TIDMUBI
RNS Number : 8859T
Ubisense Group PLC
18 October 2017
THIS ANNOUNCEMENT, INCLUDING THIS APPIX (TOGETHER, THE
"ANNOUNCEMENT") AND THE INFORMATION IN IT, IS RESTRICTED, AND IS
NOT FOR PUBLICATION, RELEASE OR DISTRIBUTION, DIRECTLY OR
INDIRECTLY, IN WHOLE OR IN PART, IN OR INTO THE UNITED STATES,
CANADA, AUSTRALIA, NEW ZEALAND, JAPAN OR THE REPUBLIC OF SOUTH
AFRICA OR ANY OTHER JURISDICTION IN WHICH SUCH PUBLICATION OR
DISTRIBUTION WOULD BE UNLAWFUL
CERTAIN INFORMATION IN THIS ANNOUNCEMENT WOULD HAVE CONSTITUTED
INSIDE INFORMATION (AS DEFINED BY ARTICLE 7 OF REGULATION (EU) NO
596/2014) PRIOR TO ITS RELEASE AS PART OF THIS ANNOUNCEMENT
Ubisense Group plc
GBP5.5 million placing
Ubisense Group plc (AIM: UBI) ("Ubisense" or the "Company"), a
global leader in Enterprise Location Intelligence solutions, is
pleased to announce it has raised GBP5.5 million (before expenses)
from a placing (the "Placing") in order to support growth plans and
strengthen its balance sheet.
Highlights
-- Placing of 17,187,500 new ordinary shares (the "Placing
Shares") at a price of 32 pence per Placing Share raising gross
proceeds of GBP5.5 million.
-- The Placing Shares represent approximately 23.5% per cent. of
the enlarged share capital of the Company.
-- Net proceeds will be used to support growth plans and
strengthen the financial position of the Company (further details
are set out in the "Use of Proceeds" section below).
-- Certain of the Directors and Kestrel Partners LLP (which has
a representative on the Board), intend to subscribe for an
aggregate of 6,081,250 Placing Shares for a total consideration of
GBP1,946,000.
-- The Placing is conditional upon the passing of certain
resolutions. A circular (the "Circular") is expected to be posted
today notifying shareholders of a general meeting which is being
convened for the purpose of considering the relevant resolutions,
at the registered office of the Company at St. Andrew's House, 90
St. Andrew's Road, Chesterton, Cambridge, Cambridgeshire CB4 1DL on
3 November 2017 at 10.00 am.
-- Numis Securities Limited ("Numis"), the Company's nominated
adviser and broker, is acting as sole bookrunner in relation to the
Placing.
-- Appendix 2 to this Announcement contains the detailed terms
and conditions applicable to the Placing and a copy of this
Announcement is also available on the Company's website
(www.ubisense.net).
For further information, please contact:
Ubisense Group plc +44 (0)1223 535170
Richard Petti
Tim Gingell
Numis Securities Limited +44 (0)20 7260 1000
Jamie Lillywhite (Corporate Finance)
Toby Adcock (Corporate Broking)
Redleaf Communications +44 (0)20 7382 4730
David Ison
Elisabeth Cowell
Current trading overview
In its 2016 full year results, Ubisense set out a clear
software-focused strategy designed to drive sales and improve
margins across its two product lines: myWorld and RTLS
SmartSpace.
Over the course of 2017, the Group has made significant progress
implementing its strategy by:
- Focusing on developing scalable software offerings which
leverage IIoT (industrial internet of things) technology to deliver
strong customer Return on Investment "RoI"
- Targeting a more focused addressable market consisting of
leading global manufacturers and utility companies in North
America, Europe and Asia
- Increased focus on selling products relating to the Group's
own IP leading to improved gross margins
- Strengthening its organization within both divisions with new key appointments
Following these changes, the Company reported a strong set of
financial results for the six months ended 30 June 2017, delivering
a revenue increase of 16% on the prior period, within which revenue
generated by the Group's own products increased by 58%.
In addition, the Company has recently announced three
significant new contract wins, each worth over GBP1m in
revenue:
- a new myWorld contract with a telecoms customer in June
- a major strategic sale of its RTLS SmartSpace software
platform with a North American aerospace and defence contractor in
July
- an order for substantial expansion to one of the largest RTLS
SmartSpace installations in Europe was received in September
as well as securing business in new markets such as Turkey and
Thailand.
Reasons for the Placing
The Directors believe that the dynamics of the Group's two key
market verticals are strong, positioning Ubisense to capitalize on
significant projected increases in spending relating to two
themes:
- Industry 4.0, under which $0.9 trillion is forecast to be
invested in smart production technology over the next five
years
- global fibre-to-the-home (FTTH) investments, which present
significant operational challenges to telecommunications
operators.
These strong dynamics are evident in the Group's recent contract
wins.
As such, the Directors anticipate further wins in both its
platforms to continue to deliver growth of revenues relating to its
own products, with a continued increase in the pipeline of
enterprise software transactions at higher margins.
As previously announced, the Company expects to see a run-off of
historic contracted maintenance and development services related to
third party Geospatial products over the next 12-18 months. Whilst
this will provide a headwind to revenues, gross margins are
expected to improve as its enterprise software sales continue to
grow.
The Directors believe that in order to capitalize on its market
success, and as the Company moves away from third party services
revenue, the Company should invest in its sales and pre-sales
capacity to drive growth in revenues and margin from its own
products. In addition, it also intends to invest in both its
software and hardware products to maintain market
competitiveness.
Impact of the Placing on the Company's bank facilities
Currently the Company's ability to invest is curtailed by an
operating cash flow covenant in its existing bank facilities. As
well as providing cash to invest in future growth, the net proceeds
of the Placing will strengthen the Company's balance sheet.
This anticipated balance sheet strengthening has allowed the
Company to negotiate with its lending bank, with which it has
agreed in principle to secure an improved covenant conditional on
completion of the proposed placing and certain re-phasing of the
loan amortization payments. The revised covenant and the net
proceeds are expected to give the Company further flexibility to
drive its growth strategy.
Use of the Proceeds from the Placing
The Company intends to raise gross proceeds of GBP5.5 million
pursuant to the Placing, equivalent to approximately GBP5.15
million net of expenses, which is intended to be used as
follows:
- GBP1.5 million to invest in the Company's go-to-market
capacity by recruiting significantly more quota-carrying sales and
pre-sales personnel, and to invest in targeted marketing capacity
;
- GBP0.5 million to invest in product development to recruit
additional software developers to accelerate product
modularization, documentation and to improve the channel readiness
of its products;
- GBP0.5 million to re-engineer its RTLS hardware, re-designing
it in order to target a unit cost reduction to maintain market
competitiveness;
- the balance being used to strengthen the Company's balance sheet.
Details of the Placing and the Placing Agreement
The Placing
The Placing Shares will represent approximately 23.5 per cent.
of the Enlarged Share Capital following Admission assuming there is
no exercise of any options.
