THIS ANNOUNCEMENT AND THE INFORMATION CONTAINED
HEREIN IS RESTRICTED AND IS NOT FOR RELEASE, PUBLICATION OR
DISTRIBUTION, IN WHOLE OR IN PART, DIRECTLY OR INDIRECTLY, IN, INTO
OR FROM THE UNITED STATES, AUSTRALIA, CANADA, THE REPUBLIC OF SOUTH
AFRICA OR JAPAN OR ANY OTHER JURISDICTION IN WHICH SUCH RELEASE,
PUBLICATION OR DISTRIBUTION WOULD BE UNLAWFUL. PLEASE SEE THE
IMPORTANT NOTICES AT THE END OF THIS
ANNOUNCEMENT.
THIS ANNOUNCEMENT IS FOR INFORMATION PURPOSES
ONLY AND DOES NOT CONSTITUTE OR CONTAIN ANY INVITATION,
SOLICITATION, RECOMMENDATION, OFFER OR ADVICE TO ANY PERSON TO
PURCHASE AND/OR SUBSCRIBE FOR, OTHERWISE ACQUIRE OR DISPOSE OF ANY
SECURITIES IN EARNZ PLC OR ANY OTHER ENTITY IN ANY
JURISDICTION. NEITHER THIS ANNOUNCEMENT NOR THE FACT OF ITS
DISTRIBUTION, SHALL FORM THE BASIS OF, OR BE RELIED ON IN
CONNECTION WITH ANY INVESTMENT DECISION IN RESPECT OF EARNZ
PLC.
THIS ANNOUNCEMENT CONTAINS INSIDE
INFORMATION.
For immediate
release
18 March
2024
EARNZ
plc
("EARNZ" or the "Company")
Proposed
Consolidation
Proposed
Fundraising to raise £3.7 million
and
Loan
Conversion
Introduction
EARNZ plc (AIM: EARN),
an AIM Rule 15 cash shell which is seeking acquisitions in the
energy services sector, is pleased to announce:
- a proposed consolidation of
every 100 ordinary shares of 0.04 pence each ("Existing
Shares") in the capital of
EARNZ into one new ordinary share of 4 pence each
("Consolidated
Shares") in the capital of
EARNZ (the "Consolidation");
- a proposed placing of
39,954,644 New Ordinary Shares (as defined below) (the
"Placing
Shares") at a price of 7.5 pence per
Placing Share (equivalent of 0.075 pence prior to
the Consolidation) (the "Issue
Price")
to raise approximately £3.0 million
(before expenses) (the "Placing"); and
- a proposed subscription of
9,378,689 New Ordinary Shares (the "Subscription
Shares") at the Issue Price,
to raise approximately £0.7 million (before expenses) (the
"Subscription")
(together, with the Placing, the "Fundraising",
and together with the Consolidation and the Loan Conversion,
the "Proposals").
Capitalised terms used
in this announcement (the "Announcement")
have the meanings given to them in the section headed "Definitions"
at the end of this Announcement, unless the context provides
otherwise.
Shore Capital and
Corporate Limited ("SCC") is acting as nominated adviser to EARNZ and
Shore Capital Stockbrokers Limited ("SCS") and W H Ireland Limited ("WH Ireland"
and, together with SCS, the
"Joint
Brokers") are acting as joint
brokers in connection with the Proposals.
Use of proceeds of the
Fundraising
The net proceeds of the
Fundraising will be used for working capital purposes and, in
particular, the cost of the due diligence to be carried out on any
potential acquisitions to be made by EARNZ.
Transaction highlights
- The Placing will raise approximately £3.0
million (before expenses) through the issue of 39,954,644 Placing
Shares at 7.5 pence per Placing Share.
- The Subscription will raise approximately £0.7
million (before expenses) through the issue of 9,378,689
Subscription Shares at 7.5 pence per Subscription
Share.
- The Issue Price of 7.5 pence per New Ordinary
Share is equivalent to the closing middle market price of 0.075
pence per Existing Share on 15 March 2024, being the latest
practicable date prior to the date of this
Announcement.
- The Placing and Subscription
Shares (together the "Fundraising
Shares") will represent
approximately 78 per cent. of the issued share capital of EARNZ
immediately following the Consolidation but prior to the issue of
the Fundraising Shares (the "Existing Consolidated
Shares").
- The effect of the Consolidation
will be that shareholders ("Shareholders")
holding Existing Ordinary Shares on EARNZ's register of members at
6.00 p.m. on 4 April 2024 (the "Record
Date") will, on
implementation of the Consolidation, hold:
-
- 1
Consolidated Share for every 100 Existing Shares held on the Record
Date
- The Consolidation is
expected to increase EARNZ's share price proportionately, help
improve the market liquidity of, and trading activity in, EARNZ's
shares, provide the basis for a narrowing in the spread of its bid
and offer share price and enhance the perception of EARNZ and its
prospects and help improve the marketability of EARNZ's shares to a
wider group of investors.
