Last checked at 26 Nov 2009 07:00
NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION IN WHOLE OR IN PART, DIRECTLY OR INDIRECTLY, IN OR INTO THE UNITED STATES, JAPAN, CANADA, AUSTRALIA, NEW ZEALAND OR THE REPUBLIC OF SOUTH AFRICA
26 November 2009
Borders & Southern Petroleum plc
("Borders & Southern" or the "Company")
Placing of 234,234,234 new Ordinary Shares at 50p
to raise £113.1 million (net of expenses)
Borders & Southern, the independent oil and gas company focusing on exploration in the South Falklands basin, is pleased to announce that it has conditionally raised £113.1 million (US$188.4 million) net of expenses through a placing by Mirabaud, Ocean and Panmure Gordon with institutional investors of 234,234,234 new Ordinary Shares in the Company at 50p per share. The Placing is subject to Shareholders approving certain resolutions at an extraordinary general meeting to be held on 14 December 2009.
The Company will today post to Shareholders a circular in connection with the Placing (the "Circular"), which will be available at the Company's website at www.bordersandsouthern.com.
Background
The Company was formed in June 2004 and was granted five production licences by the Governor of the Falkland Islands over 19,598 square kilometres of the Falkland Plateau sub-basin, southeast of the Falkland Islands, with effect from 1 November 2004.
To date, the Company has fulfilled all work programme obligations of the production licences, having acquired, processed and interpreted 2,862 km of 2D seismic data and 1,492 km of 3D seismic data, as well as having commissioned and completed numerous technical studies.
Reasons for the Placing and use of the proceeds
As previously reported, the Company's understanding of the geology of its licensed acreage covered by its 2D and 3D seismic surveys has increased significantly. As noted in the Company's operational update released on 21 January 2009, multiple play fairways and potentially large prospects have been identified. These display geophysical attributes which the Board believes should enable the Company to reduce the risk associated with exploring them. These attributes include seismic amplitude conformance to structure, flat spot and AVO anomalies and gas hydrates located above many of the prospects.
The Company intends to drill up to three wells. The first prioritised prospects are Darwin and Stebbing. These represent different tests of the basin's geology. Darwin is a Lower Cretaceous tilted fault block whilst Stebbing is a Tertiary / Upper Cretaceous simple fold. Both structures have geophysical amplitude anomalies associated with the principal reservoir intervals. These prospects are not potentially the largest, but are considered by the Board to be the lowest risk. In the event of success in these first two wells, the Company may elect to drill a third well, either on a look-a-like structure or an appraisal well.
This programme will require sufficient funding being obtained to enable the Company both to hire a suitable rig and to undertake the drilling of these exploration wells. The Placing will allow the Company to fund three wells on a 100% basis. The possibility of securing a low interest partner may be considered at a future date to provide further cost mitigation.
The Board estimates that the capital expenditure to be incurred in drilling three deep water exploration wells to be approximately US$180 million. This assumes that the Company will fund all the mobilisation costs of the equipment and drilling rig. It may be possible to make significant cost savings on the mobilisation fees by sharing with other operators in the region. It is intended that any funds remaining after completion of the exploration drilling programme will be used to fund the Company's general working capital requirements.
The Company requested an independent consultant, AGR Peak Well Management, to undertake an analysis of potentially available suitable rigs and has been given preliminary advice that there is potential availability of rigs late in 2010 or early in 2011. The Company intends on completion of the Placing to undertake detailed discussions with certain rig owners and contractors with the objective of entering into a rig contract and starting the exploration drilling programme at the earliest opportunity. The Company intends to select and appoint a suitable drilling project management group to assist with these negotiations and subsequently to undertake the management of the exploration drilling programme on behalf of the Company.
Reasons for convening the Extraordinary General Meeting
Since the recent implementation of certain provisions of the Companies Act there is no longer a legal requirement for a company to have an authorised capital. In view of the size of the Placing, the Company would otherwise have needed to seek the approval of Shareholders to increase the authorised capital of the Company. The Board believes it is instead preferable to take the opportunity to propose that the authorised capital be revoked.
