TIDMAFC
RNS Number : 8620W
AFC Energy Plc
14 February 2017
The information contained within this announcement is deemed by
the Company to constitute inside information as stipulated under
the Market Abuse Regulations (EU) No. 596/2014. Upon the
publication of this announcement via a Regulatory Information
Service ("RIS"), this inside information is now considered to be in
the public domain.
THIS ANNOUNCEMENT AND THE INFORMATION CONTAINED HEREIN IS
RESTRICTED AND IS NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION,
DIRECTLY OR INDIRECTLY, IN WHOLE OR IN PART, IN OR INTO THE UNITED
STATES, AUSTRALIA, CANADA, THE REPUBLIC OF IRELAND, THE REPUBLIC OF
SOUTH AFRICA, JAPAN, NEW ZEALAND OR ANY JURISDICTION WHERE TO DO SO
MIGHT CONSTITUTE A VIOLATION OF LOCAL SECURITIES LAWS OR
REGULATIONS.
THIS ANNOUNCEMENT IS FOR INFORMATION PURPOSES ONLY AND DOES NOT
CONSTITUTE OR FORM PART OF ANY OFFER OR INVITATION TO SELL OR
ISSUE, OR ANY SOLICITATION OF ANY OFFER TO PURCHASE OR SUBSCRIBE
FOR, ANY NEW ORDINARY SHARES, NOR SHALL IT (OR ANY PART OF IT), OR
THE FACT OF ITS DISTRIBUTION, FORM THE BASIS OF, OR BE RELIED ON IN
CONNECTION WITH, OR ACT AS ANY INDUCEMENT TO ENTER INTO, ANY
CONTRACT OR COMMITMENT WHATSOEVER WITH RESPECT TO THE PROPOSED
PLACING.
AFC Energy PLC
("AFC Energy" or the "Company")
Proposed Placing of up to 58,500,000 New Ordinary Shares,
Proposed Subscription of up to 1,500,000 New Ordinary Shares
and
Open Offer of up to 20,684,262 New Ordinary Shares at a price of
10 pence per New Ordinary Share to raise up to GBP8.1 million
AFC Energy, the industrial fuel cell power company, is pleased
to announce its intention to conduct a fundraising of up to
approximately GBP8.1 million (before expenses) through a proposed
placing of 58,500,000 ordinary shares of 0.1 pence each ("Placing
Shares") (the "Placing"), a proposed subscription of 1,500,000 New
Ordinary Shares (the "Subscription") and a proposed open offer of
up to 20,684,262 New Ordinary Shares (the "Open Offer"). The New
Ordinary Shares will rank pari passu in all other respects with the
Company's existing ordinary shares of 0.1 pence each (the "Existing
Ordinary Shares").
The Placing of New Ordinary Shares is being offered by way of an
accelerated bookbuild ("Bookbuild"), which will be launched
immediately following this announcement. Cantor Fitzgerald Europe
("Cantor Fitzgerald") will be acting as bookrunner. The Company
will also make up to 1,500,000 New Ordinary Shares available for
subscription directly from certain key shareholders (the
"Subscription").
In order to provide Shareholders who have not taken part in the
Placing or Subscription with the chance to participate in the
Fundraising, the Company is providing all Qualifying Shareholders
with the opportunity to subscribe at the Issue Price for an
aggregate of 20,684,262 New Ordinary Shares, to raise up to
approximately GBP2 million, on the basis of 1 New Ordinary Share
for every 15 Existing Ordinary Shares on 13 February 2017 (being
the last practicable date before publication of this
announcement).
The net proceeds of the Placing, Subscription and Open Offer
(together the "Fundraising") (being approximately GBP8.1 million,
assuming that all New Ordinary Shares are subscribed for) will be
used to support the Company on its journey to commercialisation,
and specifically for:
-- delivery of its commitments under the Company's joint
development agreement with De Nora S.p.A. ("De Nora");
-- business case development with De Nora;
-- scoping study completion with Peel Environmental Limited and
other third parties in advance of any potential project
deployment;
-- funding the ongoing operation of the Company's demonstration
plant at Stade, together with ongoing testing costs; and
-- general administrative expenses and ongoing working capital.
The Issue Price represents a discount of approximately 40 per
cent. to the mid-market closing price of 16.75 pence on 13 February
2017. The Fundraising is not being underwritten and is conditional
on, inter alia, on the passing of the Resolutions by Shareholders
at the General Meeting of the Company to be held at Chelsea
Football Club, Stamford Bridge, London SW6 4HS at 11.00 a.m. on 3
March 2017.
The Company has obtained irrevocable undertakings from certain
shareholders, including the Directors, to vote in favour of the
Resolutions in respect of, in aggregate, 60,905,313 Ordinary
Shares, representing 19.6 per cent. of the Existing Ordinary Shares
in issue.
The New Ordinary Shares will represent approximately 20.6 per
cent. of the issued share capital of the Company as enlarged by the
Fundraising (the "Enlarged Share Capital").
Further information on the Fundraising is contained within the
Circular which is expected to be posted to Shareholders
tomorrow.
Related Party Transaction
Yady Worldwide S.A. ("Yady") is a company that is wholly owned
by Ben White, son of Howard White, and his relations and their
investment vehicles, the Age of Reason Foundation and Eturab who
currently hold over 10 per cent. of the Existing Share Capital.
Yady and Howard White have together agreed with the Company to
subscribe for 1,500,000 Subscription Shares in the Subscription. As
Yady and Howard White (the "Related Parties") together are treated
as a "substantial shareholder" of the Company, its participation in
the Subscription constitutes a "related party transaction" under
the AIM Rules.
Tim Yeo, Adam Bond, James Gibson, Mitchell Field, Eugene
Tenenbaum and Eugene Shvidler (together the "Independent
Directors") consider, having consulted with the Company's nominated
adviser, Cantor Fitzgerald Europe, that the terms of the Related
Parties participation in the Subscription are fair and reasonable
insofar as the Company's Shareholders are concerned.
Expected Timetable
Record Date for entitlements 6.00 p.m. on 10
under the Open Offer February 2017
Announcement of the Placing 14 February 2017
Ex entitlement date for the 15 February 2017
Open Offer
Dispatch of the Circular, the 15 February 2017
Form of Proxy and, to Qualifying
Non-CREST Shareholders only,
the Application Form
Basic Entitlements and Excess 16 February 2017
Entitlements credited to stock
accounts of Qualifying CREST
Shareholders
Recommended latest time for 4.30 p.m. on 24
requesting withdrawal of Basic February 2017
Entitlements and Excess Entitlements
from CREST
Latest time and date for depositing 11.00 a.m. on 27
Basic Entitlements and Excess February 2017
Entitlements into CREST
Latest time and date for splitting 3.00 p.m. on 28
of Application Forms (to satisfy February 2017
bona fide market claims only)
Latest time for receipt of 11.00 a.m. on 1
Forms of Proxy March 2017
Latest time and date for receipt 11.00 a.m. on 2
of completed Application Forms March 2017
from Qualifying Non-CREST Shareholders
and payment in full under the
Open Offer or settlement of
relevant CREST instructions
(as appropriate)
General Meeting 11.00 a.m. on 3
March 2017
Announcement of the results 2 March 2017
of the Open Offer
Announcement of the results 3 March 2017
of the General Meeting
Issue of Placing Shares, Subscription 9 March 2017
Shares and Open Offer Shares
Admission and commencement 8.00 a.m. on 9
of dealings in the Enlarged March 2017
Share Capital expected to commence
on AIM
CREST accounts expected to 9 March 2017
be credited
Definitive share certificates 23 March 2017
to be dispatched by
For further information, please contact:
AFC Energy plc
Adam Bond (Chief Executive Officer)
Jim Gibson (Chief Operating Officer) +44 (0) 20 3697 1209
Cantor Fitzgerald Europe - Nominated Adviser and Joint Broker
Andrew Craig
Richard Salmond +44 (0) 20 7894 7000
M C Peat & Co LLP - Joint Broker
Charlie Peat +44 (0) 20 7104 2334
Lionsgate Communications - Public Relations
Jonathan Charles +44 (0) 20 3697 1209
About AFC Energy
AFC Energy plc has developed and successfully operated an
alkaline fuel cell system ("KORE"), which converts hydrogen into
"clean" electricity. AFC Energy's key project POWER-UP demonstrated
the world's largest operational alkaline fuel cell system at Air
Products' industrial gas plant in Stade, Germany in January 2016.
The Company is now looking to build upon an already established
pipeline of commercial opportunities and drive the findings from
the development phase of the technology into a technically
optimised and commercially relevant fuel cell system. For further
information, please visit our website: www.afcenergy.com.
Forward-looking statements
This announcement contains statements about AFC Energy plc that
are or may be deemed to be "forward-looking statements".
