REG - Oxford Cannabinoid - Posting of Circular & Notice of GM

Oxford Cannabinoid Technologies HoldingsAnnouncement

11/03/2022 10:00

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RNS Number : 5026E  Oxford Cannabinoid Tech.Holdings  11 March 2022

Oxford Cannabinoid Technologies Holdings plc

("OCTP", or the "Company")

Posting of Circular

&

Notice of Requisitioned General Meeting

 

Further to the announcement of 4 March 2022, Oxford Cannabinoid Technologies
Holdings plc (LSE: OCTP, OTCQB: OCTHF), the pharmaceutical company developing
prescription cannabinoid medicines for approval by global regulatory agencies
and targeting the US$ multi-billion pain market, announces that it will today
be posting a circular (the "Circular") to Shareholders convening a
requisitioned general meeting (the "Requisitioned General Meeting").

This follows the receipt of a letter from GHS Capital Limited ("GHS Capital"),
the holder of 78,146,151 ordinary shares of £0.01 each in the issued share
capital of the Company ("Ordinary Shares"), representing approximately 8.14
per cent. of the Company's issued share capital, requisitioning a general
meeting of the Company, as announced on 18 February 2022.

The Requisitioned General Meeting will be held at the offices of Penningtons
Manches Cooper LLP, 125 Wood Street, London EC2V 7AW at 10.30 a.m. on 6 April
2022.

At the Requisitioned General Meeting Shareholders will be asked to consider
the following ordinary resolutions:

1.     THAT James Brodie be and is hereby appointed as a director of the
Company (with such appointment taking immediate and simultaneous effect).

2.     THAT Richard Bedford be and is hereby appointed as a director of
the Company (with such appointment taking immediate and simultaneous effect).

3.     THAT Richard Grethe be and is hereby appointed as a director of the
Company (with such appointment taking immediate and simultaneous effect).

4.     THAT Julie Pomeroy be and is hereby removed as a director of the
Company.

5.     THAT Cheryl Dhillon be and is hereby removed as a director of the
Company.

6.     THAT John Lucas be and is hereby removed as a director of the
Company.

7.     THAT Neil Mahapatra be and is hereby removed as a director of the
Company.

8.     THAT Bishrut Mukherjee be and is hereby removed as a director of
the Company.

9.     THAT Richard Hathaway be and is hereby removed as a director of the
Company.

10.  THAT any person appointed as a director of the Company since the date of
the requisition of the Requisitioned General Meeting at which this resolution
is proposed, and who is not one of the persons referred to in the resolutions
numbered 1 through 10 (inclusive) above, be and is hereby removed as a
director of the Company.

 

The Board's unanimous recommendation is for shareholders to vote AGAINST all
of the resolutions being proposed by GHS Capital.

As announced on 4 March 2022, the Company is in receipt of irrevocable
undertakings to vote AGAINST the proposed resolutions from Shareholders
(including those of the Board) of 446,632,048 Ordinary Shares, representing
approximately 46.5 per cent. of the issued share capital of the Company.

Extracts from the Circular are set out below and should be read in conjunction
with the Circular. A copy of the Circular will shortly be available from the
Company's website: www.oxcantech.com/investor-financial-results-centre
(http://www.oxcantech.com/investor-financial-results-centre)   and in hard
copy form at the Company's registered office at Maddox House, 1 Maddox
Street, London W1S 2PZ. It is also available for inspection
at  www.fca.org.uk/markets/primary-markets/regulatory-disclosures/national-storage-mechanism
(https://urldefense.proofpoint.com/v2/url?u=http-3A__www.fca.org.uk_markets_primary-2Dmarkets_regulatory-2Ddisclosures_national-2Dstorage-2Dmechanism&d=DwMGaQ&c=euGZstcaTDllvimEN8b7jXrwqOf-v5A_CdpgnVfiiMM&r=7Um2a7LLyUH5SxHgl6zdagatUzGQxXwYgU_CeVAgL9Q&m=kR_Hjjn07Jsd47IiTGeyUKC3Q2HOmc2k-HnXXjfJDbg&s=z7lAUYO9aq6HBtuB_Hq8I10m4igZv3uixdkqQJaliao&e=)
.

This announcement contains inside information for the purposes of Article 7 of
EU Regulation 596/2014 (which forms part of domestic UK law pursuant to the
European Union (Withdrawal) Act 2018).

