THIS ANNOUNCEMENT (INCLUDING THE APPENDICES) AND THE INFORMATION CONTAINED HEREIN IS RESTRICTED AND IS NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, IN WHOLE OR IN PART, DIRECTLY OR INDIRECTLY, IN, INTO OR FROM THE UNITED STATES, AUSTRALIA, NEW ZEALAND, CANADA, THE REPUBLIC OF SOUTH AFRICA OR JAPAN OR ANY OTHER JURISDICTION IN WHICH SUCH RELEASE, PUBLICATION OR DISTRIBUTION WOULD BE UNLAWFUL. PLEASE SEE THE IMPORTANT NOTICES AT THE END OF THIS ANNOUNCEMENT.

THIS ANNOUNCEMENT IS FOR INFORMATION PURPOSES ONLY AND DOES NOT CONSTITUTE OR CONTAIN AN INVITATION, SOLICITATION, RECOMMENDATION, OFFER OR ADVICE TO ANY PERSON FOR THE SALE OR SUBSCRIPTION FOR THE SECURITIES IN ILIKA PLC IN ANY JURISDICTION IN WHICH SUCH INVITATION, SOLICITATION, RECOMMENDATION, OFFER, SUBSCRIPTION OR SALE WOULD BE UNLAWFUL UNDER THE SECURITIES LAWS OF ANY SUCH JURISDICTION. THIS ANNOUNCEMENT IS NOT AN OFFER OF OR SOLICITATION TO PURCHASE OR SUBSCRIBE FOR SECURITIES IN THE UNITED STATES.

THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION

 

Ilika plc

 

 

Proposed Placing and Open Offer

Posting of Circular & Notice of General Meeting

 

Raising gross proceeds of up to approximately £3.4 million

 

Ilika plc (AIM: IKA) ("Ilika", the "Company" or, together with its subsidiary undertakings, the "Group"), an independent global expert in solid-state battery technology, today announces a proposed conditional placing of up to 6,071,428 new ordinary shares of one penny each ("Ordinary Shares") in the capital of the Company (the "Placing Shares") at a price of 28 pence per Placing Share (the "Issue Price") to raise gross proceeds of approximately £1.7 million (the "Placing").

 

The Placing Shares represent approximately 3.8 per cent. of the existing issued ordinary share capital of the Company (the "Existing Ordinary Shares") and the Issue Price represents a discount of approximately 5.1 per cent. to the closing mid-market price of 29.5 pence per Existing Ordinary Share on 9 May 2024, being the latest practicable date prior to the publication of this Announcement.

 

The Company also intends to raise gross proceeds of up to approximately £1.7 million through the issue of up to 6,114,449 new Ordinary Shares (the "Open Offer Shares") pursuant to an open offer (the "Open Offer") to allow Ilika shareholders, including those who are not participating in the Placing, to subscribe for new Ordinary Shares at the Issue Price.

 

It is intended that the Placing, the Open Offer and the Director Subscriptions (together the "Capital Raising") will result in the Company raising total gross proceeds of up to approximately £3.4 million.

 

Capitalised terms used in this announcement (including the appendices) (this "Announcement") have the meanings given to them in Appendix 3 to this Announcement, unless the context provides otherwise.

 

Liberum Capital Limited ("Liberum") and Joh. Berenberg, Gossler & Co. KG ("Berenberg") are acting as joint bookrunners (together being the "Joint Bookrunners") in connection with the Placing. The Placing Shares are being offered by way of an accelerated bookbuild (the "Bookbuild"), which will be launched immediately following this Announcement, in accordance with the terms and conditions set out in Appendix 4 to this Announcement.

 

The timing of the closing of the Bookbuild and the allocation of Placing Shares to be issued at the Issue Price are to be determined at the discretion of the Company and the Joint Bookrunners.

 

A further announcement will be made following the close of the Bookbuild, confirming final details of the Placing.

 

Capital Raising highlights

 

·    Conditional Placing to raise gross proceeds of approximately £1.7 million and an associated Open Offer to raise gross proceeds of up to approximately £1.7 million through the issue of an aggregate of up to 12,185,877 new Ordinary Shares at the Issue Price.

 

·    Intended Director Subscriptions to raise gross proceeds of approximately £22,000 through the issue of an aggregate of 78,570 new Ordinary Shares at the Issue Price.

 

·    The net proceeds of the Capital Raising are expected to be utilised to drive Ilika's roadmap for its Goliath solid-state battery projects.

 

·    In particular, the net proceeds of the Placing (being approximately £1.5 million) are expected to be utilised as follows:

 

o  £0.75 million to support the development of Goliath technology , with grant assistance, to support partner collaboration;

o  £0.75 million to increase the battery testing capacity from 20 kWh/a to 0.75 MWh/a and to upgrade existing dry room facilities; and

o  any Placing proceeds over £1.5 million to further support of Goliath working capital and capital expenditure for expansion of testing and dry room facilities and support of Stereax working capital.

 

The net proceeds of the Open Offer and the Director Subscriptions will be used to further support the Group's working capital requirements.

 

The Directors are of the opinion, the net proceeds of the Capital Raising will further strengthen the balance sheet (cash and cash equivalents as at 30 April 2024 in excess of £11 million) and provide working capital beyond 12 months from the date of this announcement.

 

Posting of Circular

The Company intends to publish and send a circular (the "Circular") to shareholders in connection with the Open Offer on or around 13 May 2024. The Circular will also be available on the Company's website: www.Ilika.com.

 

General Meeting

The Capital Raising is conditional upon, inter alia, the passing of the Resolutions at the General Meeting. The Company will hold the General Meeting at the offices of Eversheds Sutherland (International) LLP, One Wood Street, London, EC2V 7WS at 11.00 a.m. on 29 May 2024.

 

The Expected Timetable of Principal Events is set out in Appendix 2 of this Announcement whilst the Placing and Open Offer Statistics as well as the Chairman's Letter, as extracted from the Circular, are set out below.

 

The person responsible for arranging the release of this Announcement on behalf of the Company is Graeme Purdy, Chief Executive of the Company.

 

For more information contact:
Ilika plc		www.ilika.com
Graeme Purdy, Chief Executive		Via Walbrook PR
Jason Stewart, Chief Financial Officer
Liberum Capital Limited (Nomad and Joint Bookrunner)		Tel: 020 3100 2000
Andrew Godber, John More
Nikhil Varghese, Joshua Borlant
Joh. Berenberg, Gossler & Co. KG (Joint Bookrunner)		Tel: 020 3207 8700
Mark Whitmore, Detlir Elezi, Natasha Ninkov
Walbrook PR Ltd	Tel: 020 7933 8780 / Ilika@walbrookpr.com
Nick Rome, Charlotte Edgar, Joe Walker

 

About Ilika plc - https://www.ilika.com

 

Ilika specialises in the developing and commercialisation of solid state batteries. The Company's mission is to rapidly develop leading-edge IP, manufacture and license solid state batteries for markets that cannot be addressed with conventional batteries due to their safety, charge rates, energy density and life limits. The Company achieves this by using ceramic-based lithium-ion technology that is inherently safe in manufacture and usage, higher thermal tolerance and easier to recycle which differentiates our products from existing batteries.

 

The Company has two product lines. Its Stereax batteries which are designed for powering miniature medical implants, industrial wireless sensors and industrial internet of Things (IIoT) applications and the Goliath large format batteries designed for EV cars and cordless appliances.

 

IMPORTANT NOTICES

This Announcement includes statements that are, or may be deemed to be, "forward-looking statements".  These forward- looking statements can be identified by the use of forward-looking terminology, including the terms "believes", "estimates", "forecasts", "plans", "prepares", "anticipates", "projects", "expects", "intends", "may", "will", "seeks", "should" or, in each case, their negative or other variations or comparable terminology, or by discussions of strategy, plans, objectives, goals, future events or intentions.  These forward-looking statements include all matters that are not historical facts.  They appear in a number of places throughout this Announcement and include statements regarding the Company's and the Directors' intentions, beliefs or current expectations concerning, amongst other things, the Company's prospects, growth and strategy.  By their nature, forward-looking statements involve risks and uncertainties because they relate to events and depend on circumstances that may or may not occur in the future.  Forward-looking statements are not guarantees of future performance.  The Company's actual performance, achievements and financial condition may differ materially from those expressed or implied by the forward-looking statements in this Announcement.  In addition, even if the Company's results of operations, performance, achievements and financial condition are consistent with the forward-looking statements in this Announcement, those results or developments may not be indicative of results or developments in subsequent periods.  Any forward-looking statements that the Company makes in this Announcement speak only as of the date of such statement and (other than in accordance with their legal or regulatory obligations) neither the Company, nor the Joint Bookrunners nor any of their respective associates, directors, officers or advisers undertakes any obligation to update such statements.  Comparisons of results for current and any prior periods are not intended to express any future trends or indications of future performance, unless expressed as such, and should only be viewed as historical data.

Liberum is authorised and regulated by the Financial Conduct Authority (the "FCA") in the United Kingdom and is acting exclusively for the Company and no one else in connection with the Placing or any other matters referred to in this Announcement, and Liberum will not be responsible to anyone (including any Placees) other than the Company for providing the protections afforded to its clients or for providing advice in relation to the Placing or any other matters referred to in this Announcement.

Berenberg, which is authorised and regulated by the German Federal Financial Supervisory Authority and in the United Kingdom is deemed authorised under the Temporary Permissions Regime and subject to limited regulation by the FCA, is acting exclusively for the Company in connection with the Placing and will not be acting for any other person (including any Placees) and will not be responsible to any person other than the Company for providing the protections afforded to clients of Berenberg or for advising any other person in respect of the matters referred to in this Announcement.

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 Joint Bookrunners or by any of its affiliates or agents as to, or in relation to, the accuracy or completeness of this Announcement or any other written or oral information made available to or publicly available to any interested party or its advisers, and any liability therefor is expressly disclaimed.

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

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

 

The New Ordinary Shares to be issued pursuant to the Capital Raising will not be admitted to trading on any stock exchange other than the AIM market of the London Stock Exchange.

 

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.

 

Information to Distributors

 

UK product governance

 

Solely for the purposes of the product governance requirements contained within of Chapter 3 of the FCA Handbook Production 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 Placing Shares have been subject to a product approval process, which has determined that such securities are: (i) compatible with an end target market of investors who meet the criteria of retail investors and investors who meet the criteria of professional clients and eligible counterparties, each as defined in paragraph 3 of the FCA Handbook Conduct of Business Sourcebook; and (ii) eligible for distribution through all distribution channels (the "Target Market Assessment").  Notwithstanding the Target Market Assessment, distributors (for the purposes of UK Product Governance Requirements) should note that: (a) the price of the Placing Shares may decline and investors could lose all or part of their investment; (b) the Placing Shares offer no guaranteed income and no capital protection; and (c) an investment in the Placing Shares is compatible only with investors who do not need a guaranteed income or capital protection, who (either alone or in conjunction with an appropriate financial or other adviser) are capable of evaluating the merits and risks of such an investment and who have sufficient resources to be able to bear any losses that may result therefrom.  The Target Market Assessment is without prejudice to the requirements of any contractual, legal or regulatory selling restrictions in relation to the Placing.  Furthermore, it is noted that, notwithstanding the Target Market Assessment, the Joint Bookrunners will only procure investors who meet the criteria of professional clients and eligible counterparties.

 

For the avoidance of doubt, the Target Market Assessment does not constitute: (a) an assessment of suitability or appropriateness for the purposes of Chapter 9A or 10A respectively of the FCA Handbook Conduct of Business Sourcebook; or (b) a recommendation to any investor or group of investors to invest in, or purchase, or take any other action whatsoever with respect to the Placing Shares.

 

Each distributor is responsible for undertaking its own target market assessment in respect of the Placing Shares and determining appropriate distribution channels.

 

EEA product governance

 

Solely for the purposes of the product governance requirements contained within: (a) EU Directive 2014/65/EU on markets in financial instruments, as amended ("MiFID II"); (b) Articles 9 and 10 of Commission Delegated Directive (EU) 2017/593 supplementing MiFID II; and (c) local implementing measures in the European Economic Area (together, the "MiFID II Product Governance Requirements"), and disclaiming all and any liability, whether arising in tort, contract or otherwise, which any "manufacturer" (for the purposes of the MiFID II Product Governance Requirements) may otherwise have with respect thereto, the Placing Shares have been subject to a product approval process, which has determined that the Placing Shares are: (i) compatible with an end target market of (a) retail investors, (b) investors who meet the criteria of professional clients and (c) eligible counterparties, each as defined in MiFID II; and (ii) eligible for distribution through all distribution channels as are permitted by MiFID II (the "Target Market Assessment").  Notwithstanding the Target Market Assessment, distributors should note that: the price of the Placing Shares may decline and investors could lose all or part of their investment; the Placing Shares offer no guaranteed income and no capital protection; and an investment in the Placing Shares is compatible only with investors who do not need a guaranteed income or capital protection, who (either alone or in conjunction with an appropriate financial or other adviser) are capable of evaluating the merits and risks of such an investment and who have sufficient resources to be able to bear any losses that may result therefrom.  The Target Market Assessment is without prejudice to the requirements of any contractual, legal or regulatory selling restrictions in relation to the Placing.  Furthermore, it is noted that, notwithstanding the Target Market Assessment, the Joint Bookrunners will only procure investors who meet the criteria of professional clients and eligible counterparties.

