TIDMAFHP TIDMAFHB
RNS Number : 7438D
AFH Financial Group Plc
28 June 2019
THIS ANNOUNCEMENT, INCLUDING THE APPICES AND THE INFORMATION
CONTAINED HEREIN IS RESTRICTED AND NOT FOR RELEASE, PUBLICATION OR
DISTRIBUTION, IN WHOLE OR IN PART, DIRECTLY OR INDIRECTLY, IN OR
INTO THE UNITED STATES, AUSTRALIA, CANADA, JAPAN, NEW ZEALAND, THE
REPUBLIC OF SOUTH AFRICA OR ANY OTHER JURISDICTION IN WHICH
RELEASE, PUBLICATION OR DISTRIBUTION WOULD BE UNLAWFUL. PLEASE SEE
THE IMPORTANT NOTICES AT THE OF THIS ANNOUNCEMENT.
THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION FOR THE PURPOSES
OF ARTICLE 7 OF EU REGULATION 596/2014.
28 June 2019
AFH FINANCIAL GROUP PLC
("AFH" or the "Company")
Proposed Conditional Placing of Convertible Unsecured Loan
Stock
AFH Financial Group plc (AIM: AFHP), a leading financial
planning led wealth management firm, announces that it proposes to
raise up to GBP20 million through a conditional placing ("Placing")
of 4.0 per cent. convertible unsecured loan stock 2024 ("CULS") in
denominations of GBP5,000 nominal each and in integral multiples of
GBP5,000 in excess thereof. The Company intends to apply for
admission of the CULS to trading on the International Securities
Market operated by the London Stock Exchange.
Summary of the Placing
-- Placing of CULS to raise up to GBP20 million for the Company,
subject to Shareholder approval at a general meeting of the Company
to be held on 29 July 2019 (the "General Meeting").
-- Net proceeds of the Placing to be used to execute the
Company's acquisition pipeline and for general corporate purposes.
The Company currently has a strong pipeline of potential
acquisitions under consideration and due diligence.
-- Liberum Capital Limited ("Liberum") and Shore Capital
Stockbrokers Limited ("Shore Capital") have been appointed as Joint
Placing Agents in connection with the Placing.
-- The Placing will be conducted by way of a Bookbuild and is
expected to close at 12.00 p.m. (London time) on 11 July 2019, but
may be closed earlier or later at the discretion of the Company,
Liberum and Shore Capital.
-- Books for the Placing are open with immediate effect.
Reasons for the Placing and Use of Proceeds
The Board considers that the issue of the CULS will provide:
-- long-term structural gearing at a fixed cost that is
competitive with the cost of other forms of gearing that the
Company might have employed and which has the potential to be
converted into the permanent capital base of the Company;
-- additional funds available for investment which, as the
initial Conversion Price is at a premium to the market price of
Ordinary Shares, reduces the dilution of current Shareholders than
would otherwise be the case on an equity fundraising at the
existing market price;
-- relative to other forms of gearing, a close alignment of
interests between CULS Holders and those of Shareholders, through
being convertible into Ordinary Shares in the future and relatively
long-term in nature; and
-- following any conversion of CULS:
o an increased number of Ordinary Shares in issue, which should,
in due course, enhance the liquidity in the market for the Ordinary
Shares; and
o a wider Shareholder base for the Company to support its growth
ambitions.
Alongside its strategy to drive organic growth, the Board
intends to continue to execute its strategy of making selective
acquisitions within the Financial Planning and Wealth Management
sector whilst providing a professional and cost-effective service
to its clients. The Board believes that the Company remains well
positioned to take advantage of consolidation opportunities in the
sector and currently has a strong near-term pipeline, with five
potential acquisitions currently at various stages of the due
diligence process. The Company is undertaking the Placing to
provide it with a strong platform to finance such acquisition
opportunities as well as providing funds for general corporate
purposes. The Company is also currently exploring options to access
additional capital, including the use of bank debt, to enhance its
ability to undertake value-adding acquisitions and for general
corporate purposes.
The Company also considers that the Placing will provide CULS
Holders with:
-- an attractive yield of 4.0 per cent. per annum;
-- capital protection through repayment at par (to the extent
the CULS have not been redeemed, purchased or converted into
Ordinary Shares); and
-- the potential to participate in further growth of the Company
through the ability to convert the CULS into new Ordinary Shares
over the next five years (to the extent the CULS have not already
been converted into Ordinary Shares).
Summary of the terms of the CULS
The interest rate on the CULS will be 4.0 per cent. per annum
(less any deduction or withholding required by law), payable semi
annually in equal instalments in arrears on 30 June and 31 December
in each year with the first interest payment on 31 December 2019 in
respect of the period from Admission (expected to be 30 July 2019)
to 31 December 2019.
CULS Holders will be able to convert their CULS into Ordinary
Shares on a quarterly basis throughout the life of the CULS
commencing on 31 December 2019 with the final conversion date being
on 30 June 2024. All outstanding CULS will be repayable at par
(plus any accrued interest) on 30 July 2024 ("Final Maturity
Date"). The initial Conversion Price will be 420 pence ("Conversion
Price"), representing a 16.67 per cent. premium to the Mid Market
Price of the Ordinary Shares of 360 pence on 27 June 2019. Based on
the initial Conversion Price, a holder of GBP5,000 nominal of CULS
would be entitled to 1,190 Ordinary Shares on conversion of their
CULS. Under the terms of the Trust Deed, the Conversion Price will
be subject to subsequent adjustment on the occurrence of certain
events.
At any time during the 30 day period commencing 40 days prior to
the Final Maturity Date and expiring 10 days prior to the Final
Maturity Date ("Compulsory Conversion Period") the Company will be
entitled to require remaining CULS Holders to convert their
outstanding CULS into Ordinary Shares by giving the CULS Holders
notice in writing ("Compulsory Conversion Notice") provided that
the Mid Market Price is, for at least 20 dealing days during the
period of 30 consecutive dealing days immediately prior to the date
of the Compulsory Conversion Notice, at least 20 per cent. above
the Conversion Price prevailing at the start of such 30 day period.
For the avoidance of doubt, the 30 dealing days referred to must
expire during the Compulsory Conversion Period. In the event of
such Compulsory Conversion Notice being given as aforesaid each
CULS Holder shall be deemed to have exercised their Conversion
Rights on the date of the Compulsory Conversion Notice at such
Conversion Price prevailing at the start of such 30 dealing day
period referred to above.
Any CULS not previously redeemed, purchased or converted will be
repaid by the Company on the
Final Maturity Date at its nominal amount plus accrued
interest.
A summary of the terms of the CULS is set out in Appendix I
below.
Outlook and current trading
On 28 May 2019, the Company released its interim results for the
six month period ended 30 April 2019. In those results, the Chief
Executive of the Company stated:
"I am pleased to report another set of strong results for the
first half of 2019 demonstrating our progress as we continue to
build ourselves into the leading financial planning-led wealth
manager in the UK. Despite turbulence in the equity markets and
subdued investor confidence over the period, we have delivered
increased revenues, reporting 61% growth from the previous period
to GBP36.6 million and improved trading margins demonstrated by our
underlying EBITDA[1] margin increasing to 21.0%.
Our growth continues to be generated organically from new and
existing clients together with the benefits of the four
acquisitions made in the first half of FY 2019 as well as those
acquisitions made towards the end of 2018. Our protection business,
which is not aligned to the stock markets, continued the strong
growth reported in 2018.
Following the Company's success in meeting its strategic and
financial aspirations set out in January 2017, the Board set new
aspirational targets in January 2019 to be achieved within a three
to five-year period.
The overarching strategy of the Company continues to be to
generate long term value for shareholders by driving revenue growth
and margin expansion while providing exceptional value and service
to our clients, using our increasing size to drive down platform
and fund management charges aligned to an appropriate risk-based
investment model.
On the basis of our results and the opportunities identified, we
look forward to continuing to deliver continued profitable growth
in the second half of 2019 and beyond."
The Board has also set new aspirations to be achieved within a
three to five year timeframe:
-- funds under management of GBP10 billion;
-- revenues of GBP140 million per annum; and
-- underlying EBITDA margin of 25 per cent. of revenue.
There has been no material change in the outlook or trading of
the Company since the release of its interim results.
Details of the Placing
Liberum and Shore Capital are acting as Joint Placing Agents in
connection with the Placing.
The Placing is being conducted by way of a Bookbuild process and
will be launched immediately following the release of this
Announcement and will be made available to eligible new and
existing institutional investors. The final number of CULS to be
issued pursuant to the Placing will be agreed between the Company
and the Joint Placing Agents following close of the Placing and
will be announced shortly thereafter. The Placing size may be
increased or decreased at the discretion of the Company and the
Joint Placing Agents. The book will close at the sole discretion of
the Joint Placing Agents.
The Placing is subject to the terms and conditions set out in
Appendix II to this Announcement (which, together with the summary
of the CULS set out in Appendix I and the definitions set out in
Appendix III, forms part of this Announcement, such Announcement
and Appendices together being, this "Announcement"). The Placing is
not being underwritten. The Placing is subject, inter alia, to
Shareholder approval at the General Meeting to issue the CULS and
disapply statutory pre-emption rights in respect of the issue of
the CULS.
By choosing to participate in the Placing and by making an oral
and/or written legally binding offer to acquire CULS, investors
will be deemed to have read and understood this Announcement in its
entirety, including Appendix II, and to be making such offer on the
terms and subject to the conditions contained herein and to be
making the representations, warranties, undertakings and
acknowledgements contained in Appendix II.
Appendix I sets out a summary of the terms of the CULS. Appendix
II and Appendix III set out further information relating to the
Placing and the terms and conditions of the Placing. Unless
otherwise defined in the terms and conditions, capitalised terms
used in this Announcement shall have the meaning given to them in
Appendix III.
The Company intends, on or around 12 July 2019, to publish
Admission Particulars in connection with the admission of the CULS
to trading on the International Securities Market, a market
operated by the London Stock Exchange. Those Admission Particulars
will also include the notice of the General Meeting.
Enquiries:
AFH Financial Group PLC 01527 577 775
Alan Hudson, Chief Executive Officer
Paul Wright, Chief Financial Officer
Liberum (Nominated Adviser and Joint Placing Agent) 020 3100 2000
John Fishley / Richard Bootle / Euan Brown / Kane Collings
Shore Capital (Joint Placing Agent) 020 7408 4090
Hugh Morgan / Edward Mansfield / Daniel Bush
Yellow Jersey PR Limited (Financial PR) 077 4884 3871
Felicity Winkles / Tim Thompson / Annabel Atkins
Important Notices
This Announcement contains forward-looking statements, including
but not limited to statements about the Company's future plans and
prospects. By their nature, forward-looking statements involve
risks and uncertainties because they relate to events and depend on
circumstances that may or may not occur in the future and therefore
are based on current beliefs and expectations about future events.
Forward-looking statements are not guarantees of future performance
and actual operating results and financial condition, and the
development of the industry in which the Company operates may
differ materially from those made in or suggested by the
forward-looking statements contained in this Announcement.
Accordingly, prospective investors should not rely on these
forward-looking statements. The Company disclaims any intention or
obligation to update or revise any forward-looking statements,
whether as a result of new information, future events or otherwise.
None of the Company, the Directors or the Joint Placing Agents
undertake any obligation nor do they intend to revise or update any
document unless required to do so by applicable law or
regulation.
This Announcement and the information contained in it is
restricted and is not for release, publication or distribution,
directly or indirectly, in whole or in part, in, into or from the
United States (including its territories and possessions, any state
of the United States or any Excluded Jurisdiction or any other
jurisdiction where to do so might constitute a violation of local
securities laws or regulations. The information in this
Announcement may not be forwarded or distributed to any other
person and may not be reproduced in any manner whatsoever. Any
forwarding, distribution, reproduction, or disclosure of this
information in whole or in part is unauthorised. Failure to comply
with this directive may result in a violation of the US Securities
Act of 1933, as amended ("Securities Act") or the applicable laws
of other jurisdictions.
This Announcement is for information purposes only and does not
constitute an offer or invitation to sell or issue or the
solicitation of an offer to buy, acquire or subscribe for CULS to
or by anyone in any Excluded Jurisdiction or to any person to whom
it is unlawful to make such offer or invitation or undertake such
solicitation. Any failure to comply with these restrictions may
constitute a violation of the securities laws of such
jurisdictions. Subject to certain exceptions, the CULS may not be
offered or sold in any Excluded Jurisdiction or to, or for the
account or benefit of any national resident or citizen of any
Excluded Jurisdiction. This Announcement does not constitute an
extension into the United States of the offer mentioned in this
Announcement, nor does it constitute nor form part of an offer to
sell securities or the solicitation of an offer to buy securities
in the United States. The CULS have not been and will not be
registered under the Securities Act or under any securities laws or
with any securities regulatory authority of any state or other
jurisdiction of the United States. The CULS may not be offered,
sold, resold, taken up, transferred, delivered or distributed,
directly or indirectly, into or within the United States absent
registration under the Securities Act or an available 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. There will be no public offer of the CULS in the
United States.
The distribution of this Announcement and the offering of the
CULS in certain jurisdictions other than the United Kingdom may be
restricted by law. Subject to certain exceptions, no action has
been taken by the Company or the Joint Placing Agents that would
permit an offering of the CULS or possession or distribution of
this Announcement or any other offering or publicity material
relating to the CULS in the Excluded Jurisdictions or in any other
jurisdiction where action for that purpose is required. Persons
into whose possession this Announcement comes are required by the
Company or the Joint Placing Agents to inform themselves about, and
to observe, any such restrictions.
This Announcement has been issued by, and is the sole
responsibility of, the Company. No representation or warranty,
express or implied, is or will be made as to, or in relation to,
and no responsibility or liability is or will be accepted by the
Joint Placing Agents or by any of their respective affiliates or
agents as to or in relation to, the accuracy or completeness of
this Announcement or any other written or oral information made
available to or publicly available to any interested party or its
advisers, and any liability therefore is expressly disclaimed.
The Joint Placing Agents, each of which is authorised and
regulated in the United Kingdom by the FCA, are each acting
exclusively for the Company and no one else in connection with the
Placing and will not regard any other person (whether or not a
recipient of this Announcement) as a client in relation to the
Placing and will not be responsible to anyone other than the
Company for providing the protections afforded to their respective
clients, nor for providing advice, in relation to the Placing or
any other matter referred to in this Announcement.
Apart from the responsibilities and liabilities, if any, which
may be imposed on the Joint Placing Agents by the FSMA or the
regulatory regime established thereunder, the London Stock
Exchange, the Rules of the International Securities Market, or
under the regulatory regime of any jurisdiction where exclusion of
liability under the relevant regulatory regime would be illegal,
void or unenforceable, neither the Placing Agents, nor any of their
respective affiliates, directors, officers, employees, advisers,
representatives or agents accept any responsibility whatsoever for,
or makes any representation or warranty, express or implied, as to
the contents of this Announcement, including its accuracy or
completeness or for any other statement made or purported to be
made by it or on behalf of it, the Company, the Directors or any
other person, in connection with the Company, the CULS, the Placing
or Admission, and nothing in this Announcement should be relied
upon as a promise of representation in this respect, whether as to
the past or the future. Each of the Joint Placing Agents, and their
respective affiliates, directors, officers, employees, advisers,
representatives or agents, accordingly disclaims to the fullest
extent permitted by law all and any responsibility or liability
whatsoever, whether arising in tort, contract or otherwise (save as
referred to above), which it might otherwise have in respect of
this Announcement or any such statement.
Statements contained in this Announcement regarding past trends
or activities should not be taken as a representation that such
trends or activities will continue in the future.
No statement in this Announcement is or is intended to be a
profit forecast or profit estimate or to imply that the earnings of
the Company for the current or future financial years will
necessarily match or exceed the historical or published earnings of
the Company. The price of shares and securities and the income from
them may go down as well as up and investors may not get back the
full amount invested on disposal of the shares or securities.
The CULS to be issued pursuant to the Placing will not be
admitted to trading on any stock exchange other than on the London
Stock Exchange's International Securities Market.
Neither the content of the Company's website nor any website
accessible by hyperlinks on the Company's website is incorporated
in, or forms part of, this Announcement.
Information for distributors:
Solely for the purposes of the product governance requirements
contained within: (a) EU Directive 2014/65/EU on markets in
financial instruments, as amended ("MiFID II"); (b) Articles 9 and
10 of Commission Delegated Directive (EU) 2017/593 supplementing
MiFID II; and (c) local implementing measures (together, the "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 securities the subject of the Placing have been subject to a
product approval process, which has determined that such securities
are: (i) compatible with an end target market of eligible
counterparties and professional clients only, each as defined in
MiFID II and (ii) all channels for distribution of the securities
to eligible counterparties and professional clients are
appropriate. Any person subsequently offering, selling or
recommending the securities (a "Distributor") should take into
consideration the manufacturer's target market assessment; however,
a distributor subject to MiFID II is responsible for undertaking
its own target market assessment in respect of the securities and
determining appropriate distribution channels.
The target market assessment is without prejudice to the
requirements of any contractual, legal or regulatory selling
restrictions in relation to the Placing.
For the avoidance of doubt, the target market assessment does
not constitute: (a) an assessment of suitability or appropriateness
for the purposes of MiFID II; or (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 securities.
The securities are not intended to be offered, sold or otherwise
made available to and should not be offered, sold or otherwise made
available to any retail investor in the EEA.
For these purposes, a retail investor means a person who is one
(or more) of: (i) a retail client as defined in point (11) of
article 4(1) of MiFID II; or (ii) a customer within the meaning of
EU Directive 2002/92/EC, where that customer would not qualify as a
professional client as defined in point (10) of article 4(1) of
MiFID II. Consequently, no key information document required by EU
regulation no 1286/2014, as amended (the "PRIIPs regulation") for
offering or selling the securities or otherwise making them
available to retail investors in the EEA has been prepared and
therefore offering or selling the securities or otherwise making
them available to any retail investor in the EEA may be unlawful
under the PRIIPs regulation.
Appendix I
Summary of the CULS
The following summary of the CULS has been extracted from the
Placing Proof without material amendment.
The Trust Deed will contain provisions, inter alia, to the
following effect:
1 Definitions
In addition to the defined terms set out in Appendix III and
otherwise defined in this Announcement the following additional
definitions apply for the purpose of this Appendix I:
"Expert" means a financial adviser (which may, for the avoidance
of doubt, be the auditors for the time being of the Company)
appointed by the Company and approved in writing by the Trustee
(such approval not to be unreasonably withheld or delayed) or, if
the Company fails to make such appointment and such failure
continues for a reasonable period (as determined by the Trustee),
appointed by the Trustee following notification to the Company and
provided that the Trustee has no obligation to make such
appointment unless it has been indemnified and/or provided with
security and/or pre-funded to its satisfaction in respect of all
costs, fees and expenses of such adviser and of the Trustee in
connection with such appointment;
"Further CULS" means further unsecured loan stock of the Company
issued pursuant to the provisions described in paragraph 13 and
constituted by a trust deed supplemental to the Trust Deed;
"Relevant Electronic System" means any computer-based system
enabling title to units of CULS to be evidenced and transferred
without a written instrument;
"subsidiary" means any company which is for the time being a
subsidiary (within the meaning of section 1159 of the Companies
Act) of the Company; and
"Uncertificated Conversion Notice" means a properly
authenticated dematerialised instruction and/or other instruction
or notification received by the Company (or by such person as it
may require for these purposes) in such form and subject to such
terms and conditions as may from time to time be prescribed by the
Company (subject always to the CREST Regulations and the
facilities, rules and requirements of the Relevant Electronic
System) and that specifies (in accordance with the form prescribed
by the Company) the nominal amount of CULS in respect of which the
Conversion Rights are being exercised.
References in this Appendix I to "paragraphs" are to paragraphs
of this Appendix I.
2 Interest
2.1 The CULS will bear interest (which shall accrue from day to
day) on the nominal amount of the CULS at the rate of 4.0 per cent.
per annum (less any deduction or withholding required by law) such
interest to be payable semi annually in equal instalments in arrear
on 30 June and 31 December in each year (each an "Interest Payment
Date"), save that the first payment of interest on the CULS, which
will be made on 31 December 2019 (the "First Interest Payment
Date"), will be in respect of the period from and including the
Issue Date to (but excluding) 31 December 2019 and the final
payment of interest on the CULS (the "Final Interest Payment Date")
will be in respect of the period from (and including) the Interest
Payment Date immediately preceding the Final Maturity Date to (but
excluding) the Final Maturity Date.
2.2 The amount of interest payable in respect of any period
which is either shorter or longer than an Interest Period (as
defined below) shall be calculated at (i) the rate of 4.0 per cent.
per annum divided by two multiplied by (ii) the number of calendar
days in the relevant period from (and including) the first day of
such period to (but excluding) the last day of such period divided
by the number of calendar days in the Interest Period in which the
relevant period falls.
"Interest Period" means each period from (and including) an
Interest Payment Date to (but excluding) the next successive
Interest Payment Date and, for the purposes of this definition, the
first Interest Period shall be 30 June 2019 to 30 December 2019 and
the final Interest Period shall be 30 June 2024 to 30 December
2024.
3 Conversion
3.1 Each CULS Holder (and for the purposes of paragraph 5 the
Trustee and for the purposes of paragraph 3.3 the Company, on his
behalf) shall (on and subject to the provisions herein) have the
right to convert the whole or such part (being an integral multiple
of GBP5,000 nominal) of his or her CULS as he or she may specify
into fully paid Ordinary Shares. The number of Ordinary Shares to
be issued by the Company on the exercise of a Conversion Right
shall be determined by dividing the nominal amount of the CULS to
be converted by the conversion price in effect on the relevant
Conversion Date ("Conversion Price"). The initial Conversion Price
is 420 pence per Ordinary Share (which shall be subject to
adjustment in circumstances described in paragraph 4).
3.2 Conversion at the option of CULS Holders. The Conversion
Rights shall be exercisable (in the manner described in paragraph
3.4 or paragraph 3.5, as applicable) at any time during the periods
of 28 days ending 31 March, 30 June, 30 September and 31 December
each year commencing 28 days prior to 31 December 2019 and ending
28 days prior to 30 June 2024 (each such period and any other
period during which the Conversion Rights may be exercised a
"Conversion Period") provided that the documents or notifications
required are received by 6.00 pm on the last day of the relevant
Conversion Period (each such last day a "Conversion Date" and the
final Conversion Date falling on 30 June 2024 being the "Final
Conversion Date").
3.3 Conversion at the option of the Company. At any time during
the Compulsory Conversion Period the Company will be entitled to
require all remaining CULS Holders to convert all their outstanding
CULS into Ordinary Shares by giving the CULS Holders notice in
writing ("Compulsory Conversion Notice") provided that the Mid
Market Price is, for at least 20 dealing days during the period of
30 consecutive dealing days immediately prior to the date of the
Compulsory Conversion Notice, at least 20 per cent. above the
Conversion Price prevailing at the start of such 30 day period. For
the avoidance of doubt, the 30 dealing days referred to in this
paragraph must expire during the Compulsory Conversion Period. In
the event of such Compulsory Conversion Notice being given as
aforesaid, each CULS Holder shall be deemed to have exercised their
Conversion Rights on the date of the Compulsory Conversion Notice
at such Conversion Price prevailing at the start of such 30 dealing
day period referred to above (and the provisions of paragraph 3.12
shall apply accordingly). The date of the deemed exercise of the
Conversion Rights pursuant to this paragraph 3.3 shall be deemed to
be a Conversion Date and the provisions of paragraphs 3.4 and 3.5
shall not apply. The Company shall have the right to issue any
Ordinary Shares arising on conversion pursuant to this paragraph
3.3 in certificated form.
A certificate signed by the Directors as to the Mid Market Price
may be relied upon by the Trustee as sufficient evidence thereof
and, if so relied upon, shall (in the absence of manifest error) be
binding on all parties.
3.4 Subject to paragraph 3.3, in order to exercise, in whole or
in part, the Conversion Rights which are conferred by any CULS that
is on the relevant Conversion Date in certificated form, the CULS
Holder must lodge the relevant CULS certificate(s) (or such other
document(s) as the Company may, in its absolute discretion, accept)
at the office of the Company's registrars specified in the CULS
certificate (or at such other place as the Company may from time to
time notify the CULS Holders) during the relevant Conversion Period
having completed and signed the notice of exercise of Conversion
Rights thereon (a "Conversion Notice") (or by giving such other
notice of exercise of Conversion Rights as the Company may, in its
absolute discretion, accept). The Company may (at its sole
discretion) accept as valid notices of exercise of Conversion
Rights which are received after the relevant Conversion Date. Once
lodged, a notice of exercise of Conversion Rights shall be
irrevocable, save with the consent of the Company. Compliance must
also be made with any statutory and regulatory requirements for the
time being applicable.
3.5 Subject to paragraph 3.3, in order to exercise, in whole or
in part, the Conversion Rights which are conferred by any CULS that
is on the relevant Conversion Date in uncertificated form shall be
exercisable, in whole or in part, (and treated by the Company as
exercised) on that Conversion Date if an Uncertificated Conversion
Notice is received as referred to below during the Conversion
Period (but not later than the latest time for input of the
instruction permitted by the Relevant Electronic System on that
date) by the Company's Regulators (or by such person as it may
require for such purposes) in such form and subject to such terms
and conditions as may from time to time be prescribed by the
Company (subject always to the CREST Regulations and the
facilities, rules and requirements of the Relevant Electronic
System concerned). The Company may, in addition but subject to the
CREST Regulations and the facilities, rules and requirements of the
Relevant Electronic System, determine when any such properly
authenticated dematerialised instruction and/or other instruction
or notification is to be treated as received by the Company (or by
such other person as it may require for these purposes). Without
prejudice to the generality of the foregoing, the effect of an
Uncertificated Conversion Notice may be such as to divest the
holder of the CULS concerned of the power to transfer such CULS to
another person. Once lodged, an Uncertificated Conversion Notice
shall be irrevocable, save with the consent of the Company.
Compliance must also be made with any statutory and regulatory
requirements for the time being applicable.
3.6 Fractions of Ordinary Shares will not be issued on exercise
of Conversion Rights, and no payment of cash or other adjustment
will be made in lieu thereof. Fractional entitlements will be
rounded down.
3.7 The Company shall notify all CULS Holders via a Regulatory
Information Service not less than four nor more than eight weeks
prior to each Conversion Date (other than deemed Conversion Dates
under paragraphs 3.3, 3.14 and 5) reminding them of their
Conversion Rights then arising or current and stating the relevant
basis of conversion (including the Conversion Price) (after taking
into account any appropriate adjustments pursuant to Condition 4).
Such notice shall give the address of the Registrars.
3.8 Ordinary Shares allotted pursuant to the exercise (or deemed
exercise) of Conversion Rights which are conferred by any CULS that
is in certificated form will be allotted not later than 14 days
after, and with effect from, the relevant Conversion Date to the
CULS Holder credited as fully paid and such allotment and issue
shall (subject to any amount of accrued interest to which he or she
may be entitled under the provisions of paragraph 3.12) be in full
satisfaction and discharge of the principal moneys in respect of
the CULS so converted.
3.9 The Company shall not later than the expiry of 28 days next
following the relevant Conversion Date send, or procure to be sent,
free of charge (at the risk of the person(s) entitled thereto)
certificates in respect of Ordinary Shares allotted pursuant to the
exercise (or deemed exercise) of Conversion Rights which are
conferred by any CULS held in certificated form to the person(s) in
whose name(s) the CULS is registered at the date of exercise (and,
if more than one, to the first-named, which shall be sufficient
despatch for all). In the event of partial exercise of the
Conversion Rights evidenced by a Certificate, the Company shall, at
the same time, issue a new Certificate in the name of the holder
for the balance of that holder's CULS not converted.
3.10 Ordinary Shares allotted pursuant to the exercise of
Conversion Rights which are conferred by any CULS that is in
uncertificated form will be allotted not later than 14 days after,
and with effect from, the relevant Conversion Date to the CULS
Holder credited as fully paid and such allotment and issue shall
(subject to any amount of accrued interest to which he or she may
be entitled under the provisions of paragraph 3.12) be in full
satisfaction and discharge of the principal moneys in respect of
the CULS so converted. The Company shall procure that the
appropriate instructions are given to enable such Ordinary Shares
to be evidenced by means of the Relevant Electronic System as a
holding of the person(s) in whose name(s) the CULS in respect of
which Conversion Rights have been exercised were registered at the
date of such exercise.
3.11 For the avoidance of doubt, unless the Company otherwise
determines or unless the CREST Regulations or the facilities, rules
or requirements of the Relevant Electronic System otherwise
require, the Ordinary Shares issued on the exercise of Conversion
Rights shall be issued in certificated form where such Conversion
Rights were conferred by CULS which was held in certificated form
and in uncertificated form where such Conversion Rights were
conferred by CULS which was held in uncertificated form.
3.12 Interest on CULS converted under this paragraph 3 shall be
payable up to but excluding, but shall cease to accrue immediately
after, the relevant Conversion Date (whether or not this is an
Interest Payment Date in respect of the CULS). Ordinary Shares
allotted on conversion shall be credited as fully paid. Such
Ordinary Shares will not rank for any dividends or other
distributions declared, paid or made on the Ordinary Shares by
reference to a record date before the relevant Conversion Date,
but, subject thereto, will rank in full for all dividends and other
distributions declared, paid or made on the Ordinary Shares by
reference to a record date on or after the relevant Conversion Date
and otherwise will rank pari passu in all other respects, and form
one class, with the Ordinary Shares in issue on the relevant
Conversion Date.
