TIDMRHL
RNS Number : 0051I
Redhall Group PLC
14 June 2017
14 June 2017
THIS ANNOUNCEMENT, INCLUDING THE APPIX TO THIS ANNOUNCEMENT, AND
THE INFORMATION CONTAINED HEREIN, IS RESTRICTED AND IS NOT FOR
PUBLICATION, RELEASE OR DISTRIBUTION, DIRECTLY OR INDIRECTLY, IN
WHOLE OR IN PART, IN OR INTO THE UNITED STATES, AUSTRALIA, CANADA,
JAPAN, THE REPUBLIC OF IRELAND OR THE REPUBLIC OF SOUTH AFRICA OR
ANY OTHER JURISDICTION IN WHICH IT WOULD BE UNLAWFUL TO DO SO.
THIS ANNOUNCEMENT, INCLUDING THE APPIX TO THIS ANNOUNCEMENT, IS
FOR INFORMATION PURPOSES ONLY AND DOES NOT ITSELF CONSTITUTE AN
OFFER FOR SALE OR SUBSCRIPTION OF ANY SECURITIES IN THE COMPANY.
THIS ANNOUNCEMENT AND THE APPIX DOES NOT CONSTITUTE OR CONTAIN ANY
INVITATION, SOLICITATION, RECOMMATION, OFFER OR ADVICE TO ANY
PERSON TO SUBSCRIBE FOR, OTHERWISE ACQUIRE OR DISPOSE OF ANY
SECURITIES OF REDHALL GROUP PLC IN ANY JURISDICTION IN WHICH ANY
SUCH OFFER OR SOLICITATION WOULD BE UNLAWFUL.
Redhall Group plc
("Redhall", the "Company" or the "Group")
Proposed placing to raise up to approximately GBP9.5 million at
10 pence per Placing Share
and
Proposed Debt Conversion
Redhall Group plc (AIM: RHL), the high integrity manufacturing
and services group, is pleased to announce its intention to conduct
a placing of up to approximately 95,000,000 new ordinary shares of
0.01 pence each in the Company (the "Placing Shares"), at a price
of 10 pence per Placing Share (the "Issue Price"), to raise up to
approximately GBP9.5 million (before expenses) (the "Placing") and
the conversion of GBP3.75 million of debt owed by the Company to
LOIM into 37,500,000 new ordinary shares of 0.01 pence each in the
Company (the "Conversion Shares") at the Issue Price (the "Debt
Conversion), together (the "Transaction").
The Placing Shares are being offered by way of an accelerated
bookbuilding process (the "Bookbuild"), which will be launched
immediately following this Announcement in accordance with the
terms and conditions set out in the Appendix to this Announcement.
WH Ireland Limited ("WH Ireland") will be acting as sole bookrunner
in connection with the Bookbuild. A further announcement will be
made to confirm the completion of the Bookbuild in due course.
Highlights of the Transaction
-- Proposed placing of up to approximately 95,000,000 Placing
Shares at a price of 10 pence per Placing Share, representing a
premium of 11.1 per cent. to the Closing Price on 13 June 2017, the
last trading day prior to this Announcement, to raise up to
approximately GBP9.5 million (before expenses).
-- LOIM and the Company have entered into the Debt Conversion
Agreement and agreed that, subject inter alia to Admission, GBP3.75
million of the LOIM Debt will be converted as consideration for the
issue of the Conversion Shares (credited as fully paid) at the
Issue Price.
-- The Group's strategic plan continues to be implemented,
focussing on its high integrity manufacturing and services
activities.
-- The Group's order book continues to increase, particularly in
nuclear manufacturing, comprising defence, decommissioning and new
build markets. A combination of new build orders materialising
earlier than anticipated and a high volume of defence,
decommissioning and infrastructure orders moving from engineering
into production has resulted in a funding opportunity to support
the increased workload. New working capital investment will further
support growth, together with continued investment in product
development, processes and equipment.
-- The Transaction will give the Group sufficient working
capital to deliver its growing order book and pipeline - allowing
for investment, increased margins and an ability to better position
the Group to participate in its enlarged core markets. In addition,
this restructuring of the Company's balance sheet and additional
funding will position the Group to address significant, long term
market opportunities.
-- Completion of the Transaction is subject, inter alia, to
Shareholder approval, which will be sought at the General Meeting
to be held at the offices of Squire Patton Boggs (UK) LLP, 6
Wellington Place, Leeds LS1 4AP at 11.00 a.m. on 30 June 2017.
-- A circular containing further details of the Transaction and
including the Notice of the General Meeting (the "Circular") is
expected to be available on the Company's website at
www.redhallgroup.co.uk later today and will thereafter be posted to
Shareholders.
-- Dealings in the New Ordinary Shares issued pursuant to the
Transaction are expected to commence on 5 July 2017.
Redhall's Chief Executive, Phil Brierley, said:
"We are very pleased with progress in the first half of our
financial year, particularly in the increase in our order book. New
build orders in the nuclear sector are coming through faster than
anticipated, which is very encouraging for Redhall. The Placing and
the Debt Conversion announced today will help us to deliver these
orders effectively and to capitalise on other opportunities
available to the Group as it implements its growth strategy."
Expected Timetable
2017
Announcement of the Transaction, 7.00 a.m. on
Bookbuild commences 14 June
Posting of the Circular and Form 14 June
of Proxy
Latest time and date for receipt 11.00 a.m.
of Forms of Proxy on 28 June
General Meeting 11.00 a.m.
on 30 June
Admission and commencement of dealings 8.00 a.m. on
in the New Ordinary Shares 5 July
CREST accounts to be credited with 8.00 a.m. on
New Ordinary Shares 5 July
Each of the times and dates above refer to London time and are
subject to change. Any such change will be notified to Shareholders
by an announcement on a Regulatory Information Service.
Additional information on the Transaction is included below.
Attention is also drawn to the section headed 'Important
Information' and to the Appendix to this Announcement containing,
inter alia, the terms and conditions of the Placing (representing
important information for Placees only). The number of Placing
Shares to be issued in connection with the Placing will be agreed
by Redhall and WH Ireland at the close of the Bookbuild process,
and the results of the Placing will be announced as soon as
practicable thereafter. The timing of the closing of the book,
pricing and allocations is at the absolute discretion of Redhall
and WH Ireland.
Terms used but not defined in this Announcement shall have the
meanings given to such terms in the Definitions section of the
Appendix to this Announcement.
This Announcement contains inside information for the purposes
of Article 7 of EU Regulation 596/2014 ("MAR"). In addition, 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 defined in MAR), as permitted by MAR. This inside
information is set out in this Announcement. Therefore, those
persons that received inside information in a market sounding are
no longer in possession of such inside information relating to the
Company and its securities.
Contact details:
Redhall Group plc Tel: +44 (0)
Phil Brierley, Chief Executive 1924 385 386
Chris Kelly, Group Finance Director Tel: +44 (0)
WH Ireland, Broker 20 7220 1666
Adrian Hadden, Ed Allsopp, James Sinclair-Ford (Corporate Tel: +44 (0)
Finance) 20 7466 5000
Jasper Berry (Corporate Broking) Tel: +44 (0)
Buchanan, PR 845 505 4343
Mark Court, Sophie Cowles
GCA Altium, NOMAD
Tim Richardson
Additional Information
1. Introduction
The Company has today announced the Transaction which, if
approved by Shareholders and otherwise becomes unconditional, is
intended to better position the Group to address the significant
market opportunities available to it and to create Shareholder
value over the medium term.
The Transaction includes:
-- the Placing of up to approximately 95,000,000 Placing Shares
with institutional and other investors, at the Issue Price to raise
up to approximately GBP9.5 million (before expenses); and
-- the Debt Conversion, which will convert GBP3.75 million of
the LOIM Debt into 37,500,000 Conversion Shares at the Issue
Price.
Currently the Directors do not have sufficient authorities to
allot the New Ordinary Shares without the need first to offer the
New Ordinary Shares to existing Shareholders. Accordingly, the
Placing and the Debt Conversion are conditional upon the Company,
inter alia, obtaining approval from Shareholders to empower the
Directors to allot the New Ordinary Shares pursuant to the Placing
and the Debt Conversion and to disapply statutory pre-emption
rights in respect of such allotment.
