TIDMHAYD
RNS Number : 4028Y
Haydale Graphene Industries PLC
09 September 2020
THIS ANNOUNCEMENT, INCLUDING THE APPIX, AND THE INFORMATION
CONTAINED HEREIN, IS RESTRICTED AND IS NOT FOR RELEASE, PUBLICATION
OR DISTRIBUTION, IN WHOLE OR IN PART, DIRECTLY OR INDIRECTLY, IN,
INTO OR FROM THE UNITED STATES OF AMERICA, CANADA, THE REPUBLIC OF
SOUTH AFRICA, AUSTRALIA, JAPAN OR TO BE TRANSMITTED OR DISTRIBUTED
TO, OR SENT BY, ANY NATIONAL OR RESIDENT OR CITIZEN OF ANY SUCH
COUNTRIES OR ANY OTHER JURISDICTION IN WHICH SUCH RELEASE,
PUBLICATION OR DISTRIBUTION MAY CONTRAVENE LOCAL SECURITIES LAWS OR
REGULATIONS. PLEASE SEE THE IMPORTANT NOTICE IN THE APPIX TO THIS
ANNOUNCEMENT.
THIS ANNOUNCEMENT, INCLUDING THE APPIX, IS FOR INFORMATION
PURPOSES ONLY AND DOES NOT CONSTITUTE OR CONTAIN ANY INVITATION,
SOLICITATION, RECOMMATION, OFFER OR ADVICE TO ANY PERSON TO
SUBSCRIBE FOR, OTHERWISE ACQUIRE OR DISPOSE OF ANY SECURITIES IN
HAYDALE GRAPHENE INDUSTRIES PLC OR ANY OTHER ENTITY IN ANY
JURISDICTION WHERE TO DO SO WOULD BREACH ANY APPLICABLE LAW OR
REGULATION. NEITHER THIS ANNOUNCEMENT NOR THE FACT OF ITS
DISTRIBUTION SHALL FORM THE BASIS OF, OR BE RELIED ON IN CONNECTION
WITH, ANY INVESTMENT DECISION IN RESPECT OF HAYDALE GRAPHENE
INDUSTRIES PLC.
THIS ANNOUNCEMENT SHOULD BE READ IN ITS ENTIRETY. IN PARTICULAR,
YOU SHOULD READ AND UNDERSTAND THE INFORMATION PROVIDED IN THE
APPIX WHICH CONTAINS THE TERMS AND CONDITIONS OF THE PLACING.
THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION FOR THE PURPOSES
OF THE MARKET ABUSE REGULATION (596/2014/EU) ("MAR"). IN ADDITION,
MARKET SOUNDINGS (AS DEFINED IN MAR) WERE TAKEN IN RESPECT OF
CERTAIN OF THE MATTERS CONTAINED IN THIS ANNOUNCEMENT, WITH THE
RESULT THAT CERTAIN PERSONS BECAME AWARE OF SUCH INSIDE
INFORMATION, AS PERMITTED BY MAR. UPON THE PUBLICATION OF THIS
ANNOUNCEMENT, THIS INSIDE INFORMATION IS NOW CONSIDERED TO BE IN
THE PUBLIC DOMAIN AND SUCH PERSONS SHALL THEREFORE CEASE TO BE IN
POSSESSION OF INSIDE INFORMATION.
9 September 2020
HAYDALE GRAPHENE INDUSTRIES PLC
("Haydale", the "Company" or the "Group")
Proposed placing by way of an accelerated bookbuild
("Placing")
Subscriptions by certain Directors and others
("Subscription")
to raise approximately GBP3.0 million (the Placing, and
Subscription together the "Fundraising")
and
Announcement of Contract Win
Haydale, the global technologies group and service provider that
facilitates the integration of graphene and other nanomaterials
into the next generation of industrial materials and commercial
technologies, today announces its intention to conduct a placing of
68,428,526 new Ordinary Shares ("Placing Shares") and Subscription
of 16,571,424 new Ordinary Shares ("Subscription Shares") at a
price of 3.5 pence per share (being the "Issue Price") with new and
existing shareholders.
The funds raised by the Placing will be used predominantly as
working capital to finance the operations of the Company.
The Placing will be conducted through an accelerated book
building process (the "Bookbuilding Process") which will be
launched immediately following this announcement. The Placing is
subject to the terms and conditions set out in the appendix to this
announcement (the "Appendix") (the Appendix forms part of this
announcement, such announcement and its Appendix together being
this "Announcement").
Reason for the Placing
In March 2019, Haydale raised a net GBP5.6 million through an
equity fund raising to fund general working capital, restructuring
costs and investment with a focus on the delivery of short-term
commercial targets. Following that fundraising, Keith Broadbent was
appointed as Chief Executive Officer of the Company to deliver this
strategy.
Over the last 18 months Haydale has made significant progress in
moving from a research and development focused organisation to one
that the Directors believe is on the threshold of making an impact
on the diverse markets and industries that the Company's technology
can positively impact. The Directors believe that they have
delivered on their mandate from the 2019 fund raise as follows:
Focused investment in R&D
Haydale brings together two state of the art technologies - a
patented plasma functionalisation process and an understanding of
graphene and other nano materials (together "Graphene"). Over the
past 18 months the Group has invested in both the degree of
functionalisation and its capacity to scale production to
commercial volumes.
-- Haydale has developed a globally patented process to
functionalise Graphene to allow it to interact with the targeted
host and to enhance the electrical, thermal or mechanical
properties of the end material. The level of enhancement depends on
the level of surface functionalisation and Haydale continues to
invest in advancing that process. Some recent developments
include:
o Increase in surface oxygen levels up to 28%, a level which
allows Haydale potential access to the graphene oxide market and
indirectly elements of the electronics sector;
o Development of next generation functionalised inks with
resistivity reduced to 10 ohms which allows for the replacement of
silver and copper in certain elements of the growing RFID and NFC
sectors. A cost effective and environmentally friendly
application;
o Development of inks to surface coat fabrics and other garment
material to create anti-microbial and anti-bacterial applications;
and
o Graphene enhanced resins and polymers which can protect
commercial aircraft, from lightning strike damage. Use of graphene
enhance materials could make the copper 'Faraday' cage redundant
and reduce the unloaded weight of the plane.
-- Haydale has concentrated on technologies where it can
demonstrate and sustain a technological advantage and where it can
see a clear commercial pathway. To take advantage of that
opportunity Haydale needs to be able to produce industrial volumes
cost effectively. In the last 18 months Haydale has significantly
increased its production capacity whilst improving the consistency
of that output. The new contract win announced below requires
Haydale to manufacture a significant volume of functionalised
Graphene and this level of output is now possible.
Group Restructuring and Cost Reductions
Haydale had expanded quickly in APAC through 2015-17 but had
failed to fulfil its potential within the region. As announced in
January 2020, Haydale took the decision to close its loss-making
Taiwan facility and repatriated this operation to its ink
development hubs in Ammanford and Bangkok. Haydale recently signed
a commission agreement with U-Win, a specialist materials and
technology focused sales organisation, who have a mandate to sell
Haydale's specialist inks and composites into the biomedical sensor
and automotive and sports equipment manufacturers. The Directors
are pleased with the early progress of this arrangement. Within the
wider APAC region, Haydale has established a memorandum of
understanding with a Sino-UK facilitator for business development
purposes in China. Whilst it is still early days, we are seeing
encouraging interest in the region for our PATit
anti-counterfeiting product and in the silicon carbide ("SiC")
manufactured by Haydale's US division.
In UK operations, it was imperative that Haydale improved its
productivity, reduced its costs, and realigned its team to focus on
sales and market development. Over the past 18 months the Directors
have:
-- Reduced the headcount by a third from 75 to 50, and
specifically reduced the level of senior managers within the
business units. Despite this overall reduction, Haydale has
invested in expanding its global sales resource to ensure that it
has the capacity to deliver on its commercial strategy;
-- Closed a loss-making facility; and
-- Realised significant savings across the wider business and
the Directors expect to make further cost savings in the current
financial year ending 30 June 2021.
Focus on Short Term Commercial Goals
The Directors have realigned the organization to focus on both
the immediate commercial prospects and the longer-term potential of
sales opportunity. This business pipeline is collated and analysed
within the global sales tracker which assists in the allocation of
sales, marketing, production, technical, and financial resource to
enable a profitable outcome. Some key opportunities resulting from
this systematic process are:
-- Working with a UK based global RFID manufacturer to replace
silver within a range of RFID tags in some applications;
-- A four-year contract with Uniqe Aviation for the supply of
electrically enhanced masterbatch in the Chinese civil aviation
sector
-- As detailed below, a three-year contract for sale of GNP-02
for the production of cosmetic face sheets. Haydale is currently
negotiating a contract to sell the separate graphene enhanced PPE
masks in the European market;
-- Planned field trial of CeramycShield(TM), a cost-effective
treatment that restores and renews cracked and old concrete, with a
UK water utility company;
-- Discussing sales and licensing of PATit anti-counterfeit
capacitant ink with a number of parties both in Europe and APAC
into sectors as diverse as food and drink, tobacco and
security;
-- At plant trial stage with a multi-national company to lightweight consumer packaging;
-- Working with an automotive manufacturer to replace solvent
based primers with water-based primers.