 

The Directors of the Company accept responsibility for the content of this
announcement.

 Enquiries:

 Oxford Cannabinoid Technologies Holdings plc  +44 (0)20 3034 2820

 Dr John Lucas (CEO)                           john@oxcantech.com

 Clarissa Sowemimo-Coker (COO)                 clarissa@oxcantech.com

 Cairn Financial Advisers LLP

 Emily Staples                                 +44 (0)20 7213 0897

 Jo Turner                                     +44 (0) 20 7213 0885

 Walbrook PR Limited                           +44 (0)20 7933 8780

 Paul Vann                                     +44 (0)7768 807631

 Nicholas Johnson                              oxcantech@walbrookpr.com

 Harbor Access LLC (US/OTCB enquiries)

 Jonathan Paterson                             +1 (203) 862 0492

 Richard Leighton                              Richard.Leighton@harboraccessllc.com

 

About Oxford Cannabinoid Technologies Holdings Plc:

Oxford Cannabinoid Technologies Holdings plc is the holding company of Oxford
Cannabinoid Technologies Ltd, a pharmaceutical company developing prescription
cannabinoid medicines for approval by key medicines regulatory agencies
worldwide and targeting the U$ multi-billion pain market (together the
"Group"). Cannabinoids are compounds found in the cannabis plant that have
been shown to have a range of therapeutic effects on the body, including pain
relief. The Group has a clearly defined path to commercialisation, revenues
and growth. The Group is developing drug candidates through clinical trials to
gain regulatory approval (FDA/MHRA/EMA) that will enable medical professionals
to prescribe them with confidence.

The Group's portfolio aims to balance risk, value and time to market, whilst
ensuring market exclusivity around all its key activities. The Group's lead
compound, OCT461201, is a highly potent and selective CB2 agonist and is being
developed by OCT in a solid oral dosage form. OCT is conducting pre-clinical
testing and development with clinical trials scheduled for Q1 2023. The
Group's product pipeline also uses a balanced drug product strategy that
employs both natural and synthetic compounds for the treatment of rare
diseases and includes chemically modified phytocannabinoids with improved
drug-like characteristics and a proprietary library of cannabinoids.

OCTP operates a partnership model with external academic and commercial
partners.

 

Caution regarding forward looking statements

Certain statements in this announcement, are, or may be deemed to be, forward
looking statements. Forward looking statements are identified by their use of
terms and phrases such as ''believe'', ''could'', "should" ''envisage'',
''estimate'', ''intend'', ''may'', ''plan'', ''potentially'', "expect",
''will'' or the negative of those, variations or comparable expressions,
including references to assumptions. These forward-looking statements are not
based on historical facts but rather on the Directors' current expectations
and assumptions regarding the Company's future growth, results of operations,
performance, future capital and other expenditures (including the amount,
nature and sources of funding thereof), competitive advantages, business
prospects and opportunities. Such forward looking statements reflect the
Directors' current beliefs and assumptions and are based on information
currently available to the Directors.

 

 

LETTER FROM THE BOARD

 

Notice of Requisitioned General Meeting and unanimous recommendation of your
Board to

VOTE AGAINST all Resolutions

 

1.       INTRODUCTION

 

On 18 February 2022, the Company received a notice ("Notice of Requisition")
from Gavin Sathianathan in his capacity as Chairman, CEO and Director of GHS
Capital Limited, which is the holder of 78,146,151 Ordinary Shares,
representing approximately 8.14 per cent. of the issued ordinary share capital
in the Company, requesting the Company to convene a general meeting of its
Shareholders pursuant to section 303 of the Act.

The Notice of Requisition requires the Directors to convene a general meeting
(the "Requisitioned General Meeting") for the purpose of proposing ordinary
resolutions to remove Julie Pomeroy, Cheryl Dhillon, John Lucas, Neil
Mahapatra, Bishrut Mukherjee and Richard Hathaway as Directors of the Company
and to appoint James Brodie, Richard Bedford and Richard Grethe, as directors
of the Company.

On 24 November 2021, following the Company's Annual General Meeting at which
the entire Board was re-elected (save for Richard Hathaway who has only
recently been appointed), Mr Sathianathan resigned from his role as a
Non-Executive Director of the Company stating that he remained "fully
supportive of the Company" and that he was looking forward "to playing an
active role as a key shareholder in the future".

