TIDMAGM
RNS Number : 1303T
Applied Graphene Materials PLC
10 October 2017
THIS ANNOUNCEMENT 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, THE REPUBLIC OF SOUTH
AFRICA, THE REPUBLIC OF IRELAND, NEW ZEALAND OR ANY OTHER
JURISDICTION IN WHICH SUCH RELEASE, PUBLICATION OR DISTRIBUTION
WOULD BE UNLAWFUL.
THIS ANNOUNCEMENT IS FOR INFORMATION PURPOSES ONLY AND DOES NOT
CONSTITUTE OR CONTAIN ANY INVITATION, SOLICITATION, RECOMMATION,
OFFER OR ADVICE TO ANY PERSON TO SUBSCRIBE FOR, OTHERWISE ACQUIRE
OR DISPOSE OF ANY SECURITIES IN APPLIED GRAPHENE MATERIALS PLC OR
ANY OTHER ENTITY IN ANY JURISDICTION. NEITHER THIS ANNOUNCEMENT NOR
THE FACT OF ITS DISTRIBUTION, SHALL FORM THE BASIS OF, OR BE RELIED
ON IN CONNECTION WITH ANY INVESTMENT DECISION IN RESPECT OF APPLIED
GRAPHENE MATERIALS PLC.
THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION FOR THE PURPOSES
OF ARTICLE 7 OF EU REGULATION 596/2014 ("MAR"). IN ADDITION, MARKET
SOUNDINGS (AS DEFINED IN MAR) WERE TAKEN IN RESPECT OF THE MATTERS
CONTAINED IN THIS ANNOUNCEMENT, WITH THE RESULT THAT CERTAIN
PERSONS BECAME AWARE OF INSIDE INFORMATION (AS DEFINED IN MAR), AS
PERMITTED BY MAR. THIS INSIDE INFORMATION IS SET OUT IN THIS
ANNOUNCEMENT AND IN THE ANNOUNCEMENT OF THE COMPANY'S PRELIMINARY
RESULTS FOR THE YEARED 31 JULY 2017, RELEASED EARLIER TODAY.
THEREFORE, THOSE PERSONS THAT RECEIVED INSIDE INFOMRATION IN A
MARKET SOUNDING ARE NO LONGER IN POSSESSION OF SUCH INSIDE
INFORMATION RELATING TO THE COMPANY AND ITS SECURITIES.
Applied Graphene Materials plc
("Applied Graphene Materials" or the "Company")
Proposed Placing by Accelerated Bookbuild to Raise a Minimum of
GBP9 million
-- Applied Graphene Materials (AIM: AGM) is pleased to announce
its intention to conduct a placing of New Ordinary Shares in the
Company (the "Placing Shares"), at a minimum price of 36 pence per
share (the "Issue Price"), with existing and new institutional and
other investors, to raise a minimum of GBP9 million (before
expenses) (the "Placing").
-- The Placing Shares are being offered by way of an accelerated
bookbuild (the "Bookbuild"), which will be launched immediately
following this announcement. Nplus1 Singer Advisory LLP ("N+1
Singer") will be acting as sole bookrunner in connection with the
Bookbuild. Participation in the Placing is subject to the Terms and
Conditions of the Placing set out in the appendix to this
announcement.
-- In addition to the Placing, Qualifying Shareholders will be
given the opportunity to subscribe for New Ordinary Shares through
an open offer to raise up to GBP1 million (before expenses), with
the number of Open Offer Shares to be determined following
confirmation of the Issue Price.
-- The Net Proceeds of the Placing and Open Offer (together the
"Fundraising") will be used to support continued joint development
activity with customers, for the development of the Structural
Ink(TM) programme, to provide working capital and for the scale up
of production capacity, as required.
-- The Fundraising is conditional on, inter alia, the passing of
the Resolutions for which Shareholder approval will be sought at
the General Meeting. A circular, which will provide further details
of the Fundraising and include a notice convening the General
Meeting (the "Circular"), will be sent to Shareholders shortly and
a further announcement will be made.
This announcement should be read in its entirety.
A further announcement will be made on the closing of the
Bookbuild which is expected to occur later today.
Capitalised terms used in this announcement are defined at the
end of the announcement.
N+1 Singer is acting as nominated adviser, broker and sole
bookrunner to the Fundraising, as agent for and on behalf of the
Company. N+1 Singer is authorised and regulated in the United
Kingdom by the FCA and is acting exclusively for the Company and no
one else in connection with the matters referred to in this
announcement and will not be responsible to anyone other than the
Company for providing the protections afforded to the customers of
N+1 Singer or for providing advice in relation to the matters
described in this announcement.
Directors' intended participation in the Placing
The Directors have indicated their intention to participate in
the Placing in respect of a total of GBP44,000 of New Ordinary
Shares.
Forward-looking statements
This announcement includes "forward-looking statements" which
include all statements other than statements of historical facts
including, without limitation, those regarding the Group's
financial position, business strategy, plans and objectives of
management for future operations and any statements preceded by,
followed by or that include forward-looking terminology such as the
words "targets", "plans", "projects", "believes", "estimates",
"aims", "intends", "can", "may", "expects", "forecasts",
"anticipates", "would", "should", "could" or similar expressions or
the negative thereof. Such forward-looking statements involve known
and unknown risks, uncertainties and other important factors beyond
the Company's control that could cause the actual results,
performance or achievements of the Company to be materially
different from future results, performance or achievements
expressed or implied by such forward-looking statements. Such
forward-looking statements are based on numerous assumptions
regarding the Company's present and future business strategies and
the environment in which the Company will operate in the future.
Among the important factors that could cause the Company's actual
results, performance or achievements to differ materially from
those in forward-looking statements include factors in this
announcement entitled "Risk Factors" and elsewhere in this
announcement. These forward-looking statements speak only as at the
date of this announcement. The Company expressly disclaims any
obligation or undertaking to disseminate any updates or revisions
in relation to any forward-looking statements contained herein to
reflect any change in the Company's expectations with regard
thereto or any change in events, conditions or circumstances on
which any such statements are based. As a result of these factors,
the events described in the forward-looking statements in this
announcement may not occur. Prospective investors should be aware
that these statements are estimates, reflecting only the judgement
of the Company's management and prospective investors should not
rely on any forward-looking statements.
Enquiries:
Applied Graphene Materials Tel: +44 (0)1642 438 214
Jon Mabbitt, Chief Executive
Officer
Gareth Jones, Chief Financial
Officer
N + 1 Singer - Nominated Tel: +44 (0)20 7496 3000
Adviser
Richard Lindley
Nick Owen
James White
Alex Laughton-Scott
Additional information on the Fundraising
The Company proposes to raise a minimum of GBP9 million before
expenses by means of the Placing with certain new and existing
institutional and other investors at a minimum price of 36 pence
per share. In addition, in order to provide Qualifying Shareholders
with the opportunity to subscribe for New Ordinary Shares, the
Company has announced an Open Offer to raise up to approximately
GBP1 million, with the number of Open Offer Shares to be determined
following confirmation of the Issue Price. Shareholders subscribing
for their full entitlement under the Open Offer may also apply for
additional Open Offer Shares through the Excess Application
Facility.
The minimum price of 36 pence per share represents a discount of
approximately 44 per cent. to the Closing Price on 9 October 2017,
being the last Business Day prior to the announcement of the
Fundraising. Each of the Placing and Open Offer are conditional on,
inter alia, the passing of the Resolutions at the General Meeting,
Admission becoming effective by no later than 8.00 a.m. on 31
October 2017 (or such other time and / or date, being no later than
30 November 2017, as the Company and N+1 Singer may agree) and the
Placing Agreement between the Company and N+1 Singer becoming
unconditional and not being terminated prior to Admission (in
accordance with its terms). It is expected that the New Ordinary
Shares will be admitted to trading on AIM on or around 8.00 a.m. on
31 October 2017.
The Net Proceeds are intended to be used to support joint
development activity with customers, for the development of the
Structural Ink(TM) programme, to provide ongoing working capital
and to fund the scale up of production capacity as required,
further details of which are set out below.
The Board believes that raising equity finance by way of the
Placing and Open Offer is the most appropriate method of financing
for the Group at this time. This method allows both existing
institutional holders and new institutional and other investors to
be targeted and to participate in the Fundraising. It also avoids
the need for a prospectus to be prepared and issued, which is a
costly and time consuming process, whilst permitting Shareholders
to participate through the Open Offer.
Background to and reasons for the Fundraising
Overview
Applied Graphene Materials is wholly focused on graphene
material production and assisting its adoption by end users in
order to deliver property enhancements and performance benefits
into host materials. The Company has established and is progressing
a large number of customer engagements and has continued to develop
its intellectual property, know-how and knowledge base through
extensive work on the formatting and dispersion of graphene,
including its proprietary graphene delivery technology, Structural
Ink(TM) .
The Group has continued to expand its pipeline of commercial
opportunities, particularly in the two core target market sectors
of coatings and composites where the Board believes that its
products can add most value and that there are large scale and long
term opportunities.
The Group's proprietary production processes have proven its
ability to offer a specialty range of graphene of consistent
quality. This, together with its knowledge of formatting blends and
suspensions, along with the capability to effectively disperse
graphene into customers' materials has, the Directors believe,
positioned the Group to become a leading graphene provider and it
is now pursuing volume production orders.
Commercial progress
The Group continues to expand its pipeline of commercial
opportunities in its core target market sectors of coatings and
composites. The Company is working closely with its development
partners, several of which are leaders in their respective
industries. In addition, the Group continues to work on joint
developments in a limited number of specific opportunities in niche
areas where it believes graphene can provide multifunctional
benefits. In total, the Company has circa 100 active engagements.
The Directors believe that the commercial progress has largely been
driven by the quality of independent, evidence based test data that
the Group has generated and the pro-active marketing efforts to the
end-users of its international business development team. This data
corroborates the Group's expertise and understanding of the key
mechanisms that are involved in the translation of material
properties from a nanoscale into bulk.
The Group's focus remains on converting opportunities with
existing commercial partners to production orders, whilst at the
same time establishing new joint development agreements and
collaborations. The pipeline of opportunities has grown
substantially; although, given their nature, the vast majority of
the Group's customer engagements remain subject to commercial
confidentiality.
The results of the Group's work to date confirm that graphene
has the potential to deliver multi-functional properties with
applicability across many market sectors. Applied Graphene
Materials remains focused on those markets and applications where
it believes that the characteristics of its material are best
suited to address customer requirements. In the near term, the
Company is accessing its core target markets through graphene
formulated using its know-how and formulation techniques, ideally
added in a "plug-and-play" manner to existing customer processes or
with minimum change, which the Directors believe will help to
reduce the time to commercial adoption.
The process of customer acceptance and approval of the Company's
products is dynamic and continues to vary in duration by both
market sector and its intended end use; however, the Company is
seeing good progress. For example, the initial engagement with
Century Composites began one year prior to the adoption of graphene
in their range of fishing rods. However, given the initial success,
they are now extending the inclusion of Applied Graphene's material
into other rods and composite products. Similarly, the Company's
engagement with Airbus Space and Defence began in late 2015 and,
following 18 months of product development work and data
generation, Airbus is now looking to fully qualify the material so
that it can be included in satellites scheduled to be launched in
2018.
Coatings
In the field of paints and coatings, potential application areas
are wide ranging and include marine, aerospace, automotive,
defence, industrial and civil engineering protection. The Group
continues to work closely with a range of customers, including
global leaders, who are looking to include graphene into both
existing and new formulations to improve barrier properties,
particularly in primer layers. In addition, the Company is working
on certain top coat applications where electrical dissipation
performance is beneficial, such as the reduction of dirt pick up,
and in cases where barrier properties can assist with stain
resistance. The Company continues to work on a joint development
with James Briggs Limited, a formulator and supplier of aerosol
paints and high performance materials across numerous markets.
Whilst timings have been longer than originally expected, advanced
testing is to be carried out for the proposed inclusion of the
Group's graphene nanoplatelets in high performance aerosol paint
primers.
The stage of development varies from client to client, but the
Group is well advanced with several partners who are in the later
stages of incorporation prior to potential product launch. Graphene
has the ability to provide both performance improvements as well as
potential cost and environmental benefits. Utilising graphene
requires very little addition by weight, due to the extremely high
surface area of the nanoparticles, meaning that the graphene can be
added with relatively little change to the existing coating
formulation. Legislative directives are forcing re-formulation to
remove zinc phosphate and strontium chromate as active ingredients
in existing primers. This is creating a desire from the coatings
industry to seek environmentally acceptable alternatives to these
products. The Board remains confident that the Group's graphene
additives can win a proportion of this opportunity, providing
performance enhancements, cost savings and environmental benefits
to the end user.