Section 551 of the Companies Act requires the Company to obtain the authority of its Shareholders before allotting any Ordinary Shares. Section 561 of the Companies Act gives Shareholders certain rights of pre-emption on the issue for cash of new Ordinary Shares. These rights of pre-emption can be disapplied by a special resolution passed pursuant to Section 570 of the Companies Act.
The authorities granted to the Directors at the annual general meeting of the Company on 23 June 2009 are insufficient to allow the Company to undertake the Placing and accordingly new additional authorities are being sought to implement the Placing and to allot the Placing Shares.
Details of the Placing
The Company is proposing to raise approximately £113.1 million (US$188.4 million) (net of expenses) by the issue of the Placing Shares at the Placing Price. The Placing Shares will represent approximately 54.7 per cent. of the enlarged issued share capital of the Company. Panmure Gordon, Mirabaud and Ocean have conditionally placed the Placing Shares with institutional investors at the Placing Price. Certain of the Directors are also subscribing for a total of 1,055,000 Placing Shares.
The Placing Shares will, when issued, rank pari passu in all respects with the existing Ordinary Shares.
Application has been made to the London Stock Exchange for the Placing Shares to be admitted to trading on AIM. It is expected that Admission will become effective and that dealings in the Placing Shares will commence at 8.00 a.m. on 15 December 2009.
The Placing is subject to a number of conditions including (i) the passing of the resolutions to be proposed at the Extraordinary General Meeting, (ii) the Placing Agreement not having been terminated prior to Admission and (iii) Admission.
The Placing has only been made (i) in the UK to persons falling within article 19 and article 49 of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 and who are also qualified investors for the purposes of section 86 of FSMA and (ii) in other jurisdictions in strict compliance with securities laws applicable therein, and no other person may participate in the Placing or rely on any communication relating to it. The offer of the Placing Shares has not been made to the public for the purposes of the Prospectus Rules. This announcement does not constitute an offer, or the solicitation of an offer, to subscribe for or buy any of the Placing Shares.
Under the terms of the Placing Agreement, Mirabaud, Panmure Gordon and Ocean will receive commissions from the Company conditional on Admission and the Company will give customary warranties, undertakings and indemnities to them in relation to the performance of their duties.
Extraordinary General Meeting
A notice convening the Extraordinary General Meeting to be held on Monday 14 December 2009 at 11.00 a.m. at 131 Finsbury Pavement, London EC2A 1NT is set out at the end of the Circular. At this meeting resolutions will be proposed as follows to revoke the authorised capital of the Company and accordingly delete article 3 of the Company's articles of association, to authorise the Directors to allot the Placing Shares and to disapply statutory pre-emption rights in relation to the Placing.
The Board believes that the Placing is in the best interests of the Company and Shareholders as a whole and is most likely to promote the success of the Company for the benefit of its members. The Directors therefore unanimously recommend that Shareholders vote in favour of the Resolutions to be proposed at the General Meeting, as they intend to do in respect of their own beneficial holdings, which amount in aggregate to 66,895,000 Ordinary Shares (representing approximately 34.4 per cent. of the current issued share capital of the Company).
Howard Obee, Chief Executive of Borders & Southern said:
"We are delighted to announce the success of this fundraising. The proceeds of the Placing will strengthen our already robust balance sheet and allow Borders & Southern to fund its drilling programme, which we expect to transform the Company's prospects. We wish to thank our existing shareholders for their support and to welcome our new investors."
