Densitron Technologies PLC Lease settlement & issue of loan note (2348J)

TIDMDSN

RNS Number : 2348J

Densitron Technologies PLC

02 April 2015

Densitron Technologies plc

Lease settlement & issue of loan note

The Directors of Densitron Technologies plc are pleased to announce that they have reached an agreement with the Landlord of a property in Newcastle to surrender the lease.

The lease relates to a property formerly occupied by a subsidiary of the Company that was sold in 2006. Following a protracted legal dispute the Company made an out of court settlement with the Landlord in 2013 but this resulted in the Company being liable for the remainder of the lease which was due to expire on 31 December 2022.

Since 2013 the Company has marketed the property but has been unable to secure a tenant. Following discussions with the Landlord, the Coalfield Regeneration Trust, the Directors have agreed a surrender of the lease for a sum of GBP400,000. The total annual cost to the Company for the property, including rent, rates, insurance and ancillary costs, amounted to approximately GBP240,000.

The settlement has been financed by a GBP400,000 unsecured loan from the Company's largest shareholder, Mr Peter Gyllenhammar, with a coupon rate of 9% per annum and a repayment date up to 31 March 2016 ("Loan").

Mr Jan Holmstrom the Chairman of Densitron said: "This settlement brings to the close a situation that has cost the Company considerably both in terms of cost and time and has been an unwelcome distraction for the Company's management over several years. Agreeing this settlement will now enable management to focus entirely on the business going forward".

Related Party Transaction

Mr Peter Gyllenhammar is classified as a Related Party, as defined in the AIM Rules. The entering into the Loan by the Company is therefore classified as a transaction with a related party for the purposes of the AIM Rules. In accordance, therefore, with the AIM Rules, the directors of the Company, having consulted with the Company's nominated adviser, Westhouse Securities Limited, consider that the terms of the transaction are fair and reasonable insofar as the Company's shareholders are concerned.

Enquiries:

 
Densitron                Westhouse Securities 
 Grahame Falconer / Tim   Martin Davison 
 Pearson                  Tel: [phone] 
 Tel: [phone] 
 

This information is provided by RNS

The company news service from the London Stock Exchange

END

MSCEFLFBEZFZBBF