The information contained within this announcement is deemed by the Company to constitute inside information as stipulated under the Market Abuse Regulations (EU) No. 596/2014 (MAR) as in force in the United Kingdom pursuant to the European Union (Withdrawal) Act 2018. Upon the publication of this announcement via Regulatory Information Service (RIS), this inside information will be in the public domain

19 March 2024                                                                                                                                                                          

Andrada Mining Limited

("Andrada" or the "Company")

Funding Agreement

Andrada Mining Limited (AIM: ATM, OTCQB: ATMTF), the African technology metals mining company with a portfolio of mining and exploration assets in Namibia is pleased to announce that its subsidiary Uis Tin Mining Company (Pty) Ltd ("UTMC"), has today entered a conditional, credit-approved NAD 175 million (approximately GBP7.3m) funding agreement with Bank Windhoek Limited ("BWL"). If completed, these facilities will replace UTMC's current banking facilities of NAD111.3million (see announcement dated 26 November 2021) and BWL will also provide all main transactional banking services to UTMC in Namibia. 

Highlights

§ Headline terms of a NAD 175million (approximately GBP 7.3million) senior secured long-term loan and associated short term and working capital facilities (together the "Lending Facilities") have been agreed with BWL.

§ The intention is that the Lending Facilities will replace UTMC's current banking facilities.

§ The proceeds from the Facilities will be primarily allocated to working capital, strategic growth initiatives, and the retirement of existing facilities. Details on the use of funds are set out below.

Anthony Viljoen, Chief Executive Officer, commented:

"We are excited to partner with a respected Namibian owned financial institution like Bank of Windhoek. This comprehensive agreement aligns perfectly with Andrada's current and future funding needs. The increased cash flow should empower us to execute key operational decisions. Notably, the improved working capital facility will better support our production increases year on year. We look forward to executing final documentation and entering into a collaborative relationship as we achieve our ambitious growth plans."

Rationale for the Proposed New Funding

As set out above, the Directors consider the proposed terms from BWL offer more favourable terms than current facilities and consider that the lower monthly payment and longer repayment term will unlock greater cash for the Company. Furthermore, BWL has indicated its interest in funding the construction of a 5MW solar plant at Uis. Although, this is still at an early stage, the directors consider this support for the Company's wider objectives as indicative of a successful, collaborative future relationship.

Summary of the Terms

The Company has agreed a conditional term sheet for a NAD 100 million (approximately GBP 4.2 million) Term Loan with BWL and the headline terms include the following:

§ Loan term of 6 years.

§ Ranked as senior secured debt, pari passu with other senior secured debt holders.

§ Interest accrues at Namibian Prime lending rate ("Prime Rate") currently 11.50%, plus 1% (a rate of 12.5% per annum). However, a mechanism is in place to mitigate the impact of the Prime Rate decreases on the facility's interest rate. This ensures the facility rate remains materially unchanged.

§ It is intended that there will be no capital repayments for the initial 12 months from the date of drawdown.

In addition, the intention is that BWL will refinance the Company's working capital facilities totalling NAD 50 million (approximately GBP 2.1 million). These facilities, which are for 12 months from the date of drawdown, will incur the Prime rate minus 0.5%, resulting in a total rate of 11%. However, a mechanism is in place to mitigate the impact of the Prime Rate decreases on the facility's interest rate. This ensures the facility rate remains materially unchanged. It is intended that these working capital facilities will be ranked as senior secured debt pari passu with other senior secured debt holders.

Finally, as part of the Lending Facilities, the Company has also agreed headline terms for short-term loan facilities of NAD 15 million (approximately GBP 0.63 million) for use as cashflow against future VAT payments ("Short Term Loan"). It is intended that the Short-Term Loan will be provided for 12 months and will incur the Prime rate. Any drawdowns under the Short-Term Loan will be repaid to the bank upon receipt of refunds from Namibia Revenue Agency

In addition to the Lending Facilities, the intention is that BWL will provide AfriTin Mining (Namibia) Pty Limited with a NAD 10 million (approximately GBP 0.42 million) guarantee to Namibia Power Corporation Pty Limited in relation to a deposit for the right to supply electrical power, which will incur a small fee payable at six monthly intervals.

Any final agreement on the Lending Facilities is subject to legal opinions, receipt of relevant licences, approvals, and consents, as well as the negotiation and execution of all applicable documentation. At this stage there can be no guarantee the Lending Facilities will be entered into but the Directors and BWL have every confidence the agreement will be concluded. A further announcement will be made when the documents are executed, but in any event an announcement will be made before 19 April 2024 when these credit terms expire.

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About Andrada Mining Limited

Andrada Mining Limited, is a London-listed technology metals mining company with a vision to create a portfolio of globally significant, conflict-free, production and exploration assets. The Company's flagship asset is the Uis Mine in Namibia, formerly the world's largest hard-rock open cast tin mine.

An exploration drilling programme is currently underway with the aim of expanding the tin resource over the fourteen additional, historically mined pegmatites that occur within a 5 km radius of the current processing plant. The Company has set a mineral resource target of 200 Mt to be delineated within the next 5 years. The existing mine, together with its substantial mineral resource potential, allows the Company to consider economies of scale.

Andrada mining is managed by a board of directors with deep industry knowledge and a management team with extensive commercial and technical skills. Furthermore, the Company is committed to the sustainable development of its operations and the growth of its business. This is demonstrated by the way the leadership team places significant emphasis on creating value for the wider community, investors, and other key stakeholders. Andrada has established an environmental, social and governance system that has been implemented at all levels of the Company and aligns with international standards.