28 March 2024

THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION AS STIPULATED UNDER THE MARKET ABUSE REGULATION (EU NO. 596/2014) AS IT FORMS PART OF UK DOMESTIC LAW BY VIRTUE OF THE EUROPEAN UNION (WITHDRAWAL) ACT 2018 (AS AMENDED) ("MAR"). UPON THE PUBLICATION OF THIS ANNOUNCEMENT VIA A REGULATORY INFORMATION SERVICE, THIS INSIDE INFORMATION IS NOW CONSIDERED TO BE IN THE PUBLIC DOMAIN.

MOLECULAR ENERGIES PLC

("Molecular" or the "Company")

Update on IPO of Green House Capital Group plc

Proposed cancellation of admission of Ordinary Shares to trading on AIM

Re-registration as a Private Limited Company

Adoption of New Articles of Association

Notice of General Meeting

Molecular Energies plc (AIM: MEN), the international energy company, today announces an update on the IPO of Green House Capital Group PLC ("Green House"), the proposed cancellation of admission of its ordinary shares to trading on AIM (the "Cancellation"), re-registration of the Company as a private limited company (the "Re-registration") and the adoption of new articles of association (the "New Articles").

The Company has today published a circular, extracts of which are published below, setting out the background to and reasons for the proposed Cancellation and the Re-registration and associated adoption of the New Articles (the "Circular"). The Circular also contains a notice convening a general meeting (the "General Meeting") at which Shareholders are invited to consider and, if thought fit, approve the proposed Cancellation and the Re-registration and associated adoption of the New Articles.

Peter Levine, Chairman, comments: "I take no joy in recommending the cancellation of trading in Molecular's shares on AIM and know that this proposal will impact many shareholders. However the primary benefits of being listed are to avail oneself of access to capital, the ability to utilise one's shares as currency and enjoying the reputational boost of being on the London Stock Exchange. Molecular no longer receives any of those benefits and so can no longer justify the disproportionately high costs of remaining listed. As a Group its interests are best served by turning to the private arena where Molecular can regenerate away from the microscope and constraints of the public markets yet avail itself of funding and exit opportunities in some ways more flexible and abundant than remaining as a small public company on the London market.

Since I do understand the disappointment that this will cause and which I wholeheartedly share, whilst making no commitment to do so, I do not rule out in the fullness of time and subject to de-listing and on becoming a private company making proposals to buy the shares of certain of those holders who either do not wish or are unable to be invested in a private business.

My consideration in this direction reflects my conviction in the value of Molecular as a whole and of the new businesses that we continue to generate within the Company which the London market clearly does not recognise. I am confident that Molecular and its various businesses will thrive once again as a private enterprise with my continued support and invite any holders so minded to continue the journey alongside. In return shareholders can be assured that all who remain invested in whatever size will be dealt with fairly and will benefit from the openness in relation to shareholder communications through our website, social media and other channels, that we have always sought to apply." 

UPDATE ON IPO OF GREEN HOUSE CAPITAL GROUP PLC

The Board has reconsidered the potential merits of the IPO of its 75 per cent. owned carbon removal and mitigation subsidiary, Green House Capital Group plc. The Board takes the view given the considerations in relation to Molecular outlined below and the ongoing adverse sentiment affecting the London capital markets that an IPO of this business at its early stage of development is not in the best interests of the Company or its Shareholders at the current time. The Directors will in due course review options in relation to this independently run group as this business becomes more mature sheltered from the public markets. This may include separately and privately funding parts of the group as may be appropriate.

DETAILS OF THE PROPOSED CANCELLATION AND RE-REGISTRATION

The Directors have conducted an assessment of the benefits and drawbacks to the Company and its Shareholders of retaining its quotation on AIM, and believe that Cancellation is in the best interests of the Company and its Shareholders as a whole.

