Roxi Petroleum announced Friday that it has entered into an agreement with Canamens Limited and Sector Spesit IV, a sub-fund of Sector Umbrella Trust, to cancel future royalty payments due to them from production at Roxi's BNG asset, located in Kazakhstan.
As part of the agreement, the royalty payments would be cancelled in return for the issue of 46,661,654 fully paid ordinary shares representing five percent of the enlarged Roxi issued ordinary share capital. Completion of the cancellation agreement is conditional on the passing of certain resolutions at Roxi’s annual general meeting, which will be held on July 24, 2015.
Clive Carver, Roxi Petroleum chairman, commented in a company statement:
"This is an excellent deal for Roxi. On completion, we have removed a future uncapped liability, which may have affected the company's ability to secure traditional debt funding, and replaced it with a supportive institutional shareholder."
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