Shares in Vatukoula Gold Mines rocketed on Monday after the company revealed it has entered into a subscription agreement with SCD Energy, a subsidiary of DRK Energy.
SCD will subscribe for 30m new ordinary shares (equal to 19.2% of the enlarged issued share capital) at 15p per share, raising £4.5m.
The subscription will be completed over a monthy in two equal tranches, the first by May 28th and the second by June 17th.
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Vatukoula and DRK have also to work in conjunction to source the required debt financing to fund the Company's planned expansion programme.
As such, if VGM enters into a debt financing package facilitated or introduced by DRK of no less than $40m within 120 days of the subscription agreement, DRK will have the option to acquire an additional 24m new ordinary shares in the company at an exercise price of 15p per share.
However, if the company secures the debt financing within the 120 days from institutions that it is currently in discussions with, the option exercise price will be the lower of 25p or 90% of the five day trading volume weighted average price following the announcement of the debt financing.
The share price rocketed 55.68% to 9.73p by 09:43 Monday.
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