Placing of Shares, Convertible Facility and Open Offer
(Thomson Reuters ONE) - For immediate release 10 November 2009 Serabi Mining Plc ("Serabi" or the "Company") Placing of 139,867,833 new Ordinary Shares £300,000 Convertible facility Proposed open offer to raise £300,000Highlights * Placing and Convertible facility to raise in total £2.398 million. * £300,000 open offer enables existing shareholders to participate on the same terms as the placing. * Funding will be used to undertake follow-up exploration around Palito.Mike Hodgson, Chief Executive, commented:"We are delighted to have completed this financing. The proceeds willbe used to enhance the Palito project by investigating and evaluatinga series of anomalies which have already been identified by theCompany. I am confident that these funds will enable the Company tomake further discoveries which will ultimately lead to an increase inits geological resource base through the investigation of the widerpotential around Palito and provide shareholders with the potentialfor future growth of the business after what has been a difficultyear. I am also pleased to welcome our new strategic investor GreenwoodInvestments and Mr Christopher Kingsman and the Company is veryappreciative of the support received from existing and newinstitutional investors. The open offer enables our smallershareholders to participate in the Company's financing."Enquiries:Serabi Mining plcClive Line, Finance Director Tel: 020 7246 6830 Mobile: 07710 151 692Website: www.serabimining.comBeaumont Cornish Limited (Nominated Adviser)Roland Cornish / Michael Cornish Tel: 020 7628 3396Farm Street CommunicationsSimon Robinson Tel: 07593 340 107 10 November 2009 Serabi Mining Plc ("Serabi" or the "Company") Placing of 139,867,833 new Ordinary Shares £300,000 Convertible facility Proposed Open Offer to raise £300,0001. IntroductionThe Board of Serabi is pleased to announce that the Company has todayplaced 139,867,833 New Ordinary Shares at a price of 1.5 per OrdinaryShare (the "Placing Price") to raise £2,098,017 (before expenses)(the "Placing"). In addition, the Company has arranged an unsecured£300,000 convertible loan facility (the "Convertible"), convertibleinto up to 20,000,000 New Ordinary Shares at the Placing Price. Theproceeds of the Placing and the Convertible will in aggregate raisegross proceeds of ?£2,398,017 (before expenses) which will be used tofund the Company's next stage of exploration at the Palito mine.The Board also intends to raise up to £300,000 (before expenses) byway of an open offer to be made to eligible shareholders of up to20,000,000 New Ordinary Shares at the Placing Price. The open offerwill not be underwritten and a circular will be sent to shareholdersas soon as practicable.2. Background to and reasons for the Placing, Convertible and theOpen OfferFollowing the decision to suspend the underground mining operation atPalito towards the end of 2008, the Directors have considered avariety of options to introduce new capital into the Group's projectsand in particular the Palito mine. A number of contributing factorsled to the failure to maintain necessary rates of mine developmentand ultimately, in the absence of sufficient working capital tofinance this development, the need to suspend underground miningoperations. The Directors have, however, concluded that even if thenecessary finance could be raised it would, having placed theunderground mine on care and maintenance, be the wrong strategy topursue a near term re-establishment of underground mining at thePalito mine. The Directors are of the opinion that whilst theybelieve that the current Palito mine can be operated profitably,ultimately the long term value will be derived from the discovery anddevelopment of an enlarged reserve base which would support a miningand processing operation capable of producing at least 70,000 goldequivalent ounces per annum.In January 2008, the Group commissioned a 6,000 hectare helicopterborne geophysical survey over and around the Palito mine. The fullindependent interpretation and evaluation of the results of thissurvey was completed in September 2008. The gold mineralisation atPalito is hosted within sulphide ore bodies which are conductors.The survey identified 66 anomalous areas where conductivity readingswere greater than those of the surrounding area. Orientationreadings were obtained by taking measurements over the Palito mineitself. Interpretation of the anomalous readings and correlationwith other exploration data held by the Group has resulted in theprioritisation of 18 specific targets.The Directors