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Chingola, Copperbelt

About The Scheme

Please remember to download and read through all documentation provided in the link at the bottom of this page.

A Scheme of arrangement is a statutory procedure allowing a company to enter a compromise or arrangement with its creditors (or any class of them), which is provided for under section 46 of the Zambian Corporate Insolvency Act, No. 9 of 2017. The approval by Scheme Creditors of the proposed Scheme is essential in facilitating the successful implementation of the Scheme and achieving a fair and orderly resolution of the Company’s current financial position. It is the responsibility of the Scheme Administrator as the agent of the Company (acting through its Provisional Liquidator) to oversee and implement the scheme of arrangement proposed to the Company’s creditors. The classification of creditors is a key element of this process. This refers to the categorisation of creditors based on their claims going into a scheme of arrangement and their treatment under it (see “How will Scheme Creditors’ Admitted Claims be classified?” below). The Scheme Administrator will communicate with Creditors to inform them of the proposed Scheme and seek their approval or consent for the Scheme.

The information on this page is a high-level summary only and is qualified by reference to the Explanatory Statement in connection with the Scheme. All Scheme Creditors are recommended to review the Explanatory Statement, which is available via the link at the bottom of this page.

Employees of the Company are not Scheme Creditors. As such, employees will not be subject to the Scheme and are not required to submit a Voting & Claim Form or any other information in connection with the Scheme.

Who will be involved in the Administration of the Scheme?

  1. Scheme Administrator

Due to his relevant experience, Shuko Ndhlovu of HLB Zambia has been appointed by the Company as Scheme Administrator and his team of experts is working to support the Company in implementing the Scheme. The Scheme Administrator shall be responsible for managing communication with Scheme Creditors in connection with the Voting and Claim Form and determining the appropriate Scheme Entitlements under the Scheme.

  1. Independent Claims Adjudicator

An Independent Claims Adjudicator will be appointed (if necessary) by the Scheme Administrator as soon as practicable after the receipt from a Scheme Creditor of a Dispute Notice following the rejection of his/her Scheme Claim, having regard to the nature of the Disputed Claim. The appointed Independent Claims Adjudicator will within 7 Business Days of his/her appointment (or such longer period as the Scheme Administrators reasonably allow at their sole, discretion), conclusively determine the amount of the Admitted Claim (if any) referred to him/her for independent adjudication. An Independent Claims Adjudicator will be an individual who is duly qualified, in the reasonable opinion of the Scheme Administrators, to discharge the functions and the powers of an Independent Claims Adjudicator with the appropriate expertise having regard to the nature of the Disputed Claim.”

How will Scheme Creditors’ Admitted Claims be classified?

“Class 1 Scheme Creditors” means any Scheme Creditors which, in aggregate with their affiliates, hold Admitted Claims with a value which is less than USD 1,000,000.00. Further details on payment structure for Class 1 Scheme Creditors under the Scheme are contained in the Explanatory Statement.

“Class 2 Scheme Creditors” means any Scheme Creditors which, in aggregate with their affiliates, hold Admitted Claims with a value which is equal to or greater than USD 1,000,000.00. Further details on payment structure for Class 2 Scheme Creditors under the Scheme are contained in the Explanatory Statement.”

NOTICE APPROVING AND SANCTIONING THE KONKOLA COPPER MINES PLC (In Provisional Liquidation)

SCHEME OF ARRANGEMENTS

 

NOTICE IS HEREBY GIVEN that by a ruling dated 28th day of June 2024 made in the above matter, the High Court of Lusaka (the Court) under Cause No. 2019/HP/0761 ordered that the Scheme of Arrangement with Scheme Creditors of the Company, as stated in the Explanatory Statement and Proposed in the Scheme Proposal be and is hereby approved and sanctioned in accordance with Section 46, 47 and 48 of the Corporate Insolvency Act No. 9 of 2017 of the laws of Zambia.

