RNS Number:9788X
Turbo Power Systems Inc
07 June 2007
7th June 2007
Turbo Power Systems Inc
Issue of equity
Turbo Power Systems Inc. ("the Company" or "TPS") the innovative power
generation and conditioning equipment supplier, is today pleased to announce the
placing of 44,450,000 new Common Shares of no par value ("Placing Shares") at a
price of 9 pence per Placing Share with institutional and other investors to
raise approximately #4.0 million (approximately #3.9 million after expenses)
(the "Placing").
As announced on 15 May 2007, the Company has had an encouraging start to 2007
with further increases in production revenue reported for the first quarter and
the announcement of significant contract wins on the Chicago Transit Authority
and Toronto Transit Commission rail programmes. These and other recent contract
wins demonstrate that TPS is gaining significant sales traction in the rail and
aerospace markets, underpinned by a strong pipeline of future opportunities.
The net funds raised from the Placing will be used as follows:
- to satisfy the additional working capital requirements resulting from recent
and anticipated future contract wins;
- to invest in additional engineering capacity to fulfil existing and
anticipated development commitments; and
-to make additional investments in sales and marketing to ensure that the
necessary expertise and sales support exists to fully exploit the new
opportunities that exist in the Company's target markets.
The remainder of the new funds raised in the Placing will add further strength
to the Company's balance sheet and the Directors believe that the Company is now
fully funded according to its current forecasts.
The Placing is conditional on admission of the Placing Shares to AIM
("Admission"). Application will be made to the London Stock Exchange for the
Placing Shares to be admitted to trading on AIM and it is anticipated that
dealings in the Placing Shares will commence on 13 June 2007. The Placing Shares
have been issued credited as fully paid and will rank pari passu in all respects
with the existing Common Shares in the Company, including the right to receive
all dividends and other distributions declared or paid thereon following
Admission. The Placing Shares will represent approximately 14.0 per cent. of the
enlarged issued share capital of the Company immediately following Admission.
Commenting on the placing, Michael Hunt, Chief Executive Officer of Turbo Power
Systems, said "Since the beginning of the year we have received significant
additional interest from the investment community and are delighted to have
attracted this new institutional investment. The new funds raised will allow the
Company to meet its additional working capital requirements and further invest
in engineering and sales & marketing. This Placing combined with the move to new
premises means that we will have the production capacity and balance sheet
strength required to service our expanding OEM customer base."
Michael Hunt, CEO, and Stephen Sadler, CFO, will hold a conference call to
answer any questions from investors that were unable to attend the AGM at
3:00pm UK time (10:00am EST) today using the dial in number +44 20 8974 7900
from the UK and 1888 294 0122 from Canada. The pin code for the call from all
locations is 681981.
For further information, please contact:
Turbo Power Systems Inc Tel: +44 (0)20 8564 4460
Michael Hunt, Chief Executive
Stephen Sadler, Chief Financial Officer
Gavin Anderson & Company (PR) Tel: +44 (0)20 7554 1400
Ken Cronin
Michael Turner
KBC Peel Hunt Tel: +44 (0)20 7418 8900
Oliver Scott
Gordon Suggett
Company Website: www.turbopowersystems.com
About Turbo Power Systems
Turbo Power Systems develops innovative products for power generation and power
conditioning. The Group was established in 1993 as a spin-off from Imperial
College, London and was floated on the London stock exchange in July 2000 and
soon after obtained a secondary listing in Toronto. In July 2001, the Group
acquired Intelligent Power Systems Limited (I-Power) specialising in power
electronics.
FORWARD LOOKING STATEMENTS
This announcement may contain forward-looking statements, including, without
limitation, statements containing the words "believes", "anticipates",
"expects", and similar expressions. Such forward-looking statements involve
unknown risks, uncertainties and other factors which may cause the actual
results, financial condition, performance or achievements of the Company, or
industry results, to be materially different from any future results,
performance or achievements expressed or implied by such forward-looking
statements. Given these uncertainties, prospective investors are cautioned not
to place any undue reliance on such forward-looking statements. The Company
disclaims any obligation to update any such forward-looking statements in this
announcement to reflect future events or developments.
The Placing Shares referred to in this announcement have not been and will not
be registered under the US Securities Act and may not be offered or sold in the
United States except pursuant to an exception from, or a transaction not subject
to, the requirements of the US Securities Act. There will be no public offer of
the Placing Shares in the United Kingdom, United States of America or elsewhere.
