Placing, Subscription and Option Agreements
April 04 2003 - 8:21AM
UK Regulatory
BW20030404002014 20030404T122120Z UTC
( BW)(SYNIGENCE-PLC)(SYE) Placing, Subscription and Option Agreements
Business Editors
UK REGULATORY NEWS
LONDON--(BUSINESS WIRE)--April 4, 2003--
347241v5
SYNIGENCE Plc ("the Company" or "Synigence")
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- PLACING AND SUBSCRIPTION TO RAISE �900,000
- OPTION OVER MAJORITY INTEREST IN NASDAQ CASH SHELL
- POSSIBLE EARLY REPAYMENT OF LOAN STOCK AT DISCOUNT
Placing, Subscription and Option Agreements
The Company announced today that:
- The Company has entered into two subscription agreements
whereby certain directors of the Company and others will
subscribe, in aggregate, for 4.5 million new ordinary shares
at 10p each to raise �450,000.
- Collins Stewart Limited has agreed to place 3 million new ordinary
shares at 10p each to raise approximately �275,000, net of expenses.
- The Company has also acquired an option to purchase not less
than 60% of the total issued stock in a NASDAQ company ("N
Corp") incorporated in Delaware, USA. The option, which has
been granted for a consideration of �1, is exercisable at the
sole discretion of the Company prior to 31st May 2003. The
Consideration payable on exercise is �850,000, which is to be
satisfied by the issue of 3,000,000 ordinary shares in the
Company at a price of 10p per share and the issue of �550,000
2% Unsecured Convertible Loan Stock which is repayable on 1st
January 2005 in either cash or ordinary shares in the Company
at its sole discretion.
- Further, in the event that the option over N Corp shares is
exercised and sufficient cash is realised or distributed in
whatever manner by N Corp to the Company prior to 31st May
2003, the Company has agreed with the holder of �1.5 million
of 2% Unsecured Convertible Loan Stock, due for repayment on
1st January 2004 and on 1st January 2005, that �1 million of
this loan stock will be redeemed in cash at a discount of 20
per cent (leaving a balance of �500,000 repayable on 1st
January 2004) and, simultaneously, the loan stock holder will
subscribe for 1,500,000 new ordinary shares in the Company at
10p per share.
- The proceeds of the placing and subscriptions will be used to provide the Company with working capital.
Application will be made for the shares to be issued by the Company as
a result of these transactions to be admitted to trading on the
Alternative Investment Market of the London Stock Exchange, with
admission of 6 million shares expected to take place on 11th April
2003 and admission of the balance expected to take place by 10th July
2003.
Details of Option
The Company has acquired for �1 an option to purchase common stock in
N Corp, amounting to not less than 60% of N Corp's issued capital.
The Option Agreement provides that N Corp shall have minimum net
assets of $2.7 million (in cash and bonds being a mixture of corporate
and Treasury).
In the event that the option is exercised, the resulting consideration
will be satisfied by the issue of 3,000,000 ordinary shares in
Synigence at 10p per share together with the issue of �550,000 2%
Unsecured Convertible Loan Stock, repayable on 1st January 2005 in
cash or in ordinary shares in Synigence, at its sole option.
At Completion of the Company's purchase of the majority interest in N
Corp, Keith Bushnell, Dr. William Bird and Tony Thompson, together
with the Company's US resident consultant, Bruce Mullen, will be
appointed as directors and thereafter steps will be taken to change
the name of the company to Clinnix USA Inc., ("CUSA"). Synigence
intends to appoint CUSA as the sole distributor of its new consumer
product, Clinnix CBRN, (Chemical, Biological, Radiological and
Nuclear) for the USA under licence.
Placing and Subscriptions
The Company has:
- entered into a subscription agreement whereby certain
directors, their family interests, and a US based consultant
will subscribe, in aggregate, for 3,000,000 ordinary shares
in the Company at 10p per share to raise �300,000 subject
only to the shares being admitted to trading on AIM. The
issue of these shares is expected to become effective on 11th
April 2003;
- entered into a placing agreement with Collins Stewart
Limited, under which Collins Stewart Limited has agreed to
place a further 3,000,000 ordinary shares in the Company at
10p per share to raise a further �275,000, after expenses,
subject only to the shares being admitted to trading on AIM.
The issue of these shares is expected to become effective on
11th April 2003;
- entered into a subscription agreement whereby a private investor will subscribe for 1,500,000 ordinary shares in the Company
at 10p per share to be paid no later than 30th June 2003; and
- agreed that, should the option over N Corp shares be
exercised and the requisite cash distribution or realisation
be effected prior to 31st May 2003, a subscription at 10p per
share for a further 1,500,000 ordinary shares in the Company
will take place simultaneously with the redemption in cash,
at a 20 per cent. discount, of �1 million of 2% Unsecured
Convertible Loan Stock which is due for repayment on 1st
January 2005.
