Altech - Share Purchase Agreement
Perth, April 22, 2020 AEST (ABN Newswire) - Altech Chemicals Limited (
ASX:ATC) (A3Y:FRA) is pleased to announce that it has executed a share purchase subscription agreement (the Agreement) with Specialty Materials Investments LLC (SMI), a U.S.-based institutional specialist investor.
The Agreement provides for SMI to subscribe for up to $2 million in Altech shares (Initial Investment), and subject to shareholder approval, up to an additional $981,000.
Highlights
- Share placement to Specialty Materials Investments LLC, a specialist U.S. institutional investor
- Initial investment of up to $2 million
- Additional investment of up to $0.9 million, subject to shareholder approval
- Funding certainty for Altech's European initiatives o Focus on the "new economy", post COVID-19
A $200,000 initial payment and subscription will be made by SMI in the coming days, which will represent a prepayment for Altech shares (for shares with a subscription value of $218,000) that will be issued to SMI, at SMI's request, within 12 months of the date of the payment. Up to eight additional payments/subscriptions of $200,000 each (for shares with a subscription value of $218,000 each) are then scheduled to be made by SMI, approximately monthly. Any of these subsequent tranches may be increased to up to $300,000 (for shares with a subscription value of $327,000), but only with the consent of the Company. The aggregate amount of the Initial Investment will not exceed $2,000,000, and as per the first $200,000, each subsequent payment made by SMI will represent a prepayment for Altech shares, to be issued at SMI's request within 12 months following the date of each subsequent tranche.
Additionally, following the investments referenced above, SMI will make a further three (3) payments/subscriptions approximately monthly on the same terms (for up to an additional $981,000 of Altech shares), but only subject to shareholders' approval for such investment.
The number of Altech shares to be issued to SMI for each tranche will be determined by dividing each subscription value (or that part thereof in relation to which the shares are being issued) by, at SMI's election: (i) $0.0628, being 140% of the average of the daily volume-weighted average price for the 20 trading days prior to the date of execution of the Agreement (which may only be utilised in respect of tranches with an aggregate subscription value of $400,000); or (ii) 90% of the prevailing Altech share price, being the average of the five daily volume-weighted average price during a specified period immediately prior to the date of issue of the shares.
Altech has the right to terminate the Agreement at any time following receipt of the second subscription.
SMI will receive a fee in connection with its investment in the Company, to be satisfied by way of issuance of 4,219,409 Altech shares. The Company's obligations under the Agreement will be secured against 4.8 million shares.
Funds received under the Agreement will be primarily used for Altech's ongoing corporate activities, which are intended to position the Company's high purity alumina (HPA) project for more stable financial markets and anticipated economic stimulus measures post the current COVID-19 situation (refer ASX announcement of 25 March 2020).
Early indications as to possible European fiscal stimulus post COVID-19 is that manufacturing stimulus could be weighted more towards the evolving "new economy", and may likely preference "carbon light" technology such as electric vehicles, green energy storage and renewables, as opposed to twilight "carbon heavy" technology such as internal combustion engine vehicle manufacture and like or associated sectors. Altech's HPA project is strongly aligned to the new, green economy due to HPA's use as a coating material within lithium-ion batteries and as the non-substitutable raw material for the manufacture of synthetic sapphire, a substrate material for the production of energy efficient light emitting diodes (LED's).
In relation to the funding agreement with SMI, Altech managing director Iggy Tan said "the support of SMI for the Company and our HPA project during this challenging funding environment is a tremendous endorsement of our project and the potential opportunity for us post COVID-19.
Altech alternate director Uwe Ahrens and Altech Advanced Materials AG director Hanjoerg Plaggemars continue to promote Altech and our HPA project in Germany and provide us with the most up to date information about the very fluid business environment both in Germany and across Europe generally. Despite various COVID-19 restrictions that are in place, Uwe and Hansjoerg have been able to continue with important meetings and maintain and build their respective networks of various potential investors, battery materials and automotive industry participants."
About Altech Batteries Ltd
Altech Batteries Limited (ASX:ATC) (FRA:A3Y) is a specialty battery technology company that has a joint venture agreement with world leading German battery institute Fraunhofer IKTS ("Fraunhofer") to commercialise the revolutionary CERENERGY(R) Sodium Alumina Solid State (SAS) Battery. CERENERGY(R) batteries are the game-changing alternative to lithium-ion batteries. CERENERGY(R) batteries are fire and explosion-proof; have a life span of more than 15 years and operate in extreme cold and desert climates. The battery technology uses table salt and is lithium-free; cobalt-free; graphite-free; and copper-free, eliminating exposure to critical metal price rises and supply chain concerns.
The joint venture is commercialising its CERENERGY(R) battery, with plans to construct a 100MWh production facility on Altech's land in Saxony, Germany. The facility intends to produce CERENERGY(R) battery modules to provide grid storage solutions to the market.
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