Amendments to Employment Incentive Warrant Pool

22 December 2022

EQTEC plc

("EQTEC", the "Company" or the "Group")

Amendments to Employment Incentive Warrant Pool

Issue of Warrants to Director

EQTEC plc (AIM: EQT), a global technology innovator powering distributed, decarbonised, new energy infrastructure through its waste-to-value solutions for hydrogen, biofuels, and energy generation announces amendments to the Company's Employment Incentive Warrant Pool (the "EIWP").

The Company on 31 March 2020 announced creation of the EIWP to incentivise and retain key managers throughout a challenging and transformational period. The EIWP allowed for issue of up to 590,906,437 warrants ("EIWP Warrants") over new ordinary shares of €0.001 each in the Company ("Ordinary Shares") to directors and employees, exerciseable for 36 months from the date the EIWP was created. The exercise price of the EIWP Warrants was set at £0.0025 per Ordinary Share, representing, at the time, a premium of 43% to the middle market closing price of the Company's Ordinary Shares.

To date, 519,609,299 EIWP Warrants have been allocated, including 196,968,812 EIWP Warrants allocated to CEO David Palumbo and 98,484,406 EIWP Warrants allocated to CTO Yoel Alemán, with an unallocated balance of 71,297,138 EIWP Warrants.  The total amount of unexercised warrants stands at 404,325,407 representing 4.29% of the Company's Issued Share Capital (inclusive of the allocation to Jeffrey Vander Linden below) .

The Company's Board of Directors has agreed to extend the existing EIWP through an increasingly challenging and transformational period. To bring the EIWP in line with current market performance, the Company has amended its terms as follows:

·    The EIWP Warrant exercise period will be extended by 24 months, to 31 March 2025.

·    The EIWP Warrant exercise price will be increased to £0.0045 per Ordinary Share, representing a premium of 60% to the market closing price on 21 December 2022.

·    From 22 December 2022 EIWP Warrantholders will only be allowed to exercise their EIWP Warrants subject to the following conditions:

o 

o  The Company's share price at the time of exercise has been £0.0075 or greater for a minimum of 30 consecutive days in the period from today through to the date of exercise.

o  The warrantholder remains a director or employee of the Company in good standing at the time of exercise.

Additionally, the Company is allocating 71,297,138 EIWP Warrants to Jeffrey Vander Linden, COO. Consequently, the EIWP Warrant pool is fully allocated.

Ian Pearson, Chairman of EQTEC, commented:

"The last 24 months have been unprecedented in terms of market volatility and equity market correction, especially for technology stocks. On the other hand, the market demand for EQTEC technology and the sector in general is poised to be one of the most exciting areas of growth in the coming years, as the world replaces legacy waste management and energy infrastructure with new technologies that will dominate the future, redressing our dependency on fossil fuels. The current management team is part-way through delivering our growth strategy. Meaningful incentivisation is important to ensure the retention of key management to support the successful delivery of the strategy we have set,  to springboard the Company towards a position as a world-class licensor of leading-edge technology for carbon-efficient conversion of waste into baseload energy and biofuels. The Board believes this amendment of the EIWP, without the addition of any new Warrants, is a pragmatic way to support business continuity and growth."

Related party transaction

As Directors of the Company, David Palumbo, Yoel Alemán and Jeffrey Vander Linden are considered related parties under the AIM Rules for Companies ("AIM Rules").  As a result, the amendment of the EIWP Warrants and, in relation to Mr Vander Linden, the allocation of EIWP Warrants, constitutes a related party transaction pursuant to Rule 13 of the AIM Rules.  The Directors independent of the transaction (being the Directors other than David Palumbo, Yoel Alemán and Jeffrey Vander Linden) consider, having consulted with the Company's Nominated Adviser, Strand Hanson Limited, that the terms of the amendment of the EIWP Warrants, and EIWP Warrant allocation, are fair and reasonable in so far as the Company's shareholders are concerned.

This announcement contains inside information as defined in Article 7 of the EU Market Abuse Regulation No 596/2014, as it forms part of United Kingdom domestic law by virtue of the European Union (Withdrawal) Act 2018, as amended, and has been announced in accordance with the Company's obligations under Article 17 of that Regulation.

ENQUIRIES

About the project

The Project Site is in a heavily industrialised area, adjacent to major plant facilities and estates, including those of CF Fertilisers UK Limited, Seqens Group pharmaceuticals and many others. Through its wholly owned project SPV, Haverton WTV, the Company has secured all relevant permits and permissions to build a refuse-derived fuel ("RDF")-to-combined heat and power ("CHP") facility that would transform 200,000 tonnes per year of RDF into up to 25MW of electricity for export to the national grid, with the potential for creating up to 34MW of thermal energy. The Company has agreed favourable heads of terms for over 250 per cent of its required volume of feedstock, secured the contract for a grid connection and is now pursuing discussions with neighbouring companies about provision of private wire offtake.

On 13 December 2021, the Company confirmed it was investigating new offtake opportunities for the Project and that it was working with partners toward feasibility work. On 18 July 2022, the Company announced that it had selected Petrofac as its front-end engineering design ("FEED") contractor, further confirming that, following full review of multiple financial models for the Project, technical feasibilities and updated site drawings, the Company and its partners were considering a range of additional facilities including for hydrogen production, battery storage and/or hydrogen refuelling. All such options would be subject to further planning permission and agreement of future owners of the Project, which the Company intends to sell in whole or in part.

The primary focus of the Company now is pursuit of Project investors to support FEED work on the CHP facility and development of the several other potential facilities on the site.

About EQTEC plc

As one of the world's most experienced gasification technology and engineering companies, with a growing track record of delivering operational and commercial success for transforming waste-to-energy through best-in-class technology innovation, engineering and project development, EQTEC brings together design innovation, project delivery discipline and solid commercial experience to add momentum to the global energy transition. EQTEC's proven, proprietary and patented technology is at the centre of clean energy projects, sourcing local waste, championing local businesses, creating local jobs and supporting the transition to localised, decentralised and resilient energy systems.

EQTEC designs, supplies and builds advanced gasification facilities in the UK, EU and US, with highly efficient equipment that is modular and scalable from 1MW to 30MW. EQTEC's versatile solutions process over 50 varieties of feedstock, including forestry wood waste, vegetation and other agricultural waste from farmers, industrial waste and sludge from factories and municipal waste, all with no hazardous or toxic emissions. EQTEC's solutions produce a pure, high-quality synthesis gas ("syngas") that can be used for the widest range of applications, including the generation of electricity and heat, production of synthetic natural gas (through methanation) or biofuels (through Fischer-Tropsch, gas-to-liquid processing) and reforming of hydrogen.

EQTEC's technology integration capabilities enable the Group to lead collaborative ecosystems of qualified partners and to build sustainable waste reduction and green energy infrastructure around the world.

The Company is quoted on AIM (ticker: EQT) and the London Stock Exchange has awarded EQTEC the Green Economy Mark, which recognises listed companies with 50% or more of revenues from environmental/green solutions.

Further information on the Company can be found at www.eqtec.com.

The notification below, made in accordance with the requirements of the EU Market Abuse Regulation, provides further detail in respect of the transaction as described above.