TIDMFDBK
RNS Number : 1110F
Feedback PLC
25 October 2018
THIS ANNOUNCEMENT IS NOT FOR PUBLICATION, RELEASE OR
DISTRIBUTION, DIRECTLY OR INDIRECTLY, IN WHOLE OR IN PART, IN OR
INTO OR FROM THE UNITED STATES, AUSTRALIA, NEW ZEALAND, CANADA, THE
REPUBLIC OF SOUTH AFRICA OR JAPAN OR ANY OTHER JURISDICTION IN
WHICH SUCH PUBLICATION, RELEASE OR DISTRIBUTION WOULD BE
UNLAWFUL.
The information contained within this announcement is deemed by
the Company to constitute inside information as stipulated under
the Market Abuse Regulations (EU) No. 596/2014. Upon the
publication of this announcement via Regulatory Information
Service, this inside information is now considered to be in the
public domain
25 October 2018
Feedback plc
Proposed placing and subscription to raise GBP1.375 million
Cambridge, 25 October 2018: Feedback plc (AIM: FDBK, "Feedback"
or the "Company"), the specialist medical imaging technology
company, announces that it has conditionally raised a total of
GBP1.375 million (before expenses) via a proposed placing, by
Peterhouse Capital Limited, and subscription of a total of
91,666,666 new ordinary shares ("New Ordinary Shares"), at an issue
price of 1.5 pence per New Ordinary Share (the "Issue Price").
Approximately GBP832,000 (before expenses) has been raised
pursuant to the Company's existing share authorities (the
"Placing"), and a further GBP543,000 has been raised subject to,
inter alia, the approval of Shareholders at a General Meeting of
the Company (the "Subscription").
Further information on the Company, current trading and its
strategy is set out below and in the shareholder circular which is
expected to be posted to shareholders on or around 29 October 2018
(the "Circular").
Placing Highlights:
-- The Company has conditionally raised GBP1.375 million (before
expenses) through the issue of the 91,666,666 New Ordinary Shares,
55,466,666 of which are expected to be admitted to trading on AIM
on 31 October 2018
-- Certain of the directors of the Company have subscribed for
6,933,333 New Ordinary Shares (in aggregate) pursuant to the
Subscription, representing GBP104,000 (in aggregate) at the Issue
Price
-- The Placing Price represents a discount of approximately
11.8% to the closing mid-market price of 1.7 pence per Ordinary
Share on 24 October 2018
-- The Subscription is subject to shareholder approval at a
General Meeting of the Company on 15 November 2018. If approved,
the New Ordinary Shares issued pursuant to the Subscription are
expected to be admitted to trading on AIM on 16 November 2018
-- The New Ordinary Shares will represent 24.56% of the enlarged
issued share capital of the Company
Use of Proceeds:
-- Expansion of the Company's sales and marketing services
-- Development of technical product support for the new Cadran
product offerings and to expand the Cadran customer base
-- To fund regulatory consultant commission costs in relation to
the Company's plans to secure regulatory approval of TexRAD(R) with
the US FDA, including 510k as a medical device and CFR Chapter 21
part 11 compliance for use in clinical trials of drug candidates
for FDA marketing approval
-- To develop the Company's partnership with Imaging Endpoints,
its US imaging company partner, in order to maximise its sales in
the US
-- To facilitate new staff appointments
Dr Alastair Riddell, Executive Chairman of Feedback said:
"We are pleased to have received support from existing and new
investors. This is a strong endorsement of Feedback and our
strategy at a time of general market uncertainty."
"This placing will enable Feedback to continue to invest in the
further growth of the business. In particular, in the fields of
image analysis with TexRAD(R) , and AI applications in linking
image data to anonymised patient data with Cadran. In addition,
beginning the process of seeking US FDA approval for TexRAD(R) can
now be properly resourced. Expanding our sales, marketing and
customer support capabilities, will ensure that we can build on the
significant momentum generated this year."
Notice of General Meeting and Shareholder Circular
The Subscription is conditional, inter alia, on the approval of
shareholders of resolutions to be proposed at a general meeting of
the Company to provide authority to the Directors to allot further
new ordinary shares otherwise than on a pre-emptive basis.
