TIDMURA
RNS Number : 3158Y
Uranium Resources PLC
04 December 2017
4 December 2017
Uranium Resources plc
("Uranium Resources" or "the Company")
Proposed Disposal of the Mtonya Project
Share Capital Reorganisation
Proposed Placing to Raise GBP900,000
Appointment of Proposed Directors
Proposed Change of Name
Notice of General Meeting
Uranium Resources is pleased to announce that it has agreed
conditionally to dispose of the Mtonya Project ("Mtonya") to its
majority shareholder Estes Limited ("Estes") and to the subsequent
reorganisation and recapitalisation of the Company which will
become an AIM Rule 15 cash shell. As part of the Proposals, the
Company is raising GBP900,000 in new equity and a number of key
board changes are taking place. Please see the Share Capital
Statistics below for further information on the reorganisation.
Disposal
Subject to shareholder approval, the Company will dispose of
Mtonya to Estes, in partial settlement of the outstanding loans of
approximately US$2.07 million from Estes to the Company (the
"Disposal"). The partial settlement is in the amount of US$1.2
million, a valuation which is 25 per cent. higher than the top of
the fair market range provided by independent consultants for
Mtonya. In addition, it is proposed that Estes will capitalise the
remaining debt owed to it by the Company of US$870,000 at a price
of 0.5p per share.
The Disposal constitutes a fundamental change of business in
accordance with the AIM Rules and is therefore subject to
shareholder approval. Alex Gostevskikh, Andrew Lewis and James
Pratt (the "Independent Directors") are supportive of the Disposal
on the basis that Estes has informed the Company that it is no
longer willing to provide financial support to it and the Disposal
provides a return to the Company significantly higher than the
third party valuation of the Mtonya Project. The Independent
Directors also believe that significant funds would be required to
undertake a meaningful drilling programme at Mtonya and that such
early stage exploration projects are difficult to fund, especially
as the market for uranium remains depressed. The Independent
Directors intend to vote in favour of the resolutions as a
whole.
Share Capital Reorganisation and Placing
The Company is proposing to undertake a Share Capital
Reorganisation (as described more fully below) which will result in
59,788,833 New Ordinary Shares being in issue following the post
the Disposal and capitalisation of the Estes loan balance.
Following the Share Capital Reorganisation 7,777,778 New Ordinary
will be issued to pursuant to the Director Capitalisations
resulting in 67,566 611 New Ordinary Shares being in issue
immediately prior to the Placing.
The Company has conditionally raised GBP900,000 at 0.45p, via
the placing of 200,000,000 New Ordinary Shares through Peterhouse
Corporate Finance Limited, together with a 1 for 2 attaching
warrant (the "Placing Warrants"). The Placing Warrants are
exercisable at 0.9p per New Ordinary Share, three months from the
date of grant and for a period of 12 months from the date of grant
or until the Company completes a transaction which constitutes a
reverse takeover in accordance with AIM Rule 14 (the "Final
Exercise Date") whichever is earlier.
Peterhouse Corporate Finance Limited will be appointed as joint
broker to the Company subject to Shareholders' approval of the
Proposals.
Subject to Shareholder approval, admission of the New Ordinary
Shares to trading on AIM is expected on or around 21 December 2017
and the Company's name will change to URA Holdings plc (the TIDM
will remain URA). Under the Proposals the Enlarged Share Capital
will comprise 267,566,611 New Ordinary Shares of 0.15p each.
In order to provide existing shareholders with some ability to
subscribe should they so choose on the same terms as the Placing
Warrants, the Board proposes subject to regulatory prohibitions
relating to marketing securities in certain jurisdictions, to issue
new warrants to existing shareholders on the record date on a pro
rata basis of one Bonus Warrant for every two New Ordinary Shares
held (the "Bonus Warrant Issue") at an exercise price of 0.9p per
share.
Board Changes and New Strategy
Conditional on the passing of the Resolutions, it is proposed
that the Existing Directors, with the exception of Alex
Gostevskikh, step down from the Board and that Peter Redmond and
Melissa Sturgess are appointed directors (the "Proposed
Directors"). Peter and Melissa have many years of experience as
directors of AIM companies and intend that the new strategy of the
Company will be to acquire a substantial business that is seeking
an AIM quoted platform. Peter has been involved in the
restructuring of a number of AIM quoted companies and Melissa most
recently spearheaded the recapitalisation of Messaging
International plc and subsequent creation of SigmaRoc plc.