 

For the avoidance of doubt, the Target Market Assessment does not constitute: (a) an assessment of suitability or appropriateness for the purposes of MiFID II; or (b) a recommendation to any investor or group of investors to invest in, or purchase, or take any other action whatsoever with respect to the Placing Shares.

 

Each distributor is responsible for undertaking its own target market assessment in respect of the Placing Shares and determining appropriate distribution channels.

 

The following is an extract from the Chairman's letter to be set out in substantially the same form in the Circular.

 

INTRODUCTION

 

The Company is pleased to announce a conditional Placing to raise gross proceeds of approximately £1.7 million, and an associated Open Offer to raise gross proceeds of up to approximately £1.7 million, in each case at a price of 28 pence per New Ordinary Share. Certain Directors have also conditionally agreed to subscribe directly with the Company for, in aggregate, 78,570 New Ordinary Shares at the Issue Price.

 

The net proceeds of the Capital Raising are expected to be utilised to drive Ilika's roadmap for its Goliath solid-state battery projects. In particular, the net proceeds of the Placing are expected to be utilised to: i) support the development of Goliath technology, with grant assistance; ii) provide capital expenditure to increase the battery testing capacity from 20 kWh/a to 0.75 MWh/a, and to upgrade existing dry room facilities in order to install the automated assembly line contracted through the SiSTEM project. Proceeds in excess of the Capital raising target would be used to add further dry room facilities & testing capacity to support Goliath and to develop Stereax product roadmap in collaboration with Cirtec Medical Corporation ("Cirtec").

 

All of the net proceeds of the Open Offer and the Director Subscriptions will be used to further support the Group's working capital requirements.

 

The Directors are of the opinion, the net proceeds of the Capital Raising will further strengthen the balance sheet (cash and cash equivalents as at 30 April 2024 in excess of £11 million) and provide working capital beyond 12 months from the date of this announcement.

 

The Capital Raising is conditional upon, inter alia, the passing of the Resolutions at the General Meeting. Applications will be made in due course to the London stock exchange for the New Ordinary Shares to be admitted to trading on AIM. Admission is expected to become effective and dealings in the Placing Shares, the Open Offer Shares and the Director Subscription Shares are expected to commence on 31 May 2024.

 

If the conditions relating to the issue of the Placing Shares are not satisfied or the Placing Agreement is terminated in accordance with its terms, the Placing Shares will not be issued and the Company will not receive the related placing monies. In this scenario, the Open Offer and the Director Subscriptions will similarly not proceed.

 

The Issue Price represents a discount of approximately 5.1 per cent. to the mid-market price of 29.5 pence per Existing Ordinary Share on 9 May 2024, being the latest practicable date prior to the publication of this Announcement.

 

BACKGROUND TO, AND REASONS FOR, THE CAPITAL RAISING

Ilika is an independent global expert in solid-state battery technology.

Solid state batteries are a variant of lithium-ion batteries which does not contain a toxic liquid electrolyte, providing higher safety combined with competitive performance compared to incumbent technology. The Company's primary activities focus on, 1) commercialising its miniature Stereax technology for use in medical technology and Industrial Internet of Things ("IIoT") through its manufacturing collaboration with Cirtec and 2) collaborating with automotive partners, supported by UK government agencies, to develop its Goliath technology for use in electric vehicles ("EVs"). Designs of conventional large format lithium-ion cells are reaching their maximum theoretical energy density of 300-350 Wh/kg. Solid state cell designs offer the promise of theoretical energy densities of 450-500 Wh/kg depending on the choice of architecture and materials. Developers around the world are designing and making prototype solid state cells that are gradually increasing in energy density. These new designs are expected to yield energy densities that will exceed conventional lithium-ion cells and move towards the theoretical limit of such designs over the next five years.

Solid-state cells have a number of environmental benefits over traditional lithium-ion cells. Currently, only 5 per cent. of lithium-ion cells are recycled and yet they are environmentally harmful due to liquid electrolyte toxicity and the risk of fire and explosions. Traditional lithium-ion cells cannot be landfilled or incinerated. In contrast, solid-state cells present no risk of explosion from a flammable electrolyte and commonly available process technologies can be used for recycling, including the oxide electrolytes preferred by Ilika's cells.

The Company has an asset-light business model, in which Ilika develops intellectual property ("IP") defining active materials, cell architecture and manufacturing process, which it licenses to manufacturing partners in return for license fees and royalties. In order to validate its IP, Ilika produces initial batches of its products on pilot lines for customer evaluation. Ilika does not aim to invest in large scale manufacturing facilities, as it believes its processes can be better scale-up through targeted manufacturing partnerships.

In August 2023, Ilika signed a ten-year manufacturing licence with Cirtec to produce the Stereax range of mm-scale batteries at Cirtec's facility in Lowell, Massachusetts. Ilika is now focused on advanced technology development and IP licensing in support of Cirtec's manufacturing and commercialisation activities. This partnership is reinforcing Cirtec's ongoing activities in system level miniaturisation for the medical device industry.

The Company's Goliath technology development path is aligned with the EV revolution currently taking place, as annual sales accelerate to meet international commitments to reduce carbon emissions. The Company is able to utilise the experience gained from Stereax to help with the scale-up of the Goliath programme. In December 2023, the Company reached its intermediate technology development target of lithium-ion energy density parity in its Goliath large format EV battery programme. This achievement validated the technical approach taken by the Company and supports the justification for investment in a full-pilot facility configured to demonstrate that the technology can be licensed for third-party giga-scale implementation.

In July 2021, Ilika completed a placing, retail offer and open offer raising approximately £24.7 million, allowing the Company to accelerate the development of the Company's Goliath technology. Correspondingly, Ilika has achieved substantial technical validation milestones, most recently through the D4 development point (the first prototype for customer release) and lithium-ion energy density (a demonstrative approach that the technology can be licensed for third-party giga-scale implementation). These milestones were reached in November 2023 and December 2023 respectively, highlighting the progress in achieving the objective of Minimum Viable Product status ("MVP") in 2025-2026. As the Goliath technology continues to develop to reach MVP status, Ilika looks to commercialise the process through partnerships with OEMs in order to deploy the batteries on a giga-scale production basis.

In March 2020, Ilika completed a placing and open offer raising £15.1 million, allowing the Company to support the implementation of initial Stereax manufacturing in the UK. Following process and product qualification, initial product was shipped to customers in May 2023.

Reflective of the vision to step up production capacity and scalability, Ilika had entered into a memorandum of understanding with Cirtec in January 2023. Ilika and Cirtec followed that up with a 10-year licencing and royalty agreement in August 2023, whereby Ilika's focus shifted to support Cirtec's manufacturing and commercialisation activities through advanced technology development and IP licensing. Accordingly, this deal served to significantly de-risk Ilika's mm-scale product offering, whilst allowing the Company to place a greater focus on its high structurally growth driven Goliath technology.

Given the accelerating demand and addressable market for EVs, underpinned by government policies worldwide, scaling Goliath continues to present a large opportunity for the Company. The Company's Goliath technology development path is aligned with the EV revolution currently taking place, as annual sales accelerate to meet international commitments to reduce carbon emissions. The Company is able to utilise the experience gained from its Stereax technology to help with the scale-up of the Goliath programme.

The development path for Goliath is strongly aligned to the market growth within the EV sector, and there are a number of structural drivers, primarily through challenging environmental pressures, that is leading to increased consumer purchases of battery electric vehicles. According to the Climate Action Tracker, there are currently around 145 countries considering net zero targets, countries who currently cover close to 90 per cent. of global emissions. Correspondingly, a GOV.UK 2023 study highlighted transport as the largest emitting sector, underpinning the rationale for government policy to continue the shift towards electric mobility. In 2023, the UK Government set out targets, with an overarching goal to reach zero emission vehicles by 2035, with a shorter-term focus of 80 per cent. of new car purchases to be zero emission by 2030. These governmental pressures are noticeably a catalyst to the recent strong momentum of worldwide EV sales. Accordingly, electric car sales in 2023 were 3.5 million higher than in 2022, a 35 per cent.  year-on-year increase. This is more than six times higher than in 2018, just 5 years earlier. In 2023, there were over 250 000 new registrations per week, which is more than the annual total in 2013, ten years earlier. Electric cars accounted for around 18 per cent.  of all cars sold in 2023, up from 14 per cent.  in 2022 and only 2 per cent.  5 years earlier, in 2018. These trends indicate that growth remains robust as electric car markets mature. This positive market dynamic provides a compelling backdrop to Goliath's offering of longer range, increased safety and competitive performance versus traditional, liquid-electrolyte-based lithium-ion cells.

Ilika expects that the commercial adoption of its Goliath technology will also include high value consumer appliance applications such as hair straighteners, curling tongs and cleaning appliances, which can also benefit from some of the unique properties of solid-state batteries.

Following key significant technological developments in the Goliath product development through the aforementioned milestones, Ilika, in April 2024 announced a collaboration with Agratas, a subsidiary of the Tata Group. This collaboration, inclusive of two significant news developments, is firstly represented through Agratas joining the 17-month £2.7 million grant supported Project SiSTEM project, a project which Ilika has been participating in since October 2023. Running in parallel with Project HISTORY, the inclusion of Agratas is envisaged to support Ilika's scale up of the Goliath SSB large-format pouch cell, whereby the objectives are to build a 1.5MWh solid-state battery assembly line in collaboration with MPAC. In addition to joining the SiSTEM project, Ilika and Agratas have entered into a 12-month technology collaboration agreement that will facilitate interactions between the companies to support Ilika's journey to its D8 (50Ah, chemistry frozen) development milestone in H1 2025, alongside exploring wider collaboration opportunities between the two parties. Given Agratas's strategy to build a battery gigafactory, with a vision to power hundreds of thousands of electric cars, there is a strong opportunity for further collaboration, whereby both companies can leverage their respective expertise and resources for continued and material Goliath development.

£0.75 million of the gross proceeds of the Placing are expected to be used to fund the development of Goliath technology, building on the achievement of lithium-ion battery equivalence in December 2023. Supplemented by expected government grant support, the proceeds will support the development of Goliath technology to support partner collaboration.

As Ilika develops larger Goliath prototypes with state-of-the-art materials, the Company has a need to increase its battery testing capacity from 20 kWh/a to 0.75 MWh/a and to upgrade its dry room facilities, accounting for £0.75 million of the proceeds.

In line with its asset-light business model, Ilika will demonstrate its Goliath technology at pilot scale (1.5 MWh/a) to underpin licensing discussions and technology transfer.

CURRENT TRADING AND PROSPECTS

 

Ilika's "Capital Markets Day and Trading Update" was announced via a Regulatory Information Service on 23 April 2024, and contained the following statements:

 

•     Trading for the year ended 30 April 2024 has been in line with current market expectations;

•     The Company expects to generate revenue of approximately £2.0m for FY 2024 (FY 2023: £0.8m). This figure is reflective of a material increase in grant funding received during H1 of the current financial year and, as expected, this was not replicated in H2 due to the phasing of grant activity.; and

•     Cash and cash equivalents at 30 April 2024 are expected to be higher than expected and approximately £11.0 million due to the grant funding income and cost reduction activity resulting from the Cirtec contract and technology transfer activity.

 

Ilika's unaudited half-year report for the six months ended 31 October 2023 was announced via a Regulatory Information Service on 23 January 2024 and contained the following statements:

 

Operating Highlights

During the period, significant progress has been made with transferring manufacturing of Ilika's thin-film Stereax miniature solid-state batteries (SSBs) for powering medical devices and industrial wireless sensors in specialist environments, and developing its large-format Goliath cells for electric vehicles (EV) and cordless appliances.

 

Financial highlights for H1 2024

(i)        Total revenue for the period of £1.3m (H1 2023: £0.2m)

·    Grant funding of £1.3m (H1 2023: £0.2m)

(ii)       EBITDA loss, excluding share-based payments, of £1.9m (H1 2023: £4.1m loss)

(iii)      Cash & Cash equivalents at period end of £13.2m (H1 2023: £18.6m)

 

 

Outlook

(i)        Signed contract with Cirtec represents most immediate commercialisation opportunity, allowing fulfilment of order book and creating further opportunities for commercial engagement.

(ii)       Well-developed plans to move Ilika's Goliath roadmap to the next stage, MVP, aiming to reach the D8 development milestone by the end of the HISTORY programme grant in Q1 2025, underpinning licencing opportunities.

(iii)      First half of calendar year 2024 Ilika will manufacture and test batches of pouch cells based on the D4 development point prior to delivering fully characterised P1 cells to customers.

(iv)      Plans to increase the capacity of the Company's existing pre-pilot production facility using automation and larger scale items of equipment.

(v)       Targets to reach an installed capacity of 1.5 MWh/a to allow Ilika to scale production volumes and mature its technology to the level required to respond to automotive requests for quotation by the end of 2025.

(vi)      Commercial interest and government grant support expected to intensify as the Goliath product continues to mature.

 

DETAILS OF THE PLACING

 

The Company  intends to raise gross proceeds of approximately £1.7 million by means of the Placing. The Placing Shares, in aggregate, will represent approximately 3.75 per cent. of the Existing Ordinary Shares on 9 May 2024, the latest practicable date prior to the publication of this Announcement. The aggregate net proceeds after costs related to the Placing are expected to be approximately £1.5 million.

