XLTechGroup secures US$35 million borrowing facility
03 January 2006
XL TechGroup (AIM: XLT), the systematic architect and builder of an ongoing stream of high value new companies, today announces it has arranged a borrowing facility of up to US$35 million with Laurus Master Fund Ltd (“Laurus”), a New York based institutional equity fund that specialises in making direct investments in growing public companies. The facility is secured principally against XL TechGroup’s private and public equity assets, including its 27.2 per cent shareholding in AgCert International plc (“AgCert”), which is listed on the London Stock Exchange.
Under the terms of the arrangement, XL TechGroup has unrestricted access to US$25 million to fund its working capital requirements, with a further US$10 million available when XL TechGroup portfolio companies, TyraTech LLC and DxTech LLC, achieve certain financial milestones. The facility is due for repayment in three years and has a variable interest rate, which is currently 9.75 per cent, being 2.5 per cent over the US Prime Rate.
Laurus has been granted a seven year option to invest up to a total of US$7 million (being 20 per cent of the borrowing facility) in buying shares held by XL TechGroup in any of its portfolio companies. In this regard, Laurus has the option to acquire AgCert shares held by XL TechGroup at a 5 per cent premium to the AgCert share price as at 30 December 2005, or the option to acquire shares in any XL TechGroup portfolio company that seeks a stock market listing, at a 20 per cent discount to the then IPO price. From 30 June 2006, Laurus is also entitled on an annual basis to receive either cash or additional AgCert shares from XL TechGroup with a value equivalent to 6 per cent of the outstanding principal under this facility, calculated in relation to the AgCert share price at that time.
There are no conditions that would require XL TechGroup to provide additional security in the event of a fall in the AgCert share price, or to surrender any AgCert shares, save for a loan default. Laurus has agreed to be restricted by the terms of the lock-in entered into between XL TechGroup and AgCert on 3 June 2005, on any AgCert shares that may be due to it under the terms of this financing arrangement.
John Scott, Chief Executive Officer of XL TechGroup, said: “We are
very pleased to have secured this funding from Laurus which will enable
us to continue the development of our existing companies as well as new
opportunities in our pipeline. The terms of the agreement allow us to preserve
the substantial upside value we anticipate from our shares in AgCert, and
to do so without giving up any XL TechGroup equity. TyraTech and DxTech
are making excellent progress towards significant liquidity events within
the next couple of years, and we are very excited about a number of the
opportunities in our business creation pipeline.”
If you would like further information, please contact:
hgubnitsky@xltg.com
If you have any media enquiries, please contact:
Disclaimer for US Site Visitors
This web site contains investor-related information that is directed only to non-US persons. The investor-related and other information provided on this web site is for use only by non-U.S persons, and is not an offer to buy or sell, or a solicitation of an offer to buy or sell, any XL TechGroup securities. Moreover, we may not offer or sell XL TechGroup securities in the U.S. absent registration or an exemption from registration. If you are a U.S. person, or a person acquiring XL TechGroup ordinary shares for the account or benefit of any U.S. person, you agree and acknowledge that XL TechGroup's ordinary shares have not been registered under the U.S. Securities Act of 1933, as amended, and any offer or sale of XL TechGroup securities by XL TechGroup or its affiliates may be made solely pursuant to an exemption from the U.S. Securities Act of 1933, as amended.