REG - Arecor Therapeutics - Proposed Acquisition of Tetris Pharma Ltd
01/08/2022 07:16
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RNS Number : 3952U Arecor Therapeutics PLC 01 August 2022
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1 August 2022
Arecor Therapeutics plc
("Arecor", the "Company" or the "Group")
Proposed Acquisition of Tetris Pharma Ltd to add key commercial diabetes
product and build out Arecor's specialty hospital products franchise with
scalable sales, marketing and distribution platform
Proposed Placing to Raise Approximately £6 million
Arecor Therapeutics plc (AIM: AREC), a globally focused
biopharmaceutical company advancing today's therapies to enable healthier
lives, announces that it has entered into a conditional agreement to acquire
the entire issued share capital of Tetris Pharma Ltd ("Tetris Pharma"). Tetris
Pharma is a commercial stage speciality pharmaceutical company with a sales
and distribution team and a platform focused on injectable speciality products
across the UK and Europe. The Directors believe that the acquisition adds a
key commercial diabetes product to Arecor's portfolio, as well as
complementing Arecor's existing specialty hospital products franchise,
offering the potential to accelerate significant revenue growth for Arecor.
Sarah Howell, CEO of Arecor Therapeutics commented:
"The Board of Arecor believe that the acquisition of Tetris Pharma is a
compelling opportunity to accelerate Arecor's commercially-driven strategy
alongside our core diabetes and partnered products businesses. We will gain an
existing, revenue-generating, sales, marketing and distribution platform which
we believe is highly complementary to our existing specialty hospitals
products business and has significant growth potential. The lead product,
Ogluo®, meets a key patient need for people living with diabetes at risk of
severe hypoglycaemia, which is a therapeutic area that we understand well,
giving us confidence in its prospects and our ability to deliver. In addition,
the platform would add future optionality to our specialty products franchise
by providing the capability to take selected products to market in the UK and
Europe where appropriate in addition to our already proven partnering
strategy."
Acquisition benefits
The Directors believe that the Acquisition offers the potential to
significantly accelerate Arecor's revenue growth. Tetris Pharma has an
exclusive supply agreement and licence to sell the first stable liquid
ready-to-use glucagon auto-injector pen, Ogluo®, within the EEA, UK and
Switzerland. Ogluo® is a proprietary ready-to-use glucagon indicated to treat
severe hypoglycaemia, a potentially life-threatening condition, in people with
diabetes. Tetris Pharma is targeting a significant market share within an
existing c.£100 million+ market across the licensed territory. Ogluo® was
launched by Tetris Pharma in the UK earlier this year and launches across key
European territories are planned over the next 12 to 24 months.
The Directors believe the Acquisition will help realise Arecor's vision of
becoming a significant self-sustaining biopharmaceutical business by
providing:
1) Addition of a key proprietary diabetes specialty product aligned to
Arecor's vision
• Transforming patient care by enhancing existing therapeutic
medicines so that they are safer, more effective and easier-to-use
• Ogluo® is an important and proprietary product, patent protected
until at least 2035, with real medical need
• Ogluo® is the first ready-to-use liquid stable glucagon for the
treatment of severe hypoglycaemia, a potentially life-threatening condition
that requires safe, fast and effective treatment
2) Strategic fit and the provision of partnership optionality across
Arecor's proprietary specialty hospital franchise
• The Tetris Pharma sales and distribution platform provides Arecor
with optionality on partnering structures to realise full value of Arecor's
proprietary specialty hospital products
• Future potential to take selected niche specialty hospital
products to market in the UK and Europe
4) Complementary team skills and expertise
• Opportunity to enhance specialty therapeutic knowledge across
product development and commercialisation life-cycle
• Enhance interactions with diabetes key opinion leaders, patient
groups and payers for the benefit of both Ogluo® and Arecor's lead
proprietary diabetes development products, AT247 and
AT278
5) Anticipated positive cashflow contribution from Tetris Pharma with
Tetris Pharma expected to break even within c. 3 years from completion of the
Acquisition
• Tetris Pharma generated initial revenues of c. £600,000
(unaudited) in the six months to 30 June 2022. The Directors believe that
there is potential for significant revenue growth as Ogluo® roll-out
progresses
• Expected future cash contribution to Arecor Therapeutics which can
be utilised to increase/accelerate value enhancing proprietary product
development
There is no change of strategy in relation to Arecor's lead diabetes products
AT247 and AT278, where Arecor intends to generate additional clinical data to
further demonstrate the superiority of these products compared with gold
standard insulins available to patients today, and to position these products
for partnering under Arecor's existing licensing model.
Transaction terms
Pursuant to the terms of the Acquisition, the Company has agreed to acquire
the entire issued share capital of Tetris Pharma for initial consideration
consisting of the issue of 651,726 new Ordinary Shares to the Tetris Pharma
Sellers. The Company has also agreed to discharge certain existing liabilities
of Tetris Pharma with an aggregate value of approximately £2.0 million, such
liabilities including, inter alia, the Inventory Payment and certain other
one-off liabilities (together the "Tetris Pharma Payments"). Deferred
consideration of up to £4.0 million in aggregate is payable to the Tetris
Pharma Sellers through three Earn Out Payments on the first, second and third
anniversaries of completion of the Acquisition subject to revenue and EBITDA
performance targets to be satisfied through the issue of either (i) new
Ordinary Shares or (ii) unsecured loan notes having an aggregate principal
value equal to the amount of the relevant Earn Out Payment, at Arecor's
election. The Initial Consideration Shares represent 2.3 per cent. of the
existing issued share capital of the Company and are subject to lock-in
arrangements. Further details on the rationale for, and the terms of, the
Acquisition are set out in the Additional Information section of this
Announcement.
To finance the Tetris Pharma Payments and to provide growth capital to
accelerate the roll-out of Ogluo® across the UK and Europe and to provide a
line of sight to break even for Tetris Pharma, the Company announces a
proposed Placing of approximately £6 million, before expenses, of new
Ordinary Shares at a Placing Price of 300 pence per new Ordinary Share.
The Acquisition is conditional, inter alia, on completion of the Placing.
The Placing Shares will be issued pursuant to the share authorities approved
at the Company's annual general meeting held on 23 May 2022.
The Placing Price represents a discount of approximately 3.2 per cent. to the
closing mid-market price of 310 pence per Existing Ordinary Share on 29 July
2022, being the latest practicable date prior to the publication of this
Announcement.
The Placing will be conducted by way of an accelerated book building process
(the "Bookbuild"), which will be launched immediately following this
Announcement in accordance with the terms and conditions set out in Appendix
II. The Placing Shares are not being made available to the public. It is
envisaged that the Bookbuild will be closed no later than 4.30 p.m. BST today,
1 August 2022. Details of the number of Placing Shares and the gross proceeds
of the Placing will be announced as soon as practicable after the closing of
the Bookbuild. The Placing is not underwritten.
Tetris Pharma highlights
· Tetris Pharma is a revenue-generating, commercial stage
pharmaceutical company established in April 2020 to develop a platform focused
on niche speciality pharma injectable products across the UK and Europe
targeting currently underserved patient needs. The business model is to
license rights to sell and distribute specialty products from pharmaceutical
companies by providing a platform to access the UK and European markets.
· Tetris Pharma's lead product - Ogluo® - is approved in the UK
and EEA for the treatment of severe hypoglycaemia in patients with Type 1 and
Type 2 diabetes, a serious emergency condition which left untreated may cause
seizure, coma and even death.
· Ogluo® is an important and proprietary product with real medical
need providing the first stable liquid ready-to-use glucagon in an easy-to-use
auto-injector pen as an emergency treatment for severe hypoglycaemia. With
Arecor's deep understanding of the diabetes market, the Directors believe the
simple two step administration of Ogluo® offers a strong patient benefit and
competitive advantage over the standard of care and, as such, has the
potential to capture significant share within a c.£100 million+ market across
Europe and the UK.
· Tetris Pharma has, conditional on, inter alia, completion of the
Acquisition, entered into an amended exclusive 16-year minimum term licence
and supply agreement with Xeris Pharmaceuticals, Inc. ("Xeris") for the sale
and distribution of Ogluo® in the EEA, UK and Switzerland. Ogluo® is sold by
Xeris under the registered name Gvoke® in the US.
· Since launch in Q4 2019, Gvoke® has demonstrated a
quarter-on--quarter growth in the number of prescriptions in the US, with c.
88 per cent. growth from Q1 2021 to Q1 2022, demonstrating patient and
prescriber demand for this product which is also expected to translate to the
UK and European markets.
· Ogluo® was made available in the UK in December 2021.
· Total sales by Tetris Pharma (unaudited) in the six months to 30
June 2022 were c.£600,000.
The Acquisition is conditional upon Admission of the Initial Consideration
Shares and the Placing Shares.
Fundraising highlights
· Placing to raise approximately £6 million, before expenses,
through the issue of new Ordinary Shares at the Placing Price.
· It is expected that certain Directors of the Company will
subscribe for new Ordinary Shares as part of the Placing on the same terms as
other Placees for an aggregate amount of at least £100,000.
· c.£2.6 million of the Placing is EIS and VCT eligible.
· The Placing Price represents a discount of approximately 3.2 per
cent. to the closing mid-market price of 310 pence per Existing Ordinary Share
on 29 July 2022, being the latest practicable date prior to the publication of
this Announcement.
· The net proceeds of the Placing will be used to fund, inter
alia, the Tetris Pharma Payments and provide working capital to Tetris Pharma
following completion.
The Placing is conditional on, inter alia, EIS/VCT Admission, General
Admission and the Placing Agreement having become unconditional in all
respects save for Admission and the Xeris Licence Amendment and the SPA having
been duly executed by all parties thereto. The EIS/VCT Placing Shares will be
issued unconditionally on the EIS/VCT Admission prior to completion of the
Acquisition and prior to General Admission. The placing of the General
Placing Shares is conditional upon completion of the Acquisition. The General
Placing Shares will be issued unconditionally on the General Admission along
with the issue of the Initial Consideration Shares such that the Acquisition
and the Placing complete simultaneously.
The EIS/VCT Placing is not conditional on completion of the Acquisition, the
issue of the General Placing Shares or General Admission. Investors should
note that it is possible that EIS/VCT Admission will occur, but the
Acquisition and General Admission will not occur.
The expected timetable of principal events is set out in Appendix I to this
Announcement. The Placing is subject to the terms and conditions set out in
Appendix II to this Announcement. Capitalised terms have the meaning set out
in Appendix III to this Announcement.
For more information, please contact:
Arecor Therapeutics plc www.arecor.com (http://www.arecor.com)
Dr Sarah Howell, Chief Executive Officer Tel: +44 (0) 1223 426060
Email: info@arecor.com (mailto:info@arecor.com)
Susan Lowther, Chief Financial Officer Tel: +44 (0) 1223 426060
Email: info@arecor.com (mailto:info@arecor.com)
Mo Noonan, Communications Tel: +44 (0) 7876 444977
Email: mo.noonan@arecor.com (mailto:mo.noonan@arecor.com)
Panmure Gordon (UK) Limited (NOMAD and Broker)
Freddy Crossley, Emma Earl (Corporate Finance) Tel: +44 (0) 20 7886 2500
Rupert Dearden (Corporate Broking)
Consilium Strategic Communications
Chris Gardner, David Daley, Angela Gray Tel: +44 (0) 20 3709 5700
Email: arecor@consilium-comms.com (mailto:arecor@consilium-comms.com)
Notes to Editors
About Arecor
Arecor Therapeutics plc is a globally focused biopharmaceutical group
transforming patient care by bringing innovative medicines to market through
the enhancement of existing therapeutic products. By applying our innovative
proprietary formulation technology platform, Arestat™, we are developing an
internal portfolio of proprietary products in diabetes and other indications,
as well as working with leading pharmaceutical and biotechnology companies to
deliver enhanced formulations of their therapeutic products. The Arestat™
platform is supported by an extensive patent portfolio.
