Remote Monitored Systems PLC Update on Fundraising & response to announcements (6557J)
December 23 2020 - 3:13AM
UK Regulatory
TIDMRMS
RNS Number : 6557J
Remote Monitored Systems PLC
23 December 2020
Certain information contained in this announcement would have
been deemed inside information for the purposes of Article 7 of
Regulation (EU) No 596/2014 until the release of this
announcement.
23 December 2020
Remote Monitored Systems plc ("RMS" or the "Company")
Update on Fundraising and response to announcements from Dr.
Cave
The board of directors of Remote Monitored Systems plc
("Board"), is pleased to provide the following update in respect of
the placing raising gross proceeds of GBP5m announced on 18
December 2020 (the "Placing"), potential additions to the Company's
board and the recent actions of Dr Cave (a substantial shareholder
in the Company and a director of P2F).
The Placing
The Board considers the Placing to be in the best interests of
shareholders and the proceeds raised will allow the Company to meet
its immediate working capital requirements and also accelerate
projects to allow it to exploit the full potential of the Company's
technologies. The Board notes concerns raised about the scale of
the fundraising and provides some further background as set out
below.
As announced on 11 December 2020, the Company identified an
imminent working capital shortfall primarily due to the delay in
the commencement of mask producing operations at its Pharm 2 Farm
Limited ("P2F") business. To ensure that the Company was
sufficiently resourced the Company took market soundings from
investors and discovered that there appeared to be significant
demand from potential investors substantially in excess of the
Company's initial requirements. Given the requirements to ensure
that the Company had resources in place in January the timing
requirements of a pre-emptive issue were not considered appropriate
in this instance.
Noting this availability of capital the Board recognized there
was an opportunity to accelerate its plans to position P2F as a
high value supplier of specialist nano materials and coatings as
well as to invest further in its two other businesses, Gyrometric
and Clouveil.
Under these plans, the Company would invest in P2F to build its
capability in specialist nano materials and coatings alongside a
wholesale marketing operation with the eventual manufacturing of
end products incorporating these specialist materials primarily
being outsourced. This would enable P2F to focus on developing a
broader range of nano products to be commercialised along these
lines. The Company has projects within its Gyrometric and Cloudveil
businesses that can also be accelerated with focussed investment.
The Board continues to evaluate and rank such opportunities and
looks to apply the Placing proceeds to the most compelling
projects.
The Board notes the concerns raised by some shareholders in
respect of the potential dilution which may result from the future
exercise of the warrants that are being issued to placees pursuant
to the Placing. The Board therefore intends to engage with placees
in order to seek to restructure the warrants with the intention of
reducing the potential dilution to existing shareholders. Further
updates in respect of the warrants are expected to be made in due
course.
As previously announced, the new shares being issued pursuant to
the Placing commenced trading on AIM earlier today.
Additions to the Company's board
Following the acquisition of P2F, the Company had recognised the
need, reflecting the increased complexity of the business, to
further strengthen the Board in order to deliver on the Company's
growth strategy and exploit fully the potential for its products.
To this end the Company had already been considering a number of
candidates for one or more new independent non-executive director
positions.
While the recent commentary in relation to the Company is
unhelpful in the Company's pursuit of high quality candidates who
can add experience and expertise to the Board, the Company looks
forward to providing further updates to shareholders on this in due
course.
Relationship with Dr. Gareth Cave
The Board has noted the concerns of some investors which it has
sought to assuage through the actions noted above.
The Board also notes the announcements issued by Dr Cave and the
ongoing social media commentary it has generated including
threatening and defamatory comments directed at the Company and its
officers. Dr. Cave has been informed by RMS that in its view he has
been in deliberate breach of the Relationship Agreement entered
into by him at the time of RMS' acquisition of P2F. The Company
reserves its rights to seek legal remedy in relation to this
matter.
Shareholders should note that Dr. Cave, an academic, is a
consultant to P2F supplied by Nottingham Trent University under
P2F's contract with the University and is required to spend only
one day per week on P2F matters as he has an employment agreement
with the University. He has also already been informed of
governance concerns he has caused through his use of social
media.
The Company is taking legal advice in respect of these matters
and intends to respond very robustly, including pursuing those
publishing defamatory information about the RMS Board and notifying
the police where appropriate.
Further announcements will be made in due course.
- ENDS -
ENQUIRIES :
Remote Monitored Systems plc
John Richardson (Executive Director) +44 7751 118916
SP Angel Corporate Finance LLP +44 20 3470 0470
Nominated Adviser and Joint Broker
Stuart Gledhill
Caroline Rowe
Peterhouse Corporate Finance +44 20 7469 0930
Joint Broker
Lucy Williams
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