TIDMTRU TIDMTRU
RNS Number : 5301W
TruFin PLC
17 April 2019
17 April 2019
THIS ANNOUNCEMENT, INCLUDING THE APPICES AND THE INFORMATION
CONTAINED IN THEM, IS RESTRICTED AND IS NOT FOR PUBLICATION,
RELEASE OR DISTRIBUTION, DIRECTLY OR INDIRECTLY, IN WHOLE OR IN
PART, IN OR INTO OR FROM THE UNITED STATES, AUSTRALIA, CANADA,
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WHICH SUCH PUBLICATION, RELEASE OR DISTRIBUTION WOULD BE UNLAWFUL.
PLEASE SEE THE IMPORTANT NOTICES WITHIN THIS ANNOUNCEMENT. THIS
ANNOUNCEMENT IS NOT AN OFFER OF SECURITES FOR SALE OR SOLICITATION
OF AN OFFER TO BUY THE SECURITIES DISCUSSED HEREIN IN THE UNITED
STATES, AUSTRALIA, CANADA, JAPAN OR IN ANY JURISDICTION IN WHICH
SUCH OFFER OR SOLICITATION WOULD BE UNLAWFUL.
THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION AS STIPULATED
UNDER THE MARKET ABUSE REGULATION (EU) NO.596/2014.
TRUFIN PLC
("TruFin" or the "Company")
DEMERGER OF DFC
SALE OF ZOPA
RETURN OF VALUE TO SHAREHOLDERS
CONDITIONAL SALE OF SHARES IN DFC HOLDINGS ON BEHALF OF
ARROWGRASS MASTER FUND AND TRUFIN EBT
NOTICE OF GENERAL MEETING
TruFin is announcing, subject to shareholder approval, the
demerger of Distribution Finance Capital Limited ("DFC") from
TruFin to a new holding company, Distribution Finance Capital
Holdings plc ("DFC Holdings") to be admitted to trading on AIM.
TruFin believes that this will maximise the opportunity for DFC to
obtain a bank licence.
TruFin has also negotiated the sale of its entire stake in Zopa
Group Limited ("Zopa") to Arrowgrass Master Fund Ltd ("Arrowgrass")
for GBP44.5 million, subject to TruFin shareholder approval, and is
investing GBP25 million of the proceeds of the sale into DFC to
fund its Tier 1 equity.
Subject to the Demerger being completed, the Board is proposing
to return a minimum GBP10 million to shareholders during 2019, with
GBP5 million being returned by 30 June 2019 and the remaining GBP5
million by 31 December 2019. The Board is currently considering the
most appropriate arrangement to facilitate this.
In addition, Arrowgrass and the TruFin Employee Benefit Trust
("TruFin EBT") have conditionally placed 20.66% of DFC Holdings
(the "Sale Shares") to institutional investors (the "Vendor
Placing") at the Placing Price of 90 pence per Sale Share,
reflecting 1.2x Equity Book Value of DFC. This will result in
Arrowgrass holding less than 50% of DFC Holdings at the time of
admission of DFC Holdings to trading on AIM.
An accelerated bookbuild to allow further investors to
participate at the Placing Price will be launched following this
announcement and will be open for a short period. Macquarie is
acting as Sole Bookrunner in connection with the Vendor Placing,
including the accelerated bookbuild. The result of the Vendor
Placing will be announced as soon as possible after close of the
accelerated bookbuild. The timings for the close of the bookbuild
process are at the absolute discretion of Macquarie. The terms and
conditions of the Vendor Placing are set out in Part B of this
announcement.
Henry Kenner, Chairman and Chief Executive Officer
commented:
"This has been a truly momentous period for TruFin. Having
completed the TruFin IPO in February 2018, we have seen, in the
full year 2018 results announced today, our businesses deliver in
terms of customer penetration and combined revenues with this
momentum continuing into 2019.
However, in December 2018 we announced a delay to DFC obtaining
a bank licence. After due consideration and in order to provide DFC
with the best possible opportunity to obtaining a bank licence we
have decided to propose the demerger of DFC into a separate AIM
listed company.
We are immensely proud that we founded DFC, nurtured it,
financed it and backed the highly experienced management team to
create a robust and valuable niche lender. We have every confidence
in the team as it looks to complete the bank licence process and
continue its exciting growth trajectory.
The sale of the Zopa stake held by TruFin is an acceleration of
the commitment made at the time of the TruFin IPO to recycle
capital, where possible, within the Group to fund the growth
ambitions of DFC and the other lending businesses. Following this
disposal, an early return of value to TruFin shareholders during
2019 is appropriate as evidence of our ability to deliver for our
shareholders.
Following the proposed transactions announced today, we will
ensure that the reorganised TruFin Group will be scaled
appropriately.
Whilst we did not anticipate the need to demerge DFC so soon
after the TruFin IPO, we have acted swiftly and decisively with a
focus on shareholder value. The remaining TruFin Group has the core
objectives of reaching profitability and maximising the value of
shareholders' assets.
Scalable niche lenders are highly sought after due to their
rarity and attractive return profiles. Our experience to date with
DFC and Zopa highlights our ability to originate and fund these
exceptional opportunities. We wish them both every success for the
future!
Meanwhile, our remaining businesses continue to demonstrate
attractive growth profiles and are showing encouraging signs of
becoming powerful origination engines. We look forward to
supporting them in 2019 and beyond.
Finally, I would like to express my thanks to shareholders for
your ongoing support.
Henry Kenner"
For further information, please contact:
TruFin plc
Henry Kenner, Chief Executive Officer
James van den Bergh, Deputy Chief Executive
Officer 0203 743 1340
Macquarie Capital (Europe) Limited (NOMAD and
joint broker)
Alex Reynolds
Nicholas Harland 0203 037 2000
Liberum Capital Limited (Joint broker)
Chris Clarke
Trystan Cullen
Louis Davies 0203 100 2000
Blue Pool Communications (PR)
Nicholas Lord 07501 271 083
About TruFin plc:
TruFin plc is the holding company for an operating group of
companies that are niche lenders and early payment providers.
TruFin Group combines the benefits of both the traditional
relationship banking model and developments in the FinTech sector.
The Company was admitted to AIM in February 2018 and trades under
the ticker symbol: TRU. More information is available on the
Company website www.TruFin.com
1. Background to the proposals
TruFin is the holding company of an operating group comprising
three growth-focused FinTech and banking businesses operating in
three niche finance markets supply chain finance, invoice finance
and dynamic discounting. In addition, TruFin owns a minority stake
in Zopa, a leading UK consumer peer-to-peer lender, which operates
independently of the TruFin Group.
TruFin has today announced the publication of its financial
results for the year ended 31 December 2018 together with a trading
update, which are available on its website www.trufin.com.
Since the IPO of TruFin in February 2018, TruFin's main business
in the supply chain finance sector, DFC, has continued to
successfully grow its balance sheet. To date, DFC's balance sheet
growth has been funded by both debt and equity from TruFin and
third party wholesale funding.
The award of a bank licence to DFC would diversify DFC's funding
sources and also enable DFC to replace the funding provided by
TruFin in the medium term. Customer deposits, obtained under a
banking licence, would be an attractively priced and dependable
source of funding for DFC. In June 2018, DFC therefore submitted a
banking licence application to the PRA.
Following engagement with the PRA, the TruFin Board considers
that to maximise the opportunity for DFC to obtain a bank licence
in the short to medium term the following should occur:
- DFC should no longer form part of the wider TruFin Group,
which engages in financial services activities, but which is not
regulated as a banking group;
- Arrowgrass should reduce its voting control over DFC, whether
direct or indirect, to below 50%; and
- DFC should be capitalised with an incremental GBP25 million to
provide sufficient capital to support the next 12 months of
expected balance sheet growth following licence award as set out in
DFC's regulatory business plan.
Following a review, the TruFin Board has concluded that the
award of the banking licence to DFC in the short to medium term is
the best option for maximising value for TruFin Shareholders. The
TruFin Board is therefore proposing:
- the Demerger of DFC into a separate AIM listed company, with
the existing shareholders in TruFin being given one new share in a
new holding company of DFC for each existing TruFin Ordinary Share;
and
- the sale of its stake in Zopa to Arrowgrass for a total cash
consideration of GBP44.5 million, equal to the carrying book value
of Zopa in TruFin's accounts as at 31 December 2018.
On Admission (and prior to any sell down by Arrowgrass and the
TruFin EBT) the TruFin Shareholders will hold 91.3% of DFC
Holdings.
The sale of TruFin's stake in Zopa, when aggregated with the
Demerger constitutes a fundamental change of business for the
purpose of Rule 15 of the AIM Rules. Accordingly, the TruFin Board
is seeking TruFin Shareholder approval to sell its stake in Zopa
and demerge DFC from the TruFin Group for the purposes of Rule 15
of the AIM Rules at a General Meeting of TruFin Shareholders to be
held on 7 May 2019.
It is proposed that DFC will be demerged to a new company called
Distribution Finance Capital Holdings plc. DFC Holdings is seeking
admission of its entire issued and to be issued ordinary share
capital to trading on AIM on 9 May 2019. The Demerger is
conditional, inter alia, upon the approval of TruFin Shareholders
at the General Meeting and completion of the Zopa Transaction.
If the Demerger proceeds, the TruFin Shareholders who are
registered on the TruFin Share Register at the Demerger Record Time
will receive one DFC Holdings Ordinary Share for every one TruFin
Ordinary Share then held by them.
The Demerger is expected to become effective on 8 May 2019.
Following the Demerger, TruFin will remain the ultimate holding
company of the Continuing TruFin Group and will continue to be
traded on AIM.
Concurrently with these proposals, Arrowgrass has informed the
TruFin Board that it has arranged the disposal of sufficient new
shares in DFC Holdings such that after completion of the Demerger,
it will own less than 50% of the votes in the equity share capital
of DFC Holdings. The TruFin EBT has also agreed to sell its
resultant holding of shares in DFC Holdings arising pursuant to the
Demerger. Accordingly, TruFin also announces that Arrowgrass and
the TruFin EBT have agreed to sell 22,031,874 Sale Shares
(representing 20.66% of the DFC Holdings issued share capital on
DFC Holdings Admission) at the Placing Price of GBP0.90 per DFC
Holdings Share. Pursuant to the Sale Agreement, the Sale Shares are
being offered to institutional and other investors by way of an
accelerated bookbuild which will be launched immediately following
this announcement subject to the terms and conditions set out in
Part B of this announcement. The Arrowgrass Sale and TruFin EBT
Sale will occur at the time of, and conditional upon, DFC Holdings
Admission.
Certain Directors of TruFin and DFC have indicated an intention
to acquire shares in the bookbuild.
On DFC Holdings Admission, DFC Holdings is expected to have a
market capitalisation of GBP96 million, based on the Placing Price.
Following the Demerger and DFC Holdings Admission, Arrowgrass will
continue to hold 73.62% of TruFin but its shareholding in DFC
Holdings will have reduced to 48.99% (assuming no other changes to
its TruFin shareholding prior to the Demerger Effective Time).
Later today DFC Holdings expects to publish the DFC Holdings
Admission Document in connection with DFC Holdings Admission and
TruFin expects to publish the circular containing the Notice of
General Meetings.
2. Demerger: in the best interests of TruFin Shareholders
At the time of TruFin's IPO, the TruFin Board had a key
strategic objective of obtaining a banking licence for DFC. The
rationale then, as now, was that a banking licence offers the most
appropriate funding model for DFC's business. Flexibility and depth
of the deposits market enables DFC to optimise its business model
and be able to continue satisfying its customers' needs
independently of wholesale funding markets.
When the PRA informed the TruFin Board of its decision in
December 2018 that there was likely to be a delay to the announced
timetable for the approval of DFC's banking licence and following
the announcement of this to the market, the TruFin Board commenced
a review of the best way forward for TruFin Shareholders. As part
of that review, consideration was given to all practical means to
obtain a banking licence including, inter alia, the possibility of
applying prudential consolidation to the wider TruFin Group and
whether to withdraw the current application and re-apply at a late
date. These were ultimately dismissed as impractical, costly and
time-consuming.
The TruFin Board has concluded that the best interests of TruFin
Shareholders would be served by prioritising the attainment of a
banking licence in as timely a manner as possible.
With this conclusion and given the timetable of the existing
licence application made to the PRA, first submitted in June 2018
and subject to a 12 month evaluation and decision making period,
the TruFin Management Team has worked with the Board of DFC to
pursue the Demerger and listing of DFC Holdings on AIM.
3. TruFin's strategic goals and objectives
Following the Zopa Transaction and Demerger, TruFin will be the
holding company of an operating group comprising two growth-focused
FinTech businesses operating in invoice finance and dynamic
discounting: Oxygen and Satago.
The strategic goal, as at the TruFin IPO, remains that of
operating and creating a stable of niche lenders and payment
providers whether through organic growth or acquisition.
The Directors believe that each of Oxygen and Satago operates in
attractive niche markets. TruFin's flexible product offerings,
focus on customer service and the effective use of technology,
allows it to address the challenges of scalability and customer
acquisition costs.
The Directors continue to believe that the growth of Oxygen and
Satago will largely be organic rather than through mergers and
acquisitions. However, the Directors will also continue to monitor
acquisition opportunities that arise in the normal course of
business.
