REG - Kelso Group Holdings - THG Update, Proposed Placing and Board Changes

Kelso groupAnnouncement

30/03/2023 07:00

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RNS Number : 6997U  Kelso Group Holdings PLC  30 March 2023

30 March 2023

 

Kelso Group Holdings Plc ("Kelso" or the "Company")

 

Recommendations on THG Plc ("THG"), THG Investment Update, Proposed Placing
and Board Changes

 

Kelso, the main market listed investment company, is pleased to announce:

 

·    recommendations following further analysis into THG;

·    a net purchase of a beneficial interest in an additional 2.4 million
shares in THG, which takes Kelso's total beneficial interest, consisting of
ordinary shares and CFDs, in THG to 7.4 million shares;

·    a proposed placing at a price of 2.5 pence, a 25% premium to the
offer for subscription concluded in January 2023, to raise a maximum of £3.0
million (before expenses) ("Proposed Placing"); and

·    the appointment of David Charters as a Non-Executive Director.

 

Recommendations

Kelso has continued its analysis into THG, including, amongst other actions, a
hosted visit to THG's operations in Manchester and Warrington. We believe that
2023 will be a positive year for THG as many of the operational headwinds
experienced during 2022 continue to reverse. Whilst we commend THG's board and
management's efforts, we believe there are more actions they can take to
ensure the share price reflects what we strongly believe to be intrinsic
value. Specifically, we would like to see the board deliver on commitments
made to investors. We urge the board to implement the following readily
achievable measures which we believe will be positive for THG's share price.

1.    Kelso considers that the transition of THG from the Standard List to
the Premium List of the London Stock Exchange ("LSE") would be significantly
accretive to shareholder value. The performance of most active and indexed UK
funds is benchmarked to the Premium Index and therefore they can ignore
companies listed on the Standard Index. In October 2021, THG announced its
intention to apply to move from the Standard List to the Premium List of the
LSE by the end of 2022. However, in their Interim Results announced in
September 2022, THG indicated that the timing of the move depended on the
FCA's review for listing regime reform, anticipated in 2023. Kelso recommends
that THG provide the market with a progress update on the transition with a
specific timeline. Importantly, we believe this move should be completed as
soon as possible, irrespective of the timing of the FCA's review.

 

2.    We urge THG to continue to review strategic options, alongside
focussing on cash generation, to ensure underlying value is realised in a
practicable timeframe. Initially, for the market to better understand the
value potential of THG, it is important that they provide the appropriate
detailed segmental analysis, specifically including divisional
contribution/profitability, alongside a divisional summary of any tax losses.
It is Kelso's view that there is a clear path to enhancing shareholder value
through more financial visibility, which we hope is detailed in the pending
results, by highlighting the underlying value based on the "sum of the parts".
We note that Liberum, an independent broker, in their research note published
in February 2023, estimated the "sum of the parts" to be 221 pence per share
(actual price target was 55p) but highlighted that this valuation is only
relevant if appropriate actions are taken by management and the board, a
comment with which we agree.

 

3.    Given, in our view that THG's share price is undervalued, we urge THG
to consider a share buyback programme soon after the pending preliminary
results announcement. We note that THG maintains the authority to buyback up
to 10% of its outstanding shares. As stated in the January 2023 trading
statement, THG has cash on hand at year end of c.£470 million, with £170
million undrawn revolving credit facility, net debt of c.£200 million,
reducing to c.£160 million upon receipt of £40 million of proceeds from
non-core freehold asset disposals in H1 2023. Tailwinds from recent whey and
transportation cost reductions will further improve cash generation. We think
such a buyback would demonstrate the board's confidence in the business.

 

4.    Finally, Kelso believes that THG's relationship and communications
with the investment community needs reinvigorating to improve the general
understanding of the potential of its business. This is especially pertinent
when combined with the move to the Premium List. Whilst we note the
high-quality core shareholder base, the shareholder register could be improved
significantly by attracting more mainstream UK and global equity funds.
Already in 2023, THG has achieved some major commercial accomplishments such
as a burgeoning relationship with Iceland, which exemplifies the brand value
of MyProtein, the formalisation of a technology partnership with Autostore,
the increased presence in several large German retailers and the move into the
gym sector. Whilst these achievements have been communicated through social
media platforms such as LinkedIn, we believe deals of such commercial
significance should also be communicated directly to current and potential THG
investors via the Regulatory News Service ("RNS"), specifically RNS Reach
which was introduced as a service to improve listed company communication with
its shareholders.

 

THG investment update

Kelso is pleased to announce a net purchase of a beneficial interest in an
additional 2.4 million shares in THG, which takes Kelso's total beneficial
interest, consisting of ordinary shares and CFDs, in THG to 7.4 million
shares.

 

Proposed Placing, conditional on shareholder approval

Kelso announces its intention to conduct a non pre-emptive placing, of up to
£3.0 million (before expenses) at a placing price of 2.5 pence, of new
ordinary shares in the capital of the Company, subject to approval by
shareholders and of an FCA approved prospectus. Kelso will today begin to
speak to its shareholders and other interested parties and expects to close
the Proposed Placing during April. An update on the expected admission date
will be provided in due course.

 

All of the directors intend to subscribe for shares in the Proposed Placing.
John Goold and Jamie Brooke intend to subscribe for £300,000 and £75,000 of
shares in the Proposed Placing, respectively.

 

Kelso will use the proceeds from the Proposed Placing (after expenses) to
continue to execute its mandate to engage and unlock trapped value in the UK
stock market.

 

In April, Kelso will announce its annual results for the year ended 31
December 2022 and the closing of the Proposed Placing and a date for the AGM,
at which it intends to seek approval for the Proposed Placing.

 

Kelso is keeping costs to a minimum and specifically the Board continues to
receive no fees or salaries. Alongside the annual results announcement, as
previously stated, Kelso will also announce the details of a management
incentive plan aligned with long term shareholder value creation, having been
advised by BDO.

 

The Appendix to this Announcement (which forms part of this Announcement)
contains the detailed terms and conditions of the Placing.

 

Change of Non-Executive Director

Kelso is delighted to appoint David Charters as a Non-Executive Director with
immediate effect. David is a former diplomat turned investment banker, venture
capitalist and author. He was previously a Director of SG Warburg Securities
and a Managing Director of Deutsche Bank. Today he sits on a number of boards
mostly in the finance, security and business intelligence sectors, as well as
in the charity and not for profit world.

 

At the same time, with immediate effect, Gordon Harvey will step down as a
director having served on the board since the original IPO. Kelso is grateful
to Gordon for his efforts in assisting the Company to this stage.

 

John Goold, CEO of Kelso commented:

'Mark, Jamie and I, with the support of our board, continue to be excited
about the prospects for Kelso over the long term and are delighted to announce
today a c.50% increase in our interest in THG shares. The current stock market
conditions suit our strategy of finding undervalued situations where we
believe through our focused efforts, we can help unlock value. We continue to
believe that THG represents a great opportunity to make significant returns
for Kelso shareholders.'