For further details please see our website, www.arecor.com
(http://www.arecor.com)
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Additional Information
Introduction
Arecor Therapeutics plc is a globally focused biopharmaceutical company
transforming patient care by enhancing existing therapeutic medicines so that
they are safer, more effective and easier to use. By applying the Group's
innovative proprietary formulation technology platform, Arestat™, the Group
is developing a portfolio of proprietary products, as well as working with
pharmaceutical and biotechnology companies to deliver enhanced reformulations
of their partners' therapeutic products, supported by an extensive patent
portfolio.
Arecor's proprietary product portfolio covers two areas of products focused on
diabetes and specialty hospital care. This is alongside the development of
novel enhanced formulations of partner products that include biosimilars,
biological products and vaccines which are derived from the Group's
formulation development and technology licensing programmes.
Arecor's shares were admitted to trading on AIM in June 2021 and, since then,
Arecor has generated best-in-class clinical data for AT278, initiated an
insulin pump clinical study to further demonstrate superiority of AT247 and
expanded its revenue-generating technology partnerships.
Upon completion of the Acquisition, Arecor will operate in three complementary
areas underpinned by its expertise in enhancing existing therapeutic medicines
so they are safer, more effective and easy-to-use:
· Arecor's proprietary diabetes franchise including AT278, an
ultra-rapid acting, ultra-concentrated (500U/mL) insulin product candidate,
and AT247, an ultra-rapid acting insulin (100U/mL) product candidate.
Excellent clinical progress has continued to-date, and the Group is on track
to report headline data from its ongoing US 3-day insulin pump clinical study
of AT247 later this year and also within the year to start dosing patients in
a further clinical trial of AT278 in people with living with type 2 diabetes.
· Technology partnerships and licensing, which include its recently
announced exclusive formulation study collaboration with a top five global
pharma company, following five collaboration agreements entered into during
2021, all of which are revenue-generating and the potential for significant
upside potential from licensing. The pipeline for further revenue-generating
partnered collaborations is strong with further deals anticipated. In
addition, Arecor has entered into two licensing agreements where the
Arestat(TM) technology has been incorporated into our partners products, AT220
(undisclosed biosimilar) and AT292 (INHBRX-101, Inhibrx), with both products
continuing progress through development, offering upside revenue potential
from development milestones and commercial payment terms under the licences.
· Arecor's specialty hospital products franchise which will include
the Tetris Pharma portfolio and Arecor's in-house development pipeline of
specialty hospital products. Where the focus is to develop ready-to-use and
ready-to-administer versions of existing therapeutic products that have the
potential to enable fast, safer and effective treatment options for patients.
Arecor has licensed two of its specialty hospital products to Hikma
Pharmaceuticals under co-development and licensing agreements.
The Directors believe that the pipeline for future revenue-generating
partnered collaborations is strong with further deals anticipated in H2 and
beyond.
Information on Tetris Pharma
Tetris Pharma is a UK and Netherlands based specialty pharmaceutical company
with a marketing and distribution platform across the UK and European markets
with a core focus on niche injectable and hospital-based prescription products
in areas of unmet medical need. Tetris Pharma has an initial portfolio
comprising nine license and distribution agreements, in addition to Ogluo®,
which have been put in place to establish the platform and make a positive
contribution to cashflow. Its lead product, Ogluo®, is a novel stable liquid
formulation of glucagon delivered through an easy-to-use auto-injector pen for
the management of severe hypoglycaemia in patients with diabetes. Whilst the
existing market opportunity is estimated to be £100 million across the UK and
Europe based on actual 2021 unit sales of glucagon across the territory (1.65m
units) multiplied by the premium pricing achieved for ready-to-use glucagon,
the total potential addressable market opportunity for Ogluo® is estimated to
be worth in the region of $1 billion across the UK and Europe if all patients
with diabetes who take insulin were prescribed premium priced ready-to-use
glucagon (2 units of glucagon per prescription).
Tetris Pharma's strategy is to license rights to branded medicines and niche
injectables products to market with a focus on superior versions of products
which have been available for some time but have been repurposed with a new
indication, presentation, or formulation. Tetris Pharma requires minimal
expenditure on research and development and the Directors believe has a
de-risked commercialisation strategy. Tetris Pharma has an experienced team
and leadership with a track record of sales, marketing and distribution of
specialty products across the UK and Europe and also leverages Contract sales
organisations, which can be flexed up and down and hence represents a capital
efficient model.
Lead product - Ogluo®
Ogluo® is the only ready-to-use liquid glucagon available in the UK for the
treatment of severe hypoglycaemia and is indicated for the treatment of severe
hypoglycaemia in adults, adolescents, and children aged 2 years and over with
diabetes mellitus. Ogluo® is administered via a simple two-step process
offering a safe, fast and effective treatment of severe hypoglycaemia in this
emergency situation. The pre-mixed, pre-filled auto-injector pen provides an
easy, two step administration of a 1.0 mg (adult and paediatric) or 0.5 mg
(paediatric) dose of glucagon. The current standard of care in the UK is a
lyophilised glucagon emergency kit which in comparison requires a complex
eight-step administration. Ogluo® also has a shelf life of at least two years
and no requirement for cold storage. Tetris Pharma has achieved a
reimbursement premium price for the auto-injector pen in the UK of £73 per
single-dose
Severe hypoglycaemia is a serious condition with people with Type 1 diabetes,
who have on average 1.15 severe hypoglycaemic events per year and people with
Type 2 diabetes on insulin, who have on average 0.35 events per year. In
people with Type 1 diabetes, 4-10% of deaths are attributed to hypoglycaemia.
Any person with diabetes who is using insulin would be clinically appropriate
for a prescription of glucagon. In the Ogluo® Tetris Pharma licensed
territory of the EEA, UK and Switzerland there are approximately 5 million
Type 1 and Type 2 insulin treated diabetics. This leads to a total potential
market opportunity in the licensed territory of approximately $1 billion if
all of this 5 million clinically relevant patient population were prescribed
two units of ready-to-use glucagon at an average price of $100/unit
(€85/unit at 1:1.20 forex). However, not all clinically relevant patients
take a prescription for glucagon, and hence, the current market opportunity in
the licensed territory is c.£100 million as outlined above, with market
growth opportunity with increased number of prescriptions.
The Directors believe that Ogluo® is well placed to take significant market
share on the basis of its benefits for fast, safe and effective administration
of glucagon via a simple to use auto-injector pen and the commercial launch of
the equivalent product, Gvoke® in the US by Xeris alongside being the first
ready-to-use liquid glucagon product approved for use in the EEA and the UK.
Ogluo® has been exclusively licensed by Tetris Pharma from Nasdaq-listed
Xeris within the licensed territory of the EEA, UK and Switzerland. Ogluo® is
marketed by Xeris under the brand Gvoke® in the US. Ogluo® was made
available by Tetris Pharma in the UK in December 2021 and active sales began
in the UK in March 2022, albeit with a limited sales and marketing budget. The
Directors believe there will be strong demand for Ogluo® and a significant
opportunity to grow revenues as the roll-out across the UK and Europe
progresses.
Xeris was granted FDA approval for Gvoke® in the US in September 2019.
Gvoke® has grown its market share of the US glucagon rescue market from 6.4
per cent. in June 2020 to 22.8 per cent. in May 2022 having seen steady growth
despite the impact of COVID-19.
During the year ended 31 December 2021, Tetris Pharma generated unaudited
revenue of £0.3 million and a loss after tax of £0.8 million. Its unaudited
financials for the 6 months to 30 June 2022 showed sales of £0.6 million with
a loss after tax of £1.7 million (including one-off non-recurring costs of
c.£0.5 million). Tetris Pharma comprises a team of ten people with eight in
the UK and two in the Netherlands, who are expected to remain an important
part of Tetris Pharma following the Acquisition. To the end of June 2022,
Tetris Pharma has sold 1,729 units of Ogluo® in the UK.
In the UK, acceleration is expected to be achieved through a combination of
increased contract sales organisation activity to drive the switch to Ogluo®
as well as gaining formulary approval for Ogluo®, with a focus on the large
patient centres within the UK. There will be a phased launch across Europe,
prioritizing key high value/high price countries initial, such as Germany, the
Netherland and key Nordic territories. Contract sales organization activity
will also be increased on a country-by-country basis to drive sales.
Following completion of the Acquisition, the Group will accelerate the rollout
of Ogluo® across the UK and into Europe with target launches across key
European territories over the next 12 to 24 months targeting centres around
diabetologists, endocrinologists with interest in diabetes, diabetes nurse
specialists and formulary/specialist pharmacists.
Background and reasons for, the Acquisition and the Placing
Arecor's strategy is to build a leading portfolio of proprietary therapeutic
medicines by applying the Company's innovative formulation technology platform
Arestat™ alongside technology partnership focused on two primary target
areas: diabetes and specialty hospital care. The Board considers Tetris Pharma
to be a clear strategic fit with Arecor and believes the Acquisition will
provide a number of commercial, operational and financial benefits, which are
expected to create future value for Shareholders. In particular, the Directors
believe that the Acquisition offers the potential to accelerate significant
revenue growth for Arecor.
The Acquisition builds on Arecor's existing specialty hospital products
franchise, bringing a scalable sales, marketing and distribution platform for
ready-to-use specialty products in Europe. Tetris Pharma's experienced
leadership team has a track record in product launches and commercialisation
across the UK and EU. In addition to the potential revenue growth from
Ogluo®, Tetris Pharma's commercial platform brings Arecor access to a
commercial infrastructure for niche products. This will allow Arecor greater
future optionality of deal structure to fully realise the value of its own
proprietary products and the potential to take selected proprietary and
partnered products to the market in the UK and Europe. The Directors also
believe that the Acquisition will:
· Build out Arecor's specialty product franchise and add a key
proprietary diabetes specialty product with Ogluo®.
· Create future potential to take select niche specialty hospital
products to market in the UK and Europe.
· Provide an anticipated positive cashflow contribution to Arecor
which can be utilised to accelerate value enhancing proprietary product
development.
· Provide complementary skills and expertise from the Tetris Pharma
team, broadening the Group's specialty therapeutic knowledge.
· Enhance interactions with diabetes key opinion leaders, patient
groups and payers.
The proceeds of the Placing are expected to facilitate the future growth of
Tetris Pharma. The Board believes that having the right to sell Ogluo® has
the potential to add a significant revenue stream to the business and expects
significant year-on-year growth and gross margins for Tetris Pharma to be in
the region of between 24 per cent. and 37 per cent. per year. The Directors
estimate that based on current cost run-rates, Tetris Pharma has the potential
to reach break-even during or before 2024 in the event that Tetris Pharma
annual sales reach between £7 million to £8 million, with the potential to
reach peak sales (assuming c.30 per cent. market penetration) within three to
four years of Completion. These numbers are illustrative only and do not
represent a forecast for the Tetris Pharma business or the Group.
