TIDMSGN
RNS Number : 6915A
Solgenics Limited
25 May 2023
News Release
Directors Loan
25 May 2023: Solgenics Limited (the "Company") an African
renewables development company focused on a 300MW solar PV plus
Battery Energy Storage System ("BESS") renewable energy project in
Tete Province, Mozambique (the "Tete Solar Project" or the
"Project") today announces that, further to the Company's
announcement of 3 May 2023, it has entered into a up to $230,000
working capital loan with a Director and a Director controlled
company (the "Loan") to cover delisting costs and to fund the
Company's working capital requirements up to the end of Q2
2023.
Solgenics Chief Executive Officer, Hanno Pengilly said: "The
Company has an urgent need for funding and finalisation of the up
to US$230,000 loan ensures the Company is adequately capitalised
until the end of Q2 2023, which could include progressing its
Bankable Feasibility Study ("BFS") development funding strategy as
well as completion of the planned delisting. The fact that the Loan
is being provided on an unsecured basis by two directors of the
Company who own 34.44% of the Company's issued share capital in
aggregate emphasises the continued support from the Company's Board
to capitalise the Company in a non dilutive manner whilst the
Project development and other funding solutions are progressed
before the end of Q2 2023. We believe the terms of the Loan to be
fair given no other viable funding solutions are available to the
Company in the required timeframe and that those funding solutions
that were evaluated were on more disadvantageous terms. The Loan is
unsecured and ranks behind the existing shareholder loans which are
still being restructured."
Background
Solgenics has been running a development funding process to
raise capital to fund both the Project BFS and cover working
capital costs during the BFS programme. To date, the Company has
received multiple expressions of interest from potential funders
including Development Funding Institutions ("DFI's") and
Independent Power Producers ("IPP's"), and it is the Company's
intention to finalise a preferred development funding partner
before the end of June 2023.
In addition, on 3 May 2023, the Company announced its intention
to delist the Company by 7 June 2023 in order to, amongst other
things, materially reduce the Company's overhead and working
capital requirements.
The Loan is intended to cover working capital costs to progress
the BFS and long-term working capital funding solutions and cover
delisting costs.
Loan key terms
Agreement has been reached with Non-Executive Chairman, Michael
Haworth, and Lowry Trading Limited ("Lowry"), a UK company
controlled by Non-Executive Director, Scott Fletcher, (together,
the "Lenders") to provide the Loan to cover delisting costs and
working capital up to the end of Q2 2023.
The Loan key terms are as follows:
-- Up to US$230,000 loan facility
o US$150,000 from Lowry
o US$80,000 from Michael Haworth
-- Coupon: 30%
-- Maturity: 30 July 2023
o Right to extend maturity to 30 September 2023 subject to the
Company agreeing with the Lenders that genuine third-party offers
have been received for further Project development funding to fund
Project development costs and/or cover working capital.
-- Event of Default: coupon increases to 100%
-- Security: Unsecured
-- Availability: Drawdowns require consent prior to the
extension of the existing shareholder Loan.
No other viable funding solutions are available to the Company
in the required timeframe and those funding solutions that were
evaluated were on more disadvantageous terms. The Loan is unsecured
and ranks behind the existing shareholder loans which are still
being restructured.
Related Party Transactions
The participations of Michael Haworth, being a Director of the
Company, and Lowry, being a company controlled by Scott Fletcher, a
Director and a Substantial Shareholder of the Company, in the Loan
constitute related party transactions for the purposes of the AIM
Rules for Companies. Accordingly, Hanno Pengilly and Aman Sachdeva,
Chief Executive Officer and Non-Executive Director respectively,
acting in their capacities as independent directors for the
purposes of the related party transactions, consider, having
consulted with Liberum Capital Limited, the Company's Nominated
Adviser, the terms of the Loan and the participation of Michael
Haworth and Lowry in the Loan to be fair and reasonable insofar as
the Company's shareholders are concerned.
Enquiries
For further information please visit www.solgenics.com or
contact:
Solgenics: Hanno Pengilly +27 (0) 71 362 3566
Liberum Capital Limited: Scott Mathieson, Edward Thomas, +44 (0) 20 3100
NOMAD & Joint Broker Kane Collings 2000
Novum Securities
Limited +44 (0) 20 7399
Joint Broker Colin Rowbury 9427
Pimlico Advisory
Ltd +44 (0) 777 56 55
Investor Relations Elizabeth Johnson 927
This announcement contains inside information for the purposes
of Article 7 of Regulation (EU) No 596/2014 which is part of UK law
by virtue of the European Union (Withdrawal) Act 2018. Upon
publication of this Announcement and such information is now
considered to be in the public domain. The person who arranged for
the release of this announcement on behalf of the Company was Hanno
Pengilly, CEO.
About Solgenics
Solgenics is an African renewable energy development company
focused on the development of a 300MW solar PV plus BESS renewable
energy plant in the Tete Province in northern Mozambique (the "Tete
Solar Project").
It is the intention that the Tete Solar Project will connect to
the Mozambique grid with target power offtakers in Mozambique and
the Southern African Power Pool ("SAPP").
The Tete Solar Project takes full advantage of Mozambique's
leading sustainable energy resources and is fully aligned with
Government's objective to become a champion for energy transition
impacting all Southern Africa.
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END
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