Ashanti Announces Early Redemption of Its 5.5% Exchangeable Guaranteed Notes Due March 2003.Business Editors ASHANTI Ashanti (äshän`tē) or Asante (äsän`tē), historic and modern administrative region, central Ghana, W Africa. The region is the source of much of Ghana's cocoa. GOLDFIELDS n. 1. A small slender woolly annual (Lasthenia chrysostoma) with very narrow opposite leaves and branches bearing solitary golden-yellow flower heads; it grows from Southwestern Oregon to Baja California and Arizona; - it is often cultivated. COMPANY LIMITED("ASHANTI")(NYSE NYSE See: New York Stock Exchange :ASL ASL - Algebraic Specification Language ) - cross default in respect of financial indebtedness of material group members (excluding certain subsidiaries, such as Kimin and ring fenced project finance entities) in excess of US$5 million; - insolvency of material group members; - nationalisation of certain assets of the Ashanti Group; - reduction of foreign exchange retention levels; - termination of the margin free trading arrangements other than in accordance with the terms of the Interim Margin Free Trading Letter, or the New Margin Free Trading Letter (as the case may be) and termination of hedging agreements without the consent of Ashanti and its risk management committee; and - change of control of Ashanti which is reasonably likely to have a material adverse effect. Sam (1) (Security Accounts Manager) The part of Windows NT that manages the database of usernames, passwords and permissions. A SAM resides in each server as well as in each domain controller. See PDC and trust relationship. Jonah Jonah (jō`nə), prophetic book of the Bible. It tells the story of a prophet called by God to preach repentance to the city of Nineveh. According to the Second Book of Kings, Jonah lived during the reign (c.786 B.C.–c.746 B.C. , Chief Executive of Ashanti, said "The transaction we have announced today meets all of Ashanti's financial obligations pursuant to the Exchangeable Guaranteed Notes and its existing revolving credit Revolving Credit A line of credit where the customer pays a commitment fee and is then allowed to use the funds when they are needed. It is usually used for operating purposes, fluctuating each month depending on the customers current cash flow needs. facility prior to their respective maturities. Furthermore, the transaction enhances shareholder value and minimises dilution Dilution A reduction in earnings per share of common stock that occurs through the issuance of additional shares or the conversion of convertible securities. Notes: Adding to the number of shares outstanding reduces the value of holdings of existing shareholders. for existing shareholders when compared with other alternatives. We are grateful for the support shown by our major shareholders and creditors throughout this process." Enquiries : Ashanti Goldfields Company Limited Sam Jonah, Chief Executive + 00 233 21 774913 S. Venkatakrishan, Chief Financial Officer, + 00 233 21 778171 Golin Harris Harris, Scotland: see Lewis and Harris. - North American North American named after North America. North American blastomycosis see North American blastomycosis. North American cattle tick see boophilusannulatus. contact Alan A`lan´ n. 1. A wolfhound. Jordan Jordan, country, Asia Jordan, officially Hashemite Kingdom of Jordan, kingdom (2005 est. pop. 5,760,000), 35,637 sq mi (92,300 sq km), SW Asia. It borders on Israel and the West Bank in the west, on Syria in the north, on Iraq in the northeast, and on Saudi , +1 212 697 9191 Close Brothers Corporate Finance Limited Martin Gudgeon, Director, + 44 20 7655 3100 Houlihan Lokey Howard Howard, English noble family. Landowners in Norfolk from the 13th cent., the Howards obtained the duchy of Norfolk through the marriage of Sir Robert Howard to Margaret Mowbray, daughter of Thomas Mowbray, 1st duke of Norfolk. & Zukin Capital, Inc. Joe Swanson Lieutenant Joseph "Joe" Swanson is a fictional character in the Fox animated television show Family Guy. His voice is supplied by actor Patrick Warburton. He is a super-macho paraplegic police officer and is married to perpetually pregnant wife, Bonnie, and has one son, , Senior Vice President, + 44 20 7839 3355 CIBC World Markets CIBC World Markets is the investment banking division of the Canadian Imperial Bank of Commerce. It helps governments, large companies, and other large institutions obtain capital and credit and is a primary dealer in U.S. Treasury securities. plc Andy Quinn Quinn or O'Quinn is a surname of Irish origin. It comes from the original Irish name Ó Cuinn, ie descendants of Conn. It means wisdom or chief. , Managing Director, + 44 20 7234 6400 Close Brothers Corporate Finance Limited, which is authorised Adj. 1. authorised - endowed with authority authorized lawful - conformable to or allowed by law; "lawful methods of dissent" legitimate - of marriages and offspring; recognized as lawful in the United Kingdom to carry on investment business by the Financial Services Authority The Financial Services Authority ("FSA") is an independent non-departmental public body and quasi-judicial body that regulates the financial services industry in the United Kingdom. Its main office is based in Canary Wharf, London, with another office in Edinburgh. , is acting for Ashanti and no one else in connection with the Cash Redemption Alternative and will not be responsible to anyone other than Ashanti for providing the protections afforded to its clients nor for giving advice in relation to the Cash Redemption Alternative. CIBC World Markets plc , which is authorised in the United Kingdom to carry on investment business by the Financial Services Authority, is acting for Ashanti and no one else in connection with the Cash Redemption Alternative and will not be responsible to anyone other than Ashanti for providing the protections afforded to its clients nor for giving advice in relation to the Cash Redemption Alternative. This financial promotion is communicated by Ashanti Goldfields Company Limited and its contents have been approved for the purposes of the United Kingdom Financial Services The examples and perspective in this article or section may not represent a worldwide view of the subject. Please [ improve this article] or discuss the issue on the talk page. and Markets Act 2000 by Close Brothers Corporate Finance Limited. This announcement contains a number of statements relating to relating to relate prep → concernant relating to relate prep → bezüglich +gen, mit Bezug auf +acc Ashanti that are considered "forward looking statements" as defined in the Private Securities Litigation Reform Act The Private Securities Litigation Reform Act of 1995 (PSLRA) implemented several significant substantive changes affecting certain cases brought under the federal securities laws, including changes related to pleading, discovery, liability, class representation and awards fees and 1995 of the United States of America UNITED STATES OF AMERICA. The name of this country. The United States, now thirty-one in number, are Alabama, Arkansas, Connecticut, Delaware, Florida, Georgia, Illinois, Indiana, Iowa, Kentucky, Louisiana, Maine, Maryland, Massachusetts, Michigan, Mississippi, Missouri, New Hampshire, , including but not limited