The Proposed Directors will be uncommitted in relation to sector
but will focus on an acquisition that can create significant value
for shareholders in the form of capital growth and/or dividends.
The net use of proceeds from the Placing will be used for general
working capital purposes and to investigate suitable acquisition
opportunities.
Subject to the passing of all the Resolutions, Peter Redmond and
Melissa Sturgess will be interested in 4.2 per cent. and 8.3 per
cent. respectively of the Enlarged Share Capital.
Share Capital Statistics
Existing Ordinary Shares in issue
as at the date of the Document 757,632,495
Nominal value of Existing Ordinary
Shares 0.1p
Enlarged Share Capital following
the capitalisation of the Estes
loan balance 896,832,495
New Ordinary Shares in issue following
the Share Capital Reorganisation 59,788,833
Nominal value of New Ordinary Shares
following the Share Capital Reorganisation 0.15p
New Ordinary Shares to be issued
pursuant to the Director Capitalisations 7,777,778
Placing Price of the New Ordinary
Shares 0.45p
New Ordinary Shares to be issued
pursuant to the Placing 200,000,000
Gross proceeds of the Placing GBP900,000
Estimated net proceeds of the Placing GBP840,000
Enlarged Share Capital following
the Share Capital Reorganisation,
Capitalisation and Placing 267,566,611
Market capitalisation of the Company GBP1,204,050
at the Placing Price following the
Share Capital Reorganisation, the
Capitalisation and the Placing
Placing Shares as a percentage of
the Enlarged Share Capital 74.4%
Fully diluted number of New Ordinary
Shares in issue following the Proposals
set out in this Document* 424,217,688
*Assuming exercise of the Bonus Warrants, Placing Warrants and
options granted under the Share Option Plan
The Disposal and the Placing are included in a set of proposals
(the "Proposals") that are set out in a circular ("Circular") which
is being sent to shareholders today. The Circular also sets out why
the Existing Directors recommend that Shareholders vote in favour
of the Resolutions to be proposed at the General Meeting which is
to be held at the offices of Shakespeare Martineau LLP, 6(th)
Floor, 60 Gracechurch Street, London EC3V OHR, at 12.00 p.m. on 20
December 2017.
Alex Gostevskikh, Managing Director and Executive Chairman,
commented:
"As previously communicated to shareholders, the uranium market
continues to see depressed prices which has constrained the Board's
ability to raise significant new funds. The proposed transaction to
dispose of the Mtonya Project to Estes will allow the Company to
introduce new funds, appoint new directors, and look to adopt a new
strategy to create significant value for shareholders via
acquisitions while remaining on AIM."
Following Completion, the Company will be classified as an AIM
Rule 15 cash shell and as such will be required to make an
acquisition or acquisitions which constitutes a reverse takeover
under AIM Rule 14 (including seeking re-admission as an investing
company (as defined under the AIM Rules)) on or before the date
falling six months from completion of the Disposal or be
re-admitted to trading on AIM as an investing company under the AIM
Rules (which requires the raising of at least GBP6 million) failing
which, the Company's New Ordinary Shares would then be suspended
from trading on AIM pursuant to AIM Rule 40. Admission to trading
on AIM would be cancelled six months from the date of suspension
should the reason for the suspension not have been rectified.
Key sections of the Circular are reproduced below. Capitalised
terms not otherwise defined, shall have the same meanings as set
out in the Circular.
This announcement contains inside information for the purposes
of Article 7 of Regulation (EU) 596/2014.
Alex Gostevskikh Uranium Resources Tel: +1 778 938-7631
plc
Matthew Johnson Northland Capital Tel: +44 (0)203
/ David Hignell Partners Ltd 861 6625
Lucy Williams Peterhouse Corporate Tel: +44 (0)207
/ Heena Karani Finance Ltd 469 0931
Jos Simson Tavistock (Financial Tel: +44 (0)207
/ Annabel and Investor Relations) 920 3150
de Morgan
Background to the Proposals
The Company was incorporated on 11 January 2005 and its shares
were admitted to trading on AIM on 18 February 2005. The Company's
strategy was to make investments in the mining and minerals sectors
and specifically in the uranium sector.
