15th Mar 2019 09:36
LONDON (Alliance News) - Regency Mines PLC on Friday said YA II PN Ltd and Riverfort Global Capital Ltd have converted part of their loan note into shares.
Of the USD1.3 million loan note, which was announced in June 2018 and refinanced in January 2019, USD105,706 has been converted. Consequently, Regency Mines has issued 97.3 million shares at a price of 0.0823p per share to the two companies.
Once these shares are admitted, Regency Mines' entire issued share capital will be 974.5 million shares.
Shares in Regency Mines were down 16% at 0.08 pence on Friday morning and down 44% from last Friday.
On Monday, the company warned it may have to forfeit control of its interests in its Mining Equity Trust LLC joint venture and US coal operations in order to restructure its debt.
At that time, Regency Mines said it was in talks with a group of institutional investors concerning "several payments" that may be due under its existing loan note and expressed concern that its inability to make payments could necessitate further restructuring.
Such restructuring may even require the company to forfeit control of its US coal operations and Mining Equity Trust interests, because the assets are already pledged as collateral to Regency Mines' lenders.
At Regency Mines' annual general meeting late last month, directors were given authority to issue 500.0 million new shares but were not given authority by shareholders to dis-apply pre-emption rights over any share issue.
The miner's business model had depended on its ability to issue new shares in order to fund working capital and project development. The necessary resolution having been defeated, Regency Mines has been in discussions with its stakeholders around its business requirements, including its operational and financial obligations.
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