RESPONSE TO STANDARD & POOR’S MEDIA RELEASE ON THE NEW RECLAMATION GROUP

7 November 2012

Further to the media release by Standard & Poor's dated 7 November 2012, The New Reclamation Group notes the following in response:

The company does not consider the buyback of its bonds as a distressed exchange.
It rather views the buybacks as a continuation of its stated policy to manage its debt by repurchasing bonds in the open market if and when the opportunity arises. The company has repurchased bonds in the open market on prior occasions – for example in 2008.
The company believes that the buybacks in 2012 (similarly to 2008) had a positive effect on its debt profile for the following reasons:
It has reduced overall leverage and interest expense by reducing the bond liability by 24%.
The security cover has increased.
The maturity profile of the company’s liabilities has been partially extended.

Furthermore, we re-iterate the disclosure that was made to bondholders on 30 October 2012 below:

The secured bonds which mature on 1 February 2013 are reflected in the annual financial statements as a current liability. In order for the company to settle its financial obligation in terms of the secured bonds, the board has assessed and is negotiating a combination of the following refinancing transactions:

Raising term loan funding from local and/or offshore lenders.
Raising finance utilising the group’s property portfolio.
Raising finance utilising the group’s plant and equipment.
Purchasing of bonds through open market purchases utilising internally generated funds.
Raising funding from shareholders.

Based on various discussions and progress with the various potential funders the directors believe that the company will meet its obligations in terms of the secured bonds as they fall due.