3.13 Without prejudice to the generality of the final sentence
of paragraph 3.4 and 3.5, the exercise of Conversion Rights by any
CULS Holder (save in respect of a QIB) whose registered address is
in an Excluded Jurisdiction or who is a citizen or national of, or
resident in, an Excluded Jurisdiction or a custodian, nominee or
trustee for a citizen or national of, or resident in, an Excluded
Jurisdiction (including without limitation any US Person), and the
right of such a CULS Holder to receive the Ordinary Shares falling
to be issued to him following the exercise of his or her Conversion
Rights, will be subject to such requirements, conditions,
restrictions, limitations or prohibitions as the Company may at any
time impose, in its absolute discretion, for the purpose of
complying with any applicable securities laws of the relevant
jurisdiction, which, in the case of the United States, shall
include the US Securities Act and any rules or regulations
promulgated under such acts. As used in this document, "US Person"
means any person or entity defined as such in Rule 902(k) under the
US Securities Act, and without limiting the generality of the
foregoing, US Person includes a natural person resident in the
United States, a corporation or partnership organised or
incorporated under the laws of the United States (including any
State thereof) and an estate or trust, if any executor,
administrator or trustee is a US Person, but shall not include a
branch or agency of a US Person located outside the United States
if such agency or branch operates for valid business reasons and is
engaged in the business of insurance or banking and is subject to
substantive insurance or banking regulation, respectively, in the
jurisdiction where located.
3.14 Conversion by Trustee
The Trustee may, at its absolute discretion and without any
responsibility for any loss occasioned thereby, at any time during
the period of ten days before the Final Maturity Date (or such
earlier date as all the CULS then outstanding shall be due to be
redeemed by the Company) (the "Trustee Conversion Period"),
exercise all Conversion Rights not exercised by CULS Holders (or
deemed to be exercised pursuant to these Conditions) on or before
the Trustee Conversion Period at the Conversion Price applicable on
the date of commencement of the Trustee Conversion Period and sell
for the benefit of the CULS Holders entitled thereto the Ordinary
Shares allotted on such conversion, provided that the Trustee shall
not exercise such Conversion Rights unless an Expert (acting as an
expert and not an arbitrator) shall have stated in writing that in
its opinion the exercise of such Conversion Rights and prompt sale
by the Trustee would be in the interests of the CULS Holders
concerned as a body and provided further that the Trustee shall not
exercise such Conversion Rights in respect of any CULS whose holder
has requested redemption thereof. The period of ten days referred
to in this paragraph 3.14 shall be deemed to be a Conversion Period
and the date of exercise of such Conversion Rights by the
Trustee shall be deemed to be a Conversion Date and the
provisions of paragraph 3.12 shall apply accordingly.
4 Adjustments of the Conversion Price
4.1 The Conversion Price shall from time to time be adjusted in
accordance with the provisions of this paragraph 4.
4.2 Definitions
The following expressions shall, save as otherwise provided,
have the following meanings in this paragraph 4:
"Average Mid Market Price" means the average of the Mid Market
Price on each of the five consecutive dealing days up to and
including the Effective Date;
"Fair Market Value" means the fair market value as determined by
an Expert on the basis of a commonly accepted market valuation
method and taking into account such factors as the Expert considers
appropriate;
"Securities" means any securities, including without limitation
the Ordinary Shares and any other shares in the capital of the
Company and options, warrants or other rights to subscribe for or
purchase or acquire Ordinary Shares or any other shares in the
capital of the Company;
"Relevant Stock Exchange" means AIM or, if at the relevant time
the Ordinary Shares are not at that time listed and admitted to
trading on AIM, the principal stock exchange or securities market
on which the Ordinary Shares are then listed, admitted to trading
or quoted or dealt in.
4.3 Consolidation, sub-division or reclassification of Ordinary Shares
If and whenever there shall be a consolidation, sub-division or
reclassification of the Ordinary Shares, the Conversion Price shall
be adjusted by multiplying the Conversion Price in force
immediately before such alteration by the following fraction:
A
B
where:
A is the number of Ordinary Shares in issue immediately before such alteration; and
B is the number of Ordinary Shares in issue immediately after such alteration.
Such adjustment shall become effective on the date the
alteration takes effect.
4.4 Capitalisation issue
If and whenever the Company shall allot to holders of Ordinary
Shares any Ordinary Shares credited as fully paid by way of
capitalisation of reserves or profits (including any share premium
account or capital redemption reserve) other than Ordinary Shares
(in an amount equal to the amount of the cash dividend foregone)
issued in lieu of a cash dividend on a date (or by reference to a
record date) on or before the Final Maturity Date, the Conversion
Price shall be adjusted by multiplying the Conversion Price in
force immediately before such issue by the following fraction:
A
B
where:
A is the number of Ordinary Shares in issue immediately before such issue; and
B is the number of Ordinary Shares in issue immediately after such issue.
Such adjustment shall become effective on the date of issue of
such Ordinary Shares.
4.5 Relevant Dividend
If the Company declares or pays dividends per Ordinary Share
("Relevant Dividend") to holders of Ordinary Shares of an amount
exceeding 50 per cent. of the amount of audited statutory fully
diluted earnings per Ordinary Share for a financial year ("Dividend
Threshold"), the Conversion Price shall be adjusted downwards by
multiplying the Conversion Price in force immediately prior to the
Effective Date by the following fraction:
A - B
A - C
Where:
A is the Average Mid Market Price of the Ordinary Shares on the Effective Date;
B is the portion of the Fair Market Value of the Relevant
Dividend attributable to one Ordinary Share, with such portion
being determined by dividing the Fair Market Value of the Relevant
Dividend by the number of Ordinary Shares entitled to receive the
Relevant Dividend;
C is the amount (if any) by which the Dividend Threshold is
exceeded in respect of the relevant financial year.
For the purposes of the above Fair Market Value shall be
determined as at the Effective Date.
In making any calculations for the purposes of this paragraph
4.5, such adjustments (if any) shall be made as an Expert may
determine in good faith to be appropriate to reflect any
consideration or subdivision of Ordinary Shares or the issue of
Ordinary Shares by way of capitalisation of profits or reserves (or
any like or similar event) or any change in the number of Ordinary
Shares in issue in the relevant financial year.
Such adjustment shall become effective on the Effective
Date.
"Effective Date" means, in respect of this paragraph 4.5, the
first date on which the Ordinary Shares are traded ex-the Relevant
Dividend on the Relevant Stock Exchange.
4.6 Rights Issues - Ordinary Shares
If and whenever the Company shall issue Ordinary Shares to
Shareholders as a class by way of rights, or shall issue or grant
to Shareholders as a class by way of rights, any options, warrants
or other rights to subscribe for or purchase or otherwise acquire
any Ordinary Shares, or any Securities which by their terms of
issue carry (directly or indirectly) rights of conversion into, or
exchange or subscription for any Ordinary Shares (or shall grant
any such rights in respect of existing Securities so issued), in
each case at a price per Ordinary Share which is less than 90 per
cent. of the Mid Market Price per Ordinary Share on the Effective
Date, the Conversion Price shall be adjusted by multiplying the
Conversion Price in force immediately prior to the Effective Date
by the following fraction:
A + B
A + C
where:
A is the number of Ordinary Shares in issue on the Effective Date;
B is the number of Ordinary Shares which the aggregate
consideration (if any) receivable for the Ordinary Shares issued by
way of rights, or for the Securities issued by way of rights or for
the options or warrants or other rights issued by way of rights and
for the total number of Ordinary Shares deliverable on the exercise
thereof, would purchase at such Average Mid Market Price on the
Effective Date; and
C is the number of Ordinary Shares to be issued or, as the case
may be, the maximum number of Ordinary Shares which may be issued
upon exercise of such options, warrants or rights calculated as at
the date of issue of such options, warrants or rights or upon
conversion or exchange or exercise of rights of subscription or
purchase in respect thereof at the initial conversion, exchange,
subscription, purchase or acquisition price or rate;
Such adjustment shall become effective on the Effective Date
(or, if later, the dealing day following the record date or other
due date for establishment of the entitlement of Shareholders to
participate in the relevant issue or grant).
"Effective Date" means, in respect of this paragraph 4.6, the
first date on which the Ordinary Shares are traded ex-rights,
ex-options or ex-warrants on the Relevant Stock Exchange.
4.7 Rights Issues - Securities
If and whenever the Company shall issue any Securities (except
where the Conversion Price falls to be adjusted under paragraphs
4.4 or 4.6 above) to Shareholders as a class by way of rights or
grant to Shareholders as a class by way of rights any options,
warrants or other rights to subscribe for or purchase or otherwise
acquire any securities (except where the Conversion Price falls to
be adjusted under paragraphs 4.4 or 4.6 above), the Conversion
Price shall be adjusted by multiplying the Conversion Price in
force immediately prior to the Effective Date by the following
fraction:
A - B
A
where:
A is the Average Mid Market Price on the Effective Date; and
B is the Fair Market Value on the Effective Date of the portion
of the rights attributable to one Ordinary Share.
Such adjustment shall become effective on the Effective
Date.
"Effective Date" means, in respect of this paragraph 4.7, the
first date on which the Ordinary Shares are traded ex-rights,
ex-options or ex-warrants on the Relevant Stock Exchange.
4.8 Issue of Ordinary Shares
If and whenever the Company shall issue (otherwise than as
mentioned in paragraph 4.6 above) wholly for cash or for no
consideration any Ordinary Shares (other than Ordinary Shares
issued on the conversion of the CULS or on the exercise of any
rights of conversion into, or exchange or subscription for or
purchase of, Ordinary Shares) or issue or grant (otherwise than as
mentioned in paragraph 4.6 above) wholly for cash or for no
consideration any options, warrants or other rights to subscribe
for or purchase or otherwise acquire Ordinary Shares (other than
the CULS, which term shall for this purpose include any Further
CULS), in each case at a consideration receivable per Ordinary
Share (based, where appropriate, on such number of Ordinary Shares
as determined by reference to the proviso below) which is less than
90 per cent. of the Average Mid Market Price on the date of the
first public announcement of the terms of such issue or grant, the
Conversion Price shall be adjusted by multiplying the Conversion
Price in force immediately prior to the Effective Date by the
following fraction:
A + B
A + C
where:
A is the number of Ordinary Shares in issue on the date of first
public announcement of the terms of such issue or grant;
B is the number of Ordinary Shares which the aggregate
consideration (if any) receivable for the issue of such Ordinary
Shares or, as the case may be, for the Ordinary Shares to be issued
or otherwise made available upon the exercise of any such options,
warrants or rights, would purchase at such Average Mid Market Price
on the Effective Date; and
C is the number of Ordinary Shares to be issued pursuant to such
issue of such Ordinary Shares or, as the case may be, the maximum
number of Ordinary Shares which may be issued upon exercise of such
options, warrants or rights calculated as at the date of issue of
such options, warrants or rights,
Such adjustment shall become effective on the Effective
Date.
"Effective Date" means, in respect of this paragraph 4.8, the
date of issue of such Ordinary Shares or, as the case may be, the
issue or grant of such options, warrants or rights.
4.9 Issue of Securities
If and whenever the Company shall issue wholly for cash or for
no consideration any Securities (other than the CULS, which term
shall for this purpose exclude any Further CULS) which by their
terms of issue carry (directly or indirectly) rights of conversion
into, or exchange or subscription for, purchase of, or rights to
otherwise acquire, Ordinary Shares (or shall grant any such rights
in respect of existing Securities so issued) or Securities which by
their terms might be reclassified or redesignated as Ordinary
Shares, and the consideration per Ordinary Share receivable upon
conversion, exchange, subscription, purchase, acquisition,
reclassification or redesignation is less than 90 per cent. of the
Average Mid Market Price on the date of the first public
announcement of the terms of issue of such Securities (or the terms
of such grant), the Conversion Price shall be adjusted by
multiplying the Conversion Price in force immediately prior to the
Effective Date by the following fraction:
A + B
A + C
where:
A is the number of Ordinary Shares in issue on the date of first
public announcement of the terms of such Securities (but where the
relevant Securities carry rights of conversion into or rights of
exchange or subscription for, purchase of, or rights to otherwise
acquire Ordinary Shares which have been issued, purchased or
acquired by the Company for the purposes of or in connection with
such issue, less the number of such Ordinary Shares so issued,
purchased or acquired);
B is the number of Ordinary Shares which the aggregate
consideration (if any) receivable for the Ordinary Shares to be
issued or otherwise made available upon conversion or exchange or
upon exercise of the right of subscription, purchase or acquisition
attached to such Securities or, as the case may be, for the
Ordinary Shares to be issued or to arise from any such
reclassification or redesignation would purchase at such Average
Mid Market Price; and
C is the maximum number of Ordinary Shares to be issued or
otherwise made available upon conversion or exchange of such
Securities or upon the exercise of such right of subscription,
purchase or acquisition attached thereto at the initial conversion,
exchange or subscription, purchase or acquisition price or rate or,
as the case may be, the maximum number of Ordinary Shares which may
be issued or arise from any such reclassification or
redesignation;
provided that if at the Effective Date such number of Ordinary
Shares is to be determined by reference to the application of a
formula or other variable feature or the occurrence of any event at
some subsequent time (which may be when such securities are
converted or exchanged or rights of subscription, purchase or
acquisition are exercised or, as the case may be, such Securities
are reclassified or redesignated or at such other time as may be
provided), then for the purposes of this paragraph 4.9, "C" shall
be determined by the application of such formula or variable
feature or as if the relevant event occurs or had occurred as at
the Effective Date and as if such conversion, exchange,
subscription, purchase, acquisition, reclassification or, as the
case may be, redesignation had taken place on the Effective
Date.
Such adjustment shall become effective on the Effective
Date.
"Effective Date" means, in respect of this paragraph 4.9, the
date of issue of such Securities or, as the case may be, the grant
of such rights.