Details of the Acquisition and SPA
On 1 August 2022, the Company entered into a conditional share purchase
agreement (the "SPA") pursuant to which the Company agreed to purchase the
entire issued share capital of Tetris Pharma for consideration payable upon
Completion comprising the issue of 651,726 Initial Consideration
Shares (credited as fully paid), representing approximately 2.3 per cent. of
the existing issued share capital of Arecor.
The Company has also agreed to discharge certain existing liabilities of
Tetris Pharma with an aggregate value of approximately £2.0 million, such
liabilities including, inter alia, the Inventory Payment and certain other
one-off liabilities.
Up to a further £4.0 million deferred consideration may become payable,
consisting of three Earn Out Payments of:
a. £1.0 million on the first anniversary following Completion, subject to
Tetris Pharma achieving mid-single-digit million-pound net sales and a low
single-digit million-pound EBITDA loss in the 12-month period following
Completion;
b. £1.5 million on the second anniversary following Completion, subject
to Tetris Pharma achieving high-teens million-pound net sales and a small
positive EBITDA profit in the 12-month period following the first anniversary
of Completion; and
c. £1.5 million on the third anniversary following Completion, subject to
Tetris Pharma achieving double-digit million-pound net sales and single-digit
million-pound EBITDA profit in the 12-month period following the second
anniversary of Completion.
The Earn Out Payments are payable through the issue of either (i) new Ordinary
Shares or (ii) unsecured loan notes having an aggregate principal value equal
to the amount of the relevant Earn Out Payment, at the Company's election. Any
Earn Out Payments satisfied through the issue of new Ordinary Shares will be
issued at a price equal to the greater of £4.05 per share and the 30-day
volume weighted average price of the Ordinary Shares immediately preceding the
date such Earn Out Payment is determined.
The Initial Consideration Shares will, following Admission, rank in all
respects pari passu with the Existing Ordinary Shares. The Initial
Consideration Shares will be issued fully paid and free from all encumbrances
and with the rights set out in its articles of association.
Completion of the Acquisition is conditional upon the Admission of the Initial
Consideration Shares and the Placing Shares.
If this condition is not satisfied by 6 August 2022, the SPA shall be
terminated unless the parties otherwise agree. The SPA contains certain
customary warranties given by certain of the Tetris Pharma Sellers in relation
to Tetris Pharma and its business, subject to agreed limitations.
Xeris Licence Agreement
Ogluo® is the UK/EU tradename for the US product Gvoke® which was licenced
by Tetris Pharma from Xeris.
The exclusive licence and supply agreement with Xeris allows for sales of
Gvoke® under the trade name Ogluo® in the EEA, UK and Switzerland. On 15
July 2022, Tetris Pharma amended a 16-year licence agreement with Xeric and
Strongbridge Dublin Limited (the "Xeris Licence Amendment"). Pursuant to the
licence, a mid-single-digit royalty on net sales is payable to Xeris over the
licence period. In addition, further one-off commercial milestone payments are
payable to Xeris in the event that net revenues exceed pre-defined targets in
any single calendar year. The first of these triggers is if net revenues from
Ogluo® exceed mid double-digit millions in a calendar year. The Xeris Licence
Amendment also contains customary terms and conditions, including certain
performance conditions by Tetris Pharma which, if not met, provide Xeris with
a right of termination.
The Xeris Licence Amendment shall only become effective if completion of the
Acquisition has occurred and the Inventory Payment has been made, in each case
on or prior to 12 August 2022. If by 12 August 2022 both of these conditions
have not been met then the Xeris Licence Amendment shall terminate and cease
to have any effect.
Lock-in Agreements
Each of the Tetris Pharma Sellers has, pursuant to lock-in obligations in the
SPA, undertaken to the Company and Panmure Gordon not to dispose of any
interests in their respective Initial Consideration Shares (or Deferred
Consideration Shares, if applicable, in respect of the Earn Out) for 24 months
following Admission and thereafter, for the subsequent 12-month period, any
disposals of interests in their respective Initial Consideration Shares (or
Deferred Consideration Shares) are subject to an orderly dealing requirement.
The lock-in obligations contain customary exceptions on disposal of the
Initial Consideration Shares including, inter alia, a transfer pursuant to
acceptance of a takeover offer and a transfer to a family member.
Details of the Placing
Panmure Gordon is acting as nominated adviser, broker and placing agent in
connection with the Placing. Under the terms of the Placing, Panmure Gordon
has agreed to use reasonable endeavours to place the Placing Shares at the
Placing Price to raise approximately £6 million.
The Placing is expected to comprise the placing of EIS/VCT Placing Shares and
the placing of General Placing Shares.
The EIS/VCT Placing is conditional, inter alia, upon:
· the Company allotting, subject only to EIS/VCT Admission, the
EIS/VCT Placing Shares in accordance with the Placing Agreement;
· EIS/VCT Admission taking place not later than 8.00 a.m. on 3
August 2022 (or such later date as may be agreed in writing between the
Company and Panmure Gordon);
· the SPA:
o having been duly executed by all parties thereto; and
o not having lapsed or been terminated prior to EIS/VCT Admission pursuant
to the terms thereof;
· the Xeris Licence Amendment:
o having been duly executed by all parties thereto; and
o not having lapsed or been terminated prior to EIS/VCT Admission pursuant
to the terms thereof; and
· the Company having complied with its obligations under the
Placing Agreement.
If any of the conditions above are not satisfied or waived, the EIS/VCT
Placing Shares will not be issued. The EIS/VCT Placing is not conditional upon
completion of the Acquisition. The Acquisition is expected to complete
following the General Admission.
The General Placing is conditional, inter alia, upon:
· EIS/VCT Admission having occurred and the Company allotting,
subject only to General Admission, the General Placing Shares in accordance
with the Placing Agreement and the Initial Consideration Shares in accordance
with the SPA;
· General Admission taking place not later than 8.00 a.m. on 4
August 2022 (or such later date as may be agreed in writing between the
Company and Panmure Gordon);
· the SPA:
o having been duly executed by all parties thereto;
o not having lapsed or been terminated prior to General Admission pursuant
to the terms thereof; and
o having become unconditional in all respects in accordance with its terms,
subject only to General Admission and the issue by the Company of the Initial
Consideration Shares to the Tetris Pharma Sellers.
· the Xeris Licence Amendment:
o having been duly executed by all parties thereto;
o not having lapsed or been terminated prior to General Admission pursuant
to the terms thereof;
o having become unconditional in all respects in accordance with its terms,
subject only to the Inventory Payment payable thereunder and completion of the
Acquisition; and
o the Company having complied with its obligations under the Placing
Agreement.
If any of the conditions above are not satisfied, the General Placing Shares
will not be issued. The EIS/VCT Placing is not conditional on the issue of the
General Placing Shares and the General Admission.
It is expected that certain Directors of the Company will subscribe for new
Ordinary Shares as part of the Placing on the same terms as other Placees for
an aggregate amount of at least £100,000. Further details will be announced
as appropriate in due course.
The proceeds from the Placing, will be used to fund, inter alia:
· the payment to Tetris Pharma of c.£2.0 million for initial
Ogluo® inventory from Xeris and historic one-off liabilities of Tetris
Pharma;
· provide c.£4 million of working capital to Tetris Pharma to
accelerate the roll-out of Ogluo® across the UK and Europe and to provide a
line of sight to Tetris Pharma break-even.
The Placing is not underwritten.
The Placing Shares will be issued free of all liens, charges and encumbrances
and will, when issued and fully paid, rank pari passu in all respects with the
Existing Ordinary Shares, including the right to receive all dividends and
other distributions declared, made or paid after the date of their issue.
Application will be made to the London Stock Exchange for the admission of the
Placing Shares and the Initial Consideration Shares to trading on AIM. The
Placing Shares and the Initial Consideration Shares will be issued pursuant to
the existing authorities approved at the Company's annual general meeting held
on 23 May 2022. It is expected that: (i) EIS/VCT Admission will occur, and
that dealings in the EIS/VCT Placing Shares subscribed for pursuant to the
EIS/VCT Placing will commence, at 8.00 a.m. on 3 August 2022, at which time it
is also expected that the EIS/VCT Placing Shares subscribed for pursuant to
the EIS/VCT Placing will be enabled for settlement in CREST; and (ii) General
Admission will occur, and that dealings in the Non-EIS/VCT Placing Shares and
the Initial Consideration Shares will commence, at 8.00 a.m. on 4 August 2022,
at which time it is also expected that the General Placing Shares and the
Initial Consideration Shares will be enabled for settlement in CREST.
Panmure Gordon (whether itself or through its affiliates) is arranging the
Placing as placing agent of the Company for the purpose of using reasonable
endeavours to procure Placees at the Placing Price for the Placing Shares.
Panmure Gordon intends to conditionally place the Placing Shares with certain
institutional and other investors.
The Placing Agreement contains customary warranties given by the Company to
Panmure Gordon as to matters relating to the Company and its business and a
customary indemnity given by the Company to Panmure Gordon in respect of
liabilities arising out of, or in connection with, the Placing.
Panmure Gordon (after consultation with the Company) reserves the right to
scale back the number of Placing Shares to be subscribed by any Placee in the
event of applications in excess of the target amount under the Placing. The
Company and Panmure Gordon also reserve the right not to accept offers to
subscribe for Placing Shares or to accept such offer in part rather than in
whole. Panmure Gordon shall be entitled to effect the Placing by such method
as they shall in their sole discretion determine. To the fullest extent
permissible by law, neither Panmure Gordon nor any holding company of Panmure
Gordon nor any subsidiary branch or affiliate of Panmure Gordon (each an
affiliate) nor any person acting on behalf of any of the foregoing shall have
any liability to the Placees (or to any other person whether acting on behalf
of a Placee or otherwise). In particular, neither Panmure Gordon, nor any
affiliate thereof nor any person acting on their behalf shall have any
liability to Placees in respect of their conduct of the Placing.
APPENDIX I
Expected Timetable for the Fundraising
2022
Announcement of the results of the Placing 1 August
EIS/VCT Placing Shares credited to CREST stock accounts 3 August
EIS/VCT Admission effective and commencement of dealings in the EIS/VCT 8:00 a.m. on 3 August
Placing Shares on AIM commence
General Admission effective and commencement of dealings in the General 8:00 a.m. on 4 August
Placing Shares and the Initial Consideration Shares on AIM
General Placing Shares credited to CREST stock accounts 4 August
Despatch of definitive share certificates in respect of New Ordinary Shares to within 14 working days
be issued in certificated form
Long Stop Date 5:00 p.m. on 15 August
Notes:
(i) References to times in this Announcement are to London time (unless
otherwise stated).
(ii) If any of the above times or dates should change, the revised times
and/or dates will be notified by an announcement to an RIS.
(iii) The timing of the events in the above timetable is indicative only.
APPENDIX II
TERMS AND CONDITIONS OF THE PLACING
INTRODUCTION
IMPORTANT INFORMATION FOR INVITED PLACEES ONLY REGARDING THE PLACING.