 

The Joint Bookrunners' obligations under the Placing Agreement in respect of the Placing are conditional, inter alia, upon:

 

(i)        the Placing Agreement becoming unconditional in all respects (save for any condition relating to Admission) and not having been terminated in accordance with its terms prior to Admission; and

(ii)       Admission becoming effective by no later than 8.00 a.m. on 31 May 2024 (or such later time and/or date (being no later than 8.00 a.m. on the Long Stop Date) as the Joint Bookrunners and the Company may agree).

 

If any of the conditions above are not satisfied, the Placing Shares will not be issued.

 

The Placing Shares are not subject to clawback. The Placing is not being underwritten.

 

The Placing Shares will be issued free of all liens, charges and encumbrances and will, when issued, be fully paid, and rank pari passu in all respects with the Existing Ordinary Shares, including the right to receive dividends and other distributions declared, paid or made after the date of their issue.

 

Subject to, inter alia, the passing of the Resolutions, application will be made to the London Stock Exchange, by means of the Application, for the admission of the Placing Shares, the Open Offer Shares and the Director Subscription Shares to trading on AIM. Admission is expected to occur and dealings are expected to commence in the Placing Shares, the Open Offer Shares and the Director Subscription Shares at 8.00 a.m. on 31 May 2024. If Admission does not occur, then the Company will not receive the relevant net proceeds in respect of Admission and the Company may not be able to finance the activities it intends to utilise the net proceeds of the Placing for, as described in this Announcement, and may have to seek additional funding.

 

DIRECTOR SUBSCRIPTIONS

 

The following Directors intend to subscribe for New Ordinary Shares in the following amounts and pursuant to the Director Subscription Agreements:

 

Director	Existing beneficial shareholding	New Ordinary Shares subscribed for	Shareholding on completion of the Capital Raising	Shareholding as a percentage of the Enlarged Issued Share Capital
Graeme Purdy	782,927	53,571	836,498	0.49%
Jason Stewart	0	7,142	7,142	0.00%
Keith Jackson	102,142	17,857	119,999	0.07%

 

DETAILS OF THE OPEN OFFER

 

The Company considers it important that Qualifying Shareholders have an opportunity (where it is practicable for them to do so) to participate at the same price per New Ordinary Share as investors in the Placing and, accordingly, the Company is making the Open Offer to Qualifying Shareholders. The Company is proposing to raise a maximum of approximately £1.7 million (before expenses) (assuming full take up of the Open Offer shall be less than the €8.0 million maximum amount permitted without requiring the publication by the Company of a prospectus under the Prospectus Regulation Rules Sourcebook) through the issue of up to 6,114,449 Open Offer Shares.

 

The Open Offer Shares are available to Qualifying Shareholders (including Qualifying Shareholders who are also participants in the Placing) pursuant to the Open Offer at the Issue Price, payable in full on acceptance. The Issue Price represents a discount of approximately 5.1 per cent. to the closing mid-market price of 29.5 pence per Existing Ordinary Share on 9 May 2024, being the latest practicable date prior to the publication of this Announcement. Any Open Offer Shares not applied for by Qualifying Shareholders will be available to other Qualifying Shareholders under the Excess Application Facility.

 

Qualifying Shareholders may apply for Open Offer Shares under the Open Offer pro rata to their holdings of Existing Ordinary Shares as at the Record Date at the Issue Price on the following basis:

 

1 Open Offer Share for every 26 Existing Ordinary Shares held by the Qualifying Shareholder on the Record Date

 

Entitlements of Qualifying Shareholders to apply for Open Offer Shares will be rounded down to the nearest whole number of Open Offer Shares. Fractional entitlements which would otherwise arise will not be issued to Qualifying Shareholders but will be aggregated and made available under the Excess Application Facility. The Excess Application Facility enables Qualifying Shareholders to apply for Excess Shares in excess of their Open Offer Entitlements. Not all Shareholders will be Qualifying Shareholders. Shareholders who are located in, or are citizens of, or have a registered office in, Restricted Jurisdictions will not qualify to participate in the Open Offer.

 

Valid applications by Qualifying Shareholders will be satisfied in full up to their Open Offer Entitlements. Applicants can apply for less or more than their Open Offer Entitlements but the Company cannot guarantee that any application for Excess Shares under the Excess Application Facility will be satisfied as this will depend, in part, on the extent to which other Qualifying Shareholders apply for less than or more than their own Open Offer Entitlements. The Company may satisfy valid applications for Excess Shares of applicants in whole or in part but reserves the right not to satisfy any excess above any Open Offer Entitlement. The Board may scale back applications made in excess of Open Offer Entitlements on such basis as it reasonably considers to be appropriate.

 

Qualifying Shareholders should note that the Open Offer is not a rights issue and therefore the Open Offer Shares which are not applied for by Qualifying Shareholders will not be sold in the market for the benefit of Qualifying Shareholders who do not apply under the Open Offer. The Application Form will not constitute a document of title and will not be able to be traded or otherwise transferred.

 

The Open Offer is subject to the satisfaction, inter alia, of the following conditions on or before 31 May 2024 (or such later date (being no later than the Long Stop Date) as the Joint Bookrunners and the Company may agree):

 

(i)        the Placing becoming unconditional in all respects (save for any condition relating to Admission);

(ii)       the passing of the Resolutions at the General Meeting (or any adjournment thereof); and

(iii)      Admission becoming effective by 8.00 a.m. on 31 May 2024 (or such later time and/or date (being no later than 8.00 a.m. on the Long Stop Date) as the Joint Bookrunners and the Company may agree).

 

Accordingly, if the above conditions are not satisfied, the Open Offer will not proceed and the Open Offer Shares will not be issued and all monies received by the Receiving Agent will be returned to the applicants (at the applicant's risk and without interest) as soon as possible but, in any event, within 14 days thereafter. Any Open Offer Entitlements admitted to CREST will thereafter be disabled.

 

The Open Offer Shares will be issued free of all liens, charges and encumbrances and will, when issued, be fully paid, and rank pari passu in all respects with the Placing Shares and the Existing Ordinary Shares, including the right to receive dividends and other distributions declared, paid or made after the date of their issue.

 

Application will be made to the London Stock Exchange, by means of the Application, for the admission of the Open Offer Shares to trading on AIM. Admission is expected to occur and dealings are expected to commence in the Open Offer Shares at 8.00 a.m. on 31 May 2024.

 

Application has been made for the Open Offer Entitlements to be admitted to CREST. It is expected that such Open Offer Entitlements will be credited to CREST stock accounts on 14 May 2024. Application has also been made for the Excess CREST Open Offer Entitlements to be admitted to CREST and it is also expected that such Excess CREST Open Offer Entitlements will be credited to CREST stock accounts on 14 May 2024. The Open Offer Entitlements and Excess CREST Open Offer Entitlements will be enabled for settlement in CREST until 11.00 a.m. on 28 May 2024.

 

Applications through the CREST system may only be made by the Qualifying CREST Shareholder originally entitled or by a person entitled by virtue of a bona fide market claim. The Open Offer Shares must be paid for in full on application.

 

The latest time and date for receipt of completed Application Forms or CREST instructions and payment in respect of the Open Offer is 11.00 a.m. on 28 May 2024. The Open Offer is not being made to certain Overseas Shareholders.

 

The procedure for application and payment depends on whether, at the time at which such application and payment is made, a Qualifying Shareholder has an Application Form in respect of their Open Offer Entitlement or has their Open Offer Entitlement credited to their stock account in CREST.

 

USE OF PROCEEDS

The net proceeds of the Capital Raising are expected to be utilised to drive Ilika's roadmap for its Goliath solid-state battery projects.

In particular, the net proceeds of the Placing are expected to be utilised to:

i)    support Goliath technology, with grant assistance; and

ii)   provide capital expenditure to increase the battery testing capacity from 20 kWh/a to 0.75 MWh/a, and to upgrade existing dry room facilities in order to install the automated assembly line contracted through the SiSTEM project,

Proceeds in excess of the Capital Raising target would be used to add further dry room facilities and testing capacity to support Goliath and to develop Stereax product roadmap in collaboration with Cirtec.

The Directors are of the opinion, the net proceeds of the Capital Raising will further strengthen the balance sheet (cash and cash equivalents as at 30 April 2024 in excess of £11 million) and provide working capital beyond 12 months from the date of this Announcement.

EFFECTS OF THE CAPITAL RAISING

 

Upon Admission, and assuming full take up of Open Offer Entitlements, the Enlarged Issued Share Capital is expected to be 171,161,544 Ordinary Shares. On this basis, the New Ordinary Shares will represent approximately 7.1 per cent. of the Enlarged Issued Share Capital.

Following the issue of the New Ordinary Shares pursuant to the Capital Raising, assuming full take up of Open Offer Entitlements, Qualifying Shareholders who neither take up any of their Open Offer Entitlements nor participate in the Placing will suffer a dilution of approximately 7.1 per cent. to their interests in the Company. If a Qualifying Shareholder takes up their Open Offer Entitlement in full, but does not participate in the Placing, they will suffer a dilution of approximately 3.5 per cent. to their interest in the Company.

The Directors have concluded that proceeding with the Capital Raising is the most suitable option available to the Company for raising additional funds through the issue of the New Ordinary Shares and that issuing the New Ordinary Shares at a discount is fair and reasonable so far as all existing Shareholders are concerned. The Issue Price has been set by the Joint Bookrunners, after consultation with the Company, following their assessment of market conditions and following discussions with a number of institutional investors.

GENERAL MEETING

 

The Directors currently have existing authorities to allot shares and dis-apply pre-emption rights under section 551 and section 570 of the Act which were obtained at the Company's annual general meeting held on 20 September 2023. However, these are insufficient to enable the Company to allot and issue the full amount of New Ordinary Shares pursuant to the Capital Raising. Accordingly, in order for the Company to allot and issue the New Ordinary Shares, the Company needs to first obtain approval from its Shareholders to grant to the Board additional authority to allot the New Ordinary Shares and to dis-apply statutory pre-emption rights which would otherwise apply to such allotment. The Company is therefore also seeking Shareholder authority to increase the Directors' general authority to allot securities and dis-apply pre-emption rights pursuant to sections 551 and 570 of the Act, respectively.

Set out at the end of the Circular is the Notice of the General Meeting to be held at the offices of Eversheds Sutherland (International) LLP at One Wood Street, London EC2V 7WS at 11.00 a.m. on 29 May 2024, at which the Resolutions will be proposed.

If any Resolution is not passed by the Shareholders at the General Meeting, the Capital Raising will not proceed. The Resolutions can be summarised as follows:

·     Resolution 1 - this will be proposed as an ordinary resolution (requiring a simple majority of votes in favour) and seeks the approval of Shareholders to authorise the Directors to allot the New Ordinary Shares in connection with the Capital Raising; and

·     Resolution 2 - this will be proposed as a special resolution (requiring the approval of at least 75 per cent. of the votes cast) and seeks the approval of Shareholders to authorise the Directors to dis-apply pre-emption rights in connection with the allotment of the New Ordinary Shares in connection with the Capital Raising. This authority is being sought to allow the Directors to issue New Ordinary Shares on a non pre-emptive basis in connection with the Capital Raising. Whilst Shareholders may apply for Open Offer Shares under the Open Offer pro rata to their holdings of Existing Ordinary Shares, this resolution is nevertheless required to deal with, inter alia, Excess Open Offer Entitlements and other practical issues in the context of the Open Offer, in particular, in relation to fractional entitlements to Open Offer Shares and legal and/or practical restrictions under the laws of certain territories or the requirements of relevant regulatory bodies or stock exchanges.

 

Save in respect of the allotment of the New Ordinary Shares, the grant of options to employees under employee share plans or other similar incentive arrangements and pursuant to any exercise of existing options in respect of Ordinary Shares (including in relation to the proposed exercise of options by certain Directors referred to in paragraph 11 below), the Directors have no current intention to allot shares, or rights to subscribe or convert into shares, in the capital of the Company.

APPENDIX 1

 

RISK FACTORS

 

In addition to the other information set out in this Announcement, the risks described below should be carefully considered by investors prior to making any investment decision relating to the Ordinary Shares. The risks set out below are those risks which the Directors consider to be material as at the date of this Announcement, but do not necessarily comprise all those risks associated with an investment in the Ordinary Shares or the Company and are not intended to be presented in any assumed order of priority. There may be additional risks that the Directors do not currently consider to be material or of which the Directors are not aware, which may affect the Group's financial condition, performance, prospects, results and/or the price of the Ordinary Shares.

 

An investment in the Ordinary Shares involves significant risks and uncertainties and investors may lose a substantial portion, or even all, of the money that they invest in the Company. An investment in the Company is therefore only suitable for financially sophisticated investors who are capable of evaluating the merits and risks of such an investment and who have sufficient resources to be able to bear losses (which may equal the whole amount invested) that may result from such an investment. An investment in the Ordinary Shares should constitute part of a diversified investment portfolio. Typical investors are expected to be professionally advised private investors and professional investors. Prospective investors should review carefully and evaluate the risks and other information contained in this Announcement before making a decision to invest in the Ordinary Shares.

1.        GENERAL RISKS

An investment in the Company is only suitable for investors capable of evaluating the risks and merits of such investment and who have sufficient resources to bear any loss which may result from the investment. A prospective investor should consider with care whether an investment in the Company is suitable for them in the light of their personal circumstances and the financial resources available to them.

 

Investment in the Company should not be regarded as short-term in nature. There can be no guarantee that any appreciation in the value of the Ordinary Shares will occur or that the objectives of the Company will be achieved. Investors may not get back the full amount initially invested.

