Carnegie cuts debt and directs funding to progress CETO wave technology
Carnegie Clean Energy has substantially reduced its debt following the conversion of Au$1.75 million (€1.1 million) of convertible notes into shares and unlisted options, making the existing company’s funds sufficient to complete the CETO technology pathway.
According to Carnegie, all remaining convertible notes, due to mature at the end of March 2021 and valued at Au$1.075 million (€696,700), will either be converted to shares and options or the debt will be rolled over on the same terms.
The recent support from remaining noteholders together with the reduction in debt has greatly de-risked the business, while additional working capital provides funding for critical R&D and commercial development for CETO and spin-off technologies currently in development, according to Carnegie.
The remaining noteholders, Log Creek and HFM Investments, which are companies associated with Carnegie’s Director Mike Fitzpatrick, have agreed to either extend the remaining notes for further 12 months on same terms, or convert the notes to shares and options by the end of March.
The company also retains the right to repay the notes by the end of March, which would reduce company debt to zero, Carnegie said.
Carnegie’s Non-Executive Director, Grant Mooney, converted 250,000,000 options injecting Au$312,500 (€202,500) into the company to be applied towards the CETO wave energy technology development and for ongoing working capital.
In addition, Carnegie’s team of employees has also converted employee options issued under the Employee Incentive Plan to shares.
The current cash at bank supports the company’s strategic pathway and business plan as previously outlined and, more specifically, gives the technical team the timeframe to continue the technology and design innovations that are under R&D, as well as negotiations to continue with potential commercial partners.
Jonathan Fiévez, Carnegie’s Chief Executive Officer, said: “We are pleased with the support from our noteholders and the opportunity to avoid using Carnegie’s precious cash reserves to reduce debt carried over from the 2019 (Deed of Company Arrangement) Administration process. These are exciting times; the renewed interest and strong investment in Carnegie has resulted in the share register undergoing major changes over the past weeks and we are pleased to welcome our new shareholders.
“The recent strength in our share price and growth in market capitalisation are a reflection of existing and new shareholder support for wave energy, renewable energy, and in Carnegie’s future potential. I look forward to providing future technical and commercial updates to our loyal existing shareholders and our new shareholders as we progress on our technology pathway and move towards our goal of commercial readiness later this year”.
Directors Mike Fitzpatrick, Grant Mooney and Anthony Shields all remain top 10 shareholders, Carnegie informed.