Regulatory News


THIS ANNOUNCEMENT, INCLUDING THE APPENDIX AND THE INFORMATION CONTAINED HEREIN, IS NOT FOR PUBLICATION, RELEASE OR DISTRIBUTION, DIRECTLY OR INDIRECTLY, IN WHOLE OR IN PART, IN OR INTO THE UNITED STATES OF AMERICA, AUSTRALIA, CANADA, JAPAN, THE REPUBLIC OF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

Acquisition and Placing

07 February 2017

Be Heard Group Plc (AIM: BHRD), the digital marketing services group, announces the proposed acquisition of a 75% stake in Freemavens Limited ("Freemavens") (the "Acquisition"), a marketing analytics and innovation consultancy specializing in the use of big data, for a total consideration of around £1.7m. The acquisition and associated costs are being funded via a cash placing to raise gross proceeds of £2.1m.

Founded in 2012 by Andrej Moyseowicz and Christopher Palengat, Freemavens is an analytics and innovation consultancy which aims to solve clients' business challenges and develop insights and actionable ideas using big data. The agency, with its 20-strong team, has developed several in-house data analytics tools and methodologies and has clients including Unilever, Barclays, Channel 4 and RNLI.

Freemavens will become Be Heard's fourth partner, and is the Group's first acquisition in data and analytics, which the Group believes is central to digital marketing and will become a core foundation of the Group as it delivers better, more cost efficient and more creative solutions to clients. For the financial year ended 31 December 2016 Freemavens delivered £1.72m gross revenue and £0.41m adjusted EBITDA.

Benefits of the Acquisition

The Board believes the Acquisition will provide a number of strategic and operational benefits which will create long-term value for shareholders. In particular:

  • The Directors of Be Heard see analytics as central to understanding and maximising return-on-investment in digital marketing.
  • The Acquisition provides an entry point for Be Heard into big data and analytics, and gives the Group a platform to develop advanced tools and services, to use big data in solving clients' business questions and developing insights and actionable ideas.
  • The Acquisition adds a fourth cornerstone of Strategy, innovation and analytics to the three already represented, i.e. Digital media planning and buying; UX, design and build; and Content and integrated creative. This rounds-off the Group's initial offering, creating a solid foundation on which to build
  • Freemavens is data agnostic, able to ingest and analyze many different data sources. This provides scope for further development and application across the Group.
  • Freemavens' clients include some well-known brands, which the Group intends to target for an expanded range of services from other Group companies following the Acquisition.
  • In addition to retaining a 25% stake in Freemavens, at completion its founders will own 9,303,766 Be Heard shares, aligning their interests with those of our existing shareholders.

Terms of the Acquisition

Be Heard will acquire 75% of Freemavens' equity for £0.84m, satisfied by the payment of £0.48m in cash and the issue of 9,303,766 new Be Heard shares (the "Consideration Shares"). As part of the Acquisition, Be Heard will also repay Freemavens' existing debt obligations of around £0.87m, due principally to the exiting majority shareholder Let's Go Crazy Limited, taking the total consideration to approximately £1.7m.

The remaining 25% of Freemavens' equity is being retained by its two founders, who are continuing with the business, and will be subject to a put and call option exercisable after four years, payable 50% in cash and 50% in new Be Heard shares, at a valuation of the lower of 2x historic revenue and 8x historic EBITDA. The maximum total consideration payable is £7.7m.

Completion of the Acquisition is conditional only upon completion of a cashbox placing, as described below.

The Placing

The Company has entered into a placing agreement with Numis (the "Placing Agreement"). Under the terms of the Placing Agreement, Numis has placed 58,300,000 new ordinary shares of one pence each in the Company (the "Placing Shares"), at a price of 3.6 pence per share (the "Placing Price") with new and existing investors, raising gross proceeds of £2.1m before expenses. The Placing has been fully underwritten by Numis in accordance with the terms of the Placing Agreement. The Placing Shares represent approximately 8.2 per cent of the Company's existing issued share capital (the "Placing").

Application has been made to the London Stock Exchange for the admission of the Placing Shares and the Consideration Shares (in aggregate, 67,603,766 new shares) to trading on AIM. Admission is expected to take place at 8.00am on 9 February 2017. The Company's total issued share capital following Admission will consist of 782,080,067 ordinary shares of one pence each with one voting right per share. The above figure of 782,080,067 may be used by shareholders as the denominator for the calculations by which they can determine if they are required to notify their interest in, or a change to their interest in, the Company following Admission.

The issue of the Placing Shares is to be effected by way of a cashbox placing. The Company will allot and issue the Placing Shares on a non-pre-emptive basis to the Placees in consideration for Numis transferring its holdings of ordinary shares and redeemable preference shares in Project Victoria Funding Limited, a Jersey company majority-owned by the Company ("JerseyCo"), to the Company. Accordingly, instead of receiving cash as consideration for the issue of the Placing Shares, at the conclusion of the Placing the Company will own the entire issued share capital of JerseyCo, whose only asset will be its cash reserves in an amount approximately equal to the net proceeds of the Placing.

The Placing is subject to the terms and conditions set out in the Appendix to this announcement.

This Announcement (including the Appendix) should be read in its entirety.

