Published: 31 July 2019
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, CANADA, JAPAN, THE REPUBLIC OF SOUTH AFRICA, AUSTRALIA, NEW ZEALAND OR ANY OTHER JURISDICTION WHERE TO DO SO WOULD CONSTITUTE A VIOLATION OF THE RELEVANT LAWS OR REGULATIONS OF THAT JURISDICTION.
THIS ANNOUNCEMENT IS FOR INFORMATION PURPOSES ONLY AND DOES NOT CONSTITUTE OR CONTAIN ANY INVITATION, SOLICITATION, RECOMMENDATION, OFFER OR ADVICE TO ANY PERSON TO SUBSCRIBE FOR, OTHERWISE ACQUIRE OR DISPOSE OF ANY SECURITIES IN IDOX 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 IDOX PLC.
THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION FOR THE PURPOSES OF ARTICLE 7 OF EU REGULATION 596/2014 ("MAR"). IN ADDITION, MARKET SOUNDINGS (AS DEFINED IN MAR) WERE TAKEN IN RESPECT OF CERTAIN OF THE MATTERS CONTAINED IN THIS ANNOUNCEMENT WITH THE RESULT THAT CERTAIN PERSONS BECAME AWARE OF SUCH INSIDE INFORMATION AS PERMITTED BY MAR. UPON THE PUBLICATION OF THIS ANNOUNCEMENT THIS INSIDE INFORMATION IS NOW CONSIDERED TO BE IN THE PUBLIC DOMAIN AND SUCH PERSONS SHALL THEREFORE CEASE TO BE IN POSSESSION OF INSIDE INFORMATION.
Idox plc
(“Idox”, “the Company” or “the Group”)
Proposed Acquisition of Tascomi Ltd
Proposed, associated Fundraising of £7.0 million via accelerated bookbuild
Idox plc (AIM: IDOX), a leading supplier of specialist information management solutions and services, is pleased to announce the proposed acquisition of Tascomi Limited (“Tascomi”) for up to £7.15m and its intention to undertake a placing via an accelerated bookbuild to raise net proceeds of c. £7.0 million at 28.5 pence per share (the "Placing Price") to fund the transaction.
Highlights
A further announcement will be made on the closing of the Placing, which is expected to occur later today.
Certain of the Directors of the Company have indicated their intention to subscribe for Placing Shares. Further details of the Placing and any participation by such Directors and their consequent interests, will be set out in the announcement to be made on the closing of the Placing which is expected later today.
David Meaden, CEO of Idox, commented:
“The addition of Tascomi’s technology platform to Idox’s deep domain knowledge and account management model will be a powerful combination that will allow us to deliver the next generation of software solutions to customers in our core public sector markets and drive enhanced shareholder value and service to customers.
This Acquisition offers a sound strategic fit as we look to enhance our overall cloud offering in conjunction with growing our SaaS revenue base. It will also build on the significant operational progress our Group has made in the last year, reshaping our Board and senior management team, and establishing sound business models to drive great value from the assets we have in our business”.
For further information please contact:
Idox plc +44 (0) 870 333 7101
Chris Stone, Non-Executive, Chairman
David Meaden, Chief Executive
Rob Grubb, Chief Financial Officer
N+1 Singer (NOMAD and Broker) +44 (0) 20 7496 3000
Shaun Dobson / Jen Boorer
Tom Salvesen (Corporate Broking)
This announcement should be read in its entirety. In particular, your attention is drawn to the detailed terms and conditions of the Placing and further information relating to the Placing and any participation in the Placing that is described in the Appendix to this Announcement (which forms part of this Announcement).
By choosing to participate in the Placing and by making an oral and legally binding offer to acquire Placing Shares, investors will be deemed to have read and understood this Announcement in its entirety (including the Appendix), and to be making such offer on the terms and subject to the conditions of the Placing contained herein, and to be providing the representations, warranties and acknowledgements contained in the Appendix.
About Idox plc
For more information see www.idoxplc.com @Idoxgroup
Additional information
Introduction
The Company has entered into an agreement to acquire Tascomi for consideration of £7.15m on a cash-free, debt-free basis, of which c. £5.43 million will be satisfied immediately in cash, c. £1.15m will be payable by the Company to extinguish all existing debt in Tascomi and with a further £0.57m which may be payable within seven months depending on settlement of various completion matters (the "Acquisition")
The Company also announces its intention to undertake the placing of up to 25,964,912 Placing Shares at a price of 28.5 pence per Placing Share to raise net proceeds of c. £7.0 million to fund the Acquisition. The Placing will be conducted by way of an ABB by N+1 Singer and will open immediately following the release of this Announcement. The Appendix to this Announcement contains the terms and conditions of the Placing. Should the balance of the consideration be payable in full, the excess consideration above the Placing proceeds will be met by the Groups existing resources and funding facilities.
