REG - Surface Transforms - Proposed Placing, Subscription and Open Offer
01/05/2024 17:45
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RNS Number : 8983M Surface Transforms PLC 01 May 2024
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RELIED ON IN CONNECTION WITH, ANY INVESTMENT DECISION IN RESPECT OF SURFACE
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SURFACE TRANSFORMS PLC
("Surface Transforms" or the "Company")
Proposed Placing and Subscription to raise approximately £6.5 million
(before expenses) via an accelerated bookbuild, and Open Offer to raise up to
a further £2.0 million (before expenses)
Surface Transforms (AIM:SCE), manufacturers of carbon fibre reinforced
ceramic automotive brake discs, is pleased to announce that it proposes to
raise approximately £0.8 million (before expenses) by means of a Firm
Placing and Subscription, and a further £5.7 million (before expenses) by
means of a Conditional Placing (together, the "Placing and Subscription"),
with a total 650,000,000 New Ordinary Shares at 1 pence per New Ordinary
Share. In addition to the Placing and Subscription, the Company proposes to
raise up to a further £2.0 million (before expenses), subject to the Board's
discretion to increase the size of the Open Offer, by way of an Open Offer
(together with the Placing and Subscription, the "Fundraise").
The net proceeds from the Placing and Subscription will be used for immediate
working capital requirements, both in terms of existing operations, but also
the Phase 2 and manufacturing scale-up. Any excess raised pursuant to the Open
Offer will provide additional working capital headroom.
The Placing will be conducted by way of an accelerated bookbuild ("Bookbuild")
which will be launched immediately following this Announcement, in accordance
with the terms and conditions set out in the Appendix to this Announcement.
The Firm Placing will be effected by way of a cashbox placing of new Ordinary
Shares for non-cash consideration, further details of which are set out below.
The cashbox placing structure is being used due to the Issue Price being at a
substantial discount, which would otherwise limit the net proceeds receivable
by the Company given the existing allotment authorities available to the Board
for issuing Ordinary Shares on a non-pre-emptive basis.
KEY HIGHLIGHTS
· Proposed Placing of approximately £6.3 million (before
expenses) with institutional investors, proposed Subscription of £0.2
million by the Directors (before expenses) and certain PDMRs and proposed
Open Offer of up to £2.0 million (before expenses), subject to the Board's
discretion to increase the size of the Open Offer, to existing Qualifying
Shareholders, in each case at the Issue Price.
· The Company intends to use the net proceeds of the proposed
Fundraise for working capital requirements and to support existing operations
and the manufacturing scale-up
· The Issue Price represents a discount of approximately 66 per
cent. to the closing mid-market price of 2.9 pence per Ordinary Share on 30
April 2024, being the last Business Day prior to the date of this
Announcement.
· Zeus is acting as Nominated Adviser and Joint Broker to the
Company and Cavendish is acting as Joint Broker to the Company in connection
with the Fundraise.
· Completion of the Conditional Placing is subject to, inter alia,
the Resolutions being passed at a General Meeting of the Company, expected to
be held at 11.00 a.m. on 23 May 2024.
The timing for the close of the Bookbuild and allocation of the Placing Shares
shall be at the absolute discretion of the Joint Brokers, in consultation with
the Company. The allocation of the Placing Shares between First Admission and
Second Admission shall be at the absolute discretion of the Joint Brokers, in
consultation with the Company. The final number of Placing Shares to be issued
pursuant to the Placing will be agreed by the Joint Brokers and the Company at
the close of the Bookbuild. The result of the Placing will be announced as
soon as practicable thereafter. The Placing is not underwritten.
In addition, the Directors and certain PDMRs have indicated an intention to
participate in the Fundraising (by way of a direct Subscription for
Subscription Shares) as follows:
Director Intended Subscription Number of Subscription Shares
Matthew Taylor £100,000 10,000,000
David Bundred £25,000 2,500,000
Kevin Johnson £25,000 2,500,000
Ian Cleminson £25,000 2,500,000
Julia Woodhouse £25,000 2,500,000
Isabelle Maddock £3,500 350,000
Stephen Easton(1) £15,000 1,500,000
(1)Stephen Easton is the non-Board Chief Operating Officer and a PDMR of the
Company
In addition to the Placing and Subscription, the Company intends to provide
all Qualifying Shareholders with the opportunity to subscribe for an aggregate
of 200,000,000 Open Offer Shares at the Issue Price of 1 pence per Open
Offer Share to raise up to approximately £2.0 million (before expenses),
subject to the Board's discretion to increase the size of the Open
Offer. Qualifying Shareholders subscribing for their full entitlement under
the Open Offer may also request additional Open Offer Shares through an
excess application facility. The Open Offer is not underwritten.
The issue of the Firm Placing Shares and the Subscription Shares are
conditional, inter alia¸ on the Firm Placing Admission. The issue of the
Conditional Placing Shares and the Open Offer Shares are conditional, inter
alia, the passing by Shareholders of the Resolutions at the General Meeting of
the Company, expected to be held at 11.00 a.m. on 23 May 2024.
Shareholders should note that the Conditional Placing and Open Offer are
conditional, inter alia, on the passing of the Resolutions. Failure to approve
the Resolutions would therefore prevent the Company from raising funds
pursuant to the Conditional Placing and Open Offer, and only part of the net
proceeds would be received by the Company. This would require the Company to
seek urgent alternate financing that may or may not be available and, if
available, may or may not be on worse terms than the Fundraising. The
Directors believe that the Resolutions to be proposed at the General Meeting
are in the best interests of the Company and Shareholders as a whole and
unanimously recommend that Shareholders vote in favour of the Resolutions.
A circular containing further details of the Placing, the Subscription and the
Open Offer, Notice of General Meeting, proxy form and Application Form will be
despatched to Shareholders following announcement of the result of the Placing
and Subscription and will thereafter be available on the Company's website
at www.surfacetransforms.com (http://www.surfacetransforms.com/) .
Applications will be made to the London Stock Exchange for the admission of
the Firm and Conditional Placing Shares, Subscription Shares and Open Offer
Shares to be admitted to trading on AIM. Admission of the Firm Placing
Shares and the Subscription Shares is expected to commence at 8.00
a.m. on 7 May 2024 and admission of the Conditional Placing at 8.00 am on 24
May 2024 and the Open Offer Shares at 8.00 am on 28 May 2024.
The New Ordinary Shares, when issued, will be fully paid and will rank pari
passu in all respects with the Existing Ordinary Shares.
The Appendix to this Announcement (which forms part of this Announcement)
contains the detailed terms and conditions of the Placing.
For further information, please contact:
Surface Transforms plc +44 151 356 2141
David Bundred, Chairman
Kevin Johnson, CEO
Isabelle Maddock, CFO
Zeus (Nominated Adviser and Joint Broker) +44 203 829 5000
David Foreman / James Edis / Ed Beddows (Investment Banking)
Dominic King (Corporate Broking)
Cavendish Capital Markets Ltd (Joint Broker) +44 20 7220 0500
Ed Frisby / Abigail Kelly (Corporate Finance)
Andrew Burdis / Harriet Ward (ECM)
Introduction
Surface Transforms announces that it proposes to raise approximately £0.8
million (before expenses) by means of a Firm Placing and Subscription, and a
further £5.7 million (before expenses) by means of a Conditional Placing,
with a total 650,000,000 New Ordinary Shares at 1 pence per New Ordinary
Share. In addition, the Company proposes to raise up to a further £2.0
million (before expenses), subject to the Board's discretion to increase the
size of the Open Offer, by way of an Open Offer.
The Conditional Placing is conditional the passing of the Resolutions and the
Conditional Placing Admission.
Background to and reasons for the Fundraising
Surface Transforms has announced a Placing and Subscription raising gross
proceeds of £6.5 million, together with an Open Offer to raise up to £2.0
million (before expenses). The net proceeds of the Fundraising will be used
for immediate working capital requirements and to support existing operations
and the manufacturing scale-up.
It is important to note that Surface Transforms already has a secured and
prospective customer pipeline for approximately £700 million(1) of sales, of
which approximately £390 million(2) is contracted. Over the next three years
(and potentially beyond), Surface Transforms expect to be able to sell as many
discs as it can manufacture. Related to which, the Board continues to target
increasing factory capacity to £75 million(3) sales per annum over the next
few years with a medium-term target of £150 million(3) per annum. However,
and as recent trading statements released by the Company have shown, improving
manufacturing resilience is at least as important as the capacity scale-up,
and operational management, led by the Company's Chief Executive, Kevin
Johnson and new Chief Operating Officer, Stephen Easton, are addressing this.
The Company raised £11.0 million (gross) in Q4-2023 with the expectation that
the net proceeds of that fundraising (together with the £13.2 million Loan
Facility entered into in December 2023) and estimated future operating cash
inflows, would be sufficient to deliver an expanded plant capable of
delivering the medium-term target of £150 million(3) sales per annum. Due to
a combination of factors, which are described further below, this is not
currently the case, and the Company requires the net proceeds from the
Fundraising for short-term working capital purposes, which once resolved, will
mean the medium-term opportunity can once again be fully focused upon and
delivered.
The Board is acutely aware of shareholder frustrations with the need for this
Fundraising, not least given the proximity to the previous equity fundraise
completed by the Company in Q4-2023, but the Directors do therefore want to
remind Shareholders of:
- the automotive market drivers and recent progress
with the Company's OEM customers;
- the Company's manufacturing strategy including
progress on installing new capacity; and
- how such drivers and progress translate into
recent and forecast revenues.
which are considered in turn in more detail below.
Finally, each member of the Board and one non-Board PDMR have indicated an
intention to subscribe for a total of 21,850,000 New Ordinary Shares pursuant
to the subscription. The Directors have also irrevocably undertaken to vote in
favour of all the Resolutions to be proposed at the General Meeting in respect
of their own beneficial holdings amounting to in aggregate 5,402,757 Ordinary
Shares, representing approximately 1.53 per cent. of the Existing Ordinary
Shares.
Automotive market drivers
Surface Transforms produce lightweight carbon ceramic brake discs for the
automotive industry. Historically, iron discs have been utilised. However,
there are compelling drivers for the increasing adoption of carbon ceramic
brakes, with the likes of AMG, Aston Martin, Audi, Bentley, BMW, General
Motors, Ferrari, Jaguar Land Rover, Lamborghini, Lucid, Koenigsegg, McLaren,
Nissan, Porsche, Tesla and VW who are now offering carbon ceramic brakes on
selected vehicles.
