REG - PipeHawk PLC - Convertible Unsecured Loan Stock Update

PipehawkAnnouncement

26/09/2024 16:00

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RNS Number : 8706F  PipeHawk PLC  26 September 2024

26 September 2024

PipeHawk plc

("PipeHawk", "Company" or the "Group")

 

Update in relation to Convertible Unsecured Loan Stock

 

PipeHawk provides the following update in relation to the Company's £1.0
million convertible unsecured loan stock issued to Gordon Watt, the Chairman
of the Company.

 

Background to the CULS

 

On 13 August 2010, the Company announced, inter alia, the issue of £1.0
million of convertible unsecured loan stock to Gordon Watt (the "CULS"). As
part of the terms and conditions of the CULS, it was agreed that the CULS may
be converted, at the option of Gordon Watt, into new ordinary shares of 1
pence each in the Company (the "Ordinary Shares") at a price of 7 pence per
Ordinary Share at any time prior to 13 August 2014. In addition, the interest
payable on the CULS was set at 10 per cent. per annum on the principal amount
outstanding until converted, prepaid or repaid, calculated and compounded on
each anniversary of the issue of the CULS. On conversion of any CULS, any
unpaid interest would be paid within 20 days of such conversion with the CULS
repayable together with accrued interest on 13 August 2014 (together, the
"2010 CULS").

 

On 14 November 2014, the Company announced that it had extended the repayment
date of the 2010 CULS from 13 August 2014 to 13 November 2018 and changed the
conversion price of the 2010 CULS from 7 pence to 5 pence with all other terms
of the 2010 CULS remaining unchanged (the "2014 Amendments").

 

On 9 November 2018, the Company announced that it had agreed to further extend
the repayment date of the 2010 CULS from 13 November 2018 to 13 August 2022
with all other terms of the 2010 CULS remaining unchanged (the "2018
Amendment").

 

The issue of the 2010 CULS, the 2014 Amendments and the 2018 Amendment were
respectively deemed to be related party transactions pursuant to Rule 13 of
the AIM Rules for Companies (the "AIM Rules") at the time. Accordingly, as
disclosed in each respective announcement outlined above, the independent
directors of the Company, having consulted the Company's nominated adviser at
the time, concluded that the entry into the 2010 CULS, the 2014 Amendments and
the 2018 Amendment to be fair and reasonable insofar as the Company's
shareholders are concerned.

 

2022 amendment to the CULS

 

On 29 November 2022, it was announced by the Company in its final results for
the year ended 30 June 2022, inter alia, that on 30 June 2022 the Company
further extended the repayment date of the 2010 CULS from 13 August 2022 to 13
August 2026, and otherwise on identical terms to the 2018 Amendment (the "2022
Amendment"), including the conversion price of 5 pence.

 

In this regard, the Company has recently become aware of a clerical error made
in:

 

(i)         note 16 to the financial statements for the year ended 30
June 2022 (announced by the Company on 29 November 2022);

(ii)         note 15 to the financial statements for the year ended 30
June 2021(announced by the Company on 3 November 2021); and

(iii)        note 15 to the financial statements for the year ended 30
June 2020 (announced by the Company on 21 October 2020),

 

all of which erroneously referred to a CULS conversion price of 3 pence.  The
same erroneous reference to a 3 pence CULS conversion price was repeated in
the relevant notes to the Company's annual reports for the years ended 30 June
2020, 30 June 2021 and 30 June 2020.

 

The Company can confirm that the CULS conversion price remains at 5 pence,
noting that the 2022 Amendment was stated, in the announcement made by the
Company at the time, to be on identical terms to the 2018 Amendment.

 

The entry by the Company into the 2022 Amendment, namely a further extension
of the CULS repayment date to 13 August 2026, is deemed to be a related party
transaction pursuant to AIM Rule 13. However, the Company's nominated adviser,
Allenby Capital, was not consulted at the time of entering into the 2022
Amendment. In this regard, the Company's current directors independent of the
2022 Amendment, being Robert MacDonnell and Timothy Williams, consider, having
now consulted with the Company's nominated adviser, Allenby Capital, that the
terms of the 2022 Amendment are fair and reasonable insofar as the Company's
shareholders are concerned.

 

-Ends-

 

Enquiries:

 

 PipeHawk plc                                Tel. No. 01252 338 959

 Gordon Watt (Chairman)

 Allenby Capital Limited (Nomad and Broker)  Tel. No. 020 3328 5656

David Hart / Vivek Bhardwaj

 

For further information on the Company and its subsidiaries, please visit:
www.pipehawk.com (http://www.pipehawk.com/)

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