REG - SDX Energy PLC - Update on Convertible Loan

SDX EnergyAnnouncement

26/09/2024 07:00

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RNS Number : 7110F  SDX Energy PLC  26 September 2024

THE INFORMATION CONTAINED WITHIN THIS ANNOUNCEMENT IS DEEMED BY SDX TO
CONSTITUTE INSIDE INFORMATION AS STIPULATED UNDER THE MARKET ABUSE REGULATION
(EU) NO. 596/2014 ("MAR"). ON THE PUBLICATION OF THIS ANNOUNCEMENT VIA A
REGULATORY INFORMATION SERVICE ("RIS"), THIS INSIDE INFORMATION IS NOW
CONSIDERED TO BE IN THE PUBLIC DOMAIN.

 

26 September 2024

 

SDX ENERGY PLC ("SDX" or the "Company")

UPDATE ON CONVERTIBLE LOAN

As announced on 4 September 2024, the Company and Aleph Finance Ltd (the
"Lender") signed a new agreement (the "New Facility Agreement") that would
refinance the Company's syndicated unsecured convertible loan agreement with
the Lender for up to US$3.25 million (the "Existing Convertible Loan").

The Existing Convertible Loan is unsecured, convertible at any time at the
option of the individual lenders and repayable on 24 July 2024, but the
Company requested and the Lender consented and agreed to repayment now being
delayed until 14 October 2024. The amount payable is US$3.82 million
(principal US$3.25 million and interest US$0.57 million).

The Lender and the Company have now agreed to amend the terms of the New
Facility Agreement to refinance the Existing Convertible Loan (the "Amended
Facility Agreement"). The revised key terms of the Amended Facility Agreement
are:

Under the terms of the Amended Facility Agreement, the Lender will provide a
term loan facility in the amount of up to US$6,500,000, such total amount to
be confirmed by the Lender (the "Loan"), to the Company to be repaid by 23
July 2025. Following repayment of the Existing Convertible Loan, the Company
intends to draw on approximately US$2.0 million of the remaining balance of
the Loan. Following the repayment of existing financial indebtedness owed by
the Company to the Lender under the Existing Convertible Loan and other
agreements, the Company will apply the balance of the monies borrowed under
the Amended Facility Agreement towards capital expenditure in Morocco and
general corporate creditors. The Amended Facility Agreement is also
conditional on the Lender confirming that it has been funded by its
sub-participants and delivering a funding statement covering the amount of the
Loan.

The Loan will be available for drawdown within six months of the satisfaction
or waiver of the conditions precedent under the Amended Facility Agreement.
The conditions are usual for a facility of this nature and include the Company
securing shareholder approval.

In connection with the Amended Facility Agreement, the Company will grant the
Lender the following security package:

(i)            a pledge over the Company's shares in SDX Energy
Morocco (Jersey) Ltd;

(ii)           a pledge over the Company's shares in Sea Dragon
Energy (Nile) B.V.;

(iii)         a debenture over the Company, including assignment of
intercompany loans and security over HSBC bank accounts in England; and

(iv)      a security agreement, in the form of a pledge, granted by SDX
Energy Morocco (Jersey) Ltd and/or SDX Energy Morocco (UK) Ltd in respect of
rights and receivables that may be derived from Moroccan licences (being Sebou
Central, Lalla Mimouna Sud, and Rharb Occidental).

All outstanding amounts under the Amended Facility Agreement shall accrue
interest at a rate of 20% per annum. Interest will be capable of being paid in
kind and added to the principal outstanding. A consent fee of US$195,677 in
lieu of interest for the period from 24 July 2024 to 14 October 2024 and an
arrangement fee of US$170,889 shall be payable and capitalised into the
Amended Facility Agreement.

The Lender will have the right to convert the outstanding Loan, including any
accrued, in full or in part, into ordinary shares in the capital of the
Company ("Ordinary Shares") at an exercise price (the "Exercise Price") being
80% of the Average Daily Closing Price calculated over 30 trading days
preceding the relevant date of notification for conversion, provided that the
number of Ordinary Shares issued to the Lender pursuant to the Amended
Facility Agreement does not exceed the lower of (i) 300,000,000, and (ii) the
sum of 200,000,000 plus 50 multiplied by the amount of any loans drawn during
the term of the Amended Facility Agreement (the "Threshold"). If the number of
Ordinary Shares to be issued, based on the Exercise Price, would mean that the
Threshold is met, then the portion of the Loan representing the excess
Ordinary Shares will not be converted and will remain outstanding on the terms
of the Amended Facility Agreement.

On 14 October 2024, the Company plans to convene a general meeting to ask
shareholders to vote on the Amended Facility Agreement (the "General
Meeting"). The completion of the Amended Facility Agreement is conditional
upon the Company's shareholders voting in favour of the resolutions at the
General Meeting.

The directors consider that the resolutions to be proposed at the General
Meeting will promote the success of the Company for the benefit of its
shareholders as a whole. Accordingly, the directors intend to recommend that
shareholders vote in favour of all of the resolutions, as they intend to do in
respect of their own beneficial holdings.

Shareholders should note that, in the event that the resolutions are not
passed, the Amended Facility Agreement will not become unconditional and the
Existing Convertible Loan will be due for repayment on 14 October 2024.
Therefore, if the resolutions are not passed, the Company will not be able to
repay the Existing Convertible Loan and would be in default and, if no
alternative arrangements can be agreed with the Lender, may become insolvent.

For further information:

 

 SDX Energy Plc

 Daniel Gould, Chief Executive Officer

 William McAvock, Chief Financial Officer

 Tel: +44 (0) 20 3219 5640

 Shore Capital (Nominated Adviser and Broker)

 Toby Gibbs/Harry Davies-Ball

 Tel: +44 (0) 20 7408 4090

 InHouseIR (Investor and Media Relations)

 Sarah Dees/Oliver Clark

 Email: sdx@inhouseir.com

 Tel: +44 (0) 7881 650 813 / +44 (0) 20 3239 1669

About SDX

For further information, please see the Company's website at
www.sdxenergygroup.com
(https://url.avanan.click/v2/___http:/www.sdxenergygroup.com/___.YXAxZTpzaG9yZWNhcDphOm86MDEzNTAyODI2ZTNhZWY5ZWM4YWU4MGY3MmNiNjhiMDc6Njo4MDY2OmIyZDJhNDdjNTNhNWU3Yjc5Y2VjZDQ5MzgxZTRkZWJlNTE2NjQyYTMwOTk0NmQwOGZjN2U4MWIyMzIxODExNjM6cDpU)
or the Company's filed documents at www.sedar.com
(https://url.avanan.click/v2/___http:/www.sedar.com/___.YXAxZTpzaG9yZWNhcDphOm86MDEzNTAyODI2ZTNhZWY5ZWM4YWU4MGY3MmNiNjhiMDc6NjplNWE4OjE1YTQ5NzZmMjEyMWQ5MjgyZjhkZjI1YmQzNmU3YzE3ODdlMWMyY2MwM2E4YjBiYTJmY2M3ODk2ZWE5MmI3YTM6cDpU)
.

 

Forward-looking information

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"forward-looking information" as such term is used in applicable Canadian
securities laws. Any statements that express or involve discussions with
respect to predictions, expectations, beliefs, plans, projections, objectives,
assumptions or future events or are not statements of historical fact should
be viewed as forward-looking information.

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