to its discussions of the Cash Redemption Alternative. Such statements are based on current plans, information and intentions and certain external factors which may be beyond the control of Ashanti and, therefore, undue reliance should not be placed on them. Forward looking statements speak only as of the date they are made, and Ashanti undertakes no obligation to update publicly any of them in light of new information or future events. These statements are subject to risks and uncertainties that could cause actual occurrences to differ materially from the forward looking statements. Additional risk factors affecting Ashanti are set out in Ashanti's filings with the US Securities and Exchange Commission. This press release does not constitute an offer to sell or the solicitation solicitation In criminal law, the act of asking, inducing, or directing someone to commit a crime. The person soliciting another becomes an accomplice to the crime. The term also refers to the act of obtaining bribes, as well as to the crime of a prostitute who offers sexual of an offer to buy nor shall there be any sale or distribution of securities in any such jurisdiction in which such offer, sale or distribution is not permitted. ASHANTI GOLDFIELDS COMPANY LIMITED ("ASHANTI") ASHANTI ANNOUNCES EARLY REDEMPTION OF ITS 5 1/2% EXCHANGEABLE GUARANTEED NOTES DUE MARCH 2003 Background On 25 January January: see month. 2002 Ashanti announced that it had agreed conditionally with an ad hoc committee ad hoc committee A committee formed with the purpose of addressing a specific issue or issues, which theoretically is disbanded once its raison d'etre is finished (the "Ad Hoc Committee") of holders of the outstanding 5 1/2% Exchangeable Guaranteed Notes due 2003 of Ashanti Capital Limited ("ACL See access control list. 1. ACL - Access Control List. 2. ACL - Association for Computational Linguistics. 3. ACL - A Coroutine Language. A Pascal-based implementation of coroutines. ["Coroutines", C.D. ") (the "Existing Notes") a proposed restructuring restructuring - The transformation from one representation form to another at the same relative abstraction level, while preserving the subject system's external behaviour (functionality and semantics). of the Existing Notes (the "Proposed Restructuring"). Subsequent to that date Ashanti has proceeded with the steps required to implement the Proposed Restructuring. These steps have included: recommending the Proposed Restructuring, posting the public documentation required to implement the Proposed Restructuring (the "Scheme Documentation") and convening con·vene v. con·vened, con·ven·ing, con·venes v.intr. To come together usually for an official or public purpose; assemble formally. v.tr. 1. the requisite meetings of the holders of Existing Notes ("Noteholders") and holders of ordinary shares of no par value in Ashanti ("Ashanti Shares"). At the Court sanctioned meeting of Noteholders held on 17 June June: see month. 2002, approval was obtained from Noteholders for the Proposed Restructuring. The Proposed Restructuring remained conditional on, amongst other things, sanction sanction, in law and ethics, any inducement to individuals or groups to follow or refrain from following a particular course of conduct. All societies impose sanctions on their members in order to encourage approved behavior. of the Cayman Islands Cayman Islands (kā`mən), British dependency (2005 est. pop. 44,300), 100 sq mi (259 sq km), comprising three islands in the West Indies. Court and approval of the holders of Ashanti Shares at an extraordinary general meeting of Ashanti which had been convened for today. In view of the fact that the Board of Ashanti is able to make this announcement today, the Board of Ashanti will be proposing to indefinitely in·def·i·nite adj. Not definite, especially: a. Unclear; vague. b. Lacking precise limits: an indefinite leave of absence. c. adjourn adjourn v. the final closing of a meeting, such as a convention, a meeting of the board of directors, or any official gathering. It should not be confused with a recess, meaning the meeting will break and then continue at a later time. (See: recess, session) the extraordinary general meeting to be held later today and to withdraw the Proposed Restructuring. As stated in the press announcement released by Ashanti at the time of posting of the Scheme Documentation, the Ashanti Board continued to review any other bona fide [Latin, In good faith.] Honest; genuine; actual; authentic; acting without the intention of defrauding. A bona fide purchaser is one who purchases property for a valuable consideration that is inducement for entering into a contract and without suspicion of being proposals which it considered to be in the interests of Ashanti. On 11 June 2002, Ashanti made an announcement that it was considering a proposal relating to an alternative restructuring (the "Cash Redemption Alternative") pursuant to which all of the Existing Notes would be redeemed re·deem tr.v. re·deemed, re·deem·ing, re·deems 1. To recover ownership of by paying a specified sum. 2. To pay off (a promissory note, for example). 3. at par. With the support of its two major shareholders, an alternative structure is being implemented, which is believed by the Board to be in the better interests of existing Ashanti shareholders relative to the Proposed Restructuring. Cash Redemption Alternative The Board of Ashanti is now pleased to be able to announce that it is implementing the Cash Redemption Alternative which will result in the early redemption of the Existing Notes at par on 2 August 2002, together with accrued interest Accrued Interest The interest that has accumulated on a bond since the last interest payment up to but not including the settlement date. There are two methods for calculating accrued interest: 1) 360-day year method, used for corporate and municipal bonds. to that date in accordance Accordance is Bible Study Software for Macintosh developed by OakTree Software, Inc.[] As well as a standalone program, it is the base software packaged by Zondervan in their Bible Study suites for Macintosh. with the terms of the indenture An agreement declaring the benefits and obligations of two or more parties, often applicable in the context of Bankruptcy and bond trading. The term indenture primarily describes secured contracts and has several applications in U.S. law. governing gov·ern v. gov·erned, gov·ern·ing, gov·erns v.tr. 1. To make and administer the public policy and affairs of; exercise sovereign authority in. 2. the Existing Notes ("Existing Notes Indenture") and the early repayment of the existing revolving credit facility ("Existing RCF RCF Remote Call Forwarding RCF Residential Care Facility RCF Relative Centrifugal Force RCF Rolling Contact Fatigue RCF Refractory Ceramic Fiber RCF Revolving Credit Facility RCF Rock Characterisation Facility RCF Registration Confirm RCF Retained Cash Flow "). The redemption of the US$218,571,000 of the outstanding Existing Notes and the existing revolving credit facility will be funded by part of the proceeds of a new fundraising
