ZOL Zoltav Resources Inc

TIDMZOL

RNS Number : 1141W

Zoltav Resources Inc

20 December 2021

20 December 2021

Zoltav Resources Inc.

("Zoltav" or the "Company")

Proposed cancellation of admission of Ordinary Shares to trading on AIM

Tender Offer to purchase Ordinary Shares held by Qualifying Shareholders

and

Notice of Extraordinary General Meeting

Zoltav (AIM: ZOL), the Russia-focused oil and gas exploration and production company, announces that a circular (the "Circular") will be sent today to Shareholders detailing the following proposals:

-- the cancellation of admission of Zoltav's Ordinary Shares to trading on AIM (the "De-listing");

-- a Tender Offer under which ARA Capital Holdings Limited will conditionally offer to purchase 16,762,099 Ordinary Shares held by Qualifying Shareholders at 25 pence per share; and

-- the extension of the repayment date of the Loan Facility entered into with ARA Capital Holdings Limited to 28 February 2022.

Additionally, further to the Company's announcement on 29 December 2020 regarding a Share Purchase Agreement between ARA Capital Holdings Limited and Bandbear Limited (the terms of which were amended as per the announcement on 8 November 2021), which was conditional, inter alia, on ARA Capital Holdings Limited obtaining clearance from the Russian Federal Antimonopoly Service, the Company has been notified that such clearance has now been obtained.

Unless otherwise stated, terms used in this announcement have the same meanings as given to them in the Circular.

Both the De-Listing and the Tender Offer are conditional, inter alia, upon the De-Listing Resolution being passed at the General Meeting to be held at Sackville House, 40 Piccadilly, London W1J 0DR, United Kingdom at 12.00 p.m. on 19 January 2022. Notice of the General meeting will also be sent to Shareholders today.

If the Tender Offer does not proceed for any reason, Qualifying Shareholders will not receive the Tender Offer Price for any of their Ordinary Shares.

Set out below is further information as to the background to, and reasons for, the De--Listing, Tender Offer and potential conversion of the Loan Amount at the Loan Amount Conversion Rate which, together, comprise the Proposals.

The Circular and Notice of General Meeting can be viewed on the Company's website at www.zoltav.com.

Background

Zoltav, in its current form, has been listed on AIM since 2011. The main purpose of the listing was to provide access to capital for investment in acquiring and developing oil and gas assets primarily in Russia, and to provide a trading facility for Shareholders.

Since 2014, the Company's primary operational focus has been the development of the Bortovoy Licence in Saratov, Russia. During that time, the perception of investors in the London market towards junior oil and gas companies, particularly those focused primarily on Russia, has deteriorated and the Company has been unable to attract investment or access funding from the public capital markets. As such, the Company has relied entirely on Russian bank finance, and the support of its Majority Shareholders who own, in aggregate, approximately 88 per cent. of the Company.

Zoltav has no significant UK based institutional investors among its Shareholders and its focus on oil and gas assets solely in Russia, together with the composition of its share register, mean that it is unlikely the business will be able to raise finance through the issue of new shares on AIM, which is one of the primary reasons for being listed.

Given Zoltav's current ownership structure, the Company has a limited free float resulting in low liquidity in the Company's Ordinary Shares. As such, the Company's share price is subject to high volatility and the AIM listing does not generally provide an opportunity for the Company's Shareholders to trade in meaningful volumes. In the event that ARA Capital Holdings Limited elects to convert the Loan Amount under the Loan Facility pursuant to the terms of the Loan Facility in full the free float would be expected to reduce to approximately 8 per cent.

The Directors do not believe these factors are likely to significantly improve in the foreseeable future.

Notwithstanding this, the Directors have sought to maintain the Company's listing on AIM to provide a trading facility for Shareholders for as long as practicable. However, the project finance facilities entered into by the Company's main operating subsidiary, Diall Alliance, in October 2021 contain conditions which restrict intra group transfers and cash outflows from Diall Alliance to the Company. Without project finance or alternative sources of capital, Diall Alliance would have been unable to service its loans beyond the end of 2021.

In light of the restrictions on intra group transfers, and having explored alternative options to finance the Company, the Directors have concluded that it is highly unlikely the Company will be able to maintain its financial obligations with respect to the Company's AIM quotation on an ongoing basis.

