Agriterra Ld Regulatory News (AGTA)

The information contained within this announcement is deemed by the Company to constitute inside information as stipulated under the UK version of the Market Abuse Regulations (EU) No. 596/2014 ("MAR"). With the publication of this announcement via a Regulatory Information Service, this inside information is now considered to be in the public domain.

NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, DIRECTLY OR INDIRECTLY, IN WHOLE OR IN PART, IN, INTO OR FROM, AUSTRALIA, NEW ZEALAND, CANADA, JAPAN OR THE REPUBLIC OF SOUTH AFRICA OR ANY OTHER JURISDICTION IN WHICH THE SAME WOULD BE UNLAWFUL.

THIS ANNOUNCEMENT DOES NOT CONSTITUTE AN OFFER TO BUY, ACQUIRE OR SUBSCRIBE FOR (OR THE SOLICITATION OF AN OFFER TO BUY, ACQUIRE OR SUBSCRIBE FOR) ORDINARY SHARES TO ANY PERSON WITH A REGISTERED ADDRESS IN, LOCATED IN, OR WHO IS A RESIDENT OF, THE UNITED STATES, AUSTRALIA, NEW ZEALAND, CANADA, JAPAN OR THE REPUBLIC OF SOUTH AFRICA OR IN ANY OTHER JURISDICTION IN WHICH SUCH OFFER, SOLICITATION OR SALE WOULD BE UNLAWFUL OR CONTRAVENE ANY REGISTRATION OR QUALIFICATION REQUIREMENTS UNDER THE SECURITIES LAWS OF ANY SUCH JURISDICTION.

20 March 2023

Agriterra Limited ('Agriterra' or the 'Company')

Agriterra Limited / Ticker: AGTA / Index: AIM / Sector: Agriculture

Placing, Broker Option and Issue of Inaugural PILOW Instrument

Agriterra, the AIM-quoted African agricultural company, is pleased to announce a placing (the "Placing") to raise £200,000 (gross) through the issue of 20,000,000 new ordinary shares ("Ordinary Shares") at a price of 1 pence per share (the "Issue Price") via the Company's broker, Peterhouse Capital Limited ("Peterhouse"). The Placing has not been underwritten.

Highlights

· Placing to raise £200,000, through the issue of 20,000,000 new Ordinary Shares (the "Placing Shares") at the Issue Price

· Conversion of £200,000 of debt held by Magister Investments Limited ("Magister") in the Company into 20,000,000 new Ordinary Shares at the Issue Price ("Conversion Shares") and under the same terms as the Placing ("Debt Conversion")

· Participants in the Placing and Debt Conversion to receive one Protected In-the-money Loyalty Warrant ("Pilow") for every Placing Share or Conversion Share issued

· Broker option (the "Broker Option") for up to a further 5,000,000 new Ordinary Shares, which could raise up to a further £50,000 enabling existing shareholders to fully participate in the Placing and the issuance of associated Pilows via Peterhouse

· Net proceeds of the Placing, along with any funds raised via the Broker Option, will be applied primarily towards the Company's Mozbife division, including the purchasing of an additional 1,500 cattle, as well as providing additional working capital to allow the Company to support its other growth initiatives.

· Admission of the Placing Shares and the Conversion Shares is expected to occur on or around 23 March 2023 ("Admission")

Caroline Havers, Chair, said: "We totally recognise the very difficult current fund-raising and stock market environment. Hence our sincere appreciation for those investors who have participated in today's fund-raise and for those who may do so under the Broker Option. With this in mind, we readily accepted our Broker, Peterhouse's proposal that we give all participants free warrants, particularly as this new type of warrant is primarily designed to offer our incoming and existing loyal shareholders a future potential opportunity to exercise at a discounted price.

With this funding in place and the continuing strong financial support from our majority shareholder, Magister, Agriterra is moving steadily along in terms of implementing its ambitious growth plans, and we are only too pleased that with the proposed first ever issuance of these innovative PILOWS, we can equally be at the forefront in the development of new, shareholder-friendly, capital market initiatives".

Details of the Placing

The Company has resolved to issue 20,000,000 Placing Shares at the Issue Price raising gross proceeds of £200,000.

Use of Proceeds

The net proceeds of the Placing, along with any funds raised via the Broker Option, will be applied primarily towards the Company's Mozbife division, including the purchasing of an additional 1,500 cattle, as well as providing additional working capital to allow the Company to support its other growth initiatives.

Terms of the Pilows

As part of the Placing, the Company will issue participants in the Placing, the Broker Option and Debt Conversion (i.e. Magister) ("Pilow Holders" or "Holders") with Protected In-the-money LOyalty Warrants ("Pilows"). The Pilows are being offered on a one for one basis, such that for every share issued pursuant to the Placing, the Broker Option and the Debt Conversion, investors will receive one Pilow.

The number of Pilows issued to participants in the Placing and the Debt Conversion will therefore be 40,000,000. The number of Pilows granted to existing shareholders under the Broker Option will be determined following the closing of the Broker Option.

The life of the Pilows will be 24 months from the date of issue unless exercised via an Issuer Call, details on which are below.

At any time during the life of the Pilows, the Company may call for the immediate exercise of some or all of the Pilows outstanding (the "Issuer Call"). The Issuer must state a record date, which must be the last business day prior to the Issuer Call being made ("Record Date") and must give Holders a minimum of five (5) business days' notice to exercise. Holders have no right to exercise the Pilows unless and until an Issuer Call is made.

In order for a Pilow Holder to be entitled to exercise when an Issuer Call is made, the Holder must, at the Record Date, hold at least the same number of Ordinary Shares in the Company as the number of Pilows to be exercised. The exercise price of the Pilows ("Exercise Price") must be set by the Company by reference to the closing bid price of the Ordinary Shares on the Record Date and the Exercise Price must be at a discount to that bid price. The level of discount applied to the Record Date bid price (i.e., the Exercise Price) shall be at the sole determination of the Company.

