Toople Plc Share News (TOOP)

(Sharecast News) - Small business telecoms specialist Toople has raised gross proceeds of £0.66m from the placing of 189,208,896 new ordinary shares at a price of 0.35p per share, it announced on Tuesday.The London-listed firm said it was proposing to use the funds to redeem the outstanding loan from David Breith at a "substantial" discount to its book value, as well investing further in the business to accelerate the sign up of new customers, who - over the life of their fixed term contracts - would contribute to increased revenues for the company.It said the loan originated when Breith lent funds to Toople when he was a director.At the time of the company's admission to the London Stock Exchange in May 2016, Breith had made loans totalling £0.75m to the firm, and prior to admission, he entered into an agreement to formalise the loan such that it was interest-free and not repayable for three years from admission, and then only in the event that the company was in profit and has sufficient funds to make the repayment.In May 2017, the company and Breith entered into a deed of variation to restate the balance owed under the Loan to £0.61m, with all other terms remaining in place.The conditions for repayment of the loan had not yet been met, and so the amount outstanding remained at the restated balance of £0.61m, and was disclosed at a present value of £0.6m in the 2019 interim results based on current IFRS standards.Breith had now agreed to accept a payment of £0.15m in full and final settlement of the loan, subject to that payment being made by 31 May."We were approached by our brokers, who had received demand from their clients to invest further in our business as they are pleased with the substantial financial and operational progress we have made in the last 12 months," said Toople CEO Andy Hollingworth."Given the demand and the opportunity to repay the company's debt at a significant discount to book value, the board believes that the placing is very much in the interest of all shareholders."We were delighted that investor interest was such that the placing utilised all of the share authorities that were granted at the recent AGM."Hollingworth said that once the loan was repaid, the company would use the remaining funds raised to invest further in its digital marketing strategy to increase the rate of customer enquiries, and correspondingly to improve conversion rates."Given that these customers are typically signing two year fixed contracts, we believe that the company can use this opportunity to accelerate its time frame to cash generation and profitability."