NOT FOR
RELEASE, PUBLICATION OR DISTRIBUTION, IN WHOLE OR IN PART, DIRECTLY
OR INDIRECTLY, IN OR INTO THE UNITED STATES, AUSTRALIA, CANADA,
JAPAN OR SOUTH AFRICA OR ANY OTHER JURISDICTION WHERE SUCH RELEASE,
PUBLICATION OR DISTRIBUTION WOULD BE UNLAWFUL. FURTHER, THIS
ANNOUNCEMENT IS FOR INFORMATION PURPOSES ONLY AND IS NOT AN OFFER
OF SECURITIES IN ANY JURISDICTION.
THIS
ANNOUNCEMENT CONTAINS INSIDE INFORMATION FOR THE PURPOSES OF
ARTICLE 7 OF REGULATION (EU) 596/2014 AS IT FORMS PART OF UK
DOMESTIC LAW BY VIRTUE OF THE EUROPEAN UNION (WITHDRAWAL) ACT
2018.
4 March 2024
LungLife AI, Inc.
(the "Company" or
"LungLife")
Proposed equity raise of approximately
£1.8 million to fund
commercial proof of
concept
LungLife AI (AIM: LLAI), a developer
of clinical diagnostic solutions for the early detection of lung
cancer, today announces that it proposes to raise approximately
£1.8 million (approximately US$2.3 million) (before fees and
expenses) (the "Fundraising"). The Fundraising will
comprise the issue of new common stock of the Company with a par
value of US$0.0001 per share ("New
Shares") through:
·
a non-pre-emptive conditional placing of New
Shares (the "Placing
Shares") at the Issue Price (as defined below) to raise
approximately £1.56 million (approximately US$1.96 million) (before
fees and expenses) (the "Placing"); and
·
conditional subscriptions for New Shares (the
"Subscription Shares")
expected from certain existing shareholders at the Issue Price to
raise approximately £0.25 million (approximately US$0.32 million)
(before fees and expenses) (the "Subscription").
Operational Highlights
·
LungLife is a developer of clinical diagnostic
solutions for lung cancer enhanced by AI. The Company's diagnostic
solutions are designed to make significant improvements in the
early detection of lung cancer, one of the most lethal cancers,
accounting for nearly a quarter of all cancer-related deaths in the
US.
·
On 2 January 2024, LungLife reported positive
validation study results for its LungLB® test, a minimally invasive
blood draw test used for the early detection of lung
cancer.
·
These results are the catalyst for the Company to
begin its commercialisation process for the test.
·
The net proceeds of the Fundraising, along with
the Company's existing cash resources, are expected to be utilised
to establish the commercial proof of concept of the Company's
LungLB® test, including:
·
funding of evidence generating activities,
including the Early Access Program ("EAP") and clinical utility studies,
dependent upon the factors noted in Section 2 of Appendix 1 below,
to support reimbursement and test adoption;
·
increasing expenditure to support engagement with
payors and clinicians, and support the wider need to raise clinical
awareness via key opinion leaders, publications and conferences;
and
·
accelerating the commercial pathway by pursuing
licensing or other similar agreements.
The net proceeds of the Fundraising
will allow the Company to consider all of its strategic options in
order to maximise shareholder value and, in conjunction with the
implementation of certain cost-cutting actions, is expected to
provide the Company with a cash runway to early April
2025.
Fundraising Highlights
·
New Shares to be issued at a price of 35 pence per
share (the "Issue Price"),
which represents a discount of approximately 15.7 per cent. to the
closing price of 41.5 pence per Common Share on 4 March 2024 (being
the last practicable date prior to publication of this
announcement).
·
Placing Shares will comprise (i) New Shares to be
issued to VCT and EIS investors (the "VCT/EIS Placing Shares"); and (ii) New
Shares to be issued to non-VCT and EIS investors.
·
Roy Davis, Paul Pagano, David Anderson and Andrew
Boteler have each confirmed their intention to participate in the
Fundraising for an aggregate amount of £25,000 (approximately
US$31,500).
Details of the Fundraising
Investec Bank plc ("Investec") and Goodbody Stockbrokers
UC, trading as Goodbody ("Goodbody" and, together with Investec,
the "Joint Bookrunners"),
are acting as joint bookrunners in connection with the
Placing.
The Placing is subject to the terms
and conditions set out in Appendix 2 to this announcement (which
forms part of this announcement, such announcement and the
Appendices together being the "Announcement"). Members of the public
are not entitled to participate in the Placing. The Subscription
will be subject to the terms and conditions set out in subscription
agreements expected to be entered into between the subscribers and
the Company rather than pursuant to the terms and conditions of the
Placing contained in Appendix 2 to this Announcement.
The Placing will be conducted
through an accelerated bookbuilding process (the "Bookbuild") which will be launched
immediately following this Announcement. The number of Placing
Shares will be decided at the close of the Bookbuild. The timing of
the closing of the book and allocations are at the discretion of
the Joint Bookrunners and the Company. Details of the number of
Placing Shares and Subscription Shares will be announced as soon as
practicable after the close of the Bookbuild.
The New Shares will, when issued, be
credited as fully paid and will rank pari passu in all respects with the
existing Common Shares, including the right to receive all
dividends and other distributions declared, made or paid in respect
of the New Shares after the date of issue.
The New Shares will be issued under
temporary ISIN: USU5500L1128 and
TIDM: LLA (with the marker REGS Cat 3) and will be subject to
restrictions on re-sales until the expiry of one year after the
later of (i) the time when the New Shares are first offered to
persons other than distributors in reliance upon Regulation S; and
(ii) the date of closing of the Fundraising, or such longer period
as the Company may determine it as may be required under applicable
law following which the ISIN may be merged with the ISIN for the
Company's existing shares. Further details of these restrictions
are set out under "US restrictions on the transfer of Common
Shares" in Appendix 2 to this Announcement.
An application will be made to
London Stock Exchange plc (the "London Stock Exchange") for admission
of the New Shares to trading on AIM ("Admission"). It is expected that
Admission will become effective at 8.00 a.m. on 22 March
2024.
The Placing is conditional, among
other things, on (i) shareholder approval; (ii) Admission becoming
effective; and (iii) the placing agreement between the Company and
the Joint Bookrunners (the "Placing Agreement") not being
terminated in accordance with its terms. Pursuant to the Placing
Agreement, the Joint Bookrunners expect to receive their
professional fees in relation to the Placing in the form of New
Shares in the Company at the Issue Price.
Appendix 2 to this Announcement sets
out further information relating to the Bookbuild and the terms and
conditions of the Placing. The Subscription is conditional, among
other things, on (i) shareholder approval; and (ii) Admission
becoming effective.
A circular containing the notice of
the Special Meeting to be held on 21 March 2024 to, inter alia, approve the resolutions
required to implement the Fundraising, is expected to be published
and despatched to shareholders on or around 6 March 2024 (the
"Circular"). Appendix 1 to
this Announcement is an adapted extract from the Circular that is
proposed to be sent to shareholders. Following its publication the
Circular will be available on the Company's website at https://lunglifeai.com/investors/shareholder-information/
Certain defined terms used herein
are set out in Appendix 3 to this Announcement.
This Announcement should be read in
its entirety. In particular, you should read and understand the
information provided in the 'Important Notices" section of this
Announcement and set out in Appendix 2 to this
Announcement
For further
information please contact:
LungLife AI,
Inc.
|
www.lunglifeai.com
|
Paul Pagano, CEO
|
Via Walbrook PR
|
David Anderson, CFO
|
|
|
|
Investec Bank plc (Nominated Adviser & Joint
Broker)
|
Tel: +44 (0)20 7597
5970
|
Virginia Bull / Cameron MacRitchie / Lydia
Zychowska
|
|
|
|
Goodbody Stockbrokers UC (Joint Broker)
Tom Nicholson / Cameron Duncan /
William Hall
|
Tel: +44 (0)20 3841
6202
|
Walbrook PR Limited
|
Tel: +44 (0)20 7933
8780
|
Paul McManus / Alice Woodings /
Phillip Marriage
|
or LungLifeAI@walbrookpr.com
|
About LungLife
LungLife AI is a developer of
clinical diagnostic solutions designed to make a significant impact
in the early detection of lung cancer, the deadliest cancer
globally. Using a minimally invasive blood draw, the
Company's LungLB® test is designed to deliver additional
information to clinicians who are evaluating indeterminate lung
nodules. For more information visit
www.lunglifeai.com
IMPORTANT
NOTICES
THIS ANNOUNCEMENT, INCLUDING THE
APPENDICES AND THE INFORMATION CONTAINED IN THEM, IS RESTRICTED AND
IS NOT FOR PUBLICATION, RELEASE, TRANSMISSION, FORWARDING OR
DISTRIBUTION, DIRECTLY OR INDIRECTLY, IN WHOLE OR IN PART, IN OR
INTO THE UNITED STATES OF AMERICA, ITS TERRITORIES AND POSSESSIONS,
ANY STATE OF THE UNITED STATES OR THE DISTRICT OF COLUMBIA
(COLLECTIVELY, THE "UNITED
STATES"), AUSTRALIA, CANADA, JAPAN OR SOUTH AFRICA OR ANY
OTHER JURISDICTION IN WHICH SUCH PUBLICATION, RELEASE OR
DISTRIBUTION WOULD BE UNLAWFUL. FURTHER, THIS ANNOUNCEMENT IS FOR
INFORMATION PURPOSES ONLY AND IS NOT AN OFFER OF SECURITIES IN ANY
JURISDICTION.
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, Canada, Australia, Japan or
South Africa 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.
No action has been taken by the
Company, the Joint Bookrunners (as defined below) or any of their
respective affiliates, or any person acting on its or their behalf
that would permit an offer of the Placing Shares or possession or
distribution of this Announcement or any other offering or
publicity material relating to such Placing Shares in any
jurisdiction where action for that purpose is required. Persons
into whose possession this Announcement comes are required by the
Company and the Joint Bookrunners to inform themselves about, and
to observe, such restrictions.
No prospectus, offering memorandum,
offering document or admission document has been or will be made
available in connection with the matters contained in this
Announcement and no such prospectus is required (in accordance with
Regulation (EU) No 2017/1129 (as amended) (the "EU Prospectus Regulation") or the EU
Prospectus Regulation as it forms part of UK domestic law by virtue
of the European Union (Withdrawal) Act 2018 (the "UK Prospectus Regulation")) to be
published. Persons needing advice should consult a qualified
independent legal adviser, business adviser, financial adviser or
tax adviser for legal, financial, business or tax
advice.
The securities referred to herein
have not been and will not be registered under the US Securities
Act of 1933, as amended (the "Securities Act"), or with any
securities regulatory authority of any State or other jurisdiction
of the United States, and may not be offered, sold or transferred,
directly or indirectly, in or into the United States, or to or for
the account or benefit of US persons (as defined in Regulation S
under the Securities Act ("Regulation S")), except pursuant to an
exemption from, or in a transaction not subject to, the
registration requirements of the Securities Act and in compliance
with the securities laws of any State or any other jurisdiction of
the United States. Accordingly, the Placing Shares will be offered
and sold only outside of the United States to non-US persons in
"offshore transactions" within the meaning of, and pursuant to,
Regulation S and otherwise in accordance with applicable laws. No
public offering of the Securities will be made in the United States
or elsewhere.
This Announcement has not been
approved by the London Stock Exchange.
Members of the public are not
eligible to take part in the Placing. This Announcement is directed
at and is only being distributed to: (a) if in a member state of
the European Economic Area (the "EEA"), qualified investors
("Qualified Investors")
within the meaning of Article 2(e) of the EU Prospectus Regulation;
(b) if in the United Kingdom, qualified investors within the
meaning of Article 2(e) of the UK Prospectus Regulation who are
also (i) persons having professional experience in matters relating
to investments who fall within the definition of "investment
professional" in Article 19(5) of the Financial Services and
Markets Act 2000 (Financial Promotion) Order 2005, as amended (the
"Order"); or (ii) high net
worth companies, unincorporated associations and partnerships and
trustees of high value trusts as described in Article 49(2)(a) to
(d) of the Order ("UK Qualified
Investors"); or (c) other persons to whom it may otherwise
be lawfully communicated (all such persons together being
"Relevant
Persons").
This Announcement must not be acted
on or relied on by persons who are not Relevant Persons. Persons
distributing this Announcement must satisfy themselves that it is
lawful to do so. Any investment or investment activity to which
this Announcement relates is available only to Relevant Persons and
will be engaged in only with Relevant Persons.
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 South Africa in
relation to the Placing Shares and the Placing Shares have not
been, nor will they be, registered under or offered in compliance
with the securities laws of any state, province or territory of
Australia, Canada, Japan or 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 or South Africa
or any other jurisdiction in which such activities would be
unlawful.
By participating in the Bookbuild
and the Placing, each person who is invited to and who chooses to
participate in the Placing (each a "Placee") by making an oral or written
and legally binding offer to acquire Placing Shares will be deemed
to have read and understood this Announcement in its entirety, to
be participating, making an offer and acquiring Placing Shares on
the terms and conditions contained in Appendix 2 to this
Announcement and to be providing the representations, warranties,
indemnities, acknowledgements and undertakings contained in
Appendix 2 to this Announcement.
Certain statements contained in this
Announcement constitute "forward-looking statements" with respect
to the financial condition, results of operations and businesses
and plans of the Company and its subsidiaries (the "Group"). Words such as "believes",
"anticipates", "estimates", "expects", "intends", "plans", "aims",
"potential", "will", "would", "could", "considered", "likely",
"estimate" and variations of these words and similar future or
conditional expressions, are intended to identify forward-looking
statements but are not the exclusive means of identifying such
statements. These statements and forecasts involve risk and
uncertainty because they relate to events and depend upon future
circumstances that have not occurred. There are a number of factors
that could cause actual results or developments to differ
materially from those expressed or implied by these forward-looking
statements and forecasts. As a result, the Group's actual financial
condition, results of operations and business and plans may differ
materially from the plans, goals and expectations expressed or
implied by these forward-looking statements. No representation or
warranty is made as to the achievement or reasonableness of, and no
reliance should be placed on, such forward-looking statements. No
statement in this Announcement is intended to be, nor may be
construed as, a profit forecast or be relied upon as a guide to
future performance. The forward-looking statements contained in
this Announcement speak only as of the date of this Announcement.
The Company, its directors, the Joint Bookrunners, their respective
affiliates and any person acting on its or their behalf each
expressly disclaim any obligation or undertaking to update or
revise publicly any forward-looking statements, whether as a result
of new information, future events or otherwise, unless required to
do so by applicable law or regulation or the London Stock
Exchange.
