Alteration Earth
PLC
(the "Company" or
"ALTE")
Posting of Circular and
General Meeting Notice
The Company is today issuing a
shareholder circular ("Circular") convening, and explaining the
reasons for, a general meeting of the Company ("General Meeting")
to consider and, if thought fit, approve the following proposed
measures:
-
Acquisition by the Company of the issued share capital and warrants
of Pri0r1ty AI plc (to be re-registered as Pri0r1ty AI Limited)
(the "Target")
- Directors'
powers to allot ordinary shares
-
Appointment of new directors to the board of the Company
-
Disapplication of pre-emption rights
- Change of
name to Pri0r1ty Intelligence Group PLC
- Adoption
of new articles of association
The above matters are expected to
take effect on or shortly before completion of the Acquisition of
the Target (as detailed under the heading Introduction below). Completion of the
Acquisition remains conditional on a number of matters as outlined
in the Circular including completion of the Fundraise (as detailed
under the heading Fundraise below).
The Circular also contains notice of
the General Meeting convened for 13 December 2024 at which the
above measures are to be considered.
The explanatory letter from Matthew
Beardmore, Director of ALTE, which forms part of the Circular, sets
out the Directors' reasoning for the Acquisition (as defined in the
Circular). The Circular is a detailed document, and shareholders
are urged to read it carefully in full. Extracts from the Circular
are provided below.
Introduction
I am writing to inform you that the
board of directors ("Board" or "Directors") is seeking Shareholder
approval for the proposed acquisition by the Company of the entire
issued and to be issued share capital and warrants of Pri0r1ty AI
plc (to be re-registered as Pri0r1ty AI Limited) (the "Target"),
which comprises a reverse takeover ("RTO") for the purposes of the
UK Listing Rules, substantially on the terms and subject to the
conditions set out in the Share Purchase Agreement (as defined in
the Circular) (the "Acquisition"), and certain ancillary matters
relating to the Acquisition (together, the "Proposals").
The purpose of the Circular is to
explain the background to and the reasons for the Acquisition. The
Circular also sets out the Proposals and why the Directors consider
the Acquisition to be in the best interests of the Company and
Shareholders as a whole and why the Directors recommend that you
vote in favour of the resolutions to approve the Proposals
("Resolutions"). The approval of the Resolutions by Shareholders is
required to enable the Acquisition to be completed.
Background to and reasons for the Proposals
As announced by the Company on 27
June 2024, the Company entered non-binding heads of terms to
acquire the entire issued and to be issued share capital and
warrants of the Target in consideration for an issue of new shares
in the Company. Whilst the necessary work required to complete the
Acquisition is well progressed, the Acquisition remains subject to
legal, financial and other due diligence, including completion of
the Fundraise (as defined in the Circular), and the signing of the
Share Purchase Agreement.
The Target is an artificial
intelligence (AI) driven, data powered software as a service (SaaS)
solution that aims to help businesses at various stages of their
journey by creating efficiency through technology. Its objective is
to assist SMEs by providing a combination of services derived from
deep learning, data architecture and AI models. The Target has
built a digital agent for automated business processes, whose
underlying technology is Pri0r1ty Advisor, a bespoke AI-powered
advisory bot that uses Deep Learning and can engage investors,
customers or stakeholders either on a website, Instant Messenger
(IM) or email server.
The Board believes the Target is
well positioned to take advantage of the burgeoning AI sector,
specifically targeting SMEs with growth services leveraging AI
technology. The addressable market is substantial, considering the
vast number of SMEs in the UK and globally. In the UK alone, there
are over 5.6 million SMEs, with 743,000 new businesses created in
2022. This number is indicative of a vibrant entrepreneurial
ecosystem and represents a significant opportunity. The potential
for business growth within this market is further underscored by
the broader economic impact of AI. PwC estimates that AI could
contribute US$15.7 trillion to the global economy by 2030,
highlighting the transformative potential of AI technologies across
various sectors.
It is the Board's view that the
Target's focus on providing AI-driven growth services to SMEs
positions it well within this expansive market. The Target's
offerings are designed to be scalable, future-proof, and inclusive,
making advanced AI tools accessible to businesses regardless of
their size, sector, or growth stage. This approach not only
democratizes access to AI but also addresses a critical need for
cost-effective growth solutions among SMEs. By offering a suite of
AI-powered services and potentially removing the need for expensive
advisers or new hires, the Target intends to tap into the demand
for efficient, technology-driven business growth solutions. The
growing number of businesses and the increasing recognition of AI's
economic potential suggest a vast addressable market and
substantial growth opportunities for the Target.
Fundraise
As part of the RTO, it is proposed
that the Company will seek the voluntary cancellation of the
admission of its shares to the Official List and to trading on the
London Stock Exchange's main market for listed securities and will
instead seek admission of its enlarged share capital to trading on
AIM ("Admission"). Alongside the RTO and Admission, the Company
intends to undertake an equity fundraise to raise gross proceeds of
between £1-2 million (the "Fundraise"). To raise such proceeds, the
Company intends to issue new ordinary shares at a price per share
to be determined in a marketing roadshow.
