Tri-Star Resources Plc - Notice of AGM and Intention to Delist

Tri-Star Resources Plc - Notice of AGM and Intention to Delist

PR Newswire

London, November 8

Tri-Star Resources PLC / AIM: TSTR / Sector: Natural Resource

9 November 2020

Tri-Star Resources plc ("Tri-Star", "TSTR" or the "Company")

Notice of AGM

Intention to de-list from AIM

Tri-Star Resources plc (AIM: TSTR), the minerals processing company, announces that its Annual General Meeting ("AGM") will be held at the offices of Odey Asset Management LLP at 18 Upper Brook Street, London, W1K 7PU at 10.00a.m. on 2 December 2020. Given the current restrictions on public gatherings, shareholders will not be permitted to attend the AGM in person, other than for the purposes of establishing a quorum, and each of the Resolutions to be considered at the meeting will be voted on by way of a poll.

Further to the announcement of 3 November 2020, the Notice of AGM contains details of the proposed cancellation of admission of its Ordinary Shares to trading on AIM ("Cancellation"), expected to occur at 7.00a.m. on 10 December 2020. The Cancellation is conditional, pursuant to Rule 41 of the AIM Rules, upon the approval of not less than 75 per cent. of the votes cast by Shareholders at the AGM.

The Notice of AGM and Annual Report and Audited Financial Statements for the year ended 31 December 2019, will be posted to shareholders today and will be available on the Company's website at www.tri-starresources.com.

A copy of the expected timetable and letter from Adrian Collins, Non-Executive Chairman of the Company, is set out below.

Certain information contained in this announcement would have been deemed inside information for the purposes of Article 7 of Regulation (EU) No. 596/2014 until the release of this announcement.

**ENDS**

For further information, please visit www.tri-starresources.com or contact:

Tri-Star Resources plc David Facey, CEO/ CFO	c/o SBP Tel: [phone]
St Brides Partners (Financial PR) Isabel de Salis / Beth Melluish	Tel: [phone]
SP Angel Corporate Finance (Nominated Adviser) Jeff Keating/ Caroline Rowe	Tel: [phone]
finnCap Ltd (Broker) Christopher Raggett	Tel: [phone]

EXPECTED TIMETABLE

	2020
Announcement of proposed Cancellation	3 November
Notice provided to the London Stock Exchange to notify it of the proposed Cancellation	4 November
Publication and posting of this document	9 November
Latest time and date for receipt of electronic votes or completed paper proxy forms to be valid at the Annual General Meeting	10.00 a.m. on 30 November
Annual General Meeting	10.00 a.m. on 2 December
Announcement of results of Annual General Meeting	2 December
Expected last day of dealings in Ordinary Shares on AIM	9 December
Expected date of Cancellation and Re-registration	7.00 a.m. on 10 December

Proposed cancellation of admission of Ordinary Shares to trading on AIM

Proposed re-registration as a private limited company

and

Notice of Annual General Meeting

1. Introduction

As announced by the Company on 3 November 2020, the Board has concluded that it is in the best interests of the Company and its Shareholders to cancel the admission of the Ordinary Shares to trading on AIM. Pursuant to Rule 41 of the AIM Rules, the Company (through its nominated adviser, SP Angel) has notified the London Stock Exchange of the date of the proposed Cancellation. In addition, the Board has concluded that, subject to the approval of Shareholders and subject to the Cancellation, the Company should re-register as a private limited company.

Implementation of the Cancellation is conditional on the Cancellation Resolution being passed at the Annual General Meeting to be held on 2 December 2020 at the offices of Odey Asset Management LLP at 18 Upper Brook Street, London, W1K 7PU at 10.00 a.m. The Notice of AGM containing the full text of the Resolutions is set out at the end of this document. Subject to the Cancellation Resolution being passed at the Annual General Meeting, it is anticipated that the Cancellation will become effective at 7.00 a.m. on 10 December 2020.

The purpose of this document is to provide Shareholders with information on the background to and reasons for the Cancellation and Re-registration, explain the consequences of the Cancellation and Re-registration and why the Directors unanimously consider the Cancellation and Re-registration to be in the best interests of the Company and its Shareholders as a whole and seek Shareholders' approval for the Resolutions.