- The Consolidation will reduce the 954,649,500
Existing Shares in issue (as at the Record Date) to 9,546,495
Consolidated Shares, after the issue of the Additional Shares (as
defined below) to ensure the Existing Shares can be precisely
divisible by 100.
The Consolidation and
the Fundraising are conditional upon, among other things, the
resolutions (the "Resolutions")
required to implement the Proposals being duly passed by
Shareholders at the general meeting proposed to be held at 10.00
a.m. on 4 April 2024 (the "General
Meeting"). The Fundraising is
not being underwritten.
Bob Holt, Executive Chairman of EARNZ,
said:
"We are
pleased by the response received from investors and look forward to
putting the funds raised to good use in seeking suitable
acquisitions in the energy services sector."
This Announcement should be read in its
entirety. In particular, you should read and understand the
information provided in the "Important Notices" section
below.
Enquiries:
EARNZ plc
|
+44 (0) 7778 798
816
|
Bob Holt
John Charlton
|
|
Shore Capital -
Nominated Adviser and Joint Broker
|
+44 (0) 20 7408
4090
|
Tom Griffiths / Lucy Bowden
|
|
WH Ireland Limited - Joint
Broker
|
+44 (0) 20 7220
1666
|
Hugh Morgan / Antonio
Bossi / Andrew de Andrade
|
|
The following is an
extract from the Chairman's letter to be set out in substantially
the same form in the Circular. The Circular is expected to be
despatched to Shareholders later today and, once published, will be
available on EARNZ's website at
www.earnzplc.com.
1.
Introduction
On 28 February 2024,
the Company announced that it had entered into a conditional sale
and purchase agreement to dispose of its solar business including
the whole of the issued share capital of Verditek Solar srl to
Verditek Solar Limited, a newly incorporated company owned and
incorporated by the Company's then bondholders. The
consideration for this sale was £528,340 which was satisfied by the
surrender of all of the Company's secured convertible loan notes
plus accrued interest to completion of the sale. In addition, the
Company announced my loan to the Company of £300,000 to provide
working capital, the proposed placing of 400 million new Ordinary
Shares at 0.075 pence per Ordinary Share to raise £300,000
(the "Original
Placing") and the appointment
of John Charlton and myself as executive director and executive
chair of the Company respectively.
Following a general
meeting held on 28 February 2024, completion of the above sale
occurred on 29 February 2024. From 1 March 2024, the Company has
been regarded as an AIM Rule 15 cash shell further details of which
are set out below. EARNZ has stated it is seeking acquisition
targets in the energy services sector. On 5 March 2024, the
Existing Shares issued pursuant to the Original Placing were
admitted to trading on AIM. On 6 March 2024, the Company
changed its name to EARNZ plc and, on 13 March 2024, it announced
the appointment of Elizabeth Lake as a non-executive director of
the Company.
The Company's
announcement of 28 February 2024 also stated that, subject to
approval from Shareholders, it intended to undertake the
Consolidation and raise approximately £1.5 million which has
subsequently been increased to £3.7 million. The proceeds of
the Original Placing of £300,000 on 29 February 2024 together with
the proceeds of the Placing and the Subscription means that the
Company has, subject to Admission, now raised a total of £4.0
million from new Shareholders since its new management was brought
in.
The purpose of this
document is, amongst other things, to convene the General Meeting,
set out the background to and reasons for the Consolidation, the
Placing, the Subscription and the Loan Conversion and explain why
the Directors consider that the Proposals are in the best interests
of the Shareholders as a
whole.
2. AIM Rule 15 cash
shell status
As
previously announced, since 1 March 2024, the Company has been
regarded as an AIM Rule 15 cash shell for the purposes of the AIM
Rules, having ceased to own, control, or conduct all or
substantially all, of its existing trading business, activities, or
assets. The Company will therefore, within 6 months need to make an
acquisition or acquisitions which constitute a reverse takeover
under AIM Rule 14, failing which trading in the Company's shares on
AIM will be suspended. Should the Company's shares remain suspended
from trading for 6 months, admission of the Company's shares to
trading on AIM will be cancelled under AIM Rule 41.
3.
Consolidation
3.1.
Background to and reasons for the Consolidation
The Directors believe
that the Company's existing share capital structure is no longer
appropriate. The high number of Ordinary Shares in issue combined
with the current relatively low price per Ordinary Share is thought
to result in excess volatility, reduced liquidity and a widening in
the market bid and offer share price spread for the Existing
Shares. We are therefore proposing to consolidate the Company's
issued ordinary shares of 0.04 pence each so that every 100
Existing Shares will be consolidated into 1 ordinary share of 4
pence. To ensure the Existing Shares can be exactly divisible by
100, the Company will issue the Additional Shares. The
Consolidation will reduce the 954,649,500 Ordinary Shares expected
to be in issue as at the Record Date following the issue of the
Additional Shares to 9,546,495 New Ordinary Shares.
