Haydale Graphene Industries plc

01/14/2020 | Press release | Distributed by Public on 01/14/2020 01:40

Adoption of new EMI share option scheme, Grant of share options, Lapse of 2014 EMI share option scheme and 2017 LTIP PDMR dealings

14 January 2020

Haydale (AIM: HAYD), the global advanced materials group announces that on 13 January 2020, the Company adopted a new EMI share option scheme ('2020 EMI Scheme') and that the Board of the Company ('Board') has also granted options under the 2020 EMI Scheme ('2020 Options') to certain directors of the Company ('Directors') and staff of the Group over an aggregate of 34,100,000 ordinary shares of 2p each in the capital of the Company ('Ordinary Shares') pursuant to the 2020 EMI Scheme Rules. The grant of the 2020 Options to the Directors and certain of the key staff of the Group ('Grant') are each related party transactions as defined in AIM Rule 13.

As part of the adoption of the 2020 EMI Scheme, the Company's two existing share incentive schemes, the 2014 EMI share option scheme adopted by the Company in April 2014 ('2014 EMI Scheme') and the 2017 LTIP adopted by the Company in December 2017 ('2017 LTIP') will lapse.

Background to the 2020 EMI Scheme

Management changes at Haydale over the last 18 months, together with new strategic direction and new hires has meant that the Company's previous share incentive schemes were not relevant for the business today. Accordingly, having consulted with a number of the Company's key shareholders and its advisers, the Company has adopted the 2020 EMI Scheme which will enable the Company to retain, incentivise and reward its staff. The 2020 EMI Scheme has been structured to ensure that value is created for shareholders before any value is delivered to Directors and key staff ('Key Management'). Holders of 2020 Options will only accrue value in the event that the Company's share price materially increases, thereby aligning the interests of the Key Management with those of shareholders, as set out below.

Terms of the 2020 EMI Scheme

All of the Options granted have an exercise price of 2.25p per Ordinary Share (being a 19.7 % premium to the closing mid-market price of the Company's Ordinary Shares on 10 January 2020, the last trading day before the Grant) and can only be exercised between the third and tenth anniversary of Grant ('Exercise Period'). The proportion of the 2020 Options granted that are capable of vesting is dependent on certain performance conditions being met, with such performance being directly linked to the performance of the Company's share price over the period to 30th September 2023 as follows:

% of Grant subject to the Performance Condition Performance Condition
30% For a period of 15 consecutive dealing days, commencing after the date of Grant and ending on or before the 30 September 2021, the closing price of the Ordinary Shares exceeds 4.0p (four pence) per Ordinary Share.
30% For a period of 15 consecutive dealing days, commencing after the date of Grant and ending on or before the 30 September 2022, the closing price of the Ordinary Shares exceeds 8.0p (eight pence) per Ordinary Share.
40% For a period of 15 consecutive dealing days, commencing after the date of Grant and ending on or before the 30 September 2023, the closing price of the Ordinary Shares exceeds 16.0p (sixteen pence) per Ordinary Share.

There are no other vesting criteria. Accordingly, should the Company's closing mid-market share price not reach and remain at, or above, 4.0p for at least 15 consecutive dealing days in the period immediately following the date of Grant and ending on 30th September 2021 ('Minimum Target'), then 30% of the Grant will lapse. Furthermore, should the Company's closing mid-market share price not reach and remain at, or above, 8.0p for at least 15 consecutive dealing days in the period immediately following the date of Grant and ending on 30th September 2022, then a further 30% of the Grant will lapse, and should the Company's closing mid-market share price not reach and remain at, or above, 16.0p for at least 15 consecutive dealing days in the period immediately following the date of Grant and ending on 30th September 2023 ('Maximum Target'), then the balance of 40% of the Grant will lapse. The Minimum Target and the Maximum Target represent premiums of approximately 112% and 851%, respectively, to the closing mid-market price of the Company's Ordinary Shares as at 10 January 2020, being the last trading day before the Grant.