Investec Bank plc ("IBP") is authorised by the Prudential
Regulation Authority (the "PRA") and regulated in the United
Kingdom by the PRA and the FCA. Investec Europe Limited (trading as
Investec Europe) ("IEL"),
acting as agent on behalf of IBP in certain jurisdictions in the
EEA (IBP and IEL together, "Investec"), is regulated in Ireland by
the Central Bank of Ireland. Goodbody Stockbrokers UC, trading as
Goodbody ("Goodbody", and
together with Investec, the "Joint
Bookrunners"), is authorised and regulated in Ireland by the
Central Bank of Ireland and is authorised and regulated in the
United Kingdom by the FCA. The Joint Bookrunners are acting
exclusively for the Company and no one else in connection with the
Placing, the contents of this Announcement or any other matters
described in this Announcement. Neither Joint Bookrunner will
regard any other person as its client in relation to the Placing,
the content of this Announcement or any other matters described in
this Announcement and will not be responsible to anyone (including
any Placees) other than the Company for providing the protections
afforded to its clients or for providing advice to any other person
in relation to the Placing, the content of this Announcement or any
other matters referred to in this Announcement.
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 either Joint Bookrunner or by any of its affiliates or
any person acting on its or their behalf as to, or in relation to,
the accuracy or completeness of this Announcement or any other
written or oral information made available to or publicly available
to any interested party or its advisers, and any liability
therefore is expressly disclaimed.
This Announcement does not
constitute a recommendation concerning any investor's investment
decision with respect to the Placing. Any indication in this
Announcement of the price at which ordinary shares have been bought
or sold in the past cannot be relied upon as a guide to future
performance. The price of shares and any income expected from them
may go down as well as up and investors may not get back the full
amount invested upon disposal of the shares. Past performance is no
guide to future performance. This Announcement does not identify or
suggest, or purport to identify or suggest, the risks (direct or
indirect) that may be associated with an investment in the Placing
Shares. The contents of this Announcement are not to be construed
as legal, business, financial or tax advice. Each investor or
prospective investor should consult their or its own legal adviser,
business adviser, financial adviser or tax adviser for legal,
financial, business or tax advice.
No statement in this Announcement is
intended to be a profit forecast or profit estimate for any period,
and no statement in this Announcement should be interpreted to mean
that earnings, earnings per share or income, cash flow from
operations or free cash flow for the Company for the current or
future financial years would necessarily match or exceed the
historical published earnings, earnings per share or income, cash
flow from operations or free cash flow for the Company.
All offers of the Placing Shares
will be made pursuant to an exemption under the UK Prospectus
Regulation or the EU Prospectus Regulation from the requirement to
produce a prospectus. This Announcement is being distributed and
communicated to persons in the UK only in circumstances to which
section 21(1) of the Financial Services and Markets Act, 2000, as
amended does not apply.
The Placing Shares to be issued or
sold pursuant to the Placing will not be admitted to trading on any
stock exchange other than the London Stock Exchange.
Persons (including, without
limitation, nominees and trustees) who have a contractual or other
legal obligation to forward a copy of this Announcement should seek
appropriate advice before taking any action.
Neither the content of the Company's
website (or any other website) nor the content of any website
accessible from hyperlinks on the Company's website (or any other
website) is incorporated into or forms part of this
Announcement.
This Announcement has been prepared
for the purposes of complying with applicable law and regulation in
the United Kingdom and the information disclosed may not be the
same as that which would have been disclosed if this Announcement
had been prepared in accordance with the laws and regulations of
any jurisdiction outside the United Kingdom.
Inside Information
This announcement contains inside
information as defined in Regulation (EU) No. 596/2014 on market
abuse which is part of UK domestic law by virtue of
the European Union (Withdrawal) Act 2018 ("MAR") and is
made in accordance with the Company's obligations under article 17
of MAR. The person responsible for arranging the release of this
announcement on behalf of LungLife is David Anderson, Company
Secretary of LungLife.
UK
Product Governance Requirements
Solely for the purposes of the
product governance requirements of Chapter 3 of the FCA Handbook
Product Intervention and Product Governance Sourcebook (the
"UK Product Governance
Requirements"), and disclaiming all and any liability,
whether arising in tort, contract or otherwise, which any
"manufacturer" (for the purposes of the UK Product Governance
Requirements) may otherwise have with respect thereto, the Placing
Shares have been subject to a product approval process, which has
determined that such Placing Shares are: (i) compatible with an end
target market of retail investors and investors who meet the
criteria of professional clients and eligible counterparties, each
as defined in the FCA Handbook Conduct of Business Sourcebook; and
(ii) eligible for distribution through all permitted distribution
channels (the "Target Market
Assessment"). Notwithstanding the Target Market Assessment,
distributors should note that: the price of the Placing Shares may
decline and investors could lose all or part of their investment;
the Placing Shares offer no guaranteed income and no capital
protection; and an investment in the Placing Shares is compatible
only with investors who do not need a guaranteed income or capital
protection, who (either alone or in conjunction with an appropriate
financial or other adviser) are capable of evaluating the merits
and risks of such an investment and who have sufficient resources
to be able to bear any losses that may result therefrom. The Target
Market Assessment is without prejudice to the requirements of any
contractual, legal or regulatory selling restrictions in relation
to the Placing. Furthermore, it is noted that, notwithstanding the
Target Market Assessment, the Joint Bookrunners will only procure
investors who meet the criteria of professional clients and
eligible counterparties.
For the avoidance of doubt, the
Target Market Assessment does not constitute: (a) an assessment of
suitability or appropriateness for the purposes of Chapters 9A or
10A, respectively, of the FCA Handbook Conduct of Business
Sourcebook; or (b) a recommendation to any investor or group of
investors to invest in, or purchase or take any other action
whatsoever with respect to the Placing Shares. Each distributor is
responsible for undertaking its own target market assessment in
respect of the Placing Shares and determining appropriate
distribution channels.
EU
Product Governance Requirements
Solely for the purposes of the
product governance requirements contained within: (a) EU Directive
2014/65/EU on markets in financial instruments, as amended
("MiFID II"); (b) Articles
9 and 10 of Commission Delegated Directive (EU) 2017/593
supplementing MiFID II; and (c) local implementing measures
(together, the "MiFID II Product
Governance Requirements") and/or any equivalent requirements
elsewhere to the extent determined to be applicable, and
disclaiming all and any liability, whether arising in tort,
contract or otherwise, which any "manufacturer" (for the purposes
of the MiFID II Product Governance Requirements and/or any
equivalent requirements elsewhere to the extent determined to be
applicable) may otherwise have with respect thereto, the Placing
Shares have been subject to a product approval process, which has
determined that the Placing Shares are: (i) compatible with an end
target market of retail investors and investors who meet the
criteria of professional clients and eligible counterparties, each
as defined in MiFID II; and (ii) eligible for distribution through
all distribution channels as are permitted by MiFID II (the
"EU Target Market
Assessment"). Notwithstanding the EU Target Market
Assessment, distributors should note that: the price of the Placing
Shares may decline and investors could lose all or part of their
investment; the Placing Shares offer no guaranteed income and no
capital protection; and an investment in the Placing Shares is
compatible only with investors who do not need a guaranteed income
or capital protection, who (either alone or in conjunction with an
appropriate financial or other adviser) are capable of evaluating
the merits and risks of such an investment and who have sufficient
resources to be able to bear any losses that may result therefrom.
The EU Target Market Assessment is without prejudice to the
requirements of any contractual, legal or regulatory selling
restrictions in relation to the Placing. Furthermore, it is noted
that, notwithstanding the EU Target Market Assessment, the Joint
Bookrunners will only procure investors who meet the criteria of
professional clients and eligible counterparties.
For the avoidance of doubt, the EU
Target Market Assessment does not constitute: (a) an assessment of
suitability or appropriateness for the purposes of MiFID II; or (b)
a recommendation to any investor or group of investors to invest
in, or purchase, or take any other action whatsoever with respect
to the Placing Shares. Each distributor is responsible for
undertaking its own target market assessment in respect of the
Placing Shares and determining appropriate distribution
channels.
NOTWITHSTANDING ANYTHING IN THE
FOREGOING, NO PUBLIC OFFERING OF THE PLACING SHARES IS BEING MADE
BY ANY PERSON ANYWHERE AND THE COMPANY HAS NOT AUTHORISED OR
CONSENTED TO ANY SUCH OFFERING IN RELATION TO THE PLACING
SHARES.
APPENDIX
1 - ADAPTED EXTRACT FROM THE CIRCULAR
1.
Information on the
Company
The Company is a developer of
clinical diagnostic solutions for lung cancer enhanced by
artificial intelligence ("AI"). Lung cancer is one of the most
lethal cancers, accounting for nearly a quarter of all
cancer-related deaths in the US. The Company's diagnostic solutions
are designed to make significant improvements in the early
detection of lung cancer.
The Company's technology is comprised
of rare-cell enrichment combined with blood-based biomarkers shown
to be altered in lung cancer. The Company employs machine learning
to improve upon existing computer software to identify informative
cells from blood, and intends to build a deep, novel pool of lung
cancer-related data for AI-enabled applications designed to improve
test performance over time.
The Company's diagnostic, the LungLB®
test, is intended to be used as a tool to provide clinicians with
additional information to help in the decision-making process for
people with indeterminate lung (pulmonary) nodules identified
following a CT scan that may be lung cancer. There are
estimated to be over 1.5 million of such people who are diagnosed
each year in the US. The LungLB® test may have other utilities, the
most significant of which is likely to be in monitoring individuals
for recurrence following surgical removal of the cancerous lung
nodule. The directors believe that the LungLB® test will provide
significant benefit when added to the clinical care pathway by both
reducing the number of unnecessary invasive procedures and by
reducing delays in treatment from the "wait-and-see"
pathway.
2.
Background to, and reasons for,
the Fundraising
Company's focus since IPO
Since the admission of the Company's
Common Stock to trading on AIM on 8 July 2021, the Company has been
focussed on two key areas: (i) the completion of its multi-site,
prospective clinical study of the LungLB® test; and (ii) laying the
foundations for its subsequent commercialisation.
(i) Clinical study
The clinical study enrolled 425 patients across
17 hospital study sites who were scheduled to receive a lung nodule
biopsy, of which 347 provided data that could be analysed. These
results were driven by a group of 98 patients with small (less than
15 mm) nodules, which represent a major challenge to physicians
practising in lung cancer detection and treatment. When developing
a precision medicine test, it is common practice to identify a
specific indicated use in order to maximise the impact on a given
patient population, which in turn helps physicians to know exactly
when to use the test. The small nodules group is the most important
indicated use for LungLB®.
In the study, LungLB® demonstrated:
·
A strong positive predictive value ("PPV") of 81 per cent. in discriminating
benign from cancerous lung nodules in patients with smaller nodules
of less than 15 mm. Smaller nodules are the most problematic area
for early detection and represent the greatest challenge for
physicians. Current clinical standards of care generate an
approximately 60 per cent. PPV, leading to material delays in
diagnosis of deadly cancers.
·
This performance in smaller nodules, similarly
demonstrated in LungLife AI's lead-in study published in June 2023,
typically represents earlier detection capability and improved
patient outcomes and highlights the test's consistency.
·
The small nodule group in this study is of utmost
importance because it is comprised of approximately 87 per cent.
"intermediate" risk nodules, which are the most challenging to
evaluate and diagnose. Previous studies lack sufficient numbers of
intermediate-risk nodules and this is the reason why existing
diagnostic tools perform poorly in this group. The Company believes
this will also be of significant value to physicians.
·
In-line with a high percentage of intermediate
risk nodules, the test also outperformed the highly validated Mayo
Risk Model nodule evaluation tool, which is a commonly used
baseline comparator, with an area under the curve (AUC) of 72 per
cent. for LungLB® compared to 62 per cent. for the Mayo
tool.
·
The results were also compared to Positron
emission tomography ("PET")
scan, another tool often employed in nodule evaluation clinics.
LungLB® outperformed PET by approximately 21 per cent. (81 per
cent. vs 67 per cent. PPV) in the small nodule group, providing
physicians with a more robust diagnostic tool in this
area.
(ii) Foundations for commercialisation
The development milestones of the
Company achieved to date, since its admission to trading on AIM in
July 2021 are summarised below.
·
In September 2022, the Company announced that the
New York State Department of Health had awarded the Company a
Clinical Laboratory Evaluation permit ("CLEP") following the CLEP's
audit, during which there were no deficiencies found.
·
In November 2022, the Company announced that it
has been granted a price of $2,030 per test by the Centers for
Medicare & Medicaid Services. The granting of the CPT
Proprietary Laboratory Analyses code was published at the beginning
of 2022.
·
In March 2023, the Company announced the
publication of its peer-reviewed health economics study, which
provided evidence that the test can be utilised as a cost-effective
alternative compared to the current diagnostic pathway.
·
In June 2023, the Company announced the
peer-reviewed publication of the results from its 151 pilot study
in BMC Pulmonary Medicine.
Each of these achievements are a
prerequisite to the commercialisation of the
LungLB® test.
Cash and use of proceeds
As announced in the Company's
half-year results on 8 August 2023, the Company's unaudited cash
balance as at 30 June 2023 was $5.36m. As at 31 December 2023, the
Company had a cash balance of $2.83m.
The Company intends to use net
proceeds of the Fundraising, along with the Company's existing cash
resources, to establish the commercial proof of concept of the
LungLB® test, as detailed below:
i.
funding of evidence generating activities, including the EAP and
clinical utility studies, dependent upon the factors noted below,
to support reimbursement and test adoption;
ii.
increasing expenditure to support engagement with payors and
clinicians, and support the wider need to raise clinical awareness
via key opinion leaders, publications and conferences;
and
iii. accelerating
the commercial pathway by pursuing licensing or other similar
agreements.
The net proceeds of the Fundraising
will allow the Company to consider all of its strategic options in
order to maximise shareholder value and, in conjunction with the
implementation of certain cost-cutting actions, is expected to
provide the Company with a cash runway to early April
2025.
Establish the commercial proof of concept of the
LungLB® test
Reimbursement in the US market
requires a methodical and deliberate approach, with the workstreams
to gain clinician adoption of the test, and to follow the
reimbursement pathways for both commercial and Medicare payors
running concurrently.
The EAP will be the first step in
clinician adoption. Under the program identified sites, which
previously participated in the Company's clinical validation study,
will be able to order a limited number of tests (unlikely to be in
excess of 100 in total across all sites), following which, in
addition to providing a test result, the Company will gather
information about the process and changes in clinical
behaviours. The program is designed to provide feedback on
the practical aspects of ordering the test and to enable the
Company to gather clinician feedback. The Company intends to
publish the findings of its EAP. While the program is
running, the Company is precluded from charging for the test as
part of this program and any tests carried on outside this program
for its duration.
The Company and its clinical
partners believe that the LungLB®
test will be clinically useful and findings
from the EAP are expected to be the initial step to evidence those
opinions as fact, which is necessary for mature
commercialisation.
In parallel with the EAP, the
Company intends to build on the work done to date on building the
billing platform and create the necessary publications and
materials to support the reimbursement of claims made to commercial
payors following completion of the EAP. The creation of a medical
dossier and other core marketing documentation will be an early
focus of the Company. As is standard practice in the US
healthcare market, it is likely that the initial claims to
commercial payors will be denied, but the approach taken by the
Company will be to ensure that a robust response is provided to
maximise the chances of securing payment at the point of first
claim.
The majority of patients who could
benefit from the LungLB®
test would be covered under Medicare, which is the
US federal health insurance programme primarily for people who are
65 or older. Medicare covers an estimated 60 million US lives, and
thus represents a sizeable portion of the LungLB® market. Reimbursement
under Medicare has its own defined pathway.
The LungLB® test has already been awarded its
code (allowing clinicians to identify the test) and price, but the
achievement of coverage under Medicare and approval of payment for
the test is dependent upon the award of a LCD. A necessary
first step for Medicare coverage is the preparation of a clinical
dossier and its submission to the Medicare Contractor for Technical
Assessment ("TA").
A key part of the TA is the
inclusion of peer reviewed publications which include evidence of
clinical utility. As noted above, peer-reviewed publications
have already been made covering the Company's health economics and
pilot study and the Company also intends to publish the results of
its clinical validation study and utility data derived from the
EAP. The nature and scope of the evidence required of
clinical utility is subjective and, as part of the usual process,
the Company will work with its Medicare contractor to define
evidence for coverage.
One of the factors determining the
nature and scope of the clinical utility study is the pathway to
the award of an LCD. There are two possible pathways, a
foundational LCD (based on evidence of utility from an existing
diagnostic test) or a specific LCD for LungLB®. The main difference
between the two is the likely timeframe within which an award could
be granted, with the former (the foundational LCD) being the
quicker option. The other difference between the two pathways
could be the nature and scope of the accompanying clinical utility
study required for coverage.
A draft proposed foundational LCD is
being considered by Palmetto, a Medicare Contractor, which, as
currently drafted, would cover the LungLB® test in certain circumstances.
The Company has provided public comment on this process and sought
to extend the circumstances under which a test would be
covered.
For the deployment of the use of
proceeds, the Company has made assumptions about the nature and
scope of the required clinical utility study and TA. The proposed
foundational LCD could be finalised later this year, however the
Company does not expect an award any sooner than the third quarter
of 2025.
3.
Current trading
The Company's interim results for
the six months ended 30 June 2023 reported a cash balance of $5.36
million and a loss before tax of $2.81 million. In the
six-month period to 31 December 2023, the Company concluded its
multi-site, prospective clinical study. The Company's total cash
balance as at 31 December 2023 was $2.83 million.
4.
VCT/EIS Placing
Shares
The Company has received advance
assurance from HMRC that the EIS Placing Shares will be eligible
shares for the purposes of the EIS. The Company has not applied for
assurance from HMRC that the VCT Placing Shares will rank as a
qualifying investment for the purposes of investment by VCTs.
Neither the Company nor its directors give any warranty or
undertaking that EIS relief or VCT qualifying status will be
granted or that, if EIS relief or VCT qualifying status is granted,
it will not be withdrawn, nor do they warrant or undertake that the
Company will conduct its activities in a way that qualifies for or
preserves its status or the status of any investment in Common
Shares. Investors considering taking advantage of any of the
reliefs under EIS should seek their own professional advice in
order that they may fully understand how the rules apply in their
individual circumstances and what they are required to do in order
to claim any reliefs (if available). As the rules governing EIS and
VCT reliefs are complex and interrelated with other legislation, if
any potential investors are in any doubt as to their tax position,
require more detailed information than the general outline above,
or are subject to tax in a jurisdiction other than the UK, they
should consult their professional advisers.
5.
Expected timetable of principal
events
Latest time and date for receipt of Forms of
Direction for the Special Meeting
|
11:00 a.m. on 18
March 2024
|
Latest time and date for receipt of Forms of
Proxy for the Special Meeting
|
11:00 a.m. on 19
March 2024
|
Special Meeting
|
11:00 a.m. on 21
March 2024
|
Admission effective and dealings in the
New Shares expected to commence on AIM
|
8:00 a.m. on 22 March
2024
|
Crediting of CREST accounts in respect of the
New Shares held as Depositary Interests (where
applicable)
|
22 March
2024
|
Dispatch of definitive share certificates in
respect of New Shares (where applicable)
|
by 05 April
2024
|
Notes:
1.
|
Each of the times and dates above is
indicative only and is subject to change. If any of the above times
and/or dates change, the revised times and/or dates will be
notified by the Company to Shareholders by announcement through a
regulatory information service.
|
2.
|
All of the above times refer to
London time unless otherwise stated.
|
APPENDIX 2 - 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. THIS ANNOUNCEMENT (INCLUDING THE APPENDICES)
AND THE TERMS AND CONDITIONS SET OUT HEREIN (THE "ANNOUNCEMENT") ARE FOR INFORMATION
PURPOSES ONLY AND ARE DIRECTED ONLY AT PERSONS WHOSE ORDINARY
ACTIVITIES INVOLVE THEM 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 (THE "EEA"),
PERSONS WHO ARE QUALIFIED INVESTORS ("QUALIFIED INVESTORS") WITHIN THE
MEANING OF ARTICLE 2(E) OF REGULATION (EU) 2017/1129 (THE
"EU PROSPECTUS
REGULATION"); (B) IF IN THE UNITED KINGDOM, QUALIFIED
INVESTORS WITHIN THE MEANING OF ARTICLE 2(E) OF THE EU PROSPECTUS
REGULATION AS IT FORMS PART OF UK DOMESTIC LAW BY VIRTUE OF THE
EUROPEAN UNION (WITHDRAWAL) ACT 2018 (THE "UK PROSPECTUS REGULATION") WHO ARE: (I)
PERSONS WHO FALL WITHIN THE DEFINITION OF "INVESTMENT PROFESSIONAL"
IN ARTICLE 19(5) OF THE FINANCIAL SERVICES AND MARKETS ACT 2000
(FINANCIAL PROMOTION) ORDER 2005, AS AMENDED (THE "ORDER"); OR (II) PERSONS WHO FALL
WITHIN ARTICLE 49(2)(A) TO (D) ("HIGH NET WORTH COMPANIES,
UNINCORPORATED ASSOCIATIONS, ETC") OF THE ORDER ("UK QUALIFIED INVESTORS"); OR (C)
PERSONS TO WHOM THEY MAY OTHERWISE BE LAWFULLY COMMUNICATED (ALL
SUCH PERSONS TOGETHER BEING REFERRED TO AS "RELEVANT PERSONS").
THIS ANNOUNCEMENT AND THE INFORMATION IN IT
MUST NOT BE ACTED ON OR RELIED ON BY PERSONS WHO ARE NOT RELEVANT
PERSONS. PERSONS DISTRIBUTING THIS ANNOUNCEMENT MUST SATISFY
THEMSELVES THAT IT IS LAWFUL TO DO SO. ANY INVESTMENT OR INVESTMENT
ACTIVITY TO WHICH THIS ANNOUNCEMENT RELATES IS AVAILABLE ONLY TO
RELEVANT PERSONS AND WILL BE ENGAGED IN ONLY WITH RELEVANT PERSONS.
THIS ANNOUNCEMENT DOES NOT ITSELF CONSTITUTE AN OFFER FOR SALE OR
SUBSCRIPTION OF ANY SECURITIES IN THE COMPANY.
EACH PLACEE SHOULD CONSULT WITH ITS OWN
ADVISERS AS TO LEGAL, TAX, BUSINESS, FINANCIAL AND RELATED ASPECTS
OF AN INVESTMENT IN THE PLACING SHARES.
THE SECURITIES REFERRED TO HEREIN HAVE NOT BEEN
AND WILL NOT BE REGISTERED UNDER THE US SECURITIES ACT OF 1933, AS
AMENDED (THE "SECURITIES
ACT"), OR UNDER THE SECURITIES LAWS OF ANY STATE OR OTHER
JURISDICTION OF THE UNITED STATES, AND MAY NOT BE OFFERED, SOLD,
ACQUIRED, RESOLD, TRANSFERRED OR DELIVERED, DIRECTLY OR INDIRECTLY
WITHIN, INTO OR IN THE UNITED STATES OR TO OR FOR THE ACCOUNT OR
BENEFIT OF US PERSONS (AS DEFINED IN REGULATION S UNDER THE
SECURITIES ACT ("REGULATION
S")), EXCEPT PURSUANT TO AN EXEMPTION FROM, OR IN A
TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE
SECURITIES ACT AND IN COMPLIANCE WITH THE SECURITIES LAWS OF ANY
RELEVANT STATE OR OTHER JURISDICTION OF THE UNITED STATES. THERE
WILL BE NO PUBLIC OFFER OF THE PLACING SHARES IN THE UNITED STATES,
THE UNITED KINGDOM, ANY OTHER RESTRICTED TERRITORY (AS DEFINED
BELOW) OR ELSEWHERE.
This Announcement, and the information
contained herein, is not for release, publication or distribution,
directly or indirectly, to persons in the United States, Australia,
Canada, Japan or South Africa or any jurisdiction in which such
release, publication or distribution is unlawful (each a
"Restricted Territory").
The distribution of this Announcement, the Placing and/or the offer
or sale of the Placing Shares in certain jurisdictions may be
restricted by law. No action has been taken by the Company or by
Investec Bank plc ("IBP")
or Investec Europe Limited (trading as Investec Europe)
("IEL"), acting on behalf
of IBP in certain jurisdictions in the EEA (IBP and IEL together,
"Investec") or Goodbody
Stockbrokers UC, trading as Goodbody ("Goodbody" and, together with Investec,
the "Joint Bookrunners") or
any of the Company or the Joint Bookrunners' respective Affiliates
or the agents, directors, officers or employees of any of them
(collectively "Representatives") which would permit an
offer of the Placing Shares or possession or distribution of this
Announcement or any other offering or publicity material relating
to such Placing Shares in any jurisdiction where action for that
purpose is required. Persons distributing any part of this
Announcement must satisfy themselves that it is lawful to do so.
Persons (including, without limitation, nominees and trustees) who
have a contractual or other legal obligation to forward a copy of
this Announcement should seek appropriate advice before taking any
such action. Persons into whose possession this Announcement comes
are required by the Company and the Joint Bookrunners to inform
themselves about, and to observe, any such restrictions.
This Announcement is for information only and
does not itself constitute or form part of an offer to sell or
issue or the solicitation of an offer to buy or subscribe for
securities referred to herein in the United States or any other
Restricted Territory or any jurisdiction where such offer or
solicitation is unlawful.
All offers of the Placing Shares will be made
pursuant to an exemption under the EU Prospectus Regulation or the
UK Prospectus Regulation, as applicable, from the requirement to
produce a prospectus. This Announcement is being distributed and
communicated to persons in the UK only in circumstances to which
section 21(1) of the Financial Services and Markets Act 2000, as
amended (the "FSMA") does
not apply.
Subject to certain exceptions, the securities
referred to in this Announcement may not be offered or sold in any
Restricted Territory or to, or for the account or benefit of, a
citizen or resident, or a corporation, partnership or other entity
created or organised in or under the laws of a Restricted
Territory.
None of the Company, the Joint Bookrunners or
any of their respective Affiliates or its or their respective
Representatives makes any representation or warranty, express or
implied, to any Placees regarding any investment in the securities
referred to in this Announcement under the laws applicable to such
Placees.
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 either Joint Bookrunner or any of their Affiliates or
its or their respective Representatives 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 party or its advisers, and any liability therefore is
expressly disclaimed.
The Joint Bookrunners are acting exclusively
for the Company and no-one else in connection with the Placing and
are not, and will not be, responsible to anyone (including the
Placees) other than the Company for providing the protections
afforded to their clients nor for providing advice in relation to
the Placing and/or any other matter referred to in this
Announcement.
Persons who are invited to and who choose to
participate in the Placing (and any person acting on such person's
behalf) by making an oral or written offer to subscribe for Placing
Shares, including any individuals, funds or others on whose behalf
a commitment to subscribe for Placing Shares is given (the
"Placees") will be deemed (i) to have read and understood this
Announcement, including this Appendix and Appendix 1, in its
entirety; (ii) to be participating and making such offer on the
terms and conditions contained in this Appendix; and (iii) to be
providing (and shall only be permitted to participate in the
Placing on the basis that they have provided) the representations,
warranties, undertakings, agreements, acknowledgments and
indemnities contained in this Appendix.
In particular, each such Placee represents,
warrants, undertakes, agrees and acknowledges that:
1.
it is a Relevant Person and undertakes that it
will subscribe for, hold, manage or dispose of any Placing Shares
that are allocated to it for the purposes of its
business;
2.
if it is in a member state of the EEA, it is a
Qualified Investor;
3.
if it is in the United Kingdom, it is a UK
Qualified Investor;
4.
it is subscribing for Placing Shares for its own
account or is subscribing for Placing Shares for an account with
respect to which it exercises sole investment discretion and has
the authority to make and does make the representations,
warranties, undertakings, agreements, acknowledgments and
indemnities contained in this Announcement;
5.
if it is a financial intermediary, as that term is
used in Article 5(1) of the EU Prospectus Regulation or the UK
Prospectus Regulation (as applicable): (i) the Placing Shares
subscribed for by it in the Placing will not be subscribed for on a
non-discretionary basis on behalf of, nor will they be subscribed
for with a view to their offer or resale to, persons in a member
state of the EEA other than Qualified Investors, or persons in the
United Kingdom other than UK Qualified Investors or in
circumstances in which the prior consent of the Joint Bookrunners
has been given to each proposed offer or resale; or (ii) where the
Placing Shares have been subscribed for by it on behalf of persons
in a member state of the EEA other than Qualified Investors, or in
the United Kingdom other than UK Qualified Investors, the offer of
those Placing Shares to it is not treated under the EU Prospectus
Regulation or the UK Prospectus Regulation (as applicable) as
having been made to such persons;
6.
it understands that the Placing Shares have not
been and will not be registered under the Securities Act or with
any securities regulatory authority of any state or other
jurisdiction of the United States and may not be offered, sold or
transferred, directly or indirectly, within the United States or to
or for the account or benefit of US persons (as defined in
Regulation S) 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;
7.
it and the person(s), if any, for whose account or
benefit it is acquiring the Placing Shares (i) are not a US person;
(ii) are purchasing the Placing Shares outside of the United
States in accordance with Section 903(b)(3), or Category 3, of
Regulation S and otherwise in accordance with applicable laws;;
(iii) are aware of the restrictions on the offer and sale of the
Placing Shares pursuant to Regulation S; and (iii) agrees and
acknowledges that the Placing Shares have not been offered to it by
means of any "directed selling efforts" as defined in Regulation S;
and
8.
the Company and the Joint Bookrunners will rely
upon the truth and accuracy of, and compliance with, the foregoing
representations, warranties, undertakings, agreements and
acknowledgements. Each Placee hereby agrees with the Joint
Bookrunners and the Company to be bound by these terms and
conditions as being the terms and conditions upon which Placing
Shares will be issued. A Placee shall, without limitation, become
so bound if either Joint Bookrunner confirms (orally or in writing)
to such Placee its allocation of Placing Shares.