On 3 April 2012, Uranium Resources announced it had raised
GBP3.93 million (gross) through a Placing of 163,750,000 new
ordinary shares of 0.1 pence each in the Company at a price of 2.4
pence per ordinary share. The funds raised were used to support the
development of the Mtonya Project located 100 kilometres east of
Songea in southern Tanzania. As a consequence of the placing, the
Company's major shareholder, Estes, increased its holding in the
Company to 56 per cent. of the issued share capital. At this time
the Company was not subject to the UK Takeover Code.
On 26 March 2013 the Company entered into a US$1 million loan
agreement with Estes to fund working capital requirements pending
the publication of its maiden mineral resource estimate at
Mtonya.
On 3 May 2013 the Company announced that it had completed a
maiden CIM-compliant Mineral Resource estimate for Mtonya. The
Mineral Resource Estimate was prepared by Roscoe Postle Associates
Inc. of Toronto, Ontario. The CIM Inferred Resource estimate was
3.6 million tonnes at 255 ppm U3O8 containing 2.0 Mlb U3O8. The
resource estimate was based on 159 diamond drillholes (38,591m)
completed by the Company in 2010 to 2012. Only assays of drill core
samples were used in the resource estimate. The Directors expect
that the resource will be amenable ISR, the most-cost effective and
environmentally-acceptable method of uranium extraction.
The market for uranium has been depressed since the Fukushima
disaster in Japan in 2011 following which many countries reassessed
or cancelled their nuclear power programmes. The market has
remained subdued and the Directors do not believe the price of
uranium will return to higher levels in the near term.
Notwithstanding this, the Directors believed the potential
low-cost extraction of uranium at Mtonya via ISR would mean that
the project could be developed economically should the market for
U3O8 improve. However, given the state of the uranium market, no
further drilling activity was undertaken at Mtonya and the Company
focused on evaluating the existing exploration work and also began
discussions with a potential strategic partner with a uranium
exploration project in Tanzania. In order to fund the Company's
ongoing working capital requirements, and avoid dilution for
Shareholders, the Company entered into a series of loans with Estes
which continued to support the Company financially.
On 5 July 2017, the Company announced that Estes, which
currently holds 55.1 per cent. of the issued share capital,
remained supportive of the Company and would fund ongoing working
capital requirements while the Company reviewed alternative
financial arrangements.
The Directors believe that the Mtonya licence requires
significant additional funds to undertake further exploration
drilling to increase the size of the resource and consider that
such a drilling programme cannot be justified given the current
depressed uranium market. In addition, the Directors do not believe
that such a significant equity fundraise would be achievable
without offering a large discount to the current share price. Estes
has also informed the Board that it is unwilling to continue
lending the Company funds for working capital purposes. However it
has indicated that it would be willing to acquire Mtonya in partial
settlement of the debt owed to Estes by the Company. The partial
settlement will be in the amount of US$1.2 million. In addition,
Estes is also willing to capitalise the remaining debt owed to it
by the Company of US$870,000 at a price of 0.5p per Share.
The Board is therefore faced with a situation where it could
propose to seek cancellation of the Company's AIM admission to AIM,
but then there would effectively be no market in the Existing
Ordinary Shares, and without financial support from Estes, the
Directors would have to consider placing the Company into
administration or, and as proposed in this Circular, the Board
could dispose of Mtonya, introduce new funds, appoint new
directors, and look to adopt a new strategy.
Having considered these alternatives at length with a number of
its advisers, the Board has concluded that the best available
option is to dispose of Mtonya to Estes, recapitalise the Company
and introduce new directors.
The Disposal and Related Party Transaction
The Disposal will take place in the form of the transfer of,
inter alia, the entire issued share capital of the Subsidiaries by
the Company to Estes for a consideration of US$1.2 million in
partial settlement of the debt owed to it by the Company. The
Directors believe this is an attractive offer as it is 25 per cent.
higher than the top of the fair market range provided in the Micon
report.
The Transfer Agreement contains basic warranties as to capacity
and authority and title from the Company and no other warranties.
The Transfer Agreement also contains an indemnity from Estes to the
Company in relation to any liability arising as a result of the
Transfer.
Under AIM Rule 15, the Disposal constitutes a fundamental change
of business of the Company. On Completion, the Company would cease
to own, control or conduct all or substantially all, of its
existing trading business, activities or assets and would therefore
become an AIM Rule 15 cash shell.