For further information please contact:
| Borders & Southern Petroleum plc | |
| Howard Obee | 020 7661 9348 |
| Panmure Gordon | 020 7459 3600 |
| Dominic Morley | |
| Ashton Clanfield | |
| Callum Stewart | |
| Mirabaud | 020 7321 2508 |
| Peter Krens | |
| Ocean | 020 7786 4370 |
| Guy Wikes | |
| Tavistock Communications | 020 7920 3150 |
| Simon Hudson | |
DEFINITIONS
RISK FACTORS
An investment in the Company involves a high degree of risk. Actual future results, including resources, recoveries and work plans, could differ materially from estimates and expectations due to changes in market conditions affecting the oil and gas industry or oil and gas price levels; political or regulatory developments; reservoir performance; timely completion of work programmes; the outcome of commercial negotiations and technical or operating factors. In addition to the other information in this document, the Directors consider the following risk factors are of particular relevance to the Company's activities and to any investment in the Company. It should be noted that this list is not exhaustive. The risks are not presented in any order of priority.
Exploration and licence risk
The exploration for and development of hydrocarbons involves a high degree of risk. These risks include the uncertainty that the Company will discover sufficient oil or gas economically to exploit or will be able to exploit the discovered resource as intended. If the Company does not fulfil its licence obligations the Company could lose part or all of its interest in such licences. The Company has requested an extension to the first licence period for a further three years from 1 November 2009. This application is pending approval from the Department of Mineral Resources. Whilst the Company expects this application will be successful, there can be no assurance that an extension will be granted.
Drilling, developing and operating risks
Oil and gas drilling, developing and operating involves risks beyond the control of the Company, which may delay or impact its activities. These include mechanical failures or delays, weather conditions and Government regulations or delays. These could result in the activities being delayed or abandoned and substantial losses incurred. Drilling may not result in the discovery of economically viable hydrocarbon resources, due to insufficient resources being discovered, the resources not being of sufficient quality to be developed economically or the costs of development being uneconomic. Drilling is also subject to general industry operating risks such as environmental spills or hazards, explosions, fires, blow-outs, equipment failures, the occurrence of any of which could result in losses.
Increases in costs risk
The costs of oil and gas exploration, development and operating can vary due to circumstances outside the Company's control such as changing industry conditions, weather, economic circumstances and technical factors.
Economic and political risks
It is anticipated that all or the majority of the Company's activities will be outside the UK and, accordingly, there are a number of risks over which it has little control.
Ability to exploit successful discoveries
The Company may not be able to exploit commercially viable discoveries. Exploitation may require external approvals and the granting of these approvals is beyond the Company's control.
Additional financing
There is no assurance that the Company will be successful in raising sufficient funds to meet its licence obligations or to enable it to acquire additional projects.
Environmental regulation
Environmental and safety legislation may require stricter or additional standards than those currently in effect, a heightened degree of responsibility for companies and their directors and employees and more stringent enforcement of existing laws and regulations. There may also be unforeseen environmental liabilities resulting from oil and gas activities, which may be costly to remedy.
Market risk
The sale of production from a development of an discovered oil and gas resource will be dependant upon factors over which the Company has no control.
Volatility of prices for oil and gas
The supply, demand and prices for oil and gas are volatile and are influenced by factors beyond the Company's control.
Dependence on key personnel
The Company has a small management team and the loss of any key individual or the inability to attract appropriate personnel could impact the Company's performance.
Investment risk
The value of an investment in the Company could, for a number of reasons, go up or down. There is also the possibility that the market value of an investment in the Company may not reflect the true underlying value of the Company.
APPENDIX
This appendix contains important information for Placees (as defined below) in the United Kingdom. Members of the public are not eligible to take part in the Placing. This appendix and the terms set out herein are directed only at persons in the United Kingdom selected by Panmure Gordon, Mirabaud or Ocean who have professional experience in matters relating to investments and are "investment professionals" within the meaning of Article 19 (5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 (as amended) (the "Order"), are persons falling within Article 49(2)(a) to (d) ("high net worth companies, unincorporated associations, etc.") of the Order or are otherwise persons to whom it may lawfully be communicated (all such persons together being referred to as "Relevant Persons"). Any investment or investment activity to which the terms and conditions set out herein relates is available only to such persons and will be engaged in only with such persons.
