TIDMSENS
RNS Number : 0075M
Sensyne Health PLC
18 May 2022
SENSYNE HEALTH PLC
("Sensyne" or the "Company")
Publication of circular and notice of general meeting
Oxford, U.K. - 18 May 2022 : Sensyne Health plc (LSE:SENS)
announces that further to the announcement made on 19 April 2022
regarding the execution of an amendment and restatement to the note
purchase agreement with existing and new secured lenders (the "
Strategic Financing "), a circular (the " Circular ") has been
published on the Company's website,
www.sensynehealth.com/investors/investor-hub, and will shortly be
posted to Shareholders. The Circular contains the notice convening
the General Meeting to be held at 11.00 a.m. (UK time) on 6 June
2022 to consider certain Resolutions in connection with the
Strategic Financing (including the Rule 9 Waiver Resolution).
This Announcement also constitutes the notification of the
Company's intention to cancel the admission of its Ordinary Shares
from trading on AIM.
Unless otherwise indicated, capitalised terms in this
Announcement have the meaning given to them in the definitions
section included in Appendix II.
The Circular contains, amongst other things, a letter from the
Chairman of Sensyne (which is reproduced in full below), details of
the Strategic Financing, the effects of the AIM Delisting and the
Re-registration, additional information on the Concert Party, a
notice of General Meeting, an indicative timetable of principal
events (which is attached as Appendix I to this Announcement) and
action to be taken by Shareholders. Shareholders should read the
Circular carefully and in its entirety before making a decision
with respect to the Resolutions.
Action required and Recommendation
As further detailed in the Circular, full implementation of the
Strategic Financing requires the approval by Shareholders of the
Resolutions to be proposed at the General Meeting to be held at the
offices of Covington & Burling LLP, 22 Bishopsgate, London EC2N
4BQ at 11.00 a.m. (UK time) on 6 June 2022.
Shareholders are encouraged to read the Circular in full and
should note the recommendation from the Independent Directors to
vote in favour of all the Resolutions for the reasons set out in
paragraph 18 of the Circular - 'Recommendation'.
Rule 9 Waiver Resolution
The Strategic Financing is subject to the passing of the Rule 9
Waiver Resolution by the Independent Shareholders to approve the
waiver granted by the Takeover Panel of the obligation of the
Concert Party to make a general offer for the Company under Rule 9
of the Takeover Code, which would otherwise arise as a result of
the issue to the Concert Party of Ordinary Shares pursuant to the
Conversion and/ or the exercise of Warrants. Further details on the
Rule 9 Waiver Resolution, may be found below under paragraph 10 -
'Takeover Code and Rule 9 Waiver Resolution'.
Cancellation from AIM
Subject to the passing of the Resolutions, the admission of the
Company's Ordinary Shares will be cancelled from trading on AIM
with effect from 07.00 a.m. on 20 June 2022. Consequently,
Shareholders will no longer be able to buy and sell Ordinary Shares
on AIM after 17 June 2022 as there will be no trading facility
available to Shareholders after this date. Further details on the
Cancellation, including the reasons for seeking the cancellation
and other matters relevant to Shareholders in connection with the
cancellation, may be found below under paragraph 11 - 'AIM
Delisting'.
Extract of the Letter from the Chairman of Sensyne Health
plc
1. Introduction
On 26 January 2022, the Company entered into the Original Note
Purchase Agreement with Gatemore Special Opportunities Master Fund,
Lansdowne, Sand Grove and Peel Hunt (solely by virtue of Peel Hunt
receiving the majority of its fee in Loan Notes) to secure GBP6.35
million principal amount of Original Notes and an additional GBP5.0
million principal amount of Loan Notes to be purchased by mutual
consent of the Original Purchasers and the Company. The combined
proceeds of GBP11.35 million were expected to secure the Company's
short-term financing requirements and fund the business through the
Formal Sale Process which was initiated on 2 November 2021.
In the absence of any offer (including for strategic investment)
under the FSP, on 8 April 2022, the Company announced that it had
entered into a non-binding term sheet with Gatemore Special
Opportunities Master Fund and Lansdowne to amend the Original Note
Purchase Agreement to provide additional capital through the issue
of additional Loan Notes. The Company also announced that the
founder and former Chief Executive Officer of the Company, Rt. Hon.
Lord Paul Drayson, had agreed to step down from the Board with
immediate effect and that the Board had agreed to appoint Mr. Alex
Snow as Chief Executive Officer upon entry into the Amended and
Restated Note Purchase Agreement.
On 19 April 2022, the Company announced that it had amended and
restated the Original Note Purchase Agreement for the purchase of,
in aggregate, GBP26.35 million principal amount of Loan Notes
(being the existing GBP6.35 million principal amount of Original
Notes and up to an additional GBP20 million principal amount of
Additional Notes) . The Amended and Restated Note Purchase
Agreement sets out, among other things, the resolutions that need
to be passed by Shareholders in connection with the Strategic
Financing, including, approval of the cancellation of admission of
the Ordinary Shares to trading on AIM. On 22 April 2022, the
Company received GBP6.0 million from the purchase of Additional A
Notes by Gatemore Investment Partners I LP, Lansdowne and Hambro
Perks Nominee.
Shareholder approval is being sought for the passing of the
Resolutions at the General Meeting in connection with the Strategic
Financing. The purpose of the Circular is to explain the background
to, and the reasons for, the Strategic Financing and why the
Directors believe that the Strategic Financing is in the best
interests of the Company and its Shareholders as a whole, and to
recommend that you vote in favour of the Resolutions.
If the Conversion Conditions (including the passing of
Resolutions 1 to 7 in the Notice of General Meeting included in the
Circular) are not satisfied by 9 July 2022, the Relevant Purchasers
have the right to exercise the Asset Purchase Option. Upon exercise
of the Asset Purchase Option, the Company will be required to
transfer all of the material assets of the Group (including the
Strategic Research Agreements and other data collaboration
agreements) to Sensyne Holdings UK and transfer to the Relevant
Purchasers the entire issued share capital of Sensyne Holdings UK
for consideration of (i) the sum of GBP1 and (ii) the assumption by
the Relevant Purchasers of all the Company's outstanding
obligations in respect of the Loan Notes .
In the event that the Resolutions are not passed and the Asset
Purchase Option is exercised, this will result in a fundamental
change of the Company's business requiring approval of the
Company's Shareholders by passing an ordinary resolution in a
general meeting in accordance with the AIM Rules for Companies.
2. Background to and reasons for the Strategic Financing
On 2 November 2021, the Company announced the launch of a
strategic review and commencement of a formal sale process. As part
of this process, JP Morgan and Peel Hunt, as the Company's joint
financial advisers, contacted more than 100 corporates and
financial sponsors to solicit interest in an offer for the Company
or strategic investment into the Company. Possible offerors were
provided with access to due diligence materials and focused
sessions with company management and employees under the terms of
non-disclosure agreements. On 8 April 2022, the Company announced
that a small number of parties were having discussions with the
Company who may or may not make an offer for the Company or some
other strategic investment in or transaction with the Company.
Whilst a number of parties conducted significant due diligence over
the course of the FSP, no indicative offer proposals were
received.
As part of the Formal Sale Process, the Company was seeking
funding from a number of different sources. Due to the pressing
need for additional capital to maintain the Company's operations
and solvency position and in the absence of any alternatives, the
Company announced on 8 April 2022 that it had entered into a
non-binding term sheet with Gatemore Special Opportunities Master
Fund and Lansdowne to implement the Strategic Financing and amend
the Original Note Purchase Agreement. This was to provide
additional capital through the issue of additional Loan Notes to
fund the costs associated with maintaining the Company's operations
in order to enable the formulation and execution of a restructuring
and financing plan as part of the Strategic Financing.
On 19 April 2022, the Company announced that the Company and the
Note Purchasers entered into the Amended and Restated Note Purchase
Agreement for the purchase of, in aggregate, GBP26.35 million
principal amount of Loan Notes (being GBP6.35 million and up to an
additional GBP20 million principal amount of Original Notes and
Additional Notes, respectively) . The terms of the Amended and
Restated Note Purchase Agreement set out the Strategic Financing,
which, among other things, provided for the immediate appointment
of Mr. Alex Snow as Chief Executive Officer and proposed the
cancellation of admission of the Ordinary Shares to trading on AIM.
The Company also announced that, in light of the Strategic
Financing, the Board had decided to end the Formal Sale Process and
to terminate all ongoing discussions.
Without the proceeds from the Additional A Notes, the Company
would have become insolvent and been placed into administration in
April 2022.
Over the course of the coming months, the Board, with the
support of the Noteholders, expects Alex Snow to effect a
restructuring and refocusing of the business on its core real world
patient data business unit, and work in partnership with the NHS
and the life sciences community to develop and discover new
medicines and improve patient outcomes through the analysis of
anonymised real world patient data.
