Eco City Vehicles (ECV) - Update on trading, Placing and Directorate Changes RNS Number : 8056L Eco City Vehicles PLC 07 September 2012 7 September 2012 Eco City Vehicles PLC ("ECV", "Company" or "Group") Update on trading, firm share placing, revised financing arrangements and Board changes Eco City Vehicles, a developer and supplier of the London licensed Mercedes taxi, is pleased to make the following announcements to strengthen the business and position it for future long term growth. Summary · Update on trading with strong growth in new Mercedes Vito sales and market share achieved in the first seven months of 2012 · Firm share placing to raise £1.75 million to reduce debt and boost working capital · Board changes to position the Company for next phase of development · Revised loan repayment arrangements · Acquiring the benefit of a loan provided to One80 Limited secured against certain of its assets Current trading The Company has experienced strong trading in the first seven months of 2012 against a challenging economic and industry environment. This reflects increasing momentum of sales and popularity for the latest Mercedes Vito Euro V model. Throughout the seven-month period, ECV continued to enjoy solid demand for the Mercedes Vito. Based on Transport for London (TfL) data, the Mercedes Vito increased its share of the new London licensed taxi market to 36% in the first seven months of the year, up from a market share of 22% in the same period last year. New Vito taxi licenses increased by 102% to 354 vehicles in the first seven months against 175 in the same period last year, and 331 for the whole of 2011. This means that new licenses in the first seven months of 2012 represented 107% of the annual license sales achieved last year. The latest version of the Blue Efficiency Vito taxi, which was launched a year ago, complies with stringent new European Union vehicle emission standards as well as providing superior quality, improved fuel efficiency, comfort and six-seat capacity. Share Placing ECV has raised £1.75 million (before expenses) through a firm placing of 116,666,666 ordinary shares at 1.5 pence per share (the "Placing") The Company has undertaken the Placing to certain new and existing institutional investors at a price of 1.5 pence per share (representing a discount of approximately 18 per cent. against the closing mid-market price on 6 September 2012). The net proceeds of the Placing will be used to repay debt, fund capital investment and to provide additional working capital to support the growth of the Company. The new funds will reduce the Group's borrowing by £0.6 million from approximately £3.8 million to approximately £3.2 million. Further details of the proposed use of the Placing proceeds and the terms of the Placing are set out below. Board Changes The Company also announces that it proposes to make certain changes to its Board following the completion of the Placing in order to lead the Company through the next phase in its development. The Company intends to seek a new Chief Executive Officer ("CEO") and, once a suitable candidate is confirmed, Peter DaCosta intends to assume a Non-Executive Director role. Whilst Mr DaCosta's intention is to reduce his time-commitment to the Company, he expects to remain actively involved with the Company and, in addition to providing the benefit of his substantial industry experience, his focus will be on sourcing and assessing new opportunities. The process for recruiting a new CEO will be led by John Swingewood. The Company also announces that Tim Yeo will retire from the Board on completion of the Placing, to be replaced as chairman by John Swingewood. Tim, who has chaired the Company since its admission to AIM in October 2007, has recently taken on new chairmanships in the education and energy sectors and wishes to devote more time to those. Keith Marder is also stepping down from the Board on completion of the Placing but will remain as an employee of the business and a director of the Company's subsidiaries. Tim Yeo non-executive chairman of ECV, said: "I am pleased that the Company is making good progress after a challenging period. Now that trading has improved and the Company's finances are being put on a stronger footing it is the right time for management and board level changes to position the business for the future. My successor, John Swingewood, will be able to lead the process of recruiting a new Chief Executive and I wish him and the Company every success in future." John Swingewood, chairman delegate, said: "We are delighted to announce the successful fundraising which puts us in an excellent position. We are all extremely grateful for the skilful leadership and commitment Tim has given the Company in his five years as Chairman. I look forward to recruiting a new Chief Executive and increasing the Company's market share. " Enquiries: Eco City Vehicles plc Peter DaCosta, Chief Executive Officer +44 20 7377 2182 Ran Oren, Finance Director Luther Pendragon Neil Thapar, Alexis Gore +44 20 7618 9100 Numis Securities Limited Stuart Skinner (Nominated Adviser) +44 20 7260 1000 David Poutney (Corporate Broker) Use of proceeds The net funds raised from the Placing will be used principally for the following purposes: · Repayment of £0.25 million of debt owed to the KPM-UK Taxi Plc Discretionary Pension Scheme (the "Pension Scheme") · Capital investment of approximately £0.1 million in infrastructure, enabling part of the after sales division to obtain an accreditation which will enable the division to diversify its revenue streams · Repayment of £0.1 million of debt owed to Lee DaCosta, the son of director Peter DaCosta · Working capital: funds will also be used to provide additional working capital to the business Financing arrangements As at the date of this announcement and before deployment of any of the net funds raised from the Placing, the Company has various outstanding liabilities with related parties and its directors (in relation to unpaid bonuses, fees and loans) which are being restructured. Further details of these arrangements are set out in appendix 1. The Directors believe that these new arrangements together with the Placing proceeds provide the Company with substantially increased clarity in respect of the expected repayment profile of its key liabilities and materially strengthen its financial position. The current economic climate makes forecasting difficult and the Board will continue to monitor the Company's financial position having regard to its ongoing trading performance. Related Party Transactions The transactions entered into with the beneficiaries of the Pension Scheme, Global Meter Systems Limited, Peter DaCosta and Keith Marder in respect of the outstanding loans and bonus payments due to them referred to in appendix 1 are related party transactions and, for the purposes of Rule 13 of the AIM Rules, the Company's directors consider, having consulted with its nominated adviser, that the terms of such transactions are fair and reasonable insofar as its shareholders are concerned. EIS Relief The Company has received provisional confirmation from HMRC that the Placing Shares are eligible for relief under the Enterprise Investment Scheme. Terms of the Placing The Placing comprises a placing of 116,666,666ordinary shares in the Company (the "Placing Shares"), which are expected to be admitted to trading on AIM on 13 September ("Admission"). The Placing Shares have been placed at 1.5 pence per share (the "Placing Price") with new and existing institutional investors. The Placing will raise proceeds of £1,750,000 before expenses for the Company. The Placing Price of 1.5 pence per share represents a discount of approximately 18 per cent. to the closing price of 1.825 pence per ordinary share on 6 September 2012 (being the last business day prior to this announcement). Under the terms of the placing agreement, Numis, as agent for the Company, has agreed to use its reasonable endeavours to procure placees for the Placing Shares at the Placing Price. Numis will be paid an advisory fee and a placing commission, from which it will settle any sub-placing commissions payable. The Placing Shares will represent approximately 26 per cent. of the enlarged share capital of the Company. The Placing Share will be in registered form and capable of being held in certificated form or uncertificated form in CREST. The Placing is conditional, inter alia, upon the placing agreement becoming unconditional, and admission of the Placing Shares to trading on AIM becoming effective. The Placing is not being underwritten. 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. Numis is entitled to terminate the Placing Agreement in certain circumstances prior to Admission, including, inter alia,where any of the warranties are found not to be true or accurate or were misleading in any material respect or on the occurrence of certainforce majeureevents. Peter DaCosta, Michael Troullis and Keith Marder have agreed to enter into lock-in agreements with the Company and Numis whereby they have agreed not to dispose of any shares in the Company for a period of six months from the date of completion of the placing, and have agreed to certain orderly marketing restrictions for a period of 12 months after expiry of that six month period. Application will be made to the London Stock Exchange for the Placing Shares to be admitted to trading on AIM. It is expected that Admission will become effective and that trading in the Placing Shares will commence on AIM at 8.00 a.m. on 13 September 2012. The Placing Shares will, when issued and fully paid, rank pari passu in all respects with the existing ordinary shares, including the right to receive any dividend or other distribution declared, made or paid after Admission. One80 Limited There is no update to the position in relation to One80 disclosed on 20 July 2012. As at the date of this announcement the valuation report required under s593 Companies Act 2006 has not been completed and no shares in the capital of ECV have been issued to the seller. The Company will release further updates as appropriate. ECV is the legal and beneficial holder of 16,250 A ordinary shares of £0.01 each in the capital of One80, representing 61.9% of its total issued share capital. ECV also holds the beneficial interest in 3,850 B ordinary shares of £0.01 each, such interest having been acquired from Jevon Thurston-Thorpe pursuant to the transaction described in the announcement dated 20 