantee facility (FNB Guarantee Facility) and the Additional Guarantees (as defined below). Status of the Counter The Counter Indemnity Agreements are Indemnity Agreements irrevocable senior and secured obligations of the Guarantor. To the extent the proceeds of the transaction security provided by the Guarantor for its obligations under the Counter Indemnity Agreements are insufficient to discharge the Guarantor's obligations under the Counter Indemnity Agreements, the claims of the Security SPV (subject to the Issuer Guarantee and the transaction security provided by the Issuer for its obligations under the Issuer Guarantee) in respect of such shortfall will, at all times, rank at least equally with all other present and future unsecured and unsubordinated obligations of the Guarantor, from time to time outstanding, save for such obligations as may be preferred by provisions of law that are both mandatory and of general application. Issuer Guarantee The Issuer has irrevocably guaranteed to the Security SPV the due and punctual payment by the Guarantor of all amounts owing by the Guarantor in respect of the Counter Indemnity Agreements Intercreditor Agreement The Security SPV has issued the Security SPV Guarantee and the FNB Guarantee, and will be permitted by the terms of an Intercreditor Agreement dated on or about the Issue Date between the Issuer, the Guarantor, the Security SPV, the Trustee and FNB to issue the Security SPV Guarantee and additional guarantees securing indebtedness of the Guarantor up to a maximum aggregate principal amount of indebtedness from time to time of ZAR900,000,000 (inclusive of the amount outstanding under the Convertible Bonds from time to time and the amounts payable under the FNB Guarantee Facility from time to time) (Additional Guarantees). The Intercreditor Agreement, inter alia, governs the relationship between the Bondholders, FNB and the additional lenders to whom such additional guarantees are issued. Trust Deed The Convertible Bonds are constituted by a Trust Deed dated 26 March 2009 between the Issuer, the Guarantor, the Security SPV and Maitland Trust Limited as Trustee. Events of Default Certain events defined as Events of Default in the terms of the Convertible Bonds permit acceleration of the Convertible Bonds. These events are considered relatively standard for convertible bonds of this type and include a failure to pay principal or interest under the Convertible Bond terms or associated transaction documents, non-payment or acceleration of other financial indebtedness above certain thresholds, enforcement proceedings occurring, insolvency events occurring and similar events. Upon acceleration for any such event, the Convertible Bonds will become immediately due and repayable at their Principal Amount, together with accrued and unpaid interest. Manager FirstRand Bank Limited (acting through its Rand Merchant Bank division), a public company and registered bank duly incorporated with limited liability in accordance with the company and banking laws of South Africa with Registration Number 1929/001225/06 (RMB). Underwriter RMB. Paying Agent RMB or such other paying agent as may be appointed by the Issuer from time to time. Conversion Agent RMB or such other conversion agent as may be appointed by the Issuer from time to time. Calculation Agent RMB or such other calculation agent as may be appointed by the Issuer from time to time. Currency South African Rand (ZAR). Governing Law The Bonds and the Trust Deed will be governed by, and construed in accordance with, the laws of South Africa. Listing and Trading The Convertible Bonds are listed on the JSE. Transaction Security The Issuer will provide direct and indirect security for its obligations under the Convertible Bonds over its entire shareholding in, and its claims on loan account under the Serviced Shareholder Loan against, the Guarantor (including, without limitation, its claims in respect of the Serviced Shareholder Loan under the Serviced Shareholder Loan Agreement). The Guarantor will create a sinking fund (in the form of cash and/or Permitted Investments (as defined in the Trust Deed)) (Required Sinking Fund Security) in prescribed amounts and by no later than prescribed dates (in accordance with the terms of the Trust Deed). The Guarantor will provide security in favour of the Security SPV for its obligations under the Counter Indemnity Agreements.
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