The Placing, which is being arranged on behalf of the Company by
WH Ireland subject to the terms of the Placing Agreement, is
conditional, inter alia, on the passing of the Resolutions at the
General Meeting expected to be held at 11.00 a.m. on 30 June 2017,
notice of which will be given in the Circular.
In the event that the Resolutions are not passed, neither the
Placing nor the Debt Conversion will proceed. The Placing is not
being underwritten by WH Ireland nor by any other party.
The Board believes that raising equity finance using the
flexibility provided by a non pre-emptive placing is the most
appropriate and optimal structure for the Company at this time.
2. Background to, and reasons for, the Transaction
Following the successful Group restructuring which completed in
2015, the second stage of the Group's agreed strategic turnaround
plan focused on establishing the platform for a high integrity
manufacturing and services provider through business improvement,
building a high quality order book, improving processes and
investing in R&D and equipment. This improvement process was a
key focus for the Board in 2016 and is continuing through 2017.
Today the Group's operations consist of five businesses
operating in high integrity manufacturing and services covering
complex and hazardous environments.
The manufacturing businesses encompass the design,
manufacturing, installation and commissioning of high integrity
products and equipment typically in the nuclear and oil & gas
sectors but also in large infrastructure projects. The Group has
three businesses with strong brands and heritage in their
respective areas: Booth Industries, Jordan Manufacturing and R
Blackett Charlton.
The services businesses provide installation and maintenance of
telecommunications network infrastructure and design and the
manufacture and installation of process lines in food and
pharmaceutical markets. The Group delivers these services through
Redhall Networks and Redhall Jex.
The Group's order book continues to grow in terms of volume and
quality, with the proportion of higher margin manufacturing orders
increasing as a result of the Group's strategic focus. As at 6 June
2017, the Group's order book had progressed to GBP32 million (31
December 2016: GBP27 million), of which GBP26 million was
manufacturing, with the progress driven particularly by the award
of contracts in the nuclear sector. A significant element of the
manufacturing order book, which tends to have higher capital needs,
is scheduled to move into production before the financial year
end.
In addition, the Group has a significant pipeline of outstanding
bids and additional opportunities have been identified. As a
result, the Board expects a high level of tender activity over the
medium term and has confidence in the Group's ability to continue
to increase its activity in its core markets. The Board believes
that there is a particularly significant market opportunity to
capitalise on projects in the nuclear market, across defense,
decommissioning and increasingly, new build.
The third (and current) stage of the Group's strategic plan is
to accelerate growth in key markets, delivering the growing order
book, investing in the Group to increase competitiveness and
bringing on additional capacity and capabilities.
The Transaction is intended to provide the Company with the
flexibility to implement this third stage. The Placing and the Debt
Conversion will provide the working capital required to fund the
anticipated growth in manufacturing activities and deliver the
Group's growing order book and pipeline and improve the strength of
the Group's balance sheet. The Transaction is also expected to
allow for better trading terms with the Group's supply chain,
improve competitiveness and fund the investment in the people,
plant, equipment, processes and technology required to meet
customer requirements and drive further shareholder value.
In addition, the Placing may introduce additional shareholders
to the Company's register, providing a broader base from which to
support its future growth.
3. Current trading and prospects
The Company announced its unaudited results for the six months
ended 31 March 2017 at 7.00 a.m. on 14 June 2017 (the "Interim
Announcement"). The Interim Announcement highlighted an adjusted
operating profit of GBP0.18 million (2016: loss of GBP0.09 million)
on revenue of GBP19.0 million (2016: GBP21.4 million). Operating
profit margins (before central costs) increased by 130 basis points
to 6.5 per cent.
The Interim Announcement contains the following statement on
current trading:
"Our trading remains in line with full year market expectations
and we are confident that the investment and improvements already
made in the business, coupled with the increasing order book and
substantial improvement in capital base, will deliver profitable
growth and return long term benefits for our stakeholders."
4. Details of the Placing
The Company is proposing to raise up to approximately GBP9.5
million (before expenses) in aggregate pursuant to the Placing. The
Issue Price of 10 pence per New Ordinary Share represents a premium
of approximately 11.1 per cent. to the Closing Price of 9.0 pence
on 13 June 2017, the latest trading day prior to this
Announcement.
The Placing will be conducted by way of a non pre-emptive share
issue. The Directors believe that this is the most cost effective
and certain method to raise funds, avoiding the significant costs
and uncertainty of a full public offer requiring a prospectus, and
also facilitates the diversification of the institutional
shareholder base. The Directors consider that the potential
long-term value creation benefit to Shareholders arising from the
application of the net Placing proceeds outweighs the dilutive
effects of the Placing.
The Placing Shares are being offered by way of an accelerated
bookbuilding process (the "Bookbuild"), which will be launched
immediately following this Announcement in accordance with the
terms and conditions set out in the Appendix to this Announcement.
WH Ireland will be acting as sole bookrunner in connection with the
Bookbuild. The Placing is not being underwritten.
The Bookbuild will determine final demand for and participation
in the Placing. The timing of the closing of the Bookbuild is at
the absolute discretion of the Company and WH Ireland, but is
expected to be no later than 4.30 p.m. today 14 June 2017. The
allocations will be determined by the Company and WH Ireland in
their absolute discretion and will be confirmed orally or by email
by WH Ireland following the close of the Bookbuild. A further
announcement of the results of the Placing will be made by the
Company following the completion of the Bookbuild.
The Placing Shares will not be offered generally to the
Company's existing Shareholders on a pre-emptive basis.
Participation in the Placing will generally be limited to certain
qualifying institutional investors who are invited, and who choose,
to participate. The Placing Shares are not being made available to
the public and are not being offered or sold in, into or from the
United States of America, Canada, Australia, Japan, the Republic of
Ireland or the Republic of South Africa or any other jurisdiction
where it would be unlawful to do so.
Phil Brierley, Chris Kelly and Martin Everett, all of whom are
Directors, have indicated an intention to subscribe for, in
aggregate, GBP0.1 million worth of Placing Shares in the
Placing.
Currently the Directors do not have sufficient authorities to
allot the Placing Shares to the Placees without first offering them
to existing Shareholders. Accordingly, the Placing is conditional
upon the Company, inter alia, obtaining approval from Shareholders
to empower the Directors to allot the Placing Shares pursuant to
the Placing and to disapply statutory pre-emption rights in respect
of such allotment.
The Placing Shares will be issued credited as fully paid and
will rank in full for all dividends and other distributions
declared, made or paid after the admission of the Placing Shares
and will otherwise rank on admission pari passu in all respects
with the Existing Ordinary Shares. The Placing Shares are not being
made available to the public and are not being offered or sold in
any jurisdiction where it would be unlawful to do so. The Placing
is not being underwritten.
The Placing, which is being arranged on behalf of the Company by
WH Ireland subject to the terms of the Placing Agreement, is
conditional, inter alia, upon:
(i) the passing without amendment (or with such amendments as
may be agreed between WH Ireland, GCA Altium and the Company) of
the Resolutions at the General Meeting;
(ii) the Placing Agreement becoming unconditional in all
respects (save for the condition relating to Admission) and not
having being terminated in accordance with its terms; and
(iii) Admission taking place not later than 8.00 a.m. on 5 July
2017 (or such later time and / or date as the Company and WH
Ireland may agree, being not later than 31 July 2017).
The Placing Agreement contains customary warranties and
indemnities given by the Company with respect to its business and
the Group and to certain matters connected with the Placing. The
Placing may be terminated by WH Ireland and/or GCA Altium in the
event of, inter alia, a material breach by the Company of the terms
of the Placing Agreement (including the warranties) or a material
adverse change in the condition of the Group. Under the terms of
the Placing Agreement, the Company has agreed to pay WH Ireland, in
consideration for its broking services in respect of the Placing, a
commission representing a percentage of the gross proceeds raised
in the Placing and the Company has agreed to pay GCA Altium a fixed
corporate finance fee.