A General Meeting of the Company will be held at the offices of
Peterhouse Capital Limited, New Liverpool House, 15 Eldon St,
London EC2M 7LD at 10.00 a.m. on 15 November 2018, to seek this
shareholder approval. A Circular containing a Notice of General
Meeting will be posted to shareholders on or around 29 October 2018
and will be available on the Company's website, www.fbkmed.com,
shortly thereafter.
Further information
The above summary should be read in conjunction with the full
text of this announcement.
Enquiries:
Feedback plc +44 (0)1954 718072
Alastair Riddell, Executive Chairman IR@fbk.com
Lindsay Melvin, CFO
Allenby Capital Limited (Nominated Adviser)
David Worlidge / Asha Chotai +44 (0)20 3328 5656
Peterhouse Capital Limited (Joint Broker)
Lucy Williams / Duncan Vasey +44 (0)20 7469 0936
Stanford Capital Partners Limited (Joint +44 20 3815 8880
Broker)
Patrick Claridge / John Howes +44 (0)20 7457 2020
feedbackplc@instinctif.com
Instinctif Partners
Rozi Morris/ Deborah Bell/ Phillip Marriage
LETTER FROM THE CHAIRMAN OF FEEDBACK PLC
1. Introduction
The Company is pleased to announce that it has conditionally
raised GBP1.375 million (before expenses) by way of the proposed
Placing and Subscription of a total of 91,666,666 Placing and
Subscription Shares in two tranches. All Placing and Subscription
Shares will be issued at the Issue Price of 1.5 pence per new
Ordinary Share.
The Company has raised GBP832,000 (before expenses) pursuant to
the Company's existing share authorities and a further GBP543,000
has been raised subject to, inter alia, the approval of
Shareholders at the General Meeting.
The Placing Shares are to be admitted to trading on AIM via
First Admission. First Admission is expected to take place at 8:00
a.m. on 31 October 2018. The Subscription Shares are expected to be
admitted to trading on AIM via Second Admission. Second Admission
is expected to take place at 8:00 a.m. on 16 November 2018, should
the Resolutions to be proposed at the General Meeting, further
details of which can be found below, be passed at the General
Meeting.
Dr Alastair Riddell, Executive Chairman of the Company, has
conditionally subscribed for 1,000,000 Subscription Shares
(representing GBP15,000 at the Issue Price). Lindsay Melvin, Chief
Financial Officer of the Company, has conditionally subscribed for
600,000 Subscription Shares (representing GBP9,000 at the Issue
Price). Simon Sturge, Non-Executive Director of the Company has
conditionally subscribed for 5,333,333 Subscription Shares
(representing approximately GBP80,000 at the Issue Price).
2. Use of Proceeds
Feedback is seeing considerable sales growth potential in the
near to mid-term, from line extensions in its current product range
and increased sales from its distributors. As such, the Company
intends to use the net proceeds of the Placing and Subscription to
expand its sales and marketing services. In addition, funds will be
used to develop technical product support for the new Cadran
product offerings and to expand the Cadran customer base.
In order to enable it to also address the potential in the US
market for the mid to long term, the Company has initiated plans
for regulatory approval of TexRAD(R) with the US FDA including 510k
as a medical device and CFR Chapter 21 part 11 compliance for use
in clinical trials of drug candidates for FDA marketing approval.
The net proceeds of the Placing and Subscription will be used, in
part, to fund regulatory consultant commission costs in respect of
the regulatory approvals.
The Company also intends to use the net proceeds of the Placing
and Subscription to develop its partnership with Imaging Endpoints,
its US imaging company partner. The Company believes that
development of this partnership will result in maximising its sales
in the US.
As previously announced, Feedback's strategic business plan is
focused on capitalising on the considerable investments made to
date and it has identified additional staffing required to deliver
future major growth. A portion of the proceeds of the Placing and
Subscription will be used to facilitate two to three new staff
appointments in support of each of its products and to support US
regulatory approvals. .
