TIDMRENX
RNS Number : 3211S
Renalytix AI PLC
08 July 2020
Renalytix AI plc
("RenalytixAI", the "Company")
Approval of distribution of shares in Verici Dx Limited
and
related party transaction
NEW YORK, 8 July, 2020 - Renalytix AI plc ( LSE: RENX), an
artificial intelligence-enabled in vitro diagnostics company,
focused on optimizing clinical management of kidney disease to
drive improved patient outcomes and lower healthcare costs,
announces that it now proposes to distribute shares in its
wholly-owned subsidiary, Verici Dx Limited ("Verici").
Following the approval by shareholders at a general meeting held
on 15 May 2020 of the reduction of capital and the confirmation of
the High Court in England and Wales on 9 June 2020, the
cancellation of the Company's share premium account has been
completed and the reduction of capital became effective on 6 July
2020.
On 7 July 2020 the Board convened and declared a distribution in
specie of shares in Verici to trustees on trust for the Company's
shareholders (the "Distribution"). Verici's share capital has been
re-designated into 59,416,134 A Shares of GBP0.001 each and 1
golden share of GBP0.001 (the "Golden Share"). The Golden Share
will be the only voting share in the capital of Verici and will be
retained by the Company. The Company's shareholders on the register
as at close of business on 9 July 2020 ("Relevant Renalytix
Shareholders") will receive one A Share in Verici ("Distribution
Shares") for every 1 ordinary share held in the Company. Broadway
Nominees Limited, as trustees, will act as legal holder of the
Distribution Shares and the undertaking can be accessed on the
Company's website under the investor section.
Relevant Renalytix Shareholders will become the beneficial
owners of their respective Distribution Shares when the Board
resolves to declare the Distribution, at which time an 'omnibus'
share certificate in respect of the Distribution Shares will be
issued, to be held by the trustees on behalf of the Relevant
Renalytix Shareholders for a period of:
-- 365 days following admission to trading on AIM (or another
recognised stock exchange) of all or part of the issued share
capital of Verici; or
-- if all or part of the issued share capital of Verici is not
admitted to trading on AIM (or another recognised stock exchange)
within two years of the date that the Distribution is declared, two
years from the date that the Distribution is declared, (the
"Lock-up Period").
During the Lock-up Period, Relevant Renalytix Shareholders will
not be permitted to transfer the legal or beneficial ownership of
their Distribution Shares.
The A Shares and the Golden Share will, on the earlier of the
admission to trading of Verici on AIM (or another recognised stock
exchange) and two years from the date that the Distribution is
declared, automatically convert into Ordinary Shares in Verici on
the basis of one Ordinary Share for each A Share or Golden Share
held. If Verici is admitted to trading on AIM (or another
recognised stock exchange), the Lock-up Period will continue to
apply to the converted Ordinary Shares. Upon conversion, the A
Shares will rank equally in all respects with the Golden Share (and
all other Ordinary Shares) including in respect of voting and
dividend rights.
The legal title to the Distribution Shares will be held by
Broadway Nominees Limited, as trustees, during the Lock-Up Period.
If the A Shares are converted into Ordinary Shares prior to the
expiration of the Lock-up Period, Broadway Nominees Limited will
withhold its votes in relation to any shareholder resolution of
Verici. At the end of the Lock-up Period, Broadway Nominees Limited
will execute stock transfer forms to transfer the Distribution
Shares to the Relevant Renalytix Shareholders based on a schedule
provided by the Company's registrars.
Relevant Renalytix Shareholders will receive a letter informing
them of their beneficial holdings of Distribution Shares shortly
after the declaration of the Distribution.
Following the Lock-up Period, Relevant Renalytix Shareholders
will receive individual certificates in respect of their
Distribution Shares.
On 4 May 2020 the Company transferred the in-licensed FractalDx
technology and associated assets to Verici for a consideration of
$2,000,000 ("Consideration"). The Consideration was satisfied by
the issue of convertible loan notes of Verici in favour of the
Company ("Loan Notes"). The Loan Notes are repayable (if the
Company so determines), amongst other things, on the completion of
a fundraising in Verici or 12 months from the date of the
instrument constituting the Loan Notes, unless the Company
determines to convert the Loan Notes into ordinary shares in Verici
at the time of a fundraising in Verici. The Loan Notes are secured
by a debenture over Verici in favour of the Company and no interest
shall accrue on the Loan Notes.
