LONDON (Alliance News) - Frontier Resources International PLC Monday said it will terminate its equity swap deal with YA Global Master SPV Ltd after accelerating the payments due under the swap by finding subscribers for all the swap shares held by YA Global.
Under the equity swap deal the parties signed last June, YA Global agreed to make 15 monthly settlement payments of GBP33,333 each to Frontier, subject to adjustment to reflect the price of the equity swap shares sold by YA Global at each occasion. It had initially subscribed for 8.3 million Frontier shares under the deal.
However, Frontier also kept a right to accelerate the funds raised under the agreement by finding investors to by up the equity swap shares from YA Global.
"The company has exercised this right today as the directors believe that given the next stage in the company's development, it would be in the company's best interests to accelerate and terminate the equity swap agreement now," the company said in a statement.
"On completion of the YA Global Placing, YA Global will make a single final payment to the Company and the equity swap agreement will then terminate. The funds will be used by the Company to provide additional funding for the Group's exploration activities," the company said.
Frontier shares were down 37.5% at 2.61 pence Monday morning.
By Steve McGrath; stevemcgrath@alliancenews.com; @SteveMcGrath1
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