NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION IN WHOLE OR IN PART, DIRECTLY OR INDIRECTLY, IN OR INTO AUSTRALIA, CANADA, SWITZERLAND, SOUTH KOREA, ISRAEL, SOUTH AFRICA, JAPAN, SINGAPORE AND THE UNITED STATES AND ANY OTHER JURISDICTION WHERE TO DO SO WOULD CONSTITUTE A VIOLATION OF THE RELEVANT LAWS OR REGULATIONS OF SUCH JURISDICTION.
THIS ANNOUNCEMENT IS AN ADVERTISEMENT AND DOES NOT CONSTITUTE OR FORM A PART OF A PROSPECTUS OR PROSPECTUS EQUIVALENT DOCUMENT. NOTHING HEREIN SHALL CONSTITUTE OR FORM A PART OF ANY OFFER, INVITATION OR RECOMMENDATION TO PURCHASE, SELL OR SUBSCRIBE FOR ANY SECURITIES IN ANY JURISDICTION. NOTHING IN THIS ANNOUNCEMENT SHOULD BE INTERPRETED AS A TERM OR CONDITION OF THE CAPITAL RAISING. NOTHING CONTAINED HEREIN SHALL FORM THE BASIS OF OR BE RELIED UPON IN CONNECTION WITH, OR ACT AS AN INDUCEMENT TO ENTER INTO, ANY INVESTMENT ACTIVITY. ANY DECISION TO PURCHASE, SUBSCRIBE FOR, OTHERWISE ACQUIRE, SELL OR OTHERWISE DISPOSE OF SECURITIES MENTIONED HEREIN MUST BE MADE ONLY ON THE BASIS OF THE INFORMATION CONTAINED IN AND INCORPORATED BY REFERENCE INTO THE PROSPECTUS ONCE PUBLISHED. COPIES OF THE PROSPECTUS WILL, FOLLOWING PUBLICATION, BE AVAILABLE FROM THE REGISTERED OFFICE OF THE COMPANY AND ON ITS WEBSITE AT WWW.VIDENDUM.COM, SUBJECT TO APPLICABLE LAW AND REGULATIONS. PLEASE SEE THE IMPORTANT NOTICES AT THE END OF THIS ANNOUNCEMENT.
THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION FOR THE PURPOSES OF ARTICLE 7 OF THE UK VERSION OF THE MARKET ABUSE REGULATION (EU 596/2014) WHICH IS PART OF UK LAW BY VIRTUE OF THE EUROPEAN UNION (WITHDRAWAL) ACT 2018.
20 November 2023
VIDENDUM plc
Proposed £125 million underwritten Capital Raising by way of Firm Placing and Placing and Open Offer
Videndum plc ("Videndum" or the "Company", and together with its subsidiaries, the "Group") today announces that it proposes to issue 46,870,787 New Ordinary Shares by way of a firm placing, placing and open offer (the "Capital Raising") for 267 pence per New Ordinary Share (the "Offer Price"). Through the issue of New Ordinary Shares, the Company expects to raise gross proceeds of approximately £125 million.
Key highlights
· Intention to raise gross proceeds of approximately £125 million through a Firm Placing and Placing and Open Offer:
- £75 million to be raised through the Firm Placing; and
- £50 million to be raised through the Placing and Open Offer.
· The Firm Placing and Placing are being conducted by way of an accelerated bookbuild process (the "Bookbuild"), which will be launched immediately following this announcement and is subject to the terms and conditions set out in Appendix II to this Announcement (which forms part of this Announcement).
· The Placing will be subject to clawback to satisfy Open Offer Entitlements taken up by Qualifying Shareholders in the Open Offer.
· The timing of when the Bookbuild will close and allocations will be at the discretion of the Joint Global Co-ordinators and the Company. Details of the results of the Firm Placing and the Placing will be announced as soon as practicable after the close of the Bookbuild.
· The Group intends to use the net proceeds from the Capital Raising to reduce Leverage as follows:
- $55 million (£44.2 million) in net proceeds is intended to fund the repayment and cancellation of the Group's outstanding term loans, which relate to the acquisitions of Savage and Audix, which as at the Latest Practicable Date had an outstanding balance of $55 million (£44.2 million).
- £72.5 million in net proceeds is intended to be utilised to repay drawings under the Group's £200 million Revolving Credit Facility.
· 28,122,472 New Ordinary Shares will be issued through the Firm Placing to raise approximately £75 million in gross proceeds, and 18,748,315 New Ordinary Shares will be issued through the Placing and Open Offer to raise gross proceeds of approximately £50 million.
· The Offer Price represents a discount of 3.3% to the Closing Price of 276 pence per Ordinary Share on 20 November 2023.
· The offer period for acceptances by Qualifying Shareholders will commence on 22 November 2023 and end at 11.00 a.m. on 6 December 2023.
· The Capital Raising is fully underwritten by the Joint Bookrunners and is conditional upon, among other things, the approval of Videndum Shareholders at a general meeting of the Company which will take place at 10:30 a.m. (London time) on 7 December 2023.
· The Company has received an irrevocable undertaking from Alantra confirming its intention to vote in favour of the Resolutions at the General Meeting, in respect of an aggregate of 9,908,153 Existing Ordinary Shares, representing approximately 21.1% of the Existing Ordinary Shares as at the Latest Practicable Date.
· The Company has also received an irrevocable undertaking from Aberforth Partners confirming its intention to vote in favour of the Resolutions at the General Meeting, in respect of an aggregate of 4,469,760 Existing Ordinary Shares, representing approximately 9.54% of the Existing Ordinary Shares as at the Latest Practicable Date.
· In addition, all of the Directors and certain of the senior management have shown their support for the Capital Raising by committing to subscribe for 459,167 New Ordinary Shares at the Offer Price pursuant to direct subscription agreements with the Company (conditional upon Admission), generating an additional £1.2 million of proceeds.
· The Company intends to publish a prospectus tomorrow in connection with the Capital Raising and convene a general meeting to be held on 7 December 2023.
· An audio webcast and Q&A for Analysts and Investors will be held tomorrow (21 November 2023), starting at 10:30 a.m. (London time). The presentation slides and a link to pre-register for access to the webcast can be found at https://videndum.com/investors/proposed-equity-raise/.
Prospectus
A prospectus (the "Prospectus") setting out full details of the Capital Raising is expected to be published on Videndum's website tomorrow. The preceding summary should be read in conjunction with the full text of the following announcement, together with the Prospectus.
Unless the context otherwise requires, words and expressions defined in the Prospectus shall have the same meanings in this announcement.
Indicative summary timetable of principal events
| Record Date for Open Offer Entitlements | 6:00 p.m. on 17 November 2023 |
| Announcement of the Capital Raising | 20 November 2023 |
| Ex-Entitlements Date for the Open Offer | 8.00 a.m. on 21 November 2023 |
| Publication of the Prospectus | 21 November 2023 |
| Posting of the Prospectus, Application Forms (to Qualifying Non-Crest Shareholders only) and the Form of Proxy | 21 November 2023 |
| Open Offer Entitlements credited to stock accounts in CREST (Qualifying CREST Shareholders only) | as soon as practicable after 8.00 a.m. on 22 November 2023 |
| Recommended latest time for requesting withdrawal of Open Offer Entitlements from CREST (i.e. if your Open Offer Entitlements are in CREST and you wish to convert them to certificated form) | 4.30 p.m. on 30 November 2023 |
| Latest time for depositing Open Offer Entitlements into CREST (i.e. if your Open Offer Entitlements are represented by an Application Form and you wish to convert them to uncertificated form) | 3.00 p.m. on 1 December 2023 |
| Latest time and date for splitting Application Forms (to satisfy bona fide market claims only) | 3.00 p.m. on 4 December 2023 |
| Latest time and date for receipt of Forms of Proxy | 10.30 a.m. on 5 December 2023 |
| Latest time and date for receipt of completed Application Forms and payments in full and settlement of CREST instructions (as appropriate) | 11.00 a.m. on 6 December 2023 |
| General Meeting | 10.30 a.m. on 7 December 2023 |
| Announcement of the results of the Capital Raising and General Meeting | 7 December 2023 |
| Admission and dealings of the New Ordinary Shares, fully paid, commence on the London Stock Exchange | 8.00 a.m. on 8 December 2023 |
| New Ordinary Shares credited to stock accounts in CREST (Qualifying CREST Shareholders only) | as soon as possible after 8.00 a.m. on 8 December 2023 |
| Expected date for despatch of definitive share certificates for the New Ordinary Shares in certificated form | by no later than 22 December 2023 |
The person responsible for release of this announcement on behalf of Videndum is Jon Bolton, Company Secretary.
For further information, please contact:
| Videndum plc | +44 (0)20 8332 4602 |
| N.M. Rothschild & Sons Limited (Sponsor and Financial Adviser) Ravi Gupta John Byrne Shannon Nicholls Ricky Paul | +44 (0)20 7280 5000 |
| Jefferies International Limited (Joint Global Co-ordinator and Joint Bookrunner) Ed Matthews Lee Morton Will Soutar | +44 (0)20 7029 8000 |
| Investec Bank plc (Joint Global Co-ordinator and Joint Bookrunner) David Flin Ben Griffiths Will Brinkley | +44 (0)20 7597 5970 |
| MHP Group (Communications Adviser) Tim Rowntree Ollie Hoare Robert Collett-Creedy Christian Harte | +44 (0) 7817 458 804 +44 (0) 7736 464 749 |
Important notices
This announcement has been issued by and is the sole responsibility of the Company. The information contained in this announcement is for background purposes only and does not purport to be full or complete. No reliance may or should be placed by any person for any purpose whatsoever on the information contained in this announcement or on its accuracy, fairness or completeness. The information in this announcement is subject to change without notice.
This announcement is not a prospectus (or a prospectus equivalent document) but an advertisement for the purposes of the Prospectus Regulation Rules of the FCA. Neither this announcement nor anything contained in it shall form the basis of, or be relied upon in conjunction with, any offer or commitment whatsoever in any jurisdiction. Investors should not acquire any New Ordinary Shares referred to in this announcement except on the basis of the information contained in the Prospectus to be published by the Company in connection with the Capital Raising.
Neither the content of the Company's website nor any website accessible by hyperlinks on the Company's website is incorporated in, or forms part of, this announcement. The Prospectus will provide further details of the New Ordinary Shares being offered pursuant to the Capital Raising.
This announcement (and the information contained herein) is not for release, publication, transmission, forwarding or distribution, directly or indirectly, in whole or in part, in, into or within the United States of America, its territories and possessions, any State of the United States or the District of Columbia (collectively, the "United States"). This announcement is for information purposes only and is not intended to constitute, and should not be construed as, an offer to sell or issue, or a solicitation of any offer to purchase, subscribe for or otherwise acquire, securities in the United States. Securities may not be offered or sold in the United States absent registration under the US Securities Act of 1933, as amended (the "US Securities Act"), or an exemption therefrom. The New Ordinary Shares have not been and will not be registered under the US Securities Act or under any securities laws of any state or other jurisdiction of the United States and may not be offered, sold, pledged, taken up, exercised, resold, renounced, transferred or delivered, directly or indirectly, in or into the United States except pursuant to an applicable exemption from, or in a transaction not subject to, the registration requirements of the US Securities Act and in compliance with any applicable securities laws of any state or other jurisdiction of the United States. No public offering of the New Ordinary Shares has been or will be made in the United States. Subject to certain limited exceptions, Application Forms have not been, and will not be, sent to, and Open Offer Entitlements have not been, and will not be, credited to the CREST account of, any Qualifying Shareholder with a registered address in or that is known to be located in the United States. None of the New Ordinary Shares, Open Offer Entitlements, Application Forms, this announcement or any other document connected with the Capital Raising has been or will be approved or disapproved by the United States Securities and Exchange Commission or by the securities commissions of any state or other jurisdiction of the United States or any other regulatory authority, nor have any of the foregoing authorities passed upon or endorsed the merits of the offering of the New Ordinary Shares, or the accuracy or adequacy of the Application Forms, this announcement or any other document connected with the Capital Raising. Any representation to the contrary is a criminal offence in the United States.
This announcement is for information purposes only and is not intended to and does not constitute or form part of any offer or invitation to purchase or subscribe for, or any solicitation to purchase or subscribe for New Ordinary Shares or to take up any entitlements to New Ordinary Shares in any jurisdiction. No offer or invitation to purchase or subscribe for, or any solicitation to purchase or subscribe for New Ordinary Shares or to take up any entitlements to New Ordinary Shares will be made in any jurisdiction in which such an offer or solicitation is unlawful. The information contained in this announcement and the Prospectus is not for release, publication or distribution to persons in Australia, Canada, Switzerland, South Korea, Israel, South Africa, Japan, Singapore and the United States, and any other jurisdiction where the extension or availability of the Capital Raising (and any other transaction contemplated thereby) would breach any applicable law or regulation, and, subject to certain exceptions, should not be distributed, forwarded to or transmitted in or into any jurisdiction, where to do so might constitute a violation of local securities laws or regulations.
The distribution of this announcement, the Prospectus, the Application Form and the offering or transfer of New Ordinary Shares into jurisdictions other than the United Kingdom may be restricted by law, and, therefore, persons into whose possession this announcement, the Prospectus, the Application Form and/or any accompanying documents comes should inform themselves about and observe any such restrictions. Any failure to comply with any such restrictions may constitute a violation of the securities laws of such jurisdiction. In particular, subject to certain exceptions, this announcement, the Prospectus (once published) and the Application Forms (once printed) should not be distributed, forwarded to or transmitted in or into Australia, Canada, Switzerland, South Korea, Israel, South Africa, Japan, Singapore and the United States, or any other jurisdiction where the extension or availability of the Capital Raising (and any other transaction contemplated thereby) would breach any applicable law or regulation.
Recipients of this announcement and/or the Prospectus should conduct their own investigation, evaluation and analysis of the business, data and property described in this announcement and/or the Prospectus. This announcement does not constitute a recommendation concerning any investor's options with respect to the Capital Raising. The price and value of securities can go down as well as up. Past performance is not a guide to future performance. The contents of this announcement are not to be construed as legal, business, financial or tax advice. Each shareholder or prospective investor should consult his, her or its own legal adviser, business adviser, financial adviser or tax adviser for legal, financial, business or tax advice.
Notice to all investors
Rothschild & Co is authorised and regulated by the FCA in the United Kingdom. Rothschild & Co is acting exclusively for Videndum plc and no one else in connection with this announcement and the Capital Raising will not be responsible to anyone other than Videndum plc for providing the protections afforded to its clients nor for providing advice to any person in relation to the Capital Raising or any matters referred to in this announcement.