July 2012. These shares represent a further 14.67% of One80's total issued share capital, and ECV has voting control in relation to such shares. Accordingly, ECV has control of 76.6% of the voting rights in One80. One80 is party to a licence agreement, signed in July 2011, which provides a fixed licence fee per Vito taxi produced with a minimum guaranteed level of 450 units per annum. The transfer of second stage manufacture to Mercedes-Benz enabled One80 to reduce its cost base and moved One80 into an EBITDA positive position. One80 owns the intellectual property rights to the rear wheel steer technology used on the Mercedes Vito taxi. The Company has entered into an agreement to acquire the benefit of a £250,000 short-term loan made to One80 by Cabvision Network Limited. The acquisition of the benefit of the One80 Loan by ECV will ensure that the One80 Loan and the related security over One80's assets are under the control of ECV as majority shareholder rather than an external party. As a result ECV will control the enforceability of the loan and related security over the relevant assets of One80, which are important to the business of ECV. Further details are set out in appendix 1. Cabvision settlement On 13 July 2012 ECV and certain other group companies entered into an agreement with a number of third parties which, together with a separate agreement concluded on 6 July 2012 with other parties who had claims against Cabvision Limited, effects a full and final settlement of all outstanding claims against Cabvision Limited, ECV and the other group companies. The settlement has removed all and any risk of claims against or liability of the Group under Section 51 of the Senior Courts Act 1981 or otherwise. APPENDIX 1 FINANCING ARRANGEMENTS As at the date of this announcement, and before the deployment of any of the net funds raised from the Placing, the outstanding liabilities of the Company and its subsidiaries (the "Group") include the following: · £1.5 million owing to the Pension Scheme, whose beneficiaries are Peter DaCosta, Michael Troullis and Keith Marder (all directors and/or shareholders of ECV) (the "Pension Scheme Loan") together with accrued interest of £66,120 as at 31 August 2012; · accrued rent arrears of approximately £200,000 owing to the Pension Scheme relating to premises owned by the Pension Scheme; · £514,000 in outstanding arrears owing to Global Meter Systems Limited (the "Global Meters Arrears"); · £60,964 owing to executive directors in respect of loans they have made to the Company; · £126,000 in deferred gross bonuses owing to executive directors together with employer national insurance contributions in relation thereto; · £97,500 in deferred fees owing to non-executive directors; · £100,000 owing to Lee DaCosta, the son of director Peter DaCosta; and · £250,000 plus accrued interest owing to Cabvision Networks Limited. The Pension Scheme Loan The Pension Scheme Loan was provided in various tranches and was due to be repaid in tranches on various dates as previously announced on 2 May and 22 June 2012. However, the beneficiaries of the Pension Scheme (being Peter DaCosta, Keith Marder and Michael Troullis) and the Company have now agreed revised repayment terms, pursuant to which £0.25 million, including associated expenses, will be paid out of the Placing Proceeds. In accordance with these revised repayment terms, repayment of the remaining £1.25 million outstanding principal amount will commence: (a) once the Company has achieved a cumulative consolidated EBITDA of £1 million on a consolidated basis (the "Target"), to be measured on a monthly basis from 1 September 2012; and (b) once the loan of £250,000 owed by the trustees of the Pension Scheme to Barclays Bank plc has been repaid (which the beneficiaries have undertaken to repay using the £250,000 Pension Scheme Loan repayment referred to above), (together the "Repayment Conditions"). Repayments will be made in monthly instalments of £20,800, starting in the month after the Target is met and ending in September 2017. The remaining balance outstanding at September 2017 will be repaid but, subject to compliance with H M Revenue and Customs' rules, will be re-lent to the Company on substantially similar terms to those described in this paragraph. Interest will accrue at a rate of 5% per annum from the date of this Announcement and will be payable on 31 December 2012 and on 31 December in each year thereafter (subject to the Repayment Conditions being satisfied). Interest accrued up to 31 August 2012, totalling £66,120, and interest accruing thereafter, up to a total of £33,880, will be deferred and paid in 12 monthly payments which will commence after satisfaction of the Repayment Conditions. It has also been agreed that arrears of rent of approximately £200,000 in respect of premises owned by the Pension Scheme and occupied by the Company, will be paid in equal monthly instalments over a period of 12 months once the Repayment Conditions have been satisfied. Interest will accrue on the arrears at a rate of 5% per annum. KPM-UK Taxes Plc, a wholly owned subsidiary of the Company, has the benefit of a claim for a refund of VAT in an amount of up to £2.8m ("VAT Claim"). The Company has agreed that any compensation