In reaching this conclusion, the Directors have considered the adverse share price performance of the Company, its current market capitalisation, the perception of the Company on AIM versus its potential, and the various potential sources of capital available to the Company to fund its medium term growth plans. In particular and without limit thereto, the Directors consider:

▪     that despite the best and continual efforts of the Company to set forth its compelling investment case, its share price has continued to fall to a level that the Board believes is far removed from the underlying value of the Group. The Board considers that the reasons for this include that the Company operates and invests in territories (e.g. the southern cone of South America) that the London capital markets does not prioritise or fully comprehend and what the Directors perceive as the current dysfunction of the London markets with regard to small/micro cap companies. The Board believes that the disconnected market value is damaging to the reputation of the Company as it seeks to engage partners and grow its business. Accordingly, the Board believes that Company's growth prospects are more readily accessible and managed in a private market environment;

▪     that the continued quotation on AIM is thus unlikely to provide the Company with significantly wider access to capital than the funding options it already has. The Directors believe that an equity fundraise for the purpose of either expansion or acquisition through the public markets would not necessarily be available to the Company in the near or medium term or if it were the Directors would not be able to recommend the likely dilutive impact to existing shareholders. Further, the Company's existing major shareholder has indicated that he is presently unwilling to provide further capital support to the Company on an ongoing basis in the event that its shares remain admitted to trading on AIM. Accordingly, the Board is of the view that there may be greater opportunities to raise additional capital in the private markets than remaining as a listed business;

▪     there has been limited liquidity in the Ordinary Shares for some time and, consequently, the admission of the Ordinary Shares to trading on AIM does not necessarily offer investors the opportunity to trade in meaningful volumes or with frequency within an active market. With low trading volumes, the Company's share price can move and has moved up or down significantly following trades of disproportionately small volumes of Ordinary Shares. In the opinion of the Directors, the volatile share price is detrimental to the perception of the Group amongst customers, suppliers and other partners, which, in turn, has the potential to negatively impact its product development, staff incentives and morale and industry reputation;

▪    the considerable management time, cost and the legal and regulatory burden associated with maintaining the Company's admission to trading on AIM is, in the Directors' opinion and in the light of the above, disproportionate to the benefits of the Company's continued admission to trading on AIM. Given the lower costs associated with private limited company status, it is estimated that the Cancellation and Re-registration will materially reduce the Company's recurring administrative and adviser costs by approximately £500,000 per annum, which the Directors believe can be better spent supporting growth in the Group's business.

Following careful consideration, the Directors therefore believe that it is in the best interests of the Company and Shareholders as a whole to seek the proposed Cancellation and Re-registration at the earliest opportunity.

To be passed, the resolution in respect of the Cancellation requires, pursuant to Rule 41 of the AIM Rules, the approval of not less than 75 per cent. of the votes cast by Shareholders at the General Meeting. The resolution to approve the Re-registration and the adoption of New Articles also requires the approval of not less than 75 per cent. of the votes cast by shareholders at the General Meeting.

The expected timetable for the proposed Cancellation and Re-registration is set out below.

TRANSACTIONS IN THE ORDINARY SHARES PRIOR TO AND POST THE PROPOSED CANCELLATION

Shareholders should note that they are able to continue trading in the Ordinary Shares on AIM prior to the Cancellation. Shareholders should consult with their own independent financial adviser and/or broker should they wish to consider selling their interests in the market prior to the Cancellation becoming effective.

Should the Resolutions be approved by Shareholders, the Company will implement a matched bargain facility which would facilitate Shareholders buying and selling Ordinary Shares on a matched bargain basis following Cancellation. In anticipation of providing a matched bargain facility, the Company has sought quotes from third party providers. Further details of the Matched Bargain Facility will be communicated to Shareholders separately in due course and made available on the Company's website.

Shareholders should also be aware that any such Matched Bargain Facility could be withdrawn at a later date. Following Cancellation, the provision of a Matched Bargain Facility will be kept under review by the Board and, in determining whether to continue to offer a Matched Bargain Facility, the Company shall consider expected (and communicated) Shareholder demand for such a facility as well as the composition of the Company's register of members and the costs to the Company and Shareholders.

THE GENERAL MEETING

The General Meeting will be held at Building 5, Carrwood Park, Selby Road, Leeds, LS15 4LG at 11.00 a.m. on 15 April 2024.

The Company has received irrevocable undertakings from each of the Directors and their connected parties to vote, or procure votes, in favour of the Resolutions representing, in aggregate, Ordinary Shares. Accordingly, the Company has received irrevocable undertakings to vote in favour of the Resolutions representing approximately 30 per cent. of the Company's issued share capital as at the date of this announcement.

