REG - Zytronic PLC - Publication of Circular

ZytronicAnnouncement

11/04/2025 11:00

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RNS Number : 7185E  Zytronic PLC  11 April 2025

THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION FOR THE PURPOSES OF ARTICLE 7 OF
THE MARKET ABUSE REGULATION (EU) 596/2014 AS IT FORMS PART OF UK DOMESTIC LAW
BY VIRTUE OF THE EUROPEAN UNION (WITHDRAWAL) ACT 2018 ("MAR"), AND IS
DISCLOSED IN ACCORDANCE WITH THE COMPANY'S OBLIGATIONS UNDER ARTICLE 17 OF MAR

 

11 April 2025

 

Zytronic plc

 

("Zytronic" or the "Company" and its subsidiaries)

 

Proposed cancellation of admission of Ordinary Shares to trading on AIM

and

Notice of General Meeting

 

Further to the announcement made by the Company on 7 April 2025, The Company
announces the proposed cancellation of its ordinary shares of £0.01 each in
the Company ("Ordinary Shares") to trading of the Ordinary Shares on AIM
("Cancellation").

 

The Board believes that the Cancellation is in the best interests of the
Company and its shareholders as a whole. Further details of the background to
and reasons for the Proposals and other matters are set out in Appendix I to
this announcement (the "Announcement"), which contains extracts from the
circular to shareholders (the "Circular" or the "Document"). References to
'this Document' refer to the Circular.

 

Mr and Mrs Gavin Smith, as holders of 4.37 per cent. of the Company's issued
share capital, are entitled to vote on the Resolution and the Company has
received an irrevocable undertaking signed on behalf of Mr and Mrs Gavin Smith
to vote those shares in favour of the Resolution. In addition, Henry Spain
Investment Services Limited and Mr John Walter respectively hold 18.93 per
cent. and 5.04 per cent. of the Company's issued share capital and are
entitled to vote on the Resolution and the Company has received letters of
intent signed on behalf of Henry Spain Investment Services Limited and Mr John
Walter to vote these shares in favour of the Resolution. In addition, those
Directors who own Ordinary Shares, representing in aggregate 0.87 per cent of
the Company's issued share capital, have signed irrevocable undertakings to
vote those shares in favour of the Resolution.

 

In total, therefore, the Company has received support to vote in favour of the
Resolution at the General Meeting with respect to 2,968,377 Ordinary Shares
(representing in aggregate 29.21 per cent of the Company's issued share
capital).

 

Transactions in Ordinary Shares prior to and following Cancellation

 

Prior to Cancellation

 

The Company's Shares were suspended with effect from 7.30 a.m. on 1 April 2025
pending publication of the Company's full year Annual Report and Accounts for
the year ended 30 September 2024 ("FY24 AR&A"). Shareholders have
therefore been unable to continue trading in the Ordinary Shares on AIM
following such date.

 

As announced by the Company on 28 March 2025, the Board does not anticipate
that publication of the FY24 AR&A will occur prior to the proposed
Cancellation date. Therefore, if the resolution necessary to effect the
Cancellation is passed, the final date of trading on AIM in the Ordinary
Shares will have been 31 March 2025.

 

Should Cancellation not Occur

 

Should the Resolution not be passed and Cancellation be unsuccessful,
admission of the Company's Ordinary Shares to trading on AIM will be
maintained, noting that trading on AIM in the Ordinary Shares was suspended
with effect from 7.30a.m. on 1 April 2025, pending publication of the
Company's FY24 AR&A. The Board does not have an estimate of when the FY24
AR&A will be published.

 

The Circular will be published on the Company's website
https://www.zytronic.co.uk/plc/ (https://www.zytronic.co.uk/plc/) and will be
sent to shareholders today, setting out the background to and reasons for the
Proposal. Extracts from the Circular are included in Appendix I of this
Announcement and shareholders are recommended to read this Document as a
whole. The Company is seeking shareholder approval for the Cancellation, at a
meeting to be convened at 3:00 p.m. on 7 May 2025 to be held at Ward Hadaway
LLP, Sandgate House, 102 Quayside, Newcastle Upon Tyne NE1 3DX (the "General
Meeting").

 

The Cancellation resolution is conditional, pursuant to Rule 41 of the AIM
Rules for Companies, upon the approval of shareholders holding not less than
75 per cent. of the votes cast by shareholders (whether present in person or
by proxy) at the General Meeting, notice of which is set out in the Circular.