Haydale is focused on delivering these and other projects to
drive the top line revenue of the Group.
Summary
The Directors have delivered on the strategy set out in March
2019, although that delivery has taken longer than anticipated and
has been impacted by the Covid-19 pandemic. Haydale has used that
crisis to further reassess the focus and direction of the business
and where some markets have diminished, they have moved rapidly to
open and exploit other potential revenue sources. The crisis has
been a catalyst for further change which will lay a strong
foundation for the business as it moves into the next phase of its
evolution.
Contract Win
The Company announced on 4 March 2020 that its graphene had been
incorporated by iCraft into a recently launched cosmetic face mask
sheet. The Directors are pleased to announce that on the 8
September 2020 the Company signed an exclusive agreement with
iCraft. Co. Limited ("iCraft"), a South Korean global technology
company with interests in security and network solutions as well as
the health and beauty sector . Haydale will be the exclusive
supplier of functionalised graphene nano platelets for
incorporation into iCraft's cosmetic face sheet mask range. The
Agreement is for an initial period of three years and with the
following contractual minimum volume drawdown:
Year Volume (kg)
1 1,000
------------
2 2,000
------------
3 3,000
------------
The Directors note that this is the largest volume contract to
date that Haydale has signed for functionalised nano materials and
believes that this demonstrates that Graphene is moving firmly out
of the laboratory and into the commercial sphere.
Trading Update
As indicated in the trading update of 16 April 2020 the Company
has been adversely impacted by Covid-19 especially in the US
division where demand for its SiC blanks has been indirectly
affected by the severely reduced demand for global aviation. Whilst
this has undoubtedly delayed Haydale's progress, the Directors have
acted decisively to reduce the medium-term exposure of this
business unit to the US aviation sector. In particular, the Group
has, amongst other actions:
-- established ties with a large UK engineering tooling supplier
for the distribution of its SiC blanks;
-- contracted with an experienced German agent for the sale of
SiC blanks into parts of the European market and other markets that
are geographically linked to Europe;
-- Successfully completed initial tests of lower grade SiC
blanks from the Asia Pacific region which should allow the Group to
target the larger carbide tooling market;
-- As previously announced, Haydale was appointed the exclusive
UK distributor to the water sector for US based Zirconia Inc for
its CeramycShield(TM) product that renews and restores, old or
decaying concrete. Haydale is working closely with a UK water
utility company and other water facility management companies and
expect to participate in a field trial shortly.
The Directors have taken advantage of national Covid-19 schemes
and have accessed support from the US Cares Act, the UK Bounceback
loan scheme and Coronavirus Job Retention Scheme. The immediate
action to preserve the cash position of the Company that was taken
at the onset of the Covid-19 crisis has enabled the Company to
continue to make progress through the summer of 2020, and to
respond to opportunities that have arisen as our customers have
worked towards their new normal. As at the end of August 2020, all
our UK employees have returned to work albeit some on a part time
basis.
The Group has made a positive start to financial year ending 30
June 2021. However, notwithstanding the progress towards a sound
commercial foundation outlined above, given the wider economic
backdrop, the Directors are taking a prudent approach and only
anticipating a modest recovery for the current year.
Results for the year ended 30 June 2020 ("FY20")
As noted above, the Company has been adversely impacted by
Covid-19 especially in the US division. We advised in April 2020
that it was likely that the overall Group would fall markedly short
of its trading expectations and this has transpired with sales of
SiC blanks being especially affected
Subject to audit, revenue for FY20 is expected to be
approximately GBP2.9 million (2019: GBP3.5 million). Whilst the
Directors are disappointed with this result they are pleased to
report that the Group's gross profit is expected to show a small
improvement (2019 GBP1.90 million) and that gross profit margins
are expected to increase to circa 70% (2019 - 55%). Other operating
income for the year is expected to be materially the same as the
prior year (2019 - GBP0.8 million).
The Group has continued to reduce its cost base during the year
and expects Adjusted Administrative expenses to reduce by circa
GBP0.9 million on a like-for-like basis excluding the impact of
IFRS 16 (2019 - GBP6.9 million). The Directors are pleased to
report that despite the shortfall in revenue, the actions taken to
bolster gross profit and to reduce operating costs both before and
during the Covid-19 lockdown should result in a marked reduction in
the loss from trading in the year (2019 - GBP5.8 million).
Cash as at 30 June 2020 was GBP0.8 million (2019 - GBP4.7
million), with the Group's Operating Cash outflow reduced by
approximately GBP2.0 million (2019 - GBP4.6 million) but this was
offset by a rise of c. GBP1.5 million in working capital in the
year (2019 - GBP0.2 million). The Directors expect this working
capital build up, principally in the US operation, to unwind over
the next 12 - 18 months. The Directors anticipate that the
reduction in working capital and the annualised benefit of the cost
savings achieved will reduce the Net Cash Used in Operations in the
year ended June 2021.
The Directors anticipate that the audited results for the year
ended 30 June 2020 will be announced in October 2020.
Outlook
The Board considers that the long-term outlook remains unchanged
and believe that Haydale's proprietary technology and its capacity
to functionalise nano and other materials and to significantly
enhance the properties of host materials continues to deliver
confidence in the prospects of the Group.
Whilst the business is well placed to benefit from a recovery in
the aviation industry, given the uncertainty surrounding this
sector it believes that it has put in place robust plans to grow
the business whilst reducing reliance on any one particular product
or sector.
The Placing
The Company is proposing to raise approximately GBP3.0 million
(before expenses) pursuant to the Placing and the Subscriptions.
The Placing will be conducted by the Company in accordance with the
terms and conditions set out in the Appendix to this Announcement.
The Placing is being conducted through an accelerated bookbuilding
process (the "Bookbuilding Process") which will commence
immediately following this Announcement.
The Bookbuilding Process will determine final demand for and
participation in the Placing. The Bookbuilding Process is expected
to close not later than 4.30 p.m. (London) today, 9 September 2020,
but may be closed at such earlier or later time as Arden may after
consultation with the Company, in its absolute discretion,
determine. The allocations will be determined at the absolute
discretion of Arden and will be confirmed orally or by email by
Arden following the close of the Bookbuilding Process. A further
announcement will be made following the completion of the
Bookbuilding Process (the "Result of Bookbuild Announcement").
The Appendix (which forms a part of this Announcement) contains
the detailed terms and conditions of the Placing.
The Subscription
Each of the directors of the Company, Anthony Best, Bluebell
Investment & Consulting GmbH (a company controlled by Nicholas
Money-Kyrle) and other(s) have entered into Subscription Agreements
to participate in the Fundraising at the Issue Price. Further
details will be announced in the Result of Bookbuild
Announcement.
Expected timetable: 2020
Announcement of the Fundraising and Bookbuild commences 7.00 a.m. 9 September
Admission and commencement of dealings in the New Shares 8.00 a.m. 15 September
New Shares in uncertificated form expected to be credited to As soon as possible after 8.00 a.m. 15 September
accounts in CREST
Despatch of definitive share certificates for the New Shares in 29 September
certificated form
Each of the times and dates above refer to London time and are
subject to change by the Company. Any such change will be notified
to Shareholders by an announcement on a Regulatory Information
Service.
Further information on the Fundraising and Admission is included
in the section headed 'Additional Information' below. Attention is
also drawn to the section headed 'Important Information' of this
Announcement and the terms and conditions of the Placing
(representing important information for Placees only) in the
Appendix to this Announcement.
Capitalised terms used but not defined in this Announcement
shall have the meanings given to such terms in the section headed
'Definitions' below save that any capitalised term defined in the
Appendix shall have such meaning in the Appendix to the exclusion,
in the Appendix only, of any definition of such term elsewhere in
this Announcement.
This Announcement contains inside information for the purposes
of Article 7 of EU Regulation 596/2014 ("MAR"). In addition, market
soundings (as defined in MAR) were taken in connection with the
Fundraising as a result of which certain persons became aware of
inside information (as defined in MAR), as permitted by MAR. This
inside information is set out in this Announcement. Therefore,
those persons that received such inside information in a market
sounding are no longer in possession of such inside information
relating to the Company and its securities.
Further enquiries:
Haydale Graphene Industries plc Tel: 01269 842 946
Keith Broadbent Chief Executive Officer
Arden Partners Tel: 0207 614 5900
Paul Shackleton / Benjamin Cryer Corporate Finance
Fraser Marshall Corporate Broking
IMPORTANT INFORMATION
This Announcement has been issued by, and is the sole
responsibility, of the Company. 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 Arden
or by any of their respective affiliates or agents 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 therefore is expressly disclaimed.
This Announcement is released by Haydale Graphene Industries Plc
and contains inside information for the purposes of Article 7 of
the Market Abuse Regulation (EU) 596/2014 ("MAR"). It is disclosed
in accordance with the Group's obligations under Article 17 of
MAR.
For the purposes of MAR and Article 2 of Commission Implementing
Regulation (EU) 2016/1055, this Announcement is being made on
behalf of the Group by Mark Chapman.
