15th Jun 2005 07:00
Imagination Technologies Group PLC15 June 2005 15 June 2005 NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION IN, INTO, OR FROM THE UNITED STATESOF AMERICA, AUSTRALIA, CANADA, JAPAN, THE REPUBLIC OF IRELAND AND THE REPUBLICOF SOUTH AFRICA AND THEIR RESPECTIVE TERRITORIES AND POSSESSIONS Members of the public are not eligible to take part in the Placing describedbelow. Invitations to participate in the Placing will be limited to RelevantPersons (as defined in the terms of, and conditions to, the Placing which areappended to this announcement). Your attention is drawn to the section marked "GENERAL" at the end of thisannouncement. The full terms of and conditions to the Placing are appended to thisannouncement. This announcement is solely the responsibility of the Company and its directors.Neither JPMorgan Cazenove Limited, its affiliates ("JPMorgan Cazenove") norany of their respective subsidiaries, directors, employees and agents accept anyliability whatsoever for the accuracy of any information or opinions containedin this announcement or for the omission of any material information, for whichthey are not responsible. Imagination Technologies Group plc announces an underwritten cash placing to raise £9.45 million Introduction Imagination Technologies Group plc (the "Company" and, together with itssubsidiaries, "Imagination") today announces that it is seeking to raise £9.45million (before expenses) by means of a placing (the "Placing") of 15,000,000new ordinary shares of 10 pence each in the capital of the Company (the "PlacingShares") at a price of 63 pence per Placing Share (the "Placing Price"). The Placing Shares are equivalent to approximately 7.93 per cent. of theCompany's existing issued share capital and will, when issued, representapproximately 7.35 per cent. of the Company's enlarged issued share capital.Due to the size of the Placing, shareholder approval will be sought to approvethe disapplication of statutory rights of pre-emption contained in section 89 ofthe Companies Act 1985. Accordingly, a circular is expected to be sent today tothe Company's shareholders convening an extraordinary general meeting for 10:00a.m. on 8 July 2005 at which a special resolution disapplying these statutorypre-emption rights will be proposed (the "Resolution"). The net proceeds of the Placing will be used to supplement existing resourcesand strengthen the financial position of the Company in order to provide comfortto existing and prospective commercial partners. The additional funds will alsobe available to fund working capital at a time when Imagination remains heavilydependent on licensing income, the timing of which can be difficult to predict. JPMorgan Cazenove is acting as financial adviser and bookrunner in relation tothe Placing. Details of the Placing The Company is proposing to raise approximately £9.45 million (before expenses)by means of the Placing. The Placing Shares are to be placed with institutionalinvestors only; members of the public are not eligible to participate in thePlacing. The Placing Shares will be acquired by placees on the basis that theyhave not relied on any information, representation and/or warranty from JPMorganCazenove or the Company, save for the information contained in this announcementand the terms and conditions appended hereto. Application will be made to the Financial Services Authority and to London StockExchange plc (the "LSE") for the Placing Shares to be admitted to, respectively,the Official List and trading on the LSE's market for larger and establishedcompanies ("Admission"). Subject (amongst other things) to the Resolution beingpassed, it is expected that Admission will become effective at 8.00 a.m. (Londontime) on 11 July 2005 and that dealings in the Placing Shares will commence atthat time. The Placing is fully underwritten and is conditional on the placing agreemententered in to in connection with the Placing (the "Placing Agreement") becomingunconditional in all respects by 8.00 a.m. on 11 July, 2005 (or such later timeor date as the parties thereto may agree, being not later than 8.00 a.m. on 1August, 2005). These conditions include (i) the passing of the Resolution(without amendment), and (ii) Admission becoming effective by the time and datedescribed above. In addition, the Placing Agreement may be terminated at anytime prior to Admission in certain circumstances, including any of thewarranties and undertakings contained in the Placing Agreement not being, orceasing to be, true and accurate in all material respects and there havingoccurred or come into effect any event or omission