All statements, other than statements of historical facts,
included in this announcement may be forward-looking statements.
Without limitation, any statements preceded or followed by, or that
include, the words "targets", "plans", "believes", "expects",
"aims", "intends", "will", "may", "should", "anticipates",
"estimates", "projects", "would", "could", "continue" or words or
terms of similar substance or the negative thereof, are
forward-looking statements. Forward-looking statements include,
without limitation, statements relating to the following: (i)
future capital expenditures, expenses, revenues, earnings,
synergies, economic performance, indebtedness, financial condition,
dividend policy, losses and future prospects and (ii) business and
management strategies and the expansion and growth of the
operations of AFC Energy plc.
These forward-looking statements are not guarantees of future
performance. These forward-looking statements involve known and
unknown risks, uncertainties and other factors which may cause the
actual results, performance or achievements of any such person, or
industry results, to be materially different from any results,
performance or achievements expressed or implied by such
forward-looking statements. These forward-looking statements are
based on numerous assumptions regarding the present and future
business strategies of such persons and the environment in which
each will operate in the future. Investors should not place undue
reliance on such forward-looking statements and, save as is
required by law or regulation (including to meet the requirements
of the AIM Rules, the Prospectus Rules and/or the FSMA), AFC Energy
plc does not undertake any obligation to update publicly or revise
any forward-looking statements (including to reflect any change in
expectations with regard thereto or any change in events,
conditions or circumstances on which any such statement is based).
All subsequent oral or written forward-looking statements
attributed to AFC Energy plc or any persons acting on their behalf
are expressly qualified in their entirety by the cautionary
statement above. All forward-looking statements contained in this
announcement are based on information available to the Directors of
AFC Energy plc at the date of this announcement, unless some other
time is specified in relation to them, and the posting or receipt
of this announcement shall not give rise to any implication that
there has been no change in the facts set forth herein since such
date.
PROPOSED PLACING OF 58,500,000 NEW ORDINARY SHARES, SUBSCRIPTION
OF 1,500,000 NEW ORDINARY SHARES AND OPEN OFFER OF UP TO 20,684,262
NEW ORDINARY SHARES AT 10 PENCE PER SHARE TO RAISE GBP8.1
MILLION
1 Introduction
The Company has announced today that it is proposing to raise up
to GBP8.1 million (before the deduction of fees and expenses)
through a Placing, Subscription and Open Offer comprising the issue
of up to 80,684,262 New Ordinary Shares at 10 pence per New
Ordinary Share.
Each of the Placing and Subscription are conditional, inter
alia, on the passing of the Resolutions at the General Meeting,
admission becoming effective by no later than 8.00 a.m. on 9 March
2017 (or such other time and/or date, being no later than 31 March
2017, as the Company and Cantor Fitzgerald may agree) and the
Placing Agreement between the Company and Cantor Fitzgerald
becoming unconditional and not being terminated prior to Admission
(in accordance with its terms). It is expected that the New
Ordinary Shares will be admitted to trading on AIM on or around
8.00 a.m. on 9 March 2017. The Open Offer is not conditional upon
the Placing and Subscription.
The Board believes that raising equity finance through the
Fundraising is the most appropriate method of financing the Company
at this time. This allows both existing shareholders to participate
in the Fundraising and new institutional investors to enter the
Company's share register. The Fundraising avoids the need for a
prospectus to be prepared and issued, which is a costly and time
consuming process, whilst permitting Qualifying Shareholders to
participate through the Open Offer. The Board believes that the
potential value creation for the benefit of Shareholders arising
from the Fundraising outweighs the dilutive effects of the Placing
and Subscription. Although the costs associated with the
Fundraising will be lower than if the Company had prepared and
published a prospectus, in the event that the Fundraising does not
complete, the Company will still have incurred significant
costs.
The purpose of the Circular is to set out the reasons for, and
provide further information on, the Fundraising, to explain why the
Board considers the Fundraising to be in the best interests of the
Company and its Shareholders as a whole and why the Directors
unanimously recommend that Shareholders vote in favour of the
Resolutions, as they have irrevocably undertaken to do so in
respect of their own beneficial holdings of Ordinary Shares, in
aggregate representing approximately 6.86 per cent. of AFC Energy's
issued share capital on 13 February 2017 (being the last Business
Day prior to publication of the Circular).
At the end of the Circular Shareholders will find a notice
convening the General Meeting at which the Resolutions will be
proposed by the Directors. The General Meeting has been convened
for 11.00 a.m. on 3 March 2017 and will take place at Chelsea
Football Club, Stamford Bridge, London SW6 4HS.
2 Background to and reasons for the Fundraising
AFC Energy's objective is to be a world class organisation that
deploys low cost, high performance fuel cell technology to the
global energy market. The Company, which was founded in 2006 and
listed on the London Stock Exchange in 2007, was focused primarily
on research and development and fuel cell system development. Adam
Bond, previously a Non-Executive Director from 2012 to 2014, was
appointed to the Board as Chief Executive Officer in December 2014
to lead the management team who have since announced, and then
achieved, a series of milestone targets through 2015 and 2016.
During 2016, AFC Energy made significant technical progress. In
November 2016 the Company announced the successful completion of
testing and development of its second generation ("Gen2") fuel cell
system and in so doing, delivered key technical milestones 1 and 2
of the 2016 Strategic Milestones.
The Gen2 design builds on the system commissioned in Stade,
Germany in January 2016 and incorporates design changes to extend
the operating life of the fuel cell stack, while increasing stack
availability and reducing stack cost.
AFC Energy also announced in the second half of 2016 a
significant Joint Development Agreement with De Nora, one of the
largest manufacturers of electrolysers, electrodes, coatings and
electrochemical solutions. De Nora have been actively working with
AFC Energy's technology teams in the latter half of 2016 with
evidence which points to the potential for further material
enhancement to the Company's fuel cell system in the near future.
De Nora's collaboration with AFC Energy provides third party
validation of the progress the Company has made in its technology
development and lessens the business risks inherent in the
Company's road to commercial revenues. Additionally, through
collaboration with De Nora there is opportunity for AFC Energy to
better address the Chlor-Alkali sector (a significant producer of
vented hydrogen), for which De Nora is a strong part of the supply
chain. De Nora, together with AFC Energy's engineering partner,
planting GmbH, are supporting the Company to make accelerated
progress towards commercial revenues.
AFC Energy, in the second half of 2016, successfully trialled
the integration of lower grade industry standard hydrogen in the
Company's fuel cells. AFC Energy is now investigating further
potential reductions in hydrogen grade which the Directors believe
will further enhance the commercial opportunities available to the
Company. Prior to the successful trial, AFC Energy had utilised
high laboratory grade hydrogen in the development and trialling of
its fuel cell systems. Financial modelling conducted by the Company
identified hydrogen cost as one of the key drivers of economic
performance in any fuel cell project and the Directors believe that
the ability to utilise lower grade hydrogen allows the Company to
demonstrate a key advantage relative to its competitors.
In November 2016, AFC Energy signed an agreement with Peel to
assess a substantive fuel cell development opportunity at Peel's
Protos Industrial Park located in Chester. The importance of this
site for AFC Energy's fuel cell potential lies in a number of
areas: firstly, there are a number of potential industrial hydrogen
sources, some of which are currently venting hydrogen, in the
Protos vicinity which lends itself to a scalable fuel cell
opportunity. Secondly, as owner of the Protos site, Peel, together
with its regional contacts and permitting and consenting
capability, is an ideal partner for AFC Energy to explore this
opportunity and collaborate in the assessment of the UK's largest
fuel cell development project, in the UK's "Northern
Powerhouse".
At the time of Adam Bond's appointment to the Board of Directors
in December 2014, the Company set out a three year plan and
identified 2017 as the year in which AFC Energy would have the
requisite technological capabilities and project partners to
deliver commercial revenues.
This Fundraising will help to institutionalise the Company's
shareholder base and provide the Company with the resources to
pursue a number of commercial contracts, some of which are
currently in the process of detailed discussions, and will assist
AFC Energy to fulfil its strategy to deliver commercial contracts
by 2018. The Fundraising is necessary for the Company to continue
as a going concern and will enable further investment to grow the
business.
3 Current trading
2016 was a significant year for the Company with a number of
milestones delivered which has moved the Company closer to
achieving its stated goal of having 1GW of projects installed or
under development by 2020.
In 2017, the Company's primary focus is on the deployment of its
fuel cell systems in conjunction with project partners, as part of,
or as final test units before, commercial power sales are made.
2017 will also see further focus on delivering the Company's
commitments under the Joint Development Agreement with De Nora
where ongoing advancements in the fuel cell system continue to be
made. The Directors believe that given the modular nature of the
fuel cell systems developed by AFC Energy, this is likely to be for
unit sizes from 240KWs - such as the Company has deployed and
successfully operated at Stade - up to 1MW in the first instance
before larger orders are made.
