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Resource Generation Limited - Funding Update

Release Date: 26/02/2016 07:05:00      Code(s): RSG     
Resource Generation Limited

Registered in Australia under the Corporations Act, 2001 (Cth) with
registration number ACN: 059 950 337
ISIN: AU000000RES1
Share Code on the ASX: RES
Share Code on the JSE: RSG
(?Resource Generation? or the ?Company?)


26 February 2016


ASX Announcement



                                               Funding Update


The Board provides this update to shareholders on the status of the Company's actions to establish funding
for the Boikarabelo Coal Mine project.

On 22 January 2016, the Company appointed Grant Samuel to advise the Board in connection with the
funding of the Boikarabelo Coal Mine project (?the project?).

Intensive discussions, including due diligence investigations, with a number of parties concerning proposed
funding solutions have taken place in the last few weeks of 2015 and during January and February of 2016.

Of the proposed solutions investigated by the Company during this period, the preferred funding solution is
the debt funding referred to in previous announcements which is being negotiated with FirstRand Bank
Limited, acting through its Rand Merchant Bank division (?RMB?), Hong Kong & Shanghai Banking
Corporation PLC (?HSBC?), Noble Group Limited, Public Investment Corporation of South Africa SOC
Limited (?PIC?), Industrial Development Corporation Limited (?IDC?) and Export Finance and Insurance
Corporation (collectively ?the debt club?). All members of the debt club have renewed their commitment to
work with the Company to finalise a commercially competitive and sustainable funding solution as soon as
possible. The strategic realignment of the project with South Africa, and the appointment of South African
representatives to the Board, has secured a high degree of goodwill from the South African prospective
lenders, HSBC, RMB, PIC and IDC, from whom the bulk of the debt funding would be sourced.

On 17 February 2016, the Company appointed RMB as lead arranger and co-lender for the financing of the
project. RMB is a leading financier in the resource sector in South Africa and enjoys an excellent reputation
for the completion of project funding packages, including a very recent R10 billion debt facility for a client
despite the prevailing difficult economic climate. The Company is confident that RMB and all members of the
debt club are committed to complete the funding process in the shortest time possible.

Other funding options

In conjunction with RMB, the Company is considering numerous providers of funding and credible solutions
will be incorporated into the debt club as required.

The Company previously made announcements on 30 September 2015 concerning a Memorandum of
Understanding (?MOU?) between the Company and HAB & JPR Priv?e (?HAB?), which was there described
as ?a Swiss private company?. Those announcements were authorised by the previous management and
Board of the Company which were replaced in the shareholder requisitioned general meeting on 26
November 2015.

Resource Generation Limited (ACN 059 950 337)             www.resgen.com.au
c/o Level 1, 17 Station Road, Indooropilly, QLD, 4068
GPO Box 126, Albion 4010 QLD. Phone +61 2 9376 9000

The newly appointed management and Board of the Company has, since those announcements, sought
clarification as to the identity of the principals of HAB, the source of funds, the track record of the ultimate
lender and the ability of HAB to provide funding as previously suggested in the 30 September 2015
announcements.

The Company has not received satisfactory responses, or even confirmation that HAB is able to provide
such funding. Accordingly, the Company has, on the advice of Grant Samuel and the legal advisers
appointed in relation to this matter, ceased communication with HAB to pursue a funding solution.

The Company and its major shareholders are all committed to the completion of the project funding as soon
as possible and will keep shareholders informed of any material developments in this regard.




Yours faithfully
For Resource Generation Ltd




Denis Gately
Chairman

JSE Sponsor: Deloitte & Touche Sponsor Services (Pty) Ltd




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Date: 26/02/2016 07:05:00 Supplied by www.sharenet.co.za                     
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