Challenger Energy Regulatory News (CEG)

NOT FOR PUBLICATION, DISTRIBUTION OR RELEASE DIRECTLY OR INDIRECTLY, IN WHOLE OR IN PART, IN OR INTO THE UNITED STATES, CANADA, AUSTRALIA, JAPAN, THE REPUBLIC OF SOUTH AFRICA, NEW ZEALAND OR IN ANY OTHER JURISDICTION IN WHICH OFFERS OR SALES WOULD BE PROHIBITED BY APPLICABLE LAW. THIS ANNOUNCEMENT IS NOT AN OFFER TO SELL OR A SOLICITATION TO BUY SECURITIES IN ANY JURISDICTION, INCLUDING THE UNITED STATES, CANADA, AUSTRALIA, JAPAN, THE REPUBLIC OF SOUTH AFRICA AND NEW ZEALAND. NEITHER THIS ANNOUNCEMENT NOR ANYTHING CONTAINED HEREIN SHALL FORM THE BASIS OF, OR BE RELIED UPON IN CONNECTION WITH, ANY OFFER OR COMMITMENT WHATSOEVER IN ANY JURISDICTION. 

THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION FOR THE PURPOSES OF ARTICLE 7 OF REGULATION 2014/596/EU, AS AMENDED BY THE MARKET ABUSE (AMENDMENT) (EU EXIT) REGULATIONS 2019. IN ADDITION, MARKET SOUNDINGS WERE TAKEN IN RESPECT OF THE MATTERS CONTAINED IN THIS ANNOUNCEMENT, WITH THE RESULT THAT CERTAIN PERSONS BECAME AWARE OF SUCH INSIDE INFORMATION. UPON THE PUBLICATION OF THIS ANNOUNCEMENT, THIS INSIDE INFORMATION IS NOW CONSIDERED TO BE IN THE PUBLIC DOMAIN AND SUCH PERSONS SHALL THEREFORE CEASE TO BE IN POSSESSION OF INSIDE INFORMATION.

FOR IMMEDIATE RELEASE.

31 January 2022

Challenger Energy Group PLC

("Challenger Energy" or the "Company")

Fundraising Update: Replacement of Open Offer with Broker Option 

On 26 January 2022, Challenger Energy (AIM: CEG), the Caribbean and Atlantic margin focused oil and gas company, with exploration, production, appraisal and development assets across the region, announced its intention (the "Fundraising Announcement") to undertake a fundraising of up to £6.0 million (the "Fundraising") by way of a £4.0 million firm and conditional placing, including a firm and conditional direct subscription, (the "Placing") of new ordinary shares of 0.02 pence each in the capital of the Company ("Ordinary Shares") to new institutional and other investors (the "Placing Shares") and an up to £2.0 million open offer of new Ordinary Shares (the "Open Offer Shares") to existing shareholders (the "Open Offer").

The Placing was conducted by way of an accelerated bookbuild ("Bookbuild"), and on 27 January 2022 (as amended on 28 January 2022) the Company announced that it had raised £5.0 million via the Placing as a result of excess demand through the firm placing and firm direct subscription (the "Firm Placing") of 691,401,490 Placing Shares (the "Firm Placing Shares") and a conditional placing and conditional direct subscription (the "Conditional Placing") of a further 4,327,698,510 Placing Shares (the "Conditional Placing Shares"), each of the Firm Placing and Conditional Placing being at a price of 0.10 pence per Ordinary Share (the "Placing Price"). The Company advised that admission of the Firm Placing shares was anticipated on or around 31 January 2022, and that a Notice of Extraordinary General Meeting and Open Offer Circular would be sent to shareholders by or on 4 February 2022, with an Extraordinary General Meeting of shareholders to be convened on or around 28 February 2022. 

