TIDMSENS
RNS Number : 5050I
Sensyne Health PLC
19 April 2022
Sensyne Health plc
("Sensyne" or the "Company")
Appointment of CEO, amendments to the Financing terms,
termination of the Formal Sale Process and proposed Delisting
Oxford, U.K. - 19 April 2022: The Board of Sensyne Health plc
(LSE:SENS) today announces the appointment of Alex Snow as Chief
Executive Officer with effect from 18 April 2022. Alex's
appointment follows the execution of an amendment and restatement
agreement to the note purchase agreement with the Company's secured
lenders to provide access to additional capital of up to GBP20
million to strengthen the financial position of the business
(details of which were announced on 8 April 2022). In light of the
amended financing terms, the Board has decided to end the Formal
Sale Process with immediate effect. The terms for the financing
also provide for the delisting of the Company from AIM, subject to
the required approval of shareholders. Without access to the
additional capital provided by the noteholders pursuant to the
Amended and Restated Note Purchase Agreement, the Company is
unlikely to be able to continue to trade and would very likely
become insolvent and be placed into administration.
Amendments to the Note Purchase Agreement
On 26 January 2022, the Company entered into a note purchase
agreement with Gatemore Capital Management LLP ("Gatemore"),
Lansdowne Partners (UK) LLP ("Lansdowne"), Sand Grove Capital
Management LLP ("Sand Grove") and Peel Hunt LLP ("Peel Hunt")
(solely by virtue of Peel Hunt receiving the majority of its fee in
loan notes) (together the "Original Purchasers") to secure GBP6.35
million of loan notes and an additional GBP5 million of loan notes
to be drawn down by mutual consent.
On 18 April 2022, the Company amended and restated the note
purchase agreement (the "Amended and Restated Note Purchase
Agreement"), to provide for the issue of up to an additional GBP20
million of loan notes, bringing the total number of loan notes (the
"Loan Notes") to GBP26.35 million, purchased or to be purchased in
the following tranches:
-- a tranche of GBP6,350,000 principal amount of Loan Notes (the
"Original Notes"), which were issued to the Original Purchasers on
28 January 2022 ;
-- a tranche of GBP6,000,000 principal amount of Loan Notes (the
"Additional A Notes") to be issued to Gatemore Investment Partners
I LP , Lansdowne and MNL (Hambro Perks) Nominees Limited ("Hambro
Perks") (the "Additional A Note Purchasers") on or around 21 April
2022; and
-- two subsequent tranches of Loan Notes (the "Additional B
Notes" the "Additional C Notes", respectively, and together with
the Additional A Notes being the "Additional Notes")) which may
each be issued in any principal amount provided that the total
aggregate amount of Additional Notes does not exceed GBP20,000,000.
The Additional B Notes and Additional C Notes will be issued at the
request of the Company and allocated as follows:
o Alex Snow may subscribe for up to GBP2,000,000 of the
Additional B Notes and the Additional C Notes (in aggregate across
both tranches);
o e ach Original Purchaser (excluding Peel Hunt), Gatemore
Investment Partners I LP and Hambro Perks (the "Relevant
Purchasers") may subscribe for their pro rata proportion of the
Additional B Notes or the Additional C Notes . To the extent any
Relevant Purchaser does not exercise its right in full to subscribe
for Additional B Notes or the Additional C Notes, its remaining pro
rata share may be taken up by the other Relevant Purchasers;
and
o if the amount of Additional B Notes or Additional C Notes
subscribed for by Alex Snow and each Relevant Purchaser as
described above is less than the aggregate issuance amount of the
Additional B Notes or Additional C Notes, the Company may offer the
unallocated balance of the Additional B Notes or Additional C Notes
to any third party, save that the issuance of Additional C Notes to
a third party is subject to the unanimous consent of the Additional
A Note Purchasers.
Sub-division
Pursuant to the terms of the Amended and Restated Note Purchase
Agreement, the directors will be seeking the approval of the
shareholders to effect a sub-division and re-designation, such that
each of the ordinary shares of GBP0.10 in the capital of the
Company will be sub-divided and re-designated into one ordinary
share of GBP0.008 in the capital of the Company and one deferred
share of GBP0.092 in the capital of the Company, having the rights
to be set out in new articles of association to be adopted by the
Company (the "Sub-division").
