Gulfsands funded to 2018 with new £4m facility

16th Feb 2017 08:20

(ShareCast News) - Syria, Tunisia, Colombia and Morocco-focussed oil and gas company Gulfsands Petroleum announced on Thursday that it finalised a secured term facility of up to £4m with its major shareholders.The AIM-traded firm confirmed the lenders as Waterford Finance & Investment, Blake Holdings and ME Investments.Their participation levels within the facility varied, with Waterford committing £1.49m, or 37.3% of the facility, Blake Holdings committing £1.26m, or 31.45%, and ME Investments committing £1.25m, or 31.25%.The facility would be available for drawdown by the company in five equal tranches of £0.8m, the board confirmed, with the first available immediately upon the satisfaction of various administrative conditions precedent, and the further tranches being available on or after 31 March, 30 June, 30 September and 31 December 2017.Gulfsands said the first two tranches, being the immediate tranche and the one on 31 March, were committed by the lenders, while the final three tranches, although the terms were agreed, remained subject to re-approval by each of the lenders prior to each drawdown request.Interest on loans made, together with accrued fees and interest, would run at 7% per annum.A commitment fee of 1% per annum would run on any undrawn proportion of the facility, the board said, with all fees and interest accruing quarterly until maturity."The proceeds will be used for general and administrative expenses of the group and for working capital purposes and, based on current forecasts, if fully drawn down, are anticipated to fund the company through to the first half of 2018," the Gulfsands board explained in a statement."It is the intention of the board to seek equity financing for the Group in due course."If an equity raise takes place the lenders will be entitled to be prepaid on the terms noted above, provided the lenders agree that the full amount to be prepaid is subscribed for equity in such equity raise."The maturity date of the facility was three years from the first drawdown date, at which date all outstanding amounts would be repayable in cash unless the company exercised an equity conversion right.