The Open Offer component of the Fundraising was included as a means of enabling existing shareholders to participate in the Fundraising at the same price as new institutional and other investors participating in the Placing. Since completion of the Bookbuild, the Company has subsequently been advised that, in accordance with the Financial Services and Markets Act 2000, as amended, the Company would be required to issue a Prospectus in connection with the Open Offer. This is due to the aggregation of the £6.9 million (€8.0 million) open offer conducted by the Company in April 2021 and the proposed Open Offer component of the Fundraising. Accordingly, due to the expected time and cost of complying with the requirements of that process, the Company considers the Open Offer not to be in the best interests of its shareholders and will therefore no longer proceed with the Open Offer.

In substitution, and so as to remain true to the commercial intent of providing as many existing shareholders as possible with the same opportunity to participate in the Fundraising on the same basis as new institutional and other investors, the Company has entered into an amended and restated placing agreement with its broker, Arden Partners Plc ("Arden"), and placing agent, Gneiss Energy Limited ("Gneiss"), (the "Placing Agreement"), to facilitate Arden raising up to an additional £2.0 million for the Company at the Placing Price (the "Broker Option") or such increased amount as may be agreed among the Company, Arden and Gneiss. The Broker Option will serve to accommodate requests to participate in the Placing from existing shareholders who are qualifying investors, thus affording those shareholders the same opportunity as was intended by the Open Offer. Further details of the Broker Option, including details on how to participate in the Broker Option, are set out below. As with the funds to be raised pursuant to the Conditional Placing, the funds raised in the Broker Option are conditional, inter alia, on approval by the Company's shareholders at the Extraordinary General Meeting of the resolutions required to complete the Fundraising , which will now be convened on or around 4 March 2022.

A revised timetable of principal events is set out in Appendix I.

Broker Option

The Company has granted an option to Arden pursuant to the Placing Agreement in order to deal with demand in the event that requests to participate in the Placing from existing shareholders who are qualifying investors are received between the time following release of this announcement and 6:30 p.m. (London time) on Wednesday, 2 February 2022 (the "Broker Option Period"). To participate in the Broker Option, during the Broker Option Period, shareholders who are qualifying investors should communicate their interest to Arden via their independent financial adviser, stockbroker or other firm authorised by the Financial Conduct Authority (all of whom will be required to confirm to Arden that their client is an existing shareholder and a qualifying investor, being a Relevant Person as set out below under Important Notices), as Arden cannot take direct orders from individual private investors. Arden should be contacted by telephone on +44 (0) 20 7614 5900 or by email at simon.johnson@arden-partners.com. Subject to relevant anti-money laundering processes, where proposed participants cannot settle payment for Placing Shares through Arden, the Company may be able to facilitate direct settlement with the shareholder.

Any new Ordinary Shares issued pursuant to the exercise of the Broker Option ("Broker Option Shares") will be issued on the same terms and conditions as the Placing Shares and at the Placing Price. The Broker Option is conditional on the approval by the Company's shareholders at the Extraordinary General Meeting, which as noted will now be convened on or around 4 March 2022 

Arden may choose to accept bids and/or not to accept bids, either in whole or in part, on the basis of allocations determined at their discretion (after consultation with the Company) and may scale down any bids for this purpose on such basis as Arden may determine. In the event of excess demand, the Company reserves the right to increase the size of the Broker Option by agreement with Arden and Gneiss and subject to the requisite conditions being satisfied. A separate announcement will be made regarding the results of the Broker Option.

The Broker Option Shares are not being made available to the public, only to existing shareholders who are qualifying investors and who are on the register of members of the Company as at the close of the Broker Option Period, and none of the Broker Option Shares are being offered or sold in any jurisdiction where it would be unlawful to do so. No Prospectus will be issued in connection with the Broker Option. Qualifying investors shall mean for these purposes those shareholders who meet the definition of Relevant Person as set out below.

Subject to shareholder approval at the Extraordinary General Meeting, application will be made for the Broker Option Shares along with the Conditional Placing Shares to be admitted to trading on the AIM market of the London Stock Exchange plc ("AIM") ("Second Admission"). It is ‎expected that Second Admission will take place at 8:00 a.m. (London time) on or around 7 March 2022 (or ‎such later date as may be agreed between the Company, Arden and Gneiss). The Broker Option and Conditional Placing are conditional ‎upon, inter alia, shareholder approval, Second Admission becoming effective and the Placing Agreement not having been ‎terminated.

