REG - EQTEC PLC - Notice of EGM
24/11/2023 07:00
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RNS Number : 5246U EQTEC PLC 24 November 2023
24 November 2023
EQTEC plc
("EQTEC", the "Company" or the "Group")
Notice of Extraordinary General Meeting (the "EGM")
Proposed Capital Reorganisation and Share Consolidation
EQTEC plc (AIM: EQT), a global technology innovator powering distributed,
decarbonised, new energy infrastructure through its waste-to-value solutions
for hydrogen, biofuels, and energy generation, announces that, further to its
announcement on 20 November 2023 (the "Announcement"), a circular (the
"Circular") is being sent to shareholders today.
The Circular contains a notice of EGM to approve the capital reorganisation
proposed by the Company in the Announcement (the "Capital Reorganisation").
The EGM will be held at the offices of Philip Lee LLP, Connaught House, One
Burlington Road, Dublin 4, D04 C5Y6, Ireland at 12.00 noon on Monday, 18
December 2023.
A copy of the Circular and a notice of the EGM (the "Notice") will be
available on the Company's website: www.eqtec.com (http://www.eqtec.com) later
today.
Extracts from the Circular and defined terms are set out below.
ENQUIRIES
EQTEC plc +44 20 3883 7009
David Palumbo / Jeffrey Vander Linden
Strand Hanson - Nomad & Financial Adviser +44 20 7409 3494
James Harris / Richard Johnson
Global Investment Strategy UK Ltd - Broker +44 20 7048 9045
Samantha Esqulant
Fortified Securities - Broker +44 20 3411 7773
Guy Wheatley
Panmure Gordon - Broker +44 20 7886 2500
John Prior / Hugh Rich
Introduction
The purpose of this document is to provide details regarding the Capital
Reorganisation and explain why the Board believes this is in the best
interests of EQTEC plc and its shareholders.
The Capital Reorganisation is conditional on, among other things, the passing
of the Resolutions by Shareholders at the Extraordinary General Meeting, which
is scheduled to take place at 12:00 noon on 18 December 2023. The formal
Notice of Extraordinary General Meeting is set out at the end of this document
(together with a set of explanatory notes) and a form of proxy is also
enclosed for you to complete, sign and return.
The Board considers that the Capital Reorganisation is in the best interests
of the Shareholders taken as a whole and unanimously recommends that
Shareholders vote in favour of the Resolutions to be proposed at the
Extraordinary General Meeting. Failure to approve the proposed Resolutions may
constitute an event of default under certain facilities included in the
refinancing announced on 20 November 2023 following which (as with the case
of other standard events of default) the lenders of such facilities may
declare all outstanding amounts immediately due and payable.
Background and reasons for the Capital Reorganisation
The Company has previously announced its business strategy of moving out of
project development and into pure-play technology licensing and innovation.
The Company's strategy emphasises: (1) continuously developing and leveraging
its IP-rich engineering and innovation capabilities; (2) de-risking its
portfolio by occupying a narrow segment of the value chain, collaborating with
the world's best value chain partners; and (3) driving higher margins through
licensing its IP for use by owner-operators, deploying its engineering and
design capabilities to get its IP deployed into more places, for the
best-suited business models.
In its recent 2023 Interim Results the Board announced it is conducting a
review of available options for required investment, with a particular focus
on long-term, strategic investors of sufficient scale and resources to support
the Company's growth and execution of its strategic vision. To facilitate
engagement with prospective investors, the Company has, together with its
advisors, including a major investment bank announced by the Company in
February 2023, established a 10-year business plan built around its declared
strategy.
On 20 November 2023 the Company announced a proposed financial restructuring,
in collaboration with its existing funders and certain key shareholders, to
enable the Company to transition to revenue-led growth and regain momentum
with execution of its business strategy. Certain aspects of the refinancing
are subject to Shareholders passing resolutions to provide the Company with
authority to issue new Ordinary Shares and the implementation of a share
capital reorganisation. As a condition subsequent to part of the refinancing
announced on 20 November 2023, the Company must hold the EGM by 3 January 2024
to seek approval from its Shareholders to implement a share capital
reorganisation to reduce the nominal value of its Ordinary Shares and to
refresh the Company's authority to allot shares.
