CAP Clean Air

RNS Number:0807Q
Clean Air Power Limited
13 March 2008


For immediate release                                            13 March 2008

                              Clean Air Power Ltd

                      ("Clean Air Power" or "the Company")

                   Conditional investment of up to �5million

Clean Air Power (AIM : CAP) today announces that it has agreed, subject to the
passing of resolutions by the Company's shareholders at a Special General
Meeting, a private financing package with Endeavor Capital Management LLC and
certain other investors to provide funds for the further commercialisation of
its patented technology.

Financing details

The financing package will provide proceeds of up to around �5.0m for the
Company between April 2008 and June 2009. Endeavor, a longstanding and major
shareholder in the Company, currently holding 18.5% of the Company's shares, has
conditionally agreed to provide up to �4.65m of the new funds. The remaining
funds will be provided by another institutional investor which has agreed to
invest approximately �0.25m and the Company's management which is investing a
further �0.10m.

The funds will be received in six tranches. The first three tranches will be;
�1m on or before 30 April 2008; �0.5m on 30 June 2008; and �0.5m on 30 September
2008.
The remainder of the financing package will be available to the Company through
the exercise of call and put options to be granted to Endeavor and the Company
respectively. The second three tranches will each be for �1m and will (if
exercised) be received between 1 October 2008 and 30 June 2009 under a mutual
call/put option structure.

Endeavor's obligations will become absolute subject to the closing of certain
investment funds.
If Endeavor's obligation under the put option does not become absolute on or
before June 30, 2008, Endeavor shall on or before December 15, 2008, subscribe
for such number of Common Shares as have an aggregate value of approximately
�500,000.

For every two common shares subscribed for pursuant to the financing package,
the Company will issue a warrant for the purchase of one additional common
share, exercisable within three years, with an exercise price at a 40% premium
to the issue price.

Endeavor is required to participate in each of the six tranches of the financing
package, with the other institutional investor and management only investing in
the first tranche. Depending on the movement in the share price prior to the
closing of each tranche, and the exercise of the latter three tranches, Endeavor
may acquire a majority interest in the Company.

The Company Bye-laws incorporate by reference various provisions of the City
Code, including Rule 9 of the City Code. However, this requirement may be waived
by an independent vote at a meeting of the Company shareholders and,
consequently, it is proposed that such a resolution, with regards to acquisition
of Common Shares by Endeavor or its Affiliates, be proposed at a Special General
Meeting.

Endeavor currently holds 18.5% of the issued share capital, and is therefore a
related party under the AIM rules.

The Directors consider, having consulted with Canaccord Adams, that the terms of
the transaction are fair and reasonable insofar as the Company's shareholders
are concerned.

The placing is conditional upon the passing of resolutions by the Company's
shareholders at a special general meeting.

The Directors are pleased to confirm that the Company has obtained irrevocable
undertakings to vote in favour of the Resolutions from Shareholders holding
approximately 67% of the issued Common Shares.

Reasons for financing

In November 2007, the Company announced its intention to raise further funds.
Given the current sentiment in capital markets, the Board of Directors are
pleased to have secured this significant level of funding which provides the
Company with the essential funds required to continue the business operations
going forward.

The funds raised will be used to further advance in-house product development,
provide working capital to support existing operations and to provide resources
for potential manufacturer cooperation activity.

The main objective of the Company remains to enter into a cooperation agreement
whereby its Dual-FuelTM technology is adopted by a major manufacturer.  The
Company recently announced that considerable progress has already been made with
a major manufacturer. Although a formal agreement has not yet been reached, the
Company continues to believe that the discussions could lead to a formal
cooperation agreement being reached during 2008.

Special General Meeting

An extraordinary general meeting of Clean Air Power has been convened for
11.00am (Bermuda time) on Monday 7 April 2008 at Clarendon House, 2 Church
Street, Hamilton, Bermuda. The circular and notice of shareholder meeting will
be posted to shareholders and will be available on the Company's website.

Note: The placing is being conducted in reliance upon available exemptions from
the U.S. Securities Act of 1933 in accordance with Section 4(2) thereof and
Regulation D and Regulation S there under.

THIS COMMUNICATION DOES NOT CONSTITUTE AN OFFER OF SECURITIES FOR SALE IN THE
UNITED STATES. THE SECURITIES REFERRED TO ABOVE MAY NOT BE OFFERED OR SOLD IN
THE UNITED STATES ABSENT REGISTRATION UNDER THE U.S. SECURITIES ACT OF 1933 OR
IN RELIANCE UPON AN EXEMPTION THEREFROM.

For further details please contact:

Clean Air Power                                 Tel: +44 (0) 1494 527110
John Pettitt, Chief Executive
Peter Rowse, Finance Director

Buchanan Communications                         Tel: +44 (0)20 7466 5000
Charles Ryland/Ben Willey/Ben Romney

Canaccord Adams Ltd                             Tel: +44 (0)20 7050 6500
Robert Finlay/Clayton Bush




                      This information is provided by RNS
            The company news service from the London Stock Exchange

END
MSCUOSNRWUROAAR

Clean Air (LSE:CAP)
Historical Stock Chart
From Jun 2024 to Jul 2024

Clean Air (LSE:CAP)
Historical Stock Chart
From Jul 2023 to Jul 2024