which is or may be materiallyadverse to the Company or to the underwriting of the Placing. Given the small size of the Placing in both monetary terms and the number ofPlacing Shares as a percentage of the Company's existing issued share capital,the Placing is being made on a non pre-emptive basis as the time and costsassociated with a pre-emptive offer are considered by the directors of theCompany (the "Directors") to be disproportionate to the transaction. Background to and reasons for the Placing The Directors believe that Imagination has made significant strategic progressduring the last financial year in securing important long-term new and expandedpartnerships. These include the addition of Freescale (formerly thesemiconductor arm of Motorola Inc.) for PowerVR MBX mobile graphics, majorextensions to existing agreements for MBX technology with Intel and TexasInstruments, a major licence upgrade with Sharp and an agreement with FrontierSilicon for mobile TV technology. More recently, an agreement was also signedwith Intel for Imagination's new generation graphics and video technologyintellectual property ("IP"). Imagination now has licensing agreements in place,in several cases expanded by repeat business, with the majority of the globaltop ten semiconductor companies as well as other leading companies in theindustry. The Directors believe these developments show that Imagination's IP isplaying an increasingly important role in the product development plans ofImagination's partners. Whilst the Directors believe that the last 12 months have seen strong strategicprogress, the trading result in the last financial year was impacted by timingdelays in the closure of licensing business and in the build up of royaltyvolume, which was slower than expected due to partner project timing andintegration of software into end products. As a result, there was an operatingcash outflow of £5.5 million in the year. Whilst licensing revenue flows can be uneven, the Directors consider that it isnevertheless critical to maintain on-going investment in research anddevelopment to ensure that Imagination's IP development programmes stay on trackto deliver an industry-leading technology roadmap and support its growingcustomer base. Similarly, the Directors consider that it is important from acommercial perspective to be able to demonstrate a financially secure positionto both prospective and existing partners, a number of which have Imagination'sIP as a fundamental part of their product development plans. With the number of committed partner chips now increased to 28, up from 20 lastyear, including seven chips now shipping and ten others already at prototypestage, the Directors believe that the visibility of expected royalty revenuegrowth is improving. The shipment of chips incorporating Imagination's IP morethan doubled last year to 2.5 million and the Directors expect to showsignificant growth as existing chips increase volume and additional partnerchips come to market. The Directors believe that the prospects for Imagination's technology in themobile phone market, in particular, are strong. This is based on the calibre ofImagination's existing partners (which include Freescale, Intel, Philips,Renesas, Samsung and Texas Instruments) who have committed to Imagination's IPfor their mobile phone market graphics solutions, the announcement of a numberof mobile phone chips by these partners, and end user devices usingImagination's IP already starting to ship. 1.4 million mobile phone chipsincorporating Imagination's IP were shipped in the second half of last yearbased on the launch of only three end user mobile devices from Dell, Fujitsu andMitsubishi. With Imagination's existing partners commanding a majority of the market forchips used in the mobile phone market and the proportion of the market requiringhardware graphics and video acceleration anticipated to grow rapidly over thenext few years, the Directors believe that there is potential for chips inmobile handsets incorporating Imagination's IP to reach volumes in hundreds ofmillions per annum. In addition to the mobile phone market, the Directors alsoexpect the number of chips shipping with Imagination's IP to grow in the DABdigital radio market (where Imagination's technology has a dominant marketshare), and the car navigation, TV and mobile TV markets. With regard to licences, Imagination continues to have a very active pipeline ofnegotiations and opportunities in its key markets, with a number of these at anadvanced stage, expected to close in the current financial year. Specifically,the Directors believe that there is strong potential for its PowerVR MBX,technology; its new family of next generation graphics/video technology (whereImagination has already secured Intel as a lead partner); and its Ensigmacommunication and Metagence processor technologies in the TV and mobile TVsegments. However, as the last financial year demonstrated, the precise timingof licensing business closure is difficult to predict with certainty; theeventual timing of licensing deal closures often depending on both partners'design cycles and the industry's overall outlook. The Directors consider that the quality of Imagination's committed partners, thestrength of its engagements, the market position secured and the increased rateat which Imagination's IP is incorporated into end products are testimony to thecompetitiveness of Imagination's IP and are a solid foundation for futuregrowth. Accordingly, the Directors believe that a fundraising is a prudentmeasure in order to be able to demonstrate financial security and ensure thatImagination can maintain the necessary research and development investment andcustomer support so that the business is well positioned to exploit significantcommercial opportunities. In conclusion: • Significant strategic progress has been made with partners in 2004/05,but licence revenue was slower than anticipated and the operating cash outflowwas £5.5 million; • Major licensees are extending their existing licenses, including newgeneration technology; • Royalty revenues are expected to show significant growth acrossImagination's main markets; • The majority of the global top ten semiconductor companies havecommitted to developing Imagination's MBX IP into their mobile graphics productswith several chips already announced and some shipping; • End user products incorporating MBX are now being sold in the UnitedStates, Europe and the Far East and royalty revenue is coming through, with (theDirectors believe) the potential to reach volumes in hundreds of millions perannum; • The number of chips shipping with Imagination's IP is also expected togrow in the DAB digital radio, car navigation, TV and mobile TV markets; and • The timing of licence revenues remains difficult to predict accuratelyand, whilst the Directors expect Imagination to move into a profitable and cashgenerative position in the medium term, they consider that the proceeds of thePlacing are required to demonstrate financial security to the Company's partnersand to ensure financial stability in the short term in the event that licencedeals do not to complete as soon as expected. Use of proceeds and financial effects of the Placing The proceeds of the Placing will be used to supplement existing resources anddemonstrate a strengthened financial position to existing and prospectivepartners. The additional funds will also be available to fund working capital ata time when Imagination remains heavily dependent on licensing income, thetiming of which can be difficult to predict. The Placing is intended to allow Imagination to continue to support and grow itsbusiness over the medium term, to the benefit of all of the Company'sshareholders. Further information on Imagination Imagination develops, licenses and supplies graphics, video and display cores,real-time multi-threaded DSP/RISC processors and communication and broadcasttechnologies for the mobile, consumer, automotive and PC markets. It supplies licensable IP supported by advanced development tools to leadingsemiconductor and consumer electronics companies worldwide. Imagination employs over 300 people, with over 70 per cent. of those beingengineers in silicon and software design teams. It has its headquarters in KingsLangley, Hertfordshire (UK) and offices in Chepstow (UK), Leeds (UK), San Diego(USA) and Tokyo (Japan). Imagination's IP has been licensed to companies such as Freescale, Intel, NECCorporation, Philips Semiconductor, Renesas, Samsung, Sega Corporation, SharpCorporation, STMicroelectronics and Texas Instruments. Additionally, Imagination has a strategic partnership with ARM, which licensesspecific Imagination graphics cores for use alongside its own cores. Imagination also has licensing and/or development relationships withbroadcasting companies such as Digital One and fabless semiconductor companiessuch as Frontier Silicon and Sunplus. Current trading and prospects As the Company reported on 25 May 2005 in the announcement of its preliminaryresults for the year ended 31 March 2005, the quality of Imagination's partners,the scale of partner chip design wins and the significant role its technologiesplay in its partners' roadmaps will increasingly accelerate