Issue of Convertible Loan Notes and Loans

Keras Resources plc (AIM: KRS) is pleased to announce that it has on 24 May 2024 restructured its short term liabilities of US$900,000 incurred in the 2022 acquisition of the outstanding 49% in Falcon Isle Resource Corp and Falcon Isle Holdings LLC (together "Falcon Isle") into a US$1,525,000 (GBP1,195,610) 4 year loan and convertible loan, comprising US$1,325,000 (GBP1,038,808) in new cash funds and US$200,000 (GBP156,801) in capitalised Directors outstanding fees. The additional funds will be used to pay US$800,000 consideration due to the vendor of Falcon Isle on 1 July 2024, US$100,000 for a final severance payment to the former CEO of Falcon Isle, and for growth projects and general working capital. The restructure ensures that the Company can meet its current obligations without negatively impacting the long-term growth profile at the high-grade organic phosphate business in Utah, USA.

The cash funding includes funding from the Diane H. Grosso Credit Shelter Trust , an associate of 17% shareholder Chris Grosso with Directors Russell Lamming and Graham Stacey capitalising US$100,000 (GBP78,401) of outstanding fees each due from the Company (50% in the form of Convertible Loans and 50% in the form of the Loans).

Further details of dealings by Russell Lamming and Graham Stacey are set out in the Appendix.

The funding comprises:-

· 4 year convertible loan notes totalling GBP 597,805 (US$762,500), at a 4% per annum interest rate and conversion price of GBP 0.0275 issued by Keras ("Convertible Loans"). After 12 months, if the 30 day volume weighted Keras share price is GBP 0.09 (British pounds sterling) or greater, Keras has the option to call the conversion of the Convertible Loans. The Convertible Loans are being made to Keras and may be converted at any time by notice given by the holders, interest will be compounded annually and included with the amount being converted, or paid at the end of the 4 year loan period if not converted; and

• 4 year Promissory Notes totalling US$762,500 (GBP597,805) at an 8% per annum interest rate repayable after 4 years. The Promissory Notes are being made to Falcon Isle Resource Corp which has the right to repay the loans, without penalty, after 2 years (the "Loans"). Interest on the loans is payable annually on the anniversary of the notes.

The Directors of the Company have the authority to issue shares for cash up to a maximum nominal value of £165,000. The total nominal value required for the restructuring, including interest is £254,308, therefore the funding will be completed in 2 tranches. Tranche 1, using existing authorities requires a nominal value of £156,801 and for Tranche 2 the Company will propose a resolution at the 2024 AGM, expected to be held at the end of July 2024 authorising the Directors to issue shares for cash up to a maximum nominal value of £97,507 (which includes £36,924 for interest accrued over the 4 year tenure).

Related Party Transaction

Russell Lamming, Graham Stacey, and 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")), are considered to be Related Parties of the Company as defined under the AIM Rules, and the provision of the Convertible Loan and Loan set out above are therefore deemed to be Related Party Transactions pursuant to AIM Rule 13 of the AIM Rules for Companies.

The Directors of the Company independent from the Convertible Loan and Loan, being Brian Moritz 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 and Loan are fair and reasonable insofar as the Company's Shareholders are concerned.

Graham Stacey, CEO of Keras, commented, "The restructuring of the Company's short term liabilities into a 4 year loan and convertible loan, which reduces the shareholder dilution associated with a simple equity raise is significant for the Company as it matches its debt structure to the growth profile of our growing high grade phosphate business and specifically to the initial term of the Phosul Utah LLC joint venture announced in January 2024. The participation of Company directors and the continued support from Chris Grosso is a further endorsement of the Company's achievements over the past 12 months as it has transitioned into a fully focussed North American business targeting the robust organic fertiliser market.

I look forward to updating shareholders on progress at our newly acquired, stand alone processing facility located in Delta, Utah as we now move towards the final commissioning phase of the integrated milling and granulator plant."