2. Background to and reasons for the Cancellation

The Company's principal asset and focus of activities is its interest in SPMP. SPMP is an Omani company developing the OAR. As announced on 9 July 2020, by the end of the second quarter of 2020, the individual parts of the plant had been operating for short periods of time at 50 per cent. of capacity.

At the end of 2019 and in January 2020, IAC injected a further USD 32 million in SPMP and DNR a further USD 8 million ("December 2019 Funding"). The terms on which this funding would be made had not been agreed with Tri-Star.

As announced on 8 April 2020, IAC instituted arbitration proceedings ("Proceedings") in order to try and force the December 2019 Funding to be treated as equity on a valuation to be agreed only after the event. Tri-Star had a veto right over this and, based on legal advice, the Board were confident that it would prevail.

As announced on 3 November 2020, IAC, Tri-Star, DNR and SPMP have entered into a settlement agreement ("Settlement Agreement") in full and final settlement of the Proceedings, pursuant to which, among other things, IAC and DNR have agreed to provide sufficient further funding in order for the plant to reach completion, without further equity dilution to Tri-Star and all sums invested to date are converted into equity and equity loans ("Equity Loans") proportionately. The Equity Loans are zero coupon, undated and repayable at the option of SPMP, subordinated but ranking above equity.

As a result of the transactions contemplated by the Settlement Agreement, Tri-Star's percentage holding in SPMP will be diluted to approximately 16.3 per cent. In addition, Tri-Star will hold USD 30.8 million of Equity Loans (comprising 16.3 per cent of the total balance of Equity Loans owed by SPMP). The balance of equity and Equity Loans will be held by IAC and DNR.

Tri-Star's claim to a final USD 2 million payment due from the assignment of the intellectual property rights to SPMP will be settled by USD 0.5 million payable in cash and the balance forming part of Tri-Star's total funding of SPMP. A further sum of USD 100,000 representing settlement for other outstanding amounts is to be paid in cash to Tri-Star by SPMP.

It is envisaged that future SPMP funding until plant completion will be sought first from third party sources, failing which shareholders may fund SPMP with subordinated non-convertible debt with a coupon of 20 per cent ("New Loans"). IAC has agreed to fund Tri-Star's share of the New Loans thereby avoiding further dilution of TSTR's equity interest.

Tri-Star's interest may only be diluted if shareholders with 75 per cent or more of the voting rights agree: (a) that capital is required to expand the project in a material way; (b) to apply for a listing on a recognised stock exchange which results in the free float being at least 25 per cent of the issued share capital; (c) that an independent third party investor injects equity in the business on an arms-length basis; or (d) in order to continue compliance with bank facility covenants, the banks require any of the New Loans to be converted to equity.

With effect from the date of the Settlement Agreement, Tri-Star ceased to have representation on the Board of Managers of SPMP and all board and shareholder reserved matters relating to the operations of SPMP will cease to require unanimous board or shareholder approval respectively.

The bank guarantee provided by Tri-Star, IAC and DNR in favour of Bank Nizwa SAOG and Alizz Islamic Bank SAOG remains in place, although all parties have agreed to seek to renegotiate the terms to ensure that it is released once the plant is commissioned. Tri-Star's exposure to the guarantee has been reduced to reflect its decreased shareholding of 16.3 per cent. As a result of the Settlement Agreement, which provides for the ongoing funding of SPMP, it is the Board's view that the risk of the guarantee being called has been significantly reduced. The current expected date of completion of the plant is in the first half of 2021 at which point the guarantee is expected to be expunged.

Consequently, the Directors have conducted a review of the benefits and challenges of maintaining the Company's listing on AIM and after careful consideration, have concluded that it is no longer in the best interests of the Company and its shareholders.

The main reasons for coming to this conclusion are:

• the Company will cease to be substantively involved in the management of SPMP and will effectively become a passive investor in SPMP. The Directors believe that such investment will not justify the same level of engagement, as is required in respect of a company admitted to trading on AIM;

• the ongoing additional costs of maintaining Admission (approximately £250,000 per annum) are significant for a company of the Company's size and the Directors believe that such costs will not be justified once the Company ceases to be substantively involved in the management of SPMP;

• the trading volumes in respect of the Shares are relatively low for an AIM listed company, which prevents Shareholders from trading in meaningful volumes or with any frequency; and

• the Company intends to implement Matched Bargain Facility shortly following Cancellation. Once implemented, the Matched Bargain Facility will, in the Directors' opinion, offer Shareholders a suitable substitute trading mechanism in the Ordinary Shares.