Conversion
A portion of the principal amount of the Additional A Notes (as
would result upon conversion in the Relevant Purchasers
collectively holding 29.9 per cent. of the issued share capital of
the Company) carry unconditional rights to convert into ordinary
shares at a conversion price of GBP0.10 per ordinary share and,
following completion of the Sub-division, at a conversion price of
GBP0.008 per ordinary share.
The balance of the Loan Notes carry conditional rights to
convert into ordinary shares at a conversion price of GBP0.008 per
ordinary share, subject to the satisfaction of certain conditions,
including the passing of certain resolutions by the shareholders of
the Company (including with respect to the Sub-division) and the
grant of certain clearances by the Panel on Takeovers and Mergers
(the "Conversion Conditions").
Asset Purchase Option
If the Conversion Conditions are not satisfied within 60 days of
the date of the Amended and Restated Note Purchase Agreement, the
Relevant Purchasers will be able to exercise an asset purchase
option to require all of the material assets of the group
(including the strategic research agreements and other data
collaboration agreements) be transferred into Sensyne Health
Holdings Limited, and to then purchase the entire issued share
capital of Sensyne Health Holdings Limited for consideration of (i)
the sum of GBP1 and (ii) the assumption by the Relevant Purchasers
of all the Company's outstanding obligations in respect of the Loan
Notes (the "Asset Purchase Option").
The implementation of the Asset Purchase Option would constitute
a fundamental change of business within the meaning of Rule 15 of
the AIM Rules for Companies. Accordingly, if exercised, the Asset
Purchase Option will be conditional upon the passing of an ordinary
resolution of the Shareholders in accordance with Rule 15 of the
AIM Rules for Companies at a subsequent general meeting of the
Company.
Redemption
The Loan Notes are redeemable at 1.25 times their par value. The
Loan Notes have a maturity date of 26 January 2023, which is the
date falling 364 days following the date of utilisation of the
Original Notes. The Loan Notes are redeemable (i) on the maturity
date, and (ii) at the election of the noteholders, on a pro rata
basis in an amount equal to any net proceeds the Company receives
following the completion of any substantial equity investment,
material asset sale or recapitalisation of the Company exceeding
GBP2 million. The Loan Notes may be redeemed by the Company on a
voluntary basis (i) by giving not less than 10 business days'
notice, and (ii) at the request of a noteholder (in respect of its
Loan Notes) upon the earliest of the sale of all or substantially
all of the assets of the group or a change of control of the
Company.
Security
The Loan Notes represent senior ranking obligations of the
Company and are secured on a first and second priority basis and
guaranteed by other members of the group. The security consists of
first and second ranking fixed and floating security over
substantially all of each member of the group's assets (subject to
certain agreed exceptions).
Warrants
Under the terms of the Amended and Restated Note Purchase
Agreement, the Company has also agreed to issue to the note
purchasers, warrants to subscribe for up to 29,169,448 ordinary
shares (the "Warrants") as follows:
(a) Warrants to subscribe for 8,239,950 ordinary shares, which
were issued pro rata to the Original Purchasers at the same time as
the Original Notes;
(b) Warrants to subscribe for 12,689,541 ordinary shares, which
were issued pro rata to the Original Purchasers, following the
satisfaction of certain conditions; and
(c) Warrants to subscribe for 8,239,957 ordinary shares, to be
issued pro rata to the Additional A Note Purchasers on issue of the
Additional A Notes.
Each Warrant is exercisable at an exercise price of GBP0.10 per
ordinary share and, following completion of the Sub-division, at an
exercise price of GBP0.008 per ordinary share, at any time from the
date of issue of the Warrant until 15 January 2025.
Delisting
Pursuant to the Amended and Restated Note Purchase Agreement it
is proposed that the Company cancels the admission to trading on
AIM of the ordinary shares of the Company. The Company will seek
the approval of the shareholders for the delisting in accordance
with Rule 41 of the AIM Rules for Companies.