Your Board is not aware of any change in circumstances over the past three
months since the Annual General Meeting that justify, in any sense, the Notice
of Requisition and we deal, in detail, with each of the purported issues
raised by Mr Sathianathan in paragraph 3 below. Since Admission, the Board has
not deviated from the strategy set out in the Company's Prospectus and
operationally, the Company has made good progress and is in strong financial
health. Cash resources remain within forecast at approximately £11m as at the
date of the Circular, with the Company on target to be in phase 1 clinical
trials with both OCT461201 and OCT130401 by Q1 2023 which is anticipated by
the Directors to drive value for the Company and its Shareholders.

Your Board believes that Mr Sathianathan's proposals should be firmly resisted
in the interests of Shareholders as a whole and that all Shareholders should
vote AGAINST the Requisitioned Resolutions. As announced on 4 March 2022, the
Company is already in receipt of irrevocable undertakings from holders
(including those of the Board) of 446,632,048 Ordinary Shares, representing
approximately 46.5 per cent. of the issued share capital of the Company, to
vote AGAINST the Requisitioned Resolutions.

A notice convening the Requisitioned General Meeting for 10.30 a.m. on 6 April
2022 is set out on page 14 of the Circular.

The purpose of this letter is to explain why your Board believes these
proposals are wholly unacceptable and strongly believes that the Requisitioned
Resolutions are not in the best interests of the Company and its Shareholders
as a whole and, given the irrevocable undertakings already secured from
Shareholders to vote against the Requisitioned Resolutions, regrets the
unnecessary expense, waste of management time and damage to your Company
caused by the actions of former Non-Executive Director Mr Sathianathan and GHS
Capital Limited.

Accordingly, your Board recommends unanimously that Shareholders VOTE AGAINST
THE REQUISITIONED RESOLUTIONS at the Requisitioned General Meeting.

 

2.       REASONS GIVEN FOR THE REQUISITIONED GENERAL MEETING

 

In accordance with the Act, the letter from Mr Sathianathan in his capacity as
Chairman, CEO and Director of GHS Capital Limited setting out his reasons for
requesting the Company to convene the Requisitioned General Meeting
accompanies the Circular.

 

3.       YOUR BOARD'S RESPONSE TO THE NOTICE OF REQUISITION

 

Your Board believes that the Requisitioned Resolutions proposed by GHS Capital
are completely without merit. They are also a distraction to the Board whose
focus should be on continuing to execute the strategy communicated in the
Prospectus it prepared in support of its admission to the standard segment of
the Official List and to trading on the Main Market on 21 May 2021. Since
Admission, the Board has not deviated from this stated strategy and the
Directors believe that to change it at this time would be to destroy the key
value in the Company when the building blocks have been put in place to create
a successful participant in the pharmaceutical cannabinoid market.

 

In the following paragraphs, the Board discusses the operational status of the
Company's wholly owned operating subsidiary Oxford Cannabinoid Technologies
Ltd ("OCT") and the Company's share price performance, and addresses each
point made in the statement by GHS Capital.

 

A.      Summary of the operational status of the Group communicated via
various announcements since Admission

 

The Company has made strong progress since Admission and is on track to
complete all workstreams outlined in the Prospectus. Specific detail is
provided on each drug development programme below:

 

•        Programme 1 (OCT461201): OCT461201 has progressed through
pre-clinical development, in-line with plans communicated at Admission. The
Group has entered into research contracts with Voisin Consulting SARL and a
subsidiary of Evotec SE for manufacturing, development and compound
crystallisation, as preparation for phase 1 clinical trials continues in
earnest. The Group expects to start phase 1 clinical trials in early Q1 2023
rather than late Q3 2022, a result of technical issues associated with scale
manufacturing that necessitated additional compound optimisation. However, at
this time the Board does not believe that this will impact either the
anticipated time to phase 2 clinical trials nor the ultimate time to market;

 

