24th Apr 2008 07:01
DDD Group PLC24 April 2008 EMBARGOED FOR 0700 ON 24 APRIL 2008 24 April 2008 DDD Group plc Issue of Convertible Loan Notes and Trading update Introduction DDD Group plc ("DDD" or the "Company") announces that on 23 April 2008 it issuedat their nominal value £510,000 of Convertible Loan Notes ("Notes") pursuant tothe existing authorities granted to the board of directors. The following is a summary of the main provisions of the Notes. The Notes havean annual interest rate of 8%. The Notes can be converted by the holders intoordinary shares of 10 pence each in the capital of the Company ("Shares") at aconversion price of 10 pence nominal amount of Notes per Share. The Company hasthe option to redeem the Notes at any time at a 5% premium to their nominalvalue plus accrued interest. Any Notes outstanding on 17 April 2010 will at theoption of the Company be repaid in cash or settled by the issue of Shares at theconversion price; in both cases accrued interest will be payable in cash. Commenting on the issue of the Notes, Paul Kristensen, Chairman of DDD said: "It is an endorsement of the improved commercial prospects of the Company thatwe have been able to raise funds through a debt instrument for the first time inour history. I am particularly appreciative of the continued support we havereceived from Arisawa Manufacturing. Since September 2007, the Company has announced a number of significantcommercial agreements with licensees including Arisawa Manufacturing and SamsungElectronics in the rapidly growing 3D HDTV markets that are generating highmargin development, licensing and royalty revenues. The Company is making excellent progress, and intends to play an important rolein transforming the visual experience with 3D software and content across allmajor consumer electronic devices." Enquiries: DDD GroupChris Yewdall, President & CEO +1 310 566-3340e-mail: [email protected] Brewin DolphinKen Fleming, Director - Corporate Finance +44 (0) 141 314 8114Paul Mason, Assistant Director - Corporate Finance +44 (0) 141 314 8208 The Note issue Firm commitments and subscriptions have been received from subscribers inrespect of all the Notes. Full conversion of the Notes into Shares, would resultin a 6.9% increase in the Company's existing issued share capital and suchShares, when issued, will rank pari passu in all respects with all otherexisting issued shares in the capital of the Company. Application will be madefor Shares issued on conversion of Notes to be admitted to trading on AIM. The issue of the Notes was conducted under the authority granted to the board ofdirectors pursuant to Section 120 the Company's Articles of Association. Theright of conversion of the Notes into ordinary shares falls within the currentpartial dis-application of pre-emption rights approved by shareholders at theJune 19th 2007 Annual Shareholders Meeting. The 10p conversion price represents a 90% premium to the closing mid marketprice of 5.25 pence per share on 23 April 2008 (being the latest practicabledate before this announcement). The net proceeds from the Placing of approximately £473,000 will allow theCompany to continue to develop its business activities with a particular focuson existing software and hardware licensing projects in the television market. Three of the Directors of DDD have agreed to subscribe for Notes. The nominalamount of the Notes that they have agreed to acquire and their underlyingpotential shareholdings upon conversion are set out in the table below: % interest in the Resultant holding enlarged share capital Existing Nominal Amount of assuming conversion of DDD assuming full Director shareholding Notes acquired of the Notes conversion of the NotesChristopher Yewdall 936,218 £15,000 1,086,218 1.37%Warren Littlefield 215,000 £25,000 465,000 0.58%Hans Roger Snook 2,300,302 £45,000 2,750,302 3.46% Arisawa Manufacturing Co., Ltd. ("Arisawa"), currently a holder of 28.64% of theexisting issued ordinary share capital of the Company has agreed to acquire£425,000 of the Notes (the "Transaction"). Upon full conversion, this wouldincrease Arisawa's current interest to 25,564,807 ordinary shares representing32.13% of the enlarged issued ordinary share capital of DDD (assuming fullconversion of all the Notes). The Transaction is a related party transaction for the purpose of AIM rule 13,Arisawa and certain Directors being related parties within the meaning of theAIM rules. The Directors of the Company, other than Messrs. Yewdall, Littlefieldand Snook and Dr Sanji Arisawa, consider, having consulted with the Company'snominated adviser, that the terms of the Transaction are fair and reasonableinsofar as the shareholders are concerned. In view of the potential for the Transaction to result in Arisawa's futureownership of more than 30% of the issued shares of the Company that wouldrequire Arisawa to tender an offer for the outstanding shares of the Company,the Company's nominated adviser has discussed whether Rule 9 of the TakeoverCode applies to the Company with the Takeover Panel. The Takeover Panel hasconfirmed to the Company's nominated advisor that the Company is not subject tothe Takeover Code (including Rule 9) since the Company's central management andcontrol is based outside the United Kingdom. Current trading Since the announcement of the interim results on 28 September 2007, the Companyhas made two significant commercial announcements. The first relates to thelicensing of the Company's TriDef 3D Experience 3D HDTV software to Samsung foruse with their new range of 3-D ready Plasma televisions. Samsung announced thelaunch of their 3D ready range of Plasma HDTVs in late February. Since theintroduction of the Company's TriDef 3D Experience for Samsung's range of 3DDLP(R) televisions in September 2007, the Company has shipped approximately6,000 TriDef 3D Experience licenses to 3D TV customers. In February 2008, the Company announced development and licensing agreementswith Samsung Electronics to integrate DDD's real-time 3D conversion and 3D