Central Rand Gold Limited
(Incorporated as a company with limited liability under the laws of Guernsey,
Company Number 45108)
(Incorporated as an external company with limited liability under the laws of South Africa,
Registration number 2007/019223/10)
LSE share code: CRND JSE share code: CRD
("Central Rand Gold" or the "Company")
Puno Funding Call Court Case Outcome
· Central Rand Gold wins dispute with Puno regarding funding call.
· The Company's subsidiaries, CRGSA and CRGNV, awarded ZAR72,326,573 (approximately US$924,791).
· The Company's subsidiaries, CRGSA and CRGNV, awarded all legal costs relating to the application, which is still to be determined as the Courts still need to tax the accounts.
Shareholders are referred to the announcement dated 28 November 2011 wherein a dispute relating to alleged procedural breaches of the Central Rand Gold South Africa Proprietary Limited ("CRGSA") Shareholders Agreement ("Shareholders Agreement"), entered into between Central Rand Gold Netherlands Antilles ("CRGNV") and its current Black Economic Empowerment partner, Puno Gold Investments Proprietary Limited ("Puno") was detailed. Shareholders are advised that on 13 June 2017, the High Court of South Africa, (Gauteng Division, Pretoria) ("the Court") handed down judgment under case number: 45200/2011, being the matter initiated by the Company, CRGNV and CRGSA against Puno on 25 November 2011.
This matter centred around the validity and enforceability of a funding call, being the request for funds from shareholders of CRGSA for operational use, made by CRGSA and CRGNV on Puno under the Shareholders Agreement between the parties relating to CRGSA. This funding call was issued on 17 September 2008 in terms of clause 11 of the Shareholders Agreement.
The judgment delivered was in favour of the Company, CRGNV and CRGSA. The Court upheld the views of these entities and rejected the defences proffered by Puno. This judgment has now definitively and positively pronounced on the validity and enforceability of the funding call, and found that such funding call was made in accordance with the overarching law and the Shareholders Agreement.
Although the consequent call option, being the call for dilution of the shareholding due to non-payment of outstanding loans, was not positively declared upon for other reasons, the Court provided an Order in favour of the Company, CRGNV and CRGSA as follows:
"1. [That] the funding call directed by the first and second applicant (CRGSA and CRGNV) to the respondent (Puno) on or about 17 September 2008, for payment by the respondent for ZAR72 326 573.47 is declared valid and enforceable.
2. The respondent is ordered to pay the costs of the application.
3. The counter-application is dismissed with costs.
4. Both cost orders include the costs of senior and junior counsel"
Puno retains interest in CRGSA but owes CRGSA and CRGNV ZAR72,326,573 (approximately US$924,791, being the original loan amount plus compound interest).
The Company is considering the options open to it in the light of the Order in its favour against Puno.
For further information, please contact:
Central Rand Gold +27 (0) 87 310 4400
ZAI Corporate Finance Ltd - Nominated Adviser & Broker +44 (0) 20 7060 2220
Brandon Hill Capital Limited - Broker +44 (0) 20 3463 5000
Jonathan Evans / Wei Jiao
Merchantec Capital - JSE Sponsor +27 (0) 11 325 6363
Monique Martinez / Marcel Goncalves
14 June 2017
The information communicated in this announcement is inside information for the purposes of Article 7 of Market Abuse Regulation 596/2014 ("MAR").
This information is provided by RNS