TIDMESC
RNS Number : 2633R
Escape Hunt PLC
03 November 2021
THIS ANNOUNCEMENT, INCLUDING THE APPIX, 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, CANADA, JAPAN, NEW
ZEALAND, THE REPUBLIC OF SOUTH AFRICA OR ANY OTHER JURISDICTION IN
WHICH SUCH RELEASE, PUBLICATION OR DISTRIBUTION WOULD BE UNLAWFUL.
PLEASE SEE THE IMPORTANT NOTICES WITHIN THIS ANNOUNCEMENT.
FURTHER, THIS ANNOUNCEMENT IS MADE FOR INFORMATION PURPOSES ONLY
AND DOES NOT CONSTITUTE AN OFFER TO SELL OR ISSUE OR SOLICITATION
TO BUY, SUBSCRIBE FOR OR OTHERWISE ACQUIRE SHARES IN ESCAPE HUNT
PLC IN ANY JURISDICTION IN WHICH ANY SUCH OFFER OR SOLICITATION
WOULD BE UNLAWFUL.
THE INFORMATION CONTAINED WITHIN THIS ANNOUNCEMENT IS DEEMED BY
THE COMPANY TO CONSTITUTE INSIDE INFORMATION AS STIPULATED UNDER
THE MARKET ABUSE REGULATION ("MAR"). UPON THE PUBLICATION OF THE
ANNOUNCEMENT VIA A REGULATORY INFORMATION SERVICE, THIS INFORMATION
IS CONSIDERED TO BE IN THE PUBLIC DOMAIN AND SUCH PERSONS SHALL
THEREFORE CEASE TO BE IN POSSESSION OF INSIDE INFORMATION.
3 November 2021
Escape Hunt Plc
("Escape Hunt", the "Company" or the "Group")
Proposed acquisition of Boom Battle Bars,
Proposed Placing, Subscription and Open Offer,
each at 30 pence per share,
and
Change of Name to XP Factory Plc
Escape Hunt (AIM:ESC), a leading operator of escape rooms in the
fast-growing experiential leisure sector, is pleased to announce:
-
-- the proposed acquisition of Boom Battle Bars for a total
consideration of GBP17.38 million to be satisfied by the initial
payment of GBP9.88 million in cash and deferred consideration
through the issue of up to 25,000,000 Consideration Shares payable
subject to an earn-out;
-- a placing of new ordinary shares to raise GBP14.775 million
for the Company at 30 pence per share (the "Issue Price") of which
GBP9.88 million will be used to satisfy the cash element of the
consideration payable for the proposed acquisition of Boom Battle
Bars;
-- a subscription of new ordinary shares to raise approximately
GBP0.225 million for the Company at the Issue Price; and
-- an open offer to raise up to a further approximately GBP2.2
million for the Company on the basis of 1 Open Offer Share for
every 12 Ordinary Shares held on the Record Date at the Issue
Price.
Key Highlights
-- Boom Battle Bars is a fast growing experiential leisure
business combining competitive socialising activities with
cocktails and street food and currently comprises 1 owner-operated
venue and 5 franchised venues in the UK.
-- Significant advanced pipeline of 21 sites, where 10 have
already been signed, including 2 in build, and a further 11 sites
which are expected to exchange within 30 - 90 days.
-- Total pipeline of 39 sites includes a further 18 sites with outline terms agreed.
-- The total pipeline includes GBP12.6 million of landlord
contributions towards build, of which GBP7.6 million relates to the
advanced pipeline.
-- Within the advanced pipeline, proposed owner-operated sites
include prime sites in London on Oxford Street and the O2
Arena.
-- 18 franchisees have already signed agreements to take on franchise sites.
-- Potential for co-location of Escape Hunt in several sites,
with first co-located site at the Lakeside shopping centre in
Thurrock already open
-- The Acquisition is expected to be significantly earnings
accretive and profitable in the first half of 2022.
-- The total aggregate consideration payable for the Acquisition
is GBP17.38 million, to be satisfied by the initial payment of
GBP9.88 million in cash and deferred consideration through the
issue of up to 25,000,000 Consideration Shares.
-- The Consideration Shares are subject to an earn-out and will
only be issued if the performance of the Boom Battle Bars Group in
the financial year ending 31 December 2022 meets a combination of
turnover and site roll-out targets. The number of Consideration
Shares to be issued is subject to a sliding scale based on the
extent to which the targets are met.
-- The Company is seeking to raise GBP14.775 million net of
expenses (including VAT) pursuant to the Placing through the issue
of the Placing Shares at the Issue Price.
-- The Company is also raising approximately GBP0.225 million
net of expenses (including VAT) pursuant to the Subscription
through the issue of the Subscription Shares at the Issue
Price.
-- The Company is making an Open Offer to Qualifying
Shareholders to raise up to an additional GBP2.2 million (before
expenses) at the Issue Price.
-- Each Director, or an associate of each Director, has
conditionally agreed to participate in the Fundraising. In
aggregate, Directors' subscriptions total GBP485,000 (excluding the
Open Offer).
-- The Issue Price of 30 pence per New Ordinary Share represents
a discount of approximately 13 per cent. to the 10 day average
closing middle market price per Ordinary Share to 2 November 2021,
being the last business day prior to the date of this
announcement.
-- The Company has been granted a two year exclusivity period by
MFT Capital to acquire Flip Out, a family focused leisure
entertainment business and the UK's largest trampoline operator, on
pre-agreed terms.
-- The Directors believe that the Acquisition presents an
unprecedented opportunity to benefit from the trends in
experiential leisure and take advantage of the conditions in the
retail commercial property market to create in the Enlarged Group a
business which has the potential to become one of the UK's
pre-eminent experiential leisure businesses.
-- Furthermore, the Directors believe that the opportunity for
growth, cash generation and profitability is greater for the
combined businesses than for the individual constituents and that
there is the potential to generate operational synergies.
-- Proposed change of the Company's name to XP Factory Plc to
reflect the changing nature of the Enlarged Group's business.
-- Completion of the Fundraising is subject, inter alia, to
shareholder approval to enable the issue of the New Ordinary
Shares, which will be sought at a General Meeting of the Company
expected to be held at 10.00 a.m. on 22 November 2021.
-- Shore Capital Stockbrokers Limited is acting as broker in
relation to the Placing and Shore Capital and Corporate Limited is
acting as nominated adviser to the Company. KK Advisory Ltd is
acting as placing agent.
Further information on the background to and reasons for the
Acquisition and Fundraising is set out below. The Bookbuild must
close and the Resolutions numbered 1 and 2 must be passed at the
General Meeting in order for the Acquisition and the Fundraising to
proceed.
If the Bookbuild does not close and/or Shareholders do not
approve the Resolutions numbered 1 and 2, the Acquisition and the
Fundraising cannot be implemented.
If the Acquisition does not proceed or cannot be implemented,
the Company would be impeded in pursuing the strategy outlined for
maximising stakeholder value.
Details of the Fundraising
Placing
The Placing will be conducted by way of an accelerated bookbuild
process (the "Bookbuild") which will be launched immediately
following the release of this announcement (the "Announcement"), in
accordance with the terms and conditions set out in the Appendix to
this Announcement (the "Appendix").
Escape Hunt has entered into a Placing and Open Offer Agreement
with Shore Capital. Pursuant to the Placing and Open Offer
Agreement, Shore Capital has agreed, in accordance with its terms,
to use its respective reasonable endeavours to place the Placing
Shares with certain new and existing institutional and other
investors.
The final number of Placing Shares will be agreed by Escape Hunt
and Shore Capital following the close of the Bookbuild, and the
result of the Placing will be announced as soon as practicable
thereafter. The timing for the close of the Bookbuild and
allocation of the Placing Shares shall be at the discretion of
Shore Capital in consultation with the Company. The Placing is not
being underwritten.
By choosing to participate in the Placing and by making a verbal
offer to acquire Placing Shares, investors will be deemed to have
read and understood this announcement (including the Appendix) in
its entirety and to be making such offer on the terms and subject
to the conditions in this announcement, and to be providing the
representations, warranties and acknowledgements contained in the
Appendix.
Your attention is drawn to the detailed terms and conditions of
the Placing set out in the Appendix to this announcement.
Unless otherwise indicated, capitalised terms in this
Announcement have the meaning given to them in the Definitions
section below.
Subscription
The Subscription comprises the issue of the Subscription Shares
by the Company at the Issue Price. It is anticipated that the
Subscription will raise approximately GBP0.225 million for the
Company, before expenses.
The Subscription Shares will be issued credited as fully paid
and will, on issue, rank pari passu with the Existing Ordinary
Shares, the Placing Shares and the Open Offer Shares in all
respects including, without limitation, in relation to any
dividends and other distributions declared, paid or made following
Admission.
Open Offer
In addition, in order to provide Shareholders who do not take
part in the Placing with an opportunity to participate in the
proposed issue of New Ordinary Shares, the Company is providing all
Qualifying Shareholders with the opportunity to subscribe for Open
Offer Shares, to raise up to a further GBP 2.2 million (before
expenses), on the basis of 1 Open Offer Share for every 12 Ordinary
Shares held on the Record Date, at the Issue Price. Qualifying
Shareholders subscribing for their full entitlement under the Open
Offer may also request additional Open Offer Shares through the
Excess Application Facility. The Open Offer is not being
underwritten.
General
The issue of the New Ordinary Shares is conditional, inter alia,
on the passing of Resolutions numbered 1 and 2 at the General
Meeting, which is expected to be convened for 10.00 am on 22
November 2021. Application will be made to the London Stock
Exchange for the New Ordinary Shares to be admitted to trading on
AIM. Admission of the Placing Shares, the Subscription Shares and
the Open Offer Shares is expected to become effective and dealings
in such shares are expected to commence at 8.00 am on 23 November
2021.
The Placing Shares, the Subscription Shares and the Open Offer
Shares, when issued, will be fully paid and will rank pari passu in
all respects with the Existing Ordinary Shares.
The Appendix (which forms part of this Announcement) contains
the detailed terms and conditions of the Placing.
The Circular containing further details of the Acquisition,
Fundraising and convening the General Meeting and the accompanying
Proxy Form and Application Form for Qualifying Non-CREST
Shareholders is expected to be despatched to Shareholders on 4
November 2021 and will thereafter be available on the Company's
website at https://escapehunt.com/investors/ .
Richard Harpham, Chief Executive Officer of Escape Hunt,
said:
"We are incredibly excited to be acquiring Boom Battle Bars,
which is highly complementary to our existing Escape Hunt business.
The acquisition allows us to capitalise on the growth in
experiential leisure and competitive socialising, and significantly
improves our ability to access the best property locations in a
soft commercial property environment. There are material potential
benefits from co-location of sites in the same venues, which will
enhance our combined site economics, and the businesses enjoy a
strong overlap in target customer, offering attractive cross
marketing and brand awareness synergies. The advanced pipeline of
sites provides a secure runway for growth for both brands and the
Board believes the combination of the businesses will be able to
exploit the market opportunity more effectively than either
business on its own."
Enquiries:
Escape Hunt plc
https://www.escapehunt.com/
Richard Harpham (Chief Executive Officer)
Graham Bird (Chief Financial Officer) +44 (0) 20 7846 3322
Shore Capital, Nomad and Joint Broker
https://www.shorecap.co.uk/
Tom Griffiths (Corporate Advisory)
David Coaten (Corporate Advisory) +44 (0) 20 7408 4050
Zeus Capital Limited, Joint Broker
https://www.zeuscapital.co.uk/
Daniel Harris +44 (0) 20 3829 5000
KK Advisory Ltd, Placing Agent +44 (0) 20 7039 1901
www.kkadvisory.co.uk
Kam Bansil
IFC Advisory - Financial PR
https://www.investor-focus.co.uk/
Graham Herring
Florence Chandler +44 (0) 20 3934 6630
The person responsible for arranging the release of this
information is Richard Harpham, CEO of the Company.
IMPORTANT NOTICE
This Announcement, including the Appendix (together, the
"Announcement"), and the information contained herein is for
information purposes only and is not for release, publication or
distribution, directly or indirectly, in whole or in part, in or
into or from the United States, Australia, Canada, Japan, New
Zealand, the Republic of South Africa, or any other jurisdiction
where to do so might constitute a violation of the relevant laws or
regulations of such jurisdiction (the "Placing Restricted
Jurisdictions"). The New Ordinary Shares have not been and will not
be registered under the United States Securities Act of 1933 (the
"Securities Act") or under the securities laws of any state or
other jurisdiction of the United States and may not be ordered,
sold, or transferred, directly or indirectly, in or into the United
States absent registration under the Securities Act or an available
exemption from or in a transaction not subject to the registration
requirements of the Securities Act and, in each case, in compliance
with the securities law of any state or any other jurisdiction of
the United States. No public ordering of the New Ordinary Shares is
being made in the United States. Persons receiving this
Announcement (including custodians, nominees and trustees) must not
forward, distribute, mail or otherwise transmit it in or into the
United States or use the United States mails, directly or
indirectly, in connection with the Fundraising. This Announcement
does not constitute or form part of an order to sell or issue or a
solicitation of an order to buy, subscribe for or otherwise acquire
any securities in any jurisdiction including, without limitation,
the Placing Restricted Jurisdictions or any other jurisdiction in
which such order or solicitation would be unlawful. This
Announcement and the information contained in it is not for
publication or distribution, directly or indirectly, to persons in
a Placing Restricted Jurisdiction unless permitted pursuant to an
exemption under the relevant local law or regulation in any such
jurisdiction.
No action has been taken by the Company, Shore Capital and
Corporate or Shore Capital Stockbrokers or any of their respective
directors, officers, partners, agents, employees or affiliates that
would permit an order of the New Ordinary Shares or possession or
distribution of this Announcement or any other publicity material
relating to such New Ordinary Shares in any jurisdiction where
action for that purpose is required. Persons receiving this
Announcement are required to inform themselves about and to observe
any restrictions contained in this Announcement.
Persons (including, without limitation, nominees and trustees)
who have a contractual or other legal obligation to forward a copy
of this Announcement should seek appropriate advice before taking
any action.
This Announcement is not being distributed by, nor has it been
approved for the purposes of section 21 of FSMA by, a person
authorised under FSMA. This Announcement is being distributed and
communicated to persons in the United Kingdom only in circumstances
in which section 21(1) of FSMA does not apply.
The information contained in this Announcement is for background
purposes only and does not purport to be full or complete. No
reliance may be placed for any purpose on the information contained
in this Announcement or its accuracy, fairness or completeness.
Any indication in this Announcement of the price at which the
Company's shares have been bought or sold in the past cannot be
relied upon as a guide to future performance. Persons needing
advice should consult an independent financial adviser. No
statement in this Announcement is intended to be a profit forecast
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.
Shore Capital and Corporate, which is authorised and regulated
in the UK by the FCA, is acting as nominated adviser to the Company
in connection with the matters described in this Announcement and
is not acting for any other persons in relation to the Fundraising
or Admission. Shore Capital and Corporate is acting exclusively for
the Company and for no one else in relation to the contents of this
Announcement and persons receiving this Announcement should note
that Shore Capital and Corporate will not be responsible to anyone
other than the Company for providing the protections afforded to
clients of Shore Capital and Corporate or for advising any other
person on the arrangements described in this Announcement. The
responsibilities of Shore Capital and Corporate as the Company's
nominated adviser under the AIM Rules and the AIM Rules for
Nominated Advisers are owed solely to the London Stock Exchange and
are not owed to the Company or to any Director, Shareholder or
other person in respect of his decision to acquire shares in the
capital of the Company in reliance on any part of this Announcement
or otherwise.
Shore Capital Stockbrokers, which is authorised and regulated in
the United Kingdom by the FCA, is acting as sole broker to the
Company in connection with the matters described in this
Announcement and is not acting for any other persons in relation to
the Fundraising or Admission. Shore Capital Stockbrokers is acting
exclusively for the Company and for no one else in relation to the
contents of this Announcement and persons receiving this
Announcement should note that Shore Capital Stockbrokers will not
be responsible to anyone other than the Company for providing the
protections afforded to clients of Shore Capital Stockbrokers or
for advising any other person on the arrangements described in this
Announcement.
This Announcement has been issued by and is the sole
responsibility of the Company. No representation or warranty,
express or implied, is or will be made as to, or in relation to,
and no responsibility or liability is or will be accepted by or on
behalf of the Company (except to the extent imposed by law or
regulations), Shore Capital and Corporate or Shore Capital
Stockbrokers or by their affiliates or their respective agents,
directors, officers and employees as, or in relation, to the
contents of this Announcement, including its accuracy, completeness
or verification or for any other statement made or purported to be
made by any of them, or on their behalf, the Company or any other
person in connection with the Company, the Fundraising or Admission
or for any other written or oral information made available to or
publicly available to any interested party or its advisers, and any
liability therefore is expressly disclaimed. Shore Capital and
Corporate and Shore Capital Stockbrokers and their affiliates and
agents disclaims to the fullest extent permitted by law all and any
responsibility or liability whatsoever, whether arising in tort,
contract or otherwise, which it might otherwise have in respect of
this Announcement or any such statement.
The New Ordinary Shares will not be admitted to trading on any
stock exchange other than to trading on AIM.
The Appendix to this Announcement sets out the terms and
conditions of the Placing. By participating in the Placing, each
person who is invited to and who chooses to participate in the
Placing by making or accepting an oral and legally binding offer to
acquire Placing Shares will be deemed to have read and understood
this Announcement in its entirety and to be making such offer on
the terms and subject to the conditions set out in this
Announcement and to be providing the representations, warranties,
undertakings and acknowledgements contained in the Appendix.
Members of the public are not eligible to take part in the
Placing and no public offering of Placing Shares is being or will
be made.
Neither the content of the Company's website (or any other
website) nor the content of any website accessible from hyperlinks
on the Company's website (or any other website) is incorporated
into, or forms part of, this Announcement.
NOTICE TO OVERSEAS SHAREHOLDERS
The New Ordinary Shares have not been and will not be registered
or qualified under the relevant laws of any state, province or
territory of the Restricted Jurisdictions and may not be offered or
sold, resold, taken up, transferred, delivered or distributed,
directly or indirectly, into or within any of the Restricted
Jurisdictions except pursuant to an applicable exemption from such
Restricted Jurisdiction's registration or qualification
requirements.
Subject to certain exceptions in compliance with the Securities
Act and the rules promulgated thereunder or any applicable laws in
the Restricted Jurisdictions, this announcement will not be
published, released, or distributed, directly or indirectly; and
must not be sent, in whole or in part: (i) in or into any
Restricted Jurisdictions; (ii) to any person within the United
States; or (iii) to any person in any jurisdiction where to do so
might constitute a violation of local securities laws or
regulation.
The New Ordinary Shares have not been and will not be registered
under the Securities Act or under any securities laws of any state
or other jurisdiction of the United States. The New Ordinary Shares
may not be offered, sold, taken up, exercised, resold, transferred
or delivered, directly or indirectly to or within the United States
or to any person within the United States, except pursuant to an
applicable exemption from, or a transaction not subject to, the
registration requirements of the Securities Act and in compliance
with any applicable securities laws of any state or other
jurisdiction of the United States. There will be no public offer in
the United States.
The New Ordinary Shares have not been approved or disapproved by
the United States' Securities and Exchange Commission, any state
securities commission in the United States or any other US
regulatory authority, nor have any of the foregoing authorities
passed upon or endorsed the merits of the offering of the New
Ordinary Shares or the accuracy or adequacy of this announcement.
Any representation to the contrary is a criminal offence in the
United States.
No action has been taken by the Company or Shore Capital that
would permit an offer of the New Ordinary Shares or possession or
distribution of this announcement or any other offering or
publicity material in any jurisdiction where action for that
purpose is required, other than the United Kingdom. Neither of the
Company, Shore Capital or any of their respective affiliates,
directors, officers, employees or advisers is making any
representation to any offeree, purchaser or acquirer of New
Ordinary Shares regarding the legality of an investment in the New
Ordinary Shares by such offeree, purchaser or acquirer under the
laws applicable to such offeree, purchaser or acquirer. This
announcement does not constitute an offer to sell the New Ordinary
Shares to any person in any jurisdiction. The Company reserves the
right, in its sole and absolute discretion, to reject any
subscription or purchase of the New Ordinary Shares that the
Company or its representatives believe may give rise to a breach or
violation of any law, rule or regulation.
Forward-looking statements
A variety of factors may cause the Company's and its
subsidiaries' (the "Group's") actual results to differ materially
from the forward--looking statements contained in this
Announcement. Certain statements included or incorporated by
reference within this Announcement may constitute "forward-looking
statements" in respect of the group's operations, performance,
prospects and/or financial condition. These forward--looking
statements may be identified by the use of forward--looking
terminology, including the terms "believes", "estimates",
"foresees", "plans", "anticipates", "expects", "intends", "may",
"will", or "could" or words of similar substance or the negative
thereof, or by discussions of strategy, plans, objectives, goals,
economic performance, dividend policy, future events or intentions.
By their nature, forward-looking statements involve a number of
risks, uncertainties and assumptions because they relate to events
and depend on circumstances that may or may not occur in the future
or are beyond the Group's control. Actual results or events may and
often do differ materially from those expressed or implied by those
statements. Any forward--looking statements reflect the Company's
current view with respect to future events and are subject to risks
relating to future events and other risks, uncertainties and
assumptions relating to the Group's business, results of
operations, financial position, liquidity, prospects, growth and
strategies. Forward--looking statements speak only as of the date
they are made. The Group's actual operating results and financial
condition and the development of the industry in which it operates
may differ materially from the impression created by the
forward--looking statements contained in this Announcement.
Important factors that could cause these differences include, but
are not limited to, the ongoing national and international impact
of the Covid-19 pandemic including the current outbreak as a result
of the coronavirus variant and the pace of the rollout of
vaccinations in the United Kingdom, general economic and business
conditions, industry trends, foreign currency rate fluctuations,
competition, changes in government and other regulation, including
in relation to the environment, health and safety and taxation,
labour relations and work stoppages, changes in political and
economic stability and changes in business strategy or development
plans and other risks.
Accordingly, no assurance can be given that any particular
expectation will be met and reliance shall not be placed on any
forward-looking statement. Additionally, forward-looking statements
regarding past trends or activities shall not be taken as a
representation that such trends or activities will continue in the
future. The information contained in this Announcement is subject
to change without notice and no responsibility or obligation is
accepted to update or revise any forward-looking statement
resulting from new information, future events or otherwise.
In particular, no statement in this Announcement is intended to
be a profit forecast and no statement of a financial metric
(including estimates of EBITDA, profit before tax, free cash flow
or net debt) should be interpreted to mean that any financial
metric for the current or future financial years would necessarily
match or exceed the historical published position of the Group. The
estimates set out in this Announcement update have been prepared
based on numerous assumptions and forecasts, including those set
out in this Announcement, some of which are outside of the
Company's influence and/or control, and is therefore inherently
uncertain and there can be no guarantee or assurance that it will
be correct. The estimates have not been audited, reviewed, verified
or subject to any procedures by our auditors. You should not place
undue reliance on them and there can be no guarantee or assurance
that they will be correct.
UK Product Governance Requirements
Solely for the purposes of the product governance requirements
of Chapter 3 of the FCA Handbook Product Intervention and Product
Governance Sourcebook (the "UK MiFIR 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 MiFIR 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 retail investors and investors who meet the criteria of
professional clients and eligible counterparties, each as defined
in paragraphs 3.5 and 3.6 of COBS; and (ii) eligible for
distribution through all permitted distribution channels (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 any
contractual, legal or regulatory selling restrictions in relation
to the Placing. Furthermore, it is noted that, notwithstanding the
Target Market Assessment, Shore Capital Stockbrokers 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 Chapters 9A or 10A respectively of COBS; 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.
EU Product Governance Requirements
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 (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 retail investors and investors who
meet the criteria of professional clients and eligible
counterparties, each as defined in MiFID II; and (ii) eligible for
distribution through all distribution channels as are permitted by
MiFID II (the "EU Target Market Assessment"). Notwithstanding the
EU 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 EU 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 EU Target Market
Assessment, Shore Capital Stockbrokers will only procure investors
who meet the criteria of professional clients and eligible
counterparties.
For the avoidance of doubt, the EU 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.
ADDITIONAL INFORMATION
1. INFORMATION ON THE BOOM BATTLE BARS GROUP
Boom Battle Bars, a fast growing experiential leisure business
offering competitive socialising activities combined with
theatrical cocktails and street food, currently comprises 1
owner-operated venue and 5 franchised venues in the UK. In
addition, 1 owner-operated site and 1 franchise venue are in build,
while contracts have been exchanged on a further 2 owner-operated
sites and 6 franchise sites. The advanced pipeline, which includes
sites in build, those where contracts have been exchanged and sites
for which legal documentation is well advanced, meaning contracts
are expected to be exchanged within 90 days, totals 4
owner-operated sites and 17 franchise sites. The total pipeline of
sites in active discussions, including the advanced pipeline,
referred to above, totals 39 sites comprised of 11 owner-operated
and 28 franchise prospects. Boom Battle Bars also has a
well-developed pipeline of franchisees, with 18 franchisees having
signed franchise agreements. The Boom Battle Bars owner-operated
site is located at the Lakeside shopping centre in Thurrock, Essex,
which opened on 16 July 2021 and is co-located with a Escape Hunt
site which opened to the public on 2 November 2021.
Boom Battle Bars is focused on the growing trend of 'competitive
socialising' offering activities, drinks and food in a casual
cocktail bar setting. The venues house a wide range of games to
play with friends, family or work colleagues and include activities
such as 'crazier golf', Bavarian axe throwing, augmented reality
darts, shuffleboard, electric table tennis, pool, beer pong,
Karaoke, ice curling, 'hammerschlaggen', arcades and others. The
venues are heavily themed around an eclectic urban environment
offering a licensed bar and street style food. The sites are
expected typically to be 5,000 - 15,000 square feet in size and
situated within busy shopping centres or high street leisure
developments.
The core target customer is aged 18-40 years old, and the
concept caters for corporate events, social nights out, date nights
and special occasions as well as general leisure.
As set out above, Boom Battle Bars currently has 5 franchise
sites and 1 owner-operated site. The first two franchise sites
opened in Norwich and Cardiff in July 2020 and November 2020,
respectively, but due to COVID-19 restrictions were only open at
brief intervals in the latter part of 2020. A third franchise site
opened in Liverpool on 20 May 2021; the fourth site, in Eastbourne,
opened on 4 August 2021; and the fifth site opened in Swindon on 15
October 2021. As set out above, Boom Battle Bars' first
owner-operated site opened in the Lakeside shopping centre in Essex
on 16 July 2021. Further details of the pipeline of Boom Battle
Bars sites are set out below.
Owner-operated sites
Revenue at a Boom Battle Bars venue is derived from a
combination of games, drinks and food. Games revenue is expected to
be a core revenue stream, although the mix will vary from site to
site. In the 10 weeks of trading from 2 August 2021 to 10 October
2021, games revenue constituted an average of 38 per cent. of total
revenue across Boom Battle Bars' owner operated site in Lakeside
and the four franchise sites which were open. This is skewed by the
franchise site in Cardiff which has a very high proportion of total
sales from drinks. Excluding Cardiff, the average revenue
contribution from games was approximately 44 per cent., ranging
from a low of 35 per cent. to a high of 55 per cent. Customers are
charged for a fixed time period during which they have access to
the relevant game, with game pricing set at differing levels.
Reservations can be made in advance or on an ad hoc basis through
the Boom Battle Bars Group's customer contact centre, website or in
person at the venue. Game revenue is driven by the number of
visits, games played and price per game.
Boom Battle Bars venues offer a wide range of beers, spirits and
cocktails and a street food style menu. In the 10 weeks of trading
from 2 August 2021 to 10 October 2021, drinks revenue constituted
an average of 56 per cent. and food approximately 5 per cent. of
total Boom Battle Bars revenue across the owner operated site and
its four franchise sites which were open. Excluding Cardiff, the
average proportion of revenue from drinks was 51 per cent. and 5
per cent. from food, with a range of 43 per cent. to 57 per cent.
for drinks and 2 per cent. to 6 per cent. for food. The bars are
typically themed with various 'fun' props and mood lighting with an
urban futuristic décor
Whilst performance of individual sites and the size of venue is
expected to vary, the Directors expect a typical Boom Battle Bars
site to generate between approximately GBP1.2 million and GBP2.5
million of revenue per annum. The capital set-up cost of a typical
Boom Battle Bars site is expected to be approximately GBP0.5
million to GBP0.75 million, although at larger sites this could be
considerably higher. The pipeline of potential sites includes
significant landlord contributions, which in some cases have been
sufficient to cover the substantial majority of the build cost.
The Directors expect that revenue at a typical Boom Battle Bars
venue will be derived from the various sources broadly as
follows:
Type of revenue Price Expected % of
total revenue
================= ============================= ==============================
GBP6 - GBP75 per
Game sessions session 35% - 55%
----------------- ----------------------------- --------------------------------
Food sales GBP8 per head 5% - 10%
----------------- ----------------------------- --------------------------------
Drinks sales GBP12 per head 35% - 60%
================= ============================= ================================
Total Revenue GBP 1.2m - GBP2.5m
================================================ ================================
Principal operating costs at site level comprise staffing; cost
of goods; property costs, including rent, service charge and rates;
marketing costs; and utilities and maintenance. The Directors would
expect a typical site's costs when operating at a typical annual
turnover to represent the following:
Type of Cost % of revenue
========================== ============
Staffing 30% - 35%
-------------------------- ------------
Cost of goods c.10% - 15%
-------------------------- ------------
Property costs c.15% - 20%
-------------------------- ------------
Marketing c.5%
-------------------------- ------------
Utilities and maintenance c.5% - 10%
========================== ============
Total Costs c.70% - 85%
========================== ============
The Directors target a pre-IFRS16 EBITDA margin of between 15
per cent. and 30 per cent., with an owner-operated site delivering
pre-IFRS16 EBITDA of between GBP0.3 million and GBP0.5 million per
annum. The Directors target a cash return on investment in excess
of 30 per cent. per annum (before landlord capital contributions).
Set up costs are typically expected to be between GBP0.5 million
and GBP0.75 million, although they may be higher in the larger,
premium locations.
Franchise
The Directors expect a franchise site to perform similarly, as a
business unit, to an owner-operated site, but the Enlarged Group's
economic return will be lower. Franchisees pay an up-front
territory fee of GBP25,000 plus an GBP18,000 legal completion fee
and a training fee of GBP6,000 on the establishment of the
franchise. Once operating, franchisees pay Boom Battle Bars a 10
per cent. revenue share, and a central marketing fee of 1 per cent
of net sales. In addition, Boom Battle Bars receives up to a 20 per
cent. rebate on equipment installed at the site from the equipment
suppliers.
Boom Battle Bars targets franchisees with a minimum liquidity of
GBP200,000, typically a previous business owner or high net worth
professional aged between 30 and 55. Franchisees are sourced
through a variety of channels, including by exhibiting at franchise
shows, advertising in trade publications, inbound contacts and
through industry contacts.
Boom Battle Bars will typically act as guarantor on the lease or
sign a joint tenancy agreement. Boom Battle Bars has been able to
secure a number of property deals which come with substantial
landlord capital contributions and rent-free periods. The benefit
of this is generally passed on to the franchisee. In return Boom
Battle Bars will obtain personal guarantees and retain full step-in
rights for franchise sites in the event that the franchisee is
unable to operate the site or defaults on any aspect of the
agreement.
A typical franchise site is expected to generate EBITDA
contribution through franchise fees of between GBP0.1 million and
GBP0.2 million per annum.
Pipeline of prospective sites
In addition to the existing sites, Boom Battle Bars has an
advanced pipeline of 21 sites, being sites in build, or in respect
of which contracts have been exchanged or where legal documentation
is well advanced and exchange of contracts is expected within 90
days. Boom Battle Bars also has a further pipeline of 18 other
sites under discussion.
Owner-operated Date opened
Existing sites (O-O) / Franchise / planned Legal status
and Advanced (FS) Size (sqft)
Pipeline
Norwich FS 11,688 Jun-20 Open
Cardiff FS 5,528 Oct-20 Open
Liverpool FS 10,796 May-21 Open
Lakeside O-O 14,508 Jul-21 Open
Eastbourne FS 7,947 Jul-21 Open
Swindon FS 15,000 Oct-21 Open
1 O2 Arena O-O 17,728 Q4 2021 In Build
2 Edinburgh O-O 9,500 Q1 2022 Exchanged
3 Oxford Street O-O 15,000 Q2 2022 Exchanged
4 Exeter O-O 10,000 Q2 2022 Adv. Legals
Wandsworth Rams
5 Q FS 10,140 Q4 2021 In Build
6 Bath FS 8,500 Q1 2022 Exchanged
7 Glasgow FS 10,485 Q1 2022 Exchanged
8 Watford FS 6,635 Q1 2022 Exchanged
9 Coventry FS 7,481 Q2 2022 Exchanged
10 Ealing FS 10,000 Q2 2022 Exchanged
11 Aldgate East FS 8,011 Q2 2022 Exchanged
12 Manchester FS 8,802 Adv. Legals
13 Oxford FS 10,359 Adv. Legals
14 Bournemouth FS 11,000 Adv. Legals
15 Leeds FS 7,000 Adv. Legals
16 Ipswich FS 9,000 Adv. Legals
17 Southampton FS 5,156 Adv. Legals
18 Hull FS 34,053 Adv. Legals
19 Reading FS 7,679 Adv. Legals
20 Sheffield FS 7,920 Adv. Legals
21 Chelmsford FS 9,963 Adv. Legals
--- ----------------- ------------------- -------------- ------------ ---------------
The full pipeline of 39 sites includes a further 7 potential
owner-operated sites and 11 potential franchise sites.
Illustrative potential EBITDA contribution
Based on the Directors' expectation of EBITDA contribution from
Boom Battle Bars owner-operated and franchise sites respectively,
the Directors believe that an illustrative pre-IFRS16 EBITDA run
rate from the advanced pipeline of potential sites is approximately
GBP3.8 million per annum. Based on this illustrative run-rate
EBITDA, the price being paid by the Company for Boom Battle Bars
represents a multiple of 4.57x the illustrative run-rate
EBITDA.
As set out above, Boom Battle Bars' existing sites comprise 1
owner operated and 5 franchise sites. 1 owner-operated site and 1
franchise site are in build; contracts have been exchanged on 2
owner operated sites (including Oxford Street which would be
regarded as a 'super site' by the Directors) and 6 franchise sites.
In total, the Directors plan to have at least 7 owner-operated
sites and 20 franchise sites open by the end of 2022. These plans
are more than covered by potential sites within the existing
pipeline set out above. As a result, the Directors do not expect
the acquisition of appropriate sites to be a constraining factor in
the short to medium term.
Boom Battle Bars' competitive positioning
The Directors are not aware of any other competing competitive
socialising bar concepts available for franchise in the UK. The
Directors therefore believe that Boom Battle Bars will prove to be
attractive to potential franchisees, as evidenced by 18 franchisees
having signed franchise agreements for new sites, including some
existing franchisees for multiple sites, and that this will enable
the concept to grow its presence rapidly, quickly establishing a
national franchised network alongside an owner-operated
network.
The Directors believe the combination of games available at Boom
Battle Bars venues provides an additional attraction for customers
compared to certain of its competitors. However, the Directors
believe the most important differentiators will be location of the
Boom Battle Bars sites and customer experience.
2. BACKGROUND TO AND REASONS FOR THE ACQUISITION
In July 2020, the Company completed a fundraising of GBP4.3
million (before expenses) by way of a placing, open offer, share
subscription and convertible loan note issue. At that time, the
Directors set out a five point plan to build shareholder value,
including a medium term target of 20 owner-operated sites within
its portfolio by the end of June 2022. Since then, the Directors
believe that the Company has made substantial progress on the
objectives set out at that time. Inclusive of the acquisitions of
the Company's Middle Eastern, French and Belgian master franchises,
the Group currently has 18 owner-operated sites, of which 15 are
located in the UK. 14 of these were able to re-open on 17 May 2021
when COVID-19 restrictions imposed during the most recent UK
Government lockdown were lifted, whilst the newest site, located at
the Lakeside shopping centre in Thurrock and is co-located with a
Boom Battle Bars site, opened on 29 October 2021. In addition,
games have been delivered and the strip out / fit out has started
at a site in Milton Keynes where the Company recently signed a
lease agreement. Once opened. this will take the Company's total
owner-operated estate to 19 sites. In addition, there is a pipeline
of several further opportunities, including a number that could be
co-located with Boom Battle Bars. In particular, the Company
intends to open a site in Oxford Street with Boom Battle Bars,
where Boom Battle Bars has already exchanged contracts on a 15,000
square feet site in a prime location a short walk from Oxford
Circus. If the Company is able to open the two further
owner-operated sites set out above by the end of Q1 2022, it would
mean that the Company will have met its target set in July 2020
comfortably ahead of schedule.
The Directors believe that there is now an opportunity to build
on the progress made and to accelerate the Group's progress beyond
escape rooms into other experiential leisure activities. The
Directors believe this opportunity derives from an unprecedented
combination of favourable commercial property market conditions and
a positive outlook for spending on experiences as follows: -
-- The experiential leisure market was experiencing strong
growth prior to the onset of COVID-19;
-- The trading performance in the UK since re-opening on 17 May
2021 has been stronger than the Board expected and as a result, the
Directors believe that consumer desire for experiences will
continue, reinforcing the trends seen previously; and
-- Sentiment surveys show consumers prioritising 'going out' and
other 'experiential leisure' activities. In addition, the Directors
believe there has been a significant increase in activity-based
social entertainment.
Since the Company's fundraising in July 2020, referred to above,
the Directors believe the impact of the COVID-19 pandemic on the
retail commercial property market and leisure industry has become
more evident.
-- The closure of a number of well-known high street large
format stores such as BHS, Debenhams, Top Shop and a number of John
Lewis stores has created voids in many shopping centres;
-- The leisure industry has also witnessed a number of
casualties with several well-known casual dining businesses, such
as Bella Italia, Café Rouge, Chiquito, Frankie & Benny,
Carluccio's, Byron Burger, ASK, Zizzi, Pizza Express, Wahaca and
Gourmet Burger Kitchen closing down or dramatically reducing their
footprint; and
-- The impact of COVID-19 has increased pressure on landlords at
a time when they were already struggling to occupy empty units.
As a result, many shopping centres and other retail destinations
are experiencing significant voids and the Directors believe that
this offers an attractive once in a generation opportunity for
expansion of the Enlarged Group.
-- Institutional landlords are increasingly considering
alternative use options, including leisure, to fill these voids in
what were historically shops or casual dining restaurants;
-- Typically, the larger the size of the vacant unit, the fewer
the number of operators who are prepared to occupy the site. In the
Directors' experience, landlords prioritise letting of large units
to anchor tenants, as flagship sites lying vacant can devalue the
entire scheme; and
-- As a result, many landlords are prepared to offer substantial
financial incentives to potential anchor tenants by way of up-front
capital contributions and/or lengthy rent free periods. These
incentives significantly reduce the cash requirements for operators
to establish and operate sites, improving the potential returns
that can be generated and the ability to attract franchisees.
Boom Battle Bars is able to operate from larger format venues
than Escape Hunt and, as such, has been able to secure deals with
landlords on terms which the Directors believe are very attractive
and, to the knowledge of the Directors, which were not generally
available prior to the onset of COVID-19. The Directors believe
that many of these venues would benefit from having multiple
experiential leisure brands, which provides the opportunity to
locate Escape Hunt escape rooms within or close to the venues which
are or will be occupied by a Boom Battle Bars. The first example of
such a shared venue will be in the Lakeside shopping centre in
Thurrock, Essex which is the first owner-operated Boom Battle Bars
and will also comprise a Escape Hunt. The site opened with a full
Boom Battle Bars offering on 16 July 2021, whilst the escape rooms
at the same venue opened on 29 October 2021.
As a consequence, the Directors believe that the Acquisition
presents an unprecedented opportunity to benefit from the trends in
experiential leisure and take advantage of the conditions in the
retail commercial property market to create in the Enlarged Group a
business which has the potential to become one of the UK's
pre-eminent experiential leisure businesses. Furthermore, they
believe that the opportunity for growth, cash generation and
profitability is greater for the combined businesses than for the
individual constituents and that there is the potential to generate
operational synergies, principally from the following four
areas:-
1. Co-location of sites:
-- Increased scale and buying power are expected to reduce the cost of a site fit-out; and
-- Services at a site, such as reception areas, food and
beverage offering and maintenance, can be shared across the two
formats.
2. Cross marketing
-- The Directors believe that there will be a significant
cross-over of target markets between Escape Hunt and Boom Battle
Bars, giving rise to the potential to cross market, create loyalty
and reward schemes, and multi-buy tickets;
-- Shared consumer databases are expected to increase the number
of people to whom the Enlarged Group can market directly; and
-- The Directors are exploring the opportunity for a wider
corporate events service which can cover escape room experiences,
digital team building, team nights out and conference
activities.
3. Management
-- The Directors believe that the existing management teams of
Boom Battle Bars and Escape Hunt are highly complementary. The Boom
Battle Bars Group has reached a stage in its growth at which it
would be looking to invest more heavily in senior management
resources and governance. Escape Hunt has these structures,
processes and procedures in place which can be leveraged
effectively across the Enlarged Group.
-- Conversely, the Directors believe that the pace of execution
and creativity demonstrated by the Boom Battle Bars Group will
benefit the existing Escape Hunt business.
-- The Directors believe that the Enlarged Group's central
resources and operational teams will be better leveraged, setting
the foundations for a company which can grow quickly and
efficiently.
4. Central costs
-- The Directors expect the Enlarged Group will benefit from
shared central services such as group finance, marketing, legal,
human resources, information technology, and company
secretarial.
3. MARKET OPPORTUNITY AND GROWTH STRATEGY FOR THE ENLARGED GROUP
Market overview
The Directors plan to expand the business rapidly over the
coming years, in part taking advantage of certain market dynamics
which are set out below.
1. Consumer Trends
Expenditure on experiences has seen significant growth over the
last 20 years, and this progression is expected to continue.
According to the Bureau of Economic Analysis, by 2030 the share of
discretionary expenditure spent on experiences and experiential
products is expected to have risen to 48 per cent., and a recent
Eventbrite study showed that 65 per cent. of millennials would
sooner choose a desirable experience over a desirable product ([1])
.
