18:00 Fri 11 Dec 2020
Salt Lake Potash Ltd - Fundraising & Lifting of ASX Voluntary Suspension
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AIM/ASX Code: SO4
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SALT LAKE POTASH LIMITED |
Institutional Placement to achieve Financial Close
Salt Lake Potash Limited (SO4 or the Company) is pleased to announce that it has received binding commitments for a successful share placement to institutional shareholders and other investors to raise up to
Equity Placement
· The Company has received binding commitments from institutional shareholders, sophisticated investors and directors to subscribe for 130 million new ordinary shares at
Debt Financial Close and first draw
· As announced on
Share Purchase Plan
· The Company plans to undertake a non-underwritten Share Purchase Plan (SPP) to raise up to a further
Uses of capital raising proceeds
· The proceeds from the Placement and SPP will be used to cash back a bank guarantee for the APA gas pipeline (
· The Lake Way Project remains on track for first sulphate of potash (SOP) production in
TONY SWIERICZUK, Chief Executive Officer
"SO4 is pleased to have completed this placement of up to
Debt Financial Close and First Draw
As announced on
The lending group has now confirmed to the Company that all conditions precedent to the first drawdown have been satisfied or waived, save for:
· Completion of equity raise of at least
·
· The payment of transaction fees; and
· Repayment of the
The balance of the debt is expected to be drawn down in Q2'21 subject to market standard conditions. The material terms of the SFA remain unchanged and are summarised in Table 1 below.
Table 1: Syndicated Facility Agreement Key Terms
Facility Amount |
|
Tenor |
4 Years ( |
Availability Period |
Financial close until |
Interest rate |
9.0% per annum payable quarterly on drawn funds |
Upfront Fee |
2.75% (paid) |
Undrawn Commitment fee |
2.5% per annum |
Tranches |
Bridge: SFA: |
Amortisation/Repayment |
No scheduled repayments or debt amortisation until Additional cash sweep of 70% of surplus cash available for debt service accelerating SO4's deleveraging |
Debt Service Reserve Account |
|
Bullet |
|
Refinancing Restrictions |
Nil 18 months after signing |
Equity financing
SO4 is raising up to
·
·
·
·
· Up to a further
Placement details
The Company has received firm commitments to raise gross proceeds of
In addition, SO4 Directors have committed to subscribe for up to 5.0 million Placement Shares, including 3.0 million shares by Chairman, Mr Ian Middlemas and 0.5 million shares by Managing Director and CEO, Mr Tony Swiericzuk, subject to shareholder approval. If approved by shareholders, this would raise an additional
The Placement is comprised of two tranches:
· Tranche 1, comprising the issue of 66,593,631 Placement Shares under Listing Rule 7.1, and 58,406,369 Placement Shares under Listing Rule 7.1A. The Tranche 1 Placement Shares are expected to be issued on or around
· Tranche 2, comprising the issue of 5,025,000 Placement Shares to Directors, subject to the receipt of prior approval of the Company's shareholders. A general meeting to seek the requisite approval will be convened shortly, with the meeting expected to be held in late
The issue price of
Euroz Hartleys Securities Limited and Canaccord Genuity Group Inc. were appointed as joint lead managers and bookrunners to the Placement. Cenkos Securities plc acted as Co-manager.
Related Party transactions
The proposed participation in the Placement by Mr Ian Middlemas (3.0m shares), Mr Tony Swiericzuk (0.5m shares), Mr Philip Montgomery (1.25m shares), Mr Matthew Bungey (150,000 shares), Mr Peter Thomas (125,000 shares), and the subscription for 13.75m shares in the Placement by Lombard Odier Asset Management (Europe) Limited, a substantial shareholder in the Company, constitute related party transactions under Rule 13 of the AIM Rules for Companies. The independent director, Mr Bryn Jones, having consulted with the Company's nominated adviser, Grant Thornton UK LLP, considers that the terms of the transactions are fair and reasonable insofar as the Company's shareholders are concerned.
Settlement and dealings
Application will be made to the AIM Market of the London Stock Exchange ("AIM") for 125,000,000 Ordinary Shares, pursuant to the Placement, which rank pari passu with the Company's existing issued Ordinary Shares, to be admitted to trading. Dealings on AIM are expected to commence at
Total Voting Rights
For the purposes of the Financial Conduct Authority's Disclosure Guidance and Transparency Rules (DTRs), following Admission of the first tranche of shares, SO4 will have 710,312,487 Ordinary Shares on issue with voting rights attached. SO4 holds no shares in treasury. This figure of 710,312,487 may be used by shareholders in the Company as the denominator for the calculations by which they will determine if they are required to notify their interest in, or a change to their interest in the Company, under the ASX Listing Rules or the DTRs.
