KMR Kenmare Resources Plc

 
TIDMKMR 
 
 
   Kenmare Resources plc ("Kenmare" or "the Company") 
 
   1 August 2014 
 
   Debt Financing Update 
 
   Kenmare Resources (LSE: KMR, ISE: KMR), one of the leading producers of 
titanium minerals, is pleased to announce that it has agreed an 
amendment to the project financing terms for the Moma Mine in Mozambique, 
as well as an extension to the corporate loan provided by Absa Bank 
Limited ("Absa"), a member of Barclays. 
 
   The project financing amendment removes the requirement to make 
scheduled principal payments of Senior Debt and payments of interest and 
principal of Subordinated Debt falling due in August 2014, February 2015 
and August 2015. Instead, project lenders will receive payments under a 
cash sweep dependent on the level of cash generation at the mine. 
Simultaneously, Kenmare has agreed with Absa an extension to Absa's 
US$20 million corporate loan, which will now mature on 31 March 2016. 
 
   Managing Director Michael Carvill commented: "We are pleased to have 
concluded this agreement with the project lenders and Absa which will 
enable us to conserve cash and provide greater flexibility during the 
current period of low product prices." 
 
   The principal amendments to the project financing are as follows: 
 
 
   -- Principal repayments of Senior Debt and principal repayments and interest 
      due in respect of Subordinated Debt that in each case fall due on the 1 
      August, 2014, 1 February, 2015 and 1 August, 2015 payment dates will now 
      be paid only to the extent the Kenmare group cash balance exceeds US$80 
      million in accordance with a cash sweep mechanism. 
 
   -- To the extent scheduled amounts are not paid on the due dates under this 
      cash sweep mechanism, the balances would then be payable on the earlier 
      of the next payment date (to the extent payable under the cash sweep) and 
      the Deferral Amount Payment Date. 
 
   -- The Deferral Amount Payment Date is the earlier of 31 December 2015 and 
      30 days after a change of control of Kenmare. 
 
 
   In addition, Absa has agreed that the repayment date for the US$20 
million loan provided to Kenmare will be extended from the current date 
of 31 March 2015 to 31 March 2016. The terms of the extension provide 
that the loan is repayable upon a change of control of Kenmare. 
 
   In return for this increased flexibility, Kenmare and the Project 
Companies have agreed, amongst other things, to provide information to 
project lenders in greater detail and on a more frequent basis, and to 
meet the costs of providing the lenders with legal and other 
professional advisers.  In addition, the Project Companies are required 
to deliver a budget for 2015 to the lenders by 31 January 2015. This 
budget must show the Project Companies meeting their debts as they fall 
due and be approved by the lenders, acting reasonably, failing which an 
Event of Default would ensue. 
 
   The Kenmare group has also agreed to the payment of fees as follows: 
 
 
   -- In addition to fees payable to providers of political and commercial risk 
      insurance, guarantees to certain of the project lenders and payment of 
      reimbursable expenses, work fees of US$300,000 will be payable to the 
      project lenders, half of which will be payable to Senior Lenders and half 
      to Subordinated Lenders. 
 
   -- An extension fee equivalent to 4% (US$800,000) of the principal amount 
      will be payable to Absa in relation to the Absa Facility. It is expected 
      that this fee will be settled through the issuance of warrants for 
      Kenmare shares, unless these cannot be issued for regulatory reasons. The 
      warrants will not be issued before 1 September, 2014 and will have an 
      exercise price equal to the market price at the time of issue. The 
      warrants will be exercisable for a period of seven years and will 
      otherwise be on substantially the same terms as the warrants issued on 16 
      October 2013 in connection with Kenmare's placing at that time. 
 
 
   Kenmare group cash balances amounted to $37.3 million and the aggregate 
group debt was $349.6 million at the 30 June 2014. 
 
   Kenmare's Half-Yearly Report is scheduled for release on 27 August 2014. 
 
   For further information, please contact: 
 
   Kenmare Resources plc 
 
   Michael Carvill, Managing Director 
 
   Tel: +353 1 671 0411 
 
   Mob: + 353 87 674 0110 
 
   Tony McCluskey, Financial Director 
 
   Tel: +353 1 671 0411 
 
   Mob: + 353 87 674 0346 
 
   Jeremy Dibb, Corporate Development & Investor Relations Manager 
 
   Tel: +353 1 671 0411 
 
   Mob: +353 87 943 0367 
 
   Murray Consultants 
 
   Joe Heron / Jim Milton 
 
   Tel: +353 1 498 0300 
 
   Buchanan 
 
   Bobby Morse / Louise Mason / Gordon Poole 
 
   Tel: +44 207 466 5000 
 
   Note: Kenmare Moma Mining (Mauritius) Limited and Kenmare Moma 
Processing (Mauritius) Limited are wholly owned subsidiaries of Kenmare 
Resources plc and collectively referred to herein as "the Project 
Companies".  The "Kenmare group" includes Kenmare Resources plc and its 
subsidiaries. 
 
   The Directors of Kenmare accept responsibility for the information 
contained in this announcement. To the best of their knowledge and 
belief (having taken all reasonable care to ensure that such is the 
case), the information contained in this announcement is in accordance 
with the facts and does not omit anything likely to affect the import of 
such information. 
 
   This announcement is not intended to, and does not, constitute or form 
part of any offer, invitation or the solicitation of an offer to 
purchase, otherwise acquire, subscribe for, sell or otherwise dispose of, 
any securities whether pursuant to this announcement or otherwise. The 
distribution of this announcement in jurisdictions outside Ireland or 
the United Kingdom may be restricted by law and therefore persons into 
whose possession this announcement comes should inform themselves about, 
and observe, such restrictions. Any failure to comply with the 
restrictions may constitute a violation of the securities law of any 
such jurisdiction. 
 
   This announcement is distributed by NASDAQ OMX Corporate Solutions on 
behalf of NASDAQ OMX Corporate Solutions clients. 
 
   The issuer of this announcement warrants that they are solely 
responsible for the content, accuracy and originality of the information 
contained therein. 
 
   Source: Kenmare Resources via Globenewswire 
 
   HUG#1845582 
 
 
  http://www.kenmareresources.com/ 
 

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