REG-IMC Exploration Group Plc: Update: Proposed Acquisition of Karaberd Mine

IMC ExplorationAnnouncement

31/10/2022 07:15

THE DIRECTORS OF IMC EXPLORATION GROUP PLC CONSIDER THIS ANNOUNCEMENT TO
CONTAIN INSIDE INFORMATION FOR THE PURPOSES OF ARTICLE 7 OF REGULATION (EU)
NO. 596/2014 OF THE EUROPEAN PARLIAMENT AND THE COUNCIL OF 16 APRIL 2014 ON
MARKET ABUSE AS IT FORMS PART OF RETAINED EU LAW AS DEFINED IN THE EUROPEAN
UNION (WITHDRAWAL) ACT 2018 (THE "MARKET ABUSE REGULATION"). UPON THE
PUBLICATION OF THIS ANNOUNCEMENT THE INSIDE INFORMATION IS NOW CONSIDERED TO
BE IN THE PUBLIC DOMAIN.

IMC Exploration Group Public Limited Company

(“IMC” or the “Company”)

Proposed Acquisition of Karaberd Mine – Update

IMC Exploration Group plc (“IMC”), the London-listed exploration company
based in Ireland, is pleased to announce the following update in relation to
the previously announced (15(th) April 2021) Framework Agreement dealing with
the proposed acquisition from MVI Invests (“MVI”) of MVI Ireland s.r.o.
(“MVI Ireland”), a special purpose company established to own 100% of
Assat LLC (“Assat”), an Armenian-registered company that holds the mining
licence for the Karaberd Mine, located in Lori Marz, northern Armenia (the
“Acquisition”).   This transaction, as previously announced, is
classified as a reverse takeover (“RTO”) pursuant to the Listing Rules of
the Financial Conduct Authority of the United Kingdom ("FCA") (the "Listing
Rules") to which the Company is subject, and under the Irish Takeover Panel
Act 1997, Takeover Rules 2013 (the “Takeover Rules”).

Following delays attributable primarily to the Covid-19 pandemic, MVI decided
early in 2021 to commence the preparation works for mining operations at the
Karaberd Mine.  These works included preparation of 450m of new soil road,
cleaning and servicing of a further 1,300m of soil roads and 140,000m(3) of
stripping work.

It had become apparent that, also as a result of disruptions caused by
Covid-19, the building of a production facility for extraction of metals
including gold and silver with 100,000 tons’ per annum capacity, which MVI
had earlier negotiated, would be severely delayed. Assat therefore negotiated
interim arrangements with a local refiner to process ore from the Karaberd
Mine.  During the year ended 31(st) December 2021, a total of 46.2 kg of
0.999 purity fine gold had been extracted at that plant from Karaberd Mine
crushed ore output.

At the beginning of 2022 Assat, satisfied that there were in place
economically mineable quantities of gold and silver at the Karaberd Mine,
decided to start stockpiling its crushed ore for processing in the new
production facility discussed above, which is expected to be completed by May
or June of 2023.  This policy should yield a higher marginal return and will
also allow for the extraction of silver from mined ore. Currently, there are
over 20,000 tons of crushed ore stockpiled and the rate of ore-crushing will
increase once the production facility is completed.

Although the developments described above are positive from IMC’s
perspective, they have meant that the character of the Acquisition has changed
from that originally conceived. IMC, rather than acquiring a company possessed
of a mining licence, is now acquiring the owner of an operating gold mine.

The restrictions on international movements imposed as a result of Covid-19
meant that IMC’s first possibility to visit the Karaberd Mine site at Lori
Marz arose in August of last year.

The altered character of the Acquisition, the attenuation of timetables owing
to factors beyond the control of IMC and MVI and the recent emergence of new
geological data from additional exploration works, both on the Company’s
extant licence areas in Ireland and on Assat’s Karaberd licence in Armenia,
led IMC and MVI to agree on the necessity for more recent, audited financial
information and for the updating and positive revision of the Competent
Persons’ Reports on their respective assets.

The FCA in December 2021 increased the market capitalisation threshold from
£700,000 to £30,000,000 for companies being listed on the standard segment
of the FCA's Official List.  For this reason, IMC and MVI decided it would be
prudent to commission in advance an independent valuation of the enlarged
Company's combined assets post- RTO in order to assist in meeting this
threshold.  This process is now underway. 

For the avoidance of doubt, the Acquisition remains on the terms of the
Framework Agreement announced on 15(th) April 2021 with the exceptions of
extensions already announced to the long-stop dates and of the share
‘clawback’ clause requiring a specified quantity of gold to have been
refined after a ‘Karaberd Commencement of Mining’.  This clause, already
having been satisfied, has accordingly fallen away. 

IMC would like to thank shareholders for their patience in supporting the
Company during the protracted progress of the Acquisition.  Further updates
will be issued as and when required.

Eamon P. O’Brien,

Executive Chairman,

Dublin, 28(th) October 2022

The Directors of IMC, after due and careful enquiry, accept responsibility for
the content of this announcement.

REGULATORY ANNOUNCEMENT ENDS.

Enquiries:

Keith, Bayley, Rogers & Co. Limited

Graham Atthill-Beck: +44 7506 43 41 07 / Graham.Atthill-Beck@kbrl.co.uk;
blackpearladvisers@gmail.com    

Brinsley Holman: +44 7776 30 22 28/ Brinsley.Holman@kbrl.co.uk

IMC Exploration Group plc

Kathryn Byrne: +353 85 233 6033



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