Share Purchase Plan
The Company plans to undertake a non-underwritten SPP to raise up to
The SPP will enable existing eligible shareholders and depositary interest holders, irrespective of the size of their holding, to participate in the capital raising at the same issue price as the Placement, and not incur any brokerage or transaction costs.
Eligible shareholders, being those holders of shares with an address in Australia, New Zealand or the United Kingdom as at
Eligible depositary interest holders, being those holders of depositary interests with an address in Australia, New Zealand or the United Kingdom as at
At this stage, the maximum gross amount raised under the SPP will be capped at a total of
The shares proposed to be issued under the SPP will be issued pursuant to the Company's placement capacity under Listing Rule 7.1.
Table 2: Indicative Timetable
Event |
Date |
Record date for Share Purchase Plan (SPP) |
Thursday, |
Announcement of Placement and SPP and suspension lifted |
Friday, |
Settlement of Tranche 1 Placement Shares |
Thursday, |
Allotment, quotation and trading of Tranche 1 Placement Shares |
Friday, |
SPP offer document and application forms made available to eligible shareholders, SPP letter made available to depositary interest holders SPP opening date |
Friday, |
Closing date for eligible depositary interest holders to participate in SPP |
Thursday, |
General Meeting to approve the issue of the Tranche 2 Placement Shares |
Friday, |
Closing date for eligible shareholders to participate in SPP |
Friday, |
Announcement of results of SPP |
Wednesday, |
Settlement of Tranche 2 Placement Shares |
Thursday, |
Allotment, quotation and trading of Tranche 2 Placement Shares |
Friday, |
Issue of SPP Shares |
Tuesday, |
Commencement of trading of SPP Shares |
Wednesday, |
The above dates are indicative only and are subject to change, subject to compliance with the ASX Listing Rules and Corporations Act.
In particular, the Company may close the SPP offer early, depending on demand. Accordingly, eligible shareholders who wish to participate are encouraged to apply as soon as possible after the offer opens.
Lake Way Project construction on schedule & budget
The Lake Way Project remains on schedule for first SOP production in
Key project workstreams continue to progress with engineering now 99% complete, plant and non-process infrastructure contract awards 99% committed, structural steel 65% complete and the APA gas pipeline now 25% complete.
In
Presentation
The Company has also released a presentation on ASX which is available for download at https://www.so4.com.au/company-presentations/
Voluntary Suspension on ASX
The voluntary suspension of the Company's shares on ASX was lifted prior to the opening of trade on
For further information please visit www.so4.com.au or contact:
Tony Swiericzuk / Richard Knights |
Salt Lake Potash Limited |
Tel: +61 8 6559 5800 |
Colin Aaronson / Seamus Fricker |
Grant Thornton UK LLP (Nominated Adviser) |
Tel: +44 (0) 20 7383 5100 |
Derrick Lee / Peter Lynch |
Cenkos Securities plc (Joint Broker) |
Tel: +44 (0) 131 220 6939 |
Rupert Fane / Ernest Bell |
Hannam & Partners (Joint Broker) |
Tel: +44 (0) 20 7907 8500 |
This announcement has been authorised for release by the Board of Directors.
Additional Disclosures
The information contained within this announcement is deemed to constitute inside information as stipulated under the Market Abuse Regulations (EU) No. 596/2014. Upon the publication of this announcement, this inside information is now considered to be in the public domain.
Key Risks
Refer to pages 25 to 29 (inclusive) of the Presentation released to ASX on
Selling Restrictions
This announcement is for information purposes only and shall not constitute an offer to sell or issue or the solicitation of an offer to buy, subscribe for or otherwise acquire any new shares of the Company in any jurisdiction in which any such offer or solicitation would be unlawful.
Refer to pages 30 to 32 (inclusive) of the Presentation released to ASX on
Forward Looking Statements
This announcement includes forward-looking statements. These forward-looking statements are based on the Company's expectations and beliefs concerning future events. Forward-looking statements are necessarily subject to risks, uncertainties and other factors, many of which are outside the control of the Company, which could cause actual results to differ materially from such statements. Although the Company believes that its forward-looking statements have reasonable grounds, can give no assurance that they will be achieved. They may be affected by a variety of variables and changes in underlying assumptions that are subject to risk factors associated with the nature of the Company's business (including those described in pages 25 to 29 (inclusive) of the Presentation released to ASX on
Not for release to US wire services or distribution in the United States
This announcement has been prepared for publication in Australia and may not be released to US wire services or distributed in the United States. This announcement does not constitute an offer to sell, or a solicitation of an offer to buy, securities in the United States or any other jurisdiction. Any securities described in this announcement have not been, and will not be, registered under the US Securities Act of 1933 and may not be offered or sold in the United States except in transactions exempt from, or not subject to, the registration requirements of the US Securities Act and applicable US state securities laws.
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