CURRENT TRADING AND FUTURE PROSPECTS

On 1 March 2024, the Company announced an update on various corporate and trading matters. In particular, the Company highlighted that the Tapir x-1 exploration well at the Pirity Concession in Paraguay had been suspended due to drilling difficulties. This well has now been abandoned. The Company, along with its partners in this well, are still reviewing what next steps they should take regarding the Pirity Licence. It is highly probable that the Company will decide to terminate all exploration activities in Paraguay which will lead a complete write off of the Company's investment in that country in the current financial year.

The Company also highlighted that it continues to receive cash contributions from the sale of its former subsidiary, President Petroleum S.A., a company that is ultimately wholly beneficially owned by Peter Levine, the Company's Chairman and largest shareholder. Approximately US$1.28 million has now been paid to Molecular over the last four months and the Company expects that it will continue to receive further funds over the next two and a half years on an ad hoc basis subject to the terms and conditions of the original sale agreement. The Company is reliant upon these funds  to satisfy the ongoing operational costs of the business and any surplus received above those requirements will be applied to pursue new opportunities for the benefit of all Shareholders. In particular, the Company continues to consider the feasibility of moving into the sustainable aviation fuel business. It is expected that these studies will continue for the next six months before a decision is made to allocate further, more meaningful capital, into this business line.

The Company continues to hold an 18.4 per cent. interest in the issued share capital of Atome plc and is encouraged by the progress that company has made. Shareholders are reminded that this stake in Atome plc acts as security against a loan to the Company from IYA Global Limited, a company wholly beneficially owned by Peter Levine, the Company's Chairman. US$12 million of this loan is outstanding as at the date of this document and would be immediately repayable in the event that Peter Levine or his related parties cease to be the largest shareholder in the Company or if Peter Levine is removed as Chairman of the Company.

As announced on 4 March 2024, Green House, the Company's 75 per cent. carbon removal and mitigation subsidiary, has made significant commercial progress in each of its businesses. Moreover, Green House has received advanced assurance for prospective EIS investment under the UK government initiative which encourages investment in qualifying early-stage companies by offering tax benefits to qualifying investors who subscribe for new shares in Green House. Due to the continued challenging public market conditions, the Directors have decided that it is not in the best interests of the Company or its Shareholders to pursue an IPO of Green House on AIM at this time. The Directors will consider options for this independently run business in due course.

GENERAL

Capitalised terms in this announcement, unless otherwise defined, have the same meaning as will be set out in the Circular.

A copy of the Circular and the New Articles will be made available on the Company's website at https://www.molecularenergiesplc.com/investors/documents-circulars/.

For more information, please visit www.molecularenergiesplc.com or contact:

For the purposes of MAR, Article 2 of Commission Implementing Regulation (EU) 2016/1055 and the UK version of such implementing regulation (as amended), the person responsible for arranging for the release of this Announcement on behalf of the Company is Peter Levine, Chairman.

EXPECTED TIMETABLE OF PRINCIPAL EVENTS

Notes:

1.   References to times in this Document are to London time, unless otherwise stated.

2.   Each of the times and dates in the above timetable is subject to change. If any of the above times and/or dates change, the revised times and dates will be notified to Shareholders by an announcement through a Regulatory Information Service.

3.   The Cancellation requires the approval of not less than 75 per cent. of the votes cast (in person or by proxy) by Shareholders at the General Meeting.

The following text is extracted from the Circular without amendment:

1.        Introduction

As announced by the Company on 28 March 2024, the Directors have concluded that it is in the best interests of the Company and its Shareholders to cancel the admission of the Ordinary Shares to trading on AIM. Pursuant to Rule 41 of the AIM Rules, the Company (through its nominated advisers, Cavendish) has notified the London Stock Exchange of the date of the proposed Cancellation.

The Cancellation is conditional, pursuant to Rule 41 of the AIM Rules, upon the approval of not less than 75 per cent. of the votes cast by Shareholders (whether present in person or by proxy) at the General Meeting, notice of which is set out at Part 4 of this document.

