REG - Fulcrum Metals PLC - Subscription to raise c.£643,500

Fulcrum MetalsAnnouncement

13/09/2024 15:45

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RNS Number : 1981E  Fulcrum Metals PLC  13 September 2024

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PUBLIC DOMAIN.

13 September 2024

Fulcrum Metals plc

 

("Fulcrum" or the "Company" or the "Group")

 

Subscription to raise c.£643,500

 

Fulcrum Metals plc (LON: FMET), a company focused on mineral exploration and
development in Canada, is pleased to announce that it has undertaken a
conditional subscription of 8,043,750 new ordinary shares of 1 pence each
("Ordinary Shares") in the Company (the "Subscription") at a price of 8 pence
per share (the "Issue Price") raising £643,500 before expenses for the
Company.

 

Clear Capital Markets Limited ("Clear Capital") is acting as broker to the
Company in connection with the Subscription. Allenby Capital Limited ("Allenby
Capital") is acting as the Company's nominated adviser in connection with the
Subscription. The Subscription has been conducted with existing shareholders
of the Company.

 

Highlights

 

·    Subscription to raise gross proceeds of £643,500 through the issue
of 8,043,750 Ordinary Shares at 8 pence per Ordinary Share (the "Subscription
Shares").

 

·    The board of Directors (the "Board") are intending to subscribe for
an additional total of c.£114,500 at the Issue Price, following the
publication of the Company's interim results for the six months ended 30 June
2024 which are expected to be published by end of September 2024.

 

·    The Subscription, taken with the proposed participation from the
Board following announcement of the Company's interims, would result in a
total fundraising of c.£733,000 for the Company once completed.

 

·    The Subscription Shares will represent 13.7 per cent. of the issued
share capital of the Company, as enlarged by the issue of the Subscription
Shares and Fee Shares (as detailed below).

 

·    The net proceeds of the Subscription will be utilised by the Company
towards:

 

o  Accelerating growth and driving development of the Teck-Hughes and
Sylvanite gold tailings projects including:

§ The payment of CA$250,000 for the option agreement at Teck-Hughes;

§ Reviewing opportunities for drone supported surveys including Ground
Penetrating Radar (GPR) and Light Detection and Ranging (LiDAR) surveys,
follow auger sampling and on-site bulk sample extraction and reprocessing to
support defining 43-101 compliant resources;

§ Continuing work with Extrakt, a sustainable technology company which uses
separation technology to extract metals from tailings without the use of
cyanide, on the application of its non-toxic technology to process tailings
material at both projects following successful Phase 1 results at Teck-Hughes
that included impressive 59.4% gold recovery rates:

·    Progress Phase 1 testing at Sylvanite to establish material
characterisation and gold recovery rates; and

·    Progress Phase 2 conceptual study at Teck-Hughes to determine the
scoping, specification and sizing of major equipment and processes using the
scale up data derived from phase 1

 

o  Furthering the relationship with Extrakt,  and Extrakt's global alliance
partner Bechtel Engineering, as the Company seeks to enter into an exclusivity
agreement around Extrakt's proprietary technology, following on from advanced
term sheet discussions with Extrakt;

 

o  Reviewing opportunities to establish a technology testing facility in the
Timmins region of Ontario, providing contracting and commercial opportunities;

 

o  Reviewing opportunities to advance the Group's drill ready exploration
assets in Ontario, in particular the Tully and Big Bear gold projects; and

 

o  Providing the Company with additional working capital and for general
corporate purposes.

 

Ryan Mee, Chief Executive Officer of Fulcrum, commented:

 

"We believe there is significant potential at our gold tailings projects,
offering a faster route to revenue generation while positioning Fulcrum as a
leader in environmentally responsible sustainable extraction practices in
Canada. To seize this opportunity, it has been essential to raise additional
capital, despite the challenging market conditions, and I extend my gratitude
to both existing shareholders, and the Directors, who in total intend to
contribute £114.5k.

 

This allows us to press ahead and develop the tailings assets to illustrate
not only the proof of the concept in sustainable extraction but also
recognition of the scale and value of our assets and the opportunity.

 

I am excited about the future for Fulcrum as both a director, a significant
shareholder, and investor in the business and look forward to providing
updates as we deliver against key milestones."

 

Background to and reasons for the Subscription

 

Fulcrum has historically solely focused on the exploration and development of
mineral resources, a process that can often take over a decade before
generating revenue. While the Company's exploration activities, such as its
uranium projects in Saskatchewan, which has since been successfully divested,
for a value of up to CA$3.36 million, show great potential the Board of
Fulcrum has recognised the need to fast-track its path to revenue whilst
continuing its focus on the development of mineral resources in Ontario,
Canada. This has prompted a strategic shift by the Company toward reclaiming
and processing mining tailings to extract value from materials long considered
waste.

