Sundance Resources (ASX: SDL) has provided its activities report for the quarter ended 31 December.
New AustSino, Noteholder Agreement now unconditionally extended to 30 June 2020
Cameroon Government visits China
Sundance shares remain in voluntary suspension
$158,000 cash on hand as at 31 December 2019
As announced on 8 July 2019, Sundance Resources Ltd (“Sundance”) (ASX: SDL), AustSino Resources Group Ltd (“AustSino”) (ASX: ANS) and the Noteholders of Sundance (“Noteholders”) entered into an agreement dated 5 July 2019, which regulates the terms on which AustSino would invest in Sundance and the existing notes held by the Noteholders would be cancelled in exchange for a cash, share and option package (“Sundance Agreement”).
The end date for completion of the Sundance Agreement was 31 December 2019. On 22 October 2019 Sundance announced a letter agreement wassigned between Sundance and AustSino in which Sundance agreed to extend the end date for completion of the Sundance Agreement to 30 June 2020 (“SDL Letter Agreement”).
In addition to this extension:
The existing financial support arrangement in the Sundance Agreement will continue until completion. AustSino will continue to pay $100,000 per month to Sundance in return for the issue of ordinary shares in Sundance at an issue price of $0.0045 per share (which would comprise total payments of $1.3 million if completion does not occur until 30 June 2020).
AustSino will now pay an additional $200,000 per month to Sundance starting on 1 December 2019 in return for the issue of ordinary shares in Sundance at an issue price of $0.0045 per share. However, the shares will not be issued to AustSino unless and until completion occurs (which would comprise total additional payments of $1.4 million to Sundance if completion does not occur until 30 June 2020).
Sundance and AustSino have agreed to release each other (and their relevant personnel) from any claims or liabilities arising under or in connection with the Second Placement Agreement or the Mbalam-Nabeba Project prior to 22 October 2019 (the date of the SDL Letter Agreement).
The additional funds to be received from AustSino will be used for general working capital purposes and to progress discussions regarding the Mbalam-Nabeba Iron Ore Project.
These changes were conditional on:
written agreement of Sundance’s Noteholders to the SDL Letter Agreement by 31 December 2019; and
AustSino and Western Australian Port Rail Construction (Shanghai) Ltd (WAPRC), being parties to an agreement dated on or about 24 September 2018 pursuant to which WAPRC will subscribe for shares in the Investor for $100 million (WAPRC Agreement), agreeing to extend the deadline for completing all conditions precedent under the WAPRC Agreement from 31 December 2019 to 30 June 2020.
Written agreement was received by the Sundance Noteholders to the SDL Letter Agreement on 2 December 2019. AustSino has informed Sundance that WAPRC has also extended their WAPRC Agreement to 30 June 2020.
Separately, as consideration for Sundance agreeing to extend the end date to completion of the Sundance Agreement, AustSino agreed to issue approximately 107,692,308 fully paid ordinary AustSino shares to Sundance at a deemed issue price of $0.013 per share but at no cost to Sundance.
AustSino announced on 24 December 2019 that these shares have been issued to Sundance. Sundance and AustSino expect that the Sundance Agreement will be concluded before 30 June 2020 with a current target date for the required Extraordinary General Meeting (“EGM”) to be held late March or April 2020.