XSG Xeros Technology Group Plc

THIS ANNOUNCEMENT, INCLUDING THE APPENDIX AND INFORMATION CONTAINED HEREIN, IS RESTRICTED AND IS NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, IN WHOLE OR IN PART, DIRECTLY OR INDIRECTLY, IN, INTO OR FROM THE UNITED STATES, CANADA, JAPAN, AUSTRALIA, NEW ZEALAND, THE REPUBLIC OF SOUTH AFRICA, THE REPUBLIC OF IRELAND, ANY MEMBER STATE OF THE EEA OR ANY OTHER JURISDICTION WHERE TO DO SO WOULD CONSTITUTE A VIOLATION OF THE RELEVANT LAWS OR REGULATIONS OF THAT JURISDICTION. PLEASE SEE THE IMPORTANT NOTICES AT THE END OF THIS ANNOUNCEMENT.

THIS ANNOUNCEMENT IS FOR INFORMATION PURPOSES ONLY AND SHALL NOT CONSTITUTE AN OFFER TO SELL OR ISSUE OR THE SOLICITATION OF AN OFFER TO BUY, SUBSCRIBE FOR OR OTHERWISE ACQUIRE ANY NEW ORDINARY SHARES OF XEROS TECHNOLOGY GROUP PLC IN THE UNITED STATES, CANADA, JAPAN, AUSTRALIA, NEW ZEALAND,  THE REPUBLIC OF SOUTH AFRICA, THE REPUBLIC OF IRELAND, ANY MEMBER STATE OF THE EEA OR ANY OTHER JURISDICTION IN WHICH SUCH RELEASE, PUBLICATION OR DISTRIBUTION WOULD BE UNLAWFUL.

THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION AS DEFINED IN ARTICLE 7 OF THE MARKET ABUSE REGULATION EU NO. 596/2014, AS RETAINED AND APPLICABLE IN THE UK PURSUANT TO S3 OF THE EUROPEAN UNION (WITHDRAWAL) ACT 2018 ("MAR"). UPON THE PUBLICATION OF THIS ANNOUNCEMENT, THIS INSIDE INFORMATION IS NOW CONSIDERED TO BE IN THE PUBLIC DOMAIN.

Xeros Technology Group plc

("Xeros", the "Group" or the "Company")

Placing and Subscription to raise £4.5 million,

Retail Offer to raise up to £1.0 million

and

Notice of General Meeting

Xeros Technology Group plc (AIM: XSG), the creator of technologies that reduce the impact of clothing on the planet, is pleased to announce a placing and subscription to raise £4.5 million (before fees and expenses) via a placing and subscription of 300,000,000 and 833,332 new ordinary shares respectively (the "Placing Shares" and "Subscription Shares" respectively) of 0.1 pence each in the capital of the Company ("Ordinary Shares") each at an issue price of 1.5 pence per share (the "Issue Price") (the "Placing" and "Subscription").

In addition to the Placing and Subscription the Company intends to provide Shareholders who have not taken part in the Placing or Subscription with the opportunity to subscribe for up to 66,666,666 new Ordinary Shares (the "Retail Offer Shares"), to raise up to approximately £1.0 million (before expenses) at the Issue Price (the "Retail Offer") (the Placing, Subscription and Retail Offer together the "Fundraising", and the Placing Shares, Subscription Shares and the Retail Offer Shares together the "New Ordinary Shares"). A separate announcement will be made shortly regarding the Retail Offer and its terms. The Placing and Subscription are not conditional upon the Retail Offer. For the avoidance of doubt, the Retail Offer is not part of the Placing or Subscription.

The Placing is intended to be effected in two tranches as follows:

·      15,098,290 Firm Placing Shares expected to be admitted to trading on AIM on 5 April 2024; and

·      352,401,708 Conditional Placing Shares, conditional, inter alia, on the passing of the Resolutions at the General Meeting, expected to be admitted to trading on AIM on 26 April 2024.

The Placing will be conducted by way of an accelerated bookbuild ("ABB") which will be launched immediately following this announcement ("Announcement"), in accordance with the terms and conditions set out in the appendix to this Announcement.

Highlights:

The timing for the close of the ABB and allocation of the Placing Shares shall be at the absolute discretion of Cavendish Capital Markets Limited ("Cavendish"), in consultation with the Company. The final number of Placing Shares to be issued pursuant to the Placing will be agreed by Cavendish and the Company at the close of the ABB. The result of the Placing will be announced as soon as practicable thereafter.

In accordance with the terms of the placing agreement between the Company and Cavendish ("Placing Agreement"), the Fundraise is conditional upon, amongst other things, the Placing Agreement not having been terminated in accordance with its terms prior to either First Admission or Second Admission as the case may be (or such later date as Cavendish may agree).

It is anticipated the New Ordinary Shares will represent approximately 63.3 per cent. of the Company's issued ordinary share capital following Second Admission (assuming full take up under the Retail Offer). The Issue Price of 1.5 pence per New Ordinary Share represents a discount of approximately 18.9 per cent. to the closing mid-market price of 1.85 pence per Ordinary Share on 4 April 2024, being the last trading day immediately preceding the date of this announcement. The New Ordinary Shares, when issued, will be fully paid and will rank pari passu in all respects with the existing Ordinary Shares, including the right to receive all dividends and other distributions declared, made or paid in respect of such New Ordinary Shares after the date of their admission to trading on AIM.

Cavendish acted as nominated adviser, broker and bookrunner in connection with the Placing.  No part of the Placing, the Subscription or the Retail Offer is underwritten.

The appendix to this Announcement (which forms part of this Announcement) contains the detailed terms and conditions of the Placing.

Commenting on the Fundraising, Neil Austin, CEO of Xeros, said:

"Our technology solutions drive significant cost, energy and water efficiencies for our customers while reducing pollution in both the manufacture and laundering of clothing.

"The fundraise puts the Group in the strongest possible position to execute its commercialisation strategy, which is focused around high-margin licence fees and recurring consumable revenue.

"I would like to take this opportunity to thank investors for their continued support at this exciting time for Xeros."

General Meeting and Shareholder Approval

For the Second Admission Shares to be admitted to trading on AIM, Shareholder approval is required:

a)     by way of ordinary resolution to give the Directors authority to allot such Second Admission Shares; and

b)    by way of a special resolution to disapply statutory pre-emption rights in respect of such Second Admission Shares.

The authorities referred to above are in addition to the Company's existing general shareholder authorities to allot Ordinary Shares for cash on a non-pre-emptive basis. The Firm Placing Shares will be allotted and issued under the Company's existing general shareholder authorities.

In order to obtain the necessary shareholder approval, a General Meeting is to be held at the Company's offices at Unit 2 Evolution Advanced Manufacturing Park, Whittle Way, Catcliffe, Rotherham S60 5BL, United Kingdom at 11:00 a.m. on 25 April 2024 at which the Resolutions will be proposed. A Circular containing a notice of General Meeting is expected to be sent to shareholders on 8 April 2024. The shareholder Circular and notice of General Meeting will be made available on the Company's website at www.xerostech.com.

EXPECTED TIMETABLE OF KEY EVENTS

 Notes

Enquiries:

About Xeros

Xeros Technology plc has developed patented and proven, industry-leading technologies which reduce the environmental impact of how industries make and care for clothes.

The traditional wet processing methods used in industrial and domestic laundry and garment manufacturing consume billions of litres of fresh water and large amounts of energy and chemicals, as well as damaging and weakening clothing fibres and creating rising levels of environmental pollution. It is estimated that washing machines contribute 35% of the 171 trillion microplastic particles in the ocean.

A range of factors, including consumers, the media NGOs and regulators are exerting pressure on these industries, with legislative action beginning to be taken.

Xeros' three main technologies, Filtration, Finish, and Care, facilitate garment manufacturers, industrial laundries, domestic washing machine manufacturers and consumers, to reduce their environmental impact, whilst also significantly improving efficiency in the process.

Xeros' model is to generate revenue from licensing its technologies, generating royalties and the sale of consumables. Currently there are 8 agreements in place. The addressable markets in Filtration, Finish and Care are estimated to be valued at £350m p.a., £132m p.a. and £3bn p.a. respectively.

Forward-Looking Statements

This announcement contains forward-looking statements. These statements relate to the Group's future prospects, developments and business strategies. Forward-looking statements are identified by their use of terms and phrases such as "potential", "estimate", "expect", "may", "will" or the negative of such terms and phrases, variations or comparable expressions, including references to assumptions. The forward-looking statements in this announcement are based on current expectations and are subject to risks and uncertainties that could cause actual results to differ materially from those expressed or implied by those statements. These forward-looking statements speak only as at the date of this announcement. No statement in this announcement is intended to constitute a profit forecast or profit estimate for any period. No representation or warranty is given as to the completeness or accuracy of the forward-looking statements contained in this Announcement.  Neither the Directors nor the Company undertake any obligation to update forward-looking statements other than as required by the AIM Rules or by the rules of any other securities regulatory authority, whether as a result of new information, future events or otherwise.

Market Abuse Regulation

Market soundings, as defined in MAR, were taken in respect of the Placing, with the result that certain persons became aware of inside information, as permitted by MAR. That inside information is set out in this announcement and has been disclosed as soon as possible in accordance with paragraph 7 of article 17 of MAR. Therefore, those persons that received inside information in a market sounding are no longer in possession of inside information relating to the Company and its securities.

ADDITIONAL INFORMATION
ON
THE PROPOSED PLACING AND SUBSCRIPTION OF 300,833,332 ORDINARY SHARES,

RETAIL OFFER OF UP TO 66,666,666 ORDINARY SHARES,

EACH AT A PRICE OF 1.5 PENCE PER ORDINARY SHARE
AND
GENERAL MEETING

INTRODUCTION

The Company is pleased to confirm today that it has now conditionally raised £4.5 million before fees and expenses by way of the Placing and Subscription with existing and new institutional investors at an Issue Price of 1.5 pence per new Ordinary Share. The Placing and Subscription are not being underwritten.

To provide Shareholders who have not taken part in the Placing or Subscription with an opportunity to participate in the Fundraise, the Company is providing existing Shareholders with the opportunity to subscribe for up to 66,666,666 Retail Offer Shares at the Issue Price, via the Bookbuild Platform, to raise up to £1.0 million (before expenses), by way of the Retail Offer. The Retail Offer is not being underwritten.

The Placing is intended to be effected in two tranches as follows:

·      15,098,290 Firm Placing Shares expected to be admitted to trading on AIM on 5 April 2024; and

·      352,401,708 Conditional Placing Shares, conditional, inter alia, on the passing of the Resolutions at the General Meeting, expected to be admitted to trading AIM on 26 April 2024.

The Issue Price represents a discount of 18.9% to the Closing Price, being the latest practical date prior to the publication of this announcement. The Firm Placing Shares and Second Admission Shares will represent, respectively, approximately 2.6% and 61.0% of the Company's issued ordinary share capital following Second Admission (assuming the Retail Offer Shares are taken-up in full).

For the Conditional Placing, Subscription and Retail Offer to proceed, the Company requires Shareholders' approval to authorise the Directors to allot such New Ordinary Shares and disapply pre-emption rights in relation to them.