Application will be made to the London Stock Exchange for the
Placing Shares to be admitted to trading on AIM. It is expected
that Admission will be effective and trading in the Placing Shares
will commence at 8.00 a.m. on 5 July 2017.
If the Resolutions are not passed by Shareholders at the General
Meeting, the Placing will not proceed.
The Appendix to this Announcement (which forms a part of this
Announcement) contains the detailed terms and conditions of the
Placing
5. The Debt Conversion
As part of the Transaction, LOIM and the Company have entered
into the Debt Conversion Agreement and agreed that, subject, inter
alia, to Admission, GBP3.75 million of the LOIM Debt will be
converted as consideration for the issue of the 37,500,000
Conversion Shares, credited as fully paid.
Application will be made to the London Stock Exchange for the
Conversion Shares to be admitted to trading on AIM. It is expected
that Admission will be effective and trading in the Conversion
Shares will commence at 8.00 a.m. on 5 July 2017. Following
Admission, LOIM will be interested in 92,587,179 Ordinary Shares
representing approximately 27.84 per cent. of the Enlarged Issued
Share Capital. It will remain restricted to holding a maximum of
29.9 per cent. of the Company's issued Ordinary Shares.
As LOIM currently holds approximately 27.54 per cent. of the
Existing Ordinary Shares it is a "substantial shareholder" under
the AIM Rules and the Debt Conversion constitutes a related party
transaction for the purposes of AIM Rule 13. The Independent
Director, who is not involved in either the Placing or the Debt
Conversion, considers having consulted with GCA Altium, the
Company's nominated adviser, that the terms of Debt Conversion are
fair and reasonable insofar as Shareholders are concerned.
The Debt Conversion is conditional on the passing, without
amendment (or with such amendments as may be agreed between WH
Ireland, GCA Altium and the Company), of the Resolutions at the
General Meeting. If the Resolutions are not passed by Shareholders
at the General Meeting, the Debt Conversion will not proceed.
Whilst the Debt Conversion will reduce the Group's overall
indebtedness, the Board has entered into negotiations with the
Group's bankers, HSBC Bank plc to increase the facilities available
from the bank to the Group. The Board has secured an agreement in
principle to increase its facilities with HSBC from GBP5.525
million to GBP8.0 million, consisting of a GBP5.525 million
revolving credit facility with a GBP2.475 million accordion
facility, at more favorable rates.
6. Principal Risks and Uncertainties
A description of the principal risks and uncertainties
associated with the Group's business and how the Group seeks to
manage them is included on page 9 of the Group's Annual Report and
Accounts for the year ended 30 September 2016. The Board is of the
view that these principal risks and uncertainties are those which
continue to be applicable to the business at the date of the
Circular.
7. Irrevocable undertakings
The Company has received irrevocable undertakings to vote in
favour of the Resolutions from Shareholders who have a beneficial
interest in respect of, in aggregate, 107,058,070 Existing Ordinary
Shares representing approximately 53.52 per cent. of the Existing
Issued Share Capital. This includes irrevocable undertakings to
vote in favour of such Resolutions received from Directors holding,
in aggregate, 2,280,891 Existing Ordinary Shares representing
approximately 1.14 per cent. of the Existing Issued Share
Capital.
8. Notice of General Meeting
The Circular will contain a Notice convening the General Meeting
to be held at 11.00 a.m. on 30 June 2017 at the offices of Squire
Patton Boggs (UK) LLP, 6 Wellington Place, Leeds, LS1 4AP at which
the Company is proposing that Shareholders pass the Resolutions in
order to:
-- provide sufficient authority to issue the New Ordinary Shares; and
-- provide authority to allow the New Ordinary Shares to be
issued without having to comply with statutory pre-emption
rights.
9. Admission, Settlement and CREST
Application will be made to the London Stock Exchange for the
Admission of the New Ordinary Shares to trading on AIM. It is
expected that Admission will become effective at 8.00 a.m. on 5
July 2017 and that dealings in the New Ordinary Shares will
commence at that time.
The Articles permit the Company to issue shares in
uncertificated form. CREST is a computerised paperless share
transfer and settlement system which allows shares and other
securities to be held in electronic rather than paper form. The
Ordinary Shares are already admitted to CREST and therefore the New
Ordinary Shares will also be eligible for settlement in CREST. The
New Ordinary Shares due to uncertificated holders are expected to
be delivered in CREST on 5 July 2017.
10. Directors' recommendation
The Directors consider the Resolutions to be proposed at the
General meeting to be in the best interests of the Company and the
Shareholders as a whole. Consequently the Directors unanimously
recommend that Shareholders vote in favour of the Resolutions to be
proposed at the General Meeting as they have irrevocably undertaken
to do in respect of their aggregate shareholdings of 2,280,891
Existing Ordinary Shares representing approximately 1.14 per cent.
of the Existing Issued Share Capital.
IMPORTANT INFORMATION
The distribution of this announcement and the offering of the
Placing Shares in certain jurisdictions may be restricted or
prohibited by law or regulation. Persons distributing this
announcement must satisfy themselves that it is lawful to do so. No
action has been taken by the Company or WH Ireland that would
permit an offering of such shares or possession or distribution of
this announcement or any other offering or publicity material
relating to such shares in any jurisdiction where action for that
purpose is required. Persons into whose possession this
announcement comes are required by the Company and WH Ireland to
inform themselves about, and to observe, such restrictions.
This announcement contains (or may contain) certain
forward-looking statements with respect to certain of the Company's
current expectations and projections about future events. These
statements, which sometimes use words such as "anticipate",
"believe", "intend", "estimate", "expect" and words of similar
meaning, reflect the directors' beliefs and expectations and
involve a number of risks, uncertainties and assumptions that could
cause actual results and performance to differ materially from any
expected future results or performance expressed or implied by any
such forward-looking statement. Statements contained in this
announcement regarding past trends or activities should not be
taken as a representation that such trends or activities will
continue in the future. The information contained in this
announcement is subject to change without notice and neither WH
Ireland nor, except as required by applicable law, the Company
assumes any responsibility or obligation to update publicly or
review any of the forward-looking statements contained herein. You
should not place undue reliance on forward-looking statements,
which speak only as of the date of this announcement.
WH Ireland, which is authorised and regulated in the United
Kingdom by the Financial Conduct Authority, is acting as broker to
the Company in relation to the Transaction and is not acting for
any other persons in relation to the Transaction. WH Ireland is
acting exclusively for the Company and for no one else in relation
to the matters described in this announcement and is not advising
any other person and accordingly will not be responsible to anyone
other than the Company for providing the protections afforded to
clients of WH Ireland, or for providing advice in relation to the
contents of this announcement or any matter referred to in it.
GCA Altium, which is authorised and regulated in the United
Kingdom by the Financial Conduct Authority, is acting as nominated
adviser to the Company in relation to the Placing and Admission and
is not acting for any other persons in relation to the Transaction.
GCA Altium is acting exclusively for the Company and for no one
else in relation to the matters described in this announcement and
is not advising any other person and accordingly will not be
responsible to anyone other than the Company for providing the
protections afforded to clients of GCA Altium, or for providing
advice in relation to the contents of this announcement or any
matter referred to in it. The responsibilities of GCA Altium as the
Company's nominated adviser under the AIM Rules for Companies and
the AIM Rules for Nominated Advisers are owed solely to the London
Stock Exchange and are not owed to the Company or to any director
or shareholder of the Company or any other person, in respect of a
decision to acquire shares in the capital of the Company in
reliance on any part of this announcement, or otherwise.
No representation or warranty, express or implied, is or will be
made as to, or in relation to, and no responsibility or liability
is or will be accepted by WH Ireland or GCA Altium or by any of
their affiliates or agents as to, or in relation to, the accuracy
or completeness of this announcement or any other written or oral
information made available to or publicly available to any
interested party or its advisers, and any liability therefor is
expressly disclaimed.
