Deed of Amendment and Notice of Results
02/12/2020 07:00
RNS Number : 1922H
Real Good Food PLC
02 December 2020
2 December 2020
Real Good Food plc
("RGF" or the "Group")
Extension to Redemption Dates, Related Party Transactions and Notice of Results
The Company announces today that, following negotiations with the Company's three major shareholders, NB. Ingredients Limited ("Napier Brown"), Omnicane International Investors Limited ("Omnicane"), and certain funds managed by Downing LLP ("Downing") (together the "Major Shareholders"), it has now finalised an amendment deed (the "Amendment Deed") relating to the funding agreements (the "Agreements") set out in the appendix to this announcement.
The Agreements have been amended such that the final repayment dates of each of the Agreements have been extended to 19 May 2022 (the "Final Repayment Date") with no change to the interest rate payable by the Company pursuant to each Agreement.
In addition, the Amendment Deed amends the convertible loan notes ("CLNs") set out in the appendix such that the minimum annual return on the CLNs will reduce from 30% per annum to 12% per annum, effective from 31 December 2020. Amounts due in respect of the period up to, and including, 31 December 2020 remain unchanged. For avoidance of doubt, the redemption premium on the Loan Notes instruments set out in the appendix remains payable at 15%.
As part of entering into the Amendment Deed the Company has undertaken that it will not to enter into any transaction (or transactions in aggregate) that would result in a fundamental change of business of the Company without the prior consent of each of the Major Shareholders. This obligation would cease in the event of the repayment of the outstanding facilities with the Major Shareholders.
Related Party Transactions
As Napier Brown and Omnicane are substantial shareholders of the Company and Judith MacKenzie, a director of the Company, is also a Partner of Downing, the Amendment Deed is deemed to be a related party transaction pursuant to the AIM Rules for Companies. Maribeth Keeling, Mike Holt, and Gail Lumsden, the Independent Directors of the Company for this purpose, having consulted with the Company's Nominated Adviser, finnCap Ltd, consider the terms of the Amendment Deed to be fair and reasonable insofar as the Company's shareholders are concerned.
The information communicated in this announcement is deemed to constitute inside information as stipulated under the Market Abuse Regulations (EU) No. 596/2014. Upon the publication of this announcement, this inside information is now considered to be in the public domain.
Current trading
Since the worst of the COVID impact, and as stated in RGF's AGM trading update issued on 23 September 2020, both the Group's businesses (Brighter Foods and Cake Decorations) have evidenced recovery in their respective markets. Since then, and despite the second COVID lockdown, the Group's trading has continued to recover and both divisions are performing slightly ahead of the Board's "COVID" budget expectations set at the time of the start of the pandemic in March.
Notice of Results
In order to provide enough time to have finalised the extension repayment agreements and deeds, and given the constraints of COVID, the Group now expects to release its Annual Report and Accounts for the year ended 31 March 2020 on 16 December 2020.
Mike Holt, Non-Executive Chairman commented:
"The Board is grateful for the support of its major shareholders in agreeing these amendments, which provide the Group with greater medium-term funding certainty during these challenging times. We continue to believe that both Brighter Foods and Cake Decorations are well placed and valuable businesses in what has been a relatively resilient industry. We will provide a further business update when we issue our annual results on 16 December."
-ENDS-
Enquiries:
| Real Good Food plc Mike Holt, Executive Chairman Maribeth Keeling, Group Finance Director | Tel: 0151 541 3790 |
| finnCap Limited (Nomad and Broker) Carl Holmes / James Thompson (Corporate Finance) | Tel: 020 7220 0500 |
| MHP Communications (Financial PR) Reg Hoare / Katie Hunt | Tel: 020 3128 8100 rgf@mhpc.com |
| About Real Good Food Real Good Food plc is a food manufacturing business serving several market sectors including retail (own label and private label), manufacturing and export. The Group has two businesses, Cake Decoration (Renshaw and Rainbow Dust Colours) and Food Ingredients (Brighter Foods), with leading brands in their chosen markets. | |
| Agreement | Counterparty | Loan Principal (£) |
| Downing first Loan Note Instrument | Downing | 6,149,054 |
| Napier Brown First Loan Agreement | Napier Brown | 1,330,811 |
| Omnicane First Loan Agreement | Omnicane | 1,331,955 |
| Napier Brown Unsecured Loan Agreement | Napier Brown | 375,000 |
| Omnicane Unsecured Loan Agreement | Omnicane | 375,000 |
| Downing Chattel Loan Agreement | Downing | 900,000 |
| Downing Chattel Loan Agreement | Downing | 433,333 |
| Napier Brown Chattel Loan Agreement | Napier Brown | 900,000 |
| Napier Brown Chattel Loan Agreement | Napier Brown | 433,333 |
| Omnicane Chattel Loan Agreement | Omnicane | 500,000 |
| Omnicane Chattel Loan Agreement | Omnicane | 500,000 |
| Omnicane Chattel Loan Agreement | Omnicane | 333,333 |
| Unsecured Loan Note Instrument | Napier Brown | 1,285,000 |
| Unsecured Loan Note Instrument | Omnicane | 1,285,000 |
| Unsecured Loan Note Instrument | Downing | 151,571 |
| Unsecured Loan Note Instrument | Downing | 169,722 |
| Unsecured Loan Note Instrument | Downing | 108,707 |
| Unsecured B Loan Note Instrument | Napier Brown | 856,666 |
| Unsecured B Loan Note Instrument | Napier Brown | 856,666 |
| Unsecured B Loan Note Instrument | Omnicane | 856,666 |
| Unsecured B Loan Note Instrument | Omnicane | 856,666 |
| Unsecured B Loan Note Instrument | Downing | 286,668 |
| Unsecured B Loan Note Instrument | Downing | 286,668 |
| TOTAL | 20,561,819 | |
| Convertible Loan Note | Napier Brown | 3,400,899 |
| Convertible Loan Note | Omnicane | 3,400,899 |
| Convertible Loan Note | Downing | 2,004,774 |
| TOTAL | 8,806,571 |
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