4.10 Modification of Rights
If and whenever there shall be any modification of the rights of
conversion, exchange, subscription, purchase or acquisition
attaching to any Securities (other than the CULS, which term shall
for this purpose include any Further CULS) as are mentioned in
paragraph 4.9 (other than in accordance with the terms (including
terms as to adjustment) applicable to such Securities upon issue)
so that following such modification the consideration per Ordinary
Share receivable has been reduced and is less than 90 per cent. of
the Average Mid Market Price on the date of the first public
announcement of the proposals for such modification, the Conversion
Price shall be adjusted by multiplying the Conversion Price in
force immediately prior to the Effective Date by the following
fraction:
A + B
A + C
where:
A is the number of Ordinary Shares in issue on the date of the
first public announcement of the proposals for such modification
(but where the relevant Securities carry rights of conversion into
or rights of exchange or subscription for, or purchase or
acquisition of, Ordinary Shares which have been issued, purchased
or acquired by the Company for the purposes of or in connection
with such securities, less the number of such Ordinary Shares so
issued, purchased or acquired);
B is the number of Ordinary Shares which the aggregate
consideration (if any) receivable for the Ordinary Shares to be
issued or otherwise made available upon conversion or exchange or
upon exercise of the right of subscription, purchase or acquisition
attached to the Securities so modified would purchase at such
Average Mid Market Price on the date of such first public
announcement or, if lower, the existing conversion, exchange,
subscription, purchase or acquisition price or rate of such
Securities; and
C is the maximum number of Ordinary Shares which may be issued
or otherwise made available upon conversion or exchange of such
securities or upon the exercise of such rights of subscription,
purchase or acquisition attached thereto at the modified
conversion, exchange, subscription, purchase or acquisition price
or rate but giving credit in such manner as an Expert shall
consider in good faith appropriate for any previous adjustment
under this paragraph 4.10 or paragraph 4.9 above,
provided that if at the Effective Date such number of Ordinary
Shares is to be determined by reference to the application of a
formula or other variable feature or the occurrence of any event at
some subsequent time (which may be when such Securities are
converted or exchanged or rights of subscription, purchase or
acquisition are exercised or at such other time as may be
provided), then for the purposes of this paragraph 4.10, "C" shall
be determined by the application of such formula or variable
feature or as if the relevant event occurs or had occurred as at
the Effective Date and as if such conversion, exchange,
subscription, purchase or acquisition had taken place on the
Effective Date.
Such adjustment shall become effective on the Effective
Date.
"Effective Date" means, in respect of this paragraph 4.10, the
date of modification of the rights of conversion, exchange,
subscription, purchase or acquisition attaching to such
Securities.
4.11 Change of Control
If a Change of Control (as defined in paragraph 5) shall occur,
then upon any exercise of Conversion Rights during the Change of
Control Period (as defined below) the Conversion Price (the "Change
of Control Conversion Price") shall be determined as set out
below:
COCCP = OCP/(1+ (CP x c/t))
where:
Change of Control Period means the period commencing on
the Change of Control and ending
60 days following the Change
of Control or, if later, 60 days
following the date on which a
Change of Control Notice is served
on the CULS Holders
COCCP means the Change of Control Conversion
Price;
OCP means the Conversion Price in
effect on the relevant Conversion
Date;
CP means 16.67 per cent. (expressed
as a fraction);
c means the number of calendar
days from and including the date
the Change of Control occurs
to but excluding the Final Maturity
Date; and
t means the number of calendar
days from and including the Issue
Date of the CULS to but excluding
the Final Maturity Date.
4.12 General
4.13 If the Company determines in good faith that an adjustment
should be made to the Conversion Price as a result of one or more
circumstances not referred to above in this paragraph 4 (even if
the relevant circumstance is specifically excluded from the
operation of paragraphs 4.3 to 4.11 above), the Company shall, at
its own expense and acting reasonably, request an Expert to
determine as soon as practicable what adjustment (if any) to the
Conversion Price is fair and reasonable to take account thereof and
the date on which such adjustment (if any) should take effect and
upon such determination such adjustment (if any) shall be made and
shall in good faith take effect in accordance with such
determination, provided that an adjustment shall only be made
pursuant to this paragraph 4.13 if such Expert is so requested to
make such a determination not more than 21 days after the date on
which the relevant circumstance arises and if the adjustment would
result in a reduction to the Conversion Price.
4.14 Notwithstanding the foregoing provisions:
4.14.1 where the events or circumstances giving rise to any
adjustment pursuant to this paragraph 4 have already resulted or
will result in an adjustment to the Conversion Price or where the
events or circumstances giving rise to any adjustment arise by
virtue of any other events or circumstances which have already
given or will give rise to an adjustment to the Conversion Price or
where more than one event which gives rise to an adjustment to the
Conversion Price occurs within such a short period of time that, in
the reasonable opinion of the Company, a modification to the
operation of the adjustment provisions is required to give the
intended result, such modification shall be made to the operation
of the adjustment provisions as may be advised in good faith by an
Expert to be in its opinion appropriate to give the intended
result;
4.14.2 such modification shall be made to the operation of the
conditions of the Trust Deed as may be advised in good faith by an
Expert to be in its opinion appropriate (i) to ensure that an
adjustment to the Conversion Price or the economic effect thereof
shall not be taken into account more than once and (ii) to ensure
that the economic effect of a dividend is not taken into account
more than once; and
4.14.3 other than pursuant to paragraph 4.3, no adjustment shall
be made that would result in an increase to the Conversion
Price.
4.15 All adjustments to the Conversion Price shall be rounded
upwards if necessary to four decimal places. The Company will
forthwith notify the CULS Holders in writing (in a form previously
approved in writing by the Trustee) of any adjustment to the
Conversion Price pursuant to paragraph 4.
4.16 The Trustee shall not be under any duty or obligation to
monitor whether any event or circumstance has happened or exists
pursuant to paragraph 4 and it may assume until it has actual
knowledge by way of express notice in writing from the Company to
the contrary that no such event has occurred and will not be
responsible to any party for any loss arising from any failure by
it to do so. The Trustee shall not at any time be under any duty or
responsibility to any CULS Holder with respect to the nature or the
extent of any adjustment to the Conversion Price when made, or with
respect to the method employed in making the same.
5 Change of Control
5.1 If, whilst any of the CULS remains capable of being
converted, any offer is made to all (or as nearly as may be
practicable all) the Shareholders (or to all (or as nearly as may
be practicable all) other than the offeror and/or any company
controlled by the offeror and/or persons associated, connected or
acting in concert with the offeror) to acquire the whole or any
part of the Ordinary Shares (an "Offer") and the Company becomes
aware that the right to cast more than 50 per cent. of the votes
which may ordinarily be cast on a poll at a general meeting of the
Company or to appoint and/or remove all or a majority of the
members of the Board has or will become vested in the offeror
and/or any company controlled by the offeror and/or persons
associated, connected or acting in concert with the offeror
("Change of Control"), the Company shall give notice of that fact
in writing (in a form previously approved in writing by the
Trustee) (a "Change of Control Notice") to all CULS Holders within
14 days of its becoming so aware. The publication of a scheme of
arrangement pursuant to Part 26 of the Companies Act providing for
the acquisition by any person of the whole or any part of the
Ordinary Shares shall be deemed to be the making of an Offer.
5.2 If an offer, proposal, scheme or other arrangement which is
on terms as to consideration which are, in the opinion of an
Expert, fair and reasonable (having regard to the terms of the
Conversion Rights and the period during which they may be exercised
and to the terms of such offer and to any other circumstances which
may appear to such Expert) (a "Comparable CULS Offer") has already
been, or not later than 30 days after the date of such Change of
Control Notice is, made or put to all CULS Holders then the Company
shall forthwith thereafter give further notice in writing of that
fact (in a form previously approved in writing by the Trustee) to
all CULS Holders (a "Comparable CULS Offer Notice") and each CULS
Holder may, by giving written notice to the Company (in a form
previously approved in writing by the Trustee) within the 30 days
after the service of a Comparable CULS Offer Notice, require the
Company to repay the whole or any part (being an integral multiple
of GBP5,000 nominal) of his or her CULS at its nominal amount
together with accrued interest up to (but excluding) the date
specified in the Comparable CULS Offer Notice (which date shall be
a date falling not less than eight weeks and not more than ten
weeks following the date of the Comparable CULS Offer Notice), in
which event the Company shall be bound to repay such CULS together
with interest accrued accordingly.
5.3 If no Comparable CULS Offer is made within the 30 days after
the date of a Change of Control Notice, the Company shall forthwith
give notice in writing of that fact (in a form previously approved
in writing by the Trustee) (a "Default Notice") to all CULS Holders
and each CULS Holder shall have the right by giving written notice
(in a form previously approved in writing by the Trustee) to the
Company within 30 days after service of such Default Notice, (a) to
require the Company to repay the whole or any part (being an
integral multiple of GBP5,000 nominal) of his or her CULS at its
nominal amount together with accrued interest up to (but excluding)
the date specified in the Default Notice (which date shall be a
date falling not less than eight weeks and not more than 10 weeks
following the date of such Default Notice), in which event the
Company shall be bound to repay such CULS together with accrued
interest accordingly, and/or (b) to exercise his or her Conversion
Rights in respect of the whole or any part (being an integral
multiple of GBP5,000 nominal) of his or her CULS as he or she may
specify (and so that for this purpose such 30-day period shall be
deemed to be a Conversion Period, the last day thereof shall be
deemed to be a Conversion Date and the provisions of paragraph 3.12
shall apply accordingly) at the Conversion Price applicable on such
deemed Conversion Date (after making any appropriate adjustments
pursuant to paragraph 4).
5.4 The Change of Control Notice shall also specify:
5.4.1 all information material to CULS Holders concerning the Change of Control;
5.4.2 the Conversion Price immediately prior to the occurrence
of the Change of Control and the indicative Change of Control
Conversion Price (as defined in paragraph 4.11) applicable on the
basis of such Conversion Price;
5.4.3 the closing price of the Ordinary Shares as at the latest practicable date prior to the publication of the Change of Control Notice; and
5.4.4 such other information relating to the Change of Control as the Trustee may require.
5.5 The Trustee shall not be required to monitor or take any
steps to ascertain whether a Change of Control or any event which
could lead to a Change of Control has occurred or may occur and
will not be responsible or liable to CULS Holders or any person for
any loss arising from any failure by it to do so.
6 Undertakings
6.1 If, whilst any CULS remains capable of being converted, the
Company commences liquidation (whether voluntary or compulsory) it
shall forthwith give notice in writing thereof (in a form
previously approved in writing by the Trustee) ("Liquidation
Notice") to all CULS Holders and thereupon each CULS Holder shall
in respect of the whole or any part (being an integral multiple of
GBP5,000 nominal) of his or her CULS be entitled within four weeks
after the service of the Liquidation Notice to elect by notice in
writing to the Company to be treated as if a Conversion Date had
occurred on the day immediately preceding the date of such
commencement of liquidation ("Liquidation Conversion Day") and his
or her Conversion Rights had been exercisable and had been
exercised in full with effect on the Liquidation Conversion Day at
the Conversion Price then applicable (after making any appropriate
adjustments pursuant to paragraph 4). In that event, subject as
hereafter provided in this paragraph 6.1, each CULS Holder making
such an election shall, in lieu of the payments which would
otherwise be due in respect of his or her CULS be deemed to have
had his CULS converted as a result of such election and be entitled
to participate in the assets available in the liquidation pari
passu with the Ordinary Shareholders (after giving effect to the
rights of any other securities carrying rights to participate in
the assets of the Company available on a liquidation) as if he or
she were the holder of the Ordinary Shares to which he or she would
have become entitled had the CULS in respect of which he or she
shall have made such election been converted as aforesaid.
Notwithstanding the foregoing, a CULS Holder making such an
election shall be entitled to receive and retain any payment in
respect of the CULS in relation to which he or she shall have made
such election which shall have become due on or prior to the
Liquidation Conversion Day as though he or she had not made such
election. For the purpose of determining the assets in which any
CULS Holder making an election as aforesaid shall be entitled to
participate, the provisions of paragraph 3.12 shall be deemed to
apply as if the Liquidation Conversion Day were a Conversion Date,
provided that if such CULS Holder shall receive any payment on the
CULS in relation to which he or she shall have made such an
election in respect of interest falling due on the CULS on such
Liquidation Conversion Day or any day thereafter up to and
including the date of service of the Liquidation Notice by the
Company, he or she shall be entitled to retain such payment.
If, at any time, the Company posts a notice to its Ordinary
Shareholders convening a meeting at which a resolution will be
proposed to wind up the Company ("Winding Up Resolution"), it may
at the same time give notice in writing to all CULS Holder (in a
form previously approved in writing by the Trustee) ("Winding Up
Notice") in which event the period of four weeks referred to above
shall commence on the date of the Winding Up Notice and a CULS
Holder shall, in respect of the whole or any part (being an
integral multiple of GBP5,000 nominal) of his or her CULS, be
entitled to elect within that period by notice in writing to the
Company that, if such resolution is passed, he or she should be
treated as if a Conversion Date had occurred on the day immediately
preceding the date on which the Winding Up Resolution is passed and
his or her Conversion Rights had been exercisable and had been
exercised in full with effect on that date on the same basis,
mutatis mutandis, as is referred to above (and, for the avoidance
of doubt, if the Company shall give a Winding Up Notice to CULS
Holders as referred to in this paragraph, no further notice shall
be given to CULS Holders under this paragraph 6.1 on commencement
of the liquidation). Subject to this paragraph 6.1, the Conversion
Rights shall lapse in the event of the liquidation of the
Company.
6.2 If, whilst any CULS remains capable of being converted, the
CULS shall become immediately due and repayable in accordance with
the provisions of the Trust Deed (for any reason other than the
liquidation of the Company), the Company shall forthwith give
notice in writing thereof to all CULS Holders (in a form previously
approved in writing by the Trustee), and thereupon each CULS Holder
shall in respect of the whole or any part (being an integral
multiple of GBP5,000 nominal) of his or her CULS be entitled within
six weeks after the service of such notice to exercise his or her
Conversion Rights (such exercise to be with effect as on the day
immediately preceding the date on which the CULS shall have become
so due and repayable, which day shall be deemed to be a Conversion
Date) at the Conversion Price then applicable (after making any
appropriate adjustments pursuant to paragraph 4) by completing and
signing the Conversion Notice(s) on the Certificate(s) representing
the CULS in respect of which he or she wishes to exercise his or
her Conversion Rights and depositing the same at the office of the
Company's Registrars or lodging an Uncertificated Conversion Notice
(as the case may be), in each case before the expiry of such period
of six weeks.
6.3 While any Conversion Rights remain capable of exercise by
any CULS Holder or the Trustee, save with the previous sanction of
a Special Resolution or with the prior approval of the Trustee
where, in the Trustee's opinion, it is not materially prejudicial
to the interests of the CULS Holders to give such approval, the
Company shall procure that no compromise or arrangement (to which
Part 26 of the Companies Act applies) affecting the Ordinary Shares
shall be proposed unless the CULS Holders shall be parties to the
compromise or arrangement and unless the compromise or arrangement
shall be subject to approval by the CULS Holders in the manner
prescribed by section 899 of the Companies Act provided that these
provisions shall not apply (i) if an offer, proposal, scheme or
other arrangement which is, in the opinion of an Expert, fair and
reasonable (having regard to the terms of the Conversion Rights and
the periods during which they may be exercised and to the terms of
such compromise or arrangement and to any other circumstances which
may appear to such Expert to be relevant) has already been, or not
later than the date on which the document containing particulars of
the compromise or arrangement shall first be issued to the parties
thereto is, made or put to all CULS Holders, (ii) if the Trustee
shall be of the opinion that implementation of such compromise or
arrangement will not be prejudicial to the interests of the CULS
Holders or (iii) to a scheme of arrangement to which paragraph 5
applies.