Composites
Applied Graphene Materials' management team has in-depth
knowledge and strong relationships across the estimated EUR70
billion Composites market where the Company is pursuing a multiple
channel approach. The main driver for the inclusion of graphene has
been to improve the toughening of the resin matrix. Trials with the
likes of the University of the West of Scotland and Spirit
AeroSystems Inc. have also demonstrated encouraging improvements to
inter-laminar shear strength, where the introduction of graphene is
acting to reinforce the resinous areas.
The Group has supplied sample quantities of its graphene
pre-dispersed in epoxy resins to formulators and is now progressing
with both intermediate material supply companies and end users who
are interested in benefiting from these performance gains. In March
2017, SHD Composites Limited launched a range of graphene
pre-impregnated (composite) products, MTC9800, which are beginning
to be sold to their customer base.
Early areas of adoption beyond the sports goods sector are
expected to include motorsport, as well as some parts of the
aerospace, automotive, energy and marine sectors. A one year
collaborative project partially funded by the National Aerospace
Technology Exploitation Programme ("NATEP") ended earlier in 2017
and this has provided a strong knowledge base around producing
tougher, lighter and more damage tolerant composite structures. The
Directors believe that the development of novel graphene processing
and deployment techniques identified in the project could lead to
lower operating costs for the aerospace industry.
Structural Ink(TM)
Applied Graphene Materials has developed a highly innovative,
new graphene delivery technology, Structural Ink(TM) , that once
fully commercialised will be targeted at the advanced composites
industry.
Structural Ink(TM) comprises the deposition of graphene
nanoplatelets directly onto composite laminates in a controlled and
targeted manner. By adopting Structural Ink(TM) technology, end
users will have the ability to increase mechanical toughness, which
can be derived through the addition of graphene. Application to
specific areas will, the Directors believe, enable the optimisation
of the performance and structural design of composite materials.
Ultimately, it is believed that this will improve component
integrity and performance, enable further weight reduction and
reduce total manufacturing costs.
Applied Graphene Materials signed heads of terms for a joint
development agreement with the University of Sheffield Advanced
Manufacturing Research Centre with Boeing ("AMRC"). This joint
development agreement focuses on the development and commercial
exploitation of Structural Ink(TM) technology, through
collaboration projects with AMRC's industry partners. AGM plans to
locate a technology demonstration cell within the AMRC's Composites
Centre.
Although at an early phase of its development cycle, four
specialist end-users from different sectors of the composites
industry have committed to explore Structural Ink(TM) . These
include Prodrive Composites Limited ("Prodrive"), which has signed
heads of terms for a joint development agreement with Applied
Graphene Materials to focus on the development towards near term
applications. Prodrive works in the high-end automotive,
motorsport, aerospace and leisure goods sectors, designing and
producing lightweight, high performance composite structures.
Manufacturing technology and know-how and development of
manufacturing capacity
The Group has developed two proprietary production processes
which are protected by existing patents and patent applications,
the latest being granted for Europe in September 2017. The Company
has the ability to produce nanoplatelets tailored to the specific
application through its different manufacturing processes and
formulation know-how. The method of production used to create
graphene nanoplatelets and the control of process variables has a
significant impact on the graphene's properties and it is therefore
highly advantageous to be able to engineer the nanoplatelets to
optimise the target properties for specific applications.
Understanding the mechanisms of property translation from
nanoplatelets to bulk properties is essential to being able to
optimally influence the enhancements that can be achieved in end
products. Transferring the property benefits of graphene is
difficult and the know-how around formatting graphene, combined
with the use of appropriate techniques for inclusion in the host
material, is absolutely crucial. The Group has a toolbox of
technologies that are utilised to optimally format graphene, and
this knowledge base continues to be developed for the benefit of
its commercial partners.
Over the last two years, the Company has continued to refine and
improve its production processes. The Group is able to expand its
capacity through the addition of modular units which gives it the
potential to closely match production capacity to the anticipated
areas of demand. This approach gives a high degree of flexibility
and is more capital efficient than the expansion process originally
envisaged and has enabled the Group to focus resources on
commercial opportunities rather than increasing capacity before it
is required. It is intended that a proportion of the Net Proceeds
will be used to add additional capacity as required.
Use of proceeds
The Net Proceeds are expected to be used as follows:
-- to support joint development activity with customers relating
to the formatting, testing and application of graphene into
products, including analysis equipment for quality control;
-- for the development of the Structural Ink(TM) programme and
to set up a production demonstration unit;
-- to provide ongoing working capital for the business; and
-- to scale up the Company's production facilities to increase
manufacturing capacity of graphene nanoplatelets, as required.
Current trading
The Company announced its preliminary results for the twelve
months ended 31 July 2017 at 7:00 a.m. on 10 October 2017.
Information on the Fundraising
In connection with the Fundraising, the Company has entered into
the Placing Agreement with N+1 Singer, pursuant to which N+1 Singer
has agreed to use reasonable endeavours, as agents on behalf of the
Company, to procure placees for the Placing Shares at the Issue
Price. The Fundraising is conditional, inter alia, on:
- the passing of the Resolutions at the General Meeting;
- the conditions in the Placing Agreement being satisfied or (if
applicable) waived and the Placing Agreement not having been
terminated in accordance with its terms prior to Admission; and
- Admission becoming effective by no later than 8.00 a.m. on 31
October 2017 (or such later time and/or date, being no later than
8.00 a.m. on 30 November 2017, as the Company and N+1 Singer may
agree).
Accordingly, if any of such conditions are not satisfied, or, if
applicable, waived, the Fundraising will not proceed and any Basic
Entitlements and Excess Entitlements admitted to CREST will
thereafter be disabled.
The Placing Agreement contains warranties from the Company in
favour of N+1 Singer. In addition, the Company has agreed to
indemnify N+1 Singer in relation to certain liabilities it may
incur in respect of the Fundraising. N+1 Singer has the right to
terminate the Placing Agreement prior to Admission in certain
circumstances that are customary for an agreement of this nature,
in particular in the event of any breach of the warranties given to
N+1 Singer in the Placing Agreement, the failure of the Company to
comply with any of its obligations under the Placing Agreement, the
occurrence of an adverse change in (amongst other things) national
or international financial or political conditions (which in the
judgement of N+1 Singer (acting reasonably) makes if impractical or
inadvisable to proceed with the Fundraising or which may adversely
affect the Fundraising), and a material adverse change in the
financial position and/or prospects of the Group.
General Meeting
The Circular will contain a notice convening the General Meeting
of the Company to be held at the offices of Squire Patton Boggs at
6 Wellington Place, Leeds LS1 4AP at 11.00 a.m. on 30 October 2017,
at which the Resolutions will be proposed.
Irrevocable undertakings
The Directors have irrevocably undertaken to vote in favour of
the Resolutions in respect of their own beneficial holdings of
1,998,804 Ordinary Shares, in aggregate representing approximately
9.0 per cent. of the Existing Ordinary Shares.
Recommendation and voting intentions
The Directors believe the Fundraising to be in the best
interests of the Company and the Shareholders as a whole.
Accordingly, the Directors unanimously recommend that you vote in
favour of the Resolutions to be proposed at the General Meeting as
they intend to do in respect of their holdings, which amount, in
aggregate, to 1,998,804 Ordinary Shares, representing 9.0 per cent.
of the existing issued share capital of the Company.
RISK FACTORS
An investment in the Ordinary Shares involves a high degree of
risk. Accordingly, prospective investors and Shareholders should
carefully consider the risks set out below before making a decision
to invest in the Company. The investment offered in this
announcement may not be suitable for all of its recipients.
Potential investors and Shareholders are accordingly advised to
consult a professional adviser authorised under FSMA, who
specialises in advising on the acquisition of shares and other
securities, before making any investment decision. A prospective
investor and Shareholders should consider carefully whether an
investment in the Company is suitable in the light of his or her
personal circumstances and the financial resources available to him
or her.
Prospective investors and Shareholders should carefully consider
the risks described below before making a decision to invest in the
Company. This section contains what the Directors believe to be the
principal risk factors associated with an investment in the
Company. However, the risks listed do not purport to be an
exhaustive summary of the risks affecting the Group and are not set
out in any particular order of priority. Additional risks and
uncertainties not currently known to the Directors or which the
Directors currently deem immaterial may also have an adverse effect
on the Group. In particular, the Company's performance may be
affected by changes in market or economic conditions and in legal,
regulatory and tax requirements.
If any of the following risks were to materialise, the Company's
business, financial condition, results or future operations could
be materially adversely affected. In such cases, the market price
of the Ordinary Shares could decline and an investor may lose part
or all of his or her investment.
This announcement contains forward-looking statements that
involve risks and uncertainties. The Company's actual results could
differ materially from those anticipated in the forward-looking
statements as a result of many factors, including the risks faced
by the Company which are described below and elsewhere in this
announcement. Prospective investors and Shareholders should
carefully consider the other information in this announcement.
There can be no certainty that the Company will be able to
successfully implement its strategy. Additional risks and
uncertainties not currently known to the Directors or which the
Directors currently deem immaterial may also have an adverse effect
on the Company.
1. Risks Factors Relating to the Business and Operations of the
Group
1.1 Acceptance of the Group's products
The success of the Group will depend on the market's acceptance
of, and attribution of value to, the graphene formulations produced
by the Group based on graphene nanoplatelets produced through its
proprietary processes, formatting and the benefits of incorporating
the same into customers' products and production processes. There
can be no guarantee that this acceptance will be forthcoming, that
an acceptable value will be placed upon them or that the Group's
graphene products will succeed as an alternative to either existing
or other new products from both other producers of graphene
nanoplatelets and producers of nanomaterials.
The development of a market for the Group's products is affected
by many factors, some of which are beyond its control, including
the emergence of newer, more successful technologies and products
and the cost of production of the Group's products. Notwithstanding
the technical merits of a product developed by the Group, there can
be no guarantee that its targeted customer base for the product
will purchase or continue to purchase the product. If a market
fails to develop or develops more slowly than anticipated, the
Group may be unable to recover losses incurred in the development
of its products and may never achieve profitability. In addition,
the Directors cannot guarantee that the Group will continue to
develop, manufacture or market its products if market conditions do
not support the continuation of such products.
1.2 Early stage of operations
Whilst the Group has made initial limited product sales,
including for research and development projects with partners and
for customer evaluation, it is still at an early stage of
development. There are a number of operational, strategic and
financial risks associated with such early stage companies. In
particular, the Group's future growth and prospects will depend on
its ability to develop products with commercial partners for
applications which have sufficient commercial appeal, to manage
growth and to continue to improve operational, financial and
management information and quality control systems on a timely
basis, whilst at the same time maintaining effective cost controls.
Any failure to improve operational, financial and management
information and quality control systems in line with the Group's
growth could have a material adverse effect on its business,
financial condition and results of operations.
There can be no certainty that the Group will achieve increased
or sustained revenues, profitability or positive cash flow from its
operating activities within the timeframe expected by the Board or
at all. The development of the Group's revenues is difficult to
predict and there is no guarantee that it will generate any
material revenues in the foreseeable future. The Group has a
limited operating history upon which its performance and prospects
can be evaluated.
1.3 Commercialisation risk
The Group has, and will continue to enter into, arrangements
with third parties in respect of the development, production and
commercialisation of products based on graphene nanoplatelets where
appropriate. The Group's principal route to market is expected to
be through sampling, collaborations and product development
partnerships with companies in particular applications leading to
material supply agreements. The Group does not intend to operate
large-scale product manufacturing operations outside of the
production, formatting and preparation of graphene nanoplatelets.
The Directors believe that the strategy has the potential to reduce
risk by protecting the Group from having to incur significant
direct sales and marketing expense and by utilising the established
commercial footprint of potential future partners.
The Group's long-term success will depend both on its ability to
progress from the provision of samples for customer evaluation and
from its existing collaboration relationships to material supply
agreements and on its negotiation of appropriate terms for any
future supply agreements. Furthermore, the Group's negotiating
position in agreeing terms for either joint development or supply
may be affected by its size and limited cash resources relative to
potential development partners with substantial cash resources and
established levels of commercial success. An inability to enter
into such arrangements on favourable terms, if at all, or
disagreements between the Group and any of its potential partners
could lead to reduced payments and / or delays in the Group's
commercialisation strategy and this may have a significant adverse
effect on the Group's business, financial condition and
results.
The results of any research and development, evaluation or
collaboration activity undertaken with a partner may not meet the
required specifications or expectations of that partner or be
successful, attractive or acceptable in product trials.
