Solo Oil Plc US$5 million Convertible Loan Facility (3809W)
November 14 2017 - 2:01AM
UK Regulatory
TIDMSOLO
RNS Number : 3809W
Solo Oil Plc
14 November 2017
FOR IMMEDIATE RELEASE
14 November 2017
SOLO OIL PLC
("Solo" or the "Company")
US$5 million Convertible Loan Facility
Solo Oil plc (SOLO: AIM) is pleased to announce that the Company
has today entered into a Convertible Loan Agreement ("Agreement")
with institutional investors arranged by RiverFort Global Capital
Limited ("RiverFort Investors") for a total maximum commitment of
US$5 million. The Company has also drawn a first tranche of US$1.5
million ("First Tranche"), with subsequent drawings against the
facility to be at the Company's sole election.
The First Tranche will be used to fund the Company's share of
forecasted activities within the Company's investment portfolio,
specifically:
-- the final reconciled expenses for the Ntorya-2 well and flow
testing in Tanzania, in which Solo holds a 25% working
interest,
-- screening engineering studies for the planned Ntorya early
production scheme and full field development,
-- a Competent Persons Report for the estimated gross 1.34
trillion cubic feet ("tcf") gas in place Ntorya accumulation,
-- additional studies at the Kiliwani North producing gas field,
where Solo holds a 7.55% interest,
-- upcoming long term well testing at the Horse Hill-1 oil
discovery in the UK, in which Solo has a 10% participating interest
in Horse Hill Development Limited,
-- pre-drill technical work within the Helium One Limited
investment in which Solo holds a 10% interest by means of shares,
and; general investment working capital needs over the next 6
months.
Neil Ritson, Executive Chairman, commented:
"Solo is approaching a period of considerable activity which
will require expenditure across all of the mature investments
within our diverse portfolio. We anticipate that this expenditure
will enhance the core underlying value of our portfolio through a
range of exciting operational milestones."
"Having undertaken a thorough review of the funding options
available to Solo we have determined that this convertible loan
facility is by far the most effective and least dilutive option for
the Company and its shareholders. The facility conversion price is
set at a 45% premium to the closing share price and the First
Tranche provides us with the ability to cover our share of
anticipated costs associated with the multiple activities that we
forecast in the near future. As previously indicated, should we
seek to raise significant operational funds, for example to drill
additional wells in Ruvuma, we will open that funding round to
existing shareholders to participate.
Terms of the Loan
Each tranche ("Advance") will have a 12 month term with and
initial 3 month repayment holiday and will bear an 8 percent per
annum interest rate. During the term of the Agreement the Company
may elect to make repayments of principal and accrued interest in
shares or in cash. Shares used to pay principal and interest will
be issued at the lower of (a) 145% of the closing share price of
the Company on the date of the drawdown ("Fixed Conversion Price"),
or (b) 95% of the lowest daily VWAP over the 10 trading days
immediately prior to a notice of conversion. Should the Company
elect to make a repayment of principal and interest in cash, a
redemption fee of 5% is also payable.
The Company can elect to extend the term of each Advance by 6
months by giving 30 days notice before the end of the 12 month term
and paying an extension fee of 5%.
During the term of the Agreement the RiverFort Investors
covenant that they and their affiliates and insiders will hold no
net short position in the Company. The Company will issue warrants
to the RiverFort Investors over 15% of each tranche at the Fixed
Conversion Price of each tranche with a three year term.
The information contained in this announcement is deemed by the
Company to constitute inside information for the purposes of the EU
Market Abuse Regulation No. 596/2014.
For further information:
Solo Oil plc
Neil Ritson / Dan Maling +44 (0) 20 7440 0642
Beaumont Cornish Limited
Nominated Adviser and
Joint Broker
Roland Cornish / Rosalind
Abrahams +44 (0) 20 7628 3396
Shore Capital
Joint Broker
Jerry Keen
Beaufort Securities
Joint Broker
Jon Belliss
Buchanan (PR) +44 (0) 20 7408 4090
Ben Romney / Chris +44 (0) 20 7382 8300
Judd / Henry Wilson +44 (0) 20 7466 5000
Notes to Editors:
Solo Oil plc (Solo), is a natural resources investment company
with a diverse portfolio of onshore assets, principally in Europe
and Africa. The company seeks to deliver returns through early
stage investment in promising projects and uses management's own
sector expertise to assist in strategic asset development. Solo's
portfolio currently includes extensive interests in the prolific
Ruvuma Basin in Tanzania, the Horse Hill oil discovery in the Weald
Basin, Helium One Limited, the Tanzanian helium exploration
company, and Kiliwani North, a natural gas producing project in
Tanzania.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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