REG - Earnz PLC - Result of Placing
09/08/2024 16:00
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RNS Number : 9618Z Earnz PLC 09 August 2024
THIS ANNOUNCEMENT AND THE INFORMATION CONTAINED HEREIN IS RESTRICTED AND IS
NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, IN WHOLE OR IN PART, DIRECTLY OR
INDIRECTLY, IN, INTO OR FROM THE UNITED STATES, AUSTRALIA, CANADA, JAPAN, THE
REPUBLIC OF SOUTH AFRICA, NEW ZEALAND OR ANY OTHER JURISDICTION IN WHICH SUCH
RELEASE, PUBLICATION OR DISTRIBUTION WOULD BE UNLAWFUL. PLEASE SEE THE
IMPORTANT NOTICES AT THE END OF THIS ANNOUNCEMENT.
THIS ANNOUNCEMENT IS NOT AN OFFER TO SELL OR A SOLICITATION TO BUY SECURITIES
IN THE UNITED STATES, CANADA, AUSTRALIA, JAPAN, THE REPUBLIC OF SOUTH AFRICA
AND NEW ZEALAND OR IN ANY OTHER JURISDICTION IN WHICH SUCH OFFER, SOLICITATION
OR SALE WOULD BE UNLAWFUL OR CONTRAVENE ANY REGISTRATION OR QUALIFICATION
REQUIREMENTS UNDER THE SECURITIES LAWS OF ANY SUCH JURISDICTION. NEITHER
THIS ANNOUNCEMENT NOR ANYTHING CONTAINED HEREIN SHALL FORM THE BASIS OF, OR BE
RELIED UPON IN CONNECTION WITH, ANY OFFER OR COMMITMENT WHATSOEVER IN ANY
JURISDICTION. THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION.
9 August 2024
EARNZ plc
("EARNZ" or the "Company")
Result of Placing
EARNZ plc (AIM: EARN), an AIM Rule 15 cash shell which is seeking acquisitions
in the energy services sector, is pleased to announce that it has
conditionally raised gross proceeds of approximately £2.05 million pursuant
to a placing, conducted via the accelerated bookbuild process announced
yesterday (the "Placing").
Conditionally, in aggregate, 27,351,450 new ordinary shares of 4p each in the
Company ("Ordinary Shares") will therefore be issued pursuant to the Placing
(the "Placing Shares") at an issue price of 7.5 pence per share (the "Placing
Price"). The Placing comprises both an EIS and VCT Placing (raising gross
proceeds of approximately £1.56 million) and and a Non-EIS and VCT Placing
(raising gross proceeds of approximately £0.49 million).
Shore Capital Stockbrokers Limited ("SCS") and Zeus Capital Limited ("Zeus")
acted as joint brokers and bookrunners in connection with the Placing.
Unless the context provides otherwise, capitalised terms used in this
announcement have the meanings given to them in the announcement of the
proposed fundraising released on 8 August 2024.
Directors' participation in the Placing
Certain of the Directors have subscribed for Placing Shares in the Placing,
which, in aggregate, amount to 879,999 Placing Shares at the Placing Price, as
set out below:
Name Position Number of Ordinary Shares held % of Existing Ordinary Shares held Number of Placing Shares subscribed for Resultant holding of Ordinary Shares on Second Admission % of Enlarged Share Capital
Bob Holt(1) Executive Chair 4,799,999 7.63% - 10,863,578 10.46%
Elizabeth Lake Chief Financial Officer 1,333,333 2.12% 333,333 1,666,666 1.60%
John Charlton Executive Director 466,666 0.74% 333,333 799,999 0.77%
Linda Main Non-Executive Director - - 200,000 200,000 0.19%
Sandra Skeete Non-Executive Director - - 13,333 13,333 0.01%
(1) Bob Holt's resultant holding on Second Admission includes Initial
Consideration Shares and the Bob Holt Loan Conversion Shares
Related Party Transactions
As Directors, the aggregate participation of Bob Holt in the Proposals, and
John Charlton, Elizabeth Lake, Linda Main and Sandra Skeete in the Non-EIS and
VCT Placing of 879,999 Placing Shares is a related party transaction pursuant
to AIM Rule 13. As there are no independent Directors for this transaction,
the Company's nominated adviser, Shore Capital and Corporate Limited ("SCC"),
considers that the terms of their participation in the Placing are fair and
reasonable insofar as the Company's shareholders are concerned.