APPIX
TERMS AND CONDITIONS OF THE PLACING
THIS ANNOUNCEMENT, INCLUDING THIS APPIX (TOGETHER, THE
"ANNOUNCEMENT") AND THE INFORMATION IN IT IS RESTRICTED AND IS NOT
FOR PUBLICATION, RELEASE OR DISTRIBUTION, DIRECTLY OR INDIRECTLY,
IN WHOLE OR IN PART, IN OR INTO THE UNITED STATES, AUSTRALIA,
CANADA, JAPAN, THE REPUBLIC OF SOUTH AFRICA OR ANY OTHER
JURISDICTION IN WHICH SUCH PUBLICATION OR DISTRIBUTION WOULD BE
UNLAWFUL.
IMPORTANT INFORMATION ON THE PLACING FOR INVITED PLACEES
ONLY.
MEMBERS OF THE PUBLIC ARE NOT ELIGIBLE TO TAKE PART IN THE
PLACING. THIS APPIX AND THE TERMS AND CONDITIONS SET OUT HEREIN ARE
FOR INFORMATION PURPOSES ONLY AND ARE DIRECTED ONLY AT: (A) PERSONS
WHO ARE IN A MEMBER STATE OF THE EUROPEAN ECONOMIC AREA AND ARE,
UNLESS OTHERWISE AGREED BY WH IRELAND, "QUALIFIED INVESTORS" AS
DEFINED IN ARTICLE 2.1(E) OF THE EU PROSPECTUS DIRECTIVE (WHICH
MEANS DIRECTIVE 2003/71/EC AND INCLUDES ANY RELEVANT IMPLEMENTING
DIRECTIVE MEASURE IN ANY MEMBER STATE) (THE "PROSPECTUS
DIRECTIVE"); AND (B) IN THE UNITED KINGDOM, PERSONS WHO ARE: (I)
"INVESTMENT PROFESSIONALS" WITHIN THE MEANING OF ARTICLE 19(5) OF
THE FINANCIAL SERVICES AND MARKETS ACT 2000 (FINANCIAL PROMOTION)
ORDER 2005 (THE "ORDER"); (II) PERSONS FALLING WITHIN ARTICLE
49(2)(A) TO (D) ("HIGH NET WORTH COMPANIES, UNINCORPORATED
ASSOCIATIONS, ETC") OF THE ORDER; OR (III) PERSONS TO WHOM IT MAY
OTHERWISE BE LAWFULLY COMMUNICATED (ALL SUCH PERSONS TOGETHER BEING
REFERRED TO AS "RELEVANT PERSONS"). THIS APPIX AND THE TERMS AND
CONDITIONS SET OUT HEREIN MUST NOT BE ACTED ON OR RELIED ON BY
PERSONS WHO ARE NOT RELEVANT PERSONS. ANY INVESTMENT OR INVESTMENT
ACTIVITY TO WHICH THIS APPIX AND THE TERMS AND CONDITIONS SET OUT
HEREIN RELATE IS AVAILABLE ONLY TO RELEVANT PERSONS AND WILL BE
ENGAGED IN ONLY WITH RELEVANT PERSONS.
THIS ANNOUNCEMENT IS NOT AN OFFER FOR SALE OR SUBSCRIPTION IN
ANY JURISDICTION IN WHICH SUCH OFFER, SOLICITATION OR SALE WOULD BE
UNLAWFUL UNDER THE SECURITIES LAWS OF ANY JURISDICTION. THIS
ANNOUNCEMENT DOES NOT ITSELF CONSTITUTE AN OFFER FOR SALE OR
SUBSCRIPTION OF ANY SECURITIES IN THE COMPANY. THIS ANNOUNCEMENT IS
NOT AN OFFER OF OR SOLICITATION TO PURCHASE OR SUBSCRIBE FOR
SECURITIES IN THE UNITED STATES. THE SECURITIES REFERRED TO HEREIN
HAVE NOT BEEN AND WILL NOT BE REGISTERED UNDER THE U.S. SECURITIES
ACT OF 1933, AS AMED (THE "SECURITIES ACT"), AND MAY NOT BE OFFERED
OR SOLD IN THE UNITED STATES, EXCEPT PURSUANT TO AN APPLICABLE
EXEMPTION FROM, OR AS PART OF A TRANSACTION NOT SUBJECT TO, THE
REGISTRATION REQUIREMENTS OF THE SECURITIES ACT. NEITHER THE UNITED
STATES SECURITIES AND EXCHANGE COMMISSION NOR ANY SECURITIES
REGULATORY AUTHORITY OF ANY STATE OR OTHER JURISDICTION OF THE
UNITED STATES HAS APPROVED OR DISAPPROVED OF AN INVESTMENT IN THE
SECURITIES OR PASSED UPON ORORSED THE MERITS OF THE PLACING OR THE
ACCURACY OR ADEQUACY OF THE CONTENTS OF THIS ANNOUNCEMENT. ANY
REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENCE IN THE UNITED
STATES. NO PUBLIC OFFERING OF SECURITIES IS BEING MADE IN THE
UNITED STATES.
EACH PLACEE SHOULD CONSULT WITH ITS OWN ADVISERS AS TO LEGAL,
TAX, BUSINESS AND RELATED ASPECTS OF AN INVESTMENT IN PLACING
SHARES. THE PRICE OF SHARES AND THE INCOME FROM THEM (IF ANY) MAY
GO DOWN AS WELL AS UP AND INVESTORS MAY NOT GET BACK THE FULL
AMOUNT INVESTED ON DISPOSAL OF SHARES.
These terms and conditions apply to persons making an offer to
acquire Placing Shares (as defined below). Each person to whom
these conditions apply, as described above, who confirms his
agreement, either orally or in writing, to WH Ireland to acquire
Placing Shares (each a "Placee") hereby agrees with WH Ireland and
the Company to be bound by these terms and conditions as being the
terms and conditions upon which Placing Shares will be issued or
acquired. A Placee shall, without limitation, become so bound if WH
Ireland confirms to such Placee its allocation of Placing
Shares.
Upon being notified of its allocation of Placing Shares, a
Placee shall be contractually committed to acquire the number of
Placing Shares allocated to it at the Placing Price and, to the
fullest extent permitted by law, will be deemed to have agreed not
to exercise any rights to rescind or terminate or otherwise
withdraw from such commitment.
This Announcement does not constitute an offer, and may not be
used in connection with an offer, to sell or issue or the
solicitation of an offer to buy or subscribe for Placing Shares in
any jurisdiction in which such offer or solicitation is or may be
unlawful. This Announcement and the information contained herein is
not for publication or distribution, in whole or in part, directly
or indirectly, to persons in the United States, Australia, Canada,
Japan, the Republic of South Africa or in any jurisdiction in which
such publication or distribution would be unlawful. Persons into
whose possession this Announcement may come are required by the
Company to inform themselves about and to observe any restrictions
of transfer of this Announcement. No public offer of securities of
the Company is being made in the United Kingdom, the United States
or elsewhere.
In particular, the Placing Shares referred to in this
Announcement have not been and will not be registered under the
Securities Act or any laws of 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
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 the securities laws of any state or other
jurisdiction of 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 or the South African Reserve
Bank; and the Placing Shares have not been, nor will they be,
registered under or offered in compliance with the securities laws
of any state, province or territory of Australia, Canada, Japan or
the Republic of South Africa. 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, Canada, Japan, the Republic of
South Africa or any other jurisdiction in which such offer, sale,
resale or delivery would be unlawful.
Persons (including, without limitation, nominees and trustees)
who have a contractual or other legal obligation to forward a copy
of this Appendix or the Announcement of which it forms part should
seek appropriate advice before taking any action.
In this Appendix, unless the context otherwise requires,
"Placee" means a Relevant Person (including individuals, funds or
others) on whose behalf a commitment to subscribe for or acquire
Placing Shares has been given.
Details of the Placing Agreement and the Placing Shares
WH Ireland has entered into a Placing Agreement (the "Placing
Agreement") with the Company and GCA Altium Limited, nominated
adviser and financial adviser to the Company ("GCA Altium"), under
which WH Ireland has, on the terms and subject to the conditions
set out therein, undertaken to use its reasonable endeavours to
procure subscribers for new ordinary shares of 0.01 pence each in
the capital of the Company (the "Placing Shares"). It is expected
that the Placing will raise up to approximately GBP9.5 million in
gross proceeds at a price of 10 per ordinary share (the "Placing
Price") with up to approximately 95,000,000 Placing Shares expected
to be placed. The Placing is not being underwritten by WH Ireland,
GCA Altium or any other person.
