Tower Resources PLC Completion of Bridging Loan and Issue of Warrants (2706W)

TIDMTRP

RNS Number : 2706W

Tower Resources PLC

16 April 2019

16 April 2019

Tower Resources plc

Completion of Bridging Loan Facility

Issue of Warrants

Tower Resources plc (the "Company" or "Tower" (TRP.L, TRP LN)), the AIM listed oil and gas company with its focus on Africa, is pleased to announce that, further to the Company's announcement earlier today outlining the proposed interim financing, the Company has successfully agreed a Bridging Loan Facility ("Bridging Loan") of US$750,000 with a single lender. The terms of the Bridging Loan include the issue of 90 million of attached five-year 1.0 pence warrants.

As previously disclosed, the purpose of the Bridging Loan is to cover working capital while the Company seeks to finalise funding arrangements for the drilling of the NJOM3 well on the Thali licence in late May 2019.

Bridging Loan Facility and Issue of Warrants

The Company has agreed a short term senior secured funding facility of US$750,000 with Pegasus Petroleum Ltd, a company beneficially owned by the Company's Chairman Jeremy Asher. The material terms of the facility comprise fees of 2%, interest of 1% per month accrued and paid on repayment, a fixed and floating charge over the Company's assets, and the issue of 90 million 5-year warrants priced at 1.0 pence per share ("Warrants"), which is a premium of 38% over the Company's closing mid-market share price on 15 April 2019. The Bridging Loan will be due for repayment on or before 30 June 2019 and will have a preferential right of repayment from any future financing secured by the Company.

The issue of Warrants has been summarised in the table below.

 
 Director          Number of         Total number      Shareholding       % of issued 
                    Warrants being    of Warrants       upon exercise      share capital 
                    issued            held including    of total number    upon exercise 
                                      this issue*       of Warrants        of Warrants++ 
                                                        held 
 Jeremy Asher      90,000,000        127,908,865       198,800,360        24.5 
                  ----------------  ----------------  -----------------  --------------- 
 Peter Taylor      -                 17,190,413        35,642,139         4.4 
                  ----------------  ----------------  -----------------  --------------- 
 Graeme Thomson    -                 15,690,413        20,841,180         2.6 
                  ----------------  ----------------  -----------------  --------------- 
 

*Warrants are held at different prices

Warrants issued to Pegasus Petroleum Ltd; a company beneficially owned by Jeremy Asher

++Excludes share options

Related Party Transaction

Jeremy Asher, as a director of the Company, and Pegasus Petroleum Ltd, are considered to be "related parties" as defined under the AIM Rules and accordingly, the Bridging Loan constitutes a related party transaction for the purposes of Rule 13 of the AIM Rules.

The Directors independent of the Bridging Loan, being Peter Taylor, Graeme Thomson and David M Thomas, consider, having consulted with SP Angel Corporate Finance LLP, the Company's nominated adviser, that the terms of the Bridging Loan are fair and reasonable insofar as the Company's shareholders are concerned.

Peter Taylor, Non-Executive Director, commented:

"This funding facility provides additional working capital which we need to complete the well financing process. Our Chairman's participation reflects his continuing confidence in the Company and in our Cameroon project."

Market Abuse Regulation (MAR) Disclosure

Certain information contained in this announcement would have been deemed inside information for the purposes of Article 7 of Regulation (EU) No 596/2014 until the release of this announcement.

Contacts

 
 Tower Resources plc             [e-mail] 
 Jeremy Asher 
  Chairman and CEO 
  Andrew Matharu 
   VP - Corporate Affairs 
 
 SP Angel Corporate Finance 
  LLP 
  Nominated Adviser and Joint 
  Broker                         [phone] 
 Stuart Gledhill 
  Caroline Rowe 
 
 Turner Pope Investments 
  (TPI) Limited 
  Joint Broker 
  Andy Thacker                   [phone] 
 Whitman Howard Limited 
  Joint Broker 
  Nick Lovering 
  Hugh Rich                      [phone] 
 Yellow Jersey PR Limited        [phone] 
 Tim Thompson 
 

Notes:

Tower Resources Cameroon S.A, a wholly-owned subsidiary of Tower Resources plc, holds a 100% interest in the shallow water Thali (formerly known as "Dissoni") Production Sharing Contract (PSC), in the Rio del Rey basin, offshore Cameroon. Tower was awarded the PSC on 15 September 2015 for an Initial Exploration Period of 3 years, which has been extended for a further year ending 15 September 2019.

