Acquisition and Placing

RNS Number : 8362G

Gresham House PLC

08 November 2018

 

NEITHER THIS ANNOUNCEMENT NOR ANY PART OF IT CONSTITUTES AN OFFER TO SELL OR ISSUE OR THE SOLICITATION OF AN OFFER TO BUY, SUBSCRIBE OR ACQUIRE ANY SECURITIES IN ANY JURISDICTION IN WHICH ANY SUCH OFFER OR SOLICITATION WOULD BE UNLAWFUL AND THE INFORMATION CONTAINED HEREIN IS NOT FOR PUBLICATION OR DISTRIBUTION, DIRECTLY OR INDIRECTLY, IN OR INTO THE UNITED STATES, AUSTRALIA, NEW ZEALAND, CANADA, JAPAN, THE REPUBLIC OF SOUTH AFRICA OR ANY JURISDICTION IN WHICH SUCH PUBLICATION OR DISTRIBUTION WOULD BE UNLAWFUL. 

THE INFORMATION CONTAINED IN THIS ANNOUNCEMENT DOES NOT CONSTITUTE AN OFFERING OF SECURITIES FOR SALE IN THE UNITED STATES OF AMERICA AND NO SECURITIES HAVE BEEN OR WILL BE REGISTERED UNDER THE UNITED STATES SECURITIES ACT 1933, AS AMENDED OR UNDER THE SECURITIES LAWS OF ANY STATE OR OTHER JURISDICTION IN THE UNITED STATES OF AMERICA.

 FOR IMMEDIATE RELEASE

Gresham House plc

("Gresham House", the "Company" or the "Group")

Acquisition of the fund and investment management business of
Livingbridge VC LLP

and

Placing of approximately £11.7 million

Gresham House, (AIM: GHE) the specialist alternative asset manager, is pleased to announce the acquisition of the fund and investment management businesses of Livingbridge VC LLP, ("Livingbridge VC") for an initial consideration of £30.0 million, increasing up to £40.0 million dependent on the achievement of certain targets (the "Acquisition").

Key Highlights

§ Strategic rationale: 

o  UK equities asset manager with a strong brand and track record

o  Product development - creates platform for accelerated organic growth

o  Significant increases in investment capability with consistent investment philosophies (public and private equity combination)

o  Diversifying and expanding the client base including platforms and wealth manager distribution channel

o  Additions to existing VCT products and Strategic Equity division

§ Increases group AUM to over £2bn, and profitability enhancement

§ Materially earnings enhancing plus additional cost synergies allows acceleration toward operating margin targets

§ Identified cost synergies and opportunity for cross fertilisation between investor bases

§ The acquisition will include the Baronsmead VCT products alongside two open-ended vehicles, LF Livingbridge UK Micro Cap Fund and LF Livingbridge UK Multi Cap Income Fund

The Acquisition combines two UK focussed asset managers with aligned investment philosophies, and enhances the investment expertise and depth in Gresham House's existing Strategic Equity team. Upon completion, Gresham House's assets under management ("AUM") will be over £2 billion.

The Acquisition will be funded through the allotment of 1,562,500 ordinary shares of £0.25 each in the Company (the "Consideration Shares"), to Livingbridge VC, a new credit facility, a vendor placing of 2,617,628 ordinary shares of £0.25 each ("Placing Shares") (the "Placing") and existing cash resources of the Company. The Placing Price of 448 pence per Placing Share is at the middle market price of 448 pence per Ordinary Share on 7 November 2018 (being the last business day prior to the release of this announcement).

Subject to the acquired business achieving certain performance targets over approximately a three-year period, further consideration of up to £10.0 million will be payable, comprised of cash and Ordinary Shares. The Company expects the Acquisition to exceed its medium-term ROIC target of 15%.

The Acquisition will increase the Group's momentum towards its 40 per cent. operating margin target. The Group has identified a number of cost synergies in the business and will also benefit from greater investment management and distribution capacity following completion of the transaction.

The Placing has raised approximately £11.7 million. Canaccord Genuity Limited ("Canaccord") is acting as financial adviser, nominated adviser, joint broker and bookrunner in relation to the Placing.  Jefferies International Limited ("Jefferies") is acting as joint broker and bookrunner in relation to the Placing.  The Placing is not being underwritten.

Completion of the Placing is conditional on, inter alia, completion of the Acquisition and Admission of the Placing Shares

Livingbridge VC

The fund and investment management business of Livingbridge VC has built a strong investment track record, serving a client base including private individuals, wealth managers, IFAs and institutions. It manages approximately £0.5 billion of quoted and unquoted equities via the Baronsmead venture capital trusts, ("VCTs") and two open-ended investment companies ("OEICs"), LF Livingbridge UK Micro Cap Fund and LF Livingbridge UK Multi Cap Income Fund.

The approach to investing is similar to that of the Group's Strategic Equity unit, targeting superior returns through investment into UK smaller public and private companies over a longer-term investment horizon.

All 16 employees at the fund management businesses of Livingbridge VC, comprising 8 specialist investment and research professionals alongside 8 distribution, finance and operational staff, will join the Company's Strategic Equity operations and the funds will add to the Group's product stable. The gross assets being acquired as part of the transaction by the Company are valued at £1. The Directors believe that the Company will maintain and, enhance the service provision offered to existing clients, through increased network, further investment, support of the team and increased resources. The three-year transition process has been designed to ensure a smooth integration.

The combined Baronsmead and Equity Funds business generated unaudited EBITDA and profit before tax of £5.0 million, (ex-performance fees) on revenues of £9.1 million in the year ended 31 December 2017. In the five years to 2017, the combined business achieved an 8.0 per cent CAGR in assets under management ("AUM"), which is expected to accelerate with the growth of its OEICs.

Commenting on the Acquisition, Anthony Dalwood, Gresham House's chief executive, said:

"The Livingbridge VC fund management business' investment philosophy across public and private equity companies has generated strong performance and has clear financial and strategic benefits for long-term Gresham House shareholder value. The excellent team will add to our existing high-quality investment and client personnel, enabling additional growth opportunities for the Group. We look forward to supporting the Baronsmead VCT and Equity Funds brands, which are well respected in their markets, alongside their strong investment track record.

"The acquisition is an extension of Gresham House's organic strategy, aligning investment goals of the two teams. Additionally, we expect the deal to be immediately earnings enhancing, taking the Group's AUM past £2 billion, increasing our scale and relevance to investors and creating additional shareholder value. We're very much looking forward to welcoming the Livingbridge VC fund management team to Gresham House with whom we have a close cultural fit."

Further details of the Acquisition

The Company has agreed to acquire, through its subsidiary Gresham House Asset Management Limited and subject to the satisfaction of certain conditions, the fund and investment management business of Livingbridge VC for a total initial consideration of £30.0 million, which may rise to £40.0 million subject to trading performance of the acquired assets over the three period following completion of the Acquisition. 

The Acquisition will be funded through the allotment of 1,562,500 ordinary shares of £0.25 each in the Company (the "Consideration Shares") to Livingbridge VC, a new credit facility, a vendor placing of 2,617,628  ordinary shares of £0.25 each ("Placing Shares") (the "Placing") and the existing cash resources of the Company. The Placing Price of 448 pence per Placing Share is at the middle market price of 448 pence per Ordinary Share on 7 November 2018 (being the last business day prior to the release of this announcement).

Completion of the Acquisition is expected to occur on or around 30 November 2018.  Completion of the Acquisition is not conditional on completion of the Placing and in the event that the Placing does not complete, the cash payable to Livingbridge VC that would have been funded by the proceeds of the Vendor Placing will be satisfied by the Company using its existing cash resources and Livingbridge VC will sell the Placing Shares to the Company's employee benefit trust for nil consideration.

Trading Update

The Directors are pleased to confirm the Company is currently trading in line with market expectations.

