EZH.L Regulatory News (EZH)

RNS Number : 6190F

easyHotel PLC

22 February 2018

 

THIS ANNOUNCEMENT (INCLUDING THE APPENDIX) 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, JAPAN, SOUTH AFRICA OR ANY OTHER JURISDICTION IN WHICH SUCH RELEASE, PUBLICATION OR DISTRIBUTION WOULD BE UNLAWFUL.

22 February 2018

easyHotel plc

Proposed Placing of 45,454,546 new Ordinary Shares at 110.0 pence per share

easyHotel plc (LSE: EZH) ("easyHotel" or the "Company" and together with its subsidiaries, the "Group"), the owner, developer, operator and franchisor of super budget branded hotels, today announces a conditional placing of 45,454,546 new ordinary shares of 1.0 pence each ("Ordinary Shares") in the capital of the Company (the "Placing Shares") at a price of 110.0 pence per Placing Share (the "Placing Price") to raise approximately £50.0 million (before expenses) (the "Placing").

The Placing Shares represent approximately 45.2 per cent. of the Ordinary Shares in issue as at the date hereof ("Existing Ordinary Shares") and the Placing Price represents a discount of approximately 3.9 per cent. to the closing mid-market price of 114.5 pence per Existing Ordinary Share on 21 February 2018, being the latest practicable date prior to the publication of this Announcement.

Highlights

· Gross proceeds of the Placing of approximately £50.0 million before expenses (approximately £48.8 million after expenses).

· Proceeds of the Placing to be primarily utilised to fund the acceleration of the Group's owned hotel roll-out strategy.

· Targeted owned hotel pipeline of 1,122 rooms across the UK and Europe in popular business and leisure city centre destinations.

· Targeted owned pipeline builds on the Group's established portfolio of 2,343 rooms across 26 hotels. A further 2,739 owned and franchised rooms are already committed to and funded and seven of these owned hotels are anticipated to open in the next two years.

· Trading for the year ending 30 September 2018 is in line with Board expectations.

· Board expects its committed owned hotel pipeline under development to make a significant contribution to system sales, revenue and adjusted EBITDA going forward and further expects the investment of new capital in the hotel pipeline to be earnings per share enhancing in the medium term.

· Placing conditional on, inter alia, the passing of the Resolutions which are to be proposed at a General Meeting of the Company to be held on 12 March 2018 and Admission taking place by no later than 13 March 2018.

· Investec Bank plc ("Investec") is acting as Nominated Adviser and sole broker to the Company.

Guy Parsons, Chief Executive Officer, commented:

"The Group has made excellent progress in line with its strategy to speed up owned hotel development and accelerate the roll-out of franchise hotels to drive returns on investment.

"The strong and ongoing market outperformance of our growing owned hotel portfolio has continued into the current financial year with RevPAR up 10.9% against their competitive set as measured by STR.

"The proceeds from today's placing will enable us to continue the acceleration of our owned hotel development pipeline, allowing us to take advantage of the significant opportunities within our markets, delivering enhanced returns for our shareholders and underpinning the long-term growth of the easyHotel brand."

 

A circular, extracts of which are set out below, containing a notice of General Meeting of the Company (the "Circular"), convened for 11.00 a.m. on 12 March 2018, will be sent to Shareholders today convening the General Meeting at which the Resolutions will be tabled. A copy of the Circular will also be made available on the Company's website, http://ir.easyhotel.com Capitalised terms used in this Announcement but not otherwise defined have the meaning given to those terms in the Circular, unless otherwise indicated.

 

Enquiries:

easyHotel plc	via Houston PR
Guy Parsons, Chief Executive Officer Marc Vieilledent, Chief Financial Officer
Investec Bank plc - Nominated Adviser and Sole Broker	+44 (0) 20 7597 5970
Chris Treneman / David Anderson William Brown / Neil Coleman
Houston PR - PR Adviser to easyHotel	+44 (0) 20 3701 7660
Kate Hoare

 

 

Notes to Editors:

 

www.easyhotel.com http://ir.easyhotel.com

 

easyHotel is the owner, developer, operator and franchisor of branded hotels. Its strategy is to target the super budget segment of the hotel industry by marketing "clean, comfortable and safe" hotel rooms to its customers.

 

Operating hotels

easyHotel's seven owned hotels currently comprise 702 rooms, and it has a further 19 franchised hotels with 1,641 rooms.

 

Owned hotels:

Old Street (London), Glasgow, Croydon, Birmingham, Manchester, Liverpool, Newcastle*.

 

Franchise locations:

Belgium (Brussels), Bulgaria (Sofia), Germany (Berlin, Frankfurt), Hungary (Budapest), The Netherlands (Amsterdam: City, Arena & Zaandam, Rotterdam, The Hague), Switzerland (Basel, Zurich), UAE (Dubai), United Kingdom (Edinburgh, London Heathrow, Central London, Luton).

 

Hotel development pipeline

The Company's committed development pipeline of owned and franchised hotels currently consists of:

 

Owned hotels:

United Kingdom (Ipswich, Sheffield, Leeds), Spain (Barcelona). Subject to planning consent: United Kingdom (Milton Keynes, Cardiff and Oxford*).

 

Franchise hotels:

UAE (Dubai), Germany (Bernkastel-Kues), Portugal (Lisbon), Turkey (Istanbul), UK (Belfast, Reading), Iran, Sri Lanka, Netherlands (The Hague Scheveningen Beach, Maastricht).

 

*Hotels under an operating lease.

 

This Announcement should be read in its entirety. In particular, you should read and understand the information provided in the "Important Notices" section of this Announcement.

IMPORTANT NOTICES

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.

Investec is authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority (the "FCA") and the Prudential Regulation Authority in the United Kingdom and is acting exclusively for the Company and no one else in connection with the Placing, and Investec 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 Investec 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.

The distribution of this Announcement in certain jurisdictions may be restricted by law. This Announcement is for information purposes only and 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, Australia, Canada, Japan or South Africa or in any jurisdiction in which such offer or solicitation would be unlawful and should not be relied upon in connection with any decision, or as any inducement, to subscribe for or acquire any new Ordinary Shares. In particular, this Announcement 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. No public offer of securities is being made in the United Kingdom or elsewhere.

This Announcement is not an offer of securities for sale or a solicitation of any offer to purchase securities in the United States. Placing Shares may not be offered or sold in the United States absent registration under the US Securities Act of 1933, as amended (the "US Securities Act") or an exemption therefrom. The Company has not and does not intend to register any securities under the US Securities Act and does not intend to offer any securities to the public in the United States. 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. The Placing Shares have not been and will not be registered with any regulatory authority of any state within the United States.

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 the Placing with the result that certain persons became aware of inside information (as defined in MAR), as permitted by MAR. This inside information is set out in this Announcement. Therefore, those persons that received inside information in a market sounding are no longer in possession of such inside information relating to the Company and its securities.

Information to Distributors

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 (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 retail investors and investors who meet the criteria of professional clients and eligible counterparties, each as defined in MiFID II; and (ii) eligible for distribution through all distribution channels as are permitted by MiFID II (the "Target Market Assessment").

Notwithstanding the 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; Placing Shares offer no guaranteed income and no capital protection; and an investment in 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, Investec 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 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 Placing Shares.

Each distributor is responsible for undertaking its own target market assessment in respect of the Placing Shares and determining appropriate distribution channels.

 

Placing of 45,454,546 new Ordinary Shares at 110.0 pence per share

raising £50.0 million (before expenses)

 

1. Introduction

easyHotel plc (LSE: EZH) ("easyHotel" or the "Company"), the owner, developer, operator and franchisor of super budget branded hotels, today announces that it is proposing to raise approximately £50.0 million by way of the Placing by Investec. In line with the Company's strategy, the net funds from the Placing will be primarily used to fund the acceleration of the Group's owned hotel roll-out strategy.

2. Background to and reasons for the Placing

The Group is an international owner, developer, operator and franchisor of "easyHotel" branded hotels. The Group's strategy is to target the growing super budget segment of the hotel industry by marketing "clean, comfortable and safe" hotel rooms to its customers.

