TIDMBHRD
RNS Number : 1008W
Be Heard Group PLC
09 November 2017
The headline for the Be Heard Group announcement released on
09.11.17 at 16.35 under RNS No 0979W should read Proposed
Fundraising
The announcement text is unchanged and is reproduced in full
below.
NOT FOR RELEASE OR DISTRIBUTION, DIRECTLY OR INDIRECTLY, IN OR
INTO THE UNITED STATES, CANADA, THE REPUBLIC OF IRELAND, AUSTRALIA,
JAPAN, THE REPUBLIC OF SOUTH AFRICA OR ANY OTHER JURISDICTION WHERE
TO DO SO WOULD BE UNLAWFUL.
THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION FOR IMMEDIATE
RELEASE.
Be Heard Group plc
("Be Heard", the "Company" or the "Group")
Acquisition of The Corner
Proposed Placing to raise a minimum of approximately GBP2.2
million
Proposed issue of Convertible Loan Notes to raise GBP4.0
million
Be Heard announces the proposed acquisition of The Corner
Communications (London) Limited ("The Corner"), an integrated
creative agency based in London, for a maximum consideration of
GBP12 million. The Company also announces its intention to raise
gross proceeds of approximately GBP6.2 million to fund the
Acquisition, through the issue of not less than 78,000,000 new
ordinary shares (the "Placing Shares") at a minimum price of 2.8
pence per share through a cash placing and GBP4.0 million through
the proposed issue of Convertible Loan Notes.
Summary
-- Further progress with strategy of building an integrated end
to end marketing services group mapping the digital customer
journey
-- Business model already generating additional value with 10
clients served by two or more Be Heard companies
-- Proposed acquisition of The Corner (integrated creative
agency) for a maximum consideration of GBP12m
-- Strong strategic rationale: acquisition adds brand, creative,
communications and social marketing skills, and facilitates more
C-suite client relationships
-- Consideration to be funded by a combination of new shares and convertible loan notes
-- Board retains confidence in full year results, underpinned by new business momentum
Acquisition highlights
-- Award-winning integrated creative agency based in London
- Focus on brand and creative strategy, communications planning,
digital design, social marketing, and events and experiential
- Broad multi-sector experience and client base with strong
client relationships across the charity, entertainment, FMCG,
retail sports and travel sectors
- High revenue visibility with 70 per cent. of net revenue retained or contracted
-- Initial consideration of GBP7.95 million with further maximum
deferred earn-out consideration payable of up to GBP4.05
million
Fundraising highlights
-- Placing to raise gross proceeds of not less than
approximately GBP2.2 million at a minimum price of 2.8 pence per
Ordinary Share
-- The Company has also received conditional commitments to
subscribe for GBP4.0 million Convertible Loan Notes
-- The Acquisition, Placing and issue of Convertible Loan Notes are interconditional
-- The net proceeds of the Placing and the issue of the
Convertible Loan Notes will be used to fund the consideration for
the Acquisition
-- The issue of the Placing Shares is conditional upon, amongst
other things, the passing of Resolution 1 at the General Meeting to
be held on 27 November 2017, and the admission of the Placing
Shares to trading on AIM
-- The Placing is being conducted through an accelerated
bookbuild process (the "Bookbuild") which will be launched
immediately following this announcement and will be subject to the
terms and conditions set out in the Appendix (this announcement,
together with the Appendix, the "Announcement")
-- Certain Directors of the Company have indicated their
intention to subscribe for Placing Shares. Further details of the
Placing and any participation by such Directors will be set out in
the announcement to be made on the closing of the Placing which is
expected to be made later today
Current trading
The Board retains its confidence in the Group's full year
results, underpinned by excellent new business performance in the
first half of FY17 continuing into the second half. Across the
Group, 36 new clients have been won since the beginning of year,
including Addison Lee, GSK, MasterCard, Pittsburgh Paint Group and
Pret A Manger, with ten clients now served by two or more Group
companies and the first Group clients won. This supports the
Board's confidence in the Group's pure play strategy and business
model.
N+1 Singer Advisory LLP ("N+1 Singer") and Dowgate Capital
Stockbrokers Limited ("Dowgate") have been appointed as joint
bookrunners (together the "Joint Bookrunners") in respect of the
Placing. N+1 Singer is acting as nominated adviser to the
Company.
The Placing is conditional upon the passing of Resolution 1 to
be held at a General Meeting of the Company. A circular is expected
to be posted on 10 November 2017 (the "Circular") notifying
shareholders of a general meeting for the purpose of considering
the relevant resolutions expected to be convened at the offices of
Lewis Silkin LLP, 5 Chancery Lane, London EC4A 1BL at 10.00 a.m. on
27 November 2017.
This Announcement contains inside information for the purposes
of Article 7 of EU Regulation 596/2014 ("MAR"). In addition, market
soundings (as defined in MAR) were taken in respect of the Placing
with the result that certain persons became aware of inside
information (as defined in MAR), as permitted by MAR. This inside
information is set out in this Announcement. Therefore, those
persons that received inside information in a market sounding are
no longer in possession of such inside information relating to the
Company and its securities.
Enquiries:
Be Heard Group plc +44 20 3828 6269
Peter Scott, Executive
Chairman
Robin Price, Chief Financial
Officer & Chief Operating
Officer
N+1 Singer +44 20 7496 3000
Mark Taylor / Lauren
Kettle
Dowgate +44 20 3903 7715
James Serjeant
FTI Consulting (Financial
PR) +44 20 3727 1000
Jamie Ricketts / Niamh
Fogarty
About Be Heard
Be Heard (AIM: BHRD) is a digital marketing services group
helping clients solve the challenges they face in the connected
world. To achieve this, the Company acquire and connect
exceptionally-talented companies, providing management experience,
access to deeper resources and a strong platform for growth.
The Company's four partner companies are:
agenda21, a digital media and analytics agency, which became a
partner on admission in November 2015 www.agenda21digital.com
MMT, a user experience ("UX"), design and build agency, which
became a partner in May 2016 www.mmtdigital.co.uk
Kameleon, a content marketing agency, which became a partner in
December 2016 www.kameleon.co.uk
Freemavens, a data-driven analytics and insight consultancy,
which became a partner in February 2017 www.freemavens.com
www.beheardgroup.com
@Be_Heard_Group
FURTHER INFORMATION
Details of the Placing
The Company intends to raise not less than approximately GBP2.2
million pursuant to the Placing, although it reserves the right to
increase or reduce the amount being raised based on investor demand
at its absolute discretion. The Bookbuild will open with immediate
effect following this Announcement. The timing of the closing of
the Bookbuild, the number of Placing Shares, pricing and
allocations are at the discretion of the Company and the Joint
Bookrunners.
An announcement will be made on the closing of the Bookbuild
which is expected to be made by 8.00 a.m. tomorrow, 10 November
2017.
The Placing is conditional, amongst other things, upon:
-- the passing of Resolution 1 at the General Meeting;
-- the Placing Agreement becoming or being declared
unconditional in all respects and not having been terminated in
accordance with its terms prior to Admission;
-- the subscription for the Convertible Loan Notes having been completed; and
-- Admission becoming effective by no later than 8.00 a.m. on 29
November 2017 or such later time and/or date (being no later than
8.00 a.m. on 15 December 2017) as N+1 Singer, Dowgate and the
Company may agree.
The Placing Shares will be issued free of all liens, charges and
encumbrances and will, when issued and fully paid, rank pari passu
in all respects with the Existing Ordinary Shares, including the
right to receive all dividends and other distributions declared,
made or paid after the date of their issue.
Shareholders are reminded that the Placing is conditional,
amongst other things, on the passing of Resolution 1 to be proposed
at the General Meeting. Shareholders should be aware that if
Resolution 1 is not approved at the General Meeting, the Placing
will not proceed. The Placing is not underwritten.
Application will be made to the London Stock Exchange for the
admission of the New Ordinary Shares (comprising the Placing Shares
and the Consideration Shares) to trading on AIM. Subject to
Shareholder approval of Resolution 1 at the General Meeting, it is
expected that Admission will occur and that dealings in the New
Ordinary Shares will commence at 8.00 a.m. on 29 November 2017, at
which time it is also expected that the New Ordinary Shares will be
enabled for settlement in CREST. The Enlarged Share Capital of the
Company will be confirmed by way of an announcement prior to
Admission, once the number of Consideration Shares to be issued is
known. Further details of the consideration due in respect of the
Acquisition are set out below at the section headed 'Terms of the
Acquisition'.
Background to and reasons for the Fundraising and the
Acquisition
Strategic overview and recent progress
Be Heard is building a focused digital marketing services group
that offers clients an end to end service across the digital
customer journey.
Consumption and marketing expenditure continue to shift to
digital services, with global advertising expenditure on the
internet set to overtake that on broadcast television this year,
providing a growing opportunity for Be Heard.
The Group's business model is based on acquiring exceptionally
talented digital marketing specialists and connecting them to
deliver better, broader, more holistic solutions for clients.
With four operating subsidiaries and a team of 240 people, Be
Heard has shown strong revenue growth and new business performance,
and is generating significant additional value through
cross-referrals and new Group sales.
Building on the success to date the Group is seeking to
accelerate growth, provide a broader range of services and build
further scale by acquiring an integrated creative agency.
