TIDMTRP
RNS Number : 5278X
Tower Resources PLC
01 September 2020
THIS ANNOUNCEMENT IS NOT FOR RELEASE, PUBLICATION OR
DISTRIBUTION, DIRECTLY OR INDIRECTLY, IN WHOLE OR IN PART, IN, INTO
OR FROM THE UNITED STATES, CANADA, AUSTRALIA, THE REPUBLIC OF SOUTH
AFRICA OR JAPAN OR ANY OTHER JURISDICTION WHERE TO DO SO WOULD
CONSTITUTE A BREACH OF THE RELEVANT SECURITIES LAWS OF SUCH
JURISDICTION.
This announcement does not constitute a prospectus or offering
memorandum or an offer in respect of any securities and is not
intended to provide the basis for any decision in respect of Tower
Resources PLC or other evaluation of any securities of Tower
Resources PLC or any other entity and should not be considered as a
recommendation that any investor should subscribe for or purchase
any such securities.
1 September 2020
Tower Resources plc
Shard Merchant Capital Loan Facility Agreement
Extension of Pegasus Loan Facility
Issue of Shares and Warrants in connection with Loans
Subscription to raise US$200,000
Tower Resources plc (the "Company" or "Tower" (TRP.L, TRP LN)),
the AIM listed oil and gas company with its focus on Africa, is
pleased to announce that, further to the Company's financing update
announcement on 14 August 2020, the Company has on 28 August 2020
agreed a six-month Loan Facility (the "Shard Facility") of
US$500,000 with Shard Merchant Capital Ltd ("Shard"). The terms of
the Shard Facility include the issue of 31,446,541 attached
three-year warrants at a strike price of 0.6 pence and 5,761,198
shares to pre-pay interest .
The Company has also, on 28 August 2020, agreed a further
six-month extension to its existing US$750,000 Loan Facility (the
"Pegasus Loan Facility") with Pegasus Petroleum Limited
("Pegasus"), as part of which it will issue 47,169,811 attached
three-year 0.6 pence warrants, and Pegasus has agreed to subscribe
for 37,854,971 shares to convert the current accrued interest on
the Pegasus Loan Facility into shares, and to pre-pay interest (the
"Pegasus Extension").
The aggregate number of shares to be issued in consideration of
accrued and pre-paid interest for the Shard Facility and Pegasus
Loan Facility is therefore 43,616,169 shares ("Loan Facility
Interest Shares").
The Company also announces a subscription (the "Subscription")
agreed on 28 August 2020 to raise gross proceeds of US$ 200,000
through a subscription of approximately 38,407,989 new ordinary
shares of 0.001 pence each (the "Subscription Shares") at a
subscription price of 0.393 pence per Subscription Share (the
"Subscription Price") to clients of Shard. The Subscription Price
of 0.393 pence per share represents a discount of 9.7 % to the
midpoint price of the Company's shares at the close of trading on
28 August 2020.
The purpose of the Shard Facility, Pegasus Extension and the
Subscription is to cover working capital while the Company
finalises funding arrangements for the drilling of the NJOM3 well
on the Thali licence as highlighted in the Company's 20 August 2020
announcement.
Shard Facility and Issue of Shares and Warrants
The Company has agreed a six-month funding facility of
US$500,000 with Shard Capital Management Limited. The Shard
Facility will rank pari passu with the existing Pegasus Facility.
The material terms of the facility comprise interest of 1% per
month paid monthly in arrears, sharing of the rights of Pegasus
under the existing fixed and floating charge over the Company's
assets shared held by Pegasus, and the issue of 31,446,541
three-year warrants at a strike price of 0.6 pence per share
("Shard Warrants"), which is a premium of 37.9 % to the midpoint
price of the Company's shares at the close of trading today. The
Shard Facility has a term of 6 months and a redemption fee of 8%.