 

 

For further information please contact:

 

Kelso Group Holdings Plc
 
+44 (0) 75 4033 3933

John Goold, Chief Executive Officer

Mark Kirkland, Chief Financial Officer

Jamie Brooke, Chief Investment Officer

 

Zeus (Broker)
 
+44 (0) 20 3829 5000

Nick Cowles, Matt Hogg (Investment Banking)

Ben Robertson (Corporate Broking)

 

About Kelso

Kelso was established in 2022 to identify, engage and unlock trapped value in
the UK stock market. Kelso's strategy is to invest in situations where there
is an anomaly between the intrinsic value and prospects of a company and its
stock market valuation. Kelso will look for situations where it believes the
sum of the parts of a business is greater than the current value. The Company
completed a fundraising of £3.0 million in January 2023. Kelso believes that
the current market conditions are such that there are situations where UK
listed companies' valuations are not appropriately matched to their underlying
intrinsic value. There may be instances where Kelso itself could be used as a
vehicle by an undervalued company to spin off a subsidiary into its own
listing. Such a transaction would undoubtedly constitute a reverse takeover
for Kelso.

 Appendix

 

Notice to overseas persons

 

This announcement does not constitute, or form part of, a prospectus relating
to the Company, nor does it constitute or contain any invitation or offer to
any person, or any public offer, to subscribe for, purchase or otherwise
acquire any shares in the Company or advise persons to do so in any
jurisdiction, nor shall it, or any part of it form the basis of or be relied
on in connection with any contract or as an inducement to enter into any
contract or commitment with the Company.

 

This announcement is not for release, publication or distribution, in whole or
in part, directly or indirectly, in or into Australia, Canada, Japan or any
jurisdiction into which the publication or distribution would be unlawful.
This announcement is for information purposes only and does not constitute an
offer to sell or issue or the solicitation of an offer to buy or acquire
shares in the capital of the Company in Australia, Canada, Japan, New Zealand,
or any jurisdiction in which such offer or solicitation would be unlawful or
require preparation of any prospectus or other offer documentation or would be
unlawful prior to registration, exemption from registration or qualification
under the securities laws of any such jurisdiction. Persons into whose
possession this announcement comes are required by the Company to inform
themselves about, and to observe, such restrictions.

 

This announcement is not for publication or distribution, directly or
indirectly, in or into the United States. This announcement is not an offer of
securities for sale into the United States, or to, or for the account or
benefit of U.S. Persons or persons in the United States. The securities
referred to herein have not been and will not be registered under the
Securities Act or the securities laws of any state or other jurisdictions of
the United States and may not be offered or sold in the United States, or to,
or for the account or benefit of U.S. Persons or persons in the United States.
Each placee will be required to warrant that it and any account with respect
to which it exercises investment discretion is outside the United States and
is not a U.S. Person.

 

General

 

Zeus is authorised and regulated by the Financial Conduct Authority (the
"FCA") in the United Kingdom and is acting exclusively for the Company and no
one else in connection with the Proposed Placing process and the Proposed
Placing will not regard anyone (including any placees) (whether or not a
recipient of this Announcement) as a client, and will not be responsible to
anyone other than the Company for providing the protections afforded to its
clients or for providing advice in relation to the Proposed Placing or any
other matters referred to in this Announcement.

 

This Announcement has been issued by, and is the sole responsibility of the
Company. No representation or warranty, express or implied, is or will be made
as to, or in relation to, and no responsibility or liability is or will be
accepted by Zeus or by any of its affiliates or agents as to, or in relation
to, the accuracy or completeness of this Announcement or any other written or
oral information made available to or publicly available to any interested
party or its advisers, and any liability therefor is expressly disclaimed.

 

Neither the content of the Company's website (or any other website) nor any
website accessible by hyperlinks on the Company's website (or any other
website) or any previous announcement made by the Company is incorporated in,
or forms part of, this Announcement.

 

TERMS AND CONDITIONS OF THE PLACING

IMPORTANT INFORMATION ON THE PLACING FOR INVITED PLACEES ONLY.

MEMBERS OF THE PUBLIC ARE NOT ELIGIBLE TO TAKE PART IN THE PLACING. THIS
ANNOUNCEMENT AND THE TERMS AND CONDITIONS SET OUT IN THIS APPENDIX ("TERMS AND
CONDITIONS") ARE DIRECTED ONLY AT PERSONS WHOSE ORDINARY ACTIVITIES INVOLVE
THEM IN ACQUIRING, HOLDING, MANAGING AND DISPOSING OF INVESTMENTS (AS
PRINCIPAL OR AGENT) FOR THE PURPOSES OF THEIR BUSINESS AND WHO HAVE
PROFESSIONAL EXPERIENCE IN MATTERS RELATING TO INVESTMENTS AND ARE (A) IF IN A
MEMBER STATE OF THE EUROPEAN ECONOMIC AREA (THE "EEA"), PERSONS WHO ARE
QUALIFIED INVESTORS ("EEA QUALIFIED INVESTORS"), BEING PERSONS FALLING WITHIN
THE MEANING OF ARTICLE 2(E) OF PROSPECTUS REGULATION (EU) 2017/1129 (THE
"PROSPECTUS REGULATION"); OR (B) IF IN THE UNITED KINGDOM, EITHER (I) PERSONS
WHO ARE QUALIFIED INVESTORS ("UK QUALIFIED INVESTORS"), BEING PERSONS FALLING
WITHIN THE MEANING OF ARTICLE 2(E) OF PROSPECTUS REGULATION (EU) 2017/1129 AS
IT FORMS PART OF DOMESTIC LAW BY VIRTUE OF THE EUROPEAN UNION (WITHDRAWAL) ACT
2018 (THE "UK PROSPECTUS REGULATION") (AND WHO ARE ALSO EITHER (a) PERSONS
FALLING WITHIN THE DEFINITION OF "INVESTMENT PROFESSIONAL" IN ARTICLE 19(5) OF
THE FINANCIAL SERVICES AND MARKETS ACT 2000 (FINANCIAL PROMOTION) ORDER 2005,
AS AMENDED (THE "ORDER"), OR (b) PERSONS WHO FALL WITHIN ARTICLE 49(2)(A) TO
(D) (HIGH NET WORTH COMPANIES, UNINCORPORATED ASSOCIATIONS, ETC) OF THE
ORDER), OR (II) PERSONS WHO ARE IN RECEIPT OF THE OFFER IN ACCORDANCE WITH
ARTICLE 1(4)(b) OF THE UK PROSPECTUS REGULATION (AND WHO ARE ALSO PERSONS WHO
FALL WITHIN ARTICLE 43 OF THE ORDER (MEMBER AND CREDITORS OF CERTAIN BODIES
CORPORATE)), OR (III) ARE PERSONS TO WHOM IT MAY OTHERWISE BE LAWFULLY
COMMUNICATED. (ALL SUCH PERSONS TOGETHER BEING REFERRED TO AS "RELEVANT
PERSONS"). THIS ANNOUNCEMENT AND THE TERMS AND CONDITIONS SET OUT HEREIN MUST
NOT BE ACTED ON OR RELIED ON BY PERSONS WHO ARE NOT RELEVANT PERSONS. PERSONS
DISTRIBUTING THIS ANNOUNCEMENT MUST SATISFY THEMSELVES THAT IT IS LAWFUL TO DO
SO. ANY INVESTMENT OR INVESTMENT ACTIVITY TO WHICH THIS APPENDIX AND THE TERMS
AND CONDITIONS SET OUT HEREIN RELATE IS AVAILABLE ONLY TO RELEVANT PERSONS AND
WILL BE ENGAGED IN ONLY WITH RELEVANT PERSONS. THIS APPENDIX DOES NOT ITSELF
CONSTITUTE AN OFFER FOR SALE OR SUBSCRIPTION OF ANY SECURITIES IN THE COMPANY.