Bank Facilities

The Group has in place an uncommitted overdraft facility with Barclays, which it will utilise in the event of an unexpected downturn in trading occurring. Discussions are ongoing regarding putting in place a new term debt facility, in order to provide longer term debt funding as the Group continues to grow.

Related party transaction

The participation of Gresham House in the Placing, by virtue of it owning over 10% of the current issued share capital of the Company, constitutes a related party transaction for the purposes of AIM Rule 13. The Directors, having consulted with the Company's nominated adviser, Numis, consider that the terms of the related party transaction are fair and reasonable in so far as shareholders are concerned.

Current Trading

The Board is pleased to report that Group trading for the year ended 31 December 2016 was in line with its expectations.

Trading since the start of 2017 has begun well, with the integration of our third agency Kameleon (acquired in early December 2016) proceeding to plan. Significant new clients have been won across the group over the last six months and we are beginning to see the benefit to clients of the Group's ever broadening digital expertise.

Peter Scott, Executive Chairman of Be Heard said:

"The Freemavens team will give Be Heard industry leading analytics capability, and once bedded into our Group will augment and enhance the work we do for clients. Intelligent use of data underpins all decision making; our intention is to develop the analytics capability at Be Heard as a central function and resource for our clients. Bringing the exceptional Freemavens team into the fold is, I believe, a bold first step."

 

Christopher Palengat, Co-founder of Freemavens said:

"Be Heard offers the perfect opportunity to take what we have built in analytics and insight to the next level. The value they place on analytics, and the quality of the existing partner companies present enormous new opportunities for Freemavens. We can't wait to get started."

 

Enquiries

Be Heard Group plc
Peter Scott, Executive Chairman
Robin Price, Group Financial Director
020 3828 6269
   
Numis
Nick Westlake / Kevin Cruickshank (Nominated Advisor)
James Black (Corporate Broker)
020 7260 1000
   
Bell Pottinger (Financial PR)
Elly Williamson
Charlie Stewart
020 3772 2578

 

Certain information contained in this announcement would have constituted inside information (as defined by Article 7 of Regulation (EU) No 596/2014) prior to its release as part of this announcement.

Notes to Editors:

About Freemavens

Freemavens is an analytics and innovation consultancy which aims to solve clients' business questions and develop insights and actionable ideas using big data. Founded in 2012 by Christopher Palengat and Andrej Moyseowicz, Freemavens is data agnostic, being able to ingest and analyze many data sources, and has developed several in-house analytics tools and methodologies.

www.freemavens.com

@Freemavens

About Be Heard Group plc

Be Heard Group plc (AIM:BHRD) is a digital marketing services group operating at the intersection of marketing, technology and e-commerce. Our vision is to build an agile interconnected group focused on helping clients maximise their return-on-investment from digital marketing. To achieve this, we acquire and connect best-in-class companies spanning key digital disciplines, providing management experience, access to deeper resources and a strong platform for growth.

www.beheardgroup.com

@Be_Heard_Group

APPENDIX

TERMS AND CONDITIONS OF THE PLACING

THIS ANNOUNCEMENT, INCLUDING THIS APPENDIX (TOGETHER, THE "ANNOUNCEMENT") 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, CANADA, AUSTRALIA, JAPAN, THE REPUBLIC OF IRELAND 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. THESE TERMS AND CONDITIONS ARE FOR INFORMATION PURPOSES ONLY AND ARE DIRECTED ONLY AT PERSONS IN MEMBER STATES OF THE EUROPEAN ECONOMIC AREA WHO ARE QUALIFIED INVESTORS AS DEFINED IN SECTION 86(7) OF FSMA ("QUALIFIED INVESTORS") BEING PERSONS FALLING WITHIN THE MEANING OF ARTICLE 2(1)(E) OF THE PROSPECTUS DIRECTIVE; AND IN THE UNITED KINGDOM AT QUALIFIED INVESTORS WHO (I) HAVE PROFESSIONAL EXPERIENCE IN MATTERS RELATING TO INVESTMENTS FALLING WITHIN ARTICLE 19(5) OF THE FINANCIAL SERVICES AND MARKETS ACT 2000 (FINANCIAL PROMOTION) ORDER 2005 (THE "ORDER"); OR (II) FALL WITHIN ARTICLE 49(2)(A) TO (D) (HIGH NET WORTH COMPANIES, UNINCORPORATED ASSOCIATIONS, ETC) OF THE ORDER; OR (III) ARE PERSONS TO WHOM THEY MAY OTHERWISE BE LAWFULLY COMMUNICATED (ALL SUCH PERSONS TOGETHER BEING REFERRED TO AS "RELEVANT PERSONS"). THESE TERMS AND CONDITIONS MUST NOT BE ACTED ON OR RELIED ON BY PERSONS WHO ARE NOT RELEVANT PERSONS. ANY INVESTMENT OR INVESTMENT ACTIVITY TO WHICH THESE TERMS AND CONDITIONS RELATES IS AVAILABLE ONLY TO RELEVANT PERSONS AND WILL BE ENGAGED IN ONLY WITH RELEVANT PERSONS.