- cross default in respect of financial indebtedness of material group members (excluding certain subsidiaries, such as Kimin and ring fenced project finance entities) in excess of US$5 million; - insolvency of material group members; - nationalisation of certain assets of the Ashanti Group; - reduction of foreign exchange retention levels; - termination of the margin free trading arrangements other than in accordance with the terms of the Interim Margin Free Trading Letter, or the New Margin Free Trading Letter (as the case may be) and termination of hedging agreements without the consent of Ashanti and its risk management committee; and - change of control of Ashanti which is reasonably likely to have a material adverse effect. Lonmin Lonmin plc (LSE: LMI, JSE: LOLMI), formerly Lonrho plc, was incorporated in the United Kingdom on 13 May 1909 as the London and Rhodesian Mining Company Limited. has today granted to the Government of Ghana Ghana, country, Africa Ghana, officially Republic of Ghana, republic (2005 est. pop. 21,030,000), 92,099 sq mi (238,536 sq km), W Africa, on the Gulf of Guinea, an arm of the Atlantic Ocean. The capital and largest city is Accra. (the "Government") a transferable call option (the "Call Option") to enable the Government to acquire new Ashanti Shares arising from the conversion of $28,430,695 of the MENs if and to the extent that the MENs are exchanged into new Ashanti Shares in connection with the Proposed Rights Issue. The MENs represent the entitlement An individual's right to receive a value or benefit provided by law. Commonly recognized entitlements are benefits, such as those provided by Social Security or Workers' Compensation. of the Government and Lonmin to new Ashanti Shares under the Proposed Rights Issue. If the Proposed Rights Issue is implemented, all holders of Ashanti Shares will be able to participate in the re-capitalisation of Ashanti on the same basis as Lonmin and the Government. It is not currently intended that the Proposed Rights Issue will be underwritten. Completion of the Cash Redemption Alternative The Cash Redemption Alternative is now unconditional HEIR, UNCONDITIONAL. A term used in the civil law, adopted by the Civil Code of Louisiana. Unconditional heirs are those who inherit without any reservation, or without making an inventory, whether their acceptance be express or tacit. Civ. Code of Lo. art. 878. UNCONDITIONAL. in all respects and accordingly : - cross default in respect of financial indebtedness of material group members (excluding certain subsidiaries, such as Kimin and ring fenced project finance entities) in excess of US$5 million; - insolvency of material group members; - nationalisation of certain assets of the Ashanti Group; - reduction of foreign exchange retention levels; - termination of the margin free trading arrangements other than in accordance with the terms of the Interim Margin Free Trading Letter, or the New Margin Free Trading Letter (as the case may be) and termination of hedging agreements without the consent of Ashanti and its risk management committee; and - change of control of Ashanti which is reasonably likely to have a material adverse effect. Enlarged RCF Ashanti has entered into a new secured US$200,000,000 revolving credit facility with a group of 14 banks including the eight banks who participated in the Existing RCF. All conditions precedent to the Enlarged RCF have been satisfied. It will be repaid in eight semi-annual instalments each of US$20,000,000 commencing in 12 months from today with a further final instalment of US$40,000,000. The term of the Enlarged RCF is 5 years. Status of the margin free trading arrangements The requisite majority of Ashanti's hedge counterparties Counterparties The parties on either side of an interest rate swap or a currency, equity or commodity swap, or to an options or futures position. have approved the Cash Redemption Alternative and accordingly the margin free trading arrangements announced on 18 March 2002 have become unconditional and accordingly all the rights of the relevant hedge counterparties to call for margin have been cancelled. Ashanti will now have the benefit of ongoing margin free trading. Proposed Rights Issue Ashanti will seek to effect the Proposed Rights Issue as soon as practicable practicable adj. when something can be done or performed. once issues raised in comment letters from the Division of Corporation Finance of the United States United States, officially United States of America, republic (2005 est. pop. 295,734,000), 3,539,227 sq mi (9,166,598 sq km), North America. The United States is the world's third largest country in population and the fourth largest country in area. Securities and Exchange Commission (the "SEC") concerning Ashanti's 20-F for the year ended 31 December December: see month. 2000 have been resolved . The Proposed Rights Issue will also require the filing and clearing of prospectus documentation in a number of jurisdictions, including the United Kingdom and Ghana and a registration statement with the SEC. In light of the above, Ashanti is not in a position at this early stage to commit to a definitive timetable for the implementation of the Proposed Rights Issue. A further announcement will be made in due course in connection with the Proposed Rights Issue. It is currently intended that the subscription price of the Proposed Rights Issue will be set at US$5.40, although Ashanti reserves the rights to reduce the subscription price as it sees fit. It is not intended that the Proposed Rights Issue will be underwritten and therefore there is no guarantee that Ashanti will raise any new equity in the Proposed Rights Issue. Application of funds raised pursuant to the Cash Redemption Alternative Of the approximately US$315 million raised pursuant to the Cash Redemption Alternative, US$223,145,812 will be used to repay the Existing Notes in full which figure includes accrued interest to the early redemption date Redemption date The date on which a bond matures or is redeemed. redemption date The date on which a debt security is scheduled to be redeemed by the issuer. The redemption date is the scheduled maturity date or, if applicable, a call date. of 2 August 2002. Ashanti will be serving the notice of early redemption for the Existing Notes specifying 2 August 2002 as the date for repayment of the Existing Notes. US$223,145,812 will be deposited with The Bank of New York The Bank of New York, abbrieviated to BNY, was a global financial services company that existed until its merger with the Mellon Financial Corporation on July 2, 2007.