In particular, millennial customers no longer value traditional
measures of success as highly, such as the ownership of property,
and instead place higher value on experiences which they can have
and share more broadly ([2]) .
The Directors believe that consumers have an innate desire for
togetherness and memory making, and following a 15 month period of
forced social inactivity brought about by COVID-19, expect there to
be pent up demand for the Enlarged Group's services. More broadly,
the Directors believe that the Enlarged Group is particularly well
positioned to take advantage of the macro shift towards the
experience economy.
2. Availability of sites
The Directors are seeing a significant number of potential sites
becoming available on substantially better terms than would have
been available pre-COVID-19.
Moreover, the incentives on offer through rent free periods
and/or capital contributions made available by commercial property
landlords have increased materially. The Directors believe that
this may be due to nervousness by landlords that it might be hard
to find tenants in the short to medium term.
With the impact of rent arrears and debt burdens not yet fully
crystallised, the Directors expect future creditor voluntary
arrangements and administrations to further increase the
availability of desirable potential sites on attractive terms.
The Directors believe that the Acquisition provides immediate
access to a network of existing trading sites and a well-developed
pipeline of new sites which have either been signed or are in
negotiation, many of which come with substantial landlord
contributions. In addition, a number of contracts have been signed
with franchisees ahead of opening new sites. Further details of the
pipeline are set out below. As such, the Directors believe that the
Acquisition provides access to a network of both established and
potential sites which can be fitted out at minimal cost to the
Enlarged Group (net of landlord contributions) which together will
provide a substantial, invested asset base from which the Enlarged
Group has the opportunity to generate significant revenue in
future.
3. Decreased competition
The pressures of 2020 have been significant on the leisure
industry and the Directors expect that a number of competitors will
struggle to survive.
There have already been a number of closures in the leisure
industry generally, and the Directors expect there to be more as
the effect of the unwinding of UK Government support is felt.
Growth Strategy
In July 2020, at the time of its fundraising referred to above,
Escape Hunt set out a five point plan to build shareholder value.
The Directors believe that the Acquisition is highly complementary
and, as such, the growth strategy remains broadly the same for the
Enlarged Group as it was for the Group just over a year ago.
The Directors have established a four point plan to build
shareholder value in the Enlarged Group, details of which are set
out below: -
1. Maximise the UK footprint by rolling out each brand, either
through direct investment into owner-operated sites or through
franchises
The Directors have set the following UK targets for each of the
brands within the Enlarged Group: -
ESCAPE HUNT BOOM BATTLE BAR
=========================== ======================= ====================
Existing sites 15 UK sites 1 owner operated
5 franchise
Short term target: 16 UK owner operated 2 UK owner operated
End 2021 6 franchise
Target: 6 - 18 months 21 UK owner operated 7 UK owner operated
(end 2022) 20 franchise
Potential sites (long
term - 5yrs+) 50+ 100+
Primary operating model O+O Franchise
Expected approximate 1/5 vs 4/5 2/3 vs 1/3
split (Franchise vs
Owner-operated)
=========================== ======================= ====================
The targets for the Escape Hunt brand have not changed
materially, although the Directors believe that a number of new
sites in future will be co-located with a Boom Battle Bars. As set
out above, the Directors have a long term ambition of 50 Escape
Hunt sites in the UK. In the short term, with access to the net
funds from the Fundraising, the target is to open a further site in
the UK in Milton Keynes by the end of 2021, and a further 5 in the
12 months thereafter, including on Oxford Street in Q1 2022.
The Directors consider that the short term focus for the Boom
Battle Bars brand is to increase rapidly the number of sites in the
UK, taking advantage of the prevailing favourable commercial
property market conditions and an exciting competitive socialising
concept. Short term plans are to have 8 sites open in the UK by the
end of 2021 and 27 by the end of 2022. The Directors believe that
this provides an opportunity to build a substantial network of
sites over the longer term.
Further details of the pipeline of potential new sites for Boom
Battle Bars are set out above.
Franchise versus owner-operated
Whilst for the Escape Hunt brand, the UK roll-out to date has
been restricted to owner-operated sites, Boom Battle Bars has a
combination of 5 franchise sites and 1 owner-operated site with a
further 17 franchise sites and 4 owner-operated sites in the
advanced pipeline.
There are benefits of expanding through franchises, such as
lower capital investment, reduced involvement in day-to-day
operations, the ability to grow the network faster, and that in
many cases, local ownership and know-how can lead to a more
motivated and effective local management. However, the total profit
and return that can be earned by the Enlarged Group from a
franchise site is lower than from a well-managed owner-operated
site.
The Enlarged Group's strategy in the UK is therefore to grow
through a combination of franchise and owner-operated venues. In
the case of the Escape Hunt brand, the default in the UK will be
owner-operated, but, in time, franchise sites in the UK are likely
as the Directors expect that, in future, some franchisees may seek
to co-locate Escape Hunt alongside a Boom Battle Bars as is planned
for certain venues (such as the Lakeside shopping centre in
Thurrock, Essex, and Oxford Street in central London) in the
Enlarged Group's owner-operated estate going forward. The Directors
would expect a Escape Hunt network split of approximately 20 per
cent. franchise sites and 80 per cent. owner-operated sites in the
UK.
In the case of Boom Battle Bars, the default option in the UK
will be franchised sites. However, each potential venue will be
assessed on its own merits. Certain strategically important
locations will be owner-operated and, where suitable sites are
available on attractive terms, they will be developed as
owner-operated sites if a suitable franchisee is not available.
The Directors anticipate in the longer term that, of the Boom
Battle Bars sites in the UK, approximately one-third will be
owner-operated and approximately two-thirds will be franchised.
However, Shareholders and potential investors should note that
in all cases, as set out above, because Boom Battle Bars typically
guarantees the lease obligation for the franchised venue,
franchises will not be established in venues unless the senior
management of Boom Battle Bars would themselves be prepared to
operate the site and believe that it would be successful.
The plans to expand the Boom Battle Bars network in the UK are
underpinned by the pipeline of sites in discussion as set out
above.
2. Accelerate growth in international territories, predominantly through franchises
The Directors believe that there is a significant opportunity
for each brand internationally, although the immediacy of
international growth will differ for each business. Ultimately
however, it is the Directors' current intention that a
predominantly franchise strategy will underpin any expansion
throughout international territories.
For Escape Hunt, the plans are as previously set out. The
Directors plan to continue to focus on growing the US business in
partnership with PCH. A number of 'Discovery Days' are expected to
be held and prospective franchisees are being vetted. A 'super
centre' has been established in Houston, Texas which has received
its next two catalogue games for installation which is currently in
progress. The Group is also exploring opportunities to develop the
franchise network in the Middle East following the acquisition of
the master franchise in the region in September 2020.
For Boom Battle Bars, the focus will initially be on the UK. In
the mid-term, international franchise opportunities will be
explored, which the Directors expect to be done by leveraging the
relationships of the Boom Battle Bars management team and more
broadly of the Enlarged Group.
In time, the Directors believe that the proposition will become
increasingly attractive since multi-brand deals are expected to
allow franchisees to fill larger spaces resulting in lower property
costs per square foot and improved operating leverage.
3. Continue to develop new products and markets which facilitate the growth of B2B sales
The Enlarged Group will continue to innovate and develop
products that provide access to a broader range of customer
markets. In June 2021, the Board identified four customer segments
which it would target as part of the strategy articulated at the
time. The Directors believe that these four customer segments
remain highly relevant to the Enlarged Group, highlighting how well
the Directors believe the entities fit together.
The four target segments identified, together with the
anticipated product mix are:
Escape
Hunt * Digital offerings for global teams * Gamification of learning and assessment * Activations for TV / Film studios * Social entertainment experiences
* L&D, Training * Brand licenses * Physical, virtual, indoor and outdoor
------------------------------------------ ----------------------------------------------- ------------------------------------------ -----------------------------------------------
Boom -
Battle * Team building * Brand endorsements and sponsorship * Competitive socialising between friends
Bars
* Corporate socials
------------------------------------------ ----------------------------------------------- ------------------------------------------ -----------------------------------------------
4. Integrate the businesses, exploit the synergies where
possible, and develop an infrastructure that supports scale and
future growth
Once fully integrated, the Directors believe the Enlarged Group
has the potential to become one of the UK's leading experiential
leisure companies.
The Directors have identified four areas of focus for the
integration of the businesses:
Embrace each other's culture
The Directors aim to build an environment where the companies'
respective cultures are allowed to flourish. To do this, they aim
to identify and embrace the respective DNA and values which
underpin the success of each business.
Exploit the market opportunity
The Directors aim to use enhanced scale and breadth to
capitalise on the current commercial property market conditions.
The Directors aim to become landlords' "go-to" operator for any
space between 3,000 and 20,000 square feet, and to leverage that
advantage in the lifetime rental costs of properties in the
network.
Leverage operating synergies
Where possible, the Directors plan to co-locate brands and to
introduce cross-marketing initiatives between customer pools.
The Directors plan to flex the corporate sales team across each
business to grow the 'for Business' proposition across the Enlarged
Group.
Invest in back office
The Directors have identified a number of systems and processes
which can be applied across the Enlarged Group and plan to
consolidate all underlying systems and processes for maximum
efficiency. One such example will be a move to a single finance
system for consistency across the reporting entities.
In addition, the Directors aim to rebuild the Enlarged Group's
web and digital presence to allow fluid customer journeys between
brands.
Impact on employees
The Directors believe that the businesses of Escape Hunt and
Boom Battle Bars are highly complementary. Both are relatively
young brands which have been expanding and the Enlarged Group's
strategy, as set out above, is to continue to grow organically by
expanding the network of their respective sites in the UK and
internationally and by developing new products and target
markets.
The Directors do not expect any redundancies to arise from the
Acquisition. The plans in place to combine Escape Hunt's head
office and central functions with those of the Boom Battle Bars
Group and to operate as the Enlarged Group, are expected to
generate operational efficiencies in future and to provide new
career development opportunities for employees at all levels in the
Enlarged Group.
4. PRINCIPAL TERMS AND CONDITIONS OF THE ACQUISITION
On 3 November 2021, the Company entered into the Acquisition
Agreement, pursuant to which it has conditionally agreed to acquire
the Boom Battle Bars Group. The consideration is to be satisfied
by: -
(i) GBP9.88 million in cash (raised through the Placing); and
(ii) conditional on the performance of the Boom Battle Bars
Group following Completion, the issue of some or all of the
Consideration Shares to the Seller; and
At the Issue Price, the Consideration Shares (together with the
cash) imply a value of approximately GBP17.38 million for the
entire issued share capital of Boom Battle Bars.
Completion of the Acquisition is conditional, amongst other
things, upon:
-- Shareholder approval of the Resolutions to be numbered 1 and
2 in the Notice of General Meeting;
-- the Placing and Open Offer Agreement having become
unconditional in all respects; and
-- Admission.
The Seller has given customary warranties (and the Seller has
given certain indemnities) pursuant to the Acquisition
Agreement.
The issue of the Consideration Shares is conditional on the
performance of the Boom Battle Bars Group following Completion. The
Consideration Shares are subject to an earn-out and will only be
issued if the performance of the Boom Battle Bars Group in the
financial year ending 31 December 2022 meets a combination of the
turnover and site roll-out targets set out below. The Consideration
Shares are expected to be issued during the first half of 2023 and
will be subject to a customary lock-in until 15 July 2023.
The turnover component comprises 66.7 per cent. of the earn-out
calculation and the site roll-out plan makes up the balance of 33.3
per cent, (with 20 per cent. linked to owner operated sites and
13.3 per cent. linked to franchise sites). There is a limited
ability for an over-performance against one target to compensate
for potential under-performance against another such that the
turnover component can comprise a maximum of 75% of the earn-out
calculation, if the turnover target is exceeded but the site
roll-out target is not achieved, and the site roll-out plan a
maximum of 40% of the earn-out calculation, if the site roll-out
plan is exceeded but the turnover earn-out target is not achieved.
.
The earn-out target numbers are:
-- GBP10.96 million combined turnover from the owner-operated
sites and from the franchise revenue share in the year to 31
December 2022;
-- 7 owner operated sites open by 31 December 2022; and
-- 20 franchise sites open by 31 December 2022 .
If each of these earn-out targets is achieved in full then the
maximum number of Consideration Shares will be issued to the
Seller.
If the earn-out targets are not satisfied in full then there is
a reducing straight line sliding scale for the partial achievement
of each component of the earn-out down to the minimum criteria. If
the minimum criteria are not met in every element of the earn-out
then no Consideration Shares will be issued. The minimum criteria
for each element of the earn-out are:
-- GBP8.15 million combined turnover from the owner-operated
sites and from the franchise revenue share in the year to 31
December 2022;
-- 13 franchise sites open by 31 December 2022; and
-- 5 owner operated sites open by 31 December 2022.
In addition, alongside the Acquisition Agreement, the Company
has been granted a two year exclusivity period by MFT Capital to
negotiate final terms to acquire Flip Out, a family focused leisure
entertainment business and the UK's largest trampoline operator by
number of sites, for an amount determined with reference to the
trading performance of Flip Out in the twelve months prior to the
acquisition, subject to a minimum enterprise value of GBP40
million. If the Company proceeds with the acquisition of Flip Out,
the consideration for the acquisition, which may require
Shareholder approval at the time, is expected to be satisfied by
the issue of new Ordinary Shares, although it may be paid in cash
at the Seller's option, conditional on funding.
Flip Out is the UK's largest trampoline operator by number of
sites, with an existing portfolio of 28 trampoline and adventure
parks. Nine are owner-operated and 19 are operated by franchisees
across the UK, in each case under the Flip Out franchise brand.
Historically, the adventure parks have been located predominantly
in out-of-town industrial estates or multi-use leisure parks.
However, more recently there has been a shift into shopping
centres, supported by demand for experience-led offerings within
shopping centre schemes and availability of retail space on terms
which the Directors believe to be attractive. The adventure parks
are designed with wall-to-wall activities which may include
trampolines, assault courses, slides, climbing, laser tag,
inflatables, ice rinks, bumper cars, laser maze, soft play and
others. Each site has an onsite cafe and family games arcades. The
target market is typically children from age 4 - 14.
The MFT Capital group currently owns the rights to the Flip Out
brand in the UK and all other international territories other than
in Australia and New Zealand.
Any decision to acquire Flip Out will be conditional on agreeing
the detailed terms of such acquisition and on any regulatory and/or
Shareholder approvals which may be required at the time.
The acquisition of Flip Out is entirely at Escape Hunt's
discretion. The value of the consideration will be determined by a
formula, summarised as follows:
The target will be valued at an enterprise value which will be
calculated at the higher of:
-- GBP40 million; and
-- the value determined by a pricing mechanism which will apply
to both franchise sites (recurring revenue only) and owner operated
sites. The principle is to apply reducing multiples of EBITDA to
different components of the business:
a. 7.5x actual EBITDA ([3]) for sites that have been open for 12 months, net of head office costs
b. For owner operated or franchise sites that have traded for 9
- 12 months; 5.5x grossed up EBITDA (seasonally adjusted);
c. For owner operated or franchise sites that have traded for 6
- 9 months; 4.5x grossed up EBITDA (seasonally adjusted);
d. Franchise and owner-operated sites that are not opened or
have opened within 6 months; 4.5x forecast EBITDA from the first 12
months of operation. This is conditional on the enterprise value of
the Flip Out group being determined to be greater than GBP40
million at the time of acquisition. The consideration in relation
to these sites, insofar as it renders the total enterprise value to
be more than GBP40 million will be retained (the "Retention") and
will be released as soon as reasonably practicable after the last
site in relation to which such Retention has been held has
completed 12 months of trading. The Retention in relation to each
site will then be recalculated. Provided that in aggregate the
sites have met or exceeded their forecasts, the full amount of the
Retention will be paid. However, if the forecasts are not achieved,
the payment from the Retention will be reduced by 4.5x the amount
by which the actual performance is less than the forecast provided
that such reduction will not reduce the overall enterprise value
below GBP40 million; and
e. For franchise agreements signed but not open, 0.25x future
(as yet not paid) upfront exclusivity fees and equipment
rebates.
The consideration paid for Flip Out will be the enterprise
value, less the net debt in the business at the date of
acquisition.
The Directors expect the application of the above formula to
result in a valuation of approximately 6x the run-rate pre-IFRS16
EBITDA of Flip Out on the date of acquisition.
5. UNAUDITED INTERIM RESULTS OF ESCAPE HUNT FOR THE SIX MONTHSED 30 JUNE 2021
On 28 September 2021, the Company released its unaudited interim
results for the six months ended 30 June 2021.
Group revenue in the first half was GBP1,178k (H1 2020:
GBP1,306k) comprising GBP936k (H1 2020: GBP1,017k) from
owner-operated sites and GBP242k (H1 2020: GBP287k) from the
franchise network reflecting a period when across the estate, many
franchise sites were closed. Downloadable print and play games
together with remote play and digital games contributed GBP151k to
revenue (H1 2020: GBP53k). Whilst gross profit margin was lower
than the comparable period in the prior year, this was largely as a
result of direct labour training costs incurred prior to re-opening
and the cumulative, although relatively small, costs not covered by
furlough payments during lockdown.
Site level EBITDA from the Group's owner-operated sites was
GBP199k (H1 2020: GBP254k) reflecting modest cost reductions helped
by furlough, and the benefit received from Government support
schemes during lockdown. The P&L benefit from the Government
rates holiday and rates-related grants totalled GBP432k in the
period of which GBP341k was received in cash grants and the balance
being the benefit of the rates holiday.
Central costs, including costs allocated to owner-operated sites
and the franchise network in aggregate fell 9% to GBP1,237k (H1
2019: GBP1,359k). Much of this can be attributed to the success of
all our head office staff working from home, which led to a
decision to exercise a break clause in our head office property
lease which terminated in Q1 2021. This is expected to lead to
annualised savings of over GBP100k per annum. We have been
successfully making use of more flexible working arrangements
whilst providing a location in central London for colleagues to
meet and work together when necessary. The overall cost reflects a
30% reduction compared to central costs in the same period in 2019
illustrating the impact of a number of enduring cost cuts. As the
Group resumes its planned growth trajectory, central costs are
expected to rise, although at a significantly lower rate than
turnover and gross profit as we expect a substantial operational
gearing benefit.
Group Adjusted EBITDA loss reduced to GBP796k (H1 2020:
GBP816k).
Six months Six months
ended June ended June
2021 2020
GBP'000 GBP'000
Adjusted EBITDA (796) (816)
Amortisation of intangibles (216) (1,078)
Depreciation (1,038) (1,111)
Rent credits recognised 25 -
Loss on disposal of tangible
assets (18) -
Branch closure costs and
other exceptional costs (147) -
Foreign currency gains /
(losses) (6) -
Share-based payment expense (26) (5)
----------------------------- ------------ -----------
Operating loss (2,222) (3,010)
----------------------------- ------------ -----------
Group operating loss reduced by 27% to GBP2,222k (H1 2020:
GBP3,010k) and the total comprehensive loss for the period was
GBP2,390k (H1 2020: GBP3,073k). Branch closure and other
exceptional costs include costs associated with the acquisition of
the French and Belgian master franchise, and provision against the
remaining balance on a loan made to a franchisee several years
ago.
The Company continued to manage cash carefully, with net cash
used in operating activities of GBP100k (H1 2020: GBP94k). The
movement was helped by GBP836k of positive working capital
movements.
The Group had GBP2,414k cash on hand at the end of the period
(31 Dec 2020: GBP2,722k). Cash was boosted by the GBP1.4m fund
raising which completed on 28 January 2021.
In September 2021, the Group received GBP1.2m cash (GBP950k net
of associated fees) in respect of research and development grants
from HMRC. The grant will be recognised in H2 and is in addition to
the GBP256k (GBP207k net of fees) recognised in 2020. The cash
receipt has further boosted the Group's cash reserves.
Cash on hand at 30 September 2021 was GBP3.5 million.
6. CURRENT TRADING AND PROSPECTS OF THE ENLARGED GROUP
Escape Hunt
Consumer demand returned strongly as COVID restrictions lifted
in both the UK and many of the other regions in which Escape Hunt
operates. The Board was optimistic that that demand would return in
the UK and Europe once sites were allowed to re-open and were
delighted to see that it continued to build through July and August
to record levels of performance. The Board believes that Escape
Rooms have entered the consumer psyche and it is now becoming a
natural consideration of 'things to do' alongside more traditional
leisure activities and believes this is part of a broader growth
trend in experiential leisure.
One aspect of the recent performance has been the five-star
TripAdvisor ratings and / or number one TripAdvisor(TM) ranking all
the sites in the UK enjoy including the newly opened sites. In
August 2021, all the UK sites which had been open for more than a
year, and therefore eligible for consideration, received the
prestigious TripAdvisor(TM) Travellers' Choice awards, placing them
in the top 10% of businesses listed on TripAdvisor(TM). The Board
believes this has been helped by the performance of the staff at
sites.
The Company made further strategic progress in the period. The
acquisition the former French and Belgian master franchise added to
the owner operated estate bringing an owner operated site in each
of Paris and Brussels. The Group also opened two new owner operated
sites in the UK in Watford and Kingston respectively and is in the
process of building two further sites - one at the Lakeside
shopping centre in Essex and one in Milton Keynes. The Board
believes the returns being generated at the new UK sites are
attractive to Shareholders and is actively evaluating a number of
further sites helped by favourable property conditions.