The Directors estimate there are at least US$ 0.5 million per annum of costs directly associated with the listing. This is significant given the Company's current financial position and these funds could be better invested in the development programmes and production improvements that are the basis for the future of the business. For the foreseeable future, the considerable cost, management time and the legal and regulatory obligations associated with maintaining the Company's admission to trading on AIM are materially disproportionate to the benefits to the Company, especially in the context of the small executive team.

For the reasons outlined above, the Board is of the view that the considerable cost, management time and the legal and regulatory obligations associated with maintaining the Company's admission to trading on AIM significantly outweighs the benefits of a public quotation.

The Board is however mindful that not all Shareholders will be able or willing to continue to own Ordinary Shares following the De-Listing. Accordingly, the Board approached the Company's Majority Shareholders, who control in aggregate approximately 88 per cent. of the Company's Ordinary Shares, with regards to facilitating a Tender Offer to Qualifying Shareholders and ARA Capital Holdings Limited agreed to make the Tender Offer to Qualifying Shareholders conditional only on the passing of the De-Listing Resolution. The Tender Offer provides Qualifying Shareholders a means to realise their investment in the Company for cash at 25 pence per Ordinary Share, representing a premium of 11.1 per cent. to the closing share price on the Latest Practicable Date and a premium of 8.3 per cent. to the thirty-day volume weighted average closing share price to the Latest Practicable Date.

The Tender Offer will be financed from ARA Capital Holdings Limited's existing cash resources.

If The Tender Offer is taken up in full, ARA Capital Holdings Limited will become holder of approximately 22 per cent. of the Company.

Under the tender offer provisions of Cayman Islands Companies Act, an acquiror of shares in a Cayman Islands company is entitled to compulsorily acquire the shares it does not already own if it has acquired at least 90 per cent. of the shares the subject of the offer. Under the merger provisions of the Cayman Islands Companies Act, an acquiror of shares in a Cayman Islands company is, in certain circumstances, able to compulsorily acquire the shares it does not already own if it holds at least 90 per cent. of the issued share capital of the company if a copy of the plan of merger is given to the remaining shareholders. Assuming ARA Capital Holdings Limited acquires the relevant amount of Ordinary Shares necessary to use these procedures, it is anticipated that they may do so.

Qualifying Shareholders are not obliged to tender all or some of their Ordinary Shares if they do not wish to do so. If the Resolutions are approved by the requisite number of Shareholders and Qualifying Shareholders do not tender their Ordinary Shares pursuant to the Tender Offer then they will not receive cash for their Ordinary Shares and the admission of the Ordinary Shares to trading on AIM will be cancelled. Shareholders will then hold their Ordinary Shares in an unlisted company. Whilst the Ordinary Shares will remain freely transferable (subject to the provisions of any new articles of association that the Company adopts following the De-Listing), it is likely that the liquidity and marketability of the Ordinary Shares will, in the future, be even more constrained than at present and the value of such Ordinary Shares may be adversely affected as a consequence. It should be noted that following the De-Listing the Directors do not intend to provide, seek or support any arrangements whereby the Ordinary Shares can be bought or sold on a matched bargain basis. Accordingly, interests in Ordinary Shares are unlikely to be readily capable of sale and, where a buyer is identified, it will be difficult to place a fair value on any such sale. Any Shareholders wishing to transfer their Ordinary Shares following the De-Listing should contact any Director of the Company at the registered office of the Company and by email at zoltav@diall.ru.

