Last checked at 5 Mar 2009 07:00
AIM: EMED Thursday 5 March 2009
Convertible Secured Loan Facility of up to $8.5 million and Extraordinary General Meeting
The Directors of EMED Mining Public Limited ("EMED Mining" or the "Company") are pleased to announce a proposed $8.5 million Convertible Secured Loan Facility that will, if approved, provide working capital that will be targeted primarily at the Detva Gold project in Slovakia and the Rio Tinto Mine in Spain. At this time:
The Company has entered into a conditional secured convertible loan agreement with Resource Capital Fund IV L.P. ("RCF") and RMB Australia Holdings Limited ("RMB") for a facility of up to $8.5 million.
The Company has agreement in principle to amendments to existing loan arrangements with YA Global Investments L.P. ("YA") and certain agreements entered into with Marc Rich + Co. Investment AG ("MRI") and related companies.
Each of these arrangements may require the Company to issue Ordinary Shares which requires Shareholder approval. Accordingly, an extraordinary general meeting of EMED Mining is to be held at 10.00 a.m. on 23 March 2009 at the registered office of the Company, which is located at 1 Lambousa Street, 1095 Nicosia, Cyprus. Further details of the arrangements are set out below.
The Company has today despatched a circular to shareholders convening the EGM (the "Circular"). Copies of the Circular will be available, free of charge, at the registered office of the Company at 1 Lambousa Street, 1095 Nicosia, Cyprus during normal business hours on any weekday until 5 April 2009 (Saturdays, Sundays and public holidays excepted) and from www.emed-mining.com.
Commenting, Harry Anagnostaras-Adams, Managing Director of the Company said:
"The convertible loan facility with RCF and RMB, two long-standing shareholders of the Company, is intended to provide the finance required for the 2009 business plan and budget of the Company aimed principally at progressing the Company's two wholly-owned core assets:
Detva Gold Project in Slovakia (JORC-Code Compliant Mineral Resources containing 1.1 million ounces of gold - see Appendix A); and
Rio Tinto Mine ("Proyecto de Rio Tinto") in Spain (JORC-Code Compliant Mineral Resources containing 940,000 tonnes of copper - see Appendix A).
The loan agreement with YA, a core financier to the Company, was entered into in December 2007. Since then an initial $5 million advance has been repaid as to $1.5 million and the remaining balance of $3.5 million is repayable over the course of 2009 in cash or shares at the Company's election.
The agreements with MRI were entered into in September 2008 when the Company acquired 100% beneficial ownership in the Rio Tinto Mine, via its wholly-owned subsidiaries in the UK and Spain. It is proposed that the agreements be amended to reduce the project finance required for the restart of the Rio Tinto Mine. MRI is also the copper sales and marketing agent for the Rio Tinto Mine.
This package of initiatives represents part of the Company's response to the global financial crisis and reflects active support for the Company from shareholders (RCF and RMB), financier (YA), the Rio Tinto Mine vendor, the sales and marketing agent (MRI), the Board and Management.
It is pleasing that the Company is so strongly supported and it is encouraging that the gold and copper sectors are amongst the best performing asset classes internationally so far in 2009. "
Capitalised terms used in this announcement shall, unless the context otherwise requires, bear the same meaning as defined in the Circular.
Enquiries
| EMED Mining | Fox-Davies Capital | RFC Corporate Finance | Bishopsgate Communications |
| Harry Anagnostaras-Adams | Jason Bahnsen | Stuart Laing | Nick Rome |
| +357 9945 7843 | +44 (0)207 936 5230 | +618 9480 2500 | +44 (0)207 562 3350 |
The Facility
The Company is proposing to borrow up to $8.5 million from the Lenders. RCF is to provide a total loan amount of $6.5 million under the Facility and RMB is to provide $2 million. The Facility is repayable on or prior to 30 December 2011. Amounts drawn down under the Facility may be converted at the discretion of each Lender into Ordinary Shares at the Conversion Price.
The Company will pay an establishment fee of $212,500 and an annual commitment fee of 3.0 per cent on any undrawn amounts. Interest on funds drawn down is 7.5%. The establishment fee will be paid by the issue of 3,785,274 new Ordinary Shares at a price of 3.969 pence per share. Interest can be paid in cash or shares at the election of the Company or the Lenders. In the case of shares, the price of such shares will be based upon the volume weighted average market price at the time of the payment.