THE ANNOUNCEMENT IS FOR INFORMATION PURPOSES ONLY AND DOES NOT ITSELF CONSTITUTE AN OFFER FOR SALE OR SUBSCRIPTION OF ANY SECURITIES IN THE COMPANY. THE ANNOUNCEMENT HAS BEEN ISSUED BY AND IS THE SOLE RESPONSIBILITY OF THE COMPANY.

THE ANNOUNCEMENT IS NOT AN OFFER FOR SALE OR SUBSCRIPTION IN ANY JURISDICTION IN WHICH SUCH OFFER, SOLICITATION OR SALE WOULD BE UNLAWFUL UNDER THE SECURITIES LAWS OF ANY SUCH JURISDICTION. THE 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 EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT. NEITHER THE UNITED STATES SECURITIES AND EXCHANGE COMMISSION NOR ANY SECURITIES REGULATORY AUTHORITY OF ANY STATE OR OTHER JURISDICTION OF THE UNITED STATES HAS APPROVED OR DISAPPROVED OF AN INVESTMENT IN THE SECURITIES OR PASSED UPON OR ENDORSED THE MERITS OF THE PLACING OR THE ACCURACY OR ADEQUACY OF THE CONTENTS OF THIS ANNOUNCEMENT. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENCE IN THE UNITED STATES. NO PUBLIC 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 subscribe for 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 Placee represents, warrants and acknowledges 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 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 ("EEA") which has implemented the Prospectus Directive other than Qualified Investors or in circumstances in which the prior consent of Numis 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; and
  3. a) it is not (i) in the United States and (ii) acting for the account or benefit of a person in the United States, or (b) it is a dealer or other professional fiduciary in the United States acting on a discretionary basis for a non-US person (other than an estate or trust) in reliance on Regulation S under the Securities Act; or (c) it is otherwise acquiring the Placing Shares in an "offshore transaction" meeting the requirements of Regulation S under the Securities Act; and
  4. it is not, and is not acting for the account or benefit of a person who is, a national of Canada, Australia, Japan or the Republic of South Africa.

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

This Announcement has been prepared and issued by the Company and is and will be 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 Numis or any of its directors, officers, employees, affiliates, branches, advisers, consultants or agents or any other person as to or in relation to, the accuracy or completeness of the Announcement or any other written or oral information made available to or publicly available to any Placee, any person acting on such Placee's behalf or any of their respective advisers, and any liability therefor is expressly disclaimed.

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 buy or subscribe for 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, Canada, Australia, Japan or the Republic of South Africa or in any 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 outside the United States in accordance with Regulation S under the Securities Act.

No securities commission or similar authority in Canada has in any way passed on the merits of the securities offered hereunder and any representation to the contrary is an offence. No document in relation to the Placing has been, or will be, lodged with, or registered by the Australian Securities and Investments Commission, and no registration statement has been, or will be, filed with the Japanese Ministry of Finance in relation to the Placing or the Shares. Accordingly, subject to certain exceptions, the Shares may not, directly or indirectly, be offered or sold within Canada, Australia, Japan, the Republic of South Africa or the Republic of Ireland or offered or sold to a resident of Canada, Australia, Japan, the Republic of South Africa or the Republic of Ireland. The shares to be subscribed in the Placing have not been, and will not be, registered under the Securities Act or with any securities regulatory authority of any state or other jurisdiction of the United States and may not be offered or sold within the United States or to, or for the account or benefit of, any US Person as that term is defined in Regulation S under the Securities Act, except pursuant to an exemption from, or in a transaction not subject to the registration requirements of the Securities Act. The Company has not been registered and will not register under the United States Investment Company Act of 1940, as amended.

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.

In this Appendix, unless the context otherwise requires, "Placee" means a Relevant Person (including individuals, funds or otherwise) by whom or on whose behalf a commitment to subscribe for Placing Shares has been given.

DETAILS OF THE PLACING AGREEMENT AND THE PLACING SHARES

The Company has today entered into a placing agreement (the "Placing Agreement") with Numis. Pursuant to the Placing Agreement, Numis has, subject to the terms set out therein, agreed to use reasonable endeavours, as agent of the Company, to procure Placees for the Placing Shares (the "Placing") at a price of 3.6 pence per Placing Share (the "Placing Price").

In accordance with the terms of the Placing Agreement and a subscription and transfer agreement between the Company, Numis and a Jersey incorporated subsidiary of the Company ("Jersey SPV") (the "Subscription and Transfer Agreement"), the allotment and issue of the Placing Shares to Placees by the Company will be in consideration for the transfer to the Company of certain shares in Jersey SPV by Numis.

The Placing Shares will, when issued be subject to the articles of association of the Company, be credited as fully paid and will rank pari passu in all respects with each other and with the existing ordinary shares in the capital of the Company ("Ordinary Shares"), including the right to receive all dividends and other distributions declared, made or paid in respect of the Ordinary Shares after the date of issue of the Placing Shares. The Placing Shares will be issued free of any encumbrance, lien or other security interest.

APPLICATION FOR ADMISSION

Application will be made to AIM for admission of the Placing Shares to trading on AIM. It is expected that Admission will become effective on or around 8.00 a.m. on 9 February 2017 and that dealings in the Placing Shares will commence at that time.

