TIDMSSTY
RNS Number : 9018I
Safestay PLC
29 November 2018
THIS ANNOUNCEMENT (INCLUDING THE APPIX) AND THE INFORMATION
CONTAINED HEREIN IS RESTRICTED AND IS NOT FOR RELEASE, PUBLICATION
OR DISTRIBUTION, IN WHOLE OR IN PART, DIRECTLY OR INDIRECTLY, IN,
INTO OR FROM THE UNITED STATES, AUSTRALIA, CANADA, JAPAN, THE
REPUBLIC OF SOUTH AFRICA, NEW ZEALAND OR ANY OTHER JURISDICTION IN
WHICH SUCH RELEASE, PUBLICATION OR DISTRIBUTION WOULD BE
UNLAWFUL.
This announcement contains inside information.
For immediate release
29 November 2018
Safestay plc
("Safestay" or the "Company")
Proposed Placing and Subscription to raise approximately GBP10
million
Open Offer to raise up to approximately GBP1 million
Safestay plc (AIM: SSTY), the owner and operator of an
international brand of contemporary hostels, is pleased to announce
that the Company is carrying out a placing and subscription to
raise approximately GBP10 million, before expenses, via a placing
of approximately 27.6 million New Ordinary Shares ("Placing
Shares") at a price of 34 pence per share (the "Placing") and a
subscription of approximately 1.8 million New Ordinary Shares
("Subscription Shares") at a price of 34 pence per share (the
"Subscription").
In addition to the proposed Placing and Subscription, the
Company intends to provide all Qualifying Shareholders with the
opportunity to subscribe for an aggregate of approximately 2.85
million New Ordinary Shares ("Open Offer Shares") at a price of 34
pence per share, to raise up to approximately GBP1 million (before
expenses), on the basis of 1 New Ordinary Share for every 12
Ordinary Shares held on the Record Date (the "Open Offer").
Shareholders subscribing for their full entitlement under the Open
Offer may also request additional Open Offer Shares through an
Excess Application Facility.
The proposed Placing, Subscription and Open Offer (together the
"Fundraising") will be subject to (amongst other things)
Shareholder approval. A General Meeting is expected to be convened
on or around 17 December 2018.The Fundraising is not being
underwritten.
The Placing will be conducted by way of an accelerated bookbuild
process which will be launched immediately following this
announcement, in accordance with the terms and conditions set out
in the Appendix to this announcement. Safeland Holdings Corporation
and Safeland plc (of which Larry Lipman is a shareholder) and
certain Directors intend to participate in the Fundraising by way
of the Subscription. Canaccord Genuity is acting as Nominated
Adviser and Broker in connection with the Fundraising.
Rationale for the Fundraise
The Fundraising is primarily to continue the implementation of
the Company's successful roll-out strategy. In particular, the
Board believes that, based on the management team's extensive
experience of developing a brand led portfolio of sites, this is an
opportune time to expand and to continue to benefit from early
mover advantage in this fragmented but growing market.
The Company intends to use the net proceeds of the Fundraising
for three primary purposes, being:
-- growth capital for existing investments;
-- the conversion and refinancing of two current sites; and
-- to fund potential opportunities in new locations to accelerate growth
The Directors believe that the Fundraising will also enable
Safestay to leverage its platform and established brand with a view
to building a self-sustaining growth position through significant
organic and acquisition opportunities.
These factors, together with the Board's belief in the strength
and future potential of the Safestay brand has meant the Company is
seeking to raise a significant amount relative to the Company's
current market capitalisation. This being the case, the Board
considers it important that Qualifying Shareholders have the
opportunity to participate in the Fundraising, and the Directors
have concluded that the Open Offer is the most suitable option
available to the Company and its Shareholders.
Current Trading
As announced on 25 September 2018 when the Company released its
interim results for the six months to 30 June 2018, the Company is
continuing its expansion and is on track to deliver double-digit
growth in revenue in 2018. On 11 October 2018, the Company
announced the acquisition of its eighth property in continental
Europe, currently operating as Hotel Opera in central Brussels, for
EUR1.6 million. On 30 October 2018, the Company announced that it
had successfully secured a 20-year lease at a well-located site in
the heart of Vienna, its ninth property in continental Europe. No
consideration was paid to enter this lease. The Group intends to
convert both the Brussels and the Vienna properties into hostels
within 3 months of their acquisition.
Since 30 June 2018, the Group has continued to perform in line
with management expectations.
The Company's cash balance at 26 November 2018 was approximately
GBP1.3 million.
Larry Lipman, Executive Chairman, commented:
"We continue to believe that Safestay is a proven and scaleable
brand. This, together with the current market environment favouring
the buyer, means the proposed Fundraising is timely and once
invested will enable us to leverage the Company's existing platform
and established brand with a view to building a self-sustaining
growth position, through significant organic and acquisition
opportunities.
As a management team we are excited by the opportunities in
front of us. The proposed new capital reflects our ambition to
evolve Safestay into a leading contemporary hostel brand offering
guests a safe and stylish experience staying in centrally located
buildings at competitive rates per night.
I am also pleased that we are offering Shareholders the
opportunity to participate in the next growth stage of the
business."
Enquiries
Safestay plc +44 (0) 20 8815 1600
Larry Lipman
Nuno Sacramento
Hervé Deligny
Canaccord Genuity Limited
(Nominated Adviser and Broker) +44 (0) 20 7523 8000
Chris Connors
Martin Davison
Michael Reynolds
Jack Haynes
Novella +44 (0) 20 3151 7008
Tim Robertson
Toby Andrews
Background to the Placing, Subscription and Open Offer, and Use
of Proceeds
Safestay's model
Safestay is an established business with a strong brand and
platform. The Company has demonstrated an ability to acquire,
convert, expand, develop and operate sites in prime European city
locations, often within short timescales.
Safestay's business model offers a flexible product that can be
adjusted and adapted to fit any building, unlike traditional hotel
developments. The Company's hostels also appeal to a broader
demographic than traditional hotel developments. These factors
contribute towards a successful cash generative business model.
The Company has experienced rapid expansion and growth in the
recent past as illustrated by the following metrics:
-- 106 per cent. compound average revenue growth ("CAGR") since
the Company's admission to trading on AIM in 2014;
-- Since 2014, the Company's portfolio has grown from 1 to 13
properties in 7 countries and is currently constituted as
follows:
o 10 hostels currently operating in 4 countries;
o 2 hotels acquired in October 2018, which are in the process of
being converted into hostels; and
o 1 hostel currently under construction with work due to
complete in 2020.
-- Hostel EBITDAR margins have increased since 2016 by 10 pts to 49 per cent.
The Directors typically evaluate opportunities against the
following target metrics (although there can be no assurance that
opportunities which are pursued will meet some or all of such
target metrics, and the Directors could pursue opportunities which
fall outside such metrics if they consider it reasonable and
appropriate so to do):
-- Situated in top touristic European destinations;
-- City centre locations;
-- In buildings ideally able to accommodate 200 beds or more;
-- 25 per cent. EBITDA (50 per cent. if the freehold is being acquired);
-- Rent/EBITDAR ratio less than 55 per cent;
-- Unleveraged target IRR of at least 15 per cent;
-- Positive Net Present Value assuming an exit in year 10.
With an efficient central platform with the ability to absorb
further growth in the coming years, the Company's experienced
management team hope to continue its ambitious roll out plan in
2019 and beyond.
Detailed Use of Funds
The Company intends to use the proceeds of the Fundraising
to:
i. finance the development of the Paris property;
ii. convert the recently acquired Brussels and Vienna sites from hotels into hostels;
iii. refinance the Brussels property; and
iv. explore potential opportunities in new locations.
The redevelopment of the Paris property, which is already under
construction, is currently expected to cost approximately GBP2.4
million and will result in a brand new hostel in an ideal location.
The property will accommodate 246 beds and will target a
non-leveraged IRR of 15%.
Refinancing the Brussels property will cost approximately GBP1.4
million and the cost of conversion is currently expected to be
approximately GBP0.2 million. The property will accommodate 196
beds, thus capitalizing on its great location, and will target a
non-leveraged IRR of 29%. .
Converting the Vienna site is currently expected to cost
approximately GBP0.1 million. This existing high-quality hotel will
accommodate 234 beds.
The Company is also exploring potential opportunities in new
locations. Examples of cities where opportunities may exist include
Rome, Milan, Florence, Venice, Berlin, Amsterdam, Copenhagen,
Warsaw, Krakow, Ljubljana, Budapest, Dubrovnik, Istanbul,
Liverpool, Glasgow, Manchester, Dublin, Athens and Tel Aviv.
Illustrative examples of acquisition opportunities which fit the
Company's stated strategy include sites in major European cities
including Athens and Venice of between 200 and 700 beds with
investment sizes (including anticipated acquisition and development
costs) ranging from GBP3 million to GBP7 million per site and
target IRRs of approximately 20%.
If Safestay were to execute opportunities such as those
mentioned in the immediately preceding paragraph, the illustrative
portfolio in 2021 would comprise 15 properties across 9 countries
with 4,215 beds. Mainland Europe would represent approximately 63%
of the Group's bed stock.
The execution of such opportunities would expand the Company's
scale and provide it with increased market share, elevating its
position as a premier operator in the European hostel arena. The
Directors believe that this would in turn lead to accelerated
self-funding growth through cash flow generation as the portfolio
scales and matures whilst enhancing operational leverage through
the dilution of central costs, driven by operational economies of
scale.
Principal terms of the Placing
The Company is proposing to issue approximately 27.6 million
Placing Shares pursuant to the Placing.
The Placing will be conducted by way of an accelerated bookbuild
process to institutional investors which will be launched
immediately following this announcement, in accordance with the
terms and conditions set out in the Appendix to this
announcement.
Pursuant to the Placing and Open Offer Agreement, Canaccord
Genuity, as agent for the Company, has agreed to use its reasonable
endeavours to procure subscribers for the Placing Shares at the
Issue Price. The Placing and Open Offer Agreement is conditional
upon, among other things, the passing, without amendment, of the
Resolutions at the General Meeting; Admission occurring by no later
than 8.00 a.m. on 18 December 2018 (or such later time and/or date
as may be agreed between the Company and Canaccord Genuity, being
no later than 5.00 p.m. on 31 December 2018); and the Placing and
Open Offer Agreement becoming unconditional in all respects (save
for the condition relating to Admission) and not having been
terminated in accordance with its terms.
The Placing and Open Offer Agreement contains customary
warranties given by the Company in favour of Canaccord Genuity in
relation to, among other things, the accuracy of the information in
the Circular and other matters relating to the Group and its
business. In addition, the Company has agreed to indemnify
Canaccord Genuity (and its affiliates) in relation to certain
liabilities which they may incur in respect of the Placing and the
Open Offer. The Company has also given certain undertakings to
Canaccord Genuity.
Canaccord Genuity has the right to terminate the Placing and
Open Offer Agreement in certain circumstances prior to Admission.
In particular, in the event of breach of the warranties or a
material adverse change or if the Placing and Open Offer Agreement
does not become unconditional.