volume growth,particularly in the mobile phone market, and hence its royalty revenues. It isthese increasing royalty flows which are expected to move the business into aprofitable and cash-generative position. It is also expected that there will bean increased news flow in the coming year as more end-user products are launchedand more partners commit to Imagination's current and future technologiesalthough the closure of new deals will be subject to the usual timinguncertainties. Enquiries Imagination Technologies Group plc 01923 260 511Geoff ShinglesHossein YassaieTrevor Selby JPMorgan Cazenove Limited 020 7588 2828David Anderson GENERAL JPMorgan Cazenove, which is authorised and regulated in the United Kingdom bythe Financial Services Authority, is acting exclusively for Imagination asfinancial adviser and bookrunner and no one else in relation to the Placing andwill not be responsible to any other person (whether or not such person is inreceipt of this announcement) for providing the protections afforded to itscustomers or for advising any other person in relation to the Placing. Certain statements made in this announcement are forward looking statements.Such statements are based on current expectations and are subject to a number ofrisks and uncertainties that could cause actual results and performance todiffer materially from any expected future results or performance, express orimplied, by the forward looking statements. Factors that might cause forwardlooking statements to differ materially from actual results include, among otherthings, political, regulatory and economic factors. Imagination assumes noresponsibility to update any of the forward looking statements contained in thisannouncement. Further, any indication in this announcement of the price atwhich ordinary shares of Imagination have been bought or sold in the past cannotbe relied upon as a guide to future performance. This announcement and the information contained herein is not for publication ordistribution to persons in the United States, Australia, Canada, Japan, theRepublic of Ireland, the Republic of South Africa or in any jurisdiction inwhich such publication or distribution is unlawful. Members of the general public are not eligible to take part in the Placing.This announcement, in so far as it constitutes an invitation or inducement toparticipate in the Placing, is only aimed at and directed to persons in theUnited Kingdom who (i) at all relevant times, have professional experience inmatters relating to investments and who are "investment professionals" (withinthe meaning of the Financial Services and Markets Act 2000 (Financial Promotion)Order 2001 (as amended)) and (ii) (aa) prior to 1 July 2005, are persons whoseordinary activities involve them in acquiring, holding, managing or disposing ofinvestments (as principal or agent) for the purpose of their business and (bb)from 1 July 2005, are "qualified investors" (within the meaning of section 86(7)(a) of the Financial Services Markets Act 2000 then in force) ("Relevant Persons"). This announcement, in so far as it constitutes an invitation or inducementto participate in the Placing, must not be acted on or relied on by persons whoare not Relevant Persons. Any investment or investment activity in so far asrelating to participation in the Placing is available only to Relevant Personsand will be engaged in only with Relevant Persons. The making of an offer in certain jurisdictions or to residents who are citizensof certain jurisdictions ("Foreign Persons"), may be restricted by laws orregulations of the relevant jurisdictions. Foreign Persons should informthemselves about and observe any such applicable legal requirements in theirrespective jurisdiction. This announcement does not constitute an offer to sell or issue, or constitutethe solicitation of an offer to acquire or buy, any Placing Shares to anyForeign Persons to whom it is unlawful to make such offer or solicitation insuch jurisdiction. The Placing Shares have not been, and will not be, registered under the UnitedStates Securities Act 1933, as amended (the "US Securities Act") or with anysecurities regulatory authority of any State or other jurisdiction of the UnitedStates, and accordingly may not be offered or sold in the United States unlessregistered under the US Securities Act or pursuant to an exemption from suchregistration. No regulatory authority has passed upon or endorsed the merits ofthe offering of the Placing Shares or the accuracy or adequacy of this document.Any representation to the contrary is a criminal offence in the United States. TERMS AND CONDITIONS OF