RCF is entitled to nominate one Director to the board of Directors of the Company while its conversion rights, together with any holding of Ordinary Shares, result in an interest in over five per cent of the issued Ordinary Shares, on a fully diluted basis. Where such interest exceeds 20 per cent RCF is entitled to nominate two Directors.
Drawdown of the Facility under the Convertible Loan Agreement is subject to conditions precedent, as set out in more detail in Appendix C of this announcement. Any funds borrowed under the Facility will be used as follows:
to repay the promissory notes totalling $1 million provided by the Lenders as bridging finance as announced on 12 February 2009;
to fund the advancement of the Company's Proyecto de Rio Tinto copper project in Andalucia, Spain, and various gold projects in Slovakia; and
for general working capital purposes.
Further details of the Facility and the terms of the Convertible Loan Agreement are set out in Appendix C of this announcement.
RCF currently holds 35,282,667 Ordinary Shares (representing 14.29 per cent of the Company's current issued share capital) and RMB currently holds 10,232,902 Ordinary Shares (representing 4.14 per cent. of the Company's current issued share capital). Assuming full conversion of the Facility and payment of the establishment fee in Ordinary Shares (but disregarding any Ordinary Shares which may be issued in satisfaction of interest payments or in satisfaction of the commitment fee payable on undrawn amounts) RCF and RMB would be interested in approximately 37.32 per cent and 12.04 per cent respectively of the Company's issued share capital (as enlarged by the issue of Ordinary Shares to RCF and RMB but assuming no exercise of options or warrants and no issue of further Ordinary Shares).
Arrangements with YA
On 18 December 2007, the Company entered into the YA Loan Agreement pursuant to which YA agreed to advance the sum of $5,000,000 to the Company. As at today's date, $3,500,000 remains outstanding. Under the YA Loan Agreement the Company requires YA's consent to enter into the Convertible Loan Agreement. In consideration of such consent being given it is proposed that the Company shall agree to: (i) amend the conversion price under the YA Loan Agreement so as to give YA the right to convert outstanding amounts owing into Ordinary Shares at the Conversion Price; (ii) amend the subscription price relating to YA's right to subscribe for one million Ordinary Shares from 50 pence to 5 pence per share; (iii) grant YA security equivalent to that being granted to the Lenders under the Convertible Loan Agreement; and (iv) grant certain cross-default provisions to YA to allow it to declare a default of the YA Loan Agreement (as it is proposed to be amended) in the event that an event of default has been declared under the Convertible Loan Agreement. In order to effect these arrangements, it is proposed that the Company and YA shall enter into the Consent Agreement, which shall also amend the YA Loan Agreement. It is proposed that the Consent Agreement will be subject to certain conditions including the satisfaction of the conditions precedent in the Convertible Loan Agreement relating to drawdown to Tranche A.
YA does not currently hold any Ordinary Shares. Assuming YA converts all amounts outstanding under the YA Loan Agreement (as proposed to be amended) into Ordinary Shares it will be interested in approximately 12.99 per cent of the Company's issued share capital (as enlarged by such issue of shares to YA and assuming full conversion of the Facility by the Lenders, the payment of the establishment fee in Ordinary Shares as referred to above but no exercise of options or warrants and no issue of further Ordinary Shares).
Arrangements with MRI
On 30 September 2008, the Company acquired from MRI and its associated companies (the "MRI Group") the remaining 49 per cent of the share capital of its subsidiary EMED Tartessus, thereby acquiring 100 per cent ownership of EMED Tartessus which owns 100 per cent of the Rio Tinto project.
Pursuant to the arrangements entered into with the MRI Group, EMED Tartessus is obliged to pay up to a further €53 million of deferred payments in the following instalments:
€26,650,000 when both (i) the authorisation from the Junta de Andalucia to restart mining activities at the Rio Tinto Mine has been granted and (ii) senior debt finance has been secured for the acquisition and re-start of mining operations at the Rio Tinto Mine ("First Payment Date");
€13,175,000 following the first anniversary of the restart of mining activities at the Rio Tinto Mine at an agreed level ("Restart"); and
€13,175,000 following the second anniversary of Restart.