Acquisition
On 9 November 2017, the Company entered into the Acquisition
Agreement with the Vendors, pursuant to which it has conditionally
agreed to acquire the entire issued share capital of The Corner,
conditional upon the Company obtaining Shareholder approval of the
Resolutions to be proposed at the General Meeting.
Business overview
The Corner is an award-winning integrated creative agency based
in London, whose core capabilities include brand and creative
strategy, communications planning, digital design, social
marketing, and events and experiential. The agency has broad
multi-sector experience and received creative awards and
commendations for its work include The Drum Marketing Awards
(Mencap), IPM Awards (Orbis), CIM Awards (Senet Group), PROMAX BDA
Global Agency of the Year (National Geographic Channel) and APG
Creative Strategy (Oasis).
Customers
The Corner has a broad client base with strong client
relationships across the charity, entertainment, FMCG, retail,
sports and travel sectors including Adidas, blu, Fullers, Jigsaw,
L'Oreal, National Accident Helpline, Oasis (Coca-Cola), Perrigo and
Relish Broadband. Recent client wins include Crabtree & Evelyn,
Jackpotjoy, LateRooms.com and Superbreak.
The agency was placed 7(th) in Campaign New Business Rankings
for creative agencies in 2016, making it the highest ranking
independent agency, and strong revenue visibility, with 70 per
cent. of net revenue retained or contracted.
The strength of The Corner's client relationships was reflected
in the Company's due diligence with a top quartile net promoter
score (being a score measuring customer satisfaction and likelihood
of recommending an agency to others) of 8.27 (out of a possible 10)
versus a sector norm for advertising agencies of 6.99.
Financials
Dec-2016 Dec-2015 Dec-2014
(GBP) (GBP) (GBP)
---------- ---------- ----------
Billings 9,315,706 7,369,827 7,770,975
Net Revenue 5,578,085 3,764,694 3,462,192
Operating Profit 613,630 25,541 8,001
Profit Before
Taxation 647,033 25,541 8,001
========== ========== ==========
Fixed Assets 70,409 63,189 70,758
Current Assets 2,167,340 3,223,141 1,708,063
Net Assets 555,230 40,929 22,114
Normalised EBITDA for the year to December 2016 is GBP1.1m as a
result of adjustments to reduce director salaries to market rate,
transaction costs and pension provision.
Key personnel
The Corner was founded in 2012 by Neil Simpson, Neil Hourston
and Tom Ewart.
Neil Simpson, Chief Executive Officer
Neil spent his early career with advertising agencies Ogilvy and
Mather and BBH, before moving client side at Coca-Cola in Atlanta
in 1994, where he led the award winning 'Eat Football, Sleep
Football, Drink Coca-Cola' campaign that ran during Euro'96. He
subsequently spent five years at Adidas in Amsterdam as Global
Advertising Director, and was named 'Global Advertiser of the Year'
at the Clio's in New York in 2000. In 2002, Neil became Global
Brand Director at Vodafone in the UK and in 2007 returned to agency
side as CEO of Publicis London.
Neil Hourston, Chief Strategy Officer
Neil started his career in qualitative research, before moving
into advertising as Chief Strategy Officer at TBWA, during which
time the agency was runner up as Campaign's Agency of The Year
three times running, and Grey London. He has worked with Sony
PlayStation, News International, Nissan, Apple and Muller, and won
both APG and IPA planning awards.
Tom Ewart, Chief Creative Officer
Tom was previously Art Director at AMV BBDO, where he became the
youngest ever board member, and Executive Creative Director of
Publicis London. He has previously been a winner of awards at
Cannes, BIG, BTAA, Clio's and Creative Circle.
Strategic rationale
The Corner provides a number of strategic benefits for the
Group. It adds brand and creative strategy, communications
planning, digital design and social marketing skills to the Group
existing capabilities. Additionally, The Corner will help
facilitate C-suite relationships through its lead strategy /
creative agency status. The nature of these relationships and the
early input into the creative process that The Corner has with its
clients also provides opportunities to cross sell broad range of
services from other Group companies.
Bringing The Corner into the Group will also allow the Group to
provide integrated creative and media solutions to clients, which
is increasingly important to maximise clients' performance and
return on investment in digital marketing.
Finally, in addition to the Group's media planning and buying
capabilities, The Corner will benefit from the Group's analytics
& insight and UX, design & build skills and resources.
Terms of the Acquisition
The Company will acquire 100 per cent. of the issued share
capital of The Corner on the following basis:
a) Initial consideration of GBP7,950,649.69, payable as
GBP5,354,141.44 in cash and by the issue of fully paid Ordinary
Shares in the Company to the value of GBP2,596,508.25 at the mean
average of the middle-market price at closing of the Ordinary
Shares on each day of a 20 dealing day period ending on (and
including) the dealing day which falls two dealing days prior to
the date on which the Acquisition is completed.
b) Deferred consideration of GBP600,000, subject to both net
revenue and EBITDA for 2018 being greater than those for 2016. Any
deferred consideration is due four months following the end of 2018
and is payable 50 per cent. in cash, 50 per cent. by the issue of
fully paid Ordinary Shares in the Company.
c) Subject to both net revenue and EBITDA in 2020 being greater
than GBP7.0m and GBP1.4m respectively, an Earn Out consideration
("EO") calculated at 7.2x the average EBITDA achieved by The Corner
in the years to December 2018, 2019 and 2020, less the total of the
initial consideration and any deferred consideration previously
paid. The maximum payable under the EO is such that when added to
the initial consideration and any deferred consideration does not
exceed GBP12,000,000. Any EO is due four months following the end
of 2020 and is payable 50 per cent. in cash, 50 per cent. by the
issue of fully paid Ordinary Shares in the Company.
Any shares issued under the provisions of the deferred
consideration or EO are to be priced at the higher of (i) the
average share price over the previous 12 months and (ii) the issue
price of the Consideration Shares (to be determined per the
calculation set out in paragraph a) above).
Other than in regard to the initial consideration, the Company
has the option to settle any share-based consideration by the issue
of loan notes.
The Company will additionally pay the vendors of The Corner an
amount of GBP737,489 in cash on completion of the Acquisition,
representing the excess working capital in The Corner as at the
"locked box" date of 31 May 2017.
Current trading and prospects
The Board retains its confidence in the Group's full year
results, underpinned by excellent new business performance in the
first half of FY17 continuing into the second half. At the time of
the interim results, released on 11 September 2017, over 85 per
cent. of forecast revenue for 2017 had been billed or
confirmed.
Across the Group, 36 new clients have been won since the
beginning of year, including Addison Lee, GSK, MasterCard,
Pittsburgh Paint Group and Pret A Manger.
Group companies are now pitching together as Be Heard, and are
benefitting from access to broader thinking, wider skill sets and
increased business opportunities.
A global soft drinks brand and top 10 UK retail brand were the
Group's the first successes under this approach, with significant
additional assignments being won from existing customers, including
Unilever and Vodafone. Ten clients are now served by two or more
Group companies, affirming the Board's confidence in the Group's
business model.
The Group headcount is now 240 people, up 23 per cent. since
December 2016.
Convertible Loan Notes
The principal terms and conditions of the Convertible Loan Notes
are as follows;
a) the principal amount of the Convertible Loan Notes shall be GBP4.0 million;
b) the Convertible Loan Notes shall become redeemable on 29
November 2021, being the fourth anniversary of their issue (the
period from issue to such date the "Initial Term"), and extendable
by two 1-year periods (each an "Extension Period"), upon consent of
both the Noteholders and the Company;
c) the Noteholders may convert the Convertible Loan Notes into
Ordinary Shares at a conversion price of 3.5 pence, in minimum
tranches of GBP50,000 (or a Noteholder's entire holding, if
less);
d) interest on the Convertible Loan Notes shall accrue at 8 per
cent. per annum during the Initial Term and 10 per cent. per annum
during either Extension Period, and be payable to the Noteholders
quarterly in cash;
e) a premium is payable in the event of a redemption as a result
of a change of control, early redemption by the Company
(permissible at any time following the first anniversary of issue
of the Convertible Loan Notes) or in the event of a default; such
premium being 12 per cent. per annum, subject to a maximum of 25
per cent, of the principal amount of the Convertible Loan Notes;
and
f) covenants will be provided in relation to the Convertible
Loan Notes to cover certain financial metrics of the Group,
including EBITDA growth, cumulative cash generation, and debt
levels.
The issue of the Convertible Loan Notes will not proceed unless
the Placing Agreement becomes unconditional in all respects (other
than Admission).
Use of proceeds
The Directors intend that the net proceeds of the Fundraising to
be received by the Company (being approximately GBP5.6 million,
comprising gross proceeds of GBP2.2 million in respect of the
Placing and GBP4.0 million in respect of the issue of the
Convertible Loan Notes, less total expenses of approximately GBP0.6
million) will be used by the Group primarily for the following
purposes:
Cash consideration payable in respect GBP5.4 million
of the Acquisition
Group working capital GBP0.2 million
APPIX - TERMS AND CONDITIONS OF THE PLACING
IMPORTANT INFORMATION FOR INVITED PLACEES ONLY REGARDING THE
PLACING.
