REG - Kibo Energy PLC - Term Sheet Termination, Funding & Loan Agreement

Kibo EnergyAnnouncement

03/12/2024 07:00

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RNS Number : 5050O  Kibo Energy PLC  03 December 2024

Kibo Energy PLC (Incorporated in Ireland)

(Registration Number: 451931)

(External registration number: 2011/007371/10)

LEI Code: 635400WTCRIZB6TVGZ23

Share code on the JSE Limited: KBO

Share code on the AIM: KIBO

ISIN: IE00B97C0C31

('Kibo' or 'the Company')

 

Dated: 03 December 2024

Kibo Energy PLC ('Kibo' or the 'Company')

 

Termination of Term Sheet, Signing of Loan Agreement and Deed of Amendment to
RiverFort Loan

 

Kibo Energy PLC (AIM: KIBO; AltX: KBO), the renewable energy-focused development company, announces that it has terminated the Term Sheet for the proposed Reverse Takeover of the Company (the "RTO") as announced in the Company's RNS of 16 September 2024 by mutual agreement with ESTGI AG (the "Vendor") effective 02 December 2024. The Company has taken this decision as it believes that, it does not now have sufficient time to secure all relevant information in a timely manner necessary to complete the RTO particularly noting the Company will have been suspended for 6 months on 31 December 2024. The Company will now instead focus on completing and publishing its audited accounts to 31 December 2023 and interim accounts to 30 June 2024 which are well advanced, and the Company expects will be published on or before 31 December 2024. This should then enable the Company's current suspension from trading on AIM to be lifted. Following resumption of trading, the Company will seek an alternative project portfolio to proceed with a revised transaction (the "Revised Transaction"). The Company is already evaluating a number of project acquisition opportunities in this regard and will update the market in due course.

 

In order to fund the Company while it identifies an alternative transaction,
it is pleased to announce that the Company has signed an unsecured loan
agreement (the "Loan Agreement" or "Facility") with Aria Capital Management
Limited (the "Lender" or "Aria"), the Arranger of the Reverse Takeover of the
Company (the "RTO") as announced in the Company's RNS of 16 September 2024.
The Facility provides for drawdowns in multiple traches, the amount of each
tranche to be mutually agreed between Lender and Borrower, up to £500,000 in
aggregate by the Company to be used for working capital purposes over the next
four months to keep the Company in good standing until it is able to identify
and complete a Revised Transaction and to fund initial costs in this regard.

 

Summary of Facility Terms

 

·    Comprises a facility for drawdown of up to £500,000 from the signing
date of the Loan Agreement (being 02 December 2024) up to and including 31
March 2025 (the "Availability Period").

 

·    Drawdowns under the Facility shall be used to fund the initial costs
of an RTO once identified and announced and /or the working capital of the
Company as agreed from time to time between Aria and the Company and may be
drawn down in multiple tranches of no more than £500,000 in aggregate during
the Availability Period, each tranche to be mutually agreed between Lender and
Borrower, with the period in between drawdowns not being less than 30 days.
The initial drawdown, required to be provided by Aria within 7 business days
from signing, is being agreed by the Company and is expected to be received
shortly.

 

·    Repayment of the outstanding balance on the Facility will be on the
Repayment Date defined as the earlier of 31 March 2025 or the date on which
the Company's suspension on AIM is lifted coinciding with the completion of
the Revised Transaction. Repayment will be at the election of the Lender in
any combination of cash and/or newly issued ordinary shares in the Company at
a price per share of £0.000120 being the last closing price of the Company's
shares on AIM prior to the Company being suspended from trading on AIM on 1
July 2024.

 

·    Funds drawn down under the Facility shall bear interest at a rate of 3% per annum and an arrangement fee of £500 is payable to the Lender, at the election of the Company in either new ordinary shares of the Company or in cash.  Failure to make settlement of all outstanding amounts on the Repayment Date by the Company will incur an interest charge of 10% per annum above the base rate of the Bank of England and accrue daily.

 

·    The Facility had been subordinated to an existing facility between
the Company and RiverFort Global Opportunities PCC Limited ("RiverFort") dated
16 February 2022 as amended on 30 September 2024 (the "RiverFort Loan"), and
grants RiverFort third party rights with respect to the enforcement of such
subordination rights. Such subordination rights granted to RiverFort do not
apply where the Facility is settled by way of share conversion (i.e.
subordination rights only apply to cash settlements).

 

·    The Loan Agreement is subject to standard conditions covering a loan
of this type with regard to mutual Representation and Warranties, Covenants
and Events of Default & Remedies.