The performance of the owner operated estate since re-opening
has further demonstrated the what the Board believes to be an
attractive business model. The estate as a whole has outperformed
against the target 'box economics', whilst still showing growth.
The Board believes that the site level EBITDA margins achieved,
notwithstanding the short-term help from a lower VAT rate and
business rates holiday, have been particularly encouraging.
Within the franchise estate, different countries have been
affected in different ways. However, overall, the estate performed
well and, whilst a small number of sites have been forced to close
as a result of financial hardship under COVID, those that have
survived have been performing again with a number registering
record weekly revenue performances.
The Board believes that there is a significant opportunity both
in the UK and more widely in the retail property market and that
Escape Hunt is well positioned to take advantage of the more
attractive terms on offer. In turn, the Board expects this to make
future sites even more financially attractive than before.
OWNER OPERATED SITES
UK
The Company's UK estate re-opened to the public on 17 May 2021,
following a protracted COVID lockdown enforced by the UK
Government. The Board believes that, since re-opening, trading at
the Company's UK sites has been very encouraging.
Revenue and EBITDA from the UK owner operated estate was
significantly ahead of the Board's expectations in the 19 weeks
between 17 May 2021 and 26 September 2021. Revenue for the 8 sites
which were open in the same period in 2019 was up 17% compared to
the same period in 2019. At an EBITDA level, the performance
reflected an important milestone with each of July, August and
September being profitable at group EBITDA level. In the 19 weeks
of trading to 26 September 2021, site level EBITDA from the eight
sites that were open in the same period in 2019 was 177% higher
than in the same period in 2019.
Across all UK sites, including the sites not open in the
comparable period in 2019, revenue in the 19-week period to 26
September 2021 grew by 92% compared to 2019, and site level EBITDA
grew by 329%.
Five of the six newest UK sites performed in line with high
performing, more mature sites. The sixth site has shown good growth
and traded profitably, albeit operating at reduced capacity whilst
awaiting its full complement of games.
Dubai
The site in Dubai was open throughout the six months to 30 June
2021, although trading was impacted to some extent by COVID
restrictions. Nevertheless, the Dubai site delivered a performance
over the period which was marginally ahead of the Board's
expectations. Following a strong performance in July 2021 and
profitable months in August 2021 and September 2021, the profits
generated from Dubai since its acquisition in October 2020 have
more than covered the acquisition cost, inclusive of fees, leading
to a payback of significantly less than one year.
The team in Dubai has recently won a tender to participate in
the 'Riyadh Season', which is an Expo funded by the government of
Saudi Arabia to promote tourism and leisure. The Expo runs for a
number of months from 1 October 2021 and Escape Hunt will be
present with both physical and VR games. The costs are all covered
by the Expo's promoters and the Board believes that the event
provides an excellent opportunity to test the new modular designed
games whilst promoting the brand to both consumers and potential
franchisees. The event is expected to generate a meaningful
contribution for the Middle East business in the current financial
year.
France and Belgium
The acquisition of the master franchise for France and Belgium
completed on 8 March 2021. Excluding earnout, the consideration
represented approximately 1x the business' historic EBITDA and was
funded using a portion of the proceeds from a placing of 8 million
shares at 17.5p per share which was announced on 28 January 2021.
As a condition of the deal, the Group's six leading franchisees in
France all signed new franchise agreements, extending for a further
six years on renewed terms. with them.
Lockdown in both Belgium and France was extended until early
June 2021. However, both France and Belgium have seen a resumption
of business and, taking into account the delayed re-opening, have
been performing in line with our expectations. The Board remains
confident of generating a very good return on capital from the
acquisition and in building on the progress made in the region by
the previous owners.
FRANCHISE OPERATIONS
International franchise
Whilst Australia enjoyed a period of relative freedom from COVID
in Q1 and Q2 2021, a number of Australian sites had to close again
in August due to renewed lockdowns. France and other northern
European countries all endured long lockdown periods which until
June 2021. When sites have been open, it performance has
demonstrated that there is considerable consumer demand, so the
Board is confident that the estate will return to previous
performance levels. The Board has been going through a process to
refresh the franchise relationships increasingly interacting
directly rather than through a master franchisee and the Board
believes this approach is paying off. Significant progress has been
made towards developing the games catalogue, which is designed to
deliver higher quality games and associated collateral to the
franchise network.
US franchise
Progress in the US has been impacted by COVID notably through
the effects on travel. The Group's area representative in the USA,
PCH, is establishing a 'super centre' in Houston which is intended
to serve as the hub from which they can showcase an Escape Hunt
site to prospective franchisees. New modular design games have been
built, have been delivered to Houston and, following delays due to
travel restrictions, are now being installed.
OUTLOOK
Trading since 30 June 2021 has been significantly stronger than
the Board had expected as COVID restrictions have been relaxed.
The newly acquired businesses in Dubai, France and Belgium are
likewise performing satisfactorily. Whilst a number of Australian
cities went back into lockdown in August, all sites in the Group's
French estate are open and business is returning as expected. Sites
in other parts of the world likewise are returning in line with
expectations.
The Group reached a significant milestone, delivering a positive
group level EBITDA in each of July, August and September 2021. With
the foundations laid for a profitable and cash generative business,
the Board is confident for the future of Escape Hunt.
The Boom Battle Bars Group
Both of Boom Battle Bars' UK franchise sites then operating were
closed from 31 December 2020 due to the UK Government lockdown
measures related to COVID-19.
Both franchise sites in Cardiff and Norwich re-opened once
restrictions were lifted. New franchise sites opened in Liverpool
on 20 May 2021, in Eastbourne on 4 August 2021, and in Swindon on
15 October 2021. Boom Battle Bars' first owner-operated site opened
at the Lakeside shopping centre in Thurrock, Essex, on 16 July
2021. Sites at the O2 Arena in London (owner operated) and in
Wandsworth (franchise) are currently in build and due to open
before the end of 2021.
Revenue from the four franchise sites operating in the 10 weeks
to 10 October 2021 has been approximately 45 per cent. ahead of
management's internal forecasts. Annualised revenue from the four
sites in the same period since has been 33 per cent. ahead of the
'mature' annual revenue expected from the four sites. Revenue from
the owner operated site in Lakeside has likewise been 22 per cent.
ahead of management's expectations in the 10 weeks to 10 October
2021.
Significant progress has been made on developing the pipeline of
new sites, with a new site opening recently in Swindon and 17 new
franchisees signing franchise agreements. In addition, 1 owner
operated site and 1 franchise site are currently in build, whilst
leases have been signed for a further 2 owner-operated sites and 6
franchise sites. A further 11 sites are in advanced discussions.
The total potential landlord contributions for the 21 sites in the
advanced pipeline currently under discussion is GBP7.6 million,
with the recently opened site in Swindon also having attracted a
GBP0.5m landlord contribution.
Progress in signing sites and franchise agreements underpins the
Directors' plans to expand the Boom Battle Bars network.
The performance since re-opening gives the Directors confidence
that trading at Boom Battle Bars will continue to remain strong for
the remainder of the year. The Directors believe that becoming part
of the Enlarged Group will allow for shared cost savings and enable
combined marketing initiatives to be actioned creating a solid
platform to continue the growth strategy.
7. INFORMATION ON THE FUNDRAISING
In order to pay for the cash element of the consideration
payable for the Acquisition, for operational
improvements/integration of Boom Battle Bars, for new sites, to
meet the costs and expenses of the Proposals and for general
working capital purposes, the Company is seeking to raise GBP15.0
million (gross) (GBP13.88 million net of expenses (including VAT))
pursuant to the Placing and the Subscription through the issue of
the Placing Shares and the Subscription Shares at the Issue Price.
The Placing Shares and the Subscription Shares will represent
approximately 8.8 per cent. of the Enlarged Share Capital.
Furthermore, the Company is making an Open Offer pursuant to
which it may raise up to an additional GBP2.2 million (before
expenses). The Issue Price of 30 pence per Open Offer Share is the
same as the price at which the Placing Shares and the Subscription
Shares are being issued.
Following Admission, the Placing Shares, Subscription Shares and
Open Offer Shares will rank pari passu with the Existing Ordinary
Shares. Application will be made for the admission of the Placing
Shares, the Subscription Shares and the Open Offer Shares , to
trading on AIM, which is expected to take place at 8.00 a.m. on 23
November 2021.
Placing
Pursuant to the terms of the Placing and Open Offer Agreement,
Shore Capital Stockbrokers, as agent for the Company, has
conditionally agreed to use its reasonable endeavours to place the
Placing Shares at the Issue Price.
The Placing is conditional upon the Placing and Open Offer
Agreement becoming unconditional and not having been terminated in
accordance with its terms. The Placing is not being
underwritten.
Shore Capital's obligations under the Placing and Open Offer
Agreement in respect of the EIS Placing Shares are conditional on,
inter alia,:
i. the passing by the Shareholders of the Resolutions numbered 1
and 2 by the requisite majorities of Shareholders at the General
Meeting; and
ii. the EIS Placing Shares having been unconditionally allotted
and issued by the Company at or before 11.59 p.m. on the day
immediately prior to the Expected Admission Date.
Shore Capital's obligations under the Placing and Open Offer
Agreement in respect of the VCT Placing Shares are conditional on,
inter alia:
i. all the conditions in the Placing and Open Offer Agreement
relating to the placing of the EIS Placing Shares having been
fulfilled (or, where applicable, waived); and
ii. the VCT Placing Shares having been unconditionally allotted
and issued by the Company at or before 7.30 a.m. on the Expected
Admission Date.
Shore Capital's obligations under the Placing and Open Offer
Agreement in respect of the Non-EIS/VCT Placing Shares are
conditional on, inter alia:
i. all the conditions in the Placing and Open Offer Agreement
relating to the placing of the VCT Placing Shares having been
fulfilled (or, where applicable, waived);
ii. the Non-EIS/VCT Placing Shares having been unconditionally
allotted and issued by the Company before 8.00 a.m. on the Expected
Admission Date;
iii. Admission taking place not later than 8.00 a.m. on the
Expected Admission Date (or such later date as Shore Capital may
agree as the date for Admission but in any event not later than
8.00 am on the Long Stop Date);
iv. the Company having confirmed to Shore Capital that, prior to
the delivery of such confirmation, none of the warranties of the
Company contained in the Placing and Open Offer Agreement was
untrue, inaccurate or misleading on and as at the date of the
Placing and Open Offer Agreement or will be untrue, inaccurate or
misleading immediately prior to Admission when repeated at that
time, by reference to the facts and circumstances then subsisting;
and
v. the Company having complied with or performed its obligations
under the Placing and Open Offer Agreement to the extent that the
same fall to be performed prior to Admission.
Application will be made for the Placing Shares to be admitted
to trading on AIM subject, inter alia, to the passing of
Resolutions 1 and 2 at the General Meeting. It is expected that
Admission will become effective and that dealings in the Placing
Shares will commence at 8.00 a.m. on 23 November 2021.
The Placing Shares will, when issued and fully paid, rank pari
passu in all respects with the Existing Ordinary Shares, the
Subscription Shares, the Open Offer Shares and the Consideration
Shares, including the right to receive all dividends and other
distributions declared, made or paid after the date of Admission.
The Placing Shares are not subject to clawback and are not part of
the Open Offer.
The allotment and issue of the Open Offer Shares is conditional
on Admission of the Placing Shares, but the Placing is not
conditional on Admission of the Open Offer Shares; if the Placing
does not complete, then the Open Offer will also not complete.
However, if the Open Offer does not complete, then this will not
prevent the Placing from completing.
The Company is raising GBP335,000 at the Issue Price from
certain of the Directors (being Richard Rose and Karen Bach and/or
their connected persons) by way of the Placing.
Subscription
The Subscription comprises the issue of the Subscription Shares
by the Company at the Issue Price, representing approximately 0.1
per cent. of the Enlarged Share Capital. It is anticipated that the
Subscription will raise approximately GBP0.225 million for the
Company, before expenses. The Subscription is conditional, inter
alia, on Admission becoming effective by no later than 8.00 a.m. on
23 November 2021 or such later date (being no later than 30
November 2021) as the Company and Shore Capital may agree.
The Subscription Shares will be issued credited as fully paid
and will, on issue, rank pari passu with the Existing Ordinary
Shares, the Placing Shares and the Open Offer Shares in all
respects including, without limitation, in relation to any
dividends and other distributions declared, paid or made following
Admission. The Subscription Shares will be issued free from all
liens, charges and encumbrances. It is expected that certificates
in respect of Subscription Shares will be despatched by post within
fourteen days of the date of Admission.
The Company is raising GBP150,000 at the Issue Price from
certain of the Directors (being Richard Harpham and Graham Bird) by
way of the Subscription.
Open Offer
Subject to the fulfilment of the conditions set out below,
Qualifying Shareholders may subscribe for Open Offer Shares in
proportion to their holding of Existing Ordinary Shares held on the
Record Date.
Qualifying Shareholders subscribing for their full entitlement
under the Open Offer may also request additional Open Offer Shares
as an Excess Entitlement, up to the total number of Open Offer
Shares available to Qualifying Shareholders under the Open Offer.
The Open Offer is not underwritten.
The Open Offer is conditional, inter alia, on the following:
i. Resolutions 1 and 2 being passed at the General Meeting;
ii. the Placing and Open Offer Agreement not being terminated
prior to Admission of the Placing Shares and having become
unconditional in all respects; and
iii. Admission of the Open Offer Shares becoming effective on or
before 8.00 a.m. on 23 November 2021 (or such later date and/or
time as the Company and Shore Capital may agree, being no later
than 30 November 2021).
The allotment and issue of the Open Offer Shares is conditional
on Admission of the Placing Shares, but the Placing is not
conditional on Admission of the Open Offer Shares; if the Placing
does not complete, then the Open Offer will also not complete.
However, if the Open Offer does not complete, then this will not
prevent the Placing from completing.
If these and the other conditions to the Open Offer are not
satisfied or waived (where capable of waiver), the Open Offer will
lapse and will not proceed and any applications made by Qualifying
Shareholders will be rejected. In these circumstances, application
monies received by the Receiving Agent in respect of Open Offer
Shares will be returned (at the applicant's sole risk), without
payment of interest, as soon as reasonably practicable thereafter.
Lapsing of the Open Offer cannot occur after dealings in the Open
Offer Shares have begun.
Application will be made for the Open Offer Shares to be
admitted to trading on AIM subject, inter alia, to the passing of
the Resolutions at the General Meeting. It is expected that
Admission will become effective and that dealings in the Open Offer
Shares will commence at 8.00 a.m. on 23 November 2021.
The Open Offer Shares will, when issued and fully paid, rank
pari passu in all respects with the Existing Ordinary Shares,
including the right to receive all dividends and other
distributions declared, made or paid after the date of Admission of
the Open Offer Shares. The Open Offer is not being
underwritten.
Qualifying Shareholders should note that the Open Offer is not a
"rights issue". Invitations to apply under the Open Offer are not
transferable unless to satisfy bona fide market claims. Qualifying
non-CREST Shareholders should be aware that the Application Form is
not a negotiable document and cannot be traded. Qualifying
Shareholders should also be aware that in the Open Offer, unlike in
a rights issue, any Open Offer Shares not applied for will not be
sold in the market nor will they be placed for the benefit of
Qualifying Shareholders who do not apply for Open Offer Shares
under the Open Offer.
Basic Entitlement
On, and subject to the terms and conditions of the Open Offer,
the Company invites Qualifying Shareholders to apply for their
Basic Entitlement of Open Offer Shares at the Issue Price. Each
Qualifying Shareholder's Basic Entitlement has been calculated on
the following basis:
1 Open Offer Share for every 12 Existing Ordinary Shares
held at the Record Date.
Basic Entitlements will be rounded down to the nearest whole
number of Ordinary Shares.
Excess Entitlement
Qualifying Shareholders are also invited to apply for additional
Open Offer Shares (up to the total number of Open Offer Shares
available to Qualifying Shareholders under the Open Offer) as an
Excess Entitlement. Any Open Offer Shares not issued to a
Qualifying Shareholder pursuant to their Basic Entitlement will be
apportioned between those Qualifying Shareholders who have applied
for an Excess Entitlement at the sole and absolute discretion of
the Board, provided that no Qualifying Shareholder shall be
required to subscribe for more Open Offer Shares than he or she has
specified on the Application Form or through CREST.
Overseas Shareholders
The Open Offer Shares have not been and are not intended to be
registered or qualified for sale in any jurisdiction other than the
United Kingdom. Accordingly, unless otherwise determined by the
Company and effected by the Company in a lawful manner, the
Application Form will not be sent to Shareholders with registered
addresses in, or who are resident or located in the United States
or any other Open Offer Restricted Jurisdiction since to do so may
require compliance with the relevant securities laws of that
jurisdiction. The Company reserves the right to treat as invalid
any application or purported application for Open Offer Shares
which appears to the Company or its agents or professional advisers
to have been executed, effected or despatched in a manner which may
involve a breach of the laws or regulations of any jurisdiction or
if the Company or its agents or professional advisers believe that
the same may violate applicable legal or regulatory requirements or
if it provides an address for delivery of share certificates for
Open Offer Shares outside the UK, or in the case of a credit of
Open Offer Shares in CREST, to a CREST member whose registered
address would not be in the UK.
Notwithstanding the foregoing and any other provision of this
Announcement or the Application Form, the Company reserves the
right to permit any Qualifying Shareholder to apply for Open Offer
Shares if the Company, in its sole and absolute discretion, is
satisfied that the transaction in question is exempt from, or not
subject to, the legislation or regulations giving rise to the
restrictions in question.
The Circular, together with the accompanying Application Form,
in the case of Qualifying non-CREST Shareholders, will contain the
terms and conditions of the Open Offer. If a Qualifying Shareholder
does not wish to apply for Open Offer Shares he or she should not
complete or return the Application Form or send a USE message
through CREST.
8. EIS/VCT
The following information is based upon the laws and practice
currently in force in the UK and may not apply to persons who do
not hold Ordinary Shares as investments.
The Company has received preliminary assurance from HMRC that
the Ordinary Shares are capable of qualifying for EIS tax reliefs.
Accordingly, the EIS Placing Shares will rank as "eligible shares"
and will be capable of being a "qualifying holding" and that the
Company can issue EIS3 "compliance certificates" for the purposes
of EIS, subject to the successful submission of an EIS1 compliance
statement to HMRC.
Shareholders and investors who are in any doubt as to their tax
position or who are subject to tax in jurisdictions other than the
UK are strongly advised to consult their own independent financial
adviser.
The information below is intended only as a general guide to the
current tax position under UK taxation law and is not intended to
be exhaustive.
EIS
The Company intends to operate so that it qualifies for the
taxation advantages offered under EIS.
The main advantages are as follows:
-- Individuals can claim a tax credit reduction of 30 per cent.
of the amount invested in the Company against their UK income tax
liability, provided they have a sufficient tax liability to reclaim
this amount, thus reducing the effective cost of their investment
to 70 pence for each GBP1 invested. However, there is an EIS
subscription limit of GBP1 million in each tax year, or GBP2
million in each tax year providing at least the excess over GBP1
million is invested into shares in a company which qualifies as a
knowledge intensive company, and, to retain the relief, the EIS
Placing Shares must be held for at least three years.
-- UK investors (individuals or certain trustees) may defer a
chargeable gain by investing the amount of the gain in the Company.
There is no limit to the level of investment for this purpose and,
therefore, to the amount of gain which may be deferred in this way.
Note that the deferred gain will come back into charge when the EIS
Placing Shares are disposed of or if the Company ceases to qualify
as an EIS company within the three year qualifying period.
-- There is no tax on capital gains made upon disposal after the
three year period (the " Qualifying Period ") of shares in an EIS
qualifying company on which income tax relief has been given and
not withdrawn.
-- If a loss is made on disposal of the EIS Placing Shares at
any time, the amount of the loss (after allowing for any income tax
relief retained) can be set off against either the individual's
gains for the tax year in which the disposal occurs, or, if not so
used, against capital gains of a subsequent tax year, or against
the individual's net income of the tax year of the disposal or of
the previous tax year.
-- Provided a Shareholder has owned EIS Placing Shares for at
least two years and certain conditions are met at the time of
transfer, up to 100 per cent. business property relief will be
available, which reduces the inheritance tax liability on the
transfer of EIS Placing Shares to nil.
-- The amount of relief an investor may gain from an EIS
investment in the Company will depend on the investor's individual
circumstances.
Qualifying Period
In order to retain the EIS reliefs, an investor must hold their
shares for at least three years. A sale or other disposal (other
than an inter-spousal gift or a transfer on death) will result in
any income tax relief that has been claimed being clawed back by
HMRC. Additionally, any capital gains deferred will come back into
charge and the capital gains tax exemption will be lost. It is the
investor's responsibility to disclose a disposal to HMRC.
An individual can only be eligible for EIS relief on the
subscription of shares if all shares held by that investor are
shares which have been or will be eligible for EIS relief or the
original subscriber shares which the investor has continued to
hold.
Additionally, if the Company ceases to meet certain qualifying
conditions within three years from the date of the share issue, the
tax reliefs will be lost. This will be shown as the "Termination
Date" on the EIS3 compliance certificate which the Company will
issue to investors following formal approval of the share issue by
HMRC.
