Proposed equity fundraising via ABB
THIS ANNOUNCEMENT, INCLUDING THE APPENDICES AND THE INFORMATION CONTAINED HEREIN (TOGETHER THIS "ANNOUNCEMENT"), IS RESTRICTED AND IS NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, IN WHOLE OR IN PART, IN OR INTO THE UNITED STATES OF AMERICA, CANADA, AUSTRALIA, JAPAN, THE REPUBLIC OF SOUTH AFRICA OR ANY OTHER JURISDICTION IN WHICH SUCH RELEASE, PUBLICATION OR DISTRIBUTION WOULD BE UNLAWFUL. PLEASE SEE THE IMPORTANT NOTICES AT THE END OF THIS ANNOUNCEMENT.
THIS ANNOUNCEMENT SHOULD BE READ IN ITS ENTIRETY. IN PARTICULAR, YOU SHOULD READ AND UNDERSTAND THE INFORMATION PROVIDED IN APPENDIX I WHICH CONTAINS THE TERMS AND CONDITIONS OF THE PLACING.
THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION FOR THE PURPOSES OF THE MARKET ABUSE REGULATION (EU) 596 / 2014 WHICH FORMS PART OF UK 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.
24 June 2025
Zephyr Energy plc
("Zephyr" or the "Company")
Proposed fundraising to raise c.£10 million
Proposed US$7.3 million acquisition of a portfolio of well interests in the Rocky Mountain region
Zephyr Energy plc (AIM: ZPHR) (OTCQB: ZPHRF) announces its intention to conduct a fundraising to raise gross proceeds of around £10 million (which may be increased) through i) a placing of new ordinary shares ("Placing Shares") of 0.1p each in the capital of the Company ("Ordinary Shares") to new and existing investors ("Placees") at an issue price of 3.0 pence per new Ordinary Share (the "Issue Price") (the "Placing"); and ii) a proposed Director Subscription of up to £0.7 million.
The Placing is being made available to certain institutional and professional investors only and will be conducted by way of an accelerated bookbuild ("Bookbuild") which will open immediately following release of this Announcement in accordance with the terms and conditions set out in Appendix I.
Certain Directors, management and their affiliates intend to subscribe for new Ordinary Shares at the Issue Price to raise up to a further £0.7 million (before expenses) for the Company after publication of the Company's audited results for the year ended 31 December 2024 by 30 June 2025, subject to the passing of the Resolutions.
In addition, the Board of Zephyr is pleased to announce the proposed acquisition of a portfolio of working interests in accretive, mature production and development assets in core Rocky Mountain basins, U.S. (the "Proposed Acquisition"), which the Directors believe have attractive upside drilling potential.
Placing highlights:
· The net proceeds of the Placing and proposed Director Subscription, which are expected to amount to approximately £9.3 million (which may be increased) subject to the passing of the Resolutions will provide the Company with additional capital to fund:
(i) the cash consideration of US$7.3 million (c. £5.4 million) under the Proposed Acquisition; and
(ii) an estimated £3.9 million of incremental near-term capital expenditure ("CAPEX") and working capital associated with the Company's flagship project in the Paradox Basin, Utah, U.S. (the "Paradox project") to provide a path to first production.
Any additional net proceeds from the Placing and Director Subscription will be used to supplement the Company's working capital, to fund additional Paradox project CAPEX and/or to fund further acquisitions in connection with the Company's non-operated asset portfolio.
· Turner Pope Investments (TPI) Ltd ("Turner Pope") and Canaccord Genuity Limited ("Canaccord") are acting as Joint Brokers and joint bookrunners in respect of the Placing (together, the "Bookrunners") and Allenby Capital Limited ("Allenby Capital") is acting as Nominated Adviser to Zephyr. Auctus Advisors LLP is acting as a placing agent in respect of the Placing.
· The final number and allocation of the Placing Shares will be determined by the Bookrunners in consultation with the Company and the result of the Placing will be announced as soon as practical after the closing of the Bookbuild.
· Due to limits on the existing share authorities available to issue new Ordinary Shares, the Placing will be conducted in two tranches, as follows:
· a placing of 175,071,902 Placing Shares (the "First Placing Shares") at the Issue Price to be issued pursuant to the Company's existing authorities to issue and allot equity securities on a non-pre-emptive basis, granted at the annual general meeting of the Company on 31 July 2024, to raise approximately £5.3 million (the "First Placing"); and
· a conditional placing of a minimum of 134,928,098 Placing Shares (the "Second Placing Shares") at the Issue Price to be issued conditional on the passing of the Resolutions at the General Meeting (as described further below) expected to raise a minimum of £4.0 million (the "Second Placing").
· Certain Directors, management and their affiliates intend to subscribe for new Ordinary Shares at the Issue Price to raise up to a further £0.7 million (before expenses) for the Company after publication of the Company's audited results for the year ended 31 December 2024 by 30 June 2025, subject to the passing of the Resolutions.
Further details of the Placing and the background to and reasons for it are set out further below.
The terms and conditions of the Placing are set out in Appendix I at the end of this Announcement.
Proposed Acquisition highlights:
· The Proposed Acquisition offers the opportunity to add current, mature production of approximately 400 boepd net to Zephyr in the first three months following completion of the Proposed Acquisition, and a management estimate of 600,000 boe of 2P producing reserves to the Company's portfolio;
· The assets include working interests in a portfolio of over 400 wells, 21 of which will be operated by the Company. The non-operated wells are operated by companies that are active in the core Rocky Mountain basins, U.S.;
· Attractive near-term PUD upside (20,000+ acres), including organic drilling opportunities with 32 wells drilled in 2024 and 17 drilled but uncompleted wells ("DUCs") in the process of completion and production start-up;
· An additional 13 wells scheduled to be drilled in the near-term, with CAPEX potentially funded by Zephyr's strategic partner, a U.S.-based capital provider focused on the upstream energy sector;
· US$7.3 million (c. £5.4 million) purchase price to be settled in cash by Zephyr on completion, scheduled for the end of July 2025;
· Zephyr to receive US$650,000 asset retirement obligation ("ARO") liability coverage for 12 months;
· The Proposed Acquisition will further strengthen Zephyr's balance sheet and cash flow position, fortify Zephyr's position ahead of any partnership talks concerning the Paradox project, and provide new infill drilling opportunities which have the potential to be funded by Zephyr's strategic partner; and
· With an effective date of 1 June 2025, the Proposed Acquisition is expected by the Board to add operating income of US$4 million in the first twelve months (based on strip prices on 29 May 2025).
Further details of the Proposed Acquisition are set out further below.
This Announcement should be read in its entirety. Attention is drawn to the section of this Announcement headed 'Important Notices' and the terms and conditions of the Placing (representing important information for invited Placees only) in Appendix I to this Announcement. Definitions used in this Announcement are set out in Appendix II. Other technical terms used in this Announcement are defined in the Glossary in Appendix III to this Announcement.
Contacts:
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Zephyr Energy plc Colin Harrington (CEO) Chris Eadie (Group Finance Director and Company Secretary)
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Tel: +44 (0)20 7225 4590 |
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Allenby Capital Limited - AIM Nominated Adviser Jeremy Porter / Vivek Bhardwaj
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Tel: +44 (0)20 3328 5656
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Turner Pope Investments - Joint Broker James Pope / Andy Thacker
Canaccord Genuity Limited - Joint Broker Henry Fitzgerald-O'Connor / Charlie Hammond
Celicourt Communications - PR Mark Antelme / Ali AlQahtani |
Tel: +44 (0)20 3657 0050
Tel: +44 (0)20 7523 8000
Tel: +44 (0) 20 7770 6424 |
Notes to Editors
Zephyr Energy plc (AIM: ZPHR) (OTCQB: ZPHRF) is a technology-led oil and gas company focused on responsible resource development in the Rocky Mountain region of the United States. The Company's mission is rooted in two core values: to be responsible stewards of its investors' capital, and to be responsible stewards of the environment in which it works.
Zephyr's flagship asset is an operated 46,000-acre leaseholding located in the Paradox Basin, Utah. In addition to its operated assets, the Company owns working interests in a broad portfolio of non-operated producing wells across the Williston Basin in North Dakota and Montana. Cash flow from the Williston production will be used to fund the planned Paradox Basin development. In addition, the Board will consider further opportunistic value-accretive acquisitions.
This Announcement is made in accordance with the Company's obligations under Article 17 of UK MAR and the person responsible for arranging for the release of this Announcement on behalf of Zephyr is Colin Harrington, Chief Executive Officer.
FURTHER INFORMATION ON THE PLACING AND THE PROPOSED ACQUISITION
Background to and reasons for the Placing
Over the last five years the Company has grown through the implementation of a dual strategy focused on acquisitions and value creation via drilling activity:
· Acquisitions: Zephyr has built a low-risk, income-generating non-operated asset portfolio to drive long-term value and capital growth. To date, Zephyr has completed 14 acquisitions (not including the Proposed Acquisition) and has moved from zero production to approximately 1.5 million net boe produced from 2021 to 2024.
· Value creation via drilling activity: Zephyr is committed to reinvesting capital from its non-operated assets to advance the Paradox project - an underexplored basin where modern oil and gas technology has yet to be fully applied. In this respect, Zephyr has drilled three wells and demonstrated strong production test results, secured a large contiguous acreage position, and acquired critical data and infrastructure to support further development at the Paradox project.
The proposed Placing will provide a path to first production in the Paradox project. In addition, the Proposed Acquisition is anticipated to deliver accretive production growth as the Company seeks to deliver 3x production growth in the next 18 months. This is on the back of three key catalysts which fit in with the Company's stated dual strategy:
1. The successful production test on the State 36-2 LNW-CC-R well (the "well" or the "State 36-2R") at the Paradox project suggests that the well is in the top 6 per cent. of all gas wells across the Lower 48 (U.S. excluding Alaska and Hawaii), and the results demonstrate the potential for a new prolific onshore resource play with a P50 individual well performance of 3.6 million boe per well and a 284 per cent. internal rate of return ("IRR"). On a 20 well development programme in the Cane Creek reservoir alone, management estimates the potential for P50 gross recoverable resources of 72.5 million boe across Zephyr's current 25,000-acre 3D seismic position;
2. A US$100 million commitment from a major U.S.-based capital provider focused on the upstream energy sector to accelerate growth in Zephyr's non-operated asset portfolio; and
3. The Proposed Acquisition is expected to add current, mature production of approximately 400 boepd net to Zephyr in the first three months following completion of the Proposed Acquisition and a management estimate of 600,000 boe of 2P producing reserves to the Company's portfolio, with attractive and near-term PUD upside.