PARTICIPATION IN, AND PRINCIPAL TERMS OF, THE PLACING

Numis (whether through itself or any of its affiliates) is arranging the Placing as broker to the Company for the purpose of using reasonable endeavours to procure Placees at the Placing Price for the Placing Shares. Participation in the Placing will only be available to persons who may lawfully be, and are, invited to participate by Numis. Numis and its affiliates may participate in the Placing as principal(s).

Each Placee which confirms its agreement to Numis (whether orally or in writing) to subscribe for Placing Shares hereby agrees with Numis that it will be bound by these terms and conditions and will be deemed to have irrevocably accepted them.

A commitment to subscribe for Placing Shares which has been communicated by a prospective Placee to Numis and which has not been withdrawn or revoked prior to publication of this announcement shall not be capable of withdrawal or revocation following the publication of this announcement without the consent of Numis.

Each Placee's allocation will be confirmed to Placees orally or in writing by Numis, and a trade confirmation or contract note will be despatched as soon as practicable thereafter. The 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 Numis and the Company, under which it agrees to acquire the number of Placing Shares allocated to it at the Placing Price on these terms and conditions and in accordance with the Company's Articles of Association.

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".

All obligations under the Placing will be subject to fulfilment or (where applicable) waiver of amongst other things, 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 under the Placing Agreement".

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. Each Placee's obligations will be owed to the Company and to Numis. Following the oral confirmation referred to above, each Placee will also have an immediate, separate, irrevocable and binding obligation, owed to the Company and Numis as agent of the Company, to pay to Numis in cleared funds an amount equal to the product of the Placing Price and the number of Placing Shares such Placee has agreed to acquire. Numis will procure the allotment of the Placing Shares to each Placee.

To the fullest extent permissible by law, none of Numis, any holding company thereof, any subsidiary thereof, any subsidiary of any such holding company, any branch, affiliate or associated undertaking of any such company nor any of their respective directors, officers and employees (each an "Affiliate") nor any person acting on their behalf shall have any liability to Placees (or to any other person whether acting on behalf of a Placee or otherwise).

Each Placee acknowledges and agrees that the Company is responsible for the allotment of the Placing Shares to the Placees and Numis shall have no liability to the Placees for the failure of the Company to fulfil those obligations. No commissions will be paid to Placees or by Placees in respect of any Placing Shares.

All obligations of Numis under the Placing will be subject to fulfilment of the conditions referred to below under "Conditions of 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 Numis under the Placing Agreement are conditional, inter alia, on:

(a) the performance by the Company of its obligations under the Placing Agreement to the extent that they fall to be performed prior to Admission;

(b) the Acquisition Agreement (i) not having been terminated or, without the prior written consent of Numis, varied or amended and (ii) having become unconditional in all respects, save for any condition relating to this Agreement becoming unconditional in accordance with its terms (including, for the avoidance of doubt, Admission);

(c) the Placing Agreement not having been terminated in accordance with its terms; and

(d) Admission occurring not later than 8.00 a.m. on 9 February 2017 or such later time as Numis may agree in writing with the Company (but in any event not later than 8.00 a.m. on 13 February 2017).

If (a) the conditions are not fulfilled (or to the extent permitted under the Placing Agreement waived by Numis), or (b) the Placing Agreement is terminated in the circumstances specified below, the Placing will lapse and each Placee's rights and obligations hereunder shall cease and determine at such time and no claim may be made by a Placee in respect thereof. None of Numis, the Company, nor any of their respective Affiliates 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 it may make as to whether or not to waive or to extend the time and/or date for the satisfaction of any condition in the Placing Agreement or in respect of the Placing generally.

By participating in the Placing, each Placee agrees that its rights and obligations hereunder terminate only in the circumstances described below under "Right to terminate under the Placing Agreement", and will not be capable of rescission or termination by the Placee.

RIGHT TO TERMINATE UNDER THE PLACING AGREEMENT

Numis may, at any time before Admission, terminate the Placing Agreement by giving notice to the Company if, inter alia:

(a) it comes to the knowledge of Numis that any of the warranties was untrue or inaccurate in any respect which Numis considers to be material; or

(b) it comes to the notice of Numis that any statement contained in this announcement is or has become untrue, incorrect or misleading in any respect or is misleading or that any matter has arisen which would, if the Placing were made at that time, constitute an inaccuracy or omission therefrom and which Numis considers (acting in good faith) to be material; or

(c) it comes to the notice of Numis that a matter has arisen which is likely to give rise to a claim under any of the indemnities given by the Company; or

(d) the Company or Jersey SPV shall fail to comply, in any material respect with any of its obligations under the Placing Agreement or the Subscription and Transfer Agreement, as applicable; or

(e) there has occurred a force majeure event which would make it inadvisable or impracticable to proceed with the placing or any material adverse change has occurred in the financial position or prospects or business of the Company and its subsidiary undertakings (taken as whole) which, in the opinion of Numis, would materially prejudice the success of the Placing.

By participating in the Placing, each Placee agrees with Numis that the exercise by Numis of any right of termination or other discretion under the Placing Agreement shall be within the absolute discretion of Numis without the need to make any reference to the Placees in this regard and that, to the fullest extent permitted by law, Numis shall not have any liability whatsoever to the Placees in connection with any such exercise.