3. Current Trading and Prospects
As announced on 3 October 2018, in the year to 31 May 2018,
Feedback invoiced sales of GBP771k, a 51% increase on the previous
year (FY 2017: GBP508k), leading to recognised revenue in the year
of GBP458k (FY 2017: GBP466k). This 51% increase in invoiced sales
is a result of the Company's investment in its employees with
training and recruitment of four new hires. The associated
recruitment, restructuring and other costs have meant that the
Company's operating loss has risen to GBP750k (FY 2017: GBP300k).
However, the investment has led to significant improvement in sales
performance and anticipated long term growth.
This improved sales performance has continued into the first
quarter of the current financial year, with a 100% increase in
invoiced sales of both TexRAD(R) and Cadran product licences in the
first quarter to GBP236k, compared to GBP117k in the first quarter
of FY 2018. International sales accounted for most of this growth,
increasing by over 200%. Importantly, this has been achieved with
improved cost control in this financial year. Feedback's prudent
accounting policy is to spread the income from its software licence
and support sales over the duration of the contract, usually one to
two years. The Company's balance sheet contains a deferred revenue
asset to reflect this.
The Company intends to release its Annual Report and Accounts
for the year ended 31 May 2018 prior to 30 November 2018.
4. Details of the Placing and Admission
A total of GBP832,000 (before expenses), representing the issue
of 55,466,666 new Ordinary Shares at the Issue Price, has been
raised by way of the Placing utilising the Company's existing share
authorities put in place at the Company's general meeting held on
22 June 2018. The Placing is conditional, inter alia, upon the
Placing Agreement becoming unconditional in all respects and not
having being terminated in accordance with its terms; and admission
of the Placing Shares to trading on AIM.
The Company is also proposing to raise GBP543,000 (before
expenses) by way of the Subscription at the Issue Price. The
Subscription is conditional, inter alia, upon the passing of the
Resolutions without amendment at the General Meeting.
The Placing and Subscription will result in the issue of a total
of 91,666,666 New Ordinary Shares, representing, in aggregate,
approximately 24.56% of the Enlarged Share Capital. Such new
Ordinary Shares, when issued and fully paid, will rank pari passu
in all respects with the Existing Ordinary Shares and therefore
will rank equally for all dividends or other distributions
declared, made or paid after the relevant date of Admission.
Application has been made to the London Stock Exchange for the
Placing Shares to be admitted to trading on AIM and admission of
the Placing Shares is expected to occur on 31 October 2018.
It is expected that CREST accounts will be credited on the day
of First Admission as regards the Placing Shares in uncertificated
form and that certificates for those shares to be issued in
certificated form will be dispatched by first class post by 14
November 2018.
Application will also be made to the London Stock Exchange for
the Subscription Shares to be admitted to trading on AIM and,
conditional inter alia on the approval of Shareholders at the
General Meeting, admission of the Subscription Shares is expected
to occur on 16 November 2018.
It is expected that CREST accounts will be credited on the day
of Second Admission as regards the Subscription Shares in
uncertificated form and that certificates for those shares to be
issued in certificated form will be dispatched by first class post
by 30 November 2018.
5. Related Party Transactions
Dr Alastair Riddell, Executive Chairman of the Company, has
conditionally subscribed for 1,000,000 Subscription Shares
(representing GBP15,000 at the Issue Price). Lindsay Melvin, Chief
Financial Officer of the Company, has conditionally subscripted for
600,000 Subscription Shares (representing GBP9,000 at the Issue
Price). Simon Sturge, a Non-Executive Director of the Company has
conditionally subscribed for 5,333,333 Subscription Shares
(representing approximately GBP80,000 at the Issue Price). The
directors' participation in the Subscription constitutes a related
party transaction under rule 13 of the AIM Rules.
Tom Charlton, a substantial shareholder of the Company, having
an interest in approximately 24.09% of the voting rights of the
Company, has subscribed for 14,000,000 Subscription Shares
(representing GBP210,000 at the Issue Price). Tom Charlton's
participation in the Subscription constitutes a related party
transaction under rule 13 of the AIM Rules.
Timothy Irish, the Independent Director, having consulted with
the Company's nominated adviser Allenby Capital, considers that the
terms of the participation of Dr Alastair Riddell, Lindsay Melvin,
Simon Sturge and Tom Charlton in the Subscription to be are fair
and reasonable insofar as the Shareholders are concerned.
