TIDMAREC
RNS Number : 3952U
Arecor Therapeutics PLC
01 August 2022
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THIS ANNOUNCEMENT, INCLUDING THE APPICES TO THIS ANNOUNCEMENT,
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OFFER FOR SALE OR SUBSCRIPTION OF ANY SECURITIES IN THE COMPANY.
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THIS ANNOUNCEMENT SHOULD BE READ IN ITS ENTIRETY. IN PARTICULAR,
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APPICES INCLUDING APPIX II WHICH CONTAINS THE TERMS AND CONDITIONS
OF THE PLACING. THE DEFINITIONS USED IN THIS ANNOUNCEMENT ARE SET
OUT IN APPIX III OF THIS ANNOUNCEMENT.
1 August 2022
Arecor Therapeutics plc
("Arecor", the "Company" or the "Group")
Proposed Acquisition of Tetris Pharma Ltd to add key commercial
diabetes product and build out Arecor's specialty hospital products
franchise with scalable sales, marketing and distribution
platform
Proposed Placing to Raise Approximately GBP6 million
Arecor Therapeutics plc (AIM: AREC), a globally focused
biopharmaceutical company advancing today's therapies to enable
healthier lives, announces that it has entered into a conditional
agreement to acquire the entire issued share capital of Tetris
Pharma Ltd ("Tetris Pharma"). Tetris Pharma is a commercial stage
speciality pharmaceutical company with a sales and distribution
team and a platform focused on injectable speciality products
across the UK and Europe. The Directors believe that the
acquisition adds a key commercial diabetes product to Arecor's
portfolio, as well as complementing Arecor's existing specialty
hospital products franchise, offering the potential to accelerate
significant revenue growth for Arecor.
Sarah Howell, CEO of Arecor Therapeutics commented:
"The Board of Arecor believe that the acquisition of Tetris
Pharma is a compelling opportunity to accelerate Arecor's
commercially-driven strategy alongside our core diabetes and
partnered products businesses. We will gain an existing,
revenue-generating, sales, marketing and distribution platform
which we believe is highly complementary to our existing specialty
hospitals products business and has significant growth potential.
The lead product, Ogluo(R), meets a key patient need for people
living with diabetes at risk of severe hypoglycaemia, which is a
therapeutic area that we understand well, giving us confidence in
its prospects and our ability to deliver. In addition, the platform
would add future optionality to our specialty products franchise by
providing the capability to take selected products to market in the
UK and Europe where appropriate in addition to our already proven
partnering strategy."
Acquisition benefits
The Directors believe that the Acquisition offers the potential
to significantly accelerate Arecor's revenue growth. Tetris Pharma
has an exclusive supply agreement and licence to sell the first
stable liquid ready-to-use glucagon auto-injector pen, Ogluo(R),
within the EEA, UK and Switzerland. Ogluo(R) is a proprietary
ready-to-use glucagon indicated to treat severe hypoglycaemia, a
potentially life-threatening condition, in people with diabetes.
Tetris Pharma is targeting a significant market share within an
existing c.GBP100 million+ market across the licensed territory.
Ogluo(R) was launched by Tetris Pharma in the UK earlier this year
and launches across key European territories are planned over the
next 12 to 24 months.
The Directors believe the Acquisition will help realise Arecor's
vision of becoming a significant self-sustaining biopharmaceutical
business by providing:
1) Addition of a key proprietary diabetes specialty product aligned to Arecor's vision
-- Transforming patient care by enhancing existing therapeutic
medicines so that they are safer, more effective and
easier-to-use
-- Ogluo(R) is an important and proprietary product, patent
protected until at least 2035, with real medical need
-- Ogluo(R) is the first ready-to-use liquid stable glucagon for
the treatment of severe hypoglycaemia, a potentially
life-threatening condition that requires safe, fast and effective
treatment
2) Strategic fit and the provision of partnership optionality
across Arecor's proprietary specialty hospital franchise
-- The Tetris Pharma sales and distribution platform provides
Arecor with optionality on partnering structures to realise full
value of Arecor's proprietary specialty hospital products
-- Future potential to take selected niche specialty hospital
products to market in the UK and Europe
4) Complementary team skills and expertise
-- Opportunity to enhance specialty therapeutic knowledge across
product development and commercialisation life-cycle
-- Enhance interactions with diabetes key opinion leaders,
patient groups and payers for the benefit of both Ogluo(R) and
Arecor's lead proprietary diabetes development products, AT247 and
AT278
5) Anticipated positive cashflow contribution from Tetris Pharma
with Tetris Pharma expected to break even within c. 3 years from
completion of the Acquisition
-- Tetris Pharma generated initial revenues of c. GBP600,000
(unaudited) in the six months to 30 June 2022. The Directors
believe that there is potential for significant revenue growth as
Ogluo(R) roll-out progresses
-- Expected future cash contribution to Arecor Therapeutics
which can be utilised to increase/accelerate value enhancing
proprietary product development
There is no change of strategy in relation to Arecor's lead
diabetes products AT247 and AT278, where Arecor intends to generate
additional clinical data to further demonstrate the superiority of
these products compared with gold standard insulins available to
patients today, and to position these products for partnering under
Arecor's existing licensing model.
Transaction terms
Pursuant to the terms of the Acquisition, the Company has agreed
to acquire the entire issued share capital of Tetris Pharma for
initial consideration consisting of the issue of 651,726 new
Ordinary Shares to the Tetris Pharma Sellers. The Company has also
agreed to discharge certain existing liabilities of Tetris Pharma
with an aggregate value of approximately GBP2.0 million, such
liabilities including, inter alia, the Inventory Payment and
certain other one-off liabilities (together the " Tetris Pharma
Payments "). Deferred consideration of up to GBP4.0 million in
aggregate is payable to the Tetris Pharma Sellers through three
Earn Out Payments on the first, second and third anniversaries of
completion of the Acquisition subject to revenue and EBITDA
performance targets to be satisfied through the issue of either (i)
new Ordinary Shares or (ii) unsecured loan notes having an
aggregate principal value equal to the amount of the relevant Earn
Out Payment, at Arecor's election. The Initial Consideration Shares
represent 2.3 per cent. of the existing issued share capital of the
Company and are subject to lock-in arrangements. Further details on
the rationale for, and the terms of, the Acquisition are set out in
the Additional Information section of this Announcement.
To finance the Tetris Pharma Payments and to provide growth
capital to accelerate the roll-out of Ogluo(R) across the UK and
Europe and to provide a line of sight to break even for Tetris
Pharma, the Company announces a proposed Placing of approximately
GBP6 million, before expenses, of new Ordinary Shares at a Placing
Price of 300 pence per new Ordinary Share.
The Acquisition is conditional, inter alia, on completion of the
Placing. The Placing Shares will be issued pursuant to the share
authorities approved at the Company's annual general meeting held
on 23 May 2022.
The Placing Price represents a discount of approximately 3.2 per
cent. to the closing mid-market price of 310 pence per Existing
Ordinary Share on 29 July 2022, being the latest practicable date
prior to the publication of this Announcement.
The Placing will be conducted by way of an accelerated book
building process (the "Bookbuild"), which will be launched
immediately following this Announcement in accordance with the
terms and conditions set out in Appendix II. The Placing Shares are
not being made available to the public. It is envisaged that the
Bookbuild will be closed no later than 4.30 p.m. BST today, 1
August 2022. Details of the number of Placing Shares and the gross
proceeds of the Placing will be announced as soon as practicable
after the closing of the Bookbuild. The Placing is not
underwritten.
Tetris Pharma highlights
-- Tetris Pharma is a revenue-generating, commercial stage
pharmaceutical company established in April 2020 to develop a
platform focused on niche speciality pharma injectable products
across the UK and Europe targeting currently underserved patient
needs. The business model is to license rights to sell and
distribute specialty products from pharmaceutical companies by
providing a platform to access the UK and European markets.
-- Tetris Pharma's lead product - Ogluo(R) - is approved in the
UK and EEA for the treatment of severe hypoglycaemia in patients
with Type 1 and Type 2 diabetes, a serious emergency condition
which left untreated may cause seizure, coma and even death.
-- Ogluo(R) is an important and proprietary product with real
medical need providing the first stable liquid ready-to-use
glucagon in an easy-to-use auto-injector pen as an emergency
treatment for severe hypoglycaemia. With Arecor's deep
understanding of the diabetes market, the Directors believe the
simple two step administration of Ogluo(R) offers a strong patient
benefit and competitive advantage over the standard of care and, as
such, has the potential to capture significant share within a
c.GBP100 million+ market across Europe and the UK.
-- Tetris Pharma has, conditional on, inter alia, completion of
the Acquisition, entered into an amended exclusive 16-year minimum
term licence and supply agreement with Xeris Pharmaceuticals, Inc.
(" Xeris ") for the sale and distribution of Ogluo(R) in the EEA,
UK and Switzerland. Ogluo(R) is sold by Xeris under the registered
name Gvoke(R) in the US.
-- Since launch in Q4 2019, Gvoke(R) has demonstrated a
quarter-on--quarter growth in the number of prescriptions in the
US, with c. 88 per cent. growth from Q1 2021 to Q1 2022,
demonstrating patient and prescriber demand for this product which
is also expected to translate to the UK and European markets.
-- Ogluo(R) was made available in the UK in December 2021.
-- Total sales by Tetris Pharma (unaudited) in the six months to
30 June 2022 were c.GBP600,000.
The Acquisition is conditional upon Admission of the Initial
Consideration Shares and the Placing Shares.
Fundraising highlights
-- Placing to raise approximately GBP6 million, before expenses,
through the issue of new Ordinary Shares at the Placing Price.
-- It is expected that certain Directors of the Company will
subscribe for new Ordinary Shares as part of the Placing on the
same terms as other Placees for an aggregate amount of at least
GBP100,000.
-- c.GBP2.6 million of the Placing is EIS and VCT eligible.
-- The Placing Price represents a discount of approximately 3.2
per cent. to the closing mid-market price of 310 pence per Existing
Ordinary Share on 29 July 2022, being the latest practicable date
prior to the publication of this Announcement.
-- The net proceeds of the Placing will be used to fund, inter
alia, the Tetris Pharma Payments and provide working capital to
Tetris Pharma following completion.
The Placing is conditional on, inter alia, EIS/VCT Admission,
General Admission and the Placing Agreement having become
unconditional in all respects save for Admission and the Xeris
Licence Amendment and the SPA having been duly executed by all
parties thereto. The EIS/VCT Placing Shares will be issued
unconditionally on the EIS/VCT Admission prior to completion of the
Acquisition and prior to General Admission. The placing of the
General Placing Shares is conditional upon completion of the
Acquisition. The General Placing Shares will be issued
unconditionally on the General Admission along with the issue of
the Initial Consideration Shares such that the Acquisition and the
Placing complete simultaneously.
The EIS/VCT Placing is not conditional on completion of the
Acquisition, the issue of the General Placing Shares or General
Admission. Investors should note that it is possible that EIS/VCT
Admission will occur, but the Acquisition and General Admission
will not occur.
The expected timetable of principal events is set out in
Appendix I to this Announcement. The Placing is subject to the
terms and conditions set out in Appendix II to this Announcement.
Capitalised terms have the meaning set out in Appendix III to this
Announcement.
For more information, please contact:
Arecor Therapeutics plc www.arecor.com
Dr Sarah Howell, Chief Executive Officer Tel: +44 (0) 1223 426060
Email: info@arecor.com
Susan Lowther, Chief Financial Officer Tel: +44 (0) 1223 426060
Email: info@arecor.com
Mo Noonan, Communications Tel: +44 (0) 7876 444977
Email: mo.noonan@arecor.com
Panmure Gordon (UK) Limited (NOMAD
and Broker)
Freddy Crossley, Emma Earl (Corporate Tel: +44 (0) 20 7886 2500
Finance)
Rupert Dearden (Corporate Broking)
Consilium Strategic Communications
Chris Gardner, David Daley, Angela Tel: +44 (0) 20 3709 5700
Gray Email: arecor@consilium-comms.com
Notes to Editors
About Arecor
Arecor Therapeutics plc is a globally focused biopharmaceutical
group transforming patient care by bringing innovative medicines to
market through the enhancement of existing therapeutic products. By
applying our innovative proprietary formulation technology
platform, Arestat(TM), we are developing an internal portfolio of
proprietary products in diabetes and other indications, as well as
working with leading pharmaceutical and biotechnology companies to
deliver enhanced formulations of their therapeutic products. The
Arestat(TM) platform is supported by an extensive patent
portfolio.