Taking all of these factors into account, the Directors believe that Cancellation is in the best interests of the Company and its Shareholders as a whole.

3. Principal effects of the Cancellation and Re-registration

The principal effects of Cancellation, which have been considered by the Directors, will be:

• there will no longer be a public market mechanism for Shareholders to trade in the Ordinary Shares and no price will be publicly quoted for the Ordinary Shares;

• the Ordinary Shares will remain freely transferable and the Company intends to implement a Matched Bargain Facility in order to give Shareholders an opportunity to trade the Ordinary Shares following Cancellation (see paragraph ?7 below for further details). The Ordinary Shares may, however, be more difficult to trade compared to shares of companies trading on AIM;

• it is possible that, following publication of this document, the liquidity and marketability of the Ordinary Shares may be significantly reduced and the value of such shares may be consequently adversely affected;

• it may be more difficult for Shareholders to determine the market value of their investment in the Company at any given time;

• whilst the Company's CREST facility will remain in place following the Cancellation, the Company's CREST facility may be cancelled in the future and, although the Ordinary Shares will remain transferable, they may cease to be transferable through CREST. In this instance, Shareholders who hold Ordinary Shares in CREST will receive share certificates;

• the AIM Rules will no longer apply to the Company and, accordingly, Shareholders will no longer be afforded the protections given by the AIM Rules. In particular the Company will not be bound to:

(i) make any public announcements of material events, or to announce interim or final results;

(ii) comply with any of the corporate governance practices applicable to AIM companies;

(iii) announce substantial transactions and related party transactions; or

(iv) comply with the requirement to obtain shareholder approval for reverse takeovers and fundamental changes in the Company's business; or

(v) comply with AIM Rule 26, obliging the Company to publish prescribed information on its website;

• the Company will cease to retain a nominated adviser and broker;

• as an unlisted company, the Company will be subject to less stringent accounting disclosure requirements;
• the Company would no longer be subject to the Market Abuse Regulation (Regulation S96/2014) regulating inside information;
• the Company will no longer be subject to the Disclosure Guidance and Transparency Rules and will therefore no longer be required to publicly disclose any change in major shareholdings in the Company;

• the Relationship Agreement, pursuant to which the Odey Funds, in their capacities as substantial shareholders, gave various undertakings to the Company and SP Angel regarding the relationship between the Odey Funds, their associates and the Company, will terminate in accordance with its terms;

• as from the date of Cancellation, stamp duty will be due on transfers of shares and agreements to transfer shares unless a relevant exemption or relief applies; and

• the Cancellation might have either positive or negative taxation consequences for Shareholders. For those Shareholders that hold Ordinary Shares through an ISA, see further below.Shareholders who are in any doubt about their tax position should consult their own professional independent adviser immediately.

Following the Re-registration, as a private company, the Company may achieve greater flexibility in the following areas:

• the period for the preparation of accounts would be extended from six to nine months following the end of the financial year;

• it would be possible to obtain Shareholders' resolutions via written resolutions, rather than via physical meetings;

• the Company would no longer be required to have a minimum of two directors;

• the Company would no longer be required to have a company secretary; and

• the Company would no longer be required to hold an annual general meeting, and if the Company chooses to hold one, an annual general meeting can be held on 14 clear days' notice rather than a 21 clear days' notice.

These considerations are not exhaustive and Shareholders should seek their own independent advice when assessing the likely impact of the Cancellation on them.

Shareholders should be aware that if Cancellation takes effect, they will at that time cease to hold Ordinary Shares in a company whose shares are admitted to trading on AIM and the matters set out above will automatically apply to the Company from the date of Cancellation.

After the Cancellation, the Company will continue to comply with applicable statutory requirements. Subject to the Re-registration occurring, Shareholders should also note that the Code will continue to apply to the Company for the period of 10 years from the date of Cancellation.