As all of the Existing
Shares are proposed to be consolidated, the proportion of
Consolidated Shares held by each Shareholder immediately before and
immediately after the Record Date will, save for Fractional
Entitlements (as described below), remain unchanged.
The Consolidation is
expected to:
- increase the Company's
share price proportionately;
- help improve the
market liquidity of, and trading activity in, the Company's
shares;
- provide the basis for
a narrowing in the spread of its bid and offer share price;
and
- enhance
the perception of the Company and its prospects and help improve
the marketability of the Company's shares to a wider group of
investors.
The Consolidation
requires the approval of Shareholders by way of an ordinary
resolution which will be sought at the General Meeting by way of
Resolution 1 as set out in the Notice.
3.2. Summary terms of the
Consolidation
At the General
Meeting, the Directors are inviting Shareholders to approve the
Consolidation pursuant to which every 100 Existing Shares will be
consolidated into 1 Consolidated Share.
Subject to Resolution
1 (as set out in the Notice) being passed by the Shareholders at
the General Meeting, the Company will, immediately prior to the
Record Date, issue additional Ordinary Shares so that the total
number of Existing Shares in issue at the Record Date is exactly
divisible by 100. Assuming no other Ordinary Shares are issued by
the Company between the date of this document and the Record Date,
this will result in 83 Ordinary Shares being issued to the
Registrars and will result in 954,649,500 Existing Shares. The
nominal value of the Consolidated Shares following the
Consolidation will be 4 pence each per Consolidated
Share.
Since the Additional
Shares will only represent a fraction of a Consolidated Share, this
fraction will be combined with other Fractional Entitlements and
sold pursuant to the arrangements for Fractional Entitlements
detailed at paragraph 3.3 below.
As all of the Existing
Shares are proposed to be consolidated, the proportion of issued
ordinary shareholdings in the Company held by each Shareholder
immediately before and immediately after the Consolidation will,
save for Fractional Entitlements, remain unchanged.
3.3. Fractional
Entitlements
The Consolidation will
result in Fractional Entitlements to a Consolidated Share where any
shareholding is not exactly divisible by 100. No Shareholder will
be entitled to a fraction of a Consolidated Share. Instead, their
entitlement will be rounded down to the nearest whole number of
Consolidated Shares. If a Shareholder holds fewer than 100 Existing
Shares at the Record Date, the rounding down process of the
Consolidation will result in that Shareholder being entitled to no
Consolidated Shares and they will cease to be a
Shareholder.
Any Shareholder who,
as a result of the Consolidation, has a Fractional Entitlement to
any Consolidated Shares, will not have a proportionate holding of
Consolidated Shares exactly equal to their proportionate holding of
Existing Shares. No certificates will be issued for Fractional
Entitlements to Consolidated Shares.
All Fractional
Entitlements will be aggregated and sold on behalf, and for the
benefit, of the Company in the market for the best price reasonably
obtainable. Under the Articles, the Directors have a discretion as
to how to deal with fractional entitlements, including by
accounting to Shareholders for the net proceeds of any sale. The
maximum fractional entitlement that any Shareholder would be
entitled to would be worth less than 4 pence. The Board is of the
view that, as a result of the disproportionate costs, it would not
be in the best interests of the Company to distribute such proceeds
of sale, which instead shall be retained for the benefit of the
Company in accordance with the Articles.
For the avoidance of
doubt, the Company is only responsible for dealing with fractions
arising on registered holdings. For Shareholders whose shares are
held in the nominee accounts of UK stockbrokers, the effect of the
Consolidation on their individual shareholdings will be
administered by the stockbroker or nominee in whose account the
relevant shares are held. The effect is expected to be the same as
for shareholdings registered in beneficial names, however, it is
the responsibility of the stockbroker or nominee to deal with
fractions arising within their customer accounts, and not the
responsibility of the Company.
3.4. Resulting share capital and
Consolidated Shares
If approved by the
Shareholders, the issued share capital of the Company immediately
following the Consolidation is expected to comprise 9,546,495
Consolidated Shares. The Consolidated Shares shall have the same
rights as the Existing Shares including in respect of voting,
dividends, returns of capital and other rights.
Application will be
made to the London Stock Exchange for the Consolidated Shares to be
admitted to trading on AIM in place of the Existing Shares. Subject
to the Consolidation Resolution being passed, dealings in the
Existing Shares will cease on the Record Date and it is expected
that Admission will become effective, and that dealings in the
Consolidated Shares will commence, at 8.00a.m. on 8 April
2024.
4. Placing of New
Ordinary Shares
The Company
has conditionally raised approximately £3.0 million of cash (before
expenses) by means of the placing of 39,954,644 New Ordinary Shares
at 7.5 pence per New Ordinary Share. The Issue Price of 7.5 pence
per New Ordinary Share is equivalent to the closing middle market
price of 0.075 pence per Existing Share on 15 March 2024, being the
latest practicable date prior to the date of this
document.
The Placing is
conditional upon, inter
alia, the passing of the
Resolutions to be put to Shareholders at the General Meeting,
receipt by EARNZ of the cleared funds from the subscribers for
Subscription Shares on the day of the General Meeting, the Placing
Agreement becoming unconditional in respect of the Placing Shares
and not being terminated in accordance with its terms and Admission
occurring by no later than 8.00 a.m. on 8 April 2024 (or such later
date as the Company and Shore Capital and WH Ireland may agree,
being no later than 8.00 a.m. on 22 April 2024).
The net proceeds of
the Placing will be used for working capital purposes and, in
particular, the cost of the due diligence to be carried out on any
potential acquisitions to be made by the Company.
If the Proposals
complete on the basis set out in this document, the Placing Shares
will represent approximately 64 per cent. of the Company's issued
share capital immediately following Admission and existing
Shareholders will hold approximately 15 per cent. of the Company's
issued share capital immediately following Admission.
The Placing Agreement
Pursuant to the terms
of the Placing Agreement, Shore Capital and WH Ireland, as agents
for the Company, have conditionally agreed to use their reasonable
endeavours to procure subscribers for the Placing Shares. The
Placing has not been underwritten.
The Placing Agreement
contains normal warranties (in relation to, inter alia, the
accuracy of the information in this document and other matters
relating to the Company, its subsidiaries, and its business) and
indemnities given by the Company to Shore Capital and WH Ireland as
well as market standard rights of termination. The Company
will pay Shore Capital and WH Ireland commissions in respect of
those Placing Shares placed by them.
5. Subscription for New
Ordinary Shares
The Company has
conditionally raised approximately £0.7 million (before expenses)
of cash by means of the subscription for 9,378,689 New Ordinary
Shares at 7.5 pence per share. The Issue Price of 7.5 pence per New
Ordinary Share is equivalent to the closing middle market price of
0.075 pence per Existing Share on 15 March 2024, being the latest
practicable date prior to the date of this document. Bob Holt has
agreed to subscribe approximately £50,000 for 666,666 Subscription
Shares as part of the Subscription and his wife has agreed to
subscribe £10,000 for 133,333 Subscription Shares as part of the
Subscription.
The Subscription is
conditional upon, inter alia, the passing of the Resolutions to be
put to Shareholders at the General Meeting, the Placing Agreement
becoming unconditional in respect of the Placing Shares and not
being terminated in accordance with its terms and Admission
occurring by no later than 8.00 a.m. on 8 April 2024 (or such later
date as the Company and Shore Capital may agree, being no later
than 8.00 a.m. on 22 April 2024).
Like the net proceeds
of the Placing, the net proceeds of the Subscription will be used
for working capital purposes and, in particular, the cost of the
due diligence to be carried out on any potential acquisitions to be
made by the Company.
If the Proposals
complete on the basis set out in this document, the Subscription
Shares will represent approximately 15 per cent. of the Company's
issued share capital immediately following Admission.
6. Loan
Conversion
As announced by the
Company on 28 February 2024, Bob Holt entered into a loan agreement
with the Company prior to his appointment as a director of the
Company pursuant to which Bob Holt agreed to advance up to £300,000
to the Company, to satisfy certain outstanding liabilities of the
Company and to provide working capital. The full amount of
this loan has now been advanced to the Company.
This loan is unsecured
and interest free but repayable upon demand and, in accordance with
its terms, it is convertible at Admission into New Ordinary Shares
at a price equivalent to the Issue Price, conditional upon
Admission. As a result of the Loan Conversion, the Company
will issue 4,000,000 New Ordinary Shares to Bob Holt, which will
represent approximately 6 per cent. of the Company's issued share
capital immediately following Admission.
7. Settlement and
trading
Application will be
made to the London Stock Exchange for the New Shares to be admitted
to trading on AIM.
Subject to the
Resolutions being passed, it is expected that Admission will become
effective, and that dealings in the New Shares will commence, at
8.00 a.m. on 8 April 2024.
The New Shares will,
on Admission, rank pari passu
in all respects with the New Shares
and will rank in full for all dividends and other distributions
declared, made or paid on New Ordinary Shares after
Admission.
8. Related party
transactions
Ray Horney has agreed
to subscribe for 1,333,333 Placing Shares. As at 15 March 2024,
being the latest practicable date prior to the date of this
document, so far as the Company is aware, Ray Horney holds
133,333,333 Existing Shares representing approximately 13.97 per
cent. of the Existing Shares. As such, Ray Horney is a substantial
shareholder of the Company and his participation in the Placing is
a related party transaction pursuant to AIM Rule 13. The Directors
consider, having consulted with the Company's nominated adviser,
Shore Capital and Corporate, that the terms of Ray Horney's
participation in the Placing are fair and reasonable insofar as the
Shareholders are concerned.
Catherine Charlton,
the wife of John Charlton, a Director, has agreed to subscribe for
133,333 Subscription Shares, which is a related party transaction
pursuant to AIM Rule 13. Bob Holt and Elizabeth Lake, being
independent Directors in relation to this transaction, consider,
having consulted with the Company's nominated adviser, Shore
Capital and Corporate, that the terms of Catherine Charlton's
participation in the Subscription are fair and reasonable insofar
as the Shareholders are concerned.
As a Director, Bob
Holt and his wife's participation in the Subscription which, in
aggregate, amounts to 799,999 Subscription Shares is a related
party transaction pursuant to AIM Rule 13. John Charlton and
Elizabeth Lake, being independent Directors in relation to this
transaction, consider, having consulted with the Company's
nominated adviser, Shore Capital and Corporate, that the terms of
Bob Holt and his wife's participation in the Subscription are fair
and reasonable insofar as the Shareholders are
concerned.
9. Non-United Kingdom
Shareholders
The distribution of
this document and/or the Form of Proxy in certain jurisdictions may
be restricted by law. Persons into whose possession these documents
come should inform themselves about and observe any such
restrictions. Any failure to comply with these restrictions may
constitute a violation of the securities laws of any such
jurisdiction.
The New Shares have
not been, nor will they be, registered under the United States
Securities Act of 1933, as amended, (the "US Securities
Act") and may not be offered,
sold or delivered in, into or from the United States except
pursuant to an exemption from, or in a transaction not subject to,
the registration requirements of the US Securities Act.
Subject to certain exemptions, this document does not constitute an
offer of New Shares to any person with a registered address, or who
is resident in, the United States. There will be no public
offer in the United States. Outside of the United States, the
New Shares are being offered in reliance on Regulation S under the
US Securities Act. The New Shares will not qualify for
distribution under the relevant securities laws of Australia,
Canada, the Republic of Ireland, the Republic of South Africa or
Japan, nor has any prospectus in relation to the New Shares been
lodged with, or registered by, the Australian Securities and
Investments Commission or the Japanese Ministry of Finance.
Accordingly, subject to certain exemptions, the New Shares may not
be offered, sold, taken up, delivered or transferred in, into or
from the United States, Australia, Canada, the Republic of Ireland,
the Republic of South Africa, Japan or any other jurisdiction where
to do so would constitute a breach of local securities laws or
regulations (each a "Restricted
Jurisdiction") or to or for
the account or benefit of any national, resident or citizen of a
Restricted Jurisdiction. This document does not constitute an
offer to issue or sell, or the solicitation of an offer to
subscribe for or purchase, any New Shares to any person in a
Restricted Jurisdiction and is not for distribution in, into or
from a Restricted Jurisdiction.
The New Shares have
not been approved or disapproved by the US Securities and Exchange
Commission, or any other securities commission or regulatory
authority of the United States, nor have any of the foregoing
authorities passed upon or endorsed the merits of the offering of
the New Shares nor have they approved this document or confirmed
the accuracy or adequacy of the information contained in this
document. Any representation to the contrary is a criminal
offence in the US.
Shareholders who are
not resident in the United Kingdom should note that they should
satisfy themselves that they have fully observed any applicable
legal requirements under the laws of their relevant jurisdiction in
relation to the Proposals.
The person responsible
for arranging the release of this Announcement on behalf of EARNZ
is John Charlton, a director of EARNZ.