The Disposal is also a related party transaction under AIM Rule
13 as Estes is a substantial shareholder in the Company.
The Independent Directors consider, having consulted with
Northland (the Company's nominated adviser), that the terms of the
Disposal are fair and reasonable insofar as the Company's
Shareholders are concerned. The Independent Directors have taken
into account the following:
1. the continuing depressed state of the uranium market;
2. the significant funds required to undertake a meaningful
drilling programme at the Mtonya Project to expand the
resource;
3. the lack of appetite amongst investors to fund early stage
exploration projects such as Mtonya in the present market
conditions;
4. the indication from Estes that it will no longer fund the
ongoing working capital requirements of the Company and the likely
administration of the Company if no alternative funding is
secured;
5. the independent third-party valuation report by Micon;
6. the favourable transaction terms offered by Estes which
represent a significant premium to the top of the fair market range
provided in the Micon report; and
7. the willingness of Estes to capitalise its remaining loan
balance at a price of 0.5p per Share.
Following Completion, the Company will be classified as an AIM
Rule 15 cash shell and as such will be required to make an
acquisition or acquisitions which constitutes a reverse takeover
under AIM Rule 14 (including seeking re-admission as an investing
company (as defined under the AIM Rules)) on or before the date
falling six months from Completion or be re-admitted to trading on
AIM as an investing company under the AIM Rules (which requires the
raising of at least GBP6 million) failing which, the Company's New
Ordinary Shares would then be suspended from trading on AIM
pursuant to AIM Rule 40. Admission to trading on AIM would be
cancelled six months from the date of suspension should the reason
for the suspension not have been rectified.
Capitalisation of remaining Estes loan balance and amounts owed
to Existing Directors
As at the date of the General Meeting, Estes will be owed a
total of US$2,070,000. This consists of four fully drawn down loans
and associated accrued interest and an additional loan from Estes
of approximately US$25,000. Following the Disposal, Estes will be
owed US$870,000. Estes has agreed with the Company to capitalise
the balance owed to it into Existing Ordinary Shares at a price of
approximately 0.5p per Share. As a result Estes will be issued with
139,200,000 Existing Ordinary Shares.
As at 11 December 2017, Existing Directors of the Company Alex
Gostevskikh and James Pratt will be owed outstanding salaries/fees
of GBP312,000 and GBP9,014 respectively. Mr Gostevskikh and Mr
Pratt have agreed to write off approximately 90 per cent. and 45
per cent. of the fees owed to them such that the Company will owe
them GBP30,000 and GBP5,000 respectively and these amounts will be
converted into New Ordinary Shares at the Placing Price following
the Share Capital Reorganisation. As a result Mr Gostevskikh and Mr
Pratt will be issued with 6,666,667 and 1,111,111 New Ordinary
Shares respectively.
Estes and Alex Gostevskikh have agreed that they will not, save
in certain circumstances, during the three months following
Completion directly or indirectly transfer, sell or otherwise
dispose of, or enter into any agreement to do the same, in respect
of the legal or beneficial ownership of their New Ordinary Shares.
They also undertake that for the period between three and six
months after Completion they shall only transfer, sell or otherwise
dispose of, or enter into any agreement to do the same through
Peterhouse. In addition, James Pratt has agreed that, for a period
of six months after Completion, he shall only transfer, sell or
otherwise dispose of the legal or beneficial ownership of his New
Ordinary Shares, or enter into any agreement to do the same through
Peterhouse.
Placing and Bonus Warrant Issue
In order to recapitalise the Company, Peterhouse and the
Proposed Directors have conditionally raised GBP900,000 at 0.45p
per Placing Share, through the placing of 200,000,000 New Ordinary
Shares representing 74.7 per cent of the Enlarged Share Capital
following approval of the Share Capital Reorganisation and
Completion. The Placing Shares will be issued following and
conditional upon the passing of the Resolutions.
Following completion of the Proposals, the Company will be an
AIM Rule 15 cash shell with cash of approximately GBP840,000 net of
commission to brokers and other transaction costs.
In order to provide existing shareholders with some ability to
subscribe should they so choose on the same terms as the Placing
Warrants, the Board proposes subject to regulatory prohibitions
relating to marketing securities in certain jurisdictions, to issue
new warrants to Qualifying Shareholders on the record date on a pro
rata basis of one Bonus Warrant for every two New Ordinary Shares
held (the "Bonus Warrant Issue") at an exercise price of 0.9p per
share. Further terms of the proposed Bonus Warrant Issue are set
out below.