Accordingly, the Company is seeking Shareholder approval for the Cancellation, Re-registration and adoption of the New Articles at the General Meeting, which has been convened for 11.00 a.m. on 15 April 2024 at Carrwood Park, Selby Road, Leeds, LS15 4LG. If the Cancellation Resolution is passed at the General Meeting, it is anticipated that the Cancellation will become effective at 7.00 a.m. on 29 April 2024.

The Company has received irrevocable undertakings from certain shareholders and each of the Directors, to vote, or procure votes, in favour of the Resolutions representing, in aggregate, 3,741,371 Ordinary Shares.

Accordingly, the Company has irrevocable undertakings to vote in favour of the Resolutions by Shareholders representing approximately 30 per cent. of the Company's issued share capital as at 27 March 2024 (being the latest practicable date prior to publication of this Document).

The purpose of this Document is to seek Shareholder approval in respect of the Resolutions, to provide information on the background and reasons for the proposed Cancellation and the Re-registration and associated adoption of the New Articles, to explain the consequences of the Cancellation and the Re-registration and associated adoption of the New Articles and provide reasons why the Directors unanimously consider the Cancellation and the Re-registration and associated adoption of the New Articles to be in the best interests of the Company and its Shareholders as a whole.

The Notice of the General Meeting is set out in Part 4 of this Document.

In addition, and as also announced by the Company today, the Board has reconsidered the potential merits of the IPO of its 75 per cent. owned carbon removal and mitigation subsidiary, Green House Capital Group plc. The Board takes the view given the considerations in relation to Molecular outlined below and the ongoing adverse sentiment affecting the London capital markets that an IPO of this business at its early stage of development is not in the best interests of the Company or its Shareholders at the current time. The Directors will in due course review options in relation to this independently run group as the business becomes more mature sheltered from the public markets. This may include separately and privately funding parts of the Group as may be appropriate.

2.        Background to and reasons for the Cancellation and Re-registration

The Directors have conducted an assessment of the benefits and drawbacks to the Company and its Shareholders of retaining its quotation on AIM, and believe that Cancellation is in the best interests of the Company and its Shareholders as a whole.

In reaching this conclusion, the Directors have considered the adverse share price performance of the Company, its current market capitalisation, the perception of the Company on AIM versus its potential, and the various potential sources of capital available to the Company to fund its medium term growth plans. In particular and without limit thereto, the Directors consider:

·        that despite the best and continual efforts of the Company to set forth its compelling investment case, its share price has continued to fall to a level that the Board believes is far removed from the underlying value of the Group. The Board considers that the reasons for this include that the Company operates and invests in territories (e.g. the southern cone of South America) that the London capital markets does not prioritise or fully comprehend and what the Directors perceive as the current dysfunction of the London markets with regard to small/micro cap companies. The Board believes that the disconnected market value is damaging to the reputation of the Company as it seeks to engage partners and grow its business. Accordingly, the Board believes that Company's growth prospects are more readily accessible and managed in a private market environment;

·       that the continued quotation on AIM is thus unlikely to provide the Company with significantly wider access to capital than the funding options it already has. The Directors believe that an equity fundraise for the purpose of either expansion or acquisition through the public markets would not necessarily be available to the Company in the near or medium term or if it were the Directors would not be able to recommend the likely dilutive impact to existing shareholders. Further, Company's existing major shareholder has indicated that he is presently unwilling to provide the capital support to the Company on an ongoing basis in the event that its shares remain admitted to trading on AIM. Accordingly, the Board is of the view that there may be greater opportunities to raise additional capital in the private markets than remaining as a listed business;

·       there has been limited liquidity in the Ordinary Shares for some time and, consequently, the admission of the Ordinary Shares to trading on AIM does not necessarily offer investors the opportunity to trade in meaningful volumes or with frequency within an active market. With low trading volumes, the Company's share price can move and has moved up or down significantly following trades of disproportionately small volumes of Ordinary Shares. In the opinion of the Directors, the volatile share price is detrimental to the perception of the Group amongst customers, suppliers and other partners, which, in turn, has the potential to negatively impact its product development, staff incentives and morale and industry reputation;

·      the considerable management time, cost and the legal and regulatory burden associated with maintaining the Company's admission to trading on AIM is, in the Directors' opinion and in the light of the above, disproportionate to the benefits of the Company's continued admission to trading on AIM. Given the lower costs associated with private limited company status, it is estimated that the Cancellation and Re-registration will materially reduce the Company's recurring administrative and adviser costs by approximately £500,000 per annum, which the Directors believe can be better spent supporting growth in the Group's business.