The Noteholders have committed to take reasonable steps to
exercise their rights under the Amended and Restated Note Purchase
Agreement in a manner that:
o continues the Company's ethical use of patient data;
o is consistent with the Company's goal of enabling the Company
to realise its mission to become the leader in the ethical
application of clinical AI to health data, to improve patient care
and accelerate medical research; and
o allows for a sustainable commercial model to be put in place
with the NHS Trusts that reflects the value of patient data
supplied to the Company by the NHS Trusts.
3. Current trading and outlook
The Company published its unaudited interim results for the six
month period ended 31 October 2021 on 31 January 2022. The
unaudited revenue figure for the period was GBP1.0 million and the
unaudited adjusted operating loss for the same period was GBP14.7
million.
The unaudited revenue for the year ended 30 April 2022 was
approximately GBP2.0 million. The Company's unaudited cash position
prior to the receipt of Additional A Notes on 22 April 2022 was
GBP1.2 million. As of 12 May 2022, the Company's unaudited cash
position was GBP5.0 million.
The Company has initiated an immediate restructuring of the
business to reduce costs and refocus the business on its core real
world patient data business and partnership with the NHS and life
sciences community. This restructuring is expected to result in a
significant reduction in the size of the workforce and the disposal
of parts of the business as described below. Whilst the Company has
signed one contract and expects to sign a number of other small
contracts with major pharmaceutical companies this year, the
contract values are modest and the prospect of more and larger
contracts continues to remain very uncertain.
4. Restructuring and Refocusing of the Company
Sensyne is a clinical artificial intelligence company operating
a unique business model - a for-profit plc making a positive social
impact, sharing the financial returns it makes with the health
systems that provide the Company with access to anonymised patient
data. The Company applies clinical AI in the healthcare and life
science industries. In healthcare, Sensyne delivers remote patient
monitoring and real-time decision-making systems for healthcare
organisations and their patients. In life sciences, Sensyne
analyses large complex anonymised data sets to help life sciences
companies accelerate the development of new medicines.
The Company's cost base (GBP21.5 million unaudited operating
loss for the six months ended 31 October 2021), which largely
consists of costs associated with employing approximately 144
employees (117 net of resignations as at 13 May 2022), far exceeds
revenues (GBP1.0 million for the same period) and is unsustainable
without access to significant additional capital.
In the absence of any offers under the FSP or alternative
sources of working capital including from strategic investors or
generation of substantial commercial revenues, the Company entered
into the Amended and Restated Note Purchase Agreement to access
additional capital from the Noteholders. Under the terms of this
agreement, the Company has appointed Alex Snow as CEO to effect a
restructuring and refocusing of the business on its core real world
patient data business unit which will result in a streamlined
business with a much reduced cost base. This restructuring exercise
started in late April 2022 and is expected to be largely completed
by the end of August 2022.
The restructuring will require significant headcount reductions
in the Company's R&D operations as the business seeks only to
retain the skills and expertise necessary to support its focus on
real world patient data. Furthermore, the restructuring will
include the disposal of, closure of and/or cessation of R&D
expenditure on certain parts of the business not related to the
life sciences-focused future of the business. This will include the
healthcare product division including the Company's digital health
applications as these are not viewed as being core to the future
operations of the Company. The Company's central, financial and
administrative functions are also expected to be substantially
reduced to align the balance of skills and functions of the same in
a refocused business that is no longer quoted on AIM. The Company
will also focus its activities on the UK to support its partnership
with the NHS and, consequently, its activities elsewhere,
particularly the US, will be supported from the UK.
The Directors believe that the Strategic Financing is in the
best interest of the employees and management of Sensyne as it will
ensure Sensyne will have the resources available to drive
development and commercialisation of its core real world patient
data business unit. The resources provided by the Strategic
Financing should allow the Company to complete the restructuring
and, ultimately, provide its remaining employees opportunities in a
refocused business at the forefront of real world patient data and
AI.
The Company has relocated to a smaller headquarter facility
within Oxford, UK to reduce costs. Related to this relocation,
Sensyne Group UK recently assigned its interests in three leasehold
interests at the Schrödinger Building, The Oxford Science Park,
Oxford to ExScientia AI Limited on 25 March 2022.
5. Intention Statements
None of Gatemore, Lansdowne, Sand Grove, Hambro Perks and Alex
Snow intend to make a general offer for the Company. The long-term
justification for the Strategic Financing is to implement the
restructuring and refocusing plan as described in paragraph 4 -
'Restructuring and Refocusing of the Company'. The Concert Party
has confirmed to the Company that it is not proposing, following
the increase in the percentage interest in Ordinary Shares as a
result of the Conversion and the exercise of Warrants, to seek any
changes to the business beyond those described under paragraph 4 -
'Restructuring and Refocusing of the Company'. Whilst the
composition of the Board is expected to remain unchanged for the
period up to the AIM Delisting taking effect, it is expected that
the Board will undergo a restructuring to reduce costs and align
skills and experience with those required of an unquoted
company.
The restructuring will require significant headcount reductions
in the Company's R&D operations as the business seeks only to
retain the skills and expertise necessary to support its focus on
real world patient data. Furthermore, the restructuring will
include the disposal of, closure of and/or cessation of R&D
expenditure on certain parts of the business not related to the
life sciences-focused future of the business. This will include the
healthcare product division including the Company's digital health
applications as these are not viewed as being core to the future
operations of the Company. The Company's central, financial and
administrative functions are also expected to be substantially
reduced to align the balance of skills and functions of the same in
a refocused business that is no longer quoted on AIM. The Company
will also focus its activities on the UK to support its partnership
with the NHS and, consequently, its activities elsewhere,
particularly the US, will be supported from the UK.
The Concert Party has also confirmed that it has no intention to
make any changes in relation to:
-- the location of the Company's places of business and
headquarters (the Company will focus its operations on the UK and
retain its headquarters in the UK);
-- employer contributions into the Company's pension schemes,
the accrual of benefits for existing members and the admission of
new members; and
-- any redeployment of the fixed assets of the Company.
The participation in the Strategic Financing by Gatemore is in
the ordinary course of Gatemore's business and is not expected to
have any material effect on its future business or any material
financial impact on its earnings, assets or liabilities.
The participation in the Strategic Financing by Lansdowne is in
the ordinary course of Lansdowne's business and is not expected to
have any material effect on its future business or any material
financial impact on its earnings, assets or liabilities.
The participation in the Strategic Financing by Sand Grove is in
the ordinary course of Sand Grove's business and is not expected to
have any material effect on its future business or any material
financial impact on its earnings, assets or liabilities.
The participation in the Strategic Financing by HPL is in the
ordinary course of HPL's business and is not expected to have any
material effect on its future business or any material financial
impact on its earnings, assets or liabilities.
Beyond the ability to participate in future tranches of the Loan
Notes, the Concert Party has not entered into and has not had
discussions on proposals to enter into any incentivisation
arrangements with members of the Company's management.
The Ordinary Shares are currently admitted to trading on AIM. As
set out in paragraph 11 - 'AIM Delisting' , shortly after
completion of the Strategic Financing, the Company intends to
cancel its admission to trading on AIM.
6. Details of the Strategic Financing
Loan Notes
On 18 April 2022, the Company entered into the Amended and
Restated Note Purchase Agreement pursuant to which the Purchasers
(as such term is defined in the Amended and Restated Note Purchase
Agreement) agreed to purchase Loan Notes with principal amount of
up to GBP26,350,000 in the following tranches:
(a) the Original Notes, being a tranche of GBP6,350,000
principal amount of Loan Notes. The Original Notes were issued to
the Original Purchasers on 28 January 2022;
(b) the Additional A Notes, being a tranche of GBP6,000,000
principal amount of Loan Notes. The Additional A Notes were issued
to the Additional A Note Purchasers on 21 April 2022; and
(c) two subsequent tranches of Loan Notes, the Additional B
Notes and th e Additional C Notes, which may each be issued in any
principal amount provided that the total aggregate amount of
Additional Notes does not exceed GBP20,000,000. The Additional B
Notes and the Additional C Notes shall be issued at the request of
the Company and shall be allocated as follows:
(i) Alex Snow may subscribe for up to GBP2,000,000 of the
Additional B Notes and the Additional C Notes (in aggregate across
both tranches);
(ii) subject to paragraph (i) above, the Relevant Purchasers may
subscribe for their pro rata proportion of the Additional B Notes
and/or the Additional C Notes. To the extent that any Relevant
Purchaser does not exercise its right in full to subscribe for
Additional B Notes or Additional C Notes, its remaining pro rata
share may be taken up by the other Relevant Purchasers; and
(iii) if the amount of Additional B Notes or Additional C Notes
subscribed for by Alex Snow and each Relevant Purchaser as
described above is less than the aggregate issuance amount of the
Additional B Notes or the Additional C Notes, the Company may offer
the unallocated balance of the Additional B Notes or Additional C
Notes to any third party, save that in the case of any issuance of
Additional C Notes, such offer of Additional C Notes to third
parties is subject to the unanimous consent of the Additional A
Note Purchasers.