It is expected that Placing Shares to be held in uncertificated
form will be delivered in CREST on 6 November 2017 and that share
certificates for Placing Shares to be held in certificated form
will be despatched by first class post by as soon as practicable
after 6 November 2017.
Application will be made to the London Stock Exchange for the
Placing Shares to be admitted to trading on AIM and it is
anticipated that trading in the Placing Shares will commence on AIM
at 8.00 am on 6 November 2017.
The Placing Shares will, when issued and fully paid, rank in
full for any dividend or other distribution declared, made or paid
after Admission and otherwise equally in all respects with the
Existing Ordinary Shares.
The Placing is conditional, amongst other things, upon:
(i) the Resolutions to be proposed at the General Meeting being passed without amendment;
(ii) the Placing Agreement becoming unconditional in all
respects (save for Admission) and it not having been terminated;
and
(iii) admission of the Placing Shares to trading on AIM becoming
effective by not later than 8:00 am on 6 November 2017 (or such
later time and date as the Company and Numis may agree, not being
later than 8:30 am on 27 November 2017).
Participation of the Directors and other related parties
Certain of the Directors and Kestrel Partners LLP (which has a
representative on the Board), have, conditional on Admission,
participated in the Placing by subscribing for an aggregate of
6,081,250 Placing Shares as set out below:
Number Number of Percentage
of Placing Ordinary Shares of enlarged
Shares to be held share capital
on admission
Robert Sansom 1,250,000 6,235,899 8.5%
Peter Harverson 78,125 223,286 0.3%
Paul Taylor 78,125 191,459 0.3%
Richard Petti 78,125 78,125 0.1%
Tim Gingell 46,875 86,875 0.1%
Kestrel Partners
LLP (Oliver Scott) 4,550,000 20,645,493 28.3%
Kestrel Partners LLP is a related party (as defined by the AIM
Rules for Companies) of the Company by virtue of its status as a
substantial shareholder in the Company and also due to Oliver
Scott, a Non-Executive Director of the Company, being a partner of,
and holding a beneficial interest in, Kestrel.
In addition, Columbia Threadneedle Investments ("Columbia
Threadneedle") has agreed to subscribe for 3,000,000 Placing Shares
pursuant to the Placing. Columbia Threadneedle is a related party
of the Company by virtue of its status as a substantial shareholder
in the Company.
The subscriptions by Robert Sansom, Peter Harverson, Paul
Taylor, Richard Petti, Tim Gingell, Kestrel and Columbia
Threadneedle are all related party transactions under the AIM Rules
for Companies.
Taking into account the related party transactions noted above,
the independent director, being Ian Kershaw, confirms that he
considers, having consulted with the Company's nominated adviser,
Numis, the terms of the Placing are fair and reasonable insofar as
the Company's shareholders are concerned.
The Placing Agreement
Pursuant to the terms of the Placing Agreement, Numis as agent
for the Company, has agreed conditionally to use its reasonable
endeavours to procure Placees for the Placing Shares at the Placing
Price.
The Placing Agreement contains warranties from the Company in
favour of Numis in relation to, amongst other things, the accuracy
of the information contained in the documents relating to the
Placing and certain other matters relating to the Group and its
business. In addition, the Company has agreed to indemnify Numis in
relation to certain liabilities that it may incur in respect of the
Placing.
The obligations of Numis under the Placing Agreement in respect
of the Placing are conditional upon, amongst other things, (i)
Admission becoming effective on or before 8.00 a.m. on 6 November
2017 (or such later date as the Company and Numis may agree, but
not later than 8:30 am on 27 November 2017), (ii) there being prior
to Admission no material breach of the warranties given to Numis,
and (iii) Shareholders passing the Resolutions at the General
Meeting.
Numis may terminate the Placing Agreement in specified
circumstances (including for breach of warranty at any time prior
to Admission, if such breach is reasonably considered by Numis to
be material in the context of the Placing) and in the event of a
force majeure event occurring at any time prior to Admission. If
the conditions of the Placing Agreement which apply to the Placing
as a whole are not fulfilled on or before the relevant date in the
Placing Agreement, subscription monies will be returned to Placees
without interest as soon as possible thereafter.
In consideration for the services to be provided to the Company
by Numis in connection with Admission and the Placing, the Company
has agreed to pay Numis certain fees and commissions and certain
other costs and expenses incidental to Admission and/or the
Placing.
Importance of the Shareholder Vote
As described in further detail above, the Directors believe that
the Group has compelling investment opportunities to expand its
go-to-market capabilities and develop its products. Its ability to
invest in future growth is currently significantly curtailed by its
bank covenants, which are based on maintaining a minimum level of
operating cash flow and which follow a profile of continued
tightening in future years. The Company has agreed in principle
with its lending bank, conditional on completion of the Placing and
certain re-phasing of the loan amortization payments, to loosen the
current and future covenant which, together with the net proceeds
of the Placing, will allow the Company to invest as further
described above.
The Directors believe that the Company has sufficient liquidity
for its present requirements. However, if the Resolutions are not
passed and the Placing does not proceed the Directors will pursue
alternative sources of funding to support the Company's strategy.
Whilst the Company has received indicative offers, including an
advanced proposal cornerstoned by its major shareholder Kestrel,
subject to bank and shareholder approval, there can be no guarantee
that such additional sources of financing would be secured. If no
additional funding were to be secured, the Directors believe the
Group's growth prospects would be reduced and there would be an
increased risk that it would breach its banking covenants.
Recommendation
The Directors believe that completion of the Placing and the
approval of the Resolutions are in the best interests of the
Company and Shareholders as a whole. Accordingly, the Directors
unanimously recommend that you vote in favour of the Resolutions at
the General Meeting, as they intend to do in respect of their own
beneficial holdings and non-beneficial holdings of Ordinary Shares
amounting to, in aggregate, 21,379,887 Ordinary Shares,
representing approximately 38.3 per cent. of the Existing Ordinary
Shares.
Expected timetable of principal events
Posting of the Circular 18 October 2017
Latest time and date for receipt 10.00 am on 1
of Forms of Proxy November 2017
General Meeting 10.00 am on 3
November 2017
Expected date for Admission and 8:00 am on 6 November
commencement of dealings in the 2017
Placing Shares on AIM
Expected date for CREST accounts 8:00 am on 6 November
to be credited in respect of 2017
the Placing Shares to be held
in uncertificated form
Expected date for the despatch as soon as practicable
of definitive certificates in after 6 November
respect of the Placing Shares 2017
to be held in certificated form
IMPORTANT NOTICE
No action has been taken by the Company, Numis 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
any jurisdiction where action for that purpose is required. Any
failure to comply with these restrictions may constitute a
violation of the securities laws of such jurisdictions. Persons
into whose possession this Announcement comes shall inform
themselves about, and observe such restrictions.
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.
