2752 - Project Spearmint

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Stewart Europe Limited or for giving advice in relation to the matters referred to in this circular. Application will be made to the London Stock Exchange for the Placing Shares to be admitted to trading on AIM. It is expected that Admission will become effective and that dealings in the Placing Shares will commence on 15January 2007.ThePlacingShareswillbeissuedfreeofexpensesand will,onissue,rank paripassu inall respectswiththe existingOrdinarySharesinissue,includingthe righttoreceivealldividendsanddistributions declared,madeorpaidafter thedateofissue. INDITHERM PLC (Incorporated and registered in England and Wales with registered no. 3587944) Proposed placing of 30,000,000new Ordinary Shares of 1p eachat 10p per share and Notice of Extraordinary General Meeting ThePlacingShareshavenotbeenandwillnotberegisteredundertheUnitedStatesSecuritiesActof1933(as amended)orunderthesecuritieslawsofanystateoftheUnitedStatesorunderanyoftherelevantsecurities lawsofCanada,Australia,Japan,theRepublicofIrelandorSouthAfrica.Accordingly,unless anexception undersuchactorrelevantsecuritieslawisavailable,thePlacingSharesmaynotbeoffered,sold,re-soldor delivered,directlyorindirectly,inorintotheUnitedStates,Canada,Australia,Japan,theRepublicofIrelandor SouthAfrica. Notice of an Extraordinary General Meeting of Inditherm plc to be held at the offices of Collins Stewart, ninth floor, 88 Wood Street, London EC2V 7QRat 10.00 a.m. on 12January 2007 is set out at the end of this document together with a form of proxy for use at the Extraordinary General Meeting. The form of proxy should be completed and returned to the Company 9s registrars, Capita Registrars, at CapitaRegistrars,Proxy Department,POBox25,Beckenham,KentBR34BRin accordance with the instructions printed on it as soon as possible and, in any event, so as to be received no later than 10.00 a.m. on 10January 2007. Completion and return of a form of proxy will not preclude Shareholders from attending and voting in person at the Extraordinary General Meeting should they so wish. CONTENTS Page Definitions 3 Letter from the Chairman of Inditherm 4 Notice of Extraordinary General Meeting 8 EXPECTED TIMETABLE OF EVENTS Latest time for receipt of forms of proxy10.00 a.m. 10January 2007 Extraordinary General Meeting10.00 a.m. 12January 2007 Admission of the Placing Shares to AIM15January 2007 2 DEFINITIONS The following definitions apply throughout this document and in the accompanying form of proxy unless the context requires otherwise: cAdmission dadmission of the Placing Shares to trading on AIM becoming effective in accordance with the AIM Rules; cAIM dAIM, a market regulated by the London Stock Exchange; cAIM Rules dthe rules for AIM companies and their nominated advisers published by the London Stock Exchange governing admission to and the operation of AIM (as amended from time to time); cBoard d or cDirectors dthe directors of Inditherm whose names are set out on page 4 of this document; cCollins Stewart dCollins Stewart Europe Limited; cCompanies Act dthe Companies Act 1985 (as amended); cCompany d or cInditherm dInditherm plc; cCREST dthe United Kingdom paperless share settlement system of which CRESTCo Limited is the Operator (as defined in the Uncertificated Securities Regulations 2001SI 2001 No. 3755); cEGM d or cExtraordinary General Meeting dthe extraordinary general meeting of Inditherm to be held at 10.00 a.m. on 12January 2007, notice of which is set out at the end of this document; cGroup dthe Company and its subsidiaries; cLondon Stock Exchange dLondon Stock Exchange plc; cOption Schemes dthe Company 9s Share Incentive Plan and the Enterprise Management Incentive Scheme; cOrdinary Shares dthe ordinary shares of 1p each in the capital of the Company; cPlacing dthe proposed placing by Collins Stewart of the Placing Shares on behalf of the Company at the Placing Price and on the terms of the Placing Agreement; cPlacing Agreement dthe conditional agreement dated 13December 2006 between Collins Stewart and the Company, a summary of which is set out in paragraph 4of the letter from the Chairman; cPlacing Price d10p per Ordinary Share; cPlacing Shares d30,000,000new Ordinary Shares to be allotted on the terms of the Placing Agreement; cResolutions dthe resolutions to be proposed at the EGM, as set out in the Notice of EGM at the end of this document; cShareholders dholders of Ordinary Shares at the date of this document; cUK d or cthe United Kingdom dthe United Kingdom of Great Britain and Northern Ireland;and cUSFDA dthe USFoodandDrugAdministration. 