Bezant Res Regulatory News (BZT)

Three JV Properties

Joint Venture ("JV") covers the Troulli, Kokkinapetra and Anglisides projects (as detailed in Bezant's announcement 26 August 2021), held by Caerus in Cyprus ("JV Properties")

Drilling has commenced on one property

The JV begins with immediate effect with the parties joint financial contribution being from the commencement of diamond drilling at Troulli on 16 September 2021

USD 1M exploration budget to be jointly funded

The Parties have committed an initial sum of USD1.0 million towards resource development and to take the Project to feasibility to be funded on a 50:50 basis

Caerus to manage exploration program

Caerus will manage the exploration and resource development phase of the program

Bezant responsibilities

Bezant will be responsible for;

a) project feasibility studies, and mine development; and

b) arranging funding and guarantees required by third party funders for plant and infrastructure funding to commence mining

Recovery of exploration costs

Direct exploration expenditure committed in getting to feasibility will be refunded from excess cash-flow in the ratio 70% to Caerus and 30% to Bezant

Distribution post exploration cost recovery

Once direct exploration expenditure has been refunded excess cash-flow will be shared in the ratio 80% to Bezant and 20% to Caerus

Option Agreement remains in force

The 18 month option agreement dated 30 July 2021 between Bezant and Caerus which commenced on 1 August 2021 to allow the parties to review Caerus extensive portfolio of copper / gold projects in Cyprus with a view to possible joint venture mining operations remains in force (the "Option Agreement").

1. Parties

(a) Caerus Mineral Resources Plc (registered in England with company number 11043077) whose registered office is at 25 Eccleston Place, London, England, SW1W 9NF (hereinafter referred to as "Caerus"); and

(b) Bezant Resources Plc (registered in England with company number 02918391) whose registered office is at Quadrant House Floor 6, 4 Thomas More Square, London, E1W 1YW (hereinafter referred to as "Bezant")

2. Joint Venture properties

The parties have selected the following three projects from those covered by the Option Agreement to be the subject of this joint venture agreement:

(a) Troulli Project comprising licences AE4662 together with a licence extension that has been submitted to the Mines Department for approval;

(b) Kokkinapetra Project comprising licence AE4644; and

(c) Angleside Project comprising licence AE4791

The "Joint Venture Properties"

3. Option Agreement

The Option Agreement remains in full force and effect and other properties covered by the Option Agreement may be added to this joint venture or form the basis of a further joint venture agreement.

4. Funding & budgets

(a) The parties have agreed to fund an exploration programme of USD1million on the Joint Venture Properties and each party shall subscribe USD500,000 with drawdowns being of the same amount and at the same time.

(b) Caerus will present to the technical committee for approval a budget for the USD1million expenditure, with proposed drawdowns to be agreed prior to any drawdown.

(c) Bezant will be responsible for arranging the funding of any scoping study and/or feasibility study to access project economics.

(d) For any project where a decision to mine has been made or is being contemplated Bezant will prepare a budget and a development build programme the financing of which will be sought and managed by Bezant.

5. Caerus Exploration Costs

(a) On a decision to mine, the exploration expenses of Caerus on the three projects the subject of this joint venture agreement (the "Caerus Exploration Expenditure") will be submitted to the technical committee and upon approval will be repaid from future operational cash flows.

(b) In calculating the Caerus Exploration Expenditure;

a. the commencement date will be 16 September 2021 the date at which the diamond drilling programme initially commenced; and

b. Caerus will include all direct cost in Cyprus, but not any corporate cost outside Cyprus

(c) The Caerus Exploration Expenditure will be refunded from excess operating cash flow from the month after commercial production is achieved - being 75% of the plant's nameplate capacity ("Commercial Production") ("Excess Cash")

(d) Where both parties have agreed to proceed with the mine development project then Caerus will be entitled to receive 70% of the Excess Cash and Bezant 30% of Excess Cash until Caerus has been fully repaid the Caerus Exploration Expenditure. Once the Caerus Exploration Expenditure has been fully repaid 80% of Excess Cash shall be paid to Bezant and 20% of Excess Cash to Caerus.

(e) If Caerus have made a decision not to proceed in relation to a mine development project then Caerus will be entitled to receive 30% of the Excess Cash and Bezant 70% of Excess cash until Caerus has been fully repaid the Caerus Exploration Expenditure. Once the Caerus Exploration Expenditure has been fully repaid 90% of Excess Cash shall be paid to Bezant and 10% of Excess Cash to Caerus.

6. Technical Committee

(a) A technical committee will be formed, consisting of two members from Caerus and two members from Bezant.

(b) During the exploration phase the Chairman will be a Caerus nominee, who shall not have the casting vote.

(c) On a decision to mine by the technical committee, then the Chair of the technical committee shall change to a Bezant nominee and Bezant will have management of the project from that stage.

7. Exploration Program

(a) The exploration programme shall be designed to pursue the spirit and intent of the Option Agreement, which is to identify a minimum of 40,000 tonnes of contained copper for development to produce a minimum of 5,000 tonnes per annum, for a minimum period of 8 years.

(b) Caerus are to be responsible for managing the exploration program approved by the Technical Committee.

8. Feasibility study

Bezant will based on exploration results present to the technical committee a feasibility study, which defines the key financial and operating parameters of any proposed mining operation.

9. Environmental issues

Both the parties will jointly be responsible for environmental and social responsibilities attached to any future mining project, with Caerus in particular being responsible for all governmental and municipal relationships in Cyprus.

10. Mining phase

Once a decision to mine has been made the mining will be conducted under the appropriate mining and industrial laws of Cyprus, Bezant will be appointed the operator, and Caerus will retain legal ownership rights of the Projects on behalf of the Joint Venture so the Joint Venture can conduct mining operations.

11. Security for External funding

(a) Caerus agree to provide the necessary property security guarantees and security and Bezant agrees to provide the plant and associated infrastructure security guarantees, required by any third-party lender.

(b) Before entering into any third-party finance agreements, Bezant and Caerus will agree the terms and any security to be provided.

12. Caerus agreement with Jubilee

In the event that any plant to be constructed falls within the Option Agreement between Caerus and Jubilee Metals Group Plc (the "Existing Jubilee Option Agreement") , then both Caerus and Bezant will subordinate there interests under this joint venture agreement to the 15% free participation under the Existing Jubilee Option Agreement. Both parties acknowledge that under the Existing Jubilee Agreement Jubilee has the first right of funding and the joint venture will recognise this right and Jubilee will have 30 days to match any offer of funding from a third party.

13. Sale to third party

(a) In the event that exploration drilling and a feasibility study identifies a project, which could be of interest to. third party to develop then the parties agree that any benefits derived from sale shall be split on an equal basis with each party recovering its sunk cost incurred from 16 September 2021 before equally dividing the balance between the two parties.

(b) Each party agrees to come along, tag along with the other on receipt of a third party offer, which is deemed satisfactory to the technical committee and to work together to enter into a purchase and sale agreement within 15 days of approval by the technical committee.

14. No commitment to mine

Bezant makes no representation or commitment to develop a mine and will only progress to the development of a mine if in their opinion the in-situ or primary material fulfil their requirements for investment.

15. English law

The agreement is subject to English Law

Bezant Resources Plc 

Colin Bird Executive Chairman

Beaumont Cornish (Nominated Adviser) Roland Cornish 

+44 (0) 20 7628 3396

Novum Securities Limited (Broker)

Jon Belliss

+44 (0) 20 7399 9400