ETQ Energy Tech.

TIDMETQ

RNS Number : 0953A

Energy Technique PLC

18 December 2014

ENERGY TECHNIQUE PLC

("The Company")

NON-BINDING HEADS OF TERMS WITH UNICO INC. FOR

NORTH AMERICA FRANCHISE AGREEMENT

AND

UK MAIN SALES REPRESENTATIVE AGREEMENT

As part of its overseas expansion plans, the Board of Energy Technique plc is pleased to announce that it has reached non-binding heads of terms with Unico Inc. of St Louis, Missouri, USA ("Unico"), to become its first franchisee of Diffusion's fan coils for the North American, Caribbean basin, Bermuda and Canadian markets, on an exclusive basis.

Under the arrangements contemplated, Unico will manufacture Diffusion's fan coils under license from its facility in St Louis, Missouri, USA and it will be responsible for all sales and marketing activities in its franchise markets, delivery of product to end customers and credit management. Diffusion will provide technical input, design and manufacturing instructions and it will receive franchise income based on a percentage of Unico's sales to its end customers. Both parties are working towards concluding a legally binding franchise agreement early in 2015.

Concurrently, non-binding heads of terms have also been reached with Unico for Diffusion to be Unico's main sales representatives in the UK for its small duct high velocity heating and cooling systems. Unico already supplies these systems into the UK and by using Diffusion's established routes to market in the UK, growth in sales of Unico systems are expected to be achieved. Under the arrangements contemplated, Diffusion will market Unico's products in the UK and Republic of Ireland, for installation by third party contractors who will also be responsible for credit management. Diffusion will obtain sales commissions based on the selling value of Unico products installed by third party contractors. Both parties are working towards concluding a legally binding main sales representative agreement early in 2015, at the same time as the franchise agreement with Unico.

For further information:

Walter Goldsmith Chairman 020 8783 0033

Leigh Stimpson CEO 020 8783 0033

Ed Frisby finnCap Limited (Nominated Adviser) 020 7220 0500

NOTES TO EDITORS

About Diffusion

The Company's trading subsidiary, Diffusion, has supplied fan coils and commercial heating products to the UK heating and ventilation industry ("HVAC") for over 50 years. Diffusion is one of the oldest and most established suppliers to the HVAC industry and it is a market leader in the manufacture of premium quality fan coils and commercial heating products. The Diffusion and Energy Technique brand names are recognised as highly engineered, quality products providing leading edge performance and energy efficiency.

Diffusion's products are installed into commercial offices, hotels, airports, retail outlets, schools, and more recently high-end residential developments. Fan coils are supplied into developments of the major property owning companies, including Land Securities, Stanhope Properties, Grosvenor Estates and British Land. Commercial heating end users include Marks & Spencer, Sainsbury's, Tesco, New Look, Boots, ASDA, John Lewis, Fat Face, Lloyds Bank and TK Maxx. All products are designed, developed and manufactured to customers' bespoke requirements from Diffusion's 30,000 sq. ft. manufacturing facility in West Molesey, Surrey.

About Unico

Unico commenced trading in 1985 and its annual sales have now grown to $26 million. Unico employs 82 full time employees from its two manufacturing facilities in St Louis, Missouri, USA having over 200,000 sq. ft. of manufacturing and storage space, together with distribution and sales in North America, Europe, Africa, Central and South America, India, and China. Unico is now considered to be a leader in Small Duct High Velocity ("SDHV") heating and cooling systems, which have been approved since 2004 as a separate class of product with the US Department of Energy.

This information is provided by RNS

The company news service from the London Stock Exchange

END

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