Advance Assurance of EIS Status
In order for investors to claim EIS reliefs relating to their
shares in the Company, the Company has to meet a number of rules
regarding the kind of company it is, the amount of money it can
raise, how and when that money must be employed for the purposes of
the trade, and the trading activities carried on. The Company must
satisfy HMRC that it meets these requirements and is therefore a
qualifying company.
Although the Company currently expects to satisfy the relevant
conditions for EIS investment, neither the Company nor the
Directors give any warranty or undertaking that relief will be
available in respect of any investment in the EIS Placing Shares or
that the Company will continue to satisfy the conditions for EIS
investment.
VCT
The status of the Ordinary Shares as a qualifying holding for
VCT purposes will be conditional, inter alia, on the Company
continuing to satisfy the relevant requirements and on the Ordinary
Shares being held as a "qualifying holding" for VCT purposes
throughout the period of ownership.
Neither the Company nor the Directors give any warranty,
representation or undertaking that any VCT investment in the
Company will remain a qualifying holding nor have they obtained any
advance assurance from HM Revenue and Customs prior to the date of
this announcement. The Company cannot guarantee or undertake to
conduct its business following Admission, in a way to ensure that
the Company will continue to meet the requirements of a VCT Scheme.
VCTs considering making a qualifying VCT investment are recommended
to seek their own professional advice in order that they may fully
understand how the relief legislation may apply in their individual
circumstances.
The status of the VCT Placing Shares as a qualifying holding for
VCTs will be conditional, inter alia, upon the Company continuing
to satisfy the relevant requirements.
Although the Company currently expects to satisfy the relevant
conditions for VCT investment, neither the Company nor the
Directors give any warranty or undertaking to any Shareholder that
an investment in the VCT Placing Shares by a VCT will be a
qualifying holding.
Structure of the EIS Placing and the VCT Placing
New Ordinary Shares will be allotted and issued in certificated
form to the EIS Placees at 11.59 p.m. on 22 November 2021. New
Ordinary Shares will be allotted and issued in certificated form to
the VCT Placees at 7.30 a.m. on 23 November 2021. New Ordinary
Shares will be delivered into the CREST accounts for all other
Placees of the Non-EIS/VCT Placing Shares as soon as possible after
8.00 a.m. on 23 November 2021. As soon as possible after 8.00 a.m.
on 23 November 2021, the EIS and VCT Placing Shares will be
dematerialised into CREST. The subscription for Placing Shares by
the EIS Placees and the VCT Placees is not conditional on
Admission.
As the rules governing EIS and VCT reliefs are complex and
interrelated with other legislation, if Shareholders and investors
are in any doubt as to their tax position, require more detailed
information than the general outline above, or are subject to tax
in a jurisdiction other than the United Kingdom, they should
consult their professional adviser.
9. USE OF NET PROCEEDS
The net proceeds of the Fundraising are expected to be
approximately GBP16.08 million (on the basis the Open Offer is
fully subscribed) and will be used to pay for the cash element of
the consideration payable for the Acquisition, for operational
improvements/integration of Boom Battle Bars, for new Escape Hunt
and Boom Battle Bars sites, to fund the costs and expenses of the
Proposals and for general working capital purposes.
10. SETTLEMENT AND DEALINGS
The Placing Shares, the Subscription Shares and the Open Offer
Shares will be issued credited as fully paid and will rank pari
passu with the Existing Ordinary Shares, including the right to
receive all dividends and other distributions declared, made or
paid, if any, in respect of Ordinary Shares after their issue.
Application will be made to the London Stock Exchange for the
New Ordinary Shares to be admitted to trading on AIM. Subject to
the passing of Resolutions 1 and 2 at the General Meeting, it is
expected that Admission will become effective and that dealings in
the Placing Shares, the Subscription Shares and the Open Offer
Shares will commence at 8.00 a.m. on 23 November 2021.
Settlement of the Placing will, at the option of Placees, be
within CREST. New Ordinary Shares in respect of the Placing will be
allotted and issued in certificated form to:
a. the EIS Placees at 11.59 p.m. on 22 November 2021; and
b. the VCT Placees at 7.30 a.m. on 23 November 2021.
New Ordinary Shares in respect of the Placing will be delivered
into the CREST accounts for all other Placees (excluding the EIS
and VCT Placing Shares) as soon as possible after 8.00 a.m. on 23
November 2021.
As soon as possible after 8.00 a.m. on 23 November 2021, the EIS
and VCT Placing Shares will be dematerialised into CREST.
No temporary documents of title will be issued. Definitive share
certificates for Placees not settling through CREST will be
despatched by the Registrar within 10 Business Days of the date of
Admission. Prior to the despatch of such certificates, transfers
will be certified against the register of members of the Company
held by the Registrar.
11. SENIOR MANAGEMENT ADDITIONS
Senior Management
On Admission, it is proposed that the following individuals will
join the Enlarged Group as members of its senior management team
with responsibility for Boom Battle Bars:
David "Elliott" Shuttleworth, MD, Boom Battle Bars (Aged 31)
Elliott is a co-founder of Boom Battle Bars and responsible for
all aspects of the business. His flair for creativity and passion
for Boom Battle Bars to be the UK's number one competitive
socialising concept is felt throughout the business. Elliott's
innovation has helped create an incredible product and a strong
team.
Joanne "Jo" Briscoe, Boom Battle Bars In-House Legal Counsel,
(Aged 47)
Jo is an accomplished property lawyer with over 18 years'
experience, Jo, whose expertise is in property, franchising,
commercial property and property corporate work, works across the
Boom Battle Bars portfolio and commercial contracts.
12. INCENTIVISATION ARRANGEMENTS
In order to align the interests of Shareholders and employees of
the Enlarged Group following Admission, the Company is proposing to
make changes to the existing Executive Growth Share Plan by setting
new vesting conditions and making new awards. The EGSP was
established in May 2017 but there are currently no beneficiaries as
the original vesting conditions were not met by anyone.
Under the proposed changes, beneficiaries of the EGSP will be
entitled to share in the equity value created within the Enlarged
Group (such share in the equity value being the "Management
Share"). The underlying principle of the plan is that the
Management Share will be determined as being 7.5 per cent. of the
value created from a starting point of 1.75x the Issue Price pence
per share. The share price will need to exceed 2x the Issue Price
pence per share before any value accrues to the Management Share
and the total payout will be restricted to 5 per cent. of the
enlarged issued share capital of the Company as at the date of the
payout. The benefit will be received in the form of new shares to
be issued by the Company, or (at the Company's option) in cash.
The Company intends to amend the articles of association of the
subsidiary company which encompasses the EGSP scheme and to issue
invitations pursuant to the EGSP on or shortly after Admission to
certain members of the Enlarged Group's senior executive team.
Further to such invitation, each relevant individual may (at their
own election) acquire from the Company the number of G Shares
specified in the invitation. Invitations will only be made in
respect of the acquisition of the 1000 G Shares currently held by
the Company.
13. LOCK-INS AND ORDERLY MARKET PROVISIONS
The Seller has entered into a Lock-in Agreement with the
Company, KK Advisory and Shore Capital, pursuant to which terms the
Seller has undertaken to the Company and Shore Capital that, save
in specified circumstances, it will not, without the prior consent
of Shore Capital, dispose of any interest in Ordinary Shares held
by it until 15 July 2023 (" Lock-in Period "). The specified
circumstances include:
a) any disposal pursuant to any offer made for the share capital
of the Company (or any part of it) by an offeror that would result
in the offeror obtaining or consolidating control (as defined in
the City Code on Takeovers and Mergers) of the Company or the
execution of an irrevocable commitment to accept such an offer or a
sale to an offeror or potential offeror which is named in a public
announcement of a firm or, as the case may be, possible intention
to make such an offer; or
b) any disposal pursuant to an intervening court order;
c) pursuant to disposals under any scheme or reconstruction
under section 110 of the Insolvency Act 1986 or any compromise or
arrangement or any takeover effected under part 26 of the Companies
Act;
d) pursuant to an offer by the Company to purchase its own
shares which is made in identical terms to all shareholders;
e) any disposal to the trustees of a trust of the Seller,
provided that the transferee of the Ordinary Shares agrees to be
bound by the provisions of the Lock-in Agreement; or
f) a transfer to an Associate (within the meaning of paragraph
(c) in the definition of "related party" in the AIM Rules), subject
to such Associate having first entered into a deed of adherence to
be bound by the terms of the Lock-in Agreement; or any disposal to
the Company to meet certain potential liabilities under the
Acquisition Agreement
Furthermore, the Seller has also undertaken to the Company, KK
Advisory and Shore Capital not to dispose of its Ordinary Shares
for a period of 12 months from the expiry of the Lock-in Period
otherwise than through the Company's broker or KK Advisory (or a
broker approved by KK Advisory for this purpose) and in any case
with the consent of the Company's broker in order to maintain an
orderly market in the Ordinary Shares.
14. PROPOSED CHANGE OF NAME
The Resolutions include a resolution to change the name of the
Company to XP Factory Plc to reflect the changing nature of the
Enlarged Group's business. Upon the change of name being registered
at Companies House, which is expected to occur around within three
weeks following Admission, the Company's AIM ticker symbol will be
changed to XPF and its website address will be changed to
www.xpfactory.com.
15. PROPOSED AMMENTS TO THE ARTICLES
The Articles currently contain a cap on the Company's borrowing
powers. The Board considers that the inclusion of such a provision
in the Articles is no longer necessary or appropriate and therefore
the Resolutions include a proposed amendment to the Articles to
remove the cap on borrowing powers of two times "Adjusted Capital
and Reserves" (as such term is defined in the current Article
102.3).
Further, the Board considers that, should the Company ever wish
to hold general meetings by way of an electronic platform, it would
be beneficial to set out the procedure in the Articles.
Finally, the Board considers that there are a few provisions in
the Articles that are superfluous to a company whose shares are
admitted to trading on AIM which are therefore proposed to be
deleted (being provisions that are more appropriate to a company
whose shares are listed on the Main Market of the London Stock
Exchange).
16. TAXATION
Your attention is drawn to the information regarding taxation
which will be set out in the Circular. That information is intended
only as a general guide to the current tax position under UK
taxation law. If you are in any doubt as to your tax position, you
should contact your independent professional adviser.
17. GENERAL MEETING
Set out at the end of the Circular will be the Notice of General
Meeting convening the General Meeting to be held at the offices of
Shore Capital at Cassini House, 57 St James's Street, London SW1
1LD at 10.00 a.m. on 22 November 2021. The full terms of the
Resolutions are set out in that notice and are summarised
below:
Resolution 1: the Company does not currently have sufficient
authority to allot shares to effect the Placing, the Subscription
or the Open Offer or to issue the Consideration Shares.
Accordingly, Resolution 1 (which is conditional upon the passing of
Resolution 2) is an ordinary resolution to ensure that the
Directors have sufficient authority under section 551 of the 2006
Act to issue such shares. This authority will expire at the earlier
of the Company's next annual general meeting and 1 February
2023.
Resolution 2: is a special resolution (conditional upon the
passing of Resolution 1), to empower the Directors, pursuant to
section 570 of the 2006 Act, to allot New Ordinary Shares up to a
maximum aggregate nominal amount of GBP1,029,812.59 on a
non-pre-emptive basis to effect the Placing and the Open Offer and
to issue the Consideration Shares . This authority will expire at
the earlier of the Company's next annual general meeting and 1
February 2023.
If Resolution 2 is passed, the Directors will have the power,
under the 2006 Act, to allot such New Ordinary Shares without
offering those shares to existing Shareholders.
Resolution 3 : is a special resolution to change the name of the
Company to XP Factory Plc . It is conditional upon the passing of
Resolutions 1 and 2.
Resolution 4: is a special resolution to amend the Company's
articles of association in the manner set out within the
resolution, conditional upon the passing of Resolutions 1 and
2.
18. ACTION TO BE TAKEN
The Company continues to monitor developments relating to the
outbreak of Covid-19, including the related public health guidance
and legislation issued by the UK Government. At present, it is
expected that it will be possible to hold a physical General
Meeting and to welcome the maximum number of Shareholders the
Company is able to, within safety constraints and in accordance
with Government guidelines that will apply at the time.
However, given the constantly evolving nature of the situation,
the Company wants to ensure that it is able to adapt these
arrangements efficiently to respond to changes in circumstances. On
this basis, should the situation change such that it considers that
it is no longer possible for Shareholders to attend the meeting,
the Company will adopt contingency plans and notify Shareholders of
the change by way of an announcement on an RIS as early as is
possible before the date of the meeting. Any updates to the
position will also be included on the Company's website at
www.escapehunt.com/investors/. Should the Company have to change
the arrangements in this way, it is likely that it will not be in a
position to accommodate Shareholders beyond the minimum required to
hold a quorate meeting which will be achieved through the
attendance of employee shareholders.
Shareholders wishing to attend the meeting in person or wishing
to appoint a proxy or corporate representative other than the Chair
of the meeting are asked to register their proposed attendance as
soon as practicable by emailing the Company Secretary at
graham.bird@escapehunt.com. Rules around capacity at the venue and
changes in health and safety requirements may mean that
Shareholders cannot ultimately attend the meeting.
Given the uncertainty as to whether Shareholders will be able to
attend the General Meeting, the Board recommends that all
Shareholders appoint the Chair of the General Meeting as their
proxy. This will ensure that your vote is counted even if
attendance at the meeting is restricted or you or any other proxy
you might appoint are unable to attend in person.
You will find accompanying the Circular a Form of Proxy for use
in connection with the General Meeting. You are asked to complete
the Form of Proxy in accordance with the instructions printed on it
so as to be received by the Company's registrars, Equiniti Limited,
as soon as possible but in any event not later than 10.00 a.m. on
18 November 2021.
The return of a completed Form of Proxy will not prevent a
member attending the General Meeting and voting in person if the
member wishes to do so and attending the General Meeting in person
is currently permitted under prevailing UK legislation.
CREST members who wish to appoint a proxy or proxies through the
CREST electronic proxy appointment service may do so by using the
procedures described in the CREST Manual. CREST Personal Members or
other CREST sponsored members, and those CREST members who have
appointed (a) voting service provider(s), should refer to their
CREST sponsor or voting service provider(s), who will be able to
take the appropriate action on their behalf
19. FURTHER INFORMATION
Your attention is also drawn to the remaining parts of this
announcement, which contain further information on the
Proposals.
20. RECOMMATION
The Directors consider the Proposals to be fair and reasonable
and in the best interests of the Company and Shareholders as a
whole. Accordingly, the Directors unanimously recommend that
Shareholders vote in favour of the Resolutions, as they intend to
do in respect of their own direct and beneficial shareholdings,
amounting to, in aggregate, 3,679,528 Existing Ordinary Shares,
representing approximately 4.2 per cent. of the Existing Share
Capital.
EXPECTED TIMETABLE OF PRINCIPAL EVENTS
2021
Record Date for entitlements under the
Open Offer 6.00 p.m. on 2 November
Ex-entitlement Date for the Open Offer 8.00 a.m. on 4 November
Publication of the Circular, the Application
Form and Form of Proxy 4 November
Basic Entitlements and Excess Entitlements as soon as practicable
credited to stock accounts of Qualifying after 8.00 a.m. on 5
CREST Shareholders in CREST November
Recommended latest time and date for requesting
withdrawal of Basic Entitlements and Excess
Entitlements from CREST 4.30 p.m. on 15 November
Latest time and date for depositing Basic
Entitlements and Excess Entitlements into
CREST 3.00 p.m. on 16 November
Latest time and date for splitting Application
Forms (to satisfy bona fide market claims
only) 3.00 p.m. on 17 November
Latest time and date for receipt of completed
Forms of Proxy for the General Meeting 10.00 a.m. on 18 November
Latest time and date for receipt of completed
Application Forms and payment in full under
the Open Offer or settlement of relevant
CREST instructions (as appropriate) 11.00 a.m. on 19 November
Announcement of result of Open Offer by 7.00 a.m. on 22 November
General Meeting 10.00 a.m. on 22 November
Announcement of result of General Meeting 22 November
Allotment and issue of EIS Placing Shares 11.59 p.m. on 22 November
Allotment and issue of VCT Placing Shares 7.30 a.m. on 23 November
Admission effective, commencement of dealings
in the Placing Shares, the Subscription
Shares and the Open Offer Shares on AIM
and completion of the Acquisition 8.00 a.m. on 23 November
CREST stock accounts credited for Placing
Shares and Open Offer Shares in uncertificated
form (excluding the VCT Placing Shares) 8.00 a.m. on 23 November
Despatch of definitive certificates for
the Placing Shares, the Subscription Shares
and the Open Offer Shares in certificated
form week commencing 6 December
Notes:
1) The ability to participate in the Open Offer is subject to
certain restrictions relating to Qualifying Shareholders with
registered addresses or located or resident in countries outside
the UK (particularly the Restricted Jurisdictions), details of
which will be set out in the Circular. Subject to certain
exceptions, Application Forms will not be despatched, and Basic
Entitlements and Excess Entitlements will not be credited, to the
stock accounts in CREST of Shareholders with registered addresses
in any of the Restricted Jurisdictions.
2) Each of the times and dates set out in the above timetable
and mentioned in this announcement is subject to change by the
Company, in which event details of the new times and dates will be
notified by an announcement through a Regulatory Information
Service.
3) References to times in this announcement are to London times unless otherwise stated.
ISSUE STATISTICS
Number of Existing Ordinary Shares 88,620,091
Maximum number of Consideration Shares being
issued by the Company pursuant to the Acquisition 25,000,000
Number of Placing Shares being issued by the
Company pursuant to the Placing 49,250,000
Number of Subscription Shares being issued
by the Company pursuant to the Subscription 750,000
Maximum number of Open Offer Shares available
to Qualifying Shareholders pursuant to the
Open Offer 7,385,007
1 Open Offer Share
for every 12 Existing
Basis of Open Offer Ordinary Shares
10 day average closing middle market price
per Ordinary Share to 2 November 2021 34.6 pence
Issue Price 30 pence
Discount to the 10 day average closing middle approximately 13 per
market price per Ordinary Share cent.
Enlarged Share Capital, being the number of
Ordinary Shares in issue immediately following
Admission* aggregated with the maximum number
of Consideration Shares 171,005,088
Aggregate number of New Ordinary Shares* (including
the maximum number of Consideration Shares
that may be issued) 82,385,007
Percentage of the Enlarged Share Capital represented
by the New Ordinary Shares* 48 per cent.
Gross proceeds of the Placing Shares GBP14.775 million
Gross proceeds of the Subscription GBP0.225 million
Gross proceeds of the Fundraising* receivable
by the Company GBP17.20 million
Estimated net proceeds of the Fundraising*
receivable by the Company GBP16.08 million
Market capitalisation of the Company on Admission
at the Issue Price* GBP43.8 million
Basic Entitlement ISIN GB00BMDV1220
Excess Entitlement ISIN GB00BMDV1337
EPIC/TDIM ESC
ISIN GB00BDB79J29
SEDOL BDB79J2
LEI number 213800CMIYV5Q38P2487
* Assuming the maximum number of Open Offer Shares are issued
pursuant to the Open Offer on Admission.
