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2012-03-30 15:10:00 CEST 2012-03-30 15:10:02 CEST REGULATED INFORMATION GeoSentric Oyj - Company AnnouncementFUNDING UPDATE – DISCUSSIONS REGARDING A NON-BINDING FUNDING OFFER COMPLETED. SIGNED HEADS OF TERMS RECEIVED. EXECUTION STILL SUBJECT TO APPROVAL BY LARGEST SHAREHOLDERSGEOSENTRIC OYJ STOCK EXCHANGE RELEASE March 30, 2012 at 16.10 pm FUNDING UPDATE - DISCUSSIONS REGARDING A NON-BINDING FUNDING OFFER COMPLETED. SIGNED HEADS OF TERMS RECEIVED. EXECUTION STILL SUBJECT TO APPROVAL BY LARGEST SHAREHOLDERS As previously announced, the Company did not raise the full targeted amount in its directed rights offering last year and, as a result, the Company has been continuing to explore all options available to it to ensure that it has sufficient liquidity to secure its operations through 2012 and beyond. The Company's current cash resources are only sufficient to finance the business into Q1 2012 and any alternative funding options should therefore be concluded as soon as possible. To address this issue the Company has proposed issuing a secured interest-bearing loan note and has been in contact with its known major shareholders to seek their interest in such an instrument and to request their feedback on any alternative terms or instruments that may be more acceptable or attractive to them. On March, 6, 2012, the Company reported that, although it had not received any definitive investment commitments, it had received a non-binding proposal from an independent advisory business representing a number of investors for a funding of up to €250,000. On March 9, 2012, the Company reported that it was been engaged in active discussions on this proposal to answer a number of questions that were raised and to secure acceptable terms for this proposed investment. On March 16, 2012, the Company reported that it had submitted a counter proposal to the independent advisory business seeking to address their requirements while securing the best possible terms for the Company. And, on March 26, the Company reported that it had received a response to its counter proposal, and was continuing active discussions to secure the funding under the best possible terms, and that the Company was aiming to finalise a definitive investment agreement in the next few days. The Company has now completed the discussions and has received a signed proposal from the independent advisory business for a funding of €350,000. The proposal requires certain pre-conditions be satisfied before the funding will be received by the Company. This includes certain terms that must be agreed by existing Company's largest shareholders. The Company is actively working on satisfying these pre-conditions. The Company is planning to invite the shareholders' meeting to approve the funding. The Company will update the market again as soon as these pre-conditions are satisfied and in any event no later than April 03, 2012. The Company has already announced and confirmed directly with the major shareholders that, in the absence of securing any viable alternatives, the Board would be left with no choice other than to seek an orderly disposal of the Company's assets (which are comprised almost entirely of its 24% equity investment in GHNV), which ultimately could lead to a winding up of the Company. Given the previously reported first preference of €5 million that Schroders has over the assets of GHNV on any disposal or winding up, this is likely to lead to equity shareholders of the Company receiving no final capital distribution on a winding up. Meanwhile the Board continues to retain and pursue, where appropriate, all realistic strategic options open to it in order to raise the necessary funding including another directed share offering, further cost cutting measures where possible, asset sales and other possible sources of external finance. GEOSENTRIC OYJ Board of Directors Distribution: NASDAQ OMX Helsinki Principal news media |
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