TAKE NOTICE THAT FURTHER the Court ordered and directed as follows:

  1. That within Seven (7) calendar days of the date of this Order, the Provisional Liquidator shall lodge a copy of this Order with PACRA pursuant to Section 46 (12)(a) of the Act; and
  2. That the Scheme is binding on all the Scheme Creditors of the Company being Class 1 and Class 2 Scheme Creditors as defined in the Explanatory Statement, and pursuant to Section 46 (8) of the Act.
  3. That upon sanctioning or approval of the Scheme and the Order of this Honourable Court rendering such approval being lodged with PACRA, the Scheme shall be binding on the Company pursuant to Section 46 (8) of the Act.
  4. That upon lodgement of a copy of this Order with the Registrar of PACRA pursuant to the Act and the Explanatory Statement and towards the attainment of the Restructuring Effective Date, that;
  • ) the 2nd Respondent deposits funds into Escrow Account for the Creditor Settlement Support, Community Support and Once-Off Employee Bonus Amount as follows on or before 8th day of July 2024;
  • United States Dollars Two Hundred and Twenty-Five Million (USD 225,000,000.00) for creditor settlement;
  • United States Dollars Twenty Million (USD 20,000,000.00) for the once-off community support loan;
  • United States Dollars Seven Hundred and Fifty Thousand Two Hundred (USD 750,000.00) for the once-off employee bonus.
  • ) the 2nd Respondent and the Petitioner shall cause communication to be made to the Escrow Agent for the release of the funds to the Company for onward disbursement to the Scheme Creditors as stipulated in the Explanatory Statement of the Scheme of Arrangement on or before the 10th day of July 2024.
  • ) the 1st Respondent is to receive the funds for the onward disbursement to the Scheme Creditors as stipulated in the Explanatory Statement of the Scheme of Arrangement, and the 2nd Respondent to deposit an amount equal to United States Dollars Twenty-Five Million (USD 25,000,000.00) as the balance of the creditor settlement amount.
  • ) the Winding-Up Proceedings shall, forthwith terminate upon confirmation by the Shareholders of the Company by way of Notice Filled into Court, following receipt by the Company of the funds referred to in (i) and (iii) above, that steps leading to termination of the Winding-Up Proceedings have been fulfilled and the same occur on or before the 12th of July 2024.
  • ) the Company shall be taken out of provisional; liquidation to being a going concern following upon confirmation by the Shareholders of the Company by way of Notice filled into Court, following receipt by the Company of the funds referred to in (i) and (iii) above, that steps leading to termination of the Winding-Up Proceedings have been fulfilled and that the Company is now a going concern and the same occur on or before the 12th of July 2024.
  • ) the Provisional Liquidator shall immediately vacate her position upon confirmation by the Shareholders of the Company by way of Notice filled into Court, following the receipt by the Company of the funds referred to in (i) and (iii) above, that steps leading to termination of the Winding-Up Proceedings have been fulfilled and vacation of the Provisional Liquidator vacating her position have been fulfilled and the same occur on or before the 12th of July 2024.
  • ) the Board of the Company be immediately reinstated upon confirmation of by the Shareholders of the Company by way of Notice filled into Court, following the receipt by the Company of the funds referred to in (i) and (iii) above, that steps leading to termination of the Winding-Up Proceedings have been fulfilled and vacation of the Provisional Liquidator vacating her position have been fulfilled and the same occur on or before the 12th of July 2024.
  1. that in line with the Explanatory Statement, that the Restructuring Effective Date occurs on or before 16th day of July 2024.
  2. that in line with the Explanatory Statement, payments to the Scheme Creditors shall commence within Fifteen (15) calendar days after the Restructuring Effective Date or the next succeeding day which is a Business Day with the fist distribution being on or before the 31st of July 2024 and the second distribution being on or before 20th August 2024.
  3. that in line with the Explanatory Statement and further to paragraph 6 above, the Scheme Administrator cause a Notice to be issued to Scheme Creditors in Newspapers of wide circulation that the Restructuring Effective Date has been obtained within three (3) calendar days of the Restructuring Effective Date.
  4. that in line with the Explanatory Statement, any Claims that would not have been submitted by the Bar Date (17:00h) (Lusaka time) on the date falling [30 days] from the Restructuring Effective Date, or if that day is not a Business Day, the next succeeding day which is a Business Day), the same being on the 15th August 2024, shall be forfeited.