Details of the Placing

 The Company and Livingbridge VC  today entered into a vendor placing agreement with the Banks ("the Vendor Placing Agreement"). Pursuant to the Vendor Placing Agreement, the Banks have secured purchasers of the Placing Shares at the Placing Price and accordingly have raised approximately £11.7 million.

In addition, the Company  today entered into an arrangement agreement with the Banks (the "Arrangement Agreement") pursuant to which the Banks  agreed to arrange the Vendor Placing in order to facilitate the Acquisition. The Company has given warranties and indemnities customary on a placing in favour of the Banks in the Arrangement Agreement.

Your attention is drawn to the detailed terms and conditions of the Placing set out in the Appendix to this Announcement (which forms part of this Announcement).

The Appendix to this Announcement contains the detailed terms and conditions of the Placing and the basis on which investors agreed to participate in the Placing . The Placing has not been underwritten by the Banks. Placees are deemed to have read and understood this Announcement in its entirety, including the Appendix, and to have made their offer on the terms and subject to the conditions contained herein and to have given the representations, warranties, undertakings and acknowledgements contained in the Appendix to this Announcement.

The Placing Shares will be issued credited as fully paid and will rank pari passu with the existing Ordinary Shares, including the right to receive all dividends and other distributions (if any) declared, made or paid on or in respect of such shares after the date of their issue.

Application will be made for the Consideration Shares and the Placing Shares to be admitted to trading on AIM ("Admission"). It is expected that the Acquisition will complete and Admission will occur at 8.00 a.m. on 30 November 2018 with the transfer and settlement of the Placing Shares with Placees shortly following Admission. In this regard, the Placing Shares are expected to settle in the CREST accounts of Placees within two Business Days of the date of Admission.

Completion of the Placing is conditional on the Completion of the Acquisition, Admission of the Placing Shares and on each of the Vendor Placing Agreement and the Arrangement Agreement becoming unconditional in all respects.  In the event that, for whatever reason, the Placing does not become unconditional or is terminated, the cash payable to Livingbridge VC that would have been funded by the proceeds of the Vendor Placing will be satisfied by the Company using existing cash resources and Livingbridge VC will sell the Placing Shares to the Company's employee benefit trust for nil consideration.

Related Party Transaction

Royal County of Berkshire Pension Fund ("RCBPF") has committed to subscribe for up to 490,228 Placing Shares in the Placing. Due to the size of RCBPF's existing holding of 3,937,316 Ordinary Shares in the capital of the Company, representing approximately 19.1 per cent. of the current issued share capital, this transaction is considered to be a related party transaction pursuant to AIM Rule 13 of the AIM Rules.

The Directors consider, having consulted with the Company's nominated adviser, Canaccord Genuity, that the terms of RCBPF's participation in the Placing are fair and reasonable in so far as Shareholders are concerned. Immediately following Admission, it is envisaged that RCBPF will hold 4,427,544 Ordinary Shares representing approximately 18.28 per cent. of the enlarged share capital.

Details of the credit facility

The Company has entered into new banking facilities in connection with the Acquisition provided by Banco Santander S.A. (London branch). The facilities include a new term loan of £6.0 million and a revolving credit facility of £4.0 million. The new facilities are conditional upon completion of the Acquisition and are repayable in November 2021.

Placing and Acquisition Considerations

The Directors believe the Acquisition to be in the best interests of the Company and its shareholders as a whole. In making this statement the Directors have spent time, and have taken appropriate advice, in considering the Acquisition and the method by which the cash consideration payable in respect of the Acquisition should be funded. The Directors concluded that the Placing was the most appropriate structure to raise equity funding, alongside funds raised from the new credit facility and the existing cash resources of the Company.

By incorporating a vendor placing into the cash consideration payable in respect of the Acquisition, the Company is utilising the authorities granted to it under Resolution 7, being the ability to allot shares for shares, passed at its last annual general meeting held on 7 May 2018 (the "AGM"). The Company retains the disapplication of pre-emption rights in respect of issues of shares for cash granted under Resolution 8, at its AGM. The Company believes it is important to retain its cash allotment authorities as it provides funding flexibility in relation to future corporate or strategic events,

For more information contact:

Gresham House plc Tony Dalwood, Chief Executive Officer Kevin Acton, Finance Director	[phone]
Canaccord Genuity - Nominated Adviser, Joint Broker and Bookrunner Bobbie Hilliam Michael Reynolds	[phone]
Jefferies International Limited - Joint Broker and Bookrunner Paul Nicholls Max Jones Chris Binks	[phone]
Taurus London - Lead Adviser to Gresham House plc	[phone]
Peter Tracey
Tom Fyson
Montfort Communications Olly Scott Louis Supple	[e-mail] [phone] [phone]

About Gresham House

Gresham House plc is an AIM quoted specialist asset manager providing funds, direct investments and tailored investment solutions, including co-investment across a range of highly differentiated alternative investment strategies. Our expertise includes strategic public and private equity (private assets),   forestry, renewable energy, housing and infrastructure, The Group aims to deliver sustainable financial returns and is committed to building long-term partnerships with clients, (institutions, family offices, high-net-worth individuals, charities and endowments and private individuals) to help them achieve their financial goals.

Shareholder value creation will be driven by long-term growth in earnings as a result of increasing AUM and returns from invested capital.

www.greshamhouse.com

About Livingbridge VC LLP

The fund and investment management business of Livingbridge VC LLP consists of the Baronsmead VCTs and Livingbridge Equity Funds.  Launched in 1995, the Baronsmead VCT brand was one of the very first VCTs and is known for its consistent performance and governance within its sector. The Equity Funds business encompasses the highly respected LF Livingbridge UK Micro Cap Fund launched in 2009 and LF Livingbridge UK Multi Cap Income Fund launched in 2017.

Livingbridge VC was incorporated and registered in England and Wales on 16 June 2006 as a limited liability partnership, with registered number OC320408, and is authorised and regulated by the Financial Conduct Authority (FCA). The registered address of Livingbridge VC is 100 Wood Street, London EC2V 7AN. Several of the individual partners of both Livingbridge VC and Livingbridge EP have worked together since 2005. Before 2005, said partners were employees or directors of ISIS Equity Partners plc which was the Investment Manager of the Baronsmead VCTs.

www.baronsmeadvcts.co.uk

www.livingbridge.com/equity-funds/ 

IMPORTANT INFORMATION

This Announcement includes statements that are, or may be deemed to be, "forward-looking statements". These forward-looking statements can be identified by the use of forward-looking terminology, including the terms "believes", "estimates", "plans", "anticipates", "targets", "aims", "continues", "expects", "intends", "hopes", "may", "will", "would", "could" or "should" or, in each case, their negative or other variations or comparable terminology. These forward-looking statements include matters that are not facts. They appear in a number of places throughout this Announcement and include statements regarding the Directors' intentions, beliefs or current expectations concerning, amongst other things, the Group's results of operations, financial condition, liquidity, prospects, growth, strategies and the industries in which the Group operates. By their nature, forward-looking statements involve risk and uncertainty because they relate to future events and circumstances. A number of factors could cause actual results and developments to differ materially from those expressed or implied by the forward-looking statements, including, without limitation: ability to find appropriate investments in which to invest and to realise investments held by the Group; conditions in the public markets; the market position of the Group; the earnings, financial position, cash flows, return on capital and operating margins of the Group; the anticipated investments and capital expenditures of the Group; changing business or other market conditions; changes in political or tax regimes, exchange rates and clients; and general economic conditions. These and other factors could adversely affect the outcome and financial effects of the plans and events described herein. Forward-looking statements contained in this Announcement based on past trends or activities should not be taken as a representation that such trends or activities will continue in the future. Subject to any requirement under the AIM Rules for Companies or other applicable legislation or regulation, neither the Company nor any of the Banks undertake any obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. Investors should not place undue reliance on forward-looking statements, which speak only as of the date of this Announcement.

No statement in this Announcement or incorporated by reference into this Announcement is intended to constitute a profit forecast or profit estimate for any period, nor should any statement be interpreted to mean that earnings or earnings per share will necessarily be greater or lesser than those for the relevant preceding financial periods for the Company.