Zephyr will continue to seek to drive growth and create long-term value for all stakeholders through responsible oil and gas production and bolstering cash flows through accretive off-market acquisitions. This will provide the Company with a position of strength for any future farm-in, joint venture or sale discussions.
Paradox project
Zephyr has continued to make excellent progress in the development of the Paradox project, culminating in the recent successful production test on the State 36-2R well that exceeded management's expectations.
The test achieved a peak flow rate of 2,848 boe per day with no material drop in bottom hole pressure, and without the use of any fracture stimulation, which suggests that the well is in the top 6 per cent. of all gas wells across the Lower 48, further demonstrating the significant potential of the Paradox project.
The test results suggest that 10,000-foot lateral wells drilled at the Paradox project could achieve a P50 individual well performance of 3.6 million boe, an IRR of 284 per cent. and a PV-10 of US$25.2 million, affirming that the Cane Creek reservoir is a highly productive and valuable asset, on par with some of the leading oil and gas plays in the U.S. Management have also estimated gas initially in place ("GIIP") in the Cane Creek reservoir (under Zephyr's existing 3D seismic position) of 800-1000 billion cubic feet ("bcf").
In parallel, the Board will also be looking at opportunities to continue to expand the Paradox project through additional lease acquisitions, or by further delineating the additional reservoirs overlying the Cane Creek.
This is an exciting time in the evolution of the Paradox project, and the Board believes that the fundamental pieces are in place for Zephyr to drive the Paradox project forward to first gas and commercial production.
The next steps on the Paradox project include the following:
· third party CPR to be commissioned;
· target completion of gas marketing agreements and build out gas processing plant infrastructure;
· continue to engage with farm-in or strategic partners to help fund larger scale projects;
· continue to lease and/or acquire additional nearby acreage;
· potential to accelerate legacy workovers on existing 28-11 and 16-2 wells to bring online additional production at reduced cost; and
· test overlying reservoirs and continue to delineate/develop acreage (potentially using an existing vertical wellbore).
Zephyr's primary goal is to deliver production and returns from the Paradox project as quickly as possible. In addition to ongoing discussions with local pipeline and gas processing infrastructure partners, the Company has been approached by multiple parties, including compressed natural gas service companies and data centre / cryptocurrency mining operators expressing an interest in securing direct, near-term offtake agreements for gas produced by the Paradox project. The Company first considered these early production concepts in 2022 and, cognisant of today's backdrop, has seen significant renewed interest from third parties related to this approach. These gas sales alternatives would not require any CAPEX contribution from Zephyr but could provide for rapid deployment and a near-term gas sales solution, albeit for a portion of gas produced with the remainder ultimately sold via pipeline. Should a data centre / cryptocurrency mining venture come to fruition, the Board would consider the merits of the Company being paid in, and keeping in treasury, Bitcoin and, potentially, other mainstream cryptocurrencies.
Williston project
Over the last four years, Zephyr has built an experienced operations team (engineering, land, finance & accounting) and established a disciplined, data-driven process for asset evaluation. Leveraging a comprehensive asset database, the Zephyr team is well-positioned to efficiently appraise, acquire and manage high-return, non-operated assets in the core Rocky Mountain basins, U.S.
Consequently, Zephyr has built a growing and diverse base of non-operated producing assets in the Williston Basin, North Dakota and Montana, U.S. (the "Williston project") with low maintenance CAPEX, attractive free cash flow and potential future drilling upside.
The non-operated portfolio is currently made up of over 200 developed producing wells. In 2024, the wells produced 1,145 boepd with (unaudited) associated revenues of US$24.2 million, net to Zephyr, and net revenue interest average of 5.1 per cent, resulting in an adjusted EBITDA for the Company of US$10.9 million (unaudited).*
In May 2025, Zephyr announced a US$100 million strategic partnership with a major U.S.-based capital provider focused on the upstream energy sector. The combination of Zephyr's deep regional expertise and the partner's financial strength is designed to accelerate the Company's non-operated growth, enhance consolidated cashflow, and drive attractive project returns.
Under the terms of the partnership, the investor will provide up to US$100 million to be used to fund 100% of the CAPEX related to the drilling, completing and equipping of newly acquired assets. Zephyr will be responsible for any acquisition costs and will retain a right (but not an obligation) to co-fund up to 33% of pro rata CAPEX to maximise returns. Zephyr Hawk LLC, a subsidiary company of Zephyr, will be utilised as the acquisition vehicle for the purposes of the partnership.
The next steps on the Williston project include:
· generating new drilling opportunities from existing and newly acquired assets; and
· deploying the strategic partner funding as accretively and quickly as possible.
The Proposed Acquisition
Zephyr has signed a non-binding letter of intent for the acquisition of a portfolio of working interests in accretive, mature production and development assets in core Rocky Mountain basins in the U.S. for US$7.3 million cash (c. £5.4 million).
Under the terms of the Proposed Acquisition, Zephyr will acquire a portfolio of working interests in over 400 wells, 21 of which will be operated by the Company. The non-operated wells are operated by companies that are active in these regions. The acquired assets will add an estimated 600,000 boe of 2P producing reserves (management estimate) and approximately 400 boepd, net to Zephyr, of current mature production (85% oil and highly diversified production) in the first three months following completion of the Proposed Acquisition. Zephyr's working interests in the well portfolio are estimated to average less than 10 per cent., but this remains subject to verification in due diligence.
The Proposed Acquisition is expected to be accretive on an earnings and reserves basis and offers attractive upside potential:
· organic drilling opportunities with 32 wells drilled in 2024 and 17 current DUCs;
· an additional 13 wells scheduled to be drilled with CAPEX potentially funded by Zephyr's U.S. based strategic partner; and
· 20,000+ acre position with attractive near-term PUD potential.
The Proposed Acquisition had net operating income for 2024 of approximately US$3.77 million and is forecast to add net operating income to Zephyr of circa US$4 million over the next twelve months (based on strip prices on 29 May 2025).
The Proposed Acquisition offers strategic entry into key areas of interest and enhances Zephyr's competitive position within the core Rocky Mountain basins, U.S, alongside top tier operators such as EOG, Occidental, Devon, Chord, Continental and Kraken.
In addition, the Proposed Acquisition will further strengthen the Company's balance sheet and cash flow position, ahead of the next semi-annual debt redetermination of the US$15.15m revolver facility (expected to occur in July 2025), and fortify Zephyr ahead of planned partnership talks on the Paradox project as well as provide new infill drilling opportunities.
The non-binding letter of intent remains subject to completion of customary due diligence and other approvals. The non-binding letter of intent becomes binding upon completion of funding by Zephyr to satisfy the Proposed Acquisition consideration, which is expected to be procured from the Second Placing. Should the Second Placing complete, the Proposed Acquisition is expected to complete by the end of July 2025 with an effective date of 1 June 2025. Zephyr will receive US$650,000 of asset retirement obligation liability coverage for 12 months from completion.
Use of Placing proceeds
The gross proceeds of the Placing, which are expected to amount to approximately £5.3 million from the First Placing and at least £4.0 million from the Second Placing, as well as up to £0.7 million from the proposed Director Subscription (in aggregate, approximately £9.3 million net of expenses), will provide the Company with additional capital to finance:
(i) the cash consideration of US$7.3 million (c. £5.4 million) under the Proposed Acquisition of a diverse pool of accretive, producing assets in the core Rocky Mountain basins, U.S. with the potential to generate additional drilling activity funded by Zephyr's partner, a U.S.-based capital provider focused on the upstream energy sector; and
(ii) an estimated £3.9 million of incremental near-term CAPEX and working capital associated with the Paradox project to deliver a pathway to first gas, including well costs, well workovers, P&A costs, the commissioning of a new CPR, additional acreage leasing and near-term infrastructure, as well as gas processing CAPEX.
Any additional net proceeds from the Placing, including the Director Subscription (as defined below), will be used to supplement the Company's working capital, to fund additional Paradox project CAPEX and/or to fund further acquisitions in connection with the Company's non-operated asset portfolio.
Further details of the Placing
It is expected that the First Placing will result in the issue of 175,071,902 new Ordinary Shares at the Issue Price, to raise approximately £5.3 million before expenses for the Company. The Second Placing is expected to result in the issue of a minimum of 134,928,098 new Ordinary Shares at the Issue Price to raise a minimum of £4.0 million before expenses for the Company. The Placing Shares are expected to represent a minimum of 14.87 per cent. of the enlarged issued share capital of the Company after the Placing and minimum Director Subscription.
The Issue Price represents a discount of approximately 20 per cent. to the closing middle market price of 3.75 pence per Ordinary Share on 23 June 2025, being the latest practicable date prior to this Announcement.
Due to limits on the existing share authorities available to issue new Ordinary Shares, the Placing will be conducted in two tranches, as follows:
· the First Placing: a placing of the 175,071,902 First Placing Shares at the Issue Price to be issued pursuant to the Company's existing authorities to issue and allot equity securities on a non-pre-emptive basis, granted at the annual general meeting of the Company on 31 July 2024; and
· the Second Placing: a conditional placing of a minimum of 134,928,098 Second Placing Shares at the Issue Price to be issued conditional on the passing of the Resolutions at the General Meeting (as described further below).
Accordingly, if the Resolutions are not passed at the General Meeting, the net Placing proceeds will be allocated to the near-term CAPEX and working capital associated with the Paradox project and the balance will go towards part of the cash consideration for the Proposed Acquisition, although additional funding will need to be secured to proceed with the Proposed Acquisition on the current terms or the Company will seek to renegotiate the terms of the Proposed Acquisition with the vendor.
Pursuant to a placing agreement dated 24 June 2025 between Canaccord, Turner Pope and the Company (the "Placing Agreement"), Canaccord and Turner Pope have conditionally agreed, as agents on behalf of the Company, to use their respective reasonable endeavours to procure subscribers for the Placing Shares at the Issue Price. The Placing Agreement contains customary warranties, indemnities and undertakings from the Company in favour of Canaccord and Turner Pope. Under the terms of the Placing Agreement, each of Canaccord and Turner Pope will receive a corporate finance fee from the Company and commission relating to the Placing Shares.