 

If the Cancellation resolution is passed at the General Meeting, it is
anticipated that Cancellation will become effective at 8:00 a.m. on 15 May
2025.

 

To facilitate future shareholder transactions in the Ordinary Shares,
conditional upon the Cancellation resolution being passed, Asset Match Limited
has been appointed to provide a Secondary Market Trading facility, which is
expected to be available from 15 May 2025, with the first auction closing on
17 June 2025 followed by monthly auctions thereafter. Asset Match, a firm
Authorised and Regulated by the Financial Conduct Authority (FRN 579310), will
operate an electronic off-market dealing facility in the Ordinary Shares. This
facility will allow existing shareholders of the Company and new investors to
trade the Ordinary Shares by matching buyers and sellers through periodic
auctions.

 

A copy of the Circular will be made available later today on the Company's
website at https://www.zytronic.co.uk/plc/ (https://www.zytronic.co.uk/plc/) .

 

Expected Timetable of Principal Events

 

 Last day for trading of Ordinary Shares on AIM                                                                      31 March 2025

 Announcement of proposed Cancellation pursuant to AIM Rule 41                                                       11 April 2025

 Notice provided to the London Stock Exchange to notify it of the proposed                                           11 April 2025
 Cancellation

 Publication and posting of this document (including Notice of General Meeting)                                      11 April 2025
 to Shareholders

 Latest time and date for receipt of appointments in respect of the General                                          3.00 p.m. on 2 May 2025
 Meeting

 General Meeting                                                                                                     3.00 p.m. on 7 May 2025

 Anticipated date to announce results of the General Meeting                                                         7 May 2025

 Expected date of Cancellation³                                                                                      8.00a.m. on 15 May 2025

 Secondary Market Trading Facility for Ordinary Shares commences                                                     15 May 2025

Notes

(1)   All of the times referred to in this Circular refer to London time,
unless otherwise stated.

(2)   Each of the times and dates in the above timetable is subject to
change. If any of the above times and/or dates change, the revised times and
dates will be notified to Shareholders by an announcement through a Regulatory
Information Service and/or the Company's website.

(3)   The Cancellation requires the approval of not less than 75% of the
votes cast by Shareholders at the General Meeting.

 

 

The above summary should be read in conjunction with the full text of this
Announcement and the Circular, extracts from which are set out in Appendix I
below. Please refer to Appendix I to this Announcement which sets out further
details of the Proposals, as extracted from the Circular. Unless otherwise
stated, capitalised terms in this Announcement have the meanings ascribed to
them in Appendix II to this Announcement and in the Circular.

 

For further information please contact:

 

Enquiries:

 Zytronic plc                                                                                                                                                                                                        0191 414 5511

 Christopher Potts, Non-Executive Chairman

 Claire Smith, Chief Executive Officer

 Asset Match                                                                                                                                                                                                         020 7248 2788
 Limited

 Hannah Woodley, Commercial Director

 Ben Weaver, Business Development Director

 Singer Capital Markets (Nominated Adviser and Broker)                                                                                                                                                               020 7496 3000

 Alex Bond, Samed Ethemi (Investment Banking)

 

Notes to Editors

The Company's trading entity Zytronic Displays Limited ("ZDL") is an
established developer and manufacturer of a range of internationally
award-winning optically transparent interactive touch sensor overlay products
for use with electronic displays in industrial, self-service and public access
equipment.

 

ZDL has continually developed process and technological know-how and
intellectual property since the late 1990's around two projected capacitance
("PCAP") sensing methodologies; trademarked by it as PCT™ ("Projected
Capacitive Technology") and MPCT™ ("Mutual Projected Capacitive
Technology"), in respect of which 20 internationally granted patents are held.
As part of this the Company has invested in and developed an advanced
electronic PCAP controller, the ZXY500, which incorporates a specialist
Application Specific Integrated Circuit ("ASIC") specified and owned by
Zytronic, and bespoke firmware on the controller processor.

 

ZDL's PCAP sensing solutions are readily configurable and embedded in a
laminate core which offers significant durability, environmental stability,
and optical enhancement benefits to meet system-specific design requirements.

