Sirius Minerals Regulatory News (SXX)

LEI: 2138004ATVA9GVUAGA82

NOT FOR DISTRIBUTION IN OR INTO THE UNITED STATES, OR IN OR INTO CANADA, AUSTRALIA, SOUTH AFRICA, JAPAN, JERSEY OR

ANY OTHER JURISDICTION IN WHICH SUCH DISTRIBUTION WOULD BE PROHIBITED BY APPLICABLE LAW

11 April 2018

Sirius Minerals PlcInvitation for incentivised conversion of convertible bonds

Sirius Minerals Plc (the "Company" or the "Offeror") today announces an invitation (the "Invitation") to holders (the "Bondholders") of the outstanding US$400,000,000 8.5% Guaranteed Convertible Bonds due 2023 (ISIN: XS151522356) (the "Bonds") issued by Sirius Minerals Finance Limited (the "Issuer") and guaranteed by the Company, to offer to exercise their Conversion Rights (as defined in the terms of the Bonds) in order to convert their Bonds into ordinary shares of the Company (the "Ordinary Shares") and a cash make whole amount.

The Bonds were issued as part of the Company's stage one financing, which completed in late 2016.

Further details of the formal invitation are set out below.

Rationale

The Bonds are presently capable of being converted and, as at the date of this announcement, are trading substantially "in‐the‐money". With this invitation, the Company is seeking to accelerate the conversion of the Bonds into Ordinary Shares, with a view to:

· reducing outstanding debt in advance of the Company's stage two financing later this year

· enabling the Company to release some of the cash which was set aside in a secured escrow account to cover interest payments on the Bonds

· reducing hedging activities in respect of the Ordinary Shares by some Bondholders

· reducing overhang on the Ordinary Shares underlying the Bonds from ongoing potential ad-hoc conversions and enabling unwinding of associated hedges.

The invitation is open until 3pm (London time) on 16 April 2018. A further announcement will be made as soon as reasonable practicable thereafter confirming the outcome of the Invitation (which is at the sole discretion of the Company).

Sirius Minerals' Finance Director and CFO, Thomas Staley, comments:

"At Sirius Minerals we are always searching for ways to improve and adapt all aspects of our business. This Invitation for conversion provides the opportunity to facilitate orderly conversion for Bondholders while enabling the Company to optimise its capital structure ahead of stage two financing later this year."

Overview of the Invitation

Bondholders who offer to exercise their Conversion Rights pursuant to the Invitation will, if such offer is accepted by the Company, be entitled to receive:

(A) a number of Ordinary Shares comprising, in respect of each U.S.$200,000 in aggregate principal amount of the Bonds accepted for conversion pursuant to the Invitation:

(i) 650,195.05852 Ordinary Shares, being a number of Ordinary Shares equal to the Bondholder's entitlement under the Conditions following exercise of Conversion Rights (the "Base Shares");

(ii) a number of additional Ordinary Shares (the "Premium to Parity Shares") as further described below; and

(ii) a number of additional Ordinary Shares (the "Incentive Shares" and, together with the Base Shares and the Premium to Parity Shares, the "Consideration Shares") as further described below; and

(B) the Make Whole Amount (as defined in the Conditions), payable in cash in U.S. dollars, to which the Bondholder is entitled under the Conditions following exercise of Conversion Rights.

The final number of Incentive Shares is to be determined pursuant to a modified Dutch auction process.

The Bonds were issued by Sirius Minerals Finance Limited, a wholly‐owned subsidiary of the Offeror, on 28 November 2016 in an aggregate principal amount of US$400,000,000. As at the date of this announcement, the Bonds are trading "in-the‐money" and US$308,000,000 in aggregate principal amount of the Bonds remains outstanding. The current exchange price is US$0.3076 per Ordinary Share and the fixed exchange rate for these purposes is £1.00 = US$1.2304 (fixed as at 3 November 2016).