The drivers for the adoption of carbon ceramic brakes are multi-faceted and
include:
· Technological: carbon ceramic discs provide superior braking
performance than iron discs being both stronger and more durable as well as
being able to dissipate more heat - increased heat evacuation reduces the
brake temperature which improves performance. In addition, carbon ceramic
discs can be up to 70 per cent. lighter - in certain instances each carbon
ceramic brake disc is 25 kg lighter resulting in a total chassis weight
reduction of 100 kg;
· Environmental: reduced chassis weight results in lower CO2
emissions. In addition, carbon ceramic discs produce significantly less brake
pad dust pollution than iron discs, an increasingly important issue for
regulators;
· Competition: Brembo SGL are currently the leading carbon ceramic
brake disc manufacturer by volume and have historically enjoyed a near
monopolistic position. Automotive OEMs desire de-risked supply arrangements
wherever possible. The Board consider Surface Transforms to be the only
credible alternative supplier of carbon ceramic brakes to Brembo SGL, and
anticipate this to be the situation for some time;
· Lifetime and total cost of ownership: Carbon ceramic discs last
approximately four times longer than iron discs. This increased service life
therefore has a commensurate reduction in the total cost of ownership;
· Quality: Carbon ceramic discs provide enhanced handling, comfort
and performance compared with heavier iron discs. Furthermore, carbon ceramic
discs materially reduce the prospect of galvanic corrosion, a safety concern
for grey iron discs on EVs;
· Aesthetics: Carbon ceramic discs are desirable, especially when
combined with colourful calipers, and because they do not corrode like iron
discs, they generate significantly less brake dust resulting in cleaner
wheels, and unlike iron discs do not rust;
· Shift to EV: The EV market is becoming more prominent in the
wider automotive space, led by stringent rules in the EU, California and Japan
to reduce carbon emissions. In addition to the above, weight saving on EVs can
lead to smaller and potentially cheaper batteries.
While there are substantial market drivers outlined above, the considerable
testing requirements of the OEMs continue to limit the competition. Surface
Transforms is currently taking market share from both Brembo SGL and iron disc
manufacturers, and expects to continue to win new contracts during the coming
years.
Progress with OEM customers
Surface Transforms' growth continues to be driven by contracting directly with
OEMs to supply carbon ceramic brake discs for upcoming models. The Company has
12 nominated OEM contracts, with an expected total lifetime value of £390
million(4), equating to £79 million(5) per annum. This includes the most
recent nomination with OEM 10, expected to result in £100 million(6) of
lifetime value.
Of the 12 nominated OEM contracts, five are in a multi-year revenue generation
phase with the remaining contracts expected to enter SOP at regular intervals
between now and 2027.
In addition, expected revenue continues to grow through "follow on" contracts,
in which OEM customers use existing product approvals on their future models.
The Company's strategy is to achieve annual revenue of £100 million(7) within
the next five years, with a PCP of £300 million, which includes other
potential customers alongside awarded and nominated contracts.
Whilst there can be no guarantee that Surface Transforms will be awarded any
further supply contracts to any of the OEMs or, even if awarded, what the
actual vehicle volumes will transpire to be, the Board note their continuing
success winning new contracts, particularly follow on contracts.
Whilst Surface Transforms can fulfil its existing supply contracts through
existing, and planned increases in manufacturing capacity through 2024 and
2025 at the Company's Knowsley facility, there remains insufficient resilience
and future capacity expansion will be required to deliver the PCP, should
these be converted into actual contract awards.
Manufacturing strategy
During Q1 2024, the Company continued to progress its three-phased
manufacturing capacity scale-up, building on Phase 1 which provides a revenue
capacity of £20 million per annum.
The Company has commenced Phase 2, which is expected to increase production
capacity to £75 million(8) per annum by 2025, with a capital cost of £14
million. Phase 2 comprises two parts, with Part 1 anticipated to be available
for production in 2024 and Part 2 remaining on course to be completed and
available for production in 2025. Part 1 will increase production capacity to
£50 million(8) per annum, helping support 2024 customer demand and provide
the necessary resilience to mitigate the risk of and/or overcome single points
of failure. The Company has to date invested £6 million into Phase 2, with
the balance to be financed by the Loan Facility which was secured in December
2023.
Phase 3 of the manufacturing strategy is to increase revenue to £150
million(8) per annum through the expansion of the factory on an adjacent 2
acre site. Phase 3 is expected to be completed by 2027, with an expected
capital cost of £30 million, being financed by the Loan Facility and retained
cash flows generated from operations.
Progress on installing Phase 2 new capacity
Part 1 of Phase 2 is proceeding to plan with all but one of the furnaces to be
on site by mid-2024. The last furnace is slightly delayed, not due to an issue
with the furnace itself, but due to protracted negotiations regarding the site
expansion including the positioning of this last furnace, which have now
concluded.
Capacity increases can also be achieved by internal work on already installed
furnaces which can, over time, be substantial. The Company has a number of
internal work projects underway; they are progressing well and form part of
2024 capacity contingency plans.
Manufacturing yield
Date 2023 Q1-2024 Q2-2024 Q3-2024 Q4-2024 H1-25 H2-25 Strategic Goal
Yield 47% 75% 83% 85% 86% 88% 90% 99%
As described in the section below, production has been constrained with
manufacturing yields too low, due to high scrappage rates, primarily in
Q1-2024. A dedicated team, overseen by Stephen Easton, Chief Operating
Officer, have completed a large number of process refinements during FY 2023
and Q1 2024, as shown in the below chart. Moreover, there remains a detailed
programme of further quarterly initiatives to be performed throughout 2024 and
2025.
Production stability
Process refinements have been introduced and managed to address the objectives
of building capacity, improving yield and reducing costs. The vast majority of
these refinements for FY 2024 and beyond have already been explicitly
identified, which combined with recent successful implementations, gives
management confidence that these further process improvements will generate
improved manufacturing yields during FY 2024 and FY 2025, enhance capacity and
reduce costs.
Date Avg 2023/Q Q1-2024 Q2-2024 Q3-2024 Q4-2024 H1-25 H2-25 Strategic Goal
# Process Refinements 72 42 16 15 25 5 8 5
Cost reductions
The above initiatives as well as other specific projects will enable the
Company to reduce manufacturing costs per disc, as set out in the table below:
Date 2023 Q1-2024 Q2-2024 Q3-2024 Q4-2024 Q1-2025 Q2-2025 Q3-2025 Strategic Goal
Cost reduction saving/disc (£) (56) (32) 48 60 60 100 125 150 210
Utilisation of proceeds for the 6 months to the end of Q1 2024
The Company raised net proceeds of £10.1 million in Q4-2023 which have
primarily been utilised against management budgets at the time, as follows:
Foregone contribution from missed sales during FY 2024 to date £1.5 million
Combined cost of scrappage, both foregone contribution of lost sales and sunk £2.4 million
cost of production through to point of scrappage
Increased development and other overhead costs supporting scale-up, including £1.2 million
tooling and repairs and maintenance to resolve certain single points of
failure but particularly in understanding and conducting programmes to reduce
scrappage rates
Loan Financing - timing differences to originally assumed cash phasing £3.5 million
Positive working capital variance - linked to Q1-2024 activity being lower (£1.9 million)
than originally forecast
The combination of the above factors, namely foregone sales contribution,
increased costs and certain adverse timing differences, have resulted in the
Company being working capital constrained.
Reasons for the Fundraising
For the reasons set out above, the Company has been and expects to continue to
be working capital constrained in the absence of a cash injection.
Accordingly, the proposed Placing and Subscription raising net proceeds of
approximately £6.0 million will support the immediate working capital
requirements of the Company, both in terms of existing operations, but also
the Phase 2 and manufacturing scale-up. Any excess raised pursuant to the Open
Offer will provide additional working capital headroom. The Company does not
currently anticipate requiring any further external funding for future
expansion up to and including Phase 3 of the manufacturing scale-up but will
likely explore non-equity options in the first instance should any further
external funding be required.
The Board has considered various options to address this short term working
capital constraint and concluded that an equity fundraising is the optimal
solution, acknowledging that at the Issue Price, the proposed Placing and
Subscription will be significantly dilutive to Existing Shareholders.
Accordingly, the Board intends to propose the Open Offer to allow its
supporting Existing Shareholders (who are also Qualifying Shareholders) the
opportunity to participate in the Fundraising through the Open Offer and
minimise dilution.
Trading update and outlook
As recently reported in the Company's RNS announcement on 17 April 2024
entitled "2024 Sales Outlook", sales are anticipated to grow between 111 - 165
per cent. in FY 2024 (compared to FY 2023 sales of £8.3 million) resulting in
a projected FY 2024 range of £17.5 million to £22 million sales.
Sales were constrained in Q1-2024 due primarily to continuing high levels of
scrap from processes that are not yet fully capable. Significant progress has
been made in reducing scrap and this is expected to continue through 2024,
unlocking further capacity. Similarly, progress on expanding the Company's
capacity during 2024 is advancing. These three activities are all boosting
sales which the Board maintain will drive the Company's rapid growth during
the year.
Management have detailed plans in place to continue to drive all three areas
with the pace of progress determining a current spread in expected revenues
for FY 2024 of between £17.5 million and £22 million. With continuing
improvements in scrappage rates and generally better visibility on customer
deliveries, the Board expect this sales range to narrow, and the Company will
provide updates on progress throughout the year.
The Company's ambition remains generating revenues of £100 million(9) per
annum within the next five years. The below table sets out actual FY 2023 and
Q1 2024 revenues together with management expectations through Q2 2025, set
against the targeted £25 million quarterly revenue:
Date Q1-2023 Q2-2023 Q3-2023 Q4-2023 Q1-2024 Q2-2024 Q3-2024 Q4-2024 Q1-2025 Q2-2025 Strategic Goal
Quarterly Revenues (£m) 1.4 1.9 2.0 3.0 3.0 4.0 4.8 5.8 7.0 7.0 25.0
These quarterly revenues (above) need to be viewed against the effective
revenue capacity of the Company during the same period (as set out in the
below table):
Date Avg 2023 Q1-2024 Q2-2024 Q3-2024 Q4-2024 Q1-2025 Q2-2025 Strategic Goal
Effective Capacity Revenue (£m) 2.0 3.0 7.0 7.0 9.0 10.0 11.0 38.0
Sales in Q1 2024 were £3.0 million. Accepting that £3.0 million maintained
the Company's quarterly revenue rate rather than increasing it, sales in
Mar-24 were £1.5 million. Furthermore, significant improvements in the
underlying operational performance, led by Stephen Easton, Chief Operating
Officer, have also been achieved. The single point of failure capacity
constraints have now, almost all, been resolved, the revised maintenance
procedures and continuing operator training have significantly improved plant
availability, and performance.