Issue Statistics
Number of Existing
Shares in issue at the date of this Announcement
|
954,649,417
|
Number of Existing
Shares expected to be in issue immediately prior to the Record
Date
|
954,649,500
|
|
|
Conversion ratio of
Existing Shares
|
1 Consolidated Share: 100 Existing
Shares
|
|
|
Number of Consolidated
Shares expected to be in issue following the
Consolidation
|
9,546,495
|
|
|
Nominal value per
Existing Share prior to the Consolidation
|
0.04 pence
|
|
|
Nominal value per
Consolidated Share following the Consolidation
|
4.0 pence
|
|
|
Number of Placing
Shares to be issued at the Issue Price
|
39,954,644
|
|
|
Number of Subscription
Shares to be issued at the Issue Price
|
9,378,689
|
|
|
Number of Loan Shares
to be issued at the Issue Price
|
4,000,000
|
|
|
Issue Price
|
0.075 pence per Ordinary Share
(7.5 pence per New Ordinary Share)
|
|
|
Total number of New
Ordinary Shares in issue immediately following
Admission
|
62,879,828
|
|
|
Gross proceeds of the
Placing
|
£3.0 million
|
|
|
Gross proceeds of the
Subscription
|
£0.7 million
|
|
|
Estimated net proceeds
of the Placing and the Subscription receivable by the
Company
|
£3.45 million
|
|
|
ISIN for the
Consolidated Shares
|
GB00BRC2TB67
|
|
|
SEDOL for the
Consolidated Shares
|
BRC2TB6
|
Expected Timetable of Events
Publication and
posting of the Circular
|
18 March
2024
|
Latest time and date
for receipt of completed Forms of Proxy and CREST voting
instructions
|
10.00 a.m. on 2 April
2024
|
General
Meeting
|
10.00 a.m. on 4 April
2024
|
Record Date for the
Consolidation
|
6.00 p.m. on 4 April
2024
|
Admission of the
Consolidated Shares and the New Shares to trading on AIM expected
to become effective
|
8.00 a.m. on 8 April 2024
|
Expected date for
CREST accounts to be credited in respect of Consolidated Shares and
the New Shares in uncertificated form
|
8 April 2024
|
Expected date by which
certificates in respect of Consolidated Shares and the New Shares
are to be despatched to certificated Shareholders
|
within 10 business days of Admission
|
Notes:
1. All references to
time in this Announcement are to London time, unless specifically
stated otherwise, and are subject to change. Any such change
will be notified to Shareholders by an announcement through a
Regulatory Information Service.
2. Each of the times and
dates in the above timetable is subject to change. If any of the
above times and/or dates change, the revised times and dates will
be notified to Shareholders by an announcement through a Regulatory
Information Service.
3. All events listed in
the above timetable following the General Meeting are conditional
on the passing of the Resolutions at the General
Meeting.
IMPORTANT
NOTICES
Shore Capital
Stockbrokers Limited and Shore Capital and Corporate Limited are
authorised and regulated by the Financial Conduct Authority
(the "FCA") in the United Kingdom and are acting
exclusively for EARNZ and no one else in connection with the
Proposals, and SCS and SCC will not be responsible to anyone
(including any placees) other than EARNZ for providing the
protections afforded to its clients or for providing advice in
relation to the Proposals or any other matters referred to in this
Announcement.
WH Ireland Limited is
authorised and regulated by the FCA in the United Kingdom and is
acting exclusively for EARNZ and no one else in connection with the
Placing, and WH Ireland will not be responsible to anyone
(including any placees) other than EARNZ for providing the
protections afforded to its clients or for providing advice in
relation to the Placing or any other matters 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 the Joint Brokers or by any of their respective
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.
The responsibilities of
SCC as EARNZ's nominated adviser under the AIM Rules for Nominated
Advisers are owed solely to the London Stock Exchange and are not
owed to EARNZ or to any director of EARNZ or to any other
person.
This Announcement may
contain, or may be deemed to contain, "forward-looking statements"
with respect to certain of EARNZ's plans and its current goals and
expectations relating to its future financial condition,
performance, strategic initiatives, objectives and results.
Forward-looking statements sometimes use words such as "aim",
"anticipate", "target", "expect", "estimate", "intend", "plan",
"goal", "believe", "seek", "may", "could", "outlook" or other words
of similar meaning. By their nature, all forward-looking
statements involve risk and uncertainty because they relate to
future events and circumstances which are beyond the control of
EARNZ, including amongst other things, United Kingdom domestic and
global economic business conditions, market-related risks such as
fluctuations in interest rates and exchange rates, the policies and
actions of governmental and regulatory authorities, the effect of
competition, inflation, deflation, the timing effect and other
uncertainties of future acquisitions or combinations within
relevant industries, the effect of tax and other legislation and
other regulations in the jurisdictions in which EARNZ and its
affiliates operate, the effect of volatility in the equity, capital
and credit markets on EARNZ's profitability and ability to access
capital and credit, a decline in EARNZ's credit ratings; the effect
of operational risks; and the loss of key personnel. As a
result, the actual future financial condition, performance and
results of EARNZ may differ materially from the plans, goals and
expectations set forth in any forward-looking statements. Any
forward-looking statements made in this Announcement by or on
behalf of EARNZ speak only as of the date they are made.
Except as required by applicable law or regulation, EARNZ expressly
disclaims any obligation or undertaking to publish any updates or
revisions to any forward-looking statements contained in this
Announcement to reflect any changes in EARNZ's expectations with
regard thereto or any changes in events, conditions or
circumstances on which any such statement is based.
No statement in this
Announcement is intended to be a profit forecast or estimate, and
no statement in this Announcement should be interpreted to mean
that earnings per share of EARNZ for the current or future
financial years would necessarily match or exceed the historical
published earnings per share of EARNZ.