By maintaining operational efficiency in the management of the hotels, minimising building costs and driving significant levels of direct internet distribution derived from the "easy" brand recognition, the Company and its franchisees are able to achieve high returns on capital whilst at the same time offering the consumer the "best branded room rate in town" as a compelling marketing proposition.

In the owned hotel market, the Directors believe there is potential for approximately 12,000 easyHotel rooms in the UK and in key gateway European cities. The Board is confident, that with adequate resources, the Company should be able to deliver significant growth in the coming years.

In the franchised hotel market, the Directors believe there is an opportunity to open approximately 15,000 franchised easyHotel rooms in the UK and Europe, in locations where they do not currently intend to establish an owned hotel in the foreseeable future. The Board continues to consider the roll-out of its franchised estate to be extremely valuable to the business through not only contributing high incremental margin, but also making contributions to the brand marketing budget and increasing the easyHotel brand presence without the need for capital investment by the Company.

In terms of evaluating new owned site opportunities, the Board assess sites on the basis of their potential unlevered return on capital employed ("ROCE"). The Board targets a Group 15 per cent. blended ROCE based upon mature EBITDA, through investment in owned and leased hotels and its franchise network. The Board targets delivering this through achieving between:

1. £8,000-10,000 EBITDA per hotel room at maturity delivering between 12-13 per cent. ROCE from investment in owned hotels;

2. £2,000-4,000 EBITDA per hotel room at maturity from investment in leased hotels; and

3. £600-1,000 plus fees per hotel room at maturity from its franchised estate.

2.1 The Existing Owned Hotel Portfolio

Since the Company's shares were admitted to trading on AIM in 2014, the Group's owned hotel portfolio has grown to seven hotels with 702 rooms in aggregate as follows:

Location	Type	Number of rooms
Birmingham	Long leasehold	86
Croydon	Long leasehold	103
Glasgow	Freehold	124
Liverpool	Freehold	78
Manchester	Freehold	115
Newcastle	Lease	104
Old Street, London	Freehold	92
Total		702

 

The implementation of a new booking engine and revenue management system rollout, together with selling an allocation of rooms via selected online travel agencies ("OTAs"), resulted in owned hotels significantly outperforming their competitive set throughout the 2017 financial year. For the year ended 30 September 2017, the Group's owned hotels delivered an increased occupancy rate at 86.7 per cent. (2016: 82.1 per cent.) combined with also delivering an increased average daily rate ("ADR") of £41.90 (2016: £40.00).

Furthermore, the Group's most recent hotel openings in Newcastle, Liverpool, Birmingham and Manchester, have opened in the Group's new brand style and have traded strongly since opening, performing better than their original businesses cases, partly offsetting industry wide construction cost inflation that has generally added to owned hotel project costs.

In addition to the Group's owned hotel portfolio, the Group has a further 19 franchised hotels with 1,641 rooms.

2.2 The Committed Owned Hotel Portfolio

The Group has secured a significant committed owned hotel portfolio comprising seven hotels with 941 rooms in aggregate under development which the Board expects to be able to fund from the Group's existing resources:

Location	Type	Number of rooms	Planned opening
Barcelona	Freehold	204	2018
Cardiff*	Freehold	120	2019
Ipswich	Freehold	89	2018
Leeds	Long leasehold	93	2018
Milton Keynes*	Long leasehold	124	2019
Oxford*	Lease	180	2019
Sheffield	Long leasehold	131	2018
Total		941

Note: * Subject to planning permission

The Board expects its committed owned hotel pipeline under development to make a significant contribution to system sales, revenue and adjusted EBITDA going forward.

In addition to the Group's committed owned hotel portfolio, the Group has a further 15 franchised hotels with 1,798 rooms committed.

2.3 The Acquisition Pipeline Portfolio

The Group has under constant review a large number of investment opportunities, either single hotel development projects or acquisitions or hotel chain acquisitions, to further accelerate the Group's growth in both the UK and key Western European countries. Whilst the Group currently has the team in place to deliver the existing pipeline, with an objective to strike a balance between future European and UK developments in the medium term, the Group is likely to invest in its hotel development team to facilitate the Group's European expansion.

The owned hotel acquisition pipeline numbers eight hotels, equating to approximately 1,122 rooms and the acquisition and development cost of which is estimated at approximately £60 million. These sites are located in both the UK and Europe as follows:

UK acquisition pipeline

The UK hotel acquisition pipeline comprises six hotels with between 100 to 130 bedrooms each and is a mixture of new build freehold development sites and leased sites. Each of the sites is located in the centre of a British city, with each site agreed in principle or at the stage of legal due diligence and documentation. If these sites were to be acquired, the Board expects these sites to open during 2019.

European acquisition pipeline

The European acquisition pipeline comprises two hotels, one new build freehold and one leased, with around 200 bedrooms each. The first of the sites is located close to the main train station of a Spanish city and the second is close to the major airport of a French city. Each site is agreed in principle with the vendor or at the stage of legal due diligence and documentation. If these sites were to be acquired, the Board expects these sites to open during 2020.

There can be no guarantee that these eight hotels will be acquired, therefore, management has also identified a further eight potential acquisition sites representing approximately 1,285 rooms in the UK which are currently at various stages of evaluation and negotiation.

4. Current trading and outlook

The following wording is extracted without adjustment from the trading update released by the Company on 29 January 2018:

 

"Trading Overview

The strong trading experienced in the prior year across the Group's owned and franchised hotel estates has continued, with the Group's performance since the financial year ended 30 September 2017 in line with the Board's expectations.

 

The Group's owned hotels have continued to significantly outperform both their competitive set and the wider UK hotel market.

 

The period saw the opening of a new owned 78 room hotel in Liverpool, and the acquisition and opening of a 104-room hotel in Newcastle. Both hotels are trading in line with the strong performance of the hotels opened during the last financial year.

 

The Group's franchised hotels have also continued to trade strongly, particularly in Continental Europe.

 

Owned Hotel Refurbishment

A £1.5m refurbishment of the hotels in Croydon and Glasgow is now well underway to bring them into line with the updated brand look. The Group expects the refurbishment to be revenue enhancing during the current financial year.

As previously announced the Board plans to retain a 92-room hotel at Old Street, refurbishing the hotel in line with our new brand format. Planning permission is being sought to add an additional floor to the building and increase the Net Internal Area of the building, for use as office accommodation, which should maximise value from this freehold property.

 

Owned Hotel Development Pipeline

In October 2017 the Group acquired a freehold site in central Cardiff for the development of a 120- room hotel, subject to planning permission. The hotel is anticipated to open in 2019.

 

On 26 January 2018 the Group announced the conditional acquisition of a 125-year leasehold of part of Norfolk House on Silbury Boulevard, a central site in Milton Keynes. The Group intends to convert its part of the building into a 124-bedroom hotel, which is expected to open by mid-2019.

 

Other new hotels projects currently under construction include Leeds (93 rooms), Sheffield (131 rooms), Ipswich (89 rooms) and Barcelona (204 rooms) which are all expected to open in 2018.

 

Franchised Hotel Development Pipeline

In November 2017 the Group announced a further two franchised hotels (162 rooms) under development in The Hague and Maastricht, scheduled to open in the second half of 2018.

 

Other new franchise hotel projects currently under construction include Lisbon (101 rooms), Bernkastel- Kues (100 room hotel), Belfast (81 rooms), Reading (54 rooms) and Bur Dubai (300 rooms) which are all planned to open in 2018.

 

The Group also has hotels under development in Istanbul (300 rooms), Iran (500 rooms) and Sri Lanka (200 rooms) for beyond 2018 which will, on completion, enhance its position as the super budget hotel brand of scale in the UK and Middle East."

 

The Board considers trading for the current financial year ending 30 September 2018 to be in line with its expectations.

 

5. Financing and use of proceeds

The Group's owned hotel committed pipeline of six hotels has a financing commitment of approximately £39.2 million as at 31 January 2018. The Group's committed leased development hotel in Oxford will require investment of approximately £1 million prior to opening. The Group has also commenced refurbishment works at the Group's existing owned hotels in Croydon and Glasgow in order to bring those hotels up to the Group's new design standard, requiring an investment of approximately £1.5 million.

 

This investment is expected to be financed from cash on the balance sheet of approximately £33.3 million as at 30 September 2017, approximately £1.6 million from operating cash flow together with the drawdown of the Euro-denominated €8.3 million (approximately £6.9 million) facility for the Group's new Barcelona hotel.

 

The proceeds of the Placing will, therefore, be primarily utilised to fund the Group's owned hotel roll-out strategy.

 

The Board maintains a prudent strategy not to borrow more than three times net debt/mature EBITDA secured against the Group's hotel assets.

 

The Group is currently in advanced discussions in respect of securing new larger debt facilities of up to £33.0 million in aggregate as follows:

1. an extension to the UK corporate five year term facility of a further £10 million; and

2. a new accordion facility of £23.0 million, having received initial credit committee approval by the proposed lender.

 

In addition, the Group intends at a later date to procure a new Euro denominated loan secured against the target development site in Spain (if acquired), with a leverage of between 50% and 60% as is similar to the Barcelona financing arrangements.

 

The Board further expects the investment of new capital in the hotel pipeline to be earnings per share enhancing in the medium term.

6. Details of the Placing

Investec Bank plc ("Investec") is acting as nominated adviser ("NOMAD") and sole broker in connection with the Placing.

The Placing is subject to the terms and conditions set out in the appendix (the "Appendix") to this announcement (which forms part of this announcement, such announcement and the Appendix together being the "Announcement").

Under the terms of the Placing, Investec has placed 45,454,546 Placing Shares at the Placing Price by way of a conditional, non-pre-emptive placing. The Placing Price of 110.0 pence per Placing Share represents a discount of approximately 3.9 per cent. to the closing mid-market price of 114.5 pence per Ordinary Share on 21 February 2018, being the latest practicable date prior to this Announcement. The Placing Shares will represent approximately 31.1 per cent. of the Enlarged Issued Share Capital following Admission. The Placing Shares will be issued credited as fully paid and will be identical to and rank pari passu in all respects with the Existing Ordinary Shares, including the right to receive all future distributions, declared, paid or made in respect of the Ordinary Shares following the date of Admission. The Placing is not being underwritten.

The Board believes that raising equity finance using the flexibility provided by a non-pre-emptive placing is the most appropriate and optimal structure for the Company at this time. This allows both certain existing institutional holders and new institutional investors the opportunity to participate in the Placing.

Application will be made to the London Stock Exchange for the Placing Shares to be admitted to trading on AIM. It is expected that admission to AIM will become effective in respect of, and that dealings on AIM will commence in, the Placing Shares, at 8.00 .a.m. on 13 March 2018.

A circular ("Circular") containing, among other things, the notice of the General Meeting is expected to be published by the Company later today.

easyGroup, currently the Company's largest shareholder, when aggregated with those parties deemed to be acting in concert with it (as disclosed in the Company's 2014 admission document), is interested in 38,549,800 Ordinary Shares, representing approximately 38.4 per cent. of the Existing Ordinary Shares, has indicated that it is supportive of the Placing on the terms set out above. Upon Admission, whilst easyGroup's shareholding will remain unchanged, its percentage interest in the Enlarged Issued Share Capital, when aggregated with those parties deemed to be acting in concert with it, will reduce to approximately 26.4 per cent.

Settlement for the Placing Shares and Admission is expected to take place at 8.00 a.m. on 13 March 2018. Following Admission, the Company will have 145,954,546 Ordinary Shares in issue.

In accordance with the terms of the Placing Agreement, the Placing is conditional upon, amongst other things, the passing of the Resolutions, the Waiver being approved, the conditions in the Placing Agreement being satisfied or (if applicable) waived and the Placing Agreement not having been terminated in accordance with its terms prior to Admission occurring on or before 13 March 2018 (or such later date as the Company and Investec may agree, not being later than 3 April 2018). The Placing Agreement contains customary warranties given by the Company to Investec as to matters relating to the Group and its business and a customary indemnity given by the Company to Investec in respect of liabilities arising out of or in connection with the Placing. Investec is entitled to terminate the Placing Agreement in certain limited circumstances prior to Admission, including circumstances where any of the warranties are found to be materially untrue, inaccurate or misleading or the occurrence of certain force majeure events.

The Placing Shares are not being made available to the public and are not being offered or sold in any jurisdiction where it would be unlawful to do so.

7. ICAMAP participation in the Placing

ICAMAP originally invested in the Company through the placing of new Ordinary Shares undertaken by the Company in October 2016 which was carried out at a premium to the then prevailing share price.

ICAMAP is a Master Holding company of ICAMAP Investors SLP-SIF, a specialised investment fund established under Luxembourg Law as a special limited partnership, authorised and regulated by the CSSF (Local Regulator) and qualifies as an alternative investment fund. ICAMAP Investors SLP-SIF is managed by ICAMAP S.à r.l. acting as general partner of the fund. The latter is authorised and regulated by the CSSF as an Alternative Investment Fund Manager pursuant to the Alternative Investment Fund Manager Directive (AIFMD). ICAMAP S.à r.l. is an independent real estate fund manager with a wealth of expertise in real estate, capital markets and private equity. Its first fund is a €500 million closed-end fund primarily focused on European property companies, which intends to act as a long-term investor alongside shareholders, management teams and other stakeholders.

Pursuant to the Placing, the Company has conditionally placed 26,363,636 Placing Shares at the Placing Price (representing approximately 18.1 per cent. of the Enlarged Issued Share Capital) with ICAMAP.

Relationship Agreement

ICAMAP has entered into a relationship agreement dated 22 February 2018 with the Company (the "Relationship Agreement"), conditional on Admission occurring. The Relationship Agreement is subject to English law and:

a) provides that the Company shall be allowed to operate independently of ICAMAP and its associates,

b) provides that all arrangements between ICAMAP and its associates and the Company will be on arm's length terms and on a normal commercial basis;

c) requires that ICAMAP abstains from doing anything which would result in a member of the Group not being capable of carrying on independent business;

d) confirms that ICAMAP shall not cause the Company to fail to comply or prevent the Company from complying with its AIM and other regulatory obligations;

e) provides that the Company shall reimburse ICAMAP £25,000 (plus any applicable VAT) in respect of its professional fees in connection with the negotiation of the Relationship Agreement and ancillary documents; and

f) provides that ICAMAP and its associates will not propose or vote on a resolution of the Company to cancel the Company's admission to trading on AIM save in certain circumstances including with the consent of the independent Directors (being those Directors who are independent of ICAMAP and its associates) and where such resolution has been proposed by one or more shareholders who are not easyGroup, or related parties of ICAMAP or easyGroup or parties acting in concert with them.

The provisions of this agreement shall cease to have effect on ICAMAP if its total interest in securities in the Company falls below 29.9 per cent. or the share capital of the Company ceases to be admitted to trading on AIM or admitted to the Official List and to trading on the Main Market of the London Stock Exchange.

Pursuant to the Relationship Agreement, ICAMAP has a right to appoint a director to the Board. It is proposed that Hermanus Martinus Maria Meijer (Harm Meijer) will be appointed to the Board as a Non-executive Director upon Admission and will enter into a letter of appointment with the Company upon Admission. The letter of appointment will be in substantively the same form to the letters of appointment of the existing non-executive directors save that Harm Meijer will not receive a fee.

8. Proposed Board Appointment

Pursuant to the provisions of the Relationship Agreement, upon Admission Harm Meijer will join the Board as a non-executive Director.

Harm Meijer (aged 43 years) is a founding partner of ICAMAP and Managing Director of ICAMAP Advisory having spent 19 years working in the equity markets. Harm graduated in econometrics at Rotterdam Erasmus University. He worked at the Amsterdam Exchanges and ABN Amro, before he joined JP Morgan in London in 2005 becoming Managing Director in 2010. Harm was ranked five times best performing sell-side research analyst in the "Extel Survey" and six times in "Institutional Investor". Harm is currently a member of the Supervisory Board of NSI NV and has no past directorships or partnerships within the last five years.

