Auto Trader Group plc Proposed placing of new ordinary shares (3685I)

TIDMAUTO

RNS Number : 3685I

Auto Trader Group plc

01 April 2020

THIS ANNOUNCEMENT AND THE INFORMATION CONTAINED HEREIN ARE NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, DIRECTLY OR INDIRECTLY, IN OR INTO THE UNITED STATES, AUSTRALIA, CANADA, JAPAN OR SOUTH AFRICA OR ANY JURISDICTION IN WHICH SUCH RELEASE, PUBLICATION OR DISTRIBUTION WOULD BE UNLAWFUL.

THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION FOR IMMEDIATE RELEASE.

1 April 2020

AUTO TRADER GROUP PLC

PROPOSED PLACING OF NEW ORDINARY SHARES

Auto Trader Group plc ("Auto Trader" or the "Company" or, together with its subsidiaries, the "Group"), the UK's largest digital automotive marketplace, today announces its intention to conduct a non-pre-emptive placing of up to 46,468,300 new ordinary shares of one pence per share (the "Placing Shares"), representing approximately 5% of the current issued share capital of the Company, with institutional investors (the "Placing"). The Placing will be conducted through an accelerated bookbuilding process which will be launched immediately following this announcement, in accordance with the terms and conditions of the Placing set out in the Appendix.

Rationale for the Placing and Use of Proceeds

The Group's balance sheet is strong. At the end of February, the Group had drawings of GBP289 million from a GBP400 million revolving credit facility, with a net debt/EBITDA ratio of 1.1x, well below the covenant level of 3.5x. Covenants are tested in March and September and look at a rolling 12 month period. As well as debt cover, the test includes interest cover for which the last 12 months' EBITDA must be at least 3x the net interest expense. The Group expects to meet the March 2020 test with significant headroom available. Looking forward to the Group's September 2020 covenant test, the Board expects the Group's net debt/EBITDA ratio to rise as a function of the free services being provided to the Group's customers but will remain well below the maximum covenant threshold.

The Board believes it is important to support the Group's customers and employees through this period of uncertainty. The Board also believes there may be attractive opportunities to strengthen the business in the immediate aftermath of the current crisis. The Board believes it is in the best long-term interests of all stakeholders to strengthen the Group's balance sheet today and ensure the Group avoids constraints that might otherwise be imposed in the medium term in order to meet debt covenants.

Consequently, the net proceeds of the Placing will be used to strengthen the Group's balance sheet and liquidity position, support all stakeholders, increase the Group's flexibility to take advantage of future opportunities, and increase certainty around meeting covenant tests in future years. Furthermore, this equity raise will allow the Group to resume its existing capital return policy at the earliest prudent opportunity.

Update on Current Trading

Auto Trader has separately today provided a trading update in light of the evolving COVID-19 pandemic. This update details action already taken by the Group to support customers, as previously announced on 19 March 2020, as well as further actions to be taken by the Group to reduce costs during this time of uncertainty.

Details of the Placing

BofA Securities is acting as sole bookrunner and corporate broker in connection with the Placing.

The Placing is subject to the terms and conditions set out in the Appendix (which forms part of this announcement, such announcement and the Appendix together being the "Announcement"). BofA Securities will today commence a bookbuilding process in respect of the Placing (the "Bookbuilding Process"). The price per ordinary share in the Company at which the Placing Shares are to be placed (the "Placing Price") will be decided at the close of the Bookbuilding Process. The book will open with immediate effect following this Announcement. The timing of the closing of the book, pricing and allocations will be at the discretion of BofA Securities and Auto Trader. Details of the Placing Price and the number of Placing Shares will be announced as soon as practicable after the close of the Bookbuilding Process.

The Placing Shares, when issued, will be fully paid and will rank pari passu in all respects with the existing ordinary shares in the Company, including the right to receive all dividends and other distributions declared, made or paid after the date of issue. The number of Placing Shares will not exceed approximately 5.0% of the current issued share capital of the Company.

Applications will be made for the Placing Shares to be admitted to the premium listing segment of the Official List (the "Official List") of the Financial Conduct Authority (the "FCA") and to be admitted to trading on the main market for listed securities of London Stock Exchange plc (the "London Stock Exchange") (together, "Admission"). Settlement for the Placing Shares and Admission is expected to take place on or before 8.00 a.m. on 3 April 2020. The Placing is conditional, among other things, upon Admission becoming effective and the placing agreement between the Company and BofA Securities (as sole bookrunner) (the "Placing Agreement") not being terminated in accordance with its terms. As part of the Placing, the Company has agreed that it will not issue or sell Ordinary Shares for a period ending 180 days after Admission, without the prior written consent of BofA Securities. The Appendix sets out further information relating to the Bookbuilding Process and the terms and conditions of the Placing.

Shareholder Consultation

The Company has consulted with a number of its leading shareholders regarding the rationale for the Placing and its non-pre-emptive nature ahead of this announcement. The Board's belief that the Placing is in the best interests of shareholders and will promote the success of the Company has been strengthened by these discussions.

The proposed issue and allotment of the Placing Shares is within the existing shareholder authorities granted to the Company at its Annual General Meeting held on 19 September 2019.

This Announcement should be read in its entirety. In particular, you should read and understand the information provided in the "Important Notice" section of this Announcement. Investors will be deemed to have read and understood this Announcement in its entirety (including the Appendix) and to be making an offer to subscribe for Placing Shares on the terms and conditions and providing the representations, warranties, acknowledgements and undertakings contained in the Appendix.

The person responsible for arranging release of this Announcement on behalf of Auto Trader is Claire Baty.