In conjunction with the development of a commercial pipeline of
projects, there will be a renewed emphasis on system and cartridge
cost reductions to ensure the Company's fuel cell technology is
able to operate in a competitive and efficient manner when compared
to competing technologies. The Board expects that the Company will
continue to make progress with its key partners, including De Nora,
plantIng and Peel.
Furthermore, the Company is currently in detailed discussions
with a number of potential commercial partners, any of which may or
may not result in commercial contracts being entered into in the
key markets identified and targeted by the Directors including
Germany, the United Kingdom, Korea, Japan, Saudi Arabia, the United
Arab Emirates and other Middle Eastern states.
4 Reasons for the Fundraising and use of proceeds
The Company is proposing to raise a total of GBP8.1 million
(before deduction of fees and expenses) from the Fundraising. The
Fundraising is considered by the Directors to be in the best
interests of Shareholders as it will enable the Company to pursue
its stated strategy more effectively. The Placing will also enable
the Company to institutionalise its shareholder register.
The intended uses of the proceeds of the Fundraising, assuming
full take up under the Open Offer, are set out below:
GBPm
Product and project / business development 4.3
Operation of demonstration plant 1.1
Working capital 2.7
Proceeds from the Fundraising (before deduction of fees and
expenses) 8.1
=====
5 Details of the Placing and Subscription
It was announced on 14 February 2017 that the Company proposes
to raise, in aggregate, GBP6 million (approximately GBP5.5 million
net of expenses) by way of a Placing and Subscription of 58,500,000
Placing Shares and 1,500,000 Subscription Shares with certain new
and existing investors representing 15.35 per cent. of the Enlarged
Share Capital, at an Issue Price of 10 pence per Ordinary
Share.
The Issue Price of 10 pence per New Ordinary Share represents a
discount of 40.3 per cent. to the closing price of 16.75 pence on
13 February 2017, being the last Business Day prior to the
publication of the Circular. The Board unanimously agrees that the
level of discount and method of issue are appropriate to secure the
investment necessary in order to pursue the stated strategy of the
business and enable AFC Energy to institutionalise its shareholder
register.
In connection with the Placing, the Company has entered into the
Placing Agreement with Cantor Fitzgerald, pursuant to which Cantor
Fitzgerald has agreed to use reasonable endeavours, as agent on
behalf of the Company, to procure placees for the Placing Shares at
the Issue Price and have agreed to conditionally place the Placing
Shares with certain new investors. The Placing and Subscription are
conditional, inter alia, on:
-- the passing of the Resolutions at the General Meeting;
-- 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 Admission; and
-- Admission becoming effective by no later than 8.00 a.m. on 9
March 2017 (or such later time and/or date, being no later than
8.00 a.m. on 31 March 2017, as the Company and Cantor Fitzgerald
may agree).
Accordingly, if any of these conditions are not satisfied or, if
applicable, waived, the Fundraising will not proceed.
Further details of the Placing Agreement are set out in Part 5
of the Circular.
Application will be made to the London Stock Exchange for the
New Ordinary Shares to be admitted to trading on AIM. The New
Ordinary Shares 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 the Ordinary Shares following Admission. It is expected that
Admission will become effective, and that dealings on AIM will
commence, at 8.00 a.m. on 9 March 2017.
6 Details of the Open Offer
Subject to the terms set out below and in Part 3 of the
Circular, Qualifying Shareholders are being given the opportunity
to subscribe for the Open Offer Shares at a price of 10 pence per
Open Offer Share, pro rata to their holdings of Existing Ordinary
Shares on the Record Date on the basis of:
1 Open Offer Share for every 15 Existing Ordinary Shares
Open Offer Entitlements will be rounded down to the nearest
whole number of Open Offer Shares.
Qualifying Shareholders are also being given the opportunity,
provided that they take up their Open Offer Entitlements in full,
to apply for Excess Shares through the Excess Application
Facility.
The Open Offer Shares will be allotted and issued on 9 March
2017 conditionally on Admission of the Open Offer Shares by 9 March
2017. The Open Offer is conditional only on Admission of the Offer
Shares by 31 March 2017. It is not conditional on the passing of
the Resolutions at the General Meeting, nor the Placing and
Subscription becoming unconditional.
The Open Offer is not underwritten.
Assuming full take-up under the Open Offer, the issue of Open
Offer Shares will raise further gross proceeds of approximately
GBP2 million for the Company.
The Open Offer Shares will, upon issue, rank pari passu with the
Placing Shares, the Subscription Shares and the Existing Ordinary
Shares.
Qualifying Shareholders with holdings of Existing Ordinary
Shares in both certificated and uncertificated form will be treated
as having separate holdings for the purpose of calculating their
Open Offer Entitlements.
It should be noted that the Open Offer is not a rights issue.
Accordingly, the Application Form is not a document of title and
cannot be traded. Any Open Offer Shares not applied for under the
Open Offer will not be sold in the market or placed for the benefit
of Qualifying Shareholders who do not take up their rights to
subscribe under the Open Offer.
Excess Application Facility
The Open Offer is structured so as to allow Qualifying
Shareholders to subscribe for Open Offer Shares at the Issue Price
pro rata to their holdings of Existing Ordinary Shares. Qualifying
Shareholders may also make applications in excess of their pro rata
initial entitlement. To the extent that pro rata entitlements to
Open Offer Shares are not subscribed for by Qualifying
Shareholders, such Open Offer Shares will be available to satisfy
such Excess Applications where Qualifying Shareholders have taken
up their full Basic Entitlement. Subject to the terms of the
Placing Agreement, applications for Excess Shares may be allocated
in such manner as the Directors and Cantor Fitzgerald may
determine, and no assurance can be given that applications by
Qualifying Shareholders will be met in full or in part or at all.
Excess Applications will be rejected if and to the extent that
acceptance would result in a Qualifying Shareholder, together with
those acting in concert with him/her for the purposes of the City
Code, holding 30 per cent. or more, or increasing an existing
holding of 30 per cent. or more, of the Enlarged Share Capital
immediately following Admission.
The Open Offer is not a rights issue. Qualifying CREST
Shareholders should note that although the Basic Entitlements and
Excess Entitlements will be admitted to CREST and be enabled for
settlement, they will not be tradable and applications in respect
of the Basic Entitlements and Excess Entitlements may only be made
by the Qualifying Shareholder originally entitled or by a person
entitled by virtue of a bona fide market claim raised by
Euroclear's Claims Processing Unit. Qualifying Non-CREST
Shareholders should note that the Application Form is not a
negotiable document and cannot be traded or otherwise transferred.
Qualifying Shareholders who do not apply to take up their Basic
Entitlements will have no rights under the Open Offer or receive
any proceeds from it. If valid acceptances are not received in
respect of all Basic Entitlements under the Open Offer, unallocated
Open Offer Shares may be allotted to Qualifying Shareholders to
meet any valid applications under the Excess Application Facility
and the proceeds retained for the benefit of the Company.
Qualifying Shareholders should be aware that in the Open Offer,
unlike in a rights issue, any Open Offer Shares not applied for
will not be sold in the market or placed for the benefit of
Qualifying Shareholders.
Application has been made for the Basic Entitlements and Excess
Entitlements of Qualifying CREST Shareholders to be admitted to
CREST. It is expected that such Basic Entitlements and Excess
Entitlements will be admitted to CREST on 16 February 2017. The
Basic Entitlements and Excess Entitlements will also be enabled for
settlement in CREST on 16 February 2017 to satisfy bona fide market
claims only. Applications through the CREST system may only be made
by the Qualifying CREST Shareholder originally entitled or by a
person entitled by virtue of a bona fide market claim.
Further details of the Open Offer and the terms and conditions
on which it is being made, including the procedure for application
and payment, are contained in Part 3 of the Circular and for
Non-CREST Qualifying Shareholders on the accompanying Application
Form. To be valid, Application Forms or CREST instructions (duly
completed) and payment in full for the Open Offer Shares applied
for must be received by the Receiving Agent by no later than 11.00
a.m. on 2 March 2017. Application Forms should be returned to
Computershare Investor Services plc, The Pavilions, Bridgwater
Road, BS99 6AH or by hand to Computershare Investor Services plc,
The Pavilions, Bridgwater Road, BS13 8AE (during normal business
hours) by no later than 11.00 a.m. on 2 March 2017.
Qualifying CREST Shareholders should note that, although their
entitlements will be admitted to CREST and be enabled for
settlement, applications in respect of entitlements under the Open
Offer may only be made by the Qualifying Shareholder originally
entitled or by a person entitled by virtue of a bona fide market
claim raised by Euroclear's Claims Processing Unit.
Qualifying Non-CREST Shareholders should note that their
Application Form is not a negotiable document and cannot be traded.