Accordingly, there can be no assurance that any of the existing
evaluations or collaborations or future evaluations or
collaborations with the Group's partners will result in a material
supply arrangement with those partners on favourable terms or at
all, or that the Group will achieve significant revenues,
profitability or cash flow from such activities.
The loss of, or changes affecting, the Group's relationships
with commercialisation partners could adversely affect the Group's
results or operations and the Group will have limited input on the
product strategies adopted by any of its partners. Furthermore,
there is a risk that development partners may reprioritise within
their product portfolio resulting in the Group achieving sales
below that which the Directors anticipate. In any such arrangement,
the Group will be dependent on such partners for its revenue and
the sales strategies and product positioning of the Group's
development partners may have a material and adverse effect on the
Group's business, financial condition and results of
operations.
The Group is dependent on a relatively small number of
commercial partners. If any of these companies were to cease to
work with the Group, it could potentially have a material impact on
the trading, financial condition and prospects of the Group.
1.4 Competition and pricing risk
The Group may face significant competition from organisations
which have greater capital resources than it and / or which have a
product offering competitive to that of the Group, to the detriment
of the Group. Other companies, with varying volumes of
manufacturing capacity, are producing graphene nanoplatelets using
alternative production approaches which may be more commercially
viable than the Company's production techniques and products. At
the same time, the Group is also competing with other producers of
materials which may impede the commercial progress of graphene.
There is no assurance that the Group will be able to compete
successfully in the marketplace in which it seeks to operate.
1.5 Development of the market for graphene and the risk that
graphene will not achieve commercial success
Although there are numerous potential applications for graphene
and potentially a large global market, there is no guarantee that
graphene will become a widely accepted material for use on a
commercial scale. Even if graphene does become widely accepted, the
conversion of current interest into wide scale commercial adoption
may take longer than anticipated and the Group may also be
unsuccessful in its effort to realise commercial and financial
benefits from this wider acceptance.
1.6 Risk of competing materials
There is a risk that technological advances in existing
materials or in potential substitute materials may occur at a
faster rate than the advances of graphene, which may impede the
commercial progress of graphene. As a consequence, there could be
little or no commercial demand for graphene. This would have a
significant adverse effect on the Group's business.
1.7 Capacity of global graphene production, demand and
pricing
The commercial applications of graphene are currently limited.
The Directors believe that, at present, the aggregate global
manufacturing capacity for graphene exceeds the aggregate demand
from customers. The Directors are aware of historical situations
where new materials have been developed and the expansion of
production capacity in advance of market demand has resulted in a
decrease in the price of the material to a level where financial
returns are limited.
The development of the market for graphene is at an early stage
and there can be no assurance that demand for graphene will grow in
line with the Directors' expectations, or at all. In the event that
production capacity greatly exceeds customer demand, the Group may
not be able to negotiate favourable pricing for the supply of
graphene or its graphene-based intermediates and there is no
assurance that the Group will achieve any revenue, profitability or
cash flow from such activities.
1.8 Early stage of operations, capacity and scale up
The Group has not yet demonstrated its existing technology at
either nameplate production capacity or increased capacities and
intends to further scale up its production processes. There can be
no guarantee that scaled up production processes will be
operational to any anticipated timeframe or budget. Furthermore,
the operation of the Group's production processes following scale
up involves risks and uncertainties beyond the Group's control.
Failure to operate at either current or increased nameplate
capacities would adversely impact the Group's business and
financial position.
1.9 Plant expansion
Any delay or possible problems with the proposed expansion of
the plant and development of the Group's production processes to
increase capacity, could have an adverse effect on the financial
performance of the Group. Considerable capital expenditure will be
required for such expansion. The length of the construction period
and capital required to complete any plant expansion may be
affected by different factors, such as disputes with workers or
contractors, price increases, shortages of construction materials,
permitting requirements, technical or engineering difficulties,
accidents, suitable sites or unforeseen difficulties or changes in
government policies. Such events may give rise to delays or cost
over-runs and there can be no guarantee that the proposed projects
will be operational within the expected timeframe or within the
budgeted cost, which could have an adverse effect on the Group's
financial position and results of operations.
1.10 Operational risks and uncertainties
The operation of the Group's production facilities and
formatting at volume into customers' host materials, involves
significant risks and uncertainties beyond the Group's control,
including but not limited to:
-- the quality and consistency of the Group's graphene material
may vary unexpectedly as production volumes are increased,
resulting in lower demand for the Group's products;
-- the failure to provide adequate resources (equipment/laboratory space, personnel);
-- the attributes and properties of the Group's graphene
materials may be inadvertently affected by changes in quantities
and production techniques used as a result of the scale up,
resulting in either lower demand or lower than planned production
volumes; and
-- the application of the technology supporting the Group's
planned expansion is relatively new and therefore is subject to
higher implementation and operational risk.
The occurrence of any of these risks could significantly affect
the Group's operating results.
1.11 The Group's production processes are subject to risks
The production processes are potentially exposed to the risks of
fire, breakdown or failure of equipment, power supply or processes,
performance below expected levels of quality, consistency, output
or efficiency, obsolescence, sabotage, labour disputes, lock-outs,
potential unavailability of services of its external contractors,
natural disasters, industrial accidents and the need to comply with
the directives of relevant government authorities. The occurrence
of any of these risks could significantly affect the Group's
operating results.
1.12 The Group could be required to relocate from its premises
at short notice
The Group occupies its premises on the Wilton Science Park on
Teesside under a short term tenancy agreement, which can be
terminated at short notice by either party, although the Board has
no reason to believe that the landlord will exercise its right to
do so in the foreseeable future. In the event that the Group was
required to leave its existing premises, then the Board is
confident that alternative, appropriate premises could be found and
the Group's manufacturing facility relocated. However, such a
forced move would cause business disruption and could have a
significant effect on the Group's business in the short term.
1.13 Research and development risk
The Group is engaged in the manufacture of graphene
nanoplatelets and the preparation and formatting of these platelets
into formulations appropriate for incorporation into existing
customer products. The Company is therefore involved in complex
scientific areas and new product development and industry
experience indicates a high incidence of delay or failure to
generate results. There is no guarantee that the Group will be
successful in its research and product development, evaluation or
collaboration activities. Much of the Group's technology and
intellectual property portfolio is at an early stage of
development. The Group may not be able to develop and exploit its
technology sufficiently to enable it to develop commercial and
marketable products. Furthermore, the Group may not be able to
develop new technology solutions or identify specific market needs
that can be addressed by technology solutions developed by the
Group.
1.14 Technological advances in graphene production
Graphene production is a very active area of research and
development, and it is expected that technological advances in
graphene production will continue to occur and new technologies may
develop. Advances in the process of producing graphene
nanoplatelets or films from either graphite or carbon-containing
precursors could allow the Group's competitors to produce products
faster and more efficiently and at lower cost than the Group and
the competitors may also produce products which exhibit superior
characteristics to material produced by the Group. If the Group is
unable to adapt or incorporate technological advances into its
operations, its production facilities could become less
competitive. Further, it may be necessary for the Group to incur
significant expenditure to acquire any new technology and retrofit
its current processes in order to incorporate new technologies and
remain competitive.
1.15 Intellectual property
The Group's success will depend in part on its ability to
maintain adequate protection of its intellectual property, covering
its manufacturing process, additional processes and applications,
including in relation to the development of specific formulations
and the formatting of graphene for use in particular applications.
The intellectual property on which the Group's business is based is
a combination of patent applications and proprietary know-how. No
assurance can be given that any pending patent applications or any
future patent applications will result in granted patents, that any
patents will be granted on a timely basis, that the scope of any
patent protection will exclude competitors or provide competitive
advantages to the Group, that any of the Group's patents will be
held valid if challenged, or that third parties will not claim
rights in, or ownership of, the patents and other proprietary
rights held by the Group. There is a risk that certain comments or
objections which have been raised by patent offices, in relation to
the patent applications which have been filed by the Group, may
prevent those patent applications from being granted or may result
in a patent being granted, the scope of which is less than
originally applied for.
Further, there can be no assurance that others have not
developed or will not develop similar products, duplicate any of
the Group's products or design around any patent applications held
by the Group. Others may hold or receive patents which contain
claims having a scope that covers products developed by the Group
(whether or not patents are issued to the Group). In addition, no
assurance can be given that others will not independently develop
or otherwise acquire substantially equivalent techniques or
otherwise gain access to the Company's unpatented proprietary
technology and know-how or disclose such technology or that the
Company can ultimately protect meaningful rights to such unpatented
technology.
Once granted, a patent can be challenged both in the relevant
patent office and in the courts by third parties. Third parties can
bring material and arguments which the patent office granting the
patent may not have seen. Therefore, issued patents may be found by
a court of law or by the patent office to be invalid or
unenforceable or in need of further restriction.
A substantial cost may be incurred if the Group is required to
assert its intellectual property rights, including any patents
against third parties. Patent litigation is costly and time
consuming and there can be no assurance that the Group will have,
or will be able to devote, sufficient resources to pursue such
litigation. Potentially unfavourable outcomes in such proceedings
could limit the Group's intellectual property rights and
activities. There is no assurance that obligations to maintain the
Group's or partners' know-how would not be breached or otherwise
become known in a manner which provides the Group with no
recourse.
Any claims made against the Group's intellectual property
rights, even without merit, could be time consuming and expensive
to defend and could have a materially detrimental effect on the
Group's resources. A third party asserting infringement claims
against the Group and its customers could require the Group to
cease the infringing activity and / or require the Group to enter
into licensing and royalty arrangements. The third party could also
take legal action which could be costly to defend. In addition, the
Group may be required to develop alternative non-infringing
solutions that may require significant time and substantial
unanticipated resources. There can be no assurance that such claims
would not have a material adverse effect on the Group's business,
financial condition or results.
If the patent applications are not granted, the consequence is
that the techniques and processes described in the patent
applications would not be protected and would be in the public
domain. The Group would then continue to rely on the confidential
know-how it has developed, including process operating conditions
and in related, ancillary or other processes, and techniques it
uses, such as the techniques it has developed for the dispersion
and formatting of graphene nanoplatelets. In addition, the Group
would pursue new patent applications for such related, ancillary
and other processes and techniques it has developed.
In cases of proprietary know-how the Company takes reasonable
steps to protect this knowledge through a combination of
confidentiality agreements and contracts. However, there can be no
guarantee that an individual or business would not use or disclose
such information to a third party that would be beneficial to them.
In the event that the Company becomes aware of any such disclosure
it may opt to take legal action to defend its position, although
this may be costly and / or time consuming.
1.16 Third party intellectual property
Although the Board believes that the Group's current products,
products in development and processes do not infringe the
intellectual property rights of any third parties, it is impossible
to be aware of all third party intellectual property. No assurance
can be given that third parties will not in the future claim rights
in, or ownership of, the patents and other proprietary rights from
time to time held by the Group. As further detailed above,
substantial costs (both financially and in management time) may be
incurred if the Group is required to defend its intellectual
property.
1.17 Management of growth
The ability of the Group to implement its strategy requires
effective planning along with robust financial and management
control systems. The Group's growth plans may place a significant
strain on its management and operational, financial and personnel
resources. Therefore, the Group's future growth and prospects will
depend on its ability to manage this growth.
The value of an investment in the Company is dependent upon the
Company achieving the aims set out in this announcement. There can
be no guarantee that the Company will achieve the level of success
that the Board expects.
1.18 Dependence on key executives and personnel and the ability
to attract and retain appropriately qualified personnel
The Group's future success is substantially dependent on the
continued services and performance of its executive Directors and
senior management and its ability to attract and retain suitably
skilled and experienced personnel. Whilst the Group has entered
into employment or secondment arrangements with each of its key
personnel with the aim of securing their services, the Directors
cannot give assurances that members of the senior management team
and the executive Directors will continue to remain within the
Group. The loss of the services of any of the executive Directors,
members of senior management, secondees or other key employees
could have a material adverse effect upon the Group's business and
results of operations. Finding and hiring any such replacements
could be costly and might require the Company to grant significant
equity awards or other incentive compensation, which could
adversely impact its financial results.
Furthermore, the nature of the business means that there is
likely to be a need to ensure that the Company retains sufficiently
qualified personnel to capitalise on this evolving technology.
Failure to invest in personnel through training, communication,
planning and adequate resourcing may have an adverse impact on the
business as the Company may not possess adequate or sufficient
skills to capitalise on any developments.