Investec Bank plc ("IBP") is authorised in the United Kingdom by the Prudential Regulation Authority and regulated by the FCA and the Prudential Regulation Authority in the United Kingdom. Investec Europe Limited (trading as Investec Europe) ("IEL"), acting as agent on behalf of IBP in certain jurisdictions in the EEA (IBP and IEL together hereafter referred to as "Investec"), is regulated in Ireland by the Central Bank of Ireland. Jefferies is authorised and regulated by the FCA in the United Kingdom. Investec and Jefferies are acting exclusively for Videndum plc and no one else in connection with this announcement and the Capital Raising and will not be responsible to anyone other than Videndum plc for providing the protections afforded to its clients nor for providing advice to any person in relation to the Capital Raising or any matters referred to in this announcement.
None of the Banks, nor any of their respective subsidiaries, branches or affiliates, nor any of their respective directors, officers or employees owes or accepts any duty, liability or responsibility whatsoever (whether direct or indirect, whether in contract, in tort, under statute or otherwise) to any person who is not a client of Rothschild & Co, Investec or Jefferies in connection with the Capital Raising, this announcement, any statement contained herein, 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 the Banks, nor any of their respective subsidiaries, branches, affiliates or agents as to, or in relation to, the accuracy or completeness of this announcement or any other information made available to or publicly available to any interested party or its advisers, whether written, oral or in a visual or electronic form, and howsoever transmitted or made available, and any liability therefore is expressly disclaimed. None of the information in this announcement has been independently verified or approved by the Banks or any of their respective affiliates.
The Joint Global Co-ordinators, in accordance with applicable legal and regulatory provisions, may engage in transactions in relation to the New Ordinary Shares and/or related instruments for their own account for the purpose of hedging their underwriting exposure or otherwise. In connection with the Capital Raising, the Joint Global Co-ordinators and any of their respective affiliates, acting as investors for their own accounts may acquire New Ordinary Shares as a principal position and in that capacity may retain, acquire, subscribe for, purchase, sell, offer to sell or otherwise deal for their own accounts in such New Ordinary Shares and other securities of the Company or related investments in connection with the Capital Raising or otherwise. Accordingly, references in this announcement to the New Ordinary Shares being issued, offered, subscribed, acquired, placed or otherwise dealt in should be read as including any issue, offer, subscription, acquisition, placing or dealing by each of the Joint Global Co-ordinators and any of their respective affiliates acting as investors for their own accounts. In addition, certain of the Joint Global Co-ordinators or their respective affiliates may enter into financing arrangements (including swaps or contracts for difference) with investors in connection with which such Joint Global Co-ordinators (or their respective affiliates) may from time to time acquire, hold or dispose of New Ordinary Shares.
In the event that the Joint Global Co-ordinators acquire New Ordinary Shares which are not taken up by Qualifying Shareholders (as defined in the Prospectus), the Joint Global Co-ordinators may co-ordinate disposals of such shares in accordance with applicable law and regulation. Except as required by applicable law or regulation, the Joint Global Co-ordinators and their respective affiliates do not propose to make any public disclosure in relation to such transactions.
Information to distributors
Solely for the purposes of the product governance requirements of Chapter 3 of the FCA Handbook Product Intervention and Product Governance Sourcebook (the "UK Product Governance Requirements"), and disclaiming all and any liability, whether arising in tort, contract or otherwise, which any "manufacturer" (for the purposes of the UK Product Governance Requirements) may otherwise have with respect thereto the New Ordinary Shares have been subject to a product approval process, which has determined that they each are: (a) compatible with an end target market of retail investors and investors who meet the criteria of professional clients and eligible counterparties, each as defined in Chapter 3 of the FCA Handbook Conduct of Business Sourcebook; and (b) eligible for distribution through all permitted distribution channels (the "Target Market Assessment"). Notwithstanding the Target Market Assessment, "distributors" (for the purposes of the UK Product Governance Requirements) should note that: the price of the New Ordinary Shares may decline and investors could lose all or part of their investment; the New Ordinary Shares offer no guaranteed income and no capital protection; and an investment in the New Ordinary Shares is compatible only with investors who do not need a guaranteed income or capital protection, who (either alone or in conjunction with an appropriate financial or other adviser) are capable of evaluating the merits and risks of such an investment and who have sufficient resources to be able to bear any losses that may result therefrom. The Target Market Assessment is without prejudice to any contractual, legal or regulatory selling restrictions in relation to the Capital Raising. Furthermore, it is noted that, notwithstanding the Target Market Assessment, the Joint Global Co-ordinators will only procure investors who meet the criteria of professional clients and eligible counterparties.
For the avoidance of doubt, the Target Market Assessment does not constitute: (i) an assessment of suitability or appropriateness for the purposes of Chapters 9A or 10A, respectively, of the FCA Handbook Conduct of Business Sourcebook; or (ii) a recommendation to any investor or group of investors to invest in, or purchase, or take any other action whatsoever with respect to, the New Ordinary Shares. Each distributor is responsible for undertaking its own target market assessment in respect of the New Ordinary Shares and determining appropriate distribution channels.
Forward-looking statements
This announcement contains forward-looking statements, including with respect to financial information, that are based on current expectations or beliefs, as well as assumptions about future events. These forward-looking statements can be identified by the fact that they do not relate only to historical or current facts. In some cases, forward-looking statements use words such as "anticipate", "target", "expect", "estimate", "intend", "plan", "goal", "believe", "will", "may", "should", "would", "could", "is confident", or other words of similar meaning.
None of the Company, its officers, advisers or any other person gives any representation, assurance or guarantee that the occurrence of the events expressed or implied in any forward-looking statements in this announcement will actually occur, in part or in whole.
No undue reliance should be placed on any such statements because they speak only as at the date of this announcement and, by their very nature, they are subject to known and unknown risks and uncertainties and can be affected by other factors that could cause actual results, and the Company's plans and objectives, to differ materially from those expressed or implied in the forward-looking statements. No representation or warranty is made that any forward-looking statement will come to pass. You are advised to read the Prospectus when published and the information incorporated by reference therein in their entirety, and, in particular, the section of the Prospectus headed "Risk Factors", for a further discussion of the factors that could affect the Group's future performance and the industry in which it operates. In light of these risks, uncertainties and assumptions, the events described in the forward-looking statements, including statements regarding prospective financial information, in this announcement may not occur. In addition, even if the Group's actual results of operations, financial condition and the development of the business sectors in which it operates are consistent with the forward-looking statements contained in the Prospectus, those results or developments may not be indicative of results or developments in subsequent periods. These statements are not fact and should not be relied upon as being necessarily indicative of future results, and readers of this announcement are cautioned not to place undue reliance on the forward-looking statements, including those regarding prospective financial information.
No statement in this announcement is intended as a profit forecast or estimate for any period, and no statement in this announcement should be interpreted to mean that underlying operating profit for the current or future financial years would necessarily be above a minimum level, or match or exceed the historical published operating profit or set a minimum level of operating profit, nor that earnings or earnings per share or dividend per share for the Company for the current or future financial years would necessarily match or exceed the historical published earnings or earnings per share or dividend per share for the Company.
Neither the Company nor any of the Banks or their respective affiliates are under any obligation to update or revise publicly any forward-looking statement contained within this announcement, whether as a result of new information, future events or otherwise, other than in accordance with their legal or regulatory obligations (including, for the avoidance of doubt, the Prospectus Regulation Rules, the Listing Rules, MAR, FSMA and Disclosure Guidance and Transparency Rules). Additionally, statements of the intentions or beliefs of the board of directors of the Company reflect the present intentions and beliefs of the board of directors of the Company as at the date of this announcement and may be subject to change as the composition of the board of directors of the Company alters, or as circumstances require.
VIDENDUM PLC
Proposed £125 million underwritten Capital Raising by way of Firm Placing and Placing and Open Offer
1. Introduction to the Capital Raising
Videndum announces today that it proposes to raise gross proceeds of approximately £125 million through a Firm Placing and Placing and Open Offer.
Pursuant to the Capital Raising, 28,122,472 New Ordinary Shares will be issued through the Firm Placing and 18,748,315 New Ordinary Shares will be issued through the Placing and Open Offer, on the basis of 2 New Ordinary Shares for every 5 Existing Ordinary Shares, in each case at the Offer Price of 267 pence per New Ordinary Share.
The Offer Price of 267 pence per New Ordinary Share represents a 3.3% discount to the Closing Price of 276 pence per Ordinary Share on 20 November 2023. The Offer Price (and the discount) has been set by the Directors following their assessment of the prevailing market conditions and anticipated demand for the New Ordinary Shares. The Board, having taken appropriate advice from its advisers, believes that the Offer Price (including the discount) is appropriate in the circumstances.
The Capital Raising is fully underwritten by Investec and Jefferies, subject to the conditions set out in the Placing Agreement.
2. Background to the Capital Raising
2.1 Company overview
Videndum is a leading global provider of premium branded hardware products and software solutions to the content creation accessory industry. The Group's brands are leaders in defensible niche markets, in terms of premium products, technology innovation and/or market share.
Customers include TV broadcasters, film studios, production and rental companies, photographers, independent content creators, vloggers/influencers, professional musicians, governments and enterprises.
Videndum designs and manufactures a portfolio of traditional mechanically engineered products through to electronics and software - to enable its customers, in a full range of creative industries, to capture and share content through a wide variety of media. Videndum's products typically attach to, or support, a camera - primarily for broadcast, cinematic, video, photographic, audio capture and smartphone applications - and are offered as a cohesive package. Its product portfolio includes: camera supports (tripods and heads), video transmission systems and monitors, live streaming solutions, smartphone accessories, robotic camera systems, prompters, LED lighting, mobile power, carrying solutions, backgrounds, motion control, audio capture, and noise reduction equipment.
2.2 Reasons for the Capital Raising
Over the past two years, several factors have combined to significantly increase the Group's leverage, defined as Consolidated Net Borrowings to EBITDA according to the terms of its lending covenants ("Leverage").
· Between April 2021 and January 2022, the Group completed four acquisitions for aggregate consideration of more than US$150 million, which were funded from debt; in the same period its Leverage increased from 1.3x at 31 December 2019 to 2.2x at 30 June 2022.
· Beginning in the second half of 2022, the Group was increasingly impacted by macroeconomic headwinds, including weakening consumer confidence, which most significantly impacted revenue from the Group's non-professional customers (c.10% of Group revenue). As interest rates increased, business confidence was impacted further towards the latter part of the second half of 2022, and this resulted in retailers and distributors commencing to destock across all divisions, but predominantly impacting the Media Solutions Division. This also began impacting the Group's independent content creator segment (c.35% of Group revenue).
· The macroeconomic environment has remained challenging throughout 2023, which has led to continued retailer and distributor destocking, compounded by the continuing weakness of the Group's consumer segment as well as its independent content creator segment. The challenging macroeconomic environment and the acquisitions by the Group increased the Group's Leverage position.
· As further set out in the Prospectus, the WGA, which combines two different US labour unions representing TV and film writers in New York and Los Angeles, called a strike on 2 May 2023. In the months prior to the strike being called, the speculation of a potential strike caused some US cine/scripted TV productions to be paused, and from 2 May 2023, the majority of US cine/scripted TV productions were suspended. This strike action significantly impacted demand for the Group's high-end cine and scripted TV products in the United States.
Substantial actions executed to help mitigate the impact of adverse macroeconomic environment and US Writers' and Actors' Strikes
Against this challenging backdrop, the Group took significant actions to mitigate the impact of the macroeconomic challenges and the US Writers' and Actors' Strikes, including agreeing covenant amendments with its lending banks, cost reductions, and developed plans to conserve cash, and reduce Leverage. The year-on-year net benefit of cost savings was £8.9 million in H1 2023.
The mitigation efforts include, but are not limited to, the following:
· La Cassa Integrazione Guadagni Ordinaria, the Italian government supported furlough programme, was applied in the Italian facilities of Media Solutions to mitigate the lower demand whilst ensuring employees were looked after and retained by the business;
· Implemented restructuring projects in all divisions to ensure a lean organisation ready to capitalise once trading conditions improve;
· Taken advantage of location synergies following recent acquisitions:
- In the United Kingdom, the Rycote windshield production was moved to the Ashby-de-la-Zouch factory;
- In the United States, audio R&D and microphones production moved to the audio centre of excellence in Portland, the manufacturing of Wooden Camera products moved from Dallas, USA to the Cartago site in Costa Rica and Videndum Media Solutions' US distribution moved out of New Jersey to the Savage facilities in Arizona; and
· Short-time working was implemented in Creative Solutions in H2 2023 to mitigate the lower demand whilst ensuring employees were retained by the business.
Notwithstanding these actions, the Group's Leverage position increased to 2.9x for the 12 months to 30 June 2023. The Group's gearing, defined as Net Debt to Equity was 86% at 31 December 2022 and increased to 139% at 30 June 2023. As Videndum outlined in its 2023 Half Year Results, given the length of the US Writers' and Actors' Strikes, the strikes are also having a significant impact in the second half of 2023, and Leverage at December 2023 will be based on EBITDA for the 12 months to 31 December 2023.
Videndum has good relationships with its lending banks and during the strikes, the Group worked constructively with its lending banks and agreed covenant amendments for December 2023 and June 2024 in August 2023, and further amended the covenants for the Test Dates falling on December 2023, March 2024, June 2024 and September 2024 in September 2023 and November 2023. The lending banks also agreed to delay the scheduled repayment of term loans of US$25 million (£20.1 million) from December 2023 to February 2024. New covenant testing dates for March 2024 and September 2024 have been agreed in addition to the customary test dates of December and June. In addition, there is a requirement for the Company to prepare an alternative deleveraging plan in a form and substance satisfactory to its lending banks by no later than 15 January 2024 if an equity raise of a minimum of £90 million net proceeds (after fees, costs and expenses) has not been launched by 30 November 2023. Moreover, during the period starting 10 November 2023 and ending 30 June 2024, the Company and the Group must seek consent from its lending banks for any new acquisitions. The launch of the Capital Raising satisfies the requirement to announce and release the Capital Raising on or before 30 November 2023, which means the Group is not required to prepare such alternative deleveraging plan.
Alongside executing cost saving and cash preservation actions (including non-recourse factoring of receivables, lower capital expenditure in fixed assets, and controlled investment in working capital) Videndum has continued to maintain investment in the Group's key strategic initiatives to seek to ensure it is well placed for recovery once productions restart. The Group is increasingly focusing on the high-end professional content creation market where it has high market share, sales channel expertise and compelling growth opportunities. Consequently, the Board has already decided to exit the non-core medical market, and has exited the non-core gaming market, to concentrate on R&D investment on the content creation market. As a result, Amimon was held for sale at 30 June 2023 and certain trade and assets of Lightstream were disposed of by the Group on 2 October 2023 for US$0.5 million.
