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Central Asia Metals PLC Proposed acquisition of -79-

22 Sep 2017 6:01 am

Bank borrowings from Ohridska Banka represent short-term loans. The first loan was issued in amount of $5,307,885 with interest rate of 6.2% p.a. which matured on 30 June 2017 has been repaid. The second loan was issued in amount of $525,948 with interest rate of 4.5% p.a. and has a maturity date on 5 September 2017. The third loan was approved in amount of $1,051,707 with interest rate of 4.5% p.a. maturing on 30 November 2017. For the six month period ending 30 June 2017 there have been repayments of borrowings.

The carrying amounts and fair value of all borrowings are as follows:
 
                                                             Carrying amount                 Fair value 
                                                      -----------------------------  ------------------------- 
                                                        30 June                        30 June     31 December 
                                                          2017     31 December 2016      2017          2016 
                                                      -----------                    -----------  ------------ 
 Ohridska Banka 
  AD 
  Skopje............................................ 
  .                                                     5,182,275        18,324,040    5,182,275    18,324,040 
 SG 
  Facility.......................................... 
  ..................................                   66,486,949        73,000,000   66,486,949    73,000,000 
                                                      -----------  ----------------  -----------  ------------ 
                                                       71,669,224        91,324,040   71,669,224    91,324,040 
                                                      ===========  ================  ===========  ============ 
 

The fair value of all borrowings equals their carrying amount, as the impact of discounting is not significant. The information in relation to the pledge of collateral is presented in Note 10.

The carrying amounts of the borrowings are denominated in the following currencies:
 
                                                                                             30 June     31 December 
                                                                                               2017          2016 
                                                                                           -----------  ------------ 
 MKD.................................................................................... 
  ....................................................................................... 
  ..................                                                                         5,182,275    18,324,040 
 USD.................................................................................... 
  ....................................................................................... 
  ...................                                                                       66,486,949    73,000,000 
                                                                                            71,669,224    91,324,040 
                                                                                           -----------  ------------ 
 
   18.       Related party transactions 

The Lynx Group has related party transactions with subsidiaries of its parent company during its normal course of business activities. All transactions with related parties are conducted under normal trading and commercial terms at mutually agreed terms. The tables below provide information for the volume and balances of the related party transactions as of and for the period ended 30 June 2017, 30 June 2016 and year ended 31 December 2016.
   (i)         Year-end balances arising from purchases/sales of commodities and services 
 
                                                                                             30 June     31 December 
                                                                                               2017          2016 
                                                                                          ------------  ------------ 
 Receivables from related parties 
  Subsidiaries of the ultimate beneficiaries 
  of the Lynx 
  Group................................................................................. 
  ......                                                                                    17,409,357     3,690,147 
                                                                                            17,409,357     3,690,147 
                                                                                          ------------  ------------ 
 
   (ii)        Sales of commodities and services 
 
                                                                                             30 June       30 June 
                                                                                               2017          2016 
                                                                                          ------------  ------------ 
 Sales towards Lynx Metals 
  Subsidiaries of the ultimate beneficiaries 
  of the Lynx 
  Group................................................................................. 
  ......                                                                                    54,084,815    35,644,648 
 Sales of                                                                                    2,054,166             - 
 silver................................................................................. 
 ....................................................................................... 
 ..... 
 Marketing 
  cost.................................................................................. 
  ...................................................................................... 
  ...                                                                                      (1,373,143)   (4,085,191) 
                                                                                            54,765,838    31,559,457 
                                                                                          ------------  ------------ 
 
   (iii)       Services obtained 
 
                                                                                                30 June     30 June 
                                                                                                  2017        2016 
                                                                                              ----------  ---------- 
 Services obtained from Fusion Capital 
  - shareholder of Lync Resources...........................................................   1,802,500   1,500,000 
                                                                                              ----------  ---------- 
                                                                                               1,802,500   1,500,000 
                                                                                              ----------  ---------- 
 
 
                                                                                              30 June      30 June 
                                                                                                2017         2016 
                                                                                            -----------  ----------- 
 Services obtained from Lynx Metails 
  Marketing 
  cost.................................................................................... 
  .......................................................................................     1,373,143    4,085,191 
                                                                                            -----------  ----------- 
                                                                                              1,373,143    4,085,191 
                                                                                            -----------  ----------- 
 
   (iv)       Deferred revenue 

Please refer to note 15 for details of deferred revenue recognized in relation to the Silver Purchase Agreement with Lynx Metals.
   19.       Commitments 

The Lynx Group has signed long-term contracts to either support its standard operational activity (production materials, oil, explosives, etc.) or develop new projects. In the latter category, the Lynx Group is currently committed to the construction of facilities for the appropriate treatment of "tailings" and has engaged one main contractor for the related construction work; the total value of all standing commitments after 30 June 2017 is approximately $840,000.
   20.       Contingencies 

Legal proceedings

From time to time and in the normal course of the business, claims against the Lynx Group may be received. On the basis of its own estimates and both internal and external professional advice, the Management of the Lynx Group is of the opinion that no material losses will be incurred in respect of claims and accordingly no provision has been made in this consolidated financial information.
   21.       Events after the reporting period 

On 22 September 2017, it was announced that CAML will, subject to the satisfactory completion of certain conditions, acquire the entire issued share capital of Lynx Resources Limited.

There are no events after the reporting period that would have impact on the 30 June 2017 condensed consolidated interim statement of comprehensive income, condensed consolidated interim statement of financial position, condensed consolidated interim statement of cash flows.
   27.           Unaudited Pro Forma Statement of Net Assets of the Enlarged Group 

The unaudited pro forma financial information of the Enlarged Group in this section 27 has been prepared to illustrate the effect on the net assets of CAML as if the Acquisition, the Debt Financing and the Company Placing had taken place on 30 June 2017.

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September 22, 2017 02:01 ET (06:01 GMT)

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