Invitation Terms

On the terms and subject to the conditions and invitation restrictions set out in the Invitation Term Sheet dated 11 April 2018, the Offeror invites holders, subject to offer restrictions, to submit an invitation conversion notice (each, an "Invitation Conversion Notice") specifying an incentive amount between US$2,000 ‐ US$10,000 per US$200,000 in principal amount of the Bonds (the "Offer Consideration"). This Offer Consideration range represents a potential 4,662.10247 ‐ 23,310.51234 Incentive Shares per US$200,000 principal amount of the Bonds converted, at a fixed reference price of US$0.4290 per share. The Premium to Parity Shares represent the premium of the market price of the Bonds versus the value of the Base Shares over the period of 10 business days up to and including the Launch Date.

After the Expiration Date (as defined below), the Offeror will, in its sole and absolute discretion, determine the final Offer Consideration within the Offer Consideration range (the "Final Offer Consideration"). Subject to applicable law, the Offeror intends to accept for conversion pursuant to the Conditions and the Invitation any and all Bonds offered for conversion at or below the Final Offer Consideration. The final aggregate principal amount of Bonds accepted for conversion pursuant to the Invitation, the Final Offer Consideration and number of Incentive Shares to be delivered per US$200,000 in principal amount of the Bonds being offered for conversion will be announced by the Offeror as soon as reasonably practicable after the Expiration Deadline.

A Bondholder whose offer to convert its Bonds is accepted pursuant to the Invitation will receive the Consideration Shares and the cash Make Whole Amount on or around the Settlement Date.

Bondholders should be aware that, pursuant to the Terms and Conditions of the Bonds, the Issuer retains the right to redeem the Bonds at their principal amount (plus accrued interest) at any time if 85 per cent. or more of the aggregate principal amount of Bonds originally issued shall have been previously converted or repurchased and cancelled.

To participate in the Invitation, eligible holders must submit, or instruct a relevant intermediary to submit on their behalf, their valid Invitation Conversion Notice specifying the Offer Consideration and the principal amount of the Bonds offered for conversion by way of a SWIFT instruction via Euroclear Bank SA/NV and Clearstream Banking S.A. (the "ICSDs") to The Bank of New York Mellon, London Branch (the "Agent") before the Expiration Deadline in accordance with the Invitation Term Sheet and the Invitation Conversion Notice. A Bondholder may submit one or more Non-Competitive Offers and/or Competitive Offers in respect its holding of Bonds, provided that the aggregate principal amount of the Bonds that are the subject of such offers does not exceed the aggregate principal amount of the Bonds held by such Bondholder.

Expected Timetable for the Invitation

This timetable is indicative only and subject to change in the sole discretion of the Company.

Further Information regarding the Invitation

The Offeror may, in its discretion, extend, re‐open, amend, waive any condition of, or terminate the Invitation at any time prior to the Announcement of Results, subject to applicable law.

All Invitation Conversion Notices delivered to the Agent will be irrevocable, except (i) if the relevant Bonds are not accepted for conversion pursuant to the Invitation and (ii) in the limited circumstances described in the Invitation Term Sheet. Invitation Conversion Notices which are not accepted by the Company pursuant to the Invitation will be void and of no effect, and the relevant Bondholder will not be treated as having exercised its Conversion Rights.

Holders are advised to read the Invitation Term Sheet in its entirety prior to deciding on whether to participate in the Invitation.

Deutsche Bank AG, London Branch is acting as sole Dealer Manager in relation to the Invitation.

Any enquiries relating to the terms of the Invitation should be directed to:

Deutsche Bank AG, London BranchJonathan MurrayTel: 020 7547 3160 / Email: jonathan.murray@db.com

INSIDE INFORMATION NOTICE

This announcement is released by Sirius Minerals Plc and contains information that qualified or may have qualified as inside information for the purposes of Article 7 of the Market Abuse Regulation (EU) 596/2014 ("MAR"). For the purposes of MAR and Article 2 of Commission Implementing Regulation (EU) 2016/1055, this announcement is made by Nick King, General Counsel and Company Secretary of Sirius Minerals Plc.

