Tanfield Group PLC Loan Note Instrument (5023M)
24 Mai 2022 - 8:00AM
UK Regulatory
TIDMTAN
RNS Number : 5023M
Tanfield Group PLC
24 May 2022
The information contained within this announcement is deemed by
the Company to constitute inside information under the Market Abuse
Regulation (EU) No. 596/2014. Upon the publication of this
announcement via a Regulatory Information Service ("RIS"), this
inside information is now considered to be in the public domain
Tanfield Group Plc
("Tanfield" or the "Company")
Loan Note Instrument
The Board of Tanfield (the "Board") is pleased to update the
market with respect to additional loans put in place to fund the
Company's ongoing legal proceedings in relation to its investment
in Snorkel International Holdings LLC ("Snorkel"), the aerial work
platform business, as well as general working capital.
Investment Background
-- Tanfield is a 49% shareholder in the equity of Snorkel
following the joint venture between the Company and Xtreme
Manufacturing LLC ("Xtreme") (the "Contemplated Transaction"), a
company owned by Don Ahern of Ahern Rentals Inc, relating to
Snorkel, in October 2013.
-- T he Snorkel investment is valued at GBP19.1m. The outcome of
the US and UK Proceedings referenced below could have an impact on
this valuation.
-- On 22 October 2019, the Company announced that it had
received a Summons and Complaint, filed in Nevada (the "US
Proceedings") by subsidiaries of Xtreme, relating to the
Contemplated Transaction .
-- On 24 October 2019, the Company announced it had become
necessary to issue and serve a claim in the English High Court
against Ward Hadaway (the "UK Proceedings"), the solicitor acting
for the Company at the time of the Contemplated Transaction, in
order to fully protect the Company's rights pending the outcome of
the US Proceedings.
-- On 26 February 2021, Ward Hadaway were granted permission to
join Foulston Siefkin, Tanfield's US based law firm who were
retained in 2013 to draft the documents governed by US law relating
to the Contemplated Transaction, into the UK Proceedings. As a
result, the Company amended its claim to include Foulston Siefkin
as a second defendant.
Loan Subscription
Further to the update on 3 March 2022, in which the Company
announced that the first loan note instrument (the "First Loan") of
up to GBP700,000 had subscriptions totalling GBP625,000, and the
second loan note instrument (the "Second Loan") of up to GBP1m had
subscriptions totalling GBP950,000, the Board is pleased to
announce that the Company has put in place a third loan note
instrument (the "Third Loan") of up to GBP2m. The Third Loan will
be used for providing ongoing funding for the US and UK
Proceedings, as well as general working capital.
The Third Loan is unsecured and carries annual interest of 10%
which is to accrue and is repayable on the earlier of (i) 28
February 2025 or (ii) receipt of funds relating to either the US or
UK Proceedings. Should repayment take place prior to 28 February
2025, a 20% early redemption premium shall apply.
A number of existing shareholders have subscribed to the Third
Loan and have collectively committed to subscribe to an initial sum
of GBP950,000, which constitutes a related party transaction under
Rule 13 of the AIM Rules as a result of OTK Holding A/S and Zoar
Invest Aps, which each hold approximately 14% of the issued shares
of the Company, subscribing GBP500,000 and GBP200,000 respectively
to the Third Loan. The Directors of the Company, having consulted
with WH Ireland Limited, the Company's nominated adviser, consider
the terms of the transaction to be fair and reasonable in so far as
shareholders are concerned .
The Board believe that further subscriptions to the Third Loan
may be necessary to ensure that the Company continues to protect
its investment in Snorkel. Following discussions with the existing
shareholders, if further subscriptions were required, the Board are
of the opinion that further funding will be made available.
The Board believes that a positive outcome to either or both of
the US and UK Proceedings is a reasonable expectation, and the
Company will continue to vigorously defend and advance its position
in both proceedings, whilst continuing to seek advice.
Further updates will be provided to Shareholders as and when
appropriate.
For further information:
Tanfield Group Plc 020 7220 1666
Daryn Robinson
WH Ireland Limited - Nominated Advisor / Broker
James Joyce / Megan Liddell 020 7220 1666
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END
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