APPENDIX 1
TERMS AND CONDITIONS OF THE PLACING
For Invited Placees only - Important Information
1. Eligible Participants
This Appendix, including the terms and conditions of the Placing set out below,
is directed only at persons who are FSMA Qualified Investors.
In this Appendix "you" or "Placee" means any person who is or becomes committed
to subscribe for Placing Shares under the Placing.
Members of the public are not eligible to take part in the Placing.
2. Overseas jurisdictions
The distribution of this announcement and the Placing and/or issue of ordinary
shares in certain other jurisdictions may be restricted by law. No action has
been taken by the Company or KBC Peel Hunt that would permit an offer of
ordinary shares or possession or distribution of this announcement or any other
offering or publicity material relating to such ordinary shares in any
jurisdiction where action for that purpose is required. FSMA Qualified Investors
who seek to participate in the Placing must inform themselves about and observe
any such restrictions. In particular, this announcement does not constitute an
offer to sell or issue or the solicitation of an offer to buy or subscribe for
ordinary shares in the capital of the Company in the United States, Canada,
Japan or Australia or in any other jurisdiction in which such offer or
solicitation is or would be unlawful. The Placing Shares have not been and will
not be registered under the US Securities Act or under the securities laws of
any State or other jurisdiction of the United States, and, subject to certain
exceptions, may not be offered or sold, resold or delivered, directly or
indirectly in or into the United States, or to, or for the account or benefit
of, any US persons (as defined in Regulation S under the US Securities Act). No
public offering of the Placing Shares is being made in the United States. No
money, securities or other consideration from any person inside the United
States is being solicited pursuant to this announcement or the Placing.
3. Placing
This Appendix gives details of the terms and conditions of, and the mechanics of
participation in, the Placing.
KBC Peel Hunt will arrange the Placing as agent for and on behalf of the
Company. KBC Peel Hunt will determine in its absolute discretion the extent of
each Placee's participation in the Placing, which will not necessarily be the
same for each Placee. No commissions will be paid to or by Placees in respect of
their agreement to subscribe for any Placing Shares.
Each Placee will be required to pay to KBC Peel Hunt, on the Company's behalf,
the Placing Price as the subscription sum for each Placing Share agreed to be
subscribed by it under the Placing in accordance with the terms set out in this
Appendix. Each Placee's obligation to subscribe and pay for Placing Shares under
the Placing will be owed to each of the Company and KBC Peel Hunt. Each Placee
will be deemed to have read this announcement in its entirety. To the fullest
extent permitted by law and applicable FSA rules, neither KBC Peel Hunt nor any
other KBC Person shall have any liability to Placees or to any person other than
the Company in respect of the Placing.
4. Participation and settlement
Participation in the Placing is only available to persons who are invited to
participate in it by KBC Peel Hunt.
A Placee's commitment to subscribe for a fixed number of Placing Shares under
the Placing will be agreed orally with KBC Peel Hunt. Such agreement will
constitute a legally binding commitment on your part to subscribe for that
number of Placing Shares at the Placing Price on the terms and conditions set
out or referred to in this Appendix and subject to the Company's memorandum and
articles of association. After such agreement is entered into a written
confirmation will be dispatched to you by KBC Peel Hunt confirming the number of
Placing Shares that you have agreed to subscribe, the aggregate amount you will
be required to pay for those Placing Shares and settlement instructions. It is
expected that such written confirmations will be despatched on the date of this
announcement, that the "trade date" for settlement purposes will be 12 June 2007
and the "settlement date" will be 13 June 2007.
A settlement instruction form will accompany each written confirmation and, on
receipt, should be completed and returned to Jamie Reynolds at KBC Peel Hunt by
fax on 020 7972 0112 by 3.00 p.m. on 8 June 2007.
Settlement of transactions in the Placing Shares (ISIN: CA8999101030) will take
place within the CREST system, subject to certain exceptions, on a "delivery
versus payment" (or "DVP") basis. You should settle against CREST ID: 546. KBC
Peel Hunt reserves the right to require settlement for and delivery of any
Placing Shares to any Placees by such other means that it deems appropriate if
delivery or settlement is not possible or practicable within the CREST system
within the timetable set out in this announcement or would not be consistent
with the regulatory requirements in any Placee's jurisdiction.
If Placing Shares are to be delivered to a custodian or settlement agent, please
ensure that the written confirmation is copied and delivered immediately to the
appropriate person within that organisation.
5. No Prospectus
No prospectus has been or will be submitted for approval by the FSA in relation
to the Placing or the Placing Shares. Placees' commitments in respect of Placing
Shares will be made solely on the basis of the information contained in this
announcement and on the terms contained in it.