1.19 Health, safety and environmental risks
The Group's operations are and will be subject to numerous
health, safety and environmental ("HSE") requirements in the
jurisdictions in which the Group conducts its business. Such HSE
laws and regulations govern, among other matters, air emissions,
wastewater discharges, solid and hazardous waste management and the
use, composition, handling, distribution and transportation of
hazardous materials. Many HSE laws and regulations are becoming
increasingly stringent (and may impose strict liability) and the
cost of compliance with these requirements can be expected to
increase over time. Although the Directors believe that the Group's
procedures comply with applicable regulations, any failure to
comply with HSE laws and regulations could result in the Group
incurring costs and / or liabilities, including as a result of
regulatory enforcement, personal injury, property damage and claims
and litigation resulting from such events, which could adversely
affect the Group's results of operations and financial condition.
Failure to comply with HSE requirements of jurisdictions elsewhere
in the world may result in the Group being unable to supply
products to customers located in those jurisdictions.
Accidents or mishandling involving hazardous substances could
cause severe or critical damage or injury to property and human
health. Such an event could result in civil lawsuits and / or
regulator enforcement proceedings, both of which could lead to
significant liabilities. Any damage to persons, equipment or
property or other disruption of the Group's business could result
in significant additional costs to replace, repair and insure the
Group's assets, which could negatively affect the Group's business,
prospects, operating results and financial condition.
The Group cannot predict the impact of new or changed HSE laws
or regulations or other concerns or changes in the ways that such
laws or regulations are administered, interpreted or enforced. The
requirements to be met, as well as the technology and length of
time available to meet those requirements, continue to develop and
change. To the extent that any of the requirements impose
substantial costs or constrain the Group's ability to expand or
change its processes, the Group's business, prospects, operating
results and financial condition may suffer as a result.
The Group is aware that it will require a permit from the
Environment Agency in respect of the commercial production of
graphene. The Group has submitted an appropriate application for
such a permit at the appropriate time. Furthermore, additional
permits may be required for the purposes of operating within or
supplying into overseas territories. The Directors are not aware of
any reason why such permits would not be granted, however, there is
no guarantee that such permits would be granted and failure to
obtain such permits would have a significant adverse effect on the
business of the Group.
1.20 Safety of handling graphene
Graphene is a relatively new material with a limited number of
studies into its effects on biological systems. Carbon nanotubes
("CNTs") are a material closely related to graphene. There have
been concerns raised recently over the potential toxicity of CNTs,
with much of the concern related to their fibre-like geometry,
potentially allowing them to penetrate cell membranes. In 2013, the
UK Health and Safety Executive published a guide to using CNTs and
other high aspect ratio nanomaterials ("HARNs") in the workplace,
which outlines regulatory requirements, handling procedures and
risk management protocols for the manufacture, handling, storage
and shipping of these materials. Whilst graphene is not a fibre due
to its extended planar geometry, the Directors believe that the
Group is acting prudently by following the Health and Safety
Executive guidelines for the handling of HARNs in its procedures
for handling graphene nanoplatelets.
However, there is no guarantee that evidence will not emerge
that graphene has a deleterious effect on biological systems, which
may limit the potential applications of graphene nanoplatelets,
require the Group to expend additional funds on safety measures,
and potentially have a material adverse effect on the Group's
business, financial position or prospects.
1.21 Insurance
There can be no certainty that the Group's insurance cover is
adequate to protect against every eventuality. The occurrence of an
event for which the Group did not have adequate insurance cover
could have a material adverse effect on the business, financial
condition and results of operations of the Group.
1.22 Product liability
Some of the Group's product and pipeline product applications
are designed for use in industries which are highly regulated.
There is a risk that the Group may lose contracts or could be
subject to fines or penalties for any non-compliance with the
relevant industry regulations. Furthermore, there is a risk of
litigation and reputational damage, as well as product liability
and indemnity risks.
1.23 Disaster recovery
The Group depends on the performance, reliability and
availability of its plant, equipment and information technology
systems. Any damage to, or failure of, its equipment and / or
systems could result in disruptions to the Group's operations. The
Group's disaster recovery plans may not adequately address every
potential event and its insurance policies may not cover any loss
in full or in part (including losses resulting from business
interruptions) or damage that it suffers fully or at all, which
could have a material adverse effect on the Group's business,
financial position or prospects.
1.24 The expenditure required by the Group may be more than
currently anticipated
There is a risk that the amount that the Group anticipates will
be needed to fund its growth will be insufficient, that the
anticipated timing of such investment may prove incorrect or that
the Group may be unable to raise the amounts required (if at all).
Costs may be greater than planned, or timings may vary from those
targeted, which could have a material adverse effect on the
implementation of the Group's strategy and its business, financial
condition and results of operations.
The proceeds of the Fundraising are expected to be sufficient to
implement the Board's strategy. However, if the Group fails to
generate sufficient cash through the sale of its products, it may
need to raise additional capital in the future, whether from equity
or debt sources, to fund expansion, development and / or the
ongoing operating costs of the Group. If the Group is unable to
obtain this financing on terms acceptable to it then it may be
forced to curtail its planned development. If additional funds are
raised through the issue of new equity or equity-linked securities
of the Company other than on a pre-emptive basis to then existing
shareholders, the percentage ownership of such shareholders may be
substantially diluted.
1.25 Counterparty risk
There is a risk that parties with whom the Group trades or has
other business relationships (including partners, customers,
suppliers and other parties) may become insolvent. This may be as a
result of general economic conditions or factors specific to that
company. In the event that a party with whom the Group trades
becomes insolvent, this could have an adverse impact on the
revenues and profitability of the Group.
1.26 Security of intellectual property and the threat of
cyber-attack
Through its research and development activities and operations,
the Group holds significant intellectual property. As such, there
is a risk that its information technology systems could be subject
to cyber-attack and result in the misappropriation or loss of key
information. Should this occur, it is highly unlikely that the
Group will have recourse against the perpetrators of such an attack
or be able to take legal action against another business using this
information to its advantage (where not protected by patents).
1.27 Reputational risk
Since its discovery there has been significant interest in
graphene both within the media and amongst the wider public. As
with any business there is a risk that certain comments made by
third parties in a public domain pertaining to the industry as a
whole or the business may be incorrect, inappropriate and/or
negative in their tone. Adverse publicity may have a negative
impact on the Company regardless of its accuracy and ultimately
this could impinge on the overall business.
2. General risks
2.1 Economic conditions and current economic weakness
Any economic downturn either globally or locally in any area in
which the Group operates may have an adverse effect on the demand
for the Group's products and on the attitude of its customers to
participate in collaborations with the Group and to use its
products. A more prolonged economic downturn may prevent growth
and/or lead to an overall decline in the volume of the Group's
sales, restricting the Group's ability to deliver a profit. In
addition, although signs of economic recovery have been perceptible
in certain countries, the sustainability of a global economic
upturn is not yet assured and the Directors consider that the
current level of market risk is higher than normal given
geo-political unrest and the United Kingdom's withdrawal from the
European Union. If economic conditions remain uncertain, the Group
might see lower levels of growth than in the past, which could have
an adverse impact on the Group's operations and business
results.
2.2 Changes in tax laws or their interpretation could affect the
Group's financial condition or prospects
The nature and amount of tax which members of the Group expect
to pay and the reliefs expected to be available to any member of
the Group are each dependent upon a number of assumptions, any one
of which may change and which would, if so changed, affect the
nature and amount of tax payable and reliefs available. In
particular, the nature and amount of tax payable is dependent on
the availability of relief under tax treaties in a number of
jurisdictions and is subject to changes to the tax laws or practice
in any of the jurisdictions affecting the Group. Any limitation in
the availability of relief under these treaties, any change in the
terms of any such treaty or any changes in tax law, interpretation
or practice could increase the amount of tax payable by the
Group.
3. Risks relating to the Ordinary Shares
3.1 Investment risk
An investment in a share which is traded on AIM, such as the
Ordinary Shares, may be difficult to realise and carries a high
degree of risk. The ability of an investor to sell Ordinary Shares
will depend on there being a willing buyer for them at an
acceptable price. Consequently, it might be difficult for an
investor to realise his/her investment in the Group and he/she may
lose all of his/her investment.
Investors should be aware that the market price of the Ordinary
Shares may be volatile and may go down as well as up and investors
may therefore be unable to recover their original investment and
could even lose their entire investment. This volatility could be
attributable to various factors and events, including the
availability of information for determining the market value of an
investment in the Group, any regulatory or economic changes
affecting the Group's operations, variations in the Group's
operating results, developments in the Group's business or its
competitors, or changes in market sentiment towards the Ordinary
Shares. In addition, the Group's operating results and prospects
from time to time may be below the expectations of market analysts
and investors.
Market conditions may affect the Ordinary Shares regardless of
the Group's operating performance or the overall performance of the
sector in which the Group operates. Share market conditions are
affected by many factors, including general economic outlook,
movements in or outlook on interest rates and inflation rates,
currency fluctuations, commodity prices, changes in investor
sentiment towards particular market sectors and the demand and
supply for capital. Accordingly, the market price of the Ordinary
Shares may not reflect the underlying value of the Group's net
assets, or its trading performance and the price at which investors
may dispose of their Ordinary Shares at any point in time may be
influenced by a number of factors, only some of which may pertain
to the Group while others of which may be outside of the Group's
control.
If the Group's revenues do not grow, or grow more slowly than
anticipated, or if its operating or capital expenditures exceed
expectations and cannot be adjusted sufficiently, the market price
of its Ordinary Shares may decline. In addition, if the market for
the securities of companies in the same sector or the stock market
in general experiences a loss in investor confidence or otherwise
falls, the market price of the Ordinary Shares may fall for reasons
unrelated to the Group's business, results of operations or
financial condition. Therefore, investors might be unable to resell
their Ordinary Shares at or above the Issue Price.
3.2 Future need for access to capital
The Group may need to raise further funds to carry out the
implementation of its business plan. Any additional equity
financing may be dilutive to Shareholders, and debt financing, if
available, may involve restrictions in financing and operating
activities. In addition, there can be no assurance that the Group
will be able to raise additional funds when needed or that such
funds will be available on terms favourable to it. If the Group is
unable to obtain additional financing as needed it may be required
to reduce the scope of its operations or anticipated expansion or
cease trading.
3.3 Investment in publicly quoted securities
Investment in securities traded on AIM is perceived to involve a
higher degree of risk and be less liquid than investment in
companies whose securities are listed on the "Official List" of the
FCA in the UK and traded on the London Stock Exchange's main market
for listed securities. An investment in the Ordinary Shares traded
on AIM may be difficult to realise. AIM has been in existence since
1995 and is a market designed for small and growing companies, but
its future success and liquidity as a market for Ordinary Shares
cannot be guaranteed.
3.4 Potentially volatile share price and liquidity
The share prices of companies quoted on AIM can be highly
volatile and shareholdings illiquid. The price at which the
Ordinary Shares are quoted and the price at which investors may
realise their investment in the Company may be influenced by a
significant number of factors, some specific to the Company and its
operations and some which affect quoted companies generally.
These factors could include the performance of the Company,
large purchases or sales of Ordinary Shares, legislative changes
and general economic, political or regulatory conditions.
4. Risks relating to the Open Offer
4.1 Shareholders will experience dilution in their ownership of
the Company
Shareholders will experience dilution in their ownership of, and
voting interest in, the Company as a result of the Placing.
Shareholders will experience greater dilution in their ownership
of, and voting interest in, the Company to the extent they do not
subscribe in full for their Basic Entitlement under the Open
Offer.
4.2 Overseas Shareholders may not be eligible to participate in
the Open Offer
Securities laws of certain jurisdictions may restrict the
Company's ability to allow participation by Overseas Shareholders
in the Open Offer. In particular, holders of Ordinary Shares who
are located in the US may not be able to exercise their pre-emption
rights unless a registration statement under the Securities Act is
effective with respect to such rights or an exemption from the
registration requirements is available thereunder. The Open Offer
will not be registered under the Securities Act.
Securities laws of certain other jurisdictions may restrict the
Company's ability to allow participation by Shareholders in such
jurisdictions in any future issue of shares carried out by the
Company.
APPIX - TERMS AND CONDITIONS OF THE PLACING
IMPORTANT INFORMATION FOR INVITED PLACEES ONLY REGARDING THE
PLACING.
THIS ANNOUNCEMENT, INCLUDING THIS APPIX AND THE INFORMATION
CONTAINED HEREIN (TOGETHER THE "ANNOUNCEMENT") 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, THE
REPUBLIC OF IRELAND, AUSTRALIA, CANADA, JAPAN, THE REPUBLIC OF
SOUTH AFRICA OR ANY OTHER JURISDICTION IN WHICH SUCH RELEASE,
PUBLICATION OR DISTRIBUTION WOULD BE UNLAWFUL. THIS ANNOUNCEMENT
HAS NOT BEEN APPROVED BY THE LONDON STOCK EXCHANGE, NOR IS IT INTED
THAT IT WILL BE SO APPROVED.
