Touchstone Proposes Up To $30mn Private Placement

(Touchstone, 2.Nov.2020) — Touchstone Exploration Inc. proposed placing in the UK and Canada of up to $30mn (approximately £23.2mn and C$40mn) through the issue of common shares of no par value (the”Placing Shares”) with institutional and other investors in the United Kingdom and Canada.

In the event of excess demand, the company reservesthe right to increase the size of the Placing. The Placing in the UK is being completed by way of an accelerated bookbuild and placees will subscribe for Placing Shares pursuant to the terms and conditions set out in the Appendix to this announcement (the”UK Placing”). In Canada, placees will subscribe for Placing Shares pursuant to customary subscription agreements (the “Canadian Placing”).

Shore Capital and Canaccord (each as defined below) are acting as Joint Bookrunners in connection with the UK Placing. Canaccord is Sole Bookrunner in respect of the Canadian Placing.

Background to the Placing and Use of Proceeds

To date, the company has drilled three successful gross exploration wells (2.4 net) on the Ortoire block, onshore in the Republic of Trinidad and Tobago (Touchstone 80% working interest). Touchstone spudded its fourth exploration well, Cascadura-Deep, on 27 October 2020.On the basis of three significant natural gas discoveries to date, the Company is seeking to raise up to $30mn to fund continued exploration, development and production activities at Ortoire, including:

•Cascadura-1ST1 –surface facility development;

•Chinook-1 –completion, testing and potential surface facility development;

•Cascadura Deep –drilling, potential completion, testing and surface facility development; and

•Royston –drilling and potential completion and testing.

The company also intends to use a portion of the net proceeds of the Placing to fund a seismic program in order to fulfil its work commitments under the Ortoire exploration and production licence, as well as for working capital purposes.

Details of the UK Placing

The Placing is being completed within the company’s existing share issuance authorities. Shore Capital and Corporate Limited and Shore Capital Stockbrokers Limited (together, “Shore Capital”) and Canaccord Genuity Limited (“Canaccord”) will be conducting an accelerated book building process, in respect of the UK Placing (the “Bookbuild”). The book will open with immediate effect. Shore Capital and Canaccord have entered into an agreement with Touchstone (the “Placing Agreement”) under which, subject to the conditions set out therein, Shore Capital and Canaccord will agree to use their respective reasonable endeavours to procure subscribers for the Placing Shares in the UK. The UK Placing is subject to the terms and conditions set out in the Appendix to this announcement. Members of the public are not entitled to participate in the Placing.

The Placing Shares will, when issued, be credited as fully paid and will rank pari passu in all respects with Touchstone’s existing issued common shares of no par value each (“Common Shares”). Details of the final number of Placing Shares and the price per Placing Share (“Placing Price”)will be announced as soon as practicable after the closing of the Bookbuild.The Placing is not being underwritten.

Details of the Canadian Placing

Placement of the Placing Shares in Canada will be to “accredited investors” only pursuant to subscription agreements containing certain representations, warranties, acknowledgments and covenants of both the placee and the company the (“Subscription Agreements”), with Canadian placees having certain statutory and other rights of action against the Company. The Placing Price for Canadian placees pursuant to the Subscription Agreements will be the same as for placees participating in the UK Placing.

Admission and Settlement

Application will be made for the Placing Shares to be admitted to trading (“Admission”) on the AIM market of the London Stock Exchange (“AIM’) and the Toronto Stock Exchange (“TSX”). It is expected that Admission will take place at or around 8.00 a.m. (London time) on 12 November (or such later date as may be agreed between the company, Shore Capital and Canaccord). The UK Placing is conditional upon, inter alia, Admission becoming effective. The UK Placing is also conditional upon the Placing Agreement not being terminated in accordance with its terms. The Canadian Placing is also conditional, inter alia, upon completion and return of the Subscription Agreements.

Placing Shares issued in connection with the Canadian Placing will be subject to a four-month and one day restricted hold period, which will prevent such Placing Shares from being resold in Canada, through a Canadian exchange or otherwise, during the restricted period without an exemption from the Canadian prospectus requirement. Any Placing Shares placed outside of Canada pursuant to the UK Placing will be subject to the same four-month and one day restricted hold period, which will prevent such Placing Shares from being sold in Canada, but such Placing Shares will otherwise be freely transferable.

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