Further information on the Open Offer and the terms and conditions
on which it is made, including the procedure for application and
payment, are set out in Part 3 of the Circular and, where relevant,
on the Application Form.
It is expected that Qualifying CREST Shareholders will receive a
credit to their appropriate stock accounts in CREST in respect of
their Basic Entitlements and Excess Entitlements on 16 February
2017.
If Admission of the Open Offer Shares does not occur by 31 March
2017, the Open Offer will not become unconditional and application
monies will be returned to applicants, without interest, as soon as
practicable thereafter.
7 General Meeting
The Directors do not currently have authority to allot all of
the New Ordinary Shares and, accordingly, the Board is seeking the
approval of Shareholders to allot the New Ordinary Shares at the
General Meeting.
A notice convening the GM to be held at Chelsea Football Club,
Stamford Bridge, London SW6 4HS at 11.00 a.m. on 3 March 2017 is
set out at the end of the Circular. The Resolutions to be proposed
at that meeting are, inter alia, to:
-- Resolution 1 which is an ordinary resolution to authorise the
Directors to allot relevant securities up to an aggregate nominal
amount of GBP80,684 being equal to 80,684,262 New Ordinary Shares
(i.e. the maximum number of New Ordinary Shares available under the
Placing, Subscription and Open Offer); and
-- Resolution 2 which is conditional on the passing of
Resolution 1 and is a special resolution to authorise the Directors
to issue and allot 80,684,262 New Ordinary Shares pursuant to the
Placing, Subscription and Open Offer on a non-pre-emptive
basis.
The authorities to be granted pursuant to the Resolutions shall
expire on the date falling 6 months from the date of the passing of
the Resolutions (unless renewed varied or revoked by the Company
prior to or on that date) and shall be in addition to the
Directors' authorities to allot relevant securities and dis-apply
statutory pre-emption rights granted at the Company's Annual
General Meeting held on 28 April 2016.
The Directors do currently have sufficient authority to allot
the Open Offer Shares and therefore the Open Offer is not
conditional on the Resolutions being passed.
8 Directors' shareholdings
As part of the Open Offer, certain of the Directors' share
holdings will increase.
The beneficial and non-beneficial interests of the Directors and
persons closely associated with them in Ordinary Shares as at the
date of the Circular and following the Fundraising are set out in
the table below.
Date of the Circular New Ordinary Immediately following
Shares the Fundraising
Number of Percentage Number Number of Percentage
Ordinary of ordinary of Ordinary Ordinary of Issued
Shares share Shares Shares ordinary
capital share capital
Director
Tim Yeo 877,272 0.28% 50,000 927,272 0.24%
Adam Bond 3,000,000 0.97% Nil 3,000,000 0.77%
James Gibson 90,000 0.03% Nil 90,000 0.02%
Mitchell
Field 2,894,810 0.93% Nil 2,894,810 0.74%
Eugene Shvidler 14,432,737 4.65% Nil 14,432,737 3.69%
Eugene Tenenbaum Nil Nil Nil Nil Nil
9 Irrevocable Undertakings
The Company has obtained irrevocable undertakings, from certain
Shareholders, including the Directors to vote in favour of the
Resolutions in respect of, in aggregate, of 60,905,313 Ordinary
Shares, in aggregate representing approximately 19.6 per cent. of
AFC Energy's issued share capital on 13 February 2017 (being the
last Business Day prior to publication of this Circular).
As set out in section 8 above, certain of the Directors have
irrevocably undertaken to take up their rights under the Open Offer
to purchase Ordinary Shares.
10 Action to be taken in respect of the General Meeting
Shareholders should check that they have received with the
Circular:
-- a Form of Proxy for use in respect of the General Meeting; and
-- if based in the United Kingdom, a reply-paid envelope for use
in conjunction with the return of the Form of Proxy.
Whether or not Shareholders propose to attend the General
Meeting in person, Shareholders are strongly encouraged to
complete, sign and return their Form of Proxy in accordance with
the instructions printed thereon as soon as possible, but in any
event so as to be received, by post to Computershare Investor
Services PLC, The Pavilions, Bridgwater Road, Bristol BS99 6ZY or
by hand to Computershare Investor Services PLC, The Pavilions,
Bridgwater Road, Bristol BS99 6ZY, during normal business hours
only, by no later than 11.00 a.m. on 1 March 2017 (or, in the case
of an adjournment of the General Meeting, not later than 48 hours
before the time fixed for the holding of the adjourned meeting
(excluding any part of a day that is not a Business Day)).
Appointing a proxy in accordance with the instructions set out
above will enable Shareholder votes to be counted at the General
Meeting in the event of Shareholder's absence. The completion and
return of the Form of Proxy will not prevent Shareholders from
attending and voting at the General Meeting, or any adjournment
thereof, in person should Shareholders wish to do so.
11 Recommendation
The Directors believe that the Resolutions to be proposed at the
General Meeting are in the best interests of the Company and
Shareholders as a whole and unanimously recommend that Shareholders
vote in favour of the Resolutions. Each of the Directors who hold
Ordinary Shares has irrevocably undertaken to vote in favour of the
Resolutions in respect of, in aggregate, 21,294,819 Ordinary
Shares, representing approximately 6.86 per cent. of the Ordinary
Shares in issue on 13 February 2017 (being the last Business Day
prior to publication of this Circular).
DEFINITIONS
In this announcement, the following defined terms have the
following meaning:
"Admission" admission of the New Ordinary Shares to trading on AIM
becoming effective in accordance with
the AIM Rules;
"AIM" the market of that name operated by the London Stock
Exchange;
"AIM Rules" together, the AIM Rules for Companies and the AIM Rules for
Nominated Advisers;
"Application Form" the non-CREST Application Form;
"Basic Entitlement(s)" the pro rata entitlement of Qualifying Shareholders to
subscribe for 1 Open Offer Share for
every 15 Existing Ordinary Shares registered in their name as
at the Record Date, on and subject
to the terms of the Open Offer;
"Board" or "Directors" the directors of AFC Energy whose names are set out on page 5
of the Circular;
"Business Day" any day on which banks are usually open in England and Wales
for the transaction of business,
other than a Saturday, Sunday or public holiday;
"Cantor Fitzgerald" or "CFE" Cantor Fitzgerald Europe, One Churchill Place, Canary Wharf,
London E14 5RB, as Nominated
Adviser and Broker to the Company;
"Circular" the Circular, posted to Shareholders on 15 February 2017;
"City Code" the City Code on Takeovers and Mergers;
"Company" or "AFC Energy" AFC Energy Plc, a company incorporated and registered in
England and Wales with company number
05668788;
"CREST" the computerised settlement system (as defined in the CREST
Regulations) operated by Euroclear
UK & Ireland Limited;
"CREST Manual" the compendium of documents entitled CREST Manual issued by
Euroclear from time to time and
comprising the CREST Reference Manual, the CREST Central
Counterparty Service Manual, the
CREST International Manual and the CREST Glossary of Terms;
"CREST Member" a person who has been admitted to Euroclear as a member (as
defined in the CREST Order);
"CREST Participant" a person who is, in relation to CREST, a system-participant
(as
defined in the CREST Regulations);
"CREST Regulations" the Uncertificated Securities Regulations 2001 (SI 2001/3755)
(as amended from time to time);
"CREST Sponsor" a CREST participant admitted to CREST as a CREST Sponsor;
"CREST Sponsored Member" a CREST Member admitted to CREST as a sponsored member;
"De Nora" Industrie De Nora S.p.A, with which the Company entered a
joint development agreement as disclosed
in an announcement on 5 August 2016;
"Enlarged Share Capital" the Company's issued ordinary share capital immediately
following Admission;
"Euroclear" Euroclear UK & Ireland Limited;
"Excess Application" Open Offer Shares which may be applied for by Qualifying
Shareholders under the Excess Application
Facility;
"Excess Application Facility" the arrangement pursuant to which Qualifying Shareholders may
apply for additional Open Offer
Shares in excess of their Open Offer Entitlement in accordance
with the terms and conditions
of the Open Offer;
"Excess CREST Open Offer Entitlement" in respect of each Qualifying CREST Shareholder, their
entitlement (in addition to his Open
Offer Entitlement) to apply for Open Offer Shares pursuant to
the Excess Application Facility,
which is conditional on him taking up his Open Offer
Entitlement in full;
"Excess Shares" Open Offer Shares applied for by Qualifying Shareholders under
the Excess Application Facility;
"Ex-entitlement Date" the date on which the Existing Ordinary Shares are marked "ex"
for entitlement under the Open
Offer, being 15 February 2017;
"Existing Ordinary Shares" the ordinary shares of 0.1 pence each in the capital of the
Company as at the date of this
announcement, being 310,263,943 Ordinary Shares;
"FCA" the Financial Conduct Authority;
"Form of Proxy" the form of proxy attached to the Circular for use by
Shareholders in connection with the
GM;
"FSMA" Financial Services and Markets Act 2000, as amended;
"Fundraising" together, the Placing, Subscription and Open Offer;