 

The Company is headquartered at Blaydon-upon-Tyne in the United Kingdom. ZDL
operates from this site, providing its manufactured products globally through
a number of sales channel partners. ZDL differentiates itself from others in
the touch eco-system as it offers a complete one-stop solution including
processing internally of the form and factor of glass and film substrates, the
assembly of the associated touch overlay products, in environmentally
controlled cleanrooms to customer's specific requirements and the development
of the bespoke firmware, software and electronic hardware which comprise the
controller that links the manufactured touch interactive overlays to a
customer's integrated systems and product.

 

For more information about ZDL's technologies and products, and the Company
please see www.zytronic.co.uk (https://www.zytronic.co.uk/)

 

APPENDIX I

 

Proposals for:

 

Proposed cancellation of admission of Ordinary Shares to trading on AIM

and

Notice of General Meeting

 

 

1.         INTRODUCTION

As announced by the Company on 26 February 2025, the Directors have concluded
that it is in the best interests of the Company and its Shareholders to cancel
the admission to trading of the Ordinary Shares on AIM.

The Resolution is being put to Shareholders in order to continue the orderly
wind-down of the Company, in line with the strategy communicated to
Shareholders following the conclusion of the strategic review announced on 14
November 2024.

This Circular explains the background to and reasons for the Cancellation and
includes the notice of General Meeting at which the Resolution will be
proposed.

Under the AIM Rules, the Cancellation requires the expiration of a period of
not less than 20 clear Business Days from the date on which notice of the
intended Cancellation is notified via a Regulatory Information Service and is
given to the London Stock Exchange. Pursuant to Rule 41 of the AIM Rules, the
Directors have notified the London Stock Exchange of the date of the proposed
Cancellation. Subject to the passing of the Resolution, Cancellation will
occur no earlier than five clear Business Days after the General Meeting. Due
to the Company missing its six month filing deadline for its annual report
& accounts to 30 September 2024, the last day of trading in Ordinary
Shares was on 31 March 2025 and the Ordinary Shares were suspended from
trading on AIM with effect from 7.30 a.m. on 1 April 2025. If the Resolution
is passed it is expected that Cancellation will take effect at 8.00 a.m. on 15
May 2025.

The Cancellation is conditional, pursuant to Rule 41 of the AIM Rules, upon
the approval of not less than 75 per cent. of the votes cast by Shareholders
(whether present in person or by proxy) at the General Meeting, notice of
which is set out in Part III of this Circular.

The Company is therefore seeking Shareholders' approval of the Cancellation at
the General Meeting which has been convened for 3.00p.m. on 7 May 2025 at Ward
Hadaway LLP, Sandgate House, 102 Quayside, Newcastle Upon Tyne NE1 3DX.

Mr and Mrs Gavin Smith, as holders of 4.37 per cent. of the Company's issued
share capital, are entitled to vote on the Resolution and the Company has
received an irrevocable undertaking signed on behalf of Mr and Mrs Gavin Smith
to vote those shares in favour of the Resolution. In addition, Henry Spain
Investment Services Limited and Mr John Walter hold respectively 18.93 per
cent. and 5.04 per cent. of the Company's issued share capital and are
entitled to vote on the Resolution and the Company has received letters of
intent signed on behalf of Henry Spain Investment Services Limited and Mr John
Walter to vote these shares in favour of the Resolution. In addition, those
Directors who own Ordinary Shares, representing in aggregate 0.87 per cent of
the Company's issued share capital, have signed irrevocable undertakings to
vote those shares in favour of the Resolution.

In total, therefore, the Company has received support to vote in favour of the
Resolution at the General Meeting with respect to 2,968,377 Ordinary Shares
(representing in aggregate 29.21 per cent of the Company's issued share
capital).

The Directors have been keen to ensure that, for those Shareholders who choose
to do so, there is an opportunity to trade out their shareholding following,
and notwithstanding, the Cancellation. The Company has arranged for Asset
Match to provide a Secondary Market Trading Facility to facilitate the buying
and selling of Ordinary Shares by Shareholders and new investors by matching
buyers and sellers through periodic auctions. Further information regarding
the Secondary Market Trading Facility in contained below.

The purpose of this Circular is to provide you with the information on the
background to and reasons for the Cancellation, explain the consequences of
the Cancellation and why the Directors unanimously consider the Cancellation
to be in the best interests of the Company and its shareholders as a whole and
seek Shareholders' approval for the Resolution.

The Notice of the General Meeting is set out in Part III of this Circular.