4. Ordinary Shares held through an ISA account

The Ordinary Shares will cease to be eligible to be held within an ISA upon the Cancellation taking effect. An ISA manager will have to either sell Ordinary Shares held in a Shareholder's ISA or transfer them to the Shareholder to be held outside an ISA, within 30 calendar days of the Cancellation.

When the title of an investment in an ISA is transferred from an ISA manager to an investor, the investor is deemed to have sold the investment for a market value sum and immediately reacquired it for the same amount. Any notional gain on the deemed sale is exempt from charge. Any future capital gains or losses are calculated by reference to the value of the shares when they left the ISA. This is the combined effect of regulation 22 and 34 of the Individual Savings Account Regulations 1998. It is not, however, clear how this general tax treatment applies when shares are transferred out of an ISA after a delisting.

This summary is for general information purposes only. It is not intended to constitute tax or other advice and should not be relied on or treated as a substitute for specific advice relevant to a Shareholder's specific circumstances. Shareholders should consult their own professional advisers as soon as possible.

5. Takeover Code

Introduction

The Code currently applies to the Company and, subject to the Re-registration occurring, will do so for 10 years following the Cancellation, for as long as the Company continues to be considered by the Panel to have its place of central management and control in the United Kingdom, the Channel Islands or the Isle of Man. Subject to the Re-registration occurring, once the 10 year period referred to has expired, the Code will not apply to the Company and will not apply to any offer made to Shareholders to acquire their Ordinary Shares subsequent to the 10 year period following the Re-registration.

Shareholders should note that, if the Cancellation becomes effective (and subject to the Re-registration occurring), after the expiry of 10 years from the date of the Cancellation, they will not receive the protections afforded by the Code if there is a subsequent offer to acquire their Ordinary Shares.

Brief details of the Panel, the Code and the protections given by the Code are described below. Before giving your consent to the re-registration of the Company as a private company, you may want to take independent professional advice from an appropriate independent financial adviser.

The Code

The Code is issued and administered by the Panel. The Company is a company to which the Code applies and its shareholders are accordingly entitled to the protections afforded by the Code.

The Code and the Panel operate principally to ensure that shareholders are treated fairly and are not denied an opportunity to decide on the merits of a takeover and that shareholders of the same class are afforded equivalent treatment by an offeror. The Code also provides an orderly framework within which takeovers are conducted. In addition, it is designed to promote, in conjunction with other regulatory regimes, the integrity of the financial markets.

The General Principles and Rules of the Code

The Code is based upon a number of General Principles which are essentially statements of standards of commercial behaviour. For your information, these General Principles are set out in Part 1 of Appendix A. The General Principles apply to all transactions with which the Code is concerned. They are expressed in broad general terms and the Code does not define the precise extent of, or the limitations on, their application. They are applied by the Panel in accordance with their spirit to achieve their underlying purpose.

In addition to the General Principles, the Code contains a series of Rules, of which some are effectively expansions of the General Principles and examples of their application and others are provisions governing specific aspects of takeover procedure. Although most of the Rules are expressed in more detailed language than the General Principles, they are not framed in technical language and, like the General Principles, are to be interpreted to achieve their underlying purpose. Therefore, their spirit must be observed as well as their letter. The Panel may derogate or grant a waiver to a person from the application of a Rule in certain circumstances.

Giving up the protection of the Code

A summary of the protections afforded to Shareholders by the Code which will be lost is set out in Part 2 of Appendix A. You are encouraged to read this information carefully as it outlines certain important protections which,subject to the Re-registration occurring,will cease to apply 10 years following Cancellation.

6. Cancellation process

Under the AIM Rules it is a requirement that, unless the London Stock Exchange otherwise agrees, the Cancellation must be conditional upon the consent of not less than 75 per cent. of votes cast by the Shareholders, given in a general meeting. The Company is calling an Annual General Meeting, notice of which is set out at the end of this document, and will propose a special resolution to approve the Cancellation.

Under the AIM Rules, the Company is required to give the London Stock Exchange at least 20 Business Days' notice of Cancellation and separately notify shareholders that it wishes to cancel the admission of its shares to trading on AIM. Accordingly, the Directors (through the Company's nominated adviser, SP Angel) have notified the London Stock Exchange of the Company's intention, subject to the Cancellation Resolution being passed at the Annual General Meeting, to cancel the admission of the Ordinary Shares to trading on AIM on 10 December 2020.