Gresham House has agreed to subscribe for 18,731,826 Placing Shares. As at 8
August 2024, being the latest practicable date prior to the date of this
announcement, so far as the Company is aware, Gresham House holds 6,287,982
Existing Ordinary Shares representing 10.00 per cent. of the Existing Ordinary
Share Capital. As such, Gresham House is a substantial shareholder of the
Company and its participation in the Placing is a related party transaction
pursuant to AIM Rule 13. The Directors consider, having consulted with the
Company's nominated adviser, Shore Capital and Corporate, that the terms of
Gresham House's participation in the Placing are fair and reasonable insofar
as the Shareholders are concerned.
Concert Parties
Bob Holt is a common member of the Bob Holt Concert Party and the C&D
Concert Party and together they are known as the Existing Bob Holt Concert
Party. Separately, the SWHS Concert Party, which comprises only Andrew Custer,
is regarded as acting in concert for the purposes of the City Code, but is not
acting in concert with the Existing Bob Holt Concert Party.
The table below outlines the combined holding of the Existing Bob Holt Concert
Party at Second Admission and immediately following the issue of the
Additional Consideration Shares. Immediately following Second Admission, as
set out in the table below, members of the Existing Bob Holt Concert Party
will be interested in approximately 16.40 per cent. of the voting rights of
the Company. Following the issue of the Additional Consideration Shares, the
members of the Existing Bob Holt Concert Party will be interested, in
aggregate, in approximately 33.59 per cent. of the voting rights of the
Company (as set out in the table below assuming all Additional Consideration
Shares are issued at 4p per share). Following the exercise in full of the LTIP
awards to be granted to the Executive Directors (being Bob Holt, John Charlton
and Elizabeth Lake) on Second Admission, the members of the Existing Bob Holt
Concert Party will be interested, in aggregate, in approximately 36.75 per
cent. of the voting rights of the Company (as set out in the table below
assuming all Additional Consideration Shares are issued at 4p per share):
Shareholder % shareholding at Second Admission % shareholding after issue of Additional Consideration Shares % shareholding after exercise of LTIP options
Bob Holt((1)) 10.46% 14.78% 16.93%
Elizabeth Lake 1.60% 1.17% 2.07%
John Charlton((2)) 0.77% 0.56% 1.49%
Ian Currie 0.32% 0.23% 0.22%
James Holt 0.20% 0.15% 0.14%
Rachael Burnett 0.13% 0.09% 0.09%
Robert Holt 0.06% 0.05% 0.04%
William 0.06% 0.05% 0.04%
Holt
Sub-total Bob Holt Concert Party 13.62% 17.08% 21.03%
Zac Cosgrove 1.39% 8.25% 7.86%
Luke Drew 1.39% 8.25% 7.86%
Sub-total C&D Concert Party((3)) 13.24% 31.28% 32.65%
The Existing Bob Holt Concert Party Total 16.40% 33.59% 36.75%
((1)) Bob Holt's shareholding includes 0.09% of the Company's voting rights
held by his wife Angela Burnett. The balance of Bob Holt's shares is held in
his SSAS.
((2)) John Charlton's shareholding includes 0.09% of the Company's voting
rights held by his wife Catherine Charlton.(.)
((3)) This includes Bob Holt's shareholding.