This Announcement does not constitute, or form part of, a
prospectus relating to the Company, nor does it constitute or
contain any invitation or offer to any person, or any public offer,
to subscribe for, purchase or otherwise acquire any shares in the
Company or advise persons to do so in any jurisdiction, nor shall
it, or any part of it form the basis of or be relied on in
connection with any contract or as an inducement to enter into any
contract or commitment with the Company. In particular, the New
Ordinary Shares have not been, and will not be, registered under
the United States Securities Act of 1933 as amended or qualified
for sale under the laws of any state of the United States or under
the applicable laws of any of Canada, Australia, the Republic of
South Africa, Japan, New Zealand or Russia and, subject to certain
exceptions, may not be offered or sold in the United States or to,
or for the account or benefit of, US persons (as such term is
defined in Regulation S under the Securities Act) or to any
national, resident or citizen of Canada, Australia, the Republic of
South Africa, Japan, New Zealand or Russia.
The distribution or transmission of this Announcement and the
offering of the New Ordinary Shares in certain jurisdictions other
than the UK may be restricted or prohibited by law or regulation.
Persons distributing this Announcement must satisfy themselves that
it is lawful to do so. Any failure to comply with these
restrictions may constitute a violation of the securities laws of
any such jurisdiction. No action has been taken by the Company that
would permit an offering of such shares or possession or
distribution of this Announcement or any other offering or
publicity material relating to such shares in any jurisdiction
where action for that purpose is required. Persons into whose
possession this Announcement comes are required by the Company to
inform themselves about, and to observe, such restrictions. In
particular, this Announcement may not be distributed, directly or
indirectly, in or into the United States, Canada, the Republic of
South Africa, Australia, Japan, New Zealand or Russia. Overseas
Shareholders and any person (including, without limitation,
nominees and trustees), who have a contractual or other legal
obligation to forward this Announcement to a jurisdiction outside
the UK should seek appropriate advice before taking any action.
This Announcement includes "forward-looking statements" which
includes all statements other than statements of historical fact,
including, without limitation, those regarding the Company's
financial position, business strategy, plans and objectives of
management for future operations, or any statements preceded by,
followed by or that include the words "targets", "believes",
"expects", "aims", "intends", "will", "may", "anticipates",
"would", "could" or similar expressions or negatives thereof. Such
forward-looking statements involve known and unknown risks,
uncertainties and other important factors beyond the Company's
control that could cause the actual results, performance or
achievements of the Group to be materially different from future
results, performance or achievements expressed or implied by such
forward-looking statements. Such forward-looking statements are
based on numerous assumptions regarding the Company's present and
future business strategies and the environment in which the Company
will operate in the future. These forward-looking statements speak
only as at the date of this Announcement. The Company expressly
disclaims any obligation or undertaking to disseminate any updates
or revisions to any forward-looking statements contained herein to
reflect any change in the Company's expectations with regard
thereto or any change in events, conditions or circumstances on
which any such statements are based unless required to do so by
applicable law or the AIM Rules.
No statement in this Announcement is intended to be a profit
forecast and no statement in this Announcement should be
interpreted to mean that earnings per share of the Company for the
current or future financial years would necessarily match or exceed
the historical published earnings per share of the Company.
Arden Partners plc, which is authorised and regulated by the FCA
in the United Kingdom, is acting as nominated adviser, lead broker
and bookrunner to the Company in connection with the Placing. Arden
Partners plc will not be responsible to any person other than the
Company for providing the protections afforded to clients of Arden
Partners plc or for providing advice to any other person in
connection with the Placing or any acquisition of shares in the
Company. Arden Partners plc is not making any representation or
warranty, express or implied, as to the contents of this
Announcement. Arden Partners plc has not authorised the contents
of, or any part of, this Announcement, and no liability whatsoever
is accepted by Arden Partners plc for the accuracy of any
information or opinions contained in this Announcement or for the
omission of any material information.
The New Ordinary Shares will not be admitted to trading on any
stock exchange other than the AIM market of the London Stock
Exchange.
The Appendix to this Announcement (which forms part of this
Announcement) sets out the terms and conditions of the Placing. By
participating in the Placing, each person who is invited to and who
chooses to participate in the Placing by making or accepting an
oral and legally binding offer to acquire Placing Shares will be
deemed to have read and understood this Announcement in its
entirety (including the Appendix) and to be making such offer on
the terms and subject to the conditions set out in this
Announcement and to be providing the representations, warranties,
undertakings and acknowledgements contained in the Appendix.
Neither the content of the Company's website (or any other
website) nor the content of any website accessible from hyperlinks
on the Company's website (or any other website) is incorporated
into, or forms part of, this Announcement.
DEFINITIONS
The following definitions apply throughout this Announcement
unless the context otherwise requires:
"Act" the Companies Act 2006, as amended
"Admission" the admission of the New Ordinary Shares to trading on AIM
becoming effective in accordance
with the AIM Rules
"AIM" the market of that name operated by the London Stock Exchange
"AIM Rules" the AIM Rules for Companies governing the admission to and
operation of AIM published by the
London Stock Exchange as amended from time to time
"Announcement" this announcement, including the Appendix
"Arden" Arden Partners plc, the Company's nominated adviser and broker
"Articles" the articles of association of the Company in force at the date
of this Announcement
"Board" or "the Directors" the directors of the Company or any duly authorised committee
thereof
"certificated" or "in certificated form" in relation to a share or other security, a share or other
security that is not in uncertificated
form, that is not in CREST
"City Code" the City Code on Takeovers and Mergers
"Closing Price" the closing middle market quotation of a share as derived from
the AIM Appendix to the Daily
Official List of the London Stock Exchange
"Company" or "Haydale" Haydale Graphene Industries Plc a company incorporated in
England and Wales with company number
7228939 whose registered office is at Clos Fferws, Parc Hendre,
Capel Hendre, Ammanford, Carmarthenshire,
SA18 3BL
"CREST" the relevant system (as defined in the CREST Regulations 2001)
for the paperless settlement
of trades and the holding of uncertificated securities,
operated by Euroclear, in accordance
with the same regulations
"CREST Regulations" the Uncertificated Securities Regulations 2001 (SI 2001 No.
3875), as amended
"Enlarged Share Capital" the issued Ordinary Share capital of the Company immediately
following the issue of the New
Ordinary Shares
"Euroclear" Euroclear UK & Ireland Limited, the operator of CREST
"Existing Ordinary Shares" the Ordinary Shares in issue as at the date of this
Announcement being the entire issued share
capital of the Company prior to the Fundraising
"FCA" the Financial Conduct Authority of the UK
"FSMA" the Financial Services and Markets Act 2000 (as amended)
"Fundraising" together, the Placing, and the Subscriptions
"Group" together the Company and its subsidiary undertakings
"ISIN" International Securities Identification Number
"Issue Price" 3.5 pence
"London Stock Exchange" London Stock Exchange plc
"member account ID" the identification code or number attached to any member
account in CREST
"New Shares" or "New Ordinary Shares" together, the Placing Shares and the Subscription Shares
"Ordinary Shares" ordinary shares of 2 pence each in the capital of the Company
having the rights and being
subject to the restrictions contained in the Articles
"Overseas Shareholders" Shareholders with registered addresses, or who are citizens or
residents of, or incorporated
in, countries outside of the United Kingdom
"Placees" persons who agree to subscribe for Placing Shares under the
Placing
"Placing" the placing by Arden, as agent of and on behalf of the Company,
of the Placing Shares at the
Issue Price on the terms and subject to the conditions in the
Placing Agreement
"Placing Agreement" the conditional agreement dated 9 September 2020 between the
Company and Arden, relating
to the Placing
"Receiving Agent", "Registrar", or "Share Registrars" Share Registrars Limited The Courtyard, 17 West Street,
Farnham, Surrey GU9 7DR
"Regulatory Information Service" a service approved by the London Stock Exchange for the
distribution to the public of AIM
announcements and included within the list on the website of
the London Stock Exchange
"Restricted Jurisdictions" the United States, Australia, Canada, Japan, New Zealand,
Republic of South Africa , Russia
and any other jurisdiction where the extension or availability
of the Placing would breach
any applicable law
"Securities Act" the United States Securities Act of 1933, as amended
"Shareholders" registered holders of Ordinary Shares
"Subscribers" certain persons including each of the Directors, Anthony Best
and Bluebell Investment & Consulting
GmbH (a company controlled by Nicholas Money-Kyrle) who propose
to subscribe for the Subscription
Shares pursuant to the Subscription Agreements
"Subscriptions" the proposed conditional subscriptions by the Subscribers for
the Subscription Shares at the
Issue Price proposed to be made on the terms and subject to the
conditions set out in the
Subscription Agreements
"Subscription Agreements" the conditional letter agreements proposed to be entered into
between the Company and each
of the Subscribers, relating to the Subscriptions
"Subscription Shares" the 16,571,424 new Ordinary Shares which are proposed to be
issued pursuant to the Subscriptions
"UK" the United Kingdom of Great Britain and Northern Ireland
"UKLA" the UK Listing Authority, being the FCA acting as the competent
authority for the purposes
of Part VI of the FSMA
"uncertificated" or " in uncertificated form" a share or other security recorded on the relevant register of
the share or security concerned
as being held in uncertificated form in CREST and title to
which, by virtue of the CREST Regulations,
may be transferred by means of CREST
APPIX
TERMS AND CONDITIONS OF THE PLACING
IMPORTANT INFORMATION FOR PLACEES ONLY
MEMBERS OF THE PUBLIC ARE NOT ELIGIBLE TO TAKE PART IN THE
PLACING. THIS ANNOUNCEMENT (INCLUDING THE APPIX) AND THE TERMS AND
CONDITIONS SET OUT HEREIN (TOGETHER, THIS "ANNOUNCEMENT") ARE
DIRECTED ONLY AT PERSONS WHOSE ORDINARY ACTIVITIES INVOLVE THEM IN
ACQUIRING, HOLDING, MANAGING AND DISPOSING OF INVESTMENTS (AS
PRINCIPAL OR AGENT) FOR THE PURPOSES OF THEIR BUSINESS AND WHO HAVE
PROFESSIONAL EXPERIENCE IN MATTERS RELATING TO INVESTMENTS AND ARE:
(1) IF IN A MEMBER STATE OF THE EUROPEAN ECONOMIC AREA ("EEA"),
QUALIFIED INVESTORS AS DEFINED IN ARTICLE 2(e) OF THE PROSPECTUS
REGULATION (EU) 2017/1129 AND SUPPLEMENTS THERETO (THE "PROSPECTUS
REGULATION"); (2) IF IN THE UNITED KINGDOM, QUALIFIED INVESTORS WHO
(A) FALL WITHIN ARTICLE 19(5) OF THE FINANCIAL SERVICES AND MARKETS
ACT 2000 (FINANCIAL PROMOTION) ORDER 2005, AS AMED (THE "ORDER")
(INVESTMENT PROFESSIONALS) OR (B) FALL WITHIN ARTICLE 49(2)(a) TO
(d) (HIGH NET WORTH COMPANIES, UNINCORPORATED ASSOCIATIONS, ETC.)