The Company is also announcing today that the Loan Facility repayment date is to be extended to the 28 of February 2022. The Loan Amount is capable of being converted by the holder of the Loan Facility, ARA Capital Holdings Limited, on serving notice on the Company that it wishes the Loan Amount to be converted at the Loan Amount Conversion Rate. The Board is of the view that it is prudent to include in the Resolutions, to be proposed at the General Meeting, resolutions one and two that enable the Company to issue sufficient new Ordinary Shares of up to 54,000,000 new Ordinary Shares (the exact number of which to be determined upon the date of conversion by reference to the exchange rate of US dollars to Sterling, but which shall not exceed the maximum number of 54,000,000) upon conversion of the Loan Amount at the Loan Amount Conversion Rate in the event that ARA Capital Holdings Limited elects to convert the Loan Amount. In the event that the Loan Amount is converted in full at the Loan Amount Conversion Rate and separate to any of the other Proposals set out in the Circular and any other acquisition or issue of Ordinary Shares to ARA Capital Holdings Limited, then ARA Capital Holdings Limited (on conversion of the full amount of the Loan Amount only) would become the holder of approximately 35 per cent. of the total Ordinary Shares in issue and, together with ARA Capital Limited, would hold approximately 63 per cent. of the total issued Ordinary Shares in issue. Furthermore, if the Loan Amount is converted in full at the Conversion Rate, ARA Capital Holdings Limited acquires the Ordinary Shares held by Bandbear Limited and irrespective of whether the Tender Offer is taken up, ARA Capital Holdings Limited would hold approximately 63 per cent. of the total issued Ordinary Shares and together with ARA Capital Limited would hold approximately 91 per cent. of the issued Ordinary Shares.

Accordingly, the purpose of this announcement and the Circular is to provide Shareholders with the background to the Proposals, to seek the requisite approval from Shareholders and to provide Qualifying Shareholders with information regarding how to participate in the Tender Offer.

Current Trading and Future Plans

All of the Group's production is currently derived from two fields (Zhdanovskoye and Karpenskoye) on the Bortovoy Licence, consisting of 16 gas wells and two oil wells producing via electrical submersible pumps. The Karpenskoye and Zhdanovskoye fields are expected to become uneconomical by 2023.

The significant majority of the Group's revenues (approximately 81 per cent.) are derived from gas sold domestically within Russia to Mezhregiongaz, a Gazprom subsidiary company. The gas prices are fixed in a contract with Mezhregiongaz and are subject to indexation. Domestic gas prices are set by the Russian Government, are reviewed annually according to inflation, and take effect from 1 July each year.

The average gas price realised by the Company in the six months ended 30 June 2021 was RUB 4,028 per thousand cubic metres. The last price increase which took effect on 1 July 2021 was 3 per cent.

Most of the Group's remaining revenue is derived from oil and condensate sold through a tender process to a small number of different buyers.

The Company reported average net daily commercial production in the six months to 30 June 2021 of 29.7 million cubic feet per day (0.84 million cubic metres per day) of gas and 221 barrels per day (28.2 tonnes per day) of oil and condensate.

From 1 July 2021 to 30 November 2021 (being the most recent period prior to the publication of this announcement), the Group's average net daily commercial production remained in line with the production for the first six months of 2021.

The Company is planning an expansion of its activities through a phased commissioning of five new fields: Pavlovskoye - February 2022; Lipovskoye - July 2022; Nepryakhinskoye - March 2023; Mokrousovskoye - 2028; and West Lipovskoye - 2030.

In order to produce, transport and process gas from these fields, the expansion project requires the construction of a 206-kilometre gas pipeline, as well as the capacity expansion of the existing processing plant from 18,540 million cubic feet per year (525 million cubic metres per year) to 31,783 million cubic feet per year (900 million cubic metres per year), with this new annual processing capacity expected to be reached in March 2023.

The total capital expenditure of the expansion project is estimated at approximately RUB 12.3 billion, including costs already incurred.

Reasons for the De--Listing

The Board has conducted a review of the benefits and drawbacks to the Company of retaining its listing on AIM and maintaining its existing corporate structure. The management team is committed to continuing to strengthen its business and the Board believes that the De--Listing is in the best interests of the Company and its Shareholders as a whole and affords the best opportunity for enhancing the Company's ability to grow and develop. In reaching this conclusion, the Board has considered the following key factors:

-- in the opinion of the Board, the Company is not of a scale to attract sufficient interest from institutional and other investors and therefore it is difficult to create a more liquid market for its shares to effectively or economically utilise its quotation;

-- the Majority Shareholders together currently hold approximately 88 per cent. of the Company's voting rights and, as a result, the free float and liquidity of the Ordinary Shares is limited;

-- in light of the limited trading in the Ordinary Shares, with an average daily volume over the past 12 months of approximately 13,520 Ordinary Shares representing 0.0095 per cent. of the current issued share capital, the costs associated with maintaining the AIM quotation are considered by the Directors to be disproportionately high when compared to the benefits, and the Board believes that these funds could be better utilised;

-- in light of the restrictions on intra group transfers, and having explored alternative options to finance the Company, it is highly unlikely the Company will be able to maintain its financial obligations with respect to the Company's AIM quotation on an ongoing basis;

-- the Company has been unable to fully utilise its listing on AIM to issue Ordinary Shares either as consideration or to raise fresh capital to provide the capital expenditure required to develop its assets;

-- the management time and the legal and regulatory burden associated with maintaining the Company's admission to trading on AIM is, in the Directors' opinion, disproportionate to the benefits to the Company; and

-- the Directors also believe that De--Listing will allow the Company greater flexibility to execute its growth strategy whilst reducing its cost base.