Sirius Minerals Plc

For further information, please contact:

About Sirius Minerals Plc

Sirius Minerals Plc is focused on the development of the Woodsmith Mine, which will access the world's largest and highest grade polyhalite deposit located in North Yorkshire, United Kingdom. Polyhalite is a unique multi-nutrient fertilizer, which can be used to increase balanced fertilization around the world. Sirius Minerals' shares are traded on the Premium List of the London Stock Exchange. Its shares are also traded in the United States on the OTCQX through a sponsored ADR facility. Further information on the Company can be found at: www.siriusminerals.com.

IMPORTANT NOTICE

THIS PRESS RELEASE DOES NOT CONSTITUTE AN INVITATION TO PARTICIPATE IN THE INVITATION IN ANY JURISDICTION IN WHICH, OR TO OR FROM ANY PERSON TO OR FROM WHOM, IT IS UNLAWFUL TO MAKE SUCH INVITATION UNDER APPLICABLE SECURITIES LAWS. THE DISTRIBUTION OF THIS PRESS RELEASE IN CERTAIN JURISDICTIONS MAY BE RESTRICTED BY LAW. PERSONS INTO WHOSE POSSESSION THIS PRESS RELEASE COMES ARE REQUIRED BY EACH OF THE OFFEROR, THE ISSUER, THE DEALER MANAGER AND THE AGENT TO INFORM THEMSELVES ABOUT, AND TO OBSERVE, ANY SUCH RESTRICTIONS.

THIS PRESS RELEASE IS DIRECTED EXCLUSIVELY TO MARKET PROFESSIONALS AND INSTITUTIONAL INVESTORS AND IS FOR INFORMATION PURPOSES ONLY AND IS NOT TO BE RELIED UPON IN SUBSTITUTION FOR THE EXERCISE OF INDEPENDENT JUDGEMENT. IT IS NOT INTENDED AS INVESTMENT ADVICE AND UNDER NO CIRCUMSTANCES IS IT TO BE USED OR CONSIDERED AS AN OFFER TO BUY ANY BOND OR SUBSCRIBE FOR ANY SHARES NOR IS IT A RECOMMENDATION TO BUY, CONVERT, EXCHANGE OR SELL ANY BOND OR SUBSCRIBE FOR ANY SHARES.

ANY DECISION RELATING TO THE BONDS PURSUANT TO THE INVITATION SHOULD ONLY BE MADE ON THE BASIS OF AN INDEPENDENT REVIEW BY YOU OF THE OFFEROR'S AND THE ISSUER'S PUBLICLY AVAILABLE INFORMATION. NONE OF THE DEALER MANAGER, THE AGENT NOR ANY OF THEIR RESPECTIVE AFFILIATES ACCEPT ANY LIABILITY ARISING FROM THE USE OF, OR MAKES ANY REPRESENTATION AS TO THE ACCURACY OR COMPLETENESS OF, THIS PRESS RELEASE OR THE OFFEROR'S OR ISSUER'S PUBLICLY AVAILABLE INFORMATION.

THE INVITATION IS AN INVITATION TO TREAT. NEITHER THE COMPANY NOR THE DEALER MANAGER MAKES ANY RECOMMENDATION OR EXPRESSES ANY VIEW WHATSOEVER ON THE MERITS OF THE INVITATION TO ANY PERSON. BONDHOLDERS ARE SOLELY RESPONSIBLE FOR THEIR DECISION WHETHER OR NOT TO PARTICIPATE IN THE INVITATION AND MUST CONSULT THEIR OWN LEGAL, TAX, ACCOUNTING, FINANCIAL AND OTHER ADVISERS AS THEY CONSIDER APPROPRIATE.