OF THE ORDER; OR (3) PERSONS TO WHOM IT MAY OTHERWISE LAWFULLY BE
COMMUNICATED (ALL SUCH PERSONS TOGETHER BEING REFERRED TO AS
"RELEVANT PERSONS").
DISTRIBUTION OF THIS ANNOUNCEMENT IN CERTAIN JURISDICTIONS MAY
BE RESTRICTED OR PROHIBITED BY LAW OR REGULATION. PERSONS
DISTRIBUTING THIS ANNOUNCEMENT MUST SATISFY THEMSELVES THAT IT IS
LAWFUL TO DO SO.
The Placing Shares have not been and will not be registered
under the United States Securities Act of 1933, as amended (the
"Securities Act") or under the securities laws of any state or
other jurisdiction of the United States and may not be offered,
sold, resold or delivered, directly or indirectly, in or into the
United States, except pursuant to an exemption from, or in a
transaction not subject to, the registration requirements of the
Securities Act. No public offering of the Placing Shares is being
made in the United States. The Placing (as defined below) is being
made solely outside the United States to persons in offshore
transactions (as defined in Regulation S under the Securities Act
("Regulation S")) meeting the requirements of Regulation S. Persons
receiving this announcement (including custodians, nominees and
trustees) must not forward, distribute, mail or otherwise transmit
it in or into the United States or use the United States mails,
directly or indirectly, in connection with the Placing.
This Announcement does not constitute an offer to sell or issue
or a solicitation of an offer to buy or subscribe for Placing
Shares in any Restricted Jurisdiction. This announcement and the
information contained herein are not for publication or
distribution, directly or indirectly, to persons in a Restricted
Jurisdiction unless permitted pursuant to an exemption under the
relevant local law or regulation in any such jurisdiction. No
action has been taken by the Company, Arden or any Arden Affiliates
or Haydale Affiliates (as defined below) that would permit an offer
of the Placing Shares or possession or distribution of this
Announcement or any other publicity material relating to such
Placing Shares in any jurisdiction where action for that purpose is
required. Persons receiving this Announcement are required to
inform themselves about and to observe any such restrictions.
All offers of the Placing Shares will be made pursuant to an
exemption under the Prospectus Regulation from the requirement to
produce a prospectus. The Placing Shares have not been approved or
disapproved by the US Securities and Exchange Commission, any state
securities commission or other regulatory authority in the United
States, nor have any of the foregoing authorities passed upon or
endorsed the merits of the Placing or the accuracy or adequacy of
this Announcement. Any representation to the contrary is a criminal
offence in the United States. The relevant clearances have not
been, nor will they be, obtained from the securities commission of
any province or territory of Canada, no prospectus has been lodged
with, or registered by, the Australian Securities and Investments
Commission or the Japanese Ministry of Finance; the relevant
clearances have not been, and will not be, obtained for the South
Africa Reserve Bank or any other applicable body in the Republic of
South Africa in relation to the Placing Shares and the Placing
Shares have not been, nor will they be, registered under or offered
in compliance with the securities laws of any state, province or
territory of Australia, Canada, Japan, New Zealand, the Republic of
South Africa or Russia. Accordingly, the Placing Shares may not
(unless an exemption under the relevant securities laws is
applicable) be offered, sold, resold or delivered, directly or
indirectly, in or into Australia, Canada, Japan, New Zealand, the
Republic of South Africa, Russia or any other jurisdiction outside
the United Kingdom.
Persons (including, without limitation, nominees and trustees)
who have a contractual or other legal obligation to forward a copy
of this Announcement should seek appropriate advice before taking
any action.
Any indication in this Announcement of the price at which the
existing Ordinary Shares have been bought or sold in the past
cannot be relied upon as a guide to future performance. Persons
needing advice should consult an independent financial adviser.
No statement in this Announcement is intended to be a profit
forecast and no statement in this Announcement should be
interpreted to mean that earnings per share of the Company for the
current or future financial years would necessarily match or exceed
the historical published earnings per share of the Company.
Neither the content of the Company's website (or any other
website) nor the content of any website accessible from hyperlinks
on the Company's website (or any other website) is incorporated
into or forms part of this Announcement.
Arden, which is authorised and regulated in the United Kingdom
by the FCA, is acting for Haydale and for no one else in connection
with the Placing and will not regard any other person (whether or
not a recipient of this document) as a client in relation to the
Placing or Admission and will not be responsible to anyone other
than Haydale for providing the protections afforded to clients of
Arden or for affording advice in relation to the Placing or
Admission, or any other matters referred to herein.
By participating in the Placing, each person who is invited to
and who chooses to participate in the Placing (a "Placee") by
making or accepting an oral and/or written legally binding offer to
subscribe for Placing Shares is deemed to have read and understood
this Announcement in its entirety (including this Appendix) and to
be providing the representations, warranties, undertakings,
agreements and acknowledgements contained herein.
EACH PLACEE SHOULD CONSULT WITH ITS OWN ADVISERS AS TO LEGAL,
REGULATORY, TAX, BUSINESS AND RELATED ASPECTS OF A SUBSCRIPTION FOR
PLACING SHARES.
Details of the Placing Agreement and the Placing Shares
The Company has today entered into the Placing Agreement with
Arden. Pursuant to the Placing Agreement, Arden has, subject to the
terms and conditions set out therein, agreed to use reasonable
endeavours, as agent of the Company, to procure subscribers for the
Placing Shares pursuant to the Bookbuilding Process described in
this Announcement and as set out in the Placing Agreement.
The Placing is conditional on the Placing becoming unconditional
and not being terminated in accordance with the terms of the
Placing Agreement.
The Placing is not being underwritten. No element of the
Fundraising is being underwritten.
The Placing Shares will, when issued, be subject to the
Articles, be credited as fully paid and rank pari passu in all
respects with each other and with the Ordinary Shares then in
issue, including the right to receive all dividends and other
distributions declared, made or paid in respect of the Ordinary
Shares after the date of Admission.
The Placing Shares will be issued free of any encumbrance, lien
or other security interest.
Application for listing and admission to trading
Application will be made to the London Stock Exchange for the
Placing Shares to be admitted to AIM. Subject to the satisfaction
or waiver of the conditions of the Placing Agreement
("Conditions"), it is expected that Admission will take place and
dealings in the Placing Shares will commence on AIM on or around
8.00 a.m. on 15 September 2020.
Bookbuilding Process
Commencing today, Arden will be conducting the Bookbuilding
Process to determine demand for participation in the Placing by
Placees. This Announcement gives details of the terms and
conditions of, and the mechanics of participation in, the Placing.
However, Arden will be entitled to effect the Placing by such
alternative method to the Bookbuilding Process as it may, after
consultation with the Company, determine. No commissions will be
paid by or to Placees in respect of any participation in the
Placing or subscription for Placing Shares.
Participation in, and principal terms of, the Bookbuilding
Process
Participation in the Placing is by invitation only and will only
be available to persons who may lawfully be, and are, invited to
participate by Arden. Arden and Arden Affiliates are entitled to
participate as Placees in the Bookbuilding Process.
The Bookbuilding Process will establish the number of Placing
Shares to be issued pursuant to the Placing.
The book will open with immediate effect. The Bookbuilding
Process is expected to close not later than 4.30 p.m. on 9
September 2020, but may be closed at such earlier or later time as
Arden may, in its absolute discretion (after consultation with the
Company), determine. The Result of Bookbuild Announcement will be
released following the close of the Bookbuilding Process.
A bid in the Bookbuilding Process will be made on the terms and
conditions in this Announcement and will be legally binding on the
Placee on behalf of which it is made and, except with Arden's
consent, will not be capable of variation or revocation after the
close of the Bookbuilding Process.