7 Covenants relating to Conversion Rights
7.1 While any Conversion Rights remain capable of exercise by
any CULS Holder or the Trustee, save with the previous sanction of
Special Resolution or with the prior approval of the Trustee where,
in the Trustee's opinion, it is not materially prejudicial to the
interests of the CULS Holders to give such approval, the Company
shall:
7.1.1 use all reasonable endeavours to procure that (a) the CULS
shall at all times remain admitted to trading on the International
Securities Market of the London Stock Exchange and (b) the Ordinary
Shares which are fully paid shall at all times remain admitted to
trading either on AIM or one of the stock markets of the London
Stock Exchange;
7.1.2 use all reasonable endeavours to ensure that during such
time as the Ordinary Shares are admitted to trading on AIM or one
of the stock markets of the London Stock Exchange, all the Ordinary
Shares allotted on exercise of Conversion Rights will, on
allotment, be admitted to trading on AIM or the relevant market of
the London Stock Exchange;
7.1.3 not issue any securities or rights to subscribe for or to
convert or exchange any securities into shares or securities or
reclassify issued share capital into shares or securities of a
particular class where such shares or securities would on issue,
conversion, exchange or reclassification have as regards voting,
dividends, other distributions or capital more favourable rights
than those attached to the Ordinary Shares;
7.1.4 send to all CULS Holders a copy of any document sent by
the Company to Shareholders at the time the same is sent to
Shareholders;
7.1.5 ensure that sufficient authorities to issue Ordinary
Shares are obtained from holders of existing Ordinary Shares to
satisfy in full all rights for the time being outstanding of
conversion into, subscription for, and other acquisition of,
Ordinary Shares, including, without limitation, the rights
conferred by the CULS; and
7.1.6 as soon as practicable after the announcement of any event
giving rise to an adjustment to the Conversion Price pursuant to
the Conditions, give notice to the CULS Holders in accordance with
paragraph 3.7 advising them of the date on which the relevant
adjustment to the Conversion Price is likely to become
effective.
7.2 While any Conversion Rights remain capable of exercise by
any CULS Holder or the Trustee and save with the sanction of
Special Resolution or (save in respect of paragraph 7.2.2) with the
prior approval of the Trustee where, in the Trustee's opinion, it
is not materially prejudicial to the interests of the CULS Holders
to give such approval:
7.2.1 the Company shall, subject only to their being admitted to
trading on a market of the London Stock Exchange or any other stock
exchange or securities market on which the Ordinary Shares may then
be listed or quoted or dealt in, issue, allot and deliver Ordinary
Shares on exercise of Conversion Rights;
7.2.2 the Company shall not declare or pay dividends to holders
of Ordinary Shares if at the relevant time any interest due and
payable in respect of the CULS has not been paid; and
7.2.3 the Company shall not take any action if the effect
thereof would be that, on conversion of the CULS, Ordinary Shares
could not, under any applicable law then in effect, be legally
issued as fully paid.
8 Purchase and redemption
8.1 The Company or any subsidiary of the Company may at any time
purchase CULS on any market of the London Stock Exchange (if the
CULS is then admitted to trading on any market of the London Stock
Exchange) or on any other stock exchange on which the CULS is for
the time being listed or quoted or by tender (available to all CULS
Holders alike) or by private treaty.
8.2 All CULS not previously redeemed, purchased or converted in
accordance with the Trust Deed will be redeemed by the Company on
30 July 2024 at its nominal amount, together with interest accrued
up to (but excluding) the date of final repayment of the CULS.
8.3 All CULS repaid, redeemed, purchased or converted in
accordance with the provisions of the Trust Deed shall be cancelled
and the Company shall not be at liberty to keep the same alive for
the purposes of re-sale or re-issue or to resell or re-issue the
same.
8.4 The Company may exercise its rights and powers of
conversion, redemption and purchase as regards the CULS and any
Further CULS at its sole discretion and without obligation to
maintain the ratio between the nominal amounts for the time being
outstanding of CULS of any series.
9 Events of default
9.1 Upon the occurrence of any of the following events the
Trustee may at its discretion and, if requested in writing by CULS
Holders holding at least one-quarter in nominal amount of the CULS
then outstanding or directed by a Special Resolution, shall
(subject in each case to being indemnified and/or secured and/or
pre-funded by CULS Holders to its satisfaction) give written notice
to the Company that the CULS is (and it shall thereupon forthwith
become) immediately due and payable at its nominal amount together
with accrued interest as provided in the Trust Deed:
9.1.1 if the Company is in default for a period of 30 days or
more in the payment on the due date of any principal or interest or
principal due in respect of the CULS; or
9.1.2 if an order is made or an effective resolution passed for
the winding-up or dissolution of the Company (except for the
purpose of a reconstruction or amalgamation the terms of which have
previously been approved in writing by the Trustee (such consent
not to be unreasonably withheld or delayed) or by a Special
Resolution); or
9.1.3 if:
(a) the Company is unable or admits inability to pay its debts as they fall due;
(b) the value of the assets of the Company is less than its
liabilities (taking into account contingent and prospective
liabilities);
(c) a moratorium is declared in respect of any indebtedness of the Company;
(d) the Company ceases or threatens to cease to carry on all or
substantially all of its business, which shall not include a
reconstruction or amalgamation the terms of which have previously
been approved in writing by the Trustee (such consent not to be
unreasonably withheld or delayed) or by a Special Resolution;
or
9.1.4 if an encumbrancer takes possession or a receiver or
administrator or administrative receiver or other similar official
is appointed of the Company or of the whole or a substantial part
of the assets or undertaking of the Company or a distress or
execution is levied or enforced on or sued out against the whole or
a substantial part of the assets or property of the Company and, in
each case, is not discharged within 30 days of being levied,
enforced or sued out; or
9.1.5 if the Company breaches any of the provisions binding on
it under or pursuant to the Trust Deed (other than any covenant for
the payment of principal and interest in respect of the CULS) or if
any event occurs or any action is taken or fails to be taken which
is (or but for the provisions of any applicable law would be) a
breach of any of the covenants contained in the Trust Deed and
(except where in the opinion of the Trustee the same is not capable
of remedy, when no such continuation or notice as is herein
provided will be required) the same continues for more than 14 days
after receipt by the Company of written notice from the Trustee
requiring the same to be remedied; or
9.1.6 if the Company, without the prior written consent of the
Trustee or without the approval of a Special Resolution, alters the
rights attached to all or any of its Ordinary Shares in issue from
time to time or attaches any special rights, privileges or
restrictions thereto, and in each case (except where, in the
opinion of the Trustee, such alteration or attachment is not
capable of cancellation when no such continuation or notice as is
herein provided shall be required) such alteration or attachment
shall continue for more than 14 days after written notice requiring
such alteration or attachment to be cancelled shall have been given
to the Company by the Trustee, provided that nothing in this
paragraph shall restrict the right of the Company to consolidate or
sub-divide Ordinary Shares or convert Ordinary Shares into stock or
vice versa and no such consolidation, subdivision or conversion
shall give rise to any rights under this paragraph 9.
9.2 Provided that no such event set out in any of paragraphs
9.1.3 to 9.1.6 above (both inclusive) shall constitute an event of
default on the occurrence of which the CULS may become immediately
due and repayable unless the Trustee shall have certified in
writing that, in its opinion, such event is materially prejudicial
to the interests of the CULS Holders.
10 Enforcement
10.1 The Trustee may at any time, at its discretion and without
notice, take such proceedings and/ or other action as it may think
fit against or in relation to the Company to enforce its
obligations under the Trust Deed. Notwithstanding the Trustee
having received payment in respect of all or any of the CULS after
the same shall have become immediately due and payable under the
provisions of paragraph 9, the CULS shall be deemed to remain
outstanding for the purposes of and for the relevant period of four
weeks or six weeks as mentioned in paragraph 6.1 and 6.2
respectively.
10.2 Proof that as regards any specified CULS Holder the Company
has made default in paying any amount due in respect of his or her
CULS shall (unless the contrary be proved) be sufficient evidence
that the same default has been made as regards all other CULS
Holders in respect of which the relevant amount is due and
payable.
11 Subordination
11.1 The rights and claims of the CULS Holders may, in the event
of the winding-up or dissolution of the Company, be subordinated to
the claims of creditors in respect of the Company's secured and
unsecured borrowings such that, on such winding-up or dissolution,
no payments (whether of principal or outstanding or accrued
interest) will be made to the CULS Holders until payment in full
has been made to all such creditors.
11.2 Any amounts paid to the Trustee in the winding-up of the
Company in respect of the claims of the holders of the CULS shall
be held by the Trustee upon trust to be applied:
11.2.1 first, for distribution in or towards payment or
satisfaction of all liabilities incurred and payments made by the
Trustee and/or any attorney, manager or agent of the Trustee in
carrying out its functions under the provisions of these presents
and all remuneration payable to the Trustee;
11.2.2 second, to the extent of any shortfall, for distribution
in or towards payment or satisfaction of the claims of all
creditors in respect of the Company's secured and unsecured
borrowings which are admitted to proof in the winding up of the
Company excluding any indebtedness subordinated to the CULS or
which is expressed to rank pari passu with the CULS; and
11.2.3 third, in or towards payment pari passu and rateably of
all principal moneys, interest and other amounts (if any) due in
respect of the CULS (to the extent that the claims in the name of
the Trustee in respect thereof shall be admitted in such
winding-up).
12 Denomination and transfer
The CULS will be denominated, and will be registered and
transferable without payment of any fee (excepting all transfer
taxes), in integral multiples of GBP5,000 nominal. The Trust Deed
will contain provisions enabling the CULS to be held and
transferred in uncertificated form. The Trustee may, without any
sanction of CULS Holders, concur with the Company in making
modifications to the provisions of the Trust Deed in order to
reflect changes in the CREST Regulations or in the applicable law
and practice relating to the holding or transfer of CULS in
uncertificated form and the issue of Ordinary Shares in
uncertificated form on conversion of CULS.
13 Issues of further unsecured loan stock
Provision will be made in the Trust Deed to enable further
convertible unsecured loan stock of the Company to be issued either
so as to be identical in all respects with and to form a single
series with the CULS or on such terms, including rights as to
interest, ranking (but not ranking ahead of the CULS), conversion,
repayment and otherwise as the Directors may determine. Such
further convertible unsecured loan stock shall, if identical and
forming a single series with the CULS, and may in any other case
with the consent of the Trustee, be constituted by a trust deed
supplemental to the Trust Deed and shall accordingly, if so
constituted, be Further CULS.
14 Modification of rights, etc.
14.1 The Trustee may from time to time without the consent or
sanction of the CULS Holders (but only if and insofar as in the
opinion of the Trustee the interests of the CULS Holders will not
be materially prejudiced thereby), on such terms and subject to
such conditions as it shall deem expedient, waive or authorise any
breach or proposed breach by the Company of any of the covenants or
provisions of the Trust Deed, determine that any act or omission
which would or could constitute an event of default under the Trust
Deed shall not do so, or agree to any modification of the
provisions of the Trust Deed. The Trustee may also agree, without
such consent or sanction, to any modification of the Trust Deed
which is of a formal, technical or minor nature or to correct a
manifest error or an error which is in the opinion of the Trustee
proven. Provision will be made for convening separate meetings of
the holders of the CULS and each series of any Further CULS when
the Trustee considers this appropriate.
14.2 In connection with the exercise by it of any of its trusts,
powers, authorities and discretions under the Trust Deed
(including, without limitation, any modification, waiver,
authorisation or determination), the Trustee shall have regard to
the general interests of the CULS Holders as a class but shall not
have regard to any interests arising from circumstances particular
to individual CULS Holders (whatever their number) and, in
particular but without limitation, shall not have regard to the
consequences of such exercise for individual CULS Holders (whatever
their number) resulting from their being for any purpose domiciled
or resident in, or otherwise connected with, or subject to the
jurisdiction of, any particular territory or any political
subdivision thereof and the Trustee shall not be entitled to
require, nor shall any CULS Holder be entitled to claim, from the
Company, the Trustee or any other person, any indemnification or
payment in respect of any tax consequences of any such exercise on
individual CULS Holders.
15 Trustee's indemnification and consents
15.1 The Company shall pay or discharge all reasonably and
properly incurred liabilities incurred by the Trustee in relation
to the preparation and execution of, the exercise of its powers and
the performance of its duties under, and in any other manner in
relation to, the Trust Deed, including, but not limited to,
travelling expenses and any stamp, issue, registration, documentary
and other taxes or duties paid or payable by the Trustee in
connection with any action taken or contemplated by or on behalf of
the Trustee for enforcing, or resolving any doubt concerning, or
for any other purpose in relation to, these presents, except for
those liabilities which result from the fraud, gross negligence or
wilful misconduct of the Trustee
15.2 Any consent given by the Trustee may be given on such terms
and subject to such conditions (if any) as the Trustee may in its
absolute discretion think fit and, notwithstanding anything to the
contrary in this Part 3, may be given retrospectively.
16 Payments
16.1 Method of payment
16.1.1 CULS in certificated form
Payment of interest will be made by transfer to a Sterling
account (or other account to which Sterling may be credited)
maintained by the CULS Holder with a bank in the City of London as
previously notified to the Registrar, or in the absence of a bank
account by cheque posted to the registered address of the
first-named holder on the CULS Register. Payment of the nominal
amount will be made by cheque posted to the registered address of
the first-named holder on the CULS Register.
16.1.2 CULS in uncertificated form
The Company shall pay or cause to be paid payments of nominal
amount in respect of CULS held in uncertificated form by way of a
CREST assured payment in accordance with the CREST Regulations.
Payments of interest in respect of CULS held in uncertificated
form will be made by transfer to a Sterling account (or other
account to which Sterling may be credited) maintained by the CULS
Holder with a bank in the City of London where previously notified
to the Registrar, or by cheque posted to the address of the
first-named holder on the CULS Register relating to CULS held in
uncertificated form, or by way of a CREST assured payment in
accordance with the CREST Regulations.
16.2 Payments subject to fiscal laws
All payments in respect of the CULS are subject in all cases to
any fiscal or other laws and regulations applicable thereto in the
place of payment. No commissions or expenses shall be charged to
CULS Holders in respect of such payments.
