REG - Keras Resources PLC - Issue of Convertible Loan Notes

Keras ResourcesAnnouncement

26/06/2025 15:00

For best results when printing this announcement, please click on link below:
https://newsfile.refinitiv.com/getnewsfile/v1/story?guid=urn:newsml:reuters.com:20250626:nRSZ6078Oa&default-theme=true

RNS Number : 6078O  Keras Resources PLC  26 June 2025

Keras Resources plc / Index: AIM / Epic: KRS / Sector: Mining

 

26 June 2025

 

Keras Resources plc ('Keras' or the 'Company')

 

Issue of Convertible Loan Notes

Proposed Open Offer

Keras Resources plc (AIM: KRS) is pleased to announce that it has, on 25 June
2025, issued convertible loan notes ("CLNs") totalling £750,000, each for
£375,000, to Christopher Grosso and Joseph Carbone. The proceeds of the CLNs
will be used primarily to pay the final tranche of $800,000 payable to the
Helda Living Trust in respect of the acquisition of minority interests in
Falcon Isle Resources Corp., which is now a wholly owned subsidiary of the
Company, and for working capital.

 

The CLNs will be convertible in whole or in part into Ordinary Shares of 1p
each in the Company at 1.4p per share, subject to regulatory considerations
and the consent of the Takeover Code to put a Rule 9 waiver resolution to
Independent Shareholders, and will be repayable in part from the proceeds of a
proposed Open Offer. The Company has agreed with the Panel that Mr. Grosso and
Mr. Carbone are acting in concert in relation to the Company and Messrs.
Grosso and Carbone currently hold 21.36% and 7.42% of the existing share
capital of the Company respectively. Mr Grosso has subscribed for the CLN
through the Diane H. Grosso Credit Shelter Trust, an associate of Mr. Grosso.

 

As the conversion of the CLNs could lead to Messrs. Grosso and Carbone
holding, in aggregate, over 30%, but less than 50% of the issued share capital
of the Company,  any conversion of the CLNs would be subject to obtaining
Takeover Panel consent to a waiver of the requirement for Messrs. Grosso and
Carbone to make a general offer under Rule 9 of the Takeover Code and the
passing of a Rule 9 waiver resolution by a poll of independent shareholders.

 

The CLNs will initially be interest free, but, should the resolution in
respect of the Rule 9 waiver referred to below prevent conversion of the CLNs,
interest on the debt will be payable at 20% per annum and security may be
required by the holders of the CLNs. Under those circumstances, the CLNs will
be repayable after 30 days' notice to be given by either party at any time
after 30 June 2026.

 

Subject to receipt of Takeover Panel approval for the Rule 9 waiver, the
Company intends to call a General Meeting to put to the independent
shareholders a Rule 9 waiver resolution, which, if passed, would enable
Messrs. Grosso and Carbone to convert the CLNs.

 

Open Offer

Subsequent to the issue of the CLNs, the Company is proposing to launch an
open offer to qualifying shareholders at a price of 1.4 pence per open offer
share, pro rata to their holdings of existing shares on the record date (to be
advised) on the basis of 542 offer shares for every 1,000 existing shares (the
"Open Offer"). The funds raised under the Open Offer will be used to repay the
part of the CLNs which is not converted.

 

The Directors have given consideration as to the best way to structure a
proposed equity fundraising, taking into account current market conditions,
the composition of the shareholder register and the Board's desire to give
shareholders the opportunity to avoid dilution where practicable and have
concluded that the issue of the CLNs and the Open Offer is the most suitable
option available to the Company and its shareholders as a whole. The Open
Offer will provide an opportunity for all qualifying shareholders to
participate in the fundraising by acquiring Offer Shares pro rata to their
current holdings of existing shares.

 

Further details will be provided to shareholders in regard to both the Rule 9
waiver and the Open Offer in due course.

 

Related Party Transaction

The Diane H. Grosso Credit Shelter Trust  (an associate of Christopher
Grosso, a substantial shareholder in the Company as defined under the AIM
Rules for Companies (the "AIM Rules")), is considered to be a Related Party of
the Company, and the provision of the CLN set out above is therefore deemed to
be a Related Party Transaction pursuant to AIM Rule 13 of the AIM Rules for
Companies.

 

The Directors of the Company independent of the issue of the CLN, being Brian
Moritz, Russell Lamming and Claire Parry, consider, having consulted with the
Company's Nominated Adviser, SP Angel Corporate Finance LLP, that the proposed
terms of the Convertible Loan are fair and reasonable insofar as the Company's
shareholders are concerned.

 

Russell Lamming, Executive Chairman of Keras, commented, "The funding solution
today is the final payment for the acquisition of the Diamond Creek Mine -
this is the cornerstone asset of the Company which is considered to be the
highest grade rock phosphate project in North America. Diamond Creek produces
a range of sized rock phosphate products into the North American organic
fertiliser market and more recently has introduced PhoSul®, a direct
application granulated product used in various organic fertilizer blends to
the range of products. The wholly owned integrated processing plant facility
in Delta, Utah has underpinned the growth of the Company and, post this final
payment we look forward to being the only 100% independent organic rock
phosphate producer in North America.

I believe that we have a significant business going forward and look forward
to the journey with you all."

 

The information contained within this announcement is deemed by the Company to
constitute inside information as stipulated under Article 7 of the Market
Abuse Regulation (EU) No. 596/2014 (as amended) as it forms part of the
domestic law of the United Kingdom by virtue of the European
Union (Withdrawal) Act 2018 (as amended). Upon the publication of this
announcement via the Regulatory Information Service, this inside information
is now considered to be in the public domain.

 

**ENDS**

 

For further information please visit www.kerasplc.com
(http://www.kerasplc.com/) , follow us on Twitter @kerasplc or contact the
following:

 

 Russell Lamming                       Keras Resources plc             info@kerasplc.com

 Nominated Adviser & Joint Broker      SP Angel Corporate Finance LLP  +44 (0) 20 3470 0470

 Ewan Leggat / Jen Clarke

 Joint Broker                          Shard Capital Partners LLP      +44 (0) 207 186 9900

 Damon Heath / Erik Woolgar

Notes:

Keras Resources (AIM: KRS) wholly owns the Diamond Creek organic phosphate
mine in Utah, US. Diamond Creek is one of the highest-grade organic
phosphate deposits in the US and is a fully integrated mine to market
operation with in-house mining and processing facilities. The operation
produces a variety of organic phosphate products that can be tailored to
customer organic fertiliser requirements.

 

The Company is focused on continuing to increase market share in the
fast-growing US organic fertiliser market and build Diamond Creek into the
premier organic phosphate producer in the US.

 

 

This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact
rns@lseg.com (mailto:rns@lseg.com)
 or visit
www.rns.com (http://www.rns.com/)
.

RNS may use your IP address to confirm compliance with the terms and conditions, to analyse how you engage with the information contained in this communication, and to share such analysis on an anonymised basis with others as part of our commercial services. For further information about how RNS and the London Stock Exchange use the personal data you provide us, please see our
Privacy Policy (https://www.lseg.com/privacy-and-cookie-policy)
.   END  MSCFFMTTMTBTBLA