A portion of the principal amount of the Additional A Notes
(such portion as would result upon Conversion in the Note
Purchasers collectively holding 29.9 per cent. of the issued share
capital of the Company, including any existing shareholdings,
Warrants and accounting for the cashless exercise of the Warrants)
have unconditional rights to convert into Ordinary Shares at the
Conversion Price.
The balance of the Loan Notes have conditional rights to convert
into Ordinary Shares at a conversion price of GBP0.008 per Ordinary
Share (being the resulting nominal value of the Ordinary Shares
following the Sub-division), subject to and conditional upon the
satisfaction of the Conversion Conditions, being the passing of the
Resolutions by the Shareholders and the grant of the Rule 9 Waiver
by the Takeover Panel.
The Loan Notes are redeemable at 1.25 times their par value. The
Loan Notes have a maturity date of 26 January 2023, which is the
date falling 364 days following the date of issuance of the
Original Notes. The Loan Notes are redeemable (i) on the maturity
date, and (ii) at the election of the Noteholders, on a pro rata
basis, in an amount equal to any cumulative net proceeds the
Company receives following the completion of any share issuance by
the Company or a member of the Group (other than to another member
of the Group, or as a result of the exercise of the Warrants, or
pursuant to the Conversion), material asset sale by the Company or
a member of the Group or a recapitalisation of the Company or a
member of the Group exceeding GBP2 million. The Loan Notes may be
redeemed by the Company on a voluntary basis (i) by giving not less
than ten Business Days' notice, and (ii) at the request of a
Noteholder (in respect of its Loan Notes) upon the earliest of the
sale of all or substantially all of the assets of the Group or a
Change of Control (as defined in the Amended and Restated Note
Purchase Agreement) of the Company.
The proceeds of the issue of the Additional Notes may only be
used for costs associated with maintaining the Company's operations
in order to enable the formulation and execution of a restructuring
and financing plan.
The Company issued the Original Notes to the Original Purchasers
and received cash proceeds of GBP5,950,000 on 28 January 2022. The
Company issued the Additional A Notes to the Additional A Note
Purchasers and received cash proceeds of GBP6,000,000 on 22 April
2022.
Security
The Loan Notes represent senior ranking obligations of the
Company and are secured on a first and second priority basis and
guaranteed and secured by certain members of the Group. The
security consists of, amongst others, first and second ranking
fixed and floating security over substantially all of the assets
(subject to certain agreed exceptions) of those members of the
Group.
Warrants
Under the terms of the Amended and Restated Note Purchase
Agreement, the Company also agreed to issue to the Note Purchasers
Warrants to subscribe for up to 29,169,448 Ordinary Shares
(representing approximately 17.52 per cent. of the Company's issued
share capital as at the Last Practicable Date) as follows:
(a) Warrants to subscribe for 8,239,950 Ordinary Shares
(representing approximately 4.95 per cent. of the Company's issued
share capital as at the Last Practicable Date), which were issued
pro rata to the Original Purchasers on issue of the Original
Notes;
(b) Warrants to subscribe for 12,689,541 Ordinary Shares
(representing approximately 7.62 per cent. of the Company's issued
share capital as at the Last Practicable Date), which were issued
pro rata to the Original Purchasers in connection with the Original
Notes, subject to certain conditions as set out in the Amended and
Restated Note Purchase Agreement; and
(c) Warrants to subscribe for 8,239,957 Ordinary Shares
(representing approximately 4.95 per cent. of the Company's issued
share capital as at the Last Practicable Date), which were issued
pro rata to the Additional A Note Purchasers on issue of the
Additional A Notes.
Each Warrant is exercisable at the Warrant Exercise Price at any
time from the date of issue of the Warrant until 5.00 p.m. on 15
January 2025. The Warrants are subject to the terms of the Amended
and Restated Warrant Instrument, further details of which are set
out in Section B of Part II (Details of the Strategic Financing) of
the Circular.
As at the date of this Announcement, the Company has issued all
of the Warrants to subscribe for all 29,169,448 Ordinary Shares to
the Note Purchasers. The Warrants were issued utilising the
authorities and powers approved by Shareholders at the Company's
2021 AGM and at the Last General Meeting. However, pursuant to the
terms of the Amended and Restated Warrant Instrument and the
Amended and Restated Note Purchase Agreement, the Warrant Exercise
Price will, subject to and conditional upon completion of the
Sub-division, be reduced from GBP0.10 per Ordinary Share to
GBP0.008 per Ordinary Share. Accordingly, the subscription rights
attaching to the Warrants have changed and the Directors are
therefore re-seeking the ratification and approval of the
Shareholders to issue the Warrants pursuant to the terms of the
Amended and Restated Warrant Instrument and to dis-apply the
statutory pre-emption rights in connection with such issue.
Board Observer Right
Sand Grove have appointed Fadi Chamsy as an observer to the
Board pursuant to their existing right under the Original Note
Purchase Agreement.
The Additional Note Purchasers have appointed William Grant of
Gatemore as an observer to the Board pursuant to their right under
the Amended and Restated Note Purchase Agreement.
7. Sub-division of Ordinary Shares
The Company is required under the terms of the Amended and
Restated Note Purchase Agreement to seek Shareholder approval for
the Sub-division, which requires an ordinary resolution to be
passed.
Pursuant to the terms of the Amended and Restated Note Purchase
Agreement, the Directors are seeking the approval of the
Shareholders to effect the Sub-division, such that each of the
166,464,335 ordinary shares of GBP0.10 each in the capital of the
Company will be sub-divided and re-designated into one ordinary
share of GBP0.008 each in the capital of the Company and one
deferred share of GBP0.092 each in the capital of the Company (the
"New Ordinary Shares"), having the rights and being subject to the
restrictions set out in the Revised Articles. Following completion
of the Sub-division, the Loan Notes will have rights to convert
into Ordinary Shares at a conversion price of GBP0.008 per Ordinary
Share and the Warrants will be exercisable at a Warrant Exercise
Price of GBP0.008 per Ordinary Share (being the resulting nominal
value of the Ordinary Shares following the Sub-division).
No new share certificates will be issued in respect of the New
Ordinary Shares as existing share certificates will remain valid in
respect of the same number of New Ordinary Shares arising from the
Sub-division. The number of ordinary shares of the Company will not
change as a result of the Sub-division.
8. Asset Purchase Option
If the Conversion Conditions (including the passing of the
Resolutions) are not satisfied in full or waived by 9 July 2022,
the Relevant Purchasers will have the right to exercise (at their
sole election (acting together)) the Asset Purchase Option. Upon
exercise of the Asset Purchase Option, the Company will be required
to transfer all of the material assets of the Group (including the
Strategic Research Agreements and other data collaboration
agreements) to Sensyne Holdings UK and transfer to the Relevant
Purchasers the entire issued share capital of Sensyne Holdings UK
for consideration of (i) the sum of GBP1 and (ii) the assumption by
the Relevant Purchasers of all the Company's outstanding
obligations in respect of the Loan Notes.
The implementation of the Asset Purchase Option will constitute
a fundamental change of business within the meaning of Rule 15 of
the AIM Rules for Companies. Accordingly, if exercised, the Asset
Purchase Option will be conditional upon the passing of an ordinary
resolution of the Shareholders in accordance with Rule 15 of the
AIM Rules for Companies at a subsequent general meeting of the
Company. The Company has received irrevocable undertakings in
respect of 48,572,586 Ordinary Shares ( representing approximately
29.18 per cent. of the Company's issued share capital as at the
Last Practicable Date) to vote in favour of any resolution to
approve the Asset Purchase Option. Additionally, the Relevant
Purchasers, who have undertaken in the Amended and Restated Note
Purchase Agreement to vote in favour of any resolution to approve
the Asset Purchase Option, hold 23,328,875 Ordinary Shares
(representing approximately 14.01 per cent. of the Company's issued
share capital as at the Last Practicable Date). The Relevant
Purchasers can exercise the Warrants at their discretion and will
therefore be able to secure the passing of any resolution to
approve the Asset Purchase Option if the Conversion Conditions are
not satisfied in accordance with the terms of the Amended and
Restated Note Purchase Agreement.
9. General Meeting
The General Meeting of the Company, notice of which is set out
at the end of the Circular, is to be held at the offices of
Covington & Burling LLP, 22 Bishopsgate, London EC2N 4BQ at
11.00 a.m. on 6 June 2022. The General Meeting is being held for
the purpose of considering and, if thought fit, passing the
following resolutions:
Resolution 1 - an ordinary resolution to grant authority to
sub-divide and re-designate each existing ordinary share of GBP0.10
in the capital of the Company into one new ordinary share of
GBP0.008 and one deferred share of GBP0.092 in the capital of the
Company.