Terms of the Placing
If a Relevant Person chooses to participate in the Placing by making or accepting an offer to acquire Placing Shares (each such Relevant Person whose participation is accepted by Panmure Gordon, Mirabaud or Ocean in accordance with this appendix being hereinafter referred to as a "Placee" and together, as the "Placees") it will be deemed to have read and understood this announcement and this appendix in its entirety and to be making or accepting such offer on the terms and to be providing the representations, warranties and acknowledgements, contained in this appendix.
The Placing Shares referred to in this announcement have not been and will not be registered under the US Securities Act of 1933 (the "Securities Act") or under the securities laws of any state of the United States of America (the "United States"), and may not be offered or sold, taken up, delivered or transferred (directly or indirectly) in or into the United States or to a person within the United States and will not qualify for sale within the United States. There will be no public offer of the Placing Shares in the United States. The Placing Shares have not been recommended, approved or disapproved by any United States federal or state securities commission or regulatory authority. Furthermore, the foregoing authorities have not confirmed the accuracy or determined the adequacy of this announcement. Any representation to the contrary is a criminal offence in the United States. The Placing Shares will not be lodged with or registered by the Australian Securities and Investments Commission under Australia's Corporations Law and are not being offered for subscription or sale and may not be directly or indirectly offered, sold, taken up, transferred or delivered in or into Australia or to or for the account or benefit of any person or corporation in (or with a registered address in) Australia. No document in relation to the Placing Shares has been or will be lodged for registration with the Registrar of Companies in the Republic of Ireland and the Placing Shares will not be offered, sold or delivered, directly or indirectly in the Republic of Ireland. All subscribers for Placing Shares must provide addresses outside the Republic of Ireland for the receipt of certificates for Placing Shares. The relevant clearances have not been, and will not be obtained from the Ministry of Finance of Japan and no circular in relation to the Placing Shares has been or will be lodged with or registered by the Ministry of Finance of Japan. The Placing Shares may not therefore be offered, taken up, transferred or sold, directly or indirectly, in or into Japan, its territories and possessions and any areas subject to its jurisdiction or to any resident of Japan. The approval of the South African Exchange Control Authorities has not been, and will not be, obtained in relation to the Placing Shares. The Placing Shares may not therefore be offered, taken up, transferred or sold directly or indirectly in or into South Africa or to a resident of South Africa. The Placing Shares may not be offered, taken up, transferred or sold directly or indirectly in or into Canada or to a resident of Canada. This announcement and appendix do not constitute an offer to sell or issue or a solicitation of an offer to buy or subscribe for Placing Shares in any jurisdiction. The distribution of this announcement and the placing and issue of the Placing Shares in certain jurisdictions may be restricted by law. Persons to whose attention this announcement has been drawn are required by the Company and Panmure Gordon, Mirabaud or Ocean to inform themselves about and to observe any such restrictions.