For further information on the Announcement, please contact

Auto Trader Group plc: [phone]

Nathan Coe, Chief Executive

Jamie Warner, Chief Financial Officer

BofA Securities: [phone]

Peter Luck

Richard Abel

Daniel Burton-Morgan

IMPORTANT NOTICE

This Announcement is being issued by and is the sole responsibility of the Company. No representation or warranty, express or implied, is or will be made as to, or in relation to, and no responsibility or liability is or will be accepted by Merrill Lynch International ("BofA Securities") or any of its affiliates or agents (or any of its respective directors, officers, employees or advisers) for the truth, accuracy or completeness of the information contained in this Announcement (or whether any information has been omitted from the Announcement), or any other written, oral, visual or electronic information made available to or publicly available (howsoever transmitted) to any interested party or its advisers, or any other statement made or purported to be made by or on behalf of BofA Securities or any of its affiliates in connection with the Company, the Placing Shares or the Placing and any responsibility therefor is expressly disclaimed. BofA Securities and its respective affiliates accordingly disclaim all and any liability, whether arising in tort, contract or otherwise (save as referred to above) in respect of the use of this Announcement, or any statements or other information contained (or omitted) in this Announcement or otherwise arising in connection therewith and no representation or warranty, express or implied, is made by BofA Securities or any of its affiliates as to the accuracy, completeness or sufficiency of the information contained in this Announcement.

No action has been taken by the Company or BofA Securities, or any of their respective affiliates that would, or which is intended to, permit a public offer of the Placing Shares in any jurisdiction or result in the possession or distribution of this Announcement or any other offering or publicity material relating to the Placing Shares in any jurisdiction where action for that purpose is required. Any failure to comply with these restrictions may constitute a violation of the securities laws of such jurisdictions. Persons into whose possession this Announcement comes shall inform themselves about, and observe, such restrictions.

No prospectus will be made available in connection with the matters contained in this Announcement and no such prospectus is required (in accordance with the Prospectus Regulation) to be published. Persons needing advice should consult an independent financial adviser.

THIS ANNOUNCEMENT IS FOR INFORMATION PURPOSES ONLY AND DOES NOT CONSTITUTE OR FORM PART OF ANY OFFER OR INVITATION TO UNDERWRITE, BUY, SUBSCRIBE, SELL OR ISSUE OR THE SOLICITATION OF AN OFFER TO BUY, SELL, ACQUIRE, DISPOSE OR SUBSCRIBE FOR THE PLACING SHARES OR ANY OTHER SECURITY IN THE UNITED STATES (INCLUDING ITS TERRITORIES AND POSSESSIONS, ANY STATE OF THE UNITED STATES AND THE DISTRICT OF COLUMBIA, COLLECTIVELY THE "UNITED STATES"), AUSTRALIA, CANADA, JAPAN OR SOUTH AFRICA OR IN ANY JURISDICTION IN WHICH, OR TO ANY PERSONS TO WHOM, SUCH OFFERING, SOLICITATION OR SALE WOULD BE UNLAWFUL. THE INFORMATION CONTAINED IN THIS ANNOUNCEMENT IS NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION TO PERSONS IN THE UNITED STATES OR AUSTRALIA, CANADA, JAPAN, SOUTH AFRICA, AND SHOULD NOT BE DISTRIBUTED, FORWARDED TO OR TRANSMITTED IN OR INTO ANY JURISDICTION, WHERE TO DO SO MIGHT CONSTITUTE A VIOLATION OF LOCAL SECURITIES LAWS OR REGULATIONS.

The Placing Shares have not been, and will not be, registered under the U.S. Securities Act of 1933, as amended, (the "Securities Act"), or under the securities laws of any state or other jurisdiction of the United States, and may not be offered or sold within the United States except pursuant to an applicable exemption from or in a transaction not subject to the registration requirements of the Securities Act and in compliance with any applicable securities laws of any state or other jurisdiction of the United States. There will be no public offering of the Placing Shares in the United States.

The relevant clearances have not been, and nor will they be, obtained from the securities commission of any province or territory of Canada; no prospectus has been lodged with, or registered by, the Australian Securities and Investments Commission or the Japanese Ministry of Finance; the relevant clearances have not been, and will not be, obtained for the South Africa Reserve Bank or any other applicable body in the Republic of South Africa in relation to the Placing Shares and the Placing Shares have not been; and the Placing Shares have not been, and nor will they be, registered under or offered in compliance with the securities laws of any state, province or territory of Canada, Australia, Japan or South Africa. Accordingly, the Placing Shares may not (unless an exemption under the relevant securities laws is applicable) be offered, sold, resold or delivered, directly or indirectly, in or into Canada, Australia, Japan or South Africa or any other jurisdiction outside the United Kingdom or to, or for the account or benefit of any national, resident or citizen of Australia, Japan or South Africa or to any investor located or resident in Canada.

BofA Securities is authorised by the Prudential Regulation Authority and regulated in the United Kingdom by the Financial Conduct Authority and the Prudential Regulation Authority. BofA Securities is acting as sole bookrunner and corporate broker for the Company in connection with the Placing, will not regard any other person as a client in relation to the Placing and will not be responsible to anyone other than the Company for providing the protections afforded to their clients nor for providing advice to any other person in relation to the Placing and/or any other matter referred to in this Announcement. Neither BofA Securities, nor any of its subsidiaries, branches or affiliates, nor any of its directors, officers or employees owes or accepts any duty, liability or responsibility whatsoever (whether direct or indirect, whether in contract, in tort, under statute or otherwise) to any person who is not a client of BofA Securities in connection with the Placing, this Announcement, any statement contained herein, or otherwise.

This Announcement does not identify or suggest, or purport to identify or suggest, the risks (direct or indirect) that may be associated with an investment in the Placing Shares. Any investment decision to buy Placing Shares in the Placing must be made solely on the basis of publicly available information, which has not been independently verified by BofA Securities.