Even though both the WGA and SAG-AFTRA have announced that they have reached agreements on new 2023 contracts (in the case of SAG-AFTRA, pending the SAG-AFTRA Members Ratification), allowing both writers and actors to return to work, the length and depth of the strikes, coupled with the macroeconomic challenges, have significantly impacted the Group. The Capital Raising will allow Videndum to reduce its borrowings and enable the Group to focus on its strategic delivery and long-term value creation as well as reducing the risk for all stakeholders from a possible breach of covenants, or a solvency risk due to a lack of liquidity.
More robust capital structure will help the Group deliver on its medium-to-long-term ambitions
Videndum believes that the Capital Raising will provide the Group with a balanced capital structure to enable the delivery of its strategy and generate future shareholder value.
The content creation market continues to have strong longer-term prospects, with structural growth drivers, and Videndum is positioned to benefit with leading, premium brands. Although the consumer and ICC segments of the market are being impacted by the current challenging macroeconomic environment, and cine/scripted TV productions were paused for over five months in the United States (and some European countries have also been affected) due to the US Writers' and Actors' Strikes, Videndum expects that the demand for, and investment in, original content (e.g. for live news and sport, reality and scripted TV shows, films, digital visual content for e-commerce and vlogging, etc.) will continue to grow in the medium term.
Videndum expects to recover from the temporary impact from the headwinds mentioned above, however the timing and shape of recovery from the strikes, and an improvement in the macroeconomic environment, is difficult to predict.
Recovery is underpinned by Videndum's clear strategy to create value with a tighter focus on its high-end, professional core markets which have attractive growth prospects. Even assuming that the macroeconomic environment remains challenging in 2024, the Group believes it has a number of building blocks to achieve its 2024 targets. These include the non-repeat of the US Writers' and Actors' Strikes, the bounce back from the strikes, less destocking, the benefit from price increases implemented in 2023, a pipeline of new product launches (including the new sustainable portable power solution), delivery of the 2024 Olympic Games contract, and the positive impact from the media coverage of the 2024 US Presidential elections.
Margin improvement is expected as volumes return, and the Group delivers operating leverage. The Group is focused on improving operating profit margins towards its long-term mid-to-high teen goal and its long-term margin improvement drivers include targeted pricing increases to reflect product quality and brand strength, growing online sales, continued operating efficiencies, and capturing synergies from recent acquisitions.
The Board believes that a reduction in Videndum's current elevated Leverage position will enable the Group to focus on strategic execution and long-term value creation and will reduce the downside risks from near-term headwinds the Group is currently experiencing and the risk of a breach of its covenants which would result in the default of its lending arrangements with its banks. This will also help to ensure that Videndum is well-positioned to benefit from a recovery in revenue once the current headwinds abate.
Whilst the Group remains focused on proactively reducing Leverage in the short term, in the medium to long term the Group has a disciplined approach to capital allocation, including considering potential divestments as well as targeted bolt-on M&A activity where there are opportunities to expand the Group's addressable markets and/or enhance its technological capabilities.
It is accordingly announcing a fully underwritten Capital Raising, subject to the conditions set out in the Placing Agreement, to raise gross proceeds of £125 million. This will provide headroom with respect to the financial debt covenants contained within the Group's Existing Senior Financial Indebtedness, strategic, and financial flexibility and it will be supported by divestment proceeds, if any, and continued cost control.
In summary, the Board believes the Capital Raising will allow Videndum to focus its resources on strategic execution and long-term value creation for shareholders from its market-leading premium brands focused on the content creation market.
3. Use of proceeds
The Capital Raising is expected to raise approximately £125 million in gross proceeds and approximately £116.7 million in net proceeds (after deduction of estimated commissions, fees, expenses and excluding VAT).
US$55 million in net proceeds is intended to fund the repayment and cancellation of the Group's outstanding term loans, which relate to the acquisitions of Savage and Audix, which as at the Latest Practicable Date had an outstanding balance of US$55 million (£44.2 million), following which £72.5 million in net proceeds is intended to be utilised to repay drawings under the Group's Revolving Credit Facility.
The Group will continue to prioritise reducing Leverage to its previous targeted range to be below 1.5x whilst also seeking to execute its strategy and maintain investment in its key strategic initiatives to drive organic growth.
4. Current trading and outlook
Since the Group's last update in the 2023 Half Year Results announced on 26 September 2023, the US Writers' and Actors' Strikes have ended (pending the SAG-AFTRA Member Ratification). However, as expected, there is significantly more impact from the US Writers' and Actors' Strikes on the Group in H2 2023 than in H1 2023.
Consistent with the trends in the first half, the macroeconomic environment remains challenging, and the Group does not anticipate a recovery in the consumer or ICC segments in 2023.
Management believes that destocking has completed in consumer retailers, however specialist distributors remain concerned about high interest rates and levels of working capital, and there is therefore still some destocking in this area, although this is expected to reduce and have a lower impact going forward. Management continues to be focused on tightly managing costs and preserving cash, while seeking to ensure that the business is well placed for recovery now that the US Writers' and Actors' Strikes have ended (pending the SAG-AFTRA Member Ratification) and once productions affected by those strikes restart. However, as a consequence of the increasing impact of the strikes and the challenging macroeconomic environment, the Group experienced a further weakening in trading in the third quarter, particularly with respect to Creative Solutions, and to a lesser extent Production Solutions, which have the most exposure to the cine/scripted TV segment. This resulted in an increase in Leverage from 2.9x as at 30 June 2023 to 4.2x as at 30 September 2023.
On 2 October 2023, certain trade and assets of Lightstream were sold to Xsolla (USA), Inc., a leading player in the gaming industry, for US$0.5 million.
Videndum remains well positioned in a content creation market which has attractive structural growth drivers and strong medium-term prospects. Now that the US Writers' and Actors' Strikes have ended (pending the SAG-AFTRA Member Ratification) and once productions affected by those strikes restart, the Board is confident that the Group will benefit from a significant recovery in its cine revenue.
5. Risk factors and further information
Shareholders should consider fully and carefully the risk factors associated with Videndum, as set out in the Prospectus.
Shareholders should read the whole of the Prospectus and not rely solely on the information set out in this announcement.
6. Principal terms and conditions of the Capital Raising
The Company proposes to raise gross proceeds of approximately £125 million (approximately £116.7 million after deduction of estimated commissions, fees, expenses and excluding VAT) by way of:
· a Firm Placing of 28,122,472 New Ordinary Shares; and
· a Placing and Open Offer of 18,748,315 New Ordinary Shares,
in each case at an Offer Price of 267 pence per New Ordinary Share. The New Ordinary Shares will, when issued and fully paid, rank pari passu in all respects with the Existing Ordinary Shares.
The Capital Raising is being fully underwritten by the Joint Bookrunners on, and subject to, the terms and conditions of the Placing Agreement. The Capital Raising is conditional on, among other things, the Resolutions having been passed by Shareholders at the General Meeting.
The Board has considered the best way to structure the proposed equity Capital Raising in light of the Group's current financial position and the interests of all Shareholders. The decision to structure the equity Capital Raising by way of a combination of a Firm Placing and a Placing and Open Offer takes into account a number of factors, including the total net proceeds to be raised pursuant to the Capital Raising and the possibility to widen the Company's shareholder base with new investors in the Company. The Board also believes that the Firm Placing could enable the Company to satisfy demand from current major Shareholders wishing to increase their equity positions in the Company. The Board has sought to balance the dilution to existing Shareholders arising from the Firm Placing with the need to bring in substantial investors with guaranteed commitments to ensure the success of the Capital Raising. As a result 39.6% of the New Ordinary Shares being issued will be available to existing Shareholders through the Open Offer on a pro rata basis.
Further details of the terms and conditions of the Capital Raising, including the procedure for acceptance and payment and the procedure in respect of rights not taken up, will be set out in the Prospectus and, where relevant, the Application Form.
Offer Price
The Offer Price of 267 pence per New Ordinary Share represents a 3.3% discount to the Closing Price of 276 pence per Ordinary Share on 20 November 2023. The Offer Price (and the discount) has been set by the Directors following their assessment of the prevailing market conditions and anticipated demand for the New Ordinary Shares. The Board, having taken appropriate advice from its advisors, believes that the Offer Price (including the discount) is appropriate in the circumstances.
Firm Placing
The Company proposes to issue 28,122,472 Firm Placing Shares to Firm Placees at the Offer Price, on a non-pre-emptive basis. The Firm Placing will not be subject to clawback to satisfy Open Offer Entitlements taken up by Qualifying Shareholders.
Placing and Open Offer
Under the Open Offer, Qualifying Shareholders are being given the opportunity to subscribe for New Ordinary Shares pro rata to their current holdings on the basis of 2 New Ordinary Shares for every 5 Existing Ordinary Shares held by them on the Record Date, and so in proportion to any other number of Existing Ordinary Shares then held and otherwise on the terms and conditions set out in this document (and, in the case of Qualifying Non-CREST Shareholders, the Application Form).
Qualifying Shareholders may apply for any whole number of Open Offer Shares up to their Open Offer Entitlements. Fractions of Open Offer Shares will not be allotted and each Qualifying Shareholder's Open Offer Entitlements will be rounded down to the nearest whole number. The fractional entitlements will be aggregated and sold for the benefit of the Company under the Placing. Accordingly, Qualifying Shareholders with fewer than 5 Existing Ordinary Shares will not be entitled to take up any Open Offer Shares. Holdings of Existing Ordinary Shares in certificated and uncertificated form will be treated as separate holdings for the purpose of calculating Open Offer Entitlements.
The Joint Bookrunners have agreed severally, subject to the certain terms and conditions of the Placing Agreement, to use reasonable endeavours to procure Placees for the New Ordinary Shares at the Offer Price. To the extent that any Firm Placee or Placee procured by the Joint Bookrunners fails to subscribe for any or all of the Firm Placing Shares and/or Placing Shares which have been allocated to it, subject to certain conditions, each of the Joint Bookrunners shall severally subscribe themselves for the Firm Placing Shares and/or the Placing Shares at the Offer Price.
Director and Senior Management Subscriptions
Each of the Directors and certain of the Senior Managers have committed to subscribe for New Ordinary Shares, at the Offer Price, in connection with the Capital Raising pursuant to direct subscription agreements with the Company (conditional upon Admission). In aggregate, 459,167 New Ordinary Shares are expected to be issued by the Company in connection with the Director and Senior Management Subscriptions and the Company will raise additional proceeds of approximately £1,226,000 (gross).
Impact of not applying for New Ordinary Shares
Any New Ordinary Shares which are not applied for under the Open Offer will be allocated to Conditional Placees pursuant to the Placing. Pursuant to the Placing Agreement, the Joint Bookrunners have severally agreed to use reasonable endeavours to procure conditional subscribers (subject to clawback to satisfy Open Offer Entitlements taken up by Qualifying Shareholders) for the New Ordinary Shares at the Offer Price. If the Joint Bookrunners are unable to procure subscribers for any New Ordinary Shares that are not taken up by Qualifying Shareholders pursuant to the Open Offer (including in the event that a prospective Conditional Placee fails to take up any or all of the Firm Placing Shares which have been allocated to it or which it has agreed to take up at the Offer Price), then each of the Joint Bookrunners has agreed, on the terms and subject to the conditions set out in the Placing Agreement, severally (and not jointly or jointly and severally) to subscribe for such New Ordinary Shares at the Offer Price in its Due Underwriting Proportions.
Shareholders should be aware that the Open Offer is not a rights issue. As such, Qualifying Non-CREST Shareholders should note that their Application Forms are not negotiable documents and cannot be traded. Qualifying CREST Shareholders should note that, although the Open Offer Entitlements will be admitted to CREST, and be enabled for settlement, the Open Offer Entitlements will not be tradeable or listed and applications in respect of the Open Offer may only be made by the Qualifying Shareholder originally entitled or by a person entitled by virtue of a bona fide market claim. New Ordinary Shares for which application has not been made under the Open Offer will not be sold in the market for the benefit of those who do not apply under the Open Offer and Qualifying Shareholders who do not apply to take up their entitlements will have no rights, and will not receive any benefit, under the Open Offer. Any Open Offer Shares which are not applied for under the Open Offer will be allocated to Conditional Placees pursuant to the Placing.
Dilution
If a Qualifying Shareholder who is not a Placee does not take up any of their Open Offer Entitlements, such Qualifying Shareholder's holding, as a percentage of the Enlarged Share Capital, will be diluted by 50.2% as a result of the Capital Raising and the Director and Senior Management Subscriptions.
If a Qualifying Shareholder who is not a Placee takes up their Open Offer Entitlements in full, such Qualifying Shareholder's holding, as a percentage of Enlarged Share Capital, will be diluted by 30.3% as a result of the Firm Placing and the Director and Senior Management Subscriptions.
Shareholders in the United States (subject to certain limited exceptions) and the other Excluded Territories will not be able to participate in the Open Offer and will therefore experience dilution as a result of the Capital Raising and the Director and Senior Management Subscriptions.
Conditionality
The Capital Raising is conditional, among other things, upon:
· the passing of the Resolutions at the General Meeting without material amendment;
· Admission of the New Ordinary Shares becoming effective by not later than 8.00 a.m. on 8 December 2023 (or such later time and/or date as the Joint Bookrunners and the Company may agree in advance in writing); and
· the Placing Agreement becoming unconditional in all respects (save for the condition relating to Admission) and not having been rescinded or terminated in accordance with its terms prior to Admission.
If any of the conditions are not satisfied or, if applicable, waived, then the Capital Raising will not take place.
Application will be made for the New Ordinary Shares to be admitted to listing on the premium segment of the Official List and to trading on the London Stock Exchange's main market for listed securities. It is expected that Admission will become effective and dealings in the New Ordinary Shares fully paid will commence at 8.00 a.m. on 8 December 2023.
7. Significant Commitments And Related Party Transactions
Significant commitments
The Company has received an irrevocable undertaking from Alantra confirming its intention to vote in favour of the Resolutions at the General Meeting, in respect of an aggregate of 9,908,153 Existing Ordinary Shares, representing approximately 21.1% of the Existing Ordinary Shares as at the Latest Practicable Date.
The Company has also received an irrevocable undertaking from Aberforth confirming its intention to vote in favour of the Resolutions at the General Meeting, in respect of an aggregate of 4,469,760 Existing Ordinary Shares, representing approximately 9.54% of the Existing Ordinary Shares as at the Latest Practicable Date.
Related Party Transactions
Each Director is a related party of the Company for the purposes of the Listing Rules. The subscriptions by the Directors pursuant to the Director and Senior Management Subscriptions are exempt in each case from the rules regarding related party transactions under chapter 11 of the Listing Rules due to the size of each Director and Senior Management Subscription relative to the Company's market capitalisation. None of the Directors intend to take part in either the Firm Placing or the Placing and Open Offer.