THIS ANNOUNCEMENT, INCLUDING THE APPIX AND THE INFORMATION
CONTAINED HEREIN, IS FOR INFORMATION PURPOSES ONLY, IS NOT INTED TO
AND DOES NOT CONSTITUTE OR FORM PART OF ANY OFFER OR INVITATION TO
PURCHASE OR SUBSCRIBE FOR, UNDERWRITE, SELL OR ISSUE OR THE
SOLICITATION OF AN OFFER TO PURCHASE OR SUBSCRIBE, SELL, ACQUIRE,
DISPOSE OF THE PLACING SHARES OR ANY OTHER SECURITY IN THE UNITED
STATES, CANADA, AUSTRALIA, NEW ZEALAND, JAPAN OR THE REPUBLIC OF
SOUTH AFRICA OR IN ANY JURISDICTION IN WHICH, OR TO ANY PERSONS TO
WHOM, SUCH OFFERING, SOLICITATION OR SALE WOULD BE UNLAWFUL.
Numis Securities Limited is authorised and regulated in the
United Kingdom by the FCA and is acting exclusively for the Company
in connection with the Placing and no one else and will not be
responsible to anyone other than the Company for providing the
protections afforded to their clients nor for providing advice to
any other person in relation to the Placing and/or any other matter
referred to in this Announcement.
No representation or warranty, express or implied, is or will be
made as to, or in relation to, and no responsibility or liability
is or will be accepted by Numis or the Company or any of their
respective affiliates or any of their respective directors,
officers, employees, advisers or representatives (collectively,
"Representatives") as to or in relation to the accuracy or
completeness of this Announcement or any other written or oral
information made available to or publicly available to any
interested party or its advisers, and any liability therefor is
expressly disclaimed.
This Announcement does not identify or suggest, or purport to
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 Numis.
This Announcement contains certain forward-looking statements,
beliefs or opinions, with respect to certain of the Company's
current expectations and projections about future prospects,
developments, strategies, performance, anticipated events or trends
and other matters that are not historical facts. These
forward-looking statements, which sometimes use words such as
"aim", "anticipate", "believe", "intend", "plan", "estimate",
"expect" and words of similar meaning, include all matters that are
not historical facts and reflect the directors' beliefs and
expectations and involve a number of risks, uncertainties and
assumptions that could cause actual results and performance to
differ materially from any expected future results or performance
expressed or implied by the forward-looking statement. Statements
contained in this Announcement regarding past trends or activities
should not be taken as a representation that such trends or
activities will continue in the future. The information contained
in this Announcement is subject to change without notice and,
except as required by applicable law, neither the Company nor Numis
nor any of their respective affiliates nor any of their respective
Representatives assumes any responsibility or obligation to update,
amend or revise publicly or review any of the forward-looking
statements contained in this Announcement. You should not place
undue reliance on forward-looking statements, which speak only as
of the date of this Announcement. Any indication in this
Announcement of the price
at which Placing Shares have been bought or sold in the past
cannot be relied upon as a guide to future performance. No
statement in this Announcement is or is intended to be a profit
forecast or profit estimate or to imply that the earnings of the
Company for the current or future financial years will necessarily
match or exceed the historical or published earnings of the
Company. Past performance of the Company cannot be relied on as a
guide to future performance and persons reading this Announcement
are cautioned not to place undue reliance on such forward-looking
statements.
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 to be issued pursuant to the Placing will not
be admitted to trading on any stock exchange other than the AIM
Market operated by the London Stock Exchange.
Neither the content of the Company's website nor any website
accessible by hyperlinks on the Company's website is incorporated
in, or forms part of, this Announcement.
Appendix 1 - Risk Factors
RISK FACTORS
An investment in Ordinary Shares involves a high degree of risk.
Accordingly, prospective investors should carefully consider the
specific risks set out below in addition to all of the other
information set out in this document before investing in Ordinary
Shares.
The Directors believe the following risks to be among the most
significant risks for potential investors. However, the risks
listed do not necessarily comprise all those associated with an
investment in the Company and are not set out in any particular
order of priority. Additional risks and uncertainties not currently
known to the Directors or which the Directors currently deem
immaterial may also have an adverse effect on the Group and the
information set out below does not purport to be an exhaustive
summary of the risks affecting the Group. In particular, the
Company's performance may be affected by changes in market or
economic conditions and in legal, regulatory and tax
requirements.
If any of the following risks were to materialise, the Group's
business, financial condition, results or future operations could
be materially adversely affected. In such cases, the market price
of the Company's shares could decline and an investor may lose part
or all of his or her investment.
Technological and market risks
The Group operates in an industry where competitive advantage is
heavily dependent on technology. It is possible that technological
development may reduce the importance of the Group's function in
the market or render the patents on which it relies redundant. For
instance, the Group's enterprise location systems rely on
ultra-wideband radio signals to operate. There is no guarantee that
technological advances will not render systems based on
ultra-wideband radio obsolete.
The Group faces competitive and strategic risks that are
inherent in a rapidly growing emerging market. Its products are
complex and may contain undetected defects when first introduced
which could increase the Group's costs or reduce revenues. The
Group's success will depend on market acceptance of the Group's
products.
Staff recruitment and retention
The contribution made by Ubisense's highly skilled and
experienced staff is vital to the Group's success. Any inability to
recruit and/or retain staff to fill key management roles would
likely adversely impact the Group's future development and
financial performance.
Reliance on third parties, including manufacturers
The Group relies on certain key third party equipment
manufacturers in the completion of its products, and therefore does
not always have complete control over the supply of the equipment
and materials it requires to comply with its obligations under
customer contracts. To the extent that the Group cannot acquire
equipment or materials according to its plans and budgets, its
ability to complete its work for its customers within the timetable
laid down by the contract or at a profit may be impaired. If a
manufacturer is unable to deliver the products for any reason, the
Group may be required to purchase such equipment or materials from
another source at a higher price. The resulting additional costs
may be substantial and the Group may be in breach of its contracts
with customers, which may result in a financial loss on a
particular contract or a loss of business. In addition, any
resulting failure to fulfil contracts with customers and other
business partners may have an adverse effect on the Group's future
profitability and reputation.
Dependence on key customers
The Group has a concentrated customer base, many of which are
substantially larger enterprises than the Group. As such, the
purchasing power of the Group's customers is often significant,
which may impact the ability of the Group to negotiate terms which
are favourable to it in contracts. The Group is reliant on
significant projects with its key customers to deliver its
projected financial results. Changes to the timing and/or terms of
significant projects, to the investment decisions of key customers
or failure by the Group to retain key customers may have a
significant adverse effect on the Group's business and financial
results. The loss of a major customer would likely result in a
decrease in Group revenues, margins and profitability.
Contracts
Some of the Group's commercial contracts include terms where
revenues and/or invoicing are related to customer acceptance. Other
contracts contain terms whereby the timing of cash collections is
contingent on the customer re-selling the Group's products to end
users.
Any delay in a customer accepting the Group's products and/or
performance under the relevant contract or in reselling the Group's
products may lead to the Group not receiving the expected revenues
under the relevant contract either within the timeframes expected
by the Group or in full or at all, any of which may have an adverse
effect in the Group's business and financial results.