This announcement may include statements that are, or may be deemed to be, "forward-looking statements". These forward-looking statements may be identified by the use of forward-looking terminology, including the terms "believes", "estimates", "plans", "projects", "anticipates", "expects", "intends", "may", "will" or "should" or, in each case, their negative or other variations or comparable terminology, or by discussions of strategy, plans, objectives, goals, future events or intentions. Forward-looking statements may and often do differ materially from actual results. Any forward-looking statements reflect the Company's current view with respect to future events and are subject to risks relating to future events and other risks, uncertainties and assumptions relating to the Group's business, results of operations, financial position, liquidity, prospects, growth or strategies. Forward-looking statements speak only as of the date they are made.

Each of the Company and BofA Securities and their respective affiliates expressly disclaims any obligation or undertaking to update, review or revise any forward-looking statement contained in this announcement whether as a result of new information, future developments or otherwise.

In connection with the Placing, BofA Securities and any of its affiliates, acting as investors for their own account, may take up a portion of the shares in the Placing as a principal position and in that capacity may retain, purchase, sell, offer to sell for their own accounts such shares and other securities of the Company or related investments in connection with the Placing or otherwise. Accordingly, references to Placing Shares being issued, offered, subscribed, acquired, placed or otherwise dealt in should be read as including any issue or offer to, or subscription, acquisition, placing or dealing by, BofA Securities and any of its affiliates acting in such capacity. In addition, BofA Securities and any of its affiliates may enter into financing arrangements (including swaps, warrants or contracts for differences) with investors in connection with which BofA Securities and any of its affiliates may from time to time acquire, hold or dispose of shares. BofA Securities does not intend to disclose the extent of any such investment or transactions otherwise than in accordance with any legal or regulatory obligations to do so.

The most recent Annual and Interim Reports of the Group and other information about the Group are available on the Company website at https:// plc.autotrader.co.uk/investors . Neither the contents of the Company's website nor any website accessible by hyperlinks on the Company's website is incorporated in, or forms part of, this Announcement.

This Announcement does not constitute a recommendation concerning the Placing.

APPIX

TERMS AND CONDITIONS OF THE PLACING

IMPORTANT INFORMATION FOR PLACEES ONLY REGARDING THE PLACING

Details of the Placing

Merrill Lynch International ("BofA Securities") has today entered into an agreement with Auto Trader Group plc (the "Company") (the "Placing Agreement") under which, subject to the conditions set out in that agreement, BofA Securities, as agent for and on behalf of the Company, has agreed to use its reasonable endeavours to procure placees (the "Placees") for the Placing Shares (the "Placing") at a price to be determined following completion of the bookbuilding process in respect of the Placing (the "Bookbuilding Process"), described in this Announcement and set out in the Placing Agreement.

The Company has appointed BofA Securities as underwriter for the purposes of underwriting the Placing, to the extent the number and price of the Placing Shares to be placed with the Placees is agreed between BofA Securities and the Company and set out in an executed version of the terms of the Placing (the "Placing Terms"), in accordance with the terms of the Placing Agreement, and BofA Securities has accepted such appointment in connection with the Placing relying on the representations and warranties and subject to the terms and conditions set out in the Placing Agreement.

The new ordinary shares of one pence each in the Company to be issued pursuant to the Placing (the "Placing Shares") have been duly authorised and will, when issued, be credited as fully paid and will rank pari passu in all respects with the existing issued ordinary shares of one pence each in the Company (the "Ordinary Shares"), including the right to receive all dividends and other distributions declared, made or paid in respect of such Ordinary Shares after the date of issue of the Placing Shares.

The Placing Shares will be issued free of any pre-emption rights, encumbrance, lien or other security interest. The Company confirms that it is entitled to allot the Placing Shares pursuant to section 551 of the Companies Act 2006 as amended, as if section 561 of that Act did not apply to such allotment.

Application for listing and admission to trading

Application will be made to the Financial Conduct Authority ("FCA") for admission of the Placing Shares to the Official List (the "Official List") of the FCA and to be admitted to trading on the main market for listed securities of the London Stock Exchange plc (the "London Stock Exchange") ("Admission"). It is expected that Admission will become effective on or before 8.00 a.m. on 3 April 2020 (the "Closing Date") and that dealings in the Placing Shares will commence at that time.

Bookbuilding Process

BofA Securities will today commence the Bookbuilding Process to determine demand for participation in the Placing by Placees. This Appendix gives details of the terms and conditions of, and the mechanics of participation in, the Placing (the "Terms and Conditions"). No fees or commissions will be paid to Placees or by Placees in respect of any Placing Shares.

BofA Securities shall be entitled to effect the Placing by such alternative method to the Bookbuilding Process as it may, in its sole discretion, determine.

Participation in, and principal terms of, the Placing

   1)    BofA Securities is acting as sole bookrunner and as agent of the Company. 

2) Participation in the Placing will only be available to persons who may lawfully be, and are, invited to participate by BofA Securities. BofA Securities and its Affiliates (as defined in Rule 501(b) of Regulation D promulgated under the Securities Act or Rule 405 under the Securities Act, as applicable) are each entitled to enter bids in the Bookbuilding Process as principal.

3) The Bookbuilding Process, if successful, will establish a single price payable to BofA Securities in respect of the Placing Shares by all Placees whose bids are successful (the "Placing Price"). The Placing Price and the number of Placing Shares to be issued will be agreed between BofA Securities and the Company following completion of the Bookbuilding Process. Any discount to the market price of the Ordinary Shares will be determined in accordance with the FCA Listing Rules published pursuant to Part IV of the Financial Services and Markets Act 2000 ("FSMA") and applicable guidelines. The Placing Price and the number of Placing Shares to be issued will be announced on a Regulatory Information Service following the completion of the Bookbuilding Process.