THIS ANNOUNCEMENT IS NOT FOR PUBLICATION OR DISTRIBUTION, DIRECTLY OR
INDIRECTLY, IN OR INTO THE UNITED STATES OF AMERICA. THE SECURITIES MENTIONED
HEREIN HAVE NOT BEEN AND WILL NOT BE REGISTERED UNDER THE US SECURITIES ACT OF
1933, AS AMENDED (THE "SECURITIES ACT"), OR UNDER ANY SECURITIES LAWS OF ANY
STATE OR OTHER JURISDICTION OF THE UNITED STATES AND MAY NOT BE OFFERED, SOLD,
RESOLD, TRANSFERRED OR DELIVERED, DIRECTLY OR INDIRECTLY, IN OR INTO THE
UNITED STATES EXCEPT PURSUANT TO AN APPLICABLE EXEMPTION FROM, OR IN A
TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES
ACT AND IN COMPLIANCE WITH THE SECURITIES LAWS OF ANY STATE OR OTHER
JURISDICTION OF THE UNITED STATES. THERE WILL BE NO PUBLIC OFFER OF THE
SECURITIES MENTIONED HEREIN IN THE UNITED STATES.

THE SECURITIES MENTIONED HEREIN HAVE NOT BEEN AND WILL NOT BE APPROVED OR
DISAPPROVED BY THE US SECURITIES AND EXCHANGE COMMISSION (THE "SEC"), ANY
STATE SECURITIES COMMISSION OR ANY 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 CONTENT OF THIS ANNOUNCEMENT HAS NOT BEEN APPROVED BY AN AUTHORISED PERSON
WITHIN THE MEANING OF THE FINANCIAL SERVICES AND MARKETS ACT 2000 (AS AMENDED)
("FSMA"). RELIANCE ON THIS ANNOUNCEMENT FOR THE PURPOSE OF ENGAGING IN ANY
INVESTMENT ACTIVITY MAY EXPOSE AN INDIVIDUAL TO A SIGNIFICANT RISK OF LOSING
ALL OF THE PROPERTY OR OTHER ASSETS INVESTED.

EACH PLACEE SHOULD CONSULT WITH ITS OWN ADVISERS AS TO LEGAL, TAX, BUSINESS
AND RELATED ASPECTS OF AN ACQUISITION OF PLACING SHARES.

Unless otherwise defined in these Terms and Conditions, capitalised terms used
in these Terms and Conditions shall have the meaning given to them in the
Announcement to which these Terms and Conditions are appended.

Persons who are invited to and who choose to participate in the Placing by
making an oral or written offer to acquire Placing Shares, including any
individuals, funds or others on whose behalf a commitment to acquire Placing
Shares is given (the "Placees"), will be deemed: (i) to have read and
understood this Announcement, including this Appendix, in its entirety; (ii)
to be participating and making an offer for Placing Shares on the Terms and
Conditions; and (iii) to be providing the representations, warranties,
indemnities, agreements, acknowledgements and undertakings contained in this
Appendix.

In connection with Admission, the Company is preparing a prospectus (the
"Prospectus") and is seeking approval of the Prospectus by the Financial
Conduct Authority ("FCA"). The Prospectus will, subject to approval by the
FCA, be published on the Company's website. The Prospectus is not expected to
be approved and published prior to Placees entering into a legally binding
commitment in respect of the Placing. As such, any commitments made under the
Placing will be on the basis of this Announcement (including the Terms and
Conditions).

In particular, each such Placee represents, warrants and acknowledges that:

a)    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;

b)    it is and, at the time the Placing Shares are acquired, will be
outside the United States and acquiring the Placing Shares in an "offshore
transaction" in accordance with Rule 903 or Rule 904 of Regulation S under the
Securities Act ("Regulation S") and it is acquiring beneficial interests in
the Placing Shares for its own account; if acquiring the Placing Shares for
the account of one or more other persons, it has full power and authority to
make the representations, warranties, indemnities, agreements, undertakings
and acknowledgements herein on behalf of each such person;

c)    if it is a financial intermediary, as that term is used in Article
5(1) of the Prospectus Regulation or the UK Prospectus Regulation (as
applicable), (i) the Placing Shares subscribed for by it in the Placing will
not be subscribed for on a non-discretionary basis on behalf of, nor will they
be subscribed for with a view to their offer or resale, to persons in a member
state of the EEA other than EEA Qualified Investors, or persons in the United
Kingdom other than UK Qualified Investors; or (ii) where the Placing Shares
have been subscribed for by it on behalf of persons in any member state of the
EEA other than EEA Qualified Investors, or in the United Kingdom other than UK
Qualified Investors, the offer of those Placing Shares to it is not treated
under the Prospectus Regulation or the UK Prospectus Regulation (as
applicable) as having been made to such persons;

d)    it is acquiring the Placing Shares for its own account or is
acquiring the Placing Shares for an account with respect to which it exercises
sole investment discretion and has the authority to make and does make the
representations, warranties, indemnities, acknowledgements, undertakings and
agreements contained in this Appendix; and

e)    it understands (or if acting for the account of another person, such
person has confirmed that such person understands) and agreed to comply with
the resale and transfer restrictions set out in this Appendix.

This Announcement, including this Appendix, does not constitute an offer to
sell, or a solicitation of an offer to buy, securities in the United States.
Securities may not be offered or sold in the United States absent (i)
registration under the Securities Act or (ii) an available exemption from, or
in a transaction not subject to, registration under the Securities Act. The
securities mentioned herein have not been, and will not be, registered under
the Securities Act. The Placing Shares are being offered and sold outside the
United States in "offshore transactions" in accordance with Regulation S.
There will be no public offering of the Placing Shares in the United States.

 

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 Agreement, the Placing Shares and the Bookbuild

Zeus has entered into the Placing Agreement with the Company under which, on
the terms and subject to the conditions set out in the Placing Agreement,
Zeus, as agent for and on behalf of the Company, has agreed to procure Placees
for the Placing Shares at the Placing Price. The Placing is not being
underwritten by Zeus or any other person.

The exact number of Placing Shares to be allocated and issued to Placees shall
be determined by Zeus and the Company following completion of the Bookbuild
(as defined below).

The Placing Shares will, when issued, be subject to the memorandum and
articles of association of the Company and credited as fully paid and will
rank pari passu in all respects with the existing issued Ordinary Shares,
including the right to receive all dividends and other distributions declared,
made or paid in respect of such Ordinary Shares after the date of issue of the
Placing Shares.

Commencing today, Zeus will be conducting a bookbuilding process to determine
demand for participation in the Placing by Placees (the "Bookbuild"). This
Appendix gives details of the Terms and Conditions of, and the mechanics of
participation in, the Placing. No commissions will be paid by or to Placees in
respect of any participation in the Placing or subscription for Placing
Shares.

A bid in the Bookbuild will be made on the Terms and Conditions which are
attached to this Appendix and will be legally binding on the Placee on behalf
of which it is made and, except with Zeus's consent, will not be capable of
variation or revocation after the close of the Bookbuild.

