Atlantic Coal PLC Up to US$5 million loan facility backed by a SEDA (0996K)
July 25 2013 - 1:01AM
UK Regulatory
TIDMATC
RNS Number : 0996K
Atlantic Coal PLC
25 July 2013
Atlantic Coal plc / Index: AIM / Epic: ATC / Sector: Mining
Atlantic Coal plc ("Atlantic Coal" or the "Company")
Up to US$5 million loan facility backed by a SEDA
Atlantic Coal plc, the AIM listed anthracite coal mining company
operating in Pennsylvania, USA, is pleased to announce that it has
entered into an agreement with YA Global Master SPV Ltd, an
investment fund managed by Yorkville Advisors Global LP
("Yorkville") under which YA Global Master SPV Ltd will provide an
up to US$5 million loan facility (the "Loan Facility") backed by a
standby equity distribution agreement ("SEDA") and subject to the
issue of warrants.
The US$5 million raised will be used by Atlantic Coal to develop
the 410 acre Pott & Bannon site, which is located 25 miles from
the Company's producing Stockton Anthracite Colliery and for
working capital purposes. Atlantic Coal plans to purchase machinery
and conduct hydrology and engineering studies to prove up the
reserves at the Pott & Bannon site which it believes currently
stand at approximately 13.6 million tons run-of-mine ("ROM") coal,
equating to approximately 4.1 million tons of washed, saleable
anthracite. These estimates have been previously announced and are
based on information provided to the Company in January 2012 and is
outlined in a report commissioned by the Reading Anthracite Company
(the previous owner of the Pott & Bannon site) in January 1999
and prepared by John T. Boyd & Company. This is in line with
the Company's strategy to increase anthracite production in the
Pennsylvanian Anthracite Field.
Atlantic Coal's Managing Director Steve Best said: "This loan
facility with Yorkville provides Atlantic Coal with ready access to
funds at a time of significant growth and development. We are
focussed on driving the recently acquired Pott & Bannon site
towards production. We believe the Pott & Bannon site contains
approximately 4.1 million tons of washed and saleable anthracite
and we are looking to increase our revenues from our coal mining
assets in Pennsylvania. We look forward to announcing the results
of our forthcoming studies.
"Anthracite prices have been depressed over the last year and
suppliers have sought to reduce inventory. Atlantic Coal has
weathered this period successfully and the loan facility will
provide us with additional financial security should prices remain
depressed."
Details of Loan Facility
An initial tranche of US$750,000 will be available for immediate
drawdown followed by a second tranche of USD$750,000 subject to
conditions. Further tranches may be available subject to further
conditions being met. The first two tranches are subject to an
arrangement fee of 7% and each tranche is repayable over 12 months
with interest at 10 per cent. per annum. Any subsequent tranches
are subject to a 9% arrangement fee and 10% interest. Alternatively
Atlantic Coal may elect to draw on the SEDA facility to make
repayment of funds drawn down under the Loan Facility.
Details of SEDA Facility
Subject to its terms, the up to US$4 million SEDA facility can
be drawn upon at the discretion of the Company. Under the terms of
the agreement, Atlantic Coal may draw down on funds over a period
of up to three years in exchange for the issue of new ordinary
shares of 0.07p each in the Company (the "New Ordinary Shares").
The New Ordinary Shares will be issued at a 5% discount to the
prevailing market price during the 10 dealing day pricing period of
a draw down. The Company may also set a minimum price for each draw
down. The maximum advance that may be requested is 200% of the
average daily trading volume of Ordinary Shares multiplied by the
volume weighted average price of such shares for each of the 10
dealing days prior to the date of the draw down request.
The facility may only be drawn down upon once every 10 days. A
fee of GBP80,000 is payable by the Company, half of which is
payable six months after signing the SEDA and the balance 12 months
after signing.
Warrants
Atlantic Coal will issue warrants to Yorkville equivalent to 25%
of each tranche drawn converted into sterling at the exchange rate
on the transfer date divided by the market price on that day and
with a subscription price of 125% of the closing price on the
transfer date.
**ENDS**
For further information on the Company, visit:
www.atlanticcoal.com or contact:
Steve Best Atlantic Coal plc Tel: 020 3328 5670
Nick Naylor Allenby Capital Limited Tel: 020 3328 5656
Mark Connelly Allenby Capital Limited Tel: 020 3328 5656
Elisabeth Cowell St Brides Media & Finance Tel: 020 7236 1177
Ltd
This information is provided by RNS
The company news service from the London Stock Exchange
END
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