The Shard Facility will also be repayable from future issues of
equity by the Company or other fundraising by the Company or its
subsidiaries subject to certain conditions and above a $2.5 million
threshold level similar to the repayment provisions of the Pegasus
Loan Facility. The Shard Facility contains usual default provisions
including an option to convert into equity if and only if a default
occurs.
As part of the Shard Facility agreement, $42,000 of interest
would be prepaid via the issue of 5,761,198 shares at a price of
0.393 per share (the "Issue Price") and using an exchange rate of
US$ 1.325 = GBP1 (the "Exchange Rate").
Extension of the Pegasus Loan Facility and Issue of Shares and
Warrants
As previously announced on 1 July 2020, the US$750,000 Loan
Facility, provided by Pegasus, was extended with repayment due on
or before 15 August 2020 with a further grace period to account for
any delays.
The Company has now agreed with Pegasus a further extension of
the repayment of the Pegasus Loan Facility, to coincide with the
maturity date of the Shard Facility, pursuant to which the terms of
the Pegasus facility would also be adjusted to reflect similar or
equivalent terms to the Shard Facility. Therefore the redemption
fee on the Pegasus Loan Facility will be changed to match that of
the Shard Facility, and an equivalent number of warrants on
equivalent terms pro rata will be issued to Pegasus in
consideration for the Pegasus Extension. The total number of
warrants to be issued to Pegasus, based on the same three year term
and strike price per share as the Shard Warrants will therefore be
47,169,811 warrants. The default provisions of the Pegasus Loan
Facility will also be conformed with the default provisions of the
Shard Facility, and Pegasus will share its security position with
Shard.
As part of the extension agreement, $152,120.30 of accrued
interest on the Pegasus Loan Facility, together with $45,000 as a
prepayment of interest will be converted into shares in the Company
at the Issue Price and using the Exchange Rate as set out
above.
Related Party Transactions
Jeremy Asher, Chairman and CEO, is the ultimate beneficial owner
of Pegasus, which has agreed the Pegasus Extension, and payment of
accrued and pre-payment loan interest via the issue of shares
("Loan Facility Interest Shares").
Jeremy Asher, as a director and substantial shareholder of the
Company, and Pegasus Petroleum Ltd, are considered to be "related
parties" as defined under the AIM Rules and accordingly, the
Pegasus Extension and associated issue of shares and warrants
constitutes a related party transaction for the purposes of Rule 13
of the AIM Rules.
The Directors independent of the Pegasus Extension, being Peter
Taylor and David M Thomas, consider, having consulted with SP Angel
Corporate Finance LLP, the Company's nominated adviser, that the
terms of the Pegasus Extension and issue of warrants and shares are
fair and reasonable insofar as the Company's shareholders are
concerned.
The following tables sets out the Directors' share and warrant
holdings and percentage interests in the issued share capital of
the Company following completion of the subscription and issue of
shares.
Holding prior Number of Immediately following Admission
to the announcement Shares acquired of the Subscription and
of Proposed Subscription pursuant Loan Facility Interest
and Issue of to the Loan Shares:
Shares pursuant Facility
to the Loan Facility Interest
Interest
Number of % of Number of Number of % of % of fully
Ordinary issued Ordinary Ordinary issued diluted
Shares share Shares Shares share share capital
capital capital
--------------- ----------- ----------------- ------------ --------- --------------
Jeremy Asher(*) 301,276,110 24.2 37,854,971 339,131,081 25.6 32.5
--------------- ----------- ----------------- ------------ --------- --------------
Peter Taylor 18,451,726 1.5 - 18,451,726 1.4 3.0
--------------- ----------- ----------------- ------------ --------- --------------
David M Thomas(#) - - - - - -
--------------- ----------- ----------------- ------------ --------- --------------
* 1,805,308 of these shares are held by Agile Energy Limited,
which is owned by the Asher Family Trust of which Jeremy Asher is a
lifetime beneficiary
(#) Independent Director
Note: fully diluted share capital is after exercise of all
warrants and options, and based on no further conversion of loans
to equity.
