TSL.L Regulatory News (TSL)

23 Oct 2006 07:01

Tissue Science Laboratories PLC23 October 2006 NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, IN WHOLE OR IN PART, IN OR INTOTHE UNITED STATES OF AMERICA, CANADA, AUSTRALIA, THE REPUBLIC OF IRELAND, THEREPUBLIC OF SOUTH AFRICA OR JAPAN. Neither this announcement nor any copy of it may be taken, transmitted ordistributed, directly or indirectly, in or into the United States, Canada,Australia, the Republic of Ireland, the Republic of South Africa or Japan. Anyfailure to comply with this restriction may constitute a violation of UnitedStates, Canadian, Australian, Republic of South Africa, Republic of Ireland orJapanese securities laws. 23 October 2006 Tissue Science Laboratories plc ("TSL" or the "Company") Placing of 5,090,910 New Ordinary Shares at 55 pence per share TSL, the medical technology company specialising in biologic tissue replacementand repair products, announces today that it proposes to raise £2.8 million(before expenses) by way of a placing of 5,090,910 new ordinary shares of 10pence each ("Placing Shares") at 55 pence per Placing Share (the "Placing").The net proceeds of the Placing will provide the Company with additional fundsto continue the development and expansion of its business. The Placing has beenarranged and underwritten by Nomura Code Securities Limited. Key points: - Placing of 5,090,910 Placing Shares to raise £2.8million (before expenses), representing approximately 14.7% per cent. of the Company's enlarged issued ordinary share capital - Placing price of 55 pence per Placing Share ("Placing Price") is the closing bid price on 20 October 2006 - The Placing Shares will be placed with institutional investors and directors - Mr. Patrick Paul, the Company's Non-executive Chairman, has undertaken to take up 1,014,618 Placing Shares at the Placing Price (equivalent to 19.93 per cent. of the Placing). - The Placing is conditional on the passing of a resolution to dis-apply pre-emption rights to be put to an extraordinary general meeting of the Company's shareholders to be held at 21 Tudor Street, London EC4Y 0DJ at 11:00 a.m. on 15 November 2006 Martin Hunt, Chief Executive Officer of TSL, commented: "This placing has been undertaken in response to investor feedback that theywould like to provide the business with additional working capital headroom.Whilst we had no specific need for additional financing, it does strengthen ourfinancial position and will benefit the business going forward. We are verypleased at the high level of interest we had from investors to the Placing,which was heavily oversubscribed, and believe we have struck the right balancein terms of the amount raised and setting the placing price at the current bidprice." Application will be made to the London Stock Exchange for the Placing Shares tobe admitted to trading on AIM. It is expected that such Admission will occur at08:00am on 16 November 2006. Enquiries: Tissue Science Laboratories PlcMartin Hunt, Chief Executive 01252 369603 Nomura Code Securities LimitedJuliet Thompson 0207 7761204Clare Terlouw 0207 7761205 Hogarth Partnership LimitedJames Longfield 0207 357 9477Sarah Richardson Nomura Code Securities Limited, which is authorised and regulated by theFinancial Services Authority, is acting for the Company and no other person inconnection with the Placing and will not be responsible to anyone other than theCompany for providing the protections afforded to customers of Nomura CodeSecurities Limited nor for advising any other person on the contents of thisannouncement or any matters described in this announcement. This announcement does not constitute, or form any part of, an offer orsolicitation of an offer to subscribe for the New Ordinary Shares. This summary should be read in conjunction with the full text of the attachedpress release. NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, IN WHOLE OR IN PART, IN OR INTOTHE UNITED STATES OF AMERICA, CANADA, AUSTRALIA, THE REPUBLIC OF IRELAND, THEREPUBLIC OF SOUTH AFRICA OR JAPAN. Neither this announcement nor any copy of it may be taken, transmitted ordistributed, directly or indirectly, in or into the United States, Canada,Australia, the Republic of Ireland, the Republic of South Africa or Japan. Anyfailure to comply with this restriction may constitute a violation of UnitedStates, Canadian, Australian, Republic of South Africa, Republic of Ireland orJapanese securities laws. 23 October 2006 Tissue Science Laboratories plc ("TSL" or the "Company") Placing of 5,090,910 New Ordinary Shares at 55 pence per share 1. Introduction The Company today announces that is intending to raise £2.8 million beforeexpenses, through the placing of 5,090,910 New Ordinary Shares at a PlacingPrice of 55 pence per share in order to create additional working capital. ThePlacing Price represents the bid price of the Company's shares on 20 October,being the last practicable date prior to the publication of this announcement.The Company has convened an EGM at which shareholder approval will be sought forauthority to issues shares in order to enable the Placing to take place. The Placing has been undertaken in response to feedback from investors that theywould like to provide the Company with additional working capital headroom.Whilst the Company has no specific need for additional financing, it doesstrengthen its financial position and will benefit the Company going forward.Following strong interest from investors, the Directors believe that they havestruck the right balance in terms of (i) the amount raised and (ii) the price atwhich the funds are being raised, which is the bid price at the close ofbusiness on 20 October 2003 (the last practicable day before publication of thisannouncement). 2. Principal Terms of the Placing Nomura Code have agreed to use their reasonable endeavours to procure placeesfor 5,090,910 New Ordinary Shares at the a Placing Price of 55 pence per sharewith institutional and other placees (including certain directors of theCompany, being Patrick Paul, David Jennings, Andrew Sealey, David Lindop andMartin Hunt) or, failing which, to subscribe themselves for the New OrdinaryShares which are being offered in the Placing. Accordingly, the Placing is beingfully underwritten by Nomura Code on the terms and subject to the conditions setout in the Placing Agreement. The Placing is conditional, inter alia, upon thepassing of the Resolution and Admission. As mentioned above, as part of the Placing, Patrick Paul has agreed to subscribefor 1,014,618 New Ordinary Shares, David Jennings has agreed to subscribe for13,636 New Ordinary Shares, Andrew Sealey has agreed to subscribe for 33,979 NewOrdinary Shares, David Lindop has agreed to subscribe for 18,181 shares andMartin Hunt has agreed to subscribe for 18,181 New Ordinary Shares. Mr. Paul'ssubscription is referred to in more detail at paragraph 3 below. The New Ordinary Shares, when issued, will rank pari passu, with the ExistingOrdinary Shares, including the right to receive all dividends and otherdistributions, thereafter declared, made or paid. Admission is expected to take place and dealings in the New Ordinary Shares areexpected to commence on the London Stock Exchange at 08:00 am (London time) on16 November 2006. 3. Related Party Transaction The subscription by Patrick Paul, Non-Executive Chairman of the Company, for1,014,618 New Ordinary Shares pursuant to the Placing will constitute a "relatedparty transaction" for the purposes of Rule 13 of the AIM Rules. As such, Mr.Paul has not taken part in the Board's decision to proceed with the Placing. Mr. Paul is currently interested in 5,882,440 Ordinary Shares (representing19.93 per cent. of the Company's issued share capital). Immediately upon thePlacing becoming unconditional, Mr. Paul would be interested in 6,897,058Ordinary Shares (representing 19.93 per cent. of the Company's issued sharecapital, as enlarged by the Placing). Accordingly, the Directors, other than Mr. Paul consider, having consulted withNomura Code in its capacity as Nominated Adviser to the Company, that the termsof Mr. Paul's subscription pursuant to the Placing are fair and reasonableinsofar as Shareholders are concerned. 4. Dis-application of pre-emption rights The Directors have considered the most appropriate method to conduct thefundraising. This included consideration of a placing and open offer or rightsissue. However, after careful consideration the Directors concluded that thebenefit of minimising the costs of the fundraising by way of a cash placingwould be in Shareholders' best interests. The Company does not currently have inplace sufficient existing authorities to enable the allotment of equitysecurities for cash on a non pre-emptive basis sufficient for the purposes ofthe Placing. Accordingly, the Board (other than Mr. Paul) is seekingShareholders' approval (pursuant to the Resolutions) to dis-apply pre-emptionrights at the EGM to facilitate the Placing. 5. Extraordinary General Meeting Notice of the Extraordinary General Meeting to be held at 21 Tudor Street,London EC4Y 0DJ at 11:00 a.m. on 15 November 2006 was today sent to Shareholdersat which one ordinary resolution and one special resolution will be proposed asfollows: ORDINARY RESOLUTION 1. in addition to the authority granted at the Company's last annualgeneral meeting, to grant the Directors a general authority pursuant to Section80 of the Act to allot relevant securities (within the meaning of Section 80(2)of the Act) of the Company up to an aggregate nominal amount equal to £509,091,representing 17.3 per cent. of the Existing Ordinary Shares as at 20 October2006 (being the last practicable date prior to the publication of this circular)all of which will be used for the Placing). SPECIAL RESOLUTION 2. to dis-apply statutory pre-emption rights in relation to shares witha nominal value of £509,091 representing 17.3 per cent. of the Existing OrdinaryShares as at 20 October 2006 (being the last practicable date prior to thepublication of this circular) and representing the allotments contemplated inthis letter pursuant to the Placing. 6. Further Information For further information, please contact: Tissue Science Laboratories PlcMartin Hunt, Chief Executive 01252 369603 Nomura Code Securities LimitedJuliet Thompson 0207 7761204Clare Terlouw 0207 7761205 Hogarth Partnership LimitedJames Longfield 0207 357 9477Sarah Richardson Nomura Code Securities Limited, which is authorised and regulated by theFinancial Services Authority, is acting for the Company and no other person inconnection with the Placing and will not be responsible to anyone other than theCompany for providing the protections afforded to customers of Nomura CodeSecurities Limited nor for advising any other person on the contents of thisannouncement or any matters described in this announcement. This announcement does not constitute, or form any part of, an offer orsolicitation of an offer to subscribe for the New Ordinary Shares. 7. Definitions "Act" the Companies Act 1985 (as amended); "Admission" admission of the New Ordinary Shares to trading on AIM and such admission becoming effective in accordance with the AIM Rules; "AIM" the market of that name operated by the London Stock Exchange; "AIM Rules" the AIM Rules for Companies published by the London Stock Exchange as in force at the date of this document or, where the content requires, as amended or modified after the date of this announcement; "Board" or the board of directors of the Company;"Directors" "Circular" the circular sent to Shareholders on the date of this announcement; "Company" or Tissue Science Laboratories;"TSL" "CREST" means the computer-based system established under the Uncertificated Securities Regulations 2001 which enables title to units of relevant securities (as defined in the Regulations) to be evidenced and transferred without a written instrument and in respect of which CRESTCo Limited is the Operator (as defined in the Regulations); "Existing Ordinary the 29,510,747 Ordinary Shares in issue at the date of thisShares" document; "Extraordinary the extraordinary general meeting of the Company to be heldGeneral Meeting" at 21 Tudor Street, London EC4Y 0DJ at 11:00 a.m. on 15or "EGM" November 2006; "New Ordinary the 5,090,910 Ordinary Shares to be issued pursuant to theShares" Placing; "Ordinary ordinary shares of 10p each in the capital of the Company;Shares" "Placing" the underwritten placing by Nomura Code of the New Ordinary Shares at the Placing Price; "Placing the agreement dated today, a summary of which is set out inAgreement" paragraph 2 of this announcement; "Placing Price" the price at which the New Ordinary Shares will be issued pursuant to the Placing, being 55p per New Ordinary Share; "Resolutions" the special resolution and the ordinary resolution to be proposed at the EGM; "Shareholders" holders of Ordinary Shares as at the date of this announcement. 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