The Directors have the following strategic objectives for each
business:
Oxygen's future objectives and strategy
Oxygen will continue to build new client and supplier
relationships which, given the operational gearing in the business,
are expected to lead in turn to profitability and enhanced
performance.
The Directors believe that Oxygen's product offering is well
developed, robust and scalable. Oxygen's objective is to sign up
more customers, sell more product to existing customers and benefit
from inherent operational gearing in the business. In order to
attract more customers, Oxygen has invested in improving its sales
and onboarding teams through 2018.
It is also a focus of Oxygen's management to ensure that its
customers fully benefit from the implementation of its services and
to that end it continues to develop techniques to on-board more
suppliers in a more efficient and timely manner.
In the medium term, Oxygen aims to continue its expansion in the
UK public sector including with smaller councils and through
further expansion into the NHS and Central Government.
Simultaneously, Oxygen will pursue growth in the corporate sector,
initially targeting large corporates with similar characteristics
to the public sector.
Additionally, Oxygen plans to expand its product offering to its
customer base. To that end it acquired Porge during 2018 and this
has now been integrated into Oxygen. The strategy is to roll out
this research insight service to existing customers of both
companies.
The TruFin Board has every confidence in Oxygen's value and
performance. However, TruFin will consider over time whether Oxygen
would be more highly valued by an alternative owner. Once Oxygen
has further demonstrated the achievement of key performance
targets, the TruFin Board may therefore consider initiating a sale
process.
Satago's future objectives and strategy
At the time of TruFin Admission, the Company stated that Satago
was a nascent business with great potential. During 2018, that
potential has begun to be realised.
In the core invoice financing business, customer acquisition is
the key to success. The business' strategy was, and remains, to
adopt a partnership model as a means of gaining the necessary
traction and brand awareness. During 2018 the number of interested
partners has grown materially and the business is starting to see
the direct benefits in terms of business volumes. The Satago
management is optimistic that these partnerships will develop
further during 2019 and form the basis for future growth.
As the business has grown, the demand for a broader range of
financing products has become increasingly apparent. The launch of
such products will be explored in 2019, initially focusing on other
short-term working capital facilities. Such new products will round
out Satago's overall customer offering.
Satago's technology has been a key factor in attracting
potential partners and customers. To that end it is a core
objective to continue to invest in the platform.
With an increasing market presence and Satago's technological
strength, various fee-paying services are now being considered in
addition to the core lending business as another source of
revenue.
In addition to the core business, Satago also offers some niche
speciality lending in two verticals that exhibit attractive funding
opportunities: mobile games publishing and the funding of financial
intermediaries. It is a strategic goal to continue to develop these
existing verticals, and where appropriate, add additional
niches.
Satago will continue to target its origination of high yielding
short-dated working capital assets, while managing risk via a
superior understanding of the credit risk of prospective
counterparties provided by its advanced technology and integrated
customer business model.
Board and organisational structures
There are no expected immediate changes to the board or senior
management of TruFin, DFC or DFC Holdings following the
Demerger.
However, the TruFin Board will be conducting a full review of
Head Office costs following the Demerger to ensure they are scaled
appropriately for the Continuing TruFin Group.
Financial effects of the Demerger and Zopa Transaction
Having made due and careful enquiry, the Directors are of the
opinion that, taking into account the net proceeds of the Zopa
Transaction, the Company and the Continuing TruFin Group will have
sufficient working capital available for their present
requirements, that is, for at least the 12 months following the
Demerger Effective Date.
For the financial year ended 31 December 2018, the TruFin Group
had gross turnover of GBP9.5 million and an underlying operating
loss, excluding share based payment charge, of GBP12.8 million. As
at 31 December 2018, the TruFin Group had total net assets of
GBP153.2 million.
For the financial year ended 31 December 2018, DFC had gross
turnover of GBP5.2 million and an underlying operating loss of
GBP7.0 million. As at 31 December 2018, DFC had total net assets of
GBP54.6 million.
At 31 December 2018, DFC had outstanding loans to TruFin (the
"TruFin Loans") amounting to GBP10 million and preference shares
(together with accrued but unpaid dividends) amounting to
approximately GBP4 million. Since the year end, these preference
shares have been repaid and advanced as further TruFin Loans.
These, together with a further GBP5 million advanced since the year
end by TruFin, means that the total outstanding amount of TruFin
Loans at the date of this announcement, is approximately GBP19
million. The TruFin Loans shall accrue interest at a rate of 5% per
annum, and (i) GBP5,000,000 is repayable by 1 December 2019; (ii)
GBP5,000,000 is repayable by 1 June 2020; and (iii) 8,868,219 is
repayable by 1 December 2020, in each case, together with any
accrued, but unpaid interest thereon.
Following completion of the Zopa Transaction but prior to the
Demerger, TruFin Holdings will subscribe for GBP25 million of new
DFC Shares pursuant to the Subscription and Share Exchange
Agreement.
Completion of the Zopa Transaction shall result in the
investment held by the TruFin Group being reduced by GBP44.5
million with a corresponding increase in cash.
TruFin will also return a minimum of GBP10 million to TruFin
Shareholders during 2019, of which a return of at least GBP5
million shall be effected by 30 June 2019 and the remainder by 31
December 2019. The TruFin Board is currently considering the most
appropriate arrangement to facilitate this.
4. Summary of how the Demerger is to be effected
The Demerger is to be effected by TruFin returning to TruFin
Shareholders capital in an amount equal to the market value of
TruFin's shareholding in DFC as at the Demerger Effective Time. The
return of capital to TruFin Shareholders will be satisfied by the
transfer by TruFin to DFC Holdings of its DFC Shares and the
allotment and issue by DFC Holdings of 97,368,420 DFC Holdings
Demerger Shares credited as fully paid to the holders of TruFin
Ordinary Shares who are registered on the TruFin Share Register at
the Demerger Record Time.
Subject to the passing of a resolution by TruFin Shareholders,
this will involve:
- the conversion of the existing TruFin Ordinary Shares of no
par value into TruFin Ordinary Shares of GBP1.90 each by
transferring the amount to the credit of TruFin's stated capital
account immediately prior to the conversion to TruFin's nominal
account;
- the subdivision and redesignation of each TruFin Ordinary
Share of GBP1.90 each into one TruFin New Ordinary Share of GBP0.91
each and one DFC Cancellation Share of GBP0.99 each credited as
fully paid;
- the cancellation of the DFC Cancellation Shares and the
reduction of TruFin's nominal capital account, which is expected to
amount to GBP96.4 million in aggregate; and
- the return of capital by TruFin to TruFin Shareholders of an
amount equal to the market value of TruFin's shareholding in DFC as
at the Demerger Effective Time. The return of capital to TruFin
Shareholders will be satisfied by the transfer by TruFin to DFC
Holdings of 21,861,433 DFC Shares and the allotment and issue of
97,368,420 DFC Holdings Demerger Shares credited as fully paid by
DFC Holdings to TruFin Shareholders who are registered on the
TruFin Share Register at the Demerger Record Time on the basis of
one DFC Holdings Ordinary Share for every one TruFin Ordinary Share
then held.
DFC Holdings' share capital comprises one ordinary share and
50,000 redeemable preference shares and, therefore, the TruFin
Board intends to allot and issue Redeemable Shares in TruFin prior
to the Demerger becoming effective in order to ensure that the
share capital of DFC Holdings mirrors as nearly as may be the share
capital of TruFin as at the Demerger Record Time.
DFC Holdings will be an unquoted public limited company pending
its admission to trading on AIM which is expected to take place at
8.00 a.m. on the Business Day following the Demerger.
The Demerger is conditional, inter alia, on:
- the approval by TruFin Shareholders of the Demerger Resolutions;
- completion of the Zopa Transaction and the subsequent GBP25
million subscription into DFC from the proceeds of the Zopa
Transaction;
- the DFC Introduction Agreement not being terminated prior to the Demerger Effective Time; and
- no other events or developments occurring or existing that, in
the judgment of the TruFin Board, in its sole and absolute
discretion, would make it inadvisable to effect the Demerger.
Save for the approval of TruFin Shareholders, no other approvals
are outstanding for the implementation of the Demerger.
Neither TruFin nor DFC Holdings will have a shareholding in the
other following the Demerger.
Henry Kenner and James van den Bergh will be the only directors
common to both TruFin and DFC Holdings after the Demerger.
It is proposed that an application will be made for the DFC
Holdings Ordinary Shares to be admitted to trading on AIM on or
around 9 May 2019.
The relationship agreement between Arrowgrass, Macquarie and
TruFin will continue despite the Demerger as a result of Arrowgrass
continuing to hold 73.62% of TruFin's issued share capital
following the Demerger (assuming no other changes to its TruFin
shareholding prior to the Demerger Effective Time).
Each of Arrowgrass and Watrium has also entered into a
relationship agreement with DFC Holdings as a result of their
expected shareholdings in DFC Holdings on DFC Holdings Admission,
further details of which will be set out in the DFC Holdings
Admission Document.
5. Exchange of shares in DFC for shares in DFC Holdings
Conditional upon and with effect on DFC Holdings Admission, the
DFC Management Shareholders, TruFin EBT and DFC EBT have agreed to
transfer their DFC Management Shares in exchange for the issue of
the 9,273,505 DFC Holdings Ordinary Shares in DFC Holdings issued
share capital on DFC Holdings Admission.
6. Summary of Zopa Transaction and Use of Proceeds
The TruFin Board has today announced that it has agreed
definitive terms to sell its stake in Zopa to Arrowgrass for a
total cash consideration of GBP44.5 million.
It had been anticipated at the time of the IPO of TruFin that
Zopa would look to carry out an IPO and at that future time the
Directors would consider whether to sell TruFin's interest in Zopa,
subject to a satisfactory valuation being achieved and the
Directors determining how the proceeds should be allocated to
maximise TruFin Shareholder value. The agreement with Arrowgrass,
announced today, brings forward that decision.
At the time of TruFin's IPO, TruFin's c.15% stake in Zopa was
valued at GBP36.5 million. Since that time, Zopa has undertaken a
further capital raise which led to TruFin raising the value of its
stake in Zopa to GBP44.5 million, as previously announced on 3
August 2018. As at 31 December 2018, Zopa's carrying value was
GBP44.5 million.
The Zopa Transaction is conditional upon the passing of the
Demerger Resolutions at the General Meeting and is expected to
complete upon conclusion of the General Meeting on 7 May 2019.
The total cash proceeds of the Zopa Transaction are intended to
be used by TruFin for the following purposes:
- GBP25 million for capitalising DFC's balance sheet for
lending. Accordingly, it is proposed that following completion of
the Zopa Transaction but prior to the Demerger, TruFin Holdings
will subscribe for GBP25 million of new DFC Shares pursuant to the
Subscription and Share Exchange Agreement;
- GBP9.5 million for additional working capital to support and
implement the strategy of the Continuing TruFin Group, including
the costs and expenses payable by the Company relating to the
Demerger;
- to return a minimum of GBP10 million to TruFin Shareholders
during 2019, of which a return of at least GBP5 million shall be
effected by 30 June 2019 and the remainder by 31 December 2019. The
TruFin Board is currently considering the most appropriate
arrangement to facilitate this.
In the event that Arrowgrass ceases to be an "Affiliate" of
TruFin Holdings for the purposes of Zopa's articles of association
(i.e. Arrowgrass ceases to hold directly or indirectly more than
50% of the voting rights in TruFin Holdings) such that it would be
required under the articles to retransfer the shares to TruFin
Holdings (and a waiver or amendment to such provisions is not
obtained), Arrowgrass shall transfer the shares back to TruFin
Holdings for nil consideration, whereupon the Re-Transfer Agreement
entered into by TruFin Holdings and Arrowgrass on 17 April 2019
shall apply and Arrowgrass shall retain the benefit of economic
rights to the shares in Zopa whilst TruFin Holdings holds the legal
and beneficial ownership in such shares.
TruFin Shareholders should be aware that if the Demerger
Resolutions are not approved at the General Meeting and the Zopa
Transaction does not take place on or around 7 May 2019, the net
proceeds of the Zopa Transaction will not be received by TruFin
Holdings and the Demerger would not proceed.
If the Demerger Resolutions are not approved by the TruFin
Shareholders the TruFin Board would be limited in its ability to
implement the strategy of either the TruFin Group or the DFC Group.
Further, the Company would be forced to seek further finance
immediately, most likely through an equity fundraising with
existing TruFin Shareholders. The TruFin Board believes that this
fundraising route, even if it raises sufficient funds to meet the
working capital requirements of the Company, could have an adverse
impact on the TruFin Group's business, reputation, financial
condition and/or operating results.
The Zopa Transaction constitutes a related party transaction
under Rule 13 of the AIM Rules as a result of Arrowgrass ownership
of 73.62% of the issued share capital of TruFin.
The Directors of TruFin, having consulted with Macquarie in its
capacity as TruFin's nominated adviser for the purposes of the AIM
Rules, consider the terms of the Zopa Transaction to be fair and
reasonable insofar as the Company's shareholders are concerned.
7. Current trading and prospects
TruFin
2019 has commenced well and revenues for the TruFin Group
(including DFC) for the first quarter ended 31 March 2019 were
GBP3.9 million (unaudited).
