Sefton Resources Inc Lifting of bank security (0720I)
March 20 2015 - 9:10AM
UK Regulatory
TIDMSER
RNS Number : 0720I
Sefton Resources Inc
20 March 2015
20 March 2015
Sefton Resources, Inc.
("Sefton" or the "Company")
Lifting of Bank Security
Sefton Resources Secures Lifting of $4m Contingent Liability
As detailed in the announcement of 16 January 2015 (the
"Announcement") and the accompanying notice of an extraordinary
general meeting, TEG USA Inc. ("TEGU"), which was a wholly owned
subsidiary of Sefton until its sale to Hawker Energy LLC ("Hawker")
on 1 February 2015, has an outstanding borrowing facility (the
"Facility") with the Bank of the West (the "Bank"). As outlined in
the Announcement, Sefton and TEG MidContinent Inc. (Sefton's wholly
owned Kansas oil and gas exploration and production subsidiary)
("TEGM") have continued to be co-borrowers under the Facility,
meaning that the contingent liability for the full balance of the
Facility until it is repaid in full. The Facility was secured by
way of a charge on the assets of TEGU, TEGM and Sefton.
Sefton, Hawker and the Bank and have completed and signed an
amendment to the terms of the Facility (the "Amendment"), which in
a significant development for Sefton, has removed Sefton and TEGM
as co-borrowers under the Facility and that TEGU, now a subsidiary
of Hawker, is the sole borrower. Sefton and TEGM no longer provide
any security or have any contingent liability for the Facility.
The material terms of the Amendment are as follows:
-- Sefton has made a payment to the Bank of $400,000.
-- Sefton has returned to Hawker the 5,000,000 warrants and
1,500,000 of the 3,000,000 common shares of Hawker received by
Sefton as part payment for the acquisition of TEGU (as described in
the Announcement).
-- Sefton will novate to the Bank the promissory note from
Hawker to Sefton it is due to receive under the indemnity for the
payment to the Bank of $400,000 referred to above. As outlined in
the Announcement, Hawker agreed to indemnify Sefton and TEGM for
any payments made under the Facility to the Bank subsequent to the
sale of TEGU, the indemnity to be satisfied through the issue of a
loan note of equivalent value to Sefton. These loan notes are to
carry a 6% coupon and by repayable on the earlier of full repayment
of the Facility to the Bank and three years from issue.
-- The assets in Kansas owned by TEGM and TEG Transmission LLC
(Sefton's wholly owned Kansas gas pipeline subsidiary) are now no
longer subject to any security agreement or any risk of
foreclosure.
Dan Levi, Interim Executive Chairman stated; "Achieving the goal
of removing Sefton and TEGM from the Facility has been a difficult
process. It has taken a significant effort by all concerned to
reach an accord with the Bank and Hawker on the lifting of this$4m
contingent liability. Sefton Resources and both its subsidiaries
can now move forward. I would personally like to thank the whole
Sefton team for their efforts."
Director Tom Milne commented; "It has been our ambition to turn
Sefton into a profitable enterprise for the benefit of all
shareholders. The signing of the Amendment opens Sefton to many
opportunities and the ongoing discussions on the sale of the Kansas
assets that we announced on 24 February 2015 can now be
progressed."
Visit www.seftonresources.com or contact:
Daniel Levi, Executive Chairman Tel: 07912 864
195
--------------------------------------------- -------------------
Nick Harriss, Nick Athanas, Allenby Capital Tel: 020 3328 5656
(Nomad)
--------------------------------------------- -------------------
James Sheehan, Nick Bealer, Cornhill Capital Tel: 020 7710 9610
(Broker)
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This information is provided by RNS
The company news service from the London Stock Exchange
END
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