Following careful consideration, the Directors therefore believe that it is in the best interests of the Company and Shareholders as a whole to seek the proposed Cancellation and Re-registration at the earliest opportunity.

In addition, in connection with the Re-registration, it is proposed that the New Articles be adopted to reflect the change in the Company's status to a private limited company. The principal effects of the Re-registration and the adoption of the New Articles on the rights and obligations of Shareholders and the Company are summarised in Part 2 of this Document.

3.        Process for, and principal effects of, the Cancellation

The Directors are aware that certain Shareholders may be unable or unwilling to hold Ordinary Shares in the event that the Cancellation is approved and becomes effective. Such Shareholders should consider selling their interests in the market prior to the Cancellation becoming effective.

Under the AIM Rules, the Company is required to give at least 20 clear Business Days' notice of Cancellation. Additionally, Cancellation will not take effect until at least five clear Business Days have passed following the passing of the Cancellation Resolution. If the Cancellation Resolution is passed at the General Meeting, it is proposed that the last day of trading in Ordinary Shares on AIM will be 26 April 2024 and that the Cancellation will take effect at 7.00 a.m. on 29 April 2024.

The principal effects of the Cancellation will include the following:

·        there will be no formal market mechanism enabling the Shareholders to trade Ordinary Shares. Save for the Matched Bargain Facility referred to in paragraph 4.2 below, no other recognised market or trading facility is intended to be put in place to facilitate the trading on the Ordinary Shares;

·       while the Ordinary Shares will remain freely transferable, it is possible that, following the publication of this Document, the liquidity and marketability of the Ordinary Shares will be reduced and their value adversely affected (however, as set out above, the Directors believe that the existing liquidity in the Ordinary Shares is in any event limited);

·      the Ordinary Shares may be more difficult to sell compared to shares of companies traded on AIM (or any other recognised market or trading exchange);

·        in the absence of a formal market and quote, it may be difficult for Shareholders to determine the market value of their investment in the Company at any given time;

·       the regulatory and financial reporting regime applicable to companies whose shares are admitted to trading on AIM will no longer apply;

·        Shareholders will no longer be afforded the protections given by the AIM Rules, such as the requirement to be notified of price sensitive information or certain events and the requirement that the Company seek shareholder approval for certain corporate actions, where applicable, including substantial transactions, reverse takeovers, related party transactions and fundamental changes in the Company's business, including certain acquisitions and disposals;

·       the levels of disclosure and corporate governance within the Company may not be as stringent as for a company quoted on AIM;

·        the Company will no longer be subject to UK MAR regulating inside information and other matters;

·        the Company will no longer be required to publicly disclose any change in major shareholdings in the Company under the Disclosure Guidance and Transparency Rules;

·        the Company will cease to have an independent nominated adviser and broker;

·        whilst the Company's CREST facility will remain in place immediately post the Cancellation, the Company's CREST facility may be cancelled in the future and, although the Ordinary Shares will remain transferable, they may cease to be transferable through CREST (in which case, Shareholders who hold Ordinary Shares in CREST will receive share certificates);

·        stamp duty will be due on transfers of shares and agreements to transfer shares unless a relevant exemption or relief applies to a particular transfer; and

·        the Cancellation and Re-registration may have personal taxation consequences for Shareholders. Shareholders who are in any doubt about their tax position should consult their own professional independent tax adviser.

The above considerations are not exhaustive, and Shareholders should seek their own independent advice when assessing the likely impact of the Cancellation on them.

For the avoidance of doubt, the Company will remain registered with the Registrar of Companies in England and Wales in accordance with and, subject to the Companies Act, notwithstanding the Cancellation and Re-registration.

