RE: RNS7 Jan 2021 07:12
Funding Update: With drilling of Perseverance #1 having now been underway for almost 3 weeks, and with clarity as to the ability to continue drilling without interruption received from the Court in The Bahamas (refer to BPC's announcement of 6 January 2021), the Company is now refocussed on bringing to a close the final elements of its previously advised corporate funding strategy, with 2 principal aims: (i) ensuring the Company has on an ongoing basis adequate liquid cash resources to meet ongoing costs; and (ii) ensuring the Company has access to additional funding resources should they be needed to meet contingencies and other costs arising as drilling proceeds, but ideally without the Company being required to draw on those funding sources until and unless needed.
Consistent with this strategy, the Company has progressed two elements of its funding package, as follows:
(i) The Company has drawn-down the first £3 million of its conditional fixed-conversion price senior secured convertible loan notes financing facility ("Notes"), under which up to £15 million (approximately US$20 million) is available for draw-down, subject to satisfaction of conditions precedent. Drawdown of the first £3 million was subject to spud of Perseverance #1 by 28 December 2020, with the drawdown of the balance in accordance with a timing schedule matched to the Perseverance #1 drilling program, and subject to satisfaction of certain conditions precedent by the time of drawdown.
(ii) The Company has secured a variation to the agreements entered into on 14 December 2020 with an institutional investment fund managed by Lombard Odier Asset Management (the "Investor"), which were specifically designed to replace a variable-conversion price convertible note facility with a Bahamian family office investor. Under a Funding Agreement, BPC placed a fixed number of shares to the Investor to secure £7.5 million (US$10 million), and under a Funding Option Agreement, BPC was granted an option, exercisable within 10 business days after the spud of the Perseverance #1 well (being 6 January 2021), to place a further fixed number of shares to the Investor to raise up to an additional £3.75 million (US$5 million) (the "Put"). If BPC exercises the Put, the Investor has the option to double the amount the subject of the Put, on the same terms and conditions (the "Call"). BPC and the Investor have now agreed that: (i) the last date by which BPC may exercise the Put is extended to 13 January 2021, but if the Company chooses not to exercise the option the Put will simply lapse - this extension preserving funding optionality for BPC as drilling progresses, consistent with the overall funding strategy; (ii) subject to BPC exercising the Put, the Call must be exercised before the earlier of (a) the date of BPC's RNS announcement of the Perseverance #1 well results and (b) 12 February 2021, failing which, the Call will lapse; and (iii) in respect of any shares i
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