TXO : Notice of General Meeting

TXO PLC
("TXO" or the "Company")

Issue of new convertible loan note
Re-Financing of existing convertible loans

Notice of General Meeting

TXO, the AIM-quoted energy resource and clean technology investment company, announces that it has secured additional funding of up to £1 million via a new zero coupon Convertible Loan Note. It has also reached agreement to restructure its remaining outstanding Convertible Loan Notes and is calling a General Meeting to consider the Resolutions detailed below.

The new monies raised will be used to make a partial repayment of the 2014 Convertible Loan Notes, which were issued in September to November of 2011, September to November of 2012, and November of 2013. A repayment schedule has been agreed in respect of the balance. The new monies raised are also intended to make a partial repayment of the Bergen Asset Management LLC ("Bergen") convertible securities facility announced on 11th February 2014. Any unutilised balance will be available to increase the Company's working capital. The Company has also agreed variations with Bergen in order to accommodate the zero coupon Convertible Loan Note.

New Convertible Loan Note

The Company has secured up to £1 million of new money through a zero coupon Convertible Loan Note ("Loan Note") from an investor in the Bahamas ("the Lender"). An initial £50,000 has already been drawn. The next drawdown of up to £400,000 is available from 31 October 2014 to 31 December 2014 ("First Drawdown"). The balance of the Loan Note may be drawn down in whole or in part between 30 November 2014 and 31 December 2014. The Loan Note is repayable on or before 31 October 2016, and may be converted at the Lender's discretion into new ordinary shares in TXO at any time following the date 14 days from the First Drawdown at the lower of 0.16p per share or a 20% discount to the average mid-market closing price for the 28 days preceding the date of any conversion notice, providing such conversion shall not take the interest of the Lender (and any persons acting in concert with the Lender) to more than 29.9% of the enlarged equity of TXO. It is anticipated that the Company will give a charge over 254 ordinary shares of $1 each in the capital of the Grand Bahama Group Limited ("GBG"), representing 20% of GBG's issued share capital, in consideration for full drawdown of the Loan Note.

The investment funds have been introduced by directors of GBG and, in recognition, GBG is to be issued 15m new ordinary shares in TXO as a fee for doing so.

Extension and variation of 2014 Convertible Loan Notes

The holders of a further £63,167 of 2014 Convertible Loan Notes ("CLN") have agreed an extension of the term from October 2014 to October 2015. Holders of CLNs amounting to an aggregate of £284,357 have now agreed to extend the term from October 2014 to October 2015 ("the £284,357 October 2015 CLNs"). The Company has also agreed to reduce the conversion price on the £284,357 October 2015 CLNs from 0.4p to 0.2p, conditional on the lenders giving waivers on certain warranties given to it by TXO.

Of the £504,486 of the CLNs which are due for repayment on 31 October 2014, the Company has agreed a variation of the terms in respect of £300,000 held by one party.

Under the terms of the variation, £100,000 of the outstanding amount is to be repaid on or before 31 October 2014 and the balance of £200,000 is to be repaid on or before 31 October 2015. The £300,000 will no longer be convertible into ordinary shares of TXO.

The interest rate on the above-mentioned £200,000 loan note is to be increased from 10% to 15% per annum with effect from 1 November 2014. In addition, a redemption premium will be payable in shares at the prevailing mid-market share price on the repayment of the balance of the CLNs calculated as the value of the amount repaid multiplied by the percentage increase in the share price at repayment over the average market share price for the 5 days preceding this announcement.

£204,486 of the CLNs remains repayable by 31 October 2014 (the "Residual 2014 CLNs").