MEMBERS OF THE PUBLIC ARE NOT ELIGIBLE TO TAKE PART IN THE
PLACING. THIS ANNOUNCEMENT IS FOR INFORMATION PURPOSES ONLY AND IS
DIRECTED ONLY AT: (A) PERSONS IN MEMBER STATES OF THE EUROPEAN
ECONOMIC AREA ("EEA") WHO ARE QUALIFIED INVESTORS AS DEFINED IN
SECTION 86(7) OF THE FINANCIAL SERVICES AND MARKETS ACT 2000
("FSMA"), AS AMED ("QUALIFIED INVESTORS"), BEING PERSONS FALLING
WITHIN THE MEANING OF ARTICLE 2(1)(e) OF DIRECTIVE 2003/71/EC AS
AMED, INCLUDING BY THE 2010 PROSPECTUS DIRECTIVE AMING DIRECTIVE
(DIRECTIVE 2010/73/EC) AND TO THE EXTENT IMPLEMENTED IN THE
RELEVANT MEMBER STATE (THE "PROSPECTUS DIRECTIVE"); AND (B) IN THE
UNITED KINGDOM, QUALIFIED INVESTORS WHO ARE PERSONS WHO (I) HAVE
PROFESSIONAL EXPERIENCE IN MATTERS RELATING TO INVESTMENTS FALLING
WITHIN ARTICLE 19(5) (INVESTMENT PROFESSIONALS) OF THE FSMA
(FINANCIAL PROMOTION) ORDER 2005, AS AMED (THE "ORDER"); (II) ARE
PERSONS FALLING WITHIN ARTICLE 49(2)(A) TO (D) (HIGH NET WORTH
COMPANIES, UNINCORPORATED ASSOCIATIONS, ETC.) OF THE ORDER; OR
(III) ARE PERSONS TO WHOM IT MAY OTHERWISE BE LAWFULLY COMMUNICATED
(ALL SUCH PERSONS TOGETHER BEING REFERRED TO AS "RELEVANT
PERSONS").
THIS ANNOUNCEMENT AND THE INFORMATION IN IT MUST NOT BE ACTED ON
OR RELIED ON BY PERSONS WHO ARE NOT RELEVANT PERSONS. PERSONS
DISTRIBUTING THIS ANNOUNCEMENT MUST SATISFY THEMSELVES THAT IT IS
LAWFUL TO DO SO. ANY INVESTMENT OR INVESTMENT ACTIVITY TO WHICH
THIS ANNOUNCEMENT RELATES IS AVAILABLE ONLY TO RELEVANT PERSONS AND
WILL BE ENGAGED IN ONLY WITH RELEVANT PERSONS. THIS ANNOUNCEMENT
DOES NOT ITSELF CONSTITUTE AN OFFER FOR SALE OR SUBSCRIPTION OF ANY
SECURITIES IN APPLIED GRAPHENE MATERIALS.
THIS ANNOUNCEMENT IS NOT AN OFFER OF SECURITIES FOR SALE INTO
THE UNITED STATES. THE PLACING SHARES HAVE NOT BEEN AND WILL NOT BE
REGISTERED UNDER THE UNITED STATES SECURITIES ACT 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. SUBJECT TO CERTAIN
EXCEPTIONS AND AT THE SOLE DISCRETION OF THE COMPANY, THE PLACING
SHARES ARE BEING OFFERED AND SOLD ONLY OUTSIDE THE UNITED STATES IN
"OFFSHORE TRANSACTIONS" WITHIN THE MEANING OF, AND IN ACCORDANCE
WITH, REGULATION S UNDER THE SECURITIES ACT AND OTHERWISE IN
ACCORDANCE WITH APPLICABLE LAWS. NO PUBLIC OFFERING OF THE PLACING
SHARES IS BEING MADE IN THE UNITED STATES, THE UNITED KINGDOM OR
ELSEWHERE. NO MONEY, SECURITIES OR OTHER CONSIDERATION FROM ANY
PERSON INSIDE THE UNITED STATES IS BEING SOLICITED AND, IF SENT IN
RESPONSE TO THE INFORMATION
CONTAINED IN THIS ANNOUNCEMENT, WILL NOT BE ACCEPTED.
EACH PLACEE SHOULD CONSULT WITH ITS ADVISERS AS TO LEGAL, TAX,
BUSINESS AND RELATED ASPECTS OF AN INVESTMENT IN PLACING SHARES.
THE DISTRIBUTION OF THIS ANNOUNCEMENT, ANY PART OF IT OR ANY
INFORMATION CONTAINED IN IT MAY BE RESTRICTED BY LAW IN CERTAIN
JURISDICTIONS, AND ANY PERSON INTO WHOSE POSSESSION THIS
ANNOUNCEMENT, ANY PART OF IT OR ANY INFORMATION CONTAINED IN IT
COMES SHOULD INFORM THEMSELVES ABOUT, AND OBSERVE, SUCH
RESTRICTIONS.
No action has been taken by the Company, N+1 Singer 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.
This Announcement or any part of it does not constitute or form
part of any offer to issue or sell, or the solicitation of an offer
to acquire, purchase or subscribe for, any securities in the United
States (including its territories and possessions, any state of the
United States and the District of Columbia), Canada, the Republic
of Ireland, Australia, the Republic of South Africa, Japan or any
other jurisdiction in which the same would be unlawful. No public
offering of the Placing Shares is being made in any such
jurisdiction.
All offers of the Placing Shares will be made pursuant to an
exemption under the Prospectus Directive 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 the 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 Fundraising 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
offering in compliance with the securities laws of any state,
province or territory of Australia, Canada, Japan or 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 or 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 obligations to forward
a copy of this Announcement should seek appropriate advice before
taking any action.
This Announcement should be read in its entirety. In particular,
you should read and understand the information provided in this
"Important Information" section of this Announcement.
By participating in the Placing, each person who is invited to
and who chooses to participate in the Placing (a "Placee") will be
deemed to have read and understood this Announcement in its
entirety, to be participating, making an offer and acquiring
Placing Shares on the terms and conditions contained herein and to
be providing the representations, warranties, indemnities,
acknowledgements and undertakings contained in this Appendix.
In particular, each such Placee represents, warrants,
undertakes, agrees and acknowledges (amongst other things)
that:
1 it is a Relevant Person and undertakes that it will acquire,
hold, manage or dispose of any Placing Shares that are allocated to
it for the purposes of its business;
2 in the case of a Relevant Person in a member state of the EEA
which has implemented the Prospectus Directive (each, a "Relevant
Member State") who acquires any Placing Shares pursuant to the
Placing:
2.1 it is a Qualified Investor within the meaning of Article
2(1)(e) of the Prospectus Directive;
2.2 in the case of any Placing Shares acquired by it as a
financial intermediary, as that term is used in Article 3(2) of the
Prospectus Directive:
2.2.1 the Placing Shares acquired by it in the Placing have not
been acquired on behalf of, nor have they been acquired with a view
to their offer or resale to, persons in any Relevant Member State
other than Qualified Investors or in circumstances in which the
prior consent of N+1 Singer has been given to the offer or resale;
or
2.2.2 where Placing Shares have been acquired by it on behalf of
persons in any member state of the EEA other than Qualified
Investors, the offer of those Placing Shares to it is not treated
under the Prospectus Directive 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 exercises sole investment discretion and has the authority to
make and does make the representations, warranties, indemnities,
acknowledgements, undertakings and agreements contained in this
Announcement;
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; and
5 except as otherwise permitted by the Company and subject to
any available exemptions from applicable securities laws, it (and
any account referred to in paragraph 3 above) is outside the United
States acquiring the Placing Shares in offshore transactions as
defined in and in accordance with Regulation S under the Securities
Act.
No prospectus
No prospectus or other offering document has been or will be
submitted to be approved by the Financial Conduct Authority ("FCA")
in relation to the Fundraising or the Placing Shares and Placees'
commitments will be made solely on the basis of the information
contained in this Announcement and any information publicly
announced through a Regulatory Information Service (as defined in
the AIM Rules for Companies) by or on behalf of the Company on or
prior to the date of this Announcement (the "Publicly Available
Information") and subject to any further terms set forth in the
form of confirmation to be sent to individual Placees.
Each Placee, by participating in the Placing, agrees that the
content of this Announcement is exclusively the responsibility of
the Company and confirms that it has neither received nor relied on
any information (other than the Publicly Available Information),
representation, warranty or statement made by or on behalf of N+1
Singer, the Company or any other person and none of N+1 Singer, the
Company or any other person acting on such person's behalf nor any
of their respective affiliates has or shall have any liability for
any Placee's decision to participate in the Placing based on any
other information, representation, warranty or statement. Each
Placee acknowledges and agrees that it has relied on its own
investigation of the business, financial or other position of the
Company in accepting a participation in the Placing. Nothing in
this paragraph shall exclude the liability of any person for
fraudulent misrepresentation.
Details of the Placing Agreement and the Placing Shares
N+1 Singer has today entered into a placing agreement (the
"Placing Agreement") with the Company under which, on the terms and
subject to the conditions set out in the Placing Agreement, N+1
Singer, as agent for and on behalf of the Company, has agreed to
use its reasonable endeavours to procure Placees for the Placing
Shares at the Issue Price.
The Placing Shares will, when issued, be subject to the articles
of association of the Company and credited as fully paid and will
rank pari passu in all respects with the Existing Ordinary Shares
in the capital of the Company, including the right to receive all
dividends and other distributions declared, made or paid in respect
of such Ordinary Shares after the date of issue of the Placing
Shares.
Application for admission to trading
Application will be made to the London Stock Exchange for
admission of the Placing Shares to trading on AIM.
It is expected that Admission will take place no later than 8.00
a.m. on 31 October 2017 and that dealings in the Placing Shares on
AIM will commence at the same time.
Principal terms of the Placing
1 N+1 Singer is acting as nominated adviser, placing agent, sole
bookrunner and broker to the Fundraising, as agent for and on
behalf of the Company. N+1 Singer is authorised and regulated in
the United Kingdom by the FCA and is acting exclusively for the
Company and no one else in connection with the matters referred to
in this Announcement and will not be responsible to anyone other
than the Company for providing the protections afforded to the
customers of N+1 Singer or for providing advice in relation to the
matters described in this Announcement.
2 Participation in the Placing will only be available to persons
who may lawfully be, and are invited by N+1 Singer to participate.
N+1 Singer and any of its respective affiliates are entitled to
participate in the Placing as principal.
3 The price per Placing Share (the "Issue Price") is a minimum
of 36 pence and is payable to N+1 Singer (as agent of the Company)
by all Placees.
4 Each Placee's allocation is determined by N+1 Singer in its
discretion following consultation with the Company and has been or
will be confirmed orally by N+1 Singer and a form of confirmation
will be dispatched as soon as possible thereafter. That oral
confirmation will give rise to an irrevocable, legally binding
commitment by that person (who at that point becomes a Placee), in
favour of N+1 Singer and the Company, under which it agrees to
acquire the number of Placing Shares allocated to the Placee at the
Issue Price and otherwise on the terms and subject to the
conditions set out in this Appendix and in accordance with the
Company's articles of association. Except with N+1 Singer's written
consent, such commitment will not be capable of variation or
revocation at the time at which it is submitted.
5 Each Placee's allocation and commitment will be evidenced by a
form of confirmation issued to such Placee by N+1 Singer. The terms
of this Appendix will be deemed incorporated in that form of
confirmation.
6 Each Placee will have an immediate, separate, irrevocable and
binding obligation, owed to N+1 Singer (as agent for the Company),
to pay to it (or as it may direct) in cleared funds an amount equal
to the product of the Issue Price and the number of Placing Shares
such Placee has agreed to acquire and the Company has agreed to
allot and issue to that Placee.
7 Irrespective of the time at which a Placee's allocation(s)
pursuant to the Placing is/are confirmed, settlement for all
Placing Shares to be acquired pursuant to the Placing will be
required to be made at the same time, on the basis explained below
under "Registration and Settlement".
8 All obligations of N+1 Singer 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 "Termination of the
Placing".
9 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 and will not be capable
of rescission or termination by the Placee.