Based on a Placing for at least £9.3 million, the Company also intends to issue warrants to subscribe for 20,000,000 new Ordinary Shares ("Fee Warrants") to the Bookrunners and agents to the Placing. The Fee Warrants are exercisable at the Issue Price for a period of five years from the date of Second Admission (as defined below). The Fee Warrants will not be admitted to trading on AIM or any other stock exchange.
The Placing is subject to the terms and conditions set out in Appendix I to this Announcement. The Bookrunners will commence the Bookbuild in respect of the Placing immediately following the release of this Announcement. The exact number of Placing Shares and Fee Warrants will be determined at the close of the Bookbuild and will be announced as soon as practicable thereafter.
The timing of the closing of the Bookbuild, the number of new Ordinary Shares to be issued pursuant to the Placing and allocations among subscribers are at the absolute discretion of the Bookrunners, in consultation with the Company. A further announcement confirming the final details of the Placing will be made following the closing of the Bookbuild. The Bookrunners reserve the right to close the Bookbuild without further notice. The Placing is being undertaken on a reasonable endeavours basis and is not being underwritten. Furthermore, the proposed issue of the new Ordinary Shares pursuant to the Placing will take place on a non-pre-emptive basis. The Second Placing is conditional on the approval of the Resolutions by Shareholders at the General Meeting (as described further below).
The new Ordinary Shares, when issued, will be credited as fully paid and will rank pari passu in all respects with each other and with the existing Ordinary Shares including, without limitation, the right to receive all dividends and other distributions declared, made or paid on or after the date of issue.
Director and management subscription
As the Company is currently in a close period pursuant to UK MAR until the publication of its audited results for the year ended 31 December 2024 (the "Results"), expected by 30 June 2025, the Directors and management of the Company are prohibited from acquiring shares in the Placing at this time. However, certain of the Directors, management and their affiliates have confirmed that following the publication of the Results by 30 June 2025, that they intend to subscribe for new Ordinary Shares at the Issue Price to raise a further up to £0.7 million (before expenses) for the Company (and such amount may be increased), which is expected to complete alongside the Second Placing subject to the passing of the Resolutions (the "Director Subscription").
General Meeting
The Second Placing is conditional upon, amongst other things, shareholders of the Company ("Shareholders") approving the passing of resolutions to (i) authorise such issues and allotments of new Ordinary Shares and (ii) disapply pre-emption rights to the extent necessary to authorise such issues and allotments of new Ordinary Shares on a non-pre-emptive basis (the "Resolutions"), to be put to shareholders at a general meeting of the Company expected to be held on 14 July 2025 (the "General Meeting"). Such Resolutions will, if passed, grant to the Directors the authority to allot the Second Placing Shares for cash on a non-pre-emptive basis.
The General Meeting is proposed to be held at the offices of Haynes and Boone CDG LLP, 1 New Fetter Lane, London, EC4A 1AN, United Kingdom at 10.00 a.m. on 14 July 2025 and the Company intends to publish and send a circular, which will include a notice convening the General Meeting, to Shareholders as soon as practicable following the closing of the Bookbuild.
The First Placing is conditional upon, amongst other things, the Placing Agreement not having been terminated in accordance with its terms and First Admission (as described below) becoming effective.
The First Placing is not conditional on the passing of the Resolutions or the completion of the Second Placing. Should the Resolutions not be passed at the General Meeting, the Second Placing will not proceed. The First Placing will not be affected by the Second Placing failing to complete for any reason.
The Directors have provided irrevocable undertakings to vote in favour of the Resolutions in respect of their beneficial shareholdings in the Company, which represent, in aggregate, approximately 9.85 per cent. of the issued share capital of the Company.
Admission to AIM
Application will be made to London Stock Exchange for admission of the First Placing Shares to trading on AIM ("First Admission"). Subject to completion of the Bookbuild, First Admission is expected to occur on or around 27 June 2025 or such later time and/or date as the Bookrunners and the Company may otherwise agree (being in any event no later than 8.00 a.m. on 11 July 2025).
Application will be made to London Stock Exchange for admission of the Second Placing Shares to trading on AIM ("Second Admission"), subject, amongst other things, to completion of the First Placing and the passing of the Resolutions. Second Admission is expected to occur on or around 15 July 2025 or such later time and/or date as the Bookrunners and the Company may agree (being in any event no later than 8.00 a.m. on 29 July 2025).
*Adjusted EBITDA excludes one-off non-cash items (including share-based payments and asset impairments). It is expected that there will be a non-cash IFRS accounting impairment of up to US$16 million (unaudited) on the Williston project in the Results primarily as a result of lower oil prices at 31 December 2024 versus the previous year.
IMPORTANT NOTICES
Notice to Distributors
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 into the United States. The securities referred to herein have not been and will not be registered under the U.S. Securities Act of 1933, as amended, and may not be offered or sold in the United States, except pursuant to an applicable exemption from registration. No public offering of securities is being made in the United States.
UK Product Governance Requirements
Solely for the purposes of the product governance requirements contained within 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 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 "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 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 Bookrunners will only procure investors who 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 chapters 9A or 10A respectively of the 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 Placing Shares. Each distributor is responsible for undertaking its own target market assessment in respect of the 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 and as this is applied in the United Kingdom ("MiFID II"); (b) Articles 9 and 10 of Commission Delegated Directive (EU) 2017/593 supplementing MiFID II; and (c) local implementing measures (together, the "MiFID II Product Governance Requirements"), and disclaiming all and any liability, whether arising in tort, contract or otherwise, which any "manufacturer" (for the purposes of the MiFID II Product Governance Requirements) may otherwise have with respect thereto, the Placing Shares have been subject to a product approval process, which has determined that such securities are: (i) compatible with an end target market of retail investors who do not need a guaranteed income or capital protection 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"). The Placing Shares are not appropriate for a target market of investors whose objectives include no capital loss. 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 projection, 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 Bookrunners will only procure investors 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 or appropriateness for the purposes of MiFID II; or (b) a recommendation to any investor or group of investors to invest in, or purchase, or take any other action whatsoever with respect to the Placing Shares. Each distributor is responsible for undertaking its own target market assessment in respect of the shares and determining appropriate distribution channels.
Forward Looking Statements
This Announcement includes statements that are, or may be deemed to be, "forward-looking statements". These forward-looking statements can be identified by the use of forward-looking terminology, including the terms "believes", "estimates", "plans", "anticipates", "targets", "aims", "continues", "expects", "intends", "hopes", "may", "will", "would", "could" or "should" or, in each case, their negative or other variations or comparable terminology. These forward-looking statements include matters that are not facts. They appear in a number of places throughout this Announcement and include statements regarding the Directors' beliefs or current expectations. By their nature, forward-looking statements involve risk and uncertainty because they relate to future events and circumstances. Investors should not place undue reliance on forward-looking statements, which speak only as of the date of this Announcement.
Notice to overseas persons
This Announcement does not constitute, or form part of, a prospectus relating to the Company, nor does it constitute or contain any invitation or offer to any person, or any public offer, to subscribe for, purchase or otherwise acquire any shares in the Company or advise persons to do so in any jurisdiction, nor shall it, or any part of it form the basis of or be relied on in connection with any contract or as an inducement to enter into any contract or commitment with the Company.
This Announcement is not for release, publication or distribution, in whole or in part, directly or indirectly, in or into the United States of America, Canada, Australia, Japan or the Republic of South Africa or any jurisdiction into which the publication or distribution would be unlawful. This Announcement is for information purposes only and does not constitute an offer to sell or issue or the solicitation of an offer to buy or acquire shares in the capital of the Company in the United States of America, Canada, Australia, Japan, the Republic of South Africa or any jurisdiction in which such offer or solicitation would be unlawful or require preparation of any prospectus or other offer documentation or would be unlawful prior to registration, exemption from registration or qualification under the securities laws of any such jurisdiction. Persons into whose possession this Announcement comes are required by the Company to inform themselves about, and to observe, such restrictions.
Timetable
The times and dates set out throughout this Announcement may be adjusted by the Company in which event the Company will make an appropriate announcement to a Regulatory Information Service giving details of any revised times and dates which will also be notified to the London Stock Exchange and, where appropriate, shareholders of the Company. Shareholders of the Company may not receive any further written communication.
References to times in this Announcement are to the time in London, UK unless otherwise stated.
Qualified Person
Dr Gregor Maxwell, BSc Hons. Geology and Petroleum Geology, PhD, Technical Adviser to the Board of Zephyr Energy plc, who meets the criteria of a qualified person under the AIM Note for Mining and Oil & Gas Companies - June 2009, has reviewed and approved the technical information contained within this Announcement.
General
Neither the content of the Company's website (or any other website) nor the content of any website accessible from hyperlinks on the Company's website (or any other website) or any previous announcement made by the Company is incorporated into, or forms part of, this Announcement.
This Announcement has been issued by, and is the sole responsibility of, the Company.
Allenby Capital, which is authorised and regulated by the FCA in the United Kingdom, is acting as Nominated Adviser to the Company. Allenby Capital will not be responsible to any person other than the Company for providing the protections afforded to clients of Allenby Capital or for providing advice to any other person in connection with the Placing or any acquisition of shares in the Company. Allenby Capital has not authorised the contents of, or any part of, this Announcement, no representation or warranty, express or implied, is made by Allenby Capital in respect of such contents, and no liability whatsoever is accepted by Allenby Capital for the accuracy of any information or opinions contained in this Announcement or for the omission of any material information, save that nothing shall limit the liability of Allenby Capital for its own fraud. Allenby Capital's responsibilities as the Company's Nominated Adviser under the AIM Rules for Nominated Advisers are owed solely to the London Stock Exchange and are not owed to the Company or to any Director or to any other person.
Canaccord, which is authorised and regulated by the FCA in the United Kingdom, is acting as Joint Broker and Bookrunner to the Company in connection with the Placing. Canaccord will not be responsible to any person other than the Company for providing the protections afforded to clients of Canaccord or for providing advice to any other person in connection with the Placing or any acquisition of shares in the Company. Canaccord is not making any representation or warranty, express or implied, as to the contents of this Announcement. Canaccord has not authorised the contents of, or any part of, this Announcement, and no liability whatsoever is accepted by Canaccord for the accuracy of any information, or opinions contained in this Announcement or for the omission of any material information, save that nothing shall limit the liability of Canaccord for its own fraud.
