Tethys Petroleum Ltd Tethys Petroleum Limited Press Release: Letter of Intent for a US$15 Million Interim Financing and C$25....

 
TIDMTPL 
 
Tethys Petroleum Limited Press Release: Letter of Intent for a US$15 Million Interim Financing and C$25.5 Million Private Placement Signed With Olisol Investments Limited 
FOR:  TETHYS PETROLEUM LIMITED 
 
TSX, LSE SYMBOL:  TPL 
 
November 9, 2015 
 
Tethys Petroleum Limited Press Release: Letter of Intent for a US$15 Million Interim Financing and C$25.5 Million 
Private Placement Signed With Olisol Investments Limited 
 
GRAND CAYMAN, CAYMAN ISLANDS--(Marketwired - Nov. 9, 2015) - 
 
NOT FOR DISTRIBUTION IN THE UNITED STATES OR TO US NEWSWIRE SERVICES OR ANY OTHER JURISDICTION IN WHICH IT WOULD 
BE UNLAWFUL TO DO SO. ANY FAILURE TO COMPLY WITH THIS RESTRICTION MAY CONSTITUTE A VIOLATION OF THE SECURITIES 
LAWS OF SUCH JURISDICTIONS. THE OFFERS AND SALES OF SECURITIES REFERRED TO BELOW HAVE NOT BEEN AND WILL NOT BE 
REGISTERED UNDER THE SECURITIES ACT OF 1933 AND MAY NOT BE OFFERED OR SOLD IN THE UNITED STATES ABSENT 
REGISTRATION UNDER THE SECURITIES ACT OR AN EXEMPTION FROM SUCH REGISTRATION. 
 
Tethys Petroleum Limited ("Tethys" or the "Company") (TSX:TPL)(LSE:TPL) announces that is has entered into a non- 
binding and indicative letter of intent (the "LOI") with Olisol Investments Limited ("Olisol") setting out 
proposed terms upon which Olisol Petroleum Limited, a wholly-owned subsidiary of Olisol ("OPL"), will provide 
Tethys with a US$15 million interim debt facility (the "Interim Financing"), subscribe to a C$25.5 million private 
placement of 150 million new ordinary shares at a price of C$0.17 per ordinary share (the "Placing") and commit to 
backstop a further equity fundraising of 50 million shares at C$0.17 per share (the "Further Financing"). 
 
The Company has agreed to grant OPL a limited period of exclusivity the ("Exclusivity Period") until 11:59 p.m. 
Calgary time on November 23, 2015 (unless such date is extended by request of one of the parties) in connection 
with the Placing and Further Financing and Interim Financing (together the "Transaction"). 
 
In the event that OPL does not provide Tethys with certain confirmation of funds by November 23, 2015, Olisol will 
pay Tethys a US$1.25 million break fee. The Company and Olisol have substantially progressed the binding 
documentation for the Transaction. The Company expects to provide an update on these agreements prior to the 
expiration of the Exclusivity Period. 
 
John Bell, Executive Chairman commented: 
 
"We are pleased to have reached conditional agreement with Olisol on a potentially transformational refinancing 
and will work as hard as we possibly can to drive the process to a swift conclusion." 
 
Summary 
 
Interim Debt Financing 
 
/T/ 
 
=-  Concurrent with the execution of the LOI, OPL and Tethys have largely 
    agreed the documentation for a US$15 million convertible facility 
    pursuant to which OPL will advance to Tethys up to US$15 million to be 
    used to repay the US$5 million term loan from Nostrum Oil and Gas PLC 
    and the US$7.5 million convertible loan from AGR Energy Limited No. 1 
    (the "AGR Convertible"), in each case plus any accrued but unpaid 
    interest and fees arising thereunder. In the event that AGR Energy 
    exercises its conversion rights under the AGR Debenture prior to 
    redemption, the interim loan facility will be reduced by US$7.5 million 
    with the Placing, at the option of OPL, being increased by US$7.5 
    million in exchange for 75 million further shares. US$12.5 million will 
    be available immediately to repay and discharge the above-noted 
    facilities. The balance of the interim loan facility will be used for 
    general and administrative expenses and will be available thirty days 
    after first draw down or, where requested by Tethys to meet its working 
    capital requirements, such earlier date as the parties may agree. The 
    loan shall be convertible at C$0.17 per share. 
 
=-  Olisol is required to provide to Tethys confirmation that the US$15 
    million is ready to be drawn down, within 14 days, or will be required 
    to pay a break fee to Tethys of US$1.25 million. In this event, the 
    Exclusivity Period will also come to an end. 
 
=-  It will be a condition to the first draw down under the Interim 
    Financing that Alexander Abramov, a designee of Olisol, and William 
    Wells of Pope Asset Management, LLC, a 19.1% shareholder of the Company, 
    be appointed to the Board of Directors of Tethys (the "Board"). In the 
    event the Placing is not completed, the Olisol designee will resign once 
    the Interim Financing is repaid in full. 
 