believe that the general geological characteristicsaround Palito, the existence of past garimpeiro activity in the areaof the survey and the hydrothermal nature of the Palito deposititself, are indicative that the Palito deposit is unlikely to be theonly occurrence of gold mineralisation within the surveyed area.They therefore feel that evaluation through further exploration ofthe 18 prioritised anomalies provides an excellent opportunity toidentify the Board's target of two to three Palito "look-a-likes".Assuming that each of these would be of a similar size to Palito,such an outcome could support a total reserve (including Palito) ofup to 500,000 to 600,000 gold equivalent ounces and an additionalresource of up to 1.2 million gold equivalent ounces.The first stage of exploration will focus on conducting a variety ofgeophysical and geochemical analyses over the anomalies to improvethe geological understanding of each of these. The Group anticipatesthat if the results of these initial studies are suitably encouragingthe programme could result in 7-10 targets being advanced to adrill-ready status during the next 12 months and it plans to conductan initial small scale drill programme over three of these targetsduring this time. Subject to results, the Group intends over thefollowing year to drill the remaining drill-ready targets and inaddition, undertake further geophysical and geochemical analysis toadvance the remaining anomalies to a drill-ready status. Thisprogramme would require additional capital to be raised of a similaramount to the Placing, at that time. Should two to three Palito"look-a-likes" be identified by this process, subsequent furtherin-fill drilling would be undertaken together with initial minedevelopment and on-lode exploration to establish formal reserves andresources required for any bankable feasibility study. The Groupanticipates that with an estimated cost of US$4-$5 million to bringthe Palito deposit back into production, a further US$8-$10 millionfor the development cost of two additional deposits and an allowanceof US$4-5 million for plant expansion and upgrades, the future coststo reach full scale production could be between US$16 million andUS$20 million.Based on such an enlarged resource, the Directors consider that a newoperation whereby the Group has three concurrent but discrete minesin close proximity each at production rates of circa 25,000 goldequivalent ounces per annum feeding a central processing plant, wouldprovide the best opportunity to develop the Palito area into aninteresting and profitable operation, generating cash flow to supportthe Group's future exploration needs.The Group has during 2009 operated Palito as a small scale surfacemining operation focussed on the near surface oxide ore zones. Therevenues from this operation have to date helped to minimise theworking capital needs of the Group when taken in conjunction withsignificant cost reduction measures that have been taken. However,in the long term, the development and exploration at Palito asoutlined above requires additional capital.3. Details of the PlacingThe Company has today conditionally placed 139,867,833 New OrdinaryShares at the Placing Price with selected institutional and privateinvestors to raise £2,098,017 (before expenses). Application will bemade for the New Ordinary Shares, which will rank pari passu with theExisting Ordinary Shares, to be admitted to trading on AIM andtrading is expected to commence on 18 November 2009. The Placing isconditional on the Placing Shares being admitted to trading on AIM.As part of the Placing, Greenwood Investments Limited ("Greenwood")has subscribed for 81,384,000 Placing Shares at the Placing Price.Greenwood is a private company incorporated in England and Wales, ofwhich the controlling shareholder and sole director is Mr ChristopherKingsman. Mr Kingsman who has an existing beneficial interest in theExisting Ordinary Shares of Serabi worked as an analyst and fundmanager in London from 1998 to 2005 and currently manages a familyoffice based in Munich, Germany.On completion of the Placing, Greenwood and Mr Kingsman together willbe interested in approximately 29.35 per cent. of the Enlarged ShareCapital of Serabi. If any person (or group of persons acting inconcert) acquire an interest in securities (as defined in the CityCode on Takeovers and Mergers (the "Takeover Code")) which, takentogether with shares in which he and persons acting in concert areinterested, carry 30 per cent. or more of the voting rights of acompany, that person or those persons may be required by Rule 9 ofthe Takeover Code to