Turner Pope, which is authorised and regulated by the FCA in the United Kingdom, is acting as Joint Broker and Bookrunner to the Company in connection with the Placing. Turner Pope will not be responsible to any person other than the Company for providing the protections afforded to clients of Turner Pope or for providing advice to any other person in connection with the Placing or any acquisition of shares in the Company. Turner Pope is not making any representation or warranty, express or implied, as to the contents of this Announcement. Turner Pope has not authorised the contents of, or any part of, this Announcement, and no liability whatsoever is accepted by Turner Pope for the accuracy of any information, or opinions contained in this Announcement or for the omission of any material information, save that nothing shall limit the liability of Turner Pope for its own fraud.
No statement in this Announcement is intended to be a profit forecast and no statement in this Announcement should be interpreted to mean that the 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.
This Announcement does not constitute a recommendation concerning any investor's investment decision with respect to the Placing. Each investor or prospective investor should conduct his, her or its own investigation, analysis and evaluation of the business and data described in this Announcement and publicly available information.
The new Ordinary Shares will not be admitted to trading on any stock exchange other than the AIM market of the London Stock Exchange.
Appendix I to this Announcement sets out the terms and conditions of the Placing. By participating in the Bookbuild, each person who is invited to and who chooses to participate in the Placing by making or accepting an oral and/or written legally binding offer to subscribe for Placing Shares will be deemed to have read and understood this Announcement (including Appendix I) in its entirety, to be making or accepting such offer on the terms and subject to the conditions of the Placing set out in this Announcement and to be providing the representations, warranties, undertakings, agreements and acknowledgements contained in Appendix I.
The price and value of securities can go down as well as up. Past performance is not a guide to future performance.
APPENDIX I
TERMS AND CONDITIONS OF THE PLACING AND BOOKBUILD
IMPORTANT INFORMATION ON THE PLACING FOR INVITED PLACEES ONLY
MEMBERS OF THE PUBLIC ARE NOT ELIGIBLE TO TAKE PART IN THE PLACING
THE TERMS AND CONDITIONS SET OUT HEREIN ("TERMS AND CONDITIONS") ARE DIRECTED ONLY AT PERSONS WHOSE ORDINARY ACTIVITIES INVOLVE THEM IN ACQUIRING, HOLDING, MANAGING AND DISPOSING OF INVESTMENTS (AS PRINCIPAL OR AGENT) FOR THE PURPOSES OF THEIR BUSINESS AND WHO HAVE PROFESSIONAL EXPERIENCE IN MATTERS RELATING TO INVESTMENTS AND ARE: (1) IF IN THE UNITED KINGDOM, "QUALIFIED INVESTORS", BEING PERSONS FALLING WITHIN THE MEANING OF ARTICLE 2(E) OF THE UK PROSPECTUS REGULATION, WHO (A) FALL WITHIN ARTICLE 19(5) (INVESTMENT PROFESSIONALS) OF THE FINANCIAL SERVICES AND MARKETS ACT 2000 (FINANCIAL PROMOTION) ORDER 2005, AS AMENDED (THE "ORDER") OR (B) FALL WITHIN ARTICLE 49(2)(A) TO (D) (HIGH NET WORTH COMPANIES, UNINCORPORATED ASSOCIATIONS, ETC.) OF THE ORDER; (2) IF IN MEMBER STATES OF THE EEA, "QUALIFIED INVESTORS", BEING PERSONS FALLING WITHIN THE MEANING OF ARTICLE 2(E) OF THE PROSPECTUS REGULATION; OR (3) PERSONS TO WHOM THEY MAY OTHERWISE LAWFULLY BE COMMUNICATED (ALL SUCH PERSONS TOGETHER BEING REFERRED TO AS "RELEVANT PERSONS").
THE TERMS AND CONDITIONS AND THE INFORMATION HEREIN MUST NOT BE ACTED ON OR RELIED ON BY PERSONS WHO ARE NOT RELEVANT PERSONS. ANY INVESTMENT OR INVESTMENT ACTIVITY TO WHICH THE TERMS AND CONDITIONS RELATE IS AVAILABLE ONLY TO RELEVANT PERSONS AND WILL BE ENGAGED IN ONLY WITH RELEVANT PERSONS. THE TERMS AND CONDITIONS DO NOT THEMSELVES CONSTITUTE AN OFFER FOR SALE OR SUBSCRIPTION OF ANY SECURITIES IN ZEPHYR ENERGY PLC.
THE TERMS AND CONDITIONS ARE RESTRICTED AND ARE NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, IN WHOLE OR IN PART, DIRECTLY OR INDIRECTLY, IN OR INTO OR FROM THE UNITED STATES, AUSTRALIA, CANADA, THE REPUBLIC OF SOUTH AFRICA OR JAPAN OR ANY OTHER JURISDICTION IN WHICH SUCH RELEASE, PUBLICATION OR DISTRIBUTION WOULD BE UNLAWFUL.
THE PLACING SHARES HAVE NOT BEEN AND WILL NOT BE REGISTERED UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT") OR UNDER THE APPLICABLE SECURITIES LAWS OR WITH ANY SECURITIES REGULATORY AUTHORITY OF ANY STATE OR JURISDICTION OF THE UNITED STATES, AND MAY NOT BE OFFERED, SOLD OR OTHERWISE TRANSFERRED, DIRECTLY OR INDIRECTLY, IN OR INTO THE UNITED STATES EXCEPT PURSUANT TO AN EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND IN COMPLIANCE WITH ANY APPLICABLE SECURITIES LAWS OF ANY STATE OR OTHER JURISDICTION OF THE UNITED STATES. THE PLACING SHARES ARE BEING OFFERED AND SOLD ONLY OUTSIDE THE UNITED STATES IN "OFFSHORE TRANSACTIONS" WITHIN THE MEANING OF, AND IN ACCORDANCE WITH, REGULATION S UNDER THE SECURITIES ACT AND OTHERWISE IN ACCORDANCE WITH APPLICABLE LAWS. NO PUBLIC OFFERING OF THE PLACING SHARES IS BEING MADE IN THE UNITED STATES OR ELSEWHERE.
The distribution of the Terms and Conditions and/or the Placing and/or issue of the Placing Shares in certain jurisdictions may be restricted by law. No action has been taken by the Company, the Bookrunners or any of their respective affiliates, agents, directors, officers or employees that would permit an offer of the Placing Shares or possession or distribution of the Terms and Conditions or any other offering or publicity material relating to such Placing Shares in any jurisdiction where action for that purpose is required. Persons into whose possession these Terms and Conditions come are required by the Company and the Bookrunners to inform themselves about and to observe any such restrictions.
The Terms and Conditions or any part of them are for information purposes only and do not constitute or form part of any offer to issue or sell, or the solicitation of an offer to acquire, purchase or subscribe for, any securities in the United States (including its territories and possessions, any state of the United States and the District of Columbia), Australia, Canada, the Republic of South Africa or Japan or any other jurisdiction in which the same would be unlawful. No public offering of the Placing Shares is being made in any such jurisdiction.
In the United Kingdom, the Terms and Conditions are being directed solely at persons in circumstances in which section 21(1) of the Financial Services and Markets Act 2000 (as amended) (the "FSMA") does not apply.
The Placing Shares have not been approved or disapproved by the US Securities and Exchange Commission, any state securities commission or other regulatory authority in the United States, nor have any of the foregoing authorities passed upon or endorsed the merits of the Placing or the accuracy or adequacy of these Terms and Conditions or the 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 for the South Africa Reserve Bank or any other applicable body in the Republic of South Africa in relation to the Placing Shares and the Placing Shares have not been, nor will they be, registered under or offering in compliance with the securities laws of any state, province or territory of Australia, 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 Australia, Canada, the Republic of South Africa or Japan or any other jurisdiction outside the United Kingdom in which such offer, sale, re-sale or delivery would be unlawful.
Each Placee should consult with its advisers as to legal, tax, business and related aspects of an investment in Placing Shares.
Persons (including, without limitation, nominees and trustees) who have a contractual right or other legal obligations to forward a copy of the Terms and Conditions (or any part of them) should seek appropriate advice before taking any action.
The Terms and Conditions should be read in their entirety.
By participating in the Placing (such participation to be confirmed in and evidenced by either (i) a recorded telephone conversation or (ii) email correspondence, in either case between representatives of the respective Bookrunner to whom the Placee's commitment is given and the relevant Placee (a "Recorded Commitment")), each Placee will be deemed to have read and understood these Terms and Conditions in their entirety, to be providing the representations, warranties, indemnities, acknowledgements and undertakings contained in these Terms and Conditions, and to be irrevocably offering to participate and acquire Placing Shares on these Terms and Conditions. Such offer shall be deemed to be accepted, and a Placee shall become bound to acquire Placing Shares, when a Bookrunner confirms to such Placee its allocation of Placing Shares. Upon being notified of its allocation of Placing Shares, a Placee shall be contractually committed to acquire the number of Placing Shares allocated to it at the Issue Price.
Each Placee irrevocably represents, warrants, undertakes, agrees and acknowledges to the Company and the Bookrunners that:
1. it is a Relevant Person and that it will acquire, hold, manage or dispose of any Placing Shares that are allocated to it for the purposes of its business;
2. it is acquiring the Placing Shares for its own account or is acquiring the Placing Shares for an account with respect to which it exercises sole investment discretion and has the authority to make and does make the representations, warranties, indemnities, acknowledgements, undertakings and agreements contained in these Terms and Conditions;
3. it understands (or if acting for the account of another person, such person has confirmed that such person understands) and agrees to comply with the resale and transfer restrictions set out in these Terms and Conditions; and
4. 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 2 above) is outside the United States acquiring the Placing Shares in offshore transactions as defined in and in accordance with Regulation S under the Securities Act.
No prospectus
The Placing Shares are being offered to a limited number of specifically invited persons only and will not be offered in such a way as to require any prospectus or other offering document to be published. No prospectus or other offering document has been or will be submitted to be approved by (i) the Financial Conduct Authority ("FCA") or (ii) any competent authority of any Relevant Member State, 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 these Terms and Conditions (the "Publicly Available Information") and subject to any further terms set forth in writing in any contract note sent to an individual Placee.