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; the relevant clearances have
not been, and will not be, obtained from the South Africa Reserve
Bank or any other applicable body in the Republic of South Africa
in relation to the Placing Shares; and the Placing Shares have not
been, nor will they be, registered under or offered in compliance
with the securities laws of any state, province or territory of the
United States, Australia, Canada, the Republic of South Africa or
Japan. Accordingly, the Placing Shares may not (unless an
exemption under the relevant securities laws is applicable) be
offered, sold, resold or delivered, directly or indirectly, in or
into the United States, Australia, Canada, the Republic of South
Africa or Japan or any other jurisdiction outside the United
Kingdom or the EEA.
Neither the content of
EARNZ's website nor any website accessible by hyperlinks on EARNZ's
website is incorporated in, or forms part of, this
Announcement.
Information to Distributors
UK product
governance
Solely for the purposes of the product
governance requirements contained within Chapter 3 of the FCA
Handbook Product Intervention and Product Governance Sourcebook
(the "UK Product Governance Requirements"), and disclaiming all and
any liability, whether arising in tort, contract or otherwise,
which any "manufacturer" (for the purposes of the UK Product
Governance Requirements) may otherwise have with respect thereto,
the Placing Shares have been subject to a product approval process,
which has determined that such securities are: (i) compatible with
an end target market of investors who meet the criteria of retail
investors and investors who meet the criteria of professional
clients and eligible counterparties, each as defined in paragraph 3
of the FCA Handbook Conduct of Business Sourcebook; and (ii)
eligible for distribution through all distribution channels (the
"Target Market Assessment"). Notwithstanding the Target
Market Assessment, distributors (for the purposes of UK Product
Governance Requirements) should note that: (a) the price of the
Placing Shares may decline and investors could lose all or part of
their investment; (b) the Placing Shares offer no guaranteed income
and no capital protection; and (c) an investment in the Placing
Shares is compatible only with investors who do not need a
guaranteed income or capital protection, who (either alone or in
conjunction with an appropriate financial or other adviser) are
capable of evaluating the merits and risks of such an investment
and who have sufficient resources to be able to bear any losses
that may result therefrom. The Target Market Assessment is
without prejudice to the requirements of any contractual, legal or
regulatory selling restrictions in relation to the Placing.
Furthermore, it is noted that, notwithstanding the Target Market
Assessment, the Joint Brokers will only procure investors who meet
the criteria of professional clients and eligible
counterparties.
For the avoidance of doubt, the Target Market
Assessment does not constitute: (a) an assessment of suitability or
appropriateness for the purposes of Chapter 9A or 10A respectively
of the FCA Handbook Conduct of Business Sourcebook; or (b) a
recommendation to any investor or group of investors to invest in,
or purchase, or take any other action whatsoever with respect to
the Placing Shares.
Each distributor is responsible for undertaking
its own target market assessment in respect of the Placing Shares
and determining appropriate distribution
channels.
EEA product
governance
Solely for the purposes of the product
governance requirements contained within: (a) EU Directive
2014/65/EU on markets in financial instruments, as amended ("MiFID
II"); (b) Articles 9 and 10 of Commission Delegated Directive (EU)
2017/593 supplementing MiFID II; and (c) local implementing
measures in the European Economic Area (together, the "MiFID II
Product Governance Requirements"), and disclaiming all and any
liability, whether arising in tort, contract or otherwise, which
any "manufacturer" (for the purposes of the MiFID II Product
Governance Requirements) may otherwise have with respect thereto,
the Placing Shares have been subject to a product approval process,
which has determined that the Placing Shares are: (i) compatible
with an end target market of (a) retail investors, (b) investors
who meet the criteria of professional clients and (c) eligible
counterparties, each as defined in MiFID II; and (ii) eligible for
distribution through all distribution channels as are permitted by
MiFID II (the "EU Target Market Assessment"). Notwithstanding
the EU Target Market Assessment, distributors should note that: the
price of the Placing Shares may decline and investors could lose
all or part of their investment; the Placing Shares offer no
guaranteed income and no capital protection; and an investment in
the Placing Shares is compatible only with investors who do not
need a guaranteed income or capital protection, who (either alone
or in conjunction with an appropriate financial or other adviser)
are capable of evaluating the merits and risks of such an
investment and who have sufficient resources to be able to bear any
losses that may result therefrom. The Target Market
Assessment is without prejudice to the requirements of any
contractual, legal or regulatory selling restrictions in relation
to the Placing. Furthermore, it is noted that,
notwithstanding the EU Target Market Assessment, the Joint Brokers
will only procure investors who meet the criteria of professional
clients and eligible counterparties.
For the avoidance of doubt, the EU Target Market
Assessment does not constitute: (a) an assessment of suitability or
appropriateness for the purposes of MiFID II; or (b) a
recommendation to any investor or group of investors to invest in,
or purchase, or take any other action whatsoever with respect to
the Placing Shares.
Each distributor is responsible for undertaking
its own target market assessment in respect of the Placing Shares
and determining appropriate distribution
channels.