THIS ANNOUNCEMENT, INCLUDING THIS APPENDIX, AND THE INFORMATION IN IT, IS
RESTRICTED, AND IS NOT FOR PUBLICATION, RELEASE OR DISTRIBUTION, DIRECTLY OR
INDIRECTLY, IN WHOLE OR IN PART TO U.S. PERSONS OR, IN OR INTO THE UNITED
STATES, ANY OF THE OTHER RESTRICTED JURISDICTIONS OR ANY OTHER JURISDICTION IN
WHICH SUCH PUBLICATION OR DISTRIBUTION WOULD BE UNLAWFUL.
THE PLACING SHARES THAT ARE THE SUBJECT OF THE PLACING ARE NOT BEING OFFERED
OR SOLD TO ANY PERSON IN THE EUROPEAN UNION OR THE UK, OTHER THAN TO QUALIFIED
INVESTORS, WHICH INCLUDES LEGAL ENTITIES WHICH ARE REGULATED BY THE FCA OR
ENTITIES WHICH ARE NOT SO REGULATED WHOSE CORPORATE PURPOSE IS SOLELY TO
INVEST IN SECURITIES.
MEMBERS OF THE PUBLIC IN THE UK OR ELSEWHERE ARE NOT ELIGIBLE TO TAKE PART IN
THE PLACING. THIS ANNOUNCEMENT (INCLUDING THIS APPENDIX) AND THE TERMS AND
CONDITIONS SET OUT HEREIN ARE FOR INFORMATION PURPOSES ONLY AND ARE DIRECTED
ONLY AT: (A) QUALIFIED INVESTORS; (B) IN THE UNITED KINGDOM, QUALIFIED
INVESTORS WHO ARE PERSONS WHO (I) FALL WITHIN ARTICLE 19(5) OF THE ORDER, FALL
WITHIN ARTICLE 49(2)(A) TO (D) OF THE ORDER OR ARE PERSONS TO WHOM IT MAY
OTHERWISE BE LAWFULLY COMMUNICATED AND (II) ARE A "PROFESSIONAL CLIENT" OR AN
"ELIGIBLE COUNTERPARTY" WITHIN THE MEANING OF CHAPTER 3 OF THE FCA'S CONDUCT
OF BUSINESS SOURCEBOOK; OR (C) OTHER PERSONS TO WHOM IT MAY LAWFULLY BE
COMMUNICATED (ALL SUCH PERSONS TOGETHER BEING REFERRED TO AS "RELEVANT
PERSONS"). THIS ANNOUNCEMENT (INCLUDING THIS APPENDIX) AND THE TERMS AND
CONDITIONS SET OUT HEREIN MUST NOT BE ACTED ON OR RELIED ON BY PERSONS WHO ARE
NOT RELEVANT PERSONS. ANY INVESTMENT OR INVESTMENT ACTIVITY TO WHICH THIS
ANNOUNCEMENT (INCLUDING THIS APPENDIX) AND THE TERMS AND CONDITIONS SET OUT
HEREIN RELATES IS AVAILABLE ONLY TO RELEVANT PERSONS AND WILL BE ENGAGED IN
ONLY WITH RELEVANT PERSONS.
THIS APPENDIX, AND THE ANNOUNCEMENT OF WHICH IT FORMS PART, IS FOR INFORMATION
PURPOSES ONLY AND DOES NOT ITSELF CONSTITUTE AN OFFER FOR SALE OR SUBSCRIPTION
OF ANY SECURITIES IN THE COMPANY. IF YOU ARE IN ANY DOUBT AS TO WHETHER YOU
ARE A RELEVANT PERSON YOU SHOULD CONSULT A PROFESSIONAL ADVISER FOR ADVICE.
THIS ANNOUNCEMENT, INCLUDING THIS APPENDIX, IS NOT AN OFFER FOR SALE OR
SUBSCRIPTION IN ANY JURISDICTION IN WHICH SUCH OFFER, SOLICITATION OR SALE
WOULD BE UNLAWFUL UNDER THE SECURITIES LAWS OF ANY SUCH JURISDICTION. THIS
ANNOUNCEMENT, INCLUDING THIS APPENDIX, IS NOT AN OFFER OF OR SOLICITATION TO
PURCHASE OR SUBSCRIBE FOR SECURITIES IN THE UNITED STATES.
EACH PLACEE SHOULD CONSULT WITH ITS OWN ADVISERS AS TO LEGAL, TAX, BUSINESS
AND RELATED ASPECTS OF AN INVESTMENT IN PLACING SHARES. THE PRICE OF THE
PLACING SHARES IN THE COMPANY AND THE INCOME FROM THEM (IF ANY) MAY GO DOWN AS
WELL AS UP AND INVESTORS MAY NOT GET BACK THE FULL AMOUNT INVESTED ON DISPOSAL
OF THE PLACING SHARES.
Placees will be deemed to have read and understood this Announcement and these
terms and conditions in their entirety and to be making such offer on the
terms and conditions and to be providing the representations, warranties,
acknowledgements, and undertakings contained in this Appendix. In particular,
each such Placee represents, warrants and acknowledges that:
1. it is a Relevant Person and undertakes that it will acquire, hold,
manage or dispose of any Placing Shares that are allocated to it for the
purposes of its business;
2. in the case of any Placing Shares acquired by it as a financial
intermediary, as that term is used in Article 5(1) of the Prospectus
Regulation, (i) the Placing Shares acquired by it have not been acquired on
behalf of, nor have they been acquired with a view to their offer or resale
to, persons in any Member State of the EEA or the UK other than Qualified
Investors or in circumstances in which the prior consent of Panmure Gordon has
been given to the offer or resale; or (ii) where Placing Shares have been
acquired by it on behalf of persons in any Member State of the EEA or the UK
other than Qualified Investors, the offer of those Placing Shares to it is not
treated under the Prospectus Regulation as having been made to such persons;
and/or
3. (i) (1) it is not a U.S. Person, (2) it is not located in the United
States, and (3) it is not acquiring the Placing Shares for the account or
benefit of a U.S. Person; or (ii) it is a dealer or other professional
fiduciary in the United States acting for a discretionary account (other than
an estate or trust) held for the benefit or account of a non U.S. Person in
reliance on Regulation S.
The Company and Panmure Gordon will rely upon the truth and accuracy of the
foregoing representations, acknowledgements and agreements. Panmure Gordon
does not make any representation to any Placee regarding an investment in the
Placing Shares referred to in this Announcement (including this Appendix).
This Announcement (including this Appendix) does not constitute an offer, and
may not be used in connection with an offer, to sell or issue or the
solicitation of an offer to buy or subscribe for Placing Shares in any
jurisdiction in which such offer or solicitation is or may be unlawful. This
Announcement (including this Appendix) and the information contained herein is
not for publication or distribution, directly or indirectly, to persons in the
United States, any of the other Restricted Jurisdictions or in any
jurisdiction in which such publication or distribution is unlawful. Persons
who come into possession of this Announcement are required by the Company to
inform themselves about and to observe any restrictions of transfer of this
Announcement. No public offer of securities of the Company under the Placing
is being made in the United Kingdom, the United States or any Restricted
Jurisdiction.
In particular, the Placing Shares referred to in this Announcement have not
been and will not be registered under the Securities Act or under any laws of,
or with any securities regulatory authority of, any state or other
jurisdiction of the United States, and may not be offered, sold, resold,
transferred or delivered, directly or indirectly, in the United States or to,
or for the account or benefit of, U.S. Persons, except pursuant to an
exemption from, or in a transaction not subject to, the registration
requirements of the Securities Act and in compliance with any applicable
securities laws of any state or other jurisdiction in the United States, and
under circumstances that would not result in the Company being required to
register under the U.S. Investment Company Act of 1940. The Placing Shares are
only being offered and sold outside the United States in offshore transactions
to persons who are not U.S. Persons in accordance with Regulation S under the
Securities Act.
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; 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 any
of the Restricted Jurisdictions. 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 the
Restricted Jurisdictions 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 Appendix or
the Announcement of which it forms part should seek appropriate advice before
taking any action.
DETAILS OF THE PLACING
Panmure Gordon having entered into the Placing Agreement with the Company
under which Panmure Gordon has, on the terms and subject to the conditions set
out therein, undertaken to use its reasonable endeavours to procure, as agents
for the Company, subscribers for the Placing Shares at the Placing Price.
The Placing Agreement contains customary warranties given by the Company to
Panmure Gordon as to matters relating to the Company and its business and a
customary indemnity given by the Company to Panmure Gordon in respect of
liabilities arising out of, or in connection with, the Placing.
Panmure Gordon (after consultation with the Company) reserves the right to
scale back the number of Placing Shares to be subscribed by any Placee in the
event of applications in excess of the target amount under the Placing. The
Company and Panmure Gordon also reserves the right not to accept offers to
subscribe for Placing Shares or to accept such offer in part rather than in
whole. Panmure Gordon shall be entitled to effect the Placing by such method
as it shall in its sole discretion determine. To the fullest extent
permissible by law, neither Panmure Gordon nor any holding company of Panmure
Gordon nor any subsidiary branch or affiliate of Panmure Gordon (each an
affiliate) nor any person acting on behalf of any of the foregoing shall have
any liability to the Placees (or to any other person whether acting on behalf
of a Placee or otherwise). In particular, neither Panmure Gordon, nor any
affiliate thereof nor any person acting on their behalf shall have any
liability to Placees in respect of their conduct of the Placing.
Each Placee's obligations will be owed to the Company and to Panmure Gordon.
Following the confirmation referred to below in the paragraph entitled
"Participation in, and principal terms of, the Placing", each Placee will also
have an immediate, separate, irrevocable and binding obligation, owed to
Panmure Gordon, to pay to Panmure Gordon (or as Panmure Gordon may direct) in
cleared funds an amount equal to the product of the Placing Price and the
number of Placing Shares which such Placees has agreed to acquire.
Each Placee agrees to indemnify on demand and hold each of Panmure Gordon and
the Company, and their respective affiliates harmless from any all costs,
claims, liabilities and expenses (including legal fees and expenses) arising
out of or in connection with any breach of the acknowledgments, undertakings,
representations, warranties and agreements set forth in these terms and
conditions.
The Placing is also conditional upon the Placing Agreement becoming
unconditional and the Placing Agreement not being terminated in accordance
with its terms. Further details of conditions in relation to the Placing are
set out below in the paragraph entitled "Conditions of the Placing".
A Placee agrees to become a member of the Company and agrees to subscribe for
those Placing Shares allocated to it by Panmure Gordon at the Placing Price,
conditional on: (i) in respect of the EIS/VCT Placing Shares, EIS/VCT
Admission occurring and becoming effective by 8.00 a.m. on 3 August 2022 and,
in the case of the in respect of the General Placing Shares, General Admission
occurring and becoming effective by 8.00 a.m. on 4 August 2022 (or, in either
such case, such later time and/or date, not being later than 8.00 a.m. on 4
August 2022, as the Company and Panmure Gordon may agree); (ii) the Placing
Agreement becoming otherwise unconditional in all relevant respects and not
having been terminated in accordance with its terms on or before the date of
the relevant Admission; and (iii) Panmure Gordon confirming to the Placees
their allocation of Placing Shares.