This Announcement contains information regarding the Company's business and the markets in which it operates and competes, which the Company has obtained from various third party sources. Where information has been sourced from a third party it has been accurately reproduced and, so far as the Company is aware and is able to ascertain from the information published by that third party, no facts have been omitted which would render the reproduced information inaccurate or misleading. Such information has not been audited or independently verified.

Certain data in this Announcement, including financial, statistical and operating information, has been rounded.

This Announcement is for information purposes only and shall not constitute an offer to buy, sell, issue, or subscribe for, or the solicitation of an offer to buy, sell, issue, or subscribe for any securities, nor shall there be any sale of securities in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such jurisdiction.

Canaccord, which is a member of the London Stock Exchange, is authorised and regulated in the United Kingdom by the Financial Conduct Authority and is acting as financial adviser, nominated adviser and joint broker and bookrunner for the purposes of the AIM Rules for Companies.  Jefferies International Limited which is a member of the London Stock Exchange, is authorised and regulated in the United Kingdom by the Financial Conduct Authority and is acting as joint broker and bookrunner for the purposes of the AIM Rules for Companies.  Both of the Banks are acting exclusively for the Company in connection with the matters referred to in this Announcement and for no-one else and will not be responsible to anyone other than the Company for providing the protections afforded to their respective clients nor for providing any advice in relation to the contents of this Announcement or any transaction, arrangement or matter referred to herein.  The responsibilities of Canaccord, as nominated adviser, are owed solely to the London Stock Exchange plc and are not owed to the Company or to any Director or any other person and accordingly no duty of care is accepted in relation to them.

This Announcement has been issued by and is the sole responsibility of the Company. No representation or warranty, express or implied, is or will be made as to, or in relation to, and no responsibility or liability is or will be accepted by any of the Banks or by any of their respective affiliates or agents as to, or in relation to, the accuracy or completeness of this Announcement or any other written or oral information made available to or publicly available to any interested party or its advisers, and any liability therefore is expressly disclaimed.

The distribution of this Announcement and the offering of the Placing Shares in certain jurisdictions may be restricted by law. No action has been taken by the Company or the Banks that would permit an offering of such shares or possession or distribution of this Announcement or any other offering or publicity material relating to such shares in any jurisdiction where action for that purpose is required. Persons into whose possession this Announcement comes are required by the Company and the Banks to inform themselves about, and to observe such restrictions.

Persons (including, without limitation, nominees and trustees) who have a contractual or other legal obligation to forward a copy of the Appendix or this Announcement should seek appropriate advice before taking any action.

The Placing Shares to which this Announcement relates may be illiquid and / or subject to restrictions on their resale. Prospective purchasers of the Placing Shares should conduct their own due diligence on the Placing Shares. If you do not understand the contents of this Announcement you should consult an authorised financial adviser.

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.

This Announcement is released by the Company and contains inside information for the purposes of Article 7 of the Market Abuse Regulation (EU) 596/2014 ("MAR"), encompassing information relating to, inter alia, the acquisition of Livingbridge VC and the proposed Placing to raise approximately £11.7 million  and is disclosed in accordance with the Company's obligations under Article 17 of MAR.

Information to Distributors

Solely for the purposes of the product governance requirements contained within: (a) EU Directive 2014/65/EU on markets in financial instruments, as amended ("MiFID II"); (b) Articles 9 and 10 of Commission Delegated Directive (EU) 2017/593 supplementing MiFID II; and (c) local implementing measures (together, the "MiFID II Product Governance Requirements"), and disclaiming all and any liability, whether arising in tort, contract or otherwise, which any "manufacturer" (for the purposes of the MiFID II Product Governance Requirements) may otherwise have with respect thereto, the Placing Shares have been subject to a product approval process, which has determined that the Placing Shares are: (i) compatible with an end target market of retail investors and investors who meet the criteria of professional clients and eligible counterparties, each as defined in MiFID II; and (ii) eligible for distribution through all distribution channels as are permitted by MiFID II (the "Target Market Assessment").

Notwithstanding the Target Market Assessment, distributors should note that: the price of the Placing Shares may decline and investors could lose all or part of their investment; the Placing Shares offer no guaranteed income and no capital protection; and an investment in the Placing Shares is compatible only with investors who do not need a guaranteed income or capital protection, who (either alone or in conjunction with an appropriate financial or other adviser) are capable of evaluating the merits and risks of such an investment and who have sufficient resources to be able to bear any losses that may result therefrom. The Target Market Assessment is without prejudice to the requirements of any contractual, legal or regulatory selling restrictions in relation to the Placing. Furthermore, it is noted that, notwithstanding the Target Market Assessment, the Banks have only procured investors who meet the criteria of professional clients and eligible counterparties.

For the avoidance of doubt, the Target Market Assessment does not constitute: (a) an assessment of suitability or appropriateness for the purposes of MiFID II; or (b) a recommendation to any investor or group of investors to invest in, or purchase, or take any other action whatsoever with respect to the Placing Shares.

Each distributor is responsible for undertaking its own target market assessment in respect of the Placing Shares and determining appropriate distribution channels.

Unless otherwise stated, all times referred to in this Announcement are references to the time in London.

References in this Announcement to ''£'', ''sterling'', ''p'' and ''pence'' are to the lawful currency of the United Kingdom.

DEFINITIONS

The following definitions apply throughout this Announcement unless the context requires otherwise:

"Act"	the Companies Act 2006, as amended from time to time
"Acquisition"	the acquisition of certain assets of Livingbridge on the terms of, and subject to the conditions set out in, the Acquisition Agreement
"Acquisition Agreement"	means the business purchase agreement between the (1) the Company (2) GHA and (3) Livingbridge, dated on or around the date of this Agreement containing the terms on, and conditions subject to, which GHA will make the Acquisition
"Admission"	admission of the Consideration Shares and Placing Shares to trading on AIM, which will take place at the time of completion of the Acquisition and which is expected to occur on or around 8.00 a.m. on 30 November 2018 (or such later date as may be agreed by the Company, Canaccord and Jefferies, not being later than 31 December 2018)
"AIM"	AIM, a market operated by the London Stock Exchange
"AIM Rules" or "AIM Rules for Companies"	the AIM Rules for Companies published by the London Stock Exchange from time to time
"Appendix"	means the appendix to this Announcement
"Arrangement Agreement"	the conditional agreement dated 8 November 2018 between the Company, Canaccord and Jefferies relating to the Acquisition and Placing
"AUM"	assets under management
"Banks"	Canaccord and Jefferies
"Board" or "Directors"	the directors of the Company
"certificated" or "in certificated form"	a share or other security not held in uncertificated form (i.e. not in CREST)
"Canaccord"	Canaccord Genuity Limited, the Company's nominated adviser, joint broker and joint bookrunner
"Company" or "Gresham House"	Gresham House plc, a company registered in England and Wales with registered number 00000871
"Completion"	completion of the Acquisition Agreement in accordance with its terms
"Consideration Shares"	the 1,562,500 new Ordinary Shares to be allotted and issued to Livingbridge in connection with the Acquisition in accordance with the Acquisition Agreement
"CREST"	the relevant system (as defined in the CREST Regulations) in respect of which Euroclear UK & Ireland Limited is the operator (as defined in the CREST Regulations)
"CREST Regulations"	the Uncertificated Securities Regulations 2001 (SI 2001/3755) as amended from time to time
"Disclosure Guidance and Transparency Rules"	(a)      the disclosure guidance made by the UKLA in accordance with section 73A(3) of Part VI of FSMA relating to the disclosure of information in respect of financial instruments (and, where the context requires, the disclosure rules made by the UKLA in accordance with section 73A(3) of Part VI of FSMA relating to the disclosure of information in respect of financial instruments which have been admitted to trading on a regulated market or for which a request for admission to trading on such market has been made); and (b)      the transparency rules made by the UKLA under section 73A(6) of Part VI of FSMA in relation to major shareholdings and the notification and dissemination of information by issuers of transferable securities (and, in each case, as that guidance and those rules may be amended from time to time)
"EU"	the European Union
"Existing Ordinary Shares"	the 20,600,550 Ordinary Shares in issue as at the date of this Announcement
"Financial Conduct Authority" or "FCA"	the Financial Conduct Authority of the United Kingdom
"FSMA"	the Financial Services and Markets Act 2000 (as amended, modified, consolidated, re-enacted or replaced from time to time)
"GHA"	Gresham House Asset Management Limited, a  wholly-owned subsidiary of the Company
"Group"	the Company and its subsidiary undertakings from time to time
"Jefferies"	Jefferies International Limited, the Company's joint broker and bookrunner
"Livingbridge"	Livingbridge VC LLP
"London Stock Exchange"	London Stock Exchange plc
"Long Stop Date"	31 December 2018
"MAR"	the EU Market Abuse Regulation (2014/596/EU)
"Neville Registrars Limited" or "Registrar"	Neville Registrars Limited, the Company's registrar
"Official List"	the official list of the Financial Conduct Authority
"Ordinary Shares"	ordinary shares of 25 pence each in the share capital of the Company
"Placing"	means the conditional placing by Canaccord and Jefferies of the Placing Shares on the terms and subject to the conditions contained in the Vendor Placing Agreement and the Press Announcement (including the placing terms and conditions in the announcement);
"Placing Price"	448 pence per Placing Share
"Placing Shares"	means the 2,617,628 Ordinary Shares to be purchased by institutional and other investors at the Placing Price under the Placing
"Prospectus Rules"	the prospectus rules made by the FCA in the exercise of its function as competent authority pursuant to Part VI of the FSMA, as amended from time to time
"Restricted Jurisdictions"	any jurisdiction where the extension or availability of an offer of Ordinary Shares, or the accessing of the Circular, or its publication, distribution or other dissemination, would be prohibited by, or would breach, any applicable law or regulation
"Shareholders"	holders of Ordinary Shares from time to time
"subsidiary"	as defined in section 1159 and Schedule 6 of the Act
"subsidiary undertaking"	as defined in section 1162 and Schedule 6 of the Act
"UK" or "United Kingdom"	the United Kingdom of Great Britain and Northern Ireland
"UK Listing Authority" or "UKLA"	the FCA, acting in its capacity as United Kingdom listing authority
"uncertificated" or "in uncertificated form"	recorded on the register of members of the Company as being held in uncertificated form in CREST and title to which, by virtue of the CREST Regulations, may be transferred by means of the CREST system
"Vendor Placing Agreement"	means the agreement entered into today between Livingbridge, the Banks and the Company, pursuant to which, inter alia, Livingbridge has agreed to appoint each of the  Banks as its agent to procure Placees for the Placing Shares
"United Kingdom" or "UK"	the United Kingdom of Great Britain and Northern Ireland
"United States" or "US"	the United States of America, its territories and possessions, any state of the United States of America and the District of Columbia
"US Securities Act"	the United States Securities Act of 1933, as amended

Unless otherwise stated, all times referred to in this Announcement are references to the time in London.

All references to legislation in this Announcement are to the legislation of England and Wales unless the contrary is indicated. Any reference to any provision of any legislation shall include any amendment, modification, re-enactment or extension thereof.

Words importing the singular shall include the plural and vice versa, and words importing the masculine gender shall include the feminine or neutral gender.

For the purpose of this Announcement, ''subsidiary'', ''subsidiary undertaking'' and ''undertaking'' have the meanings respectively given to them by the Companies Act and ''associated undertaking'' has the meaning given to it by paragraph 19 of schedule 6 of the large and Medium-sized Companies and Groups (Accounts and Reports) Regulations 2008 (but ignoring for this purpose sub- paragraph 1(b) thereof).

References to ''£'', ''sterling'', ''p'' and ''pence'' are to the lawful currency of the United Kingdom.

APPENDIX

TERMS AND CONDITIONS OF THE PLACING

THIS ANNOUNCEMENT, INCLUDING THIS APPENDIX AND THE INFORMATION IN IT IS RESTRICTED AND IS NOT FOR PUBLICATION, RELEASE OR DISTRIBUTION, DIRECTLY OR INDIRECTLY, IN WHOLE OR IN PART, IN OR INTO THE UNITED STATES, AUSTRALIA, CANADA, JAPAN, OR THE REPUBLIC OF SOUTH AFRICA OR ANY OTHER JURISDICTION IN WHICH SUCH PUBLICATION OR DISTRIBUTION WOULD BE UNLAWFUL.

IMPORTANT INFORMATION ON THE PLACING FOR INVITED PLACEES ONLY.

MEMBERS OF THE PUBLIC ARE NOT ELIGIBLE TO TAKE PART IN THE PLACING. THIS APPENDIX AND THE TERMS AND CONDITIONS SET OUT HEREIN ARE FOR INFORMATION PURPOSES ONLY AND ARE DIRECTED ONLY AT: (A) PERSONS WHO ARE IN A MEMBER STATE OF THE EUROPEAN ECONOMIC AREA AND ARE "QUALIFIED INVESTORS" AS DEFINED IN ARTICLE 2.1(E) OF THE EU PROSPECTUS DIRECTIVE (WHICH MEANS DIRECTIVE 2003/71/EC AND INCLUDES ANY RELEVANT IMPLEMENTING DIRECTIVE MEASURE IN ANY MEMBER STATE) (THE "PROSPECTUS DIRECTIVE"); AND (B) IN THE UNITED KINGDOM, PERSONS WHO ARE: (I) "INVESTMENT PROFESSIONALS" WITHIN THE MEANING OF ARTICLE 19(5) OF THE FINANCIAL SERVICES AND MARKETS ACT 2000 (FINANCIAL PROMOTION) ORDER 2005 (THE "ORDER"); (II) PERSONS FALLING WITHIN ARTICLE 49(2)(A) TO (D) ("HIGH NET WORTH COMPANIES, UNINCORPORATED ASSOCIATIONS, ETC.") OF THE ORDER; OR (III) PERSONS TO WHOM IT MAY OTHERWISE BE LAWFULLY COMMUNICATED (ALL SUCH PERSONS TOGETHER BEING REFERRED TO AS "RELEVANT PERSONS"). THIS APPENDIX AND THE TERMS AND CONDITIONS SET OUT HEREIN MUST NOT BE ACTED ON OR RELIED ON BY PERSONS WHO ARE NOT RELEVANT PERSONS. ANY INVESTMENT OR INVESTMENT ACTIVITY TO WHICH THIS APPENDIX AND THE TERMS AND CONDITIONS SET OUT HEREIN RELATES IS AVAILABLE ONLY TO RELEVANT PERSONS AND WILL BE ENGAGED IN ONLY WITH RELEVANT PERSONS. THIS APPENDIX DOES NOT ITSELF CONSTITUTE AN OFFER FOR SALE OR SUBSCRIPTION OF ANY SECURITIES IN THE COMPANY. THIS ANNOUNCEMENT IS NOT AN OFFER OF OR SOLICITATION TO PURCHASE OR SUBSCRIBE FOR SECURITIES IN THE UNITED STATES. THE SECURITIES REFERRED TO HEREIN HAVE NOT BEEN AND WILL NOT BE REGISTERED UNDER THE U.S. SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), AND MAY NOT BE OFFERED OR SOLD IN THE UNITED STATES, EXCEPT PURSUANT TO AN APPLICABLE EXEMPTION FROM, OR AS PART OF A TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT. NO OFFERING OF SECURITIES IS BEING MADE IN THE UNITED STATES. 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 OWN ADVISERS AS TO LEGAL, TAX, BUSINESS AND RELATED ASPECTS OF AN INVESTMENT IN PLACING SHARES.

