GCM Resources Regulatory News (GCM)

23 January 2020

GCM Resources plc

("GCM" or the "Company")

(AIM:GCM) 

Share issue - Consultants

GCM Resources plc, an AIM quoted mining and energy company, announces the issuance of new ordinary shares of 10 pence each in the capital of the Company ("Ordinary Shares") as payment of consulting fees in accordance with the consultancy agreement announced on 26 October 2018, with Dyani Corporation Limited ("Dyani") (the "Dyani Agreement"), and in accordance with the consultancy agreement announced on 4 September 2019, with DG Infratech Pte Ltd ("DG") (the "DG Agreement") (together, the "Agreements").

The Agreements provide that new Ordinary Shares would be awarded to Dyani and DG in the event that certain key milestones were reached in respect of formally securing the interest of Chinese State-owned enterprises to partner in the Phulbari Coal and Power Project. Details of these milestones are set out in the Company's announcements dated 26 October 2018 with respect to the Dyani Agreement and 4 September 2019 with respect to the DG Agreement.

Accordingly, the following consulting fees will be settled via the issuance of new Ordinary Shares:

·; in lieu of the retainer fee for the period from 1 April 2018 to 30 June 2018, the Company will issue 300,000 new Ordinary Shares to Dyani in accordance with the terms of the previous Dyani consultancy agreement, announced on 18 May 2017;

·; in lieu of the retainer fee for the period from 1 July 2018 to 30 June 2019, the Company will issue 2,142,856 new Ordinary Shares to Dyani;

·; for the negotiation and finalisation of the MOU with Power Construction Corporation of China, Ltd ("PowerChina") for power plants generating up to 4,000MW, as announced on 27 November 2018, a success fee will be awarded to Dyani, to be satisfied by the issue of 3,928,546 new Ordinary Shares;

·; for the negotiation and finalisation of definitive agreements with PowerChina in respect of power plants generating up to 2,000MW, as announced on 17 January 2019, a success fee will be awarded to Dyani, to be satisfied by the issue of 7,149,954 new Ordinary Shares; and

·; in lieu of the retainer fee for the period from 1 September 2019 to 30 November 2019, the Company has issued 199,998 new Ordinary Shares to DG, in accordance with the terms of the DG Agreement.

GCM confirms that following the issue of new Ordinary Shares set out above, Dyani will be interested in 28.7% of the Company's enlarged issued ordinary share capital.

In addition, Dyani is entitled to an additional 3,278,765 new Ordinary Shares for the negotiation and finalisation of the second Joint Venture Agreement with PowerChina, in respect to two plants of 1,000MW each, as announced on 15 March 2019 (the "Additional Shares"). This issuance has been deferred in accordance with the provisions of Dyani Agreement, whereby Dyani's aggregate shareholding is restricted from exceeding 30% of the Company's issued share capital, as the issuance of these Additional Shares would take Dyani's interest in the Company to 30.7%.

Under the terms of the Dyani Agreement, Dyani will be restricted from disposing of the new Ordinary Shares issued in satisfaction of the success fees for a period of six months from the date of issue. There are no restrictions on disposal of the shares issued in respect of the retainer fees issued to either Dyani or DG, which are intended to the respective consultants' costs in performing their services.

Application will be made to the London Stock Exchange for, in aggregate, 13,721,354 new Ordinary Shares to be admitted to AIM ("Admission"). It is expected that Admission will become effective on 27 January 2020. Following Admission, the Company's enlarged issued share capital will comprise 112,360,009 Ordinary Shares with voting rights in the Company. As the Company holds no shares in treasury, this is the total number of the voting rights in the Company which may be used by shareholders as the denominator for the calculations by which they will determine if they are required to notify their interest, or a change in the interest, in the share capital of the Company under Chapter 5 of the FCA's Disclosure Guidance and Transparency Rules as reflected in the Company's articles of incorporation.

This announcement contains inside information as defined in Article 7 of the EU Market Abuse Regulation No 596/2014 and has been announced in accordance with the Company's obligations under Article 17 of that Regulation.

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About GCM Resources

GCM Resources plc (LON:GCM), the AIM listed mining and energy company, has identified a high quality coal resource of 572 million tonnes (JORC 2004 compliant) at the Phulbari Coal and Power Project (the "Project") in north-west Bangladesh.

Utilising the latest highly energy efficient power generating technology the Phulbari coal mine is capable of supporting power plants of up to 6,000MW. GCM is awaiting approval from the Government of Bangladesh to develop the Project. The Company has a strategy of combining the Company's mine proposal with up to 6,000MW of power generation, together with credible, internationally recognised strategic partners. GCM aims to deliver a practical power solution to provide the cheapest electricity in the country, in a manner amenable to the Government of Bangladesh.