Most importantly, as outlined in the Company's announcement of 8 March 2022,
the results of a recent pre-clinical efficacy study before human trials show
OCT461201 successfully reduces pain in a pre-clinical animal model of
Chemotherapy Induced Peripheral Neuropathy ("CIPN") induced by paclitaxel, a
widely used chemotherapy agent. Two common symptoms of CIPN are pain caused by
innocuous stimuli, like light touch (mechanical allodynia) and heat or cold
(thermal hyperalgesia).  In the study, OCT461201 significantly reduced pain
from both mechanical allodynia and thermal hyperalgesia compared to untreated
animals. This is a positive result: whilst a compound's path through human
clinical trials always has uncertainty, the Directors believe the results will
translate to humans. It should also be noted that previous animal safety data
suggests that a three times more concentrated dose of OCT461201 could have
been administered. The Company's Chief Executive Officer, John Lucas, was
primarily responsible for the identification, negotiation, licensing and
development of OCT461201;

 

•        Programme 2 (OCT 130401): The Company's other lead programme
has also progressed in-line with the plans communicated at Admission. The
Group has entered into development agreements with Charles Rivers Laboratories
Edinburgh Ltd, Purisys LLC, and OZ UK Ltd, as OCT130401 and its inhaler
delivery device are prepared for phase 1 clinical trials, anticipated in Q4
2022. There has been a short delay in development time (from Q3 2022), driven
by partners' capacity challenges caused by Covid, but the Board does not
currently believe that this will affect the time to phase 2 clinical trials,
nor the ultimate time to market. The Group has also announced the orphan
indication Trigeminal Neuralgia as the initial target for OCT130401, an
indication in the growing neuralgia market, which overall is worth
approximately $1.8 billion. The Directors believe that this second primary
programme is as exciting as OCT461201, and being a phytocannabinoid
combination, adds balance to the Company's drug development strategy;

 

•        Programmes 3 & 4:  with regards to its earlier-stage
development programmes, the Company has surpassed the deliverables
communicated to investors at Admission. Cannabinoid derivatives are at the
core of both programmes and last September, the Company announced the Group's
exclusive agreement with Canopy Growth Corporation ("Canopy Growth" or
"Canopy") for its pharmaceutical cannabinoid derivative library, comprising
335 derivatives and 14 patent families. This has jump-started both development
programmes, with multiple screening initiatives already underway across an
expanded therapeutic area set (including pain, neurology, and oncology). The
Group is working with the organisation that previously synthesised the
compounds for Canopy Growth (leveraging existing knowledge) and the drug
development agreement signed with Oxford Stemtech Ltd ("Stemtech") is
significant, with Stemtech's cutting-edge in-vitro "pain-in-a-dish" model
(using human adult stem cells) allowing for high-throughput experiments to be
completed cost effectively.

 

Noting that there has been no deviation in strategy to that set out in the
Prospectus it is disappointing to receive the Notice of Requisition, requested
by a Shareholder who previously supported this same strategy from before
Admission up to as recently as four months ago. Operationally, the Company has
made good progress since Admission and is in strong financial health. Cash
resources remain within forecast at approximately £11m as at the date of the
Circular, with the Company on target to be in phase 1 clinical trials with
both OCT461201 and OCT130401 by Q1 2023 which is anticipated by the Directors
to drive value for the Company and its Shareholders.

 

B.      Share Price Performance

 

The share price performance of the Company since Admission is a huge
disappointment to the Board. However, we neither believe that this represents
the value of the Company nor is it a function of poor strategy or any issue
that is intrinsic to the Company. The Board believes that the share price has
largely decreased due to a poor market backdrop and selling from short-term
investors hoping to make a quick return in the cannabis market. We do not
believe that the price is indicative of the operational or financial health of
the business nor the outlook in the medium term and beyond. In particular:

 

•        Market backdrop: the market backdrop for all London-listed
cannabis companies has been extremely poor over the last nine months. On
average, between Admission and 18 February 2022 (the date of the Notice of
Requisition), the share prices of the Company's London-listed cannabis-related
peers have fallen by approximately 47 per cent. (see chart below). Shares in
biotechnology companies have also fallen (with the Nasdaq biotechnology index
having fallen by approximately 14% over the same period). As such, being both
a cannabinoid company and a biotechnology business, the Company has been
caught in a "perfect storm" of negative market performance. This goes some way
to explaining share price performance since Admission, but the Directors
believe that it is not representative of the long-term prospects for the
Company;

 

•        Cash to reach value inflection: when assessing the actual
prospects of the Company, your Board is of the view that the single most
important criteria is that the Company has the necessary capital required to
progress its drug development activities to reach key value inflection points.
These inflection points are the completion of phase 1 clinical trials for the
two primary drug programmes. We do not currently believe that there will be
any requirement for additional capital raises in order for these milestones to
be met;