Under the Placing and Open Offer Agreement, the Company has
agreed to pay to Canaccord Genuity a commission based on the
aggregate value of the New Ordinary Shares issued at the Issue
Price pursuant to the Fundraising and the costs and expenses of the
Fundraising together with any applicable VAT.
The Placing is not being underwritten and the Placing Shares are
not subject to clawback and are not part of the Open Offer.
Principal terms of the Subscription
The Subscription Shares are being subscribed for directly by the
Subscribers at the Issue Price.
The Subscription is not being underwritten and the Subscription
Shares are not subject to clawback and are not part of the Open
Offer.
Principal terms of the Open Offer
The Open Offer provides an opportunity for all Qualifying
Shareholders to participate in the fundraising by both subscribing
for their respective Basic Entitlements and by subscribing for
Excess Shares under the Excess Application Facility, subject to
availability.
Pursuant to the Open Offer, Qualifying Shareholders will be
given the opportunity to subscribe for 1 Open Offer Share for every
12 Ordinary Shares held on the Record Date.
The Open Offer will raise gross proceeds of up to approximately
GBP1 million, assuming full take-up.
The Issue Price represents a 9.3 per cent. discount to the
Closing Price of 38 pence per Ordinary Share on 28 November 2018,
being the latest practicable date prior to the release of this
announcement.
Directors' Participation and Related Party Transactions
The Company is pleased to confirm that all of the Directors
intend to participate in the Fundraising.
Pyrrho Investments Limited ("Pyrrho"), of which Anson Chan and
Paul Cummins are directors and Anson Chan's family trust is
shareholder, has indicated an intention to subscribe for
approximately 9,698,897 Placing Shares in the Placing. Due to the
size of Pyrrho's existing holding of 9,326,741 Ordinary Shares in
the capital of the Company, representing approximately 27.26 per
cent. of the current Issued Share Capital, this transaction is
considered to be a related party transaction pursuant to AIM Rule
13 of the AIM Rules.
Safeland Holdings Corporation and Safeland plc (together
"Safeland"), of which Larry Lipman is a shareholder, have each
indicated an intention to subscribe for approximately 294,117 and
1,176,470 Subscription Shares in the Subscription respectively. Due
to the combined size of Safeland's existing holding of 3,945,114
Ordinary Shares in the capital of the Company, representing
approximately 11.5 per cent. of the current Issued Share Capital,
this transaction is considered to be a related party transaction
pursuant to AIM Rule 13 of the AIM Rules.
Larry Lipman, in his own personal capacity, has also committed
to subscribe for approximately 149,999 Subscription Shares in the
Subscription. Due to Larry Lipman's position as Chairman of the
Company, this transaction is considered to be a related party
transaction pursuant to AIM Rule 13 of the AIM Rules.
Nuno Sacremento has committed to subscribe for approximately
29,411 Subscription Shares in the Subscription Due to Nuno
Sacremento's position as Chief Operating Officer of the Company,
this transaction is considered to be a related party transaction
pursuant to AIM Rule 13 of the AIM Rules.
Hervé Deligny has committed to subscribe for approximately
44,117 Subscription Shares in the Subscription. Due to Hervé
Deligny's position as Chief Financial Officer of the Company, this
transaction is considered to be a related party transaction
pursuant to AIM Rule 13 of the AIM Rules.
Stephen Moss has committed to subscribe for approximately
108,155 Subscription Shares in the Subscription. Due to Stephen
Moss' position as a non-executive Director of the Company, this
transaction is considered to be a related party transaction
pursuant to AIM Rule 13 of the AIM Rules.
Michael Hirst has committed to subscribe for approximately
42,975 Placing Shares in the Placing. Due to Michael Hirst's
position as a non-executive Director of the Company, this
transaction is considered to be a related party transaction
pursuant to AIM Rule 13 of the AIM Rules.
Canaccord Genuity, the Company's nominated adviser, considers
that the terms of the related party transactions described above
are fair and reasonable insofar as Shareholders are concerned.
Irrevocable undertakings
Each of Safeland plc, Larry Lipman, Stephen Moss and Michael
Hirst has given an irrevocable undertaking to the Company, in
respect of their entire beneficial holding totalling, in aggregate,
1,652,752 Ordinary Shares, representing approximately 4.83 per
cent. of the Issued Share Capital, to vote in favour of the
Resolutions.
General terms
Application will be made to the London Stock Exchange for the
New Ordinary Shares to be admitted to trading on AIM. Admission is
expected to take place, and dealings on AIM are expected to
commence, at 8.00 a.m. on 18 December 2018 (or such later time
and/or date as may be agreed between the Company and Canaccord
Genuity, being no later than 5.00 p.m. on 31 December 2018). No
temporary document of title will be issued.
The New Ordinary Shares will, following Admission, rank pari
passu in all respects with the Ordinary Shares in issue at the date
of this document and will carry the right to receive all dividends
and distributions declared, made or paid on or in respect of the
Ordinary Shares after Admission.
The Placing, Subscription and the Open Offer are conditional,
inter alia, on the passing of the Resolutions at the General
Meeting and Admission.
A circular containing, amongst other things, further details of
the Placing, Subscription and Open Offer and the notice of the
General Meeting is expected to be published by the Company shortly
after completion of the accelerated bookbuild and to be despatched
to Shareholders shortly thereafter.
Basic Entitlement
Qualifying Shareholders are invited, on and subject to the terms
and conditions of the Open Offer, to apply for any number of Open
Offer Shares (subject to the limit on the number of Excess Shares
that can be applied for using the Excess Application Facility) at
the Issue Price. Qualifying Shareholders have a Basic Entitlement
of:
1 Open Offer Share for every 12 Ordinary Shares
registered in the name of the relevant Qualifying Shareholder on
the Record Date.
Basic Entitlements under the Open Offer will be rounded down to
the nearest whole number and any fractional entitlements to Open
Offer Shares will be disregarded in calculating Basic Entitlements
and will be aggregated and made available to Qualifying
Shareholders under the Excess Application Facility.
The aggregate number of Open Offer Shares available for
subscription pursuant to the Open Offer will not exceed 2,851,595
New Ordinary Shares.
Allocations under the Open Offer
In the event that valid acceptances are not received in respect
of all of the Open Offer Shares under the Open Offer, unallocated
Open Offer Shares will be allotted to Qualifying Shareholders to
meet any valid applications under the Excess Application Facility
provided always that no Qualifying Shareholder shall be entitled to
receive in excess of such number of Open Offer Shares as would
bring their aggregate interest in the Company to more than the 29.9
per cent. Aggregate Limit.
Excess Application Facility
Subject to availability and assuming that Qualifying
Shareholders have accepted their Basic Entitlement in full, the
Excess Application Facility enables Qualifying Shareholders to
apply for any whole number of Excess Shares in addition to their
Basic Entitlement up to an amount equal to the total number of Open
Offer Shares available under the Open Offer less an amount equal to
a Qualifying Shareholder's Basic Entitlement, subject always to the
29.9 per cent. Aggregate Limit.
Qualifying Non-CREST Shareholders who wish to apply to subscribe
for more than their Basic Entitlement should complete the relevant
sections on the Application Form and should refer to paragraph
4.1(c) of Part II of this document for further information.
Qualifying CREST Shareholders will have Excess CREST Open Offer
Entitlements credited to their stock account in CREST and should
refer to paragraph 4.2(c) of Part II of this document for
information on how to apply for Excess Shares pursuant to the
Excess Application Facility.
Excess Applications may be allocated in such manner as the
Directors determine, in their absolute discretion, and no assurance
can be given that applications by Qualifying Shareholders under the
Excess Application Facility will be met in full or in part or at
all.
Application procedure under the Open Offer
Qualifying Shareholders may apply for any whole number of Open
Offer Shares subject to the limit on applications under the Excess
Application Facility referred to above. The Basic Entitlement, in
the case of Qualifying Non-CREST Shareholders, is equal to the
number of Basic Entitlements as shown in Box 3 on their Application
Form or, in the case of Qualifying CREST Shareholders, is equal to
the number of Basic Entitlements standing to the credit of their
stock account in CREST.
Qualifying Shareholders with holdings of Ordinary Shares in both
certificated and uncertificated form will be treated as having
separate holdings for the purpose of calculating their Basic
Entitlements.
Qualifying CREST Shareholders will receive a credit to their
appropriate stock accounts in CREST in respect of their Basic
Entitlement and also in respect of their Excess CREST Open Offer
Entitlement as soon as practicable after 8.00 a.m. on 3 December
2018.
Application will be made for the Basic Entitlements and Excess
CREST Open Offer Entitlements to be admitted to CREST. The Basic
Entitlements and Excess CREST Open Offer Entitlements will also be
enabled for settlement in CREST as soon as practicable after 8.00
a.m. on 3 December 2018. Applications through the CREST system may
only be made by the Qualifying Shareholder originally entitled or
by a person entitled by virtue of a bona fide market claim.
Qualifying CREST Shareholders should note that, although the
Basic Entitlements and Excess CREST Open Offer Entitlements will be
admitted to CREST and be enabled for settlement, applications in
respect of entitlements under the Open Offer may only be made by
the Qualifying Shareholder originally entitled or by a person
entitled by virtue of a bona fide market claim raised by
Euroclear's Claims Processing Unit. Qualifying Non-CREST
Shareholders should note that their Application Form is not a
negotiable document and cannot be traded.
Further information on the Open Offer and the terms and
conditions on which it is made, including the procedure for
application and payment, are set out in Part II of this document
and, where relevant, on the Application Form.
Conditionality
The Fundraising is conditional, among other things, upon the
following:
-- the passing, without amendment, of the Resolutions at the General Meeting;
-- Admission occurring by no later than 8.00 a.m. on 18 December
2018 (or such later time and/or date as may be agreed between the
Company and Canaccord Genuity, being no later than 5.00 p.m. on 31
December 2018); and
-- the Placing and Open Offer Agreement becoming unconditional
in all respects (save for the condition relating to Admission) and
not having been terminated in accordance with its terms.
If the conditions set out above are not satisfied or waived
(where capable of waiver), the Placing, Subscription and the Open
Offer will lapse; and
(a) neither the Placing Shares nor the Subscription Shares will
be issued and all monies received from investors in respect thereof
will be returned to them (at the investors' risk and without
interest) as soon as possible thereafter; and
(b) any Basic Entitlements and Excess CREST Open Offer
Entitlements admitted to CREST will, after that time and date, be
disabled and application monies under the Open Offer will be
refunded to the applicants, by cheque (at the applicant's risk) in
the case of Qualifying Non-CREST Shareholders and by way of a CREST
payment.