It is proposed that Harm Meijer will enter into a non-executive appointment letter with the Company upon Admission on the following terms:

Name	Position	Effective Date	Annual remuneration (including other benefits)	Compensation on early termination	Notice period
Harm Meijer	Non-executive Director	Admission	None	None	One month's notice

Save as disclosed above, there are no other matters which are required to be disclosed in accordance with Rule 17 and paragraph (g) of Schedule Two of the AIM Rules for Companies in relation to Harm Meijer's appointment as a Non-executive Director.

9. Related Party Transaction

The participation by ICAMAP in the Placing will constitute a related party transaction for the purposes of Rule 13 of the AIM Rules as its subscription for Placing Shares will exceed 5 per cent. in certain of the class tests (as defined in the AIM Rules).

Accordingly, the Directors consider, having consulted with the Company's nominated adviser, Investec, that the terms of the participation by ICAMAP in the Placing are fair and reasonable insofar as Shareholders are concerned.

10. Takeover Code

The participation of ICAMAP in the Placing gives rise to certain considerations under the Takeover Code. Brief details of the Panel, the Takeover Code and the protection they afford are given below.

The Takeover Code is issued and administered by the Panel. The Company is a company to which the Takeover Code applies and, as such, its Shareholders are entitled to the protections afforded by the Takeover Code. The Takeover Code and the Panel operate principally to ensure that the shareholders of a company are treated fairly and are not denied an opportunity to decide on the merits of a takeover. The Takeover Code also provides an orderly framework in which takeovers are conducted.

Under Rule 9, where any person acquires, whether by a series of transactions over a period of time or not, an interest (as defined in the Takeover Code) in shares which (taken together with shares in which he is already interested and in which persons acting in concert with him are interested) carry 30 per cent. or more of the voting rights of a company which is subject to the Takeover Code, that person, and any person acting in concert with him, is normally required by the Panel to make a general offer in cash to all of the remaining shareholders to acquire the remaining shares in that company not held by him and/or his concert party.

Rule 9 further provides that, where any person, together with any persons acting in concert with him, is Interested in shares which, in aggregate, carry not less than 30 per cent. but does not hold shares carrying more than 50 per cent. of a company's voting rights, a general offer will normally be required if any further interest in shares is acquired by any such person, or any person acting in concert with him.

An offer under Rule 9 must be in cash and at the highest price paid by the person required to make the offer, or any persons acting in concert with him, for any interest in shares in the company during the 12 months preceding the date of the announcement of such offer.

Rule 9 of the Takeover Code further provides, amongst other things, that where any person who, together with persons acting in concert with him, holds over 50 per cent. of the voting rights of a company and acquires an interest in shares which carry additional voting rights, then they will not normally be required to make a general offer to the other shareholders to acquire their shares. However, the Panel may deem an obligation to make an offer to have arisen on the acquisition by a single member of a concert party of an interest in shares sufficient to increase his individual holding to 30 per cent. or more of a company's voting rights or, if he already holds more than 30 per cent. but less than 50 per cent. an acquisition which increases his shareholdings in that company.

Under the Takeover Code, a concert party arises where persons acting together pursuant to an agreement or understanding (whether formal or informal), co-operate to obtain or consolidate control, or to frustrate the successful outcome of an offer for a company, subject to the Takeover Code. Control means an interest, or interests, in shares carrying, in aggregate, 30 per cent. or more of the voting rights of a company, irrespective of whether such interest or interests give de facto control.

11. Dispensation from the requirement to make a general offer under the Takeover Code

As at 21 February 2018 (being the latest practicable date prior to publication of this Announcement), ICAMAP has an interest in 30,049,500 Ordinary Shares, representing approximately 29.9 per cent. of the Existing Ordinary Shares.

On completion of the Placing, ICAMAP will be interested in 56,413,136 Ordinary Shares, representing approximately 38.7 per cent. of the Enlarged Issued Share Capital.

As ICAMAP would then be interested in Ordinary Shares carrying between 30 per cent. and 50 per cent. of the voting rights in the Company, ICAMAP could not acquire an interest in any further Shares carrying voting rights in the Company (other than pursuant to the exercise of any existing options or warrants it has) without being subject to the provisions of Rule 9 of the Takeover Code.

Under Note 1 of the Notes on the Dispensations from Rule 9, the Panel may waive the requirement for a general offer to be made in accordance with Rule 9 if, amongst other things, the shareholders of a company who are independent of the person who would otherwise be required to make an offer, and any person acting in concert with him, pass an ordinary resolution on a poll at a general meeting or by way of a written resolution approving such a waiver.

The Panel has agreed, subject to the passing of the Whitewash Resolution by the Independent Shareholders on a poll at the General Meeting, to waive the obligation of ICAMAP to make a mandatory offer for the Ordinary Shares not already owned by it or persons connected with it as would otherwise arise following completion of the Placing. Accordingly, the Company proposes that the Independent Shareholders waive the obligation on the ICAMAP to make a mandatory general offer under Rule 9 which would otherwise arise in the event of the participation in the Placing by ICAMAP.

To be passed, the Whitewash Resolution will require a simple majority of the votes cast on a poll vote. As the Waiver must be approved by the Independent Shareholders, ICAMAP is not able to vote on the Whitewash Resolution. As at 21 February 2018 (being the latest practicable date prior to publication of this Announcement), ICAMAP has an interest in 30,049,500 Ordinary Shares, representing approximately 29.9 per cent. of the Existing Share Capital.

ICAMAP will not be restricted from making a subsequent offer in the future for the Company in the event that the Waiver is approved by Independent Shareholders. However, any further increase in the interests in Ordinary Shares held by ICAMAP will be subject to the provisions of Rule 9.1.

For the avoidance of doubt, the Waiver, which is valid only for so long as the authority granted pursuant to the Waiver Resolution remains in force, applies only in respect of increases in shareholdings of ICAMAP resulting from its participation in the Placing and not in respect of other increases in its holdings.

The Waiver will be invalidated if any purchases of Ordinary Shares are made by ICAMAP in the period between the date of this Announcement and the General Meeting.

12. Independent Advice

Investec has provided advice to the Directors, in accordance with the requirements of paragraph 4(a) of Appendix 1 of the Takeover Code, in relation to the Whitewash Resolution. Such advice was provided by Investec to the Directors of the Company only and, in providing such advice, Investec has taken into account the Directors' commercial assessments.

The Directors, who have been advised by Investec, consider the terms of the Whitewash Resolution and the approval of the Waiver to be fair and reasonable and in the best interests of the Independent Shareholders and the Company as a whole.

13. Directors' participation in the Placing

The following Directors (or members of their immediate families) intend to participate in the Placing and subscribe for the following number of Placing Shares at the Placing Price:

Name	Role	Number of Placing Shares	Ordinary Shares following Placing	Percentage of Enlarged Issued Share Capital
Guy Parsons	Chief Executive	27,273	254,158	0.17%
Marc Vieilledent	Chief Financial Officer	5,000	15,000	0.01%
Jonathan Lane	Non-executive Chairman	47,000	600,000	0.41%
Scott Christie	Non-executive Director	10,000	116,456	0.08%

 

14. General Meeting

The Company has no on-going authority to allot Ordinary Shares. In order to be able to issue and allot the Placing Shares, the Company will seek Shareholder approval at a General Meeting. The Resolutions being proposed are specifically tailored to authorise the issue of the 45,454,546 Placing Shares proposed to be issued pursuant to the Placing.

A General Meeting of the Company, notice of which is set out at the end of the Circular and at which the Resolutions will be proposed, is to be held at the offices of Stephenson Harwood LLP, 1 Finsbury Circus, London EC2M 7SH on 12 March 2018 at 11.00 a.m.. Please note that the summary and explanation set out below is not the full text of the Resolutions and Shareholders should review the full text of the Resolutions before returning their Forms of Proxy.

The business to be considered at the General Meeting is set out in the notice together with the explanatory notes to each resolution below.