 

In November 2023, Fulcrum announced its option to acquire 100% of the
Teck-Hughes tailings project, located in Kirkland Lake, Ontario, Canada
("Teck-Hughes"). Concurrently, the company began discussions with Extrakt
Processing Solutions LLC ("Extrakt") to license its proprietary, non-toxic
separation technology, which extracts metals from tailings without the use of
cyanide. The initial leach test results at Teck-Hughes have been outstanding
achieving gold recovery rates of 59.4%.

 

In April 2024, Fulcrum further expanded its portfolio of mining tailings
projects, by securing an option agreement to acquire 100% of the Sylvanite
gold tailings project ("Sylvanite"). Sylvanite, a former gold-producing mine,
is located just 3km from the Teck-Hughes site. The addition of Sylvanite
significantly enlarges Fulcrum's footprint in the Kirkland Lake Gold Camp-one
of Canada's most productive gold regions. Across Teck-Hughes and Sylvanite,
the Group has a portfolio of Kirkland Lake Tailings projects with
non-compliant estimate of approximately 200,000 gold ounces.

 

This strategic pivot is driven by both the environmental and economic benefits
of reprocessing historical mining tailings. Managing tailings is a significant
challenge for the mining industry, with substantial environmental
consequences. In Canada alone, the government faces over CA$10 billion in
liabilities for cleaning up active and historic mine waste, while Natural
Resources Canada estimates there is an equivalent value of precious metals
trapped in tailings. Reprocessing tailings not only recovers valuable metals
but also helps remove harmful contaminants, enabling the reclamation and
repurposing of the land.

 

By transforming waste into valuable resources, Fulcrum aims to generate
revenue sooner than solely through traditional exploration and development.
This shift also aligns with the Company's goal to address critical
environmental challenges while positioning Fulcrum as a leader in sustainable
mining practices in Canada.

 

The Subscription will primarily enable the Company to advance its phased
studies at both Teck-Hughes and Sylvanite and undertake surveys, auger
sampling and on-site bulk sample extraction and reprocessing at both sites as
part of a process to define 43-101 compliant resources.

 

Furthermore, in order to implement the Company's longer-term strategy and
deliver shareholder value, the Board considers that the Group will be required
to raise additional capital by June 2025.

 

Update on proposed Chair

 

As previously notified by the Company on 3 June 2024, the Company has
identified a proposed replacement Non-Executive Chair and the due diligence
process in respect of this appointment is underway. In the meantime Alan
Mooney is continuing in the role of Interim Non-Executive Chairman whilst the
process to appoint a new Non-Executive Chair is finalised. The Company will
provide further updates at the appropriate time.

 

Details of the Subscription

 

The Subscription has been effected through the issue of 8,043,750 Subscription
Shares at the Issue Price of 8 pence. The Subscription Shares are to be issued
pursuant to the authorities granted to the Board at the Company's annual
general meeting held on 3 June 2024 on a non-pre-emptive basis.

 

When issued, the Subscription Shares will represent 13.7 per cent of the
enlarged share capital of the Company on Admission (as defined below) and will
rank pari passu with the existing Ordinary Shares.

 

The Issue Price represents a discount of approximately 45.0 per cent. to the
closing mid-market price of 14.55 pence of an Ordinary Share on 12 September
2024, being the latest practicable date prior to the publication of this
announcement.

 

The Subscription Shares have been placed with certain existing investors. The
Board value the Company's retail shareholders, but due to the size of the
Subscription and the cost of undertaking a retail offer, the Board determined
that it was not in the Company's interest to make the Subscription available
to all existing shareholders. However, this will be kept under review should
the Company seek to raise further funds in the future.

 

The Subscription is not being underwritten by Clear Capital or any other
person.

 

Directors' intended subscription

 

The Company is currently in a close period under UK MAR pending announcement
of its interim results for the six months ended 30 June 2024 (the "Interim
Results"). In consequence of that, whilst certain members of the Board are
keen to participate in the Subscription, they are not currently permitted to
under the UK MAR framework. However, the Board recognises the importance of
Director participation for shareholders and, as such, certain members of the
Board intend to subscribe for new Ordinary Shares, at the first available
opportunity, following the publication of the Company's Interim Results (the
"Director Participation").

 

The Director Participation is expected to total c.£89,769 and will be carried
out at the Issue Price.  In addition, following publication of the Interim
Results, certain members of the Board are intending to convert outstanding
salaries totaling c.£24,731 into new Ordinary Shares at the Issue Price (the
"Director Fee Conversion").