Certain of the Group's legacy contracts related to services on
third party products are anticipated to expire in the next 12 to 18
months and a material proportion are not expected to renew. Whilst
the Directors expect to control the Group's cost base to mitigate
the impact of this transition, it is possible that the cost
implications will have a more significant impact on the Group's
financial performance than the Directors currently anticipate.
Impact of IFRS15 Revenue from Contracts with Customers
IFRS 15 introduces a number of new concepts and requirements and
is applicable from 1 January 2018. The Company is continuing to
assess the impact of the first year adoption of IFRS 15.
The Company anticipates that some elements of revenue
recognition may be deferred as a result of the requirement to
identify when the customer has control over the deliverables
provided by the Group.
The Directors believe that the majority of sales orders will be
unaffected by the application of IFRS 15, however, significant
contracts which involve multiple performance obligations are being
reviewed in detail. These obligations may include a combination of
software, hardware, maintenance & support, and service
revenues. Accordingly, the significance of the impact of IFRS 15 is
dependent upon the timing of delivery for significant contracts
close to a financial reporting period end.
Additionally, IFRS 15 states that costs incurred in acquiring
and fulfilling a customer contract shall be deferred and recognised
as an expense over a period that is consistent with the transfer to
the customer of the goods or services. The Directors continue to
assess the appropriateness of deferring costs against specific
projects.
Competition
Current and potential competitors may have substantially greater
financial, technical and marketing resources than the Group and so
may be better able to compete in the Group's target market.
Growth management
Further expansion will be required in the future to capitalise
on the anticipated increase in demand for the Group's products and
to offset the anticipated decline in the Group's services revenue
related to third party products. The Group's future success will
depend, in part, on its ability to manage this anticipated
expansion.
Credit
The main credit risk of the Group is attributable to trade
receivables owed by customers. As the majority of the Group's
customers are very large, blue chip utilities, telecoms and
manufacturing companies, the risk of non-payment tends to be less
of a traditional credit nature and more related to customer
satisfaction.
Credit exposure by customer is reviewed regularly by the
executive management team and the main Board with provision made
for doubtful receivables when there are circumstances which, based
on experience, are evidence of a likely reduction in the
recoverability of the receivable.
International trade and foreign exchange
The Group is a multi-national Group with significant foreign and
export operations, creating revenues and costs denominated in major
currencies other than GBP. Volatility in exchange rates will mean
that there may be positive or negative impact on the financial
results of the Group. Additional risks exist with changes to
international trade (including the UK's referendum result regarding
membership of the European Union), which may impact trade tariffs,
currency volatility and customer investment plans.
Financial profile
A majority of the Group's revenue is derived from a small number
of large deals, the timing of which is not within the control of
the Group. Such a profile makes forecasting difficult and changes
against expectations have had and may continue to have a
significant impact on the Group's results, particularly given the
Group's significant level of operational gearing.
Bank covenants
The Group is required to meet certain financial criteria agreed
as covenants for its bank. The financial measures are regularly
reviewed against covenant requirements to ensure the Group's
obligations can be met. The Group has agreed in principle with its
lending bank to amend its operating cash flow covenant as follows:
2017 - from nil to GBP2 million negative; 2018 - from GBP1 million
positive to GBP2 million negative; 2019 - from GBP1 million
positive to GBP1 million negative. If the operating performance of
the Group is not sufficient to meet its current covenants, or
provided its lending bank formalizes the agreement in principle its
proposed amended covenants, the Group would be reliant on the
ongoing support of its lending bank.
Intellectual property
The Group has a number of trade marks registered, and is
pursuing further trade mark registrations, in the major territories
in which it operates. The Group also has a patent portfolio
comprising a number of patents filed in territories worldwide.
Should a third party successfully demonstrate priority over any of
these rights, it could inhibit the Group, or the Group's customers,
from selling products in certain territories.
Any failure to protect the Group's intellectual property may
result in another party copying or otherwise obtaining and using
its proprietary technology without authorisation. There may not be
adequate protection for the intellectual property in every country
in which the Group's products are made available and policing
unauthorised use of proprietary information is difficult and
expensive. Due to the Group's size and limited cash resources, it
may not be able to detect and prevent infringement of its
intellectual property.
The Group has received (and expects to continue to receive in
its normal course of business) communications from third parties
alleging breach and/or infringement of their intellectual property
rights. The Group's policy is to diligently investigate all
intellectual property rights allegations made against it by third
parties. These third parties range from non-practising entities,
whose sole focus is to generate income from licensing their
intellectual property rights, to corporations with competing and/or
adjacent trading activities, including a large, multinational
corporation. No such communications have been received for over
three years. The Directors, having taken expert advice, believe
that the allegations of infringement made in such communications
are unjustified. However, the timeframes under which third parties
can allege breach of their intellectual property rights are
potentially prolonged, and the Directors cannot exclude the
possibility that third party assertions which the Directors believe
to be unjustified require the Group to incur significant
expenditure to defend against such assertions, or ultimately that
such assertions may subsequently be upheld by the competent
authorities resulting in a material negative impact on the
Group.
In addition, some of the Group's patents are licensed from a
third party. The terms of that licence are on relatively standard
commercial terms and the licence is not due to expire until 2025.
However, there can be no guarantee that such third party will
adequately maintain such patents and therefore the protection and
benefit afforded to the Company by such patents cannot be
guaranteed.
The steps which the Group has taken to protect its intellectual
property may be inadequate to prevent the misappropriation of its
proprietary technology. Any misappropriation of the Group's
intellectual property could have an adverse impact on the Group's
business and its operating results. Furthermore, the Group may need
to take legal action to enforce its intellectual property, to
protect trade secrets or to determine the validity or scope of the
proprietary rights of others. Litigation relating to the Group's
intellectual property, whether instigated by the Group to protect
its rights or arising out of alleged infringement of third party
rights, may result in substantial costs and the diversion of
resources and management attention and there can be no guarantees
as to the outcome of any such litigation.
Digital infrastructure and cybersecurity
Breaches of the Group's digital security or of the security
related to the Group's products, through cyber attacks or
otherwise, or failure of the Group's digital infrastructure, could
seriously disrupt the Group's operations or those of its customers
and result in the loss or misuse of data or sensitive information,
legal or regulatory breaches and potentially legal liability. These
could result in significant costs or have reputational
consequences.
The Group continues to invest in assessing its product structure
and strategy, enhancing its site resilience and defences, improving
network monitoring and reviewing the incident response processes to
mitigate the impact of a security breach.
The risks noted above do not necessarily comprise all those
potentially faced by the Group and are not intended to be presented
in any assumed order of priority.
Although the Directors will seek to minimise the impact of the
Risk Factors, investment in the Company should only be made by
investors able to sustain a total loss of their investment.
Investors are strongly recommended to consult an investment adviser
authorised under the FSMA who specialises in investments of this
nature before making any decision to invest.