8. General Meeting
A notice convening a general meeting of the Company to be held at 10:30 a.m. on 7 December 2023 at 41 Portland Place, London, W1B 1QH is set out at the end of the Prospectus, which is expected to be published on 21 November 2023. The purpose of the General Meeting is to seek Shareholders' approval for the Resolutions, summarised as follows:
(A) Resolution 1 (ordinary resolution): that pursuant to section 551 of the Companies Act, the Directors are authorised until the conclusion of the next annual general meeting of the Company to: (i) allot shares up to an aggregate nominal amount of £9,465,991, representing approximately 101.0% of the Company's current issued share capital as at the Latest Practicable Date, pursuant to or in connection with the Capital Raising; and (ii) make an offer or agreement in connection with the Capital Raising which would or might require shares to be allotted after expiry of this allotment authority;
(B) Resolution 2 (ordinary resolution): that the Directors are authorised until the conclusion of the next annual general meeting of the Company to allot up to 47,329,954 New Ordinary Shares pursuant to the Capital Raising at an issue price of 267 pence, which is at a 3.3% discount to the Closing Price at 20 November 2023 and otherwise on the terms set out in the Prospectus;
(C) Resolution 3 (ordinary resolution): that any issuance of New Ordinary Shares to an existing Shareholder which constitutes a related party transaction for the purposes of paragraph 11.1.7R of the Listing Rules be approved; and
(D) Resolution 4 (special resolution): that pre-emption rights are disapplied up to an aggregate nominal amount of £9,465,991, representing approximately 101.1% of the Company's current issued share capital as at the Latest Practicable Date, pursuant to or in connection with the Capital Raising, subject to such exclusions or other arrangements as the directors of the Company may deem necessary or expedient in relation to fractional entitlements or legal or practical problems.
The full text of the Resolutions is set out in the Notice of General Meeting in the Prospectus, which is expected to be published on 21 November 2023. Voting on the Resolutions will be conducted by way of a poll and not by a show of hands.
As at today's date, the Company holds no Ordinary Shares in treasury.
9. Action to be taken
Full details of the terms and conditions of the Capital Raising and the procedure for application and payment will be set out in the Prospectus, which is expected to be published on 21 November 2023. If Shareholders are in any doubt as to the action they should take, they are recommended to seek their own personal financial advice immediately from their stockbroker, bank manager, solicitor, accountant, fund manager or other independent financial adviser authorised under FSMA if they are in the United Kingdom or, if they are not, from another appropriately authorised independent financial adviser.
10. Directors' intentions
Each of the Directors has committed to subscribe for New Ordinary Shares, at the Offer Price, in connection with the Capital Raising pursuant to the Director and Senior Manager Subscriptions, as set out in the following table:
| Name | Existing Ordinary Shares beneficially held (as at the Latest Practicable Date) | Total investment in New Ordinary Shares pursuant to the Director and Senior Management Subscriptions (£) |
| Ian McHoul | 20,000 | 50,000 |
| Stephen Bird | 235,477 | 250,000 |
| Andrea Rigamonti | 9,706 | 100,000 |
| Anna Vikström Persson | 0 | 70,000 |
| Caroline Thomson | 8,407 | 20,000 |
| Dr Erika Schraner | 3,805 | 10,000 |
| Graham Oldroyd(1) | 0 | 100,000 |
| Teté Soto | 1,691 | 10,000 |
| Richard Tyson | 2,654 | 10,000 |
| Stephen Harris | 0 | 300,000 |
| (1) Graham Oldroyd will hold the New Ordinary Shares issued pursuant to the Director and Senior Manager Subscriptions jointly with his spouse. | ||
11. Dividends and dividend policy
Reflecting the impact of the US Writers' and Actors' Strikes and the challenging macroeconomic conditions have had on the financial performance of the Group and its Leverage, Videndum did not declare a dividend at its 2023 Half Year Results.
The Board recognises the importance of dividends to the Group's shareholders and intends to resume payment of a progressive and sustainable dividend when it is appropriate to do so.
12. Directors' intentions and recommendation
The Board considers that the Capital Raising is in the best interests of the Shareholders of the Company taken as a whole and unanimously recommends that shareholders vote in favour of the Resolutions to be proposed at the General Meeting, as the Directors who hold Existing Ordinary Shares intend to do in respect of their own beneficial holdings.
In addition, each of the Directors has committed to subscribe for New Ordinary Shares, at the Offer Price, in connection with the Capital Raising pursuant to the Director and Senior Manager Subscriptions, as set out in paragraph 10 of this announcement.
APPENDIX I
DEFINITIONS
| "2023 Half Year Results" | means the means the announcement of the Company's results for the six months ended 30 June 2023 made on 26 September 2023, which includes the unaudited condensed consolidated interim financial statements of the Group as at and for the six months ended 30 June 2023 and the unaudited comparative financial information as at and for the six months ended 30 June 2022; |
| "Aberforth" | means Aberforth Partners LLP; |
| "Admission" | means admission of the New Ordinary Shares to the premium listing segment of the Official List and to trading on the main market for listed securities of the London Stock Exchange; |
| "Alantra" | means Alantra EQMC Asset Management; |
| "Amimon" | Amimon Limited, incorporated in Israel; |
| "Application Form" | means the personalised application form on which Qualifying Non-CREST Shareholders may apply for New Ordinary Shares under the Open Offer; |
| "Audix" | means Audix LLC, organised in the United States and/or if the context requires, means the "audix" trademark; |
| "Audix Term Loan" | means the term loan entered into on 7 January 2022, as amended by an amendment letter dated 3 August 2023, an amendment letter dated 25 September 2023 and an amendment letter dated 10 November 2023 between, among others, the Company (as borrower), Citibank, N.A., London Branch, National Westminster Bank Plc, UniCredit Bank AG, London Branch, Wells Fargo Bank, N.A., London Branch (each as original lenders) and Citibank Europe plc, UK Branch (as agent); |
| "Board" | means the board of directors of the Company from time to time; |
| "Business Day" | means any day on which banks are generally open in London for the transaction of business other than a Saturday or Sunday or public holiday; |
| "Capital Raising" | means the Firm Placing and the Placing and Open Offer; |
| "CCSS" | means the CREST Courier and Sorting Service established by Euroclear UK to facilitate, amongst other things, the deposit and withdrawal of securities has the meaning given to it in the CREST Manual; |
| "certificated" or "in certificated form" | refers to a share or other security which is not in uncertificated form (that is, not in CREST); |
| "Chair" | means the Chair of the Company; |
| "Closing Price" | means the closing, middle market quotation of an Existing Ordinary Share, as derived from Bloomberg; |
| "Companies Act" | means the Companies Act 2006 of England and Wales, as amended, modified or re-enacted from time to time; |
| "Company" or "Videndum" | Videndum plc, a public limited company incorporated in England and Wales with registered number 00227691; |
| "Conditional Placee" | means any person who agrees to conditionally subscribe for Open Offer Shares (subject to clawback to satisfy Open Offer Entitlements taken up by Qualifying Shareholders) pursuant to the Placing; |
| "Consolidated Gross Borrowings" | means at any time the aggregate (without double counting and excluding any amount owed to another member of the Group) of the following: (A) the outstanding principal amount of any moneys borrowed by any member of the Group and any outstanding overdraft debit balance of any member of the Group;(B) the outstanding principal amount of any debenture, bond, note, loan stock or other security of any member of the Group;(C) the outstanding principal amount of any acceptance under any acceptance credit opened by a bank or other financial institution in favour of any member of the Group;(D) the outstanding principal amount of all moneys owing to a member of the Group in connection with the sale or discounting of receivables (otherwise than on a non-recourse basis); and(E) the capitalised element of indebtedness of any member of the Group in respect of any lease or hire purchase contract (excluding trade accounts arising in the normal course of trading);the outstanding principal amount of any indebtedness of any person of a type referred to in sub-paragraphs (A) to (E) above which is the subject of a guarantee, indemnity or similar assurance against financial loss given by any member of the Group; |
| "Consolidated Net Borrowings" | means the aggregate amount of all Consolidated Gross Borrowings less cash at bank and cash equivalent investments, as determined from the most recently published annual or semi-annual consolidated financial statements of the Group; |
| "Creative Solutions" or "Creative Solutions Division" | means the division of Videndum entitled "Creative Solutions"; |
| "CREST" | means the system for the paperless settlement of trades in securities and the holding of uncertificated securities in accordance with the CREST Regulations operated by Euroclear UK; |
| "CREST Manual" | means the rules governing the operation of CREST, consisting of the CREST Reference Manual, CREST International Manual, CREST Central Counterparty Service Manual, CREST Rules, Registrars Service Standards, Settlement Discipline Rules, CREST CCSS Operations Manual, Daily Timetable, CREST Application Procedure and CREST Glossary of Terms (all as defined in the CREST Glossary of Terms promulgated by Euroclear on 15 July 1996, as amended); |
| "CREST member" | means a person a person who has been admitted by Euroclear UK as a system member of CREST; |
| "CREST Regulations" | means the Uncertificated Securities Regulations 2001 (SI 2001 No. 3755), as amended from time to time; |
| "CREST sponsor" | means a CREST participant admitted to CREST as a CREST sponsor; |
| "Daily Official List" | means the daily official list of the London Stock Exchange; |
| "Directors" | means the directors of the Company as at the date of this document, and "Director" means any one of them; |
| "Director and Senior Management Subscriptions" | means the subscription by each of the Directors and certain members of the Senior Managers for New Ordinary Shares at the Offer Price, in connection with the Capital Raising pursuant to direct subscription agreements with the Company (conditional upon Admission); |
| "Disclosure Guidance and Transparency Rules" | means the disclosure guidance and transparency rules made under Part VI of FSMA (as set out in the FCA Handbook), as amended; |
| "Division" | means any or a combination of the following: Creative Solutions Division, Media Solutions Division and Production Solutions Divisions; |
| "Due Underwriting Proportions" | means in the case of Jefferies, 50%, and in the case of Investec, 50%; |
| "EBITDA" | means, for any period, the earnings before interest, taxes, depreciation, and amortisation of the Group (including the 12 month pro forma effect of any acquisitions or disposals made in the period in the case of acquisitions, applying the same accounting principles as if the acquired company was already part of the Group), after adding back all depreciation; |
| "EEA" | means the European Economic Area first established by the agreement signed at Oporto on 2 May 1992; |
| "Enlarged Share Capital" | means the expected issued ordinary share capital of the Company immediately following the issue of the New Ordinary Shares; |
| "Equity" | means the total of the share capital, share premium, translation reserve, capital redemption reserve, cash flow hedging reserve and retained earnings of the Group; |
| "EU" or "European Union" | means the European Union first established by the treaty made at Maastricht on 7 February 1992; |
| "Euroclear UK" | means Euroclear UK & International Limited, the operator of CREST; |
| "Excluded Territories" | means Australia, Canada, Switzerland, South Korea, Israel, Singapore, South Africa, Japan and the United States (subject to certain limited exceptions), and any other jurisdiction where the extension or availability of the Capital Raising (and any other transaction contemplated thereby) would breach any applicable law or regulation and "Excluded Territory" means any one of them; |
| "Existing Ordinary Shares" | means, the existing Ordinary Shares in issue immediately preceding the Capital Raising; |
| "Existing Senior Financial Indebtedness" | means the Group's current senior financial indebtedness, which comprises of: (i) a £200 million Revolving Credit Facility, of which £156 million was drawn as at 30 June 2023; (ii) a US$53 million Savage Term Loan, of which £22.9 million was outstanding as at 30 June 2023; and (iii) a US$47 million Audix Term Loan; |
| "Ex-Entitlements Date" | means the date on which the New Ordinary Shares are expected to commence trading ex-entitlements, being 8.00 a.m. on 21 November 2023; |
| "FCA" | means the Financial Conduct Authority; |
| "FCA Handbook" | means the FCA's Handbook of Rules and Guidance, as amended from time to time; |
| "Financial Debt Covenants" | means the financial debt covenants contained within the Group's Existing Senior Financial Indebtedness; |
| "Firm Placee" | means any person that has conditionally agreed to subscribe for Firm Placing Shares; |
| "Firm Placing" | means the conditional placing of the Firm Placing Shares on the terms and subject to the conditions contained in the Placing Agreement; |
| "Firm Placing Shares" | means the 28,122,472 New Ordinary Shares which are to be issued by the Company pursuant to the Firm Placing; |
| "Form of Proxy" | means the form of proxy for use at the General Meeting which accompanies this document; |
| "FSMA" | means the Financial Services and Markets Act 2000 of England and Wales, as amended from time to time; |
| "General Meeting" | means the general meeting of the Company to be convened to be held at 41 Portland Place, London, W1B 1QH at 10.30 a.m. (London time) on 7 December; |
| "Group" | means the Company and each of its direct and indirect subsidiaries from time to time (where "subsidiary" shall have the meaning ascribed to it in the Companies Act); |
| "ICC" | independent content creators; |
| "Joint Bookrunners" | means Jefferies International Limited and Investec Bank plc; |
| "Joint Global Co-ordinators" | means Jefferies International Limited and Investec Bank plc; |
| "Latest Practicable Date" | means 17 November 2023, being the latest practicable date prior to publication of this Announcement; |
| "Leverage" | means Consolidated Net Borrowings to EBITDA according to the terms of the Group's lending covenants; |
| "Lightstream" | means the entire issued share capital of Infiniscene Inc.; |
| "London Stock Exchange" | means London Stock Exchange Group plc or its successor(s); |
| "MAR" | means Regulation (EU) No 596/2014 of the European Parliament and of the Council of 16 April 2014 on market abuse, in the form retained in the English law and as amended from time to time; |
| "Media Solutions" or "Media Solutions Division" | means the division of Videndum entitled "Media Solutions"; |
| "Net Debt" | means the net debt of the Group comprising of: (i) cash and cash equivalents (cash on hand and demand deposits at banks); (ii) bank overdrafts that are payable on demand; (iii) interest-bearing loans and borrowings; and (iv) lease liabilities; |
| "New Ordinary Shares" | means the Ordinary Shares to be issued by the Company pursuant to the Capital Raising and the Director and Senior Management Subscriptions; |
| "Notice" | means the notice of the General Meeting contained in the Prospectus; |
| "Offer Price" | means 267 pence per New Ordinary Share; |
| "Official List" | means the official list maintained by the FCA pursuant to FSMA; |
| "Open Offer" | means the conditional invitation to Qualifying Shareholders to apply to subscribe for the Open Offer Shares at the Offer Price on the terms and subject to the conditions set out in this document and, in the case of Qualifying Non-CREST Shareholders only, the Application Form; |
| "Open Offer Entitlements" | means entitlements to subscribe for Open Offer Shares allocated to a Qualifying Shareholder pursuant to the Open Offer; |
