£1.1m Fundraise, Retail Offer & Debt Conversion

Conversion of debt into equity by significant shareholders

Repayment of debt balances

EQTEC plc (AIM: EQT), a global technology innovator powering distributed, decarbonised, new energy infrastructure through its waste-to-value solutions for hydrogen, biofuels, and energy generation is pleased to announce it has raised, in aggregate, £1.1 million before expenses by way of a £1 million placing (the "Placing"), and a subscription of £100,000 (the "Subscription"), to new and existing institutional and other investors for, in aggregate, 110,000,000 new ordinary shares of €0.01 each in the capital of the Company ("Ordinary Shares") (together, the "Fundraise Shares") at a price of 1 pence per new Ordinary Share (the "Issue Price").

In addition, the Company is launching a separate retail offer to existing retail investors via the Winterflood Retail Access Platform ("WRAP") platform to raise up to £0.2 million at the Issue Price (the "WRAP Retail Offer").

The net proceeds of the Placing, Subscription and WRAP Retail Offer, along with the Company's existing cash resources will be deployed for general working capital purposes and to accelerate the implementation of its strategy.

The Issue Price represents a discount of approximately 19 per cent. to the closing mid-market price on 3 September 2024, being the latest practicable date before this announcement.

WRAP Retail Offer

The Company values its retail shareholder base and believes that it is appropriate to provide its existing retail shareholders in the United Kingdom the opportunity to participate in its fundraising on the same terms as participants in the Placing.

Accordingly, the Company is making the WRAP Retail Offer open to eligible investors in the United Kingdom, being existing shareholders of EQTEC, through certain financial intermediaries. A separate WRAP retail offer announcement will be made shortly covering all the details of the offer.

Shareholder conversions and subscription

In connection with the Placing and Subscription and pursuant to the terms of the funding facilities as announced on 20 November 2023, Altair Group Investment Limited ("Altair") and Pitcole Limited("Pitcole"), both existing significant shareholders in the Company, have been automatically deemed to have issued a conversion notice at a conversion price equal to the Issue Price in respect of their respective outstanding loan balances under the £3.0 million syndicated loan facility (the "Facility") (the "Shareholder Conversions"). Altair's outstanding balance under the Facility is £290,000 and Pitcole's is £232,000, both balances including principal and interest. Accordingly, a total amount of £522,000 is being converted into 52,200,000 new Ordinary Shares (the "Conversion Shares") at the Issue Price. Altair and Pitcole have entered into a lock-in agreement with the Company, pursuant to which they have agreed not to trade the Conversion Shares until after 28 February 2025. Altair has also subscribed for £100,000 as part of the Placing (the "Altair Participation").

Syndicated Loan Facility

Following the Shareholder Conversions, the outstanding principal balance remaining under the Facility is c. £880,000, held solely by YA II PN Ltd and Riverfort Global Opportunities PCC Limited (the "YA-RF Lenders").

The Company has agreed with the YA-RF Lenders to repay c. £185,000 towards their outstanding balances under the Facility. The YA-RF Lenders have also agreed not to convert any amounts of the remaining £696,000 balance under the Facility until after 28 February 2025 for a fee of c. £15,000.

Related party transaction

Altair has an existing holding of 41,535,382 Ordinary Shares in the Company representing 16.12% of the Company's issued share capital and, as such, is a substantial shareholder as defined in the AIM Rules for Companies (the "AIM Rules"). As a result, the Altair Participation is a related party transaction pursuant to Rule 13 of the AIM Rules. Accordingly, the Directors of the Company, having consulted with the Company's Nominated Adviser, Strand Hanson Limited, consider the terms of Altair Participation to be fair and reasonable insofar as the Company's shareholders are concerned.

Issue of Ordinary Shares to strategic providers

The Company further announces that it is proposing to issue, in aggregate, 7,711,059 new Ordinary Shares (the "Supplier Shares") at the Issue Price to certain strategic service providers providing business development and advisory services to the Group in satisfaction of fees due to them. The issue of the Supplier Shares will further align the interests of strategic advisers and service providers with those of the Company and its shareholders.

Broker appointment

The Company is pleased to announce the appointment of Shard Capital Partners LLP as joint broker with immediate effect.

Admission and Total Voting Rights

The Company will make an application to London Stock Exchange for the 110,000,000 Fundraise Shares, 52,200,000 Conversion Shares and 7,711,059 Supplier Shares (together, the "New Ordinary Shares") to be admitted to trading on AIM ("Admission"). The New Ordinary Shares will rank pari passu with the existing Ordinary Shares and it is expected that Admission will become effective and dealings in the new Ordinary Shares on AIM is expected to commence on or around 13 September 2024.

On Admission, the Company's issued share capital will consequently consist of 427,521,970 Ordinary Shares, each with one voting right. There are no shares held in treasury. Therefore, the Company's total number of Ordinary Shares and voting rights will be 427,521,970 and this figure may be used by shareholders following Admission as the denominator for the calculations by which they will determine if they are required to notify their interest in, or a change to their interest in, the Company under the UK Financial Conduct Authority's Disclosure Guidance and Transparency Rules.

The New Ordinary Shares will be issued under existing share authorities and (assuming no new Ordinary Shares are issued pursuant to the WRAP Retail Offer) will, in aggregate, represent approximately 40 per cent. of the Company's issued share capital as enlarged by the issue of the New Ordinary Shares.

The Placing and Subscription are conditional, inter alia, upon Admission occurring by not later than 8.00 a.m. on 13 September 2024 (or such later time and/or date as the Company may determine, but not later than 8.00 a.m. on 20 September 2024). In addition, the Placing and Subscription are conditional on the Company having received relevant monies from each Placee or Subscriber prior to Admission.

A further announcement regarding the result of, and admission of any ordinary shares subscribed under, the WRAP Retail Offer will be made in due course.

David Palumbo, CEO of EQTEC, commented:

"This Fundraise, alongside the earlier announced receipt of the settlement payment from LOGIK, provides the Company with a clear funding runway to fully focus our efforts on reaching profitability and our strategic growth following the implementation of our strategy to become a pure play technology licensor. Last year we transitioned our business away from risk and cost toward greater predictability and sustainability. We move away from project ownership and development, toward provision of our unique technology and engineering capabilities to projects owned and managed by others. We believe EQTEC now presents significant value, having emerged from the challenging transition period where we have not only implemented a much more resilient business model, but also achieved significant strategic progress whilst creating new exciting businesses opportunities such as integrated modular technology to produce synthetic renewable fuels from waste"

Further information on the Company can be found at www.eqtec.com.