Oxygen continues to win customers and the sales pipeline for
2019 remains robust.
Satago anticipates strong demand in 2019 from the partnerships
it has formed. However, capital remains a constraining factor in
realising this demand. Following the Demerger, together with the
steps described in this announcement such as the Zopa Transaction,
this will be addressed.
DFC
During the first three months of the current financial year DFC
has continued to see strong demand for its product offering. This
has resulted in loans advanced increasing by in excess of 25% to
GBP143 million (unaudited) and credit lines increasing by 26% to
GBP253 million (unaudited) for the three months to end of March
2019. This has been coupled with strong growth in the number of
manufacturers and dealers signed up.
For the remainder of 2019 the Directors expect to see
continuation of this strong asset growth, even if a bank licence is
not obtained during the year, given the existing funding in place
and assuming that the current advanced discussions on mezzanine
funding successfully conclude. The potential granting of a bank
licence is not expected to require significant incremental
investment during the year as the governance and operating
processes required are already in place.
DFC signed an initial GBP40 million committed senior facility
with Citibank in December 2017. The senior facility with Citibank
first extended to GBP100 million in September 2018 and earlier
today was further extended to GBP155 million (the "Citi SFA").
Under the Citi SFA, the provision of finance to DFC is indirect;
Citibank advance funds to DFC Funding No. 1 Limited ("DFC Funding")
(a special purpose vehicle which is not part of the Group and over
which Citibank have taken security) to enable DFC Funding to
purchase loan receivables from DFC. As part of the arrangement, DFC
has provided DFC Funding with a GBP20 million mezzanine revolving
loan facility and a GBP5 million junior facility to allow DFC
Funding to acquire from DFC certain loans made by DFC to
dealers.
Information on the financial performance of DFC for the
financial year ended 31 December 2018 and business outlook is
contained within the DFC Holdings Admission Document, enclosed with
this document.
8. Share incentive arrangements
A. Existing Share incentive arrangements
The Company has historically incentivised senior management by
offering participation in the TruFin plc Performance Share Plan
2018 (the "PSP") and the TruFin plc Joint Share Ownership Plan 2018
(the "JSOP").
The TruFin plc Performance Share Plan 2018
As at the date of this announcement, options in respect of
9,276,316 TruFin Ordinary Shares have been granted under the PSP,
equivalent to approximately 9.53% of TruFin's issued share capital.
There are three categories of options granted under the PSP which
are set out below.
PSP Market Value Awards
Options over a total of 4,868,420 TruFin Ordinary Shares were
granted to the TruFin Management Team on the date of TruFin
Admission in the following amounts (the "PSP Market Value Awards"),
equivalent to, at the time of grant, approximately 5% of the
Company's issued share capital:
Name Number of TruFin Ordinary
Shares
Henry Kenner 2,190,789
---------------------------------------
James van den Bergh 1,703,947
---------------------------------------
Jason Rogers 486,842
---------------------------------------
Raxita Kapashi 486,842
---------------------------------------
Total 4,868,420
---------------------------------------
The PSP Market Value Awards have an exercise price of 190p per
share and vest automatically in 20% tranches on the achievement of
share price targets. The PSP Market Value Awards were a one off
award made at the time of TruFin Admission and therefore further
awards on the same terms have not and will not be granted in the
future under the PSP. Following vesting, the PSP Market Value
Awards are exercisable until the tenth anniversary of TruFin
Admission. Further details in respect of the PSP Market Value
Awards were set out in Part 4 of the TruFin Admission Document.
PSP Performance Awards
Nil cost options over a total of 1,000,001 TruFin Ordinary
Shares were granted to the TruFin Management Team on the date of
TruFin Admission in the following amounts (the "PSP Performance
Awards"), equivalent to, at the time of grant, approximately 1.3%
of the Company's issued share capital:
Name Number of TruFin Ordinary
Shares
Henry Kenner 368,421
---------------------------------------
James van den Bergh 263,158
---------------------------------------
Jason Rogers 184,211
---------------------------------------
Raxita Kapashi 184,211
---------------------------------------
Total 1,000,001
---------------------------------------
The PSP Performance Awards vest on the third anniversary of the
date of TruFin Admission to the extent that performance targets
relating to the business plans of Oxygen and DFC are met. It is
intended that PSP Performance Awards (or similar) will be granted
annually under the PSP. Following vesting, the PSP Performance
Awards are exercisable until the tenth anniversary of the date of
TruFin Admission. Further details in respect of the PSP Performance
Awards were set out in Part 4 of the TruFin Admission Document.
PSP Founder Awards
Nil cost options over a maximum of 3,407,895 TruFin Ordinary
Shares, in aggregate, were granted to Henry Kenner and James van
den Bergh (the "TruFin Founders") on the date of TruFin Admission
in the following amounts (the "PSP Founder Awards"), equivalent to,
at the time of grant, approximately 3.5% of the Company's issued
share capital:
Name Number of TruFin Ordinary
Shares
Henry Kenner 1,825,658
---------------------------------------
James van den Bergh 1,582,237
---------------------------------------
Total 3,407,895
---------------------------------------
The PSP Founder Awards vest automatically in tranches of 25% per
year from the first anniversary of the date of TruFin Admission.
The maximum number of TruFin Ordinary Shares that option holders
are entitled to receive in connection with the PSP Founder Awards
is limited. If the market value of a TruFin Ordinary Share exceeds
190p at the time of vesting, the number of TruFin Ordinary Shares
subject to the vested part of the PSP Founder Award is reduced to
ensure that the maximum aggregate value (at the time of vesting) of
the TruFin Ordinary Shares in respect of which the PSP Founder
Award has vested, is limited to 190p per TruFin Ordinary Share.
25% of the PSP Founder Awards vested on 21 February 2019, the
result of which was that the award holders are entitled to exercise
their PSP Founder Awards in respect of the following number of
TruFin Ordinary Shares:
Name Number of TruFin Ordinary
Shares
Henry Kenner 437,973
---------------------------------------
James van den Bergh 379,577
---------------------------------------
Total 817,550
---------------------------------------
Following vesting, the PSP Founder Awards are exercisable until
the tenth anniversary of TruFin Admission. Further details in
respect of the PSP Founder Awards are set out in Part 4 of the
TruFin Admission Document.
Joint Share Ownership Plan 2018
Under the JSOP, award holders jointly hold TruFin Ordinary
Shares with the trustee of the TruFin plc Employee Benefit Trust
(the "TruFin EBT Trustee").
JSOP awards in respect of, in aggregate, 3,407,895 TruFin
Ordinary Shares were awarded to Henry Kenner and James van den
Bergh on the date of TruFin Admission in the following amounts (the
"JSOP Founder Awards"), equivalent to, at the time of grant,
approximately 3.5% of the Company's issued share capital:
Name Number of TruFin Ordinary
Shares
Henry Kenner 1,825,658
---------------------------------------
James van den Bergh 1,582,237
---------------------------------------
Total 3,407,895
---------------------------------------
The JSOP Founder Awards vest automatically in tranches of 25%
per year from the first anniversary of TruFin Admission. Upon
vesting, the award holders become entitled to the value of the
relevant TruFin Ordinary Shares over and above 190p per TruFin
Ordinary Share. Further details in respect of the JSOP Founder
Awards were set out in Part 4 of the TruFin Admission Document.
25% of the JSOP Founder Awards vested on 21 February 2019, the
result of which was that the award holders became entitled to the
value, as at the vesting date, over and above 190p per TruFin
Ordinary Share in respect of 25% of the TruFin Ordinary Shares
subject to the JSOP Founder Awards. Based on the closing share
price of 198p per TruFin Ordinary Share on 20 February 2019, 4.04%
(being the balance of the share price at vesting above 190p,
expressed as a percentage) of the TruFin Ordinary Shares subject to
the vested part of the JSOP Founder Awards became beneficially
owned by the TruFin Founders. As a consequence, they became the
beneficial holders of the following number of TruFin Ordinary
Shares:
Name Number of TruFin Ordinary
Shares received on vesting
of 25% of the JSOP Founder
Awards
Henry Kenner 18,441
-----------------------------------------
James van den Bergh 15,982
-----------------------------------------
Total 34,423
-----------------------------------------
The balance of TruFin Ordinary Shares (being 817,550 TruFin
Ordinary Shares) that were also subject to the 25% of the JSOP
Founder Awards that has vested have ceased to be subject to the
JSOP and are legally and beneficially held by the TruFin EBT
Trustee.
The JSOP Founder Awards and the PSP Founder Awards will together
deliver, in aggregate, a maximum of 3,407,895 existing TruFin
Ordinary Shares.
B. Effect of the Demerger and DFC Holdings Admission on the
share incentive arrangements
As a result of and in consequence of the Demerger, the
Remuneration Committee have agreed with award holders that certain
actions should be taken in relation to the existing share incentive
arrangements. A summary of the relevant actions that it is intended
are taken is set out below. The Remuneration Committee consider
that the resulting outcome is fair for TruFin Shareholders and the
relevant award holders in light of the Demerger and DFC Holdings
Admission.
The actions that are intended to be taken are each in accordance
with the terms on which the original awards were granted except
that the protection from dilution in respect of the TruFin Founder
Awards, and the ability for TruFin Market Value Awards holders to
benefit from a return of value to TruFin Shareholders (in each case
as referred to further below), have been approved of in addition by
the Remuneration Committee, as set out in more detail below.
Founder Awards
The impact of the Demerger and DFC Holdings Admission on the
JSOP Founder Awards and the PSP Founder Awards (the "TruFin Founder
Awards") is as follows.
DFC Holdings Shares held by the TruFin EBT Trustee and the
TruFin Founders
In respect of the 25% of the TruFin Ordinary Shares under the
JSOP Founder Awards that have vested, as a result of the Demerger,
and without any action being taken by the TruFin EBT Trustee or the
TruFin Founders, the TruFin EBT Trustee will, in its sole capacity,
receive 817,550 DFC Holdings Shares and the TruFin Founders will,
in their respective individual capacities, receive the following
number of DFC Holdings Shares:
Name Number of DFC Holdings
Shares
Henry Kenner 18,441
------------------------------------
James van den Bergh 15,982
------------------------------------
Total 34,423
------------------------------------
In respect of the remaining 75% of the TruFin Ordinary Shares
subject to the JSOP Founder Awards that have not yet vested, as a
result of the Demerger, and without any action being taken by the
TruFin EBT Trustee or the TruFin Founders, the TruFin EBT Trustee
and the TruFin Founders will jointly receive 2,555,922 DFC Holdings
Shares as follows:
Name Number of DFC Holdings
Shares
Henry Kenner and TruFin
EBT Trustee 1,369,244
------------------------------------
James van den Bergh and
TruFin EBT Trustee 1,186,678
------------------------------------
Total 2,555,922
------------------------------------
As set out below in more detail, it has been agreed that the
aggregate number of 3,373,472 DFC Holdings Shares to be received by
the TruFin EBT Trustee in connection with the TruFin Founder Awards
as a result of the Demerger shall cease to be subject to the terms
of the JSOP and/or the PSP, and will instead be awarded to the
TruFin Founders by the TruFin EBT Trustee (subject to the
restrictions set out below).
Replacement Founder Awards
In order to ensure that Arrowgrass' post-Demerger shareholding
(when aggregated with the shareholding of the TruFin EBT Trustee)
in DFC Holdings remains below 50%, it has been agreed that the
TruFin EBT Trustee will award part of the DFC Holdings Shares it
receives as a result of the Demerger (and which cease to be subject
to the terms of the JSOP and/or the PSP) to the TruFin Founders.
The number of DFC Holdings Shares to be transferred to each of the
TruFin Founders will be proportionate to the number of TruFin
Ordinary Shares subject to their original TruFin Founder Awards
(the "Replacement Founder Awards").
DFC Holdings Shares subject to the Replacement Founder Awards
will be subject to a restriction on transfer and clawback which
will cease to apply as follows:
(i) 33% of the DFC Holdings Shares shall cease to be subject to
a restriction on transfer and clawback on 21 February 2020;
(ii) 33% of the DFC Holdings Shares shall cease to be subject to
a restriction on transfer and clawback on 21 February 2021; and
(iii) 34% of the DFC Holdings Shares shall cease to be subject
to a restriction on transfer and clawback on 21 February 2022,
(each a "Relevant Date").
If the Replacement Founder Award holder ceases to be an employee
or director within the TruFin Group before a Relevant Date due to
death, ill-health, injury or disability, the restriction on
transfer will cease to apply to the portion of the DFC Holdings
Shares that are otherwise still subject to a restriction on
transfer. If the Replacement Founder Award holder ceases to be an
employee or director within the TruFin Group due to having resigned
or given notice prior to 21 February 2021 or due to summary
dismissal for gross misconduct prior to 21 February 2022, the DFC
Holdings Shares subject to the Replacement Founder Award (that have
not otherwise ceased to be subject to clawback) will be transferred
by them to (or to any other person at the direction of) TruFin for
nil consideration.
If the Replacement Founder Award holder ceases to be an employee
or director (that have not otherwise ceased to be subject to
clawback) within the TruFin Group for any other reason prior to a
Relevant Date, the DFC Holdings Shares will cease to be subject to
clawback but will remain subject to a restriction on transfer on
the same basis as set out above.