 

The prices of shares and income derived from them can go down as well as up. Past performance is not necessarily a guide to future performance.

 

2.        RISKS RELATING TO THE SECTOR IN WHICH THE GROUP OPERATES

2.1       Regulatory risk

The Group's products and materials are subject to various European and other legislative and regulatory requirements. Failure to satisfy such requirements could result in the imposition of sanctions on members of the Group, including fines, injunctions, civil penalties, import bans, delays, suspensions or withdrawals of approvals, licence revocations, seizures or recalls of products, operating restrictions and criminal prosecutions, any of which could materially harm the Company's product development and commercialisation efforts. Legislative changes in, or regulatory reform of, the relevant sectors in the countries in which the Group operates or in which the end-products are sold may also affect the Group's ability to sell products and materials profitably or at all. Furthermore, the Company and its partners may not be successful in securing regulatory approval in a timely manner, or at all, for materials and products that may be developed in the future. Any or a combination of these factors could have a material adverse effect on the Group's business, financial condition and results of operations.

 

2.2    The Group is largely dependent on its partners to commercialise the end-products containing the Group's materials

The Group's ability to develop future products largely depends on its ability to maintain existing relationships with its commercialisation partners (such as Cirtec) and enter into relationships with new commercialisation partners. In addition, the majority of the Group's development programmes are dependent on its commercialisation partners successfully marketing the end-products of which the Group's materials are an integral component. There can be no guarantee that partners:

(a)     will fulfil their obligations to the Group (for example, they may not prioritise Ilika's products over other product lines); or

(b)     will continue to manufacture sufficient quantities of the Group's finished end-products on a timely basis, at an acceptable cost or at all (for example, notwithstanding that the Group may have entered into such binding contractual commitments, utilise production capacity not being used at any time for the manufacture of the Group's products for the manufacture of third parties' products, which, in each case, may potentially inhibit the Group's ability to produce and commercialise its products and/or to increase or scale-up the manufacture and commercialisation of its products in line with its growth strategy and/or increase the costs to the Group of producing its products, all of which could have a material adverse impact on the Group's operations, financial position and ability to pursue its growth strategy).

 

Furthermore, there is a limited number of companies which have the scale and technological capability to manufacture the Group's products and/or to create and develop the new markets that some of the Group's materials may enable. Accordingly, the Group is exposed to the risk of its commercialisation partners being acquired by third parties who may cease to contract with the Group on an ongoing basis or, in the case of an overseas acquirer, potentially transfer the commercialisation partner's manufacturing technology overseas or otherwise prevent the Group from being able to access it, which, again, could have a material adverse impact on the Group's operations, financial position and ability to pursue its growth strategy.

 

2.3       Protection of the Group's intellectual property rights

Policing unauthorised use of the Group's technology is difficult and expensive. The Group relies to great extent on patent protection for its inventions but there can be no assurance that the steps the Group takes will prevent misappropriation of, or prevent an unauthorised third party from obtaining or using, the technologies which the Company relies on. Many of the Group's patent applications for its existing inventions are still pending. In addition, effective protection may be unavailable or limited in some jurisdictions.

 

Also, no assurance can be given that the Group will develop products which are patentable or that patents will be sufficiently broad in their scope to provide protection for the Group's intellectual property rights against third parties.

 

The Group also relies upon unpatented proprietary technology, processes, know-how and in-house software. The Group has confidentiality agreements in place with customers, partners, suppliers and employees who have access to its proprietary information and know-how but such agreements may be breached and the Group may not have adequate remedies for any breach. Finally, the Group's trade secrets may become known otherwise or be independently developed by competitors.

 

Any misappropriation of the Group's proprietary technology and intellectual property could have a negative impact on the Group's business and its operating results. Litigation may be necessary in the future to enforce or protect the Group's rights or to determine the validity or scope of the proprietary rights of others. Litigation could cause the Group to incur substantial costs and divert resources and management attention away from its daily business and there can be no guarantees as to the outcome of any such litigation.

 

2.4       The Group may inadvertently infringe a third party's intellectual property rights

Although the Group believes that its technologies do not currently infringe upon patents held by others, no assurance can be given that such infringements do not exist or will not exist in the future. The Group may be unaware of filed patent applications and issued patents that could include claims covering the Company's products. There is a risk that the Group may inadvertently infringe a patent held by another party. In order to mitigate this risk, the Company engages external patent attorneys and technical consultants when appropriate. Further, there can be no assurances that others have not developed, or will not develop, similar or competing products, duplicate any of the products of the Group or design around any pending patent application or patents (if any) subsequently granted in favour of the Group. Parties making claims of infringement may be able to obtain injunctive or other equitable relief that could effectively block the Group's ability to sell or supply its products or to license its technology and could cause the Group to pay substantial royalties, licensing fees or damages or incur substantial costs in redesigning those products that contain the allegedly infringing intellectual property or in obtaining alternative technology. There can be no assurance that the Group will be able to obtain alternative technology on a timely basis or, if any licences are required, that the Group will be able to obtain any such licence on commercially favourable terms, if at all. This may have a material adverse effect on the Group and its ability to compete.

 

The defence of any lawsuit could divert management's efforts and attention from ordinary business operations and result in time-consuming and expensive litigation, regardless of the merits of such claims, which could materially and adversely affect the Group's business, results of operations and financial condition. Any potential intellectual property litigation could also involve the Group losing the opportunity to license its technology to others or to collect royalty payments based upon successful protection and assertion of its intellectual property against others. In addition, the Group may be required to develop alternative non-infringing solutions that may require significant time and substantial unanticipated resources. There can be no assurance that such claims will not have a material adverse effect on the Group's business, financial condition or results.

 

2.5       The Group is exposed to potential product liability

Some of the Group's activities expose it to potential product liability and professional indemnity risks, as well as litigation and reputational risks, which are inherent in the development and manufacture of its products and future products. Any product liability claim brought against the Group, with or without merit, could result in the increase of the Group's product liability insurance rates or the inability to secure coverage in the future. There can be no assurance that the necessary insurance cover will be available to the Group at a commercially acceptable cost or that, in the event of any claim, the level or extent of insurance carried by the Group now or in the future will be adequate, or that a product liability or other claim would not materially and/or adversely affect the business of the Group.

 

2.6    Contravention of environmental and safety regulation could have an adverse impact on the Group

The Company's operations, including its development facilities, are subject to environmental and safety laws and regulations, including those governing the use of hazardous materials. The cost of compliance with these and similar future regulations could be substantial. Although the Directors believe that the Group's procedures comply with applicable regulations, the risk of accidental contamination or injury from such materials cannot be eliminated. In the event of an incident, the resulting liabilities could have an adverse impact on the Group. Similarly, many of the Company's suppliers, collaborators and customers are subject to similar laws and regulations. Contravention of these laws and regulations by such parties could have an adverse impact on the Group.

 

3.        RISKS RELATING TO THE GROUP'S BUSINESS AND OPERATIONS

3.1       The Group is reliant on core technology and development

If any part of the Group's technology suffers a technical malfunction, the Group's ability to continue operations and perform work for customers and partners may be affected. If faults and breakdowns cannot be rectified in a timely and economic manner, these factors could have a material adverse effect on the Group's business, financial condition and results of operations.

 

The Group has limited capacity to run experiments and process data. If capacity constraints lead to development programme delays and termination of contracts with customers, this could have a material adverse effect on the Group's business, financial condition and results of operations. The Group's current development capacity limits the number of new projects and partners with which it can work.

 

3.2    The Group has historically been loss making and its future capital needs are uncertain and may necessitate the need to raise additional funds in the future

The Group has historically been loss making and there can be no certainty when, or if, profitability or positive operating cash flow will be achieved. Further the Group cannot be certain of its future financing needs or that suitable financing will be available in the required amounts or on acceptable terms. The Group's future capital needs, and other business reasons at that time, may require the Company to issue additional equity or obtain a credit facility. If additional equity or equity-linked securities were to be issued this may result in the dilution of existing Shareholders' holdings. The incurrence of indebtedness would result in increased debt service obligations and could result in operating and financing covenants that would restrict the Group's operations or the Group's ability to pay dividends to Shareholders or, in the worst scenario, it may not be able to continue operations. Whilst the Directors believe that the net proceeds of the Placing will improve the working capital position of the Company, there can be no guarantee that the amount raised will be sufficient to result in an unqualified audit opinion in the upcoming audit.

 

3.3       The Group may not achieve anticipated revenues or growth

The Group's future success will depend on the ability of the Directors to implement their objectives and strategy. Whilst the Directors are confident about the Group's prospects, there is no certainty that anticipated revenues or growth can be achieved. The Group has over 10 years of operating history but this may not be operating experience upon which its performance and prospects during its anticipated expansion can be properly compared and evaluated against and it has experienced operating losses in each year since its formation. The Group's ability to become and remain profitable depends on a number of factors, including, in particular, being able to find and contract with appropriate partners and customers. The rapidly evolving markets in which the Company sells its products, its limited experience and progress in winning partners and customers, as well as other factors, make it difficult for the Group to forecast revenues accurately. As a result, the Group could experience budgeting and cash flow management problems, unexpected fluctuations in its results of operations and other difficulties, any of which would make it difficult for the Group to gain and maintain profitability. Potential investors should be aware of the risks associated with an investment in companies with limited trading histories. There can be no assurance that the Group will operate profitably, produce a reasonable return, if any, on investment, or remain solvent. If the Group's strategy proves unsuccessful, Shareholders could lose all or part of their investment.

 

3.4       Management of the Group's growth strategy

There can be no certainty that the Group will be able to implement successfully its stated strategy. The ability of the Group to implement its strategy in rapidly evolving and competitive markets will require effective management planning and operational controls. The Directors anticipate that significant expansion will be required to respond to market opportunities. The Group's growth plans may place a significant strain on the Group's management, operational, financial and personnel resources. The Group's future growth and prospects will depend on its ability to manage this growth and to continue to expand and improve operational and financial performance, whilst at the same time maintaining effective cost controls. The Group's future growth may depend, in part, on its ability to identify suitable acquisition targets. There can be no assurance that any targets identified will be available at a value which makes them suitable for acquisition at the relevant time, or that third party finance required to fund the acquisition will be available on acceptable terms. Any failure to expand and improve operational, financial and quality control systems in line with the Group's growth could have a material adverse effect on the Group's business, financial condition and results of operations.

 

3.5       The Group's competitors may take actions which adversely affect its financial condition

The Company faces competition from other companies within its industry and, in addition, there is a risk that the Group's commercialisation partners, and potential commercialisation partners, may elect to undertake in-house the technology and product development that the Group currently operates for them instead of partnering with the Group. There may also be products and competitors that the Group is currently unaware of that could have a detrimental effect on the business performance of the Group. There can be no assurance that the Group's current and future competitors will not develop superior technology, offer superior products to the Group, sell products at a lower price to the Group, or achieve greater market acceptance in the Group's target markets, or precede the Group in receiving any necessary regulatory approvals, which may render one or more of the Group's technologies or products obsolete and/or otherwise uncompetitive.

 

Technologies and products developed by the Group may have a shorter commercial life than anticipated, if any, due to the invention or development of more successful technologies or products by competitors. Competitors of the Group may have longer operating histories, greater name recognition, access to larger customer bases and significantly greater financial, research, development, sales and marketing, operational, manufacturing, distribution and personnel resources than the Group. As a result, such competitors may be able to respond more quickly and effectively to changing customer demands or to devote greater resources to the development, promotion and sale of their products than the Company can, giving them a competitive advantage. While the Directors are confident that the Group's technologies and products are generally well-protected by its patent portfolio and by the Company's proprietary know-how and expertise, there can be no assurance that new technology and new competitive products or solutions will not emerge, or that they will not be equally or more attractive than the Group's products or solutions and therefore threaten the Group's market position. There can be no assurance that the Group will be able to compete successfully with existing or new competitors and, if that proves to be the case, this may have an adverse effect on the Group's business, financial condition and results.

 

3.6       The Group is dependent on technology and product development

Although the Group has successfully completed the initial development of several products, continued research and development of additional products will be required. There can be no assurance that any of the Group's product candidates will be successfully developed or commercialised. The Group may encounter delays and incur additional development and production costs and expenses, over and above those expected by the Directors, in order to develop products at sufficient quality and low enough cost for future partnership. Furthermore, there can be no assurance that any of the Group's developed products will successfully complete any applicable regulatory certification or clinical testing process or that they will meet the regulatory and production requirements necessary for commercial distribution. If the Group's development programme is curtailed due to any of the above issues, this may have an adverse material effect on the Group's business and financial conditions.

 

The Group's success and ability to compete are dependent on underlying technologies which the Group has developed or may develop in the future. There is a risk that the technology that the Group has developed or may develop in the future may not work as well as planned or that the marketing of the technology may not be as successful as the Group hopes. Furthermore, the markets in which the Group and its commercialisation partners compete, or plan to compete, are characterised by constantly and rapidly changing technologies and technological obsolescence. The Group's ability to compete successfully depends on the technological and creative skill of the Company's personnel, consultants and contractors and their ability to design, develop, manufacture, assemble, test, market and support new products and enhancements on a timely and cost-effective basis to satisfy the demands and expectations of customers. There is no assurance that the Group will be able to do this. Any failure to anticipate technological changes, to develop, use or procure new technologies, or to react to changes in existing technologies could materially delay its development of new products or enhancements, which could result in product obsolescence, loss of revenue opportunities and customer migration, negatively affecting the Group's financial results.