THE PLACING MEMBERS OF THE PUBLIC ARE NOT ELIGIBLE TO TAKE PART IN THE PLACING. THE TERMSAND CONDITIONS SET OUT HEREIN ARE ONLY DIRECTED TO AND AIMED AT PERSONS SELECTEDBY JPMORGAN CAZENOVE WHO (i) AT ALL TIMES HAVE PROFESSIONAL EXPERIENCE INMATTERS RELATING TO INVESTMENTS AND ARE "INVESTMENT PROFESSIONALS" WITHIN THEMEANING OF ARTICLE 19(5) OF THE FINANCIAL SERVICES AND MARKETS ACT 2000(FINANCIAL PROMOTIONS) ORDER 2001 (AS AMENDED) AND (ii)(aa) PRIOR TO 1 JULY2005, ARE PERSONS WHOSE ORDINARY ACTIVITIES INVOLVE THEM IN ACQUIRING, HOLDING,MANAGING OR DISPOSING OF INVESTMENTS (AS PRINCIPAL OR AGENT) FOR THE PURPOSES OFTHEIR BUSINESS AND (bb) FROM 1 JULY 2005, ARE "QUALIFIED INVESTORS" WITHIN THEMEANING OF SECTION 86(7) OF THE FINANCIAL SERVICES AND MARKETS ACT 2000 THEN INFORCE ("RELEVANT PERSONS"). THE TERMS AND CONDITIONS SET OUT HEREIN MUST NOT BEACTED ON OR RELIED ON BY PERSONS WHO ARE NOT RELEVANT PERSONS. ANY INVESTMENTACTIVITY TO WHICH THE TERMS AND CONDITIONS SET OUT HEREIN RELATE IS AVAILABLEONLY TO RELEVANT PERSONS AND WILL BE ENGAGED IN ONLY WITH RELEVANT PERSONS. These terms and conditions and the information contained herein are not forpublication or distribution, directly or indirectly, to persons in the UnitedStates of America, Canada, Australia, Japan, the Republic of South Africa, theRepublic of Ireland or in any jurisdiction in which such publication ordistribution is unlawful. Unless otherwise defined in these terms and conditions, words and expressionsused in these terms and conditions shall have the same meaning as in the pressannouncement dated 15 June 2005 to which they are appended (the "PressAnnouncement"). 1 INTRODUCTION These terms and conditions apply to Relevant Persons making an offer tosubscribe for Placing Shares under the Placing. Each Relevant Person to whom these conditions apply, as described above, whoconfirms its agreement to JPMorgan Cazenove (as agent of the Company) tosubscribe for Placing Shares (which may include any of JPMorgan Cazenove'snominees) (an "Investor") hereby agrees with JPMorgan Cazenove and the Companyto be bound by these terms and conditions as being the terms and conditions uponwhich Placing Shares will be issued under the Placing and to be providing therepresentations, warranties, acknowledgements and undertakings set out herein.An Investor shall, without limitation, become so bound if JPMorgan Cazenoveconfirms to the Investor its allocation of Placing Shares. The Placing Shares have not been and will not be registered under the USSecurities Act and may not be offered or sold within the United States ofAmerica absent registration or an exemption from registration under such Act. The Placing Shares have not been recommended, approved or disapproved by anyUnited States federal or state securities commission or regulatory authority.Furthermore, the foregoing authorities have not confirmed the accuracy ordetermined the adequacy of this document. Any representation to the contrary isa criminal offence in the United States of America. These terms and conditions do not constitute an offer to sell or issue orsolicitation of an offer to buy or subscribe for the Placing Shares in anyjurisdiction, including, without limitation, the United States of America,Canada, Australia or Japan, where it is unlawful to do so. The distribution ofthese terms and conditions and the Press Announcement and sale of orsubscription for the Placing Shares in certain jurisdictions may be restrictedby law. Relevant Persons to whose attention these terms and conditions havebeen drawn are required by the Company and JPMorgan Cazenove to informthemselves about and to observe any such restrictions. 2 AGREEMENT TO ACQUIRE ORDINARY SHARES Conditional on the passing of the Resolution and Admission occurring on or priorto 8.00 a.m. on 11 July 2005 (or such later date as JPMorgan Cazenove, J. P.Morgan Securities Ltd. (the "Underwriter") and the Company may agree (not beinglater than 1 August 2005)), an Investor agrees to subscribe for, at the PlacingPrice, the number of Placing Shares allocated to such Investor under the Placingin accordance with the arrangements described in the Press Announcement. To thefullest extent permitted by law, each Investor acknowledges and agrees that itwill not be entitled to exercise any remedy of rescission at any time. Thisdoes not affect any other rights such Investor may have. 3 PRINCIPAL TERMS OF THE PLACING This section gives details of the terms of and conditions to, and the mechanicsof participation in, the Placing. 3.1 JPMorgan Cazenove is arranging the Placing as an agent for and on behalfof the Company. Participation will only be available to persons (being RelevantPersons) invited to participate by JPMorgan Cazenove. 3.2 Potential Investors will be informed of their allocation of Placing Sharesprior to their confirming their participation in the Placing. 3.3 An Investor's irrevocable commitment to acquire a fixed number of PlacingShares at the Placing Price will be agreed with and confirmed by it orally and awritten confirmation in the form of a contract note (in either electronic orpaper form) will be dispatched as soon as possible thereafter. The Investor'soral confirmation to JPMorgan Cazenove constitutes an irrevocable, legallybinding contractual commitment to JPMorgan Cazenove, as agent for the Company,from the Investor to subscribe for a fixed number of Placing Shares on the termsand conditions set out herein. 3.4 There will be no commission payable in relation to the Placing Shares. 3.5 Save in respect of depositary receipt arrangements or clearance services(as to which see warranty 5.6 below), no United Kingdom stamp duty or stamp dutyreserve tax will be payable on the issue of the Placing Shares. 3.6 Investors will participate in the Placing on the basis of these terms andconditions and the Press Announcement. 3.7 The Placing Agreement contains standard conditions and termination rightsfor a placing in the nature of the Placing. By participating in the Placing,each Investor agrees with JPMorgan Cazenove and the Underwriter that theexercise by JPMorgan Cazenove and/or the Underwriter of any right of terminationor other discretion under the Placing Agreement shall be within the absolutediscretion of JPMorgan Cazenove and/or the Underwriter and that neither JPMorganCazenove nor the Underwriter need make any reference to the Investor and thatneither JPMorgan Cazenove nor the Underwriter shall have any liabilitywhatsoever to the Investor in connection with any such exercise. If the PlacingAgreement does not become unconditional or is terminated in accordance with itsterms, the Placing will not proceed, the rights, obligations and liabilities ofthe Investor will cease and determine and no claims will be capable of beingmade by the Investor in respect of the Placing and JPMorgan Cazenove will causeto be returned to the Investor, without interest, all monies received from theInvestor pursuant to the terms of the Placing at the risk of the Investor. 4 PAYMENT, REGISTRATION AND SETTLEMENT Each Investor undertakes to pay the Placing Price for the Placing Shares issuedto such Investor in such manner as shall be directed by JPMorgan Cazenove. Settlement of transactions in the Placing Shares will take place within theCREST system, subject to certain exceptions. JPMorgan Cazenove reserves theright (subject to compliance with applicable law and regulations) to requiresettlement for and delivery of the Placing Shares to the Investors in such othermeans that it deems necessary if delivery or settlement is not possible withinthe CREST system within the timetable set out herein or would not be consistentwith the regulatory requirements in the jurisdictions of such Investors. It is expected that settlement will take place on 11 July 2005. In the event of any failure by any Investor to pay as so directed by JPMorganCazenove, the relevant Investor shall be deemed hereby to have appointedJPMorgan Cazenove or any nominee of JPMorgan Cazenove to sell (in one or moretransactions) in accordance with applicable law and regulations any or all ofthe Placing Shares in respect of which payment shall not have been made asdirected by JPMorgan Cazenove and to indemnify on demand JPMorgan Cazenove inrespect of any liability for stamp duty and/or stamp duty reserve tax arising inrespect of any such sale or sales (together with any interest or penaltiesthereon). If Placing Shares are to be delivered to a custodian or settlement agent of anInvestor, the relevant Investor should ensure that the written confirmationreferred to above is copied and delivered immediately to the relevant personwithin that organisation. 