Each Placee, by participating in the Placing, agrees that the content of the Announcement is exclusively the responsibility of the Company and confirms that it has neither received nor relied on any information (other than the Publicly Available Information), representation, warranty or statement made by or on behalf of either of the Bookrunners or the Company or any other person and none of the Bookrunners, the Company nor any other person acting on such person's behalf nor any of their respective affiliates has or shall have any liability for any Placee's decision to participate in the Placing based on any other information, representation, warranty or statement. Each Placee acknowledges and agrees that it has relied on its own investigation of the business, financial or other position of the Company in accepting a participation in the Placing. No Placee should consider any information in the Announcement or these Terms and Conditions to be legal, tax, business or other advice. Nothing in this paragraph shall exclude the liability of any person for fraudulent misrepresentation.
Details of the Placing Agreement and the Placing Shares
The Bookrunners have entered into the Placing Agreement with the Company under which, on the terms and subject to the conditions set out in the Placing Agreement, each of the Bookrunners, as agent for and on behalf of the Company, has agreed to use its reasonable endeavours to procure Placees for the Placing Shares at the Issue Price.
The Placing Shares will, when issued, be subject to the memorandum and articles of association of the Company and credited as fully paid and will rank pari passu in all respects with the existing issued Ordinary Shares, including the right to receive all dividends and other distributions declared, made or paid in respect of such Ordinary Shares after the date of issue of the Placing Shares.
Application for admission to trading
Application(s) will be made to the London Stock Exchange for admission of the Placing Shares to trading on AIM.
It is expected that First Admission will take place on or around 27 June 2025 and that dealings in the First Placing Shares on AIM will commence at the same time.
It is expected that Second Admission will take place on or around 15 July 2025 and that dealings in the Second Placing Shares on AIM will commence at the same time.
Principal terms of the Placing
1. Canaccord and Turner Pope are each acting as joint brokers and bookrunners pursuant to the Placing, as agents for and on behalf of the Company.
2. Participation in the Placing is by invitation only and will only be available to persons who may lawfully be, and are, invited by either of the Bookrunners to participate. The Bookrunners and any of their respective affiliates are entitled to participate in the Placing as principal.
3. Each Placee's allocation will be confirmed to Placees orally, or in writing (which can include email), by a Bookrunner and a trade confirmation or contract note will be dispatched as soon as possible thereafter. The Bookrunners' oral or written confirmation will give rise to an irrevocable, legally binding commitment by that Placee, in favour of the Bookrunner and the Company, under which it agrees to acquire by subscription the number of Placing Shares allocated to it at the Issue Price and otherwise on these Terms and Conditions. Except with the consent of the relevant Bookrunner, such commitment will not be capable of variation or revocation.
4. The price per Placing Share (the "Issue Price") is fixed at 3.0 pence and is payable to the relevant Bookrunner (as agent for the Company) by all Placees.
5. Each Placee's allocation and whether such Placee participates in the Placing will be determined by the Bookrunners in their discretion following consultation with the Company and will be confirmed by the relevant Bookrunner.
6. Each Placee's commitment will be confirmed in and evidenced by a Recorded Commitment. These Terms and Conditions will be deemed incorporated into the contract which is entered into by way of a Recorded Commitment and will be legally binding on the relevant Placee(s) on behalf of whom the commitment is made with effect from the end of the Recorded Commitment and, except with the relevant Bookrunners' prior written consent, will not be capable of variation or revocation after such time. Without prejudice to the foregoing, a contract note recording each Placee's commitment will be sent to them following the Recorded Commitment. These Terms and Conditions shall be deemed incorporated into any such contract note.
7. Each Placee will confirm the maximum number of Placing Shares it is willing to acquire in a Recorded Commitment. Once they have made a Recorded Commitment, each Placee will have an immediate, separate, irrevocable and binding obligation, owed to the relevant Bookrunner (as agent for the Company), to pay to it (or as it may direct) in cleared funds an amount equal to the product of the Issue Price and the number of Placing Shares such Placee has agreed to acquire.
8. Each Bookrunner reserves the right to scale back the number of Placing Shares to be subscribed by any Placee in the event that the Placing is oversubscribed. Each Bookrunner also reserves the right not to accept offers to subscribe for Placing Shares or to accept such offers in part rather than in whole. The acceptance and, if applicable, scaling back of offers shall be at the absolute discretion of the relevant Bookrunner.
9. Any Placees who are existing shareholders of the Company undertake that they shall vote in favour of each of the Resolutions proposed at the General Meeting.
10. Except as required by law or regulation, no press release or other announcement will be made by either 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.
11. Irrespective of the time at which a Placee's allocation(s) pursuant to the Placing is/are confirmed, settlement for all First Placing Shares to be acquired pursuant to the Placing will be required to be made at the same time and settlement for all Second Placing Shares to be acquired pursuant to the Placing will be required to be made at the same time, in each case on the basis explained below under "Registration and settlement".
12. All obligations under the Placing will be subject to fulfilment of the conditions referred to below under "Conditions of the Placing" and to the Placing not being terminated on the basis referred to below under "Termination of the Placing".
13. By participating in the Placing, each Placee agrees that its rights and obligations in respect of the Placing will terminate only in the circumstances described below and will not be capable of rescission or termination by the Placee.
14. To the fullest extent permissible by law and applicable FCA rules, neither:
(a) Canaccord or Turner Pope;
(b) any of their respective affiliates, agents, advisers, directors, officers, consultants or employees; nor
(c) to the extent not contained within (a) or (b), any person connected with either Bookrunner as defined in the FSMA ((b) and (c) being together "affiliates" and individually an "affiliate" of the respective Bookrunner),
shall have any liability (including to the extent permissible by law, any fiduciary duties) to Placees or to any other person whether acting on behalf of a Placee or otherwise. In particular, neither of the Bookrunners nor any of their respective affiliates shall have any liability (including, to the extent permissible by law, any fiduciary duties) in respect of the Bookrunners' conduct of the Placing or of such alternative method of effecting the Placing as the Bookrunners and the Company may agree.
Registration and settlement
By participating in the Placing, each Placee will be deemed to agree that it will do all things necessary to ensure that delivery and payment is completed as directed by the relevant Bookrunner in accordance with either the standing CREST or certificated settlement instructions which they have in place with the relevant Bookrunner.
Settlement of transactions in the First Placing Shares following First Admission will take place within the CREST system, subject to certain exceptions. Settlement through CREST will be on a delivery versus payment basis ("DVP") unless otherwise notified by the relevant Bookrunner and is expected to occur on the First Admission Settlement Date.
Settlement of transactions in the Second Placing Shares following Second Admission will take place within the CREST system, subject to certain exceptions. Settlement through CREST will be on a DVP basis unless otherwise notified by the relevant Bookrunner and is expected to occur on the Second Settlement Date.
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 (or any of them) should be issued in certificated form. The Bookrunners reserve the right to require settlement for any of the Placing Shares, and to deliver the any of the Placing Shares to any Placees, by such other means as they deem necessary if delivery or settlement to any Placee is not practicable within the CREST system or would not be consistent with regulatory requirements in the jurisdiction in which a Placee is located.
Interest is chargeable daily on payments not received from Placees on or before the due date in accordance with the arrangements set out above, in respect of either CREST or certificated deliveries, at the rate of 3 percentage points above prevailing base rate of Barclays Bank plc as determined by the relevant Bookrunner.
Each Placee is deemed to agree that if it does not comply with these obligations, the Bookrunners may sell any or all of their Placing Shares on their behalf and retain from the proceeds, for the relevant Bookrunner's own account and benefit, an amount equal to the aggregate amount owed by the Placee plus any interest due. The relevant Placee will, however, remain liable for any shortfall below the Issue Price and for any stamp duty or stamp duty reserve tax (together with any interest or penalties) which may arise upon the sale of its Placing Shares on its behalf.
If Placing Shares are to be delivered to a custodian or settlement agent, Placees must ensure that, upon receipt, any relevant contract note 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. Placees will not be entitled to receive any fee or commission in connection with the Placing.
Conditions of the Placing
The Placing is conditional upon the Placing Agreement becoming unconditional and not having been terminated in accordance with its terms.
(a) The obligations of the Bookrunners under the Placing Agreement are, and the Placing of the First Placing Shares is, conditional upon, inter alia: the warranties in the Placing Agreement being true and accurate and not misleading; and
(b) First Admission having occurred not later than 8.00 a.m. on 27 June 2025 or such later date as the Company and the Bookrunners may agree, but in any event not later than 8.00 a.m. on the Long Stop Date.
Once First Admission has occurred, no party to the Placing Agreement shall be able to terminate any part of the Placing Agreement which relates to First Admission and/or the placing, allotment or issue of the First Placing Shares.
The obligations of the Bookrunners under the Placing Agreement are, and the Placing of the Second Placing Shares is, conditional upon, inter alia:
(a) First Admission having occurred;
(b) the Resolutions having been passed without amendment by the required majority at the General Meeting;
(c) Second Admission having occurred not later than 8.00 a.m. on 15 July 2025 or such later date as the Company and the Bookrunners may agree, but in any event not later than 8.00 a.m. on the Long Stop Date.
All conditions to the obligations of the Bookrunners included in the Placing Agreement are together referred to in these Terms and Conditions as the "conditions".
If any of the conditions is not fulfilled or, where permitted, waived in accordance with the Placing Agreement within the stated time periods (or such later time and/or date as the Company and the Bookrunners may agree), or the Placing Agreement is terminated in accordance with its terms, the Placing (or such part of it as may then remain to be completed) will lapse and the Placee's rights and obligations shall cease and terminate at such time and each Placee agrees that no claim can be made by or on behalf of the Placee (or any person on whose behalf the Placee is acting) in respect thereof.
By participating in the Placing, each Placee agrees that its rights and obligations cease and terminate only in the circumstances described above and under "Termination of the Placing" below and will not be capable of rescission or termination by it.
The Bookrunners may, in their absolute discretion and upon such terms as they think fit, waive fulfilment of certain conditions in the Placing Agreement in whole or in part, or extend the time provided for fulfilment of one or more conditions, save that certain conditions (including as regards the First Placing Shares the condition relating to First Admission referred to in paragraph (c) above, and as regards the Second Placing Shares the condition relating to Second Admission referred to in paragraph (d) above) may not be waived. Any such extension or waiver will not affect Placees' commitments as set out in these Terms and Conditions.
The Bookrunners may terminate the Placing Agreement in certain circumstances, details of which are set out below.