NO PROSPECTUS

No offering document or prospectus has been or will be prepared in relation to the Placing and no such prospectus is required (in accordance with the Prospectus Directive) to be published and Placees' commitments will be made solely on the basis of the information contained in this document and any information previously published by or on behalf of the Company by notification to a Regulatory Information Service (as defined in the AIM Rules). Each Placee, by accepting a participation in the Placing, agrees that the content of this document is exclusively the responsibility of the Company and confirms to Numis and the Company that it has neither received nor relied on any information, representation, warranty or statement made by or on behalf of Numis (other than the amount of the relevant Placing participation in the oral confirmation given to Placees and the trade confirmation referred to below), any of their respective Affiliates, any persons acting on its behalf or the Company and none of Numis any of its respective Affiliates, any persons acting on their behalf, nor the Company will be liable for the decision of any Placee to participate in the Placing based on any other information, representation, warranty or statement which the Placee may have obtained or received (regardless of whether or not such information, representation, warranty or statement was given or made by or on behalf of any such persons). By participating in the Placing, each Placee acknowledges to and agrees with Numis for itself and as agent for the Company that, except in relation to the information contained in this document, it has relied on its own investigation of the business, financial or other position of the Company in deciding to participate in the Placing. 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 GB00BT6SJV45) following Admission will take place within the CREST system, using the DVP mechanism, subject to certain exceptions. Numis reserves the right to require settlement for and delivery of the Placing Shares to Placees by such other means that they deem necessary, if delivery or settlement is not possible or practicable within the CREST system within the timetable set out in this document or would not be consistent with the regulatory requirements in the Placee's jurisdiction.

Each Placee allocated Placing Shares in the Placing will be sent a trade confirmation stating the number of Placing Shares allocated to it, the Placing Price, the aggregate amount owed by such Placee to Numis and settlement instructions. It is expected that such trade confirmation will be despatched on 7 February 2017 and that this will also be the trade date. 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 which it has in place with Numis.

It is expected that settlement will be on 9 February 2017 on a DVP basis in accordance with the instructions set out in the trade confirmation unless otherwise notified by Numis.

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 percentage points above the base rate of Barclays Bank Plc.

Each Placee is deemed to agree that if it does not comply with these obligations, Numis may sell any or all of the Placing Shares allocated to the Placee on such Placee's behalf and retain from the proceeds, for Numis' own account and profit, an amount equal to the aggregate amount owed by the Placee plus any interest due. The Placee will, however, remain liable for any shortfall below the aggregate amount owed by such Placee and it may be required to bear any stamp duty or stamp duty reserve tax (together with any interest or penalties) which may arise upon the sale of such Placing Shares on such Placee's behalf.

If Placing Shares are to be delivered to a custodian or settlement agent, the Placee should ensure that the trade confirmation is copied and delivered immediately to the relevant person within that organisation.

Insofar as Placing Shares are registered in the Placee's name or that of its nominee or in the name of any person for whom the Placee is contracting as agent or that of a nominee for such person, such Placing Shares will, subject as provided below, be so registered free from any liability to PTM levy, stamp duty or stamp duty reserve tax. If there are any circumstances in which any other stamp duty or stamp duty reserve tax is payable in respect of the issue of the Placing Shares, neither Numis nor the Company shall be responsible for the payment thereof. Placees will not be entitled to receive any fee or commission in connection with the Placing.

REPRESENTATIONS AND WARRANTIES

By receiving this document, each Placee and, to the extent applicable, any person confirming his agreement to acquire Placing Shares on behalf of a Placee or authorising Numis to notify a Placee's name to the Company's registrar, Share Registrars Limited (in this Appendix, the "Registrar"), is deemed to acknowledge, agree, undertake, represent and warrant to each of Numis, the Registrar and the Company that:

(a) the Placee has read this document in its entirety and acknowledges that its participation in the Placing shall be made solely on the terms and subject to the conditions set out in these terms and conditions, the Placing Agreement and the Articles. Such Placee agrees that these terms and conditions and the contract note issued by Numis to such Placee represent the whole and only agreement between the Placee, Numis and the Company in relation to the Placee's participation in the Placing and supersedes any previous agreement between any of such parties in relation to such participation. Accordingly, all other terms, conditions, representations, warranties and other statements which would otherwise be implied (by law or otherwise) shall not form part of these terms and conditions. Such Placee agrees that none of the Company, Numis nor any of their respective officers or directors will have any liability for any such other information or representation and irrevocably and unconditionally waives any rights it may have in respect of any such other information or representation;

(b) if the Placee is a natural person, such Placee is not under the age of majority (18 years of age in the UK) on the date of such Placee's agreement to acquire Placing Shares under the Placing and will not be any such person on the date any such offer is accepted;

(c) neither Numis nor any person affiliated with Numis or acting on its behalf is responsible for or shall have any liability for any information, representation or statement contained in this document or any supplementary admission document (as the case may be) or any information previously published by or on behalf of the Company or any member of the Group and will not be liable for any decision by a Placee to participate in the Placing based on any information, representation or statement contained in this document or otherwise;

