Proposed Debt Restructuring and Placing
THIS ANNOUNCEMENT (INCLUDING THE APPENDICES) AND THE INFORMATION CONTAINED HEREIN ARE RESTRICTED AND ARE NOT FOR PUBLICATION, RELEASE OR DISTRIBUTION, DIRECTLY OR INDIRECTLY, IN WHOLE OR IN PART, IN OR INTO THE UNITED STATES OF AMERICA, CANADA, AUSTRALIA, NEW ZEALAND, THE REPUBLIC OF SOUTH AFRICA OR JAPAN OR IN OR INTO ANY OTHER JURISDICTION WHERE TO DO SO WOULD BREACH ANY APPLICABLE LAW OR REGULATION.
THIS ANNOUNCEMENT (INCLUDING THE APPENDICES) IS FOR INFORMATION PURPOSES ONLY AND DOES NOT ITSELF CONSTITUTE AN OFFER FOR SALE OR SUBSCRIPTION OF ANY SECURITIES IN THE COMPANY. THIS ANNOUNCEMENT (INCLUDING THE APPENDICES) DOES NOT CONSTITUTE OR CONTAIN ANY INVITATION, SOLICITATION, RECOMMENDATION, OFFER OR ADVICE TO ANY PERSON TO SUBSCRIBE FOR, OTHERWISE ACQUIRE OR DISPOSE OF ANY SECURITIES OF ECHO ENERGY PLC IN ANY JURISDICTION WHERE TO DO SO WOULD BREACH ANY APPLICABLE LAW OR REGULATION.
THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION FOR THE PURPOSES OF THE UK VERSION OF THE MARKET ABUSE REGULATION (EU NO . 596/2014) AS IT FORMS PART OF UNITED KINGDOM DOMESTIC LAW BY VIRTUE OF THE EUROPEAN UNION (WITHDRAWAL) ACT 2018 ("UK MAR"). IN ADDITION, MARKET SOUNDINGS (AS DEFINED IN UK MAR) WERE TAKEN IN RESPECT OF CERTAIN OF THE MATTERS CONTAINED IN THIS ANNOUNCEMENT, WITH THE RESULT THAT CERTAIN PERSONS BECAME AWARE OF SUCH INSIDE INFORMATION, AS PERMITTED BY UK MAR. UPON THE PUBLICATION OF THIS ANNOUNCEMENT, THIS INSIDE INFORMATION IS NOW CONSIDERED TO BE IN THE PUBLIC DOMAIN AND SUCH PERSONS SHALL THEREFORE CEASE TO BE IN POSSESSION OF INSIDE INFORMATION .
12 August 2022
Echo Energy plc
("Echo" or the "Company" and together with its subsidiaries the "Group")
Proposed Debt Restructuring
Proposed Placing and Conditional Grant of Warrants
Echo Energy plc (AIM:ECHO), the Latin American focused Energy company, is pleased to announce a proposed comprehensive debt restructuring together with a placing of new Ordinary Shares ("Placing Shares") which will be conducted by way of an accelerated bookbuild (the "Bookbuild") to raise not less than £450,000, before expenses, at a fixed price of 0.25 pence per share (the "PlacingPrice") to investors (the "Placing"). The Placing Shares will rank pari-passu with the Company's existing Ordinary Shares.
The Company announces a proposed restructuring of its existing debts, pursuant to which the Company has entered into a conditional agreement with Lombard Odier Asset Management (Europe) Limited* ("LO") to, inter alia, convert in full the Company's existing EUR 5.0m 8.0% secured convertible debt facility with LO (the "LO Facility") into new Ordinary Shares at a price of 0.45p per share representing a substantial premium of 75.1% to the closing mid-market price per Ordinary Share of 0.257p on 11 August 2022 (the "LO Agreement").
Highlights
• Proposed conversion of an aggregate of €15.0 million of existing debt principal, together with accrued interest thereon, excluding the LO Interest Conversion shares, into new Ordinary Shares at a price of 0.45p representing a 75.1% premium to the closing share price on 11 August 2022.
• Proposed reduction of remaining Note coupon from 8% to 2% with suspension of further cash interest payments for two years. Remaining Note maturity extended to 2032
• If completed the Proposed Debt Restructuring will comprehensively restructure and strengthen the Company's balance sheet, transforming the balance of value in favour of equity over debt, enabling the Company to seek to accelerate its growth strategy
• The Company intends to conduct a Bookbuild to raise not less than £450,000 (before expenses) by way of a Placing of the Placing Shares at the Placing Price.
• The Placing is to be conducted by way of an accelerated bookbuild process which will commence immediately following this Announcement and will be subject to the terms and conditions set out in Appendix II to this Announcement.
• The net proceeds of the Placing will provide the Group with additional resources to:
- Fund working capital including expenses related to the Proposed Debt Restructuring; and
- Enable operating cashflows in Argentina to be focused on activities in country in the near term, including the plan to increase production by c. 40% over approximately the next 6 months.
Under the LO Agreement, LO has conditionally agreed to the conversion of accrued interest on the LO Facility into new Ordinary Shares for the periods Q3 2021 to 31 October 2022 inclusive, at a conversion price of 0.25 pence per new Ordinary Share ("LO Interest Conversion"). Accordingly, the Company has agreed to issue to LO 213,949,943 new Ordinary Shares (the "LO Interest Conversion Shares"). The LO Interest Conversion Shares will rank pari-passu with the Company's existing Ordinary Shares.
The Company also proposes to seek the approval of the holders of the Company's Luxembourg listed EUR 20.0m 8.0% secured notes (the "Notes") for, inter alia, the conversion of 50% of the Notes and all accrued interest thereon into new Ordinary Shares, an extension of the term of the remaining Notes to 2032 and a significant reduction in coupon for the remainder of the term (the "Note Restructuring" and, together with the LO Agreement, the "Proposed Debt Restructuring"). Further details of the Proposed Debt Restructuring are set out in Appendix I below.
In connection with the Placing, the Company will also grant investors in the Placing 1.07 warrants for every one Placing Share subscribed for ("Warrants"). No fractional part of a Warrant will be issued and fractional entitlements will be rounded down to the nearest whole number. Each Warrant gives the holder the right to subscribe for one new Ordinary Share at a price of 0.25 pence per Ordinary Share (the "Strike Price") at any time until the second anniversary of issue (the "Warrant Exercise Period").
The Company currently has the authority to issue up to 290,498,000 equity securities for cash without the need for shareholder approval. The grant of the Warrants will be conditional on shareholder approval, which will be sought at the general meeting which the Company will convene for the purposes of laying the Company's annual report and financial statements for the financial year ended 31 December 2021 before shareholders. The Company will publish the relevant circular convening the meeting in due course.
Arden Partners plc ("Arden" or "Broker") is acting as the sole bookrunner in relation to the Placing.
The Placing is not conditional upon the Proposed Debt Restructuring becoming effective. As such, the Placing will complete before the Proposed Debt Restructuring and there can be no guarantee that the Proposed Debt Restructuring will become effective.
The Bookbuild will open with immediate effect following release of this Announcement. The timing of the closing of the Bookbuild, the number of Placing Shares and allocations are at the discretion of the Company and Arden and a further announcement confirming these details is expected to be made in due course. Arden reserves the right to close the Bookbuild without further notice. There can be no certainty that the Placing will complete.
The Placing of the Placing Shares will utilise the Company's existing shareholder authorities to issue new shares on a non-pre-emptive basis for cash. New shareholder authorities to grant the Warrants will be sought at a general meeting to be convened in due course.
The Placing Price of 0.25 pence per Placing Share represents a discount of approximately 3% per cent. to the closing mid-market price of an Ordinary Share on 11 August 2022 (being the latest practicable date prior to this Announcement).
This Announcement should be read in its entirety. In particular, your attention is drawn to the detailed terms and conditions of the Placing in Appendix II to this Announcement. Further information relating to the Placing and use of proceeds is set out in Appendix I to this Announcement.