The Company has also agreed revised 2024 delivery schedules with all customers
that progressively pull back arrears. The Company is broadly keeping to these
schedules and the Board are of the view that the customer situation is stable.
In April 2024, the Company agreed revised financial covenants for the Loan
Facility, with updated banking documentation currently being prepared.
Management's low-case estimates (with FY24 sales of £17.5 million) include
approximately £10.45 million total use of the Loan Facility by the end of the
two-year drawdown period ending 31 December 2025. Under such scenario,
management anticipate they would request an extension of the Loan Facility to
utilise any undrawn amounts during FY26. If the financial performance of the
Company exceeds this low-case forecast, management expect the full £13.2
million will be drawn down.
Board change
David Bundred, Chairman, has confirmed that after 12 years on the Board, he
intends to retire from this role in 2024. A search process has now started,
led by Julia Woodhouse, independent non-executive director. Further updates
will be provided in due course.
The Placing and Subscription
The Company intends to raise £0.8 million (before expenses), and
conditionally raise a further £5.7 million (before expenses), by means of the
Placing and Subscription of 650,000,000 new Ordinary Shares, which are not
subject to clawback, at the Issue Price for the benefit of the Company.
The Placing Shares and the Subscription Shares, when issued and fully paid,
will rank equally in all respects with the Existing Ordinary Shares.
The Firm Placing will be effected by way of a cashbox placing of New Ordinary
Shares for non-cash consideration. The cashbox structure is expected to have
the effect of providing the Company with the ability to realise distributable
reserves approximately equal to the net proceeds of the Firm Placing less the
nominal value of the Firm Placing Shares issued by the Company.
Zeus will, pursuant to the Subscription and Transfer Agreements, subscribe for
redeemable preference shares in Bumblebee Finance (Jersey) Limited a new
Jersey-incorporated subsidiary of the Company ("JerseyCo") in an amount equal
to the gross proceeds of the Firm Placing. Monies received from Placees taking
up Firm Placing Shares will be applied by Zeus to subscribe for redeemable
preference shares in JerseyCo.
The Company will allot and issue the Firm Placing Shares on a non-pre-emptive
basis to Placees who have participated in the Firm Placing in consideration
for the transfer, pursuant to the terms of the Subscription and Transfer
Agreements, of the redeemable preference shares in JerseyCo that will be
issued to Zeus. Accordingly, at the conclusion of this cashbox placing
process, JerseyCo will be a wholly owned subsidiary of the Company and its
principal assets will be cash reserves approximately equal to the gross
proceeds of the Firm Placing. Shareholder approval is not required to effect
the Firm Placing by way of a cashbox placing.
Instead of receiving cash as consideration for the issue of the Firm Placing
Shares, following completion of the Firm Placing, the Company will own the
entire issued share capital of JerseyCo, whose only asset will be its cash
reserves as noted above. The Company will then be able to access those funds
by redeeming the redeemable preference shares it holds in JerseyCo.
Accordingly, by subscribing for the Firm Placing Shares under the Firm Placing
and submitting a valid payment in respect thereof, each Placee instructs Zeus
to hold such payment on their respective behalves and: (i) to the extent of a
successful application under the Firm Placing, to apply such payment solely to
permit Zeus to subscribe (as principal) for redeemable preference shares in
JerseyCo; and (ii) to the extent of an unsuccessful application under the Firm
Placing, to return the relevant payment without interest to the Placee.
The Subscription is a private subscription at the Issue Price with
Subscription Letters between the Company and each of the Directors and one
non-Board PDMR of the Company. The Subscription Shares will be issued at Firm
Placing Admission under the Company's existing allotment authorities obtained
at the Company's general meeting held on 18 December 2023.
The Placing Agreement
Pursuant to the terms of the Placing Agreement, Zeus and Cavendish, as agents
to the Company, have conditionally agreed to use their reasonable endeavours
to procure Placees for the Placing Shares to be issued under the Placing. The
Firm Placing is conditional, inter alia, upon neither of the Joint Brokers
having exercised their right to terminate the Placing Agreement and the Firm
Placing Admission occurring not later than 8.00 a.m. on 7 May 2024. The Firm
Placing is not conditional on the Resolutions being passed at the GM. Once the
Firm Placing Admission has occurred, neither of the Joint Brokers will have
the right to terminate any of its obligations under the Placing Agreement with
regard to the Firm Placing, but may at any time up to the Conditional Placing
Admission terminate its obligations under the Placing Agreement as regards the
Conditional Placing.
The Conditional Placing is conditional, inter alia, upon the Firm Placing
Admission having occurred not later than 8.00 am on 7 May 2024, the
Resolutions being passed at the GM without amendment, the Company having full
performed its obligations under the Placing Agreement to the extent that they
fall to be performed prior to the Conditional Placing Admission, the Placing
Agreement becoming unconditional and not being terminated in accordance with
its terms and, the Conditional Placing Admission occurring by no later than
8.00 a.m. on 24 May 2024 (or such later date as the Company and the Joint
Brokers may agree, being no later than 8.00 a.m. on 11 June 2024). Once the
Conditional Placing Admission has occurred, no party to the Placing Agreement
can terminate any part of the Placing Agreement which relates to the
Conditional Placing Admission and/or the Placing, allotment and/or issue of
the shares subject to the Conditional Placing Admission.
The Subscription and Transfer Agreements
In connection with the Firm Placing, (a) the Company, Zeus and JerseyCo have
entered into a subscription and transfer agreement and (b) the Company and
Zeus have entered into a put and call option agreement (together the
"Subscription and Transfer Agreements"), each agreement being dated on or
around the date of the Placing Agreement, in relation to the subscription and
transfer of the redeemable preference shares in JerseyCo to the Company.
Under the terms of the Subscription and Transfer Agreements:
(a) the Company and Zeus will acquire ordinary shares in
JerseyCo;
(b) the Company and Zeus have entered into certain put and
call options in respect of the ordinary shares in JerseyCo subscribed for by
Zeus that are exercisable if the Firm Placing does not complete;
(c) Zeus will apply monies received from Placees under the
Firm Placing, to subscribe for redeemable preference shares in JerseyCo to an
aggregate value equal to such monies; and
(d) the Company will allot and issue the Firm Placing Shares
to those persons entitled to them in consideration of Zeus transferring its
holding of redeemable preference shares and ordinary shares in JerseyCo to the
Company.
Placees and Qualifying Shareholders are not party to these arrangements and so
will not acquire any direct right against Zeus pursuant to these arrangements.
The Company will be responsible for enforcing the obligations of Zeus under
these arrangements.
Director and non-Board PDMR Participation in the Fundraising
The Directors and PDMRs have indicated an intention to participate in the
Subscription by way of a direct Subscription, as follows:
Director Intended Subscription Number of Subscription Shares
Matthew Taylor £100,000 10,000,000
David Bundred £25,000 2,500,000
Kevin Johnson £25,000 2,500,000
Ian Cleminson £25,000 2,500,000
Julia Woodhouse £25,000 2,500,000
Isabelle Maddock £3,500 350,000
Stephen Easton(1) £15,000 1,500,000
(1)Stephen Easton is the non-Board Chief Operating Officer and a PDMR of the
Company
The Subscription Shares, when issued and fully paid, will rank equally in all
respects with the Existing Ordinary Shares. The Subscription is conditional
upon, inter alia, the Firm Placing Admission.
Application will be made to the London Stock Exchange for admission of the
Subscription Shares to trading on AIM. Admission of the Subscription Shares is
expected to take place, and dealings on AIM are expected to commence, at 8.00
a.m. on 7 May 2024.
Open Offer
In order to provide all Qualifying Shareholders with an opportunity to
participate, the Company is conducting an Open Offer providing those
shareholders the opportunity to subscribe at the Issue Price for an aggregate
of 200,000,000 Open Offer Shares. The Board has discretion to increase the
size of the Open Offer up to an aggregate of 300,000,000 Open Offer Shares.
This allows Qualifying Shareholders to participate on a pre-emptive basis
whilst providing the Company with the flexibility to raise additional equity
capital to further improve its financial position.
Qualifying Shareholders are being offered the opportunity to apply through the
Excess Application Facility for additional Open Offer Shares in excess of
their pro rata entitlements to the extent that other Qualifying Shareholders
do not take up their entitlements in full. Qualifying Shareholders with nil
basic entitlement will still be eligible to apply for Open Offer Shares under
the Excess Application Facility. In the event of applications in excess of the
maximum number of Open Offer Shares available, the Company will decide on the
basis for allocation, however, if this scenario occurs, preference is likely
to be given to Qualifying Shareholders with smaller shareholdings (who
historically may have had less opportunity to participate in placings
conducted by the Company). The Open Offer Shares will not have been placed
subject to clawback nor have they been underwritten. Consequently, there may
be fewer than 200,000,000 Open Offer Shares issued pursuant to the Open Offer.
The Open Offer provides Qualifying Shareholders the opportunity to participate
in the Fundraising, up to £2.0 million worth of Open Offer Shares to be
issued at the Issue Price. The Open Offer is being made on the basis of 1 Open
Offer Share for every 1.760363190 Existing Ordinary Shares held by Qualifying
Shareholders on the Record Date. However, should the Open Offer be
significantly oversubscribed, the Directors may, at their absolute discretion,
increase the Open Offer up to a maximum aggregate amount of £3.0 million
worth of Open Offer Shares to be issued at the Issue Price.
The Conditional Placing and the Open Offer are conditional upon, inter alia,
the Firm Placing Admission having occurred not later than 8.00 am on 7 May
2024, the approval of Shareholders of the Resolutions at the General Meeting
and upon the Placing Agreement becoming unconditional in all respects (other
than as to the Conditional Placing Admission and the Open Offer Admission (as
the case may be)) and not having been terminated in accordance with its terms.