| "Open Offer Shares" | means 18,748,315 New Ordinary Shares which are to be issued by the Company pursuant to the Open Offer; |
| "Ordinary Shares" | means the ordinary shares of 20 pence each in the share capital of the Company; |
| "Placee" | means a Conditional Placee or a Firm Placee; |
| "Placing" | means the conditional placing of the Open Offer Shares, subject to clawback pursuant to the Open Offer, on the terms and subject to the conditions contained in the Placing Agreement; |
| "Placing Agreement" | means the agreement entered into by the Company and the Joint Bookrunners, pursuant to which the Company has appointed Jefferies and Investec as Joint Global Co-ordinators and Joint Bookrunners in connection with the Capital Raising, and Rothschild & Co as Sponsor in connection with Admission; |
| "Placing Shares" | means the Open Offer Shares proposed to be issued by the Company pursuant to the Placing (to the extent that such shares have not been validly taken up pursuant to the Open Offer); |
| "Production Solutions" or "Production Solutions Division" | means the division of Videndum entitled "Production Solutions"; |
| "Prospectus Regulation Rules" | means the Prospectus Regulation Rules of the FCA made under section 73A of FSMA; |
| "Qualifying CREST Shareholders" | means Qualifying Shareholders holding Ordinary Shares in uncertificated form; |
| "Qualifying Non-CREST Shareholders" | means Qualifying Shareholders holding Ordinary Shares in certificated form; |
| "Qualifying Shareholders" | means holders of Existing Ordinary Shares on the register of members of the Company at the Record Date; |
| "R&D" | means research and development; |
| "Record Date" | means 6.00 p.m. (London time) on 17 November 2023 which is the date on which a Shareholder must hold Ordinary Shares to be a Qualifying Shareholder; |
| "Regulation S" | means Regulation S under the US Securities Act; |
| "Related Party Transaction" | has the meaning ascribed to it in paragraph 9 of IAS 24, being the standard adopted according to Regulation (EC) No. 1606/2002; |
| "Resolutions" | means each of the resolutions to be proposed at the General Meeting; |
| "Revolving Credit Facility" | means a multi-currency £200,000,000 Revolving Credit Facility originally dated 5 July 2016 as amended and restated on 12 November 2021 and as amended by an amendment letter dated 3 August 2023, an amendment letter dated 25 September 2023 and an amendment letter dated 10 November 2023; |
| "Risk Factors" | means risk factors relating to the investment in the New Ordinary Shares pursuant to the Capital Raising, including: (i) risks relating to the Group's business; (ii) risks relating to the Group's industry; (iii) risks relating to regulation and legislation and (iv) risks relating to the Capital Raising and the shares; |
| "Rule 144A" | means Rule 144A under the US Securities Act; |
| "Rycote" | means the "rycote" trademark; |
| "SAG-AFTRA" | means the Screen Actors Guild-American Federation of Television and Radio Artists which went on strike in July 2023; |
| "SAG-AFTRA Member Ratification" | means the ratification by SAG-AFTRA members at a vote to be held on 5 December 2023 to confirm the new contract reached with AMPTP for its members; |
| "Savage" | means the entire issued share capital of Savage Universal Corp. and Superior Paper Specialties, LLC; |
| "Savage Term Loan" | means the term loan entered into on 15 November 2021, as amended by an amendment letter dated 3 August 2023, an amendment letter dated 25 September 2023 and an amendment letter dated 10 November 2023 between, among others, the Company (as borrower), Citibank, N.A., London Branch, National Westminster Bank Plc, UniCredit Bank AG, London Branch, Wells Fargo Bank, N.A., London Branch (each as original lenders) and Citibank Europe plc, UK Branch (as agent); |
| "Senior Managers" | means the Senior Managers of the Group, including Marco Pezzana (Group Chief Operating Officer & Divisional CEO, Media Solutions), Nicola Dal Toso (Divisional CEO, Production Solutions), Marco Vidali (Divisional CEO, Creative Solutions), Jon Bolton (Group Company Secretary and HR Director), Jennifer Shaw (Group Communications Director) and Fred Fellmeth (Group General Counsel); |
| "Shareholders" | means the holder(s) of Ordinary Shares from time to time and "Shareholder" means any one of them; |
| "Sponsor" | means N.M. Rothschild & Sons Limited; |
| "stock account" | means an account within a member account in CREST to which a holding of a particular share or other security in CREST is credited; |
| "Tax" | means any tax, levy, impost, duty or other charge or withholding of a similar nature (including any penalty or interest payable in connection with any failure to pay or any delay in paying any of the same); |
| "Test Date" | means: (A) each date in each year which is the Company's accounting reference date and the date falling six months thereafter, being, as at the date of this Prospectus, 31 December and 30 June; and(B) 31 March 2024 and 30 September 2024; |
| "uncertificated" or "in uncertificated form" | refers to a share or other security recorded on the relevant register of the share or security concerned as being held in uncertificated form in CREST and title to which, by virtue of the CREST Regulations, may be transferred by means of CREST; |
| "United Kingdom" or "UK" | means the United Kingdom of Great Britain and Northern Ireland; |
| "United States" or "US" | means the United States of America, its territories and possessions, any state of the United States and the District of Columbia; |
| "US Securities Act" | means the US Securities Act of 1933, as amended; |
| "US Writers' and Actors' Strikes" | means the strike entered into by the WGA and SAG-AFTRA in May and July 2023 respectively; |
| "VAT" | means:(A) any value added tax imposed by Value Added Tax Act 1994 and legislation and regulations supplemental thereto;(B) to the extent not included in paragraph (A) above, any Tax imposed in compliance with the council directive of 28 November 2006 on the common system of value added tax (EC Directive 2006/112); and(C) any other Tax of a similar nature to the Taxes referred to in paragraph (A) or paragraph (B) above, whether imposed in the UK or a member state of the EU in substitution for, or levied in addition to, the Taxes referred to in paragraph (A) or paragraph (B) above or imposed elsewhere; |
| "Wooden Camera" | means Wooden Camera, Inc, organised in the United States and/or if the context requires, means the "wooden camera" trademark; and |
| "Writers Guild of America" or "WGA" | means the Writers Guild of America which went on strike in May 2023. |
APPENDIX II
TERMS AND CONDITIONS OF THE PLACING
IMPORTANT INFORMATION ON THE FIRM PLACING AND PLACING
FOR INVITED PLACEES ONLY
MEMBERS OF THE PUBLIC ARE NOT ELIGIBLE TO TAKE PART IN THE FIRM PLACING (THE "FIRM PLACING") OF NEW ORDINARY SHARES IN VIDENDUM PLC (THE "COMPANY") OR THE PLACING OF NEW ORDINARY SHARES IN THE COMPANY SUBJECT TO CLAWBACK (THE "CONDITIONAL PLACING" AND TOGETHER WITH THE FIRM PLACING, THE "PLACINGS") IN RESPECT OF VALID APPLICATIONS BY QUALIFYING SHAREHOLDERS PURSUANT TO THE OPEN OFFER (THE "OPEN OFFER", AND TOGETHER WITH THE PLACINGS, THE "CAPITAL RAISING"). THE TERMS AND CONDITIONS SET OUT HEREIN ARE FOR INFORMATION PURPOSES ONLY AND ARE ONLY DIRECTED AT, AND BEING DISTRIBUTED TO: (A) IF IN A MEMBER STATE OF THE EUROPEAN ECONOMIC AREA ("EEA"), PERSONS WHO ARE QUALIFIED INVESTORS WITHIN THE MEANING OF ARTICLE 2(E) OF REGULATION (EU) 2017/1129 (THE "EU PROSPECTUS REGULATION") ("QUALIFIED INVESTORS"); (B) IF IN THE UNITED KINGDOM, PERSONS WHO ARE QUALIFIED INVESTORS WITHIN THE MEANING OF ARTICLE 2(E) OF THE EU PROSPECTUS REGULATION AS IT FORMS PART OF RETAINED EU LAW AS DEFINED IN THE EU (WITHDRAWAL) ACT 2018 (THE "UK PROSPECTUS REGULATION") AND FALL WITHIN THE DEFINITION OF "INVESTMENT PROFESSIONALS" IN ARTICLE 19(5) OF THE FINANCIAL SERVICES AND MARKETS ACT 2000 (FINANCIAL PROMOTION) ORDER 2005, AS AMENDED (THE "ORDER") OR ARE PERSONS FALLING WITHIN ARTICLE 49(2) OF THE ORDER AND WHO ARE QUALIFIED INVESTORS; OR (C) ANY OTHER PERSONS TO WHOM IT MAY OTHERWISE LAWFULLY BE COMMUNICATED; AND, IN EACH CASE, HAVE BEEN INVITED TO PARTICIPATE IN THE FIRM PLACING AND/OR THE CONDITIONAL PLACING BY THE JOINT BOOKRUNNERS (ALL SUCH PERSONS TOGETHER BEING REFERRED TO AS "RELEVANT PERSONS").
THE TERMS AND CONDITIONS SET OUT HEREIN MUST NOT BE ACTED ON OR RELIED ON BY PERSONS WHO ARE NOT RELEVANT PERSONS. ANY PERSON WHO HAS RECEIVED OR IS DISTRIBUTING THESE TERMS AND CONDITIONS MUST SATISFY THEMSELVES THAT IT IS LAWFUL TO DO SO. ANY INVESTMENT OR INVSTMENT ACTIVITY TO WHICH THESE TERMS AND CONDITIONS RELATE IS AVAILABLE ONLY TO RELEVANT PERSONS AND WILL BE ENGAGED IN ONLY WITH RELEVANT PERSONS. THESE TERMS AND CONDITIONS DO NOT THEMSELVES CONSTITUTE AN OFFER FOR SALE OR SUBSCRIPTION OF ANY SECURITIES IN THE COMPANY.
THE SECURITIES REFERRED TO HEREIN HAVE NOT BEEN AND WILL NOT BE REGISTERED UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT") OR THE SECURITIES LAWS OF ANY STATE OR OTHER JURISDICTION OF THE UNITED STATES AND THE SECURITIES MAY NOT BE OFFERED, SOLD, TRANSFERRED OR DELIVERED, DIRECTLY OR INDIRECTLY IN, INTO OR WITHIN THE UNITED STATES, EXCEPT PURSUANT TO AN EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND IN COMPLIANCE WITH ANY APPLICABLE SECURITIES LAWS OF ANY STATE OR OTHER JURISDICTION OF THE UNITED STATES. THERE HAS NOT BEEN AND WILL NOT BE A PUBLIC OFFERING OF THE SECURITIES IN THE UNITED STATES.
EACH PLACEE (AS SUCH TERM IS DEFINED BELOW) SHOULD CONSULT WITH ITS OWN ADVISERS AS TO LEGAL, TAX, BUSINESS AND RELATED ASPECTS OF AN ACQUISITION OF PLACING SHARES (AS SUCH TERM IS DEFINED BELOW).
Unless otherwise defined in these terms and conditions, capitalised terms used in these terms and conditions shall have the meaning given to them in this announcement or in the preliminary circular and prospectus dated 14 November 2023 prepared by, and relating to, the Company (the "Preliminary Prospectus") in connection with the offer of New Ordinary Shares to be issued by the Company in connection with the Capital Raising. The Preliminary Prospectus has not been approved by the Financial Conduct Authority (the "FCA") under section 87A of the Financial Services and Markets Act 2000 (as amended) ("FSMA") or otherwise.
In connection with the Capital Raising and Admission, the final approved combined circular and prospectus (the "Prospectus") prepared by, and relating to, the Company is expected to be dated on or around 21 November 2023. The Prospectus will, subject to approval by the FCA, be published on the Company's website and made available to you and will be despatched by the Company to its Shareholders (other than those who have elected or have deemed to have elected to receive soft copy, e-mail notifications or postal notifications of the publication of documents). The Prospectus is not expected to be approved and published prior to Placees entering into a legally binding commitment in respect of the Firm Placing or Conditional Placing with the Joint Bookrunners, as agents of and on behalf of the Company. As such, any commitments made under the Firm Placing and/or the Conditional Placing will be on the basis of the Preliminary Prospectus and this announcement and the terms and conditions in this Appendix.
The Firm Placing will consist of an offer of New Ordinary Shares (the "Firm Placing Shares") by way of a placing with institutional investors. The Conditional Placing will consist of an offer of New Ordinary Shares by way of a placing with institutional investors subject to clawback by Qualifying Shareholders pursuant to the Open Offer (the "Conditional Placing Shares" and together with the Firm Placing Shares, the "Placing Shares"). If a person indicates to the Joint Bookrunners that it wishes to participate in the Firm Placing and/or Conditional Placing by making an oral or written offer to acquire Firm Placing Shares pursuant to the terms of the Firm Placing and/or Conditional Placing Shares pursuant to the terms of the Conditional Placing (each such person, a "Placee"), such person will be deemed: (i) to have read and understood in their entirety these terms and conditions in this Appendix and the announcement of which it forms part and the Preliminary Prospectus; (ii) to be participating and making such offer on the terms and conditions contained in this Appendix; and (iii) to be providing the representations, warranties, indemnities, agreements, undertakings, acknowledgements and confirmations contained in these terms and conditions in this Appendix.
In particular, each Placee represents, warrants and acknowledges that:
1. it is a Relevant Person and undertakes that it will acquire, hold, manage and dispose of any of the Placing Shares that are allocated to it for the purposes of its business only;
2. in the case of any Placing Shares subscribed for by it as a financial intermediary as that term is used in Article 5(1) of the EU Prospectus Regulation or the UK Prospectus Regulation (as applicable), if in a member state of the EEA or the UK, that: (i) the Placing Shares acquired by and/or subscribed for by it in the Placings will not be acquired and/or subscribed for on a nondiscretionary basis on behalf of, nor will they be acquired or subscribed for with a view to their offer or resale to, persons in a member state of the EEA or the UK (as applicable) other than Qualified Investors (as such term is defined in either the EU Prospectus Regulation or the UK Prospectus Regulation (as applicable)), or in circumstances which may give rise to an offer of securities to the public other than an offer or resale, in a member state of the EEA which has implemented the EU Prospectus Regulation or the UK, to Qualified Investors, or in circumstances in which the prior consent of the Joint Bookrunners has been given to each such proposed offer or resale; or (ii) where the Placing Shares have been acquired or subscribed for by it on behalf of persons in any member state of the EEA or the UK other than Qualified Investors, the offer of those Placing Shares to it is not treated under the EU Prospectus Regulation or the UK Prospectus Regulation (as applicable) as having been made to such persons;
3. it is and, at the time the Placing Shares are acquired, will be either: (i) not located in the United States (within the meaning of Regulation S under the Securities Act ("Regulation S")); acquiring the Placing Shares in an offshore transaction in accordance with Regulation S; not a resident of any Excluded Territories (as defined below) or a corporation, partnership or other entity organised under the laws of any Excluded Territories; and subscribing for the Placing Shares for its own account (or for the account of affiliates or funds managed by it or its affiliates with respect to which it either has investment discretion or which are located outside the United States); or (ii) a QIB, as that term is defined in Rule 144A, which is (a) aware, and each potential beneficial owner of the Placing Shares has been advised, that the sale to it of the Placing Shares is being made in accordance with Rule 144A or another available exemption from, or in a transaction not subject to, registration under the Securities Act, and (b) either acquiring the Placing Shares for its own account, or any account for which it is acquiring the Placing Shares is a QIB. If the Placee is participating in the Placings as or on behalf of a QIB, it agrees to furnish to the Joint Bookrunners and the Company a signed U.S. investor letter in the form provided by the Joint Bookrunners and the Company. These terms and conditions do not constitute, subject to certain exceptions, an offer to sell or issue or the invitation or solicitation of an offer to buy or acquire the Placing Shares in, or to residents of, any jurisdiction including, without limitation, Australia, Canada, Switzerland, South Korea, Israel, South Africa, Japan, Singapore and the United States or any other jurisdiction where the extension or availability of the Placings would breach any applicable laws or regulations (each an "Excluded Territory", and "Excluded Territories" shall mean any of them);
4. it understands (or, if acting for the account of another person, such person understands) the resale and transfer restrictions set out in this Appendix;
5. the Company and the Joint Bookrunners will rely upon the truth and accuracy of the foregoing representations, warranties and acknowledgements; and
6. these terms and conditions and the information contained herein are not for release, publication or distribution, directly or indirectly, in whole or in part, to persons in, or who are residents of, the United States, or subject to certain exceptions any other Excluded Territory.
