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EXXARO RESOURCES LIMITED - Additional details and amendments to Exxaros Financial Assistance to black economic empowerment shareholder

Release Date: 23/10/2015 12:09:00      Code(s): EXX     
(Incorporated in the Republic of South Africa)
Registration Number: 2000/011076/06
JSE share code: EXX
ISIN: ZAE000084992
(?Exxaro? or ?the company?)
23 October 2015


Shareholders are referred to the SENS announcement published by the company on 24 July
2015 regarding the provision of financial assistance to the company?s Black Economic
Empowerment (?BEE?) shareholder consortium, Main Street 333 Proprietary Limited
(?MS333?), which holds a 52,09 per cent interest in the company.

In the above-mentioned announcement, it was communicated that MS333 had been
provided with an interim loan to the value of R400 million by the company (?the Exxaro
Loan?) to repay a portion of a Preference Share Facility (?Preference Share Facility?) it raised
with a consortium of banks (?the Funders?), to refinance the acquisition debt it had raised in
2006 for the initial acquisition of a controlling interest in Exxaro. The Preference Share
Facility is secured by MS333?s shareholding in Exxaro.

Further to the above announcement, additional funding for the Preference Share Facility has
now been secured, which will provide for a longer term solution to Exxaro?s BEE status. In
terms of an agreement between Exxaro, MS333, the Funders and the Industrial
Development Corporation (?IDC?), the IDC will provide a guarantee to the Funders to the
value of R700 million on commercial terms (?IDC guarantee?). A portion of the Preference
Share Facility will now be converted into a subordinated loan against the security of the IDC
guarantee. However, a condition of the IDC guarantee is that the original terms of the Exxaro
Loan be amended such that the settlement thereof only occurs subsequent to the settlement
of the Preference Share Facility and the IDC guarantee, being March 2017 and April 2017
respectively. As the introduction of the IDC guarantee, as well as the Exxaro Loan will
provide a substantial buffer against any further default of the Preference Share Facility, the
Funders have also agreed to reset the share cover default levels of the Preference Share
Facility to a 3 times cover level.

Exxaro maintains the view that it is in the best interests of the company and its shareholders
to provide the Exxaro Loan and IDC guarantee to MS333 to ensure continued majority black
ownership and control of Exxaro up until the end of 2016 when MS333 is free to dispose of
its shareholding in Exxaro.

The terms of the Exxaro loan will be as follows:

*   Amount:           R400 million
*   Interest rate:    Prime + 5% pa
*   Maturity date:    April 2017
*   Ranking:          Subordinated to the Preference Share Facility and IDC guarantee
*   Security:         Reversionary cession over Exxaro shares held by MS333
*   Interest and capital repayments: subject to Exxaro declaring dividends and in line with
    the ranking of the Exxaro loan

The terms referred to in this announcement are subject to the conclusion of the requisite
legal agreements between Exxaro, MS333, the IDC and the Funders and the legal
agreements becoming unconditional in all respects.

Editor?s Note:

Exxaro is one of the largest South African-based diversified resources companies, with
interests in the coal, titanium dioxide, iron ore and energy commodities. www.exxaro.com


Wim de Klerk

Finance Director

Tel: +27 12 307 4848

Mobile: +27 82 652 5142

Email: wim.deklerk@exxaro.com


Absa Bank Limited (acting through its Corporate and Investment Banking Division)

Date: 23/10/2015 12:09:00 Supplied by www.sharenet.co.za                     
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