The number of Placing Shares will be determined following
completion of the Bookbuild (as defined below) as set out in this
Announcement.
The Placing Shares will, when issued, be subject to the articles
of association of the Company, will be credited as fully paid and
will rank pari passu in all respects with the existing issued
ordinary shares of 0.01 pence each in the capital of the Company
("Ordinary Shares"), including the right to receive all dividends
and other distributions (if any) declared, made or paid on or in
respect of the Ordinary Shares after the date of issue of the
Placing Shares.
The Placing Shares will trade on AIM under RHL, with ISIN
GB0001112035.
Application for admission to trading
Application will be made to London Stock Exchange plc (the
"London Stock Exchange") for admission to trading of the Placing
Shares on AIM ("Admission"). It is expected that settlement of any
such shares and Admission will become effective on or around 5 July
2017 and that dealings in the Placing Shares will commence at that
time.
Bookbuild
WH Ireland will today commence an accelerated bookbuilding
process (the "Bookbuild") to determine demand for participation in
the Placing by potential Placees at the Placing Price. This
Appendix gives details of the terms and conditions of, and the
mechanics of participation in, the Placing. No commissions will be
paid to Placees or by Placees in respect of any Placing Shares.
WH Ireland and the Company shall be entitled to effect the
Placing by such alternative method to the Bookbuild as they may, in
their sole discretion, determine.
Participation in, and principal terms of, the Placing
1. WH Ireland is arranging the Placing as agent for, and broker
of, the Company.
2. Participation in the Placing is only available to persons who
are lawfully able to be, and have been, invited to participate by
WH Ireland. WH Ireland is entitled to participate in the Placing as
principal.
3. The Bookbuild will establish the number of Placing Shares to
be issued at the Placing Price, which will be agreed between WH
Ireland and the Company following completion of the Bookbuild. The
number of Placing Shares will be announced on a Regulatory
Information Service following the completion of the Bookbuild.
4. To bid in the Bookbuild, Placees should communicate their bid
by telephone to their usual contact at WH Ireland Corporate &
Institutional Broking. Each bid should state the number of Placing
Shares which the prospective Placee wishes to subscribe for or
purchase at the Placing Price. Bids may be scaled down by WH
Ireland on the basis referred to in paragraph 8 below.
5. The timing of the closing of the Bookbuild will be at the
discretion of WH Ireland. The Company reserves the right to reduce
or seek to increase the amount to be raised pursuant to the
Placing, in its absolute discretion.
6. Each Placee's allocation will be confirmed to Placees orally,
or by email, by WH Ireland following the close of the Bookbuild and
a trade confirmation or contract note will be dispatched as soon as
possible thereafter. WH Ireland's oral or emailed confirmation will
give rise to an irrevocable, legally binding commitment by that
person (who at that point becomes a Placee), in favour of WH
Ireland and the Company, under which it agrees to acquire by
subscription the number of Placing Shares allocated to it at the
Placing Price and otherwise on the terms and subject to the
conditions set out in this Appendix and in accordance with the
Company's articles of association. Except with WH Ireland's
consent, such commitment will not be capable of variation or
revocation.
7. The Company will make a further announcement following the
close of the Bookbuild detailing the number of Placing Shares to be
issued at the Placing Price.
8. Subject to paragraphs 4 and 5 above, WH Ireland may choose
not to accept bids and/or to accept bids, either in whole or in
part, on the basis of allocations determined at their discretion
(after consultation with the Company) and may scale down any bids
for this purpose on such basis as it may determine. WH Ireland may
also, notwithstanding paragraphs 4 and 5 above, subject to the
prior consent of the Company, allocate Placing Shares after the
time of any initial allocation to any person submitting a bid after
that time.
9. A bid in the Bookbuild will be made on the terms and subject
to the conditions in the Announcement (including this Appendix) and
will be legally binding on the Placee on behalf of which it is made
and except with WH Ireland's consent will not be capable of
variation or revocation from the time at which it is submitted.
10. Except as required by law or regulation, no press release or
other announcement will be made by WH Ireland 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.
11. Irrespective of the time at which a Placee's allocation
pursuant to the Placing is confirmed, settlement for all Placing
Shares to be acquired pursuant to the Placing will be required to
be made at the same time, on the basis explained below under
"Registration and Settlement".
12. All obligations of WH Ireland 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 "Right to terminate under the
Placing Agreement".
13. 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.
14. To the fullest extent permissible by law and the applicable
rules of the Financial Conduct Authority ("FCA"), neither WH
Ireland nor any of its affiliates shall have any liability to
Placees (or to any other person whether acting on behalf of a
Placee or otherwise whether or not a recipient of these terms and
conditions) in respect of the Placing. Each Placee acknowledges and
agrees that the Company is responsible for the allotment of the
Placing Shares to the Placees and WH Ireland and its affiliates
shall have no liability to the Placees for the failure of the
Company to fulfil those obligations. In particular, neither WH
Ireland nor any of its affiliates shall have any liability
(including to the extent permissible by law, any fiduciary duties)
in respect of WH Ireland's conduct of the Placing.
Conditions of the Placing
WH Ireland's obligations under the Placing Agreement in respect
of the Placing Shares are conditional on, inter alia:
(a) the passing, without amendment (or with such amendments as
may be agreed between WH Ireland and GCA Altium), of the
Resolutions at the General Meeting;
(b) the Company allotting the Placing Shares, prior to and
conditional only on Admission, in accordance with the terms of the
Placing Agreement;
(c) Admission taking place not later than 8.00 a.m. on 5 July
2017 (or such later time or date as the Company and WH Ireland may
agree, not later than 8.00 a.m. on 31 July 2017); and
(d) the Placing Agreement becoming unconditional in all respects
(save for the condition relating to Admission) and not having been
terminated in accordance with its terms.
If: (i) any of the conditions contained in the Placing Agreement
in relation to the Placing Shares are not fulfilled or waived by WH
Ireland and, where applicable, GCA Altium, by the respective time
or date where specified (or such later time or date as WH Ireland
or, where applicable, WH Ireland and GCA Altium may notify to the
Company, not being later than 8.00 a.m. on 5 July 2017); (ii) any
of such conditions becomes incapable of being fulfilled; or (iii)
the Placing Agreement is terminated in the circumstances specified
below, the Placing will lapse and the Placees' rights and
obligations hereunder in relation to the Placing Shares shall cease
and terminate at such time and each Placee agrees that no claim can
be made by the Placee in respect thereof.
WH Ireland and GCA Altium may, at their discretion and upon such
terms as they think fit, waive, or extend the period for,
compliance by the Company with the whole or any part of any of the
Company's obligations in relation to the conditions in the Placing
Agreement save that the above conditions relating to the passing of
the Resolutions and Admission taking place may not be waived. Any
such extension or waiver will not affect Placees' commitments as
set out in this Announcement.
Neither WH Ireland, GCA Altium, the Company nor any of their
respective affiliates 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 they 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 nor for any decision they may make as to
the satisfaction of any condition or in respect of the Placing
generally and by participating in the Placing each Placee agrees
that any such decision is within the absolute discretion of WH
Ireland and GCA Altium.
Right to terminate the Placing Agreement
WH Ireland and GCA Altium is each entitled, at any time before
Admission, to terminate the Placing Agreement by giving notice to
the Company in certain circumstances, including, inter alia:
(a) a breach by the Company of any of its obligations under the
Placing Agreement and such failure is material in the context of
the Proposals;
(b) any of the warranties given in the Placing Agreement not
being true and accurate or becoming misleading, in each case in a
way that is material in the context of the Proposals;
(c) the occurrence of a specified force majeure event which, in
the good faith sole judgement of WH Ireland and GCA Altium is
likely to materially prejudice the success of the Proposals,
provided that GCA Altium may only exercise any such right of
termination to the extent that the event, matter or circumstance
concerned materially affects, or is materially relevant to, GCA
Altium in its capacity as nominated adviser to the Company, whether
under the terms of its nominated adviser agreement with the
Company, the AIM Rules, the AIM Rules for GCA Altium or
otherwise.
