US$7.5 Million Convertible Loan
GRAND CAYMAN, CAYMAN ISLANDS--(Marketwired - May 15, 2015) - Tethys Petroleum Limited ("Tethys" or the "Company") (TSX:TPL)(LSE:TPL) is pleased to announce that it has signed and closed a binding agreement for a US$7.5 million convertible loan facility.
-- Financing: Unsecured convertible loan facility -- Principal: US$7.5 million -- Term: 2 years -- Interest rate: 9% p.a. -- Conversion price: US$0.10 -- Lender: AGR Energy Limited No. 1
John Bell, Executive Chairman, said:
"We are very pleased to complete this financing which provides security and stability for the Company as we advance the strategic review that we are working on with Macquarie Capital."
The conversion price is at a 30% premium to the one-month VWAP of US$0.0765 (closing price on May 14th, 2015 was US$0.075).
The debenture is redeemable prior to maturity for an amount equal to the principal outstanding together with any accrued interest and an early redemption fee of 3.5% of the principal amount to be redeemed. The debenture contains events of default provisions, including as a result of the failure to obtain any required governmental approvals to the conversion of the debenture.
A copy of the convertible debenture and subscription agreement will be filed on SEDAR in a timely manner.
Confirmation has been received that US$5 million has been wired to the Company with expected receipt of funds today with the remaining balance of US$2.5 million due to be received early next week.
The Company is also in discussions with a major shareholder for a facility of a lesser amount (expected to be up to c. US$2 million), on substantially the same terms.
Separately, and as an option being considered as part of the ongoing strategic review, Tethys is pleased to announce that it has entered into a limited period of exclusivity with AGR Energy Limited No. 1 ("AGR Energy") to negotiate a potential larger financing. The exclusivity period runs through to June 12th, 2015 and is subject to certain customary exceptions.
Tethys is focused on oil and gas exploration and production activities in Central Asia and the Caspian Region. This highly prolific oil and gas area is rapidly developing and Tethys believes that significant potential exists in both exploration and in discovered deposits.
About AGR Energy
AGR Energy is a company owned by the Assaubayev family, who are long-term investors in natural resources and metals and mining, and have a track record of effective investment and support of enterprises, particularly in Central Asia and other emerging markets.
This press release contains "forward-looking information". Such forward-looking statements reflect our current views with respect to future events, including the receipt by the Company of US$5 million of funds today and US$2.5 million early next week, discussions with a major shareholder for a facility of a lesser amount (expected to be up to c. US$2 million) on substantially the same terms, security and stability for the Company during a strategic review process, receipt of any required governmental approval to the conversion of the debenture and the negotiation of a potential larger financing with AGR Energy. The forward looking statements are based on the following assumptions that the US$5 million of funds will be received today by the Company and US$2.5 million of funds will be received by the Company early next week, that discussions with a major shareholder for a facility of a lesser amount (expected to be up to c. US$2 million) on substantially the same terms will be successful, the Company will have security and stability during a strategic review process, that any required governmental approvals to the conversion of the debenture will be obtained in a timely manner and that a potential larger financing with AGR Energy will be successfully negotiated. These forward looking statements are subject to a number of risks and uncertainties, including that the US$5 million of funds and US$2.5 million of funds will not be received by the Company as anticipated and within expected timeframes, that discussions with a major shareholder for a facility of a lesser amount (expected to be up to c. US$2 million) on substantially the same terms will not be successful, that the Company not having security and stability during a strategic review process, that any required governmental approvals to the conversion of the debenture are not obtained in a timely manner or at all and that a potential larger financing with AGR Energy is not successfully negotiated. See also our Annual Information Form for the year ended December 31, 2013 for a description of risks and uncertainties relevant to our business, including our exploration activities. The "forward looking statements" contained herein speak only as of the date of this press release and, unless required by applicable law, the Company undertakes no obligation to publicly update or revise such information, whether as a result of new information, future events or otherwise.
FOR FURTHER INFORMATION PLEASE CONTACT:
CAMARCO (Financial PR)
Billy Clegg / Georgia Mann
+44(0)203 757 4983
Source: Tethys Petroleum Limited