The Company is proposing the following Resolutions:

(1) Resolution 1 - an ordinary resolution to be taken on a poll by the Independent Shareholders to waive the obligation on ICAMAP which would otherwise arise under Rule 9 as a result of the participation of ICAMAP in the Placing;

(2) Resolution 2 - an ordinary resolution to be passed by Shareholders to grant authority to the Directors under section 551 of the Act, to allot new Ordinary Shares up to a maximum aggregate nominal amount of £454,545.46 being the amount required for the purposes of issuing the Placing Shares; and

(3) Resolution 3 - a special resolution to be passed by the Shareholders to empower the Directors, pursuant to section 570 of the Act, to allot the Placing Shares on a non-pre-emptive basis.

These authorities will enable the Directors to effect the Placing but will expire if Admission does not take place by 3 April 2018.

If the Resolutions are passed at the General Meeting but the Placing does not complete, the Company undertakes not to exercise the authority given to it by the Resolutions.

15. Recommendation

The Directors, who have been so advised by the Company's Nominated Adviser and Broker, Investec, consider the terms of the Rule 9 Waiver to be fair and reasonable and in the best interests of the Independent Shareholders and of the Company as a whole. Accordingly, the Directors recommend that the Independent Shareholders vote in favour of the Whitewash Resolution at the General Meeting as they have irrevocably undertaken to do in respect of their entire holdings which amount to 470,841 Ordinary Shares, representing approximately 0.47 per cent. of the Existing Ordinary Shares.

In providing advice to the Directors, Investec has relied upon the Directors' commercial assessments.

The Directors consider that the Placing is in the best interests of the Company and Shareholders as a whole. Accordingly, the Directors recommend that the Shareholders vote in favour of Resolutions 2 and 3 at the General Meeting as they have irrevocably undertaken to do in respect of their entire holdings which amount to interests in 470,841 Ordinary Shares, representing approximately 0.47 per cent. of the Existing Ordinary Shares.

 

Expected timetable of principal events

Anticipated date of posting the Circular	22 February 2018
Last time and date for receipt of Forms of Proxy and CREST Proxy Instructions	11.00 a.m. on 8 March 2018
General Meeting	11.00 a.m. on 12 March 2018
Admission and dealings in the Placing Shares expected to commence on AIM	8.00 a.m. on 13 March 2018
Where applicable, expected date for CREST accounts to be credited for Placing Shares in uncertificated form	13 March 2018
Where applicable, expected date for despatch of definitive share certificates in respect of Placing Shares in certificated form	By 23 March 2018

 

 

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 PERSONS: (A) IN MEMBER STATES OF THE EUROPEAN ECONOMIC AREA ("EEA") WHO ARE "QUALIFIED INVESTORS" WITHIN THE MEANING OF ARTICLE 2(1)(E) OF DIRECTIVE 2003/71/EC AS AMENDED, AND TO THE EXTENT IMPLEMENTED IN THE RELEVANT MEMBER STATE ("PROSPECTUS DIRECTIVE") ("QUALIFIED INVESTORS"); (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"); OR (II) ARE PERSONS FALLING WITHIN ARTICLE 49(2)(A) TO (D) (HIGH NET WORTH COMPANIES, UNINCORPORATED ASSOCIATIONS, ETC.) OF THE ORDER; AND (C) TO WHOM IT MAY OTHERWISE BE LAWFULLY BE COMMUNICATED WITHOUT ANY FURTHER ACTION BY THE COMPANY, INVESTEC OR THEIR REPRESENTATIVES (ALL SUCH PERSONS IN (A), (B), (C) 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 EASYHOTEL 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, Investec Bank plc ("Investec") or any of their respective affiliates, agents, directors, officers or employees ("Representatives") 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 (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 represents, warrants, undertakes, agrees and acknowledges (amongst other things) to the Company and Investec that:

(1) it is a Relevant Person 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;

(2) in the case of a Relevant Person in a member state of the EEA which has implemented the Prospectus Directive (each, a "Relevant Member State") who acquires any Placing Shares pursuant to the Placing:

a) it is a Qualified Investor within the meaning of Article 2(1)(e) of the Prospectus Directive; andb) in the case of any Placing Shares acquired by it as a financial intermediary, as that term is used in Article 3(2) of the Prospectus Directive:(i) the Placing Shares acquired by it in the Placing have not been acquired on behalf of, nor have they been acquired with a view to their offer or resale to, persons in any Relevant Member State other than Qualified Investors or in circumstances in which the prior consent of Investec has been given to the offer or resale; or(ii) where Placing Shares have been acquired by it on behalf of persons in any member state of the EEA other than Qualified Investors, the offer of those Placing Shares to it is not treated under the Prospectus Directive as having been made to such persons; and(3) it is acquiring the Placing Shares for its own account or is acquiring the Placing Shares for an account with respect to which it exercises sole investment discretion and has the authority to make and does make the representations, warranties, indemnities, acknowledgements, undertakings and agreements contained in this Announcement; and(4) it understands (or if acting for the account of another person, such person has confirmed that such person understands) the resale and transfer restrictions set out in this Appendix; and(5) except as otherwise permitted by the Company and subject to any available exemptions from applicable securities laws, it (and any account referred to in paragraph 3 above) is outside the United States acquiring the Placing Shares in offshore transactions as defined in and in accordance with Regulation S under the Securities Act.

No prospectus

No prospectus, admission document 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 contract note 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 Investec, the Company or any other person and none of Investec, 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. Nothing in this paragraph shall exclude the liability of any person for fraudulent misrepresentation.

Details of the Placing Agreement and the Placing Shares

Investec 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, Investec, 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 Ordinary Shares after the date of issue of the Placing Shares.

As part of the Placing, the Company has agreed that it will not for a period of 90 days after Admission, offer, issue, sell, contract to sell, issue options in respect of or otherwise dispose of any securities of the Company (or any interest therein or in respect thereof) or any other securities exchangeable for, or convertible into, or substantially similar to, Ordinary Shares or enter into any transaction having substantially the same effect or agree to do any of the foregoing other than with the prior written consent of Investec (such consent not to be unreasonably withheld or delayed).

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 13 March 2018 and that dealings in the Placing Shares on AIM will commence at the same time.

Principal terms of the Placing

1. Investec is acting as nominated adviser and broker to the Placing, as agent for and on behalf of the Company. Investec is authorised in the United Kingdom by the Prudential Regulation Authority ("PRA") and regulated by the Financial Conduct Authority ("FCA") and the PRA, is acting exclusively for the Company and no one else in connection with the matters referred to in this Announcement and will not be responsible to anyone other than the Company for providing the protections afforded to the customers of Investec or for providing advice in relation to the matters described in this Announcement. 

2. Participation in the Placing will only be available to persons who may lawfully be, and are, invited by Investec to participate. Investec and any of its respective affiliates are entitled to participate in the Placing as principal.

3. The price per Placing Share (the "Placing Price") is fixed at 110.0 pence and is payable to Investec by all Placees.

4. Each Placee's allocation is determined by Investec in its discretion following consultation with the Company and has been or will be confirmed orally by Investec and a contract note will be dispatched as soon as possible thereafter. That oral confirmation will give rise to an irrevocable, legally binding commitment by that person (who at that point becomes a Placee), in favour of Investec and the Company, under which it agrees to acquire the number of Placing Shares allocated to the Placee at the Placing Price and otherwise on the terms and subject to the conditions set out in this Appendix and in accordance with the Company's articles of association. Except with Investec's consent, such commitment will not be capable of variation or revocation at the time at which it is submitted.

5. Each Placee's allocation and commitment will be evidenced by a contract note issued to such Placee by Investec. The terms of this Appendix will be deemed incorporated in that contract note.

6. Each Placee will have an immediate, separate, irrevocable and binding obligation, owed to Investec (as agent for the Company), to pay to it (or as it may direct) in cleared funds an amount equal to the product of the Placing Price and the number of Placing Shares such Placee has agreed to acquire and the Company has agreed to allot and issue to that Placee.

7. Irrespective of the time at which a Placee's allocation(s) pursuant to the Placing is/are confirmed, settlement for all Placing Shares to be acquired pursuant to the Placing will be required to be made at the same time, on the basis explained below under "Registration and Settlement".

8. All obligations of Investec under the Placing will be subject to fulfilment (or waiver, as applicable) of the conditions referred to below under "Conditions of the Placing" and to the Placing not being terminated on the basis referred to below under "Termination of the Placing".

