Metal Tiger plc (LON:MTR) £1m Placing and Non-binding term sheet signed with Sprott

£1.0 million Placing and Non-binding term sheet signed with Sprott to raise up to an additional £3.0 million.

The Company will also issue to participants in the Placing one warrant for every two Placing Shares subscribed for by them in the Placing (the “Warrants”). Each Warrant will entitle the holder to acquire one new Ordinary Share (a “Warrant Share”) on its exercise. Each Warrant will be exercisable at a price of 2p during a two-year period commencing from the date of admission of the Placing Shares and will be non-transferable.

The Placing was undertaken by the Company’s sole broker, SI Capital.

In addition to the Placing, the Company is pleased to announce that it has signed a non-binding term sheet with Sprott Capital Partners LP and certain of its affiliates (“Sprott”) (the “Sprott Term Sheet”). Sprott will act as finders on behalf of the Company in order to complete a non-brokered private placement to raise up to an additional approximately £3.0 million (the “Sprott Offering”) through the issue of new Ordinary Shares (“Sprott Offering Shares”) at the Placing Price and the further issue to participants in the Sprott Offering of one warrant for every two Sprott Offering Shares subscribed for by them in the Sprott Offering (the “Sprott Warrants”). Each Sprott Warrant will entitle the holder to acquire one new Ordinary Share upon exercise of the Sprott Warrant in accordance with its terms (a “Sprott Warrant Share”). Each Sprott Warrant will be exercisable at a price of 2p during a two-year period commencing from the date of admission of the Sprott Offering Shares and will be non-transferable. The Sprott Offering is expected to close on or before 8 March 2019 (“Closing Date”) and is subject to the conditions as detailed below being satisfied.

Overview of the Placing:

  • Placing of 70,010,345 Placing Shares at the Placing Price to raise gross proceeds of approximately £1.0 million;
  • Issue of 35,005,172 Warrants to subscribe for 35,005,172 Warrant Shares at an exercise price of 2p per Warrant;
  • Placing Price represents an approximate 11.5% premium to the middle market closing price on 8 February 2019, the last trading day prior to this announcement;
  • Placing undertaken with new and existing Metal Tiger shareholders;
  • Certain members of the board of directors of Metal Tiger (“Directors” and together the “Board”) and associates are participating in the Placing for, in aggregate, £210,000;
  • The net proceeds of the Placing, together with existing cash resources, will be used, inter alia, to continue to support the Company’s joint venture projects with its partners, MOD Resources Limited (“MOD”) and Kalahari Metals Limited (“Kalahari Metals”), in the Kalahari Copper Belt in Botswana and to provide general working capital to the Company; and
  • The Placing is not conditional on the completion of the Sprott Offering.

Terms of the Sprott Offering:

  • Non-binding term sheet signed with Sprott to raise up to an additional approximately £3.0 million through the issue of up to 206,900,000 Sprott Offering Shares at the Placing Price;
  • Subject to Sprott raising funds pursuant to the Sprott Offering, the issue of up to 103,450,000 Sprott Warrants to subscribe for 103,450,000 Sprott Warrant Shares at an exercise price of 2p per Sprott Warrant and exercisable within a two-year period commencing from the date of admission of the Sprott Offering Shares;
  • Metal Tiger may, at its discretion, should the Sprott Offering be oversubscribed, elect to accept a larger fundraise than 206,900,000 Sprott Offering Shares, at the Placing Price;
  • The Sprott Offering will be completed to accredited investors (as defined in National Instrument 45-106 Prospectus Exemptions) in all provinces of Canada, to accredited investors (as defined in section 501(a) of Regulation D in the United States) pursuant to an exemption from the registration requirements of Regulation D of the United States Securities Act of 1933, as amended (the “1933 Act”), and, with the consent of the Company, to suitable investors in other eligible foreign jurisdictions (other than Canada and the United States) pursuant to applicable private placement exemptions under applicable securities laws in such jurisdictions; provided that no prospectus, registration statement or similar document is required to be filed in such jurisdiction and the Company does not become subject to continuous disclosure obligations in such jurisdiction; and
  • The Closing Date will be subject to certain conditions outlined below (the “Closing Conditions”) and the Sprott Offering is conditional upon the Closing Conditions being satisfied, which include, inter alia, completion of corporate due diligence on Metal Tiger, including favourable legal opinions of counsel to Metal Tiger in connection with corporate, securities and title matters, as well as the execution of binding documentation in relation to the Sprott Offering between the Company and Sprott (the “Sprott Agreements”). The Sprott Offering will also be conditional upon any required regulatory approvals.