Appendix 2 - Terms and conditions of the placing
IMPORTANT INFORMATION FOR PLACEES ONLY REGARDING THE PLACING
THIS ANNOUNCEMENT, INCLUDING THIS APPIX (TOGETHER, THE
"ANNOUNCEMENT") AND THE INFORMATION IN IT, IS RESTRICTED, AND IS
NOT FOR PUBLICATION, RELEASE OR DISTRIBUTION, DIRECTLY OR
INDIRECTLY, IN WHOLE OR IN PART, IN OR INTO THE UNITED STATES,
CANADA, AUSTRALIA, NEW ZEALAND, JAPAN OR THE REPUBLIC OF SOUTH
AFRICA OR ANY OTHER JURISDICTION IN WHICH SUCH PUBLICATION OR
DISTRIBUTION WOULD BE UNLAWFUL.
IMPORTANT INFORMATION ON THE PLACING FOR INVITED PLACEES
ONLY.
MEMBERS OF THE PUBLIC ARE NOT ELIGIBLE TO TAKE PART IN THE
PLACING. THIS APPIX AND THE TERMS AND CONDITIONS SET OUT HEREIN ARE
FOR INFORMATION PURPOSES ONLY AND ARE DIRECTED ONLY AT: (A) PERSONS
IN MEMBER STATES OF THE EUROPEAN ECONOMIC AREA WHO ARE QUALIFIED
INVESTORS AS DEFINED IN SECTION 86(7) OF THE FINANCIAL SERVICES AND
MARKETS ACT 2000, AS AMED, ("QUALIFIED INVESTORS") BEING PERSONS
FALLING WITHIN THE MEANING OF ARTICLE 2(1)(E) OF THE EU PROSPECTUS
DIRECTIVE (WHICH MEANS DIRECTIVE 2003/71/EC AND INCLUDES ANY
RELEVANT IMPLEMENTING DIRECTIVE MEASURE IN ANY MEMBER STATE) (THE
"PROSPECTUS DIRECTIVE"); (B) IN THE UNITED KINGDOM, QUALIFIED
INVESTORS WHO ARE PERSONS WHO (I) FALL WITHIN ARTICLE 19(5) OF THE
FINANCIAL SERVICES AND MARKETS ACT 2000 (FINANCIAL PROMOTION) ORDER
2005, AS AMED (THE "ORDER"); (II) FALL WITHIN ARTICLE 49(2)(A) TO
(D) ("HIGH NET WORTH COMPANIES, UNINCORPORATED ASSOCIATIONS, ETC")
OF THE ORDER; OR (III) ARE PERSONS TO WHOM IT MAY OTHERWISE BE
LAWFULLY COMMUNICATED (ALL SUCH PERSONS TOGETHER BEING REFERRED TO
AS "RELEVANT PERSONS"). THIS 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 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 ANNOUNCEMENT, INCLUDING THIS APPIX, IS FOR INFORMATION
PURPOSES ONLY AND DOES NOT ITSELF CONSTITUTE AN OFFER FOR SALE OR
SUBSCRIPTION OF ANY SECURITIES IN THE COMPANY. THIS ANNOUNCEMENT
HAS BEEN ISSUED BY AND IS THE SOLE RESPONSIBILITY OF THE
COMPANY.
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. THE SECURITIES REFERRED TO HEREIN
HAVE NOT BEEN AND WILL NOT BE REGISTERED UNDER THE U.S. SECURITIES
ACT OF 1933, AS AMED (THE "SECURITIES ACT"), AND MAY NOT BE OFFERED
OR SOLD IN THE UNITED STATES, EXCEPT PURSUANT TO AN EXEMPTION FROM,
OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS
OF THE SECURITIES ACT. NEITHER THE UNITED STATES SECURITIES AND
EXCHANGE COMMISSION NOR ANY SECURITIES REGULATORY AUTHORITY OF ANY
STATE OR OTHER JURISDICTION OF THE UNITED STATES HAS APPROVED OR
DISAPPROVED OF AN INVESTMENT IN THE SECURITIES OR PASSED UPON
ORORSED THE MERITS OF THE PLACING OR THE ACCURACY OR ADEQUACY OF
THE CONTENTS OF THIS ANNOUNCEMENT. ANY REPRESENTATION TO THE
CONTRARY IS A CRIMINAL OFFENCE IN THE UNITED STATES. NO PUBLIC
OFFERING OF SECURITIES IS BEING MADE IN THE UNITED STATES. NO
MONEY, SECURITIES OR OTHER CONSIDERATION FROM ANY PERSON INSIDE THE
UNITED STATES IS BEING SOLICITED AND, IF SENT IN RESPONSE TO THE
INFORMATION CONTAINED IN THIS ANNOUNCEMENT, WILL NOT BE
ACCEPTED.
EACH PLACEE SHOULD CONSULT WITH ITS OWN ADVISERS AS TO LEGAL,
TAX, BUSINESS AND RELATED ASPECTS OF AN INVESTMENT IN PLACING
SHARES. THE PRICE OF 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 SHARES.
Persons who are invited to and who choose to participate in the
Placing, by making (or on whose behalf there is made) an oral or
written offer to subscribe for Placing Shares (the "Placees"), will
be deemed to have read and understood this Announcement, including
this Appendix, in its 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 (as defined above) 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 3(2) of the
Prospectus Directive, (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 European Economic Area ("EEA") which has implemented the
Prospectus Directive other than Qualified Investors or in
circumstances in which the prior consent of Numis 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
other than Qualified Investors, the offer of those Placing Shares
to it is not treated under the Prospectus Directive as having been
made to such persons; and/or
3. (a) (i) it is not in the United States and (ii) it is not
acting for the account or benefit of a person in the United States,
(b) it is a dealer or other professional fiduciary in the United
States acting on a discretionary basis for a non-US person (other
than an estate or trust) in reliance on Regulation S under the
Securities Act; or (c) it is otherwise acquiring the Placing Shares
in an "offshore transaction" meeting the requirements of Regulation
S under the Securities Act.
The Company and Numis will rely upon the truth and accuracy of
the foregoing representations, acknowledgements and agreements.
This Announcement 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 and the information contained herein is
not for publication or distribution, directly or indirectly, to
persons in the United States, Canada, Australia, New Zealand, Japan
or the Republic of South Africa or in any jurisdiction in which
such publication or distribution is unlawful. Persons into whose
possession this Announcement may come 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 is being made in the United Kingdom, the United States or
elsewhere.
In particular, the Placing Shares referred to in this
Announcement have not been and will not be registered under the
Securities Act or 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, pledged or otherwise transferred
within the United States except pursuant to an exemption from, or
in a transaction not subject to, the registration requirements of
the Securities Act and the securities laws of any state or other
jurisdiction of the United States. The Placing Shares are being
offered and sold outside the United States in accordance with
Regulation S under the Securities Act.
The Placing Shares have not been approved or disapproved by the
US Securities and Exchange Commission, any state securities
commission or other regulatory authority in the United States, nor
have any of the foregoing authorities passed upon or endorsed the
merits of the Placing or the accuracy or adequacy of this
Announcement. Any representation to the contrary is a criminal
offence in the United States.