9. By participating in the Placing, each Placee agrees that its rights and obligations in respect of the Placing will terminate only in the circumstances described below and will not be capable of rescission or termination by the Placee.

10. To the fullest extent permissible by law and applicable FCA rules, none of (a) Investec, (b) any of Investec's Representatives (c) to the extent not contained within (a) or (b), any person connected with Investec as defined in FSMA ((b) and (c) being together "affiliates" and individually an "affiliate" of Investec), (d) any person acting on Investec 's behalf, shall have any liability (including to the extent permissible by law, any fiduciary duties) to Placees or to any other person whether acting on behalf of a Placee or otherwise. In particular, neither Investec nor any of its respective affiliates shall have any liability (including, to the extent permissible by law, any fiduciary duties) in respect of their conduct of the Placing or of such alternative method of effecting the Placing as Investec and the Company may agree.

11. Each Placee acknowledges and agrees that the Company is responsible for the allotment of the Placing Shares to the Placees and Investec shall have no liability to the Placees for the failure of the Company to fulfil those obligations.

Registration and Settlement

If Placees are allocated any Placing Shares in the Placing they will be sent a contract note or electronic confirmation by Investec, 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 Investec.

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 Investec in accordance with either the standing CREST or certificated settlement instructions which they have in place with Investec.

Settlement of transactions in the Placing Shares (ISIN: GB00BN56KF84) following Admission will take place within the CREST system, subject to certain exceptions. Settlement through CREST is expected to take place on 13 March 2018 unless otherwise notified by Investec and Admission is expected to occur no later than 8.00 a.m. on 13 March 2018 unless otherwise notified by Investec. Admission and Settlement may occur at an earlier date, which if achievable, will be set out in the Circular. 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 Investec may agree that the Placing Shares should be issued in certificated form. Investec 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 Investec.

Each Placee is deemed to agree that if it does not comply with these obligations, Investec may sell any or all of their Placing Shares on their behalf and retain from the proceeds, for Investec's own account and benefit, an amount equal to the aggregate amount owed by the Placee plus any interest due. The relevant Placee will, however, remain liable and shall indemnify Investec on demand 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.

If Placing Shares are to be delivered to a custodian or settlement agent, Placees must ensure that, upon receipt, the conditional contract note 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 and not having been terminated in accordance with its terms. The obligations of Investec under the Placing Agreement are, and the Placing is, conditional upon, inter alia:

(a) the passing of the Resolutions at the General Meeting, without any amendments not approved by Investec in writing;(b) the warranties on the part of the Company contained in the Placing Agreement being true and accurate in all material respects and not misleading on and as of the date of the Placing Agreement and on Admission, as though they had been given and made on such dates by reference to the facts and circumstances then subsisting;(c) the performance by the Company of its obligations under the Placing Agreement so far as the same fall to be performed prior to Admission;(d) no matter having arisen before Admission which might reasonably be expected to give rise to an indemnity claim under the Placing Agreement;(e) in the opinion of Investec, acting in good faith, there shall have been no material adverse change since the date of the Placing Agreement (whether or not foreseeable at the date of the Placing Agreement) before Admission;

(f) the relationship agreement between the Company and ICAMAP: (i) having been entered into and becoming and continuing to be enforceable against each of the parties thereto (subject only to Admission) in accordance with its terms; and (ii) not having been varied, supplemented, rescinded or terminated (in whole or in part) prior to Admission;

(g) the proposed waiver by the Takeover Panel of the obligation of ICAMAP to make a general offer under Rule 9 of the Takeover Code which would otherwise arise as a consequence of the Placing (the " Waiver"), having been granted and not revoked by the Takeover Panel (conditional only on approval by the Independent Shareholders by the passing of the Whitewash Resolution); and(h) Admission occurring not later than 8.00 a.m. on 13 March 2018,

(all conditions to the obligations of Investec included in the Placing Agreement being together, the "conditions").

If any of the conditions set out in the Placing Agreement are not fulfilled 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 Investec may agree, provided that the time for satisfaction of the condition set out in (h) above shall not be extended beyond 8.00 a.m. on 3 April 2018), or 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 Investec, in its absolute discretion by notice in writing to the Company and Investec 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.

Investec may terminate the Placing Agreement in certain circumstances, details of which are set out below.

Neither Investec, the Company nor any of their respective Representatives 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 Investec.

Termination of the Placing

Investec may terminate the Placing Agreement, in accordance with its terms, at any time prior to Admission if, inter alia:

1. it comes to the knowledge of Investec that, in its opinion, any of the warranties were materially untrue, inaccurate or misleading; or

2. it comes to the notice of Investec that, in its opinion, any statement contained in this Announcement, or any other document or announcement issued or published by or on behalf of the Company in connection with the Placing, is or has become materially, untrue, incorrect or misleading; or

3. the Company shall fail to comply, in any respect which Investec in its opinion believes is material, with any of its obligations under the Placing Agreement;

4. a force majeure event has occurred, or any material adverse change has occurred in the financial position, prospects or business of the Company and its subsidiary undertakings (taken as whole) which, in the opinion of Investec, would materially prejudice the success of the Placing or the distribution of the Placing Shares, or

5. in the opinion of Investec, a material adverse change in relation to the Company or the Group has occurred.

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 Investec that the exercise by the Company or Investec 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 Investec and that neither of the Company nor Investec need make any reference to such Placee and that neither Investec, the Company, nor any of their respective Representatives 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 Investec of a contract note 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) to the Company and Investec that (save where Investec expressly agrees in writing to the contrary):

1. it has read and understood this Announcement in its entirety and that its acquisition of the Placing Shares is subject to and based upon all the terms, conditions, representations, warranties, indemnities, acknowledgements, agreements and undertakings and other information contained herein and that it has not relied on, and will not rely on, any information given or any representations, warranties or statements made at any time by any person in connection with Admission, the Placing, the Company, the Placing Shares or otherwise, other than the information contained in this Announcement and the Publicly Available Information;

2. it has not received a prospectus, admission document or other offering document in connection with the Placing and acknowledges that no prospectus, admission document or other offering document: (a) is required under the Prospectus Directive; and (b) has been or will be prepared in connection with the Placing;

3. the Ordinary Shares are admitted to trading on AIM, and that the Company is therefore required to publish certain business and financial information in accordance with the AIM Rules, which includes a description of the nature of the Company's business and the Company's most recent balance sheet and profit and loss account and that it is able to obtain or access such information without undue difficulty, and is able to obtain access to such information or comparable information concerning any other publicly traded company, without undue difficulty;

4. it has made its own assessment of the Placing Shares and has relied on its own investigation of the business, financial or other position of the Company in accepting a participation in the Placing and neither Investec, the Company nor any of their respective Representatives or any person acting on behalf of any of them has provided, and will not provide, it with any material regarding the Placing Shares or the Company or any other person other than the information in this Announcement, or the Publicly Available Information; nor has it requested neither of Investec, the Company, any of their respective Representatives or any person acting on behalf of any of them to provide it with any such information;

5. neither Investec, any person acting on behalf of them or any of their respective Representatives has or shall have any liability for any Publicly Available Information, or any representation relating to the Company, provided that nothing in this paragraph excludes the liability of any person for fraudulent misrepresentation made by that person;

6. the only information on which it is entitled to rely on and on which it has relied in committing to subscribe for the Placing Shares is contained in the Publicly Available Information, such information being all that it deems necessary to make an investment decision in respect of the Placing Shares and it has made its own assessment of the Company, the Placing Shares and the terms of the Placing based on Publicly Available Information; neither Investec, the Company nor any of their respective Representatives has made any representation or warranty to it, express or implied, with respect to the Company, the Placing or the Placing Shares or the accuracy, completeness or adequacy of the Publicly Available Information; it has conducted its own investigation of the Company, the Placing and the Placing Shares, satisfied itself that the information is still current and relied on that investigation for the purposes of its decision to participate in the Placing; and has not relied on any investigation that Investec or any person acting on its behalf may have conducted with respect to the Company, the Placing or the Placing Shares;