The anticipated timetable for the distribution is:
Record date for the Distribution close of business on 9 July
2020
RenalytixAI ordinary shares marked as ex Start of trading on 10 July
rights 2020
Transfer of shares in Verici 10 July 2020
Related party transaction
As part of RenalytixAI's preparations for a potential
dual-listing on Nasdaq, The Icahn School of Medicine at Mount Sinai
("Mount Sinai"), a substantial shareholder in the Company, has
requested that RenalytixAI enter into a registration rights
agreement pursuant to which RenalytixAI will, at its own cost and
expense, assist Mount Sinai in the registration of Mount Sinai's
ordinary shares for resale under the U.S. Securities Act of 1933,
as amended. The registration rights agreement contains customary
indemnities given by RenalytixAI in respect of any loss suffered by
Mount Sinai and certain of its associated persons (as well as the
underwriters on any underwritten follow-on offering by Mount Sinai)
arising out of any material misstatements made in or omissions from
the public filings related to the potential Nasdaq dual-listing
and/or the resale of Mount Sinai's ordinary shares. These
indemnities are of a customary nature and are uncapped.
The entry by RenalytixAI into the registration rights agreement
together with the obligations contained within it is deemed to be a
related party transaction pursuant to AIM Rule 13 as Mount Sinai is
a substantial shareholder in the Company. The directors of the
Company, excluding Erik Lium and Barbara Murphy, who are not
considered to be independent for this purpose on account of their
connection with Mount Sinai, having consulted with the Company's
nominated adviser, Stifel, consider the terms of the registration
rights agreement to be fair and reasonable insofar as the Company's
shareholders are concerned.
For further information, please contact:
Renalytix AI plc www.renalytixai.com
James McCullough, CEO Via Walbrook PR
Stifel (Nominated Adviser & Broker) Tel: 020 7710 7600
Alex Price / Nicholas Moore
N+1 Singer (Joint Broker) Tel: 020 7496 3000
Aubrey Powell / George Tzimas (Corporate
Finance)
Tom Salvesen (Corporate Broking)
Walbrook PR Limited Tel: 020 7933 8780 or renalytix@walbrookpr.com
Paul McManus / Lianne Cawthorne Mob: 07980 541 893 / 07584 391
303
About Kidney Disease
Kidney disease is now recognized as a public health epidemic
affecting over 850 million people globally. The Centers for Disease
Control and Prevention (CDC) estimates that 15% of US adults, or 37
million people, currently have chronic kidney disease (CKD).
Further, the CDC reports that 9 out of 10 adults with CKD do not
know they have it and 1 out of 2 people with very low kidney
function who are not on dialysis do not know they have CKD*. Kidney
disease is referred to as a "silent killer" because it often has no
symptoms and can go undetected until a very advanced stage. Each
year kidney disease kills more people than breast and prostate
cancer. Every day, 13 patients in the United States die while
waiting for a kidney transplant.
*
https://www.cdc.gov/kidneydisease/publications-resources/2019-national-facts.html
About RenalytixAI
RenalytixAI is a developer of artificial intelligence-enabled
clinical in vitro diagnostic solutions for kidney disease, one of
the most common and costly chronic medical conditions globally.
RenalytixAI's products are being designed to make significant
improvements in kidney disease diagnosis, transplant management,
clinical care, patient stratification for drug clinical trials, and
drug target discovery. For more information, visit
www.renalytixai.com .
Forward-Looking Statements
This press release contains forward-looking statements within
the meaning of the "safe harbor" provisions of the Private
Securities Litigation Reform Act of 1995. Forward-looking
statements are statements that are not historical facts, and in
some cases can be identified by terms such as "may," "will,"
"could," "expects," "plans, " "anticipates," and "believes." These
statements include, but are not limited to, statements regarding
the Distribution and a potential fundraising in Verici. Any
forward-looking statements are based on management's current views
and assumptions and involve risks and uncertainties that could
cause actual results, performance or events to differ materially
from those expressed or implied in such statements. All information
in this press release is as of the date of the release, and the
company undertakes no obligation to publicly update any
forward-looking statement, whether as a result of new information,
future events, or otherwise, except as required by law.
This information is provided by RNS, the news service of the
London Stock Exchange. RNS is approved by the Financial Conduct
Authority to act as a Primary Information Provider in the United
Kingdom. Terms and conditions relating to the use and distribution
of this information may apply. For further information, please
contact rns@lseg.com or visit www.rns.com.
END
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