6. General Meeting
A notice convening the General Meeting will be included in the
Circular. The General Meeting of the Company is to be held at the
offices of Peterhouse Capital Limited at New Liverpool House, 15
Eldon St, London EC2M 7LD at 10:00 a.m. on 15 November 2018.
At the General Meeting, Shareholders will consider the following
resolutions:
a. an ordinary resolution to grant the Directors authority to allot the Subscription Shares; and
b. a special resolution to disapply Shareholders' statutory
pre-emption rights which would otherwise apply to the allotment of
the Subscription Shares.
7. Directors' Recommendation
The Directors consider the Placing and Subscription, and the
Resolutions to be in the best interests of the Company and its
Shareholders as a whole and unanimously recommend that Shareholders
vote in favour of the Resolutions to be proposed at the General
Meeting as they intend to do in respect of their own beneficial
holdings which amount to, in aggregate, 13,500,000] Ordinary
Shares, representing approximately 4.79% of the Existing Ordinary
Shares.
8. Total Voting Rights
Upon First Admission, the Company's issued ordinary share
capital will consist of 337,083,251 Ordinary Shares with one voting
right each. The Company does not hold any ordinary shares in
treasury. Therefore, the total number of ordinary shares and voting
rights in the Company will be 337,083,251. With effect from First
Admission, this figure may 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 to their interest in, the share capital of the Company under
the FCA's Disclosure Guidance and Transparency Rules.
Upon Second Admission, the Company's issued share capital will
consist of 373,283,251 Ordinary Shares with one voting right each.
The Company does not hold any ordinary shares in treasury.
Therefore, the total number of ordinary shares and voting rights in
the Company will be 373,283,251. With effect from Second Admission,
this figure may 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 to their
interest in, the share capital of the Company under the FCA's
Disclosure Guidance and Transparency Rules.
EXPECTED TIMETABLE OF PRINCIPAL EVENTS
2018
Circular and Form of Proxy expected 29 October
to be posted to Shareholders
Admission and commencement of dealings 31 October
in the Placing Shares to trading on
AIM
CREST member accounts expected to be 31 October
credited for the Placing Shares in uncertificated
form (where applicable)
Dispatch of definitive share certificates 14 November
for the Placing Shares in certificated
form (where applicable)
Latest time and date for receipt of 10.00 a.m. 13 November
Form of Proxy
General Meeting 10.00 a.m. on 15 November
Admission and commencement of dealings 16 November
in the Subscription Shares to trading
on AIM
CREST member accounts expected to be 16 November
credited for the Subscription Shares
in uncertificated form (where applicable)
Dispatch of definitive share certificates 30 November
for the Subscription Shares in certificated
form (where applicable)
Notes:
(1) Certain of the dates in the above timetable are subject to
change at the discretion of Allenby Capital, Peterhouse, Stanford
Capital Partners and the Company.
(2) References to time in this Circular are to London time
except when otherwise stated.
(3) If any of the above times and/or dates change, the revised
time(s) and/or date(s) will be notified to Shareholders by
announcement through a Regulatory Information Service.
PLACING STATISTICS
Issue Price 1.5 pence
Number of Existing Ordinary Shares in issue
as at the date of this announcement 281,616,584
Total number of Placing Shares 55,466,666
Total shares in issue at First Admission 337,083,251
Total number of Subscription Shares 36,200,000
Total shares in issue at Second Admission 373,283,251
Percentage of the Enlarged Share Capital
represented by the New Ordinary Shares 24.56%
Gross proceeds of the Placing and Subscription GBP1.375 million
Estimated net proceeds of the Placing and GBP1.3 million
Subscription
ISIN GB0003340550
SEDOL 0334055
LEI 213800UGOF2GT2U2RV90
IMPORTANT NOTICE
No action has been taken by the Company, Allenby Capital,
Peterhouse or Stanford Capital Partners or any of their respective
affiliates, that would, or which is intended to, permit a public
offer of the Placing Shares or Subscription Shares in any
jurisdiction or the possession or distribution of this announcement
or any other offering or publicity material relating to the Placing
Shares or Subscription Shares in any jurisdiction where action for
that purpose is required. Any failure to comply with these
restrictions may constitute a violation of the securities laws of
such jurisdictions. Persons into whose possession this announcement
comes shall inform themselves about, and observe such
restrictions.