Shareholder approval is therefore being sought for a reorganisation of the
Company's share capital, comprising the subdivision, consolidation and a part
redesignation of the existing Ordinary Shares. Each Shareholder's
proportionate interest in the issued Ordinary Shares of the Company (save for
rounding to avoid fractional entitlements) will remain unchanged as a result
of the Capital Reorganisation.
The Capital Reorganisation is proposed in order to achieve a higher market
price for the Consolidated Ordinary Shares to a more appropriate range for the
Company. The Board believes that the Capital Reorganisation will improve the
marketability of the Ordinary Shares by way of a higher share price and hopes
to reduce volatility in the Company's share price by narrowing the spread of
its bid and offer price. In addition, if the Capital Reorganisation was not
implemented, the Company is prohibited from allotting shares at a discount to
their nominal value, and this is addressed by the Capital Reorganisation.
The authorised share capital of the Company is €213,200,000 divided into
25,761,091,094 Ordinary Shares of €0.001 each, 10,000,000,000 Deferred
Convertible A Ordinary Shares of €0.01 each, 75,140,494 Deferred B Ordinary
Shares of €0.099 each and 200,000,000 Deferred Ordinary Shares of €0.40
each.
As at the date of this document, the Company has 14,783,204,492 Ordinary
Shares in issue, with a closing mid-market price of 0.0425p per Ordinary Share
(as at 20 November 2023, being the latest practicable Business Day prior to
the date of this document).
The Capital Reorganisation will involve the following three inter-conditional
steps: (1) the subdivision of existing Ordinary Shares; (2) the consolidation
of the resulting Ordinary Shares; and (3) the redesignation of certain of the
remaining Ordinary Shares.
(1) Ordinary Share Subdivision
The current nominal value of each of the existing Ordinary Shares is
€0.001. Pursuant to the proposed subdivision, each existing Ordinary Share
would be subdivided into 10 Ordinary Shares of €0.0001, from the time at
which the Resolution in respect of the subdivision becomes effective (which
will be immediately prior to the Ordinary Share Consolidation and
Redesignation).
(2) Ordinary Share Consolidation
Immediately after the subdivision of the Ordinary Shares every 1,000 (one
thousand) subdivided Ordinary Shares of €0.0001 each will be consolidated
into 10 (ten) Ordinary Shares of €0.01 each
(3) Redesignation
Immediately after the Ordinary Share Consolidation 9 (nine) out of every 10
Ordinary Shares of €0.01 each will be redesignated into 9 (nine) deferred C
ordinary shares of €0.01 each ("2023 Deferred Shares").
Shareholders should note that, except for the increase in nominal value of
each Ordinary Share, the voting and dividend rights attaching to the New
Ordinary Shares arising on the Capital Reorganisation will be identical in all
respects to those attaching to the existing Ordinary Shares at the date of
this document. The 2023 Deferred Shares will have no economic value and will
carry the rights as set out in the Amended Articles and as summarised below.
If the Capital Reorganisation is approved, the New Ordinary Shares will be
admitted to trading on AIM on 19 December 2023.
No new share certificates representing the New Ordinary Shares will be sent to
Shareholders who hold Existing Ordinary Shares in certificated form.
Accordingly, share certificates for the Existing Ordinary Shares will remain
valid, and will only be replaced by share certificates for New Ordinary Shares
when the old share certificates are surrendered for cancellation following the
transfer, transmission or other disposal of New Ordinary Shares.
Shareholders who hold their Existing Ordinary Shares in uncertificated form
through CREST should expect to see the security description updated, in order
to reflect their holding in New Ordinary Shares.
Following the Share Consolidation, the Company's new SEDOL code will be
BLF9HQ3 and its new ISIN code will be IE000955MAJ1.
The 2023 Deferred Shares created will be effectively valueless as they will
not carry any rights to vote or dividend rights. In addition, holders of 2023
Deferred Shares will not be entitled to a payment on a return of capital or on
a winding up of the Company. The 2023 Deferred Shares will not be traded on
AIM or listed and will not be transferable other than as specified in the
Amended Articles.
