TEAM plc Secures Funding Through Convertible Notes
TEAM plc (AIM: TEAM), a recognized player in wealth and asset management, has recently communicated an exciting funding initiative through the issuance of convertible loan notes (CLNs). This initiative is set to raise up to £1,000,000, a move that aims to enhance its working capital and facilitate deferred consideration payments.
Details of the Convertible Loan Notes
These CLNs are unsecured and will carry an 8% annual interest rate over a term of three years, concluding on December 23, 2027. The company benefits from an early redemption option after 12 months, providing added flexibility. However, the note holder, NFG Capital Limited, is restricted from demanding redemption prior to maturity without TEAM's explicit consent.
Tranche Drawdowns and Fees
The principal sum can be accessed in four tranches of £250,000 each. The initial tranche is available immediately, with a required delay of at least 90 days between drawdowns for subsequent tranches. It's worth noting that a 2% drawdown fee applies to each of these post-initial tranches. For the third and fourth drawdowns, TEAM plc will also issue 250,000 warrants, which can be exercised at 10 pence per share and will expire upon either conversion or repayment of the CLNs.
Conversion and Repayment Terms
Note holders have the privilege to convert their notes into ordinary shares at their discretion prior to the third anniversary of issuance, set at a conversion price of 15 pence per share. If the notes are not converted, they are due for repayment at par value alongside any accrued interest on the maturity date. Interestingly, should a change of control occur before the third anniversary, the note holder gains the right to convert at either the pre-established conversion price or the lower actual share price.
Market Listing and Shareholder Engagement
Despite the potential for significant investment, the CLNs will not be listed on any exchange. However, they remain transferable provided TEAM gives consent. To gather shareholder approval for the issuance of shares related to this fundraising effort, an Extraordinary General Meeting (EGM) is scheduled, aiming to discuss these developments and other pertinent matters.
Leadership Changes Within TEAM plc
In an additional announcement, it was revealed that Michael Gray will step down as a non-executive director effective December 31, 2024, with no immediate replacement designated. Philip Taylor will assume the Chair of the Remuneration Committee while continuing in his role as Senior Non-Executive Director, where his casting vote will remain crucial.
Gratitude for Contributions
Mark Clubb, Executive Chair of TEAM plc, expressed heartfelt thanks to Michael Gray for his invaluable contributions since the company's initial public offering (IPO), highlighting his strategic insights and wishing him success in his future endeavors.
This financial strategy represents TEAM plc’s broader objectives to ensure sufficient funding for its operational and strategic growth initiatives, emphasizing their commitment to sound financial management and positioning in the competitive landscape of asset management.
Frequently Asked Questions
What is the purpose of the convertible loan notes issued by TEAM plc?
The convertible loan notes aim to raise funds to enhance working capital and manage deferred payment obligations.
What are the key terms of the convertible loan notes?
They carry an 8% annual interest rate, are unsecured, and have a three-year term, with an option for early redemption after 12 months.
Who is the note holder for TEAM plc's convertible loan notes?
The note holder for this issuance is NFG Capital Limited.
What will happen if the notes are not converted?
If not converted, the notes must be repaid at par value along with accrued interest on the maturity date.
What changes were recently announced regarding TEAM plc's board?
Michael Gray will step down as a non-executive director at the end of 2024, with no replacement planned, while Philip Taylor takes on additional responsibilities.
