Prospectus re: Proposed Acquisition of Nuformix

RNS Number : 9195Q

Levrett PLC

15 September 2017

 

Levrett plc

("Levrett" or "the Company")

Proposed Acquisition of Nuformix Limited

Placing of New Ordinary Shares

Approval of a Waiver of obligation under Rule 9 of the City Code on Takeovers and Mergers

Notice of General Meeting

Publishing and Posting of the Prospectus

Levrett plc, a Company formed to acquire a target company in the pharmaceutical and biotechnology sector, is pleased to announce that it has entered into a conditional agreement to acquire the entire issued share capital of Nuformix Limited ("Nuformix") for a total consideration of £12,000,000 to be settled through the issuance of new ordinary shares in the Company at a price of 4 pence per share (the "Acquisition"), subject to Shareholders' approval and Re-admission (as defined below). In addition, the Company is today announcing the Placing, under which it has issued 57,500,000 Placing Shares at 4p per share, raising £2.3 million, conditional, inter alia, upon Re-Admission.

Nuformix Summary

Nuformix is a UK incorporated pharmaceutical development company using cocrystal technology to unlock the therapeutic potential of approved small molecule drugs.  It has discovered, developed and patented novel cocrystal forms of approved small molecules, creating an IP portfolio containing 14 granted patents covering cocrystal forms of five small molecule drugs. It has identified two drug cocrystals that the Directors and Directors on Admission believe represent stand-out commercial and therapeutic promise and is seeking to progress these programmes to human pharmacokinetic (PK) studies, funded by the Placing:

NXP001:

·      NXP001 is based on a currently marketed treatment in the field of oncology supportive care, which addresses some of the severe side effects faced by cancer patients in their treatment.

·      It provides entry into the large and growing oncology supportive care market, currently estimated at £17.5 billion per annum, rising to £23.5 billion in 2021.

NXP002:

·      NKP0002 is based on a known drug for the treatment of allergies. In this case, Nuformix seeks to reprofile the drug to treat a range of fibrotic conditions, which can occur in organs such as the lungs, liver or heart.

·      NXP002 provides a route into the large, emerging fibrosis market, currently estimated at over $1 billion in the US for lung fibrosis alone, with a safe and innovative treatment.

·      The Directors and Directors on Admission believe that there is high unmet need in an exponentially growing and critically ill patient population and strong potential for early out-licensing given the potential to treat a breadth of fibrotic conditions.

Nuformix Strategy

The Directors and Directors on Admission believe that approved drugs offer the potential to generate significant value in new therapeutic uses, as proven safety reduces development risk/cost and increases speed to clinic/market versus traditional biotech models. Nuformix's strategy seeks to harnesses these strategic advantages:

·      Identify known drug molecules with the potential to function as innovative therapies for unmet medical needs

·      Use cocrystal technology to protect and enable such molecules towards new commercially attractive product opportunities

·      Lower-risk human studies will provide validation to support out-licensing and further development by pharmaceutical partners

·      A balanced pipeline combines assets for early out-licensing with those offering significant mid-term partnering potential

·      Early licensing revenues allow Nuformix to self-fund future discovery and development and build greater value into our pipeline

Development Pipeline

The Enlarged Group intends to use cocrystal technology as applied to pharmaceutical development both for:

·      Innovative Generics: Deliver a material benefit to an existing drug in its existing use, such that therapeutic and commercial advantages are created (e.g. reduction of side effects)

·      Drug Reprofiling: Creating novel uses for existing drug molecules in areas of unmet need that would not be possible for the pure drug form.

The Directors and Directors on Admission believe that this approach will allow re-use of existing safety data, reducing the time and cost of achieving clinical proof-of-concept and increasing success rates versus traditional biotech models.

Nuformix has completed research partnerships with Vectura Limited ("Vectura") (LSE:VEC) and Magnus Oxygen Limited ("Magnus"). Patents have been filed as a result of collaborative research in each partnership.

Commenting on the proposed acquisition, John Lidgey, Independent Director of Levrett, said: "I am delighted to announce the proposed acquisition of Nuformix which has developed leading edge technology and IP in pharmaceutical co-crystallisation. The Directors of Levrett believe that Nuformix operates in a very exciting field within the global pharmaceutical arena, with an outstanding management team and great potential.  I believe that this acquisition is line with Levrett's stated acquisition strategy and that it represents a very strong proposition for our shareholders."