The Company currently intends to continue to provide certain facilities and services to Shareholders that they currently enjoy as shareholders of an AIM company. The Company will:

·       continue to communicate information about the Company (including annual accounts) to its Shareholders, as required by the Companies Act;

·        continue to hold annual general meetings;

·        continue, for at least 12 months following the Cancellation, to maintain its website, https://www.molecularenergiesplc.com and social media channels and post updates on the each from time to time, although Shareholders should be aware that there will be no obligation on the Company to include all of the information required under the Disclosure Guidance and Transparency Rules, AIM Rule 26 or to update the website as required by the AIM Rules. However, for at least 12 months following Cancellation the Company will publish on its website and via social media any information that the Board considers would have required notification under Rules 10 and 11 of the AIM Rules for Companies; and

·     implement the Matched Bargain Facility which will facilitate Shareholders buying and selling Ordinary Shares on a matched bargain basis following Cancellation.

Alexander Moody-Stuart has confirmed that he intends to resign as a Director of the Company from the date of Cancellation.

The Resolutions to be proposed at the General Meeting include the adoption of the New Articles, with effect from the Re-registration. A summary of the principal differences between the Current Articles and the proposed New Articles is included in Part 2 of this Document. A copy of the New Articles can be viewed at

https://www.molecularenergiesplc.com/investors/aim-rule-26/.

4.      Transactions in the Ordinary Shares prior to and post the proposed Cancellation

4.1          Prior to Cancellation

Shareholders should note that they are able to continue trading in the Ordinary Shares on AIM prior to Cancellation.

4.2          Dealing and settlement arrangements

The Directors are aware that certain Shareholders may wish to acquire or dispose of Ordinary Shares in the Company following the Cancellation.

Therefore, the Company has made arrangements for the Matched Bargain Facility to assist Shareholders to trade in the Ordinary Shares to be put in place from the day of Cancellation if the Resolution is passed. The Matched Bargain Facility will be provided by JP Jenkins Limited ("JP Jenkins"). JP Jenkins is a liquidity venue for unlisted or unquoted assets in companies, enabling shareholders and prospective investors to buy and sell equity on a matched bargain basis. JP Jenkins is a trading name of InfinitX Limited and Appointed Representative of Prosper Capital LLP (FRN453007).

Under the Matched Bargain Facility, Shareholders or persons wishing to acquire or dispose of Ordinary Shares will be able to leave an indication with JP Jenkins, through their stockbroker (JP Jenkins is unable to deal directly with members of the public), of the number of Ordinary Shares that they are prepared to buy or sell at an agreed price. In the event that JP Jenkins is able to match that order with an opposite sell or buy instruction, they would contact both parties and then effect the bargain. Should the Cancellation become effective and the Company put in place the Matched Bargain Facility, details will be made available to Shareholders on the Company's website at https://www.molecularenergiesplc.com/investors and directly by letter or e-mail (where appropriate).

Following Cancellation, the provision of the Matched Bargain Facility will be kept under review by the Board and, in determining whether to continue to offer a Matched Bargain Facility, the Company shall consider expected (and communicated) Shareholder demand for such a facility as well as the composition of the Company's register of members and the costs to the Company and Shareholders.

Peter Levine recognising that Cancellation is not the outcome that Shareholders, including himself, had anticipated at the time of their original investment, has indicated, without commitment or obligation on his part, that, in the fullness of time and subject to the passing of the Resolutions and confirmation that the Takeover Code no longer applies to the Company, he does not rule out making proposals to acquire shares of any shareholders then wishing to dispose of their holdings on terms and conditions to be mutually agreed on a matched bargain basis from time to time.

4.3          Directors' intentions

Each of the Directors has indicated their current intention to retain their Ordinary Shares in the event that the Cancellation is implemented.

5.     Current Trading, Strategy and Prospects

On 1 March 2024, the Company announced an update on various corporate and trading matters. In particular, the Company highlighted that the Tapir x-1 exploration well at the Pirity Concession in Paraguay had been suspended due to drilling difficulties. This well has now been abandoned. The Company, along with its partners in this well, are still reviewing what next steps they should take regarding the Pirity Licence. It is highly probable that the Company will decide to terminate all exploration activities in Paraguay which will lead a complete write off of the Company's investment in that country in the current financial year.