4) To bid in the Bookbuilding Process, prospective Placees should communicate their bid by telephone to their usual sales or equity capital markets contact at BofA Securities. Each bid should state the number of Placing Shares which the prospective Placee wishes to subscribe for at the Placing Price, which will be ultimately established by the Company and BofA Securities, or at prices up to a price limit specified in its bid. Bids may be scaled down by BofA Securities on the basis referred to in paragraph 9 below. BofA Securities reserves the right not to accept bids or to accept bids in part rather than in whole. The acceptance of the bids shall be at BofA Securities's absolute discretion.

5) The Bookbuilding Process is expected to close no later than 4.30 p.m. (London time) on 1 April 2020 but may be closed earlier or later at the sole discretion of BofA Securities. BofA Securities may, in its sole discretion, accept bids that are received after the Bookbuilding Process has closed.

6) Each prospective Placee's allocation will be agreed between BofA Securities and the Company and will be confirmed to Placees orally by BofA Securities as agent of the Company following the close of the Bookbuilding Process. That oral confirmation will constitute an irrevocable legally binding commitment upon such person (who will at that point become a Placee) in favour of the Company and BofA Securities, under which such Placee 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 Appendix and in accordance with the Company's articles of association.

7) Each prospective Placee's allocation and commitment will be evidenced by a contract note issued to such Placee by BofA Securities, although if no such note is issued such commitment will remain irrevocable and legally binding. These Terms and Conditions will be deemed incorporated in that contract note.

8) Each Placee will also have an immediate, separate, irrevocable and binding obligation, owed to BofA Securities (as an agent of the Company), to pay to BofA Securities (or as it may direct) in cleared funds at the time set out in paragraph 12, an amount equal to the product of the Placing Price and the number of Placing Shares such Placee has agreed to subscribe for and the Company has agreed to allot and issue to that Placee. Each Placee's obligation will be owed to the Company and to BofA Securities. The Company shall allot such Placing Shares to each Placee following each Placee's payment to BofA Securities of such amount.

9) Subject to paragraphs 4 and 5 above, BofA Securities may choose to accept bids, either in whole or in part, on the basis of allocations determined in agreement with the Company and may scale down any bids for this purpose on such basis as it may determine. BofA Securities may also, notwithstanding paragraphs 4 and 5 above, subject to the prior consent of the Company: (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 Bookbuilding Process has closed to any person submitting a bid after that time. The acceptance of offers shall be at the absolute discretion of BofA Securities.

10) A bid in the Bookbuilding Process will be made on the terms and subject to the conditions in this Appendix and will be legally binding on the Placee on behalf of which it is made and, except with the consent of BofA Securities, will not be capable of variation or revocation after the time at which it is submitted.

11) Except as required by law or regulation, no press release or other announcement will be made by BofA Securities 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.

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

13) All obligations under the Bookbuilding Process and Placing will be subject to fulfilment or (where applicable) waiver of the conditions referred to below under "Conditions of the Placing" and to the Placing not being terminated on the basis referred to below under "Termination of the Placing Agreement".

14) By participating in the Bookbuilding Process, each Placee agrees that its rights and obligations in respect of the Placing will terminate only in the circumstances described below and will not be capable of rescission or termination by the Placee after confirmation (oral or otherwise) by BofA Securities.

15) To the fullest extent permissible by law, neither the Company, BofA Securities, nor any of their respective Affiliates, nor any of their or their Affiliates' respective directors, officers, employees and agents nor any other person acting on their behalf shall have any responsibility or liability to any Placee (whether in contract, tort or otherwise) (or to any other person whether acting on behalf of a Placee or otherwise). In particular, neither the Company, BofA Securities nor any of their respective Afffiliates, nor any of their or their Affiliates' respective directors, officers, employees and agents nor any other person acting on their behalf shall have any responsibility or liability (whether in contract, tort or otherwise and including to the fullest extent permissible by law, any fiduciary duties) in respect of BofA Securities's conduct of the Bookbuilding Process or of such alternative method of effecting the Placing as BofA Securities or its Affiliates may determine and the Company may agree.

Conditions of the Placing

The Placing is conditional upon the Placing Agreement becoming unconditional and not having been terminated in accordance with its terms. The obligations of BofA Securities under the Placing Agreement are conditional on customary terms and conditions, including amongst other things:

1) agreement being reached between the Company and BofA Securities on the Placing Price and the number of Placing Shares, and the publication by the Company of a pricing announcement;

2) the representations and warranties of the Company contained in the Placing Agreement being true and accurate on the date of the Placing Agreement, on the execution of the terms of the Placing and on the date of Admission;

3) the Company complying with all of the undertakings and having satisfied or performed all of the conditions and obligations on its part under the Placing Agreement which fall to be performed or satisfied prior to Admission and BofA Securities receiving a certificate from the Company confirming such is the case;

4) the Company allotting, subject only to Admission, the Placing Shares in accordance with the Placing Agreement; and

5) Admission taking place by 8.00 a.m. (London time) on the Closing Date (or such later date as the Company and BofA Securities may otherwise agree).

If: (i) any of the conditions contained in the Placing Agreement in relation to the Placing Shares, including those described above, are not fulfilled or (where applicable) waived by BofA Securities, by the respective time or date where specified (or such later time and/or date as the Company and BofA Securities may agree); or (ii) the Placing Agreement is terminated in the circumstances specified below under "Termination of the Placing Agreement", the Placing will not proceed and each 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.

BofA Securities may, at its discretion and upon such terms as it thinks fit, extend the time for the satisfaction of any condition or waive 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 conditions (1), (4) and (5) above may not be waived. Any such extension or waiver will not affect Placees' commitments as set out in this Announcement.