 

The table below sets out the intentions of certain board members in the
Director Participation and/or Director Fee Conversion following the
Subscription and publication of the Interim Results:

 

 Name                                            Expected number of Ordinary Shares subscribed for following the Subscription  Expected amount in Director Participation (£)   Expected number of Ordinary Shares to be issued pursuant to Director Fee  Expected amount in Director Fee Conversion (£)
                                                                                                                                                                               Conversion
 Ryan Mee (Chief Executive Officer)*             625,000                                                                       £50,000                                         149,125                                                                   £11,929

 Aidan O'Hara (Corporate Development Director)*  375,000                                                                       £30,000                                         44,253                                                                    £3,540
 John Hamilton (Chief Financial Officer          122,112                                                                       £9,769                                          34,241                                                                    £2,739
 Alan Mooney (Interim Non-Executive Chairman)    -                                                                             -                                               81,519                                                                    £6,521

 

*In addition to the shareholdings set out in the table above, OnGold Invest
Corp. ("OnGold"), a company owned equally by Ryan Mee, Aidan O'Hara and
Mitchell Smith, owns 312,500 Ordinary Shares in the Company.

 

Issue of Fee Shares

 

The Company has agreed to issue 525,000 new Ordinary Shares at the Issue
Price, conditional upon Admission, to certain professional advisers, in
settlement of amounts owed by the Company (the "Fee Shares").

 

Admission and Total Voting Rights

 

Application will be made for the 8,043,750 Subscription Shares and the 525,000
Fee Shares (together the "New Shares") to be admitted to trading on the AIM
Market of the London Stock Exchange ("Admission").  It is expected that the
issue of the 8,568,750 New Shares will take place, Admission will become
effective and that dealings in the New Shares on the AIM market of the London
Stock Exchange will commence on or around 20 September 2024.

 

On Admission, the Company will have 58,529,693 Ordinary Shares in issue, each
with one voting right.  There are no shares held in treasury.  Therefore,
the Company's total number of Ordinary Shares and voting rights will be
58,529,693 and this figure may be used by shareholders from Admission as the
denominator for the calculations by which they will determine if they are
required to notify their interest in, or a change to their interest in, the
Company under the FCA's Disclosure Guidance and Transparency Rules.

 

Glossary

 

 Item    Definition

 43-101  43-101 is a securities regulatory instrument that governs how companies can
         disclose mining-related information in Canada.

 

 

For further information please visit https://fulcrummetals.com/
(https://fulcrummetals.com/) or contact:

 Fulcrum Metals PLC
 Ryan Mee (Chief Executive Officer)           Via St Brides Partners Limited

 Allenby Capital Limited (Nominated adviser)
 Nick Athanas / George Payne                  Tel: +44 (0) 203 328 5656

 Clear Capital Markets Limited (Broker)
 Bob Roberts                                  Tel: +44 (0) 203 869 6081

 St Brides Partners Ltd (Financial PR)
 Ana Ribeiro / Paul Dulieu                    Tel: +44 (0) 20 7236 1177

 

 

 

Notes to Editors

 

FULCRUM METALS - BACKGROUND

 

Fulcrum Metals PLC (LON: FMET) is an AIM quoted exploration and development
company which finances and manages exploration projects focused on Canada,
widely recognised as a top mining jurisdiction. Fulcrum's ambition is to
create an environmentally friendly and sustainable tailings and mine waste
business, driving mining change through combining low discovery risk assets
and jurisdictions with transformative technology capable of near-term cash
flow whilst capitalising on a portfolio of highly prospective exploration
assets.

 

IMPORTANT NOTICES

Notice to Distributors

Solely for the purposes of the product governance requirements contained
within: (a) EU Directive 2014/65/EU on markets in financial instruments, as
amended and as this is applied in the United Kingdom ("MiFID II"); (b)
Articles 9 and 10 of Commission Delegated Directive (EU) 2017/593
supplementing MiFID II and Regulation (EU) No 600/2014 of the European
Parliament, as they form part of UK law by virtue of the European Union
(Withdrawal) Act 2018, as amended; and (c) local implementing measures
(together, the "MiFID II Product Governance Requirements"), and disclaiming
all and any liability, whether arising in tort, contract or otherwise, which
any "manufacturer" (for the purposes of the MiFID II Product Governance
Requirements) may otherwise have with respect thereto, the Ordinary Shares
have been subject to a product approval process, which has determined that
such securities are: (i) compatible with an end target market of retail
investors who do not need a guaranteed income or capital protection and
investors who meet the criteria of professional clients and eligible
counterparties, each as defined in MiFID II; and (ii) eligible for
distribution through all distribution channels as are permitted by MiFID II
(the "Target Market Assessment"). The Ordinary Shares are not appropriate for
a target market of investors whose objectives include no capital loss.
Notwithstanding the Target Market Assessment, distributors should note that:
the price of the Ordinary Shares may decline and investors could lose all or
part of their investment; the Ordinary Shares offer no guaranteed income and
no capital protection; and an investment in the Ordinary Shares is compatible
only with investors who do not need a guaranteed income or capital projection,
who (either alone or in conjunction with an appropriate financial or other
adviser) are capable of evaluating the merits and risks of such an investment
and who have sufficient resources to be able to bear any losses that may
result therefrom. The Target Market Assessment is without prejudice to the
requirements of any contractual, legal or regulatory selling restrictions in
relation to the Subscription. Furthermore, it is noted that, notwithstanding
the Target Market Assessment, Clear Capital will only procure investors who
meet the criteria of professional clients and eligible counterparties. For the
avoidance of doubt, the Target Market Assessment does not constitute: (a) an
assessment of suitability or appropriateness for the purposes of MiFID II; or
(b) a recommendation to any investor or group of investors to invest in, or
purchase, or take any other action whatsoever with respect to the Ordinary
Shares. Each distributor is responsible for undertaking its own target market
assessment in respect of the shares and determining appropriate distribution
channels.