The book will open with immediate effect. The final number of Placing Shares
to be issued pursuant to the Placing will be agreed by Zeus and the Company at
the close of the Bookbuild, and the result of the Placing will be announced as
soon as practicable thereafter.  The timing for the close of the Bookbuild
shall be at the discretion of Zeus. The allocation of the Placing Shares shall
be determined by agreement between the Company and Zeus.

To the fullest extent permissible by law, neither:

a)    Zeus;

b)    any of its affiliates, agents, advisers, directors, officers,
consultants or employees; nor

c)    to the extent not contained within (a) or (b), any person connected
with Zeus as defined in the FSMA ((b) and (c) being, together, "affiliates",
and individually, an "affiliate", of Zeus),

shall have any liability (including, to the extent permissible by law, any
fiduciary duties) to Placees or to any other person whether acting on behalf
of a Placee or otherwise. In particular, neither Zeus nor any of its
affiliates shall have any liability (including, to the extent legally
permissible, any fiduciary duties), in respect of their conduct of the
Bookbuild.

By participating in the Placing (such participation up to an agreed maximum
level to be confirmed in and evidenced by either (i) a recorded telephone call
or (ii) email correspondence, in either case between representatives of Zeus
to whom the Placee's commitment is given and the relevant Placee (a "Recorded
Commitment")), each Placee will be deemed to have read and understood the
Announcement and the Terms and Conditions in this Appendix in their entirety,
to be participating and acquiring Placing Shares on these Terms and Conditions
and to be providing the representations, warranties, indemnities, agreements,
acknowledgements and undertakings contained in these Terms and Conditions.

 

Application for listing and admission to trading

Subject inter alia to the Shareholders of the Company passing the Resolutions
and the approval and publication of the Prospectus, application will be made
for admission of the Placing Shares to the Official List (standard segment)
and to trading on the main market of the London Stock Exchange.

A further announcement will be made with details of the expected date for
Admission.

 

Principal terms of the Placing

Zeus is acting as agent for and on behalf of the Company.

Participation in the Placing is by invitation only and will only be available
to persons who may lawfully be, and are, invited by Zeus to participate.
Zeus and any of its affiliates are entitled to participate in the Placing as
principal.

Each Placee will confirm the maximum number of Placing Shares it is willing to
acquire in a Recorded Commitment.  Once they have made a Recorded Commitment,
each Placee will have an immediate, separate, irrevocable and binding
obligation, owed to Zeus (as agent for the Company), to subscribe and pay for,
at the Placing Price, the number of Placing Shares allocated to it, up to the
agreed maximum.

Each Placee's allocation (and whether such Placee participates in the Placing)
will be determined by agreement between the Company and Zeus and will be
confirmed by Zeus either orally or in writing via a contract note.

Each Placee's commitment will be confirmed in and evidenced by a Recorded
Commitment.  These Terms and Conditions will be deemed incorporated into each
contract which is entered into by way of a Recorded Commitment and will be
legally binding on the relevant Placee(s) on behalf of whom the commitment is
made with effect from the end of the Recorded Commitment and, except with
Zeus's prior written consent, will not be capable of variation or revocation
after the close of the Bookbuild.  A contract note confirming each Placee's
allocation of Placing Shares will be sent to them following the Recorded
Commitment and the allocation process.  These Terms and Conditions shall be
deemed incorporated into any such contract note.

Each Placee will have an immediate, separate, irrevocable and binding
obligation, owed to Zeus (as agent for the Company), to pay to it (or as it
may direct) in cleared funds an amount equal to the product of the Placing
Price and the number of Placing Shares allocated to such Placee.

Zeus and the Company reserve the right to scale back the number of Placing
Shares to be subscribed by any Placee in the event that the Placing is
oversubscribed. Zeus and the Company also reserve the right not to accept
offers to subscribe for Placing Shares or to accept such offers in part rather
than in whole. The acceptance and, if applicable, scaling back of offers shall
be at the absolute discretion of Zeus and the Company.

Except as required by law or regulation, no press release or other
announcement will be made by Zeus 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(s) pursuant to the
Placing is/are confirmed, settlement for all Placing Shares to be acquired
pursuant to the Placing will be required to be made at the same time on the
basis explained below under "Registration and Settlement".

All obligations under the Placing will be subject to fulfilment of the
conditions referred to below under "Conditions of the Placing" and to the
Placing not being terminated on the basis referred to below under "Termination
of the Placing".

By participating in the Placing, each Placee agrees 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.

 

Conditions of the Placing

The Placing is conditional upon the Placing Agreement becoming unconditional
and not having been terminated in accordance with its terms. Zeus's
obligations under the Placing Agreement are conditional on certain conditions,
including:

a)    Admission occurring at or before 8:00 a.m. (London time) by such time
as the Company and Zeus agree;

b)    the Prospectus having been approved as a prospectus for the purposes
of the Prospectus Regulation Rules of the FCA under section 73A of the FSMA
("Prospectus Regulation Rules");

c)    the Resolutions being passed at the General Meeting;

d)    the warranties of the Company being and remaining true and accurate
and not misleading as at the date of the Placing Agreement and immediately
prior to Admission;

e)    the publication by the Company of, among other announcements, the
announcement of the results of the Placing on a Regulatory Information
Service;

f)     the Company allotting, subject only to Admission, the relevant
Placing Shares in accordance with the Placing Agreement; and

g)    the delivery to Zeus of certain documentary conditions precedent.

If: (i) any of the conditions contained in the Placing Agreement, including
those described above, are not fulfilled or (where applicable) waived or
extended in writing by Zeus by the relevant time or date specified (or such
later time or date as the Company and Zeus may agree); or (ii) the Placing
Agreement is terminated in the circumstances specified below, the Placing will
lapse and the Placees' rights and obligations hereunder in relation to the
Placing Shares shall cease and terminate at such time and each Placee agrees
that no claim can be made by it in respect thereof.

Zeus may, at its discretion, extend the time for satisfaction of, or waive
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 Zeus nor any of its affiliates, agents, advisers, directors, officers
or employees nor the Company nor any of its affiliates, agents, advisers,
directors, officers or employees shall have any liability to any Placee (or to
any other person whether acting on behalf of a Placee or otherwise) in respect
of any decision it may make as to whether or not to waive or to extend the
time and/or date for the satisfaction of any condition to the Placing nor for
any decision any of them 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 Zeus
and/or the Company (as applicable).