For further details please see our website, www.arecor.com
IMPORTANT NOTICES
No action has been taken by the Company, Panmure Gordon or any
of their respective affiliates, that would, or which is intended
to, permit a public offer of the Placing Shares in any jurisdiction
or the possession or distribution of this Announcement or any other
offering or publicity material relating to the Placing Shares in
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into whose possession this Announcement comes shall inform
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No prospectus will be made available in connection with the
matters contained in this Announcement and no such prospectus is
required (in accordance with the Prospectus Directive) to be
published.
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IS FOR INFORMATION PURPOSES ONLY, IS NOT INTED TO AND DOES NOT
CONSTITUTE OR FORM PART OF ANY OFFER OR INVITATION TO PURCHASE OR
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OFFER TO PURCHASE OR SUBSCRIBE, SELL, ACQUIRE, DISPOSE OF THE
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WHOM, SUCH OFFERING, SOLICITATION OR SALE WOULD BE UNLAWFUL.
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Kingdom by the FCA, is acting as nominated adviser and joint broker
to the Company in relation to the Placing, EIS/VCT Admission and
General Admission and is not acting for any other persons in
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identify or suggest, the risks (direct or indirect) that may be
associated with an investment in the Placing Shares. Any investment
decision to buy Placing Shares in the Placing must be made solely
on the basis of publicly available information, which has not been
independently verified by Panmure Gordon.
The price of Ordinary Shares and any income from them may go
down as well as up and investors may not get back the full amount
invested on disposal of the Ordinary Shares.
The Placing Shares will not be admitted to trading on any stock
exchange other than AIM, a market operated by the London Stock
Exchange.
This Announcement may contain "forward-looking statements" which
includes all statements other than statements of historical fact,
including, without limitation, those regarding the Company's
financial position, business strategy, plans and objectives of
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"could" or similar expressions or negatives thereof. Such
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uncertainties and other important factors beyond the Company's
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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. These forward-looking statements speak
only as at the date of this Announcement. None of the Company,
Panmure Gordon or their respective directors, officers, employees,
agents, affiliates and advisers, or any other party undertakes or
is under any duty to update this Announcement or to correct any
inaccuracies in any such information which may become apparent or
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fullest extent permissible by law, such persons disclaim all and
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or otherwise, which they might otherwise have in respect of this
Announcement. The information in this Announcement is subject to
change without notice.
Additional Information
Introduction
Arecor Therapeutics plc is a globally focused biopharmaceutical
company transforming patient care by enhancing existing therapeutic
medicines so that they are safer, more effective and easier to use.
By applying the Group's innovative proprietary formulation
technology platform, Arestat(TM), the Group is developing a
portfolio of proprietary products, as well as working with
pharmaceutical and biotechnology companies to deliver enhanced
reformulations of their partners' therapeutic products, supported
by an extensive patent portfolio.
Arecor's proprietary product portfolio covers two areas of
products focused on diabetes and specialty hospital care. This is
alongside the development of novel enhanced formulations of partner
products that include biosimilars, biological products and vaccines
which are derived from the Group's formulation development and
technology licensing programmes.
Arecor's shares were admitted to trading on AIM in June 2021
and, since then, Arecor has generated best-in-class clinical data
for AT278, initiated an insulin pump clinical study to further
demonstrate superiority of AT247 and expanded its
revenue-generating technology partnerships.
Upon completion of the Acquisition, Arecor will operate in three
complementary areas underpinned by its expertise in enhancing
existing therapeutic medicines so they are safer, more effective
and easy-to-use:
-- Arecor's proprietary diabetes franchise including AT278, an
ultra-rapid acting, ultra-concentrated (500U/mL) insulin product
candidate, and AT247, an ultra-rapid acting insulin (100U/mL)
product candidate. Excellent clinical progress has continued
to-date, and the Group is on track to report headline data from its
ongoing US 3-day insulin pump clinical study of AT247 later this
year and also within the year to start dosing patients in a further
clinical trial of AT278 in people with living with type 2
diabetes.
-- Technology partnerships and licensing, which include its
recently announced exclusive formulation study collaboration with a
top five global pharma company, following five collaboration
agreements entered into during 2021, all of which are
revenue-generating and the potential for significant upside
potential from licensing. The pipeline for further
revenue-generating partnered collaborations is strong with further
deals anticipated. In addition, Arecor has entered into two
licensing agreements where the Arestat(TM) technology has been
incorporated into our partners products, AT220 (undisclosed
biosimilar) and AT292 (INHBRX-101, Inhibrx), with both products
continuing progress through development, offering upside revenue
potential from development milestones and commercial payment terms
under the licences.
-- Arecor's specialty hospital products franchise which will
include the Tetris Pharma portfolio and Arecor's in-house
development pipeline of specialty hospital products. Where the
focus is to develop ready-to-use and ready-to-administer versions
of existing therapeutic products that have the potential to enable
fast, safer and effective treatment options for patients. Arecor
has licensed two of its specialty hospital products to Hikma
Pharmaceuticals under co-development and licensing agreements.
The Directors believe that the pipeline for future
revenue-generating partnered collaborations is strong with further
deals anticipated in H2 and beyond.
Information on Tetris Pharma
Tetris Pharma is a UK and Netherlands based specialty
pharmaceutical company with a marketing and distribution platform
across the UK and European markets with a core focus on niche
injectable and hospital-based prescription products in areas of
unmet medical need. Tetris Pharma has an initial portfolio
comprising nine license and distribution agreements, in addition to
Ogluo(R), which have been put in place to establish the platform
and make a positive contribution to cashflow. Its lead product,
Ogluo(R), is a novel stable liquid formulation of glucagon
delivered through an easy-to-use auto-injector pen for the
management of severe hypoglycaemia in patients with diabetes.
Whilst the existing market opportunity is estimated to be GBP100
million across the UK and Europe based on actual 2021 unit sales of
glucagon across the territory (1.65m units) multiplied by the
premium pricing achieved for ready-to-use glucagon, the total
potential addressable market opportunity for Ogluo(R) is estimated
to be worth in the region of $1 billion across the UK and Europe if
all patients with diabetes who take insulin were prescribed premium
priced ready-to-use glucagon (2 units of glucagon per
prescription).
Tetris Pharma's strategy is to license rights to branded
medicines and niche injectables products to market with a focus on
superior versions of products which have been available for some
time but have been repurposed with a new indication, presentation,
or formulation. Tetris Pharma requires minimal expenditure on
research and development and the Directors believe has a de-risked
commercialisation strategy. Tetris Pharma has an experienced team
and leadership with a track record of sales, marketing and
distribution of specialty products across the UK and Europe and
also leverages Contract sales organisations, which can be flexed up
and down and hence represents a capital efficient model.
Lead product - Ogluo(R)
Ogluo (R) is the only ready-to-use liquid glucagon available in
the UK for the treatment of severe hypoglycaemia and is indicated
for the treatment of severe hypoglycaemia in adults, adolescents,
and children aged 2 years and over with diabetes mellitus. Ogluo(R)
is administered via a simple two-step process offering a safe, fast
and effective treatment of severe hypoglycaemia in this emergency
situation. The pre-mixed, pre-filled auto-injector pen provides an
easy, two step administration of a 1.0 mg (adult and paediatric) or
0.5 mg (paediatric) dose of glucagon. The current standard of care
in the UK is a lyophilised glucagon emergency kit which in
comparison requires a complex eight-step administration. Ogluo(R)
also has a shelf life of at least two years and no requirement for
cold storage. Tetris Pharma has achieved a reimbursement premium
price for the auto-injector pen in the UK of GBP73 per
single-dose
Severe hypoglycaemia is a serious condition with people with
Type 1 diabetes, who have on average 1.15 severe hypoglycaemic
events per year and people with Type 2 diabetes on insulin, who
have on average 0.35 events per year. In people with Type 1
diabetes, 4-10% of deaths are attributed to hypoglycaemia. Any
person with diabetes who is using insulin would be clinically
appropriate for a prescription of glucagon. In the Ogluo(R) Tetris
Pharma licensed territory of the EEA, UK and Switzerland there are
approximately 5 million Type 1 and Type 2 insulin treated
diabetics. This leads to a total potential market opportunity in
the licensed territory of approximately $1 billion if all of this 5
million clinically relevant patient population were prescribed two
units of ready-to-use glucagon at an average price of $100/unit
(EUR85/unit at 1:1.20 forex). However, not all clinically relevant
patients take a prescription for glucagon, and hence, the current
market opportunity in the licensed territory is c.GBP100 million as
outlined above, with market growth opportunity with increased
number of prescriptions.
The Directors believe that Ogluo(R) is well placed to take
significant market share on the basis of its benefits for fast,
safe and effective administration of glucagon via a simple to use
auto-injector pen and the commercial launch of the equivalent
product, Gvoke(R) in the US by Xeris alongside being the first
ready-to-use liquid glucagon product approved for use in the EEA
and the UK.
Ogluo(R) has been exclusively licensed by Tetris Pharma from
Nasdaq-listed Xeris within the licensed territory of the EEA, UK
and Switzerland . Ogluo(R) is marketed by Xeris under the brand
Gvoke (R) in the US. Ogluo(R) was made available by Tetris Pharma
in the UK in December 2021 and active sales began in the UK in
March 2022, albeit with a limited sales and marketing budget. The
Directors believe there will be strong demand for Ogluo(R) and a
significant opportunity to grow revenues as the roll-out across the
UK and Europe progresses.
Xeris was granted FDA approval for Gvoke (R) in the US in
September 2019. Gvoke(R) has grown its market share of the US
glucagon rescue market from 6.4 per cent. in June 2020 to 22.8 per
cent. in May 2022 having seen steady growth despite the impact of
COVID-19.
During the year ended 31 December 2021, Tetris Pharma generated
unaudited revenue of GBP0.3 million and a loss after tax of GBP0.8
million. Its unaudited financials for the 6 months to 30 June 2022
showed sales of GBP0.6 million with a loss after tax of GBP1.7
million (including one-off non-recurring costs of c.GBP0.5
million). Tetris Pharma comprises a team of ten people with eight
in the UK and two in the Netherlands, who are expected to remain an
important part of Tetris Pharma following the Acquisition. To the
end of June 2022, Tetris Pharma has sold 1,729 units of Ogluo(R) in
the UK.
In the UK, acceleration is expected to be achieved through a
combination of increased contract sales organisation activity to
drive the switch to Ogluo(R) as well as gaining formulary approval
for Ogluo(R), with a focus on the large patient centres within the
UK. There will be a phased launch across Europe, prioritizing key
high value/high price countries initial, such as Germany, the
Netherland and key Nordic territories. Contract sales organization
activity will also be increased on a country-by-country basis to
drive sales.
Following completion of the Acquisition, the Group will
accelerate the rollout of Ogluo(R) across the UK and into Europe
with target launches across key European territories over the next
12 to 24 months targeting centres around diabetologists,
endocrinologists with interest in diabetes, diabetes nurse
specialists and formulary/specialist pharmacists.
Background and reasons for, the Acquisition and the Placing
Arecor's strategy is to build a leading portfolio of proprietary
therapeutic medicines by applying the Company's innovative
formulation technology platform Arestat(TM) alongside technology
partnership focused on two primary target areas: diabetes and
specialty hospital care. The Board considers Tetris Pharma to be a
clear strategic fit with Arecor and believes the Acquisition will
provide a number of commercial, operational and financial benefits,
which are expected to create future value for Shareholders. In
particular, the Directors believe that the Acquisition offers the
potential to accelerate significant revenue growth for Arecor.
