Active Energy Regulatory News (AEG)

Active Energy Group Plc / EPIC: AEG / Sector: Alternative Energy

24 November 2016

Active Energy Group plc ("Active Energy", "AEG" or the "Company")

Issue of Equity to Major Investor and CoalSwitch JVA Partners

Active Energy, the London quoted renewable energy, forestry management and timber processing business, announces that following the General Meeting ('GM') on 16 November 2016, a total of 88,722,779 ordinary shares of £0.01 each in the Company ("Ordinary Shares") have been issued at 2.65p per Ordinary Share and a further 29,287,159 shares have been allotted from the 62,500,000 Ordinary Shares that are currently held in treasury (the "Treasury Shares") at 2.65p, as set out below:

· In consideration of its agreement to convert US$1.4 million of existing debt in the Company, into equity, major shareholder and long-term supporter, Gravendonck Private Foundation ("Gravendonck"), has been issued 42,398,809 Ordinary Shares (the "Gravendonck Conversion"). Following the Gravendonck Conversion, Gravendonck will hold 211,898,809 Ordinary Shares, representing 27.27% of the enlarged issued share capital of Active Energy with voting rights;

· To further consolidate control of CoalSwitch with AEG, and in consideration of an agreement reached with Trident Asset Management Resources Limited ("Trident Limited") - the operating company which introduced the CoalSwitch opportunity to AEG - Trident Limited has been issued 46,323,970 Ordinary Shares in return for their 15% interest in the joint venture agreement between Biomass Energy Enhancements LLC ("BEE") and AEG (the "Trident Share Exchange"). Following the Trident Share Exchange, Trident Limited will hold 46,323,970 Ordinary Shares, representing 5.96% of the enlarged issued share capital of Active Energy with voting rights;

· In consideration of the agreement reached with the majority of shareholders in Biomass Energy Enhancements LLC ("BEE") to sell their BEE shares to Active Energy in return for Ordinary Shares in the Company (the "BEE Share Exchange"), 29,287,159 Ordinary Shares will be allotted to key participants in the CoalSwitch Joint Venture Agreement (the "JVA"), representing in aggregate 3.77% of the enlarged issued share capital of Active Energy with voting rights. The BEE Share Exchange will be conducted in three tranches according to the development of the CoalSwitch business and this represents the first tranche of shares. As previously stated, the Company will utilise the Treasury Shares to settle the first tranche and will apply the remainder of the Treasury Shares to settle the second tranche in full and part of the third tranche. The settlement of the first tranche, coupled with the completion of certain other conditions precedent to secure control of the CoalSwitch business and bring it wholly within the Group, results in the termination of the JVA;

· Key participants in the BEE Share Exchange include:

o Sandy Munro - Founder of Munro & Associates (http://leandesign.com/); provider of key technical advice on the development process for CoalSwitch; and

o Philip Scalzo - Inventor & founder of the CoalSwitch technology and all key members of the engineering and business development team.

Please note that all conversions from US$ to £ as part of the process were calculated at the £:US$ exchange rate of 1.24603 on 23 November 2016.

Richard Spinks, Chief Executive Officer of Active Energy said: "The transactions which we have executed today align our major shareholder and the key participants in the development of CoalSwitch with AEG investors. I believe that their decision to receive equity in our Company is testament to their recognition of the significant upside available via commercialisation of the CoalSwitch technology, which is proven to be a unique and effective biomass based drop-in coal replacement fuel that negates the need for coal fired power stations to carry out expensive retrofit programmes. We are pleased to welcome the key participants to our company and, with the combined team's sights set firmly on securing customers for this innovative product, I look forward to providing all our shareholders with updates in the coming months."

AIM Admission

Pursuant to the Gravendonck Conversion, the Trident Share Exchange and the first tranche of the BEE Share Exchange, application has been made for 88,722,779 Ordinary Shares, which will rank pari passu with the existing Ordinary Shares, to be admitted to trading on AIM and it is expected that this will take place on or around 29 November 2016 ("Admission").

Total Voting Rights

Following Admission, the Company's enlarged issued share capital will comprise 810,381,500 Ordinary Shares. The Company will hold 33,212,841 Treasury Shares and the figure of 777,168,659 Ordinary Shares may therefore be used by shareholders in the Company as the denominator for the calculations by which they will determine if they are required to notify their interest in, or a change in their interest in, the share capital of the Company under the FCA's Disclosure and Transparency Rules.

This announcement contains inside information for the purposes of Article 7 of Regulation (EU) 596/2014.

**ENDS**

Enquiries & Further Information

About Active Energy Group

Active Energy Group Plc ("Active Energy" or "AEG") is an AIM quoted company operating internationally across the entire timber supply chain - from forest to factory and fuel.

Active Energy's vertically-integrated business units provide timberland development services for forestry owners, industrial wood fibre for MDF manufacturers, and second-generation biomass coal replacement fuels for industrial power generators.

Active Energy has three divisions:

· AEG TimberLands: Forestry Asset Management and Development

· AEG WoodFibre: Industrial Wood Fibre for Medium-Density Fibreboard (MDF) Manufacturing

· AEG CoalSwitch: Advanced Biomass Coal Replacement Fuels and Fuel Processing Systems

Active Energy's relationships with forestry owners through its AEG TimberLands operation allows the Company to maximise the value of its standing timber assets, converting low-grade material - primarily non-saw logs/technical lumber and forestry thinnings - into industrial wood fibre for MDF manufacturing via Active Energy's AEG WoodFibre division. This vertically integrated model also provides feedstock for the Company's AEG CoalSwitch joint venture, which generates green energy power generation from biomass.