The rights and obligations of the Placees will not be subject to
termination by the Placees or any prospective Placees at any time
or in any circumstances. By participating in the Placing, Placees
agree that the exercise by WH Ireland or GCA Altium of any right of
termination or other discretion under the Placing Agreement shall
be within the absolute discretion of WH Ireland or GCA Altium, as
applicable, and that neither need make any reference to Placees and
that neither WH Ireland, GCA Altium nor any of their respective
affiliates shall have any liability to Placees whatsoever in
connection with any such exercise.
No Admission Document or 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 the publication of an admission
document or prospectus in the United Kingdom or in any other
jurisdiction. No offering document, admission document or
prospectus has been or will be submitted to be approved by the FCA
in relation to the Placing, and Placees' commitments will be made
solely on the basis of the information contained in the
Announcement (including this Appendix) and the business and
financial information that the Company is required to publish in
accordance with the AIM Rules for Companies (the "Exchange
Information"). Each Placee, by accepting a participation in the
Placing, agrees that the content of this Announcement is
exclusively the responsibility of the Company and confirms that it
has neither received nor relied on any other information (other
than the Exchange Information), representation, warranty, or
statement made by or on behalf of the Company, GCA Altium or WH
Ireland or any other person and neither WH Ireland, GCA Altium, the
Company nor any other person will be liable for any Placee's
decision to participate in the Placing based on any other
information, representation, warranty or statement which the
Placees may have obtained or received and, if given or made, such
information, representation, warranty or statement must not be
relied upon as having been authorised by WH Ireland, GCA Altium,
the Company, or their respective officers, directors, employees or
agents. 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. Neither the Company, GCA Altium nor WH Ireland are
making any undertaking or warranty to any Placee regarding the
legality of an investment in the Placing Shares by such Placee
under any legal, investment or similar laws or regulations. Each
Placee should not consider any information in this Announcement to
be legal, tax or business advice. Each Placee should consult its
own solicitor, tax adviser and financial adviser for independent
legal, tax and financial advice regarding an investment in the
Placing Shares. Nothing in this paragraph shall exclude the
liability of any person for fraudulent misrepresentation.
Registration and Settlement
Following the close of the Bookbuild, each Placee allocated
Placing Shares in the Placing will be sent a trade confirmation or
contract note in accordance with the standing arrangements in place
with WH Ireland, stating the number of Placing Shares allocated to
it at the Placing Price, the aggregate amount owed by such Placee
(in GBP) and a form of confirmation in relation to settlement
instructions.
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 WH Ireland in accordance with the standing CREST
settlement instructions which they have in place with WH
Ireland.
Settlement of transactions in the Placing Shares (ISIN:
GB0001112035) following Admission will take place within the system
administered by Euroclear UK & Ireland Limited ("CREST")
provided that, subject to certain exceptions, WH Ireland reserves
the right to require settlement for, and delivery of, the Placing
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 5 July 2017 in
accordance with the instructions set out in the form of
confirmation.
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 [two] percentage points above LIBOR.
Each Placee is deemed to agree that, if it does not comply with
these obligations, WH Ireland may sell any or all of the Placing
Shares allocated to that Placee on such Placee's behalf and retain
from the proceeds, for WH Ireland'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 and shall indemnify WH Ireland on demand 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 Placing Shares on such
Placee's behalf. By communicating a bid for Placing Shares, each
Placee confers on WH Ireland such authorities and powers necessary
to carry out any such sale and agrees to ratify and confirm all
actions which WH Ireland lawfully takes in pursuance of such
sale.
If Placing Shares are to be delivered to a custodian or
settlement agent, Placees should ensure that the form of
confirmation 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 UK stamp duty or stamp duty reserve tax
or securities transfer tax. Neither WH Ireland nor the Company will
be liable in any circumstances for the payment of stamp duty, stamp
duty reserve tax or securities transfer tax in connection with any
of the Placing Shares. Placees will not be entitled to receive any
fee or commission in connection with the Placing.
Representations, Warranties and Further Terms
By participating in the Placing, each Placee (and any person
acting on such Placee's behalf) makes the following
representations, warranties, acknowledgements, agreements and
undertakings (as the case may be) to WH Ireland and GCA Altium (for
themselves and on behalf of the Company):
1. that it has read and understood this Announcement, including
the Appendix, in its entirety and that its subscription for or
purchase of Placing Shares is subject to and based upon all the
terms, conditions, representations, warranties, acknowledgements,
agreements and undertakings and other information contained herein
and undertakes not to redistribute or duplicate this
Announcement;
2. that its obligations are irrevocable and legally binding and
shall not be capable of rescission or termination by it in any
circumstances;
3. that the exercise by WH Ireland or GCA Altium of any right or
discretion under the Placing Agreement shall be within the absolute
discretion of WH Ireland or GCA Altium, as applicable, and WH
Ireland or GCA Altium need have any reference to it and shall have
no liability to it whatsoever in connection with any decision to
exercise or not to exercise any such right and each Placee agrees
that it has no rights against WH Ireland, GCA Altium or the
Company, or any of their respective officers, directors or
employees, under the Placing Agreement pursuant to the Contracts
(Rights of Third Parties Act) 1999;
4. that these terms and conditions represent the whole and only
agreement between it, WH Ireland, GCA Altium and the Company in
relation to its participation in the Placing and supersedes any
previous agreement between any of such parties in relation to such
participation. Accordingly, each Placee, in accepting its
participation in the Placing, is not relying on any information or
representation or warranty in relation to the Company or any of its
subsidiaries or any of the Placing Shares other than as contained
in this Announcement and the Exchange Information. Each Placee
agrees that neither the Company, GCA Altium, WH Ireland nor any of
their respective officers, directors or employees will have any
liability for any such other information, representation or
warranty, express or implied;
5. that in the case of any Placing Shares acquired by it as a
financial intermediary, as that term is used in Article 3(2) of the
Prospectus Directive, (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
Member State of the European Economic Area which has implemented
the Prospectus Directive other than Qualified Investors or in
circumstances in which the prior consent of WH Ireland has been
given to the offer or resale; or (ii) where Placing Shares have
been acquired by it on behalf of persons in any member state of the
EEA other than Qualified Investors, the offer of those Placing
Shares to it is not treated under the Prospectus Directive as
having been made to such persons;
6. that neither it nor, as the case may be, its clients expect WH Ireland 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 WH Ireland are not acting for it or its clients, and that WH Ireland will not be responsible for providing the protections afforded to customers of WH Ireland or for providing advice in respect of the transactions described herein;
7. that it is: (i) unless otherwise agreed in writing with WH
Ireland, located outside the United States and is not a US person
as defined in Regulation S under the Securities Act ("Regulation
S") and is subscribing for and/or purchasing the Placing Shares
only in "offshore transactions" as defined in and pursuant to
Regulation S, and (ii) it is not subscribing for and/or purchasing
Placing Shares as a result of any "directed selling efforts" as
defined in Regulation S or by means of any form of "general
solicitation" or "general advertising" as such terms are defined in
Regulation D under the Securities Act;
8. that the Placing Shares have not been and will not be
registered under the Securities Act, or under the securities
legislation of, or with any securities regulatory authority of, any
state or other jurisdiction of the United States and that, subject
to certain exceptions, the Placing Shares may not be offered, sold,
pledged, resold, transferred, delivered or distributed into or
within the United States;
9. that, unless specifically agreed with WH Ireland, it is not
and was not acting on a non-discretionary basis for the account or
benefit of a person located within the United States at the time
the undertaking to subscribe for and/or purchase Placing Shares was
given and it is not acquiring Placing Shares with a view to the
offer, sale, resale, transfer, delivery or distribution, directly
or indirectly, of any Placing Shares into the United States and it
will not reoffer, resell, pledge or otherwise transfer the Placing
Shares except pursuant to an exemption from, or in a transaction
not subject to, the registration requirements of the Securities Act
and otherwise in accordance with any applicable securities laws of