None of BofA Securities, the Company nor any of their Affiliates nor any of their respective directors, officers, employees and agents or any other person shall have any responsibility or liability to any Placee (whether in contract, tort or otherwise) (or to any other person whether acting on behalf of a Placee or otherwise) in respect of any decision it may make as to whether or not to waive or to extend the time and / or the 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 BofA Securities.

By participating in the Bookbuilding Process, each Placee agrees that its rights and obligations hereunder terminate only in the circumstances described above and under "Termination of the Placing Agreement" below, and will not be capable of rescission or termination by the Placee.

Termination of the Placing Agreement

BofA Securities is entitled, at any time before Admission, to terminate the Placing Agreement in accordance with the terms of the Placing Agreement in certain circumstances, including (among others) upon a breach of the representation, warranties and undertakings of the Company contained in the Placing Agreement, upon the occurrence of certain material adverse changes, or any development reasonably likely to involve a material adverse change, in the condition (financial, operational, legal or otherwise) or in the earnings, business affairs, solvency or prospects of the Company, together with its subsidiary undertakings (the "Group"), whether or not arising in the ordinary course of business or upon any material adverse change in the relevant financial markets or in the event of certain force majeure events.

Upon such termination, the parties to the Placing Agreement shall be released and discharged (except for any liability arising before or in relation to such termination) from their respective obligations under or pursuant to the Placing Agreement subject to certain exceptions.

By participating in the Placing, Placees agree that the exercise by BofA Securities of any right of termination or other discretion under the Placing Agreement shall be within the absolute discretion of BofA Securities and that it need not make any reference to Placees in this regard and that, to the fullest extent permitted by law, BofA Securities shall have no responsibility or liability to Placees whatsoever in connection with any such exercise or failure so to exercise.

Lock-up

The Company has undertaken to BofA Securities that, between the date of the Placing Agreement and the date which is 180 days after the Closing Date, other than in respect of, amongst other things, grants or exercises of options or share issues pursuant to terms of existing employee share schemes, neither the Company nor any person controlled by the Company, nor any person acting on the Company's behalf, will (without the prior written consent of BofA Securities), directly or indirectly, offer, pledge, sell, contract to sell, sell any option or contract to purchase, purchase any option or contract to sell, grant any option, right or warrant for the sale of, or otherwise transfer or dispose of any securities of the same class as the Placing Shares or any securities convertible into or exchangeable for securities of the same class as the Placing Shares or other instruments representing interests in securities of the same class as the Placing Shares or enter into any swap or other agreement or transaction that transfers, in whole or in part, directly or indirectly, the economic consequence of ownership of securities of the same class as the Placing Shares, whether any such swap or transaction is to be settled by delivery of shares or other securities, in cash or otherwise.

No prospectus

No offering document or prospectus has been or will be prepared in relation to the Placing or submitted to be approved by the FCA in relation to the Placing. Placees' commitments will be made solely on the basis of publicly available information taken together with the information contained in this Announcement (including this Appendix) released by the Company today, and any Exchange Information (as defined below) previously published by the Company and subject to the further terms set forth in the contract note to be provided to individual prospective Placees.

Each Placee, by accepting a participation in the Placing, agrees that the content of this Announcement (including this Appendix) and the publicly available information released by or on behalf of the Company 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 (other than publicly available information) or BofA Securities or its Affiliates (other than the amount of the relevant Placing participation in the oral confirmation given to Placees and the contract note referred to below) or any other person and none of BofA Securities, its Affiliates, any persons acting on their behalf 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 (regardless of whether or not such information, representation, warranty or statement was given or made by or on behalf of any such persons) . Each Placee acknowledges and agrees that it has relied on its own investigation of the business, financial or other position of the Company in accepting a participation in the Placing. Nothing in this paragraph shall exclude the liability of any person for fraudulent misrepresentation.

Registration and settlement

Settlement of transactions in the Placing Shares (ISIN GB00BVYVFW23) following Admission will take place within the system administered by Euroclear UK & Ireland Limited ("CREST"), using the delivery versus payment mechanism, subject to certain exceptions. The Company reserves the right to require settlement for and delivery of the Placing Shares (or a portion thereof) to Placees in certificated form if, in BofA Securities's opinion, delivery or settlement is not possible or practicable within the CREST system 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 Bookbuilding Process for the Placing, each Placee allocated Placing Shares in the Placing will be sent a contract note stating the number of Placing Shares to be allocated to it at the Placing Price, the aggregate amount owed by such Placee to BofA Securities and settlement instructions. Placees should settle against CREST ID: 686. It is expected that such contract note will be despatched on 1 April 2020 and that this will also be the trade date.

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 BofA Securities.

The Company will deliver the Placing Shares to a CREST account operated by BofA Securities as agent for the Company and BofA Securities will enter its delivery (DEL) instruction into the CREST system. BofA Securities will hold any Placing Shares delivered to this account as nominee for the Placees. The input to CREST by a Placee of a matching or acceptance instruction will then allow delivery of the relevant Placing Shares to that Placee against payment.

It is expected that settlement will be on 3 April 2020 on a T + 2 basis in accordance with the instructions given to BofA Securities.

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 BofA Securities.

Each Placee agrees that, if it does not comply with these obligations, BofA Securities 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 shall be required to bear any stamp duty, stamp duty reserve tax or other stamp, securities, transfer, registration, execution, documentary or other similar impost, duty or 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 contract note is copied and delivered immediately to the relevant person within that organisation. Insofar as Placing Shares are registered in a Placee's name or that of its nominee or in the name of any person for whom a Placee is contracting as agent or that of a nominee for such person, such Placing Shares should, subject to as provided below, be so registered free from any liability to UK stamp duty or stamp duty reserve tax. If there are any circumstances in which any other stamp duty or stamp duty reserve tax (together with interest and penalties) is payable in respect of the issue of the Placing Shares, neither BofA Securities nor the Company shall be responsible for the payment thereof.