Investor presentation
The Company will provide a live presentation to investors and any other
interested parties via Hardman & Co's platform at 12.00 noon on 9 May
2024. Interested parties can register for the presentation at
https://us06web.zoom.us/webinar/register/WN_mUnp-l2KTomKBRFgUhFEow
(https://url.uk.m.mimecastprotect.com/s/6Y0GC7LEPSA7W5Mf8Pj-3?domain=eu-west-1.protection.sophos.com)
Surface Transforms is committed to ensuring that there are appropriate
communication structures for all its Shareholders. Questions can be submitted
in advance as well as during the event via the "Ask a Question" function.
Although management may not be in a position to answer every question
received, they will address the most prominent ones within the confines of
information already disclosed to the market.
Expected timetable of principal events
Record Date 1 May 2024
Announcement of the Fundraising 1 May 2024
Announcement of the result of the Placing and the Subscription 2 May 2024
Despatch of the Circular 3 May 2024
Admission of the Firm Placing Shares and Subscription Shares 8.00 a.m. on 7 May 2024
Announcement of the results of the General Meeting 23 May 2024
Announcement of the result of the Open Offer by 24 May 2024
Announcement of the result of the Open Offer by 24 May 2024
Admission of the Conditional Placing Shares 8.00 a.m. on 24 May 2024
Admission of the Open Offer Shares 8.00 a.m. on 28 May 2024
Irrevocable commitments
The Directors (or persons connected with the Directors within the meaning of
sections 252 - 255 of the Act), who in aggregate hold 5,402,757 Existing
Ordinary Shares, representing approximately 1.53 per cent. of the Existing
Ordinary Shares, have irrevocably undertaken to vote in favour of the
Resolutions at the General Meeting and not to subscribe for any of the Open
Offer Shares.
Important information
This Announcement is for information purposes only and does not itself
constitute an offer or invitation to underwrite, subscribe for or otherwise
acquire or dispose of any securities in the Company and does not constitute
investment advice.
Neither this Announcement nor any copy of it may be taken or transmitted,
published or distributed, directly or indirectly, in or into the United
States, Australia, New Zealand, Canada, Japan or the Republic of South
Africa or to any persons in any of those jurisdictions or any other
jurisdiction where to do so would constitute a violation of the relevant
securities laws of such jurisdiction. Any failure to comply with this
restriction may constitute a violation of the securities laws of any state or
territory of the United States, Australia, New Zealand, Canada, Japan or
the Republic of South Africa. The distribution of this Announcement in other
jurisdictions may be restricted by law and persons into whose possession this
Announcement comes should inform themselves about, and observe any such
restrictions.
Any failure to comply with these restrictions may constitute a violation of
the securities laws of any such jurisdiction. Neither this Announcement nor
any part of it nor the fact of its distribution shall form the basis of or be
relied on in connection with or act as an inducement to enter into any
contract or commitment whatsoever.
In particular, the Placing Shares, the Subscription Shares and the Open Offer
Shares have not been and will not be registered under the US Securities Act,
or under the securities laws or with any securities regulatory authority of
any state or other jurisdiction of the United States, and accordingly the
Placing Shares, the Subscription Shares and the Open Offer Shares may not be
offered, sold, pledged or transferred, directly or indirectly, in, into or
within the United States except pursuant to an exemption from the
registration requirements of the US Securities Act and the securities laws of
any relevant state or other jurisdiction of the United States. There is no
intention to register any portion of the Fundraising in the United States or
to conduct a public offering of securities in the United States or
elsewhere.
Zeus is authorised and regulated in the United Kingdom by the FCA and is
acting as nominated adviser and Joint Broker to the Company in respect of the
Fundraising. Cavendish is authorised and regulated in the United Kingdom by
the FCA and is acting as Joint Broker to the Company in respect of the
Fundraising. Each of Zeus and Cavendish is acting for the Company and for
no-one else in connection with the Fundraising, and will not be treating any
other person as its client in relation thereto, and will not be responsible
for providing the regulatory protections afforded to its customers nor for
providing advice in connection with the Fundraising or any other matters
referred to herein and apart from the responsibilities and liabilities (if
any) imposed on Zeus or Cavendish, as the case may be, by FSMA, any liability
therefor is expressly disclaimed. Any other person in receipt of this
Announcement should seek their own independent legal, investment and tax
advice as they see fit.
Forward-looking statements
This Announcement contains statements about Surface Transforms that are, or
may be deemed to be, "forward-looking statements".
All statements, other than statements of historical facts, included in this
Announcement may be forward-looking statements. Without limitation, any
statements preceded or followed by, or that include, the words "targets",
"plans", "believes", "expects", "aims", "intends", "will", "may", "should",
"anticipates", "estimates", "projects", "would", "could", "continue" or words
or terms of similar substance or the negative thereof, are forward-looking
statements. Forward-looking statements include, without limitation, statements
relating to the following: (i) future capital expenditures, expenses,
revenues, earnings, synergies, economic performance, indebtedness, financial
condition, dividend policy, losses and future prospects and (ii) business and
management strategies and the expansion and growth of the operations
of Surface Transforms.
These forward-looking statements are not guarantees of future performance.
These forward-looking statements involve known and unknown risks,
uncertainties and other factors which may cause the actual results,
performance or achievements of any such person, or industry results, to be
materially different from any results, performance or achievements expressed
or implied by such forward-looking statements. These forward-looking
statements are based on numerous assumptions regarding the present and future
business strategies of such persons and the environment in which each will
operate in the future. Investors should not place undue reliance on such
forward-looking statements and, save as is required by law or regulation
(including to meet the requirements of the AIM Rules for Companies, the
Prospectus Rules, the FSMA and/or MAR), does not undertake any obligation to
update publicly or revise any forward-looking statements (including to reflect
any change in expectations with regard thereto or any change in events,
conditions or circumstances on which any such statement is based). All
subsequent oral or written forward-looking statements attributed to Surface
Transforms or any persons acting on their behalf are expressly qualified in
their entirety by the cautionary statement above. All forward-looking
statements contained in this Announcement are based on information available
to the Directors at the date of this Announcement, unless some other time is
specified in relation to them, and the posting or receipt of this Announcement
shall not give rise to any implication that there has been no change in the
facts set forth herein since such date.
References
1. Based on the Directors' expectations of existing customer
contracts and their understanding of the relevant OEM's production plan and
estimated demand for discs.
2. Based on the Directors' expectations and their understanding
of the relevant OEM's production plan and estimated demand for discs and it
takes into account the expected lifetime revenue from the Company's contract
with OEM which is anticipated to be entered into following the Company's
recent nomination as OEM 10's tier one supplier of a carbon ceramic brake
discs.
3. Based on the Directors' estimates of sales proceeds from
expected production volumes.
4. Based on the Directors' expectations and their understanding
of the relevant OEM's production plan and estimated demand for discs and it
takes into account the expected lifetime revenue from the Company's contract
with OEM which is anticipated to be entered into following the Company's
recent nomination as OEM 10's tier one supplier of a carbon ceramic brake
discs.
5. Based on the directors' expectations, their understanding of
the relevant OEMs production plans and an assumed disc demand
6. The Directors believe that based on existing customer
contracts and PCPs, the current capacity will not provide the required
production capacity to meet demands from OEMs
7. Based on the Directors' expectations of sales proceeds from
expected production volumes for existing customer contracts and PCPs.
8. Based on the Directors' estimates of sales proceeds from
expected production volumes.
9. Based on the Directors' expectations of sales proceeds from
expected production volumes for existing customer contracts and PCP.
APPENDIX
TERMS AND CONDITIONS OF THE PLACING
IMPORTANT INFORMATION FOR INVITED PLACEES ONLY REGARDING THE PLACING.
MEMBERS OF THE PUBLIC ARE NOT ELIGIBLE TO TAKE PART IN THE PLACING. THE
ANNOUNCEMENT REGARDING THE PLACING (THE "ANNOUNCEMENT") AND THE TERMS AND
CONDITIONS SET OUT HEREIN ("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
("EEA"), QUALIFIED INVESTORS AS DEFINED IN ARTICLE 2(e) OF REGULATION (EU)
2017/1129 (THE "EU PROSPECTUS REGULATION"); (B) IF IN THE UNITED KINGDOM,
QUALIFIED INVESTORS AS DEFINED IN ARTICLE 2(e) OF REGULATION (EU) 2017/1129
WHICH FORMS PART OF DOMESTIC LAW PURSUANT TO THE EUROPEAN UNION (WITHDRAWAL)
ACT 2018 (THE "UK PROSPECTUS REGULATION") WHO ALSO (I) FALL WITHIN ARTICLE
19(5) OF THE FINANCIAL SERVICES AND MARKETS ACT 2000 (FINANCIAL PROMOTION)
ORDER 2005, AS AMENDED (THE "ORDER") (INVESTMENT PROFESSIONALS); (II) FALL
WITHIN ARTICLE 49(2)(a) TO (d) (HIGH NET WORTH COMPANIES, UNINCORPORATED
ASSOCIATIONS, ETC.) OF THE ORDER; OR (C) PERSONS TO WHOM THEY MAY OTHERWISE
LAWFULLY BE COMMUNICATED (ALL SUCH PERSONS TOGETHER BEING REFERRED TO AS
"RELEVANT PERSONS").
THE ANNOUNCEMENT AND THE TERMS AND CONDITIONS AND THE INFORMATION THEREIN MUST
NOT BE ACTED ON OR RELIED ON BY PERSONS WHO ARE NOT RELEVANT PERSONS.
PERSONS DISTRIBUTING THE ANNOUNCEMENT AND/OR THE TERMS AND CONDITIONS MUST
SATISFY THEMSELVES THAT IT IS LAWFUL TO DO SO. ANY INVESTMENT OR INVESTMENT
ACTIVITY TO WHICH THE TERMS AND CONDITIONS RELATE IS AVAILABLE ONLY TO
RELEVANT PERSONS AND WILL BE ENGAGED IN ONLY WITH RELEVANT PERSONS. THE
ANNOUNCEMENT AND THE TERMS AND CONDITIONS DO NOT THEMSELVES CONSTITUTE AN
OFFER FOR SALE OR SUBSCRIPTION OF ANY SECURITIES IN SURFACE TRANSFORMS PLC.
