TIDMFLO
RNS Number : 0738Z
Flowtech Fluidpower PLC
09 March 2017
9 March 2017
THIS ANNOUNCEMENT AND THE INFORMATION CONTAINED HEREIN IS
RESTRICTED AND IS NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, IN
WHOLE OR IN PART, DIRECTLY OR INDIRECTLY, IN, INTO OR FROM THE
UNITED STATES, AUSTRALIA, CANADA, JAPAN, THE REPUBLIC OF SOUTH
AFRICA, THE REPUBLIC OF IRELAND, NEW ZEALAND OR ANY OTHER
JURISDICTION IN WHICH SUCH RELEASE, PUBLICATION OR DISTRIBUTION
WOULD BE UNLAWFUL.
THIS ANNOUNCEMENT IS FOR INFORMATION PURPOSES ONLY AND DOES NOT
CONSTITUTE OR CONTAIN ANY INVITATION, SOLICITATION, RECOMMATION,
OFFER OR ADVICE TO ANY PERSON TO SUBSCRIBE FOR, OTHERWISE ACQUIRE
OR DISPOSE OF ANY SECURITIES IN FLOWTECH FLUIDPOWER PLC OR ANY
OTHER ENTITY IN ANY JURISDICTION.
This announcement contains inside information
Flowtech Fluidpower plc
("Flowtech", the "Group" or the "Company")
Proposed Accelerated Bookbuild to raise up to GBP10 million
Flowtech (AIM: FLO), the specialist technical fluid power
products supplier, announces a proposed fundraising of up to GBP10
million, by way of the conditional placing ("Placing") of Placing
Shares at a price of 120 pence per share (the "Issue Price") with
existing and new institutional and other investors. If approved by
Shareholders the Placing Shares to be issued pursuant to the
proposed Placing are expected to represent approximately 16.2 per
cent. of the Enlarged Issued Share Capital of the Company. The
Placing Shares will rank pari passu in all other respects with the
Company's Existing Ordinary Shares.
The Placing Shares are being offered by way of an accelerated
bookbuild ("Bookbuild"), which will be launched immediately
following this announcement. Zeus Capital and finnCap will be
acting as joint bookrunners in connection with the Bookbuild.
The Placing is subject to the terms and conditions set out in
the appendix (the "Appendix") to this announcement (which forms
part of this announcement, such announcement and the Appendix
together being, this "Announcement"). The Placing is not
underwritten.
It is expected that the implementation of the proposed Placing
will commence immediately following this announcement and a further
announcement will be made to confirm its completion in due
course.
The proposed Placing will be subject to the passing of certain
resolutions for which Shareholder approval will be sought at the
General Meeting of the Company, which is expected to be convened
shortly by the posting to Shareholders of a circular containing
notice of the meeting.
The Directors intend to use the proceeds of the Placing to fund
future acquisitions.
Additional information on the Placing is included below.
This announcement contains inside information for the purposes
of Article 7 of EU Regulation 596/2014 ("MAR"). In addition, market
soundings (as defined in MAR) were taken in respect of the Placing
with the result that certain persons became aware of inside
information (as defined in MAR), as permitted by MAR. This inside
information is set out in this Announcement. Therefore, those
persons that received inside information in a market sounding are
no longer in possession of such inside information relating to the
Company and its securities.
For further information please visit www.flowtechfluidpower.com
or contact:
Flowtech Fluidpower plc
Sean Fennon, CEO
Bryce Brooks, CFO +44 (0)1695 52759
Zeus Capital
(Nominated Adviser & Joint Broker)
Andrew Jones / Jonathan Sharp (Corporate
Finance)
Dominic King (Broking) +44 (0)20 3829 5000
finnCap
(Joint Broker)
Ed Frisby / Kate Bannatyne (Corporate Finance)
Rhys Williams / Emily Morris (Sales and
Broking) +44 (0)20 7220 0500
Media enquiries:
TooleyStreet Communications
Fiona Tooley +44 (0)7785 703523
About Flowtech Fluidpower plc:
Flowtech Fluidpower plc, founded as Flowtech in 1983, is the
UK's leading specialist supplier of technical fluid power products.
The Group has three divisions: Flowtechnology, Power Motion Control
and Process. All three of the Group's divisions have overlapping
product sets, allowing procurement synergies to be maximised.
The Flowtechnology division focuses on supplying distributors
and resellers of industrial MRO (maintenance, repair and operation)
products, primarily serving urgent orders rather than bulk
offerings. It is formed from Flowtechnology UK, Flowtechnology
Benelux and Indequip. It offers an unrivalled range of Original
Equipment Manufacturer (OEM) and Exclusive Brand products to over
3,400 distributors and resellers and the catalogues are recognised
as the definitive source for fluid power products, containing
100,000 individual product lines and are distributed to more than
80,000 industrial Maintenance, Repair and Overhaul end users (MRO).