Neither of the Bookrunners nor any of their respective affiliates, agents, advisers, directors, officers or employees nor the Company shall have any liability to any Placee (or to any other person whether acting on behalf of a Placee or otherwise) in respect of any decision any of them may make as to whether or not to waive or to extend the time and/or date for the satisfaction of any condition to the Placing (or any part thereof) nor for any decision any of them may make as to the satisfaction of any condition or in respect of the Placing generally (or any part thereof) and by participating in the Placing each Placee agrees that any such decision is within the absolute discretion of the Bookrunners.
Termination of the Placing
Either Bookrunner may, in its absolute discretion, by notice to the Company, terminate the Placing Agreement at any time up to Second Admission if, inter alia:
(a) the Company fails in any material respect to comply with any of its obligations under the Placing Agreement or it commits a breach of the rules and regulations of the FCA and/or London Stock Exchange and/or the AIM Rules, FSMA, MAR or any other applicable law; or
(b) it comes to the notice of either Bookrunner that any statement contained in the documents issued by the Company in connection with the Placing was untrue, incorrect or misleading at the date of such document in any respect which a Bookrunner considers to be material; or
(c) it comes to the notice of either Bookrunner that any of the warranties given by the Company in the Placing Agreement was not at the date of the agreement true and accurate in any respect which either Bookrunner considers to be material; or
(d) in the opinion of either Bookrunner there shall have occurred any Material Adverse Change (as defined in the Placing Agreement).
Either Bookrunner may also, after having to the extent practicable in the circumstances consulted with the Company, give notice in writing to the Company prior to Second Admission to rescind the Placing Agreement in certain circumstances, including where there is a general moratorium on commercial banking activities in London or the outbreak or escalation of hostilities involving the United Kingdom.
If the Placing Agreement is terminated in accordance with its terms, the rights and obligations of each Placee in respect of the Placing as described in these Terms and Conditions shall cease and terminate at such time and no claim can be made by any Placee in respect thereof.
Notwithstanding any other provision of the Placing Agreement, once First Admission has occurred no party to the Placing Agreement shall be able to terminate any part of the Placing Agreement which relates to First Admission and/or the placing, allotment or issue of the First Placing Shares.
By participating in the Placing, each Placee agrees with the Company and the Bookrunners that the exercise by the Company or either of the Bookrunners of any right of termination or any other right or other discretion under the Placing Agreement shall be within the absolute discretion of the Company or the relevant Bookrunner or for agreement between the Company and the Bookrunners (as the case may be) and that neither the Company nor either of the Bookrunners need make any reference to such Placee and that none of the Company, the Bookrunners nor any of their respective affiliates, agents, advisers, directors, officers or employees shall have any liability to such Placee (or to any other person whether acting on behalf of a Placee or otherwise) whatsoever in connection with any such exercise.
By agreeing with the relevant Bookrunner as agent of the Company to subscribe for Placing Shares under the Placing, a Placee (and any person acting on a Placee's behalf) will irrevocably acknowledge and confirm and warrant and undertake to, and agree with, each of the Company and the Bookrunners, in each case as a fundamental term of such Placee's application for Placing Shares and of the Company's obligation to allot and/or issue any Placing Shares to it or at its direction, that its rights and obligations in respect of the Placing (or any part of it) will terminate only in the circumstances described above and under the "Conditions of the Placing" section above and will not be capable of rescission or termination by it in any other circumstances.
Representations, warranties and further terms
By participating in the Placing, each Placee (and any person acting on such Placee's behalf) represents, warrants, acknowledges, undertakes, confirms and agrees (for itself and for any such prospective Placee) that (save where the Bookrunners expressly agree in writing to the contrary):
1. it has read and understood these Terms and Conditions in their 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 Admission, the Placing, the Company, the Placing Shares or otherwise, other than the information contained in the Announcement and the Publicly Available Information;
2. it has not received a prospectus or other offering document in connection with the Placing and acknowledges that no prospectus or other offering document:
(a) is required under any applicable law; and
(b) has been or will be prepared in connection with the Placing;
3. the Ordinary Shares are admitted to trading on AIM, and that the Company is therefore required to publish certain business and financial information in accordance with the AIM Rules and the Market Abuse Regulation (EU Regulation No. 596/2014) as it forms part of UK domestic law by virtue of the European Union (Withdrawal) Act 2018 (the "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 the terms of the Placing and has relied on its own investigation of the business, financial position and other aspects of the Company in accepting a participation in the Placing and neither the Bookrunners nor the Company nor any of their respective affiliates, agents, advisers, directors, officers or employees nor any person acting on behalf of any of them has provided, and will not provide, it with any material regarding the Placing Shares or the Company or any other person other than the information in the Announcement and these Terms and Conditions or the Publicly Available Information; nor has it requested either of the Bookrunners, the Company, any of their respective affiliates, agents, advisers, directors, employees or officers or any person acting on behalf of any of them to provide it with any such information;
5. neither the Bookrunners nor any person acting on behalf of either of them nor any of their respective affiliates, agents, directors, officers or employees has or shall have any liability for any Publicly Available Information, or any representation relating to the Company, provided that nothing in the Terms and Conditions excludes the liability of any person for any fraudulent misrepresentation made by that person;
6. that:
(a) the only information which it is entitled to rely on and on which it has relied in committing to acquire the Placing Shares is contained in the Announcement and the Publicly Available Information, such information being all that it deems necessary to make an investment decision in respect of the Placing Shares and it has made its own assessment of the Company, the Placing Shares and the terms of the Placing based on the Announcement and the Publicly Available Information;
(b) neither the Bookrunners nor any of their respective affiliates, agents, directors, officers or employees have made any representation or warranty to it, express or implied, with respect to the Company, the Placing or the Placing Shares or the accuracy, completeness or adequacy of any documentation issued by the Company in connection with the Placing or the Publicly Available Information;
(c) it has conducted its own investigation of the Company, the Placing and the Placing Shares, satisfied itself that the information is still current and relied on that investigation for the purposes of its decision to participate in the Placing; and
(d) it has not relied on any investigation that the Bookrunners or any person acting on their behalf may have conducted with respect to the Company, the Placing or the Placing Shares;
7. the content of the Announcement and the other Publicly Available Information as well as any information made available (in written or oral form) in presentations or as part of roadshow discussions with investors relating to the Company (the "Information") has been prepared by and is exclusively the responsibility of the Company and that neither the Bookrunners nor any persons acting on their behalf is responsible for or has or shall have any liability for any such Information, representation, warranty or statement relating to the Company contained in therein nor will they be liable for any Placee's decision to participate in the Placing based on any Information or any representation, warranty or statement contained therein or otherwise. Nothing in these Terms and Conditions shall exclude any liability of any person for fraudulent misrepresentation;
8. it has the funds available to pay for the Placing Shares which it has agreed to acquire and acknowledges and agrees that it will pay the total subscription amount in accordance with these Terms and Conditions by the due time and date set out herein, failing which the relevant Placing Shares may be placed with other Placees or sold at such price as the Bookrunners determine;
9. it and/or each person on whose behalf it is participating:
(a) is entitled to acquire Placing Shares pursuant to the Placing under the laws and regulations of all relevant jurisdictions;
(b) has fully observed such laws and regulations;
(c) has capacity and authority and is entitled to enter into and perform its obligations as an acquirer of Placing Shares and will honour such obligations; and
(d) has obtained all necessary consents and authorities (including, without limitation, in the case of a person acting on behalf of a Placee, all necessary consents and authorities to agree to the terms set out or referred to in these Terms and Conditions) under those laws or otherwise and complied with all necessary formalities to enable it to enter into the transactions contemplated hereby and to perform its obligations in relation thereto and, in particular, if it is a pension fund or investment company it is aware of and acknowledges it is required to comply with all applicable laws and regulations with respect to its acquisition of Placing Shares;
10. in the case of any Placing Shares acquired by it as a financial intermediary, as that term is used in Regulation 5(1) of the Prospectus Regulation and Regulation 5(1) of the UK Prospectus Regulation:
(a) 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 in circumstances where either the Prospectus Regulation or the UK Prospectus Regulation applies to, persons in any Relevant Member State or in the UK other than Qualified Investors (as defined under the Prospectus Regulation or the UK Prospectus Regulation respectively) in circumstances in which the prior consent of the Bookrunners has not been given to the offer or resale; or
(b) where Placing Shares have been acquired by it on behalf of persons in any member state of the EEA or in the UK other than EU or UK Qualified Investors (as defined under the Prospectus Regulation or the UK Prospectus Regulation respectively), the offer of those Placing Shares to it is not treated under the Prospectus Regulation or the EU Prospectus Regulation as having been made to such persons;
11. it is not, and any person who it is acting on behalf of is not, and at the time the Placing Shares are acquired will not be, a resident of, or have an address in, or be subject to the laws of, Australia, Canada, the Republic of South Africa or Japan, and it acknowledges and agrees that the Placing Shares have not been and will not be registered or otherwise qualified under the securities legislation of Australia, Canada, the Republic of South Africa or Japan and may not be offered, sold, or acquired, directly or indirectly, within those jurisdictions;
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 Placing Shares with a view to any offer, sale or distribution thereof within the meaning of the Securities Act;
15. it will not offer, sell, transfer, pledge or otherwise dispose of any Placing Shares except:
(a) in an offshore transaction in accordance with Rules 903 or 904 of Regulation S under the Securities Act; or
(b) pursuant to another exemption from registration under the Securities Act, if available,
and in each case in accordance with all applicable securities laws of the states of the United States and all other applicable jurisdictions;
16. no representation has been made as to the availability of the exemption provided by Rule 144, Rule 144A or any other exemption under the Securities Act for the reoffer, resale, pledge or transfer of the Placing Shares;
17. it is not taking up the Placing Shares as a result of any "general solicitation" or "general advertising" efforts (as those terms are defined in the Securities Act) or any "directed selling efforts" (as such term is defined in Regulation S under the Securities Act);
18. it will not distribute, forward, transfer or otherwise transmit these Terms and Conditions and/or the Announcement or any part of them, or any other presentational or other materials concerning the Placing in or into or from the United States (including electronic copies thereof) to any person, and it has not distributed, forwarded, transferred or otherwise transmitted any such materials to any person;
19. neither of the Bookrunners, their respective affiliates or any person acting on behalf of any of them is making any recommendations to it or advising it regarding the suitability of any transactions it may enter into in connection with the Placing and that participation in the Placing is on the basis that it is not and will not be a client of either of the Bookrunners and that the Bookrunners have no duties or responsibilities to it for providing the protections afforded to their respective 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;
