Bezant Resources PLC Mankayan Project Update (2143E)

TIDMBZT

RNS Number : 2143E

Bezant Resources PLC

26 October 2022

26 October 2022

Bezant Resources Plc

("Bezant" or the "Company")

Mankayan Project Update

Bezant (AIM: BZT), the copper-gold exploration and development company, further to its announcement dated 18 March 2022 announces that on 26 October 2022 it entered into;

-- a conditional share purchase agreement (the "SPA") to exchange its 27.5% shareholding in IDM Mankayan Pty Ltd ("IDM Mankayan") for a 27.5% shareholding in IDM International Limited (ACN 108029198) ("IDM International"). Upon completion of the SPA and a similar SPA between IDM International and the other shareholder of IDM Mankayan (the "Other IDM Mankayan Shareholder") IDM International will own 100% of IDM Mankayan; and

-- a convertible loan note agreement with IDM International to invest A$137,500 (approx. GBP77K) in IDM International (the "Convertible Loan Note"). IDM International has also entered into convertible loan notes with entities associated with two of its directors to raise A$362,500 (approx. GBP203K) on the same terms as the Convertible Loan Note (together the "Convertible Notes")

Colin Bird, Executive Chairman of Bezant, commented: " We are very pleased with the progress made in advancing the Mankayan Project since IDM International's involvement not least the renewal of the MPSA for 25 years which is a catalyst for the development of this world class copper gold porphyry project. We are very confident that management in the Philippines supported by IDM International have the experience and expertise to take the project forward through the next stages of evaluation and development which will significantly enhance the value of the project."

IDM International, through Crescent Mining Development Corporation's ("Crescent"), have made very good progress on initial Pre-Feasibility Studies on the Mankayan copper gold project in the Philippines since IDM Mankayan acquired its interest in the Mankayan project in October 2021. This has included:

-- Renewal by the Mines and Geosciences Bureau of the Department of Environment and Natural Resources of the Philippines government ("MGB") of Crescent's Mineral Production Sharing Agreement No. 057-96-CAR (the "MPSA") for a second 25-year term with effect from 12 November 2021 (the "MPSA Renewal");

-- Meetings with the MGB who have expressed their support and encouragement for local projects such as the Mankayan Project and working closely with various Government departments for approvals required for the development of the Mankayan Project;

   --      Working closely with the local communities including direct investment into those areas; 

-- The completion of 2 Pre-feasibility holes to depths of 1,000m each focusing on metallurgy, geotechnical and hydrogeological studies and the collection and management of all data produced from the 2 holes for analysis by Crescent's in country team and its advisors;

-- Commencement of the process of appointing key consultants who will be undertaking Pre-Feasibility Studies work, including mine designs and engineering studies, infrastructure and tailings facilities, environmental studies and indigenous peoples' consent; and

-- Discussions with private equity and mining finance houses for the funding of the Pre-Feasibility Studies work program.

Going forward, IDM International and Crescent, along with their various consultants and advisors, intend to complete a full Pre-Feasibility Studies during 2023 and 2024 that will present the Mankayan Project as a globally significant copper-gold project at a time when the supply-demand gap for copper is expected to be large as the world transitions to electrification.

Summary of the key terms of the SPA dated 26 October 2022

 
 Parties                   Bezant Resources Plc and IDM International 
                            Limited 
------------------------  ---------------------------------------------------------------------------------- 
 Sale Shares               The 44 fully paid ordinary shares in the capital 
                            of IDM Mankayan held by Bezant and representing 
                            27.5% of the shares issued by IDM Mankayan 
------------------------  ---------------------------------------------------------------------------------- 
 Consideration Shares      19,381,054 fully paid ordinary shares in the 
                            capital of IDM International representing 
                            27.5% of the shares in issue by IDM International 
                            as enlarged by its acquisition of the Sale 
                            Shares and the 10% of IDM Mankayan that it 
                            is acquiring from the Other IDM Mankayan Shareholder. 
------------------------  ---------------------------------------------------------------------------------- 
 Conditions                (a) IDM International obtaining the approval 
                            of its shareholders for the issue of the Consideration 
                            Shares to Bezant 
                            (b) completion of the transaction whereby 
                            IDM International will acquire 10% of IDM 
                            Mankayan from the Other IDM Mankayan Shareholder 
                            so that at Completion IDM International will 
                            own 100% of IDM Mankayan; and 
                            (c) the Other IDM Mankayan Shareholder and 
                            Bezant waiving their pre-emption rights in 
                            relation to IDM International acquiring all 
                            the shares of IDM Mankayan which they do not 
                            already own 
------------------------  ---------------------------------------------------------------------------------- 
 Deadline for completion   31 March 2023 or such other date as may be 
                            agreed to by the parties in writing 
------------------------  ---------------------------------------------------------------------------------- 
 Restrictions on IDM                                  (a) (a) IDM International will not, until 
  International pending                                the earlier of Completion or termination of 
  completion                                           the SPA: (i) (i) subject to (b) below, issue 
                                                       any securities (including convertible loan 
                                                       notes or other instruments convertible into 
                                                       IDM International ordinary shares) other than 
                                                       for cash consideration and provided that Bezant 
                                                       has first been given the opportunity, on 14 
                                                       days written notice, to subscribe for 27.5% 
                                                       of the securities offered on the same terms 
                                                       as those offered to participants in the proposed 
                                                       new issue; (ii) (ii) create any new class 
                                                       of shares; or (iii) (iii) make any material 
                                                       changes to the conduct of its Business which 
                                                       is the supporting and development of the Mankayan 
                                                       Project, and anything related thereto . (iv) 
                                                       (b) (b) (a) (i) above does not apply to an 
                                                       issue by IDM International of: (i) securities 
                                                       pursuant to a capital raising of at least 
                                                       A$2 million (before costs) from an investor 
                                                       (or group of investors); the Convertible Notes 
                                                       (and their subsequent exercise into IDM International 
                                                       ordinary shares); (i) (ii) any shares or options 
                                                       issued in connection with the exercise of 
                                                       the Convertible Notes; (ii) (iii) securities 
                                                       in response to the exercise of options or 
                                                       performance rights on issue (or approved for 
                                                       issue) as at the date of the SPA; or (iii) 
                                                       (iv) incentive securities to directors, employees 
                                                       and/or personnel of IDM International or IDM 
                                                       Mankayan, or to others engaged in the Mankayan 
                                                       Project, as approved by the directors of IDM 
                                                       International. 
------------------------  ---------------------------------------------------------------------------------- 
 Warranties                The parties have given warranties customary 
                            in an agreement of this nature. 
------------------------  ---------------------------------------------------------------------------------- 
 

