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ORION MINERALS NL - Tembo Capital Extends Repayment Terms of $6M Bridge Loan Advanced for the Prieska Zinc-Copper Project

Release Date: 15/11/2017 08:55
Code(s): ORN     PDF:  
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Tembo Capital Extends Repayment Terms of $6M Bridge Loan Advanced for the Prieska Zinc-Copper Project

Orion Minerals NL
Incorporated in the Commonwealth of Australia
Australian Company Number 098 939 274
ASX share code: ORN
JSE share code: ORN
ISIN: AU000000ORN1
(“Orion” or “the Company”)

TEMBO CAPITAL EXTENDS REPAYMENT TERMS OF $6M BRIDGE LOAN ADVANCED FOR THE
PRIESKA ZINC-COPPER PROJECT

    -   Private equity group Tembo Capital extends the term of the $6M Bridge Loan, confirming its continued
        support of Orion.

    -   The extension to the term of the Bridge Loan, combined with the recently announced Share
        placement, underpins the intensive drilling campaign and bankable feasibility study at the Prieska
        Zinc-Copper Project

    -   The ongoing drill program, which has returned significant results in the past four months, is aimed at
        generating a JORC compliant Mineral Resource estimate to support the bankable feasibility study
        now underway.

Orion Minerals NL (ASX/JSE: ORN) (Orion or the Company) is pleased to advise that mining-focused,
private equity group Tembo Capital (Tembo), has confirmed its continued support of Orion through an
extension to the term of the $6M bridge loan facility from 15 December 2017 to 31 May 2018.

On 18 August 2017, Orion announced that a $6M bridge loan facility had been agreed with Tembo Capital
Mining Fund II LP (Bridge Loan Agreement). In addition to the Bridge Loan, Tembo’s affiliate, Ndovu Capital
X BV subscribed for 73M ordinary Orion shares (Shares) through the placement of Shares to raise $1.75M at
an issue price of 2.4 cents per Share.

Under the terms of Bridge Loan Agreement, Orion agreed that it will use best endeavours to undertake a
capital raising by 15 December 2017 (now extended to 31 May 2018), to raise additional equity to progress
the Prieska Zinc-Copper Project (Prieska Project) bankable feasibility study (BFS) and to continue its South
African exploration programs (refer to ASX release 18 August 2017 for key terms of the Bridge Loan
Agreement).

Following the announcement of the Bridge Loan, on 30 October 2017, Orion advised that it is undertaking a
$5.5M capital raising. The placement to sophisticated and professional investors will be for up to 229.167M
Shares at an issue price of 2.4 cents per Share. The capital raising will occur in two stages, being:
    - Tranche 1 – 144.583M Shares using the Company’s 15% placement capacity under ASX Listing Rule
      7.1 to raise $3.47M. Tranche 1 Shares were issued on 3 November 2017; and
    - Tranche 2 - up to 84.583M Shares to raise $2.03M (subject to shareholder approval, at a general
      meeting of shareholder to be held 13 December 2017 (General Meeting).
    In addition, approval will also be sought at the General Meeting for Orion’s Chairman, Mr Denis Waddell
    to subscribe for up to 10.4M Shares at 2.4 cents, to raise $0.25M, (together the Placement).

As announced on 12 April 2017, the Company entered into an agreement with Tembo in respect of a placement
and strategic relationship with Tembo, pursuant to which Tembo was granted an anti-dilution right to maintain
its percentage holding in the Company where the Company conducts subsequent equity raisings (Top-up
Right).

Tembo’s interest in the Company will be diluted as a result of the Placement. Accordingly, under the Top-up
Right, the Company will offer Tembo the right to subscribe for that number of Shares which would allow Tembo
to maintain its percentage holding in the Company (Top-up Shares) at an issue price of 2.4 cents. Assuming
that all Shares under the Placement are issued, the maximum number of Top-up Shares to be offered to
Tembo is 60M ($1.4M). At a shareholder meeting to be held on 13 December 2017, the Company is seeking
approval for the issue of the maximum Top-up Shares at a deemed issue price of 2.4 cents, which is the same
issue price as the Shares being offered under the Placement.
Top-Up Shares may be issued in consideration for reducing the amount re-payable to Tembo under the Bridge
Loan at the deemed issue price of 2.4 cents per Share.