6. Placing Shares
The Placing Shares will, when issued, be credited as fully paid and will rank
pari passu in all respects with the existing issued ordinary shares.
Application will be made for the admission of the Placing Shares to trading on
AIM. It is expected that Admission will take place, and dealings in the Placing
Shares will commence, on 13 June 2007.
7. Placing Agreement
KBC Peel Hunt has today entered into the Placing Agreement with the Company
under which KBC Peel Hunt has, on the terms and subject to the conditions set
out in the Placing Agreement, agreed to use its reasonable endeavours as agent
of the Company to procure subscribers for Placing Shares at the Placing Price.
8. Placing conditions
The Placing is conditional, inter alia, on (a) the Placing Agreement not being
terminated in accordance with its terms, (b) Admission taking place not later
than 8.00 a.m. on 13 June 2007, and (c) the Placing Agreement becoming
unconditional in all other respects.
KBC Peel Hunt reserves the right (with the agreement of the Company) to waive or
extend the time and or date for the fulfilment of any of the conditions in the
Placing Agreement to a time no later than 8.00 am on 20 June 2007 ("the Long
Stop Date").
If any condition in the Placing Agreement is not fulfilled or waived by KBC Peel
Hunt by the relevant time, the Placing will lapse and your rights and
obligations pursuant to the Placing shall cease and terminate at such time.
The Placing Agreement may be terminated by KBC Peel Hunt at any time prior to
Admission in certain circumstances including, inter alia, following a material
breach of the Placing Agreement by the Company or the occurrence of certain
force majeure events. The exercise of any right of termination pursuant to the
Placing Agreement, any waiver of any condition in the Placing Agreement and any
decision by KBC Peel Hunt whether or not to extend the time for satisfaction of
any condition in the Placing Agreement or otherwise in respect of the Placing
shall be within KBC Peel Hunt's absolute discretion. KBC Peel Hunt shall have no
liability to you in the event of any such termination, waiver or extension or in
respect of any decision whether to exercise any such right of termination,
waiver or extension.
9. Payment default
Your entitlement to receive any Placing Shares will be conditional on KBC Peel
Hunt's receipt of payment by the relevant time to be stated in the written
confirmation referred to above, or by such later time and date as KBC Peel Hunt
may in its absolute discretion determine. KBC Peel Hunt may, in its absolute
discretion, waive such condition, and shall not be liable to you in the event of
it deciding whether to waive or not to waive such condition.
If you fail to make such payment by the required time for any Placing Shares (1)
the Company may release itself (if it decides, at its absolute discretion, to do
so) and will be released from all obligations it may have to allot and/or issue
any such Placing Shares to you or at your direction which are then unallotted
and/or unissued, (2) the Company may exercise all rights of lien, forfeiture and
set-off over and in respect of any such Placing Shares to the fullest extent
permitted under its articles of association or otherwise by law and to the
extent that you then have any interest in or rights in respect of any such
shares, (3) the Company or, as applicable, KBC Peel Hunt may sell (and each of
them is irrevocably authorised by you to do so) all or any of such shares on
your behalf and then retain from the proceeds, for the account and benefit of
the Company or, where applicable, KBC Peel Hunt (i) any amount up to the total
amount due to it as, or in respect of, subscription monies, or as interest on
such monies, for any Placing Shares, (i) any amount required to cover any stamp
duty or stamp duty reserve tax arising on the sale, and (iii) any amount
required to cover dealing costs and/or commissions necessarily or reasonably
incurred by it in respect of such sale, and (4) you shall remain liable to the
Company and to KBC Peel Hunt for any loss which it may suffer as a result of it
(i) not receiving payment in full for such Placing Shares by the required time,
and/or (ii) the sale of any such Placing Shares to any other person at whatever
price and on whatever terms are actually obtained for such sale by or for it.
Interest may be charged in respect of payments not received by KBC Peel Hunt for
value by the required time referred to above at the rate of two percentage
points above the base rate of Barclays Bank plc.
