Tethys Share Discussion Threads

[hguess16] 05/12/2016 12:51

"If the Kumars really wanted to invest they could have just agreed an additional larger placing with TPL and ..... buy up to 180m shares "
At what price ?. At 1.593 cents per share ?.
Is that what you are saying ?.
I think that a warrant exercise price is a bet by the Kumars over a 3 year period at
3.1 cents per shatre expecting the share price to exceed the current low market price!.
I certainly would not agree to the Kumars taking 181m shares at 1.593 cents !.
So you would rather give the Kumars 181m shares at 1.593 cents per share ?.
Your suggestion makes no sense !.

[casual47] 05/12/2016 11:05

1. I didn't quote you, I responded to a claim you made.

2. The claim you made leaves no room for interpretation: [QUOTE] "If the Tethys share price does not rise above 3.1 cents or 2.48p within the 3 year period, the warrants expire." [END QUOTE], this is clearly untrue.

3. TPL did not explain why they are issuing warrants the equivalent of 30% of the company. So nobody can understand, even you. We can only try to understand, which I have been doing.

4. Name me one company which deemed it reasonable to issue warrants that represent 30% of the company. Again, you don't seem to understand what it is I have an issue with.

5. The $5-odd million they will potentially raise from the warrants will do nothing to fix the $51 million current liabilities they have. Note the word "current", as in "must be settled within the next 12 months from when Q3 was published"

6. Warrants have ZERO influence on share price while share price is below exercise price. However, they CAN act as a drag on share price once share price goes above exercise price, especially when the pending warrants represent such a huge % of the company. Think about it.

7. TPL conceding such a huge number of warrants (which is potentially unprecedented for a London/Toronto listed company), and having attached to it the "gun against the head" clause if shareholders don't agree to it, is a sign of WEAKNESS of the BOD and not a sign of Kumars being friendly/supportive.

8. If the Kumars really wanted to invest they could just have agreed an additional larger placing with TPL and have signed a binding contract with TPL to buy up to 180 million shares. They didn't. They insisted on warrants, and even on doubling the warrants initially agreed and communicated via RNS. Why? Warrants carry 0% risk to the Kumars, and 100% risk to TPL. 0% risk because if TPL goes t1ts up then Kumars can just walk away. 100% risk because: 1. if shareholders don't agree TPL need to IMMEDIATELY pay the Kumars (for doing what exactly???) and 2. If TPL are relying on Kumars to inject further money via Warrants they have zero certainty they will as warrants are OPTIONS, not a legally binding contract.

[hguess16] 05/12/2016 10:38

Casual,
You are deliberately misquoting me for your own spurious reasons in trying to justify
your rejection of the Kumars wish to take up the warrants.
I never said that the Kumars will not exercise when the share price is lower than the exercise price. All I said was that the warrants expire at the end of the 3 year period.
Just like your Cayman " obsession" loan, you try to undermine the issue of warrants to the Kumars by not understanding why Tethys agreed to the increase in the number of warrants issued to the Kumars.
It is simple !. Warrants are less costly than short term high interest loans and provide an upside to the warrant holder if the share price exceeds the exercise price.
Tethys is currently immersed in short term loans incl your Cayman obsession.
Hence Tethys and the Kumars agreed on Warrants !.

[casual47] 05/12/2016 10:27

Thanks N74. Are the Kaz/KASE restrictions triggered no matter what or just for e.g. holdings that go above 30%?

It was pretty odd for TPL to suddenly come up with these two individual investors but perhaps there is a motivation behind it if treating the two shareholders as non-related means they can each remain under e.g. TSX and KASE thresholds of 20%

[naimanka74] 05/12/2016 10:19

"I don't know why the Olisol deal was subject to such restrictions but I wonder if the warrants are a way to circumvent these restrictions?

Anyone with actual knowledge rather than wishful thinking got any feedback on this?"