Resolution 2 - a special resolution to approve the amendment of
the Articles to include the rights of the Deferred Shares following
the Sub-division and as set out in the Revised Articles.
Resolution 3 - an ordinary resolution to authorise the Directors
to grant rights to convert the Loan Notes into Ordinary Shares at a
conversion price of GBP0.008 per ordinary share up to an aggregate
nominal amount of GBP26,350,000.
Resolution 4 - a special resolution to empower the Directors to
dis-apply statutory pre-emption rights in respect of the grant of
rights to convert the Loan Notes into Ordinary Shares, provided
that such power shall be limited to an aggregate nominal amount of
GBP26,350,000.
Resolution 5 - an ordinary resolution to authorise the Directors
to issue the Warrants to subscribe for up to 29,169,448 ordinary
shares of GBP0.008 each.
Resolution 6 - a special resolution to empower the Directors to
dis-apply statutory pre-emption rights in respect of the issue of
the Warrants described in resolution 5 above.
Resolution 7 - an ordinary resolution of the Independent
Shareholders to approve the waiver granted by the Takeover Panel
under Rule 9 which would otherwise apply to the Concert Party (or
such other persons as determined by the Takeover Panel) as a result
of the issue to them of Ordinary Shares pursuant to the Conversion
and/or the exercise of the Warrants.
Resolution 8 - a special resolution, in accordance with Rule 41
of the AIM Rules for Companies, for the cancellation of the
admission to trading on AIM of the Ordinary Shares.
Resolution 9 - a special resolution that the Company be
re-registered as a private company.
Resolution 10 - a special resolution to adopt the New Articles
upon the Re-registration, in substitution for, and to the exclusion
of, the existing articles of association (which at that time will
be the Revised Articles) to reflect the Company's Delisting and
status as a private limited company.
Please note that this is not the full text of the Resolutions
and you should read this section in conjunction with the
Resolutions contained in the Notice of General Meeting in Part IV
(Notice of General Meeting) of the Circular. You should also note
that certain of the Resolutions are conditional upon the passing of
other Resolutions.
10. Takeover Code and Rule 9 Waiver Resolution
The Strategic Financing gives rise to certain considerations
under the Takeover Code. The Takeover Code is issued and
administered by the Takeover Panel. The Takeover Code applies to
all offers for companies which have their registered offices in the
United Kingdom, the Channel Islands or the Isle of Man if any of
their equity share capital or other transferable securities
carrying voting rights are admitted to trading on a UK regulated
market or a UK multilateral trading facility or on any stock
exchange in the Channel Islands or the Isle of Man. The Takeover
Code also applies to all offers for companies (both public and
private) which have their registered offices in the United Kingdom,
the Channel Islands or the Isle of Man which are considered by the
Takeover Panel to have their place of central management and
control in the United Kingdom, the Channel Islands or the Isle of
Man, but in relation to private companies only if one of a number
of conditions is met - for example, if the company's shares were
admitted to trading on a UK regulated market or a UK multilateral
trading facility or on any stock exchange in the Channel Islands or
the Isle of Man at any time in the preceding ten years.
(a) Application of the Takeover Code
The Takeover Code applies to the Company. Under Rule 9 of the
Takeover Code, any person who acquires, whether by a series of
transactions over a period of time or not, an interest in shares
(as defined in the Takeover Code) which when taken together with
shares already held by him/her or held or acquired by persons
acting in concert with him/her, carry 30 per cent. or more of the
voting rights of a company which is subject to the Takeover Code is
normally required to make an offer to all the remaining
shareholders to acquire their shares.
Similarly, when any person, together with persons acting in
concert with that person, is interested in shares which in the
aggregate carry not less than 30 per cent. of the voting rights of
such a company but does not hold shares carrying more than 50 per
cent. of the voting rights of the company, an offer will normally
be required if any further interests in shares carrying voting
rights are acquired by such person or any person acting in concert
with that person.
An offer under Rule 9 must be made in cash at the highest price
paid by the person required to make the offer, or any person acting
in concert with such person, for any interest in shares of the
company during the 12 months prior to the announcement of the
offer.
Accordingly, pursuant to Rule 9 of the Takeover Code, if the
Board were to allot and issue Ordinary Shares to the Noteholders
upon Conversion and/or issue upon the exercise of Warrants,
resulting in an increase to the percentage of the voting rights
which the Concert Party controls; the Concert Party may be required
to make a general cash offer to all other Shareholders of the
Company to acquire their Ordinary Shares, unless such obligation
has been waived by the Takeover Panel.
Part III (Additional Information) of the Circular sets out
certain further information and financial information respectively
that is required to be disclosed in the Circular pursuant to the
rules contained in the Takeover Code.
(b) Information on the Concert Party
The Company has agreed with the Takeover Panel that each of the
entities listed in the table below are acting in concert in
relation to the Company (together the "Concert Party"). As at the
Last Practicable Date, members of the Concert Party have an
interest in the Ordinary Shares equating to an aggregate of 20.64
per cent. of the issued share capital of the Company.
Percentage
Number of of the issued
Ordinary Shares share capital
Name held of the Company
Gatemore Capital Management LLP nil 0%
Gatemore Special Opportunities Master
Fund 9,892,099 5.94%
Gatemore Investment Partners I LP nil 0%
Lansdowne Partners (UK) LLP nil 0%
Lansdowne Developed Markets Master
Fund Limited 12,952,838 7.78%
Lansdowne Developed Markets Strategic
Investment Master Fund Limited 483,948 0.29%
Sand Grove Capital Management LLP nil 0%
Sand Grove Opportunities Master Fund
Ltd. 11,024,633 6.62%
Sand Grove Tactical Fund LP nil 0%
Hambro Perks Limited nil 0%
MNL (Hambro Perks) Nominees Limited nil 0%
Alex Snow nil 0%
--------------------------------------- ----------------- ----------------
Total 34,353,518 20.64%
Further information on the Concert Party is set out in Part III
(Additional Information) of the Circular.
(c) Details of the maximum controlling position
(i) Conversion of the Original Notes and the Additional A Notes
and exercise of the Warrants
Assuming that the members of the Concert Party will, at the
earliest opportunity (which would be following the passing of the
Resolutions at the General Meeting to be held on 6 June 2022),
convert in full the Original Notes and the Additional A Notes and
exercise in full the Warrants (and assuming that no other person
converts any convertible securities or exercises any options or any
other right to subscribe for shares in the Company), the members of
the Concert Party would be interested in 1,540,588,471 shares,
representing approximately 89.40% of the enlarged voting rights of
the Company. A table showing the respective individual interests in
shares of the members of the Concert Party following the Conversion
of the Original Notes and the Additional A Notes and the exercise
of the Warrants is set out below:
Percentage of
Number of the voting share
Ordinary Shares capital of the
Name held Company
Gatemore Capital Management LLP nil 0%
Gatemore Special Opportunities Master
Fund 136,369,607 7.91%
Gatemore Investment Partners I LP 125,615,628 7.29%
Lansdowne Partners (UK) LLP nil 0%
Lansdowne Developed Markets Master
Fund Limited 474,603,545 27.54%
Lansdowne Developed Markets Strategic
Investment Master Fund Limited 17,724,015 1.03%
Sand Grove Capital Management LLP nil 0%
Sand Grove Opportunities Master
Fund Ltd. 365,161,661 21.19%
Sand Grove Tactical Fund LP 44,267,128 2.57%
Hambro Perks Limited nil 0%
MNL (Hambro Perks) Nominees Limited 376,846,887 21.87%
Alex Snow nil 0%
--------------------------------------- ----------------- ------------------
Total 1,540,588,471 89.40%
Following Conversion of the Original Notes and the Additional A
Notes in full, the Concert Party would hold Ordinary Shares
carrying over 50 per cent. of the voting rights of the Company and
(for so long as they continue to be acting in concert) may
accordingly increase their aggregate interests in shares without
incurring any obligation to make an offer under Rule 9, although
individual members of the Concert Party will not be able to
increase their percentage interests in shares through or between a
Rule 9 threshold without Takeover Panel consent.
