PATH.L Regulatory News (PATH)

7 July 2020

Path Investments plc

("Path" or the "Company")

Update on Acquisition of DT Ultravert and Kansas Nitrogen Reserves

Path Investments plc (TIDM: PATH), the energy and natural resources investment company, is pleased to provide an update on the progress of its agreement with Zoetic International PLC ("Zoetic"), to acquire its 75% ownership of its patented proprietary technology, DT Ultravert ("DTU"), and the acquisition of its Kansas Nitrogen Reserves, its associated leases and equipment (together the "Transaction").

Further to the announcement dated 22 June 2020, Path has held a number of discussions with the Financial Conduct Authority ("FCA"). The result of those discussions is that it has been concluded that the Transaction is a reverse takeover under the Listing Rules and the current suspension on the Standard Segment of the Official List and on the Main Market of the London Stock Exchange will continue pending publication of a prospectus. The process of producing the required prospectus is underway and on publication of a prospectus the existing listing will be cancelled and the Ordinary Shares re-admitted to trading ("Readmission").

Following further discussions with Zoetic, the consideration for the Transaction has been slightly adjusted. This will now be satisfied by the issue by Path to Zoetic of 15,000,000 warrants to subscribe for ordinary shares in Path at any time from the first to the third anniversaries following completion at an exercise price of 0.75 pence per share, together with 15,000,000 warrants to subscribe for ordinary shares in Path at any time from the first to the third anniversaries following completion at an exercise price of 1.5 pence per share.

Additionally, Path has agreed to pay, in perpetuity, to Zoetic a royalty equal to 6% of all gross revenues derived from DTU, accruing from receipt of first revenues, although not payable until 12 months thereafter. Royalty payments will be settled quarterly, with payments being made at the end of the quarter in which Path earns revenue. For the avoidance of doubt, Path has no obligation to make a payment to Zoetic unless it has received the revenue payment from its own customers. Royalty payments due until the fifth anniversary of completion, at Path's discretion, may be settled as to 50 per cent. by the issue of new ordinary shares in Path, in which case the value of those ordinary shares will be based on the volume weighted average price over the 10 business days prior to the date of issue. Thereafter payments due will be settled in cash.

Zoetic will enter into an orderly marketing agreement in respect of any exercise of warrants for a period of 12 months from the date of completion which will have been issued as consideration for the Transaction.

Completion of the Transaction is expected to occur during the next week, and a further announcement will be made when completion occurs.

Commenting, Christopher Theis CEO of Path, said: "We are naturally disappointed by the outcome of our discussions with the FCA, but we are pressing ahead with the preparations for the publication of a prospectus. Meanwhile we look forward to the completion of the Transaction over the coming week and getting to work with our new colleagues in Colorado."

This announcement contains inside information for the purposes of Article 7 of Regulation (EU) 596/2014

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