A Placee who wishes to participate in the Bookbuilding Process
should communicate its bid by telephone to its usual sales contact
at Arden. Each bid should either state the number of Placing Shares
which the prospective Placee wishes to subscribe for or a fixed
monetary amount at, in either case, the Issue Price. If successful,
Arden will re-contact and confirm orally to Placees following the
close of the Bookbuilding Process the size of their respective
allocations and a trade confirmation will be despatched as soon as
possible thereafter. Arden's oral confirmation of the size of
allocations and each Placee's oral commitments to accept the same
will constitute an irrevocable legally binding agreement in favour
of the Company and Arden pursuant to which each such Placee will be
required to accept the number of Placing Shares allocated to the
Placee at the Issue Price on the terms and subject to the
conditions set out herein and in accordance with the Articles. Each
Placee's allocation and commitment will be evidenced by a trade
confirmation issued to such Placee by Arden. The terms of this
Appendix will be deemed incorporated in that trade
confirmation.
Arden reserves the right to scale back the number of Placing
Shares to be subscribed by any Placee in the event that the Placing
is oversubscribed. Arden also reserves the right not to accept
offers to subscribe for Placing Shares or to accept such offers in
part rather than in whole. The acceptance and, if applicable,
scaling back of offers shall be at the absolute discretion of
Arden.
Each Placee's obligations will be owed to the Company and to
Arden. Following the oral confirmation referred to above, each
Placee will also have an immediate, separate, irrevocable and
binding obligation, owed to the Company and Arden, as agent of the
Company, to pay to Arden (or as Arden may direct) in cleared funds
an amount equal to the product of the Issue Price and the number of
Placing Shares allocated to such Placee.
To the fullest extent permissible by law, none of Arden, any
holding company of Arden, any subsidiary of Arden, any subsidiary
of any such holding company, any branch, affiliate or associated
undertaking of any such company nor any of their respective
directors, officers and employees (each an "Arden Affiliate") nor
any person acting on their behalf shall have any liability to
Placees (or to any other person whether acting on behalf of a
Placee or otherwise). In particular, none of Arden, any Arden
Affiliate nor any person acting on their behalf shall have any
liability (including, to the extent legally permissible, any
fiduciary duties), in respect of its conduct of the Bookbuilding
Process or of such alternative method of effecting the Placing as
Arden may determine.
Information to Distributors
Solely for the purposes of the product governance requirements
contained within: (a) EU Directive 2014/65/EU on markets in
financial instruments, as amended ("MiFID II"); (b) Articles 9 and
10 of Commission Delegated Directive (EU) 2017/593 supplementing
MiFID II; and (c) local implementing measures (together, the
"Product Governance Requirements"), and disclaiming all and any
liability, whether arising in tort, contract or otherwise, which
any "manufacturer" (for the purposes of the Product Governance
Requirements) may otherwise have with respect thereto, the
securities referred to in this Announcement will be subject to a
product approval process, which is expected to determine that the
securities are: (i) compatible with an end target market of retail
investors and investors who meet the criteria of professional
clients and eligible counterparties, each as defined in MiFID II;
and (ii) eligible for distribution through all distribution
channels as are permitted by MiFID II (the "Target Market
Assessment").
Notwithstanding the Target Market Assessment, recipients of this
Announcement should note that: the price of the securities may
decline and investors could lose all or part of their investment;
the securities offer no guaranteed income and no capital
protection; and an investment in the securities is compatible only
with investors who do not need a guaranteed income or capital
protection, who (either alone or in conjunction with an appropriate
financial or other adviser) are capable of evaluating the merits
and risks of such an investment and who have sufficient resources
to be able to bear any losses that may result therefrom.
The Target Market Assessment is without prejudice to the
requirements of any contractual, legal or regulatory selling
restrictions in relation to the Placing. Furthermore it is noted
that, notwithstanding the Target Market Assessment, Arden will only
procure investors who meet the criteria of professional clients and
eligible counterparties. For the avoidance of doubt, the Target
Market Assessment does not constitute: (a) an assessment of
suitability or appropriateness for the purposes of MiFID II; or (b)
a recommendation to any investor or group of investors to invest
in, or purchase, or take any other action whatsoever with respect
to the securities.
Each distributor is responsible for undertaking its own target
market assessment in respect of the securities and for determining
appropriate distribution channels.
Persons who are invited to and who choose to participate in the
Placing, by making an oral and legally binding offer to acquire
Placing Shares will be deemed to have read and understood this
Announcement in its entirety and to be making such offer to acquire
Placing Shares on the terms and conditions, and to be providing the
representations, warranties, acknowledgements and undertakings
contained in this Appendix.
In this Appendix, unless the context otherwise requires,
"Placee" means a Relevant Person (including individuals, funds or
others) by whom or on whose behalf a commitment to take up Placing
Shares has been given and who has been invited to participate in
the Placing by Arden.
All obligations of Arden under the Placing will be subject to
fulfilment of the conditions referred to in this Announcement
including without limitation those referred to below under
"Conditions of the Placing".
Conditions of the Placing
The Placing is conditional upon the Placing becoming
unconditional and not having been terminated in accordance with the
terms of the Placing Agreement.
The obligations of Arden under the Placing Agreement are
conditional, amongst other things, on:
1. the warranties on the part of the Company contained in the
Placing Agreement being true and accurate and not misleading on and
as of the date of the Placing Agreement and at all times during the
period up to and including Admission;
2. the performance by the Company of its obligations under the
Placing Agreement to the extent that they fall to be performed
prior to Admission;
3. the obligations of Arden not having been terminated (as
described below under "Right to terminate under the Placing
Agreement"); and
4. Admission occurring not later than 8.00 a.m. on 15 September
2020 or such later time and/or date as Arden may agree in writing
with the Company (but in any event not later than 8.00 a.m. on 29
September 2020).
If (a) the Conditions of the Placing are not fulfilled (or to
the extent permitted under the Placing Agreement waived by Arden),
or (b) the Placing Agreement is terminated in the circumstances
specified below, the Placing will lapse and each Placee's rights
and obligations hereunder shall cease and determine at such time
and no claim may be made by a Placee in respect thereof. None of
Arden, the Company, any Arden Affiliate, nor any holding company of
the Company, any subsidiary of the Company, any subsidiary of any
such holding company, any branch, affiliate or associated
undertaking of any such company nor any of their respective
directors, officers and employees (each a "Haydale Affiliate")
shall have any liability to any Placee (or to any other person
whether acting on behalf of a Placee or otherwise) in respect of
any decision it may make as to whether or not to waive or to extend
the time and/or date for the satisfaction of any condition in the
Placing Agreement or in respect of the Placing generally.
By participating in the Placing, each Placee agrees that Arden's
rights and obligations in respect of the Placing terminate, inter
alia, in the circumstances described below under "Right to
terminate under the Placing Agreement".
Right to terminate under the Placing Agreement
Arden may, at any time before Admission and in its absolute
discretion, terminate the Placing Agreement with immediate effect
if, amongst other things:
1. any statement contained in any investor presentation or any
announcement relating to the Placing is untrue, incorrect or
misleading in any respect or that matters have arisen which
constitute a significant new factor;
2. any of the warranties, was, when given, or becomes, untrue, inaccurate or misleading;
3. the Company has failed to comply materially with any of its
obligations under the Placing Agreement;
4. any of the Conditions of the Placing have become incapable of fulfilment;
5. there has occurred any material adverse change affecting the
financial condition, operations, earnings, business affairs or
prospects of the Company and its subsidiaries; or
6. there has occurred any international crisis, act of
terrorism, outbreak of hostilities, change in national or
international financial, monetary, economic, industrial, political
or market conditions including fluctuations in exchange rates, or
the suspension of trading in securities generally on the London
Stock Exchange or the New York Stock Exchange (including a material
deterioration in, or a material escalation in response to, the
coronavirus outbreak, being the disease named as "COVID-19" by the
World Health Organisation on 11 February 2020), or trading is
limited or minimum prices established on any such exchange, or the
declaration of a banking moratorium in London or by the US Federal
or New York State authorities or material disruption to any
commercial banking or securities settlement services in the US or
the UK, or there comes into effect any government regulation which
Arden in its absolute discretion believe is, will or may be
materially prejudicial to the Company or to the successful outcome
of the Placing.
By participating in the Placing, each Placee agrees with Arden
that the exercise by Arden of any right of termination or other
discretion under the Placing Agreement shall be within the absolute
discretion of Arden and that Arden need not make any reference to
the Placees in this regard and that, to the fullest extent
permitted by law, neither the Company, Arden, any Arden Affiliate
nor any Haydale Affiliate shall have any liability whatsoever to
the Placees in connection with any such exercise or failure to so
exercise.
No Prospectus
No offering document or prospectus has been or will be prepared
in relation to the Placing and no such prospectus is required (in
accordance with the Prospectus Regulation) to be published or
submitted to be approved by the FCA and Placees' commitments will
be made solely on the basis of the information contained in this
Announcement. In the United Kingdom, this Announcement is being
directed solely at persons in circumstances in which section 21(1)
of the Financial Services and Markets Act 2000 (as amended) does
not apply.