Variation of Bergen facility

On February 11, 2014, the Company announced a Convertible Securities Deed in relation to a phased investment issue of convertible securities of up to £1,745,000 by Bergen Global Opportunity Fund, LP ("Bergen") (the "Agreement"). On February 18, 2014, the Company issued a convertible security with a face value of £425,000 and, on May 27, 2014, the Company issued a convertible security with a face value of £185,000, under the Agreement. The nominal value of the convertible securities issued to Bergen currently stands at £453,500. By mutual consent of Bergen and the Company, (a) no further advances will be made under the Agreement until mutually agreed, (b) £150,000 of the monies advanced under the Agreement will be repaid by the Company in cash on an agreed schedule, and (c) subject to the Company meeting such schedule, no further conversion will be made by Bergen for the remainder of this calendar year.

For clarity, Bergen has met all of its obligations to the Company under its Agreement, and has been a flexible and accommodating funding partner to the Company.

General Meeting

In order for the Company to achieve the financing objectives above, the Directors consider it necessary to seek approval to increase the share authorities as set out in the Resolutions described in the Notice of Meeting being sent to shareholders. The Board believes that the financial restructuring is in the best interests of shareholders and also gives greater long term stability to TXO.

In addition, the Board is seeking authorisation, as required under the Company's Articles of Association, to cap the remuneration payable to Non-Executive Directors (at £40,000 per Director) to facilitate a proposed bonus scheme for Directors and employees of the Company.

It is anticipated that participants in the bonus scheme, which it is intended will be adopted following the General Meeting and conditional upon the passing of the Resolutions, would be entitled to an annual bonus calculated by reference to the increase in audited profits and investment value of the Company. Further details of the proposed bonus scheme will be announced in due course.

The General Meeting is to be held at Cassiobury Suite, 54 Clarendon Road, Watford, Hertfordshire, WD17 1DU on 23rd October 2014 at 2.00 pm.

Cash Balance and Outstanding Commitments - post restructuring

Following the execution of the above agreements, and assuming full draw down of the Loan Note and repayment of the Residual 2014 CLNs, the Company would have a net cash inflow of approximately £545,000 and will have the following outstanding loan note commitments following 31 October 2014:

• £284,357 October 2015 CLNs;
• £200,000 loan note due 31 October 2015;
• £303,500 zero coupon convertible due May 2016 under the Bergen facility; and
• £1m Loan Note due 31 October 2016.

Tim Baldwin, Chairman and CEO of TXO, commented:

"This refinancing strengthens the balance sheet with parties that understand the business and our objectives in the Bahamas, where they have strong connections. It addresses the Company's short term funding issues and reduces the prospect of further share dilution other than as a consequence of the financing plans above. As a result, the plc is under no financial pressure and can allow its investments to develop accordingly."

For further information, please contact:

TXO PLC
Tim Baldwin, Chairman and CEO             [phone]

Northland Capital Partners Limited         [phone]
John Howes / Alice Lane
Sales and Broking

Edward Hutton / William Vandyk
Nominated Adviser

Lothbury Financial Services Limited       [phone]
Michael Padley / Chris Roberts

Editors' Note
TXO PLC, the AIM quoted oil and gas investment company, has four main investments namely: The Grand Bahama Group Limited ("GBG") which is establishing a waste oil collection facility and Hydrocarbon Recovery Plant in the Bahamas at Freeport and also produces oil from its leases in Western Kentucky, USA; Oil Recovery Services Limited ("ORS"), which has proprietary technology for the reprocessing of contaminated oils and the remediation of dirty water; Oil Tech Royalties Inc ("OTR"), a joint venture company with a licence to commercialise a proprietary acoustic flow reactor valve; Athabasca Resources Limited ("Athabasca Resources") which has signed an agreement to acquire a 50 per cent. farm-in interest in certain Alberta Crown Leases covering 7,936 hectares in the Athabasca oil sands in Alberta, Canada. TXO also has an interest in Tasmania Oil and Gas Limited ("TOG") a joint venture company set-up to exploit a gas and oil opportunity in Tasmania, Australia, which is non-core.

TXO currently holds a 35.67 per cent. interest in GBG, a 25.1 per cent. interest in ORS, a 30 per cent. interest in OTR and an 18.8 per cent. interest in Athabasca Resources. It retains a 25 per cent. interest in TOG.