Approvals to be sought from the shareholders at the General
Meeting
In connection with the Amended and Restated Note Purchase
Agreement, the Company will be convening a general meeting to seek
the approval of its shareholders of certain resolutions,
including:
-- an ordinary resolution to effect the Sub-division;
-- a special resolution to amend the articles of association of
the Company to set out the rights of the deferred shares following
the Sub-Division;
-- an ordinary resolution to authorise the directors of the
Company to grant rights to convert the Loan Notes into ordinary
shares of GBP0.008 each in the capital of the Company, up to an
aggregate nominal amount of GBP26,350,000;
-- a special resolution to empower the directors of the Company
to dis-apply the statutory pre-emption rights in respect of the
grant of rights to convert the Loan Notes into ordinary shares of
GBP0.008 each in the capital of the Company, up to an aggregate
nominal amount of GBP26,350,000;
-- an ordinary resolution to authorise the directors of the
Company to issue the Warrants to subscribe for up to 29,169,448
ordinary shares of GBP0.008 each in the capital of the Company;
-- a special resolution to empower the directors of the Company
to dis-apply the statutory pre-emption rights in respect of the
issue of the Warrants to subscribe for up to 29,169,448 ordinary
shares of GBP0.008 each in the capital of the Company;
-- an ordinary resolution from independent shareholders to waive
Rule 9 of the City Code on Takeovers and Mergers which would
otherwise apply to the Additional A Note Purchasers (or such other
persons as determined by the Panel on Takeovers and Mergers) as a
result of the issue to them of ordinary shares pursuant to the
conversion of the Loan Notes and/or the exercise of the Warrants;
and
-- a special resolution, in accordance with Rule 41 of the AIM
Rules for Companies, for the cancellation of the admission to
trading on AIM of the ordinary shares.
The Circular will contain full details of the strategic
financing and the resolutions to be put to the shareholders at the
general meeting. The Company expects to publish the circular in the
first week of May and for the general meeting to be held on or
before 20 May 2022.
Commitments from the Noteholders to the NHS
The Board and the noteholders recognise the importance of the
NHS Trusts relationships in the future of a private, restructured
and refocused business and the noteholders (excluding Peel Hunt)
have agreed that they will commit to take reasonable steps to
exercise their rights under the Amended and Restated NPA in a
manner that: (i) continues the Company's ethical use of patient
data; (ii) is consistent with the Company's goal of enabling the
Company to realise its mission to become the leader in the ethical
application of clinical AI to health data, to improve patient care
and accelerate medical research; and (iii) allows for a sustainable
commercial model to be put in place with the NHS Trusts that
reflects the value of patient data supplied to the Company by the
NHS Trusts.
Termination of the Formal Sale Process
On 2 November 2021, the Company announced the launch of a
strategic review and commencement of a Formal Sale Process. Since
then, J.P. Morgan Cazenove and Peel Hunt (joint financial advisers
to the Company) have contacted a broad range of corporates and
financial sponsors to solicit interest in an offer for the Company
or strategic investment into the Company. In light of the amended
financing terms, the Board has decided to end the Formal Sale
Process with immediate effect and the ongoing discussions with the
parties referred to in the announcement of 8 April 2022 have been
terminated.
-ENDS-
Notes for editors:
About Sensyne Health : https://www.sensynehealth.com/
Sensyne Health plc (LSE: SENS) is a clinical artificial
intelligence company operating a unique business model - a
for-profit plc making a positive social impact, sharing the
financial returns it makes with health systems. The company applies
clinical AI in the healthcare and life science industries. In
healthcare, Sensyne delivers remote patient monitoring and
real-time decision-making systems for healthcare organisations and
their patients. In life sciences, Sensyne analyses large complex
anonymised data sets to help life sciences companies accelerate the
development of new medicines.
Sensyne is listed on the AIM Market of the London Stock Exchange
(SENS.L).
Contact details:
Sensyne Health
Dr Richard Pye, Chief Financial Officer +44 (0) 330 058 1845
Peel Hunt LLP (Nominated Adviser and Joint + 44 (0) 20 7418
Broker) 8900
Dr Christopher Golden
James Steel
Liberum (Joint Broker)
Phil Walker + 44 (0) 20 3100
William Hall 2000
Consilium Strategic Communications
Mary-Jane Elliott +44 (0) 7780 600290
Jessica Hodgson
CSCSensynehealth@consilium-comms.com
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END
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