The Placing is subject to the terms and conditions set out in Appendix II to this announcement (which forms part of this announcement, such announcement and the Appendices to this Announcement together being this "Announcement"). By choosing to participate in the Placing and by making an oral and legally binding offer to acquire Placing Shares, investors will be deemed to have read and understood this Announcement in its entirety, and to be making such offer on the terms and subject to the conditions of the Placing contained herein, and to be providing the representations, warranties and acknowledgements contained in Appendix II.
*acting in its capacity as discretionary investment manager of certain funds and accounts managed by it, not as principal.
Martin Hull, CEO of Echo Energy, commented:
"This is an important milestone for Echo, which if completed will fundamentally change the outlook for the company for the positive. By comprehensively restructuring and strengthening the balance sheet, we establish firm foundations for the business financially, from which we will be able to pursue the many opportunities that exist within our portfolio. The conditional conversion of debt into equity at a large premium by our largest single debt holder represents a vote of confidence in the Company's future. This transaction combined with the recently announced near term production enhancement plans and in the context of the highly supportive commodity price environment have transformed the prospects for Echo. We look forward to updating investors on our progress and thank them and our debt holders for their continuing support."
Enquiries:
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Echo Energy |
via Vigo Communications |
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Martin Hull, Chief Executive Officer |
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Vigo Consulting (IR & PR Adviser) |
+44 (0) 20 7390 0230 |
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Patrick d'Ancona |
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Chris McMahon |
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Cenkos Securities (Nominated Adviser) |
+44 (0) 20 7397 8900 |
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Ben Jeynes |
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Katy Birkin |
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Arden Partners plc (Sole Bookrunner and Corporate Broker) |
+44 (0) 20 7614 5900 |
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Simon Johnson (Corporate Broking) |
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John Llewellyn-Lloyd (Corporate Finance) |
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Alex Campbell-Harris (Corporate Finance) |
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About Echo Energy
Echo is a Latin American focused energy company with a 70% non-operated participation in the Santa Cruz Sur assets, consisting of five production concessions, which produce gas and oil. The Santa Cruz Sur assets are located in the Austral basin, onshore Argentina and with infrastructure in place for gas transport by pipeline to Buenos Aires and oil sales at the Punta Layola terminal for both domestic and export sales.
The assignment of Echo's 70% non-operated participation in the Santa Cruz Sur licences remains subject to the authorisation of the Executive Branch of Santa Cruz's Province, which is part of the overall process of title transfer that is proceeding as anticipated. The current Santa Cruz Sur licences expire in April 2026 and, in connection with the Santa Cruz Sur partners'
Production and Infrastructure Enhancement Plan for the assets, details of which were announced on 7 July 2022, the Santa Cruz Sur partners intend to engage with the local province in respect of a proposed extension to the term of the Santa Cruz Sur licences.
APPENDIX I - ADDITIONAL INFORMATION
Background to and reasons for the Placing
On 7 July 2022, the Company announced, in addition to providing a production and operational update, that the Santa Cruz Sur partners had agreed to a production and enhancement plan to materially increase production at Santa Cruz Sur and to improve the quality of sales liquids from the Santa Cruz Sur assets (the "Enhancement Plan") .
Over a six-month period, anticipated to commence in Q3 2022, the Santa Cruz Sur partners intend to seek to increase production by approximately 40% from the levels previously achieved over H1 2022. If achieved, the Enhancement Plan would increase total daily production from Santa Cruz Sur to around 2,000 boepd, net to Echo's 70% interest in Santa Cruz Sur.
The Company has since been pleased to announce that, in respect of the first operational priority under the Enhancement Plan to upgrade the power generation capacity sufficient to sustain the elevated production levels anticipated as possible under the Plan, a contract for the long-term provision of gas-powered electricity generation units for installation across the Cerro Molino Oeste, El Indio Oeste and Oceano fields had been signed.
Accordingly, equipment has now been mobilised to the field in Santa Cruz Sur and installation is anticipated to take a month from commencement. The new generation infrastructure consists of one unit of 1,375 Kilo Volt Amps (KVA) capacity for the Cerro Molino Oeste field, one unit of 375 KVA capacity for the El Indio Oeste field, and one unit of 375 KVA capacity to be installed in the Oceano field. The on-site installation and commission of all three units began during the week commencing 25 July 2022, notwithstanding the winter conditions currently being experienced at Santa Cruz Sur, with the work will be undertaken by Santa Cruz Sur Joint Venture staff.
El Indio Oeste will be installed first, followed by Oceano and then Cerro Molino Oeste. These works will be carried out with the intention of minimising any disruption to existing gas and oil production, although some temporary impact is expected. Following these units' installation, additional power will be available to support existing and future production levels. Although there may be some increase to current production, these infrastructure upgrades are in preparation for the recommissioning of shut-in wells using the Joint Venture rig. Work has also commenced on upgrading this pulling rig in anticipation of this upcoming set of operations. The installation of the additional power generation capacity, alongside the upgrading of the workover rig, represents a critical step in the delivery of the Plan.
With the agreement between the Santa Cruz Sur partners as to the Enhancement Plan, the delivery of the intended operations is expected to require an estimated US$2.1 million (gross to 100% Santa Cruz Partnership) to deliver in full over the entire duration of the Enhancement Plan's implementation and, notwithstanding existing Santa Cruz Sur joint venture creditor balances of an estimated (unaudited) c.$13.9m ($9.7m net to Echo's 70% interest) as at 30 April 2022, the Santa Cruz Sur partners currently believe that a significant proportion of the cost of the Enhancement Plan can be met from existing, and to be increased, Santa Cruz Sur cash flows.
The net proceeds of the Placing will increase the Group's working capital resources and, subject to the Proposed Debt Restructuring becoming effective, will provide the Company with additional resources with which to continue to seek to advance the Enhancement Plan in meeting the Company's 70% interest in the Santa Cruz Sur assets. In continuing to advance the Enhancement Plan, the Santa Cruz Sur partners intend to engage with the local province in respect of a proposed extension to the term of the Santa Cruz Sur licences.
Update regarding publication of 2021 Annual Report
On 27 June 2022, Echo announced that AIM Regulation had granted the Company an additional period of up to two months to publish its annual audited accounts for the year ended 31 December 2021. The Company must therefore publish its annual audited accounts for the year ended 31 December 2021 (the "2021 Annual Report") by 31 August 2022 but will endeavour to do so as soon as possible.
With prior delays in the ability of the local Argentinian Santa Cruz Sur joint venture entity in which Echo holds a 70% interest (the "SCS JV") to provide information to its Argentinian auditor now resolved, and the local Argentinian auditor now having received all outstanding information, the Company continues to expect that it will be able to publish its 2021 Annual Report prior to 31 August 2022.
The Company's cash balances as at 30 April 2022 stood at c.US$1.6 million (including US$1.0 million of Echo's 70% interest of SCS JV cash balances in Argentina). Echo's consolidated cash position as at 31 December 2021 was US$0.9m, up 28% from US$0.6m as at 31 December 2020.
The Proposed Debt Restructuring
LO Agreement
Under an agreement entered into on today's date, LO has conditionally agreed to the conversion in full of the principal of the LO Facility with the Company.
The terms of the LO Facility (as amended) were first announced by the Company on 21 October 2019 and as at 31 October 2022, the total outstanding debt and accrued interest of the LO Facility will amount to EUR 6,225,256.
Under the LO Agreement, LO has conditionally agreed to the conversion in full of the principal of the LO Facility together with accrued interest on the LO Facility for the periods Q1 2020 to Q2 2021 inclusive into new Ordinary Shares in the Company at a conversion price of 0.45 pence per new Ordinary Share, subject to, inter alia, the approval of Echo shareholders and the Note Restructuring becoming effective.
In addition, LO has conditionally agreed pursuant to the LO Agreement to the conversion of the accrued interest on the Facility for periods Q3 2021 to 31 October 2022 inclusive to new Ordinary Shares at a conversion price of 0.25 pence per new Ordinary Share. The accrued interest to 31 October 2022 will amount to EUR 625,803.58. Accordingly, the Company has conditionally agreed to issue to LO 213,949,943 LO Interest Conversion Shares.
The conversion of the interest and the corresponding issue of the LO Interest Conversion Shares is conditional, inter alia, on (i) the Placing raising a minimum of £450,000 (gross) for the Company; (ii) the Placing Agreement becoming unconditional in accordance with its terms; and (iii) admission of the LO Interest Conversion Shares to trading on AIM.
The LO Interest Conversion Shares shall be issued by the Company using the Company's existing share authorities which were granted to the Directors by shareholders at the annual general meeting of the Company held on 27 June 2022. As detailed below under Admission, settlement and CREST, admission of the LO Interest Conversion Shares is expected to take place on 29 August 2022, together with the Placing Shares. The LO Interest Conversion Shares, when issued, will be fully paid and will rank pari passu in all respects with the existing Ordinary Shares.
Under the LO Agreement, the Company has agreed to pay LO a fee of 6% of amounts of the LO Facility and Accrued Interest converted into new Ordinary Shares at a price of 0.45 pence per new Ordinary Share, payable in new Ordinary Shares in the Company ("Fee Shares") at an effective issue price of 0.45 pence per Fee Share. As a result, in the event that the conditions to the LO Agreement are satisfied, the Company would, issue up to c.1.3 billion new Ordinary Shares in respect of the full conversion of the LO Facility and accrued LO Facility interest (subject to the prevailing FX rate on the date of conversion).
Pursuant to the LO Agreement, the Company has undertaken not to restructure, by sub-division or otherwise, the nominal value of the Ordinary Shares for a period of 12 months without LO's prior written consent. LO may not provide such consent unless the Company undertakes that, if during that 12 month period it issues any Ordinary Shares at any value lower than the current nominal value, it will offer for subscription for nil consideration (to the extent it is able to do so in compliance with the Companies Act 2006) to LO such number of new Ordinary Shares as shall equate to the number of Ordinary Shares that LO would have received under the LO Agreement had the new issue price being used as the issued price under the LO Agreement.
Notes Proposal
On 15 May 2017, the Company issued EUR 20 million five-year secured bonds with a coupon of 8.0% (the "Notes"). As at 30 September 2022, following subsequent restructurings to the Notes, the total outstanding debt and accrued interest of the Notes will be EUR 24,401,096.
The LO Agreement is conditional, inter alia, upon a restructuring of the Notes. As a result, the Company intends to seek Noteholder approval for the restructuring of the Notes to: (a) convert 50% of Notes and accrued interest into new Ordinary Shares at a conversion price of 0.45 pence per Ordinary Share; (b) extend the term of the remaining Notes to 2032; (c) suspend cash interest payments on remaining Notes for two years; and (d) reduce Note coupon to 2% (from 8%) for the remainder of the Note term. The Company intends to propose a fee payable to Noteholders on the same terms as set out under the LO Agreement and further details of the Note Restructuring will be announced, as appropriate, in due course. The Note Restructuring will be subject to the approval of Noteholders and to Echo shareholder approval.
The Proposed Debt Restructuring will be conditional upon the success of the Note Restructuring and approval by the Company's shareholders at a General Meeting for the authorities to issue the new Ordinary Shares required to be issued on conversion.
Those investors wishing to participate in the Placing should be aware that the Proposed Debt Restructuring will, if approved by Note holders and by the Company's shareholders, take place following Admission.
As a result, the details provided in relation to the Placing in this Announcement are based on the position of the Company prior to further equity being issued as part of the Proposed Debt Restructuring. Investors should therefore be aware that any Ordinary Shares currently held, or acquired pursuant to the Placing, may be subject to dilution as a result of the Proposed Debt Restructuring. In addition, those investors wishing to participate in the Placing should be aware that there can be no certainty that the Proposed Debt Restructuring will become effective. The Board of the Company intends to recommend to shareholders to vote in favour of the Proposed Debt Restructuring at the required General Meeting.
The Placing
The Company and Arden have today entered into a placing agreement (the "Placing Agreement"), pursuant to which, on the terms and subject to the conditions set out therein, Arden has agreed to use its reasonable endeavours to procure, as the Company's agent, Placees for the Placing Shares at the Placing Price, raising gross proceeds of a minimum of £450,000 for the Company.
The Placing Agreement contains customary undertakings and warranties given by the Company to Arden including as to the accuracy of information contained in this Announcement, to matters relating to the Company and its business and a customary indemnity given by the Company to Arden in respect of liabilities arising out of or in connection with the Placing.
The terms and conditions of the Placing are set out in Appendix II to this Announcement.
The timing for the close of the Bookbuild and the allocation of the Placing Shares will be determined by Arden and the Company.
The final number of Placing Shares to be issued pursuant to the Placing will be determined following closure of the Bookbuild. The Placing Shares, when issued, will be fully paid and will rank pari passu in all respects with the existing Ordinary Shares. The Placing has been arranged by Arden in accordance with the terms and conditions set out in Appendix II to this Announcement. The Bookbuild in respect of the Placing is expected to close not later than 7a.m. (London time) on 15 August 2022, but may be closed at such earlier or later time as the Broker, in their absolute discretion (following consultation with the Company), determine.
Details of the result of the Placing will be announced as soon as practicable after closure of the Bookbuild. Attention is drawn to the detailed terms and conditions of the Placing described in Appendix II (which forms part of this Announcement). By choosing to participate in the Placing and by making an oral and legally binding offer to acquire Placing Shares, investors will be deemed to have read and understood this Announcement in its entirety (including the Appendices) and to be making such offer on the terms and subject to the conditions in it, and to be providing the representations, warranties and acknowledgements contained in Appendix II.
The Placing is not conditional upon the approval of the Company's shareholders and is not conditional upon the Proposed Debt Restructuring becoming effective.
Warrants
Conditional upon shareholder approval, the Company will grant investors in the Placing with 1.07 warrants for every one Placing Share subscribed for. No fractional part of a Warrant will be issued and fractional entitlements will be rounded down to the nearest whole number. The Warrants will be exercisable at a price of 0.25 pence per Ordinary Share for a period of two years from the date of issue. The Warrants will be unlisted, non-transferable and issued in certificated form.
The grant of the Warrants will be conditional upon, the passing of resolutions to be put to shareholders of the Company at a general meeting of the Company ("GM") to provide authority to the Directors to issue and allot further new Ordinary Shares (or grant rights over such shares) for cash on a non-pre-emptive basis. A circular containing a notice of the GM will be posted to shareholders shortly.
Arden Fees
Certain fees and commissions payable by the Company to Arden pursuant to the Placing Agreement shall be satisfied by the Company by the issue by the Company to Arden of new Ordinary Shares (the "Broker Fee Shares") at the Placing Price. The final number of Broker Fee Shares to be issued pursuant to the Placing Agreement will be determined following closure of the Placing. The Broker Fee Shares, when issued, will be fully paid and will rank pari passu in all respects with the existing Ordinary Shares.
Adviser Fees
Certain outstanding fees which are due and payable by the Company to a third party adviser shall be satisfied by the Company by the issue of 8,000,000 new Ordinary Shares (the "Adviser Shares") at the Placing Price. The Adviser Shares, when issued, will be fully paid and will rank pari passu in all respects with the existing Ordinary Shares.
Placee Commissions
As is permitted by the Companies Act 2006 and the Company's articles of association, the Company is permitted to pay commission to subscribers in consideration for their subscription of new Ordinary Shares. In the event that such commissions are agreed and become payable by the Company, the Company is intending to satisfy such liabilities by the issue to the relevant Placees of additional new Ordinary Shares at the Placing Price (the "Placee Commission Shares"). The final number of Placee Commission Shares to be issued by the Company will be determined following closure of the Placing. The Placee Commission Shares, when issued, will be fully paid and will rank pari passu in all respects with the existing Ordinary Shares.
Admission, settlement and CREST
Applications will be made for the Placing Shares, the Broker Fee Shares, the Adviser Shares, the LO Interest Conversion Shares and the Placee Commission Shares (the "New Ordinary Shares") to be admitted to trading on AIM ("Admission").
Settlement for and admission of the New Ordinary Shares to trading on AIM is expected to take place on or before 8.00 a.m. on 29 August 2022 ("Admission"). The Placing is conditional upon, among other things, admission of the Placing Shares becoming effective, and the Placing Agreement not being terminated in accordance with its terms.