Under the revised arrangements proposed to be entered into with the MRI Group, the payment to be made on the First Payment Date will be €8,833,333 with the balance of the consideration being paid in equal annual or quarterly instalments over the following six years (the "Payment Period"). In consideration of agreeing to defer the above instalments and for MRI's consent to the arrangements being entered into in connection with the Facility, it is proposed that the Company will agree to potentially pay further deferred consideration of up to €15,900,000 in regular instalments over the Payment Period depending upon the price of copper. Any such additional payment will only be made if, during the relevant period, the average price of copper per tonne is $6,613.86 or more. For these purposes, the average price of copper per tonne shall be calculated by reference to the London Metal Exchange Copper Grade A Cash Seller and Settlement price of copper adjusted, where relevant, for the price of copper per tonne in any agreements entered into by EMED Mining or its subsidiaries to hedge their exposure to variations in the price of copper.
It is proposed that the above changes to the arrangements with the MRI Group will be conditional upon the satisfaction of the conditions precedent in the Convertible Loan Agreement relating to drawdown of Tranche A.
Options
Further to the original arrangements with MRI referred to above EMED Mining and MRI will enter into an option agreement whereby MRI will be granted, subject to shareholder approval: (i) an option to subscribe at any time until 23 March 2011 for up to 1,000,000 Ordinary Shares at a subscription price per Ordinary Share of 24.5p; and (ii) an option to subscribe at any time until 23 March 2011 for up to 1,000,000 Ordinary Shares at a subscription price per Ordinary Share of 28p. As the Company did not have requisite share authorities at the time the MRI arrangements were entered into it was agreed to grant these options to MRI at the time the next general meeting of the Company was convened.
The Company has agreed to grant, subject to shareholder approval an option to a consultant in return for assisting the Company in connection with certain commercial matters and with permitting, whereby an option to subscribe for up to 750,000 new Ordinary Shares at a subscription price of 5p per Ordinary Share will be granted.
In addition, each of the Directors and certain of the employees have been or are to be granted options to subscribe at any time until 23 March 2013 for an aggregate total of 10,000,000 Ordinary Shares at a subscription price per Ordinary Share of 4.13 pence, subject to shareholder approval at the EGM.
As previously announced in the Company's December 2008 quarterly report, the cash remuneration of the Directors and the Company's senior executives has been significantly reduced. Options are being granted, inter alia, to compensate the Directors and senior employees for this reduction and provide an appropriate performance incentive whilst conserving the Company's cash. The quantum and terms of Options to be issued have been determined having regard to the cash remuneration reduction and other general compensation considerations.
Details of the Options conditionally granted or to be granted to each Director and their revised option entitlements are set out below.
| Name | Existing Options | New Options | Aggregate Options |
| Ronnie Beevor | 2,350,000 | 1,000,000 | 3,350,000 |
| Harry Anagnostaras-Adams | 11,000,000 | 2,000,000 | 13,000,000 |
| John Leach | 2,050,000 | 1,250,000 | 3,300,000 |
| Gordon Toll | 1,650,000 | 500,000 | 2,150,000 |
| Ashwath Mehra | - | 500,000 | 500,000 |
| Ross Bhappu | - | 500,000 | 500,000 |
The existing options referred to above have been granted at exercise prices of between 8 pence and 22 pence per Ordinary Share.
Extraordinary General Meeting
At the EGM resolutions will be proposed to increase the Company's authorised share capital and to authorise the Directors to allot Ordinary Shares pursuant to the arrangements described above.
Recommendation
The Independent Directors consider the grant to them of these powers to be in the best interests of the Company and its Shareholders and have recommend Shareholders to vote in favour of those Resolutions at the EGM as they intend to do in respect of a total of 16,726,667 Ordinary Shares held by them (representing approximately 6.77 per cent of the current issued ordinary share capital of the Company).
Both RCF and MRI are related parties under the AIM Rules by virtue of their shareholdings in the Company. Each of the entries into the Convertible Loan Agreement, the variation of the arrangements with MRI and the grant of Options to MRI constitute related party transactions. Where a company whose shares are traded on AIM enters into a related party transaction the Directors independent of the transaction are required to consider, having consulted with the company's nominated adviser, that the terms of the transaction are fair and reasonable insofar as its shareholders are concerned. Ross Bhappu is a partner in RCF and Ashwath Mehra is a Director and major shareholder of MRI and accordingly they have not taken part in the consideration and approval of the above-mentioned related party transactions.
The Independent Directors consider, having consulted with RFC Corporate Finance Ltd, the Company's nominated adviser, that the transactions and proposed transactions with each of RCF and MRI referred to above are fair and reasonable insofar as Shareholders are concerned.