imageprocessing capabilities into a custom chip for inclusion in Samsung's nextgeneration 3D HDTVs. The Company has made good progress with the developmentphase of the project, with two of the three milestones having been delivered.The third milestone is on target for completion in May 2008. The company hasrecognised approximately £81,000 of development revenue related to the 3D TVmarket in the first quarter of 2008. The Company also announced that it has delivered the world's first 'integrated'3D HDTV in partnership with Arisawa Manufacturing and Hyundai IT. Retail salesof the 46" Hyundai 3D LCD HDTV began on April 11th in electronics retail storesin Japan. Following the delivery of the TriDef embedded 3D image processing solution forthe Hyundai LCD TV, the Company is now actively involved in demonstrations tokey executives at a number of Hollywood film and television studios andproduction companies. The Company has encoded examples of the most recent 3DHollywood movies on Blu-Ray(R) disc. The Blu-Ray disc demonstrates how thestudios can produce easy-to-use, high quality 3D entertainment for the consumertelevision market that will be compatible with the 3D HDTVs based on theCompany's TriDef 3D architecture being manufactured by licensees such as Samsungand Hyundai IT. As the 3D market continues to grow, the Company expects to secure additionalcommercial contracts that may assist the Company in raising additional financeas may be required. 2007 Year End Results The Company anticipates releasing the 2007 Full Year results in late June 2008following the completion of the regulatory closed period that will now beenacted. Notes to Editors About DDD DDD, also known as Dynamic Digital Depth, is transforming the viewing experiencewith applications for 3D displays. Its patented technologies enable 3D viewingwith and without glasses; simple integration of computer graphics applicationswith 3D displays; supply of 3D content through 2D to 3D conversion; and 3Dtransmission over existing networks. DDD is quoted on the London StockExchange's Alternative Investment Market (AIM: DDD). Background • A new category of flat screen LCD and plasma displays are beingdeveloped and marketed by major consumer electronics companies that providestereoscopic 3D images both with and without the need for the viewer to wearglasses. Stereoscopic 3D images appear to have natural in and off-screen depth.3D displays have already been included in flat-panel televisions in the UnitedStates and Japan, mobile phones in Japan and Korea and in desktop PC displaysand notebook computers in North America and Japan. • DDD's solutions provide an important bridge between conventionaltwo-dimensional (2D) software applications and content and the new 3D displays.Normal 2D pictures, video and computer graphics images are manipulated by DDD'spatented software enabling them to be displayed on 3D displays without requiringthe content to be created specially for a 3D display. DDD's solutions alsoenable automatic conversion of virtually any media from 2D to 3D without anypre-processing of the 2D image. • DDD licenses these software applications, marketed under the TriDef(R)and DDD MobileTM brand names, to consumer electronics manufacturers forinclusion with the 3D display products supplied to their end users. DDD alsolicenses its software directly to end users who already own 3D displays andthrough an international sales channel. DDD's customers include SamsungElectronics, Sharp Corporation, Hyundai IT and Arisawa Manufacturing Company. • In February 2008 Samsung and DDD entered into an development andlicense agreement to integrate DDD's TriDef 3D real time 2D to 3D conversionsolution and 3D image processing architecture in a custom 3D image processingchip that will form the basis of Samsung's next generation 3D HDTVs. • In February 2008 Samsung and DDD entered into an agreement to supplyDDD's TriDef 3D Experience software solution as part of Samsung's 3-D accessorypack for their range of 3-D ready plasma and DLP rear projection HDTVs. • In February 2008 DDD delivered the first embedded 3-D HDTV processorfor the Hyundai IT 46" 3-D LCD TV that is based on Arisawa Manufacturing's X-Pol3-D materials. The TriDef Core processor decodes the 3-D television signal beingbroadcast to consumers in Japan on the BS11 TV network as well as convertinghigh definition 2-D content to 3-D automatically. • In September 2007 Samsung launched a range of 3-D Ready DLP(R) rearprojection HDTVs in North America. DDD's TriDef 3D Experience software solutionenables a range of popular entertainment to be enjoyed in 3-D and is availablein various accessory packs including 3-D glasses. The 3-D accessory packs areavailable online from DDD.com and other retail and distribution channels. DDDalso supplies software that allows popular PC games to be played in 3-D on thenew HDTVs. • In July 2007 Samsung released the SCH-B710 'glasses-free' 3D mobiletelephone in South Korea. DDD entered into a development and license agreementwith Samsung Electronics allowing Samsung to include DDD's 3D mobile telephonesoftware solution in Samsung's SCH-B710 3D mobile telephone. The licenseagreement yields a royalty to DDD for each handset manufactured. Samsung renewedits exclusive rights for DDD's real time 2D to 3D conversion capabilities foruse on 3D mobile phones in Korea in October 2006. • In October 2004 DDD signed an agreement with Arisawa ManufacturingCompany Limited of Japan to develop 2D to 3D conversion solutions for consumertelevision. The agreement included a $250,000 development project to deliverTriDef Vision+, a hardware set top box capable of transforming normal 2D DVD andbroadcast signals into 3D in real time. More information is available at www.DDD.com. Trademarks: DLP is a registered trademark of Texas Instruments. TriDef and DDD Mobile aretrademarks of DDD Group plc. All other trademarks are the property of theirrespective owners. This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
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