 

Termination of the Placing

Zeus is entitled, in its discretion acting reasonably, by notice to the
Company at any time before Admission, to terminate the Placing Agreement in
accordance with its terms in the following (non-exhaustive) circumstances:

a)    any statement contained in the Placing Agreement or any other
document or announcement issued or published by or on behalf of the Company in
connection with the Placing ("Placing Documents") has become untrue,
inaccurate or misleading in any material respect or any matter has arisen
which would, if the Placing Documents were issued at that time, constitute a
material omission from the Placing Documents or any of them;

b)    any of the warranties was materially untrue, inaccurate or misleading
when made and/or that any of the warranties has ceased to be materially true
or accurate or has become materially misleading at any time prior to
Admission, in each case by reference to the facts and circumstances subsisting
at that time;

c)    the Company has not materially complied or cannot materially comply
with any of its obligations under the Placing Agreement or otherwise relating
to the Placing (to the extent that such obligations fall to be complied with
prior to Admission);

d)    trading in securities generally on the LSE has been suspended or
limited or minimum or maximum prices for trading have been fixed or maximum
ranges for prices have been required by any such exchanges or by such system
or by order of any governmental authority, or a material disruption has
occurred in commercial banking or securities settlement or clearance services
in the United Kingdom;

e)    a banking moratorium has been declared by the United Kingdom or in
London;

f)     there has occurred a material adverse change since the date of the
Placing Agreement in United Kingdom to Tax affecting the Ordinary Shares or
the transfer thereof or exchange controls have been imposed by the United
Kingdom; or

g)    a force majeure event occurs which in the reasonable opinion of Zeus
would be likely to be materially prejudicial to the Placing or Admission or
the financial or trading position or prospects of the Company or the Group,
taken as whole, or make it impracticable or inadvisable to proceed with the
Placing in the manner contemplated by the Placing Documents.

By participating in the Placing, each Placee agrees with the Company and Zeus
that the exercise by the Company or Zeus of any right of termination or any
other right or other discretion under the Placing Agreement shall be within
the absolute discretion of the Company or Zeus or for agreement between the
Company and Zeus and that neither the Company nor Zeus need make any reference
to such Placee and that none of the Company, Zeus nor any of their respective
affiliates, agents, advisers, directors, officers or employees shall have any
liability to such Placee (or to any other person whether acting on behalf of a
Placee or otherwise) whatsoever in connection with any such exercise.

By agreeing with Zeus (as agent of the Company) to subscribe for Placing
Shares under the Placing, a Placee (and any person acting on a Placee's
behalf) will irrevocably acknowledge, confirm, warrant, undertake to and agree
with, each of the Company and Zeus, in each case as a fundamental term of such
Placee's application for Placing Shares and of the Company's obligation to
allot and/or issue any Placing Shares to it or at its direction, that its
rights and obligations in respect of the Placing (or any part of it) will
terminate only in the circumstances described above and under the "Conditions
of the Placing" section above and will not be capable of rescission or
termination by it in any other circumstances.

 

Registration and Settlement

Settlement of transactions in the Placing Shares following Admission will take
place within the system administered by Euroclear UK & International
Limited ("CREST"). Subject to certain exceptions, Zeus and the Company reserve
the right to require settlement for, and delivery of, the Placing Shares (or
any part thereof) to Placees by such other means that they deem necessary if
delivery or settlement is not possible or practicable within the CREST system
within the timetable set out in this Announcement or would not be consistent
with the regulatory requirements in the Placee's jurisdiction.

Each Placee allocated Placing Shares in the Placing will be sent a trade
confirmation in accordance with the standing arrangements in place with Zeus
stating the number of Placing Shares allocated to it at the Placing Price, the
aggregate amount owed by such Placee to Zeus and settlement instructions. Each
Placee agrees that it will do all things necessary to ensure that delivery and
payment is completed in accordance with the standing CREST or certificated
settlement instructions in respect of the Placing Shares, or depositary
interests representing such Placing Shares, that it has in place with Zeus.

Settlement will take place in accordance with the instructions set out in the
trade confirmation.

Each Placee is deemed to agree that, if it does not comply with these
obligations, Zeus may sell any or all of the Placing Shares allocated to that
Placee on such Placee's behalf and retain from the proceeds, for Zeus's
account and benefit, an amount equal to the aggregate amount owed by the
Placee. The relevant Placee will, however, remain liable for any shortfall
below the aggregate amount owed by it and may be required to bear any stamp
duty or stamp duty reserve tax (together with any interest or penalties due
pursuant to the terms set out or referred to in these Terms and Conditions) or
other similar taxes imposed in any jurisdiction which may arise upon the sale
of such Placing Shares on such Placee's behalf.

If Placing Shares are to be delivered to a custodian or settlement agent,
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.

 

Representations, Warranties and Further Terms

By participating in the Placing, each Placee (and any person acting on such
Placee's behalf) irrevocably represents, warrants, acknowledges, undertakes,
confirms and agrees (for itself and for any such prospective Placee) that
(save where Zeus expressly agrees in writing to the contrary):

1.    it has read and understood the Announcement and these Terms and
Conditions in their entirety and its acquisition of Placing Shares is subject
to and based upon all the terms, conditions, representations, warranties,
indemnities, acknowledgements, agreements and undertakings and other
information contained herein and it has not relied on, and will not rely on,
any information given or any representations, warranties or statements made at
any time by any person in connection with Admission, the Placing, the Company,
the Placing Shares or otherwise, other than the information contained in the
Announcement and any information publicly announced through a Regulatory
Information Service by or on behalf of the Company on or prior to the date of
these Terms and Conditions ("Publicly Available Information");

2.    save for the Prospectus, it has not received a prospectus or other
offering document in connection with the Placing and acknowledges that no
prospectus or other offering document is required under any applicable law or
has been or will be prepared in connection with the Placing or the Placing
Shares.

3.    it has made its own assessment of the Placing Shares and has relied
on its own investigation of the business, financial position and other aspects
of the Company in accepting a participation in the Placing and neither Zeus
nor the Company nor any of their respective affiliates, agents, advisers,
directors, officers or employees nor any person acting on behalf of any of
them has provided, and will not provide, it with any material regarding the
Placing Shares or the Company or any other person other than the information
in the Announcement, the Prospectus and these Terms and Conditions or the
Publicly Available Information (as defined in the Terms and Conditions); nor
has it requested Zeus, the Company or any of their respective affiliates,
agents, advisers, directors, employees or officers or any person acting on
behalf of any of them to provide it with any such information;

4.    neither Zeus nor any person acting on its behalf, nor any of its
respective affiliates, agents, directors, officers or employees, has or shall
have any liability for any Publicly Available Information or any
representation relating to the Company, provided that nothing in these Terms
and Conditions excludes the liability of any person for any fraudulent
misrepresentation made by that person;

5.    the only information on which it is entitled to rely and on which it
has relied in committing to acquire the Placing Shares is contained in the
Announcement and the Publicly Available Information, such information being
all that it deems necessary to make an investment decision in respect of the
Placing Shares and it has made its own assessment of the Company, the Placing
Shares and the terms of the Placing based on the Announcement and the Publicly
Available Information;

6.    neither Zeus nor any of its affiliates, agents, directors, officers
or employees have made any representation or warranty to it, express or
implied, with respect to the Company, the Placing or the Placing Shares or the
accuracy, completeness or adequacy of the Announcement or Publicly Available
Information;

7.    it may not rely, and has not relied, on any investigation that either
Zeus, any of its affiliates or any person acting on their behalf, may have
conducted with respect to the Placing Shares or the Company, and none of such
persons has made any representation, express or implied, with respect to the
Company, the Placing Shares or the accuracy, completeness or adequacy of the
information from the LSE or any other information; each Placee further
acknowledges that it has conducted its own investigation of the Company and
the Placing Shares and has received all information it believes necessary or
appropriate in connection with its investment in the Placing Shares;