The relevant clearances have not been, nor will they be,
obtained from the securities commission of any province or
territory of Canada; no prospectus has been lodged with or
registered by the Australian Securities and Investments Commission
or the Japanese Ministry of Finance; 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 Canada, Australia, New Zealand, Japan or the Republic
of South Africa. Accordingly, the Placing Shares may not (unless an
exemption under the relevant securities laws is applicable) be
offered, sold, resold or delivered, directly or indirectly, in or
into Canada, Australia, New Zealand, Japan or the Republic of South
Africa or any other jurisdiction outside the United Kingdom.
Persons (including, without limitation, nominees and trustees)
who have a contractual 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.
In this Appendix, unless the context otherwise requires,
"Placee" means a Relevant Person (including individuals, funds or
otherwise) by whom or on whose behalf a commitment to subscribe for
Placing Shares has been given.
Details of the Placing
Numis has entered into the Placing Agreement with the Company
under which Numis has, on the terms and subject to the conditions
set out therein, undertaken to use its reasonable endeavours to
procure, as agent for the Company, subscribers for the Placing
Shares at the Placing Price.
The Placing Agreement contains customary warranties given by the
Company to Numis as to matters relating to the Company and its
business and a customary indemnity given by the Company to Numis in
respect of liabilities arising out of or in connection with the
Placing. The Placing is conditional upon, amongst other things, the
Resolutions being passed by the requisite majorities.
A circular explaining the background to and reasons for the
Placing, and containing the Notice of General Meeting will be sent
to shareholders. A copy of the Circular and the Notice of General
Meeting will also be available from the Company's website at:
www.ubisense.net.
The Placing is also conditional upon Admission becoming
effective and the Placing Agreement not being terminated in
accordance with its terms.
The Placing Shares will, when issued, be credited as fully paid
and will rank pari passu in all respects with the existing issued
Ordinary Shares, including the right to receive all dividends and
other distributions (if any) declared, made or paid on or in
respect of the Ordinary Shares after the date of issue of the
Placing Shares.
The Company, subject to certain exceptions, has agreed not to
allot, issue or grant any rights in respect of its Ordinary Shares
in the period of 120 days from the date of Admission without the
prior written consent of Numis (such consent not to be unreasonably
withheld or delayed).
Application for admission to trading
Application will be made to the London Stock Exchange for
Admission. Subject to, amongst other things, the Resolutions being
passed by the requisite majorities at the General Meeting, it is
expected that settlement of any such shares and Admission will
become effective on or around 6 November 2017 and that dealings in
the Placing Shares will commence at that time.
Participation in, and principal terms of, the Placing
1. Numis (whether through itself or any of 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.
2. Participation in the Placing will only be available to
persons who may lawfully be, and are, invited to participate by
Numis. Numis and its affiliates may participate in the Placing as
principal.
3. 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.
4. The Placing Price will be a fixed price of 32 pence per Placing Share.
5. An offer to acquire Placing Shares, which has been
communicated by a prospective Placee to Numis which has not been
withdrawn or revoked prior to publication of this Announcement,
shall not be capable of withdrawal or revocation immediately
following the publication of this Announcement without the consent
of Numis.
6. Each Placee's allocation will be confirmed to Placees orally
by Numis, and evidenced by a trade confirmation or contract note
will be despatched as soon as possible thereafter. The terms of
this Appendix will be deemed incorporated by reference therein. The
oral 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 Numis 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 Company's Articles of
Association.
7. Except as required by law or regulation, no press release or
other announcement will be made by Numis or the Company using the
name of any Placee (or its agent), in its capacity as Placee (or
agent), other than with such Placee's prior written consent.
8. Each Placee will have an immediate, separate, irrevocable and
binding obligation, owed to Numis, to pay in cleared funds
immediately on the settlement date, in accordance with the
registration and settlement requirements set out below, an amount
equal to the product of the Placing Price and the number of Placing
Shares such Placee has agreed to take up and the Company has agreed
to allot.
9. Irrespective of the time at which a Placee's allocation
pursuant to the Placing is confirmed, settlement for all Placing
Shares to be acquired pursuant to the Placing will be required to
be made at the same time, on the basis explained below under
"Registration and settlement".
10. All obligations under the Placing will be subject to
fulfilment or (where applicable) waiver of, amongst other things,
the conditions referred to below under "Conditions of the Placing"
and to the Placing not being terminated on the basis referred to
below under "Right to terminate under the Placing Agreement".
11. By participating in the Placing, each Placee will agree that
its rights and obligations in respect of the Placing will terminate
only in the circumstances described below and will not be capable
of rescission or termination by the Placee.
12. To the fullest extent permissible by law, none of the
Company, Numis 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 of these terms and conditions). In
particular, none of the Company, Numis or any of their respective
affiliates shall have any liability (including to the fullest
extent permissible by law, any fiduciary duties) in respect of
Numis' conduct of the Placing. Each Placee acknowledges and agrees
that the Company is responsible for the allotment of the Placing
Shares to the Placees and Numis shall have no liability to the
Placees for the failure of the Company to fulfil those obligations.
Nothing in this paragraph excludes the liability of any person for
fraud or misrepresentation made by that person.
Conditions of the Placing
Numis' obligations under the Placing Agreement in respect of the
Placing Shares are conditional on, inter alia:
(a) the Company allotting, subject only to Admission, the
Placing Shares in accordance with the Placing Agreement;
(b) Admission taking place not later than 8.00 a.m on 6 November 2017; and
(c) the passing (without any amendment, save as agreed by Numis)
of the Resolutions at the General Meeting.
If (i) any of the conditions contained in the Placing Agreement
in relation to the Placing Shares are not fulfilled or waived by
Numis by the respective time or date where specified (or such later
time or date as the Company and Numis may agree not being later
than 8.30 a.m. on 27 November 2017 (the "Final Date"), or (ii) the
Placing Agreement is terminated as described below, the Placing in
relation to the Placing Shares will lapse and the Placee's rights
and obligations hereunder in relation to the Placing Shares shall
cease and terminate at such time and each Placee agrees that no
claim can be made by the Placee in respect thereof.
Numis may, at its absolute discretion and upon such terms as it
thinks fit, waive, or extend the period (up to the Final 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, save that the condition relating to the passing of the
Resolutions and the condition relating to Admission taking place
may not be waived. Any such extension or waiver will not affect
Placees' commitments as set out in this Announcement.
Neither Numis 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 Numis.