To the fullest extent permitted by law, each Placee acknowledges and agrees
that it will not be entitled to exercise any remedy of rescission at any time.
This does not affect any other rights the Placee may have.
The EIS/VCT Placing is not conditional on the issue of the General Placing
Shares and General Admission. Investors should note that it is possible that
EIS/VCT Admission will occur but General Admission will not occur.
The Placing Shares will, when issued, be subject to the articles of
association of the Company, be credited as fully paid and rank pari passu in
all respects with the existing Ordinary Shares in issue, including the right
to receive all dividends and other distributions (if any) declared, made or
paid on or in respect of Ordinary Shares after the date of issue of the
Placing Shares.
APPLICATION FOR ADMISSION TO TRADING
Application will be made to the London Stock Exchange for Admission. It is
expected that settlement of the EIS/VCT Placing Shares and EIS/VCT Admission
will become effective on or around 8.00 a.m. on 3 August 2022 and that
dealings in the EIS/VCT Placing Shares will commence at that time. It is
expected that settlement of the General Placing Shares and the Initial
Consideration Shares and General Admission will become effective on or around
8.00 a.m. on 4 August 2022 and that dealings in the General Placing Shares and
the Initial Consideration Shares will commence at that time.
PAYMENT FOR SHARES
Each Placee has a separate, irrevocable and binding obligation to pay the
Placing Price in cleared funds for the number of Placing Shares duly allocated
to the Placee under the Placing in the manner and by the time directed by
Panmure Gordon. If any Placee fails to pay as so directed and/or by the time
directed, the relevant Placee's application for Placing Shares shall at
Panmure Gordon's discretion either be rejected or accepted in which case the
paragraph below entitled "Registration and Settlement" shall apply to such
application.
PARTICIPATION IN, AND PRINCIPAL TERMS OF, THE PLACING
Panmure Gordon (whether itself or through its affiliates) is arranging the
Placing as placing agent of the Company for the purpose of using reasonable
endeavours to procure Placees at the Placing Price for the Placing Shares.
Participation in the Placing will only be available to persons who may
lawfully be, and are, invited to participate by Panmure Gordon. Panmure Gordon
and its affiliates may participate in the Placing as principal.
By participating in the Placing, Placees will be deemed to have read and
understood this Announcement, including this Appendix, in its entirety and to
be participating and making an offer for Placing Shares on the terms and
conditions, and to be providing the representations, warranties,
acknowledgements, agreements and undertakings contained in this Appendix.
This Appendix gives details of the terms and conditions of, and the mechanics
of participation in, the Placing. No commissions will be paid to Placees or by
Placees in respect of any Placing Shares.
The number of Placing Shares to be issued, and the extent of each Placee's
participation in the Placing (which will not necessarily be the same for each
Placee), will be agreed between Panmure Gordon (following consultation with
the Company) following completion of the book building process in respect of
the Placing (the "Bookbuild"). No element of the Placing will be underwritten.
The aggregate number of Placing Shares will be announced on a Regulatory
Information Service following completion of the Bookbuild.
A Placee's commitment to acquire a fixed number of Placing Shares under the
Placing will be agreed orally with Panmure Gordon as agent of the Company.
Each Placee's allocation will be confirmed to Placees orally or by email by
Panmure Gordon, and a form of confirmation will be dispatched as soon as
possible thereafter. The oral or email confirmation to such Placee will
constitute an irrevocable legally binding commitment upon such person (who
will at that point become a Placee) in favour of Panmure Gordon and the
Company, under which it agrees to acquire the number of Placing Shares
allocated to it at the Placing Price on the terms and conditions set out in
this Appendix and in accordance with the articles of incorporation of the
Company.
Except as required by law or regulation, no press release or other
announcement will be made by Panmure Gordon or the Company using the name of
any Placee (or its agent), in its capacity as Placee (or agent), other than
with such Placee's prior written consent.
Irrespective of the time at which a Placee's allocation pursuant to the
Placing is confirmed, settlement for all Placing Shares to be acquired
pursuant to the Placing will be required to be made on the basis explained
below under the paragraph entitled "Registration and Settlement".
All obligations under the Placing will be subject to fulfilment or (where
applicable) waiver of, amongst other things, the conditions referred to below
and to the Placing not being terminated on the basis referred to below.
By participating in the Placing, each Placee will agree that its rights and
obligations in respect of the Placing will terminate only in the circumstances
described below and will not be capable of rescission or termination by the
Placee.
To the fullest extent permissible by law, none of the Company, Panmure Gordon
or any of their respective affiliates shall have any liability to Placees (or
to any other person whether acting on behalf of a Placee or otherwise under
these terms and conditions). In particular, none of the Company, Panmure
Gordon or any of their respective affiliates shall have any liability
(including to the fullest extent permissible by law, any fiduciary duties) in
respect of Panmure Gordon's conduct of the Placing. Each Placee acknowledges
and agrees that the Company is responsible for the issue of the Placing Shares
to the Placees and Panmure Gordon shall have no liability to the Placees for
the failure of the Company to fulfil those obligations.
CONDITIONS OF THE PLACING
Panmure Gordon's obligations under the Placing Agreement in respect of the
EIS/VCT Placing Shares are conditional on, inter alia:
1. the Company allotting, subject only to EIS/VCT Admission, the EIS/VCT
Placing Shares in accordance with the Placing Agreement;
2. EIS/VCT Admission taking place not later than 8.00 a.m. on 3 August
2022 (or such later date as may be agreed in writing between the Company and
Panmure Gordon);
3. the Tetris Pharma SPA:
a. having been duly executed by all parties thereto; and
b. not having lapsed or been terminated prior to EIS/VCT Admission
pursuant to the terms thereof;
4. the Xeris Licence Amendment:
a. having been duly executed by all parties thereto; and
b. not having lapsed or been terminated prior to EIS/VCT Admission
pursuant to the terms thereof; and
5. the Company having complied with its obligations under the Placing
Agreement.
If (a) any of the conditions contained in the Placing Agreement in relation to
the EIS/VCT Placing Shares are not fulfilled or waived by Panmure Gordon by
the respective time or date where specified (or such later time or date as the
Company and Panmure Gordon may agree not being later than 5.00 p.m. on 15
August 2022 (the "Final Date")); or (b) the Placing Agreement is terminated as
described below, the Placing in relation to the EIS/VCT Placing Shares will
lapse and the Placees' rights and obligations hereunder in relation to the
EIS/VCT Placing Shares shall cease and terminate at such time and each Placee
agrees that no claim can be made by the Placee in respect thereof.
The EIS/VCT Placing is not conditional on completion of the Acquisition, the
issue of the General Placing Shares or General Admission. Investors should
note that it is possible that EIS/VCT Admission will occur but the Acquisition
and General Admission will not occur.
Panmure Gordon's obligations under the Placing Agreement in respect of the
General Placing Shares are conditional on, inter alia:
1. EIS/VCT Admission having occurred and the Company allotting, subject
only to General Admission, the General Placing Shares in accordance with the
Placing Agreement and the Initial Consideration Shares in accordance with the
Tetris Pharma SPA;
2. General Admission taking place not later than 8.00 a.m. on 4 August
2022 (or such later date as may be agreed in writing between the Company and
Panmure Gordon);
3. the Tetris Pharma SPA:
a. having been duly executed by all parties thereto;
b. not having lapsed or been terminated prior to General Admission
pursuant to the terms thereof; and
c. having become unconditional in all respects in accordance with its
terms, subject only to General Admission and the issue by the Company of the
Initial Consideration Shares to the Tetris Pharma Sellers;
4. the Xeris Licence Amendment:
a. having been duly executed by all parties thereto;
b. not having lapsed or been terminated prior to General Admission
pursuant to the terms thereof;
c. having become unconditional in all respects in accordance with its
terms, subject only to payment of the Inventory Payment and completion of the
Acquisition; and
5. the Company having complied with its obligations under the Placing
Agreement.
If (a) any of the conditions contained in the Placing Agreement in relation to
the General Placing Shares are not fulfilled or waived by Panmure Gordon by
the respective time or date where specified (or such later time or date as the
Company and Panmure Gordon may agree not being later than 5.00 p.m. on the
Long Stop Date); or (b) the Placing Agreement is terminated as described
below, the Placing in relation to the General Placing Shares will lapse and
the Placees' rights and obligations hereunder in relation to the General
Placing Shares shall cease and terminate at such time and each Placee agrees
that no claim can be made by the Placee in respect thereof.
Subject to certain exceptions, Panmure Gordon may, at its absolute discretion
and upon such terms as it thinks fit, waive, or extend the period (up to the
Long Stop Date) for, compliance by the Company with the whole or any part of
any of the Company's obligations in relation to the conditions in the Placing
Agreement. Any such extension or waiver will not affect Placees' commitments
as set out in this Announcement.
Neither Panmure Gordon nor the Company 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 they may make as to whether or not to waive or to
extend the time and/or date for the satisfaction of any condition to the
Placing nor for any decision they may make as to the satisfaction of any
condition or in respect of the Placing generally and by participating in the
Placing each Placee agrees that any such decision is within the absolute
discretion of Panmure Gordon.
RIGHT TO TERMINATE UNDER THE PLACING AGREEMENT
Panmure Gordon is entitled, at any time before either Admission, to terminate
the Placing Agreement in respect of the EIS/VCT Placing Shares at any time
before EIS/VCT Admission and in respect of the General Placing Shares at any
time before General Admission by giving notice to the Company in certain
circumstances, including, inter alia:
1. where the Company has failed to comply with any of its obligations
under the Placing Agreement which is material in the context of the Group, the
Placing, EIS/VCT Admission and/or General Admission; or
2. where there has been a breach of the SPA or the Xeris Licence Amendment
by any party which is, in Panmure Gordon's opinion, material in the context of
the Group, the Placing, EIS/VCT Admission and/or General Admission or any
party to the SPA or the Xeris Licence Amendment has terminated or rescinded
(or purported to terminate or rescind) such agreement;
3. where any of the warranties given by the Company to Panmure Gordon
under the Placing Agreement not being true or accurate or being misleading
when given or would not be true and accurate or would be misleading if
repeated (by reference to the facts and circumstances in each case then
existing) in a respect which is material in the context of the Group, the
Placing, EIS/VCT Admission and/or General Admission; or
4. where, amongst other things, there is a material adverse change in the
condition, earnings, business, operations or prospects of the Group or if
there is a material adverse change in the financial, political, economic or
stock market conditions, which in Panmure Gordon's reasonable opinion (acting
in good faith) makes it impractical or inadvisable to proceed with the
Placing.
Following General Admission, the Placing Agreement is not capable of
termination to the extent that it relates to the Placing of the Placing
Shares.
The rights and obligations of the Placees shall terminate only in the
circumstances described in these terms and conditions and in the Placing
Agreement and will not be subject to termination by the Placee or any
prospective Placee at any time or in any circumstances. By participating in
the Placing, Placees agree that the exercise by Panmure Gordon of any right of
termination or other discretion under the Placing Agreement shall be within
the absolute discretion of Panmure Gordon, and that it need not make any
reference to Placees and that it shall have no liability to Placees whatsoever
in connection with any such exercise or decision not to exercise. Placees will
have no rights against Panmure Gordon, the Company or any of their respective
directors or employees under the Placing Agreement pursuant to the Contracts
(Rights of Third Parties) Act 1999 (as amended).