Expected Timetable 2018
Record Date for entitlement to participate 5.00 p.m. on 28 November
in the Open Offer
Announcement of the Placing, Subscription 29 November
and the Open Offer
Despatch of the Circular, the Form of 30 November
Proxy and, to certain Qualifying Non-CREST
Shareholders, the Application Form
Expected ex-entitlement date for the 8.00 a.m. on 30 November
Open Offer
Basic Entitlements and Excess CREST 3 December
Open Offer Entitlements credited to
CREST stock accounts of Qualifying CREST
Shareholders
Recommended latest time and date for 4.30 p.m. on 10 December
requesting withdrawal of Basic Entitlements
and Excess CREST Open Offer Entitlements
from CREST
Latest time for depositing Basic Entitlements 3.00 p.m. on 11 December
and Excess CREST Open Offer Entitlements
into CREST
Latest time and date for splitting Application 3.00 p.m. on 12 December
Forms (to satisfy
bona fide market claims only)
Latest time and date for receipt of 10.00 a.m. on 13 December
Forms of Proxy for the General Meeting
Latest time and date for receipt of 11.00 a.m. on 14 December
completed Application
Forms and payment in full under the
Open Offer or settlement
of relevant CREST instruction (as appropriate)
General Meeting 10.00 a.m. on 17 December
Result of the General Meeting and Open 17 December
Offer announced through RIS
Admission of the New Ordinary Shares 8.00 a.m. on 18 December
to trading on AIM
New Ordinary Shares in uncertificated As soon as practicable
form expected to be credited to accounts after 8.00 a.m. on 18
in CREST (uncertificated holders only) December
Expected date of despatch of definitive
share certificates for the New Ordinary W/C 31 December 2018
Shares in certificated form (certificated
holders only)
Notes:
(1) The ability to participate in the Open Offer is subject to certain
restrictions relating to Qualifying Shareholders with registered addresses
or who are located or resident in countries outside the UK (particularly
the Excluded Overseas Shareholders), details of which will be set out
in paragraph 6 of Part II of the Circular. Subject to certain exceptions,
Application Forms will not be despatched to, and Open Offer Entitlements
will not be credited to the stock accounts in CREST of, Shareholders
with registered addresses in any of the Restricted Jurisdictions.
(2) Each of the times and dates set out in the above timetable and mentioned
in this document is subject to change by the Company (with the agreement
of Canaccord Genuity), in which event details of the new times and dates
will be notified to the London Stock Exchange and the Company will make
an appropriate announcement to a Regulatory Information Service.
(3) References to times in this document are to London times unless otherwise
stated.
(4) Different deadlines and procedures for applications may apply in
certain cases. For example, if a Qualifying Shareholder holds Ordinary
Shares through a CREST member or other nominee, that person may set an
earlier date for application and payment than the dates noted above.
(5) Assumes that the Resolutions to be set out in the Notice of General
Meeting are passed.
Your attention is drawn to the Appendix to this Announcement
(which forms part of this Announcement), which sets out further
information relating to the Bookbuilding Process and the terms and
conditions of the Placing.
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.
IMPORTANT NOTICES
The distribution of this Announcement and/or the Placing and/or
the Subscription and/or the Open Offer and/or issue of the New
Ordinary Shares in certain jurisdictions may be restricted by law.
No action has been taken by the Company, Canaccord Genuity or any
of their respective affiliates, agents, directors, officers or
employees that would permit an offer of the New Ordinary Shares or
possession or distribution of this Announcement or any other
offering or publicity material relating to such New Ordinary Shares
in any jurisdiction where action for that purpose is required. Any
failure to comply with these restrictions may constitute a
violation of the securities laws of such jurisdictions. Persons
into whose possession this Announcement comes are required by the
Company and Canaccord Genuity to inform themselves about and to
observe any such restrictions.
This Announcement or any part of it does not constitute or form
part of any offer to issue or sell, or the solicitation of an offer
to acquire, purchase or subscribe for, any securities in the United
States (including its territories and possessions, any state of the
United States and the District of Columbia) (the "United States" or
the "US")), Australia, Canada, Japan, the Republic of South Africa
or New Zealand or any other jurisdiction in which the same would be
unlawful. No public offering of the New Ordinary Shares is being
made in any such jurisdiction.
All offers of the New Ordinary Shares will be made pursuant to
an exemption under the Prospectus Directive from the requirement to
produce a prospectus. In the United Kingdom, this Announcement is
being directed solely at persons in circumstances in which section
21(1) of the Financial Services and Markets Act 2000 (as amended)
does not apply.
The New Ordinary Shares have not been approved or disapproved by
the US Securities and Exchange Commission, any state securities
commission or other regulatory authority in the United States, nor
have any of the foregoing authorities passed upon or endorsed the
merits of the Placing and/or the Open Offer or the accuracy or
adequacy of this Announcement. Any representation to the contrary
is a criminal offence in the United States. The relevant clearances
have not been, nor will they be, obtained from the securities
commission of any province or territory of Canada, no prospectus
has been lodged with, or registered by, the Australian Securities
and Investments Commission or the Japanese Ministry of Finance; the
relevant clearances have not been, and will not be, obtained for
the South Africa Reserve Bank or any other applicable body in the
Republic of South Africa in relation to the New Ordinary Shares;
the relevant clearances have not been and will not be obtained for
any applicable body in New Zealand in relation to the New Ordinary
Shares and the New Ordinary 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,
the Republic of South Africa or New Zealand. Accordingly, the New
Ordinary 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 the Republic of South Africa, New Zealand or any other
jurisdiction outside the United Kingdom.
Persons (including, without limitation, nominees and trustees)
who have a contractual right or other legal obligations to forward
a copy of this Announcement should seek appropriate advice before
taking any action.
By participating in the Bookbuilding Process and the Placing,
each person who is invited to and who chooses to participate in the
Placing (a "Placee") by making an oral 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 herein and to be providing the representations,
warranties, indemnities, acknowledgements and undertakings
contained in the Appendix.
This Announcement may contain and the Company may make verbal
statements containing "forward-looking statements" with respect to
certain of the Company's plans and its current goals and
expectations relating to its future financial condition,
performance, strategic initiatives, objectives and results.
Forward-looking statements sometimes use words such as "aim",
"anticipate", "target", "expect", "estimate", "intend", "plan",
"goal", "believe", "seek", "may", "could", "outlook" or other words
of similar meaning. By their nature, all forward-looking statements
involve risk and uncertainty because they relate to future events
and circumstances which are beyond the control of the Company,
including amongst other things, United Kingdom domestic and global
economic business conditions, market-related risks such as
fluctuations in interest rates and exchange rates, the policies and
actions of governmental and regulatory authorities, the effect of
competition, inflation, deflation, the timing effect and other
uncertainties of future acquisitions or combinations within
relevant industries, the effect of tax and other legislation and
other regulations in the jurisdictions in which the Company and its
respective affiliates operate, the effect of volatility in the
equity, capital and credit markets on the Company's profitability
and ability to access capital and credit, a decline in the
Company's credit ratings; the effect of operational risks; and the
loss of key personnel. As a result, the actual future financial
condition, performance and results of the Company may differ
materially from the plans, goals and expectations set forth in any
forward-looking statements. Any forward-looking statements made in
this Announcement by or on behalf of the Company speak only as of
the date they are made. Except as required by applicable law or
regulation, the Company expressly disclaims any obligation or
undertaking to publish any updates or revisions to any
forward-looking statements contained in this Announcement to
reflect any changes in the Company's expectations with regard
thereto or any changes in events, conditions or circumstances on
which any such statement is based.
Canaccord Genuity Limited is authorised and regulated by the
Financial Conduct Authority (the "FCA") in the United Kingdom and
is acting exclusively for the Company and no one else in connection
with the Bookbuilding Process and the Placing and Open Offer, and
Canaccord Genuity will not be responsible to anyone other than the
Company for providing the protections afforded to its clients or
for providing advice in relation to the Bookbuilding Process or the
Placing and Open Offer or any other matters referred to in this
Announcement.
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 Canaccord Genuity or by any of its
affiliates or agents as to, or in relation to, the accuracy or
completeness of this Announcement or any other written or oral
information made available to or publicly available to any
interested party or its advisers, and any liability therefor is
expressly disclaimed.
No statement in this Announcement is intended to be a profit
forecast or estimate, and no statement in this Announcement should
be interpreted to mean that earnings per share of the Company for
the current or future financial years would necessarily match or
exceed the historical published earnings per share of the
Company.
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.
The New Ordinary Shares to be issued or sold pursuant to the
Placing will not be admitted to trading on any stock exchange other
than the AIM market of the London Stock Exchange.
Neither the content of the Company's website nor any website
accessible by hyperlinks on the Company's website is incorporated
in, or forms part of, this Announcement.
Information for Distributors
Solely for the purposes of the product governance requirements
contained within: (a) EU Directive 2014/65/EU on markets in
financial instruments, as amended ("MiFID II"); (b) Articles 9 and
10 of Commission Delegated Directive (EU) 2017/593 supplementing
MiFID II; and (c) local implementing measures (together, the "MiFID
II Product Governance Requirements"), and disclaiming all and any
liability, whether arising in tort, contract or otherwise, which
any "manufacturer" (for the purposes of the Product Governance
Requirements) may otherwise have with respect thereto, the New
Ordinary Shares have been subject to a product approval process,
which has determined that such securities are: (i) compatible with
an end target market of investors who meet the criteria of retail
and 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 "Target
Market Assessment").
Notwithstanding the Target Market Assessment, distributors
should note that: the price of the New Ordinary Shares may decline
and investors could lose all or part of their investment; the New
Ordinary Shares offer no guaranteed income and no capital
protection; and an investment in New Ordinary 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 Proposals. Furthermore, it is noted that, notwithstanding
the Target Market Assessment, Canaccord 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 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 New Ordinary Shares
pursuant to the Placing.
Each distributor is responsible for undertaking its own Target
Market Assessment in respect of the New Ordinary Shares and
determining appropriate distribution channels.
APPIX - TERMS AND CONDITIONS OF THE PLACING
IMPORTANT INFORMATION FOR INVITED PLACEES ONLY REGARDING THE
PLACING.
MEMBERS OF THE PUBLIC ARE NOT ELIGIBLE TO TAKE PART IN THE
PLACING. THIS ANNOUNCEMENT (INCLUDING THIS APPIX) AND THE TERMS AND
CONDITIONS SET OUT HEREIN (TOGETHER, THIS "ANNOUNCEMENT") ARE
DIRECTED ONLY AT PERSONS WHOSE ORDINARY ACTIVITIES INVOLVE THEM IN
ACQUIRING, HOLDING, MANAGING AND DISPOSING OF INVESTMENTS (AS
PRINCIPAL OR AGENT) FOR THE PURPOSES OF THEIR BUSINESS AND WHO HAVE
PROFESSIONAL EXPERIENCE IN MATTERS RELATING TO INVESTMENTS AND ARE:
(1) IF IN A MEMBER STATE OF THE EUROPEAN ECONOMIC AREA ("EEA"),
QUALIFIED INVESTORS AS DEFINED IN ARTICLE 2.1(e) OF DIRECTIVE
2003/71/EC AS AMED, INCLUDING BY THE 2010 PROSPECTUS DIRECTIVE
AMING DIRECTIVE (DIRECTIVE 2010/73/EC) AND TO THE EXTENT
IMPLEMENTED IN THE RELEVANT MEMBER STATE (THE "PROSPECTUS
DIRECTIVE"); (2) IF IN THE UNITED KINGDOM, QUALIFIED INVESTORS AND
(A) FALL WITHIN ARTICLE 19(5) OF THE FINANCIAL SERVICES AND MARKETS
ACT 2000 (FINANCIAL PROMOTION) ORDER 2005, AS AMED (THE "ORDER")
(INVESTMENT PROFESSIONALS) OR (B) ARE PERSONS WHO FALL WITHIN
ARTICLE 49(2)(a) TO (d) (HIGH NET WORTH COMPANIES, UNINCORPORATED
ASSOCIATIONS, ETC.) OF THE ORDER; OR (3) ARE PERSONS TO WHOM IT MAY
OTHERWISE BE 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 SATURN PLC.
THE NEW ORDINARY SHARES HAVE NOT BEEN AND WILL NOT BE REGISTERED
UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMED (THE
"SECURITIES ACT") OR WITH ANY SECURITIES REGULATORY AUTHORITY OF
ANY STATE OR JURISDICTION OF THE UNITED STATES, AND MAY NOT BE
OFFERED, SOLD OR TRANSFERRED, DIRECTLY OR INDIRECTLY, IN THE UNITED
STATES EXCEPT PURSUANT TO AN EXEMPTION FROM, OR IN A TRANSACTION
NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT
AND IN COMPLIANCE WITH ANY APPLICABLE SECURITIES LAWS OF ANY STATE
OR OTHER JURISDICTION OF THE UNITED STATES. THE NEW ORDINARY SHARES
ARE BEING OFFERED AND SOLD ONLY OUTSIDE THE UNITED STATES IN
"OFFSHORE TRANSACTIONS" WITHIN THE MEANING OF, AND IN ACCORDANCE
WITH, REGULATION S UNDER THE SECURITIES ACT AND OTHERWISE IN
ACCORDANCE WITH APPLICABLE LAWS. NO PUBLIC OFFERING OF THE NEW
ORDINARY SHARES IS BEING MADE IN THE UNITED STATES OR
ELSEWHERE.
THIS ANNOUNCEMENT (INCLUDING THIS APPIX) AND THE INFORMATION
CONTAINED HEREIN IS RESTRICTED AND IS NOT FOR RELEASE, PUBLICATION
OR DISTRIBUTION, IN WHOLE OR IN PART, DIRECTLY OR INDIRECTLY, IN OR
INTO OR FROM THE UNITED STATES, AUSTRALIA, CANADA, JAPAN, THE
REPUBLIC OF SOUTH AFRICA, NEW ZEALAND OR ANY OTHER JURISDICTION IN
WHICH SUCH RELEASE, PUBLICATION OR DISTRIBUTION WOULD BE
UNLAWFUL.
Each Placee should consult with its own advisers as to the
legal, tax, business and related aspects of an investment in the
Placing Shares. The price of shares in the Company and the income
from them (if any) may go down as well as up and investors may not
get back the full amount invested on disposal of their shares.
The distribution of this Announcement and/or the Placing and/or
the Open Offer and/or issue of the New Ordinary Shares in certain
jurisdictions may be restricted by law. No action has been taken by
the Company, Canaccord Genuity or any of their respective
affiliates, agents, directors, officers or employees that would
permit an offer of the New Ordinary Shares or possession or
distribution of this Announcement or any other offering or
publicity material relating to such New Ordinary Shares in any
jurisdiction where action for that purpose is required. Any failure
to comply with these restrictions may constitute a violation of the
securities laws of such jurisdictions. Persons into whose
possession this Announcement comes are required by the Company and
Canaccord Genuity to inform themselves about and to observe any
such restrictions.
This Announcement or any part of it does not constitute or form
part of any offer to issue or sell, or the solicitation of an offer
to acquire, purchase or subscribe for, any securities in the United
States (including its territories and possessions, any state of the
United States and the District of Columbia), Australia, Canada,
Japan, the Republic of South Africa or New Zealand or any other
jurisdiction in which the same would be unlawful. No public
offering of the New Ordinary Shares is being made in any such
jurisdiction.
All offers of the New Ordinary Shares will be made pursuant to
an exemption under the Prospectus Directive from the requirement to
produce a prospectus. In the United Kingdom, this Announcement is
being directed solely at persons in circumstances in which section
21(1) of the Financial Services and Markets Act 2000 (as amended)
(the "FSMA") does not apply.
The New Ordinary Shares have not been approved or disapproved by
the US Securities and Exchange Commission, any state securities
commission or other regulatory authority in the United States, nor
have any of the foregoing authorities passed upon or endorsed the
merits of the Placing or the accuracy or adequacy of this
Announcement. Any representation to the contrary is a criminal
offence in the United States. The relevant clearances have not
been, nor will they be, obtained from the securities commission of
any province or territory of Canada, no prospectus has been lodged
with, or registered by, the Australian Securities and Investments
Commission or the Japanese Ministry of Finance; the relevant
clearances have not been, and will not be, obtained for the South
Africa Reserve Bank or any other applicable body in the Republic of
South Africa in relation to the New Ordinary Shares and the New
Ordinary Shares have not been, nor will they be, registered under
or offering in compliance with the securities laws of any state,
province or territory of Australia, Canada, Japan, the Republic of
South Africa or New Zealand. Accordingly, the New Ordinary 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, the Republic of
South Africa or New Zealand or any other jurisdiction outside the
United Kingdom.
Persons (including, without limitation, nominees and trustees)
who have a contractual right or other legal obligations to forward
a copy of this Announcement should seek appropriate advice before
taking any action.
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.
By participating in the Bookbuilding Process and the Placing,
each Placee 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
herein and to be providing the representations, warranties,
indemnities, acknowledgements and undertakings contained in this
Appendix.
In particular, each such Placee represents, warrants,
undertakes, agrees and acknowledges (amongst other things)
that:
1. it is a Relevant Person and undertakes that it will acquire,
hold, manage or dispose of any Placing Shares that are allocated to
it for the purposes of its business;
2. in the case of a Relevant Person in a member state of the EEA
which has implemented the Prospectus Directive (each, a "Relevant
Member State") who acquires any Placing Shares pursuant to the
Placing:
(a) it is a Qualified Investor within the meaning of Article
2(1)(E) of the Prospectus Directive; and
(b) in the case of any Placing Shares acquired by it as a
financial intermediary, as that term is used in Article 3(2) of the
Prospectus Directive:
(i) the Placing Shares acquired by it in the Placing have not
been acquired on behalf of, nor have they been acquired with a view
to their offer or resale to, persons in any Relevant Member State
other than Qualified Investors or in circumstances in which the
prior consent of Canaccord Genuity has been given to the offer or
resale; or
(ii) where Placing Shares have been acquired by it on behalf of
persons in any Relevant Member State other than Qualified
Investors, the offer of those Placing Shares to it is not treated
under the Prospectus Directive as having been made to such persons;
and
3. it is acquiring the Placing Shares for its own account or is
acquiring the 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, indemnities,
acknowledgements, undertakings and agreements contained in this
Announcement; and
4. it understands (or if acting for the account of another
person, such person has confirmed that such person understands) the
resale and transfer restrictions set out in this Appendix; and
5. except as otherwise permitted by the Company and subject to
any available exemptions from applicable securities laws, it (and
any account referred to in paragraph 4 above) is outside the United
States acquiring the Placing Shares in offshore transactions as
defined in and in accordance with Regulation S under the Securities
Act.
The Company and Canaccord Genuity will rely on the truth and
accuracy of the foregoing representations.
No prospectus
The New Ordinary Shares are being offered to a limited number of
specifically invited persons only and will not be offered in such a
way as to require an admission document or prospectus in the UK or
in any other jurisdiction. No prospectus, admission document or
other offering document has been or will be submitted to be
approved by the FCA or submitted to the London Stock Exchange in
relation to the Placing or the Open Offer or the New Ordinary
Shares and Placees' commitments will be made solely on the basis of
the information contained in this Announcement, the announcement of
the pricing of the Placing (the "Placing Results Announcement") and
any information publicly announced through a Regulatory Information
Service (as defined in the AIM Rules for Companies (the "AIM
Rules")) by or on behalf of the Company on or prior to the date of
this Announcement (the "Publicly Available Information") and
subject to any further terms set forth in the contract note sent to
individual Placees.
Each Placee, by participating in the Placing, agrees that the
content of this Announcement is exclusively the responsibility of
the Company and confirms that it has neither received nor relied on
any information (other than the Publicly Available Information),
representation, warranty or statement made by or on behalf of
Canaccord Genuity or the Company or any other person and none of
Canaccord Genuity, the Company nor any other person acting on such
person's behalf nor any of their affiliates has or shall have any
liability for any Placee's decision to participate in the Placing
based on any other information, representation, warranty or
statement. Each Placee acknowledges and agrees that it has relied
on its own investigation of the business, financial or other
position of the Company in accepting a participation in the
Placing. Neither the Company nor Canaccord Genuity are making any
undertaking or warranty to any Placee regarding the legality of an
investment in the Placing Shares by such Placee under any legal,
investment or similar laws or regulations. Each Placee should not
consider any information in this Announcement to be legal, tax or
business advice. Each Placee should consult its own solicitor, tax
adviser and financial adviser for independent legal, tax and
financial advice regarding an investment in the Placing Shares.
Nothing in this paragraph shall exclude the liability of any person
for fraudulent misrepresentation.
Details of the Placing and Open Offer Agreement and the Placing
Shares
Canaccord Genuity has today entered into a Placing and Open
Offer Agreement (the "Placing and Open Offer Agreement") with the
Company under which, on the terms and subject to the conditions set
out in the Placing and Open Offer Agreement, Canaccord Genuity, as
agent for and on behalf of the Company, has agreed to use its
reasonable endeavours to procure Placees for the Placing
Shares.
The Placing is conditional on the Placing and Open Offer
Agreement becoming unconditional and not being terminated in
accordance with its terms. The Placing is not being
underwritten.
The Placing Shares will, when issued, be subject to the articles
of association of the Company and credited as fully paid and will
rank pari passu in all respects with the existing issued ordinary
shares of 1 penny each ("Ordinary Shares") in the capital of the
Company, including the right to receive all dividends and other
distributions declared, made or paid in respect of such Ordinary
Shares after the date of issue of the Placing Shares.
As part of the Placing, the Company has agreed that it will not
for a period of 180 days after (but including) Admission, directly
or indirectly, issue, offer, sell, lend, pledge, contract to sell
or issue, grant any option, right or warrant to purchase or
otherwise dispose of any Ordinary Shares (or any interest therein
or in respect thereof) or other securities of the Company
exchangeable for, convertible into or representing the right to
receive Ordinary Shares or any substantially similar securities or
otherwise enter into any transaction (including derivative
transaction) directly or indirectly, permanently or temporarily, to
dispose of any Ordinary Shares or undertake any other transaction
with the same economic effect as any of the foregoing or announce
an offering of Ordinary Shares or any interest therein or to
announce publicly any intention to enter into any transaction
described above. This agreement is subject to certain customary
exceptions and does not prevent the grant or exercise of options
under any of the Company's existing share incentives and share
option schemes, or following Admission the issue by the Company of
any Ordinary Shares upon the exercise of any right or option or the
conversion of a security already in existence.
Application for admission to trading
Application will be made to the London Stock Exchange for
admission of the Placing Shares to trading on AIM.
Subject to amongst other things the Resolutions being passed at
the General Meeting, it is expected that Admission will take place
on or before 8.00 a.m. on 18 December 2018 and that dealings in the
Placing Shares on AIM will commence at the same time.
Bookbuilding Process
Canaccord Genuity will today commence a bookbuilding process
(the "Bookbuilding Process") to determine demand for participation
in the Placing by Placees. This Appendix gives details of the terms
and conditions of, and the mechanics of participation in, the
Placing. No commissions will be paid to Placees or by Placees in
respect of any Placing Shares.
Canaccord Genuity and the Company shall be entitled to effect
the Placing by such alternative method to the Bookbuilding Process
as they may, in their sole discretion, determine.
Principal terms of the Bookbuilding Process and Placing
1. Canaccord Genuity is acting as nominated adviser, broker and
sole bookrunner to the Placing, as agent for and on behalf of the
Company.
2. Participation in the Placing will only be available to
persons who may lawfully be, and are, invited by Canaccord Genuity
to participate. Canaccord Genuity and any of its affiliates are
entitled to enter bids in the Bookbuilding Process.
3. The number of Placing Shares will be agreed between Canaccord
Genuity and the Company following completion of the Bookbuilding
Process and will be announced by the Company through a Regulatory
Information Service (the "Placing Results Announcement") following
the completion of the Bookbuilding Process and the entry into of
the pricing memorandum by the Company and Canaccord Genuity. The
Issue Price will be 34 pence.
4. To bid in the Bookbuilding Process, Placees should
communicate their bid by telephone to their usual sales contact at
Canaccord Genuity. Each bid should state the number of Ordinary
Shares which a Placee wishes to acquire at the Issue Price. Bids
may be scaled down by Canaccord Genuity on the basis referred to in
paragraph 9 below. Canaccord Genuity is arranging the Placing as
agent of the Company.
5. The Bookbuilding Process is expected to close no later than
5.00 p.m. on 29 November 2018 but may be closed earlier or later
subject to the agreement of Canaccord Genuity and the Company.
Canaccord Genuity may, in agreement with the Company, accept bids
that are received after the Bookbuilding Process has closed. The
Company reserves the right (upon agreement of Canaccord Genuity) to
reduce or seek to increase the amount to be raised pursuant to the
Placing, in its discretion.
6. Each Placee's allocation will be determined by Canaccord
Genuity in its discretion following consultation with the Company
and will be confirmed orally by Canaccord Genuity as soon as
practicable following the close of the Bookbuilding Process.
Canaccord Genuity's oral confirmation of an allocation will give
rise to an irrevocable, legally binding commitment by that person
(who at that point becomes a Placee), in favour of Canaccord
Genuity and the Company, under which it agrees to acquire the
number of Placing Shares allocated to it on the terms and subject
to the conditions set out in this Appendix and in accordance with
the Company's articles of association. Except with Canaccord
Genuity's consent, such commitment will not be capable of variation
or revocation at the time at which it is submitted.
7. The Company will release the Placing Results Announcement
following the close of the Bookbuilding Process detailing the
aggregate number of the Placing Shares to be issued and the Issue
Price at which such shares have been placed.
8. Each Placee's allocation and commitment will be evidenced by
a contract note issued to such Placee by Canaccord Genuity. The
terms of this Appendix will be deemed incorporated in that contract
note.
9. Subject to paragraphs 4, 5 and 6 above, Canaccord Genuity may
choose to accept bids, either in whole or in part, on the basis of
allocations determined at its discretion and may scale down any
bids for this purpose on such basis as it may determine or be
directed. Canaccord Genuity may also, notwithstanding paragraphs 4,
5 and 6 above, subject to the prior consent of the Company: (a)
allocate Placing Shares after the time of any initial allocation to
any person submitting a bid after that time; and (b) allocate
Placing Shares after the Bookbuilding Process has closed to any
person submitting a bid after that time.
10. Each Placee will have an immediate, separate, irrevocable
and binding obligation, owed to Canaccord Genuity (as agent for the
Company), to pay to it (or as it may direct) in cleared funds an
amount equal to the product of the Issue Price and the number of
Placing Shares such Placee has agreed to acquire and the Company
has agreed to allot and issue to that Placee.
11. Except as required by law or regulation, no press release or
other announcement will be made by Canaccord Genuity 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.
12. 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 acquired pursuant to the Placing will be
required to be made at the same time, on the basis explained below
under "Registration and Settlement".
13. All obligations under the Bookbuilding Process and Placing
will be subject to fulfilment or 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".
14. By participating in the Bookbuilding Process, each Placee
will agree 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.
15. To the fullest extent permissible by law, neither: (a)
Canaccord Genuity, (b) any of its affiliates, agents, directors,
officers, consultants or employees nor (c) to the extent not
contained within (a) or (b), any person connected with Canaccord
Genuity as defined in the FSMA ((b) and (c) being together
"affiliates" and individually an "affiliate" of Canaccord Genuity)
shall have any liability (including to the extent permissible by
law, any fiduciary duties) to Placees or to any other person
whether acting on behalf of a Placee or otherwise. In particular,
neither Canaccord Genuity nor any of its affiliates shall have any
liability (including, to the extent permissible by law, any
fiduciary duties) in respect of Canaccord Genuity's conduct of the
Bookbuilding Process or of such alternative method of effecting the
Placing as Canaccord Genuity and the Company may agree. Each Placee
acknowledges and agrees that the Company is responsible for the
allotment of the Placing Shares to the Placees and Canaccord
Genuity shall have no liability to the Placees for the failure of
the Company to fulfil those obligations.
Registration and Settlement
If Placees are allocated any Placing Shares in the Placing they
will be sent a contract note or electronic confirmation which will
confirm the number of Placing Shares allocated to them, the Issue
Price and the aggregate amount owed by them to Canaccord
Genuity.
Each Placee will be deemed to agree that it will do all things
necessary to ensure that delivery and payment is completed as
directed by Canaccord Genuity in accordance with either the
standing CREST or certificated settlement instructions which they
have in place with Canaccord Genuity.
Settlement of transactions in the Placing Shares (ISIN:
GB00BKT0J702) following Admission will take place within the CREST
system, subject to certain exceptions. Settlement through CREST is
expected to occur on 18 December 2018 (the "Settlement Date") in
accordance with the contract notes. Settlement will be on a
delivery versus payment basis. However, in the event of any
difficulties or delays in the admission of the Placing Shares to
CREST or the use of CREST in relation to the Placing, the Company
and Canaccord Genuity may agree that the Placing Shares should be
issued in certificated form. Canaccord Genuity reserves the right
to require settlement for the Placing Shares (or a portion
thereof), and to deliver the Placing Shares (or a portion thereof)
to Placees, by such other means as they deem necessary if delivery
or settlement to Placees is not practicable within the CREST system
or would not be consistent with regulatory requirements in a
Placee's jurisdiction.
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 2 percentage points above prevailing LIBOR as
determined by Canaccord Genuity.
Each Placee is deemed to agree that if it does not comply with
these obligations, Canaccord Genuity may sell any or all of their
Placing Shares on their behalf and retain from the proceeds, for
Canaccord Genuity's own account and benefit (as agent of the
Company), an amount equal to the aggregate amount owed by the
Placee plus any interest due. The relevant Placee will, however,
remain liable for, and shall indemnify Canaccord Genuity on demand
for, any shortfall below the Issue Price and may be required to
bear any stamp duty or stamp duty reserve tax or securities
transfer tax (together with any interest or penalties) which may
arise upon the sale of such Placing Shares on such Placee's behalf.
By communicating a bid for Placing Shares to Canaccord Genuity,
each Placee confers on Canaccord Genuity all such authorities and
powers necessary to carry out any such sale and agrees to ratify
and confirm all actions which Canaccord Genuity lawfully takes in
pursuance of such sale.
If Placing Shares are to be delivered to a custodian or
settlement agent, Placees must ensure that, upon receipt, the
conditional contract note 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 United Kingdom stamp duty or stamp duty reserve tax or
securities transfer tax. Placees will not be entitled to receive
any fee or commission in connection with the Placing.
Conditions of the Placing
The Placing is conditional upon the Placing and Open Offer
Agreement becoming unconditional and not having been terminated in
accordance with its terms.
The obligations of Canaccord Genuity under the Placing and Open
Offer Agreement are, and the Placing is, conditional upon, inter
alia:
(a) the Company and Canaccord Genuity agreeing the final number
of Placing Shares and the Issue Price and executing a pricing
agreement no later than 5.00 p.m. on the date of this Announcement
(or such later time and/or date as Canaccord Genuity may agree with
the Company);
(b) the Resolutions having been duly passed (without amendment)
at the General Meeting (or at any adjournment thereof);
(c) the Company complying with its obligations and having
satisfied all conditions under the Placing and Open Offer Agreement
to the extent that they fall to be performed on or before
Admission;
(d) the Company having received the aggregate subscription
proceeds in respect of the Subscription;
(e) the Company having allotted, subject only to Admission, the
New Ordinary Shares in accordance with the Placing and Open Offer
Agreement; and
(f) Admission having become effective at or before 8.00 a.m. on
18 December 2018 or such later time as Canaccord Genuity may agree
with the Company being not later than 31 December 2018;
(all conditions to the obligations of Canaccord Genuity included
in the Placing and Open Offer Agreement being together, the
"conditions").
If any of the conditions set out in the Placing and Open Offer
Agreement is not fulfilled or, where permitted, waived in
accordance with the Placing and Open Offer Agreement within the
stated time periods (or such later time and/or date as the Company
and Canaccord Genuity may agree not being later than 31 December
2018), or the Placing and Open Offer Agreement is terminated in
accordance with its terms, the Placing will lapse and the Placee's
rights and obligations 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 Placee is acting) in
respect thereof.
By participating in the Bookbuilding Process, each Placee agrees
that its rights and obligations cease and terminate only in the
circumstances described above and under "Termination of the
Placing" below and will not be capable of rescission or termination
by it.
Canaccord Genuity may, in its absolute discretion and upon such
terms as it thinks fit, waive fulfilment of all or any of the
conditions in the Placing and Open Offer Agreement in whole or in
part, or extend the time provided for fulfilment of one or more
conditions, save that certain conditions including the condition
relating to Admission referred to in paragraph (f) above may not be
waived or extended. Any such extension or waiver will not affect
Placees' commitments as set out in this Appendix.
Canaccord Genuity may terminate the Placing and Open Offer
Agreement in certain circumstances, details of which are set out
below.
Neither Canaccord Genuity nor any of its affiliates, agents,
directors, officers or employees nor the Company shall have any
liability to any Placee (or to any other person whether acting on
behalf of a Placee or otherwise) in respect of any decision any of
them may make as to whether or not to waive or to extend the time
and/or date for the satisfaction of any condition to the Placing
nor for any decision any of them 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 Canaccord
Genuity.
Termination of the Placing
Canaccord Genuity may, in its absolute discretion, by notice to
the Company or any director thereof, terminate the Placing and Open
Offer Agreement at any time up to Admission if in the good faith
opinion of Canaccord Genuity, inter alia:
(g) it shall come to the attention to Canaccord Genuity that any
statement contained in this Announcement or any other document or
announcement issued or published by or on behalf of the Company in
connection with the Placing has become untrue, inaccurate or
misleading in any material respect or any matter has arisen which
would, if this Announcement or such other documents were issued at
that time, constitute a material omission from this Announcement or
such other documents;
(h) any of the warranties given to it was untrue, inaccurate or
misleading when made and/or any of the warranties have ceased to be
true or accurate or has become misleading in each case by reference
to the facts and circumstances subsisting at that time;
(i) the Company has not complied or cannot comply with any of
its obligations under the Placing and Open Offer Agreement or
otherwise relating to the Placing and Admission;
(j) there has been a material adverse change; or
(k) there has been a force majeure event as set out in the Placing and Open Offer Agreement.
If the Placing and Open Offer 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 can be made by
any Placee in respect thereof.
By participating in the Bookbuilding Process, each Placee agrees
with the Company and Canaccord Genuity that the exercise by the
Company or Canaccord Genuity of any right of termination or any
other right or other discretion under the Placing and Open Offer
Agreement shall be within the absolute discretion of the Company or
Canaccord Genuity or for agreement between the Company and
Canaccord Genuity (as the case may be) and that neither the Company
nor Canaccord Genuity need make any reference to such Placee and
that none of the Company, Canaccord Genuity nor any of their
respective affiliates, agents, directors, officers or employees
shall have any liability to such Placee (or to any other person
whether acting on behalf of a Placee or otherwise) whatsoever in
connection with any such exercise.
By participating in the Placing, each Placee agrees that its
rights and obligations terminate only in the circumstances
described above and under the "Conditions of the Placing" section
above and will not be capable of rescission or termination by it
after oral confirmation by Canaccord Genuity following the close of
the Bookbuilding Process.
Representations, warranties and further terms
By submitting a bid in the Bookbuilding Process, each Placee
(and any person acting on such Placee's behalf) represents,
warrants, acknowledges, agrees and undertakes (for itself and for
any such prospective Placee) that (save where Canaccord Genuity
expressly agrees in writing to the contrary):
1. it has read and understood this Announcement in its entirety
and that its acquisition of the 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 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 Placing, the Company, the Placing
Shares or otherwise, other than the information contained in this
Announcement and the Publicly Available Information;
2. it has not received a prospectus, admission document or other
offering document in connection with the Placing and acknowledges
that no prospectus, admission document or other offering document:
(a) is required under the Prospectus Directive; and (b) has been or
will be prepared in connection with the Placing;
3. the Ordinary 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 AIM Rules, which
includes a description of the nature of the Company's business and
the Company's most recent balance sheet and profit and loss account
and that it is able to obtain or access such information without
undue difficulty, and is able to obtain access to such information
or comparable information concerning any other publicly traded
company, without undue difficulty;
4. it has made its own assessment of the Placing Shares and has
relied on its own investigation of the business, financial or other
position of the Company in accepting a participation in the Placing
and neither Canaccord Genuity nor the Company nor any of their
respective affiliates, agents, directors, officers or employees nor
any person acting on behalf of any of them has provided, and will
not provide, it with any material regarding the Placing Shares or
the Company or any other person other than the information in this
Announcement or the Publicly Available Information; nor has it
requested Canaccord Genuity, the Company, any of their respective
affiliates, agents, directors, employees or officers or any person
acting on behalf of any of them to provide it with any such
information;
5. neither Canaccord Genuity nor any person acting on behalf of
it nor any of its affiliates, agents, directors, officers or
employees has or shall have any liability for any Publicly
Available Information, or any representation relating to the
Company, provided that nothing in this paragraph excludes the
liability of any person for fraudulent misrepresentation made by
that person;
6. (a) the only information on which it is entitled to rely on
and on which it has relied in committing to subscribe for the
Placing Shares is contained in the Publicly Available Information,
such information being all that it deems necessary to make an
investment decision in respect of the Placing Shares and it has
made its own assessment of the Company, the Placing Shares and the
terms of the Placing based on Publicly Available Information; (b)
neither Canaccord Genuity, nor the Company (nor any of their
respective affiliates, agents, directors, officers and employees)
have made any representation or warranty to it, express or implied,
with respect to the Company, the Placing or the Placing Shares or
the accuracy, completeness or adequacy of the Publicly Available
Information or, if received, the Placee has not relied upon any
such information, representations, warranties or statements
(including any management presentation that may have been received
by any prospective Placee or any material prepared by the research
department of Canaccord Genuity (the views of such research
department not representing and being independent from those of the
Company and the corporate finance department of Canaccord Genuity
and not being attributable to the same)), and neither Canaccord
Genuity, nor the Company 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. Each
Placee further acknowledges and agrees that it may not place the
same degree of reliance on this Announcement as it may otherwise
place on a prospectus or admission document; (c) it has conducted
its own investigation of the Company, the Placing and the Placing
Shares, satisfied itself that the information is still current and
relied on that investigation for the purposes of its decision to
participate in the Placing; and (d) it has not relied on any
investigation that Canaccord Genuity or any person acting on its
behalf may have conducted with respect to the Company, the Placing
or the Placing Shares;
7. the content of this Announcement and the Publicly Available
Information has been prepared by and is exclusively the
responsibility of the Company and that neither Canaccord Genuity
nor any persons acting on its behalf is responsible for or has or
shall have any liability for any information, representation,
warranty or statement relating to the Company contained in this
Announcement or the Publicly Available Information nor will they be
liable for any Placee's decision to participate in the Placing
based on any information, representation, warranty or statement
contained in this Announcement, the Publicly Available Information
or otherwise. Nothing in this Appendix shall exclude any liability
of any person for fraudulent misrepresentation;
8. it is not, and at the time the Placing Shares are acquired
will not be, a resident of Australia, Canada, Japan, the Republic
of South Africa or New Zealand;
9. the Placing Shares have not been registered or otherwise
qualified, and will not be registered or otherwise qualified, for
offer and sale nor will a prospectus be cleared or approved in
respect of any of the Placing Shares under the securities laws of
the United States, or any state or other jurisdiction of the United
States, Australia, Canada, Japan, the Republic of South Africa or
New Zealand and, subject to certain exceptions, may not be offered,
sold, taken up, renounced or delivered or transferred, directly or
indirectly, within the United States, Australia, Canada, Japan, the
Republic of South Africa or New Zealand or in any country or
jurisdiction where any such action for that purpose is
required;
10. it has the funds available to pay for the Placing Shares for
which it has agreed to subscribe and acknowledges and agrees that
it will pay the total subscription amount in accordance with the
terms of this Announcement on the due time and date set out herein,
failing which the relevant Placing Shares may be placed with other
placees or sold at such price as Canaccord Genuity determines;
11. it and/or each person on whose behalf it is participating:
(a) is entitled to acquire Placing Shares pursuant to the
Placing under the laws and regulations of all relevant
jurisdictions;
(b) has fully observed such laws and regulations;
(c) has capacity and authority and is entitled to enter into and
perform its obligations as an acquirer of Placing Shares and will
honour such obligations; and
(d) has obtained all necessary consents and authorities
(including, without limitation, in the case of a person acting on
behalf of a Placee, all necessary consents and authorities to agree
to the terms set out or referred to in this Appendix) under those
laws or otherwise and complied with all necessary formalities to
enable it to enter into the transactions contemplated hereby and to
perform its obligations in relation thereto and, in particular, if
it is a pension fund or investment company it is aware of and
acknowledges it is required to comply with all applicable laws and
regulations with respect to its subscription for Placing
Shares;
12. it is not, and any person who it is acting on behalf of is
not, and at the time the Placing Shares are subscribed will not be,
a resident of, or with an address in, or subject to the laws of,
Australia, Canada, Japan, the Republic of South Africa or New
Zealand, and it acknowledges and agrees that the Placing Shares
have not been and will not be registered or otherwise qualified
under the securities legislation of Australia, Canada, Japan, the
Republic of South Africa or New Zealand and may not be offered,
sold, or acquired, directly or indirectly, within those
jurisdictions;
13. it and the beneficial owner of the Placing Shares is, and at
the time the Placing Shares are acquired will be, outside the
United States and acquiring the Placing Shares in an "offshore
transaction" as defined in, and in accordance with, Regulation S
under the Securities Act;
14. it understands that the Placing Shares have not been, and
will not be, registered under the Securities Act and may not be
offered, sold or resold in or into or from the United States except
pursuant to an effective registration under the Securities Act, or
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 no
representation is being made as to the availability of any
exemption under the Securities Act for the reoffer, resale, pledge
or transfer of the Placing Shares;
15. it (and any account for which it is purchasing) is not
acquiring the Placing Shares with a view to any offer, sale or
distribution thereof within the meaning of the Securities Act;
16. it understands that: (a) the Placing Shares are "restricted
securities" within the meaning of Rule 144(a)(3) under the
Securities Act; (b) no representation is made as to the
availability of the exemption provided by Rule 144 for resales of
Placing Shares; and (c) it will not deposit the Placing Shares in a
depositary receipt programme in the United States or for US persons
(as defined in the Securities Act);
17. it will not offer, sell, transfer, pledge or otherwise
dispose of any Placing Shares except:
(a) in an offshore transaction in accordance with Rules 903 or
904 of Regulation S under the Securities Act; or
(b) pursuant to another exemption from registration under the Securities Act, if available,
and in each case in accordance with all applicable securities
laws of the states of the United States and other
jurisdictions;
18. no representation has been made as to the availability of
the exemption provided by Rule 144, Rule 144A or any other
exemption under the Securities Act for the reoffer, resale, pledge
or transfer of the Placing Shares;
19. it will not distribute, forward, transfer or otherwise
transmit this Announcement or any part of it, or any other
presentational or other materials concerning the Placing in or into
or from the United States (including electronic copies thereof) to
any person, and it has not distributed, forwarded, transferred or
otherwise transmitted any such materials to any person;
20. none of Canaccord Genuity, its affiliates and any person
acting on behalf of any of them is making any recommendations to
it, advising it regarding the suitability of any transactions it
may enter into in connection with the Placing and that
participation in the Placing is on the basis that it is not and
will not be a client of Canaccord Genuity and that Canaccord
Genuity has no duties or responsibilities to it for providing the
protections afforded to its clients or for providing advice in
relation to the Placing nor in respect of any representations,
warranties, undertakings or indemnities contained in the Placing
and Open Offer Agreement nor for the exercise or performance of any
of its rights and obligations thereunder including any rights to
waive or vary any conditions or exercise any termination right;
21. it will make payment to Canaccord Genuity for the Placing
Shares allocated to it in accordance with the terms and conditions