Dan Gooding, Chief Executive of Nuformix, said: "The Nuformix team is delighted to reach agreement on the Acquisition.  We are proud of our intellectual property portfolio and believe that our two lead cocrystal programmes offer great commercial and therapeutic promise.  We see considerable benefits in becoming a listed company and the funds raised through this placing will facilitate the clinical development of NXP001 and NXP002.  Cocrystal technology allows us to uniquely and robustly protect, enable and differentiate the resulting products. We'll continue to add to our IP portfolio and pre-clinical validation also funded by the placing will support future entries to the Nuformix pipeline."

For further information please contact:

Levrett plc John Lidgey - Chairman	[phone]
Whitman Howard Limited Financial Advisor to Levrett Nick Lovering	[phone]
Gable Communications Ltd Financial Public Relations John Bick Justine James	[phone] [e-mail]
Nuformix Limited Dan Gooding - Chief Executive Officer	[phone]

Background

Levrett was admitted to trading on the standard listing segment of the Main Market of the London Stock Exchange on the 17 December 2015 with the intention to acquire one or more existing businesses, ideally with significant intellectual property in the pharmaceutical and biotechnology sectors. The Directors have focused on categories of serious illness that they believed would benefit from technological advances in diagnosis and treatment such as cancer, cardio vascular disease and respiratory diseases.

Information on Nuformix - www.nuformix.com

Since its inception, Nuformix has focussed on utilising cocrystal technology to discover, develop and patent cocrystal forms of existing small molecule drugs. Nuformix has created a patent portfolio that currently contains granted patents covering all cocrystal forms of five small molecule drugs.

Nuformix has conducted various pre-clinical studies that the Directors and Directors on Admission believe demonstrate how its patent-protected cocrystal drug forms offer therapeutic and commercial advantages when compared to the currently marketed drug form.

Nuformix has identified two drug cocrystals from its portfolio that represent stand-out commercial and therapeutic promise and is seeking to progress these programmes to human pharmacokinetic (PK) studies, to be funded by the Placing.

Reasons for the Acquisition and the Enlarged Group's Strategy

Levrett has been focused on four specific strategic sectors, being; Oncology, Diabetes, Obesity and Mental Health to identify businesses, assets and/or projects that are available at attractive valuations and hold opportunities to unlock embedded value. The Directors identified a number of potential acquisition targets and have drawn on the expertise of a number of key scientific advisors to review these targets. Following technical, financial and legal due diligence, the Directors believe that Nuformix represents the most suitable acquisition target for the Company at this time.

In view of the size and nature of the acquisition of Nuformix, the Acquisition will constitute a Reverse Takeover under the Listing Rules, because the vendors of the business acquired will hold a substantial part of the enlarged equity and its management will comprise a majority of the Nuformix Directors.

The Enlarged Group - Strategy

The Enlarged Group's strategy centres on three specific activities:

NXP001

Firstly, the Enlarged Group will conduct a human PK study for its first lead product, NXP001, in which it will demonstrate the utility of its patented cocrystal drug form to achieve bioequivalence to a currently marketed treatment in oncology supportive care.

Despite expiration of intellectual property protecting the drug molecule, the creation of a bioequivalent product is currently highly technically challenging. Formulation intellectual property, which remains valid until 2027, robustly protects certain approaches.

Following Re-Admission of the Enlarged Group, the Company, intends to demonstrate NXP001's potential for bioequivalence in humans within months of Re-Admission. Following this process the Enlarged Group will seek to out-license NXP001 to a global pharmaceutical company, with current products and infrastructure in the oncology supportive care sector.

The Directors and Directors on Admission believe that the future licensee will conduct all further requirements in order to achieve market approval for NXP001.

NXP002

Within 18 months of Re-Admission, the Enlarged Group also intends to conduct a human PK study for its second lead product, NXP002, in which it will aim to demonstrate the utility of its patented cocrystal drug form to achieve effective and consistent oral delivery of NXP002, which is not currently possible.

In addition, the Company aims to conduct further pre-clinical studies in parallel to further support future use of NXP002 in fibrosis, which has already been validated by completed Nuformix pre-clinical work. The results of the parallel pre-clinical programme will assist in developing the strategy for follow-on clinical development of NXP002 and support Nuformix as it seeks to out-license the asset at this stage.

The Directors and Directors on Admission believe that there is considerable commercial appetite for out-licensing early-stage assets with potential in fibrosis, as demonstrated by recently completed out-licensing transactions in the pharmaceutical and biotech sector. However, the Directors and Directors on Admission believe that anti-fibrotic treatments that have demonstrated clinical efficacy in humans can command far greater values in out-licensing transactions. Therefore, depending on the outcome of the clinical and pre-clinical programmes for NXP002, the Enlarged Group may seek to complete a human Phase IIa trial (human proof-of-concept study) at a later stage in a fibrotic condition in order to build far greater value into the NXP002 asset and create the possibility to complete a significant out-licensing transaction.