Summary of the Key terms of the Convertible Loan Note dated 26 October 2022

 
 Parties                 Bezant Resources Plc and IDM International 
                          Limited 
----------------------  ---------------------------------------------------------------- 
 Amount being invested   A$137,500 (approx. GBP 77K) to acquire 137,500 
                          Notes 
----------------------  ---------------------------------------------------------------- 
 Payment Terms & Issue   Payment is within 21 Days from date of agreement 
  Date                    (the " Issue Date ") 
----------------------  ---------------------------------------------------------------- 
 Maturity Date           4 years from Issue Date 
----------------------  ---------------------------------------------------------------- 
 Interest                4% per annum which is repayable at the Maturity 
                          Date unless the Notes have been converted 
                          prior to the Maturity Date 
----------------------  ---------------------------------------------------------------- 
 Conversion Terms                   The Company has the right to convert the whole 
                                     but not part of the Face Value of each Note 
                                     into Shares at A$0.20 at any time (and as 
                                     many times) prior to the Maturity Date (the 
                                     "Conversion Terms") 
----------------------  ---------------------------------------------------------------- 
 Early Conversion                   Subject to (a) and (b) below the IDM International 
  by IDM International               may elect to redeem the Notes from the Company 
                                     before the Maturity Date to the extent they 
                                     have not then been converted under the Conversion 
                                     Terms by paying to the Company an amount equal 
                                     to 110% of the Principal Amount owing under 
                                     the Notes ("Early Redemption") provided that 
                                     Early Redemption is only permitted; 
 
                                     (a) from 2 years after the Issue Date; and 
                                     (b) on IDM International giving 30 days notice 
                                     to the Company during which period the Company 
                                     can elect to convert the Notes under the Conversion 
                                     Terms 
----------------------  ---------------------------------------------------------------- 
 Options to be issued    For each 2 shares in IDM International issued 
  to the Company at       to the Company under the Conversion Terms 
  Conversion              the Company will also be issued one free new 
                          option to acquire an IDM International share 
                          (an " IDM Option ") with an exercise price 
                          A$0.40 within the 4 years from the date of 
                          issue of the IDM Option. 
----------------------  ---------------------------------------------------------------- 
 Warranties              The parties have given warranties customary 
                          in an agreement of this nature. 
----------------------  ---------------------------------------------------------------- 
 

Further information on IDM International

IDM International Limited is incorporated in Australia. For the year ended 30 June 2021 IDM International made an audited loss of A$12,319 (approx. GBP6,900) and as at that date had net assets of A$3,484 (approx. GBP1,956) . Post 30 June 2021 IDM International established IDM Mankayan Pty Ltd which was incorporated in Australia on 6 August 2021 as a special purpose vehicle to enter into the IDM Agreement in relation to the Mankayan Project with Bezant Resources Plc (see announcement dated 13 September 2021) which completed in October 2021 . For the period from incorporation to 31 December 2021 IDM Mankayan Pty Ltd made an unaudited profit of A$NIL and as at that date had net assets of A$160 (approx. GBP90). As at the date of this announcement IDM International owns 62.5% of IDM Mankayan Pty Ltd which is its sole subsidiary.

For further information, please contact:

 
Bezant Resources Plc 
 Colin Bird, Executive Chairman          [phone] 
Beaumont Cornish (Nominated Adviser) 
 Roland Cornish                          [phone] 
Novum Securities Limited (Broker) 
 Jon Belliss                             [phone] 
 

or visit http://www.bezantresources.com

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 as it forms part of UK Domestic Law pursuant to the Market Abuse (Amendment) (EU Exit) regulations (SI 2019/310).

Technical Glossary

 
 "Pre-Feasibility   A Preliminary Feasibility Study (Pre-Feasibility 
  Study"             Study) is a comprehensive study of a range of 
                     options for the technical and economic viability 
                     of a mineral project that has advanced to a 
                     stage where a preferred mining method, in the 
                     case of underground mining, or the pit configuration, 
                     in the case of an open pit, is established and 
                     an effective method of mineral processing is 
                     determined. It includes a financial analysis 
                     based on reasonable assumptions on the Modifying 
                     Factors and the evaluation of any other relevant 
                     factors which are sufficient for a Competent 
                     Person, acting reasonably, to determine if all 
                     or part of the Mineral Resources may be converted 
                     to an Ore Reserve at the time of reporting. 
                     A Pre-Feasibility Study is at a lower confidence 
                     level than a Feasibility Study. 
-----------------  ------------------------------------------------------- 
 

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October 26, 2022 07:21 ET (11:21 GMT)