Proposed Directors Upon Completion of the Disposal
Subject to the Resolutions being passed, it is proposed that
Peter Redmond and Melissa Sturgess join the Board as Chairman and
Executive Director respectively. All of the Existing Directors,
with the exception of Alex Gostevskikh will resign from office upon
passing of the Resolutions with no compensation for loss of office,
and will waive all claims against the Company under their
appointment letters.
Peter Redmond - Chairman
Peter Redmond is a corporate financier with over 30 years of
experience in corporate finance and venture capital. He has acted
on and assisted a wide range of companies to attain a listing over
many years on the Unlisted Securities Market, the Main Market of
the London Stock Exchange and AIM, whether by IPO or in many cases
via reverse takeovers, across a wide range of sectors, ranging from
technology through financial services to natural resources and, in
recent years has done so as a director of the companies concerned.
He was a founder director of Cleeve Capital plc (now Satellite
Solutions Worldwide Group plc) and Mithril Capital plc (now Be
Heard Group plc), both listed on AIM, and took a leading role in
the reconstruction and refinancing of AIM-quoted Kennedy Ventures
plc and 3Legs Resources plc (now SalvaRx Group plc). He is a
director of Hemogenyx plc and Pires Investments plc.
Melissa Sturgess - Executive Director
Melissa Sturgess holds a BSc and an MBA and has many years of
experience as a director of AIM and ASX quoted companies. She was
most recently a key driver in the successful recapitalisation of
Messaging International plc during 2016 which subsequently changed
its name to SigmaRoc Plc, acquired a building materials business
via a reverse takeover and raised GBP50 million from a range of
investors in the Channel Islands and the UK.
Share Capital Reorganisation
Under the Companies Act, the Company is not able to raise funds
at the Placing Price. The Company is therefore proposing to
undertake the Share Capital Reorganisation so that it can raise
further equity capital via the Placing at the Placing Price.
The Share Capital Reorganisation will be achieved through the
subdivision of each Existing Ordinary Share of 0.1p into one
ordinary share of 0.01p and one Deferred Share of 0.09p.
Following the subdivision the ordinary shares of 0.01p will be
consolidated on a 15 for 1 basis to create New Ordinary Shares.
Therefore following the Disposal and Share Capital Reorganisation
there will be 59,788,833 New Ordinary Shares in issue of 0.15p
each.
The rights attaching to the New Ordinary Shares will be
identical in all respects to those of the Existing Ordinary
Shares.
If the Proposals are approved, the New Ordinary Shares will
trade under the new name of the Company. New share certificates
will be issued to Shareholders holding share certificates as a
result of the Company's name change and Share Capital
Reorganisation. Share certificates will be sent by second class
post at the risk of the Shareholder.
The Placing
The Existing Directors and Proposed Directors have agreed that,
following the Disposal and the capitalisation of the balance of the
loans owed to Estes, the value of the Company will be
GBP300,000.
Conditional upon the approval of the Proposals at the General
Meeting, Peterhouse and the Proposed Directors have placed
200,000,000 New Ordinary Shares at a price of 0.45p raising
GBP900,000 before expenses of approximately GBP60,000, together
with a 1 for 2 attaching warrant (the "Placing Warrants")
exercisable at 0.9p per New Ordinary Share, three months from the
date of grant and for a period of 12 months from the date of grant
or until the Company completes a transaction which constitutes a
reverse takeover in accordance with AIM Rule 14 (the "Final
Exercise Date") whichever is earlier. If any of the Placing
Warrants remain unexercised on the Final Exercise Date, they will
expire.
It is expected that the New Ordinary Shares will be admitted to
trading on AIM on or around 21 December 2017. The Placing Warrants
will not be traded on AIM or any other public market, and will be
issued on the same terms and conditions as the Bonus Warrants as
set out below.
Additionally, conditional on the Proposals being approved by
Shareholders at the General Meeting, the Company has agreed to
issue Northland and Peterhouse an option to subscribe for New
Ordinary Shares at the Placing Price equal to 1 per cent. of the
Enlarged Share Capital of the Company, exercisable at the Placing
Price for up to five years.