Representations and warranties

By participating in the Placing each Placee (and any person acting on such Placee's behalf) irrevocably acknowledges, confirms, undertakes, represents, warrants and agrees (as the case may be) with BofA Securities (in its capacity as underwriter of the Placing Shares and sole bookrunner and as agent of the Company in respect of the Placing) and the Company, in each case as a fundamental term of their application for Placing Shares as set out below. Each Placee (and any person acting on such Placee's behalf):

1) confirms that it has the knowledge and experience in financial, business and international investment matters as is required to evaluate the merits and risks of purchasing the Placing Shares. It is experienced in investing in securities of this nature in the Company's sector and is aware that it may be required to bear, and is able to bear, the economic risk of, and is able to sustain a complete loss in connection with the Placing. It has relied on its own examination and due diligence of the Company, and the terms of the Placing, including the merits and risks involved;

2) acknowledges that the Ordinary Shares are listed on the Official List of the FCA, and that the Company is therefore required to publish certain business and financial information in accordance with the rules and practices of the FCA (collectively, the "Exchange Information"), which includes a description of the nature of the Company's business and the Company's most recent balance sheet and profit and loss account, and similar statements for preceding financial years, and that it has reviewed such Exchange Information and is able to obtain or access such Exchange Information without undue difficulty;

3) has: (a) made its own assessment and satisfied itself concerning legal, regulatory, tax, business and financial considerations in connection herewith to the extent it deems necessary; (b) received, read and understood this Announcement, including these Terms and Conditions, in its entirety; (c) had access to review the Exchange Information and such other publicly available information concerning the Group that it considers necessary or appropriate and sufficient in making an investment decision; (d) reviewed the Exchange Information and such other information as it believes is necessary or appropriate in connection with its subscription or purchase of the Placing Shares; and (e) has made its investment decision based solely upon its own judgement, due diligence and analysis and not upon any view expressed or information provided by or on behalf of BofA Securities;

4) understands and acknowledges that no offering document, listing particulars or prospectus has been or will be prepared in connection with the Placing;

5) 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 subscribe for the Placing Shares is contained in this Announcement and any Exchange Information, such information being all that it deems 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 investigations, representations, warranties or statements made by BofA Securities or the Company and neither BofA Securities nor the Company will be liable for any Placee's decision to accept an invitation to participate in the Placing based on any other information, representation, warranty or statement;

6) understands and agrees that it may not rely on any investigation that BofA Securities, its directors, officers, employees, agents or Affiliates or any other person acting on its behalf may or may not have conducted with respect to the Company, the Group or the Placing and BofA Securities has not made any representation to it, express or implied, with respect to the accuracy or adequacy of Exchange Information or any other publicly available information concerning the Company, the merits of the Placing, the subscription for or purchase of the Placing Shares, or as to the condition, financial or otherwise, of the Company, the Group, or as to any other matter relating thereto, and nothing herein shall be construed as a recommendation to it to subscribe for or purchase the Placing Shares. It acknowledges and understands that this Announcement and any other announcement or presentation provided to it (if any) have been prepared by the Company and no such announcement or presentation (if any) nor any other information has been prepared by BofA Securities for the purposes of the Placing or is in any way the responsibility of BofA Securities;

7) understands and agrees that once an allocation is confirmed to it orally by BofA Securities as agent of the Company following the close of the Bookbuilding Process, such oral confirmation will constitute an irrevocable legally binding commitment on it in favour of the Company and BofA Securities, under which it agrees to acquire the number of Placing Shares allocated to it at the Placing Price on the Terms and Conditions and in accordance with the Company's articles of association;

8) acknowledges and agrees that it will not hold BofA Securities, any of its associates, directors, officers, employees, agents or Affiliates nor or any person acting on its behalf responsible or liable for any misstatements in or omission from the Exchange Information or any other any publicly available information relating to the Group or information made available (whether in written or oral form) as part of pre-sounding discussions with investors (if relevant) relating to the Group (the "Information") and that neither BofA Securities nor any person acting on its behalf, makes any representation or warranty, express or implied, as to the truth, accuracy or completeness of such Information or accepts any responsibility for any of such Information, either at the date of this Announcement or at the Closing Date;

9) acknowledges that it has not relied on any information relating to the Company contained in any research reports prepared by BofA Securities, any of its Affiliates or any person acting on BofA Securities's or any of its Affiliates' behalf;

10) acknowledges that in connection with the Placing, BofA Securities and any of its Affiliates may take up a portion of the Placing Shares as a principal position and in that capacity may retain, purchase or sell for their own account such Placing Shares and any other securities of the Company or related investments and may offer or sell such securities or other investments in connection with the Placing or otherwise. Accordingly, references in this Announcement to shares being issued, offered or placed should be read as including any issue or offer to, or subscription, acquisition, placing or dealing by, BofA Securities and any Affiliate acting in such capacity. In addition BofA Securities and any of its Affiliates may enter into financing arrangements (including swaps, warrants or contracts for differences) with investors in connection with which BofA Securities and any of its Affiliates may from time to time acquire, hold or dispose of shares. Neither BofA Securities nor any Affiliate intends to disclose the extent of any such investment or transactions otherwise than in accordance with any legal or regulatory obligations to do so;