NO PROSPECTUS
The Placing Shares are being offered to Relevant Persons only and will not be
offered in such a way as to require a prospectus in the United Kingdom or
elsewhere. No offering document or prospectus has been or will be submitted to
be approved by the FCA in relation to the Placing and Placees' commitments
will be made solely on the basis of the information contained in this
Announcement (including this Appendix) and certain business and financial
information the Company is required to publish in accordance with the AIM
Rules and the rules and practices of the FCA (collectively "Exchange
Information").
Each Placee, by accepting a participation in the Placing, agrees that the
content of this Announcement, including this Appendix, is exclusively the
responsibility of the Company and confirms that it has not relied on any other
information (other than the Exchange Information), representation, warranty,
or statement made by or on behalf of the Company or Panmure Gordon or any
other person and neither of Panmure Gordon nor the Company nor any other
person will be liable for any Placee's decision to participate in the Placing
based on any other information, representation, warranty or statement which
the Placees may have obtained or received. Each Placee acknowledges and agrees
that it has relied on its own investigation of the business, financial or
other position of the Company in accepting a participation in the Placing.
Nothing in this paragraph shall exclude the liability of any person for
fraudulent misrepresentation.
REGISTRATION AND SETTLEMENT
Settlement of transactions in the Placing Shares (ISIN: GB00BMWLM973)
following Admission will take place within CREST provided that, subject to
certain exceptions, Panmure Gordon reserves the right to require settlement
for, and delivery of, the Placing Shares (or a portion thereof) to Placees by
such other means that it may deem necessary if delivery or settlement is not
possible or practicable within CREST within the timetable set out in this
Announcement or would not be consistent with the regulatory requirements in
any Placee's jurisdiction.
Each Placee allocated Placing Shares in the Placing will be sent a trade
confirmation stating the number of Placing Shares allocated to it at the
Placing Price, the aggregate amount owed by such Placee to Panmure Gordon (as
agent for the Company) and settlement instructions. Each Placee agrees that it
will do all things necessary to ensure that delivery and payment is completed
in accordance with either the CREST or certificated settlement instructions
that it has in place with Panmure Gordon.
Settlement of transactions in the Placing Shares (ISIN: GB00BMWLM973)
following the relevant Admission will take place within the CREST system,
subject to certain exceptions. Settlement through CREST of the EIS/VCT
Placing Shares is expected to take place on 3 August 2022 unless otherwise
notified by Panmure Gordon and EIS/VCT Admission is expected to occur no later
than 8.00 a.m. on 3 August 2022 unless otherwise notified by Panmure Gordon.
Settlement through CREST of the General Placing Shares is expected to take
place on 4 August 2022 unless otherwise notified by Panmure Gordon and General
Admission is expected to occur no later than 8.00 a.m. on 4 August 2022 unless
otherwise notified by Panmure Gordon.
The relevant Admission and settlement may occur at an earlier date. Settlement
will be on a delivery versus payment basis. However, in the event of any
difficulties or delays in the admission of the Placing Shares to CREST or the
use of CREST in relation to the Placing, the Company and Panmure Gordon may
agree that the Placing Shares should be issued in certificated form. Panmure
Gordon reserves the right to require settlement for the Placing Shares, and to
deliver the Placing Shares to Placees, by such other means as it may deem
necessary if delivery or settlement to Placees is not practicable within the
CREST system or would not be consistent with regulatory requirements in a
Placee's jurisdiction.
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 Libor as determined by Panmure Gordon.
Each Placee is deemed to agree that, if it does not comply with these
obligations, Panmure Gordon may sell any or all of the Placing Shares
allocated to that Placee on such Placee's behalf and retain from the proceeds,
for Panmure Gordon's account and benefit (as agent for the Company), an amount
equal to the aggregate amount owed by the Placee plus any interest due. Any
excess proceeds will pass to the relevant Placee at its risk. The relevant
Placee will, however, remain liable and shall indemnify Panmure Gordon on
demand for any shortfall below the aggregate amount owed by it and may be
required to bear any stamp duty or stamp duty reserve tax or securities
transfer tax (together with any interest or penalties) which may arise upon
the sale of such Placing Shares on such Placee's behalf. By communicating a
bid for Placing Shares, each Placee confers on Panmure Gordon all such
authorities and powers necessary to carry out any such sale and agrees to
ratify and confirm all actions which Panmure Gordon lawfully take in pursuance
of such sale.
If Placing Shares are to be delivered to a custodian or settlement agent,
Placees 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 a Placee's name or that of its
nominee or in the name of any person for whom a Placee is contracting as agent
or that of a nominee for such person, such Placing Shares should, subject as
provided below, be so registered free from any liability to UK stamp duty or
stamp duty reserve tax or securities transfer tax. Placees will not be
entitled to receive any fee or commission in connection with the Placing.
REPRESENTATIONS, WARRANTIES AND FURTHER TERMS
By participating in the Placing, each Placee (and any person acting on such
Placee's behalf) makes the following representations, warranties,
acknowledgements, agreements and undertakings (as the case may be) to the
Company and Panmure Gordon, namely that, each Placee (and any person acting on
such Placee's behalf):
1. represents and warrants that it has read and understood this
Announcement, including this Appendix, in its entirety and that its
subscription of Placing Shares is subject to, and based upon, all the terms,
conditions, representations, warranties, acknowledgements, agreements and
undertakings and other information contained herein and undertakes not to
redistribute or duplicate this Announcement (including this Appendix);
2. acknowledges that no offering document or prospectus has been prepared
in connection with the placing of the Placing Shares and represents and
warrants that it has not received a prospectus or other offering document in
connection therewith;
5. acknowledges that the Placing Shares are admitted to trading on AIM,
and the Company is therefore required to publish certain business and
financial information in accordance with the AIM Rules (collectively the
"Exchange Information"), which includes a description of the nature of the
Company's business and the Company's most recent balance sheet and profit and
loss account and that the Placee is able to obtain or access such information
without undue difficulty, and is able to obtain access to such information or
comparable information concerning any other publicly traded company, without
undue difficulty;
6. acknowledges that the content of this Announcement (including this
Appendix) is exclusively the responsibility of the Company, and that none of
Panmure Gordon, its affiliates or any person acting on their behalf has or
shall have any liability for any information, representation or statement
contained in this Announcement (including this Appendix) or any information
previously or concurrently published by or on behalf of the Company (including
any Exchange Information), and will not be liable for any Placee's decision to
participate in the Placing based on any information, representation or
statement contained in this Announcement (including this Appendix) 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 itself to acquire the Placing Shares is contained in this
Announcement (including this Appendix) and any Exchange Information, such
information being all that it deems necessary to make an investment decision
in respect of the Placing Shares and that it has neither received nor relied
on any other information given or representations, warranties or statements
made by Panmure Gordon or the Company or any of their respective directors,
officers or employees or any person acting on behalf of any of them (including
with respect to the Company, the Placing, the Placing Shares or the accuracy,
completeness or adequacy of any publicly available information), or, if
received, it has not relied upon any such information, representations,
warranties or statements, and neither of Panmure Gordon nor the Company will
be liable for any Placee's decision to accept an invitation to participate in
the Placing based on any other information, representation, warranty or
statement. Each Placee further acknowledges and agrees that it may not place
the same degree of reliance on this Announcement as it may otherwise place on
a prospectus or admission document. Each Placee further acknowledges and
agrees that it has relied solely on its own investigation of the business,
financial or other position of the Company and the terms of the Placing in
deciding to participate in the Placing and it will not rely on any
investigation that Panmure Gordon, their affiliates or any other person acting
on their behalf has or may have conducted;
7. represents and warrants that it has neither received nor relied on any
confidential price sensitive information concerning the Company in accepting
this invitation to participate in the Placing;
8. acknowledges that Panmure Gordon does not have any duties or
responsibilities to it, or its clients, similar or comparable to the duties of
"best execution" and "suitability" imposed by the Conduct of Business
Sourcebook in the FCA's Handbook of Rules and Guidance and that Panmure Gordon
is not acting for it or its clients and that Panmure Gordon will not be
responsible for providing protections to it or its clients;
9. acknowledges that none of Panmure Gordon, any of its affiliates or any
person acting on behalf of them has or shall have any liability for any
publicly available or filed information (including any Exchange Information)
or any representation relating to the Company, provided that nothing in this
paragraph excludes the liability of any person for fraudulent
misrepresentation made by that person;
10. acknowledges that, save in the event of fraud on the part of Panmure
Gordon (and to the extent permitted by the FCA), none of Panmure Gordon, its
ultimate holding company nor any direct or indirect subsidiary undertakings of
such holding company, nor any of their respective directors and employees
shall be liable to Placees for any matter arising out of Panmure Gordon's role
as placing agent or otherwise in connection with the Placing and that where
any such liability nevertheless arises as a matter of law, Placees will
immediately waive any claim against any of such persons which it may have in
respect thereof;
11. represents and warrants that (a) (i) it is not in the United States;
(ii) it is not a U.S. Person; and (iii) it is not acting for the account or
benefit of a U.S. Person or (b) it is a dealer or other professional fiduciary
in the United States acting for a discretionary account (other than an estate
or trust) held for the benefit or account of a non U.S. Person in reliance on
Regulation S;
12. acknowledges that the Placing Shares are only being offered and sold
outside the United States in offshore transactions to persons who are not U.S.
Persons pursuant to Regulation S under the Securities Act, and the Placing
Shares have not been and will not be registered under the Securities Act or
under any laws of, or with any securities regulatory authority of, any state
or other jurisdiction of the United States, and agrees not to reoffer, resell,
pledge, transfer or deliver any Placing Shares, directly or indirectly, in the
United States or to, or for the account or benefit of, U.S. Persons, except
pursuant to an exemption from, or in a transaction not subject to, the
registration requirements of the Securities Act and in compliance with any
applicable securities laws of any state or other jurisdiction in the United
States;
13. unless otherwise specifically agreed in writing with Panmure Gordon,
represents and warrants that neither it nor the beneficial owner of such
Placing Shares will be a resident of the Restricted Jurisdictions;
14. acknowledges that the Placing Shares have not been and will not be
registered under the securities legislation of the Restricted Jurisdictions
and, subject to certain exceptions, may not be offered, sold, taken up,
renounced or delivered or transferred, directly or indirectly, within those
jurisdictions;
15. represents and warrants that the issue to it, or the person specified by
it for registration as holder, of Placing Shares will not give rise to a
liability under any of sections 67, 70, 93 or 96 of the Finance Act 1986
(depositary receipts and clearance services) and that the Placing Shares are
not being acquired in connection with arrangements to issue depositary
receipts or to transfer Placing Shares into a clearance system;
16. represents and warrants that: (i) it has complied with and will continue
to comply with its obligations under the Market Abuse Regulation (EU) No.