IMPORTANT
INFORMATION FOR PLACEES ONLY REGARDING THE
PLACING
Bookbuild
Following this Announcement, the Joint
Bookrunners will today commence the Bookbuild to determine demand
for participation in the Placing by Placees. No commissions will be
paid to Placees or by Placees in respect of any Placing Shares. The
book will open with immediate effect.
The Joint Bookrunners and the Company shall be
entitled to effect the Placing by such alternative method to the
Bookbuild as they may, in their sole discretion,
determine.
Details of the
Placing Agreement and of the Placing Shares
Investec and Goodbody are acting as joint
bookrunners in connection with the Placing.
The Joint Bookrunners have today entered into
an agreement with the Company (the "Placing Agreement") under which,
subject to the conditions set out therein, each Joint Bookrunner
has agreed, each as agent for and on behalf of the Company, to use
its reasonable endeavours to procure Placees for the Placing Shares
at a price of 35 pence per Placing Share (the "Issue Price") in such number to be
determined following completion of the Bookbuild. The final number
of Placing Shares will be determined by the Company and the Joint
Bookrunners at the close of the Bookbuild and will be set out in
the executed terms of placing terms (the "Placing Terms"). The timing of the
closing of the book, pricing and allocations are at the discretion
of the Company and the Joint Bookrunners. Details of the number of
Placing Shares will be announced as soon as practicable after the
close of the Bookbuild. The Fundraising is not
underwritten.
The New Shares will, when issued, be credited
as fully paid and will rank pari passu in all respects with the
existing Common Shares, including the right to receive all
dividends and other distributions declared, made or paid in respect
of the New Shares after the Closing Date. The New Shares will be
issued free of any encumbrances, liens or other security
interests.
Application
for admission to trading
An application will be made to London Stock
Exchange plc (the "London Stock
Exchange") for admission of the New Shares to trading on AIM
("Admission"). Subject to
the passing of the Resolutions, it is expected that Admission will
become effective at 8.00 a.m. on 22 March 2024 or such later time
and date (being not later than 8.00 a.m. on 4 April 2024) as the
Joint Bookrunners and the Company may agree.
Participation
in, and principal terms of, the Placing
1.
The Joint Bookrunners are arranging the Placing
severally, and not jointly, nor jointly and severally, as agents of
the Company.
2.
Participation in the Placing will only be
available to persons who may lawfully be, and are, invited to
participate by either Joint Bookrunner. Each Joint Bookrunner and
their Affiliates are entitled to enter bids in the Bookbuild as
principal.
3.
The results of the Placing and the number of
Placing Shares will be announced on a Regulatory Information
Service following the completion of the Bookbuild.
4.
To bid in the Bookbuild, prospective Placees
should communicate their bid by telephone or in writing to their
usual sales contact at one of the Joint Bookrunners. Each bid
should state the number of Placing Shares which the prospective
Placee wishes to subscribe for at the Issue Price. Bids may be
scaled down by the Joint Bookrunners in their sole
discretion.
5.
A bid in the Bookbuild will be made on the terms
and subject to the conditions in this Appendix and will be legally
binding on the Placee on behalf of which it is made and, except
with the consent of the relevant Joint Bookrunner, will not be
capable of variation or revocation after the time at which it is
submitted. Each Placee's obligations will be owed to the Company
and each Joint Bookrunner. Each Placee will also have an immediate,
separate, irrevocable and binding obligation, owed to each Joint
Bookrunner, to pay to the Joint Bookrunners (or as the Joint
Bookrunners may direct) as agents for the Company in cleared funds
an amount equal to the product of the Issue Price and the number of
Placing Shares that such Placee has agreed to subscribe for and the
Company has agreed to allot and issue to that Placee.
6.
The Bookbuild is expected to close no later than
7.00 a.m. (London time) on 05 March 2024, but may be closed earlier
or later at the discretion of the Joint Bookrunners. The Joint
Bookrunners may, in agreement with the Company, accept bids that
are received after the Bookbuild has closed.
7.
Each Placee's allocation will be determined by the
Company in consultation with the Joint Bookrunners and will be
confirmed to Placees orally or in writing by the relevant Joint
Bookrunners following the close of the Bookbuild and a trade
confirmation will be dispatched as soon as possible thereafter.
That oral or written confirmation (at the Joint Bookrunners'
discretion) to such Placee will constitute an irrevocable legally
binding commitment upon such person (who will at that point become
a Placee) in favour of the Joint Bookrunners and the Company, under
which such Placee agrees to subscribe for the number of Placing
Shares allocated to it and to pay the Issue Price for each such
Placing Share on the terms and conditions set out in this Appendix
and in accordance with the Company's constitutional
documents.
8.
The Joint Bookrunners may, notwithstanding
paragraphs 4 and 6 above, and subject to the prior consent of the
Company: (i) allocate Placing Shares after the time of any initial
allocation to any person submitting a bid after that time; and (ii)
allocate Placing Shares after the Bookbuild has closed to any
person submitting a bid after that time. The acceptance of bids
shall be at the absolute discretion of the Joint Bookrunners. The
Company reserves the right (upon agreement with the Joint
Bookrunners) to reduce or seek to increase the amount to be raised
pursuant to the Placing.
9.
Except as required by law or regulation, no press
release or other announcement will be made by either Joint
Bookrunner or the Company using the name of any Placee (or its
agent), in its capacity as Placee (or agent), other than with such
Placee's prior written consent.
10.
Irrespective of the time at which a Placee's
allocation(s) pursuant to the Placing is/are confirmed, settlement
for all Placing Shares to be subscribed for pursuant to the Placing
will be required to be made at the same time on the basis explained
below under "Registration and settlement".
11.
All obligations under the Bookbuild and Placing
will be subject to fulfilment or (where applicable) waiver of the
conditions referred to below under "Conditions of the Placing" and
to the Placing not being terminated on the basis referred to below
under "Termination of the Placing Agreement".
12.
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 after
confirmation (oral or otherwise) by either Joint
Bookrunner.
13.
By participating in the Placing, each Placee
agrees with the Company and the Joint Bookrunners that the exercise
or non-exercise by the Joint Bookrunners of any right of
termination or other right or other discretion under the Placing
Agreement shall be within the absolute discretion of the Joint
Bookrunners or for agreement between the Company and the Joint
Bookrunners (as the case may be) and that neither the Company nor
the Joint Bookrunners need make any reference to, or consult with,
Placees and that none of the Company, neither Joint Bookrunner nor
any of their respective Affiliates or its or their respective
Representatives shall have any liability to Placees whatsoever in
connection with any such exercise or failure to so exercise or
otherwise.
14.
To the fullest extent permissible by law, none of
the Company, the Joint Bookrunners nor any of their Affiliates nor
any of its or their respective Representatives shall have any
responsibility or liability to any Placee (or to any other person
whether acting on behalf of a Placee or otherwise and whether or
not a recipient of this document). In particular, none of the
Company, the Joint Bookrunners nor any of their Affiliates nor any
of its or their respective Representatives shall have any
responsibility or liability (whether in contract, tort or otherwise
and including, to the fullest extent permissible by law, any
fiduciary duties) in respect of the Joint Bookrunners' conduct of
the Bookbuild or of such alternative method of effecting the
Placing as the Joint Bookrunners and their respective Affiliates
and the Company may agree.
Conditions of
the Placing
The Placing is conditional upon the Placing
Agreement becoming unconditional and not having been terminated in
accordance with its terms. The obligations of the Joint Bookrunners
under the Placing Agreement are conditional on certain conditions,
including, amongst other things:
(a) the
Placing Terms having been executed by the Company and the Joint
Bookrunners;
(b) the
publication by the Company of the Placing Terms Announcement
through a Regulatory Information Service immediately following the
execution of the Placing Terms;
(c)
the passing of the Resolutions (without amendment) at the Special
Meeting on the Special Meeting Date (or such later time and date as
the Company and the Joint Bookrunners may agree in writing) and
such Resolutions remaining in full force and effect;
(d)
prior to Admission, the receipt of advanced assurances from HMRC in
respect of tax relief available to Placees applying for VCT/EIS
Placing Shares in respect of which EIS relief is expected to be
claimed and comfort letters from advisors in relation to the
VCT/EIS Placing Shares constituting a qualifying holding for VCT
purposes;
(e) the
Company and the directors having complied in all material respects
with their respective obligations under the Placing Agreement to
the extent that the same fall to be performed prior to
Admission;
(f)
there being no breach of any of the warranties given by the Company
contained in the Placing Agreement;
(g) the
Company having allotted, subject only to Admission, the Placing
Shares in accordance with the Placing Agreement;
(h) (i)
entry into each Subscription Agreement by the parties thereto; (ii)
each Subscription Agreement remaining in full force and effect, not
having lapsed or been terminated or amended in accordance with its
terms prior to Admission; (iii) no condition to which such document
is subject having become incapable of satisfaction and not having
been waived prior to Admission; and (iv) no event having arisen
prior to Admission which gives a party thereto a right to terminate
such document;
(i)
there not occurring prior to Admission, in the opinion of the Joint
Bookrunners (acting jointly and in good faith and after
consultation, to the extent it is reasonably practicable, with the
Company), a Material Adverse Change in the context of the Placing;
and
(j)
Admission occurring by 8.00 a.m. on 22 March 2024 (or such later
time and/or date as the Joint Bookrunners and the Company may agree
in writing, being not later than 8.00 a.m. on 4 April
2024),
(all conditions to the obligations of the Joint
Bookrunners included in the Placing Agreement being together, the
"Conditions").
If any of the Conditions are not fulfilled or,
where permitted, waived or extended by the Joint Bookrunners in
accordance with the Placing Agreement, the Placing will lapse and
the Placees' rights and obligations hereunder in relation to the
Placing Shares shall cease and terminate at such time and each
Placee agrees that no claim can be made by or on behalf of the
Placee (or any person on whose behalf the Placing is acting) in
respect thereof.
The Joint Bookrunners (acting jointly) may, at
their discretion and upon such terms and conditions as they think
fit, waive satisfaction of certain of the Conditions (save that
Conditions (a), (b), (c), (d), (g), and (j) cannot be waived) or
extend the time provided for their satisfaction. Any such waiver or
extension will not affect Placees' commitments as set out in this
Announcement.
Neither Joint Bookrunner nor any of their
Affiliates or its or their respective Representatives shall have
any liability or responsibility to any Placee (or to any other
person whether acting on behalf of a Placee or otherwise) in
respect of any decision it or another person may make as to whether
or not to waive or to extend the time and/or date for the
satisfaction of any Condition nor for any decision it may make as
to the satisfaction of any Condition or in respect of the Placing
generally and by participating in the Placing each Placee agrees
that any such decision is within the absolute discretion of the
Joint Bookrunners. Placees will have no rights against the Joint
Bookrunners, the Company or any of their respective Affiliates
under the Placing Agreement pursuant to the Contracts (Rights of
Third Parties) Act 1999 (as amended) or otherwise.
By participating in the Bookbuild, each Placee
agrees that its rights and obligations hereunder terminate only in
the circumstances described above and under "Termination of the
Placing Agreement" below, and will not be capable of rescission or
termination by the Placee.
Termination of
the Placing Agreement
Each Joint Bookrunner, in its absolute
discretion, may prior to Admission terminate the Placing Agreement
in accordance with its terms in certain circumstances, including,
amongst other things:
(a) any
statement in any document or announcement issued or published by or
on behalf of the Company in connection with the Fundraising is or
has become or is discovered to be untrue, inaccurate or misleading,
or any matter has arisen or has been discovered which would, if
such document or announcement were to be issued at that time,
constitute an omission therefrom and which, in each case, is in the
opinion of either Joint Bookrunner (acting in good faith), material
in the context of the Placing;
(b)
there has been, in the opinion of either Joint Bookrunner (acting
in good faith), a breach by the Company of any of the warranties or
representations contained in the Placing Agreement;
(c)
there has been a breach of any provision of any Subscription
Agreement or waiver of any condition thereto, in each case, by the
Company;
(d) the
Company fails to comply in any material respects with its
obligations under the Placing Agreement;
(e) in
the opinion of either Joint Bookrunner (acting in good faith),
there has been a Material Adverse Change in the context of the
Placing;
(f)
upon the occurrence of certain force majeure events; or
(g) if
the application for Admission is withdrawn by the Company or
refused by the London Stock Exchange (as appropriate).
If circumstances arise that would allow either
Joint Bookrunner to terminate the Placing Agreement, the other
Joint Bookrunner may nevertheless determine to allow the Admission
to proceed. In addition, if both Joint Bookrunners do not give
notice to terminate the Placing Agreement in circumstances where
they are able, the Joint Bookrunner who does not give such notice
may allow Admission to proceed and will assume the obligations
which remain to be performed under the Placing Agreement by the
Joint Bookrunner who has given notice to terminate.
If the Placing Agreement is terminated in
accordance with its terms, the rights and obligations of each
Placee in respect of the Placing as described in this Announcement
shall cease and terminate at such time and no claim may be made by
any Placee in respect thereof.
No prospectus
or admission document
No prospectus, offering memorandum, offering
document or admission document has been or will be prepared or
submitted to be approved by the FCA (or any other authority) in
relation to the Placing or Admission and no such prospectus is
required (in accordance with the UK Prospectus Regulation or
otherwise) to be published in the United Kingdom or any equivalent
jurisdiction.
Placees' commitments will be made solely on the
basis of the information contained in this Announcement and any
Exchange Information (as defined below) and subject to the further
terms set forth in the electronic contract note and/or electronic
trade confirmation to be provided to individual prospective Placees
(save that in the case of Exchange Information, a Placee's right to
rely on that information is limited to the right that such Placee
would have as a matter of law in the absence of this
paragraph).
Each Placee, by accepting a participation in
the Placing, agrees that the content of this Announcement and the
Exchange Information previously and simultaneously released by or
on behalf of the Company is exclusively the responsibility of the
Company and has not been independently verified by the Joint
Bookrunners. Each Placee, by accepting a participation in the
Placing, further confirms to the Company and each Joint Bookrunner
that it has neither received nor relied on any other information,
representation, warranty or statement made by or on behalf of the
Company (other than publicly available information) or the Joint
Bookrunners or its Affiliates or any other person and none of the
Company, the Joint Bookrunners nor any of their respective
Affiliates or its or their respective Representatives nor any other
person will be liable for any Placee's decision to participate in
the Placing based on any other information, representation,
warranty or statement which the Placees may have obtained or
received (regardless of whether or not such information,
representation, warranty or statement was given or made by or on
behalf of any such persons). By participating in the Placing, 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 or limit the liability of any person
for fraudulent misrepresentation by that person.
Lock-up
The Company has undertaken to the Joint
Bookrunners that, between the date of the Placing Agreement and the
date which is 180 calendar days after the Closing Date, it will
not, without the prior written consent of the Joint Bookrunners,
issue, allot, offer or enter into certain other transactions
involving the transfer or disposal of the Common Shares. This
agreement is subject to certain customary carve-outs agreed between
the Joint Bookrunners and the Company.
By participating in the Placing, Placees agree
that the exercise by the Joint Bookrunners of any power to grant
consent to waive the aforementioned undertaking by the Company
shall be within the absolute discretion of the Joint Bookrunners
and that they need not make any reference to, or consult with,
Placees and that it shall have no liability to Placees whatsoever
in connection with any such exercise of the power to grant
consent.
Registration
and settlement
Settlement of transactions in the Placing
Shares (temporary ISIN: USU5500L1128 and TIDM: LLA) with the marker
(REG S Cat 3) following Admission will take place within the CREST
system, subject to certain exceptions. The Company and the Joint
Bookrunners reserve the right to require settlement for, and
delivery of, Depositary Interests representing the Placing Shares
or Placing Shares to Placees by such other means that they deem
necessary, including in certificated form, if delivery or
settlement is not possible or practicable within the CREST system
within the timetable set out in this Announcement or would not be
consistent with the regulatory requirements in the Placee's
jurisdiction. The Placing Shares will be subject to restrictions on
re-sales until the expiry of one year after the later of (i) the
time when the New Shares are first offered to persons other than
distributors in reliance upon Regulation S; and (ii) the date of
closing of the Fundraising, or such longer period as the Company
may determine it as may be required under applicable law following
which the ISIN may be merged with the ISIN for the Company's
existing shares. Further details of these restrictions are set out
below under "US restrictions on the transfer of Common
Shares".
Each Placee agrees that it will do all things
necessary to ensure that delivery and payment is completed in
accordance with the standing CREST or certificated settlement
instructions that it has in place with the Settlement Bank or
otherwise as the Settlement Bank may direct.
The Company will deliver Depositary Interests
representing the Placing Shares to a CREST account operated by the
Settlement Bank as agent for and on behalf of the Company and the
Settlement Bank will enter its delivery (DEL) instruction into the
CREST system. The Settlement Bank will hold any Depositary
Interests representing Placing Shares delivered to this account as
nominee for the Placees. The input to CREST by a Placee of a
matching or acceptance instruction will then allow delivery of the
relevant Depositary Interests representing Placing Shares to that
Placee against payment. Subject to the passing of the Resolutions,
it is expected that settlement of the Placing Shares will be on 22
March 2024 and will be on a delivery versus payment basis in
accordance with the instructions given to the Joint
Bookrunners.
Interest is chargeable daily on payments not
received from Placees on the due date in accordance with the
arrangements set out above, in respect of either CREST or
certificated deliveries, at the rate of two percentage points above
SONIA as determined by the Joint Bookrunners.
Each Placee agrees that, if it does not comply
with these obligations, the relevant Placee shall be deemed hereby
to have irrevocably and unconditionally appointed the Joint
Bookrunners, or any nominee of the Joint Bookrunners as its agent
to use its reasonable endeavours to sell any or all of the Placing
Shares allocated to that Placee on such Placee's behalf and retain
from the proceeds (as agent for and on behalf of the Company) an
amount equal to the aggregate amount owed by the Placee plus any
interest due thereon. The relevant Placee will, however, remain
liable for any shortfall below the aggregate amount owed by it and
shall be required to bear any stamp duty, stamp duty reserve tax or
other stamp, securities, transfer, registration, execution,
documentary or other similar impost, duty or tax (together with any
interest, fines or penalties) which may arise upon the sale of such
Placing Shares on such Placee's behalf. By communicating a bid for
Placing Shares, each Placee confers on each Joint Bookrunners all
such authorities and powers necessary to carry out any such
transaction and agrees to ratify and confirm all actions which each
Joint Bookrunner lawfully takes on such Placee's behalf. Each
Placee agrees that each Joint Bookrunners' rights and benefits
under this paragraph may be assigned in that Joint Bookrunner's
discretion.
If Placing Shares are to be delivered to a
custodian or settlement agent, Placees should ensure that, upon
receipt, the electronic contract note and/or electronic trade
confirmation is copied and delivered immediately to the relevant
person within that organisation. Insofar as Placing Shares are
registered in a Placee's name or that of its nominee or in the name
of any person for whom a Placee is contracting as agent or that of
a nominee for such person, such Placing Shares should, subject as
provided below, be so registered free from any liability to UK
stamp duty or UK stamp duty reserve tax. If there are any
circumstances in which any other stamp duty or stamp duty reserve
tax (and/or any interest, fines or penalties relating thereto) is
payable in respect of the allocation, allotment, issue or delivery
of the Placing Shares (or, for the avoidance of doubt if any stamp
duty or stamp duty reserve tax is payable in connection with any
subsequent transfer of or agreement to transfer Placing Shares),
neither Joint Bookrunner nor the Company shall be responsible for
the payment thereof.
Representations and
warranties
By participating in the Placing, each Placee
(and any person acting on such Placee's behalf) irrevocably
acknowledges, confirms, undertakes, represents, warrants and agrees
(for itself and for any person on behalf of which it is acting)
with each Joint Bookrunner (in their capacity as bookrunner and as
placing agent of the Company in respect of the Placing) and the
Company, in each case as a fundamental term of its application for
Placing Shares, that:
1.
it has read and understood this Announcement,
including this Appendix and Appendix 1, in its entirety and that
its participation in the Bookbuild and the Placing and its
subscription for Placing Shares is subject to and based upon all
the terms, conditions, representations, warranties, indemnities,
acknowledgements, agreements and undertakings and other information
contained herein and undertakes not to redistribute or duplicate
this Announcement and that it has not relied on, and will not rely
on, any information given or any representations, warranties or
statements made at any time by any person in connection with
Admission, the Bookbuild, the Placing, the Company, the Placing
Shares or otherwise;
2.
no offering document, prospectus, offering
memorandum or admission document has been or will be prepared in
connection with the Placing or is required under the EU Prospectus
Regulation or the UK Prospectus Regulation and it has not received
and will not receive a prospectus, offering memorandum, admission
document or other offering document in connection with the
Bookbuild, the Placing, Admission or the Placing Shares;
3.
(i) it has made its own assessment of the Company,
the Placing Shares and the terms of the Placing based on this
Announcement (including this Appendix and Appendix 1) and any
information publicly announced to a Regulatory Information Service
by or on behalf of the Company on or prior to the date of this
Announcement; (ii) the Common Shares are admitted to trading on AIM
and that the Company is therefore required to publish certain
business and financial information in accordance with the UK Market
Abuse Regulation and rules and regulations of the London Stock
Exchange (including the AIM Rules) (collectively and together with
the information referred to in (i) above, the "Exchange
Information") which includes a
description of the Company's business and the Company's most recent
balance sheet and profit and loss account, and similar statements
for preceding financial years, and that it has reviewed such
Exchange Information and that it is able to obtain or access such
information, or comparable information concerning any other
publicly traded company, in each case without undue difficulty; and
(iii) it has had access to such financial and other information
concerning the Company, the Placing and the Placing Shares as it
has deemed necessary in connection with its own investment decision
to subscribe for any of the Placing Shares and has satisfied itself
that the information is still current and has relied on that
investigation for the purposes of its decision to participate in
the Placing;
4.
neither Joint Bookrunner nor the Company nor any
of their respective Affiliates or its or their respective
Representatives nor any person acting on behalf of any of them has
provided, and none of them will provide, it with any material or
information regarding the Placing Shares, the Bookbuild, the
Placing or the Company or any other person other than this
Announcement, nor has it requested either Joint Bookrunner, the
Company, any of their respective Affiliates or its or their
respective Representatives or any person acting on behalf of any of
them to provide it with any such material or
information;
5.
unless otherwise specifically agreed with the
Joint Bookrunners, it and any person on behalf of which it is
participating is not, and at the time the Placing Shares are
subscribed for, neither it nor the beneficial owner of the Placing
Shares will be, a resident of a Restricted Territory or any other
jurisdiction in which it is unlawful to make or accept an offer to
acquire the Placing Shares;
6.
the Placing Shares have not been and will not be
registered or otherwise qualified, for offer and sale, nor will an
offering document, prospectus, offering memorandum or admission
document be cleared or approved in respect of any of the Placing
Shares under the securities legislation of the United States or any
other Restricted Territory and, subject to certain exceptions, may
not be offered, sold, transferred, delivered or distributed,
directly or indirectly, in or into those jurisdictions or in any
country or jurisdiction where any such action for that purpose is
required;
7.
the content of this Announcement has been prepared
by and is exclusively the responsibility of the Company and that
neither Joint Bookrunner nor any of their Affiliates or its or
their respective Representatives nor any person acting on behalf of
any of them has made any representations to it, express or implied,
with respect to the Company, the Bookbuild, the Placing and the
Placing Shares or the truth, accuracy, completeness or adequacy of
this Announcement or the Exchange Information, nor has or shall
have any responsibility or liability for any information,
representation or statement contained in this Announcement or any
information previously or simultaneously published by or on behalf
of the Company, including, without limitation, any Exchange
Information, and will not be liable for any Placee's decision to
participate in the Placing based on any information, representation
or statement contained in this Announcement or any information
previously or simultaneously published by or on behalf of the
Company or otherwise. Nothing in this paragraph or otherwise in
this Announcement excludes the liability of any person for
fraudulent misrepresentation made by that person;
8.
the only information on which it is entitled to
rely and on which such Placee has relied in committing itself to
subscribe for the Placing Shares is contained in this Announcement
and any Exchange Information, that it has received and reviewed all
information that it believes is necessary or appropriate to make an
investment decision in respect of the Placing Shares, and that it
has neither received nor relied on any other information given or
investigations, representations, warranties or statements made by
either Joint Bookrunner or the Company or any of their respective
Affiliates or its or their respective Representatives or any person
acting on behalf of any of them and neither Joint Bookrunner nor
the Company nor any of their respective Affiliates or its or their
respective Representatives will be liable for any Placee's decision
to accept an invitation to participate in the Placing based on any
other information, representation, warranty or
statement;
9.
it has relied on its own investigation,
examination and due diligence of the business, financial or other
position of the Company in deciding to participate in the
Placing;
10.
it has not relied on any information relating to
the Company contained in any research reports prepared by either
Joint Bookrunner, any of their Affiliates or any person acting on
its or their behalf and understands that: (i) neither Joint
Bookrunner nor any of their Affiliates nor any person acting on its
or their behalf has or shall have any responsibility or liability
for: (x) public information or any representation; or (y) any
additional information that has otherwise been made available to
such Placee, whether at the date of publication, the date of this
Announcement or otherwise; and (ii) neither Joint Bookrunner nor
any of their Affiliates nor any person acting on its or their
behalf makes any representation or warranty, express or implied, as
to the truth, accuracy or completeness of such information, whether
at the date of publication, the date of this Announcement or
otherwise;
11.
(i) the allocation, allotment, issue and delivery
to it, or the person specified by it for registration as holder of
Placing Shares will not give rise to a liability under any of
sections 67, 70, 93 or 96 of the Finance Act 1986 (depositary
receipts and clearance services); (ii) it is not participating in
the Placing as nominee or agent for any person to whom the
allocation, allotment, issue or delivery of the Placing Shares
would give rise to such a liability; and (iii) the Placing Shares
are not being acquired in connection with arrangements to issue
depositary receipts or to issue or transfer Placing Shares into a
clearance service;
12.
that no action has been or will be taken by the
Company, either Joint Bookrunner or any person acting on behalf of
the Company or either Joint Bookrunner that would, or is intended
to, permit a public offer of the Placing Shares in the United
States or in any country or jurisdiction where any such action for
that purpose is required;
13.
(i) it (and any person acting on its behalf) is
entitled to subscribe for, the Placing Shares under the laws of all
relevant jurisdictions which apply to it; (ii) it has paid or will
pay any issue, transfer or other taxes due in connection with its
participation in any territory; (iii) it has fully observed such
laws and obtained all such governmental and other guarantees,
permits, authorisations, approvals and consents which may be
required thereunder and complied with all necessary formalities;
(iv) it has not taken any action or omitted to take any action
which will or may result in either Joint Bookrunner, the Company or
any of their respective Affiliates or its or their respective
Representatives acting in breach of the legal or regulatory
requirements of any jurisdiction in connection with the Placing;
and (v) the subscription for the Placing Shares by it or any person
acting on its behalf will be in compliance with applicable laws and
regulations in the jurisdiction of its residence, the residence of
the Company, or otherwise;
14.
it (and any person acting on its behalf) has all
necessary capacity and has obtained all necessary consents and
authorities to enable it to commit to its 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 this Announcement) and
will honour such obligations;
15.
it has complied with its obligations under the
Criminal Justice Act 1993, the UK Market Abuse Regulation, any
delegating acts, implementing acts, technical standards and
guidelines, and in connection with money laundering and terrorist
financing under the Proceeds of Crime Act 2002, the Terrorism Act
2000, the Anti-Terrorism Crime and Security Act 2001, the Terrorism
Act 2006, the Money Laundering, Terrorist Financing and Transfer of
Funds (Information on the Payer) Regulations 2017, the FCA's SYSC
and any related or similar rules, regulations or guidelines issued,
administered or enforced by any government agency having
jurisdiction in respect thereof (together the "Regulations") and, if making
payment on behalf of a third party, that satisfactory evidence has
been obtained and recorded by it to verify the identity of the
third party as required by the Regulations. If within a reasonable
time after a request for verification of identity, the relevant
Joint Bookrunner has not received such satisfactory evidence, such
Joint Bookrunner may, in its absolute discretion, terminate the
Placee's Placing participation in which event all funds delivered
by the Placee to such Joint Bookrunner will be returned without
interest to the account of the drawee bank or CREST account from
which they were originally debited;
16.
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, and does make, the
acknowledgments, undertakings, representations and agreements and
give the indemnities herein on behalf of each such person; and (ii)
it is and will remain liable to each Joint Bookrunner and the
Company 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). Each Placee agrees that the provisions of this
paragraph shall survive the resale of the Placing Shares by or on
behalf of any person for whom it is acting;
17.
it is a Relevant Person and undertakes that it
will (as principal or agent) subscribe for, hold, manage and (if
applicable) dispose of any Placing Shares that are allocated to it
for the purposes of its business only;
18.
it understands that any investment or investment
activity to which this Announcement relates is available only to
Relevant Persons and will be engaged in only with Relevant Persons,
and further understands that this Announcement must not be acted on
or relied on by persons who are not Relevant Persons;
19.
if it is in a member state of the EEA, it is a
Qualified Investor;
20.
if it is in the United Kingdom, it is a UK
Qualified Investor;
21.
in the case of any Placing Shares subscribed for
by it as a financial intermediary, as that term is used in Article
5(1) of the EU Prospectus Regulation or the UK Prospectus
Regulation (as applicable), (i) the Placing Shares subscribed for
by it in the Placing will not be subscribed for on a
non-discretionary basis on behalf of, nor will they be subscribed
for with a view to their offer or resale to persons in a member
state of the EEA other than Qualified Investors, or persons in the
United Kingdom other than UK Qualified Investors or in
circumstances in which the prior consent of the Joint Bookrunners
has been given to each such proposed offer or resale; or (ii) where
the Placing Shares have been subscribed for by it on behalf of
persons in any member state of the EEA other than Qualified
Investors, or in the United Kingdom other than UK Qualified
Investors, the offer of those Placing Shares to it is not treated
under the EU Prospectus Regulation or the UK Prospectus Regulation
(as applicable) as having been made to such persons;
22.
it understands, and each account it represents has
been advised that, (i) the Placing Shares have not been and will
not be registered under the Securities Act or under the applicable
securities laws of any state or other jurisdiction of the United
States and may not be offered, sold or resold in or into or
from the United States or to or for the account or benefit of
a US person, except pursuant to an exemption from, or in a
transaction not subject to, the registration requirements of the
Securities Act and in accordance with applicable state securities
laws; and (ii) no representation has been made as to the
availability of any exemption under the Securities Act or any
relevant state or other jurisdiction's securities laws for the
reoffer, resale, pledge or transfer of the Placing
Shares;
23.
the Placing Shares are being offered and sold on
behalf of the Company outside the United States to non-US persons
in offshore transactions as defined in and pursuant to Regulation
S;
24.
it and the prospective beneficial owner of the
Placing Shares is, and at the time the Placing Shares are
subscribed for will be, outside the United States and not a US
person and subscribing for the Placing Shares in an "offshore
transaction" as defined in, and in accordance with, Regulation S
under the Securities Act, and they are not subscribing for the
Placing Shares with a view to the offer, sale, resale, transfer,
delivery or distribution, directly or indirectly of any Placing
Shares into the United States;
25.
it understands that the Placing Shares are subject
to the restrictions of Category 3 of Regulation set forth in Rule
903(b)(3) of Regulation S and accordingly the Placing Shares are
subject to a one-year distribution compliance period during which
they may be resold only in accordance with Regulation S or pursuant
to an available exemption from registration under the Securities
Act, and the such Placing Shares will be "restricted securities" as
defined in Rule 144 under the US Securities Act and will not be
eligible for legend removal until the expiration of the one-year
distribution compliance period of 12 months after
Admission;
26.
it will not distribute, forward, transfer or
otherwise transmit this Announcement or any part of it, or any
other presentation or other materials concerning the Placing
(including electronic copies thereof), in or into any Restricted
Territory to any person and it has not distributed, forwarded,
transferred or otherwise transmitted any such materials to any
person;
27.
where it is subscribing for the Placing Shares for
one or more managed accounts, it is authorised in writing by each
managed account to subscribe for the Placing Shares for each
managed account and it has full power to make, and does make, the
acknowledgements, representations and agreements herein on behalf
of each such account;
28.
if it is a pension fund or investment company, its
subscription for Placing Shares is in full compliance with
applicable laws and regulations;
29.
it has not offered or sold and, prior to the
expiry of a period of six months from Admission, will not offer or
sell any Placing Shares to persons in the United Kingdom, except to
persons whose ordinary activities involve them acquiring, holding,
managing or disposing of investments (as principal or agent) for
the purposes of its business or otherwise in circumstances which
have not resulted and which will not result in an offer to the
public in the United Kingdom within the meaning of section 85(1) of
the FSMA;
30.
any offer of Placing Shares may only be directed
at persons in member states of the EEA who are Qualified Investors
and that it has not offered or sold and will not offer or sell any
Placing Shares to persons in the EEA prior to Admission except to
Qualified Investors or otherwise in circumstances which have not
resulted in and which will not result in an offer to the public in
any member state of the EEA within the meaning of the EU Prospectus
Regulation;
31.
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 the FSMA) relating to the
Placing Shares in circumstances in which section 21(1) of the FSMA
does not require approval of the communication by an authorised
person;
32.
it has complied and will comply with all
applicable laws (including, in the United Kingdom, all relevant
provisions of the FSMA and the Financial Services Act 2012) with
respect to anything done by it in relation to the Placing
Shares;
33.
if it has received any "inside information" as
defined in the UK Market Abuse Regulation 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 except as permitted by the UK Market Abuse
Regulation, prior to the information being made publicly
available;
34.
(i) it (and any person acting on its behalf) has
the funds available to pay for the Placing Shares it has agreed to
subscribe for and it (and any person acting on its behalf) will
make payment for the Placing Shares allocated to it in accordance
with this Announcement on the due time and date set out herein
against delivery of such Placing Shares or Depositary Interests
representing such Placing Shares to it, failing which the relevant
Placing Shares may be placed with other persons or sold as either
Joint Bookrunner (or its assignee) may in its discretion determine
and without liability to such Placee. It will, however, remain
liable for any shortfall below the net proceeds of such sale and
the placing proceeds of such Placing Shares and may be required to
bear any stamp duty or stamp duty reserve tax (together with any
interest, fines or penalties) due pursuant to the terms set out or
referred to in this Announcement which may arise upon the sale of
such Placee's Placing Shares on its behalf;
35.
its allocation (if any) of Placing Shares will
represent a maximum number of Placing Shares to which it will be
entitled, and required, to acquire, and that the Joint Bookrunners
or the Company may call upon it to acquire a lower number of
Placing Shares (if any), but in no event in aggregate more than the
aforementioned maximum;
36.
neither Joint Bookrunner nor any of their
Affiliates or its or their respective Representatives nor any
person acting on behalf of any of them, is making any
recommendations to it or advising it regarding the suitability or
merits of any transactions it may enter into in connection with the
Placing and participation in the Placing is on the basis that it is
not and will not be a client of either Joint Bookrunner and neither
Joint Bookrunner has any duties or responsibilities to it for
providing the protections afforded to its clients or customers or
for providing advice in relation to the Placing nor in respect of
any representations, warranties, undertakings or indemnities
contained in the Placing Agreement nor for the exercise or
performance of any of either Joint Bookrunners' rights and
obligations thereunder including any rights to waive or vary any
conditions or exercise any termination right;
37.
the exercise by either (or both) Joint Bookrunner
of any right or discretion under the Placing Agreement shall be
within the absolute discretion of the Joint Bookrunners and the
relevant Joint Bookrunner or the Joint Bookrunners (acting jointly)
(as the case may be) need not have any reference to any
Placee and shall have no liability to any Placee whatsoever in
connection with any decision to exercise or not to exercise any
such right and each Placee agrees that it has no rights against the
Joint Bookrunners, the Company or any of their respective
Affiliates under the Placing Agreement pursuant to the Contracts
(Rights of Third Parties) Act 1999 (as amended) or
otherwise;
38.
the person whom it specifies for registration as
holder of the Placing Shares will be (i) itself; or (ii) its
nominee, as the case may be. Neither Joint Bookrunner, the Company
nor any of their respective Affiliates will be responsible for any
liability to stamp duty or stamp duty reserve tax or other similar
duties or taxes (together with any interest, fines or penalties)
resulting from a failure to observe this requirement. Each Placee
and any person acting on behalf of such Placee agrees to indemnify
the Company, each Joint Bookrunner and their respective Affiliates
and its and their respective Representatives in respect of the same
on an after-tax basis on the basis that the Depositary Interests
representing the Placing Shares will be allotted to the CREST stock
account of the Settlement Bank who will hold them as nominee on
behalf of such Placee until settlement in accordance with its
standing settlement instructions;
39.
these terms and conditions and any agreements
entered into by it pursuant to these terms and conditions
(including any non-contractual obligations arising out of or in
connection with such agreements) shall be governed by and construed
in accordance with the laws of England and Wales and it submits (on
behalf of 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 any such
contract, except that enforcement proceedings in respect of the
obligation to make payment for the Placing Shares (together with
any interest chargeable thereon) may be taken by either Joint
Bookrunner or the Company 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;
40.
each of the Company, the Joint Bookrunners and
their respective Affiliates, its and their respective
Representatives and others will rely upon the truth and accuracy of
the representations, warranties, agreements, undertakings and
acknowledgements set forth herein and which are given to each Joint
Bookrunner on its own behalf and on behalf of the Company and are
irrevocable and it irrevocably authorises each Joint Bookrunner and
the Company to produce this Announcement, pursuant to, in
connection with, or as may be required by any applicable law or
regulation, administrative or legal proceeding or official inquiry
with respect to the matters set forth herein;
41.
it will indemnify on an after-tax-basis and hold
the Company, each Joint Bookrunner and their respective Affiliates
and its and their respective Representatives and any person acting
on behalf of any of them harmless from any and all costs, claims,
liabilities and expenses (including legal fees and expenses)
arising out of, directly or indirectly, or in connection with any
breach by it of the representations, warranties, acknowledgements,
agreements and undertakings in this Appendix and further agrees
that the provisions of this Appendix shall survive after completion
of the Placing;
42.
it irrevocably appoints any director or authorised
signatory of the Joint Bookrunners as its agent for the purposes of
executing and delivering to the Company and/or its registrars any
documents on its behalf necessary to enable it to be registered as
the holder of any of the Placing Shares agreed to be taken up by it
under the Placing;
43.
its commitment to acquire Placing Shares on the
terms set out herein and in any contract note 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 Bookrunners' conduct of
the Placing;
44.
in making any decision to subscribe for the
Placing Shares: (i) it has sufficient knowledge, sophistication and
experience in financial, business and international investment
matters as is required to evaluate the merits and risks of
subscribing for the Placing Shares; (ii) it is experienced in
investing in securities of a similar nature to the Common Shares
and in the sector in which the Company operates and is aware that
it may be required to bear, and is able to bear, the economic risk
of participating in, and is able to sustain a complete loss in
connection with, the Placing and has no need for liquidity with
respect to its investment in the Placing Shares; (iii) it has
relied solely on its own investigation, examination, due diligence
and analysis of the Company and their 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, and not upon
any view expressed or information provided by or on behalf of
either Joint Bookrunner; (iv) it has had sufficient time and access
to information to consider and conduct its own investigation with
respect to the offer and purchase of the Placing Shares, including
the legal, regulatory, tax, business, currency and other economic
and financial considerations relevant to such investment and has so
conducted its own investigation to the extent it deems necessary to
enable it to make an informed and intelligent decision with respect
to making an investment in the Placing Shares; (v) it is aware and
understands that an investment in the Placing Share involves a
considerable degree of risk; and (vi) it will not look to either
Joint Bookrunner, any of its Affiliates or its or their respective
Representatives or any person acting behalf of any of them for all
or part of any such loss or losses it or they may
suffer;
45.
neither the Company nor either Joint Bookrunner
owes any fiduciary or other duties to it or any Placee in respect
of any representations, warranties, undertakings or indemnities in
the Placing Agreement or these terms and conditions;
46.
in connection with the Placing, either Joint
Bookrunner and any of their Affiliates acting as an investor for
its own account may take up shares in the Company and in that
capacity may retain, purchase or sell for its own account such
shares in the Company and any securities of the Company or related
investments and may offer or sell such securities or other
investments otherwise than in connection with the Placing.
Accordingly, references in this Announcement to Placing Shares
being issued, offered or placed should be read as including any
issue, offering or placement of such shares in the Company to
either Joint Bookrunner or any of their Affiliates acting in such
capacity. In addition, either Joint Bookrunner or any of its
Affiliates may enter into financing arrangements and swaps with
investors in connection with which such Joint Bookrunner or any of
their Affiliates may from time to time acquire, hold or dispose of
such securities of the Company, including the Placing Shares.
Neither Joint Bookrunner nor any of their Affiliates intends to
disclose the extent of any such investment or transactions
otherwise than in accordance with any legal or regulatory
obligation to do so; and
47.
a communication that the Placing or the book is
"covered" (i.e. indicated demand from investors in the book equals
or exceeds the amount of the securities being offered) is not any
indication or assurance that the book will remain covered or that
the Placing and securities will be fully distributed by the Joint
Bookrunners. Each Joint Bookrunner reserves the right to take up a
portion of the securities in the Placing as a principal position at
any stage at its sole discretion, among other things, to take
account of the Company's objectives, UK MiFID II requirements
and/or its allocation policies.
The foregoing acknowledgements, confirmations,
undertakings, representations, warranties and agreements are given
for the benefit of each of the Company and each Joint Bookrunner
(for their own benefit and, where relevant, the benefit of their
respective Affiliates, Representatives and any person acting on its
or their behalf) and are irrevocable.
US
restrictions on the transfer of Common Shares
Terms used in the following
description that are defined in Regulation S of the US Securities
Act are used as defined therein.
The Common Shares have not been, and
will not be, registered under the US Securities Act or under any
securities laws of any state or other jurisdiction of the United
States. As more fully explained below, the Common Shares offered by
the Company to non-US Persons in the Placing are subject to the
conditions listed under Section 903(b)(3), or Category 3, of
Regulation S.
