This announcement contains inside
information for the purposes of Article 7 of the UK version of
Regulation (EU) No 596/2014 which is part of UK law by virtue of
the European Union (Withdrawal) Act 2018, as amended ("MAR"). Upon
the publication of this announcement via a Regulatory Information
Service, this inside information is now considered to be in the
public domain.
6 June 2024
Echo Energy
plc
("Echo"
or the "Company")
Conditional Convertible Loan Note
Echo, the natural resources company,
is pleased to announce it has entered into a £500,000 unsecured
conditional convertible loan note ("CLN") agreement with an
institutional investor (the "Lender"). The proceeds of the CLN,
when drawn, will provide general working capital for the Company as
it progresses with a review of a potentially transformational gold
project opportunity in Latin America. The drawdowns on the CLN will
be conditional upon mutual agreement by the Lender and the
Company.
The Details of the CLN are as
follows:
·
Principal amount: £500,000
·
The Company's obligations in respect of the CLN
shall be unsecured
·
Subscription price: 94% of the principal amount
being issued
·
Maturity: 24 months
·
Coupon: zero interest
·
Conversion price: the lower of 150% of the
Company's closing share price on the day prior to a drawdown; or
90% of the Company's lowest closing bid price from the five days
prior to a drawdown
·
Conversion rights: the Lender has the right to
convert the loan into Ordinary Shares in Echo at any time whilst
any portion of the loan is outstanding
·
Redemption rights: Echo has the right to redeem
the loan in cash at any time at par plus an additional 10% of
interest. The Lender has the right to one final conversion in the
24 hours after a redemption notice for the outstanding balance has
been served by the Company
·
Funding schedule: all drawdowns are subject to
mutual agreement of the Company and the Lender
·
The Company will pay the legal fees for the
implementation of the CLN, capped at £8,000 plus VAT
·
An arrangement fee of 3.5% of the CLN is payable
by the Company
Pursuant to the CLN, the Company has
agreed to grant £50,000 of warrants to the Lender over
1,136,363,636 Ordinary Shares with a conversion price of 0.0044p,
valid for a period of three years (the "Initial Warrants"). Up to
an additional £150,000 of warrants will be issued to the Lender
proportionate to the total amount of the CLN drawdown by the
Company ("Additional Warrants"). The conversion price of the
Additional Warrants, which will be valid for a period of three
years, will be 150% of the Company's share price on the date of the
signing of the CLN. The Initial Warrants and the Additional
Warrants will be issued following the Company receiving the
required share authority to allot shares at its forthcoming AGM on
26 June 2024.
The Company and the Lender have
agreed on the first subscription request to draw down an initial
£80,000 under the CLN, providing a capital injection of £64,400
after deduction of all fees.
For
further information please contact:
|
Echo
Stephen Birrell, Chief Executive
Officer
|
Via Vigo Consulting
echo@vigoconsulting.com
|
|
WH
Ireland Limited (Nominated
Adviser)
James Joyce
James Bavister
Isaac Hooper
|
Tel: +44 (0)20 7220 0500
|
|
Vigo Consulting (Investor Relations)
Ben Simons
Peter Jacob
|
Tel: +44 (0)20 7390
0234
echo@vigoconsulting.com
|
About
Echo
Following the partial divestment of its assets
in Argentina, Echo has been active in exploring potential
opportunities to secure new assets. The Company is studying a
number of potentially transformational projects which fit with this
revised strategy. Among these potential opportunities is a gold
project in Latin America, which the Directors believe has the
potential to create significant future value for shareholders,
without requiring a large initial capital investment.
Follow us on
social media:
LinkedIn: https://www.linkedin.com/company/echo-energy-plc
X (Twitter): https://twitter.com/echoenergyplc