THE PLACING SHARES HAVE NOT BEEN AND WILL NOT BE REGISTERED UNDER THE UNITED
STATES SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT") OR UNDER THE
APPLICABLE SECURITIES LAWS OR WITH ANY SECURITIES REGULATORY AUTHORITY OF ANY
STATE OR JURISDICTION OF THE UNITED STATES, AND MAY NOT BE OFFERED, SOLD,
PLEDGED OR OTHERWISE TRANSFERRED, DIRECTLY OR INDIRECTLY, IN THE UNITED STATES
EXCEPT PURSUANT TO AN EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE
REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND IN COMPLIANCE WITH ANY
APPLICABLE SECURITIES LAWS OF ANY STATE OR OTHER JURISDICTION OF THE UNITED
STATES. THE PLACING SHARES ARE BEING OFFERED AND SOLD ONLY OUTSIDE THE
UNITED STATES IN "OFFSHORE TRANSACTIONS" WITHIN THE MEANING OF, AND IN
ACCORDANCE WITH, REGULATION S UNDER THE SECURITIES ACT AND OTHERWISE IN
ACCORDANCE WITH APPLICABLE LAWS. NO PUBLIC OFFERING OF THE PLACING SHARES IS
BEING MADE IN THE UNITED STATES OR ELSEWHERE.
THE ANNOUNCEMENT AND THE TERMS AND CONDITIONS ARE RESTRICTED AND ARE NOT FOR
RELEASE, PUBLICATION OR DISTRIBUTION, IN WHOLE OR IN PART, DIRECTLY OR
INDIRECTLY, IN OR INTO OR FROM THE UNITED STATES, AUSTRALIA, NEW ZEALAND,
CANADA, THE REPUBLIC OF SOUTH AFRICA, OR JAPAN OR ANY OTHER JURISDICTION IN
WHICH SUCH RELEASE, PUBLICATION OR DISTRIBUTION WOULD BE UNLAWFUL.
The distribution of the Announcement and/or the Terms and Conditions and/or
the Placing and/or issue of the Placing Shares in certain jurisdictions may be
restricted by law. No action has been taken by the Company, the Joint
Bookrunners or any of their respective affiliates, agents, directors, officers
or employees that would permit an offer of the Placing Shares or possession or
distribution of the Announcement and/or the Terms and Conditions or any other
offering or publicity material relating to such Placing Shares in any
jurisdiction where action for that purpose is required. Persons into whose
possession the Announcement and/or these Terms and Conditions come are
required by the Company and the Joint Bookrunners to inform themselves about
and to observe any such restrictions.
The Announcement and these Terms and Conditions or any part of them are for
information purposes only and do not constitute or form part of any offer to
issue or sell, or the solicitation of an offer to acquire, purchase or
subscribe for, any securities in the United States, Australia, New Zealand,
Canada, the Republic of South Africa or Japan or any other jurisdiction in
which the same would be unlawful. No public offering of the Placing Shares
is being made in any such jurisdiction.
In the United Kingdom, the Announcement and these Terms and Conditions are
being directed solely at persons in circumstances in which section 21(1) of
the Financial Services and Markets Act 2000 (as amended) (the "FSMA") does not
apply.
The Placing Shares have not been approved or disapproved by the US Securities
and Exchange Commission, any state securities commission or other regulatory
authority in the United States, nor have any of the foregoing authorities
passed upon or endorsed the merits of the Placing or the accuracy or adequacy
of the Announcement and these Terms and Conditions or the Circular. Any
representation to the contrary is a criminal offence in the United States. The
relevant clearances have not been, nor will they be, obtained from the
securities commission of any province or territory of Canada, no prospectus
has been lodged with, or registered by, the Australian Securities and
Investments Commission or the Japanese Ministry of Finance; the relevant
clearances have not been, and will not be, obtained for the South Africa
Reserve Bank or any other applicable body in the Republic of South Africa in
relation to the Placing Shares and the Placing Shares have not been, nor will
they be, registered under or offering in compliance with the securities laws
of any state, province or territory of Australia, New Zealand, Canada, the
Republic of Ireland, the Republic of South Africa or Japan. Accordingly, the
Placing Shares may not (unless an exemption under the relevant securities laws
is applicable) be offered, sold, resold or delivered, directly or indirectly,
in or into Australia, New Zealand, the Republic of Ireland, the United States,
Canada, the Republic of South Africa or Japan or any other jurisdiction in
which such offer, sale, re-sale or delivery would be unlawful.
Persons (including, without limitation, nominees and trustees) who have a
contractual right or other legal obligations to forward a copy of the
Announcement (or any part of it) and/or these Terms and Conditions should seek
appropriate advice before taking any action.
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 ("MiFID II Delegated Directive"); and (c)
local implementing measures, (including insofar as MiFID II and the MiFID II
Delegated Directive constitute retained EU law (as defined in section 6(7) of
the European Union (Withdrawal) Act 2018) in the United Kingdom) ("Retained
MiFID Provisions") (together, the "MiFID II Product Governance
Requirements"), and disclaiming all and any liability, whether arising in
tort, contract or otherwise, which any "manufacturer" (for the purposes of the
MiFID II Product Governance Requirements) may otherwise have with respect
thereto, the Placing Shares have been subject to a product approval process,
which has determined that the Placing Shares are: (i) compatible with an end
target market of (a) retail investors, (b) investors who meet the criteria of
professional clients and (c) eligible counterparties, each as defined in MiFID
II and the Retained MiFID Provisions; and (ii) eligible for distribution
through all distribution channels as are permitted by MiFID II or the Retained
MiFID Provisions (the "Target Market Assessment"). Notwithstanding the Target
Market Assessment, distributors should note that: the price of the Placing
Shares may decline and investors could lose all or part of their investment;
the Placing Shares offer no guaranteed income and no capital protection; and
an investment in the Placing Shares is compatible only with investors who do
not need a guaranteed income or capital protection, who (either alone or in
conjunction with an appropriate financial or other adviser) are capable of
evaluating the merits and risks of such an investment and who have sufficient
resources to be able to bear any losses that may result therefrom. The Target
Market Assessment is without prejudice to the requirements of any contractual,
legal or regulatory selling restrictions in relation to the Placing.
Furthermore, it is noted that, notwithstanding the Target Market Assessment,
the Joint Bookrunners 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 the Retained MiFID Provisions; or (b) a recommendation to any investor
or group of investors to invest in, or purchase, or take any other action
whatsoever with respect to the Placing Shares.
Each distributor is responsible for undertaking its own target market
assessment in respect of the Placing Shares and determining appropriate
distribution channels.
The Terms and Conditions should be read in their entirety.
Key Terms and Dates
In addition to the definitions set out at the end of these Terms and
Conditions, the following defined terms and dates are relevant to these Terms
and Conditions:
"Admission" means First Admission and/or Second Admission, as the context requires
becoming effective as provided in Rule 6 of the AIM Rules for Companies;
"First Admission" means admission of the Firm Placing Shares to trading on AIM becoming
effective in accordance with the AIM Rules;
"First Admission Date" means 8.00 a.m. on 7 May 2024 or such later time as the Joint Bookrunners may
agree with the Company but in any event no later than 8.00 a.m. on 11 June
2024;
"First Settlement Date" means the date the settlement of transactions in the Firm Placing Shares
following First Admission will take place within the CREST system (subject to
certain exceptions) which is expected to occur on 7 May 2024;
"Issue Price" means 1 pence per Ordinary Share;
"Second Admission" means admission of the Conditional Placing Shares to trading on AIM becoming
effective in accordance with the AIM Rules;
"Second Admission Date" means 8.00 a.m. on 24 May 2024 or such later time as the Joint Bookrunners may
agree with the Company but in any event no later than 8.00 a.m. on 11 June
2024;
"Second Settlement Date" means the date the settlement of transactions in the Conditional Placing
Shares following Admission will take place within the CREST system (subject to
certain exceptions) which is expected to occur on 24 May 2024; and
"Settlement Date" means First Settlement Date and/or Second Settlement Date, as the context
requires.
Details of the Placing Agreement and the Placing Shares
The Joint Bookrunners have entered into the Placing Agreement with the Company
under which, on the terms and subject to the conditions set out in the Placing
Agreement, each of the Joint Bookrunners, as agent for and on behalf of the
Company, has agreed to use its reasonable endeavours to procure Placees for
the Placing Shares at the Issue Price. The Placing is not being underwritten
by either of the Joint Bookrunners or any other person.
The exact number of Placing Shares to be allocated and issued to Placees shall
be determined by the Joint Bookrunners and the Company following completion of
the Bookbuild (as defined below).
The issue of the Firm Placing Shares is to be effected by way of a cashbox
placing. The Company will allot and issue the Firm Placing Shares on a
non-pre-emptive basis to the Placees in consideration for Zeus transferring
its holdings of redeemable preference shares and ordinary subscriber shares in
Bumblebee Finance (Jersey) Limited ("JerseyCo") to the Company. Accordingly,
instead of receiving cash as consideration for the issue of the Firm Placing
Shares, at the conclusion of the Firm Placing the Company will own all of the
issued ordinary shares and redeemable preference shares of JerseyCo whose only
asset will be its cash reserves, which will represent an amount approximately
equal to the net proceeds of the Firm Placing.
The Subscription and the Open Offer are independent from the Placing and for
the avoidance of doubt completion of the Placing is not conditional on
completion of the Subscription and/or the Open Offer. The Open Offer will be
launched on conclusion of the Firm Placing and the Placing Shares will not be
part of the Open Offer. The Open Offer Shares are expected to be admitted to
trading on AIM separately after Second Admission.
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.
Accelerated bookbuilding process
Commencing today, the Joint Bookrunners will be conducting an accelerated
bookbuilding process to determine demand for participation in the Placing by
Placees (the "Bookbuild"). The Announcement gives details of the terms and
conditions of, and the mechanics of participation in, the Placing. However,
the Joint Bookrunners will be entitled to effect the Placing by such
alternative method to the Bookbuild as they may, after consultation with the
Company, determine. No commissions will be paid by Placees in respect of any
participation in the Placing or subscription for Placing Shares.
A bid in the Bookbuild will be made on these Terms and Conditions which are
attached to the Announcement and will be legally binding on the Placee on
behalf of which it is made.
The book will open with immediate effect. The final number of Placing Shares
to be issued pursuant to the Placing will be agreed by the Joint Bookrunners
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 and the allocation of the Placing Shares (including
without limitation whether and to what extent Placees are allocated Firm
Placing Shares and/or Conditional Placing Shares) shall be at the absolute
discretion of the Joint Bookrunners, in consultation with the Company.