11) with respect to any Placing Shares offered to or purchased by it in the United States or for and on behalf of persons in the United States, it understands and agrees: (1) that it is a "qualified institutional buyer" ("QIB") within the meaning of Rule 144A under the U.S. Securities Act of 1933, as amended, (the "Securities Act"); (2) that the Placing Shares are being offered and sold to it in accordance with the exemption from registration under the Securities Act for transactions by an issuer not involving a public offering of securities in the United States and that the Placing Shares have not been, and will not be, registered under the Securities Act or with any State or other jurisdiction of the United States; (3) that the Placing Shares may not be reoffered, resold, pledged or otherwise transferred by it except (a) outside the United States in an offshore transaction pursuant to Rule 903 or Rule 904 of Regulation S under the Securities Act ("Regulation S"), (b) in the United States to a person whom the seller reasonably believes is a QIB to whom notice is given that the offer, sale or transfer is being made in reliance on Rule 144A, pursuant to Rule 144A under the Securities Act, (c) pursuant to Rule 144 under the Securities Act (if available), (d) to the Company, (e) pursuant to an effective registration statement under the Securities Act, or (f) pursuant to another available exemption, if any, from registration under the Securities Act, in each case in compliance with all applicable laws; (4) that the Placing Shares are "restricted securities" as defined in Rule 144(a)(3) under the Securities Act; (5) to notify any transferee to whom it subsequently reoffers, resells, pledges or otherwise transfers the Placing Shares of the foregoing restrictions on transfer; (6) for so long as the Placing Shares are "restricted securities" (within the meaning of Rule 144(a)(3) under the Securities Act), it will segregate such Placing Shares from any other shares that it holds that are not restricted securities, shall not deposit such shares in any depositary facility established or maintained by a depositary bank and will only transfer such Placing Shares in accordance with this paragraph; (7) if it is acquiring the Placing Shares as a fiduciary or agent for one or more investor accounts, each such account is a QIB, it has sole investment discretion with respect to each such account and it has full power and authority to make the acknowledgements, representations, warranties and agreements herein on behalf of each such account; (8) it is acquiring such Placing Shares for its own account (or the account of a QIB as to which it has sole investment discretion) for investment purposes and (subject to the disposition of its property being at

all times within its control) not with a view to any distribution of the Placing Shares; and (9) that no representation has been made as to the availability of the exemption provided by Rule 144 or any other exemption under the Securities Act for the reoffer, resale, pledge or transfer of the Placing Shares;

12) if it is a person in a member state of the European Economic Area or the United Kingdom (each, a "Relevant State") it is a "qualified investor" (a "Qualified Investor") within the meaning of Article 2(e) of Regulation (EU) 2017/1129 (as supplemented by Commission delegated Regulation (EU) 2019/980 and Commission delegated Regulation (EU) 2019/979) (the "Prospectus Regulation") and, to the extent applicable, any funds on behalf of which it is subscribing for and acquiring the Placing Shares and that are located in a Relevant State are each themselves such a Qualified Investor;

13) if in the United Kingdom, that it is a Qualified Investor: (i) who falls within the definition of "investment professional" in Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 (the "Order") or (ii) who falls 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 lawfully be communicated and it undertakes that it will acquire, hold, manage and (if applicable) dispose of any Placing Shares that are allocated to it for the purposes of its business only;

14) understands that no action has been or will be taken by the Company, BofA Securities nor any of their respective directors, officers, employees, agents or Affiliates nor or any other person acting on behalf of any of the Company or BofA Securities that would, or is intended to, permit a public offer of the Placing Shares in any country or jurisdiction where any such action for that purpose is required;

15) represents and warrants that (i) it and any person acting on its behalf has capacity and authority and is otherwise entitled to purchase the Placing Shares under the laws of all relevant jurisdictions which apply to it; (ii) it has paid any issue, transfer or other taxes due in connection with its participation in any territory; (iii) it has not taken any action which will or may result in the Company, BofA Securities, any of their Affiliates or any person acting on their behalf being in breach of the legal and/or regulatory requirements of any territory in connection with the Placing and (iv) its purchase of the Placing Shares will be in compliance with applicable laws and regulations in the jurisdiction of its residence, the residence of the Company, or otherwise;

16) if it is in South Africa, either (i) it is a category of person contemplated in section 96(1)(a) of the Companies Act, 2008 of South Africa (the "SA Companies Act") to whom an offer of Placing Shares may be made without such offer being classified as an "offer to the public" (as defined in the SA Companies Act); or (ii) if (i) does not apply, it is acting as a principal and the total acquisition cost to it of the Placing Shares which it will acquire pursuant to the Placing will be equal to or greater than ZAR 1,000,000;

17) If it is resident in Australia, it is a professional investor, as defined in section 9 and for the purposes of section 708(11) of the Corporations Act 2001 (Cth) of Australia or the minimum amount to be paid by it for the Placing Shares being subscribed for will not be less than AUD500,000;

18) If it is resident in Canada, it is an institutional accredited investor located or resident in the Province of Alberta, the Province of British Columbia, the Province of Ontario or the Province of Québec and not in any other province or territory of Canada, and is entitled under provincial securities laws to purchase the Shares without the benefit of a prospectus qualified under those securities laws;

19) 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 against delivery of such Placing Shares to it, failing which the relevant Placing Shares may be placed with other Placees or sold as BofA Securities may in its absolute discretion determine and it will remain liable for any shortfall below the net proceeds of such sale and the placing proceeds of such Placing Shares and may be required to bear any stamp duty or stamp duty reserve tax (together with any interest or penalties due pursuant to the terms set out or referred to in this document) which may arise upon the sale of such Placee's Placing Shares on its behalf;

20) will subscribe for any Placing Shares for its account or for one or more accounts as to each of which it exercises sole investment discretion and it has full power to make the foregoing acknowledgements, representations and agreements on behalf of each such account;

21) understands and acknowledges that the Company, BofA Securities, their respective directors, officers, employees, agents or Affiliates and others will rely upon the truth and accuracy of the representations, warranties and acknowledgements set forth herein and in this Announcement;

22) acknowledges and agrees that the exercise by BofA Securities of any power to grant consent to the Company to undertake a transaction which would otherwise be subject to the lock-up under the Placing Agreement shall be within the absolute discretion of BofA Securities and that it need not make any reference to, or consult with, us and that it shall have no liability to it in connection with any such exercise of the power to grant such consent;

23) acknowledges and agrees that the exercise or non-exercise by BofA Securities of any right of termination under the placing agreement shall be at the absolute discretion of BofA Securities, with no requirement to reference or consult with it and BofA Securities shall have no liability to us in connection with the good faith exercise or non-exercise of such termination right;

24) acknowledges that its commitment to subscribe for Placing Shares on the terms set out herein and in the contract note will continue notwithstanding any amendment that may in future be made to the terms of the Placing and that Placees will have no right to be consulted or require that their consent be obtained with respect to the Company's conduct of the Placing; and

25) acknowledges that any agreements entered into by it pursuant to these Terms and Conditions, and all non-contractual or other obligations arising out of or in connection with them, shall be governed by and construed in accordance with the laws of England 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 BofA Securities 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.