The 2020 Options may lapse in the event of cessation of employment save for certain circumstances, including inter alia, redundancy or retirement in which case, at the Company's sole discretion and, subject to performance criteria being met, the Exercise Period may be accelerated. The Exercise Period may also be accelerated in the event of a change of control of the Company.

The Grant represents approximately 10% of the Company's issued ordinary share capital. Of the 2020 Options granted, 22,500,000 were granted to directors of the Company and its subsidiaries, as follows:

Director's name and employing Group company Number of 2020 Options granted Number of 2020 Options held following Grant Total beneficial holding of Ordinary Shares % of current issued share capital
Keith Broadbent (Haydale Graphene Industries Plc) 12,000,000 12,000,000 500,000 0.15
Mark Chapman (Haydale Graphene Industries Plc) 7,000,000 7,000,000 - -
David Davies (Haydale Ltd) 2,000,000 2,000,000 50,671 0.01
Nicholas Weatherby (Haydale Composite Solutions Ltd) 1,500,000 1,500,000 - -

The Company's Remuneration Committee retains the ability to amend the performance conditions for the 2020 Options and for future grants to ensure that such grants achieve the stated purpose.

Related Party Transactions

The Grants to the Directors and the subsidiary directors of the 2020 Options, as outlined above, are related party transactions for the purposes of Rule 13 of the AIM Rules for Companies. Accordingly, the independent directors of the Company (being David Banks, Graham Eves and Roger Humm) consider, having consulted with the Company's nominated adviser, Arden Partners Plc, that the terms of each of the Grants, as outlined above, are fair and reasonable insofar as Shareholders are concerned.

Following the Grants, the Company's total number of Options outstanding as at the date of this announcement is 34,100,000 representing approximately 10% of the Company's existing issued share capital.

The number of ordinary shares currently in issue is 340,223,848 and it is this number that has been used to calculate the above percentage shareholdings.

The notification set out below is provided in accordance with the requirements of the EU Market Abuse Regulation.

Notification of a Transaction pursuant to Article 19(1) of Regulation (EU) No. 596/2014
1 Details of the person discharging managerial responsibilities/person closely associated
a. Name Keith Broadbent
2 Reason for notification
a. Position/Status Chief Executive Officer of Haydale Graphene Industries Plc
b. Initial notification/ Amendment Initial Notification
3 Details of the issuer, emission allowance market participant, auction platform, auctioneer or auction monitor
a. Name Haydale Graphene Industries Plc
b. LEI 213800KNULBQFF25IE72
4 Details of the transaction(s): section to be repeated for (i) each type of instrument; (ii) each type of transaction; (iii) each date; and (iv) each place where transactions have been conducted
a. Description of the financial instrument, type of instrument

Identification Code

Ordinary Shares of 2p each

GB00BKWQ1135

b. Nature of the transaction Grant of options under the 2020 EMI Scheme with time vesting and share price performance conditions attached
c. Price(s) and volume(s)
Price(s) Volume(s)
£0.0225 12,000,000
d. Aggregated information - Aggregated Volume - Price 12,000,000 options over ordinary shares with an exercise price of £0.0225 each
e. Date of the transaction 2020-01-13
f. Place of the transaction XLON (AIM Market)
Notification of a Transaction pursuant to Article 19(1) of Regulation (EU) No. 596/2014
1 Details of the person discharging managerial responsibilities/person closely associated
a. Name Mark Chapman
2 Reason for notification
a. Position/Status Finance Director of Haydale Graphene Industries Plc
b. Initial notification/ Amendment Initial Notification
3 Details of the issuer, emission allowance market participant, auction platform, auctioneer or auction monitor
a. Name Haydale Graphene Industries Plc
b. LEI 213800KNULBQFF25IE72
4 Details of the transaction(s): section to be repeated for (i) each type of instrument; (ii) each type of transaction; (iii) each date; and (iv) each place where transactions have been conducted
a. Description of the financial instrument, type of instrument

