Beowulf Regulatory News (BEM)

THIS ANNOUNCEMENT IS FOR INFORMATION PURPOSES ONLY AND DOES NOT CONSTITUTE OR CONTAIN ANY INVITATION, SOLICITATION, RECOMMENDATION, OFFER OR ADVICE TO ANY PERSON TO SUBSCRIBE FOR, OTHERWISE ACQUIRE OR DISPOSE OF ANY SECURITIES IN BEOWULF MINING PLC OR ANY OTHER ENTITY IN ANY JURISDICTION. NEITHER THIS ANNOUNCEMENT NOR THE FACT OF ITS DISTRIBUTION, SHALL FORM THE BASIS OF, OR BE RELIED ON IN CONNECTION WITH ANY INVESTMENT DECISION IN RESPECT OF BEOWULF MINING PLC.

The information contained within this announcement is deemed to constitute inside information as stipulated under the Market Abuse Regulation ("MAR") (EU) No. 596/2014, as incorporated into UK law by the European Union (Withdrawal) Act 2018. Upon the publication of this announcement, this inside information is now considered to be in the public domain.

20 December 2022

Beowulf Mining plc

("Beowulf" or the "Company")

Intention to conduct a preferential rights issue of SDRs in Sweden and a UK retail offer of ordinary shares - Partially secured capital raise up to approximately SEK 112 million (approximately £8.8 million) - Funding to progress at pace the development of Kallak

Beowulf (AIM: BEM; Spotlight: BEO), the mineral exploration and development company, announces its intention to undertake, in the first quarter of 2023, a preferential rights issue of Swedish Depository Receipts ("SDRs") with a PrimaryBid retail offer of ordinary shares of 1 pence each in the capital of the Company ("Ordinary Shares") in the UK. The SDRs represent interests in Ordinary Shares and the preferential rights issue of SDRs will amount to approximately SEK 85 million (approximately £6.7 million) before deduction for transaction related costs (the "Rights Issue"). The PrimaryBid retail offer of Ordinary Shares in the UK, will amount to a maximum of approximately SEK 27 million (approximately £2.1 million) before deduction for transaction related costs (the "UK Issue" and, together with the Rights Issue, the "Capital Raise").

Beowulf has received underwriting commitments for the Rights Issue which in aggregate amount to maximum SEK 60 million (approximately £4.7 million), or approximately 70 per cent of the Rights Issue. In addition, members of the Board of Directors and executive management have declared their intention to subscribe in the Capital Raise in aggregate of equivalent approximately SEK 2 million (approximately £150,000).

The formal decision to execute the Capital Raise as well as an announcement of its full terms and conditions, inter alia, the proposed subscription price, the number of SDRs and Ordinary Shares to be offered and the proposed timeline, is planned for January 2023 with the subscription period expected to be during February 2023.

In order to complete the Capital Raise without unnecessary delay, an Extraordinary General Meeting ("EGM") is planned to be held in January 2023, the purpose of which is to seek an increase in the authorities granted at the 2022 Annual General Meeting to issue securities in the Company to ensure that the Board of Directors has the requisite authorisation and flexibility to increase the Company's share capital, as needed. A further announcement will be made regarding the details of the EGM.

Summary

· The Board of Directors of Beowulf announces its intention to undertake a preferential rights issue of SDRs and a PrimaryBid retail offer of Ordinary Shares in the UK in the aggregate total of up to the equivalent of approximately SEK 112 million (approximately £8.8 million).

· The Rights Issue will be equivalent to approximately SEK 85 million (approximately £6.7 million) before deduction for transaction related costs.

· The main purpose of the Rights Issue will be to finance the continued development of the Kallak North Iron Ore Project ("Kallak North") in Norrbotten County in northern Sweden, including completion of the ongoing scoping study in January 2023, as well as to progress at pace the preparation of the environmental permit application for Kallak North, and with sufficient funding resource drilling for Kallak South.

· The UK Issue will be proportionate in volume to the Rights Issue and will be equivalent to a maximum of approximately SEK 27 million (approximately £2.1 million) before deduction for transaction related costs.

· The Company values its UK investor base and therefore the purpose of the UK Issue will be to allow existing holders of Ordinary Shares ("Shareholders"), along with private and other investors, the opportunity to participate in the Capital Raise, as well as to provide additional working capital in support of the Company's ongoing projects.

· Beowulf has secured underwriting commitments which, subject to customary conditions, in aggregate, amount to maximum SEK 60 million (approximately £4.7 million), corresponding up to approximately 70 per cent of the Rights Issue.

· Members of the Board of Directors, executive and senior management (including the Company's Chairman and CEO) have declared their intentions to subscribe in the Capital Raise in aggregate of equivalent approximately SEK 2 million (approximately £150,000).