any state or jurisdiction of the United States;
10. that it is not a national or resident of Canada, Australia,
South Africa or Japan or a corporation, partnership or other entity
organised under the laws of Canada, Australia, the Republic of
South Africa or Japan and that it will not offer, sell, renounce,
transfer or deliver, directly or indirectly, any of the Placing
Shares in Canada, Australia, the Republic of South Africa or Japan
or to or for the benefit of any person resident in Canada,
Australia, the Republic of South Africa or Japan and each Placee
acknowledges that the relevant exemptions are not being obtained
from the Securities Commission of any province of Canada, that no
document has been or will be lodged with, filed with or registered
by the Australian Securities and Investments Commission or Japanese
Ministry of Finance and that the Placing Shares are not being
offered for sale and may not be, directly or indirectly, offered,
sold, transferred or delivered in or into Canada, Australia, the
Republic South Africa or Japan;
11. that it does not have a registered address in, and is not a
citizen, resident or national of, any jurisdiction in which it is
unlawful to make or accept an offer of the Placing Shares and it is
not acting on a non-discretionary basis for any such person;
12. that it has not, directly or indirectly, distributed,
forwarded, transferred or otherwise transmitted, and will not,
directly or indirectly, distribute, forward, transfer or otherwise
transmit, any presentation or offering materials concerning the
Placing or the Placing Shares to any persons within the United
States or to any US persons (as that term is defined in Regulation
S);
13. that it is entitled to subscribe for and/or purchase Placing
Shares under the laws of all relevant jurisdictions which apply to
it and that it has fully observed such laws and obtained all
governmental and other consents which may be required thereunder or
otherwise and complied with all necessary formalities and that it
has not taken any action which will or may result in the Company,
GCA Altium or WH Ireland or any of their respective directors,
officers, employees or agents acting in breach of any regulatory or
legal requirements of any territory in connection with the Placing
or its acceptance;
14. that it has obtained all necessary consents and authorities
to enable it to give its commitment to subscribe for and/or
purchase the Placing Shares and to perform its subscription and/or
purchase obligations;
15. that where it is acquiring Placing Shares for one or more
managed accounts, it is authorised in writing by each managed
account: (a) to acquire the Placing Shares for each managed
account; (b) to make on its behalf the representations, warranties,
acknowledgements, undertakings and agreements in this appendix and
the announcement of which it forms part; and (c) to receive on its
behalf any investment letter relating to the Placing in the form
provided to it by WH Ireland;
16. that it is either: (a) a person of a kind described in
paragraph 5 of Article 19 (persons having professional experience
in matters relating to investments and who are investment
professionals) of the Order; or (b) a person of a kind described in
paragraph 2 of Article 49 (high net worth companies, unincorporated
associations, partnerships or trusts or their respective directors,
officers or employees) of the Order; or (c) a person to whom it is
otherwise lawful for this Announcement to be communicated and in
the case of (a) and (b) undertakes that it will acquire, hold,
manage or dispose of any Placing Shares that are allocated to it
for the purposes of its business;
17. that, unless otherwise agreed by WH Ireland, it is a
qualified investor (as defined in section 86(7) of the Financial
Services and Markets Act 2000, as amended ("FSMA"));
18. that, unless otherwise agreed by WH Ireland, 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;
19. it has only communicated or caused to be communicated and
will only communicate or cause to be communicated any invitation or
inducement to engage in investment activity (within the meaning of
section 21 of FSMA) relating to the Placing Shares in circumstances
in which section 21(1) of FSMA does not require approval of the
communication by an authorised person;
20. that any money held in an account with each of WH Ireland
(or its nominee) on its behalf and/or any person acting on its
behalf will not be treated as client money within the meaning of
the rules and regulations of the FCA. Each Placee further
acknowledges that the money will not be subject to the protections
conferred by the FCA's client money rules. As a consequence, this
money will not be segregated from WH Ireland's (or its nominee's)
money in accordance with such client money rules and will be used
by WH Ireland in the course of its own business and each Placee
will rank only as a general creditor of WH Ireland;
21. that 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;
22. that it is not, and it is not acting on behalf of, a person
falling within subsections (6), (7) or (8) of sections 67 or 70
respectively or subsections (2) and (3) of section 93 or subsection
(1) of section 96 of the Finance Act 1986;
23. that it is not relying on any representations or warranties
or agreements by the Company, GCA Altium, WH Ireland or by any of
their respective directors, employees or agents or any other person
except as set out in the express terms of this letter;
24. that it will not deal or cause or permit any other person to
deal in all or any of the Placing Shares which it is subscribing
for and/or purchasing under the Placing unless and until Admission
becomes effective;
25. that it appoints irrevocably any director of WH Ireland as
its agent for the purpose of executing and delivering to the
Company and/or its registrars any document on its behalf necessary
to enable it to be registered as the holder of the Placing
Shares;
26. that, as far as it is aware it is not acting in concert
(within the meaning given in The City Code on Takeovers and
Mergers) with any other person in relation to the Company;
27. that this Announcement does not constitute a securities
recommendation or financial product advice and that neither WH
Ireland, GCA Altium nor the Company has considered its particular
objectives, financial situation and needs;
28. that it is aware that it may be required to bear, and it,
and any accounts for which it may be acting, are able to bear, the
economic risk of, and is able to sustain, a complete loss in
connection with the Placing;
29. that it will indemnify and hold the Company, GCA Altium and
WH Ireland and their respective affiliates harmless from any and
all costs, claims, liabilities and expenses (including legal fees
and expenses) arising out of or in connection with any breach of
the representations, warranties, acknowledgements, agreements and
undertakings in this Appendix and further agrees that the Company,
GCA Altium and WH Ireland will rely on the truth and accuracy of
the confirmations, warranties, acknowledgements and undertakings
herein and, if any of the foregoing is or becomes no longer true or
accurate, the Placee shall promptly notify WH Ireland, GCA Altium
and the Company. All confirmations, warranties, acknowledgements
and undertakings given by the Placee, pursuant to this Announcement
(including this Appendix) are given to WH Ireland and GCA Altium
for themselves and on behalf of the Company and will survive
completion of the Placing and Admission;
30. that time shall be of the essence as regards obligations
pursuant to this Appendix;
31. that 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, GCA Altium or WH Ireland to provide any legal, tax or
other advice to it;
32. that all dates and times in this Announcement (including
this Appendix) may be subject to amendment and that WH Ireland
shall notify it of such amendments;
33. that (i) it has complied with its obligations under the
Criminal Justice Act 1993, Part VIII of FSMA and MAR, (ii) in
connection with money laundering and terrorist financing, it has
complied with its obligations under the Proceeds of Crime Act 2002
(as amended), the Terrorism Act 2000 (as amended), the Terrorism
Act 2006 and the Money Laundering Regulations 2007 and (iii) it is
not a person: (a) with whom transactions are prohibited under the
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; (b) named on the Consolidated List of Financial Sanctions
Targets maintained by HM Treasury of the United Kingdom; or (c)
subject to financial sanctions imposed pursuant to a regulation of
the European Union or a regulation adopted by the United Nations
(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, 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 WH Ireland such evidence, if any, as to the identity or location
or legal status of any person which WH Ireland may request from it
in connection with the Placing (for the purpose
of complying with such 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
WH Ireland on the basis that any failure by it to do so may result
in the number of Placing Shares that are to be subscribed for
and/or purchased by it or at its direction pursuant to the Placing
being reduced to such number, or to nil, as WH Ireland may decide
in its absolute discretion;
34. that it will not make any offer to the public of those
Placing Shares to be subscribed for and/or purchased by it for the
purposes of the Prospectus Rules made by the FCA pursuant to
Commission Regulation (EC) No. 809/2004;
35. that 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 and it does not have any
contract, understanding or arrangement with any person to sell,
pledge, transfer or grant a participation therein to such person or
any third person with respect of any Placing Shares; save that that
if it is a private client stockbroker or fund manager it confirms
that in purchasing the Placing Shares it is acting under the terms
of one or more discretionary mandates granted to it by private
clients and it is not acting on an execution only basis or under
specific instructions to purchase the Placing Shares for the
account of any third party.