The Thali PSC covers an area of 119.2 km(2), with water depths ranging from 8 to 48 metres, and lies in the prolific Rio del Rey basin, in the eastern part of the Niger Delta. The Rio del Rey basin has, to date, produced over one billion barrels of oil and has estimated remaining reserves of 1.2 billion barrels of oil equivalent ("boe"), primarily within depths of less than 2,000 metres. The Rio del Rey is a sub-basin of the Niger Delta, an area in which over 34.5 billion barrels of oil has been discovered, with 2.5 billion boe attributed to the Cameroonian section.

An independent Reserve Report conducted by Oilfield International Limited (OIL) has highlighted the contingent and potential resources on the Thali licence and the associated Expected Monetary Value (EMV) as follows:

-- Gross mean contingent resources of 18 MMbbls of oil across the proven Njonji-1 and Njonji-2 fault blocks;

-- Gross mean prospective resources of 20 MMbbls of oil across the Njonji South and Njonji South-West fault blocks;

-- Gross mean prospective resources of 111 MMbbls of oil across four identified prospects located in the Dissoni South and Idenao areas in the northern part of the Thali licence;

-- Calculated EMV10s of US$118 million for the contingent resources, and US$82 million for the prospective resources, respectively.

In accordance with the guidelines for the AIM market of the London Stock Exchange, Dr Mark Enfield, BSc, PhD, FGS, Advisor to the Board of Tower Resources plc, who has over 30 years' experience in the oil & gas industry, is the qualified person that has reviewed and approved the technical content of this announcement.

NOTIFICATION AND PUBLIC DISCLOSURE OF TRANSACTIONS BY PERSONS DISCHARGING MANAGERIAL RESPONSIBILITIES AND PERSONS CLOSELY ASSOCIATED WITH THEM:

MANAGERIAL RESPONSIBILITIES AND PERSONS CLOSELY ASSOCIATED WITH THEM

 
 1.   Details of the person discharging managerial responsibilities/person 
       closely associated 
 a)   Name:                              Jeremy Asher 
     ---------------------------------  ---------------------------------------- 
 2.   Reason for the notification 
     --------------------------------------------------------------------------- 
 a)   Position/status:                   Chairman and Chief 
                                          Executive Officer 
     ---------------------------------  ---------------------------------------- 
 b)   Initial notification/Amendment:    Initial notification 
     ---------------------------------  ---------------------------------------- 
 3.   Details of the issuer, emission allowance market participant, 
       auction platform, auctioneer or auction monitor 
     --------------------------------------------------------------------------- 
 a)   Name:                              Tower Resources PLC 
     ---------------------------------  ---------------------------------------- 
 b)   LEI:                               2138002J9VH6PN7P2B09 
     ---------------------------------  ---------------------------------------- 
 4.   Details of the transaction(s): section to be repeated 
       for (i) each type of instrument; (ii) each type of transaction; 
       (iii) each date; and (iv) each place where transactions 
       have been conducted 
     --------------------------------------------------------------------------- 
 a)   Description of the financial       Ordinary Shares of 
       instrument, type of instrument:    1 pence each 
       Identification code:               GB00BZ6D6J81 
     ---------------------------------  ---------------------------------------- 
 b)   Nature of the transaction:         Warrants attached 
                                          to loan 
     ---------------------------------  ---------------------------------------- 
 c)   Price(s) and volume(s):             Price(s)      Volume(s) 
                                           1.00 pence    90,000,000 
                                                        ----------- 
     ---------------------------------  ---------------------------------------- 
 d)   Aggregated information:            Single transaction 
       Aggregated volume:                 as in 4 c) above Price(s)    Volume(s) 
       Price:                              1.00 
                                            pence      90,000,000 
     ---------------------------------  ---------------------------------------- 
 e)   Date of the transaction:           16 April 2019 
                                          07:00 GMT 
     ---------------------------------  ---------------------------------------- 
 

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April 16, 2019 02:30 ET (06:30 GMT)