Further Director Participation in the Placing

As part of the Placing, Bizzell Capital Partners Pty Ltd, a firm controlled by Stephen Bizzell (non-executive director of the Company), subscribed for Ordinary Shares for an aggregate of £200,000. Of this amount, approximately £29,000 represents Ordinary Shares to be held beneficially on behalf of Stephen Bizzell, with the balance to be held on behalf of clients of Bizzell Capital Partners Pty Ltd. The subscription for new Ordinary Shares by Bizzell Capital Partners Pty Ltd is considered a related party transaction for the purposes of the AIM Rules for Companies. The directors of the Company who are considered independent (being William Schrader, James Smith and Simon Potter), having consulted with Strand Hanson Limited, the Company's Nominated Adviser, consider the terms of the subscription to be fair and reasonable insofar as the Company's shareholders are concerned.

Admission of the Firm Placing Shares

Admission of the Firm Placing shares will now occur at 8:00 a.m. on or around Tuesday, 1 February 2022.

Several of the Company's significant creditors have also agreed to deferral of the payment date for final creditor settlements from 31 January 2022 to 17 March 2022, therefore admission of the Firm Placing Shares on 1 February 2022 (as opposed to on 31 January 2022) will not have any material impact on the Company's cash position or immediate funding requirements.

All other information set out in the Fundraising Announcement of 26 January 2022 and the subsequent results announcement of 27 January 2022 (as amended on 28 January 2022) remains current and unchanged. All terms defined in the Fundraising Announcement of 26 January 2022 have the same meaning in this announcement unless otherwise noted.

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This announcement should be read in its entirety. In particular, you should read and understand the ‎information provided in the "Important Notices" section of this announcement.‎

For further information, please contact:

Notes to Editors

Challenger Energy is a Caribbean and Atlantic margin focused oil and gas company, with a range of production, development, appraisal and exploration assets and licences, located onshore in Trinidad and Tobago, and Suriname, and offshore in the waters of The Bahamas and Uruguay. In Trinidad and Tobago, Challenger Energy has five (5) producing fields, two (2) appraisal / development projects and a prospective exploration portfolio in the South West Peninsula. In Suriname, Challenger Energy has on onshore appraisal / development project.

Challenger Energy is quoted on the AIM market of the London Stock Exchange. 

https://www.cegplc.com 

This announcement contains inside information for the purposes of Article 7 of EU Regulation 596/2014 as amended by the Market Abuse (Amendment) (EU Exit) Regulations 2019 ("MAR").

IMPORTANT NOTICES

Neither the contents of the Company's website nor the contents of any website accessible from hyperlinks on the Company's website (or any other website) is incorporated into, or forms part of, this announcement.

This announcement does not constitute, or form part of, a prospectus relating to the Company, nor does it constitute or contain any invitation or offer to any person, or any public offer, to subscribe for, purchase or otherwise acquire any shares in the Company or advise persons to do so in any jurisdiction, nor shall it, or any part of it form the basis of or be relied on in connection with any contract or as an inducement to enter into any contract or commitment with the Company.

In any EEA Member State that has implemented the Prospectus Regulation (EU) 2017/1129 (the ‎‎"Prospectus Regulation"), as amended, and the United Kingdom (together with any implementing ‎measures in any Member State and the United Kingdom), this announcement is only addressed to and ‎directed at persons in such member states and the United Kingdom who are qualified investors within the ‎meaning of Article 2(e) of the Prospectus Regulation as it forms part of UK domestic law by virtue of the European Union (Withdrawal) Act 2018 ("Qualified Investors"). In addition, in the United ‎Kingdom, this announcement is addressed and directed only at Qualified Investors who (i) are persons ‎who have professional experience in matters relating to investments falling within Article 19(5) of the ‎Financial Services and Markets Act 2000 (Financial Promotion) Order 2005, as amended (the "Order"), (ii) ‎are persons who are high net worth entities falling within Article 49(2)(a) to (d) of the Order, or (iii) are ‎persons to whom it may otherwise be lawful to communicate it to (all such persons being referred to as ‎‎"Relevant Persons"). Any investment or investment activity to which this announcement relates is ‎available only to Relevant Persons in the United Kingdom and Qualified Investors in any member state of ‎the EEA and will be engaged in only with such persons. Other persons should not rely or act upon this ‎announcement or any of its contents.‎