Proposed acquisition of Tascomi
Tascomi currently serves 55 public sector customers across the UK and Ireland through a modern, proven, scalable cloud-enabled SaaS platform. The business has achieved strong new customer wins in the delivery of building control solutions and is becoming an emerging presence in delivering solutions that cater for Land and Property administration.
Tascomi has 33 staff and is based in Northern Ireland. It was established by Richard Martin, its current Managing Director, and supported by a number of senior staff establishing and delivering cloud-enabled SaaS technologies to customers. Mr Martin will be resigning his position and leaving the business following completion of the Acquisition, with the remaining Tascomi staff joining the enlarged Group.
In the year ended 31 March 2019, Tascomi generated revenue of approximately £1.9m (2018: £1.5m), delivering adjusted EBITDA of £0.7m (2018: £0.2m). These amounts are restated for Idox accounting policies. Current annual recurring revenue ("ARR") is £1.8m.
Background to and reasons for the Acquisition and Placing
In its interim results for the six months ended 30 April 2019 on 22 July 2019 the Company announced that it was continuing to explore ways to accelerate the Group's strategy and enhance its technological capabilities and market leading positions as well as build its recurring SaaS revenue profile.
During the past twelve months the Group has undergone significant transformation, including replacing five of the six Board members, and a number of senior management staff. This has involved establishing the relevant operational and financial disciplines necessary for a business of Idox's stature and complexity. The foundations that have now been embedded across the business leave Idox well positioned in the short term and will also support future progress against Idox's strategic objectives.
The future of the Idox business is in cloud provisioned software and related services. Strides have been made to accelerate a move into Software-as-a-Service (SaaS) product offerings and the Group has had success in both its Social Care and EIM businesses over the past six months. Part of the Group's strategy is to continue to accelerate its new 'cloud first' strategy, growing recurring income streams and future earnings visibility.
The Acquisition is expected to be earnings enhancing in the first full year of ownership, being the year ending 31 October 2020 ("FY20").
Terms of the Acquisition
The Company has entered into an agreement to acquire Tascomi for consideration of £7.15m on a cash-free, debt-free basis, of which c. £5.43 million will be satisfied immediately in cash, c. £1.15m will be payable by the Company to extinguish all existing debt in Tascomi and with a further £0.57m which may be payable within seven months depending on settlement of various completion matters (the "Acquisition").
The sellers have provided warranties and indemnities appropriate to a transaction of this nature. The Directors expect that the Acquisition will complete on 12 August 2019.
The CEO and existing owner of Tascomi Richard Martin will be stepping down from his role on completion and leaving the business. The existing Tascomi senior management team are committed to Tascomi and the Acquisition and will join Idox’s senior management team on completion.
Conditional Placing
The Company intends to fund the Acquisition by way of the Placing. The Company is proposing to raise approximately £7.4 million (before expenses) by way of a placing of 25,964,912 Placing Shares at the Placing Price with certain institutional and other investors.
The Placing will be conducted by N+1 Singer on behalf of the Company in accordance with the terms and conditions set out in the Appendix to this Announcement. The Placing is being conducted through an accelerated bookbuilding process (the "Bookbuild") which will commence immediately following this Announcement.
The Bookbuild will determine final demand for and participation in the Placing. The Bookbuild is expected to close not later than 5.30 p.m. (London) today, but may be closed at such earlier or later time as N+1 Singer, in its absolute discretion (following consultation with the Company), determines. The number of Placing Shares, the Placing Price and the making of allocations will be agreed between the Company and N+1 Singer and will be confirmed orally or by email by N+1 Singer following the closure of the Bookbuild. A further announcement will be made following the completion of the Bookbuild and pricing of the Placing.
The Placing (which is not being underwritten) is conditional, amongst other things, upon:
The Placing Shares, upon issue, will represent approximately 6 per cent. of the Enlarged Share Capital immediately following Admission. The Placing Shares will rank in full for all dividends with a record date on or after the date of Admission and otherwise equally with the Existing Ordinary Shares in issue from the date of Admission.
Idox has entered into a placing agreement (the "Placing Agreement") with N+1 Singer which acted as sole bookrunner in relation to the Placing. Further details of the Placing Agreement can be found in the terms and conditions of the Placing contained in the Appendix to this Announcement (which forms part of this Announcement).