make a general offer to all of the shareholdersto acquire the remaining issued share capital. Greenwood did not wishto subscribe for Ordinary Shares as part of the Placing which would(together with any person with whom it is acting in concert) haveincreased its interest in securities to or above such 30%threshold.Accordingly, in addition to its subscription under the Placing,Greenwood entered into a convertible loan agreement with the Company("Convertible") under which Greenwood has made available a facilityof £300,000 to the Company. The full amount of the Convertible isconvertible at the election of Greenwood into New Ordinary Shares atthe Placing Price at any time on or before 31 October 2014. A maximumof 20,000,000 New Ordinary Shares may be issued on conversion of theConvertible. The Convertible is unsecured and will pay a coupon ofone per cent. per annum and, unless otherwise converted, will berepaid on 31 October 2014.Greenwood has entered into an orderly market agreement with theCompany and Beaumont Cornish, in which Greenwood has agreed that itwill not dispose of any Ordinary Shares for a period of one yearfollowing admission, subject to certain exemptions as set out inAppendix II below.The Company has also agreed that, for as long as Greenwood isinterested in Ordinary Shares representing 15 per cent. or more ofthe entire issued share capital of Serabi from time to time,Greenwood shall have the right to nominate a director to the Board ofthe Company.The Company intends to use the proceeds of the Placing and theConvertible to commence the first stage of exploration and furtherevaluation of the 18 prioritised anomalies identified within thesurveyed area together with further oxide resource definition(expected to amount in aggregate to approximately US$1.7 million inthe first year) as well as to fund the general working capitalrequirements of the Group including new project development.4. Open OfferThe Company considers it important that, where reasonablypracticable, Shareholders have an opportunity to participate in thefundraising on equivalent terms and conditions to the Placing. TheBoard also intends to raise up to £300,000 (before expenses) by wayof an open offer to be made to eligible shareholders of up to20,000,000 New Ordinary Shares at the Placing Price. The open offerwill not be underwritten and a circular will be sent to shareholdersas soon as practicable. A further announcement will be madeconcerning the timetable for the open offer when the circular isposted to shareholders.5. Additional issue of sharesThe Company has also issued today 5,054,551 New Ordinary Shares tocertain suppliers and consultants in satisfaction of outstandingliabilities of £77,503. Application will be made for these NewOrdinary Shares, which will rank pari passu with the ExistingOrdinary Shares, to be admitted to trading on AIM which is expectedto commence on 18 November 2009.In addition, the Company intends to issue New Ordinary Shares to theDirectors in settlement of accrued but unpaid remuneration andbenefits under the terms of their existing service contractsamounting to £95,917 at the Placing Price.Pursuant to the Placing, the Company has issued Adviser Warrants toBeaumont Cornish Limited, the Company's Nominated Adviser and broker,to subscribe for up to 1,550,000 new Ordinary Shares at the PlacingPrice.Enquiries:Serabi Mining plcClive Line, Finance Director Tel: 020 7246 6830 Mobile: 07710 151 692Website: www.serabimining.comBeaumont Cornish Limited (Nominated Adviser)Roland Cornish / Michael Cornish Tel: 020 7628 3396Farm Street CommunicationsSimon Robinson Tel: 07593 340 107Qualified Person's Statement:The technical information contained within this announcement has beenreviewed and verified by Michael Hodgson as required by the AIMGuidance Note on Mining, Oil and Gas Companies dated June 2009.Michael Hodgson is an Economic Geologist by training with 20 yearsexperience in the mining industry. He has a BSc (Hons) Geology,University of London, an MSc Mining Geology, University of Leicesterand is a Fellow of Institute of Materials, Minerals and Mining and aChartered Engineer of the Engineering Council of UK. Appendix I RISK FACTORSALL THE INFORMATION SET OUT IN THIS ANNOUNCEMENT SHOULD BE CAREFULLYCONSIDERED, IN PARTICULAR THE ATTENTION OF PROSPECTIVE INVESTORS ANDSHAREHOLDERS IS DRAWN TO THE RISKS DESCRIBED BELOW. THE ORDINARYSHARES SHOULD BE REGARDED AS A SPECULATIVE INVESTMENT AND ANINVESTMENT IN ORDINARY SHARES SHOULD ONLY BE MADE BY THOSE WITH THENECESSARY EXPERTISE TO FULLY EVALUATE THE INVESTMENT.INVESTMENTS MAY FALL AS WELL AS RISE IN VALUE. THE