Impala Platinum Hldg Indigenisation implementation plan for Zimplats

 
TIDMIPLA 
 
Impala Platinum Holdings Limited 
(Incorporated in the Republic of South Africa) 
(Registration No. 1957/001979/06) 
ISIN: ZAE000083648 
JSE Share Code : IMP 
LSE Share Code : IPLA 
ADR Code : IMPUY 
 
("Implats" or "the Company") 
 
NEWS RELEASE 
 
11 January 2013 
 
        Implats agrees indigenisation implementation plan for Zimplats 
 
EMBARGO: For immediate release 
 
Ticker symbols:    Impala Platinum Holdings Limited ("Implats") is pleased to 
                   announce that its 87% held subsidiary, Zimplats Holdings 
JSE: Imp           Limited (Zimplats Holdings"), has concluded a non-binding 
                   term sheet in respect of proposed indigenisation 
LSE: Ipla          implementation plans ("IIP") with the Government of Zimbabwe 
                   (as represented by the Ministry of Youth Development, 
ADR: Impuy         Indigenisation and Empowerment) ("the Government"). 
 
Queries:           The term sheet, which will be signed today, stipulates the 
                   key terms, subject to certain conditions precedent, for the 
Bob Gilmour        sale by Zimplats Holdings of an aggregate 51% equity 
                   ownership ("the Indigenisation Shares") of Zimbabwe Platinum 
[phone]/43 Mines (Private) Limited ("Zimplats") to select Indigenous 
                   Entities as set out below. Zimplats Holdings will retain the 
[phone]    balance of 49% of Zimplats. 
 
Website:           The purchase price for the Indigenisation Shares, after 
                   taking into account the payment for the release of ground 
www.implats.co.za  obligation (in lieu of indigenisation credits), is US$971 
                   million (R8.3 billion) ("the Transaction"). 
Ticker symbols: 
                   Zimplats Holdings will facilitate the Transaction by 
JSE: Imp           providing vendor funding to the Indigenous Entities at an 
                   interest rate of 10% per annum. The vendor financing will be 
LSE: Ipla          repayable from 85% of the dividends declared by Zimplats on 
                   the Indigenisation Shares. The proceeds, as and when 
ADR: Impuy         received by Zimplats Holdings, will be declared as a 
                   dividend to Implats or used to fund Zimplats Holdings' share 
Queries:           of funding requirements of Zimplats. Management of Zimplats 
                   will remain with Zimplats Holdings. 
Bob Gilmour 
                   In terms of the IIP the following interests in Zimplats will 
[phone]/43 be sold to the parties named below, together constituting 
                   the "Indigenous Entities" as referred to above : 
[phone] 
                     * 10% to the Zimplats Mhondoro-Ngezi Chegutu Zvimba 
Website:               Community Share Ownership Trust ("Community Trust") for 
                       the benefit of communities surrounding the business 
www.implats.co.za      operations. 
 
Ticker symbols:      * 10% to an employee share ownership trust for the benefit 
                       of all full time indigenous employees. 
JSE: Imp 
                     * 31% to the National Indigenisation and Economic 
LSE: Ipla              Empowerment Fund ("NIEEF"). 
 
ADR: Impuy         Zimplats has agreed to provide seed capital to the Community 
                   Trust of an aggregate amount of US$10.0 million. The first 
Queries:           instalment of US$3.3 million was paid to the Community Trust 
                   in June 2012, with the subsequent two instalments being 
Bob Gilmour        payable in financial years 2013 and 2014 respectively. This 
                   will be construed as Corporate Social Investment spending by 
[phone]/43 Zimplats for the purposes of the applicable law. 
 
[phone]    Should future funding be raised by equity subscriptions, 
                   then all parties are required to contribute their respective 
Website:           pro rata share, failing which dilution is provided for. 
 
www.implats.co.za  The Transaction is subject to certain conditions precedent, 
                   including, amongst others: 
 
                     * Implats, Zimplats Holdings, Zimplats and the Indigenous 
                       Entities concluding definitive transaction agreements; 
 
                     * the amendment of the 24 May 2006 Release of Ground 
                       Agreement ("ROGA") to provide for a payment by the 
                       Indigenous Entities to Zimplats of US$153 million in 
                       settlement of the Government `s outstanding ROGA 
                       obligations; 
 
                     * that a certificate of compliance is issued confirming 
                       current and future compliance by Implats, Zimplats 
                       Holdings and Zimplats ("the Zimplats Group") with 
                       applicable indigenisation laws and requirements 
                       following the implementation of the IIP; 
 
                     * the parties obtain all necessary regulatory approvals, 
                       including Zimbabwe exchange control approval; 
 
                     * the Zimplats Group entities obtain the requisite Board 
                       and shareholder approvals required to implement the IIP; 
                       and 
 
                     * an exemption being obtained for Zimbabwean withholding 
                       tax on interest paid by the Indigenous Entities to 
                       Zimplats Holdings under the vendor financing 
                       arrangements. 
 
                   It was further agreed that by 30 June 2013 the Government 
                   would use its best endeavours in good faith to, amongst 
                   other things,: 
 
                     * amend the 2012 Mining Regulations in such a manner so as 
                       to reduce all ground rentals payable by Zimplats to the 
                       same levels as were in force immediately prior to the 
                       promulgation and coming into force of the 2012 
                       regulations; and 
 
                     * amend the Mining Agreement and fiscal terms currently 
                       applicable to Zimplats such that Additional Profits Tax 
                       and royalty rates are no worse than those granted/ 
                       provided to any other Platinum Group Metal mining entity 
                       operating in Zimbabwe. 
 
                   The parties have committed to co-operate to fulfil the 
                   conditions precedent by 30 June 2013. The effective date of 
                   the Transaction will be the date on which the conditions 
                   precedent are fulfilled. 
 
                   The negotiation and conclusion of the definitive transaction 
                   agreements will critically affect the accounting treatment 
                   of the Transaction. Shareholders will be advised once 
                   binding definitive transaction agreements have been entered 
                   into, which advice will include the detailed financial 
                   effects of the transaction. 
 
                   Terence Goodlace, CEO of Implats said: "This agreement 
                   underlines our commitment to good corporate citizenship and 
                   lays the foundation for the creation of a sustainable 
                   Zimbabwean platinum mining company capable of attracting the 
                   investment needed to deliver future benefits to our 
                   shareholders, the people of Zimbabwe, our employees and the 
                   local community." 
 
                                                                           ENDS 
 
 
 
END