Each Placee, by accepting a participation in the Placing, agrees
that the content of this Announcement is exclusively the
responsibility of the Company and confirms to Arden and the Company
that it has neither received nor relied on any information,
representation, warranty or statement made by or on behalf of Arden
(other than the amount of the relevant Placing participation in the
oral confirmation given to Placees and the trade confirmation
referred to below), any Arden Affiliate, any persons acting on its
or their behalf or the Company or any Haydale Affiliate and none of
Arden, any Arden Affiliate, any persons acting on their behalf, the
Company, any Haydale Affiliate nor any persons acting on their
behalf will be liable for the decision of any Placee to participate
in the Placing based on any other information, representation,
warranty or statement which the Placee may have obtained or
received (regardless of whether or not such information,
representation, warranty or statement was given or made by or on
behalf of any such persons). By participating in the Placing, each
Placee acknowledges to and agrees with Arden for itself and as
agent for the Company that, except in relation to the information
contained in this Announcement, it has relied on its own
investigation of the business, financial or other position of the
Company in deciding whether to participate in the Placing. Nothing
in this paragraph shall exclude the liability of any person for
fraudulent misrepresentation.
Lock-up
The Company has undertaken to Arden that for a period of 60
calendar days after the date of Admission, it will not, without the
prior consent of Arden (such consent not to be unreasonably
withheld or delayed) enter into certain transactions involving or
relating to the Ordinary Shares, subject to certain exceptions
agreed between Arden and the Company.
By participating in the Placing, Placees agree that the exercise
by Arden of any power to grant consent to waive the undertaking by
the Company of a transaction which would otherwise be subject to
the lock-up under the Placing Agreement shall be within the
absolute discretion of Arden and that they need not make any
reference to, or consultation with, Placees and that they shall
have no liability to Placees whatsoever in connection with any such
exercise of the power to grant consent.
Registration and settlement
Settlement of transactions in the Placing Shares following
Admission will take place within the CREST system, using the DVP
mechanism, subject to certain exceptions. Arden reserves the right
to require settlement for and delivery of the Placing Shares to
Placees by such other means as Arden may deem necessary, including,
without limitation, if delivery or settlement is not possible or
practicable within the CREST system within the timetable set out in
this Announcement or would not be consistent with the regulatory
requirements in the Placee's jurisdiction.
The expected timetable for settlement will be as follows:
Trade Date 10 September 2020
Settlement Date 15 September 2020
ISIN Code GB00BKWQ1135
SEDOL BKWQ113
Deadline for input instruction into CREST 3.00 p.m. on 15 September 2020
CREST ID for Arden 601
Each Placee allocated Placing Shares in the Placing will be sent
a trade confirmation stating the number of Placing Shares allocated
to it, the Issue Price, the aggregate amount owed by such Placee to
Arden and settlement instructions. Placees should settle against
the Arden CREST ID shown above. It is expected that such trade
confirmation will be despatched on the expected trade date shown
above. Each Placee agrees that it will do all things necessary to
ensure that delivery and payment is completed in accordance with
either the standing CREST or certificated settlement instructions
which it has in place with Arden.
It is expected that settlement will take place on the Settlement
Date shown above on a DVP basis in accordance with the instructions
set out in the trade confirmation unless otherwise notified by
Arden.
Interest is chargeable daily on payments not received from
Placees on the due date in accordance with the arrangements set out
above at the rate of two percentage points above the base rate of
Barclays Bank Plc.
Each Placee is deemed to agree that if it does not comply with
these obligations, Arden may sell any or all of the Placing Shares
allocated to the Placee on such Placee's behalf and retain from the
proceeds, for Arden's own account and profit, an amount equal to
the aggregate amount owed by the Placee plus any interest due. The
Placee will, however, remain liable for any shortfall below the
aggregate amount owed by such Placee and it may be required to bear
any stamp duty or stamp duty reserve tax (together with any
interest or penalties) which may arise upon the sale of such
Placing Shares on such Placee's behalf.
If Placing Shares are to be delivered to a custodian or
settlement agent, the Placee should ensure that the trade
confirmation is copied and delivered immediately to the relevant
person within that organisation.
Insofar as Placing Shares are registered in the Placee's name or
that of its nominee or in the name of any person for whom the
Placee is contracting as agent or that of a nominee for such
person, such Placing Shares will, subject as provided below, be so
registered free from any liability to any levy, stamp duty or stamp
duty reserve tax. If there are any circumstances in which any other
stamp duty or stamp duty reserve tax is payable in respect of the
issue of the Placing Shares, neither Arden nor the Company shall be
responsible for the payment thereof. Placees will not be entitled
to receive any fee or commission in connection with the
Placing.
Representations, warranties and terms
By participating in the Placing, each Placee (and any person
acting on such Placee's behalf):
1. represents and warrants that it has read and understood this
Announcement in its entirety (including this Appendix) and
acknowledges that its participation in the Placing and the issue of
the Placing Shares will be governed by the terms of this
Announcement (including this Appendix);
2. acknowledges that no prospectus or offering document has been
or will be prepared in connection with the Placing and it has not
received and will not receive a prospectus or other offering
document in connection with the Bookbuilding Process, the Placing
or the Placing Shares;
3. agrees to indemnify on an after-tax basis and hold harmless
each of the Company, Arden, Arden Affiliates and Haydale Affiliates
and any person acting on their behalf from any and all costs,
losses, claims, liabilities and expenses (including legal fees and
expenses) arising out of or in connection with any breach of the
representations, warranties, acknowledgements, agreements and
undertakings in this Announcement and further agrees that the
provisions of this Announcement shall survive after completion of
the Placing;
4. acknowledges that the Placing Shares will be admitted to AIM
and the Company is therefore required to publish and has published
certain business and financial information in accordance with the
AIM Rules and MAR and other applicable laws and regulations (the
"Exchange Information"), which includes certain business and
financial and the Company's announcements and circulars published
in the past 12 months, and that the Placee is able to obtain or
access this Exchange Information without undue difficulty and is
aware of the contents of the Exchange Information;
5. acknowledges that none of Arden, any Arden Affiliate or any
person acting on their behalf has provided, and will not provide,
it with any material or information regarding the Placing Shares or
the Company; nor has it requested any of Arden, nor any Arden
Affiliate nor any person acting on their behalf to provide it with
any such material or information;
6. acknowledges that (i) none of Arden or any Arden Affiliate or
any person acting on behalf of any of them is making any
recommendations to it, advising it regarding the suitability of any
transactions it may enter into in connection with the Placing and
that participation in the Placing is on the basis that it is not
and will not be a client of Arden and that Arden does not have any
duties or responsibilities to it (or any person acting on behalf of
a Placee) for providing the protections afforded to its clients or
for providing advice in relation to the Placing nor in respect of
any representations, warranties, undertakings, agreements or
indemnities contained in the Placing Agreement nor for the exercise
or performance of any of its rights and obligations thereunder
including any rights to waive or vary any conditions or exercise
any termination right, and (ii) neither it nor, as the case may be,
its clients expect Arden to have any duties or responsibilities to
it similar or comparable to the duties of "best execution" and
"suitability" imposed by the Conduct of Business Sourcebook
contained in the FCA's Handbook of Rules and Guidance, and that
Arden is not acting for it or its clients, and that Arden will not
be responsible to any person other than the Company for providing
protections afforded to its clients;
7. acknowledges that the content of this Announcement is
exclusively the responsibility of the Company and that none of
Arden, nor any Arden Affiliate nor any person acting on their
behalf will be responsible for or shall have any liability for any
information, representation or statement relating to the Company
contained in this Announcement or any information previously
published by or on behalf of the Company and none of Arden, nor any
Arden Affiliate nor any person acting on their behalf will be
liable for any Placee's decision to participate in the Placing
based on any information, representation or statement contained in
this Announcement or otherwise. Each Placee further represents,
warrants and agrees that the only information on which it is
entitled to rely and on which such Placee has relied in committing
to subscribe for the Placing Shares is contained in this
Announcement, such information being all that it deems necessary to
make an investment decision in respect of the Placing Shares, and
that it has relied on its own investigation with respect to the
Placing Shares and the Company in connection with its decision to
subscribe for the Placing Shares and acknowledges that it is not
relying on any other information whatsoever and in particular it is
not relying on any investigation that Arden, any Arden Affiliate or
any person acting on their behalf may have conducted with respect
to the Placing Shares or the Company and none of such persons has
made any representations to it, express or implied, with respect
thereto;
8. acknowledges that it has knowledge and experience in
financial, business and international investment matters as is
required to evaluate the merits and risks of subscribing for the
Placing Shares. It further acknowledges that it is experienced in
investing in securities of this nature and is aware that it may be
required to bear, and is able to bear, the economic risk of, and is
able to sustain, a complete loss in connection with the Placing. It
has had sufficient time to consider and conduct its own
investigation in connection with its subscription for the Placing
Shares, including all tax, legal and other economic considerations
and has relied upon its own examination of, and due diligence on,
the Company, and the terms of the Placing, including the merits and
risks involved;