DIRECTORS BELIEVETHAT THE FOLLOWING RISKS SHOULD BE CONSIDERED CAREFULLY BY INVESTORSBEFORE ACQUIRING ORDINARY SHARES. PROSPECTIVE INVESTORS ARE ADVISEDTO CONSULT AN INDEPENDENT ADVISER AUTHORISED UNDER FSMA.IF ANY OF THE FOLLOWING RISKS ACTUALLY MATERIALISE, THE GROUP'SBUSINESS, FINANCIAL CONDITION, AND PROSPECTS COULD BE MATERIALLY ANDADVERSELY AFFECTED TO THE DETRIMENT OF THE COMPANY AND ITSSHAREHOLDERS. IN THAT CASE, THE MARKET PRICE AND LIQUIDITY OFORDINARY SHARES COULD DECLINE AND ALL OR PART OF AN INVESTMENT IN THEORDINARY SHARES COULD BE LOST.THE DIRECTORS CONSIDER THE FOLLOWING RISKS TO BE MATERIAL. THE RISKSSET OUT BELOW DO NOT NECESSARILY COMPRISE ALL THOSE ASSOCIATED WITHAN INVESTMENT IN THE COMPANY AND THE ORDINARY SHARES. THERE MAY BEADDITIONAL RISKS THAT THE DIRECTORS DO NOT CURRENTLY CONSIDER TO BEMATERIAL OR OF WHICH THE DIRECTORS ARE NOT CURRENTLY AWARE. NOINFERENCE OUGHT TO BE DRAWN AS TO THE RELATIVE IMPORTANCE, OR THELIKELIHOOD OF THE OCCURRENCE, OF ANY OF THE FOLLOWING RISKS BYREFERENCE TO THE ORDER IN WHICH THEY APPEAR.RISKS SPECIFIC TO THE GROUPExploration and development riskThe Company is engaged in the exploration of mineral properties, aninherently risky business, and there is no assurance that aneconomically viable mineral deposit will be discovered. Mostexploration projects do not result in the discovery or development ofcommercially mineable ore deposits. A significant amount of thePlacing proceeds will be used towards exploration in evaluating the18 anomalies identified. However, there is a risk that noeconomically viable mineral deposits will be found.Reserve and resource estimatesThe estimation of mineral resources and reserves is in part aninterpretative process and the accuracy of any such estimates is afunction of the quality of available data, and of engineering andgeological interpretation and judgement. No assurances can be giventhat the volume and grade of reserves recovered, and rates ofproduction achieved, will not be less than anticipated. The Companycontracts the services of independent professional experts to prepareresource and reserve estimates.Political riskPolitical risk is the risk that assets will be lost throughexpropriation, unrest or war. Brazil, the only country in which theGroup has operations, currently has a stable political system withestablished fiscal and mining codes and a respect for the rule of lawbut there can be no guarantee that the Group will not be adverselyaffected by political risk. Elections are due in 2010 and thecurrent president will not be eligible for a further term which maylead to a period of change and political uncertainty. The countryhas however enjoyed strong economic growth and for this reason it isconsidered unlikely that political change will seek to put this atrisk by making significant changes that would make the country lessattractive for foreign investment.Surface Oxide riskWhilst oxide mining operation continues at this time, insufficientore sources have been identified to date to allow any estimation orindication of the expected life or future production levels of goldfrom this mining activity. Exploration to identify additional oxideore sources are on-going. Mining of the oxide ore may be suspendedat any time if there is insufficient mineable material identified tomaintain the viability of this operation.Commodity riskCommodity risk is the risk that the price earned for minerals willfall to a point where it becomes uneconomic to extract them from theground. The principal metals in Serabi's portfolio are gold, copperand silver. The prices of these metals are affected by numerousfactors beyond the control of the Company, including producer hedgingactivities, demand, political and economic conditions and productionlevels. During 2008, the price of certain commodities includingcopper fell significantly on world markets. Future commodity pricesmay go down as well as up.Liquidity riskLiquidity risk is the risk of running out of working and investmentcapital. Serabi's goal is to finance its exploration activities withcash flow from operations, but in the absence of such cash flow, theGroup relies on the issue of equity share capital, joint venture andoption agreements to finance its activities. There can be noassurance that adequate funding will be available when required tofinance the Group's activities.Currency riskFluctuations in currency exchange risks can significantly impact cashflows. The Group finances its overseas operations by transferring USdollars from the UK to meet local operating costs in its Braziliansubsidiary. The Group currently receives