20. it will make payment to the relevant Bookrunner for the Placing Shares allocated to it in accordance with these Terms and Conditions on or by the specified time (being the First Admission Settlement Date in respect of any First Placing Shares and the Second Admission Settlement Date as regards any Second Placing Shares), failing which the relevant Placing Shares may be placed with others on such terms as the Bookrunners determine in their absolute discretion without liability to the Placee and it will remain liable for any shortfall below the net proceeds of such sale and the placing proceeds of such Placing Shares and may be required to bear any stamp duty or stamp duty reserve tax (together with any interest or penalties due pursuant to the terms set out or referred to in these Terms and Conditions) which may arise upon the sale of such Placee's Placing Shares on its behalf;
21. 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 Bookrunners 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;
22. no action has been or will be taken by any of the Company, the Bookrunners or any person acting on behalf of the Company or either of the Bookrunners that would, or is intended to, permit a public offer of the Placing Shares in the United States or in any country or jurisdiction where any such action for that purpose is required;
23. 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;
24. neither of the Bookrunners or the Company will be responsible for any liability to stamp duty or stamp duty reserve tax payable on the acquisition of the Placing Shares. 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 Bookrunners in respect of the same on the basis that the Placing Shares will be allotted to a CREST stock account of the relevant Bookrunner or transferred to a CREST stock account of the relevant Bookrunner who will hold them as nominee on behalf of the Placee until settlement in accordance with its standing settlement instructions with it;
25. 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, or the person specified by it for registration as holder of Placing Shares, 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;
26. it will (or will procure that its nominee will), if applicable, make notification to the Company of the interest in its ordinary shares in accordance with the Disclosure Guidance and Transparency Rules published by the FCA;
27. as far as it is aware it is not acting in concert (within the meaning given in The City Code on Takeovers and Mergers) with any other person in relation to the Company, save as previously disclosed to the Bookrunners;
28. 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;
29. it has not offered or sold and will not offer or sell any Placing Shares to persons in the United Kingdom except to persons whose ordinary activities involve them in acquiring, holding, managing or disposing of investments (as principal or agent) for the purposes of their business or otherwise in circumstances which have not resulted and which will not result in an offer to the public in the United Kingdom within the meaning of section 85(1) of the FSMA;
30. it has only communicated or caused to be communicated and it will only communicate or cause to be communicated any invitation or inducement to engage in investment activity (within the meaning of section 21 of the FSMA) relating to Placing Shares in circumstances in which section 21(1) of the FSMA does not require approval of the communication by an authorised person and it acknowledges and agrees that neither these Terms and Conditions nor the Announcement has not been approved by either of the Bookrunners 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;
31. it has complied and it will comply with all applicable laws in any jurisdiction with respect to anything done by it or on its behalf in relation to the Placing Shares (including all relevant provisions of the FSMA in respect of anything done in, from or otherwise involving the United Kingdom);
32. the Placing Shares acquired by it in the Placing will not be acquired on a non-discretionary basis on behalf of, nor will they be acquired with a view to their offer or resale to, any person save in circumstances in which the express prior written consent of the Bookrunners has been given to the offer or resale;
33. if it has received any inside information (for the purposes of the MAR and/or section 56 of the Criminal Justice Act 1993 or other applicable law) about the Company in advance of the Placing, it has not:
(a) dealt (or attempted to deal) in the securities of the Company;
(b) encouraged, recommended or induced another person to deal in the securities of the Company; or
(c) unlawfully disclosed such information to any person, prior to the information being made publicly available;
34. neither of the Bookrunners, the Company nor any of their respective affiliates, agents, advisers, directors, officers or employees nor any person acting on behalf of either of the Bookrunners or their respective affiliates, agents, advisers, directors, officers or employees nor any person acting on behalf of any of them is making any recommendations to it, advising it regarding the suitability of any transactions it may enter into in connection with the Placing nor providing advice in relation to the Placing nor in respect of any representations, warranties, acknowledgements, agreements, undertakings, or indemnities contained in the Placing Agreement nor the exercise or performance of any of the Bookrunners' rights and obligations thereunder including any rights to waive or vary any conditions or exercise any termination right;
35. each Bookrunner and its respective affiliates, acting as an investor for its or their own account(s), may bid or subscribe for and/or purchase Placing Shares and, in that capacity, may retain, purchase, offer to sell or otherwise deal for its or their own account(s) in the Placing Shares, any other securities of the Company or other related investments in connection with the Placing or otherwise. Accordingly, references in the Announcement and/or these Terms and Conditions 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, either Bookrunner and/or any of its respective affiliates acting as an investor for its or their own account(s). Neither of the Bookrunners nor the Company intend to disclose the extent of any such investment or transaction otherwise than in accordance with any legal or regulatory obligation to do so;
36. it:
(a) has complied, and will comply, with its obligations in connection with money laundering and terrorist financing under the Proceeds of Crime Act 2002, the Terrorism Act 2000 (as amended), the Terrorism Act 2006 and the Money Laundering, Terrorist Financing and Transfer of Funds (Information on the Payer) Regulations 2017;
(b) is not a person:
(i) with whom transactions are prohibited under the US Foreign Corrupt Practices Act of 1977 (as amended) or any economic sanction programmes administered by, or regulations promulgated by, the Office of Foreign Assets Control of the U.S. Department of the Treasury;
(ii) named on the Consolidated List of Financial Sanctions Targets maintained by HM Treasury of the United Kingdom; or
(iii) subject to financial sanctions imposed pursuant to a regulation of the European Union or a regulation adopted by the United Nations or other applicable law,
(all such statutes, rules and regulations referred to in this paragraph 36 together, the "Regulations") and if making payment on behalf of a third party, satisfactory evidence has been obtained and recorded by it to verify the identity of the third party as required by the Regulations and it 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 Bookrunners such evidence, if any, as to the identity or location or legal status of any person which they 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 either of the Bookrunners 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 Bookrunners may decide at their discretion;
37. in order to ensure compliance with the Regulations, each Bookrunner (for itself and as agent on behalf of the Company) or the Company's registrars may, in their absolute discretion, require verification of its identity. Pending the provision to the relevant Bookrunner or the Company's registrars, as applicable, of evidence of identity, definitive certificates in respect of the Placing Shares may be retained at the relevant Bookrunner's absolute discretion or, where appropriate, delivery of the Placing Shares to it in uncertificated form may be delayed at the relevant Bookrunner's or the Company's registrars', as the case may be, absolute discretion. If within a reasonable time after a request for verification of identity the relevant Bookrunner (for itself and as agent on behalf of the Company) or the Company's registrars have not received evidence satisfactory to them, either the relevant 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;
38. its commitment to acquire Placing Shares on the Terms and Conditions will continue notwithstanding any amendment that may in future be made to the terms and conditions of the Placing and that Placees will have no right to be consulted or require that their consent be obtained with respect to the Company's or the Bookrunners' conduct of the Placing;
39. 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;
40. it irrevocably appoints any duly authorised officer of either of the Bookrunners as its agent for the purpose of executing and delivering to the Company and/or its registrars any documents on its behalf necessary to enable it to be registered as the holder of any of the Placing Shares which it agrees to acquire upon these Terms and Conditions;
41. the Company, the Bookrunners and others (including each of their respective affiliates, agents, advisers, directors, officers and employees) will rely upon the truth and accuracy of the foregoing representations, warranties, acknowledgements and agreements, which are given to each Bookrunner on its own behalf and on behalf of the Company and are irrevocable;
42. it is acting as principal only in respect of the Placing or, if it is acquiring the Placing Shares as a fiduciary or agent for one or more investor accounts, it is duly authorised to do so and it has full power and authority to make, and does make, the foregoing representations, warranties, acknowledgements, agreements and undertakings on behalf of each such accounts;
43. time is of the essence as regards its obligations under these Terms and Conditions;
44. 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;
45. the Placing Shares will be issued subject to these Terms and Conditions; and
46. these Terms and Conditions and all documents into which these Terms and Conditions are incorporated by reference or of which they otherwise validly form a part and/or any agreements entered into pursuant to these Terms and Conditions and all agreements to acquire Placing Shares pursuant to the Placing will be governed by and construed in accordance with English law and it submits to the exclusive jurisdiction of the English courts in relation to any claim, dispute (contractual or otherwise) or matter arising out of or in connection with such contract except that enforcement proceedings in respect of the obligation to make payment for the Placing Shares (together with interest chargeable thereon) may be taken by the Company or either of the Bookrunners 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, each of the Bookrunners and each of their respective affiliates, agents, directors, officers and employees harmless from any and all costs, claims, liabilities and expenses (including legal fees and expenses) arising out of or in connection with any breach of the representations, warranties, acknowledgements, agreements and undertakings given by the Placee (and any person acting on such Placee's behalf) in these Terms and Conditions or incurred by either of the Bookrunners, the Company or any of their respective affiliates, agents, directors, officers or employees arising from the performance of the Placee's obligations as set out in these Terms and Conditions, and further agrees that the provisions of these Terms and Conditions shall survive after the completion of the Placing.
The agreement to allot and issue Placing Shares to Placees (or the persons for whom Placees are contracting as agent) free of stamp duty and stamp duty reserve tax in the United Kingdom relates only to their allotment and issue to Placees, or such persons as they nominate as their agents, 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 Bookrunners shall be responsible for such stamp duty or stamp duty reserve tax. If this is the case, each Placee should seek its own advice and they should notify the Bookrunners 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 Bookrunners in the event that any of the Company and/or either of the Bookrunners have incurred any such liability to such taxes or duties.
The representations, warranties, acknowledgements and undertakings contained in these Terms and Conditions are given to each of the Bookrunners for itself and on behalf of the Company and are irrevocable.
Turner Pope is authorised and regulated by the FCA in the United Kingdom and is acting exclusively for the Company and no one else in connection with the Placing, and Turner Pope 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 Placing or any other matters referred to in these Terms and Conditions.
Canaccord is authorised and regulated by the FCA in the United Kingdom and is acting exclusively for the Company and no one else in connection with the Placing, and Canaccord 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 Placing or any other matters referred to in these Terms and Conditions.