REASONS FOR THE FUNDRAISE AND USE OF PROCEEDS

Reasons for the Fundraise

Xeros today has three core areas of focus in its Filtration ("XF"), Care ("XC") and Finish ("XFN") technologies (together "Core Technologies"). The Core Technologies together target the textile production and consumption stages of the global apparel value chain addressing c.60 per cent. of the apparel industry's total climate impact.  As a global leader in sustainable textile technologies Xeros has been actively involved with legislators, industry groups and non-government organisations to show the scale of the environmental challenge and demonstrate the effectiveness of its solutions.

The Board is very encouraged with the Company's current positioning as regards the Core Technologies and the scope for growth they offer which is the result of many years' development and approximately £150 million in aggregate investment to date, which has yielded the strong licensing progress and commercial momentum of the last few years.  The Company now has license agreements in place with five manufacturers of garment washing/processing machines, three major European manufacturers of components for the machine supply chain and is in direct commercial discussions with six of the top ten global washing machine manufacturers in relation to Xeros Filtration or Care technology.

The Board conservatively estimate Xeros' Core Technologies, based on current agreements in-place with license and development partners, to provide an addressable global market opportunity of c£40m-£50m pa in revenue terms to Xeros in the medium term, though believe the Company is now at an important inflection point whereby the route to nearer-term meaningful revenue is clear, with a number of the Company's commercial partners now believed to be close to commercial-scale roll-out of machinery containing some element of Xeros' IP.

Whilst the Board is highly confident as regards the route to near-term revenue, with first royalty income and month on month cashflow and EBITDA breakeven expected during the second half of FY24, in-line with prior guidance, given the inherent uncertainties as regards the precise timing of this and having regard to the Company's current cash position as set out in the paragraph headed "Current Trading and Outlook" below, and for the other reasons set out in the paragraph headed "Use of Proceeds" below the Board is now proposing to undertake the Fundraising, though does so with a commercial strategy refocused around high-margin license fees and recurring consumable revenues, a lean cost base and its well-positioned suite of Core Technologies:

Filtration ("XF")

The imperative for microfibre filtration in both commercial and domestic washing machines is increasing rapidly with the human, business and environmental impact of microplastics now well established and legislative control of the resulting pollution fast approaching.  Legislation is now imminent in France driving early adoption of technology (effective 1 January 2025) with similar regulatory agendas in the EU more broadly and the USA adding to market momentum.  Against that backdrop the Board is highly confident that Xeros is well placed to capitalise with its market-leading XF offering which has been third-party verified to be 99 per cent. effective in terms of microplastic capture.

The Company has been busy extending its offering in filtration, with the soft launch of its external filtration device (XF³) in addition to its internal device (XF¹), an offering which will provide a wider choice to manufacturers and consumers alike.

The Company now has in place licensing agreements with three major European component manufacturers, which facilitate 'approved supplier' status for 99 per cent. of major washing machine brands, as well as significant engagement with other leading global OEMs across all of the Company's technology platforms. Conservative Board estimates, based on low level penetration of the EMEA domestic washing machine market (estimated to be c.25 - 30 million units per annum), reflect capturing 0.4% to 1.4% of the EMEA market and provide a near-term revenue opportunity of c. £0.3m to £1.6m on the Company's overall XF offering, with variability driven by both partner unit sales and margin which is expected to differ between the Company's internal and external filtration solutions. The first royalty income is expected during the second half of FY24, and the Board believes the potential for XF is significantly larger over the longer term.

Care ("XC")

The Company has continued to work with its partner IFB Industries Limited ("IFB"), a top 3 Indian brand, which has already launched an XC-enabled 11kg domestic washing machines, designed for large households in India, and which is now in field trails on a smaller 9kg domestic machine suitable for the Indian mass market; the Board remains confident that these trials will advance to a mass market launch and first royalty revenues during FY24.

Progress is also being made with Xeros' other commercial laundry partners.  Georges SAS, the Company's French commercial laundry partner is now using XC-enabled machines across laundry sites caring for uniforms on behalf of Air France and SNCF, with SNCF demonstrating 20% increased uniform lifetimes (equivalent to 12-18 months' additional use) by using the Xeros XC technology.  In the UK, the Company's partner Ecoprod, an environmental solutions provider and water-usage reduction expert, is facilitating access for the XC technology to the leisure, private healthcare, NHS and hospitality markets in the UK; this route to market is also expected to yield royalty income during the course of FY24.

Other initiatives currently underway and which are expected to produce new commercial agreements during FY24 include advanced discussions with other major European and North American commercial laundry manufacturers for licensing of the XC technology as well as active engagement with 6 of the top-10 global washing machine brands. Xeros are in advanced discussions with one of the world's largest washing machine manufacturers and currently retrofitting an XDrum and XOrb capability to one of said manufacturer's machines.

The Company's Care technology is split between applications for the domestic (XC1) and commercial (XC2) markets.  Across these two applications and based on limited penetration of current license partner output, the Board estimate a near-term revenue opportunity of between £0.6m and £2.5m (with associated additional ongoing annual income of approximately £0.1m over the life of commercial machines from the sale of XOrb polymer beads) with these expected to commence during the course of FY24.

Finish ("XFN")

The broader opportunity for XFN posed by the global fashion industry is very significant.  As the world's third largest manufacturing industry (behind only automobile and technology) the fashion industry is reportedly responsible for between 2-8 per cent. of global carbon emissions, uses 79 trillion litres of water and produces 92 million tons of solid waste each year.  In that context apparel companies are now taking serious steps to reduce their impact.  The Board are confident that the XFN technology has a direct role to play in helping to achieve this with its ability to reduce usage of water, chemicals and pumice in the denim finishing process - c.2.0 billion pairs of jeans are made every year with the Company estimating that XFN is capable of saving 0.15US$ on the production cost of every pair of jeans, saving an estimated 44 tonnes of carbon emissions for each XFN-enabled machine each year, whilst offering manufacturers attractive pay back profiles for the associated investment.

Xeros' nearest term opportunity as regards XFN lies with its license and distribution agreement with KRM Tekstil Boya San. Tic Ltd ("KRM") which provides KRM with 10-year, worldwide non-exclusive distribution rights for top-three global supplier Yilmak Makine ("Yilmak") manufactured machinery incorporating Xeros' XFN technology for denim processing, garment finishing and garment dyeing.  This agreement is expected to yield royalty revenue during FY24.

The Company is also in advanced discussions with a market leading apparel brand for a Xeros technology produced 'range' of denim, and bulk trials have also been carried out with a European retail brand. Additionally, the Group's area of expertise within denim has also been strengthened by the strategic addition of a new denim expert to its advisory board.

Based on a conservative rate of penetration of the annual sales of its key XFN license partner, the Company estimates that revenue as generated from both royalties on machine sales and the sale of XOrbs to be between £0.3m and £0.9m, with additional revenue to be generated in future years over the life of machines (estimated to be between 10 and 15 years) via additional sales of XOrbs.

Use of proceeds

The net proceeds of the Fundraise amounting to approximately £5.0 million (assuming full take-up of the Retail Offer) will be used to:

·      strengthen the Company's balance sheet, enabling execution of current contracts, pursuit of global opportunities and to provide reassurance to contract counterparties;

·      provide working capital as the Company advances commercialisation of its Core Technologies;

·      provide contingency against timing of royalty income and operational cash flow break-even; and

·      as appropriate, scale operations and accelerate development of other markets and applications for the Company's IP.

CURRENT TRADING AND OUTLOOK

In the Company's reported interim results to 30 June 2023 the Board noted significant progress in all areas of the business with commercial momentum building.  Since those results the Company has reported that adjusted LBITDA (loss on ordinary activities before interest, tax, share-based payment expense, warrant expense, depreciation and amortisation) for FY23 is expected to be in line with expectations as a result of the Board's continued focus on cost control with year-end cash closing out in line with expectations (on an unaudited basis) at c.£1.6m, boosted during December 2023 by receipt of an R&D tax credit payment of approximately £0.5m from HMRC. Overall net monthly cash burn in FY23 was c.£0.4m.

Since 31 December 2023 a further c.£1.68m cash has been raised from the exercise of outstanding warrants to subscribe for new Ordinary Shares at a price of 2.85p each ("Warrants").  There are no Warrants now outstanding.  As a result the current cash runway (prior to completion of the Fundraising) of the Company would last the Company until approximately August 2024, assuming no curtailment of current operations.

DETAILS OF THE FUNDRAISE

The Placing

The Company has conditionally raised £4.5 million (before fees and expenses) by way of the placing of 300,000,000 New Ordinary Shares at the Issue Price with existing and new institutional investors.

The allotment and issue of the Firm Placing Shares is not conditional on the passing of the Resolutions at the General Meeting. The allotment and issue of the Conditional Placing Shares is conditional on the passing of the Resolutions at the General Meeting.  Placing of all of the Placing Shares is conditional on Admission of such shares to trading on AIM, at First Admission or Second Admission, as applicable.

The Issue Price represents a discount of approximately 18.9% from the Closing Price. The Placing Shares will represent approximately 52.0% of the Enlarged Share Capital following Second Admission (assuming the Retail Offer is subscribed in full). In order to broaden the Company's institutional investor base and to minimise the time and transaction costs of the Fundraise, the Placing Shares are only being placed by Cavendish with a limited number of existing and new investors. The Placing Shares are not being made available to the public.

The Placing Shares will be free of all liens, charges and encumbrances and will, when issued and fully paid, be identical to and rank pari passu in all respects with the Existing Ordinary Shares, including the right to receive all future distributions, declared, paid or made in respect of the Ordinary Shares following the date of First Admission and Second Admission (as applicable).

The Subscription

Certain of the Directors are participating in the Fundraise pursuant to separate Subscription Letters at the Issue Price. Their aggregate participation will amount to 833,332 New Ordinary Shares. Further details are set out in the paragraph headed "Related Party Transactions" below.

The Retail Offer

Pursuant to the terms of the Retail Offer, the Company has made the Retail Offer to Retail Investors only through intermediary financial institutions appointed by the Company in connection with the Retail Offer via the Bookbuild Platform.

Conditional on, amongst other things, the Resolutions being duly passed at the General Meeting and Second Admission, up to 66,666,666 Retail Offer Shares will be issued through the Retail Offer at the Issue Price to raise proceeds of up to approximately £1.0 million (before expenses).

If the Retail Offer is taken up in full, the Retail Offer Shares will represent approximately 11 per cent. of the Enlarged Share Capital. The Retail Offer Shares, when issued and fully paid, will rank pari passu in all respects with the Existing Ordinary Shares then in issue.

A separate announcement will be made shortly containing instructions for Shareholders regarding the Retail Offer.

The Placing Agreement

In connection with the Fundraise, the Company has entered into the Placing Agreement pursuant to which Cavendish has agreed, in accordance with its terms, to use reasonable endeavours to procure subscribers for the Placing Shares and to co-ordinate the Retail Offer in each case at the Issue Price. The Placing and Retail Offer are not underwritten.

In accordance with the terms of the Placing Agreement, the Fundraise is conditional upon, amongst other things, the passing of the Resolutions in respect of the Second Admission Shares, the conditions in the Placing Agreement being satisfied or (if applicable) waived and the Placing Agreement not having been terminated in accordance with its terms prior to First Admission or Second Admission occurring on or before 31 May 2024 (or such later date as Cavendish may agree).

The Placing Agreement contains certain warranties given by the Company in favour of Cavendish concerning, amongst other things, the accuracy of information given in the circular in respect of the Fundraise as well as other matters relating to the Group and its business.