(ii) Conversion of the Original Notes and the Additional Notes
and exercise of the Warrants
The allocation of the Additional B Notes and the Additional C
Notes is not yet determined. For illustrative purposes only, the
Company has assumed that Alex Snow will subscribe for the entire
GBP2 million in principal amount of loan notes for which he is
entitled to subscribe and that the other members of the Concert
Party shall subscribe pro rata in accordance with the Amended and
Restated Note Purchase Agreement. Based on this illustrative model
and assuming that the members of the Concert Party will, at the
earliest opportunity (which would be following the passing of the
Resolutions at the General Meeting to be held on 6 June 2022),
convert in full the Original Notes and the Additional Notes and
exercise in full the Warrants (and assuming that no other person
converts any convertible securities or exercises any options or any
other right to subscribe for shares in the Company), the members of
the Concert Party would be interested in 3,290,588,468 shares,
representing approximately 94.74% of the enlarged voting rights of
the Company. A table showing the respective individual interests in
shares of the members of the Concert Party following the Conversion
of the Original Notes and the Additional Notes and the exercise of
the Warrants is set out below:
Percentage of
Number of the voting share
Ordinary Shares capital of the
Name held Company
Gatemore Capital Management LLP nil 0%
Gatemore Special Opportunities Master
Fund 261,892,619 7.54%
Gatemore Investment Partners I LP 251,138,640 7.23%
Lansdowne Partners (UK) LLP nil 0%
Lansdowne Developed Markets Master
Fund Limited 934,419,444 26.90%
Lansdowne Developed Markets Strategic
Investment Master Fund Limited 34,895,563 1.00%
Sand Grove Capital Management LLP nil 0%
Sand Grove Opportunities Master
Fund Ltd. 716,626,096 20.63%
Sand Grove Tactical Fund LP 88,200,182 2.54%
Hambro Perks Limited nil 0%
MNL (Hambro Perks) Nominees Limited 753,415,924 21.69%
Alex Snow 250,000,000 7.20%
--------------------------------------- ----------------- ------------------
Total 3,290,588,468 94.74%
Following Conversion of the Original Notes and the Additional
Notes in full and following the exercise of the Warrants in full,
the Concert Party would hold Ordinary Shares carrying over 50 per
cent. of the voting rights of the Company and (for so long as they
continue to be acting in concert) may accordingly increase their
aggregate interests in shares without incurring any obligation to
make an offer under Rule 9, although individual members of the
Concert Party will not be able to increase their percentage
interests in shares through or between a Rule 9 threshold without
Takeover Panel consent.
(d) Rule 9 Waiver and the Rule 9 Waiver Resolution
The Conversion and the exercise of the Warrants would normally
trigger an obligation for an offer to be made under Rule 9.
However, in order to enable the Company to effect the Strategic
Financing without triggering a mandatory offer obligation for the
Concert Party, the Company has consulted with the Takeover Panel
and the Takeover Panel has agreed to waive the requirement for an
offer to be made in respect of the Conversion and the exercise of
the Warrants (the "Rule 9 Waiver"). This Rule 9 Waiver is subject
to the approval by a vote of Independent Shareholders of the
Company on a poll at the General Meeting. The Rule 9 Waiver
Resolution seeks this approval. Gatemore, Lansdowne, Sand Grove are
not considered to be independent, and will not be entitled to vote
on the Rule 9 Waiver Resolution. Accordingly, should Independent
Shareholders approve the Rule 9 Waiver Resolution, the Takeover
Panel will be waiving the requirement for the Concert Party to make
a mandatory general offer under Rule 9 of the Takeover Code as a
result of the exercise allotment and issue of Ordinary Shares upon
Conversion and/or upon the exercise of the Warrants.
11. AIM Delisting
The Company is required under the terms of the Amended and
Restated Note Purchase Agreement to seek Shareholder approval for
the AIM Delisting, which requires a special resolution to be passed
in accordance with Rule 41 of the AIM Rules for Companies. The
Delisting Resolution is set out at resolution 8 in the Notice of
General Meeting included in the Circular.
In the event that the Delisting Resolution is passed, the Board
will resolve to cancel the admission of the Ordinary Shares to
trading on AIM. Pursuant to Rule 41 of the AIM Rules, the Company,
through its nominated adviser, Peel Hunt, has notified the London
Stock Exchange of the proposed Cancellation. Under the AIM Rules,
the Company is required to give at least 20 clear Business Days'
notice of the Cancellation. Additionally, Cancellation will not
take effect until at least five clear Business Days have passed
following the passing of Resolution 8. If Resolution 8 is passed at
the General Meeting, it is proposed that the last day of trading in
the Ordinary Shares on AIM will be 17 June 2022 and that the
Cancellation will become effective following the issue of a Dealing
Notice, at 7.00 a.m. on 20 June 2022.
The effect of the AIM Delisting
If the Resolutions are passed at the General Meeting,
Shareholders will no longer be able to buy and sell Ordinary Shares
on AIM after 17 June 2022 and the Board does not intend to apply
for admission of the Ordinary Shares to any other market and,
therefore, no trading facility will be available to Shareholders
after this date.
Following the AIM Delisting taking effect, the Company will no
longer be subject to the AIM Rules for Companies or be required to
retain the services of a nominated adviser. The Company will also
no longer be subject to the QCA Corporate Governance Code or be
required to comply with the continuing obligations set out in the
DTRs or, provided the Company's securities remain outside the scope
of the regulation, UK MAR. In addition, the Company and its
Shareholders will no longer be subject to the provisions of the
DTRs relating to the disclosure of changes in significant
shareholdings in the Company. As a company incorporated in England
and Wales, the Company will continue to be subject to the
requirements of the Companies Act 2006. Furthermore, whilst the
composition of the Board will remain unchanged for the period up to
the AIM Delisting taking effect, it is expected that the Board will
undergo a restructuring to reduce costs and align skills with those
required of an unquoted company.
12. Re-registration
As a result of the Strategic Financing and Delisting, it is
proposed to re-register the Company as a private limited company .
The principal effects of the Re-registration on the rights and
obligations of Shareholders and the Company are summarised in
Appendix B of the Circular.
The Re-registration requires the approval of not less than 75
per cent. of the votes cast by Shareholders at the General
Meeting.
Subject to, and conditional upon, the AIM Delisting and the
passing of Resolutions 8 and 9, application will be made to the
Registrar of Companies for the Company to be re-registered as a
private limited company. Re-registration will take effect when the
Registrar of Companies issues a certificate of incorporation on
Re-registration. The Registrar of Companies will not issue the
certificate of incorporation on Re-registration until the Registrar
of Companies is satisfied that no valid application can be made to
cancel the resolution to re-register the Company as a private
limited company.
If Resolution 8 and Resolution 9 are passed at the General
Meeting, it is anticipated that the Re-registration will become
effective on or around 4 July 2022.
Application of the Takeover Code following the AIM Delisting and
the Re-registration
The Takeover Code applies to all offers for companies which have
their registered offices in the United Kingdom, the Channel Islands
or the Isle of Man if any of their equity share capital or other
transferable securities carrying voting rights are admitted to
trading on a UK regulated market or a UK multilateral trading
facility or on any stock exchange in the Channel Islands or the
Isle of Man.
The Takeover Code also applies to all offers for companies (both
public and private) which have their registered offices in the
United Kingdom, the Channel Islands or the Isle of Man which are
considered by the Takeover Panel to have their place of central
management and control in the United Kingdom, the Channel Islands
or the Isle of Man, but in relation to private companies only if
one of a number of conditions is met - for example, if the
company's shares were admitted to trading on a UK regulated market
or a UK multilateral trading facility or on any stock exchange in
the Channel Islands or the Isle of Man at any time in the preceding
ten years.
Following the AIM Delisting and the Re-registration, the
Takeover Code will continue to apply for a period of ten years from
the AIM Delisting provided that the Company is considered by the
Takeover Panel to have its place of central management and control
in the United Kingdom (or the Channel Islands or the Isle of Man).
This is known as the "residency test". The way in which the test
for central management and control is applied for the purposes of
the Takeover Code may be different from the way in which it is
applied by the United Kingdom tax authorities, HMRC. Under the
Takeover Code, the Takeover Panel looks to where the majority of
the Directors are resident, amongst other factors, for the purposes
of determining where the Company has its place of central
management and control.
Based on the current composition of the Board, the residency
test will be satisfied and the Takeover Code will continue to apply
to the Company following the AIM Delisting and the Re-registration.
However, the Takeover Code could cease to apply to the Company in
the future if any changes to the Board composition result in the
majority of the Directors not being resident in the United Kingdom,
Channel Islands and Isle of Man.
When the Takeover Code ceases to apply to the Company in the
future, Shareholders will not receive the protections afforded by
the Takeover Code in the event that there is a subsequent offer to
acquire their Sensyne shares. This includes the requirement for a
mandatory cash offer to be made if either:
(i) a person acquires an interest in shares which, when taken
together with the shares in which persons acting in concert with it
are interested, increases the percentage of shares carrying voting
rights in which it is interested to 30% or more; or
(ii) a person, together with persons acting in concert with it,
is interested in shares which in the aggregate carry not less than
30% of the voting rights of a company but does not hold shares
carrying more than 50% of such voting rights and such person, or
any person acting in concert with it, acquires an interest in any
other shares which increases the percentage of shares carrying
voting rights in which it is interested.