To the fullest extent permissible by law, neither:
(a) the Joint Bookrunners (or either of them);
(b) any of their respective affiliates, agents, advisers,
directors, officers, consultants or employees; nor
(c) to the extent not contained within (a) or (b), any person
connected with either of the Joint Bookrunners as defined in the FSMA ((b) and
(c) being together "affiliates" and individually an "affiliate" of the
relevant Joint Bookrunner),
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 of the Joint Bookrunners nor
any of their respective affiliates shall have any liability (including, to the
extent legally permissible, any fiduciary duties), in respect of their conduct
of the Bookbuild or of such alternative method of effecting the Placing as the
Joint Bookrunners may determine.
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 the
Joint Bookrunner to whom the Placee's commitment is given ("Relevant Joint
Bookrunner") and the relevant Placee (a "Recorded Commitment"), each Placee
will be deemed to have read and understood the Announcement and these Terms
and Conditions in their entirety, to be participating and acquiring Placing
Shares on these Terms and Conditions and to be providing the representations,
warranties, indemnities, acknowledgements and undertakings contained in these
Terms and Conditions.
In particular, each such Placee irrevocably represents, warrants, undertakes,
agrees and acknowledges (amongst other things) severally to the Company and
each of the Joint Bookrunners that:
1. it is a Relevant Person and that it will acquire, hold, manage or dispose of any Placing Shares that are allocated to it for the purposes of its business;
2. in the case of a Relevant Person in the United Kingdom who acquires any Placing Shares pursuant to the Placing:
(d) it is a Qualified Investor within the meaning of Article 2(e) of the UK
Prospectus Regulation; and
(e) in the case of any Placing Shares acquired by it as a financial
intermediary, as that term is used in Article 5(1) of the UK Prospectus
Regulation:
(i) the Placing Shares acquired by it in the Placing have not been acquired on behalf of, nor have they been acquired with a view to their offer or resale to, persons in the United Kingdom other than Qualified Investors or in circumstances in which the prior consent of the Joint Bookrunners has been given to the offer or resale; or
(ii) where Placing Shares have been acquired by it on behalf of persons in the United Kingdom other than Qualified Investors, the offer of those Placing Shares to it is not treated under the UK Prospectus Regulation as having been made to such persons; and
3. in the case of a Relevant Person in a member state of the EEA (each, a "Relevant State") who acquires any Placing Shares pursuant to the Placing:
(a) it is a Qualified Investor within the meaning of Article 2(e) of the
EU Prospectus Regulation;
(b) in the case of any Placing Shares acquired by it as a financial
intermediary, as that term is used in Article 5(1) of the
EU Prospectus Regulation:
(i) the Placing Shares acquired by it in the Placing have not been acquired on behalf of, nor have they been acquired with a view to their offer or resale to, persons in a Relevant State other than Qualified Investors or in circumstances in which the prior consent of the Joint Bookrunners has been given to the offer or resale; or
(ii) where Placing Shares have been acquired by it on behalf of persons in a Relevant State other than Qualified Investors, the offer of those Placing Shares to it is not treated under the EU Prospectus Regulation as having been made to such persons;
4. 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 these Terms and Conditions;
5. it understands (or if acting for the account of another person, such person has confirmed that such person understands) and agrees to comply with the resale and transfer restrictions set out in these Terms and Conditions; and
6. except as otherwise permitted by the Company and subject to any available exemptions from applicable securities laws, it (and any account referred to in paragraph 4 above) is outside the United States acquiring the Placing Shares in offshore transactions as defined in and in accordance with Regulation S under the Securities Act.
No prospectus
The Placing Shares are being offered to a limited number of specifically
invited persons only and will not be offered in such a way as to require any
prospectus or other offering document to be published. No prospectus or
other offering document has been or will be submitted to be approved by the
FCA in relation to the Placing or the Placing Shares and Placees' commitments
will be made solely on the basis of the information contained in the
Announcement and any information publicly announced through a Regulatory
Information Service (as defined in the AIM Rules for Companies (the "AIM
Rules")) by or on behalf of the Company on or prior to the date of these Terms
and Conditions (the "Publicly Available Information") and subject to any
further terms set forth in writing in any contract note or trade confirmation
sent to an individual Placee.
Each Placee, by participating in the Placing, agrees that the content of the
Announcement is exclusively the responsibility of the Company and confirms
that it has neither received nor relied on any information (other than the
Publicly Available Information), representation, warranty or statement made by
or on behalf of the Joint Bookrunners or the Company or any other person and
none of the Joint Bookrunners, the Company nor any other person acting on such
person's behalf nor any of their respective affiliates has or shall have any
liability for any Placee's decision to participate in the Placing based on any
other information, representation, warranty or statement. Each Placee
acknowledges and agrees that it has relied on its own investigation of the
business, financial or other position of the Company in accepting a
participation in the Placing. No Placee should consider any information in the
Announcement or these Terms and Conditions to be legal, tax, business or other
advice. Nothing in this paragraph shall exclude the liability of any person
for fraudulent misrepresentation.
Application for admission to trading
Application(s) will be made to the London Stock Exchange for admission of the
Placing Shares to trading on AIM.
It is expected that First Admission will take place on the First Admission
Date and that dealings in the Firm Placing Shares on AIM will commence at the
same time.
It is expected that Second Admission will take place on the Second Admission
Date and that dealings in the Conditional Placing Shares on AIM will commence
at the same time.
Principal terms of the Placing
Zeus is acting as nominated adviser and joint broker to the Placing, as agent
for and on behalf of the Company. Zeus is also acting as subscriber of
shares in JerseyCo for the purposes of the Firm Placing which is structured as
a cashbox placing.
Cavendish is acting as joint broker to the Placing, 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 either of the Joint Bookrunners to participate. The Joint Bookrunners and any of their respective 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 the Relevant Joint Bookrunner (as agent for the Company), to subscribe and pay for, at the Issue 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 the Joint Bookrunners in their discretion following consultation with the Company and will be confirmed by the Relevant Joint Bookrunner either orally or in writing via a contract note or trade confirmation after the Recorded Commitment has taken place.
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 the Relevant Joint Bookrunner's prior written consent, will not be capable of variation or revocation after such time. A contract note or trade confirmation 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 or trade confirmation.
Each Placee will have an immediate, separate, irrevocable and binding obligation, owed to the Relevant Joint Bookrunner (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 Issue Price and the number of Placing Shares allocated to such Placee (subject always to such Placee's agreed maximum).
The Joint Bookrunners 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 and the allocation of the Placing Shares between First Admission and Second Admission shall be at their absolute discretion, in consultation with the Company. The Joint Bookrunners 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 the Joint Bookrunners.
Except as required by law or regulation, no press release or other announcement will be made by the Joint Bookrunners (or either of them) 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.
Registration and settlement
By participating in the Placing, each Placee will be deemed to agree that it
will do all things necessary to ensure that delivery and payment is completed
as directed by the Relevant Joint Bookrunner in accordance with either the
standing CREST or certificated settlement instructions which they have in
place with the Relevant Joint Bookrunner.
Settlement of transactions in the Firm Placing Shares following First
Admission will take place within the CREST system, subject to certain
exceptions. Settlement through CREST will be on a delivery versus payment
basis ("DVP") unless otherwise notified by the Relevant Joint Bookrunner and
is expected to occur on the First Settlement Date.
Settlement of transactions in the Conditional Placing Shares following Second
Admission will take place within the CREST system, subject to certain
exceptions. Settlement through CREST will be on a DVP basis unless otherwise
notified by the Relevant Joint Bookrunner and is expected to occur on the
Second Settlement Date.
In the event of any difficulties or delays in the admission of any Placing
Shares to CREST or the use of CREST in relation to the Placing, the Company
and the Joint Bookrunners may agree that the Placing Shares (or any of them)
should be issued in certificated form. Each of the Joint Bookrunners
reserves the right to require settlement for any of the Placing Shares, and to
deliver any of the Placing Shares to any Placees, by such other means as it
deems necessary if delivery or settlement to any Placee is not practicable
within the CREST system or would not be consistent with regulatory
requirements in the jurisdiction in which a Placee is located.
Interest is chargeable daily on payments not received from Placees on or
before the due date in accordance with the arrangements set out above, in
respect of either CREST or certificated deliveries, at the rate of 3
percentage points above the prevailing base rate of Barclays Bank plc as
determined by the Relevant Joint Bookrunner.
Each Placee is deemed to agree that if it does not comply with these
obligations, the Relevant Joint Bookrunner may sell any or all of their
Placing Shares on their behalf and retain from the proceeds, for the Relevant
Joint Bookrunner's own account and benefit, an amount equal to the aggregate
amount owed by the Placee plus any interest due. The relevant Placee will,
however, remain liable for any shortfall below the Issue Price and for any
stamp duty or stamp duty reserve tax (together with any interest or penalties)
which may arise upon the sale of its Placing Shares on its behalf.
If Placing Shares are to be delivered to a custodian or settlement agent,
Placees must ensure that, upon receipt, any relevant contract note or 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
United Kingdom stamp duty or stamp duty reserve tax.
Conditions of the Placing
The Placing is conditional upon the Placing Agreement becoming unconditional
and not having been terminated in accordance with its terms. Furthermore, the
Conditional Placing is conditional upon the Resolutions being passed at the
General Meeting without amendment.
The obligations of the Joint Bookrunners under the Placing Agreement in
respect of the Firm Placing Shares and the Subscription Shares are, and the
Firm Placing is, conditional upon, inter alia:
(a) the warranties and undertakings contained in the
Placing Agreement ("Warranties") being true, accurate and not misleading when
made on the date of the Placing Agreement and at all times up to First
Admission by reference to the facts and circumstances subsisting at that time;
(b) the Company having fully performed its obligations under
the Placing Agreement, the Option Agreement and the Transfer Agreement to the
extent that they fall to be performed prior to First Admission;
(c) neither of the Joint Bookrunners having exercised
their right to terminate the Placing Agreement; and
(d) First Admission having occurred on or before 8:00 a.m.
on the First Admission Date.