net of corporation tax received from HMRC as a result of the VAT Claim will be applied firstly in repayment of the Pension Scheme Loan and secondly (provided the Pension Scheme Loan has been repaid in full) in repayment of the Global Meters Arrears. The beneficiaries of the Pension Scheme have also agreed to use all reasonable endeavours to procure that the trustees of the Pension Scheme offer reasonable alternative repayment terms to the Company in the event that the Company, acting reasonably, is unable to meet the revised repayment terms described above (subject always to compliance with HMRC rules). The revised repayment terms described above require the approval of the corporate trustee of the Pension Scheme. The beneficiaries of the Pension Scheme have agreed to use all reasonable endeavours to ensure that the necessary documentation is entered into by the Pension Scheme trustees within 30 business days of the date of this Announcement to give effect to these revised terms. A further announcement will be made at that point. The revised repayment terms set out above therefore remain subject to the agreement of the Pension Scheme trustees and no guarantee can be given at this stage that they will agree to such terms. The parties have further agreed that once the Company is in a position to pay a dividend then the Company shall be permitted to increase the amount of repayments of the Pension Scheme Loans to an amount equal to the amount of any dividends paid, such amount to be allocated by the Company between the Pension Scheme Loan and the Global Meters Arrears described below. The Global Meters Arrears Repayment of the Global Meters Arrears will commence following completion of the Placing and once the £250,000 loan owed by the Pension Scheme to Barclays Bank Plc has been repaid. It will be repaid by way of monthly payments of £10,000. Interest will accrue from the date of this Announcement at a rate equal to 5% per annum payable on 31 December 2012 and on 31December in each year thereafter, subject to the repayment of the Pension Scheme Loan from Barclays Bank plc as described above. As described above the Company may increase payments to Global Meters provided such payments are matched by dividends, and do not exceed the amount of any dividends when aggregated with any additional repayments made under the Pension Scheme Loan. Amounts owing to directors The Company has agreed with Peter DaCosta and Keith Marder that the outstanding loans of £12,450 and £48,514 respectively made by them to the Company will be repaid to each of them in equal monthly instalments of in aggregate £5,000 commencing in the month following the Placing or, if later, once the £250,000 loan owed by the Pension Scheme to Barclays Bank Plc has been repaid. Interest will accrue at a rate of 5% per annum. Both Mr DaCosta and Mr Marder have been granted options to convert the outstanding balance of the loans to ECV shares at 1.5p per share, to be exercised at any time in the period of six months commencing on completion of the Placing. The outstanding bonus payments of £63,000 owed to each of Mr DaCosta and Mr Marder will be satisfied by the issue to each of them of such number of ECV shares at 1.5p per share having an aggregate value equal to 50% of the bonus payment after income tax and national insurance contributions have been paid, with the remaining sum being repaid in cash in monthly repayments of £5,000, such repayments to commence following repayment of the loans referred to above. Interest will accrue on the amount owed at a rate of 5% per annum. Any outstanding bonus balance will be repaid in cash upon either of Mr DaCosta or Mr Marder leaving the Company. Both Mr DaCosta and Mr Marder have been granted options to convert the remaining outstanding balance of the bonus payments to ECV shares at 1.5p per share, to be exercised at any time in the period of six months commencing on completion of the Placing. Further, John Swingewood and Jeremy Fenn, non-executive directors of the Company, are each owed fees of £27,000 and £19,500 respectively by the Company. They have each agreed to receive ECV shares in lieu of those fees, at 1.5p per share. They have also agreed to use the fees that will be payable to them over the next 12 months to purchase ECV shares, at 1.5p per share, on a quarterly basis. Tim Yeo will also receive approximately £51,000 in relation to fees owed to him for the period from October 2011 and in respect of his three month notice period. Amount owing to Lee DaCosta In January 2011 the Group received an interest-free loan from Lee DaCosta of £100,000 which will be repaid following completion of the Placing. Acquisition of One80 Loan The Company has entered into an agreement to acquire the benefit of a £250,000 short-term loan at par (plus accrued unpaid interest) made to One80 by Cabvision Network Limited (the "One80 Loan"). The One80 Loan was made to One80 in August 2011 as a short-term facility, is secured against certain of the assets of One80 and carries interest of 3% per month. The acquisition of the benefit of the One80 Loan by ECV will ensure that the One80 Loan and the related security over One80's assets are under the control of ECV as majority shareholder rather than an external