They didn't announce an extension at the end of September 2023. It was only when they announced that the GSA had to be renegotiated on October 25th that they announced the extension of the funding deadline.
They only need to RNS anything that has the potential to cause a major change to the share price. If negotiations are still ongoing and there is no question of the deal being pulled or materially being altered there is no need to report this. This was the situation with the first extension which wasn't reported until the RNS you posted which confirmed changes to the GSA were required to meet funders requirements.
What bank funding deadline?
If the end is nigh why didnât the bond holders demand their money now?
They are a lot closer to the potential fortunes of the company than you are.
I have a life beyond this bulletin board!
1. His original share purchase wouldn't have been in an RNS because he was a Director. He bought over 1m additional shares in August 2020. This is evidenced in an RNS.
2. I can tell you from personal experience that share purchase/option schemes are not free money. I had to make a difficult choice to give up a large ( compared to my modest salary ) share option to pursue a different employment opportunity. The considerations were both financial and emotional because it was a significant amount of money to be giving up for what might have been an unsuccessful career move.
Neither you nor I can say how "invested" GL is in Sound compared to shareholders but in my view, the fact that he has a significant shareholding means that he has a huge incentive to make a success of Sound Energy.
No you donât get it. If you get shares or share options as part of a remuneration package then you have a financial incentive to work towards increasing the value of those shares for your own benefit. That is the reason companies operate employee share schemes . In addition to the shares and options granted under his remuneration package, GL had large shareholding in Sound before he joined the board . Everyone knows that.
No skin in the game other than the millions of shares they own. But they obviously don't count.
Graham has over 2m shares and Mohammed over 11m. In addition they have over 12m nil cost options between them so have a big incentive to start generating revenue and increasing the share price.
Where did you get those figures from? If you are looking at the Annual Report then all the remuneration other than salary was taken either a shares or options so rather than fleecing shareholders they are supporting them by not taking contractually payable bonuses in cash but as shares/options reflecting their faith in the future of the company.
Only the broker reports in 2023 have had a 12 month share price target so we are still a long way off seeing whether these 12 month targets will be accurate.
I was replying to PS saying 4.6p is years away. I agree 1.4p is mega cheap and that 5p is a realistic target once Phase 2 gets underway or Sound get somewhere with further exploration.
You keep saying that but in reality the 4.6p valuation is a short term target (12 months) based on a risked NAV based on forecasted cash flows from the TE5 Horst only plus a small amount for TE4 exploration. Once the risk factors are resolved then the target price should rise accordingly. The valuation includes nothing for further exploration of Greater Tendrara or of Anoual or Sidi. Once the historic funding arrangements are finalised by a FID then we will hopefully see more interest in the share. This could also come from the drilling of TE4 or farm outs of Anoual or Sidi. There is so much to look forward to once the future funding is finalised. 3-5p should then be within sight.
How can you be so naive. Sound havenât âgiven awayâ 53% of Tendrara for $8m. Cavalley are funding up to $16.4m of Phase 1 costs which includes $8m that will be paid back to Sound for the money they have already spent. In addition to that they will fund $48m in equity for Phase 2 including all of Soundâs 35% portion worth $22.4m. In addition they will fund the drilling and testing of TE4 up to a value of $7m giving Sound a carry of up to $3.3m.
They will then fund 40% of the bank loan for the Phase 2 project and 40% of all the ongoing operating expenses for Phase 1 and Phase 2 plus 40% of any future exploration and development at Tendrara.
Overall the 53% âgive awayâ is worth several hundreds of millions of dollars over a 10 year period.
You are right that investors will have to be patient because of the slow pace of development of the resource. You say look at the S.P. Angel report for the numbers in black and white but this valuation is fairly conservative given the early stage that the field development is at.Even on this conservative basis, they give a 12 month price target of 4.6p with potential for increases on this as the project is derisked. On this basis your 2.5p projection in 2 years looks very pessimistic.
The 7.3p share price target is now given as a 12 month target. Hopefully we will see some significant rises once the funding is signed off.
The financing is subject to agreement. There is nothing to prevent agreement to some of the financing being made available immediately to cover G and A costs until first gas. Alternatively, once this funding agreement is in place this will hopefully allow the Farm Out or alternative project financing to be concluded providing G and A funding until next year.
Thanks Jobbinscl. As you would expect management is on top of this issue and have plans in place to deal with any eventuality. If management are in Morocco, hopefully this is to finalise details of the pipeline funding which GL says is on the cusp of being completed.
Hopefully, the LTC will decide that the majority of the SARL claim is invalid as they did with the SEME one and SOU will left appealing to the higher courts over fairly small amounts. In any event, if we get Phase 2 up and running any claims upheld will be manageable without major impact on our operations. If claims are upheld, then we may have an action against the lawyers/tax experts who advised SARL and SEME originally.
The situation is explained in Note 8 of the Financial Statements in the 2021 Annual Report.
The figure of $14m relates to a claim against SEME brought in August 2020. This related to two matters. One related to licensing matters on the Tendrara exploration permits. The second matter relates to the transfer of operator from SARL to SEME. In August 2021, the tax authority dropped the larger part of the claim relating to transfer of intangible assets but not a smaller assessment relating an asset transfer from SEME to Schlumberger. This claim for $2.5m is the one that has recently been upheld.
The claim of $22.2m plus $0.3m penalty charge is a claim against SARL relating to the change in the licensing and ownership arrangement. This is currently under appeal at the local tax committee.