In particular, the Placing Shares referred to in these terms and conditions have not been and will not be registered under the Securities Act or the securities laws of any state or other jurisdiction of the United States and the Placing Shares may not be offered, sold, transferred or delivered, directly or indirectly in, into or within the United States except pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act and in compliance with any applicable laws of any state or other jurisdiction of the United States. Accordingly, the Placing Shares are being offered and sold outside the United States in accordance with Regulation S. There has not been and will not be a public offering of the Placing Shares in the United States. The Placing Shares have not been approved or disapproved by the U.S. Securities and Exchange Commission, or any state securities commission in the United States, or any other regulatory authority in the United States, nor have any of the foregoing authorities passed upon or endorsed the merits of the Placings or the accuracy or adequacy of these terms and conditions. Any representation to the contrary is a criminal offence in the United States.
The distribution of these terms and conditions and the offer and/or placing of the Placing Shares in certain other jurisdictions may be restricted by law. No action has been or will be taken by any of the Joint Bookrunners or the Company that would, or is intended to, permit an offer of the Placing Shares or possession or distribution of these terms and conditions or any other offering or publicity material relating to the Placing Shares in any jurisdiction where any such action for that purpose is required, save as mentioned above. Persons into whose possession these terms and conditions come are required by the Joint Bookrunners and the Company to inform themselves about and to observe any such restrictions.
Each Placee's commitments will be made solely on the basis of the information set out in the terms and conditions in this Appendix, this announcement and the Preliminary Prospectus. Each Placee, by participating in the Placings, acknowledges and agrees that it has not relied on any other information, representation, warranty or statement made by or on behalf of any of the Joint Bookrunners or the Company or any of their respective affiliates and none of the Joint Bookrunners, the Company or any person acting on such person's behalf or any of their respective affiliates has or shall have liability for any Placee's decision to accept the invitation to participate in the Placing based on any other information, representation, warranty or statement. Each Placee acknowledges and agrees that it has relied on its own investigation of the business, financial or other position of the Company in accepting the invitation to participate in the Placings.
No undertaking, representation, warranty or any other assurance, express or implied, is made or given by or on behalf of any Joint Bookrunner or any of its affiliates, their respective directors, officers, employees, agents, advisers, or any other person, as to the accuracy, completeness, correctness or fairness of the information or opinions contained in the Preliminary Prospectus and/or the Prospectus (when published), this announcement or for any other statement made or purported to be made by any of them, or on behalf of them, in connection with the Company, the Capital Raising or Admission and no such person shall have any responsibility or liability for any such information or opinions or for any errors or omissions. Accordingly, save to the extent permitted by law, no liability whatsoever is accepted by any of the Joint Bookrunners or any of their respective directors, officers, employees or affiliates or any other person for any loss howsoever arising, directly or indirectly, from any use of this announcement or such information or opinions contained herein or otherwise arising in connection with the Preliminary Prospectus and/or the Prospectus (when published).
These terms and conditions do not constitute or form part of, and should not be construed as, any offer or invitation to sell or issue, or any solicitation of any offer to purchase or subscribe for, any Placing Shares or any other securities or an inducement or recommendation to enter into investment activity, nor shall these terms and conditions (or any part of them), nor the fact of their distribution, form the basis of, or be relied on in connection with, any investment activity. No statement in this announcement is intended to be nor may be construed as a profit forecast and nor should any such statement be interpreted to mean that the Company's profits or earnings per share for any future period will necessarily match or exceed historical published profits or earnings per share of the Company.
Proposed Firm Placing of Firm Placing Shares and Conditional Placing of Conditional Placing Shares subject to clawback in respect of valid applications by Qualifying Shareholders pursuant to the Open Offer
Placees are referred to these terms and conditions in this Appendix, this announcement and the Preliminary Prospectus containing details of, inter alia, the Capital Raising. These terms and conditions in this Appendix, this announcement, the Preliminary Prospectus and the Prospectus have been prepared and issued, or will be issued, by the Company, and each of these documents is and will be the sole responsibility of the Company.
The Joint Bookrunners have agreed, pursuant to the Placing Agreement, to use reasonable endeavors to procure subscribers for the Firm Placing Shares and Conditional Placing Shares, as agent for the Company, at the Offer Price. Placees for Conditional Placing Shares in the Conditional Placing are subject to clawback to satisfy valid application by Qualifying Shareholders under the Open Offer. The Firm Placing Shares are not subject to clawback and do not form part of the Placing and Open Offer. The Firm Placing and Placing and Open Offer have been fully underwritten by the Joint Bookrunners on, and subject to, the terms and conditions of the Placing Agreement.
To the extent that any Placee fails to take up any or all of the Placing Shares which have been allocated to it or which it has agreed to take up at the Offer Price, the Joint Bookrunners have severally agreed, on the terms and subject to the conditions in the Placing Agreement, to each take up such Placing Shares at the Offer Price.
To the extent that Placees cannot be found for the Placing Shares which are not applied for by Qualifying Shareholders under the Open Offer, the Joint Bookrunners have severally agreed, on the terms and subject to the conditions in the Placing Agreement, to take up such Placing Shares at the Offer Price.
Application for listing and admission to trading
Applications will be made to the FCA for admission of the New Ordinary Shares to listing on the premium listing segment of the Official List of the FCA and to the London Stock Exchange for admission of the New Ordinary Shares to trading on its main market for listed securities.
Application will also be made to Euroclear UK & International Limited for the entitlements to the Open Offer Shares (the "Open Offer Entitlements") to be admitted as separate participating securities within CREST.
The New Ordinary Shares issued under the Firm Placing, Conditional Placing and Open Offer, when issued and fully paid, will be identical to, and rank pari passu in all respects with, the Existing Ordinary Shares including the right to receive all dividends and other distributions declared, made or paid on the Existing Ordinary Shares by reference to a record date on or after Admission.
Subject to the conditions below being satisfied, it is expected that Admission will become effective on 8 December 2023 and that dealings for normal settlement in the Open Offer Shares will commence at 8.00 a.m. on the same day.
The Firm Placing, Conditional Placing and Open Offer are conditional, inter alia, upon:
(i) the Prospectus being approved by the FCA on or before 4.00 p.m. on 21 November 2023 and being made available to the public by no later than 6.00 p.m. on that day (or, in each case, such later time and/or date as the Joint Bookrunners may, acting jointly and in good faith, agree with the Company);
(ii) the Resolutions being passed by Shareholders at the General Meeting;
(iii) Admission becoming effective by not later than 8.00 a.m. on 8 December 2023 (or such later time or date as the Company and the Joint Bookrunners (acting jointly and in good faith) may agree in writing); and
(iv) the Placing Agreement having become unconditional in all respects and not having been terminated by the Joint Bookrunners in accordance with its terms prior to Admission.
The full terms and conditions of the Open Offer will be contained in the Prospectus to be issued by the Company in connection with the Capital Raising and Admission. The Prospectus to be issued by the Company is expected to be approved by the FCA under section 87A of the FSMA and made available to the public in accordance with Rule 3.2 of the Prospectus Regulation Rules made under Part VI of the FSMA.
Bookbuild of the Placings
The Joint Bookrunners will be conducting an accelerated bookbuild process commencing immediately following this announcement (the "Bookbuild") in order to determine demand for participation in the Placings. The Joint Bookrunners, as agents for the Company, will seek to procure Placees as part of this Bookbuild. These terms and conditions give details of the terms and conditions of, and the mechanics of participation in, the Placings.
Principal terms of the Bookbuild
a) By participating in the Placings, Placees will be deemed: (i) to have read and understood the terms and conditions in this Appendix, this announcement and the Preliminary Prospectus; (ii) to be participating and making an offer for any Placing Shares on these terms and conditions; and (iii) to be providing the representations, warranties, indemnities, agreements, undertakings, acknowledgements and confirmations contained in these terms and conditions.
b) The Joint Bookrunners are arranging the Placings severally, and not jointly, or jointly and severally, as agents of the Company.
c) Participation in the Placings will only be available to persons who are Relevant Persons and who may lawfully be, and are, invited to participate by any of the Joint Bookrunners. The Joint Bookrunners and their respective affiliates are entitled to enter bids for Placing Shares as principal in the Bookbuild.
d) To bid in the Bookbuild, Placees should communicate their bid by telephone or in writing to their usual sales contact at any Joint Bookrunners. Each bid should state the aggregate number of Firm Placing Shares and Conditional Placing Shares which the Placee wishes to acquire at the Offer Price.
e) The Offer Price will be payable to the Joint Bookrunners (on behalf of the Company) by the Placees in respect of the Placing Shares allocated to them. Bids may be scaled down by the Joint Bookrunners on the basis referred to in paragraph (h) below.
f) The Bookbuild is expected to close on or around 8.00 p.m. on 20 November 2023, subject to acceleration, but may close earlier or later, at the discretion of the Joint Bookrunners and the Company. The timing of the closing of the books and allocations will be agreed between the Joint Bookrunners and the Company following completion of the Bookbuild. The Joint Bookrunners may, in agreement with the Company, accept offers to subscribe for Placing Shares that are received after the Bookbuild has closed.
g) An offer to subscribe for Placing Shares in the Bookbuild will be made on the basis of these terms and conditions in this Appendix (which shall be deemed to be incorporated in such offer), this announcement and the Preliminary Prospectus and will be legally binding on the Placee by which, or on behalf of which, it is made and will not be capable of variation or revocation.
h) Subject to paragraph (g) above, the Joint Bookrunners reserve the right not to accept bids or to accept bids, either in whole or in part, on the basis of allocations determined at the Joint Bookrunners' discretion and may scale down any bids as the Joint Bookrunners may determine, subject to consultation with the Company. The acceptance of bids shall be at the Joint Bookrunners' absolute discretion, subject to consultation with the Company.
i) If successful, each Placee's allocation will be confirmed to it by the Joint Bookrunners following the close of the Bookbuild. Oral or written confirmation (at the Joint Bookrunners' discretion) from the Joint Bookrunners to such Placee confirming its allocation will constitute a legally binding commitment upon such Placee, in favour of the Joint Bookrunners and the Company to acquire the number of Placing Shares allocated to it (and in the respective numbers of Firm Placing Shares and Conditional Placing Shares (subject to clawback) so allocated) on the terms and conditions set out herein (which shall be deemed to be incorporated in such legally binding commitment). Each Placee will have an immediate, separate, irrevocable and binding obligation, owed to the Joint Bookrunners, to pay to the Joint Bookrunners (or as the Joint Bookrunners may direct) as agent for the Company in cleared funds an amount equal to the product of the Offer Price and the number of Firm Placing Shares and, once apportioned after clawback (in accordance with the procedure described in the paragraph entitled "Placing Procedure" below), the Conditional Placing Shares, which such Placee has agreed to acquire.
j) Each Placee's allocation and commitment together with settlement arrangements will be confirmed by an electronic contract note and/or electronic trade confirmation issued to such Placee by one of the Joint Bookrunners in due course. The contract note or trade confirmation will include the payment and settlement procedures to be followed by Placees in connection with their acquisition of the Placing Shares.
k) The Company will make a further announcement following the close of the Bookbuild detailing the number of Placing Shares to be issued (the "Placing Results Announcement"). It is expected that such Placing Results Announcement will be made as soon as practicable after the close of the Bookbuild and in any event by no later than 8.00 a.m. on 21 November 2023.
l) Irrespective of the time at which a Placee's allocation(s) pursuant to the Placings is/are confirmed, settlement for all Placing Shares to be acquired pursuant to the Placings will be required to be made at the same time on the basis explained below under the paragraph "Registration and Settlement".
m) By participating in the Bookbuild, each Placee agrees that its rights and obligations in respect of the Firm Placing and/or Conditional Placing will terminate only in the circumstances described below and will not be capable of rescission or termination by the Placee. All obligations under the Placings will be subject to the fulfilment of the conditions referred to below under the paragraph "Conditions of the Placings and Termination of the Placing Agreement".
n) To the fullest extent permissible by law, no Joint Bookrunner nor any of its affiliates nor any of its or their respective affiliates' agents, directors, officers or employees, respectively, shall have any liability to any Placee (or to any other person whether acting on behalf of a Placee or otherwise). In particular, no Joint Bookrunner nor any of its affiliates nor any of its or their respective affiliates' agents, directors, officers or employees, respectively, shall have any liability (including, to the extent permissible by law, any fiduciary duties), to any Placee (or to any person whether acting on behalf of a Placee or otherwise) in respect of the Joint Bookrunners' conduct of the Bookbuild or of such alternative method of effecting the Placings as the Joint Bookrunners and the Company may agree.
Conditions of the Placings and Termination of the Placing Agreement
Placees will only be called on to subscribe for Placing Shares if the obligations of the Joint Bookrunners under the Placing Agreement have become unconditional in all respects and the Joint Bookrunners have not terminated the Placing Agreement prior to Admission.
