Corcel PLC

("Corcel" or the "Company")

Debt Conversion, Funding and Refinancing, Underwritten Equity Share Agreement

21 February 2022

Corcel, the natural resource exploration and development company with interests in battery metals and flexible energy generation and storage is pleased to announce a partial debt conversion and a new combined debt and equity funding solution of up to £1,050,000.    

Highlights:

o Corcel continues to progress its Battery Metals led strategy with multiple potential near-term catalysts expected including the mining lease award at Mambare, the JORC upgrade at Wo Wo Gap and the funding of the UK peaker plant portfolio

o  Supporting these initiatives, the Company announces a funding package of up to £1,050,000 which includes

o  A new £450,000 debt facility with warrants exercisable at £0.015

o  Refinancing of £405,000 of existing debt including the conversion of £135,000 to equity and the extension of   the balance to end October 2022

o  A £600,000 Equity Share Agreement with a £0.015 floor price

Scott Kaintz, Chief Executive, commented: "The Board is pleased to announce a partial conversion of our debt and a new funding solution for the business organised and co-ordinated by a supportive shareholder which is expected to bridge the Company to several major value inflection events, and likely does so at prices well above the current market; therefore, reducing  dilution for existing shareholders."

Debt Facility

The Company has agreed a Loan Note Facility ("Loan Facility") with Align Research and Riverfort Global Opportunities PCC Limited, (the "Lenders") to provide, in aggregate, £450,000 through an unsecured loan facility, for working capital purposes in support of the execution of the Company's battery metals led strategy.

The Loan Facility, which is aimed at reducing dilution at current prices, provides for the loan ("Loan") to be drawn down in tranches beginning with £250,000 immediately and the balance in equal instalments monthly through May 2022. The Loan plus a fixed coupon of 8% is repayable in full on 31 October 2022 (the "Repayment Date") except where the Lenders request part or all of the Loan and any coupon to be utilised in paying for the warrants.

As part of the Loan Facility, the Company will issue a total of 30,000,000 warrants to the Lenders with a £0.015 strike price expiring on 20 February 2024 (the "Warrants"). The coupon is repayable in either cash or shares at the Lender's discretion, and if in shares at a price of £0.015 per share.     

Should the Warrants be exercised in whole or part during the term of the Loan Facility it has been agreed that the Warrant payment proceeds will be netted off against the repayment of the pro-rata drawn Loan Facility.  In the event of the Warrants being exercised during this period the full 8% Loan Facility interest will be payable in shares ("Interest Shares") at a price of £0.015 per share. 

If the entirety of the Warrants are exercised, this would result in an additional 30,000,000 Ordinary shares in relation to the Warrants and 2,400,000 ordinary shares in relation to the Interest ultimately being issued. 

If the Company undertakes a new placing of ordinary shares before 20 February 2023 while the warrants remain outstanding and below a price of £0.015, then the warrant strike price will be adjusted to reflect the placing price and the Company will issue additional warrants such that the total value of the warrants equates to £450,000.

Partially Underwritten Equity Share Agreement

The Company has agreed terms with Align Research on an Equity Share Agreement by which the Company gives Align Research the right to subscribe for a maximum of £600,000 of new ordinary shares of the Company at a minimum price of £0.015 (the "Minimum Subscription Price") over a ten-month period (the "ESA"). 

Any agreed issuance of shares under this structure above the Minimum Subscription Price is to be determined by the price at which Align Research has itself agreed to sell the relevant shares to another buyer ("the Agreed Price") and would result in the Company receiving a subscription price per new ordinary share of the Minimum Subscription Price plus 60% of the Agreed Price above the Minimum Subscription Price.  An implementation fee of 2,400,000 new ordinary shares is payable to Align Research (the "ESA Shares").

The Company retains the right to terminate this agreement at any time with the exception of any shares Align Research has already agreed to sell onto a third party prior to such termination.

To provide further certainty of funding to the Company, Align Research has agreed to underwrite the first £350,000 of the Equity Share Agreement.  This portion of new equity, if required, is to be priced at the closing bid price of the Company's shares on 31 March 2022. (the "Placing")  A 5% placing fee will be due at completion of the placing payable in new ordinary shares of the Company, and any share issuance and payments made to the Company under the ESA prior to 31 March 2022 will serve to reduce the underwritten portion of the Equity Share Agreement.   

The Company has also agreed to issue a further 4,800,000 new Ordinary Shares at a price of £0.015 ("Supplier Shares") for an invoice received from Align Research in respect of research services retainer for a 24-month period. 

Debt Restructuring, Debt Conversion and Warrant Repricing

Corcel has agreed with the Lenders of an unsecured loan facility of £405,000 of principal and interest, originally announced on 12 May 2021 and due 30 April 2022, to restructure the debt and interest due.  The restructuring includes the Lenders irrevocably committing to subscribe £135,000 of the existing loan facility into new ordinary shares in the Company at the closing bid price of the Company's shares on 31 March 2022 and the due date on the balance being extended to 31 October 2022.  An additional 5% interest is due on these refinanced amounts as a restructuring fee payable 31 October 2022 taking the overall coupon to 13%.     

As previously announced on 14 December 2021, C4 Energy Limited ("C4"), a Company controlled by the Company's Chairman, also intends to convert its current debt position of £126,917 to equity, which will be subject to a further announcement as appropriate once a formal agreement has been entered into.  C4 has indicated its intention to convert this debt at a minimum price of £0.015 per share.

In addition, following the funding solution, 20,000,000 warrants, previously issued on 12 May 2021, have now been repriced from £0.025 to £0.015 per share.  These warrants shall be fixed at £0.015 per share until after the Placing, at which time they will have an adjustment mechanism whereby the warrant strike price adjusts downward to reflect any future placing completed at lower than £0.015 during the remaining life of the warrants.    

Following the funding solution announced today and the planned conversions outlined herein, the Company would have a total £1,460,000 debt of which principal amounts of £125,000 are due 31 April 2022, £720,000 being due end October 2022 and as announced on 14 December 2022, a further £619,000 due end December 2022.

Admission to Trading on AIM and Total Voting Rights

Application is being made to AIM for 7,200,000 shares to be admitted to trading on AIM, the admission of which it is expected on or around 25 February 2022.

In accordance with the provision of the Disclosure Guidance and Transparency Rules of the Financial Conduct Authority, the Company confirms that, following the issue of the ESA Shares and the Supplier Shares, its issued ordinary share capital will comprise 391,987,601 ordinary shares.

All of the ordinary shares have equal voting rights and none of the ordinary shares are held in Treasury. The total number of voting rights in the Company will therefore be 391,987,601. The above figure may be used by shareholders as the denominator for the calculations to determine if they are required to notify their interests in, or change to their interest in, the Company.

Scott Kaintz 020 7747 9960                                                          Corcel Plc CEO 

James Joyce / Andrew de Andrade 0207 220 1666                    WH Ireland Ltd NOMAD & Broker

Simon Woods 0207 3900 230                                                        Vigo Communications IR 

This announcement contains inside information for the purposes of Article 7 of Regulation 2014/596/EU, which is part of domestic UK law pursuant to the Market Abuse (Amendment) (EU Exit) regulations (SI 2019/310) and is disclosed in accordance with the Company's obligations under Article 17.