· The formal decision to execute the Capital Raise as well as an announcement of its full terms and conditions, inter alia, the proposed subscription price, number of SDRs and Ordinary Shares to be offered and the proposed timeline, is planned for January 2023. The subscription price in the Capital Raise will be determined by the Board of Directors in consultation with its advisors in accordance with relevant market conditions and is planned to be based upon a discount customary in the Swedish market to the average daily weighted average price for the SDRs and the Ordinary Shares during a trading period of maximum 15 days prior to the resolution by the Board of Directors.

· A prospectus for the Rights Issue will be published ahead of the subscription period, which is intended to take place in February 2023 for both the Rights Issue and the UK Issue.

· In order to complete the Capital Raise without unnecessary delay, an EGM is planned to be held in January 2023, the purpose of which is to seek an increase in the authorities granted at the 2022 Annual General Meeting to issue securities in the Company to ensure that the Board of Directors has the requisite authorisation and flexibility to increase the Company's share capital, as needed. A further announcement will be made regarding the details of the EGM.

Background and motive

Beowulf is a Europe-focused developer of primary raw materials, such as iron ore and graphite, critical to Europe's green transition. Beowulf operates through its subsidiaries Jokkmokk Iron Mines AB ("Jokkmokk Iron") active in Sweden and Grafintec Oy ("Grafintec") active in Finland and through 59.5 per cent. owned Vardar Minerals Limited ("Vardar") active in Kosovo.

In March 2022, Jokkmokk Iron was granted a mining concession for the Kallak North iron ore deposit in Norrbotten County in northern Sweden. Kallak North is Beowulf's most advanced project, and the Company's top priority. The main objective for Jokkmokk Iron is to become a supplier of world class, net zero CO2 emission iron ore concentrates for developing green steel producers in the Nordic region.

Next value inflection points for Kallak North includes the near completion of the scoping study in January 2023, and application for the environmental permit, which is planned to be submitted in Q4 2023. As additional Exploration Targets have been identified within the Company's surrounding Kallak permits, continued exploration could come to conclude that these targets contain economic mineralisation. A future agreement with a green steel producer is another possible value driver.

In Finland, Grafintec is developing an inventory of natural flake graphite, offering sustainable and secure supply of a primary raw material critical to Europe's rapidly expanding lithium-ion battery market. Grafintec's most important breakthrough during 2022 is the Memorandum of Understanding between Grafintec and Qingdao Hensen Graphite Ltd. The companies will work together to establish an anode materials hub in Finland. Current and future workstreams will focus on development of the Aitolampi graphite resource, and exploration of Grafintec's portfolio of permits.

In Kosovo, Vardar's work is focused on making a discovery and has largely been focused on the base and precious metals evident at the Mitrovica licence. Recent result shows promising possibilities for economic mineralisation in the Majdan Peak and Red Lead exploration targets, containing led, zinc, copper, silver and gold. Vardar's recent expansion of its licence position has established a dominant land holding in the highly prospective areas surrounding the Stan Terg lead-zinc-silver mine.

The main purpose of the Rights Issue will be to finance the continued development of Kallak North, including completion of the ongoing scoping study in January 2023, as well as to progress at pace the preparation of the environmental permit application for Kallak North. The Rights Issue will also repay bridge loan financing and with sufficient funding available, possible resource drilling for Kallak South, and capital for continued development of Grafintec and Vardar's exploration programme.

Kurt Budge, Chief Executive Officer of Beowulf, commented:

"Beowulf has made significant progress this year in all its business areas.

"The award of the Exploitation Concession for Kallak North in March 2022 was a major milestone for the Company, and we have since strengthened our leadership team, with first the appointment of Ulla Sandborgh as CEO Jokkmokk Iron and the appointment of Johan Röstin as Chairman of Beowulf.

"Ulla is leading our efforts towards our goal of bringing the Kallak North mine into production in 2026. On 11 December, a public meeting was held in Jokkmokk and Ulla presented the Company's ambitions for sustainable development, timeline, description of coming investigations and collaboration with the society. The day after, Ulla and Johan met with the Governor of Norrbotten County and her team and discussed the environmental permit process.

"Our main focus is to submit the environmental permit application in Q4 2023. Processes and investigations required to ensure the application is the best it can be are intensive, which means we need to strengthen our cash position.

"At the same time, we have had very exciting developments in all the companies of the Group. In Kosovo, Vardar has delivered tremendous exploration success, with the discovery of an epithermal polymetallic system at Majdan Peak, new exploration targets at Majdan Peak South, and most recently at Red Lead. While in Finland, Grafintec entered into a Memorandum of Understanding with Qingdao Hensen Graphite Ltd to work together to establish an anode materials hub in Finland and has been exploring for more natural flake graphite to increase its resources.

