03:00 Wed 01 Apr 2020
K3 Bus Tech Grp PLC - Loan Funding Secured and Update on Subsidiary
AIM: KBT
("K3" or "the Group")
Loan Funding Secured
and
Update on
Further to the announcement released on
As reported in the announcement of 24 March, the announcement of K3's preliminary results for the year ended
Loan Funding
K3 has secured
Barclays is extending its existing loan facilities to K3 by
Kestrel (which has appointed
The main terms of the Shareholder Loan are as follows:
- unsecured and subordinated to all indebtedness with Barclays;
- 8.0% annual coupon, with interest rolling up on a quarterly basis; and
- 1 warrant issued for every
In addition, K3 will pay the underlying clients of Kestrel an arrangement fee of 2.0% of the value of their portion of the Shareholder Loan, and will pay Kestrel the associated costs incurred by it, up to
It is intended that other major institutional shareholders of K3 will be offered the opportunity to participate in further lending of up to
The dilutive impact of the Warrants issued to the Lenders would be to increase K3's issued share capital by 1.2m new Ordinary Shares, representing 2.8% of K3's current issued share capital. This dilution would increase to a maximum of 2.0m new Ordinary Shares, representing 4.7% of the Group's current issued share capital, in the event that the Top-up Facility is subscribed in full.
The Directors believe that the potential dilution arising from the issue of the Warrants is significantly lower than the dilution that would have arisen had K3 attempted to secure this additional financing wholly via an issue of new equity.
Update on
The Group's
As a result, and following independent advice, the Board of the subsidiary has taken the very difficult decision that it will be filing a Notice of Intention for administration. At the same time, it will seek interest in the sale of the business and/or its assets.
It should be noted that this decision has no effect on the Group's
As previously reported on 24 March, the Board will focus on growing the Group's core profitable business units and accelerating the transition towards its own IP, in particular the new flagship Imagine product.
Related Party Transactions
The entering into of the Shareholder Loan by K3 (and the payment of the associated arrangement fee and costs) with Kestrel (and its underlying clients) and
The Independent Directors (being the K3 board, excluding
Further Terms of the Shareholder Loan
The Shareholder Loan is not subject to any financial covenants though each of the Lenders consent will be required in the event that K3 wishes to:
· issue further equity; or
· make any acquisitions; or
· enter into any additional loan facilities.
In the event that K3 fails to repay the Shareholder Loans (including any accrued interest) by
Adalsteinn Valdimarsson, CEO of
"The securing of this additional finance from Barclays and our two major shareholders demonstrates their commitment to K3 and belief in our growth strategy and prospects. The additional liquidity puts us in a much stronger financial position and gives us the headroom to undertake any required restructuring as well as further investment to support our growth strategy."
This announcement contains inside information for the purposes of Article 7 of Regulation 596/2014.
Enquiries:
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Adalsteinn Valdimarsson, CEO
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T: 0161 876 4498 |
finnCap Limited (NOMAD & Broker)
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T: 020 7220 0500 |
KTZ Communications |
Katie Tzouliadis/ |
T: 020 3178 6378 |
1. |
Details of Persons Discharging Managerial Responsibilities "PDMR" / person closely associated with them ('PCA') |
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a) |
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2. |
Reason for notification |
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b) |
Position / status |
Non-executive director |
c) |
Initial notification / amendment |
Initial Notification |
3. |
Details of the issuer, emission allowance market participant, auction platform, auctioneer or auction monitor |
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b) |
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c) |
LEI |
213800QOJ9OF2AV81748 |
4. |
Details of the transaction(s): section to be repeated for (i) each type of instrument; (ii) each type of transaction; (iii) each date; and (iv) each place where transactions have been conducted |
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a) |
Description of the financial instrument
Identification code
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Warrants over ordinary shares of 25p each, exerciseable at nominal value
n/a |
b) |
Nature of the transaction |
Grant of warrants in connection with loan funding arrangement |
c) |
Price(s) and volume(s) |
600,000 warrants
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d) |
Aggregated information Aggregated volume Price |
n/a |
e) |
Date of the transaction |
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f) |
Place of the transaction |
Outside a trading venue |
This information is provided by RNS, the news service of the
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