The Directors and Directors on Admission believe that such follow-on clinical development could be self-funded by reinvesting income expected to be obtained from the out-licensing of NXP001. For avoidance of doubt, the Net Proceeds will not fund any activities towards a Phase II a trial for NXP002. Such activities would not commence during the first 18 month period.

Discovery Pipeline

Finally, the Enlarged Group will conduct further discovery and development activities, securing intellectual property for new cocrystal assets. A selection of assets including NXP003, which is at a much earlier stage of development than either NXP0001 or NXP0002, will in the Directors' and Directors on Admission's opinion, potentially target a mechanism understood to confer resistance to immune oncology, chemotherapy and radiotherapy cancer treatments, will be further validated in a series of pre-clinical studies to demonstrate their therapeutic and commercial potential.

The Enlarged Group will have the option to self-fund the further development of new assets by reinvesting income from the out-licensing of NXP001 (and potentially NXP002) prior to completing further out-licensing transactions for new assets developed as a result of these activities.

The Directors and Directors on Admission believe that Nuformix may generate significant revenues from licensing fees, which may be received in the form of immediate upfront payment, future development milestones and eventual sales royalties.

Clinical validation of its NXP001 and NXP002 assets, in addition to securing and validating further cocrystal assets may also place the Company in a robust position to complete a trade sale with a larger pharmaceutical company.

Directors and Senior Management

Upon completion of the Acquisition, the Existing Directors (save for John Lidgey) will resign from the Board and the four Proposed Directors will be appointed to the Board. Accordingly, the Board of Directors on Admission will be:

David Joszef Tapolczay - Non-Executive Chairman

Daniel Gooding - Chief Executive Officer

Joanne Holland - Chief Scientific Officer

Kirk Siderman-Wolter - Finance Director

John Lidgey - Non-Executive Director

About Cocrystallisation

Pharmaceutical cocrystallisation is a scientific process that allows the physical properties of a drug

substance to be uniquely amended, with a view to achieving one or more of the following:

§ Solving problems that relate to poor drug physical properties, which currently prevent or limit

optimal use;

§ Using enhanced/optimised physical properties to create advantageous drug products (e.g

reducing side effects, creating new, or improving existing delivery options, creating physical

property options that allow a drug to be used in a new disease); or

§ Creating new IP to protect drug cocrystals for future development, or to circumvent any

'blocking' IP.

When successful, cocrystallisation of a drug molecule and manipulation of its physical properties can

lead to one or more of the following:

§ increased effectiveness of the cocrystallised drug;

§ the establishment of new methods of delivery for the drug molecule; or

§ opportunities to use the drug cocrystal to treat unmet needs in new diseases that were not previously possible.

The development of drugs through cocrystallisation has significant benefits compared to more

traditional methods of drug development. Specifically, Nuformix's approach uses only existing drug

molecules, which have a history of safe use. This proven history reduces development risks, costs and time and has an abbreviated regulatory pathway to obtain faster market approval.

The process of cocrystallisation involves combining two or more small molecule substances, such that

the molecules in each substance crystallise together at a molecular level, as opposed to existing in their pure form. In Nuformix's application of cocrystallisation, with a view to creating innovative pharmaceutical products, a drug molecule is cocrystallised with a second inert molecule (e.g. a known pharmaceutical excipient), termed as a coformer.

The resulting new substance contains very precise ratios of drug and coformer molecules. The drug molecule itself has not been chemically modified and therefore can still be treated from a regulatory perspective as if it were the original pure drug.

Simply, the crystal form in which it exists has been re engineered such that it now includes a second inert molecule with a history of pharmaceutical use:

§ The first advantage is that this change gives the resulting new two component substance novel and unique physical properties, which can be leveraged to create new and advantageous pharmaceutical products.

§ The second advantage is that for those molecules that will form cocrystals, new intellectual property is created, protecting the resulting novel cocrystal forms. Therefore, where successful, cocrystallisation provides new opportunities to develop innovative treatments using existing drugs that would otherwise not be possible.

The acquisition of Nuformix, which is in line with the Company's investment strategy, if completed, will constitute a Reverse Takeover under the Listing Rules because of the size of Nuformix in relation to that of the Company and the fact that it will give rise to a fundamental change to the business, board composition and voting control of the Company resulting in the Company becoming an operating company.