TAKE FURTHER NOTICE that members or creditors may obtain a copy of the Ruling at the Scheme Administrator’s registered office, 2nd Floor Saturnia House 6392, Dunduza Chisidza Crescent, Longacres, Lusaka, or on the Scheme Website, https://kcmscheme.com/

Please enable JavaScript in your browser to complete this form.
(PACRA number for Zambian Entities)
Authorized Signatory Name (If Applicable)
Physical Address
Principal Contact Person

Claim & Account Details

(As at the Record Date (being 5:00p.m. (Lusaka time) on 17 May 2024 for Class 1 Scheme Creditors and 5:00p.m. (Lusaka time) on 23 May 2024 for Class 2 Scheme Creditors), I/we have or will have the following scheme claim”. (HLB, the Record Date is 7 Business Days before the Scheme Meetings so please confirm that our calculation above is accurate).
Including any VAT
Including any VAT
Including any VAT

Additional Details

Scheme Creditors are required to confirm details of their Claims and submit copies of documents relating to their Claim including any contracts (and any amendments, supplements, restatements, extensions, rectifications, and/or side letters thereto) and/or invoices and bills of any sort which are pertinent to each Scheme Creditor’s Claim.

Designated Account

Please confirm details of the bank account to which you would like your Scheme Entitlement to be paid (your “Designated Account”). Please note that the Designated Account will need to be in the legal name of the Scheme Creditor.

**

Please note payment of any Scheme Entitlements following the submission of this Form is subject to an assessment of the details of the relevant Claim by the Scheme Administrators (in consultation with the Company and the Scheme Creditor), based on the calculations and information contained within this Form and the documentation submitted by each Scheme Creditor in support of its Claim. The Scheme Administrators may contact Creditors from time to time to obtain further details of the Claim using the contact details confirmed by each Scheme Creditor in this Form. Scheme Creditors are encouraged to respond to any requests for further information from the Scheme Administrators as soon as possible.

SECTION B – Scheme Voting Instructions

(i) NOTICE OF ATTENDANCE
Tick box if appropriate
And I/We intend to vote at the Scheme Meeting as follows:

I / We understand that this expression of intention is not binding and that a Scheme Creditor may vote as they see fit at the Scheme Meeting (provided the Scheme Creditor or authorised representative of a Scheme Creditor wishing to attend the Scheme Meeting must bring his or her passport or other government-issued photographic identification to the Scheme Meeting):
Full Name
Physical Address

(ii) APPOINTMENT OF PROXY

You are recommended to appoint the Chair as your proxy. If this proxy is given to the Chair, you must sign in either the “FOR” or “AGAINST” box in SECTION ii below for the appointment to be valid. The person whom you appoint as your proxy need not be a Scheme Creditor of the Company but must attend the Scheme Meeting in person to represent you.
Tick box if appropriate
Tick box if appropriate
Full Name
Physical Address
Date / Time
as our proxy to act for us at the Scheme Meeting to be held on ________ 2024 commencing __________am/pm at _______________ for the purpose of considering and, if thought fit, approving, with or without modification, the proposed Scheme and, at such meeting or any adjournment thereof, for and in the name of the undersigned.
And I/We intend to vote at the Scheme Meeting as follows:

SECTION C

ELECTION FOR CLASS 2 SCHEME CREDITORS
THIS SECTION IS TO BE COMPLETED BY CLASS 2 SCHEME CREDITORS ONLY. A CLASS 2 SCHEME CREDITOR IS A SCHEME CREDITOR WHICH, IN AGGREGATE WITH ITS AFFILIATES, HOLDS CLAIMS THE AMOUNT OF WHICH IS EQUAL TO OR GREATER THAN USD 1,000,000.00. The Class 2 Scheme Creditor elects:

