Low Carbon Accelerator Limited has announced that it has made a loan of £173,792 to Hemcore Limited (’Hemcore’). The loan is part of a larger debt facility of £999,900 provided by the four largest shareholders in the company, of which an aggregate £553,000 has been drawn down. LCA’s commitment under this facility is £331,800, including the £173,792 already drawn down. The company can draw down funds as required until 30 September 2009. The loan has no fixed date for repayment but will be repaid through a ‘cash sweep’arrangement, after senior debt has been serviced.

In addition, the same shareholders have agreed to provide a debt factoring facility of £400,000 to Hemcore, of which £132,720 will be provided by LCA. The documentation for this second facility is currently being finalized.

These loans are in addition to LCA’s original investment of £1,088,000 in Hemcore. The existing shareholding structure has not changed as a result of this financing round and LCA continues to hold 30.0% of the diluted share capital of Hemcore, with management having an option to 6.5% of the fully diluted shares of Hemcore.

The two loan facilities have been made available for purchasing new equipment for the processing plant. The installation of this plant is proceeding well and is ahead of plan. However, costs have risen from the initial budgeted estimate in part due to re-design of the equipment, and partly due to the rising value of the Euro against Sterling. The facilities will also finance the company’s additional working capital requirements in 2008 and 2009.

Hemcore is the UK’s largest grower and processor of hemp for industrial purposes. Its products are used in the automotive and building industries to provide low-carbon alternatives to glass and synthetic fibres. The company has continued to experience strong demand for its products since LCA’s initial investment and has completed a successful trial with B&Q for its new Breathe insulation product.

About Low Carbon Accelerator: www.lowcarbonaccelerator.com

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