In order to effect the Placing, the Company intends to utilise the authorities granted to it at its Annual General Meeting held on 29 March 2019 which enable it to issue up to (i) 20,770,847 new Ordinary Shares (representing approximately 5 per cent. of its issued share capital of the Company as at 5 March 2019) and (ii) a further 20,770,847 new Ordinary Shares (representing approximately 5 per cent. of its issued share capital of the Company as at 5 March 2019) in connection with a proposed acquisition in accordance with the Pre-Emption Group's statement of principles on a non pre-emptive basis.
Further information on the Placing and Admission is included in the section headed ‘Additional Information’ above. Attention is also drawn to the section headed 'Important Information' of this Announcement and the terms and conditions of the Placing (representing important information for Placees only) in the Appendix to this Announcement.
Capitalised terms used but not defined in this Announcement shall have the meanings given to such terms in the section headed 'Definitions' below save that any capitalised term defined in the Appendix shall have such meaning in the Appendix to the exclusion, in the Appendix only, of any definition of such term elsewhere in this Announcement.
Important Notice
N+1 Singer is acting as nominated adviser and broker and as agent for and on behalf of the Company for the Placing. N+1 Singer is authorised and regulated by the Financial Conduct Authority (the "FCA") in the United Kingdom. N+1 Singer is acting exclusively for the Company and no one else in connection with the Placing and N+1 Singer will not be responsible to anyone (including any Placees) other than the Company 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 N+1 Singer or by any of its affiliates or agents 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 therefore is expressly disclaimed.
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 the Company for the current or future financial years would necessarily match or exceed the historical published earnings per share of the Company.
The price of shares and any income expected from them may go down as well as up and investors may not get back the full amount invested upon disposal of the shares. Past performance is no guide to future performance, and persons needing advice should consult an independent financial adviser.
The Placing Shares to be issued pursuant to the Placing will not be admitted to trading on any stock exchange other than on the AIM market of the London Stock Exchange.
Neither the content of the Company's website nor any website accessible by hyperlinks on the Company's website is incorporated in, or forms part of, this Announcement.
This Announcement may contain and the Company may make verbal statements containing "forward-looking statements" with respect to certain of the Company'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 the Company, 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 the Company and its respective affiliates operate, the effect of volatility in the equity, capital and credit markets on the Company's profitability and ability to access capital and credit, a decline in the Company'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 the Company 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 the Company speak only as of the date they are made. Except as required by applicable law or regulation, the Company 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 the Company's expectations with regard thereto or any changes in events, conditions or circumstances on which any such statement is based.
This Announcement does not constitute, or form part of, a prospectus relating to the Company, nor does it constitute or contain any invitation or offer to any person, or any public offer, to subscribe for, purchase or otherwise acquire any shares in the Company or advise persons to do so in any jurisdiction, nor shall it, or any part of it (other than the Appendix in relation to Placees) form the basis of or be relied on in connection with any contract or as an inducement to enter into any contract or commitment with the Company. In particular, the Placing Shares have not been, and will not be, registered under the United States Securities Act of 1933 as amended or qualified for sale under the laws of any state of the United States or under the applicable laws of any of Canada, Australia, the Republic of South Africa, or Japan and, subject to certain exceptions, may not be offered or sold in the United States or to, or for the account or benefit of, US persons (as such term is defined in Regulation S under the Securities Act) or to any national, resident or citizen of Canada, Australia, the Republic of South Africa or Japan.
The distribution or transmission of this Announcement and the offering of the Placing Shares in certain jurisdictions may be restricted or prohibited by law or regulation. Persons distributing this Announcement must satisfy themselves that it is lawful to do so. Any failure to comply with these restrictions may constitute a violation of the securities laws of any such jurisdiction. No action has been taken by the Company or N+1 Singer that would permit an offering of such shares or possession or distribution of this Announcement or any other offering or publicity material relating to such shares in any jurisdiction where action for that purpose is required. Persons into whose possession this Announcement comes are required by the Company and N+1 Singer to inform themselves about, and to observe, such restrictions. In particular, this announcement may not be distributed, directly or indirectly, in or into the United States, Canada, the Republic of South Africa, Australia or Japan. Overseas shareholders and any person (including, without limitation, nominees and trustees), who have a contractual or other legal obligation to forward this document to a jurisdiction outside the UK should seek appropriate advice before taking any action.
APPENDIX - TERMS AND CONDITIONS OF THE PLACING
IMPORTANT INFORMATION FOR INVITED PLACEES ONLY REGARDING THE PLACING.