IMPORTANT INFORMATION
This Announcement has been issued by, and is the sole responsibility of, the Company. No representation or warranty express or implied, is or will be made as to, or in relation to, and no responsibility or liability is or will be accepted by Arden or Cenkos or by any of their affiliates as to or in relation to, the accuracy or completeness of this Announcement or any other written or oral information made available to or publicly available to any interested party or its advisers, and any liability therefore is expressly disclaimed.
This Announcement does not constitute, or form part of, a prospectus relating to the Company, nor does it constitute or contain any invitation or offer to any person, or any public offer, to subscribe for, purchase or otherwise acquire any shares in the Company or advise persons to do so in any jurisdiction, nor shall it, or any part of it (other than Appendix II in relation to Placees) form the basis of or be relied on in connection with any contract or as an inducement to enter into any contract or commitment with the Company. In particular, the Placing Shares have not been, and will not be, registered under the Securities Act or qualified for sale under the laws of any state of the United States or under the applicable laws of any of Canada, Australia, the Republic of South Africa, or Japan and, subject to certain exceptions, may not be offered or sold in the United States or to, or for the account or benefit of, US persons (as such term is defined in Regulation S under the Securities Act) or to any national, resident or citizen of Canada, Australia, the Republic of South Africa or Japan.
The distribution or transmission of this Announcement and the offering of the New Ordinary Shares in certain jurisdictions may be restricted or prohibited by law or regulation. Persons distributing this Announcement must satisfy themselves that it is lawful to do so. Any failure to comply with these restrictions may constitute a violation of the securities laws of any such jurisdiction. No action has been taken by the Company or the Broker that would permit an offering of such shares or possession or distribution of this Announcement or any other offering or publicity material relating to such shares in any jurisdiction where action for that purpose is required. Persons into whose possession this Announcement comes are required by the Company and the Broker to inform themselves about, and to observe, such restrictions. In particular, this Announcement may not be distributed, directly or indirectly, in or into the United States, Canada, the Republic of South Africa, Australia or Japan. Overseas Shareholders and any person (including, without limitation, nominees and trustees), who have a contractual or other legal obligation to forward this document to a jurisdiction outside the UK should seek appropriate advice before taking any action.
This Announcement contains "forward-looking statements" which includes all statements other than statements of historical fact, including, without limitation, those regarding the Company's financial position, business strategy, plans and objectives of management for future operations, or any statements preceded by, followed by or that include the words "targets", "believes", "expects", "aims", "intends", "will", "may", "anticipates", "would", "could", "indicative", "possible" or similar expressions or negatives thereof. Such forward-looking statements involve known and unknown risks, uncertainties and other important factors beyond the Company's control that could cause the actual results, performance or achievements of Echo Energy plc to be materially different from future results, performance or achievements expressed or implied by such forward-looking statements. Such forward-looking statements are based on numerous assumptions regarding the Company's present and future business strategies and the environment in which the Company will operate in the future. These forward-looking statements speak only as at the date of this Announcement. The Company expressly disclaims any obligation or undertaking to disseminate any updates or revisions to any forward-looking statements contained herein to reflect any change in the Company's expectations with regard thereto or any change in events, conditions or circumstances on which any such statements are based unless required to do so by applicable law or the AIM Rules for Companies.
No statement in this Announcement is intended to be a profit forecast and no statement in this Announcement should be interpreted to mean that earnings or losses per share of the Company for the current or future financial years would necessarily match or exceed the historical published earnings or losses per share of the Company.
Arden, which is authorised and regulated by the FCA in the United Kingdom, is acting as sole Bookrunner and Broker to the Company in connection with the Placing. Cenkos Securities plc ("Cenkos"), which is authorised and regulated by the FCA in the United Kingdom, is acting as Nominated Adviser to the Company in connection with the Placing. Neither Arden nor Cenkos will be responsible to any person other than the Company for providing the protections afforded to their clients or for providing advice to any other person in connection with the Placing or any acquisition of shares in the Company. Neither Arden nor Cenkos is making any representation or warranty, express or implied, as to the contents of this Announcement. Neither Arden nor Cenkos has authorised the contents of, or any part of, this Announcement, and no liability whatsoever is accepted by Arden or Cenkos for the accuracy of any information or opinions contained in this Announcement or for the omission of any material information.
The Placing Shares will not be admitted to trading on any stock exchange other than the AIM market of the London Stock Exchange.
Information to Distributors
Solely for the purposes of the product governance of Chapter 3 of the FCA Handbook Product Intervention and Product Governance Sourcebook (the "UK Product Governance Requirements") and/or any equivalent requirements elsewhere to the extent determined to be applicable, and disclaiming all and any liability, whether arising in tort, contract or otherwise, which any "manufacturer" (for the purposes of the UK Product Governance Requirements and/or any equivalent requirements elsewhere to the extent determined to be applicable) may otherwise have with respect thereto, the Placing Shares have been subject to a product approval process, which has determined that the Placing Shares are: (i) compatible with an end target market of retail investors and investors who meet the criteria of professional clients and eligible counterparties, each as defined in Chapter 3 of the FCA Handbook Conduct of Business Sourcebook ("COBS"); and (ii) eligible for distribution through all permitted distribution channels (the "Target Market Assessment").
Notwithstanding the Target Market Assessment, Placees should note that: the price of the Placing Shares may decline and investors could lose all or part of their investment; Placing Shares offer no guaranteed income and no capital protection; and an investment in 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 Broker 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 COBS; 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.
APPENDIX II - TERMS AND CONDITIONS OF THE PLACING
IMPORTANT INFORMATION FOR INVITED PLACEES ONLY REGARDING THE PROPOSED PLACING OF NEW ORDINARY SHARES (THE "PLACING SHARES") IN THE CAPITAL OF ECHO ENERGY PLC (THE "COMPANY")
MEMBERS OF THE PUBLIC ARE NOT ELIGIBLE TO TAKE PART IN THE PLACING. THIS ANNOUNCEMENT (INCLUDING THE APPENDICES) AND THE TERMS AND CONDITIONS SET OUT HEREIN (TOGETHER, THIS "ANNOUNCEMENT") 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: (1) 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"); (2) IF IN THE UNITED KINGDOM, QUALIFIED INVESTORS WHO FALL WITHIN THE MEANING OF ARTICLE 2(E) OF THE UK VERSION OF THE EU PROSPECTUS REGULATION AS IT FORMS PART OF DOMESTIC LAW PURSUANT TO THE EUROPEAN UNION WITHDRAWAL ACT 2018 (THE "UK PROSPECTUS REGULATION") AND WHO (A) FALL WITHIN ARTICLE 19(5) OF THE FINANCIAL SERVICES AND MARKETS ACT 2000 (FINANCIAL PROMOTION) ORDER 2005, AS AMENDED (THE "ORDER") (INVESTMENT PROFESSIONALS) OR (B) FALL WITHIN ARTICLE 49(2)(A) TO (D) (HIGH NET WORTH COMPANIES, UNINCORPORATED ASSOCIATIONS, ETC.) OF THE ORDER; OR (3) OTHERWISE, ARE PERSONS TO WHOM IT IS LAWFUL TO COMMUNICATE IT (ALL SUCH PERSONS TOGETHER BEING REFERRED TO AS "RELEVANT PERSONS").
THIS ANNOUNCEMENT AND THE INFORMATION IN IT MUST NOT BE ACTED ON OR RELIED ON BY PERSONS WHO ARE NOT RELEVANT PERSONS. PERSONS DISTRIBUTING THIS ANNOUNCEMENT MUST SATISFY THEMSELVES THAT IT IS LAWFUL TO DO SO. ANY INVESTMENT OR INVESTMENT ACTIVITY TO WHICH THIS ANNOUNCEMENT RELATES IS AVAILABLE ONLY TO RELEVANT PERSONS AND WILL BE ENGAGED IN ONLY WITH RELEVANT PERSONS. THIS ANNOUNCEMENT DOES NOT ITSELF CONSTITUTE AN OFFER FOR SALE OR SUBSCRIPTION OF ANY SECURITIES IN THE COMPANY.
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 WITH ANY SECURITIES REGULATORY AUTHORITY OF ANY STATE OR JURISDICTION OF THE UNITED STATES, AND MAY NOT BE OFFERED, SOLD OR 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.