The Placing Agreement is terminable by Cavendish in certain circumstances up until the time of Second Admission, including, inter alia, should there be a breach of a warranty contained in the Placing Agreement or if certain force majeure events take place or a material adverse change occurs to the business of the Company or the Group. The Company has also agreed to indemnify Cavendish against all losses, costs, charges and expenses which Cavendish may suffer or incur as a result of, occasioned by or attributable to the carrying out of its duties under the Placing Agreement.

The Placing is not conditional on the Retail Offer proceeding or on any minimum take-up under the Retail Offer.

Admission of the New Ordinary Shares

Application will be made to the London Stock Exchange for the New Ordinary Shares to be admitted to trading on AIM, subject, inter alia, to the passing of the Resolutions at the General Meeting in the case of the Second Admission Shares. It is expected that First Admission will become effective in respect of, and that dealings on AIM will commence in, all of the First Admission Shares, on 5 April 2024. Second Admission will become effective in respect of, and dealings on AIM will commence in, all of the Second Admission Shares, on 26 April 2024.

It is expected that CREST accounts of the investors in the Firm Placing Shares who hold their Ordinary Shares in CREST will be credited with their Firm Placing Shares on 5 April 2024, and CREST accounts of the investors in the Second Admission Shares who hold their Ordinary Shares in CREST will be credited with their Second Admission Shares on 26 April 2024.

In the case of investors in the New Ordinary Shares holding their Ordinary Shares in certificated form, it is expected that certificates will be dispatched within 10 business days of First or Second Admission as applicable. Pending dispatch of the share certificates or the crediting of CREST accounts, the Registrar will certify any instruments of transfer against the register.

Deferred Subscription Deed and Additional Subscription Shares

In connection with the Placing, the Company has entered into a deferred subscription deed ("the Deferred Subscription Deed") with Amati Global Investors Limited entitling Amati AIM VCT Plc ("Amati") to subscribe for a further 33,333,333 new Ordinary Shares at the Issue Price at any time before 31 January 2025, the number of shares corresponding to half the number of shares subscribed by Amati in the Placing.

To provide all investors in the Fundraise with the same right to subscribe for new Ordinary Shares on economic terms consistent with those provided to Amati, as outlined above, the Company is also now seeking authority to issue and allot Additional Subscription Shares conditional on the passing of the Resolutions at the General Meeting. If passed, the Resolutions would allow the Company to issue additional Ordinary Shares in the future to all investors in the Fundraise (in proportion to their holding of New Ordinary Shares at the relevant point in time) to raise up to a further £2.88 million at the Issue Price in aggregate, including the shares subject to the Deferred Subscription Deed.  The Company will make further announcements concerning any additional subscriptions at the appropriate time, however, there can be no guarantee that such subscriptions can be concluded.

RELATED PARTY TRANSACTIONS

Canaccord Genuity Asset Management Limited, Lombard Odier Investment Managers, Neil Austin, Alex Tristram and Klaas de Boer each a Related Party (as defined by the AIM Rules), are intending to participate in the Fundraise as follows:

The participation of Neil Austin and Alex Tristram by way of the Subscription and Klaas de Boer's intention to participate via the Retail Offer(the "Participating Directors") constitute related party transactions by virtue of them each being Director. The Directors (excluding the aforementioned Directors participating in the Fundraise) consider, having consulted with Cavendish (the Company's nominated adviser), that the terms of Participating Directors subscription in the Fundraising are fair and reasonable insofar as the Company's Shareholders are concerned. 

The participation in the Placing of Canaccord Genuity Asset Management Limited and Lombard Odier Investment Managers constitute related party transactions by virtue of their being substantial shareholders in the Company.  The Directors consider, having consulted with Cavendish (the Company's nominated adviser), that the terms of their participation in the Fundraising are fair and reasonable insofar as the Company's shareholders are concerned.

HMRC EIS ADVANCE ASSURANCE

The Company has received clearance from HMRC that the Group's business qualifies for EIS Relief. The Company has been advised that a subscription for Ordinary Shares by a VCT is capable of being a 'qualifying holding' for VCT Relief. Although qualifying investors should obtain tax relief on their investments under EIS relief or VCT relief, and (save as otherwise agreed with the Company) neither the Company nor the Directors can provide any warranty or guarantee in this regard. Investors must take their own advice and rely on it.

Save as otherwise specifically and expressly agreed in writing with the Company, neither the Company nor the Directors give any warranties or undertakings that EIS Relief or VCT Relief will not be withdrawn or that the business will be managed in such a way as to preserve EIS or VCT relief. Investors must take their own advice and rely on it. If the Group carries on activities beyond those disclosed to HM Revenue & Customs, then shareholders may cease to qualify for the relevant tax benefits.

APPENDIX 1

TERMS AND CONDITIONS OF THE PLACING

IMPORTANT INFORMATION FOR INVITED PLACEES ONLY

MEMBERS OF THE PUBLIC ARE NOT ELIGIBLE TO TAKE PART IN THE PLACING.  THE  ANNOUNCEMENT REGARDING THE PLACING (THE "ANNOUNCEMENT") AND THE TERMS AND CONDITIONS  SET OUT HEREIN ("TERMS AND CONDITIONS") ARE DIRECTED ONLY AT PERSONS WHOSE ORDINARY ACTIVITIES INVOLVE THEM IN ACQUIRING, HOLDING, MANAGING AND DISPOSING OF INVESTMENTS (AS PRINCIPAL OR AGENT) FOR THE PURPOSES OF THEIR BUSINESS AND WHO HAVE PROFESSIONAL EXPERIENCE IN MATTERS RELATING TO INVESTMENTS AND ARE: (A) IF IN THE UNITED KINGDOM, QUALIFIED INVESTORS AS DEFINED IN ARTICLE 2(E) OF THE EU PROSPECTUS REGULATION WHICH FORMS PART OF DOMESTIC LAW PURSUANT TO THE EUROPEAN UNION (WITHDRAWAL) ACT 2018) (THE "UK PROSPECTUS REGULATION")  WHO ALSO (I) HAVE PROFESSIONAL EXPERIENCE IN MATTERS RELATING TO INVESTMENTS WHO FALL WITHIN ARTICLE 19(5) OF THE FINANCIAL SERVICES AND MARKETS ACT 2000 (FINANCIAL PROMOTION) ORDER 2005, AS AMENDED (THE "ORDER") (INVESTMENT PROFESSIONALS) OR (II) FALL WITHIN ARTICLE 49(2)(a) TO (d) (HIGH NET WORTH COMPANIES, UNINCORPORATED ASSOCIATIONS, ETC.) OF THE ORDER; OR (B) PERSONS TO WHOM THEY MAY OTHERWISE LAWFULLY BE COMMUNICATED (ALL SUCH PERSONS TOGETHER BEING REFERRED TO AS "RELEVANT PERSONS").

THE ANNOUNCEMENT AND THE TERMS AND CONDITIONS AND THE INFORMATION HEREIN MUST NOT BE ACTED ON OR RELIED ON BY PERSONS WHO ARE NOT RELEVANT PERSONS.  PERSONS DISTRIBUTING THE ANNOUNCEMENT OR THE TERMS AND CONDITIONS MUST SATISFY THEMSELVES THAT IT IS LAWFUL TO DO SO.  ANY INVESTMENT OR INVESTMENT ACTIVITY TO WHICH THE TERMS AND CONDITIONS RELATE IS AVAILABLE ONLY TO RELEVANT PERSONS AND WILL BE ENGAGED IN ONLY WITH RELEVANT PERSONS.  THE ANNOUNCEMENT AND THE TERMS AND CONDITIONS DO NOT THEMSELVES CONSTITUTE AN OFFER FOR SALE OR SUBSCRIPTION OF ANY SECURITIES IN XEROS TECHNOLOGY GROUP PLC.

THE PLACING SHARES HAVE NOT BEEN AND WILL NOT BE REGISTERED UNDER THE  UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT") OR UNDER THE APPLICABLE SECURITIES LAWS OR WITH ANY SECURITIES REGULATORY AUTHORITY OF ANY STATE OR JURISDICTION OF THE UNITED STATES, AND MAY NOT BE OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED, DIRECTLY OR INDIRECTLY, IN THE UNITED STATES EXCEPT PURSUANT TO AN EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND IN COMPLIANCE WITH ANY APPLICABLE SECURITIES LAWS OF ANY STATE OR OTHER JURISDICTION OF THE UNITED STATES.  THE PLACING SHARES ARE BEING OFFERED AND SOLD ONLY OUTSIDE THE UNITED STATES IN "OFFSHORE TRANSACTIONS" WITHIN THE MEANING OF, AND IN ACCORDANCE WITH, REGULATION S UNDER THE SECURITIES ACT AND OTHERWISE IN ACCORDANCE WITH APPLICABLE LAWS.  NO PUBLIC OFFERING OF THE PLACING SHARES IS BEING MADE IN THE UNITED STATES OR ELSEWHERE.

THE ANNOUNCEMENT AND THE TERMS AND CONDITIONS ARE RESTRICTED AND ARE NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, IN WHOLE OR IN PART, DIRECTLY OR INDIRECTLY, IN OR INTO OR FROM THE UNITED STATES, CANADA, THE REPUBLIC OF SOUTH AFRICA, THE REPUBLIC OF IRELAND, AUSTRALIA, NEW ZEALAND, OR JAPAN, ANY MEMBER STATE OF THE EEA OR ANY OTHER JURISDICTION IN WHICH SUCH RELEASE, PUBLICATION OR DISTRIBUTION WOULD BE UNLAWFUL.

EACH PLACEE SHOULD CONSULT WITH ITS ADVISERS AS TO LEGAL, TAX, BUSINESS AND RELATED ASPECTS OF AN INVESTMENT IN PLACING SHARES.

The distribution of the Terms and Conditions and/or the Placing and/or issue of the Placing Shares in certain jurisdictions may be restricted by law.  No action has been taken by the Company, Cavendish (the "Bookrunner") or any of their respective affiliates, agents, directors, officers or employees that would permit an offer of the Placing Shares or possession or distribution of the Terms and Conditions or any other offering or publicity material relating to such Placing Shares in any jurisdiction where action for that purpose is required.  Persons into whose possession these Terms and Conditions come are required by the Company and the Bookrunner to inform themselves about and to observe any such restrictions.

The Announcement and these Terms and Conditions or any part of them are for information purposes only and do not constitute or form part of any offer to issue or sell, or the solicitation of an offer to acquire, purchase or subscribe for, any securities in the United States, Australia, New Zealand, Canada, the Republic of South Africa, the Republic of Ireland, Japan, any member state of the EEA or any other jurisdiction in which the same would be unlawful.  No public offering of the Placing Shares is being made in any such jurisdiction.

In the United Kingdom, the Announcement and these Terms and Conditions are being directed solely at persons in circumstances in which section 21(1) of the Financial Services and Markets Act 2000 (as amended) (the "FSMA") does not apply.

