What are your Opinions JR/Godot/Shadow. Do you think Providence have a limit on the time they will wait for Farmanee to raise funding. Do you think there is a penalty clause included in the agreement on commercial terms announced i.e. if farmanee says no cash raised do you think Farmanee would have to pay some cash to Providence. If not than it would seem like it is an option for the Farmanee to do what it likes when it likes and on terms beneficial to itself.
From: Michael Graham [mailto:[email protected]]
Sent: Thursday, February 12, 2015 1
1 PM
To:
Subject: FW: Additional Questions regarding Barryroe
Thank you for your e mail.
I understand shareholders disappointment at the current fall in the share price. As has been published the Company does have a short term loan facility in place. The Board are acutely aware of the Company's financing needs and are actively considering a number of options available to us, including the benefits of the proposed Barryroe farm in. In relation to the Barryroe farm-out, I am precluded from commenting on any of the questions you raise. In accordance with our ongoing Stock Exchange obligations, we will continue to provide the market with updates as and if when appropriate.
Michael Graham
Secretary
From:
Sent: 12 February 2015 11:15
To: Michael Graham; Providence Resources
Subject: Additional Questions regarding Barryroe
Hello there Michael
Another terrible day in the Markets as you are well aware and some very very upset shareholders myself included.
I understand that there are limits to what can be disclosed but given that we are all losing our shirts in the process in what appears on the face of things to be a very bad situation I have some more questions that I would like to ask.
Providence have a loan which they are using to run the company, pay salaries etc etc. In June this loan has to be paid back. Providence has told us that a commercial agreement on Barryroe has been reached conditional on funding.
With Providence facing a June payback date for its 20 million loan facility has this been taken into account when making this commercial agreement on Barryroe ?
Has Providence included a penalty clause in their commercial agreement with its counterparty i.e will the counterparty to the commercial deal be liable for a cash payment to Providence in the event of failure to raise funding ?.
If there is no penalty clause in this commercial agreement then it would appear that it is not an agreement but an option by the counterparty to Farm in or not to Barryroe at a timing and under the conditions that are most advantageous to itself.
Why would the counterparty be in any rush to provide funding knowing the financal position of Providence and its June date for loan repayment ?
Has Providence placed a cutoff date on the commercial agreement i.e does the counterparty have to produce funding by a certain date or is its option open ended ?
If no deal is done on Barryroe is there a plan B arranged to allow us to meet funding requirements; pay salaries, pay loans, daily running costs, drilling plans etc etc. ?
The share price at the moment is a clear indication of the impression correct or not that the market has of Providence´s position. I myself have been investing in Providence (just buying since 2005). I have never sold a share in this company believing that we would have a good future but am anxious at present
TOR SNR´s sale announced via a late RNS and a vague RNS regarding Barryroe commercial conditional deal have left us all high and dry. Can TOR justify his 500k salary along with the rest of the BOD. We have absolutely no idea when the deal will close and are expected to Trust TOR whose father has just dumped 6% on the market. Difficult to stomach. All we can do is trust that it is all above board, that the Farminee whom we all think is Sequa won´t take us for a ride and confide in the BOD to restore some confidence.
TOR´s annual Salary now equates to 1.25 percent of the market capitalization of the company .
Thank you for your email.
As we state in the RNS, we have agreed commercial terms, but due to the proposed farminee having to close its financing, it is still conditional. Under an agreed confidentiality provision, neither party can issue a RNS advising on names involved or deal terms, until such time as the deal has closed. Once this happens, both companies are then in a position to update on the deal terms and the forward programme.
We issued the RNS on Monday regarding Spanish Point and having discussed with our advisors, and in direct response to significant media and shareholder enquiries, we used this RNS to provide a short no names/no terms update on the Barryroe farm out process. We discussed this with the proposed farminee who was comfortable as no names or terms were disclosed. As for the counter party raising funds, we understand that they have been working on their financing well in advance of agreeing terms with us. We also understand that their corporate financing plans extend beyond their proposed investment in Barryroe.
As regards your enquiry regarding the major shareholder, I can confirm that we received notification of his reduced holding this week and as required, we issued a notification to the exchange. You are correct that ACC notified us last week of their increased holding and again, we immediately issued a notification to the market. To be clear, we have no information if any deals are related and we cannot speculate on changes in shareholdings and neither can we control the manner or timing of when we are notified on these matters. We simply issue notifications when received.
Still waiting for a response to my email. I still believe that Providence should clarify what was the situation with TOR SNR shares. Did these go to ACC. Why the difference in RNS dates. Surely with TOR JNR being the son of TOR SNR and alo the CEO of this company a 6% reduction in TOR SNR´s shareholder warrants an explanation from the company. It is natural that the share price would drop on this news. A simple yes these shares were passed to ACC as part of payment for monies due would ease the market. With no clarity on this point the shareholders are being held out to dry. Also announcing that a commercial agreement has been reached without funding has left the share price vulnerable to market shorters as we wait in ignorance for something that may or may not happen
Just sent this email to Providence. Lets see what we are told.
Good Morning to you.
We spoke before Christmas regarding the state of affairs at Providence and I expressed my concern with the share price and the lack of news regarding Barryroe amongst other things. Was thus relieved to see Monday´s RNS regarding SP and Barryroe although like all shareholders do not really know what to read into the commercial deal agreement and pending the raising of finance by potential farm in partner.
Have a number of questions.
When was this commercial agreement reached i.e. was it just reached last week or was it reached some time ago. i.e. was an RNS issued immediately upon the commercial agreement which I imagine is a legal contract. ?
Will the Farm in Partner now begin to source the finance required i.e. was Farm in Partner waiting for this commercial agreement before going ahead with plans to raise finance. ?
We see that Mr o Reilly Senior has reduced his holdings to 9.49% of the Capital of the company. This announced via RNS. This announcement was made yesterday February 10th 2015. Last week we were informed that ACC now holds an equivalent amount of shares in the company.
Would thus like to know the following
Are the shares held now by ACC the same shares that we were informed about in yesterday´s RNS that Mr o Reilly Senior Sold ?
If they are the same shares then why were there two separate RNS announcements separated by various days. ?
The sale of such a massive amount of shares by the biggest shareholder in the company is of great concern to us the shareholders and not a minor matter as we can see reflected in this morning`s share price collapse.
Thanks you very much for your time
Bye
A worried Shareholder
If TOR's 6% went to ACC then todays RNS would be illegal. When an RNS is announced I imagine paperwork is required to back up statements i.e records of buyers and seller of shares in this case. It would be difficult to pretendvto LSE that the shares were not passed to ACC just because RNS was delayed. Also cannot see why TOR snr would do this - no advantage to himself. Thus a more likely alternative is that TOR snr is offloading his shares to one of his other offshore based holdings. If the share price of Providence was expected to rise in near future doing this would make sense especially when you have ACC breathing down your neck. There is circa 50% of this company in the hands of unknown shareholders. TOR snr had 49% at one stage. Perhaps many shares were transfered to sub 3% holdings in offshore companies a long time ago
Thanks Godot and what will the final percentages for Providence be in your opinion on Barryroe