TIDMIOF
RNS Number : 2753L
Iofina PLC
30 September 2016
30 September 2016
Iofina plc
("Iofina", the "Group" or the "Company")
(LSE AIM: IOF)
Completion of US$20 million Convertible Secured Loan Notes
Restructure
and additional US$10 million Secured Facility
Iofina, specialists in the exploration and production of iodine
and iodine specialty chemical derivatives, is pleased to report the
completion of the restructuring of convertible secured loan notes
in the amounts of US$15 million to Stena Investment S.á.r.l.
("Stena") and US$5 million to Panacea Limited ("Panacea")
(together, the "Notes" and the "Noteholders"). The general terms of
this debt restructuring were first reported in June 2016, and the
documentation between the parties has now been completed.
Highlights:
Restructuring of $20m Convertible Notes
-- Reissued as Convertible Secured Notes redeemable 1 June 2019
-- Convertible in three equal tranches at 18p, 25p and 32p per share
-- Interest payable at 5% per annum or may be rolled-up and capitalised
New $10m Secured Facility with Stena
-- Repayable on 1 June 2019
-- Interest payable at 6% per annum
-- Funds to be used to support and develop the Group's iodine operations
Cumulative effect of these agreements is to remove uncertainty
surrounding the Group's balance sheet and funding position, and
provide operational flexibility to develop the Group's iodine
production and derivatives operations.
Commenting on today's announcement, Dr. Thomas Becker, President
& CEO of Iofina plc stated:
"The Board is delighted to announce the completion of the
documentation for the convertible debt restructuring and the
additional debt facility, the terms of which were first announced
in June. Iofina values the partnerships with Panacea and Stena and
the Group now has additional resources to execute growth
plans."
Details of the agreements:
On 29 September 2016 the Company executed two Convertible
Secured Loan Note Instruments on the same terms and conditions,
under which loan notes with a nominal value of US$1 each were
issued to Stena in an aggregate principal amount of US$15,000,000
and to Panacea in an aggregate principal amount of US$5,000,000.
These new loan Notes have refinanced and replaced in their entirety
the previously issued loan notes in the same principal amounts as
regards Stena and Panacea respectively. The principal terms and
conditions attaching to the Notes are as follows:
(a) unless previously converted into ordinary shares of GBP0.01
each in the capital of the Company ("Ordinary Shares") or redeemed,
the Notes are redeemable at par together with capitalised, accrued
and unpaid interest on 1 June 2019;
(b) the Company is entitled to redeem any of the Notes at any
time prior to 1 June 2019 without penalty;
(c) any or all of the Notes outstanding may be converted into
Ordinary Shares by the Noteholders at any time subject to prior
written notice to the Company of 28 days or such shorter period as
may be agreed by the Company;
(d) the conversion rates to be used for the conversion of the
Notes into Ordinary Shares are, as regards the total amount of the
Notes outstanding, one third at 18p per share, one third at 25p per
share, and one third at 32p per share;
(e) the Company may require that any or all of the Notes
outstanding be converted into Ordinary Shares following the
publicly quoted closing price per Ordinary Share being 50p or more
for at least five consecutive trading days;
(f) interest is payable quarterly in arrears at the rate of 5%
per annum. The Company may at its sole discretion elect to roll-up
quarterly interest payments without limit, in which case the
interest rolled-up will be capitalised and form part of the
principal balance of the Notes;
(g) the Noteholders may resolve to accept payment of any
capitalised or accrued interest by the issuance of Ordinary Shares,
using a conversion rate of 32p per share;
(h) unless the prior consent of the Company has been obtained,
the Noteholders are not entitled to sell or transfer the Notes
except to certain related parties; and
(i) no conversion shall be permitted in the event that, upon
such conversion, it would have the effect of establishing or
otherwise increasing a holding in Ordinary Shares of a Noteholder
(whether by itself or in conjunction with the holdings of any
"concert parties" (as defined in The City Code on Takeovers and
Mergers (the "Code))) which could potentially trigger a mandatory
offer having to be made for other Ordinary Shares under Rules 9 and
37 of the Code. A conversion may be so permitted if the Company and
the relevant Noteholder agree to it in writing but subject at all
times to the receipt of any prior written approval which may be
required from The Panel on Takeovers and Mergers.
The Notes are secured against the assets of the Group, by a
share pledge and a debenture granted by the Company, and by further
pledges, security agreement and guarantees granted by certain
subsidiaries of the Company.
