MTR.L Regulatory News (MTR)

26 July 2019

Metal Tiger plc

("Metal Tiger" or the "Company")

Term Sheet signed with Cobre Pty Ltd and Issue of Equity

Metal Tiger plc (AIM:MTR), the London Stock Exchange AIM listed investor in strategic natural resource opportunities, is pleased to announce that it has entered into a binding term sheet (the "Term Sheet") with privately-owned Australian copper exploration company, Cobre Pty Ltd ("Cobre"), which recently successfully acquired 80% of Toucan Gold Pty Ltd ("Toucan"), which holds 100% of the Perrinvale Copper Project ("Perrinvale" or the "Project") in central Western Australia.

Highlights:

·; MTR has executed the Term Sheet, which, subject to the satisfaction of certain conditions precedent, will allow MTR to invest an initial A$500,000 for approximately 15% of Cobre and a further A$2,000,000 as part of an IPO fundraise, expected to complete within the next 12 months, to achieve an approximate aggregate 19.99% shareholding upon listing.

·; MTR has issued Cobre 1,658,720 new ordinary shares of 0.01 pence each in the capital of the Company ("Ordinary Shares") at a price of 1.45 pence per share (the "MTR Shares") in consideration for Cobre granting MTR an exclusivity period of 30 days in which to complete due diligence and implement formal documentation;

o MTR has already completed a substantial amount of due diligence and is pleased to obtain exclusivity given the strong level of interest in the market to invest in the Project.

·; On completion of an IPO, MTR will obtain a right to appoint a nominee director to the Board of the Cobre IPO entity.

·; Circa 1,000m RC drilling programme at Perrivale intersected very high grade volcanogenic massive sulphide (VMS) base metal and gold mineralisation at shallow depth;

o The best assayed result was 5m @ 9.8% Cu, 3.2g/t Au, 34g/t Ag, 3.1% Zn.

·; Preliminary ground EM survey completed at Perrinvale.

A link to the Cobre Investor Memorandum can be found at the following link:

https://bit.ly/2Yqc7g4

Michael McNeilly, Chief Executive Officer of Metal Tiger, commented:

"We are delighted to enter into this term sheet with Cobre that provides the framework for a near-term investment in Cobre. As a Board, we are truly excited by the encouraging results achieved by Cobre to date as well as by the strong interest that has been shown in the Project. Discovering a potential high-grade VMS system is a major credit to the team at Cobre. Furthermore, the potential exists on the tenement package for an extended VMS system across a large proportion of the tenements. Such deposits are rare globally, so to encounter one in a stable jurisdiction like Australia is significant.

It is a testament to the Metal Tiger team and investment approach that we have managed to secure this term sheet and we look forward to working hard to complete our due diligence, agree definitive documents and complete the investment."

Project Background

Cobre is the 80% owner of Toucan which holds a group of tenements consisting of the Perrinvale Copper Project, covering 382km2 of the Panhandle and Illaara Greenstone Belts in Western Australia. The Perrinvale Project was previously owned by Fortescue Metals Group ("FMG") and includes three prospects called Schwabe, Zinc Lago and Ponchiera, over which FMG retains a 2% net smelter royalty on future copper production. The Project area is located around Lake Barlee, which is NW of Menzies and Kalgoorlie, and directly adjacent to the Goldfields Highway.

Historical exploration work was initially focussed on known gold mineralisation in the area. However, a detailed review of the historical work and ground reconnaissance suggested that part of the Project area was highly prospective for base metals as well. Under the acquisition terms, Cobre provided funds to Toucan to undertake the initial ground EM geophysical surveys and preliminary RC drilling in exchange for 80% of Toucan and 20% of Cobre's equity.

During March 2019, Cobre and Toucan undertook a preliminary ground electromagnetic (EM) survey of the Perrinvale tenements. This was followed by a circa 1,000m reverse circulation (RC) drilling programme in June 2019, which intersected very high-grade volcanogenic massive sulphide (VMS) base metal and gold mineralisation at shallow depth.