16.3 Non-Business Days
Every cheque sent through the post shall be sent by first class
post on or before the Business Day next preceding the due date of
the relevant nominal and/or interest payment unless such due date
is not a Business Day, in which event it shall be sent on or before
the second Business Day next preceding the due date of the relevant
payment. Where payment is to be made by transfer to a Sterling bank
account, payment instructions (for value the due date or, if the
due date is not a Business Day, for value the next succeeding
Business Day) will be initiated on the due date for payment. A
holder of CULS shall not be entitled to any interest or other
payment in respect of any delay in payment resulting from the due
date for payment not being a Business Day.
16.4 Record date
Each payment in respect of CULS will be made to the person shown
as the CULS Holder in the CULS Register or in the case of joint
holders to the person whose name stands first in the CULS Register
at the close of business on the fifteenth day before the due date
for such payment.
16.5 Fractions
When making payments of nominal amount and/or interest to CULS
Holders, the relevant payment will be rounded down to the nearest
whole penny.
17 Removal, retirement and replacement of Trustee
The Trust Deed will contain provisions for the removal of the
Trustee by a Special Resolution and will permit the Trustee to
retire at any time on not less than three months' prior written
notice without assigning any reason. The Company will have the
power to appoint a new Trustee but such new Trustee shall be
subject to the approval of a Special Resolution.
18 Auditors
The Trust Deed will provide that the Trustee may rely on
certificates or reports provided by the Auditors or other experts
in accordance with the provisions of the Trust Deed whether or not
any such certificate or report shall be addressed to the Trustee
and whether or not any such certificate or report or any engagement
letter or other document entered into by the Trustee and/or the
Auditors or such other experts in connection therewith contains any
limit (whether monetary or otherwise) on the liability of the
Auditors or such other expert.
19 Governing Law
The Trust Deed will be governed by, and construed in accordance
with, the law of England and Wales.
Appendix II
TERMS AND CONDITIONS OF THE PLACING
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 ARE ONLY DIRECTED
AT, AND BEING DISTRIBUTED TO, PERSONS WHOSE ORDINARY ACTIVITIES
INVOLVE THEM IN ACQUIRING, HOLDING, MANAGING AND DISPOSING OF
INVESTMENTS (AS PRINCIPAL OR AGENT) FOR THE PURPOSES OF THEIR
BUSINESS AND WHO HAVE PROFESSIONAL EXPERIENCE IN MATTERS RELATING
TO INVESTMENTS AND ARE: (A) IF IN A MEMBER STATE OF THE EUROPEAN
ECONOMIC AREA ("EEA"), PERSONS WHO ARE QUALIFIED INVESTORS WITHIN
THE MEANING OF ARTICLE 2(1)(E) OF THE EU PROSPECTUS DIRECTIVE
(WHICH MEANS DIRECTIVE 2003/71/EC, AS AMED FROM TIME TO TIME, AND
INCLUDES ANY RELEVANT IMPLEMENTING DIRECTIVE MEASURE IN ANY MEMBER
STATE OF THE EEA TO THE EXTENT IMPLEMENTED IN THE RELEVANT MEMBER
STATE OF THE EEA) (THE "PROSPECTUS DIRECTIVE") ("QUALIFIED
INVESTORS"); (B) IF IN THE UNITED KINGDOM, PERSONS WHO FALL WITHIN
THE DEFINITION OF "INVESTMENT PROFESSIONALS" IN ARTICLE 19(5) OF
THE FINANCIAL SERVICES AND MARKETS ACT 2000 (FINANCIAL PROMOTION)
ORDER 2005, AS AMED (THE "ORDER") OR ARE PERSONS FALLING WITHIN
ARTICLE 49(2) OF THE ORDER AND ARE "QUALIFIED INVESTORS" AS DEFINED
IN SECTION 86(7) OF THE FSMA; (C) IF IN THE UNITED STATES, PERSONS
REASONABLY BELIEVED TO BE QIBS AS DEFINED UNDER THE SECURITIES ACT;
OR (D) ANY OTHER PERSON TO WHOM IT MAY OTHERWISE LAWFULLY BE
COMMUNICATED; AND, IN EACH CASE, WHO HAVE BEEN INVITED TO
PARTICIPATE IN THE PLACING BY THE JOINT PLACING AGENTS (ALL SUCH
PERSONS TOGETHER BEING REFERRED TO AS "RELEVANT PERSONS").
THE TERMS AND CONDITIONS SET OUT HEREIN MUST NOT BE ACTED ON OR
RELIED ON BY PERSONS WHO ARE NOT RELEVANT PERSONS. ANY PERSON WHO
HAS RECEIVED OR IS DISTRIBUTING THESE TERMS AND CONDITIONS MUST
SATISFY THEMSELVES THAT IT IS LAWFUL TO DO SO. ANY INVESTMENT OR
INVESTMENT ACTIVITY TO WHICH THESE TERMS AND CONDITIONS RELATE IS
AVAILABLE ONLY TO RELEVANT PERSONS AND WILL BE ENGAGED IN ONLY WITH
RELEVANT PERSONS. THESE TERMS AND CONDITIONS DO NOT THEMSELVES
CONSTITUTE AN OFFER FOR SALE OR SUBSCRIPTION OF ANY SECURITIES IN
THE COMPANY (INCLUDING THE CULS AND ANY ORDINARY SHARES INTO WHICH
THE CULS CONVERT). THE SECURITIES HAVE NOT BEEN AND WILL NOT BE
REGISTERED UNDER THE SECURITIES ACT OR THE SECURITIES LAWS OF ANY
STATE OR OTHER JURISDICTION OF THE UNITED STATES AND THE SECURITIES
MAY NOT BE OFFERED, SOLD, TRANSFERRED OR DELIVERED, DIRECTLY OR
INDIRECTLY IN, INTO OR WITHIN THE UNITED STATES, EXCEPT PURSUANT TO
AN EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE
REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND APPLICABLE
STATE SECURITIES LAWS. THERE WILL BE NO PUBLIC OFFERING OF THE
SECURITIES IN THE UNITED STATES.
EACH PLACEE SHOULD CONSULT WITH ITS OWN ADVISERS AS TO LEGAL,
TAX, BUSINESS AND RELATED ASPECTS OF AN ACQUISITION OF CULS.
References in these terms and conditions to the Joint Placing
Agents shall, where the context so admits, be to either or both of
them.
If a person indicates to the Joint Placing Agents that it wishes
to participate in Placing by making an oral/or written (which
includes e-mail) offer to acquire CULS pursuant to the Placing
(each such person, a "Placee") it will be deemed to have read and
understood these terms and conditions and the Announcement of which
it forms part and the draft Admission Particulars dated 28 June
2019 prepared by, and relating to, the Company (the "Placing
Proof") in their entirety and to be making such offer on the terms
and conditions, and to be providing the representations,
warranties, indemnities, agreements and acknowledgements, contained
in these terms and conditions. In particular, each such Placee
represents, warrants and acknowledges that it is a Relevant Person
and undertakes that it will acquire, hold, manage and dispose of
any of the CULS that are allocated to it for the purposes of its
business only. Further, each such Placee represents, warrants and
agrees that: (a) if it is a financial intermediary, as that term is
used in Article 3(2) of the Prospectus Directive, that the CULS
subscribed for by it in the Placing will not be acquired on a
non-discretionary basis on behalf of, nor will they be acquired
with a view to their offer or resale to, persons in circumstances
which may give rise to an offer of securities to the public other
than an offer or resale in a member state of the EEA which has
implemented the Prospectus Directive to Qualified Investors, or in
circumstances in which the prior consent of the Joint Placing
Agents has been given to each such proposed offer or resale; and
(b) it is and, at the time the CULS are acquired, will be either
(i) outside the United States, and acquiring the CULS in an
offshore transaction in accordance with Rule 903 and Rule 904 of
Regulation S for its own account or purchasing the CULS for an
account with respect to which it exercises sole investment
discretion; or (ii) a QIB. These terms and conditions do not
constitute an offer to sell or issue or the invitation or
solicitation of an offer to buy or acquire CULS in the United
States or any other jurisdiction where to do so may be unlawful,
including, without limitation, Australia, Canada, Japan, New
Zealand, the Republic of South Africa or any other Excluded
Jurisdiction.
These terms and conditions and the information contained herein
are not for release, publication or distribution, directly or
indirectly, in whole or in part, to persons in the United States,
subject to certain exceptions, or Australia, Canada, Japan, New
Zealand, the Republic of South Africa or any other Excluded
Jurisdiction.
In particular, the CULS referred to in these terms and
conditions have not been and will not be registered under the
Securities Act or the securities laws of any state or other
jurisdiction of the United States and the CULS may not be offered
or sold directly or indirectly in, into or within the United
States, except pursuant to an exemption from, or in a transaction
not subject to, the registration requirements of the Securities Act
and applicable state securities laws. There will be no public
offering of the CULS in the United States. Subject to certain
exceptions, no offering of the CULS will be made in the United
States. The CULS have not been approved or disapproved by the U.S.
Securities and Exchange Commission, or state securities commission
in the United States or any 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. Any representation to the
contrary is a criminal offence in the United States.
The distribution of these terms and conditions and the offer
and/or placing of CULS in certain other jurisdictions may be
restricted by law. No action has been taken by the Joint Placing
Agents or the Company that would permit an offer of the CULS or
possession or distribution of these terms and conditions or any
other offering or publicity material relating to the CULS in any
jurisdiction where action for that purpose is required, save as
mentioned above. Persons into whose possession these terms and
conditions come are required by the Joint Placing Agents and the
Company to inform themselves about and to observe any such
restrictions.
Each Placee's commitments will be made solely on the basis of
the information set out in this Announcement and the Placing Proof
which has or will be provided to each Placee. Each Placee, by
participating in the Placing, agrees that it has neither received
nor relied on any other information, representation, warranty or
statement made by or on behalf of any of the Joint Placing Agents
or the Company and none of the Joint Placing Agents, the Company,
or any person acting on such person's behalf nor any of their
respective affiliates has or shall have liability for any Placee's
decision to accept this invitation 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. Nothing in this paragraph shall exclude the liability of
any person for fraudulent misrepresentation.
No undertaking, representation, warranty or any other assurance,
express or implied, is made or given by or on behalf of the Joint
Placing Agents or any of their respective affiliates, their
respective directors, officers, employees, agents, advisers, or any
other person, as to the accuracy, completeness, correctness or
fairness of the information or opinions contained in the Placing
Proof or this Announcement or for any other statement made or
purported to be made by any of them, or on behalf of them, in
connection with the Company or the Placing and no such person shall
have any responsibility or liability for any such information or
opinions or for any errors or omissions. Accordingly, save to the
extent permitted by law, no liability whatsoever is accepted by the
Joint Placing Agents or any of their respective directors,
officers, employees or affiliates or any other person for any loss
howsoever arising, directly or indirectly, from any use of this
announcement or such information or opinions contained herein or
otherwise arising in connection with the Placing Proof.
These terms and conditions, this Announcement and the Placing
Proof have been prepared and issued by the Company, and each of
these documents is the sole responsibility of the Company.
The Placing
The Joint Placing Agents have agreed, pursuant to the Placing
Agreement, to use reasonable endeavours to place, as agents for the
Company, the CULS with Placees at a subscription price of GBP5,000
per GBP5,000 nominal of CULS (the Placing Price"). The Placing is
not being underwritten by the Joint Placing Agents or otherwise and
the Joint Placing Agents are not obliged to subscribe for any CULS
pursuant to the Placing or otherwise.
Application will be made for the admission of the CULS to
trading on the London Stock Exchange's International Securities
Market ("Admission").
Subject to the conditions below being satisfied, it is expected
that Admission will become effective on 30 July 2019 and that
dealings for normal settlement in the CULS will commence at 8.00
a.m. on the same day.
The Placing is conditional, inter alia, upon:
(i) Admission becoming effective by not later than 8.00 a.m. on
30 July 2019 (or such later time and/or date as the Company and the
Joint Placing Agents may agree being not later than 9 August 2019);
and
(ii) the Placing Agreement having become unconditional in all
respects and not having been terminated in accordance with its
terms.
Bookbuild of the Placing
Commencing today, the Joint Placing Agents will be conducting
the Bookbuild to determine demand for participation in the Placing.
The Joint Placing Agents will seek to procure Placees as agent for
the Company as part of this Bookbuild. These terms and conditions
give details of the terms and conditions of, and the mechanics of
participation in, the Placing.
Principal terms of the Bookbuild
(a) By participating in the Placing, Placees will be deemed to
have read and understood this Announcement, these terms and
conditions and the Placing Proof in their entirety and to be
participating and making an offer for any CULS on these terms and
conditions, and to be providing the representations, warranties,
indemnities, acknowledgements and undertakings, contained in these
terms and conditions.
(b) The Joint Placing Agents are arranging the Placing
severally, and not jointly, nor jointly and severally, as agents of
the Company.
(c) Participation in the Placing will only be available to
persons who are Relevant Persons and who may lawfully be and are
invited to participate by any of the Joint Placing Agents.
(d) Any offer to subscribe for CULS should state the aggregate
nominal value of CULS which the Placee wishes to acquire or the
total monetary amount which it wishes to commit to acquire CULS at
the Placing Price.
(e) The Bookbuild is expected to close on 11 July 2019 but may
close earlier or later at the discretion of the Joint Placing
Agents and the Company. The timing of the closing of the books and
scaling back of any allocations will be agreed between the Joint
Placing Agents and the Company following completion of the
Bookbuild. The Joint Placing Agents may, in agreement with the
Company, accept offers to subscribe for CULS that are received
after the Bookbuild has closed.
(f) An offer to subscribe for CULS in the Bookbuild will be made
on the basis of these terms and conditions and the Placing Proof
and will be legally binding on the Placee by which, or on behalf of
which, it is made and will not be capable of variation or
revocation after the close of the Bookbuild.
(g) Subject to paragraph (e) above, the Joint Placing Agents
reserve the right not to accept an offer to subscribe for CULS,
either in whole or in part, on the basis of the Allocation Policy
and may scale down any offer to subscribe for CULS for this
purpose.
(h) Acceptance of any offer incorporating these terms and
conditions (whether orally or in writing or evidenced by way of a
trade confirmation) will constitute a legally binding commitment
upon such Placee in favour of the Joint Placing Agents to acquire
the amount of CULS they have agreed to subscribe for (subject to
scaling back at the option of the Joint Placing Agents as they in
their sole discretion shall determine). Each Placee will have an
immediate, separate, irrevocable and binding obligation owed to the
Joint Placing Agents to pay to the Joint Placing Agents (or as the
Joint Placing Agents may direct) as agent for the Company in
cleared funds an amount equal to the aggregate Placing Price in
respect of the CULS it has been agreed to subscribe for (subject to
scaling back as aforesaid).
(i) The Company will make a further announcement following the
close of the Bookbuild detailing the aggregate nominal value of the
CULS to be issued pursuant to the Placing (the "Placing Results
Announcement"). It is expected that such Placing Results
Announcement will be made as soon as practicable after the close of
the Bookbuild.