No share certificates will be issued in respect of the 2023 Deferred Shares,
nor will CREST accounts of Shareholders be credited in respect of any
entitlement to 2023 Deferred Shares.
In connection with the Capital Reorganisation, the Company is also required to
amend the Existing Articles to reflect the amended authorised share capital of
the Company and include the specific rights and restrictions attaching to the
2023 Deferred Shares, as set out above.
Application will be made in accordance with the AIM Rules for the New Ordinary
Shares arising from the Capital Reorganisation to be admitted to trading on
AIM, subject to Shareholders passing Resolutions at the EGM. It is expected
that if such Resolutions are passed, Admission in respect of such New Ordinary
Shares will become effective and that dealings in those New Ordinary Shares
will commence on 19 December 2023.
No Shareholder will be entitled to a fraction of a new Ordinary Share or 2023
Deferred Share. Instead, their entitlement will be rounded down to the nearest
whole number of New Ordinary Shares and Deferred Shares. Remaining fractional
entitlements to New Ordinary Shares and Deferred Shares will be aggregated and
sold on behalf, and for the benefit of, the Company. As a result of the
Ordinary Share Consolidation existing shareholdings will effectively be
divided by 100. If a Shareholder holds fewer than 100 Existing Ordinary
Shares at the Record Date, then the rounding down process will result in that
Shareholder being entitled to zero New Ordinary Shares and as a result of the
Capital Reorganisation they will cease to hold any Ordinary Shares.
Extraordinary General Meeting
Set out at the end of this document is a notice convening the Extraordinary
General Meeting to be held on 18 December 2023 at 12.00 a.m. in the offices
of Philip Lee LLP, Connaught House, One Burlington Road, Dublin 4, D04 C5Y6
, Ireland at which the Resolutions will be proposed.
Shareholders wishing to vote but who are unable to attend the Extraordinary
General Meeting in person, are urged to appoint the Chairman of the meeting as
their proxy, in accordance with the relevant instructions on the form of
proxy, and to submit their form of proxy so as to be received as soon as
possible and by no later than 12:00 a.m. on 16 December 2023. This will ensure
that your vote will be counted even if you are unable to attend in person.
Resolutions
A summary of the resolutions to be proposed at the Extraordinary General
Meeting is set out below. Please note that this is not the full text of the
Resolutions and you should read this section in conjunction with the
Resolutions contained in the formal notice at the end of this document
(together with the explanatory notes set out at the end of such notice).
The following resolutions, which are all inter dependent, will be proposed at
the Extraordinary General Meeting:-
Resolution 1, which will be proposed as an ordinary resolution seeks
shareholder authority to approve the Sub-division.
Resolution 2, which will be proposed as an ordinary resolution, seeks
shareholder authority to approve the Ordinary Share Consolidation.
Resolution 3, which will be proposed as a special resolution, seeks
shareholder authority to approve the Redesignation.
Resolution 4, which will be proposed as a special resolution, in order to give
effect to the foregoing, seeks shareholder authority to adopt as the
memorandum and articles of association of the Company the draft memorandum and
articles of association produced to the meeting and initialled by the Chairman
of the meeting for the purposes of identification.
Resolution 5, which will be proposed as an ordinary resolution, to authorise
the Directors to issue Ordinary Shares up to an aggregate nominal value equal
to €4,500,000. This authority shall expire at the close of business on the
date of the next AGM of the Company unless previously renewed, varied or
revoked by the Company.
As a special resolution, Resolution 3 and 4 require votes in favour
representing 75 per cent. or more of the votes cast (in person or by proxy) at
the Extraordinary General Meeting in order to be passed.
Action to be taken by Shareholders
A form of proxy for use at the Extraordinary General Meeting is enclosed.
Whether or not you intend to be present at the Extraordinary General Meeting,
you are requested to complete, sign and return the form of proxy in accordance
with the instructions thereon.