Immediately following Second Admission, the SWHS Concert Party will be
interested in approximately 4.49 per cent. of the voting rights of the Company
(as set out in the table below). Following the issue of the Additional
Consideration Shares, the SWHS Concert Party will be interested in
approximately 8.57 per cent. of the voting rights of the Company (as set out
in the table below assuming all Additional Consideration Shares are issued):
Shareholder % shareholding at Second Admission % shareholding after issue of Additional Consideration Shares
Andrew Custer 4.49% 8.57%
Total 4.49% 8.57%
The above tables are based on the following assumptions:
· completion of: (i) each of the Acquisitions (resulting in the
issue of the Initial Consideration Shares and the Bob Holt Loan Conversion
Shares); and (ii) the Placing;
· the maximum number of Additional Consideration Shares capable
of being issued under the terms of the SPAs (as additional consideration
depending on the performance of the Acquisitions after Second Admission) are
allotted and issued to the relevant Sellers;
· the members of the Bob Holt Concert Party exercise all New
Options to which they are entitled in full at the earliest available
opportunity (being 29 August 2027); and
· there is no other issue of Ordinary Shares, or exercise of
other New Options.
Posting of Admission Document and General Meeting
The issue of the Placing Shares is conditional upon, inter alia, the passing
of the Resolutions to be proposed at the General Meeting.
An Admission Document will be posted later today containing a notice convening
the General Meeting to be held at the offices of Shore Capital, Cassini House,
57 St James's Street, London SW1A 1LD at 10.00 a.m. on 27 August 2024 to
consider the Resolutions.
The Board recommends that Shareholders vote in favour of the Resolutions to be
proposed and voted upon at the General Meeting, as they intend to do so in
respect of their aggregate beneficial shareholdings representing approximately
10.49 per cent. of the Existing Ordinary Share Capital.
Admission
Applications will be made for the Re-Admission of the Existing Ordinary Shares
and for the Admission of the New Ordinary Shares to be admitted to trading on
AIM. It is expected that First Admission will occur and that dealings will
commence in the EIS and VCT Placing Shares at 8.00 a.m. on 28 August 2024 and
that Re-Admission of the Existing Ordinary Shares and Second Admission will
occur and that dealings will commence in the Non-EIS and VCT Placing Shares,
the Initial Consideration Shares, the Bob Holt Loan Conversion Shares and
the Existing Ordinary Shares at 8.00 a.m. on 29 August 2024.
This announcement should be read in its entirety. In particular, you should
read and understand the information provided in the "Important Notices"
section of this announcement.
The person responsible for arranging the release of this Announcement on
behalf of EARNZ is John Charlton.
Enquiries:
EARNZ plc +44 (0) 7778 798 816
Bob Holt
Elizabeth Lake
John Charlton
Shore Capital - Nominated Adviser and Joint Broker +44 (0) 20 7408 4090
Tom Griffiths / Tom Knibbs / Lucy Bowden
Zeus Capital Limited - Joint Broker +44 (0) 20 7220 1666
Hugh Morgan / Antonio Bossi / Andrew de Andrade
IMPORTANT NOTICES
Shore Capital Stockbrokers Limited and Shore Capital and Corporate Limited
(together "Shore Capital") are authorised and regulated by the Financial
Conduct Authority (the "FCA") in the United Kingdom and are acting exclusively
for EARNZ and no one else in connection with the Proposals, and Shore Capital
will not be responsible to anyone (including any placees) other than EARNZ for
providing the protections afforded to its clients or for providing advice in
relation to the Proposals or any other matters referred to in this
Announcement.
Zeus Capital Limited is authorised and regulated by the FCA in the United
Kingdom and is acting exclusively for EARNZ and no one else in connection with
the Placing, and Zeus will not be responsible to anyone (including any
placees) other than EARNZ for providing the protections afforded to its
clients or for providing advice in relation to the Placing or any other
matters referred to in this Announcement.