| 1. | Panmure Gordon, Mirabaud and Ocean will arrange the Placing as agents for and on behalf of the Company. Participation will only be available to persons invited to participate by Panmure Gordon, Mirabaud or Ocean. Panmure Gordon, Mirabaud or Ocean will determine in their absolute discretion, following consultation with the Company, the extent of each Placee's participation in the Placing, which will not necessarily be the same for each Placee. |
| 2. | The price payable per new Ordinary Share shall be the Placing Price. |
| 3. | A Placee's commitment to subscribe for a fixed number of Placing Shares will be agreed with and confirmed to it orally by Panmure Gordon, Mirabaud or Ocean (the "Placing Commitment") and a contract note (a "Contract Note") will be dispatched as soon as possible thereafter. The oral confirmation to the Placee by Panmure Gordon, Mirabaud or Ocean (the "Oral Confirmation") constitutes an irrevocable, legally binding contractual commitment to Panmure Gordon, Mirabaud or Ocean (as agent for the Company) to subscribe for the number of Placing Shares allocated to it on the terms set out in this appendix. |
| 4. | Commissions will not be paid to Placees in connection with the Placing. |
| 5. | Panmure Gordon, Mirabaud and Ocean have the right together, inter alia, to terminate the agreement entered into between Panmure Gordon, Mirabaud, Ocean and the Company in connection with the Placing (the "Placing Agreement") at any time prior to Admission if, inter alia, (i) any of the warranties contained in the Placing Agreement are untrue, inaccurate or misleading in any material respect; or (ii) there occurs an event of force majeure. If the Placing Agreement is terminated prior to Admission, the Placing will lapse and the rights and obligations of the Placees hereunder shall cease and determine at such time and no claim can be made by any Placee in respect thereof. In such event, all monies (if any) paid by the Placees to Panmure Gordon, Mirabaud or Ocean at such time shall be returned to the Placees at their sole risk without any obligation on the part of the Company or Panmure Gordon, Mirabaud or Ocean or any of their respective affiliates to account to the Placees for any interest earned on such funds. The Placees acknowledge and agree that the Company and Panmure Gordon, Mirabaud or Ocean may, at their sole discretion, exercise their contractual rights to waive or to extend the time and/or date for fulfilment of any of the conditions in the Placing Agreement. Any such extension or waiver will not affect Placees' commitments. |
| 6. | Neither Panmure Gordon, Mirabaud or Ocean nor the Company shall have any liability to any Placee nor shall they owe any Placee fiduciary duties in respect of any claim they may have under the Placing Agreement (or, in either circumstance, to any other person whether acting on behalf of a Placee or otherwise) in respect of the exercise of its contractual rights to waive or to extend the time and/or date for the satisfaction of any condition in the Placing Agreement or in respect of termination of the Placing Agreement or in respect of the Placing generally. |
| 7. | Each Placee acknowledges to, and agrees with, Panmure Gordon, Mirabaud or Ocean for itself and as agent for the Company, that except in relation to the information in this announcement and the presentation, it has relied on its own investigation of the business, financial or other position of the Company in deciding to participate in the Placing. |
| 8. | Settlement of transactions in the Placing Shares following Admission will take place within CREST, subject to certain exceptions. Panmure Gordon, Mirabaud or Ocean reserves the right to require settlement for and delivery of the Placing Shares to the Placees in such other means that it deems necessary if delivery or settlement is not possible within CREST within the timetable set out in this announcement or would not be consistent with the regulatory requirements in the jurisdictions of such Placees. |
| 9. | It is expected that settlement of the Placing will occur on 15 December 2009, on which date each Placee must settle the full amount owed by it in respect of the Placing Shares allocated to it. Panmure Gordon, Mirabaud or Ocean may (after consultation with the Company) specify a later settlement date (or dates) at its absolute discretion. Payment must be made in cleared funds. The payment instructions for settlement in CREST and settlement outside of CREST will be set out in the Contract Note. The trade date of the Placing Shares is 26 November 2009. Interest is chargeable daily on payments to the extent that value is received after the due date at the rate per annum of 2 percentage points above the Barclays Bank plc base rate. If a Placee does not comply with these obligations, Panmure Gordon, Mirabaud or Ocean may sell the Placing Shares allocated to such Placee (as agent for such Placee) and retain from the proceeds, for its own account, an amount equal to the Placing Price plus any interest due. The relevant Placee will, however, remain liable, inter alia, for any shortfall below the Placing Price and it may be required to bear any stamp duty or stamp duty reserve tax (together with any interest or penalties) which may arise upon the sale of its Placing Shares on its behalf. Time shall be of the essence as regards the obligations of Placees to settle payment for the Placing Shares and to comply with their other obligations under this appendix. |