10 To the fullest extent permissible by law and applicable FCA
rules, none of (a) N+1 Singer, (b) any of N+1 Singer's affiliates,
agents, directors, officers, consultants, (c) to the extent not
contained within (a) or (b), any person connected with N+1 Singer
as defined in the FSMA ((b) and (c) being together "affiliates" and
individually an "affiliate" of N+1 Singer), (d) any person acting
on N+1 Singer's behalf, shall have any liability (including to the
extent permissible by law, any fiduciary duties) to Placees or to
any other person whether acting on behalf of a Placee or otherwise.
In particular, neither N+1 Singer nor any of its respective
affiliates shall have any liability (including, to the extent
permissible by law, any fiduciary duties) in respect of their
conduct of the Fundraising or of such alternative method of
effecting the Fundraising as N+1 Singer and the Company may
agree.
Registration and Settlement
If Placees are allocated any Placing Shares in the Placing they
will be sent a form of confirmation or electronic confirmation by
N+1 Singer, as soon as it is able which will confirm the number of
Placing Shares allocated to them, the Issue Price and the aggregate
amount owed by them to N+1 Singer.
Each Placee will be deemed to agree that it will do all things
necessary to ensure that delivery and payment is completed as
directed by N+1 Singer in accordance with either the standing CREST
or certificated settlement instructions which they have in place
with N+1 Singer.
Settlement of transactions in the Placing Shares (ISIN:
GB00BFSSB742) following Admission will take place within the CREST
system, subject to certain exceptions. Settlement through CREST is
expected to take place on 31 October 2017 unless otherwise notified
by N+1 Singer and Admission is expected to occur no later than 8.00
a.m. on 31 October 2017 unless otherwise notified by N+1 Singer.
Admission and settlement may occur at an earlier date, which if
achievable, will be set out in the Circular. Settlement will be on
a delivery versus payment basis. However, in the event of any
difficulties or delays in the admission of the Placing Shares to
CREST or the use of CREST in relation to the Placing, the Company
and N+1 Singer may agree that the Placing Shares should be issued
in certificated form. N+1 Singer reserves the right to require
settlement for the Placing Shares, and to deliver the Placing
Shares to Placees, by such other means as they deem necessary if
delivery or settlement to Placees is not practicable within the
CREST system or would not be consistent with regulatory
requirements in a Placee's jurisdiction.
Interest is chargeable daily on payments not received from
Placees on the due date in accordance with the arrangements set out
above, in respect of either CREST or certificated deliveries, at
the rate of 2 percentage points above prevailing LIBOR as
determined by N+1 Singer.
Each Placee agrees that if it does not comply with these
obligations, N+1 Singer may sell, charge by way of security (to any
funder of N+1 Singer) or otherwise deal with any or all of their
Placing Shares on their behalf and retain from the proceeds, for
N+1 Singer's own account and benefit, an amount equal to the
aggregate amount owed by the Placee plus any interest due and any
costs and expenses properly incurred by N+1 Singer as a result of
the Placee's failure to comply with its obligations. The relevant
Placee will, however, remain liable for any shortfall below the
amount owed by it and for any stamp duty or stamp duty reserve tax
(together with any interest or penalties) which may arise upon the
sale of their Placing Shares on their behalf. Legal and / or
beneficial title in and to any Placing Shares shall not pass to the
relevant Placee until such time as it has fully complied with its
obligations hereunder
If Placing Shares are to be delivered to a custodian or
settlement agent, Placees must ensure that, upon receipt, the
conditional 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 United Kingdom stamp duty or stamp duty
reserve tax. Placees will not be entitled to receive any fee or
commission in connection with the Placing.
Conditions of the Placing
The Placing is conditional upon the Placing Agreement becoming
unconditional and not having been terminated in accordance with its
terms.
The obligations of N+1 Singer under the Placing Agreement are,
and the Placing is, conditional upon, inter alia:
(a) the passing of the Resolutions (without any amendment which
has not been previously approved by N+1 Singer) at the General
Meeting (or any adjournment thereof);
(b) each of the warranties contained in the Placing Agreement
being and remaining true, accurate and not misleading until
Admission;
(c) the Company having complied in all material respects with
its obligations and having satisfied the conditions under the
Placing Agreement which fall to be performed or satisfied prior to
Admission;
(d) the Placing Agreement not having been terminated by N+1
Singer in accordance with its terms;
(e) the Company procuring that a Circular and Form of Proxy are
sent to each Qualifying Shareholder and a Circular and Form of
Proxy are sent to Overseas Shareholders who have notified an
address in the United Kingdom for the service of documents in
accordance with the articles of association and an Application Form
is sent to each Qualifying non-CREST Shareholder;
(f) the Open Offer Entitlements being admitted as a
participating security (as defined in the CREST Regulations) to
CREST; the Open Offer Entitlements being credited to the CREST
stock accounts of Qualifying CREST Shareholders in the proportions
set out in the Circular; and the Open Offer Entitlements becoming
enabled for settlement within CREST, in each case by not later than
the Business Day following the date of posting of the Circular;
and
(g) Admission occurring by not later than 8.00 a.m. on 31
October 2017 (or such later date as the Company and N1 Singer may
agree in writing, in any event being not later than the Long Stop
Date);
(all conditions to the obligations of N+1 Singer included in the
Placing Agreement being together, the "conditions").
If any of the conditions set out in the Placing Agreement are
not fulfilled or, where permitted, waived in accordance with the
Placing Agreement within the stated time periods (or such later
time and/or date as the Company and N+1 Singer may agree, provided
that the time for satisfaction of the condition set out in (f)
above shall not be extended beyond 8.00 a.m. on 30 November 2017),
or the Placing Agreement is terminated in accordance with its
terms, the Fundraising will lapse and the Placee's rights and
obligations shall cease and terminate at such time and each Placee
agrees that no claim can be made by or on behalf of the Placee (or
any person on whose behalf the Placee is acting) in respect
thereof.
By participating in the Placing, each Placee agrees that its
rights and obligations cease and terminate only in the
circumstances described above and under "Termination of the
Fundraising" below and will not be capable of rescission or
termination by it.
Certain conditions may be waived in whole or in part by N+1
Singer, in its absolute discretion by notice in writing to the
Company and N+1 Singer may also agree in writing with the Company
to extend the time for satisfaction of any condition. Any such
extension or waiver will not affect Placees' commitments as set out
in this Announcement.
N+1 Singer may terminate the Placing Agreement in certain
circumstances, details of which are set out below.
Neither N+1 Singer, the Company nor any of their respective
affiliates, agents, directors, officers or employees shall have any
liability to any Placee (or to any other person whether acting on
behalf of a Placee or otherwise) in respect of any decision any of
them may make as to whether or not to waive or to extend the time
and/or date for the satisfaction of any condition to the Placing
nor for any decision any of them may make as to the satisfaction of
any condition or in respect of the Placing generally and by
participating in the Placing each Placee agrees that any such
decision is within the absolute discretion of N+1 Singer.
Termination of the Fundraising
N+1 Singer may terminate the Placing Agreement, in accordance
with its terms, at any time prior to Admission if, inter alia:
1 any of the warranties and undertakings in the Placing
Agreement were untrue or inaccurate in any material aspect, or were
misleading when given or deemed given; or
2 the Company fails to comply with its obligations under the
Placing Agreement or the terms of the Fundraising, which N+1 Singer
considers material in the context of the Fundraising; or
3 any statement contained in the Issue Documents is or has
become untrue, inaccurate or misleading in any respect or a matter
has arisen which would constitute a material omission from the
Issue Document; or
4 there has occurred a force majeure event, or any material
adverse change has occurred in the condition, earnings, business
affairs or business prospects of the Company and its subsidiary
undertakings (taken as whole).
If the Placing Agreement is terminated in accordance with its
terms, the rights and obligations of each Placee in respect of the
Placing as described in this Announcement shall cease and terminate
at such time and no claim can be made by any Placee in respect
thereof.
By participating in the Placing, each Placee agrees with the
Company and N+1 Singer that the exercise by the Company or N+1
Singer of any right of termination or any other right or other
discretion under the Placing Agreement shall be within the absolute
discretion of the Company or N+1 Singer and that neither of the
Company nor N+1 Singer need make any reference to such Placee and
that neither N+1 Singer, the Company, nor any of their respective
affiliates, agents, directors, officers or employees shall have any
liability to such Placee (or to any other person whether acting on
behalf of a Placee or otherwise) whatsoever in connection with any
such exercise.
By participating in the Placing, each Placee agrees that its
rights and obligations terminate only in the circumstances
described above and under the "Conditions of the Fundraising"
section above and will not be capable of rescission or termination
by it after the issue by N+1 Singer of a form of confirmation
confirming each Placee's allocation and commitment in the
Placing.
Representations, warranties and further terms
By participating in the Placing, each Placee (and any person
acting on such Placee's behalf) irrevocably represents, warrants,
acknowledges, undertakes and agrees (for itself and for any such
prospective Placee) that in each case as a fundamental term of such
Placee's application for Placing Shares (save where N+1 Singer
expressly agree in writing to the contrary):
1 it has read and understood this Announcement in its entirety
and that its acquisition of the Placing Shares is subject to and
based upon all the terms, conditions, representations, warranties,
indemnities, acknowledgements, agreements and undertakings and
other information contained herein and that it has not relied on,
and will not rely on, any information given or any representations,
warranties or statements made at any time by any person in
connection with Admission, the Fundraising, the Company, the
Placing Shares or otherwise, other than the information contained
in this Announcement and the Publicly Available Information;
2 it has not received a prospectus or other offering document in
connection with the Fundraising and acknowledges that no prospectus
or other offering document: (a) is required under the Prospectus
Directive; and (b) has been or will be prepared in connection with
the Fundraising;
3 the Ordinary Shares are admitted to trading on AIM, and that
the Company is therefore required to publish certain business and
financial information in accordance with the AIM Rules, which
includes a description of the nature of the Company's business and
the Company's most recent balance sheet and profit and loss account
and that it is able to obtain or access such information without
undue difficulty, and is able to obtain access to such information
or comparable information concerning any other publicly traded
company, without undue difficulty;
4 it has made its own assessment of the Placing Shares and has
relied on its own investigation of the business, financial or other
position of the Company in accepting a participation in the Placing
and neither N+1 Singer, 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 information in this Announcement,
or the Publicly Available Information; nor has it requested neither
of N+1 Singer, 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;
5 neither N+1 Singer, any person acting on behalf of them or any
of their respective affiliates, agents, directors, officers or
employees has or shall have any liability for any Publicly
Available Information, or any representation relating to the
Company, provided that nothing in this paragraph excludes the
liability of any person for fraudulent misrepresentation made by
that person;
6 the only information on which it is entitled to rely on and on
which it has relied in committing to subscribe for the Placing
Shares is contained in the Publicly Available Information, such
information being all that it deems necessary to make an investment
decision in respect of the Placing Shares and it has made its own
assessment of the Company, the Placing Shares and the terms of the
Placing based on Publicly Available Information; (b) neither N+1
Singer, the Company nor any of their respective affiliates, agents,
directors, officers or employees has made any representation or
warranty to it, express or implied, with respect to the Company,
the Placing or the Placing Shares or the accuracy, completeness or
adequacy of the Publicly Available Information; (c) it has
conducted its own investigation of the Company, the Placing and the
Placing Shares, satisfied itself that the information is still
current and relied on that investigation for the purposes of its
decision to participate in the Placing; and (d) has not relied on
any investigation that N+1 Singer or any person acting on their
behalf may have conducted with respect to the Company, the Placing
or the Placing Shares;
7 the content of this Announcement and the Publicly Available
Information has been prepared by and is exclusively the
responsibility of the Company and that neither N+1 Singer nor any
persons acting on behalf of it is responsible for or has or shall
have any liability for any information, representation, warranty or
statement relating to the Company contained in this Announcement or
the Publicly Available Information nor will they be liable for any
Placee's decision to participate in the Placing based on any
information, representation, warranty or statement contained in
this Announcement, the Publicly Available Information or otherwise.