No representation or warranty, express or implied, is or will be made as to,
or in relation to, and no responsibility or liability is or will be accepted
by the Joint Brokers or by any of their respective Representatives as to, or
in relation to, the accuracy or completeness of this Announcement or any other
written or oral information made available to or publicly available to any
interested party or its advisers, and any liability therefor is expressly
disclaimed.
The responsibilities of SCC as EARNZ's nominated adviser under the AIM Rules
for Nominated Advisers are owed solely to the London Stock Exchange and are
not owed to EARNZ or to any director of EARNZ or to any other person.
This Announcement may contain, or may be deemed to contain, "forward-looking
statements" with respect to certain of EARNZ's plans and its current goals and
expectations relating to its future financial condition, performance,
strategic initiatives, objectives and results. Forward-looking statements
sometimes use words such as "aim", "anticipate", "target", "expect",
"estimate", "intend", "plan", "goal", "believe", "seek", "may", "could",
"outlook" or other words of similar meaning. By their nature, all
forward-looking statements involve risk and uncertainty because they relate to
future events and circumstances which are beyond the control of EARNZ,
including amongst other things, United Kingdom domestic and global economic
business conditions, market-related risks such as fluctuations in interest
rates and exchange rates, the policies and actions of governmental and
regulatory authorities, the effect of competition, inflation, deflation, the
timing effect and other uncertainties of future acquisitions or combinations
within relevant industries, the effect of tax and other legislation and other
regulations in the jurisdictions in which EARNZ and its affiliates operate,
the effect of volatility in the equity, capital and credit markets on EARNZ's
profitability and ability to access capital and credit, a decline in EARNZ's
credit ratings; the effect of operational risks; and the loss of key
personnel. As a result, the actual future financial condition, performance and
results of EARNZ may differ materially from the plans, goals and expectations
set forth in any forward-looking statements. Any forward-looking statements
made in this Announcement by or on behalf of EARNZ speak only as of the date
they are made. Except as required by applicable law or regulation, EARNZ
expressly disclaims any obligation or undertaking to publish any updates or
revisions to any forward-looking statements contained in this Announcement to
reflect any changes in EARNZ's expectations with regard thereto or any changes
in events, conditions or circumstances on which any such statement is based.
No statement in this Announcement is intended to be a profit forecast or
estimate, and no statement in this Announcement should be interpreted to mean
that earnings per share of EARNZ for the current or future financial years
would necessarily match or exceed the historical published earnings per share
of EARNZ.
The Placing Shares have not been approved or disapproved by the US Securities
and Exchange Commission, any state securities commission or other regulatory
authority in the United States, nor have any of the foregoing authorities
passed upon or endorsed the merits of the Placing or the accuracy or adequacy
of this Announcement. Any representation to the contrary is a criminal offence
in the United States. The relevant clearances have not been, nor will they be,
obtained from the securities commission of any province or territory of
Canada, no prospectus has been lodged with, or registered by, the Australian
Securities and Investments Commission or the Japanese Ministry of Finance; the
relevant clearances have not been, and will not be, obtained from the South
Africa Reserve Bank or any other applicable body in the Republic of South
Africa in relation to the Placing Shares; and the Placing Shares have not
been, nor will they be, registered under or offered in compliance with the
securities laws of any state, province or territory of the United States,
Australia, Canada, the Republic of South Africa or Japan. 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 United States, Australia, Canada, the Republic of South Africa
or Japan or any other jurisdiction outside the United Kingdom or the EEA.
Neither the content of EARNZ's website nor any website accessible by
hyperlinks on EARNZ's website is incorporated in, or forms part of, this
Announcement.