In the event of a delisting, a takeover (including by way of a
court sanctioned scheme of arrangement), or the voluntary winding
up of DFC Holdings or TruFin, the Replacement Founder Award shall
cease to be subject to a restriction on transfer and clawback.
The DFC Holdings Shares received by the TruFin EBT Trustee as a
result of the Demerger that are not awarded to the TruFin Founders
in connection with the Replacement Founder Awards shall be disposed
of by the TruFin EBT Trustee and the proceeds will be paid to the
TruFin Founders as a bonus, the whole amount of which will be used
by the TruFin Founders for the purpose of funding the income tax
and employee social security contributions that will arise in
relation to the Replacement Founder Awards and such bonus
payment.
Original TruFin Founder Awards
The PSP Founder Awards and JSOP Founder Awards in respect of the
TruFin Ordinary Shares shall continue on the same terms except that
any reference to the TruFin Ordinary Share price in the related
terms and conditions will be appropriately adjusted by reference to
the respective share price of DFC Holdings and TruFin to reflect
the Demerger.
In addition, in order to reflect the original intention at the
time of TruFin Admission, the Remuneration Committee has agreed
that the TruFin Founders and the TruFin EBT Trustee shall be
protected from dilution in respect of the TruFin Founder Awards in
the event of any equity fundraising by TruFin of up to GBP50
million that commences on or prior to 31 December 2021.
PSP Market Value Awards
As a result of the impact that the Demerger will have on the
term of the PSP Market Value Awards, it has been agreed that the
PSP Market Value Awards will be split in two so that:
(i) part of the award will remain as an option in respect of
TruFin Ordinary Shares (the "TruFin Market Value Awards"); and
(ii) part of the award will be replaced with an award in respect
of DFC Holdings Shares (the "DFC Market Value Awards").
The TruFin Market Value Award
The TruFin Market Value Awards will be on the same terms as the
original PSP Market Value Awards except that the exercise price
will be appropriately adjusted by reference to the respective share
price of DFC Holdings and TruFin to reflect the Demerger.
In addition, the Remuneration Committee has agreed that the
TruFin Market Value Award holders will be given the opportunity to
benefit from any value returned to TruFin Shareholders (following
the Demerger and DFC Holdings Admission and prior to the exercise
of the TruFin Market Value Awards). Where applicable, TruFin Market
Value Award holders will be entitled to receive a cash payment at
the time of the subsequent TruFin annual bonus cycle. Any such cash
payment would be made (where relevant) in addition to any
adjustment made to the exercise price and the target thresholds in
connection with the return of value.
The DFC Market Value Award
The TruFin EBT Trustee will, conditional upon and immediately
following the subscription by TruFin Holdings of 6,530,303 A
ordinary shares in DFC, acquire 478,870 DFC Shares from TruFin for
nil consideration. Such DFC Shares will, as part of the Share
Exchange, be exchanged by the TruFin EBT Trustee for such number of
DFC Holdings Shares as have an equivalent aggregate value (as at
the time of the Share Exchange) as the DFC Shares exchanged.
The DFC Market Value Awards will comprise a restricted share
award pursuant to which the award holder will hold DFC Holdings
Shares in proportion to the number of TruFin Ordinary Shares
subject to their original PSP Market Value Awards.
The DFC Holdings Shares subject to the DFC Market Value Awards
will be provided by the TruFin EBT Trustee using part of the DFC
Holdings Shares it receives as part of the Share Exchange and will
be held by TruFin Management Team subject to a restriction on
transfer and clawback which will cease to apply as follows:
(i) 33% of the DFC Holdings Shares shall cease to be subject to
a restriction on transfer and clawback on 21 February 2020;
(ii) 33% of the DFC Holdings Shares shall cease to be subject to
a restriction on transfer and clawback on 21 February 2021; and
(iii) 34% of the DFC Holdings Shares shall cease to be subject
to a restriction on transfer and clawback on 21 February 2022,
(each a "Relevant Date").
If the DFC Market Value Award holder ceases to be an employee or
director within the TruFin Group before a Relevant Date due to
death, ill-health, injury or disability, the restriction on
transfer will cease to apply to the portion of the DFC Holdings
Shares that are otherwise still subject to a restriction on
transfer.
If the DFC Market Value Award holder ceases to be an employee or
director within the TruFin Group due to having resigned or given
notice prior to 21 February 2021 or due to summary dismissal for
gross misconduct prior to 21 February 2022, the DFC Holdings Shares
subject to the DFC Market Value Award (that have not otherwise
ceased to be subject to clawback) will be transferred by them to
(or to any other person at the direction of) TruFin for nil
consideration.
If the DFC Market Value Award holder ceases to be an employee or
director within the TruFin Group for any other reason prior to a
Relevant Date, the DFC Holdings Shares (that have not otherwise
ceased to be subject to clawback) will cease to be subject to
clawback but will remain subject to a restriction on transfer on
the same basis as set out above.
In the event of a delisting, a takeover (including by way of a
court sanctioned scheme of arrangement), or the voluntary winding
up of DFC Holdings or TruFin, the DFC Market Value Awards shall
cease to be subject to a restriction on transfer and clawback.
The DFC Holdings Shares received by the TruFin EBT Trustee in
connection with Share Exchange that are not awarded to the TruFin
Management Team by the TruFin EBT Trustee in connection with the
DFC Market Value Awards shall be disposed of by the TruFin EBT
Trustee and the proceeds will be paid to the TruFin Founders as a
bonus, the whole amount of which will be used by the TruFin
Management Team for the purpose of funding the income tax and
employee social security contributions that will arise in relation
to the DFC Market Value Awards and such bonus payment.
PSP Performance Awards
As a result of the Demerger, the part of the performance
condition relating to the business plan of DFC will be deemed to be
achieved in full in accordance with the terms of the original
award. To reflect this, it has been agreed that a cash payment will
be made to the award holders calculated by reference to 50% of the
TruFin Ordinary Shares subject to the PSP Performance Awards and a
price per share of 190p. Any such cash payment will be made at the
time of the TruFin annual bonus cycle in February 2020.
The PSP Performance Awards will continue on in their terms
except that the performance condition will relate solely to the
business plan of Oxygen.
The maximum number of TruFin Ordinary Shares in respect of which
awards may be granted to the TruFin Management Team under the PSP
prior to 21 February 2021 will be calculated by reference to a
share price of 190p (being the TruFin Admission price) as
appropriately adjusted by reference to the respective share price
of DFC Holdings and TruFin to reflect the Demerger.
9. General Meeting
The General Meeting of the Company will be held at the offices
of Travers Smith LLP at 10 Snow Hill, London, EC1A 2AL on 7 May
2019 at 10.00 a.m. at which the following Resolutions will be
proposed.
The four Resolutions that are to be proposed at the General
Meeting are:
(1) Approve the Demerger and Zopa Transaction
Resolution 1, which will be proposed as a ordinary resolution,
is to approve the Demerger and Zopa Transaction for the purposes of
Rule 15 of the AIM Rules;
(2) Resolution 2, which will be proposed as a special
resolution, is to:
(i) Authority to allot Shares
authorise the Directors to allot the Redeemable Shares up to
GBP50,000 in nominal value provided that such authority shall
(subject to limited exceptions), expire fifteen months from the
passing of the Resolution or, if earlier, the conclusion of the
next annual general meeting of TruFin;
(ii) Conversion to par value shares
convert all issued TruFin Ordinary Shares of no par value into
TruFin Ordinary Shares of GBP1.90 each;
(iii) Subdivision and redesignation
subdivide and redesignate all 97,368,421 TruFin Ordinary Shares
of GBP1.90 each to 97,368,421 TruFin New Ordinary Shares of GBP0.91
each and 97,368,421 DFC Cancellation Shares of GBP0.99 each
credited as fully paid;
(iv) Authority for TruFin Capital Reduction
approve the terms of the TruFin Reduction of Capital by the
cancellation of the DFC Cancellation Shares and the reduction of
the nominal capital account of TruFin;
(v) Authority to allot Redeemable Shares on a non pre-emptive
basis
dis-apply TruFin Shareholders' pre-emption rights in relation to
the allotment of the 50,000 Redeemable Shares to James van den
Bergh provided that such authority shall (subject to limited
exceptions), expire fifteen months from the passing of the
Resolution or, if earlier, the conclusion of the next annual
general meeting of TruFin; and
(vi) Amendment to memorandum and articles of association of
TruFin amend the memorandum and articles of association of TruFin
to reflect Resolutions 2(ii), (iii) and (iv).
(3) Resolution 3, which will be proposed as an ordinary
resolution, is to authorise the Directors to allot relevant
securities up to GBP29,535,088 in nominal value (representing
approximately one third of the share capital of the Company
following the TruFin Reduction of Capital) provided that such
authority shall (subject to limited exceptions), expire fifteen
months from the passing of the Resolution or, if earlier, the
conclusion of the next annual general meeting of TruFin.
(4) Resolution 4, which will be proposed as a special
resolution, is to dis-apply TruFin Shareholders' pre-emption rights
in relation to the allotment of equity securities for cash on a non
pre-emptive basis up to an aggregate nominal amount of GBP8,860,526
(representing 10% of the Company's issued share capital following
the TruFin Reduction of Capital) provided that such authority shall
(subject to limited exceptions), expire fifteen months from the
passing of the Resolution or, if earlier, the conclusion of the
next annual general meeting of TruFin.
Resolutions 3 and 4 are being sought by the Company to replace
its existing similar authorities obtained at its annual general
meeting on 19 June 2018 following the proposed conversion to par
value shares pursuant to Resolution 2(ii). There is currently no
intention to issue TruFin Ordinary Shares pursuant to these
Resolutions.
The Demerger is not conditional upon the passing of Resolutions
3 and 4.
TruFin Shareholders should read the Notice of General Meeting
that will be contained in the circular to be posted to shareholders
later today for the full text of the Resolutions and for further
details about the General Meeting.
10. Irrevocable Undertakings
Whilst Arrowgrass is supportive of the Demerger and Zopa
Transaction, given its involvement in the Demerger and Zopa
Transaction, it will abstain from voting on Resolution 1.
The Company has received an irrevocable undertaking to vote in
favour of Resolution 2 from Arrowgrass holding, in total,
71,684,544 TruFin Ordinary Shares, representing, in aggregate,
73.62% of the Company's issued ordinary share capital.
11. Importance of the vote and recommendation
If the Demerger Resolutions are not approved by TruFin
Shareholders and the Zopa Transaction does not complete, the TruFin
Board will be limited in its ability to implement the strategy of
either the TruFin Group or the DFC Group and there will be working
capital risks for the TruFin Group and the DFC Group. This could
have an adverse impact on the TruFin Group's and DFC Group's
respective businesses, reputation, financial condition and/or
operating results. Please refer to the risk factors in Part II for
further details.
The Directors consider that the Resolutions are in the best
interests of the Company and would promote the success of the
TruFin Group for the benefit of TruFin Shareholders as a whole.
Accordingly, the Directors unanimously recommend that TruFin
Shareholders vote in favour of the Resolutions to be proposed at
the General Meeting.
IMPORTANT NOTICES
No action has been taken by the Company, Macquarie or any of
their respective affiliates, agents, directors, officers or
employees that would permit an offer of the Sale Shares or
possession or distribution of this announcement or any other
offering or publicity material relating to such Sale Shares in any
jurisdiction where action for that purpose is required.
No prospectus will be made available in connection with the
matters contained in this announcement and no such prospectus is
required (in accordance with the Prospectus Directive) to be
published. Persons needing advice should consult an independent
financial adviser.
THIS ANNOUNCEMENT, INCLUDING THE APPICES AND THE INFORMATION
CONTAINED IN THEM, IS RESTRICTED AND IS NOT FOR PUBLICATION,
RELEASE OR DISTRIBUTION, DIRECTLY OR INDIRECTLY, IN WHOLE OR IN
PART, IN OR INTO OR FROM THE UNITED STATES, AUSTRALIA, CANADA,
JAPAN OR THE REPUBLIC OF SOUTH AFRICA OR ANY OTHER JURISDICTION IN
WHICH SUCH PUBLICATION, RELEASE OR DISTRIBUTION WOULD BE UNLAWFUL.
FURTHER, THIS ANNOUNCEMENT IS FOR INFORMATION PURPOSES ONLY AND IS
NOT AN OFFER OF SECURITIES FOR SALE OR SOLICITATION OF AN OFFER TO
BUY THE SECURITIES DISCUSSED HEREIN IN THE UNITED STATES,
AUSTRALIA, CANADA, JAPAN OR THE REPUBLIC OF SOUTH AFRICA OR IN ANY
JURISDICTION IN WHICH SUCH OFFER OR SOLICITATION IS UNLAWFUL. THIS
ANNOUNCEMENT HAS NOT BEEN APPROVED BY THE LONDON STOCK EXCHANGE,
NOR IS IT INTED THAT IT WILL BE SO APPROVED.
The securities referred to herein have not been and will not be
registered under the US Securities Act 1933, as amended (the
"Securities Act") or under the securities laws of any state or
other jurisdiction of the United States, and may not be offered or
sold directly or indirectly in or into 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 the securities laws of any state or any other
jurisdiction of the United States. No public offering of securities
is being made 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 Sale Shares and the Sale 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 or the Republic of South Africa.