Brief details of the Takeover Panel, the Takeover Code and the
protections given by the Takeover Code are described below.
Before giving your approval to the AIM Delisting and the
Re-registration, you may want to take independent professional
advice from an appropriate independent financial adviser.
The Takeover Code
The Takeover Code is issued and administered by the Takeover
Panel. Sensyne Health plc is a company to which the Takeover Code
applies and its Shareholders are accordingly entitled to the
protections afforded by the Takeover Code.
The Takeover Code and the Takeover Panel operate principally to
ensure that shareholders are treated fairly and are not denied an
opportunity to decide on the merits of a takeover and that
shareholders of the same class are afforded equivalent treatment by
an offeror. The Takeover Code also provides an orderly framework
within which takeovers are conducted. In addition, it is designed
to promote, in conjunction with other regulatory regimes, the
integrity of the financial markets.
The General Principles and Rules of the Takeover Code
The Takeover Code is based upon a number of General Principles
which are essentially statements of standards of commercial
behaviour. For your information, these General Principles are set
out in Part 1 of Appendix A to the Circular. The General Principles
apply to all transactions with which the Takeover Code is
concerned. They are expressed in broad general terms and the
Takeover Code does not define the precise extent of, or the
limitations on, their application. They are applied by the Takeover
Panel in accordance with their spirit to achieve their underlying
purpose.
In addition to the General Principles, the Takeover Code
contains a series of Rules, of which some are effectively
expansions of the General Principles and examples of their
application and others are provisions governing specific aspects of
takeover procedure. Although most of the Rules are expressed in
more detailed language than the General Principles, they are not
framed in technical language and, like the General Principles, are
to be interpreted to achieve their underlying purpose. Therefore,
their spirit must be observed as well as their letter. The Takeover
Panel may derogate or grant a waiver to a person from the
application of a Rule in certain circumstances.
Giving up the protection of the Takeover Code
A summary of key points regarding the application of the
Takeover Code to takeovers generally is set out in Part 2 of
Appendix A to the Circular. You are encouraged to read this
information carefully as it outlines certain important protections
which you will be giving up if you agree to the AIM Delisting and
the Re-registration and the Company subsequently ceases to be
subject to the Takeover Code in the future.
14. UK tax treatment
Investors may choose to hold AIM-quoted shares because they are
classed as unlisted/unquoted securities which may qualify
individuals who are UK tax resident and UK domiciled for relief
from inheritance taxation and certain other preferential tax
benefits. The Company cannot and does not provide any form of
taxation advice to Shareholders and therefore Shareholders are
strongly advised to seek their own taxation advice to confirm the
consequences of continuing to hold Ordinary Shares and Deferred
Shares that are not admitted to trading on AIM.
The following summary does not constitute legal or tax advice
and is not exhaustive. Therefore, the following should not be
relied upon by Shareholders without taking further advice (and the
Company accepts no liability in respect of any such reliance on any
information provided herein on taxation matters).
The AIM Delisting
The AIM Delisting should not prevent the Ordinary Shares and the
Deferred Shares from qualifying as unlisted/unquoted securities for
the purposes of certain specific UK tax rules (notably, the UK
inheritance tax business property relief rules).
Subject to certain conditions, transfers of ordinary shares
admitted to trading on AIM are not subject to UK stamp duty or
SDRT. However, following the AIM Delisting, stamp duty or SDRT will
generally apply to transfers of, or agreements to transfer the
Ordinary Shares or Deferred Shares (normally being 0.5% of the
consideration).
The Sub-division
Based on current UK tax legislation, the Sub-division should not
be treated as a disposal for the purposes of UK taxation of
chargeable gains. After the Sub-division of the Existing Ordinary
Shares, the base cost of the Existing Ordinary Shares for the
purposes of UK taxation of chargeable gains should be apportioned
between the resulting Ordinary Shares and Deferred Shares.
It is strongly recommended that Shareholders obtain appropriate
professional advice in respect of their tax position in respect of
the AIM Delisting and the Sub-division.
15. Additional information
The attention of Shareholders is drawn to the information
contained in Part II (Details of the Strategic Financing) and Part
III (Additional Information) of the Circular, which provide
additional information on the Amended and Restated Note Purchase
Agreement, the Amended and Restated Warrant Instrument, the
Security Agreements and the Company.
16. Irrevocable undertakings
As at the Last Practicable Date, the Company has received voting
irrevocable undertakings from the following Shareholders to vote in
favour of the Resolutions:
(a) Lord Paul Drayson in respect of 20,103,384 Ordinary Shares
(representing approximately 12.08 per cent. of the Company's issued
share capital as at the Last Practicable Date); and
(b) Lady Elspeth Drayson in respect of 17,444,569 Ordinary
Shares (representing approximately 10.48 per cent. of the Company's
issued share capital as at the Last Practicable Date).
As at the Last Practicable Date, the Company has received voting
irrevocable undertakings from the following Shareholders to vote in
favour of the Resolutions (excluding the Rule 9 Waiver
Resolution):
(c) Sand Grove Capital Management LLP on behalf of Sand Grove
Opportunities Master Fund Ltd in respect of 11,024,633 Ordinary
Shares (representing approximately 6.62 per cent. of the Company's
issued share capital as at the Last Practicable Date).
As at the date of this Announcement, the Company has therefore
obtained irrevocable undertakings, in aggregate, to vote in favour
of:
(i) the Resolutions in respect of 37,547,953 Ordinary Shares (
representing approximately 22.56 per cent. of the Company's issued
share capital as at the Last Practicable Date); and
(ii) the Resolutions (excluding the Rule 9 Waiver Resolution) in
respect of 48,572,586 Ordinary Shares ( representing approximately
29.18 per cent. of the Company's issued share capital as at the
Last Practicable Date).
The irrevocable undertakings cease to be binding and shall lapse
if the General Meeting is not held before 31 July 2022.
Additionally, the Relevant Purchasers, who have undertaken in
the Amended and Restated Note Purchase Agreement to vote in favour
of the Resolutions (excluding the Rule 9 Waiver Resolution), hold
23,328,875 Ordinary Shares (representing approximately 14.01 per
cent. of the Company's issued share capital as at the Last
Practicable Date).
The Company has received total commitments in respect of
71,901,461 Ordinary Shares (representing approximately 43.19 per
cent. of the Company's issued share capital as at the Last
Practicable Date) to vote in favour of the Resolutions (including
from irrevocable undertakings, plus undertakings given under the
Amended and Restated Note Purchase Agreement).
17. Recommendation
As described in paragraph 2 - Background to and reasons for the
Strategic Financing, the Company did not receive an offer under the
FSP, nor was it successful in raising alternative sources of
capital and, consequently, the Company entered into the Amended and
Restated Note Purchase Agreement in order to continue trading.
The Independent Directors consider that the Strategic Financing
and the passing of the Resolutions to be in the best interests of
the Company and its Shareholders as a whole. Accordingly, the
Independent Directors unanimously recommend that Shareholders vote
in favour of all of the Resolutions. Alex Snow, who is a member of
the Concert Party and who has been appointed to the Board as Chief
Executive Officer to implement the restructuring and refocusing
plan pursuant to the Amended and Restated Note Purchase Agreement,
has a conflict of interest and accordingly has taken no part in the
recommendation of the Board in connection with the Resolutions. The
Directors who are Shareholders intend, in respect of their own
beneficial shareholdings, to vote in favour of the Resolutions.
The Independent Directors, having been so advised by Peel Hunt,
consider that the Rule 9 Waiver Resolution is fair and reasonable
and in the best interests of Shareholders and the Company as a
whole. In providing this advice, Peel Hunt has taken into account
the Independent Directors' commercial assessments. Consequently,
the Independent Directors recommend that Independent Shareholders
vote in favour of the Rule 9 Waiver Resolution as they intend to do
in respect of their own beneficial holdings, which amounts in
aggregate to 83,332 Ordinary Shares (representing approximately
0.05 per cent. of the existing issued share capital of the Company
held by the Independent Shareholders).
If Shareholders do not approve the Resolutions, the Relevant
Purchasers will be able to exercise the Asset Purchase Option under
the Amended and Restated Note Purchase Agreement and will be able
to require the transfer of all material assets of the Group
(including the Strategic Research Agreements and other data
collaboration agreements) to be transferred into Sensyne Holdings
UK, and to then purchase the entire issued share capital of Sensyne
Holdings UK for consideration of (i) the sum of GBP1 and (ii) the
assumption by the Relevant Purchasers of all the Company's
outstanding obligations in respect of the Loan Notes .