Solely for the purposes of the product governance requirements of Chapter 3 of the FCA Handbook Product Intervention and Product Governance Sourcebook (the "UK MiFIR Product Governance Requirements"), and disclaiming all and any liability, whether arising in tort, contract or otherwise, which any "manufacturer" (for the purposes of the UK MiFIR Product Governance Requirements) may otherwise have with respect thereto, the Placing Shares have been subject to a product approval process, which has determined that the Placing 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 paragraphs 3.5 and 3.6 of COBS; and (ii) eligible for distribution through all permitted distribution channels (the "Target Market Assessment"). Notwithstanding the Target Market Assessment, distributors should note that: the price of the Placing Shares may decline and investors could lose all or part of their investment; the Placing Shares offer no guaranteed income and no capital protection; and an investment in the Placing 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 any contractual, legal or regulatory selling restrictions in relation to the Placing. Furthermore, it is noted that, notwithstanding the Target Market Assessment, Cavendish will only procure investors who meet the criteria of professional clients and eligible counterparties. For the avoidance of doubt, the Target Market Assessment does not constitute: (a) an assessment of suitability or appropriateness for the purposes of Chapters 9A or 10A respectively of COBS; 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 Placing Shares. Each distributor is responsible for undertaking its own target market assessment in respect of the Placing Shares and determining appropriate distribution channels.

The Placing Shares have not been approved or disapproved by the US Securities and Exchange Commission, any state securities commission or other regulatory authority in the United States, nor have any of the foregoing authorities passed upon or endorsed the merits of the Placing or the accuracy or adequacy of the Announcement and these Terms and Conditions or the Circular.  Any representation to the contrary is a criminal offence in the United States. The relevant clearances have not been, nor will they be, obtained from the securities commission of any province or territory of Canada, no prospectus has been lodged with, or registered by, the Australian Securities and Investments Commission or the Japanese Ministry of Finance; the relevant clearances have not been, and will not be, obtained for the South Africa Reserve Bank or any other applicable body in the Republic of South Africa in relation to the Placing Shares and the Placing 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, New Zealand, Canada, the Republic of South Africa, the Republic of Ireland, Japan or any member state of the EEA.  Accordingly, the Placing 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, New Zealand, Canada, the Republic of South Africa, the Republic of Ireland, Japan, any member state of the EEA or any other jurisdiction in which such offer, sale, re-sale or delivery would be unlawful.

Persons (including, without limitation, nominees and trustees) who have a contractual right or other legal obligations to forward a copy of the Announcement (or any part of it) and/or these Terms and Conditions should seek appropriate advice before taking any action.

The Terms and Conditions should be read in their entirety. 

Details of the Placing Agreement and the Placing Shares

The Bookrunner has entered into the Placing Agreement with the Company under which, on the terms and subject to the conditions set out in the Placing Agreement, the Bookrunner, as agent for and on behalf of the Company, has agreed to use its reasonable endeavours to procure Placees for the Placing Shares at the Issue Price. The Placing is not being underwritten by the Bookrunner or any other person.

The exact number of Placing Shares to be allocated and issued to Placees shall be determined by the Bookrunner and the Company following completion of the ABB (as defined below).

The Placing Shares will, when issued, be subject to the memorandum and articles of association of the Company and credited as fully paid and will rank pari passu in all respects with the Existing Ordinary Shares, including the right to receive all dividends and other distributions declared, made or paid in respect of such Ordinary Shares after the date of issue of the Placing Shares.

Accelerated bookbuilding process

Commencing today, the Bookrunner will be conducting an accelerated bookbuilding process to determine demand for participation in the Placing by Placees (the "ABB"). The Announcement gives details of the terms and conditions of, and the mechanics of participation in, the Placing. However, the Bookrunner will be entitled to effect the Placing by such alternative method to the ABB as they may, after consultation with the Company, determine. Save as otherwise agreed with Cavendish, no commissions will be paid by or to Placees in respect of any participation in the Placing for Placing Shares.

A bid in the ABB will be made on these Terms and Conditions which are attached to the Announcement and will be legally binding on the Placee on behalf of which it is made and, except with the Bookrunner's consent, will not be capable of variation or revocation after the close of the ABB.

The book will open with immediate effect. The final number of Placing Shares to be issued pursuant to the Placing will be agreed by the Bookrunner and the Company at the close of the ABB, and the result of the Placing will be announced as soon as practicable thereafter.  The timing for the close of the ABB and the allocation of the Placing Shares shall be at the absolute discretion of the Bookrunner, in consultation with the Company.

To the fullest extent permissible by law and applicable FCA rules, neither:

(a)  the Bookrunner;

(b) any of their respective affiliates, agents, advisers, directors, officers, consultants or employees; nor

(c)  to the extent not contained within (a) or (b), any person connected with the Bookrunner as defined in the FSMA ((b) and (c) being together "affiliates" and individually an "affiliate" of the Bookrunner),

shall have any liability (including to the extent permissible by law, any fiduciary duties) to Placees or to any other person whether acting on behalf of a Placee or otherwise. In particular, neither the Bookrunner nor any of their respective affiliates shall have any liability (including, to the extent legally permissible, any fiduciary duties), in respect of their conduct of the ABB or of such alternative method of effecting the Placing as the Bookrunner may determine.

By participating in the Placing (such participation up to an agreed maximum level to be confirmed in and evidenced by either (i) a recorded telephone call or (ii) email correspondence, in either case between representatives of the Bookrunner to whom the Placee's commitment is given and the relevant Placee (a "Recorded Commitment")), each Placee will be deemed to have read and understood the Announcement and these Terms and Conditions in their entirety, to be participating and acquiring Placing Shares on these Terms and Conditions and to be providing the representations, warranties, indemnities, acknowledgements and undertakings contained in these Terms and Conditions.

In particular, each such Placee irrevocably represents, warrants, undertakes, agrees and acknowledges (amongst other things) severally to the Company and the Bookrunner that:

1.             it is a Relevant Person and that it will acquire, hold, manage or dispose of any Placing Shares that are allocated to it for the purposes of its business;

2.             in the case of a Relevant Person in the United Kingdom who acquires any Placing Shares pursuant to the Placing:

(a)           it is a Qualified Investor within the meaning of Article 2(e) of the UK Prospectus Regulation; and

(b)           in the case of any Placing Shares acquired by it as a financial intermediary, as that term is used in Article 5(1) of the UK Prospectus Regulation:

i.              the Placing Shares acquired by it in the Placing have not been acquired on behalf of, nor have they been acquired with a view to their offer or resale to, persons in any Relevant State (as defined below) other than Qualified Investors or in circumstances in which the prior consent of the Bookrunner has been given to the offer or resale; or

ii.             where Placing Shares have been acquired by it on behalf of persons in any Relevant State other than Qualified Investors, the offer of those Placing Shares to it is not treated under the UK Prospectus Regulation as having been made to such persons;

3.             in the case of a Relevant Person in a member state of the EEA (each a "Relevant State") who acquires any Placing Shares pursuant to the Placing:

(a)           it is a Qualified Investor within the meaning of Article 2(e) of the EU Prospectus Regulation; and

(b)           in the case of any Placing Shares acquired by it as a financial intermediary, as that term is used in Article 5(1) of the EU Prospectus Regulation:

i.              the Placing Shares acquired by it in the Placing have not been acquired on behalf of, nor have they been acquired with a view to their offer or resale to, persons in a Relevant State other than Qualified Investors or in circumstances in which the prior consent of the Bookrunner has been given to the offer or resale; or

ii.             where Placing Shares have been acquired by it on behalf of persons in a Relevant State other than Qualified Investors, the offer of those Placing Shares to it is not treated under the EU Prospectus Regulation as having been made to such persons;

4.             it is acquiring the Placing Shares for its own account or is acquiring the Placing Shares for an account with respect to which it exercises sole investment discretion and has the authority to make and does make the representations, warranties, indemnities, acknowledgements, undertakings and agreements contained in these Terms and Conditions;

5.             it understands (or if acting for the account of another person, such person has confirmed that such person understands) and agrees to comply with the resale and transfer restrictions set out in these Terms and Conditions;

6.             except as otherwise permitted by the Company and subject to any available exemptions from applicable securities laws, it (and any account referred to in paragraph 4 above) is outside the United States acquiring the Placing Shares in offshore transactions as defined in and in accordance with Regulation S under the Securities Act;

7.             it acknowledges that the Placing Shares have not been, and will not be, registered under the Securities Act or with any securities regulatory authority of any state or other jurisdiction of the United States and may not be offered, sold or transferred, directly or indirectly, within the United States except pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act and in compliance with any applicable securities laws of any state or other jurisdiction of the United States; and

8.             the Company, Bookrunner, and others (including each of their respective affiliates, agents, directors, officers or employees) will rely upon the truth and accuracy of the foregoing representations, acknowledgements and agreements.

No prospectus

The Placing Shares are being offered to a limited number of specifically invited persons only and have not been nor will be offered in such a way as to require any prospectus or other offering document in the United Kingdom or any equivalent document in any other jurisdiction to be published.  No prospectus or other offering document has been or will be submitted to be approved by the Financial Conduct Authority ("FCA") or the London Stock Exchange in relation to the Placing or the Placing Shares and Placees' commitments will be made solely on the basis of the information contained in the Announcement and any information publicly announced through a Regulatory Information Service (as defined in the AIM Rules for Companies (the "AIM Rules")) by or on behalf of the Company on or prior to the date of these Terms and Conditions (the "Publicly Available Information") and subject to any further terms set forth in writing in any contract note sent to an individual Placee by the Bookrunner who is acting as agent for and on behalf of the Company in relation to the Placing.

Each Placee, by participating in the Placing, agrees that the content of the Announcement is exclusively the responsibility of the Company and confirms that it has neither received nor relied on any information (other than the Publicly Available Information), representation, warranty or statement made by or on behalf of the Bookrunner or the Company or any other person and none of the Bookrunner, the Company nor any other person acting on such person's behalf nor any of their respective affiliates has or shall have any liability for any Placee's decision to participate in the Placing based on any other information, representation, warranty or statement.  Each Placee acknowledges and agrees that it has relied on its own investigation of the business, financial or other position of the Company in accepting a participation in the Placing.  No Placee should consider any information in the Announcement or these Terms and Conditions to be legal, tax, business or other advice.  Nothing in this paragraph shall exclude the liability of any person for fraudulent misrepresentation.

Save where specifically and expressly agreed in writing, neither the Company nor the Bookrunner make any representation to any Placee regarding an investment in the Placing Shares.

Application for admission to trading

Application(s) will be made to the London Stock Exchange for admission of the Placing Shares to trading on AIM.  It is expected that First Admission will become effective in respect of, and that dealings on AIM will commence in, all of the First Placing Shares, on or around 5 April 2024. It is expected that Second Admission will become effective in respect of, and dealings on AIM will commence in, all of the Second Admission Shares, on or around 26 April 2024. 

Principal terms of the Placing

1.             The Bookrunner is acting as nominated adviser and broker to the Placing, as agent for and on behalf of the Company.

2.             Participation in the Placing is by invitation only and will only be available to persons who may lawfully be, and are, invited by the Bookrunner to participate.  The Bookrunner and any of their respective affiliates are entitled to participate in the Placing as principal.

3.             Each Placee will confirm the maximum number of Placing Shares it is willing to acquire in a Recorded Commitment.  Once they have made a Recorded Commitment, each Placee will have an immediate, separate, irrevocable and binding obligation, owed to the Bookrunner (as agent for the Company), to subscribe and pay for, at the Issue Price, the number of Placing Shares allocated to it, up to the agreed maximum.

4.             Each Placee's allocation and whether such Placee participates in the Placing has or will be determined by the Bookrunner in their discretion following consultation with the Company will be confirmed by the Bookrunner either orally or in writing via a contract note.