"Gen2" the second generation of the Company's fuel cell system which
was completed in November 2016;
"GM" or "General Meeting" the general meeting of AFC Energy to be held at Chelsea
Football Club, Stamford Bridge, London
SW6 4HS at 11.00 a.m. on 3 March 2017, notice of which is set
out in Part 6 of the Circular;
"HMRC" Her Majesty's Revenue & Customs;
"Issue Price" 10 pence per New Ordinary Share;
"Listing Rules" the listing rules of the FCA made in accordance with section
73A(2) of FSMA;
"London Stock Exchange" London Stock Exchange plc;
"Money Laundering Regulations" the Money Laundering Regulations (2007) (as amended) and
obligations in connection with money
laundering under the Criminal Justice Act 1993 and the
Proceeds of Crime Act 2002;
"New Ordinary Shares" the 80,684,262 new Ordinary Shares in the capital of AFC
Energy to be issued in connection
with the Fundraising;
"Notice of GM" the notice of General Meeting which forms part of the
Circular;
"Open Offer" the invitation to Qualifying Shareholders to subscribe for
the Open Offer Shares at the Issue
Price on the terms and subject to the conditions set out in
the Circular and in the case of
Qualifying Non-CREST Shareholders only, the Application Form;
"Open Offer Entitlement" the entitlement of Qualifying Shareholders to subscribe for
Open Offer Shares allocated to
Qualifying Shareholders on the Record Date pursuant to the
Open Offer;
"Open Offer Shares" the 20,684,262 New Ordinary Shares being made available to
Qualifying Shareholders pursuant
to the Open Offer;
"Ordinary Shares" the ordinary shares of 0.1 pence each in the capital of the
Company;
"Overseas Shareholder" a Shareholder with a registered address outside of the United
Kingdom;
"Participant ID" the identification code or membership number used in CREST to
identify a particular CREST
Member or other CREST Participant;
"Peat" M C Peat & Co LLP, the Company's Joint Broker;
"Peel" Peel Environmental Limited;
"Placees" the placees subscribing for Placing Shares pursuant to the
Placing;
"Placing Agreement" the conditional placing agreement dated 14 February 2017
between Cantor Fitzgerald and the
Company, details of which are set out in the letter from the
Chairman;
"Placing" the proposed placing by Cantor Fitzgerald, as agent for the
Company, of the Placing Shares;
"Placing Shares" the 58,500,000 New Ordinary Shares to be allotted on the
terms of the Placing Agreement;
"Prospectus Rules" the prospectus rules of the Financial Conduct Authority made
under Part VI of the Financial
Services and Markets Act 2000;
"Prospectus Directive" directive 2003/71/EC on the prospectus to be published when
securities are offered to the
public or admitted to trading;
"Qualifying CREST Shareholders" Qualifying Shareholders holding Ordinary Shares in
uncertificated form in CREST at the Record
Date;
"Qualifying Non-CREST Shareholders" Qualifying Shareholders holding Ordinary Shares in
certificated form at the Record Date;
"Qualifying Shareholders" holders of Ordinary Shares on the register of members of the
Company at the Record Date with
the exclusion of Shareholders with a registered address or
who are resident in any Restricted
Jurisdiction;
"Record Date" close of business on 10 February 2017;
"Registrars" or "Receiving Agent" Computershare Investor Services PLC, The Pavilions,
Bridgwater Road, Bristol, BS99 7NH;
"Regulatory Information Service" has the meaning given under the AIM Rules;
"Resolutions" the resolutions to be proposed at the GM, as set out in the
Notice of GM;
"Restricted Jurisdiction" each and any of Australia, Canada, Japan, the Republic of
Ireland, the Republic of South Africa,
New Zealand and the United States and any other jurisdiction
where the extension or the availability
of the Open Offer would breach any applicable law;
"Securities Act" US Securities Act of 1933 (as amended);
"Shareholders" holders of Existing Ordinary Shares in AFC Energy;
"Subscription" the proposed subscription for New Ordinary Shares by certain
existing investors;
"Subscription Shares" the 1,500,000 Ordinary Shares to be subscribed for pursuant
to the Subscription;
"UK" or "the United Kingdom" the United Kingdom of Great Britain and Northern Ireland;
"Uncertificated" or "Uncertificated form" recorded on the relevant register or other record of the
Shares or other security concerned
as being held in uncertificated form in CREST, and title to
which, by virtue of the CREST
Regulations, may be transferred by means of CREST;
"United States", "United States of America" or "US" the United States of America, its territories and
possessions, any state of the United States
of America and the District of Columbia and all areas subject
to its jurisdiction;
"2016 Strategic Milestones" the strategic milestones of the Company as detailed in an
announcement released by RIS on
1 March 2016;
"GBP", "Pounds Sterling" or "Pence" UK pounds sterling, the lawful currency of the United
Kingdom; and
"EUR" or "Euro" single legal currency of Eurozone countries.
APPIX - TERMS AND CONDITIONS OF THE PLACING
FOR INVITED PLACEES ONLY - IMPORTANT INFORMATION
The information contained herein is restricted and is not for
publication, release or distribution in or into the United States,
Canada, Australia, Japan, Singapore, the Republic of South Africa,
the Republic of Ireland or New Zealand or any other jurisdiction
where to do so would constitute a violation of the relevant laws of
such jurisdiction.
Each Placee should consult with its own advisers as to legal,
tax, business and related aspects of any subscription for New
Ordinary Shares.
These Terms and Conditions (the "Terms and Conditions") do not
constitute an offer or invitation to acquire, underwrite or dispose
of, or any solicitation of any offer or invitation to acquire,
underwrite or dispose of, any Ordinary Shares or other securities
of the Company to any person in any jurisdiction to whom it is
unlawful to make such offer, invitation or solicitation in such
jurisdiction. Persons who seek to participate in the Placing must
inform themselves about and observe any such restrictions and must
be persons who are able to lawfully receive this Announcement in
their jurisdiction (all such persons being "Relevant Persons"). In
particular, these Terms and Conditions do not constitute an offer
or invitation (or a solicitation of any offer or invitation) to
acquire, underwrite or dispose of or otherwise deal in any Ordinary
Shares or other securities of the Company in the United States,
Canada, Australia, Japan, Singapore or the Republic of South
Africa, subject to certain limited exemptions.
Members of the public are not eligible to take part in the
Placing and each Placee agrees, undertakes and warrants that it is
not acquiring New Ordinary Shares on behalf of members of the
public or its Retail clients (as that term is defined in the Rules
of the FCA), save where the Placee does so on a fully discretionary
basis and without reference to any such Retail clients. In the UK,
the Placing and these Terms and Conditions are directed only at
persons whose ordinary activities involve them acquiring, holding,
managing or disposing of investments (as principal or agent) for
the purposes of their businesses and who have professional
experience in matters relating to investments falling within the
definition of 'investment professionals' in Article 19 of the
Financial Services and Markets Act 2000 (Financial Promotion) Order
2005, as amended (the "Order") or are high net worth body
corporates, unincorporated associations or partnerships or trustees
of high value trusts as described in Article 49 of the Order or to
whom they may otherwise lawfully be communicated.
The New Ordinary Shares have not been, and will not be,
registered under the United States Securities Act of 1933, as
amended (the "Securities Act") or under any other securities
legislation of any state of the United States or registered or
qualified under the applicable securities laws of any province of
Canada or Australia, Japan, Singapore or the Republic of South
Africa. Accordingly, the New Ordinary Shares may not, subject to
certain limited exceptions, be offered or sold, directly or
indirectly, within the United States, any province of Canada or
Australia, Japan, Singapore or the Republic of South Africa or
offered or sold to, or for the account or benefit of, US persons
(as defined in Regulation S of the Securities Act ("Regulation S")
("US Person")) or a national, citizen or resident of any province
of Canada or Australia, Japan, Singapore or the Republic of South
Africa. The New Ordinary Shares are being offered and sold outside
the United States in offshore transactions complying with
Regulation S, which provides an exemption from the requirement to
register the offer and sale under the Securities Act.
These Terms and Conditions apply to any person who offers to
subscribe for New Ordinary Shares in the Placing. Each person (a
"Placee") to whom these Terms and Conditions apply, as described
above, who confirms his agreement, whether by telephone or
otherwise, with Cantor Fitzgerald Europe to subscribe for New
Ordinary Shares in the Placing, hereby agrees with Cantor
Fitzgerald Europe to be legally and irrevocably bound by these
Terms and Conditions which will be the Terms and Conditions on
which the New Ordinary Shares will be acquired in the Placing.
Capitalised terms not otherwise defined in this Appendix are as
defined in the Announcement relating to the Placing of which this
Appendix forms part.