party. As a result ECV will control the enforceability of the loan and related security over the relevant assets of One80, which are important to the business of ECV. The secured assets include the rear wheel steer technology developed and owned by One80 which is used on the Mercedes Vito taxi. The technology is installed in Mercedes Vito taxis in order to meet the Conditions of Fitness of the Public Carriage Office of Transport for London. The agreement is conditional on payment of £250,000 plus interest and on payment of the £100,000 due to Lee DaCosta, as described above. APPENDIX 2 TERMS AND CONDITIONS OF THE PLACING IMPORTANT INFORMATION FOR INVITED PLACEES ONLY REGARDING THE PLACING THIS ANNOUNCEMENT, INCLUDING THIS APPENDIX (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, AUSTRALIA, CANADA, JAPAN, THE REPUBLIC OF SOUTH AFRICA OR ANY OTHER JURISDICTION IN WHICH SUCH PUBLICATION OR DISTRIBUTION WOULD BE UNLAWFUL. MEMBERS OF THE PUBLIC ARE NOT ELIGIBLE TO TAKE PART IN THE PLACING. THIS APPENDIX 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 AMENDED, ("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 (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 APPENDIX 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 APPENDIX AND THE TERMS AND CONDITIONS SET OUT HEREIN RELATES IS AVAILABLE ONLY TO RELEVANT PERSONS AND WILL BE ENGAGED IN ONLY WITH RELEVANT PERSONS. THE ANNOUNCEMENT INCLUDING THIS APPENDIX 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. THE ANNOUNCEMENT INCLUDING THIS APPENDIX 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 JURISDICTION. THE ANNOUNCEMENT INCLUDING THIS APPENDIX 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 AMENDED (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 OR ENDORSED THE MERITS OF THE PLACING OR THE ACCURACY OR ADEQUACY OF THE CONTENTS OF THIS ANNOUNCEMENT. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE 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 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 in the Placing have not been acquired on behalf of, nor have they been acquired with a view to their offer or resale to, persons in any 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; 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 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; 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, Australia, Canada, Japan or the Republic of South Africa or in any other 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 ("Regulation S"). 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 Australia, Canada, Japan or the Republic of South Africa. Accordingly, the Placing Shares may not (unless an exemption under the relevant securities laws is applicable) be offered, sold, resold or delivered, directly or indirectly, in or into Australia, Canada, Japan or the Republic of South Africa or any other jurisdiction outside the United Kingdom. Persons (including, without limitation, nominees and trustees) who have a contractual 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 others) on whose behalf a commitment to subscribe for Placing Shares has been given. Details of the Placing Agreement and the Placing Shares Numis has entered into a Placing Agreement (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. The Placing has not been underwritten. The Placing Shares will, when issued and fully paid, rank pari passu in all respects with the existing issued ordinary shares in the capital of the Company ("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 180 days from the date of Admission without Numis's prior consent, such consent not to be unreasonably withheld. Application for admission to trading Application will be made to the London Stock Exchange for admission to trading of the Placing Shares on AIM ("Admission"). It is expected that settlement of any such shares and Admission will become effective on or around 13 September 2012 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 1.5 pence per New Ordinary Share (the "Placing Price"). 5. Each Placee's allocation will be confirmed to Placees orally by Numis, and a trade confirmation or contract note will be dispatched as soon as possible thereafter. 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. 6. 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. 7. 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". 8. 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". 9. By participating in the Placing, each Placee will agree that its rights and obligations in respect of the Placing will terminate only in the circumstances described below and will not be capable of rescission or termination by the Placee. 10. To the fullest extent permissible by law, 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. Conditions of the Placing Numis' obligations under the Placing Agreement in respect of the Placing Shares are conditional on, inter alia: (a) the warranties contained in the Placing Agreement being true, accurate and not misleading as at the date of the Placing Agreement and at all times before Admission as though they had been given and made on such dates (by reference to the facts and circumstances existing at such dates); (b) the Company allotting, subject only to Admission, the Placing Shares in accordance with the Placing Agreement; (c) Admission taking place not later than 8.00 a.m on 13 September 2012 or such later date as the Company and Numis may otherwise agree not being later than 8.00 a.m on 27 September 2012; (d) there having been no Material Adverse Change (as defined in the Placing Agreement) prior to Admission; and (e) the Placing Agreement not having lapsed or been terminated prior to Admission. 