15 Sep 2010 07:00
| Immediate Release | 15 September 2010 |
GLOBAL ENERGY DEVELOPMENT PLC
(the 'Company')
LOAN AGREEMENT
Global Energy Development PLC, the Latin America focused petroleum exploration and production company (LSE-AIM: "GED"), announces that on 14 September 2010 it agreed a senior secured note with HKN, Inc. for a principal amount of US$5 million (the "Loan Agreement").
The Loan Agreement allows for the full principal amount to be available to the Company with immediate effect, and the Company intends to use it to provide supplementary funds, in addition to operating cash flow, with which to continue executing its previously announced Three Year Plan. The Loan Agreement provides for an interest charge of 10% per annum, payable monthly in arrears, with the principal amount being repayable in full by 14 September 2011. The loan principal and interest will be secured against a proportion of the production from the Company's Rio Verde contract and the Company will pay to HKN Inc. a transaction fee of approximately US$60,000.
By virtue of HKN, Inc.'s 33.56% holding in the Company, the Loan Agreement constitutes a related party transaction under the AIM Rules for Companies. With the exception of Mr. Mikel Faulkner, who is a director of HKN, Inc., the Company's Directors consider, having consulted with Matrix Corporate Capital LLP, the Company's Nominated Adviser, that the terms of the transaction are fair and reasonable insofar as the Company's shareholders are concerned.
For further information:
Global Energy Development PLC
| Catherine Miles, Company Secretary | +44 (0)20 3178 5156 |
| www.globalenergyplc.com | +44 (0)7909918034 |
Matrix Corporate Capital LLP
| Louis Castro Tim Graham | +44 (0)20 3206 7000 |