No prospectus will be made available in connection with the
matters contained in this announcement and no such prospectus is
required (in accordance with the Prospectus Directive) to be
published.
THIS ANNOUNCEMENT IS FOR INFORMATION PURPOSES ONLY, IS NOT INTED
TO AND DOES NOT CONSTITUTE OR FORM PART OF ANY OFFER OR INVITATION
TO PURCHASE OR SUBSCRIBE FOR, UNDERWRITE, SELL OR ISSUE OR THE
SOLICITATION OF AN OFFER TO PURCHASE OR SUBSCRIBE, SELL, ACQUIRE,
DISPOSE OF THE PLACING SHARES OR SUBSCRIPTION SHARES OR ANY OTHER
SECURITY IN THE UNITED STATES, AUSTRALIA, NEW ZEALAND, CANADA,
JAPAN OR THE REPUBLIC OF SOUTH AFRICA OR IN ANY JURISDICTION IN
WHICH, OR TO ANY PERSONS TO WHOM, SUCH OFFERING, SOLICITATION OR
SALE WOULD BE UNLAWFUL.
No representation or warranty, express or implied, is or will be
made as to, or in relation to, and no responsibility or liability
is or will be accepted by the Company, Allenby Capital, Peterhouse
or Stanford Capital Partners or any of their respective affiliates
or any of their respective directors, officers, employees, advisers
or representatives (collectively, "Representatives") as to or in
relation to the accuracy or completeness of this announcement or
any other written or oral information made available to or publicly
available to any interested party or its advisers, and any
liability therefor is expressly disclaimed.
This announcement does not identify or suggest, or purport to
identify or suggest, the risks (direct or indirect) that may be
associated with an investment in the Placing Shares or Subscription
Shares. Any investment decision to buy Placing Shares or
Subscription Shares in the Placing must be made solely on the basis
of publicly available information, which has not been independently
verified by Allenby Capital, Peterhouse or Stanford Capital
Partners.
This announcement contains certain forward-looking statements,
beliefs or opinions, with respect to certain of the Company's
current expectations and projections about future prospects,
developments, strategies, performance, anticipated events or trends
and other matters that are not historical facts. These
forward-looking statements, which sometimes use words such as
"aim", "anticipate", "believe", "intend", "plan", "estimate",
"expect" and words of similar meaning, include all matters that are
not historical facts and reflect the directors' beliefs and
expectations and involve a number of risks, uncertainties and
assumptions that could cause actual results and performance to
differ materially from any expected future results or performance
expressed or implied by the forward-looking statement. Statements
contained in this announcement regarding past trends or activities
should not be taken as a representation that such trends or
activities will continue in the future. The information contained
in this announcement is subject to change without notice and,
except as required by applicable law, neither the Company, Allenby
Capital, Peterhouse nor Stanford Capital Partners nor any of their
respective affiliates nor any of their respective Representatives
assumes any responsibility or obligation to update, amend or revise
publicly or review any of the forward-looking statements contained
in this announcement. You should not place undue reliance on
forward-looking statements, which speak only as of the date of this
announcement. Any indication in this announcement of the price at
which Placing Shares or Subscription Shares have been bought or
sold in the past cannot be relied upon as a guide to future
performance. No statement in this announcement is or is intended to
be a profit forecast or profit estimate or to imply that the
earnings of the Company for the current or future financial years
will necessarily match or exceed the historical or published
earnings of the Company. Past performance of the Company cannot be
relied on as a guide to future performance and persons reading this
announcement are cautioned not to place undue reliance on such
forward-looking statements.
The price of Ordinary Shares and any income from them may go
down as well as up and investors may not get back the full amount
invested on disposal of the Ordinary Shares.
The Placing Shares and Subscription Shares to be issued pursuant
to the Placing will not be admitted to trading on any stock
exchange other than the AIM Market operated by the London Stock
Exchange.
Neither the content of the Company's website nor any website
accessible by hyperlinks on the Company's website is incorporated
in, or forms part of, this announcement.
DEFINITIONS
Admission First Admission and Second Admission.