 

3.7       Dependence on key executives and personnel

The Group's development and prospects are dependent upon training and retaining qualified professional, scientific and technical operating staff. In particular, the Group's success depends to a significant degree upon the vision, technical and specialist skills, experience, performance, and continued service of its Directors, senior management and other key personnel. Whilst the Group has entered into contractual arrangements with these individuals with the aim of securing the services of each of them, retention of these services cannot be guaranteed and the loss of the services of any of the Directors, senior management or key personnel may have a material adverse effect on the Group and its commercial and financial performance and damage the value of an investment in the Ordinary Shares.

 

3.8       Ability to recruit and retain skilled personnel

The ability to continue to attract and retain employees with the appropriate expertise and skills cannot be guaranteed. Identifying and hiring any additional personnel and replacements could be costly and might require the Group to grant significant equity awards or other incentive compensation, which could adversely impact its financial results, and there can be no assurance that the Group will have sufficient financial resources. Effective product development and innovation, upon which the Group's success is dependent, is in turn dependent upon attracting and retaining talented technical, engineering and marketing personnel, who represent a significant asset and serve as the source of the Company's technological and product innovations. In addition, to expand the Company's customer base and increase sales, the Group will need to hire additional qualified sales personnel. If the Group is unable to hire, train and retain such personnel in a timely manner, the development and introduction of the Group's products could be delayed and its ability to sell its products and otherwise to grow its business will be impaired and such delay and inability may have a detrimental effect upon the performance of the Group.

 

3.9       The success of the Group's present business model is, in part, dependent on third parties

The Group relies on a number of relationships, including key relationships with Cirtec who provide a clear route to market for Stereax® and Agratas who recently joined Ilika's Goliath industrialisation programme. The termination of these relationships could restrict the Group's workflow capacity and/or ability to develop new techniques and solutions to technical problems. Any of these factors could have a material adverse effect on the business, financial condition, results of operations and cash-flows of the Group.

 

In addition, the Group is reliant on a small number of partners for its joint development programmes as well as a relatively small number of suppliers of parts used in the design and build of the bespoke equipment installed, or to be installed, in its third party fabrication facilities (such as that provided by Cirtec). Failure to deliver products to such customers and partners or the termination by any of these customers, partners or suppliers of their agreements with the Group or any of such customers, partners or suppliers becoming insolvent, being acquired by third parties or otherwise ceasing to trade with the Group for any reason or significant increases in prices charged by the Group's parts and/or equipment suppliers as a consequence of increased demand, for example, could therefore have a material adverse effect on the business, financial condition, results of operations and cash-flows of the Group.

 

The Group is reliant on grant funding administered by UK Government agencies including the Faraday Battery Challenge, Innovate UK and the Advanced Propulsion Centre. Grants are awarded through competitions and there is no guarantee of success in future competitions, nor the availability of such competitions.

 

3.10     The Group may be subject to force majeure risks

The Group's operations now or in the future may be adversely affected by risks outside the control of the Group such as labour unrest, civil disorder, war, terrorist attacks, subversive activities or sabotage including cyber attacks, fires, floods, explosions or other catastrophes, epidemics including the Coronavirus (COVID-19) outbreak or quarantine restrictions.

 

3.11     The Group's disaster recovery plans may not be sufficient

The Group depends on the performance, reliability and availability of its laboratory and pilot line equipment and information technology systems. Any damage to or failure of its equipment and/or systems could result in disruptions to the Group's research and operations. The Group's disaster recovery plans may not adequately address every potential event and its insurance policies may not cover any loss in full or in part (including losses resulting from business interruptions) or damage that it suffers fully or at all, which could have a material adverse effect on the Group's business, financial position or prospects.

 

3.12     The Group's counterparties may become insolvent

There is a risk that parties with whom the Group trades or has other business relationships (including partners, customers, suppliers and other parties) may become insolvent. This may be as a result of general economic conditions or factors specific to that company. In the event that a party with whom the Group trades becomes insolvent, this could have an adverse impact on the revenues and profitability of the Group.

 

3.13     Financial risk

There are a number of financial risks which are outside the control of the Group and which can affect revenues and/or costs. The Group does not fully hedge against such risks currently. These include varying international exchange rates, interest rates, world commodity prices, energy prices and supplies, raw materials prices and supplies, inflation and international trends in trade, tariffs and protectionism and changes in the legal and regulatory framework. The Group's operations, business and financial performance are affected by these factors, which are beyond the control of the Group.

 

3.14     Tax risk

Any change in the Group's tax status or in taxation legislation in the UK could affect the Group's ability to provide returns to Shareholders. Statements in this Announcement concerning the taxation of investors in shares are based on current law and practice, which is subject to change. The taxation of an investment in the Group depends on the individual circumstances of investors.

 

The nature and amount of tax which members of the Group expect to pay and the reliefs expected to be available to any member of the Group are each dependent upon a number of assumptions, any one of which may change and which would, if so changed, affect the nature and amount of tax payable and reliefs available. In particular, the nature and amount of tax payable is dependent on the availability of relief under tax treaties and is subject to changes to the tax laws or practice in any of the jurisdictions affecting the Group. Any limitation in the availability of relief under these treaties, any change in the terms of any such treaty or any changes in tax law, interpretation or practice could increase the amount of tax payable by the Group.

 

4.        RISKS RELATING TO THE CAPITAL RAISING AND THE ORDINARY SHARES

4.1    The price of the Ordinary Shares may fluctuate significantly and investors could lose all or part of their investment

The share price of AIM companies can be highly volatile, which may prevent Shareholders from being able to sell their Ordinary Shares at or above the price they paid for them. The Issue Price may not be indicative of prices that will prevail in the trading market and investors may not be able to resell the Ordinary Shares at or above the price they paid for them. The market price and the realisable value for the Ordinary Shares could fluctuate significantly for various reasons, many of which are outside the Group's control. In addition, the published market price of the Ordinary Shares will be, typically, their middle market price. Due to the potential difference between the middle market price of the Ordinary Shares and the price at which the Ordinary Shares can be sold, there is no guarantee that the realisable value of the Ordinary Shares will be the same as the published market price.

 

4.2    There may not be a liquid secondary market for the Ordinary Shares, the price of which may fluctuate significantly, and Shareholders could lose all or part of their investment

The Company is currently traded on AIM which is perceived to involve a higher degree of risk and to be less liquid than the Official List. Shareholders do not have a right for their Ordinary Shares to be redeemed and the Company does not have a fixed winding-up date. Those Shareholders wishing to realise their investment will be required to dispose of their Ordinary Shares on the stock market or vote to wind-up the Company. Admission should not be taken as implying that there will be a liquid market for the New Ordinary Shares. There is no guarantee that an active market will arise or be sustained for the Ordinary Shares. If an active trading market is not maintained, the liquidity and trading price of the Ordinary Shares could be adversely affected. Even if an active trading market is maintained, the market price for the Ordinary Shares may fall below their original issue price and Shareholders may not realise their initial investment.

 

4.3       There is no guarantee that dividends will be paid by the Company

Any dividend on the Ordinary Shares will be limited by the Group's performance. As the Company has not yet generated a profit, it has not yet paid any dividends to Shareholders. The Company continues to keep its dividend policy under review and may revise it from time to time as its business develops. As a holding company, the Company's ability to pay dividends in the future will be affected by a number of factors, principally the Company's generation of distributable profits and the receipt of sufficient dividends from its subsidiaries. The Group's members may be precluded from paying dividends by various factors, such as their own financial condition, restrictions in existing or future financing documents to which they are party or applicable law. Under English law, a company can only pay dividends to the extent that it has distributable reserves and cash available for this purpose. In addition, the Company may not pay dividends if the Directors believe this would cause the Company to be inadequately capitalised or if, for any other reason, the Directors conclude it would not be in the best interests of the Company. Any of the foregoing could limit the payment of dividends to Shareholders or, if the Company does pay dividends, the amount of such dividends.

 

4.4       Shareholders may suffer dilution as a consequence of the Capital Raising

Regardless of whether a Qualifying Shareholder takes up their entitlements under the Open Offer, the effect of the Capital Raising will be a reduction of their proportionate ownership and voting interests in the Company (unless a Shareholder applies for, and obtains, Excess Shares under the Open Offer).

 

For those Qualifying Shareholders who do not participate in the Open Offer, their proportionate ownership and voting interest in the Company will be reduced further as a consequence of the Open Offer. In particular, to the extent that Qualifying Shareholders do not take up the offer of Open Offer Shares under the Open Offer, their proportionate ownership and voting interest in the Company will be further reduced and the percentage that their shareholdings represent of the ordinary share capital of the Company will, following Admission, be reduced accordingly.

 

Subject to certain exceptions, Qualifying Shareholders in the United States and other Restricted Jurisdictions will not be able to participate in the Open Offer.

 

4.5    Future issuances of Ordinary Shares may dilute the holdings of Shareholders and may depress the price of the Ordinary Shares

Other than in connection with the Capital Raising or pursuant to employee share plans or other similar incentive arrangements, the Company has no current plans for an offering of Ordinary Shares. However, it is possible that the Company may decide to offer additional Ordinary Shares in the future. Future sales or the availability for sale of substantial amounts of Ordinary Shares in the public market could dilute the holdings of Shareholders, adversely affect the prevailing market price of the Ordinary Shares and impair the Company's ability to raise capital through future offerings of equity securities.

 

4.6    Importance of passing the Resolutions to complete the Capital Raising

The Resolutions to be proposed at the General Meeting will be proposed as an ordinary resolution and a special resolution and, to be passed, will require the support of, in the case of the ordinary resolution, a simple majority of the total voting rights of Shareholders who (being entitled to do so) vote on such resolution at the General Meeting and in relation to the special resolution, three-quarters of the total voting rights of Shareholders who (being entitled to do so) vote on such resolution at the General Meeting. The Capital Raising is conditional, inter alia, on the passing of the Resolutions.

 

In the event that the Resolutions are not passed, the Company will not be able to proceed with the Capital Raising, with the result that the anticipated net proceeds of the Capital Raising will not become available to fund proposed upcoming expenditure and achieve the objectives currently being pursued by the Board. The Group's business plan and growth prospects may also be adversely affected as a result.

 

 

 

APPENDIX 2

 

EXPECTED TIMETABLE OF PRINCIPAL EVENTS

 

 

Open Offer Record Date	6.00 p.m. on 9 May 2024
Announcement of the Capital Raising	10 May 2024
Date Existing Ordinary Shares marked 'ex-entitlement' by  the London Stock Exchange	8.00 a.m. on 13 May 2024
Expected date of the Circular and of the posting of the Circular, Application Forms and Forms of Proxy	13 May 2024
Open Offer Entitlements and Excess Open Offer Entitlements credited to CREST stock accounts of Qualifying CREST Shareholders	14 May 2024
Recommended latest time and date for requesting withdrawal of Open Offer Entitlements and Excess Open Offer Entitlements from CREST	4.30 p.m. on 21 May 2024
Latest time and date for depositing Open Offer Entitlements and/or Excess Open Offer Entitlements into CREST	3.00 p.m. on 22 May 2024
Latest time and date for splitting Application Forms (to satisfy bona fide market claims in relation to Open Offer Entitlements only)	3.00 p.m. on 23 May 2024
Latest time and date for receipt of completed Forms of Proxy and receipt of electronic proxy appointments via CREST	11.00 a.m. on 24 May 2024
Latest time and date for receipt of completed Application Forms and payment in full under the Open Offer or settlement of the relevant CREST instructions (as appropriate)	11.00 a.m. on 28 May 2024
General Meeting	11.00 a.m. on 29 May 2024
Results of the General Meeting and the Open Offer expected to be announced through a Regulatory Information Service	29 May 2024
Expected date for Admission and commencement of dealings in the Placing Shares, the Open Offer Shares and any Director Subscription Shares	8.00 a.m. on 31 May 2024
Expected date on which CREST accounts to be credited with Placing Shares, Open Offer Shares and Director Subscription Shares in uncertificated form	As soon as possible following Admission
Expected date for despatch of definitive share certificates in respect of Placing Shares, Open Offer Shares and Director Subscription Shares to be issued in certificated form	Within 14 days of Admission
Long Stop Date	8.00 a.m. on 30 June 2024

 

Notes:

(1)    References to times in this Announcement are to London time (unless otherwise stated).

(2)    Each of the times and dates above are indicative only and are subject to change. If any of the above times and/or dates change, the revised times and/or dates will be notified by the Company to the Shareholders by announcement through a Regulatory Information Service.

(3)    Admission and the commencement of dealings in the New Ordinary Shares on AIM are conditional on, inter alia, the passing of the Resolutions at the General Meeting.

