REG - Echo Energy PLC - Conditional Convertible Loan Note

Echo EnergyAnnouncement

06/06/2024 07:00

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RNS Number : 3239R  Echo Energy PLC  06 June 2024

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                                       Via Vigo Consulting

 Stephen Birrell, Chief Executive Officer   echo@vigoconsulting.com (mailto:echo@vigoconsulting.com)
 WH Ireland Limited (Nominated Adviser)     Tel: +44 (0)20 7220 0500

 James Joyce

 James Bavister

 Isaac Hooper

 Vigo Consulting (Investor Relations)       Tel: +44 (0)20 7390 0234

 Ben Simons                                 echo@vigoconsulting.com

 Peter Jacob

 

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
(https://www.linkedin.com/company/echo-energy-plc)

X (Twitter): https://twitter.com/echoenergyplc
(https://twitter.com/echoenergyplc)

 

 

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