Source - LSE Regulatory
RNS Number : 4833L
City of London Group PLC
13 September 2021
 

THIS ANNOUNCEMENT AND THE INFORMATION CONTAINED HEREIN IS RESTRICTED AND IS NOT FOR PUBLICATION, RELEASE OR DISTRIBUTION, DIRECTLY OR INDIRECTLY, IN WHOLE OR IN PART, IN OR INTO THE UNITED STATES OF AMERICA, AUSTRALIA, CANADA, JAPAN, THE REPUBLIC OF SOUTH AFRICA OR ANY OTHER JURISDICTION IN WHICH SUCH PUBLICATION, RELEASE OR DISTRIBUTION WOULD BE PROHIBITED BY ANY APPLICABLE LAW.

THIS ANNOUNCEMENT DOES NOT CONSTITUTE AN OFFER TO SELL OR ISSUE OR THE SOLICITATION TO BUY, SUBSCRIBE FOR OR OTHERWISE ACQUIRE ANY ORDINARY SHARES OR WARRANTS OF CITY OF LONDON GROUP PLC. ANY OFFER THAT MAY BE MADE WILL BE MADE PURSUANT TO THE CIRCULAR (AND THE TERMS AND CONDITIONS CONTAINED THEREIN) WHICH IS EXPECTED TO BE DISPATCHED TO QUALIFYING SHAREHOLDERS ON 14 SEPTEMBER 2021.

13 September 2021

 

CITY OF LONDON GROUP PLC

("COLG" or "the Company")

Open offer update

On 23 August 2021 the Board announced its intention to undertake an Open Offer to Qualifying Shareholders. Shareholder approval to grant authority to the Directors to allot the Open Offer Shares and new Ordinary Shares which may be issued upon exercise of the Open Offer Warrants was obtained at the General Meeting held on 8 September 2021. The Open Offer will give Qualifying Shareholders the opportunity to invest in new Ordinary Shares at the same price as PV27 and MBIL under the Subscription. Qualifying Shareholders will have the opportunity to subscribe for an aggregate of up to 11,299,988 Open Offer Shares to raise gross proceeds of up to £6.78 million

Successful applicants in the Open Offer will also receive Open Offer Warrants on the same basis as PV27 and MBIL under the Subscription (one Open Offer Warrant for every two Open Offer Shares subscribed) with such Warrants having substantially the same terms as the Subscription Warrants.

The Company confirms that a circular, which contains further details regarding the Open Offer will be posted on 14 September 2021, along with the Application Form. The Circular will also be made available on the Company's website https://cityoflondongroup.com/new-investor/.

Please see below the expected timetable of principal events. Further information is provided in the Appendix to this announcement.

Event

Date and Time (2021)

Record Date for entitlement under the Open Offer                                                            

Close of business on 10 September

Posting of the Circular and Application Forms

14 September

Ex-Entitlement Date                                                                                                                      

7:00am on 14 September

Open Offer Entitlements and Excess CREST Open Offer Entitlements credited to stock accounts in CREST of Qualifying CREST Shareholders

15 September

Latest recommended time and date for requesting withdrawal of Open Offer Entitlements and Excess CREST Open Offer Entitlements from CREST

4:30pm on 22 September

Latest time for depositing Open Offer Entitlements and Excess CREST Open Offer Entitlements into CREST

3:00pm on 23 September

Latest time and date for splitting Application Forms (to satisfy bona fide market claims)

3:00pm on 24 September

Latest time and date for receipt of completed Application Forms and payment in full from Qualifying Shareholders under the Open Offer or settlement of relevant CREST instruction (as appropriate)

11:00am on 28 September

Announcement of results of Open Offer

29 September

Admission effective and dealings in the Open Offer Shares expected to commence on AIM

8:00am on 5 October

Expected date for crediting of the Open Offer Shares in uncertificated form to CREST stock options

5 October

Expected date of dispatch of share certificates in respect of the Open Offer Shares

Within 10 business days

Expected date of dispatch of warrant certificates

Within 10 business days

The dates set out in the Expected Timetable of Principal Events above and in the Circular may be adjusted by the Company in which event details of the new dates will be notified to AIM and, where appropriate, to Shareholders. All references to time are to the time in London, England.

 

For further information, please contact:

City of London Group plc

Michael Goldstein, Chief Executive Officer

Ben Peters, Director of Investor Relations

 

 +44 (0)20 3988 6501

 +44 (0)20 3988 6500

 

Peel Hunt LLP (Nominated Adviser and Joint Broker)

+44 (0)20 7418 8900

James Britton, Rishi Shah

 

 

For media enquiries, please contact:

Heather Armstrong

Tim Pearson

 

 

heather.armstrong@tavistock.co.uk / 07929-116860

Or email   colg@tavistock.co.uk

     

 

 

 

APPENDIX

THIS APPENDIX DOES NOT CONSTITUTE AN OFFER TO SELL OR ISSUE OR THE SOLICITATION TO BUY, SUBSCRIBE FOR OR OTHERWISE ACQUIRE ANY ORDINARY SHARES OR WARRANTS OF CITY OF LONDON GROUP PLC. ANY OFFER THAT MAY BE MADE WILL BE MADE PURSUANT TO THE CIRCULAR (AND THE TERMS AND CONDITIONS CONTAINED THERIN) WHICH IS EXPECTED TO BE DISPATCHED TO QUALIFYING SHAREHOLDERS ON 14 SEPTEMBER 2021.

THE FOLLOWING DETAILS OF THE OPEN OFFER ARE PROVIDED FOR INFORMATION ONLY. QUALIFYING SHAREHOLDERS TO WHOM AN OFFER IS MADE UNDER THE CIRCULAR MUST READ THE CIRCULAR IN WHOLE. THE CIRCULAR IS EXPECTED TO BE DISPATCHED ON OR AROUND 14 SEPTEMBER 2021.

 

 

 

 

DEFINED TERMS IN THE APPENDIX

Term

Definition

"Act"

the UK Companies Act 2006, as amended;

"Admission"

the admission of the Open Offer Shares to trading on AIM becoming effective in accordance with the AIM Rules for Companies;

 

"AIM"

the market of that name operated by the London Stock Exchange;

"AIM Rules for Companies"

the rules which set out the obligations and responsibilities in relation to companies whose shares are admitted to AIM as published by the London Stock Exchange from time to time;

 

"Application Form"

the application form for use in the Open Offer;

 

"Articles of Association"

the articles of association of the Company as at the date of the Circular;

 

"Board"

the board of directors of the Company for the time being;

 

"Business Day"

a day other than a Saturday, Sunday or public holiday on which banks are open for commercial business in the City of London;

 

"Certificated" or "in Certificated Form"

 

 

a share or other security recorded on the relevant register of the relevant company as being held in certificated form and title to which may be transferred by means of a stock transfer form;

 

"Circular"

the circular to be dispatched to Qualifying Shareholders on or around 14 September 2021 under which the Open Offer is made, and subject to the terms and conditions as set out in that circular;

 

"Company" or "COLG"

City of London Group plc, a company registered in England and Wales with registered number 01539241;

 

"CREST"

the relevant system (as defined in the CREST Regulations) in respect of which Euroclear is the Operator (as also defined in the CREST Regulations);

"CREST Manual"

the rules governing the operation of CREST as published by Euroclear;

"CREST Member"

a person who has been admitted to CREST as a system-member (as defined in the CREST Manual);

 

"CREST Participant"

a person who is, in relation to CREST, a system-participant (as defined in the CREST Regulations);

 

"CREST payment"

shall have the meaning given in the CREST Manual;

"CREST Regulations"

the Uncertificated Securities Regulations 2001 (SI 2001 No. 3755), as amended;

 

"CREST sponsor"

a CREST participant admitted to CREST as a CREST sponsor;

"CREST sponsored member"

a CREST member admitted to CREST as a sponsored member;

"Directors"

the directors of the Company at the date of the Circular;

"Enlarged Ordinary Share Capital"

 

 

the issued share capital of the Company upon Admission, comprising the Existing Ordinary Share Capital, the Subscription Shares, the new Ordinary Shares to be issued to the trustee of the Company's EBT and the Open Offer Shares;

 

"Euroclear"

Euroclear UK & Ireland Limited;

 

"Excess Application Facility"

the arrangement under which Qualifying Shareholders may apply for Open Offer Shares in excess of their Open Offer Entitlement provided that they have agreed to take up their Open Offer Entitlement in full and which may be subject to scaling back in accordance with the provisions of the Circular;

 

"Excess CREST Open Offer Entitlement"

 

 

in respect of a Qualifying CREST Shareholder, the entitlement (in addition to their Open Offer Entitlement) to apply for Open Offer Shares, credited to their stock account in CREST, under the Excess Application Facility, which is conditional on such Qualifying CREST Shareholder agreeing to take up its Open Offer Entitlement in full and which may be subject to scaling back in accordance with the provisions of the Circular;

 

"Excess Shares"

the Open Offer Shares for which Qualifying Shareholders may apply under the Excess Application Facility;

"Existing Ordinary Shares"

the Ordinary Shares in issue as at the date of the Circular;

"Existing Ordinary Share Capital"

the issued ordinary share capital of the Company at the date of the  Circular, comprising 85,879,913 Ordinary Shares;

 

"FCA"

the United Kingdom Financial Conduct Authority;

"FSMA"

the Financial Services and Markets Act 2000 of the United Kingdom, as amended;

"General Meeting"

the general meeting of the Company, held at 10.00 a.m. on 8 September 2021;

 

"Group"

a company and its subsidiary undertakings from time to time;

"Issue Price"

60 pence being the price at which the Open Offer Shares are to be issued;

 

"Lapse Date"

the date on which an Open Offer Warrant lapses, being the date that is 3 years after the issue of the Open Offer Warrant;

 

"London Stock Exchange"

London Stock Exchange plc;

"MBIL"

Max Barney Investments Limited, a company registered in England and Wales with registered number 10890765;

 

"Official List"

the official list of the UKLA;

"Open Offer"

the invitation under the Circular to Qualifying Shareholders to subscribe for Open Offer Shares at the Issue Price on the terms of and subject to the conditions set out or referred to in Part III of the Circular. 

 

"Open Offer Entitlement"

with respect to each Qualifying Shareholder, the pro rata entitlement to apply to subscribe for 1 Open Offer Share for every 7.6 Existing Ordinary Shares held by them on the Record Date pursuant to the Open Offer;

"Open Offer Shares"

up to 11,299,988 new Ordinary Shares which are the subject of the Open Offer;

 

"Open Offer Warrants"

up to 5,649,994 warrants to subscribe for new Ordinary Shares at a price of 69 pence with a 3 year exercise period, to be issued to Qualifying Shareholders participating in the Open Offer on the basis of one Open Offer Warrant for every two Open Offer Shares subscribed under the Open Offer;

 

"Ordinary Shares"

ordinary shares of 2 pence each in the share capital of the Company;

 

"Overseas Shareholders"

Shareholders who are resident in, or who are citizens of, or who have registered addresses in, territories other than the United Kingdom;

 

"Panel"

the UK Panel on Takeovers and Mergers;

 

"Peel Hunt"

Peel Hunt LLP, the Company's nominated adviser and broker;

 

"Qualifying CREST Shareholders"

Qualifying Shareholders whose Existing Ordinary Shares on the register of members of the Company on the Record Date are held in uncertificated form on CREST;

 

"Qualifying Non-CREST Shareholders"

 

Qualifying Shareholders whose Existing Ordinary Shares on the register of members of the Company on the Record Date are held in certificated form;

 

"Qualifying Shareholders"

holders of Existing Ordinary Shares on the register of members of the Company on the Record Date for the Offer (other than certain Overseas Shareholders);

 

"Receiving Agent"

Link Group, Corporate Actions;

"Record Date"

close of business on 10 September 2021, the time on which Qualifying Shareholders must be shown on the register of members of the Company to be eligible to participate in the Open Offer;

 

"Registrar"

Link Group, 10th Floor, Central Square, 29 Wellington Street, Leeds LS1 4DL;

 

"Restricted Jurisdiction"

each and any of Australia, Canada, Japan, the United States, the Republic of Ireland and the Republic of South Africa;

 

"Securities Act"

the United States Securities Act of 1933, as amended from time to time;

 

"Shareholders"

the persons who are registered as holders of the Ordinary Shares;

"Sterling" or "£"

 

"Subscription Admission"

 

the legal currency of the UK;

 

admission of the Subscription Shares to trading on AIM becoming effective in accordance with the AIM Rules for Companies;

 

"Subscription"

the subscriptions for the Subscription Shares and the issue of the Subscription Warrants pursuant to the capital raise announced on 23 August 2021;

 

"Subscription Shares"

the 18,916,667 new Ordinary Shares to be issued pursuant to the Subscriptions;

 

"Subscription Warrants"

the 9,458,333 Warrants to be issued to PV27 and MBIL in connection with the Subscriptions;

 

"Takeover Code" or "City Code"

the UK City Code on Takeovers and Mergers;

"UK" or "United Kingdom"

the United Kingdom of Great Britain and Northern Ireland;

"UKLA"

the United Kingdom Listing Authority, being the FCA acting in its capacity as the competent authority for the purposes of Part VI of FSMA;

 

"Uncertificated" or "in Uncertificated Form"

 

a share or other security recorded on the relevant register of the relevant company concerned as being held in uncertificated form in CREST and title to which, by virtue of the CREST Regulations, may be transferred by means of CREST;

 

"US" or "United States"

the United States of America, its territories and possessions and any states of the United States of America; and

 

"Warrants"

the warrants to subscribe for new Ordinary Shares at an exercise price of 69 pence per share, being either the Subscription Warrants or the Open Offer Warrants (as the context requires).

 

 

 

PART A - SUMMARY OF THE OPEN OFFER

 

Details of the Open Offer

Qualifying Shareholders will be offered the opportunity to apply for Open Offer Shares on the basis of:

1 Open Offer Share for every 7.6 Existing Ordinary Shares held

Qualifying Shareholders are being offered the opportunity to apply for additional Shares in excess of their Open Offer Entitlement to the extent that other Qualifying Shareholders do not take up their Open Offer Entitlement in full. In the event that applications under the Open Offer are received in excess of the 11,299,988 Open Offer Shares available, excess applications will be scaled back pro rata to Qualifying Shareholders' existing shareholdings.

In addition, successful applicants under the Open Offer will be issued with Open Offer Warrants, being warrants to subscribe for new Ordinary Shares. The Open Offer Warrants are exercisable within 3 years of issuance (on a monthly basis) at a price of 69 pence per Ordinary Share. The Open Offer Warrants will be issued on the basis of 1 Warrant for every 2 Open Offer Shares successfully subscribed.

At the General Meeting, shareholders approved the allotment of the Open Offer Shares and new Ordinary Shares that may be issued upon exercise of the Open Offer Warrants. However, the Open Offer is conditional on admission of the Open Offer Shares to trading on AIM becoming effective in accordance with the AIM Rules for Companies (Admission). It is expected that Admission will occur and dealings in the Open Offer Shares will commence on 5 October 2021. If such condition is not fulfilled on or before 8.00 am on 5 October 2021 (or such later date as the Company may reasonably decide) application monies are expected to be returned without interest and any Open Offer Entitlements and Excess CREST Open Offer Entitlements admitted to CREST will be disabled.

Assuming full take-up under the Open Offer, the issue of the Open Offer Shares will raise gross proceeds of approximately £6.78 million for the Company. The Open Offer Shares will, upon issue, rank pari passu in all respects with the Company's existing Ordinary Shares including the right to receive all dividends and other distributions declared, made or paid after their date of issue.

Holdings of Existing Ordinary Shares in certificated and uncertificated form will be treated as separate holdings for the purpose of calculating entitlements under the Open Offer, as will holdings under different designations and in different accounts.

Qualifying Shareholders should be aware that the Open Offer is not a rights issue. Accordingly, Qualifying Non-CREST Shareholders should note that their Application Forms are not negotiable documents and cannot be traded. Qualifying Non-CREST Shareholders should note that applications in respect of Open Offer Entitlements (or Excess Shares) may only be made by the Qualifying Non-CREST Shareholder originally entitled, or by a person entitled by virtue of a bona fide market claim in accordance with paragraph 3.1(b) of Part III of the Circular.

Excess Application Facility

The Excess Application Facility will enable Qualifying Shareholders, provided that they take up their Open Offer Entitlement in full, to apply for Excess Shares.

Qualifying Non-CREST Shareholders who wish to apply to acquire more than their Open Offer Entitlement should complete the relevant sections on the Application Form. Qualifying CREST Shareholders will have Excess CREST Open Offer Entitlements credited to their stock account in CREST and should refer to paragraph 3.2(g) of Part III of the Circular for information on how to apply for Excess Shares pursuant to the Excess Application Facility. Excess Shares will be available only and to the extent that applications by other Qualifying Shareholders are not made or are made for less than their Open Offer Entitlements. Once subscriptions by Qualifying Shareholders under their respective Open Offer Entitlements have been satisfied, such applications for Excess Shares will be scaled back pro rata to the number of Excess Shares applied for by Qualifying Shareholders under the Excess Application Facility.

Application will be made for the Open Offer Entitlements and Excess CREST Open Offer Entitlements in respect of Qualifying CREST Shareholders to be admitted to CREST. It is expected that such Open Offer Entitlements and Excess CREST Open Offer Entitlements will be admitted to CREST at 8.00 a.m. on 15 September 2021. Applications through the means of the CREST system may only be made by the Qualifying CREST Shareholder originally entitled or by a person entitled by virtue of a bona fide market claim.

Qualifying Non-CREST Shareholders will receive an Application Form with the Circular which sets out their entitlement to Open Offer Shares as shown by the number of Open Offer Entitlements allocated to them. Qualifying Non-CREST Shareholders should note that the Application Form is not a negotiable document and cannot be traded.

For Qualifying Non-CREST Shareholders, completed Application Forms, accompanied by full payment, should be returned by post or by hand (during normal business hours only) to Link Group, Corporate Actions, 10th Floor, Central Square, 29 Wellington Street, Leeds LS1 4DL so as to arrive as soon as possible and in any event so as to be received no later than 11.00 a.m. on 28 September 2021. For Qualifying CREST Shareholders the relevant CREST instructions must have been settled as explained in the Circular by no later than 11.00 a.m. on 28 September 2021.

If applications are made for less than all of the Open Offer Shares available, then the lower number of Open Offer Shares will be issued, and any outstanding Open Offer Entitlements will lapse.

Further information on the Open Offer and the terms and conditions on which it is made, including the procedure for application and payment, are set out in Parts III and IV of the Circular.

Warrants to subscribe for Ordinary Shares

The Open Offer Warrants will be issued to successful applicants under the terms of the Open Offer on the basis of 1 Warrant for every 2 Open Offer Shares subscribed provided that any fractional entitlements shall be ignored. The maximum number of Open Offer Warrants that may be issued under the Open Offer (and corresponding Ordinary Shares to be allotted pursuant to the exercise of the Warrants) is 5,649,994.

The Open Offer Warrants will be exercisable at the subscription price of 69 pence per Ordinary Share on a monthly basis until the Lapse Date and if not exercised prior to that date shall lapse. The minimum number of Warrants that may be exercised at any one time is 1,000 Warrants (or, if the holder holds less than 1,000 Warrants, the entire lesser amount).

No exercise of the Open Offer Warrants shall be permitted where such exercise would result in any person or persons acquiring or increasing control of the Company within the meaning given in sections 181 and 182 of the FSMA, without the relevant regulatory approval of such acquisition or increase of control having first been obtained and not having expired prior to such exercise.

The Open Offer Warrants will be exercisable immediately from the date of issue but will not be listed or admitted to trading. Definitive certificates in respect of the Warrants are expected to be dispatched within 10 Business Days of 5 October 2021.

Upon exercise of the Open Offer Warrants, the resulting new Ordinary Shares will be credited as fully paid and will rank pari passu in all respects with the Company's existing Ordinary Shares including the right to receive all dividends and other distributions declared, made or paid after their date of issue.

Admission to AIM and dealings in the Open Offer Shares

The Ordinary Shares are admitted to trading on AIM, a market operated by the London Stock Exchange. AIM is a market designed primarily for emerging or smaller companies to which a higher investment risk tends to be attached than to larger or more established companies. AIM securities are not admitted to the Official List of the UK Listing Authority.

The Open Offer is conditional on Admission. Applications will be made for the Open Offer Shares to be admitted to trading on AIM. The Ordinary Shares are not traded on any other recognised investment exchange and no application has been, or will be, made for the Open Offer Shares or the Existing Ordinary Shares to be admitted to trading on any other recognised trading exchange. It is expected that Admission of the Open Offer Shares will become effective and that dealings in the Open Offer Shares will commence on AIM on or around 8.00am 5 October 2021.

Undertakings in relation to the Open Offer

As participants under the Subscription, each of PV27 and MBIL has undertaken that they shall not subscribe for any of their pro-rata entitlement to Open Offer Shares, so that other shareholders of the Company will have a greater opportunity to apply to subscribe for shares over and above their pro-rata entitlements. Substantial shareholder DV4 Limited has also provided an undertaking not to subscribe for its pro-rata entitlement under the Open Offer.

Use of funds raised under the Open Offer

 

In line with the Company's strategy to establish a new UK SME bank via its subsidiary Recognise Bank Limited ("Recognise"), the proceeds of the capital raised under the Open Offer (after costs) will be used to meet capital requirements and lift deposit restrictions in order to obtain the full authorisation of Recognise Bank by the Prudential Regulation Authority ("PRA"). This in turn will enable Recognise to offer retail savings products to both personal and business customers.

The development of Recognise is central to the Company's strategy and in part addresses the funding gap experienced by underserved UK SMEs. As announced in November 2020, Recognise was granted Authorisation with Restrictions ("AwR") by the PRA, one of the first banks to be authorised post pandemic.

 

 

PART B - RISK FACTORS

RISKS RELATING TO AN INVESTMENT IN THE ORDINARY SHARES

General risks

An investment in the Company is only suitable for investors capable of evaluating the risks and merits of such investment who have sufficient resources to bear any loss that may result from the investment. A prospective investor should consider with care whether an investment in the Company is suitable for them in light of their personal circumstances and the financial resources available to them. Investors are therefore strongly recommended to consult an investment adviser authorise under FSMA, or such other similar body in their jurisdiction, who specialises in advising on investments in this nature before making their decision to invest.

Investment in the Company should not be regarded as short term in nature. There can be no guarantee that any appreciation in the value of the Company's investments will occur or that the commercial objectives of the Company will be achieved. Investors may not get back the full amount initially invested.

The prices of shares and the income derived from them can go down as well as up. Past performance is not necessarily a guide to the future.

Volatility of share price

The trading price of the Ordinary Shares may be subject to wide fluctuations in response to a number of events and factors, such as variations in operating results, announcements of innovations or new services by the Enlarged Group or its competitors, changes in financial estimates and recommendations by securities analysts, the share price performance of other companies that investors may deem comparable to the Company, news reports relating to trends in the Company's markets, large purchases or sales of Ordinary Shares, liquidity (or absence of liquidity) in the Ordinary Shares, currency fluctuations, legislative or regulatory changes and general economic conditions. These fluctuations may adversely affect the trading price of the Ordinary Shares, regardless of the Company's performance.

The following factors, in addition to other risks described within this section, may have a significant effect on the market price of the Ordinary Shares:

·      Variations in operating results;

·      Actual or anticipated changes in the estimates of operating results or changes in stock market conditions

·      Analyst recommendations regarding the Ordinary Shares, other comparable companies or the industry generally;

·      Market conditions in the industry, the industries of customers and the economy as a whole;

·      Changes in the market valuation of similar companies;

·      Trading volume of the Ordinary shares; and

·      Adoption or modification of regulations, policies, procedures or programs applicable to the Group's business. In addition, if the stock market in general experience loss of investor confidence, the trading price of the Ordinary Shares could decline for reasons unrelated to the Group's business, financial condition or operating results. The trading price of the Ordinary Shares might also decline in reaction to events that affect other companies in the industry, even if such events do not directly affect the Group. Each of these factors, among others, could harm the value of the Ordinary Shares.

Future sales of Ordinary Shares could adversely affect the price of the Ordinary Shares

There can be no assurance that the Company, the Directors or other Shareholders will not elect to sell their Ordinary Shares in the future. The sale of a significant number of Ordinary Shares in the public market, or the perception that such sales may occur, could materially adversely affect the market price of the Ordinary Shares. Sales by the Company's existing Shareholders could also make it more difficult for the Company to sell equity securities in the future at a time and price that it deems appropriate.

Dilution of Shareholders' interests as a result of additional equity fundraising

The Company may need to raise additional funds in the future to finance, among other things, working Capital, expansion of the Group, new acquisitions or the development of new products. If additional funds are raised through the issuance of new equity or equity-linked securities of the Company other than on a pro rata basis to existing Shareholders, the percentage ownership of the existing Shareholders may be reduced. Shareholders may also experience subsequent dilution and/or such securities may have preferred rights, options and pre-emption rights senior to the Ordinary Shares. The Company may also issue shares as consideration shares on acquisitions or investments which would also dilute Shareholders' respective shareholdings.

Dividends

There can be no assurance as to the level of future dividends. The declaration, payment and amount of any future dividends of the Company are subject to the discretion of the Shareholders or, in the case of interim dividends to the discretion of the Directors, and will depend upon, among other things, the Company's earnings, financial position, cash requirements, availability of profits and distributable reserves, as well as provisions for relevant laws or generally accepted accounting principles from time to time.

There can be no assurance that the Company will declare and pay, or have the ability to declare and pay, any dividends in the future.

RISKS RELATING TO THE GROUP AND ITS BUSINESS

Regulatory compliance

The Company operates, and the Group will operate, in a regulated industry. Several members of the Company's Group are authorised by the FCA to perform a number of regulated activities, and Recognise Bank Limited is authorised and regulated by the PRA to take deposits with restrictions.

The Group employs individuals who have experience of working in these regulated environments, and where appropriate will seek advice on its ongoing compliance obligations on a regular basis.

However, there is a risk that the Group may not be fully compliant with its obligations at all times and any non-compliance could subject the Group to fines, censure or a cancellation or variation of its permissions, any of which could have material adverse consequences for the continuation of its business in the future.

Competition

There may be existing or new competitors entering the Group's market segment with larger resources, greater market presence, better name recognition, economies of scale or a lower cost base than the Group. They could seek to copy or improve on the Group's business strategy which could adversely affect the Group's market shares.

Future funding requirements

In the longer term, the Group may need to raise additional funding to undertake development of future products or to expand the business. There is no certainty that this will be possible at all or that it will be possible on acceptable terms. In addition, the terms of any such financing may be dilutive to, or otherwise adversely affect Shareholders.

Attraction and retention of key management and employees

The successful operation of the Group will depend partly upon the performance and expertise of its current and future management and employees. The loss of the services of certain of these members of the Group's key management or employees or the inability to identify, attract and retain a sufficient number of suitably skilled and qualified employees may have a material adverse effect on the Group. Expansion of the Group may require considerable management time which may in turn inhibit management's ability to conduct the day to day business of the Company.

Credit Risk

Credit risk is the risk that a borrower fails to pay the interest or to repay the capital on the Group's loans and receivables, thereby giving rise to the Group incurring a financial loss on that borrower's account. The Group aims to manage the impact on profitability from defaults within a Board approved risk appetite through a prudent and stringent underwriting policy and case management when customers are in difficulty. It is exposed to the risk that customers owing the Group money will not fulfil their obligations. An increase in defaults among its customers may have a material adverse effect on the Group's performance. The Group regularly reviews its lending criteria as well as its credit exposure to all customers. However, default risk may arise from events which are outside the Group's control, primarily customer performance due to factors such as loss of employment, family circumstances, illness, business failure, adverse economic conditions or fraud.

The Group intends to focus its lending on its specific areas of expertise and continually stresses its portfolio to test resilience. The majority of the Group's lending is secured by tangible assets and amortised over the life of the assets. The credit risk from concentration is limited due to the size of the counterparty exposures, the loan amount, property type, business sector and geographical spread. In order to ensure that arrears are minimised, emphasis is placed on retaining a diversified portfolio, using prudent underwriting methods and resisting the inclination to increase credit risk in the quest for increased volumes of new business.

Capital Risk

Capital risk is the risk that the Group will have insufficient capital resources to support the business. The Group is subject to capital adequacy requirements. If the Group fails to meet its minimum regulatory capital requirements, this may result in corrective action or sanctions against it which could adversely impact its business and, in particular, its reputation. The Group may also experience increased requirements for capital as a result of new regulations.

A capital exposure arises when the Group has insufficient capital resources to support its strategic objectives and plans. This could arise due to the depletion of its capital resources, as a crystallisation of any risk to which it is exposed or an inability to raise capital.

The Group aims to maintain a sufficient level of capital above the total regulatory capital requirement and CRDIV capital buffers as detailed in the internal capital adequacy assessment process ('ICAAP').

The Group intends to monitor closely and regularly its capital and leverage ratios to ensure that it meets current and future regulatory requirements. It has supportive major shareholders who have participated in previous capital raisings, and is able to accumulate additional capital through profits and by raising new equity as a listed company on a recognised stock exchange. The Group is able to manage the demand for capital through management actions including adjusting its lending strategy and regularly conducts stress tests and sensitivity analyses on a forward-looking basis.

Effective management of the Group's capital is critical to its ability to operate its business and to pursue its strategy. The Directors set the Group's internal target amount of capital by taking account of its own assessment of the risk profile of the business, market expectations and regulatory requirements. If regulatory requirements as to capital levels increase, the Group may be required to increase its capital ratios. The Group may also need to increase its capital level in response to changing market conditions or expectations. If the Group is unable to increase its capital in response, it may no longer comply with regulatory requirements or satisfy market expectations related to its capital strength and, as a result, its business, financial condition, and results of operations and prospects may be adversely impacted. Any change that limits the Group's ability to effectively manage its capital (including, for example, reductions in profits and retained earnings as a result of credit losses, write-downs or otherwise, increases in risk-weighted assets, delays in the disposal of certain assets, or the inability to raise capital or funding through wholesale markets as a result of market conditions or otherwise) could have a material adverse effect on its business, financial condition, results of operations, liquidity and/or prospects.

Liquidity and funding risk

Liquidity and funding risk is the risk that the Group is not able to fund new business originations or meet cash flow or collateral obligations as they fall due without adversely affecting either its daily operations or its financial health. The Group intends at all times to maintain liquidity resources that are adequate, both as to amount and quality, to ensure that there is no significant risk that its liabilities cannot be met as they fall due.

The Group manages liquidity so that the Group can at all times meet its liabilities as they fall due in a scenario consistent with its standard pillar 1 and pillar 2 internal liquidity adequacy assessment process ("ILAAP") stress tests.

The Group seeks to manage the tenor of its funding so as to reduce liquidity risk. 

The Group maintains its liquidity resources in the form of high-quality liquid assets ("HQLA"). It is intended that the amount of these will, at all times, exceed the minimum required by the Overall Liquidity Adequacy Rule ('OLAR') and liquidity risk tolerance. The Group carries out forward modelling to identify liquidity mismatches.

Market and interest rate risk

Market risk is the risk of losses in on- and off-balance sheet positions arising from adverse movements in market prices.

The principal market risk to which the Group is exposed is Interest rate risk, the risk that the Group will be adversely affected by changes in the absolute level of interest rates, in the spread between two rates, in the shape of the yield curve or in any other interest rate relationship.

The Group manages the adverse impact on the Net Interest Margin caused by an increased cost of variable rate borrowings within Board approved interest rate risk limits. This includes the use of fixed rate funding.

To the extent that the Group's receivables may not be matched by deposits and borrowings at fixed rates the Group will be exposed to the risks of changes in market interest rates and might incur higher interest costs than anticipated which may have an adverse effect on the Group's profitability.

The Group does not trade wholesale financial instruments and therefore does not have a trading book. The Group does not operate in denominations other than sterling, and has no foreign exchange risk.

Operational risk including in the event of a failure of IT systems

Operational risk is the risk of loss arising from inadequate or failed controls or processes, people and systems or from external events. The Group maintains a strong internal control environment to mitigate operational risk which is inherent to its business activities and to minimise the financial impact of operational risk arising from risks such as IT disruption, human error, a breakdown of procedures, non-compliance with policy and internal or external fraud.

The principal operational risks which may result in financial loss, disruption or damage to the reputation of the Group include inability to continue or resume services to customers as a result of a disruption to business or IT system failures, cyber risks associated with malicious attacks on the confidentiality or integrity of electronic data, and external fraud arising from the act of deception or omission, including identity fraud and asset conversion. Any weakness in the Group's IT systems or operational processes could have an adverse effect on its ability to operate its business and meet customer needs.

The Group reviews IT system architecture to ensure systems are resilient and that the confidentiality, integrity and availability of critical systems and information assets are protected against cyber-attacks. It has invested in the protection of customer information, including limiting access to key systems and enhancing the security, durability and accessibility of critical information.

The Group maintains a strong internal control environment and adopts policies and procedures to detect and prevent the use of its business for operational risk, fraud, money laundering, facilitating tax evasion, bribery and activities prohibited by legal and regulatory requirements.

Legal and regulatory matters

The Company is subject to an onerous degree of regulation or legislation, and therefore, changes in or extensions of laws and regulations affecting the industry in which the Company operates and the rules of industry organisations could restrict or complicate the Company's business activities, with the potential to significantly increase compliance / legal costs.

 

 

 

PART C- SUMMARY OF THE TERMS AND CONDITIONS OF THE OPEN OFFER

The information below constitutes a summary of the Terms and Conditions of the Open Offer. The Terms and Conditions are set out in full at Part III of the Circular, including information on how applications and payments are to be made.

Introduction

The Open Offer provides an opportunity for Qualifying Shareholders to apply for, in aggregate, up to 11,299,988 Open Offer Shares pro rata (excepting fractional entitlements) to their current holdings and, pursuant to the Excess Application Facility, to apply for Excess Shares, in each case at the Issue Price in accordance with the terms of the Open Offer set out in Part III of the Circular. The Open Offer is not being underwritten.

In the event that applications for Open Offer are received in excess of the 11,299,988 Open Offer Shares available, excess applications will be scaled back pro rata to Qualifying Shareholders' existing shareholdings. Any monies received in respect of unsuccessful applications for Open Offer Shares as a result of scale back will be promptly returned to Shareholders.

The Open Offer Shares will, when issued and fully paid, rank equally in all respects with the Existing Ordinary Shares, including the right to receive all dividends or other distributions made, paid or declared, if any, by reference to a record date after the date of their issue.

The Record Date for entitlements under the Open Offer for Qualifying CREST Shareholders and Qualifying Non-CREST Shareholders is the close of business on 10 September 2021. Open Offer Entitlements attach only to Existing Ordinary Shares held by Qualifying Shareholders as at the Record Date. Application Forms are expected to be posted to Qualifying Non-CREST Shareholders on 14 September 2021 and Open Offer Entitlements and Excess CREST Open Offer Entitlements are expected to be credited to stock accounts of Qualifying CREST Shareholders in CREST by 8.00 a.m. on 15 September 2021.

Subject to availability, the Excess Application Facility will enable Qualifying Shareholders to apply for Excess Shares. For Qualifying Non-CREST Shareholders, further details in relation to the Excess Application Facility are set out in Part III of the Circular and in the Application Form.

The latest time and date for payment in full under the Open Offer and receipt of completed Application Forms or settlement of relevant CREST instructions (as appropriate) is expected to be 11.00 a.m. on 28 September 2021 with Admission and commencement of dealings in the Open Offer Shares expected to take place at 8.00 a.m. on 5 October 2021.

The Open Offer is conditional on Admission. It is expected that Admission will occur and dealings in the Open Offer Shares will commence on 5 October 2021. If such condition is not fulfilled on or before 8.00 am on 5 October 2021 (or such later date as the Company may reasonably decide) application monies are expected to be returned without interest by crossed cheque in favour of the applicant(s) (at the applicant's risk) by post as soon as practicable after that date and any Open Offer Entitlements admitted to CREST will be disabled. Any interest earned on the application monies will be retained for the benefit of the Company.

The Circular and, for Qualifying Non-CREST Shareholders only, the Application Form contains the formal terms and conditions of the Open Offer. Paragraph 3 of Part III of the Circular will give details of the procedure for application and payment for the Open Offer Shares including any Excess Shares applied for under the Excess Application Facility.

Any Qualifying Shareholder who has sold or transferred all or part of their registered holding(s) of Existing Ordinary Shares prior to the close of business on 10 September 2021 is advised to consult their stockbroker, bank or other agent through or to whom the sale or transfer was effected as soon as possible since the invitation to apply for Open Offer Shares under the Open Offer may be a benefit which may be claimed from them by the purchasers under the rules of the London Stock Exchange.

The Open Offer

Subject to the terms and conditions set out in the Circular (and, in the case of Qualifying Non-CREST Shareholders, in the Application Form), Qualifying Shareholders will be given the opportunity to apply for any number of Open Offer Shares at the Issue Price (payable in full on application and free of all expenses) up to a maximum of their pro rata entitlement to their holdings of Existing Ordinary Share as at the Record Date, payable in full on application. Qualifying Shareholders' basic entitlements shall be calculated on the basis of:

1 Open Offer Share for every 7.6 Existing Ordinary Shares

registered in the name of each Qualifying Shareholder on the Record Date.

In the event that applications under the Open Offer are received for an excess of the 11,299,988 Open Offer Shares available, excess applications will be scaled back pro rata to Qualifying Shareholders' existing shareholdings. Any monies received in respect of unsuccessful applications for Open Offer Shares as a result of scale back will be promptly returned to Shareholders.

Entitlements of Qualifying Shareholders will be rounded down to the nearest whole number of open Offer Shares and any fractional entitlements to Open Offer Shares that would otherwise have arisen will be aggregated and available under the Excess Application Facility. Qualifying Shareholders may apply to subscribe for less than their Open Offer Entitlement should they so wish. Qualifying Shareholders are also being given the opportunity, provided they take up any Open Offer Entitlement in full, to apply for Excess Shares through the Excess Application Facility.