 

•        Positioning: The Board believes that the Company's
positioning remains a point of difference amongst its London-listed cannabis
peers. In a cannabis market where unlicensed medicines are abundant and
unproven, the Company's underlying philosophy is unchanged and consistent:
that it is only by developing cannabinoid medicines through the existing
channels of drug development that the medical community can have the
confidence to prescribe in volume. The agreements that the Group has signed to
date reflect this core ethos: we have partnered with organisations that
represent the gold-standard in pharmaceutical development. The Board believes
that this positioning will be of increasing value as the Company's drug
programmes progress and drive share price appreciation in the medium and long
term;

 

•        Selling pressure: it is also worth noting that the selling
activity in the Company's shares since Admission has contributed to a constant
downwards pressure on the share price. We understand that this consistent
selling presence has been an impediment to any share buying momentum in the
Ordinary Shares.

 

As an early stage pharmaceutical business, the Company has always been
positioned as a long-term investment. This has not changed: the path of drug
development is necessarily long, and biotechnology companies typically face
challenges associated with a paucity of share price catalysts between
developmental milestones. However, the Board does not believe that this is
representative of the medium and long term prospects for the Company.

 

C.         Addressing the Notice of Requisition

 

As set out above, the Board believes that the Requisitioned Resolutions
proposed by GHS Capital are without merit, opportunistic, and poorly
considered. We address each of the points made in turn:

 

•        Strategic Review: it is disappointing to see a request for a
strategic review. The Company's strategy remains the same as that communicated
at Admission and is in line with the current trends in cannabinoid drug
development. Our strategy aims to employ a balanced approach that combines
previously successful strategies (e.g. targeting orphan indications) with new
strategies enabled by recent advances in cannabinoid research (e.g. more focus
on individual molecules, cannabinoid derivatives and novel receptors). This
has already started to generate success: as announced on 8 March 2022,
pre-clinical data for OCT461201 suggests a positive dose dependant effect in
CIPN, which affects, on average, an estimated 60 per cent. of people
undergoing chemotherapy at 3 months, our phytocannabinoid inhaler continues
development for Trigeminal Neuralgia, an orphan indication, and as previously
announced, Canopy Growth (one of the largest cannabis firms in the world) has
entrusted the Company with its library of cannabinoid derivative compounds,
providing strong validation of the Company's derivative strategy;

 

We strongly believe that there is no need for the Company to change direction
and we continue to execute on exactly the strategy that was outlined at
Admission (which Mr Sathianathan previously voted for whilst a Non-Executive
Director of the Company). Any deviation from this strategy would likely
immediately negate the financial investment that has been made into each
development programme and cause significant delays in taking any drugs to
market. As set out above, the Company has already received irrevocable
undertakings from Shareholders holding 46.5% of the Ordinary Shares to vote
against the Requisitioned Resolutions - these are Shareholders that are long
term investors in the Company and their support is key;

 

•        Reduction of Costs: this point is entirely without merit and
unjustified. Firstly, as shown in the  interim financial statements, the
administrative costs of the Company are under constant scrutiny and efforts to
generate cost savings are on-going. For example, as set out in the Interim
Results for the six months ended 30 November 2021, the Company has given
notice on its London office, expiring 31 March 2022, which is expected to
generate cost savings of circa £130k per year. The Company also terminated a
services agreement with Kingsley Capital Partners LLP in December 2021,
generating further cost savings. Secondly, the anticipated costs were drawn-up
in detail, in preparation for Admission, and were agreed to by the Company's
advisers and approved by the Board, (including Mr Sathianathan when he was a
Non-Executive Director). Finally, as announced on 4 March 2022, in light of
the number of irrevocable undertakings received, we gave Mr Sathianathan the
opportunity to withdraw the Notice of Requisition in an attempt to avoid
unnecessary expense but he declined to engage with us;

 

•        Replacement of Directors: it is disappointing to see Mr
Sathianathan actively championing a reduction of diversity with his proposed
replacement directors. We firmly believe that none of the Directors need to be
replaced and, indeed, all of them, save for Richard Hathaway who has only
recently been appointed, were re-elected at the Company's Annual General
Meeting on 24 November 2021, just over three months ago. The Board already
comprises the skillsets required to guide the business past the completion of
clinical trials and through to the marketing authorisation of its drugs.
Taking them in turn:

 

John Lucas - in John, we have a seasoned CEO who has identified and
in-licensed a compound with significant potential, driven the development of
all four drug programmes, is taking OCT's first two drug programmes
successfully through pre-clinical development, and who was also instrumental
in negotiating the agreement with Canopy Growth for its pharmaceutical
cannabinoid derivative library, comprising 335 derivatives and 14 patent
families, which has added significant momentum to the Company's third and
fourth programmes;

 

Cheryl Dhillon - in Cheryl the Company is fortunate to have an independent
Non-Executive Director who is an experienced pharmaceutical executive with
three decades of experience in companies including Ares Serono Group, Elan
Corporation Plc, Lorantis Ltd and a tenure of over 15 years with Otsuka
Pharmaceutical Europe Ltd; part of the Otsuka family of companies. Cheryl's
advice is already invaluable but will become even more so when the Company
starts clinical trials in a few months;

 

Richard Hathaway - Richard is currently Corporate Development Director at
FTSE-100 Imperial Brands plc where he is responsible for leading M&A
activity and other strategic initiatives and projects across the business. He
has extensive experience of auditing and advising public and private companies
across a wide range of sectors, including transactions such as financing and
restructuring, acquisitions and disposals;

 

Bishrut Mukherjee - Bishrut has played a valuable role to date in guiding the
Company, not only in terms of its operational drug development activities but
also in evaluating the strategic direction of the business. Following his
resignation from Imperial Brands Ventures Limited in September 2021, he also
provides valuable perspective as an independent Non-Executive Director and his
wide range of experience within operational delivery, M&A, corporate
strategy and investment analysis, principally across regulated industries
including those of manufacturing, energy, pharmaceuticals and FMCG is an asset
to the Board;

 

Neil Mahapatra - as the founder and previous Chairman, Neil retains a deep
knowledge of the business, its history and strategy. Neil was responsible for
approaching Oxford University and negotiating the Company's research agreement
with Oxford University, launching the cannabinoid derivative creation
programme as a result. He liaised with the UK Home Office to obtain OCT's
first licence for cannabis handling and research and was responsible for
securing all private funding for the Company aside from Imperial Brands and
nearly 25 per cent. of funds at Admission (the remainder secured by a capital
raising firm);

 

Julie Pomeroy - in Julie the Company has a skilled and balanced independent
Non-Executive Chair with around 20 years' experience on the boards of publicly
quoted companies.  She is a Non-Executive Director at Dillistone Group Plc,
an AIM quoted software business, where until September 2021 she was the group
finance director and company secretary having joined in 2010. She also spent
over 12 years as a non-executive director on two NHS Trust Boards.  Julie is
a Chartered Accountant and also a Chartered Director and brings governance
experience for publicly listed companies;

 

 

•        Improve corporate governance: we strongly reject this
criticism and believe it to be a generic request due to its absence of
foundation. The Board places great emphasis on good corporate governance and,
as set out in the Prospectus, has not only committed to comply with the
Premium Listing Principles set out in Chapter 7 of the Listing Rules
(notwithstanding that they only apply to companies with a Premium Listing) and
to adopt and comply with the QCA Code on a comply or explain basis but, as set
out in the 2021 Annual Report, the Company has complied with the QCA Code to
date and has no intention to deviate from this.  In addition, the Board is
surprised that Mr Sathianathan would raise an issue such as this in a
requisition notice rather than engage directly with the Board, either while he
held the position of Non-Executive Director or subsequently, through GHS
Capital, as a large Shareholder, where any concern he may have had could have
been discussed and implemented if deemed appropriate We note that at midnight
on the day before the Company was required to post the Circular, Mr
Sathianathan sent a letter to the Chair making various spurious allegations
concerning the Board and the Company's operations. We will consider these in
full and address them separately to the extent they merit a response.

 

 

4.       IRREVOCABLE UNDERTAKINGS

 

As announced on 4 March 2022, the Directors are pleased to report that they
have received irrevocable undertakings (including those of the Board) to vote
against the Requisitioned Resolutions from Shareholders representing
approximately 46.5 per cent. of the Company's issued share capital.