The Acquisition builds on Arecor's existing specialty hospital
products franchise, bringing a scalable sales, marketing and
distribution platform for ready-to-use specialty products in
Europe. Tetris Pharma's experienced leadership team has a track
record in product launches and commercialisation across the UK and
EU. In addition to the potential revenue growth from Ogluo(R),
Tetris Pharma's commercial platform brings Arecor access to a
commercial infrastructure for niche products. This will allow
Arecor greater future optionality of deal structure to fully
realise the value of its own proprietary products and the potential
to take selected proprietary and partnered products to the market
in the UK and Europe. The Directors also believe that the
Acquisition will:
-- Build out Arecor's specialty product franchise and add a key
proprietary diabetes specialty product with Ogluo(R).
-- Create future potential to take select niche specialty
hospital products to market in the UK and Europe.
-- Provide an anticipated positive cashflow contribution to
Arecor which can be utilised to accelerate value enhancing
proprietary product development.
-- Provide complementary skills and expertise from the Tetris
Pharma team, broadening the Group's specialty therapeutic
knowledge.
-- Enhance interactions with diabetes key opinion leaders, patient groups and payers.
The proceeds of the Placing are expected to facilitate the
future growth of Tetris Pharma. The Board believes that having the
right to sell Ogluo(R) has the potential to add a significant
revenue stream to the business and expects significant year-on-year
growth and gross margins for Tetris Pharma to be in the region of
between 24 per cent. and 37 per cent. per year. The Directors
estimate that based on current cost run-rates, Tetris Pharma has
the potential to reach break-even during or before 2024 in the
event that Tetris Pharma annual sales reach between GBP7 million to
GBP8 million, with the potential to reach peak sales (assuming c.30
per cent. market penetration) within three to four years of
Completion. These numbers are illustrative only and do not
represent a forecast for the Tetris Pharma business or the
Group.
Details of the Acquisition and SPA
On 1 August 2022, the Company entered into a conditional share
purchase agreement (the " SPA ") pursuant to which the Company
agreed to purchase the entire issued share capital of Tetris Pharma
for consideration payable upon Completion comprising the issue of
651,726 Initial Consideration Shares (credited as fully paid) ,
representing approximately 2.3 per cent. of the existing issued
share capital of Arecor.
The Company has also agreed to discharge certain existing
liabilities of Tetris Pharma with an aggregate value of
approximately GBP2.0 million, such liabilities including, inter
alia, the Inventory Payment and certain other one-off
liabilities.
Up to a further GBP4.0 million deferred consideration may become
payable, consisting of three Earn Out Payments of:
a. GBP1.0 million on the first anniversary following Completion,
subject to Tetris Pharma achieving mid-single-digit million-pound
net sales and a low single-digit million-pound EBITDA loss in the
12-month period following Completion;
b. GBP1.5 million on the second anniversary following
Completion, subject to Tetris Pharma achieving high-teens
million-pound net sales and a small positive EBITDA profit in the
12-month period following the first anniversary of Completion;
and
c. GBP1.5 million on the third anniversary following Completion,
subject to Tetris Pharma achieving double-digit million-pound net
sales and single-digit million-pound EBITDA profit in the 12-month
period following the second anniversary of Completion.
The Earn Out Payments are payable through the issue of either
(i) new Ordinary Shares or (ii) unsecured loan notes having an
aggregate principal value equal to the amount of the relevant Earn
Out Payment, at the Company's election. Any Earn Out Payments
satisfied through the issue of new Ordinary Shares will be issued
at a price equal to the greater of GBP4.05 per share and the 30-day
volume weighted average price of the Ordinary Shares immediately
preceding the date such Earn Out Payment is determined.
The Initial Consideration Shares will, following Admission, rank
in all respects pari passu with the Existing Ordinary Shares. The
Initial Consideration Shares will be issued fully paid and free
from all encumbrances and with the rights set out in its articles
of association.
Completion of the Acquisition is conditional upon the Admission
of the Initial Consideration Shares and the Placing Shares.
If this condition is not satisfied by 6 August 2022, the SPA
shall be terminated unless the parties otherwise agree. The SPA
contains certain customary warranties given by certain of the
Tetris Pharma Sellers in relation to Tetris Pharma and its
business, subject to agreed limitations.
Xeris Licence Agreement
Ogluo(R) is the UK/EU tradename for the US product Gvoke (R)
which was licenced by Tetris Pharma from Xeris.
The exclusive licence and supply agreement with Xeris allows for
sales of Gvoke (R) under the trade name Ogluo(R) in the EEA, UK and
Switzerland. On 15 July 2022, Tetris Pharma amended a 16-year
licence agreement with Xeric and Strongbridge Dublin Limited (the
"Xeris Licence Amendment"). Pursuant to the licence, a
mid-single-digit royalty on net sales is payable to Xeris over the
licence period. In addition, further one-off commercial milestone
payments are payable to Xeris in the event that net revenues exceed
pre-defined targets in any single calendar year. The first of these
triggers is if net revenues from Ogluo(R) exceed mid double-digit
millions in a calendar year. The Xeris Licence Amendment also
contains customary terms and conditions, including certain
performance conditions by Tetris Pharma which, if not met, provide
Xeris with a right of termination.
The Xeris Licence Amendment shall only become effective if
completion of the Acquisition has occurred and the Inventory
Payment has been made, in each case on or prior to 12 August 2022.
If by 12 August 2022 both of these conditions have not been met
then the Xeris Licence Amendment shall terminate and cease to have
any effect.
Lock-in Agreements
Each of the Tetris Pharma Sellers has, pursuant to lock-in
obligations in the SPA, undertaken to the Company and Panmure
Gordon not to dispose of any interests in their respective Initial
Consideration Shares (or Deferred Consideration Shares, if
applicable, in respect of the Earn Out) for 24 months following
Admission and thereafter, for the subsequent 12-month period, any
disposals of interests in their respective Initial Consideration
Shares (or Deferred Consideration Shares) are subject to an orderly
dealing requirement.
The lock-in obligations contain customary exceptions on disposal
of the Initial Consideration Shares including, inter alia, a
transfer pursuant to acceptance of a takeover offer and a transfer
to a family member.
Details of the Placing
Panmure Gordon is acting as nominated adviser, broker and
placing agent in connection with the Placing. Under the terms of
the Placing, Panmure Gordon has agreed to use reasonable endeavours
to place the Placing Shares at the Placing Price to raise
approximately GBP6 million.
The Placing is expected to comprise the placing of EIS/VCT
Placing Shares and the placing of General Placing Shares.
The EIS/VCT Placing is conditional, inter alia, upon:
-- the Company allotting, subject only to EIS/VCT Admission, the
EIS/VCT Placing Shares in accordance with the Placing
Agreement;
-- EIS/VCT Admission taking place not later than 8.00 a.m. on 3
August 2022 (or such later date as may be agreed in writing between
the Company and Panmure Gordon);
-- the SPA:
o having been duly executed by all parties thereto; and
o not having lapsed or been terminated prior to EIS/VCT
Admission pursuant to the terms thereof;
-- the Xeris Licence Amendment:
o having been duly executed by all parties thereto; and
o not having lapsed or been terminated prior to EIS/VCT
Admission pursuant to the terms thereof; and
-- the Company having complied with its obligations under the Placing Agreement.
If any of the conditions above are not satisfied or waived, the
EIS/VCT Placing Shares will not be issued. The EIS/VCT Placing is
not conditional upon completion of the Acquisition. The Acquisition
is expected to complete following the General Admission.
The General Placing is conditional, inter alia, upon:
-- EIS/VCT Admission having occurred and the Company allotting,
subject only to General Admission, the General Placing Shares in
accordance with the Placing Agreement and the Initial Consideration
Shares in accordance with the SPA;
-- General Admission taking place not later than 8.00 a.m. on 4
August 2022 (or such later date as may be agreed in writing between
the Company and Panmure Gordon);
-- the SPA:
o having been duly executed by all parties thereto;
o not having lapsed or been terminated prior to General
Admission pursuant to the terms thereof; and
o having become unconditional in all respects in accordance with
its terms, subject only to General Admission and the issue by the
Company of the Initial Consideration Shares to the Tetris Pharma
Sellers.
-- the Xeris Licence Amendment:
o having been duly executed by all parties thereto;
o not having lapsed or been terminated prior to General
Admission pursuant to the terms thereof;
o having become unconditional in all respects in accordance with
its terms, subject only to the Inventory Payment payable thereunder
and completion of the Acquisition; and
o the Company having complied with its obligations under the
Placing Agreement.
If any of the conditions above are not satisfied, the General
Placing Shares will not be issued. The EIS/VCT Placing is not
conditional on the issue of the General Placing Shares and the
General Admission.
It is expected that certain Directors of the Company will
subscribe for new Ordinary Shares as part of the Placing on the
same terms as other Placees for an aggregate amount of at least
GBP100,000. Further details will be announced as appropriate in due
course.
The proceeds from the Placing, will be used to fund, inter
alia:
-- the payment to Tetris Pharma of c.GBP2.0 million for initial
Ogluo(R) inventory from Xeris and historic one-off liabilities of
Tetris Pharma;
-- provide c.GBP4 million of working capital to Tetris Pharma to
accelerate the roll-out of Ogluo(R) across the UK and Europe and to
provide a line of sight to Tetris Pharma break-even.
The Placing is not underwritten.
The Placing Shares will be issued free of all liens, charges and
encumbrances and will, when issued and fully paid, rank pari passu
in all respects with the Existing Ordinary Shares, including the
right to receive all dividends and other distributions declared,
made or paid after the date of their issue.
Application will be made to the London Stock Exchange for the
admission of the Placing Shares and the Initial Consideration
Shares to trading on AIM. The Placing Shares and the Initial
Consideration Shares will be issued pursuant to the existing
authorities approved at the Company's annual general meeting held
on 23 May 2022. It is expected that: (i) EIS/VCT Admission will
occur, and that dealings in the EIS/VCT Placing Shares subscribed
for pursuant to the EIS/VCT Placing will commence, at 8.00 a.m. on
3 August 2022, at which time it is also expected that the EIS/VCT
Placing Shares subscribed for pursuant to the EIS/VCT Placing will
be enabled for settlement in CREST; and (ii) General Admission will
occur, and that dealings in the Non-EIS/VCT Placing Shares and the
Initial Consideration Shares will commence, at 8.00 a.m. on 4
August 2022, at which time it is also expected that the General
Placing Shares and the Initial Consideration Shares will be enabled
for settlement in CREST.
Panmure Gordon (whether itself or through its affiliates) is
arranging the Placing as placing agent of the Company for the
purpose of using reasonable endeavours to procure Placees at the
Placing Price for the Placing Shares.
Panmure Gordon intends to conditionally place the Placing Shares
with certain institutional and other investors.
The Placing Agreement contains customary warranties given by the
Company to Panmure Gordon as to matters relating to the Company and
its business and a customary indemnity given by the Company to
Panmure Gordon in respect of liabilities arising out of, or in
connection with, the Placing.
Panmure Gordon (after consultation with the Company) reserves
the right to scale back the number of Placing Shares to be
subscribed by any Placee in the event of applications in excess of
the target amount under the Placing. The Company and Panmure Gordon
also reserve the right not to accept offers to subscribe for
Placing Shares or to accept such offer in part rather than in
whole. Panmure Gordon shall be entitled to effect the Placing by
such method as they shall in their sole discretion determine. To
the fullest extent permissible by law, neither Panmure Gordon nor
any holding company of Panmure Gordon nor any subsidiary branch or
affiliate of Panmure Gordon (each an affiliate) nor any person
acting on behalf of any of the foregoing shall have any liability
to the Placees (or to any other person whether acting on behalf of
a Placee or otherwise). In particular, neither Panmure Gordon, nor
any affiliate thereof nor any person acting on their behalf shall
have any liability to Placees in respect of their conduct of the
Placing.