Effect of De--Listing

The principal effects of the De--Listing will be that:

-- Shareholders will no longer be able to buy and sell Ordinary Shares through a public stock market, further reducing the liquidity in the Ordinary Shares;

   --    the Company will no longer be required to announce material events, final or interim results; 

-- the Company will no longer be required to comply with many of the corporate governance requirements applicable to companies traded on AIM;

-- the Company will no longer be subject to the Disclosure and Transparency Rules and will therefore no longer be required to disclose major shareholdings in the Company;

-- the Company will no longer be subject to the AIM Rules, with the consequence that Ordinary Shareholders will no longer be afforded the protections given by the AIM Rules. Such protections include a requirement to obtain shareholder approval for reverse takeovers and fundamental changes in the Company's business and to announce, inter alia, certain substantial and/or related party transactions; and

-- the De--Listing may have either positive or negative taxation consequences for Shareholders. Shareholders who are in any doubt about their tax position should consult their own professional independent adviser immediately.

De--Listing Process

Under the AIM Rules, the De--Listing can only be effected by the Company after securing a special resolution of Shareholders in a general meeting and the expiry of a period of at least 20 business days from the date on which notice of the De--Listing is given to the London Stock Exchange. In addition, a period of at least five business days following Shareholders' approval of the De--Listing is required before the De--Listing may become effective. The De-Listing Resolution seeks the approval of Shareholders for the De--Listing. Assuming that the De-Listing Resolution is approved, it is proposed that the De--Listing will take place by 8.00 am on 15 February 2022.

Ordinary Share Dealing Following De--Listing

Following the De--Listing, there will be no market facility for dealing in the Ordinary Shares, no price will be publicly quoted for the Ordinary Shares and the transfer of Ordinary Shares will be subject to the provisions of the Articles. It is anticipated that the Articles will be amended following the De-Listing and will be more appropriate for those of a private company whose shares are not traded on a public market. This is likely to include provisions that any share transfers require the consent of the Directors. The Directors also do not intend to provide, seek or support any arrangements whereby the Ordinary Shares can be bought or sold on a matched bargain basis. Accordingly, interests in Ordinary Shares are unlikely to be readily capable of sale and, where a buyer is identified, it will be difficult to place a fair value on any such sale. Any Shareholders wishing to transfer their Ordinary Shares following the De-Listing should contact any Director of the Company at the registered office of the Company and by email at zoltav@diall.ru.

The Tender Offer

The Board recognises that not all Shareholders will be able or willing to continue to own Ordinary Shares following the De--Listing. Subject to the De-Listing Resolution being passed, Qualifying Shareholders will therefore have the opportunity to tender all or some of their Ordinary Shares at the Record Date pursuant to the Tender Offer.

Under the Tender Offer, ARA Capital Holdings Limited will purchase Ordinary Shares held by Qualifying Shareholders (representing approximately 12 per cent. of the Company's voting rights) from Qualifying Shareholders at 25 pence per Ordinary Share. The Tender Offer Price represents:

-- a premium of 11.1 per cent. over the closing mid--market price of an Ordinary Share on 17 December 2021, being the Latest Practicable Date; and

-- a premium of 8.3 per cent. over the thirty-day volume weighted average closing price of an Ordinary Share on 17 December 2021, being the Latest Practicable Date

The Tender Offer is open to Qualifying Shareholders on the register of the Company at the Record Date.

The Tender Offer is conditional on the passing of the De-Listing Resolution at the General Meeting, by the requisite majority (being the Tender Condition as specified in Part III ("Terms and Conditions of The Tender Offer")) in the Circular.

