SulNOx Group PLC - Subscription for New Shares

THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION FOR THE PURPOSES OF REGULATION 11 OF THE MARKET ABUSE (AMENDMENT) (EU EXIT) REGULATIONS 2019/310

 3 December 2024

SulNOx Group Plc (the "Company" or "SulNOx")

Subscription for New Shares

Exercise of Warrants

Holdings in the Company

Total Voting Rights

(Aquis Stock Exchange: SNOX)

Subscription for New Shares and Exercise of Warrants

The board of directors of the Company (the "Board") is pleased to announce that it has raised a total, before expenses, of £1,875,000 from a group of investors, consisting of both new and existing shareholders, including a strategic investor (the "Investors") and an existing warrant holder.

The Investors have agreed to subscribe for a total of 3,302,076 new ordinary shares of 2 pence each ("Ordinary Shares") at a price of 46.6 pence per Ordinary Share (representing a discount of 11.5% to the average closing price of the Ordinary Shares for the 5 trading days up to and including 29 November of 52.7p) raising £1,538,768 (the "Subscription").

Under the Subscription, the Investors will also receive warrants to subscribe for further Ordinary Shares at a price of 58.8 pence per Ordinary Share (the "Warrants").  The Investors will receive 1 Warrant for every 2.5 new Ordinary Shares subscribed.  A total of 1,320,829 Warrants will be issued. The Board will seek new allotment authorities relating to the Warrants at the Company's 2025 annual general meeting, with the Warrant holders having 3 years from the date that the new authorities are granted to exercise the Warrants.  Should new allotment authorities not be granted at the Company's 2025 annual general meeting, such authorities will be sought at the 2026 and 2027 meetings.

The Company is pleased to announce that a wholly owned subsidiary of McQuilling Partners, Inc. ("McQuilling") has invested in the Company and will be the preferred partner of the Company to promote and sell the SulNOx products in the U.S. market.  McQuilling is a privately-owned marine services company formed in 1972 and headquartered in New York with offices in Singapore, Athens, Madrid, Dubai, Houston, Lima, Mexico City, Rio de Janeiro and Mumbai.  McQuilling and its affiliated companies have 180 employees serving clients in the shipping, commodity, renewable and financial services industries covering brokerage, operations and administration, research, data services and consulting.

In addition, one of the subscribers, an institutional investor who participated in the fundraising announced on 22 December 2023, has indicated an intention to exercise 1,159,420 warrants at an exercise price of 29 pence per Ordinary Share, raising a further £336,232 (the "Exercise").

The proceeds from the Subscription and the Exercise will be utilised for the working capital requirements of the Company.  In particular, the Company intends to increase its global stock locations, and therefore stock inventory levels, of the SulNOxEco^TM fuel conditioner in expectation of a material increase of marine sales during 2025 resulting from positive evaluations, as highlighted in the Trading Update (6 November 2024) and Final Results (9 September 2024) announcements.  

Among the investors under the Subscription are two existing substantial shareholders of the Company, Constantine Logothetis and Nistadgruppen AS ("Nistad").  Mr Logothetis has subscribed for 1,703,365 new Ordinary Shares (via Arrowcove Ltd, a company he controls) and Nistad for 472,103 new Ordinary Shares. As Mr Logothetis and Nistad each have an existing interest in more than 10% of the Company's Ordinary Shares, their subscriptions constitute related party transactions under the AQSE Growth Market Apex Rules.  The Board has concluded, having exercised reasonable care, skill and diligence, that their Subscriptions are fair and reasonable as far as the shareholders of the Company are concerned.

The new Ordinary Shares for both the Subscription and the Exercise will be allotted under the Company's existing unspent share issue authorities and are expected to be admitted to trading on the AQSE Growth Market on 13 December 2024 ("Admission"). 

Radu Florescu, Chairman of SulNOx, commented, "We are delighted to again receive significant further support from our two largest shareholders, Mr Logothetis and Nistadgruppen AS, and to welcome McQuilling Partners as an important new investor and strategic partner for the U.S. market.  McQuilling has highly relevant expertise and networks, not only in the marine sector, where SulNOx has seen encouraging success, but also in key industries facing decarbonisation challenges."

"This new commitment of funds reflects the strong news flow from SulNOx during this year, regarding additional industries, geographies, distributors, new orders, and a rapidly growing patent portfolio."

John M. Schmidt, CEO of McQuilling, commented, "We are excited to have concluded this investment in SulNOx and to actively engage in growing the business particularly in the U.S. market.  SulNOx has developed an impressive product that reduces liquid hydrocarbon fuel consumption, associated greenhouse gases and harmful particulate matter emissions. We look forward to extending our partnership and offering these very compelling benefits to industry."

Holdings in the Company

Following Admission, the percentage of Ordinary Shares held by significant shareholders will be, to the best of the knowledge of the Company, as follows:

* This includes shares held by Tergeo Ltd, Arrowcove Ltd and Kambos SA in which Constantine Logothetis holds a majority interest.

** This includes shares owned by Sungold Escrow Nominees Ltd, a company controlled by Ms Bravo, and by trusts for the benefit of Ms Bravo's immediate family.  Ms Bravo's previously reported holding included voting rights for but not beneficial ownership of 2,298,810 Ordinary Shares.  The current holding includes 3,420,200 with both voting rights and beneficial ownership of Ordinary Shares and 2,298,810 with just voting rights.

Total Voting Rights

On Admission, the Company will have 126,012,442 Ordinary Shares in issue, each with one voting right. The Company does not hold any shares in treasury and therefore the total number of voting rights in the Company is 126,012,442. This figure should be used by shareholders from Admission as the denominator for the calculations by which they will determine if they are required to notify their interest in, or a change to their interest in the Company under the FCA's Disclosure Guidance and Transparency Rules.

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