Locality Planning Energy Holdings Limited (ASX:LPE) has announced the Bundaberg BioHub Pty Ltd (BioHub) has secured construction funding to develop the BioHub, delivering avenues for it to repay the $6.1 million debt it owes LPE circa, anticipated to be paid in full during the first half of 2024.
LPE has reached an agreement with the BioHub to extend the repayment date for the full $6.1 million capital works fund ($5 million in capital works fund plus capitalised accrued interest and other costs).
The repayment date has now been extended to the 28 June 2024, and is agreed upon by both parties.
As part of the revised arrangement, all outstanding interest and legal costs as of the end of December 2023 have been capitalised into the capital works funds and, as of the first of January 2024, the total amount is $6,158,082.20.
The total debt will continue to accrue interest at a rate of 15% per annum, accruing daily.
If BioHub do not pay LPE the full amount of the capital works fund on or before the due date, default interest will be payable on the outstanding amount, calculated at an increased rate of 22.5% per annum (accruing daily) for the remaining period where the loan is outstanding and overdue.
The BioHub has paid LPE an advance value of $230,295.40, which will cover the interest accrued from the first of January 2024 to the 31st of March.
LPE anticipates $76,375.71 on 30th April, and another $78,937.82 on 31st May, as payment for the interest accrued in each of these months.
LPE retains its second registered mortgage security interest in the BioHub however, during the construction phase and draw down of funding from the construction lender, LPE is subject to certain restrictions in relation to the exercise of its security.
Now that the funding has been secured, construction of the BioHub will commence, increasing the Project valuation to $30 million (the “as if complete” valuation) which works to further strengthen LPE’s second mortgage security position.
LPE Chairman Justin Pettett commented on the announcement.
“The Board has taken a flexible and pragmatic approach towards working with Bundaberg BioHub in order to secure a realistic pathway to ensure the $6.1m Total Debt is fully repaid together with the 15% annualised interest rate,” he said.
“With construction funding already secured for Bundaberg BioHub, coupled with Q1 2024’s interest pre-payment, the Board is optimistic that it will be fully repaid by mid-2024.”
LPE’s Australian Stock Exchange-listed share price has risen 20% and is currently trading at $0.042 (9.00am UTC+ 8 hours).