All Qualifying Shareholders who are on the Register at the Record Date are entitled, but not required, to tender some or all of their Ordinary Shares for purchase by ARA Capital Holdings Limited, acting as principal, at the Tender Offer Price.

The Tender Offer is to be effected by ARA Capital Holdings Limited (acting as principal and not as agent, nominee or trustee) purchasing Ordinary Shares from Qualifying Shareholders.

Qualifying Shareholders may tender some, all, or none of their holdings pursuant to the Tender Offer. Qualifying Shareholders are not obliged to tender any Ordinary Shares if they do not wish to do so. If no action is taken by Qualifying Shareholders, there will be no change to the number of Ordinary Shares that they hold and they will receive no cash as a result of the Tender Offer. A maximum of 16,762,099 Ordinary Shares (representing approximately 12 per cent. of the issued ordinary share capital of the Company) may be purchased under the Tender Offer, for a maximum aggregate cash consideration at the Tender Offer Price of approximately GBP4.2 million.

Qualifying Shareholders who elect not to tender their holdings pursuant to the Tender Offer will, on completion of the De--Listing, hold Ordinary Shares in an unquoted company. As set out above, there will be no market facility for dealing in the Ordinary Shares, no price will be publicly quoted for the Ordinary Shares and the transfer of Ordinary Shares will be subject to the provisions of the Articles. It is anticipated that the Articles will be amended following the De-Listing and will be more appropriate for those of a private company whose shares are not traded on a public market. This is likely to include provisions that any share transfers require the consent of the Directors. The Directors also do not intend to provide, seek or support any arrangements whereby the Ordinary Shares can be bought or sold on a matched bargain basis. Accordingly, interests in Ordinary Shares are unlikely to be readily capable of sale and, where a buyer is identified, it will be difficult to place a fair value on any such sale. Any Shareholders wishing to transfer their Ordinary Shares following the De-Listing should contact any Director of the Company at the registered office of the Company and by email at zoltav@diall.ru.

The attention of Qualifying Shareholders who are citizens or nationals of or resident in jurisdictions outside the United Kingdom and who wish to participate in the Tender Offer is drawn to paragraph 3 in Part III of the Circular. The Tender Offer is not being made, directly or indirectly, in or into any Restricted Jurisdiction.

The Tender Offer will open on 20 December 2021 (unless such date is altered) and tenders must not be submitted before that date. The Tender Offer will close at 1.00 p.m. on 31 January 2022.

Full details of the Tender Offer are set out in Part III of the Circular.

Circumstances in which the Tender Offer may not proceed

There can be no guarantee that the Tender Offer will take place. The Tender Offer is conditional on the passing of the De-Listing Resolution at the General Meeting by the requisite majority.

If the Tender Offer does not occur because the Tender Offer Condition is not satisfied, Qualifying Shareholders will not receive the Tender Offer Price for each of their Ordinary Shares and will not be able to achieve an exit at that stage from their investment in the Company.

Major Shareholders

The major Shareholders of the Company are supportive of the Proposals set out in this Document that the Company is undertaking.

Intentions of the Majority Shareholders following the Tender Offer and De--Listing

The Majority Shareholders have confirmed to the Company that they are not proposing, following completion of the Tender Offer and De-Listing, to seek any changes to the general nature or any other aspect of the Company's business or strategy.

The Majority Shareholders have also confirmed that they have no intention of making any significant changes in respect of any of the following:

   --    the future of the Company's (and the Company's subsidiaries') businesses; 

-- the location of the Company's (and the Company's subsidiaries') places of business, headquarters and headquarters' functions, beyond continuation of the offshoring of certain head office functions that is currently underway;

-- the continued employment of the Company's employees and management, including any material change in conditions of employment;

-- employer contributions into the Company's pension schemes, the accrual of benefits for existing members and the admission of new members; and

   --    the deployment of the fixed assets of the Company (or any of its subsidiaries). 

Under the current circumstances and notwithstanding any increase in the Majority Shareholders' holdings of Ordinary Shares, the Directors confirm that it is intended to continue to conduct the business of the Company in the same manner as it is currently conducted. It is possible that, in order to streamline the corporate structure of the Group and optimise tax payments, the Company may consider to redomicile to the Russian Federation in a few years' time, however no decision has been made by the Board on this matter as at the date of this announcement.

Corporate Governance

Following completion of the De--Listing, the Company does not intend to continue to comply with the QCA Corporate Governance Code.