 

RiverFort Loan Amendment

As required under the terms of the RiverFort Loan, the Company has sought and
obtained permission from RiverFort to avail of the Facility. The terms under
which this permission is granted by RiverFort are recorded in another deed of
amendment to the RiverFort Loan that has been signed between RiverFort and the
Company on 02 December 2024 (the "RiverFort December Deed of Amendment" or the
"Deed"). The summary terms of the RiverFort December Deed of Amendment are as
follows:

 

·    The outstanding balance on the RiverFort Loan will be reduced by the
payment of £20,000 (the "Partial Repayment") by the Company to £329,787.10
(the "Remaining Balance") which will accrue interest at a daily rate of 10%
per annum. The Partial Repayment is due within 3 trading days from the date of
receipt of the first drawdown from the Aria Facility.

 

·    If the first drawdown under the Facility has not occurred within 21
days of the date of the Deed, RiverFort may terminate the Deed and the consent
provided by RiverFort pursuant to the Deed will automatically lapse with
effect from the date of the Deed. Accordingly, any drawdown (or receipt of a
prior drawdown) under the Facility following the date of termination will
constitute an Event of Default (as provided under the terms of the RiverFort
Loan).

·    Legal cost of £2,500 will be charged by RiverFort to cover their
legal costs in the negotiation of the RiverFort December Deed of Amendment and
this charge will be paid on the earlier of (a) the date of the Partial
Repayment being settled and (b) 60 days from the date of this Deed.

 

·    The Remaining Balance and accrued interest will be repayable on the
earlier of the completion of a Revised Transaction (including subsequent
re-admission of the enlarged share capital to AIM) or 30 June 2025.

 

·    Riverfort will enjoy the same conversion rights on the Remaining
Balance as Aria enjoys under the terms of the Facility i.e. repayment will be
at the election of RiverFort in any combination of cash and/or newly issued
ordinary shares in the Company at a price per share of £0.000120 being the
last closing price of the Company's shares on AIM prior to the Company being
suspended from AIM on 1 July 2024 (the "RiverFort Conversion Rights").

 

·    RiverFort may reject any mandatory conversion rights if either (a)
the fundraise for the Revised Transaction is below £5,000,000 (five million
GBP); or (b) the enlarged market capitalization post-closing of a Revised
Transaction (or RTO) is less than £20,000,000 (twenty million GBP); and any
shares issued to the Noteholders resulting from such a conversion will not be
subject to any lock-up or trading restrictions.

 

·    the Facility is subordinated to the RiverFort Loan and grants
RiverFort third party rights with respect to the enforcement of such
subordination rights.

 

·    Any changes to the Facility will require the prior written permission
of RiverFort.

 

Cobus van der Merwe, Interim CEO of Kibo said: "The Company is pleased that it
has successfully secured the Facility with Aria which will greatly assist in
keeping the company in good standing whilst pursuing alternative
opportunities. We would also like to thank RiverFort for their ongoing support
in allowing the Company to obtain the Facility. The Company is appreciative of
both RiverFort and Aria's support which has been instrumental in assisting the
company with its restructuring objectives."

 

This announcement contains inside information as stipulated under the Market
Abuse Regulations (EU) no. 596/2014.

 

**ENDS**

 

For further information please visit www.kibo.energy (http://www.kibo.energy/)
or contact:

 

 Cobus van der Merwe  info@kibo.energy (mailto:info@kibo.energy)  Kibo Energy PLC                        Chief Executive Officer
 James Biddle         +44 207 628 3396                            Beaumont Cornish Limited               Nominated Adviser

 Roland Cornish
 Claire Noyce         +44 20 3764 2341                            Hybridan LLP                           Joint Broker
 James Sheehan        +44 20 7048 9400                            Global Investment Strategy UK Limited  Joint Broker

 

Beaumont Cornish Limited ('Beaumont Cornish') is the Company's Nominated
Adviser and is authorised and regulated by the FCA. Beaumont Cornish's
responsibilities as the Company's Nominated Adviser, including a
responsibility to advise and guide the Company on its responsibilities under
the AIM Rules for Companies and AIM Rules for Nominated Advisers, are owed
solely to the London Stock Exchange. Beaumont Cornish is not acting for and
will not be responsible to any other persons for providing protections
afforded to customers of Beaumont Cornish nor for advising them in relation to
the proposed arrangements described in this announcement or any matter
referred to in it.

 

Johannesburg

03 December 2024

Corporate and Designated Adviser

River Group

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