TIDMCOPL
RNS Number : 0066Q
Canadian Overseas Petroleum Ltd
15 June 2020
Canadian Overseas Petroleum Limited Secures Loan
Loan Agreement for GBP600,000 and Termination of Equity Sharing
Agreement
Calgary, Canada, June 15, 2020 - Canadian Overseas Petroleum
Limited ("COPL" or the "Company") (XOP: CSE) & (COPL: LSE), an
international oil and gas exploration and development company
focused on sub-Sahara Africa, today announces that it has entered
into a loan agreement with YA II PN, Ltd ("YA") and Riverfort
Global Opportunities PCC ("RGO" and, together with YA, the
"Lenders") for an unsecured facility of GBP600,000 (the "Loan
Agreement"). Pursuant to the terms of the Loan Agreement the
Company can draw down GBP100,000 per month for a period of six
months following the date of the Loan Agreement. Each tranche
drawdown is repayable in cash six months from the respective
drawdown date. The term of the loan is one year. In addition, the
each of the Lenders has committed to participate in a future equity
placing for GBP100,000 each provided that any such equity funding
is completed on or before August 28, 2020 ("Future Equity
Funding"). The Equity Sharing Agreement announced by the Company on
April 30 with YA and RGO has been terminated by the parties by
mutual consent pursuant to the terms of the Loan Agreement. The
funds received by the Company pursuant to the Loan Agreement and,
if applicable, the Future Equity Funding will cover general working
capital and enable the Company to continue focusing on its Nigerian
OPL 226 project as disclosed on June 4, 2020.
The benefits of this transaction include:
-- The securing of this capital despite the uncertain market
environment underpins COPL's confidence that it can successfully
execute its business plan.
-- The Loan Agreement will allow the Company to attract
additional capital going forward due to the knowledge it has
sufficient funding to navigate these unprecedented market
conditions.
-- The funds from the Loan Agreement allow the Company to
continue to focus its interest in its prime Nigerian asset OPL 226,
which is an outstanding conventional light oil
appraisal/development project.
-- As part of the transaction, CEO Arthur Millholland, has
agreed to defer the repayment of his previously disclosed loan to
the Company until December 31, 2020.
Arthur Millholland, President and CEO, commented : "To have
secured this funding, especially during these very challenging
times, reflects the Company's prospects and the high quality of its
principle asset."
Summary of Loan Terms
-- GBP600,000 unsecured Loan facility, in six monthly drawdowns
of GBP100,000 each. The first drawdown is available to COPL on
signing the Loan Agreement. Subsequent monthly drawdowns are
available subject to the fulfilment of certain conditions,
including completion of GBP500,000 in Future Equity Funding. Each
drawdown is repayable to the Lenders six months following such
drawdown.
-- Loan Agreement costs include GBP36,000 in common shares of
the Company to be issued to the Lenders at the price of the Future
Equity Funding and a 10% Fixed Coupon is payable on the Loan
Agreement amount due at repayment of the first drawdown. COPL has
the option to pay the coupon in common shares at the Future Equity
Funding price at a fixed rate of 12.5% if paid in common
shares.
-- The Lenders will be issued common shares purchase warrants,
each warrant exercisable into one common share at a strike price to
be set at 30% premium to the Future Equity Funding price. Warrants
exercised may be set-off against amounts outstanding to the Lenders
under the Loan Agreement.
-- COPL must complete GBP500,000 in Future Equity Funding
(GBP200,000 of which will be placed to the Lenders) no later than
28 August 2020 as condition of the Loan; it is otherwise fully
repayable on that date.
-- In the event of default, common shares of COPL may be issued
to satisfy default amounts, and such conversion will be priced at
80% of COPL's trailing 10-day VWAP, five days following the missed
payment/default date.
About the Company:
The Company is actively pursuing opportunities in Nigeria and
sub-Saharan Africa in partnership with Shoreline Energy
International Limited ("Shoreline") as part of its strategy to
generate stable cash flow from secure offshore and onshore assets.
The Company and Shoreline, through their jointly held affiliated
company Shoreline Canadian Overseas Petroleum Development
Corporation ("ShoreCan"), currently hold 80% of the share capital
and have taken over the management of Essar Exploration and
Production Limited (Nigeria) ("Nigerian Affiliate" or the
"Affiliate"). On June 4, 2020 the Company announced that the
shareholders of the Nigerian Affiliate had reached an agreement in
principle to resolve their disputes. Completion of the agreement is
ongoing and when completed ShoreCan's shareholding in the Affiliate
will change in accordance to the terms outlined in the Press
Release. The Affiliate holds an attractive oil appraisal and
development project in shallow to mid-water offshore Nigeria on its
100% holding in OPL 226. In other ventures, ShoreCan has been
indicatively awarded an exploration license onshore Mozambique in
the 5th Licensing Round adjacent to the producing Pande-Temane Gas
and light oil field complex.
For further information, please contact:
Mr. Arthur Millholland, President & CEO
Canadian Overseas Petroleum Limited
Tel: + 1 (403) 262 5441
Cathy Hume
CHF Investor Relations
Tel: +1 (416) 868 1079 ext. 231
Email: cathy@chfir.com
Charles Goodwin
Yellow Jersey PR Limited
Tel: +44 (0) 20 3004 9512
Email: copl@yellowjerseypr.com
Damon Heath
Shard Capital Partners LLP
Tel: +44 (0) 20 7186 9952
The Common Shares are listed under the symbol "XOP" on the CSE
and under the symbol "COPL" on the London Stock Exchange.
This news release contains forward-looking statements. The use
of any of the words "initial, "scheduled", "can", "will", "prior
to", "estimate", "anticipate", "believe", "should", "forecast",
"future", "continue", "may", "expect", and similar expressions are
intended to identify forward-looking statements. The
forward-looking statements contained herein are based on certain
key expectations and assumptions made by the Company, including,
but not limited to, the ability to raise the necessary funding for
continued operations, delays or changes in plans with respect to
exploration or development projects or capital expenditures.
Although the Company believes that the expectations and assumptions
on which the forward-looking statements are based are reasonable,
undue reliance should not be placed on the forward-looking
statements since the Company can give no assurance that they will
prove to be correct since forward-looking statements address future
events and conditions, by their very nature they involve inherent
risks and uncertainties most of which are beyond the control of
Canadian Overseas Petroleum Ltd. For example, the uncertainty of
reserve estimates, the uncertainty of estimates and projections
relating to production, cost overruns, health and safety issues,
political and environmental risks, commodity price and exchange
rate fluctuations, changes in legislation affecting the oil and gas
industry could cause actual results to vary materially from those
expressed or implied by the forward-looking information.
Forward-looking statements contained in this news release are made
as of the date hereof and Canadian Overseas Petroleum undertakes no
obligation to update publicly or revise any forward-looking
statements or information, whether as a result of new information,
future events or otherwise, unless so required by applicable
securities laws.
Neither the CSE nor its regulation services provider accepts
responsibility for the adequacy or accuracy of this release.
This information is provided by RNS, the news service of the
London Stock Exchange. RNS is approved by the Financial Conduct
Authority to act as a Primary Information Provider in the United
Kingdom. Terms and conditions relating to the use and distribution
of this information may apply. For further information, please
contact rns@lseg.com or visit www.rns.com.
END
AGRFAMITMTJBBMM
(END) Dow Jones Newswires
June 15, 2020 10:34 ET (14:34 GMT)
Canadian Overseas Petrol... (LSE:COPL)
Historical Stock Chart
From Apr 2024 to May 2024
Canadian Overseas Petrol... (LSE:COPL)
Historical Stock Chart
From May 2023 to May 2024