If the Cancellation Resolution is passed at the Annual General Meeting, it is proposed that the last day of trading in Ordinary Shares on AIM will be 9 December 2020 and that Cancellation will take effect at 7.00 a.m. on 10 December 2020.

Upon the Cancellation becoming effective SP Angel will resign as nominated adviser to the Company and the Company will no longer be required to comply with the AIM Rules.

7. Transactions in the Ordinary Shares following Cancellation

Shareholders should note that they are able to trade in the Ordinary Shares on AIM prior to the Cancellation.

The Directors are aware that certain Shareholders may be unable or unwilling to hold Ordinary Shares if the Cancellation is approved and becomes effective. Such Shareholders should consider selling their interests in the market prior to the Cancellation becoming effective.

In addition, the Directors are aware that, should the Cancellation be approved by Shareholders, it would make it more difficult to buy and sell Ordinary Shares in the Company following the Cancellation. Therefore, the Company intends to implement a Matched Bargain Facility shortly after the Cancellation to assist Shareholders to trade in the Ordinary Shares.

Should the Cancellation become effective and the Company put in place a Matched Bargain Facility, details will be made available to Shareholders on the Company's website at www.tri-starresources.com.

Shareholders will continue to be able to hold their shares in uncertificated form (i.e. in CREST) and should check with their existing stockbroker whether they are willing or able to trade in unquoted shares.

8. Board composition following Cancellation

Following the Cancellation, Adrian Collins, David Facey and David Fletcher will resign from the Board and, subject to the approval of Shareholders at the AGM, Claire Holdsworth will join the Board as its sole director.

Claire Holdsworth is the General Counsel for OAM. She has been part of the management team at OAM for over 16 years. Claire is a Solicitor of the Supreme Court and was admitted to the Law Society in 1999.

9. Annual General meeting and action to be taken

AGM and Resolutions

The Annual General Meeting will be held at the offices of Odey Asset Management LLP at 18 Upper Brook Street, London, W1K 7PU at 10.00 a.m. on 2 December 2020 at which the following resolutions will be proposed:

• Resolution 1 - to receive the reports and accounts for the year ended 31 December 2019
• Resolution 2 - to re-appoint David Fletcher as a director, although he will resign upon the Cancellation becoming effective.
• Resolution 3 - to appoint Claire Holdsworth as a director, conditional upon the Cancellation.
• Resolution 4 - to reappoint Grant Thornton UK LLP as auditors of the Company and to authorise the directors to determine their remuneration.
• Resolution 5 - to approve the Cancellation.
• Resolution 6 - to approve the Re-registration and to adopt new articles of association suitable for a private limited company. A copy of the New Articles is available on the Company's website, details below. The New Articles continue to permit the free transferability of Ordinary Shares. The New Articles contain a drag along right, pursuant to which Shareholders selling more than 50% of the Company's voting share capital will be able to require that the other Shareholders sell their shares in the Company to the proposed buyer(s) on the same terms.

The Cancellation, Re-registration and adoption of the New Articles will require the approval of not less than 75 per cent. of the votes cast by Shareholders at the General Meeting. The Odey Entities, which between them hold 68,883,299 Ordinary Shares representing over 72% of the Company's voting share capital have indicated to the Board that they intend to vote in favour of all the Resolutions.

Action to be taken

You are requested to vote electronically through the share portal available at www.signalshares.com by no later than 10.00 a.m. on 30 November 2020 and, where a paper proxy form is sent upon request, to complete and return such proxy form in accordance with the instructions printed on the form. To be valid, electronic votes should be submitted by no later than 10.00 a.m. on 30 November 2020 and, where a paper proxy form is sent upon request, such proxy form should be completed, signed and returned as soon as possible and, in any event, so as to reach the Company's registrars, Link Asset Services, PXS1, 34 Beckenham Road, Beckenham, Kent BR3 4ZF by no later than 10.00 a.m. on 30 November 2020.

