Sundance Resources Limited (ASX: SDL) has provided the following market update on the Agreement with AustSino Resources and the noteholders in Sundance as announced on 8 July 2019 and later updated with a letter agreement announced on 22 October 2019.
AustSino announced on 3 June 2020 the placement agreement between AustSino and Western Australian Port Rail Construction (Shanghai) Ltd (“WAPRC”) had been delayed and that, as a result, AustSino would not satisfy the conditions precedent in the WAPRC Agreement by 30 June 2020.
As per Sundance’s announcement on 25 June 2020 AustSino said it had identified a new investor to replace WAPRC, however, because of the uncertainties created by the late change and the then pending expiry of the Sundance Agreement, Sundance adjourned the extraordinary general meeting it had called for 29 June 2020.
The Sundance Agreement expired on 30 June 2020.
On 2 July 2020, Sundance announced it was in negotiations with AustSino with a view to agreeing a further extension to the Sundance Agreement.
Sundance is pleased to announce that its negotiations with AustSino have progressed to the signing of a new extension letter agreement between AustSino and Sundance to extend the Sundance Agreement to 30 September 2020 (“Further Extension Letter”). This Further Extension Letter is now being circulated among the Noteholders for their execution by 17 July 2020 in order for the further extension to be effective.
The Further Extension Letter has a number of conditions:
The Agreement is extended to 30 September 2020 subject to:
by July 10 AustSino must lodge a draft Notice of Meeting to the Australian Securities Exchange for review; and
by July 17 AustSino needs to demonstrate to the reasonable satisfaction of Sundance that they have progressed the funding (e.g. $29M) for completion of the Sundance Agreement.
AustSino will provide a further $450K in funding to Sundance (this will be repayable in cash or equity only if the Sundance Agreement completes otherwise it will be revenue to Sundance). The first payment is $50K and is payable on 17 July should (i) all Noteholders have consented to the further extension, and (ii) AustSino have satisfied the conditions in (a) and (b) above.
This Further Extension Letter and the key dates in it permits Sundance to take further action and allows Sundance to seek an alternative course if sufficient progress to our satisfaction is not achieved.
The Sundance shareholders’ Extraordinary General Meeting, which was adjourned on 29 June 2020, is now expected to be reconvened before the end of July 2020 if AustSino satisfies the requirements of the Further Extension Letter. Shareholders will be kept advised with regards to the reconvened meeting.