(d) the Placee has not relied on Numis or any person affiliated with Numis in connection with any investigation of the accuracy of any information contained in this document or their investment decision;

(e) in agreeing to acquire Placing Shares under the Placing, the Placee is relying on this document or any supplementary admission document (as the case may be) and not on any other information or representation concerning the Group, the Placing or the Placing Shares. Such Placee agrees that neither the Company nor Numis nor their respective officers, directors, employees or affiliates will have any liability for any such other information or representation and irrevocably and unconditionally waives any rights it may have in respect of any such other information or representation;

(f) save in the event of fraud on its part (and to the extent permitted by the rules of the FCA), neither Numis nor any of its officers, directors, employees or affiliates shall be liable to a Placee for any matter arising out of the role of Numis as the Company's nominated adviser and broker or otherwise, and that where any such liability nevertheless arises as a matter of law each Placee will immediately waive any claim against Numis and any of its directors and employees which a Placee may have in respect thereof;

(g) the Placee has complied with all applicable laws and such Placee will not infringe any applicable law as a result of such Placee's agreement to acquire Placing Shares under the Placing and/or acceptance thereof or any actions arising from such Placee's rights and obligations under the Placee's agreement to acquire Placing Shares under the Placing and/or acceptance thereof or under the Articles;

(h) all actions, conditions and things required to be taken, fulfilled and done (including the obtaining of necessary consents) in order (i) to enable the Placee lawfully to enter into, and exercise its rights and perform and comply with its obligations to acquire the Placing Shares under, the Placing and (ii) to ensure that those obligations are legally binding and enforceable, have been taken, fulfilled and done. The Placee's entry into, exercise of its rights and/or performance under, or compliance with its obligations under the Placing, does not and will not violate (a) its constitutive documents or (b) any agreement to which the Placee is a party or which is binding on the Placee or its assets;

(i) it understands that no action has been or will be taken in any jurisdiction by the Company or Numis or any other person that would permit a public offering of the Placing Shares, or possession or distribution of this document, in any country or jurisdiction where action for that purpose is required; and that, if the Placee is in a member state of the European Economic Area which has implemented the Prospectus Directive ("Relevant Member State"), it is (i) a legal entity which is authorised or regulated to operate in the financial markets or, if not so authorised or regulated, its corporate purpose is solely to invest in securities; (ii) a legal entity which has two or more of (a) a total balance sheet of more than €20,000,000; (b) an annual net turnover of more than €40,000,000; or (c) own funds in excess of €2,000,000; in each case as shown in its last annual or consolidated accounts; (iii) otherwise permitted by law to be offered and sold Placing Shares in circumstances which do not require the publication by the Company of a prospectus pursuant to Article 3 of the Prospectus Directive or other applicable laws; or (iv) in the case of any Placing Shares acquired by a Placee as a financial intermediary, as that term is used in Article 3(2) of the Prospectus Directive either:

(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 placing or resale to, persons in any Relevant Member State other than qualified investors, as that term is defined in the Prospectus Directive or in circumstances in which the prior consent of Numis has been given to the placing or resale; or

(ii) where Placing Shares have been acquired by it on behalf of persons in any Relevant Member State other than qualified investors, the placing of those Placing Shares to it is not treated under the Prospectus Directive as having been made to such persons;

(j) to the fullest extent permitted by law, the Placee acknowledges and agrees to the disclaimers contained in this document and acknowledges and agrees to comply with the selling restrictions set out in this document;

(k) the Ordinary Shares have not been and will not be registered under the Securities Act, or under the securities legislation of, or with any securities regulatory authority of, any state or other jurisdiction of the United States or under the applicable securities laws of Canada, Australia, the Republic of Ireland, the Republic of South Africa or Japan or where to do so may contravene local securities laws or regulations;

(l) the Placee is not a person located in the United States and is eligible to participate in an "offshore transaction" as defined in and in accordance with Regulation S of the Securities Act and the Placing Shares were not offered to such Placee by means of "directed selling efforts" as defined in Regulation S of the Securities Act;

(m) it is acquiring the Placing Shares for investment purposes only and not with a view to any resale, distribution or other disposition of the Placing Shares in violation of the US Securities Act or any other United States federal or applicable state securities laws;

(n) the Company is not obliged to file any registration statement in respect of resales of the Placing Shares in the United States with the U.S. Securities and Exchange Commission or with any state securities administrator;

(o) the Company, and any registrar or transfer agent or other agent of the Company, will not be required to accept the registration of transfer of any Placing Shares acquired by the Placee, except upon presentation of evidence satisfactory to the Company that the foregoing restrictions on transfer have been complied with;

(p) the Placee invests in or purchases securities similar to the Placing Shares in the normal course of its business and it has such knowledge and experience in financial and business matters as to be capable of evaluating the merits and risks of an investment in the Placing Shares;

(q) the Placee has conducted its own investigation with respect to the Company and the Placing Shares and has had access to such financial and other information concerning the Company and the Placing Shares as the Placee deemed necessary to evaluate the merits and risks of an investment in the Placing Shares, and the Placee has concluded that an investment in the Placing Shares is suitable for it or, where the Placee is not acting as principal, for any beneficial owner of the Placing Shares, based upon each such person's investment objectives and financial requirements;