-S-
Notes for editors:
About Sensyne Health : https://www.sensynehealth.com/
Sensyne Health plc (LSE: SENS) is a clinical artificial
intelligence company operating a unique business model - a
for-profit plc making a positive social impact, sharing the
financial returns it makes with health systems. The company applies
clinical AI in the healthcare and life science industries. In
healthcare, Sensyne delivers remote patient monitoring and
real-time decision-making systems for healthcare organisations and
their patients. In life sciences, Sensyne analyses large complex
anonymised data sets to help life sciences companies accelerate the
development of new medicines.
Sensyne is listed on the AIM Market of the London Stock Exchange
(SENS).
Contacts
Sensyne Health
Alex Snow, Chief Executive Officer
Richard Pye, Chief Financial Officer
+44 (0) 330 058 1845
Peel Hunt LLP (Nominated Adviser and Broker)
+ 44 (0) 20 7418 8900
Dr Christopher Golden
James Steel
Consilium Strategic Communications
Mary-Jane Elliott
Jessica Hodgson
CSCSensynehealth@consilium-comms.com
+44 (0) 7780 600290
APPIX I - EXPECTED TIMETABLE OF PRINCIPAL EVENTS
Event Date
Announcement of the Strategic Financing 19 April 2022
Notice of the proposed Cancellation provided 18 May 2022
in accordance with AIM Rule 41
Publication of the Circular and Form of Proxy 18 May 2022
Latest time and date for receipt of completed 11.00 a.m. on
Form of Proxy to be valid at the General Meeting 31 May 2022
General Meeting 11.00 a.m. on
6 June 2022
Results of General Meeting announced through 6 June 2022
RIS
Expected last day of dealings on AIM in the 17 June 2022
Ordinary Shares
Record Time for the Sub 6.00 p.m. on 17
June 2022
Cancellation of the admission to trading on 7.00 a.m. on 20
AIM of the Ordinary Shares June 2022
Expected date of re-registration as a private on or around 4
limited company July 2022
Notes
1. Each of the times and dates set out in the above timetable
and mentioned in this Announcement is subject to change by the
Company, in which event details of the new times and dates will be
notified to London Stock Exchange plc and the Company will make an
appropriate announcement to a Regulatory Information Service.
2. References to times in this Announcement are to London time unless otherwise stated
3. If you have questions on how to complete the Form of Proxy,
please contact Equiniti Limited on 0371 384 2030 or, if calling
from outside the United Kingdom, +44 (0)121 415 7047 Lines are open
from 8.30 a.m. to 5.30 p.m. (London time) Monday to Friday (except
English and Welsh public holidays).
APPIX II - DEFINITIONS
The following definitions apply throughout this Announcement,
unless the context requires otherwise:
"2021 AGM" the annual general meeting of the Company
held on 29 October 2021
"Additional A Note Gatemore Investment Partners I LP, Lansdowne
Purchasers" and Hambro Perks Nominee
"Additional A Notes" the loan notes in the aggregate principal
amount of GBP6,000,000 issued by the Company
to the Additional A Note Purchasers pursuant
to the Amended and Restated Note Purchase
Agreement
"Additional B Notes" the loan notes issued or to be issued
by the Company pursuant to the Amended
and Restated Note Purchase Agreement,
of such denomination and any principal
amount as may be determined by the Company
(provided that the total aggregate principal
amount of Additional Notes does not exceed
GBP20,000,000)
"Additional C Notes" the loan notes issued or to be issued
by the Company pursuant to the Amended
and Restated Note Purchase Agreement,
of such denomination and any principal
amount as may be determined by the Company
(provided that the total aggregate principal
amount of Additional Notes does not exceed
GBP20,000,000)
"Additional Notes" the Additional A Notes, the Additional
B Notes and the Additional C Notes
"AI" artificial intelligence
"AIM" the market of that name operated by the
London Stock Exchange
"AIM Delisting" or the cancellation of the admission of the
"Cancellation" Ordinary Shares to trading on AIM, subject
to the passing of the Delisting Resolution
"AIM Rules" the AIM Rules for Companies and/or the
AIM Rules for Nominated Advisers (as the
context may require)
"AIM Rules for Companies" the rules of AIM as set out in the publication
entitled "AIM Rules for Companies" published
by the London Stock Exchange from time
to time
"AIM Rules for Nominated the rules of AIM as set out in the publication
A dvisers " entitled "AIM Rules for Nominated Advisers"
published by the London Stock Exchange
from time to time
"Amended and Restated the note purchase agreement entered into
Note Purchase Agreement between the Company, the Note Purchasers,
" the Noteholders Representative and the
Security Agent, dated 26 January 2022
and as amended and restated on 18 April
2022, and as further amended on 17 May
2022 by the Amendment Letter to the Amended
and Restated Note Purchase Agreement,
pursuant to which the Note Purchasers
agreed to purchase the Loan Notes on the
terms and conditions set out therein
"Amended and Restated the warrant instrument entered into by
Warrant Instrument" the Company by way of deed poll dated
26 January 2022 and as amended and restated
on 18 April 2022, pursuant to which the
Company constituted the Warrants
"Amendment Letter to the amendment letter in respect of the
the Amended and Restated Original Note Purchase Agreement and the
Note Purchase Agreement" Amended and Restated Note Purchase Agreement,
and entered into between the Company,
the Note Purchasers, the Noteholders Representative
and the Security Agent, dated 17 May 2022
pursuant to which the parties agreed to
certain amendments to the Amended and
Restated Note Purchase Agreement
"Announcement" this announcement
"Articles" the articles of association of the Company
in force at the date of this Announcement
"Asset Purchase Option" the conditional option of the Relevant
Purchasers to require all of the material
assets of the Group to be transferred
to Sensyne Holdings UK and then to purchase
the entire issued share capital of Sensyne
Holdings UK for consideration of (i) the
sum of GBP1 and (ii) the assumption by
the Relevant Purchasers of all the Company's
outstanding obligations in respect of
the Loan Notes, as set out in the Amended
and Restated Note Purchase Agreement
"Board" or "Directors" the board of directors of the Company,
whose names are listed on page 5 of the
Circular
"Business Day" any day (excluding Saturdays and Sundays
and public holidays in England and Wales)
on which banks are open in London for
normal banking business and the London
Stock Exchange is open for trading
"Circular" the circular of the Company giving (amongst
other things) details of the Strategic
Financing and incorporating the Notice
of General Meeting
"Company" or "Sensyne" Sensyne Health plc, a public limited company
incorporated in England and Wales with
company number 11425451
"Concert Party" Gatemore, Lansdowne, Hambro Perks, Sand
Grove and Alex Snow.