8.    the content of this Announcement and the Prospectus are exclusively
the responsibility of the Company and that neither Zeus nor its affiliates or
any person acting on behalf of any of them has or shall have any liability for
any information, representation or statement contained in, or omission from,
this Announcement, the Prospectus or any information previously published by
or on behalf of the Company, pursuant to applicable laws, 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, the
Prospectus 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 Placing Shares is contained
in this Announcement, the Prospectus and any information previously published
by the Company by notification to a Regulatory Information Service, such
information being all that such Placee deems necessary or appropriate and
sufficient 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 Zeus or the Company or any
of their respective affiliates, agents, directors, partners, officers or
employees and none of Zeus or the Company or any such affiliate, agent,
director, partner, officer or employee 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, provided that
nothing in this paragraph excludes the liability of any person for fraud or
fraudulent misrepresentation made by that person;

9.    it has the funds available to pay for the Placing Shares which it has
agreed to acquire and acknowledges and agrees that it will pay the total
subscription amount in accordance with the Announcement and these Terms and
Conditions by the due time and date set out herein, failing which the relevant
Placing Shares may be placed with other Placees or sold at such price as Zeus
determines;

10.  it and each person on whose behalf it is participating:

a)    is entitled to acquire Placing Shares pursuant to the Placing under
the laws and regulations of all relevant jurisdictions;

b)    has fully observed such laws and regulations;

c)    has capacity and authority and is entitled to enter into and perform
its obligations as an acquirer of Placing Shares and will honour such
obligations; and

d)    has obtained all necessary consents and authorities (including,
without limitation, in the case of a person acting on behalf of a Placee, all
necessary consents and authorities to agree to the terms set out or referred
to in these Terms and Conditions) under those laws or otherwise and complied
with all necessary formalities to enable it to enter into the transactions
contemplated hereby and to perform its obligations in relation thereto and, in
particular, if it is a pension fund or investment company, it is aware and
acknowledges that it is required to comply with all applicable laws and
regulations with respect to its acquisition of Placing Shares;

11.  it and the beneficial owner of the Placing Shares is, and at the time
the Placing Shares are acquired will be, outside the United States and
acquiring the Placing Shares in an "offshore transaction" as defined in, and
in accordance with, Regulation S under the Securities Act;

12.  it understands that the Placing Shares have not been, and will not be,
registered under the Securities Act and may not be offered, sold or resold in
or into or from the United States except pursuant to an effective
registration under the Securities Act, or pursuant to an exemption from, or in
a transaction not subject to, the registration requirements of the Securities
Act and in accordance with applicable state securities laws; and no
representation is being made as to the availability of any exemption under the
Securities Act for the reoffer, resale, pledge or transfer of the Placing
Shares;

13.  it (and any account for which it is purchasing) is not acquiring the
Placing Shares with a view to any offer, sale or distribution thereof within
the meaning of the Securities Act;

14.  it will not distribute, forward, transfer or otherwise transmit the
Announcement or these Terms and Conditions or any part of them or any other
presentational or other materials concerning the Placing (including, but not
limited to, the Prospectus) in or into or from the United States (including
electronic copies thereof) to any person, and it has not distributed,
forwarded, transferred or otherwise transmitted any such materials to any
person;

15.  none of Zeus, its affiliates and/or any person acting on behalf of any
of them is making any recommendations to it or advising it regarding the
suitability of any transactions it may enter into in connection with the
Placing and that participation in the Placing is on the basis that it is not
and will not be a client of Zeus and that Zeus has no duties or
responsibilities to it for providing the protections afforded to its clients
or for providing advice in relation to the Placing or in respect of any
representations, warranties, undertakings or indemnities contained in the
Placing Agreement or for the exercise or performance of any of its rights and
obligations thereunder including any rights to waive or vary any conditions or
exercise any termination right;

16.  it will make payment to Zeus for the Placing Shares allocated to it in
accordance with these Terms and Conditions on or by such date as notified by
Zeus or the Company, failing which the relevant Placing Shares may be placed
with others on such terms as Zeus determines in its absolute discretion
without liability to the Placee and the Placee will remain liable for any
shortfall below the aggregate amount owed by it and may be required to bear
any stamp duty or stamp duty reserve tax (together with any interest or
penalties due pursuant to the terms set out or referred to in these Terms and
Conditions) or other similar taxes imposed in any jurisdiction which may arise
upon the sale of such Placing Shares on such Placee's behalf;

17.  its Recorded Commitment to acquire Placing Shares will represent a
maximum number of Placing Shares which it may be required to subscribe for,
and that following the allocation process Zeus may call upon it to subscribe
for a lower number of Placing Shares (if any), but in no event in aggregate
more than the aforementioned maximum;

18.  no action has been or will be taken by any of the Company, Zeus or any
person acting on behalf of the Company or Zeus that would, or is intended to,
permit a public offer of the Placing Shares in the United States or in any
country or jurisdiction where any such action for that purpose is required;

19.  the person who it specifies for registration as holder of the Placing
Shares will be the Placee or a nominee of the Placee, as the case may be;

20.  neither Zeus nor the Company will be responsible for any liability to
stamp duty or stamp duty reserve tax resulting from a failure to observe the
above requirement.  Each Placee and any person acting on behalf of such
Placee agrees to acquire Placing Shares pursuant to the Placing and agrees to
indemnify the Company and Zeus in respect of the same on the basis that the
Placing Shares will be allotted to a CREST stock account of Zeus or
transferred to a CREST stock account of Zeus who will hold them as nominee on
behalf of the Placee until settlement in accordance with such Placee's
standing settlement instructions with Zeus;

21.  the allocation, allotment, issue and delivery to it, or the person
specified by it for registration as holder, of Placing Shares will not give
rise to a stamp duty or stamp duty reserve tax liability under (or at a rate
determined under) any of sections 67, 70, 93 or 96 of the Finance Act 1986
(depository receipts and clearance services) and it is not participating in
the Placing as nominee or agent for any person or persons to whom the
allocation, allotment, issue or delivery of Placing Shares would give rise to
such a liability;

22.  if it is within the United Kingdom, it and any person acting on its
behalf (if within the United Kingdom) falls within Article 19(5) and/or 49(2)
of the Order and undertakes that it will acquire, hold, manage and (if
applicable) dispose of any Placing Shares that are allocated to it for the
purposes of its business only;

23.  it has not offered or sold and will not offer or sell any Placing Shares
to persons in the United Kingdom 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 and which will not result in an offer to
the public in the United Kingdom within the meaning of section 85(1) of the
FSMA or an offer to the public in any member state of the EEA within the
meaning of Article 2(e) of the Prospectus Regulation as it forms part of the
UK domestic law by virtue of the European Union (Withdrawal) Act 2018, or an
offer to the public in any Relevant State within the meaning of the Prospectus
Regulation;

24.  it has only communicated or caused to be communicated and it 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 Placing Shares in circumstances in which section 21(1) of the FSMA does not
require approval of the communication by an authorised person and it
acknowledges and agrees that neither the Announcement nor these Terms and
Conditions has been or will be approved by Zeus in its capacity as an
authorised person under section 21 of the FSMA and it may not therefore be
subject to the controls which would apply if it was made or approved as a
financial promotion by an authorised person;