Accordingly, the Company has today published a prospectus (the "Document" or the "Prospectus") in relation to, inter alia, the Acquisition and Re-Admission to listing of its Enlarged Share Capital to the standard listing segment of the Official List and to trading on the London Stock Exchange's Main Market ("Re-Admission").

As indicated in the Prospectus, the Company is seeking Shareholders' approval for the Reverse Takeover despite this not being a specific requirement of the Listing Rules. Shareholder approval is also required under the Takeover Code to approve the Code Waiver. Following the implementation of the Proposals, certain Shareholders of the Enlarged Group who are deemed to be acting in concert, the Concert Party, will in aggregate hold 300,000,000 Ordinary Shares representing 65.11 per cent. of the Enlarged Share Capital. The Concert Party comprises the Nuformix shareholders, being Alan Chorlton, Christopher Frampton, CPI Innovation Services Limited, Spreadex Ltd, Daniel Gooding, David Tapolczay, Joanne Holland and Stephen Cash.

Without the waiver of the obligation under Rule 9 of the City Code, issue of the Consideration Shares would require the members of the Concert Party to make a general offer for the entire issued and to be issued share capital of the Company not already held by them. The Panel has agreed with the Company to grant such a waiver, subject to the passing at the General Meeting by Independent Shareholders (being Shareholders other than the members of the Concert Party) of the Whitewash Resolution, to be taken on poll.

Accordingly, a General Meeting of the Company, to be held at 12.00 p.m. on 13 October 2017 at the offices of Shakespeare Martineau LLP at 60 Gracechurch Street, London, EC3V 0HR, is being convened at which resolutions will be proposed, inter alia, to approve the Acquisition, the issue and allotment of the Consideration Shares, the Placing Shares, the Success Fee Shares, Convertible Loan Note Shares and the Whitman Howard Fee Shares, issue of the Options, Whitman Howard Warrants, Shakespeare Martineau Warrants, Convertible Loan Note Warrants and Existing Director Warrants and the Code Waiver.  The Resolutions are set out in full in the notice of the General Meeting summarised below in Appendix 2.

The Prospectus has been approved by the UK Listing Authority and is available for inspection at the Financial Conduct Authority's National Storage Mechanism which can be accessed from www.morningstar.co.uk/uk/NSM. The Prospectus is also available on the Company's website http://www.levrett.com/investors and hard copies are available free of charge from the registered office of the Company, Suite 31, Second Floor, 107 Cheapside, London EC2V 6DN.

Should the Proposal be approved at the Company's General Meeting and the Acquisition and Placing completed, it is expected that the existing listing on the standard listing segment of the Official List and trading in the Existing Ordinary Shares on the London Stock Exchange's Main Market, will be cancelled at 8.00 a.m. on 16 October 2017 and the Re-Admission is expected to become effective and dealings in the Ordinary Shares to commence on the London Stock Exchange at 8.00 a.m. on 16 October 2017. Further details of the Acquisition and Placing, as well as the Notice of General Meeting to approve the Waiver are contained in the Appendices to this announcement. Capitalised terms in this announcement are as defined in the Prospectus unless the context otherwise requires.

List of Appendices:

1.   The Code Waiver and the Placing

2.   Notice of General Meeting

3.   Important Information

4.   Forward-looking Information

5.   Expected Timetable, Statistics, Dealing Codes

Appendix 1

Further details of the Code Waiver and Placing

Rule 9 of the Takeover Code

The Acquisition, and in particular the issue by the Company of the Consideration Shares to the Sellers, gives rise to certain considerations under the City Code. Brief details of the Panel, the Takeover Code and the protections they afford are set out below.

The Takeover Code is issued and administered by the Panel. The Takeover Code applies to all takeover and merger transactions, however effected, where the Company is, inter alia, a listed or unlisted public company resident in the United Kingdom, Channel Islands or Isle of Man. The Company is such a company and its Shareholders are entitled to the protections afforded by the Takeover Code and its provisions.

Under Rule 9 of the City Code, a person who acquires, whether by a series of transactions over a period of time or not, an interest in shares which (taken together with securities in which he is already interested and which persons acting in concert with him are interested) carry 30 per cent. or more of the voting rights of a company which is subject to the Takeover Code, the person is normally required by the Panel to make a general offer to all the remaining shareholders of that company to acquire their shares. Similarly, when any person individually or a group of persons acting in concert, is interested in securities which in aggregate carry not less than 30 per cent. of the voting rights of such a company but does not hold shares carrying more than 50 per cent. of such voting rights, that person may not normally acquire further securities without making a general offer to the shareholders of that company to acquire their shares. An offer under Rule 9 must be in cash and at the highest price paid by the person required to make an offer, or any person acting in concert with him, for any interest in shares of the company during the 12 months prior to the announcement of the offer.