SECTION D

CONFIRMATION AND SUBMISSION OF FORM

Each Scheme Creditor hereby represents, warrants, confirms, agrees and undertakes (as applicable), that:

(a) Authorisations and elections binding:

all authority conferred or agreed to be conferred pursuant to this Form and every obligation of, and every authorisation, election, instruction and agreement given by, the Scheme Creditor under this Form will be binding upon it and its successors and assigns;

(b) Signatory powers:

its signatory to this Form is authorised by it to submit this Form on its behalf and that it has granted its signatory all rights, powers and authorities to bind it and to deal with its Claims (including by entering into any compromise or settlement with respect to such Claims);

(c) No other liabilities:

it has provided, through the submission of this Form, evidence of all Liabilities and any Claims which it has or may have against any Group Company, and it otherwise has no Claims against any Group Company (other than with respect to any Excluded Liabilities which shall continue);

(d) Security:

(i) it holds no security in respect of its Claim; and (ii) to the extent that it later discovers that it holds security in respect of its Claim, any such security shall be released, waived or excluded under applicable law and considered void, and that it will not commence or continue, or instruct, direct, support (or authorise any other person to commence or continue) any Proceedings or Enforcement Action in respect of or arising from any such security; and

(e) Information:

(i) this Form replaces and supersedes in all respects any Form which it has previously submitted to the Scheme Administrators; (ii) all of the information provided by it in this Form is complete and accurate as of the date of submission of this Form, and all evidence provided by it pursuant to or in connection with this Form was and, at the time of making this representation remains, true, current, complete and accurate in all respects and not misleading in any respect. In the event that it becomes aware that any information submitted in this Form is untrue, inaccurate or misleading in any material respect, it shall notify the Scheme Administrators and rectify any error as soon as reasonably practicable and in any event prior to the Bar Date; (iii) it shall promptly and reasonably respond to any requests for further information or clarification by the Scheme Administrators as may be necessary in order to allow the Scheme Administrators (in consultation with the Company and the relevant Scheme Creditor) to confirm its Scheme Entitlement; support (or authorise any other person to commence or continue) any Proceedings or Enforcement Action in respect of or arising from any such security; and

(f) Independent and Informed Decision:

(i) it has received, and has reviewed, the Explanatory Statement and the Scheme and acknowledges, in its capacity as a Scheme Creditor, that in completing and submitting this Form, it has made its own independent decision as to how to exercise its vote (or instruct its proxy to vote) at the Scheme Meeting and in the case of Class 2 Scheme Creditors, as to how to exercise its election set out in Section C (Election for Class 2 Scheme Creditors), in each case in consultation with its own representatives and professional advisers to the extent it has considered it necessary to do so; (ii) it acknowledges that, to the extent that the relevant parts of this Form have been validly completed, the submission of this Form constitutes its written consent to the Scheme and the other matters contained herein; (iii) it undertakes to be bound by, and perform, each of the obligations set out in the Scheme and each of the Restructuring Documents (as applicable) as if set out in full in this Form and is assuming all of the risks inherent in participating in the Scheme and has undertaken all the appropriate analysis of the implications of participating in the Scheme without relying on the any Group Company, the Scheme Administrators or the Information Agent (other than any representations or warranties given in favour of that Scheme Creditor by the Company under the Explanatory Statement and any other Restructuring Document and, if applicable, the Lock-up Agreement);

(g) Applicable law and regulation:

it is not, so far as it is aware, contrary to applicable law or regulation in any relevant jurisdiction for the Scheme Administrators and/or the Company to accept its vote on the Scheme or distribute to it its Scheme Entitlement;

(h) Transfers, assignments and disposals:

: it has not, at any time after the Record Date, transferred, assigned, charged, disposed of, or entered into a sub-participation arrangement or otherwise granted any right of any nature to any person in respect of any of its Claims or the Liabilities owed to it (other than (if it is a party thereto) as expressly permitted by the Lock-up Agreement); and (i) Disputes: it will negotiate reasonably and in good faith to resolve any dispute in connection with this Form (or its Claim) up to (and including) the Bar Date.
Confirmation
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