5.             Each Placee's commitment will be confirmed in and evidenced by a Recorded Commitment.  These Terms and Conditions will be deemed incorporated into each contract which is entered into by way of a Recorded Commitment and will be legally binding on the relevant Placee(s) on behalf of whom the commitment is made with effect from the end of the Recorded Commitment and, except with the Bookrunner's prior written consent, will not be capable of variation or revocation after such time.  A contract note confirming each Placee's allocation of Placing Shares will be sent to them following the Recorded Commitment and the allocation process.  These Terms and Conditions shall be deemed incorporated into any such contract note.

6.             Each Placee will have an immediate, separate, irrevocable and binding obligation, owed to the Bookrunner (as agent for the Company), to pay to it (or as it may direct) in cleared funds an amount equal to the product of the Issue Price and the number of Placing Shares allocated to such Placee (subject always to such Placee's agreed maximum).

7.            The Bookrunner reserves the right to scale back the number of Placing Shares to be subscribed by any Placee in the event that the Placing is oversubscribed. The Bookrunner also reserves the right not to accept offers to subscribe for Placing Shares or to accept such offers in part rather than in whole. The acceptance and, if applicable, scaling back of offers shall be at the absolute discretion of the Bookrunner.

8.            Except as required by law or regulation, no press release or other announcement will be made by the Bookrunner or the Company using the name of any Placee (or its agent), in its capacity as Placee (or agent), other than with such Placee's prior written consent.

9.             All obligations under the Placing will be subject to fulfilment of the conditions referred to below under "Conditions of the Placing" and to the Placing not being terminated on the basis referred to below under "Termination of the Placing".

10.          By participating in the Placing, each Placee  agrees that its rights and obligations in respect of the Placing will terminate only in the circumstances described below and will not be capable of rescission or termination by the Placee.

Registration and settlement

By participating in the Placing, each Placee will be deemed to agree that it will do all things necessary to ensure that delivery and payment is completed as directed by the Bookrunner in accordance with either the standing CREST or certificated settlement instructions which they have in place with the Bookrunner.

Settlement of transactions in the New Ordinary Shares following Admission will take place within the CREST system, subject to certain exceptions.  Settlement through CREST will be on a delivery versus payment basis ("DVP") unless otherwise notified by the Bookrunner and is expected to occur on the Admission Date. 

In the event of any difficulties or delays in the admission of any Placing Shares to CREST or the use of CREST in relation to the Placing, the Company and the Bookrunner may agree that the Placing Shares (or any of them) should be issued in certificated form.  The Bookrunner reserves the right to require settlement for any of the Placing Shares, and to deliver any of the Placing Shares to any Placees, by such other means as it deems necessary if delivery or settlement to any Placee is not practicable within the CREST system or would not be consistent with regulatory requirements in the jurisdiction in which a Placee is located.

Interest is chargeable daily on payments not received from Placees on or before the due date in accordance with the arrangements set out above, in respect of either CREST or certificated deliveries, at the rate of 3 percentage points above prevailing base rate of Barclays Bank plc as determined by the Bookrunner.

Each Placee is deemed to agree that if it does not comply with these obligations, the Bookrunner may sell, charge by way of security (to any funder of the Bookrunner) or otherwise deal with any or all of their Placing Shares on their behalf and retain from the proceeds, for the Bookrunner's own account and benefit, an amount equal to the aggregate amount owed by the Placee plus any interest due and any costs and expenses properly incurred by the Bookrunner as a result of the Placee's failure to comply with its obligations. The relevant Placee will, however, remain liable for any shortfall below the Issue Price and for any stamp duty or stamp duty reserve tax (together with any interest or penalties) which may arise upon the sale of its Placing Shares on its behalf. Legal and/or beneficial title in and to any Placing Shares shall not pass to the relevant Placee until such time as it has fully complied with its obligations hereunder.

If Placing Shares are to be delivered to a custodian or settlement agent, Placees must ensure that, upon receipt, any relevant contract note is copied and delivered immediately to the relevant person within that organisation. Insofar as Placing Shares are registered in a Placee's name or that of its nominee or in the name of any person for whom a Placee is contracting as agent or that of a nominee for such person, such Placing Shares should, subject as provided below, be so registered free from any liability to United Kingdom stamp duty or stamp duty reserve tax. Placees will not be entitled to receive any fee or commission in connection with the Placing.

Conditions of the Placing

The Placing is conditional upon the Placing Agreement becoming unconditional and not having been terminated in accordance with its terms.

Subject to the proviso that once Admission has occurred no party to the Placing Agreement shall be entitled to terminate any part of the Placing Agreement which relates to Admission and/or the placing, allotment or issue of the/New Ordinary Shares, the obligations of the Bookrunner under the Placing Agreement are, and the Placing is, conditional upon, inter alia:

(a)  the Resolutions being passed at the General Meeting (in relation to Second Admission of the Conditional Placing Shares only);

(b)   the warranties and undertakings contained in the Placing Agreement ("Warranties") being true, accurate and not misleading when made on the date of the Placing Agreement and immediately prior to Admission by reference to the facts and circumstances subsisting at that time;

(c)  the Company having fully performed its obligations under the Placing Agreement to the extent that they fall to be performed prior to Admission;

(d)   the obligations of the Bookrunner not having been terminated pursuant to any provision of the Placing Agreement prior to Admission; and

(e)  Admission having become effective at or around the relevant Admission Date,

all conditions to the obligations of the Bookrunner included in the Placing Agreement being together, the "conditions").

If any of the conditions are not fulfilled or, where permitted, waived in accordance with the Placing Agreement within the stated time periods (or such later time and/or date as the Company and the Bookrunner may agree), or the Placing Agreement is terminated in accordance with its terms, the Placing (or such part of it as may then remain to be completed) will lapse and the Placee's rights and obligations shall cease and terminate at such time and each Placee agrees that no claim can be made by or on behalf of the Placee (or any person on whose behalf the Placee is acting) in respect thereof.

By participating in the Placing, each Placee agrees that its rights and obligations cease and terminate only in the circumstances described above and under "Termination of the Placing" below and will not be capable of rescission or termination by it.

The Bookrunner may, in its absolute discretion and upon such terms as it thinks fit, waive fulfilment of all or any of the conditions in the Placing Agreement in whole or in part, or extend the time provided for fulfilment of one or more conditions, save that certain conditions may not be waived.  Any such extension or waiver will not affect Placees' commitments as set out in these Terms and Conditions.

The Bookrunner may terminate the Placing Agreement in certain circumstances, details of which are set out below.

Neither the Bookrunner nor any of their respective affiliates, agents, advisers, directors, officers or employees nor the Company shall have any liability to any Placee (or to any other person whether acting on behalf of a Placee or otherwise) in respect of any decision any of them may make as to whether or not to waive or to extend the time and/or date for the satisfaction of any condition to the Placing (or any part thereof) nor for any decision any of them may make as to the satisfaction of any condition or in respect of the Placing generally (or any part thereof) and by participating in the Placing each Placee agrees that any such decision is within the absolute discretion of the Bookrunner.

Termination of the Placing

If in the Bookrunner's reasonable opinion:

(a)        the Company is in breach of any of its obligations under the Placing Agreement, or is likely to be so in breach, or cannot comply with any such obligation, or is unlikely to able to do so; or any warranty is or if repeated at

(b)        any time up to Admission (by reference to the facts and circumstances then existing) would be untrue, inaccurate or misleading; or

(c)        there has been an adverse development or other adverse occurrence relating to any director or any group member (whether or not occurring or arising before or after the date of the Placing Agreement) of which the Bookrunner was unaware when entering into the Placing Agreement, (in any case by itself or together with any other such occurrence) to an extent which the Bookrunner reasonably regards as material; or

(d)        on or after the date of the Placing Agreement there happens, develops or comes into effect:

i.              a general moratorium on commercial banking activities in London or New York declared by the relevant authorities or a material disruption in commercial banking or securities settlement or clearance services in the United Kingdom, any member state of the EEA or the United States; or

ii.             the declaration, outbreak or escalation of war or other hostilities, or the occurrence of any acts of terrorism, involving the United Kingdom or the United States or the declaration by or for the government of the United Kingdom or the United States of a national emergency; or

iii.            any calamity, disaster, natural event or other occurrence of any kind which (by itself or together with any other such occurrence) in the Bookrunner's reasonable opinion is likely to materially and adversely affect or prejudice the market's perception of the Company or the financial position or trading position or prospects of the Group taken as a whole; or

iv.            a change, or any development likely to involve a prospective change (in each case whether or not foreseeable at the date of the Placing Agreement) in or affecting the condition (financial or other), business prospects, earnings, business affairs or results of the Group, whether or not arising in the ordinary course of business which, in any such case, in the Bookrunner's reasonable opinion is materially adverse; or

v.             any crisis of international or national effect or any change in any currency exchange rates or controls or in any financial, political, economic or market conditions (including disruption to trading on any stock exchange, multilateral trading facility or over-the-counter market) or in market sentiment or any other calamity or crisis which, in any such case, in the Bookrunner's reasonable opinion is materially adverse; or the suspension or limitation of trading generally on the London Stock Exchange, the American Stock Exchange, the New York Stock Exchange, the NASDAQ National Market or any other market operated within the United Kingdom that is a "prescribed market" for the purpose of section 118 of FSMA or the fixing of any minimum or maximum prices or price ranges for any such trading; or

vi.            a change or development involving a prospective change in taxation affecting any Group Member, the Placing or the holding or ownership or transfer of any Ordinary Shares which, in any such case, in the Bookrunner's reasonable opinion is materially adverse; or

vii.           the imposing of exchange controls by the United Kingdom, any member state of the EEA, the United States or China,

the Bookrunner may terminate its obligations under the Placing Agreement with immediate effect by notice in writing delivered to the Company or (if such delivery is not practicable in the circumstances) by a verbal communication to any Director (such communication to be confirmed in writing by the Bookrunner as soon as reasonably practicable afterwards), such delivery or communication to be made before Admission.

If the Placing Agreement is terminated in accordance with its terms, the rights and obligations of each Placee in respect of the Placing as described in these Terms and Conditions shall cease and terminate at such time and no claim can be made by any Placee in respect thereof.

By participating in the Placing, each Placee agrees with the Company and the Bookrunner that the exercise by the Company or the Bookrunner of any right of termination or any other right or other discretion under the Placing Agreement shall be within the absolute discretion of the Company or the Bookrunner or for agreement between the Company and the Bookrunner (as the case may be) and that neither the Company nor the Bookrunner need make any reference to such Placee and that none of the Company, the Bookrunner nor any of their respective affiliates, agents, advisers, directors, officers or employees shall have any liability to such Placee (or to any other person whether acting on behalf of a Placee or otherwise) whatsoever in connection with any such exercise.

By agreeing with the Bookrunner (as agent of the Company) to subscribe for Placing Shares under the Placing, a Placee (and any person acting on a Placee's behalf) will irrevocably acknowledge and confirm and warrant and undertake to, and agree with, each of the Company and the Bookrunner, in each case as a fundamental term of such Placee's application for Placing Shares and of the Company's obligation to allot and/or issue any Placing Shares to it or at its direction, that its rights and obligations in respect of the Placing (or any part of it) will terminate only in the circumstances described above and under the "Conditions of the Placing" section above and will not be capable of rescission or termination by it in any other circumstances.