Director Number of Total number Shareholding % of issued
Warrants being of Warrants upon exercise share capital
issued held including of total number upon exercise
this issue* of Warrants of Warrants
held ++
Jeremy Asher 47,169,811 246,738,416 585,869,498 30.6
---------------- ---------------- ----------------- ---------------
Peter Taylor - 41,404,919 59,856,645 3.1
---------------- ---------------- ----------------- ---------------
David M Thomas - 17,215,461 17,215,461 0.9
---------------- ---------------- ----------------- ---------------
*Warrants are held at different prices.
Warrants issued to Pegasus Petroleum Ltd; a company beneficially
owned by Jeremy Asher
++Excludes share options
Share Capital following the Subscription and Issue of Shares
Application has been made for the Subscription Shares, and the
Loan Facility Interest Shares, to be admitted to trading on AIM. It
is expected that Admission of the Shares will become effective and
that dealings will commence at 8.00 a.m. on or around 4 September
2020.
Following admission of the Subscription Shares and Loan Facility
interest Shares , the Company's enlarged issued share capital will
comprise 1,325,296,032 Ordinary Shares of 0.001 pence each with
voting rights in the Company. This figure may be used by
shareholders in the Company as the denominator for the calculations
by which they will determine if they are required to notify their
interest in, or a change in the interest in, the share capital of
the Company under the FCA's Disclosure and Transparency Rules.
Jeremy Asher, Chairman and Chief Executive Officer,
commented:
"We are pleased to have agreed this loan facility with Shard,
which will provide us with working capital while we complete our
asset-level financing for our Cameroon development, and to have
made this small placing of shares. I believe that shareholders
already know that we are keen to avoid issuing more shares or
warrants than necessary at the current share price. The new loan
facility, and the extension of the existing one, will allow us to
avoid issuing more than a small number of shares, and most of those
new shares will also reduce our existing debt. Although the loans
require us to issue some warrants, these are at a significant
premium to the current share price, and my company Pegasus is also
pleased to be supporting the Company by converting existing
obligations into shares at the same terms as the subscription. Our
intention is that both loan facilities will be repaid when we
conclude our asset-level financing for Cameroon, which we are
working on at present. "
Note regarding forward-looking statements
This announcement contains certain forward-looking statements
relating to the Company's future prospects, developments and
business strategies. Forward-looking statements are identified by
their use of terms and phrases such as "targets" "estimates",
"envisages", "believes", "expects", "aims", "intends", "plans",
"will", "may", "anticipates", "would", "could" or similar
expressions or the negative of those, variations or comparable
expressions, including references to assumptions.
The forward-looking statements in this announcement are based on
current expectations and are subject to risks and uncertainties
which could cause actual results to differ materially from those
expressed or implied by those statements. These forward-looking
statements relate only to the position as at the date of this
announcement. Neither the Directors nor the Company undertake any
obligation to update forward looking statements, other than as
required by the AIM Rules for Companies or by the rules of any
other applicable securities regulatory authority, whether as a
result of the information, future events or otherwise. You are
advised to read this announcement and the information incorporated
by reference herein, in its entirety. The events described in the
forward-looking statements made in this announcement may not
occur.
Neither the content of the Company's website (or any other
website) nor any website accessible by hyperlinks on the Company's
website (or any other website) is incorporated in, or forms part
of, this announcement.
Any person receiving this announcement is advised to exercise
caution in relation to the Placing. If in any doubt about any of
the contents of this announcement, independent professional advice
should be obtained.
Market Abuse Regulation (MAR) Disclosure
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.