2.         BACKGROUND TO THE PROPOSED CANCELLATION

On 16 October 2024, the Company announced a strategic review alongside its
pre-close trading update whereby the Board set out its opinion that it was
unlikely that a significant improvement in trading would be forthcoming
without a strategic catalyst ("Strategic Review"). Therefore, the Board would
undertake a strategic review, in conjunction with Shareholders, to assess the
future options for the Company.

On 14 November 2024, Zytronic announced the conclusion of its Strategic
Review. After consulting with Shareholders and considering ongoing weak
trading conditions with no material uplift in order intake, the Board resolved
to pursue a sale and/or wind-down of the Group's assets with the intention of
returning capital to Shareholders via a solvent liquidation.

On 19 February 2025 the Company confirmed that the sale process for its
trading subsidiary, Zytronic Displays Limited, had concluded without reaching
terms deemed by the Board to be suitably attractive for Shareholders, despite
engagement with multiple counterparties. As a result, the Board, in
consultation with FRP Advisory confirmed it would commence the orderly
wind-down of the Group's assets.

On 26 February 2025, following the unsuccessful sale process of its trading
subsidiary Zytronic Displays Limited, the Board, in consultation with FRP
Advisory, commenced an orderly wind-down of the Group's assets and FRP
Advisory prepared an outcome statement of estimated returns available to
Shareholders in this regard. The Board advised that Shareholders can expect to
receive an estimated return of 46 pence per Ordinary Share held in the Company
in a conservative scenario, increasing to 60 pence per Ordinary Share (the
"Outcome Range"), should prevailing asset valuations hold through the
wind-down period. The Outcome Range is a highly conditional estimate and based
upon and subject to, inter alia, the following major assumptions:

•           that the Company's real estate property sells for a
value within +/-10% of the Company's advisor's   valuation;

•           that the wind-down of the Company and its trading
subsidiary proceed in an orderly manner and principally complete within 9
months of 26 February 2025; and

•           that there are no material unforeseen creditors.

The Outcome Range remains valid as at the date of this Circular.

To reduce costs and maximise returns to Shareholders, the Board announced on
the same date its intention to cancel admission to trading in the Company's
ordinary shares on AIM.

 

3.         REASONS FOR CANCELLATION

The primary reason the Board is proposing the Cancellation to Shareholders is
to achieve maximum value for Shareholders in its pursuit of a wind-down of the
Company's assets in order to achieve the maximum distribution within the
Outcome Range. It is the Board's view that the Cancellation will provide cost
savings (in contrast to remaining listed), greater strategic flexibility and
will be able to make and implement decisions more quickly than a company which
is publicly traded as a result of the more flexible regime which is applicable
to an unquoted company.

In reaching its conclusion regarding the Company's admission to trading on AIM
and that the Cancellation is in the best interests of the Company and its
Shareholders as a whole, the Board has considered the following key factors
amongst others:

(a)        Costs and Regulatory Burden: The considerable cost and
management time and the legal and regulatory burden associated with
maintaining the Company's admission to trading on AIM are, in the Board's
opinion, disproportionate to the benefits of the Company's continued admission
to trading on AIM. Given the lower costs associated with unlisted company
status, it is estimated that the Cancellation will materially reduce the
Company's recurring administrative and adviser costs, which the Board believes
would be a significant reduction in overhead cost burden;

(b)        Lack of liquidity: There continues to be limited liquidity
in the Ordinary Shares and, as a result, the Board believes that Shareholders
are not provided with opportunities to trade in meaningful volumes or with
frequency in an active market in the Ordinary Shares;

(c)        the Company's position as a micro-cap stock: Being a UK
micro-cap stock comes with a range of challenges which, in the Board's view,
stem from the Company's small market valuation, limited resources, and the
dynamic nature of the market. These challenges include, but are not limited
to:access to capital; (b) a lack of visibility amongst analysts, media and
potential investors; (c) increased volatility in company valuation unrelated
to company performance leading to higher risk perception; andan aversion from
potential new investors seeking stability and a valuation that aligns with
company performance. For these reasons, the Board believes that the Company is
not benefitting from being a listed company, and it does not see such
conditions changing;

(d)        Strategic flexibility: The Board believes that an unlisted
company can take and implement decisions more quickly than a company which is
publicly traded as a result of the more flexible regime that is applicable to
a private company. Assuming the Resolution is passed the Company will,
however, continue to pursue an orderly wind-down following Cancellation; and

(e)        Governance: Changes have recently been made to the
composition of the Board in order to seek to reduce overall costs and changes
to the composition of the board of Zytronic Displays Limited have similarly
recently been made, with further changes expected to occur in order to further
reduce costs. The Board recognises the desire of Shareholders for a return of
their investment and in order to effectively manage this process, appropriate
governance arrangements are required. The Board intends to adopt appropriate
corporate governance procedures for a public non-traded company and intends to
hold an annual general meeting for Shareholders prior to the proposed
wind-down.

