Settlement of claim from Taurus Funds Management

RNS Number : 4335N

Hummingbird Resources PLC

24 September 2019

 

Hummingbird Resources plc / Ticker: HUM / Index: AIM / Sector: Mining

24 September 2019

Hummingbird Resources plc

Settlement of claim from Taurus Funds Management

Hummingbird Resources (AIM:HUM) has agreed to settle a claim from Taurus Funds Management Pty Ltd ("Taurus") for US$2.5m. The value of the claim was in excess of US$10m.

As previously announced, in April 2017 Hummingbird terminated a Mandate with Taurus to arrange a project finance facility (the 'Mandate'), and subsequently repaid the then outstanding bridge loan, remaining interest and associated due diligence costs.  Hummingbird terminated the Mandate, in accordance with the termination clause, due to a lack of confidence in the necessary funding being made available by Taurus on a timely basis or on terms acceptable to Hummingbird.

Following the termination of the Mandate, Hummingbird entered into a loan agreement with Coris Bank, who provided the necessary funding to enable the Yanfolila Project ("the Project") to be completed on time and budget.

Subsequently in January 2018, after having received full repayment of amounts due and releasing security held, Taurus filed a claim in the English courts for the loss of the potential facility fee and royalty which may have been payable had the project finance loan agreement been entered into.

Whilst maintaining the position that no breach of the Mandate occurred, the Board of Hummingbird has assessed settlement on a number of criteria that sought to limit shareholder risk.  Recognising that all litigation carries a risk of unexpected results; that even if a defence is successful not all costs are recoverable, coupled with the prospect of a rapidly increasing legal bill between now and trial; and that ongoing litigation is a significant distraction for a small management team, it was deemed prudent by the Board to reach a settlement if possible. 

The settlement sum is payable 50 percent on or before 3 October 2019 and 50 percent on or before 31 March 2020. The Company believes this is the most responsible course of action to eliminate risk on behalf of shareholders and other stakeholders.

As it is near to the end of Q3 2019 the Company is pleased to report that production to date for the quarter has been encouraging and we remain in line to meet 2019 annual production guidance of 110-125,000ozs of gold.  With the second ball mill fully commissioned the Company is seeing increased throughput capacity at the plant with improving economies of scale.  The Company expects to release its Q3 2019 operational update before the end of October 2019. 

**ENDS**

For further information please visit www.hummingbirdresources.co.uk or contact: 

Daniel Betts, CEO Thomas Hill, FD Robert Monro, IR	Hummingbird Resources plc	Tel: [phone]
James Spinney Ritchie Balmer James Bellman	Strand Hanson Limited Nominated Adviser	Tel: [phone]
James Asensio	Canaccord Genuity Limited Broker	Tel: [phone]
Gordon Poole Owen Roberts Ollie Head	Camarco Financial PR/IR	Tel: [phone]

Notes to Editors:

Hummingbird Resources (AIM: HUM) is a leading gold production, development and exploration company.  The Company has two core gold projects, the Yanfolila Gold Mine in Mali and the Dugbe Gold Project in Liberia.  Yanfolila produced its first gold pour on time and budget in December 2017.  Yanfolila held pre-production Probable Reserves of 710,535ozs @ 3.14g/t, total Resources of 1.8Mozs of gold and an additional 390,700ozs of non-compliant exploration potential.  The Dugbe Gold Project has Resources currently totalling 4.2Mozs of gold and a completed NI 43-101 compliant PEA on the project showing a 29% IRR and US$186m NPV at a US$1,300 gold price.

In addition to Hummingbird's production and development assets, the Company also has an exploration footprint of ~4,000km2 and an interest in AIM-listed Cora Gold, which is advancing a portfolio of prospects in Mali and Senegal.

 

END

 

 

MSCLIFVDAEISFIA