Accordingly, the Sale 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.
This announcement is not being distributed by, nor has it been
approved for the purposes of section 21 of the Financial Services
and Markets Act 2000, as amended ("FSMA") by, a person authorised
under FSMA. This announcement is being distributed and communicated
to persons in the United Kingdom only in circumstances in which
section 21(1) of FSMA does not apply.
This announcement has been issued by and is the sole
responsibility of the Company. No representation or warranty,
express or implied, is or will be made as to, or in relation to,
and no responsibility or liability is or will be accepted by
Macquarie or by any of its affiliates or agents as to, or in
relation to, the contents of this announcement, including its
accuracy, completeness or verification or for any other statement
made or purported to be made by it, or on its behalf, the Company
or any other person in connection with the Company, the Zopa
Transaction, the Demerger, the Vendor Placing or DFC Holdings
Admission or for any other written or oral information made
available to or publicly available to any interested party or its
advisers, and any liability therefore is expressly disclaimed.
Nothing in this announcement should be read as a promise or
representation in this respect, whether or not to the past or the
future. Macquarie and its affiliates and agents disclaim to the
fullest extent permitted by law all and any responsibility or
liability whatsoever, whether arising in tort, contract or
otherwise, which it might otherwise have in respect of this
announcement or any such statement.
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. 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. The information contained in this announcement
is subject to change without notice and 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 statements are based.
Neither the content of the Company's website (or any other
website) nor the content of any website accessible from hyperlinks
on the Company's website (or any other website) is incorporated
into or forms part of this announcement.
This announcement contains inside information for the purposes
of Article 7 of EU Regulation 596/2014 ("MAR"). The person
responsible for arranging release of this information on behalf of
the Company is Henry Kenner, Executive Chairman. In addition,
market soundings (as defined in MAR) were taken in respect of the
Zopa Transaction, the Demerger and the Vendor Placing with the
result that certain persons became aware of inside information (as
defined in MAR), as permitted by MAR. This inside information is
set out in this announcement. Therefore, those persons that
received inside information in a market sounding are no longer in
possession of such inside information relating to the Company and
its securities.
Information to 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 MiFID II Product
Governance Requirements) may otherwise have with respect thereto,
the Sale Shares have been subject to a product approval process,
which has determined that the Sale Shares are: (i) compatible with
an end target market of retail investors and investors who meet the
criteria of professional clients and eligible counterparties, each
as defined in MiFID II; and (ii) eligible for distribution through
all distribution channels as are permitted by MiFID II (the "Target
Market Assessment"). Notwithstanding the Target Market Assessment,
distributors should note that: the price of the Sale Shares may
decline and investors could lose all or part of their investment;
the Sale Shares offer no guaranteed income and no capital
protection; and an investment in the Sale 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 Vendor Placing. Furthermore, it is
noted that, notwithstanding the Target Market Assessment, Macquarie
has only procured 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 Sale Shares.
Each distributor is responsible for undertaking its own target
market assessment in respect of the Sale Shares and determining
appropriate distribution channels.
PART A
EXPECTED TIMETABLE OF PRINCIPAL EVENTS
Event time and/or date 2019
-------------------------------------------------- ---------------
Date of this announcement 17 April
Latest time and date for receipt of Forms of 10.00 a.m. on 5
Proxy May
General Meeting 10.00 a.m. on 7
May
Completion of Zopa Transaction on 7 May
Latest time and date for lodging transfers of 5.00 p.m. on 8
TruFin Shares in order for the transferee to May
be registered at the Demerger Record Time
Demerger Record Time 5.00 p.m. on 8
May
Conversion, subdivision and redesignation of 6.00 p.m. on 8
the existing TruFin May
Ordinary Shares into the DFC Cancellation Shares
and TruFin New Ordinary Shares
Effective Date of the TruFin Reduction of Capital 11.00 p.m. on 8
May
Demerger Effective Time (issue of DFC Holdings 11.00 p.m. on 8
Demerger Shares) May
Estimated time and date for the admission of 8.00 a.m. on 9
the DFC Holdings Ordinary Shares to trading on May
AIM
CREST accounts credited with DFC Holdings Ordinary 8.00 a.m. on 9
Shares (including the Sale Shares) May
Expected date for despatch of definitive share By 16 May
certificates for DFC Holdings Ordinary Shares
(1) The times and dates set out in the expected timetable of
principal events above and mentioned throughout this announcement
may be adjusted by TruFin and DFC Holdings in consultation with
Macquarie, in which event details of the new times and dates will
be notified to the London Stock Exchange, and where appropriate,
TruFin Shareholders.
(2) All references in this announcement to times are to British
Summer Time unless otherwise stated.
PART B
TERMS AND CONDITIONS OF THE VOR PLACING
MEMBERS OF THE PUBLIC ARE NOT ELIGIBLE TO TAKE PART IN THE VOR
PLACING. THESE TERMS AND CONDITIONS ARE FOR INFORMATION PURPOSES
ONLY AND ARE DIRECTED ONLY AT: (A) PERSONS IN MEMBER STATES OF THE
EUROPEAN ECONOMIC AREA WHO ARE QUALIFIED INVESTORS AS DEFINED IN
SECTION 86(7) OF THE FSMA, AS AMED, ("QUALIFIED INVESTORS") BEING
PERSONS FALLING WITHIN THE MEANING OF ARTICLE 2(1)(E) OF THE EU
PROSPECTUS DIRECTIVE (WHICH MEANS DIRECTIVE 2003/71/EC AND INCLUDES
ANY RELEVANT MEASURE IN ANY MEMBER STATE OF THE EUROPEAN ECONOMIC
AREA) ("MEMBER STATE") THAT HAS IMPLEMENTED THE DIRECTIVE (THE
"PROSPECTUS DIRECTIVE"); (B) IN THE UNITED KINGDOM, QUALIFIED
INVESTORS WHO ARE PERSONS WHO: (I) FALL WITHIN ARTICLE 19(5) OF THE
FINANCIAL SERVICES AND MARKETS ACT 2000 (FINANCIAL PROMOTION) ORDER
2005 (THE "ORDER"); (II) FALL WITHIN ARTICLE 49(2)(A) TO (D) (HIGH
NET WORTH COMPANIES, UNINCORPORATED ASSOCIATIONS, ETC.) OF THE
ORDER; OR (III) ARE PERSONS TO WHOM IT MAY OTHERWISE BE LAWFULLY
COMMUNICATED (ALL SUCH PERSONS TOGETHER BEING REFERRED TO AS
"RELEVANT PERSONS"). THIS ANNOUNCEMENT AND THESE TERMS AND
CONDITIONS (THE "ANNOUNCEMENT") MUST NOT BE ACTED ON OR RELIED ON
BY PERSONS WHO ARE NOT RELEVANT PERSONS. ANY INVESTMENT OR
INVESTMENT ACTIVITY TO WHICH THESE TERMS AND CONDITIONS RELATE IS
AVAILABLE ONLY TO RELEVANT PERSONS AND WILL BE ENGAGED IN ONLY WITH
RELEVANT PERSONS.
Each Placee should consult with its own advisers as to legal,
tax, business and related aspects in relation to any acquisition of
Sale Shares.
(a) Introduction
These terms and conditions ("Terms and Conditions") apply to
persons making an offer to acquire Sale Shares under the Vendor
Placing. Each person to whom these conditions apply, as described
above, who confirms his agreement to Macquarie (whether orally or
in writing) to acquire Sale Shares under the Vendor Placing (each a
"Placee" and together, "Placees") hereby agrees with Macquarie,
Arrowgrass Master Fund Ltd ("Arrowgrass"), TruFin plc ("TruFin"),
the TruFin plc Employee Benefit Trust (the "TruFin EBT") and
Distribution Finance Capital Holdings Plc ("DFC Holdings" and
together with Macquarie, Arrowgrass, TruFin and TruFin EBT, the
"Beneficiaries") to be bound by the contract note issued by
Macquarie to such Placee and these Terms and Conditions, being the
terms and conditions upon which Sale Shares will be sold under the
Vendor Placing. A Placee shall, without limitation, become so bound
if Macquarie confirms to such Placee its allocation of Sale Shares
under the Vendor Placing.
Upon being notified of its allocation of Sale Shares in the
Vendor Placing, a Placee shall be contractually committed to
acquire the number of Sale Shares allocated to them at the Placing
Price and, to the fullest extent permitted by law, will be deemed
to have agreed not to exercise any rights to rescind or terminate
or otherwise withdraw from such commitment. Dealing may not begin
before any notification is made.
(b) Summary of the Vendor Placing
The Placing Price is 90 pence per Sale Share and the Vendor
Placing comprises the sale by Arrowgrass of 19,443,907 Sale Shares
and the sale by the TruFin EBT of 2,587,967 Sale Shares. All Sale
Shares sold pursuant to the Vendor Placing will be sold, payable in
full, at the Placing Price.
The Vendor Placing is subject to satisfaction of the conditions
set out in the Sale Agreement, including DFC Holdings Admission
occurring and becoming effective by no later than 8.00 am on 9 May
2019 or such later time and/or date as DFC Holdings and Macquarie
may agree, being not later than 8.00 am on 16 May 2019, and neither
the Sale Agreement nor the DFC Introduction Agreement having been
terminated in accordance with their respective terms.
Application will be made to the London Stock Exchange for the
DFC Holdings Ordinary Shares to be admitted to trading on AIM. It
is expected that DFC Holdings Admission will take place and
dealings in the DFC Holdings Ordinary Shares will commence on AIM
at 8.00 am (London time) on 9 May 2019.
The Sale Shares will rank pari passu in all respects with the
existing DFC Holdings Ordinary Shares and will rank in full for all
dividends and other distributions after DFC Holdings Admission
declared, made or paid on the ordinary share capital of DFC
Holdings. Further details of the rights attached to the Sale Shares
are set out in paragraph 3 of Part 4 of the pathfinder version of
the DFC Holdings Admission Document ("Pathfinder Admission
Document").
There will be no public offering of securities in the United
States. The Sale Shares have not been, and will not be, registered
under the US Securities Act or with any securities regulatory
authority of any state or other jurisdiction of the United States.
The Sale Shares may not be offered or sold, directly or indirectly,
in, into or within the United States or to or for the account or
benefit of any persons within the United States absent registration
or an exemption from registration under the US Securities Act.
Certain restrictions that apply to the distribution of the
Pathfinder Admission Document, this announcement and the Sale
Shares being sold under the Vendor Placing in jurisdictions outside
the United Kingdom are described in paragraph (c) below headed
"Selling and transfer restrictions".
(c) Selling and transfer restrictions
The distribution of the Pathfinder Admission Document, this
announcement and the offer of Sale Shares in certain jurisdictions
may be restricted by law and therefore persons into whose
possession this announcement and the Pathfinder Admission Document
comes should inform themselves about and observe any restrictions,
including those set out in the paragraphs that follow. Any failure
to comply with these restrictions may constitute a violation of the
securities laws of any such jurisdiction.
No action has been, or will be, taken in any jurisdiction that
would permit a public offering of the Sale Shares, or possession or
distribution of the Pathfinder Admission Document or this
announcement or any other offering material in any country or
jurisdiction where action for that purpose is required.
Accordingly, the Sale Shares may not be offered or sold, directly
or indirectly, and neither this announcement, nor the Pathfinder
Admission Document nor any other offering material or advertisement
in connection with the Sale Shares may be distributed or published,
in or from any country or jurisdiction except under circumstances
that will result in compliance with any and all applicable rules
and regulations of any such country or jurisdiction.
Neither this announcement nor the Pathfinder Admission Document
constitutes an offer or invitation to acquire, underwrite or
dispose of, or any solicitation of any offer or invitation to
acquire, underwrite or dispose of, any DFC Holdings Ordinary Shares
or other securities of DFC Holdings to any person in any
jurisdiction to whom it is unlawful to make such offer, invitation
or solicitation in such jurisdiction. Persons who seek to
participate in the Vendor Placing must inform themselves about and
observe any such restrictions and must be persons who are able to
lawfully receive this announcement and the Pathfinder Admission
Document in their jurisdiction. Any failure to comply with any such
restrictions may constitute a violation of the securities laws of
any such jurisdiction. Neither this announcement nor the Pathfinder
Admission Document constitutes an offer or invitation (or a
solicitation of any offer or invitation) to acquire, underwrite or
dispose of or otherwise deal in any DFC Holdings Ordinary Shares or
other securities of DFC Holdings in the United States, Australia,
Canada, the Republic of South Africa or Japan, or in any other
jurisdiction in which any such offer, invitation or solicitation is
or would be unlawful.
The Sale Shares have not been approved or disapproved by the US
Securities and Exchange Commission, any state securities commission
in the United States or any US regulatory authority, nor have any
of the foregoing authorities passed upon or endorsed the merits of
the offering of the Sale Shares or the accuracy or adequacy of this
announcement. Any representation to the contrary is a criminal
offence in the United States.
Members of the public are not eligible to take part in the
Vendor Placing.
Further details of the restrictions that apply to the
distribution of this announcement, the Pathfinder Admission
Document and the Sale Shares being sold under the Vendor Placing in
jurisdictions outside the United Kingdom are set out in the
"Important Information" section of the Pathfinder Admission
Document.