Under Category 3, Offering
Restrictions (as defined under Regulation S) must be in place in
connection with the Placing and additional restrictions are imposed
on resales of the Common Shares. A purchaser of Common Shares may
not offer, sell, pledge or otherwise transfer Common Shares,
directly or indirectly, in or into the United States or to, or for
the account or benefit of, any US Person, except pursuant to a
transaction meeting the requirements of Rules 901 to 905 (including
the Preliminary Notes) of Regulation S, pursuant to an effective
registration statement under the US Securities Act or pursuant to
an exemption from the registration requirements of the US
Securities Act. Hedging transactions in the Common Shares may not
be conducted, directly or indirectly, unless in compliance with the
US Securities Act and applicable US state securities laws. Once the
Common Shares are admitted to trading on AIM, Common Shares (as
represented by the Depositary Interests) held in the CREST system
will be identified with the marker "REG S" and will be segregated
into a separate trading system within CREST. The Common Shares held
in the CREST system will also bear a legend to the following
effect, unless the Company determines otherwise in compliance with
applicable law:
"THE SHARES REPRESENTED HEREBY HAVE
NOT BEEN, AND WILL NOT BE, REGISTERED UNDER THE US SECURITIES ACT
OF 1933, AS AMENDED (THE "US
SECURITIES ACT"), AND MAY NOT BE OFFERED OR SOLD IN THE
UNITED STATES OR TO, OR FOR THE ACCOUNT OR BENEFIT OF, US PERSONS
(AS DEFINED IN REGULATION S UNDER THE US SECURITIES ACT
("REGULATION S")). THE
SHARES ARE BEING OFFERED ONLY TO NON-US PERSONS OUTSIDE THE UNITED
STATES IN TRANSACTIONS EXEMPT FROM THE REGISTRATION REQUIREMENTS OF
THE US SECURITIES ACT IN RELIANCE ON REGULATION S. THE SHARES ARE
"RESTRICTED SECURITIES" AS DEFINED UNDER RULE 144 (A)(3)
PROMULGATED UNDER THE SECURITIES ACT. THE SHARES MAY NOT BE TAKEN
UP, OFFERED, SOLD, RESOLD, DELIVERED OR DISTRIBUTED, DIRECTLY OR
INDIRECTLY WITHIN, INTO OR FROM THE UNITED STATES OR TO, OR FOR THE
ACCOUNT OR BENEFIT OF, US PERSONS (AS DEFINED IN REGULATION S)
EXCEPT: (A)(I) IN AN OFFSHORE TRANSACTION MEETING THE REQUIREMENTS
OF REGULATION S, (II) PURSUANT TO AN AVAILABLE EXEMPTION FROM THE
REGISTRATION REQUIREMENTS OF THE US SECURITIES ACT, OR (III)
PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE US
SECURITIES ACT. RESALES OR REOFFERS OF SHARES MADE OFFSHORE IN
RELIANCE ON REGULATION S MAY NOT BE SOLD TO, OR FOR THE ACCOUNT OR
BENEFIT OF, ANY US PERSON (AS DEFINED IN REGULATION S) DURING THE
ONE-YEAR DISTRIBUTION COMPLIANCE PERIOD UNDER REGULATION S. HEDGING
TRANSACTIONS INVOLVING THESE SHARES MAY NOT BE CONDUCTED UNLESS IN
COMPLIANCE WITH THE US SECURITIES ACT.
BY ACCEPTING THESE SHARES, THE HOLDER
REPRESENTS AND WARRANTS THAT IT (A) IS NOT A US PERSON (AS DEFINED
IN REGULATION S) AND (B) IS NOT HOLDING THE SHARES FOR THE ACCOUNT
OR BENEFIT OF ANY US PERSON."
Certificated Common Shares will bear
a legend to the following effect, unless the Company determines
otherwise in compliance with applicable law:
"THE SHARES OF COMMON STOCK
REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE
US SECURITIES ACT OF 1933, AS AMENDED (THE "US SECURITIES ACT") OR ANY SECURITIES
ACTS OF ANY STATE OF THE UNITED STATES (THE "STATE ACTS"), AND MAY NOT BE OFFERED,
SOLD, PLEDGED OR OTHERWISE TRANSFERRED, DIRECTLY OR INDIRECTLY,
EXCEPT IF SUCH TRANSFER IS EFFECTED (1) IN A TRANSACTION MEETING
THE REQUIREMENTS OF RULES 901 THROUGH 905 (INCLUDING THE
PRELIMINARY NOTES) OF REGULATION S UNDER THE US SECURITIES ACT, (2)
PURSUANT TO AN EFFECTIVE REGISTRATION UNDER THE US SECURITIES ACT
AND ANY APPLICABLE STATE ACTS, OR (3) PURSUANT TO AN AVAILABLE
EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE US SECURITIES
ACT AND ANY APPLICABLE STATE ACTS, IN EACH CASE IN ACCORDANCE WITH
ALL APPLICABLE US SECURITIES LAWS AND IN THE CASE OF (3) AN OPINION
OF COUNSEL SHALL BE DELIVERED TO THE COMPANY (AND UPON WHICH THE
COMPANY MAY RELY) REGARDING THE AVAILABILITY OF SUCH EXEMPTION.
HEDGING TRANSACTIONS INVOLVING THE COMMON STOCK OF THE COMPANY MAY
NOT BE CONDUCTED, DIRECTLY OR INDIRECTLY, UNLESS IN COMPLIANCE WITH
THE US SECURITIES ACT. AS PROVIDED IN THE BYLAWS OF THE COMPANY,
THE COMPANY IS REQUIRED BY UNITED STATES SECURITIES LAWS TO REFUSE
TO REGISTER ANY TRANSFER OF SHARES NOT MADE IN ACCORDANCE WITH THE
ABOVE RESTRICTIONS."
Prior to the end of the one-year
Distribution Compliance Period, the holder of Common Shares
acknowledges, represents and agrees that:
1.
Any offer or sale of the Common Shares held
through CREST must be made to non-US Persons in "offshore
transactions" as defined in and pursuant to Regulation
S;
2.
No directed selling efforts (as defined in
Regulation S) may be made in the United States by, for purposes of
Rule 903 of Regulation S, the Company, a Distributor (as defined in
Regulation S), any of their respective Affiliates, or any person
acting on behalf of any of the foregoing, or, for the purposes of
Rule 904 of Regulation S, the seller, an Affiliate, or any person
acting on their behalf;
3.
Offering restrictions (as set out under section
903(b)(3)) must be implemented;
4.
Any offer or sale of certificated Common Shares
must be made to non-US Persons in "offshore transactions" as
defined in and pursuant to Regulation S, pursuant to an effective
registration statement under the US Securities Act or otherwise in
transactions exempt from registration under the US Securities
Act;
5.
The Company may refuse to register any transfer of
the Common Shares not made in accordance with the provisions of
Regulation S, pursuant to registration under the US Securities Act,
or pursuant to an available exemption from registration;
6.
Any offer or sale, if made prior to the expiration
of a one-year Distribution Compliance Period, must be made pursuant
to the following conditions:
(a)
The purchaser of the Common Shares (other than a
Distributor) must certify that it is not a US Person and is not
acquiring the Common Shares for the account or benefit of any US
Person or is a US Person who purchased Common Shares in a
transaction that did not require registration under the US
Securities Act;
(b)
The purchaser of the Common Shares must agree to
resell such Common Shares only in accordance with the provisions of
Regulation S, pursuant to registration under the US Securities Act,
or pursuant to an available exemption from registration; and must
agree not to engage in hedging transactions with regard to such
Common Shares unless in compliance with the US Securities
Act;
(c)
The Common Shares must contain the appropriate
legend, set out above;
(d)
The Company is required to refuse to register any
transfer of the Common Shares not made in accordance with the
provisions of Regulation S, pursuant to registration under the US
Securities Act, or pursuant to an available exemption from
registration; and
(e)
Each Distributor selling Common Shares to a
Distributor, a dealer (as defined in Section 2(a)(12) of the US
Securities Act), or a person receiving a selling concession, fee or
other remuneration, prior to the expiration of the one-year
Distribution Compliance Period, must send a confirmation or other
notice to the purchaser stating that the purchaser is subject to
the same restrictions on offers and sales that apply to a
Distributor;
7.
In the case of an offer or sale of Common Shares
prior to the expiration of the one-year Distribution Compliance
Period by a dealer (as defined in Section 2(a)(12) of the US
Securities Act), or a person receiving a selling concession, fee or
other remuneration in respect of the Common Shares offered or
sold:
(a)
Neither the seller nor any person acting on its
behalf may know that the offeree or buyer of the Common Shares is a
US Person; and
(b)
If the seller or any person acting on the seller's
behalf knows that the purchaser is a dealer (as defined in Section
2(a)(12) of the US Securities Act) or is a person receiving a
selling concession, fee or other remuneration in respect of the
Common Shares sold, the seller or a person acting on the seller's
behalf must send to the purchaser a confirmation or other notice
stating that the Common Shares may be offered and sold during the
one-year Distribution Compliance Period only in accordance with the
provisions of Regulation S; pursuant to registration of the
securities under the US Securities Act; or pursuant to an available
exemption from the registration requirements of the US Securities
Act; and
8.
In the case of an offer or sale of Common Shares
by an officer or director of the issuer or a Distributor, who is an
affiliate of the issuer or Distributor solely by virtue of holding
such position, no selling concession, fee or other remuneration may
be paid in connection with such offer or sale other than the usual
and customary broker's commission that would be received by a
person executing such transaction as agent.
Common Shares acquired from the
Company, a Distributor, or any of their respective affiliates in a
transaction subject to the conditions of Rule 901 or Rule 903 are
deemed to be "restricted securities" as defined in Rule 144 under
the US Securities Act. Resales of any of such restricted securities
by the offshore purchaser must be made in accordance with
Regulation S, the registration requirements of the US Securities
Act or an exemption therefrom. Any "restricted securities", as
defined in Rule 144, will continue to be deemed to be restricted
securities, notwithstanding that they were acquired in a resale
transaction made pursuant to Rule 901 or 904. Prior to the end of
the Distribution Compliance Period and prior to any transfer of
such Common Shares, each purchaser of Common Shares acquired
through CREST and in reliance on Regulation S will be required, to
represent and agree as follows, that:
(a) the
purchaser is not a US Person and is not acting for the account or
benefit of a US Person and is not located in the United States at
the time the investment decision is made with respect to the Common
Shares;
(b) the
purchaser understands that the Common Shares have not been
registered under the US Securities Act and may not be offered,
sold, pledged or otherwise transferred by such purchaser except:
(i) in an offshore transaction to non-US Persons and otherwise
meeting the requirements of Rule 901 through Rule 905 (including
Preliminary Notes) of Regulation S; (ii) pursuant to an effective
registration statement under the US Securities Act; or (iii)
pursuant to an exemption from the registration requirements of the
US Securities Act, and in each case, in accordance with all
applicable securities laws of the states of the United States and
any other applicable jurisdictions;
(c) the
purchaser understands and agrees that, if in the future it decides
to resell, pledge or otherwise transfer any Common Shares or any
beneficial interests in any Common Shares prior to the date which
is one year after the later of: (i) the date when the Common Shares
are first offered to persons (other than distributors) pursuant to
Regulation S or pursuant to another exemption from, or transaction
not subject tom registration under the US Securities Act; and (ii)
Admission, it will do so only outside the United States in an
offshore transaction to non-US Persons and otherwise in compliance
with Rule 901 to Rule 905 (including the Preliminary Notes) under
the US Securities Act, pursuant to an effective registration
statement under the US Securities Act or pursuant to an exemption
from the registration requirements of the US Securities Act and in
each of such cases in accordance with any applicable securities law
of any state of the United States;
(d) the
Company is required to refuse to register any transfer of the
Common Shares not made in accordance with the provisions of
Regulation S, pursuant to registration under the US Securities Act,
or pursuant to an available exemption from registration;
(e)
hedging transactions involving the Common Shares may not be
conducted, directly or indirectly, unless in compliance with the US
Securities Act;
(f)
the purchaser agrees to, and each subsequent holder is
required to, notify any purchaser of the Common Shares from it of
the resale restrictions referred to above, if then
applicable;
(g) the
purchaser acknowledges that, prior to any proposed transfer of
Common Shares other than pursuant to an effective registration
statement, the transferee of Common Shares will be required to
provide certifications and other documentation relating to the
non-US Person status of such transferee and that such transferee
was not located in the United States at the time the investment
decision was made with respect to the Common Shares;
(h) the
purchaser acknowledges that the Company, Joint Bookrunners and
others will rely upon the truth and accuracy of the foregoing
acknowledgements, representations and warranties and agrees that if
any such acknowledgement, representation or warranty deemed to have
been made by virtue of its purchase of Common Shares is no longer
accurate, it shall promptly notify the Company and the Joint
Bookrunners; and
(i)
the purchaser acknowledges that the Common Shares will bear a
restrictive legend to the following effect, unless the Company
determines otherwise in compliance with applicable law:
"THE SHARES OF COMMON STOCK
REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE
US SECURITIES ACT OF 1933, AS AMENDED (THE "US SECURITIES ACT") OR ANY SECURITIES
ACTS OF ANY STATE OF THE UNITED STATES (THE "STATE ACTS"), AND MAY NOT BE OFFERED,
SOLD, PLEDGED OR OTHERWISE TRANSFERRED, DIRECTLY OR INDIRECTLY,
EXCEPT IF SUCH TRANSFER IS EFFECTED (1) IN A TRANSACTION MEETING
THE REQUIREMENTS OF RULES 901 THROUGH 905 (INCLUDING THE
PRELIMINARY NOTES) OF REGULATION S UNDER THE US SECURITIES ACT, (2)
PURSUANT TO AN EFFECTIVE REGISTRATION UNDER THE US SECURITIES ACT
AND ANY APPLICABLE STATE ACTS, OR (3) PURSUANT TO AN AVAILABLE
EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE US SECURITIES
ACT AND ANY APPLICABLE STATE ACTS, IN EACH CASE IN ACCORDANCE WITH
ALL APPLICABLE US SECURITIES LAWS AND IN THE CASE OF (3) AN OPINION
OF COUNSEL SHALL BE DELIVERED TO THE COMPANY (AND UPON WHICH THE
COMPANY MAY RELY) REGARDING THE AVAILABILITY OF SUCH EXEMPTION.
HEDGING TRANSACTIONS INVOLVING THE COMMON STOCK OF THE COMPANY MAY
NOT BE CONDUCTED, DIRECTLY OR INDIRECTLY, UNLESS IN COMPLIANCE WITH
THE US SECURITIES ACT. AS PROVIDED IN THE BYLAWS OF THE COMPANY,
THE COMPANY IS REQUIRED BY UNITED STATES SECURITIES LAWS TO REFUSE
TO REGISTER ANY TRANSFER OF SHARES NOT MADE IN ACCORDANCE WITH THE
ABOVE RESTRICTIONS."
Subject to various conditions
including, among others, the availability of current information
regarding the Company, applicable holding periods and volume and
manner of sale restrictions, Rule 144 may be available for US
resales of Common Shares by affiliates of the Company. Rule 144 is
an exemption that allows the resale of restricted securities if a
number of conditions are met, including, without limitation, a
holding period, the availability of adequate current information
about the Company and compliance with trading volume restrictions.
Because the Company is not a reporting company (i.e. it does not
have a class of equity securities registered under the US Exchange
Act and does not file regular reports with the SEC) and does not
intend to become a reporting company, the Common Shares may not be
eligible for sale under Rule 144 for the foreseeable future. The
Company may impose or modify transfer restrictions and require
additional certifications and/or related documentation to evidence
compliance with applicable securities laws and regulations. Common
Shares held by "Affiliates" (as defined in Rule 405 of the US
Securities Act) of the Company shall be held in certificated form
and accordingly settlement shall not be permitted via CREST until
such time as the relevant restrictions are no longer applicable.
Affiliates of the Company at the time of the Placing, or investors
that become Affiliates at any time after the Placing, should seek
independent US legal counsel prior to selling or transferring any
Common Shares. A liquid trading market for the Common Shares does
not currently exist in the United States, and the Company does not
expect such a market to develop soon.
PRIOR TO PURCHASING ANY COMMON SHARES
OR CONDUCTING ANY TRANSACTIONS IN ANY COMMON SHARES, INVESTORS ARE
ADVISED TO CONSULT PROFESSIONAL ADVISERS REGARDING THE ABOVE
RESTRICTIONS ON TRANSFER AND OTHER RESTRICTIONS REFERRED TO IN THIS
DOCUMENT.