income from gold sales inBrazilian Reais although the price at which these sales arecalculated is made by reference to world market prices which arequoted in US dollars. Any income of the Group may become subject toexchange control or similar restrictions.Because the primary market for the Ordinary Shares and the underlyingbusiness of the Company are in a currency other than Euro, investorsfrom countries whose currency is the Euro are reminded that changesin exchange rates may also have an adverse effect on the value, priceor income of the Ordinary Shares.Changes in legislationExploration and production activities are subject to local laws andregulations governing prospecting, development, production, exports,taxes, labour standards, occupational health and safety, mine safetyand other matters. Such laws and regulations are subject to changeand can become more stringent, and compliance can therefore becomemore costly.Environmental protectionThe Group's exploration, development and production activities aresubject to extensive laws and regulations governing environmentalprotection. The Group is also subject to various reclamation-relatedrequirements.A failure to comply with environmental laws and regulations mayresult in enforcement actions causing operations to cease or becurtailed, the imposition of fines and penalties, and may includecorrective measures requiring significant capital expenditures. Inaddition, certain types of operations require the submission andapproval of environmental impact assessments.Title to mineral propertiesWhile the Company has undertaken all the customary due diligence inthe verification of title to its mineral properties, this should notbe construed as a guarantee of title. The properties may be subjectto prior unregistered agreements or transfers and title may beaffected by undetected defects.RISKS RELATING TO THE COMPANY'S SHARESValue of Ordinary Shares and liquidityIt is likely that the Company's share price will fluctuate and maynot always accurately reflect the underlying value of the Group'sbusiness and assets. The price of the Ordinary Shares may go down aswell as up and investors may realise less than the original suminvested. The price that investors may realise for their holdings ofOrdinary Shares, if and when they are able to do so, may beinfluenced by a large number of factors, some of which are specificto the Group and others of which are extraneous. Such factors mayinclude the possibility that the market for the Ordinary Shares isless liquid than for other equity securities and that the price ofthe Ordinary Shares is relatively volatile.The Directors are unable to predict when and if substantial numbersof Ordinary Shares will be sold in the open market. Any such sales,or the perception that such sales might occur, could result in amaterial adverse effect on the market price of the Ordinary Shares.DividendsThere can be no assurance as to the level of future dividends. Thedeclaration, payment and amount of any future dividends of theCompany are subject to the discretion of the Shareholders or, in thecase of interim dividends, to the discretion of the Directors, andwill depend upon, among other things, the Group's earnings, financialposition, cash requirements, availability of profits, as well asrelevant laws or generally accepted accounting principles from timeto time. For the time being the Company does not pay dividends andthis is unlikely to change in the near future.SuitabilityAn investment in the Company involves a high degree of risk and maynot be suitable for all investors.Investors are reminded that the price at which they may realise theirOrdinary Shares and the timing of any disposal of them may beinfluenced by a large number of factors, some specific to the Groupand its proposed operations, some which may affect the sector inwhich the Group operates and some which relate to the operation offinancial markets generally. These factors could include theperformance of the Group's operations, large purchases or sales ofshares in the Company, liquidity or absence of liquidity in theOrdinary Shares, legislative or regulatory changes relating to thebusiness of the Group and general economic conditions.GENERAL RISKSFinancial markets and global economic outlookThe performance of the Group will be influenced by global economicconditions and, in particular the conditions prevailing in the UnitedKingdom and Brazil. The global economy has been experiencingdifficulties during 2008 and 2009, with the natural resources sector,in particular, being affected from the autumn of 2008 onwards. Thefinancial markets