Persons who are invited to and who choose to participate in the Placing, by making (or on whose behalf there is made) an oral or written offer to purchase Placing Shares (the "Placees"), will be deemed to have read and understood this Announcement, including this Appendix, in its entirety and to be making such offer on the terms and conditions, and to be providing the representations, warranties, acknowledgements, and undertakings contained in this Appendix. In particular each such Placee represents, warrants and acknowledges to the Company, Canaccord and Jefferies that:

1.         it is a Relevant Person (as defined above) 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 any Placing Shares acquired by it as a financial intermediary, as that term is used in Article 3(2) of the Prospectus Directive, (i) 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 Member State of the European Economic Area which has implemented the Prospectus Directive other than Qualified Investors or in circumstances in which the prior consent of Canaccord or Jefferies has been given to the offer or resale; or (ii) 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 in an "offshore transaction" as defined in and pursuant to Regulation S under the Securities Act; and

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.

The Company, Canaccord and Jefferies will rely upon the truth and accuracy of the foregoing representations, acknowledgements and agreements.

This Announcement does not constitute an offer, and may not be used in connection with an offer, to sell or issue or the solicitation of an offer to purchase any Placing Shares in any jurisdiction in which such offer or solicitation is or may be unlawful. This Announcement and the information contained herein is not for publication or distribution, directly or indirectly, to persons in the United States, Australia, New Zealand, Canada, Japan or the Republic of South Africa or in any other jurisdiction in which such publication or distribution is unlawful. Persons into whose possession this Announcement may come are required by the Company to inform themselves about and to observe any restrictions of transfer of this Announcement. No public offer of securities of the Company is being made in the United Kingdom, the United States or elsewhere.

In particular, the Placing Shares referred to in this Announcement have not been and will not be registered under the Securities Act or any laws of or with any securities regulatory authority of any state or other jurisdiction of the United States, and may not be offered, sold, pledged or otherwise transferred within the United States except pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act and the securities laws of any state or other jurisdiction of the United States. The Placing Shares are being offered and sold only outside the United States in accordance with Regulation S.

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 or the South African Reserve Bank; and the Placing Shares have not been, nor will they be, registered under or offered in compliance with the securities laws of any state, province or territory of Australia, New Zealand, Canada, 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 Australia, New Zealand, Canada, 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 or other legal obligation to forward a copy of this Appendix or the Announcement of which it forms part 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 the "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 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 this Appendix, unless the context otherwise requires, "Placee" means a Relevant Person (including individuals, funds or others) on whose behalf a commitment to purchase Placing Shares has been given.

Details of the Placing

Canaccord and Jefferies have entered into the Arrangement Agreement with the Company pursuant to which the Banks have been appointed, on the terms and subject to the conditions set out therein, as its agent in connection with the Placing and Admission and to provide all reasonable assistance to the Company for the purpose of arranging and facilitating the Placing and Admission. In addition, the Banks have also entered into a Vendor Placing Agreement with the Company and Livingbridge VC, pursuant to which the Banks have conditionally agreed, on the terms and subject to the conditions set out therein, as agents for Livingbridge VC, to use their respective reasonable endeavours to place the Placing Shares at the Placing Price with certain institutional investors. The Placing is not being underwritten by Canaccord or Jefferies or any other person.

The Placing Shares will, when issued, be credited as fully paid and will rank pari passu in all respects with the existing Ordinary Shares in issue (the "Existing Ordinary Shares"), including the right to receive all dividends and other distributions (if any) declared, made or paid on or in respect of the Existing Ordinary Shares after the date of issue of the Placing Shares.

Application for admission to trading

Application will be made for admission of the Placing Shares to trading on AIM at the time of completion of the Acquisition. It is expected that Admission will become effective on or around 8.00 a.m. on 30 November 2018 and that settlement of the Placing Shares with Placees will occur shortly thereafter on or around 8.00 a.m. on 30 November 2018. If there is any change to this date, an announcement will be made.

Participation in, and principal terms of, the Placing

1.         Canaccord and Jefferies have each been appointed as the Company's bookrunners in connection with the Placing and as agents for and on behalf of Livingbridge VC to effect the sale of the Placing Shares pursuant to the Placing. Each of Canaccord and Jefferies is regulated by the FCA, is acting exclusively for the Company and Livingbridge VC 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 Canaccord and Jefferies or for providing advice in relation to the matters described in this Announcement. 

The Banks are arranging the Placing as agents of the Company and Livingbridge VC.

Participation in the Placing will only be available to persons who may lawfully be, and are, invited to participate by the Banks. Each Bank and its respective affiliates are entitled to acquire Placing Shares as principal.

2.   Each Placee's allocation will be confirmed to Placees orally, or by email, by Canaccord and/or Jefferies and a trade confirmation or contract note will be dispatched in connection therewith. A bookrunner's oral or emailed confirmation to such Placee will constitute an irrevocable legally binding commitment upon such person (who will at that point become a Placee) in favour of Canaccord or Jefferies, the Company and Livingbridge VC, under which it agrees to purchase the number of Placing Shares allocated to it at the Placing Price on the terms and conditions set out in this Appendix (which are deemed to be incorporated in such trade confirmation or contract note) and in accordance with the Company's Articles of Association.

3.   Subject to paragraph 1 above, the Banks may choose to accept or reject bids, either in whole or in part, on the basis of allocations determined at its discretion (in consultation with the Company) and may scale down any bids for this purpose on such basis as they may determine. Canaccord and Jefferies may also, notwithstanding paragraph 1 above, subject to the prior consent of the Company: (i) allocate Placing Shares after the time of any initial allocation to any person submitting a bid after that time; and (ii) allocate Placing Shares after the announcement of the Placing to any person submitting a bid after that time.

4.   Placing Shares will be acquired on the terms and subject to the conditions in this Announcement and will be legally binding on the Placee on behalf of which it is made and, except with the consent of Canaccord or Jefferies, will not be capable of variation or revocation after the time at which it is submitted. Each Placee will also have an immediate, separate, irrevocable and binding obligation, owed to Canaccord or Jefferies, to pay to Canaccord or Jefferies (or as Canaccord or Jefferies may direct) in cleared funds an amount equal to the product of the Placing Price and the number of Placing Shares which such Placee has agreed to purchase. Each Placee's obligations will be owed to Canaccord or Jefferies.

5.   Except as required by law or regulation, no press release or other announcement will be made by Canaccord, Jefferies or the Company using the name of any Placee (or its agent), in its capacity as Placee (or agent), other than with such Placee's prior written consent.

6.   Irrespective of the time at which a Placee's allocation pursuant to the Placing is 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".

7.   All obligations 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 "Right to terminate the Placing".

8.   By participating in the Placing, each Placee agrees 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.

9.   To the fullest extent permissible by law and the applicable rules of the FCA, neither Canaccord nor Jefferies or any of their respective affiliates shall have any liability to Placees (or to any other person whether acting on behalf of a Placee or otherwise whether or not a recipient of these terms and conditions) in respect of the Placing. Each Placee acknowledges and agrees that the Company is responsible for the allotment of the Placing Shares to Livingbridge VC at the time of completion of the Acquisition and that the Company and Livingbridge VC will be responsible for the subsequent transfer of the Placing Shares to Placees. Accordingly, neither Banks shall have any liability to the Placees for the failure of the Company and/or Livingbridge VC to fulfil those obligations. In particular, neither Bank nor any of their respective affiliates shall have any liability (including to the extent permissible by law, any fiduciary duties) in respect of Canaccord's or Jefferies' conduct of the Placing or of such alternative method of effecting the Placing (in whole or in part) as Canaccord and Jefferies and the Company may agree.