| 10. | If Placing Shares are to be delivered to a custodian or settlement agent of a Placee, the relevant Placee should ensure that its Contract Note is copied and delivered immediately to the relevant person within that organisation. Insofar as Placing Shares are to be registered in the name of a Placee or that of its nominee or in the name of any person for whom the Placee is contracting as agent or that of a nominee for such person, such Placing Shares will, subject as provided below, be so registered free from any liability to UK stamp duty or stamp duty reserve tax. Placees should match the CREST details as soon as possible or if using a settlement agent they should instruct their agent to do so. Failure to do so could result in a CREST Settlement fine. |
Representations and warranties by Placees
By participating in the Placing, each Placee (and any persons acting on its behalf):
| 1. | represents and warrants that it has read this announcement in its entirety and acknowledges that its participation in the Placing will be governed by the terms of this announcement (including this appendix) and the Placing Agreement; |
| 2. | represents, warrants and undertakes that it will subscribe for the Placing Shares allocated to it in the Placing and pay up for the same in accordance with the terms of this appendix failing which the relevant Placing Shares may be placed with other subscribers or sold as Panmure Gordon, Mirabaud or Ocean determines and without liability to such Placee; |
| 3. | confirms Panmure Gordon, Mirabaud or Ocean's absolute discretion with regard to the Placing Agreement and agrees that Panmure Gordon, Mirabaud or Ocean owes it no fiduciary duties in respect of any claim it may have relating to the Placing; |
| 4. | undertakes and acknowledges that its obligations under the Placing are legally binding and irrevocable; |
| 5. | represents and warrants that it is entitled to subscribe for Placing Shares under the laws of all relevant jurisdictions which apply to it and that it has fully observed and complied with such laws and obtained all such governmental and other guarantees and other consents which may be required thereunder and complied with all necessary formalities; |
| 6. | acknowledges that it is not entitled to rely on any information (including, without limitation, any information contained in any management presentation given in relation to the Placing) other than that contained in this announcement (including this appendix and represents and warrants that it has not relied on any representations relating to the Placing, the Placing Shares or the Company other than the information contained in this announcement); |
| 7. | represents and warrants that the issue to the Placee, or the person specified by such Placee for registration as holder of Placing Shares, will not give rise to a liability under any of sections 67, 70, 93 or 96 of the Finance Act 1986 (depositary receipts and clearance services); |
| 8. | represents and warrants that it is aware of and has complied with its obligations in connection with money laundering under the Proceeds of Crime Act 2002 and the Money Laundering Regulations 2007 (the "Regulations") and, if it is making payment on behalf of a third party, that satisfactory evidence has been obtained and recorded by it and that the applicable procedures have been carried out to verify the identity of the third party as required by the Regulations; |
| 9. | represents and warrants that it is a person falling within Article 19 (5) or Article 49(2)(a) to (e) of the Order and undertakes that it will acquire, hold, manage or dispose of any Placing Shares that are allocated to it for the purposes of its business; |
| 10. | represents and warrants that it has complied and will comply with all applicable provisions of FSMA with respect to anything done by it in relation to the Placing Shares in, from or otherwise involving the United Kingdom and will not sell or offer to sell the Placing Shares in a manner which will result in an offer to the public in the United Kingdom within the meaning of FSMA; |
| 11. | represents and warrants that its obligations under the Placing are valid, binding and enforceable and that it has all necessary capacity and authority, and has obtained all necessary consents and authorities to enable it to commit to participation in the Placing and to perform its obligations in relation thereto and will honour its obligations (including, without limitation, in the case of any person on whose behalf it is acting, all necessary consents and authorities to agree to the terms set out or referred to in this announcement); |