APPIX I
Expected Timetable for the Fundraising
2022
Announcement of the results of the Placing 1 August
EIS/VCT Placing Shares credited to CREST 3 August
stock accounts
EIS/VCT Admission effective and commencement 8:00 a.m. on 3
of dealings in the EIS/VCT Placing Shares August
on AIM commence
General Admission effective and commencement 8:00 a.m. on 4
of dealings in the General Placing Shares August
and the I nitial Consideration Shares on
AIM
General Placing Shares credited to CREST 4 August
stock accounts
Despatch of definitive share certificates within 14 working
in respect of New Ordinary Shares to be days
issued in certificated form
Long Stop Date 5:00 p.m. on 15
August
Notes:
(i) References to times in this Announcement are to London time (unless otherwise stated).
(ii) If any of the above times or dates should change, the
revised times and/or dates will be notified by an announcement to
an RIS.
(iii) The timing of the events in the above timetable is indicative only.
APPIX II
TERMS AND CONDITIONS OF THE PLACING
INTRODUCTION
IMPORTANT INFORMATION FOR INVITED PLACEES ONLY REGARDING THE
PLACING.
THIS ANNOUNCEMENT, INCLUDING THIS APPIX, AND THE INFORMATION IN
IT, IS RESTRICTED, AND IS NOT FOR PUBLICATION, RELEASE OR
DISTRIBUTION, DIRECTLY OR INDIRECTLY, IN WHOLE OR IN PART TO U.S.
PERSONS OR, IN OR INTO THE UNITED STATES, ANY OF THE OTHER
RESTRICTED JURISDICTIONS OR ANY OTHER JURISDICTION IN WHICH SUCH
PUBLICATION OR DISTRIBUTION WOULD BE UNLAWFUL.
THE PLACING SHARES THAT ARE THE SUBJECT OF THE PLACING ARE NOT
BEING OFFERED OR SOLD TO ANY PERSON IN THE EUROPEAN UNION OR THE
UK, OTHER THAN TO QUALIFIED INVESTORS, WHICH INCLUDES LEGAL
ENTITIES WHICH ARE REGULATED BY THE FCA OR ENTITIES WHICH ARE NOT
SO REGULATED WHOSE CORPORATE PURPOSE IS SOLELY TO INVEST IN
SECURITIES.
MEMBERS OF THE PUBLIC IN THE UK OR ELSEWHERE ARE NOT ELIGIBLE TO
TAKE PART IN THE PLACING. THIS ANNOUNCEMENT (INCLUDING THIS APPIX)
AND THE TERMS AND CONDITIONS SET OUT HEREIN ARE FOR INFORMATION
PURPOSES ONLY AND ARE DIRECTED ONLY AT: (A) QUALIFIED INVESTORS;
(B) IN THE UNITED KINGDOM, QUALIFIED INVESTORS WHO ARE PERSONS WHO
(I) FALL WITHIN ARTICLE 19(5) OF THE ORDER, FALL WITHIN ARTICLE
49(2)(A) TO (D) OF THE ORDER OR ARE PERSONS TO WHOM IT MAY
OTHERWISE BE LAWFULLY COMMUNICATED AND (II) ARE A "PROFESSIONAL
CLIENT" OR AN "ELIGIBLE COUNTERPARTY" WITHIN THE MEANING OF CHAPTER
3 OF THE FCA'S CONDUCT OF BUSINESS SOURCEBOOK; OR (C) OTHER PERSONS
TO WHOM IT MAY LAWFULLY BE COMMUNICATED (ALL SUCH PERSONS TOGETHER
BEING REFERRED TO AS "RELEVANT PERSONS"). THIS ANNOUNCEMENT
(INCLUDING THIS APPIX) AND THE TERMS AND CONDITIONS SET OUT HEREIN
MUST NOT BE ACTED ON OR RELIED ON BY PERSONS WHO ARE NOT RELEVANT
PERSONS. ANY INVESTMENT OR INVESTMENT ACTIVITY TO WHICH THIS
ANNOUNCEMENT (INCLUDING THIS APPIX) AND THE TERMS AND CONDITIONS
SET OUT HEREIN RELATES IS AVAILABLE ONLY TO RELEVANT PERSONS AND
WILL BE ENGAGED IN ONLY WITH RELEVANT PERSONS.
THIS APPIX, AND THE ANNOUNCEMENT OF WHICH IT FORMS PART, IS FOR
INFORMATION PURPOSES ONLY AND DOES NOT ITSELF CONSTITUTE AN OFFER
FOR SALE OR SUBSCRIPTION OF ANY SECURITIES IN THE COMPANY. IF YOU
ARE IN ANY DOUBT AS TO WHETHER YOU ARE A RELEVANT PERSON YOU SHOULD
CONSULT A PROFESSIONAL ADVISER FOR ADVICE.
THIS ANNOUNCEMENT, INCLUDING THIS APPIX, IS NOT AN OFFER FOR
SALE OR SUBSCRIPTION IN ANY JURISDICTION IN WHICH SUCH OFFER,
SOLICITATION OR SALE WOULD BE UNLAWFUL UNDER THE SECURITIES LAWS OF
ANY SUCH JURISDICTION. THIS ANNOUNCEMENT, INCLUDING THIS APPIX, IS
NOT AN OFFER OF OR SOLICITATION TO PURCHASE OR SUBSCRIBE FOR
SECURITIES IN THE UNITED STATES.
EACH PLACEE SHOULD CONSULT WITH ITS OWN ADVISERS AS TO LEGAL,
TAX, BUSINESS AND RELATED ASPECTS OF AN INVESTMENT IN PLACING
SHARES. THE PRICE OF THE PLACING SHARES IN THE COMPANY AND THE
INCOME FROM THEM (IF ANY) MAY GO DOWN AS WELL AS UP AND INVESTORS
MAY NOT GET BACK THE FULL AMOUNT INVESTED ON DISPOSAL OF THE
PLACING SHARES.
Placees will be deemed to have read and understood this A
nnouncement and these terms and conditions in their entirety and to
be making such offer on the terms and conditions and to be
providing the representations, warranties, acknowledgements, and
undertakings contained in this Appendix. In particular, each such
Placee represents, warrants and acknowledges 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 any Placing Shares acquired by it as a
financial intermediary, as that term is used in Article 5(1) of the
Prospectus Regulation, (i) the Placing Shares acquired by it have
not been acquired on behalf of, nor have they been acquired with a
view to their offer or resale to, persons in any Member State of
the EEA or the UK other than Qualified Investors or in
circumstances in which the prior consent of Panmure Gordon has been
given to the offer or resale; or (ii) where Placing Shares have
been acquired by it on behalf of persons in any Member State of the
EEA or the UK other than Qualified Investors, the offer of those
Placing Shares to it is not treated under the Prospectus Regulation
as having been made to such persons; and/or
3. (i) (1) it is not a U.S. Person, (2) it is not located in the
United States, and (3) it is not acquiring the Placing Shares for
the account or benefit of a U.S. Person; or (ii) it is a dealer or
other professional fiduciary in the United States acting for a
discretionary account (other than an estate or trust) held for the
benefit or account of a non U.S. Person in reliance on Regulation
S.
The Company and Panmure Gordon will rely upon the truth and
accuracy of the foregoing representations, acknowledgements and
agreements. Panmure Gordon does not make any representation to any
Placee regarding an investment in the Placing Shares referred to in
this A nnouncement (including this Appendix).
This A nnouncement (including this Appendix) does not constitute
an offer, and may not be used in connection with an offer, to sell
or issue or the solicitation of an offer to buy or subscribe for
Placing Shares in any jurisdiction in which such offer or
solicitation is or may be unlawful. This Announcement (including
this Appendix) and the information contained herein is not for
publication or distribution, directly or indirectly, to persons in
the United States, any of the other Restricted Jurisdictions or in
any jurisdiction in which such publication or distribution is
unlawful. Persons who come into possession of this Announcement are
required by the Company to inform themselves about and to observe
any restrictions of transfer of this Announcement . No public offer
of securities of the Company under the Placing is being made in the
United Kingdom, the United States or any Restricted
Jurisdiction.
In particular, the Placing Shares referred to in this
Announcement have not been and will not be registered under the
Securities Act or under any laws of, or with any securities
regulatory authority of, any state or other jurisdiction of the
United States, and may not be offered, sold, resold, transferred or
delivered, directly or indirectly, in the United States or to, or
for the account or benefit of, U.S. Persons, 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 in the United States, and under circumstances that
would not result in the Company being required to register under
the U.S. Investment Company Act of 1940. The Placing Shares are
only being offered and sold outside the United States in offshore
transactions to persons who are not U.S. Persons in accordance with
Regulation S under the Securities Act.
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; and the Placing Shares have
not been, nor will they be, registered under or offered in
compliance with the securities laws of any state, province or
territory of any of the Restricted Jurisdictions. Accordingly, the
Placing Shares may not (unless an exemption under the relevant
securities laws is applicable) be offered, sold, resold or
delivered, directly or indirectly, in or into the Restricted
Jurisdictions or any other jurisdiction outside the United
Kingdom.
Persons (including, without limitation, nominees and trustees)
who have a contractual or other legal obligation to forward a copy
of this Appendix or the Announcement of which it forms part should
seek appropriate advice before taking any action.
DETAILS OF THE PLACING
Panmure Gordon having entered into the Placing Agreement with
the Company under which Panmure Gordon has, on the terms and
subject to the conditions set out therein, undertaken to use its
reasonable endeavours to procure, as agents for the Company,
subscribers for the Placing Shares at the Placing Price.
The Placing Agreement contains customary warranties given by the
Company to Panmure Gordon as to matters relating to the Company and
its business and a customary indemnity given by the Company to
Panmure Gordon in respect of liabilities arising out of, or in
connection with, the Placing.
Panmure Gordon (after consultation with the Company) reserves
the right to scale back the number of Placing Shares to be
subscribed by any Placee in the event of applications in excess of
the target amount under the Placing. The Company and Panmure Gordon
also reserves the right not to accept offers to subscribe for
Placing Shares or to accept such offer in part rather than in
whole. Panmure Gordon shall be entitled to effect the Placing by
such method as it shall in its sole discretion determine. To the
fullest extent permissible by law, neither Panmure Gordon nor any
holding company of Panmure Gordon nor any subsidiary branch or
affiliate of Panmure Gordon (each an affiliate) nor any person
acting on behalf of any of the foregoing shall have any liability
to the Placees (or to any other person whether acting on behalf of
a Placee or otherwise). In particular, neither Panmure Gordon, nor
any affiliate thereof nor any person acting on their behalf shall
have any liability to Placees in respect of their conduct of the
Placing.
Each Placee's obligations will be owed to the Company and to
Panmure Gordon. Following the confirmation referred to below in the
paragraph entitled "Participation in, and principal terms of, the
Placing", each Placee will also have an immediate, separate,
irrevocable and binding obligation, owed to Panmure Gordon, to pay
to Panmure Gordon (or as Panmure Gordon may direct) in cleared
funds an amount equal to the product of the Placing Price and the
number of Placing Shares which such Placees has agreed to
acquire.
Each Placee agrees to indemnify on demand and hold each of
Panmure Gordon and the Company, and their respective affiliates
harmless from any all costs, claims, liabilities and expenses
(including legal fees and expenses) arising out of or in connection
with any breach of the acknowledgments, undertakings,
representations, warranties and agreements set forth in these terms
and conditions.
The Placing is also conditional upon the Placing Agreement
becoming unconditional and the Placing Agreement not being
terminated in accordance with its terms. Further details of
conditions in relation to the Placing are set out below in the
paragraph entitled "Conditions of the Placing".