AIM AIM, a market operated by the London
Stock Exchange.
AIM Rules the AIM Rules for Companies, as published
and amended from time to time by the
London Stock Exchange.
Allenby Capital Allenby Capital Limited, the Company's
nominated adviser pursuant to the AIM
Rules.
Articles the existing articles of association
of the Company as at the date of this
Circular.
Circular the circular to be sent to Shareholders
on or around 29 October 2018
Company or Feedback Feedback Group plc.
CREST the computerised settlement system (as
defined in the CREST Regulations) which
facilitates the transfer of title to
shares in uncertificated form.
CREST Manual the manual, as amended from time to
time, produced by Euroclear UK & Ireland
which facilitates the transfer of shares
in uncertificated form.
CREST member a person who has been admitted by Euroclear
UK and Ireland as a system-member (as
defined in the CREST Regulations).
CREST Regulations the Uncertificated Securities Regulations
2001 (SI 2001/3755) (as amended);
Directors or Board the directors of the Company.
Enlarged Share Capital the 373,283,251 Ordinary Shares in issue
immediately following Second Admission.
Euroclear UK & Ireland Euroclear UK & Ireland Limited, the
operator of CREST.
Existing Ordinary Shares the 281,616,584 existing Ordinary Shares
in issue in the capital of the Company
as at the date of this announcement.
First Admission the admission of the Placing Shares
to trading on AIM becoming effective
in accordance with the AIM Rules.
Form of Proxy the form of proxy for use in connection
with the General Meeting.
General Meeting or GM the general meeting of Shareholders
to be held at the offices of Peterhouse
Capital Limited at New Liverpool House,
15 Eldon St, London EC2M 7LD at 10:00
a.m. on 15 November 2018.
HMRC HM Revenue & Customs.
Independent Director Tim Irish, being the Director who is
not participating in the Placing or
Subscription.
ISIN International Securities Identification
Number.
Issue Price 1.5 pence per New Ordinary Share.
London Stock Exchange London Stock Exchange plc.
New Ordinary Shares together the Placing Shares and the
Subscription Shares.
Notice of General Meeting the notice of General Meeting set out
in the Circular.
Optionholders the holders of options to acquire Ordinary
Shares, offered or granted in accordance
with the share option scheme operated
by the Company.
Ordinary Shares the ordinary shares of 0.25 pence per
share in the capital of the Company.
Peterhouse Peterhouse Corporate Finance Limited,
the Company's joint broker, pursuant
to the AIM Rules.
Placees the persons who have conditionally agreed
to subscribe for the Placing Shares.
Placing the placing of the Placing Shares at
the Issue Price, as described in this
Circular.
Placing Agreement the conditional agreement dated 24 October
2018 between: (1) the Company; (2) Peterhouse;
and (3) the Directors relating to the
Placing.
Placing Shares the 55,466,666 new Ordinary Shares,
which have been placed with institutional
and other investors.
Resolutions the resolutions to be proposed at the
General Meeting as set out in the Notice
of General Meeting.
Second Admission the admission of the Subscription Shares
to trading on AIM becoming effective
in accordance with the AIM Rules.
Shareholder(s) holder(s) of Ordinary Shares.
Stanford Capital Partners Stanford Capital Partners Limited, the
Company's joint broker, pursuant to
the AIM Rules.
Subscription the subscription for the Subscription
Shares at the Issue Price, as described
in this Circular.
Subscription Shares the 36,200,000 new Ordinary Shares,
which have been subscribed by institutional
and other investors.
UK the United Kingdom.
uncertificated or in recorded on the relevant register of
uncertificated form the share or security concerned as being
held in uncertificated form in CREST
and title to which may be transferred
by means of CREST.
Warrantholders the holders of warrants to acquire Ordinary
Shares.
GBP or pence the lawful currency of the UK.
This information is provided by RNS, the news service of the
London Stock Exchange. RNS is approved by the Financial Conduct
Authority to act as a Primary Information Provider in the United
Kingdom. Terms and conditions relating to the use and distribution
of this information may apply. For further information, please
contact rns@lseg.com or visit www.rns.com.
END
IOEFKQDNDBDBNKB
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