Savannah Resources Regulatory News (SAV)

Savannah Resources Plc / Index: AIM / Epic: SAV / Sector: Mining

10 April 2014

Savannah Resources Plc

Savannah secures up to US$6.3 million investment to fund Oman copper purchase and growth

Highlights:

• Investment of up to US$6.3 million by way of a private placement agreement and an issuance of an unsecured convertible

• Funds acquisition of Oman copper projects, the associated exploration investment and growth (as announced on 10 April 2014)

• The US$6.3 million facility augments Savannah's existing strong balance sheet comprising current assets of approximately £4m and nil debt

• Funding provided by New York based fund, Bergen Global Opportunity Fund, LP, an institutional investor

Savannah Resources Plc (AIM: SAV) announces that it has entered into an agreement to place up to US$5,900,000 worth of new ordinary shares in Savannah and to issue a US$400,000 unsecured convertible instrument to Bergen Global Opportunity Fund, LP, an institutional investment fund managed by Bergen Asset Management, LLC, a New York asset management firm.

Savannah's Chief Executive Officer, David Archer, said "The deal not only underwrites the proposed acquisition announced today of Gentor Resources Inc's Oman copper project portfolio and the associated mid-term exploration investment but will also support further initiatives in our core geographies of Mozambique and Oman in our core commodities of heavy mineral sands and copper.

"The US$6.3m facility means that Savannah is exceptionally well placed being fully funded and having an already solid existing balance sheet, existing current assets of approximately £4.0m, an expanding portfolio of resources investments and strong news flows.

"We are delighted to welcome Bergen as an institutional investor to our share register."

Investment Details

Savannah Resources Plc has entered into a share purchase and convertible securities deed (the "Deed") with Bergen Global Opportunity Fund, LP ("Bergen"), in connection with a private placement of up to US$5,900,000 worth of new ordinary shares in Savannah (the "Shares") and an issuance of a US$400,000 unsecured convertible instrument.

The Shares will (subject to the satisfaction of certain conditions) be issued in 12 approximately monthly tranches and Savannah will make an announcement upon the issue of each tranche of Shares (each, a "Tranche"). The initial Tranche will be in respect of US$400,000 worth of Shares. Each of the 11 remaining Tranches will be in respect of US$400,000 (subject to certain adjustments) worth of Shares, although Savannah and Bergen may agree to increase any Tranche to up to US$500,000.

Savannah will make an announcement each time a Tranche is issued and will specify in such announcement the number of Shares subscribed for by Bergen and the subscription price. The number of Shares to be subscribed for by Bergen will be calculated (at Bergen's election) by reference to (a) 91% of the average of five daily volume-weighted average prices of the Shares on AIM during a specified period preceding the issuance of the Tranche and (b) 135% of the average of the daily volume-weighted average prices of the Shares for the 20 consecutive trading days preceding 10 April 2014, save that (b) may only apply in relation to two Tranches only.

Savannah will additionally have the right to terminate the Deed at any time and not to issue the remaining Tranches on payment of a modest termination fee. Bergen has agreed to certain limitations on its ability to dispose of the Shares following any purchase.

Application will be made to the London Stock Exchange for any Shares issued and allotted pursuant to the Deed to be admitted to trading on AIM.

In connection with the Deed:

(a) Savannah has paid Bergen a commencement fee of US$157,500 by way of the issue of 1,667,064 Shares ("Commencement Shares"). Savannah has applied for admission of these Shares to trading on AIM, and this is expected to become effective on or about 17 April 2014;

(b) Savannah has issued 1,250,000 Shares at par to Bergen ("Collateral Shares"). Savannah has applied for admission of these Shares to trading on AIM, and this is expected to become effective on or about 17 April 2014. Bergen may be required to make a further payment to Savannah once all of the obligations of Savannah under the Deed have been finally met and no amount remains outstanding to Bergen, depending on the price of Shares at such time;