9. unless paragraph 10 applies, represents and warrants that it
has neither received nor relied on any inside information for the
purposes of MAR and section 56 of the Criminal Justice Act 1993
(the "CJA") in relation to the Company or its participation in the
Placing;
10. it acknowledges and agrees that, if it has received any
inside information (for the purpose of MAR and section 56 of the
CJA) in relation to the Company and its securities in advance of
the Placing, it has consented to receive inside information for the
purposes of MAR and the CJA and it acknowledges that it was an
insider or a person who has received a market sounding for the
purpose of such legislation and it confirms that it has not: (a)
dealt (or attempted to deal) in the securities of the Company (or
cancelled or amended an order in relation thereto); (b) encouraged,
recommended or induced another person to deal in the securities of
the Company (or to cancel or amend an order in relation thereto);
(c) unlawfully disclosed inside information to any person, in each
case, prior to the information being made publicly available;
11. acknowledges that it is not entitled to rely on any
information (including, without limitation, any information
contained in any management presentation given in relation to the
Placing) other than that contained in this Announcement (including
this Appendix) and any Exchange Information and represents and
warrants that it has not relied on any representations relating to
the Placing, the Placing Shares or the Company other than the
information contained in this Announcement or in any Exchange
Information;
12. acknowledges that it has not relied on any information
relating to the Company contained in any research reports prepared
by Arden or any Arden Affiliate or any person acting on their
behalf and understands that (i) none of Arden, nor any Arden
Affiliate nor any person acting on their behalf has or shall have
any liability for any public information relating to the Company or
otherwise or any representation; (ii) none of Arden, nor any Arden
Affiliate, nor any person acting on their behalf has or shall have
any liability for any additional information that has otherwise
been made available to such Placee, whether at the date of
publication, the date of this Announcement or otherwise; and that
(iii) none of Arden, nor any Arden Affiliate, nor any person acting
on their behalf makes any representation or warranty, express or
implied, as to the truth, accuracy or completeness of such
information, whether at the date of publication, the date of this
Announcement or otherwise;
13. represents and warrants that (i) it is entitled to acquire
the Placing Shares for which it is subscribing under the laws and
regulations of all relevant jurisdictions which apply to it; (ii)
it has fully observed such laws and regulations and obtained all
such governmental and other guarantees and other consents and
authorities which may be required or necessary in connection with
its subscription for Placing Shares and its participation in the
Placing and has complied with all other necessary formalities in
connection therewith; (iii) it has all necessary capacity to commit
to participation in the Placing and to perform its obligations in
relation thereto and will honour such obligations; (iv) it has paid
any issue, transfer or other taxes due in connection with its
subscription for Placing Shares and its participation in the
Placing in any territory; and (v) it has not taken any action which
will or may result in the Company, Arden or any Arden Affiliate or
Haydale Affiliate or any person acting on their behalf being in
breach of the legal and/or regulatory requirements of any territory
in connection with the Placing;
14. represents and warrants that it understands that the Placing
Shares have not been and will not be registered under the
Securities Act or under the securities laws of any state or other
jurisdiction of the United States and are not being offered or sold
within the United States, except pursuant to an exemption from, or
in a transaction not subject to, the registration requirements of
the Securities Act;
15. represents and warrants that its acquisition of the Placing
Shares has been or will be made in an "offshore transaction" as
defined in and pursuant to Regulation S;
16. represents and warrants that it will not offer or sell,
directly or indirectly, any of the Placing Shares in the United
States except in accordance with Regulation S or pursuant to an
exemption from, or in a transaction not subject to, the
registration requirements of the Securities Act;
17. represents and warrants that, if it is a financial
intermediary, as that term is used in Article 5(1) of the
Prospectus Regulation, the Placing Shares purchased by it in the
Placing will not be acquired on a non-discretionary basis on behalf
of, nor will they be acquired with a view to their offer or resale
to, persons in a member state of the EEA which has implemented the
Prospectus Regulation other than "qualified investors" as defined
in Article 2(e) of the Prospectus Regulation, or in circumstances
in which the prior consent of Arden has been given to such an offer
or resale;
18. represents and warrants that it has not offered or sold and
will not offer or sell any Placing Shares to the public in any
member state of the EEA except in circumstances falling within
Article 3(2) of the Prospectus Regulation which do not result in
any requirement for the publication of a prospectus pursuant to
Article 3 of the Prospectus Regulation;
19. represents and warrants that it has only communicated or
caused to be communicated and will only communicate or cause to be
communicated any invitation or inducement to engage in investment
activity (within the meaning of section 21 of FSMA) relating to the
Placing Shares in circumstances in which it is permitted to do so
pursuant to section 21 of FSMA;
20. represents and warrants that it has complied and will comply
with all applicable provisions of FSMA with respect to anything
done by it in relation to the Placing Shares in, from or otherwise
involving, the United Kingdom;
21. represents and warrants that it has complied with its
obligations: (i) under the CJA and MAR; (ii) in connection with the
laws of all relevant jurisdictions which apply to it and it has
complied, and will fully comply, with all such laws (including
where applicable, the Criminal Justice Act 1988, the Terrorism Act
2000, the Anti-Terrorism, Crime and Security Act 2001, the Proceeds
of Crime Act 2002 (as amended) , the Terrorism Act 2006, the
Counter-Terrorism Act 2008 and the Money Laundering, Terrorist
Financing and Transfer of Funds (Information on the Payer)
Regulations 2017) and that it is not a person: (a) with whom
transactions are prohibited under the Foreign Corrupt Practices Act
1977 or any economic sanction programmes administered by, or
regulations promulgated by, the Office of Foreign Assets Control of
the U.S. Department of the Treasury; (b) named on the Consolidated
List of Financial Sanctions Targets maintained by HM Treasury of
the United Kingdom; or (c) subject to financial sanctions imposed
pursuant to a regulation of the European Union or a regulation
adopted by the United Nations ((i), (ii), (a) and (b), together,
the "Regulations") and rules and guidance on anti-money laundering
produced by the Financial Conduct Authority ("FCA") and, if it is
making payment on behalf of a third party, that satisfactory
evidence has been obtained and recorded by it to verify the
identity of the third party as required by the Regulations; and it
is permitted to subscribe for Placing Shares in accordance with the
laws of all relevant jurisdictions which apply to it and it has
complied, and will fully comply, with all such laws (including
where applicable, the Anti-Terrorism, Crime and Security Act 2001,
the Terrorism Act 2006, the Counter-Terrorism Act 2008, the
Proceeds of Crime Act 2002 (as amended) and the Money Laundering,
Terrorist Financing and Transfer of Funds (Information on the
Payer) Regulations 2017);
22. if in the United Kingdom, represents and warrants that: (a)
it is a person having professional experience in matters relating
to investments who falls within the definition of "investment
professionals" in Article 19(5) of the FPO, or (b) it is a person
who falls within Article 49(2) (a) to (d) ("High Net Worth
Companies, Unincorporated Associations etc.") of the FPO and (c) it
is a qualified investor as defined in Article 2(e) of the
Prospectus Regulation and (d) it is person to whom this
Announcement may otherwise lawfully be communicated;
23. represents and warrants that its participation in the
Placing would not give rise to an offer being required to be made
by it or any person with whom it is acting in concert pursuant to
Rule 9 of the City Code on Takeovers and Mergers;
24. undertakes that it (and any person acting on its behalf)
will pay for the Placing Shares acquired by it in accordance with
this Announcement and with any trade confirmation sent by Arden (or
on its behalf) to it in respect of its allocation of Placing Shares
and its participation in the Placing on the due time and date set
out herein against delivery of such Placing Shares to it, failing
which the relevant Placing Shares may be placed with other Placees
or sold as Arden may, in its absolute discretion, determine and it
will remain liable for any shortfall below the net proceeds of such
sale and the placing proceeds of such Placing Shares and may be
required to bear any stamp duty or stamp duty reserve tax (together
with any interest or penalties due pursuant to the terms set out or
referred to in this Announcement) which may arise upon the sale of
such Placee's Placing Shares on its behalf;
25. acknowledges that none of Arden, nor any Arden Affiliate nor
any person acting on their behalf is making any recommendations to
it or advising it regarding the suitability or merits of any
transaction it may enter into in connection with the Placing, and
acknowledges that none of Arden, nor any Arden Affiliate nor any
person acting on their behalf has any duties or responsibilities to
it for providing advice in relation to the Placing or in respect of
any representations, warranties, undertakings or indemnities
contained in the Placing Agreement or for the exercise or
performance of any of Arden's rights and obligations thereunder,
including any right to waive or vary any condition or exercise any
termination right contained therein;
26. undertakes that (i) the person whom it specifies for
registration as holder of the Placing Shares will be (a) the Placee
or (b) the Placee's nominee, as the case may be, (ii) neither Arden
nor the Company will be responsible for any liability to stamp duty
or stamp duty reserve tax resulting from a failure to observe this
requirement and (iii) the Placee and any person acting on its
behalf agrees to acquire the Placing Shares on the basis that the
Placing Shares will be allotted to the CREST stock account of Arden
which will hold them as settlement agent as nominee for the Placee
until settlement in accordance with its standing settlement
instructions with payment for the Placing Shares being made
simultaneously upon receipt of the Placing Shares in the Placee's
stock account on a delivery versus payment basis;
27. acknowledges that any agreements entered into by it pursuant
to these terms and conditions, and any non-contractual obligations
arising out of or in connection with such agreements, shall be