5 REPRESENTATIONS AND WARRANTIES By receiving these terms and conditions, each Investor and any person acting onits behalf is deemed to represent and warrant to JPMorgan Cazenove and theCompany that: 5.1 it has read and understood these terms and conditions and the PressAnnouncement in their entirety; 5.2 if the Investor is a natural person, such Investor is not under the age ofmajority (18 years of age in the United Kingdom ("UK")) on the date of suchInvestor's agreement to subscribe for Placing Shares under the Placing; 5.3 in agreeing to subscribe for Placing Shares under the Placing, the Investoris relying on these terms and conditions and the Press Announcement and not onany other information or representation concerning the Company or the Placing. Such Investor agrees that neither the Company nor JPMorgan Cazenove nor any oftheir respective officers, partners, directors or employees will have anyliability for any such other information or representation and, to the extentthat any such person may be found to have any such liability, the Investorhereby waives any right that it may have to make any claim in relation thereto; 5.4 if the laws of any place outside the UK are applicable to the Investor'sagreement to subscribe for Placing Shares and/or acceptance thereof, suchInvestor has complied with all such laws and none of the parties mentioned underparagraph 1 above will infringe any laws outside the UK as a result of suchInvestor's agreement to subscribe for Placing Shares and/or acceptance thereofor any actions arising from such Investor's rights and obligations under theInvestor's agreement to subscribe for Placing Shares and/or acceptance thereofor under the articles of association of the Company (the "Articles"); 5.5 in the case of a person who confirms to JPMorgan Cazenove on behalf of anInvestor an agreement to subscribe for Placing Shares, that person representsand warrants that he has authority to do so on behalf of the Investor; 5.6 the Investor is not, and is not applying as nominee or agent for, a personwho is, or may be, mentioned in any of sections 67, 70, 93 or 96 of the FinanceAct 1986 (depository receipts and clearance services); 5.7 the Investor is a person who: (i) falls within paragraph (5) of Article 19 of the Financial Services andMarkets Act (Financial Promotion) Order 2001; and (ii) (a) prior to 1 July 2005, is a person whose ordinary activities involve itin acquiring, holding, managing or disposing of investments (as principal oragent) for the purposes of its business and (b) from 1 July 2005 untilAdmission, will be a "qualified investor" within the meaning of section 86(7) ofthe Financial Services and Markets Act 2000 then in force; 5.8 in the case of an Investor (or any person acting on its behalf) whoconfirms to JPMorgan Cazenove on behalf of an Investor an agreement to subscribefor Placing Shares and who is acting on behalf of a third party, that the termson which the Investor (or any person acting on its behalf) are engaged enable itto make investment decisions in relation to securities on that third party'sbehalf without reference to that party; 5.9 the Investor has complied with its obligations in connection with theprevention of money laundering under the Proceeds of Crime Act 2002 and theMoney Laundering Regulations 2003 (the " Regulations") and, if it is makingpayment on behalf of a third party, satisfactory evidence has been obtained andrecorded by it to verify the identity of the third party as required by theRegulations; 5.10 the Investor has complied and will comply with all applicable provisions ofthe Financial Services and Markets Act 2000 in force from time to time withrespect to anything done by it in relation to the Placing Shares in, orotherwise involving, the UK; and 5.11 the Investor has all necessary capacity and has obtained all necessaryconsents and authorities to enable it to commit to participate in the Placingand to perform its obligations in relation thereto (including, withoutlimitation, in the case of any person on whose behalf it is acting, allnecessary consents and authorities to agree to the terms set out or referred toin these terms and conditions). 6 ACKNOWLEDGEMENTS AND UNDERTAKINGS By participating in the Placing, each Investor (and any person acting on hisbehalf): 6.1 acknowledges that participation in the Placing is on the basis that it isnot and will not be a client or customer of JPMorgan Cazenove and that JPMorganCazenove shall not have any duties or responsibilities to it for providing theprotections afforded to its clients or customers or for providing advice inrelation to the Placing or in respect of any representations, warranties,undertakings or indemnities contained in the Placing Agreement or for theexercise or performance of any of the rights and obligations of JPMorganCazenove and/or the Underwriter thereunder, including any right to waive or varyconditions or exercise any termination right; 6.2 undertakes and agrees that: 6.2.1 the person whom it specifies for registration as holder of the PlacingShares will be (i) the Investor or (ii) the Investor's nominee, as the case maybe; 6.2.2 neither JPMorgan Cazenove nor the Company will be responsible for