Nothing in this Appendix shall exclude any liability of any person
for fraudulent misrepresentation;
8 the Placing Shares have not been registered or otherwise
qualified, and will not be registered or otherwise qualified, for
offer and sale nor will a prospectus be cleared or approved in
respect of any of the Placing Shares under the securities laws of
the United States, or any state or other jurisdiction of the United
States, the Republic of Ireland, Australia, Canada, Republic of
South Africa or Japan and, subject to certain exceptions, may not
be offered, sold, taken up, renounced or delivered or transferred,
directly or indirectly, within the United States, the Republic of
Ireland, Australia, Canada, South Africa or Japan or in any country
or jurisdiction where any such action for that purpose is
required;
9 it and/or each person on whose behalf it is participating:
9.1 is entitled to acquire Placing Shares pursuant to the
Placing under the laws and regulations of all relevant
jurisdictions;
9.2 has fully observed such laws and regulations;
9.3 has capacity and authority and is entitled to enter into and
perform its obligations as an acquirer of Placing Shares and will
honour such obligations; and
9.4 has obtained all necessary consents and authorities
(including, without limitation, in the case of a person acting on
behalf of a Placee, all necessary consents and authorities to agree
to the terms set out or referred to in this Appendix) under those
laws or otherwise and complied with all necessary formalities to
enable it to enter into the transactions contemplated hereby and to
perform its obligations in relation thereto and, in particular, if
it is a pension fund or investment company it is aware of and
acknowledges that it is required to comply with all applicable laws
and regulations with respect to its subscription for Placing
Shares;
10 it is not, and any person who it is acting on behalf of is
not, and at the time the Placing Shares are subscribed will not be,
a resident of, or with an address in, or subject to the laws of,
the United States, the Republic of Ireland, Australia, Canada, the
Republic of South Africa or Japan, and it acknowledges and agrees
that the Placing Shares have not been and will not be registered or
otherwise qualified under the securities legislation of the United
States, the Republic of Ireland, Australia, Canada, the Republic of
South Africa or Japan and may not be offered, sold, or acquired,
directly or indirectly, within those jurisdictions;
11 the Placing Shares have not been, and will not be, registered
under the Securities Act and may not be offered, sold or resold in
or into or from the United States except pursuant to an effective
registration under the Securities Act, or pursuant to an exemption
from, or in a transaction not subject to, the registration
requirements of the Securities Act and in accordance with
applicable state securities laws; and no representation is being
made as to the availability of any exemption under the Securities
Act for the reoffer, resale, pledge or transfer of the Placing
Shares;
12 it and the beneficial owner of the Placing Shares is, and at
the time the Placing Shares are acquired will be, outside the
United States and acquiring the Placing Shares in an "offshore
transaction" as defined in, and in accordance with, Regulation S
under the Securities Act;
13 it (and any account for which it is purchasing) is not
acquiring the Placing Shares with a view to any offer, sale or
distribution thereof within the meaning of the Securities Act;
14 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 Fundraising in or
into or from the United States (including electronic copies
thereof) to any person, and it has not distributed, forwarded,
transferred or otherwise transmitted any such materials to any
person;
15 neither N+1 Singer, its respective affiliates, agents,
directors, officers or employees nor any person acting on behalf of
any of them is making any recommendations to it, advising it
regarding the suitability of any transactions it may enter into in
connection with the Fundraising and that participation in the
Fundraising is on the basis that it is not and will not be a client
of N+1 Singer and N+1 Singer has no duties or responsibilities to
it for providing the protections afforded to its clients or for
providing advice in relation to the Fundraising nor in respect of
any representations, warranties, undertakings or indemnities
contained in the Placing Agreement nor for the exercise or
performance of any of its rights and obligations thereunder
including any rights to waive or vary any conditions or exercise
any termination right;
16 it has the funds available to pay for the Placing Shares for
which it has agreed to subscribe and acknowledges and agrees that
it will make payment to N+1 Singer for the Placing Shares allocated
to it in accordance with the terms and conditions of this
Announcement on the due times and dates set out in this
Announcement, failing which the relevant Placing Shares may be
placed with others on such terms as N+1 Singer may, in its absolute
discretion determine without liability to the Placee and it will
remain liable for any shortfall below the net proceeds of such sale
and the placing proceeds of such Placing Shares and may be required
to bear any stamp duty or stamp duty reserve tax (together with any
interest or penalties due pursuant to the terms set out or referred
to in this Announcement) which may arise upon the sale of such
Placee's Placing Shares on its behalf;
17 no action has been or will be taken by any of the Company,
N+1 Singer or any person acting on their behalf that would, or is
intended to, permit a public offer of the Placing Shares in the
United States or in any country or jurisdiction where any such
action for that purpose is required;
18 the person who it specifies for registration as holder of the
Placing Shares will be: (a) the Placee; or (b) a nominee of the
Placee, as the case may be. Neither N+1 Singer nor the Company will
be responsible for any liability to stamp duty or stamp duty
reserve tax resulting from a failure to observe this requirement.
Each Placee and any person acting on behalf of such Placee agrees
to acquire Placing Shares pursuant to the Fundraising and agrees to
pay the Company and N+1 Singer in respect of the same (including
any interest or penalties) on the basis that the Placing Shares
will be allotted to a CREST stock account of N+1 Singer or
transferred to a CREST stock account of N+1 Singer who will hold
them as nominee on behalf of the Placee until settlement in
accordance with its standing settlement instructions with it;
19 it is acting as principal only in respect of the Placing or,
if it is acting for any other person, (a) it is duly authorised to
do so and has full power to make the acknowledgments,
representations and agreements herein on behalf of each such person
and (b) it is and will remain liable to the Company and N+1 Singer
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);
20 the allocation, allotment, issue and delivery to it, or the
person specified by it for registration as holder, of Placing
Shares will not give rise to a stamp duty or stamp duty reserve tax
liability under (or at a rate determined under) any of sections 67,
70, 93 or 96 of the Finance Act 1986 (depository receipts and
clearance services) and that it is not participating in the Placing
as nominee or agent for any person or persons to whom the
allocation, allotment, issue or delivery of Placing Shares would
give rise to such a liability;
21 it and any person acting on its behalf (if within the United
Kingdom) falls within Article 19(5) and/or 49(2) of the Order and
undertakes that it will acquire, hold, manage and (if applicable)
dispose of any Placing Shares that are allocated to it for the
purposes of its business only;
22 it will not make an offer to the public of the Placing Shares
and it has not offered or sold and will not offer or sell any
Placing Shares to persons in the United Kingdom or elsewhere in the
EEA prior to the expiry of a period of six months from Admission
except to persons whose ordinary activities involve them in
acquiring, holding, managing or disposing of investments (as
principal or agent) for the purposes of their business or otherwise
in circumstances which have not resulted and which will not result
in an offer to the public in the United Kingdom within the meaning
of section 85(1) of the FSMA or an offer to the public in any other
member state of the EEA within the meaning of the Prospectus
Directive;
23 it is a person of a kind described in: (a) Article 19(5)
(Investment Professionals) and/or 49(2) (High net worth companies
etc.) of the FSMA (Financial Promotion) Order 2005, as amended,
and/or an authorised person as defined in section 31 of FSMA; and
(b) section 86(7) of FSMA ("Qualified Investor"), being a person
falling within Article 2.1(e) the Prospectus Directive. For such
purposes, it undertakes that it will acquire, hold, manage and (if
applicable) dispose of any Placing Shares that are allocated to it
for the purposes of its business only;
24 it has only communicated or caused to be communicated and it
will only communicate or cause to be communicated any invitation or
inducement to engage in investment activity (within the meaning of
section 21 of the FSMA) relating to Placing Shares in circumstances
in which section 21(1) of the FSMA does not require approval of the
communication by an authorised person and it acknowledges that this
Announcement is not being issued by N+1 Singer as an authorised
person under Section 21 of FSMA and therefore is not subject to the
same controls applicable to a financial promotion made by an
authorised person;
25 it has complied and it will comply with all applicable laws
with respect to anything done by it or on its behalf in relation to
the Placing Shares (including all relevant provisions of the FSMA
in respect of anything done in, from or otherwise involving the
United Kingdom);
26 if it is a financial intermediary, as that term is used in
Article 3(2) of the Prospectus Directive (including any relevant
implementing measure in any member state), 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 to, persons in a member state
of the EEA which has implemented the Prospectus Directive other
than Qualified Investors, or in circumstances in which the express
prior written consent of N+1 Singer has been given to the offer or
resale;
27 it has neither received nor relied on any confidential price
sensitive information about the Company in accepting this
invitation to participate in the Placing;
28 neither N+1 Singer nor any of its respective affiliates,
agents, directors, officers or employees or any person acting on
behalf of any of them has or shall have any liability for any
information, representation or statement contained in this
Announcement or for any information previously published by or on
behalf of the Company or any other written or oral information made
available to or publicly available or filed information or any
representation, warranty or undertaking relating to the Company,
and will not be liable for its decision to participate in the
Placing based on any information, representation, warranty or
statement contained in this Announcement or elsewhere, provided
that nothing in this paragraph shall exclude any liability of any
person for fraud;
29 neither N+1 Singer, the Company, nor any of their respective
affiliates, agents, directors, officers or employees or any person
acting on behalf of N+1 Singer, the Company or their respective
affiliates, agents, directors, officers or employees is making any
recommendations to it, advising it regarding the suitability of any
transactions it may enter into in connection with the Fundraising
nor providing advice in relation to the Fundraising nor in respect
of any representations, warranties, acknowledgements, agreements,
undertakings, or indemnities contained in the Placing Agreement nor
the exercise or performance of N+1 Singer's rights and obligations
thereunder including any rights to waive or vary any conditions or
exercise any termination right;
30 acknowledges and accepts that N+1 Singer may, in accordance
with applicable legal and regulatory provisions, engage in
transactions in relation to the Placing Shares and/or related
instruments for their own account for the purpose of hedging their
underwriting exposure or otherwise and, except as required by
applicable law or regulation, N+1 Singer will not make any public
disclosure in relation to such transactions;
31 N+1 Singer and each of its affiliates, each acting as an
investor for its or their own account(s), may bid or subscribe for
and/or purchase Placing Shares and, in that capacity, may retain,
purchase, offer to sell or otherwise deal for its or their own
account(s) in the Placing Shares, any other securities of the
Company or other related investments in connection with the Placing
or otherwise. Accordingly, references in this Announcement to the
Placing Shares being offered, subscribed, acquired or otherwise
dealt with should be read as including any offer to, or
subscription, acquisition or dealing by N+1 Singer and/or any of
its respective affiliates, acting as an investor for its or their
own account(s). Neither N+1 Singer nor the Company intend to
disclose the extent of any such investment or transaction otherwise
than in accordance with any legal or regulatory obligation to do
so;
32 it has not offered or sold and will not offer or sell any
Placing Shares to persons in the EEA prior to the expiry of a
period of six months from Admission except to persons whose
ordinary activities involve them in acquiring, holding, managing or
disposing of investments (as principal or agent) for the purpose of
their business 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
Directive;
33 it has complied with its obligations in connection with money
laundering and terrorist financing under the Proceeds of Crime Act
2002, the Terrorism Act 2000, the Terrorism Act 2006 and the Money
Laundering Regulations 2007 (together, the "Regulations") and, if
making payment on behalf of a third party, that satisfactory
evidence has been obtained and recorded by it to verify the
identity of the third party as required by the Regulations;
34 it is aware of the obligations regarding insider dealing in
the Criminal Justice Act 1993, FSMA, the EU Market Abuse Regulation
No. 596 of 2014 and the Proceeds of Crime Act 2002 and confirms
that it has and will continue to comply with those obligations;
35 in order to ensure compliance with the Money Laundering
Regulations 2007, N+1 Singer (for itself and as agent on behalf of
the Company) or the Company's registrars may, in their absolute
discretion, require verification of its identity. Pending the
provision to N+1 Singer or the Company's registrars, as applicable,
of evidence of identity, definitive certificates in respect of the
Placing Shares may be retained at N+1 Singer's absolute discretion
or, where appropriate, delivery of the Placing Shares to it in
uncertificated form may be delayed at N+1 Singer's or the Company's
registrars', as the case may be, absolute discretion. If within a
reasonable time after a request for verification of identity N+1
Singer's (for itself and as agent on behalf of the Company) or the
Company's registrars have not received evidence satisfactory to
them, N+1 Singer and/or the Company may, at its absolute
discretion, terminate its commitment in respect of the Placing, in
which event the monies payable on acceptance of allotment will, if
already paid, be returned without interest to the account of the
drawee's bank from which they were originally debited;
36 acknowledges that its commitment to acquire Placing Shares on
the terms set out in this Announcement and in the form of
confirmation will continue notwithstanding any amendment that may
in future be made to the terms and conditions of the Placing and
that Placees will have no right to be consulted or require that
their consent be obtained with respect to the Company's or N+1
Singer's conduct of the Placing;
37 it has knowledge and experience in financial, business and
international investment matters as is required to evaluate the
merits and risks of subscribing for the Placing Shares. It further
acknowledges that it is experienced in investing in securities of
this nature and is aware that it may be required to bear, and is
able to bear, the economic risk of, and is able to sustain, a
complete loss in connection with the Fundraising. It has relied
upon its own examination and due diligence of the Company and its
affiliates taken as a whole, and the terms of the Fundraising,
including the merits and risks involved;
38 it irrevocably appoints any duly authorised officer of N+1
Singer as its agent for the purpose of executing and delivering to
the Company and/or its registrars any documents on its behalf
necessary to enable it to be registered as the holder of any of the
Placing Shares for which it agrees to subscribe or purchase upon
the terms of this Announcement;
39 the Company, N+1 Singer and others (including each of their
respective affiliates, agents, directors, officers or employees)
will rely upon the truth and accuracy of the foregoing
representations, warranties, acknowledgements and agreements, which
are given to N+1 Singer, on their own behalf and on behalf of the
Company and are irrevocable;
40 if it is acquiring the Placing Shares as a fiduciary or agent
for one or more investor accounts, it has full power and authority
to make, and does make, the foregoing representations, warranties,
acknowledgements, agreements and undertakings on behalf of each
such accounts;
41 time is of the essence as regards its obligations under this Appendix;
42 any document that is to be sent to it in connection with the
Fundraising will be sent at its risk and may be sent to it at any
address provided by it to N+1 Singer;
43 the Placing Shares will be issued subject to the terms and
conditions of this Appendix; and
44 these terms and conditions in this Appendix and all documents
into which this Appendix is incorporated by reference or otherwise
validly forms a part and/or any agreements entered into pursuant to
these terms and conditions and all agreements to acquire shares
pursuant to the Placing will be governed by and construed in
accordance with English law and it submits to the exclusive
jurisdiction of the English courts in relation to any claim,
dispute or matter arising out of any 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 the Company or N+1 Singer in
any jurisdiction in which the relevant Placee is incorporated or in
which any of its securities have a quotation on a recognised stock
exchange.