(j) Subject to paragraphs (g) and (h) above, the Joint Placing
Agents reserve the right not to accept offers to subscribe for CULS
or to accept offers to subscribe for CULS, either in whole or in
part, on the basis of allocations determined at the Joint Placing
Agents' discretion and may scale down any offers to subscribe for
CULS as the Joint Placing Agents may determine, subject to
agreement with the Company. The acceptance of offers to subscribe
for CULS shall be at the Joint Placing Agents' absolute discretion,
subject to agreement with the Company.
(k) Irrespective of the time at which a Placee's allocation(s)
pursuant to the Placing is/are confirmed, settlement for all CULS
to be acquired pursuant to the Placing will be required to be made
at the time specified by the Joint Placing Agents and all CULS to
be acquired pursuant to the Placing will be required to be made at
the later time specified, on the basis explained below under the
paragraph entitled "Registration and Settlement".
(l) No commissions are payable to Placees in respect of the Placing.
(m) By participating in the Bookbuild, 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. All obligations under
the Placing will be subject to the fulfilment of the Conditions (as
defined below) under the paragraph entitled "Conditions of the
Placing and Termination of the Placing Agreement".
Conditions of the Placing and Termination of the Placing
Agreement
Placees will only be called on to acquire CULS if the
obligations of the Joint Placing Agents under the Placing Agreement
have become unconditional in all respects and the Joint Placing
Agents have not terminated the Placing Agreement prior to
Admission.
The Joint Placing Agents' obligations under the Placing
Agreement in respect of the Placing are conditional upon, inter
alia:
(a) the Admission Particulars being approved by the London Stock
Exchange not later than 6.00 p.m. on the second Business Day
following the completion of the Bookbuild (or such later time
and/or date as the Company and the Joint Placing Agents may
agree);
(b) Admission occurring not later than 8.00 a.m. on 30 July 2019
(or such later time and/or date as the Company and the Joint
Placing Agents may agree not being later than 9 August 2019);
(c) the passing of the Resolutions (without amendment) at the
General Meeting on 29 July 2019 (or, with the Joint Placing Agents'
written consent (such consent not to be unreasonably withheld or
delayed), at any adjournment thereof);
(d) the warranties given by the Company to the Joint Placing
Agents as contained in the Placing Agreement being true, accurate
and not misleading on and as of the date of the Placing Agreement
and at all times between the date of the Placing Agreement and
Admission, by references to the facts and circumstances from time
to time subsisting;
(e) there not having occurred, in the opinion of either of the
Joint Placing Agents (acting in good faith), a material adverse
change affecting the condition of, or in the earnings, management,
business affairs, solvency or prospects of, (i) the Company or (ii)
the Group taken as a whole, in each case whether or not arising in
the ordinary course of business at any time prior to Admission;
and
(f) no supplementary Admission Particulars are published by the
Company prior to Admission which the Joint Placing Agents (in their
bona fide opinion, acting in good faith) consider to be material
and adverse in the context of the Placing.
(all such conditions included in the Placing Agreement being
together the "Conditions").
The Placing Agreement can be terminated at any time before
Admission by the Joint Placing Agents giving notice to the Company
in certain circumstances, including (but not limited to) where (a)
any Conditions are not satisfied in all material respects at the
required times (unless waived); and (b) there has been a breach by
the Company of any of the warranties, undertakings or covenants in
the Placing Agreement and in each case, the effect, in the good
faith opinion of the Joint Placing Agents, is singly or in the
aggregate material in the context of the Placing and/or is such as
to make it impracticable or inadvisable to proceed with the
Placing, Admission or to market or enforce contracts for the sale
of, any CULS.
If any Condition has not been satisfied, has not been waived by
the Joint Placing Agents or has become incapable of being satisfied
(and is not waived by the Joint Placing Agents as described below)
or if the Placing Agreement is terminated, all obligations under
these terms and conditions will automatically terminate. By
participating in the Placing, each Placee agrees that its rights
and obligations hereunder are conditional upon the Placing
Agreement becoming unconditional in all respects in respect of the
Placing and that its rights and obligations will terminate only in
the circumstances described above and will not be capable of
rescission or termination by it after oral or written confirmation
by the Joint Placing Agents (at the Joint Placing Agents'
discretion) following the close of the Bookbuild.
The Joint Placing Agents may in their absolute discretion in
writing waive fulfilment of certain of the Conditions or extend the
time provided for fulfilment of such Conditions. Any such extension
or waiver will not affect Placees' commitments as set out in these
terms and conditions.
By participating in the Placing each Placee agrees that the
exercise by the Company or the Joint Placing Agents of any right or
other discretion under the Placing Agreement shall be within the
absolute discretion of the Company and the Joint Placing Agents (as
the case may be) and that neither the Company nor the Joint Placing
Agents need make any reference to such Placee (or to any other
person whether acting on behalf of any Placee or otherwise) and
that neither the Company nor the Joint Placing Agents shall have
any liability to such Placee (or to any other person whether acting
on behalf of any Placee or otherwise) whatsoever in connection with
any such exercise.
Neither the Joint Placing Agents 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 made by
the Joint Placing Agents as to whether or not to waive or to extend
the time and/or date for the fulfilment of any Condition and/or
whether or not to exercise any termination right.
Placing Procedure
Placees will be notified of their allocations under the Placing
on or around 11 July 2019 (or such other time and/or date may be
notified).
Payment in full for any CULS allocated in respect of the Placing
at the Placing Price must be made by no later than 30 July 2019 (or
such other date as shall be notified to each Placee by the relevant
Placing Agent) on the closing date for the Placing (or such other
time and/or date as the Company and the Joint Placing Agents may
agree). The Joint Placing Agents will notify Placees if any of the
dates in these terms and conditions should change, including as a
result of delay in the posting of the Admission Particulars or the
production of supplementary Admission Particulars or otherwise.
Registration and Settlement
Settlement of transactions in the CULS following Admission will
take place within the CREST system, subject to certain exceptions.
The Joint Placing Agents and the Company reserve the right to
require settlement for, and delivery of, the CULS to Placees by
such other means that they deem necessary if delivery or settlement
is not possible within the CREST system within the timetable set
out in the Placing Proof or would not be consistent with the
regulatory requirements in the Placee's jurisdiction. Each Placee
will be deemed to agree that it will do all things necessary to
ensure that delivery and payment is completed in accordance with
either the standing CREST or certificated settlement instructions
which they have in place with the relevant Placing Agent.
Settlement for the Placing will be on a delivery versus payment
basis and settlement is expected to take place on 30 July 2019.
Interest is chargeable daily on payments to the extent that value
is received after the due date from Placees at the rate of 2
percentage points above prevailing LIBOR. Each Placee is deemed to
agree that if it does not comply with these obligations, the Joint
Placing Agents may sell any or all of the CULS allocated to it on
its behalf and retain from the proceeds, for its own account and
benefit, an amount equal to the aggregate amount owed by the Placee
plus any interest due. By communicating a bid for CULS, each Placee
confers on the Joint Placing Agents all such authorities and powers
necessary to carry out any such sale and agrees to ratify and
confirm all actions which the Joint Placing Agents lawfully take in
pursuance of such sale. The relevant Placee will, however, remain
liable for any shortfall below the aggregate amount owed by it and
may be required to bear any stamp duty or stamp duty reserve tax
(together with any interest or penalties) which may arise upon any
transaction in the CULS on such Placee's behalf.
If any of the Conditions are not fulfilled (or, where
appropriate, waived) the Joint Placing Agents will return any funds
received by them from Placees to the Placees.
Acceptance
By participating in the Placing, a Placee (and any person acting
on such Placee's behalf) irrevocably acknowledges, confirms,
undertakes, represents, warrants and agrees (as the case may be)
with the Joint Placing Agents and the Company, the following:
1. in consideration of its allocation of a placing
participation, to subscribe at the aggregate Placing Price for any
CULS comprised in its allocation for which it is required to
subscribe pursuant to these terms and conditions;
2. it has read and understood this Announcement (including these
terms and conditions) and the Placing Proof in their entirety and
that it has neither received nor relied on any information given or
any investigations, representations, warranties or statements made
at any time by any person in connection with Admission, the
Placing, the Company, the CULS, or otherwise, other than the
information contained in this Announcement (including these terms
and conditions) and the Placing Proof that in accepting the offer
of its placing participation it will be relying solely on the
information contained in this Announcement (including these terms
and conditions) and the Placing Proof, receipt of which is hereby
acknowledged, and undertakes not to redistribute or duplicate such
documents;
3. its oral commitment will be made solely on the basis of the
information set out in this Announcement and the Placing Proof and
the information publicly announced to a Regulatory Information
Service by or on behalf of the Company on the date of this
announcement, such information being all that such Placee deems
necessary or appropriate and sufficient to make an investment
decision in respect of the CULS and that it has neither received
nor relied on any other information given, or representations or
warranties or statements made, by the Joint Placing Agents or the
Company nor any of their respective affiliates and none of the
Joint Placing Agents or the Company will be liable for any Placee's
decision to participate in the Placing based on any other
information, representation, warranty or statement;
4. the content of this Announcement, these terms and conditions
and the Placing Proof are exclusively the responsibility of the
Company and agrees that the Joint Placing Agents nor any of their
respective affiliates nor any person acting on behalf of any of
such persons will be responsible for or shall have liability for
any information, representation or statements contained therein or
any information previously published by or on behalf of the
Company, and neither the Joint Placing Agents or Company, or any of
their respective affiliates or any person acting on behalf of any
such person will be responsible or liable for a Placee's decision
to accept its placing participation;
5. (i) it has not relied on, and will not rely on, any
information relating to the Company contained or which may be
contained in any research report or investor presentation prepared
or which may be prepared by any of the Joint Placing Agents or any
of their affiliates; (ii) none of the Joint Placing Agents, their
affiliates or any person acting on behalf of any of such persons
has or shall have any responsibility or liability for public
information relating to the Company; (iii) the Joint Placing
Agents, their affiliates or any person acting on behalf of any of
such persons has or shall have any responsibility or liability for
any additional information that has otherwise been made available
to it, whether at the date of publication of such information, the
date of these terms and conditions or otherwise; and that (iv) the
Joint Placing Agents, their affiliates or any person acting on
behalf of any of such persons make no representation or warranty,
express or implied, as to the truth, accuracy or completeness of
any such information referred to in (i) to (iii) above, whether at
the date of publication of such information, the date of this
Announcement or otherwise;
6. it has made its own assessment of the Company and has relied
on its own investigation of the business, financial or other
position of the Company in deciding to participate in the Placing,
and has satisfied itself concerning the relevant tax, legal,
currency and other economic considerations relevant to its decision
to participate in the Placing;
7. it is acting as principal only in respect of the Placing or,
if it is acting for any other person (i) it is duly authorised to
do so and has full power to make the acknowledgments,
representations and agreements herein on behalf of each such
person, (ii) it is and will remain liable to the Company and the
Joint Placing Agents for the performance of all its obligations as
a Placee in respect of the Placing (regardless of the fact that it
is acting for another person), (iii) if it is in the United
Kingdom, it is a person (a) who has professional experience in
matters relating to investments and who falls within the definition
of "investment professionals" in Article 19(5) of the Order or who
falls within Article 49(2) of the Order, and (b) is a "qualified
investor" as defined in section 86 of the FSMA, (iv) if it is in a
member state of the EEA, it is a "qualified investor" within the
meaning of Article 2(1)(e) of the Prospectus Directive, and (v) if
it is a financial intermediary, as that term is used in Article
3(2) of the Prospectus Directive, the CULS subscribed by it in the
Placings are not being acquired on a non-discretionary basis for,
or on behalf of, nor will they be acquired with a view to their
offer or resale to persons in a member state of the EEA in
circumstances which may give rise to an offer of shares to the
public, other than their offer or resale to qualified investors
within the meaning of Article 2(1)(e) of the Prospectus Directive
in a member state of the EEA which has implemented the Prospectus
Directive;
8. if it has received any confidential price sensitive
information about the Company in advance of the Placing, it has not
(i) dealt in the securities of the Company; (ii) encouraged or
required another person to deal in the securities of the Company;
or (iii) disclosed such information to any person, prior to the
information being made generally available;
9. it has complied with its obligations in connection with money
laundering and terrorist financing under the Proceeds of Crime Act
2002, the Terrorism Act 2000, the Terrorism Act 2006 and the Money
Laundering, Terrorist Financing and Transfer of Funds Regulations
2017 and the Criminal Justice (Money Laundering and Terrorism
Financing) Act 2010 and any related or similar rules, regulations
or guidelines, issued, administered or enforced by any government
agency having jurisdiction in respect thereof (the "Regulations")
and, if it is making payment on behalf of a third party, it has
obtained and recorded satisfactory evidence to verify the identity
of the third party as may be required by the Regulations;
10. it has only communicated or caused to be communicated and
will only communicate or cause to be communicated any invitation or
inducement to engage in investment activity (within the meaning of
section 21 of FSMA) relating to the CULS in circumstances in which
section 21(1) of FSMA does not require approval of the
communication by an authorised person;
11. it is not acting in concert (within the meaning given in the
City Code on Takeovers and Mergers) with any other Placee or any
other person in relation to the Company;
12. it has complied and will comply with all applicable
provisions of the FSMA with respect to anything done by it in
relation to the CULS in, from or otherwise involving the United
Kingdom;
13. it and any person acting on its behalf is entitled to
acquire the CULS under the laws of all relevant jurisdictions and
that it has all necessary capacity and has obtained all necessary
consents and authorities to enable it to commit to this
participation in the Placing and to perform its obligations in
relation thereto (including, without limitation, in the case of any
person on whose behalf it is acting, all necessary consents and
authorities to agree to the terms set out or referred to in these
terms and conditions);
14. unless otherwise agreed by the Company (after agreement with
the Joint Placing Agents), it is not, and at the time the CULS are
subscribed for and purchased will not be, subscribing for and on
behalf of a resident of Australia, Canada, Japan, New Zealand, the
Republic of South Africa or any other Excluded Jurisdiction and
further acknowledges that the CULS have not been and will not be
registered under the securities legislation of any Excluded
Jurisdiction and, subject to certain exceptions, may not be
offered, sold, transferred, delivered or distributed, directly or
indirectly, in or into those jurisdictions;
15. it does not expect the Joint Placing Agents to have any
duties or responsibilities towards it for providing protections
afforded to clients under the rules of the FCA Handbook (the
"Rules") or advising it with regard to the CULS and that it is not,
and will not be, a client of any of the Joint Placing Agents as
defined by the Rules. Likewise, any payment by it will not be
treated as client money governed by the Rules;
16. any exercise by the Joint Placing Agents of any right to
terminate the Placing Agreement or of other rights or discretions