7. the content of this Announcement and the Publicly Available Information has been prepared by and is exclusively the responsibility of the Company and that neither Investec nor any persons acting on its behalf is responsible for or has or shall have any liability for any information, representation, warranty or statement relating to the Company contained in this Announcement or the Publicly Available Information nor will they be liable for any Placee's decision to participate in the Placing based on any information, representation, warranty or statement contained in this Announcement, the Publicly Available Information or otherwise, and that where any such liability nevertheless arises as a matter of law, it will immediately waive any claim against Investec and any of its Representatives which it may have in respect thereof. Nothing in this Appendix shall exclude any liability of any person for fraudulent misrepresentation;

8. the Placing Shares have not been registered or otherwise qualified, and will not be registered or otherwise qualified, for offer and sale nor will a prospectus be cleared or approved in respect of any of the Placing Shares under the securities laws of the United States, or any state or other jurisdiction of the United States, Australia, Canada, Republic of South Africa or Japan and, subject to certain exceptions, may not be offered, sold, taken up, renounced or delivered or transferred, directly or indirectly, within the United States, Australia, Canada, South Africa or Japan or in any country or jurisdiction where any such action for that purpose is required;

9. it and/or each person on whose behalf it is participating:

a) is entitled to acquire Placing Shares pursuant to the Placing under the laws and regulations of all relevant jurisdictions;b) has fully observed such laws and regulations;c) has capacity and authority and is entitled to enter into and perform its obligations as an acquirer of Placing Shares and will honour such obligations; andd) has obtained all necessary governmental and other consents, guarantees, permits, approvals and authorities (including, without limitation, in the case of a person acting on behalf of a Placee, all necessary consents and authorities to agree to the terms set out or referred to in this Appendix) under those laws or otherwise and complied with all necessary formalities to enable it to enter into the transactions contemplated hereby and to perform its obligations in relation thereto and that it has not taken any action or omitted to take any action which will or may result in Investec, the Company or any of their respective Representatives acting in breach of the legal or regulatory requirements of any jurisdiction in connection with the Placing and, in particular, if it is a pension fund or investment company it is aware of and acknowledges it is required to comply with all applicable laws and regulations with respect to its subscription for Placing Shares;

10. it is not, and any person who it is acting on behalf of is not, and at the time the Placing Shares are subscribed will not be, a resident of, or with an address in, or subject to the laws of, Australia, Canada, Japan or the Republic of South Africa, and it acknowledges and agrees that the Placing Shares have not been and will not be registered or otherwise qualified under the securities legislation of Australia, Canada, Japan or the Republic of South Africa and may not be offered, sold, or acquired, directly or indirectly, within those jurisdictions;

11. the Placing Shares have not been, and will not be, registered under the Securities Act and may not be offered, sold or resold in or into or from the United States except pursuant to an effective registration under the Securities Act, or pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act and in accordance with applicable state securities laws; and no representation is being made as to the availability of any exemption under the Securities Act for the reoffer, resale, pledge or transfer of the Placing Shares;

12. it and the beneficial owner of the Placing Shares is, and at the time the Placing Shares are acquired will be, outside the United States and acquiring the Placing Shares in an "offshore transaction" as defined in, and in accordance with, Regulation S under the Securities Act;

13. it (and any account for which it is purchasing) is not acquiring the Placing Shares with a view to any offer, sale or distribution thereof within the meaning of the Securities Act;

14. it will not distribute, forward, transfer or otherwise transmit this Announcement or any part of it, or any other presentational or other materials concerning the Placing in or into or from the United States (including electronic copies thereof) to any person, and it has not distributed, forwarded, transferred or otherwise transmitted any such materials to any person;

15. neither Investec, its respective Representatives nor any person acting on behalf of any of them is making any recommendations to it, advising it regarding the suitability of any transactions it may enter into in connection with the Placing and that participation in the Placing is on the basis that it is not and will not be a client of Investec and Investec has no duties or responsibilities to it for providing the protections afforded to its clients or for providing advice in relation to the Placing nor in respect of any representations, warranties, undertakings or indemnities contained in the Placing Agreement nor for the exercise or performance of any of its rights and obligations thereunder including any rights to waive or vary any conditions or exercise any termination right;

16. it acknowledges and agrees that the good faith exercise or non-exercise by Investec of any right of termination under the Placing Agreement shall be at the absolute discretion of Investec, with no requirement to reference or consult with it and Investec shall have no liability to it in connection with the good faith exercise or non-exercise of such termination right;

17. it has the funds available to pay for the Placing Shares for which it has agreed to subscribe and acknowledges and undertakes that it will make payment to Investec for the Placing Shares allocated to it in accordance with the terms and conditions of this Announcement on the due times and dates set out in this Announcement, failing which the relevant Placing Shares may be placed with others on such terms as Investec may, in its absolute discretion determine without liability to the Placee and it will remain liable, and indemnify Investec, for any shortfall below the net proceeds of such sale and the placing proceeds of such Placing Shares and may be required to bear any stamp duty or stamp duty reserve tax (together with any interest or penalties due pursuant to the terms set out or referred to in this Announcement) which may arise upon the sale of such Placee's Placing Shares on its behalf;

18. no action has been or will be taken by any of the Company, Investec or any person acting on their behalf that would, or is intended to, permit a public offer of the Placing Shares in the United States or in any country or jurisdiction where any such action for that purpose is required;

19. the person who it specifies for registration as holder of the Placing Shares will be: (a) the Placee; or (b) a nominee of the Placee, as the case may be. Neither Investec nor the Company will be responsible for any liability to stamp duty or stamp duty reserve tax resulting from a failure to observe this requirement. Each Placee and any person acting on behalf of such Placee agrees to acquire Placing Shares pursuant to the Placing and agrees to pay the Company and Investec in respect of the same (including any interest or penalties) on the basis that the Placing Shares will be allotted to a CREST stock account of Investec or transferred to a CREST stock account of Investec who will hold them as nominee on behalf of the Placee until settlement in accordance with its standing settlement instructions with it;

20. it is acting as principal only in respect of the Placing or, if it is acting for any other person, (a) it is duly authorised to do so and has full power to make the acknowledgments, representations and agreements herein on behalf of each such person and (b) it is and will remain liable to the Company and Investec for the performance of all its obligations as a Placee in respect of the Placing (regardless of the fact that it is acting for another person);

21. the allocation, allotment, issue and delivery to it, or the person specified by it for registration as holder, of Placing Shares will not give rise to a stamp duty or stamp duty reserve tax liability under (or at a rate determined under) any of sections 67, 70, 93 or 96 of the Finance Act 1986 (depository receipts and clearance services) and that it is not participating in the Placing as nominee or agent for any person or persons to whom the allocation, allotment, issue or delivery of Placing Shares would give rise to such a liability;

22. it will not make an offer to the public of the Placing Shares and it has not offered or sold and will not offer or sell any Placing Shares to persons in the United Kingdom or elsewhere in the EEA prior to the expiry of a period of six months from Admission except to persons whose ordinary activities involve them in acquiring, holding, managing or disposing of investments (as principal or agent) for the purposes of their business or otherwise in circumstances which have not resulted and which will not result in an offer to the public in the United Kingdom within the meaning of section 85(1) of the FSMA or an offer to the public in any other member state of the EEA within the meaning of the Prospectus Directive;

23. it is a person: (a) if in the United Kingdom, that falls within Article 19(5) (Investment Professionals) and/or 49(2) (High net worth companies etc.) of the Order; and (b) if in a member state of the EEA, that is a Qualified Investor. For such purposes, it undertakes that it will acquire, hold, manage and (if applicable) dispose of any Placing Shares that are allocated to it for the purposes of its business only;

24. it has only communicated or caused to be communicated and it will only communicate or cause to be communicated any invitation or inducement to engage in investment activity (within the meaning of section 21 of the FSMA) relating to Placing Shares in circumstances in which section 21(1) of the FSMA does not require approval of the communication by an authorised person and it acknowledges and agrees that Investec has not approved this Announcement in its capacity as authorised persons under section 21 of FSMA and it may not therefore be subject to the controls which would apply if it was made or approved as financial promotion by an authorised person;

25. it has complied and it will comply with all applicable laws with respect to anything done by it or on its behalf in relation to the Placing Shares (including all relevant provisions of the FSMA in respect of anything done in, from or otherwise involving the United Kingdom);