Michael McNeilly, Chief Executive Officer of Metal Tiger, commented:

“We are very pleased with the level of support we have received in respect of the Placing from new and existing investors. The Placing will enable Metal Tiger to, among other things, enter into constructive negotiations with Kalahari Metals, regarding the Company potentially providing further financing for proposed exploration drilling at the Okavango and Ngami projects. It will also allow us to continue to take advantage of opportunities that are identified by the Company.

We are also delighted to have entered into the Sprott Term Sheet to raise up to an additional approximately £3.0 million. Such additional funding will provide yet further support to our strategy and we look forward to updating shareholders in this regard.”

Related Party Transactions

Directors’ participation in the Placing

Michael McNeilly and Charles Hall, Chief Executive Officer and Non-Executive Chairman of the Company respectively, are participating in the Placing, investing £14,500 and £58,000 for 1,000,000 and 4,000,000 Placing Shares together with 500,000 and 2,000,000 Warrants respectively. In addition, Dianne Grammer, the wife of Terry Grammer, a Non-Executive Director of the Company, is investing £137,500 for 9,482,759 Placing Shares together with 4,741,379 Warrants. As Directors and an associate of a Director, they are deemed to be related parties of the Company as defined in the AIM Rules for Companies (“AIM Rules”), and accordingly their participation in the Placing (“Directors’ Participation”) constitutes a related party transaction pursuant to Rule 13 of the AIM Rules.

The independent Directors of Metal Tiger (being Mark Potter and Neville Bergin), consider, having consulted with the Company’s nominated adviser, Strand Hanson Limited, that the terms of the Directors’ Participation in the Placing are fair and reasonable insofar as the Company’s shareholders are concerned.

Sprott Offering

Sprott is an associate of Exploration Capital Partners 2014 Limited Partnership, a substantial shareholder of the Company as defined in the AIM Rules, and therefore Sprott is deemed to be a related party of the Company for the purposes of the AIM Rules. As a result, the entering into the Sprott Agreements will constitute a related party transaction for the purposes of Rule 13 of the AIM Rules, at that time.

Admission

The Placing is conditional upon, amongst other things, admission of the Placing Shares to trading on AIM (“Admission”). Following Admission, the Placing Shares will represent, in aggregate, approximately 4.93% of the Company’s then enlarged issued ordinary share capital.

Application will be made to the London Stock Exchange for the Placing Shares to be admitted to trading on AIM. It is expected that Admission of the Placing Shares will become effective and that dealings in the Placing Shares will commence at 8.00 a.m. on or around 18 February 2019.

Following the issue of the Placing Shares, the number of Ordinary Shares in issue in the Company will increase to 1,419,966,410. For the purposes of the FCA’s Disclosure Guidance and Transparency Rules (“DTRs”), the issued Ordinary Share capital of Metal Tiger following Admission will consist of 1,419,966,410 Ordinary Shares with voting rights attached (one vote per Ordinary Share). There are no Ordinary Shares held in treasury. This total voting rights figure may be used by shareholders as the denominator for the calculation by which they will determine whether they are required to notify their interest in, or a change to their interest in, Metal Tiger under the DTRs.

For further information on the Company, visit: www.metaltigerplc.com

 


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