A Placee agrees to become a member of the Company and agrees to
subscribe for those Placing Shares allocated to it by Panmure
Gordon at the Placing Price, conditional on: (i) in respect of the
EIS/VCT Placing Shares, EIS/VCT Admission occurring and becoming
effective by 8.00 a.m. on 3 August 2022 and, in the case of the in
respect of the General Placing Shares, General Admission occurring
and becoming effective by 8.00 a.m. on 4 August 2022 (or, in either
such case, such later time and/or date, not being later than 8.00
a.m. on 4 August 2022, as the Company and Panmure Gordon may
agree); (ii) the Placing Agreement becoming otherwise unconditional
in all relevant respects and not having been terminated in
accordance with its terms on or before the date of the relevant
Admission; and (iii) Panmure Gordon confirming to the Placees their
allocation of Placing Shares.
To the fullest extent permitted by law, each Placee acknowledges
and agrees that it will not be entitled to exercise any remedy of
rescission at any time. This does not affect any other rights the
Placee may have.
The EIS/VCT Placing is not conditional on the issue of the
General Placing Shares and General Admission. Investors should note
that it is possible that EIS/VCT Admission will occur but General
Admission will not occur.
The Placing Shares will, when issued, be subject to the articles
of association of the Company, be credited as fully paid and rank
pari passu in all respects with the existing Ordinary Shares in
issue, including the right to receive all dividends and other
distributions (if any) declared, made or paid on or in respect of
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. It is expected that settlement of the EIS/VCT Placing
Shares and EIS/VCT Admission will become effective on or around
8.00 a.m. on 3 August 2022 and that dealings in the EIS/VCT Placing
Shares will commence at that time. It is expected that settlement
of the General Placing Shares and the Initial Consideration Shares
and General Admission will become effective on or around 8.00 a.m.
on 4 August 2022 and that dealings in the General Placing Shares
and the Initial Consideration Shares will commence at that
time.
PAYMENT FOR SHARES
Each Placee has a separate, irrevocable and binding obligation
to pay the Placing Price in cleared funds for the number of Placing
Shares duly allocated to the Placee under the Placing in the manner
and by the time directed by Panmure Gordon. If any Placee fails to
pay as so directed and/or by the time directed, the relevant
Placee's application for Placing Shares shall at Panmure Gordon's
discretion either be rejected or accepted in which case the
paragraph below entitled "Registration and Settlement" shall apply
to such application.
PARTICIPATION IN, AND PRINCIPAL TERMS OF, THE PLACING
Panmure Gordon (whether itself or through its affiliates) is
arranging the Placing as placing agent of the Company for the
purpose of using reasonable endeavours to procure Placees at the
Placing Price for the Placing Shares.
Participation in the Placing will only be available to persons
who may lawfully be, and are, invited to participate by Panmure
Gordon. Panmure Gordon and its affiliates may participate in the
Placing as principal.
By participating in the Placing, Placees will be deemed to have
read and understood this Announcement , including this Appendix, in
its entirety and to be participating and making an offer for
Placing Shares on the terms and conditions, and to be providing the
representations, warranties, acknowledgements, agreements and
undertakings contained in this Appendix.
This Appendix gives details of the terms and conditions of, and
the mechanics of participation in, the Placing. No commissions will
be paid to Placees or by Placees in respect of any Placing
Shares.
The number of Placing Shares to be issued, and the extent of
each Placee's participation in the Placing (which will not
necessarily be the same for each Placee), will be agreed between
Panmure Gordon (following consultation with the Company) following
completion of the book building process in respect of the Placing
(the "Bookbuild"). No element of the Placing will be underwritten.
The aggregate number of Placing Shares will be announced on a
Regulatory Information Service following completion of the
Bookbuild.
A Placee's commitment to acquire a fixed number of Placing
Shares under the Placing will be agreed orally with Panmure Gordon
as agent of the Company. Each Placee's allocation will be confirmed
to Placees orally or by email by Panmure Gordon, and a form of
confirmation will be dispatched as soon as possible thereafter. The
oral or email confirmation to such Placee will constitute an
irrevocable legally binding commitment upon such person (who will
at that point become a Placee) in favour of Panmure Gordon and the
Company, under which it agrees to acquire the number of Placing
Shares allocated to it at the Placing Price on the terms and
conditions set out in this Appendix and in accordance with the
articles of incorporation of the Company.
Except as required by law or regulation, no press release or
other announcement will be made by Panmure Gordon or the Company
using the name of any Placee (or its agent), in its capacity as
Placee (or agent), other than with such Placee's prior written
consent.
Irrespective of the time at which a Placee's allocation pursuant
to the Placing is confirmed, settlement for all Placing Shares to
be acquired pursuant to the Placing will be required to be made on
the basis explained below under the paragraph entitled
"Registration and Settlement".
All obligations under the Placing will be subject to fulfilment
or (where applicable) waiver of, amongst other things, the
conditions referred to below and to the Placing not being
terminated on the basis referred to below.
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.
To the fullest extent permissible by law, none of the Company,
Panmure Gordon or any of their respective affiliates shall have any
liability to Placees (or to any other person whether acting on
behalf of a Placee or otherwise under these terms and conditions).
In particular, none of the Company, Panmure Gordon or any of their
respective affiliates shall have any liability (including to the
fullest extent permissible by law, any fiduciary duties) in respect
of Panmure Gordon's conduct of the Placing. Each Placee
acknowledges and agrees that the Company is responsible for the
issue of the Placing Shares to the Placees and Panmure Gordon shall
have no liability to the Placees for the failure of the Company to
fulfil those obligations.
CONDITIONS OF THE PLACING
Panmure Gordon's obligations under the Placing Agreement in
respect of the EIS/VCT Placing Shares are conditional on, inter
alia:
1. the Company allotting, subject only to EIS/VCT Admission, the
EIS/VCT Placing Shares in accordance with the Placing
Agreement;
2. EIS/VCT Admission taking place not later than 8.00 a.m. on 3
August 2022 (or such later date as may be agreed in writing between
the Company and Panmure Gordon);
3. the Tetris Pharma SPA:
a. having been duly executed by all parties thereto; and
b. not having lapsed or been terminated prior to EIS/VCT Admission pursuant to the terms thereof;
4. the Xeris Licence Amendment:
a. having been duly executed by all parties thereto; and
b. not having lapsed or been terminated prior to EIS/VCT
Admission pursuant to the terms thereof; and
5. the Company having complied with its obligations under the Placing Agreement.
If (a) any of the conditions contained in the Placing Agreement
in relation to the EIS/VCT Placing Shares are not fulfilled or
waived by Panmure Gordon by the respective time or date where
specified (or such later time or date as the Company and Panmure
Gordon may agree not being later than 5.00 p.m. on 15 August 2022
(the "Final Date")); or (b) the Placing Agreement is terminated as
described below, the Placing in relation to the EIS/VCT Placing
Shares will lapse and the Placees' rights and obligations hereunder
in relation to the EIS/VCT Placing Shares shall cease and terminate
at such time and each Placee agrees that no claim can be made by
the Placee in respect thereof.
The EIS/VCT Placing is not conditional on completion of the
Acquisition, the issue of the General Placing Shares or General
Admission. Investors should note that it is possible that EIS/VCT
Admission will occur but the Acquisition and General Admission will
not occur.
Panmure Gordon's obligations under the Placing Agreement in
respect of the General Placing Shares are conditional on, inter
alia:
1. EIS/VCT Admission having occurred and the Company allotting,
subject only to General Admission, the General Placing Shares in
accordance with the Placing Agreement and the Initial Consideration
Shares in accordance with the Tetris Pharma SPA;
2. General Admission taking place not later than 8.00 a.m. on 4
August 2022 (or such later date as may be agreed in writing between
the Company and Panmure Gordon);
3. the Tetris Pharma SPA:
a. having been duly executed by all parties thereto;
b. not having lapsed or been terminated prior to General
Admission pursuant to the terms thereof; and
c. having become unconditional in all respects in accordance
with its terms, subject only to General Admission and the issue by
the Company of the Initial Consideration Shares to the Tetris
Pharma Sellers;
4. the Xeris Licence Amendment:
a. having been duly executed by all parties thereto;
b. not having lapsed or been terminated prior to General Admission pursuant to the terms thereof;
c. having become unconditional in all respects in accordance
with its terms, subject only to payment of the Inventory Payment
and completion of the Acquisition; and
5. the Company having complied with its obligations under the Placing Agreement.
If (a) any of the conditions contained in the Placing Agreement
in relation to the General Placing Shares are not fulfilled or
waived by Panmure Gordon by the respective time or date where
specified (or such later time or date as the Company and Panmure
Gordon may agree not being later than 5.00 p.m. on the Long Stop
Date); or (b) the Placing Agreement is terminated as described
below, the Placing in relation to the General Placing Shares will
lapse and the Placees' rights and obligations hereunder in relation
to the General Placing Shares shall cease and terminate at such
time and each Placee agrees that no claim can be made by the Placee
in respect thereof.
Subject to certain exceptions, Panmure Gordon may, at its
absolute discretion and upon such terms as it thinks fit, waive, or
extend the period (up to the Long Stop Date) for, compliance by the
Company with the whole or any part of any of the Company's
obligations in relation to the conditions in the Placing Agreement.
Any such extension or waiver will not affect Placees' commitments
as set out in this Announcement .
Neither Panmure Gordon nor the Company shall have any liability
to any Placee (or to any other person whether acting on behalf of a
Placee or otherwise) in respect of any decision they may make as to
whether or not to waive or to extend the time and/or date for the
satisfaction of any condition to the Placing nor for any decision
they may make as to the satisfaction of any condition or in respect
of the Placing generally and by participating in the Placing each
Placee agrees that any such decision is within the absolute
discretion of Panmure Gordon.
RIGHT TO TERMINATE UNDER THE PLACING AGREEMENT
Panmure Gordon is entitled, at any time before either Admission,
to terminate the Placing Agreement in respect of the EIS/VCT
Placing Shares at any time before EIS/VCT Admission and in respect
of the General Placing Shares at any time before General Admission
by giving notice to the Company in certain circumstances,
including, inter alia:
1. where the Company has failed to comply with any of its
obligations under the Placing Agreement which is material in the
context of the Group, the Placing, EIS/VCT Admission and/or General
Admission; or
2. where there has been a breach of the SPA or the Xeris Licence
Amendment by any party which is, in Panmure Gordon's opinion,
material in the context of the Group, the Placing, EIS/VCT
Admission and/or General Admission or any party to the SPA or the
Xeris Licence Amendment has terminated or rescinded (or purported
to terminate or rescind) such agreement;
3. where any of the warranties given by the Company to Panmure
Gordon under the Placing Agreement not being true or accurate or
being misleading when given or would not be true and accurate or
would be misleading if repeated (by reference to the facts and
circumstances in each case then existing) in a respect which is
material in the context of the Group, the Placing, EIS/VCT
Admission and/or General Admission; or
4. where, amongst other things, there is a material adverse
change in the condition, earnings, business, operations or
prospects of the Group or if there is a material adverse change in
the financial, political, economic or stock market conditions,
which in Panmure Gordon's reasonable opinion (acting in good faith)
makes it impractical or inadvisable to proceed with the
Placing.
Following General Admission, the Placing Agreement is not
capable of termination to the extent that it relates to the Placing
of the Placing Shares.
The rights and obligations of the Placees shall terminate only
in the circumstances described in these terms and conditions and in
the Placing Agreement and will not be subject to termination by the
Placee or any prospective Placee at any time or in any
circumstances. By participating in the Placing, Placees agree that
the exercise by Panmure Gordon of any right of termination or other
discretion under the Placing Agreement shall be within the absolute
discretion of Panmure Gordon, and that it need not make any
reference to Placees and that it shall have no liability to Placees
whatsoever in connection with any such exercise or decision not to
exercise. Placees will have no rights against Panmure Gordon, the
Company or any of their respective directors or employees under the
Placing Agreement pursuant to the Contracts (Rights of Third
Parties) Act 1999 (as amended).
NO PROSPECTUS
The Placing Shares are being offered to Relevant Persons only
and will not be offered in such a way as to require a prospectus in
the United Kingdom or elsewhere. No offering document or prospectus
has been or will be submitted to be approved by the FCA in relation
to the Placing and Placees' commitments will be made solely on the
basis of the information contained in this Announcement (including
this Appendix) and certain business and financial information the
Company is required to publish in accordance with the AIM Rules and
the rules and practices of the FCA (collectively "Exchange
Information").