These Terms and Conditions must not be acted on or relied on by
persons who are not Relevant Persons. Any investment or investment
activity to which these Terms and Conditions relate is available
only to Relevant Persons and will be engaged in only with Relevant
Persons. A Placee may not assign, transfer, or in any manner, deal
with its rights and obligations under the agreement arising from
the acceptance of the Placing, without the prior written agreement
of Cantor Fitzgerald Europe, in accordance with all relevant
requirements.
All times and dates in this Appendix are references to times and
dates in London (United Kingdom).
Terms of the Placing
Each Placee's commitment to subscribe for a fixed number of New
Ordinary Shares under the Placing will be agreed orally with Cantor
Fitzgerald Europe and such agreement will constitute a binding
irrevocable commitment by a Placee, subject to the Terms and
Conditions set out in this Appendix, to subscribe and pay for the
relevant number of New Ordinary Shares (the "Placing
Participation") at the Placing Price. Such commitment is not
capable of termination or rescission by the Placee in any
circumstances except fraud. All such obligations are entered into
by the Placee with Cantor Fitzgerald Europe acting in its capacity
as agent of the Company and are therefore directly enforceable by
the Company.
After such agreement is entered into, each Placee allocated New
Ordinary Shares in the Placing will be sent a confirmatory email
stating the number of New Ordinary Shares allocated to it at the
Placing Price, the total subscription amount payable to Cantor
Fitzgerald Europe and including settlement instructions (the
"Confirmation Note").
Each Placee will be deemed to have read this Appendix in its
entirety. Cantor Fitzgerald Europe is acting for the Company and no
one else in connection with the Placing and will not regard any
other person (whether or not a recipient of these Terms and
Conditions) as a client in relation to the Placing and to the
fullest extent permitted by law and applicable FCA rules, neither
Cantor Fitzgerald Europe nor any of its affiliates will have any
liability, obligation or duty to Placees or to any person other
than the Company in respect of the Placing.
The New Ordinary Shares will rank pari passu in all respects and
form one class with the Existing Ordinary Shares of the Company in
issue on Admission, including the right to receive dividends or
other distributions, if any. The New Ordinary Shares will be issued
free of any encumbrance, lien or other security interest.
Application for Admission
Application will be made to London Stock Exchange plc for
Admission of the New Ordinary Shares to trading on AIM. It is
anticipated that Admission of the New Ordinary Shares to AIM will
become effective at 8.00 a.m. on 9 March 2017 and that dealings in
the New Ordinary Shares will commence at that time and date for
normal account settlement.
Placing Participations conditional
Placing Participations are in all respects conditional
upon:-
(i) the Placing Agreement entered into between Cantor Fitzgerald
Europe and the Company relating to the placing of the New Ordinary
Shares becoming unconditional in all respects and not having been
terminated in accordance with its terms; and
(ii) Admission having become effective,
in each case by 8.00 a.m. on 9 March 2017 (or such later time
and/or date as the Company and Cantor Fitzgerald Europe agree, but
in any event being no later than 8.00 a.m. on 31 March 2017 (the
"Long Stop Date")).
Scaling back
Cantor Fitzgerald Europe (after consulting with the Company)
reserves the right to scale back the number of New Ordinary Shares
to be subscribed for by any Placee or the number of New Ordinary
Shares to be subscribed for by all Placees in aggregate. The
Company and Cantor Fitzgerald Europe also reserve the right not to
offer allocations of New Ordinary Shares to any person and not to
accept offers to subscribe for New Ordinary Shares or to accept
such offers in part rather than in whole. Cantor Fitzgerald Europe
shall be entitled to effect the Placing by such method as it shall
in its sole discretion determine.
To the fullest extent permissible by law, neither Cantor
Fitzgerald Europe or any holding company thereof, nor any
subsidiary, branch or affiliate of Cantor Fitzgerald Europe (each
an "Affiliate") nor any person acting on behalf of any of the
foregoing shall have any liability to Placees (or to any other
person whether acting on behalf of a Placee or otherwise). In
particular, none of Cantor Fitzgerald Europe nor any of its
Affiliates nor any person acting on behalf of any such person shall
have any liability to Placees in respect of its conduct of the
Placing.
Placing Agreement
Pursuant to the Placing Agreement, Cantor Fitzgerald Europe has
agreed on behalf of and as agent of the Company, to use its
reasonable endeavours to procure persons who will subscribe for the
New Ordinary Shares at the Placing Price, subject to these Terms
and Conditions. The Placing is not underwritten.
Conditions of the Placing
Cantor Fitzgerald Europe's obligations under the Placing
Agreement in respect of the New Ordinary Shares are conditional on,
inter alia:-
(a) none of the warranties or undertakings contained in the
Placing Agreement being untrue, inaccurate or misleading in any
material respect at any time before Admission and no fact or
circumstance having occurred or arisen which would constitute a
material breach of any of the warranties or undertakings on the
part of the Company contained in the Placing Agreement;
(b) the New Ordinary Shares having been allotted, subject only
to Admission, in accordance with the Placing Agreement; and
(c) Admission taking place not later than 8.00 a.m. on 9 March
2017 or such later date as the Company and Cantor Fitzgerald Europe
may otherwise agree (but not being later than 8.00 a.m. on the Long
Stop Date).
The Placing Agreement contains, inter alia, certain warranties
and indemnities from the Company for the benefit of Cantor
Fitzgerald Europe.
Right to terminate under the Placing Agreement
Cantor Fitzgerald Europe may, in its absolute discretion,
terminate the Placing Agreement (i) if any of the warranties given
by the Company to Cantor Fitzgerald Europe in the Placing Agreement
(a) was untrue or inaccurate or was misleading at the date of the
Placing Agreement (b) would not be true and accurate, or would be
misleading, if they were to be repeated at any time prior to
Admission (by reference to the facts and circumstances in each case
then existing), in the case of each of (a) and (b) in a respect
which Cantor Fitzgerald Europe considers to be material in the
context of the Placing; (ii) in the event of the failure of the
Company to comply with its obligations under the Placing Agreement;
(iii) in the event of the occurrence (in the sole judgement of
Cantor Fitzgerald Europe) of a material adverse change in the
financial or trading position or prospects of the Company; or (iv)
in the event of the occurrence of a 'force majeure' event which, in
the opinion of Cantor Fitzgerald Europe, is likely to have a
materially prejudicial effect on the Placing or make it
impracticable or inadvisable to proceed with the Placing. The
exercise by Cantor Fitzgerald Europe of any right of termination
(or any right of waiver exercisable by Cantor Fitzgerald Europe)
contained in the Placing Agreement or the exercise of any
discretion under the Terms and Conditions set out herein is within
the absolute discretion of Cantor Fitzgerald Europe and Cantor
Fitzgerald Europe will not have any liability to Placees whatsoever
in connection with any decision to exercise or not exercise any
such rights.
By accepting the New Ordinary Shares referred to in the
Announcement to which this Appendix is annexed, each Placee agrees
that, without having any liability to such Placee, Cantor
Fitzgerald Europe may, in its absolute discretion, exercise the
right, (i) to extend the time for fulfilment of any of the
conditions in the Placing Agreement (provided that Placees'
commitments are not extended beyond the Long Stop Date); (ii) to
waive, in whole or in part, fulfilment of certain of the
conditions; or (iii) to terminate the Placing Agreement, in each
case without consulting Placees (or any of them).
If (i) any of the conditions in the Placing Agreement are not
satisfied (or, where relevant, waived); or (ii) the Placing
Agreement is terminated; or (iii) the Placing Agreement does not
otherwise become unconditional in all respects, the Placing will
not proceed and all funds delivered by Placees to Cantor Fitzgerald
Europe or the Company pursuant to the Placing and this Appendix
will be returned to Placees at their risk without interest, and
Placees' rights and obligations under the Placing shall cease and
determine at such time and no claim shall be made by Placees in
respect thereof.
Registration and Settlement
Settlement of transactions in the New Ordinary Shares (ISIN:
GB00B18S7B29) following Admission will take place within CREST
(subject to certain exceptions). Cantor Fitzgerald Europe reserves
the right to require settlement for, and delivery of, the New
Ordinary Shares (or a portion thereof) to Placees by such other
means that it deems necessary if delivery or settlement is not
possible or practicable within CREST within the timetable set out
in this Announcement or would not be consistent with the regulatory
requirements in any Placee's jurisdiction.
It is expected that settlement will be on 9 March 2017 in
accordance with the instructions set out in the Confirmation
Note.
Interest is chargeable daily on payments not received from
Placees on the due date in accordance with the arrangements set out
above at the rate of 3 percentage points above The Royal Bank of
Scotland plc's base rate, with interest compounded on a daily
basis.