4.         PROCESS FOR, AND PRINCIPAL EFFECTS OF, THE CANCELLATION

Under the AIM Rules, it is a requirement that Cancellation must be approved by
not less than 75 per cent. of votes cast by shareholders at a general meeting.
Accordingly, the Notice of General Meeting set out in Part III of this
Circular contains a special resolution to approve the Cancellation.

Furthermore, Rule 41 of the AIM Rules requires any AIM company that wishes the
London Stock Exchange to cancel the admission of its shares to trading on AIM
to notify shareholders and to separately inform the London Stock Exchange of
its preferred cancellation date at least 20 Business Days prior to such date.
Additionally, Cancellation will not take effect until at least five clear
business days have passed following the passing of the Resolution. In
accordance with AIM Rule 41, the Directors (through the Company's nominated
adviser, Singer Capital Markets) have notified the London Stock Exchange of
the Company's intention, subject to the Resolution being passed at the General
Meeting, to cancel the Company's admission of the Ordinary Shares to trading
on AIM at 8.00a.m. on 15 May 2025.

The Directors are aware that certain Shareholders may be unable or unwilling
to hold Ordinary Shares in the event that the Cancellation is approved and
becomes effective.

The principal effects of the Cancellation will be that:

(a)        there will no longer be a formal market mechanism enabling
Shareholders to trade their Ordinary Shares on AIM (or any other recognised
market or trading exchange);

(b)        the Ordinary Shares are likely to be more difficult to sell
compared to shares of companies traded on AIM, notwithstanding the fact that
trading in the Ordinary Shares was suspended with effect from

7.30 a.m. on 1 April 2025. It is possible that, following the publication of
this Circular, the liquidity and marketability of the Ordinary Shares is
reduced and their value adversely affected. However, as set out above, the
Directors believe that the existing liquidity in the Ordinary Shares is in any
event limited. In addition the Company intends to introduce a Secondary Market
Trading Facility for the Shares, to help facilitate purchases or sales of
shares, further details of which appear below under "Dealing and Settlement
Arrangements following Cancellation";

(c)        it may be more difficult for Shareholders to determine the
market value of their investment in the Company at any given time;

(d)        the Company will no longer be subject to the AIM Rules and,
accordingly, Shareholders will no longer be afforded the protections given by
the AIM Rules. In particular, the Company will not be bound to:

•           make any public announcements of material events, or
to announce interim or final results;

•           comply with any of the corporate governance practices
applicable to AIM companies;

•           announce substantial transactions and related party
transactions; or

•      comply with the requirement to obtain shareholder approval for
reverse takeovers and fundamental changes in the Company's business;

(e)        the Company will no longer be subject to UK MAR regulating
inside information and other matters;

(f)         the Company will no longer be required to publicly
disclose any change in major shareholdings in the Company under the Disclosure
Guidance and Transparency Rules;

(g)        the Company will cease to retain a nominated adviser and
broker;

(h)        notwithstanding that the Ordinary Shares are currently
suspended, whilst the Company's CREST facility will remain in place
immediately following the Cancellation the Company's CREST facility may be
cancelled in the future and, although the Ordinary Shares will remain
transferable, they may cease to be transferable through CREST (in which case,
Shareholders who hold Ordinary Shares in CREST will receive share
certificates);

(i)         stamp duty will be due on transfers of shares and
agreements to transfer shares unless a relevant exemption or relief applies to
a particular transfer; and

(j)         the Cancellation may have personal taxation consequences
for Shareholders. Shareholders who are in any doubt about their tax position
should consult their own professional independent tax adviser.

The above considerations are not exhaustive, and Shareholders should seek
their own independent advice when assessing the likely impact of the
Cancellation on them.

The Company currently intends that it will continue to provide certain
facilities and services to Shareholders that they currently enjoy as
shareholders of an AIM company following the proposed Cancellation. It is
intended that the Company will continue to:

(a)        communicate information about the Company (including annual
accounts) to its Shareholders, as required by law; and

(b)        maintain its website and to post updates on the website from
time to time, although Shareholders should be aware that there will be no
obligation on the Company to include all of the information required under AIM
Rule 26 or to update the website as required by the AIM Rules.