 

 

APPENDIX 3

 

DEFINITIONS

 

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

 

"Act"	the Companies Act 2006
"Admission"	admission of the Placing Shares, the Open Offer Shares and the Director Subscription Shares to trading on AIM becoming effective in accordance with the AIM Rules
"AIM"	the market of that name operated by the London Stock Exchange
"AIM Rules"	the AIM Rules for Companies published by the London Stock Exchange from time to time
"Announcement"	this announcement, including the appendices, published by the Company in connection with the Capital Raising
"Application"	the application to the London Stock Exchange for Admission as required by Rule 29 of the AIM Rules
"Application Form"	the personalised application form accompanying the Circular (where appropriate) pursuant to which Qualifying Non-CREST Shareholders (other than certain Overseas Shareholders) may apply to subscribe for Open Offer Shares under the Open Offer
"Berenberg"	Joh. Berenberg, Gossler & Co. KG, London Branch
"Board" or "Directors"	the board of directors of the Company
"Bookbuild"	the accelerated bookbuild which will be launched immediately following this Announcement
"Capital Raising"	the Placing, the Open Offer and the Director Subscriptions
"Circular"	a circular to be published by the Company and sent to shareholders of the Company shortly after the close of the Bookbuild containing further details of the Capital Raising and convening the General Meeting in order to pass the Resolutions
"Cirtec"	Cirtec Medical Corporation
"Company" or "Ilika"	Ilika plc
"CREST" or "CREST system"	the relevant system (as defined in the CREST Regulations) for the paperless settlement of trades and the holding of uncertificated securities operated by Euroclear
"CREST Participant"	a person who is, in relation to CREST, a system-participant (as defined in the CREST Regulations)
"CREST Regulations"	the Uncertificated Securities Regulations 2001 (SI2001/3755)
"CREST Sponsor"	a CREST Participant admitted to CREST as a CREST Sponsor
"Director Subscriptions"	the subscriptions to be made at the Issue Price by, or on behalf, the following Directors
	(a) Graeme Purdy, in respect of 53,571 New Ordinary Shares;
	(b) Keith Jackson, in respect of 17,857 New Ordinary Shares; and
	(c) Jason Stewart, in respect of 7,142 NewOrdinary Shares.
"Director Subscription Agreements"	the subscription agreements to be entered into between the Company and each of the Directors subscribing for Director Subscription Shares
"Director Subscription Shares"	the 78,570 New Ordinary Shares to be issued pursuant to the Director Subscriptions
"Enlarged Issued Share Capital"	the issued ordinary share capital of the Company immediately following each Admission
"EVs"	electric vehicles
"Euroclear"	Euroclear UK & International Limited, the operator of CREST
"Excess Application Facility"	the arrangement pursuant to which Qualifying Shareholders may apply for any number of Open Offer Shares in excess of their Open Offer Entitlement provided that they have agreed to take up their Open Offer Entitlement in full in accordance with the terms and conditions of the Open Offer
"Excess CREST Open Offer Entitlement"	in respect of each Qualifying CREST Shareholder, the entitlement (in addition to their Open Offer Entitlement) to apply for Open Offer Shares pursuant to the Excess Application Facility, which is conditional on them taking up their Open Offer Entitlement in full and which may be subject to scaling back in accordance with the provisions of set out in the Circular
"Excess Open Offer Entitlement"	in respect of each Qualifying Shareholder, the entitlement (in addition to their Open Offer Entitlement) to apply for Open Offer Shares pursuant to the Excess Application Facility, which is conditional on them taking up their Open Offer Entitlement in full and which may be subject to scaling back in accordance with the provisions set out in the Circular
"Excess Shares"	Open Offer Shares applied for by Qualifying Shareholders under the Excess Application Facility
"Ex-entitlement Date"	the date on which the Existing Ordinary Shares are marked "ex" for entitlement under the Open Offer, being 8.00 a.m. on 13 May 2024
"Existing Ordinary Shares"	the 158,975,667 existing Ordinary Shares in issue as at 9 May 2024, being the last practicable date before the publication of this Announcement
"FCA"	the Financial Conduct Authority
"Form of Proxy"	the form of proxy for use by Shareholders in connection with the General Meeting and accompanying the Circular
"FSMA"	the Financial Services and Markets Act 2000
"General Meeting"	the general meeting of the Company to be held at the offices of Eversheds Sutherland (International) LLP at One Wood Street, London EC2V 7WS at 11.00 a.m. on 29 May 2024, or any adjournment thereof, notice of which is set out at the end of the Circular
"Group"	the Company and its subsidiary undertakings from time to time
"IIoT"	Industrial Internet of Things
"Issue Price"	the price at which the New Ordinary Shares are to be allotted and issued pursuant to the Capital Raising, being 28 pence per New Ordinary Share
"Joint Bookrunners"	Liberum and Berenberg
"kWh"	kilowatt hour
"Liberum"	Liberum Capital Limited
"London Stock Exchange"	London Stock Exchange plc
"Long Stop Date"	30 June 2024
"Member Account ID"	the identification code or number attached to any member account in CREST
"Money Laundering Regulations"	the Money Laundering, Terrorist Financing and Transfer of Funds (Information on the Payer) Regulations 2017 (as amended), the money laundering provisions of the Criminal Justice Act 1993, the Proceeds of Crime Act 2002 and the Criminal Finances Act 2017
"MVP"	Minimum Viable Product
"MWh"	megawatt hour
"New Ordinary Shares"	the Placing Shares, the Open Offer Shares and the Director Subscription Shares
"Notice of the General Meeting"	the notice of the General Meeting to be set out at the end of the Circular
"OEMs"	original equipment manufacturer
"Official List"	the Official List of the FCA
"Open Offer"	the conditional invitation to be made by the Company to Qualifying Shareholders to subscribe for the Open Offer Shares at the Issue Price on the terms and subject to the conditions set out in Part 5 of the Circular and, in the case of Qualifying Non-CREST Shareholders, in the Application Form accompanying the Circular
"Open Offer Entitlement"	the pro rata basic entitlement of a Qualifying Shareholder, pursuant to the Open Offer, to apply to subscribe for 1 Open Offer Share for every 26 Existing Ordinary Shares registered in its name as at the Record Date
"Open Offer Record Date" or "Record Date"	the record date in relation to the Open Offer, being 6.00 p.m.  on 9 May 2024
"Open Offer Shares"	up to 6,114,449 new Ordinary Shares to be issued by the Company to Qualifying Shareholders pursuant to the Open Offer
"Ordinary Shares"	ordinary shares of £0.01 each in the capital of the Company
"Overseas Shareholders"	Shareholders with registered addresses in, or who are citizens, residents or nationals of, jurisdictions outside of the UK
"Placees"	means a Relevant Person (including individuals, funds or others) by whom or on whose behalf a commitment to take up the Placing Shares has been given and who has been invited to participate in the Placing by the Joint Bookrunners
"Placing"	the conditional placing by the Joint Bookrunners, as agents for the Company, of the Placing Shares at the Issue Price on the terms and conditions set out in the Placing Agreement
"Placing Shares"	up to 6,071,428 new Ordinary Shares proposed to be allotted and issued by the Company to certain persons for cash pursuant to the terms and subject to the conditions set out in the Placing Agreement which are not the Director Subscription Shares
"Qualifying CREST Shareholders"	Qualifying Shareholders whose Existing Ordinary Shares on the register of members of the Company on the Record Date are held in uncertificated form
"Qualifying Non-CREST Shareholders"	Qualifying Shareholders whose Existing Ordinary Shares on the register of members of the Company on the Record Date are held in certificated form
"Qualifying Shareholders"	Shareholders on the register of members of the Company on the Record Date with the exclusion (subject to exemptions) of persons with a registered address or located or resident in a Restricted Jurisdiction
"Receiving Agent"	Computershare Investor Services PLC
"Regulatory Information Service"	a service approved by the FCA for the distribution to the public of regulatory announcements and included within the list maintained on the FCA's website
"Resolutions"	the resolutions to be set out in the Notice of the General Meeting
"Restricted Jurisdiction"	any jurisdiction where local laws or regulations may result in a significant risk of civil, regulatory or criminal exposure for the Company if information or documentation concerning the proposals set out in this Announcement is sent or made available to Shareholders in that jurisdiction including, without limitation, the United States of America, Canada, Australia, New Zealand, Japan and the Republic of South Africa
"uncertificated" or "in uncertificated form"	recorded on the relevant register of Ordinary Shares 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"	the United Kingdom of Great Britain and Northern Ireland
"United States" or "US"	the United States of America, each state thereof, its territories
"US Securities Act"	the US Securities Act of 1933, as amended from time to time
"Wh/kg"	watt-hour per kilogram
"£", "pounds sterling",	are references to the lawful currency of the United Kingdom
"pence" or "p"

 

 

 

APPENDIX 4

TERMS AND CONDITIONS OF THE PLACING

 

IMPORTANT INFORMATION FOR INVITED PLACEES ONLY REGARDING THE PLACING.

MEMBERS OF THE PUBLIC ARE NOT ELIGIBLE TO TAKE PART IN THE PLACING.  THIS ANNOUNCEMENT (INCLUDING THIS APPENDIX) AND THE TERMS AND CONDITIONS SET OUT HEREIN (TOGETHER, THIS "ANNOUNCEMENT") ARE DIRECTED ONLY AT PERSONS WHOSE ORDINARY ACTIVITIES INVOLVE THEM IN ACQUIRING, HOLDING, MANAGING AND DISPOSING OF INVESTMENTS (AS PRINCIPAL OR AGENT) FOR THE PURPOSES OF THEIR BUSINESS AND WHO HAVE PROFESSIONAL EXPERIENCE IN MATTERS RELATING TO INVESTMENTS AND ARE (1) IF IN A MEMBER STATE OF THE EUROPEAN ECONOMIC AREA ("EEA"), QUALIFIED INVESTORS AS DEFINED IN ARTICLE 2(E) OF REGULATION (EU) 2017/1129 (THE "EU PROSPECTUS REGULATION"); (2) IF IN THE UNITED KINGDOM, QUALIFIED INVESTORS AS DEFINED IN ARTICLE 2(E) OF REGULATION (EU) 2017/1129 AS IT FORMS PART OF UNITED KINGDOM DOMESTIC LAW BY VIRTUE OF THE EUROPEAN UNION (WITHDRAWAL) ACT 2018 (THE "EUWA") (THE "UK PROSPECTUS REGULATION") WHO (A) FALL WITHIN ARTICLE 19(5) OF THE FINANCIAL SERVICES AND MARKETS ACT 2000 (FINANCIAL PROMOTION) ORDER 2005, AS AMENDED (THE "ORDER") (INVESTMENT PROFESSIONALS) OR (B) FALL WITHIN ARTICLE 49(2)(A) TO (D) (HIGH NET WORTH COMPANIES, UNINCORPORATED ASSOCIATIONS, ETC.) OF THE ORDER; AND (3) OTHERWISE, PERSONS TO WHOM IT IS OTHERWISE LAWFUL TO COMMUNICATE IT TO (ALL SUCH PERSONS TOGETHER BEING REFERRED TO AS "RELEVANT PERSONS").

 

THIS ANNOUNCEMENT AND THE INFORMATION IN IT MUST NOT BE ACTED ON OR RELIED ON BY PERSONS WHO ARE NOT RELEVANT PERSONS.  PERSONS DISTRIBUTING THIS ANNOUNCEMENT MUST SATISFY THEMSELVES THAT IT IS LAWFUL TO DO SO.  ANY INVESTMENT OR INVESTMENT ACTIVITY TO WHICH THIS ANNOUNCEMENT RELATES IS AVAILABLE ONLY TO RELEVANT PERSONS AND WILL BE ENGAGED IN ONLY WITH RELEVANT PERSONS.  THIS ANNOUNCEMENT DOES NOT ITSELF CONSTITUTE AN OFFER FOR SALE OR SUBSCRIPTION OF ANY SECURITIES IN ILIKA PLC.

 

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

 

THIS ANNOUNCEMENT (INCLUDING THIS APPENDIX) AND THE INFORMATION CONTAINED HEREIN IS RESTRICTED AND IS NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, IN WHOLE OR IN PART, DIRECTLY OR INDIRECTLY, IN OR INTO OR FROM THE UNITED STATES, AUSTRALIA, NEW ZEALAND, CANADA, THE REPUBLIC OF SOUTH AFRICA OR JAPAN OR ANY OTHER JURISDICTION IN WHICH SUCH RELEASE, PUBLICATION OR DISTRIBUTION WOULD BE UNLAWFUL.

 

THIS ANNOUNCEMENT IS NOT FOR PUBLICATION OR DISTRIBUTION, DIRECTLY OR INDIRECTLY, IN OR INTO THE UNITED STATES.  THIS ANNOUNCEMENT IS NOT AN OFFER OF SECURITIES FOR SALE OR SUBSCRIPTION INTO THE UNITED STATES.  THE SECURITIES REFERRED TO HEREIN HAVE NOT BEEN AND WILL NOT BE REGISTERED UNDER THE SECURITIES ACT AND MAY NOT BE OFFERED OR SOLD IN THE UNITED STATES, EXCEPT PURSUANT TO AN APPLICABLE EXEMPTION FROM REGISTRATION.  NO PUBLIC OFFERING IS BEING MADE IN THE UNITED STATES.

 

The distribution of this Announcement, the Placing and/or the issue or sale of the Placing Shares in certain jurisdictions may be restricted by law.  No action has been taken by the Company, either of the Joint Bookrunners or any of their respective affiliates, agents, directors, partners (persönlich haftende Gesellschafter), officers or employees (together "Representatives") that would permit an offer of the Placing Shares or possession or distribution of this Announcement or any other offering or publicity material relating to such Placing Shares in any jurisdiction where action for that purpose is required.  Persons into whose possession this Announcement comes are required by the Company and the Joint Bookrunners to inform themselves about and to observe any such restrictions.

 

This Announcement or any part of it is for information purposes only and does not constitute or form part of any offer to issue or sell, or the solicitation of an offer to acquire, purchase or subscribe for, any securities in the United States, Australia, New Zealand, Canada, the Republic of South Africa or Japan or any other jurisdiction in which the same would be unlawful.  No public offering of the Placing Shares is being made in any such jurisdiction.