THIS ANNOUNCEMENT, INCLUDING THIS APPIX AND THE INFORMATION
CONTAINED HEREIN (TOGETHER THE "ANNOUNCEMENT") IS RESTRICTED AND IS
NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, IN WHOLE OR IN PART,
DIRECTLY OR INDIRECTLY, IN OR INTO OR FROM THE UNITED STATES,
CANADA, THE REPUBLIC OF IRELAND, AUSTRALIA, JAPAN, THE REPUBLIC OF
SOUTH AFRICA OR ANY OTHER JURISDICTION IN WHICH SUCH RELEASE,
PUBLICATION OR DISTRIBUTION WOULD BE UNLAWFUL. THIS ANNOUNCEMENT
HAS NOT BEEN APPROVED BY THE LONDON STOCK EXCHANGE, NOR IS IT INTED
THAT IT WILL BE SO APPROVED.
MEMBERS OF THE PUBLIC ARE NOT ELIGIBLE TO TAKE PART IN THE
PLACING. THIS ANNOUNCEMENT IS FOR INFORMATION PURPOSES ONLY AND IS
DIRECTED ONLY AT: (A) PERSONS IN MEMBER STATES OF THE EUROPEAN
ECONOMIC AREA ("EEA") WHO ARE QUALIFIED INVESTORS AS DEFINED IN
SECTION 86(7) OF THE FINANCIAL SERVICES AND MARKETS ACT 2000
("FSMA"), AS AMED ("QUALIFIED INVESTORS"), BEING PERSONS FALLING
WITHIN THE MEANING OF ARTICLE 2(1)(e) OF DIRECTIVE 2003/71/EC AS
AMED, INCLUDING BY THE 2010 PROSPECTUS DIRECTIVE AMING DIRECTIVE
(DIRECTIVE 2010/73/EC) AND TO THE EXTENT IMPLEMENTED IN THE
RELEVANT MEMBER STATE (THE "PROSPECTUS DIRECTIVE"); AND (B) IN THE
UNITED KINGDOM, QUALIFIED INVESTORS WHO ARE PERSONS WHO (I) HAVE
PROFESSIONAL EXPERIENCE IN MATTERS RELATING TO INVESTMENTS FALLING
WITHIN ARTICLE 19(5) (INVESTMENT PROFESSIONALS) OF THE FSMA
(FINANCIAL PROMOTION) ORDER 2005, AS AMED (THE "ORDER"); (II) ARE
PERSONS FALLING WITHIN ARTICLE 49(2)(A) TO (D) (HIGH NET WORTH
COMPANIES, UNINCORPORATED ASSOCIATIONS, ETC.) OF THE ORDER; OR
(III) ARE PERSONS TO WHOM IT MAY OTHERWISE BE LAWFULLY COMMUNICATED
(ALL SUCH PERSONS TOGETHER BEING REFERRED TO AS "RELEVANT
PERSONS").
THIS ANNOUNCEMENT AND THE INFORMATION IN IT MUST NOT BE ACTED ON
OR RELIED ON BY PERSONS WHO ARE NOT RELEVANT PERSONS. PERSONS
DISTRIBUTING THIS ANNOUNCEMENT MUST SATISFY THEMSELVES THAT IT IS
LAWFUL TO DO SO. ANY INVESTMENT OR INVESTMENT ACTIVITY TO WHICH
THIS ANNOUNCEMENT RELATES IS AVAILABLE ONLY TO RELEVANT PERSONS AND
WILL BE ENGAGED IN ONLY WITH RELEVANT PERSONS. THIS ANNOUNCEMENT
DOES NOT ITSELF CONSTITUTE AN OFFER FOR SALE OR SUBSCRIPTION OF ANY
SECURITIES INTHE COMPANY.
THIS ANNOUNCEMENT IS NOT AN OFFER OF SECURITIES FOR SALE INTO
THE UNITED STATES. THE PLACING SHARES HAVE NOT BEEN AND WILL NOT BE
REGISTERED UNDER THE UNITED STATES SECURITIES ACT 1933, AS AMED
(THE "SECURITIES ACT") OR WITH ANY SECURITIES REGULATORY AUTHORITY
OF ANY STATE OR JURISDICTION OF THE UNITED STATES, AND MAY NOT BE
OFFERED, SOLD OR TRANSFERRED, DIRECTLY OR INDIRECTLY, IN THE UNITED
STATES EXCEPT PURSUANT TO AN EXEMPTION FROM, OR IN A TRANSACTION
NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT
AND IN COMPLIANCE WITH ANY APPLICABLE SECURITIES LAWS OF ANY STATE
OR OTHER JURISDICTION OF THE UNITED STATES. SUBJECT TO CERTAIN
EXCEPTIONS AND AT THE SOLE DISCRETION OF THE COMPANY, THE PLACING
SHARES ARE BEING OFFERED AND SOLD ONLY OUTSIDE THE UNITED STATES IN
"OFFSHORE TRANSACTIONS" WITHIN THE MEANING OF, AND IN ACCORDANCE
WITH, REGULATION S UNDER THE SECURITIES ACT AND OTHERWISE IN
ACCORDANCE WITH APPLICABLE LAWS. NO PUBLIC OFFERING OF THE PLACING
SHARES IS BEING MADE IN THE UNITED STATES, THE UNITED KINGDOM OR
ELSEWHERE. NO MONEY, SECURITIES OR OTHER CONSIDERATION FROM ANY
PERSON INSIDE THE UNITED STATES IS BEING SOLICITED AND, IF SENT IN
RESPONSE TO THE INFORMATION CONTAINED IN THIS ANNOUNCEMENT, WILL
NOT BE ACCEPTED.
EACH PLACEE SHOULD CONSULT WITH ITS ADVISERS AS TO LEGAL, TAX,
BUSINESS AND RELATED ASPECTS OF AN INVESTMENT IN PLACING SHARES.
THE DISTRIBUTION OF THIS ANNOUNCEMENT, ANY PART OF IT OR ANY
INFORMATION CONTAINED IN IT MAY BE RESTRICTED BY LAW IN CERTAIN
JURISDICTIONS, AND ANY PERSON INTO WHOSE POSSESSION THIS
ANNOUNCEMENT, ANY PART OF IT OR ANY INFORMATION CONTAINED IN IT
COMES SHOULD INFORM THEMSELVES ABOUT, AND OBSERVE, SUCH
RESTRICTIONS.
No action has been taken by the Company, N+1 Singer and Dowgate
or any of their respective affiliates, agents, directors, officers
or employees that would permit an offer of the Placing Shares or
possession or distribution of this Announcement or any other
offering or publicity material relating to such Placing Shares in
any jurisdiction where action for that purpose is required.
This Announcement or any part of it does not constitute or form
part of any offer to issue or sell, or the solicitation of an offer
to acquire, purchase or subscribe for, any securities in the United
States (including its territories and possessions, any state of the
United States and the District of Columbia), Canada, the Republic
of Ireland, Australia, Japan, the Republic of South Africa or any
other jurisdiction in which the same would be unlawful. No public
offering of the Placing Shares is being made in any such
jurisdiction.
All offers of the Placing Shares will be made pursuant to an
exemption under the Prospectus Directive from the requirement to
produce a prospectus. In the United Kingdom, this Announcement is
being directed solely at persons in circumstances in which section
21(1) of the FSMA does not apply.
The Placing Shares have not been approved or disapproved by the
US Securities and Exchange Commission, any state securities
commission or other regulatory authority in the United States, nor
have any of the foregoing authorities passed upon or endorsed the
merits of the Fundraising or the accuracy or adequacy of this
Announcement. Any representation to the contrary is a criminal
offence in the United States. The relevant clearances have not
been, nor will they be, obtained from the securities commission of
any province or territory of Canada, no prospectus has been lodged
with, or registered by, the Australian Securities and Investments
Commission or the Japanese Ministry of Finance; the relevant
clearances have not been, and will not be, obtained for the South
Africa Reserve Bank or any other applicable body in the Republic of
South Africa in relation to the Placing Shares and the Placing
Shares have not been, nor will they be, registered under or
offering in compliance with the securities laws of any state,
province or territory of Canada, the Republic of Ireland,
Australia, Japan, or the Republic of South Africa. Accordingly, the
Placing Shares may not (unless an exemption under the relevant
securities laws is applicable) be offered, sold, resold or
delivered, directly or indirectly, in or into Canada, the Republic
of Ireland, Australia, Japan, or the Republic of South Africa or
any other jurisdiction outside the United Kingdom.
Persons (including, without limitation, nominees and trustees)
who have a contractual right or other legal obligations to forward
a copy of this Announcement should seek appropriate advice before
taking any action.
This Announcement should be read in its entirety. In particular,
you should read and understand the information provided in this
"Important Information" section of this Announcement.
By participating in the Placing, each person who is invited to
and who chooses to participate in the Placing (a "Placee") will be
deemed to have read and understood this Announcement in its
entirety, to be participating, making an offer and acquiring
Placing Shares on the terms and conditions contained herein and to
be providing the representations, warranties, indemnities,
acknowledgements and undertakings contained in this Appendix.
