TIDMTOM
RNS Number : 6931U
TomCo Energy PLC
30 March 2023
30 March 2023
TOMCO ENERGY PLC
("TomCo" or the "Company")
Convertible Loan Note Facility, Issue of Initial Associated
Warrants
and Further Extension of TSHII Option
TomCo Energy plc (AIM: TOM), the US operating oil development
group focused on using innovative technology to unlock
unconventional hydrocarbon resources, announces that the Company
has obtained an unsecured committed facility of up to GBP1,000,000
via a convertible loan note instrument and associated subscription
and put option agreement (together, the "Convertible Loan") entered
into with certain subscribers introduced by Novum Securities
Limited ("NSL"), the Company's broker, as further detailed
below.
The Convertible Loan is intended to further bridge the Company's
general working capital requirements, to the extent required, as
the Board seeks to finalise due diligence and documentation in
respect of its preferred arrangements with a potential financing
party for a funding package to enable the Company to execute on its
previously stated development plans for its wholly owned
subsidiary, Greenfield Energy LLC ("Greenfield") and the Tar Sands
Holdings II LLC ("TSHII") site. These plans include, inter alia,
securing the remaining 90% of the Membership Interests in TSHII,
with its 760 acres of land and a large mining permit in Utah, USA,
constructing two oil sands processing plants and associated
infrastructure on the TSHII site, and drilling a series of in-situ
oil recovery wells.
As previously announced, Greenfield currently owns a 10%
Membership Interest in TSHII and holds an exclusive option (the
"Option"), exercisable at its sole discretion, to acquire the
remaining 90% of the Membership Interests for additional cash
consideration of US$16.25 million which was scheduled to expire on
31 March 2023 (the "Agreement"). To allow additional time for the
abovementioned funding package to be secured, the Agreement has now
been varied in order to further extend the exercise period of the
Option. Accordingly, Greenfield may now exercise the Option, at its
sole discretion, by delivering a notice of exercise on or before 30
April 2023 and making payment of the US$16.25 million cash
consideration by no later than 5 May 2023. However, there can be no
certainty that appropriate funding arrangements will ultimately be
successfully secured or as to the terms of any such funding or
consequently that the Option will be exercised.
The Convertible Loan
The GBP1,000,000 Convertible Loan facility is available for
drawdown by the Company in four equal tranches of GBP250,000. The
Company has, at its sole election, an option to draw down one or
more of the GBP250,000 tranches on or before 31 March 2024.
Interest equating to a fixed amount of five per cent. of the
principal amount drawn down shall accrue until repayment,
conversion or redemption of the relevant notes.
Amounts drawn down under the facility and the associated accrued
interest are convertible at any time at the election of a
noteholder via service of a conversion notice. Alternatively, they
may be repaid in cash before 31 March 2024 at the election of the
Company by way of the Company giving not less than five business
days' notice in writing during which period the noteholder(s)
concerned remain entitled to serve a conversion notice prior to
such repayment.
If any amounts drawn down under the Convertible Loan are not
repaid or converted prior to the scheduled redemption date of 31
March 2024, the noteholder(s) concerned shall be deemed to have
served a conversion notice to convert the outstanding balance and
the associated accrued interest into new ordinary shares of no-par
value in the capital of the Company ("Ordinary Shares").
The conversion price per new Ordinary Share under the facility
shall be determined as the lower of: (i) 0.60 pence; and (ii) the
volume-weighted average price of an Ordinary Share during any five
of the fifteen business days prior to service or deemed service of
a conversion notice, as selected by the noteholder(s) concerned and
sourced from Bloomberg L.P., discounted by 15 %.
Warrants
The Convertible Loan subscribers have been issued with, in
aggregate, 41,666,667 warrants by the Company, with each warrant
affording the holder the right to subscribe for one new Ordinary
Share at an exercise price of 0.60 pence per share, for a period of
three years ("Warrants").
If any GBP250,000 tranche of the Convertible Loan is drawn down,
the Convertible Loan subscribers will be issued with, in aggregate,
a further 41,666,667 Warrants by the Company for each of the first
three GBP250,000 tranches drawn down, exercisable for a period of
three years from the date of any such drawdown.
Accordingly, if the full GBP1,000,000 of the Convertible Loan
was to be drawn down a total of 166,666,667 Warrants would be
issued. If these were to subsequently be exercised in full, it
would result in the issue of 166,666,667 new Ordinary Shares
raising a further GBP1,000,000 towards the development of the
Company's business.
NSL will also be issued on drawdown of the initial tranche of
the Convertible Loan with 10,000,000 warrants, with each warrant
affording the right to subscribe for one new Ordinary Share at an
exercise price of 0.60 pence per share, for a period of two years
from the date of such drawdown (the "Broker Warrants"). If the
Broker Warrants were to subsequently be exercised in full, it would
result in the issue of 10,000,000 new Ordinary Shares raising a
further GBP60,000 towards the development of the Company's
business.
Commenting today, John Potter, CEO of TomCo, said : "This
Convertible Loan facility provides the Company with the flexibility
to have financing available to drawdown, to the extent required,
whilst we seek to finalise negotiations with a potential financing
partner for a funding package that, if secured, would enable the
Company to execute on its development plans for Greenfield and the
TSHII site. Whilst there can be no certainty that the preferred
funding package being negotiated will ultimately be secured, these
remain very exciting times for TomCo and I look forward to making
further announcements in due course."
Enquiries :
TomCo Energy plc
Malcolm Groat (Chairman) / John Potter (CEO) +44 (0)20 3823 3635
Strand Hanson Limited (Nominated Adviser)
James Harris / Matthew Chandler +44 (0)20 7409 3494
Novum Securities Limited (Broker)
Jon Belliss / Colin Rowbury +44 (0)20 7399 9402
IFC Advisory Limited (Financial PR)
Tim Metcalfe / Florence Chandler +44 (0)20 3934 6630
For further information, please visit www.tomcoenergy.com .
The information contained within this announcement is deemed by
the Company to constitute inside information as stipulated under
the Market Abuse Regulation (EU) No. 596/2014 as it forms part of
United Kingdom domestic law by virtue of the European Union
(Withdrawal) Act 2018, as amended by virtue of the Market Abuse
(Amendment) (EU Exit) Regulations 2019. .
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