Once exercised the KASE ruling applies (as it's new shares being issued and Kazakhstan is their main place of business, perhaps arguable with no gas sales but…), looking back on Tethys under Robson they never did this, so the company is exposed historically.

[hguess16] 05/12/2016 08:46

Why warrants ?.
Extracted from comments on warrants !.
Warrants enable additional participation in the company's growth while it also causes dilution, as a company is obligated to issue new stock, when the warrants are exercised.
Warrants may also bring down the cost of financing and provide additional capital if the stock does well.
If the Tethys share price does not rise above 3.1 cents or 2.48p within the 3 year
period, the warrants expire.

To summarise, the Kumars are expecting the share price to rise above the exercise price of 2.48p within the 3 year period. The Kumars are in the money if the share price exceeds the exercise price of 2.48p !.
Tethys benefits via the support of the Kumars, and improved financing !.

[dorset64] 04/12/2016 23:24

casual473 Dec '16 - 16:53 - 12672 of 12685 0 0

Also, while I assume that the Kumars WILL immediately take up their warrants, ....there is no guarantee that they will as the warrants remain exercisable for three years.

==========================================

You're even arguing with yourself now Casual437 !!

[seroserio] 04/12/2016 17:13

Doesn't this share make you long for a company that's straightforward like a shop that sells pies or TVs or clothes? :-)

[casual47] 04/12/2016 13:14

I think the answer may be: as the Kumars are regarded as non-related parties they will only have up to 20% shareholding each. Which may be the reason why they don't trigger any restrictions?

Still doesn't explain why they chose to give them such an extraordinary amount of warrants.

[casual47] 04/12/2016 12:49

The Olisol deal was contingent on Kaz approval, also, at least 20% of the to be issued Olisol shares had to be listed on Kaz stock exchange.

I don't know why the Olisol deal was subject to such restrictions but I wonder if the warrants are a way to circumvent these restrictions?

Anyone with actual knowledge rather than wishful thinking got any feedback on this?

[naimanka74] 04/12/2016 12:36

It takes about 4 weeks for a PIF, so by the EGM it will ok for them to convert the lot, I expect they will baring any surprises. I see "by coincidence" they are both using the same lawyers, how convenient.


I know exactly what I would do, however I think not for here.


Sell on Monday....common sense says yes but....I am not sure....in a strange way I am tempted to buy more, will see a shrink Monday !

[hguess16] 04/12/2016 09:10

As I see it, there is no alternative but to grit one's teeth and face up to the critical financial position that Tethys is faced with.
The company, faced with short term debts and serious local difficulties,had no alternative but to accept a dollop of cash from the Kumars which would provide it with some respite.
As the current share price was ridiculously low, the Kumars stepped in when no one else was willing to come forward.
ICA and EGG, who are currently the only customers for Tethys products, decide to go on strike for spurious reasons at the instigation of Abramov, who has failed to capture Tethys, his trophy, and hence put Tethys in a bind in the short term.
In come the Kumars, who see a great opportunity to team up with the new team, Wells and May. In the final negotiations, the Kumars realise that more cash would be welcome by Tethys, which is in the emergency ward right now !.
So they double up on their bet and agree to subscribe 96m each rather than 44m of the warraants at the same 3.1p.
This provides Tethys with much needed cash of $7.4m (1.4m + 5.9) which could be a backstop used to pay off the amounts due to Oliosl ( W/C) if necessary and the Kumar assisted bank loan ( assumed $10m) could be used to pay Cayman with some left over to start drilling the shallow gas wells.
I am hoping that EGG and ICA will come back soon as consumers for Tethys oil and gas products.
The Kumars ( IMO) have decided invest in Tethys and its new team because they see an excellent opportunity to align its interests with Wells and his team and hopefully make a bundle in the process.
I do hope things do not go pear shaped. I am staying on for the ride as there is no alternative!.

[1399peter] 04/12/2016 07:25

Casual

I appreciate that but doesn't this vote only allow them to exercise the 12m and isn't it saying approval will need to be gained each time and only allow more if they don't cross the 10% threshold, or am I missing something here.