DEFINITIONS
The following
definitions apply throughout this Announcement unless the context
otherwise requires:
Additional
Shares
|
the 83 additional
Ordinary Shares to be issued immediately prior to the Record Date
so that the total number of Existing Shares in issue shall be
exactly divisible by 100;
|
|
|
Admission
|
the admission of the
Consolidated Shares and the New Shares to trading on AIM becoming
effective in accordance with Rule 6 of the AIM Rules, expected to
be at 8.00a.m. on 8 April 2024;
|
|
|
AIM
Rules
|
the AIM Rules for
Companies published by the London Stock Exchange (as amended from
time to time);
|
Articles
|
the Company's articles
of association;
|
Board or Directors
|
the board of directors
of the Company;
|
Company
|
EARNZ plc (incorporated
and registered in England and Wales with company number 10114644),
whose registered office is at Holborn Gate, 330 Holborn, London,
England, WC1V 7QT;
|
Consolidated
Shares
|
ordinary shares of 4
pence each in the capital of the Company following the completion
of the Consolidation;
|
|
|
Consolidation
|
the proposed
consolidation of every 100 Existing Share into 1 Consolidated
Share;
|
|
|
Consolidation
Resolution
|
Resolution 1 to be
proposed to the Shareholders at the General Meeting to approve the
Consolidation;
|
|
|
CREST
|
the computerised
settlement system (as defined in the CREST Regulations) operated by
Euroclear UK & International Limited which facilitates the
transfer of title to share in uncertificated form;
|
Existing
Shares
|
the fully paid ordinary
shares of 0.04 pence each in the capital of the Company prior to
the Record Date;
|
|
|
FCA
|
the UK Financial
Conduct Authority;
|
|
|
Form of
Proxy
|
the form of proxy
accompanying this document for use at the General
Meeting;
|
|
|
Fractional
Entitlement
|
a fractional
entitlement to a Consolidated Share arising on the
Consolidation;
|
|
|
FSMA
|
the Financial Services
and Markets Act 2000 (as amended);
|
|
|
General Meeting
|
the general meeting of
the Company to be held at the offices of Shore Capital, Cassini
House, 57 St James's Street, London SW1A 1LD at 10.00 a.m. on 4
April 2024;
|
Issue
Price
|
7.5 pence per New
Share;
|
Loan
Conversion
|
the conversion of Bob
Holt's loan of £300,000 to the Company into the Loan Shares,
subject to Admission;
|
Loan
Shares
|
the 4,000,000 New
Ordinary Shares to be allotted to Bob Holt in respect of the Loan
Conversion;
|
London Stock
Exchange
|
London Stock Exchange
plc;
|
New Ordinary
Shares
|
new ordinary shares of
4 pence each in the capital of the Company (in issue after the
Consolidation);
|
New
Shares
|
together the Placing
Shares, the Subscription Shares and the Loan Shares;
|
|
|
Notice
|
the notice set out at
the end of this document convening the General Meeting;
|
|
|
Ordinary
Shares
|
the ordinary shares of
0.04 pence per share in the capital of the Company (in issue prior
to the Consolidation);
|
|
|
Placees
|
the persons who agree
conditionally to acquire the Placing Shares pursuant to the
Placing;
|
|
|
Placing
|
the proposed placing by
Shore Capital Stockbrokers and WH Ireland of the Placing
Shares;
|
|
|
Placing
Agreement
|
the conditional placing
agreement dated 18 March 2024 between (1) the Company, (2) Shore
Capital and Corporate, (3) Shore Capital Stockbrokers and (4) WH
Ireland setting out the terms and conditions of the
Placing;
|
|
|
Placing
Shares
|
39,954,644 New Ordinary
Shares to be allotted pursuant to the Placing;
|
Proposals
|
together the
Consolidation, the Placing, the Subscription and the Loan
Conversion;
|
|
|
Prospectus
Regulation Rules
|
the prospectus
regulation rules made by the FCA pursuant to section 73A of the
FSMA;
|
|
|
Record
Date
|
the record date for the
Consolidation, being 6.00 p.m. on 4 April 2024;
|
|
|
Resolutions
|
the resolutions to be
proposed at the General Meeting to approve the Consolidation and
the issue of the New Shares;
|
|
|
Shareholders
|
holders of ordinary
shares in the capital of the Company;
|
|
|
Shore
Capital
|
together, Shore Capital
and Corporate and Shore Capital Stockbrokers;
|
|
|
Shore Capital
and Corporate
|
Shore Capital and
Corporate Limited;
|
|
|
Shore Capital
Stockbrokers
|
Shore Capital
Stockbrokers Limited;
|
|
|
Subscription
|
the proposed
subscription by certain investors for the Subscription Shares at
the Issue Price;
|
|
|
Subscription
Shares
|
9,378,689 New Ordinary
Shares to be allotted pursuant to the Subscription; and
|
|
|
WH
Ireland
|
W H Ireland
Limited.
|