Member Info for PageofCups

The reason for the drop is a flush out of sellers. There is a huge gas crunch coming this winter in Europe. New supplies of LNG are urgently needed and the price will only keep sky rocketing. Concerns of a recession won't affect gas prices because everybody needs gas, recession or no recession. The supply is tight and things are only going to get worse until they sort out the supply issue.

Bargain now... £15m Mcap... Where's Mr Calgary? He was hoovering up shares at 5.5p...

SCIR will only receive $9.75m from the $16m as they have to pay back the loan.

Under your interpretation, the total consideration SCIR will be receiving is $22.25m ($16m plus costs $6.25m which SCIR invest in the asset). I agree SCIR should be receiving this if WEN are paying costs from 1st January 2022. But SCIR will not receive a total of $22.25m. They will only receive a maximum of $16m and will owe $6.25m.

mrc, The reason it doesn't explicitly say costs are paid is because costs are not paid.
Total consideration of the divestment is up to $16m. No more. Costs come out of that $16m which is the $6.25m loan WEN are making to SCIR. It is WEN's money so under the terms of the Facility they are entitled to have it paid back plus interest. WEN are not giving SCIR $6.25m in addition to the $16m. You shouldn't imply anything unless it's written down.

In the case the deal does not complete and SCIR cannot pay the loan, WEN walk off with the Ruvuma asset

You do understand that SCIR must pay back $6.25m plus 7% interest p.a. on $3.25m. This repayment either is paid in cash, shares, or from the overall consideration of $16m.

mrc if that was the case, then SCIR should be paid, $16m + $6.25m. But this is not the case.

The key word is 'reduction'

Additionally, WEN will have security over the Ruvuma asset. So if the loan is not repaid or costs spiral out of control on the well then WEN get the asset if the loan is not repaid. The conversion into Scirocco shares for all or part of the Facility is not really applicable at Scirocco's current sp, so when WEN can just take over the asset instead. SCIR are taking all the risk, yet you've been led to believe the deal mitigates risk.

mrc, WEN are not responsible for costs from the effective date. The $6.25m loan is repayable on completion by way of corresponding reduction to the consideration payable under the Asset Purchase Agreement. See the RNS of 13th June.

"Subject to Completion occurring, the Facility is repayable by Scirocco upon Completion by way of a corresponding reduction to the consideration payable under the Asset Purchase Agreement. If Completion does not occur, the Facility will be repayable on the date falling 90 days after Wentworth has demanded repayment following termination of the Asset Purchase Agreement (the "Repayment Date"). If the Facility is not repaid by the Repayment Date, Wentworth may convert all or part of the Facility into fully paid Ordinary Shares, subject to applicable laws and regulations".

The loan is secured against the Ruvuma asset. So if the well has problems or costs go up and Sirocco can't pay, WEN get the asset anyway..Lol

You've got to ask, why are the Board releasing RNS's at 5pm, 6pm and 6:31pm?
Why did they have the GM in Scotland? Join the dots.

mrc, nope haven't seen that WEN will be responsible for costs. If the deal completes SCIR still need to pay back the $6.25m facility. If they don't then WEN can be issued with shares as per this evening RNS, even if the deal completes. Alternatively the loan will be deducted from the final consideration if the deal completes. So, clearly WEN are not paying for costs from 1st January 2022 if they are deducting monies from the final payment of the deal.

Oh it gets worse. The Facility is a loan for $6.25m. The first $3m is interest free, but you still got to pay back $3m and the second $3.25m has an interest of 7% pa. So in effect the initial $3m consideration WEN pay will cover the first half of the loan. So you will still need to pay back $3.25m plus interest.. where are you going to get that money from if milestones in the deal are not successful? SCIR will end up having to pay money rather than receiving any if it goes wrong. Never heard of an asset being sold where the seller pays the buyer, which is what is going on here. It's all fake. $16m???

There is one question you can ask the BoD. What happens if the drill is not successful?
I bet you will have to pay back the initial $3m consideration to cover the loan plus interest. That's if the BoD haven't already spent it.

If the milestones of the deal are not met, ie the drilling is not successful, then SCIR shareholders are still taking all the risk of drilling even though they have supposedly divested the asset which the BoD have said is high risk and the company can ill afford to take.

To top it all, if SCIR can't pay the loan, which they won't be able to because they won't have any money, then WEN get to dilute the hell out of you.

You guys have been mislead by the Board. You need to take legal action.

Why on Earth would the BoD even agree to a take a loan from WEN and have to pay it back when the asset will effectively be owned by WEN once the deal completes. The money to be paid upfront for the seismic and drill, should be at WEN's cost not SCIR's. The effective date is 1st January 2022. Therefore WEN should be responsible for all costs of the seismic and drilling. SCIR are still paying for the development costs on behalf of WEN, whether by a loan or the balance being deducted from the final consideration once the deal completes. Outrageous and poorly executed deal.

Having to pay upfront costs by way of the loan makes the below statement in the announcement of 13the June a joke.

"If the Proposed Transaction completes, Scirocco will no longer be exposed to the costs (or the potential upside) associated with the Ruvuma Asset".

Dear Board. The market is waiting..it shouldn't be a problem with the asset to find a farmout partner or finance..let's be having it.