Conditions to the Placing

Completion of the Placing is conditional on, inter alia:

(a)        the Arrangement Agreement: (i) not having been terminated or varied or amended; and (ii) having become unconditional in all respects, save for any condition relating to the Placing and the Vendor Placing Agreement becoming unconditional in accordance with its terms (including, for the avoidance of doubt, Admission);

the Vendor Placing Agreement: (i) not having been terminated or varied or amended; and (ii) having become unconditional in all respects, save for any condition relating to the Placing and the Arrangement Agreement becoming unconditional in accordance with its terms (including, for the avoidance of doubt, Admission);

the Acquisition Agreement: (i) not having been terminated or varied or amended and (ii) having become unconditional in all respects, save for any condition relating to the Placing and either the Arrangement Agreement or Vendor Placing Agreement becoming unconditional in accordance with their terms;

the Company having complied with its obligations under the Arrangement Agreement to the extent that such obligations fall to be performed prior to Admission and that none of the warranties or undertakings in the Arrangement Agreement are untrue, inaccurate or misleading;

Livingbridge VC having complied with its obligations under the Vendor Placing Agreement to the extent that such obligations fall to be performed prior to Admission and that none of the warranties or undertakings in the Vendor Placing Agreement are untrue, inaccurate or misleading; and

Admission of the Placing Shares becoming effective by no later than 8.00 a.m. on 30 November 2018 (or such later date as the Company and the Banks may agree (being not later than 8.00 a.m. on 31 December).

If: (i) any of the conditions contained in the Arrangement Agreement or Vendor Placing Agreement in relation to the Placing Shares are not fulfilled or waived by the Banks by the respective time or date where specified (or such later time or date as the Company and the Banks may agree, but not being later than 8.00 am on 31 December 2018); (ii) any of such conditions becomes incapable of being fulfilled; or (iii) the Arrangement Agreement or Vendor Placing Agreement is terminated in its entirety in the circumstances specified below, the Placing will lapse and the Placee's rights and obligations hereunder in relation to the Placing Shares shall cease and terminate at such time and each Placee agrees that no claim can be made by the Placee against the Banks in respect thereof.

The Banks may, at their discretion and upon such terms as they think fit, waive, or extend the period for, compliance by the Company with the whole or any part of any of the Company's obligations in relation to the conditions in the Arrangement Agreement and Vendor Placing Agreement, save that the above condition relating to Admission taking place may not be waived. Any such extension or waiver will not affect Placees' commitments as set out in this Announcement.

Neither the Banks nor the Company 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 they 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 they 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 the Banks.

Right to terminate the Placing

The Banks are entitled, at any time before Admission, to terminate their obligations under the Arrangement Agreement and Vendor Placing Agreement by giving notice to the Company in certain circumstances, including, inter alia:

(a)        a party (other than Bank) fails, in any respect, to comply with any of its material obligations under the Arrangement Agreement or Vendor Placing Agreement or a breach of the warranties given by the Company in the Arrangement Agreement or by Livingbridge VC in the Vendor Placing Agreement has occurred; or

(b)        it comes to the notice of a Bank that any statement contained in the investor presentation or this Announcement was untrue, incorrect or misleading at the date of such document in any respect which the Banks consider to be material in the context of the Placing, the Acquisition and/or Admission; or

(c)        it comes to the notice of a Bank that there has been, or will be, a breach or potential breach of the Acquisition Agreement including any of the warranties thereunder which is material or such Acquisition Agreement is otherwise terminated, rescinded or frustrated; or

(d)        in either Bank's opinion, there having been a material adverse change in the financial position and/or prospects of the Company and subsidiary undertakings; or

(e)        the occurrence of a force majeure event which, in the opinion of either Bank, will or is likely to be prejudicial to the Group or the Placing.

The rights and obligations of the Placees shall terminate only in the circumstances described in these terms and conditions and will not be subject to termination by the Placee or any prospective Placee at any time or in any circumstances. By participating in the Placing, the Placees agree that the exercise of the Banks of any right of termination or other discretion under the Arrangement Agreement or the Vendor Placing Agreement shall be within the absolute discretion of either Bank, and that it need not make any reference to Placees and that it shall have no liability to Placees whatsoever in connection with any such exercise.

Upon termination, the parties to the Arrangement Agreement and Vendor Placing Agreement shall be released and discharged (except for any liability arising before or in relation to such termination) from their respective obligations under or pursuant to the Arrangement Agreement and Vendor Placing Agreement, subject to certain exceptions.

No Prospectus

The Placing Shares are being offered to a limited number of specifically invited persons only and will not be offered in such a way as to require a prospectus in the United Kingdom or in any other jurisdiction. No offering document, admission document or prospectus has been or will be submitted to be approved by the FCA in relation to the Placing, and any Placees' commitments will be made solely on the basis of the information contained in the Announcement (including this Appendix) and the Exchange Information (as defined further below).

Each Placee, by accepting a participation 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 other information (other than the Exchange Information), representation, warranty, or statement made by or on behalf of the Company or either Bank or any other person and neither the Banks nor the Company nor any other person will be liable for any Placee's decision to participate in the Placing based on any other information, representation, warranty or statement which the Placees may have obtained or received and, if given or made, such information, representation, warranty or statement must not be relied upon as having been authorised by any of Canaccord, Jefferies, the Company, or their respective officers, directors, employees or agents.

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. Neither the Company nor either of the Banks is making any undertaking or warranty to any Placee regarding the legality of an investment in the Placing Shares by such Placee under any legal, investment or similar laws or regulations. No Placee should consider any information in this Announcement to be legal, tax or business advice. Each Placee should consult its own solicitor, tax adviser and financial adviser for independent legal, tax and financial advice regarding an investment in the Placing Shares. Nothing in this paragraph shall exclude the liability of any person for fraudulent misrepresentation.

Registration and Settlement

Settlement of transactions in the Placing Shares (ISIN: GB0003887287) following Admission will take place within the system administered by Euroclear UK & Ireland Limited (CREST) provided that, subject to certain exceptions, Canaccord and Jefferies reserve the right to require settlement for, and delivery of, the Placing Shares (or a portion thereof) to Placees by such other means that they deem necessary if delivery or settlement is not possible or practicable within CREST within the timetable set out in this Announcement or would not be consistent with the regulatory requirements in any Placee's jurisdiction.

Each Placee allocated Placing Shares in the Placing will be sent a trade confirmation or contract note in accordance with the standing arrangements in place with Canaccord or Jefferies, stating the number of Placing Shares allocated to it at the Placing Price, the aggregate amount owed by such Placee to Canaccord or Jefferies (in GBP) and settlement instructions. Each Placee agrees that it will do all things necessary to ensure that delivery and payment is completed in accordance with either the standing CREST or certificated settlement instructions that it has in place with Canaccord or Jefferies.

The Placing Shares will be allotted (conditional on Admission) to Livingbridge VC under the Acquisition Agreement at the time of completion of the Acquisition which is expected to be 30 November 2018 and Admission of the Placing Shares will also take place. Completion and Admission is expected to occur on 30 November 2018 (or such later date as may be agreed by the parties, being no later than 31 December2018) and the Company will procure that the Placing Shares are delivered, credited as fully paid, to the relevant CREST accounts operated by the Banks on behalf of Livingbridge VC.

Shortly following Admission, each Bank will credit the relevant CREST accounts of each Placees with the relevant number of Placing Shares and it is expected that settlement will take place shortly thereafter on 30 November 2018, on a delivery versus payment basis.

In the event that completion of the Acquisition and, therefore, Admission is delayed then Placees will be informed on the revised trade and settlement dates of the Placing Shares (it being noted that Admission must occur no later than 31 December 2018).

Interest is chargeable daily on payments not received from Placees on the due date in accordance with the arrangements set out above at the rate of two (2) percentage points above LIBOR as determined by each Bank.

Each Placee is deemed to agree that, if it does not comply with these obligations, Canaccord or Jefferies may sell any or all of the Placing Shares allocated to that Placee on such Placee's behalf and retain from the proceeds, for the relevant Bank's account and benefit (as agents for Livingbridge VC), an amount equal to the aggregate amount owed by the Placee plus any interest due. The relevant Placee will, however, remain liable for any shortfall below the aggregate amount owed by it and may be required to bear any stamp duty or stamp duty reserve tax or securities transfer tax (together with any interest or penalties) which may arise upon the sale of such Placing Shares on such Placee's behalf. By communicating a bid for Placing Shares, each Placee confers on each Bank all such authorities and powers necessary to carry out any such sale and agrees to ratify and confirm all actions which a Bank lawfully takes in pursuance of such sale.