"With activity across the Group and businesses that are well positioned to supply raw materials critical for the transition to a Green Economy in the Nordics and Europe, we are excited for what we can deliver in 2024."

Use of proceeds

The current working capital is not sufficient to maintain the planned pace for the Kallak project or Beowulf's other operations in Finland and Kosovo for the next twelve-month period. In order to provide the Company with additional working capital, the Board of Directors intends to formally resolve and conduct the Capital Raise during Q1 2023.

The Rights Issue can provide the Company with the equivalent of up to approximately SEK 85 million before deduction of transaction related costs and compensation to underwriters (see "Commitments in relation to the Capital Raise" below). The UK Issue amounts to equivalent maximum SEK 27 million before deductions for transaction related costs. If the Capital Raise is fully subscribed, the Company can be provided with the equivalent of up to approximately SEK 112 million before deduction of transaction related costs and compensation to underwriters.

With the net proceeds, the Company intends to finance the following activities in summary:

· Kallak Iron Ore Project workstreams including scoping study completion, environmental permitting, resource drilling to expand the size and potential mine life, and stakeholder engagement.

· Grafintec workstreams including development of a downstream anode materials hub, including pre-feasibility study, environmental permitting, optimisation of Aitolampi as a potential graphite source for downstream processing, and Rääpysjärvi exploration.

· Repayment of the short-term debt which was raised in July 2022.

In the event that the Capital Raise is fully subscribed, the Board of Directors assesses that the working capital will cover the Company's operations for at least 18 months. In a scenario where the Rights Issue is subscribed to the secured level of 70 per cent and no further funds are provided in the UK Issue, the Board of Directors assesses that the available working capital will cover the Company's operations for the upcoming twelve-month period after completion of the intended Capital Raise.

Commitments in relation to the Capital Raise

Beowulf has received underwriting commitments from the Nordic investors Formue Nord Markedsneutral A/S and Buntel AB (a subsidiary to Modelio Equity AB (publ)). The underwriters have committed to the Company to the extent that SDRs in the Rights Issue are not subscribed up to 70 per cent, to subscribe for the amount of SDRs required for the Rights Issue to be subscribed up to 70 per cent, provided that the total underwritten amount does not exceed SEK 60 million. Subscription of SDRs according to the underwriting commitments shall be carried out to the subscription price in the Rights Issue.

In addition, members of the Board of Directors and executive management (including the Company's Chairman and CEO) have declared their intention to subscribe in the Capital Raise in aggregate equivalent to approximately SEK 2 million.

A cash compensation of 12 per cent. of the underwritten amount is payable by the Company to the underwriters after completion of the Rights Issue. The underwriters have the option to request that the compensation is received in new SDRs in the amount of 14 per cent. of the underwritten amount or as a combination of cash and SDRs. If compensation is to be received in SDRs the Company will conduct a placing of new additional SDRs to the underwriters, after completion of the Rights Issue, at the same subscription price as in the Rights Issue. No compensation will be paid for the declared intentions of subscription by the Board of Directors and executive management. The underwriting commitments and the declared intentions are not secured via bank guarantee, pledging or similar arrangements. If the Board of Directors has not resolved to execute the Capital Raise by 28 February 2023, then the Company is liable to 50 per cent. of the cash compensation due to the underwriters.

Formue Nord Markedsneutral A/S may offset payment for any SDRs subscribed for in the Rights Issue pursuant to its underwriting commitment against a bridge loan made to the Company in July 2022.

Timetable for the Capital Raise and additional information

The formal decision to execute the Capital Raise as well as an announcement of its full terms and conditions, inter alia, the proposed subscription price, number of SDRs and Ordinary Shares to be offered and the proposed timeline, is planned for January 2023. The subscription price in the Capital Raise will be determined by the Board of Directors in consultation with its advisors in accordance with relevant market conditions and is planned to be based upon a discount customary in the Swedish market to the average daily weighted average price for the SDRs and the Ordinary Shares during a trading period of maximum 15 days prior to the resolution by the Board of Directors. The subscription period for both the Rights Issue and the UK Issue is intended to take place in February 2023.

A prospectus related to the Rights Issue containing the full terms and conditions and instructions on subscription and payment will be made available together with other investor material before the subscription period commence on Beowulf's website, https://beowulfmining.com/, as well as on Sedermera Corporate Finance AB's website, www.sedermera.se.

The Company values its UK investor base and therefore the purpose of the UK Issue will be to allow Shareholders, along with private and other investors, the opportunity to participate in the Capital Raise.