governed by and construed in accordance with the laws of England
and Wales and it submits (on behalf of itself and on behalf of any
person on whose behalf it is acting) to the exclusive jurisdiction
of the courts of England and Wales as regards any claim, dispute or
matter arising out of any such contract;
28. acknowledges that it irrevocably appoints any director of
Arden as its agent for the purposes of executing and delivering to
the Company and/or its registrars any documents on its behalf
necessary to enable it to be registered as the holder of any of the
Placing Shares agreed to be taken up by it under the Placing;
29. represents and warrants that it is not a resident of any
Restricted Jurisdiction and acknowledges that the Placing Shares
have not been and will not be registered nor will a prospectus be
cleared in respect of the Placing Shares under the securities
legislation of any Restricted Jurisdiction and, subject to certain
exceptions, may not be offered, sold, taken up, renounced,
delivered or transferred, directly or indirectly, within any
Restricted Jurisdiction;
30. represents and warrants that any person who confirms to
Arden on behalf of a Placee an agreement to subscribe for Placing
Shares and/or who authorises Arden to notify the Placee's name to
the Company's registrar, has authority to do so on behalf of the
Placee;
31. acknowledges that the agreement to settle each Placee's
acquisition of Placing Shares (and/or the acquisition of a person
for whom it is contracting as agent) free of stamp duty and stamp
duty reserve tax depends on the settlement relating only to an
acquisition by it and/or such person direct from the Company of the
Placing Shares in question. Such agreement assumes that the Placing
Shares are not being acquired in connection with arrangements to
issue depositary receipts or to issue or transfer the Placing
Shares into a clearance service. If there were any such
arrangements, or the settlement related to other dealing in the
Placing Shares, stamp duty or stamp duty reserve tax may be
payable, for which neither the Company nor Arden will be
responsible. If this is the case, the Placee should take its own
advice and notify Arden accordingly;
32. acknowledges that when a Placee or any person acting on
behalf of the Placee is dealing with Arden, any money held in an
account with Arden on behalf of the Placee and/or any person acting
on behalf of the Placee will not be treated as client money within
the meaning of the relevant rules and regulations of the FCA. The
Placee acknowledges that the money will not be subject to the
protections conferred by the client money rules; as a consequence,
this money will not be segregated in accordance with the client
money rules and will be used by Arden in the course of its
business; and the Placee will rank only as a general creditor of
Arden (as the case may be);
33. acknowledges and agrees that in order to ensure compliance
with the Criminal Justice Act 1988, the Terrorism Act 2000, the
Anti-Terrorism, Crime and Security Act 2001, the Proceeds of Crime
Act 2002 (as amended) the Terrorism Act 2006, the Counter-Terrorism
Act 2008 and the Money Laundering, Terrorist Financing and Transfer
of Funds (Information on the Payer) Regulations 2017, and, to the
extent applicable, any related or similar rules, regulations of any
body having jurisdiction in respect thereof and the Money
Laundering Sourcebook of the FCA, Arden (for itself and as agent on
behalf of the Company) or the Company's registrars may, in their
absolute discretion, require verification of its identity. Pending
the provision to Arden or the Company's registrars, as applicable,
of evidence of identity, definitive certificates in respect of the
Placing Shares may be retained at Arden's absolute discretion or,
where appropriate, delivery of the Placing Shares to it in
uncertificated form may be delayed at Arden's or the Company's
registrars', as the case may be, absolute discretion. If within a
reasonable time after a request for verification of identity Arden
(for itself and as agent on behalf of the Company) or the Company's
registrars have not received evidence satisfactory to them, Arden
and/or the Company may, at its absolute discretion, terminate its
commitment in respect of the Placing, in which event the monies
payable on acceptance of allotment will, if already paid, be
returned without interest to the account of the drawee's bank from
which they were originally debited;
34. acknowledges and understands that the Company, Arden, and
others will rely upon the truth and accuracy of the foregoing
representations, warranties, agreements, undertakings and
acknowledgements;
35. acknowledges that the basis of allocation will be determined
by Arden at its absolute discretion and that the right is reserved
to reject in whole or in part and/or scale back any participation
in the Placing;
36. irrevocably authorises the Company and Arden to produce this
Announcement pursuant to, in connection with, or as maybe required
by any applicable law or regulation, administrative or legal
proceeding or official inquiry with respect to the matters set
forth herein;
37. acknowledges and agrees that its commitment to subscribe for
Placing Shares on the terms set out herein will continue
notwithstanding any amendment that may in future be made to the
terms of the Placing and that Placees will have no right to be
consulted or require that their consent be obtained with respect to
the Company's conduct of the Placing;
38. acknowledges and agrees that time is of the essence as
regards its obligations under this Appendix;
39. acknowledges and agrees that any document that is to be sent
to it in connection with the Placing will be sent at its risk and
may be sent to it at any address provided by it to Arden;
40. acknowledges and agrees that it will be bound by the terms
of the Articles; and
41. acknowledges and agrees that these terms and conditions in
this Appendix and all documents into which this Appendix is
incorporated by reference or otherwise validly forms a part and/or
any agreements entered into pursuant to these terms and conditions
and all agreements to acquire shares pursuant to the Placing will
be governed by and construed in accordance with English law and it
submits to the exclusive jurisdiction of the English courts in
relation to any claim, dispute or matter arising out of any such
contract, except that enforcement proceedings in respect of the
obligation to make payment for the Placing Shares (together with
any interest chargeable thereon) may be taken by the Company or
Arden in any jurisdiction in which the relevant Placee is
incorporated or in which any of its securities have a quotation on
a recognised stock exchange.
The acknowledgements, agreements, undertakings, representations
and warranties referred to above are given to each of the Company
and Arden (for their own benefit and, where relevant, the benefit
of any Arden Affiliate or Haydale Affiliate and any person acting
on their behalf) and are irrevocable.
No claim shall be made against the Company, Arden, any Arden
Affiliate, any Haydale Affiliate, or any other person acting on
behalf of any of such persons by a Placee to recover any damage,
cost, loss, charge or expense which it may suffer or incur by
reason of or arising from or in connection with the performance of
its obligations hereunder or otherwise howsoever in connection with
the Placing or Admission.
No UK stamp duty or stamp duty reserve tax should be payable to
the extent that the Placing Shares are issued or transferred (as
the case may be) into CREST to, or to the nominee of, a Placee who
holds those shares beneficially (and not as agent or nominee for
any other person) within the CREST system and registered in the
name of such Placee or such Placee's nominee.
Any arrangements to issue or transfer the Placing Shares into a
depositary receipts system or a clearance service or to hold the
Placing Shares as agent or nominee of a person to whom a depositary
receipt may be issued or who will hold the Placing Shares in a
clearance service, or any arrangements subsequently to transfer the
Placing Shares, may give rise to stamp duty and/or stamp duty
reserve tax, for which neither the Company nor Arden will be
responsible and the Placee to whom (or on behalf of whom, or in
respect of the person for whom it is participating in the Placing
as an agent or nominee) the allocation, allotment, issue or
delivery of Placing Shares has given rise to such stamp duty or
stamp duty reserve tax undertakes to pay such stamp duty or stamp
duty reserve tax forthwith and to indemnify on an after-tax basis
and to hold harmless the Company and Arden in the event that any of
the Company or any Haydale Affiliate or Arden or any Arden
Affiliate has incurred any such liability to stamp duty or stamp
duty reserve tax.
In addition, Placees should note that they will be liable for
any capital duty, stamp duty and all other stamp, issue,
securities, transfer, registration, documentary or other duties or
taxes (including any interest, fines or penalties relating thereto)
payable outside the UK by them or any other person on the
acquisition by them of any Placing Shares or the agreement by them
to acquire any Placing Shares.
All times and dates in this Announcement may be subject to
amendment. Arden shall notify the Placees and any person acting on
behalf of the Placees of any such changes.
This Announcement has been issued by the Company and is the sole
responsibility of the Company.
Each Placee, and any person acting on behalf of the Placee,
acknowledges that Arden does not owe any fiduciary or other duties
to any Placee in respect of any representations, warranties,
undertakings or indemnities in the Placing Agreement.
Each Placee and any person acting on behalf of the Placee
acknowledges and agrees that Arden or any Arden Affiliate may, at
their absolute discretion, agree to become a Placee in respect of
some or all of the Placing Shares.
The rights and remedies of Arden and the Company under these
terms and conditions are in addition to any rights and remedies
which would otherwise be available to each of them and the exercise
or partial exercise or partial exercise of one will not prevent the
exercise of others.
Each Placee may be asked to disclose in writing or orally to
Arden and, if so, undertakes to provide:
1. if he is an individual, his nationality;
2. if he is a discretionary fund manager, the jurisdiction in
which the funds are managed or owned; and
3. such other "know your client" information as Arden may reasonably request.
References to time in this Announcement are to London time,
unless otherwise stated.
All times and dates in this Announcement may be subject to
amendment.
The price of shares and any income expected from them may go
down as well as up and investors may not get back the full amount
invested upon disposal of the shares. Past performance is no guide
to future performance, and persons needing advice should consult an
independent financial adviser.
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.
RNS may use your IP address to confirm compliance with the terms
and conditions, to analyse how you engage with the information
contained in this communication, and to share such analysis on an
anonymised basis with others as part of our commercial services.
For further information about how RNS and the London Stock Exchange
use the personal data you provide us, please see our Privacy
Policy.
END
IOESSSEDAESSEIU
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