Path Investments plc Heads of Agreement with ARC

Path Investments Plc ORD GBP0.001

Path Investments plc (LON: PATH) today announced that the Company has entered into a Heads of Agreement with ARC Marlborough Pty Limited regarding the proposed acquisition of ARC by the Company.

ARC is a privately owned, Australian incorporated company, that owns a mining tenement situated in Central Queensland, Australia. ARC has relevant government approvals to mine Nickel, Cobalt and Chrysoprase at this tenement.

ARC proposes to develop its Nickel and Cobalt project (the “Project”) with the intention of producing and supplying high grade and specifically determined nickel and cobalt products for use in the rapidly expanding battery industry, such as Nickel Sulphate and Cobalt Sulphate.

To achieve that outcome, the Company proposes to adopt atmospheric leaching processes such as heap leaching or vat leaching, or a combination of both, with the intention of establishing a low cost, low CAPEX operation.

The Project ore is recoverable either at, or near surface, the resource having a very low strip ratio. In working towards a positive Project outcome, RF West has produced a Scoping Study in respect of the Project and which has determined the general parameters for the Project.

It is now proposed to complete additional confirmatory drilling, infill drilling, and drilling to depth of about 40 additional drill holes for the purpose of upgrading the resource and the resource grades. In addition, it is proposed to carry out bulk sampling and conduct metallurgical test work and leach tests. Thereafter it is proposed to proceed with a Pre-Feasibility Study, followed by a Bankable Feasibility Study on the Project.

The Heads of Agreement

The Heads of Agreement envisages that the Company, by way of a Purchase Agreement, will acquire 100 per cent. of the equity share capital of ARC, including all the assets owned by ARC, through the issue of new ordinary shares of £0.001 each in the Company (“Ordinary Shares”).

The Company has agreed an exclusivity period with ARC and expects to enter into a definitive Purchase Agreement on or before 28 February 2019.

Completion of the Proposed Transaction is conditional, inter alia, on the following:

· the completion of confirmatory legal, financial and technical due diligence;

· approval by the necessary authorities to the transfer of ARC’s assets to the Company;

· an appropriate Purchase Agreement being entered into including customary warranties and representations;

· any required shareholder consents being obtained (including a waiver of rule 9 of the City Code on Takeovers and Mergers);

· in order to provide an appropriate level of working capital for the enlarged Company following the Proposed Transaction the Company intends to undertake an equity fundraising (“Placing”); and

· publication by the Company of a prospectus and readmission of the Company’s Ordinary Shares to trading on the Main Market of the London Stock Exchange.

Continued Suspension of Trading

If completed, the Proposed Transaction would be classified as a reverse takeover in accordance with the Listing Rules of the Financial Conduct Authority. Accordingly, the listing of the Ordinary Shares on the Standard Listed Segment of the Official List and trading in the Ordinary Shares on the Main Market of the London Stock Exchange will remain suspended. If the Proposed Transaction completes, the Company intends to seek readmission to trading on the Main Market of the London Stock Exchange.

The parties intend to proceed as quickly as possible with the Proposed Transaction. However, there can be no certainty that the Proposed Transaction will be successfully completed.

The Company will make further announcements in due course, as appropriate.

Christopher Theis, Chief Executive of Path, commented: “We are delighted to have entered into the Heads of Terms with ARC. We believe the Proposed Transaction is one that can deliver significant value for Path shareholders and we look forward to making further announcements in due course.”

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