When an Issuer Call is made, Holders may choose to exercise their entitlement of Pilows in whole or in part. Any non-exercised Pilows shall remain extant, under the same terms and conditions as outlined herein.

Under certain conditions, if the Company undertakes any form of equity placing during the life of the Pilows, it must, simultaneously with the equity placing, also make an Issuer Call for all outstanding Pilows, the Exercise Price being equivalent or less (at the Issuer's sole discretion) to the equity placing price.

In the event of a take-over or merger of the Issuer, or the acquisition of a stake by a single entity of more than 29.9% of the Issuer's issued share capital, the Issuer must immediately undertake an Issuer Call for all outstanding Pilows, on the terms and conditions outlined above, including as to pricing.

The Pilows will be constituted under the terms of a Warrant Instrument Deed and a Warrant Certificate will be issued to each Holder. The Pilows will not be transferable, other than in exceptional circumstances and with the consent of the Issuer, and will not be listed or admitted to trading.

Broker Option

In order to provide qualifying Agriterra shareholders ("Existing Shareholders") and other qualified investors with an opportunity to participate on the same basis as the investors in the Placing, the Company has granted Peterhouse a Broker Option over up to 5,000,000 new Ordinary Shares (or such other number of Ordinary Shares as agreed between the Company and Peterhouse) ("Broker Option Shares"). Full take up of this number of new Ordinary Shares under the Broker Option would raise a further £50,000 for the Company, before expenses.

Existing Shareholders who hold Ordinary Shares in the Company and are on the register of members as at the close of business on 17 March 2023, will be given a priority right to participate in the Broker Option and all orders from such Existing Shareholders will be accepted and processed by Peterhouse, subject to scale-back in the event of over-subscription under the Broker Option. The Broker Option has not been underwritten. Peterhouse is entitled to participate in the Broker Option as principal.

The Broker Option is exercisable by Peterhouse on more than one occasion, at any time from the time of this announcement to 5 p.m. UK time on 21 March 2023, at its absolute discretion, following consultation with the Company. There is no obligation on Peterhouse to exercise the Broker Option or to seek to procure subscribers for the Broker Option. Peterhouse may also, subject to prior consent of the Company, increase the amount of the Broker Option or allocate new Ordinary Shares after the time of any initial allocation to any person submitting a bid after that time.

The Broker Option Shares are not being made available to the public and none of the Broker Option Shares are being offered or sold in any jurisdiction where it would be unlawful to do so. No Prospectus will be issued in connection with the Broker Option.

To subscribe for Broker Option Shares, Existing Shareholders (who are qualifying) and other qualified investors should communicate their bid to Peterhouse via their stockbroker as Peterhouse cannot take direct orders from individual private investors. Existing Shareholders or other interested parties who wish to register their interest in participating in the Broker Option Shares should instruct their stockbroker to call Peterhouse on STX: 76086 or 020 7469 0938 or 020 7469 0936 or 020 7220 9797. Each bid should state the number of Broker Option Shares the Existing Shareholder wishes to subscribe for at the Issue Price.

Debt Conversion and Related Party Transaction

As part of the Placing, Magister have agreed to convert £200,000 of debt held by Magister in the Company into 20,000,000 new Ordinary Shares (the Conversion Shares) at the Issue Price and under the same terms as the Placing.

Further to the above, Magister have agreed to further convert an equal amount to that raised as part of the Broker Option under the same terms. The net effect of this potential further conversion, together with the receipt of the Conversion Shares, is to maintain Magister's shareholding in the Company at greater than 50%.

Magister is a Substantial Shareholder of the Company as defined by the AIM Rules for Companies (the "AIM Rules"), and is represented by Hamish Rudland and Gary Smith on the Board. In order to effect the Debt Conversion, an amendment to the conversion price mechanics governing the US$1.8m convertible facility that the Company entered into with Magister, as announced on 29 July 2022, is required. Effecting the Debt Conversion by Magister therefore constitutes a related party transaction under Rule 13 of AIM Rules. In this context, Caroline Havers, Neil Clayton and Sergio Zandamela (being the Directors on the Board who are considered to be independent of Magister) confirm, having consulted with the Company's nominated adviser, Strand Hanson Limited, that they consider that the terms of the Debt Conversion to be fair and reasonable insofar as its shareholders are concerned.

Broker Warrant

In connection with the Placing, Peterhouse will be granted warrants to subscribe for new Ordinary Shares in the capital of the Company, exercisable at the Issue Price (the "Broker Warrants"). The number of Broker Warrants granted to Peterhouse will be determined following the closing of the Broker Option. The Broker Warrants can be exercised for a period of 24 months from the date of Admission.

Admission to Trading

Application has been made to for the admission of 40,000,000 new Ordinary Shares (comprising 20,000,000 Placing Shares and 20,000,000 Conversion Shares) to trading on AIM ("Admission"), which is expected to occur at 8.00 a.m. on or around 23 March 2023. The new Ordinary Shares issued will rank pari passu with the Company's existing Ordinary Shares.

Total Voting Rights

Following Admission (and prior to the issue of any new Ordinary Shares pursuant to the Broker Option) the Company's enlarged issued share capital will be 61,240,618 Ordinary Shares. The Company holds no Ordinary Shares in Treasury. This figure of 61,240,618 Ordinary Shares may be used by shareholders in the Company as the denominator for the calculations by which they will determine if they are required to notify their interest in, or a change in their interest in, the share capital of the Company under the FCA's Disclosure Guidance and Transparency Rules.

** ENDS **

For further information please visit www.agriterra-ltd.com or contact: