14 Jul 2010 07:00
NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, DIRECTLY OR INDIRECTLY, TO US PERSONS OR INTO THE UNITED STATES, OR INTO OR FROM CANADA, JAPAN, SOUTH AFRICA OR AUSTRALIA
For immediate release 14 July 2010
LXB RETAIL PROPERTIES PLC
("LXB Retail" or the "Company")
CONDITIONAL PLACING TO RAISE APPROXIMATELY £40 MILLION
Introduction
LXB Retail, the Jersey based closed end real estate investment company, is pleased to announce its intention to raise approximately £40 million before expenses by means of a placing at a price of 96 pence per share with certain institutional investors, and certain Directors and members of the LXB Manager team. The Placing is not underwritten.
The net proceeds of the Placing will enable the Company to continue its strategy as it looks to take advantage of new investment opportunities in existing and new locations as they arise.
Further details of the Placing are set out below and in Annex I (Terms and Conditions) to this Announcement. Defined terms used in this Announcement are set out in Annex II (Definitions) to this Announcement.
Background to and reasons for the Placing
LXB Retail invests primarily in UK out of town and edge of town retail property. Since launching on AIM and the CISX last October, the Group has acquired a number of sites in two locations, Greenwich and Biggleswade, which the Directors believe offer the potential for significant value enhancement for Shareholders. Discussions have commenced with local authorities with regards to planning at both sites, and further announcements will be made when appropriate.
Following the most recent acquisitions at Greenwich (which were announced on 28 June 2010), the Group has now committed over 85 per cent. of the funds raised in the Company's initial placing and admission to AIM and the CISX on 20 October 2009. LXB Manager continues to see new opportunities which offer the potential to create value for Shareholders, and the purpose of the Placing is to raise additional funds in order that those opportunities may be pursued and, where considered appropriate, acquisitions made.
LXB Manager is currently looking at several opportunities across existing and new locations, including a retail park redevelopment on the south coast of England and a major redevelopment in the Midlands. The initial purchase prices of these assets vary from below £10 million to approximately £30 million. Some of these opportunities are at a more advanced stage than others, with discussions already taking place with potential retail tenants and draft heads of terms agreed or contracts being negotiated. However, any future acquisition would be subject to final contracts being entered into, and there can be no certainty that any of the current opportunities being evaluated by LXB Manager will result in acquisitions taking place. Furthermore, all acquisitions are subject to approval by the Fund's investment committee in accordance with the committee's terms of reference (as outlined in the Admission Document).
Details of the Placing
The Company proposes to raise approximately £40 million (before expenses) through the issue of the Placing Shares at 96 pence per share. The Placing will be on a non pre-emptive basis.
The Placing will be conducted in accordance with the terms and conditions set out in Annex I to this Announcement. The Placing will be effected by way of an accelerated bookbuilding to be managed by J.P. Morgan Cazenove and Oriel Securities (together, the "Bookrunners"). The book will open with immediate effect. The timing of the closing of the book and allocations is at the absolute discretion of the Bookrunners. The number of Placing Shares will be agreed by the Company with the Bookrunners at the close of the accelerated bookbuilding period and announced as soon as practicable afterwards.
The Placing Price of 96 pence per Placing Share represents a premium of approximately 8.8 per cent. to the closing middle market quotation of a Share on 13 July 2010 (being the last practicable dealing day prior to the release of this Announcement).
The Placing is conditional upon, amongst other things, passing of all the Resolutions at the Extraordinary General Meeting expected to be held on 2 August 2010, Admission becoming effective by no later than 8.00 a.m. on 3 August 2010 (or such later time and date, not being later than 10 August 2010, as the Company may agree with the Bookrunners) and the Placing Agreement becoming unconditional and not being terminated prior to Admission in accordance with its terms.
Application will be made to the London Stock Exchange for the Placing Shares to be admitted to trading on AIM. Application will also be made to the CISX for the Placing Shares to be admitted to listing on the Daily Official List of the CISX. It is expected that Admission will take place at 8.00 a.m. on 3 August 2010 and that dealings in the Placing Shares on AIM and on the CISX will commence at that time.
Further details of the Placing are set out below and in Annex I (Terms and Conditions) to this Announcement.
Phil Wrigley, Chairman of LXB Retail, commented:
"On behalf of the Board, I am delighted to announce this intended fundraising. Since the initial placing and admission of LXB Retail in October 2009, we have already successfully invested 85 per cent. of the money raised at that time on acquisitions at Greenwich and Biggleswade. The Directors believe that these investments, which are in line with our stated investment policy, offer the potential for significant value enhancement for our Shareholders.
"The Placing will enable us to continue to pursue our strategy as we look to take advantage of further investment opportunities available. I am pleased with the continued support shown by our Shareholders, and we look forward to the future with confidence."
Enquiries
LXB Manager LLP Tel: 020 7432 7900
Tim Walton, CEO
Brendan O'Grady, FD
J.P. Morgan Cazenove (NOMAD, Joint Broker and Joint Bookrunner) Tel: 020 7588 2828
Robert Fowlds / Bronson Albery / Barry Meyers
Oriel Securities (Joint Broker and Joint Bookrunner) Tel: 020 7710 7600
Mark Young / Tom Durie / James Nevin
Buchanan Communications Tel: 020 7466 5000
Charles Ryland / Nicola Cronk / George Prassas
Important Information
This Announcement is not for publication, release or distribution, directly or indirectly, in whole or in part, to US Persons or in or into the United States (including its territories and possessions, any State of the United States and the District of Columbia), Australia, Canada, South Africa or Japan or any jurisdiction into which the same would be unlawful.
This Announcement is for information purposes only and does not constitute, or form part of, any offer to sell or issue or any solicitation of an offer to purchase or subscribe for Placing Shares or other securities in the capital of the Company in Australia, Canada, South Africa or Japan or in any jurisdiction in which such offer or solicitation is or may be unlawful and should not be relied upon in connection with any decision to acquire the Placing Shares or other securities in the capital of the Company. No public offer of securities of the Company is being made in the United Kingdom or elsewhere.
This Announcement is not an offer of securities for sale in or into the United States. The Placing Shares have not been and will not be registered under the Securities Act or under the laws of any State of the United States and may not be offered or sold in or into the United States or to, or for the account or benefit of, US persons except pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act. No public offering of securities will be made in the United States. The Placing Shares are being offered and sold outside the United States in reliance of Regulation S of the Securities Act, and within United States pursuant to an exemption from the registration requirements of the Securities Act.
The Company has not been, and will not be, registered under the Investment Company Act, in reliance of Section 3(c)(7) thereof, and investors will not be entitled to the benefits of that Act. Accordingly, Placing Shares are only being offered to US Persons that are qualified institutional buyers (as defined in Rule 144A under the Securities Act), and are also qualified purchasers (as defined in Section 2(a)(51) of the Investment Company Act).
Prospective investors should note that, except with the express consent of the Company given in respect of an investment in the Placing, the Placing Shares may not be acquired by investors using assets of (i) an employee benefit plan that is subject to the fiduciary responsibility or prohibited transaction provisions of Title I of the ERISA, (including, as applicable, assets of an insurance company general account) or a plan that is subject to the prohibited transaction provisions of Section 4975 of the Code, (including an individual retirement account), (ii) an entity whose underlying assets include "plan assets" by reason of a plan's investment in the entity, (iii) a "benefit plan investor" as otherwise defined in Section 3(42) of the ERISA or regulations promulgated by the US Department of Labor or (iv) a plan, individual retirement account or other arrangement that is subject to any Similar Law. Violation of these restrictions could result in mandatory transfer of Shares.
In the United Kingdom, this Announcement is only addressed to and directed at persons (i) who 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) falling within Article 49(2)(a) to (d) (high net worth companies, incorporated associations, etc.) of the Order; and (c) other persons to whom it may otherwise lawfully be communicated (all such persons in (i) and (ii) together being referred to as "relevant persons"). The Placing Shares are only available to, and any invitation, offer or agreement to subscribe, purchase or otherwise acquire such shares will be engaged in only with, relevant persons. Any person who is not a relevant person should not act or rely on this Announcement or any of its contents.
In any European Economic Area ("EEA") Member State that has implemented Directive 2003/71/EC (together with any applicable implementing measures in any Member State, the "Prospectus Directive"), this communication is only addressed to and is only directed at: (a) qualified investors in that Member State within the meaning of Article 2(1)(e) of the Prospectus Directive; and (b) other persons who are permitted to purchase the Placing Shares pursuant to an exemption under the Prospectus Directive and other applicable regulations. This Announcement has been prepared on the basis that all offers of Placing Shares will be made pursuant to an exemption under the Prospectus Directive, as implemented in member states of the EEA, from the requirement to produce a prospectus for offers of Placing Shares. Accordingly, any person making or intending to make any offer within the EEA of the Placing Shares which are the subject of the Admission contemplated in this Announcement should only do so in circumstances in which no obligation arises for the Company, J.P. Morgan Cazenove or Oriel Securities to produce a prospectus for such offer. None of the Company, J.P. Morgan Cazenove or Oriel Securities has authorised, nor do they authorise, the making of any offer of Placing Shares through any financial intermediary, other than offers made by J.P. Morgan Cazenove or Oriel Securities which constitute the final placement of Placing Shares contemplated in this Announcement.
The Company is established in Jersey as an unregulated exchange-traded fund for the purposes of the Collective Investment Funds (Unregulated Funds) (Jersey) Order 2008. The Company is not regulated in Jersey. The Jersey Financial Services Commission has neither evaluated nor approved the scheme or arrangement of the Company, parties involved in the promotion, management or administration of the Company or this Announcement. The Jersey Financial Services Commission has no ongoing responsibility to monitor the performance of the Company, to supervise the management of the Company or to protect the interests of investors in the Company.
The distribution of this Announcement and the offering of the Placing Shares in certain jurisdictions may be restricted by law. The Placing Shares may not (unless an exemption under the relevant securities laws is applicable) be offered, sold, resold or delivered, directly or indirectly, in or into the Australia, Canada, South Africa or Japan or any other jurisdiction outside the United Kingdom. No action has been taken by the Company or the Bookrunners or any of their respective affiliates that would permit an offering of such shares or possession or distribution of this Announcement or any other offering or publicity material relating to such shares in any jurisdiction where action for that purpose is required. Persons into whose possession this Announcement comes are required by the Company and the Bookrunners to inform themselves about, and to observe, any such restrictions.
Persons (including, without limitation, nominees and trustees) who have a contractual or other legal obligation to forward a copy of this Announcement should seek appropriate advice before taking any action.
The statements contained in this Announcement that are not historical facts are "forward-looking" statements, which are based on the Company's current intentions, beliefs and expectations about, among other things, the Company's results of operations, financial condition, prospects, growth, strategies and the industry in which the Company operates. Forward-looking statements are typically identified by the use of forward-looking terminology such as "believes", "expects", "may", "will", "could", "should", "intends", "estimates", "plans", "assumes" or "anticipates" or the negative thereof or other variations thereon or comparable terminology, or by discussions of strategy that involve risks and uncertainties. By their nature, forward-looking statements involve known and unknown risks and uncertainties because they relate to events and depend on circumstances that may or may not occur in the future. Such risks and uncertainties could cause actual results to vary materially from the future results indicated, expressed or implied in such forward-looking statements. Given these risks and uncertainties, prospective investors are cautioned not to place undue reliance on forward-looking statements. The forward-looking statements contained in this Announcement speak only as of the date of this Announcement and the Company undertakes no duty to update any of them publicly in light of new information or future events, except to the extent required by applicable law.
Any indication in this Announcement of the price at which shares have been bought or sold in the past cannot be relied upon as a guide to future performance. 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 the income from them may go down as well as up and investors may not get back the full amount invested on disposal of the shares.
Neither the content of the Company's website (or any other website) nor the content of any website accessible from hyperlinks on the Company's website (or any other website) is incorporated into, or forms part of, this Announcement.
This Announcement has been issued by and is the sole responsibility of the Company.
J.P. Morgan Cazenove, which is authorised and regulated in the United Kingdom by the Financial Services Authority, is acting as nominated adviser, joint broker and joint bookrunner to the Company in connection with the matters described herein. J.P. Morgan Cazenove's responsibilities as the Company's nominated adviser under the AIM Rules are owed solely to the London Stock Exchange and are not owed to the Company or to any director or to any other person in respect of his decision to acquire shares in the Company in reliance on is document. J.P. Morgan Cazenove is acting for the Company in relation to the Placing and the AIM Admission and no-one else and will not be responsible to anyone other than the Company for providing the protections afforded to its clients, nor for providing advice in relation to the Placing and the AIM Admission, the contents of this Announcement or any transaction or arrangement referred to herein.
Oriel Securities, which is authorised and regulated in the United Kingdom by the Financial Services Authority, is acting as joint broker and joint bookrunner to the Company in connection with the matters described herein. Oriel Securities is acting for the Company in relation to the Placing and no-one else and will not be responsible to anyone other than the Company for providing the protections afforded to its clients, nor for providing advice in relation to the Placing, the contents of this Announcement or any transaction or arrangement referred to herein.
Ogier Corporate Finance Limited, which is a member of the CISX, is the sponsor to the listing on the CISX and is acting exclusively for the Company in relation to the CISX Admission and no-one else, and will not be responsible to anyone other than the Company for providing the protections afforded to customers of Ogier Corporate Finance Limited, nor for providing advice in relation to the CISX Admission to the CISX, the contents of this Announcement or any transaction or arrangement referred to herein.
This summary should be read in conjunction with the full text of this Announcement.
LXB RETAIL PROPERTIES PLC
LXB Retail Properties Plc announces a cash placing to raise funds for further acquisition opportunities
1. Background to and reasons for the Placing
LXB Retail invests primarily in UK out of town and edge of town retail property. Since launching on AIM and the CISX last October, the Group has acquired a number of sites in two locations, Greenwich and Biggleswade, which the Directors believe offer the potential for significant value enhancement for Shareholders. Discussions have commenced with local authorities with regards to planning at both sites, and further announcements will be made when appropriate.
Following the most recent acquisitions at Greenwich (which were announced on 28 June 2010), the Group has now committed over 85 per cent. of the funds raised the Company's initial placing and admission to AIM and the CISX on 20 October 2009. LXB Manager continues to see new opportunities which offer the potential to create value for Shareholders, and the purpose of the Placing is to raise additional funds in order that those opportunities may be pursued and, where considered appropriate, acquisitions made.
LXB Manager is currently looking at several opportunities across existing and new locations, including a retail park redevelopment on the south coast of England and a major redevelopment in the Midlands. The initial purchase prices of these assets vary from below £10 million to approximately £30 million. Some of these opportunities are at a more advanced stage than others, with discussions already taking place with potential retail tenants and draft heads of terms agreed or contracts being negotiated. However, any future acquisition would be subject to final contracts being entered into, and there can be no certainty that any of the current opportunities being evaluated by LXB Manager will result in acquisitions taking place. Furthermore, all acquisitions are subject to approval by the Fund's investment committee in accordance with the committee's terms of reference (as outlined in the Admission Document).
The net proceeds of the Placing will enable the Company to continue its strategy as it looks to take advantage of new investment opportunities in existing and new locations as they arise.
As more particularly described in the Admission Document, LXB Manager's team has a track record of delivering good returns and, as evidenced by its actions since the AIM and CISX launch, the team has the ability to source, negotiate, and complete acquisitions of sites (including complex site assemblies in multiple ownerships) in locations which LXB Manager believes represent key space requirements for some of the UK's major retailers.
2. Details of the Placing
The Company proposes to raise approximately £40 million (before expenses) through the issue of the Placing Shares at 96 pence per share. The Placing will be on a non pre-emptive basis.
The Placing will be conducted in accordance with the terms and conditions set out in Annex II to this Announcement. The Placing will be effected by way of an accelerated bookbuilding to be managed by the Bookrunners. The book will open with immediate effect. The timing of the closing of the book and allocations is at the absolute discretion of the Bookrunners. The number of Placing Shares will be agreed by the Company with the Bookrunners at the close of the accelerated bookbuilding period and announced as soon as practicable afterwards.
In the interests of keeping the costs and timing associated with the fundraising to a minimum, the Directors have concluded that a limited marketing exercise, without offering all existing Shareholders the opportunity to participate in the Placing on a pre-emptive basis, is the most suitable option. The Placing Price of 96 pence per Placing Share represents a premium of approximately 8.8 per cent. to the closing middle market quotation of a Share on 13 July 2010 (being the last practicable dealing day prior to the release of this Announcement). In setting the Placing Price, the Directors have considered the price at which the Placing Shares need to be offered to investors to ensure the success of the Placing and raise a significant level of equity, compared to the current market capitalisation of the Company. The Directors believe that both the Placing Price and premium are appropriate. Accordingly, the Directors have decided that it would be in the best interests of the Company and its Shareholders for the funds to be raised through the Placing.
The Placing Shares will be credited as fully paid when issued and will rank pari passu in all respects with the Existing Shares of the Company, including the right to receive all dividends and other distributions declared, made or paid after the date of the issue.
The Placing is conditional upon, amongst other things, passing of all the Resolutions at the Extraordinary General Meeting expected to be held on 2 August 2010, Admission becoming effective by no later than 8.00 a.m. on 3 August 2010 (or such later time and date, not being later than 10 August 2010, as the Company may agree with the Bookrunners) and the Placing Agreement becoming unconditional and not being terminated prior to Admission in accordance with its terms.
Application will be made to the London Stock Exchange for the Placing Shares to be admitted to trading on AIM. Application will also be made to the CISX for the Placing Shares to be admitted to listing on the Daily Official List of the CISX. It is expected that Admission will take place at 8.00 a.m. on 3 August 2010 and that dealings in the Placing Shares on AIM and on the CISX will commence at that time.
In the case of Placees requesting their Placing Shares in uncertificated form, it is expected that the appropriate CREST accounts will be credited with the Placing Shares comprising their placing participation with effect from 3 August 2010. In the case of Placees requesting their Placing Shares in certificated form, it is expected that certificates in respect of such shares will be despatched by post not later than 10 dealing days after Admission.
Further details of the Placing are set out in Annex I (Terms and Conditions) to this Announcement.
3. Proposed amendment to the Articles of Association
3.1 Benefit Plan Investors
The Directors believe that in order to facilitate the Placing, it may be beneficial to allow a limited number of Benefit Plan Investors to subscribe for Placing Shares, subject to obtaining suitable representations from such investors. To accomplish this, the Placing will prohibit Benefit Plan Investors or investors subject to Similar Law from purchasing Shares, except with the express consent of the Company. This mechanism will allow the Company to control the number of such investors in the Placing.
Article 6.6 of the Articles of Association states that "no Benefit Plan Investor or employee benefit plan subject to Similar Law may acquire Shares." In order to allow a limited number of such investors to participate in the Placing, the Directors will propose a special resolution at the Extraordinary General Meeting (as detailed further below) which, if approved by Shareholders, will remove Article 6.6 from the Articles of Association.
Under the current Plan Asset Regulations, if interests held by Benefit Plan Investors are deemed to be "significant" within the meaning of the Plan Asset Regulations (broadly, if Benefit Plan Investors hold 25 per cent. or more of any class of equity interest in the Company) then the assets of the Company may be deemed to be "plan assets" within the meaning of the Plan Asset Regulations.
Accordingly, subject to two additional changes, there is no proposal to amend or delete any of the remaining provisions of Article 6 of the Articles of Association which give the Directors the discretion to require to compulsory transfer of any Shares acquired by any Benefit Plan Investor or employee benefit plan subject to Similar Law where such acquisition may result in ownership of all Benefit Plan Investors exceeding this 25 per cent. threshold (the "Compulsory Transfer Provisions").
The two additional proposed changes comprise amendments to the definition of "Prohibited Person" which is used in Article 6 to identify persons subject to the Compulsory Transfer Provisions. The first proposed change is to delete limb (d) of that definition. Limb (d) of the definition treats as a Prohibited Person any person who acquires shares that "would be for or on behalf of a Benefit Plan Investor, or a plan, individual retirement account or other arrangement that is subject to Similar Law." In view of the existing limb (e), which treats as a Prohibited Person any person who "may cause the Company's assets to be deemed to be 'plan assets' under the Plan Asset Regulations", limb (d) is unnecessary and inconsistent with the desire to permit certain Benefit Plan Investors to invest on a limited basis. If approved, the special resolution to amend the Articles of Association will delete limb (d) of the definition of Prohibited Persons.
After completion of the Placing, the Company may be unable to monitor whether further Benefit Plan Investors acquire Shares and therefore, there can be no assurance that in future Benefit Plan Investors will never acquire Shares or that, if they do, the ownership of all Benefit Plan Investors will be below the 25 per cent. threshold referred to above or that the Company's assets will not otherwise constitute "plan assets" under Plan Asset Regulations. If the Company's assets were deemed to constitute "plan assets," certain transactions that the Company might enter into in the ordinary course of business and operation might constitute non-exempt prohibited transactions under ERISA or the Code, resulting in excise taxes or other liabilities under ERISA or the Code. In addition, any fiduciary of a Benefit Plan Investor or an employee benefit plan subject to Similar Law that is responsible for the Plan's investment in Shares could be liable for any ERISA violations or violations of such Similar Law relating to the Company. In such circumstances, the Directors would need to exercise their authority under the Compulsory Transfer Provisions.
3.2 Investment Manager Registration or Regulatory Oversight
The second proposed change to the definition of Prohibited Persons is to amend limb (c) of the definition of Prohibited Person to expand the coverage of adverse regulatory developments that might warrant invoking the Compulsory Transfer Provisions. If approved, the special resolution to amend the Articles of Association will amend limb (c) of the definition of Prohibited Persons so that it treats as Prohibited Persons, any person who "may, in the opinion of the Directors, result in the Company and/or the Members as a whole or any number of the Members incurring any liability to taxation or suffering any other regulatory, pecuniary, legal or material administrative disadvantage that the Company or Members might not otherwise have suffered or incurred (including without limitation subjecting the Company or the Investment Manager to registration or other regulatory oversight)".
3.3 Other amendment
In order to the facilitate the Placing, the Directors believe that it would be appropriate to amend Article 4.4 of the Articles of Association, which currently reads "The Company shall not pay any brokerage or commission on the issue of its Shares". If approved, the special resolution to amend the Articles of Association will amend this article so that it will read "The Company may exercise the powers conferred by the Law to pay any brokerage or commission on the issue of its Shares".
4. Investing policy
In light of investments made by the Company since the initial placing and admission of the Company to AIM and the CISX on 20 October 2009, the Directors believe it would be appropriate to amend and restate the Company's investing policy as set out in the Admission Document.
The investing policy currently contains the following paragraph:
"Once the net proceeds of the Placing are fully invested, it is envisaged that the Fund will have investments in 10-15 property assets. Where LXB Manager identifies large-scale opportunities, it may choose to pursue these by investing through co-investment structures or with joint venture partners."
The Directors believe it would be more appropriate for this paragraph to be amended so that it reads:
"Once the net proceeds of the initial placing of October 2009 and the subsequent placing of August 2010 are fully invested, it is envisaged that the Fund will have investments in 5 to 10 property schemes, which may include a number of properties that are geographically adjacent where the intention is to consolidate ownerships and create a more substantial retail destination. Where LXB Manager identifies large-scale opportunities, it may choose to pursue these by investing through co-investment structures or with joint venture partners".
In accordance with Rule 8 of the AIM Rules, the Directors will propose an ordinary resolution to Shareholders at the Extraordinary General Meeting for the approval of an amended and restated investing policy. Following the passing of this resolution, the amended and restated investing policy will supersede the Company's original investing policy.
5. Extraordinary general meeting
In order for the Company to be able to issue the Placing Shares on a non pre-emptive basis, amend the Articles of Association and adopt a revised investing policy as described in this Announcement, it is necessary to obtain Shareholder approvals. In accordance with the Articles of Association, a newspaper advertisement convening an Extraordinary General Meeting is expected to be published on 16 July 2010 in The Times and The Jersey Gazette. A circular to Shareholders will be posted on or around that date. The notice of Extraordinary General Meeting will contain the Resolutions to be considered and, if thought fit, approved by Shareholders. It is expected that the Extraordinary General Meeting will be held on 2 August 2010.
6. Intentions of the Directors and the Investment Manager
Philip Wrigley, Stephen Webb, Daniel Kitchen and John Alastair Irvine, who are all Directors, and Tim Walton, Brendan O'Grady, Carl Barrand and Nick Alford of the LXB Manager team, currently intend to subscribe for approximately £1.5m in aggregate of Placing Shares pursuant to the Placing. Further details of such subscriptions will be notified in due course.
7. Recommendation
The Directors consider that the passing of the Resolutions referred to above is in the best interests of the Company and its Shareholders as a whole. Accordingly, the Directors unanimously recommend the Shareholders to vote in favour of the Resolutions to be proposed at the Extraordinary General Meeting as they intend to do in respect of their own beneficial holdings of 2,900,000 Shares representing approximately 2.54 per cent. of the Existing Shares.
Expected timetable
|
| 2010
|
| Record Date for posting of circular to Shareholders
| 6.00 p.m. on 13 July |
| Announcement of Placing
| 14 July |
| Notice convening EGM published in The Times and the Jersey Gazette
| 16 July |
| Posting of circular to Shareholders
| 16 July |
| Last time for receipt of Forms of Proxy
| 11.00 a.m. on 31 July |
| EGM
| 11.00 a.m. on 2 August |
| Admission of Placing Shares effective and expected commencement of dealings in the Placing Shares on AIM and CISX
| 8.00 a.m. on 3 August |
| CREST accounts credited (as applicable)
| 3 August |
| Expected date of despatch of definitive share certificates (as applicable)
| within 10 dealing days of Admission |
ANNEX I
TERMS AND CONDITIONS
IMPORTANT INFORMATION ON THE PLACING FOR INVITED PLACEES ONLY
MEMBERS OF THE PUBLIC ARE NOT ELIGIBLE TO TAKE PART IN THE PLACING. THIS ANNEX AND THE TERMS AND CONDITIONS SET OUT HEREIN ARE FOR INFORMATION PURPOSES ONLY AND ARE DIRECTED ONLY AT: (A) PERSONS IN MEMBER STATES OF THE EUROPEAN ECONOMIC AREA WHO ARE QUALIFIED INVESTORS (AS DEFINED IN ARTICLE 2(1)(E) OF EU DIRECTIVE 2003/71/EC (THE "PROSPECTUS DIRECTIVE")); AND (B) QUALIFIED INVESTORS IN THE UNITED KINGDOM WHO ARE PERSONS WHO (I) HAVE PROFESSIONAL EXPERIENCE IN MATTERS RELATING TO INVESTMENTS FALLING WITHIN ARTICLE 19(1) OF THE FINANCIAL SERVICES AND MARKETS ACT 2000 (FINANCIAL PROMOTION) ORDER 2005 (THE "ORDER"); (II) ARE PERSONS FALLING WITHIN ARTICLE 49(2)(A) TO (D) (HIGH NET WORTH COMPANIES, UNINCORPORATED ASSOCIATIONS, ETC) OF THE ORDER; OR (III) ARE PERSONS TO WHOM IT MAY OTHERWISE BE LAWFULLY COMMUNICATED (ALL SUCH PERSONS IN (A) AND (B) TOGETHER BEING REFERRED TO AS "RELEVANT PERSONS"). THIS ANNEX AND THE TERMS AND CONDITIONS SET OUT HEREIN MUST NOT BE ACTED ON OR RELIED ON BY PERSONS WHO ARE NOT RELEVANT PERSONS. ANY INVESTMENT OR INVESTMENT ACTIVITY TO WHICH THIS ANNEX AND THE TERMS AND CONDITIONS SET OUT HEREIN RELATES IS AVAILABLE ONLY TO RELEVANT PERSONS AND WILL BE ENGAGED IN ONLY WITH RELEVANT PERSONS. THIS ANNEX DOES NOT ITSELF CONSTITUTE AN OFFER FOR SALE OR SUBSCRIPTION OF ANY SECURITIES IN THE COMPANY.
The Placing Shares have not been, and will not be, registered under the Securities Act or under the laws of any State of the United States and may not be offered or sold in or into the United States or to, or for the account or benefit of, US persons except pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act. No public offering of securities will be made in the United States. The Placing Shares are being offered and sold outside of the United States in reliance of Regulation S of the Securities Act, and within United States pursuant to an exemption from the registration requirements of the Securities Act;
The Company has not been, and will not be, registered under the Investment Company Act, in reliance of Section 3(c)(7) thereof, and investors will not be entitled to the benefits of that Act, and Placing Shares are only being offered to US Persons that are qualified institutional buyers (as defined in Rule 144A under the Securities Act), and are also qualified purchasers (as defined in Section 2(a)(51) of the Investment Company Act).
Except with the express consent of the Company given in respect of an investment in the Placing, the Placing Shares may not be acquired by investors using assets of (i) an employee benefit plan that is subject to the fiduciary responsibility or prohibited transaction provisions of Title I of the ERISA, (including, as applicable, assets of an insurance company general account) or a plan that is subject to the prohibited transaction provisions of Section 4975 of the Code, (including an individual retirement account), (ii) an entity whose underlying assets include "plan assets" by reason of a plan's investment in the entity, (iii) a "benefit plan investor" as otherwise defined in Section 3(42) of ERISA or regulations promulgated by the US Department of Labor or (iv) a plan, individual retirement account or other arrangement that is subject to any Similar Law. Violation of these restrictions could result in mandatory transfer of Shares.
Details of the Placing Agreement and the Placing Shares
The Bookrunners have today entered into a placing agreement with the Company and LXB Manager (the "Placing Agreement") under which the Bookrunners have, on the terms and subject to the conditions set out therein, undertaken to use reasonable endeavours to procure subscribers for the Placing Shares by way of an accelerated bookbuild process (the "Bookbuild").
In this Annex, unless the context otherwise requires, Placee means a person (including individuals, funds or others) on whose behalf a commitment to subscribe for Placing Shares has been given to the Company.
Bookbuild
The Bookrunners will today commence the Bookbuild to determine demand for participation in the Placing. This Annex gives details of the terms of and conditions to, and the mechanics of participation in, the Placing. No commissions will be paid to Placees or by Placees in respect of any Placing Shares.
The Bookrunners and the Company shall be entitled to effect the Placing by such alternative method to the Bookbuild as they may, in their absolute discretion, determine.
Participation in, and principal terms of, the Placing
1. J.P. Morgan Cazenove and Oriel Securities are arranging the Placing as Bookrunners and agents of the Company.
2. Participation in the Placing will only be available to persons who may lawfully be, and are, invited to participate by the Bookrunners. The Bookrunners and their respective affiliates are entitled to enter bids in the Bookbuild as principals.
3. The placing price is 96 pence per Placing Share (the "Placing Price"). The number of Placing Shares will be agreed between the Bookrunners and the Company following completion of the Bookbuild. The number of Placing Shares will be announced on a Regulatory Information Service ("RIS") following the completion of the Bookbuild (the "Pricing Announcement").
4. To bid in the Bookbuild, Placees should communicate their bid by telephone to their usual sales contact at J.P. Morgan Cazenove and Oriel Securities. Each bid should state the number of Placing Shares which the prospective Placee wishes to subscribe for at the Placing Price. Bids may be scaled down by the Bookrunners on the basis referred to in paragraph 7 below.
5. The Bookbuild is expected to close no later than 5:00 p.m. on 14 July 2010 but may be closed earlier or later at the discretion of the Bookrunners. The Company and the Bookrunners reserve the right to reduce or seek to increase the amount to be raised pursuant to the Placing, in their absolute discretion.
6. Each prospective Placee's allocation will be confirmed to such Placee orally by the Bookrunners (as agents for the Company) following the close of the Placing, and a trade confirmation will be dispatched thereafter. The Bookrunners' oral confirmation to such Placee will constitute an irrevocable legally binding commitment upon such person (who will at that point become a Placee) in favour of the Bookrunners and the Company, under which it agrees to subscribe for the number of Placing Shares allocated to it at the Placing Price on the terms and conditions set out in this Annex and in accordance with the Articles of Association.
7. Subject to paragraphs 4 and 5 above, the Bookrunners may choose to accept bids, either in whole or in part, on the basis of allocations determined at their discretion and may scale down any bids for this purpose on such basis as they may determine. The Bookrunners may also, notwithstanding paragraphs 4 and 5 above (i) allocate Placing Shares after the time of any initial allocation to any person submitting a bid after that time and (ii) allocate Placing Shares after the Bookbuild has closed to any person submitting a bid after that time.
8. A bid in the Bookbuild will be made on the terms and subject to the conditions in this Annex and will be legally binding on the Placee on behalf of which it is made and except with the Bookrunners' consent will not be capable of variation or revocation after the time at which it is submitted. Each Placee will also have an immediate, separate, irrevocable and binding obligation, owed to the Bookrunners (as agents of the Company), to pay them (or as they 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 subscribe and the Company has agreed to allot. Each Placee's obligations will be owed to the Company and to each of the Bookrunners.
9. Except as required by law or regulation, no press release or other announcement will be made by the Bookrunners or the Company using the name of any Placee (or its agent), in its capacity as Placee (or agent) other than with such Placee's prior written consent.
10. Irrespective of the time at which a Placee's allocation pursuant to the Placing is 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".
11. All obligations under the Bookbuild and Placing will be subject to fulfilment 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 "Right to terminate under the Placing Agreement".
12. By participating in the Bookbuild, each Placee will agree 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.
13. To the fullest extent permissible by law, neither the Bookrunners nor any of their respective affiliates shall have any liability to Placees (or to any other person whether acting on behalf of a Placee or otherwise). In particular, none of J.P. Morgan Cazenove and Oriel Securities nor any of their respective affiliates shall have any liability (including to the extent permissible by law, any fiduciary duties) in respect of the Bookrunners' conduct of the Bookbuild or of such alternative method of effecting the Placing as the Bookrunners and the Company may agree.
Conditions of the Placing
The Bookrunners' obligations under the Placing Agreement in respect of the Placing Shares are conditional on, inter alia:
1. the passing of the Resolutions (without amendment) at the EGM on 2 August 2010 (and not, except with the prior written agreement of the Bookrunners (such agreement not to be unreasonably withheld or delayed) at any adjournment of such meeting);
2. the representations, warranties and undertakings on the part of the Company and the LXB Manager contained in the Placing Agreement being true, accurate and not misleading on and as of the date of the Placing Agreement, the time of the execution of the terms of subscription annexed to the Placing Agreement, at the date of the EGM and at the date of Admission in each case as though they had been given and made on such date by reference to the facts and circumstances then subsisting, and no matter having arisen prior to Admission which might reasonably be expected to give rise to a claim under the indemnity provisions in the Placing Agreement;
3. the Company and the LXB Manager having complied with all of their respective obligations under the Placing Agreement, the AIM Rules and the Listing Rules and satisfied all of the conditions on their part, in each case under the Placing Agreement and under the terms or conditions of the Placing which fall to be performed or satisfied on or prior to the date of Admission;
4. in the opinion of the Bookrunners (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); and
5. each of AIM Admission and CISX Admission occurring not later than 8.00 a.m. on 3 August 2010 (or such later time or date, not being later than 10 August 2010, as the Bookrunners may agree with the Company).
If (i) any of the conditions contained in the Placing Agreement are not fulfilled or waived by the Bookrunners by the respective time or date where specified therein (or such later time or date as the Bookrunner and the Company may agree) or (ii) the Placing Agreement is terminated in the circumstances specified below under "Right to terminate under the Placing Agreement", the Placing will lapse and the Placee's rights and obligations hereunder in relation to the Placing Shares shall cease and terminate at such time and each Placee agrees that no claim can be made by the Placee in respect thereof.
The Bookrunners may, at their discretion and upon such terms as they think fit, waive, or extend the time for, compliance by the Company with the whole or any part of any of the Company's obligations in relation to the conditions in the Placing Agreement save that the above condition relating to Admission taking place may not be waived. Any such extension or waiver will not affect Placees' commitments as set out in this Announcement.
Neither the Bookrunners nor the Company nor any other person 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 they 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 they 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 the Bookrunners.
Right to terminate under the Placing Agreement
Either Manager may, by notice to the Company and LXB Manager, terminate the Placing Agreement at any time prior to Admission if:
1. any statement contained in, amongst other documents, this Announcement is or has become or has been discovered to be untrue or incorrect in any material respect or misleading in any respect, or any matter has arisen which would, if, amongst other documents, this Announcement were to be issued at that time, constitute a material inaccuracy or omission therefrom;
2. the Company or the LXB Manager fails to comply with any of its obligations under the Placing Agreement or under the terms of the Placing, the result of which in the opinion of either of J.P. Morgan Cazenove or Oriel Securities acting in good faith is material in the context of the Placing;
3. there has been a breach by the Company or the LXB Manager of any of the representations, warranties or undertakings contained in the Placing Agreement or any other provisions of the Placing Agreement;
4. any matter has arisen which might reasonably be expected to give rise to a Claim for indemnification under the relevant provisions of the Placing Agreement which either J.P. Morgan Cazenove or Oriel Securities consider in good faith to be material in the context of the Group taken as a whole, the Placing and/or Admission;
5. in the opinion of either of J.P. Morgan Cazenove or Oriel Securities acting in good faith there shall have been a Material Adverse Change (whether or not foreseeable at the date of the Placing Agreement);
6. there having occurred or, in the opinion of either of J.P. Morgan Cazenove and Oriel Securities, it being reasonably likely that there will occur:
6.1 any material adverse change in the financial markets in the United States, the United Kingdom, the Channel Islands or in any member or associate member of the European Union or the national or international financial markets, any outbreak or escalation of hostilities, war, act of terrorism, declaration of emergency or martial law or other calamity or crisis or event or any change or development involving a prospective change in national or international political, financial, economic, monetary or market conditions or currency exchange rates or controls; or
6.2 trading generally on the New York Stock Exchange, the NASDAQ National Market, the Exchange or CISX has been suspended or limited, or minimum or maximum prices for trading have been fixed, or maximum ranges for prices of securities have been required, by any of the said exchanges or by such market or by order of any governmental authority, or a material disruption has occurred in commercial banking or securities settlement or clearance services; or
6.3 any actual or prospective change or development in United States, United Kingdom or Jersey taxation affecting any member of the Group, the Shares or the transfer thereof or exchange controls have been imposed by the United States, the United Kingdom or Jersey the result of which in the opinion of J.P. Morgan Cazenove or Oriel Securities acting in good faith is material in the context of the Placing; or
6.4 the application in respect of AIM Admission or CISX Admission is withdrawn or refused by AIM or CISX, as the case may be; or
6.5 a banking moratorium has been declared by the United States, the United Kingdom, Jersey or New York Authorities,
in each case the effect of which (either singly or together with any other event referred to in paragraph 6 above is such as to make it in the judgment of either J.P. Morgan Cazenove or Oriel Securities acting in good faith impracticable or inadvisable to market the Placing Shares or to enforce contracts for sale of the Placing Shares, or which may prejudice the success of the Placing or dealings in Placing Shares in the secondary market.
By participating in the Placing, Placees agree that the exercise by the Bookrunners of any right of termination or other discretion under the Placing Agreement shall be within the absolute discretion of the Bookrunners and that it need not make any reference to Placees and that it shall have no liability to Placees whatsoever in connection with any such exercise.
By participating in the Placing, each Placee agrees that its rights and obligations cease and terminate only in the circumstances described above and will not be capable of rescission or termination by it.
No prospectus
No offering document or prospectus has been or will be submitted to be approved by the FSA in relation to the Placing and the Placees' commitments will be made solely on the basis of the information contained in this Announcement and any information publicly announced to an RIS by or on behalf of the Company on or prior to the date of this Announcement and subject to the further terms set forth in the trade confirmation to be provided to individual prospective 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 other information, representation, warranty or statement made by or on behalf of the Company or the Bookrunners or any other person and neither the Bookrunners nor the Company nor any other person will be liable for any Placee's decision to participate in the Placing based on any other information, representation, warranty or statement which the Placees may have obtained or received. Nothing in this paragraph shall exclude the liability of any person for fraudulent misrepresentation.
Registration and Settlement
Settlement of transactions in the Placing Shares (ISIN: JE00B4MFKH73) following Admission will take place within the system administered by Euroclear UK & Ireland Limited ("CREST"), subject to certain exceptions, but the Bookrunners reserve the right to require settlement for and delivery of the Placing Shares to Placees by such other means that they deem necessary if delivery or settlement is not possible or practicable within CREST within the timetable set out in this Announcement or would not be consistent with the regulatory requirements in the Placee's jurisdiction.
Following the close of the Bookbuild, each Placee allocated Placing Shares in the Placing will be sent a trade confirmation in accordance with the standing arrangements in place with the Manager with whom they conduct their trade (the "Relevant Manager"), stating the number of Placing Shares allocated to it at the Placing Price, the aggregate amount owed by such Placee to the Relevant Manager and settlement instructions. Settlement will take place on a T + 14 basis. Each Placee agrees that it will do all things necessary to ensure that delivery and payment is completed in accordance with either the standing CREST or certificated settlement instructions that it has in place with the Relevant Manager.
Interest is chargeable daily on payments not received from Placees on the due date in accordance with the arrangements set out above at the rate of two percentage points above LIBOR as determined by the Relevant Manager.
Each Placee agrees that, if it does not comply with these obligations, the Bookrunners may sell any or all of the Placing Shares allocated to that Placee on such Placee's behalf and retain from the proceeds, for the Company's 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 for any shortfall below the aggregate amount owed by it and may be required to bear any stamp duty or stamp duty reserve tax (together with any interest or penalties) which may arise upon the sale of such Placing Shares on such Placee's behalf.
If Placing Shares are to be delivered to a custodian or settlement agent, Placees should ensure that the trade confirmation is copied and delivered immediately to the relevant person within that organisation.
Insofar as Placing Shares are registered in a Placee's name or that of its nominee or in the name of any person for whom a Placee is contracting as agent or that of a nominee for such person, such Placing Shares should, subject as provided below, be so registered free from any liability to UK stamp duty or stamp duty reserve tax.
Application for admission to listing and trading
Application will be made to the London Stock Exchange for Admission. Application will also be made to the CISX for the Placing Shares to be admitted to listing on the Daily Official List of the CISX at the same time as Admission occurs. The Shareholder circular to be published by the Company in connection with the EGM will constitute a listing document for the purpose of the application to the CISX for CISX Admission. It is expected that Admission will take place at 8.00 a.m. on 3 August 2010 and that dealings in the Placing Shares on AIM and on the CISX will commence at that time.
Representations, Warranties, Undertakings and Acknowledgements
By participating in the Placing, unless required to provide additional representations, warranties, undertakings and acknowledgements to comply with applicable securities laws, including the Securities Act, each Placee (and any person acting on such Placee's behalf):
1. represents and warrants that it has read and understood this Announcement in its entirety and that its acquisition of Placing Shares is subject to and based upon all the terms, conditions, representations, warranties, acknowledgements, agreements and undertakings and other information contained herein;
2. acknowledges that no offering document or prospectus has been prepared in connection with the Placing of the Placing Shares and represents and warrants that it has not received a prospectus or other offering document in connection therewith;
3. acknowledges that the content of this Announcement is exclusively the responsibility of the Company and that neither the Bookrunners nor any person acting on their respective behalf has or shall have any liability for any information, representation or statement contained in this Announcement or any information previously or subsequently published by or on behalf of the Company, including, without limitation, any information required to be published by the Company pursuant to applicable laws (the "Exchange Information"). Each Placee further represents, warrants and agrees that the only information on which it is entitled to rely and on which such Placee has relied in committing itself to acquire the Placing Shares is contained in this Announcement and any information previously published by the Company by notification to a RIS, such information being all that they deem necessary to make an investment decision in respect of the Placing Shares and that it has neither received nor relied on any other information given or representations, warranties or statements made by either of the Bookrunners or the Company and neither has it requested such information from the Bookrunners or the Company and neither the Bookrunners nor the Company will be liable for any Placee's decision to accept an invitation to participate in the Placing based on any information, representation or statement contained in this Announcement or any other information, representation, warranty or statement. Each Placee further acknowledges and agrees that it has relied on its own investigation of the business, financial or other position of the Company in deciding to participate in the Placing. None of the Bookrunners, the Company or any of their respective affiliates has made any representations to it, express or implied, with respect to the Company, the Placing and the Placing Shares or the accuracy, completeness or adequacy of the Exchange Information. It understands that the Exchange Information has been prepared in accordance with the UK format, style and content requirements, which differs from US format, style and content requirements. Nothing in this paragraph or otherwise in this Announcement excludes the liability of any person for fraudulent misrepresentation made by that person;
4. unless otherwise specifically agreed in writing with the Bookrunners, represents and warrants that (a) it is a person outside of the United States (other than a US Person (as defined in Regulation S)) and (b) neither it nor the beneficial owner of such Placing Shares is located in or a resident of Australia, Canada, South Africa or Japan, and acknowledges that the Placing Shares have not been and will not be registered under the securities legislation of Australia, Canada, South Africa or Japan and, subject to certain exceptions, may not be offered, sold, or delivered or transferred, directly or indirectly, within those jurisdictions;
5. represents and warrants that it is not, and that it is not acting on behalf or for the benefit of clients that are, Benefit Plans Investors or plans, individual retirement accounts or other arrangements that are subject to any Similar Laws and that it understands that the Placing Shares may not be acquired by a Benefit Plan Investor or by investors subject to Similar Laws, except with the express consent of the Company given in respect of an investment in the Placing;
6. represents and warrants that the allotment or issue to it, or the person specified by it for registration as holder, of Placing Shares will not give rise to a liability under any of sections 67, 70, 93 or 96 of the Finance Act 1986 (depositary receipts and clearance services) and that the Placing Shares are not being acquired in connection with arrangements to issue depositary receipts or to transfer Placing Shares into a clearance system;
7. if a financial intermediary, as that term is used in Article 3(2) of the Prospectus Directive (which means Directive 2003/71/EC and includes any relevant implementing measure in any member state) (the "Prospectus Directive"), represents and warrants that the Placing Shares purchased 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 European Economic Area other than qualified investors, or in circumstances in which the prior consent of the Bookrunners has been given to the offer or resale;
8. represents and warrants that it has not offered or sold and, prior to the expiry of a period of six months from Admission, will not offer or sell any Placing Shares to persons in the United Kingdom, 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 Financial Services and Markets Act 2000 ("FSMA");
9. represents and warrants that it has not offered or sold and will not offer or sell any Placing Shares to persons in the European Economic Area prior to 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 in and which will not result in an offer to the public in any member state of the European Economic Area within the meaning of the Prospectus Directive (including any relevant implementing measure in any member state);
10. represents and warrants that it has only communicated or caused to be communicated and 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 the Placing Shares in circumstances in which section 21(1) of the FSMA does not require approval of the communication by an authorised person;
11. represents and warrants that it has complied and will comply with all applicable provisions of the FSMA with respect to anything done by it in relation to the Placing Shares in, from or otherwise involving, the United Kingdom;
12. if in a Member State of the European Economic Area, unless otherwise specifically agreed with the Bookrunners in writing, represents and warrants that it is a "qualified investor" within the meaning of the Prospectus Directive;
13. if in the UK, represents and warrants that it is a person (i) who has professional experience in matters relating to investments falling within Article 19(1) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 (the "Order"); (ii) falling within Article 49(2)(A) to (D) ("High Net Worth Companies, Unincorporated Associations, etc") of the Order; or (iii) to whom this Announcement may otherwise be lawfully communicated;
14. represents and warrants that it and any person acting on its behalf is entitled to acquire the Placing Shares under the laws of all relevant jurisdictions which apply to it and that it has fully observed such laws and obtained all such governmental and other guarantees, permits, authorisations, approvals and consents which may be required thereafter and complied with all necessary formalities and that it has not taken any action or omitted to take any action which will or may result in the Bookrunners, the Company or any of their respective directors, officers, agents, employees or advisers acting in breach of the legal or regulatory requirements of any jurisdiction in connection with the Placing;
15. represents and warrants that it has all necessary capacity and has obtained all necessary consents and authorities to enable it to commit to its participation in the Placing and to perform its obligations in relation thereto (including, without limitation, in the case of any person on whose behalf it is acting, all necessary consents and authorities to agree to the terms set out or referred to in this Announcement) and will honour such obligations;
16. undertakes that it (and any person acting on its behalf) will make payment for the Placing Shares allocated to it in accordance with this Announcement on the due time and date set out herein, failing which the relevant Placing Shares may be placed with other subscribers or sold as the Bookrunners may in their absolute discretion determine and without liability to such Placee;
17. acknowledges that none of the Bookrunners, nor any of their respective affiliates, 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 treated for these purposes as a client of either of the Bookrunners and that the Bookrunners have no duties or responsibilities to it for providing the protections afforded to their clients or customers or for providing advice in relation to the Placing 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;
18. acknowledges that these terms and conditions and any agreements entered into by it pursuant to these terms and conditions shall be governed by and construed in accordance with English law and it submits (on behalf of itself and on behalf of any person on whose behalf it is acting) to the exclusive jurisdiction of the English courts as regards any claim, dispute or matter arising out of any such contract, 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 either of the Bookrunners 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;
19. agrees that the Company, the Bookrunners and their respective affiliates and others will rely upon the truth and accuracy of the foregoing representations, warranties, acknowledgements and undertakings which are given to the Bookrunners on its own behalf and on behalf of the Company and are irrevocable; and
20. agrees to indemnify and hold the Company, LXB Manager, each of the Bookrunners and their respective affiliates 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 in this Annex and further agrees that the provisions of this Annex shall survive after completion of the Placing.
Please also note that 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 UK relates only to their allotment and issue to Placees, or such persons as they nominate as their agents, direct from the Company for the Placing Shares in question. Such agreement assumes that the Placing Shares are not being subscribed for in connection with arrangements to issue depositary receipts or to issue or transfer the Placing Shares into a clearance service and will not give rise to a liability under any of sections 67, 70, 93 or 96 of the Finance Act 1986. If there are any such arrangements, or the settlement relates to any other dealing in the Placing Shares, stamp duty or stamp duty reserve tax may be payable, each Placee should seek its own advice and notify the relevant Manager accordingly. Neither the Company nor the Bookrunners are liable to pay any stamp duty or stamp duty reserve tax that arises in connection with arrangements to issue depositary receipts or to transfer the Placing Shares into a clearance service. Nor are the Company or the Bookrunners liable to bear any transfer taxes that arise on a sale of Placing Shares subsequent to their acquisition by Placees or for transfer taxes arising otherwise than under the laws of the United Kingdom. Each Placee should, therefore, take its own advice as to whether any such transfer tax liability arises. Furthermore, each Placee agrees to indemnify on an after-tax basis and hold each of the Bookrunners and/or the Company and their respective affiliates harmless from any and all interest, fines or penalties in relation to stamp duty, stamp duty reserve tax and all other similar duties or taxes to the extent that such interest, fines or penalties arise from the unreasonable default or delay of that Placee or its agent.