In this document, a "US Person" has the meaning set forth
in Regulation S and includes:
●
any natural person resident in the United
States;
●
any partnership or corporation organised or incorporated under the
laws of the United States;
●
any estate of which any executor or administrator is a US
Person;
●
any trust of which any trustee is a US Person;
●
any agency or branch of a foreign entity located in the United
States;
●
any non-discretionary account or similar account (other than an
estate or trust) held by a dealer or other fiduciary for the
benefit or account of a US Person;
●
any discretionary account or similar account (other than an estate
or trust) held by a dealer or other fiduciary organised,
incorporated or (if an individual) resident in the United States;
and
●
any partnership or corporation if it is organised or incorporated
under the laws of any foreign jurisdiction and formed by a US
Person principally for the purpose of investing in securities not
registered under the US Securities Act, unless it is organised or
incorporated and owned, by accredited investors (as defined in Rule
501(a) under the US Securities Act) who are not natural persons,
estates or trusts.
The following are not "US Persons":
●
any discretionary account or similar account (other than an estate
or trust) held for the benefit or account of a non-US Person by a
dealer or other professional fiduciary organised, incorporated, or
(if an individual) resident in the United States;
●
any estate of which any professional fiduciary acting as executor
or administrator is a US Person if an executor or administrator of
the estate who is not a US Person has sole or shared investment
discretion with respect to the assets of the estate; and the estate
is governed by foreign law;
●
any trust of which any professional fiduciary acting as trustee is
a US Person, if a trustee who is not a US Person has sole or shared
investment discretion with respect to the trust assets, and no
beneficiary of the trust (and no settlor if the trust is revocable)
is a US Person;
●
an employee benefit plan established and administered in accordance
with the law of a country other than the United States and
customary practices and documentation of such country;
●
any agency or branch of a US Person located outside the United
States if the agency or branch operates for valid business reasons;
and the agency or branch is engaged in the business of insurance or
banking and is subject to substantive insurance or banking
regulation, respectively, in the jurisdiction where located;
and
●
the International Monetary Fund, the International Bank for
Reconstruction and Development, the Inter-American Development
Bank, the Asian Development Bank, the African Development Bank, the
United Nations, and their agencies, affiliates and pension plans,
and any other similar international organisations, their agencies,
affiliates and pension plans.
Miscellaneous
The agreement to allot and issue Placing Shares
to Placees (or the persons for whom Placees are contracting as
nominee or agent) free of UK stamp duty and UK stamp duty reserve
tax relates only to their allotment and issue to Placees, or such
persons as they nominate as their agents, direct from the Company
for the Placing Shares in question. Neither the Company nor either
Joint Bookrunner will be responsible for any UK stamp duty or UK
stamp duty reserve tax (including any interest, fines and penalties
relating thereto) arising in relation to the Placing Shares in any
other circumstances.
Such agreement is subject to the
representations, warranties and further terms above and also
assumes, and is based on a warranty from each Placee, that the
Placing Shares are not being acquired in connection with
arrangements to issue depositary receipts or to issue or transfer
the Placing Shares into a clearance service. Neither the Company
nor either Joint Bookrunner is liable to bear any stamp duty or
stamp duty reserve tax or any other similar duties or taxes
(including, without limitation, other stamp, issue, securities,
transfer, registration, capital, or documentary duties or taxes)
("transfer taxes") that
arise: (i) if there are any such arrangements (or if any such
arrangements arise subsequent to the acquisition by Placees of
Placing Shares); (ii) on a sale of Placing Shares; or (iii)
otherwise than under the laws of the United Kingdom. Each Placee to
whom (or on behalf of whom, or in respect of the person for whom it
is participating in the Placing as an agent or nominee) the
allocation, allotment, issue or delivery of Placing Shares has
given rise to such transfer taxes undertakes to pay such transfer
taxes forthwith, and agrees to indemnify on an after-tax basis and
hold each Joint Bookrunner and/or the Company and their respective
Affiliates (as the case may be) harmless from any such transfer
taxes, and all interest, fines or penalties in relation to such
transfer taxes. Each Placee should, therefore, take its own advice
as to whether any such transfer tax liability arises.
In this Announcement, "after-tax basis" means
in relation to any payment made to the Company, either Joint
Bookrunner or their respective Affiliates or its or their
respective Representatives pursuant to this Announcement where the
payment (or any part thereof) is chargeable to any tax, a basis
such that the amount so payable shall be increased so as to ensure
that after taking into account any tax chargeable (or which would
be chargeable but for the availability of any relief unrelated to
the loss, damage, cost, charge, expense or liability against which
the indemnity is given on such amount (including on the increased
amount)) there shall remain a sum equal to the amount that would
otherwise have been so payable.
Each Placee, and any person acting on behalf of
each Placee, acknowledges and agrees that each Joint Bookrunner
and/or any of their Affiliates may, at their absolute discretion,
agree to become a Placee in respect of some or all of the Placing
Shares. Each Placee acknowledges and is aware that each Joint
Bookrunner is receiving a fee in connection with its role in
respect of the Placing as detailed in the Placing
Agreement.
When a Placee or person acting on behalf of the
Placee is dealing with either Joint Bookrunner any money held in an
account with such Joint Bookrunner on behalf of the Placee and/or
any person acting on behalf of the Placee will not be treated as
client money within the meaning of the 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 relevant Joint Bookrunner's money in accordance with the
client money rules and will be used by the relevant Joint
Bookrunner in the course of its own business; and the Placee will
rank only as a general creditor of that Joint
Bookrunner.
Time is of the essence as regards each Placee's
obligations under this Appendix.
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 either Joint
Bookrunner.
The rights and remedies of each Joint
Bookrunner and the Company under the terms and conditions set out
in this Appendix are in addition to any rights and remedies which
would otherwise be available to each of them and the exercise or
partial exercise of one will not prevent the exercise of
others.
Each Placee may be asked to disclose, in
writing or orally to each Joint Bookrunner: (a) if they are an
individual, their nationality; or (b) if they are a discretionary
fund manager, the jurisdiction in which the funds are managed or
owned.
The price of shares and any income expected
from them may go down as well as up and investors may not get back
the full amount invested upon disposal of the shares. Past
performance is no guide to future performance and persons needing
advice should consult an independent financial adviser.
All times and dates in this Announcement may be
subject to amendment. The Joint Bookrunners shall notify the
Placees and any person acting on behalf of the Placees of any
changes.
APPENDIX 3 -
DEFINITIONS
The following definitions apply throughout this
Announcement unless the context otherwise requires:
"Admission"
|
means admission of the New Shares to trading on
AIM becoming effective in accordance with Rule 6 of the AIM
Rules;
|
"Affiliate"
|
has the meaning given in Rule 501(b) of
Regulation D under the Securities Act or Rule 405 under the
Securities Act, as applicable and, in the case of the Company,
includes its subsidiary undertakings;
|
"AIM"
|
means the AIM Market operated by the London
Stock Exchange.
|
"AIM
Rules"
|
means the rules published by the London Stock
Exchange entitled "AIM Rules for Companies" in force from time to
time.
|
"Announcement"
|
means this announcement (including its
Appendices);
|
"Bookbuild"
|
means the bookbuilding process to be commenced
by the Joint Bookrunners immediately following release of this
Announcement to use reasonable endeavours to procure Placees for
the Placing Shares, as described in this Announcement and subject
to the terms and conditions set out in this Announcement and the
Placing Agreement;
|
"Closing
Date"
|
means the day on which the transactions effected
in connection with the New Shares will be settled;
|
"Common
Shares"
|
means shares of common stock of the Company with
a par value per share of $0.0001 per share;
|
"Company"
|
means LungLife AI, Inc of Suite 140 2545 W
Hillcrest Drive, Thousand Oaks, California, 91320, United
States;
|
"Conditions"
|
has the meaning given to it in Appendix 2 to
this Announcement;
|
"CREST"
|
means the relevant system (as defined in the
Uncertificated Securities Regulations 2001 (SI 2001 No. 3755)) in
respect of which Euroclear is the Operator (as defined in such
Regulations) in accordance with which securities may be held and
transferred in uncertificated form;
|
"CLEP"
|
Clinical Laboratory Evaluation
permit;
|
"Depositary"
|
means Link Market Services Trustees Limited of
10th Floor, Central Square, 29 Wellington Street, Leeds, LS1
4DL;
|
"Depositary
Interests" or "DIs"
|
dematerialised depositary interests representing
underlying Common Shares that can be settled electronically through
and held in CREST, as issued by the Depositary or its nominees who
hold the underlying securities on trust;
|
"EAP"
|
Early Access Program;
|
"EIS"
|
enterprise investment scheme;
|
"EIS Placing
Shares"
"EU Prospectus
Regulation"
|
means the new Common Share to be issued (as
certificated shares or as DIs) to EIS investors pursuant to the
Placing;
means Regulation (EU) 2017/1129;
|
"Euroclear"
|
means Euroclear UK & International Limited,
a company incorporated under the laws of England and
Wales;
|
"EUWA"
|
means the European Union (Withdrawal) Act
2018;
|
"Exchange
Information"
|
has the meaning given to it in Appendix 2 to
this Announcement;
|
"FCA"
|
means the UK Financial Conduct
Authority;
|
"FSMA"
|
means the Financial Services and Markets Act
2000 (as amended);
|
"Fundraising"
|
means the Placing and the
Subscription;
|
"Goodbody"
|
means Goodbody Stockbrokers UC, trading as
Goodbody;
|
"Group"
|
means the Company and its subsidiary
undertakings;
|
"IBP"
|
Investec Bank plc;
|
"IEL"
|
Investec Europe Limited;
|
"Issue
Price"
|
35 pence per New Share;
|
"Investec"
|
IBP and IEL together;
|
"Joint
Bookrunners"
|
means Investec and Goodbody together;
|
"LCD"
|
means local coverage determination;
|
"London Stock
Exchange"
|
means London Stock Exchange plc;
|
"Material
Adverse Change"
|
has the meaning given to such term in the
Placing Agreement;
|
"New
Shares"
|
means the Placing Shares and the Subscription
Shares;
|
"Order"
|
means the Financial Services and Markets Act
2000 (Financial Promotion) Order 2005;
|
"PET"
|
eans positron emission tomography;
|
"Placee"
|
means any person (including individuals, funds
or otherwise) by whom or on whose behalf a commitment to acquire
Placing Shares is given;
|
"Placing"
|
means the conditional placing of the Placing
Shares to placees pursuant to the Placing Agreement;
|
"Placing
Agreement"
|
has the meaning given to it in Appendix 2 to
this Announcement;
|
"Placing
Shares"
|
means the new Common Shares to be issued (as
certificated shares or as DIs), conditional on Admission, in
connection with the Placing;
|
"Placing
Terms"
|
has the meaning given to it in Appendix 2 to
this Announcement;
|
"PPV"
|
means positive predictive value;
|
"PRA"
|
means the UK Prudential Regulation
Authority;
|
"Qualified
Investors"
|
mean persons who are qualified investors within
the meaning of Article 2(e) of the EU Prospectus
Regulation;
|
"Regulation
S"
|
means Regulation S promulgated under the
Securities Act;
|
"Regulatory
Information Service"
|
means any of the services set out in the AIM
Rules;
|
"Relevant
Persons"
|
mean (i) Qualified Investors; (ii) UK Qualified
Investors; or (iii) persons to whom this Announcement may otherwise
be lawfully communicated;
|
"Resolutions"
|
means the resolutions of the Company's
shareholders to approve the allotment of the Placing Shares, as set
out in the notice of the Special Meeting;
|
"Representative"
|
has the meaning given to it in Appendix 2 to
this Announcement;
|
"Restricted
Territory"
|
means the United States, Australia, Canada,
Japan, Singapore, South Africa or any jurisdiction in which the
release, publication or distribution of this Announcement is
unlawful;
|
"Securities
Act"
|
means the U.S. Securities Act of 1933, as
amended;
|
"Settlement
Bank"
|
means Investec;
|
"Special
Meeting"
|
means the special meeting of the Company's
shareholders, at which the Resolutions are to be
proposed;
|
"Special
Meeting Date"
|
means 21 March 2024 or such other date(s) to
which the Special Meeting is adjourned;
|
"Subscribers"
|
means each investor who has signed and returned
a Subscription Agreement;
|
"Subscription"
|
means the conditional subscription for the
Subscription Shares at the Issue Price;
|
"Subscription
Agreement"
|
means the subscription agreements entered into
by the Subscribers and the Company today relating to the
Subscription;
|
"Subscription
Shares"
|
means the new Common Shares to be issued by the
Company pursuant to the Subscription;
|
"subsidiary" or "subsidiary undertaking"
|
each have the meaning given to that term in the
Companies Act 2006;
|
"TA"
|
means technical assessment;
|
"UK Market
Abuse Regulation"
|
means Regulation (EU) 596/2014 as it forms part
of UK domestic law by virtue of the EUWA;
|
"UK MiFID
II"
|
means EU Directive 2014/65/EU as it forms part
of UK domestic law by virtue of the EUWA;
|
"UK Prospectus
Regulation"
|
means the EU Prospectus Regulation as it forms
part of UK domestic law by virtue of the EUWA;
|
"UK Qualified
Investors"
|
mean persons who are qualified investors within
the meaning of Article 2(e) of the UK Prospectus Regulation who
are: (i) persons who fall within the definition of "investment
professional" in Article 19(5) of the Order; or (ii) persons who
fall within Article 49(2)(a) to (d) ("High net worth companies,
unincorporated associations, etc.") of the Order;
|
"uncertificated" or "in uncertificated form"
|
means in respect of a share or other security,
where that share or other security is recorded on the relevant
register of the share or security concerned as being held in
uncertificated form in CREST and title to which may be transferred
by means of CREST;
|
"United
Kingdom" or "UK"
|
means the United Kingdom of Great Britain and
Northern Ireland;
|
"United
States" or "US"
|
means the United States of America, its
territories and possessions, any state of the United States of
America, the District of Columbia and all other areas subject to
its jurisdictions and any political sub-divisions
thereof;
|
"US
person"
|
has the meaning given to it in Regulation
S
|
"VCT"
|
means a venture capital trust under Part 6 of
the Income Tax Act 2007;
|
"VCT/EIS
Placing Shares"
|
means the Placing Shares to be issued (as
certificated shares or as DIs) to VCT and EIS investors pursuant to
the Placing; and
|
"VCT Placing
Shares"
|
means the new Common Shares to be issued (as
certificated shares or as DIs) to VCT investors pursuant to the
Placing.
|
Unless otherwise indicated in this Announcement,
all references to "£",
"GBP", "pounds", "pound sterling", "sterling", "p", "penny" or "pence" are to the lawful currency of
the United Kingdom. All references to "US$", "$" or "dollars" are to the lawful currency of
the United States of America.