Bonus Warrant Issue
The Board proposes that a bonus issue of warrants will be made
to the existing shareholders of the Company. Accordingly, the
record date for the Bonus Warrant Issue is 4.30 p.m. on 20 December
2017.
One Bonus Warrant is proposed to be issued for every two New
Ordinary Shares held by Qualifying Shareholders (subject to certain
regulatory restrictions referred to below). Based on the issued
share capital of 59,233,921 New Ordinary Shares, the Company would
therefore issue a maximum of 29,616,961 Bonus Warrants. The Bonus
Warrants would represent approximately 11.2 per cent. of the
Enlarged Share Capital prior to exercise.
The Bonus Warrants, which will not be traded on AIM or any other
public markets, will be eligible for exercise from three months
from date of grant for a period of 12 months from the date of grant
or until the Company completes a transaction which constitutes a
reverse takeover in accordance with AIM Rule 14 (the "Final
Exercise Date"). If any of the Bonus Warrants remain unexercised on
the Final Exercise Date, they will expire. The exercise price of
the Bonus Warrants will be 0.9p per New Ordinary Share.
The instrument constituting the Bonus Warrants will contain
other provisions typically found in such instruments, including
those relating to the adjustment of the terms of the Bonus
Warrants, protections for holders of Warrants and the procedures
for the modification of the rights of the Bonus Warrants. Following
the issue of the Bonus Warrants, a copy of the instrument
constituting them will be available to download from the Investor
Relations section of the Company's website:
www.uraniumresources.co.uk.
The Bonus Warrants will be subject to eligibility requirements
on issue. Such requirements result from pre-existing securities law
restrictions applicable to certain jurisdictions such as the United
States of America. The Bonus Warrant Issue will not be extended to,
and the Bonus Warrants will not be issued to and may not
subsequently be exercisable by, shareholders in a restricted
jurisdiction. Notwithstanding the above, the Company will reserve
the right to permit any shareholder to take up Bonus Warrants under
the Bonus Warrant Issue if the Company, in its sole and absolute
discretion, is satisfied that the transaction in question is exempt
from, or not subject to, the applicable restrictive legislation or
regulations.
The Directors (save for James Pratt) and Estes will not exercise
their right to take up their entitlement under the Bonus Warrant
Issue.
Change of Name
Subject to Shareholders' approval of the Proposals, it is
proposed that the name of the Company be changed to URA Holdings
plc. The TIDM will remain URA.
Proposed Directors' Remuneration Package
As set out below, subject to completion of the Proposals and the
adoption of a Share Option Plan, it is proposed that each of the
Proposed Directors enter into a letter of appointment with the
Company pursuant to which they will each be appointed as directors
of the Company for an initial term of one year and that they will
each be paid GBP12,000 per annum, monthly in arrears. In addition,
each Proposed Director will receive a bonus equivalent to GBP1,000
per month, or GBP6,000, whichever is greater, when the Company
completes a transaction which constitutes a reverse takeover under
the AIM Rules.
In addition, it is intended that, subject to completion of the
Proposals and any approvals required for the adoption thereof being
obtained, the Company will adopt a Share Option Plan over, in
aggregate, 15 per cent. of the Enlarged Share Capital, exercisable
at the Placing Price at any time for a period of five years. The
Share Option Plan will be put in place in order to incentivise the
Proposed Directors of the Company and certain key staff and
individuals. Of these options, it is proposed that each of the
Proposed Directors is awarded options over 2.5 per cent of the
issued share capital of the Company. In addition, Mike Langoulant,
who will undertake the financial management functions of the
Company and Colin Weinberg, who will provide consultancy services
to the Company, will each be awarded options over 2.5 per cent. of
the issued share capital of the Company. The remaining options will
be awarded in the future to key staff and individuals at the
discretion of the directors.