(d) Agreement to acquire Sale Shares
Each Placee will be deemed to have read these Terms and
Conditions in their entirety.
Conditional on: (i) DFC Holdings Admission occurring and
becoming effective by 8.00 am (London time) on 9 May 2019 (or such
later time and/or date as DFC Holdings and Macquarie may agree,
being not later than 8.00 a.m. on 16 May 2019); (ii) the Sale
Agreement and the DFC Introduction Agreement being otherwise
unconditional in all respects and neither having been terminated in
accordance with its respective terms on or before DFC Holdings
Admission; and (iii) the confirmation mentioned under paragraph (a)
above, a Placee agrees to become a member of DFC Holdings and
agrees to acquire Sale Shares at the Placing Price. The number of
Sale Shares acquired by such Placee under the Vendor Placing shall
be in accordance with the arrangements described above.
Participation in the Vendor Placing will only be available to
persons who may lawfully be, and are, invited to participate by
Macquarie. Macquarie and its affiliates may participate in the
Vendor Placing as principal.
An offer to acquire Sale Shares, which has been communicated by
a prospective Placee to Macquarie which has not been withdrawn or
revoked prior to publication of this announcement, will not be
capable of withdrawal or revocation immediately following the
publication of this announcement without the consent of
Macquarie.
Each Placee will have an immediate, separate, irrevocable and
binding obligation, owed to Macquarie, to pay in cleared funds
immediately on the settlement date, in accordance with the
registration and settlement requirements set out below, an amount
equal to the product of the Placing Price and the number of Sale
Shares allocated to such Placee. Macquarie will procure the
transfer of the Sale Shares to each Placee following each Placee's
payment to Macquarie of such amount.
Irrespective of the time at which a Placee's allocation pursuant
to the Vendor Placing is confirmed, settlement for all Sale Shares
to be acquired pursuant to the Vendor Placing will be required to
be made at all times and on the basis explained below.
To the fullest extent permissible by law, none of the
Beneficiaries, nor any of their respective affiliates, directors or
employees shall have any liability to Placees (or to any other
person whether acting on behalf of a Placee or otherwise) under
these Terms and Conditions. In particular, none of the
Beneficiaries nor any of their respective affiliates, shall have
any liability (including to the fullest extent permissible by law,
any fiduciary duties) in respect of Macquarie's conduct of the
Vendor Placing.
Macquarie is acting as agent for Arrowgrass and TruFin EBT and
no one else in connection with the Vendor Placing and will not
regard any person (whether or not a recipient of these Terms and
Conditions) as a client in relation to the Vendor Placing and to
the fullest extent permitted by law and applicable Financial
Conduct Authority rules, neither Macquarie nor any of its
affiliates will have any liability to Placees or to any person
other than Arrowgrass and TruFin EBT in respect of the Vendor
Placing.
(e) Allocation
Macquarie has solicited indications of interest from prospective
Placees to acquire DFC Holdings Ordinary Shares in the Vendor
Placing. On this basis, prospective Placees have been asked to
specify the number of DFC Holdings Ordinary Shares that they are
prepared to acquire at different prices. Multiple applications
under the Vendor Placing are permitted.
A number of factors have been considered in deciding the Placing
Price and the bases of allocation, including prevailing market
conditions, the level and the nature of the demand for DFC Holdings
Ordinary Shares, the objective of encouraging long--term ownership
of the DFC Holdings Ordinary Shares.
The Placing Price has been established at a level determined in
accordance with these arrangements, taking into account indications
of interest received from persons (including market--makers and
fund managers) connected with Macquarie. Accordingly, the Placing
Price may be lower than the highest price at which all of the DFC
Holdings Ordinary Shares, in respect of which indications of
interest have been received or which are available for subscription
or sale in the Vendor Placing, could have been accepted.
Placees will be advised verbally or by electronic mail of their
allocation as soon as practicable following allocation.
(f) Payment for Sale Shares
Each Placee undertakes to pay the Placing Price for the Sale
Shares acquired by such Placee in such manner as shall be directed
by Macquarie. In the event of any failure by a Placee to pay as so
directed by Macquarie, the relevant Placee shall be deemed hereby
to have appointed Macquarie or its nominee to sell (in one or more
transactions) any or all of the Sale Shares allocated to it and in
respect of which payment has not been made as so directed by
Macquarie and retain from the proceeds, for Macquarie's account and
benefit (as agent for Arrowgrass and TruFin EBT), an amount equal
to the aggregate amount owed by the Placee plus any interest due.
The Placee will, however, remain liable and indemnify on demand
Macquarie against any shortfall below the aggregate amount owed by
it and shall be liable for stamp duty and/or stamp duty reserve tax
or securities transfer tax (together with any interest or
penalties) (if any) arising in respect of any such sale or sales.
By agreeing to acquire Sale Shares, each Placee confers on
Macquarie all such authorities and powers necessary to carry out
any such sale and agrees to ratify and confirm all actions which
Macquarie lawfully takes in pursuance of such sale.
The DFC Holdings Ordinary Shares will be in registered form and
can be held in certificated or uncertificated form. Title to
certificated DFC Holdings Ordinary Shares (if any) will be
evidenced in the register of members of DFC Holdings and title to
uncertificated DFC Holdings Ordinary Shares will be evidenced by
entry into the operator register maintained by Equiniti Limited
(the "Registrar") (which will form part of the register of members
of DFC Holdings).
It is intended that allocations of Sale Shares to Placees who
wish to hold Sale Shares in uncertificated form will take place
through CREST on DFC Holdings Admission. It is intended that, where
applicable, definitive share certificates in respect of the Sale
Shares will be posted by first class post as soon as is practicable
following 16 May 2019 and will be sent at the relevant Placee's
risk in each case. Dealings in advance of the crediting of the
relevant CREST stock account shall be at the risk of the person
concerned. Prior to the despatch of definitive share certificates
in respect of any Sale Shares which are not settled in CREST,
transfers of those Sale Shares will be certified against the
register of members of DFC Holdings. No temporary documents of
title will be issued.
(g) Representations and warranties
By receiving this announcement, each Placee and, to the extent
applicable, any person confirming his agreement to acquire Sale
Shares on behalf of a Placee or authorising Macquarie to notify a
Placee's name to the Registrar, is deemed to acknowledge, agree,
undertake, represent and warrant to each of the Beneficiaries and
the Registrar that:
(i) the Placee has read this announcement in its entirety and
acknowledges that its participation in the Vendor Placing shall be
made solely on the terms and subject to the conditions set out in
these Terms and Conditions, the Sale Agreement and the articles of
association of DFC. Such Placee agrees that these Terms and
Conditions and the contract note issued by Macquarie to such Placee
represent the whole and only agreement between the Placee and the
Beneficiaries in relation to the Placee's participation in the
Vendor Placing and supersedes any previous agreement between any of
such parties in relation to such participation. Accordingly, all
other terms, conditions, representations, warranties and other
statements which would otherwise be implied (by law or otherwise)
shall not form part of these Terms and Conditions. Such Placee
agrees that none of the Beneficiaries, nor any of their respective
officers, directors, agents or employees will have any liability
for any such other information or representation and irrevocably
and unconditionally waives any rights it may have in respect of any
such other information or representation;
(ii) the Placee agrees that, having read this announcement and
the Pathfinder Admission Document, it shall be deemed to have had
notice of all information and representations contained in them,
that it is acquiring Sale Shares solely on the basis of this
announcement, the Pathfinder Admission Document, the final
admission document to published by DFC Holdings later on the date
of this announcement (the "Final Admission Document") and any
supplementary admission document which may be published by DFC
Holdings thereafter (as the case may be) and no other information
and that in accepting a participation in the Vendor Placing it has
had access to all information it believes necessary or appropriate
in connection with its decision to acquire Sale Shares;
(iii) the content of this announcement and the Pathfinder
Admission Document is exclusively the responsibility of TruFin,
TruFin EBT, DFC Holdings and its directors and that neither
Macquarie nor any person affiliated with Macquarie or acting on its
behalf is responsible for or shall have any liability for any
information, representation or statement contained in this
announcement, the Pathfinder Admission Document, the Final
Admission Document or any supplementary admission document (as the
case may be), or any information previously published by or on
behalf of TruFin, DFC Holdings or any member of their respective
groups and will not be liable for any decision by a Placee to
participate in the Vendor Placing based on any information,
representation or statement contained in any such documents or
otherwise;
(iv) the Placee acknowledges that no person is authorised in
connection with the Vendor Placing to give any information or make
any representation other than as contained in this announcement,
the Pathfinder Admission, the Final Admission Document and any
supplementary admission document published by DFC Holdings
subsequent to the date of this announcement and, if given or made,
any information or representation must not be relied upon as having
been authorised by the Beneficiaries;
(v) the Placee acknowledges that time shall be of the essence as
regards its obligations to settle payment for the Sale Shares and
to comply with its other obligations under the Vendor Placing;
(vi) the Placee has the funds available to pay the Placing Price
in respect of the Sale Shares for which it commits to acquire under
the Vendor Placing;
(vii) the Placee: (i) is entitled to acquire the Sale Shares
under the laws of all relevant jurisdictions; (ii) represents,
warrants and undertakes that none of the Beneficiaries will
infringe any laws outside the United Kingdom as a result of its
agreement to acquire Sale Shares or any actions arising from the
Placee's rights and obligations under the Placee's agreement to
acquire Sale Shares and under the articles of association of DFC;
(iii) has fully observed such laws; (iv) has the requisite capacity
and authority and is entitled to enter into and to perform its
obligations as an acquirer of Sale Shares and will honour such
obligations; and (v) has obtained all necessary consents and
authorities (including, without limitation, in the case of any
person on whose behalf it is acting, all necessary consents and
authorities to agree to the terms set out or referred to in this
paragraph to enable it to enter into the transactions contemplated
hereby and to perform its obligations in relation thereto and, in
particular, if the Placee is a pension fund or investment company,
it is aware of and acknowledges that it is required to comply with
all applicable laws and regulations with respect to its acquisition
of Sale Shares under the Vendor Placing;
(viii) the Placee has not relied on Macquarie or any person
affiliated with Macquarie in connection with any investigation of
the accuracy of any information contained in this announcement or
the Pathfinder Admission Document or its investment decision;
(ix) in agreeing to acquire Sale Shares under the Vendor
Placing, the Placee is relying on this announcement, the Pathfinder
Admission Document and the Final Admission Document or any
supplementary admission document (as the case may be) and not on
any draft thereof or other information or representation concerning
the Group, the Vendor Placing or the Sale Shares. Such Placee
agrees that none of the Beneficiaries, nor their respective
officers, directors, employees or agents will have any liability
for any such other information or representation and irrevocably
and unconditionally waives any rights it may have in respect of any
such other information or representation;
(x) Macquarie is not making any recommendations to Placees or
advising any of them regarding the suitability or merits of any
transaction they may enter into in connection with the Vendor
Placing, and each Placee acknowledges that participation in the
Vendor Placing is on the basis that it is not and will not be a
client of Macquarie and that Macquarie is acting as agent for
Arrowgrass and TruFin EBT and no one else, and Macquarie will not
be responsible to anyone for the protections afforded to its
clients (including Arrowgrass and TruFin EBT), and that Macquarie
will not be responsible for anyone (including Arrowgrass and TruFin
EBT) for providing advice in relation to the Vendor Placing, the
contents of this announcement or the Pathfinder Admission Document
or any transaction, arrangements or other matters referred to
therein, and Macquarie will not be responsible for anyone other
than the relevant parties to the Sale Agreement and the DFC
Introduction Agreement in respect of any representations,
warranties, undertakings or indemnities contained in the Sale
Agreement, the Introduction Agreement or for the exercise or
performance of Macquarie' rights and obligations thereunder,
including any right to waive or vary any condition or exercise any
termination right contained therein;
(xi) save in the event of fraud on its part (and to the extent
permitted by the rules of the Financial Conduct Authority), neither
Macquarie nor any of its directors or employees shall be liable to
a Placee for any matter arising out of the role of Macquarie as DFC
Holdings's nominated adviser and broker or otherwise, and that
where any such liability nevertheless arises as a matter of law
each Placee will immediately waive any claim against Macquarie and
any of its respective directors and employees which a Placee may
have in respect thereof;
(xii) the Placee has complied with all applicable laws and such
Placee will not infringe any applicable law as a result of such
Placee's agreement to acquire Sale Shares under the Vendor Placing
and/or acceptance thereof or any actions arising from such Placee's
rights and obligations under the Placee's agreement to acquire Sale
Shares under the Vendor Placing and/or acceptance thereof or under
the articles of association of DFC;
(xiii) all actions, conditions and things required to be taken,
fulfilled and done (including the obtaining of necessary consents)
in order: (i) to enable the Placee lawfully to enter into, and
exercise its rights and perform and comply with its obligations to
acquire the Sale Shares under the Vendor Placing; and (ii) to
ensure that those obligations are legally binding and enforceable,
have been taken, fulfilled and done. The Placee's entry into,
exercise of its rights and/or performance under, or compliance with
its obligations under the Vendor Placing, does not and will not
violate: (a) its constitutional documents; or (b) any agreement to
which the Placee is a party or which is binding on the Placee or
its assets;
(xiv) it understands that no action has been or will be taken in
any jurisdiction by the Beneficiaries or any other person that
would permit a public offering of the Sale Shares, or possession or
distribution of this announcement or the Pathfinder Admission
Document, in any country or jurisdiction where action for that
purpose is required;
(xv) if the Placee is in the United Kingdom: (i) it is a