In particular, each such Placee represents, warrants,
undertakes, agrees and acknowledges (amongst other things)
that:
1 it is a Relevant Person and undertakes that it will acquire,
hold, manage or dispose of any Placing Shares that are allocated to
it for the purposes of its business;
2 in the case of a Relevant Person in a member state of the EEA
which has implemented the Prospectus Directive (each, a "Relevant
Member State") who acquires any Placing Shares pursuant to the
Placing:
2.1 it is a Qualified Investor within the meaning of Article
2(1)(e) of the Prospectus Directive;
2.2 in the case of any Placing Shares acquired by it as a
financial intermediary, as that term is used in Article 3(2) of the
Prospectus Directive:
2.2.1 the Placing Shares acquired by it in the Placing have not
been acquired on behalf of, nor have they been acquired with a view
to their offer or resale to, persons in any Relevant Member State
other than Qualified Investors or in circumstances in which the
prior consent of N+1 Singer has been given to the offer or resale;
or
2.2.2 where Placing Shares have been acquired by it on behalf of
persons in any member state of the EEA other than Qualified
Investors, the offer of those Placing Shares to it is not treated
under the Prospectus Directive as having been made to such
persons;
3 it is acquiring the Placing Shares for its own account or is
acquiring the Placing Shares for an account with respect to which
it exercises sole investment discretion and has the authority to
make and does make the representations, warranties, indemnities,
acknowledgements, undertakings and agreements contained in this
Announcement;
4 it understands (or if acting for the account of another
person, such person has confirmed that such person understands) the
resale and transfer restrictions set out in this Appendix; and
5 except as otherwise permitted by the Company and subject to
any available exemptions from applicable securities laws, it (and
any account referred to in paragraph 3 above) is outside the United
States acquiring the Placing Shares in offshore transactions as
defined in and in accordance with Regulation S under the Securities
Act.
No prospectus
No prospectus or other offering document has been or will be
submitted to be approved by the Financial Conduct Authority ("FCA")
in relation to the Placing Shares and Placees' commitments will be
made solely on the basis of the information contained in this
Announcement and any information publicly announced through a
Regulatory Information Service (as defined in the AIM Rules for
Companies) by or on behalf of the Company on or prior to the date
of this Announcement (the "Publicly Available Information") and
subject to any further terms set forth in the form of confirmation
to be sent to individual Placees.
Each Placee, by participating in the Placing, agrees that the
content of this Announcement is exclusively the responsibility of
the Company and confirms that it has neither received nor relied on
any information (other than the Publicly Available Information),
representation, warranty or statement made by or on behalf of N+1
Singer, Dowgate and the Company or any other person and none of N+1
Singer, Dowgate and the Company or any other person acting on such
person's behalf nor any of their respective affiliates has or shall
have any liability for any Placee's decision to participate in the
Placing based on any other information, representation, warranty or
statement. Each Placee acknowledges and agrees that it has relied
on its own investigation of the business, financial or other
position of the Company in accepting a participation in the
Placing. Nothing in this paragraph shall exclude the liability of
any person for fraudulent misrepresentation.
Details of the Placing Agreement and the Placing Shares
N+1 Singer and Dowgate has today entered into a placing
agreement (the "Placing Agreement") with the Company under which,
on the terms and subject to the conditions set out in the Placing
Agreement, N+1 Singer and Dowgate, as agents for and on behalf of
the Company, have agreed to use its reasonable endeavours to
procure Placees for the Placing Shares at the Placing Price.
The Placing Shares will, when issued, be subject to the articles
of association of the Company and credited as fully paid and will
rank pari passu in all respects with the Existing Ordinary Shares
in the capital of the Company, including the right to receive all
dividends and other distributions declared, made or paid in respect
of such Ordinary Shares after the date of issue of the Placing
Shares.
Application for admission to trading
Application will be made to the London Stock Exchange for
admission of the Placing Shares to trading on AIM.
It is expected that Admission will take place no later than 8.00
a.m. on 29 November 2017 and that dealings in the Placing Shares on
AIM will commence at the same time.
Principal terms of the Placing
1 N+1 Singer is acting as nominated adviser, placing agent,
joint bookrunner and broker, as agent for and on behalf of the
Company. N+1 Singer is authorised and regulated in the United
Kingdom by the FCA and is acting exclusively for the Company and no
one else in connection with the matters referred to in this
Announcement and will not be responsible to anyone other than the
Company for providing the protections afforded to the customers of
N+1 Singer or for providing advice in relation to the matters
described in this Announcement.
2 Dowgate is acting as placing agent, joint bookrunner and
broker, as agent for and on behalf of the Company. Dowgate is
authorised and regulated in the United Kingdom by the FCA and is
acting exclusively for the Company and no one else in connection
with the matters referred to in this Announcement and will not be
responsible to anyone other than the Company for providing the
protections afforded to the customers of Dowgate or for providing
advice in relation to the matters described in this
Announcement.
3 Participation in the Placing will only be available to persons
who may lawfully be, and are invited by N+1 Singer and Dowgate to
participate. N+1 Singer and Dowgate and any of their respective
affiliates are entitled to participate in the Placing as
principal.
4 The price per Placing Share (the "Issue Price") is a minimum
of 2.8 pence and is payable to N+1 Singer or Dowgate (as agent of
the Company) by all Placees.
5 The Placing Price and the number of Placing Shares will be
agreed between the Company and the Joint Brokers following
completion of the Bookbuild.
6 The completion of the Bookbuild will be determined by N+1
Singer and Dowgate in their absolute discretion and shall then be
announced on a Regulatory Information Service as soon as is
practicable following the completion of the Bookbuild.
7 To bid in the Bookbuild, prospective Placees should
communicate their bid by telephone to their usual sales contact at
N+1 Singer or Dowgate. Each bid should state the number of Placing
Shares which the prospective Placee wishes to subscribe for at the
Placing Price, being a minimum 2.8 pence per Placing Share. Bids
may be scaled down by N+1 Singer and Dowgate on the basis referred
to in paragraph 8 below.
8 The Bookbuild is expected to close no later than 8.00 a.m. on
10 November 2017 but may be closed earlier or later at the
discretion of N+1 Singer and Dowgate. N+1 Singer and Dowgate may,
in agreement with the Company accept bids that are received after
the Bookbuild has closed. The Company reserves the right to reduce
or seek to increase the amount to be raised pursuant to the
Placing, in its absolute discretion. The final allocations of the
Placing Shares (including as to the identity of the Placees and the
number of shares allocated to each Placee at the Placing Price)
shall be determined by N+1 Singer and Dowgate in their absolute
discretion.
9 Each Placee's allocation is determined by N+1 Singer and
Dowgate in its discretion following consultation with the Company
and has been or will be confirmed orally by N+1 Singer or Dowgate
and a form of confirmation will be dispatched as soon as possible
thereafter. That oral confirmation will give rise to an
irrevocable, legally binding commitment by that person (who at that
point becomes a Placee), in favour of N+1 Singer, Dowgate and the
Company, under which it agrees to acquire the number of Placing
Shares allocated to the Placee at the Issue Price and otherwise on
the terms and subject to the conditions set out in this Appendix
and in accordance with the Company's articles of association.
Except with N+1 Singer's or Dowgate's written consent, such
commitment will not be capable of variation or revocation at the
time at which it is submitted.
10 Each Placee's allocation and commitment will be evidenced by
a form of confirmation issued to such Placee by N+1 Singer or
Dowgate. The terms of this Appendix will be deemed incorporated in
that form of confirmation.
11 Each Placee will have an immediate, separate, irrevocable and
binding obligation, owed to N+1 Singer or Dowgate (as agent for the
Company), to pay to it (or as it may direct) in cleared funds an
amount equal to the product of the Issue Price and the number of
Placing Shares such Placee has agreed to acquire and the Company
has agreed to allot and issue to that Placee.
12 Irrespective of the time at which a Placee's allocation(s)
pursuant to the Placing is/are confirmed, settlement for all
Placing Shares to be acquired pursuant to the Placing will be
required to be made at the same time, on the basis explained below
under "Registration and Settlement".
13 All obligations of N+1 Singer band Dowgate under the Placing
will be subject to fulfilment of the conditions referred to below
under "Conditions of the Placing" and to the Placing not being
terminated on the basis referred to below under "Termination of the
Placing".
14 By participating in the Placing, each Placee will agree that
its rights and obligations in respect of the Placing will terminate
only in the circumstances described below and will not be capable
of rescission or termination by the Placee.
15 To the fullest extent permissible by law and applicable FCA
rules, none of (a) N+1 Singer or Dowgate, (b) any of N+1 Singer's
or Dowgate's affiliates, agents, directors, officers, consultants,
(c) to the extent not contained within (a) or (b), any person
connected with N+1 Singer or Dowgate as defined in the FSMA ((b)
and (c) being together "affiliates" and individually an "affiliate"
of N+1 Singer or Dowgate), (d) any person acting on N+1 Singer's or
Dowgate's behalf, shall have any liability (including to the extent
permissible by law, any fiduciary duties) to Placees or to any
other person whether acting on behalf of a Placee or otherwise. In
particular, neither N+1 Singer or Dowgate nor any of their
respective affiliates shall have any liability (including, to the
extent permissible by law, any fiduciary duties) in respect of
their conduct of the Fundraising or of such alternative method of
effecting the Fundraising as N+1 Singer, Dowgate and the Company
may agree.
Registration and Settlement
If Placees are allocated any Placing Shares in the Placing they
will be sent a form of confirmation or electronic confirmation by
N+1 Singer or Dowgate, as soon as it is able which will confirm the
number of Placing Shares allocated to them, the Issue Price and the
aggregate amount owed by them to N+1 Singer or Dowgate.
Each Placee will be deemed to agree that it will do all things
necessary to ensure that delivery and payment is completed as
directed by N+1 Singer or Dowgate in accordance with either the
standing CREST or certificated settlement instructions which they
have in place with N+1 Singer or Dowgate.
It is expected that settlement will take place on or about 29
November 2017 in CREST on a basis in accordance with the
instructions set out in the conditional trade confirmation.
Settlement will be through N+1 Singer against CREST ID: ATMAY,
Designation: PLACINGS or through Dowgate against CREST ID: 842,
Designation: SUSPENSE, as the case may be.
Settlement of transactions in the Placing Shares (ISIN:
GB00BT6SJV45) following Admission will take place within the CREST
system, subject to certain exceptions. Settlement through CREST is
expected to take place on 27 November 2017 unless otherwise
notified by N+1 Singer and/or Dowgate and Admission is expected to
occur no later than 8.00 a.m. on 29 November 2017 unless otherwise
notified by N+1 Singer or Dowgate. If the Placing Shares are to be
delivered to a custodian or settlement agent, Placees should ensure
that the conditional trade confirmation is copied and delivered
immediately to the relevant person within that organisation.
Trade Date: 27 November 2017
Settlement Date: 29 November 2017 (Electronic)
ISIN code for the Placing Shares: GB00BTSJV45
SEDOL code for the Placing Shares: BT6SJV4
Admission and settlement may occur at an earlier date, which if
achievable, will be set out in the Circular. Settlement will be on
a delivery versus payment basis. However, in the event of any
difficulties or delays in the admission of the Placing Shares to
CREST or the use of CREST in relation to the Placing, N+1 Singer,
Dowgate and the Company may agree that the Placing Shares should be
issued in certificated form. N+1 Singer and Dowgate reserve the
right to require settlement for the Placing Shares, and to deliver
the Placing Shares to Placees, by such other means as they deem
necessary if delivery or settlement to Placees is not practicable
within the CREST system or would not be consistent with regulatory
requirements in a Placee's jurisdiction.
Interest is chargeable daily on payments not received from
Placees on the due date in accordance with the arrangements set out
above, in respect of either CREST or certificated deliveries, at
the rate of 2 percentage points above prevailing LIBOR as
determined by N+1 Singer and Dowgate.
Each Placee agrees that if it does not comply with these
obligations, N+1 Singer or Dowgate may sell, charge by way of
security (to any funder of N+1 Singer or Dowgate) or otherwise deal
with any or all of their Placing Shares on their behalf and retain
from the proceeds, for N+1 Singer's or Dowgate's own account and
benefit, an amount equal to the aggregate amount owed by the Placee
plus any interest due and any costs and expenses properly incurred
by N+1 Singer and/or Dowgate as a result of the Placee's failure to
comply with its obligations. The relevant Placee will, however,
remain liable for any shortfall below the amount owed by it and for
any stamp duty or stamp duty reserve tax (together with any
interest or penalties) which may arise upon the sale of their
Placing Shares on their behalf. Legal and / or beneficial title in
and to any Placing Shares shall not pass to the relevant Placee
until such time as it has fully complied with its obligations
hereunder.
If Placing Shares are to be delivered to a custodian or
settlement agent, Placees must ensure that, upon receipt, the
conditional form of confirmation is copied and delivered
immediately to the relevant person within that organisation.
Insofar as Placing Shares are registered in a Placee's name or that
of its nominee or in the name of any person for whom a Placee is
contracting as agent or that of a nominee for such person, such
Placing Shares should, subject as provided below, be so registered
free from any liability to United Kingdom stamp duty or stamp duty
reserve tax. Placees will not be entitled to receive any fee or
commission in connection with the Placing.
Conditions of the Placing
The Placing is conditional upon the Placing Agreement becoming
unconditional and not having been terminated in accordance with its
terms.
The obligations of N+1 Singer and Dowgate under the Placing
Agreement are, and the Placing is, conditional upon, inter
alia:
(a) the passing of the Resolutions (without any amendment which
has not been previously approved by N+1 Singer and Dowgate) at the
General Meeting (or any adjournment thereof);
(b) each of the warranties contained in the Placing Agreement
being and remaining true, accurate and not misleading until
Admission;
(c) the Company having complied in all material respects with
its obligations and having satisfied the conditions under the
Placing Agreement which fall to be performed or satisfied prior to
Admission;
(d) the Placing Agreement not having been terminated by N+1
Singer and Dowgate in accordance with its terms;
(e) the Company procuring that a Circular and Form of Proxy are
sent to each Qualifying Shareholder and a Circular and Form of
Proxy are sent to Overseas Shareholders who have notified an
address in the United Kingdom for the service of documents in
accordance with the articles of association and an Application Form
is sent to each Qualifying non-CREST Shareholder;
(f) the issue of the Convertible Loan Notes having been completed; and
(g) Admission occurring by not later than 8.00 a.m. on 29
November 2017 (or such later date as N+1 Singer, Dowgate and the
Company may agree in writing, in any event being not later than the
Long Stop Date);
(all conditions to the obligations of N+1 Singer and Dowgate
included in the Placing Agreement being together, the
"conditions").
If any of the conditions set out in the Placing Agreement are
not fulfilled or, where permitted, waived in accordance with the
Placing Agreement within the stated time periods (or such later
time and/or date as N+1 Singer, Dowgate and the Company may agree,
provided that the time for satisfaction of the condition set out in
(f) above shall not be extended beyond 8.00 a.m. on 15 December
2017), or the Placing Agreement is terminated in accordance with
its terms, the Fundraising will lapse and the Placee's rights and
obligations shall cease and terminate at such time and each Placee
agrees that no claim can be made by or on behalf of the Placee (or
any person on whose behalf the Placee is acting) in respect
thereof.
By participating in the Placing, each Placee agrees that its
rights and obligations cease and terminate only in the
circumstances described above and under "Termination of the
Fundraising" below and will not be capable of rescission or
termination by it.
Certain conditions may be waived in whole or in part by N+1
Singer and Dowgate, in their absolute discretion by notice in
writing to the Company and N+1 Singer and Dowgate may also agree in
writing with the Company to extend the time for satisfaction of any
condition. Any such extension or waiver will not affect Placees'
commitments as set out in this Announcement.
N+1 Singer and Dowgate may terminate the Placing Agreement in
certain circumstances, details of which are set out below.
Neither N+1 Singer, Dowgate or the Company nor any of their
respective affiliates, agents, directors, officers or employees
shall have any liability to any Placee (or to any other person
whether acting on behalf of a Placee or otherwise) in respect of
any decision any of them may make as to whether or not to waive or
to extend the time and/or date for the satisfaction of any
condition to the Placing nor for any decision any of them may make
as to the satisfaction of any condition or in respect of the
Placing generally and by participating in the Placing each Placee
agrees that any such decision is within the absolute discretion of
N+1 Singer and Dowgate.
Termination of the Fundraising
N+1 Singer and Dowgate may terminate the Placing Agreement, in
accordance with its terms, at any time prior to Admission if, inter
alia:
1 any of the warranties and undertakings in the Placing
Agreement were untrue or inaccurate in any material aspect, or were
misleading when given or deemed given; or
2 the Company fails to comply with its obligations under the
Placing Agreement or the terms of the Fundraising, which N+1 Singer
and Dowgate consider material in the context of the Fundraising;
or
3 any statement contained in the circular is or has become
untrue, inaccurate or misleading in any respect or a matter has
arisen which would constitute a material omission from the
circular; or
4 there has occurred a force majeure event, or any material
adverse change has occurred in the condition, earnings, business
affairs or business prospects of the Company and its subsidiary
undertakings (taken as whole).
If the Placing Agreement is terminated in accordance with its
terms, the rights and obligations of each Placee in respect of the
Placing as described in this Announcement shall cease and terminate
at such time and no claim can be made by any Placee in respect
thereof.
By participating in the Placing, each Placee agrees with N+1
Singer, Dowgate and the Company that the exercise by N+1 Singer,
Dowgate or the Company of any right of termination or any other
right or other discretion under the Placing Agreement shall be
within the absolute discretion of N+1 Singer, Dowgate or the
Company and that neither of N+1 Singer, Dowgate nor the Company
need make any reference to such Placee and that neither N+1 Singer,
Dowgate and the Company, nor any of their respective affiliates,
agents, directors, officers or employees shall have any liability
to such Placee (or to any other person whether acting on behalf of
a Placee or otherwise) whatsoever in connection with any such
exercise.
By participating in the Placing, each Placee agrees that its
rights and obligations terminate only in the circumstances
described above and under the "Conditions of the Fundraising"
section above and will not be capable of rescission or termination
by it after the issue by N+1 Singer and Dowgate of a form of
confirmation confirming each Placee's allocation and commitment in
the Placing.
