TIDMCTAG
RNS Number : 0151S
CloudTag Inc.
15 December 2016
15 December 2016
CloudTag Inc.
("CloudTag" or the "Company")
Update, Exercise of Warrants and Restoration of Trading
CloudTag (CTAG:LN), the company that brings personal monitoring
to the wellbeing, fitness and digital health markets announces a
trading and corporate update further to the notification of 7
December 2016. The update includes information on distribution,
manufacturing, new brand name, corporate reorganisation undertaken
earlier in 2016, working capital and exercise of warrants. In
addition, the Company is issuing a clarificatory statement relating
to the notification dated 9 December 2016 regarding the conversion
of L1 loan notes.
Distribution Agreement
Further to the Company's announcement of 5 December 2016, the
Company announces that on 7 December 2016 it entered into a
distribution agreement with Nemesis Limited ("Nemesis")
("Distribution Agreement"), a UK based company which specialises in
the distribution of wearable and automotive technology accessories.
The Distribution Agreement is intended to complement the
distribution rights granted to Second Chance Limited and
CITIES.
Nemesis is not committed to make any sales under the agreement
and there is no guarantee that the Distribution Agreement will lead
to any sales.
New brand name and product images
The Company plans to announce the brand name under which its
first product will be marketed tomorrow. The Company's website has
a countdown page indicating this. Website users will be able see
images of the product which the Company will be exhibiting at the
CES in January 2017.
Manufacturing
To date, a small number of units of the Company's latest product
have been produced for demonstration and marketing purposes.
Production has also commenced of a modest order to ensure stock
availability for CES at which the Company is exhibiting in January
2017.
Given the importance of CES in demonstrating interest from
retailers in the product and applying a cautious approach to
managing the Company's working capital, the Board has decided to
delay its instruction to commence the manufacture of significant
amounts of stock until firm orders are received from retailers and
distributors. The Company previously announced (most recently on 7
December 2016) that it has received an indicative, non-binding
order from Second Chance for GBP880,000 which was subject to
manufacturing and delivery date being agreed ("Indicative Order").
In view of the Board's cautious approach as outlined above and
understanding that Second Chance wishes to firm up orders from its
own customers before committing to a firm order with CloudTag, the
timing of the fulfilment of the Second Chance Indicative Order will
be aligned with the stock manufacturing timing described above and
so will not now be fulfilled in December.
Corporate reorganisation
On admission to AIM on 14 March 2013 ("Admission"), CloudTag
Inc. had one wholly owned subsidiary being CloudTag Active Limited
("CloudTag Active"), which was incorporated in England and Wales on
26 October 2011. Following Admission all intellectual property was
and continues to be held in the parent company, CloudTag Inc., a
Cayman Island company, with CloudTag Active being the principle UK
operating subsidiary whose focus was on the technical development
of the Company's product. In this respect, the Company and CloudTag
Active were party to a development management agreement and also a
trademark license agreement as set out in the admission
document.
In late 2015, CloudTag undertook an exercise to introduce a
corporate structure appropriate for its expanding operations in
accordance with its tax objectives and its developing technological
approach.
As a result of this exercise, the Group established a UK Branch
office of CloudTag to facilitate the EIS status of the Company and
incorporated a new wholly owned UK subsidiary, CT Technology
Services Limited for the development of the Company's latest
technology and products. CT Technology Services Limited was
incorporated in England and Wales on 2 June 2016 and became a
wholly owned subsidiary of the Company on 22 June 2016. The purpose
of CT Technology Services Limited is to facilitate the ongoing
development of the Company's technology. The operations, employees
and directors of CloudTag Active Limited have, during the course of
this year, been transferred to CT Technology Services Limited.
CloudTag Active is being wound down.
Working capital
On 7 December 2016 the Company stated that with the monies
received from L1 and funds previously raised, working capital was
expected to meet the Company's immediate working capital needs. In
accordance with the announcement dated 28 November 2016, following
the approval of the requisite resolution at the Company's EGM held
on 12 December 2016 the Company expected to issue the first part of
the Tranche 2 Notes (being GBP0.9m before expenses). The first part
of the Tranche 2 Notes has not yet been issued. Upon restoration of
trading the Company intends to give notice of drawdown.
