TIDMOEX
RNS Number : 7739U
Oilex Ltd
31 July 2020
ASX-RNS Announcement
31 July 2020
ASX: OEX
AIM: OEX
Loan Restructure and Equity Issue
The Board of Oilex Limited (the Company) is pleased to announce
that it has taken further steps to strengthen its balance sheet as
the Company continues to navigate the impact of Covid-19 on its
business and global equity markets. In particular, the Company has
entered into an amendment agreement to vary the repayment
obligations for its Series C (GBPGBP125,000) loan. Furthermore, the
Company has secured additional equity investment of GBP0.25 million
to increase its working capital flexibility and reduce its
financial debt obligations.
Amendment to Series C Loan Funding Agreement (GBP
GBP125,000)
Pursuant to the amendment agreement, the loan repayment date has
been extended from 1 August 2020 to 31 October 2020. All other
terms remain the same and are extended to 31 October 2020, except
for the issue of new options with an expiry date of 29 January
2021. A summary of key terms after the amendment are outlined
below:
Term: 31 October 2020
Interest Rate: 5%
Repayments 100% payable at maturity
Options Issued: 113,636,364 options over ordinary shares
Option Exercise Price: GBP0.0011 per option
Option Expiry Date: On 29 January 2021
Security: Unsecured
Key Undertakings: Not to dispose of assets having an aggregate
value more than A$1 million
Not to incur any financial indebtedness more than A$50,000
Not to incur any aggregate payment or outgoing exceeding A$1
million (except for wages)
Customary additional provisions regarding events of default,
undertakings, covenants and representations and warranties remain
unchanged.
The options, which if exercised in their entirety, will result
in a cash inflow to the Company of GBP125,000 (A$224,901). The
proceeds from such conversion of options will be applied to the
outstanding Series C Loan balance, which is fully drawn down.
The issue of the new options is subject to shareholder approval
under ASX Listing Rule 7.1 on or before 30 November 2020. Failure
to secure shareholder approval will require immediate repayment of
the loan principal and accrued interest.
Related Party Transaction under AIM
Republic Investment Management Pte Ltd (Republic) makes up all
of the Series C Loan balance of GBP125,000 . Republic has a
shareholding in the Company of 11.88% and is therefore categorised
as a Substantial Shareholder of the Company pursuant to the AIM
Rules for Companies (AIM Rules). Accordingly, the entering into the
amendment agreement with Republic is classified as a related party
transaction pursuant to the AIM Rules.
The Directors of the Company, having consulted with Strand
Hanson Limited, the Company's Nominated Adviser, consider that the
terms of the amendment agreement with Republic are fair and
reasonable insofar as the Company's shareholders are concerned.
Equity Capital Raising
The Company has arranged an equity capital raising, through
Novum Securities Limited and to existing institutional
shareholders, to secure further funding of GBP0.25 million (A$0.5
million) through the subscription of 312,500,000 new shares at GBP
0.08 pence (0.144 AUD cents) per share (Subscription).
Funds raised from the Subscription are intended to be applied
towards increasing the Company's working capital base and debt
reduction The additional funding will support the Company's
initiative to implement the settlement with GSPC, which has been
delayed by the impact from Covid-19. Completion of the Subscription
is anticipated on or about 14 August 2020 and is conditional, inter
alia, upon admission of the shares the subject of the Subscription
to trading on AIM.
Pursuant to advisory agreements with Novum, the Company will
issue 15,000,000 unlisted options exercisable at 0.08 pence on or
before two years following the completion with the capital
raising.
The shares, the subject of the Subscription, will rank pari
passu in all respects with the existing shares. Application will be
made in due course to the London Stock Exchange for the shares
(Subscription Shares) to be admitted to trading on AIM with a
further announcement at that time. The issue of the Subscription
Shares is under Listing Rule 7.1 with the applicable Appendix 3B to
be submitted shortly.
Following admission of the Subscription shares, the Company's
share capital and total voting rights will comprise 4,119,629,999
shares. The Company does not hold any shares in treasury.
Consequently, 4,119,629,999 is the figure which may be used by
shareholders as the denominator for the calculation by which they
will determine if they are required to notify their interest in, or
a change to their interest in, the Company under the FCA's
Disclosure and Transparency Rules.
Managing Director of Oilex, Joe Salomon, said;
"The Company continues to see advances in its flagship Cambay
gas project in India, the sale of Bhandut together with the spin
out of the Cooper Basin albeit the impact of COVID has increased
response times in both India and Australia.
Reflecting the extended time frames, the Company has taken every
step to reduce its costs including a very significant reduction in
staff costs and overheads, both in Australia and India. These
efforts ensure that the Company's funding requirements are
minimised while it implements the settlement with GSPC, sale of
Bhandut and the Armour transaction.
We remain confident of successful outcome and we thank our
shareholders for their ongoing support and patience."
For and on behalf of Oilex Ltd
Joe Salomon
Managing Director
For further information, please contact:
Investor Enquires AIM Broker AIM Nominated Media Enquires
Oilex Ltd Novum Securities Adviser (UK)
Joe Salomon B roker Strand Hanson Vigo Communications
Managing Director Colin Rowbury Limited Public Relations
Email: oilex@oilex.com.au Email: Nominated Adviser Patrick d'Ancona/Chris
Tel: +61 8 9485 crowbury@novumsecurities.co Rory Murphy/Ritchie McMahon
3200 m Balmer Email:
Australia Tel: +44 20 7399 Email: patrick.dancona@vigocomms.c
9427 oilex@strandhanson.co.uk om
UK Tel: +44 20 7409 chris.mcmahon@vigocomms.com
3494 Tel:+ 44 20 7390
UK 0230 UK
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END
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