Augmentum Fintech : Publication of Circular and Notice of General Meeting

14 June 2021

LEI: 213800KX5ZS1NGAR2J89

NOT FOR RELEASE, DISTRIBUTION OR PUBLICATION, DIRECTLY OR INDIRECTLY, IN WHOLE OR IN PART, IN OR INTO THE UNITED STATES, CANADA, AUSTRALIA, THE REPUBLIC OF SOUTH AFRICA, SINGAPORE, JAPAN OR ANY EEA STATE (OTHER THAN ANY MEMBER STATE OF THE EEA WHERE THE COMPANY'S SECURITIES MAY BE LEGALLY MARKETED) OR ANY OTHER JURISDICTION WHERE TO DO SO WOULD CONSTITUTE A VIOLATION OF THE RELEVANT LAWS OR REGULATIONS OF SUCH JURISDICTION. PLEASE SEE THE SECTION ENTITLED "DISCLAIMER" TOWARDS THE END OF THIS ANNOUNCEMENT.

Augmentum Fintech plc

(the “Company”)

Publication of Circular and Notice of General Meeting

The Company announces that it has published a shareholder circular (the “Circular”) to convene a general meeting to be held on 8 July 2021 at 11.00 a.m. at 25 Southampton Buildings, London, WC2A 1AL (the “General Meeting”) to consider (i) proposed changes to the Company's investment policy, and (ii) to seek Shareholder authority to issue new ordinary shares and/or C shares in connection with a proposed share issuance programme including an initial issue of new ordinary shares.

The Board has utilised all existing authorities granted by Shareholders to allot further Shares and consequently, in order to provide the Company with greater flexibility to invest in the identified pipeline, a General Meeting is being convened to take place on 8 July 2021 at which Shareholders will be asked to authorise the Board to issue and allot up to 150 million New Shares (representing approximately 107 per cent. of the issued Share capital of the Company as at the date of this document) and to disapply pre-emption rights in respect of the New Shares to be issued.

The Board is also proposing changes to the Company’s investment policy (i) to allow the Company a limited ability to invest up to 1 per cent. of the Company’s Net Asset Value in seed stage investments, and (ii) given the growth of the Company since IPO, to reduce the amount of cash as a percentage of Gross Assets that the Company expects to hold for the purpose of making follow-on investments and for working capital purposes at any given time. The changes to the investment policy require the approval of Shareholders and such approval will also be sought at the General Meeting.

In light of the ongoing Covid-19 pandemic and notwithstanding the gradual relaxation of some of the restrictions on public gatherings imposed by the UK Government to combat the spread of the virus, it is likely that the Company will restrict attendance at the meeting to a small number of attendees comprising the required quorum of two Shareholders in person or by proxy and those persons whose attendance is necessary for the conduct of the meeting. Unfortunately, it is likely that all other Shareholders will not be permitted entry to the meeting and all votes will be taken by poll so that all proxy votes are counted. Shareholders are therefore asked not to attempt to attend the meeting in person and are instead asked to submit proxy appointments in advance of the General Meeting, either online or by completing a hard copy Form of Proxy in accordance with the instructions set out in the Circular. Shareholders are strongly recommended to appoint the Chairman of the meeting as their proxy given the restrictions on attendance at the General Meeting.

Shareholders who wish to raise questions in relation to the Proposals may do so by emailing [e-mail]. The Company will publish a representative sample of these questions, together with the Board’s responses, on the Company’s website https://augmentum.vc in advance of the General Meeting. Please note that all questions should be submitted by close of business on 2 July 2021 to ensure that the Company is able to respond to them in advance of the General Meeting.

Copies of the Circular will shortly be available for inspection at the Company’s registered office (25 Southampton Buildings, London WC2A 1AL) and via the Company’s website (https://augmentum.vc). The Circular will also shortly be available via the National Storage Mechanism (https://data.fca.org.uk/#/nsm/nationalstoragemechanism).

This announcement has been released on behalf of the Company by order of the Board. Capitalised terms used in this announcement have the meanings given to them in the Circular published by the Company today.

Enquiries:

Augmentum Fintech Tim Levene, Portfolio Manager Nigel Szembel, Investor Relations	[phone] [phone] [e-mail]
Peel Hunt LLP Liz Yong, Luke Simpson, Huw Jeremy, Tom Pocock (Investment Banking)	[phone]
Nplus1 Singer Advisory LLP Harry Gooden, Robert Peel, James Moat (Investment Banking)	[phone]
Frostrow Capital LLP Paul Griggs, Company Secretary	[phone]

Appendix: Proposed Investment Policy

The proposed investment policy of the Company is included below. Additions are highlighted in bold and underline and deletions are shown in strikethrough.

Investment policy

In order to achieve its investment objective, the Company invests in early or (but not seed) later stage investments in unquoted fintech businesses. The Company intends to realise value through exiting the investments over time.

The Company seeks exposure to early stage businesses which are high growth, with scalable opportunities, and have disruptive technologies in the banking, insurance and wealth and asset management sectors as well as those that provide services to underpin the financial sector and other cross-industry propositions.

Investments are expected to be mainly in the form of equity and equity-related instruments issued by portfolio companies, although investments may be made by way of convertible debt instruments. The Company intends to invest in unquoted companies and will ensure that the Company has suitable investor protection rights where appropriate. The Company may also invest in partnerships, limited liability partnerships and other legal forms of entity. The Company will not invest in publicly traded companies. However, portfolio companies may seek initial public offerings from time to time, in which case the Company may continue to hold such investments without restriction.

The Company may acquire investments directly or by way of holdings in special purpose vehicles or intermediate holding entities (such as the Partnership).

The Management Team has historically taken a board or observer position on investee companies and, where in the best interests of the Company, will do so in relation to future investee companies.