The Power Motion Control division specialises in the design,
assembly and supply of engineering components and hydraulic systems
and is further enhanced by a service and repair function. The
division is formed from Primary Fluid Power, Nelson Hydraulics, TSL
Fluidpower and HTL. The Process division focuses on the supply of
industrial components to the process sectors.
The Group's main distribution centre is in Skelmersdale,
Lancashire with further distribution centres in the Netherlands and
China. The Power Motion Control division (PMC) has operations in
Merseyside, Northern Ireland, the Republic of Ireland, Yorkshire
and Shropshire; Process operates from the West Midlands. In total
the business employs 349 people.
Additional information on the Placing
1. Background to and reasons for the Placing and use of proceeds
The Company's long term growth model is based on both organic
growth, coupled with complementary acquisitions in the UK and
Europe in a fragmented market place. Since its admission to AIM on
21 May 2014, the Company has completed seven acquisitions:
-- Primary Fluid Power Limited, completed on 4 August 2014;
-- Albroco Limited, completed on 29 May 2015;
-- Nelson Hydraulics Limited, completed on 3 July 2015;
-- Indequip Limited, completed on 19 February 2016;
-- Hydravalve Limited, completed on 18 March 2016;
-- Triple Six Limited, completed on 29 July 2016; and
-- Hydraulics and Transmissions Limited, completed on 21 January 2017.
The Directors believe that these acquisitions have been
integrated successfully and are all delivering benefits to the
Company.
The Directors have identified over 25 acquisition targets, some
of which they are in active discussions with. These targets are
located in the UK and mainland Europe, across the Flowtechnology,
Power Motion Control, and Process divisions.
The acquisitions to date have been funded through a combination
of cash reserves and existing debt facilities. In order to keep the
business appropriately leveraged the board have considered a
variety of funding options, including an equity and convertible
debt package, to fund the acquisition pipeline in the short to
medium term. The Directors believe that it is in the best interests
of the Company and the Shareholders to fund the acquisition
pipeline through the Placing and may in future seek additional debt
funding, whilst considering the overall level of leverage.
2. Current trading and outlook
On 23 January 2017 the Company announced a trading update on its
performance for the year ended 31 December 2016. The key highlights
of the announcement are summarised as follows:
-- Group revenue was c.19.9% up on 2015 at approximately
c.GBP53.7 million (c.19.3% in constant currency)
-- British Fluid Power Distributors Association Market Survey
indicates 2016 fluid power overall distributor sales growth was
negative 3.9% (hydraulics -5.9%, pneumatics +0.2%)
-- Post Brexit currency movements with resultant impact on input
prices have to date been successfully passed on to customers due to
our flexible pricing model, with 2016 exit margins maintained.
However, some margin contraction was experienced in H2 while prices
were managed upwards on products sourced in Euro and USD and sold
in GBP markets
-- Three acquisitions successfully integrated into the Group,
each delivering benefits, and a third "Process" division
established focused on process industries, including Pharma,
Environmental, and Steam
-- Net debt at year end was c.GBP13.0 million
-- Investment in central and sales resources aimed at optimising
cross channel opportunities, and future acquisition integration
programme underpinning long term growth
-- As a result of these investments and the gross margin
contraction in H2, the Board expects underlying PBT will be in the
range GBP7.0m to GBP7.2m.
The Directors are pleased to report that the Company continues
to trade in line with current market expectations and they remain
confident in the Company's performance and future.
3. Details of the Placing
Structure
The Directors have given careful consideration as to the
structure of the proposed fundraising and have concluded that the
Placing is the most suitable option available to the Company and
its Shareholders at this time.
Placing Shares will be issued through the Placing at 120 pence
per Placing Share to raise gross proceeds of approximately GBP10
million.
Principal terms of the Placing
The Company is proposing to issue Placing Shares pursuant to the
Placing. In accordance with the terms of the Placing Agreement,
Zeus Capital and finnCap have, as agents for the Company,
conditionally placed, with institutional and other investors, the
Placing Shares at the Issue Price to raise approximately GBP10
million.
The Placing is not being underwritten.
Under the Placing Agreement, the Company has agreed to pay to
Zeus Capital and finnCap a fixed sum together with a commission
based on the aggregate value of certain of the Placing Shares
placed at the Issue Price and the costs and expenses of the Placing
together with any applicable VAT.
Conditionality
The Placing is conditional, inter alia, upon the following:
-- the passing, without amendment, of resolutions 1 and 3 of the
Resolutions at the General Meeting;
-- Admission occurring by no later than 8:00 a.m. on 30 March
2017 (or such later times and/or dates as may be agreed between the
Company, Zeus Capital and finnCap, being no later than 5:00 p.m. on
28 April 2017); and
-- the Placing Agreement becoming unconditional in all respects
(save for the condition relating to Admission) and not having been
terminated in accordance with its terms.
If the conditions set out above are not satisfied or waived
(where capable of waiver), the Placing will lapse and the Placing
Shares will not be issued and all monies received from investors in
respect of the Placing Shares will be returned to them (at the
investors' risk and without interest) as soon as possible
thereafter.