 

All offers of the Placing Shares in the United Kingdom or the EEA will be made pursuant to an exemption from the requirement to produce a prospectus under the UK Prospectus Regulation or the EU Prospectus Regulation, as appropriate.  In the United Kingdom, this Announcement is being directed solely at persons in circumstances in which section 21(1) of the Financial Services and Markets Act 2000 (as amended) (the "FSMA") does not require the approval of the relevant communication by an authorised person.

 

The Placing Shares have not been approved or disapproved by the US Securities and Exchange Commission, any state securities commission or other regulatory authority in the United States, nor have any of the foregoing authorities passed upon or endorsed the merits of the Placing or the accuracy or adequacy of this Announcement.  Any representation to the contrary is a criminal offence in the United States.  The relevant clearances have not been, nor will they be, obtained from the securities commission of any province or territory of Canada, no prospectus has been lodged with, or registered by, the Australian Securities and Investments Commission or the Japanese Ministry of Finance; the relevant clearances have not been, and will not be, obtained from the South Africa Reserve Bank or any other applicable body in the Republic of South Africa in relation to the Placing Shares and the Placing Shares have not been, nor will they be, registered under or offered in compliance with the securities laws of any state, province or territory of the United States, Australia, New Zealand, Canada, the Republic of South Africa or Japan.  Accordingly, the Placing Shares may not (unless an exemption under the relevant securities laws is applicable) be offered, sold, resold or delivered, directly or indirectly, in or into the United States, Australia, New Zealand, Canada, the Republic of South Africa or Japan or any other jurisdiction outside the United Kingdom.

 

Persons (including, without limitation, nominees and trustees) who have a contractual right or other legal obligations to forward a copy of this Announcement should seek appropriate advice before taking any such action.

 

This Announcement should be read in its entirety.  In particular, you should read and understand the information provided in the "Important Notices" section of this Announcement.

 

By participating in the Bookbuilding Process and the Placing, each Placee will be deemed to have read and understood this Announcement in its entirety, to be participating, making an offer and acquiring Placing Shares on the terms and conditions contained herein and to be providing the representations, warranties, indemnities, acknowledgements and undertakings contained in this Appendix.

 

EACH PLACEE SHOULD CONSULT WITH ITS OWN ADVISERS AS TO LEGAL, REGULATORY, TAX, BUSINESS AND RELATED ASPECTS OF A SUBSCRIPTION FOR THE PLACING SHARES.

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

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

 

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

 

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

 

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

 

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

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

 

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

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

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

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

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

 

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

 

5.    it understands (or if acting for the account of another person, such person has confirmed that such person understands) the resale and transfer restrictions set out in this Appendix;

 

6.    except as otherwise permitted by the Company and subject to any available exemptions from applicable securities laws, it (and any account referred to in paragraph 5 above) is outside of the United States acquiring the Placing Shares in offshore transactions as defined in and in accordance with Regulation S under the Securities Act; and

 

7.    the Company and the Joint Bookrunners will rely upon the truth and accuracy of the foregoing representations, warranties, acknowledgements, undertakings and agreements.

No prospectus

 

The Placing Shares are being offered to a limited number of specifically invited persons only and will not be offered in such a way as to require any prospectus or other offering document to be published.  No prospectus or other offering document has been or will be submitted to be approved by the FCA in relation to the Placing or the Placing Shares and Placees' commitments will be made solely on the basis of the information contained in this Announcement and subject to any further terms set forth in the contract note to be sent to individual Placees.

 

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

 

Details of the Placing Agreement and the Placing Shares

The Joint Bookrunners have today entered into a placing agreement (the "Placing Agreement") with the Company under which, on the terms and subject to the conditions set out in the Placing Agreement, the Joint Bookrunners, as agents for and on behalf of the Company, have agreed to use their respective reasonable endeavours to procure Placees for the Placing Shares.  The Placing is not being underwritten.

 

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

 

As part of the Placing, the Company has agreed that it will not, for a period of 120 days after (but including) Admission, allot, issue, offer, sell, contract to sell or issue, grant any option, right or warrant to subscribe for or purchase or otherwise dispose of or create any interest or equity of any person (including any right to acquire, option or right of pre-emption or conversion) or any mortgage, charge, pledge, lien, assignment, hypothecation, security interest, title retention, or any other security agreement or arrangement, or any agreement to create any of the foregoing over, directly or indirectly, any "equity securities" (as defined in the Companies Act) (or any securities convertible into or exchangeable for equity securities or which carry rights to subscribe or purchase equity securities) or any interest in any equity securities or agree to do any of such things or undertake any other transaction with the same economic effect as any of the foregoing or announce an offering of Ordinary Shares or any interest therein or to announce publicly any intention to enter into any transaction described above. This agreement is subject to certain customary exceptions and does not prevent the allotment and issue of the Open Offer Shares pursuant to the Open Offer, the grant or exercise of options under any of the Company's existing share incentives and share option schemes, or following Admission the issue by the Company of any Ordinary Shares upon the exercise of any right or option or the conversion of a security already in existence.

 

Conditions to the Placing

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

 

The obligations of the Joint Bookrunners under the Placing Agreement are, and the Placing is, conditional upon, inter alia:

a.    the passing of the Resolutions at the General Meeting (or any adjournment thereof);

b.    the Placing Agreement becoming unconditional in all respects (save for any condition relating to Admission) and not having been terminated in accordance with its terms prior to Admission;

c.     the Company having allotted, subject only to Admission, the Placing Shares in accordance with the Placing Agreement; and

d.    Admission having become effective at or before 8.00 a.m. on 31 May 2024 or such later time as the Joint Bookrunners may agree with the Company (not being later than 8.00 a.m. on the Long Stop Date),

 

(all conditions to the obligations of the Joint Bookrunners included in the Placing Agreement being together, the "Conditions").

 

If any of the Conditions set out in the Placing Agreement is not satisfied or, where permitted, waived in accordance with the Placing Agreement within the stated time periods (or such later time and/or date as the Company and the Joint Bookrunners may agree), or the Placing Agreement is terminated in accordance with its terms, the Placing will lapse and the Placees' rights and obligations shall cease and terminate at such time and each Placee agrees that no claim can be made by or on behalf of the Placee (or any person on whose behalf the Placee is acting) in respect thereof.

 

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

 

The Joint Bookrunners may, in their absolute discretion and upon such terms as they think fit, waive satisfaction of all or any of the Conditions in whole or in part, or extend the time provided for satisfaction of one or more Conditions, save that certain Conditions including the Condition relating to Admission referred to in paragraph (d) above may not be waived.  Any such extension or waiver will not affect Placees' commitments as set out in this Appendix.

 

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

 

Neither Joint Bookrunner nor any of its respective affiliates nor the Company shall have any liability to any Placee (or to any other person whether acting on behalf of a Placee or otherwise) in respect of any decision any of them may make as to whether or not to waive or to extend the time and/or date for the satisfaction of any Condition nor for any decision any of them may make as to the satisfaction of any Condition or in respect of the Placing generally and by participating in the Placing each Placee agrees that any such decision is within the absolute discretion of the Joint Bookrunners.

 

In consideration for their services in relation to the Placing and Admission and conditional upon completion of the Placing, the Joint Bookrunners will be paid a commission based on the aggregate value of the Placing Shares at the Issue Price.

 

Termination of the Placing

 

Each Joint Bookrunner may, in its absolute discretion, by notice to the Company, terminate the Placing Agreement at any time up to Admission if, inter alia:

 

a.    there has, in the opinion of that Joint Bookrunner (acting in good faith), been a breach of the warranties given to it;

b.    there has, in the opinion of that Joint Bookrunner (acting in good faith), been a material adverse change;

c.     any statement contained in this Announcement or any other document or announcement issued or published by or on behalf of the Company in connection with the Placing is or has become or has been discovered to be untrue or inaccurate in any respect or misleading in any respect; or

d.    in the opinion of that Joint Bookrunner (acting in good faith), there has been a force majeure event.

 

If one Joint Bookrunner (the "Withdrawing Joint Bookrunner") but not both Joint Bookrunners serves notice to terminate the Placing Agreement, the other Joint Bookrunner (the "Continuing Joint Bookrunner") may, in its absolute discretion and without obligation, within 24 hours thereafter, elect, by giving notice to the Company, to allow the Placing to proceed on the basis that the Continuing Joint Bookrunner shall assume any and all obligations of the Withdrawing Joint Bookrunner save (i) where the Withdrawing Joint Bookrunner is the Company's nominated adviser, as nominated adviser to the Company and (ii) as regards any breach of the terms of the Placing Agreement by the Withdrawing Joint Bookrunner prior to the date of such termination, which remain to be performed under the Placing Agreement.  If the Continuing Joint Bookrunner fails to make that election to the Company within such 24 hour period then the Placing Agreement will terminate.

 

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

 

By participating in the Bookbuilding Process, each Placee agrees with the Company and the Joint Bookrunners that the exercise by the Company or either of the Joint Bookrunners of any right of termination or any other right or other discretion under the Placing Agreement shall be within the absolute discretion of the Company or the relevant Joint Bookrunner or for agreement between the Company and the relevant Joint Bookrunner (as the case may be) and that neither the Company nor the relevant Joint Bookrunner need make any reference to such Placee and that none of the Company, the Joint Bookrunners nor any of their respective Representatives shall have any liability to such Placee (or to any other person whether acting on behalf of a Placee or otherwise) whatsoever in connection with any such exercise.  Each Placee further agrees that they will have no rights against the Joint Bookrunners, the Company or any of their respective directors or employees under the Placing Agreement pursuant to the Contracts (Rights of Third Parties) Act 1999 (as amended).

 

By participating in the Placing, each Placee agrees that its rights and obligations terminate only in the circumstances described above and under the "Conditions of the Placing" section above and will not be capable of rescission or termination by it after the issue by a Joint Bookrunner of a trade confirmation email confirming that Placee's allocation and commitment in the Placing.

 

Application for admission to trading

 

Application will be made to the London Stock Exchange for admission of the Placing Shares to trading on AIM.

It is expected that Admission will take place on or before 8.00 a.m. on 31 May 2024 and that dealings in the Placing Shares on AIM will commence at the same time. 

 

Principal terms of the Placing

 

1.    The Joint Bookrunners are acting as joint bookrunners to the Placing, as agents for and on behalf of the Company.

 

2.    Participation in the Placing will only be available to persons who may lawfully be, and are, invited by either of the Joint Bookrunners to participate.  Each of the Joint Bookrunners and any of their respective affiliates are entitled to participate in the Placing as principal.

 

3.    The price per Placing Share (the "Issue Price") is fixed at 28 pence and is payable to the relevant Joint Bookrunner (as agent for the Company) by each Placee. 

 

4.    The Joint Bookrunners will, following consultation with the Company, determine in their absolute discretion the extent of each Placee's participation in the Placing, and this will be confirmed orally or in writing (including by email) by the relevant Joint Bookrunner as agent of the Company.  Such confirmation will constitute a legally binding commitment on the relevant Placee to acquire the relevant Placing Shares.

 

5.    Each Placee's allocation and commitment will be evidenced by a trade confirmation email issued to such Placee by the relevant Joint Bookrunner.  The terms of this Appendix will be deemed incorporated in that contract note.

 

6.    Each Placee's allocation and commitment to acquire Placing Shares will be made on the terms and subject to the conditions in this Appendix and will be legally binding on the Placee on behalf of which it is made and, except with the Joint Bookrunners' consent, will not be capable of variation or revocation after the time at which it is submitted.  Each Placee will have an immediate, separate, irrevocable and binding obligation, owed to the relevant Joint Bookrunner (as agent for the Company), to pay to it (or as it may direct) in cleared funds an amount equal to the product of the Issue Price and the number of Placing Shares such Placee has agreed to acquire and the Company has agreed to allot and issue to that Placee.

 

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

 

8.    Irrespective of the time at which a Placee's allocation(s) pursuant to the Placing is/are confirmed, settlement for all Placing Shares to be acquired pursuant to the Placing will be required to be made at the same time, on the basis explained below under "Registration and Settlement".

 

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

 

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

 

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

 

a.    the Joint Bookrunners;

 

b.    any of the Joint Bookrunners' respective affiliates, agents, directors, officers, consultants, partners (persönlich haftende Gesellschafter) or employees; nor

 

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

 

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

 

Representations, warranties and further terms

 

By submitting a bid in the Bookbuilding Process, each Placee (and any person acting on such Placee's behalf) irrevocably confirms, represents, warrants, acknowledges and agrees (for itself and for any such prospective Placee) with the Company and the Joint Bookrunners (in their capacity as bookrunners and placing agents of the Company in respect of the Placing) that (save where the relevant Joint Bookrunner expressly agrees in writing to the contrary):

 

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

 

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

 

a.    is required under the UK Prospectus Regulation or other applicable law; and

 

b.    has been or will be prepared in connection with the Placing;

 

3.    the Ordinary Shares are admitted to trading on AIM, and that the Company is therefore required to publish certain business and financial information in accordance with the AIM Rules for the Companies (the "AIM Rules") and UK MAR, which includes a description of the nature of the Company's business and the Company's most recent balance sheet and profit and loss account and that it is able to obtain or access such information without undue difficulty, and is able to obtain access to such information or comparable information concerning any other publicly traded company, without undue difficulty;

 

4.    it has made its own assessment of the Placing Shares and has relied on its own investigation of the business, financial or other position of the Company in accepting a participation in the Placing and neither the Joint Bookrunners nor the Company nor any of their respective Representatives nor any person acting on behalf of any of them has provided, and will not provide, it with any material regarding the Placing Shares or the Company or any other person other than the information in this Announcement or any information publicly announced through a Regulatory Information Service (as defined in the AIM Rules) by or on behalf of the Company on or prior to the date of this Announcement (the "Publicly Available Information"); nor has it requested either Joint Bookrunner, the Company, any of their respective Representatives or any person acting on behalf of any of them to provide it with any such information;

 

5.    neither Joint Bookrunner nor any person acting on behalf of it nor any of their respective Representatives has or shall have any liability for any Publicly Available Information, or any representation relating to the Company, provided that nothing in this paragraph excludes the liability of any person for fraudulent misrepresentation made by that person;

 

6.   