25.  it has complied and it will comply with all applicable laws in any
jurisdiction with respect to anything done by it or on its behalf in relation
to the Placing Shares (including all relevant provisions of the FSMA
and Market Abuse Regulation (EU Regulation No. 596/2014 which forms part of
domestic law pursuant to the European Union (Withdrawal) Act 2018) ("UK
MAR") in respect of anything done in, from or otherwise involving the United
Kingdom);

26.  if it has received any inside information (for the purposes of UK MAR
and/or section 56 of the Criminal Justice Act 1993 or other applicable law)
about the Company in advance of the Placing, it has not:

a)    dealt (or attempted to deal) in the securities of the Company;

b)    encouraged, recommended or induced another person to deal in the
securities of the Company; or

c)    unlawfully disclosed such information to any person, prior to the
information being made publicly available;

27.  neither Zeus, the Company nor any of their respective affiliates,
agents, advisers, directors, officers or employees nor any person acting on
behalf of Zeus, the Company or their respective affiliates, agents, advisers,
directors, officers or employees nor 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 nor providing advice in relation to the Placing nor in respect of any
representations, warranties, acknowledgements, agreements, undertakings, or
indemnities contained in the Placing Agreement nor the exercise or performance
of Zeus's rights and obligations thereunder including any rights to waive or
vary any conditions or exercise any termination right;

28.  either of Zeus and its affiliates, acting as an investor for its or
their own account(s), may bid or subscribe for and/or purchase Placing Shares
and, in that capacity, may retain, purchase, offer to sell or otherwise deal
for its or their own account(s) in the Placing Shares, any other securities of
the Company or other related investments in connection with the Placing or
otherwise.  Accordingly, references in these Terms and Conditions and/or the
Announcement to the Placing Shares being offered, subscribed, acquired or
otherwise dealt with should be read as including any offer to, or
subscription, acquisition or dealing by, Zeus and/or any of its affiliates
acting as an investor for its or their own account(s).  Neither Zeus nor the
Company intend to disclose the extent of any such investment or transaction
otherwise than in accordance with any legal or regulatory obligation to do so;

29.  it:

a)    has complied, and will comply, with its obligations in connection
with money laundering and terrorist financing under the Proceeds of Crime Act
2002, the Terrorism Act 2000, the Terrorism Act 2006 and the Money Laundering,
Terrorist Financing and Transfer of Funds (Information on the Payer)
Regulations 2017 (in each case as amended);

b)    is not a person: (i) with whom transactions are prohibited under the
US 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; (ii) named on the
Consolidated List of Financial Sanctions Targets maintained by HM
Treasury of the United Kingdom; or subject to financial sanctions imposed
pursuant to a regulation of the European Union or a regulation adopted by
the United Nations or other applicable law,

all such statutes, rules and regulations referred to in this paragraph 29
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 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 Zeus such evidence, if any, as to the identity or location or
legal status of any person which Zeus may request from it in connection with
the Placing (for the purpose of complying with the Regulations or ascertaining
the nationality of any person or the jurisdiction(s) to which any person is
subject or otherwise) in the form and manner requested by Zeus on the basis
that any failure by it to do so may result in the number of Placing Shares
that are to be acquired by it or at its direction pursuant to the Placing
being reduced to such number, or to nil, as Zeus may decide at its sole
discretion;

30.  in order to ensure compliance with the Regulations, Zeus (for itself and
as agent on behalf of the Company) or the Company's registrar may, in their
absolute discretion, require verification of its identity.  Pending the
provision to Zeus or the Company's registrar, as applicable, of evidence of
identity, definitive certificates in respect of the Placing Shares may be
retained at Zeus's absolute discretion or, where appropriate, delivery of the
Placing Shares to it in uncertificated form may be delayed at Zeus's or the
Company's registrar's, as the case may be, absolute discretion. If, within a
reasonable time after a request for verification of identity, Zeus (for itself
and as agent on behalf of the Company) or the Company's registrar have not
received evidence satisfactory to them, either Zeus and/or the Company may, at
its absolute discretion, terminate its commitment in respect of the Placing,
in which event the monies payable on acceptance of allotment will, if already
paid, be returned without interest to the account of the drawee's bank from
which they were originally debited;

31.  its commitment to acquire Placing Shares on the Terms and Conditions
will continue notwithstanding any amendment that may in future be made to the
terms and conditions 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 or Zeus's conduct of the Placing;

32.  neither Zeus nor any of its affiliates, agents, advisers, directors,
officers or employees makes any representation in respect of or shall have any
responsibility for the tax treatment that any Placee may receive or expect in
relation to their investment in Placing Shares;

33.  it has knowledge and experience in financial, business and international
investment matters as is required to evaluate the merits and risks of
acquiring the Placing Shares.  It further acknowledges that it is experienced
in investing in securities of this nature and is aware that it may be required
to bear, and is able to bear, the economic risk of, and is able to sustain, a
complete loss in connection with the Placing.  It has relied upon its own
examination and due diligence of the Company and its affiliates taken as a
whole, and the terms of the Placing, including the merits and risks involved;

34.  it irrevocably appoints any duly authorised officer of Zeus as its agent
for the purpose of executing and delivering to the Company and/or its
registrar any documents on its behalf necessary to enable it to be registered
as the holder of any of the Placing Shares which it agrees to acquire upon
these Terms and Conditions;

35.  the Company, Zeus and others (including each of their respective
affiliates, agents, advisers, directors, officers and employees) will rely
upon the truth and accuracy of the foregoing representations, warranties,
undertakings, acknowledgements and agreements, which are given to Zeus on
their own behalf and on behalf of the Company and are irrevocable;

36.  it is acting as principal only in respect of the Placing or, if it is
acquiring the Placing Shares as a fiduciary or agent for one or more investor
accounts, it is duly authorised to do so and it has full power and authority
to make, and does make, the foregoing representations, warranties,
acknowledgements, agreements and undertakings on behalf of each such accounts;

37.  time is of the essence as regards its obligations under these Terms and
Conditions;

38.  any document that is to be sent to it in connection with the Placing
will be sent at its risk and may be sent to it at any address provided by it
to Zeus;

39.  the Placing Shares will be issued subject to these Terms and Conditions;
and

40.  these Terms and Conditions and all documents into which these Terms and
Conditions are incorporated by reference or otherwise validly forms a part
and/or any agreements entered into pursuant to these Terms and Conditions and
all agreements to acquire Placing Shares pursuant to the Placing will be
governed by and construed in accordance with English law and it submits to the
exclusive jurisdiction of the English courts in relation to any claim, dispute
(contractual or otherwise) or matter arising out of or in connection with such
contract except that enforcement proceedings in respect of the obligation to
make payment for the Placing Shares (together with interest chargeable
thereon) may be taken by the Company or Zeus 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.

By participating in the Placing, each Placee (and any person acting on such
Placee's behalf) agrees to indemnify and hold the Company, Zeus and each of
their respective affiliates, agents, directors, officers and employees
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
given by the Placee (and any person acting on such Placee's behalf) in these
Terms and Conditions or incurred by Zeus, the Company or any of their
respective affiliates, agents, directors, officers or employees arising from
the non-performance of the Placee's obligations as set out in these Terms and
Conditions, and further agrees that the provisions of these Terms and
Conditions shall survive after the completion of the Placing.

