Vela Technologies Regulatory News (VELA)

This announcement contains inside information for the purposes of Article 7 of the Market Abuse Regulation (596/2014/EU) as it forms part of UK domestic law by virtue of the European Union (Withdrawal) Act 2018.

23 May 2023

Vela Technologies plc

("Vela" or "the Company")

Investment in Tribe Technology Group Limited

The Board of Vela (AIM: VELA), an AIM-quoted investing company focused on early-stage and pre-IPO disruptive technology investments, announces that the Company has entered into an agreement to invest £250,000 in Belfast-based Tribe Technology Group Limited ("Tribe Tech"). The minority investment is being made as part of a c.£2.0 million pre-IPO funding round undertaken by Tribe Tech.

Further information on Tribe Tech

Founded in 2019, with operations in Northern Ireland and Western Australia, Tribe Tech was created to disrupt the minerals exploration drilling industry by reducing drilling costs and removing human operators from what is a highly manual process. Tribe Tech's technology, incorporating the Tribe Technology Drilling System (TTDS®), is expected, through partnerships with some of the industry's biggest players, to increase productivity, reduce costs and improve safety in the global mining industry.

Tribe Tech offers a new level of autonomous Reverse Circulation ("RC") drilling at a time when the discovery of additional mineral deposits is crucial to fuel the renewable energy transition.

Tribe Tech has developed an IP portfolio which includes a number of trademark and patent applications, together with a registered trademark and trade secrets (software, control system). Tribe Tech also has strong working relationships with key players in Western Australia's Pilbara iron ore market and has leveraged these connections to build market traction.

In 2021 Tribe Tech received £1.0 million in employment grant funding from Invest Northern Ireland to support the establishment of its design and manufacturing facility in Mallusk, Northern Ireland. Tribe Tech's 20,000 square feet production facility has capacity for future growth, is close to specialist supply chains and has access to motorway and ports.

Tribe Tech currently has a number of strategic partnerships and a commercial pipeline that includes delivery of TTDS® and autonomous RC drill rigs to market-leading drilling contractors and major miners upgrading their fleet.

Tribe Tech is currently in the process of pursuing a listing on a public market in London ("Admission") using a planned new holding company ("Tribe Tech Holdco").

For the year ended 30 June 2022, Tribe Tech reported a loss after tax of £1.69 million. As at 30 June 2022, Tribe Tech's net liabilities were £1.22 million.

Details of the investment in Tribe Tech

Vela has agreed to invest £250,000 in Tribe Tech, to be satisfied shortly from the Company's existing cash resources, via a subscription to an advance subscription agreement ("ASA") under which shares will be issued upon certain qualifying events, including:

a. any issue of ordinary shares for cash by Tribe Tech after 1 March 2023 which raises £4.0 million or more - when shares in Tribe Tech will be issued to Vela under the ASA at 80% of the lowest subscription price paid in such funding round;

b. completion of the acquisition of Tribe Tech by Tribe Tech Holdco and any issue by Tribe Tech Holdco of ordinary shares on Admission raising £1.0 million or more, or any issue unrelated to Admission raising £4.0 million or more - when shares in Tribe Tech Holdco will be issued to Vela under the ASA (adjusted to take into account the basis of acquisition of Tribe Tech) at 80% of the lowest subscription price paid in such funding round;

c. completion of the acquisition of Tribe Tech by Tribe Tech Holdco and confirmation that all conditions relating to Admission have been satisfied (other than Admission) without a fundraising meeting the thresholds in b. above - when shares in Tribe Tech Holdco will be issued to Vela under the ASA (adjusted to take into account the basis of acquisition of Tribe Tech) at a valuation for Tribe Tech Holdco of £12 million; and

d. after nine months from the date of the ASA, whether or not the acquisition of Tribe Tech by Tribe Tech Holdco has occurred - when shares in Tribe Tech or Tribe Tech Holdco (as the case may be) will be issued to Vela under the ASA (adjusted to take into account the basis of acquisition of Tribe Tech if appropriate) at a valuation for Tribe Tech or Tribe Tech Holdco as the case may be of £10.0 million.

James Normand, Executive Director of Vela, commented: "Vela is pleased to have the opportunity to invest in Tribe Tech. The pioneering operating functionality of the equipment developed by Tribe Tech is reflected in the willingness of leading mining companies to fund the manufacture of the first models. Vela's minority investment will help Tribe Tech establish itself as a premier supplier to this major industry sector."

For further information, please contact:

About Vela Technologies

Vela Technologies plc (AIM: VELA) is an investing company focused on early stage and pre-IPO long term disruptive technology investments. Vela's investee companies have either developed ways of utilising technology or are developing technology with a view to disrupting the businesses or sector in which they operate. Vela Technologies will also invest in already-listed companies where valuations offer additional opportunities.