Challenger Energy Regulatory News (CEG)

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. UPON THE PUBLICATION OF THIS ANNOUNCEMENT, THIS INSIDE INFORMATION IS NOW CONSIDERED TO BE IN THE PUBLIC DOMAIN.

FOR IMMEDIATE RELEASE.

3 February 2022

Challenger Energy Group PLC

("Challenger Energy" or the "Company")

Result of Broker Option

Challenger Energy (AIM: CEG), the Caribbean and Atlantic margin focused oil and gas company, with exploration, production, appraisal and development assets across the region, is pleased to announce the result of the Broker Option that was launched on 31 January 2022 and which closed yesterday. The Broker Option was implemented to allow the Company's existing shareholders who are qualifying investors to participate in the Fundraising on the same terms as the Conditional Placing.

The Company received applications from existing shareholders who are qualifying investors under the Broker Option for 2,273,517,925 new ordinary shares of 0.02 pence each in the capital of the Company ("Ordinary Shares"). Given the intent of the Broker Option, the Company's broker, Arden Partners Plc ("Arden"), will facilitate the Broker Option in accordance with its obligations pursuant to the Placing Agreement and all applications received from existing shareholders who are qualifying investors will be accommodated, such that the Broker Option will raise an additional approximately £2.3 million.

The Company has therefore conditionally raised total gross proceeds of approximately £7.3 million: approximately £5.0 million raised via the Placing and approximately £2.3 million raised via the Broker Option. The Company raised approximately £0.7 million gross proceeds pursuant to the Firm Placing (under which approximately 691 million new Ordinary Shares were issued on 1 February 2022), and approximately £6.6 million gross proceeds (comprising the aggregate gross proceeds of the Conditional Placing and Broker Option) are conditional on approval by shareholders at an Extraordinary General Meeting which will be convened on or around 4 March 2022. A Notice of Extraordinary General Meeting will be sent to shareholders by or on 9 February 2022.

The 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, being 0.10 pence per Ordinary Share.

Application will be made for the Broker Option Shares and the Conditional Placing Shares to be admitted to trading on the AIM market of the London Stock Exchange plc ("AIM") ("Second Admission"). Second Admission is conditional on receiving shareholder approval at the Extraordinary General Meeting. 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 at the Extraordinary General Meeting, Second Admission becoming effective and the Placing Agreement not having been ‎terminated.

Eytan Uliel, CEO of Challenger Energy, said:

"The Broker Option - being the final component of our overall current fundraising programme - received strong support from existing shareholders. We have thus worked with our broker and financial adviser to ensure that all demand from existing shareholders will be met, and I am pleased to advise that the Broker Option will raise £2.3 million, through the issue of shares to those existing shareholders who applied, at the same price as that paid by new institutional and other investors in the Placing. A shareholder meeting to approve the conditional elements of the fundraising will now be convened for early March, and assuming approval, will mark the conclusion of the Company's restructuring and recapitalisation process which began in October of last year. Through this process we will have successfully cleaned-up and strengthened the balance sheet, refocused the business, its strategy, Board and management, and placed this Company in a position where it can begin to chart a new course for the future, on a firm financial footing. It has not been an easy road to get here, and I would especially wish to thank all shareholders - existing and new - for their patience and support. The entire Challenger Energy team is now focused on the core tasks ahead: to build production, to build cash flow, and to restore shareholder value."

Director Participation in the Broker Option

As part of the Broker Option, Eytan Uliel, the Company's Chief Executive Officer and director, will subscribe for 20,000,000 Ordinary Shares for an aggregate subscription amount of £20,000 (in addition to the £150,000 of Ordinary Shares subscribed for by Eytan Uliel in the Placing). The subscription for new Ordinary Shares by Eytan Uliel 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.

Total Voting Rights

Following admission to trading on AIM of the Firm Placing Shares, the Company's issued share capital consists of 1,487,924,404 Ordinary Shares, with each Ordinary Share carrying the right to one vote. The Company does not hold any Ordinary Shares in treasury. This figure of 1,487,924,404 Ordinary Shares may therefore be used by shareholders in the Company, as the denominator for the calculations by which they will determine if they are required to notify their interest in, or a change in their interest in, the share capital of the Company under the FCA's Disclosure Guidance and Transparency Rules.

All other information set out in the Fundraising announcement of 26 January 2022, the results announcement of 27 January 2022 (as amended on 28 January 2022), and the Fundraising update announcement of 31 January 2022 remains current and unchanged. All terms defined in such announcements have the same meaning in this announcement unless otherwise noted.

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 Southwest 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").