Forte Energy (LON:FTE, ASX:FTE) has issued 41mln shares to Dutchess Opportunity Cayman Fund after the fund exercised a share conversion option.
The shares were converted as per the terms of the US$1mln loan facility that was announced in June 2013, at 0.94 Australian cents (0.57p) per share.
Under the terms of that facility, Dutchess may elect to convert 133% of all or part of the outstanding amount drawn down (plus accrued interest) by Forte into shares at a price per share equal to 75% of the volume-weighted average market price for the 15 trading days immediately preceding the conversion date. Interest accrues on all draw-down amounts at a rate of 8% per annum, capitalised annually.
Following the conversion, there is an outstanding amount of US$335,788 drawn down under the terms of the facility.
Earlier this month, Forte unveiled plans to merge with Leo Mining & Exploration (Leominex), a vehicle that owns a 48% stake in Toronto-listed Mkango Resources (CVE:MKA), in an all-share deal.