4th Jul 2016 10:24
LONDON (Alliance News) - Premier African Minerals Ltd Monday said George Roach, the chief executive and president of the company, has agreed to provide a guarantee over the funds owed to the contractor which will carry out operations at the open pit within the RHA tungsten project.
The miner signed a memorandum of understanding last year with JR Goddard Contracting (Pvt) Ltd, the contractor for the open pit mining at the Zimbabwe project, and Roach has now agreed to guarantee the sums owed to the contractor.
Premier African agreed to terminate its deal with JR Goddard after moving into underground operations at the project rather than focusing on the open pit operation.
Premier African Minerals said the current outstanding amount owed to JR Goddard is around USD851,312, and the current arrangement is that Premier African Minerals will repay that amount in monthly instalments of USD54,626 over a 20-month period.
The terms state that Premier African Minerals would be able to recover USD247,000 by way of equal monthly payments against JR Goddard's mining certificates if the company is able to recommence open pit operations through its engagement with JR Goddard over that 20-month period.
On Monday, Premier African Minerals said it has entered into a put option agreement over its holding in Circum Minerals Ltd with Roach.
Under the terms of that agreement, Roach will be required to purchase a number of shares held in Circum priced at USD2 each - equal to the amount owed to JR Goddard.
Importantly, that will only be required if Premier African Minerals either failed to meet its obligations under the agreement with JR Goddard, if JR Goddard exercises its rights against Roach or of Premier African Minerals fails to find an alternative buyer for its Circum shares.
Premier African shares were down 2.5% to 0.683 pence per share on Monday morning.
By Joshua Warner; [email protected]; @JoshAlliance
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