Ground EM geophysical survey

Base metal potential in the Lake Barlee area was first recognised in the early 1970s, but Cobre believes that such potential has been overlooked by subsequent explorers. At that time, ground magnetics and early IP technology were the geophysical tools applied. Today, however, EM survey technology is considered the primary geophysical tool used for VMS exploration. Cobre worked with Newexco Services Pty Ltd, to conduct a first pass ground EM geophysical survey, which was completed in March 2019 over parts of the Project area, which Cobre believed to be favourable for VMS exploration. This analysis identified eight widely-spaced conductors up to 3km long that could be associated with VMS mineralisation.

Preliminary RC drilling

Three of the conductors were drilled in June 2019 in a preliminary exploration programme. The primary objective was to confirm the copper and zinc mineralisation reported in the early 1970s at the Schwabe prospect, which contains a copper gossan extending over 140m at surface. In total, four areas were drilled, being the Schwabe prospect plus three greenfield areas identified by the EM analysis. Two holes were drilled at Schwabe to depths of 90m depth and 200m respectively, with 1m sample intervals. Assays are available for two holes so far and both intersected massive sulphides at approximately 50m depth, implying the presence of a VMS system.

The proposed next steps in Cobre's identified work programme are to assay the remaining RC drill holes completed to date and commence downhole EM to further define secondary drill targets.

Pre-IPO and IPO Cornerstone Term Sheet

Subject to the Conditions Precedents (described in more detail below) being met, MTR has agreed to make an initial payment of A$500,000 to Cobre in consideration for being issued with 6.6 million new ordinary shares (the "Initial Securities") in the capital of Cobre at an issue price of A$0.076 per security, which will represent approximately 15% of the issued share capital of Cobre (assuming no other Cobre ordinary shares are issued in the interim).

In addition, subject to the Conditions Precedent being met, MTR agrees to subscribe for, and Cobre (or its listed nominee) (the "Cobre IPO Entity") agrees to issue up to 10,000,000 new ordinary shares in the capital of the Cobre IPO Entity at an issue price of A$0.20 per share (the "IPO Shares") under the proposed initial public offer of IPO Shares in conjunction with an application for the quotation of those IPO Shares on a recognised stock exchange (including the ASX), provided that the offer period for the IPO commences within 12 months after the date on which the Term Sheet is executed (or such later date as agreed between the parties in writing).

A condition of the issue of the IPO Shares is that MTR will hold 19.99% of the ordinary shares in the Cobre IPO Entity and will not be required to pay more than A$2,500,000 (in aggregate) pursuant to the subscription for the Initial Securities and IPO Shares. Cobre will commit to do all things necessary to meet this condition.

Should the IPO occur within 12 months of the execution of the term sheet and should MTR not invest the proposed A$2,000,000 for the IPO Shares, then the Initial Securities will be forfeited and cancelled for no consideration by appropriate means.

As a condition of the issue of the IPO Shares (and subject to applicable laws and the ASX Listing Rules), MTR will be entitled to nominate a director to the Board of the Cobre IPO Entity, with the details of such nominated director to be included in the IPO prospectus.

Should Cobre raise more than A$700,000 by way of equity investment, including by way of an issue of convertible securities from any person other than MTR before the IPO then the Initial Securities cannot be redeemed or cancelled. Any equity investment before IPO will not impact MTR's right to hold 19.99% of Cobre following an IPO for a total investment in aggregate of A$2,500,000.

If an agreement is made before the IPO to sell all or the majority of the assets of Cobre, MTR will be given the right to require that all of the Initial Securities held by it are redeemed (by way of buy back or otherwise) for fair market value as determined (based on the price at which the assets are sold but only where the assets are sold to a bona fide third party on arm's length terms). In the event that all of the shares in Cobre are sold, Cobre must be given the right to require that all of the Initial Securities held by MTR are redeemed, by way of buy back or otherwise at a price per security equal to the sale price per security agreed with the third party purchaser on arm's length terms or if Cobre does not exercise the right then MTR's Initial Securities will be subject to drag and tag rights. However, Cobre cannot redeem the Initial Securities if the sale price with the bona fide third party is less than the amount initial subscription price paid by MTR.