have deteriorated dramatically in this period. Thishas led to unprecedented levels of illiquidity, resulting in thedevelopment of significant problems at a number of the world'slargest banks and insurance companies and considerable downwardpressure and volatility in share prices. In addition, recessionaryconditions are present in the United Kingdom, as well as in othercountries around the world.If these levels of market disruption and volatility continue, worsenor abate and then recur, the Company is likely to experiencedifficulty in securing debt finance, if required, to fund its longterm development strategy. The Group may be exposed to increasedcounterparty risk as a result of business failures in the countriesin which it operates and will continue to be exposed ifcounterparties fail or are unable to meet their obligations to theGroup. The precise nature of all the risks and uncertainties theGroup faces as a result of the current global financial crisis andglobal economic outlook cannot be predicted and many of these risksare outside of the Group's control.Changes in tax and other legislationThe information in this announcement is based upon current tax andother legislation and any changes in legislation or in the levels andbasis of, and reliefs from, taxation may affect the value of aninvestment in the Company. There can be no certainty that the currenttaxation regime in the UK and in Brazil where the Company operateswill remain in force or that the current levels of corporationtaxation will remain unchanged. There can be no assurance that therewill be no amendment to the existing taxation laws applicable to theGroup's operations, which may have a material adverse effect on thefinancial position of the Group. Individual tax circumstances maydiffer from investor to investor and persons acquiring OrdinaryShares are advised to seek tax advice based upon their personalcircumstances.Additional capital requirementsThe Group will require additional capital in the future, which maynot be available to it. Future financings to provide this capital maydilute Shareholders' proportionate ownership in the Company. TheCompany may raise capital in the future through public or privateequity financings or by raising debt securities convertible intoOrdinary Shares, or rights to acquire these securities. Any suchissues may exclude the pre-emption rights pertaining to the thenoutstanding shares. If the Company raises significant amounts ofcapital by these or other means, it could cause dilution for theCompany's existing Shareholders. Moreover, the further issue ofOrdinary Shares could have a negative impact on the trading price andincrease the volatility of the market price of the Ordinary Shares.The Company may also issue further Ordinary Shares, or create furtheroptions over Ordinary Shares, as part of its employee remunerationpolicy, which could in aggregate create a substantial dilution in thevalue of the Ordinary Shares and the proportion of the Company'sshare capital in which investors are interested.Forward looking statementsEvents in the past, or experience derived from these, or indeedpresent facts, beliefs or circumstances, or assumptions derived fromany of these, do not predetermine the future. Hopes, aims, targets,plans or intentions contained in this announcement are no more thanthat and should not be construed as forecasts.This announcement contains certain forward-looking statements thatare subject to certain risks and uncertainties, in particularstatements regarding the Group's plans, goals and prospects. Thesestatements and the assumptions that underpin them are based on thecurrent expectations of the Directors and are subject to a number offactors, many of which are beyond their control. As a result, therecan be no assurance that the actual performance of the Group will notdiffer materially from the matters described in this announcement.Admission to trading on AIMThe Existing Ordinary Shares are, and the New Ordinary Shares willbe, admitted to trading on AIM a market designed primarily foremerging or smaller companies to which a higher investment risk tendsto be attached than to larger or more established companies. TheOrdinary Shares will not be admitted to the Official List. Aninvestment in AIM quoted shares may carry a higher risk than aninvestment in shares quoted on the Official List.The investment described in this announcement is speculative and maynot be suitable for all recipients of this announcement. Potentialinvestors are accordingly advised to consult a person authorisedunder FSMA who specialises in advising in investments of