If Placing Shares are to be delivered to a custodian or settlement agent, Placees should ensure that the trade confirmation or contract note 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 UK stamp duty or stamp duty reserve tax or securities transfer tax. Placees will not be entitled to receive any fee or commission in connection with the Placing.

Representations, Warranties and Further Terms

By participating in the Placing, each Placee (and any person acting on such Placee's behalf) makes the following representations, warranties, acknowledgements, agreements and undertakings (as the case may be) to the Company, Canaccord and Jefferies:

1.         it represents and warrants that it has read and understood this Announcement, including the Appendix, in its entirety and that its purchase of any Placing Shares is subject to and based upon all the terms, conditions, representations, warranties, acknowledgements, agreements and undertakings and other information contained herein and undertakes not to redistribute or duplicate this Announcement;

it acknowledges that if: (i) any of the conditions in the Arrangement Agreement or Vendor Placing Agreement are not satisfied (or, where relevant, waived), or (ii) either the Arrangement Agreement or Vendor Placing Agreement is terminated or (iii) either the Arrangement Agreement or Vendor Placing Agreement does not otherwise become unconditional in all respects, the Placing of the Placing Shares will lapse and its rights and obligations hereunder shall cease and determine at such time and no claim shall be made by any Placee in respect thereof;

it acknowledges that no offering document, admission document or prospectus has been prepared in connection with the Placing and represents and warrants that it has not received and will not receive a prospectus, admission document or other offering document in connection therewith;

it acknowledges that the Existing Ordinary Shares are admitted to trading on AIM, and the Company is therefore required to publish certain business and financial information in accordance with the AIM Rules for Companies and EU Regulation 596/2014 (collectively "Exchange Information");

it acknowledges that none of Canaccord, Jefferies, the Company, any of their respective affiliates 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 other than this Announcement; nor has it requested any of Canaccord, Jefferies, the Company, any of their respective affiliates or any person acting on behalf of any of them to provide it with any such information;

it acknowledges that the content of this Announcement is exclusively the responsibility of the Company, and that none of Canaccord, Jefferies, their respective affiliates 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 any information previously or concurrently published by or on behalf of the Company, and will not be liable for any Placee's decision to participate in the Placing based on any information, representation or statement contained in this Announcement or otherwise. Each Placee further represents, warrants and agrees that the only information on which it is entitled to rely and on which such Placee has relied in committing itself to acquire the Placing Shares is contained in this Announcement and any Exchange Information, such information being all that it deems necessary to make an investment decision in respect of the Placing Shares and that it has neither received nor relied on any other information given or representations, warranties or statements made by any of Canaccord or Jefferies or the Company, or, if received, it has not relied upon any such information, representations, warranties or statements (including any management presentation that may have been received by any prospective Placee) and Canaccord nor Jefferies nor the Company will be liable for any Placee's decision to accept an invitation to participate in the Placing based on any other information, representation, warranty or statement. Each Placee further acknowledges and agrees that it has relied solely on its own investigation of the business, financial or other position of the Company in deciding to participate in the Placing and it will not rely on any investigation that Canaccord or Jefferies, their affiliates or any person acting on behalf of any of them has or may have conducted;

it represents and warrants that it has neither received nor relied on any unpublished price sensitive information concerning the Company in accepting this invitation to participate in the Placing;

it acknowledges that none of Canaccord or Jefferies, their affiliates or any person acting on behalf of any of them has or shall have any liability for the Exchange Information, any publicly available or filed 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;

it represents and warrants that it is acquiring the Placing Shares in an "offshore transaction" as defined in and pursuant Regulation S under the Securities Act;

it acknowledges that it is acquiring the Placing Shares for its own account or for one or more accounts for which, in each case, it exercises sole investment discretion, for investment purposes and not with a view to any distribution or for resale in connection with, the distribution thereof in whole or in part, in the United States and that it has full power to make the acknowledgements, representations and agreements herein on behalf of each such account;

it acknowledges that the Placing Shares have not been and will not be registered under the Securities Act or with any state or other jurisdiction of the United States, nor approved or disapproved by the US Securities and Exchange Commission, any state securities commission in the United States or any other United States regulatory authority, and agrees not to reoffer, resell, pledge or otherwise transfer the Placing Shares except pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act;

unless otherwise specifically agreed in writing with Canaccord or Jefferies, it represents and warrants that neither it nor the beneficial owner of such Placing Shares will be a resident of the United States, Australia, Canada, Japan or the Republic of South Africa;

it acknowledges that the Placing Shares have not been and will not be registered under the securities legislation of the United States, Australia, Canada, 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 those jurisdictions;

it represents and warrants that the issue to it, or the person specified by it for registration as holder, of Placing Shares will not give rise to a liability under any of sections 67, 70, 93 or 96 of the Finance Act 1986 (depositary receipts and clearance services) and that the Placing Shares are not being acquired in connection with arrangements to issue depositary receipts or to transfer Placing Shares into a clearance system;

it represents and warrants that: (i) 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 (as amended), the Terrorism Act 2006 and the Money Laundering, Terrorist Financing and Transfer of Funds (Information on the Payer) Regulations 2017 and (ii) it is not a person: (a) with whom transactions are prohibited under the Foreign Corrupt Practices Act of 1977 or any economic sanction programmes administered by, or regulations promulgated by, the Office of Foreign Assets Control of the U.S. Department of the Treasury; (b) named on the Consolidated List of Financial Sanctions Targets maintained by HM Treasury of the United Kingdom; or (c) subject to financial sanctions imposed pursuant to a regulation of the European Union or a regulation adopted by the United Nations (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 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 and has obtained all governmental and other consents (if any) which may be required for the purpose of, or as a consequence of, such purchase, and it will provide promptly to Canaccord or Jefferies such evidence, if any, as to the identity or location or legal status of any person which Canaccord or Jefferies may request from it in connection with the Placing (for the purpose of complying with such Regulations or ascertaining the nationality of any person or the jurisdiction(s) to which any person is subject or otherwise) in the form and manner requested by Canaccord or Jefferies on the basis that any failure by it to do so may result in the number of Placing Shares that are to be purchased by it or at its direction pursuant to the Placing being reduced to such number, or to nil, as Canaccord or Jefferies may decide at their discretion;

it represents and warrants that, to the extent it has received any inside information (for the purposes of MAR and section 56 of the Criminal Justice Act 1993) in relation to the Company and its securities, it has not: (a) dealt (or attempted to deal) in the securities of the Company; (b) encouraged, recommended or induced another person to deal in the securities of the Company; or (c) unlawfully disclosed inside information to any person, prior to the information being made publicly available;

it acknowledges that it has consented to receive information in respect of securities of the Company and other price-affected securities (as defined in the Financial Services and Markets Act 2000 ("FSMA")) which makes it an "insider" for the purposes of Part V of FSMA and MAR, and it agrees not to deal in any securities of the Company until such time as the inside information (as defined in FSMA) of which it has been made aware has been made public for purposes of FSMA or it has been notified by either of the Banks or the Company that the proposed Placing will not proceed and any unpublished price sensitive information of which it is aware has been publicly announced, and, other than in respect of its knowledge of the proposed Placing, it has neither received nor relied on any confidential price sensitive information concerning the Company or the Placing Shares; 

if it is a financial intermediary, as that term is used in Article 3(2) of the Prospectus Directive, it represents and warrants that the Placing Shares purchased 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 European Economic Area which has implemented the Prospectus Directive other than Qualified Investors, or in circumstances in which the prior consent of the Banks has been given to the offer or resale;

it represents and warrants that it has not offered or sold and, prior to the expiry of a period of six (6) months from Admission, will not offer or sell any Placing Shares to persons in the United Kingdom, 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 FSMA;