The obligations of the Joint Bookrunners under the Placing Agreement in
respect of the Conditional Placing Shares are, and the Conditional Placing is,
conditional upon, inter alia:
(a) First Admission having occurred not later than 8.00
a.m. on the First Admission Date;
(b) the Circular and a form of proxy having been sent to
Shareholders by no later than 3 May 2024 in accordance with the Company's
articles of association;
(c) the Resolutions being passed at the General Meeting
without amendment;
(d) the Warranties being true, accurate and not misleading
when made on the date of the Placing Agreement and at all times up to Second
Admission by reference to the facts and circumstances subsisting at that time;
(e) the Company having fully performed its obligations
under the Placing Agreement to the extent that they fall to be performed prior
to Second Admission;
(f) neither of the Joint Bookrunners having exercised
their right to terminate the Placing Agreement with regard to the Conditional
Placing; and
(g) Second Admission having occurred on or before 8:00
a.m. on the Second Admission Date;
(all conditions to the obligations of the Joint Bookrunners included in the
Placing Agreement in respect of the Firm Placing Shares, the Subscription
Shares and/or the Conditional Placing Shares being together, the
"conditions").
If any of the conditions is not fulfilled or, where permitted, waived in
accordance with the Placing Agreement within the stated time periods (or such
later time and/or date as the Company and the Joint Bookrunners may agree), or
the Placing Agreement is terminated in accordance with its terms, the Placing
(or such part of it as may then remain to be completed) will lapse and the
Placee's rights and obligations shall cease and terminate at such time and
each Placee agrees that no claim can be made by or on behalf of the Placee (or
any person on whose behalf the Placee is acting) in respect thereof.
By participating in the Placing, each Placee agrees that its rights and
obligations cease and terminate only in the circumstances described above and
under "Termination of the Placing" below and will not be capable of rescission
or termination by it.
The Joint Bookrunners may, in their absolute discretion (but acting together)
and upon such terms as they think fit, waive fulfilment of all or any of the
conditions in the Placing Agreement in whole or in part, or extend the time
provided for fulfilment of one or more conditions, save that certain
conditions (including the condition relating to Admission referred to in
paragraph (e) above) may not be waived. Any such extension or waiver will
not affect Placees' commitments as set out in these Terms and Conditions.
Either of the Joint Bookrunners may terminate the Placing Agreement in certain
circumstances, details of which are set out below.
Neither the Joint Bookrunners nor any of their respective affiliates, agents,
advisers, directors, officers or employees nor the Company shall have any
liability to any Placee (or to any other person whether acting on behalf of a
Placee or otherwise) in respect of any decision any of them 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 (or any part thereof) nor for any decision any
of them may make as to the satisfaction of any condition or in respect of the
Placing generally (or any part thereof) and by participating in the Placing
each Placee agrees that any such decision is within the absolute discretion of
the Joint Bookrunners.
Termination of the Placing
Save as set out below, either of the Joint Bookrunners may, in its absolute
discretion, by notice to the Company, terminate the Placing Agreement at any
time up to Second Admission if, inter alia, it is of the opinion, in its
absolute discretion, that any of the following has occurred and it is, as a
result of such matter, inappropriate to proceed with the Placing (or any part
of it):
(a) any statement contained in the Circular 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 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 untrue, inaccurate or
misleading when made and/or that any of the Warranties has ceased to be true
or accurate or has become 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 complied or cannot comply with any
of its obligations under the Placing Agreement, the Option Agreement or the
Transfer Agreement or otherwise relating to the Placing and Admission (to the
extent that such obligations fall to be complied with prior to Admission);
(d) there has occurred any material adverse change in the
financial position or prospects of the Company (or its group on a consolidated
basis); or
(e) there has occurred any change in national or
international financial, monetary, market (including fluctuations in exchange
rates), industrial, economic, legal or political conditions or there has
occurred or been a material worsening of any international or national crisis,
civil unrest, act of terrorism or outbreak of hostilities which is material in
the context of the Placing.
Once First Admission has occurred, neither of the Joint Bookrunners will have
the right to terminate any of its obligations under the Placing Agreement with
regard to the Firm Placing, but may at any time up to Second Admission
terminate its obligations under the Placing Agreement as regards the
Conditional Placing.
If the Placing Agreement is terminated in accordance with its terms, the
rights and obligations of each Placee in respect of the Firm Placing as
described in these Terms and Conditions shall cease and terminate at such time
and no claim can be made by any Placee in respect thereof.
If the Placing Agreement is terminated in accordance with its terms at any
time after First Admission but prior to Second Admission, the rights and
obligations of each Placee in respect of the Conditional Placing as described
in these Terms and Conditions shall cease and terminate at such time and no
claim can be made by any Placee in respect thereof, but for the avoidance of
doubt the rights and obligations of any Placee in respect of the Firm Placing
shall not be capable of termination at any time after First Admission.
By participating in the Placing, each Placee agrees with the Company and the
Joint Bookrunners that the exercise by the Company or the Joint Bookrunners 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
the Joint Bookrunners (or either of them) or for agreement between the Company
and the Joint Bookrunners (as the case may be) and that neither the Company
nor the Joint Bookrunners need make any reference to such Placee and that none
of the Company, the Joint Bookrunners 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 a Joint Bookrunner (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 and confirm and warrant and
undertake to, and agree with, each of the Company and the Joint Bookrunners,
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.
Representations, warranties and further terms
By participating in the Placing, each Placee (and any person acting on such
Placee's behalf) represents, warrants, acknowledges, undertakes, confirms and
agrees (for itself and for any such prospective Placee) that (save where the
Relevant Joint Bookrunner 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 the Publicly Available Information;
2. it has not received a prospectus or other offering
document in connection with the Placing and acknowledges that no prospectus or
other offering document:
(a) is required under any applicable law; or
(b) has been or will be prepared in connection with the
Placing
and, in particular, that the Subscription and Open Offer referred to in the Announcement and the Circular relating thereto are separate from the Placing and do not form part of any offer or agreement concerning the Placing and/or any Placing Shares;
3. the Ordinary Shares are admitted to trading on AIM,
and that the Company is therefore required to publish certain business and
financial information in accordance with the AIM Rules and the Market Abuse
Regulation (EU Regulation No. 596/2014 which forms part of domestic law
pursuant to the European Union (Withdrawal) Act 2018) ("UK MAR")), which
includes a description of the nature of the Company's business and the
Company's most recent published balance sheet and statement of total
comprehensive income and that it is able to obtain or access such information
without undue difficulty, and is able to obtain access to such information or
comparable information concerning any other publicly traded company, without
undue difficulty;
4. 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 the Joint Bookrunners 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 and these Terms and Conditions
or the Publicly Available Information; nor has it requested either of the
Joint Bookrunners, the Company, 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;
5. neither of the Joint Bookrunners nor any person
acting on behalf of them nor any of their 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;
6. the only information on which it is entitled to rely
on and on which it has relied on 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;
7. neither the Joint Bookrunners nor any of their
respective 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, the Circular or the Publicly Available
Information;
8. it has conducted its own investigation of the
Company, the Placing and the Placing Shares, satisfied itself that the
information is still current and relied on that investigation for the purposes
of its decision to participate in the Placing;
9. it has not relied on any investigation that either of
the Joint Bookrunners or any person acting on their behalf may have conducted
with respect to the Company, the Placing or the Placing Shares;
10. the contents of the Announcement, the Circular and the
other Publicly Available Information as well as any information made available
(in written or oral form) in presentations or as part of roadshow discussions
with investors relating to the Company (the "Information") has been prepared
by and is exclusively the responsibility of the Company and neither the Joint
Bookrunners nor any persons acting on their behalf is responsible for or has
or shall have any liability for any such Information, or for any
representation, warranty or statement relating to the Company contained
therein nor will they be liable for any Placee's decision to participate in
the Placing based on any Information or any representation, warranty or
statement contained therein or otherwise;
11. 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 the Relevant Joint Bookrunner determines;
12. it and/or 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 of and acknowledges it is required to comply with all applicable laws
and regulations with respect to its acquisition of Placing Shares;
13. it is not, and any person who it is acting on behalf of
is not, and at the time the Placing Shares are acquired will not be, a
resident of, or with an address in, or subject to the laws of, Australia, New
Zealand, the Republic of Ireland, Canada, the Republic of South Africa or
Japan, and it acknowledges and agrees that the Placing Shares have not been
and will not be registered or otherwise qualified under the securities
legislation of Australia, New Zealand, the Republic of Ireland, Canada, the
Republic of South Africa or Japan and may not be offered, sold, or acquired,
directly or indirectly, within those jurisdictions;
14. 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;
15. 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;
16. 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;
17. it will not distribute, forward, transfer or otherwise
transmit the Announcement or these Terms and Conditions and/or the Circular or
any part of them, or any other presentational or other materials concerning
the Placing 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;
18. none of the Joint Bookrunners, their respective
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 either of the Joint Bookrunners and that the Joint Bookrunners have
no duties or responsibilities to it for providing the protections afforded to
its clients or for providing advice in relation to the Placing nor in respect
of any representations, warranties, undertakings or indemnities contained in
the Placing Agreement nor for the exercise or performance of any of its rights
and obligations thereunder including any rights to waive or vary any
conditions or exercise any termination right;
19. it will make payment to the Relevant Joint Bookrunner
for the Placing Shares allocated to it in accordance with these Terms and
Conditions on or by the Settlement Date, failing which the relevant Placing
Shares may be placed with others on such terms as the Relevant Joint
Bookrunner determines in its absolute discretion without liability to the
Placee and it will remain liable for any shortfall below the net proceeds of
such sale and the placing proceeds of such Placing Shares 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) which may arise upon the sale of such Placee's Placing Shares
on its behalf;
20. 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 the Relevant Joint
Bookrunner 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;
21. no action has been or will be taken by any of the
Company, the Joint Bookrunners or any person acting on behalf of the Company
or either of the Joint Bookrunners 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;
22. the person who it specifies for registration as holder
of the Placing Shares will be:
(a) the Placee; or
(b) a nominee of the Placee, as the case may be;
23. neither the Joint Bookrunners 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 the Joint
Bookrunners in respect of the same on the basis that the Placing Shares will
be allotted to a CREST stock account of (or nominated by) the Relevant Joint
Bookrunner or transferred to a CREST stock account of the Relevant Joint
Bookrunner who will hold them as nominee on behalf of the Placee until
settlement in accordance with its standing settlement instructions with it;
24. 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;
25. 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;
26. 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 other member state of the
EEA within the meaning of the UK Prospectus Regulation, or an offer to the
public in any Relevant State within the meaning of the EU Prospectus
Regulation;
27. 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, these Terms and Conditions nor the Circular has been or will be
approved by the Joint Bookrunners in their 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;
28. 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 UK MAR in respect of anything done in, from or otherwise involving
the United Kingdom);
29. the Placing Shares acquired by it in the Placing will
not be acquired on a non-discretionary basis on behalf of, nor will they be
acquired with a view to their offer or resale to any person save in
circumstances in which the express prior written consent of the Relevant Joint
Bookrunner has been given to the offer or resale;
30. 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;
31. neither the Joint Bookrunners, the Company nor any of
their respective affiliates, agents, advisers, directors, officers or
employees nor any person acting on behalf of the Joint Bookrunners 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 any of the Joint Bookrunners' rights and
obligations thereunder including any rights to waive or vary any conditions or
exercise any termination right;
32. either of the Joint Bookrunners and their respective
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, the Joint Bookrunners and/or any of their respective affiliates
acting as an investor for its or their own account(s). Neither the Joint
Bookrunners 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;
33. 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
(iii) 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 33
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 the Relevant Joint Bookrunner such evidence, if any, as to the
identity or location or legal status of any person which it 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 the Relevant Joint Bookrunner 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 the Relevant Joint Bookrunner may decide at its
sole discretion;
34. in order to ensure compliance with the Regulations, the
Relevant Joint Bookrunner (for itself and as agent on behalf of the Company)
or the Company's registrars may, in their absolute discretion, require
verification of its identity. Pending the provision to the Relevant Joint
Bookrunner or the Company's registrars, as applicable, of evidence of
identity, definitive certificates in respect of the Placing Shares may be
retained at the Relevant Joint Bookrunner's absolute discretion or, where
appropriate, delivery of the Placing Shares to it in uncertificated form may
be delayed at the Relevant Joint Bookrunner's or the Company's registrars', as
the case may be, absolute discretion. If within a reasonable time after a
request for verification of identity the Relevant Joint Bookrunner (for itself
and as agent on behalf of the Company) or the Company's registrars have not
received evidence satisfactory to them, either the Relevant Joint Bookrunner
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;
35. 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 any Joint Bookrunner's conduct of the Placing;
36. neither of the Joint Bookrunners nor any of their
respective 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;
37. 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;
38. it irrevocably appoints any duly authorised officer of
the Relevant Joint Bookrunner as its agent for the purpose of executing and
delivering to the Company and/or its registrars 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;
39. the Company, the Joint Bookrunners 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, acknowledgements and agreements, which are given
to each of the Joint Bookrunners on their own behalf and on behalf of the
Company and are irrevocable;
40. 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;
41. time is of the essence as regards its obligations under
these Terms and Conditions;
42. 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 the Relevant Joint Bookrunner;
43. the Placing Shares will be issued subject to these Terms
and Conditions; and
44. 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 the Relevant Joint
Bookrunner 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, the Joint
Bookrunners 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 either of the Joint Bookrunners, 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 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 the Joint Bookrunners 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 the
Relevant Joint Bookrunner 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 the Joint
Bookrunners in the event that any of the Company and/or the Joint Bookrunners
have incurred any such liability to such taxes or duties.
