GREENWOOD VILLAGE, Colo.,
Oct. 17, 2016 /PRNewswire/
-- Tengasco, Inc. (NYSE MKT: TGC) announced today that it
has filed a registration statement with the Securities and Exchange
Commission with respect to a proposed rights offering to existing
shareholders as of the record date, which has not been determined.
The rights offering will provide that the holders of each share of
the Company's approximately 6.1 million outstanding shares of
common stock may purchase two new shares for $0.66 each. The offer includes an
oversubscription privilege whereby participating shareholders may
purchase shares that were offered but not purchased by other
shareholders, if any are available, for $0.66 per share. Although the Company does not
currently expect to do so, the Company may change the subscription
price in the offering as it may deem necessary when the Securities
and Exchange Commission deems the current filing to be effective
and the Company finalizes all details of the offering.
If the rights offering is fully subscribed, the Company would
receive gross proceeds of approximately $8
million.
The net proceeds of the rights offering will be used initially
to pay bank indebtedness in the amount of approximately
$2.4 million, with the balance
of the net proceeds to be used for working capital and general
corporate purposes, including projects currently identified by the
Company for acquisition, joint development, or joint exploration in
Kansas and Texas as well as exploration of the Company's
leased acreage in Saline County,
Kansas. The rights offering gives the Company's current
shareholders the opportunity to participate in this capital raising
effort and to purchase additional shares of our common stock.
The final subscription price, record date, offering period,
issuance date and other details of the proposed offering have not
yet been determined, although the Company anticipates that the
offering will commence within 45 days. When the Securities
and Exchange Commission declares the Company's registration
statement effective, the prospectus and related documents will be
mailed to shareholders of record and will also be made available,
as applicable, for distribution to beneficial owners of the
Company's common stock. None of the Company, its board of
directors or any committee of its board of directors is making any
recommendation to shareholders as to whether to exercise their
subscription rights. The Company anticipates that Dolphin Offshore
Partners, L.P., the Company's largest shareholder, will fully
exercise its basic subscription rights and oversubscription
privileges subject to the limitations imposed by the terms of the
offering. The Company also anticipates that all of the Company's
directors and the Chief Executive Officer of the Company will fully
exercise their basic subscription rights.
This press release is for informational purposes only and is not
an offer to purchase or a solicitation of an offer to sell shares
of common stock. Shareholders should carefully read the
prospectus and related materials when they are available because
they contain important information. Shareholders may obtain a
free copy (when available) of the prospectus and other documents
relating to the offer at the Securities and Exchange Commission's
website as www.sec.gov.
Forward-looking statements made in this release are made
pursuant to the safe harbor provisions of the Private Securities
Litigation Reform Act of 1995. Investors are cautioned that all
forward-looking statements involve risk and uncertainties which may
cause actual results to differ from anticipated results, including
risks associated with the anticipated commencement and completion
of the rights offering, the intended use of proceeds from the
offering, the timing and development of the Company's reserves and
projects as well as risks of downturns in economic conditions
generally, and other risks detailed from time to time in the
Company's filings with the Securities and Exchange Commission.
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SOURCE Tengasco, Inc.