596/2014, Criminal Justice Act 1993 and Part VIII of the Financial Services
and Markets Act 2000, as amended ("FSMA") and other applicable law; (ii) in
connection with money laundering and terrorist financing, it has complied with
its obligations under the Proceeds of Crime Act 2002 (as amended), the
Terrorism Act 2000 (as amended), the Terrorism Act 2006, the Money Laundering,
Terrorist Financing and Transfer of Funds (Information on the Payer) 2017
Regulations, and any other applicable law (where all such legislation listed
under this (ii) shall together be referred to as the "AML Legislation"); and
(iii) it is not a person: (1) with whom transactions are prohibited under the
Foreign Corrupt Practices Act of 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; (2) named on the Consolidated
List of Financial Sanctions Targets maintained by HM Treasury of the United
Kingdom; or (3) subject to financial sanctions imposed pursuant to a
regulation of the EU or a regulation adopted by the United Nations (together,
the "Regulations"); and, if 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 pursuant to AML
Legislation and has obtained all governmental and other consents (if any)
which may be required for the purpose of, or as a consequence of, such
purchase, and it will provide promptly to Panmure Gordon or the Company such
evidence, if any, as to the identity or location or legal status of any person
(including in relation to the beneficial ownership of any underlying investor)
which Panmure Gordon or the Company may request from it in connection with the
Placing (for the purpose of complying with such Regulations or ascertaining
the nationality of any person or the jurisdiction(s) to which any person is
subject or otherwise or any other information as may be required to comply
with legal or regulatory requirements (including in particular under the AML
Legislation)) in the form and manner requested by Panmure Gordon or the
Company on the basis that any failure by it to do so may result in the number
of Placing Shares that are to be purchased by it or at its direction pursuant
to the Placing being reduced to such number, or to nil, as Panmure Gordon may
decide at its sole discretion;
17. if a financial intermediary, as that term is used in Article 5(1) of the
Prospectus Regulation, represents and warrants that 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 or the UK other than Qualified
Investors, or in circumstances in which the prior consent of Panmure Gordon
has been given to the offer or resale;
18. represents and warrants that it has not offered or sold and will not
offer or sell any Placing Shares to persons in the EEA or the UK prior to
Admission except to persons whose ordinary activities involve them in
acquiring, holding, managing or disposing of investments (as principal or
agent) for the purposes of their business or otherwise in circumstances which
have not resulted in and which will not result in an offer to the public in
any Member State of the EEA or the UK within the meaning 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 the FSMA) relating to the Placing Shares in circumstances in
which section 21(1) of the FSMA does not require approval of the communication
by an authorised person;
20. represents and warrants that it has complied and will comply with all
applicable provisions of the FSMA and the Financial Services Act 2012 with
respect to anything done by it in relation to the Placing Shares in, from or
otherwise involving, the United Kingdom;
21. if in the United Kingdom, represents and warrants that it is a person
who: (i) falls with Articles 49(2)(A) to (D) or 19(5) of the Order or it is a
person to whom the Placing Shares may otherwise be lawfully offered under such
Order or, if it is receiving the offer in circumstances under which the laws
or regulations of a jurisdiction other than the United Kingdom would apply, it
is a person to whom the Placing Shares may be lawfully offered under that
other jurisdiction's laws and regulations; and (ii) is a "professional client"
or an "eligible counterparty" within the meaning of Chapter 3 of the FCA's
Conduct of Business Sourcebook;
22. represents and warrants that it and any person acting on its behalf is
entitled to acquire the Placing Shares under the laws of all relevant
jurisdictions and that it has all necessary capacity and has obtained all
necessary consents and authorities and taken any other necessary actions to
enable it to commit to this participation in the Placing and to perform its
obligations in relation thereto (including, without limitation, in the case of
any person on whose behalf it is acting, all necessary consents and
authorities to agree to the terms set out or referred to in this Announcement
(including this Appendix)) and will honour such obligations;
23. where it is acquiring Placing Shares for one or more managed accounts,
represents and warrants that it is authorised in writing by each managed
account: (i) to acquire the Placing Shares for each managed account; (ii) to
make on its behalf the representations, warranties, acknowledgements,
undertakings and agreements in this Appendix and the Announcement of which it
forms part; and (iii) to receive on its behalf any investment letter relating
to the Placing in the form provided to it by Panmure Gordon;
24. undertakes that it (and any person acting on its behalf) will make
payment for the Placing Shares allocated to it in accordance with this
Announcement (including this Appendix) on the due time and date set out
herein, failing which the relevant Placing Shares may be placed with other
subscribers or sold as Panmure Gordon may in its sole discretion determine and
without liability to such Placee and it will remain liable and will indemnify
Panmure Gordon on demand for any shortfall below the net proceeds of such sale
and the placing proceeds of such Placing Shares and may be required to bear
the liability for any stamp duty or stamp duty reserve tax or security
transfer tax (together with any interest or penalties due pursuant to or
referred to in these terms and conditions) which may arise upon the placing or
sale of such Placee's Placing Shares on its behalf;
25. acknowledges that none of Panmure Gordon, any of its affiliates, 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 treated for these purposes as a client of
Panmure Gordon and that Panmure Gordon does not have any duties or
responsibilities to it for providing the protections afforded to its clients
or customers or for providing advice in relation to the Placing nor in respect
of any representations, warranties, undertakings or indemnities contained in
the Placing Agreement nor for the exercise or performance of any of their
rights and obligations thereunder, including any rights to waive or vary any
conditions or exercise any termination right;
26. undertakes that the person whom it specifies for registration as holder
of the Placing Shares will be (i) itself; or (ii) its nominee, as the case may
be. Neither Panmure Gordon 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. Each Placee and any person acting on behalf of such
Placee agrees to participate in the Placing and it agrees to indemnify the
Company and Panmure Gordon in respect of the same on the basis that the
Placing Shares will be issued to the CREST stock account of Panmure Gordon who
will hold them as nominee on behalf of such Placee until settlement in
accordance with its standing settlement instructions;
27. acknowledges that these terms and conditions and 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 agreement shall be
governed by and construed in accordance with the laws of England 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 English courts as regards any
claim, dispute or matter (including non-contractual matters) 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 Panmure Gordon 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;
28. acknowledges that time shall be of the essence as regards to obligations
pursuant to this Appendix;
29. agrees that the Company, Panmure Gordon and their respective affiliates
and others will rely upon the truth and accuracy of the foregoing
representations, warranties, acknowledgements and undertakings which are given
to Panmure Gordon on its own behalf and on behalf of the Company and are
irrevocable and are irrevocably authorised to produce this Announcement or a
copy thereof to any interested party in any administrative or legal proceeding
or official inquiry with respect to the matters covered hereby;
30. agrees to indemnify on an after-tax basis and hold the Company, Panmure
Gordon and their respective affiliates harmless from any and all costs,
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 Appendix and further
agrees that the provisions of this Appendix shall survive after completion of
the Placing;
31. acknowledges that no action has been or will be taken by any of the
Company, Panmure Gordon or any person acting on behalf of the Company or
Panmure Gordon that would, or is intended to, permit a public offer of the
Placing Shares in any country or jurisdiction where any such action for that
purpose is required;
32. acknowledges that it is an institution that 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 in this sector and is aware that it may be required to bear, and
it, and any accounts for which it may be acting, are able to bear, the
economic risk of, and is able to sustain, a complete loss in connection with
the Placing. It has relied upon its own examination and due diligence of the
Company and its associates taken as a whole, and the terms of the Placing,
including the merits and risks involved;
33. acknowledges that its commitment to subscribe for Placing Shares on the
terms set out herein and in the trade confirmation will continue,
notwithstanding any amendment that may in the 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;
34. acknowledges that Panmure Gordon or any of its affiliates acting as an
investor for its own account may take up shares in the Company and in that
capacity may retain, purchase or sell for its own account such shares and may
offer or sell such shares other than in connection with the Placing;
35. represents and warrants that, if it is a pension fund or investment
company, its purchase of Placing Shares is in full compliance with all
applicable laws and regulation; and
36. to the fullest extent permitted by law, it acknowledges and agrees to
the disclaimers contained in the Announcement, including this Appendix.
The representations, warranties, acknowledgments and undertakings contained in
this Appendix are given to Panmure Gordon and the Company and are irrevocable
and shall not be capable of termination in any circumstances.
The agreement to settle a Placee's subscription (and/or the subscription of a
person for whom such Placee is contracting as agent) free of stamp duty and
stamp duty reserve tax depends on the settlement relating only to a
subscription by it and/or such person direct from the Company for the Placing
Shares in question. Such agreement assumes that the Placing Shares are not
being subscribed for in connection with arrangements to issue depositary
receipts or to transfer the Placing Shares into a clearance service. If there
are any such arrangements, or the settlement relates to any other subsequent
dealing in the Placing Shares, stamp duty or stamp duty reserve tax may be
payable, for which neither the Company nor Panmure Gordon 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, issue or delivery of Placing Shares has given rise to such UK
stamp duty or stamp duty reserve tax undertakes to pay such UK stamp duty or
stamp duty reserve tax forthwith and to indemnify on an after-tax basis and to
hold harmless the Company and Panmure Gordon in the event that any of the
Company and/or Panmure Gordon has incurred any such liability to UK stamp duty
or stamp duty reserve tax. If this is the case, each Placee should seek its
own advice and notify Panmure Gordon accordingly.
In addition, Placees should note that they will be liable for any 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
subscription by them of any Placing Shares or the agreement by them to
subscribe for any Placing Shares.
Each Placee, and any person acting on behalf of the Placee, acknowledges that
Panmure Gordon 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 such Placee acknowledges and
agrees that Panmure Gordon or any of its affiliates may, at their absolute
discretion, agree to become a Placee in respect of some or all of the Placing
Shares.
When a Placee or person acting on behalf of such Placee is dealing with
Panmure Gordon, any money held in an account with Panmure Gordon on behalf of
such Placee and/or any person acting on behalf of such Placee will not be
treated as client money within the meaning of the rules and regulations of the
FCA made under the FSMA. Each 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 from Panmure Gordon's money in
accordance with the client money rules and will be used by Panmure Gordon in
the course of its own business and such Placee will rank only as a general
creditor of Panmure Gordon.
All times and dates in this Announcement (including this Appendix) may be
subject to amendment, and Placees' commitments, representations and warranties
are not conditional on any of the expected times and dates in this
Announcement (including this Appendix) being achieved. Panmure Gordon shall
notify the Placees and any person acting on behalf of the Placees of any
changes.
Past performance is no guide to future performance and persons needing advice
should consult an appropriately qualified independent financial adviser.
Panmure Gordon is entitled, at its discretion and out of its own resources, at
any time to rebate to some or all of its investors, or to other parties, part
or all of its fees relating to the Placing.
MISCELLANEOUS
Solely for the purposes of the product governance requirements contained
within the FCA Handbook Product Intervention and Product Governance Sourcebook
(the "UK Product Governance Rules"), and disclaiming all and any liability,
whether arising in tort, contract or otherwise, which any "manufacturer" (for
the purposes of the UK Product Governance Rules) may otherwise have with
respect thereto, the Ordinary Shares have been subject to a product approval
process, which has determined that the Ordinary Shares are: (i) compatible
with an end target market of investors who meet the criteria of professional
clients and eligible counterparties each as defined in the FCA Handbook
Conduct of Business Sourcebook ("COBS"); and (ii) eligible for distribution
through all distribution channels as are permitted by the UK Product
Governance Rules (the "UK Target Market Assessment").
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 Placing Shares have been subject to a
product approval process, which has determined that the Placing Shares 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 "EU Target Market
Assessment").