When a Placee or person acting on behalf of the Placee is dealing with the Bookrunners, any money held in an account with the Bookrunners 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 rules and regulations of the FSA made under the FSMA. The 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 the Bookrunners money in accordance with the client money rules and will be used by the Bookrunners in the course of their own business and the Placee will rank only as a general creditor of the Bookrunners.
All times and dates in this Announcement are subject to amendment by the Bookrunners (in their absolute discretion).
The rights and remedies of the Bookrunners under these terms and conditions are in addition to any rights and remedies which would otherwise be available to either of them and the exercise or partial exercise of one will not prevent the exercise of others.
The contract to subscribe for Placing Shares pursuant to the Placing will be governed by, and construed in accordance with, the laws of England. For the exclusive benefit of the Bookrunners, each Placee irrevocably submits to the exclusive jurisdiction of the English courts in respect of his agreement to subscribe for Placing Shares. This does not prevent an action being taken against a Placee in any other jurisdiction.
ANNEX II
DEFINITIONS
| "Admission" | AIM Admission and CISX Admission |
| "Admission Document" | the admission document issued by the Company on 20 October 2009 in connection with the Existing Shares, a copy of which is available for inspection free of charge on the Company's website |
| "AIM" | the AIM market of the London Stock Exchange |
| "AIM Admission" | admission of the Placing Shares to trading on AIM becoming effective in accordance with the AIM Rules |
| "AIM Rules" | the rules of the London Stock Exchange from time to time which govern the admission to trading on and the operation of AIM |
| "this Announcement" | this Announcement and the annexes thereto |
| "Articles of Association" | the articles of association of the Company |
| "Benefit Plan Investors" | (i) an employee benefit plan that is subject to the fiduciary responsibility or prohibited transaction provisions of Title I of the ERISA (including, as applicable, assets of an insurance company general account) or a plan that is subject to the prohibited transaction provisions of Section 4975 of the Code (including an individual retirement account), (ii) an entity whose underlying assets include "plan assets" by reason of a plan's investment in the entity, or (iii) any "benefit plan investor" as otherwise defined in Section 3(42) of ERISA or regulations promulgated by the US Department of Labor |
| "Board" or "Directors" | the board of directors of the Company as at the date of this Announcement |
| "Bookrunners" | J.P. Morgan Cazenove and Oriel Securities |
| "CISX" | the Channel Islands Stock Exchange, LBG |
| "CISX Admission" | admission of the Placing Shares to listing on the Daily Official List becoming effective in accordance with the Listing Rules |
| "Code" | the United States Internal Revenue Code of 1986, as amended from time to time |
| "Company" or "LXB Retail" | LXB Retail Properties Plc, a company, incorporated in Jersey with registered number 103911 |
| "CREST" | the system for paperless settlement of trades in securities and the holding of uncertificated securities operated by Euroclear UK & Ireland Limited in accordance with the Regulations |
| "dealing day" | a day on which dealings in domestic securities takes place on and with the authority of the London Stock Exchange |
| "ERISA" | the United States Employee Retirement Income Security Act of 1974, as amended from time to time, and the applicable regulations thereunder |
| "Extraordinary General Meeting" or "EGM" | the extraordinary general meeting of the Company expected to be convened for 11.00 a.m. on 2 August 2010, including any adjournment thereof |
| "Existing Shares" | the Shares in issue at the Record Date |
| "Financial Services Authority" or "FSA" | the UK Financial Services Authority |
| "Form of Proxy" | the form of proxy to be used in connection with the Extraordinary General Meeting |
| "FSMA" | the UK Financial Services and Markets Act 2000, as amended from time to time |
| "Fund" | LXB Retail Properties Fund LP incorporated in Scotland with registered number SL007349 |
| "Group" | the Company and any of its subsidiary undertakings from time to time (including the Fund (and its subsidiary undertakings) for such time as it remains a special purpose entity for the group headed by the Company) |
| "Investment Company Act" | the US Investment Company Act of 1940, as amended from time to time |
| "Investment Manager" | means LXB Manager and any individuals connected to LXB Manager (or any group company of LXB Manager) who are responsible for making investment decisions in relation to the Company |
| "Jersey Regulations" | the Companies (Uncertificated Securities) (Jersey) Order 1999, as amended from time to time |
| "JFSC" or "Commission" | Jersey Financial Services Commission |
| "J.P. Morgan Cazenove" | J.P. Morgan Securities Ltd., which conducts its UK investment banking activities as J.P. Morgan Cazenove |
| "Law" | the Companies (Jersey) Law 1991, as amended from time to time |
| "Listing Rules" | the listing rules produced by the CISX for companies whose securities are listed on the Daily Official List of the CISX as amended from time to time |
| "London Stock Exchange" | London Stock Exchange plc |
| "LXB Manager" | LXB Manager LLP, of 2nd Floor, Grafton House, Golden Square, London W1F 9HR |
| "Oriel Securities" | Oriel Securities Limited of 125 Wood Street, London EC2V 7AN |
| "Placees" | those persons subscribing for Placing Shares at the Placing Price pursuant to the Placing |
| "Placing" | the proposed placing by the Company of approximately £40,000,000 in aggregate of new Shares at the Placing Price |
| "Placing Agreement" | the placing agreement entered between the Bookrunners, the Company and LXB Manger dated 14 July 2010 |
| "Placing Price" | 96 pence per Placing Share |
| "Placing Shares" | new Shares to be issued at the Placing Price by the Company pursuant to the Placing |
| "Plan Asset Regulations" | the United States Department of Labor Regulations, 29 C.F.R. 2510.3-101, as and to the extent modified by section 3(42) of ERISA |
| "Prospectus Rules" | the prospectus rules as made by the FSA pursuant to Part VI of FSMA |
| "Record Date" | 6.00 p.m. on 13 July 2010, being the record date for posting of the Shareholder circular in connection with the EGM |
| "Regulations" | the UK Regulations and the Jersey Regulations, and in the event of any inconsistency between such Regulations and the Jersey Regulations, the latter shall prevail |
| "Resolutions" | the resolutions to be proposed at the Extraordinary General Meeting |
| "Securities Act" | the US Securities Act of 1933, as amended from time to time |
| "Shares" | ordinary shares of no par value in the capital of the Company |
| "Shareholders" | holders of Shares |
| "Similar Law" | any US federal, state, local or foreign law that is similar to the provisions of Section 406 of ERISA or Section 4975 of the Code |
| "Sterling" or "£" | pounds sterling, the lawful currency of the United Kingdom |
| "UK" or "United Kingdom" | the United Kingdom of Great Britain and Northern Ireland |
| "UK Listing Authority" | the FSA acting in its capacity as the competent authority for the purposes of Part VI of FSMA |
| "UK Regulations" | the Uncertificated Securities Regulations 2001 (SI 2001 No. 3755), as amended from time to time |
| "uncertificated" or "in uncertificated form" | recorded on the register of Shares as being held in uncertificated form in CREST, entitlement to which, by virtue of the UK Regulations, may be transferred by means of CREST |
| "US" or "United States" | United States of America, its territories and possessions, any state of the United States and the District of Columbia |
| "US Person" | as defined under Regulation S of the Securities Act |