[1] The bank now continues under the new name of The Bank of New York Mellon Corporation. as trustee under the provisions of the Existing Notes Indenture. The balance of the proceeds from the Cash Redemption Alternative will be used to fully repay the Existing RCF, meet the expenses of the Proposed Restructuring and Cash Redemption Alternative and to provide for the ongoing working capital requirements Capital requirements Financing required for the operation of a business, composed of long-term and working capital plus fixed assets. of Ashanti. Lonmin put option in connection with the early exercise of the Warrants (the "Put Option") In order to facilitate the early exercise of the Warrants, Lonmin has agreed to provide Warrantholders with the right to put to it, on certain dates, the Ashanti Shares resulting from the Early Warrant Exercise at US$3 per Ashanti Share. This Put Option is being provided by Lonmin at no cost to Ashanti and has been agreed between the Warrantholders and Lonmin. However, Ashanti has agreed with each of the Warrantholders exercising the Warrants that it will pay to them on a quarterly basis a fee which is intended to compensate the Warrantholders for the cost of funding the Early Warrant Exercise. Mandatorily Exchangeable Notes The US$75,000,000 of MENs which have today been issued effectively represent the early subscription by Lonmin on behalf of itself and the Government of their respective entitlements to subscribe for Ashanti Shares in the Proposed Rights Issue. Until the Proposed Rights Issue is completed or the MENs are otherwise exchanged into Ashanti Shares, the MENs will constitute unsecured debt Unsecured debt Debt that does not identify specific assets that the debtholder is entitled to in case of default. of the Ashanti Group which will, except as set out below, be subordinated to the Enlarged RCF until 30 June 2008. As part of the arrangements between Lonmin and the Government, Lonmin has given the Government the right to call at the subscription price for the Proposed Rights Issue for Ashanti Shares arising as a result of the exchange of US$28,430,695 of the MENs, being equivalent to the Government's pro-rata Pro-rata Used to describe a proportionate allocation. Notes: For example, a pro-rata dividend means that every shareholder gets an equal proportion for each share they own. See also: Dividend entitlement under the Proposed Rights Issue. The call option will expire expire /ex·pire/ (ek-spi´er) 1. to exhale. 2. to die. ex·pire v. 1. To breathe one's last breath; die. 2. To exhale. if the Proposed Rights Issue is not completed within 18 months. If Ashanti does not complete the Proposed Rights Issue within 18 months then it is obliged o·blige v. o·bliged, o·blig·ing, o·blig·es v.tr. 1. To constrain by physical, legal, social, or moral means. 2. to seek to obtain from its shareholders the necessary approvals to enable the Ashanti Shares resulting from exchange of the full US$75,000,000 of the MENs to be issued to Lonmin. The Government has undertaken to Ashanti and Lonmin to vote in favour of any resolution seeking such shareholder approvals. If a change of control of Ashanti occurs prior to the completion of the Proposed Rights Issue then the MENs will be redeemable Redeemable Eligible for redemption under the terms of an indenture. , together with interest at a rate equivalent to that applying under the Enlarged RCF, immediately following the relevant change of control. Other than in this event the MENs will only be redeemed on 30 June 2008 so long as the Proposed Rights Issue has not occurred by then. Assuming no dividends are paid to holders of Ashanti Shares prior to exchange of the MENs, no interest will be payable if the MENs exchange into Ashanti Shares. Shareholding of Lonmin and the Government Although Lonmin's percentage interest in the share capital of Ashanti will decrease immediately following implementation of the Cash Redemption Alternative because of the early exercise of 13,810,440 Warrants, it may increase in due course, depending upon the take-up in the Proposed Rights Issue and if the Put Option granted by Lonmin is exercised. A summary of the effects of the implementation of the Cash Redemption Alternative on Lonmin's shareholding and shareholding of the Government, based on certain assumptions, is set out below :
------------------------ ------------ ---------- ------------ --------
Ashanti's Lonmin's Government's Govern-
issued share Lonmin's percentage shareholding ment's
capital(1) shareholding holding % per-
centage
holding %
------------------------ ------------ ---------- ------------ --------
------------------------ ------------ ---------- ------------ --------
Before the
Cash Redemption
Alternative 112,714,222 36,000,000 31.94 21,978,104 19.50
------------------------ ------------ ---------- ------------ --------
------------------------ ------------ ---------- ------------ --------
Immediately
following
the Cash
Redemption
Altern-
ative(2) 126,524,662 36,000,000 28.45 21,978,104 17.37
------------------------ ------------ ---------- ------------ --------
------------------------ ------------ ---------- ------------ --------
Following the Rights Issue:
------------------------ ------------ ---------- ------------ --------
------------------------ ------------ ---------- ------------ --------
0% take-up
in Rights
Issue(3) 140,413,551 49,888,889(4) 35.53 21,978,104 15.65
------------------------ ------------ ---------- ------------ --------
------------------------ ------------ ---------- ------------ --------
0% take-up
in Rights
Issue and
Put Option
exercised
in full(5) 140,413,551 63,699,329 45.37 21,978,104 15.65
------------------------ ------------ ---------- ------------ --------
------------------------ ------------ ---------- ------------ --------
100% take-up
in Rights
Issue(6) 156,834,156 44,623,945 28.45 27,243,048 17.37
------------------------ ------------ ---------- ------------ --------
Lonmin has sought and obtained the approval of the Ghana Stock Exchange The Ghana Stock Exchange (GSE) is the principal stock exchange of Ghana. The exchange was incorporated in July 1989 with trading commencing in 1990. It currently has around 30 listed companies and 2 corporate bonds. All types of securities can be listed. ("GSE GSE general somatic efferent system. ") for the increase in its shareholding resulting from the exchange of the MENs and the exercise by the Warrantholders of the put option referred to above. General The listing particulars relating to the Ashanti Shares to be issued pursuant to the exercise of the Warrants will be published by 12 July July: see month. 2002 and listing for the Ashanti Shares resulting from the exercise of the Warrants on the LSE LSE - Language Sensitive Editor and GSE is currently being sought. Ashanti has cancelled US$31,429,000 principal amount of Existing Notes held by members of the Ashanti Group. A summary of the principal documents implementing the Cash Redemption Alternative is set out in Part II of this press release. The Directors of Ashanti (excluding Sam Jonah and Ed Haslam Haslam may refer to: People with the surname Haslam:
Enquiries : Ashanti Goldfields Company Limited Sam Jonah, Chief Executive, + 00 233 21 774913 S. Venkatakrishan, Chief Financial Officer, + 00 233 21 778171 Golin Harris - North American contact Allan Allan can refer to:
Close Brothers Corporate Finance Limited Martin Gudgeon, Director + 44 20 7655 3100 Houlihan Lokey Howard & Zukin Capital, Inc. Joe Swanson, Senior Vice President, + 44 20 7839 3355 CIBC World Markets plc Andy Quinn, Managing Director + 44 20 7234 6400 Close Brothers Corporate Finance Limited , which is authorised in the United Kingdom to carry on investment business by the Financial Services Authority, is acting for Ashanti and no one else in connection with the Cash Redemption Alternative and will not be responsible to anyone other than Ashanti for providing the protections afforded to its clients nor for giving advice in relation to the Cash Redemption Alternative. CIBC World Markets plc, which is authorised in the United Kingdom to carry on investment business by the Financial Services Authority, is acting for Ashanti and no one else in connection with the Cash Redemption Alternative and will not be responsible to anyone other than Ashanti for providing the protections afforded to its clients nor for giving advice in relation to the Cash Redemption Alternative. This financial promotion is communicated by Ashanti Goldfields Company Limited and its contents have been approved for the purposes of the United Kingdom Financial Services and Markets Act 2000 by Close Brothers Corporate Finance Limited. This announcement contains a number of statements relating to Ashanti that are considered "forward looking statements" as defined in the Private Securities Litigation Reform Act 1995 of the United States of America, including but not limited to its discussions of the Cash Redemption Alternative. Such statements are based on current plans, information and intentions and certain external factors which may be beyond the control of Ashanti and, therefore, undue reliance should not be placed on them. Forward looking statements speak only as of the date they are made, and Ashanti undertakes no obligation to update publicly any of them in light of new information or future events. These statements are subject to risks and uncertainties that could cause actual occurrences to differ materially from the forward looking statements. Additional risk factors affecting Ashanti are set out in Ashanti's filings with the US Securities and Exchange Commission. PART II The following is a summary of the material terms of each of the principal documents entered into in connection with the implementation of the Cash Redemption Alternative: Warrant Early Exercise Agreement The Warrant Early Exercise Agreement was entered into on 27 June 2002 between Ashanti, Ashanti Warrants Limited ("AWL") and certain Warrantholders (the "Exercising Warrantholders") pursuant to which such Warrantholders agreed to the early exercise of an aggregate of a minimum of 12,233,223 Warrants with effect from the date of the Warrant Early Exercise Agreement. Such Warrantholders agreed to pay the subscription proceeds due in an aggregate amount of at least US$41,431,320. In consideration of such early exercise, Ashanti has undertaken to pay to the Exercising Warrantholders a fee. The fee payable to each such Warrantholder is calculated as the product of: (a) US$3.00 (being the exercise price of a Warrant); (b) 3-month LIBOR LIBOR See: London Interbank Offered Rate LIBOR See London interbank offered rate (LIBOR). plus 25 basis points; (c) the lower of (i) the number of Ashanti Shares arising on early exercise of the relevant Warrants certified See certification. quarterly by each such Warrantholder as still being beneficially held by it; and (ii) the maximum number of Ashanti Shares into which such Warrantholder's relevant holding of Warrants converts in respect of the three tranches Tranches A piece, portion or slice of a deal or structured financing. This portion is one of several related securities that are offered at the same time but have different risks, rewards and/or maturities. "Tranche" is the French word for "slice". of Warrants, reducing on a cumulative basis; and (d) 90 days divided by 360 days. The fee is payable quarterly to each Exercising Warrantholder until the earlier of 28 April 2005 and the date a Warrantholder no longer holds any Ashanti Shares originally issued to it on early exercise of its Warrants. In certain circumstances CIRCUMSTANCES, evidence. The particulars which accompany a fact. 2. The facts proved are either possible or impossible, ordinary and probable, or extraordinary and improbable, recent or ancient; they may have happened near us, or afar off; they are public or , the Warrantholders agree not to make disposals of the Ashanti Shares arising on exercise of their Warrants except in accordance with certain US securities requirements. Ashanti has undertaken to procure To cause something to happen; to find and obtain something or someone. Procure refers to commencing a proceeding; bringing about a result; persuading, inducing, or causing a person to do a particular act; obtaining possession or control over an item; or making a person a listing of the Ashanti Shares arising on exercise of the Warrants on the Official List of the UK Listing Authority ("UKLA UKLA United Kingdom Listing Authority UKLA United Kingdom Literacy Association UKLA United Kingdom Lubricants Association UKLA United Kingdom Laser Association UKLA University of Kentucky Landscape Architecture UKLA University Klagenfurth ") and admission to trading on the LSE and the GSE. Lonmin/ Warrantholders Put Option Agreement The Put Option Agreement dated 27 June 2002 was entered into between Lonmin and the Exercising Warrantholders. The Put Option Agreement provides that such Warrantholders may put all or some of the Ashanti Shares into which their Warrants convert pursuant to the Warrant Early Exercise Agreement on Lonmin at a price of US$3.00 per Ashanti Share. The Put Options (which are non-transferable) are only exercisable upon three exercise dates, being 28 April 2004, 28 October 2004 and 28 April 2005 and each of the Warrantholders shall only be entitled en·ti·tle tr.v. en·ti·tled, en·ti·tling, en·ti·tles 1. To give a name or title to. 2. To furnish with a right or claim to something: to exercise on each date its options in respect of a maximum number of Ashanti Shares being the number of Ashanti Shares from which the A tranche Tranche One of several related securities offered at the same time. Tranches from the same offering usually have different risk, reward, and/or maturity characteristics. tranche A class of bonds. , B tranche and C tranche warrants have converted respectively (for example, the options in respect of the Ashanti Shares into which the A tranche warrants have converted are only exercisable on 28 April 2004). The purchase price of the Ashanti Shares under the Put Option Agreement is subject to certain adjustments, such as in the event of a sub-division or consolidation of the ordinary share capital of Ashanti, capital distributions or a deep discounted rights issue (other than the Proposed Rights Issue). The Put Options fall away upon a takeover offer for Ashanti becoming unconditional (or a scheme of arrangement becoming effective). MENs Deed Poll DEED POLL, contracts. A deed made by one party only is not indented, but polled or shaved quite even, and is, for this reason, called a deed poll, or single deed. Co. Litt. 299, a. 2. The MENs are constituted by, and issued subject to, and upon the conditions and with the benefit of the rights contained in, the MENs Deed Poll. Pursuant to the MENs Deed Poll, Ashanti Capital (Second) Limited ("ACSL ACSL Advanced Continuous Simulation Language (AEgis Technologies Group, Inc.) ACSL American Computer Science League ACSL Assistant Cub Scout Leader ACSL Altocumulus Standing Lenticular Clouds (often confused for UFOs) ") resolved to create and issue US$75,000,000 of MENs exchangeable for Ashanti Shares. The MENs are unsecured Unsecured A loan or equity interest that is given without any guarantee of payment, performance, satisfaction or opportunity for return from the recipient. No