REG - Goldstone Resources - Proposed Subscription & Share Consolidation <Origin Href="QuoteRef">GRL.L</Origin>

Goldstone ResourcesAnnouncement

06/09/2014 18:34

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RNS Number : 8012M
Goldstone Resources Ltd
21 July 2014 
 
21 July 2014 
 
GOLDSTONE RESOURCES LIMITED 
 
("GoldStone" or the "Company") 
 
Conditional Subscription by Stratex International plc 
 
& Proposed Share Consolidation 
 
GoldStone (AIM: GRL), the AIM quoted exploration company focused on gold in
West and Central Africa, is pleased to announce a proposed subscription for
shares by Stratex International Plc ("Stratex") to raise gross proceeds of
£1.25 million (the "Subscription").  The Subscription will occur after the
proposed 1 for 10 consolidation (the "Share Consolidation") of the Company's
existing ordinary shares of 1 penny ("Ordinary Shares") into new ordinary
shares of 1 penny ("New Ordinary Shares") and will be for 20,833,333 New
Ordinary Shares (the "Subscription Shares") at a price of 6 pence per share
(the "Subscription Price"). 
 
The Subscription Shares would, following the Share Consolidation and the
Subscription represent approximately 33.5% of the enlarged issued share
capital of the Company.  The Subscription Price, with adjustment for the Share
Consolidation, represents a discount of approximately 3% to the volume
weighted average price over the 20 trading days ended 18 July 2014. 
 
Jurie Wessels, CEO of GoldStone commented as follows: 
 
"The forging of an alliance with Stratex not only delivers funding at a
critical time to advance GoldStone's attractive projects, but also leads to
GoldStone gaining an experienced and well-funded shareholder with a proven
track record of turning small to medium sized gold assets into cash generating
enterprises.  By becoming a major shareholder and gaining a significant
presence at board level, Stratex shows commitment to unlock the synergies
offered by both companies' resources." 
 
Principal Terms of the conditional Subscription 
 
Under the terms of the subscription agreement entered into between inter alia
the Company and Stratex (the 'Subscription Agreement'), Stratex will subscribe
for the Subscription Shares at the Subscription Price, conditional, inter
alia, upon: 
 
-  admission of the Subscription Shares to trading on AIM ("Admission")
becoming effective on or before 30 September 2014 or such later date as the
Company and Stratex may agree, being not later than 31 October 2014 (the 'Long
Stop Date'); 
 
-  the issue of warrants to Stratex to subscribe for 20,833,333 New Ordinary
Shares at a price of 7 pence per share for a period of 18 months from the date
of Admission; 
 
-  the granting of a waiver by the Panel on Takeovers and Mergers of the
obligation to make a general offer for the Company that would otherwise arise
under Rule 9 of the City Code on Takeovers and Mergers as a result of the
Subscription by Stratex (the 'Waiver'); 
 
-  the approval by the shareholders of the Company in a general meeting of the
Share Consolidation, the Waiver and the Subscription Shares; 
 
-  the appointment to the board of Directors of the Company (which is to
include no more than five directors in total) of two non-executive directors
nominated by Stratex, one of whom shall serve as chairman and one independent
director also nominated by Stratex; and 
 
-  the approval by Stratex of terms of employment and incentive arrangements
of certain Directors and employees of the Company. 
 
Unity Mining Limited, which holds 29.5% of the Company's issued share capital,
has undertaken to vote in favour of the resolutions to be proposed at the
general meeting to approve, inter alia, the Subscription and the Waiver. 
 
In the event that such conditions are not satisfied, or waived by Stratex
where capable of waiver, or become incapable of fulfilment, before the Long
Stop Date, the Subscription Agreement will terminate.  The Subscription
Agreement may be terminated by Stratex prior to completion in certain
circumstances, including if the warranties given to Stratex by the Company in
the Subscription Agreement were not true or accurate, or were misleading when
given or are breached before Admission, or if prior to Admission there occurs
an event or omission which materially and adversely affects the financial
position and/or prospects of the Company or which, in the reasonable and
proper opinion of Stratex, is or may be materially prejudicial to the Company
or the Placing. 
 
Principal Terms of the proposed Share Consolidation 
 
Under the Share Consolidation it is proposed that every ten Ordinary Shares of
1 penny will be consolidated into one New Ordinary Share and one new deferred
share of 9 pence.  The new class of deferred shares shall have no voting
rights, no rights to dividends and negligible rights on a return of capital.
The deferred shares will not be admitted to trading on AIM. 
 
The Board believes that the Share Consolidation will result in a more
appropriate number of shares in issue for a company of Goldstone's size in the
UK market.  The Share Consolidation may also help to make the company's shares
more attractive to investors and may result in a narrowing of the bid/offer
spread, thereby improving liquidity. 
 
Following the Share Consolidation, Shareholders will hold the same proportion
of the Company's ordinary share capital as before the Share Consolidation
(save in respect of fractional entitlements).  Other than a change in nominal
value, the New Ordinary Shares will carry equivalent rights to the Ordinary
Shares. 
 
The Share Consolidation will be subject to the approval of shareholders in a
general meeting. 
 
General Meeting 
 
In order to satisfy the conditions of the Subscription Agreement and approve
the Share Consolidation, the Waiver and the Subscription, it is intended that
a circular convening a general meeting of shareholders will be sent to
shareholders in due course and a further announcement made at that time. 
 
Enquiries: 
 
GoldStone Resources Limited      +27 (21) 913 0388 
 
Jurie Wessels 
 
WH Ireland Limited               +44 (0) 207 220 1666 
 
Tim Feather 
 
Nick Field 
 
- ends - 
 
Notes To Editors 
 
About Stratex International plc 
 
Stratex is an AIM-quoted exploration and development company focused on gold
and high-value base-metal deposits.  Stratex is active in Turkey, East and
West Africa and reportedly discovered more than 2.2 million ounces of gold and
7.9 million ounces of silver.  Stratex has a record of forming joint-venture
partnerships with private companies who operates in the respective countries
of operation and with major international mining companies, including
Antofagasta, Centerra and Teck in Turkey, and Thani Ashanti in East Africa.
Stratex has relationships with AngloGold Ashanti, Teck, BlackRock Investment
Management and with Investment and Exploration Capital Partners 2012 Limited
Partnership, a Sprott Asset Management fund. 
 
For more information about Stratex, please visit
www.stratexinternational.com. 
 
This information is provided by RNS
The company news service from the London Stock Exchange