| 12. | acknowledges that Panmure Gordon, Mirabaud or Ocean is acting solely for the Company and that participation in the Placing is on the basis that it is not and will not be a client or customer of Panmure Gordon, Mirabaud or Ocean or any of their affiliates and that Panmure Gordon, Mirabaud or Ocean and their affiliates have no duties or responsibilities to it for providing the protections afforded to their clients or customers or for providing advice in relation to the Placing or in respect of any representations, warranties, undertakings or indemnities contained in the Placing Agreement nor for the exercise or performance of any of Panmure Gordon, Mirabaud or Ocean's rights and obligations thereunder, including any right to waive or vary conditions or exercise any termination right; |
| 13. | undertakes and agrees that (i) the person whom it specifies for registration as holder of the Placing Shares will be (a) the Placee or (b) a nominee of the Placee, (ii) neither Panmure Gordon, Mirabaud or Ocean nor the Company or any of their respective affiliates will be responsible for any liability to stamp duty or stamp duty reserve tax resulting from a failure to observe this requirement and (iii) the Placee and any person acting on its behalf agrees to subscribe on the basis that the Placing Shares will be allotted to the CREST stock account of Panmure Gordon, Mirabaud or Ocean which will act as settlement agent in order to facilitate the settlement process; |
| 14. | acknowledges that any agreements entered into by it pursuant to these terms and conditions shall be governed by and construed in accordance with the laws of England and it submits (on behalf of itself and on behalf of any person on whose behalf it is acting) to the exclusive jurisdiction of the English courts as regards any claim, dispute or matter arising out of any such contract; |
| 15. | acknowledges and agrees that the Placing Shares have not been and will not be registered under the Securities Act or under the relevant securities laws of any state of the United States, that the relevant clearances have not been and will not be obtained from the Securities Commission of any Province of Canada and that the Placing Shares have not been and will not be registered under the relevant securities laws of any of Australia, Japan, the Republic of Ireland or South Africa or any state or territory within any such country and, subject to certain limited exceptions, may not be, directly or indirectly, offered, sold, renounced, transferred, taken-up or delivered in, into or within those jurisdictions; |
| 16. | represents, warrants and acknowledges to each of Panmure Gordon, Mirabaud and Ocean for itself and as agent for the Company that it is outside the United States and will only offer and sell the Placing Shares outside the United States in offshore transactions in accordance with Regulation S of the Securities Act; |
| 17. | represents, warrants and undertakes and agrees that neither it nor its affiliates (as defined in Rule 501(b) of the US Securities Act) nor any person acting on its or their behalf have engaged in or will engage in any "general solicitation or general advertising" (within the meaning of Regulation D under the US Securities Act) or "directed selling efforts" (as defined in Regulation S under the US Securities Act) in connection with any offer or sale of the Placing Shares; |
| 18. | acknowledges that the agreement to settle each Placee's subscription (and/ or the subscription of a person for whom it is contracting as agent) free of stamp duty and stamp duty reserve tax depends on the settlement relating only to a subscription by it and/or such person direct from the Company for the Placing Shares in question. Such agreement assumes that the Placing Shares are not being acquired in connection with arrangements to issue depositary receipts or to transfer the Placing Shares into a clearance service. If there were any such arrangements, or the settlement related to other dealings in the Placing Shares, stamp duty or stamp duty reserve tax may be payable, for which neither the Company nor Panmure Gordon, Mirabaud or Ocean nor any of their respective affiliates will be responsible. If this is the case, the relevant Placee should take its own advice and notify Panmure Gordon, Mirabaud or Ocean 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 UK 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 |
| 19. | acknowledges that any monies of any Placee or any person acting on behalf of the Placee held or received by Panmure Gordon, Mirabaud or Ocean will not be subject to the protections conferred by the FSA's Client Money Rules. As a consequence, these monies will not be segregated from the monies of Panmure Gordon, Mirabaud or Ocean and may be used by Panmure Gordon, Mirabaud or Ocean in the course of its business, and the relevant Placee or any person acting on its behalf will therefore rank as a general creditor of Panmure Gordon, Mirabaud or Ocean. |
The acknowledgements, undertakings, representations and warranties referred to above are given to each of the Company and Panmure Gordon, Mirabaud or Ocean (for their own benefit and, where relevant, the benefit of their respective affiliates) and are irrevocable. The Company and Panmure Gordon, Mirabaud or Ocean will rely upon the truth and accuracy of the foregoing acknowledgements, undertakings, representations and warranties.