THIS ANNOUNCEMENT, INCLUDING THIS APPENDIX AND THE INFORMATION CONTAINED HEREIN (TOGETHER THE "ANNOUNCEMENT") IS RESTRICTED AND IS NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, IN WHOLE OR IN PART, DIRECTLY OR INDIRECTLY, IN OR INTO OR FROM THE UNITED STATES, AUSTRALIA, CANADA, JAPAN, THE REPUBLIC OF SOUTH AFRICA OR ANY OTHER JURISDICTION IN WHICH SUCH RELEASE, PUBLICATION OR DISTRIBUTION WOULD BE UNLAWFUL. THIS ANNOUNCEMENT HAS NOT BEEN APPROVED BY THE LONDON STOCK EXCHANGE, NOR IS IT INTENDED THAT IT WILL BE SO APPROVED.
MEMBERS OF THE PUBLIC ARE NOT ELIGIBLE TO TAKE PART IN THE PLACING. THIS ANNOUNCEMENT IS FOR INFORMATION PURPOSES ONLY AND IS DIRECTED ONLY AT: (A) PERSONS IN MEMBER STATES OF THE EUROPEAN ECONOMIC AREA ("EEA") 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 DIRECTIVE 2003/71/EC AS AMENDED, INCLUDING BY THE 2010 PROSPECTUS DIRECTIVE AMENDING DIRECTIVE (DIRECTIVE 2010/73/EC) AND TO THE EXTENT IMPLEMENTED IN THE RELEVANT MEMBER STATE (THE "PROSPECTUS DIRECTIVE"); AND (B) IN THE UNITED KINGDOM, QUALIFIED INVESTORS WHO ARE PERSONS WHO (I) HAVE PROFESSIONAL EXPERIENCE IN MATTERS RELATING TO INVESTMENTS FALLING WITHIN ARTICLE 19(5) (INVESTMENT PROFESSIONALS) OF THE FINANCIAL SERVICES AND MARKETS ACT 2000 (FINANCIAL PROMOTION) ORDER 2005, AS AMENDED (THE "ORDER"); (II) ARE PERSONS FALLING 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 ANNOUNCEMENT AND THE INFORMATION IN IT MUST NOT BE ACTED ON OR RELIED ON BY PERSONS WHO ARE NOT RELEVANT PERSONS. PERSONS DISTRIBUTING THIS ANNOUNCEMENT MUST SATISFY THEMSELVES THAT IT IS LAWFUL TO DO SO. ANY INVESTMENT OR INVESTMENT ACTIVITY TO WHICH THIS ANNOUNCEMENT RELATES IS AVAILABLE ONLY TO RELEVANT PERSONS AND WILL BE ENGAGED IN ONLY WITH RELEVANT PERSONS. THIS ANNOUNCEMENT DOES NOT ITSELF CONSTITUTE AN OFFER FOR SALE OR SUBSCRIPTION OF ANY SECURITIES IN IDOX PLC.
THIS ANNOUNCEMENT IS NOT AN OFFER OF SECURITIES FOR SALE INTO THE UNITED STATES. THE PLACING SHARES HAVE NOT BEEN AND WILL NOT BE REGISTERED UNDER THE UNITED STATES SECURITIES ACT 1933, AS AMENDED (THE "SECURITIES ACT") OR WITH ANY SECURITIES REGULATORY AUTHORITY OF ANY STATE OR JURISDICTION OF THE UNITED STATES, AND MAY NOT BE OFFERED, SOLD OR TRANSFERRED, DIRECTLY OR INDIRECTLY, IN THE UNITED STATES EXCEPT PURSUANT TO AN EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND IN COMPLIANCE WITH ANY APPLICABLE SECURITIES LAWS OF ANY STATE OR OTHER JURISDICTION OF THE UNITED STATES. SUBJECT TO CERTAIN EXCEPTIONS AND AT THE SOLE DISCRETION OF THE COMPANY, THE PLACING SHARES ARE BEING OFFERED AND SOLD ONLY OUTSIDE THE UNITED STATES IN "OFFSHORE TRANSACTIONS" WITHIN THE MEANING OF, AND IN ACCORDANCE WITH, REGULATION S UNDER THE SECURITIES ACT AND OTHERWISE IN ACCORDANCE WITH APPLICABLE LAWS. NO PUBLIC OFFERING OF THE PLACING SHARES IS BEING MADE IN THE UNITED STATES, THE UNITED KINGDOM OR ELSEWHERE. 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 ADVISERS AS TO LEGAL, TAX, BUSINESS AND RELATED ASPECTS OF AN INVESTMENT IN PLACING SHARES. THE DISTRIBUTION OF THIS ANNOUNCEMENT, ANY PART OF IT OR ANY INFORMATION CONTAINED IN IT MAY BE RESTRICTED BY LAW IN CERTAIN JURISDICTIONS, AND ANY PERSON INTO WHOSE POSSESSION THIS ANNOUNCEMENT, ANY PART OF IT OR ANY INFORMATION CONTAINED IN IT COMES SHOULD INFORM THEMSELVES ABOUT, AND OBSERVE, SUCH RESTRICTIONS.
No action has been taken by the Company, N+1 Singer Advisory LLP ("N+1 Singer") or any of their respective affiliates, agents, directors, officers or employees that would permit an offer of the Placing Shares or possession or distribution of this Announcement or any other offering or publicity material relating to such Placing Shares in any jurisdiction where action for that purpose is required.
This Announcement or any part of it does not constitute or form part of any offer to issue or sell, or the solicitation of an offer to acquire, purchase or subscribe for, any securities in the United States (including its territories and possessions, any state of the United States and the District of Columbia), Canada, Australia, the Republic of South Africa, Japan or any other jurisdiction in which the same would be unlawful. No public offering of the Placing Shares is being made in any such jurisdiction.
All offers of the Placing Shares will be made pursuant to an exemption under the Prospectus Directive from the requirement to produce a prospectus. In the United Kingdom, this Announcement is being directed solely at persons in circumstances in which section 21(1) of the Financial Services and Markets Act 2000 (as amended) (the "FSMA") does not apply.
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 for 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 offering 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 right or other legal obligations to forward a copy of this Announcement should seek appropriate advice before taking any action.
This Announcement should be read in its entirety. In particular, you should read and understand the information provided in this "Important Information" section of this Announcement.
By participating in the Placing, each person who is invited to and who chooses to participate in the Placing (and any person acting on such person’s behalf) (a "Placee") will be deemed to have read and understood this Announcement in its entirety, to be participating, making an offer and acquiring Placing Shares on the terms and conditions contained herein and to be providing the representations, warranties, indemnities, acknowledgements and undertakings contained in this Appendix.
In particular, each such Placee irrevocably represents, warrants, undertakes, agrees and acknowledges (amongst other things) to each of the Company and N+1 Singer (for their own benefit and, where relevant, the benefit of any affiliate of N+1 Singer and/or the Company and person acting on their behalf, that:
No prospectus
No prospectus or other offering document has been or will be submitted to be approved by the FCA in relation to the Placing or the Placing Shares and Placees' commitments will be made solely on the basis of the information contained in this Announcement and any information publicly announced through a Regulatory Information Service (as defined in the AIM Rules for Companies (the "AIM Rules")) by or on behalf of the Company on or prior to the date of this Announcement (the "Publicly Available Information") and subject to any further terms set forth in the form of confirmation to be sent to individual Placees.
Each Placee, by participating 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 information (other than the Publicly Available Information), representation, warranty or statement made by or on behalf of N+1 Singer, the Company or any other person and none of N+1 Singer, the Company or any other person acting on such person's behalf nor any of their respective affiliates has or shall have any liability for any Placee's decision to participate in the Placing based on any other information, representation, warranty or statement. 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 N+1 Singer is 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. No Placee should 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.
Details of the Placing Agreement and the Placing Shares
N+1 Singer has today entered into a placing agreement (the "Placing Agreement") with the Company under which, on the terms and subject to the conditions set out in the Placing Agreement, N+1 Singer, as agent for and on behalf of the Company, has agreed to use its reasonable endeavours to procure Placees for the Placing Shares at the Placing Price.
The Placing Shares will, when issued, be subject to the articles of association of the Company and credited as fully paid and will rank pari passu in all respects with the Existing Ordinary Shares in the capital of the Company, including the right to receive all dividends and other distributions declared, made or paid in respect of such Existing Ordinary Shares after the date of issue of the Placing Shares.
The Placing is not being underwritten.
Application for admission to trading
Application will be made to the London Stock Exchange for admission of the Placing Shares to trading on AIM.
It is expected that Admission will take place no later than 8.00 a.m. on 6 August 2019 and that dealings in the Placing Shares on AIM will commence at the same time.
Principal terms of the Placing
Registration and Settlement
If Placees are allocated any Placing Shares in the Placing they will be sent a form of confirmation or electronic confirmation by N+1 Singer, as soon as it is able which will confirm the number of Placing Shares allocated to them, the Placing Price and the aggregate amount owed by them to N+1 Singer.
Each Placee will be deemed to agree that it will do all things necessary to ensure that delivery and payment is completed as directed by N+1 Singer in accordance with either the standing CREST or certificated settlement instructions which they have in place with N+1 Singer.
Settlement of transactions in the Placing Shares (ISIN: GB0002998192) following Admission will take place within the CREST system, subject to certain exceptions. Settlement through CREST is expected to take place on 6 August 2019 unless otherwise notified by N+1 Singer and Admission is expected to occur no later than 8.00 a.m. on 6 August 2019 unless otherwise notified by N+1 Singer. Settlement will be on a delivery versus payment basis. However, in the event of any difficulties or delays in the admission of the Placing Shares to CREST or the use of CREST in relation to the Placing, the Company and N+1 Singer may agree that the Placing Shares should be issued in certificated form. N+1 Singer reserves the right to require settlement for the Placing Shares, and to deliver the Placing Shares to Placees, by such other means as they deem necessary if delivery or settlement to Placees is not practicable within the CREST system or would not be consistent with regulatory requirements in a Placee's jurisdiction.
Interest is chargeable daily on payments not received from Placees on the due date in accordance with the arrangements set out above, in respect of either CREST or certificated deliveries, at the rate of 2 percentage points above prevailing LIBOR as determined by N+1 Singer.
Each Placee agrees that, if it does not comply with these obligations, N+1 Singer may sell, charge by way of security (to any funder of N+1 Singer) or otherwise deal with any or all of their Placing Shares on their behalf and retain from the proceeds, for N+1 Singer's own account and benefit, an amount equal to the aggregate amount owed by the Placee plus any interest due and any costs and expenses properly incurred by N+1 Singer a result of the Placee’s failure to comply with its obligations. The relevant Placee will, however, remain liable for any shortfall below the amount owed by it and for any stamp duty or stamp duty reserve tax (together with any interest or penalties) which may arise upon the sale of their Placing Shares on their behalf. Legal and/or beneficial title in and to any Placing Shares shall not pass to the relevant Placee until such time as it has fully complied with its obligations hereunder.
If Placing Shares are to be delivered to a custodian or settlement agent, Placees must ensure that, upon receipt, the conditional form of confirmation is copied and delivered immediately to the relevant person within that organisation. Insofar as Placing Shares are registered in a Placee's name or that of its nominee or in the name of any person for whom a Placee is contracting as agent or that of a nominee for such person, such Placing Shares should, subject as provided below, be so registered free from any liability to United Kingdom stamp duty or stamp duty reserve tax. Placees will not be entitled to receive any fee or commission in connection with the Placing.
Conditions of the Placing
The Placing is conditional upon the Placing Agreement becoming unconditional in all respects (other than Admission) and not having been terminated in accordance with its terms.
The obligations of N+1 Singer under the Placing Agreement are, and the Placing is, conditional upon, inter alia:
(all conditions to the obligations of N+1 Singer included in the Placing Agreement being together, the "conditions").
If any of the conditions set out in the Placing Agreement are not fulfilled in all respects or, where permitted, waived in accordance with the Placing Agreement within the stated time periods (or such later time and/or date as the Company and N+1 Singer may agree or, if no time and/or date is specified for the fulfilment thereof, by 8.00 a.m. on 6 August 2019, (or such later time(s) and/or date(s) as N+1 Singer may agree (being not later than 8.00 a.m. on 31 August 2019), the Placing Agreement is terminated in accordance with its terms, the Placing will lapse and the Placee's rights and obligations shall cease and terminate at such time and each Placee agrees that no claim can be made by or on behalf of the Placee (or any person on whose behalf the Placee is acting) in respect thereof.
By participating in the Placing, each Placee agrees that its rights and obligations cease and terminate only in the circumstances described above and under "Termination of the Placing" below and will not be capable of rescission or termination by it.
Certain conditions may be waived in whole or in part by N+1 Singer, in its absolute discretion by notice in writing to the Company and N+1 Singer may also agree in writing with the Company to extend the time for satisfaction of any condition. Any such extension or waiver will not affect Placees' commitments as set out in this Announcement.
N+1 Singer may terminate the Placing Agreement in certain circumstances, details of which are set out below.
Neither N+1 Singer, the Company nor any of their respective affiliates, agents, directors, officers, employees 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 any of them 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 any of them 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 N+1 Singer.