Contacts
Tower Resources plc +44 20 7157 9625
Jeremy Asher
Chairman and CEO
Andrew Matharu
VP - Corporate Affairs
SP Angel Corporate Finance
LLP
Nominated Adviser and
Joint Broker + 44 20 3470 0470
Stuart Gledhill
Caroline Rowe
Turner Pope Investments
(TPI) Limited
Joint Broker
Andy Thacker
Zoe Alexander + 44 20 3657 0050
Panmure Gordon (UK) Limited
Joint Broker
Nick Lovering
Hugh Rich + 44 20 7886 2500
NOTIFICATION AND PUBLIC DISCLOSURE OF TRANSACTIONS BY PERSONS
DISCHARGING MANAGERIAL RESPONSIBILITIES AND PERSONS CLOSELY
ASSOCIATED WITH THEM:
1. Details of the person discharging managerial responsibilities/person
closely associated
a) Name: Jeremy Asher
----------------------------------------- ----------------------------------------
2. Reason for the notification
-----------------------------------------------------------------------------------
a) Position/status: Chairman and Chief Executive
Officer
----------------------------------------- ----------------------------------------
b) Initial notification/Amendment: Initial notification
----------------------------------------- ----------------------------------------
3. Details of the issuer, emission allowance market participant,
auction platform, auctioneer or auction monitor
-----------------------------------------------------------------------------------
a) Name: Tower Resources PLC
----------------------------------------- ----------------------------------------
b) LEI: 2138002J9VH6PN7P2B09
----------------------------------------- ----------------------------------------
4. Details of the transaction(s): section to be repeated
for (i) each type of instrument; (ii) each type of transaction;
(iii) each date; and (iv) each place where transactions
have been conducted
-----------------------------------------------------------------------------------
a) Description of the financial instrument, Ordinary Shares of 0.001
type of instrument: pence each
Identification code: GB00BZ6D6J81
----------------------------------------- ----------------------------------------
b) Nature of the transaction: Pegasus Loan Facility
interest shares
----------------------------------------- ----------------------------------------
c) Price(s) and volume(s): Price(s) Volume(s)
0.393 pence 37,854,971
-----------
----------------------------------------- ----------------------------------------
d) Aggregated information: Single transaction as
Aggregated volume: in 4 c) above Price(s) Volume(s)
Price: 0.393 pence 37,854,971
----------------------------------------- ----------------------------------------
e) Date of the transaction: 28 August 2020
17:00 BST
----------------------------------------- ----------------------------------------
f) Place of the transaction: Outside a trading venue
----------------------------------------- ----------------------------------------
1. Details of the person discharging managerial responsibilities/person
closely associated
a) Name: Jeremy Asher
--------------------------------- -----------------------------------------
2. Reason for the notification
----------------------------------------------------------------------------
a) Position/status: Chairman and Chief
Executive Officer
--------------------------------- -----------------------------------------
b) Initial notification/Amendment: Initial notification
--------------------------------- -----------------------------------------
3. Details of the issuer, emission allowance market participant,
auction platform, auctioneer or auction monitor
----------------------------------------------------------------------------
a) Name: Tower Resources PLC
--------------------------------- -----------------------------------------
b) LEI: 2138002J9VH6PN7P2B09
--------------------------------- -----------------------------------------
4. Details of the transaction(s): section to be repeated
for (i) each type of instrument; (ii) each type of transaction;
(iii) each date; and (iv) each place where transactions
have been conducted
----------------------------------------------------------------------------
a) Description of the financial Ordinary Shares of
instrument, type of instrument: 0.001 pence each
Identification code: GB00BZ6D6J81
--------------------------------- -----------------------------------------
b) Nature of the transaction: Bridging Loan Extension
Facility warrants
--------------------------------- -----------------------------------------
c) Price(s) and volume(s): Price(s) Volume(s)
0.6 pence 47,169,811
-----------
--------------------------------- -----------------------------------------
d) Aggregated information: Single Transaction
Aggregated volume: as in 4 c) above Price(s) Volume(s)
Price: 0.6 pence 47,169,811
--------------------------------- -----------------------------------------
e) Date of the transaction: 28 August 2020
17:00 BST
--------------------------------- -----------------------------------------
f) Place of the transaction: Outside a trading
venue
--------------------------------- -----------------------------------------
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