Under the Takeover Code, a "concert party" arises, inter alia, when persons who, pursuant to an agreement or understanding (whether formal or informal), co-operate, to obtain or consolidate control of that company. Under the Takeover Code, control means an interest, or interests, in shares carrying in aggregate 30 per cent. or more of the voting rights of a company, irrespective of whether such interest or interests give de facto control. In this context, voting rights means all the voting rights attributable to the capital of the company which are currently exercisable at a general meeting. The Takeover Code also states that shareholders in a private company who sell their shares in that company in consideration for the issue of new shares in a company to which the Code applies, will be presumed to be acting in concert with the company of which they are a shareholder. Accordingly for the purposes of the Takeover Code, the Nuformix Shareholders, together with their respective Connected Persons and other parties acting in concert with them, form the Concert Party.

On completion of the Acquisition, the Concert Party will hold more than 50 per cent. of the voting share capital of the Company and may be able to increase its aggregate shareholding in the Company without incurring any obligations under Rule 9 to make a general offer to the Company's other Shareholders.  Under the Takeover Code, whilst each member of the Concert Party continues to be treated as acting in concert, each member will be able to increase further his respective percentage shareholding in the voting rights of the Company without incurring an obligation under Rule 9 to make a general offer to Shareholders to acquire the entire issued share capital of the Company.  However, individual members of the Concert Party will not be able to increase their percentage shareholding through or between a Rule 9 threshold without the consent of the Panel.  In the event that the Waiver is approved at the General Meeting, the Concert Party (or its Connected Persons or other persons acting in concert with it) will not be restricted from making an offer for the Company.

Maximum potential controlling position

As at the date of the Prospectus the members of the Concert Party have no interest in the Company's Existing Ordinary Shares.

Following completion of the Acquisition and on Re-Admission the members of the Concert Party will, in aggregate, be interested in 300,000,000 Ordinary Shares in the Company representing 65.11 per cent. of the Enlarged Share Capital. Should the Concert Party exercise in full all Options held by them, its aggregate interest in the Diluted Enlarged Share Capital would be 70.93 per cent. The interest of the Concert Party on completion of the Proposals will be as follows:

Concert Party Member	Number of Existing Ordinary Shares	Percentage of Existing Ordinary Shares	Number of Shares held on completion of the Acquisition	Percentage of Enlarged Share Capital	Number of Options	Percentage of the Diluted Enlarged Share Capital*
David Tapolczay	0	0	45,000,000	9.77%	18,430,000	11.47%
Daniel Gooding	0	0	37,500,000	8.14%	36,860,000	13.45%
Alan Chorlton	0	0	42,000,000	9.12%	-	7.60%
Joanne Holland	0	0	37,500,000	8.14%	36,860,000	13.45%
Christopher Frampton	0	0	9,000,000	1.95%	-	1.63%
Stephen Cash	0	0	2,100,000	0.46%	-	0.38%
CPI Innovation Services Limited	0	0	62,700,000	13.61%	-	11.34%
Spreadex Ltd	0	0	64,200,000	13.93%	-	11.61%
TOTALS	0	0	300,000,000	65.11%	92,150,000	70.93%

* This column assumes that members of the Concert Party exercise all of their Options but that none of the Founder Warrants, EGR Warrants, Whitman Howard Warrants, Shakespeare Martineau Warrants, Existing Director Warrants or the Convertible Loan Note Warrants and Shares are exercised and/or issued.  The maximum potential ownership of the Enlarged Group by the Concert Party is therefore 70.93 per cent.

The Panel on Takeovers and Mergers has agreed to waive the obligation of the members of the Concert Party to make a general offer that would otherwise arise as a result of the acquisition of Consideration Shares pursuant to the Share Purchase Agreement or upon any subsequent exercise of the Options to subscribe for Ordinary Shares, which have been granted to them as described in the paragraph above. Accordingly, the Whitewash Resolution seeks to waive the requirement under Rule 9 of the Takeover Code that the Concert Party having acquired a shareholding and percentage of Voting Rights exceeding 30 per cent., must make a general cash offer to all the remaining Shareholders to acquire their shares. In accordance with the Takeover Code, the Whitewash Resolution is being proposed at the General Meeting to approve this Waiver and will be taken on poll. No member of the Concert Party will be entitled to vote on the Whitewash Resolution and accordingly no member of the Concert Party will do so. The Panel confirmation to waive the obligation of the Concert Party under Rule 9 has been given on the basis that the consequences of such an exercise have been fully disclosed in the Prospectus.