Application for Admission
Application will be made to the London Stock Exchange for the
Placing Shares to be admitted to trading on AIM. Admission of the
Placing Shares is expected to take place, and dealings on AIM are
expected to commence, at 8:00 a.m. on 30 March 2017 (or such later
time and/or dates as may be agreed between the Company, Zeus
Capital and finnCap). No temporary document of title will be
issued.
The Placing Shares will, following Admission, rank pari passu in
all respects with the Existing Ordinary Shares in issue at the date
of this document and will carry the right to receive all dividends
and distributions declared, made or paid on or in respect of the
Ordinary Shares after Admission.
4. Effect of the Placing
Upon completion of the Placing the Placing Shares will represent
approximately 16.2 per cent. of the Enlarged Share Capital.
5. The Placing Agreement
Pursuant to the terms of the Placing Agreement, Zeus Capital and
finnCap, as agents for the Company, have agreed to use their
reasonable endeavours to procure subscribers for the Placing Shares
at the Issue Price. The Placing Agreement is conditional upon,
among other things, the conditions set out above and none of the
warranties or undertakings given to Zeus Capital and finnCap prior
to Admission being or becoming untrue, inaccurate or misleading in
any material respect.
The Placing Agreement contains customary warranties given by the
Company in favour of Zeus Capital and finnCap in relation to, inter
alia, the accuracy of the information in this document and other
matters relating to the Group and its business. In addition, the
Company has agreed to indemnify Zeus Capital and finnCap (and their
affiliates) in relation to certain liabilities which they may incur
in respect of the Placing.
Zeus Capital and finnCap have the right to terminate the Placing
Agreement in certain circumstances prior to Admission. In
particular, in the event of a material breach of the warranties or
a material adverse change or if the Placing Agreement does not
become unconditional.
6. General Meeting
For the purposes of effecting the Placing, the Resolutions will
be proposed at the General Meeting.
The full text of the Resolutions will be set out in the Notice
of General Meeting that will be posted shortly after the result of
the accelerated bookbuild is announced.
Forward-looking statements
This announcement contains statements about Flowtech that are or
may be deemed to be "forward-looking statements".
All statements, other than statements of historical facts,
included in this announcement may be forward-looking statements.
Without limitation, any statements preceded or followed by, or that
include, the words "targets", "plans", "believes", "expects",
"aims", "intends", "will", "may", "should", "anticipates",
"estimates", "projects", "would", "could", "continue" or words or
terms of similar substance or the negative thereof, are
forward-looking statements. Forward-looking statements include,
without limitation, statements relating to the following: (i)
future capital expenditures, expenses, revenues, earnings,
synergies, economic performance, indebtedness, financial condition,
dividend policy, losses and future prospects and (ii) business and
management strategies and the expansion and growth of the
operations of Flowtech.
These forward-looking statements are not guarantees of future
performance. These forward-looking statements involve known and
unknown risks, uncertainties and other factors which may cause the
actual results, performance or achievements of any such person, or
industry results, to be materially different from any results,
performance or achievements expressed or implied by such
forward-looking statements. These forward-looking statements are
based on numerous assumptions regarding the present and future
business strategies of such persons and the environment in which
each will operate in the future. Investors should not place undue
reliance on such forward-looking statements and, save as is
required by law or regulation (including to meet the requirements
of the AIM Rules, the Prospectus Rules and/or the FSMA), Flowtech
does not undertake any obligation to update publicly or revise any
forward-looking statements (including to reflect any change in
expectations with regard thereto or any change in events,
conditions or circumstances on which any such statement is based).
All subsequent oral or written forward-looking statements
attributed to Flowtech or any persons acting on their behalf are
expressly qualified in their entirety by the cautionary statement
above. All forward-looking statements contained in this
announcement are based on information available to the Directors of
Flowtech at the date of this announcement, unless some other time
is specified in relation to them, and the posting or receipt of
this announcement shall not give rise to any implication that there
has been no change in the facts set forth herein since such
date.
Important Information
This Announcement or any part of it does not constitute or form
part of any offer to issue or sell, or the solicitation of an offer
to acquire, purchase or subscribe for, any securities in the United
States (including its territories and possessions, any state of the
United States and the District of Columbia), Canada, Australia, the
Republic of South Africa, Japan, Jersey or any other jurisdiction
in which the same would be unlawful. No public offering of the
Placing Shares is being made in any such jurisdiction.
All offers of the Placing Shares will be made pursuant to an
exemption under the Prospectus Directive from the requirement to
produce a prospectus. In the United Kingdom, this Announcement is
being directed solely at persons in circumstances in which section
21(1) of the Financial Services and Markets Act 2000 (as amended)
(the "FSMA") does not apply.
The Placing Shares have not been approved or disapproved by the
US Securities and Exchange Commission, any state securities
commission or other regulatory authority in the United States, nor
have any of the foregoing authorities passed upon or endorsed the
merits of the Placing or the accuracy or adequacy of this
Announcement. Any representation to the contrary is a criminal
offence in the United States. The relevant clearances have not
been, nor will they be, obtained from the securities commission of
any province or territory of Canada, no prospectus has been lodged
with, or registered by, the Australian Securities and Investments
Commission or the Japanese Ministry of Finance; the relevant
clearances have not been, and will not be, obtained for the South
Africa Reserve Bank or any other applicable body in the Republic of
South Africa in relation to the Placing Shares and the Placing
Shares have not been, nor will they be, registered under or
offering in compliance with the securities laws of any state,
province or territory of Australia, Canada, Japan, Jersey or the
Republic of South Africa. Accordingly, the Placing Shares may not
(unless an exemption under the relevant securities laws is
applicable) be offered, sold, resold or delivered, directly or
indirectly, in or into Australia, Canada, Japan, Jersey or the
Republic of South Africa or any other jurisdiction outside the
United Kingdom.
EXPECTED TIMETABLE OF PRINCIPAL EVENTS
Announcement of the Placing 9 March 2017
Despatch of the Circular 13 March 2017
and the Form of Proxy
Latest time and date for 11:00am on 27 March
receipt of Forms of Proxy 2017
for the General Meeting
General Meeting 11.00am on 29 March
2017
Admission of the Placing 8:00am on 30 March 2017
Shares to trading on AIM
APPIX - TERMS AND CONDITIONS OF THE PLACING
IMPORTANT INFORMATION FOR INVITED PLACEES ONLY
1. Introduction
An investment in the Placing Shares is subject to a number of
risks. Before making an investment decision with respect to the
Placing Shares, prospective investors should carefully consider the
risks associated with an investment in the Company, the Company's
business and the industry in which the Company operates, in
addition to all of the other information set out in this
document.
EACH PLACEE SHOULD CONSULT WITH ITS ADVISERS AS TO LEGAL, TAX,
BUSINESS AND RELATED ASPECTS OF AN INVESTMENT IN PLACING SHARES.
THE DISTRIBUTION OF THIS ANNOUNCEMENT, ANY PART OF IT OR ANY
INFORMATION CONTAINED IN IT MAY BE RESTRICTED BY LAW IN CERTAIN
JURISDICTIONS, AND ANY PERSON INTO WHOSE POSSESSION THIS
ANNOUNCEMENT, ANY PART OF IT OR ANY INFORMATION CONTAINED IN IT
COMES SHOULD INFORM THEMSELVES ABOUT, AND OBSERVE, SUCH
RESTRICTIONS.
All information in this document, including the terms and
conditions of the Placing in this Appendix, is directed only at
persons ("FSMA Qualified Investors") who are both "qualified
investors" as referred to at section 86(7) of the Financial
Services and Markets Act 2000 ("FSMA") and are persons at or to
whom any private communication relating to the Company that is a
"financial promotion" (as such term is used in relation to FSMA)
may lawfully be issued, directed or otherwise communicated without
the need for it to be approved, made or directed by an "authorised
person" as referred to in FSMA.
2. Placing
Each of Zeus Capital and finnCap is acting as the Company's
agent in respect of the Placing. Zeus Capital and finnCap shall
determine the extent of each Placee's participation in the Placing,
which will not necessarily be the same for each Placee. No
commissions will be paid to or by Placees in respect of their
agreement to subscribe for any Placing Shares.
Each Placee will be required to pay to finnCap, on the Company's
behalf as agent, the Placing Price as the subscription sum for each
Placing Share that it is required to subscribe for in accordance
with the terms set out in or referred to in this Appendix. Each
Placee's obligation to subscribe and pay for Placing Shares under
the Placing will be owed to each of the Company and finnCap. Each
Placee will be deemed to have read this Appendix in its entirety.
Neither of the Brokers nor any other Broker Person will have any
liability (subject to applicable legislation and regulations) to
Placees or to any person other than the Company in respect of the
Placing.
Various dates referred to in this document are stated on the
basis of the expected timetable for the Placing. It is possible
that some of these dates may be changed. The Impact Announcement is
expected to be released on 10 March 2017. The expected date for
Admission is 30 March 2017 and, in any event, the latest date for
Admission is 28 April 2017 ("the Long Stop Date").
Placees' commitments in respect of Placing Shares will be made
solely on the basis of the information contained in this document
and on the terms contained in it. No admission document for the
purposes of the AIM Rules for Companies, or prospectus, is required
to be published, or has been or shall be published, in relation to
the Placing or the Placing Shares.
3. Participation and settlement
Participation in the Placing is only available to persons who
are invited to participate in it by finnCap and/or Zeus
Capital.
A Placee's commitment to subscribe for a fixed number of Placing
Shares under the Placing will be agreed orally (or, if agreed
previously, may be confirmed orally) with finnCap on or before the
time on which the Impact Announcement is made. Such agreement will
constitute a legally binding commitment on such Placee's part to
subscribe for that number of Placing Shares at the Placing Price on
the terms and subject to the conditions set out or referred to in
this Appendix and subject to the Company's constitution. After such
agreement is entered into a contract note will be dispatched to the
Placee by finnCap stating (i) the number of Placing Shares for
which such Placee has agreed to subscribe, (ii) the aggregate
amount such Placee will be required to pay for those Placing
Shares, (iii) relevant settlement information and (iv) settlement
instructions. A settlement instruction form will be included in
each contract note and, on receipt, should be completed and
returned by the date and time stated in it.
Settlement of transactions in the Placing Shares will take place
within the CREST system, subject to certain exceptions, on a
"delivery versus payment" (or "DVP") basis. finnCap reserves the
right to require settlement for and/or delivery to any Placee of
any Placing Shares by such other means as it may deem appropriate
if delivery or settlement is not possible or practicable within the
CREST system within the timetable set out in this document or the
Impact Announcement.
A Placee whose Placing Shares are to be delivered to a custodian
or settlement agent should ensure that the written confirmation is
copied and delivered promptly to the appropriate person within that
organisation.
4. Placing Agreement
Zeus Capital and finnCap have entered into the Placing Agreement
with the Company under which each of Zeus Capital and finnCap has
agreed on a conditional basis to use their respective reasonable
endeavours as the Company's agents to procure subscribers at the
Placing Price for all Placing Shares.
5. Placing conditions
The Placing is conditional on (i) the release of the Impact
Announcement through the London Stock Exchange's Regulatory News
Service (or another regulatory information service, as that term is
used in the AIM Rules for Companies), (ii) the passing of one or
more resolutions at a general meeting of the Company to be proposed
in the notice of that meeting that is to be included in the
Company's circular to its shareholders concerning the Placing and
related matters, (iii) each of Zeus Capital's and finnCap's
obligations under the Placing Agreement not being terminated in
accordance with its terms, (vi) Admission taking place by the
relevant time and date to be stated in the Impact Announcement, and
(vii) each of Zeus Capital's and finnCap's obligations under the
Placing Agreement becoming unconditional in all other respects.
Zeus Capital and finnCap may extend the time and/or date for the
fulfilment of any of the conditions referred to above to a time no
later than 5.00 p.m. on the Long Stop Date. If any such condition
is not fulfilled (and, if capable of waiver under the Placing
Agreement, is not waived by Zeus Capital and finnCap) by the
relevant time, the Placing will lapse and each Placee's rights and
obligations in respect of the Placing will cease and terminate at
such time.
Each of Zeus Capital's and finnCap's obligations under the
Placing Agreement may be terminated by Zeus Capital and finnCap at
any time prior to Admission in certain circumstances including,
among other things, following a material breach of the Placing
Agreement by the Company and/or the occurrence of certain force
majeure events. The exercise of any right of termination pursuant
to the Placing Agreement, any waiver of any condition in the
Placing Agreement and any decision by Zeus Capital and finnCap
whether or not to extend the time for satisfaction of any condition
in the Placing Agreement will be within Zeus Capital's and
finnCap's absolute discretion (as is the exercise of any right or
power of Zeus Capital and finnCap that is referred to in this
Appendix). Neither Zeus Capital nor finnCap will have any liability
to any Placee or to anyone else in respect of any such termination,
waiver or extension or any decision to exercise or not to exercise
any such right of termination, waiver or extension in respect of
the Placing Agreement.
6. Placees' warranties and undertakings to the Company, Zeus Capital and finnCap
By agreeing with finnCap as agent of the Company to subscribe
for Placing Shares under the Placing, a Placee (and any person
acting on a Placee's behalf) will irrevocably acknowledge and
confirm and warrant and undertake to, and agree with, each of the
Company and Zeus Capital and finnCap, in each case as a fundamental
term of such Placee's application for Placing Shares and of the
Company's obligation to allot and/or issue any Placing Shares to it
or at its direction, that:
(a) it agrees to and accepts all the terms set out in this Appendix;
(b) its rights and obligations in respect of the Placing will
terminate only in the circumstances referred to in this Appendix
and will not be subject to rescission or termination by it in any
circumstances;
(c) this document, which has been issued by the Company, is
within the sole responsibility of the Company;
(d) it has not been, and will not be, given any warranty or
representation in relation to the Placing Shares or to the Company
or to any other member of its Group in connection with the Placing,
other than (i) by the Company as included in this document, and
(ii) by the Company to the effect that at the time that the Placee
enters into a legally binding commitment to subscribe for Placing
Shares pursuant to the Placing the Company will not then be in
breach of its obligations under the London Stock's Exchange's AIM
Rules for Companies or under the EU Market Abuse Regulation
(596/2014) to disclose publicly in the correct manner all such
information as is then required to be so disclosed by the
Company;
(e) it has not relied on any representation or warranty in
reaching its decision to subscribe for Placing Shares under the
Placing, save as given or made by the Company as referred to in the
previous paragraph;
(f) it is not a client of Zeus Capital or finnCap in relation to
the Placing and neither Zeus Capital nor finnCap is acting for it
in connection with the Placing and will not be responsible to it in
respect of the Placing for providing protections afforded to its
respective clients;
(g) it has not been, and will not be, given any warranty or
representation by any Broker Person in relation to any Placing
Shares, the Company or any other member of its Group and no Broker
Person will have any liability to it for any information contained
in this document or which has otherwise been published by the
Company or for any decision by it to participate in the Placing
based on any such information or on any other information provided
to it;
(h) it will pay the full subscription sum at the Placing Price
as and when required in respect of all Placing Shares for which it
is required to subscribe under its Placing participation and will
do all things necessary on its part to ensure that payment for such
shares and their delivery to it or at its direction is completed in
accordance with the standing CREST instructions (or, where
applicable, standing certificated settlement instructions) that it
has in place with finnCap or puts in place with finnCap;
(i) it is permitted to subscribe for Placing Shares under the
laws of all relevant jurisdictions which apply to it and it has
complied, and will fully comply, with all such laws (including
where applicable, the Anti-Terrorism, Crime and Security Act 2001,
the Proceeds of Crime Act 2002 and the Money Laundering Regulations
2007) and has obtained all governmental and other consents (if any)
which may be required for the purpose of, or as a consequence of,
such subscription, and it will provide promptly to finnCap such
evidence, if any, as to the identity or location or legal status of
any person which finnCap may request from it in connection with the
Placing (for the purpose of complying with any such laws or
ascertaining the nationality of any person or the jurisdiction(s)
to which any person is subject or otherwise) in the form and manner
requested by finnCap on the basis that any failure by it to do so
may result in the number of Placing Shares that are to be allotted
and/or issued to it or at its direction pursuant to the Placing
being reduced to such number, or to nil, as Zeus Capital and
finnCap may decide;
(j) it has complied and will comply with all applicable
provisions of the FSMA with respect to anything done or to be done
by it in relation to any Placing Shares in, from or otherwise
involving the United Kingdom and it has not made or communicated or
caused to be made or communicated, and it will not make or
communicate or cause to be made or communicated, any "financial
promotion" in relation to Placing Shares in contravention of
section 21 of FSMA;
(k) it is a FSMA Qualified Investor;
(l) 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, (ii) it is and will remain liable to the Company and/or
finnCap 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) it is both an "authorised person" for
the purposes of FSMA and a "qualified investor" as defined at
Article 2.1(e)(i) of Directive 2003/71/EC (known as the Prospectus
Directive) acting as agent for such person, and (iv) such person is
either (1) a FSMA Qualified Investor or (2) its "client" (as
defined in section 86(2) of FSMA) that has engaged it to act as his
agent on terms which enable it to make decisions concerning the
Placing or any other offers of transferable securities on his
behalf without reference to him;
(m) nothing has been done or will be done by it in relation to
the Placing or to any Placing Shares that has resulted or will
result in any person being required to publish a prospectus in
relation to the Company or to any Ordinary Shares in accordance
with FSMA or the Prospectus Rules or in accordance with any other
laws applicable in any part of the European Union or the European
Economic Area;
(n) it will not treat any Placing Shares in any manner that
would contravene any legislation applicable in any territory or
jurisdiction and no aspect of its participation in the Placing will
contravene any legislation applicable in any territory or
jurisdiction in any respect or cause the Company and/or Zeus
Capital and/or finnCap to contravene any such legislation in any
respect;
(o) (in this paragraph "US person" and other applicable terms
have the meanings that they have in Regulation S made under the US
Securities Act of 1933, as amended) (i) none of the Placing Shares
have been or will be registered under that Act or under the
securities laws of any State of or other jurisdiction within the
United States, (ii) subject to certain exceptions, Placing Shares
may not be offered or sold, resold, or delivered, directly or
indirectly, into or within the United States or to, or for the
account or benefit of, any US person, (iii) it is (unless otherwise
expressly agreed with Zeus Capital and finnCap) neither within the
United States nor a US person, (iv) it has not offered, sold or
delivered and will not offer sell or deliver any of the Placing
Shares to persons within the United States, directly or indirectly,
(v) neither it, its affiliates, nor any persons acting on its
behalf, has engaged or will engage in any directed selling efforts
with respect to the Placing Shares, (vi) it will not be subscribing
Placing Shares with a view to resale in or into the United States,
and (vii) it will not distribute this document or any offering
material relating to Placing Shares, directly or indirectly, in or
into the United States or to any persons resident in the United
States;
(p) Zeus Capital and/or finnCap may itself agree to become a
Placee in respect of some or all of the Placing Shares or by
nominating any other relevant Broker Person or any person
associated with any Broker Person to do so;
(q) time is of essence as regards its obligations under this Appendix;
(r) this Appendix and any contract which may be entered into
between it and finnCap and/or the Company pursuant to this Appendix
or the Placing, and all non-contractual obligations arising between
the Placee and Zeus Capital and/or finnCap and/or the Company in
respect of the Placing, will be governed by and construed in
accordance with the laws of England, for which purpose it submits
(for itself and on behalf of any person on whose behalf it is
acting) to the exclusive jurisdiction of the English courts as
regards any claim, dispute, or matter arising out of or relating to
this Appendix or such contract, except that each of the Company and
finnCap will have the right to bring enforcement proceedings in
respect of any judgment obtained against such Placee in the English
courts or in the courts of any other relevant jurisdiction;
(s) each right or remedy of the Company or finnCap provided for
in this Appendix is in addition to any other right or remedy which
is available to such person and the exercise of any such right or
remedy in whole or in part will not preclude the subsequent
exercise of any such right or remedy;
(t) any document that is to be sent to it in connection with the
Placing will be sent at its risk and may be sent to it at any
address provided by it to finnCap;
(u) nothing in this Appendix will exclude any liability of any
person for fraud on its part, and all times and dates in this
document are subject to amendment at the discretion of Zeus Capital
and finnCap except that in no circumstances will the date scheduled
for Admission be later than the Long Stop Date; and
(v) none of its rights or obligations in respect of the Placing
is conditional on any other person agreeing to subscribe for any
Placing Shares under the Placing and no failure by any other Placee
to meet any of its obligations in respect of the Placing will
affect any of its obligations in respect of the Placing.