This announcement is not being distributed by, nor has it been approved for the purposes of section 21 ‎of the Financial Services and Markets Act 2000, as amended ("FSMA") by Arden, Gneiss or any ‎person authorised under FSMA. This announcement is being distributed and communicated to persons in ‎the United Kingdom only in circumstances in which section 21(1) of FSMA does not apply or ‎otherwise falls within a relevant exemption. No prospectus will be made available in connection with the ‎matters contained in this announcement and no such prospectus is required (in accordance with the ‎Prospectus Regulation) to be published. Persons needing advice should consult an independent ‎financial adviser.

‎This announcement is not for publication or distribution, directly or indirectly, in or into the United States of America. This announcement is not an offer of securities for sale into the United States. The securities referred to herein have not been and will not be registered under the U.S. Securities Act of 1933, as amended (the "Securities Act"), and may not be offered or sold in the United States, except pursuant to an applicable exemption from registration. No public offering of securities is being made in the United States. This announcement is not for release, publication or distribution, directly or indirectly, in or into the United States, Australia, Canada, the Republic of South Africa, Japan or any jurisdiction where to do so might constitute a violation of local securities laws or regulations (a "Prohibited Jurisdiction"). This announcement and the information contained herein are not for release, publication or distribution, directly or indirectly, to persons in a Prohibited Jurisdiction unless permitted pursuant to an exemption under the relevant local law or regulation in any such jurisdiction. This announcement has been issued by and is the sole responsibility of the Company.

Arden Partners Plc ("Arden" or the "Bookrunner"), which is authorised and regulated in the United Kingdom by the Financial Conduct Authority (the "FCA"), is acting solely as bookrunner ("Bookrunner") exclusively for the Company and no one else in connection with the Placing and Broker Option and will not regard any other person (whether or not a recipient of this announcement) as its client in relation to the Placing and Broker Option nor will it be responsible to anyone other than the Company for providing the protections afforded to its clients or for providing advice in relation to the Placing and Broker Option. Apart from the responsibilities and liabilities, if any, which may be imposed on Arden by FSMA or the regulatory regime established thereunder, Arden accept no responsibility whatsoever, and makes no representation or warranty, express or implied, for the contents of this announcement including its accuracy, completeness or verification or for any other statement made or purported to be made by it, or on behalf of it, the Company or any other person, in connection with the Company and the contents of this announcement, whether as to the past or the future. Arden accordingly disclaims all and any liability whatsoever, whether arising in tort, contract or otherwise (save as referred to above), which it might otherwise have in respect of the contents of this announcement or any such statement.

Gneiss Energy Limited ("Gneiss" or the "Placing Agent"), which is an appointed representative of Talbot Capital Limited, which is authorised and regulated in the United Kingdom by the FCA, is acting exclusively for the Company and no-one else in connection with the Placing and Broker Option or in relation to the matters described in this document and is not taking responsibility for the commercial assessment of the Placing and Broker Option, which remains the sole responsibility of the Board, and will not be responsible to any person other than the Company for providing the protections afforded to the clients of Gneiss nor for providing advice to any other person in relation to the Placing or any other matter referred to in this document. Gneiss accept no responsibility whatsoever, and makes no representation or warranty, express or implied, for the contents of this announcement including its accuracy, completeness or verification or for any other statement made or purported to be made by it, or on behalf of it, the Company or any other person, in connection with the Company and the contents of this announcement, whether as to the past or the future. Gneiss accordingly disclaims to the fullest extent possible all and any liability whatsoever, whether arising in tort, contract or otherwise, which it might otherwise have in respect of the contents of this announcement or any such statement.