THE DEALER MANAGER AND THE AGENT ARE ACTING ON BEHALF OF THE OFFEROR AND NO ONE ELSE IN CONNECTION WITH THE INVITATION AND WILL NOT BE RESPONSIBLE TO ANY OTHER PERSON FOR PROVIDING THE PROTECTIONS AFFORDED TO CLIENTS OF THE DEALER MANAGER OR THE AGENT, OR FOR PROVIDING ADVICE IN RELATION TO THE INVITATION. NEITHER THE DEALER MANAGER NOR THE AGENT OWES ANY DUTY TO ANY HOLDER OF THE BONDS.

THIS PRESS RELEASE DOES NOT CONSTITUTE AN OFFER TO SELL OR BUY OR A SOLICITATION OF AN OFFER TO SELL OR BUY THE BONDS OR ANY SHARES, AS APPLICABLE (AND OFFERS OF BONDS FOR CONVERSION PURSUANT TO THE INVITATION WILL NOT BE ACCEPTED FROM BONDHOLDERS IN ANY CIRCUMSTANCES IN WHICH SUCH OFFER OR SOLICITATION IS UNLAWFUL). IN THOSE JURISDICTIONS WHERE THE SECURITIES, BLUE SKY OR OTHER LAWS REQUIRE THE INVITATION TO BE MADE BY A LICENSED BROKER OR DEALER AND THE DEALER MANAGER OR ITS AFFILIATES IS SUCH A LICENSED BROKER OR DEALER IN SUCH JURISDICTIONS, THE INVITATION SHALL BE DEEMED TO BE MADE BY THE DEALER MANAGER OR SUCH AFFILIATE (AS THE CASE MAY BE) ON BEHALF OF THE OFFEROR IN SUCH JURISDICTIONS.

MIFID PRODUCT GOVERNANCE - SOLELY FOR THE PURPOSES OF THE MANUFACTURER'S PRODUCT GOVERNANCE REQUIREMENTS, THE TARGET MARKET IS ASSESSED TO BE RETAIL INVESTORS, ELIGIBLE COUNTERPARTIES AND PROFESSIONAL CLIENTS, ALL DISTRIBUTION CHANNELS.

UNITED STATES

THE INVITATION IS NOT BEING MADE AND WILL NOT BE MADE DIRECTLY OR INDIRECTLY IN OR INTO, OR BY USE OF THE MAILS OF, OR BY ANY MEANS OR INSTRUMENTALITY OF INTERSTATE OR FOREIGN COMMERCE OF, OR ANY FACILITIES OF A NATIONAL SECURITIES EXCHANGE OF, THE UNITED STATES OR TO U.S. PERSONS AS DEFINED IN REGULATION S OF THE U.S. SECURITIES ACT OF 1933. THIS INCLUDES, BUT IS NOT LIMITED TO, FACSIMILE TRANSMISSION, ELECTRONIC MAIL, TELEX, TELEPHONE AND THE INTERNET. ACCORDINGLY, COPIES OF THIS PRESS RELEASE AND ANY OTHER DOCUMENTS OR MATERIALS RELATING TO THE INVITATION ARE NOT BEING, AND MUST NOT BE, DIRECTLY OR INDIRECTLY MAILED OR OTHERWISE TRANSMITTED, DISTRIBUTED OR FORWARDED IN OR INTO THE UNITED STATES OR TO ANY PERSONS LOCATED OR RESIDENT IN THE UNITED STATES OR TO U.S. PERSONS AND BONDS CANNOT BE OFFERED FOR CONVERSION PURSUANT TO THE INVITATION BY ANY SUCH USE, MEANS, INSTRUMENTS OR FACILITIES OR FROM WITHIN THE UNITED STATES OR BY PERSONS LOCATED OR RESIDENT IN THE UNITED STATES, AS DEFINED IN REGULATION S OF THE SECURITIES ACT, OR BY U.S. PERSONS. FAILURE TO COMPLY WITH THESE RESTRICTIONS MAY RESULT IN A VIOLATION OF APPLICABLE LAWS AND ANY PURPORTED OFFER OF BONDS FOR CONVERSION RESULTING DIRECTLY OR INDIRECTLY FROM A VIOLATION OF THESE RESTRICTIONS WILL BE INVALID AND OFFERS OF BONDS FOR CONVERSION MADE BY A PERSON LOCATED IN THE UNITED STATES, BY A U.S. PERSON OR BY ANY AGENT, FIDUCIARY OR OTHER INTERMEDIARY ACTING FOR A NOMINEE GIVING INSTRUCTIONS FROM WITHIN THE UNITED STATES OR ON BEHALF OF A U.S. PERSON WILL NOT BE ACCEPTED.