The Company will also continue to communicate information about the Company to its Shareholders as required by law and the Company will continue to hold annual general meetings. The Company will also adopt new articles of association that are suitable for a private company whose shares are not traded on a public market. This is likely to include provisions that any share transfers require the consent of the Directors.

Cash Confirmation

The maximum cash consideration payable should all Qualifying Shareholders tender all of their Ordinary Shares in the Tender Offer at the Tender Offer Price is approximately GBP4.2 million which will be funded from ARA Capital Holdings Limited existing cash resources.

Proposals to be voted on at the General Meeting

For the purposes of effecting the Proposals the Resolutions will be proposed at the General Meeting, to be held at Sackville House, 40 Piccadilly, London W1J 0DR, United Kingdom at 12.00 p.m. on 19 January 2022. All of the Resolutions will be voted on by way of a poll vote at the General Meeting. The full texts of the Resolutions are set out in that notice, but set out below is a summary of the Resolutions which will be proposed at the General Meeting:

-- an authorisation for the Company to allot new Ordinary Shares in the event that ARA Capital Holdings Limited notifies the Company that it intends to convert the Loan Amount at the Loan Amount Conversion Rate;

-- that following receipt by the Company of any notice from ARA Capital Holdings Limited that the Loan Amount is to be converted at the Loan Amount Conversion Rate, and conditional on the first Resolution having been passed, the Company is given the authority to issue such number of Ordinary Shares as are required to convert the Loan Amount at the Loan Amount Conversion Rate outside of the pre--emption rights that are set out in the Company's Articles to enable the Company to capitalise the Loan; and

   --    that, in accordance with Rule 41 of the AIM Rules, the De-Listing is approved. 

Recommendations by the Board

As referenced above, the Company is not of a scale to attract sufficient interest from institutional and other investors and therefore it is difficult to create a more liquid market for its Ordinary Shares to effectively or economically utilise its quotation. Furthermore, the Company has been unable to fully utilise its listing on AIM to issue Ordinary Shares either as consideration or to raise fresh capital to execute acquisitions. The Directors also believe that De--Listing will allow the Company greater flexibility to execute its strategy whilst reducing its cost base. As such, the Board believes that the De--Listing is in the best interests of its Shareholders as a whole. The Directors unanimously recommend that you vote in favour of the De--Listing.

The Directors believe that the following points should be taken into account by Qualifying Shareholders when considering whether to retain their Ordinary Shares or accept the Tender Offer.

The price of the Tender Offer represents a premium of 11.1 per cent. to the Company's closing share price on 17 December 2021 (being the Latest Practicable Date) and a premium of approximately 8.3 per cent. to the Company's thirty-day volume weighted average share price of 23.08 pence to the Latest Practicable Date.

Upon De--Listing, the Company would no longer be subject to, and its Shareholders would consequently lose the protections afforded by, certain corporate governance regulations which apply to the Company currently. In particular, the Company would no longer be subject to the AIM Rules.

There can be no guarantee that, after the Tender Offer closes at 1.00 p.m. on 31 January 2022, the Board, or any other third party, would be prepared to make a subsequent tender offer to acquire any Ordinary Shares, or that one or more of the Majority Shareholders would be prepared to make any offer to acquire any Ordinary Shares in which they do not already have an interest. Nor can there be any guarantee as to the price of any such tender offer by the Company, any other third party, or potential offer by one or more of the Majority Shareholders.

Accordingly, any Qualifying Shareholder who does not accept the Tender Offer may find it difficult to sell their Ordinary Shares after the Tender Offer closes and the De--Listing takes effect, may not receive regular information from the Company, would not benefit from regulatory compliance with governance procedures, nor enjoy the protections afforded by the AIM Rules. Furthermore, there is no guarantee that the Company or any other purchaser would be willing to buy Ordinary Shares after the Tender Offer has closed and, if they were, any price offered might not reflect the underlying value of the Company's assets. Any Shareholders wishing to transfer their Ordinary Shares following the De-Listing should contact any Director of the Company Secretary at the registered office of the Company and by email at zoltav@diall.ru.

Qualifying Shareholders who anticipate greater value in the Ordinary Shares whilst recognising and being willing to accept the risks associated with remaining as a minority investor in an unlisted company controlled by the Majority Shareholders may wish not to accept the Tender Offer and to remain as minority Shareholders of a private company.