The Company also highlighted that it continues to receive cash contributions from the sale of its former subsidiary, President Petroleum S.A., a company that is ultimately wholly beneficially owned by Peter Levine, the Company's Chairman and largest shareholder. Approximately US$1.28 million has now been paid to Molecular over the last four months and the Company expects that it will continue to receive further funds over the next two and a half years on ad hoc basis subject to the terms and conditions of the original sale agreement. The Company is reliant upon these funds to satisfy the ongoing operational costs of the business and any surplus received above those requirements will be applied to pursue new opportunities for the benefit of all Shareholders. In particular, the Company continues to consider the feasibility of moving into the sustainable aviation fuel business. It is expected that these studies will continue for the next six months before a decision is made to allocate further, more meaningful capital, into this business line.

The Company continues to hold an 18.4 per cent. interest in the issued share capital of Atome plc and is encouraged by the progress that company has made. Shareholders are reminded that this stake in Atome plc acts as security against a loan to the Company from IYA Global Limited, a company wholly beneficially owned by Peter Levine, the Company's Chairman. US$12 million of this loan is outstanding as at the date of this document and would be immediately repayable in the event that Peter Levine or his related parties cease to be the largest shareholder in the Company or if Peter Levine is removed as Chairman of the Company.

As announced on 4 March 2024, Green House, the Company's 75 per cent. carbon removal and mitigation subsidiary, has made significant commercial progress in each of its businesses. Moreover, Green House has received advanced assurance for prospective EIS investment under the UK government initiative which encourages investment in qualifying early-stage companies by offering tax benefits to qualifying investors who subscribe for new shares in Green House. Due to the continued challenging public market conditions, the Directors have decided that it is not in the best interests of the Company or its Shareholders to pursue an IPO of Green House on AIM at this time. The Directors will consider options for this independently run business in due course.

6.     Re-registration

As set out above, following the Cancellation, the Directors believe that the requirements and associated costs of the Company maintaining its public company status will be difficult to justify and that the Company will benefit from the more flexible requirements and lower costs associated with private limited company status. It is therefore proposed to re-register the Company as a private limited company. In connection with the Re-registration, it is proposed that the New Articles be adopted to reflect the change in the Company's status to a private limited company. The principal effects of the Re-registration and the adoption of the New Articles on the rights and obligations of Shareholders and the Company are summarised in Part 2 of this Document.

An application will be made to the Registrar of Companies for the Company to be re-registered as a private limited company. Re-registration will take effect when the Registrar of Companies issues a certificate of incorporation on Re-registration. The Registrar of Companies will issue the certificate of incorporation on Re-registration when it is satisfied that no valid application can be made to cancel the resolution to re-register as a private limited company or that any such application to cancel the resolution to re-register as a private limited company has been determined and confirmed by the Court.

7.      Takeover Code

The Takeover Code applies to all offers for companies which have their registered offices in the United Kingdom, the Channel Islands or the Isle of Man if any of their equity share capital or other transferable securities carrying voting rights are admitted to trading on a UK regulated market or a UK multilateral trading facility or on any stock exchange in the Channel Islands or the Isle of Man. The Takeover Code also applies to all offers for companies (both public and private) which have their registered offices in the United Kingdom, the Channel Islands or the Isle of Man and which are considered by the Panel to have their place of central management and control in the United Kingdom, the Channel Islands or the Isle of Man, but in relation to private companies only if one of a number of conditions is met - for example, if the company's shares were admitted to trading on a UK regulated market or a UK multilateral trading facility or on any stock exchange in the Channel Islands or the Isle of Man at any time in the preceding ten years.

If the Cancellation and Re-registration are approved by Shareholders at the General Meeting, the Company will be re-registered as a private company and its securities will no longer be admitted to trading on a regulated market or a multilateral trading facility in the United Kingdom. In these circumstances, the Takeover Code will only apply to the Company if it is considered by the Panel to have its place of central management and control in the United Kingdom, the Channel Islands or the Isle of Man. This is known as the "residency test". In determining whether the residency test is satisfied, the Panel has regard primarily to whether a majority of a company's directors are resident in these jurisdictions.