Information to Distributors
UK product governance
Solely for the purposes of the product governance requirements contained
within Chapter 3 of the FCA Handbook Product Intervention and Product
Governance Sourcebook (the "UK Product Governance Requirements"), and
disclaiming all and any liability, whether arising in tort, contract or
otherwise, which any "manufacturer" (for the purposes of the UK Product
Governance Requirements) may otherwise have with respect thereto, the Placing
Shares have been subject to a product approval process, which has determined
that such securities are: (i) compatible with an end target market of
investors who meet the criteria of retail investors and investors who meet the
criteria of professional clients and eligible counterparties, each as defined
in paragraph 3 of the FCA Handbook Conduct of Business Sourcebook; and (ii)
eligible for distribution through all distribution channels (the "Target
Market Assessment"). Notwithstanding the Target Market Assessment,
distributors (for the purposes of UK Product Governance Requirements) should
note that: (a) the price of the Placing Shares may decline and investors could
lose all or part of their investment; (b) the Placing Shares offer no
guaranteed income and no capital protection; and (c) 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. The Target Market Assessment is
without prejudice to the requirements of any contractual, legal or regulatory
selling restrictions in relation to the Placing. Furthermore, it is noted
that, notwithstanding the Target Market Assessment, the Joint Brokers will
only procure investors who meet the criteria of professional clients and
eligible counterparties.
For the avoidance of doubt, the Target Market Assessment does not constitute:
(a) an assessment of suitability or appropriateness for the purposes of
Chapter 9A or 10A respectively of the FCA Handbook Conduct of Business
Sourcebook; 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.
EEA product governance
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 in
the European Economic Area (together, the "MiFID II Product Governance
Requirements"), and disclaiming all and any liability, whether arising in
tort, contract or otherwise, which any "manufacturer" (for the purposes of the
MiFID II 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 (a) retail investors, (b) investors who meet the criteria of
professional clients and (c) 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 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. The Target Market Assessment is without prejudice to the
requirements of any contractual, legal or regulatory selling restrictions in
relation to the Placing. Furthermore, it is noted that, notwithstanding the EU
Target Market Assessment, the Joint Brokers will only procure investors who
meet the criteria of professional clients and eligible counterparties.
For the avoidance of doubt, the EU Target Market Assessment does not
constitute: (a) an assessment of suitability or appropriateness for the
purposes of MiFID II; or (b) a recommendation to any investor or group of
investors to invest in, or purchase, or take any other action whatsoever with
respect to the Placing Shares.
Each distributor is responsible for undertaking its own target market
assessment in respect of the Placing Shares and determining appropriate
distribution channels.
PLACING AND ADMISSION STATISTICS
Placing Price 7.5p
Number of Existing Ordinary Shares 62,879,828
Number of EIS and VCT Placing Shares 20,798,491
Percentage of Enlarged Share Capital represented by the EIS and VCT Placing 20.03%
Shares
Number of Ordinary Shares in issue immediately following First Admission 83,678,319
Aggregate number of Initial Consideration Shares and Bob Holt Loan Conversion 13,616,909
Shares to be issued by the Company
Percentage of Enlarged Share Capital represented by the Initial Consideration 13.11%
Shares and the Bob Holt Loan Conversion Shares
Number of Non-EIS and VCT Placing Shares 6,552,959
Percentage of Enlarged Share Capital represented by the Non-EIS and VCT 6.31%
Placing Shares
Aggregate number of Placing Shares to be issued by the Company 27,351,450
Percentage of Enlarged Share Capital represented by the Placing Shares 26.34%
Percentage of Enlarged Share Capital represented by the Existing Ordinary 60.55%
Shares
Number of Ordinary Shares in issue immediately following Re-Admission and 103,848,187
Second Admission
Market capitalisation of the Enlarged Group at the Placing Price immediately £7.79 million
following Re-Admission and Second Admission
Percentage of Enlarged Share Capital held by holders of Existing Ordinary 60.55%
Shares following Second Admission
Gross proceeds of the EIS and VCT Placing £1.56 million
Gross proceeds of the Non-EIS and VCT Placing £0.49 million
Total gross proceeds of the Placing £2.05 million
Estimated expenses of the Proposals £1.3 million
ISIN Code GB00BRC2TB67
SEDOL number BRC2TB6
LEI 213800YWMHGTNXCWZC33
AIM TIDM EARN
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