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20 Feb 2009 10:00
Plant Impact plc
("Plant Impact" or the "Company")
Plant Impact Enters into Exclusive Discussions on Global Licensing of BugOil®
Plant Impact (AIM:PIM), a developer of technologies that improve crop productivity is pleased to announce that on 18 February 2009 it entered into exclusive detailed discussions with one of the world's top 10 agrochemical companies by revenue (the "Third Party") for the global licensing of BugOil® through the signing of a non-binding letter of intent ("Letter of Intent") and into a loan agreement with the Third Party for £750,000 ("Loan Agreement").
The Third Party has carried out evaluation trials on BugOil® to confirm efficacy and market potential. The intention is to progress to a licensing agreement to be finalised during the first half of 2009. Under the terms of the proposed licensing agreement, the Third Party would have an exclusive licence to the patents, patent applications and know-how and other trade secrets of BugOil® and to manufacture and market BugOil® globally in all market segments except home and garden and animal health. It is proposed that the licence will be for a term of 20 years (or if sooner the expiration of the relevant patents) and that the Third Party will make payments to Plant Impact in accordance with agreed milestones as well as royalties upon sales.
Plant Impact and the Third Party are also in discussions regarding access to distribution rights for certain plant nutrient technologies and products owned by Plant Impact.
Under the terms of the Loan Agreement the Third Party will make a loan of £750,000 to Plant Impact to be drawn down over a period of 180 days following the date of the Loan Agreement. Interest will accrue on the loan at a variable rate of LIBOR plus 3% per annum. The outstanding principal balance, plus all accrued interest, will be repayable in full over three years following the date of the Loan Agreement. The Third Party may elect to offset up to 50% of any royalty payments due under the licensing agreement proposed against interest and principal outstanding under the loan. The loan will be secured against the intellectual property of Plant Impact.
The Chief Executive Officer of the Third Party said: "We have grown rapidly over the past years through the development and introduction of innovative products which match the needs of our customers. We are delighted to be working with Plant Impact, to develop and market their products around the world. BugOil® is an ideal candidate product for us in that it is innovative, effective and environmentally friendly and primarily aimed at our core horticulture (fruit and vegetable) crop markets. We look forward to completing the development of BugOil® and bringing it to market to the benefit of our customers around the world"
Commenting on the exchange of the Letter of Intent and the signing of the Loan Agreement, Peter Blezard CEO of Plant Impact said: "This is a very important milestone for the Company as it shows the level of confidence that a major global company has in the environmentally friendly products that we develop to help maximise agricultural production. "
For further information, please contact:
Peter Blezard Tel: +44 (0) 1772 645 164
CEO
Plant Impact
Anna Dunphy / Tristan Jervis Tel: +44 (0) 207 861 3838
Financial PR/IR
De Facto Communications
Emily Morgan Tel: +44 (0) 1275 871717
Nick Harriss Tel: +44 (0) 207 489 4500
Blomfield Corporate Finance Limited.
The Third Party
The Third Party is one of the world's top 10 agrochemical companies by revenue. An entrepreneurial provider of crop protection and life science products in more than 125 countries worldwide, the Third Party specialises in marketing and distribution of respected crop protection brands and life science products in harmony with the needs of global partners.
About Plant Impact plc
Plant Impact addresses the increasing global demand for effective, sustainable and ecologically-sound products to combat environmental plant stress and improve crop productivity. Common environmental plant stresses include drought, salinity, nutrient deficiencies, pests and disease. Plant Impact's advances produce practical results that reduce inputs and benefit the whole of the agricultural value chain, providing solutions for growers, food manufacturers and consumers.
A broad product portfolio has been developed using these innovative and proprietary technologies, the most advanced of which are already being marketed and sold through established agricultural distribution networks. Products for the home and garden market are also distributed direct to consumers through reputable high street stores.
About BugOil®
BugOil® is a benign insect and mite control agent derived from essential plant oil technology that offers highly effective control in a non-toxic, environmentally friendly method. The pests targeted by BugOil® are mites, whitefly, thrips and aphids; these pests are some of the most damaging and most difficult to control as they reproduce quickly in mass numbers and can build resistance to conventional pest control agents.
Independent field trials conducted on BugOil® have demonstrated that the product has pest control abilities at least equal to, if not better, than those of current industry-standard insecticides. BugOil® also provides broad-spectrum pest coverage, particularly for ornamentals such as cut flowers. All field trials were conducted to regulatory standard by independent third parties on high-value crops such as ornamentals, fruit and vegetables. To date, successful field trials have been conducted on BugOil® in the USA, UK, Europe and Africa.
BugOil® technology:
high level of efficacy equivalent to most current synthetic standards;
based totally on natural plant extracts;
safe for many non-target organisms including mammals, fish, birds, and most beneficial insects (bees, earthworms, lacewings, ladybirds); and
non-toxic and environmentally friendly.
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