Once announced, Shareholders and other investors will be able to access the UK Issue by visiting www.PrimaryBid.com and downloading the PrimaryBid mobile app available on the Apple App Store and Google Play. Shareholders and other investors may also be able to take part through PrimaryBid's extensive network of retail brokers, wealth managers and investment platforms. Subscriptions through these partners can be made from tax efficient savings vehicles such as ISAs or SIPPs, as well as General Investment Accounts (GIAs);

For further details of how to register with PrimaryBid, please refer to the PrimaryBid website at www.PrimaryBid.com. The terms and conditions on which the UK Issue will be made, including the procedure for application and payment for new Ordinary Shares, will be available to all persons who register with PrimaryBid.

Extraordinary General Meeting

In order to complete the Capital Raise without unnecessary delay, an EGM is planned to be held in January 2023, the purpose of which is to seek an increase in the authorities granted at the 2022 Annual General Meeting to issue securities in the Company to ensure that the Board of Directors has the requisite authorisation and flexibility to increase the Company's share capital, as needed.

A further announcement will be made regarding the details of the EGM.

Year-end report

In order to enable board members, members of the executive management team and other insider individuals to participate in the Capital Raise, the Company plans to advance the publication date for the year-end report of 2022. An exact publication date will be communicated at a later time.

Advisers

In relation to the Rights Issue, the Company has engaged Sedermera Corporate Finance AB as Swedish financial adviser, Bird & Bird Advokat KB as Swedish legal advisor and Nordic Issuing AB as Swedish issuing agent. Shark Communication AB assists the Company with advice regarding communication.

Enquiries:

Beowulf Mining plc

Kurt Budge, Chief Executive Officer, Tel: +44 (0) 20 7583 8304

Sedermera Corporate Finance AB

Tel: +46 (0) 40-615 14 10

SP Angel Corporate Finance LLP

Ewan Leggat / Stuart Gledhill / Adam Cowl

Tel: +44 (0) 20 3470 0470

Bird & Bird Advokat KBTel: +46 (0)8 506 320 00

BlytheRayTim Blythe / Megan Ray Tel: +44 (0) 20 7138 3204

Cautionary Statement

Statements and assumptions made in this document with respect to the Company's current plans, estimates, strategies and beliefs, and other statements that are not historical facts, are forward-looking statements about the future performance of Beowulf. Forward-looking statements include, but are not limited to, those using words such as "may", "might", "seeks", "expects", "anticipates", "estimates", "believes", "projects", "plans", strategy", "forecast" and similar expressions. These statements reflect management's expectations and assumptions in light of currently available information. They are subject to a number of risks and uncertainties, including, but not limited to , (i) changes in the economic, regulatory and political environments in the countries where Beowulf operates; (ii) changes relating to the geological information available in respect of the various projects undertaken; (iii) Beowulf's continued ability to secure enough financing to carry on its operations as a going concern; (iv) the success of its potential joint ventures and alliances, if any; (v) metal prices, particularly as regards iron ore. In the light of the many risks and uncertainties surrounding any mineral project at an early stage of its development, the actual results could differ materially from those presented and forecast in this document. Beowulf assumes no unconditional obligation to immediately update any such statements and/or forecasts.

Disclaimer

Sedermera Corporate Finance AB is acting as the Swedish financial adviser and broker to the Company in relation to the Rights Issue. Nordic Issuing AB is providing issuing services for the Rights Issue. Shark Communication AB has assisted the Company in the preparation of this announcement. The Directors are responsible for the contents of this announcement and Sedermera Corporate Finance AB, Nordic Issuing AB and Shark Communication AB disclaim all responsibility in relation to Shareholders and SDR Holders and for other direct or indirect consequences as a result of investment decisions or other decisions based on the information in this announcement.

Apart from the responsibilities and liabilities, if any, which may be imposed on Sedermera under the Swedish Securities Markets Act (Swedish: lagen (2007:528) om värdepappersmarknaden) or under the regulatory regime of any jurisdiction where exclusion of liability under the relevant regulatory regime would be illegal, void or unenforceable, neither Sedemera, nor any of its affiliates, accepts any responsibility whatsoever for the contents of this announcement including its accuracy, completeness and verification or for any other statement made or purported to be made by it, or on its behalf, and nothing in this announcement is or shall be relied upon as a promise or representation in this respect, whether as to the past or future. Sedermera and its affiliates accordingly disclaim, to the fullest extent permitted by applicable law, all and any liability whether arising in tort, contract or otherwise (save as referred to above) which they might otherwise be found to have in respect of this announcement or any such statement. No representation or warranty express or implied, is made by Sedermera or any of its affiliates as to the accuracy, completeness, verification or sufficiency of the information set out in this announcement , and nothing in this announcement will be relied upon as a promise or representation in this respect, whether or not to the past or future.