Convertible Loan Facility Agreement

Arc Minerals Ltd

('Arc' or the 'Company')

Convertible Loan Facility Agreement

Arc Minerals ("Arc" or the "Company") is pleased to announce that the Company has entered into definitive agreements with a consortium of French and Swedish institutional and high net worth investors (the "Lenders") to raise, in aggregate, approximately US$1.7m through the issue of unsecured convertible loan notes ("CLN").  No funds have been drawn down under the convertible loan notes as at the date of this announcement but it is intended that the proceeds from the CLN facility will be used for working capital purposes.

The key terms of the CLN are set out below:

·     The CLN are interest free. 

·     The loan notes are convertible into ordinary shares of the Company at the option of the relevant holder at 4.5 pence per Ordinary Share, representing a premium of 66% to the closing price of 2.7 pence per share on 27 December 2019  or, in the  event that Arc undertakes a placement of shares, a Lender can convert all or part of the principal at the relevant placement price subject to a minimum of 110% of the principal. 

·     The repayment date is 12 months following the drawdown date and Arc shall repay 120% of the aggregate value of the Principal amount*

Nick von Schirnding, executive chairman of Arc commented:

"This is an excellent deal for Arc which provides competitive funding for us and will materially strengthen our balance sheet.  The potential conversion price of 4.5p represents a significant premium to our current share price which benefits all of our shareholders.  Together with the anticipated proceeds from the sale of Casa and Sturec of $1.8m and $0.5m respectively, the cash resources of Arc would be at or above $4m which gives us significant firepower to drive forward our exciting exploration programme in Zambia in 2020."

*In the event of a default by the Company a 4% interest rate would accrue

**ENDS**

Contacts

Market Abuse Regulation (MAR) Disclosure

Certain information contained in this announcement would have been deemed inside information for the purposes of Article 7 of Regulation (EU) No 596/2014 until the release of this announcement.

Forward-looking Statements

This news release contains forward-looking statements that are based on the Company's current expectations and estimates. Forward-looking statements are frequently characterised by words such as "plan", "expect", "project", "intend", "believe", "anticipate", "estimate", "suggest", "indicate" and other similar words or statements that certain events or conditions "may" or "will" occur. Such forward-looking statements involve known and unknown risks, uncertainties and other factors that could cause actual events or results to differ materially from estimated or anticipated events or results implied or expressed in such forward-looking statements. Such factors include, among others: the actual results of current exploration activities; conclusions of economic evaluations; changes in project parameters as plans continue to be refined; possible variations in ore grade or recovery rates; accidents, labour disputes and other risks of the mining industry; delays in obtaining governmental approvals or financing; and fluctuations in metal prices. There may be other factors that cause actions, events or results not to be as anticipated, estimated or intended. Any forward-looking statement speaks only as of the date on which it is made and, except as may be required by applicable securities laws, the Company disclaims any intent or obligation to update any forward-looking statement, whether as a result of new information, future events or results or otherwise. Forward-looking statements are not guarantees of future performance and accordingly undue reliance should not be put on such statements due to the inherent uncertainty therein.

Notes to the Editors

Arc Minerals is an AIM listed exploration and mine development company focused on a diversified portfolio of mining projects with interests in Slovakia, Eritrea, the Democratic Republic of the Congo and Zambia. 

ARC Minerals current holdings include:

●   100% interest in CASA Mining Limited, a private company that has a 71.25% interest in the 3-million-ounce inferred Resource Akyanga gold deposit in the DRC.

●   A 66% equity interest in Zamsort Limited ("Zamsort"), a private company focused on a prospective copper t licence in the Zambia Copperbelt, together with a convertible loan to Zamsort which converts into approximately a five percent additional equity interest in Zamsort.

●   A 52.5% equity interest in Zaco Limited ("Zaco"), a private company focussed on a prospective copper and cobalt license adjacent to Zamsort.

For more information visit www.arcminerals.com