Effects of Transactions
In the event that the option over the N Corp shares is exercised and
substantially all of the Company's resultant interest in the expected
minimum amount of net assets of N Corp are distributed or realised by
the Company, upon completion, the Company will have:
- purchased the majority interest in a cash shell Nasdaq quoted
company, which the Company intends to appoint as sole
distributor of its CBRN and other consumer products for the
USA under licence;
- redeemed �1 million of 2% Unsecured Convertible Loan Stock
otherwise redeemable on 1st January 2005 at a price of
�800,000, being a 20% discount, and thereby, after taking
into account the consideration payable for the acquisition of
N Corp, effectively reduced the amount of indebtedness of the
Company by some �450,000;
- raised approximately �1.8 million cash; and
- issued 12 million new ordinary shares.
In the event that the option is not exercised by 31st May 2003, the
Board still considers that the Company will have sufficient working
capital but will review and evaluate the need for, and the amount of,
any further working capital that may be required until the Company is
cash positive.
After the Subscription and Placing shares have been issued, the Board
has the power to issue a further 4.5 million ordinary shares without
further reference to shareholders. This will increase to some 18
million shares should the proposed resolution be passed by
shareholders at the forthcoming extraordinary general meeting.
Current Trading
During the financial year to 31st December 2002, a huge amount of work
went into:
1. Restructuring the Board following a �6 million loss for the financial year ended 31st December 2001;
2. Recruiting high quality personnel to enable the Company to take control of its commercial destiny instead of exclusively
relying on third parties to market the Company's services and products;
3. Undertaking a complete upgrading of the Company's products and services to ensure that they are of benefit and value to
potential customers;
4. Building internal processes to ensure deliverability of projects to customers;
5. Acquiring HMG Worldwide; and
6. Reducing the headcount and other overhead costs whilst
achieving the above. Excluding restructuring costs, such as
redundancy costs, operating expenses were reduced by almost
half during the past financial year from the previous �6.5
million.
This work has transformed the Company's commercial prospects for this
and future financial years and, as an indication, the Board are
confident that Q1 revenues in 2003 should be the equal of full year
revenues for the financial year ending 31st December 2002.
The Company's new consumer product, Clinnix CBRN, is receiving high
profile media coverage in the UK and the USA and the Board anticipates
this driving revenues beginning Q2 of 2003.
Clinnix CBRN is the first of a range of specialist health risk
products in the Clinnix Health Manager family and the second such
product (Clinnix Smoking Cessation) is planned for launch in Q2 of
2003 both in the UK and the USA.
Extraordinary Meeting of Shareholders
As a result of the issue of the shares, and to enable the Company to
take advantage of opportunities, particularly acquisition
opportunities, the Company will call an Extraordinary Meeting of
shareholders before 10th May 2003 for the purpose of renewing its
powers to issue a further 15% of the increased issued capital for cash
without the need for further specific shareholder approval where and
if required prior to the date of the next Annual General Meeting,
which is not expected to be held before June 2003. A circular
convening the Extraordinary General Meeting will be sent to
shareholders as soon as is practicable.
Chairman's Comments:
Tony Thompson, the Chairman of Synigence comments:
"The last fifteen months have been, without a doubt, the hardest but
most constructive in the history of the Company. It is no coincidence
that this is the time that our CEO, Keith Bushnell, has been with us
and he deserves great credit for bringing about the necessary changes
in personnel, working practices, and quality of staff and products,
during that period.
As a result of this work, the Company entered 2003 confident that the
corner will be turned in the first half of 2003 and it will not be
very long before the Company ceases to be "cash spending" and becomes
"cash accreting". The Board's firm belief that this is the case is
reflected in the substantial investment by directors."
For further information, please contact:
Keith Bushnell (CEO) Tel: 0118 9816666
Mob: 07976 300915
NOTE - The principal business of Synigence plc is the provision of
healthcare content, related value added services and the development
and provision of communication technology and solutions. The
opportunity to market these products is being created by the
distribution of the necessary software, known as Clinnix Pro to
healthcare professionals and as Clinnix Health Manager to
patients/consumers who are able to self monitor their health and
transmit (with their permission) their outcomes directly to healthcare
professionals where appropriate
Short Name: Synigence PLC
Category Code: MSC
Sequence Number: 00003654
Time of Receipt (offset from UTC): 20030404T131751+0100
--30--ac/uk*
CONTACT: Synigence PLC
KEYWORD: UNITED KINGDOM INTERNATIONAL EUROPE
INDUSTRY KEYWORD: BIOTECHNOLOGY
SOURCE: Synigence PLC
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