 

5.       NOTICE OF REQUISITIONED GENERAL MEETING

 

A notice convening the Requisitioned General Meeting at which the
Requisitioned Resolutions will be proposed is set out on page 14 of the
Circular.

 

Shareholders are asked to note that in line with the most recent Institutional
Shareholder Services' Proxy Voting Guidelines, effective for meetings on are
after 1 February 2022, the Requisitioned General Meeting is being called on 21
days' notice rather than 14 days to enable Shareholders to have as much notice
of the meeting with time for consideration as practicable.

 

6.       ACTION TO BE TAKEN BY SHAREHOLDERS

 

Shareholders who hold their Ordinary Shares in certificated form should check
that they have received the following with the Circular:

 

·      a Form of Proxy for use in relation to the Requisitioned General
Meeting; and

·      a reply-paid envelope for use in connection with the return of
the Form of Proxy (in the UK only).

 

You are strongly encouraged to complete, sign and return your Form of Proxy in
accordance with the instructions printed thereon so as to be received, by post
or, during normal business hours only, by hand to the Company's Registrar,
Computershare Investor Services PLC at The Pavilions, Bridgwater Road, Bristol
BS99 6ZY, as soon as possible but in any event so as to arrive by not later
than 10:30 a.m. on 4 April 2022 (or, in the case of an adjournment of the
Requisitioned General Meeting, not later than 48 hours before the time fixed
for the holding of the adjourned meeting (excluding any part of a day that is
not a Business Day)).

 

Alternatively, register your vote online by visiting
www.investorcentre.co.uk/eproxy (http://www.investorcentre.co.uk/eproxy) and
following the instructions provided.

 

 

7.       DIRECTORS' RECOMMENDATION

 

The Company's share price performance in the ten months since Admission is
hugely disappointing. However, we believe this relates to short term issues
which are not reflective of the fundamentals of the business: by continuing to
execute on the strategy outlined at Admission, the Board believes that the
Company's prospects remain positive, with enough capital raised at Admission
to ensure that important milestones of bringing OCT461201 and through to
completion of phase 1 clinical trials, as set out in the Prospectus, can be
reached. The Board is proud of the support shown by its Shareholders, as
evidenced by the irrevocable undertakings to vote against all the
Requisitioned Resolutions already received representing over 46.5% of the
issued share capital.

 

We believe that any Shareholders choosing to support the Requisitioned
Resolutions would be endorsing values that are not consistent with the Company
or its institutional investors: short-termism and a seemingly active desire to
reduce diversity, promoted by a Shareholder who seems content for the Company
to incur unnecessary and significant costs in the calling of the Requisitioned
Meeting. None of these are values that the Company or its Board stands for.

 

The Company has a clear strategy for drug development. The Directors are
committed to providing the management team with the time and resource
necessary to execute on the strategy outlined in the Prospectus, without
distractions such as these.

 

For all of the reasons given above, your Board believes that these proposals
should be firmly resisted in the interests of Shareholders as a whole and that
all Shareholders should vote AGAINST the Requisitioned Resolutions to be
proposed at the Requisitioned General Meeting. As announced on 4 March 2022,
the Company is already in receipt of irrevocable undertakings from holders
(including those of the Board) of 446,632,048 Ordinary Shares, representing
approximately 46.5 per cent. of the issued share capital of the Company, to
vote AGAINST the Requisitioned Resolutions.

 

Yours sincerely

 

 

 

Julie Pomeroy              Cheryl
Dhillon              Richard Hathaway        Bishrut
Mukherjee

Chair
NED
NED                             NED

 

 

 

Neil Mahapatra             John
Lucas                  Karen
Lowe                  Clarissa Sowemimo-Coker

NED
CEO
CFO                             COO

 

 

DEFINITIONS

 

The following definitions apply throughout the Circular unless the context
otherwise requires:

 

 "Act"                                        the Companies Act 2006 (as amended);

 "Admission"                                  the admission of the Ordinary Shares to the standard listing segment of the
                                              Official List and to trading on the Main Market that became effective on 21
                                              May 2021;

 "Board" or "Directors"                       the directors of the Company as at the date of the Circular, whose names are
                                              set out on page 4 of the Circular;

 "Business Day"                               any day (excluding Saturdays and Sundays) on which banks are open in London

                                            for normal banking business and the London Stock Exchange is open for trading;

 "Cellular Goods"                             Cellular Goods plc;