of this Announcement on the due times and dates set out in this
Announcement, failing which the relevant Placing Shares may be
placed with others on such terms as Canaccord Genuity determines in
its absolute discretion without liability to the Placee and it will
remain liable for any shortfall below the net proceeds of such sale
and the placing proceeds of such Placing Shares;
22. its allocation (if any) of Placing Shares will represent a
maximum number of Placing Shares which it will be entitled, and
required, to subscribe for, and that the Company may call upon it
to subscribe for a lower number of Placing Shares (if any), but in
no event in aggregate more than the aforementioned maximum;
23. no action has been or will be taken by any of the Company,
Canaccord Genuity or any person acting on behalf of the Company or
Canaccord Genuity 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;
24. the person who it specifies for registration as holder of
the Placing Shares will be: (a) the Placee; or (b) a nominee of the
Placee, as the case may be. Neither Canaccord Genuity nor the
Company will be responsible for any liability to stamp duty or
stamp duty reserve tax resulting from a failure to observe this
requirement. Each Placee and any person acting on behalf of such
Placee agrees to acquire Placing Shares pursuant to the Placing and
agrees to indemnify the Company and Canaccord Genuity in respect of
the same on the basis that the Placing Shares will be allotted to a
CREST stock account of Canaccord Genuity or transferred to a CREST
stock account of Canaccord Genuity who will hold them as nominee on
behalf of the Placee until settlement in accordance with its
standing settlement instructions with it;
25. 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 stamp duty or stamp duty reserve tax
liability under (or at a rate determined under) any of sections 67,
70, 93 or 96 of the Finance Act 1986 (depository receipts and
clearance services) and that it is not participating in the Placing
as nominee or agent for any person or persons to whom the
allocation, allotment, issue or delivery of Placing Shares would
give rise to such a liability;
26. it and any person acting on its behalf (if within the United
Kingdom) falls within Article 19(5) and/or 49(2) of the Order and
undertakes that it will acquire, hold, manage and (if applicable)
dispose of any Placing Shares that are allocated to it for the
purposes of its business only;
27. it has not offered or sold and will not offer or sell any
Placing Shares to persons in the United Kingdom or elsewhere in the
EEA prior to the expiry of a period of six months from Admission
except to persons whose ordinary activities involve them in
acquiring, holding, managing or disposing of investments (as
principal or agent) for the purposes of their business or otherwise
in circumstances which have not resulted and which will not result
in an offer to the public in the United Kingdom within the meaning
of section 85(1) of the FSMA or an offer to the public in any other
member state of the EEA within the meaning of the Prospectus
Directive;
28. if it is within the EEA, it is a Qualified Investor as
defined in section 86(7) of the FSMA, being a person falling within
Article 2.1(e) of the Prospectus Directive;
29. it has only communicated or caused to be communicated and it
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 Placing Shares in circumstances
in which section 21(1) of the FSMA does not require approval of the
communication by an authorised person and it acknowledges and
agrees that this Announcement has not been approved by Canaccord
Genuity in its capacity as an authorised person under section 21 of
the FSMA and it may not therefore be subject to the controls which
would apply if it was made or approved as financial promotion by an
authorised person;
30. it has complied and it will comply with all applicable laws
with respect to anything done by it or on its behalf in relation to
the Placing Shares (including all relevant provisions of the FSMA
in respect of anything done in, from or otherwise involving the
United Kingdom);
31. represents and warrants that, if it is a financial
intermediary, as that term is used in Article 3(2) of the
Prospectus Directive (including any relevant implementing measure
in any member state), the Placing Shares acquired by it in the
Placing will not be acquired on a non-discretionary basis on behalf
of, nor will they be acquired with a view to their offer or resale
to, persons in a member state of the EEA which has implemented the
Prospectus Directive other than Qualified Investors, or in
circumstances in which the express prior written consent of
Canaccord Genuity has been given to the offer or resale;
32. if it has received any confidential price sensitive
information about the Company in advance of the Placing, it has
not: (a) dealt in the securities of the Company; (b) encouraged or
required another person to deal in the securities of the Company;
or (c) disclosed such information to any person, prior to the
information being made publicly available;
33. neither Canaccord Genuity, the Company nor any of their
respective affiliates, agents, directors, officers or employees nor
any person acting on behalf of Canaccord Genuity or its affiliates,
agents, directors, officers or employees is making any
recommendations to it, advising it regarding the suitability of any
transactions it may enter into in connection with the Placing nor
providing advice in relation to the Placing nor in respect of any
representations, warranties, acknowledgements, agreements,
undertakings, or indemnities contained in the Placing and Open
Offer Agreement nor the exercise or performance of any of Canaccord
Genuity's rights and obligations thereunder including any rights to
waive or vary any conditions or exercise any termination right;
34. Canaccord Genuity and its affiliates, acting as an investor
for its or their own account(s), may bid or subscribe for and/or
purchase Placing Shares and, in that capacity, may retain,
purchase, offer to sell or otherwise deal for its or their own
account(s) in the Placing Shares, any other securities of the
Company or other related investments in connection with the Placing
or otherwise. Accordingly, references in this Announcement to the
Placing Shares being offered, subscribed, acquired or otherwise
dealt with should be read as including any offer to, or
subscription, acquisition or dealing by, Canaccord Genuity and/or
any of its affiliates acting as an investor for its or their own
account(s). Neither Canaccord Genuity nor the Company intend to
disclose the extent of any such investment or transaction otherwise
than in accordance with any legal or regulatory obligation to do
so;
35. it has complied with its obligations in connection with
money laundering and terrorist financing under the Proceeds of
Crime Act 2002 (as amended), the Terrorism Act 2000 (as amended),
the Anti-Terrorism, Crime and Security Act 2001, the Terrorism Act
2006 and the Money Laundering Terrorist Financing and Transfer of
Funds (Information on the Payer) Regulations 2017 (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;
36. in order to ensure compliance with the Regulations,
Canaccord Genuity (for itself and as agent on behalf of the
Company) or the Company's registrars may, in their absolute
discretion, require verification of its identity. Pending the
provision to Canaccord Genuity or the Company's registrars, as
applicable, of evidence of identity, definitive certificates in
respect of the Placing Shares may be retained at Canaccord
Genuity's absolute discretion or, where appropriate, delivery of
the Placing Shares to it in uncertificated form may be delayed at
Canaccord Genuity's or the Company's registrars', as the case may
be, absolute discretion. If within a reasonable time after a
request for verification of identity Canaccord Genuity (for itself
and as agent on behalf of the Company) or the Company's registrars
have not received evidence satisfactory to them, either Canaccord
Genuity and/or the Company may, at its absolute discretion,
terminate its commitment in respect of the Placing, in which event
the monies payable on acceptance of allotment will, if already
paid, be returned without interest to the account of the drawee's
bank from which they were originally debited;
37. it is not a person: (a) with whom transactions are
prohibited under the Foreign Corrupt Practices Act of 1977 or any
economic sanction programmes administered by, or regulations
promulgated by, the Office of Foreign Assets Control of the U.S.
Department of the Treasury; (b) named on the Consolidated List of
Financial Sanctions Targets maintained by HM Treasury of the United
Kingdom; or (c) subject to financial sanctions imposed pursuant to
a regulation of the European Union or a regulation adopted by the
United Nations (together, the "Anti-corruption 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 Anti-corruption
Regulations and has obtained all governmental and other consents
(if any) which may be required for the purpose of, or as a
consequence of, such purchase, and it will provide promptly to
Canaccord Genuity such evidence, if any, as to the identity or
location or legal status of any person which Canaccord Genuity may
request from it in connection with the Placing (for the purpose of
complying with such regulations or ascertaining the nationality of
any person or the jurisdiction(s) to which any person is subject or
otherwise) in the form and manner requested by Canaccord Genuity on
the basis that any failure by it to do so may result in the number
of Placing Shares that are to be purchased by it or at its
direction pursuant to the Placing being reduced to such number, or
to nil, as Canaccord Genuity may decide in its sole discretion;
38. acknowledges that its commitment to acquire Placing Shares
on the terms set out in this Announcement 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 Canaccord Genuity's conduct of the
Placing;
39. it has knowledge and experience in financial, business and
international investment matters as is required to evaluate the
merits and risks of subscribing for the Placing Shares. It further
acknowledges that it is experienced in investing in securities of
this nature and is aware that it may be required to bear, and is
able to bear, the economic risk of, and is able to sustain, a
complete loss in connection with the Placing. It has relied upon
its own examination and due diligence of the Company and its
affiliates taken as a whole, and the terms of the Placing,
including the merits and risks involved;
40. it irrevocably appoints any duly authorised officer of
Canaccord Genuity as its agent for the purpose 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 for which it agrees to subscribe or
purchase upon the terms of this Announcement;
41. the Company, Canaccord Genuity and others (including each of
their respective affiliates, agents, directors, officers and
employees) will rely upon the truth and accuracy of these
representations, warranties, acknowledgements and agreements;
42. if it is acquiring the Placing Shares as a fiduciary or
agent for one or more investor accounts, it has full power and
authority to make, and does make, the foregoing representations,
warranties, acknowledgements, agreements and undertakings on behalf
of each such accounts;
43. where it is acquiring Placing Shares for one or more managed
accounts, represents and warrants that it is authorised in writing
by each managed account: (a) to acquire the Placing Shares for each
managed account; (b) to make on its behalf the representations,
warranties, acknowledgements, undertakings and agreements in this
Appendix and the Announcement of which it forms part; and (c) to
receive on its behalf any investment letter relating to the Placing
in the form provided to it by Canaccord Genuity;
44. agrees to indemnify on an after-tax basis and hold the
Company, Canaccord Genuity and their respective affiliates harmless
from any and all costs, claims, liabilities and expenses (including
legal fees and expenses) arising out of or in connection with any
breach 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;
45. time is of the essence as regards its obligations under this Appendix;
46. 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 Canaccord Genuity;
47. the Placing Shares will be issued subject to the terms and
conditions of this Appendix; and
48. the terms and conditions contained in this Appendix and all
documents into which this Appendix is incorporated by reference or
otherwise validly forms a part and/or any agreements entered into
pursuant to these terms and conditions and all agreements to
acquire shares pursuant to the Bookbuilding Process and/or the
Placing will be governed by and construed in accordance with
English law and it submits to the exclusive jurisdiction of the
English courts in relation to any claim, dispute or matter arising
out of such contract except that enforcement proceedings in respect
of the obligation to make payment for the Placing shares (together
with interest chargeable thereon) may be taken by the Company or
Canaccord Genuity 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.
By participating in the Placing, each Placee (and any person
acting on such Placee's behalf) agrees to indemnify and hold the
Company, Canaccord Genuity and each of their respective affiliates,
agents, directors, officers and employees harmless from any and all
costs, claims, liabilities and expenses (including legal fees and
expenses) arising out of or in connection with any breach of the
representations, warranties, acknowledgements, agreements and
undertakings given by the Placee (and any person acting on such
Placee's behalf) in this Appendix or incurred by Canaccord Genuity,
the Company or each of their respective affiliates, agents,
directors, officers or employees arising from the performance of
the Placee's obligations as set out in this Announcement, and
further agrees that the provisions of this Appendix shall survive
after the completion of the Placing.