Intention of the Concert Party and lock-in agreements

The Company is currently a listed public company with a cash balance of £5,895 as at 31 March 2017. Following completion of the Proposals, the business of the Company will constitute that of Nuformix's business and will be run from Company's offices at 5 Edinburgh House, St Johns Innovation Park, Cowley Road, Cambridge CB4 0DS, UK. The Enlarged Group will focus on pharmaceutical research and development, specifically the application of cocrystal technology to develop innovative pharmaceutical products that address unmet medical needs. The Concert Party considers that its strategic plans will have no repercussions on the location of Nuformix's place of business. The Company has no fixed assets. The Company has two employees whose employment contracts will be terminated on completion of the Acquisition. The Company has a service agreement in place in respect of an office. Notice has been given to terminate the service agreement. As such, the Concert Party is also not intending to prejudice the existing employment rights, including pension rights, of any of the employees or management of the Enlarged Group nor to take any steps to amend the Company's share trading facilities in force at the date of the Prospectus.

Although it is not mandatory in respect of companies listed on the standard listing segment of the Official List to do so, the members of the Concert Party have entered into Lock-in Agreements dated 15 September 2017, which govern the acquisition and disposal and dealings in certain Ordinary Shares following Re-Admission by members of the Concert Party. Further details of the Lock-in Agreements are set in the Prospectus.

The only Independent Director, Professor John Lidgey, who will be able to vote on the Whitewash Resolution (Resolution 3), has irrevocably committed to the Company and Whitman Howard to vote in favour of all the Resolutions, including the Whitewash Resolution, in respect of his holding of 1,000,000 Existing Ordinary Shares representing 1.04 per cent. of the Existing Share Capital. Mr Anthony Reeves and Mr Pascal Hughes, being the other Existing Directors, will not be permitted to vote on the Whitewash Resolution due to being issued Existing Director Warrants and/or Success Fee Shares and accordingly they have irrevocably committed to the Company and Whitman Howard to vote in favour of the other Resolutions, in respect of their (and their connected persons) aggregate holdings of 6,750,000 Existing Ordinary Shares representing approximately 7.05 per cent. of the Existing Ordinary Shares.

Placing

The Company has issued 57,500,000 Placing Shares at 4p per share conditional, inter alia, upon Re-Admission occurring and becoming effective by 8.00 a.m. London time on or prior to 16 October 2017 (or such later date as the Company may agree). The rights attaching to the Ordinary Shares will be uniform in all respects and all of the Ordinary Shares will form a single class for all purposes.

Proposed Share Options

Subject to the approval of the Shareholders the Company intends to grant the Unapproved Options to Daniel Gooding, Joanne Holland and David Tapolczay as more particularly detailed in the Document.

The Company also intends to establish an EMI Option Scheme on the terms described in the Document.

Appendix 2

Notice of General Meeting

The Company gives notice convening a general meeting which will be held at the offices of Shakespeare Martineau LLP, 60 Gracechurch Street, London EC3V 0HR on 13 October 2017 at 12.00 p.m. (or any adjournment thereof) for the purpose of:

(a)  considering in accordance with section 656 of the Companies Act 2006 whether any, and if so what, steps should be taken to deal with the situation that the net assets of the Company currently represent less than half of its called-up share capital; and

(b)  considering and, if thought fit, passing the following resolutions, the first five of which will be proposed as ordinary resolutions (with the third being taken on a poll) and the remaining two resolutions which will be proposed as a special resolutions.

Ordinary Resolutions

Resolution 1: to approve the Acquisition, subject to the passing of each of the other Resolutions.

Resolution 2: to authorise the Directors to issue and allot equity securities (as defined by section 560 of the Companies Act 2006) up to an aggregate nominal amount of £519,250.00, subject to the passing of each of the other Resolutions.

Resolution 3: (which will be taken on a poll of Independent Shareholders present and by proxy voting at the Meeting) to approve the Waiver of any obligation which might otherwise arise under Rule 9 of the City Code for the Concert Party to make a general offer for the Company as a result of the Acquisition and/or any valid exercise of Options and/or Warrants (Shareholders should note that members of the Concert Party will not be permitted to vote on this Resolution 3), subject to passing of each of the other Resolutions.