APPENDIX A
Mineral Resource Statements and Competent Persons
Detva Gold Project in Slovakia
| | | | |
| | |||
| Resource Category | Tonnes (millions) | Gold Grade (g/t) | Contained Gold (ounces) |
| Oxide (cut-off grade = 0.22g/t gold) | |||
| Indicated | 12.6 | 0.85 | 345,000 |
| Inferred | 13.1 | 0.77 | 322,000 |
| Total | 25.7 | 0.81 | 667,000 |
| Primary (cut-off grade = 0.34g/t gold) | |||
| Indicated | 5.1 | 0.71 | 116,000 |
| Inferred | 10.9 | 0.78 | 274,000 |
| Total | 16.0 | 0.76 | 390,000 |
| Oxide + Primary | |||
| Indicated | 17.7 | 0.81 | 461,000 |
| Inferred | 24.0 | 0.77 | 596,000 |
| Grand Total | 41.7 | 0.79 | 1,057,000 |
The above Mineral Resource estimate for the Detva Gold Project has been completed in accordance with the 2004 Edition of the Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves (the "JORC Code") and has been reviewed and approved for release by Mr Ron Cunneen, B.Sc. (Honours). Mr Cunneen is Head of Exploration for EMED Mining and has more than 20 years' relevant experience in the field of activity concerned. He is a member of The Australian Institute of Geoscientists ("AIG") and has consented to the inclusion of the material in the form and context in which it appears.
Rio Tinto Mine, Copper Project in Spain
| Tonnes (Mt) | Cu Grade (%) | Cu Tonnes (000s) | |
| Measured | 48 | 0.38 | 180 |
| Indicated | 155 | 0.48 | 750 |
| Inferred | 2 | 0.50 | 10 |
| Total | 205 | 0.46 | 940 |
The above Mineral Resource estimate for the Rio Tinto Project has been completed in accordance with the JORC Code and is based on information compiled by Mr Pat Stephenson, BSc (Geology) and Mr Ron Cunneen, BSc (Geology), Mr Stephenson taking responsibility for the Mineral Resource estimates and Mr Cunneen taking responsibility for the data on which the estimates are based. Mr Stephenson is Regional Manager, Vancouver and Principal Geologist with AMC Mining Consultants (Canada) Ltd and a full-time employee of that company. He is a Fellow of The Australasian Institute of Mining and Metallurgy. Mr Cunneen is Head of Exploration for EMED Mining and a full-time employee of that company. He is a Member of The Australian Institute of Geoscientists. Mr Stephenson and Mr Cunneen have sufficient experience relevant to the style of mineralisation and type of deposit under consideration and to the activities which they are undertaking to qualify as Competent Persons as defined in the JORC Code. Mr Stephenson and Mr Cunneen have reviewed the Mineral Resource estimate and consent to the inclusion in the announcement of the matters based on their information in the form and context in which it appears.
APPENDIX B
Notes to Editors: about EMED Mining Public Limited
EMED Mining was admitted to trading on AIM in May 2005. The Company is based in Cyprus and has a strong commitment to responsible development of metal production operations in Europe, with an initial focus on copper and gold.
The Group's region of interest are the tectonic belts spanning across Europe and over to the Middle East. The strategy is to evaluate exploration and development opportunities in several jurisdictions throughout this quality mineral belt and to promote sustainable development practices through the implementation of European Union and other leading-edge international standards. The Company strictly implements its Environmental & Community Policies which includes:
Integrating environmental management into our business, planning and reporting processes.
Promoting a strong environmental ethic throughout the Company and the community.
Complying with, as a minimum, all applicable local and European Union laws and regulations.
Communicating with community stakeholders in a responsible and transparent manner.
EMED Mining has now established a strong position in the following selected zones:
Exploration areas in Slovakia are centered on a cluster of volcanic centres. Low-detection geochemical methods are being applied to these areas for the first time together with open-pit bulk mining concepts. The principal targeted mineralisation style is low-grade, bulk-mineable porphyry gold. The Company has announced a significant gold discovery at Biely Vrch and the identification of many targets with apparently similar geological characteristics in its wholly-owned exploration licences in Central Slovakia.
The mines in Cyprus and in Spain in the Iberian Pyrite Belt are probably among the best known in the world for their copper mineral endowment. EMED Mining's goal is to restart copper production at its projects in both of these well-endowed, historical mining districts. Both Spain and Cyprus are progressive members of the European Union and EMED Mining has been made to feel welcome in both host countries. The styles of mineral deposits and production techniques are similar in both mining districts.