On 29 September 2016 the Company entered into an agreement for a
Term Loan Facility of up to US$10,000,000 (the "Facility") with
Stena. The principal terms and conditions attaching to the Facility
are as follows:
(a) the Facility is to be utilised for capital expenditure and
working capital purposes in connection with (i) the Company's
iodine and iodine derivatives production, refinement, marketing and
sales activities; (ii) water depot project; and (iii) iodine and
natural gas operations, as carried out at the Company's sites in
the United States of America;
(b) the Company may draw down up to US$3,000,000 of the Facility
on request and in tranches of not less than US$250,000 or such
other amount as may be agreed;
(c) drawdowns of amounts of the Facility in excess of
US$3,000,000 are dependent upon completion of a detailed due
diligence exercise and satisfaction with the results by Stena
regarding the prevailing state of affairs relating to the Group and
its assets;
(d) interest is payable quarterly in arrears at the rate of 6%
per annum. The Company may elect to capitalise the interest, in
which case the interest will be rolled-up and treated as principal
outstanding and repaid on 1 June 2019;
(e) all amounts outstanding under the Facility are repayable in
full on 1 June 2019;
(f) the Company may repay any amounts outstanding under the
Facility at any time without penalty. The Company may reborrow
amounts previously repaid subject to the consent of Stena;
(g) for so long as amounts are outstanding under the Facility
the Company is not to make any payments to shareholders or other
debt providers, including principal amounts outstanding under the
Notes, without Stena's prior consent; and
(h) without the prior consent of Stena, the Group is not to take
on further borrowings, except for debt at an interest rate lower
than the Facility rate that is used to repay amounts outstanding
under the Facility.
The Facility is secured against the assets of the Group under
the same arrangements as set out above in relation to the
Notes.
Conversion premiums to current share price:
The premiums over the closing price per Ordinary Share of 13.75p
on 29 September 2016 represented by the conversion rates applicable
to the Notes are as follows:
-- Stena
o US$5 million at a conversion price of 18p, which represents a
premium of 31% to the closing price of 13.75p on 29 September
2016;
o US$5 million at a conversion price of 25p, which represents a
82% premium to the closing price of 13.75p on 29 September 2016;
and
o US$5 million plus any capitalised or accrued interest at a
conversion price of 32p, which represents a 133% premium to the
closing price of 13.75p on 29 September 2016
-- Panacea
o US$1.67 million at a conversion price of 18p, which represents
a premium of 31% to the closing price of 13.75p on 29 September
2016;
o US$1.67 million at a conversion price of 25p, which represents
a 82% premium to the closing price of 13.75p on 29September 2016;
and
o US$1.67 million plus any capitalised or accrued interest at a
conversion price of 32p, which represents a 133% premium to the
closing price of 13.75p on 29 September 2016
Conversion shares percentage of enlarged share capital:
Based on the par value of the Notes of US$20 million and the
current GBP/USD exchange rate (and excluding any interest which may
be converted) and assuming all Notes were converted, the Ordinary
Shares to be issued on the conversion of the total principal amount
of the Notes would represent approximately 65 million shares or
approximately 34% of the then enlarged issued share capital of the
Company.
For further information, please contact:
Dr. Tom Becker, CEO & President
Iofina plc
Tel: +44 (0)20 3006 3135
Christopher Raggett/Giles Rolls/Joanna Scott
finnCap Ltd
Tel: +44 (0)20 7220 0500
Media Contact:
Dominic Barretto/Harriet Jackson
Yellow Jersey PR Limited
Tel: +44 (0)7544 275 882
About Iofina:
Iofina specialises in the exploration and production of iodine,
iodine specialty chemical derivatives and produced water. Iofina's
business strategy is to identify, develop, build, own and operate
iodine extraction plants currently focused in North America based
on Iofina's WET(R) IOsorb(R) technology. Iofina has operations in
the United States, specifically in Montana, Kentucky and Oklahoma.
It has complete vertical integration from the production of iodine
in the field to the manufacture of the chemical end-products
derived from iodine to the consumer and the recycling of iodine
using iodinated side-streams from waste chemical processes. Iofina
utilises its portfolio of patented and patent pending technology,
proprietary methods and trademarks throughout all business
lines.
www.iofina.com
This information is provided by RNS
The company news service from the London Stock Exchange
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