(r) the Placee or, where the Placee is not acting as principal, any beneficial owner of the Placing Shares, is able to bear the economic risk of an investment in the Placing Shares for an indefinite period and the loss of its entire investment in the Placing Shares;

(s) there may be adverse consequences to the Placee under United States and other tax laws resulting from an investment in the Placing Shares and the Placee has made such investigation and has consulted such tax and other advisors with respect thereto as it deems necessary or appropriate;

(t) the Placee is not a resident of the United States, Canada, Australia, the Republic of South Africa, the Republic of Ireland or Japan and acknowledges that the Placing Shares have not been and will not be registered nor will a prospectus be prepared in respect of the Placing Shares under the securities legislation of the United States, Canada, Australia, the Republic of South Africa, the Republic of Ireland or Japan and, subject to certain exceptions, the Placing Shares may not be offered or sold, directly or indirectly, in or into those jurisdictions or in any other jurisdiction in which any such offer, invitation or solicitation is or would be unlawful;

(u) the Placee is 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 UK by it or any other person on the acquisition by it of any Placing Shares or the agreement by it to acquire any Placing Shares;

(v) in the case of a person who confirms to Numis on behalf of a Placee an agreement to acquire Placing Shares under the Placing and/or who authorises Numis to notify such Placee's name to the Registrar, that person represents and warrants that he has authority to do so on behalf of the Placee;

(w) the Placee has complied with its obligations in connection with money laundering and terrorist financing under the Proceeds of Crime Act 2002, the Terrorism Act 2000 and the Money Laundering Regulations 2007 and any other applicable law concerning the prevention of money laundering and, if it is 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 Money Laundering Regulations 2007 and, in each case, agrees that pending satisfaction of such obligations, definitive certificates (or allocation under the CREST system) in respect of the Placing Shares comprising the Placee's allocation may be retained at Numis' discretion;

(x) the Placee agrees that, due to anti-money laundering and the countering of terrorist financing requirements, Numis and/or the Company may require proof of identity of the Placee and related parties and verification of the source of the payment before the application can be processed and that, in the event of delay or failure by the Placee to produce any information required for verification purposes, Numis and/or the Company may refuse to accept the application and the subscription moneys relating thereto. It holds harmless and will indemnify Numis and/or the Company against any liability, loss or cost ensuing due to the failure to process this application, if such information as has been required has not been provided by it or has not been provided on a timely basis;

(y) the Placee is not, and is not applying as nominee or agent for, a person which is, or may be, mentioned in any of sections 67, 70, 93 and 96 of the Finance Act 1986 (depository receipts and clearance services);

(z) the Placee has complied with and will comply with all applicable provisions of FSMA with respect to anything done by the Placee in relation to the Placing in, from or otherwise involving the UK;

(aa) if the Placee is in the UK, the Placee is a person (i) who has professional experience in matters relating to investments falling within article 19(5) of the Order or (ii) a high net worth entity falling within article 49(2)(a) to (d) of the Order, or is a person to whom this document may otherwise be lawfully communicated, and in all cases is capable of being categorised as a Professional Client or Eligible Counterparty for the purposes of the FCA Conduct of Business Rules (all such persons together being referred to as "relevant persons");

(bb) if the Placee is in the European Economic Area, the person is a "Professional Client/Eligible Counterparty" within the meaning of Annex II/Article 24 (2) of MiFID and is not participating in the Placing on behalf of persons in the European Economic Area other than Professional Clients or persons in the UK and other member states (where equivalent legislation exists) for whom the Placee has authority to make decisions on a wholly discretionary basis as above;

(cc) in the case of a person who confirms to Numis on behalf of a Placee an agreement to acquire Placing Shares under the Placing and who is acting on behalf of a third party, that the terms on which the Placee (or any person acting on its behalf) are engaged enable it to make investment decisions in relation to securities on that third party's behalf without reference to that third party;

(dd) Numis is not making any recommendation to the Placee or advising the Placee regarding the suitability or merits of participation in the Placing or any transaction the Placee may enter into in connection with the Placing or otherwise. The Placee is not Numis' client in connection with the Placing and Numis will not be responsible to any Placee for providing the protections afforded to Numis' clients or providing advice in relation to the Placing and Numis will not have any duties or responsibilities to any Placee similar or comparable to "best execution" and "suitability" imposed by the Conduct of Business Sourcebook contained in the rules of the FCA;

(ee) the exercise by Numis of any rights or discretions under the Placing Agreement shall be within its absolute discretion and Numis need not have any reference to any Placee and shall have no liability to any Placee whatsoever in connection with any decision to exercise or not to exercise or to waive any such right and each Placee agrees that it shall have no rights against Numis or its directors or employees under the Placing Agreement;

(ff) the Placee's commitment to acquire Placing Shares on the terms set out herein 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;

(gg) it irrevocably appoints any director of Numis as its agent for the purposes of executing and delivering to the Company and/or the Registrar any documents on its behalf necessary to enable it to be registered as the holder of any of the Placing Shares agreed to be taken up by it under the Placing and otherwise to do all acts, matters and things as may be necessary for, or incidental to, its acquisition of any Placing Shares in the event of its failure so to do; and

(hh) it will indemnify and hold the Company and Numis 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 Part V and further agrees that the provisions of this Part V will survive after completion of the Placing. The Company and Numis will rely upon the truth and accuracy of each of the foregoing representations, warranties and undertakings.