7. Payment default
A Placee's entitlement to receive any Placing Shares under the
Placing will be conditional on finnCap's receipt of payment in full
for such shares by the relevant time to be stated in the written
confirmation referred to above, or by such later time and date as
finnCap may determine, and otherwise in accordance with that
confirmation's terms. finnCap may waive this condition, and will
not be liable to any Placee for any decision to waive it or
not.
If any Placee fails to make such payment by the required time
for any Placing Shares (1) the Company may release itself, and (if
it decides to do so) will be released from, all obligations it may
have to allot and/or issue any such Placing Shares to such Placee
or at its direction which are then unallotted and/or unissued, (2)
the Company may exercise all rights of lien, forfeiture and set-off
over and in respect of any such Placing Shares to the full extent
permitted under its constitution or by law and to the extent that
such Placee then has any interest in or rights in respect of any
such shares, (3) the Company or, as applicable, finnCap may sell
(and each of them is irrevocably authorised by such Placee to do
so) all or any of such shares on such Placee's behalf and then
retain from the proceeds, for the account and benefit of the
Company or, where applicable, finnCap (i) any amount up to the
total amount due to it as, or in respect of, subscription monies,
or as interest on such monies, for any Placing Shares and (ii) any
amount required to cover dealing costs and/or commissions
necessarily or reasonably incurred by it in respect of such sale,
and (4) such Placee will remain liable to the Company and to
finnCap for the full amount of any losses and of any costs which it
may suffer or incur as a result of it (i) not receiving payment in
full for such Placing Shares by the required time, and/or (ii) the
sale of any such Placing Shares to any other person at whatever
price and on whatever terms are actually obtained for such sale by
or for it. Interest may be charged in respect of payments not
received by finnCap for value by the required time referred to
above at the rate of two percentage points above the base rate of
Barclays plc.
8. Overseas jurisdictions
The distribution of this document and the offering and/or issue
of shares pursuant to the Placing in certain jurisdictions is
restricted by law. Persons who seek to participate in the Placing
must inform themselves about and observe any such restrictions. In
particular, this document does not constitute or form part of any
offer or invitation, or a solicitation of any offer or invitation,
to subscribe for or acquire or sell or purchase or otherwise deal
in Ordinary Shares in the United States, Canada, Japan or Australia
or in any other jurisdiction in which any such offer, invitation or
solicitation is or would be unlawful. The Placing Shares have not
been and will not be registered under the US Securities Act of
1933, as amended or under the securities laws of any State of or
other jurisdiction within the United States, and, subject to
certain exceptions, may not be offered or sold, resold or
delivered, directly or indirectly, in or into the United States, or
to, or for the account or benefit of, any US persons (as defined in
Regulation S under that Act). No public offering of the Placing
Shares is being or will be made in the United States.
9. Placing Shares
The Placing Shares will, when issued, be credited as fully paid
and will rank pari passu in all respects with the existing issued
Ordinary Shares.