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 8.00 a.m on 27 September 2012), 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 and any funds delivered by Placee to Numis will be returned without interest as soon as reasonably practicable (and at each Placee's risk). Numis may, at its discretion and upon such terms as it thinks fit, waive, or extend the period 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 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 breach of the warranties given to Numis in the Placing Agreement, the failure of the Company to comply with obligations under the Placing Agreement or, the occurrence of a force majeure event which, in the good faith opinion of Numis, make it impracticable or inadvisable to market the Placing Shares or to enforce contracts for the subscription of the Placing Shares. 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 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 Financial Services Authority ("FSA") 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: GB0034353754) 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, in accordance with the standing arrangements in place with Numis, stating the number of Placing Shares allocated to it at the Placing Price, the aggregate amount owed by such Placee to Numis 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 standing CREST or certificated settlement instructions that it has in place with Numis. It is expected that settlement will be on 13 September 2012 on a T+3 basis 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: 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; 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 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 FSA'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 person acting on behalf of it or them, or any of its affiliates 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 FSA), 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 Investors 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 Investors 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 will be a resident of Australia, Canada, 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 Australia, Canada, 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, section 118 of FSMA and in connection with money laundering and terrorist financing under the Proceeds of Crime Act 2002 (as amended), the Terrorism Act 2000 (as amended), the Terrorism Act 2006 and the Money Laundering Regulations 2007 and (ii) 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, 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 the FSMA 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 Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 (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; 37. irrevocably appoints any director or employee of Numis as its agent for the purpose of executing and delivering to the Company and/or its registrars any document on its behalf necessary to enable it to be registered as the holder of Placing Shares; 38. acknowledges that its name and participation in the Placing may be disclosed if required by law or any applicable rules or regulations including the AIM Rules for Companies of the Takeover Code; and 39. 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 FSA 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 2: 'Admission' means the admission of the Placing Shares to trading on AIM becoming effective (pursuant to Rule 6 of the AIM Rules for Companies); 'Announcement' means this announcement (including the appendices to this announcement); 'CREST' means the relevant system, as defined in the Uncertificated Securities Regulations 2001 (SI 2001/3755), as amended (in respect of which Euroclear UK & Ireland Limited is the operator); 'FSA' means the Financial Services Authority of the United Kingdom acting in its capacity as the competent authority for the purposes of Part IV of FSMA; 'FSMA' means the Financial Services and Markets Act 2000 (as amended); 'London Stock Exchange' means the London Stock Exchange plc; the 'Company' means Eco City Vehicles plc; 'Ordinary Share' means an ordinary share of 1 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 both new and existing institutional investors; 'Placing Agreement' means the placing agreement dated 7 September 2012 between the Company and Numis in respect of the Placing; 'Placing Price' means 1.5 pence per Ordinary Share at which the Placing Shares are placed; 'Placing Shares' means the up to 116,666,666 Ordinary Shares to be issued pursuant to the Placing; '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 MSCFMGGLFNVGZZM -0- Sep/07/2012 13:39 GMT
Eco City Vehicles ECV Update on trading, Placing and Directorate Changes
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