Termination of the Placing
N+1 Singer may terminate the Placing Agreement, in accordance with its terms, at any time prior to Admission if, inter alia:
If the Placing Agreement is terminated in accordance with its terms, the rights and obligations of each Placee in respect of the Placing as described in this Announcement shall cease and terminate at such time and no claim can be made by any Placee in respect thereof.
By participating in the Placing, each Placee agrees with the Company and N+1 Singer that the exercise by the Company or N+1 Singer of any right of termination or any other right or other discretion under the Placing Agreement shall be within the absolute discretion of the Company or N+1 Singer and that neither of the Company nor N+1 Singer need make any reference to such Placee and that neither N+1 Singer, the Company, nor any of their respective affiliates, agents, directors, officers or employees shall have any liability to such Placee (or to any other person whether acting on behalf of a Placee or otherwise) whatsoever in connection with any such exercise.
By participating in the Placing, each Placee agrees that its rights and obligations terminate only in the circumstances described above and under the "Conditions of the Placing" section above and will not be capable of rescission or termination by it after the issue by N+1 Singer of a form of confirmation confirming each Placee's allocation and commitment in the Placing.
Representations, warranties and further terms
By participating in the Placing, each Placee (and any person acting on such Placee's behalf) represents, warrants, acknowledges and agrees (for itself and for any such prospective Placee) that (save where N+1 Singer expressly agrees in writing to the contrary):
By participating in the Placing, each Placee (and any person acting on such Placee's behalf) agrees to indemnify and hold the Company, N+1 Singer and each of their respective affiliates, agents, directors, officers and employees 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 given by the Placee (and any person acting on such Placee's behalf) in this Appendix or incurred by N+1 Singer, the Company or each of their respective affiliates, agents, directors, officers or employees arising from the performance of the Placee's obligations as set out in this Announcement, and further agrees that the provisions of this Appendix shall survive after the completion of the Placing.
The agreement to allot and issue Placing Shares to Placees (or the persons for whom Placees are contracting as agent) free of stamp duty and stamp duty reserve tax in the United Kingdom relates only to their allotment and issue to Placees, or such persons as they nominate as their agents, direct by the Company. Such agreement assumes that the Placing Shares are not being acquired 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 related to any other dealings in the Placing Shares, stamp duty or stamp duty reserve tax may be payable. In that event, the Placee agrees that it shall be responsible for such stamp duty or stamp duty reserve tax and neither the Company nor N+1 Singer shall be responsible for such stamp duty or stamp duty reserve tax. If this is the case, each Placee should seek its own advice and they should notify N+1 Singer accordingly. In addition, Placees should note that they will be liable for any capital duty, 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 United Kingdom by them or any other person on the acquisition by them of any Placing Shares or the agreement by them to acquire any Placing Shares and each Placee, or the Placee's nominee, in respect 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 non-United Kingdom stamp, registration, documentary, transfer or similar taxes or duties undertakes to pay such taxes and duties, including any interest and penalties (if applicable), forthwith and to indemnify on an after-tax basis and to hold harmless the Company and N+1 Singer in the event that either the Company and/or N+1 Singer has incurred any such liability to such taxes or duties.
The representations, warranties, acknowledgements and undertakings contained in this Appendix are given to N+1 Singer for itself and on behalf of the Company and are irrevocable.
Each Placee and any person acting on behalf of the Placee acknowledges that N+1 Singer does not owe any fiduciary or other duties to any Placee in respect of any representations, warranties, undertakings, acknowledgements, agreements or indemnities in the Placing Agreement.
Each Placee and any person acting on behalf of the Placee acknowledges and agrees that N+1 Singer may (at its absolute discretion) satisfy its obligations to procure Placees by itself agreeing to become a Placee in respect of some or all of the Placing Shares or by nominating any connected or associated person to do so.
The rights and remedies of the Company and N+1 Singer under these terms and conditions are in addition to any rights and remedies which would otherwise be available to each of them and the exercise or partial exercise of one will not prevent the exercise of others.
When a Placee or any person acting on behalf of the Placee is dealing with N+1 Singer, any money held in an account with N+1 Singer 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 relevant rules and regulations of the FCA made under FSMA. Each Placee acknowledges that the money will not be subject to the protections conferred by the client money rules: as a consequence this money will not be segregated from N+1 Singer's money (as applicable) in accordance with the client money rules and will be held by it under a banking relationship and not as trustee.
References to time in this Announcement are to London time, unless otherwise stated.
All times and dates in this Announcement may be subject to amendment.