Each Placee, by accepting a participation in the Placing, agrees
that the content of this Announcement , including this Appendix, is
exclusively the responsibility of the Company and confirms that it
has not relied on any other information (other than the Exchange
Information), representation, warranty, or statement made by or on
behalf of the Company or Panmure Gordon or any other person and
neither of Panmure Gordon nor the Company nor any other person will
be liable for any Placee's decision to participate in the Placing
based on any other information, representation, warranty or
statement which the Placees may have obtained or received. Each
Placee acknowledges and agrees that it has relied on its own
investigation of the business, financial or other position of the
Company in accepting a participation in the Placing. Nothing in
this paragraph shall exclude the liability of any person for
fraudulent misrepresentation.
REGISTRATION AND SETTLEMENT
Settlement of transactions in the Placing Shares (ISIN:
GB00BMWLM973) following Admission will take place within CREST
provided that, subject to certain exceptions, Panmure Gordon
reserves the right to require settlement for, and delivery of, the
Placing Shares (or a portion thereof) to Placees by such other
means that it may deem necessary if delivery or settlement is not
possible or practicable within CREST within the timetable set out
in this Announcement or would not be consistent with the regulatory
requirements in any Placee's jurisdiction.
Each Placee allocated Placing Shares in the Placing will be sent
a trade confirmation stating the number of Placing Shares allocated
to it at the Placing Price, the aggregate amount owed by such
Placee to Panmure Gordon (as agent for the Company) and settlement
instructions. Each Placee agrees that it will do all things
necessary to ensure that delivery and payment is completed in
accordance with either the CREST or certificated settlement
instructions that it has in place with Panmure Gordon.
Settlement of transactions in the Placing Shares (ISIN:
GB00BMWLM973) following the relevant Admission will take place
within the CREST system, subject to certain exceptions. Settlement
through CREST of the EIS/VCT Placing Shares is expected to take
place on 3 August 2022 unless otherwise notified by Panmure Gordon
and EIS/VCT Admission is expected to occur no later than 8.00 a.m.
on 3 August 2022 unless otherwise notified by Panmure Gordon.
Settlement through CREST of the General Placing Shares is expected
to take place on 4 August 2022 unless otherwise notified by Panmure
Gordon and General Admission is expected to occur no later than
8.00 a.m. on 4 August 2022 unless otherwise notified by Panmure
Gordon.
The relevant Admission and settlement may occur at an earlier
date. 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 Panmure Gordon may agree
that the Placing Shares should be issued in certificated form.
Panmure Gordon reserves the right to require settlement for the
Placing Shares, and to deliver the Placing Shares to Placees, by
such other means as it may 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 at the rate of two percentage points above Libor as
determined by Panmure Gordon.
Each Placee is deemed to agree that, if it does not comply with
these obligations, Panmure Gordon may sell any or all of the
Placing Shares allocated to that Placee on such Placee's behalf and
retain from the proceeds, for Panmure Gordon's account and benefit
(as agent for the Company), an amount equal to the aggregate amount
owed by the Placee plus any interest due. Any excess proceeds will
pass to the relevant Placee at its risk. The relevant Placee will,
however, remain liable and shall indemnify Panmure Gordon on demand
for any shortfall below the aggregate amount owed by it and may be
required to bear any stamp duty or stamp duty reserve tax or
securities transfer tax (together with any interest or penalties)
which may arise upon the sale of such Placing Shares on such
Placee's behalf. By communicating a bid for Placing Shares, each
Placee confers on Panmure Gordon all such authorities and powers
necessary to carry out any such sale and agrees to ratify and
confirm all actions which Panmure Gordon lawfully take in pursuance
of such sale.
If Placing Shares are to be delivered to a custodian or
settlement agent, Placees should ensure that the trade confirmation
is copied and delivered immediately to the relevant person within
that organisation.
Insofar as Placing Shares are registered in a Placee's name or
that of its nominee or in the name of any person for whom a Placee
is contracting as agent or that of a nominee for such person, such
Placing Shares should, subject as provided below, be so registered
free from any liability to UK stamp duty or stamp duty reserve tax
or securities transfer tax. Placees will not be entitled to receive
any fee or commission in connection with the Placing.
REPRESENTATIONS, WARRANTIES AND FURTHER TERMS
By participating in the Placing, each Placee (and any person
acting on such Placee's behalf) makes the following
representations, warranties, acknowledgements, agreements and
undertakings (as the case may be) to the Company and Panmure
Gordon, namely that, each Placee (and any person acting on such
Placee's behalf):
1. represents and warrants that it has read and understood this
Announcement , including this Appendix, in its entirety and that
its subscription of Placing Shares is subject to, and based upon,
all the terms, conditions, representations, warranties,
acknowledgements, agreements and undertakings and other information
contained herein and undertakes not to redistribute or duplicate
this Announcement (including this Appendix);
2. acknowledges that no offering document or prospectus has been
prepared in connection with the placing of the Placing Shares and
represents and warrants that it has not received a prospectus or
other offering document in connection therewith;
5. acknowledges that the Placing Shares are admitted to trading
on AIM, and the Company is therefore required to publish certain
business and financial information in accordance with the AIM Rules
(collectively the "Exchange Information"), 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 the Placee 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;
6. acknowledges that the content of this Announcement (including
this Appendix) is exclusively the responsibility of the Company,
and that none of Panmure Gordon, its affiliates or any person
acting on their behalf has or shall have any liability for any
information, representation or statement contained in this
Announcement (including this Appendix) or any information
previously or concurrently published by or on behalf of the Company
(including any Exchange Information), and will not be liable for
any Placee's decision to participate in the Placing based on any
information, representation or statement contained in this
Announcement (including this Appendix) or otherwise. Each Placee
further represents, warrants and agrees that the only information
on which it is entitled to rely and on which such Placee has relied
in committing itself to acquire the Placing Shares is contained in
this Announcement (including this Appendix) and any Exchange
Information, such information being all that it deems necessary to
make an investment decision in respect of the Placing Shares and
that it has neither received nor relied on any other information
given or representations, warranties or statements made by Panmure
Gordon or the Company or any of their respective directors,
officers or employees or any person acting on behalf of any of them
(including with respect to the Company, the Placing, the Placing
Shares or the accuracy, completeness or adequacy of any publicly
available information), or, if received, it has not relied upon any
such information, representations, warranties or statements, and
neither of Panmure Gordon nor the Company will be liable for any
Placee's decision to accept an invitation to participate in the
Placing based on any other information, representation, warranty or
statement. Each Placee further acknowledges and agrees that it may
not place the same degree of reliance on this Announcement as it
may otherwise place on a prospectus or admission document. Each
Placee further acknowledges and agrees that it has relied solely on
its own investigation of the business, financial or other position
of the Company and the terms of the Placing in deciding to
participate in the Placing and it will not rely on any
investigation that Panmure Gordon, their affiliates or any other
person acting on their behalf has or may have conducted;
7. represents and warrants that it has neither received nor
relied on any confidential price sensitive information concerning
the Company in accepting this invitation to participate in the
Placing;
8. acknowledges that Panmure Gordon does not have any duties or
responsibilities to it, or its clients, similar or comparable to
the duties of "best execution" and "suitability" imposed by the
Conduct of Business Sourcebook in the FCA's Handbook of Rules and
Guidance and that Panmure Gordon is not acting for it or its
clients and that Panmure Gordon will not be responsible for
providing protections to it or its clients;
9. acknowledges that none of Panmure Gordon, any of its
affiliates or any person acting on behalf of them has or shall have
any liability for any publicly available or filed information
(including any Exchange 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;
10. acknowledges that, save in the event of fraud on the part of
Panmure Gordon (and to the extent permitted by the FCA), none of
Panmure Gordon, its ultimate holding company nor any direct or
indirect subsidiary undertakings of such holding company, nor any
of their respective directors and employees shall be liable to
Placees for any matter arising out of Panmure Gordon's role as
placing agent or otherwise in connection with the Placing and that
where any such liability nevertheless arises as a matter of law,
Placees will immediately waive any claim against any of such
persons which it may have in respect thereof;
11. represents and warrants that (a) (i) it is not in the United
States; (ii) it is not a U.S. Person; and (iii) it is not acting
for the account or benefit of a U.S. Person or (b) it is a dealer
or other professional fiduciary in the United States acting for a
discretionary account (other than an estate or trust) held for the
benefit or account of a non U.S. Person in reliance on Regulation
S;
12. acknowledges that the Placing Shares are only being offered
and sold outside the United States in offshore transactions to
persons who are not U.S. Persons pursuant to Regulation S under the
Securities Act, and the Placing Shares have not been and will not
be registered under the Securities Act or under any laws of, or
with any securities regulatory authority of, any state or other
jurisdiction of the United States, and agrees not to reoffer,
resell, pledge, transfer or deliver any Placing Shares, directly or
indirectly, in the United States or to, or for the account or
benefit of, U.S. Persons, 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 in the United States;
13. unless otherwise specifically agreed in writing with Panmure
Gordon, represents and warrants that neither it nor the beneficial
owner of such Placing Shares will be a resident of the Restricted
Jurisdictions;
14. acknowledges that the Placing Shares have not been and will
not be registered under the securities legislation of the
Restricted Jurisdictions and, subject to certain exceptions, may
not be offered, sold, taken up, renounced or delivered or
transferred, directly or indirectly, within those
jurisdictions;
15. represents and warrants that the issue to it, or the person
specified by it for registration as holder, of Placing Shares will
not give rise to a liability under any of sections 67, 70, 93 or 96
of the Finance Act 1986 (depositary receipts and clearance
services) and that the Placing Shares are not being acquired in
connection with arrangements to issue depositary receipts or to
transfer Placing Shares into a clearance system;
16. represents and warrants that: (i) it has complied with and
will continue to comply with its obligations under the Market Abuse
Regulation (EU) No. 596/2014, Criminal Justice Act 1993 and Part
VIII of the Financial Services and Markets Act 2000, as amended
("FSMA") and other applicable law; (ii) in connection with money
laundering and terrorist financing, it has complied with its
obligations under the Proceeds of Crime Act 2002 (as amended), the
Terrorism Act 2000 (as amended), the Terrorism Act 2006, the Money
Laundering, Terrorist Financing and Transfer of Funds (Information
on the Payer) 2017 Regulations, and any other applicable law (where
all such legislation listed under this (ii) shall together be
referred to as the "AML Legislation"); and (iii) it is not a
person: (1) with whom transactions are prohibited under the Foreign
Corrupt Practices Act of 1977 or any economic sanction programmes
administered by, or regulations promulgated by, the Office of
Foreign Assets Control of the U.S. Department of the Treasury; (2)
named on the Consolidated List of Financial Sanctions Targets
maintained by HM Treasury of the United Kingdom; or (3) subject to
financial sanctions imposed pursuant to a regulation of the EU or a
regulation adopted by the United Nations (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 and pursuant to AML Legislation and has obtained all
governmental and other consents (if any) which may be required for
the purpose of, or as a consequence of, such purchase, and it will
provide promptly to Panmure Gordon or the Company such evidence, if
any, as to the identity or location or legal status of any person
(including in relation to the beneficial ownership of any
underlying investor) which Panmure Gordon or the Company may
request from it in connection with the Placing (for the purpose of
complying with such Regulations or ascertaining the nationality of
any person or the jurisdiction(s) to which any person is subject or
otherwise or any other information as may be required to comply
with legal or regulatory requirements (including in particular
under the AML Legislation)) in the form and manner requested by
Panmure Gordon or the Company on the basis that any failure by it
to do so may result in the number of Placing Shares that are to be
purchased by it or at its direction pursuant to the Placing being
