KRM22 plc (LON:KRM), the technology and software investment company, today announced that further to the announcement made of 11 May 2020, it has concluded the equity fundraising and has conditionally raised gross proceeds of approximately £1.145 million through a placing of 3,816,666 new ordinary shares of 10 pence each in the Company at a price of 30 pence per Ordinary Share from new and existing shareholders. The Placing uses the Company’s existing share authorities to issue the Placing Shares.
The Company has also received notice from Keith Todd, Executive Chairman and CEO of the Company, Kim Suter, Chief Financial Officer, and Steve Sparke, Non-Executive Director and an employee of the Company of their intention to make a further equity investment of an aggregate of approximately £135,000 in the Company in which they have irrevocably committed to subscribe for those 449,998 new Ordinary Shares at the Placing Price following the publication of the Company’s final results, which is expected in the week commencing 18 May 2020.
Summary of the Placing and Admission
· The Placing shall raise gross proceeds of approximately £1.145 million at a price of 30 pence per Placing Share;
· The net proceeds of the Placing will be used for general working capital purposes;
· finnCap Ltd has acted as nominated adviser, broker and sole bookrunner in connection with the Placing. The Placing is not underwritten; and
· Application will be made for the Placing Shares to be admitted to trading on AIM. It is expected that that Admission will become effective at 8.00 a.m. on 18 May 2020 and that dealings in the Placing Shares will commence at that time.
Details of the Placing
The Placing Shares, when issued, will represent approximately 18.2 per cent. of the Company’s issued share capital prior to the Placing. The Placing Price of 30 pence per Placing Share represents a premium of approximately 9.1 per cent. to the closing mid-market price of 27.5 pence per Ordinary Share on 13 May 2020, being the last trading day immediately preceding the date of this announcement.
The Placing Shares, when issued, will be fully paid and will rank pari passu in all respects with the existing 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.
In accordance with the terms of the placing agreement dated 13 May 2020 entered into between the Company and finnCap, the Company has, via finnCap as placing agent, conducted a conditional placing to raise approximately £1.145 million by way of the issue of 3,816,666 Placing Shares at the Placing Price.
The Placing Agreement is conditional, inter alia, upon:
a. the Company complying with its obligations under the Placing Agreement to the extent that they fall to be performed on or before Admission;
b. the Company having allotted, subject only to Admission, the Placing Shares in accordance with the Placing Agreement; and
c. Admission having become effective at or before 8.00 a.m. on 18 May 2020 or such later time as finnCap may agree with the Company (being not later than 16 June 2020).
Application has been made for the Placing Shares to be admitted to trading on AIM. Settlement for the Placing Shares and Admission is expected to take place at 8.00 a.m. on 18 May 2020. On Admission, the Company’s issued share capital will comprise 24,814,695 Ordinary Shares, with no Ordinary Shares held in treasury. Therefore, the total number of Ordinary Shares in the Company with voting rights will be 24,814,695. This figure may be used by shareholders in the Company as the denominator for the calculations by which they will determine if they are required to notify their interest in, or a change to their interest in, the share capital of the Company under the FCA’s Disclosure Guidance and Transparency Rules.
Director and Employee Participation
As announced on 11 May 2020, Keith Todd, Executive Chairman and CEO of the Company, Kim Suter, Chief Financial Officer, and Steve Sparke, Non-Executive Director and an employee of the Company have notified the Board of their intention to make a further equity investment of an aggregate of approximately £135,000 in the Company in which they have irrevocably committed to subscribe for those 449,998 new Ordinary Shares at the Placing Price following the publication of the Company’s final results, which is expected in the week commencing 18 May 2020. The Subscription by those Directors will constitute related party transactions and a further announcement will be made when the Subscription is complete.
This Announcement should be read in its entirety and in conjunction with the “Update on Equity Fundraising” announcement of 11 May 2020. In particular, you should read and understand the information provided in the “Important Notices” section of this Announcement.
Keith Todd CBE, Executive Chairman and Chief Executive Officer at KRM22 commented:
“I am delighted that we have been supported by core and new shareholders to provide the Company with additional working capital to support our growth strategy. The Placing together with our committed debt facility will strengthen the available liquidity during a time of uncertainty caused by Covid-19. We are encouraged by the breadth and depth of engagement with current customers and new prospects in all regions of the world and look forward to updating shareholders on this soon.”