The Joint Bookrunners' obligations under the Placing Agreement in respect of the Firm Placing, Conditional Placing and Open Offer are conditional upon, inter alia:
a) the Prospectus being approved pursuant to the Prospectus Regulation Rules and FSMA by the FCA not later than 4.00 p.m. on 21 November 2023 and being made available to the public in accordance with the UK Prospectus Regulation Rules by no later than 6.00 p.m. that day (or such later time and/or date as the Company and the Joint Bookrunners may agree);
b) Admission occurring not later than 8.00 a.m. on 8 December 2023 or such later time and/or date as the Company and the Joint Bookrunners (acting jointly) may agree in writing, not being later than 22 December 2023;
c) the passing of the Resolutions (without any amendment which, in the opinion of the Joint Bookrunners (acting jointly) is material) at the General Meeting by no later than 7 December 2023 (or at any adjournment of such meeting);
d) the representations and warranties given by the Company to the Joint Bookrunners in the Placing Agreement (disregarding any materiality qualifiers set out therein), being true and accurate as of the date of the Placing Agreement, the date of the Prospectus, the date of any supplementary prospectus published prior to Admission and immediately before Admission, in each case as though they had been given by reference to the facts and circumstances subsisting therein, save to the extent, that, in the good faith opinion of the Joint Bookrunners (acting jointly), the relevant matter is not material; and
e) compliance by the Company with all of its obligations and undertakings under the Placing Agreement or under the terms and conditions of the Capital Raising which fall to be performed or complied with on or prior to Admission, save to the extent that, in the good faith opinion of the Joint Bookrunners (acting jointly) such non-compliance is not material;
f) the Irrevocable Undertakings remaining in full force and effect and not having been terminated or modified or amended in any material respect;
g) there not having occurred, in the good faith opinion of the Joint Bookrunners (acting jointly), any Material Adverse Change (as that term is defined in the Placing Agreement) at any time between the date of the Placing Agreement and prior to Admission (whether or not foreseeable at the date of the Placing Agreement);
h) the posting of the Application Forms and the sending of a CREST instruction to credit the CREST accounts of Qualifying Shareholders as contemplated in the Prospectus and in accordance with the Placing Agreement;
i) no matter referred to in paragraph 3.4.1 of the UK Prospectus Regulation Rules or Article 23(1) of the UK Prospectus Regulation arising between the publication of the Prospectus and Admission which the Joint Bookrunners (acting jointly) consider in good faith to be material;
j) any Supplementary Prospectus required prior to Admission pursuant to Article 23 of the UK Prospectus Regulation having been approved by the FCA and having been published prior to Admission in accordance with Article 21 of the UK Prospectus Regulation;
k) no event requiring the publication of a Supplementary Prospectus referred to in paragraph 3.4.1 of the Prospectus Regulation Rules or Article 23 of the UK Prospectus Regulation arising between the time of publication of the Prospectus and Admission and no supplementary prospectus being published by or on behalf of the Company before Admission; and
l) the Company having applied to Euroclear for admission of the Open Offer Entitlements as participating securities within CREST and no notification having been received from Euroclear on or prior to Admission that such admission has been or is to be refused and Euroclear approving the entry into CREST of the Open Offer Entitlements,
(all such conditions included in the Placing Agreement being, together, the "Conditions").
The Placing Agreement can be terminated at any time before Admission by the Joint Bookrunners by giving notice to the Company in certain circumstances, including (but not limited to) where:
a) any statement contained in any offer document (or any amendment or supplement thereto) is or has become untrue inaccurate in any material respect or omits to state a material fact necessary in order to make such statement, in light of the circumstances under which it was made, not misleading, or any matter has arisen which would, if the offer documents were to be issued at that time constitute a material omission therefrom (or an amendment or supplement to any of them) which, in the opinion of the Joint Bookrunners (acting jointly), is material;
b) there has been a breach by the Company of any of its obligations under the Placing Agreement except to the extent as would not be, in the opinion of the Joint Bookrunners (acting jointly and in good faith), materially adverse in the context of the Capital Raising and/or the underwriting of the New Ordinary Shares and/or Admission;
c) the Irrevocable Undertakings have been terminated or modified or amended in any material respect;
d) there has been a breach by the Company of any of the warranties, representations or undertakings given by it pursuant to the Placing Agreement, or an event occurs which, if those warranties, representations or undertakings were repeated immediately after that event, would make any of those warranties representations or undertakings untrue (disregarding any materiality qualifiers set out therein), in each case to an extent which the Joint Bookrunners (acting in good faith) determine to be material;
e) there has been, in the good faith opinion of the Joint Bookrunners (acting jointly), a Material Adverse Change (as defined in the Placing Agreement), whether or not foreseeable at the date of the Placing Agreement;
f) there has occurred:
a. (i) any adverse change in the financial markets in the United States, the United Kingdom or in any member of the European Economic Area or the international financial markets; (ii) any outbreak or escalation of hostilities, war, act of terrorism, declaration of emergency or martial law or other calamity or crisis or event; (iii) any change or development involving a prospective change in national or international political, financial, economic, monetary or market conditions or currency exchange rates or controls;
b. any suspension of, material limitation to, trading in any securities of the Company by the London Stock Exchange or the suspension or material limitation to trading generally on the New York Stock Exchange, the NASDAQ National Market or the London Stock Exchange, or minimum or maximum prices for trading having been fixed, or maximum ranges for prices of securities having been required, by any of said exchanges or by order of any governmental authority, or a material disruption in commercial banking or securities settlement or clearance services in the United States, the United Kingdom or in any member of the European Economic Area;
c. any change in the United Kingdom taxation laws materially adversely affecting the Group, the Placing Shares or the issue thereof; or
d. any declaration of a banking moratorium by the United States, the United Kingdom or any member of the European Economic Area,
which would, in the good faith opinion of the Joint Bookrunners (acting jointly), impractical or inadvisable to proceed with the Capital Raising or the underwriting of the Placing Shares, or
g) the application for Admission is refused by the FCA and/or the London Stock Exchange, or is withdrawn by the Company.
If any Condition has not been satisfied or has become incapable of being satisfied by the required time and date (and is not waived by the Joint Bookrunners as described below) or if the Placing Agreement is terminated, all obligations under these terms and conditions will automatically terminate.
By participating in the Placings, each Placee agrees that its rights and obligations hereunder are conditional upon the Placing Agreement becoming unconditional in all respects and that its rights and obligations will terminate only in the circumstances described above and will not be capable of rescission or termination by it after oral or written confirmation by the Joint Bookrunners (at the Joint Bookrunners' discretion) following the close of the Bookbuild.
The Joint Bookrunners, acting jointly, may in their absolute discretion in writing and upon such terms as they think fit waive the satisfaction of certain of the Conditions in the Placing Agreement or extend the time provided for fulfilment of such Conditions. Any such extension or waiver will not affect Placees' commitments as set out in these terms and conditions.
By participating in the Placings each Placee agrees that the exercise by the Company or any of the Joint Bookrunners of any right or other discretion under the Placing Agreement, including (without limitation) any decision made by the Joint Bookrunners as to whether or not to waive or to extend the time and/or date for the fulfilment of any condition in the Placing Agreement and/or (on behalf of the Joint Bookrunners) whether or not to exercise any termination right, shall be within the absolute discretion of the Company and each Joint Bookrunners (as the case may be).
Neither the Company nor either Joint Bookrunners 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 made by the Joint Bookrunners as to whether or not to waive or to extend the time and/or date for the fulfilment of any condition in the Placing Agreement and/or whether or not to exercise any such termination right.
Withdrawal Rights
Placees acknowledge that their agreement to subscribe for Placing Shares is not by way of acceptance of the public offer made in the Prospectus and the Application Form but is by way of a collateral contract and as such Article 23(2) of the EU Prospectus Regulation and the UK Prospectus Regulation does not entitle Placees to withdraw in the event that the Company publishes a supplementary prospectus in connection with the Capital Raising or Admission.
Placing Procedure
Placees shall subscribe for the Firm Placing Shares and/or Conditional Placing Shares to be issued pursuant to the Firm Placing and/or Conditional Placing (subject to clawback in the case of the Conditional Placing) and any allocation of the Firm Placing Shares and Conditional Placing Shares (subject to clawback) to be issued pursuant to the Firm Placing and/or the Conditional Placing will be notified to them on or around 20 November 2023 (or such other time and/or date as the Company and the Joint Bookrunners may agree).
Placees will be called upon to subscribe for, and shall subscribe for, the Conditional Placing Shares only to the extent that valid applications and payment in full by Qualifying Shareholders under the Open Offer are not received by 11.00 a.m. on 6 December 2023 or if applications haven otherwise not been deemed to be valid in accordance with the terms set out in the Prospectus and the Application Form.
If you are a Qualifying Shareholder and you take up and pay for New Ordinary Shares under the Open Offer to which you are entitled in accordance with its terms, you may request, by returning an off-set application form which may be acquired from the Joint Bookrunners (the "Off-set Application Form"), that your participation in the Conditional Placing be reduced by up to the number of New Ordinary Shares in your total Open Offer entitlement which you have validly taken up and paid for under the Open Offer (to a maximum of the number of New Ordinary Shares in your Conditional Placing participation) ("Off-set"). If the Off-set Application Form is not returned by the closing time of the Open Offer, you will be deemed to have waived your right to claim Off-set in respect of any New Ordinary Shares taken up under the Open Offer.
Payment in full for any Firm Placing Shares and Conditional Placing Shares so allocated (subject to clawback in the case of the Conditional Placing Shares) in respect of the Placings at the Offer Price must be made by no later than 8 a.m. on 8 December 2023 (or by such later date as shall be no later than five business days following Admission, if Admission is delayed).
The Joint Bookrunners will notify Placees if any of the dates in these terms and conditions should change, including as a result of delay in the posting of the Prospectus, the Application Forms or the crediting of the Open Offer Entitlements in CREST or the production of a supplementary prospectus or otherwise.
Lock-up
The Company has undertaken to the Joint Bookrunners that, between the date of the Placing Agreement and the date falling 180 days after the last date for acceptance under the terms of the Open Offer (inclusive), it will not, without the prior written consent of the Joint Bookrunners enter into certain transactions involving or relating to the Ordinary Shares, subject to certain customary and other carve-outs agreed between the Joint Bookrunners and the Company.
By participating in the Placings, Placees agree that the exercise by the Joint Bookrunners of any power to grant consent to waive the undertaking by the Company of a transaction which would otherwise be subject to the lock-up under the Placing Agreement shall be within the absolute discretion of the Joint Bookrunners and that they need not make any reference to, or consult with, Placees and that they shall have no liability to Placees whatsoever in connection with any such exercise of the power to grant consent.
Registration and Settlement
Settlement of transactions in the Placing Shares following Admission will take place within the CREST system, subject to certain exceptions.
The Joint Bookrunners and the Company reserve the right to require settlement for, and delivery of, the Placing Shares to Placees by such other means that they deem necessary if delivery or settlement is not possible or practicable within the CREST system within the timetable set out in the Preliminary Prospectus and/or the Prospectus or would not be consistent with the regulatory requirements in the Placee's jurisdiction. Each Placee will be deemed to agree that it will do all things necessary to ensure that delivery and payment is completed in accordance with either the standing CREST or certificated settlement instructions which they have in place with the relevant Joint Bookrunner.
Settlement for the Placing Shares will be on a delivery versus payment basis and is expected to take place on or around 8 December 2023.
Interest is chargeable daily on payments to the extent that value is received after the due date from Placees at the rate of two percentage points above prevailing SONIA. Each Placee is deemed to agree that if it does not comply with these obligations, the Joint Bookrunners may sell any or all of the Placing Shares allocated to it on its behalf and retain from the proceeds, for its own account and benefit, an amount equal to the aggregate amount owed by the Placee to the Joint Bookrunners (on behalf of the Company) plus any interest due. By communicating a bid for Placing Shares, each Placee confers on the Joint Bookrunners and the Company all such authorities and powers necessary to carry out any such sale and agrees to ratify and confirm all actions which the Joint Bookrunners lawfully take in pursuance of such sale. The relevant Placee will, however, remain liable for any shortfall below the aggregate amount owed by it and may be required to bear any stamp duty or stamp duty reserve tax (together with any interest or penalties) which may arise upon any transaction in the Placing Shares on such Placee's behalf.