Edit: Mind you I also think it's a ridiculous amount of warrants, and potentially something that could drag on the share price if things ever get going in the right direction.

[hguess16] 03/12/2016 19:39

Casual,
Let me remind you that the reason why the Tethys share price failed to pick up on the Oilosl deal was because they kept on delaying the take-up and it became clear that they lacked the cash to complete or they deliberately prevaricated hoping to take control via the back door. Abramov,as Chairman at the May 15 AGm, agreed to abide by the resolutions and then welched on the deal by trying to use working capital to contribute to the 181m shares. Skripka, the disciple, who committed to arranging the
bank loan then failed to deliver !.
Somehow, I feel that the Kumars are more confident about keeping their promise.
Hence their wish to more than double their warrants entitlement.
Anyway, the proof of the pudding is in its consumption.
As regards your concern about the Cayman loan, I am hoping that the Kumars help in
restructuring the finances of Tethys should help to solve that issue.

[neilyb675] 03/12/2016 19:34

expensive life support BUT if it means TPL survival then surely that is better than going to the wall ?

What is the alternative ?

For sure the Kumars have been in the background for some time - and no doubt Olisol were aware of them, prior to the dirty tricks campaign. The trigger for the DT campaign was when the Kumars came to the forefront of the funding circle.

[casual47] 03/12/2016 17:45

Of course, if the BOD has already agreed with the Kumars to massively dilute the company then the 180m warrants suddenly become much more like the typical cherry on top.......

[temporarily insane] 03/12/2016 17:38

Thank you Casual47.

[casual47] 03/12/2016 17:33

Peter, yes, that's why there is an EGM 27th January. To allow them to do it.

TI, warrants are meant to be just a sweetener, to mollify the investor and convince them to invest. They are just the cherry on top, if you like. Typically the investor would only take up warrants when the share price is much higher than the warrant exercise price so they make a profit. On paper at least.

Also, who has ever heard of warrants representing nearly a third of the company? It is completely bonkers.

[1399peter] 03/12/2016 17:27

If both Investors were to exercise all of the Warrants granted to
them, each Investor would own approximately 19.9% of the ordinary shares
of the enlarged share capital of the Company. Neither Investor may
exercise any warrants if after such exercise, the Investor would become
a 10% shareholder of the Company until such time as the Toronto Stock
Exchange ("TSX") has approved a personal information form (a "PIF") to
be submitted by such Investor. Further, the Investors may not exercise
more than an aggregate of 12,097,816 warrants unless shareholder
approval has been obtained for such exercise.

[temporarily insane] 03/12/2016 17:00

casual47 why would the Kumars taking up all their warrant prove this whole thing is a stitch up?

[casual47] 03/12/2016 16:53

Also, while I assume that the Kumars WILL immediately take up their warrants, and that would prove this whole thing is a stitch up, there is no guarantee that they will as the warrants remain exercisable for three years.

[casual47] 03/12/2016 16:39

Hguess, why would the share price go up? Olisol had paid 10 US cents for their shares and were going to add more at 3 pence. Yet the share price remained below 2p for months.

Also, I have close to 2 million shares. With TPL being so illiquid there is no chance I can offload that amount at a reasonable price.

The EGM is 27th January. The 8 million USD + interest Cayman loan is due a month later.

[hguess16] 03/12/2016 16:32

Casual, You seem to have got Naim on steroids with your post !.
If you look at the numbers, you will notice that the Kumars are paying over 2p for their total allocation of 280.2m shares incl the warrants.
You said in an earlier post that you would exit if the price gets to 2p.
So you have the option to exit when the Kumars enter the Tethys stage and help grow the company !.

[temporarily insane] 03/12/2016 16:31

Ok naimanka74, you complain more than me!!!! ;-)


I put this question to you. How would you do it????? Or are you selling first thing Monday morning.


Everybody seems to be an expert but nobody wants to say how to make all this right. All quite easy when behind a keyboard.