If applications under the Excess Application Facility are received for more than the total number of Open Offer Shares available following take up of Open Offer Entitlements, such applications will be scaled back pro rata to the number of Excess Shares applied for by Qualifying Shareholders under the Excess Application Facility. Any monies received in respect of unsuccessful applications for Excess Shares will be promptly returned to Shareholders.

Paragraph 3.1(d) (Qualifying Non-CREST Shareholders) and 3.2(g) (Qualifying CREST Shareholders) of Part III of the Circular will set out further details of the Excess Application Facility.

Subject to any scale back, valid applications by Qualifying Shareholders will be satisfied in full up to the maximum amount of their individual Open Offer Entitlement (excluding any Excess Shares applied for through the Excess Application Facility). Holdings of Existing Ordinary Shares in certificated and uncertificated form will be treated as separate holdings for the purpose of calculating entitlements under the Open Offer, as will holdings under different designations and in different accounts.

To the extent that Qualifying Shareholders do not take up the offer of Open Offer Shares under the Open Offer, their proportionate ownership and voting interest in the Company will be reduced and the percentage that their shareholdings represent of the ordinary share capital of the Company will, following Admission, be reduced accordingly. Qualifying CREST Shareholders should note that, although the Open Offer Entitlements and Excess CREST Open Offer Entitlements will be credited to CREST and be enabled for settlement, applications in respect of the Open Offer may only be made by the Qualifying CREST Shareholder originally entitled or by a person entitled by virtue of a bona fide market claim in accordance with paragraph 3.2(b) of Part III of the Circular raised by CREST Claims Processing Unit.

Open Offer Shares not applied for under the Open Offer will not be sold in the market for the benefit of those who do not apply under the Open Offer and Qualifying Shareholders who are not eligible to or do not apply to take up Open Offer Shares will have no rights under the Open Offer nor receive any proceeds from it.

Application will be made for the Open Offer Entitlements and the Excess CREST Open Offer Entitlements to be credited to Qualifying CREST Shareholders' CREST accounts. The Open Offer Entitlements and the Excess CREST Open Offer Entitlements are expected to be credited to CREST accounts by 8.00 a.m. on 15 September 2021.

The Existing Ordinary Shares are in registered form, are admitted to trading on AIM and are not traded on any other exchange. Open Offer Shares will also be in registered form, will be issued credited as fully paid and will rank equally in all respects with the issued Existing Ordinary Shares. Open Offer Shares will be issued only pursuant to the Open Offer and, subject as set out in Part III of the Circular, will not otherwise be marketed or made available in whole or in part to the public.

Overseas Shareholders are referred to the section entitled "Overseas Shareholders" set out in paragraph 6 of Part III of the Circular.

Warrants to subscribe for Ordinary Shares

The Open Offer Warrants will be issued to successful applicants under the terms of the Open Offer on the basis of 1 Warrant for every 2 Open Offer Shares successfully subscribed provided that any fractional entitlements shall be ignored.

The Open Offer Warrants will be exercisable at the subscription price of 69 pence per new Ordinary Share on a monthly basis from time to time until the Lapse Date and if not exercised prior to that date shall lapse. The minimum number of Open Offer Warrants that may be exercised at any one time is 1,000 Warrants (if a holder holds less than 1,000 Warrants, then that entire lesser amount).

No exercise of the Open Offer Warrants shall be permitted where such exercise would result in any person or persons acquiring or increasing control of the Company within the meaning given in sections 181 and 182 of the FSMA, without the relevant regulatory approval of such acquisition or increase of control having first been obtained and not having expired prior to such exercise.

The Warrants will be exercisable immediately from the date of issue but will not be listed or admitted to trading. Definitive certificates in respect of the Warrants are expected to be dispatched within 10 business days of 5 October 2021.

Procedure for Application and Payment

The action to be taken by Qualifying Shareholders in respect of the Open Offer depends on whether, at the relevant time, a Qualifying Non-CREST Shareholder has an Application Form in respect of their Open Offer Entitlement, or a Qualifying CREST Shareholder has Open Offer Entitlements credited to their CREST stock account.

Qualifying Non-CREST Shareholders who hold all or part of their Existing Ordinary Shares in certificated form will receive the Application Form, enclosed with the Circular. The Application Form will show the number of Existing Ordinary Shares held at the Record Date. It will also show Qualifying Non-CREST Shareholders their Open Offer Entitlement that can be allotted in certificated form. Qualifying CREST Shareholders who hold all their Existing Ordinary Shares in CREST will be allotted Open Offer Shares in CREST.

Qualifying Shareholders who hold part of their Existing Ordinary Shares in uncertificated form will be allotted Open Offer Shares in uncertificated form to the extent that their entitlement to Open Offer Shares arises as a result of holding Existing Ordinary Shares in uncertificated form. However, it will be possible for Qualifying Shareholders to deposit Open Offer Entitlements into, and withdraw them from, CREST. Further information on deposit and withdrawal from CREST is set out in paragraph 3.2 of Part III in the Circular.

CREST sponsored members should refer to their CREST sponsor, as only their CREST sponsor will be able to take the necessary action specified in the Circular to apply under the Open Offer in respect of the Open Offer Entitlements of such members held in CREST. CREST members who wish to apply under the Open Offer in respect of their Open Offer Entitlements in CREST should refer to the CREST Manual for further information on the CREST procedures referred to in the Circular. 

Qualifying Shareholders wishing to take up or apply for Open Offer Shares under the Open Offer should refer to the Circular for detailed instructions as to application and payment.

Qualifying Shareholders who do not want to take up or apply for Open Offer Shares under the Open Offer should take no action and (if a Qualifying Non-CREST Shareholder) should not complete or return the Application Form.

No Public Offering

The Company has not taken, nor will take, any action in any jurisdiction that would permit a public offering of Open Offer Shares or Open Offer Warrants.