=-  Olisol has agreed to assist in the extension of the Kul-Bas licence in 
    Kazakhstan. If Tethys and Olisol are not able to secure an extension of 
    the Kul-Bas licence, Olisol will increase its obligation in connection 
    with the Interim Financing by C$1.0 million. 
 
=-  Assuming the Interim Financing is issued, the Interim Financing will 
    become due and payable after 30 days if both parties do not enter an 
    investment agreement for the Placing (the "Investment Agreement") within 
    the Exclusivity Period. The Interim Financing will become due and 
    payable after 30 days should closing of the Placing not have occurred 
    within 90 days of signing an Investment Agreement (or such longer period 
    provided for by the Investment Agreement). 
 
=-  Pursuant to the terms of the Interim Financing, the Company will be 
    subject to certain restrictions including on undertaking any material 
    corporate activity, creating new indebtedness (subject to certain 
    permitted exemptions) or repaying indebtedness in advance of its 
    maturity date; creating any security or giving guarantees or indemnities 
    and entering into further financings or issuing further equity. 
 
=-  The Interim Financing facility will also contain events of default and 
    change of control provisions. In circumstances where an event of default 
    has occurred and OPL agrees to waive such event of default, the Company 
    is required to take such actions as OPL may specify for the exercise of 
    any rights, powers and remedies of OPL under the agreement or by law, 
    and/or confer on OPL security over any property and assets of the 
    Company's group to the fullest extent permitted under the terms of any 
    existing third party security arrangements. 
 
/T/ 
 
A copy of the interim financing facility agreement will be filed on SEDAR in Canada once executed. 
 
Placing and Further Financing 
 
/T/ 
 
=-  Tethys and Olisol will negotiate a definitive Investment Agreement 
    providing for the Placing and commitment to backstop the Further 
    Financing over the next 14 days. 
 
=-  An additional injection of C$25.5 million of new capital into Tethys by 
    OPL by way of a subscription for 150 million Shares at C$0.17 per share, 
    subject to AGR Energy exercising its conversion rights prior to 
    repayment of the AGR Convertible, in which case the Placing, at the 
    option of OPL, being increased by US$7.5 million in exchange for 75 
    million further shares. 
 
=-  Conversion of all outstanding amounts under the Interim Financing into 
    shares of Tethys at C$0.17 per share. 
 
=-  Following completion of the Placing, the Company proposes to undertake 
    the Further Financing to be backstopped by OPL to ensure that a minimum 
    of C$8.5 million is raised. 
 
=-  Upon completion of the transaction, the Board will be comprised of five 
    directors as follows: 
 
    --  Williams Wells, non-executive director; 
    --  One non-executive director designated by OPL; 
    --  One non-executive and independent director designated by OPL; 
    --  One executive director designated by Tethys; and 
    --  One non-executive and independent director designated by Tethys. 
 
=-  The ongoing composition of the Board shall be determined by a 
    relationship agreement containing reasonable provisions intended to 
    address conflicts of interest and related party matters and compliance 
    with applicable laws and listing requirements (the "Relationship 
    Agreement"). The Relationship agreement will only apply in the event 
    that OPL acquires shares to which are attached more than 30 percent of 
    the outstanding voting rights over the entire issued shares capital of 
    Tethys. Entering into the definitive form of such an agreement will be a 
    mutual condition precedent to completing the transactions contemplated 
    by the Investment Agreement. 
 
=-  In addition to customary closing conditions for transactions of this 
    nature, OPL's obligation to complete the Placing shall be subject to 
    satisfaction or waiver of the following: 
 
    --  receipt of all required approvals from the Government of Kazakhstan; 
    --  receipt of all required shareholder, regulatory, exchange and other 
        third party approvals; and 
    --  aggregate debt of Tethys, net of cash, being not greater than US$40 
        million (excluding the Interim Financing). This will also need to be 
        true at the date of signing the Investment Agreement. 
 
=-  The proposed Interim Financing, Placing and Further Financing are not 
    subject to either a financing condition or a due diligence condition. 
 
=-  Olisol has advised Tethys that it has access to a US$51 million credit 
    facility from a leading Kazakh bank (all of which is undrawn) in support 
    of the Transaction. Certain supporting information has been provided and 
    the provision of further confirmatory documents is provided for under 
    the LOI. 
 
=-  Once the Investment Agreement has been entered into, the Company 
    anticipates that an additional eight weeks would be required to complete 
    the Placing. The Placing and Further Financing are subject to regulatory 
    approvals, including approval of the Toronto Stock Exchange, and 
    shareholder approval as required by the rules of the Toronto Stock 
    Exchange. 
 
/T/ 
 
Tajikistan Asset 
 
As previously disclosed to the market on October 12, 2015, defaults have been declared under the Tajikistan 

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