3 LETTER FROM THE CHAIRMAN OF INDITHERM INDITHERM PLC (Incorporated and registered in England and Wales with registered no. 3587944) Registered office: Inditherm House, Houndhill Park, Bolton Road, Wath-upon-Dearne, Rotherham S63 7LG Directors: Mark S Abrahams, Chairman Richard Harpum, Chief Executive Officer Ian D Smith, Finance Director and Company Secretary John H Markham, Non-executive Director 13December 2006 To Shareholders and, for information only, to holders of options under the Option Schemes Dear Shareholder, Proposed placing of 30,000,000new Ordinary Shares Notice of Extraordinary General Meeting 1.Introduction The Board announced today that Inditherm has agreed, subject to certain conditions, to raise approximately £2.8million, net of expenses, by way of a placing. Further details of the Placingare set out in section4of this document. The necessary authority required for the allotment of Placing Shares pursuant to the Placing will be sought at an Extraordinary General Meeting convened for 10.00 a.m. on 12January 2007. The purpose of this document is to provide you with information on the Placing and to convene the EGM at which your approval will be sought for the Resolutions. 2.Background to and reasons for the Placing As announced earlier today, the Company intends to raise approximately £2.8million (net of expenses) through the Placing. Over the last twoyears, the Company has followed a strategy of focusing on selected markets and undertaking larger projects. This has resulted in a growth inturnoverofapproximately 50 per cent. in the core medical, industrial and construction businessesoftheCompanyduring 2006. It is the Company 9s intention to continue this progress. In addition to the growth in established markets, and following the recent US FDA approval for heated mattresses, the Company recently signed an exclusive US distribution agreement with Smiths Medical ASDInc. ( cSmiths d) asubsidiaryof Smiths Group plc (the cAgreement d). Smiths have a well-established market presence in the US patient warming sector, with a sales team of over 50 specialists, directed at hospitals throughout the US.Under the terms of the Agreement, sales are targeted to reach US$5million in the third year and as a result it is the Directors belief that theAgreementwill accelerate the Company 9s growth and furtherimprove margins. The Directors believe that the Company would benefit from access to additional capital to help it to further accelerate growth and therefore proposes to raise additional funds through the Placing. In order to improve financial stability, to broaden the institutional shareholder base and to minimise transactional costs, the Placing Shares are being offered to a number of existing and new institutional shareholders. The Placing Price represents a discount of approximately 38.5per cent to the closing mid-market price of 16.25p per Ordinary Share as at 12December 2006, the latest practicable date prior to the announcement of the Placing. 4 3.Current Trading and Prospects Over the last two years, the Company has taken action to improve its growth prospects through a more focused market approach and through improvements and extensions to the product range, better execution and improved sales and marketing. During 2006, the Company 9s turnoverhas grown at a rate of approximately 50 per cent. This growth has come from industrial projects for heated tanks and modular pipework heating systems for major food and confectionary companies and from the medical business. The Company is currently working on a number of industrial prospects, some of which it expects to secure during the next six months. This will be assisted by an increasing customer interest in making energy savings, which the Company is able to deliver through its innovative product range. In the construction sector, a successful project in a pre-cast concrete plant, which realised energy and cement cost savings, along with operational benefits, has raised the Company 9s profile. As a result, the number of enquiries and proposals has increased in recent months. The medical business continues to extend the international distributor network and the Agreement,together with the increased proportionof medical sales,will help to accelerate growth and lead to improved overall margins. The Board therefore believes that the Company has significant potential for growth in its medical, industrial and construction businesses. 4.Placing The Company announced today that it was raising approximately £2.8million, net of expenses, through the placing of 30,000,000new Ordinary Shares. The Placing Price represents a discount of approximately 38.5per cent. to the closing mid-market price of 16.25p per Ordinary Share as at 12December 2006, the latest practicable date prior to the announcement of the Placing. The Placing Shares will rank in full for all dividends and otherwise pari passu with the existing Ordinary Shares. It is expected that the Placing Shares will be admitted to trading on AIM on 15January 2007. The Placing is conditional, inter alia , upon: Ï the approval of the Resolutions at the EGM; Ï the Placing Agreement becoming unconditional in all respects and