The agreement to allot and issue Placing Shares to Placees (or
the persons for whom Placees are contracting as agent) free of
stamp duty and stamp duty reserve tax in the United Kingdom relates
only to their allotment and issue to Placees, or such persons as
they nominate as their agents, direct by the Company. Such
agreement assumes that the Placing Shares are not being acquired in
connection with arrangements to issue depositary receipts or to
transfer the Placing Shares into a clearance service. If there are
any such arrangements, or the settlement related to any other
dealings in the Placing Shares, stamp duty or stamp duty reserve
tax may be payable. In that event, the Placee agrees that it shall
be responsible for such stamp duty or stamp duty reserve tax and
neither the Company nor Canaccord Genuity shall be responsible for
such stamp duty or stamp duty reserve tax. If this is the case,
each Placee should seek its own advice and they should notify
Canaccord Genuity accordingly. In addition, Placees should note
that they will be liable for any capital duty, stamp duty and all
other stamp, issue, securities, transfer, registration, documentary
or other duties or taxes (including any interest, fines or
penalties relating thereto) payable outside the United Kingdom by
them or any other person on the acquisition by them of any Placing
Shares or the agreement by them to acquire any Placing Shares and
each Placee, or the Placee's nominee, in respect 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 non-United
Kingdom stamp, registration, documentary, transfer or similar taxes
or duties undertakes to pay such taxes and duties, including any
interest and penalties (if applicable), forthwith and to indemnify
on an after-tax basis and to hold harmless the Company and
Canaccord Genuity in the event that either the Company and/or
Canaccord Genuity have incurred any such liability to such taxes or
duties.
The representations, warranties, acknowledgements and
undertakings contained in this Appendix are given to Canaccord
Genuity for itself and on behalf of the Company and are irrevocable
and shall not be capable of termination in any circumstances.
Canaccord Genuity is authorised and regulated by the FCA in the
United Kingdom and is acting exclusively for the Company and no one
else in connection with the Bookbuilding Process and the Placing,
and Canaccord Genuity 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 in relation to the
Bookbuilding Process or the Placing or any other matters referred
to in this Announcement.
Each Placee and any person acting on behalf of the Placee
acknowledges that Canaccord Genuity does not owe any fiduciary or
other duties to any Placee in respect of any representations,
warranties, undertakings, acknowledgements, agreements or
indemnities in the Placing and Open Offer Agreement.
Each Placee and any person acting on behalf of the Placee
acknowledges and agrees that Canaccord Genuity may (at its absolute
discretion) satisfy its obligations to procure Placees by itself
agreeing to become a Placee in respect of some or all of the
Placing Shares or by nominating any connected or associated person
to do so.
When a Placee or any person acting on behalf of the Placee is
dealing with Canaccord Genuity, any money held in an account with
Canaccord Genuity 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 relevant rules and regulations of the FCA made
under the FSMA. Each 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 Canaccord
Genuity's money in accordance with the client money rules and will
be held by it under a banking relationship and not as trustee.
References to time in this Announcement are to London time,
unless otherwise stated.
All times and dates in this Announcement may be subject to
amendment. Placees will be notified of any changes.
No statement in this Announcement is intended to be a profit
forecast or estimate, and no statement in this Announcement should
be interpreted to mean that earnings per share of the Company for
the current or future financial years would necessarily match or
exceed the historical published earnings per share of the
Company.
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.
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 AIM market of the London Stock Exchange.
Neither the content of the Company's website nor any website
accessible by hyperlinks on the Company's website is incorporated
in, or forms part of, this Announcement.
DEFINITIONS
In this Announcement, the following expressions have the
following meanings, unless the context requires otherwise:
"Admission" the admission of the New Ordinary Shares
to trading on AIM becoming effective
in accordance with the AIM Rules
"AIM" the market of that name operated by
the London Stock Exchange
"AIM Rules" the AIM Rules for Companies as published
by the London Stock Exchange, as amended
from time to time
"Application Form" the application form to accompany the
Circular and to be used by Qualifying
Non-CREST Shareholders in connection
with the Open Offer;
"Basic Entitlement" the Open Offer Shares for which a Qualifying
Shareholder is entitled to subscribe
under the Open Offer calculated on
the basis of 1 Open Offer Share for
every 12 Ordinary Shares held by that
Qualifying Shareholder as at the Record
Date;
"Board" or "Directors" the board of directors of the Company
or any duly authorised committee thereof
"Business Day" any day (other than a Saturday or Sunday)
upon which commercial banks are open
for business in London, UK
"Canaccord Genuity" Canaccord Genuity Limited;
"Company" or "Safestay" Safestay plc, a company incorporated
and registered in England and Wales
with registered number 8866498
"Circular" the circular to be published by the
Company in connection with the Placing,
Subscription and Open Offer shortly
following the announcement of the results
of the accelerated bookbuild process,
the Subscription and the Placing
"Closing Price" the closing middle market price of
an Ordinary Share as derived from the
AIM appendix to the Daily Official
List of the London Stock Exchange
"CREST" the computerised settlement system
operated by Euroclear UK & Ireland
Limited which facilitates the transfer
of title to shares in uncertificated
form (as defined in the CREST Regulations)
"CREST Regulations" the Uncertificated Securities Regulations
2001 (SI 2001 No.3755)
"EBITDAR" earnings before interest, taxes, depreciation,
amortization, and restructuring or
rent costs; a non-GAAP tool used to
measure a company's financial performance
"Excess Applications" applications pursuant to the Excess
Application Facility;
"Excess Application Facility" the mechanism whereby a Qualifying
Shareholder, who has taken up his Basic
Entitlement in full, can apply for
Excess Shares up to an amount equal
to the total number of Open Offer Shares
available under the Open Offer less
an amount equal to a Qualifying Shareholder's
Basic Entitlement, subject always to
the 29.9 per cent. Aggregate Limit,
as will more fully be set out in the
Circular;
"Excess CREST Open Offer in respect of each Qualifying CREST
Entitlements" Shareholder who has taken up his Basic
Entitlement in full, the entitlement
to apply for Open Offer Shares in addition
to his Basic Entitlement credited to
his stock account in CREST, pursuant
to the Excess Application Facility,
which may be subject to scaling back
in accordance with the provisions to
be set out in the Circular;
"Excess Shares" Open Offer Shares which are not taken
up by Qualifying Shareholders pursuant
to their Basic Entitlement and which
are offered to Qualifying Shareholders
under the Excess Application Facility;
"Excluded Overseas Shareholders" other than as agreed by the Company
and Canaccord Genuity or as permitted
by applicable law, Shareholders who
are located or have registered addresses
in a Restricted Jurisdiction;
"Ex-Entitlement Date" 8.00 a.m. on 30 November 2018;
"FCA" the Financial Conduct Authority
"FSMA" the Financial Services and Markets
Act 2000 (as amended)
"Group" the Company and its subsidiaries and
subsidiary undertakings;
"General Meeting" the general meeting of the Company
to be convened for 10 a.m. on 17 December
2018 (or any adjournment thereof) at
which the Resolutions will be proposed
"Issue Price" 34p per New Ordinary Share
"Issued Share Capital" the issued ordinary share capital of
the Company as at 28 November 2018,
being the latest practicable date prior
to this Announcement, being 34,219,134
Ordinary Shares
"Latest Practicable Date" 5.00pm on 28 November 2018, being the
latest practicable date prior to the
publication of this document;
"London Stock Exchange" London Stock Exchange plc
"New Ordinary Shares" the Placing Shares, the Subscription
Shares and the Open Offer Shares;
"Notice of General Meeting" the notice of the General Meeting to
be set out in the Circular
"Open Offer" the conditional invitation by the Company
to Qualifying Shareholders to apply
to subscribe for Open Offer Shares
at the Issue Price on the terms and
subject to the conditions to be set
out in the Circular and in the case
of the Qualifying Non-CREST Shareholders
only, the Application Form;
"Open Offer Entitlements" an entitlement to subscribe for Open
Offer Shares, allocated to a Qualifying
Shareholder under the Open Offer (and,
for the avoidance of doubt, references
to Open Offer Entitlements include
Basic Entitlements and Excess CREST
Open Offer Entitlements);
"Open Offer Shares" the 2,851,595 new Ordinary Shares to
be offered to Qualifying Shareholders
under the Open Offer;
"Ordinary Shares" ordinary shares of 1 penny each in
the capital of the Company
"Placing" the conditional placing of the Placing
Shares, by Canaccord Genuity as agent
for and on behalf of the Company, at
the Issue Price pursuant to the terms
of the Placing and Open Offer Agreement
"Placing and Open Offer the conditional agreement dated 29
Agreement" November 2018 between the Company and
Canaccord Genuity relating to the Placing
"Placing Shares" approximately 27.6 million New Ordinary
Shares proposed to be issued pursuant
to the Placing
"Qualifying CREST Shareholders" Qualifying Shareholders whose Ordinary
Shares on the register of members of
the Company on the Record Date are
in uncertificated form;
"Qualifying Non-CREST Qualifying Shareholders whose Ordinary
Shareholders" Shares on the register of members of
the Company on the Record Date are
held in certificated form;
"Qualifying Shareholders" holders of Ordinary Shares on the register
of members of the Company at the Record
Date with the exception (subject to
certain exceptions) of Excluded Overseas
Shareholders;
"Regulatory Information a regulatory information service that
Service" or "RIS" is approved by the FCA and that is
on the list of regulatory information
providers as maintained by the FCA
"Resolutions" the resolutions to be proposed at the
General Meeting and to be set out in
the Notice of General Meeting
"Restricted Jurisdictions" each of Australia, Canada, Japan, New
Zealand, the Republic of South Africa
and the United States;
"Record Date" 5.00 p.m. on 28 November 2018
"Safeland Holdings Corporation Safeland Holdings (2008) Corporation,
a corporation incorporated in Panama,
of which Larry Lipman owns one third
"Shareholder" a holder of Ordinary Shares
"Subscribers" those persons who intend to subscribe
for Subscription Shares pursuant to
the Subscription, being Larry Lipman,
Safeland plc, Safeland Holdings Corporation,
Nuno Sacramento, Herve Deligny and
Stephen Moss
"Subscription" the conditional subscription of the
Subscription Shares by the Subscribers
"Subscription Shares" approximately 1.8 million New Ordinary
Shares proposed to be issued to Subscribers
pursuant to the Subscription
"UK" or "United Kingdom" the United Kingdom of Great Britain
and Northern Ireland
"29.9 per cent. Aggregate the restriction on the number of Open
Limit" Offer Shares that each Qualifying Shareholder
may receive under the Open Offer on
the basis that no Qualifying Shareholder
shall be entitled to receive in excess
of such number of Open Offer Shares
as would bring its aggregate interest
in the Company to more than 29.9 per
cent. of the Company's issued share
capital if such number of Open Offer
Shares are issued to such Qualifying
Shareholder.
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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