2.         it represents and warrants that it has not offered or sold and will not offer or sell any Placing Shares to persons in the European Economic Area prior to the Placing completing and the Placing Shares having been transferred to it and settled in its name, 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 in and which will not result in an offer to the public in any member state of the European Economic Area within the meaning of the Prospectus Directive;

3.         it represents and warrants that it has only communicated or caused to be communicated and 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 the Placing Shares in circumstances which do not require the approval of the communication by an authorised person under section 21(1) of the FSMA;

4.         it represents and warrants that it has complied and will comply with all applicable provisions of the FSMA with respect to anything done by it in relation to the Placing Shares in, from or otherwise involving, the United Kingdom;

5.         if in a Member State of the European Economic Area, unless otherwise specifically agreed with Canaccord or Jefferies in writing, it represents and warrants that it is a Qualified Investor within the meaning of the Prospectus Directive;

6.         if in the United Kingdom, it represents and warrants that it is a person: (i) who is an investment professionals within the meaning of Article 19(5) of the Order; (ii) who falls within Article 49(2)(A) to (D) ("High Net Worth Companies, Unincorporated Associations, etc.") of the Order; or (iii) to whom this Announcement may otherwise be lawfully communicated;

7.         it represents and warrants that it and any person acting on its behalf is entitled to acquire the Placing Shares under the laws of all relevant jurisdictions and that it has all necessary capacity and has obtained all necessary consents and authorities and taken any other necessary actions to enable it to commit to this participation in the Placing and to perform its obligations in relation thereto (including, without limitation, in the case of any person on whose behalf it is acting, all necessary consents and authorities to agree to the terms set out or referred to in this Announcement) and will honour such obligations;

8.         where it is acquiring Placing Shares for one or more managed accounts, it represents and warrants that it is authorised in writing by each managed account: (a) to acquire the Placing Shares for each managed account; (b) to make on its behalf the representations, warranties, acknowledgements, undertakings and agreements in this Appendix and the Announcement of which it forms part; and (c) to receive on its behalf any investment letter relating to the Placing in the form provided to you by Canaccord or Jefferies;

9.         it undertakes that it (and any person acting on its behalf) will make payment for the Placing Shares allocated to it in accordance with this Announcement on the due time and date set out herein, failing which the relevant Placing Shares may be placed with other Placees or purchasers as Canaccord or Jefferies may in their discretion determine and without liability to such 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 the liability for any stamp duty or stamp duty reserve tax or security transfer tax (together with any interest or penalties due pursuant to or referred to in these terms and conditions) which may arise upon the placing or sale of such Placee's Placing Shares on its behalf;

10.       it acknowledges that none of Canaccord, Jefferies, their respective affiliates, or 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 Placing and that participation in the Placing is on the basis that it is not and will not be treated for these purposes as a client of either Bank and that neither Bank has any duties or responsibilities to it for providing the protections afforded to their clients or customers or for providing advice in relation to the Placing nor in respect of any representations, warranties, undertakings or indemnities contained in the Arrangement Agreement or Vendor Placing Agreement or 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;

11.       it undertakes that the person whom it specifies for registration as the holder of the Placing Shares will be (i) itself or (ii) its nominee, as the case may be. Neither of the Bank 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 participate in the Placing and it agrees to indemnify the Company and each Bank in respect of the same on the basis that the Placing Shares will be delivered to the CREST stock account of the relevant Bank who will hold them as nominee on behalf of Livingbridge initially pending Admission and subsequently for each such Placee until settlement occurs in accordance with its standing settlement instructions;

12.       it acknowledges that these terms and conditions and any agreements entered into by it pursuant to these terms and conditions shall be governed by and construed in accordance with the laws of England and Wales and it submits (on behalf of itself and on behalf of any person on whose behalf it is acting) to the exclusive jurisdiction of the English courts as regards 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, Canaccord or Jefferies 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;

13.       it acknowledges that time shall be of the essence as regards to obligations pursuant to this Appendix to the Announcement;

14.       it agrees it will be bound by the terms of the Company's Articles of Association;

15.       it agrees that the Company, each Bank and their respective affiliates and others will rely upon the truth and accuracy of the foregoing representations, warranties, acknowledgements and undertakings which are given to each Bank on their own behalf and on behalf of the Company and are irrevocable and are irrevocably authorised to produce this Announcement or a copy thereof to any interested party in any administrative or legal proceeding or official inquiry with respect to the matters covered hereby;

16.       it agrees to indemnify on an after-tax basis and hold the Company, each Bank, and their respective affiliates 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 in this Appendix and further agrees that the provisions of this Appendix shall survive after completion of the Placing;

17.       it acknowledges that no action has been or will be taken by any of the Company, Canaccord, Jefferies or any person acting on behalf of the Company, Canaccord or Jefferies that would, or is intended to, permit a public offer of the Placing Shares in any country or jurisdiction where any such action for that purpose is required;

18.       it acknowledges that it is an institution that has knowledge and experience in financial, business and international investment matters as is required to evaluate the merits and risks of purchasing any 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 it, and any accounts for which it may be acting, are able to bear, the economic risk of, and is able to sustain, a complete loss in connection with the Placing. It has relied upon its own examination and due diligence of the Company and its associates taken as a whole, and the terms of the Placing, including the merits and risks involved; and

19.       it acknowledges that its commitment to purchase Placing Shares on the terms set out herein and in the trade confirmation or contract note will continue notwithstanding any amendment that may in future be made to the terms of the Placing and that Placees will have no right to be consulted or require that their consent be obtained with respect to the Company's conduct of the Placing.

The representations, warranties, acknowledgments and undertakings contained in this Appendix are given to Canaccord and Jefferies for themselves and on behalf of the Company and are irrevocable.

The agreement to settle a Placee's purchase (and/or the purchase by a person for whom such Placee is contracting as agent) free of stamp duty and stamp duty reserve tax depends on the settlement relating only to a purchase by it and/or such person direct from the Company for the Placing Shares in question. Such agreement assumes that the Placing Shares are not being purchased 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 relates to any other subsequent dealing in the Placing Shares, stamp duty or stamp duty reserve tax may be payable, for which neither the Company nor either Bank will be responsible, and the Placee to whom (or on behalf 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, transfer or delivery of Placing Shares has given rise to such UK stamp duty or stamp duty reserve tax undertakes to pay such UK stamp duty or stamp duty reserve tax forthwith and to indemnify on an after-tax basis and to hold harmless the Company, Canaccord and Jefferies in the event that any of the Company and/or Canaccord and/or Jefferies has incurred any such liability to UK stamp duty or stamp duty reserve tax. If this is the case, each Placee should seek its own advice and notify Canaccord or Jefferies accordingly.

In addition, Placees should note that they will be liable for any 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 UK by them or any other person on the purchase by them of any Placing Shares or the agreement by them to purchase any Placing Shares.

Each Placee, and any person acting on behalf of the Placee, acknowledges that neither Canaccord nor Jefferies owes any fiduciary or other duties to any Placee in respect of any representations, warranties, undertakings or indemnities in the Placing Agreement.

Each Placee and any person acting on behalf of the Placee acknowledges and agrees that Canaccord or Jefferies or any of their affiliates may, at their absolute discretion, agree to become a Placee in respect of some or all of the Placing Shares.

When a Placee or person acting on behalf of the Placee is dealing with Canaccord or Jefferies, any money held in an account with Canaccord or Jefferies 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 rules and regulations of the FCA made under the FSMA. The 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 Canaccord or Jefferies's money in accordance with the client money rules and will be used by Canaccord or Jefferies in the course of their own business and the Placee will rank only as a general creditor of Canaccord or Jefferies, as applicable.  

All times and dates in this Announcement may be subject to amendment. Canaccord or Jefferies shall notify the Placees and any person acting on behalf of the Placees of any changes.

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 and 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.

 

END

 

 

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