29 Dec 2008 11:00
29 December 2008 AIM: GMA
GMA Resources Plc
Proposed variation of loan stock and placing of new ordinary shares and convertible loan stock to raise £1.39 million
GMA Resources Plc ("GMA" or "the Company") announces that, pursuant to a placing agreement entered into today with Mirabaud Securities Limited, it has conditionally raised £1.39 million, before expenses, by way of a placing of 10,526,000 new ordinary shares of £0.01 each ("Placing Shares") at approximately 1.9 pence per share and £1,190,000 nominal of fixed rate unsecured convertible loan stock 2011 ("Loan Stock 2011") (the "Placing").
The Company also announces that it has been in discussions with a number of the holders of 10% unsecured convertible loan stock 2009 ("Loan Stock 2009") to vary the terms of the Loan Stock 2009. The key changes that are proposed to be made to the Loan Stock 2009 are to defer the maturity date to 31 December 2010 and to reduce the price at which the Loan Stock 2009 converts into ordinary shares of £0.01 each in the Company ("Ordinary Shares") from 15 pence to 5 pence per share. The amendments to the terms of the Loan Stock 2009 require the approval of all of those holders of such loan stock who vote in person or by proxy at a class meeting convened for 10.00 a.m. on 22 January 2009 (the "Class Meeting").
The Placing Shares, which have been conditionally placed with an existing shareholder, will represent approximately 2.86 per cent of the enlarged issued share capital of the Company.
The Company has constituted the Loan Stock 2011 pursuant to an instrument by way of deed poll executed as of today's date. An aggregate of £1,190,000 nominal of Loan Stock 2011 has been conditionally placed with investors pursuant to the Placing. Until the Loan Stock 2011 has been repaid or converted the Company is required to pay holders of Loan Stock 2011 interest on 30 June and 31 December each year in respect of the previous six month period. Interest is calculated at a rate of 15 per cent. per annum on the principal amount of the Loan Stock 2011 then in issue. The maturity date of the Loan Stock 2011 is 31 December 2011, on which date the Company is required to redeem the principal amount of the Loan Stock 2011 together with all accrued interest up to the date of redemption. Holders of Loan Stock 2011 will have the right at any time to convert their Loan Stock 2011 into new Ordinary Shares at an effective conversion price of 2.25 pence per Ordinary Share. The Company will have the right from 23 January 2010 to require conversion of the Loan Stock 2011 into ordinary shares where the price of the Ordinary Shares on AIM is above four pence per share for 30 consecutive business days.
The proceeds of the Placing will be used for general working capital purposes.
The Placing is conditional, inter alia, on the passing of all of the resolutions to be proposed at the Class Meeting and at an extraordinary general meeting ("EGM") of the Company to be held at 10.15 a.m. on 22 January 2009 (or, if later, immediately following the Class Meeting) and the Placing Shares being admitted to trading on AIM, which is expected to occur on or around 23 January 2009. Following the Placing, the Company will have total of 378,588,493 Ordinary Shares in issue.
A circular has been posted to shareholders and holders of Loan Stock 2009 today which contains further details of the Placing and the proposed variation of the terms of the Loan Stock 2009. The circular also contains notices convening the Class Meeting and the EGM which will be held at the offices of Sprecher Grier Halberstam LLP, 5th Floor, One America Square, Crosswall London EC3N 2SG. Copies of the circular will be available free of charge during normal business hours on weekdays (excluding Saturday, Sunday and public holidays) from the date hereof until 29 January 2009 from the Company's registered office or the offices of Capita Registrars, The Registry, 34 Beckenham Road, Beckenham, Kent BR3 4TU. The circular will also be available from the Company's website at www.gmaresources.co.uk.
Douglas Perkins, CEO of GMA, commented:
"We are pleased to have been able to raise this money which has provided the Company with vital working capital for the immediate term. We will deploy these funds carefully as we build up production to feasibility study levels over the next few months."
Enquiries:
| GMA Resources Plc | Douglas Perkins | +1 514 806 6788 |
| John East & Partners Limited (Nomad) | Bidhi Bhoma | +44 (0) 20 7628 2200 |
| Mirabaud Securities Limited (Broker) | Rory Scott | +44 (0) 20 7878 3360 |
Notes to Editors:
GMA owns a controlling 52% stake in ENOR spa ("ENOR"), the Algerian based operating company for the Tirek-Amesmessa project, with the remainder owned by Sonatrach, the Algerian state-owned oil and gas company.
ENOR holds the exploitation authorisation to the Tirek-Amesmessa property, an area of some 1,417 km2, located approximately 450km south west of the city, Tamanrasset, in southern Algeria. Amesmessa is an open pit heap leach gold mine located in the extreme south of the permit area. The Tirek gold mine is located centrally in the northern third of the exploration permit area, some 60 km north of Amesmessa. Research to date suggests that the Zita Zone, which lies between Tirek and Amesmessa, offers considerable potential for the development of additional prospects amenable to open-pit mining. GMA plans to quickly expand upon resources outside of the major 80km Tirek-Amesmessa fault north/south of the concession.
GMA's shares are traded on the AIM market of the London Stock Exchange (AIM: GMA).
For further information on the Company, please visit: www.gmaresources.co.uk