"Conversion" the conversion of any principal amount
of the Loan Notes (including the Redemption
Premium) into Ordinary Shares in accordance
with the Amended and Restated Note Purchase
Agreement
"Conversion Conditions" the passing of Resolutions 1 to 7 by the
Shareholders and the grant of the Rule
9 Waiver
"Conversion Price" the price at which the Loan Notes convert
into Ordinary Shares, being GBP0.10 per
Ordinary Share (being the current nominal
value of the Ordinary Shares) in respect
of the Loan Notes and, following completion
of the Sub-division, GBP0.008 per Ordinary
Share (being the resulting nominal value
of the Ordinary Shares following the Sub-division)
"Dealing Notice" a notification by the London Stock Exchange
disseminated through the RIS giving notice
that the Ordinary Shares are cancelled
from trading on AIM
"Deferred Shares" the deferred shares of GBP0.092 each in
the capital of the Company resulting from
the Sub-division, which shall have no
voting rights, no rights to receive dividends
or other distributions, on a return of
assets upon liquidation shall only be
entitled to the nominal amount paid up
thereon, and shall have no other right
to participate in the assets of the Company
"Delisting Resolution" resolution 8 of the resolutions to be
proposed at the General Meeting relating
to the Delisting as set out in the Notice
of General Meeting included in the Circular
"Existing Ordinary the 166,464,335 Ordinary Shares in issue
Shares" on the Last Practicable Date
"First Ranking Debenture" the English law governed debenture dated
26 January 2022 between the Company, Sensyne
Holdings UK, Sensyne Group UK and the
Security Agent, pursuant to which the
first ranking debenture was granted over
substantially all of the assets and undertakings
of the Group (subject to certain agreed
exceptions)
"First Ranking Security the New York law governed pledge and security
Agreement" agreement dated 26 January 2022 between
Sensyne Holdings UK, Sensyne Group UK,
Sensyne US and the Security Agent, pursuant
to which the first ranking security interest
was granted over certain US collateral
of the Group
"Form of Proxy" the form of proxy accompanying the Circular
for use by Shareholders in relation to
the General Meeting
"Formal Sale Process" the formal sale process in relation to
or "FSP" the Company for the purposes of the Takeover
Code, as announced by the Company on 2
November 2021 and as terminated by the
Company on 19 April 2022
"Gatemore" Gatemore Capital Management LLP, acting
for itself and for and on behalf of Gatemore
Special Opportunities Master Fund and
Gatemore Investment Partners I LP
"General Meeting" the general meeting of the Shareholders
of the Company to be held at the offices
of Covington & Burling LLP, 22 Bishopsgate,
London EC2N 4BQ at 11.00 a.m. on 6 June
2022
"Group" the Company, its subsidiaries and subsidiary
undertakings
"Hambro Perks" HPL and Hambro Perks Nominee
"Hambro Perks Nominee" MNL (Hambro Perks) Nominees Limited
"HPL" Hambro Perks Limited
"Independent Directors" the Directors of the Company excluding
Alex Snow
"Independent Shareholders" means the Shareholders of the Company
excluding Gatemore, Lansdowne and Sand
Grove
"JP Morgan" J.P. Morgan Securities plc, which conducts
its UK investment banking business as
J.P. Morgan Cazenove
"Lansdowne" Lansdowne Partners (UK) LLP, acting for
itself and for and on behalf of Lansdowne
Developed Markets Master Fund Limited
and Lansdowne Developed Markets Strategic
Investment Master Fund Limited
"Last General Meeting" the general meeting of the Company held
on 11 February 2022
"Last Practicable Date" 17 May 2022, being the latest practicable
date prior to the publication of the Circular
"Loan Notes" the loan notes in the aggregate principal
amount of up to GBP26,350,000 issued or
to be issued by the Company pursuant to
the Amended and Restated Note Purchase
Agreement, comprised of the Original Notes
and the Additional Notes
"London Stock Exchange" London Stock Exchange plc
"New Articles" the articles of association of the Company
as set out in Appendix C, as proposed
to be adopted pursuant to resolution 10
of the Resolutions to reflect the Delisting
and status of the Company as a private
limited company following the Re-registration
"NHS" the National Health Service
"NHS Trust" a legal entity as set up by order of the
Secretary of State under section 25 of,
and Schedule 4 to, the National Health
Service Act 2006, to provide goods and
services for the purposes of the health
service
"Note Purchasers" the Original Purchasers and the Additional
A Note Purchasers
"Noteholders" the holders of the Loan Notes for the
time being
"Noteholders Representative" Kroll Agency Services Limited (formerly
known as Lucid Agency Services Limited)
acting as representative of the Noteholders
"Notice of General the notice of General Meeting which is
Meeting" set out at the end of the Circular
"Ordinary Shares" ordinary shares of GBP0.10 each in the
capital of the Company, which following
completion of the Sub-division shall be
ordinary shares of GBP0.008 each in the
capital of the Company
"Original Note Purchase the agreement entered into between the
Agreement" Company, Sensyne Holdings UK, Sensyne
Group UK, Sensyne US, the Noteholders
Representative and the Security Agent
dated 26 January 2022, pursuant to which
the Original Purchasers agreed to purchase
the Original Loan Notes on the terms and
conditions set out therein
"Original Notes" the loan notes in the aggregate principal
amount of GBP6,350,000 issued by the Company
to the Original Purchasers pursuant to
the Original Note Purchase Agreement
"Original Purchasers" Gatemore Special Opportunities Master
Fund, Sand Grove, Lansdowne and Peel Hunt
"Peel Hunt" Peel Hunt LLP, a limited liability partnership
incorporated and registered in England
with No. OC357088 whose registered office
is 7th Floor, 100 Liverpool Street, London
EC2M 2AT, the Company's nominated adviser
and broker
"R&D" research and development
"Redemption Premium" in respect of the participation in any
Loan Note being prepaid, redeemed or repurchased,
an amount calculated at the rate of 25
per cent. of the redemption or repurchase
price (such redemption or repurchase price
being equal to the principal amount thereof)
"Registrars" or "Equiniti" Equiniti Limited of Aspect House, Spencer
Road, Lancing, West Sussex BN99 6DA
"Regulatory Information a regulatory information service operated
Service" or "RIS" by the London Stock Exchange as defined
in the AIM Rules for Companies
"Relevant Purchasers" the Original Purchasers (excluding Peel
Hunt), Gatemore Investment Partners I
LP and Hambro Perks Nominee
"Re-registration" the re-registration of the Company as
a private limited company
"Resolutions" the resolutions to be proposed at the
General Meeting as set out in the Notice
of General Meeting included in the Circular
"Revised Articles" the articles of association of the Company,
as proposed to be amended pursuant to
resolution 2 of the Resolutions to include
the rights of the Deferred Shares following
the Sub-division
"Rule 9 Waiver" the waiver granted by the Takeover Panel
of the obligation of the Concert Party
to make a general offer for the Company
under Rule 9 of the Takeover Code which
would otherwise arise as a result of the
issue to the Concert Party of Ordinary
Shares pursuant to the Conversion and/
or exercise of the Warrants, with such
waiver being conditional upon the approval
of the Independent Shareholders of the
Rule 9 Waiver Resolution on a poll
"Rule 9 Waiver Resolution" means resolution 7 of the Resolutions
as set out in the Notice of General Meeting
to approve the waiver granted by the Takeover
Panel of the obligation of the Concert
Party to make a general offer for the
Company under Rule 9 of the Takeover Code
which would otherwise arise, as a result
of the issue to the Concert Party of Ordinary
Shares pursuant to the Conversion and/
or exercise of the Warrants
"Sand Grove" Sand Grove Capital Management LLP, acting
for itself and for and on behalf of Sand
Grove Opportunities Master Fund Ltd. and
Sand Grove Tactical Fund LP
"Second Ranking Debenture" the English law governed debenture dated
18 April 2022 between the Company, Sensyne
Holdings UK, Sensyne Group UK and the
Security Agent, pursuant to which the
second ranking debenture was granted over
substantially all of the assets and undertakings
of the Group (subject to certain agreed
exceptions)
"Second Ranking Security the New York law governed pledge and security
Agreement" agreement dated 18 April 2022 between
Sensyne Holdings UK, Sensyne Group UK,
Sensyne US and the Security Agent, pursuant
to which the second ranking security interest
was granted over certain US collateral
of the Group
"Security Agent" Kroll Trustee Services Limited (formerly
known as Lucid Trustee Services Limited)
acting as security agent to the Noteholders
"Security Agreements" the First Ranking Debenture, the Second
Ranking Debenture, the First Ranking Security
Agreement and the Second Ranking Security
Agreement
"Sensyne Group UK" Sensyne Health Group Limited, a private
limited company incorporated in England
and Wales with company number 11240986
and which is a wholly-owned subsidiary
of the Company
"Sensyne Holdings UK" Sensyne Health Holdings Limited, a private
limited company incorporated in England
and Wales with company number 09427409
and which is a wholly-owned subsidiary
of the Company
"Sensyne US" Sensyne Health, Inc. (file number 5762006),
an incorporation organised under the general
corporation law of the State of Delaware,
United States and which is a wholly-owned
subsidiary of the Company
"Shareholders" and the holders of Ordinary Shares for the
each being individually time being
a "Shareholder"
"Strategic Financing" the secured financing of the Company through
the issue of the Loan Notes pursuant to
the terms of the Amended and Restated
Note Purchase Agreement
"Strategic Research an agreement with a healthcare provider
Agreement" (such as an NHS Trust) that grants Sensyne
access to anonymised patient data for
commercial purposes
"Sub-division" means the proposed sub-division and re-designation
of each Existing Ordinary Share of GBP0.10
in the capital of the Company into one
new ordinary share of GBP0.008 in the
capital of the Company and one Deferred
Share in the capital of the Company
"Takeover Code" the City Code on Takeovers and Mergers
published by the Takeover Panel
"Takeover Panel" the Panel on Takeovers and Mergers
"UK MAR" the EU Market Abuse Regulation (EU) No
596/2014 as it forms part of UK domestic
law by virtue of the European Union (Withdrawal)
Act 2018
"UK" or "United Kingdom" the United Kingdom of Great Britain and
Northern Ireland
"US" or "United States" the United States of America, its territories
and possessions, any state of the United
States and the District of Columbia
"Warrant Exercise Price" the exercise price of the Warrants, being
GBP0.10 per Warrant (being the current
nominal value of an Ordinary Share) and,
following completion of the Sub-division,
GBP0.008 per Warrant (being the resulting
nominal value of an Ordinary Share following
the Sub-division)
"Warrants" warrants to subscribe for up to 29,169,448
Ordinary Shares and which are exercisable
at the Warrant Exercise Price and otherwise
in accordance with the terms of the Amended
and Restated Warrant Instrument
All references in this Announcement to "GBP", "pence" or "p"
are to the lawful currency of the United Kingdom
All references to time in this Announcement are to London Time.
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END
CIRGPURUAUPPGQR
(END) Dow Jones Newswires
May 18, 2022 12:12 ET (16:12 GMT)
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