THIS ANNOUNCEMENT (INCLUDING THE APPENDICES) AND THE INFORMATION CONTAINED HEREIN IS RESTRICTED AND IS 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.
THIS ANNOUNCEMENT IS NOT FOR PUBLICATION OR DISTRIBUTION, DIRECTLY OR INDIRECTLY, IN OR INTO THE UNITED STATES OF AMERICA. THIS ANNOUNCEMENT IS NOT AN OFFER OF SECURITIES FOR SALE OR SUBSCRIPTION INTO THE UNITED STATES. THE SECURITIES REFERRED TO HEREIN HAVE NOT BEEN AND WILL NOT BE REGISTERED UNDER THE SECURITIES ACT AND MAY NOT BE OFFERED OR SOLD IN THE UNITED STATES, EXCEPT PURSUANT TO AN APPLICABLE EXEMPTION FROM REGISTRATION. NO PUBLIC OFFERING IS BEING MADE IN THE UNITED STATES.
The distribution of this Announcement 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, Arden Partners Plc (the "Bookrunner") or any of or any of their respective affiliates, agents directors, officers or employees ("Representatives") that would permit an offer of the Placing Shares or possession or distribution of this Announcement 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 this Announcement comes are required by the Company and the Bookrunner to inform themselves about and to observe any such restrictions.
This Announcement or any part of it is for information purposes only and does 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 (including its territories and possessions, any state of the United States and the District of Columbia), 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.
All offers of the Placing Shares: (i) in the EEA will be made pursuant to an exemption under the EU Prospectus Regulation; and (ii) in the UK will be made pursuant to an exemption under the UK Prospectus Regulation, from the requirement to produce a prospectus.
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 this Announcement. 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 from 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 offered in compliance with the securities laws of any state, province or territory of the United States, Australia, New Zealand, Canada, 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 the United States, Australia, Canada, the Republic of South Africa or Japan or any other jurisdiction outside the United Kingdom.
Persons (including, without limitation, nominees and trustees) who have a contractual right or other legal obligations to forward a copy of this Announcement should seek appropriate advice before taking any such action.
This Announcement should be read in its entirety. In particular, you should read and understand the information provided in the "Important Information" section at the start of this Announcement.
By participating in the accelerated bookbuilding process (the "Bookbuilding Process") and the Placing, each Placee will be deemed to have read and understood this Announcement in its entirety, to be participating, making an offer and acquiring Placing Shares on the terms and conditions contained herein and to be providing the representations, warranties, indemnities, acknowledgements and undertakings contained in this document.
UK Product Governance Requirements
Solely for the purposes of the product governance requirements of Chapter 3 of the FCA Handbook Product Intervention and Product Governance Sourcebook (the "UK Product Governance Requirements") and disclaiming all and any liability, whether arising in tort, contract or otherwise, which any "manufacturer" (for the purposes of the UK 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 UK Product Governance Requirements; and (ii) eligible for distribution through all distribution channels as are permitted by UK Product Governance Requirements (the "UK Target Market Assessment").
Notwithstanding the UK 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 UK 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 UK Target Market Assessment, the Bookrunner is only procuring investors in the United Kingdom which meet the criteria of professional clients and eligible counterparties.
For the avoidance of doubt, the UK Target Market Assessment does not constitute: (a) an assessment of suitability or appropriateness for the purposes of Chapter 9A or 10A respectively of the FCA Handbook Conduct of Business Sourcebook; 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.
EU Product Governance Requirements
Solely for the purposes of the product governance requirements contained within: (a) EU Directive 2014/65/EU on markets in financial instruments, as amended ("MiFID II"); (b) Articles 9 and 10 of Commission Delegated Directive (EU) 2017/593 supplementing MiFID II; and (c) local implementing measures (together, the "EU Product Governance Requirements"), and disclaiming all and any liability, whether arising in tort, contract or otherwise, which any "manufacturer" (for the purposes of the EU Product Governance Requirements) may otherwise have with respect thereto, the Placing Shares have been subject to a product approval process, which has determined that such securities are: (i) compatible with an end target market of retail investors and investors who meet the criteria of professional clients and eligible counterparties, each as defined in MiFID II; and (ii) eligible for distribution through all distribution channels as are permitted by MiFID II (the "EU Target Market Assessment").
Notwithstanding the EU 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 EU 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 EU Target Market, Assessment, the Bookrunner is only procuring investors in the European Union who meet the criteria of professional clients and eligible counterparties.
For the avoidance of doubt, the EU Target Market Assessment does not constitute: (a) an assessment of suitability of appropriateness for the purposes of MiFID II; or (b) a recommendation to any investor or group of investors to invest in, or purchase, or take any other action whatsoever with respect to the Placing Shares. Each distributor is responsible for undertaking its own target market assessment in respect of the Placing Shares and determining appropriate distribution channels.
EACH PLACEE SHOULD CONSULT WITH ITS OWN ADVISERS AS TO LEGAL, REGULATORY, TAX, BUSINESS AND RELATED ASPECTS OF A SUBSCRIPTION FOR THE PLACING SHARES.
In particular, each such Placee represents, warrants, undertakes, agrees and acknowledges (amongst other things) to the Bookrunner and the Company that:
1. it is a Relevant Person and undertakes that it will acquire, hold, manage or dispose of any Placing Shares that are allocated to it for the purposes of its business;
2. in the case of a Relevant Person in a member state of the EEA or the United Kingdom (each a " Relevant State ") who acquires any Placing Shares pursuant to the Placing:
(a) it is a Relevant Person (as defined above); and
(b) in the case of any Placing Shares acquired by it as a financial intermediary, as that term is used in the EU Prospectus Regulation or the UK Prospectus Regulation (as applicable):
(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 in circumstances in which the prior consent of the Bookrunner 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 (as defined in EU Prospectus Regulation or the UK Prospectus Regulation), the offer of those Placing Shares to it is not treated under the EU Prospectus Regulation or the UK Prospectus Regulation (as applicable) as having been made to such persons; and
3. it is acquiring the Placing Shares for its own account or is acquiring the Placing Shares for an account with respect to which it exercises sole investment discretion and has the authority to make and does make the representations, warranties, indemnities, acknowledgements, undertakings and agreements contained in this Announcement; and
4. it understands (or if acting for the account of another person, such person has confirmed that such person understands) the resale and transfer restrictions set out in this document; and
5. 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 of the United States and is acquiring the Placing Shares in offshore transactions as defined in and in accordance with Regulation S under the Securities Act; and
6. the Company and the Bookrunner will rely upon the truth and accuracy of the foregoing representations, warranties, acknowledgements and agreements.
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 Financial Conduct Authority (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 this 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 this Announcement (the "Publicly Available Information") and subject to any further terms set out in the contract note or electronic trade confirmation to be sent to individual Placees.
Each Placee, by participating in the Placing, agrees that the content of this 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 Bookrunner or the Company or any other person and none of the Bookrunner, the Company nor any other person acting on such person's behalf nor any of their respective Representatives 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 this Announcement to be legal, tax or business advice. Nothing in this paragraph shall exclude the liability of any person for fraudulent misrepresentation.
Details of the Placing Agreement and the Placing Shares
The Bookrunner has today entered into a placing agreement (the "Placing Agreement") with the Company under which, on the terms and subject to the conditions set out in the Placing Agreement, whereby amongst other things, the Bookrunner, as agent for and on behalf of the Company, has agreed to use its reasonable endeavours to procure Placees for the Placing Shares. The Placing is not being underwritten.
The Placing Shares will, when issued, be subject to the memorandum and articles of association of the Company, be credited as fully paid and will rank pari passu in all respects with the existing issued ordinary shares of £0.0025 each ("Ordinary Shares") in the capital of the Company, 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.
The maximum number of Placing Shares that may be issued pursuant to the Placing is accordingly 290,498,000.
Application for admission to trading
An application will be made to the London Stock Exchange for admission of the Placing Shares to trading on AIM. It is expected that the issue and admission of the Placing Shares will take place on or before 8.00 a.m. on 29 August 2022 ("Placing ShareAdmission") and that dealings in the Placing Shares on AIM will commence at the same time.