Forward Looking Statements

This announcement includes statements that are, or may be deemed to be,
"forward-looking statements". These forward-looking statements can be
identified by the use of forward-looking terminology, including the terms
"believes", "estimates", "plans", "anticipates", "targets", "aims",
"continues", "expects", "intends", "hopes", "may", "will", "would", "could" or
"should" or, in each case, their negative or other variations or comparable
terminology. These forward-looking statements include matters that are not
facts. They appear in a number of places throughout this announcement and
include statements regarding the Directors' beliefs or current expectations.
By their nature, forward-looking statements involve risk and uncertainty
because they relate to future events and circumstances. Investors should not
place undue reliance on forward-looking statements, which speak only as of the
date of this announcement.

Notice to overseas persons

This announcement does not constitute, or form part of, a prospectus relating
to the Company, nor does it constitute or contain any invitation or offer to
any person, or any public offer, to subscribe for, purchase or otherwise
acquire any shares in the Company or advise persons to do so in any
jurisdiction, nor shall it, or any part of it form the basis of or be relied
on in connection with any contract or as an inducement to enter into any
contract or commitment with the Company.

This announcement is not for release, publication or distribution, in whole or
in part, directly or indirectly, in or into Australia, Canada, Japan, New
Zealand or the Republic of South Africa or any jurisdiction into which the
publication or distribution would be unlawful. This announcement is for
information purposes only and does not constitute an offer to sell or issue or
the solicitation of an offer to buy or acquire shares in the capital of the
Company in  Australia, Canada, Japan, New Zealand, the Republic of South
Africa or any jurisdiction in which such offer or solicitation would be
unlawful or require preparation of any prospectus or other offer documentation
or would be unlawful prior to registration, exemption from registration or
qualification under the securities laws of any such jurisdiction.  Persons
into whose possession this announcement comes are required by the Company to
inform themselves about, and to observe, such restrictions.

This announcement is not for publication or distribution, directly or
indirectly, in or into the United States of America.  This announcement is
not an offer of securities for sale into the United States.  The securities
referred to herein have not been and will not be registered under the U.S.
Securities Act of 1933, as amended, and may not be offered or sold in the
United States, except pursuant to an applicable exemption from registration.
No public offering of securities is being made in the United States.

General

Neither the content of the Company's website (or any other website) nor the
content of any website accessible from hyperlinks on the Company's website (or
any other website) or any previous announcement made by the Company is
incorporated into, or forms part of, this announcement.

Allenby Capital, which is authorised and regulated by the FCA in the United
Kingdom, is acting as nominated adviser to the Company in connection with the
Subscription. Allenby Capital will not be responsible to any person other than
the Company for providing the protections afforded to clients of Allenby
Capital or for providing advice to any other person in connection with the
Subscription. Allenby Capital has not authorised the contents of, or any part
of, this announcement, and no liability whatsoever is accepted by Allenby
Capital for the accuracy of any information or opinions contained in this
announcement or for the omission of any material information, save that
nothing shall limit the liability of Allenby Capital for its own fraud.

Clear Capital, which is authorised and regulated by the FCA in the United
Kingdom, is acting as broker to the Company in connection with the
Subscription. Clear Capital will not be responsible to any person other than
the Company for providing the protections afforded to clients of Clear Capital
or for providing advice to any other person in connection with the
Subscription. Clear Capital has not authorised the contents of, or any part
of, this announcement, and no liability whatsoever is accepted by Clear
Capital for the accuracy of any information or opinions contained in this
announcement or for the omission of any material information, save that
nothing shall limit the liability of Clear Capital for its own fraud.

 

 

 

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