10. Placees' warranties and undertakings to the Company and KBC Peel Hunt
By agreeing with KBC Peel Hunt to subscribe Placing Shares under the Placing you
will irrevocably acknowledge and confirm and warrant and undertake to, and agree
with, each of the Company and KBC Peel Hunt, in each case as a fundamental term
of your application for Placing Shares and of the Company's obligation to allot
and/or issue any Placing Shares to you or at your direction, that:
(a) you agree to and accept all the terms set out in this announcement;
(b) your rights and obligations in respect of the Placing will terminate only in
the circumstances described in this announcement and will not be capable of
rescission or termination by you in any circumstances;
(c) this announcement, which has been issued by the Company, is the sole
responsibility of the Company;
(d) you have not been, and will not be, given any warranty or representation in
relation to the Placing Shares or to the Company or to any other member of its
Group in connection with the Placing, other than by the Company as included in
this announcement or to the effect that the Company is not now in breach of its
obligations under the London Stock's Exchange's AIM Rules for Companies to
disclose publicly in the correct manner all such information as is required to
be so disclosed by the Company;
(e) you have not relied on any representation or warranty in reaching your
decision to subscribe Placing Shares under the Placing, save as given or made by
the Company as referred to in the previous paragraph;
(f) you are not a customer of KBC Peel Hunt in relation to the Placing and KBC
Peel Hunt is not acting for you in connection with the Placing and will not be
responsible to you in respect of the Placing for providing protections afforded
to its customers;
(g) you have not been, and will not be, given any warranty or representation by
any KBC Person in relation to any Placing Shares or the Company or any other
member of its Group;
(h) you will pay the full subscription amount as and when required in respect of
all Placing Shares allocated to you in accordance with such terms and will do
all things necessary on your part to ensure that payment for such shares and
their delivery to you or at your direction is completed in accordance with the
standing CREST instructions (or, where applicable, standing certificated
settlement instructions) that you have in place with KBC Peel Hunt or put in
place with KBC Peel Hunt with its agreement;
(i) you are entitled to subscribe for Placing Shares under the laws of all
relevant jurisdictions which apply to you and you have complied, and will fully
comply, with all such laws (including where applicable, the Anti-Terrorism,
Crime and Security Act 2001, the Proceeds of Crime Act 2002, and the Money
Laundering Regulations 2003) and have obtained all governmental and other
consents (if any) which may be required for the purpose of, or as a consequence
of, such subscription, and you will provide promptly to KBC Peel Hunt such
evidence, if any, as to the identity of any person which it may request from you
(for the purpose of its complying with such Regulations or otherwise in
connection with your participation in the Placing) in the form and manner
requested by KBC Peel Hunt on the basis that any failure by you to do so may
result in the number of Placing Shares that are to be allotted and/or issued to
you or at your direction pursuant to the Placing being reduced to such number,
or to nil, as KBC Peel Hunt may decide at its sole discretion;
(j) you have complied and will comply with all applicable provisions of the FSMA
with respect to anything done or to be done by you in relation to any Placing
Shares in, from or otherwise involving the United Kingdom and you have not made
or communicated or caused to be made or communicated, and you will not make or
communicate or cause to be made or communicated, any "financial promotion" in
relation to Placing Shares in contravention of section 21 of FSMA;
(k) you are a FSMA Qualified Investor;
(l) you are acting as principal only in respect of the Placing or, if you are
acting for any other person in respect of the Placing (1) you are both an
"authorised person" for the purposes of FSMA and a "qualified investor" as
defined at Article 2.1(e)(i) of Directive 2003/71/EC (known as the Prospectus
Directive) acting as agent for such person, and (2) such person is either (i) a
FSMA Qualified Investor or (ii) a "client" (as defined in section 86(2) of FSMA)
of yours that has engaged you to act as his agent on terms which enable you to
make decisions concerning the Placing or any other offers of transferable
securities on his behalf without reference to him;
(m) nothing has been done or will be done by you in relation to the Placing or
to any Placing Shares that has resulted or will result in any person being
required to publish a prospectus in relation to the Company or to any ordinary
shares in accordance with FSMA or the UK Prospectus Rules or in accordance with
any other laws applicable in any part of the European Union or the European
Economic Area;
(n) you are not, and are not acting in relation to the Placing as nominee or
agent for, a person who is or may be liable to stamp duty or stamp duty reserve
tax in respect of any agreement to acquire (or any acquisition of) shares or
other securities at a rate in excess of 0.5% (including, without limitation,
under sections 67, 70, 93 or 96 of the Finance Act 1986 concerning depositary
receipts and clearance services), and the allocation, allotment, issue and/or
delivery to you, or any person specified by you for registration as holder, of