Warrants
Each Placee will be granted 1.07 warrants for every one Placing Share subscribed for. No fractional part of a Warrant will be issued and fractional entitlements will be rounded down to the nearest whole number. Each Warrant gives the holder the right to subscribe for one new Ordinary Share at a price of 0.25 pence per Ordinary Share for a period of two years from the date of issue. The Warrants will be unlisted, non-transferable and issued in certificated form.
The grant of the Warrants will be conditional upon the passing of resolutions to be put to shareholders of the Company at a general meeting of the Company to provide authority to the Directors to issue and allot further new Ordinary Shares (or grant rights over such shares) for cash on a non-pre-emptive basis. A circular containing a notice of the GM will be posted to shareholders shortly.
The Bookbuilding Process
The Bookrunner will commence the Bookbuilding Process to determine demand for participation in the Placing by Placees immediately following the publication of this Announcement. This document gives details of the terms and conditions of, and the mechanics of participation in, the Placing. In accordance with the requirements of the Companies Act 2006 and the Company's articles of association, the Company is permitted to pay commissions to Placees in respect of any Placing Shares subscribed.
The Bookrunner and the Company shall be entitled to effect the Placing by such alternative method to the Bookbuilding Process as it may, in its sole discretion, determine.
Principal terms of the Bookbuilding Process and Placing
1. The Bookrunner is acting as agent for and on behalf of the Company for the purposes of the Placing.
2. Participation in the Placing will only be available to persons who may lawfully be, and are, invited by the Bookrunner to participate. The Bookrunner and any of its affiliates are entitled to enter bids in the Bookbuilding Process.
3. The price per New Ordinary Share (the " Placing Price ") is fixed at 0.25 pence and is payable to the Bookrunner (as agent for the Company) by all Placees whose bids are successful.
4. The number of Placing Shares will be agreed between the Bookrunner and the Company following completion of the Bookbuilding Process for the Placing. The number of Placing Shares will be announced by the Company (the " Placing Results Announcement ") following the completion of the Bookbuilding Process for the Placing and the entry into the Placing Agreement by the Company and the Bookrunner.
5. To bid in the Bookbuilding Process for the Placing, Placees should communicate their bid by telephone or email to their usual sales contact at the Bookrunner. Each bid should state the number of Placing Shares which a Placee wishes to acquire at the Placing Price. Bids may be scaled down by the Bookrunner at its absolute discretoin. The Bookrunner is arranging the Placing as agent of the Company.
6. The Bookbuilding Process for the Placing is expected to close no later than 7 a.m. on 15 August 2022 but may be closed earlier or later subject to the agreement of the Bookrunner and the Company. The Bookrunner may, in agreement with the Company, accept bids that are received after the Bookbuilding Process for the Placing has closed. The Company reserves the right (upon agreement of the Bookrunner) to reduce or seek to increase the amount to be raised pursuant to the Placing, in its discretion.
7. Each Placee's allocation will be determined by the Bookrunner in its discretion following consultation with the Company and will be confirmed to Placees either orally or by email by the Bookrunner. The Bookrunner may choose to accept bids, either in whole or in part, on the basis of allocations determined at its absolute discretion, in consultation with the Company, and may scale down any bids for this purpose at its discretion.
8. The Company will release the Placing Results Announcement following the close of the Bookbuilding Process for the Placing detailing the aggregate number of the Placing Shares to be issued.
9. Each Placee's allocation and commitment will be evidenced by a contract note or electronic trade confirmation issued to such Placee by the Bookrunner. The terms of this document will be deemed incorporated in that contract note or electronic trade confirmation.
10. Subject to paragraphs 5 -9 above, the Bookrunner may choose to accept bids, either in whole or in part, on the basis of allocations determined at its discretion and may scale down any bids for this purpose on such basis as it may determine or be directed. The Bookrunner may also, notwithstanding paragraphs 5 -9 above, subject to the prior consent of the Company:
(a) allocate Placing Shares after the time of any initial allocation to any person submitting a bid after that time; and
(b) allocate Placing Shares after the Bookbuilding Process has closed to any person submitting a bid after that time.
11. Each Placee's allocation and commitment to acquire Placing Shares will be made on the terms and subject to the conditions in this document and will be legally binding on the Placee on behalf of which it is made and except with the Bookrunner's consent will not be capable of variation or revocation after the time at which it is submitted. Each Placee will have an immediate, separate, irrevocable and binding obligation, owed to the 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 Placing Price and the number of Placing Shares such Placee has agreed to acquire and the Company has agreed to allot and issue to that Placee.
12. Except as required by law or regulation, no press release or other announcement will be made by the Bookrunner 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.
13. 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 on the basis explained below under "Registration and Settlement".
14. All obligations under the Bookbuilding Process and 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".
15. By participating in the Bookbuilding Process, each Placee will agree 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.
16. To the fullest extent permissible by law and applicable FCA rules, neither:
(a) the Bookrunner;
(b) any of its affiliates, agents, directors, officers, consultants, partners or employees; nor
(c) to the extent not contained within (a) or (b), any person connected with the Bookrunner as defined in the FSMA ((b) and (c) being together "affiliates" and individually an "affiliate" of the 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 the Bookrunner nor any of its affiliates shall have any liability (including, to the extent permissible by law, any fiduciary duties) in respect of the Bookrunner's conduct of the Bookbuilding Process or of such alternative method of effecting the Placing as the Bookrunner and the Company may agree.
Registration and Settlement
If Placees are allocated any Placing Shares in the Placing they will be sent a contract note or electronic trade confirmation which will confirm the number of Placing Shares allocated to them, the Placing Price and the aggregate amount owed by them to the Bookrunner.
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 Bookrunner in accordance with either the standing CREST or certificated settlement instructions which they have in place with the Bookrunner.
Settlement of transactions in the Placing Shares (ISIN: GB00BF0YPG76) following Admission will take place within the CREST system, subject to certain exceptions. Settlement through CREST will be on a T+10 basis unless otherwise notified by the Bookrunner. Settlement of the Placing Shares is expected to occur on 29 August 2022 in accordance with the contract notes or electronic trade confirmations. Settlement will be on a delivery versus payment basis. However, in the event of any difficulties or delays in the admission of the Placing Shares to CREST or the use of CREST in relation to the Placing, the Company and the Bookrunner may agree that the Placing Shares should be issued in certificated form. The Bookrunner reserves the right to require settlement for the Placing Shares, and to deliver the Placing Shares to Placees, by such other means as it deems necessary if delivery or settlement to Placees 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 the due date in accordance with the arrangements set out above, in respect of either CREST or certificated deliveries, at the rate of 2 percentage points above the prevailing LIBOR as determined by the Bookrunner.
Each Placee is deemed to agree that, if it does not comply with these obligations, the Bookrunner may sell any or all of the Placing Shares allocated to that Placee on their behalf and retain from the proceeds, for the 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 Placing Price and for any stamp duty or stamp duty reserve tax (together with any interest or penalties) imposed in any jurisdiction which may arise upon the sale of such Placing Shares on its behalf. By communicating a bid for Placing Shares, such Placee confers on the Bookrunner all such authorities and powers necessary to carry out such sale and agrees to ratify and confirm all actions which the Bookrunner lawfully takes in pursuance of such sale.
If Placing Shares are to be delivered to a custodian or settlement agent, Placees must ensure that, upon receipt, the conditional contract note or the electronic 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. If there are any circumstances in which any United Kingdom stamp duty or stamp duty reserve tax or other similar taxes or duties (including any interest and penalties relating thereto) is payable in respect of the allocation, allotment, issue, sale, transfer or delivery of the Placing Shares (or, for the avoidance of doubt, if any stamp duty or stamp duty reserve tax is payable in connection with any subsequent transfer or agreement to transfer Placing Shares), the Company shall not be responsible for payment thereof.
Conditions of the Placing
The Placing is conditional upon the Placing Agreement becoming unconditional and not having been terminated in accordance with its terms.
