Tanfield Group PLC Loan Subscription Update (5580D)
March 03 2022 - 6:56AM
UK Regulatory
TIDMTAN
RNS Number : 5580D
Tanfield Group PLC
03 March 2022
The information contained within this announcement is deemed by
the Company to constitute inside information under the Market Abuse
Regulation (EU) No. 596/2014. Upon the publication of this
announcement via a Regulatory Information Service ("RIS"), this
inside information is now considered to be in the public domain
Tanfield Group Plc
("Tanfield" or the "Company")
Loan Subscription Update
The Board of Tanfield (the "Board") is pleased to update the
market with respect to additional loans put in place to fund the
Company's ongoing legal proceedings in relation to its investment
in Snorkel International Holdings LLC ("Snorkel"), the aerial work
platform business, and other day to day costs.
Investment Background
-- Tanfield is a 49% shareholder in the equity of Snorkel
following the joint venture between the Company and Xtreme
Manufacturing LLC ("Xtreme") (the "Contemplated Transaction"), a
company owned by Don Ahern of Ahern Rentals Inc, relating to
Snorkel, in October 2013 .
-- The Snorkel investment is valued at GBP19.1m. The outcome of
the US and UK Proceedings referenced below could have an impact on
this valuation.
-- On 22 October 2019, the Company announced that it had
received a Summons and Complaint, filed in Nevada (the "US
Proceedings") by subsidiaries of Xtreme, relating to the
Contemplated Transaction.
-- On 24 October 2019, the Company announced it had become
necessary to issue and serve a claim in the English High Court
against Ward Hadaway (the "UK Proceedings"), the solicitor acting
for the Company at the time of the Contemplated Transaction, in
order to fully protect the Company's rights pending the outcome of
the US Proceedings.
-- On 26 February 2021, Ward Hadaway were granted permission to
join Foulston Siefkin LLP ("Foulston Siefkin"), Tanfield's US based
law firm who were retained in 2013 to draft the documents governed
by US law relating to the Contemplated Transaction, into the UK
Proceedings. As a result, the Company amended its claim to include
Foulston Siefkin as a second defendant.
Loan Subscription
Further to the update on 3 June 2021, in which the Company
announced that the second loan note instrument (the "Second Loan")
of up to GBP1m had subscriptions totalling GBP950,000, and the
update on 30 March 2020, in which the Company announced the first
loan note instrument (the "First Loan") of up to GBP700,000, with
GBP500,000 initially being subscribed to, the Board is pleased to
announce that an additional GBP125,000 of the First Loan has now
been subscribed to, taking the total First Loan subscription value
to GBP625,000. The additional First Loan (the "Additional Loan")
will be used for providing ongoing funding for the US and UK
Proceedings and other day to day costs.
The Additional Loan is unsecured and carries annual interest of
10% which is to accrue and is repayable on the earlier of (i) 28
February 2025 or (ii) receipt of sufficient funds relating to
either the US or UK Proceedings. Should repayment take place prior
to 28 February 2025, a 20% early redemption premium shall
apply.
A number of existing shareholders have subscribed to the
Additional Loan of GBP125,000, which constitutes a related party
transaction under Rule 13 of the AIM Rules as a result of OTK
Holding A/S and Zoar Invest Aps, which each hold approximately 14%
of the issued shares of the Company, subscribing GBP50,000 each to
the Additional Loan. The Directors of the Company, having consulted
with WH Ireland Limited, the Company's nominated adviser, consider
the terms of the transaction to be fair and reasonable in so far as
shareholders are concerned.
Following discussions with the existing shareholders, the Board
are of the opinion that further loan funding may be necessary to
ensure that the Company can continue to protect its investment in
Snorkel.
The Board believe that a positive outcome to either or both of
the US Proceedings and UK Proceedings is a reasonable expectation,
and the Company will continue to vigorously defend and advance its
position in both proceedings, whilst continuing to seek advice.
Further updates will be provided to Shareholders as and when
appropriate.
For further information:
Tanfield Group Plc 020 7220 1666
Daryn Robinson
WH Ireland Limited - Nominated Advisor / Broker
James Joyce / Ben Good 020 7220 1666
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