(c) Savannah has agreed that it will (subject to the satisfaction of certain conditions) issue 2,800,000 warrants with an exercise period of 36 months from the date of issue (the "Warrants") to Bergen entitling Bergen (or any subsequent holder of the Warrants) to subscribe for one Share per Warrant at an exercise price equal to 135% of the average of the daily volume-weighted average price of the Shares during the 20 trading days prior to 9 April 2014; and

(d) Savannah will issue to Bergen an unsecured convertible instrument (having a nominal value of US$400,000, which will be convertible into Shares (the "Convertible Security"). Savannah will make an announcement each time the Convertible Security is converted in whole or in part and will specify in such announcement the relevant conversion price, which will be the lesser of (a) 91% of the average of five daily volume-weighted average prices of the Shares on AIM during a specified period preceding the date of the conversion of the Convertible Security and (b) 135% of the average of the daily volume-weighted average prices of the Shares for the 20 consecutive trading days preceding 10 April 2014.

The Convertible Security and the Shares in the Tranches will only be issued to the extent that Savannah has shareholder authority to do so.

Application will be made to the London Stock Exchange for any Shares issued and allotted on exercise of the Warrants or conversion of the Convertible Security to be admitted to trading on AIM.

The cash proceeds from the issue of the Shares and the Convertible Security will be used by Savannah to assist the acquisition of Gentor Resources Limited, and the funding of Gentor's exploration and development programmes in Oman, potential new resources investments and general working capital.

Following admission of the 2,917,064 Shares relating to both the Collateral Shares and Commencement Shares, Savannah will have 161,365,359 Shares in issue with each Share carrying the right to one vote. There are no Shares currently held in treasury. The total number of voting rights in Savannah is therefore 161,365,359 and this figure may be used by shareholders as the denominator for the calculations by which they determine if they are required to notify their interest in, or a change to their interest in, Savannah under the Disclosure and Transparency Rules.

About Bergen Asset Management LLC

Bergen Global Opportunity Fund, LP is managed by Bergen Asset Management LLC, a New York-based asset management company. Bergen Asset Management LLC invests in high-growth public and private companies in a range of industries around the world and has an extensive track record of successful investments in dozens of small-cap public companies over the years. Among Bergen's dozens of investments, its recent investments included a one-off $2.7 mil receivables financing provided to WHL Energy Ltd (ASX:WHN) which bridged that company to an entry into a substantial transaction with Ophir Energy Plc; an M&A bridge provided to Krucible Metals Ltd (ASX:KRB) which was instrumental in a $12 mil cash sale of its phosphate asset to a third party acquirer; an A$7.6 mil 12-month facility similar to the facility entered into with Savannah, with SUDA Ltd (ASX:SUD) during the course of which SUDA's share price approximately tripled, and a £1.53 mil funding recently provided to TXO Plc (AIM:TXO).

**ENDS**

For further information please visit www.savannahresources.com or contact:

Notes

About Savannah

Savannah Resources Plc (AIM: SAV) is a multi-commodity focussed exploration and development company. Through its 80% ownership of Matilda Minerals Limitada it operates the Jangamo exploration project in a world class mineral sands province in Mozambique which borders Rio Tinto's Mutamba deposit, one of two major deposits Rio Tinto has defined in Mozambique, which collectively have an exploration target of 7-12Bn tonnes at 3-4.5% THM (published in 2008). Savannah is acquiring the Oman copper project portfolio of Gentor Resources Inc. which includes a 65% interest in the Block 5 copper project which contains an Indicated and Inferred Mineral Resource of 1.7Mt at 2.2% copper. In addition, Savannah owns an effective 20.9% strategic shareholding in Alecto Minerals Plc (www.alectominerals.com) which provides Savannah with exposure to both the highly prospective Kossanto Gold Project in the prolific Kenieba inlier in Mali, the wholly owned Wad Amour IOCG Project in Mauritania and to the Wayu Boda and Aysid Meketel gold / base metal projects in Ethiopia for which Alecto has a joint venture with Centamin Plc. Under this joint venture, Centamin Plc is committing up to US$14m in exploration funding to earn up to 70% of each project. Savannah is also evaluating additional opportunities to expand its portfolio and geographical focus.