Intl Mining & Infrast Corp PLC New Bond Raises US$22,000,000 (9441E)

TIDMIMIC

RNS Number : 9441E

Intl Mining & Infrast Corp PLC

09 November 2015

9 November 2015

INTERNATIONAL MINING & INFRASTRUCTURE CORPORATION PLC

("IMIC" or the "Company")

New Bond Raises US$22,000,000

International Mining & Infrastructure Corporation plc (AIM: IMIC), the Company focused on unlocking the value of iron ore in Africa, is pleased to announce that it has successfully raised US$22,000,000 via a bond instrument (the "New Bond"). The Company also announces certain proposed changes to the terms of its four existing bond instruments.

The New Bond has been issued for a term of 4 years and is due to mature on 5 November 2019. The New Bond bears interest at the fixed rate of 15 per cent. per annum with 3 per cent payable on 5 November in each year commencing in 2016 and 12 per cent being deferred and payable with the principal of the New Bond at maturity.

As part of the arrangements relating to the issuance of the New Bond, the Company's subsidiary Caminex S.A. ("Caminex") irrevocably undertakes, subject to IMIC shareholders' approval, to allow the holders of the New Bond ("New Bondholders") the option to acquire 4,903 shares in Caminex ("Caminex Option") representing 49.5 per cent of the enlarged issued share capital of Caminex, being 9,905 shares, at the nominal value of Central African CFA francs 10,000 per Caminex share. The Caminex Option is exercisable at any time from month 19 after the date of issue of the New Bond up to the maturity date of the New Bond.

In addition, as part of the New Bond issuance introductory fee, IMIC will issue warrants ("IMIC Warrants") to acquire 5,034,612 ordinary shares in IMIC, representing 2.5 per cent of the enlarged issued share capital of IMIC, being 201,384,462 shares, at the nominal value of 0.2 pence per ordinary share. The IMIC Warrants are exercisable at any time within the 4 year period of the New Bond.

Caminex has agreed to make a royalty payment, subject to IMIC shareholders' approval, payable to the New Bondholders over a 35 year term, subject to a formal agreement between Caminex and the New Bondholders, payable at US$1 per tonne produced at Ntem, targeted at 4 million tonnes over a minimum 15 year life of mine, and 25 cents per tonne produced at Nkout, targeted between approximately 16 million tonnes initially and ramping up to 35 million tonnes.

The Company has agreed to grant the New Bondholders and the existing bondholders (the bondholders of the bonds stated in Table 1 below, "Existing Bondholders") security over all the Company's shares in Caminex, IMIC's operating subsidiary which holds the Ntem, Nkout and Akonolinga iron ore assets in Cameroon, representing 99.4% of the issued share capital of Caminex.

The New Bondholders are entitled at any time up to the end of the term of the New Bond to nominate a director to the Board of IMIC, subject to regulatory approvals.

In addition, an independent audit firm will be appointed to prepare an audit report on a quarterly basis for the New Bondholders with regard to spending and progress on the Definitive Feasibility Study for the Ntem project, an exciting and economically viable project at the current iron ore prices that benefits from close proximity to the existing Kribi port, high-quality, 70% Fe premium product and potential for significant capex reduction through "Build-Own-Operate-Transfer" solutions for the project's infrastructure components. A scoping study confirmed the strength of the Ntem project and demonstrated that it is capable of generating favourable financial returns, even in the current cyclical downturn in global iron ore prices.

Proceeds from the New Bond issue will be used by IMIC to advance the development of the Company's assets, including completion of the Definitive Feasibility Study for the Ntem project, to meet the Company's working capital purposes, as well as to service essential debt obligations of IMIC.

The New Bond provides for various events of default. In case of the occurrence of an event of default, the New Bondholders may, by written notice to the Company, declare all outstanding amounts under the New Bond and any interest thereon to become immediately repayable. The security granted in respect of the Caminex shares will also become enforceable upon the service of such notice.