Share Option Plan
Under the rules of the Share Option Plan the following
provisions are proposed:
Grant
(a) the Board may select and grant options to, from time to time
in its absolute discretion, any number of persons ("Eligible
Participants") who are at the intended date of grant a director,
officer, employee of the Company or one of its subsidiaries;
(b) the exercise of an option may be subject to the satisfaction
of performance conditions specified by the Board at the date of
grant of the option;
(c) if the Board reasonably considers events have affected the
viability of such performance conditions and that they no longer
represent a fair measure of performance, the Board may waive or
vary them so long as the variation does not result in more onerous
performance conditions;
(d) the Board determines (at the date of grant) the exercise
period during which an option holder may exercise an option to end
no later than the day prior to the tenth anniversary on the date of
grant;
(e) it is a condition of a grant of an option that each option
holder indemnifies the Company (if permitted by law) against any
income tax and/or employee national insurance contribution charges
or any similar employment or withholding tax or costs arising in
the territory of residence and/or employment of the option holder,
resulting from the grant, exercise, disposal or release of an
option; and
(f) no more than 15 per cent. of the Enlarged Share Capital may
be issued under the Share Option Plan.
Exercise
(a) each option shall be exercisable only by the option holder
to whom it is granted (or his personal representative) and may not
be transferred, assigned or charged and the option shall lapse on
any purported transfer assignment or charge by the option
holder;
(b) if an option holder dies, then an unvested Option may be
exercised within twelve months after death but within the exercise
period;
(c) if an option holder ceases to be an Eligible Employee by
reason of ill health, injury, disability, redundancy or retirement
an unvested option may be exercised within 120 days of
cessation;
(d) if an option holder ceases to be an Eligible Employee for
any other reason an unvested option may only be exercised with the
discretion of the Board; and
(e) if an offer is made which may result in a change of control
of the Company the Board is entitled to notify the option holders
and allow them to exercise their options within six months of the
completion of the change of control.
Amendments
(a) in the event of a capitalisation, or rights issue or
sub-division or consolidation or reduction or otherwise the Board
may make appropriate adjustments to the number of shares under
option and the price at which shares may be acquired on exercise;
and
(b) the Board may amend the rules at any time, except that
shareholder approval is required to amend the limit of the relevant
plan, and cannot make alterations which would materially increase
the liability of an option holder or which may materially decrease
the value of his subsisting rights attached to any option without
the option holder's consent.
Proposed Option Issues
The following are the option issues proposed to be made under
the Share Option Plan:
Option Options Exercise Expiry Percentage
holder over New price per date of Enlarged
Ordinary option Share Capital
Shares (%)
---------------- ----------- ----------- ------- ---------------
Melissa 19 Dec
Sturgess 6,689,165 0.45p 2022 2.5
---------------- ----------- ----------- ------- ---------------
19 Dec
Peter Redmond 6,689,165 0.45p 2022 2.5
---------------- ----------- ----------- ------- ---------------
19 Dec
Colin Weinberg 6,689,165 0.45p 2022 2.5
---------------- ----------- ----------- ------- ---------------
Michael 19 Dec
Langoulant 6,689,165 0.45p 2022 2.5
---------------- ----------- ----------- ------- ---------------
19 Dec
Unallocated 13,378,331 0.45p 2022 5
---------------- ----------- ----------- ------- ---------------
The grant of options is conditional on the passing of the
Resolutions.
The proposed Share Option Plan for the Proposed Directors of the
Company and certain key staff and individuals constitutes a related
party transaction under the AIM Rules. Alex Gostevskikh, who is the
independent director for the purposes of the Share Option Plan,
having consulted with Northland, the Company's nominated adviser,
considers that the terms of the Share Option Plan are fair and
reasonable insofar as the Company's Shareholders are concerned.
New Strategy and Use of Proceeds
The Company's proposed strategy, following the Disposal, will be
to acquire a substantial business that is seeking an AIM quoted
platform. The Directors will be agnostic in relation to sector but
will focus on an acquisition that can create significant value for
shareholders in the form of capital growth and/or dividends. The
net use of proceeds from the Placing will be used for general
working capital purposes and to investigate suitable acquisition
opportunities.
Recommendation
The Existing Directors intend to vote in favour of the
Resolutions in respect of their shareholdings which in aggregate
amount to 5,940,000 Existing Ordinary Shares representing 0.8 per
cent. of the existing ordinary share capital. In addition, the
Company has received an irrevocable undertaking from Estes to vote
favour of the Resolutions in respect of its shareholding of
417,354,167 Existing Ordinary Shares representing 55.1 per cent. of
the existing ordinary share capital.
This information is provided by RNS
The company news service from the London Stock Exchange
END
MSCLLFEVFRLSIID
(END) Dow Jones Newswires
December 04, 2017 09:00 ET (14:00 GMT)
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