property, interest or security is used as collateral in either a guarantee or a pledge. and unconditional obligations of ACSL, as the issuer, and will be issued, credited as fully paid, in registered form, in amounts and integral multiples of US$1 principal amount. Ashanti undertakes to issue Ashanti Shares on the exchange of the MENs and to keep available at all times sufficient Ashanti Shares for such purpose. Ashanti has also undertaken to procure admission to listing on the Official List of the UKLA and admission to trading on the LSE and the GSE promptly after exchange of the MENs. Ashanti has agreed, following the earliest to occur of the repayment of the Enlarged RCF, a takeover offer for Ashanti becoming unconditional (or a scheme of arrangement proposed by Ashanti becoming effective) (a "Takeover Event"), the exchange of the MENs and 29 June 2008, to procure that ACSL meets its obligations pursuant to the MENs Deed Poll. The MENs are exchangeable into Ashanti Shares on either of the following events: (a) the completion of the first rights issue by Ashanti undertaken following the date of the Deed Poll; or (b) Ashanti serving a notice of exchange upon the holders of the MENs at any time after the date falling 18 months after the issue of the MENs. The MENs are exchangeable into Ashanti Shares at an exchange price of the lower of US$5.40and the price at which Ashanti issues Ashanti Shares pursuant to the Proposed Rights Issue. Ashanti has undertaken that the subscription price of the Proposed Rights Issue shall not exceed US$5.40. Fractions of Ashanti Shares will not be issued on exchange and no cash adjustment will be made in respect thereof. The portion of the principal amount of a MEN as corresponds to any fraction of an Ashanti Share not issued as described above shall accrue To increase; to augment; to come to by way of increase; to be added as an increase, profit, or damage. Acquired; falling due; made or executed; matured; occurred; received; vested; was created; was incurred. to the benefit of ACSL, as the issuer. The MENs will be redeemable for cash on the earlier of: (a) a Takeover Event; or (b) the date of maturity, being 30 June 2008. In the event that (and only if) the MENs are so redeemed, interest on the MENs is payable at the same margin rate as is payable under the Enlarged RCF. In the event that Ashanti pays a dividend at any time prior to exchange of the MENs into Ashanti Shares, interest will be payable at the time (and only if) such exchange occurs, equal to the amount which the holders of MENs would have received had their MENs been exchanged at an exchange price of US$5.40 on the dividend record date. Otherwise the MENs are non-interest bearing. The MENs are, subject to certain conditions, transferable, but no application is intended to be made for the MENs to be listed or dealt in on any stock exchange. The MENs have not been registered under the Securities Act or the securities laws of any State of the United States and may not be offered, sold, delivered, assigned as·sign tr.v. as·signed, as·sign·ing, as·signs 1. To set apart for a particular purpose; designate: assigned a day for the inspection. 2. , exchanged or otherwise disposed dis·pose v. dis·posed, dis·pos·ing, dis·pos·es v.tr. 1. To place or set in a particular order; arrange. 2. of, directly or indirectly, in the United States or to or for the account or benefit of US Persons. MENs Subscription Agreements Lonmin MENs Subscription Agreement The Lonmin MENs Subscription Agreement was entered into on 27 June 2002 between Ashanti, ACSL and Lonmin. Pursuant to this agreement, Lonmin has subscribed for US$46,569,305 of MENs and ACSL has issued the US$46,569,305 of MENs to Lonmin. Ashanti has undertaken to use its best efforts to complete the Proposed Rights Issue within 18 months from the issue date of the MENs and to ensure that the size of the Proposed Rights Issue is such that Lonmin would be entitled to subscribe for such number of Ashanti Shares under the Proposed Rights Issue which is equal to or greater than the number of Ashanti Shares which would be issued on exchange of US$46,569,305 of MENs. Lonmin has undertaken not to take up its rights under the Proposed Rights Issue unless and only to the extent that the Ashanti Shares offered to it in connection with the Proposed Rights Issue exceeds the number of Ashanti Shares that would be issued upon exchange of US$46,569,305 of MENs. Ashanti has further undertaken that, in the event that the Proposed Rights Issue is not completed within 18 months from the issue date of the MENs, it will: (a) within 20 business days after the end of such 18 month period, despatch a notice of extraordinary general meeting to its shareholders to consider resolutions to approve the exchange of any MENs (whether or not held by Lonmin) in accordance with the voluntary exchange provisions of the MENs Deed Poll, and to procure that such meeting is convened within 60 days of such 18 month period; (b) procure that its Directors (other than those who are also directors of Lonmin) recommend shareholders to vote in favour of such resolution (subject to each Director's fiduciary fiduciary (fĭd  `shēĕ'rē), in law, a person who is obliged to discharge faithfully a responsibility of trust toward another. duties as he understands them upon appropriate Ghanaian legal advice) and, if they so recommend, to also cast their own votes in favour of such resolution; and (c) to solicit proxies (where shareholders beneficially hold one per cent or more of the total issued share capital of Ashanti) to be returned before the deadline appointed for such meeting, for so long as the recommendation of the Directors to vote in favour of the resolution remains current. Ashanti has no obligation under the undertakings in (a) to (c) to the extent that any of them shall cause Ashanti or any of its Directors to be in breach of any rule or regulation of the LSE (including the Listing Rules of the United Kingdom Listing Authority), the New York Stock Exchange New York Stock Exchange (NYSE) World's largest marketplace for securities. The exchange began as an informal meeting of 24 men in 1792 on what is now Wall Street in New York City. or the GSE or to be in breach of their fiduciary duties Noun 1. fiduciary duty - the legal duty of a fiduciary to act in the best interests of the beneficiary legal duty - acts which the law requires be done or forborne , any US securities rules or any rule of law. Ashanti has also undertaken to Lonmin that it shall not, without Lonmin's prior written consent, not to be unreasonably withheld or delayed: (a) issue any Ashanti Shares by way of capitalisation n. 1. same as capitalization. Noun 1. capitalisation - writing in capital letters capitalization writing - letters or symbols that are written or imprinted on a surface to represent the sounds or words of a language; "he turned the paper of profits or reserves or bonus issue or sub-divide or consolidate or reclassify Verb 1. reclassify - classify anew, change the previous classification; "The zoologists had to reclassify the mollusks after they found new species" class, classify, sort out, assort, sort, separate - arrange or order by classes or categories; "How would you any Ashanti Shares; (b) issue any