Representations, warranties and further terms
By participating in the Placing, each Placee (and any person
acting on such Placee's behalf) irrevocably represents, warrants,
acknowledges, undertakes and agrees (for itself and for any such
prospective Placee) that in each case as a fundamental term of such
Placee's application for Placing Shares (save where N+1 Singer and
Dowgate expressly agree in writing to the contrary):
1 it has read and understood this Announcement in its entirety
and that its acquisition of the Placing Shares is subject to and
based upon all the terms, conditions, representations, warranties,
indemnities, acknowledgements, agreements and undertakings and
other information contained herein and that it has not relied on,
and will not rely on, any information given or any representations,
warranties or statements made at any time by any person in
connection with Admission, the Fundraising, the Company, the
Placing Shares or otherwise, other than the information contained
in this Announcement and the Publicly Available Information;
2 it has not received a prospectus or other offering document in
connection with the Fundraising and acknowledges that no prospectus
or other offering document: (a) is required under the Prospectus
Directive; and (b) has been or will be prepared in connection with
the Fundraising;
3 the Ordinary Shares are admitted to trading on AIM, and that
the Company is therefore required to publish certain business and
financial information in accordance with the AIM Rules, which
includes a description of the nature of the Company's business and
the Company's most recent balance sheet and profit and loss account
and that it is able to obtain or access such information without
undue difficulty, and is able to obtain access to such information
or comparable information concerning any other publicly traded
company, without undue difficulty;
4 it has made its own assessment of the Placing Shares and has
relied on its own investigation of the business, financial or other
position of the Company in accepting a participation in the Placing
and neither N+1 Singer, Dowgate and the Company nor any of their
respective affiliates, agents, directors, officers or employees or
any person acting on behalf of any of them has provided, and will
not provide, it with any material regarding the Placing Shares or
the Company or any other person other than the information in this
Announcement, or the Publicly Available Information; nor has it
requested neither of N+1 Singer, Dowgate and the Company, any of
their respective affiliates, agents, directors, officers or
employees or any person acting on behalf of any of them to provide
it with any such information;
5 neither N+1 Singer and Dowgate nor any person acting on behalf
of them or any of their respective affiliates, agents, directors,
officers or employees has or shall have any liability for any
Publicly Available Information, or any representation relating to
the Company, provided that nothing in this paragraph excludes the
liability of any person for fraudulent misrepresentation made by
that person;
6 the only information on which it is entitled to rely on and on
which it has relied in committing to subscribe for the Placing
Shares is contained in the Publicly Available Information, such
information being all that it deems necessary to make an investment
decision in respect of the Placing Shares and it has made its own
assessment of the Company, the Placing Shares and the terms of the
Placing based on Publicly Available Information; (b) neither N+1
Singer, Dowgate and the Company nor any of their respective
affiliates, agents, directors, officers or employees has made any
representation or warranty to it, express or implied, with respect
to the Company, the Placing or the Placing Shares or the accuracy,
completeness or adequacy of the Publicly Available Information; (c)
it has conducted its own investigation of the Company, the Placing
and the Placing Shares, satisfied itself that the information is
still current and relied on that investigation for the purposes of
its decision to participate in the Placing; and (d) has not relied
on any investigation that N+1 Singer or Dowgate or any person
acting on their behalf may have conducted with respect to the
Company, the Placing or the Placing Shares;
7 the content of this Announcement and the Publicly Available
Information has been prepared by and is exclusively the
responsibility of the Company and that neither N+1 Singer and
Dowgate nor any persons acting on behalf of it is responsible for
or has or shall have any liability for any information,
representation, warranty or statement relating to the Company
contained in this Announcement or the Publicly Available
Information nor will they be liable for any Placee's decision to
participate in the Placing based on any information,
representation, warranty or statement contained in this
Announcement, the Publicly Available Information or otherwise.
Nothing in this Appendix shall exclude any liability of any person
for fraudulent misrepresentation;
8 the Placing Shares have not been registered or otherwise
qualified, and will not be registered or otherwise qualified, for
offer and sale nor will a prospectus be cleared or approved in
respect of any of the Placing Shares under the securities laws of
the United States, or any state or other jurisdiction of the United
States, Canada, the Republic of Ireland, Australia, Japan, or the
Republic of South Africa and, subject to certain exceptions, may
not be offered, sold, taken up, renounced or delivered or
transferred, directly or indirectly, within the United States,
Canada, the Republic of Ireland, Australia, Japan, or the Republic
of South Africa or in any country or jurisdiction where any such
action for that purpose is required;
9 it and/or each person on whose behalf it is participating:
9.1 is entitled to acquire Placing Shares pursuant to the
Placing under the laws and regulations of all relevant
jurisdictions;
9.2 has fully observed such laws and regulations;
9.3 has capacity and authority and is entitled to enter into and
perform its obligations as an acquirer of Placing Shares and will
honour such obligations; and
9.4 has obtained all necessary consents and authorities
(including, without limitation, in the case of a person acting on
behalf of a Placee, all necessary consents and authorities to agree
to the terms set out or referred to in this Appendix) under those
laws or otherwise and complied with all necessary formalities to
enable it to enter into the transactions contemplated hereby and to
perform its obligations in relation thereto and, in particular, if
it is a pension fund or investment company it is aware of and
acknowledges that it is required to comply with all applicable laws
and regulations with respect to its subscription for Placing
Shares;
10 it is not, and any person who it is acting on behalf of is
not, and at the time the Placing Shares are subscribed will not be,
a resident of, or with an address in, or subject to the laws of,
the United States, Canada, the Republic of Ireland, Australia,
Japan, or the Republic of South Africa, and it acknowledges and
agrees that the Placing Shares have not been and will not be
registered or otherwise qualified under the securities legislation
of the United States, Canada, the Republic of Ireland, Australia,
Japan, or the Republic of South Africa and may not be offered,
sold, or acquired, directly or indirectly, within those
jurisdictions;
11 the Placing Shares have not been, and will not be, registered
under the Securities Act and may not be offered, sold or resold in
or into or from the United States except pursuant to an effective
registration under the Securities Act, or pursuant to an exemption
from, or in a transaction not subject to, the registration
requirements of the Securities Act and in accordance with
applicable state securities laws; and no representation is being
made as to the availability of any exemption under the Securities
Act for the reoffer, resale, pledge or transfer of the Placing
Shares;
12 it and the beneficial owner of the Placing Shares is, and at
the time the Placing Shares are acquired will be, outside the
United States and acquiring the Placing Shares in an "offshore
transaction" as defined in, and in accordance with, Regulation S
under the Securities Act;
13 it (and any account for which it is purchasing) is not
acquiring the Placing Shares with a view to any offer, sale or
distribution thereof within the meaning of the Securities Act;
14 it will not distribute, forward, transfer or otherwise
transmit this Announcement or any part of it, or any other
presentational or other materials concerning the Fundraising in or
into or from the United States (including electronic copies
thereof) to any person, and it has not distributed, forwarded,
transferred or otherwise transmitted any such materials to any
person;
15 neither N+1 Singer, its respective affiliates, agents,
directors, officers or employees nor any person acting on behalf of
any of them is making any recommendations to it, advising it
regarding the suitability of any transactions it may enter into in
connection with the Fundraising and that participation in the
Fundraising is on the basis that it is not and will not be a client
of N+1 Singer and N+1 Singer has no duties or responsibilities to
it for providing the protections afforded to its clients or for
providing advice in relation to the Fundraising nor in respect of
any representations, warranties, undertakings or indemnities
contained in the Placing Agreement nor for the exercise or
performance of any of its rights and obligations thereunder
including any rights to waive or vary any conditions or exercise
any termination right;
16 neither Dowgate, its respective affiliates, agents,
directors, officers or employees nor any person acting on behalf of
any of them is making any recommendations to it, advising it
regarding the suitability of any transactions it may enter into in
connection with the Fundraising and that participation in the
Fundraising is on the basis that it is not and will not be a client
of Dowgate and Dowgate has no duties or responsibilities to it for
providing the protections afforded to its clients or for providing
advice in relation to the Fundraising nor in respect of any
representations, warranties, undertakings or indemnities contained
in the Placing Agreement nor for the exercise or performance of any
of its rights and obligations thereunder including any rights to
waive or vary any conditions or exercise any termination right;
17 it has the funds available to pay for the Placing Shares for
which it has agreed to subscribe and acknowledges and agrees that
it will make payment to N+1 Singer or Dowgate for the Placing
Shares allocated to it in accordance with the terms and conditions
of this Announcement on the due times and dates set out in this
Announcement, failing which the relevant Placing Shares may be
placed with others on such terms as N+1 Singer or Dowgate may, in
its absolute discretion determine without liability to the Placee
and it will remain liable for any shortfall below the net proceeds
of such sale and the placing proceeds of such Placing Shares and
may be required to bear any stamp duty or stamp duty reserve tax
(together with any interest or penalties due pursuant to the terms
set out or referred to in this Announcement) which may arise upon
the sale of such Placee's Placing Shares on its behalf;
18 no action has been or will be taken by any of N+1 Singer,
Dowgate and the Company or any person acting on their behalf that
would, or is intended to, permit a public offer of the Placing
Shares in the United States or in any country or jurisdiction where
any such action for that purpose is required;
19 the person who it specifies for registration as holder of the
Placing Shares will be: (a) the Placee; or (b) a nominee of the
Placee, as the case may be. Neither N+1 Singer, Dowgate nor the
Company will be responsible for any liability to stamp duty or
stamp duty reserve tax resulting from a failure to observe this