The Panel has confirmed to the Company that, on the basis of the current residency of the Directors and in light of the proposed resignation of Alexander Moody-Stuart, the Company will not have its place of central management and control in the United Kingdom following this resignation and the Cancellation and Re-registration. As a result, in the event that the Cancellation and Re-registration are approved by Shareholders at the General Meeting and become effective, the Takeover Code will cease to apply to the Company and Shareholders will no longer be afforded the protections provided by the Takeover Code. This includes, but is not limited to, the requirement for a mandatory cash offer to be made if either:

·       a person acquires an interest in shares which, when taken together with the shares in which persons acting in concert with it are interested, increases the percentage of shares carrying voting rights in which it is interested to 30 per cent. or more; or

·       a person, together with persons acting in concert with it, is interested in shares which in the aggregate carry not less than 30 per cent. of the voting rights of a company but does not hold shares carrying more than 50 per cent. of such voting rights and such person, or any person acting in concert with it, acquires an interest in any other shares which increases the percentage of shares carrying voting rights in which it is interested.

The Company notes that Peter Levine has notified the Company, without commitment, that, subject to the passing of the Resolutions and confirmation that the Takeover Code no longer applies to the Company, he may make proposals to acquire shares of any shareholders then wishing to dispose of their holdings on terms and conditions to be mutually agreed on a matched bargain basis from time to time. Shareholders should be aware that, in such circumstances and, if as a consequence the interests of Peter Levine and those persons acting in concert with him carry 30 per cent. or more of the voting rights of the Company, Peter Levine and those persons acting in concert with him would not be required to make a mandatory general cash offer to all Shareholders.

A summary of the protections afforded to Shareholders by the Takeover Code which will be lost by virtue of the above proposals is set out in Part 3 of this Document.

8.      Process for Cancellation

Under the AIM Rules, it is a requirement that the Cancellation must be approved by Shareholders holding not less than 75 per cent. of votes cast by Shareholders at the General Meeting. Accordingly, the Notice of General Meeting set out in Part 4 of this Document contains a special resolution to approve the Cancellation.

Furthermore, Rule 41 of the AIM Rules requires any AIM company that wishes the London Stock Exchange to cancel the admission of its shares to trading on AIM to notify shareholders and to separately inform the London Stock Exchange of its preferred cancellation date at least 20 Business Days prior to such date. In accordance with AIM Rule 41, the Directors have notified the London Stock Exchange of the Company's intention, subject to the Cancellation Resolution being passed at the General Meeting, to cancel the Company's admission of the Ordinary Shares to trading on AIM on 29 April 2024. Accordingly, if the Cancellation Resolution is passed, the Cancellation will become effective at 7.00 a.m. on 29 April 2024. If the Cancellation becomes effective, Cavendish will cease to be nominated adviser of the Company and the Company will no longer be required to comply with the AIM Rules.

9.      General Meeting

The General Meeting will be held at Carrwood Park, Selby Road, Leeds, LS15 4LG at 11.00 a.m. on 15 April 2024.

Resolution 1 to be proposed at the General Meeting is a special resolution to approve the Cancellation.

Resolution 2 to be proposed at the General Meeting is a special resolution to re-register the Company as a private company and to approve the adoption by the Company of new articles of association.

Resolution 1 is not conditional on Resolution 2 but Resolution 2 is conditional on Resolution 1.

10.    Action to be taken in relation to the General Meeting

To be valid, the accompanying Form of Proxy for use in connection with the General Meeting must be completed, signed and returned in accordance with the instructions printed thereon so as to be received by the Company's Registrars, Equiniti Limited, Aspect House, Spencer Road, Lancing, West Sussex, BN99 6DA as soon as possible and, in any event, by no later than 11.00 a.m. on 11 April 2024 (or, if the General Meeting is adjourned, 48 hours before the time fixed for the adjourned meeting excluding non-working days).

Where Ordinary Shares are held in CREST, via CREST. To be valid, notwithstanding the method of appointment, a proxy appointment must be returned/transmitted so as to be received by the Registrars as soon as possible and, in any event, by no later than 11.00 a.m. on 11 April 2024 (or, if the General Meeting is adjourned, 48 hours before the time fixed for the adjourned meeting excluding non-working days). For further details on how to submit a proxy appointment, please see the notes to the Notice of General Meeting at the end of this Document.

11.    Recommendation

The Directors consider that the Cancellation and the Re-registration and adoption of the New Articles are in the best interests of the Company and its Shareholders as a whole and, therefore, unanimously recommend that you vote in favour of the Resolutions at the General Meeting as each of the Directors intends to vote, or procure the vote, in respect of, in aggregate, 3,070,594 Ordinary Shares to which they are beneficially entitled.

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