Relevant Person and undertakes that it will acquire, hold, manage
or dispose of any Sale Shares that are allocated to it for the
purposes of its business; and (ii) it is acting as principal only
in respect of the Vendor Placing, or, if it is acting for any other
person: (a) it is and will remain liable to the Beneficiaries for
the performance of all its obligations as a Placee in respect of
the Vendor Placing (regardless of the fact that it is acting for
another person); (b) it is both an "authorised person" for the
purposes of FSMA and a "qualified investor" as defined at Article
2.1(e)(i) of the Prospectus Directive acting as agent for such
person; and (c) such person is either (1) a "qualified investor" or
(2) its "client" (as defined in section 86(2) of FSMA) that has
engaged it to act as the client's agent on terms which enable it to
make decisions concerning the Vendor Placing or any other offers of
transferable securities on his behalf without reference to the
client;
(xvi) if the Placee is in a Member State which has implemented
the Prospectus Directive, it is: (i) a legal entity which is a
"qualified investor" as defined under the Prospectus Directive;
and/or (ii) otherwise permitted by law to be offered and sold Sale
Shares in circumstances which do not require the publication by DFC
Holdings of a prospectus pursuant to Article 3 of the Prospectus
Directive or other applicable laws;
(xvii) if the Placee is in a Member State, in the case of any
Sale Shares acquired by it as a financial intermediary, as that
term is used in Article 3(2) of the Prospectus Directive: (x) the
Sale Shares acquired by it in the Vendor 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, as that term is defined in the
Prospectus Directive, or in other circumstances falling within
Article 3(2) of the Prospectus Directive and the prior consent of
Macquarie has been given to the offer or resale; or (y) where Sale
Shares have been acquired by it on behalf of persons in any
relevant Member State other than qualified investors, the offer of
those Sale Shares to it is not treated under the Prospectus
Directive as having been made to such persons. For the purposes of
this provision, the expression an "offer" in relation to any of the
Sale Shares in any relevant Member State means the communication in
any form and by any means of sufficient information on the terms of
the offer and any Sale Shares to be offered so as to enable an
investor to decide to purchase or acquire the Sale Shares, as the
same may be varied in that relevant Member State by any measure
implementing the Prospectus Directive in that relevant Member
State;
(xviii) to the fullest extent permitted by law, the Placee
acknowledges and agrees to the disclaimers contained in this
announcement and acknowledges and agrees to comply with the selling
restrictions set out in the "Important Information" section of the
Pathfinder Admission Document;
(xix) the Placee has not taken any action or omitted to take any
action which will or may result in DFC Holdings, Macquarie,
Arrowgrass or any of their respective directors, officers, agents,
affiliates, employees or advisers being in breach of the legal or
regulatory requirements of any territory in connection with the
Vendor Placing or its acquisition of Sale Shares pursuant to the
Vendor Placing;
(xx) the Sale Shares have not been and will not be registered
under the US Securities Act or under the securities legislation of,
or with any securities regulatory authority of, any state or other
jurisdiction of the United States or under the applicable
securities laws of Australia, Canada, Japan or the Republic of
South Africa or any other jurisdiction outside the United
Kingdom;
(xxi) the Placee is, and at the time the Sale Shares are
acquired, will be located outside the United States and eligible to
participate in an "offshore transaction" as defined in and in
accordance with Regulation S;
(xxii) DFC Holdings is not registered under the US Investment
Company Act and that DFC Holdings has put in place restrictions to
ensure that it is not and will not be required to register under
the US Investment Company Act;
(xxiii) the Placee is not acquiring the Sale Shares as a result
of any "directed selling efforts" as defined in Regulation S or as
a result of any form of "general solicitation" or "general
advertising" (each within the meaning of Rule 502(c) of Regulation
D under the US Securities Act);
(xxiv) if it is acquiring the Sale Shares for the account of one
or more other persons, it has full power and authority to make the
representations, warranties, agreements and acknowledgements herein
on behalf of each such account;
(xxv) the Placee is acquiring the Sale Shares for investment
purposes only and not with a view to any resale, distribution or
other disposition of the Sale Shares in violation of the US
Securities Act or any other securities laws of any state or other
jurisdiction of the United States;
(xxvi) DFC Holdings is not obliged to file any registration
statement in respect of any resales of the Sale Shares in the
United States with the US Securities and Exchange Commission or
with any securities administrator of any state or other
jurisdiction of the United States;
(xxvii) if in the future it decides to offer, sell, transfer,
assign or otherwise dispose of the Sale Shares, it will do so only
in compliance with an exemption from the registration requirements
of the US Securities Act and under circumstances with will not
require DFC Holdings to register under the US Investment Company
Act;
(xxviii) DFC Holdings, and any registrar or transfer agent or
other agent of DFC Holdings, will not be required to accept the
registration of transfer of any Sale Shares acquired by the Placee,
except upon presentation of evidence satisfactory to DFC Holdings
that the foregoing restrictions on transfer have been complied
with;
(xxix) the Placee invests in or purchases securities similar to
the Sale Shares in the normal course of its business and it has
such knowledge and experience in financial and business matters as
to be capable of evaluating the merits and risks of an investment
in the Sale Shares;
(xxx) the Placee has conducted its own investigation with
respect to DFC Holdings and the Sale Shares and has had access to
such financial and other information concerning DFC Holdings and
the Sale Shares as the Placee deemed necessary to evaluate the
merits and risks of an investment in the Sale Shares, and the
Placee has concluded that an investment in the Sale Shares is
suitable for it or, where the Placee is not acting as principal,
for any beneficial owner of the Sale Shares, based upon each such
person's investment objectives and financial requirements;
(xxxi) the Placee or, where the Placee is not acting as
principal, any beneficial owner of the Sale Shares, is able to bear
the economic risk of an investment in the Sale Shares for an
indefinite period and the loss of its entire investment in the Sale
Shares;
(xxxii) there may be adverse consequences to the Placee under
tax laws in other jurisdictions resulting from an investment in the
Sale Shares and the Placee has made such investigation and has
consulted such tax and other advisors with respect thereto as it
deems necessary or appropriate;
(xxxiii) the Placee is not located in or a resident of the
United States, Australia, Canada, Japan or the Republic of South
Africa or any other jurisdiction where the offer, sale or
acquisition of the Sale Shares would be unlawful and acknowledges
that the Sale Shares have not been and will not be registered nor
will a prospectus be prepared in respect of the Sale Shares under
the securities legislation of the United States, Australia, Canada,
Japan, the Republic of Ireland, the Republic of South Africa or any
other jurisdiction outside of the United Kingdom and, subject to
certain exceptions, the Sale Shares may not be offered or sold,
directly or indirectly, in or into those jurisdictions;
(xxxiv) the Placee is 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) wherever payable by it or any other
person on the acquisition by it of any Sale Shares or the agreement
by it to acquire any Sale Shares;
(xxxv) in the case of a person who confirms to Macquarie on
behalf of a Placee an agreement to acquire Sale Shares under the
Vendor Placing and/or who authorises Macquarie to notify such
Placee's name to the Registrar, that person represents that he has
authority to do so on behalf of the Placee;
(xxxvi) the Placee has complied with its obligations in
connection with money laundering and terrorist financing under the
Proceeds of Crime Act 2002, the Terrorism Act 2000 and the Money
Laundering, Terrorist Financing and Transfer of Funds (Information
on the Payer) Regulations 2017 ("Money Laundering Regulations
2017") and any other applicable law concerning the prevention of
money laundering and, if it is making payment on behalf of a third
party, that: (i) satisfactory evidence has been obtained and
recorded by it to verify the identity of the third party; and (ii)
arrangements have been entered into with the third party to obtain
from the third party copies of any identification and verification
data immediately on request as required by the Money Laundering
Regulations 2017 and, in each case, agrees that pending
satisfaction of such obligations, definitive certificates (or
allocation under the CREST system) in respect of the Sale Shares
comprising the Placee's allocation may be retained at Macquarie's
discretion;
(xxxvii) the Placee agrees that, due to anti--money laundering
and the countering of terrorist financing requirements, the
Beneficiaries may require proof of identity of the Placee and
related parties and verification of the source of the payment
before the application can be processed and that, in the event of
delay or failure by the Placee to produce any information required
for verification purposes, the Beneficiaries may refuse to accept
the application and the moneys relating thereto. The Placee holds
harmless and will indemnify the Beneficiaries against any
liability, loss or cost ensuing due to the failure to process this
application, if such information as has been required has not been
provided by it or has not been provided on a timely basis;
(xxxviii) the Placee is not, and is not applying as nominee or
agent for, a person which is, or may be, mentioned in any of
sections 67, 70, 93 and 96 of the Finance Act 1986 (depository
receipts and clearance services);
(xxxix) the Placee has complied with and will comply with all
applicable provisions of FSMA with respect to anything done by the
Placee in relation to the Vendor Placing in, from or otherwise
involving the UK;
(xl) if the Placee is in the UK, the Placee is a person: (i) who
has professional experience in matters relating to investments
falling within article 19(5) of the Order; or (ii) a high net worth
entity falling within article 49(2)(a) to (d) of the Order; or
(iii) to whom this announcement may otherwise be lawfully
communicated, and in all cases is capable of being categorised as a
Professional Client or Eligible Counterparty for the purposes of
the Financial Conduct Authority Conduct of Business Rules;
(xli) if the Placee is in the EEA, the person is a "Professional
Client" or an "Eligible Counterparty" within the meaning of Annex
ll/Article 30 of MiFID II (Directive 2014/65/EU) and is not
participating in the Vendor Placing on behalf of persons in the EEA
other than professional clients or persons in the UK and other
Member States (where equivalent legislation exists) for whom the
Placee has authority to make decisions on a wholly discretionary
basis;
(xlii) the Placee is aware of the obligations regarding insider
dealing in the Criminal Justice Act 1993, section 118 of FSMA and
the Proceeds of Crime Act 2002 and confirms that it has complied
and will continue to comply with those obligations;
(xliii) represents and warrants that its participation in the
Vendor Placing would not give rise to an offer being required to be
made by it or any person with whom it is acting in concert pursuant
to Rule 9 of the City Code on Takeovers and Mergers;
(xliv) in the case of a person who confirms to Macquarie on
behalf of a Placee an agreement to acquire Sale Shares under the
Vendor Placing and who is acting on behalf of a third party, that
the terms on which the Placee (or any person acting on its behalf)
are engaged enable it to make investment decisions in relation to
securities on that third party's behalf without reference to that
third party;
(xlv) the exercise by Macquarie of any rights or discretions
under the Sale Agreement or the DFC Introduction Agreement shall be
within its absolute discretion and Macquarie need not have any
reference to any Placee and shall have no liability to any Placee
whatsoever in connection with any decision to exercise or not to
exercise or to waive any such right and each Placee agrees that it
shall have no rights against Macquarie or any of its directors or
employees under the Sale Agreement or the DFC Introduction
Agreement;
(xlvi) it irrevocably appoints any director of Macquarie as its
agent for the purposes of executing and delivering to Arrowgrass,
TruFin, TruFin EBT, DFC Holdings and/or the Registrar any documents
on its behalf necessary to enable it to be registered as the holder
of any of the Sale Shares agreed to be taken up by it under the
Vendor Placing and otherwise to do all acts, matters and things as
may be necessary for, or incidental to, its acquisition of any Sale
Shares in the event of its failure so to do;
(xlvii) it will indemnify and hold the Beneficiaries, and their
respective affiliates and agents 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 paragraph (g) and further agrees that the
provisions of this paragraph (g) will survive after completion of
the Vendor Placing;
(xlviii) Macquarie may, in accordance with applicable legal and
regulatory provisions, engage in transactions in relation to the
Sale Shares and/or related instruments for its own account and,
except as required by applicable law or regulation, Macquarie will
not make any public disclosure in relation to such
transactions;
(xlix) Macquarie and each of its respective affiliates, each
acting as an investor for its or their own account(s), may bid for
and/or purchase Sale Shares and, in that capacity, may retain,
purchase, offer to sell or otherwise deal for its or their own
account(s) in the Sale Shares, any other securities of DFC Holdings
or other related investments in connection with the Vendor Placing
or otherwise. Accordingly, references in this announcement and the
Pathfinder Admission Document to the Sale Shares being offered,
acquired or otherwise dealt with should be read as including any
offer, acquisition or dealing by Macquarie and/or any of its
respective affiliates, acting as an investor for its or their own
account(s). None of the Beneficiaries intend to disclose the extent
of any such investment or transaction otherwise than in accordance
with any legal or regulatory obligation to do so;
(l) the Placee confirms that it is not and at DFC Holdings
Admission will not be, an affiliate of DFC Holdings or a person
acting on behalf of such affiliate and it is not acquiring Sale
Shares for the account or benefit of an affiliate of DFC Holdings
or of a person acting on behalf of such an affiliate;
(li) the Placee confirms that it will (or will procure that its
nominee will) if applicable, make notification to DFC Holdings of
the interest in its DFC Holdings Ordinary Shares in accordance with
Rule 5 of the DTRs as they apply to DFC Holdings;
(lii) the Placee accepts that the allocation of Sale Shares will
be determined by Macquarie in its absolute discretion following
consultation with Arrowgrass and TruFin EBT (as the case may be)
and that Macquarie may scale down any placing commitments on such
basis as it may determine;
(liii) the Placee acknowledges that the representations,
undertakings and warranties given by it as contained in the terms
and conditions, where relevant, are irrevocable; and
(liv) the Placee acknowledges that the Beneficiaries, and their
respective affiliates and agents will rely upon the truth and
accuracy of such representations, undertakings and warranties and
it agrees that if any of the representations, undertakings or
warranties made or deemed to have been made by its application for
Sale Shares are no longer accurate, it shall promptly notify the
Beneficiaries.