new class of share in the capital of Ashanti; or (c) redeem redeem v. to buy back, as when an owner who had mortgaged his/her real property pays off the debt. The term also refers to paying the amount due and all charges after a foreclosure (due to failure to make payments when due) has begun. or purchase any Ashanti Share or reduce its share capital, capital redemption reserve or share premium account. Ashanti further undertakes to Lonmin that it will, within 30 days of the passing of the resolution to exchange the MENs, serve notice under the Deed Poll to effect such exchange. If such resolution is not passed, Ashanti shall not be entitled to serve any such notice, except with the prior written consent of Lonmin. Ashanti also undertakes that it shall not, without the prior approval of a special resolution of its shareholders, issue more than 11,000,000 Ashanti Shares other than pro rata [Latin, Proportionately.] A phrase that describes a division made according to a certain rate, percentage, or share. In a Bankruptcy case, when the debtor is insolvent, creditors generally agree to accept a pro rata share of what is owed to them. to its shareholders. Lonmin has also given undertakings to Ashanti that it shall not lend, sell, transfer or otherwise dispose of dis·pose v. dis·posed, dis·pos·ing, dis·pos·es v.tr. 1. To place or set in a particular order; arrange. 2. or deal with or charge, encumber To burden property by way of a charge that must be removed before ownership is free and clear. Property subject to an encumbrance may have a lien or mortgage imposed upon it. or grant options or other rights over: (a) US$46,569,305 of MENs (except with the prior consent of Ashanti and ACSL or as is permitted in connection with the transfer of its existing ordinary shares (see (b) below); (b) its existing holding of 36,000,000 Ashanti Shares, provided that a sale of any or all of Lonmin's existing shares is permitted if Lonmin also sells the same proportion of MENs to the same buyer or if it receives confirmation from the UKLA that, as a result of such sale, shareholder approval for exchange of its MENs is not required (in either case, any buyer must enter into a deed containing certain restrictions relating to related party issues and US securities law). Lonmin is also entitled to sell its existing shareholding pursuant to a recommended offer for the entire issued share capital of Ashanti; (c) any MENs issued to Lonmin or Ashanti Shares issued upon exchange of such MENs unless in compliance with certain US securities requirements. Lonmin also undertakes that it will not exercise its voting rights Voting rights The right to vote on matters that are put to a vote of security holders. For example the right to vote for directors. voting rights The type of voting and the amount of control held by the owners of a class of stock. in respect of shares held by Lonmin and its concert parties in excess of 50 per cent of the entire issued share capital of Ashanti from time to time, except following a change of control of Ashanti which has been approved by the Minister of Mines under the Minerals and Mining Law 1986 of Ghana (as amended a·mend v. a·mend·ed, a·mend·ing, a·mends v.tr. 1. To change for the better; improve: amended the earlier proposal so as to make it more comprehensive. 2. ) or is in compliance with the provisions of the Takeover Code of Ghana. Lonmin has also agreed to vote in favour of resolutions necessary to implement the Rights Issue, including resolutions to increase the authorised share capital of Ashanti and the Directors' authorisation to allot al·lot tr.v. al·lot·ted, al·lot·ting, al·lots 1. To parcel out; distribute or apportion: allotting land to homesteaders; allot blame. 2. Ashanti Shares. Ashanti has entered into a separate letter of undertaking with Lonmin pursuant to which it has agreed that, for so long as any of the Put Options remain to be exercised, if it seeks to effect the Proposed Rights Issue at less than US$5.40 per share, it shall not, without Lonmin's approval (acting reasonably), launch such Rights Issue at a subscription price of more than a 5% discount to the then current market value of an Ashanti Share Government of Ghana MENs Subscription Agreement The Government MENs Subscription Agreement was entered into on 27 June 2002 between Ashanti, ACSL, Lonmin and the Government. Pursuant to this agreement, ACSL offered the Government the right to subscribe for US$28,430,695 of MENs. The Government transferred this subscription right to Lonmin in consideration for Lonmin entering into the Call Option Agreement. Lonmin subscribed for the US$28,430,695 of MENs and ACSL issued such MENs to Lonmin. Ashanti has undertaken to the Government to use its best efforts to complete the Proposed Rights Issue within 18 months from the issue date of the MENs and to ensure that the size of the Proposed Rights Issue is such that the Government would be entitled to subscribe for such number of Ordinary Shares under the Proposed Rights Issue which is equal to or greater than the number of Ordinary Shares which would be issued on exchange of US$28,430,695 of the MENs. If the Proposed Rights Issue is not completed within this period, the Government has irrevocably ir·rev·o·ca·ble adj. Impossible to retract or revoke: an irrevocable decision. ir·rev undertaken to Lonmin to vote in favour of any resolution proposed by Ashanti seeking independent shareholder approval to enable the exercise of Ashanti's option under the Deed Poll to exchange all of the MENs. The Government has undertaken not to take up its rights under the Proposed Rights Issue unless and only to the extent that the Ordinary Shares offered to it in connection with the Proposed Rights Issue exceeds the number of Ordinary Shares that would be issued upon exchange of US$28,430,695 of MENs. Ashanti has further undertaken to the Government that it shall not, without the Government's prior written consent, such consent not to be unreasonably withheld or delayed: (a) issue any Ordinary Shares by way of capitalisation of profits or reserves or bonus issue or sub-divide or consolidate or reclassify any Ordinary Shares; (b) issue any new class of share in the capital of Ashanti; or (c) redeem or purchase any ordinary share or reduce its share capital, capital redemption reserve or share premium account. Lonmin has agreed that it will not transfer, charge or encumber its interest in US$28,430,695 of the MENs other than in accordance with the terms of the Call Option Agreement or otherwise with Ashanti or ACSL's prior consent. Lonmin and the Government have also agreed not to amend the Call Option Agreement unless such amendment would not (in the reasonable opinion of Ashanti) result in Ashanti breaching any relevant US securities legislation or result in an issue of Ashanti Shares upon exchange of the US$28,430,695 MENs where such issue would require the approval of shareholders. The Government has also given undertakings to Ashanti and ACSL that it shall not lend, sell, transfer or otherwise dispose of or deal with, charge, encumber or grant options or other rights over: (a) its rights under the Call Option, unless in compliance with relevant US securities requirements; (b) its existing holding of 21,978,104 Ashanti