DEFINITIONS
The following definitions apply throughout this announcement,
unless the context otherwise requires:
"2006 Act" the Companies Act 2006, as amended
"Acquisition" the proposed acquisition by Escape Hunt of
the Boom Battle Bars Group on the terms of
the Acquisition Agreement
"Acquisition Agreement" the conditional agreement between (1) the
Seller (2) Richard Beese (3) David White and
(4) the Company dated 3 November 2021 relating
to the Acquisition details of which are set
out in this announcement
"Admission" the admission of the Placing Shares, the Subscription
Shares and the Open Offer Shares to trading
on AIM becoming effective in accordance with
the AIM Rules
"Admission Date" the date on which Admission becomes effective
"AIM" a market of the London Stock Exchange plc
known as AIM
"AIM Rules" the AIM Rules for Companies published by the
London Stock Exchange, as amended from time
to time
"Announcement this announcement, including the Appendix
and the terms and conditions set out herein
"Appendix" has the meaning given in the "Details of the
Fundraising" section of this Announcement;
"Application Form" the application form relating to the Open
Offer to be enclosed with the Circular for
use by Qualifying non-CREST Shareholders
"Articles" the articles of association of the Company
"Basic Entitlement(s)" the pro rata entitlement for Qualifying Shareholders
to subscribe for Open Offer Shares, pursuant
to the Open Offer as described in this announcement
"Board" the board of directors of the Company at any
time
"Bookbuild" the bookbuild process to be conducted by Shore
Capital Stockbrokers to be launched immediately
following the release of this announcement
by which Shore Capital Stockbrokers will determine
demand for participation in the Placing by
the Placees
"Boom Battle Bars" the business of Boom Battle Bars, as operated
by the Boom Battle Bars Group as at the date
of this announcement
"Boom Battle Bars BBB Franchise Limited, BBB UK Trading Limited
Group" and BBB Ventures Limited and BBB Ventures
Limited's Subsidiaries as at the date of this
Announcement
"Business Day" a day (other than a Saturday, Sunday or public
holiday) when banks are usually open for business
in London
"certificated" or in relation to a share or other security,
"in certificated a share or other security that is not in uncertificated
form" form, that is not in CREST
"Circular" the circular of the Company giving (amongst
other things) details of the Proposals and
incorporating the Notice of General Meeting,
which is to be posted on or around 4 November
2021
"Company" or "Escape Escape Hunt Plc, a company incorporated in
Hunt" England and Wales with registered number 10184316
"Completion" completion of the Acquisition Agreement in
accordance with its terms on Admission
"Consideration Shares" up to 25,000,000 New Ordinary Shares to be
issued fully paid to the Seller and as consideration
for the Acquisition
"CREST" the relevant system (as defined in the Regulations)
in respect of which Euroclear UK & Ireland
Limited is the operator (as defined in the
Regulations)
"CREST Manual" the rules governing the operation of CREST,
as published by Euroclear
"CREST member" a person who has been admitted by Euroclear
as a system-member (as defined in the Regulations)
"CREST payment" shall have the meaning given in the CREST
Manual issued by Euroclear
"CREST Regulations" the Uncertificated Securities Regulations
2001
"CREST sponsor" a CREST participant admitted to CREST as a
CREST sponsor
"CREST sponsored a CREST member admitted to CREST as a sponsored
member" member (which includes all CREST Personal
Members)
"Directors" the board of directors of the Company
"EEA" European Economic Area
"EEA Qualified Investor" persons falling within the meaning of Article
2(e) of Regulation (EU) 2017/1129
"EIS" Enterprise Investment Scheme
"EIS and VCT Placing together, the EIS Placing Shares and the VCT
Shares" Placing Shares
"EIS Placees" the subscribers for the EIS Placing Shares
pursuant to the EIS Placing
"EIS Placing" the proposed placing and issue of the EIS
Placing Shares with EIS Placees at the Issue
Price pursuant to the Placing
"EIS Placing Shares" those Placing Shares which are to be issued
to EIS Placees as part of the EIS Placing
"Enlarged Group" the Existing Group as enlarged by the Acquisition
"Enlarged Share Capital" the issued share capital of the Company following
the issue of the maximum number of Consideration
Shares, the Placing Shares, the Subscription
Shares and the Open Offer Shares
"EU Prospectus Regulation" the Regulation (EU) No 2017/1129 of the European
Parliament and of the Council of 14 June 2017
on the prospectus to be published when securities
are offered to the public or admitted to trading
on a regulated market, and repealing Directive
2003/ 71/EC
"Euroclear" Euroclear UK & Ireland Limited, the operator
of CREST
"Executive Growth the executive growth share plan, being an
Share Plan" or "EGSP" incentive scheme established by the Company
in May 2017
"Excess Application the arrangement pursuant to which Qualifying
Facility" Shareholders may apply for additional Open
Offer Shares in excess of the Basic Entitlement
in accordance with the terms and conditions
of the Open Offer
"Excess Entitlement(s)" Open Offer Shares in excess of the Basic Entitlement,
but not in excess of the total number of Open
Offer Shares, allocated to a Qualifying Shareholder
pursuant to the Open Offer as described in
the Circular
"Excess Shares" the Open Offer Shares for which Qualifying
Shareholders may apply under the Excess Application
Facility in addition to their Basic Entitlement
"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 4 November 2021
"Exchange Information" the business and financial information the
Company is required to publish in accordance
with MAR, the AIM Rules and other applicable
laws and regulations
"Existing Group" Escape Hunt plc, and its Subsidiaries, as
at the date of this Announcement
"Existing Ordinary the 88,620,091 Ordinary Shares in issue at
Shares" the date of this Announcement
" Existing Share the issued ordinary share capital of the Company
Capital" as at the date of this Announcement being
the Existing Ordinary Shares
"Expected Admission 23 November 2021 or such later date (being
Date" no later than 30 November 2021) as the Company
and Shore Capital may agree
"FCA" the United Kingdom Financial Conduct Authority
"Flip Out" the business of Flip Out, the UK's largest
trampoline operator by number of sites, with
an existing portfolio of 28 trampoline and
adventure parks
"Form of Confirmation" the form of confirmation or contract note
made between Shore Capital Stockbrokers and
a Placee which incorporates by reference the
terms and conditions of the Placing contained
in this Announcement
"Form of Proxy" the form of proxy for use by Shareholders
in connection with the General Meeting, which
will be enclosed with the Circular
"FSMA" Financial Services and Markets Act 2000 (as
amended)
"Fundraising" together, the Placing, the Subscription and
the Open Offer
"General Meeting" the general meeting of the Company to be convened
for 10.00 a.m. on 22 November 2021 at which
the Resolutions will be proposed, notice of
which will be set out at the end of the Circular
"Group" the Company and its Subsidiaries
"HMRC" Her Majesty's Revenue & Customs
"ISIN" International Securities Identification Number
"Issue Price" 30 pence per New Ordinary Share
"ITEPA" Income Tax (Earnings and Pensions) Act 2003
"KK Advisory" or KK Advisory Ltd, which is incorporated as
"KKA" a private limited company in England and Wales
with company number 11936988
"Lock in Agreements" the lock-in agreement between the Company,
Shore Capital, KK Advisory and the MFT Capital
"London Stock Exchange" London Stock Exchange Plc
"Long Stop Date" 30 November 2021
"MAR" the Market Abuse Regulation (596/2014/EU)
as implemented in the United Kingdom
"Member account ID" the identification code or number attached
to any member account in CREST
"Money Laundering the Anti-Terrorism, Crime and Security Act
Regulations" 2001, the Proceeds of Crime Act 2002 (as amended)
and the Money Laundering, Terrorist Financing
and Transfer of Funds (Information on the
Payer) Regulations 2017 (as amended)
"New Ordinary Shares" up to 82,385,007 new Ordinary Shares to be
issued pursuant to the Fundraising and Acquisition
(being the Consideration Shares, the Placing
Shares, the Subscription Shares and the Open
Offer Shares)
"Nominated Adviser" Shore Capital and Corporate Limited
"Non-EIS/VCT Placing Placing Shares which are not EIS Placing Shares
Shares" or VCT Placing Shares
"Notice of General the notice of General Meeting to be set out
Meeting" at the end of the Circular
"Open Offer" the conditional invitation to Qualifying Shareholders
to apply for the Open Offer Shares at the
Issue Price on the terms and conditions outlined
in the Circular and, where relevant, in the
Application Form
"Option Agreement" the agreement entered into between the Company
and the Seller granting the Company an exclusivity
period in relation to the acquisition, at
its option, of Flip Out
"Open Offer Entitlements" entitlements for Qualifying Shareholders
to subscribe for Open Offer Shares pursuant
to the Basic Entitlement and the Excess Entitlement
"Open Offer Restricted any jurisdiction other than the United Kingdom
Jurisdiction"
"Open Offer Shares" up to 7,385,007 New Ordinary Shares to be
issued pursuant to the Open Offer
"Ordinary Shares" ordinary shares of 1.25p each in the capital
of the Company, ISIN no. GB00BDB79J29
"Overseas Shareholders" Shareholders with registered addresses, or
who are citizens or residents of, or incorporated
in Restricted Jurisdictions
"Participant ID" the identification code or membership number
used in CREST to identify a particular CREST
member or other CREST participant
"Placees" any person who has agreed to subscribe for
Placing Shares
"Placing" the conditional placing by Shore Capital
of the Placing Shares at the Issue Price,
as described in this announcement
"Placing and Open the agreement dated 3 November 2021 between
Offer Agreement" the Company and Shore Capital, in connection
with the Fundraising, details of which are
set out in this announcement
"Placing Restricted the United States, Australia, Canada, Japan,
Jurisdiction" the Republic of Ireland, the Republic of
South Africa and any other jurisdiction where
the extension or availability of the Placing
would breach any applicable law
"Placing Shares" the 49,250,000 new Ordinary Shares to be
issued by the Company, pursuant to the Placing,
including the VCT Placing Shares and EIS
Placing Shares
"Proposals" together, the Acquisition, the Placing, the
Open Offer, the Subscription and other matters
as set out in the Notice of General Meeting
"Prospectus Regulation" the Regulation (EU) No 2017/1129 of the European
Parliament and of the Council of 14 June
2017 on the prospectus to be published when
securities are offered to the public or admitted
to trading on a regulated market, and repealing
Directive 2003/ 71/EC
"Prospectus Regulation the Prospectus Rules made under section 73A
Rules" of the Financial Services and Markets Act
2000 (as amended) in relation to offers of
securities to the public and admission of
securities to trading on a regulated market
"Qualifying CREST Qualifying Shareholders holding Existing
Shareholders" Ordinary Shares which, on the register of
members of the Company on the Record Date,
are in uncertificated form in CREST
"Qualifying non-CREST Qualifying Shareholders holding Existing
Shareholders" Ordinary Shares which, on the register of
members of the Company on the Record Date,
are in certificated form
"Qualifying Shareholders" holders of Existing Ordinary Shares other
than Shareholders with registered addresses,
or who are citizens or residents of, or incorporated
in an Open Offer Restricted Jurisdiction,
whose names appear on the register of members
of the Company on the Record Date as holders
of Existing Ordinary Shares and who are eligible
to be offered Open Offer Shares under the
Open Offer in accordance with the terms and
conditions set out in the Circular
"Receiving Agent" Equiniti Limited, the Company's receiving
agent
"Record Date" 6.00 p.m. on 2 November 2021
"Registrar" Equiniti Limited, the Company's registrar,
which is incorporated as a private limited
company in England and Wales with company
number 06226088
"Regulation D" Regulation D under the US Securities Act
"Regulation S" Regulation S under the US Securities Act
"Regulations" the Uncertificated Securities Regulations
2001 (SI 2001 No. 3755)
"Regulatory Information shall have the same meaning as in the AIM
Service" or "RIS" Rules
"Resolutions" the resolutions to be proposed at the General
Meeting and set out in the Notice of General
Meeting
"Restricted Jurisdictions" Open Offer Restricted Jurisdictions and Placing
Restricted Jurisdictions
"Securities Act" the United States Securities Act of 1933
"Seller" or "MFT MFT Capital Ltd, with company number 11618864
Capital"
"Shareholder" a holder of Ordinary Shares
"Shore Capital" Shore Capital and Corporate and/or Shore
Capital Stockbrokers as appropriate
"Shore Capital and Shore Capital and Corporate Limited, the
Corporate" Company's nominated adviser, which is incorporated
as a private limited company in England and
Wales with company number 02083043
"Shore Capital Stockbrokers" Shore Capital Stockbrokers Limited, joint
or "Broker" broker to the Company, which is incorporated
as a private limited company in England and
Wales with company number 01850105
"Subsidiary" has the meaning given to it in section 1159
of the 2006 Act
"Subscription" the proposed conditional subscription by
certain of the Directors of the Subscription
Shares at the Issue Price
"Subscription Shares" the 750,000 new Ordinary Shares to be issued
by the Company and subscribed for pursuant
to the Subscription, conditional on Admission
"uncertificated" a share or other security recorded on the
or "in uncertificated relevant register of the share or security
form" concerned as being held in uncertificated
form in CREST and title to which, by virtue
of the Regulations, may be transferred by
means of CREST
"UK Prospectus Regulation" The Prospectus Regulation, as it forms part
of UK law by virtue of the European Union
(Withdrawal) Act 2018, as amended from time
to time
"United Kingdom" the United Kingdom of Great Britain and Northern
or "UK" Ireland, its territories and possessions
"United States" or the United States of America, its territories
"US" and possessions, any state of the United
States and the District of Columbia
"USE" unmatched stock event
"VCT" a venture capital trust as defined in the
Income Tax Act 2007
"VCT Placees" the subscribers for the VCT Placing Shares
pursuant to the VCT Placing
"VCT Placing" the proposed placing and issue of the VCT
Placing Shares with VCT Placees at the Issue
Price pursuant to the Placing and Open Offer
Agreement
"VCT Placing Shares" those Placing Shares to be issued to VCTs
as part of the VCT Placing
"VCT Scheme" Venture Capital Trust Scheme under the provisions
of Part 6 of the Income Tax Act 2007
APPIX
TERMS AND CONDITIONS OF THE PLACING
IMPORTANT INFORMATION ON THE PLACING FOR INVITED PLACEES
ONLY.
MEMBERS OF THE PUBLIC ARE NOT ELIGIBLE TO TAKE PART IN THE
PLACING. THIS ANNOUNCEMENT (INCLUDING THIS APPIX) AND THE TERMS AND
CONDITIONS SET OUT HEREIN (TOGETHER, THIS "ANNOUNCEMENT") ARE FOR
INFORMATION PURPOSES ONLY AND 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: (A) IF IN A MEMBER STATE
OF THE EUROPEAN ECONOMIC AREA ("EEA"), PERSONS WHO ARE QUALIFIED
INVESTORS ("EEA QUALIFIED INVESTORS"), BEING PERSONS FALLING WITHIN
THE MEANING OF ARTICLE 2(e) OF REGULATION (EU) 2017/1129 (THE "EU
PROSPECTUS REGULATION"); OR (B) IF IN THE UNITED KINGDOM, PERSONS
WHO ARE QUALIFIED INVESTORS ("UK QUALIFIED INVESTORS"), BEING
PERSONS FALLING WITHIN THE MEANING OF ARTICLE 2(e) OF PROSPECTUS
REGULATION (EU) 2017/1129 AS IT FORMS PART OF DOMESTIC LAW BY
VIRTUE OF THE EUROPEAN UNION (WITHDRAWAL) ACT 2018 (THE "UK
PROSPECTUS REGULATION"), AND WHO ARE (I) PERSONS FALLING WITHIN THE
DEFINITION OF "INVESTMENT PROFESSIONAL" IN ARTICLE 19(5) OF THE
FINANCIAL SERVICES AND MARKETS ACT 2000 (FINANCIAL PROMOTION) ORDER
2005, AS AMED (THE "ORDER") OR (II) PERSONS WHO FALL WITHIN ARTICLE
49(2)(A) TO (D) (HIGH NET WORTH COMPANIES, UNINCORPORATED
ASSOCIATIONS, ETC) OF THE ORDER, OR (C) PERSONS TO WHOM IT MAY
OTHERWISE BE LAWFULLY COMMUNICATED (ALL SUCH PERSONS REFERRED TO IN
(A), (B) AND (C) TOGETHER BEING REFERRED TO AS "RELEVANT
PERSONS").
THIS ANNOUNCEMENT AND THE TERMS AND CONDITIONS SET OUT HEREIN
MUST NOT BE ACTED ON OR RELIED ON BY PERSONS WHO ARE NOT RELEVANT
PERSONS. PERSONS DISTRIBUTING THIS ANNOUNCEMENT MUST SATISFY
THEMSLEVES 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 THE SALE
OR SUBSCRIPTION OF ANY SECURITIES IN THE COMPANY.
THE PLACING SHARES HAVE NOT BEEN AND WILL NOT BE REGISTERED
UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMED (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 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. NO PUBLIC OFFERING OF
THE PLACING SHARES IS BEING MADE IN THE UNITED STATES OR
ELSEWHERE.
THIS ANNOUNCEMENT (INCLUDING THE APPIX) 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, CANADA, JAPAN, NEW
ZEALAND, THE REPUBLIC OF SOUTH AFRICA OR ANY OTHER JURISDICTION IN
WHICH SUCH RELEASE, PUBLICATION OR DISTRIBUTION WOULD BE
UNLAWFUL.
The distribution of this Announcement and/or the Placing and/or
issue of the Placing Shares in certain jurisdictions may be
restricted by law. No action has been taken by the Company, Shore
Capital or any of their respective affiliates, agents, directors,
officers or employees 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 Shore Capital to inform themselves
about and to observe any such restrictions.
Neither this Announcement nor any part of it constitutes or
forms 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 (including its territories and possessions, any state
of the United States and the District of Columbia), Australia,
Canada, Japan, New Zealand, the Republic of South Africa 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 will be made pursuant to an
exemption under the EU Prospectus Regulation and the UK Prospectus
Regulation from the requirement to produce a prospectus. In the
United Kingdom, this Announcement is being directed solely at
persons in circumstances in which section 21(1) of FSMA does not
apply.
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 for 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 Australia, Canada, Japan, New Zealand, the Republic of
South Africa. Accordingly, the Placing Shares may not (unless an
exemption under the relevant securities laws is applicable) be
offered, sold, resold or delivered, directly or indirectly, in or
into Australia, Canada, Japan, New Zealand, the Republic of South
Africa or any other jurisdiction outside the United Kingdom.
Persons (including, without limitation, nominees and trustees)
who have a contractual right or other legal obligation to forward a
copy of this Announcement should seek appropriate advice before
taking any action.
Each Placee should consult with its own advisers as to legal,
tax, business and related aspects of an acquisition of Placing
Shares. The price of shares and any income expected from them may
go down as well as up and Placees may not get back the full amount
invested upon disposal of the shares. Past performance is no guide
to future performance.
Placees, including any individuals, funds or others on whose
behalf a commitment to acquire Placing Shares is given, will be
deemed: (i) to have read and understood this Announcement,
including this Appendix, in its entirety; and (ii) to be
participating and making an offer for Placing Shares on the terms
and conditions and to be providing the representations, warranties,
acknowledgements and undertakings, contained in this Appendix.
Representations, warranties and acknowledgements of the
Placees
In particular, each such Placee represents, warrants and
acknowledges that:
1 in the case of a Relevant Person in the United Kingdom who
acquires any Placing Shares pursuant to the Placing:
(a) it is a UK Qualified Investor; and
(b) in the case of any Placing Shares acquired by it as a
financial intermediary, as that term is used in Regulation 5(1) of
the UK Prospectus Regulation:
(i) the Placing Shares acquired by it in the Placing 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 (a) to persons in
the United Kingdom other than UK Qualified Investors or (b) to
persons in any Relevant Member State other than EEA Qualified
Investors or (c) or in circumstances in which the prior consent of
Shore Capital has been given to each such proposed offer or
resale
(ii) where Placing Shares have been acquired by it on behalf of
persons in the United Kingdom other than UK 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; or
(iii) where Placing Shares have been acquired by it on behalf of
persons, other than EEA Qualified Investors, in any Relevant Member
State, the offer of those Placing Shares to it is not treated under
the EU Prospectus Regulation as having been made to such
persons;
2 in the case of a Relevant Person in a Relevant Member State
who acquires any Placing Shares pursuant to the Placing:
(a) it is an EEA Qualified Investor; and
(b) in the case of any Placing Shares acquired by it as a
financial intermediary, as that term is used in Regulation 5 of the
EU Prospectus Regulation:
(i) the Placing Shares acquired by it in the Placing 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 (a) to persons in
the United Kingdom other than UK Qualified Investors or (b) to
persons in any Relevant Member State other than EEA Qualified
Investors or (c) or in circumstances in which the prior consent of
Shore Capital has been given to each such proposed offer or resale;
or
(ii) where Placing Shares have been acquired by it on behalf of
persons in the United Kingdom other than UK 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; or
(iii) where Placing Shares have been acquired by it on behalf of
persons, other than EEA Qualified Investors, in any Relevant Member
State, the offer of those Placing Shares to it is not treated under
the EU Prospectus Regulation as having been made to such
persons;
3 it is acquiring the Placing Shares for its own account or is
acquiring the Placing Shares for an account with respect to which
it has authority to exercise, and is exercising, investment
discretion and has the authority to make and does make the
representations, warranties, indemnities, acknowledgements,
undertakings and agreements contained in this Announcement;
4 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;
5 except as otherwise permitted by the Company and subject to
any available exemptions from applicable securities laws, it (and
any person on whose account it is acting, as referred to in
paragraph 4 above) is located outside the United States and is
acquiring the Placing Shares in an "offshore transaction" as
defined in, and in accordance with, Regulation S;
6 if it acquires EIS Placing Shares or VCT Placing Shares
(together, the "EIS/VCT Placing Shares"), its obligations and
rights under the Placing in respect of such EIS/VCT Placing Shares
is conditional on the Placing and Open Offer Agreement having
become unconditional in respect of such Placing Shares but is not
conditional on Admission. It is anticipated that the EIS Placing
Shares will be issued unconditionally on or around 11:59 p.m. on
the day immediately prior to the Admission Date, the VCT Placing
Shares will be issued on or around 7:30 a.m. on the Admission Date,
and that the Placing Shares other than the EIS/VCT Placing Shares
will be issued prior to 8:00 a.m. on the Admission Date and that
Admission will occur and dealings in the Placing Shares (including
the EIS/VCT Placing Shares) will commence at 8.00 a.m. on the
Admission Date (or such later time and/or date as may be agreed by
Shore Capital and the Company, not being later than 8.00 a.m. on
the Long Stop Date). Placees acquiring EIS/VCT Placing Shares
should therefore be aware of the possibility that the EIS/VCT
Placing Shares might be issued and that none of the remaining
Placing Shares are issued, and such Placees should also be aware
that Admission might not take place. Consequently, even if the
EIS/VCT Placing Shares have been issued, there is no guarantee that
the placing of the remaining Placing Shares will become
unconditional or that Admission will occur.
Further details regarding the EIS Placing Shares and VCT Placing
Shares
Investors must take their own professional advice in order that
they may fully understand how the relief legislation may apply in
their individual circumstances and rely on it. In particular,
investors should note it is intended that, if the Placing and Open
Offer Agreement has not been terminated in accordance with its
terms before such time, the Company will unconditionally allot and
issue the EIS Placing Shares and VCT Placing Shares prior to the
anticipated time of Admission. Accordingly, the allotment and
issuance of the EIS Placing Shares and VCT Placing Shares is not
conditional on the allotment and issuance of the remaining Placing
Shares, nor on Admission occurring, nor on the completion of the
Acquisition Agreement. Further details in relation to the Placing
and Open Offer Agreement conditions are contained below.