Notwithstanding the UK Target Market Assessment and the EU Target Market
Assessment, distributors should note that: the price of the Placing Shares may
decline and investors could lose all or part of their investment; the Placing
Shares offer no guaranteed income and no capital protection; and an investment
in the Placing Shares 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. Each of the UK Target
Market Assessment and the EU 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
UK Target Market Assessment and the EU Target Market Assessment, Panmure
Gordon will only procure investors who meet the criteria of professional
clients and eligible counterparties, as defined under COBS or MiFID II, as
applicable. For the avoidance of doubt, neither the UK Target Market
Assessment nor the EU Target Market Assessment constitutes: (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 Placing
Shares.
Each distributor is responsible for undertaking its own target market
assessment in respect of the Placing Shares and determining appropriate
distribution channels.
The content of this Announcement has been prepared by, and is the sole
responsibility of, Arecor Therapeutics plc.
The information contained in this Announcement is given at the date of its
publication (unless otherwise marked) and is subject to updating, revision and
amendment from time to time. Neither the content of the Company's website nor
any website accessible by hyperlinks to the Company's website is incorporated
in, or forms part of, this Announcement.
Certain statements in this Announcement are forward-looking statements which
are based on the Company's expectations, intentions and projections regarding
its future performance, anticipated events or trends and other matters that
are not historical facts. These forward-looking statements, which may use
words such as "aim", "anticipate", "believe", "could", "intend", "estimate",
"expect" and words of similar meaning, include all matters that are not
historical facts. These forward-looking statements involve risks, assumptions
and uncertainties that could cause the actual results of operations, financial
condition, liquidity and dividend policy and the development of the industries
in which the Company's businesses operate to differ materially from the
impression created by the forward-looking statements. These statements are not
guarantees of future performance and are subject to known and unknown risks,
uncertainties and other factors that could cause actual results to differ
materially from those expressed or implied by such forward-looking statements.
Given those risks and uncertainties, prospective investors are cautioned not
to place undue reliance on forward-looking statements. Forward-looking
statements speak only as of the date of such statements and, except as
required by the FCA, the London Stock Exchange or applicable law, the Company
undertakes no obligation to update or revise publicly any forward-looking
statements, whether as a result of new information, future events or
otherwise.
Panmure Gordon (UK) Limited ("Panmure Gordon"), which is authorised and
regulated in the United Kingdom by the FCA, is acting as nominated adviser and
sole bookrunner to the Company in connection with the Placing and Admission
and to no-one else and will not be responsible to anyone other than the
Company for providing the protections afforded to its clients, nor for
providing advice in relation to the Placing or Admission or any other matter
referred to in this Announcement. Panmure Gordon's responsibilities as the
Company's nominated adviser under the AIM Rules for Nominated Advisers are
owed solely to London Stock Exchange plc and are not owed to the Company or to
any director of the Company or to any other person in respect of any decision
to acquire shares in the Company in reliance on any part of this Announcement.
None of Panmure Gordon, or any of its directors, officers, employees,
advisers, affiliates or agents, accepts any responsibility or liability
whatsoever for or makes any representation or warranty, express or implied, as
to this Announcement, including the truth, accuracy or completeness of the
information in this Announcement (or whether any information has been omitted
from the Announcement) or for any loss howsoever arising from any use of the
Announcement or its contents. Panmure Gordon and its directors, officers,
employees, advisers, affiliates or agents, accordingly disclaim all and any
liability whether arising in tort, contract or otherwise which they might
otherwise have in respect of this Announcement or its contents or otherwise
arising in connection therewith.
Data Protection
The processing of a Placee's personal data by the Company will be carried out
in compliance with the applicable data protection legislation and with its
Privacy Notice, a copy of which can be found on the Company's website
https://arecor.com/
Each Placee acknowledges that it has read and understood the processing
activities carried out by the Company as informed in the referred Privacy
Notice.
APPENDIX III
DEFINITIONS
The following definitions apply throughout the Announcement, unless the
context requires otherwise:
"Acquisition" the acquisition by the Company of the entire issued share capital of Tetris
Pharma in accordance with the terms of the SPA
"Admission" EIS/VCT Admission in the case of the EIS/VCT Placing Shares and General
Admission in the case of the General Placing Shares and the Initial
Consideration Shares
"AIM" AIM, the market of that name operated by London Stock Exchange
"AIM Rules" the AIM Rules for Companies as published by the London Stock Exchange from
time to time
"Announcement" this announcement, together with the Appendices contained herein
"Board" the board of directors of the Company
"Bookbuild" the process by which the Placing will effectuated, which will be launched
immediately following this Announcement in accordance with the terms and
conditions set out in Appendix II
"certificated" or "in certificated form" in relation to a share or other security, not in uncertificated form (that is,
not in CREST)
"Company" or "Arecor" Arecor Therapeutics plc, a public limited company incorporated in England and
Wales with registered number 13331147
"Completion" completion of the Acquisition
"CREST" the relevant system (as defined in the CREST Regulations) in respect of which
Euroclear is the operator (as defined in the CREST Regulations), which
facilitates the transfer of title to shares in uncertificated form
"CREST Regulations" the Uncertificated Securities Regulations 2001 (SI 2001/3755) (as amended)
"Directors" the directors of the Company
"Deferred Consideration Shares" the potential new Ordinary Shares to be issued pursuant to the Earn Out, such
shares to be issued at no less than the higher of £4.05 per Ordinary Shares
and 30-day volume weighted average share price of Arecor on the 30 business
days prior to the Earn Out determination date
"Earn Out" or "Earn Out Payment" the deferred consideration of up to £4.0 million to be paid to the Tetris
Pharma Sellers subject to the achievement of performance conditions on each of
the first, second and third anniversary of Completion and to be satisfied
through the issue of either (i) Deferred Consideration Shares or (ii)
unsecured loan notes having an aggregate principal value equal to the amount
of the relevant payment, at the Company's election
"EEA" European Economic Area
"EIS" Enterprise Investment Scheme
"EIS/VCT Admission" admission of the EIS/VCT Placing Shares to trading on AIM becoming effective
in accordance with the AIM Rules
"EIS/VCT Placing" the conditional placing of EIS/VCT Placing Shares with Placees at the Placing
Price pursuant to the Placing Agreement
"EIS/VCT Placing Shares" the EIS Shares and the VCT Shares together
"EIS Relief" the relief claimed by any holder of the EIS Shares under Part 5 of the ITA
2007 or exemption or relief available under sections 150A, 150C and Schedule
5B Taxation of Chargeable Gains Act 1992
"EIS Shares"
the Placing Shares to be allotted and issued by the Company at the Placing
Price, conditional on EIS/VCT Admission, in connection with the EIS/VCT
Placing, which are intended to qualify for EIS Relief
"Enlarged Share Capital" the entire issued share capital of the Company as enlarged by the issue of the
Placing Shares and Initial Consideration Shares following Admission
"EU" European Union
"Euroclear" Euroclear UK & Ireland Limited
"Existing Ordinary Shares" the 27,835,024 Ordinary Shares in issue on the date of this Announcement
"FCA" the Financial Conduct Authority
"FSMA" Financial Services and Market Act 2000 (as amended)
"General Admission" admission of the General Placing Shares and the Initial Consideration Shares
to trading on AIM becoming effective in accordance with the AIM Rules
"General Placing" the conditional placing of the General Placing Shares with Placees at the
Placing Price pursuant to the Placing Agreement
"General Placing Shares" the Placing Shares to be allotted and issued by the Company at the Placing
Price, conditional on General Admission, in connection with the General
Placing (excluding the EIS/VCT Placing Shares)
"Group" the Company and its subsidiaries
"Initial Consideration Shares" the 651,726 new Ordinary Shares to be issued by the Company to the Tetris
Pharma Sellers pursuant to the SPA
"Inventory Payment" the payment of $1,217,388 to be made by Tetris Pharma to Xeris in relation to
the initial Ogluo® inventory held by Tetris Pharma, payable in accordance
with the Xeris Licence Amendment
"ISIN" International Securities Identification Number
"ITA 2007" Income Tax Act 2007
"London Stock Exchange" London Stock Exchange plc
"Long Stop Date" 15 August 2022
"Ordinary Shares" ordinary shares of £0.01 each in the capital of the Company
"Panmure Gordon" Panmure Gordon (UK) Limited
"Placing Agreement" the agreement dated 1 August 2022 between the Company and Panmure Gordon in
respect of the Placing
"Placees"
the persons who have agreed to subscribe for Placing Shares under the Placing
"Placing" the conditional placing by the Company of the Placing Shares with the Placees,
otherwise than on a pre-emptive basis, at the Placing Price pursuant to the
Placing Agreement and comprising the EIS/VCT Placing and the General Placing
"Placing Price" 300 pence per Placing Share
"Placing Shares" the new Ordinary Shares which are the subject of the Placing and comprising of
the EIS/VCT Placing Shares and the General Placing Shares
"Registrar" Computershare Investor Services plc of The Pavilions, Bridgwater Road, Bristol
BS13 8AE
"Regulatory Information Service" has the meaning given in the AIM Rules
"Restricted Jurisdiction" the US, Australia, Canada, Japan, New Zealand and the Republic of South Africa
"Securities Act" US Securities Act of 1933 (as amended)
"Shareholders" the holders of Existing Ordinary Shares
"SPA" The share sale and purchase agreement dated 1 August 2022 and entered into
between (1) the Company and (2) the Tetris Pharma Sellers in connection with
the Acquisition
"stock account" an account within a member account in CREST to which a holding of a particular
share or other security in CREST is credited
"Tetris Pharma" Tetris Pharma Ltd, a private limited company incorporated in England and Wales
with registered number 12548259
"Tetris Pharma Payments" the payments to be made by Tetris Pharma in respect of amounts owed by Tetris
Pharma to third parties at completion of the Acquisition
"Tetris Pharma Sellers" the holders of the entire issued share capital of Tetris Pharma
"uncertificated" or "in uncertificated form" in relation to a share or other security, recorded on the relevant register as
being held in uncertificated form in CREST and title to which, by virtue of
the CREST Regulations, may be transferred through CREST
"United Kingdom" or "UK" the United Kingdom of Great Britain and Northern Ireland
"United States", "United States of America" or "US" the United States of America, its territories and possessions, any state of
the United States of America and the District of Columbia and all areas
subject to its jurisdiction
"VCT" Venture Capital Trust as defined by section 259 ITA 2007
"VCT Relief" the relief claimed by any holder of the VCT Shares under Part 6 of the ITA
2007 or exemption or relief available under sections 151A, 151B and Schedule
5C Taxation of Chargeable Gains Act 1992 or Chapter 5 of Part 6 of the Income
Tax (Trading and Other Income) Act 2005
"VCT Shares" the Placing Shares to be allotted and issued by the Company at the Placing
Price, conditional on EIS/VCT Admission, in connection with the EIS/VCT
Placing which are intended to qualify for VCT Relief
"Xeris" Xeris Pharmaceuticals, Inc.
"Xeris Licence Amendment" the amendment number 2 agreement dated 15 July 2022 and entered into between
(1) Xeris, (2) Strongbridge Dublin Limited and (3) Tetris Pharma amending the
licence agreement entered into between them dated 14 July 2021 (as amended by
amendment number 1 on 18 January 2022)
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