Reference is made to the announcements disclosed on 10 June 2018 and 22 February 2019 and the details provided therein. Reference is further made to the disclosure of large shareholding made on 8 August 2019. As the conversion price relating to the announcement made on 8 August 2019 was below the par value of the shares in Element, the number of conversion shares will be adjusted to reflect issuance at the par value. As such, the new number of shares to be received pursuant to conversion of 31 convertible notes, as announced on 8 August 2019, amounts to 1,937,500 shares in Element (the “New Shares”).
The New Shares are expected to be issued and delivered to European High Growth Opportunities Securitization Fund represented by European High Growth Opportunities Securitization Fund Manco SA (“EHGO”) as soon as the share capital increase pertaining to the conversion has been registered in the Norwegian Register of Business Enterprises. EHGO notes the announcement made by Element on 15 August 2019 regarding its view that it is not required to honour the conversion notice. EHGO maintains that the conversion notice is valid and that Element is required to proceed to issue the conversion shares.
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Following receipt of the New Shares EHGO will hold (i) 4,086,174 shares in Element (including 287,500 shares which are borrowed, refer to the below), equal to 23.4043% of the new share capital (the New Share Capital”)*, (ii) 2,400,000 convertible notes convertible to 1,500,000 shares in Element (as at today’s conversion price, but adjustable if the conversion price is adjusted at the time of conversion), equal to 8.59% of the New Share Capital and (iii) 1,706,637 warrants giving the right to 1,706,637 shares in Element, equal to 9.78% of the New Share Capital.
Furthermore, EHGO has an obligation to redeliver 287,500 borrowed shares in Element pursuant to loan agreements with Legacy Hill Resources Ltd and Element, as disclosed on 18 March 2019.
Following receipt of the New Shares, EHGO’s total holding of shares and rights to shares (through warrants to shares) will make up 7,292,800 shares and votes, equal to 42% of the New Share Capital.
EHGO is a fund managed by Alpha Blue Ocean Inc. (“ABO”). ABO owns 309,368 warrants in Element giving the right to 309,368 New Shares in Element, equal to 1.77% of the New Share Capital.
ABO’s total holding of shares and rights to shares (based on convertible notes, warrants and borrowed shares) on a consolidated basis, make up 7,602,179 shares and votes, equal to 43.54% of the New Share Capital.
*The calculations above are based on the new share capital following issuance of the New Shares pursuant to the notice for conversion of notes by EHGO on 7 August 2019, as adjusted for the number of shares as disclosed herein.
The disclosure regulation (flaggereglene) requires that the disclosure thresholds regarding rights to shares (i.e. notes and warrants) are calculated on the basis of the registered share capital of the issuer at the time of disclosure and do not give the correct view taking into account the situation at the time of conversion/exercise of rights to shares. On a fully diluted basis, taking into account all share issuances pursuant to convertible bonds and warrants, ABO’s consolidated holding of shares and rights to shares will amount to 41.96% of the Share Capital of Element.
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About Alpha Blue Ocean Inc.
Alpha Blue Ocean Inc. is an international business company incorporated under the laws of the Republic of Seychelles, represented by Mr. Pierre Vannineuse. Mr. Pierre Vannineuse is the sole shareholder Alpha Blue Ocean Inc. is a member of the Blue Ocean Investment Group. Alpha Blue Ocean Inc. was created by Pierre Vannineuse and manages an asset portfolio of around 300 million dollars for a group of funds. Blue Ocean specializes in providing flexible, innovating and non-invasive debt and capital financing arrangements to listed companies throughout the world and in various sectors such as healthcare, energy, mining and high tech. Alpha Blue Ocean Inc. has offices in London and Geneva.
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