L1 has confirmed to the Company that subject to the restoration
of trading on AIM of the Company's shares and the admission to
trading on AIM of the shares deliverable to L1 pursuant to the
conversion notice dated 6 December 2016, all conditions precedent
required in connection with the next issue of Convertible
Securities have been satisfied.
Exercise of Warrants
The Company announces that it has received notice from Lee
Musgrave and Mark Betteridge, being the owners and directors of
Preciousbluedot Limited ("Preciousbluedot"), to exercise warrants
over 3,433,334 new ordinary shares ("New Ordinary Shares") at an
exercise price of 3.0 pence per New Ordinary Share raising
GBP103,000 for the Company.
On 29 September 2015, the Company announced that it had settled
historic fees in respect of services provided by Preciousbluedot
relating to the development of the Company's app through the
issuance of warrants over 11,433,334 ordinary shares at an exercise
price of 3.0 pence per share (the "Warrants") as compared to the
closing market price of the Company's shares of 2.38 pence on the
day prior to the issue of these Warrants. The Warrants were
transferable, vested immediately and were exercisable at any time
until the tenth anniversary of the date of grant, being 28
September 2025. The Company's annual accounts for the year ended 30
September 2015 (Note 8) state these Warrants were valued at the
value of the services provided, being GBP34,000.
The award of the Warrants was made to the directors of
Preciousbluedot in equal part rather than to Preciousbluedot as
announced. Lee Musgrave, who was awarded 5,716,667 Warrants had
been a director of the Company's subsidiary Cloudtag Active Limited
within twelve months of the date of grant. The transaction was a
related party transaction in accordance with AIM Rule 13 and should
have been disclosed and approved as such at the time of grant.
Application has been made for the admission of the New Ordinary
Shares to trading on AIM which is expected on or around 19 December
2016. The New Ordinary Shares will rank pari passu in all respects
with the Company's existing ordinary shares.
Conversion of GBP1.15m Loan Notes announced on 9 December
2016
The Company announced on 9 December 2016 that L1 Capital Global
Opportunities Master Fund ("L1") had provided notice to convert
GBP1,150,000 of Tranche 1 Notes (nominal value) into 19,166,666 new
ordinary shares ("Notice") ("Conversion"). The Company clarifies
that the Notice relating to the Conversion was dated 6 December
2016 however it was not received by the Company until 7 December
2016. In accordance with the terms of the Tranche 1 Notes, the
exercise price of the warrants issued to L1 on 9 December 2016 as a
result of Conversion had an exercise price of the lower of:
a) 90% of the closing bid price per ordinary share on the day
immediately prior to the date of exercise of such warrants and
b) 9.6875 pence per share being 125% of the closing bid price
per ordinary share on 5th December 2016, being the day immediately
preceding the date of the Notice.
Application has been made for the admission of 19,166,666 new
ordinary shares to trading on AIM and it is now expected that
dealings in these shares will commence on or around 19 December
2016.
Total voting rights
Following the issue of the above mentioned new ordinary shares,
the total number of ordinary shares in issue will be 408,211,752.
This number may be used by shareholders as the denominator for the
calculation by which they will determine if they are required to
notify their interest in, or a change in their interest in, the
share capital of the Company.
Restoration of Trading
Further to the temporary suspension of the Company's shares on 9
December 2016, the Company advises that the suspension will be
lifted at 7.30am on 16 December 2016.
This announcement contains inside information for the purposes
of Article 7 of EU Regulation 596/2014.
Enquiries:
CloudTag Inc. +1 345 949 45 44
Amit Ben-Haim / Tony Reeves contact@cloudtag.com
UK Investor Relations +44 (0) 20 7052 8469
investors@cloudtag.com
Cairn Financial Advisers LLP (Nominated
Adviser)
Tony Rawlinson / Jo Turner +44 (0) 20 7213 0880
This information is provided by RNS
The company news service from the London Stock Exchange
END
MSCBRBDDUXBBGLU
(END) Dow Jones Newswires
December 15, 2016 12:37 ET (17:37 GMT)
Cloudtag (LSE:CTAG)
Graphique Historique de l'Action
De Nov 2024 à Déc 2024
Cloudtag (LSE:CTAG)
Graphique Historique de l'Action
De Déc 2023 à Déc 2024