Each Placee is deemed to agree that, if it does not comply with
these obligations, Cantor Fitzgerald Europe may sell any or all of
the New Ordinary Shares allocated to that Placee on such Placee's
behalf and retain from the proceeds, for Cantor Fitzgerald Europe's
account and benefit (as agent for the Company), an amount equal to
the aggregate amount owed by the Placee plus any interest due. The
relevant Placee will, however, remain liable for any shortfall
below the aggregate amount owed by it and may be required to bear
any stamp duty or stamp duty reserve tax or securities transfer tax
(together with any interest or penalties) which may arise upon the
sale of such New Ordinary Shares on such Placee's behalf. By
communicating a bid for New Ordinary Shares, each Placee confers on
Cantor Fitzgerald Europe all such authorities and powers necessary
to carry out any such sale and agrees to ratify and confirm all
actions which Cantor Fitzgerald Europe lawfully takes in pursuance
of such sale.
If New Ordinary Shares are to be delivered to a custodian or
settlement agent, Placees should ensure that the Confirmation Note
is copied and delivered immediately to the relevant person within
that organisation.
Insofar as New Ordinary 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 New Ordinary Shares should, subject as provided below,
be so registered free from any liability to UK stamp duty or stamp
duty reserve tax or securities transfer tax.
Placees will not be entitled to receive any fee or commission in
connection with the Placing.
Further Terms, Confirmations and Warranties
By accepting the Placing Participation referred to in the
Confirmation Note, each Placee makes the following confirmations,
acknowledgements, representations, warranties and/or undertakings
to Cantor Fitzgerald Europe and the Company and their respective
directors, agents and advisers:
1 each Placee confirms, represents and warrants that it has read
and understood this Announcement (including this Appendix) in its
entirety and acknowledges that its Placing Participation will be
governed by the terms, conditions, representations, warranties,
acknowledgements, agreements and undertakings of this Appendix;
2 each Placee acknowledges and agrees that its Placing
Participation on the Terms and Conditions set out in this Appendix
is legally binding, irrevocable and is not capable of termination
or rescission by such Placee in any circumstances;
3 each Placee confirms, represents and warrants that it has not
relied on, received or requested nor does it have any need to
receive, any prospectus, offering memorandum, listing particulars
or any other document (other than the Announcement), any
information given or any representations, warranties, agreements or
undertakings (express or implied), written or oral, or statements
made at any time by the Company, Cantor Fitzgerald Europe or by any
subsidiary, holding company, branch or associate of the Company or
Cantor Fitzgerald Europe, or any of their respective officers,
directors, agents, employees or advisers, or any other person in
connection with the Placing, the Company and its subsidiaries or
the New Ordinary Shares and that in making its application under
the Placing it is relying solely on the information contained in
the Announcement and this Appendix and it will not be relying on
any agreements by the Company and its subsidiaries or Cantor
Fitzgerald Europe or any director, employee or agent of the Company
or Cantor Fitzgerald Europe other than as expressly set out in this
Appendix for which none of Cantor Fitzgerald Europe or any of their
directors and/or employees and/or person(s) acting on behalf of any
of them shall to the maximum extent permitted under law have any
liability except in the case of fraud;
4 each Placee confirms, represents and warrants that it is
sufficiently knowledgeable to understand and be aware of the risks
associated with, and other characteristics of, the New Ordinary
Shares and, among others, of the fact that it may not be able to
resell the New Ordinary Shares except in accordance with certain
limited exemptions under applicable securities legislation and
regulatory instruments;
5 each Placee confirms, represents and warrants, if a company,
that it is a valid and subsisting company and has all the necessary
corporate capacity and authority to execute its obligations in
connection with the Placing Participation and confirms, represents
and warrants that any person who confirms to Cantor Fitzgerald
Europe on behalf of a Placee an agreement to subscribe for New
Ordinary Shares is duly authorised to provide such confirmation to
Cantor Fitzgerald Europe;
6 each Placee agrees that the exercise by Cantor Fitzgerald
Europe of any right of termination or any right of waiver
exercisable by Cantor Fitzgerald Europe contained in the Placing
Agreement or the exercise of any discretion including (without
limitation) the right not to enter into the Placing Agreement is
within the absolute discretion of Cantor Fitzgerald Europe and
Cantor Fitzgerald Europe will not have any liability to any Placee
whatsoever in connection with any decision to exercise or not
exercise any such rights. Each Placee acknowledges that if (i) any
of the conditions in the Placing Agreement are not satisfied (or,
where relevant, waived); or (ii) the Placing Agreement is
terminated; or (iii) the Placing Agreement does not otherwise
become unconditional in all respects, the Placing will lapse and
such Placee's rights and obligations in relation to the Placing
shall cease and determine at such time and no claim shall be made
by any Placee in respect thereof;
7 each Placee acknowledges and agrees that Cantor Fitzgerald
Europe is not acting for, and that it does not expect Cantor
Fitzgerald Europe to have any duties or responsibilities towards,
such Placee, including, without limitation, for providing
protections afforded to customers or clients of Cantor Fitzgerald
Europe under the FCA's Conduct of Business Source Book or advising
such Placee with regard to its Placing Participation and that such
Placee is not, and will not be, a customer or client of Cantor
Fitzgerald Europe as defined by the FCA's Conduct of Business
Source Book in connection with the Placing. Likewise, Cantor
Fitzgerald Europe will not treat any payment by such Placee
pursuant to its Placing Participation as Client Money governed by
the FCA's Client Assets Sourcebook;
8 each Placee undertakes and agrees that it will be responsible
for any stamp duty or stamp duty reserve tax in relation to the New
Ordinary Shares comprised in its Placing Participation and that
neither Cantor Fitzgerald Europe nor the Company will be
responsible for any liability to stamp duty or stamp duty reserve
tax in relation to the New Ordinary Shares comprised in such
Placee's Placing Participation;
9 each Placee confirms, represents and warrants that it is a
Relevant Person and that it may lawfully subscribe for or acquire
the New Ordinary Shares comprised in such Placee's Placing
Participation and that it has complied with and will comply with
all applicable provisions of FSMA with respect to anything done by
such Placee in relation to the New Ordinary Shares in, from or
otherwise involving, the United Kingdom;
10 each Placee acknowledges and agrees that the agreement
confirmed by the Confirmation Note is a legally binding contract
between it and the Company and the Terms and Conditions of such
Placee's Placing Participation will be governed by, and construed
in accordance with, the laws of England and Wales to the exclusive
jurisdiction of whose courts such Placee irrevocably agrees to
submit;
11 each Placee agrees that it will ensure delivery and payment
is completed in accordance with the settlement instructions set out
in the Confirmation Note (or as separately agreed with Cantor
Fitzgerald Europe in the case of certificated settlement) and
acknowledges and agrees that time shall be of the essence as
regards such Placee's obligations pursuant to its Placing
Participation;
12 each Placee acknowledges and agrees that it is the
responsibility of such Placee (if it is outside of the United
Kingdom) to satisfy itself that, in doing so, such Placee complies
with the laws of any relevant territory in connection with its
Placing Participation and that it obtains any requisite
governmental or other consents and observes any other applicable
formalities;
13 each Placee acknowledges and agrees that the Announcement
does not constitute an offer to sell, or the solicitation of an
offer to subscribe for or buy, New Ordinary Shares in any
jurisdiction in which such an offer or solicitation is unlawful.
