TIDMCDL
RNS Number : 4603T
Cloudbreak Discovery PLC
15 November 2023
15 November 2023
Cloudbreak Discovery Plc
('Cloudbreak', or 'the Company')
Company Update
Cloudbreak Discovery Plc, (LSE: CDL), a natural resources
project generator in the mining and energy sectors is pleased to
provide the following corporate update.
Following the resignation of Kyler Hardy as Chairman and CEO and
the appointment of Andrew Male as Interim CEO, the Board has, over
the past few months, undertaken an analysis and review of the
Company's investments, assets and operations and legacy matters
relating to its former management. Upon completion of this review,
the Board has agreed to a number of matters with former management
and have entered into the agreements described below (collectively,
the " Settlement Agreements ").
Under the terms of the Settlement Agreements, former management
and their related consulting companies Cronin Capital Ltd (" CCL
"). and Cronin Services Ltd (" CSL ") (together " the Cronin
Parties "), have agreed to enter into the following agreements with
the Company.
1. Purchase and Assignment of Debt Agreement (" Debt Agreement ").
The Company has an existing liability in its books of GBP907,710
(" Cloudbreak Debt ") to the Cronin Parties in relation to
outstanding management charges incurred over the past [two] years.
Under the terms of this Debt Agreement all outstanding amounts owed
to the Cronin Parties are being purchased and assigned to
investors. The investors have agreed to pay the Cronin Parties
GBP136,156.50 in consideration for the assignment. The investors
have also agreed with the Company that they will subsequently
convert the Cloudbreak Debt into ordinary shares in the Company
following the Annual General Meeting on 24 November 2023.
Two of the investors participating in the Debt Agreement are
Andrew Male, interim CEO and Director, and Paul Gurney,
Director.
2. Share Purchase Agreement (" SPA ").
CCL and CSL own 91,626,928 and 21,090,400 ordinary shares in
Cloudbreak, respectively, giving a total of 112,717,328 ordinary
shares. Under the terms of the SPA, CCL and CSL will sell 100% of
their shares in Cloudbreak, in the second of a two-stage
process.
Stage 1:
The Galleon 2023 Ltd., (" Galleon ") a company unconnected to
Cloudbreak, has agreed to purchase the following assets from
Cloudbreak. The assets (collectively, the " Legacy Assets ") being
acquired include the following:
-- 100% of the shares of Kudu Resources Ltd. and all of its holdings;
-- The Foggy Mountain Property in the Toodoggone region of British Columbia;
-- The Le Blache Royalty Agreement stipulating a 2% Net Smelter Royalty;
-- 1,700,000 shares of Buscando Resources Corp.; and
-- 950,000 shares of Temas Resources Corp.
The Legacy Assets are being transferred from Cloudbreak to
Galleon for an aggregate consideration of GBP102,000. During the
analysis and review of the Cloudbreak assets, the Board agreed that
the Legacy Assets were not core to the Company's business strategy
and given the Cronin Parties' historic involvement in the Legacy
Assets, it was resolved to dispose of the Legacy Assets. Paul
Gurney and Emma Priestley, the independent directors of Cloudbreak
have also agreed to the transactional value of these Legacy Assets
as being fair and reasonable.
Stage 2:
Galleon has agreed with the Cronin Parties that it will transfer
the Legacy Assets to the Cronin Parties plus an additional
GBP207,000 in cash and in turn will receive all 112,717,328
ordinary shares in Cloudbreak owned by CCL and CSL. Cloudbreak
currently has 607,678,805 ordinary shares issued and outstanding
and this acquisition of Cloudbreak shares will result in Galleon
becoming an 18.5% shareholder of Cloudbreak.
Pursuant to a lock-in agreement (" Lock-In Agreement ") Galleon
has agreed with Cloudbreak that it will not dispose of its
shareholding in the Company for a 12-month period following the
date of the Lock-in Agreement, unless Galleon and Cloudbreak
mutually agree to change the terms of the Lock-In Agreement or to
provide consent to any disposal.
It is contemplated that all of the Settlement Agreements will
have a Closing Date of 21 November 2023.
Cloudbreak will upon closing provide shareholders with a
comprehensive update on all assets, opportunities and capital
structure.
Andrew Male, Interim CEO, commented; "We are happy to have
agreed to these arrangements and agreements with the Cronin Parties
and former management and we look forward to updating our
shareholders in the near future. We thank all shareholders for
their patience during this time and look forward to re-engaging in
the near future."
The participation of Andrew Male and Paul Gurney in the Debt
Agreement represents a Material Related Party transaction. Emma
Priestley, the sole independent director for the purposes of this
transaction, has approved the transaction as being fair and
reasonable from the perspective of Cloudbreak and its
shareholders.
This announcement contains inside information for the purposes
of Article 7 of the Market Abuse Regulation (EU) 596/2014 as it
forms part of UK domestic law by virtue of the European Union
(Withdrawal) Act 2018 ("MAR"), and is disclosed in accordance with
the Company's obligations under Article 17 of MAR.
- Ends -
For additional information please contact:
Cloudbreak Discovery Tel: +44 792 6 397675
PLC
Andrew Male, Interim andrew@westridgemi.com
CEO
Novum Securities Tel: +44 7399 9400
(Financial Adviser)
David Coffman / George Duxberry
Oberon Capital Tel: +44 20 3179 5355
(Broker) /
+44 20 3179 5315
Nick Lovering / Adam
Pollock
About Cloudbreak Discovery PLC
Cloudbreak Discovery PLC is a leading natural resource project
generator and royalty business. Cloudbreak is focused on energy
royalty acquisitions with the aim of bringing near-term cashflow
and driving shareholder value. Its primary operating jurisdiction
is the United States, but the Company also deploys its project
generation model in the international energy sector to acquire
minority interests in projects of merit.
Through its wholly owned but independently operated subsidiary,
Cloudbreak Exploration Inc., the Company will develop its array of
mineral assets, whilst continuing to generate new projects with a
particular focus on commodities key to the energy transition .
Cloudbreak's generative model across the energy and mineral
sector enables a multi-asset approach to investing and exploration.
Diversification within the natural resource sector and amongst
resource classes is key to withstanding the cycles of
investing.
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END
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