Overseas Shareholders

General

The distribution of the Circular and making of the Open Offer to Overseas Shareholders may be affected by the laws or regulatory requirements of the relevant jurisdiction. Overseas Shareholders who are in any doubt in this respect should consult their professional advisers. No person receiving a copy of the Circular and/or an Application Form and/or receiving a credit of Open Offer Entitlements and/or Excess CREST Open Offer Entitlements to a stock account in CREST in any territory other than the United Kingdom may treat the same as constituting an invitation or offer to them, nor should they in any event use such Application Form or credit of Open Offer Entitlements or Excess CREST Open Offer Entitlements to a stock account in CREST, unless, in the relevant territory, such an invitation or offer could lawfully be made to them or such Application Form or credit of Open Offer Entitlements or Excess CREST Open Offer Entitlements to a stock account in CREST could lawfully be used without contravention of any legislation or other local regulatory requirements. Receipt of the Circular and/or an Application Form or the crediting of Open Offer Entitlements and/or Excess CREST Open Offer Entitlements to a stock account in CREST does not constitute an invitation or offer to Overseas Shareholders in the territories in which it would be unlawful to make an invitation or offer and in such circumstances they are sent for information only. It is the responsibility of any person receiving a copy of the Circular and/or an Application Form and/or receiving a credit of Open Offer Entitlements and/or  Excess CREST Open Offer Entitlements to a stock account in CREST to satisfy themselves as to the full observance of the laws and regulatory requirements of the relevant territory in connection with any application for Open Offer Shares, including obtaining any governmental or other consents which may be required or observing any other formalities required to be observed in such territory and paying any issue, transfer or other taxes due in such other territory.

 

Persons (including, without limitation, stockbrokers, banks and other agents) receiving an Application Form and/or receiving a credit of Open Offer Entitlements and/or Excess CREST Open Offer Entitlements to a stock account in CREST should not, in connection with the Open Offer, distribute, communicate or send the Application Form or credit of Open Offer Entitlements and/or Excess CREST Open Offer Entitlements in a stock account in CREST into (or to any person subject to the laws of) any Restricted Jurisdictions or any other jurisdiction where to do so would or might contravene local securities laws or regulations.

 

If an Application Form or a credit of Open Offer Entitlements and/or Excess CREST Open Offer Entitlements to a stock account in CREST is received by any person in any such jurisdiction or by the stockbrokers, banks and other agents or nominees of such person, they must not seek to take up the Open Offer Shares except under an express written agreement with the Company. Any person who does distribute, communicate or send an Application Form or credit of Open Offer Entitlements and/or Excess CREST Open Offer Entitlements in a stock account in CREST into (or to any person subject to the laws of) any jurisdiction outside the UK, whether under a contractual or legal obligation or otherwise, should draw the attention of the recipient to the contents of paragraph 6 of Part III of the Circular. The Company will reserve the right to reject an application to subscribe for Open Offer Shares under any Open Offer Entitlement and/or Excess CREST Open Offer Entitlement, submitted by or on behalf of any person, in any such jurisdiction, or by or on behalf of any person who is acquiring Open Offer Shares or Open Offer Warrants for resale in any such jurisdiction.

 

The Company will reserve the right in its absolute discretion to treat as invalid any application for Open Offer Shares under the Open Offer if it appears to the Company and its agents that such application or acceptance of it may involve a breach of the laws or regulations of any jurisdiction or if in respect of such application the Company has not been given the relevant warranty concerning overseas jurisdictions set out in the Application Form or in the Circular, as appropriate.

 

All payments under the Open Offer must be made in Sterling.

United States

Accordingly, the Company is not extending the Open Offer into the United States and, subject to certain exceptions, none of the Circular, the Application Forms or the crediting of Open Offer Entitlements (or Excess CREST Open Offer Entitlements) to a stock account in CREST constitutes or will constitute an offer or an invitation to apply for an offer or an invitation to subscribe for any Open Offer Shares or Open Offer Warrants in the United States. Neither the Circular nor an Application Form will (unless an address within the United Kingdom for services of notices has been notified to the Company) be sent to, and no Open Offer Entitlements (or Excess CREST Open Offer Entitlements) will be credited to, a stock account in CREST of any Qualifying Shareholder with a registered address in the United States. Subject to certain exceptions, Application Forms sent from, or post-marked in, the United States will be deemed to be invalid and all persons subscribing for Open Offer Shares and Open Offer Warrants and wishing to hold such Open Offer Shares and Open Offer Warrants in registered form must provide an address for registration of the Open Offer Shares and Open Offer Warrants outside the United States.

Other Restricted Jurisdictions

Due to the restrictions under the securities laws of the Restricted Jurisdictions and subject to certain exemptions, Shareholders who have registered addresses in or who are resident or ordinarily resident in, or citizens of, any Restricted Jurisdiction will not qualify to participate in the Open Offer and will not be sent an Application Form and no Open Offer Entitlements or Excess CREST Open Offer Entitlements will be credited to their CREST stock accounts.

 

The Open Offer Shares and Open Offer Warrants have not been and will not be registered under the relevant laws of any Restricted Jurisdiction or any of their states, provinces or territories and may not be offered, sold, resold, delivered or distributed, directly or indirectly in or into any Restricted Jurisdiction or to, or for the account or benefit of, any person with a registered address in, or who is resident or ordinarily resident in, or a citizen of, any Restricted Jurisdiction except under an applicable exemption.

 

No offer of Open Offer Shares or Open Offer Warrants is being made by virtue of the Circular or the Application Forms into any Restricted Jurisdictions.

Settlement and Dealings

The result of the Open Offer is expected to be announced on 29 September 2021. Application will be made to the London Stock Exchange for Offer Shares to be admitted to trading on AIM. It is expected that Admission of Open Offer Shares will become effective and that dealings in Open Offer Shares will commence at 8.00 a.m. on 5 October 2021. Open Offer Entitlements and Excess CREST Open Offer Entitlements held in CREST are expected to be disabled in all respects after 11.00 a.m. on 28 September 2021 (the latest date for applications under the Open Offer). Subject to the satisfaction of the Admission condition of the Open Offer, Open Offer Shares will be issued in uncertificated form to those persons who submitted a valid application for Open Offer Shares by utilising the CREST application procedures and whose applications have been accepted by the Company. Link Group will instruct Euroclear to credit the appropriate stock accounts of such persons with such persons' entitlements to Open Offer Shares with effect from the date of Admission (expected to be 5 October 2021). The stock accounts to be credited will be accounts under the same participant IDs and member account IDs in respect of which the USE instruction was given.

 

For Qualifying Non-CREST Shareholders who have applied for Open Offer Shares using an Application Form and whose application has been accepted by the Company, share certificates for the Open Offer Shares issued to such Qualifying Shareholders, are expected to be dispatched by post within ten business days of Admission of Open Offer Shares. No temporary documents of title will be issued. Pending despatch of definitive share certificates, transfers of relevant Open Offer Shares by such Qualifying Shareholders will be certified against the register of members of the Company. All documents or remittances sent by or to an applicant (or their agent as appropriate) through the post are sent at the risk of the applicant.

 

Qualifying CREST Shareholders should note that they will be sent no confirmation of the credit of Open Offer Shares to their CREST stock account nor any other written communication by the Company in respect of the issue of Open Offer Shares.

 

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