SerVision plc Subscription - Receipt of Second Payment (2077G)

TIDMSEV

RNS Number : 2077G

SerVision plc

25 May 2017

The information contained within this announcement is deemed by the Group to constitute inside information as stipulated under the Market Abuse Regulations (EU) No. 596/2014 ("MAR").

25 May 2017

SerVision plc

("SerVision" or "the Company")

Further Re. Subscription to Raise $2.0 million and Issue of Equity

Receipt of funds

SerVision (AIM: SEV), a leader in mobile live video streaming over wireless and cellular networks, announces that, further to the announcements of 22 February 2017, 1 March 2017 and 9 March 2017 regarding the $2.0 million of new capital from Cascade SVP, LLC ("Cascade"), a US-based fund, the Company has received the second payment of $1.0 million from Cascade. Consequently, the Company has today allotted to Cascade 7,107,850 new ordinary shares at a price of 11.3 pence per share (the "New Ordinary Shares").

The proceeds, together with internally generated cashflow, will be used to provide working capital to finance the sales of the IVG400-N product, particularly into the bus and coach market, and to reduce the Company's debt position including the scheduled repayment of its facility with CSS Alpha (BVI) Ltd and YA II PN Ltd. A total of $125,000 and $475,000 remains outstanding on these respective loans as at the date of this announcement.

Proposed move to the Standard List

A condition of the investment by Cascade was that if the Company's ordinary shares are not listed on either the Main Market of the London Stock Exchange ("LSE") or on Nasdaq, or if the Company has not been sold for a price higher than the issue price of the subscription, before 21 February 2019, then any new capital raised by the Company thereafter must first be used to buy back the Subscription Shares, together with any new ordinary shares issued pursuant to the Options, that are still held by Cascade at the same price(s) as they were issued.

In light of this condition, the Company today announces that it intends to apply for a Standard Listing on the Main Market of the LSE, in which respect a prospectus will first need to be published, during the first half of 2018. This timing should allow the Company to publish its accounts for the 12 months ended 31 December 2017 for inclusion in the required prospectus.

In order to apply for admission to the Standard segment of the LSE, the Company must meet certain eligibility criteria. The Company intends to apply to the Financial Conduct Authority in this respect in the next few months.

General meeting

As announced on 22 February 2017, Cascade has been granted an option to invest up to a further $4.0 million, in two equal tranches, at the same Company valuation as the subscription, being approximately GBP14.4 million (the "Options"). Further details on the Options are contained in the announcement of 22 February 2017 and, as announced on 9 March 2017, the option prices per share have been adjusted to 10.13p and 9.21p respectively.

In order to be able to grant the Options, and issue new ordinary shares pursuant to any future exercise of the Options, the Company will need to convene a general meeting proposing that shareholders approve an increase in its authorities to grant rights to subscribe for new ordinary shares.

The Company intends to publish a circular convening a general meeting in June 2017. The original intention had been for the Company to have convened the general meeting by now however, after further consideration, the board decided to wait until following receipt of the second tranche of the subscription before so doing. A further announcement will be made at the time of posting of the circular to shareholders.

Guarantee

The Company is pleased to confirm that the personal guarantee previously provided by Gidon Tahan (Chairman and CEO of SerVision) in connection with the subscription has ceased following the issue of the New Ordinary Shares to Cascade. Gidon Tahan received no payment nor any other benefit for providing this guarantee.

Admission of the New Ordinary Shares to trading on AIM

Following receipt of the second $1.0 million from Cascade, application has been made to the London Stock Exchange for the 7,107,850 New Ordinary Shares to be admitted to trading on AIM ("Admission"). The New Ordinary Shares will rank pari passu in all respects with the existing ordinary shares of the Company. It is expected that Admission will become effective and that dealings in the New Ordinary Shares will become effective at 8.00 a.m. on 31 May 2017.

Major shareholdings

Following the issue of the New Ordinary Shares, Cascade will have a beneficial interest in 14,215,700 ordinary shares of 1 pence each in the Company ("Ordinary Shares") representing 10.0 per cent. of the enlarged share capital of the Company.

Total voting rights

Following Admission of the New Ordinary Shares, the Company's issued ordinary share capital will consist of 142,157,000 Ordinary Shares with one voting right per share. The Company does not hold any Ordinary Shares in treasury. Therefore, the total number of Ordinary Shares and voting rights in the Company will be 142,157,000. This figure may be used by shareholders in the Company as the denominator for the calculations by which they will determine if they are required to notify their interest in, or a change to their interest in, the share capital of the Company.

-ends-

For further information:

 
SerVision plc                        [phone] 
Gidon Tahan, Chairman and CEO 
Allenby Capital Limited (Nominated   [phone] 
 Adviser and Joint Broker)                     5656 
Nick Athanas / James Reeve 
 
 
Beaufort Securities Limited (Joint 
 Broker) 
                                     [phone] 
Elliot Hance                                   8300 
 
 
Leander PR (Financial PR) 
                             [phone] 
Christian Taylor-Wilkinson               157 
 

Notes to Editors

SerVision is a pioneer in the field of security communications technology and a leading developer and manufacturer of fully integrated video recording and transmission systems for homeland security and transportation applications. The Company's core technology is proprietary video compression which is optimised for streaming real-time video over any type of cellular or narrowband network.

This information is provided by RNS

The company news service from the London Stock Exchange

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May 25, 2017 02:38 ET (06:38 GMT)