Each Placee and any person acting on behalf of the Placee acknowledges that the Bookrunners do not owe any fiduciary or other duties to any Placee in respect of any representations, warranties, undertakings, acknowledgements, agreements or indemnities in the Placing Agreement.
The provisions of these Terms and Conditions may be varied, waived or modified as regards specific Placees or on a general basis by the Bookrunners provided always that such variation, waiver or modification is not materially prejudicial to the interests of the Company.
In the case of a joint agreement to acquire Placing Shares, references to a "Placee" in these Terms and Conditions are to each of such Placees and such joint Placees' liability is joint and several.
Each Placee and any person acting on behalf of the Placee acknowledges and agrees that the Bookrunners may (at their absolute discretion) satisfy their obligations to procure Placees by themselves agreeing to become a Placee in respect of some or all of the Placing Shares or by nominating any connected or associated person to do so.
When a Placee or any person acting on behalf of the Placee is dealing with a Bookrunner, any money held in an account with the relevant 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 relevant Bookrunner's money in accordance with the client money rules and will be held by it under a banking relationship and not as trustee.
In these Terms and Conditions any words following the terms "including", "include", "in particular", "for example" or any similar expression shall be construed as illustrative and shall not limit the sense of the words, description, definition, phrase or term preceding those terms.
References to time in the Terms and Conditions are to London time, unless otherwise stated.
All times and dates in these Terms and Conditions may be subject to amendment. Placees will be notified of any changes.
No statement in the Announcement or these Terms and Conditions is intended to be a profit forecast or estimate, and no statement in the Announcement or these Terms and Conditions should be interpreted to mean that earnings per share of the Company for the current or future financial years would necessarily match or exceed the historical published earnings per share of the Company.
The price of 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 AIM.
Neither the content of the Company's website nor any website accessible by hyperlinks on the Company's website is incorporated in, or forms part of, these Terms and Conditions.
APPENDIX II
DEFINITIONS
The following definitions apply in this Announcement:
|
Admission |
First Admission and/or Second Admission as the context admits; |
|
AIM |
AIM, a market operated by the London Stock Exchange; |
|
AIM Rules |
the AIM Rules for Companies published by the London Stock Exchange; |
|
Allenby Capital |
Allenby Capital Limited, registered in England and Wales under number 06706681 whose registered office is at 5 St. Helens Place, London EC3A 6AB; |
|
Announcement |
this announcement regarding the Placing, including the Terms and Conditions in Appendix I; |
|
Board or the Directors |
the board of directors of the Company; |
|
Bookbuild |
the Placing made available to certain institutional and professional investors that will be conducted by way of an accelerated bookbuild and which will open immediately following release of this Announcement in accordance with the terms and conditions set out in Appendix I; |
|
Bookrunners |
Canaccord and Turner Pope (and "Bookrunner" shall mean either one of them); |
|
Canaccord |
Canaccord Genuity Limited registered in England and Wales under number 01774003 whose registered office is at 88 Wood Street 10th Floor, London EC2V 7QR; |
|
Circular |
the circular to Shareholders to be published by the Company explaining, inter alia, the Placing and incorporating notice of the General Meeting; |
|
Company or Zephyr |
Zephyr Energy Plc registered in England and Wales under number 04573663whose registered office is at 20-22 Wenlock Road, London, England, N1 7GU; |
|
CREST |
the computerised settlement system to facilitate transfer of the title to an interest in securities in uncertificated form operated by Euroclear; |
|
Director Shares |
the new Ordinary Shares issued pursuant to the Director Subscription; |
|
Director Subscription |
the subscription for the Director Shares at the Issue Price by certain Directors, management, and their affiliates; |
|
Euroclear |
Euroclear UK & International Limited; |
|
Fee Warrants |
the 20,000,000 warrants to be granted to the Bookrunners and agents to the Placing to subscribe for new Ordinary Shares, exercisable at the Issue Price per new Ordinary Share, for a period of five years from the date of Second Admission |
|
First Admission |
admission of the First Placing Shares to trading on AIM becoming effective as provided in Rule 6 of the AIM Rules; |
|
First Admission Settlement Date |
the date the settlement of transactions in the First Placing Shares following the First Admission will take place within the CREST system (subject to certain exceptions) which is expected to occur on 27 June 2025; |
|
First Placing |
the placing of the First Placing Shares at the Issue Price; |
|
First Placing Shares |
the 175,071,902 new Ordinary Shares to be issued pursuant to the first tranche of the Placing to Placees which are proposed to be admitted to trading on AIM at First Admission; |
|
FSMA |
the Financial Services and Markets Act 2000; |
|
General Meeting |
the general meeting of Shareholders to be held on 14 July 2025 at the offices of Haynes and Boone CDG LLP, 1 New Fetter Lane, London, EC4A 1AN, United Kingdom at 10.00 a.m. (or any reconvened meeting following adjournment of the general meeting); |
|
Issue Price |
3.0 pence per new Ordinary Share; |
|
London Stock Exchange |
London Stock Exchange plc; |
|
Long Stop Date |
29 July 2025; |
|
MAR |
the Market Abuse Regulation (EU Regulation No. 596/2014) as it forms part of UK domestic law by virtue of the European Union (Withdrawal) Act 2018; |
|
Notice of General Meeting |
the notice of the General Meeting contained within the Circular; |
|
Ordinary Shares |
ordinary shares of £0.01 each in the capital of the Company; |
|
Paradox project |
the Company's flagship project in the Paradox Basin, Utah, the United States; |
|
Placees |
the persons with whom Placing Shares are placed pursuant to the Placing; |
|
Placing |
the conditional placing of the Placing Shares by the Bookrunners on behalf of the Company at the Issue Price, in accordance with the Placing Agreement; |
|
Placing Agreement |
the conditional placing agreement relating to the Placing of the Placing Shares between the Company and the Bookrunners; |
|
Placing Shares |
the new Ordinary Shares to be issued for cash in connection with the Placing (being the First Placing Shares and/or the Second Placing Shares as the context admits); |
|
Proposed Acquisition |
the proposed acquisition of a portfolio of working interests in accretive, mature production and development assets in core Rocky Mountain basins, U.S.; |
|
Publicly Available Information |
information publicly announced through a Regulatory Information Service by or on behalf of the Company on or prior to the date of this Announcement; |
|
Prospectus Regulation |
Regulation (EU) 2017/1129 of the European Parliament and of the Council of 14 June 2017; |
|
Recorded Commitment |
a Placee's participation confirmed in and evidenced by either (i) a recorded telephone conversation or (ii) email correspondence, in either case between representatives of the respective Bookrunner to whom the Placee's commitment is given and the relevant Placee; |
|
Regulation S |
Regulation S under the Securities Act; |
|
Regulatory Information Service |
has the meaning given to it in the AIM Rules; |
|
Relevant Member State |
a member state of the European Economic Area which has implemented the Prospectus Regulation; |
|
Resolutions |
the resolutions contained in the Notice of General Meeting; |
|
Results |
the Company's audited results for the year ended 31 December 2024; |
|
Second Admission |
admission of the Second Placing Shares to trading on AIM becoming effective as provided in Rule 6 of the AIM Rules; |
|
Second Placing |
the placing of the Second Placing Shares at the Issue Price; |
|
Second Placing Shares |
the 134,928,098 new Ordinary Shares to be issued pursuant to the second tranche of the Placing to Placees which are proposed to be admitted to trading on AIM at Second Admission; |
|
Second Admission Settlement Date |
the date the settlement of transactions in the Second Placing Shares following Second Admission will take place within the CREST system (subject to certain exceptions) which is expected to occur on 15 July 2025; |
|
Shareholders |
holders of Ordinary Shares; |
|
State 36-2R or the well |
the State 36-2 LNW-CC-R well; |
|
Turner Pope |
Turner Pope Investments (TPI) Ltd registered in England and Wales under number 09506196 whose registered office is at 3 Queen Street, London, W1J 5PA; |
|
UK Prospectus Regulation |
Regulation (EU) 2017/1129 of the European Parliament and of the Council of 14 June 2017, as it forms part of the law of England and Wales by virtue of section 3 of the European Union (Withdrawal) Act 2018 and as modified by or under domestic law; |
|
United States or U.S. |
the United States of America, its territories and possessions, any state of the United States and the District of Columbia; and |
|
Williston project |
the Company's non-operated producing assets in the Williston Basin, North Dakota and Montana, U.S. |
|
|
|
|
|
|
|
|
|
APPENDIX III
GLOSSARY
|
"1C"
|
low estimate of Contingent Resources |
|
"2C"
|
best estimate of Contingent Resources |
|
"3C"
|
high estimate of Contingent Resources |
|
"1P"
|
proven reserves (both proved developed reserves + proved undeveloped reserves) |
|
"2P"
|
1P (proven reserves) + probable reserves, hence "proved and probable" |
|
"3P"
|
the sum of 2P (proven reserves + probable reserves) + possible reserves, all 3Ps "proven and probable and possible"
|
|
"ARO"
|
asset retirement obligation
|
|
"Bcf"
|
billion cubic feet |
|
"bo"
|
barrel of oil |
|
"boe"
|
barrels of oil equivalent |
|
"boepd"
|
barrels of oil equivalent per day |
|
"CAPEX"
|
capital expenditure |
|
"Contingent Resources"
|
those quantities of petroleum estimated, as of a given date, to be potentially recoverable from known accumulations by application of development projects, but which are not currently considered to be commercially recoverable due to one or more contingencies. Contingent Resources may include, for example, projects for which there are currently no viable markets, or where commercial recovery is dependent on technology under development, or where evaluation of the accumulation is insufficient to clearly assess commerciality. Contingent Resources are further categorised in accordance with the level of certainty associated with the estimates and may be sub-classified based on project maturity and/or characterised by their economic status
|
|
"CPR"
|
competent Person's Report |
|
"DUCs"
|
drilled but uncompleted wells |
|
"EBITDA"
|
earnings before interest, taxes, depreciation, and amortization |
|
"GIIP"
|
gas initially in place |
|
"IRR"
|
internal rate of return |
|
"P50"
|
50% probability (that quantities actually recovered will equal or exceed the best estimate) |
|
"P&A"
|
plug and abandon |
|
"PDP"
|
proved developed producing |
|
"PUD"
|
proved but undeveloped well |
|
"PV-10"
|
net present value at a 10% discount |
|
"Reserves"
|
reserves are defined as those quantities of petroleum which are anticipated to be commercially recovered from known accumulations from a given date forward |
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