In the opinion of the Directors, Qualifying Shareholders should carefully consider their own individual circumstances in deciding whether or not to accept the Tender Offer. In the absence of any immediate prospect to sell their Ordinary Shares once the Tender Offer closes and the De--Listing has occurred, Qualifying Shareholders should balance their desire for a cash realisation now or in the immediate foreseeable future, against the uncertain future of remaining a holder of a private company, with the concurrent lack of transparency and protections that this affords them.

The Directors, who have been so advised by SP Angel as to the financial terms of the Tender Offer, consider the terms of the Tender Offer to be fair and reasonable. In providing advice to the Directors, SP Angel has taken into account the commercial assessments of the Directors. Accordingly, the Directors unanimously recommend that Qualifying Shareholders tender, or procure the tender, of their Ordinary Shares in the Tender Offer.

Notwithstanding the Directors' recommendation above, Qualifying Shareholders should only make a decision as to whether to tender all or any of their Ordinary Shares based on, among other things, their view of the Company's prospects and their own individual circumstances, including their tax position and are recommended to seek advice from their duly authorised independent advisers.

If Qualifying Shareholders are in any doubt about the action that they wish to take in respect of the Tender Offer, they should consult an independent financial adviser without delay.

EXPECTED TIMETABLE OF PRINCIPAL EVENTS

 
 Announcement of proposed De--Listing and Tender   20 December 2021 
  Offer, posting of the Circular, Proxy Form 
  and Tender Form to Qualifying Shareholders 
 Latest date for receipt of Proxy Form (to            12.00 p.m. on 
  be received no later than 48 hours before         17 January 2022 
  the General Meeting) 
 General Meeting(1)                                   12.00 p.m. on 
                                                    19 January 2022 
 Announcement of results of the General Meeting     20 January 2022 
 Latest time and date for receipt of Tender         1.00 p.m. on 31 
  Forms and TTE Instructions in relation to            January 2022 
  the Tender Offer (i.e. close of Tender Offer) 
 Closing Date                                       1.00 p.m. on 31 
                                                       January 2022 
 Record Date for Tender Offer                       6.00 p.m. on 31 
                                                       January 2022 
 Announcement of results of the Tender Offer        1 February 2022 
 CREST accounts credited in respect of Tender        by 14 February 
  Offer proceeds for uncertificated Ordinary                   2022 
  Shares 
 Cheques despatched in respect of Tender Offer       by 14 February 
  proceeds for certificated Ordinary Shares                    2022 
 Despatch of share certificates in respect           by 14 February 
  of any revised holdings of Ordinary Shares                   2022 
  following the Tender Offer, and any Ordinary 
  Shares held in CREST not tendered pursuant 
  to the Tender Offer 
 Earliest date for De--Listing (Cancellation        8.00 a.m. on 15 
  of admission of Ordinary Shares from AIM)           February 2022 
 

If any of the above times and/or dates change, the revised times and/or dates will be notified to Shareholders by announcement through a Regulatory Information Service.

All times are references to London time.

All events in the above timetable following the General Meeting are conditional, inter alia, upon the approval of the Resolutions. The De--Listing requires the approval of not less than 75 per cent. of the votes cast by Shareholders at the General Meeting.

Notes

1. The timetable assumes that there is no adjournment of the General Meeting. If there is an adjournment of the General Meeting, all subsequent dates are likely to be later than those shown.

2. Settlement of the consideration to which any Qualifying Shareholder is entitled pursuant to valid and complete in all respects tenders accepted by ARA Capital Holdings Limited will be made within 14 days of the date of the announcement of the results of the Tender Offer.

Enquiries:

 
 Zoltav Resources Inc.                      Tel. +44 (0)20 7390 
                                                           0234 
  Lea Verny, Non-executive Chairman       (via Vigo Consulting) 
 SP Angel Corporate Finance LLP (Nomad      Tel. +44 (0)20 3470 
  and Broker)                                              0470 
  Jeff Keating / Adam Cowl 
 Vigo Consulting                          Tel. +44 (0)20 7390 
  Ben Simons / Charlie Neish                      0234 
 

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December 20, 2021 02:00 ET (07:00 GMT)