RE: 3P+ WINNING EASY10 Jun 2019 10:53
The Proposals are necessary to finance the immediate working capital requirements of the Company as announced on 9 April 2019 and on 13 May 2019. The Board, however, remains of the view that equity investment in addition to the Subscription and Debt to Equity Swap is required to meet the short-term working capital requirements of the Company. It is intended that, on publication of the Company's annual report for the year ended 31 December 2018 which is anticipated shortly after Admission, the Company will seek to raise an additional £4.5 million (the "Additional Funds") by way of a placing and further subscription of new Ordinary Shares with new and existing shareholders at the Issue Price. The Consortium has indicated that, acting together with its business partners and associates, it may subscribe for up to £2.5 million of this amount, subject to review of the annual report, however no assurance can be given in this respect.
Shareholders should be aware that if Resolutions 1 to 5 are not approved at the General Meeting, the Subscription will not complete and none of the net proceeds of the Subscription will be received. If this were to happen then the Group would only have sufficient working capital to trade through to late June 2019. Accordingly, based on the projected cash flows of the Group, it is highly likely the Company would need to be placed into administration.
Furthermore, if the Subscription completes but the Company is unable to raise Additional Funds of at least £4.5 million by 31 July 2019 then, based on the projected cash flows of the Group, the Company will be unable to pay its creditors and it is highly likely that it would need to be placed into administration. If Resolutions 6 and 7 are not approved at the General Meeting the Company will be unable to raise the Additional Funds.
In the event that the Company is unable to meet such obligations as a result of the failure of the Subscription to complete and/or the failure to raise Additional Funds by 31 July 2019, it is unlikely that the Company will be able to continue trading and it is highly likely that the Directors would need (in order to fulfil their duties to the Company's creditors (and to other applicable stakeholders)) to place the Company into administration. Any such administration would be likely to result in little or no value for Shareholders.