Strand Hanson Limited, which is authorised and regulated in the United Kingdom by the FCA, is acting as Nominated Adviser to the Company for the purposes of the AIM Rules for Companies and the AIM Rules for Nominated Advisers in connection with the Placing and Broker Option and is not acting for, and will not be responsible to, any person other than the Company for providing the protections afforded to customers of Strand Hanson Limited or for advising any other person on any transaction or arrangement referred to in this Announcement.

This announcement contains inside information for the purposes of Article 7 of EU Regulation 596/2014 as amended by the Market Abuse (Amendment) (EU Exit) Regulations 2019 ("MAR"). Upon publication of this announcement, the inside information is now considered to be in the ‎public domain for the purposes of MAR. The person responsible for arranging release of this information ‎on behalf of the Company is the Company Secretary, Benjamin Proffitt.‎

FORWARD LOOKING STATEMENTS

This announcement includes "forward-looking statements" which include all statements other than statements of historical facts, including, without limitation, those regarding the Company's business strategy, plans and objectives of management for future operations, or any statements proceeded by, followed by or that include the words "targets", "believes", "expects", "aims", "intends", "will", "may", "anticipates", "would", "could" or similar expressions or negatives thereof. Such forward-looking statements involve known and unknown risks, uncertainties and other important factors beyond the Company's control that could cause the actual results, performance or achievements of the Company to be materially different from future results, performance or achievements expressed or implied by such forward-looking statements. Such forward-looking statements are based on numerous assumptions regarding the Company's present and future business strategies and the environment in which the Company will operate in the future. These forward-looking statements speak only as at the date of this announcement. The Company expressly disclaims any obligation or undertaking to disseminate any updates or revisions to any forward-looking statements contained herein to reflect any change in the Company's expectations with regard thereto or any change in events, conditions or circumstances on which any such statements are based, unless required to do so by applicable law or the AIM Rules.

APPENDIX I

EXPECTED TIMETABLE OF PRINCIPAL EVENTS

Announcement of the Placing 4:54 p.m. on 26 January 2022

Announcement of results of the Placing 7:53 a.m. on 27 January 2022

Commencement of Broker Option Period 7:00 a.m. on 31 January 2022

First Admission and dealings in the Firm Placing Shares expected 8:00 a.m. on 1 February 2022to commence on AIM

Where applicable, expected date for CREST accounts to be As soon as practicable aftercredited in respect of Firm Placing Shares in uncertificated form 8:00 a.m. on 1 February 2022

Close of Broker Option Period 6:30 p.m. on 2 February 2022

Announcement of results of the Broker Option 7:00 a.m. on 3 February 2022

Share certificates dispatched for Firm Placing Shares in certificated form By 8 February 2022

Publication and posting of the Notice of Extraordinary General Meeting 9 February 2022and Proxy Form

Latest time and date for filing of proxies for the 11:00 a.m. on 2 March 2022Extraordinary General Meeting

Extraordinary General Meeting 11:00 a.m. on 4 March 2022

Announcement of the result of the Extraordinary General Meeting 4 March 2022

Second Admission and dealings in the Conditional Placing Shares 8:00 a.m. on 7 March 2022and the Broker Option Shares expected to commence on AIM

Where applicable, expected date for CREST accounts to be As soon as practicable aftercredited in respect of Conditional Placing Shares and 8:00 a.m. on 7 March 2022Broker Option Shares in uncertificated form

Share certificates dispatched for Conditional Placing Shares By 14 March 2022and Broker Option Shares in certificated form

Notes:

(1) All of the above times refer to London time unless otherwise stated. The dates set out in the Expected Timetable of Principal Events above and mentioned throughout this announcement may be adjusted by the Company, in which event details of the new dates will be notified by means of an announcement through a Regulatory Information Service and, where appropriate, to Shareholders.

(2) Completion of all events in the above timetable following the holding of the Extraordinary General Meeting are conditional upon, inter alia, the passing of the Resolutions at the Extraordinary General Meeting.

(3) Different deadlines and procedures for return of forms may apply in certain cases.