Ascent Resources Regulatory News (AST)

Ascent Resources plc / Epic: AST / Index: AIM / Sector: Oil and Gas

20 September 2019

Ascent Resources plc

("Ascent" or "the Company")

Completion of £1 million Subscription

Ascent Resources plc (AIM: AST), the independent oil and gas exploration and production company, operating in the Petišovci Gas Project in Slovenia, is pleased to announce that it has entered into a subscription agreement for £1,080,500 before costs, with RiverFort Global Opportunities PCC Limited ("The Investor"), through a subscription for 393,000,000 shares at 0.275 pence per ordinary share ("The Subscription"), a premium of 10% to the closing bid price on 19 September 2019.

John Buggenhagen, CEO of Ascent, commented: 

"We are pleased to be working with RiverFort Capital to complete this placing including their ongoing investment in Ascent's new strategy. It offers us the capital to take the Company forward and begin to execute our plan to grow the companies reserve and production base in Slovenia while we find new opportunities in the region and diversity our assets. This is the next step in reinventing Ascent and is necessary to move forward towards new producing wells while continuing to focus on capturing the significant value that the Company and its partners have already created at Petišovci."

Summary of financing

The Company has entered into three agreements with the Investor, being the Subscription for 393,000,000 ordinary shares, an equity sharing agreement and a one-year Investment agreement such that it will receive US$500,000 (£420,000) on closing and the balance will be received over the next twelve months. The amount ultimately received by the Company will be related to its share price performance so that the Company will receive more should the share price improve but will receive less should the share price not increase.

As part of the arrangements, the Company will also issue 43,000,000 Warrants to the Investor at a future date, following the grant of approval from shareholders. The exercise price of the warrants will be the lower of 120 percent of the share price on the closing date or the price of any subsequent equity issue by the Company in the 18-month period post-closing.

The Investor is managed by a London based UK Institutional Investment Manager RiverFort Global Capital Ltd ("RiverFort"). RiverFort provides comprehensive and innovative growth funding solutions to publicly listed and private companies across a range of sectors.

The three main agreements which govern the Investment outlined above are:

·; A Subscription Agreement under which the Investor subscribes for 393,000,000 shares at 0.275 pence per ordinary share for £1,080,750.

·; An Equity Sharing agreement under which Ascent pay the Investor £1,080,750 in return for payments over twelve months, equivalent to one twelfth of the subscription shares each month at the subscription price plus a premium of 10% ("Benchmark Price"), and this amount is then adjusted for the actual performance of the share price in the period. Where the average share price in any given month is above the Benchmark Price the Company will receive in addition to the standard monthly payment a payment equal to 50% of the price above the benchmark limit multiplied by the monthly subscription shares and should the share price be below the Benchmark Price the monthly payment will be reduced by the an amount equivalent to the deficit in the share price multiplied by the monthly subscription share number. Irrespective of the mechanics of the Equity Sharing agreement in relation to the amount received by the Company the total number of shares issued under the Subscription Agreement is fixed at 393,000,000.

·; An Investment Agreement under which the Investor has provided a loan to the company of US$500,000 (£420,000) repayable on or before the 19 September 2020 along with accrued interest at 10% per annum. A further US$500,000 is available to be drawn at mutual agreement of the Company and the Investor during the next 12 months.

·; The agreements provide that under certain events of default the Investor can accelerate any remaining settlement period outstanding.

·; There are selling restrictions and volume limits on any share sales by the Investor and they are contractually precluded from short selling the Company's Ordinary Shares.

Total Voting Rights

Following the issue of the New Ordinary Shares, the Company will have 3,019,648,452 ordinary shares of 0.2p each in issue. No Ordinary Shares are held in treasury. The figure of 3,019,648,452may be used by the Company's shareholders 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 Financial Conduct Authority's Disclosure Rules and Transparency Rules.

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