Resolution 4: to approve the issue of Options, Whitman Howard Warrants, Shakespeare Martineau Warrants and Existing Director Warrants, subject to the passing of each of the other Resolutions.

Special Resolutions

Resolution 5: to change the name of the Company to Nuformix Plc on completion of the Acquisition and Placing, subject to the passing of each of the other Resolutions.

Resolution 6: to disapply statutory pre-emption rights in respect of the issue and allotment for cash of Ordinary Shares pursuant to (a) the New Ordinary Shares, Consideration Shares, Success Fee Shares, Convertible Loan Note Shares and Whitman Howard Fee Shares and (b) valid exercise of the Options and (c) valid exercise of the Whitman Howard Warrants, Shakespeare Martineau Warrants, Convertible Loan Note Warrants and Existing Director Warrants and (d) in addition, up to a further 46,075,000 Ordinary Shares, subject to the passing of each of the other Resolutions.

Actions to be taken in relation to the General Meeting

Shareholders will find enclosed a form of proxy for use at the General Meeting. Whether or not you intend to be present at the General Meeting, you are requested to complete and return the form of proxy in accordance with the instructions printed therein so as to be received as soon as possible by the Company to Capita Asset Services, PXS1, 34 Beckenham Road, Beckenham, BR3 42F but, in any event, so that it is received no later than 12.00 p.m. on 11 October 2017. The completion and return of a form of proxy will not preclude you from attending and voting in person at the meeting, if you so wish.

Recommendation

John Lidgey, being the Independent Director, is of the opinion that the Proposals are in the best interest of Shareholders and the Company as a whole. Accordingly, the Independent Director recommends that Shareholders vote in favour of each of the Resolutions.

John Lidgey, being the Independent Director, having been so advised by Whitman Howard, believes that the Whitewash Resolution and the Proposals as a whole are fair and reasonable and in the best interest of the Independent Shareholders and the Company as a whole. In providing advice, Whitman Howard has taken into account the Independent Director's commercial assessment. Accordingly, the Independent Director recommends that the Independent Shareholders vote in favour of the Whitewash Resolution to approve the Rule 9 Waiver. It should be noted that the other Existing Directors are not treated as independent and will not be voting on the Whitewash Resolution (Resolution 3).

Appendix 3

Important Information

The information contained in this announcement is not for release, publication or distribution to persons in the United States, Australia, Canada or Japan or in any jurisdiction where to do so would breach any applicable law. No public offer of securities is being made by virtue of this announcement.

This announcement has been prepared for the purposes of complying with the applicable law and regulation of the United Kingdom and the information disclosed may not be the same as that which would have been disclosed if this announcement had been prepared in accordance with the laws and regulations of any jurisdiction outside of the United Kingdom.

Neither the content of the Company's website (or any other website) nor any website accessible by hyperlinks on the Company's website (or any other website) is incorporated in, or forms part of, this announcement.

Any person receiving this announcement is advised to exercise caution in relation to the contents. If in any doubt about any of the contents of this announcement, independent professional advice should be obtained.

Whitman Howard Limited ("Whitman Howard"), which is authorised and regulated by the Financial Conduct Authority in the conduct of investment business, is acting exclusively for the Company and for no-one else in connection with the Acquisition, Placing and Re-Admission and will not be responsible to anyone other than the Company for providing the protections afforded to customers of Whitman Howard or for providing advice in relation to the contents of the Prospectus or any matter referred to in it.

Whitman Howard is not making any representation, express or implied, as to the contents of the Prospectus, for which the Company, the Existing Directors and the Proposed Directors are solely responsible. Without limiting the statutory rights of any person to whom the Prospectus is issued, no liability whatsoever is accepted by Whitman Howard for the accuracy of any information or opinions contained in the Prospectus or for any omission of information, for which and the Company, the Existing Directors and the Proposed Directors are solely responsible. The information contained in the Prospectus has been prepared solely for the purpose of the Acquisition, Placing and Re-Admission and is not intended to be relied upon by any subsequent purchasers of Ordinary Shares (whether on or off exchange) and accordingly no duty of care is accepted in relation to them.

The Existing Directors, and to the extent different persons, the Directors on Admission whose names appear on page 38 of the Prospectus, and the Company accept responsibility, both individually and collectively, for the information contained in the Prospectus. To the best of the knowledge of the Existing Directors, and to the extent different persons, the Directors on Admission, and the Company (who have taken all reasonable care to ensure that such is the case), the information contained in the Prospectus is in accordance with the facts and contains no omission likely to affect its import.