Exploration areas in Turkey were vended into 32%-owned KEFI Minerals Plc which was admitted to AIM in December 2006. KEFI Minerals owns carefully selected licence areas in Turkey, as well as an extensive proprietary database of regional and specific exploration data providing a pipeline of further projects to evaluate. It recently announced a joint venture at the Artvin Project with Centerra Gold Inc of Canada and is considering other opportunities in the region. See www.kefi-minerals.com.
For further information on the Company's activities, visit www.emed-mining.com or www.emed.tv.
APPENDIX C
Terms of the Convertible Loan Agreement
Set out below is a summary of the principal terms of the Convertible Loan Agreement. The Facility is divided into two tranches of which Tranche A comprises $2 million and Tranche B up to $6.5 million. RCF is to provide a total loan amount of $6.5 million under the Facility and RMB is to provide $2 million, with each Tranche being provided by the Lenders pro rata to these total amounts. The obligation of each Lender to advance its pro rata share of each Tranche is conditional upon the concurrent advance by the other Lender of its own pro rata share of that Tranche.
Conditions precedent
Any drawdown under the Facility is subject to conditions precedent including the following:
the representations and warranties made by the Company and certain of its subsidiaries (details of which are included under the sub-section "Representations and Warranties" below) being true on the date of each drawdown;
no event of default or potential event of default having occurred and continuing on the date of a drawdown;
no litigation, bankruptcy, insolvency, order or claim affecting the Company, its subsidiaries or any Project which could have a material adverse effect;
none of the Company, its subsidiaries or a Project having suffered a material adverse effect; and
the passing by Shareholders of the Resolutions.
In addition, drawdown of loans under each Tranche are subject to a set of conditions precedent, including the following:
Tranche A conditions
The conditions to drawdown of Tranche A of the Facility include: the provision of guarantees from the company's subsidiaries and the provision of security over certain of the Company's holdings in its subsidiaries and certain assets of the Company or of its subsidiaries in Cyprus, Spain and Slovakia in a form to be agreed; the provision of legal opinions in forms to be agreed; the entry into several intercreditor arrangements between the Company, YA, MRI, RCF and RMB in forms to be agreed; the Lenders being satisfied with the status of the Company's resolution of certain commercial matters related to the Proyecto de Rio Tinto; the Lenders' completion of (and satisfaction with) the results of their due diligence on the Company and the Projects and continuing compliance with the terms of the Convertible Loan Agreement and other loan and security documents. In addition, the Company is required to have entered into definitive agreements to amend the existing arrangements between it and each of YA and MRI as described above.
Tranche B conditions
The conditions to drawdown of Tranche B of the Facility include: Tranche A having been advanced to the Company; and the Lenders being satisfied with the status of the Company's resolution of a number of commercial issues associated with the Proyecto de Rio Tinto.
Availability
The Facility will be available to be drawn down in the case of Tranche A upon satisfaction of the Tranche A loan conditions and, in the case of Tranche B, from the date of the satisfaction of the Tranche B loan conditions. Tranche A can be drawn in one Loan only and must be drawn before 31 March 2009. Tranche B can be drawn in one or more Loans which are drawn before 1 December 2009. Amounts not drawn within the relevant periods are cancelled.
Conversion rights
Amounts drawn down under the Facility may be converted, at the discretion of each Lender, into Ordinary Shares, irrespective of whether such amounts are still outstanding or have previously been repaid or prepaid. The price for the issue of Ordinary Shares pursuant to such conversion rights shall be the Conversion Price. The Conversion Price is subject to adjustment in the event of change to the Company's share capital.
Prepayment
The Company has the right to prepay the Facility in whole or in part (in minimum payments of $1.0 million) at any time without penalty. Prepaid amounts may not be redrawn by the Company. Each Lender will have the right to re-advance prepaid amounts for the sole purpose of exercising conversion rights provided for in the Facility.
Fees
The establishment fee payable to the Lenders in respect of the Facility is $212,500, payable within three business days of the EGM in Ordinary Shares valued at the VWAP Price.
The Company must pay a commitment fee under the Facility of three per cent per annum of the undrawn amount of the Facility, payable quarterly in cash, or, at each Lender's option, in Ordinary Shares valued at the VWAP Price.
The Company may not reduce the amount of the undrawn commitment even where this is no longer required.
Participation
The Lenders have the right, at any time prior to the Expiry Date, to participate in any equity financing of the Company pro rata to their fully diluted holdings assuming conversion rights accrued at the time of such financing have been exercised in full.