DEFINITIONS
In this Appendix to the Announcement and, as the context shall
admit, in the Announcement:
Admission admission of the Placing
Shares to trading on
AIM and such admission
becoming effective in
accordance with the AIM
Rules;
AIM the AIM market operated
by the London Stock Exchange;
AIM Rules the AIM Rules for Companies
and/or the AIM Rules
for Nominated Advisers
(as the context may require);
AIM Rules for Companies the rules of AIM as set
out in the publication
entitled 'AIM Rules for
Companies' published
by the London Stock Exchange
from time to time;
AIM Rules for Nominated the rules of AIM as set
Advisers out in the publication
entitled 'AIM Rules for
Nominated Advisers' published
by the London Stock Exchange
from time to time;
Board or Directors the board of directors
of the Company for the
time being;
Broker Person any person being (i)
the Brokers, (ii) an
undertaking which is
a subsidiary undertaking
of either of the Brokers,
(iii) a parent undertaking
of either of the Brokers
or a subsidiary undertaking
of any such parent undertaking,
or (iv) a director, officer,
agent or employee of
any such person;
Brokers finnCap and Zeus Capital
or either one of them
as the context may require;
Business Day any day (excluding Saturdays
and Sundays) on which
banks are open in London
for normal banking business
and the London Stock
Exchange is open for
trading;
Capita Asset Services a trading name of Capita
Registrars Limited, a
company incorporated
in England and Wales
with registered number
02605568 and having its
registered office at
The Registry, Beckenham,
Kent BR3 4TU;
certificated or in certificated the description of a
form share or other security
which is not in uncertificated
form (that is not in
CREST);
Circular means the circular to
be issued by the Company
to the holders of Ordinary
Shares containing, inter
alia, details of the
Placing and the Notice
of General Meeting;
Closing Price the closing middle market
quotation of an Ordinary
Share as derived from
the AIM Appendix to the
Daily Official List of
the London Stock Exchange;
Company or Flowtech Flowtech Fluidpower plc,
a company incorporated
in England and Wales
with registered number
09010518 and having its
registered office at
Pimbo Road, Skelmersdale,
WN8 9RB
CREST the relevant system (as
defined in the CREST
Regulations) in respect
of which Euroclear is
the Operator (as defined
in the CREST Regulations);
Enlarged Share Capital the issued share capital
of the Company immediately
following Admission;
EU the European Union;
Euroclear Euroclear UK & Ireland
Limited;
Existing Issued Share the issued share capital
Capital of the Company as at
the Latest Practicable
Date;
Existing Ordinary Shares the 43,078,282 Ordinary
Shares in issue as at
the Record Date;
FCA the UK Financial Conduct
Authority;
finnCap or finnCap Ltd finnCap Ltd, a company
incorporated in England
and Wales with registered
company number 06198898,
authorised and regulated
by the FCA;
Form of Proxy the form of proxy accompanying
this document relating
to the General Meeting;
FSMA the UK Financial Services
and Markets Act 2000,
as amended;
General Meeting or GM the general meeting of
the Company, notice of
which is set out at the
end of this document,
and including any adjournment(s)
thereof;
Group or Flowtech the Company and/or its
subsidiary undertakings
at the date of this document
(as defined in sections
1159 and 1160 of the
Act);
Impact Announcement the Company's proposed
regulatory announcement
of the Placing;
Issue Price or Placing 120 pence per Placing
Price Share;
Latest Practicable Date means 5:00 p.m. on 8
March 2017, being the
latest practicable date
prior to the announcement
by the Company of its
intention to undertake
the Placing;
London Stock Exchange London Stock Exchange
plc;
Notice of General Meeting means the notice convening
the General Meeting which
will be set out at the
end of the Circular;
Options options granted by the
Company over unissued
Ordinary Shares pursuant
to employee share option
schemes and rights to
subscribe for shares
pursuant to employee
and non executive long
term incentive plans
put in place by the Company;
Option Holders the employees of the
Company (including Directors)
who hold Options;
Ordinary Shares ordinary shares of 50
pence each in the capital
of the Company;
Placees the persons who have
agreed to subscribe for
the Placing Shares;
Placing the placing of the Placing
Shares with the Placees
pursuant to the Placing
Agreement;
Placing Agreement the conditional agreement
dated 9 March 2017 between
the Company, Zeus Capital
Limited and finnCap Limited
relating to the Placing;
Placing Shares the 8,333,333 new Ordinary
Shares to be issued by
the Company under the
Placing;
Prospectus Rules the Prospectus Rules
published by the FCA;
Record Date 5:00 p.m. on 8 March
2017;
Registrars Capita Asset Services,
a trading name of Capita
Registrars Limited;
Regulatory Information has the meaning given
Service or in the AIM Rules for
RNS Companies;
Resolutions the resolutions to be
proposed at the General
Meeting which are set
out in full in the Notice
of General Meeting;
Shareholders holders of Existing Ordinary
Shares;
uncertificated recorded on a register
of securities maintained
by Euroclear in accordance
with the CREST Regulations
as being in uncertificated
form in CREST and title
to which, by virtue of
the CREST Regulations,
may be transferred by
means of CREST;
UK or United Kingdom the United Kingdom of
England, Scotland, Wales
and Northern Ireland;
Zeus Capital or Zeus Zeus Capital Limited,
Capital Limited a company incorporated
in England and Wales
with registered company
number 04417845;
GBP or sterling pounds sterling, the
legal currency of the
United Kingdom; and
terms defined elsewhere in this document have
the same meanings, unless the context requires
otherwise.
This information is provided by RNS
The company news service from the London Stock Exchange
END
MSCEAKDNESNXEFF
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March 09, 2017 12:03 ET (17:03 GMT)
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