 

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

 

b.    neither the Joint Bookrunners, nor the Company (nor any of their respective Representatives) have made any representation or warranty to it, express or implied, with respect to the Company, the Placing or the Placing Shares or the accuracy, completeness or adequacy of the Publicly Available Information, nor will it provide any material or information regarding the Company, the Placing or the Placing Shares;

 

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

 

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

 

7.    the content of this Announcement and the Publicly Available Information has been prepared by and is exclusively the responsibility of the Company and that neither the Joint Bookrunners nor any persons acting on their behalf is responsible for or has or shall have any liability for any information, representation, warranty or statement relating to the Company contained in this Announcement or the Publicly Available Information nor will they be liable for any Placee's decision to participate in the Placing based on any information, representation, warranty or statement contained in this Announcement, the Publicly Available Information or otherwise.  Nothing in this Appendix shall exclude any liability of any person for fraudulent misrepresentation;

 

8.    neither it nor the beneficial owner of the Placing Shares is, nor will, at the time the Placing Shares are acquired, be a resident of the United States, Australia, Canada, the Republic of South Africa or Japan;

 

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

 

10.  it may be asked to disclose in writing or orally to the Joint Bookrunners: (i) if he or she is an individual, his or her nationality; or (ii) if he or she is a discretionary fund manager, the jurisdiction in which the funds are managed or owned;

 

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

 

 

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

 

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

 

b.    has fully observed such laws and regulations;

 

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

 

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

 

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

 

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

 

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

 

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

 

17.  it understands that:

 

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

 

b.    no representation is made as to the availability of the exemption provided by Rule 144 of the Securities Act for resales or transfers of Placing Shares; and

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

24.  none of the Joint Bookrunners, the Company nor any of their respective Representatives nor any person acting on behalf of any of them is making any recommendations to it or advising it regarding the suitability of any transactions it may enter into in connection with the Placing and that participation in the Placing is on the basis that it is not and will not be a client of either Joint Bookrunner and that neither Joint Bookrunner has any duties or responsibilities to it for providing the protections afforded to its clients or for providing advice in relation to the Placing nor in respect of any representations, warranties, undertakings or indemnities contained in the Placing Agreement nor for the exercise or performance of any of its rights and obligations thereunder including any rights to waive or vary any Conditions or exercise any termination right;

 

25.  it will make payment to the relevant Joint Bookrunner for the Placing Shares allocated to it in accordance with the terms and conditions of this Announcement on the due times and dates set out in this Announcement, failing which the relevant Placing Shares may be placed with others on such terms as the relevant Joint Bookrunner determines in its absolute discretion without liability to the Placee and it will remain liable for any shortfall below the net proceeds of such sale and the proceeds of such Placing Shares and may be required to bear any stamp duty or stamp duty reserve tax (together with any interest or penalties due pursuant to the terms set out or referred to in this Announcement) which may arise upon the sale of such Placee's Placing Shares on its behalf;

 

26.  its allocation (if any) of Placing Shares will represent a maximum number of Placing Shares which it will be entitled, and required, to subscribe for, and that the Company may call upon it to subscribe for a lower number of Placing Shares (if any), but in no event in aggregate more than the aforementioned maximum;

 

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

 

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

 

a.    the Placee; or

 

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

 

and that the Joint Bookrunners and the Company will not be responsible for any liability to stamp duty or stamp duty reserve tax resulting from a failure to observe this requirement.  Each Placee and any person acting on behalf of such Placee agrees to acquire Placing Shares pursuant to the Placing and agrees to indemnify the Company and the Joint Bookrunners in respect of the same on the basis that the Placing Shares will be allotted or transferred (as applicable) to a CREST stock account of the relevant Joint Bookrunner who will hold them as nominee on behalf of the Placee until settlement in accordance with its standing settlement instructions with it;

 

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

 

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

 

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

 

32.  if it is within the United Kingdom, it is a Qualified Investor as defined in Article 2(e) of the UK Prospectus Regulation and, if it is within a Relevant State, it is a Qualified Investor as defined in Article 2(e) of the EU Prospectus Regulation;

 

33.  it has only communicated or caused to be communicated and it will only communicate or cause to be communicated any invitation or inducement to engage in investment activity (within the meaning of section 21 of the FSMA) relating to Placing Shares in circumstances in which section 21(1) of the FSMA does not require approval of the communication by an authorised person and it acknowledges and agrees that this Announcement has not been approved by either Joint Bookrunner in its capacity as an authorised person under section 21 of the FSMA and it may not therefore be subject to the controls which would apply if it was made or approved as financial promotion by an authorised person;

 

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

 

35.  if it is a financial intermediary, as that term is used in Article 5(1) of the UK Prospectus Regulation, the Placing Shares acquired by it will not be acquired on a non-discretionary basis on behalf of, nor will they be acquired with a view to their offer or resale to, persons in the United Kingdom other than Qualified Investors, or in circumstances in which the express prior written consent of the Joint Bookrunners has been given to each proposed offer or resale;

 

36.  if in the United Kingdom, unless otherwise agreed by the Joint Bookrunners, it is a "professional client" or an "eligible counterparty" within the meaning of Chapter 3 of the FCA Handbook Conduct of Business Sourcebook ("COBS") and it is acquiring Placing Shares for investment only and not with a view to resale or distribution;

 

37.  if it has received any inside information (for the purposes of the UK MAR and section 56 of the Criminal Justice Act 1993 or other applicable law) about the Company in advance of the Placing, it warrants that it has received such information within the market soundings regime provided for in Article 11 of UK MAR and has not:

 

a.    dealt (or attempted to deal) in the securities of the Company or cancelled or amended a dealing in the securities of the Company;

 

b.    encouraged, recommended or induced another person to deal in the securities of the Company or to cancel or amend an order concerning the Company's securities; or

 

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

 

38.  neither Joint Bookrunner, nor the Company nor any of their respective Representatives nor any person acting on behalf of the Company, either Joint Bookrunner or its Representatives is making any recommendations to it, advising it regarding the suitability of any transactions it may enter into in connection with the Placing nor providing advice in relation to the Placing nor in respect of any warranties, acknowledgements, agreements, undertakings, or indemnities contained in the Placing Agreement nor the exercise or performance of any of the Joint Bookrunners' rights and obligations thereunder including any rights to waive or vary any Conditions or exercise any termination right;

 

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

 

40.  it:

a.    has complied with its obligations in connection with money laundering and terrorist financing under the Proceeds of Crime Act 2002 (as amended), the Terrorism Act 2000 (as amended), the Terrorism Act 2006, the Money Laundering, Terrorist Financing and Transfer of Funds (Information on the Payer) Regulations 2017 (as amended) and all related or similar rules, regulations or guidelines, issued, administered or enforced by any government agency having jurisdiction in respect thereof and the Money Laundering Sourcebook of the FCA (together, the "Money Laundering Regulations");

 

b.    is not a person:

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

 

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

 

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

 

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

 

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

 

42.  its participation in the Placing would not give rise to an offer being required to be made by it, or any person with whom it is acting in concert, pursuant to Rule 9 of the City Code on Takeovers and Mergers;

 

43.  any money held in an account with either Joint Bookrunner on behalf of the Placee and/or any person acting on behalf of the Placee will not be treated as client money within the meaning of the relevant rules and regulations of the FCA made under the FSMA.  The Placee acknowledges that the money will not be subject to the protections conferred by the client money rules; as a consequence, this money will not be segregated from the relevant Joint Bookrunner's money in accordance with the client money rules and will be used by the relevant Joint Bookrunner's in the course of its business; and the Placee will rank only as a general creditor of the relevant Joint Bookrunner's;

 

44.  either Joint Bookrunner may choose to invoke the CASS Delivery Versus Payment exemption (under CASS 7.11.14R within the FCA Handbook Client Assets Sourcebook) with regard to settlement of funds, in connection with the Placing, should it see fit;

 

45.  neither it nor, as the case may be, its clients expect the Joint Bookrunners to have any duties or responsibilities to such persons similar or comparable to the duties of "best execution" and "suitability" imposed by the COBS, and that the Joint Bookrunners are not acting for it or its clients, and that the Joint Bookrunners will not be responsible for providing the protections afforded to clients of the Joint Bookrunners or for providing advice in respect of the transactions described in this Announcement;

 

46.  it acknowledges that its commitment to acquire Placing Shares on the terms set out in this Announcement and in the trade confirmation will continue notwithstanding any amendment that may in future be made to the terms and conditions of the Placing and that Placees will have no right to be consulted or require that their consent be obtained with respect to the Company's or the Joint Bookrunners' conduct of the Placing;

 

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

 

48.  it irrevocably appoints any duly authorised officer of each Joint Bookrunner as its agent for the purpose of executing and delivering to the Company and/or its registrars any documents on its behalf necessary to enable it to be registered as the holder of any of the Placing Shares for which it agrees to acquire upon the terms of this Announcement;

 

49.  the Company, the Joint Bookrunners and others (including each of their respective Representatives) will rely upon the truth and accuracy of the foregoing representations, warranties, acknowledgements, undertakings and agreements, which are given to each Joint Bookrunner on its own behalf and on behalf of the Company and are irrevocable;

 

50.  it is acting as principal only in respect of the Placing or, if it is acquiring the Placing Shares as a fiduciary or agent for one or more investor accounts, it:

 

a.    is duly authorised to do so and it has full power and authority to make, and does make, the foregoing representations, warranties, acknowledgements, agreements and undertakings on behalf of each such accounts; and

 

b.    will remain liable to the Company and the Joint Bookrunners for the performance of all its obligations as a Placee in respect of the Placing (regardless of the fact that it is acting for another person);

 

51.  subject to acquiring any Placing Shares, it will be bound by the terms of the articles of association of the Company;

 

52.  time is of the essence as regards its obligations under this Appendix;

 

53.  any document that is to be sent to it in connection with the Placing will be sent at its risk and may be sent to it at any address provided by it to either of the Joint Bookrunners;

 

54.  the Placing Shares will be issued subject to the terms and conditions of this Appendix; and

 

55.  the terms and conditions contained in this Appendix and all documents into which this Appendix is incorporated by reference or otherwise validly forms a part and/or any agreements entered into pursuant to these terms and conditions and all agreements to acquire Placing Shares pursuant to the Bookbuilding Process and/or the Placing and all non-contractual or other obligations arising out of or in connection with them, will be governed by and construed in accordance with English law and it submits to the exclusive jurisdiction of the English courts in relation to any claim, dispute or matter arising out of such contract (including any dispute regarding the existence, validity or termination of such contract or relating to any non-contractual or other obligation arising out of or in connection with such contract), except that enforcement proceedings in respect of the obligation to make payment for the Placing Shares (together with interest chargeable thereon) may be taken by the Company or either of the Joint Bookrunners in any jurisdiction in which the relevant Placee is incorporated or in which any of its securities have a quotation on a recognised stock exchange.

 

By participating in the Placing, each Placee (and any person acting on such Placee's behalf) agrees to indemnify and hold the Company, the Joint Bookrunners and each of their respective Representatives harmless from any and all costs, claims, liabilities and expenses (including legal fees and expenses) arising out of or in connection with any breach of the representations, warranties, acknowledgements, agreements and undertakings given by the Placee (and any person acting on such Placee's behalf) in this Appendix or incurred by the Joint Bookrunners, the Company or each of their respective Representatives arising from the performance of the Placee's obligations as set out in this Announcement, and further agrees that the provisions of this Appendix shall survive after the completion of the Placing.

 

The rights and remedies of the Joint Bookrunners and the Company under these terms and conditions are in addition to any rights and remedies which would otherwise be available to each of them and the exercise or partial exercise of one will not prevent the exercise of others.

 

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

 

The representations, warranties, acknowledgements, agreements and undertakings contained in this Appendix are given to each Joint Bookrunner for itself and on behalf of the Company and are irrevocable.

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

 

Berenberg, which is authorised and regulated by the German Federal Financial Supervisory Authority and in the United Kingdom is deemed authorised under the Temporary Permissions Regime and subject to limited regulation by the FCA, is acting exclusively for the Company in connection with the Placing and will not be acting for any other person (including any Placees) and will not be responsible to any person other than the Company for providing the protections afforded to clients of Berenberg or for advising any other person in respect of the matters referred to in this Announcement.  No representation or warranty, express or implied, is made by Berenberg as to the contents of this Announcement.

 

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

 

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

 

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

 

References to time in this Announcement are to London time, unless otherwise stated.

 

All times and dates in this Announcement may be subject to amendment.  Placees will be notified of any changes.

 

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

 

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

 

The New Ordinary Shares to be issued pursuant to the Capital Raising will not be admitted to trading on any stock exchange other than the AIM market of the London Stock Exchange.

 

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.