Pilot Energy - Cornerstone Investment - Completion of Tranche 1

Pilot Energy - Cornerstone Investment - Completion of Tranche 1

Oil and gas exploration and development company Pilot Energy (ASX:PGY) has completed the first tranche of a two-tranche share placement to raise $3.6 million through a group of foreign investors. Pilot issued 400 million fully paid ordinary shares to the investors, raising $800,000 before costs. The second tranche, which will see the issue of 933,340,000 shares to raise a further $2.8 million, is due to be voted on by shareholders at a general meeting expected to be held in mid-May.


Highlights

  • Pilot Energy completes Tranche 1 of cornerstone investment, raising $800,000
  • Tranche 2 to raise a further A$2.6 million at 0.3 cents per share
  • Tranche 2 scheduled for completion mid-June 2016

As announced on 31 March 2016, Pilot Energy Ltd (Pilot Energy, or the Company, ASX:PGY) entered into a Share Subscription Agreement (SSA) with a group of investors (Subscribers) to raise A$3,600,020 in two tranches. The Company is pleased to announce that it has now completed Tranche 1 of this cornerstone investment and issued 400,000,000 fully paid ordinary shares in the Company (Shares) to the Subscribers, raising A$800,000 before costs (Tranche 1 Placement).

The issue of Shares under the Tranche 1 Placement was made pursuant to Section 708 of the Corporations Act 2001 (Cth) (Corporations Act) and Rule 7.1 (240,000,000 Shares) and Rule 7.1(A) (160,000,000 Shares) of the ASX Listing Rules.

Tranche 2 Placement

As previously announced, the SSA provides that the Subscribers will invest a further A$2,800,020 to acquire additional new Shares at 0.3 cents per Share; subject to the satisfaction of certain conditions precedent, including shareholder approval (Tranche 2 Placement). The Company is currently preparing shareholder meeting materials (including an Independent Expert’s Report) in order to seek shareholder approval. It is anticipated that a Notice of Meeting will be dispatched to shareholders in mid-May 2016 for a general meeting to take place in mid-June 2016. The Company looks forward to providing updates regarding the cornerstone investment as the transaction progresses towards completion.

Disclosure under ASX Listing Rules 7.1A.4(b) and 3.10.5A

In accordance with ASX Listing Rules 7.1A.4(b) and 3.10.5A, the Company makes the following disclosures in respect of the Shares issued under the Tranche 1 Placement pursuant to Listing Rule 7.1(A): The dilutive effect of the Shares on existing shareholders, as a result of the issue of Shares under the Tranche 1 Placement, is as follows:

Due to the fact that the Shares were issued at a significant premium to the Company’s preannouncement share price, the Company decided to raise funds by way of a cornerstone investment under the SSA, and not as (or in addition to) a pro rata issue or other type of issue in which existing ordinary security holders would have been eligible to participate.

No underwriting arrangements are applicable to Tranche 1, however, the Subscribers were introduced to the Company by Patersons Securities Ltd (Patersons) and Palladion Partners, and the placement was managed by Patersons. A selling fee of $42,000 is payable by the Company in respect of Tranche 1 and a management fee of $40,000 is payable in respect of the total investment under the SSA.

To view the full announcement, please click here. 

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