Conditions Precedent

The transaction is conditional upon:

·; MTR conducting due diligence on Cobre to its satisfaction;

·; The parties agreeing a formal subscription agreement documenting the issue of the Initial Securities within 30 days after the date on which this Term Sheet is executed and proceeding to financial close within seven days after executing the subscription agreement (or such other date as agreed between the parties); and

·; Receipt of any waivers and approvals in relation to the transaction that Cobre or MTR considers necessary under Cobre's constitution or the Corporations Act 2001 (Cth) or any other law.

(together, the "Conditions Precedent").

Each party must use their best endeavours to ensure that the Conditions Precedent are satisfied as soon as possible.

Exclusivity

In consideration for the issue of the MTR Shares to Cobre, Cobre agrees not to directly or indirectly, negotiate with, solicit offers from, or provide any information to any potential third party investors, or enter into any discussions, negotiations, agreements or understandings concerning any potential investment in Cobre by any third parties, other than MTR, for a period of 30 days after the date on which this Term Sheet is executed or any longer period agreed between the parties in writing for the purposes of finalising the formal subscription agreement.

Admission and total voting rights

Application will be made to the London Stock Exchange for the admission to trading on AIM of the MTR Shares ("Admission"). Admission is expected to occur on or around 2 August 2019.

Following the Admission of the MTR Shares, the number of Ordinary Shares in issue in the Company will increase to 1,559,172,297. For the purposes of the Financial Conduct Authority's Disclosure and Transparency Rules ("DTRs"), the issued ordinary share capital of Metal Tiger following Admission will consist of 1,559,172,297 Ordinary Shares with voting rights attached (one vote per Ordinary Share). There are no Ordinary Shares held in treasury. This total voting rights figure may be used by shareholders as the denominator for the calculation by which they will determine whether they are required to notify their interest in, or a change to their interest in, Metal Tiger under the DTRs.

For further information on the Company, visit: www.metaltigerplc.com:

Notes to Editors:

Metal Tiger plc is listed on the London Stock Exchange AIM Market ("AIM") with the trading code MTR and invests in high potential mineral projects with a base, precious and strategic metals focus.

The Company's target is to deliver a high return for shareholders by investing in significantly undervalued and/or high potential opportunities in the mineral exploration and development sector. The Company's key strategic objective is to ensure the distribution to shareholders of major returns achieved from disposals. Metal Tiger has two investment divisions: Direct Equities and Direct Projects.

The Direct Equities division invests in undervalued natural resource companies listed on AIM, the ASX and the TSX, which includes its 10.48% interest in MOD Resources Limited ("MOD"). Through the trading of equities and warrants, Metal Tiger seeks to generate cash for investment in the Direct Projects division.

Metal Tiger's Direct Projects division is focused on the development of its key project interests in Botswana, Spain and Thailand. In Botswana, Metal Tiger, through its JV with MOD and its interest in Kalahari Metals Limited, has a growing interest in the large and highly prospective Kalahari copper/silver belt. In Spain, the Company has tungsten and gold interests in the highly mineralised Extremadura region. In Thailand, Metal Tiger has interests in two potentially near-production stage lead/zinc/silver mines as well as licences, applications and critical historical data covering antimony, copper, gold, lead, zinc and silver opportunities.

The Company actively assesses new investment opportunities on an on-going basis and has access to a diverse pipeline of new opportunities in the natural resources and mining sectors. For pipeline opportunities deemed sufficiently attractive, Metal Tiger may invest in the project or entity by buying publicly listed shares, by financing privately and/or by entering into a joint venture.