COVID-19

The UK Government has recently tightened the restrictions on gatherings, subject to limited exemptions. The Board has therefore concluded that shareholders should not be permitted to attend the Annual General Meeting other than for the purposes of establishing the quorum for the meeting. Equally, our advisers and other guests will not be invited to attend the Annual General Meeting.

Given that in the present circumstances shareholders will not be permitted to attend the Annual General Meeting, the Chairman of the meeting will propose that each of the Resolutions to be considered at the meeting should be voted on by way of a poll, so that all voting rights exercised by Shareholders who are entitled to do so at the Annual General Meeting will be counted.

Whilst Shareholders will not be permitted to attend the Annual General Meeting, they will still be able to ensure their votes are counted by submitting their proxies in advance. Shareholders wishing to appoint a proxy for this purpose should appoint the Chairman of the meeting. Any Shareholder appointing someone other than the Chairman of the meeting to be their proxy, should note that person will not be permitted to attend the Annual General Meeting and will therefore be unable to cast the Shareholder's vote.

As the situation and resulting government guidance has the ability to change rapidly, Shareholders should note that further changes may need to be put in place at short notice in relation to the Annual General Meeting. Updates on the status of the Annual General Meeting and any changes to the proceedings of the meeting will be noti?ed by announcement through a regulatory information service.

Any Shareholders wishing to ask questions relating to the Resolutions, are requested to email their questions to the Company (at [e-mail]) by no later than 10:00 a.m. on 30 November 2020. Answers will be posted on the Company's website by no later than 5:00 p.m. on 2 December 2020.

Copies of this document and the proposed New Articles are available on the Company's website at www.tri-starresources.com.

10. Consent to Electronic Communications

The Company's articles of association permit the Company to supply certain notices, documents and information to its members by making them available on the Company's website. This means that the Company has the ability to publish documents such as its annual report and any notice of general meeting on its website instead of printing and posting them out to members. Reducing the number of communications sent by post will not only result in cost savings for the Company, but it will also reduce the impact that unnecessary printing and distribution of documents has on the environment.

Company law requires that members are asked individually to consent to this method of publication. We are, therefore, seeking your agreement to receive future documents and information generally via the Company's website as a default method of communication, as per the enclosed form of consent.

If you consent to website publication, you will no longer receive hard copies of any documents and information in the post. You will instead be notified each time that the Company places a communication with members on its website. This notification will be sent to you by post. If you would prefer to receive such notifications by email, you will need to provide us with your email address.

Notwithstanding your consent to website publication there may be particular circumstances in which the Company needs to, or is required to, send documents or information to you in hard copy form, in which case the Company reserves the right to do so.

Action to be taken

If you wish to consent to the website publication of documents and information generally, you do not need to take any further action. If, however, you do not wish to consent to website publication and would prefer to continue to receive hard copies of future documents and information through the post, you must complete the enclosed electronic communications preference form and return it to the appropriate address. If you do not return the form within 28 days from the date of this letter, you will be deemed to have consented to website publication and you will no longer receive hard copies in the post.

Even if you consent, or are deemed to have consented, to website publication, you can always request a printed copy of any document or information from the Company at any time. You can also change your instructions at any time by contacting the Company's Registrar, Link Asset Services:

By phone - UK - 0371 664 0391, from overseas call [phone]. Calls are charged at the standard geographic rate and will vary by provider. Calls outside the United Kingdom will be charged at the applicable international rate. We are open between 09:00 - 17:30, Monday to Friday excluding public holidays in England and Wales.

By email - [e-mail]

By post - Link Asset Services, The Registry, 34 Beckenham Road, Beckenham, Kent, BR3 4TU.

You can manage your shareholding online at www.signalshares.com. This includes adding or amending address and bank mandate details as well as updating your communication preference. You will need your Investor Code to register which can be found on your share certificate.

You can also submit your proxy vote online at www.signalshares.com.

10. Recommendation

The Directors consider that Cancellation is in the best interests of the Company and Shareholders as a whole.The Directors therefore unanimously recommend that you vote in favour of the Cancellation Resolution as they themselves intend to do in respect of their aggregate beneficial shareholdings of 94,902 Ordinary Shares, representing 0.10 per cent. of the total number of issued shares in the Company.

Yours faithfully
Adrian Collins
Non-Executive Chairman