Acceptance
By participating in the Placings, each Placee (and any person acting on such Placee's behalf) (together, "you") irrevocably acknowledges, confirms, undertakes, represents, warrants and agrees (as the case may be) with the Joint Bookrunners (and their respective affiliates and agents, including in the case of Investec, Investec Europe Limited, trading as "Investec Europe") and the Company, the following:
1. you are duly incorporated and validly existing under the laws of your jurisdiction of incorporation. You have power under your constitutional documents and have obtained all necessary authorities (including, without limitation, all relevant members' resolutions) to subscribe and pay for the Placing Shares in the manner proposed and to enter into and perform your obligations pursuant to these terms and conditions in this Appendix, and there are no governmental or regulatory consents or other third party approvals, authorisations or orders required in order for you to subscribe and pay for the Placing Shares in the manner proposed and to enter into and perform your obligations pursuant to these terms and conditions in this Appendix that have not been or will not prior to Admission have been obtained and you have not taken any action which will or may result in any of the Joint Bookrunners or the Company being in breach of the legal or regulatory requirements of any jurisdiction;
2. your agreement to subscribe for Placing Shares will comply with all agreements to which you are a party or by which you or any of your properties or assets is bound and which are material to your participation and your obligations in respect thereof;
3. the information, if any, relating to you set out in the Preliminary Prospectus is true and accurate and not misleading in any respect and the information relating to you provided or to be provided to you for inclusion in the Prospectus is or will be true and accurate and not misleading in any respect;
4. you have received a copy of this announcement (and the terms and conditions herein), the Preliminary Prospectus (including the terms and conditions of the Capital Raising) and all such other information as you deem necessary to make an investment decision in relation to the Placing Shares. Your commitment will be solely on the basis of the information contained in the Preliminary Prospectus and this announcement. You acknowledge however that the Preliminary Prospectus is in draft form and is subject to updating, completion, revision, further verification and amendment and you agree that you have relied on your own investigation of the business, financial or other position of the Company in accepting your Placing participation;
5. you have funds available to pay the full amount in respect of your participation in the Placings as and when due;
6. you acknowledge and agree that the Placing Shares have not been and will not be registered under the Securities Act or with any securities regulatory authority of any state or other jurisdiction of the United States. You further understand that the Placing Shares have not been registered under the applicable laws of any of the Excluded Territories;
7. You are not located in the United States (within the meaning of Regulation S); you are acquiring the Placing Shares in an offshore transaction in accordance with Regulation S; not a resident of any Excluded Territories or a corporation, partnership or other entity organised under the laws of any Excluded Territories; and subscribing for the Placing Shares for your own account (or for the account of your affiliates or funds managed by you or your affiliates with respect to which you either have investment discretion or which are located outside the United States);
8. you are subscribing for the Placing Shares for investment purposes, in each case, not with a view to, or for resale in connection with, the distribution thereof, directly or indirectly, in whole or in part, into or within the United States within the meaning of U.S. securities laws;
9. you acknowledge and agree that you are not acquiring the Placing Shares as a result of any "directed selling efforts" as defined in Regulation S;
10. you are (i) a person of a kind described in Article 19 and/or Article 49 of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 (the "Order") and you understand that the terms and conditions set out herein are directed only at (a) persons who have professional experience in matters relating to investments who fall within the definition of "investment professionals" in Article 19(5) of the Order or (b) high net worth entities (including companies and unincorporated associations of high net worth and trusts of high value) or other persons falling within Article 49(2)(a) to (d) of the Order, and that, accordingly, any investment or investment activity to which these terms and conditions relate is available only to you as such a person or will be engaged in only with you as such a person; and (ii) not intending to offer or sell or otherwise deal with the Placing Shares in any way which would result in an offer to the public in the UK within the meaning of the FSMA or in any other jurisdiction or require registration or prospectus publication or similar actions in any other jurisdiction;
11. you understand and accept that in offering you a participation in the Placings, neither of the Joint Bookrunners is making any recommendations to or advising you regarding the suitability or merits of any transaction you may enter into in connection with the Capital Raising or otherwise and that you are not, and do not regard yourself as, a client of any of the Joint Bookrunners in connection with the Capital Raising. To the fullest extent permitted by law, you acknowledge and agree to the disclaimers contained in this announcement;
12. you acknowledge that Investec Bank plc is authorised by the Prudential Regulation Authority (the "PRA") and regulated in the United Kingdom by the FCA and the PRA. Investec Europe, acting as agent on behalf of Investec Bank plc in certain jurisdictions in the EEA, is regulated in Ireland by the Central Bank of Ireland;
13. without limiting the foregoing, you acknowledge that the Joint Bookrunners are acting exclusively for the Company and no-one else in connection with the Capital Raising, and will not be responsible to anyone other than the Company for providing the protections afforded to their respective clients nor for providing advice in connection with the Capital Raising or any other matter referred to in these terms and conditions in this Appendix or this announcement;
14. you understand and accept that the exercise by either of the Joint Bookrunners of any rights or discretions under the Placing Agreement shall be within the absolute discretion of such Joint Bookrunners and no Joint Bookrunners need have any reference to you and shall have no liability to you whatsoever in connection with any decision to exercise or not to exercise any such right and you agree that you have no rights against either of the Joint Bookrunners or the Company, or any of their respective directors and employees under the Placing Agreement pursuant to the Contracts (Rights of Third Parties Act) 1999;
15. you are not a person whose business is, or includes, issuing depository receipts or a person whose business is, or includes, the provision of clearance services for the purchase or sale of securities or a nominee of any such person;
16. you declare that sections 67, 70, 93 and 96 of the Finance Act 1986 (depositary receipts and clearance services) do not apply on your acquisition of any Placing Shares under the Capital Raising (if this is not applicable please indicate your status for stamp duty and stamp duty reserve tax purposes);
17. you have read, agreed with, understood and accepted the terms and conditions in this Appendix, this announcement and the Preliminary Prospectus and, accordingly, irrevocably agree in accordance with such terms and conditions to subscribe and pay for the number of Placing Shares comprised in your participation in the Placings. In particular, and without limitation, you acknowledge that your participation in the Conditional Placing is subject to clawback to satisfy acceptances under the terms of the Open Offer;
18. you acknowledge that your agreement to subscribe for the number of Placing Shares comprised in your participation in the Placings is not to be made pursuant to the Prospectus but is made pursuant to these terms and conditions in this Appendix;
19. you confirm that if you duly apply and subscribe (on the terms set out in the Prospectus) for Open Offer Shares to which you are entitled such application and subscription shall extend to an irrevocable undertaking to subscribe such number of New Ordinary Shares at the Offer Price following expiry of the Open Offer in the event that, as a result of your default or otherwise, you have failed to fulfil your obligation to apply and subscribe for all those Open Offer Shares to which you are entitled;
20. you have not, in agreeing to subscribe for Placing Shares, relied on any information, representations and/or warranties from any of the Joint Bookrunners or the Company or any of their directors, officers, agents, representatives, subsidiaries or affiliates or any other person save for the information contained in the Preliminary Prospectus and this announcement;
21. you acknowledge that the content of this announcement, the Preliminary Prospectus and the Prospectus is exclusively the responsibility of the Company and none of the Joint Bookrunners nor any person acting on their behalf has or shall have liability for any information, representation or statement contained in such documents or any information previously published by or on behalf of the Company and will not be liable for your decision to participate in the Capital Raising based on any information, representation or statement contained in such documents or otherwise;
22. (i) you have not relied on, and will not rely on, any information relating to the Company contained or which may be contained in any research report or investor presentation prepared or which may be prepared by either Joint Bookrunner or any of their respective affiliates or any person acting on behalf of any such person; (ii) neither Joint Bookrunner nor any of their respective affiliates nor any person acting on behalf of any of such persons has or shall have any responsibility or liability for public information relating to the Company; (iii) neither Joint Bookrunner nor any of their respective affiliates nor any person acting on behalf of any of such persons has or shall have any responsibility or liability for any additional information that has otherwise been made available to it, whether at the date of publication of such information, the date of these terms and conditions or otherwise; and that (iv) neither Joint Bookrunner nor any of their respective affiliates nor any person acting on behalf of any of such persons makes any representation or warranty, express or implied, as to the truth, accuracy or completeness of any such information referred to in (i) to (iii) above, whether at the date of publication of such information, the date of this announcement or otherwise;
23. you are acting as principal only in respect of the Capital Raising or, if you are acting for any other person: (i) you are duly authorised to do so and has full power to make the acknowledgments, representations and agreements herein on behalf of each such person; (ii) you are and will remain liable to the Company and the Joint Bookrunners for the performance of all your obligations as a Placee in respect of the Capital Raising (regardless of the fact that you are acting for another person); (iii) you are a Relevant Person and undertakes that you will acquire, hold, manage or dispose of any Placing Shares that are allocated to you for the purposes of your business; and/or if you are a financial intermediary, as that term is used in Article 5(1) of the Prospectus Regulation, that (a) the Placing Shares acquired by you in the Capital Raising will not be acquired on a non-discretionary basis for, or on behalf of, nor will they be acquired with a view to their offer or resale to, persons in a member state of the EEA or the UK other than Qualified Investors, or in circumstances which may give rise to an offer of securities to the public other than an offer or resale, in a member state of the EEA to Qualified Investors, or in circumstances in which the prior consent of the Joint Bookrunners has been given to each such proposed offer or resale; or (b) where the Placing Shares have been acquired by you on behalf of persons in any member state of the EEA or the United Kingdom other than Qualified Investors, the offer of those Placing Shares to you are not treated under the Prospectus Regulation as having been made to such persons;
24. that a communication that the Capital Raising or the book is "covered" (i.e. indicated demand from investors in the book equals or exceeds the amount of the securities being offered) is not any indication or assurance that the book will remain covered or that the Capital Raising and securities will be fully distributed by the Joint Bookrunners. Each of the Joint Bookrunners reserve the right to take up a portion of the securities in the Capital Raising as a principal position at any stage at their sole discretion, inter alia, to take account of the Company's objectives, MiFID II requirements and/or their allocation policies;
25. you and any person acting on your behalf acknowledge that none of the Joint Bookrunners owes any fiduciary or other duty to you in respect of any representations, warranties, undertakings or indemnities in the Placing Agreement;
26. you agree to provide the Joint Bookrunners with such relevant documents as they may reasonably request to comply with requests or requirements that either they or the Company may receive from relevant regulators in relation to the Capital Raising, subject to its legal, regulatory and compliance requirements and restrictions;
27. you will not, during the period commencing on the date of this Announcement and ending on Admission: (i) directly or indirectly, enter into any swap, derivative, or other transaction or arrangement that is intended, directly or indirectly, to have the economic effect of hedging or otherwise mitigating the economic risk associated with your commitment to subscribe for Placing Shares or Open Offer Shares, whether any such transaction is to be settled by delivery of Placing Shares, Open Offer Shares or other securities, in cash, or otherwise; or (ii) engage in any short selling or any purchase, sale, or grant of any right (including, without limitation, any put or call option) with respect to any Placing Shares or Open Offer Shares or any securities convertible into or exchangeable or exercisable for Placing Shares or Open Offer Shares (each, a "Short Position"). You represent and warrant that, as of the date of this announcement, you do not have any Short Position with respect to the Ordinary Shares or any securities convertible into or exchangeable or exercisable for Ordinary Shares. You acknowledge that the Company and the Joint Bookrunners are relying on this clause in accepting your order and that any breach of this clause would cause irreparable harm to the Company and the Joint Bookrunners. The foregoing shall not apply to your ordinary course sales and trading activity unrelated to your obligations to subscribe for Placing Shares or Open Offer Shares in the Capital Raising, and in particular (but without limitation) (save as prohibited by law) it shall not apply to: (a) any transaction to facilitate a client order; (b) transactions constituting ordinary course market making activity; (c) transactions entered into for the purposes of hedging in relation to the Company's securities that are undertaken with a view to achieving a substantially market neutral position (but allowing for daily trading fluctuations and without taking into account your commitment to subscribe for Placing Shares or Open Offer Shares); (d) principal positions in the Company's securities or in derivatives related to the Company's securities held or entered into by you or any of your affiliates in the ordinary course of business prior to the date of this announcement; or (e) transactions that involve any securities or derivatives that reference any existing and established sector or market index, provided that the weighting of the Ordinary Shares in such sector does not exceed 10 per cent. of the index, and any such transactions shall be undertaken in compliance with applicable securities laws and regulations;
28. you are aware of, have complied with and will continue to comply with any obligations we have under the Criminal Justice Act 1993, the Proceeds of Crime Act 2002, the Financial Services and Markets Act 2000 and MAR, to the extent applicable to you;
29. if you are a resident in the EEA, you are a 'Qualified Investor' within the meaning of the EU Prospectus Regulation (EU) 2017/1129;
30. you are aware of your obligations in connection with money laundering under the Proceeds of Crime Act 2002 and have complied with the Money Laundering Regulations 2017 and any other applicable legislation concerning prevention of money laundering (the "Regulations") and, if you are making payment on behalf of a third party, you have obtained and recorded satisfactory evidence to verify the identity of the third party as required by the Regulations;
31. if you are acquiring any New Ordinary Shares as a fiduciary or agent for one or more accounts, you have sole investment discretion with respect to each such account and you have full power to make, and do make, the warranties and undertakings set out herein on behalf of each such account;
32. you acknowledge that time is of the essence as regards your obligations in respect of your participation in the Placings; and
33. you acknowledge that the Company, each Joint Bookrunners and any person acting on their behalf will rely upon the truth and accuracy of and compliance with the foregoing confirmations, representations, warranties, undertakings and acknowledgements.
Please also note that the agreement to allot and issue Placing Shares to Placees (or the persons for whom Placees are contracting as agent) free of stamp duty and stamp duty reserve tax in the UK relates only to their allotment and issue to Placees, or such persons as they nominate as their agents, direct from the Company for the Placing Shares in question. Each Placee agrees to indemnify on an after-tax basis and hold each of the Joint Bookrunners and/or the Company and their respective affiliates harmless from any and all stamp duty, stamp duty reserve tax and all other similar duties or taxes to the extent that such taxes, interest, fines or penalties arise from the unreasonable default or delay of that Placee or its agent. In addition, Placees should note that they will be liable for any capital duty, stamp duty and all other stamp, issue, securities, transfer, registration, documentary or other duties or taxes (including any interest, fines or penalties relating thereto) payable outside the UK by them or any other person on the acquisition by them of any Placing Shares or the agreement by them to acquire any Placing Shares.
Furthermore, each Placee agrees to indemnify and hold the Company, each of the Joint Bookrunners and each of their and their respective affiliates' agents, directors, officers and employees, harmless from any and all costs, claims, liabilities and expenses (including legal fees and expenses) arising out of or in connection with any breach of the representations, warranties, acknowledgements, agreements and undertakings given by the Placee in this announcement and further agrees that the Company and each of the Joint Bookrunners and their respective affiliates and agents (including, in the case of Investec Bank plc, Investec Europe) will rely on the truth and accuracy of the confirmations, warranties, acknowledgements and undertakings in this announcement and, if any of the foregoing is or becomes no longer true or accurate, the Placee shall promptly notify the Joint Bookrunners and the Company. All confirmations, warranties, acknowledgements, agreements and undertakings given by the Placee, pursuant to this announcement are given to each of the Joint Bookrunners for itself and its respective affiliates and agents (including in the case of Investec Bank plc, Investec Europe) and on behalf of the Company and will survive completion of the Placing and Open Offer and/or Admission.
Selling Restrictions
By participating in the Placings, you irrevocably acknowledge, confirm, undertake, represent, warrant and agree (as the case may be) with the Joint Bookrunners and the Company, the following:
1. you are not a person who has a registered address in, or is a resident, citizen or national of, a country or countries, in which it is unlawful to make or accept an offer to subscribe for Placing Shares;
2. you have fully observed and will fully observe the applicable laws of any relevant territory, including complying with the selling restrictions set out herein and obtaining any requisite governmental or other consents and you have fully observed and will fully observe any other requisite formalities and pay any issue, transfer or other taxes due in such territories;
3. if you are in the United Kingdom, you are a Qualified Investor within the meaning of Article 2(e) of the UK Prospectus Regulation: (i) who has professional experience in matters relating to investments and who falls within the definition of "investment professionals" in Article 19(5) of the Order; or (ii) who falls within Article 49(2) of the Order;
4. if you are in a member state of the EEA, you are a Qualified Investor as defined in Article 2(e) of the EU Prospectus Regulation;
5. you are a person whose ordinary activities involve you (as principal or agent) acquiring, holding, managing or disposing of investments for the purpose of your business and you undertake that you will (as principal or agent) acquire, hold, manage or dispose of any Placing Shares that are allocated to you for the purposes of your business;
6. you are and, at the time the Placing Shares are purchased, will be outside the United States, acquiring the Placing Shares in an offshore transaction in accordance with Regulation S; not a resident of any Excluded Territory or a corporation, partnership or other entity organised under the laws of any Excluded Territory; subscribing for Placing Shares for your own account (or for the account of your affiliates or funds managed by you or your affiliates with respect to which you either have investment discretion or which are outside the United States);
7. none of the Placing Shares have been or will be registered under the Securities Act or with any securities regulatory authority of any state or other jurisdiction of the United States; and
8. you (on your behalf and on behalf of any Placee on whose behalf you are acting) have: (a) fully observed the laws of all relevant jurisdictions which apply to you; (b) obtained all governmental and other consents which may be required; (c) fully observed any other requisite formalities; (d) paid or will pay any issue, transfer or other taxes; (e) not taken any action which will or may result in the Company or the Joint Bookrunners (or any of them) being in breach of a legal or regulatory requirement of any territory in connection with the Placings; (f) obtained all other necessary consents and authorities required to enable you to give your commitment to subscribe for the relevant Placing Shares; and (g) the power and capacity to, and will, perform your obligations under the terms contained in these terms and conditions.
Times
Unless the context otherwise requires, all references to time are to London time. All times and dates in these terms and conditions may be subject to amendment. The Joint Bookrunners will notify Placees and any persons acting on behalf of the Placees of any changes.
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