For the avoidance of doubt, the Company will remain registered with the
Registrar of Companies in England & Wales in accordance with and subject
to the Companies Act 2006, notwithstanding Cancellation.

 

 

5.         TRANSACTIONS IN ORDINARY SHARES PRIOR TO AND FOLLOWING
CANCELLATION

Prior to Cancellation

The Company's Shares were suspended with effect from 7.30 a.m. on 1 April 2025
pending publication of the Company's full year Annual Report and Accounts for
the year ended 30 September 2024 ("FY24 AR&A"). Shareholders have
therefore been unable to continue trading in the Ordinary Shares on AIM
following such date.

As announced by the Company on 28 March 2025, the Board does not anticipate
that publication of the       FY24 AR&A will occur prior to the
Cancellation date. Therefore, if the Resolution is passed, the final date of
trading on AIM in the Ordinary Shares will have been 31 March 2025.

Should Cancellation not Occur

Should the Resolution not be passed and Cancellation be unsuccessful,
admission of the Company's Ordinary Shares to trading on AIM will be
maintained, noting that trading on AIM in the Ordinary Shares was suspended
with effect from 7.30a.m. on 1 April 2025, pending publication of the
Company's FY24 AR&A. The Board does not have an estimate of when the FY24
AR&A will be published.

Dealing and settlement arrangements following Cancellation

The Board is aware that the proposed Cancellation, should it be approved by
Shareholders at the General Meeting, would make it difficult for Shareholders
to buy and sell Shares should they wish to do so. Accordingly, the Company
intends to introduce a Secondary Market Trading Facility for the Ordinary
Shares, to help facilitate

purchases or sales of Ordinary Shares should Cancellation occur. This
flexibility is so that Shareholders have the option to sell their Ordinary
Shares should they wish to do so but do not need to make that decision
immediately.

The Secondary Market Trading Facility will be provided by Asset Match, which
is authorised and regulated by the Financial Conduct Authority (FRN 579310).
Further details of the Secondary Market Trading Facility can be found at
www.assetmatch.com. This facility will allow existing Shareholders and new
investors to trade Ordinary Shares by matching buyers and sellers through
periodic auctions. Investors are encouraged to register on www.assetmatch.com
and add Zytronic to their 'Watchlist' to continue to receive Company updates
and auction/price information.

Shareholders wishing to trade these securities can do so through their
stockbroker. The Asset Match trading facility operates under its own code of
practice which governs the behaviour of participants and the running of the
periodic auctions. Asset Match operates an open auction system where volumes
of bids and offers at different prices are displayed in an order book on its
website together with the closing date of the auction. At the end of each
auction period, Asset Match passes this information through a
non-discretionary algorithm that determines a "market-derived" share price
based on supply and demand and allocates transactions accordingly. Bids and
offers may be made and withdrawn at any time before the closing date of each
auction.

Shareholders will continue to be able to hold their Shares in uncertificated
form (in CREST) and should check with their existing stockbroker whether they
are willing or able to trade in unquoted shares. Shareholders wishing to trade
shares through Asset Match must do so through a stockbroker. A comprehensive
list of stockbrokers who have signed up to access the Asset Match platform is
available on request from Asset Match.

Full details will be made available to Shareholders on the Company's website
at www.zytronic.co.uk and directly by letter or e-mail (where appropriate).
Shareholders may contact Asset Match in relation to any queries regarding
trading via the secondary market trading facility by emailing
dealing@assetmatch.com.

The Secondary Market Trading Facility is expected to be available for a period
of at least one year after Cancellation. The Directors' current intention is
that it will continue beyond that time but Shareholders should note that it
could be withdrawn and therefore inhibit the ability to trade the Shares.
Further details will be communicated to the Shareholders at the relevant time.

Shareholders are invited to retain their Ordinary Shares in the Company, but
are welcome to participate in the monthly auctions under the Secondary Market
Trading Facility operated by Asset Match, which will allow Shareholders to
sell down their holdings should they wish to do so.

The Company expects the Secondary Market Trading Facility to be available for
Shareholders who wish to sell their Shares to make that instruction from 15
May 2025, with the first auction closing on 17 June 2025 followed by monthly
auctions thereafter.