36. that it acknowledges that these terms and conditions and any
agreements entered into by it pursuant to these terms and
conditions shall be governed by and construed in accordance with
the laws of England and Wales and it submits (on behalf of itself
and on behalf of any person on whose behalf it is acting) to the
exclusive jurisdiction of the English courts as regards any claim,
dispute or matter arising out of any such contract, except that
enforcement proceedings in respect of the obligation to make
payment for the Placing Shares (together with any interest
chargeable thereon) may be taken by the Company, GCA Altium or WH
Ireland 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;
37. that any documents sent to Placees will be sent at the
Placees' risk. They may be sent by post to such Placees at an
address notified to WH Ireland;
38. that neither WH Ireland nor GCA Altium owes fiduciary or
other duties to any Placee in respect of any representations,
warranties, undertakings or indemnities in the Placing
Agreement;
39. that WH Ireland or GCA Altium or any of their respective
affiliates may, at their absolute discretion, agree to become a
Placee in respect of some or all of the Placing Shares;
40. that no prospectus or offering document has been or will be
prepared in connection with the Placing and it has not received and
will not receive a prospectus or other offering document in
connection with the Placing or the Placing Shares; and
41. that it has neither received nor relied on any confidential
price sensitive information concerning the Company in accepting its
invitation to participate in the Placing.
The Company, GCA Altium, WH Ireland and their respective
affiliates will rely upon the truth and accuracy of each of the
foregoing representations, warranties, acknowledgements and
undertakings which are given to WH Ireland and GCA Altium for
itself and on behalf of the Company and are irrevocable.
The provisions of this Appendix may be waived, varied or
modified as regards specific Placees or on a general basis by WH
Ireland.
The agreement to settle a Placee's subscription and/or purchase
(and/or the subscription of a person for whom such Placee is
contracting as agent) free of stamp duty and stamp duty reserve tax
depends on the settlement relating only to a subscription by it
and/or such person direct from the Company for the Placing Shares
in question. Such agreement assumes that the Placing Shares are not
being subscribed for 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 relates to any other subsequent dealing in the Placing
Shares, stamp duty or stamp duty reserve tax may be payable, for
which neither the Company, GCA Altium or WH Ireland will be
responsible, and the Placee to whom (or on behalf 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 UK stamp duty or
stamp duty reserve tax undertakes to pay such UK stamp duty or
stamp duty reserve tax forthwith and to indemnify on an after-tax
basis and to hold harmless the Company, GCA Altium and WH Ireland
in the event that any of the Company, GCA Altium and/or WH Ireland
has incurred any such liability to UK stamp duty or stamp duty
reserve tax. If this is the case, each Placee should seek its own
advice and notify WH Ireland accordingly.
In addition, Placees should note that they will be liable for
any 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
UK by them or any other person on the subscription or purchase by
them of any Placing Shares or the agreement by them to subscribe
for or purchase any Placing Shares.
All times and dates in this Announcement (including this
Appendix) may be subject to amendment. WH Ireland shall notify the
Placees and any person acting on behalf of the Placees of any
changes.
This Announcement has been issued by, and is the sole
responsibility, of the Company. No representation or warranty
express or implied, is or will be made as to, or in relation to,
and no responsibility or liability is or will be accepted by WH
Ireland or GCA Altium or by any of their respective affiliates or
agents as to or in relation to, the accuracy or completeness of
this Announcement or any other written or oral information made
available to or publicly available to any interested party or its
advisers, and any liability therefore is expressly disclaimed.
DEFINITIONS
The following definitions apply throughout this Announcement
unless the context otherwise requires:
"Admission" the admission of the New Ordinary
Shares to trading on AIM becoming
effective in accordance with the
AIM Rules
"AIM Rules" the AIM Rules for Companies published
by the London Stock Exchange from
time to time
"AIM" the market of that name operated
by the London Stock Exchange
"Announcement" this announcement
"Articles" the articles of association of
the Company (as amended from time
to time)
"Business Day" any day on which banks are usually
open for business in England and
Wales for the transaction of sterling
business, other than a Saturday,
Sunday or public holiday
"Neville Registrars" a trading name of Neville Registrars
Limited
"certificated" an Existing Ordinary Share or
or "in certificated an Ordinary Share recorded on
form" the Company's share register as
being held in certificated form
(namely, not in CREST)
"Circular" the circular in relation to the
Transaction expected to be dispatched
to Shareholders today
"Closing Price" the closing middle market price
of an Existing Ordinary Share
as derived from the AIM Appendix
to the Daily Official List of
the London Stock Exchange
"Company" or "Redhall" Redhall Group plc
"Companies Act" the Companies Act 2006, as amended
"Conversion Shares" the 37,500,000 New Ordinary Shares
arising from the Debt Conversion
"CREST" the relevant system (as defined
in the CREST Regulations) in respect
of which Euroclear is the operator
(as defined in those regulations)
"Debt Conversion" the conversion of GBP3.75 million
of the LOIM Debt as consideration
for the issue of the Conversion
Shares at the Issue Price
"Debt Conversion the agreement between LOIM and
Agreement" the Company dated 14 June 2017
in relation to the Debt Conversion]
"Directors" or the directors of the Company or
"Board" any duly authorised committee thereof
"Enlarged Issued the Ordinary Shares in issue immediately
Share Capital" following Admission, comprising
the Ordinary Shares and the New
Ordinary Shares
"Existing Ordinary the 200,050,684 ordinary shares
Shares" or "Existing of 0.01 pence each in the capital
Issued Share Capital" of the Company in issue at the date
of this Announcement
"GCA Altium" GCA Altium Limited, nominated adviser
and financial adviser to the Company
"General Meeting" the general meeting of the Company
to be convened for 11.00 a.m. on
30 June 2017
"Group" or "Redhall the Company and its existing subsidiaries
Group" and subsidiary undertakings
"Independent Director" Phillip Hilling
"Issue Price" 10 pence per New Ordinary Share
"LOIM" Lombard Odier Asset Management (USA)
Corp for and on behalf of investment
funds and / or accounts for which
it acts as discretionary investment
manager
"LOIM Debt" the GBP5.74 million of debt owed
to LOIM by the Company as at 13
June 2017
"New Ordinary Shares" together the Placing Shares and
the Conversion Shares
"Notice" the notice of the General Meeting
to be set out in the Circular
"Ordinary Shares" ordinary shares of 0.01 pence each
in the capital of the Company
"Overseas Shareholders" holders of Existing Ordinary Shares
who are neither resident in, nor
have a registered address in, the
UK
"Placing" the proposed placing of the Placing
Shares by WH Ireland on behalf of
the Company at the Issue Price pursuant
to the Placing Agreement
"Placing Agreement" the agreement dated 14 June 2017
between the Company, WH Ireland
and GCA Altium relating to the Placing
"Placing Shares" up to approximately 95,000,000 new
Ordinary Shares to be issued pursuant
to the Placing
"Resolutions" the resolutions to be proposed at
the General Meeting, which are set
out in the Notice
"Regulatory Information one of the regulatory information
Service" services authorised by the FCA acting
in its capacity as the UK listing
authority to receive, process and
disseminate regulatory information
"Securities Act" the United States Securities Act
of 1933, as amended
"Shareholders" the holders of Existing Ordinary
Shares or Ordinary Shares (as the
context requires) at the relevant
time
"Transaction" together, the Placing and the Debt
Conversion
"United Kingdom" the United Kingdom of Great Britain
or "UK" and Northern Ireland
"United States" the United States of America, its
or "US" territories and possessions, any
state of the United States of America
and the District of Columbia and
any other area subject to its jurisdiction
"US Person" has the meaning set out in Regulation
S of the Securities Act
"WH Ireland" WH Ireland Limited, the Company's
broker
This information is provided by RNS
The company news service from the London Stock Exchange
END
IOESFWEFDFWSESM
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June 14, 2017 02:01 ET (06:01 GMT)
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