The Company’s portfolio is expected to be diversified across a number of geographical areas predominantly within the UK and wider Europe and the Company will at all times invest and manage the portfolio in a manner consistent with spreading investment risk.

The Management Team will actively manage the portfolio to maximise returns, including helping to scale the team, refining and driving key performance indicators, stimulating growth, and positively influencing future financing and exits.

Investment restrictions

The Company will invest and manage its assets with the object of spreading risk through the following

investment restrictions:

• the value of no single investment (including related investments in group entities or related parties) will represent more than 15 per cent. of Net Asset Value; and
• the aggregate value of seed stage investments will represent no more than 1 per cent. of Net Asset Value; and
• at least 80 per cent. of Net Asset Value will be invested in businesses which are headquartered in or have their main centre of business in the UK or wider Europe.

In addition, the Company will itself not invest more than 15 per cent. of its gross assets in other investment companies or investment trusts which are listed on the Official List.

Each of the restrictions above will be calculated at the time of investment and disregard the effect of the receipt of rights, bonuses, benefits in the nature of capital or by reason of any other action affecting every holder of that investment. The Company will not be required to dispose of any investment or to rebalance the portfolio as a result of a change in the respective valuations of its assets.

Hedging and derivatives

Save for investments made using equity-related instruments as described above, the Company will not employ derivatives of any kind for investment purposes. Derivatives may be used for currency hedging purposes.

Borrowing policy

The Company may, from time to time, use borrowings to manage its working capital requirements but shall not borrow for investment purposes. Borrowings will not exceed 10 per cent. of the Company’s Net Asset Value, calculated at the time of borrowing.

Cash management

The Company may hold cash on deposit and may invest in cash equivalent investments, which may include short-term investments in money market type funds and tradeable debt securities.

There is no restriction on the amount of cash or cash equivalent investments that the Company may hold or where it is held. The Board has agreed prudent cash management guidelines with the AIFM to ensure an appropriate risk / return profile is maintained. Cash and cash equivalents are held with approved counterparties, and in line with prudent cash management guidelines, agreed with the Board, AIFM and Portfolio Manager.

It is expected that the Company will hold between 5 and 15 per cent. of its Gross Assets in cash or cash equivalent investments, for the purpose of making follow-on investments in accordance with the Company’s investment policy and to manage the working capital requirements of the Company.

Changes to the investment policy

No material change will be made to the investment policy without the approval of Shareholders by ordinary resolution. Non-material changes to the investment policy may be approved by the Board. In the event of a breach of the investment policy set out above and the investment and gearing restrictions set out therein, the Management Team shall inform the AIFM and the Board upon becoming aware of the same and if the AIFM and/or the Board considers the breach to be material, notification will be made to a Regulatory Information Service.

Disclaimer

This announcement does not constitute a new prospectus relating to the Company and does not constitute, or form part of, any offer or invitation to sell or issue, or any solicitation of any offer to purchase or subscribe for, any shares in the Company in any jurisdiction nor shall it, or any part of it, or the fact of its distribution, form the basis of, or be relied on in connection with or act as any inducement to enter into, any contract therefor.

Peel Hunt LLP ("Peel Hunt") and Nplus1 Singer Capital Markets Limited (“Nplus1), which are authorised and regulated by the Financial Conduct Authority, are acting for the Company only in connection with the matters described in this announcement and are not acting for or advising any other person, or treating any other person as their client, in relation thereto and will not be responsible for providing the regulatory protection afforded to clients of Peel Hunt and Nplus1 or advice to any other person in relation to the matters contained herein.

The shares of the Company have not been, and will not be, registered under the U.S. Securities Act of 1933 (as amended) (the “Securities Act”) or under the securities laws of any state or other jurisdiction of the United States, and may not be offered or sold into or within the United States, absent registration, except pursuant to an applicable exemption from, or in a transaction that is not subject to, the registration requirements of the Securities Act and in compliance with the securities laws of any relevant state or other jurisdiction of the United States. Moreover, the shares of the Company have not been, nor will they be, registered under the applicable securities laws of India, Australia, Canada, the Republic of South Africa, Japan or any member state of the EEA. Further, the Company is not, and will not be, registered under the US Investment Company Act of 1940, as amended. The shares of the Company may be offered outside of the United States pursuant to the provisions of Regulation S of the Securities Act. Subject to certain exceptions, the shares of the Company may not be offered or sold in India, the United States, Australia, Canada, the Republic of South Africa, Japan or any member state of the EEA (other than to professional investors in certain EEA member states for which marketing approval has been obtained) or to, or for the account or benefit of, any national, resident or citizen of India, the United States, Australia, Canada, the Republic of South Africa, Japan or any member state of the EEA (other than to professional investors in certain EEA member states for which marketing approval has been obtained). The distribution of this announcement, in other jurisdictions may be restricted by law and the persons into whose possession this announcement comes should inform themselves about, and observe, any such restrictions.

None of the Company, Augmentum Fintech Management Limited (the "Portfolio Manager"), Nplus1 or Peel Hunt, or any of their respective affiliates, accepts any responsibility or liability whatsoever for, or makes any representation or warranty, express or implied, as to this announcement, including the truth, accuracy or completeness of the information in this announcement (or whether any information has been omitted from the announcement) or any other information relating to the Company or associated companies, whether written, oral or in a visual or electronic form, and howsoever transmitted or made available or for any loss howsoever arising from any use of the announcement or its contents or otherwise arising in connection therewith. The Company, the Portfolio Manager, Nplus1 and Peel Hunt, and their respective affiliates, accordingly disclaim all and any liability whether arising in tort, contract or otherwise which they might otherwise have in respect of this announcement or its contents or otherwise arising in connection therewith.