requirement. Each Placee and any person acting on behalf of such
Placee agrees to acquire Placing Shares pursuant to the Fundraising
and agrees to pay the Company, N+1 Singer and Dowgate in respect of
the same (including any interest or penalties) on the basis that
the Placing Shares will be allotted to a CREST stock account of N+1
Singer or Dowgate or transferred to a CREST stock account of N+1
Singer or Dowgate who will hold them as nominee on behalf of the
Placee until settlement in accordance with its standing settlement
instructions with it;
20 it is acting as principal only in respect of the Placing or,
if it is acting for any other person, (a) it is duly authorised to
do so and has full power to make the acknowledgments,
representations and agreements herein on behalf of each such person
and (b) it is and will remain liable to N+1 Singer, Dowgate or the
Company for the performance of all its obligations as a Placee in
respect of the Placing (regardless of the fact that it is acting
for another person);
21 the allocation, allotment, issue and delivery to it, or the
person specified by it for registration as holder, of Placing
Shares will not give rise to a stamp duty or stamp duty reserve tax
liability under (or at a rate determined under) any of sections 67,
70, 93 or 96 of the Finance Act 1986 (depository receipts and
clearance services) and that it is not participating in the Placing
as nominee or agent for any person or persons to whom the
allocation, allotment, issue or delivery of Placing Shares would
give rise to such a liability;
22 it and any person acting on its behalf (if within the United
Kingdom) falls within Article 19(5) and/or 49(2) of the Order and
undertakes that it will acquire, hold, manage and (if applicable)
dispose of any Placing Shares that are allocated to it for the
purposes of its business only;
23 it will not make an offer to the public of the Placing Shares
and it has not offered or sold and will not offer or sell any
Placing Shares to persons in the United Kingdom or elsewhere in the
EEA prior to the expiry of a period of six months from Admission
except to persons whose ordinary activities involve them in
acquiring, holding, managing or disposing of investments (as
principal or agent) for the purposes of their business or otherwise
in circumstances which have not resulted and which will not result
in an offer to the public in the United Kingdom within the meaning
of section 85(1) of the FSMA or an offer to the public in any other
member state of the EEA within the meaning of the Prospectus
Directive;
24 it is a person of a kind described in: (a) Article 19(5)
(Investment Professionals) and/or 49(2) (High net worth companies
etc.) of the FSMA (Financial Promotion) Order 2005, as amended,
and/or an authorised person as defined in section 31 of FSMA; and
(b) section 86(7) of FSMA ("Qualified Investor"), being a person
falling within Article 2.1(e) the Prospectus Directive. For such
purposes, it undertakes that it will acquire, hold, manage and (if
applicable) dispose of any Placing Shares that are allocated to it
for the purposes of its business only;
25 it has only communicated or caused to be communicated and it
will only communicate or cause to be communicated any invitation or
inducement to engage in investment activity (within the meaning of
section 21 of the FSMA) relating to Placing Shares in circumstances
in which section 21(1) of the FSMA does not require approval of the
communication by an authorised person and it acknowledges that this
Announcement is not being issued by N+1 Singer as an authorised
person under Section 21 of FSMA and therefore is not subject to the
same controls applicable to a financial promotion made by an
authorised person;
26 it has complied and it will comply with all applicable laws
with respect to anything done by it or on its behalf in relation to
the Placing Shares (including all relevant provisions of the FSMA
in respect of anything done in, from or otherwise involving the
United Kingdom);
27 if it is a financial intermediary, as that term is used in
Article 3(2) of the Prospectus Directive (including any relevant
implementing measure in any member state), the Placing Shares
acquired by it in the Placing will not be acquired on a
non-discretionary basis on behalf of, nor will they be acquired
with a view to their offer or resale to, persons in a member state
of the EEA which has implemented the Prospectus Directive other
than Qualified Investors, or in circumstances in which the express
prior written consent of N+1 Singer has been given to the offer or
resale;
28 it has neither received nor relied on any confidential price
sensitive information about the Company in accepting this
invitation to participate in the Placing;
29 neither N+1 Singer or Dowgate nor any of their respective
affiliates, agents, directors, officers or employees or any person
acting on behalf of any of them has or shall have any liability for
any information, representation or statement contained in this
Announcement or for any information previously published by or on
behalf of the Company or any other written or oral information made
available to or publicly available or filed information or any
representation, warranty or undertaking relating to the Company,
and will not be liable for its decision to participate in the
Placing based on any information, representation, warranty or
statement contained in this Announcement or elsewhere, provided
that nothing in this paragraph shall exclude any liability of any
person for fraud;
30 N+1 Singer or Dowgate and each of their affiliates, each
acting as an investor for its or their own account(s), may bid or
subscribe for and/or purchase Placing Shares and, in that capacity,
may retain, purchase, offer to sell or otherwise deal for its or
their own account(s) in the Placing Shares, any other securities of
the Company or other related investments in connection with the
Placing or otherwise. Accordingly, references in this Announcement
to the Placing Shares being offered, subscribed, acquired or
otherwise dealt with should be read as including any offer to, or
subscription, acquisition or dealing by N+1 Singer or Dowgate
and/or any of their respective affiliates, acting as an investor
for its or their own account(s). Neither N+1 Singer, Dowgate nor
the Company intend to disclose the extent of any such investment or
transaction otherwise than in accordance with any legal or
regulatory obligation to do so;
31 it has not offered or sold and will not offer or sell any
Placing Shares to persons in the EEA prior to the expiry of a
period of six months from Admission except to persons whose
ordinary activities involve them in acquiring, holding, managing or
disposing of investments (as principal or agent) for the purpose of
their business or otherwise in circumstances which have not
resulted and which will not result in an offer to the public in any
member state of the EEA within the meaning of the Prospectus
Directive;
32 it has complied with its obligations in connection with money
laundering and terrorist financing under the Proceeds of Crime Act
2002, the Terrorism Act 2000, the Terrorism Act 2006 and the Money
Laundering Regulations 2007 (together, the "Regulations") and, if
making payment on behalf of a third party, that satisfactory
evidence has been obtained and recorded by it to verify the
identity of the third party as required by the Regulations;
33 it is aware of the obligations regarding insider dealing in
the Criminal Justice Act 1993, FSMA, the EU Market Abuse Regulation
No. 596 of 2014 and the Proceeds of Crime Act 2002 and confirms
that it has and will continue to comply with those obligations;
34 in order to ensure compliance with the Money Laundering
Regulations 2007, N+1 Singer and/or Dowgate (for itself and as
agent on behalf of the Company) or the Company's registrars may, in
their absolute discretion, require verification of its identity.
Pending the provision to N+1 Singer and /or Dowgate or the
Company's registrars, as applicable, of evidence of identity,
definitive certificates in respect of the Placing Shares may be
retained at N+1 Singer's or Dowgate's absolute discretion or, where
appropriate, delivery of the Placing Shares to it in uncertificated
form may be delayed at N+1 Singer's, Dowgate's or the Company's
registrars', as the case may be, absolute discretion. If within a
reasonable time after a request for verification of identity N+1
Singer's and or Dowgate's (for itself and as agent on behalf of the
Company) or the Company's registrars have not received evidence
satisfactory to them, N+1 Singer, Dowgate and/or the Company may,
at its absolute discretion, terminate its commitment in respect of
the Placing, in which event the monies payable on acceptance of
allotment will, if already paid, be returned without interest to
the account of the drawee's bank from which they were originally
debited;
35 acknowledges that its commitment to acquire Placing Shares on
the terms set out in this Announcement and in the form of
confirmation will continue notwithstanding any amendment that may
in future be made to the terms and conditions of the Placing and
that Placees will have no right to be consulted or require that
their consent be obtained with respect to N+1 Singer, Dowgate and
the Company's conduct of the Placing;
36 it has knowledge and experience in financial, business and
international investment matters as is required to evaluate the
merits and risks of subscribing for the Placing Shares. It further
acknowledges that it is experienced in investing in securities of
this nature and is aware that it may be required to bear, and is
able to bear, the economic risk of, and is able to sustain, a
complete loss in connection with the Fundraising. It has relied
upon its own examination and due diligence of the Company and its
affiliates taken as a whole, and the terms of the Fundraising,
including the merits and risks involved;
37 it irrevocably appoints any duly authorised officer of N+1
Singer or Dowgate as its agent for the purpose of executing and
delivering to the Company and/or its registrars any documents on
its behalf necessary to enable it to be registered as the holder of
any of the Placing Shares for which it agrees to subscribe or
purchase upon the terms of this Announcement;
38 N+1 Singer, Dowgate and the Company and others (including
each of their respective affiliates, agents, directors, officers or
employees) will rely upon the truth and accuracy of the foregoing
representations, warranties, acknowledgements and agreements, which
are given to N+1 Singer or Dowgate, on their own behalf and on
behalf of the Company and are irrevocable;
39 if it is acquiring the Placing Shares as a fiduciary or agent
for one or more investor accounts, it has full power and authority
to make, and does make, the foregoing representations, warranties,
acknowledgements, agreements and undertakings on behalf of each
such accounts;
40 time is of the essence as regards its obligations under this Appendix;
41 any document that is to be sent to it in connection with the
Fundraising will be sent at its risk and may be sent to it at any
address provided by it to N+1 Singer or Dowgate;
42 the Placing Shares will be issued subject to the terms and conditions of this Appendix; and
43 these terms and conditions in this Appendix and all documents
into which this Appendix is incorporated by reference or otherwise
validly forms a part and/or any agreements entered into pursuant to
these terms and conditions and all agreements to acquire shares
pursuant to the Placing will be governed by and construed in
accordance with English law and it submits to the exclusive
jurisdiction of the English courts in relation to any claim,
dispute or matter arising out of any such contract, except that
enforcement proceedings in respect of the obligation to make
payment for the Placing Shares (together with any interest
chargeable thereon) may be taken by the Company or N+1 Singer or
Dowgate in any jurisdiction in which the relevant Placee is
incorporated or in which any of its securities have a quotation on
a recognised stock exchange.