THIS PRESS RELEASE IS NOT AN OFFER OF SECURITIES FOR SALE OR AN INVITATION TO OFFER OR SELL SECURITIES IN THE UNITED STATES OR TO U.S. PERSONS. SECURITIES MAY NOT BE OFFERED OR SOLD IN THE UNITED STATES OR TO U.S. PERSONS ABSENT REGISTRATION OR AN EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT. THE PURPOSE OF THIS PRESS RELEASE IS LIMITED TO THE INVITATION AND THIS PRESS RELEASE MAY NOT BE SENT OR GIVEN TO A PERSON IN THE UNITED STATES OR TO U.S. PERSONS. EACH HOLDER OF BONDS PARTICIPATING IN THE INVITATION WILL BE REQUIRED TO REPRESENT THAT IT IS NOT A U.S. PERSON AND IS NOT LOCATED IN THE UNITED STATES AND IS NOT PARTICIPATING IN THE INVITATION FROM THE UNITED STATES, OR IT IS ACTING ON A NON-DISCRETIONARY BASIS FOR A PRINCIPAL LOCATED OUTSIDE THE UNITED STATES THAT IS NOT GIVING AN ORDER TO PARTICIPATE IN THE INVITATION FROM THE UNITED STATES OR FOR ON BEHALF OF A U.S. PERSON.

FOR THE PURPOSES OF THIS AND THE ABOVE TWO PARAGRAPHS, "UNITED STATES" MEANS THE UNITED STATES OF AMERICA, ITS TERRITORIES AND POSSESSIONS, ANY STATE OF THE UNITED STATES OF AMERICA AND THE DISTRICT OF COLUMBIA.

EUROPEAN ECONOMIC AREA ("EEA")

THE INVITATION IS ONLY ADDRESSED TO HOLDERS OF BONDS LOCATED IN THE EEA WHO ARE "QUALIFIED INVESTORS" AS DEFINED IN DIRECTIVE 2003/71/EC (AS AMENDED, THE "PROSPECTUS DIRECTIVE"). NEITHER THIS ANNOUNCEMENT NOR ANY OTHER DOCUMENT OR MATERIAL RELATING TO THE INVITATION HAS BEEN OR SHALL BE DISTRIBUTED TO PERSONS WHO ARE NOT "QUALIFIED INVESTORS" FOR THESE PURPOSES.