this kindbefore making any investment decisions. A prospective investor shouldconsider carefully whether an investment in the Company is suitablein the light of his/her personal circumstances and the financialresources available to him/her. Appendix II Additional InformationThe undertaking by Greenwood not to dispose of any of its interest inSerabi for period of 12 months following the placing, shall not applyto a transfer of Ordinary Shares made:1.1 pursuant to:(a) an acceptance of a takeover offer for the entire issued sharecapital of Serabi (or such share capital other than any shares heldor acquired or contracted to be acquired by the offeror or by anyassociate of the offeror within the meaning of section 988 of theAct) recommended for acceptance by the Board (or, if applicable, theindependent Board members in relation to such takeover offer) orwhich has become unconditional as to acceptances;(b) a compromise or arrangement between Serabi and is creditors orany class of them or between Serabi and its members or any class ofthem which is agreed to by the creditors or members and sanctionedunder sections 895 to 901 of the Act or section 110 of the InsolvencyAct 1986;(c) any offer by Serabi to purchase its own Shares which is made onidentical terms to the holders of Shares of the same class andotherwise complies with the Act;(d) any disposal to a member of the same group of companies as thatof which the Investor is a member, provided that such transfereeenters into an undertaking in the same terms as hereof;1.2 in order to prevent Greenwood being required to make amandatory offer pursuant to Rule 9 of the Takeover Code; or1.3 on the sale by Greenwood of Shares arising on the exerciseof a right to subscribe such Shares under a Serabi open offer orrights issue, provided that (in any case):(a) such exercise is made by Greenwood in respect of a largernumber of Shares than those so sold;(b) the number sold is no more than is necessary to make suchexercise (taking into account such sale) a self-financing transactionfor ; and(c) the sale is made on or as soon as practicable after suchexercise. DEFINITIONS"Admission" admission of the New Ordinary Shares to trading on AIM becoming effective in accordance with the AIM Rules"AIM" a market operated by the London Stock Exchange"AIM Rules" the AIM Rules for Companies published by the London Stock Exchange as amended from time to time governing admission to, and the operation of, AIM"Beaumont Cornish" Beaumont Cornish Limited, the Company's nominated adviser and broker, a member of the London Stock Exchange and authorised and regulated by the Financial Services Authority"Company" or "Serabi" Serabi Mining Plc"Convertible" The unsecured £300,000 convertible loan facility, convertible into up to 20,000,000 New Ordinary Shares at the Placing Price"Directors" or the the directors of the Company, as at the date"Board" of this announcement"Disclosure and the Disclosure and Transparency Rules issuedTransparency Rules" by the FSA"Enlarged Share Capital" the 291,455,916 Ordinary Shares in issue on Admission, including the Placing Shares, the New Ordinary Shares to be issued to certain suppliers and consultants and any New Ordinary Shares issued to Directors in settlement of accrued but unpaid remuneration and benefits"Existing Ordinary the 140,139,065 Ordinary Shares of theShares" Company in issue at the date of this Document"FSA" the Financial Services Authority of the UK"FSMA" the Financial Services and Markets Act 2000 (as amended)"Greenwood" Greenwood Investments Limited, a company limited by shares registered in England and Wales with registered number 7057380 and a registered office at Lubbock Fine City Forum, 250 City Road, London EC1V 2QQ"Group" the Company and its subsidiaries"London Stock Exchange" London Stock Exchange plc"New Ordinary Shares" the Ordinary Shares in the Company to be issued pursuant to the Placing and the additional share issues described in the announcement"Ordinary Shares" ordinary shares of 0.5 pence each in the capital of the Company"Overseas Shareholders" Shareholders resident in, or citizens of, jurisdictions outside the United Kingdom"Placing" the conditional placing by the Company of the Placing Shares at the Placing Price"Placing Price" 1.5 pence per New Ordinary Share"Placing Shares" the 139,867,833 New Ordinary Shares to be issued pursuant to the Placing"Prospectus Rules" the rules made by the Financial Services Authority pursuant to sections 73A(1) and (4) of FSMA"RIS" Regulated Information Service"Shareholder" a holder of Ordinary Shares from time to time"UK" the United Kingdom