not having been terminated in accordance with its terms;and Ï Admission of the Placing Shares; in each case by no later than 8.00 a.m. on 15January 2007 (or such time and date as the Company and Collins Stewart may agree, being not later than 31January 2007). The Placing is to be effected on behalf of the Company by Collins Stewart on the terms of the Placing Agreement. The Placing Agreement provides for Collins Stewart to use its reasonable endeavours to procure subscribers for the Placing Shares. The above obligations are subject to certain conditions including those listed above. In consideration of their services in connection with the Placing, the Company will pay to Collins Stewart a fee of 3.5 per cent. of the aggregate value, at the Placing Price, of the Placing Shares. The Placing Agreement contains warranties given by the Company with respect to its business and the Group and certain matters connected with the Placing. In addition, the Company has given indemnities to Collins Stewart in connection with the Placing and Collins Stewart 9s performance of services in relation to the Placing. Collins Stewart is entitled to terminate the Placing Agreement in specified circumstances. 5 6.Directors 9 Shareholdings The Directors have agreed to subscribe for an aggregate of £31,500for 315,000of the Placing Shares at the Placing Price. The beneficial and non-beneficial interests of those Directors who have agreed to subscribe in the Placing for Ordinary Shares (not including unexercised options over the Ordinary Shares) on the date of this document and following the Placing are set out below: Current InterestsInterests after Placing Number ofPercentageNumber ofPercentage OrdinaryofIssuedOrdinaryofIssued SharesOrdinarySharesOrdinary ShareShare DirectorCapitalCapital Mark Abrahams151,5460.7301,5460.6 Richard Harpum57,9450.3157,9450.3 Ian Smith4,4440.154,4440.1 John Markham14,3660.129,3660.1 7.Extraordinary General Meeting and action to be taken A notice convening the EGM to be held at the offices of Collins Stewart, ninth floor, 88 Wood Street, London EC2V 7QRat 10.00 a.m. on 12January 2007 is set out at the end of this document. At the EGM, the Resolutions will be proposed. Authority was given to the Directors at the Company 9s Annual General Meeting on Friday 28 April 2006 to allot shares and other relevant securities (as defined in section 80 oftheCompanies Act) up to an aggregate nominal amount of £15,000. This authority expires at the conclusion of the next annual general meeting or, if earlier, 28July 2007. Thestatutorypre-emptionrightsovertheseshareswerealsodisappliedatthe AnnualGeneral Meeting.However, at the Placing Price, an authority to issue shares up to an aggregate nominal amount of £15,000 would not be sufficient to issue 30,000,000new Ordinary Shares required for the Placing. Moreover, whilst the Directors have no present intention to allot any Ordinary Shares pursuant to the authority granted to them at the Company 9s last annual general meeting, the rights described above would provide flexibility for raising additional funds or making acquisitions, in each case, as suitable opportunities arise. Accordingly, the Resolutions proposed are to empower the Directors to allot equity securities for cash with an aggregate nominal value of £300,000(over and above the authority to issue shares up to an aggregate nominal value of £15,000 granted at the Company 9s Annual General Meeting on Friday 28 April 2006) and to do so otherwise than in accordance with the Shareholders 9 statutory pre-emptionrightsset out in the Companies Act, in connection with the Placing. The authority given to the Directors to allot further shares in the capital of the Company requires the prior authorisation of the Shareholders at a general meeting under section 80 oftheCompanies Act. Following the passing of Resolution 1 asanordinaryresolutionthe Directors will have authority to allot up to anadditional 30,000,000new Ordinary Shares representingapproximately 58.7per cent. of the issued ordinary share capital following completion of the Placing. This authority will expire at the conclusion of the next AGM or 30 April 2007 (whichever is the earlier). Following the passing of Resolution 2asaspecial resolutionthe Directors will have authority under section 95 oftheCompanies Act to allotfor cash the Ordinary Shares authorised by Resolution1without being required first to offer such securities to Shareholders in accordance with the statutory pre-emption rightssetoutinsection 89oftheCompaniesAct. This authority will expire at theconclusionofthe nextAGMor30April2007 (whicheveristheearlier). A form of proxy for use by Shareholders in connection with the EGM is attached at the end of this document. Whether or not you propose to attend the EGM in person, you are requested to complete the form of proxy in accordance with the instructions printed on it and to return it to