Identification Code

Ordinary Shares of 2p each

GB00BKWQ1135

b. Nature of the transaction Grant of options under the 2020 EMI Scheme with time vesting and share price performance conditions attached
c. Price(s) and volume(s)
Price(s) Volume(s)
£0.0225 7,000,000
d. Aggregated information - Aggregated Volume - Price 7,000,000 options over ordinary shares with an exercise price of £0.0225 each
e. Date of the transaction 2020-01-13
f. Place of the transaction XLON (AIM Market)
Notification of a Transaction pursuant to Article 19(1) of Regulation (EU) No. 596/2014
1 Details of the person discharging managerial responsibilities/person closely associated
a. Name David Davies
2 Reason for notification
a. Position/Status Director of Haydale Ltd, a subsidiary of Haydale Graphene Industries Plc
b. Initial notification/ Amendment Initial Notification
3 Details of the issuer, emission allowance market participant, auction platform, auctioneer or auction monitor
a. Name Haydale Graphene Industries Plc
b. LEI 213800KNULBQFF25IE72
4 Details of the transaction(s): section to be repeated for (i) each type of instrument; (ii) each type of transaction; (iii) each date; and (iv) each place where transactions have been conducted
a. Description of the financial instrument, type of instrument

Identification Code

Ordinary Shares of 2p each

GB00BKWQ1135

b. Nature of the transaction Grant of options under the 2020 EMI Scheme with time vesting and share price performance conditions attached
c. Price(s) and volume(s)
Price(s) Volume(s)
£0.0225 2,000,000
d. Aggregated information - Aggregated Volume - Price 1,600,000 options over ordinary shares with an exercise price of £0.0225 each
e. Date of the transaction 2020-01-13
f. Place of the transaction XLON (AIM Market)
Notification of a Transaction pursuant to Article 19(1) of Regulation (EU) No. 596/2014
1 Details of the person discharging managerial responsibilities/person closely associated
a. Name Nicholas Weatherby
2 Reason for notification
a. Position/Status Director of Haydale Composite Solutions Ltd, a subsidiary of Haydale Graphene Industries Plc
b. Initial notification/ Amendment Initial Notification
3 Details of the issuer, emission allowance market participant, auction platform, auctioneer or auction monitor
a. Name Haydale Graphene Industries Plc
b. LEI 213800KNULBQFF25IE72
4 Details of the transaction(s): section to be repeated for (i) each type of instrument; (ii) each type of transaction; (iii) each date; and (iv) each place where transactions have been conducted
a. Description of the financial instrument, type of instrument

Identification Code

Ordinary Shares of 2p each

GB00BKWQ1135

b. Nature of the transaction Grant of options under the 2020 EMI Scheme with time vesting and share price performance conditions attached
c. Price(s) and volume(s)
Price(s) Volume(s)
£0.0225 1,500,000
d. Aggregated information - Aggregated Volume - Price 1,500,000 options over ordinary shares with an exercise price of £0.0225 each
e. Date of the transaction 2020-01-13
f. Place of the transaction XLON (AIM Market)

For further information:

Haydale Graphene Industries plc
Keith Broadbent, CEO Tel: +44 (0) 1269 842 946
Gemma Smith, Global Head of Marketing www.haydale.com
Arden Partners plc (Nominated Adviser & Broker)
Ruari McGirr / Paul Shackleton / Ben Cryer Tel: +44 (0) 20 7614 5900

Notes to Editors

Haydale is a global technologies and materials group that facilitates the integration of graphene and other nanomaterials into the next generation of commercial technologies and industrial materials. With expertise in graphene, silicon carbide and other nanomaterials, Haydale is able to deliver improvements in electrical, thermal and mechanical properties, as well as toughness. Haydale has granted patents for its technologies in Europe, USA and China and operates from 6 sites in the UK, USA and the Far East.

For more information please visit:www.haydale.com

Twitter: @haydalegraphene

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