24th Mar 2016 16:09
LONDON (Alliance News) - Cloudbuy PLC on Thursday said Roberto Sella, an existing shareholder, conditionally agreed to invest millions of pounds in loan notes to be issued by the company.
In a statement, Cloudbuy said Sella will subscribe for a minimum principal amount of GBP3.3 million and up to a maximum of GBP5.8 million of new, secured 10-year convertible and non-convertible loan notes. Sella holds an 11.45% stake in Cloudbuy.
In addition, the company said Non Executive Director Patrick Broughton subscribed for 1.5 million shares and Chief Financial Officer David Gibbon subscribed for 307,692 shares, alongside a subscription by "an employee of the company and his spouse" for 100,000 new shares each. The shares were bought at 6.5 pence each, raising GBP133,000.
In addition, Cloudbuy agreed bridging facilities of up to GBP200,000 with Broughton, Executive Chairman Ronald Duncan and Lyn Duncan, to cover its short-term cash requirements. The bridging loan was agreed due to an "unexpected delay" in a proposed subscription for shares from a potential strategic partner based in Saudi Arabia. The company said it expects to refinance the bridging facilities from the net proceeds of funds from that Saudi partner.
"The financing raised will enable the company to continue with the existing contracts and their progress to revenue along with a number of new leads that we have and the growth of our ongoing relationship with Visa. On behalf of the board I would like to thank Roberto Sella for his continued support," Ronald Duncan said in a statement.
Cloudbuy named Michael Pasternak as a non-executive director, identifying him as an early investor in the company and a background in investment banking that has seen him work for Saudi International Bank in London and Goldman Sachs in New York. David Holloway has resigned with immediate effect after seven years' service, Cloudbuy said.
"Michael Pasternak is a resident of the USA and his experience will assist in cloudBuy's expansion in Saudi Arabia and the USA. He has also been influential in securing funding for the company," the company said.
Pasternak holds 2.2 million shares in the company, equivalent to a 1.67% stake.
Cloudbuy also announced changes to share options issued in 2013, 2014 and 2015. It will cancel those 9.4 million options and reissue them at an exercise price of 10 pence per share, a 57% premium to the closing price on Wednesday.
An additional 2.0 million new options at an exercise price of 10p will be issued to executive directors, with 2.8 million existing options remain unchanged, giving a total of 14.2 million incentive options in issue.
"Since the publication of the interim results and significant fall in the company's share price over the last six months, the remuneration committee has been considering the need for appropriate share incentives at director and employee level," CloudBuy said.
"In particular, consideration has been given to the options issued in 2013, 2014 and 2015 when the company's short-term prospects appeared better and the options then issued, had exercise prices based on a much higher share price," the company added.
Shares in CloudBuy were up 3.5% at 6.60 pence on Thursday afternoon.
By Samuel Agini; [email protected]; @samuelagini
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