the Company 9s registrars, Capita Registrars, ProxyDepartment, POBox 25, Beckenham, Kent BR3 4BRas soon as possible and in any event so as to arrive no later than 10.00 a.m. on 10January 2007. Completion and return of the form of proxy will not preclude you from attending the EGM and voting in person should you so wish. 6 8. Recommendation The Directors,soadvisedbyCollinsStewart,consider the terms of the Placing to be fair and reasonable insofar as the Shareholders are concerned and in the best interests of the Companyand accordingly recommend that you vote in favour of the Resolutions at the EGM as they havegivenirrevocable undertakingstodoin respect of their own holding of OrdinaryShares(representing 228,301Ordinary Shares, being 1.08per cent. of the current issued ordinary share capital of the Company). Yours faithfully, Mark Abrahams Chairman 7 INDITHERM PLC (Incorporated in England and Wales with registered number3587944) (the cCompany d) NOTICE OF EXTRAORDINARY GENERAL MEETING NOTICE IS HEREBY GIVEN that an Extraordinary General Meeting of the Company will be held at the offices of Collins Stewart Europe Limited, ninth floor, 88 Wood Street, London EC2V 7QRon 12January 2007 at 10.00 a.m. for the purpose of considering and, if thought fit, passing the following Resolutions, of which Resolution No. 1 will be proposed as an ordinary resolution and Resolution No. 2 will be proposed as a special resolution: ORDINARY RESOLUTION 1.THAT (subject to and conditional upon (but effective immediately prior to), the admission of the Placing Shares (as defined in the circular dated 13December 2006 (of which this notice forms part) to trading on AIM and to such admission becoming effective) in addition and without prejudice to the existing authority given at the Company 9s last annual general meeting, the Directors be and they are hereby generally and unconditionally authorised in accordance with section 80 Companies Act 1985 ( cCA 1985 d) to exercise all the powers of the Company to allot relevant securities (within the meaning of the said section 80) up to afurtheradditional aggregate nominal amount of £300,000during the period commencing on the date of the passing of this resolution and expiring on the conclusion of the next AGM or 30 April 2007 (whichever is the earlier)(both dates inclusive), but so that this authority shall allow the Company to make before the expiry of this authority offers or agreements which would or might require relevant securities to be allotted after such expiry and notwithstanding such expiry the Directors may allot relevant securities in pursuance of such offers or agreements; SPECIAL RESOLUTION 2.THAT (subject to and conditional upon the passing of the Ordinary Resolution numbered 1 contained in the notice of which this resolution forms part), in addition and without prejudice to the existing authority given at the Company 9s last annual general meeting, the Directors be and they are hereby empowered, pursuant to section 95 CA 1985, to allot equity securities (as defined in section 94(2)CA 1985) for cash pursuant to the authority given by the said Resolution 1 as if section 89(1) CA 1985 did not apply to any such allotments, provided that this power shall be limited to the allotment of equity securities for the purposes of the placing of 30,000,000new Ordinary Shares of 1p each announced by the Company on 13 December 2006 and shall expire at midnight onthe conclusion of the next AGM or 30 April 2007 (whichever is the earlier), except that the Company may before such expiry make offers or agreements which would or might require equity securities to be allotted after such expiry and notwithstanding such expiry the Directors may allot equity securities in pursuance of such offers or agreements. Dated: 13December 2006 Notes: 1.A member of the Company who is entitled to attend and vote at the meeting convened by this notice is entitled to appoint one or more proxies to attend and,on a poll, vote in his/her place. A proxy need not be a member of the Company. 2.Forms of proxy should be completed and returned in accordance with the notes on the enclosed form of proxy. 3.Completion and return of this form of proxy will not prevent you from attending and voting at the meeting instead of your pro xy, if you so wish. 4.In accordance with Regulation 41 of the Uncertificated Securities Regulations 2001 only those members entered on the Company 9 s register of members not later than 10a.m. on 10January 2007 or, if the meeting is adjourned, shareholders entered on the Company 9s register of member not later than 48 hours before the time fixed for the adjourned meeting shall be entitled to atten d and vote at the meeting. Dated: 13December 2006 Registered office: Inditherm House Houndhill Park Bolton Road By Order of the Board Wath-upon-DearneIan Smith Rotherham S63 7LG Secretary 8

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