Right to terminate under the Placing Agreement
Numis is entitled, at any time before Admission, to terminate
the Placing Agreement by giving notice to the Company in certain
circumstances, including, inter alia:
(a) in the opinion of Numis (acting in good faith), the
warranties given by the Company to Numis are not true and accurate
or have become misleading (or would not be true and accurate or
would be misleading if they were repeated at any time before
Admission) by reference to the facts subsisting at the time when
the notice referred to above is given, in each case in a way that
is material in the context of the Placing; or
(b) in the opinion of Numis (acting in good faith), the Company
fails to comply with any of its obligations under the Placing
Agreement and that failure is material in the context of the
Placing; or
(c) in the opinion of Numis (acting in good faith), there has
been a development or event (or any development or event involving
a prospective change of which the Company is, or might reasonably
be expected to be, aware) which will or is reasonably likely to
have a material adverse effect on or affecting the operations, the
condition (financial or otherwise), prospects, management, results
of operations, financial position, business or general affairs of
the Company or of the Company's group (taken as a whole)
respectively whether or not foreseeable and whether or not arising
in the ordinary course of business, which in each case is material
in the context of the Placing;
(d) there has been a change in national or international
financial, political, economic or stock market conditions (primary
or secondary); an incident of terrorism, outbreak or escalation of
hostilities, war, declaration of martial law or any other calamity
or crisis; a suspension or material limitation in trading of
securities generally on any stock exchange; any change in currency
exchange rates or exchange controls or a disruption of settlement
systems or a material disruption in commercial banking, in each
case as would be likely in the opinion of Numis (acting in good
faith) to materially prejudice the success of the Placing; or
(e) the Company's lending bank indicating that it is not
prepared to agree to the improved covenants and re-phasing of loan
amortization payments described in this Announcement.
Following 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 Numis of any right of termination or other
discretion under the Placing Agreement shall be within the absolute
discretion of Numis, 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 Numis, 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 Admission Document or Prospectus
The Placing Shares are being offered to a limited number of
specifically invited persons only and will not be offered in such a
way as to require an admission document or prospectus in the United
Kingdom or in any other jurisdiction. No offering document,
admission document or prospectus has been or will be submitted to
be approved by the FCA or submitted to the London Stock Exchange in
relation to the Placing, and Placees' commitments will be made
solely on the basis of the information contained in the
Announcement (including this Appendix) and the Exchange Information
(as defined further below). Each Placee, by accepting a
participation in the Placing, agrees that the content of this
Announcement is exclusively the responsibility of the Company and
confirms that it has neither received nor relied on any other
information (other than the Exchange Information), representation,
warranty, or statement made by or on behalf of the Company or Numis
or any other person and neither Numis 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 and, if given or made, such information, representation,
warranty or statement must not be relied upon as having been
authorised by Numis, the Company, or their respective officers,
directors, employees or agents. 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. Neither the Company, nor Numis are
making any undertaking or warranty to any Placee regarding the
legality of an investment in the Placing Shares by such Placee
under any legal, investment or similar laws or regulations. Each
Placee should not consider any information in this Announcement to
be legal, tax or business advice. Each Placee should consult its
own solicitor, tax adviser and financial adviser for independent
legal, tax and financial advice regarding an investment in the
Placing Shares. 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:
GB00B3NCXX73) following Admission will take place within CREST
provided that, subject to certain exceptions, Numis 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 deems 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 or contract note stating the number of Placing
Shares allocated to it at the Placing Price, the aggregate amount
owed by such Placee to Numis (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 Numis.
It is expected that settlement in respect of the Placing Shares
will be on 6 November 2017 in accordance with the instructions set
out in the trade confirmation.
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 Numis.
Each Placee is deemed to agree that, if it does not comply with
these obligations, Numis may sell any or all of the Placing Shares
allocated to that Placee on such Placee's behalf and retain from
the proceeds, for Numis' account and benefit (as agent for the
Company), an amount equal to the aggregate amount owed by the
Placee plus any interest due. The relevant Placee will, however,
remain liable and shall indemnify Numis 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
Numis all such authorities and powers necessary to carry out any
such sale and agrees to ratify and confirm all actions which Numis
lawfully takes 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
or contract note 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 Numis, namely
that, each Placee (and any person acting on such Placee's
behalf):
1. represents and warrants that it has read and understood the
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;
2. acknowledges that no offering document, admission document or
prospectus has been prepared in connection with the Placing and
represents and warrants that it has not received and will not
receive a prospectus, admission document or other offering document
in connection therewith;
3. acknowledges that the Ordinary 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
for Companies (collectively "Exchange Information"), which includes
the Company's most recent balance sheet and profit and loss account
and the Company's announcements and circulars published in the past
12 months and that it is able to obtain or access such information
without undue difficulty;
4. acknowledges that none of Numis, the Company, any of their
respective affiliates or any person acting on behalf of any of them
has provided it, and will not provide it, with any material
regarding the Placing Shares or the Company other than this
Announcement; nor has it requested any of Numis, the Company, their
respective affiliates or any person acting on behalf of any of them
to provide it with any such information and has read and understood
the Exchange Information;
5. acknowledges that the content of this Announcement is
exclusively the responsibility of the Company, and that none of
Numis, its affiliates or any person acting on its or their behalf
has or shall have any liability for any information, representation
or statement contained in this Announcement or any information
previously or concurrently published by or on behalf of the
Company, 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 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 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 Numis,
the Company or any of their respective directors, officers or
employees or any person acting on behalf of any of them, or, if
received, it has not relied upon any such information,
representations, warranties or statements (including any management
presentation that may have been received by any prospective Placee
or any material prepared by the Research Department of Numis (the
views of such Research Department not representing and being
independent from those of the Company and the Corporate Finance
Department of Numis and not being attributable to the same)), and
neither Numis 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 in deciding to participate in the Placing and it
will not rely on any investigation that Numis, its affiliates or
any other person acting on its or their behalf has or may have
conducted;
6. 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;
7. acknowledges that Numis 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 Numis is not acting for it or its clients and
that Numis will not be responsible for providing protections to it
or its clients;
8. acknowledges that none of Numis, any of its affiliates or any
person acting on behalf of it or them has or shall have any
liability for the Exchange Information, any publicly available or
filed 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;
9. that, save in the event of fraud on the part of Numis (and to
the extent permitted by the Rules of the FCA), neither Numis, its
ultimate holding company nor any direct or indirect subsidiary
undertakings of that holding company, nor any of their respective
directors and employees shall be liable to Placees for any matter
arising out of Numis' 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 you may have in
respect thereof;
10. represents and warrants that (i) it is not in the United
States and (ii) it is not acting for the account or benefit of a
person in the United States;
11. acknowledges that the Placing Shares are being offered and
sold only pursuant to Regulation S under the Securities Act in a
transaction not involving a public offering of securities in the
United States and the Placing Shares have not been and will not be
registered under the Securities Act or with any state or other
jurisdiction of the United States, nor approved or disapproved by
the US Securities and Exchange Commission, any state securities
commission in the United States or any other United States