The representations, warranties, acknowledgements and undertakings contained
in these Terms and Conditions are given to each of the Joint Bookrunners for
itself and on behalf of the Company and are irrevocable.
The Joint Bookrunners are authorised and regulated by the FCA in the United
Kingdom and are 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
the Joint Bookrunners do 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 either of the Joint
Bookrunners provided always that such variation, waiver or modification is not
materially prejudicial to the interests of the Company or the other Joint
Bookrunner.
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.
Each Placee and any person acting on behalf of the Placee acknowledges and
agrees that either of the Joint Bookrunners 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 a
Joint Bookrunner, any money held in an account with the Relevant Joint
Bookrunners 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 the
Relevant Joint Bookrunner'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, these Terms and Conditions or the Circular
is intended to be a profit forecast or estimate, and no statement in the
Announcement, these Terms and Conditions or the Circular should be interpreted
to mean that earnings per share of the Company for the current or future
financial years will necessarily match or exceed the historical published
earnings per share of the Company.
The price of the Ordinary 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 Ordinary 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 AIM.
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
In this Announcement the following terms have the associated meanings:
"Act" the Companies Act 2006 (as amended)
"AIM" the AIM market operated by the London Stock Exchange
"AIM Rules for Companies" means the rules of AIM as set out in the publication entitled "AIM Rules for
Companies" published by the London Stock Exchange from time to time
"Announcement" this announcement
"Application Form" the personalised application form that will be posted with the Circular for
use by Qualifying Shareholders in connection with the Open Offer
"Bookbuild" an accelerated process conducted by the Joint Bookrunners to determine demand
for participation in the Placing by Placees
"Cavendish" means, Cavendish Capital Markets Limited a company incorporated in England and
Wales with company number 06198898, authorised and regulated by the FCA, and
for the purpose of trade settlement in the Placing means, Cavendish Securities
plc a company incorporated in England and Wales with company number 05210733,
authorised and regulated by the FCA
"Circular" means the explanatory circular to be issued by the Company to Shareholders
explaining, inter alia, the Fundraising and incorporating the notice of the
General Meeting
"Company" Surface Transforms Plc, registered in England and Wales under number 03769702
whose registered office is at Image Business Park, Acornfield Road, Knowsley
Industrial Park, Liverpool, England, L33 7UF
"Conditional Placing" means the proposed placing of the Conditional Placing Shares by the Joint
Bookrunners on behalf of the Company at the Issue Price
"Conditional Placing Shares" means Placing Shares (in such number as is agreed between the Company and the
Joint Brokers in accordance with the Placing Agreement) to be issued by the
Company to the Placees pursuant to the Placing and admitted to trading on AIM
on the Second Admission Date
"CREST" the computerised settlement system to facilitate transfer of the title to an
interest in securities in uncertificated form operated by Euroclear
"Directors" or "Board" the directors of the Company at the date of this Announcement
"Euroclear" Euroclear UK & International Limited
"EV" means electric vehicles
"Existing Ordinary Shares" the 352,072,638 Ordinary Shares in issue at the date of this Announcement;
"FCA" Financial Conduct Authority of the UK;
"Firm Placing" means the proposed placing of the Firm Placing Shares by the Joint Bookrunners
on behalf of the Company at the Issue Price
"Firm Placing Shares" means 58,727,744 Placing Shares, to be issued by the Company to the Placees
pursuant to the Placing and admitted to trading on AIM on the First Admission
Date
"Fundraising" means the Placing, the Subscription and the Open Offer
"General Meeting" means the general meeting of the Company to be held at the offices of Gateley
Plc, Ship Canal House, 98 King Street, Manchester, M2 4WU on 23 May 2024 at
11.00 a.m., convened pursuant to the Notice of General Meeting
"Issue Price" 1 pence per New Ordinary Share
"JerseyCo" Bumblebee Finance (Jersey) Limited, a new Jersey-incorporated subsidiary of
the Company which has its registered office at 47 Esplanade, St Helier, Jesey
JE1 0BD and registered company number is 154104
"Joint Bookrunners" Zeus and Cavendish (each a "Joint Bookrunner")
"London Stock Exchange" London Stock Exchange plc
"New Ordinary Shares" together the Placing Shares, Subscription Shares and the Open Offer Shares
"Notice of General Meeting" the notice of the General Meeting contained within the Circular
"OEM" original equipment manufacturer
"Open Offer" means the conditional invitation proposed to be made by the Company to
Qualifying Shareholders to subscribe for the Open Offer Shares
"Open Offer Shares" means up to 200,000,000 new Ordinary Shares which are to be the subject of the
Open Offer
"Option Agreement" the initial subscription and put and call option agreement entered into on or
around the date of this announcement by the Company, JerseyCo and Zeus
providing for the subscription by Zeus for shares in JerseyCo and granting
Zeus the option to sell and granting the Company the option to buy such
JerseyCo shares held by Zeus
"Ordinary Shares" ordinary shares of £0.01 each in the capital of the Company
"Placees" means the persons with whom Placing Shares are placed pursuant to the Placing
"Placing" means the proposed placing of the Placing Shares by the Joint Bookrunners on
behalf of the Company at the Issue Price, in accordance with the Placing
Agreement
"Placing Agreement" the conditional placing agreement relating to the Placing of the Placing
Shares between the Company and the Joint Bookrunners
"Placing Shares" means the new Ordinary Shares proposed to be issued by the Company and offered
for subscription to Placees at the Issue Price as part of the Placing
(including the Firm Placing Shares and the Conditional Placing Shares, but
excluding the Subscription Shares and the Open Offer Shares)
"Qualifying Shareholders" Shareholders whose Ordinary Shares are on the register of members of the
Company at the close of business on the Record Date with the exclusion
(subject to exemptions) of persons with a registered address or located or
resident outside the United Kingdom
"Record Date" close of business on 1 May 2024
"Regulation S" Regulation S under the Securities Act 1933, as amended
"Resolutions" the resolutions contained in the Notice of General Meeting
"Shareholders" holders of Ordinary Shares
"SOP" start of production
"Subscription" the private subscription at the Issue Price by (i) David Bundred, (ii) Ian
Cleminson, (iii) Kevin Johnson, (iv) Isabelle Maddock, (v) Matthew Taylor,
(vi) Julia Woodhouse and (vii) Stephen Easton (or their respective associates)
directly with the Company for the Subscription Shares pursuant to the
Subscription Letters
"Subscription Letters" the letters to be entered into between the Company and each of (i) David
Bundred, (ii) Ian Cleminson, (iii) Kevin Johnson, (iv) Isabelle Maddock, (v)
Matthew Taylor, (vi) Julia Woodhouse and (vii) Stephen Easton (or their
respective associates)
"Subscription Shares" the 21,850,000 new Ordinary Shares which are to be issued by the Company
pursuant to the Subscription
"Transfer Agreement" the subscription and transfer agreement entered into on or around the date of
this announcement by the Company, JerseyCo and the Joint Brokers providing,
inter alia, for the subscription by the Joint Brokers for certain shares in
JerseyCo and the acquisition by the Company from the Joint Brokers of such
shares
"United States or US" the United States of America, its territories and possessions, any state of
the United States and the District of Columbia
"Zeus" or "Nominated Adviser" means Zeus Capital Limited, a company incorporated in England and Wales with
company number 04417845, authorised and regulated by the FCA
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