UNITED KINGDOM

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FRANCE

THE INVITATION IS NOT BEING MADE, DIRECTLY OR INDIRECTLY, TO THE PUBLIC IN THE REPUBLIC OF FRANCE ("FRANCE"). NEITHER THIS PRESS RELEASE NOR ANY OTHER DOCUMENT OR MATERIAL RELATING TO THE INVITATION HAS BEEN OR SHALL BE DISTRIBUTED TO THE PUBLIC IN FRANCE AND ONLY: (I) PROVIDERS OF INVESTMENT SERVICES RELATING TO PORTFOLIO MANAGEMENT FOR THE ACCOUNT OF THIRD PARTIES (PERSONNES FOURNISSANT LE SERVICE D'INVESTISSEMENT DE GESTION DE PORTEFEUILLE POUR COMPTE DE TIERS); AND/OR (II) QUALIFIED INVESTORS (INVESTISSEURS QUALIFIÉS), ACTING FOR THEIR OWN ACCOUNT, ALL AS DEFINED IN, AND IN ACCORDANCE WITH, ARTICLES L.411-1, L.411-2 AND D.411-1 OF THE FRENCH CODE MONÉTAIRE ET FINANCIER ARE ELIGIBLE TO PARTICIPATE IN THE INVITATION. THIS PRESS RELEASE HAS NOT BEEN SUBMITTED FOR CLEARANCE TO THE AUTORITÉ DES MARCHÉS FINANCIERS.

ITALY

NONE OF THE INVITATION, THIS PRESS RELEASE OR ANY OTHER DOCUMENTS OR MATERIALS RELATING TO THE INVITATION HAVE BEEN SUBMITTED TO THE CLEARANCE PROCEDURES OF THE COMMISSIONE NAZIONALE PER LE SOCIETA E LA BORSA (CONSOB) PURSUANT TO ITALIAN LAWS AND REGULATIONS. THE INVITATION IS BEING CARRIED OUT IN THE REPUBLIC OF ITALY ("ITALY") AS AN EXEMPTED OFFER PURSUANT TO ARTICLE 101-BIS, PARAGRAPH 3-BIS OF THE LEGISLATIVE DECREE NO. 58 OF 24 FEBRUARY 1998, AS AMENDED (THE FINANCIAL SERVICES ACT) AND ARTICLE 35-BIS, PARAGRAPH 3 OF CONSOB REGULATION NO. 11971 OF 14 MAY 1999, AS AMENDED (THE "ISSUERS' REGULATION").

ACCORDINGLY, THE INVITATION IS ONLY ADDRESSED TO HOLDERS OF BONDS LOCATED IN THE REPUBLIC OF ITALY WHO ARE "QUALIFIED INVESTORS" (INVESTITORI QUALIFICATI) AS DEFINED PURSUANT TO AND WITHIN THE MEANING OF ARTICLE 100 OF THE FINANCIAL SERVICES ACT AND ARTICLE 34-TER, PARAGRAPH 1, LETTER B) OF THE ISSUERS' REGULATION.

HOLDERS OR BENEFICIAL OWNERS OF THE BONDS MAY OFFER THEIR BONDS FOR CONVERSION PURSUANT TO THE INVITATION THROUGH AUTHORISED PERSONS (SUCH AS INVESTMENT FIRMS, BANKS OR FINANCIAL INTERMEDIARIES PERMITTED TO CONDUCT SUCH ACTIVITIES IN ITALY IN ACCORDANCE WITH THE FINANCIAL SERVICES ACT, CONSOB REGULATION NO. 16190 OF 29 OCTOBER 2007, AS AMENDED FROM TIME TO TIME, AND LEGISLATIVE DECREE NO. 385 OF SEPTEMBER 1, 1993, AS AMENDED) AND IN COMPLIANCE WITH APPLICABLE LAWS AND REGULATIONS OR WITH REQUIREMENTS IMPOSED BY CONSOB OR ANY OTHER ITALIAN AUTHORITY. EACH INTERMEDIARY MUST COMPLY WITH THE APPLICABLE LAWS AND REGULATIONS CONCERNING INFORMATION DUTIES VIS-À-VIS ITS CLIENTS IN CONNECTION WITH THE BONDS OR THE INVITATION.

STATES OF JERSEY

THE INVITATION IS NOT BEING MADE, DIRECTLY OR INDIRECTLY, IN OR INTO, JERSEY. NEITHER THIS ANNOUNCEMENT NOR ANY OTHER DOCUMENT OR MATERIAL RELATING TO THE INVITATION HAS BEEN OR SHALL BE DISTRIBUTED IN JERSEY.