reduced to such number, or to nil, as Panmure Gordon may decide at
its sole discretion;
17. if a financial intermediary, as that term is used in Article
5(1) of the Prospectus Regulation, represents and warrants that the
Placing Shares purchased 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 or the UK other than Qualified Investors,
or in circumstances in which the prior consent of Panmure Gordon
has been given to the offer or resale;
18. represents and warrants that it has not offered or sold and
will not offer or sell any Placing Shares to persons in the EEA or
the UK prior to 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 in and which will not result in an offer to the public in
any Member State of the EEA or the UK within the meaning of the
Prospectus Regulation;
19. represents and warrants that it has only communicated or
caused to be communicated and will only communicate or cause to be
communicated any invitation or inducement to engage in investment
activity (within the meaning of section 21 of the FSMA) relating to
the Placing Shares in circumstances in which section 21(1) of the
FSMA does not require approval of the communication by an
authorised person;
20. represents and warrants that it has complied and will comply
with all applicable provisions of the FSMA and the Financial
Services Act 2012 with respect to anything done by it in relation
to the Placing Shares in, from or otherwise involving, the United
Kingdom;
21. if in the United Kingdom, represents and warrants that it is
a person who: (i) falls with Articles 49(2)(A) to (D) or 19(5) of
the Order or it is a person to whom the Placing Shares may
otherwise be lawfully offered under such Order or, if it is
receiving the offer in circumstances under which the laws or
regulations of a jurisdiction other than the United Kingdom would
apply, it is a person to whom the Placing Shares may be lawfully
offered under that other jurisdiction's laws and regulations; and
(ii) is a "professional client" or an "eligible counterparty"
within the meaning of Chapter 3 of the FCA's Conduct of Business
Sourcebook;
22. represents and warrants that it and any person acting on its
behalf is entitled to acquire the Placing Shares under the laws of
all relevant jurisdictions and that it has all necessary capacity
and has obtained all necessary consents and authorities and taken
any other necessary actions to enable it to commit to this
participation in the Placing and to perform its obligations in
relation thereto (including, without limitation, in the case of any
person on whose behalf it is acting, all necessary consents and
authorities to agree to the terms set out or referred to in this
Announcement (including this Appendix)) and will honour such
obligations;
23. where it is acquiring Placing Shares for one or more managed
accounts, represents and warrants that it is authorised in writing
by each managed account: (i) to acquire the Placing Shares for each
managed account; (ii) to make on its behalf the representations,
warranties, acknowledgements, undertakings and agreements in this
Appendix and the Announcement of which it forms part; and (iii) to
receive on its behalf any investment letter relating to the Placing
in the form provided to it by Panmure Gordon;
24. undertakes that it (and any person acting on its behalf)
will make payment for the Placing Shares allocated to it in
accordance with this Announcement (including this Appendix) on the
due time and date set out herein, failing which the relevant
Placing Shares may be placed with other subscribers or sold as
Panmure Gordon may in its sole discretion determine and without
liability to such Placee and it will remain liable and will
indemnify Panmure Gordon on demand for any shortfall below the net
proceeds of such sale and the placing proceeds of such Placing
Shares and may be required to bear the liability for any stamp duty
or stamp duty reserve tax or security transfer tax (together with
any interest or penalties due pursuant to or referred to in these
terms and conditions) which may arise upon the placing or sale of
such Placee's Placing Shares on its behalf;
25. acknowledges that none of Panmure Gordon, any of its
affiliates, or 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 Placing and that participation in the Placing is on the
basis that it is not and will not be treated for these purposes as
a client of Panmure Gordon and that Panmure Gordon does not have
any duties or responsibilities to it for providing the protections
afforded to its clients or customers or for providing advice in
relation to the Placing nor in respect of any representations,
warranties, undertakings or indemnities contained in the Placing
Agreement nor for the exercise or performance of any of their
rights and obligations thereunder, including any rights to waive or
vary any conditions or exercise any termination right;
26. undertakes that the person whom it specifies for
registration as holder of the Placing Shares will be (i) itself; or
(ii) its nominee, as the case may be. Neither Panmure Gordon 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 participate in the Placing and it agrees to
indemnify the Company and Panmure Gordon in respect of the same on
the basis that the Placing Shares will be issued to the CREST stock
account of Panmure Gordon who will hold them as nominee on behalf
of such Placee until settlement in accordance with its standing
settlement instructions;
27. acknowledges that these terms and conditions and any
agreements entered into by it pursuant to these terms and
conditions and any non-contractual obligations arising out of or in
connection with such agreement shall be governed by and construed
in accordance with the laws of England and it submits (on behalf of
itself and on behalf of any person on whose behalf it is acting) to
the exclusive jurisdiction of the English courts as regards any
claim, dispute or matter (including non-contractual matters)
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 Panmure Gordon 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;
28. acknowledges that time shall be of the essence as regards to
obligations pursuant to this Appendix;
29. agrees that the Company, Panmure Gordon and their respective
affiliates and others will rely upon the truth and accuracy of the
foregoing representations, warranties, acknowledgements and
undertakings which are given to Panmure Gordon on its own behalf
and on behalf of the Company and are irrevocable and are
irrevocably authorised to produce this Announcement or a copy
thereof to any interested party in any administrative or legal
proceeding or official inquiry with respect to the matters covered
hereby;
30. agrees to indemnify on an after-tax basis and hold the
Company, Panmure Gordon and their respective affiliates harmless
from any and all costs, claims, liabilities and expenses (including
legal fees and expenses) arising out of or in connection with any
breach of the representations, warranties, acknowledgements,
agreements and undertakings in this Appendix and further agrees
that the provisions of this Appendix shall survive after completion
of the Placing;
31. acknowledges that no action has been or will be taken by any
of the Company, Panmure Gordon or any person acting on behalf of
the Company or Panmure Gordon that would, or is intended to, permit
a public offer of the Placing Shares in any country or jurisdiction
where any such action for that purpose is required;
32. acknowledges that it is an institution that 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 in
this sector and is aware that it may be required to bear, and it,
and any accounts for which it may be acting, are able to bear, the
economic risk of, and is able to sustain, a complete loss in
connection with the Placing. It has relied upon its own examination
and due diligence of the Company and its associates taken as a
whole, and the terms of the Placing, including the merits and risks
involved;
33. acknowledges that its commitment to subscribe for Placing
Shares on the terms set out herein and in the trade confirmation
will continue, notwithstanding any amendment that may in the future
be made to the terms 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 conduct of the Placing;
34. acknowledges that Panmure Gordon or any of its affiliates
acting as an investor for its own account may take up shares in the
Company and in that capacity may retain, purchase or sell for its
own account such shares and may offer or sell such shares other
than in connection with the Placing;
35. represents and warrants that, if it is a pension fund or
investment company, its purchase of Placing Shares is in full
compliance with all applicable laws and regulation; and
36. to the fullest extent permitted by law, it acknowledges and
agrees to the disclaimers contained in the Announcement , including
this Appendix.
The representations, warranties, acknowledgments and
undertakings contained in this Appendix are given to Panmure Gordon
and the Company and are irrevocable and shall not be capable of
termination in any circumstances.
The agreement to settle a Placee's subscription (and/or the
subscription of a person for whom such Placee is contracting as
agent) free of stamp duty and stamp duty reserve tax depends on the
settlement relating only to a subscription by it and/or such person
direct from the Company for the Placing Shares in question. Such
agreement assumes that the Placing Shares are not being subscribed
for 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 relates to any other
subsequent dealing in the Placing Shares, stamp duty or stamp duty
reserve tax may be payable, for which neither the Company nor
Panmure Gordon will be responsible, and the Placee to whom (or on
behalf of whom, or in respect of the person for whom it is
participating in the Placing as an agent or nominee) the
allocation, issue or delivery of Placing Shares has given rise to
such UK stamp duty or stamp duty reserve tax undertakes to pay such
UK stamp duty or stamp duty reserve tax forthwith and to indemnify
on an after-tax basis and to hold harmless the Company and Panmure
Gordon in the event that any of the Company and/or Panmure Gordon
has incurred any such liability to UK stamp duty or stamp duty
reserve tax. If this is the case, each Placee should seek its own
advice and notify Panmure Gordon accordingly.
In addition, Placees should note that they will be liable for
any stamp duty and all other stamp, issue, securities, transfer,
registration, documentary or other duties or taxes (including any
interest, fines or penalties relating thereto) payable outside the
UK by them or any other person on the subscription by them of any
Placing Shares or the agreement by them to subscribe for any
Placing Shares.
Each Placee, and any person acting on behalf of the Placee,
acknowledges that Panmure Gordon does not owe any fiduciary or
other duties to any Placee in respect of any representations,
warranties, undertakings or indemnities in the Placing
Agreement.
Each Placee and any person acting on behalf of such Placee
acknowledges and agrees that Panmure Gordon or any of its
affiliates may, at their absolute discretion, agree to become a
Placee in respect of some or all of the Placing Shares.
When a Placee or person acting on behalf of such Placee is
dealing with Panmure Gordon, any money held in an account with
Panmure Gordon on behalf of such Placee and/or any person acting on
behalf of such Placee will not be treated as client money within
the meaning of the rules and regulations of the FCA made under the
FSMA. Each Placee acknowledges that the money will not be subject
to the protections conferred by the client money rules; as a
consequence, this money will not be segregated from Panmure
Gordon's money in accordance with the client money rules and will
be used by Panmure Gordon in the course of its own business and
such Placee will rank only as a general creditor of Panmure
Gordon.
All times and dates in this Announcement (including this
Appendix) may be subject to amendment, and Placees' commitments,
representations and warranties are not conditional on any of the
expected times and dates in this Announcement (including this
Appendix) being achieved. Panmure Gordon shall notify the Placees
and any person acting on behalf of the Placees of any changes.
Past performance is no guide to future performance and persons
needing advice should consult an appropriately qualified
independent financial adviser.
Panmure Gordon is entitled, at its discretion and out of its own
resources, at any time to rebate to some or all of its investors,
or to other parties, part or all of its fees relating to the
Placing.
MISCELLANEOUS
Solely for the purposes of the product governance requirements
contained within the FCA Handbook Product Intervention and Product
Governance Sourcebook (the "UK Product Governance Rules"), and
disclaiming all and any liability, whether arising in tort,
contract or otherwise, which any "manufacturer" (for the purposes
of the UK Product Governance Rules) may otherwise have with respect
thereto, the Ordinary Shares have been subject to a product
approval process, which has determined that the Ordinary Shares
are: (i) compatible with an end target market of investors who meet
the criteria of professional clients and eligible counterparties
each as defined in the FCA Handbook Conduct of Business Sourcebook
("COBS"); and (ii) eligible for distribution through all
distribution channels as are permitted by the UK Product Governance
Rules (the "UK Target Market Assessment").
Solely for the purposes of the product governance requirements
contained within: (a) EU Directive 2014/65/EU on markets in
financial instruments, as amended ("MiFID II"); (b) Articles 9 and
10 of Commission Delegated Directive (EU) 2017/593 supplementing
MiFID II; and (c) local implementing measures (together, the
"Product Governance Requirements"), and disclaiming all and any
liability, whether arising in tort, contract or otherwise, which
any "manufacturer" (for the purposes of the Product Governance
Requirements) may otherwise have with respect thereto, the Placing
Shares have been subject to a product approval process, which has
determined that the Placing Shares are: (i) compatible with an end
target market of retail investors and investors who meet the
criteria of professional clients and eligible counterparties, each
as defined in MiFID II; and (ii) eligible for distribution through
all distribution channels as are permitted by MiFID II (the "EU
Target Market Assessment").