For Shareholders whose name appears on the register of members of the Company
(being those who hold their shares in certificated form), your proxy may be
submitted by post, and returning it to the Company's Registrar Link Registrars
Limited at P.O. Box 7117, Dublin 2, Ireland (if delivered by post) or at Link
Registrars Limited, Suite 149, The Capel Building, Mary's Abbey, Dublin 7, D07
DP79, Ireland (if delivered by hand) so as to arrive no later than 12.00 noon
on 16 December 2023. The return of the form of proxy will not prevent you from
attending the Extraordinary General Meeting and voting in person should you
wish to do so.
Persons who hold their interests in ordinary shares as Belgian law rights
through the Euroclear system or as CDIs should consult with their custodian,
stockbroker or other intermediary at the earliest opportunity for further
information on the processes and timelines for submitting proxy votes for the
EGM through the respective systems. For voting services offered by custodians
holding Irish corporate securities directly with Euroclear Bank SA/NV
("Euroclear Bank"), please contact your custodian.
To be effective, all proxy voting instructions (whether submitted directly or
through the EB System or CREST) together with any power of attorney or other
authority under which it is executed, or a notarially certified copy thereof,
must be received by the Company's Registrars, no later than 12.00 noon. on 16
December 2023. However, persons holding through the EB System or CREST will
also need to comply with any additional voting deadlines imposed by the
respective service offerings. All relevant persons are recommended to consult
with their stockbroker or other intermediary at the earliest opportunity.
Board Recommendations
The Directors consider that all the proposals to be considered at the
Extraordinary General Meeting are in the best interests of the Company and its
shareholders as a whole and are most likely to promote the success of the
Company. Failure to approve the proposed Resolutions may constitute an event
of default under certain facilities included in the refinancing announced on
20 November 2023 following which (as with the case of other standard events
of default) the lenders of such facilities may declare all outstanding amounts
immediately due and payable. Accordingly, the Directors unanimously recommend
that you vote in favour of the Resolutions to be proposed at the Extraordinary
General Meeting as they intend to do in respect of their own beneficial
holdings currently amounting to approximately 3.05 per cent. of the issued
share capital of the Company.
The results of the voting on all Resolutions will be announced via a
Regulatory Information Service and published on our website as soon as
practicable following the conclusion of the Extraordinary General Meeting.
DEFINITIONS
In this document and in the Form of Proxy the following expressions have the
following meanings.
"AIM" the AIM market of the London Stock Exchange;
"AIM Rules" the rules for AIM companies and their nominated advisers issued by the London
Stock Exchange governing the admission to and the operation of AIM;
"Articles of Association" or "Articles" the articles of association of the Company as amended from time to time and
filed with the Registrar of Companies;
"Amended Articles" the articles of association of the Company as amended following the passing of
Resolutions 1 and 2 at the EGM to approve the Capital Reorganisation;
"Business Day" a day (other than Saturdays, Sundays, public holidays or bank holidays) on
which banks are generally open for normal business in Ireland;
the reorganisation of the Company's share capital in the matter proposed in
"Capital Reorganisation" section 2 of the Chairman's Letter and effected by Resolutions 1-3;
"Circular" or "Document" this document dated 24 November 2023 containing information about the Capital
Reorganisation, the Resolutions and the Notice of Extraordinary General
Meeting
"Company" or "EQTEC" EQTEC plc;
"Companies Act" the Companies Act 2014 of Ireland as amended;
"2008 Deferred Shares" the Deferred Convertible A Ordinary Shares of €0.01 each in the Company
having the rights set out in the Existing Articles;
"2013 Deferred Shares" the Deferred Ordinary Shares of €0.40 each in the Company having the rights
set out in the Existing Articles;
"2017 Deferred Shares" the Deferred B Ordinary Shares of €0.099 each in the Company having the
rights set out in the Existing Articles;
"2023 Deferred Shares" the Deferred C Ordinary Shares of €0.10 each in the Company arising from the
Capital Reorganisation and having the rights set out in the Amended Articles;
"Existing Articles" the articles of association of the Company as at the date of this document;
"Existing Ordinary Shares" the 14,783,204,492ordinary shares of €0.001 each in the capital of the
Company in issue as at the date of this document (being the entire issued
ordinary share capital of the Company);
"Extraordinary General Meeting" or "EGM" the extraordinary general meeting of the Company convened for 18 December 2023
to approve the Resolutions;
"EUI" Euroclear UK & International Limited, the operator of the CREST System;
means the form of proxy for use at the General Meeting which accompanies this
document;
"Form of Proxy"
"GBP" the lawful currency of the United Kingdom;
"Group" or "EQTEC Group" the Company and its subsidiary undertakings;
"Ireland" Ireland, excluding for the avoidance of doubt, Northern Ireland;
"Link" or "Registrars" Link Registrars Limited, the Company's registrars, who have their registered
office at Suite 149, The Capel Building, Mary's Abbey, Dublin 7, D07 DP79,
Ireland;
"London Stock Exchange" London Stock Exchange plc;
"New Ordinary Shares" the new ordinary shares of nominal value €0.01 each in the capital of the
Company to be created pursuant to the Capital Reorganisation;
"Ordinary Share Consolidation" following the Subdivision, the consolidation of the Ordinary Shares of
€0.0001 each, into Ordinary Shares of €0.01 each, as described in section
2 of the Chairman's Letter and effected by Resolution 2.