No statement in this Announcement is intended to be a profit forecast, and no statement in this Announcement should be interpreted to mean that earnings per share of the Company for the current or future financial years would necessarily match or exceed the historical published earnings per share of the Company.
The price of shares and any income expected from them may go down as well as up and investors may not get back the full amount invested upon disposal of the shares. Past performance is no guide to future performance, and persons needing advice should consult an independent financial adviser.
The Placing Shares to be issued or sold pursuant to the Placing will not be admitted to trading on any stock exchange other than the London Stock Exchange.
Neither the content of the Company's website nor any website accessible by hyperlinks on the Company's website is incorporated in, or forms part of, this Announcement.
DEFINITIONS
The following definitions apply throughout this Announcement unless the context otherwise requires:
"ABB" |
the accelerated bookbuild by which the Placing will be conducted |
"Acquisition" |
the acquisition by the Company of Tascomi Ltd |
"Acquisition Agreement" |
the sale and purchase agreement entered into on 31 July 2019 between the Company, Richard Martin, Joanne Martin, the Company and others for the acquisition by the Company of the entire issued share capital of Tascomi |
‘‘Admission’’ |
the admission of the Placing Shares to trading on AIM becoming effective in accordance with the AIM Rules |
‘‘AIM Rules’’ |
the AIM Rules for Companies published by the London Stock Exchange from time to time |
‘‘AIM’’ |
the market of that name operated by the London Stock Exchange |
“Announcement” |
this announcement, including the Appendix |
“Appendix” |
the appendix to this Announcement |
“Articles” |
the articles of association of the Company (as amended from time to time) |
‘‘Board’’ or “Directors’’ |
the directors of the Company or any duly authorised committee thereof |
“certificated” or “in certificated form” |
an Ordinary Share recorded on the Company’s share register as being held in certificated form (namely, not in CREST) |
“Company” |
Idox plc |
“Conditions” |
the conditions of the Placing as set out in the Placing Agreement and summarised in the Appendix to this Announcement |
“CREST” |
the relevant system (as defined in the CREST Regulations being SI 2001/3755 as amended from time to time) in respect of which Euroclear UK & Ireland is the operator (as defined in the said CREST regulations) |
‘‘Enlarged Share Capital’’ |
the Ordinary Shares in issue immediately following Admission, comprising the Existing Ordinary Shares and the Placing Shares |
“Existing Ordinary Shares” |
the 416,983,167 Ordinary Shares with voting rights in issue at the date of this Announcement |
“FCA” |
the Financial Conduct Authority in the UK or its successor from time to time |
“FSMA” |
the Financial Services and Markets Act 2000, as amended |
‘‘Group’’ |
the Company and its existing subsidiaries and subsidiary undertakings |
“London Stock Exchange” |
London Stock Exchange plc |
“MAR” |
the Market Abuse Regulation (EU No 596/2014) and all delegated regulations, technical standards and guidance relating thereto |
"N+1 Singer" |
Nplus1 Singer Advisory LLP, the Company’s nominated adviser and broker for the purposes of the Placing and Admission |
“Ordinary Shares” |
ordinary shares of 1 pence each in the capital of the Company |
“pence” |
pence sterling, the lawful currency of the UK |
“Placees” |
those persons procured by the Company who subscribe for Placing Shares pursuant to the Placing |
“Placing” |
the proposed placing of the Placing Shares at the Placing Price |
"Placing Agreement" |
the placing agreement dated 31 July 2019 between the Company and N+1 Singer relating to the Placing |
“Placing Price” |
the price per New Ordinary Share to be determined pursuant to the ABB |
“Placing Shares” |
the new Ordinary Shares to be issued pursuant to the Placing |
“Prospectus Directive” |
the Directive of the European Parliament and of the Council of the European Union 2003/71/EC |
“Regulation S” |
Regulation S under the Securities Act |
“Resolutions” |
the resolutions to be proposed at the General Meeting, which will be set out in the Notice |
“Securities Act” |
the United States Securities Act of 1933, as amended |
“Shareholders” |
the holders of Existing Ordinary Shares or Ordinary Shares (as the context requires) at the relevant time |
‘‘United Kingdom’’ or ‘‘UK’’ |
the United Kingdom of Great Britain and Northern Ireland |
“United States” or “US” |
the United States of America, its territories and possessions, any state of the United States of America and the District of Columbia and any other area subject to its jurisdiction |
“US Person” |
has the meaning set out in Regulation S of the Securities Act |
“£” |
pounds sterling, the lawful currency of the UK |
Updated: 31 July 2019