Each of the members of the Concert Party, whose names appear on page 44 of the Prospectus, accept responsibility for the information contained in the Prospectus relating to himself or itself. To the best of the knowledge and belief of each member of the Concert Party (who have taken all reasonable care to ensure such is the case) the information contained in the Prospectus for which they are responsible is in accordance with the facts and contains no omission likely to affect its import.

Appendix 4

Forward-looking statements

The Prospectus includes statements that are, or may be deemed to be, "forward-looking statements". In some cases, these forward-looking statements can be identified by the use of forward-looking terminology, including the terms "targets", "believes", "estimates", "anticipates", "expects", "intends", "may", "will", "should" or, in each case, their negative or other variations or comparable terminology. They appear in a number of places throughout the Document and include statements regarding the intentions, beliefs or current expectations of the Company and the Board concerning, among other things: (i) the Company's objective and financing strategies, results of operations, financial condition, capital resources, prospects, capital appreciation of the Ordinary Shares and dividends; and (ii) future deal flow and implementation of active management strategies. By their nature, forward-looking statements involve risks and uncertainties because they relate to events and depend on circumstances that may or may not occur in the future. Forward looking statements are not guarantees of future performances. The Company's actual performance, results of operations, financial condition, distributions to shareholders and the development of its financing strategies may differ materially from the forward-looking statements contained in the Prospectus. In addition, even if the Company's actual performance, results of operations, financial condition, distributions to shareholders and the development of its financing strategies are consistent with the forward-looking statements contained in the Prospectus, those results or developments may not be indicative of results or developments in subsequent periods.

Prospective investors should carefully review the "Risk Factors" section of the Prospectus for a discussion of additional factors that could cause the Company's actual results to differ materially, before making an investment decision. For the avoidance of doubt, nothing in this paragraph constitutes a qualification of the working capital statement contained in paragraph 9 of Part VII of the Prospectus (Additional Information).

Forward-looking statements contained in the Prospectus apply only as at the date of the Prospectus. Subject to any obligations under Listing Rules, the Disclosure and Transparency Rules and the Prospectus Rules, the Company undertakes no obligation publicly to update or review any forward-looking statement, whether as a result of new information, future developments or otherwise.

Appendix 5:

Expected Timetable of Principal Events

Publication of the Prospectus	15 September 2017
Latest time and date for receipt of Forms of Proxy for the General Meeting	12.00 p.m. on 11 October 2017
General Meeting	12.00 p.m. on 13 October 2017
Completion of Acquisition	13 October 2017
Issue of Consideration Shares	13 October 2017
Issue of Placing Shares	13 October 2017
Cancellation of trading of Existing Ordinary Shares	8.00 a.m. on 16 October 2017
Re-Admission of the Enlarged Share Capital effective and commencement of dealings in Ordinary Shares	8.00 a.m. on 16 October 2017
Dispatch of definitive share certificates for Consideration Shares and Placing Shares	Within ten Business Days of allotment

1.    All times shown in the Prospectus are London GMT times unless otherwise stated. The dates and times given are indicative only and are based on the Company's current expectations and may be subject to change. If any of the times and/or dates above change the revised times and/or dates will be notified to Shareholders by announcement through the Regulatory News Service of the London Stock Exchange.

2.    If the General Meeting is adjourned, the latest time and date for receipt of Forms of Proxy for the adjourned meeting will be notified to Shareholders by announcement through the Regulatory News Service of the London Stock Exchange.

Statistics

Total number of Existing Ordinary Shares as at the date of the Prospectus	95,750,000
Number of Consideration Shares to be issued pursuant to the Acquisition	300,000,000
Number of Placing Shares to be issued conditional on, inter alia, Re-Admission	57,500,000
The Enlarged Share Capital following completion of the Transactions	460,750,000
Number of Consideration Shares to be issued pursuant to the Acquisition as a percentage of the Enlarged Share Capital	65.11 per cent.
Number of Placing Shares to be issued pursuant to the Placing as a percentage of the Enlarged Share Capital	12.48 per cent.
Estimated expenses of the Re-Admission, Placing and Acquisition	£461,000
Estimated Net Proceeds receivable by the Company	£1,830,000
Closing Price	3.50p
Market capitalisation of the Company at the Closing Price	£3,351,250

Dealing codes:

ISIN:	GB00BYW79Y38
SEDOL:	BYW79Y3
EPIC/TIDM:	LVRT

 

END

 

 

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