BRIMSTONE INVESTMENT CORPORATION LD - Announcement regarding the grant of an option to Oceana Group Limited to acquire shares held indirectly by Brimstone

Announcement regarding the grant of an option to Oceana Group Limited to acquire shares held indirectly by Brimstone

Brimstone Investment Corporation Limited
(Incorporated in the Republic of South Africa)
Registration number 1995/010442/06
Share Code: BRT ISIN: ZAE000015277
Share Code: BRN ISIN: ZAE000015285
("Brimstone" or the “Company”)

ANNOUNCEMENT REGARDING THE GRANT OF AN OPTION TO OCEANA GROUP LIMITED
(“OCEANA”) TO ACQUIRE SHARES IN OCEANA HELD INDIRECTLY BY BRIMSTONE

1.    Introduction

      Shareholders are referred to an announcement published by the Company on 21 December
      2011, regarding the acquisition by Brimstone of a further 8.5 million shares in Oceana (“the
      Oceana Shares”). The Oceana Shares were acquired on the market and settled in cash through
      Brimstone accessing its long-term funding facilities. Shareholders are also referred to an
      announcement published by Oceana on SENS on 7 November 2012.

      Effective during October 2012, Newshelf 1064 (RF) Proprietary Limited (“Newshelf”) (a wholly-
      owned subsidiary of Brimstone and the company through which the Oceana Shares are held)
      entered into an agreement (“the Subscription Agreement”) with The Standard of South Africa
      Limited (“SBSA”) to refinance its holding of the Oceana Shares (“the Newshelf Refinancing”).
      The Newshelf Refinancing is subject to customary share cover covenants in favour of SBSA and
      gives Oceana the right to exercise a call option over the Oceana Shares under certain limited
      circumstances.

      As a result hereof, shareholders are advised that Brimstone and Newshelf have entered into an
      agreement with Oceana (“the Call Option Agreement”) in terms whereof Newshelf irrevocably
      grants to Oceana (and/or any of its subsidiaries) the option, in the event of certain share cover
      ratios being triggered, to repurchase or purchase from Newshelf, upon written notice by Oceana
      to Newshelf, the Oceana Shares at their then current market value per share (being the then
      current daily volume weighted average price traded on the JSE Limited (“the JSE”)) (“the Call
      Option”) at the time of the exercise of the Call Option and upon the terms and conditions set out
      in paragraph 2 below.

2.    Terms and conditions of the Call Option

      The Call Option Agreement is subject to the fulfilment of the suspensive condition that the
      Subscription Agreement has been signed by all its parties thereto and has become
      unconditional in accordance with its terms.

      Oceana's right and entitlement to exercise the Call Option in terms of the Call Option Agreement
      shall only come into effect once the shareholders of Oceana (by special resolution and in terms
      of the applicable Listings Requirements of the JSE) have approved the entry into of the Call
      Option Agreement by Oceana. If approved, and upon certain share cover ratios being triggered,
      the Call Option must be exercised by Oceana within two business days of written notification
      from SBSA (“the SBSA Notice"). The purchase consideration payable by Oceana (or any of its
      subsidiaries) to Newshelf shall be notified by SBSA simultaneously with delivery of the SBSA
      Notice. Any exercise of the Call Option by Oceana will be for 5% (five per cent) or less of
      Oceana's issued shares. If the Call Option is exercised by a subsidiary of Oceana, the exercise
      of the Call Option by such subsidiary will be for 10% (ten per cent) or less of Oceana's issued
      shares, less treasury shares already held by all Oceana subsidiaries at that time.
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      The rights and obligations of the parties under the Call Option Agreement shall continue and
      remain in force until Newshelf has discharged all of its obligations to SBSA under and in terms
      of the Subscription Agreement.

3.    Financial effects

      There are no financial effects due to the Call Option currently not being exercisable as the
      Oceana share price is substantially in excess of the bank covenant threshold. Should the Call
      Option ever be exercised, Brimstone shareholders will be informed by means of a SENS
      announcement of the financial effects at the time based on the actual price and number of
      Oceana Shares repurchased by Oceana.

4.    Categorisation of the Call Option

      The Call Option, if exercised in full, is categorised as a Category 2 transaction in terms of the
      JSE Listings Requirements.




8 November 2012

Cape Town


Investment Bank and Sponsor
Nedbank Capital

Date: 08/11/2012 01:14:00 Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited ('JSE'). 
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