Europlasma: Progress and Financing for the Development of CHO-Power(R) Power Production UnitsBy Europlasma, PRNE
Sunday, June 13, 2010
PARIS, June 14, 2010 - After signing the letter of intent in April 2010 with a fund
specialised in renewable energies for the development of CHO-Power
activities, Europlasma, the French group specialized in clean technologies
and renewable energy production, is reporting on progress made with the
project to develop the Morcenx biomass power production plant and is
announcing various developments in relation to the strategic approach
Progress made with the Morcenx CHO-Power unit
The CHO-Power production unit is a unique concept in the world
of energy reclamation from residual waste and/or biomass, based on the
gasification technique and improved with the technological advances enabled
by the plasma torch.
Following the announcement on April 8th, 2010 concerning the
signing of a letter of intent, the administrative due diligence processes
have been finalized and the Board of Directors has validated the term
sheet project with Europlasma's financial partner. The next steps (in June
2010) will focus on finalizing the legal and administrative procedures to
ratify the partnership between Europlasma and the investment fund.
At this stage, the principles retained for financing the
project provide for a total of EUR36 million of resources over 30 months,
with EUR12.7 million to be covered by Europlasma. More specifically, a part
of the Europlasma contribution will enable the Group to have a 25% capital
stake in CHO-Power Morcenx as soon as work begins to build the CHO-Power
plant in Morcenx, a 12 MWe unit production capacity. In addition, under a
performance incentive mechanism, Europlasma may increase its interest in
CHO-Power Morcenx up to 45%. Meanwhile, the EPC contract (Engineering,
Procurement & Construction) of the CHO-Power Morcenx plant, will represent
approximately 15 million EUR of revenues in 2010 for Europlasma, with the
civil work beginning in July. The contribution of the capital financed by
Europlasma is needed for the definitive sealing of the agreement and the
project's operational launch.
Overall the financing process will be dedicated to building
CHO-Power production units with a capacity of 54 MWe over three years, with
the option to extend this financing to cover the building of a total of 200
MWe over five years. As a result, the Group's financial partner will be able
to contribute EUR50 million.
Europlasma's strategy for implementing the definitive agreement
Strengthening its capital: In connection with its April 8th,
2010 communication, Europlasma was looking to finance its contribution with
the increase in equity capital resulting mainly from the exercising of
existing warrants (BSA). Faced with a difficult market environment, the
majority of these warrants have not been exercised and expired on May 31st,
2010. In this context, the Board of Directors now intends to carry out a
capital increase. Indeed, out of the EUR12.7 million financed by Europlasma,
the Company will be inviting its shareholders and the financial market to
accompany it in this final development phase for EUR6 million. The various
possibilities reviewed by the Board of Directors revealed that, despite a
comfortable level of cash flow, the investment needed could not be covered in
full by Europlasma without undermining the Group's current business. In this
way, two operations, backed by the Company's main shareholders, could be
- a first issue, with preferential subscription rights maintained, open to all shareholders for a total of approximately EUR2 million, and - a second issue, reserved for qualified investors, for EUR4 million. Moreover, this issue would result in preferred shares being created, with the corresponding rights being exclusively political, no special financial rights being granted.
The delegations of authority prior to carrying out the private
placement (second operation presented above) and therefore finalizing the
financing of the first CHO-Power Morcenx project will be submitted for
approval by shareholders at the General Meeting on June 30th, 2010. The
projects are presented in detail in the "Board of Directors' report for the
Ordinary and Extraordinary General Meeting on June 30th, 2010", available on
Europlasma's internet site.
As Didier Pineau explains: "This is a key step for the launch
of the first CHO-Power plant. The market context is difficult, but we must
continue moving forward in order to confirm this outstanding opportunity for
development in the field of renewable energy production. The Company's
management team is fully committed to completing this final stage, which
Europlasma will contribute towards; at the same time, we have looked into the
solutions that will enable us to not only engage our shareholders in the
operation, but also meet the needs for speed and maximizing the funds raised
by calling on professional investors."
Modifying its governance: Following on from the structuring
initiatives launched in 2009 to further strengthen the Group's governance and
organization (creation of four permanent committees) and with a view to
the development of CHO-Power units, new measures would have to be
- Separating the functions of Chairman and Chief Executive Officer. Mr. Didier Pineau will devote himself entirely to his position as the Group's Chief Executive Officer once the capital increase has been carried out. A Chairman of the Board of Directors will be appointed at a coming Board meeting. - Appointing a new director, Mr. Erik Martel, representing Credit Suisse Europlasma SPV LLC, Europlasma's leading shareholder. - Appointing Mr. Pierre Catlin, a member of the Strategy and Investment Committee, as an independent director.
Further to these appointments, the Board of Directors would
have six members, including two independent directors.
Furthermore, Cedric Berard, Europlasma's Chief Legal and
Financial Officer, is leaving the Group to pursue a new activity in capital
development. Since CHO-Power's financing is currently being finalized, Mr.
Berard has successfully completed his main mission. He has also played an
effective role in improving the profitability of the Group and its companies.
A process to recruit a new Chief Financial Officer is already underway.
Founded in 1992, Europlasma is a French Group specialized in clean
technologies and renewable energy production. The Europlasma Group is made up
of four main units and 260 employees who are all firmly committed to
sustainable development and experts in waste processing and reclamation.
- Europlasma develops, produces and markets waste processing and energy production solutions based on its proprietary plasma torch technology. - Inertam is the global specialist for the destruction and reclamation of asbestos and hazardous waste. - CHO Power is a waste gasification power producer (EfW - Electricity from Waste). - Europe Environnement is the European market leader for ventilation and air depollution systems for industry.
[www.europlasma.com] [Alternext - NYSE Euronext
Paris - Ticker: ALEUP - ISIN: FR0000044810]
 Term sheet: main terms and conditions for investment.
 The rights associated with preferred shares are to: (i) participate
in the Company's governance through a directorship that would be awarded to
them; (ii) approve beforehand certain deeds for arrangements that might
deprive the Company of its essential assets or a substantial part of them.
In return for these rights, the period for which would be limited to
three years, two constraints would apply for investors taking part in the
private placement: (i) the requirement to hold such shares on a registered
basis (at the risk of losing the corresponding rights) ;(ii) the fact that
there would be no listing on Alternext for the preferred shares; (iii) the
impossibility to subscribe to or to be awarded new preferred shares.
 Accounts Committee, Appointments and Compensation Committee, Strategy
and Investment Committee, Scientific Committee.
Press and investor contacts Europlasma Didier Pineau / Anne Borderes email@example.com Tel: +33-5-56-74-73-72 Atout Capital Finance Eric Parent / Melanie Bonanno firstname.lastname@example.org Tel: +33-1-56-69-61-81 Calyptus Marie Ein / Alexis Breton email@example.com Tel: +33-1-53-65-68-68
Press and investor contacts: Europlasma, Didier Pineau / Anne Borderes, contactbourse at europlasma.com, Tel: +33-5-56-74-73-72; Atout Capital Finance, Eric Parent / Melanie Bonanno, melanie.bonanno at atoutcapital.com, Tel: +33-1-56-69-61-81; Calyptus, Marie Ein / Alexis Breton, europlasma at calyptus.net, Tel: +33-1-53-65-68-68
Tags: Europlasma, France, June 14, Paris