anyliability to stamp duty or stamp duty reserve tax resulting from failure toobserve this requirement; and 6.2.3 the Investor and any person acting on its behalf agrees to subscribe onthe basis that the Placing Shares will be transferred to the CREST stock accountof Cazenove Nominees Limited who will hold them as nominee on its behalf untilsettlement in accordance with its standing settlement instructions; 6.3 acknowledges that the content of the Press Announcement is exclusively theresponsibility of the Company and that neither JPMorgan Cazenove nor any personacting on its behalf is responsible for or shall have any liability for anyinformation, representation or statement relating to the Company contained inthe Press Announcement or any information previously published by or on behalfof the Company and will not be liable for any Investor's decision to participatein the Placing based on any information, representation or statement containedin these terms and conditions or the Press Announcement or otherwise; 6.4 acknowledges and understands that the Company and JPMorgan Cazenove willrely upon the truth and accuracy of the representations, warranties andacknowledgements in paragraphs 5 and 6 of these terms and conditions which shallbe given to each of JPMorgan Cazenove and the Company and shall be irrevocable; 6.5 acknowledges that the Placing Shares have not been and will not beregistered under the US Securities Act or the securities legislation of anyState of the United States, Australia, Canada, Japan, the Republic of SouthAfrica or the Republic of Ireland and, subject to certain exceptions, may not beoffered, sold, delivered or transferred, directly or indirectly, within thosejurisdictions; 6.6 undertakes and agrees that it will not offer or sell any Placing Shareswithin the United States except in accordance with Rule 903 of Regulation S ofthe US Securities Act or to QIBs pursuant to the exemption from the registrationrequirements of the US Securities Act provided by Rule 144A; and 6.7 undertakes and agrees that neither it nor its affiliates nor any personacting on its or their behalf have engaged in or will engage in any "generalsolicitation or general advertising" (within the meaning of Regulation D underthe US Securities Act) or "directed selling efforts" (as defined in Regulation Sunder the US Securities Act) in connection with any offer or sale of the PlacingShares. 7 SUPPLY AND DISCLOSURE OF INFORMATION If the Company or JPMorgan Cazenove or any of their respective agents requestany information about an Investor's agreement to subscribe for Placing Shares,such Investor must promptly disclose it to them. 8 MISCELLANEOUS The rights and remedies of JPMorgan Cazenove, the Company and the Underwriterunder these terms and conditions are in addition to any rights and remedieswhich would otherwise be available to each of them and the exercise or partialexercise of one will not prevent the exercise of others. If he is an individual, on application each Investor may be asked to disclose,in writing or orally, to JPMorgan Cazenove his nationality. All documents will be sent at the Investor's risk. They may be sent by post tosuch Investor at an address notified to JPMorgan Cazenove. Each Investor agrees to be bound by the Articles (as amended from time to time)once the Placing Shares which such Investor has agreed to subscribe for havebeen issued to such Investor. The contract to subscribe for Placing Shares and the appointments andauthorities mentioned herein will be governed by, and construed in accordancewith, the laws of England. For the exclusive benefit of the parties mentionedunder paragraph 1 above, each Investor irrevocably submits to the exclusivejurisdiction of the English courts in respect of these matters. This does notprevent an action being taken against an Investor in any other jurisdiction. In the case of a joint agreement to subscribe for Placing Shares, references toan Investor in these terms and conditions are to each such Investor and suchInvestors' liability is joint and several. The Company and JPMorgan Cazenove expressly reserve the right to modify thePlacing (including, without limitation, its timetable and settlement) at anytime before the allocations are determined. 9 SELLING RESTRICTIONS Prior to Admission, Investors may only offer or sell Placing Shares in theUnited Kingdom in circumstances which will not result in an offer to the publicin the United Kingdom within the meaning of the Financial Services and MarketsAct 2000 from time to time in force. This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
Imagination Technologies Group