Representations, warranties and further terms

By participating in the Placing, each Placee (and any person acting on such Placee's behalf) represents, warrants, acknowledges, undertakes, confirms and agrees (for itself and for any such prospective Placee) that (save where the Bookrunner (or the Company with the express approval of the Bookrunner) specifically and expressly agrees in writing to the contrary):

1.            it has read and understood the Announcement and these Terms and Conditions in their entirety and its acquisition of Placing Shares is subject to and based upon all the terms, conditions, representations, warranties, indemnities, acknowledgements, agreements and undertakings and other information contained herein and it has not relied on, and will not rely on, any information given or any representations, warranties or statements made at any time by any person in connection with Admission, the Placing, the Company, the Placing Shares or otherwise, other than the information contained in the Announcement and the Publicly Available Information;

2.            it has not received a prospectus or other offering document in connection with the Placing and acknowledges that no prospectus or other offering document:

(a)           is required under any applicable law; and

(b)           has been or will be prepared in connection with the Placing

and, in particular, that the Subscription and Retail Offer referred to in the Announcement and the Circular relating thereto are separate from the Placing and do not form part of any offer or agreement concerning the Placing and/or any Placing Shares;

3.            the Ordinary Shares are admitted to trading on AIM, and that the Company is therefore required to publish certain business and financial information in accordance with the AIM Rules and the Market Abuse Regulation (EU Regulation No. 596/2014, as retained and applicable in the UK pursuant to s3 of the European Union (Withdrawal) Act 2018 (the "MAR")), which includes a description of the nature of the Company's business and the Company's most recent balance sheet and profit and loss account and that it is able to obtain or access such information without undue difficulty, and is able to obtain access to such information or comparable information concerning any other publicly traded company, without undue difficulty;

4.            it has made its own assessment of the Placing Shares and has relied on its own investigation of the business, financial position and other aspects of the Company in accepting a participation in the Placing and neither the Bookrunner nor the Company nor any of their respective affiliates, agents, advisers, directors, officers or employees nor any person acting on behalf of any of them has provided, and will not provide, it with any material regarding the Placing Shares or the Company or any other person other than the information in the Announcement and these Terms and Conditions or the Publicly Available Information; nor has it requested either of the Bookrunner, the Company, any of their respective affiliates, agents, advisers, directors, employees or officers or any person acting on behalf of any of them to provide it with any such information;

5.            neither the Bookrunner nor any person acting on behalf of them nor any of their respective affiliates, agents, directors, officers or employees has or shall have any liability for any Publicly Available Information, or any representation relating to the Company, provided that nothing in these Terms and Conditions excludes the liability of any person for any fraudulent misrepresentation made by that person;

6.           (a)         the only information on which it is entitled to rely on and on which it has relied in committing to acquire the Placing Shares is contained in this Announcement and the Publicly Available Information, such information being all that it deems necessary to make an investment decision in respect of the Placing Shares and it has made its own assessment of the Company, the Placing Shares and the terms of the Placing based on this Announcement and the Publicly Available Information;

(b)           neither the Bookrunner nor any of their respective affiliates, agents, directors, officers or employees have made any representation or warranty to it, express or implied, with respect to the Company, the Placing or the Placing Shares or the accuracy, completeness or adequacy of this Announcement, the Circular or the Publicly Available Information;

(c)           it has conducted its own investigation of the Company, the Placing and the Placing Shares, satisfied itself that the information is still current and relied on that investigation for the purposes of its decision to participate in the Placing; and

(d)         it has not relied on any investigation that the Bookrunner or any person acting on their behalf may have conducted with respect to the Company, the Placing or the Placing Shares;

7.            the contents of this Announcement, the Circular and the other Publicly Available Information as well as any information made available (in written or oral form) in presentations or as part of roadshow discussions with investors relating to the Company (the "Information") has been prepared by and is exclusively the responsibility of the Company and neither the Bookrunner nor any persons acting on their behalf is responsible for or has or shall have any liability for any such Information, or for any representation, warranty or statement relating to the Company contained therein nor will they be liable for any Placee's decision to participate in the Placing based on any Information or any representation, warranty or statement contained therein or otherwise;

8.            it has the funds available to pay for the Placing Shares which it has agreed to acquire and acknowledges and agrees that it will pay the total subscription amount in accordance with the Announcement and  these Terms and Conditions by the due time and date set out herein, failing which the relevant Placing Shares may be placed with other Placees or sold at such price as the Bookrunner determines;

9.             the Placing Shares have not been registered or otherwise qualified, and will not be registered or otherwise qualified, for offer and sale nor will a prospectus be cleared or approved in respect of any of the Placing Shares under the securities laws of the United States, or any state or other jurisdiction of the United States, the Republic of Ireland, Australia, New Zealand, Canada, Republic of South Africa, Japan or any member state of the EEA and, subject to certain exceptions, may not be offered, sold, taken up, renounced or delivered or transferred, directly or indirectly, within the United States, the Republic of Ireland, Australia, New Zealand, Canada, the Republic of South Africa, Japan, any member of the EEA or in any country or jurisdiction where any such action for that purpose is required;

10.         it and/or each person on whose behalf it is participating:

(a)           is entitled to acquire Placing Shares pursuant to the Placing under the laws and regulations of all relevant jurisdictions;

(b)           has fully observed such laws and regulations;

(c)           has capacity and authority and is entitled to enter into and perform its obligations as an acquirer of Placing Shares and will honour such obligations; and

(d)           has obtained all necessary consents and authorities (including, without limitation, in the case of a person acting on behalf of a Placee, all necessary consents and authorities to agree to the terms set out or referred to in these Terms and Conditions) under those laws or otherwise and complied with all necessary formalities to enable it to enter into the transactions contemplated hereby and to perform its obligations in relation thereto and, in particular, if it is a pension fund or investment company it is aware of and acknowledges it is required to comply with all applicable laws and regulations with respect to its acquisition of Placing Shares;

11.          it is not, and any person who it is acting on behalf of is not, and at the time the Placing Shares are acquired will not be, a resident of, or with an address in, or subject to the laws of, Australia, Canada, the Republic of South Africa, the Republic of Ireland, New Zealand, Japan or any member state of the EEA, and it acknowledges and agrees that the Placing Shares have not been and will not be registered or otherwise qualified under the securities legislation of Australia, Canada, the Republic of South Africa, the Republic of Ireland, New Zealand, Japan or any member state of the EEA and may not be offered, sold, or acquired, directly or indirectly, within those jurisdictions;,

12.          it and the beneficial owner of the Placing Shares is, and at the time the Placing Shares are acquired will be, outside the United States and acquiring the Placing Shares in an "offshore transaction" as defined in, and in accordance with, Regulation S under the Securities Act;

13.          it understands that the Placing Shares have not been, and will not be, registered under the Securities Act and may not be offered, sold or resold in or into or from the United States except pursuant to an effective registration under the Securities Act, or pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act and in accordance with applicable state securities laws; and no representation is being made as to the availability of any exemption under the Securities Act for the reoffer, resale, pledge or transfer of the Placing Shares;

14.          it (and any account for which it is purchasing) is not acquiring the Placing Shares with a view to any offer, sale or distribution thereof within the meaning of the Securities Act;

15.          it understands that:

(a)           the Placing Shares are "restricted securities" within the meaning of Rule 144(a)(3) under the Securities Act and will be subject to restrictions on resale and transfer subject to certain exceptions under US law; and

(b)           it will not deposit the Placing Shares in an unrestricted depositary receipt programme in the United States or for US persons (as defined in the Securities Act);

16.          it will not offer, sell, transfer, pledge or otherwise dispose of any Placing Shares except:

(a)           in an offshore transaction in accordance with Rules 903 or 904 of Regulation S under the Securities Act; or

(b)           pursuant to another exemption from registration under the Securities Act, if available,

and in each case in accordance with all applicable securities laws of the states of the United States and all other applicable jurisdictions;

17.          no representation has been made as to the availability of the exemption provided by Rule 144, Rule 144A or any other exemption under the Securities Act for the reoffer, resale, pledge or transfer of the Placing Shares;

18.           it understands that the Placing Shares are expected to be issued to it through CREST but may be issued to it in certificated, definitive form and acknowledges and agrees that the Placing Shares will, to the extent they are delivered in certificated form, bear a legend to the following effect unless agreed otherwise with the Company and the Bookrunner:

"THESE SECURITIES HAVE NOT BEEN AND WILL NOT BE REGISTERED UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), OR UNDER THE APPLICABLE SECURITIES LAWS OR WITH ANY SECURITIES REGULATORY AUTHORITY OF ANY STATE OR OTHER JURISDICTION OF THE UNITED STATES, AND MAY NOT BE OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED EXCEPT (A) PURSUANT TO A REGISTRATION STATEMENT WHICH HAS BEEN DECLARED EFFECTIVE UNDER THE SECURITIES ACT, (B) IN AN OFFSHORE TRANSACTION IN ACCORDANCE WITH RULE 903 OR RULE 904 OF REGULATION S UNDER THE SECURITIES ACT OR (C) PURSUANT TO ANY OTHER AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND, IN EACH CASE, IN ACCORDANCE WITH ANY APPLICABLE SECURITIES LAWS OF ANY STATE OR OTHER JURISDICTION OF THE UNITED STATES.  NOTWITHSTANDING ANYTHING TO THE CONTRARY IN THE FOREGOING, THE SECURITIES MAY NOT BE DEPOSITED INTO ANY UNRESTRICTED DEPOSITARY RECEIPT FACILITY IN RESPECT OF THE COMPANY'S SECURITIES ESTABLISHED OR MAINTAINED BY A DEPOSITARY BANK.  EACH HOLDER, BY ITS ACCEPTANCE OF THESE SHARES, REPRESENTS THAT IT UNDERSTANDS AND AGREES TO THE FOREGOING RESTRICTIONS.";

19.          it is not taking up the Placing Shares as a result of any "general solicitation" or "general advertising" efforts (as those terms are defined in Regulation D under the Securities Act) or any "directed selling efforts" (as such term is defined in Regulation S under the Securities Act);

20.          if located in the United States, it understands that there may be certain consequences under United States and other tax laws resulting from an investment in the Placing and it has made such investigation and has consulted its own independent advisers or otherwise has satisfied itself concerning, without limitation, the effects of United States federal, state and local income tax laws and foreign tax laws generally;

21.          it will not distribute, forward, transfer or otherwise transmit this Announcement or these Terms and Conditions and/or the Circular or any part of them, or any other presentational or other materials concerning the Placing in or into or from the United States (including electronic copies thereof) to any person, and it has not distributed, forwarded, transferred or otherwise transmitted any such materials to any person;

22.          none of the Bookrunner, their respective affiliates and/or any person acting on behalf of any of them is making any recommendations to it or advising it regarding the suitability of any transactions it may enter into in connection with the Placing and that participation in the Placing is on the basis that it is not and will not be a client of the Bookrunner and that the Bookrunner has no duties or responsibilities to it for providing the protections afforded to its clients or for providing advice in relation to the Placing nor in respect of any representations, warranties, undertakings or indemnities contained in the Placing Agreement nor for the exercise or performance of any of its rights and obligations thereunder including any rights to waive or vary any conditions or exercise any termination right;

23.          it will make payment to the Bookrunner for the Placing Shares allocated to it in accordance with these Terms and Conditions on or by the specified time (being the Admission Date), failing which the relevant Placing Shares may be placed with others on such terms as the Bookrunner determines in its absolute discretion without liability to the Placee and it will remain liable for any shortfall below the net proceeds of such sale and the placing proceeds of such Placing Shares and may be required to bear any stamp duty or stamp duty reserve tax (together with any interest or penalties due pursuant to the terms set out or referred to in these Terms and Conditions) which may arise upon the sale of such Placee's Placing Shares on its behalf;

24.          its Recorded Commitment to acquire Placing Shares will represent a maximum number of Placing Shares which it may be required to subscribe for, and that following the allocation process the Bookrunner may call upon it to subscribe for a lower number of Placing Shares (if any), but in no event in aggregate more than the aforementioned maximum;

25.          no action has been or will be taken by any of the Company, the Bookrunner or any person acting on behalf of the Company or the Bookrunner that would, or is intended to, permit a public offer of the Placing Shares in the United States or in any country or jurisdiction where any such action for that purpose is required;

26.          the person who it specifies for registration as holder of the Placing Shares will be:

(a)           the Placee; or

(b)           a nominee of the Placee, as the case may be. 

