Conditional Agreement to Repay Loan Facility

RNS Number : 7444R

Invinity Energy Systems PLC

03 March 2023

 

The information contained within this Announcement is deemed by Invinity Energy Systems plc to constitute inside information as stipulated under the Market Abuse Regulation (EU) No. 596/2014 as it forms part of UK law by virtue of the European Union (Withdrawal) Act 2018 ("MAR").

3 March 2023

Invinity Energy Systems plc

("Invinity" or the "Company")

Conditional Agreement to Repay Convertible Loan Facility

Invinity Energy Systems plc (AIM: IES) (AQSE: IES) (OTCQX: IESVF), a leading global manufacturer of utility-grade energy storage , is pleased to announce that it has entered into a prepayment agreement ("Repayment Agreement") to repay the outstanding drawn amount of the convertible loan facility (the "Facility") with RiverFort Global Opportunities PCC Ltd and YA II PN Ltd. (together the "Noteholders") which was announced on 14 December 2022.

Under the terms of the Facility, an initial amount of US$2,500,000 ("Initial Advance") was drawn of which US$2,081,075.32 remains outstanding ("Outstanding Drawn Amount"). Under the Repayment Agreement, the Noteholders have agreed that the restrictions for prepaying the Initial Advance (as set out in the announcement of the Facility on 14 December 2022) will not apply and in accordance with the Facility the Company has agreed to settle the Outstanding Drawn Amount together with the redemption premium of 10% (US$208,107.53) (the "Redemption Premium"). The repayment of the Outstanding Drawn Amount and the Redemption Premium is conditional on the completion of the Placing and Open Offer. In the meantime the Noteholders have agreed that they will not issue any further conversion notices.

Pursuant to the Facility, on 14 December 2022 the Noteholders were granted warrants exercisable at 67.35p to subscribe for 1,350,020 ordinary shares for a period of up to four years (the "Existing Warrants"). In accordance with the terms of the warrant instrument, the Company is required to amend the exercise price of these warrants to 32p, being the issue price of the recently announced Placing and Open Offer. In consideration of the Noteholders undertakings pursuant to the Repayment Agreement, the Company has, conditional on the completion of the Placing and Open Offer, agreed to grant a further 449,980 warrants at an exercise price of 32p which will expire on 14 December 2026 (being the same date as the Existing Warrants).

As part of the Facility, 2,700,038 ordinary shares were issued to the Noteholders (the "Initial Shares") to effect initial conversions relating to the Initial Advance. To the extent that the Noteholders still held Initial Shares after the Facility had been repaid in full, the shares would be sold by the Noteholders with the relevant net proceeds remitted to the Company. As at the date of this announcement 1,779,640 of the Initial Shares are remaining and held by the Noteholders. So as to ensure an orderly market, the Company and the Noteholders have agreed that for a period of 24 months from the date of the Repayment Agreement these remaining shares may only be sold following instruction from the Company, since 97% of the net proceeds are to be remitted to the Company.

In its announcement of 22 February 2023 the Company set out that a minimum Placing of £16 million was sufficient to satisfy the Company's working capital requirements through to the end of H1 2024. On 23 February 2023 the Company announced that the Placing was oversubscribed and subsequently increased to £19 million. The Company is therefore comfortable that the additional £3 million to be received in the Placing combined with the £2.5 million Subscription, the Company's existing cash resources and any proceeds from the Open Offer provide the Company with a robust working capital position. Accordingly, the Company believes it is in shareholders' best interests to commit a proportion of its existing cash resources to the repayment of the Facility as described above. The Company will not however release these funds until completion of the Placing and Open Offer.

By way of a break fee to the Noteholders, should the Placing and Open Offer not complete by 30 April 2023, the Company has agreed that the Redemption Premium will still be payable but in shares at a price equivalent to the average daily VWAP in the 5 days prior to 30 April 2023.

Jonathan Marren, Chief Development Officer and Interim CFO at Invinity said:

"Entering into the Facility in December 2022 supported the significant order backlog and considerable near-term commercial interest Invinity has attracted. This Facility has been an important bridge to the recently announced equity funding through the Placing, Open Offer and strategic investment. We look forward to repaying the Facility and convey our appreciation to Riverfort and YA for assisting Invinity during this period."

Enquiries :

Invinity Energy Systems plc	[phone]
Jonathan Marren, Chief Development Officer and Interim CFO Joe Worthington, Director of Communications
Canaccord Genuity (Nominated Adviser and Joint Broker)	[phone]
Henry Fitzgerald-O'Connor / Harry Pardoe / Gordon Hamilton
VSA Capital (Financial Adviser and Joint Broker)	[phone]
Andrew Monk / Simon Barton
EAS Advisors LLC (US Corporate Advisor)	[phone]
Matthew Bonner / Chris Chesworth

Notes to Editors

Invinity Energy Systems plc (AIM: IES) (AQSE: IES) (OTCQX: IESVF) manufactures vanadium flow batteries for large-scale, high-throughput energy storage requirements of business, industry and electrical networks.

Invinity's factory-built flow batteries run continually with no degradation for over 25 years, making them suitable for the most demanding applications in renewable energy production. Energy storage systems based on Invinity's batteries are safe, reliable, and economical, and range in size from less than 250 kilowatt-hours to tens of megawatt-hours.

Invinity was created in April 2020 through the merger of two flow battery industry leaders: redT energy plc and Avalon Battery Corporation. With over 65 MWh of systems already deployed or contracted for delivery across over 70 sites in 15 countries, Invinity is active in all major global energy storage markets and has operations in the UK, Canada, USA, China and Australia. Invinity Energy Systems plc is listed in the UK on AIM and AQSE and trades in the USA on OTCQX.

To find out more, visit invinity.com or call Investor Relations on [phone].

 

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