The obligations of the Bookrunner under the Placing Agreement in respect of the Placing are conditional upon, inter alia:
(a) none of the warranties (the "Warranties") being untrue or inaccurate or misleading in any respect which is material in the context of the Placing at any time between the date of the Placing Agreement and Placing Share Admission and no fact or circumstance having arisen which would render any of the Warranties untrue or inaccurate or misleading
(b) Placing Share Admission taking place no later than 8.00 a.m. on 29 August 2022.
All of the conditions to the obligations of the Bookrunner included in the Placing Agreement being together, the "conditions").
If any of the conditions are not fulfilled or, where permitted, waived by the Bookrunner in accordance with the Placing Agreement within the stated time periods (or such later time and/or date as the Company and the Bookrunner may agree), or the Placing Agreement is terminated in accordance with its terms, then to the extent that Admission has not occurred (as applicable), the Placing 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 Bookbuilding Process, 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 Bookrunner may, in its absolute discretion and on such terms as it considers appropriate, waive fulfilment of all or any of the conditions in whole or in part, save that certain conditions may not be waived.
The Bookrunner or the Company may terminate the Placing Agreement in certain circumstances, details of which are set out below.
Neither the Bookrunner nor any of its affiliates 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 nor for any decision any of them may make as to the satisfaction of any condition or in respect of the Placing generally and by participating in the Placing each Placee agrees that any such decision is within the absolute discretion of the Bookrunner.
Termination of the Placing
The Bookrunner and/or the Company may, in their absolute discretion, by notice to the Company, terminate the Placing Agreement at any time up to Admission if, inter alia:
(a) they become aware of any circumstance which has resulted in a material breach of any of the Warranties when given at the date of the Placing Agreement or which results in or might result in a breach of any of the Warranties when deemed given;
(b) any material adverse change in the financial or trading position or prospects of the Company has or will occur;
(c) an event or other matter has occurred or is likely to occur which, in the good faith opinion of the Bookrunner and / or the Company, is (or will be if it occurs) likely materially and prejudicially to affect the financial position or the business or prospects of the Company or otherwise makes it impractical or inadvisable for the Bookrunner and / or the Company to perform their respective obligations under the Placing Agreement; or
(d) any other occurrence of any kind which (by itself or together with any other such occurrence) in the Bookrunner's reasonable opinion (or as the case may be the Company) is likely to materially and adversely affect the market's position or prospects of the Group taken as a whole'
and any such circumstances, change, matter or occurrence is material in the context of the Placing.
If the Placing Agreement is terminated in accordance with its terms, to the extent that Admission has not occurred (as applicable), the rights and obligations of each Placee in respect of the Placing as described in this Announcement shall cease and terminate at such time and no claim can be made by any Placee in respect thereof.
By participating in the Bookbuilding Process, each Placee agrees with the Company and the Bookrunner that the exercise by the Company or the Bookrunner 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 Bookrunner or for agreement between the Company and the Bookrunner (as the case may be) and that neither the Company nor the Bookrunner need make any reference to such Placee and that none of the Company, the Bookrunner nor any of their respective Representatives 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. Each Placee further agrees that they will have no rights against the Bookrunner, the Company or any of their respective directors or employees under the Placing Agreement pursuant to the Contracts (Rights of Third Parties) Act 1999 (as amended).
By participating in the Placing, each Placee agrees that its rights and obligations 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 after the issue by the Bookrunner of a contract note or electronic trade confirmation confirming each Placee's allocation and commitment in the Placing.
Representations, warranties and further terms
By submitting a bid in the Bookbuilding Process, each Placee (and any person acting on such Placee's behalf) irrevocably confirms, represents, warrants, acknowledges and agrees (for itself and for any such prospective Placee) with the Company and the Bookrunner that (save where the Bookrunner expressly agrees in writing to the contrary):
1. it has read and understood this Announcement in its entirety and that its acquisition of the 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 that 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 each Admission, the Placing, the Company, the Placing Shares or otherwise, other than the information contained in this Announcement and the Publicly Available Information;
2. it has not received and will not receive a prospectus or other offering document in connection with the Placing and acknowledges that no prospectus or other offering document:
(a) is required under the EU Prospectus Regulation, UK Prospectus Regulation or other applicable law; and
(b) has been or will be prepared in connection with the Placing;
3. the Company's 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 for the Companies (the " AIM Rules ") and the Market Abuse Regulation (EU Regulation No. 596/2014 as it forms part of domestic law pursuant to the European Union Withdrawal Act 2018 (" MAR ")), which includes a description of the nature of the Company's business and the Company's most recent balance sheet and profit and loss account 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 or other position of the Company in accepting a participation in the Placing and neither the Bookrunner nor the Company nor any of their respective Representatives 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 this Announcement or the Publicly Available Information; nor has it requested the Bookrunner, the Company, any of their respective Representatives or any person acting on behalf of any of them to provide it with any such information;
5. neither the Bookrunner nor any person acting on behalf of it nor any of its Representatives has or shall have any liability for any Publicly Available Information, or any representation relating to the Company, provided that nothing in this paragraph 5 excludes the liability of any person for fraudulent misrepresentation made by that person;
(a) the only information on which it is entitled to rely and on which it has relied in committing to acquire the Placing Shares is contained in this 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 information in this Announcement and the Publicly Available Information;
(b) neither the Bookrunner, nor the Company (nor any of their respective Representatives) 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 Publicly Available Information, nor will it provide any material or information regarding the Company, the Placing or the Placing Shares;
(c) it has conducted its own investigation of the Company, the Placing (including its terms and conditions) 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; and
(d) it has not relied on any investigation that the Bookrunner or any person acting on its behalf may have conducted with respect to the Company, the Placing or the Placing Shares;
6. the content of this Announcement and the Publicly Available Information has been prepared by and is exclusively the responsibility of the Company and that neither the Bookrunner nor any persons acting on its behalf is responsible for or has or shall have any liability for any information, representation, warranty or statement relating to the Company contained in this Announcement or the Publicly Available Information nor will they be liable for any Placee's decision to participate in the Placing based on any information, representation, warranty or statement contained in this Announcement, the Publicly Available Information or otherwise. Nothing in this document shall exclude any liability of any person for fraudulent misrepresentation;
7. neither it nor the beneficial owner of the Placing Shares is, nor will, at the time the Placing Shares are acquired, be a resident of the United States, Australia, New Zealand, Canada, the Republic of South Africa or Japan;
8. the Placing Shares have not been registered or otherwise qualified, and will not be registered or otherwise qualified, for offer and sale nor will a prospectus be cleared or approved in respect of any of the Placing Shares under the securities laws of the United States, or any state or other jurisdiction of the United States, Australia, New Zealand, Canada, the Republic of South Africa or Japan and, subject to certain exceptions, may not be offered, sold, taken up, renounced or delivered or transferred, directly or indirectly, within the United States, Australia, New Zealand, Canada, the Republic of South Africa or Japan or in any country or jurisdiction where any such action for that purpose is required;
9. it may be asked to disclose in writing or orally to the Bookrunner: (i) if he or she is an individual, his or her nationality; or (ii) if he or she is a discretionary fund manager, the jurisdiction in which the funds are managed or owned;
10. it has the funds available to pay for the Placing Shares for which it has agreed to acquire and acknowledges and agrees that it will pay the total subscription amount in accordance with the terms of this Announcement on 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 Bookrunner determines;
11. 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 this document) 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;
12. 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;
13. 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;
14. it (and any account for which it is purchasing) is not acquiring the New Ordinary Shares with a view to any offer, sale or distribution thereof within the meaning of the Securities Act;
15. it will not distribute, forward, transfer or otherwise transmit this Announcement or any part of it, 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;
16. none of the Bookrunner, the Company nor any of their respective Representatives nor 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 the Bookrunner and that the Bookrunner has 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;
17. it will make payment to the Bookrunner for the Placing Shares allocated to it in accordance with the terms and conditions of this Announcement on the due times and dates set out in this Announcement, failing which the relevant Placing Shares may be placed with others on such terms as the 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 this Announcement) which may arise upon the sale of such Placee's Placing Shares on its behalf;
18. its allocation (if any) of Placing Shares will represent a maximum number of Placing Shares which it will be entitled, and required, to subscribe for, and that the Company 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;
19. no action has been or will be taken by any of the Company, the Bookrunner or any person acting on behalf of the Company or the Bookrunner 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;
20. 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,