regulatory authority, and that the offer and sale of the Placing
Shares to it has been made outside of the United States in an
'offshore transaction' (as such term is defined in Regulation S
under the Securities Act) and agrees not to reoffer, resell, pledge
or otherwise transfer the Placing Shares except pursuant to an
exemption from, or in a transaction not subject to, the
registration requirements of the Securities Act and otherwise in
accordance with any applicable securities laws of any state or
jurisdiction of the United States;
12. unless otherwise specifically agreed in writing with Numis,
represents and warrants that neither it nor the beneficial owner of
such Placing Shares is or will be a resident of Canada, Australia,
New Zealand, Japan or the Republic of South Africa;
13. acknowledges that the Placing Shares have not been and will
not be registered under the securities legislation of Canada,
Australia, New Zealand, Japan or the Republic of South Africa and,
subject to certain exceptions, may not be offered, sold, taken up,
renounced or delivered or transferred, directly or indirectly,
within those jurisdictions;
14. 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;
15. represents and warrants that: (i) it has complied with its
obligations under the Criminal Justice Act 1993 and the Market
Abuse Regulation (regulation 596/2014)("MAR"); (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 and the
Money Laundering Regulations 2017; and (iii) it is not a person:
(a) 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; (b)
named on the Consolidated List of Financial Sanctions Targets
maintained by HM Treasury of the United Kingdom; or (c) subject to
financial sanctions imposed pursuant to a regulation of the
European Union 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 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 Numis such evidence, if any, as to the identity or location or
legal status of any person which Numis 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) in the
form and manner requested by Numis 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 Numis may decide at its
sole discretion;
16. if a financial intermediary, as that term is used in Article
3(2) of the Prospectus Directive, 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 European Economic Area which has implemented
the Prospectus Directive other than Qualified Investors, or in
circumstances in which the prior consent of Numis has been given to
the offer or resale;
17. represents and warrants that it has not offered or sold and
will not offer or sell any Placing Shares to persons in the
European Economic Area 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 European Economic Area within the meaning
of the Prospectus Directive (including any relevant implementing
measure in any member state);
18. 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;
19. represents and warrants that it has complied and will comply
with all applicable provisions of MAR with respect to anything done
by it in relation to the Placing Shares in, from or otherwise
involving, the United Kingdom;
20. if in a Member State of the European Economic Area, unless
otherwise specifically agreed with Numis in writing, represents and
warrants that it is a Qualified Investor within the meaning of the
Prospectus Directive;
21. if in the United Kingdom, represents and warrants that it is
a person (i) who has professional experience in matters relating to
investments falling within Article 19(1) of the Order; (ii) falling
within Article 49(2)(A) to (D) ("High Net Worth Companies,
Unincorporated Associations, etc") of the Order; or (iii) to whom
this Announcement may otherwise be lawfully communicated;
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) 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: (a) to acquire the Placing Shares for each
managed account; (b) to make on its behalf the representations,
warranties, acknowledgements, undertakings and agreements in this
Appendix and the Announcement of which it forms part; and (c) to
receive on its behalf any investment letter relating to the Placing
in the form provided to it by Numis;
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 on the due time and date set out
herein, failing which the relevant Placing Shares may be placed
with other subscribers or sold as Numis may in its sole discretion
determine and without liability to such Placee and it will remain
liable and will indemnify Numis 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 Numis, 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 Numis and
that Numis has no duties or responsibilities to it for providing
the protections afforded to their respective 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 Numis 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 Numis in respect of the same on the basis that the
Placing Shares will be allotted to the CREST stock account of Numis
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 Wales and it submits (on
behalf of itself and on behalf of any person on whose behalf it is
acting) to the exclusive jurisdiction of the English courts as
regards any claim, dispute or matter (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 Numis 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, Numis 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 Numis 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, Numis 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, Numis or any person acting on behalf of the Company
or Numis 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 or
contract note will continue notwithstanding any amendment that may
in 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 Numis 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 Numis 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 Numis
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, allotment, 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 Numis in the event that
any of the Company and/or Numis 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 Numis 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 Numis 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 the Placee
acknowledges and agrees that Numis 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 the Placee is
dealing with Numis, any money held in an account with Numis on
behalf of the Placee and/or any person acting on behalf of the
Placee will not be treated as client money within the meaning of
the rules and regulations of the FCA made under the FSMA. The
Placee acknowledges that the money will not be subject to the
protections conferred by the client money rules; as a consequence,
this money will not be segregated from Numis' money in accordance
with the client money rules and will be used by Numis in the course
of its own business and the Placee will rank only as a general
creditor of Numis.
All times and dates in this Announcement may be subject to
amendment. Numis 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 independent financial adviser.
DEFINITIONS
In this Appendix to the Announcement and, as the context shall
admit, in the Announcement:
'Act' means the Companies Act 2006;
'Admission' means the admission of the Placing Shares to trading
on AIM becoming effective in accordance with the AIM Rules for
Companies;
'AIM' means the market of that name operated by the London Stock
Exchange;
'AIM Rules for Companies' means the provisions of the London
Stock Exchange's AIM Rules for Companies as amended from time to
time governing, inter alia, admission to AIM and the continuing
obligations of AIM companies;
'Announcement' means this announcement (including the appendix
to this announcement);
'Company' means Ubisense Group plc;
'Circular' means the circular to be issued by the Company to the
holders of Ordinary Shares containing, inter alia, further details
of the Placing and the Notice of General Meeting;
'CREST' means the relevant system (as defined in the CREST
Regulations) in respect of which Euroclear UK & Ireland Limited
is the Operator (as defined in the CREST Regulations);
'CREST Regulations' means the Uncertificated Securities
Regulations 2001 (SI 2001/3755) as amended from time to time;
'FCA' means the Financial Conduct Authority of the United
Kingdom;
'FSMA' means the Financial Services and Markets Act 2000 (as
amended);
'General Meeting' means the general meeting of the Company to be
convened at 10.00 am on 3 November 2017 (or any adjournment
thereof);
'Group' means the Company and its subsidiaries;
'London Stock Exchange' means London Stock Exchange plc;
'Notice of General Meeting' means the notice of the General
Meeting which is set out at the end of the Circular;
'Numis' means Numis Securities Limited, registered in England
and Wales with number 2285918, whose registered office is at 10
Paternoster Square, London EC4M 7LT;
'Ordinary Shares' means the ordinary shares of 2 pence each in
the capital of the Company;
'Placee' means any person (including individuals, funds or
otherwise) by whom or on whose behalf a commitment to acquire
Placing Shares has been given;
'Placing' means the placing of the Placing Shares by Numis, on
behalf of the Company, with Placees;
'Placing Agreement' means the placing agreement dated 18 October
2017 between the Company and Numis in respect of the Placing;
'Placing Price' means 32 pence per Placing Share;
'Placing Shares' means the 17,187,500 Ordinary Shares to be
issued pursuant to the Placing;
'Resolutions' means the resolutions to be proposed at the
General Meeting as set out in the Notice of General Meeting;
'Prospectus Directive' means the Directive of the European
Parliament and of the Council of the European Union 2003/71/EC;
'Securities Act' means the US Securities Act of 1933, as
amended;
'United Kingdom' or 'UK' means the United Kingdom of Great
Britain and Northern Ireland; and
'United States' or 'US' means the United States of America, its
territories and possessions, any state of the United States and the
District of Columbia.
This information is provided by RNS
The company news service from the London Stock Exchange
END
ROIGGGPWUUPMPWM
(END) Dow Jones Newswires
October 18, 2017 02:00 ET (06:00 GMT)
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