Accordingly, such Placee acknowledges and agrees that the New
Ordinary Shares may not, subject to certain limited exceptions, be
offered or sold, directly or indirectly, in or into the United
States, any province of Canada or Australia, Japan, Singapore or
the Republic of South Africa or offered or sold to, or for the
account or benefit of, a national, citizen or resident of the
United States, any province of Canada or Australia, Japan,
Singapore or the Republic of South Africa, in each case subject to
limited exemptions, or any other jurisdiction where to do so would
constitute a violation of the relevant laws of such
jurisdiction;
14 each Placee acknowledges and agrees that the New Ordinary
Shares have not been and will not be registered under the
Securities Act or with any securities regulatory authority of any
state or jurisdiction of the United States, or the relevant
Canadian, Japanese, Australian, Singaporean or South African
securities legislation and therefore the New Ordinary Shares may
not be offered, sold, transferred or delivered directly or
indirectly into the United States, Canada, Japan, Australia,
Singapore or the Republic of South Africa or their respective
territories and possessions, subject to limited exemptions, and in
the case of the United States, pursuant to an exemption from, or in
a transaction not subject to the registration requirements of, the
Securities Act and in compliance with United States securities
laws;
15 each Placee confirms, represents and warrants that it has
complied with all relevant laws of all relevant territories,
obtained all requisite governmental or other consents which may be
required in connection with its Placing Participation, complied
with all requisite formalities and that it has not taken any action
or omitted to take any action which will or may result in Cantor
Fitzgerald Europe, the Company or any of their respective
directors, officers, agents, employees or advisers acting in breach
of the legal or regulatory requirements of any territory in
connection with the Placing or such Placee's Placing
Participation;
16 each Placee confirms, represents and warrants that its
subscription for New Ordinary Shares does not trigger, in the
jurisdiction in which such Placee is resident or located: (i) any
obligation to prepare or file a prospectus or similar document or
any other report with respect to such subscription; (ii) any
disclosure or reporting obligation of the Company; or (iii) any
registration or other obligation on the part of Cantor Fitzgerald
Europe or the Company;
17 each Placee confirms, represents and warrants it is acting as
principal and for no other person and that its Placing
Participation will not give any other person a contractual right to
require the issue by the Company of any New Ordinary Shares;
18 each Placee confirms, represents and warrants that in
accepting its Placing Participation it is not applying for
registration as, or as a nominee or agent for, a person who is or
may be a person mentioned in sections 67 to 72 inclusive and
sections 93 to 97 inclusive of the Finance Act 1986;
19 each Placee confirms, represents and warrants that, to the
extent applicable to it, it is aware of its obligations in
connection with the Criminal Justice Act 1993, the Terrorism Act
2006, the UK Anti-Terrorism Crime and Security Act 2001, the Money
Laundering Regulations 2007, the Proceeds of Crime Act 2002, Part
VIII of the Financial Services and Markets Act 2000 (as amended),
the Financial Services Act 2012 and the Market Abuse Regulation
2016, it has identified its clients in accordance with the Money
Laundering Regulations 2007 and it has complied fully with its
obligations pursuant to those Regulations;
20 each Placee acknowledges and agrees that all times and dates
in this Announcement and the Terms and Conditions set out in this
Appendix may be subject to amendment and that Cantor Fitzgerald
Europe will notify it of any such amendments;
21 each Placee acknowledges and agrees that no term or other
provision of the agreement confirmed by the Confirmation Note shall
be enforceable under the Contracts (Rights of Third Parties) Act
1999 by any person other than Cantor Fitzgerald Europe or any
affiliate of Cantor Fitzgerald Europe or any Indemnified Person (as
hereinafter defined);
22 each Placee acknowledges that any of its monies held or
received by Cantor Fitzgerald Europe will not be subject to the
protections conferred by the FCA's Client Money Rules;
23 each Placee confirms, represents and warrants that it
understands that the New Ordinary 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, accordingly, may not be offered or sold or
otherwise transferred in the United States or to, or for the
account or benefit of, US Persons except pursuant to a registration
statement under the Securities Act or an exemption from the
registration requirements of the Securities Act, and, in connection
with any such transfer, the Company will have the right to obtain,
as a condition to transfer, a legal opinion of counsel, in such
form and by counsel reasonably satisfactory to the Company, that no
such Securities Act registration is or will be required along with
appropriate certifications by the transferee as to the 'Accredited
Investor' status and/or other appropriate matters;
24 each Placee confirms, represents and warrants that it has not
distributed, forwarded, transferred or otherwise transmitted, and
will not distribute, forward, transfer or otherwise transmit, this
Announcement or any other presentation or offering materials
concerning the New Ordinary Shares within the United States, nor
will it do any of the foregoing. Such Placee further confirms that
it understands that the information in this Announcement, including
financial information, may be materially different from any
disclosure that would be provided in a US offering;
25 each Placee agrees, confirms, represents, warrants and undertakes as follows:-
25.1 it is, at the time of the offer and acceptance of the New
Ordinary Shares, outside the United States for the purposes of
Regulation S;
25.2 it will not offer or sell the New Ordinary Shares in the
United States absent registration or an exemption from registration
under the Securities Act;
25.3 it is aware that the New Ordinary Shares are being offered
outside the United States in reliance on Regulation S; and
25.4 it did not purchase or otherwise acquire the New Ordinary
Shares based on or due to directed selling efforts (as defined in
Rule 902 under the Securities Act), including based on an
advertisement in a publication with a general circulation in the
United States, nor has it seen or been aware of any activity that,
to its knowledge, constitutes directed selling efforts in the
United States;
26 if it is subscribing for the New Ordinary Shares in the
United Kingdom, that each Placee is a person falling within the
exemption contained in Section 86(1)(a) of the Financial Services
and Markets Act 2000 (as amended) or falling within one or more of
the categories of persons set out in Article 19 (Investment
Professionals) or Article 49 (High net worth companies,
unincorporated associations etc.) of the Order;
27 each Placee confirms, represents and warrants that, in making
the investment decision with respect to the New Ordinary Shares, it
has:-
27.1 not relied on the Company or any of its respective
affiliates or on any document published by any of them;
27.2 the ability to bear the economic risk of its investment in
the New Ordinary Shares and has no need for liquidity with respect
to its investment in the New Ordinary Shares;
27.3 such knowledge and experience in financial and business
matters that it is capable of evaluating the merits, risks and
suitability of investing in the New Ordinary Shares, and is able to
sustain a complete loss of any investment in the New Ordinary
Shares; and
27.4 investigated independently and made its own assessment and
satisfied itself concerning the relevant tax, legal, currency and
other economic considerations relevant to its investment in the New
Ordinary Shares, including any federal, state and local tax
consequences, affecting it in connection with its subscription for
and any subsequent disposal of the New Ordinary Shares;
28 each Placee acknowledges and agrees that it is not entitled
to the protections afforded to clients of Cantor Fitzgerald Europe
in connection with the Placing and that neither Cantor Fitzgerald
Europe nor any of its affiliates nor any of their respective
officers, directors, employees or advisers shall be liable for any
losses (including, without limitation, loss of profit, loss of
business or opportunity and special interest or consequential
losses), damages or costs of the Placee save as a result of fraud
or for death or personal injury;
29 each Placee acknowledges that the Company, Cantor Fitzgerald
Europe, CREST, the registrar, any transfer agent, any distributors
or dealers and their respective affiliates and others will rely on
the truth and accuracy of the foregoing confirmations, warranties,
acknowledgements, representations, undertakings and agreements, and
agrees to notify the Company and Cantor Fitzgerald Europe promptly
in writing if any of its confirmations, warranties,
acknowledgements, representations, undertakings or agreements set
out above cease to be accurate and complete and to indemnify and
hold harmless on an after-tax basis the Company, Cantor Fitzgerald
Europe and any of their respective officers, directors, agents,
employees or advisers (the "Indemnified Persons") from and against
any and all loss, damage, liability or expense, including
reasonable costs and attorneys' fees and disbursements, which an
Indemnified Person may incur by reason of, or in connection with,
any representation or warranty made by such Placee as set out above
not having been true when made, any misrepresentation made or any
failure by such Placee to fulfil any of its undertakings or
agreements set out above or any other document such Placee provides
to the Company or Cantor Fitzgerald Europe. Such Placee irrevocably
authorises each of the Company and Cantor Fitzgerald Europe to
produce a copy hereof to any interested party in any administrative
or legal proceeding or official inquiry with respect to the matters
covered hereby;
30 each Placee acknowledges that the rights and remedies of
Cantor Fitzgerald Europe and the Company 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 right or remedy will not prevent the exercise of
the other rights and/or remedies; and
31 each Placee undertakes that it (and any person acting on its
behalf) will make payment for the New Ordinary Shares allocated to
it in accordance with this Announcement on the due time and date
set out herein, failing which the relevant New Ordinary Shares may
be placed with other subscribers or sold as Cantor Fitzgerald
Europe may in its sole discretion determine and without liability
to such Placee and such Placee will remain liable for any shortfall
below the net proceeds of such sale and the placing proceeds of
such New Ordinary Shares and may be required to bear the liability
for any stamp duty or stamp duty reserve tax (together with any
interest or penalties due pursuant to or referred to in these Terms
and Conditions) which may arise upon the placing or sale of such
Placee's New Ordinary Shares on its behalf.
CREST and certificated New Ordinary Shares
New Ordinary Shares, once issued, will be admitted to CREST with
effect from Admission. Placees will receive New Ordinary Shares
comprised in their Placing Participation in uncertificated form
registered in their CREST member account. If Placees do not provide
any CREST details or if Placees provide insufficient CREST details
to match within the CREST system to their details, Cantor
Fitzgerald Europe may, at its discretion, deliver New Ordinary
Shares comprised in any such Placee's Placing Participation in
certificated form provided payment has been made in terms
satisfactory to Cantor Fitzgerald Europe and all conditions in
relation to the Placing have been satisfied or waived.
Responsibility
The Terms and Conditions set out in this Appendix and the
Announcement of which it forms part have been issued by the Company
and the Company takes sole responsibility for them.
This information is provided by RNS
The company news service from the London Stock Exchange
END
IOEKMGMZZDVGNZM
(END) Dow Jones Newswires
February 14, 2017 08:01 ET (13:01 GMT)
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