of England, Scotland, Wales and Northern Ireland"UKLA" the Financial Services Authority acting in its capacity as the competent authority for the purposes of Part VI of FSMA"US", "USA" or "United the United States of America, each StateStates" thereof (including the District of Columbia), its territories, possessions and all areas subject to its jurisdiction GLOSSARY"On-Lode Exploration" exploration by the establishment of underground mineral development which follows the mineralised structure"Mineral Resource" a concentration or occurrence of material of intrinsic economic interest in or on the Earth's crust in such form, quality and quantity that there are reasonable prospects for eventual economic extraction. The location, quantity, grade, geological characteristics and continuity of a Mineral Resource are known, estimated or interpreted from specific geological evidence and knowledge. Mineral Resources are sub-divided, in order of increasing geological confidence, into Inferred, Indicated and Measured categories An Inferred Mineral Resource is that part of a Mineral Resource for which tonnage, grade and mineral content can be estimated with a low level of confidence. It is inferred from geological evidence and assumed but not verified geological and/or grade continuity. It is based on information gathered through appropriate techniques from locations such as outcrops, trenches, pits, workings and drill holes which may be limited or of uncertain quality and reliability. An Indicated Mineral Resource is that part of a Mineral Resource for which tonnage, densities, shape, physical characteristics, grade and mineral content can be estimated with a reasonable level of confidence. It is based on exploration, sampling and testing information gathered through appropriate techniques from locations such as outcrops, trenches, pits, workings and drill holes. The locations are too widely or inappropriately spaced to confirm geological and/or grade continuity but are spaced closely enough for continuity to be assumed. A Measured Mineral Resource is that part of a Mineral Resource for which tonnage, densities, shape, physical characteristics, grade and mineral content can be estimated with a high level of confidence. It is based on detailed and reliable exploration, sampling and testing information gathered through appropriate techniques from locations such as outcrops, trenches, pits, workings and drill holes. The locations are spaced closely enough to confirm geological and grade continuity"Ore Reserve" the economically mineable part of a Measured and/or Indicated Mineral Resource. It includes diluting materials and allowances for losses, which may occur when the material is mined. Appropriate assessments and studies have been carried out, and include consideration of and modification by realistically assumed mining, metallurgical, economic, marketing, legal, environmental, social and governmental factors. These assessments demonstrate at the time of reporting that extraction could reasonably be justified. Ore Reserves are sub-divided in order of increasing confidence into Probable Ore Reserves and Proved Ore Reserves. A Probable Ore Reserve is the economically mineable part of an Indicated, and in some circumstances, a Measured Mineral Resource. It includes diluting materials and allowances for losses which may occur when the material is mined. Appropriate assessments and studies have been carried out, and include consideration of and modification by realistically assumed mining, metallurgical, economic, marketing, legal, environmental, social and governmental factors. These assessments demonstrate at the time of reporting that extraction could reasonably be justified. A Proved Ore Reserve is the economically mineable part of a Measured Mineral Resource. It includes diluting materials and allowances for losses which may occur when the material is mined. Appropriate assessments and studies have been carried out, and include consideration of and modification by realistically assumed mining, metallurgical, economic, marketing, legal, environmental, social and governmental factors. These assessments demonstrate at the time of reporting that extraction could reasonably be justified"VTEM" Versa time domain electromagnetic - a particular type of electromagnetic geophysical survey to prospect for conductive bodies below surface.ENDS---END OF MESSAGE---This announcement was originally distributed by Hugin. The issuer is solely responsible for the content of this announcement.
Datum: 10.11.2009 - 08:00 Uhr
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