6.         TAKEOVER CODE

The Takeover Code (the "Code") applies to any company which has its registered
office in the UK, the Channel Islands or the Isle of Man if any of its equity
share capital or other transferable securities carrying voting rights are
admitted to trading on a UK regulated market, a UK MTF, or a stock exchange in
the Channel Islands or the Isle of Man. The Code therefore applies to the
Company as its securities are admitted to trading on AIM, which is a UK MTF.

The Code also applies to any company which has its registered office in the
UK, the Channel Islands or the Isle of Man if any of its securities were
admitted to trading on a UK regulated market, a UK MTF, or a stock exchange in
the Channel Islands or the Isle of Man at any time during the preceding two
years.

Accordingly, if the Cancellation is approved by Shareholders at the General
Meeting and becomes effective, the Code will continue to apply to the Company
for a period of two years after the Cancellation, following which  the Code
will cease to apply to the Company.

While the Code continues to apply to the Company, a mandatory cash offer will
be required to be made if either:

(a)        any person acquires an interest in shares which (taken
together with the shares in which the person or any person acting in concert
with that person is interested) carry 30% or more of the voting rights of the
company; or

(b)        any person, together with persons acting in concert with
that person, is interested in shares which in the aggregate carry not less
than 30% of the voting rights of a company but does not hold shares carrying
more than 50% of such voting rights and such person, or any person acting in
concert with that person, acquires an interest in any other shares which
increases the percentage of shares carrying voting rights in which that person
is interested.

Brief details of the Takeover Panel, and of the protections afforded by the
Code, are set out in Part II of this document.

Before voting on the Cancellation, you may want to take independent
professional advice from an appropriate independent financial adviser.

The Code

The Code is issued and administered by the Panel. The Code currently applies
to the Company and, accordingly, Shareholders are entitled to the protections
afforded by the Code.

The Code and the Panel operate principally to ensure that shareholders in an
offeree company are treated fairly and are not denied an opportunity to decide
on the merits of a takeover and that shareholders in the offeree company of
the same class are afforded equivalent treatment by an offeror. The Code also
provides an orderly framework within which takeovers are conducted. In
addition, it is designed to promote, in conjunction with other regulatory
regimes, the integrity of the financial markets.

The Code is based upon a number of General Principles, which are essentially
statements of standards of commercial behaviour. The General Principles apply
to takeovers and other matters to which the Code applies. They are applied by
the Panel in accordance with their spirit in order to achieve their underlying
purpose.

In addition to the General Principles, the Code contains a series of rules.
Like the General Principles, the rules are to be interpreted to achieve their
underlying purpose. Therefore, their spirit must be observed as well as their
letter. The Panel may derogate or grant a waiver to a person from the
application of a rule in certain circumstances.

A summary of key points regarding the application of the Code to takeovers is
set out in Part II.

 

7.         GENERAL MEETING

The General Meeting will be held at Ward Hadaway LLP, Sandgate House, 102
Quayside, Newcastle Upon Tyne NE1 3DX commencing at 3.00p.m. on 7 May 2025 to
propose the Resolution.

8.         ACTION TO BE TAKEN

Hard copy proxy forms are being sent to Shareholders in connection with the
General Meeting although the Company would like to encourage Shareholders to
vote electronically or appoint a proxy electronically, which can be done via
www.investorcentre.co.uk/eproxy or, where Ordinary Shares are held in CREST,
via CREST. Notwithstanding the method of appointment, proxy appointments must
be received by 3.00p.m. on 2 May 2025, being 48 hours (excluding non-working
days) before the time fixed for the General Meeting. Further details of the
proxy appointment methods are set out in the Notice of General Meeting. The
appointment of a proxy will not preclude Shareholders from attending and
voting in person at the General Meeting should they wish to do so.

Shareholders are encouraged to appoint the chair of the General Meeting as
their proxy with directions as to how to cast their vote on the Resolution.
For further details on how to submit a proxy vote, see the notes to the Notice
of General Meeting at Part III of this Circular.

The appointment of a proxy will not preclude Shareholders from attending and
voting in person at the General Meeting should they wish to do so.

9.         IMPORTANCE OF VOTE

If a sufficient percentage of Shareholders vote against the Resolution, such
that the resolution is not passed, then the Company would remain listed and
continue to incur relevant costs, further depleting its available cash
resources. Even if a sufficient percentage of Shareholders vote against the
Resolution, such that the Resolution is not passed at the General Meeting and
the Company remains listed, due to the orderly wind-down being implemented,
cessation of trading will occur meaning that the Company's listed status will
in any event no longer continue upon cessation of trading.