.
Details of the Placing and Open Offer Agreement, the Placing
Shares and the Bookbuild
Shore Capital and Corporate is acting as nominated adviser and
Shore Capital Stockbrokers is acting as sole broker in connection
with the Fundraising and Admission. Shore Capital and Corporate and
Shore Capital Stockbrokers have entered into the Placing and Open
Offer Agreement with the Company under which, among other things,
Shore Capital Stockbrokers has agreed to use its reasonable
endeavours to procure Placees to take up the Placing Shares, on the
terms and subject to the conditions set out therein.
The Issue Price is a fixed price of 30 pence per Placing
Share.
Shore Capital Stockbrokers will today commence the Bookbuild.
This Appendix gives details of the terms and conditions of, and the
mechanics of participation in, the Placing. No commissions will be
paid to Placees or by Placees in respect of any Placing Shares. The
Placing is not being underwritten.
Shore Capital Stockbrokers shall be entitled to effect the
Placing by such alternative method to the Bookbuild as it may, in
its absolute discretion following consultation with the Company,
determine.
The Placing Shares will, as from the date when they are issued,
be fully paid up, rank in full for all dividends and other
distributions declared, made or paid on the Ordinary Shares after
Admission and otherwise rank pari passu in all respects with, and
be identical to, the existing Ordinary Shares then in issue.
Application for listing and admission to trading
Application will be made for admission of the Placing Shares,
the Subscription Shares, the Consideration Shares and the Open
Offer Shares to trading on AIM.
It is expected that Admission will become effective at 8.00 a.m.
on or around 23 November 2021 and that dealings in the Placing
Shares will commence at that time (or such later time and/or date
as the Company and Shore Capital may agree).
Participation in, and principal terms of, the Placing
Shore Capital Stockbrokers is arranging the Placing as broker
and agent of the Company for the purpose of procuring Placees at
the Issue Price for the Placing Shares.
1 Participation in the Placing will only be available to persons
who may lawfully be, and are, invited to participate by Shore
Capital Stockbrokers. Shore Capital Stockbrokers may itself (but is
not obliged to) agree to be a Placee in respect of all or some of
the Placing Shares or may nominate any member of its group to do
so.
2 The number of Placing Shares to be issued at the Issue Price
will be agreed by Shore Capital Stockbrokers (in consultation with
the Company) following completion of the Bookbuild. The number of
Placing Shares to be issued will also be announced on an RIS
following the completion of the Bookbuild (the "Placing Results
Announcement").
3 To bid in the Bookbuild, Placees should communicate their bid
by telephone to their usual sales contact at Shore Capital
Stockbrokers. Each bid should state the number of Placing Shares
which the prospective Placee wishes to subscribe for. Bids may be
scaled down by Shore Capital Stockbrokers on the basis referred to
in paragraph 7 below.
4 A bid in the Bookbuild 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 Shore
Capital Stockbrokers' consent, will not be capable of variation or
revocation after the time at which it is submitted. Each Placee
will also have an immediate, separate, irrevocable and binding
obligation, owed to the Company and Shore Capital Stockbrokers, to
pay to them (or as Shore Capital Stockbrokers may direct) in
cleared funds an amount equal to the product of the Issue Price and
the number of Placing Shares that such Placee has agreed to
subscribe for and the Company has agreed to allot and issue to that
Placee. Each prospective Placee's obligations will be owed to the
Company and Shore Capital Stockbrokers.
5 The Bookbuild is expected to close at 6.30 p.m. on 3 November
2021, but may be closed earlier or later at the discretion of Shore
Capital Stockbrokers. Shore Capital Stockbrokers may, in agreement
with the Company, accept bids, either in whole or in part, that are
received after the Bookbuild has closed.
6 Shore Capital Stockbrokers may choose to accept bids, either
in whole or in part, on the basis of allocations determined in
consultation with the Company and may scale down any bids for this
purpose on such basis as they may determine. Shore Capital
Stockbrokers may also, notwithstanding paragraphs 4 and 5 above,
(a) allocate Placing Shares after the time of any initial
allocation to any person submitting a bid after that time and (b)
allocate Placing Shares after the Bookbuild has closed to any
person submitting a bid after that time. The Company reserves the
right (upon agreement with Shore Capital Stockbrokers) to reduce or
seek to increase the amount to be raised pursuant to the Placing at
its discretion.
7 Allocations of the Placing Shares will be determined by Shore
Capital Stockbrokers in its absolute discretion after consultation
with the Company with regard to the identities of the proposed
Placees in accordance with the conduct of business sourcebook of
the FCA handbook. Allocations will be confirmed orally by Shore
Capital Stockbrokers and a Form of Confirmation will be despatched
as soon as possible thereafter. Shore Capital Stockbrokers' oral
confirmation to such Placee constitutes an irrevocable legally
binding commitment upon such person (who will at that point become
a Placee), in favour of Shore Capital Stockbrokers and the Company,
to acquire the number of Placing Shares allocated to it and to pay
the Issue Price in respect of such shares on the terms and
conditions set out in this Appendix and in accordance with the
Company's articles of association. Except with Shore Capital
Stockbrokers' consent, such commitment will not be capable of
variation or revocation after the time at which it is
submitted.
8 Each Placee's allocation and commitment to Shore Capital
Stockbrokers (acting as placing agent for the Company) will be
evidenced by a Form of Confirmation issued to such Placee by Shore
Capital Stockbrokers. The terms of this Appendix will be deemed
incorporated in that contract note.
9 Irrespective of the time at which a Placee's allocation
pursuant to the Placing is confirmed, settlement for all Placing
Shares to be acquired pursuant to the Placing will be required to
be made at the same time, on the basis explained below under
"Registration and Settlement".
10 All obligations of Shore Capital under the Placing will be
subject to fulfilment of the conditions referred to below under
"Conditions of the Placing" and to the Placing not being terminated
on the basis referred to below under "Right to terminate under the
Placing and Open Offer Agreement".
11 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 below under "Right to terminate
under the Placing and Open Offer Agreement" and will not be capable
of rescission or termination by the Placee.
12 To the fullest extent permissible by law, neither Shore
Capital, nor the Company, nor any of their respective affiliates,
agents, directors, officers or employees shall have any
responsibility or liability to Placees (or to any other person
whether acting on behalf of a Placee or otherwise). In particular,
neither Shore Capital, nor the Company, nor any of their respective
affiliates, agents, directors, officers or employees shall have any
responsibility or liability (including to the extent permissible by
law, any fiduciary duties) in respect of the conduct of the Placing
or of such alternative method of effecting the Placing as Shore
Capital and the Company may determine.
13 The Placing Shares will be issued subject to the terms and
conditions of this Appendix and each Placee's commitment to
subscribe for Placing Shares on the terms set out herein will
continue notwithstanding any amendment that may in future be made
to the terms and conditions of the Placing and Placees will have no
right to be consulted or require that their consent be obtained
with respect to the Company's or Shore Capital's conduct of the
Placing.
14 All times and dates in this Announcement may be subject to
amendment. Shore Capital Stockbrokers shall notify the Placees and
any person acting on behalf of the Placees of any such changes.
Conditions of the Placing
The Placing is conditional upon the Placing and Open Offer
Agreement becoming unconditional and not having been terminated in
accordance with its terms.
Shore Capital's obligations under the Placing and Open Offer
Agreement in respect of the EIS Placing Shares are conditional on,
inter alia:
1 there not having arisen or occurred before Admission any
matter, fact, circumstance or event such that in the opinion of
Shore Capital, a supplementary circular is required to be published
unless a supplementary circular has been published with Shore
Capital's consent;
2 the documentation effecting the Subscription becoming
unconditional (save for Admission);
3 the warranties on the part of the Company being true and
accurate and not misleading on and as at the date of the Placing
and Open Offer Agreement and at all times up to Admission in each
case as though the Warranties had been given and made at each such
times by reference to the facts and circumstances then
existing;
4 publication of the Placing Results Announcement through an RIS
by no later than 6.00pm on the date of this Announcement (or such
other time and/or date as Shore Capital may determine);
5 the passing of the Resolutions by the requisite majorities;
6 the Acquisition Agreement and the Option Agreement having been
entered into on or before the date of this Announcement and
remaining in full force and effect (without any amendments to its
terms) and not having been terminated or lapsed;
7 there not occurring, in Shore Capital's opinion (acting in
good faith), a Material Adverse Change (as defined in the Placing
and Open Offer Agreement), since the date of the Placing and Open
Offer Agreement; and
8 the EIS Placing Shares having been unconditionally allotted
and issued by the Company at or before 11:59 p.m. on the day
immediately prior to the Admission Date.
Shore Capital's obligations under the Placing and Open Offer
Agreement in respect of the VCT Placing Shares are conditional on,
inter alia:
1 all the conditions in the Placing and Open Offer Agreement
relating to the issue of the EIS Placing Shares having been
fulfilled (or, where applicable, waived); and
2 the VCT Placing Shares having been unconditionally allotted
and issued by the Company at or before 7:30 a.m. on the Admission
Date.
Shore Capital's obligations under the Placing and Open Offer
Agreement in respect of the Non-EIS/VCT Placing Shares are
conditional on, inter alia:
1 all the conditions in the Placing and Open Offer Agreement
relating to the issue of the VCT Placing Shares having been
fulfilled (or, where applicable, waived);
2 the Non-EIS/VCT Placing Shares having been unconditionally
allotted and issued by the Company at or before 8:00 a.m. on the
Admission Date;
3 Admission occurring not later than 8:00 a.m. on 23 November
2021 (or such later time and/or date, not being later than 8:00
a.m. on the Long Stop Date, as the Company and Shore Capital may
otherwise agree); and
4 the Company having complied with or performed its obligations
under the Placing and Open Offer Agreement to the extent that the
same fall to be performed prior to Admission.
Shore Capital may, at its discretion and upon such terms as it
thinks fit, waive compliance by the Company with the whole or any
part of any of its obligations in relation to certain conditions in
the Placing and Open Offer Agreement save that the above conditions
relating, inter alia, to Admission taking place may not be
waived.
Any such extension or waiver will not affect Placees'
commitments as set out in this Announcement.
If: (i) any of the conditions contained in the Placing and Open
Offer Agreement, including those described above, is not fulfilled
or (where permitted) waived by Shore Capital by the relevant time
or date specified (or such later time and/or date as the Company
and Shore Capital may agree); or (ii) the Placing and Open Offer
Agreement is terminated in the circumstances specified below, the
Placing will lapse, any funds delivered by the Placee to Shore
Capital Stockbrokers or the Company in respect of the Placee's
participation will be returned to the Placee at the Placee's risk
without interest and the Placees' rights and obligations hereunder
in relation to the Placing Shares shall cease and terminate at such
time and each Placee agrees that no claim can be made by it (or any
person on whose behalf the Placee is acting) in respect
thereof.
Neither Shore Capital nor any of their respective affiliates,
agents, directors, officers or employees 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 they
may make as to whether or not to waive, or to extend the time
and/or date for the satisfaction of, any condition in the Placing
and Open Offer Agreement nor in respect of any decision they may
make as to the satisfaction of any condition or in respect of the
Placing generally and by participating in the Placing each Placee
agrees that any such decision is within the absolute discretion of
Shore Capital.
Right to terminate under the Placing and Open Offer
Agreement
Shore Capital is entitled, at any time before Admission, to
terminate (after such consultation with the Company where
practicable to do so) the Placing and Open Offer Agreement in
accordance with its terms in certain circumstances, including,
inter alia:
1 any statement contained in the documents entered into in
connection with the Fundraising becoming untrue, inaccurate or
misleading or any matter having arisen which would, if such
documents were issued or entered into at that time, constitute a
material omission from such documents or any of them and which
Shore Capital considers to be material and adverse in the context
of the Fundraising and -Admission; or
2 any of the warranties given in the Placing and Open Offer
Agreement having been breached or being untrue, inaccurate or
misleading when made and/or that any such warranties having ceased
to be true or accurate or having become misleading (and being
incapable of remedy prior to Admission) in each case by reference
to the facts and circumstances subsisting at that time; or
3 no event having arisen at any time prior to Admission which
means a condition under the Acquisition Agreement will not be
capable of satisfaction; or
4 a matter, fact, circumstance or event has arisen such that in
the opinion of Shore Capital, a supplementary circular is required
to be published or a supplementary circular is published; or
5 in the opinion of Shore Capital (acting in good faith), a
Material Adverse Change (as defined in the Placing and Open Offer
Agreement) has occurred (whether or not foreseeable at the date of
the Placing and Open Offer Agreement); or
6 in the opinion of Shore Capital (acting in good faith) there
has occurred one or more specified adverse macro-economic changes,
suspension or material limitation in the trading on AIM or the
London Stock Exchange's main market for listed securities of any
securities of the Company or a general moratorium on commercial
banking activities in London or New York which, in the opinion of
Shore Capital (acting in good faith) would, among other things,
materially prejudice the success of, or make it impractical or
inadvisable to proceed with, the Fundraising (or any part of it)
and/or Admission.
By participating in the Placing, Placees agree that the exercise
by Shore Capital of any right of termination or other discretion
under the Placing and Open Offer Agreement shall be within the
absolute discretion of Shore Capital and that it need not make any
reference to, or consult with, Placees and that it shall have no
liability to Placees whatsoever in connection with any such
exercise.
Restriction on Further Issue of Shares and certain other
matters
The Company has undertaken to Shore Capital that, between the
date of the Placing and Open Offer Agreement and 180 days after
Admission, it will not, without the prior written consent of Shore
Capital, inter alia:
1 allot or issue any Ordinary Shares (or any other shares or
securities in the capital of the Company) or issue any options over
Ordinary Shares (or any securities exchangeable for, or convertible
into, Ordinary Shares or other shares or securities in the capital
of the Company). 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 Subscription or the
grant or exercise of options under any of the Company's existing
share incentives and share option schemes, or
2 enter into or procure or (so far as it is able) permit the
Group (as enlarged by the Acquisition) to enter into any
commitment, agreement or arrangement, or knowingly do or permit to
be done any other act or thing which is material in the context of
the Fundraising and Admission and would require the Company to make
an announcement through an RIS.
By participating in the Placing, Placees agree that the exercise
by Shore Capital of any power to grant consent to the undertaking
by the Company of a transaction which would otherwise be subject to
the restrictive provisions on further issuance under the Placing
and Open Offer Agreement shall be within the absolute discretion of
Shore Capital and that it need not make any reference to, or
consult with, Placees and that it shall have no liability to
Placees whatsoever in connection with any such exercise of the
power to grant consent.
No Prospectus
No offering document or prospectus has been or will be submitted
to be approved by the FCA or submitted to the London Stock Exchange
in relation to the Placing.
Placees' commitments will be made solely on the basis of of
publicly available information taken together with the information
contained in this Announcement, and any other Exchange Information
and subject to the further terms set forth in the Form of
Confirmation. Each Placee, by accepting a participation in the
Placing, agrees that the content of this Announcement (including
this Appendix) and all other Exchange Information is exclusively
the responsibility of the Company and confirms that it has neither
received nor relied on any other information, representation,
warranty or statement made by or on behalf of the Company or Shore
Capital or any other person and none of the Company or Shore
Capital nor any other person will be liable for any Placee's
decision to participate in the Placing based on any other
information, representation, warranty or statement which the
Placees may have obtained or received. 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. Nothing in this paragraph shall
exclude the liability of any person for fraudulent
misrepresentation by that person.
Registration and Settlement
Settlement of transactions in the Placing Shares (ISIN:
GB00BDB79J29) following Admission will take place within CREST.
Subject to certain exceptions, Shore Capital Stockbrokers and the
Company reserve the right to require settlement for, and delivery
of, the Placing Shares (or any part thereof) to Placees by such
other means that they deem necessary if delivery or settlement is
not possible or practicable within CREST within the timetable set
out in this Announcement or would not be consistent with the
regulatory requirements in the Placee's jurisdiction.
Each Placee allocated Placing Shares in the Placing will be sent
a Form of Confirmation in accordance with the standing arrangements
in place with Shore Capital Stockbrokers stating the number of
Placing Shares allocated to it at the Issue Price, the aggregate
amount owed by such Placee to Shore Capital Stockbrokers and
settlement instructions. Each Placee agrees that it will do all
things necessary to ensure that delivery and payment is completed
in accordance with the standing CREST or certificated settlement
instructions in respect of the Placing Shares that it has in place
with Shore Capital Stockbrokers. Settlement within CREST will take
place on a delivery versus payment basis.
Interest is chargeable daily on payments not received from
Placees on the due date in accordance with the arrangements set out
above at the rate of two percentage points above the base rate of
Barclays Bank PLC as determined by Shore Capital Stockbrokers.
It is expected that settlement will be on 23 November 2021 in
accordance with the instructions set out in the Form of
Confirmation.
Each Placee is deemed to agree that, if it does not comply with
these obligations, Shore Capital Stockbrokers may sell any or all
of the Placing Shares allocated to that Placee on such Placee's
behalf and retain from the proceeds, for Shore Capital
Stockbrokers' account and benefit, an amount equal to the aggregate
amount owed by the Placee plus any interest due. The relevant
Placee will, however, remain liable for any shortfall below the
aggregate amount owed by it and may be required to bear any stamp
duty or stamp duty reserve tax (together with any interest or
penalties) or other similar taxes imposed in any jurisdiction which
may arise upon the sale of such Placing Shares on such Placee's
behalf.
If Placing Shares are to be delivered to a custodian or
settlement agent, Placees should ensure that the Form of
Confirmation is copied and delivered immediately to the relevant
person within that organisation.
Insofar as Placing Shares are registered in a Placee's name or
that of its nominee or in the name of any person for whom a Placee
is contracting as agent or that of a nominee for such person, such
Placing Shares should, subject as provided below, be so registered
free from any liability to UK stamp duty or stamp duty reserve tax.
If there are any circumstances in which any stamp duty or stamp
duty reserve tax or other similar taxes or duties (including any
interest and penalties relating thereto) is payable in respect of
the allocation, allotment, issue, sale, transfer or delivery of the
Placing Shares (or, for the avoidance of doubt, if any stamp duty
or stamp duty reserve tax is payable in connection with any
subsequent transfer of or agreement to transfer Placing Shares),
none of Shore Capital nor the Company shall be responsible for
payment thereof.