 "certificated" or "in certificated form"     where an Ordinary Share is not in uncertificated form (i.e. not held in
                                              CREST);

 "Chair"                                      the chair of the Board;

 "CIPN"                                       Chemotherapy Induced Peripheral Neuropathy;

 "Company"                                    Oxford Cannabinoid Technologies Holdings PLC, a company incorporated in
                                              England and Wales under company number 13179529;

 "CREST"                                      the relevant system for the paperless settlement of trades and the holding of
                                              uncertificated securities operated by Euroclear in accordance with the CREST
                                              Regulations;

 "CREST participant ID"                       shall have the meaning given in the CREST Manual;

 "CREST Regulations"                          the Uncertificated Securities Regulations 2001 (SI 2001/3755) including any
                                              enactment or subordinate legislation which amends or supersedes those
                                              regulations and any applicable rules made under those regulations or any such
                                              enactment or subordinate legislation for the time being in force;

 "Euroclear"                                  Euroclear UK & International Limited;

 "FCA"                                        the Financial Conduct Authority of the United Kingdom;

 "Form of Proxy"                              the form of proxy for use by Shareholders in relation to the Requisitioned
                                              General Meeting, enclosed with the Circular;

 "FSMA"                                       the Financial Services and Markets Act 2000 (as amended);

 "Group"                                      the Company and its subsidiaries (as defined in the Act);

 "Kanabo"                                     Kanabo Group plc;
 "Listing Rules"                              the listing rules of the FCA;

 "London Stock Exchange"                      London Stock Exchange Group plc;

 "Main Market"                                the London Stock exchange's main market for listed securities;
 "MGC Pharma"                                 MGC Pharmaceuticals Limited;

 "Notice of Requisition"                      the notice from Gavin Sathianathan in his capacity as Chairman, CEO and
                                              Director of GHS Capital Limited dated 18 February 2022;

 "Notice of Requisitioned General Meeting"    the notice convening the Requisitioned General Meeting as set out at the end
                                              of the Circular;

 "OCT"                                        Oxford Cannabinoid Technologies Ltd, the Company's wholly owned subsidiary;

 "Official List"                              the Official List maintained by the FCA;

 "Ordinary Shares"                            the ordinary shares of £0.01 each in the capital of the Company in issue from
                                              time to time;

 "Oxford University"                          The Chancellor Masters and Scholars of the University of Oxford;

 "Pharma C"                                   Pharma C Investments PLC;

 "Premium Listing"                            a premium listing on the Official List under Chapter 6 of the Listing Rules;

 "Premium Listing Principles"                 the listing principles, applicable to a company with a Premium Listing,
                                              contained in Chapter 7 of the Listing Rules;

 "Prospectus"                                 the prospectus dated published by the Company in connection with Admission
                                              dated 17 May 2021;

 "Prospectus Regulation Rules"                the prospectus regulation rules of the FCA made pursuant to

                                              section 73A of the FSMA, as amended;

 "QCA Code"                                   the QCA Corporate Governance Code 2018, published by the

                                              Quoted Companies Alliance;

 "Registrar"                                  Computershare Investor Services PLC of The Pavilions, Bridgwater, Road,

                                            Bristol BS13 8AE;

 "Regulatory Information Service"             one of the regulated information services authorised by the FCA to receive,
                                              process and disseminate regulatory information in respect of listed companies;

 "Requisitioned General Meeting"              the Requisitioned General Meeting of the Company convened for 10:30 a.m. on 6
                                              April 2022 or any adjournment thereof, notice of which is set out at the end
                                              of the Circular;

 "Requisitioned Resolutions"                  the resolutions to be proposed at the Requisitioned General Meeting, the full
                                              text of which are set out in the Notice of Requisitioned General Meeting;

 "Shareholders"                               the holders of Ordinary Shares, and the term "Shareholder" shall be construed
                                              accordingly;

 "uncertificated" or "uncertificated form"      means recorded on the relevant register or other record of the share or other
                                              security concerned as being held in uncertificated form in CREST, and title
                                              to which, by virtue of the CREST Regulations, may be transferred by means of
                                              CREST;

 "United Kingdom" or "UK"                     the United Kingdom of Great Britain and Northern Ireland;

 "£" or "Pounds"                              UK pounds sterling, being the lawful currency of the United Kingdom;

 "World High Life"                            World High Life plc.

 

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