Placing Shares will not give rise to a liability under any such section;
(o) you will not treat any Placing Shares in any manner that would contravene
any legislation applicable in any territory or jurisdiction and no aspect of
your participation in the Placing will contravene any legislation applicable in
any territory or jurisdiction in any respect or cause the Company or KBC Peel
Hunt to contravene any such legislation in any respect;
(p) (applicable terms and expressions used in this paragraph have the meanings
that they have in Regulation S made under the US Securities Act) (1) none of the
Placing Shares has been or will be registered under the US Securities Act, (2)
none of the Placing Shares may be offered, sold, taken up or delivered, directly
or indirectly, into or within the United States except pursuant to an exemption
from, or in transactions not subject to, the registration requirements of the US
Securities Act, (3) you are not within the United States and you are not a US
person, (4) you have not offered, sold or delivered and will not offer sell or
deliver any of the Placing Shares to persons within the United States, directly
or indirectly, (5) neither you, your affiliates, nor any persons acting on your
behalf, have engaged or will engage in any directed selling efforts with respect
to the Placing Shares, (6) you will not be subscribing Placing Shares with a
view to resale in or into the United States, and (7) you will not distribute any
offering material relating to Placing Shares, directly or indirectly, in or into
the United States or to any persons resident in the United States;
(q) KBC Peel Hunt 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 other KBC Person or any person
associated with any KBC Person to do so;
(r) time is of essence as regards your obligations under this Appendix;
(s) you shall indemnify and hold each of the Company and KBC Peel Hunt harmless,
on an after tax basis, from any and all costs, claims, liabilities and expenses
(including legal fees and expenses) arising out of or in connection with any
breach by you of the terms in this Appendix;
(t) this Appendix and any contract which may be entered into between you and KBC
Peel Hunt and/or the Company pursuant to it or the Placing shall be governed by
and construed in accordance with the laws of England, for which purpose you
submit to the exclusive jurisdiction of the courts of England and Wales as
regards any claim, dispute, or matter arising out of or relating to this
Appendix or such contract, except that each of the Company and KBC Peel Hunt
shall have the right to bring enforcement proceedings in respect of any
judgement obtained against you in the courts of England and Wales in the courts
of any other relevant jurisdiction; and
(u) nothing in this Appendix shall exclude any liability of any person for fraud
on its part. All times and dates in this announcement are subject to amendment
at the discretion of KBC Peel Hunt, except that in no circumstances will the
date scheduled for Admission be later than the Long Stop Date. None of your
rights or obligations in respect of the Placing is conditional on any other
person agreeing to subscribe any Placing Shares under the Placing and no failure
by any other Placee to meet any of its obligations in respect of the Placing
shall effect any of your obligations in respect of the Placing.
APPENDIX 2
DEFINITIONS
"Admission" the admission of Placing Shares to trading on AIM
"AI the London Stock Exchange's rules for companies
relating to AIM titled "AIM Rules for Companies"
"Board" the Company's board of directors "
"Company" Turbo Power Systems Inc
"Directors" the directors of the Company
"Existing Ordinary Shares Common Shares in issue on the date of this
announcement
"FSA" the Financial Services Authority
"FSMA" the Financial Services and Markets Act 2000
"FSMA Qualified Investor" a person who is a "qualified investor" as referred
to at section 86(7) of FSMA and at or to whom any
private communication relating to the Company that
is a "financial promotion" (as such term is used
in relation to FSMA) may lawfully be issued,
directed or otherwise communicated without the
need for it to be approved, made or directed by an
"authorised person" as referred to in FSMA
"Group" the group of which the Company is the parent and
its subsidiary undertakings are members
"KBC Peel Hunt" KBC Peel Hunt Ltd
"KBC Person" any person being (i) KBC Peel Hunt, (ii) an
undertaking which is a subsidiary undertaking of
KBC Peel Hunt, (iii) a parent undertaking of KBC
Peel Hunt or (other than KBC Peel Hunt) a
subsidiary undertaking of any such parent
undertaking, or (iv) a director, officer, agent
or employee of any such person
"Ordinary Shares" common shares of no par value in the Company
"Placees" persons who agree to subscribe Placing Shares
pursuant to the Placing
"Placing" the proposed conditional placing of Placing Shares
pursuant to the Placing Agreement
"Placing Agreement" the conditional placing agreement relating to the
Placing between the Company and KBC Peel Hunt
dated the same date as this announcement
"Placing Price" 9 pence per Placing Share
"Placing Shares" new Common Shares to be made available for
subscription under the Placing
"Shareholders" holders of Common Shares
"UK" or "United Kingdom" the United Kingdom of Great Britain and Northern
Ireland
"United States" the United States of America, its territories and
possessions, any State of the United States and
the District of Columbia
"US Securities Act" the US Securities Act of 1933
This information is provided by RNS
The company news service from the London Stock Exchange
END
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