African Pioneer has agreed with Sanderson Capital Partners to establish a £1 million unsecured convertible loan funding facility.
The company own the Ongombo and Ongeama copper projects in Namibia, Botswana and Zambia.
The facility is a standby facility that could provide the company with an additional source of working capital when the funding market for junior exploration companies is subject to market volatility.
The company can draw down the facility in four £250,000 tranches within six months of June 1, 2024, July 7, 2024, August 31, 2024, and October 31, 2024.
African Pioneer can also use the facility, at its discretion, to fund its working capital requirements and subsidiaries.
Unless otherwise converted, African Pioneer must repay each loan tranche on the first anniversary of the lender’s advance.
African Pioneer may prepay the whole or part of the facility on any day before the maturity date for a loan tranche upon giving not less than 14 days prior written notice to the lender.
Sanderson Capital Partners may at any time during the facility period elect to convert all or part of any drawn down amount into such number of new African Pioneer Plc, no par ordinary shares equal to the amount of the loan tranche that is to be repaid at the date of the election, divided by the 2.8 pence.
The conversion price is 40% higher than the closing share price of 2 pence per ordinary share on May 1, 2024, the latest practicable date before this announcement.
African Pioneer will pay Sanderson Capital Partners an arrangement fee of 10% of the facility amount to be settled by the issue of 5,089,177 new shares credited as fully paid at an issue price of 1.965 p per share.
The facility fee shares shall be issued on or before December 31, 2024, or such other date agreed by the parties.