Repayment
Repayment of the Facility occurs in full upon the first to occur of: (i) the Expiry Date; (ii) acceleration of the Loans by the Lenders (at the Lenders' option) following a direct or indirect sale or joint venture of more than 10% in any of the Projects without the prior approval of the Lenders; or (iii) acceleration of the Loans by the Lenders (at the Lenders' option) following an event of default.
Interest
Interest is payable on amounts outstanding at the rate of 7.5 per cent per annum. During any period when any amounts are due and payable by the Company but are unpaid, the default interest rate shall be 10.5 per cent per annum. Interest is payable quarterly until the Expiry Date (and on the Expiry Date) in cash or, at the option of each Lender with respect to their respective portions of the Facility, in Ordinary Shares valued at the VWAP Price. In the absence of an event of default, the Company may opt to pay interest in Ordinary Shares valued at the VWAP Price.
Security
The Convertible Loan Agreement is conditional on the entry by the Company and certain of its subsidiaries into guarantees and security documents whereby the Lenders take security over the shares of the Company's subsidiaries, the Company's principal bank account, and certain assets of the Company's Slovakian subsidiaries. Equivalent security (to be shared on a pari passu basis) is to be granted to YA at the same time.
Representations and warranties
The Convertible Loan Agreement contains representations and warranties by the Company and certain of its subsidiaries including warranties on: corporate organisation, group and capital structure; the absence of: the need for government approval, litigation, environmental liabilities or claims, indebtedness (other than disclosed and approved) and material adverse change; accuracy of financial statements and other information provided; unencumbered title to real property owned by the Company and certain of its subsidiaries; taxes; technical data; and compliance with laws and material agreements.
It is a condition precedent of each drawdown of the Facility that the representations and warranties remain true and accurate as at the date of drawdown. There is no guarantee that such representations or warranties will be true and accurate when required to be repeated such that the Company may be unable to drawdown the Facility.
Affirmative covenants
The Convertible Loan Agreement contains affirmative covenants given by the Company and certain of its subsidiaries including covenants regarding: legal compliance and compliance with material agreements; permitting; ongoing financial reporting and provision of information; continuity of business; maintenance of insurance; protection of mining rights; and the grant to RCF of the right to nominate one Director to the board of Directors of the Company while its conversion rights, together with any holding of Ordinary Shares, result in an interest in over five per cent of the issued Ordinary Shares (on a fully diluted basis). Where such interest exceeds 20 per cent RCF shall be entitled to nominate two Directors to the board of Directors of the Company.
Negative covenants
The Convertible Loan Agreement contains negative covenants given by the Company and certain of its subsidiaries including covenants regarding: incurring future indebtedness; creation of security interests; assuming indebtedness of others; making investments; royalty or production payments; sale of assets or mineral production; dividends; sale, transfer or issue of Ordinary Shares; and amendment of the business plan.
In addition, EMED Mining has agreed that, prior to 4 March 2010 it will not issue any Ordinary Shares or securities convertible into Ordinary Shares at a price per share less than the Conversion Price without the prior consent of the Lenders (save for certain exempt share issues and option grants).
EMED Mining and those of its subsidiaries that are party to the Convertible Loan Agreement have each undertaken that they will not, without the prior consent of the Lenders, enter into or amend any material agreement. For these purposes a material agreement is either those agreements specifically identified in the Convertible Loan Agreement or any other agreement the performance or breach of which may have a material adverse effect on EMED Mining or its subsidiaries and includes an agreement to sell or issue to any person Ordinary Shares equal to or in excess of five per cent of the Company's issued share capital.
Event of default and repayment events
The Convertible Loan Agreement contains a number of event of default provisions including: events related to a change of control (which includes any person acquiring a 20 per cent interest in the Company's share capital); non-payment; breach of representations or warranties; cross-default; insolvency, judgements made against the Company or its subsidiaries, expropriation, cessation of a Project and material adverse change.
Repayment of the Loans may be accelerated by either Lender (for its portion) on the occurrence of some events of default (including non payment) or by RCF (for its own portion and that of RMB) on the occurrence of other events of default. Repayment of all Loans is automatically accelerated on an insolvency event.
In addition, where a repayment event occurs the Company may (at the Lenders' option) be required to repay all outstanding amounts under the Facility together with accrued interest. A repayment event includes the disposal by EMED Mining or its subsidiaries of an interest in a Project of more than 10 per cent of such party's interest at the Closing Date.