The Beneficiaries will rely upon the truth and accuracy of each
of the foregoing representations, warranties and undertakings.
(h) Supply and disclosure of information
If any of the Beneficiaries or the Registrar or any of their
respective agents request any information about a Placee's
agreement to acquire Sale Shares, such Placee must promptly
disclose it to them and ensure that such information is complete
and accurate in all respects.
(i) Miscellaneous
The rights and remedies of the Beneficiaries and the Registrar
under these terms and conditions are in addition to any rights and
remedies which would otherwise be available to each of them, and
the exercise or partial exercise of one will not prevent the
exercise of others.
(i) On application, each Placee may be asked to disclose, in
writing or orally to Macquarie:
1. if he is an individual, his nationality; or
2. if he is a discretionary fund manager, the jurisdiction in
which the funds are managed or owned.
(ii) All documents will be sent at the Placee's risk. They may
be sent by post to such Placee at an address notified to
Macquarie.
(iii) Each Placee agrees to be bound by the articles of
association of DFC (as amended from time to time) once the Sale
Shares which such Placee has agreed to acquire have been acquired
by such Placee.
(iv) The provisions of these Terms and Conditions may be waived,
varied or modified as regards specific Placees or on a general
basis by Macquarie.
(v) The contract to acquire Sale Shares and the appointments and
authorities mentioned herein will be governed by, and construed in
accordance with, the laws of England and Wales. For the exclusive
benefit of the Beneficiaries and the Registrar, each Placee
irrevocably submits to the exclusive jurisdiction of the English
courts in respect of these matters. This does not prevent an action
being taken against a Placee in any other jurisdiction.
(vi) In the case of a joint agreement to acquire Sale Shares,
references to a "Placee" in these terms and conditions are to each
of such Placees and such joint Placees' liability is joint and
several.
(vii) the Beneficiaries each expressly reserve the right to
modify the Vendor Placing (including, without limitation, its
timetable and settlement) at any time before allocations of Sale
Shares under the Placing are determined.
(viii) the Vendor Placing is subject to the satisfaction of the
conditions contained in the Sale Agreement and the DFC Introduction
Agreement and neither agreement having been terminated in
accordance with its terms on or prior to DFC Holdings Admission.
Further details of the terms of the Sale Agreement and the DFC
Introduction Agreement are contained in paragraphs 11 and 14,
respectively, of Part 4 of the Pathfinder Admission Document.
PART C
DEFINITIONS
In this announcement, where the context permits, the expressions
set out below shall bear the following meanings:
"Act" the Companies Act 2006
"AIM" the market of that name operated by the London
Stock Exchange
"AIM Rules" the AIM Rules for Companies setting out the
rules and responsibilities in relation to
AIM companies published by the London Stock
Exchange as amended from time to time
"AIM Rules for Nominated the AIM Rules for Nominated Advisers setting
Advisers" out the eligibility, ongoing obligations
and certain disciplinary matters in relation
to nominated advisers published by the London
Stock Exchange as amended from time to time
"Arrowgrass" Arrowgrass Master Fund Ltd
"Arrowgrass Sale" the conditional placing by Macquarie of the
Arrowgrass Sale Shares at the Placing Price
pursuant to and on the terms of the Sale
Agreement
"Arrowgrass Sale Shares" 19,443,907 DFC Holdings Ordinary Shares
"Articles". the articles of association of TruFin in
force at the date of this announcement
"Business Day" a day other than a Saturday or Sunday on
which banks are open for commercial business
in the City of London
"certificated" or "certificated the description of a share or other security
form" which is not in uncertificated form (that
is not in CREST)
"Circular" the circular to be posted to TruFin Shareholders
containing Notice of General Meeting
"Company" or "TruFin" TruFin plc, a company incorporated in Jersey
with registered number 125245
"Continuing TruFin Group" TruFin and its subsidiaries and subsidiary
undertakings following the Zopa Transaction
and completion of the Demerger, excluding
DFC and TruFin's interests in Zopa
"CREST" the relevant system (as defined in the CREST
Regulations) for paperless settlement of
share transfers and the holding of shares
in uncertificated form which is administered
by Euroclear UK & Ireland Limited
"CREST Manual" the compendium of documents entitled CREST
Manual issued by CRESTCo from time to time
and comprising the CREST Reference Manual,
the CREST Central Counterparty Service Manual,
the CREST International Manual, the CREST
Rules, CCSS Operations Manual, and the CREST
Glossary of Terms
"CREST Regulations" the Uncertificated Securities Regulations
2001 (SI 2001/3755) and the Companies (Uncertificated
Securities) (Jersey) Order 1999 as amended
from time to time, and any applicable rules
made under those regulations
"CREST Rules" the rules from time to time issued by CRESTCo
governing the admission of securities to
and the operation of the CREST UK System
"CREST UK System" the facilities and procedures of the relevant
systems of which CRESTCo is the Approved
Operator pursuant to the CREST Regulations
CRESTCo" Euroclear UK and Ireland Limited, the operator
of the CREST UK System or such other person
as may for the time being be approved by
HM Treasury as operator under the CREST Regulations
"Demerger" the proposed demerger of DFC from the TruFin
Group to be effected by way of a capital
reduction demerger on the terms and subject
to the conditions set out in the Demerger
Agreement
"Demerger Agreement" the agreement between, amongst others, TruFin,
DFC and DFC Holdings relating to the Demerger
entered into on 17 April 2019
"Demerger Effective Time" The time at which the Demerger becomes effective,
expected to be 11.00 p.m. on 8 May 2019
"Demerger Record Time" 5.00 p.m. on 8 May 2019
"Demerger Resolutions" the resolutions numbered 1 and 2 set out
in the Notice of General Meeting
"DFC" Distribution Finance Capital Limited, a company
incorporated in England and Wales with registered
number 10198535
"DFC Business" DFC's business of being a lender focused
on financing supply chains in the UK
"DFC Cancellation Shares" B ordinary shares of GBP0.99 each in the
capital of TruFin having the right to all
income and capital derived from TruFin's
holding of DFC Shares
"DFC EBT" the trustee of the employee benefit trust
of DFC
"DFC Group" DFC and, with effect from the Demerger Effective
Time, DFC Holdings and DFC
"DFC Holdings" Distribution Finance Capital Holdings plc
"DFC Holdings Admission" the admission to trading on AIM of the DFC
Holdings Ordinary Shares
"DFC Holdings Admission the document comprising an admission document
Document" relating to DFC Holdings for the purposes
of the DFC Holdings Admission (together with
any supplements or amendments thereto)
"DFC Holdings Board" the board of directors of DFC Holdings from
time to time
"DFC Holdings Demerger the 97,368,420 DFC Holdings Ordinary Shares
Shares" to be issued pursuant to the Demerger
"DFC Holdings Ordinary ordinary shares of one pence each in the
Shares" capital of DFC Holdings
"DFC Introduction Agreement" the conditional introduction agreement between
(i) Macquarie; (ii) DFC Holdings; (iii) the
DFC Holdings Board and (iv) the Company entered
into on 17 April 2019 in connection with
DFC Holdings Admission
"DFC Management Shareholders" Chris Dailey, Andrew Stafferton, Adrian Tilley,
David Burton, Desmond McNamara, Gavin Morris,
Paul Atherton, Philip Tarimo, Stephen Brown
and Steve Reynolds
"DFC Management Shares" The shares held by the DFC Management Shareholders,
TruFin EBT and DFT EBT in the capital of
DFC
"DFC Shares" A ordinary shares of GBP0.001 each in the
capital of DFC
"Directors" or "TruFin the directors of the Company
Board"
"Equity Book Value" GBP80 million, being the equity book value
of GBP55 million of DFC set out in the audited
accounts of DFC as at 31 December 2018 together
with the GBP25 million subscription into
DFC to be made by TruFin following the completion
of the Zopa transaction
"Form of Proxy" the form of proxy accompanying the Circular
for use in connection with the General Meeting
"FCA" the UK Financial Conduct Authority
"General Meeting" the general meeting (or any adjournment thereof)
of the TruFin Shareholders to be convened
pursuant to the Notice of General Meeting
set out at the end of this document
"HMRC" HM Revenue & Customs
"IFRS" International Financial Reporting Standards,
as adopted for use in the European Union
"London Stock Exchange" London Stock Exchange plc
"New Articles" the new articles of association of the Company
to be adopted pursuant to Resolution 2(vi)(a)
"Nominated Adviser", "Nomad" the Company's nominated adviser, Macquarie
or "Macquarie" Capital (Europe) Limited
"Notice of General Meeting" the notice convening the General Meeting
contained in the Circular
"Overseas Shareholders" TruFin Shareholders with registered addresses
outside the UK and Jersey or who are incorporated
in, registered in or otherwise resident or
located in, countries outside the UK and
Jersey
"Oxygen" Oxygen Finance Group Limited and its subsidiary
undertakings
"Placees" purchasers for the Sale Shares, as procured
by Macquarie pursuant to the Sale Agreement
"Placing Price" 90 pence per Sale Share
"PRA" Prudential Regulatory Authority
"Redeemable Shares" the 50,000 redeemable shares of GBP1 each
in the capital of the Company to be allotted
and issued as part of the Demerger
"Registrar of Companies" the Jersey Registrar of Companies
"Remuneration Committee" the remuneration committee of the TruFin
Board
"Resolutions" each of the resolutions which are set out
in the Notice of General Meeting
"Re-transfer Agreement" the re-transfer agreement entered into by
TruFin Holdings and Arrowgrass on 17 April
2019 in relation to the Zopa Transaction
"Sale Agreement" the conditional agreement dated 17 April
2019 between (i) Macquarie; (ii) the TruFin
EBT; (iii) Arrowgrass and (iv) DFC Holdings
relating to the
TruFin EBT Sale and the Arrowgrass Sale
"Sale Shares" the Arrowgrass Sale Shares and the TruFin
EBT Shares
"Satago" Satago Financial Solutions Limited and its
subsidiary undertakings
"SDRT" stamp duty reserve tax
"Share Exchange" the exchange of the shares held in DFC by
DFC Management, the TruFin EBT and the DFC
EBT for 9,273,505 DFC Holdings Ordinary Shares
in accordance with the Subscription and Share
Exchange Agreement
"Subscription and Share the subscription and share exchange agreement
Exchange Agreement" dated 17 April 2019 between the DFC Management
Shareholders, TruFin EBT, DFC EBT, DFC and
DFC Holdings relating to a subscription for
new A ordinary shares in DFC and the Share
Exchange
"subsidiary" has the meaning given in section 1159 of
the Act
"subsidiary undertaking" has the meaning given in section 1162 of
the Act
"TruFin" Admission" admission of the entire issued share capital
of TruFin to trading on AIM on 21 February
2018
"TruFin Admission Document" the document dated 13 February 2018 and published
by TruFin in connection with TruFin Admission
"TruFin EBT" the trustee of the TruFin Employee Benefit
Trust
"TruFin EBT Sale" the conditional placing by Macquarie of the
TruFin EBT Sale Shares at the Placing Price
pursuant to and on the terms of the Sale
Agreement
"TruFin EBT Sale Shares" 2,587,967 DFC Holdings Ordinary Shares
"TruFin Group" in respect of any period prior to the Demerger
Effective Time, TruFin and its subsidiaries
and subsidiary undertakings (including DFC
but excluding TruFin's interests in Zopa
following the Zopa Transaction and, in respect
of any period following the Demerger Effective
Time, the Continuing TruFin Group
"TruFin Holdings". TruFin Holdings Limited, a wholly-owned subsidiary
of the Company
"TruFin Management Team" Henry Kenner, James van den Bergh, Raxita
Kapashi and Jason Rogers
"TruFin New Ordinary Shares" ordinary shares of GBP0.91 each in the capital
of TruFin following the conversion to par
value, subdivision and redesignation pursuant
to Resolution 2
"TruFin Ordinary Shares" the existing ordinary shares of no par value
each in the capital of TruFin
"TruFin Reduction of Capital". the proposed reduction of capital by TruFin
by the cancellation of the DFC Cancellation
Shares and the reduction of TruFin's nominal
capital account
"TruFin Share Register" the register of members of the Company
"TruFin Shareholders" the holders from time to time of TruFin Ordinary
Shares or TruFin New Ordinary Shares, as
applicable
"Vendor Placing" the placing of the Sale Shares by Macquarie
with Placees pursuant to the terms and conditions
set out in part B of this announcement
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
UPDFMGMDFNRGLZM
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