Issue of Further Consideration Shares and Miles...

Issue of Further Consideration Shares and Milestone Payments

Armadale Capital Plc

Armadale Capital Plc / Index: AIM / Epic: ACP / Sector: Investment Company

20 November 2014

Armadale Capital Plc (‘Armadale’ or ‘the Company’)

Issue of Further Consideration Shares and Milestone Payments

Armadale, the AIM quoted investment company focused on natural resource projects in Africa, is pleased to announce that following the successful grant of the Mining Licences over the Mpokoto Gold Project in the Katanga Province of the Democratic Republic of Congo (‘Mpokoto’ or ‘the Project’), it has today issued further consideration shares in accordance with the original acquisition agreement for Mpokoto. In addition, the Company is making the first milestone payment following the publication of the positive results of the Expanded Scoping Study for Mpokoto which demonstrates a post-tax net present value of US$55.3m based upon a discount rate of 8% and a gold price of US$1,250/oz.

Overview

• Issue of 350 million ordinary shares in the capital of the Company (“Shares”) to the vendors of Mpokoto, following the grant of the Mining Licences over the Project
• Issue of a further 60 million Shares, being the First Milestone Shares, due upon the publication of the Expanded Scoping Study
• Issue of 65 million Shares to key Kisenge employees
• All new Shares subject to an orderly market agreement whereby the holders undertake not to dispose of the Shares for a period of one year save with the consent of the Company and its nominated adviser
• Grant of management options

Peter Marks, Chairman of Armadale, said: “Following the successful grant of the Mining Licences for Mpokoto and the positive results arising from the recent Expanded Scoping Study we have today issued the further Shares to the vendors of Mpokoto in accordance with the acquisition agreement entered into in November 2013.

“The issue of the Shares demonstrates the progress that has been made with Mpokoto over the last year and the completion of some key milestones including three upgrades to the JORC resource associated with the Project, the publication of two very positive scoping studies demonstrating the financial robustness of the Project at low gold prices and the grant of Mining Licences over the Project. I look forward to continued progress and being able to report on further positive results arising from the impending metallurgical test work and expanded drilling programme, expected in the first quarter next year.”

Issue of Shares

The Company has today issued 350 million Shares to the vendors of Mpokoto (‘Vendors’) in accordance with the acquisition agreement dated 15 November 2013 (the ‘2013 Acquisition Agreement’), as a result of the successful grant of the Mining Licences over the Project.

In addition, a further 60 million Shares, being the First Milestone Shares, have today been issued to the Vendors following the publication of the positive results of the Expanded Scoping Study. As part of the 2013 Acquisition Agreement, up to a further 160 million Shares may be issued on completion of further milestones, being the demonstration of a JORC Reserve and the commencement of production of gold.

As indicated at the time of the recent acquisition of Kisenge, a company owned by certain key employees of Kisenge has today entered into a consultancy agreement pursuant to which they have been issued 65 million Shares in consideration for a debt of £65,000 due to them for services provided in relation to Mpokoto.

All of the 475 million Shares that have today been issued are subject to orderly market arrangements whereby the holders of these Shares have undertaken to the Company that, for a period of one year, they will not dispose of the Shares, save with the consent of the Company and its nominated adviser.

Grant of Options

In line with ongoing development of Mpokoto and successful completion of development milestones, the board has resolved to make an annual grant of options (‘Options’) today over 210 million Shares to directors, management and employees of Armadale. 150 million Options are being granted to the Directors of the Company as detailed below.

The Options have an exercise price of 0.1p per Share, being a 20% premium to the current prevailing mid-market price per Share, and are exercisable (in whole or in part) at any time up to the tenth anniversary of the date of grant after which the Options will lapse.

Following this grant, the directors of the Company hold the following Options and Shares in the Company:

Director

Â

Number of Options

Â

Date of Grant

Â

Vesting Period (years)

Â

Exercise Price

Â

Number of Shares currently held

Â

Percentage of Voting Rights currently held

Peter Marks

50,000,000

1/10/13

10

0.1p

41,695,400

1.00%

50,000,000

19/11/14

10

0.1p

Justin Lewis

50,000,000

1/10/13

10

0.1p

93,000,000

2.22%

100,000,000

19/11/14

10

0.1p

The Company now has a total of 353,000,000 outstanding Options over Shares representing 8.42% per cent. of the total current issued share capital of the Company.

Admission to AIM

The Company has applied for admission of 475,000,000 new Shares to trading on AIM. Dealings are expected to become effective on 25 November 2014 (‘Admission’). Following Admission, the Company will have 4,189,901,168 Shares in issue with each Share carrying the right to one vote. There are no Shares currently held in treasury. The total number of voting rights in the Company therefore will be 4,189,901,168 and this figure may be used by shareholders as the denominator for the calculations by which they determine if they are required to notify their interest in, or a change to their interest in, the Company under the Financial Conduct Authority’s Disclosure Rules and Transparency Rules.

**ENDS**

Enquiries:

Armadale Capital

Peter Marks, Chairman [phone]

Nomad and broker: finnCap Limited

Stuart Andrews [phone]

Christopher Raggett

Press relations: St Brides Media & Finance Ltd.

Susie Geliher [phone]

Charlotte Heap

Notes

Armadale Capital Plc is focussed on investing in and developing a portfolio of investments, targeting the natural resources and/or infrastructure sectors in Africa. The Company, led by a team with operational experience and a strong track record in Africa, has a strategy of identifying high growth businesses where it can take an active role in their advancement.

Armadale is focused on the development of the Mpokoto Gold project in the Democratic Republic of the Congo, in which it owns an 80% interest. Armadale also currently holds approximately a 30% interest in Mine Restoration Investments Ltd, a South African listed company, which aims to develop profitable operations in South Africa through the briquetting and sale of coal fines in KwaZulu Natal, as well as a number of other quoted investments.

More information can be found on the website www.armadalecapitalplc.com.