27.          neither the Bookrunner nor the Company will be responsible for any liability to stamp duty or stamp duty reserve tax resulting from a failure to observe the above requirement.  Each Placee and any person acting on behalf of such Placee agrees to acquire Placing Shares pursuant to the Placing and agrees to indemnify the Company and the Bookrunner in respect of the same on the basis that the Placing Shares will be allotted to a CREST stock account of the Bookrunner or transferred to a CREST stock account of the Bookrunner who will hold them as nominee on behalf of the Placee until settlement in accordance with its standing settlement instructions with it;

28.          the allocation, allotment, issue and delivery to it, or the person specified by it for registration as holder, of Placing Shares will not give rise to a stamp duty or stamp duty reserve tax liability under (or at a rate determined under) any of sections 67, 70, 93 or 96 of the Finance Act 1986 (depository receipts and clearance services) and it is not participating in the Placing as nominee or agent for any person or persons to whom the allocation, allotment, issue or delivery of Placing Shares would give rise to such a liability;

29.          if it is within the United Kingdom, it and any person acting on its behalf (if within the United Kingdom) falls within Article 19(5) and/or 49(2) of the Order and undertakes that it will acquire, hold, manage and (if applicable) dispose of any Placing Shares that are allocated to it for the purposes of its business only;

30.          it has not offered or sold and will not offer or sell any Placing Shares to persons in the United Kingdom or any member state in the EEA except to persons whose ordinary activities involve them in acquiring, holding, managing or disposing of investments (as principal or agent) for the purposes of their business or otherwise in circumstances which have not resulted, and which will not result in an offer to the public in the United Kingdom within the meaning of section 85(1) of the FSMA or an offer to the public in any member state of the EEA within the meaning of the EU Prospectus Regulation;

31.          it has only communicated or caused to be communicated and it will only communicate or cause to be communicated any invitation or inducement to engage in investment activity (within the meaning of section 21 of the FSMA) relating to Placing Shares in circumstances in which section 21(1) of the FSMA does not require approval of the communication by an authorised person and it acknowledges and agrees that neither the Announcement, these Terms and Conditions nor the Circular has been or will be approved by the Bookrunner in their capacity as an authorised person under section 21 of the FSMA and it may not therefore be subject to the controls which would apply if it was made or approved as financial promotion by an authorised person;

32.          it has complied, and it will comply with all applicable laws in any jurisdiction with respect to anything done by it or on its behalf in relation to the Placing Shares (including all relevant provisions of the FSMA in respect of anything done in, from or otherwise involving the United Kingdom);

33.          if it is a financial intermediary, as that term is used in the UK Prospectus Regulation, the Placing Shares acquired by it in the Placing will not be acquired on a non-discretionary basis on behalf of, nor will they be acquired with a view to their offer or resale to persons in the United Kingdom other than Qualified Investors or in circumstances in which the express prior written consent of the Bookrunner has been given to the offer or resale;

34.          if in the United Kingdom, it is a Qualified Investor within the meaning of the UK Prospectus Regulation and a person (i) having professional experience in matters relating to investments and who falls within the definition of 'investment professionals' in Article 19(5) of the Order; or (ii) who is a high net worth entity falling within Article 49(2)(a) to (d) of the Order; or (iii) to whom this document may otherwise lawfully be communicated;

35.          if it is a financial intermediary, as that term is used in the EU Prospectus Regulation (including any relevant implementing measure in any member state), the Placing Shares acquired by it in the Placing will not be acquired on a non-discretionary basis on behalf of, nor will they be acquired with a view to their offer or resale to, persons in any member state of the EEA other than Qualified Investors, or in circumstances in which the express prior written consent of the Bookrunner has been given to the offer or resale;

36.          if in a member state of the EEA, it is a "Qualified Investor" within the meaning of the EU Prospectus Regulation;

37.          it has neither received nor relied on any confidential price sensitive information about the Company not included in this document in accepting this invitation to participate in the Placing;

38.          if it has received any inside information (for the purposes of the MAR and/or section 56 of the Criminal Justice Act 1993 or other applicable law) about the Company in advance of the Placing, it has not:

(a)           dealt (or attempted to deal) in the securities of the Company;

(b)           encouraged, recommended or induced another person to deal in the securities of the Company; or

(c)           unlawfully disclosed such information to any person, prior to the information being made publicly available;

39.          subject to paragraph (40), none of the monies being invested in the Placing by it is State Aid. For the purposes of these Terms and Conditions:

"State Aid" means any aid, investment, grant or loan which was received by the recipient pursuant to a measure approved by the European Commission as compatible with Article 107 of the Treaty on the Functioning of the European Union in accordance with the principles laid down in the European Commission's Guidelines on State aid to promote risk finance investments (as those guidelines may be amended or replaced from time to time); and

40.          if it cannot give the warranty in paragraph (39), it is a condition of its participation in the Placing that it provides written confirmation to the Bookrunner as to the amount of money being invested in the Placing by it which will be State Aid;

41.          neither the Bookrunner nor any of its advisers, affiliates, agents, directors, officers or employees or any person acting on behalf of any of them has or shall have any liability for any information, representation or statement contained in this document or for any information previously published by or on behalf of the Company or any other written or oral information made available to or publicly available or filed information or any representation, warranty or undertaking relating to the Company, and will not be liable for its decision to participate in the Placing based on any information, representation, warranty or statement contained in this document or elsewhere, provided that nothing in this paragraph shall exclude any liability of any person for fraud;    

42.          neither the Bookrunner, the Company nor any of their respective affiliates, agents, advisers, directors, officers or employees nor any person acting on behalf of the Bookrunner or their respective affiliates, agents, advisers, directors, officers or employees nor any person acting on behalf of any of them is making any recommendations to it, advising it regarding the suitability of any transactions it may enter into in connection with the Placing nor providing advice in relation to the Placing nor in respect of any representations, warranties, acknowledgements, agreements, undertakings, or indemnities contained in the Placing Agreement nor the exercise or performance of any of the Bookrunner's rights and obligations thereunder including any rights to waive or vary any conditions or exercise any termination right;

43.          the Bookrunner may, in accordance with applicable legal and regulatory provisions, engage in transactions in relation to the Placing Shares and/or related instruments for their own account and, except as required by applicable law or regulation, the Bookrunner will not make any public disclosure in relation to such transactions;

44.          the Bookrunner and their respective affiliates, acting as an investor for its or their own account(s), may bid or subscribe for and/or purchase Placing Shares and, in that capacity, may retain, purchase, offer to sell or otherwise deal for its or their own account(s) in the Placing Shares, any other securities of the Company or other related investments in connection with the Placing or otherwise.  Accordingly, references in these Terms and Conditions and/or the Announcement to the Placing Shares being offered, subscribed, acquired or otherwise dealt with should be read as including any offer to, or subscription, acquisition or dealing by, the Bookrunner and/or any of their respective affiliates acting as an investor for its or their own account(s).  Neither the Bookrunner nor the Company intend to disclose the extent of any such investment or transaction otherwise than in accordance with any legal or regulatory obligation to do so;

45.          it:

(a)           has complied, and will comply, with its obligations in connection with money laundering and terrorist financing under the Proceeds of Crime Act 2002, the Terrorism Act 2000 (as amended), the Terrorism Act 2006 and the Money Laundering, Terrorist Financing and Transfer of Funds (Information on the Payer) Regulations 2017;

(b)           is not a person:

(i)         with whom transactions are prohibited under the US Foreign Corrupt Practices Act of 1977 or any economic sanction programmes administered by, or regulations promulgated by, the Office of Foreign Assets Control of the U.S. Department of the Treasury;

(ii)         named on the Consolidated List of Financial Sanctions Targets maintained by HM Treasury of the United Kingdom; or

(iii)        subject to financial sanctions imposed pursuant to a regulation of the European Union or a regulation adopted by the United Nations or other applicable law,

(all such statutes, rules and regulations referred to in this paragraph 45 together, the "Regulations") and if making payment on behalf of a third party, that satisfactory evidence has been obtained and recorded by it to verify the identity of the third party as required by the Regulations and has obtained all governmental and other consents (if any) which may be required for the purpose of, or as a consequence of, such purchase, and it will provide promptly to the Bookrunner such evidence, if any, as to the identity or location or legal status of any person which it may request from it in connection with the Placing (for the purpose of complying with the Regulations or ascertaining the nationality of any person or the jurisdiction(s) to which any person is subject or otherwise) in the form and manner requested by the Bookrunner on the basis that any failure by it to do so may result in the number of Placing Shares that are to be acquired by it or at its direction pursuant to the Placing being reduced to such number, or to nil, as the Bookrunner may decide at its sole discretion;

46.          in order to ensure compliance with the Regulations, the Bookrunner (for itself and as agent on behalf of the Company) or the Company's registrars may, in their absolute discretion, require verification of its identity.  Pending the provision to the Bookrunner or the Company's registrars, as applicable, of evidence of identity, definitive certificates in respect of the Placing Shares may be retained at the Bookrunner's  absolute discretion or, where appropriate, delivery of the Placing Shares to it in uncertificated form may be delayed at the Bookrunner or the Company's registrars', as the case may be, absolute discretion. If within a reasonable time after a request for verification of identity the Bookrunner (for itself and as agent on behalf of the Company) or the Company's registrars have not received evidence satisfactory to them, either the Bookrunner and/or the Company may, at its absolute discretion, terminate its commitment in respect of the Placing, in which event the monies payable on acceptance of allotment will, if already paid, be returned without interest to the account of the drawee's bank from which they were originally debited;

47.          its commitment to acquire Placing Shares on the Terms and Conditions will continue notwithstanding any amendment that may in future be made to the terms and conditions of the Placing and that Placees will have no right to be consulted or require that their consent be obtained with respect to the Company's or the Bookrunner's conduct of the Placing;

48.          neither of the Bookrunner nor any of their respective affiliates, agents, advisers, directors, officers or employees makes any representation in respect of or shall have any responsibility for the tax treatment that any Placee may receive or expect in relation to their investment in Placing Shares;

49.          it has knowledge and experience in financial, business and international investment matters as is required to evaluate the merits and risks of acquiring the Placing Shares.  It further acknowledges that it is experienced in investing in securities of this nature and is aware that it may be required to bear, and is able to bear, the economic risk of, and is able to sustain, a complete loss in connection with the Placing.  It has relied upon its own examination and due diligence of the Company and its affiliates taken as a whole, and the terms of the Placing, including the merits and risks involved;