The foregoing acknowledgements, agreements, undertakings, representations, warranties and confirmations are given for the benefit of each of the Company and BofA Securities (for their own benefit and, where relevant, the benefit of their respective Affiliates and any person acting on their behalf) and are irrevocable. The agreement to settle a Placee's subscription for of Placing Shares (and/or the subscription by a person for whom such Placee is contracting as agent) free of stamp duty and stamp duty reserve tax is conditional on the settlement relating only to a subscription by such Placee and/or such person direct from the Company for the Placing Shares in question. Such agreement is also conditional on the Placing Shares not being subscribed for in connection with arrangements to issue depositary receipts or to issue or transfer the Placing Shares into a clearance service. 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 or other similar taxes (including any interest, fines or penalties) may be payable, for which neither the Company nor BofA Securities will be liable and the Placees shall indemnify the Company and BofA Securities on an after-tax basis for any such taxes paid by the Company or BofA Securities in respect of any such arrangements or dealings. If there are any such arrangements or dealings, each Placee should seek its own advice and notify BofA Securities accordingly.

In addition, Placees should note that they will be liable for any stamp duty, stamp duty reserve tax and all other stamp, issue, securities, transfer, registration, documentary or other duties or taxes (including any interest, fines or penalties) payable outside the UK by them or any other person on the acquisition of any Placing Shares or the agreement to acquire any Placing Shares.

Each Placee, and any person acting on behalf of the Placee, acknowledges that BofA Securities does not owe any fiduciary or other duties to any Placee in respect of any representations, warranties, undertakings or indemnities in the Placing Agreement.

Each Placee and any person acting on behalf of the Placee acknowledges and agrees that neither BofA Securities nor any of its Affiliates may, at its absolute discretion, agree to become a Placee in respect of some or all of the Placing Shares.

Each Placee and any person acting on behalf of the Placee acknowledges and agrees that it has neither received nor relied on any inside information concerning the Company in accepting this invitation to participate in the Placing. Each Placee undertakes that the person whom it specifies for registration as holder of the Placing Shares will be (i) itself or (ii) its nominee, as the case may be. Neither BofA Securities nor the Company will be responsible for any liability to stamp duty or stamp duty reserve tax or other similar taxes resulting from a failure to observe this requirement.

Each Placee agrees to indemnify on an after-tax basis and hold the Company, BofA Securities and their respective directors, officers, employees, agents and 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 Appendix and further agrees that the provisions of this Appendix shall survive after completion of the Placing.

The rights and remedies of BofA Securities and the Company under these Terms and Conditions are in addition to any rights and remedies which would otherwise be available to each of them and the exercise or partial exercise of one will not prevent the exercise of others.

When a Placee or person acting on behalf of the Placee is dealing with BofA Securities, any money held in an account with BofA Securities 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 FCA 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 BofA Securities's money in accordance with the client money rules and will be used by BofA Securities in the course of its own business and the Placee will rank only as a general creditor of BofA Securities.

All times and dates in this Announcement may be subject to amendment.

Information to Distributors

Solely for the purposes of the product governance requirements contained within: (a) EU Directive 2014/65/EU on markets in financial instruments, as amended, ("MiFID II"); (b) Articles 9 and 10 of Commission Delegated Directive (EU) 2017/593 supplementing MiFID II; and (c) local implementing measures (together, the "MiFID II Product Governance Requirements"), and disclaiming all and any liability, whether arising in tort, contract or otherwise, which any "manufacturer" (for the purposes of the MiFID II Product Governance Requirements) may otherwise have with respect thereto, the Placing Shares have been subject to a product approval process, which has determined that such Placing Shares are: (i) compatible with an end target market of retail investors and investors who meet the criteria of professional clients and eligible counterparties, each as defined in MiFID II; and (ii) eligible for distribution through all distribution channels as are permitted by MiFID II (the "Target Market Assessment"). Notwithstanding the Target Market Assessment, Distributors should note that: the price of the Placing Shares may decline and investors could lose all or part of their investment; the Placing Shares offer no guaranteed income and no capital protection; and an investment in the Placing Shares is compatible only with investors who do not need a guaranteed income or capital protection, who (either alone or in conjunction with an appropriate financial or other adviser) are capable of evaluating the merits and risks of such an investment and who have sufficient resources to be able to bear any losses that may result therefrom. The Target Market Assessment is without prejudice to the requirements of any contractual, legal or regulatory selling restrictions in relation to the Placing. Furthermore, it is noted that, notwithstanding the Target Market Assessment, BofA Securities will only procure investors who meet the criteria of professional clients and eligible counterparties.

For the avoidance of doubt, the Target Market Assessment does not constitute: (a) an assessment of suitability or appropriateness for the purposes of MiFID II; or (b) a recommendation to any investor or group of investors to invest in, or purchase, or take any other action whatsoever with respect to the Placing Shares.

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

This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact [e-mail] or visit www.rns.com.

END

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(END) Dow Jones Newswires

April 01, 2020 02:01 ET (06:01 GMT)