and that the Bookrunner and the Company will not be responsible for any liability to stamp duty or stamp duty reserve tax resulting from a failure to observe this 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 Bookrunner in respect of the same on the basis that the Placing Shares will be allotted to a CREST stock account of the Bookrunner or transferred to a CREST stock account of the Bookrunner who will hold them as nominee on behalf of the Placee until settlement in accordance with its standing settlement instructions with it;
21. the allocation, allotment, issue and delivery to it, or the person specified by it for registration as holder, of Placing Shares will not give rise to a stamp duty or stamp duty reserve tax liability under (or at a rate determined under) any of sections 67, 70, 93 or 96 of the Finance Act 1986 (depository receipts and clearance services) and that it is not participating in the Placing as nominee or agent for any person or persons to whom the allocation, allotment, issue or delivery of Placing Shares would give rise to such a liability;
22. if it is within the United Kingdom, it and any person acting on its behalf (if within the United Kingdom) falls within Article 19(5) and/or 49(2) of the Order and undertakes that it will acquire, hold, manage and (if applicable) dispose of any Placing Shares that are allocated to it for the purposes of its business only;
23. it has not offered or sold and will not offer or sell any Placing Shares to persons in a Relevant State prior to the expiry of a period of six months from each Admission except to persons whose ordinary activities involve them in acquiring, holding, managing or disposing of investments (as principal or agent) for the purposes of their business or otherwise in circumstances which have not resulted and which will not result in an offer to the public in the United Kingdom within the meaning of section 85(1) of the FSMA or an offer to the public in any member state of the EEA within the meaning of the EU Prospectus Regulation;
24. if it is within a Relevant State, it is a Qualified Investor as defined in the EU Prospectus Regulation or the UK Prospectus Regulation (as applicable);
25. 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 this Announcement has not been approved by the Bookrunner in its capacity as an authorised person under section 21 of the FSMA and it may not therefore be subject to the controls which would apply if it was made or approved as financial promotion by an authorised person;
26. it has complied and it will comply with all applicable laws 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 the MAR in respect of anything done in, from or otherwise involving the United Kingdom);
27. if it is a financial intermediary, as that term is used in the EU Prospectus Regulation or the UK Prospectus Regulation (as applicable), 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, persons in a Relevant State other than Qualified Investors, or in circumstances in which the express prior written consent of the Bookrunner has been given to each proposed offer or resale;
28. if it has received any inside information (for the purposes of MAR and 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 or cancelled or amended a dealing in the securities of the Company;
(b) encouraged, recommended or induced another person to deal in the securities of the Company or to cancel or amend an order concerning the Company's securities; or
(c) unlawfully disclosed such information to any person, prior to the information being made publicly available;
29. the Bookrunner and its affiliates, acting as an investor for its or their own account(s), may bid or subscribe for and/or purchase Placing Shares and, in that capacity, may retain, purchase, offer to sell or otherwise deal for its or their own account(s) in the Placing Shares, any other securities of the Company or other related investments in connection with the Placing or otherwise. Accordingly, references in this 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 Bookrunner and/or any of its affiliates acting as an investor for its or their own account(s). Neither the Bookrunner 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;
30. it:
(a) has complied with its obligations in connection with money laundering and terrorist financing under the Proceeds of Crime Act 2002 (as amended), the Terrorism Act 2000 (as amended), the Terrorism Act 2006, the Money Laundering, Terrorist Financing and Transfer of Funds (Information on the Payer) Regulations 2017 (as amended) and all related or similar rules, regulations or guidelines, issued, administered or enforced by any government agency having jurisdiction in respect thereof and the Money Laundering Sourcebook of the FCA (together, the "Money Laundering Regulations");
(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,
(together with the Money Laundering Regulations, 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 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 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 Bookrunner may decide at its sole discretion;
31. in order to ensure compliance with the Regulations, the 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 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 Bookrunner's absolute discretion or, where appropriate, delivery of the Placing Shares to it in uncertificated form may be delayed at the 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 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 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;
32. it acknowledges that its commitment to acquire Placing Shares on the terms set out in this Announcement and in the contract note or through the electronic trade confirmation 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 the Bookrunner's conduct of the Placing;
33. it has knowledge and experience in financial, business and international investment matters as is required to evaluate the merits and risks of acquiring the Placing Shares. It further acknowledges that it is experienced in investing in securities of this nature and is aware that it may be required to bear, and is able to bear, the economic risk of, and is able to sustain, a complete loss in connection with the Placing. It has relied upon its own examination and due diligence of the Company and its affiliates taken as a whole, and the terms of the Placing, including the merits and risks involved;
34. it irrevocably appoints any duly authorised officer of the 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 the terms of this Announcement;
35. the Company, the Bookrunner and others (including each of their respective Representatives) will rely upon the truth and accuracy of the foregoing representations, warranties, acknowledgements and agreements, which are given to the Bookrunner on its own behalf and on behalf of the Company and are irrevocable;
36. it is acting as principal only in respect of the Placing or, if it is acquiring the Placing Shares as a fiduciary or agent for one or more investor accounts, it:
(a) 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; and
(b) will remain liable to the Company and the Bookrunner for the performance of all its obligations as a Placee in respect of the Placing (regardless of the fact that it is acting for another person);
37. time is of the essence as regards its obligations under this document;
38. any document that is to be sent to it in connection with the Placing will be sent at its risk and may be sent to it at any address provided by it to the Bookrunner;
39. the Placing Shares will be issued subject to the terms and conditions of this document; and
40. the terms and conditions contained in this document and all documents into which this document is 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 Bookbuilding Process and/or the Placing and all non-contractual or other obligations arising out of or in connection with them, 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 or matter arising out of such contract (including any dispute regarding the existence, validity or termination or such contract or relating to any non-contractual or other obligation 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 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 Bookrunner and each of their respective Representatives 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 this document or incurred by the Bookrunner, the Company or each of their respective Representatives arising from the performance of the Placee's obligations as set out in this Announcement, and further agrees that the provisions of this document shall survive after the completion of the Placing.
The rights and remedies of the Bookrunner and the Company under these terms and conditions are in addition to any rights and remedies which would otherwise be available to each of them and the exercise or partial exercise or partial exercise of one will not prevent the exercise of others.
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, directly 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 Bookrunner 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 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 Bookrunner in the event that either the Company and/or the Bookrunner have incurred any such liability to such taxes or duties.
The representations, warranties, acknowledgements and undertakings contained in this document are given to the Bookrunner for itself and on behalf of the Company and are irrevocable.
The Bookrunner is authorised and regulated by the FCA in the United Kingdom and is acting exclusively for the Company and no one else in connection with the Bookbuilding Process and the Placing, and the Bookrunner will not be responsible to anyone (including any Placees) other than the Company for providing the protections afforded to its clients or for providing advice in relation to the Bookbuilding Process or the Placing or any other matters referred to in this Announcement.
Each Placee and any person acting on behalf of the Placee acknowledges that the Bookrunner does not owe any fiduciary or other duties to any Placee in respect of any representations, warranties, undertakings, acknowledgements, agreements or indemnities in the Placing Agreement.
Each Placee and any person acting on behalf of the Placee acknowledges and agrees that the Bookrunner 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 the Bookrunner, any money held in an account with the Bookrunner 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 Bookrunner's money in accordance with the client money rules and will be held by it under a banking relationship and not as trustee.
References to time in this Announcement are to London time, unless otherwise stated.
All times and dates in this Announcement may be subject to amendment. Placees will be notified of any changes.
No statement in this Announcement is intended to be a profit forecast or estimate, and no statement in this Announcement should be interpreted to mean that earnings per share of the Company for the current or future financial years would necessarily match or exceed the historical published earnings per share of the Company.
The price of 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 shares. Past performance is no guide to future performance, and persons needing advice should consult an independent financial adviser.
The Placing Shares to be issued pursuant to the Placing will not be admitted to trading on any stock exchange other than the AIM market of the London Stock Exchange.
Neither the content of the Company's website nor any website accessible by hyperlinks on the Company's website is incorporated in, or forms part of, this Announcement.
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