Representations, Warranties, Undertakings and Further Terms
By participating in the Placing each Placee (and any person
acting on such Placee's behalf) irrevocably:
1 represents and warrants that it has read and understood this
Announcement, including this Appendix, in its entirety and that its
acquisition of Placing Shares is subject to and based upon all the
terms, conditions, representations, warranties, acknowledgements,
agreements and undertakings and other information contained herein
and undertakes not to redistribute or duplicate this
Announcement;
2 acknowledges that its obligations are irrevocable and legally
binding and shall not be capable of rescission or termination by it
in any circumstances;
3 acknowledges that no offering document or prospectus has been
or will be prepared in connection with the Placing and represents
and warrants that it has not received and will not receive a
prospectus or other offering document in connection with the
Placing or the Placing Shares and that any participation in the
Bookbuild will solely be on the basis of the information in this
Announcement and other Exchange Information;
4 acknowledges that the Placing does not constitute a
recommendation or financial product advice and Shore Capital has
had regard to its particular objectives, financial situation or
needs;
5 acknowledges that none of Shore Capital, the Company, any of
their respective affiliates, agents, directors, officers or
employees has provided, nor will provide, it with any material
regarding the Placing Shares or the Company other than the Circular
(when published) and this Announcement; nor has it requested any of
Shore Capital, the Company, any of their respective affiliates or
any person acting on behalf of any of them to provide it with any
such information;
6 acknowledges that 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
rules and practices under the AIM Rules, which includes a
description of the Company's business and the Company's financial
information, including balance sheets and income statements, and
that it is able to obtain or access such information, or comparable
information concerning other publicly traded companies, in each
case without undue difficulty;
7 acknowledges that the content of the Circular (when published)
and this Announcement is exclusively the responsibility of the
Company and that none of Shore Capital, nor their respective
affiliates or any person acting on behalf of any of them, has or
shall have any liability for any information, representation or
statement contained in, or omission from, the Circular and/or this
Announcement or any information previously published by or on
behalf of the Company, pursuant to applicable laws, and will not be
liable for any Placee's decision to participate in the Placing
based on any information, representation or statement contained in
the Circular or this Announcement or otherwise. Each Placee further
represents, warrants and agrees that the only information on which
it is entitled to rely and on which such Placee has relied in
committing itself to acquire Placing Shares is contained in this
Announcement and other Exchange Information, such information being
all that such Placee deems necessary or appropriate and sufficient
to make an investment decision in respect of the Placing Shares and
that it has neither received nor relied on any other information
given, or representations, warranties or statements made, by any of
Shore Capital or the Company nor any of their respective
affiliates, agents, directors, officers or employees and none of
Shore Capital or the Company or any such affiliate, agent,
director, officer or employee will be liable for any Placee's
decision to accept an invitation to participate in the Placing
based on any other information, representation, warranty or
statement, provided that nothing in this paragraph excludes the
liability of any person for fraudulent misrepresentation made by
that person;
8 acknowledges and agrees that it may not rely, and has not
relied, on any investigation that Shore Capital, any of their
respective affiliates or any person acting on their respective
behalfs, may have conducted with respect to the Placing Shares or
the Company, and none of such persons has made any representation,
express or implied, with respect to the Company, the Placing Shares
or the accuracy, completeness or adequacy of the information from
the London Stock Exchange or any other information; each Placee
further acknowledges that it has received all information it
believes necessary or appropriate in connection with its investment
in the Placing Shares;
9 it has made its own assessment of the Placing Shares and has
relied on its own investigation of the business, financial and
trading position of the Company in accepting a participation in the
Placing and neither Shore Capital, the Company nor any of their
respective affiliates, agents, directors, officers or employees or
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 Exchange Information
and any information in the Circular and any supplementary circular
published by the Company subsequent to the date of this
Announcement; nor has it requested any of Shore Capital, the
Company, any of their respective affiliates, agents, directors,
officers or employees or any person acting on behalf of any of them
to provide it with any such information;
10 the content of this Announcement is exclusively the
responsibility of the Company and the Directors and neither Shore
Capital nor any person acting on behalf of either of them or any of
their respective affiliates, agents, directors, officers or
employees has or shall have any liability for any information,
representation or statement contained in this Announcement, the
Circular or any supplementary circular (as the case may be) or any
Exchange Information or other information previously published by
or on behalf of the Company or any member of the Group;
11 represents and warrants that it, and any prospective
beneficial owner for whose account or benefit it is purchasing the
Placing Shares, is and, at the time the Placing Shares are
subscribed for, will be located outside the United States and is
acquiring the Placing Shares in an "offshore transaction" as
defined in, and in accordance with, Regulation S;
12 represents and warrants that it has not been offered to
purchase or subscribe for Placing Shares by means of (i) any
"directed selling efforts" as defined in Regulation S, or (ii) any
form of "general solicitation" or "general advertising" within the
meaning of Rule 502(c) of Regulation D in connection with any offer
or sale of Placing Shares in the United States;
13 confirms that it understand that the Placing Shares:
(a) have not been and will not be registered or otherwise
qualified and that a prospectus will not be cleared in respect of
any of the Placing Shares under the securities laws or legislation
of the United States, Australia, Canada, Japan, New Zealand, the
Republic of South Africa, or any state, province, territory or
jurisdiction thereof;
(b) may not be offered, sold, or delivered or transferred,
directly or indirectly, in or into the above jurisdictions or any
jurisdiction (subject to certain exceptions) in which it would be
unlawful to do so and no action has been or will be taken by any of
the Company, Shore Capital or any person acting on behalf of the
Company or Shore Capital that would, or is intended to, permit a
public offer of the Placing Shares in the United States, Australia,
Canada, Japan, New Zealand, the Republic of South Africa or any
country or jurisdiction, or any state, province, territory or
jurisdiction thereof, where any such action for that purpose is
required;
14 unless otherwise specifically agreed with Shore Capital,
confirms that it is not and at the time the Placing Shares are
subscribed for, neither it nor the beneficial owner of the Placing
Shares will be, a resident of, nor have an address in, Australia,
Japan, New Zealand, the Republic of South Africa or any province or
territory of Canada;
15 confirms that it, and any prospective beneficial owner for
whose account or benefit it is purchasing the Placing Shares: (i)
is not a US Person (as defined in Regulation S) and is, and at the
time the Placing Shares are subscribed for will be, located outside
the United States and is acquiring the Placing Shares in an
"offshore transaction" as defined in, and in accordance with,
Regulation S; (ii) is aware of the restrictions on the offer and
sale of the Placing Shares pursuant to Regulation S, including that
Rule 904 of Regulation S regarding "Offshore Resales" is not
applicable to "affiliates" (as defined in Rule 405 under the
Securities Act) of the Company; and (iii) has not been offered to
purchase or subscribe for Placing Shares by means of any "directed
selling efforts" as defined in Regulation S;
16 confirms that it understands that the Placing Shares have not
been, and will not be, registered under the US Securities Act and
may not be offered, sold or resold in or into or from the United
States or to, or for the account or benefit of, US Persons (as
defined in Regulation S) except pursuant to an effective
registration under the US Securities Act, or pursuant to an
exemption from the registration requirements of the US Securities
Act and in accordance with applicable state securities laws;
17 confirms that 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, Australia, Canada, Japan, New
Zealand, the Republic of South Africa (including electronic copies
thereof) to any person, and it has not distributed, forwarded,
transferred or otherwise transmitted any such materials to any such
person;
18 acknowledges that in making any decision to acquire Placing Shares it:
(a) has such knowledge and experience in financial and business
matters to be capable of evaluating the merits and risks of
subscribing for or purchasing the Placing Shares;
(b) will not look to Shore Capital for all or part of any loss
it may suffer as a result of any such subscription or purchase;
(c) is experienced in investing in securities of this nature in
this sector and is aware that it may be required to bear, and is
able to bear, the economic risk of an investment in the Placing
Shares;
(d) is able to sustain a complete loss of an investment in the Placing Shares; and
(e) has no need for liquidity with respect to its investment in the Placing Shares;
19 if it indicates to Shore Capital Stockbrokers that it wishes
to subscribe for VCT Placing Shares, confirms that:
(a) it is a VCT, subscribing for such VCT Shares pursuant to the
Placing using VCT funds; and
(b) confirms that the date on which it raised funds was on or after 6 April 2012;
20 if it indicates to Shore Capital Stockbrokers that it wishes
to subscribe for EIS Placing Shares, confirms that the beneficial
owner of such shares will be a "qualifying investor" within the
meaning of section 162 Income Tax Act 2007;
21 represents and warrants that the issue to it, or the person
specified by it for registration as holder, of Placing Shares will
not give rise to a liability under any of sections 67, 70, 93 or 96
of the Finance Act 1986 (depositary receipts and clearance
services) and that the Placing Shares are not being acquired in
connection with arrangements to issue depositary receipts or to
issue or transfer Placing Shares into a clearance service;
22 represents and warrants that it has complied with its
obligations under the Criminal Justice Act 1993, MAR and in
connection with money laundering and terrorist financing under the
Money Laundering Regulations and the Money Laundering Sourcebook of
the FCA 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 Money
Laundering Regulations;
23 acknowledges that in order to ensure compliance with the
Money Laundering Regulations, Shore Capital Stockbrokers (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, location or legal status. Pending the provision to
Shore Capital Stockbrokers or the Company's registrars, as
applicable, of evidence of identity, location or legal status,
definitive certificates in respect of the Placing Shares may be
retained at Shore Capital Stockbrokers' absolute discretion or,
where appropriate, delivery of the Placing Shares to it in
uncertificated form may be delayed in Shore Capital Stockbrokers'
or the Company's registrars', as the case may be, absolute
discretion. If within a reasonable time after a request for
verification of identity, location or legal status, Shore Capital
Stockbrokers (for itself and as agent on behalf of the Company) or
the Company's registrars have not received evidence satisfactory to
them, either Shore Capital Stockbrokers and/or the Company may, at
its absolute discretion, terminate its commitment in respect of the
Placing, in which event the monies payable on the conditional
allocation of Placing Shares allotment will, if already paid, be
returned without interest to the account of the drawee's bank from
which they were originally debited;
24 represents and warrants that it is acting as principal only
in respect of the Placing or, if it is acting for any other person:
(i) it is duly authorised to do so and has full power to make the
acknowledgements, warranties, representations, confirmations,
undertakings, and agreements herein on behalf of each such person;
and (ii) it is and will remain liable to the Company and/or Shore
Capital Stockbrokers 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);
25 if it is a financial intermediary, as that term is used in
Article 2(d) of the Prospectus Regulation or the UK Prospectus
Regulation, as applicable, that it understands the resale and
transfer restrictions set out in this Appendix and that any Placing
Shares acquired by it in the Placing 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 circumstances
which may give rise to an offer of securities to the public other
than an offer or resale in a member state of the EEA to EEA
Qualified Investors or in the United Kingdom to Relevant Persons,
or in circumstances in which the prior consent of Shore Capital
Stockbrokers has been given to each such proposed offer or
resale.
26 that it has not offered or sold and, prior to the expiry of a
period of six months from Admission, will not offer or sell any
Placing Shares to persons in the EEA, except to Qualified Investors
or otherwise in circumstances which have not resulted and which
will not result in an offer to the public in any member state in
the EEA within the meaning of Article 2(d) of the Prospectus
Regulation;
27 that it has not offered or sold and, prior to the expiry of a
period of six months from Admission, will not offer or sell any
Placing Shares to persons in the United Kingdom, except to Relevant
Persons 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 Article 2(d) of the UK Prospectus
Regulation;
28 that any offer of Placing Shares may only be directed at
persons in member states of the EEA who are Qualified Investors and
represents, warrants and undertakes that it has not offered or sold
and will not offer or sell any Placing Shares to persons in the EEA
prior to Admission except to Qualified Investors or otherwise in
circumstances which have not resulted and which will not result in
an offer to the public in any member state of the EEA within the
meaning of the Prospectus Regulation;
29 that any offer of Placing Shares may only be directed at
persons in the United Kingdom who are Relevant Persons and
represents, warrants and undertakes that it has not offered or sold
and will not offer or sell any Placing Shares to persons in the
United Kingdom prior to Admission except to Relevant Persons 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 the UK Prospectus Regulation;
30 represents, warrants and undertakes that it has only
communicated or caused to be communicated and will only communicate
or cause to be communicated any invitation or inducement to engage
in investment activity (within the meaning of section 21 of the
FSMA) relating to the Placing Shares in circumstances in which
section 21(1) of the FSMA does not require approval of the
communication by an authorised person;
31 represents, warrants and undertakes that it has complied and
will comply with all applicable provisions of the FSMA with respect
to anything done by it in relation to the Placing Shares in, from
or otherwise involving the United Kingdom;
32 represents and warrants, if in a member state of the European
Economic Area, unless otherwise specifically agreed with Shore
Capital in writing, that it is a EEA Qualified Investor;
33 represents and warrants, if in the United Kingdom, that it is
a person (i) having professional experience in matters relating to
investments who falls within the definition of "investment
professionals" in Article 19(5) of the Order or (ii) who falls
within Article 49(2)(a) to (d) ("High Net Worth Companies,
Unincorporated Associations, etc") of the Order, or (iii) to whom
this Announcement may otherwise lawfully be communicated;
34 acknowledges and agrees that no action has been or will be
taken by either the Company or Shore Capital or any person acting
on behalf of the Company or Shore Capital that would, or is
intended to, permit a public offer of the Placing Shares in any
country or jurisdiction where any such action for that purpose is
required;
35 represents and warrants that it and any person acting on its
behalf is entitled to acquire the Placing Shares under the laws of
all relevant jurisdictions and that it has fully observed such laws
and obtained all such governmental and other guarantees, permits,
authorisations, approvals and consents which may be required
thereunder and complied with all necessary formalities to enable it
to commit to this participation in the Placing and to perform its
obligations in relation thereto (including, without limitation, in
the case of any person on whose behalf it is acting, all necessary
consents and authorities to agree to the terms set out or referred
to in this Appendix) and will honour such obligations and that it
has not taken any action or omitted to take any action which will
or may result in Shore Capital, the Company or any of their
respective directors, officers, agents, employees or advisers
acting in breach of the legal or regulatory requirements of any
jurisdiction in connection with the Placing;
36 undertakes that it (and any person acting on its behalf) will
make payment in respect of the Placing Shares allocated to it in
accordance with this Appendix on the due time and date set out
herein, failing which the relevant Placing Shares may be placed
with other acquirers or sold as Shore Capital Stockbrokers may in
their sole discretion determine and without liability to such
Placee, who will remain liable for any amount by which the net
proceeds of such sale fall short of the product of the relevant
Issue Price and the number of Placing Shares allocated to it and
may be required to bear any stamp duty, stamp duty reserve tax or
other similar taxes (together with any interest or penalties) which
may arise upon such placing or sale of such Placee's Placing
Shares;
37 acknowledges that none of Shore Capital, nor any of their
respective affiliates, agents, directors, officers or employees 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 its participation in the Placing is on
the basis that it is not and will not be a client of Shore Capital
in connection with its participation in the Placing and that Shore
Capital has any duty nor responsibility to it for providing the
protections afforded to its clients or customers or for providing
advice in relation to the Placing nor in respect of any
representations, warranties, undertakings or indemnities contained
in the Placing and Open Offer 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;
38 undertakes that the person whom it specifies for registration
as holder of the Placing Shares will be (i) itself or (ii) its
nominee, as the case may be. Neither Shore Capital nor the Company
will be responsible for any liability to stamp duty or stamp duty
reserve tax or other similar taxes resulting from a failure to
observe this requirement ("Indemnified Taxes"). Each Placee and any
person acting on behalf of such Placee agrees to indemnify the
Company and Shore Capital on an after-tax basis in respect of any
Indemnified Taxes;
39 agrees to indemnify on an after tax basis and hold the
Company, Shore Capital and their respective affiliates harmless
from any and all costs, claims, liabilities and expenses (including
legal fees and expenses) arising out of or in connection with any
breach of its representations, warranties, acknowledgements,
agreements and undertakings in this Appendix and further agrees
that the provisions of this Appendix shall survive after completion
of the Placing;
40 except as set out in paragraph 41 below, represents and
warrants that it has neither received nor relied on any 'inside
information' (for the purposes of MAR and section 56 of the
Criminal Justice Act 1993) concerning the Company prior to or in
connection with accepting the invitation to participate in the
Placing and is not purchasing Placing Shares on the basis of
material non-public information;
41 if it has received any 'inside information' (for the purposes
of MAR and section 56 of the Criminal Justice Act 1993) in relation
to the Company and its securities, confirms that it has received
such information within the market soundings regime provided for in
article 11 of MAR and associated delegated regulations and it has
not: (i) dealt (or attempted to deal) in the securities of the
Company; (ii) encouraged, recommended or induced another person to
deal in the securities of the Company; or (iii) unlawfully
disclosed inside information to any person, prior to the
information being made publicly available;
42 if it is a pension fund or investment company, confirms that
its purchase of Placing Shares is in full compliance with
applicable laws and regulations;
43 agrees that the Company, Shore Capital and their respective
affiliates and others will rely upon the truth and accuracy of the
foregoing representations, warranties, acknowledgements,
agreements, and undertakings which are given to Shore Capital for
themselves and on behalf of the Company and are irrevocable and it
irrevocably authorises the Company and Shore Capital to produce
this Announcement, pursuant to, in connection with, or as may be
required by, any applicable law or regulation, administrative or
legal proceeding or official inquiry with respect to the matters
set forth herein;
44 acknowledges that none of the Company or Shore Capital owes
any fiduciary or other duties to any Placee in respect of any
acknowledgments, confirmations, undertakings, representations,
warranties or indemnities in the Placing and Open Offer
Agreement;
45 acknowledges and agrees that its commitment to take up
Placing Shares on the terms set out in this Announcement (including
this Appendix) will continue notwithstanding any amendment that may
or in the 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 or Shore
Capital's conduct of the Placing;
46 acknowledges that 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 Shore Capital
Stockbrokers or 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;
47 acknowledges that time is of essence as regards its obligations under this Appendix;
48 acknowledges that information provided by it to the Company
and the Registrar will be stored on the Company's and/or the
Registrars' computer system(s), and acknowledges and agrees that
for the purposes of the General Data Protection Regulation (EU)
2016/679 and other relevant data protection legislation which may
be applicable (the "Data Protection Law"), the Company and the
Registrars are required to specify the purposes for which they will
hold personal data; and that it has obtained the consent of any
data subjects to the Registrars and the Company and their
respective associates holding and using their personal data for the
Purposes (as defined below). For the purposes of this Announcement,
"data subject", "personal data" and "sensitive personal data" shall
have the meanings attributed to them in the Data Protection Law.
The Company and the Registrars will only use such information for
the purposes set out below (collectively, the "Purposes"), being
to:
(a) process its personal data (including sensitive personal
data) as required by or in connection with its holding of Ordinary
Shares, including processing personal data in connection with
credit and money laundering checks on it;
(b) communicate with it as necessary in connection with its
affairs and generally in connection with its holding of Ordinary
Shares;
(c) provide personal data to such third parties as the Company
or the Registrars may consider necessary in connection with its
affairs and generally in connection with its holding of Ordinary
Shares or as the Data Protection Law may require, including to
third parties outside the United Kingdom or the European Economic
Area;
(d) without limitation, provide such personal data to the
Company or Shore Capital for processing, notwithstanding that any
such party may be outside the United Kingdom or the EEA States;
and
(e) process its personal data for the Company's or Registrars'
internal administration; and
49 acknowledges that these terms and conditions and any
agreements entered into by it pursuant to the terms and conditions
set out in this Appendix, and all non-contractual or other
obligations arising out of or in connection with them, shall be
governed by and construed in accordance with the laws of England
and Wales and it submits (on behalf of itself and on behalf of any
person on whose behalf it is acting) to the exclusive jurisdiction
of the English courts as regards any claim, dispute or matter
arising out of any such contract (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 any interest chargeable thereon) may be taken by
either the Company or Shore Capital 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.
The foregoing representations, warranties, agreements,
undertakings, acknowledgements and confirmations are given for the
benefit of the Company as well as Shore Capital and are
irrevocable. Each Placee, and any person acting on behalf of the
Placee, acknowledges that neither the Company nor either of Shore
Capital owes any fiduciary or other duties to any Placee in respect
of any representations, warranties, undertakings, acknowledgements,
agreements or indemnities in the Placing and Open Offer
Agreement.
The agreement to allot and issue Placing Shares to Placees
(and/or to persons for whom such Placee is contracting as agent)
free of stamp duty and stamp duty reserve tax relates only to their
allotment and issue to Placees, or such persons as they nominate as
their agents, direct from the Company for the Placing Shares in
question. Such agreement also assumes that the Placing Shares are
not being acquired in connection with arrangements to issue
depositary receipts or to issue or transfer the Placing Shares into
a clearance service. If there are any such arrangements, or the
settlement relates to any other dealing in the Placing Shares,
stamp duty or stamp duty reserve tax or other similar taxes may be
payable, for which neither the Company nor Shore Capital will be
responsible and the Placees shall indemnify the Company and Shore
Capital on an after-tax basis for any stamp duty or stamp duty
reserve tax paid by them in respect of any such arrangements or
dealings. If this is the case, each Placee should seek its own
advice and notify Shore Capital Stockbrokers accordingly. Placees
are advised to consult with their own advisers regarding the tax
aspects of the subscription for Placing Shares.
The Company and Shore Capital are not liable to bear any
transfer taxes that arise on a sale of Placing Shares subsequent to
their acquisition by Placees or for transfer taxes arising
otherwise than under the laws of the United Kingdom. Each Placee
should, therefore, take its own advice as to whether any such
transfer tax liability arises and notify Shore Capital Stockbrokers
accordingly. Furthermore, each Placee agrees to indemnify on an
after-tax basis and hold each of Shore Capital and the Company and
their respective affiliates harmless from any and all interest,
fines or penalties in relation to stamp duty, stamp duty reserve
tax and all other similar duties or taxes to the extent that such
interest, fines or penalties arise from the default or delay of
that Placee or its agent.
In addition, Placees should note that they will be liable for
any stamp duty and all other stamp, issue, securities, transfer,
registration, documentary or other duties or taxes (including any
interest, fines or penalties relating thereto) payable outside the
UK by them or any other person on the acquisition by them of any
Placing Shares or the agreement by them to acquire any Placing
Shares.
Each Placee and any person acting on behalf of the Placee
acknowledges and agrees that Shore Capital Stockbrokers or any of
its affiliates may, at its absolute discretion, agree to become a
Placee in respect of some or all of the Placing Shares.
When a Placee or person acting on behalf of the Placee is
dealing with Shore Capital Stockbrokers, any money held in an
account with Shore Capital Stockbrokers 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 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 Shore Capital Stockbrokers' money in accordance
with the client money rules and will be used by Shore Capital
Stockbrokers in the course of its own business and the Placee will
rank only as a general creditor of Shore Capital Stockbrokers.
All times and dates in this Announcement are references to
London time and may be subject to amendment. Shore Capital
Stockbrokers shall notify the Placees and any person acting on
behalf of the Placees 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.
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.
[1]
https://www.lek.com/insights/ei/consumer-leisure-spending-growth
[2]
https://medium.com/the-forge-institute/the-experience-economy-millennials-paving-a-new-way-forward-for-marketing-fc508483e80
[3] EBITDA is before exceptional items which are non-trading and
defined as exceptional by the auditors.
This information is provided by RNS, the news service of the
London Stock Exchange. RNS is approved by the Financial Conduct
Authority to act as a Primary Information Provider in the United
Kingdom. Terms and conditions relating to the use and distribution
of this information may apply. For further information, please
contact rns@lseg.com or visit www.rns.com.
RNS may use your IP address to confirm compliance with the terms
and conditions, to analyse how you engage with the information
contained in this communication, and to share such analysis on an
anonymised basis with others as part of our commercial services.
For further information about how RNS and the London Stock Exchange
use the personal data you provide us, please see our Privacy
Policy.
END
MSCBLBDBSXGDGBX
(END) Dow Jones Newswires
November 03, 2021 12:39 ET (16:39 GMT)
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