These events of default include inter alia:

-- any incorrect or misleading representation or statement that proves to have been made by the Company in connection with the New Bond;

   --      enforcement of security created by any mortgage or charge executed by the Company; 
   --      failure to grant the New Bondholders the Caminex Option before 31 December 2015; 

-- failure to grant in favour of the Trustee, security over the Company's entire shareholding in Caminex before 31 December 2015;

-- the security interest granted over the Company's entire shareholding in Caminex is not in full force and effect within 90 days of the issue date of the New Bond;

   --      failure to raise US$2,000,000 of equity within 180 days of the issue date of the New Bond; 
   --      failure to enter into a royalty agreement within 30 days of the issue date of the New Bond; 
   --      default by Caminex under the royalty agreement or failure to secure permit renewals; 

-- any vote cast by any shareholder of IMIC which may in any way affect any benefits of the New Bondholders in connection with the issuance of the New Bond;

   --      occurrence of a change of control in respect of the Company; 

The New Bond includes a negative pledge by the Company, or any of its subsidiaries, not to grant security over any of the Company's assets, revenues or any present or future undertakings at any point prior to the final redemption date of the New Bond (other than the security requested by the Existing Bondholders) without the approval of the New Bondholders.

Following announcements relating to four of IMIC's existing bonds, on 17 April, 28 April and 22 October 2015 (together "Existing Bonds", illustrated in Table1), IMIC is pleased to announce it continues to take steps to further restructure the interest payable on the Existing Bonds to allow more effective fund management ensuring progressive development of its iron ore projects in Cameroon.

Table1. Existing Bonds

 
  Issue Date    Amount US$   Restructured   Coupon    Maturity 
                               Announced 
-------------  -----------  -------------  -------  ------------ 
 18 Oct 2012    10,000,000   17 Apr 2015      5%     18 Oct 2020 
-------------  -----------  -------------  -------  ------------ 
 16 Apr 2013    30,000,000   28 Apr 2015      5%     30 Oct 2021 
-------------  -----------  -------------  -------  ------------ 
 11 Jun 2013    20,000,000   28 Apr 2015      5%     30 Oct 2021 
-------------  -----------  -------------  -------  ------------ 
 26 Nov 2013    30,000,000   22 Oct 2015      5%     20 Dec 2020 
-------------  -----------  -------------  -------  ------------ 
 

Under the new proposed terms, with effect from October 2015 the interest of 5 per cent. payable on the Existing Bonds will be paid at 3 per cent. on an annual basis and the remaining 2 per cent. will be deferred to the end of term of each of the Existing Bonds, accrued and repaid at maturity of each Existing Bond. In addition, the Existing Bondholders have requested the Company to grant security for the Existing Bonds and the Company has agreed to this request. These terms have been agreed in principle with the Existing Bondholders and are subject to approval by 75 per cent majority of the votes cast at the Existing Bondholders meeting to be held in the next few weeks.

Ethelbert Cooper, IMIC's Chairman, commented:

"I am delighted to announce the New Bond issue and am particularly pleased that we have been able to successfully complete this fundraising in such a challenging commodity price environment. This new investment demonstrates IMIC's ability to secure financing which will allow the Company to accelerate the development of its assets and significantly strengthen our balance sheet. I am pleased with the continued support and confidence placed in the Company by the Bondholders. The further restructuring of the Existing Bonds will be substantially beneficial to IMIC as it will provide increased financial and operational flexibility and allow more adequate fund allocation for continued advancement of our projects."

For further information, please contact:

 
 International Mining & Infrastructure        www.imicplc.com 
  Corporation plc 
 Ethelbert Cooper, Chairman 
  Haresh Kanabar, Chief Financial             [phone] 
  Officer                                                3340 
 Pareto Securities Limited - Sole           www.paretosec.com 
  Broker                                      [phone] 
  Guy Wilkes / Will Slack                                4370 
 Buchanan - Financial PR                  www.buchanan.uk.com 
  Mark Court / Sophie Cowles                  [phone] 
                                                         5000 
 

About IMIC

IMIC's strategy is, in conjunction with its partner AIOG, working to develop fundable solutions to infrastructure provision for iron ore resources in West and Central Africa. In support IMIC will seek to acquire interests in iron ore projects that would benefit from a specific infrastructure solution. IMIC made its first investment with the Dec 2013 acquisition of Afferro Mining Inc, taking ownership of four iron ore deposits in Cameroon, the most advanced asset being Nkout. IMIC plans to continue to develop its assets, including accelerating the feasibility studies of the smaller Ntem deposit, which is located only 80km from Kribi deep water port.

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