The extension to the term of the Bridge Loan relieves Orion of its requirement to repay the Bridge Loan by 15
December 2017 ensuring that proceeds from the Placement and Bridge Loan can be used principally to
progress the intensive resource drilling campaign at the Company’s Prieska Project, where significant drill
results have been returned in recent months. The current program is the next step in the process to define a
maiden Mineral Resource estimate as defined in the Australasian Code for Reporting of Exploration Results,
Mineral Resources and Ore Reserves (JORC Code) and will be fed into the BFS (refer ASX release 11 July
2017). The BFS will build on the substantial dataset relating to historical mining and processing, as well as the
new information being generated by the onsite activities. Funds will also be used for working capital purposes
and to continue regional and near mine exploration programs, including an airborne electromagnetic survey
and regional geochemistry on the Company’s Northern Cape, South African tenements.

As part of the terms of amendment to the Bridge Loan Agreement, Orion has agreed to an increase in the
establishment fee from 5% to 6.67% of the Bridge Loan facility amount (capitalised). Orion has drawn down a
total of $5M against the Bridge Loan facility.

About Tembo

Tembo is a private equity group targeting junior and mid-tier mining investment opportunities in developing
countries. Tembo has technical and financial experience with in-house expertise in the fields of geology, mine
engineering, metallurgy, mining finance and private equity. This experience, coupled with a strong network of
relationships in the mining industry, enables Tembo to add long-term value to its investments through technical
input, strategic guidance, financial structuring advice and industry introductions. Tembo aims to work
collaboratively with its investee companies through a long term partnership-type approach.


Denis Waddell
Chairman

15 November 2017

ENQUIRIES

Investors                                                  JSE Sponsor
Errol Smart – Managing Director & CEO                      Rick Irving
Denis Waddell – Chairman                                   Merchantec Capital
T: +61 (0) 3 8080 7170                                     T: +27 (0) 11 325 6363
E: info@orionminerals.com.au                               E: rick@merchantec.co.za

Media
Michael Vaughan                                            Emily Fenton
Fivemark Partners, Australia                               Tavistock, UK
T: +61 (0) 422 602 720                                     T: +44 (0) 207 920 3150
E: michael.vaughan@fivemark.com.au                         E: orion@tavistock.co.uk

Suite 617, 530 Little Collins Street
Melbourne, VIC, 3000

Disclaimer

This release may include forward-looking statements. Such forward-looking statements may include, among other
things, statements regarding targets, estimates and assumptions in respect of metal production and prices,
operating costs and results, capital expenditures, mineral reserves and mineral resources and anticipated grades
and recovery rates, and are or may be based on assumptions and estimates related to future technical, economic,
market, political, social and other conditions. These forward-looking statements are based on management’s
expectations and beliefs concerning future events. Forward-looking statements inherently involve subjective
judgement and analysis and are necessarily subject to risks, uncertainties and other factors, many of which are
outside the control of Orion. Actual results and developments may vary materially from those expressed in this
release. Given these uncertainties, readers are cautioned not to place undue reliance on such forward-looking
statements. Orion makes no undertaking to subsequently update or revise the forward-looking statements made in
this release to reflect events or circumstances after the date of this release. All information in respect of Exploration
Results and other technical information should be read in conjunction with Competent Person Statements in this
release. To the maximum extent permitted by law, Orion and any of its related bodies corporate and affiliates and
their officers, employees, agents, associates and advisers:

-       disclaim any obligations or undertaking to release any updates or revisions to the information to reflect any
        change in expectations or assumptions;
-       do not make any representation or warranty, express or implied, as to the accuracy, reliability or
        completeness of the information in this release, or likelihood of fulfilment of any forward-looking statement
        or any event or results expressed or implied in any forward-looking statement; and
-       disclaim all responsibility and liability for these forward-looking statements (including, without limitation,
        liability for negligence).

Date: 15/11/2017 08:55:00 Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited ('JSE'). 
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