TIDMAMTE
RNS Number : 0320D
AMTE Power PLC
17 October 2022
THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION FOR THE PURPOSES
OF ARTICLE 7 OF THE UK VERSION OF REGULATION (EU) NO 596/2014 WHICH
IS PART OF UK LAW BY VIRTUE OF THE EUROPEAN UNION (WITHDRAWAL) ACT
2018, AS AMED. UPON THE PUBLICATION OF THIS ANNOUNCEMENT VIA A
REGULATORY INFORMATION SERVICE, THIS INSIDE INFORMATION IS NOW
CONSIDERED TO BE IN THE PUBLIC DOMAIN.
For immediate release
17 October 2022
AMTE Power Plc
Proposed GBP5 million convertible bond facility
Introduction
AMTE Power Plc (AIM: AMTE) ("AMTE Power", the "Company" and
together with its subsidiary undertakings, the "Group"), a leading
developer and manufacturer of lithium-ion and sodium-ion battery
cells for specialist markets, today announces that it has signed
non-binding heads of terms (the "Heads of Terms") to enter into a
proposed GBP5 million convertible bond facility (the "Proposed
Facility") with Arena Investors, LP (together with its affiliates,
"Arena").
The Proposed Facility follows the recent signing of a production
contract with the UK Battery Industrialisation Centre ("UKBIC"),
announced on 6(th) October 2022, for the Company's six minute
re-chargeable Ultra High Power cells, and it is expected that the
Proposed Facility would give the Company the financial capability
to secure and execute on production contracts for both these, and
other cells to be produced at Thurso. The Proposed Facility would
also provide general working capital for the Group into the second
quarter of 2023, at which point it anticipates producing cells
under customer production contracts at the UKBIC.
Use of funding
Further to the uses outlined in the paragraph above, the
Proposed Facility would also be used to enable the Group to:
-- conclude the development for initial commercialisation of
each of its core cells: the Ultra High Power, the Ultra Safe and
the Ultra Prime; and
-- meet the operating costs and capital expenditure required to
produce and sell into the Company's target markets:
o the Ultra High Power cell, which is expected to commence
commercial production at the UKBIC in early 2023;
o the Ultra Safe cell, which is expected to commence commercial
production at Thurso in 2023; and
o the Ultra Prime cell, which is expected to be produced for
initial supply in 2023, with commercial production anticipated at
Thurso in 2024.
Details of the Proposed Facility
Under the Heads of Terms[1], Arena would provide an interest
free, unsecured bond facility to the Company for a total amount of
up to GBP5 million, available for drawdown in three tranches: GBP3
million on completion of the Proposed Facility and two further
tranches of GBP1 million each at least 60 days following drawdown
of the previous tranche, provided that no more than GBP4 million is
outstanding under the Proposed Facility at the relevant time. The
subscription price payable by Arena would amount to 92 per cent. of
the principal value of each tranche. It is further anticipated that
the Company would pay an upfront fee equal to 3 per cent. of the
Proposed Facility which would be deducted from the first drawdown
tranche.
Arena would be entitled to convert outstanding amounts (in
minimum instalments of GBP150,000) under the Proposed Facility into
new ordinary shares of 0.5 pence each in the capital of the Company
("Ordinary Shares"), at a price per share equal to 95 per cent. of
the 3-lowest daily volume weighted average prices over a 15-trading
day look back period ("VWAP") prior to the date of its conversion
notice. Any amounts not so converted would become repayable on the
second anniversary of drawdown.
Arena would be unable to convert any amounts outstanding under
the Proposed Facility where such conversion would mean that it
would become interested (as defined in the City Code on Takeovers
and Mergers (the "Takeover Code")) in more than 29.9 per cent. of
the Ordinary Shares, save in circumstances where such conversion is
conditional upon the Company's independent shareholders waiving the
obligation on Arena to make a mandatory bid for the remaining
Ordinary Shares under Rule 9 of the Takeover Code.
In addition, Arena would be entitled to receive warrants,
exercisable until the third anniversary of the Proposed Facility,
to subscribe for GBP1.5 million of new Ordinary Shares at a price
of 82.04 pence per Ordinary Share, representing a premium of 20 per
cent. to the VWAP on 14 October 2022.
The Proposed Facility would be capable of redemption in cash at
any time by the Company at 115 per cent. of the principal amount
then outstanding.
It is expected that the Proposed Facility will contain certain
covenants, representations and warranties and events of default
typical for a facility of this type and size.