Shares prior to the record date for the Proposed Rights Issue, except with the consent of Ashanti and ACSL or by way of acceptance of an offer for the entire issued share capital of Ashanti; or (c) any Ashanti Shares into which any of the MENs are exchanged unless in accordance with relevant US securities requirements. The Government has further agreed to vote in favour of any resolutions required to implement the Proposed Rights Issue, including resolutions to increase the authorised share capital of Ashanti and the Directors' authorisation to allot Ashanti Shares. Government of Ghana/ Lonmin Call Option Agreement The Call Option Agreement dated 27 June 2002 was entered into between Lonmin and the Government. Pursuant to the Call Option Agreement the Government has the right to call for Lonmin to transfer the Ashanti Shares into which US$28,430,695 of MENs are exchangeable upon the completion of the Proposed Rights Issue. The purchase price of the Ashanti Shares under the Call Option Agreement is the price at which the Ashanti Shares are offered for subscription pursuant to the Proposed Rights Issue. The Call Option is exercisable at any time during the period ending on the earlier of (a) the anniversary of 18 months of the date of the Call Option Agreement and (b) five business days prior to the close of the subscription period of the Proposed Rights Issue. The Ashanti Shares which are the subject of the Call Option may, however, only be delivered and paid for upon the closing date of the subscription period of the Proposed Rights Issue. The Government's rights under the Call Option Agreement are capable of assignment in whole or in part or transfer or mortgage or charge to any person provided that such transfer or disposal is in accordance with US securities laws and evidence is produced by the Government to Ashanti and Lonmin that such sale and transfer was in compliance with such laws. The Government has also undertaken to vote in favour of the resolution agreed to be proposed by Ashanti in the event the Proposed Rights Issue is not completed within 18 months to enable all the MENs to be exchanged. Enlarged RCF On 27 June 2002 Ashanti entered into a US$200,000,000 revolving credit facility to replace the US$100 million revolving credit facility which was entered in to on 15 May 2002 with a group of 14 syndicate Syndicate organized crime unit throughout major cities of the United States. [Am. Hist.: NCE, 2018] See : Gangsterism lenders ("Lenders"). The Enlarged RCF, was conditional, amongst other things, on the completion of the Cash Redemption Alternative. It will be repaid in eight semi-annual instalments each of US$20,000,000 commencing in 12 months (from today - the date of the first drawdown Drawdown The peak to trough decline during a specific record period of an investment or fund. It is usually quoted as the percentage between the peak to the trough. Notes: ) with a further final instalment of US$40,000,000. The term of the loan is five years. The interest rate applicable to the Enlarged RCF increases over the life of the loan. The interest rate is as follows: (a) Years 1 and 2 - US LIBOR plus 1.75 per cent.; and (b) Years 3, 4 and 5 - US LIBOR plus 2.00 per cent. The Enlarged RCF was provided to the Ashanti Group through its subsidiary Ashanti Finance (Cayman) Limited (the "Borrower") to pay and refinance Refinance 1. When a business or person revises their payment schedule for repaying debt. 2. Replacing an older loan with a new loan offering better terms. Notes: When a business refinances they typically extend the maturity date. the Existing Notes and US$270,000,000 revolving credit facility dated 3 December 1998 (as amended and restated) between, amongst others, the Borrower and several financial institutions (the "Existing RCF") and for general corporate purposes. Key points of the Enlarged RCF - cross default in respect of financial indebtedness of material group members (excluding certain subsidiaries, such as Kimin and ring fenced project finance entities) in excess of US$5 million; - insolvency of material group members; - nationalisation of certain assets of the Ashanti Group; - reduction of foreign exchange retention levels; - termination of the margin free trading arrangements other than in accordance with the terms of the Interim Margin Free Trading Letter, or the New Margin Free Trading Letter (as the case may be) and termination of hedging agreements without the consent of Ashanti and its risk management committee; and - change of control of Ashanti which is reasonably likely to have a material adverse effect. (a) Years 1 and 2 payable at - 0.75 per cent. on available but undrawn un·draw tr.v. un·drew , un·drawn , un·draw·ing, un·draws To draw to one side, as a curtain. Adj. 1. undrawn - not represented in a drawing undelineated - not represented accurately or precisely amounts; and (b) Years 3, 4 and 5 payable - 0.90 per cent. on available but undrawn amounts. - The Enlarged RCF imposes terms and conditions on the Ashanti Group which are substantially the same as those in the US$100 million revolving credit facility entered into on 15 May 2002. The Events of Default include - cross default in respect of financial indebtedness of material group members (excluding certain subsidiaries, such as Kimin and ring fenced project finance entities) in excess of US$5 million; - insolvency of material group members; - nationalisation of certain assets of the Ashanti Group; - reduction of foreign exchange retention levels; - termination of the margin free trading arrangements other than in accordance with the terms of the Interim Margin Free Trading Letter, or the New Margin Free Trading Letter (as the case may be) and termination of hedging agreements without the consent of Ashanti and its risk management committee; and - change of control of Ashanti which is reasonably likely to have a material adverse effect. -------- 1 The figure for total issued share capital after the Cash Redemption Alternative assumes the exercise of 13,810,440 Warrants but does not take account of other possible increases in share capital for instance share options and further Warrant exercise. Assumes Rights Issue at a price of US$5.40. 2 This is prior to the Rights Issue and exchange of the MENs and any exercise under the Put Option. 3 This assumes no exercise of the Call Option by the Government or any third party. 4 Lonmin would have this same shareholding if the Rights Issue did not go ahead but instead the shares are issued following a related party shareholder approval. 5 The Put Options are exercisable in tranches of approximately 5 million shares on three exercise dates being 28 April 2004, 28 October 2004 and 28 April 2005. 6 This assumes that the Call Option is exercised in full by the Government and that the Put Options are not exercised. If the Call Option is exercised by anyone other than the Government then the Government's shareholding would remain constant at 21,978,104 shares. This press release does not constitute an offer to sell or the solicitation of an offer to buy nor shall there be any sale or distribution of securities in any such jurisdiction in which such offer, sale or distribution is not permitted. |
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