The agreement to allot and issue Placing Shares to Placees (or the persons for
whom Placees are contracting as agent) free of stamp duty and stamp duty
reserve tax in the United Kingdom relates only to their allotment and issue
to Placees, or such persons as they nominate as their agents, direct by the
Company.  Such agreement assumes that the Placing Shares are not being
acquired 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 related to any other dealings in the Placing
Shares, stamp duty or stamp duty reserve tax may be payable.  In that event,
the Placee agrees that it shall be responsible for such stamp duty or stamp
duty reserve tax and neither the Company nor Zeus shall be responsible for
such stamp duty or stamp duty reserve tax.  If this is the case, each Placee
should seek its own advice and they should notify Zeus accordingly.  In
addition, Placees should note that they will be liable for any capital duty,
stamp duty and all other stamp, issue, securities, transfer, registration,
documentary or other duties or taxes (including any interest, fines or
penalties relating thereto) payable outside the United Kingdom by them or
any other person on the acquisition by them of any Placing Shares or the
agreement by them to acquire any Placing Shares, and each Placee, or the
Placee's nominee, in respect of whom (or in respect of the person for whom it
is participating in the Placing as an agent or nominee) the allocation,
allotment, issue or delivery of Placing Shares has given rise to such
non-United Kingdom stamp, registration, documentary, transfer or similar
taxes or duties, undertakes to pay such taxes and duties, including any
interest and penalties (if applicable), forthwith and to indemnify on an
after-tax basis and to hold harmless the Company and Zeus in the event that
any of the Company and/or Zeus have incurred any such liability to such taxes
or duties.

The representations, warranties, acknowledgements, agreements, indemnities and
undertakings contained in these Terms and Conditions are given to Zeus for
itself and on behalf of the Company and are irrevocable.

Zeus is authorised and regulated by the FCA in the United Kingdom and is
acting exclusively for the Company and no one else in connection with the
Placing, and will not be responsible to anyone (including any Placees) other
than the Company for providing the protections afforded to their clients or
for providing advice in relation to the Placing or any other matters referred
to in these Terms and Conditions.

Each Placee and any person acting on behalf of the Placee acknowledges that
Zeus does not owe any fiduciary or other duties to any Placee in respect of
any representations, warranties, undertakings, acknowledgements, agreements or
indemnities in the Placing Agreement.

The provisions of these Terms and Conditions may be varied, waived or modified
as regards specific Placees or on a general basis by Zeus provided always that
such variation, waiver or modification is not materially prejudicial to the
interests of the Company or Zeus.

In the case of a joint agreement to acquire Placing Shares, references to a
"Placee" in these Terms and Conditions are to each of such Placees and such
joint Placees' liability is joint and several.

 

Information to Distributors

Solely for the purposes of the product governance requirements contained
within: (a) EU Directive 2014/65/EU on markets in financial instruments, as
amended ("MiFID II"); (b) Articles 9 and 10 of Commission Delegated Directive
(EU) 2017/593 supplementing MiFID II; and (c) local implementing measures
(together, the "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 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 "Target Market Assessment").

Notwithstanding the Target Market Assessment, distributors should note that:
the price of the Company's common shares may decline and investors could lose
all or part of their investment; the Company's common shares offer no
guaranteed income and no capital protection; and an investment in the
Company's common 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, Zeus will only procure investors who meet the criteria of
professional clients and eligible counterparties. For the avoidance of doubt,
the Target Market Assessment does not constitute: (a) an assessment of
suitability or appropriateness for the purposes of MiFID II; or (b) a
recommendation to any investor or group of investors to invest in, or
purchase, or take any other action whatsoever with respect to the Placing
Shares.

Each distributor is responsible for undertaking its own target market
assessment in respect of the Placing Shares and determining appropriate
distribution channels.

 

General

Each Placee and any person acting on behalf of the Placee acknowledges and
agrees that Zeus may (at its absolute discretion) satisfy its obligations to
procure Placees by itself agreeing to become a Placee in respect of some or
all of the Placing Shares or by nominating any connected or associated person
to do so.

When a Placee or any person acting on behalf of the Placee is dealing with
Zeus, any money held in an account with Zeus on behalf of the Placee and/or
any person acting on behalf of the Placee will not be treated as client money
within the meaning of the relevant rules and regulations of the FCA 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 Zeus's money in accordance with the client
money rules and will be held by it under a banking relationship and not as
trustee.

In these Terms and Conditions, any words following the
terms "including", "include", "in particular", "for example" or any
similar expression shall be construed as illustrative and shall not limit the
sense of the words, description, definition, phrase or term preceding those
terms.

References to time in the Terms and Conditions are to London time, unless
otherwise stated.

All times and dates in these Terms and Conditions may be subject to
amendment.  Placees will be notified of any changes.

No statement in the Announcement or these Terms and Conditions is intended to
be a profit forecast or estimate, and no statement in the Announcement or
these Terms and Conditions should be interpreted to mean that earnings per
share of the Company for the current or future financial years would
necessarily match or exceed the historical published earnings per share of the
Company.

The price of Placing Shares and any income expected from them may go down as
well as up and investors may not get back the full amount invested upon
disposal of the Placing Shares.  Past performance is no guide to future
performance, and persons needing advice should consult an independent
financial adviser.

The Placing Shares to be issued pursuant to the Placing will not be admitted
to trading on any stock exchange other than the main market of the London
Stock Exchange.

Neither the content of the Company's website nor any website accessible by
hyperlinks on the Company's website is incorporated in, or forms part of,
these Terms and Conditions and/or the Announcement.

 

Definitions and interpretation

In this Appendix, unless the context otherwise requires:

 "Admission"                                 admission of the Placing Shares to the standard listing segment of the
                                             Official List and to trading on the London Stock Exchange's main market for
                                             listed securities becoming effective in accordance with, respectively, the
                                             Listing Rules and the Admission and Disclosure Standards;
 "Admission and Disclosure Standards"        the rules published by the London Stock Exchange containing, amongst other
                                             things, the admission requirements to be observed by companies seeking
                                             admission to trading on the London Stock Exchange's main market for listed
                                             securities;
 "General Meeting"                           the general meeting of the Company to be convened for the purpose of
                                             considering the Resolutions, notice of which will be set out in a Notice of
                                             General Meeting, or any adjournment of such meeting;
 "Listing Rules"                             the Listing Rules of the FCA under the FSMA;
 "LSE"                                       London Stock Exchange plc;
 "Ordinary Shares"                           means the ordinary shares of £0.01 each in the capital of the Company;
 "Placees"                                   means persons who agree conditionally to subscribe for the Placing Shares
                                             pursuant to the Placing in accordance with the Terms and Conditions;
 "Placing"                                   the proposed conditional placing of the Placing Shares at the Placing Price
                                             pursuant to the terms of the Placing Agreement, to be conducted by a bookbuild
                                             process on the Terms and Conditions annexed to this Announcement;
 "Placing Agreement"                         the placing agreement between the Company and Zeus entered into on the date of
                                             this Announcement in connection with the Placing and Admission;
 "Placing Price"                             £0.025 per Placing Share;
 "Placing Share"                             new Ordinary Shares to be conditionally placed by Zeus pursuant to the
                                             Placing;
 "Regulatory Information Services" or "RIS"  any of the services set out in the list of primary information providers
                                             maintained by the FCA; and
 "Resolutions"                               the resolutions to be proposed at the General Meeting.

 

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