The proceeds of the Fundraise are
principally expected to be used to:
- launch a
comprehensive marketing programme to attract new
customers;
- grow sales
and client delivery teams;
- provide
general working capital for the enlarged group; and
-
meet the transactional costs and expenses.
Proposed Name Change
As part of the special business of
the General Meeting, a special resolution will be proposed to
change the name of the Company to "Pri0r1ty Intelligence Group PLC"
("Proposed Name Change"). The reason for the Proposed Name Change
is simply to reflect the Target business and its associated brand.
Use of the word "Group" demonstrates that the Company will become
the parent of a group of companies.
The notice of General Meeting sets
out details of, and seeks approval for, the Proposed Name Change as
well as the other ordinary and special business of the General
Meeting.
New Articles
The existing articles of association
of the Company are suitable for a company whose securities are
admitted to the Official List and to trading on the Main Market.
When they were adopted by the Company, it was envisaged that the
Company would complete a reverse takeover and seek to maintain the
admission of its shares on the Official List and seek the
readmission of its enlarged issued share capital to trading on the
Main Market.
Given the Company's intention to
seek the admission of its enlarged issued share capital to trading
on AIM, the Board proposes that the Company adopt new articles of
association with effect from Admission (the "New Articles"). The
New Articles contain provisions which are more suited for a company
whose securities are admitted to trading on AIM.
A copy of the New Articles will be
posted to shareholders together with the Circular.
General Meeting
Set out at the end of the Circular
is a notice convening the General Meeting to be held at 10:00 a.m.
on 13 December 2024 at the offices of Keystone Law at 48 Chancery
Lane, London WC2A 1JF.
Resolutions 1 to 7 are being
proposed as ordinary resolutions and require approval by a majority
of the votes cast (by persons present in person or by proxy) at the
General Meeting for the Resolutions to be passed. Resolutions 8 to
11 are being proposed as special resolutions and require approval
by not less than three-quarters of the votes cast (by persons
present in person or by proxy) at the General Meeting for the
Resolutions to be passed. The Resolutions are inter-conditional on
each other, meaning they all need to be passed for them to become
effective. The RTO will not proceed unless all the Resolutions are
passed.
The Resolutions being proposed at
the General Meeting are as follows:
Resolution 1 - An ordinary
resolution to authorise the Company to complete the Acquisition,
substantially on the terms of and subject to the conditions set out
in the Share Purchase Agreement (as amended or modified from time
to time).
Resolution 2 - An ordinary
resolution to authorise Directors to exercise all powers of the
Company to allot the Consideration Shares and the Fundraise Shares
and grant warrants over shares in respect of the Consideration
Warrants, the Broker Warrants, the Nomad Warrants and certain other
warrants (as more fully particularised in the
Resolution).
Resolution 3 - An ordinary
resolution to authorise the Directors to allot shares in the
Company and grant rights to subscribe for or to convert any
security into shares of the Company, otherwise than pursuant to
Resolution 2, up to an aggregate nominal amount equal to 50 per
cent. of the enlarged issued share capital of the Company as at
Admission.
Resolution 4 - An ordinary
resolution to appoint James Sheehan as a Director of the Company
with effect from Admission.
Resolution 5 - An ordinary
resolution to appoint Daniel Maling as a Director of the Company
with effect from Admission.
Resolution 6 - An ordinary
resolution to appoint Philip Adler as a Director of the Company
with effect from Admission.
Resolution 7 - An ordinary
resolution to appoint Karen Lewis-Hollis as a Director of the
Company with effect from Admission.
Resolution 8 - A special resolution
to approve the disapplication of pre-emption rights in relation to
the shares in the capital of the Company proposed to be allotted
pursuant to the authority given in Resolution 2.
Resolution 9 - A special resolution
to approve the disapplication of pre-emption rights in relation to
the shares in the capital of the Company that may be allotted
pursuant to the authority given in Resolution 3.
Resolution 10 - A special resolution
to approve, conditional on Admission, the change of the Company's
name to "Pri0r1ty Intelligence Group PLC".
Resolution 11 - A special resolution
to adopt, conditional on Admission, the revised articles of
association produced to the Meeting be approved and adopted as the
articles of association of the Company in substitution for, and to
the exclusion of, the existing articles of association of the
Company.
A copy of the Circular, which
includes the General Meeting notice, is available on the Company's
website in the "Publications" section (see "Circulars and Notices"
tab) of the Investors section and is accessible by visiting:
https://www.altearthplc.com/publications/
For further information, please
visit www.altearthplc.com or contact:
Alteration Earth PLC
Matthew Beardmore
Director
Tel: +44 (0)20 4501
8549
Email:
info@altearthplc.com
PR
Advisers to Pri0r1ty
Camarco - Marc Cohen, Emily
Hall
Pri0r1ty@camarco.co.uk
Tel: +44 (0)7741 052 506
Tel: +44 (0)7817 304 939