Notwithstanding the UK Target Market Assessment and the EU
Target Market Assessment, distributors should note that: the price
of the Placing Shares may decline and investors could lose all or
part of their investment; the Placing Shares offer no guaranteed
income and no capital protection; and an investment in the Placing
Shares is compatible only with investors who do not need a
guaranteed income or capital protection, who (either alone or in
conjunction with an appropriate financial or other adviser) are
capable of evaluating the merits and risks of such an investment
and who have sufficient resources to be able to bear any losses
that may result therefrom. Each of the UK Target Market Assessment
and the EU Target Market Assessment is without prejudice to the
requirements of any contractual, legal or regulatory selling
restrictions in relation to the Placing. Furthermore, it is noted
that, notwithstanding the UK Target Market Assessment and the EU
Target Market Assessment, Panmure Gordon will only procure
investors who meet the criteria of professional clients and
eligible counterparties, as defined under COBS or MiFID II, as
applicable. For the avoidance of doubt, neither the UK Target
Market Assessment nor the EU Target Market Assessment constitutes:
(a) an assessment of suitability or appropriateness for the
purposes of MiFID II; or (b) a recommendation to any investor or
group of investors to invest in, or purchase, or take any other
action whatsoever with respect to the Placing Shares.
Each distributor is responsible for undertaking its own target
market assessment in respect of the Placing Shares and determining
appropriate distribution channels.
The content of this Announcement has been prepared by, and is
the sole responsibility of, Arecor Therapeutics plc.
The information contained in this Announcement is given at the
date of its publication (unless otherwise marked) and is subject to
updating, revision and amendment from time to time. Neither the
content of the Company's website nor any website accessible by
hyperlinks to the Company's website is incorporated in, or forms
part of, this Announcement .
Certain statements in this Announcement are forward-looking
statements which are based on the Company's expectations,
intentions and projections regarding its future performance,
anticipated events or trends and other matters that are not
historical facts. These forward-looking statements, which may use
words such as "aim", "anticipate", "believe", "could", "intend",
"estimate", "expect" and words of similar meaning, include all
matters that are not historical facts. These forward-looking
statements involve risks, assumptions and uncertainties that could
cause the actual results of operations, financial condition,
liquidity and dividend policy and the development of the industries
in which the Company's businesses operate to differ materially from
the impression created by the forward-looking statements. These
statements are not guarantees of future performance and are subject
to known and unknown risks, uncertainties and other factors that
could cause actual results to differ materially from those
expressed or implied by such forward-looking statements. Given
those risks and uncertainties, prospective investors are cautioned
not to place undue reliance on forward-looking statements.
Forward-looking statements speak only as of the date of such
statements and, except as required by the FCA, the London Stock
Exchange or applicable law, the Company undertakes no obligation to
update or revise publicly any forward-looking statements, whether
as a result of new information, future events or otherwise.
Panmure Gordon (UK) Limited ("Panmure Gordon"), which is
authorised and regulated in the United Kingdom by the FCA, is
acting as nominated adviser and sole bookrunner to the Company in
connection with the Placing and Admission and to no-one else and
will not be responsible to anyone other than the Company for
providing the protections afforded to its clients, nor for
providing advice in relation to the Placing or Admission or any
other matter referred to in this Announcement. Panmure Gordon's
responsibilities as the Company's nominated adviser under the AIM
Rules for Nominated Advisers are owed solely to London Stock
Exchange plc and are not owed to the Company or to any director of
the Company or to any other person in respect of any decision to
acquire shares in the Company in reliance on any part of this
Announcement .
None of Panmure Gordon, or any of its directors, officers,
employees, advisers, affiliates or agents, accepts any
responsibility or liability whatsoever for or makes any
representation or warranty, express or implied, as to this
Announcement , including the truth, accuracy or completeness of the
information in this Announcement (or whether any information has
been omitted from the Announcement ) or for any loss howsoever
arising from any use of the Announcement or its contents. Panmure
Gordon and its directors, officers, employees, advisers, affiliates
or agents, accordingly disclaim all and any liability whether
arising in tort, contract or otherwise which they might otherwise
have in respect of this Announcement or its contents or otherwise
arising in connection therewith.
Data Protection
The processing of a Placee's personal data by the Company will
be carried out in compliance with the applicable data protection
legislation and with its Privacy Notice, a copy of which can be
found on the Company's website https://arecor.com/
Each Placee acknowledges that it has read and understood the
processing activities carried out by the Company as informed in the
referred Privacy Notice.
APPIX III
DEFINITIONS
The following definitions apply throughout the Announcement,
unless the context requires otherwise:
"Acquisition" the acquisition by the Company of the
entire issued share capital of Tetris
Pharma in accordance with the terms
of the SPA
"Admission" EIS/VCT Admission in the case of the
EIS/VCT Placing Shares and General
Admission in the case of the General
Placing Shares and the Initial Consideration
Shares
"AIM" AIM, the market of that name operated
by London Stock Exchange
"AIM Rules" the AIM Rules for Companies as published
by the London Stock Exchange from time
to time
"Announcement" this announcement, together with the
Appendices contained herein
"Board" the board of directors of the Company
"Bookbuild" the process by which the Placing will
effectuated, which will be launched
immediately following this Announcement
in accordance with the terms and conditions
set out in Appendix II
"certificated" or "in in relation to a share or other security,
certificated form" not in uncertificated form (that is,
not in CREST)
"Company" or "Arecor" Arecor Therapeutics plc, a public limited
company incorporated in England and
Wales with registered number 13331147
"Completion" completion of the Acquisition
"CREST" the relevant system (as defined in
the CREST Regulations) in respect of
which Euroclear is the operator (as
defined in the CREST Regulations),
which facilitates the transfer of title
to shares in uncertificated form
"CREST Regulations" the Uncertificated Securities Regulations
2001 (SI 2001/3755) (as amended)
"Directors" the directors of the Company
"Deferred Consideration the potential new Ordinary Shares to
Shares" be issued pursuant to the Earn Out,
such shares to be issued at no less
than the higher of GBP4.05 per Ordinary
Shares and 30-day volume weighted average
share price of Arecor on the 30 business
days prior to the Earn Out determination
date
"Earn Out" or "Earn Out the deferred consideration of up to
Payment" GBP4.0 million to be paid to the Tetris
Pharma Sellers subject to the achievement
of performance conditions on each of
the first, second and third anniversary
of Completion and to be satisfied through
the issue of either (i) Deferred Consideration
Shares or (ii) unsecured loan notes
having an aggregate principal value
equal to the amount of the relevant
payment, at the Company's election
"EEA" European Economic Area
"EIS" Enterprise Investment Scheme
"EIS/VCT Admission" admission of the EIS/VCT Placing Shares
to trading on AIM becoming effective
in accordance with the AIM Rules
"EIS/VCT Placing" the conditional placing of EIS/VCT
Placing Shares with Placees at the
Placing Price pursuant to the Placing
Agreement
"EIS/VCT Placing Shares" the EIS Shares and the VCT Shares together
"EIS Relief" the relief claimed by any holder of
the EIS Shares under Part 5 of the
ITA 2007 or exemption or relief available
under sections 150A, 150C and Schedule
"EIS Shares" 5B Taxation of Chargeable Gains Act
1992
the Placing Shares to be allotted and
issued by the Company at the Placing
Price, conditional on EIS/VCT Admission,
in connection with the EIS/VCT Placing,
which are intended to qualify for EIS
Relief
"Enlarged Share Capital" the entire issued share capital of
the Company as enlarged by the issue
of the Placing Shares and Initial Consideration
Shares following Admission
"EU" European Union
"Euroclear" Euroclear UK & Ireland Limited
"Existing Ordinary Shares" the 27,835,024 Ordinary Shares in issue
on the date of this Announcement
"FCA" the Financial Conduct Authority
"FSMA" Financial Services and Market Act 2000
"General Admission" (as amended)
admission of the General Placing Shares
and the Initial Consideration Shares
to trading on AIM becoming effective
in accordance with the AIM Rules
"General Placing" the conditional placing of the General
Placing Shares with Placees at the
Placing Price pursuant to the Placing
Agreement
"General Placing Shares" the Placing Shares to be allotted and
issued by the Company at the Placing
Price, conditional on General Admission,
in connection with the General Placing
(excluding the EIS/VCT Placing Shares)
"Group" the Company and its subsidiaries
"Initial Consideration the 651,726 new Ordinary Shares to
Shares" be issued by the Company to the Tetris
Pharma Sellers pursuant to the SPA
"Inventory Payment" the payment of $1,217,388 to be made
by Tetris Pharma to Xeris in relation
to the initial Ogluo (R) inventory
held by Tetris Pharma, payable in accordance
with the Xeris Licence Amendment
"ISIN" International Securities Identification
Number
"ITA 2007" Income Tax Act 2007
"London Stock Exchange" London Stock Exchange plc
"Long Stop Date" 15 August 2022
"Ordinary Shares" ordinary shares of GBP0.01 each in
the capital of the Company
"Panmure Gordon" Panmure Gordon (UK) Limited
"Placing Agreement" the agreement dated 1 August 2022 between
the Company and Panmure Gordon in respect
"Placees" of the Placing
the persons who have agreed to subscribe
for Placing Shares under the Placing
"Placing" the conditional placing by the Company
of the Placing Shares with the Placees,
otherwise than on a pre-emptive basis,
at the Placing Price pursuant to the
Placing Agreement and comprising the
EIS/VCT Placing and the General Placing
"Placing Price" 300 pence per Placing Share
"Placing Shares" the new Ordinary Shares which are the
subject of the Placing and comprising
of the EIS/VCT Placing Shares and the
General Placing Shares
"Registrar" Computershare Investor Services plc
of The Pavilions, Bridgwater Road,
Bristol BS13 8AE
"Regulatory Information has the meaning given in the AIM Rules
Service"
"Restricted Jurisdiction" the US, Australia, Canada, Japan, New
Zealand and the Republic of South Africa
"Securities Act" US Securities Act of 1933 (as amended)
"Shareholders" the holders of Existing Ordinary Shares
"SPA" The share sale and purchase agreement
dated 1 August 2022 and entered into
between (1) the Company and (2) the
Tetris Pharma Sellers in connection
with the Acquisition
"stock account" an account within a member account
in CREST to which a holding of a particular
share or other security in CREST is
credited
"Tetris Pharma" Tetris Pharma Ltd, a private limited
company incorporated in England and
Wales with registered number 12548259
"Tetris Pharma Payments" the payments to be made by Tetris Pharma
in respect of amounts owed by Tetris
Pharma to third parties at completion
of the Acquisition
"Tetris Pharma Sellers" the holders of the entire issued share
capital of Tetris Pharma
"uncertificated" or "in in relation to a share or other security,
uncertificated form" recorded on the relevant register as
being held in uncertificated form in
CREST and title to which, by virtue
of the CREST Regulations, may be transferred
through CREST
"United Kingdom" or "UK" the United Kingdom of Great Britain
and Northern Ireland
"United States", "United the United States of America, its territories
States of America" or and possessions, any state of the United
"US" States of America and the District
of Columbia and all areas subject to
its jurisdiction
"VCT" Venture Capital Trust as defined by
section 259 ITA 2007
"VCT Relief" the relief claimed by any holder of
the VCT Shares under Part 6 of the
ITA 2007 or exemption or relief available
under sections 151A, 151B and Schedule
5C Taxation of Chargeable Gains Act
1992 or Chapter 5 of Part 6 of the
Income Tax (Trading and Other Income)
Act 2005
"VCT Shares" the Placing Shares to be allotted and
issued by the Company at the Placing
Price, conditional on EIS/VCT Admission,
in connection with the EIS/VCT Placing
which are intended to qualify for VCT
Relief
"Xeris" Xeris Pharmaceuticals, Inc.
"Xeris Licence Amendment" the amendment number 2 agreement dated
15 July 2022 and entered into between
(1) Xeris, (2) Strongbridge Dublin
Limited and (3) Tetris Pharma amending
the licence agreement entered into
between them dated 14 July 2021 (as
amended by amendment number 1 on 18
January 2022)
This information is provided by RNS, the news service of the
London Stock Exchange. RNS is approved by the Financial Conduct
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Kingdom. Terms and conditions relating to the use and distribution
of this information may apply. For further information, please
contact rns@lseg.com or visit www.rns.com.
RNS may use your IP address to confirm compliance with the terms
and conditions, to analyse how you engage with the information
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use the personal data you provide us, please see our Privacy
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END
ACQUASVRUVUWRRR
(END) Dow Jones Newswires
August 01, 2022 02:00 ET (06:00 GMT)
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