10.        RECOMMENDATION

For the reasons noted above, the Directors consider that the Resolution to be
put to the meeting is in the best interests of the Company and its
stakeholders as a whole and therefore unanimously recommend that you vote
in favour of the Resolution to be proposed at the General Meeting, as those
Directors who hold Ordinary Shares intend to do in respect of their own
aggregate holdings of 88,278 Ordinary Shares, representing approximately 0.87
per cent. of the Company's issued share capital as of the date of this
Circular.

Yours faithfully,

 

Dr. Christopher Potts

Non-executive Chairman

Zytronic plc

Appendix II

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

"AIM"
AIM, the market operated by the London Stock Exchange

"AIM
Rules"
the rules and guidance for companies whose shares are admitted to trading on
AIM entitled "AIM Rules for Companies" published by the London Stock Exchange,
as amended from time to time

"Asset
Match"
Asset Match Limited (company registration number:  07681197) whose registered
office is at New Broad Street House, 35 New Broad Street, London EC2M 1NH

"Business
Day"                                   a day
(excluding Saturday, Sunday and public holidays in England and Wales) on which
banks are generally open for business in London for the transaction of normal
banking business

"Cancellation"
subject to passing of the Resolution the cancellation of admission of the
Ordinary Shares to trading on AIM in accordance with Rule 41 of the AIM Rules

"Circular"
this document, containing information about the Cancellation and the General
Meeting

"Company" or "Zytronic"                   Zytronic plc, a
company incorporated in England and Wales with Registered Number 03881244

"CREST"
the relevant system (as defined in the CREST Regulations) in respect of which
Euroclear is the operator (as defined in those regulations)

"CREST Regulations"                        the
Uncertificated Securities Regulations 2001 (S.I. 2001 No 3755) (as amended),
and any applicable rules made thereunder

"Directors" or "Board"                         the
directors of the Company, whose names are set out on page 4 of this document

"Disclosure Guidance and                 the disclosure rules
and transparency rules made by the UK Transparency
Rules"
Financial Conduct Authority pursuant to section 73A of FSMA

"FRP Advisory"
FRP Advisory Trading Limited

"Euroclear"
Euroclear UK & International Limited, the operator of CREST

"Form of Proxy"
the form of proxy accompanying this Circular for use by Shareholders relating
to the General Meeting

"General Meeting"                             the
General Meeting of the Company convened for 3.00p.m.on 7 May 2025 and any
adjournment thereof, notice of which is set out in Part III of this Circular

"Group"
the Company and its wholly-owned trading subsidiary Zytronic Displays Limited
(registered number: 00379908)

"London Stock Exchange"                 London Stock Exchange
plc

"Notice of General Meeting" or          the notice of General Meeting
which is set out in Part III of this "Notice"     Circular

"Ordinary Shares"
ordinary shares of £0.01 each in the capital of the Company and "Ordinary
Share" means any one of them

"Panel"
the Panel on Takeovers and Mergers

"Registrars"
Computershare Investor Services Plc of The Pavilions, Bridgewater Road,
Bristol, BS13 8AE

"Regulatory Information Service"      has the meaning given to it in the
AIM Rules

"Resolutions"
the resolutions to be proposed at the General Meeting in the form set out in
the Notice

"Secondary Market Trading               the unregulated
electronic trading platform operated by

Facility"
 
Asset Match to be put in place by the Company subject to the passing of the
Resolutions

 

"Shareholders"
holders of Ordinary Shares from time to time and "Shareholder" means any one
of them

"Singer Capital Markets"                   Singer Capital
Markets Advisory LLP of One Bartholomew Lane, London, EC2N 2AX

"Takeover Code"
the City Code on Takeovers and Mergers

"UK
MAR"
Regulation (EU) (No 596/2014) of the European Parliament and of the Council of
16 April 2014 on market abuse to the extent that it forms part of the domestic
law of the United Kingdom including by virtue of the European Union
(Withdrawal) Act 2018 (as amended by virtue of the European Union (Withdrawal
Agreement) Act 2020)

"UK
MTF"
a UK multilateral trading facility

"United Kingdom"                             the
United Kingdom of Great Britain and Northern Ireland

 

A reference to "£" is to pounds sterling, being the lawful currency of the UK

 

 

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