By participating in the Placing, each Placee (and any person
acting on such Placee's behalf) agrees to indemnify and hold the
Company, Dowgate and N+1 Singer and each of their respective
affiliates, agents, directors, officers and employees harmless from
any and all costs, claims, liabilities and expenses (including
legal fees and expenses) arising out of or in connection with any
breach of the representations, warranties, acknowledgements,
agreements and undertakings given by the Placee (and any person
acting on such Placee's behalf) in this Appendix or incurred by N+1
Singer, Dowgate or the Company or each of their respective
affiliates, agents, directors, officers or employees arising from
the performance of the Placee's obligations as set out in this
Announcement, and further agrees that the provisions of this
Appendix shall survive after the completion of the Placing.
The agreement to allot and issue Placing Shares to Placees (or
the persons for whom Placees are contracting as agent) free of
stamp duty and stamp duty reserve tax in the United Kingdom relates
only to their allotment and issue to Placees, or such persons as
they nominate as their agents, direct by the Company. Such
agreement assumes that the Placing Shares are not being acquired in
connection with arrangements to issue depositary receipts or to
transfer the Placing Shares into a clearance service. If there are
any such arrangements, or the settlement related to any other
dealings in the Placing Shares, stamp duty or stamp duty reserve
tax may be payable. In that event, the Placee agrees that it shall
be responsible for such stamp duty or stamp duty reserve tax and
neither N+1 Singer, Dowgate nor the Company shall be responsible
for such stamp duty or stamp duty reserve tax. If this is the case,
each Placee should seek its own advice and they should notify N+1
Singer or Dowgate accordingly. In addition, Placees should note
that they will be liable for any capital duty, stamp duty and all
other stamp, issue, securities, transfer, registration, documentary
or other duties or taxes (including any interest, fines or
penalties relating thereto) payable outside the United Kingdom by
them or any other person on the acquisition by them of any Placing
Shares or the agreement by them to acquire any Placing Shares and
each Placee, or the Placee's nominee, in respect of whom (or in
respect of the person for whom it is participating in the Placing
as an agent or nominee) the allocation, allotment, issue or
delivery of Placing Shares has given rise to such non-United
Kingdom stamp, registration, documentary, transfer or similar taxes
or duties undertakes to pay such taxes and duties, including any
interest and penalties (if applicable), forthwith and to indemnify
on an after-tax basis and to hold harmless the Company, Dowgate and
N+1 Singer in the event that either the Company, Dowgate and/or N+1
Singer has incurred any such liability to such taxes or duties.
The representations, warranties, acknowledgements and
undertakings contained in this Appendix are given to N+1 Singer and
Dowgate for itself and on behalf of the Company and are
irrevocable.
Each Placee and any person acting on behalf of the Placee
acknowledges that N+1 Singer and Dowgate does not owe any fiduciary
or other duties to any Placee in respect of any representations,
warranties, undertakings, acknowledgements, agreements or
indemnities in the Placing Agreement.
Each Placee and any person acting on behalf of the Placee
acknowledges and agrees that N+1 Singer and/or Dowgate may (at
their absolute discretion) satisfy their obligations to procure
Placees by itself agreeing to become a Placee in respect of some or
all of the Placing Shares or by nominating any connected or
associated person to do so.
When a Placee or any person acting on behalf of the Placee is
dealing with N+1 Singer or Dowgate, any money held in an account
with N+1 Singer or Dowgate on behalf of the Placee and/or any
person acting on behalf of the Placee will not be treated as client
money within the meaning of the relevant rules and regulations of
the FCA made under FSMA. Each Placee acknowledges that the money
will not be subject to the protections conferred by the client
money rules: as a consequence this money will not be segregated
from N+1 Singer's or Dowgate's money (as applicable) in accordance
with the client money rules and will be held by it under a banking
relationship and not as trustee.
References to time in this Announcement are to London time,
unless otherwise stated.
All times and dates in this Announcement may be subject to
amendment.
No statement in this Announcement is intended to be a profit
forecast, and no statement in this Announcement should be
interpreted to mean that earnings per share of the Company for the
current or future financial years would necessarily match or exceed
the historical published earnings per share of the Company.
The price of shares and any income expected from them may go
down as well as up and investors may not get back the full amount
invested upon disposal of the shares. Past performance is no guide
to future performance, and persons needing advice should consult an
independent financial adviser.
The Placing Shares to be issued or sold pursuant to the Placing
will not be admitted to trading on any stock exchange other than
the London Stock Exchange.
Neither the content of the Company's website nor any website
accessible by hyperlinks on the Company's website is incorporated
in, or forms part of, this Announcement.
DEFINITIONS
The following definitions apply throughout this document unless
the context otherwise requires:
"Act" the Companies Act 2006 (as amended)
"Acquisition" the conditional acquisition of entire
issued share capital of The Corner Communications
(London) Limited by the Company pursuant
to the terms of the Acquisition Agreement
"Acquisition the conditional agreement dated 9 November
Agreement" 2017 and entered into between (1) the
Company and (2) the Vendors pursuant
to which the Company will acquire the
entire issued share capital of The Corner
"Admission" admission of the New Ordinary Shares
to trading on AIM becoming effective
in accordance with Rule 6 of the AIM
Rules
"AIM" the AIM Market operated by the London
Stock Exchange
"AIM Rules" the AIM Rules for Companies published
by the London Stock Exchange from time
to time
"The Corner" The Corner Communications (London) Limited
"certificated an ordinary share recorded on a company's
form" or "in share register as being held in certificated
certificated form (namely, not in CREST)
form"
"Company" Be Heard Group plc, a company incorporated
and registered in England and Wales
under the Companies Act 2006 with registered
number 09223440
"Consideration the new Ordinary Shares to be issued
Shares" pursuant to the terms of the Acquisition
Agreement
"Convertible the convertible loan notes constituting
Loan Notes" up to GBP4.0 million unsecured convertible
loan notes, further details of which
are set out in this announcement
"CREST" the relevant system (as defined in the
CREST Regulations) in respect of which
Euroclear is the operator (as defined
in those regulations)
"Dealing Day" a day on which the London Stock Exchange
is open for business in London
"Directors" the directors of the Company
or "Board"
"Dowgate" Dowgate Capital Stockbrokers Limited,
the Company's joint broker
"Enlarged Share the issued share capital of the Company
Capital" immediately following Admission
"Existing Ordinary the 813,049,493 Ordinary Shares in issue
Shares" at the date of this announcement, all
of which are admitted to trading on
AIM
"Fundraising" the Placing and the issue of the Convertible
Loan Notes
"General Meeting" the general meeting of the Company to
be held on 27 November 2017, notice
of which will be sent to Shareholders
"Group" the Company, its subsidiaries and its
subsidiary undertakings
"Joint Brokers" N+1 Singer and Dowgate
"London Stock London Stock Exchange plc
Exchange"
"MAR" Article 7 of EU Regulation 596/2014
"N+1 Singer" Nplus1 Singer Advisory LLP, the Company's
nominated adviser and joint broker
"New Ordinary the Consideration Shares and the Placing
Shares" Shares
"Noteholders" holders of the Convertible Loan Notes
"Options" options (or other convertible securities)
over Ordinary Shares held by the Directors
and certain employees of the Group
"Ordinary Shares" ordinary shares of 1 penny each in the
capital of the Company
"Placing" the conditional placing of the Placing
Shares by the Joint Brokers, as agents
on behalf of the Company, pursuant to
the Placing Agreement
"Placing Agreement" the conditional agreement dated 9 November
2017 and made between (1) the Company,
(2) N+1 Singer and (3) Dowgate in relation
to the Placing
"Placing Price" 2.8 pence per Placing Share
"Placing Shares" the new Ordinary Shares to be issued
by the Company at the Placing Price,
pursuant to the Placing
"Resolutions" the resolutions set out in the Notice
of General Meeting
"Shareholders" holders of Ordinary Shares
"UK" the United Kingdom of Great Britain
and Northern Ireland
"Vendors" Tom Ewart, Neil Hourston, Neil Simpson,
Graham Stewart, Jonathan Angel, Robert
Amstell, and Matthew Lancod
This information is provided by RNS
The company news service from the London Stock Exchange
END
MSCUKSNRBNAARAA
(END) Dow Jones Newswires
November 09, 2017 11:51 ET (16:51 GMT)
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