26. represents and warrants that, if it is a financial intermediary, as that term is used in Article 3(2) of the Prospectus Directive (including any relevant implementing measure in any member state), the Placing Shares acquired by it in the Placing will not be acquired on a non-discretionary basis on behalf of, nor will they be acquired with a view to their offer or resale to, persons in a member state of the EEA which has implemented the Prospectus Directive other than Qualified Investors, or in circumstances in which the express prior written consent of Investec has been given to the offer or resale;

27. neither Investec, any of its respective Representatives or any person acting on behalf of any of them has or shall have any liability for any information, representation or statement contained in this Announcement or for any information previously published by or on behalf of the Company or any other written or oral information made available to or publicly available or filed information or any representation, warranty or undertaking relating to the Company, and will not be liable for its decision to participate in the Placing based on any information, representation, warranty or statement contained in this Announcement or elsewhere, provided that nothing in this paragraph shall exclude any liability of any person for fraud;

28. acknowledges and accepts that Investec may, in accordance with applicable legal and regulatory provisions, engage in transactions in relation to the Placing Shares and/or related instruments for their own account for the purpose of hedging their underwriting exposure or otherwise and, except as required by applicable law or regulation, Investec will not make any public disclosure in relation to such transactions;

29. Investec and each of its affiliates, each acting as an investor for its or their own account(s), may bid or subscribe for and/or purchase Placing Shares and, in that capacity, may retain, purchase, offer to sell or otherwise deal for its or their own account(s) in the Placing Shares, any other securities of the Company or other related investments in connection with the Placing or otherwise. Accordingly, references in this Announcement to the Placing Shares being offered, subscribed, acquired or otherwise dealt with should be read as including any offer to, or subscription, acquisition or dealing by Investec and/or any of its respective affiliates, acting as an investor for its or their own account(s). Neither Investec nor the Company intend to disclose the extent of any such investment or transaction otherwise than in accordance with any legal or regulatory obligation to do so;

30. it has complied with its obligations in connection with money laundering and terrorist financing under the Proceeds of Crime Act 2002, the Terrorism Act 2000, the Terrorism Act 2006 and the Money Laundering Regulations 2007 (together, the "Regulations") and undertakes to provide satisfactory evidence of its identity within such reasonable time (in each case to be determined in the absolute discretion of Investec) to ensure compliance therewith and, if making payment on behalf of a third party, that satisfactory evidence has been obtained and recorded by it to verify the identity of the third party as required by the Regulations;

31. it is aware of the obligations regarding insider dealing in the Criminal Justice Act 1993 and the Market Abuse Regulation (596/2014)("MAR") and confirms that it has and will continue to comply with those obligations;

32. in order to ensure compliance with the Money Laundering Regulations 2007, Investec (for itself and as agent on behalf of the Company) or the Company's registrars may, in their absolute discretion, require verification of its identity and it will provide promptly to Investec such evidence, if any, as to the identity or location or legal status of any person which Investec may request from it in connection with the Placing in the form and manner requested by Investec. Pending the provision to Investec's or the Company's registrars, as applicable, of evidence of identity, definitive certificates in respect of the Placing Shares may be retained at Investec's absolute discretion or, where appropriate, delivery of the Placing Shares to it in uncertificated form may be delayed at Investec's or the Company's registrars', as the case may be, absolute discretion. If within a reasonable time after a request for verification of identity Investec's (for itself and as agent on behalf of the Company) or the Company's registrars have not received evidence satisfactory to them, Investec and/or the Company may, at its absolute discretion, terminate its commitment in respect of the Placing, in which event the monies payable on acceptance of allotment will, if already paid, be returned without interest to the account of the drawee's bank from which they were originally debited;

33. except as set out in clause 34 below, it has neither received nor relied on any 'inside information' (for the purposes of MAR and section 56 of the Criminal Justice Act 1993) concerning the Company prior to or in connection with accepting the invitation to participate in the Placing and is not purchasing Placing Shares on the basis of material non-public information;

34. if it has received any 'inside information' (for the purposes of MAR and section 56 of the Criminal Justice Act 1993) in relation to the Company and its securities, it confirms that it has received such information within the market soundings regime provided for in article 11 of MAR and associated delegated regulations and it has not: (i) dealt (or attempted to deal) in the securities of the Company; (ii) encouraged, recommended or induced another person to deal in the securities of the Company; or (iii) unlawfully disclosed inside information to any person, prior to the information being made publicly available;

35. acknowledges that its commitment to acquire Placing Shares on the terms set out in this Announcement and in the contract note will continue notwithstanding any amendment that may in future be made to the terms and conditions of the Placing and that Placees will have no right to be consulted or require that their consent be obtained with respect to the Company's or Investec's conduct of the Placing;

36. it has knowledge and experience in financial, business and international investment matters as is required to evaluate the merits and risks of subscribing for the Placing Shares. It further acknowledges that it is experienced in investing in securities of this nature and is aware that it may be required to bear, and is able to bear, the economic risk of, and is able to sustain, a complete loss in connection with the Placing. It has relied upon its own examination and due diligence of the Company and its affiliates taken as a whole, and the terms of the Placing, including the merits and risks involved;

37. it irrevocably appoints any duly authorised officer of Investec as its agent for the purpose of executing and delivering to the Company and/or its registrars any documents on its behalf necessary to enable it to be registered as the holder of any of the Placing Shares for which it agrees to subscribe or purchase upon the terms of this Announcement;

38. the Company, Investec and others (including each of their respective Representatives) will rely upon the truth and accuracy of the foregoing representations, warranties, acknowledgements and agreements, which are given to Investec, on their own behalf and on behalf of the Company and are irrevocable;

39. if it is acquiring the Placing Shares as a fiduciary or agent for one or more investor accounts, it has full power and authority to make, and does make, the foregoing representations, warranties, acknowledgements, agreements and undertakings on behalf of each such accounts;

40. subject to the Waiver being granted and the Resolutions being passed at the General Meeting, its participation in the Placing will not give rise to an offer being required to be made by it or any person with whom it is acting in concert pursuant to Rule 9 of the Takeover Code;

41. time is of the essence as regards its obligations under this Appendix;

42. any document that is to be sent to it in connection with the Placing will be sent at its risk and may be sent to it at any address provided by it to Investec;

43. the Placing Shares will be issued subject to the terms and conditions of this Appendix, and

44. these terms and conditions in this Appendix and all documents into which this Appendix is incorporated by reference or otherwise validly forms a part and/or any agreements entered into pursuant to these terms and conditions and all agreements to acquire shares pursuant to the Placing will be governed by and construed in accordance with English law and it submits to the exclusive jurisdiction of the English courts in relation to any claim, dispute or matter arising out of any such contract, except that enforcement proceedings in respect of the obligation to make payment for the Placing Shares (together with any interest chargeable thereon) may be taken by the Company or Investec in any jurisdiction in which the relevant Placee is incorporated or in which any of its securities have a quotation on a recognised stock exchange.

By participating in the Placing, each Placee (and any person acting on such Placee's behalf) agrees to indemnify and hold the Company, Investec and each of their respective Representatives 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 Investec, the Company or each of their respective Representatives 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 Investec 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 Investec 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 Investec in the event that either the Company and/or Investec has incurred any such liability to such taxes or duties.

The representations, warranties, acknowledgements and undertakings contained in this Appendix are given to Investec for itself and on behalf of the Company and are irrevocable.

Each Placee and any person acting on behalf of the Placee acknowledges that Investec 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.

A person who is not a party to any agreement to acquire shares pursuant to the Placing has no right under the Contracts (Rights of Third Parties) Act 1999 to rely on or enforce any term of this Announcement but this does not affect any right or remedy of a third party which exists or is available apart from that Act.

Each Placee and any person acting on behalf of the Placee acknowledges and agrees that Investec may (at its absolute discretion) satisfy their 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.

When a Placee or any person acting on behalf of the Placee is dealing with Investec, any money held in an account with Investec 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 Investec'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 and the Placee will rank only as a general creditor of Investec.

The rights and remedies of Investec and the Company 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.

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.

 

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