Under the Heads of Terms, the Company has agreed, subject to
limited exceptions, not to solicit, accept or encourage any other
debt or convertible financing proposal with respect to the Proposed
Facility for a period of 60 days following the entry into the Heads
of Terms. Further, the Company, in the event of breaching such
exclusivity provision, shall pay Arena's costs and expenses.
It is intended that definitive and legally binding contractual
documentation (the "Definitive Documents"), incorporating the
summary terms referenced above, will be entered into as soon as
reasonably practicable. Further, the entry into Definitive
Documents is conditional upon, amongst other things, the conclusion
of due diligence satisfactory to Arena, there being no material
adverse change to the Group and Arena remaining satisfied with the
financial performance of the Company, the Company's shareholders
approving certain shareholder resolutions (the "Resolutions")
required to implement the Proposed Facility at a general meeting of
shareholders (the "General Meeting") and other conditions which are
customary for a facility of this type.
Accordingly, there can be no guarantee that the Definitive
Documents will be entered into or that the Proposed Facility
becomes unconditional in which event the Company would not receive
the funding under the Proposed Facility.
The Proposed Facility will provide funds for the Group as
outlined above and will supersede alternative funding options which
the Group has been exploring to support its growing commercial cell
production requirements.
Shareholder approval and importance of the vote
In order to provide the Company with the flexibility to be able
to enter into Definitive Documents as soon as possible, the Company
proposes to despatch a shareholder circular (the "Circular")
containing details of the Proposed Facility and convening the
General Meeting in order to pass the Resolutions, on or around 17
October 2022. The Circular, once published, will be available on
the Company's website at www.amtepower.com/investors.
Shareholders should be aware that, if for any reason (including
the Resolutions not being passed at the General Meeting), the
Definitive Documents in respect of the Proposed Facility are not
entered into or the Proposed Facility does not become
unconditional, the Company would need to consider the options
available to it in terms of alternative sources of funding. It may
be that such sources would not be available or available on
favourable terms. Accordingly, if alternative sources of funding
anticipated by the Board could not be secured, the Company expects
that it would not have sufficient cash for its current level of
activities beyond November 2022.
The person responsible for arranging the release of this
announcement on behalf of the Company is James Hobson Chief
Financial Officer of the Company.
Enquiries:
AMTE Power plc +44 (0)1847 867 200
Kevin Brundish (Chief Executive Officer)
James Hobson (Chief Financial Officer)
WH Ireland Limited - Nominated Adviser
and Joint Broker +44 (0)207 220 1666
Chris Fielding / James Bavister / Ben Good
(Corporate Finance)
Fraser Marshall (Corporate Broking)
Panmure Gordon (UK) Limited - Joint Broker +44 (0)207 886 2500
John Prior / James Sinclair-Ford / Soman
Thakran (Corporate Finance)
Hugh Rich (Corporate Broking)
Camarco - Public Relations Adviser +44 (0)20 3757 4992
Ginny Pulbrook / Rosie Driscoll
Notes to Editors:
AMTE Power was founded in 2013 and is a leading developer and
manufacturer of lithium-ion and sodium-ion battery cells for
specialist markets. In March 2021, the Company was admitted to
trading on the AIM market of the London Stock Exchange. The Company
is focused on launching a series of next generation battery cells
based on new chemistries and cell structures that are designed to
solve key problems in power delivery, energy performance, and
safety. These new products are targeted at a range of specialist
markets including the electric vehicle industry and energy storage
sector.
AMTE Power's purpose-built cell manufacturing facility in
Thurso, Scotland has the second largest cell manufacturing capacity
in the UK and the Company also has a product development team based
in Oxford. Amte Power's proposed state-of-the-art MegaFactory in
Dundee, Scotland is expected to be operational and in production by
Q3 2025 and be capable of producing over 25,000 high added value
batteries per day enabling the Company to rapidly scale up cell
production.
For further information visit the Company's website:
www.amtepower.com .
Information on Arena
Arena is an institutional asset manager founded in partnership
with The Westaim Corporation (TSXV: WED). With $3.6 billion of
invested and committed assets under management as of August 1,
2022, and a team of over 100 employees in offices globally, Arena
provides creative solutions for those seeking capital in special
situations. The firm brings individuals with decades of experience,
a track record of comfort with complexity, the ability to deliver
within time constraints, and the flexibility to engage in
transactions that cannot be addressed by banks and other
conventional financial institutions. See www.arenaco.com for more
information.
[1] Which are non-binding save in respect of exclusivity,
expenses, governing law, confidentiality and indemnification.
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