"Ordinary Shares" the ordinary shares of €0.001 each in the capital of the Company or, as the
context requires, ordinary shares of €0.0001 each in the capital of the
Company or, as the context requires, ordinary shares of €0.01 each in the
Capital of the Company where Ordinary Shares are in issue or to be issued,
post the Capital Reorganisation.
"Record Date" 6.00 p.m. on 18 December 2023 or such other date as the Directors may
determine, being the date by reference to which the Ordinary Share
Consolidation is calculated;
"Redesignation" following the Subdivision and the Ordinary Share Consolidation the
redesignation of 9 (nine) out of every 10 Ordinary Shares of €0.01 each into
9 (nine) 2023 Deferred Shares, as described in section 2 of the Chairman's
Letter and effected by Resolution 3;
"Resolutions" the shareholder resolutions to be voted upon by Shareholders at the EGM;
"Restricted Jurisdiction" the United States, Australia, Canada, Japan, New Zealand and the Republic of
South Africa and any other jurisdiction in which it would be unlawful to
distribute the document and would be required to be approved by a regulatory
body;
"Sub-division" means the subdivision of the Ordinary Shares as described in Section 2 of the
Chairman's Letter and effected by Resolution 1;
"Shareholders" holders of shares (of any class) in the capital of the Company;
"UK" or "United Kingdom" the United Kingdom of Great Britain and Northern Ireland; and
"UK Listing Authority" or "UKLA" the Financial Conduct Authority acting in its capacity as the competent
authority for the purposes of Part VI of the Financial Services and Markets
Act 2000.
SHARE CONSOLIDATION STATISTICS
Number of Existing Ordinary Shares 14,783,204,492
Number of New Ordinary Shares to be in issue
immediately following completion of the Capital Reorganisation 147,832,044
Number of 2023 Deferred Shares to be in issue immediately following completion
of the Capital Reorganisation
1,330,488,404
New ISIN Code following the Share Consolidation IE000955MAJ1
New SEDOL Code following the Share Consolidation BLF9HQ3
TIDM EQT
EXPECTED TIMETABLE OF PRINCIPAL EVENTS
Date of this Document and Form of Proxy
24 November 2023
Latest time and date for receipt of Forms of Proxy 12.00 a.m. on 16 December 2023
Extraordinary General Meeting 12.00 a.m. on 18 December 2023
Announcement of the Results of the Extraordinary General 18 December 2023
Meeting
Record date for Ordinary Share Consolidation 6.00p.m. on 18 December2023
Admission effective and dealings commence in the New Ordinary Shares and start of business on 19 December 2023
Credit of Euroclear Bank Participant Accounts and CREST Member accounts (where
applicable)
Note
(1) Unless otherwise stated, all references in this document are to Dublin
time. The dates given are based on the Directors expectations and may be
subject to change. Any change to the timetable will be notified to the London
Stock Exchange and to the market via a regulatory announcement.
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