Pathfinder Minerals Plc – Corporate Update

Pathfinder Minerals Plc – Corporate Update

Pathfinder announces that the Company has entered into a fixed period consultancy agreement, until 30 September 2019, with Africa Focus Group Limited, a Hong Kong-based company with a Johannesburg consultancy office specialising in mergers and acquisitions in southern Africa. Under the Consultancy Agreement, AFG will provide assistance to the Company in pursuing completion of a legally binding transaction with the owners of Pathfinder Moçambique, S.A pursuant to which Pathfinder or a wholly owned subsidiary of Pathfinder would acquire, or otherwise be reinstated with or receive transfer of, direct ownership and effective control of Mining Concession 4623C on such terms and conditions as the Company, at its sole discretion, may agree with the owners of Pathfinder Moçambique, S.A. (the "Proposed Transaction").

In consideration of the provision of services under the Consultancy Agreement, the Company shall, only following the effective legal completion of the Proposed Transaction, pay AFG a fee in cash of £1,000,000 (inclusive of any VAT) (the "Fee").  The Fee is conditional on and only becomes due and payable if the Company has successfully raised sufficient funds to make payment of the Fee in full. The Company has agreed to use its reasonable endeavours to take the necessary steps to procure that sufficient funds are raised by the Company to enable satisfaction of the payment obligation within a reasonable period after completion of the Proposed Transaction.

While there is no legal obligation or other form of undertaking by the Company to do so nor any other informal arrangement with AFG to that effect, the Company intends to consider in good faith a request by AFG (if made) to allow the Fee (when due and payable) to be used to subscribe for new ordinary shares in the Company in due course (the "New Shares"). In the event that this does occur any such arrangement, to allow the Fee to be used to pay up a subscription of New Shares, shall be on the basis that the aggregate number of New Shares issued to AFG shall not exceed 9 per cent of the entire issued share capital of the Company at the time of such issue and as enlarged by the issue of the New Shares.

If at any time prior to the earlier of the termination of the Consultancy Agreement, the end of the Consultancy Agreement or the completion of the Proposed Transaction, more than 50 per cent of the entire issued share capital of Company is held by a single shareholder, together with its concert parties, following a successful takeover offer, then the Company shall pay to AFG an abort fee in cash of £250,000.

Scott Richardson Brown, Chief Executive Officer, commented: "We are very pleased to have formalised our relationship with AFG with whom we have been working successfully for a number of months. I feel confident that we can move forward with them to the successful conclusion of the good faith negotiations that are progressing in Mozambique. The possibility of AFG taking an equity interest in the Company in future, we believe, would align their interests with those of our shareholders."

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