50.          it irrevocably appoints any duly authorised officer of the Bookrunner as its agent for the purpose of executing and delivering to the Company and/or its registrars any documents on its behalf necessary to enable it to be registered as the holder of any of the Placing Shares which it agrees to acquire upon these Terms and Conditions;

51.                          the Company, the Bookrunner and others (including each of their respective affiliates, agents, advisers, directors, officers and employees) will rely upon the truth and accuracy of the foregoing representations, warranties, acknowledgements and agreements, which are given to the Bookrunner on their own behalf and on behalf of the Company and are irrevocable;

52.                          it is acting as principal only in respect of the Placing or, if it is acquiring the Placing Shares as a fiduciary or agent for one or more investor accounts, it is duly authorised to do so and it has full power and authority to make, and does make, the foregoing representations, warranties, acknowledgements, agreements and undertakings on behalf of each such accounts;

53.          neither it nor, as the case may be, its clients expect the Bookrunner to have any duties or responsibilities to such persons similar or comparable to the duties of "best execution" and "suitability" imposed by the FCA's Conduct of Business Source Book, and that the Bookrunner is not acting for it or its clients, and that the Bookrunner will not be responsible for providing the protections afforded to customers of the Bookrunner or for providing advice in respect of the transactions described herein;

54.          it is a "professional client" or an "eligible counterparty" within the meaning of Chapter 3 of the FCA's Conduct of Business Sourcebook and it is purchasing Placing Shares for investment only and not with a view to resale or distribution;

55.          it will (or will procure that its nominee will) if applicable, make notification to the Company of the interest in its Ordinary Shares in accordance with the Disclosure Guidance and Transparency Rules published by the FCA;

56.          as far as it is aware, it is not acting in concert (within the meaning given in the Takeover Code) with any other person in relation to the Company and it is not a related party of the Company for the purposes of the AIM Rules;

57.          it is responsible for obtaining any legal, tax and other advice that it deems necessary for the execution, delivery and performance of its obligations in accepting the terms and conditions of the Placing, and that it is not relying on the Company or the Bookrunner to provide any legal, tax or other advice to it;

58.          neither of the Bookrunner nor any of their respective affiliates, agents, advisers, directors, officers or employees makes any representation in respect of or shall have any responsibility for the tax treatment that any Placee may receive or expect in relation to their investment in Placing Shares;

59.          it will not distribute any document relating to the Placing Shares and it will be acquiring the Placing Shares for its own account as principal or for a discretionary account or accounts (as to which it has the authority to make the statements set out herein) for investment purposes only;

60.          it is acquiring the Placing Shares for its own account or is acquiring the Placing Shares for an account with respect to which it exercises sole investment discretion and has the authority to make and does make the representations, warranties, indemnities, acknowledgements, undertakings and agreements contained in this document;

61.          it accepts and acknowledges that:

(i)            if the Placing does not proceed and/or the conditions to the Bookrunner's obligations in respect of the Placing under the Placing Agreement are not satisfied and/or the Placing Agreement is terminated prior to Admission for any reason whatsoever and/or the Placing Shares are not admitted to trading on AIM for any reason whatsoever, none of the Company, the Bookrunner nor any of their respective affiliates, nor persons controlling, controlled by or under common control with any of them nor any of their respective employees, agents, officers, members, stockholders, partners or representatives, shall have any liability whatsoever to it or any other person;

(ii)           the Bookrunner is entitled to exercise any of its rights under the Placing Agreement or any other right in its absolute discretion, including the right to terminate the Placing Agreement without any liability whatsoever to it (or any person on whose behalf it is acting) and the Bookrunner shall not have any obligation to consult or notify Placees in relation to any right or discretion given to it or which it is entitled to exercise; and

(iii)          if such right is exercised by the Bookrunner, the Placing (and the arrangements associated with it) will lapse and any monies received in respect of the Placing will be returned to Placees without interest;

62.          it acknowledges that no person is authorised in connection with the Placing to give any information or make any representation other than as contained in this document and, if given or made, any information or representation must not be relied upon as having been authorised by the Bookrunner or the Company;

63.          time is of the essence as regards its obligations under these Terms and Conditions;

64.          any document that is to be sent to it in connection with the Placing will be sent at its risk and may be sent to it at any address provided by it to the Bookrunner;

65.          the Placing Shares will be issued subject to these Terms and Conditions; and

66.          these Terms and Conditions and all documents into which these Terms and Conditions are incorporated by reference or otherwise validly forms a part and/or any agreements entered into pursuant to these terms and conditions and all agreements to acquire Placing Shares pursuant to the Placing will be governed by and construed in accordance with English law and it submits to the exclusive jurisdiction of the English courts in relation to any claim, dispute (contractual or otherwise) or matter arising out of or in connection with such contract except that enforcement proceedings in respect of the obligation to make payment for the Placing Shares (together with interest chargeable thereon) may be taken by the Company or the Bookrunner in any jurisdiction in which the relevant Placee is incorporated or in which any of its securities have a quotation on a recognised stock exchange.

By participating in the Placing, each Placee (and any person acting on such Placee's behalf) agrees to indemnify and hold the Company, the Bookrunner and each of their respective affiliates, agents, directors, officers and employees harmless from any and all costs, claims, liabilities and expenses (including legal fees and expenses) arising out of or in connection with any breach of the representations, warranties, acknowledgements, agreements and undertakings given by the Placee (and any person acting on such Placee's behalf) in these Terms and Conditions or incurred by either of the Bookrunner, the Company or any of their respective affiliates, agents, directors, officers or employees arising from the non-performance of the Placee's obligations as set out in these Terms and Conditions, and further agrees that the provisions of these Terms and Conditions shall survive after the completion of the Placing.

The agreement to allot and issue Placing Shares to Placees (or the persons for whom Placees are contracting as agent) free of stamp duty and stamp duty reserve tax in the United Kingdom relates only to their allotment and issue to Placees, or such persons as they nominate as their agents, direct by the Company.  Such agreement assumes that the Placing Shares are not being acquired in connection with arrangements to issue depositary receipts or to transfer the Placing Shares into a clearance service.  If there are any such arrangements, or the settlement related to any other dealings in the Placing Shares, stamp duty or stamp duty reserve tax may be payable.  In that event, the Placee agrees that it shall be responsible for such stamp duty or stamp duty reserve tax and neither the Company nor the Bookrunner shall be responsible for such stamp duty or stamp duty reserve tax.  If this is the case, each Placee should seek its own advice and they should notify the Bookrunner accordingly.  In addition, Placees should note that they will be liable for any capital duty, stamp duty and all other stamp, issue, securities, transfer, registration, documentary or other duties or taxes (including any interest, fines or penalties relating thereto) payable outside the United Kingdom by them or any other person on the acquisition by them of any Placing Shares or the agreement by them to acquire any Placing Shares and each Placee, or the Placee's nominee, in respect of whom (or in respect of the person for whom it is participating in the Placing as an agent or nominee) the allocation, allotment, issue or delivery of Placing Shares has given rise to such non-United Kingdom stamp, registration, documentary, transfer or similar taxes or duties undertakes to pay such taxes and duties, including any interest and penalties (if applicable), forthwith and to indemnify on an after-tax basis and to hold harmless the Company and the Bookrunner in the event that any of the Company and/or the Bookrunner have incurred any such liability to such taxes or duties.

The representations, warranties, acknowledgements and undertakings contained in these Terms and Conditions are given to the Bookrunner for itself and on behalf of the Company and are irrevocable.

The Bookrunner is authorised and regulated by the FCA in the United Kingdom and is acting exclusively for the Company and no one else in connection with the Placing, and will not be responsible to anyone (including any Placees) other than the Company for providing the protections afforded to their clients or for providing advice in relation to the Placing or any other matters referred to in these Terms and Conditions.

Each Placee and any person acting on behalf of the Placee acknowledges that the Bookrunner does not owe any fiduciary or other duties to any Placee in respect of any representations, warranties, undertakings, acknowledgements, agreements or indemnities in the Placing Agreement.

The provisions of these Terms and Conditions may be varied, waived or modified as regards specific Placees or on a general basis by the Bookrunner provided always that such variation, waiver or modification is not materially prejudicial to the interests of the Company.

In the case of a joint agreement to acquire Placing 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.

Each Placee and any person acting on behalf of the Placee acknowledges and agrees that the Bookrunner may (at its absolute discretion) satisfy its obligations to procure Placees by itself agreeing to become a Placee in respect of some or all of the Placing Shares or by nominating any connected or associated person to do so.

When a Placee or any person acting on behalf of the Placee is dealing with the Bookrunner, any money held in an account with the Bookrunner on behalf of the Placee and/or any person acting on behalf of the Placee will not be treated as client money within the meaning of the relevant rules and regulations of the FCA made under the FSMA.  Each Placee acknowledges that the money will not be subject to the protections conferred by the client money rules: as a consequence this money will not be segregated from the Bookrunner's money in accordance with the client money rules and will be held by it under a banking relationship and not as trustee.

The Company reserves the right to treat as invalid any application or purported application for Placing Shares that appears to the Company or its agents to have been executed, effected or dispatched from the United States, Australia, New Zealand, Canada, the Republic of Ireland, the Republic of South Africa, Japan or any member state of the EEA or in a manner that may involve a breach of the laws or regulations of any jurisdiction or if the Company or its agents believe that the same may violate applicable legal or regulatory requirements or if it provides an address for delivery of the share certificates of Placing Shares in the United States, Australia, New Zealand, Canada, the Republic of Ireland, the Republic of South Africa, Japan, any member state of the EEA or any other jurisdiction outside the United Kingdom in which it would be unlawful to deliver such share certificates.

The rights and remedies of the Company and the Bookrunner 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.

The Placee agrees to be bound by the articles of association of the Company (as amended from time to time) once the Placing Shares, which the Placee has agreed to acquire pursuant to the Placing, have been acquired by the Placee

In these Terms and Conditions any words following the terms "including", "include", "in particular", "for example" or any similar expression shall be construed as illustrative and shall not limit the sense of the words, description, definition, phrase or term preceding those terms.

References to time in the Terms and Conditions are to London time, unless otherwise stated. All times and dates in these Terms and Conditions may be subject to amendment.  Placees will be notified of any changes.

No statement in this Announcement, these Terms and Conditions or the Circular is intended to be a profit forecast or estimate, and no statement in this Announcement, these Terms and Conditions or the Circular should be interpreted to mean that earnings per share of the Company for the current or future financial years would necessarily match or exceed the historical published earnings per share of the Company.

The price of shares and any income expected from them may go down as well as up and investors may not get back the full amount invested upon disposal of the shares.  Past performance is no guide to future performance, and persons needing advice should consult an independent financial adviser.

The Placing Shares to be issued pursuant to the Placing will not be admitted to trading on any stock exchange other than AIM.

Neither the content of the Company's website nor any website accessible by hyperlinks on the Company's website is incorporated in, or forms part of, these Terms and Conditions and/or this Announcement.

APPENDIX 2

DEFINITIONS

The following definitions apply throughout this announcement, unless the context requires otherwise:

All references in this announcement to "£", "pence", "p" or "pounds sterling" are to the lawful currency of the UK, all references to "US$" or "$" are to the lawful currency of the United States