By participating in the Placing, each Placee (and any person
acting on such Placee's behalf) agrees to indemnify and hold the
Company, N+1 Singer and each of their respective affiliates,
agents, directors, officers and employees harmless from any and all
costs, claims, liabilities and expenses (including legal fees and
expenses) arising out of or in connection with any breach of the
representations, warranties, acknowledgements, agreements and
undertakings given by the Placee (and any person acting on such
Placee's behalf) in this Appendix or incurred by N+1 Singer, the
Company or each of their respective affiliates, agents, directors,
officers or employees arising from the performance of the Placee's
obligations as set out in this Announcement, and further agrees
that the provisions of this Appendix shall survive after the
completion of the Placing.
The agreement to allot and issue Placing Shares to Placees (or
the persons for whom Placees are contracting as agent) free of
stamp duty and stamp duty reserve tax in the United Kingdom relates
only to their allotment and issue to Placees, or such persons as
they nominate as their agents, direct by the Company. Such
agreement assumes that the Placing Shares are not being acquired in
connection with arrangements to issue depositary receipts or to
transfer the Placing Shares into a clearance service. If there are
any such arrangements, or the settlement related to any other
dealings in the Placing Shares, stamp duty or stamp duty reserve
tax may be payable. In that event, the Placee agrees that it shall
be responsible for such stamp duty or stamp duty reserve tax and
neither the Company nor N+1 Singer shall be responsible for such
stamp duty or stamp duty reserve tax. If this is the case, each
Placee should seek its own advice and they should notify N+1 Singer
accordingly. In addition, Placees should note that they will be
liable for any capital duty, stamp duty and all other stamp, issue,
securities, transfer, registration, documentary or other duties or
taxes (including any interest, fines or penalties relating thereto)
payable outside the United Kingdom by them or any other person on
the acquisition by them of any Placing Shares or the agreement by
them to acquire any Placing Shares and each Placee, or the Placee's
nominee, in respect of whom (or in respect of the person for whom
it is participating in the Placing as an agent or nominee) the
allocation, allotment, issue or delivery of Placing Shares has
given rise to such non-United Kingdom stamp, registration,
documentary, transfer or similar taxes or duties undertakes to pay
such taxes and duties, including any interest and penalties (if
applicable), forthwith and to indemnify on an after-tax basis and
to hold harmless the Company and N+1 Singer in the event that
either the Company and/or N+1 Singer has incurred any such
liability to such taxes or duties.
The representations, warranties, acknowledgements and
undertakings contained in this Appendix are given to N+1 Singer for
itself and on behalf of the Company and are irrevocable.
Each Placee and any person acting on behalf of the Placee
acknowledges that N+1 Singer does not owe any fiduciary or other
duties to any Placee in respect of any representations, warranties,
undertakings, acknowledgements, agreements or indemnities in the
Placing Agreement.
Each Placee and any person acting on behalf of the Placee
acknowledges and agrees that N+1 Singer may (at its absolute
discretion) satisfy their obligations to procure Placees by itself
agreeing to become a Placee in respect of some or all of the
Placing Shares or by nominating any connected or associated person
to do so.
When a Placee or any person acting on behalf of the Placee is
dealing with N+1 Singer, any money held in an account with N+1
Singer on behalf of the Placee and/or any person acting on behalf
of the Placee will not be treated as client money within the
meaning of the relevant rules and regulations of the FCA made under
FSMA. Each Placee acknowledges that the money will not be subject
to the protections conferred by the client money rules: as a
consequence this money will not be segregated from N+1 Singer's
money (as applicable) in accordance with the client money rules and
will be held by it under a banking relationship and not as
trustee.
References to time in this Announcement are to London time,
unless otherwise stated.
All times and dates in this Announcement may be subject to
amendment.
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.
The price of shares and any income expected from them may go
down as well as up and investors may not get back the full amount
invested upon disposal of the shares. Past performance is no guide
to future performance, and persons needing advice should consult an
independent financial adviser.
The Placing Shares to be issued or sold pursuant to the Placing
will not be admitted to trading on any stock exchange other than
the London Stock Exchange.
Neither the content of the Company's website nor any website
accessible by hyperlinks on the Company's website is incorporated
in, or forms part of, this Announcement.
DEFINITIONS
The following definitions apply throughout this announcement
unless the context requires otherwise:
"Admission" the admission of the New Ordinary Shares
to trading on AIM becoming effective
in accordance with Rule 6 of the AIM
Rules
"AIM" the AIM market operated by the London
Stock Exchange
"AIM Rules" the AIM Rules for Companies and guidance
notes published by the London Stock
Exchange from time to time
"Application the personalised application form which
Form" will accompany the Circular on which
Qualifying Non-CREST Shareholders may
apply for Open Offer Shares under the
Open Offer
"Basic Entitlement(s)" the pro rata entitlement of Qualifying
Shareholders to subscribe for Open Offer
Shares on and subject to the terms of
the Open Offer
"Bookbuild" the process to be carried out by N+1
Singer in seeking to secure Placees
for the Placing Shares
"certificated an ordinary share recorded on a company's
form" or "in share register as being held in certificated
certificated form (namely, not in CREST)
form"
"Circular" the circular to be issued by the Company
to Shareholders including, inter alia,
details of the Placing and details and
terms of the Open Offer, and attaching
the Form of Proxy and, to Qualify Non-CREST
Shareholders (other than certain overseas
Qualifying Non-CREST Shareholders),
the Application Form
"Closing Price" the closing middle market quotation
of an Ordinary Share as derived from
the Daily Official List of the London
Stock Exchange
"Company" or Applied Graphene Materials plc, a public
"Applied Graphene limited company incorporated and registered
Materials" in England and Wales with registered
number 08708426
"CREST" the relevant system (as defined in the
CREST Regulations) in respect of which
Euroclear is the operator (as defined
in those regulations)
"Directors" the directors of the Company
or "Board"
"Expenses" the expenses incurred in connection
with the Fundraising
"Euroclear" Euroclear UK & Ireland Limited, the
operator of CREST
"Excess Application the arrangement pursuant to which Qualifying
Facility" Shareholders may apply for additional
Open Offer Shares in excess of their
Basic Entitlements in accordance with
the terms and conditions of the Open
Offer
"Excess Entitlement(s)" in respect of each Qualifying CREST
Shareholder who has taken up his Basic
Entitlement in full, the entitlement
(in addition to the Basic Entitlement)
to apply for Excess Shares up to the
number of Open Offer Shares credited
to his stock account in CREST pursuant
to the Excess Application Facility,
which, subject to the terms of the Placing
Agreement, may be subject to scaling
down according to the Directors' and
N+1 Singer's absolute discretion
"Existing Ordinary the 22,290,763 Ordinary Shares in issue
Shares" at the date of this announcement, all
of which are admitted to trading on
AIM and being the entire issued ordinary
share capital of the Company
"FCA" the Financial Conduct Authority in its
capacity as the competent authority
for the purposes of Part VI of FSMA
"Form of Proxy" the form of proxy for use by Shareholders
in connection with the General Meeting
"Fundraising" the Placing and Open Offer, further
or "Issue" details of which are set out in this
announcement
"FSMA" the Financial Services and Markets Act
2000 (as amended)
"General Meeting" the general meeting of the Company to
be held at the offices of Squire Patton
Boggs at 6 Wellington Place, Leeds LS1
4AP at 11.00 a.m. on 30 October 2017,
or any reconvened meeting following
any adjournment of the general meeting,
notice of which will be set out at the
end of the Circular
"Group" the Company, its subsidiaries and its
subsidiary undertakings
"Issue Documents" means the Circular, the Form of Proxy,
this announcement, the Application Form,
the presentation prepared in connection
with marketing of the Fundraising and
any other announcement or document published
by the Company or on its behalf in relation
to the Fundraising
"Issue Price a minimum of 36 pence per New Ordinary
Share or such greater price as notified
by the Company and / or N+1 Singer
"London Stock London Stock Exchange plc
Exchange"
"Net Proceeds" the proceeds from the issue of the New
Ordinary Shares, after the deduction
of the Expenses
"New Ordinary the new Ordinary Shares to be issued
Shares" pursuant to the Fundraising
"Nominated Adviser" Nplus1 Singer Advisory LLP, the Company's
or "N+1 Singer" nominated adviser and broker
"Open Offer" the conditional invitation to Qualifying
Shareholders to apply to subscribe for
Open Offer Shares at the Issue Price
on the terms and subject to the conditions
to be set out in the Circular and, in
the case of Qualifying Non-CREST Shareholders
only, the Application Form
"Open Offer an entitlement to apply to subscribe
Entitlements" for Open Offer Shares, allocated to
Qualifying Shareholders pursuant to
the Open Offer
"Open Offer such number of new Ordinary Shares as
Shares" will be set out in the Circular, to
be offered to Qualifying Shareholders
"Ordinary Shares" the ordinary shares of 2 pence each
in the capital of the Company
"Overseas Shareholders" Shareholders with registered addresses
outside the United Kingdom or who are
citizens or residents of countries outside
the United Kingdom
"Placing" the conditional placing of the New Ordinary
Shares by N+1 Singer, as agent on behalf
of the Company, pursuant to the Placing
Agreement
"Placing Agreement" the conditional agreement dated 10 October
2017 made between N+1 Singer and the
Company in relation to the Fundraising
"Placing Shares" a minimum of GBP9 million of New Ordinary
Shares to be issued pursuant to the
Placing
"Qualifying Qualifying Shareholders holding Ordinary
CREST Shareholders" Shares in uncertificated form in CREST
at the Record Date
"Qualifying Qualifying Shareholders holding Ordinary
Non-CREST Shareholders" Shares in certificated form at the Record
Date
"Qualifying holders of Existing Ordinary Shares
Shareholders" on the register of members of the Company
at the Record Date with the exclusion
of Overseas Shareholders with a registered
address or who are resident in any Restricted
Jurisdiction
"Record Date" 5.30 p.m. on 10 October 2017
"Resolutions" the resolutions to be proposed at the
General Meeting
"Restricted each and any of the United States, Australia,
Jurisdiction" Canada, the Republic of South Africa,
Japan and any other jurisdiction where
the extension or the availability of
the Open Offer would breach any applicable
law
"Securities the US Securities Act of 1933 (as amended)
Act"
"Shareholders" holders of Ordinary Shares
"UK" the United Kingdom of Great Britain
and Northern Ireland
"US" or "United the United States of America, each State
States" thereof, its territories and possessions
(including the District of Columbia)
and all other areas subject to its jurisdiction
"uncertificated" a shareholding which is recorded on
or "in uncertificated a company's share register as being
form" held in uncertificated form in CREST
and title to which, by virtue of the
CREST Regulations, may be transferred
by means of CREST
This information is provided by RNS
The company news service from the London Stock Exchange
END
IOEGMMGGZLRGNZZ
(END) Dow Jones Newswires
October 10, 2017 02:05 ET (06:05 GMT)
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