under the Placing Agreement or the Placing shall be within the
Joint Placing Agents' absolute discretion and the Joint Placing
Agents shall not have any liability to it whatsoever in relation to
any decision to exercise or not to exercise any such right or the
timing thereof;
17. neither it, nor the person specified by it for registration
as a holder of CULS is, or is acting as nominee(s) or agent(s) for,
and that the CULS will not be allotted to, a person/person(s) whose
business either is or includes issuing depository receipts or the
provision of clearance services and therefore that the issue to the
Placee, or the person specified by the Placee for registration as
holder, of the CULS will not give rise to a liability under any of
sections 67, 70, 93 and 96 of the Finance Act 1986 (depositary
receipts and clearance services) and that the CULS are not being
acquired in connection with arrangements to issue depository
receipts or to issue or transfer CULS into a clearance system;
18. the person who it specifies for registration as holder of
the CULS will be (i) itself or (ii) its nominee, as the case may
be, and acknowledges that the Joint Placing Agents and the Company
will not be responsible for any liability to pay stamp duty or
stamp duty reserve tax (together with interest and penalties)
resulting from a failure to observe this requirement; and each
Placee and any person acting on behalf of such Placee agrees to
participate in the Placing on the basis that the CULS will be
allotted to a CREST stock account of one of the Joint Placing
Agents who will hold them as nominee on behalf of the Placee until
settlement in accordance with its standing settlement instructions
with it;
19. where it is acquiring CULS for one or more managed accounts,
it is authorised in writing by each managed account to acquire CULS
for that managed account;
20. if it is a pension fund or investment company, its
acquisition of any CULS is in full compliance with applicable laws
and regulations;
21. it has not offered or sold and will not offer or sell any
CULS 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;
22. it has not offered or sold and will not offer or sell any
CULS to persons in any member state of the EEA prior to Admission
except to persons whose ordinary activities involve them acquiring,
holding, managing or disposing of investments (as principal or
agent) for the purpose of their business or otherwise in
circumstances which have not resulted and will not result in an
offer to the public in any member state of the EEA within the
meaning of the Prospectus Directive;
23. participation in the Placing is on the basis that it is not
and will not be a client of either of the Joint Placing Agents and
that the Joint Placing Agents will have no duties or
responsibilities to it for providing the protections afforded to
their clients nor for providing advice in relation to the Placing
nor in respect of any representations, warranties, undertakings or
indemnities contained in the Placing Agreement or the contents of
these terms and conditions;
24. to provide the Joint Placing Agents with such relevant
documents as they may reasonably request to comply with requests or
requirements that either they or the Company may receive from
relevant regulators in relation to the Placing, subject to its
legal, regulatory and compliance requirements and restrictions;
25. any agreements entered into by it pursuant to these terms
and conditions shall be governed by and construed in accordance
with the laws of England and Wales and it submits (on its behalf
and on behalf of any Placee on whose behalf it is acting) to the
exclusive jurisdiction of the English courts as regards any claim,
dispute or matter arising out of any such contract, except that
enforcement proceedings in respect of the obligation to make
payment for the CULS (together with any interest chargeable
thereon) may be taken by the Joint Placing Agents 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;
26. to fully and effectively indemnify and hold harmless the
Company and each of the Joint Placing Agents and each of their
respective affiliates, subsidiaries, branches, associates and
holding companies, and in each case their respective directors,
employees, officers and agents (each, an "Indemnified Person") from
and against any and all losses, claims, damages, liabilities and
expenses (including legal fees and expenses) ("Losses") (i) arising
from any breach by such Placee of any of the provisions of these
terms and conditions and (ii) incurred by any Indemnified Person
arising from the performance of the Placee's obligations as set out
in these terms and conditions;
27. to indemnify on an after-tax basis and hold the Company and
each of the Joint Placing Agents and any of their affiliates and
any person acting on their behalf harmless from any and all losses,
claims, damages, liabilities and expenses (including legal fees and
expenses) arising out of or in connection with any breach of the
representations, warranties, acknowledgments, agreements and
undertakings in these terms and conditions and further agrees that
the provisions of these terms and conditions shall survive after
completion of the Placing;
28. in making any decision to subscribe for the CULS, (i) it has
knowledge and experience in financial, business and international
investment matters as is required to evaluate the merits and risks
of acquiring the CULS; (ii) 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; (iii) it
has relied on its own examination, due diligence and analysis of
the Company and its affiliates taken as a whole (including the
markets in which the Group operates) and the terms of the Placing
(including the merits and risks involved); (iv) it has had
sufficient time to consider and conduct its own investigation with
respect to the offer and subscribe for the CULS, including the
legal, regulatory, tax, business, currency and other economic and
financial considerations relevant to such investment and (v) will
not look to the Joint Placing Agents, any of their respective
affiliates or any person acting on their behalf for all or part of
any such loss or losses it or they may suffer;
29. the Joint Placing Agents and the Company and their
respective affiliates and others will rely upon the truth and
accuracy of the foregoing representations, warranties,
acknowledgments and undertakings which are irrevocable;
30. its commitment to acquire CULS 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 Joint Placing Agents' conduct of the
Placing; and
31. its commitment to acquire CULS will continue notwithstanding
any non-material changes (materially to be determined by the Joint
Placing Agents in their discretion) between the Placing Proof and
the final Admission Particulars as published.
Please also note that the agreement to allot and issue CULS to
Placees (or the persons for whom Placees are contracting as agent)
free of stamp duty and stamp duty reserve tax in the UK relates
only to their issue to Placees, or such persons as they nominate as
their agents, direct from the Company for the CULS in question.
Such agreement assumes that such CULS are not being acquired in
connection with arrangements to issue depositary receipts or to
transfer such CULS into a clearance service. If there were any such
arrangements, or the settlement related to other dealing in such
CULS, stamp duty or stamp duty reserve tax may be payable, for
which neither the Company nor the Joint Placing Agents would be
responsible and Placees shall indemnify the Company and the Joint
Placing Agents on an after-tax basis for any stamp duty or stamp
duty reserve tax paid by them in respect of any such arrangements
or dealings. Furthermore, each Placee agrees to indemnify on an
after-tax basis and hold each of the Joint Placing Agents and/or
the Company and their respective affiliates harmless from any and
all interest, fines or penalties in relation to stamp duty, stamp
duty reserve tax and all other similar duties or taxes to the
extent that such interest, fines or penalties arise from the
unreasonable default or delay of that Placee or its agent. If this
is the case, it would be sensible for Placees to take their own
advice and they should notify the relevant Bank 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 UK by them or any other person on the
acquisition by them of any CULS or the agreement by them to acquire
any CULS.
Selling Restrictions
By participating in the Placing, a Placee (and any person acting
on such Placee's behalf) irrevocably acknowledges, confirms,
undertakes, represents, warrants and agrees (as the case may be)
with the Joint Placing Agents and the Company, the following:
1. it is not a person who has a registered address in, or is a
resident, citizen or national of, a country or countries, in which
it is unlawful to make or accept an offer to subscribe for
CULS;
2. it has fully observed and will fully observe the applicable
laws of any relevant territory, including complying with the
selling restrictions set out herein and obtaining any requisite
governmental or other consents and it has fully observed and will
fully observe any other requisite formalities and pay any issue,
transfer or other taxes due in such territories;
3. if it is in the United Kingdom, it is a person (i) who has
professional experience in matters relating to investments and who
falls within the definition of "investment professionals" in
Article 19(5) of the Order or who falls within Article 49(2) of the
Order, and (ii) is a "qualified investor" as defined in section 86
of the FSMA;
4. if it is in a member state of the EEA, it is a "qualified
investor" within the meaning of Article 2(1)(e) of the Prospectus
Directive;
5. it is a person whose ordinary activities involve it (as
principal or agent) in acquiring, holding, managing or disposing of
investments for the purpose of its business and it undertakes that
it will (as principal or agent) acquire, hold, manage or dispose of
any CULS that are allocated to it for the purposes of its
business;
6. it is and, at the time the CULS are purchased, will be either
(i) outside the United States, purchasing in an offshore
transaction pursuant to Regulation S or (ii) a QIB that makes each
of the representations, warranties, acknowledgments and agreements
set out in paragraph 9 below;
7. none of the CULS have been or will be registered under the
Securities Act or with any securities regulatory authority of any
state or other jurisdiction of the United States;
8. none of the CULS may be offered, sold, taken up or delivered
directly or indirectly, in whole or in part, into or within 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;
9. if it is in the United States, (i) it is a QIB and is
acquiring the CULS for its own account or for the account of one or
more QIBs with respect to whom it has the authority to make, and
does make, the representations and warranties set forth herein, for
investment purposes and not with a view to further distribution of
such CULS; (ii) it is aware, and each beneficial owner of the CULS
has been advised, that the sale of CULS to it is in reliance on
Rule 144A or another exemption from the registration requirements
of the Securities Act; (ii) it will only offer, resell, pledge or
otherwise transfer the CULS (a) to a person that the seller and any
person acting on its behalf reasonably believes is a QIB purchasing
for its own account or for the account of a QIB in a transaction
meeting the requirements of Rule 144A, (b) outside the United
States in accordance with Regulation S under the Securities Act,
(c) pursuant to an exemption from registration under the Securities
Act provided by Rule 144 thereunder (if available), or (d) pursuant
to an effective registration statement under the Securities Act, in
each case in accordance with any applicable securities laws of any
state or other jurisdiction of the United States; and (iii)
notwithstanding anything to the contrary, it understands that CULS
may not be deposited into any unrestricted depositary receipt
facility in respect of CULS established or maintained by a
depositary bank unless and until such time as such CULS are no
longer "restricted securities" within the meaning of Rule 144(a)(3)
under the Securities Act; and
10. it (on its behalf and on behalf of any Placee on whose
behalf it is acting) has (a) fully observed the laws of all
relevant jurisdictions which apply to it; (b) obtained all
governmental and other consents which may be required; (c) fully
observed any other requisite formalities; (d) paid or will pay any
issue, transfer or other taxes; (e) not taken any action which will
or may result in the Company or the Joint Placing Agents (or any of
them) being in breach of a legal or regulatory requirement of any
territory in connection with the Equity Placings; (f) obtained all
other necessary consents and authorities required to enable it to
give its commitment to subscribe for the relevant CULS; and (g) the
power and capacity to, and will, perform its obligations under the
terms contained in these terms and conditions.
Miscellaneous
The Company reserves the right to treat as invalid any
application or purported application for CULS that appears to the
Company or its agents to have been executed, effected or dispatched
from the United States or an Excluded Jurisdiction or in a manner
that may involve a breach of the laws or regulations of any
jurisdiction or if the Company or its agents believe that the same
may violate applicable legal or regulatory requirements or if it
provides an address for delivery of the certificates in respect of
the CULS in or in the case of a stock account in CREST, to a CREST
member whose registered address would be in, an Excluded
Jurisdiction or the United States, or any other jurisdiction
outside the United Kingdom in which it would be unlawful to deliver
such certificates or make such a credit.
When a Placee or person acting on behalf of the Placee is
dealing with any of the Joint Placing Agents, any money held in an
account with any of the Joint Placing Agents 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 rules and
regulations of the FCA made under the FSMA. The 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 Joint Placing Agents' money in accordance with
the client money rules and will be used by each of the Joint
Placing Agents in the course of its own business; and the Placee
will rank only as a general creditor of the relevant Placing
Agent.
Times
Unless the context otherwise requires, all references to time
are to London time. All times and dates in these terms and
conditions may be subject to amendment. The Joint Placing Agents
will notify Placees and any persons acting on behalf of the Placees
of any changes.
Appendix III
Definitions
"Admission" admission of the CULS to be issued
pursuant to the Placing to trading
on the London Stock Exchange's International
Securities Market becoming effective
in accordance with the LSE Admission
Standards
"Allocation Policy" the allocation of CULS amongst Placees
agreed between the Company and the
Joint Placing Agents following completion
of the Bookbuild
"AIM" the market of that name operated
by the London Stock Exchange
"Board" the directors of the Company
"Bookbuild" the bookbuild process being the
manner in which the Placing is being
conducted
"Business Day" a day on which banks generally are
open for business in London, excluding
Saturdays and Sundays
"Companies Act" the Companies Act 2006 as amended
from time to time
"Conversion Rights" the rights for the conversion of
the CULS into Ordinary Shares in
accordance with the conditions of
the Trust Deed
"CREST" the relevant system (as defined
in the CREST Regulations) in respect
of which Euroclear UK & Ireland
Limited is the Operator (as defined
in the CREST Regulations)
"CREST Regulations" the Uncertificated Securities Regulations
2001, (S.I. 2001 No. 3755), as amended
from time to time
"CULS Holders" the person(s) entered in the CULS
Register as the holders of the CULS
"CULS Register" the register in respect of the CULS
"EBITDA" earnings before interest, tax, depreciation
and amortization
"Excluded Jurisdiction" the United States, Australia, Canada,
Japan, New Zealand or the Republic
of South Africa or any other state
or jurisdiction where the offer
or sale of the securities referred
to in this Announcement is not permitted
"Group" AFH Financial Group plc and its
subsidiaries from time to time
"Joint Placing Agent(s)" Liberum and Shore Capital
"London Stock Exchange" the London Stock Exchange plc
"Mid Market Price" the closing middle market price
of an Ordinary Share (as derived
from the Stock Exchange Daily Official
List or any other record of daily
prices approved in writing by the
Trustee)
"Ordinary Shares" ordinary shares having a nominal
value of 10 pence each in the capital
of the Company
"Regulatory Information a primary information provider or
Service" an incoming information society
service, established in an EEA state
other than the UK, that disseminates
regulated information in accordance
with the minimum standards set out
in Article 12 of the TD implementing
Directive
"Resolutions" the resolutions to be approved at
the General Meeting
"Placing Agreement" the placing agreement between the
Company and the Joint Placing Agents
dated 28 June 2019
"Shareholders" or "Ordinary holders of Ordinary Shares
Shareholders"
"Trustee" the trustee for the time being of
the CULS, which on issue of the
CULS shall be The Law Debenture
Trust Corporation PLC
"Trust Deed" the trust deed to be entered into
between the Company and the Trustee
constituting the CULS
"United States" the United States of America, its
territories and possessions, any
state of the United States and the
District of Columbia
[1] Underlying excludes amortisation of intangible assets
arising on business combinations and the non-cash charge/credit for
share based payment costs
This information is provided by RNS, the news service of the
London Stock Exchange. RNS is approved by the Financial Conduct
Authority to act as a Primary Information Provider in the United
Kingdom. Terms and conditions relating to the use and distribution
of this information may apply. For further information, please
contact rns@lseg.com or visit www.rns.com.
END
MSCLDLLLKQFXBBF
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June 28, 2019 02:01 ET (06:01 GMT)
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