SUPPLY AND DISCLOSURE OF INFORMATION

If any of Numis, the Registrar or the Company or any of their respective agents request any information about a Placee's agreement to acquire Placing Shares, such Placee must promptly disclose it to them.

MISCELLANEOUS

The rights and remedies of Numis, the Registrar and the Company under these terms and conditions are in addition to any rights and remedies which would otherwise be available to each of them and the exercise or partial exercise of one will not prevent the exercise of others.

On application, each Placee may be asked to disclose, in writing or orally to Numis:

(a) if he is an individual, his nationality; or

(b) if he is a discretionary fund manager, the jurisdiction in which the funds are managed or owned.

All documents will be sent at the Placee's risk. They may be sent by post to such Placee at an address notified to Numis. Each Placee agrees to be bound by the Articles once the Placing Shares which such Placee has agreed to acquire have been acquired by such Placee. The provisions of this Part V may be waived, varied or modified as regards specific Placees or on a general basis by Numis. The contract to acquire Placing Shares and the appointments and authorities mentioned herein will be governed by, and construed in accordance with, the laws of England and Wales. For the exclusive benefit of Numis, the Company and the Registrar, each Placee irrevocably submits to the exclusive jurisdiction of the English courts in respect of these matters. This does not prevent an action being taken against a Placee in any other jurisdiction. In the case of a joint agreement to acquire Placing Shares, references to an "Placee" in these terms and conditions are to each of such Placees and such joint Placees' liability is joint and several. All times and dates in this document are subject to amendment and Numis and the Company each expressly reserve the right to modify the Placing (including, without limitation, its timetable and settlement) at any time before allocations of Placing Shares under the Placing are determined.

The Placing is subject to the satisfaction of the conditions contained in the Placing Agreement and the Placing Agreement not having been terminated. Further details of the terms of the Placing Agreement are set out above.

DEFINITIONS USED IN THIS ANNOUNCEMENT

"Acquisition" means the acquisition by the Company of 67 A ordinary shares of £1 each and 71 B ordinary shares of £1 each in the capital of Target representing 75% of the issued share capital of Target at the date of this agreement;

"Acquisition Agreement" means the conditional agreement dated 6 February 2017 between (1) the shareholders of Target (as Sellers and/or Warrantors, as defined therein) and (2) the Company relating to the Acquisition;

"Admission" means admission of the Consideration Shares and the Placing Shares to trading on AIM becoming effective in accordance with the AIM Rules ;

"AIM" the market of that name operated by the London Stock Exchange;

"AIM Rules" the AIM Rules for Companies;

"Business Day" a day (excluding Saturdays, Sundays or public holidays in England and Wales) on which banks generally are open in London for the transaction of business;

"certificated" or "in certificated form" where a security is not held in uncertificated form (i.e. not in CREST);

"Company" Be Heard Group plc;

"Consideration Shares" means the 9,303,766 new Ordinary Shares to be issued to those persons who were shareholders of Target immediately prior to completion of the Acquisition as part consideration for the sale of shares in Target by them pursuant to and in accordance with the terms of the Acquisition Agreement;

"CREST" the relevant system (as defined in the CREST Regulations) in respect of which Euroclear is the Operator (as defined in the CREST Regulations);

"CREST Regulations" the Uncertificated Securities Regulations 2001 (SI 2001/3755);

"Directors" the directors of the Company;

"Euroclear" Euroclear UK & Ireland Limited, the operator of CREST;

"FCA" the Financial Conduct Authority of the United Kingdom;

"FSMA" the Financial Services and Markets Act 2000 (as amended);

"Group" the Company and its subsidiary undertakings;

"London Stock Exchange" London Stock Exchange plc;

"Numis" Numis Securities Limited, registered in England and Wales with number 2285918, whose registered office is at 10 Paternoster Square, London EC4M 7LT;

"Ordinary Shares" the ordinary shares of £0.01 in the capital of the Company;

"Placees" the placees procured by Numis pursuant to the Placing Agreement who agree to subscribe for the Placing Shares;

"Placing" the placing of Placing Shares as described in this document;

"Placing Agreement" the agreement relating to the Placing dated 6 February 2017 between the Company and Numis;

"Placing Price" 3.6 pence per Placing Share;

"Placing Shares" the 58,300,000 new Ordinary Shares to be issued pursuant to the Placing;

"Prospectus Directive" the Directive of the European Parliament and of the Council of the European Union 2003/71/EC;

"Regulation S" Regulation S under the Securities Act;

"Securities Act" the US Securities Act of 1933, as amended;

"Shareholders" holders of Ordinary Shares;

"Target" means Freemavens Limited (company registration number 8269001) whose registered office is at 3 Loughborough Street, London, SE11 5RB;

"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 CREST;

"United Kingdom" or "UK" the United Kingdom of Great Britain and Northern Ireland; and

"United States" or "US" the United States of America, its territories and possessions and the District of Columbia.

 

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