REG - Webis Holdings PLC - Further Loan advanced by Galloway Limited

Webis HoldingsAnnouncement

18/11/2024 15:45

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RNS Number : 6710M  Webis Holdings PLC  18 November 2024

THE INFORMATION CONTAINED WITHIN THIS ANNOUNCEMENT IS DEEMED BY THE COMPANY TO
CONSTITUTE INSIDE INFORMATION AS STIPULATED UNDER THE MARKET ABUSE REGULATIONS
(EU) NO. 596/2014 AS IT FORMS PART OF UK DOMESTIC LAW BY VIRTUE OF THE
EUROPEAN UNION (WITHDRAWAL) ACT 2018 ("MAR"), AND IS DISCLOSED IN ACCORDANCE
WITH THE COMPANY'S OBLIGATIONS UNDER ARTICLE 17 OF MAR.

 

Webis Holdings PLC

For immediate release
 

18 November 2024

 

Webis Holdings plc

("Webis" or "the Company")

Further Loan advanced by Galloway Limited

Webis Holdings plc, the global gaming group, today announces that it has
agreed a further loan facility (the "Loan") for the sum of US$920,000 with
Galloway Limited ("Galloway"). The purpose of the loan is to (i) refinance the
prior five-year term loan from Galloway to the Company (the "April 2019 Loan")
advanced in 2019 (principal amount US$350,000 plus US$20,000 of accrued
interest), and (ii) support the Company's working capital requirements and
support the operations of its wholly owned subsidiary, WatchandWager.com LLC
("WatchandWager"). WatchandWager operates physical and on-line licenses in the
State of California.

As reported in our interim results to the end of November 2023 the Company
noted that WatchandWager had a poor first 6 months of the financial year in
terms of financial and operational performance. In particular, whilst trading
was in line with expectations during the first quarter of the financial year,
the second quarter did not perform to expectations, largely due to adverse
weather conditions.

Furthermore, as announced by the Company in its update on 26 July 2024,
optimism that trading would improve in line with expectations in the second
half of the year, did not prove to be the case as anticipated improvement in
B2C performance did not happen, exacerbated by unprecedented race meeting
cancellations throughout the US due to weather disruption. Accordingly, the
Company notified shareholders that losses in the second half of the year were
expected to be broadly commensurate with those in the first half.

Given the continued losses suffered by the Company and its subsidiaries,
further funding for the Company is required to continue operations, and to
refinance the April 2019 Loan.

Terms of the Loan

The Loan carries a coupon of 13.0% for a term of five years and is secured
against all the unencumbered assets of Webis. The loan can be drawn down by
the Company at any time during the terms of the Loan.

When the Loan is drawn-down in full, this will bring the total indebtedness of
the Group to Galloway to approximately US$2,880,000 (including accrued
interest). Details of the previous advances (including the Apil 2019 Loan) are
set out below:

 Borrower            Date of Loan    Principal Amount  Interest Rate  Maturity        Other Terms
 Webis Holdings plc  April 2019      USD 350,000*      7%             April 2024*     Secured against unencumbered assets of the Group
 Webis Holdings plc  March 2020      USD 500,000       7%             March 2025      Secured against unencumbered assets of the Group
 Webis Holdings plc  September 2023  GBP 1,150,000     11%            September 2028  Convertible into ordinary shares (i) on completion of an equity fundraising of

                                                                                    at least £750,000, at the price applicable to that equity fundraising, (ii)
                                                                                      on a change of control of the Company, at the price applicable to that change
                                                                                      of control, (iii) at the election of Galloway, at the higher of (i) £0.0156
                                                                                      or the 20 day VWAP of the Company's shares on the business day immediately
                                                                                      prior to the date of conversion, or (iv) if not converted earlier, on the
                                                                                      maturity date at £0.0156

*This loan, together with outstanding interest, has been refinanced by the
Company and Galloway, with sums outstanding included within the new US$920,000
loan facility.

Related Party Transaction

Jim Mellon, a Non-Executive Director of the Company is the ultimate beneficial
owner of Galloway. Further, Denham Eke, the Non-Executive Chairman of Webis,
is a director of Galloway and Katie Errock, a Non-Executive Director of the
Company, is the Company Secretary of Burnbrae Group Limited, which is the
indirect owner of Galloway. Galloway is a 63.1 per cent. shareholder in Webis.
Accordingly, Galloway is a Related Party of the Company and therefore the Loan
is a Related Party Transaction under the AIM Rules. Accordingly, the
independent Directors (being Ed Comins and Richard Roberts), having consulted
with the Company's Nominated Adviser, confirm that they consider the terms of
the Loan, and the roll-up of the April 2019 Loan following its maturity on the
same terms, fair and reasonable in so far as all Webis' shareholders are
concerned.

Ed Comins, Managing Director of Webis, stated:

"Webis is very pleased to receive further backing from our principal
shareholder. Their continued support during a period of poor trading is vital
for the Company and the terms compare favourably with other potential forms of
funding considered."

For further information:

 

 Webis Holdings plc         Tel:  01624 639396
 Denham Eke / Ed Comins
                            Tel:  020 7628 3396

 Beaumont Cornish Limited
 Roland Cornish / James Biddle

 

Nominated Adviser

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.

 

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