San Leon, the independent oil and gas production, development and exploration company focused on Nigeria, announces an update on the Company's secured US$5.0 million loan (the "Loan") from funds managed by Toscafund Asset Management LLP ("Toscafund").
On 8 August 2023, the Company announced, amongst other matters, that it had entered into the Loan with the Company's largest shareholder, being certain funds managed by Toscafund. The Loan carries a coupon of 10 per cent. per annum. The Loan was originally repayable by no later than 7 September 2023. On 2 October 2023 the Loan repayment date was subsequently extended to 6 October 2023. As part of the Loan, San Leon entered into security arrangements with the funds managed by Toscafund that comprise both a debenture issued by the Company as well as assignments and pledges over all of its group companies' loan and equity interests in ELI (the "Security"). The Security will be released upon full repayment of the Loan.
San Leon's discussions with a third party in relation to securing an alternative loan facility (as mentioned in previous announcements) are now at a very advanced stage and, in order to enable them to conclude, Toscafund has provided the Company with a redemption and release letter which sets out, inter alia, the arrangements for the release of the Security. Specifically, the redemption and release letter includes a standstill provision by which Toscafund have agreed not to make any demand for repayment of the Loan or enforce the Security before 13 October 2023. All other terms of the Loan remain unchanged. The board of San Leon (the "Board") believes that a conclusion on an alternative loan facility will be reached in the very near term and will provide an update to shareholders and creditors at that time.
