REG-One Media iP Group Plc: Placing to Raise £6 million and Notice of GM
18/08/2020 07:05
The information contained within this announcement is deemed by the Company to
constitute inside information as stipulated under the Market Abuse Regulations
(EU) No. 596/2014. Upon the publication of this announcement via a Regulatory
Information Service ("RIS"), this inside information is now considered to be
in the public domain.
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CONTAIN ANY INVITATION, SOLICITATION, RECOMMENDATION, OFFER OR ADVICE TO ANY
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18 August 2020
One Media iP Group plc
("One Media" the "Company")
Placing to Raise £6 million;
and
Notice of General Meeting
One Media iP Group Plc (AIM: OMIP), the digital music rights acquirer,
publisher and digital distributor, is pleased to announce that it has
conditionally raised £6.04 million by the way of a firm placing of 20,284,000
new Ordinary Shares (the “Firm Placing”) and conditional placing of
66,058,550 new Ordinary Shares (the “Conditional Placing” and together
with the Firm Placing, the “Placing”) at 7.0 pence per Ordinary Share. The
Placing has been arranged by Cenkos Securities and the Placing Shares will
rank, pari passu, in all other respects with the Company's Existing Ordinary
Shares.
Placing Highlights
· Placing to raise £6.04 million through the conditional issue
of 86,342,550 Placing Shares to new and existing institutional and other
investors at 7.0 pence per Placing Share.
· The Placing Price equates to a 3.4 per cent. discount to the
closing mid-market price of 7.25 pence on 17 August 2020.
· Placing Shares represent 38.9 per cent. of the Enlarged Share
Capital.
Use of proceeds
The net proceeds of the Placing of £5.6 million will be used by the Company
to fund the acquisition of exclusive rights to create and expand the Digital
Assets over a portion of copyrights in performance and writers shares,
primarily through the Harmony iP asset release program.
Firm Placing and Admission of Shares
The Firm Placing of 20,284,000 Ordinary Shares is within the Company’s
existing authorities. As such application for the admission of the shares has
been made to AIM, with admission expected to take place on 20 August 2020.
General Meeting
The Conditional Placing is conditional, inter alia, upon Shareholder approval
at the General Meeting of the Company which will be held electronically at
11.00 a.m. on 4 September 2020.
In light of the ongoing Coronavirus pandemic and with a view to taking
appropriate measures to safeguard its shareholders' health and make the
General Meeting as safe and efficient as possible, the Company is invoking
certain of the provisions of the Articles to hold the General Meeting as an
electronic meeting only.
Should Shareholders wish to ask any questions in relation to the Placing or
the Resolutions, which they may otherwise have asked at the General Meeting
had they been in attendance, they are encouraged to contact the Company prior
to the General Meeting by email to the Company Secretary at AGM@onemediaip.com
with the subject line “GM Question”.
The Company will shortly be posting a Notice of General Meeting and an
accompanying circular (the “Circular”) to existing shareholders following
this announcement. All relevant documents will also be available to download
from the Company website at omip.co.uk/investor-relations/.
Subject to, inter alia, the passing of the Resolutions at the General Meeting,
51,144,000 Ordinary Shares (Second Admission) are expected to be admitted to
trading on AIM on or around 8.00 a.m. on 8 September 2020 and 14,914,550
Ordinary Shares (Third Admission) are expected to be admitted to trading on
AIM on or around 8.00 a.m. on 9 September 2020.
One Media CEO, Michael Infante said:
"To have such a heavily oversubscribed fundraising, which also brings a
significant number of new high-quality investors onto the register, is
extremely pleasing. The level of demand for the Placing reflects the
confidence existing and incoming investors have in One Media’s Harmony iP
model and the ongoing strategy to capitalise on a market benefiting from
significant tailwinds.
During the recent months the health and safety of our staff and stakeholders
has been of paramount importance. The entire One Media team has been working
harder than ever on a remote basis and I would like to thank everyone for
their exceptional work throughout. The outlook is certainly exciting and we
are looking forward to taking the business to the next level.”
One Media iP Group Plc Michael Infante – CEO Claire Blunt – Chairman +44 (0)175 378 5500 +44 (0)175 378 5501
Cairn Financial Advisers LLP (Nominated Adviser) Liam Murray Jo Turner Ludovico Lazzaretti +44 (0)20 7213 0880
Cenkos Securities plc (Broker) Max Hartley / Max Gould (Corporate Finance) Michael Johnson (Sales) +44 (0)20 7397 8900
Yellow Jersey PR (PR & IR) Charles Goodwin Annabel Atkins +44 (0)20 3004 9512
1. Introduction
On 18 August 2020, the Company announced its intention to raise £6,043,979
(before expenses) by the placing of 86,342,550 new Ordinary Shares at a price
of 7 pence per share.
The Placing consists of the Firm Placing and the Conditional Placing. The Firm
Placing Shares were placed pursuant to existing authorities granted to the
Directors at the Company’s general meeting held on 22 May 2020. The Firm
Placing is conditional, inter alia, on First Admission which is expected will
become effective, and dealings in the Firm Placing Shares are expected to
commence, at approximately 8.00 a.m. on or around 20 August 2020.
The Conditional Placing will be split into the EIS/VCT Placing and the General
Placing. As such the Conditional Placing Shares (consisting of the EIS/VCT
Placing Shares and General Placing Shares) will occur over two Business Days
to assist investors in the EIS/VCT Placing Shares to claim certain tax reliefs
available to EIS and VCT investors. Subject to, inter alia, the passing of the
Resolutions at the General Meeting, the EIS/VCT Placing Shares are expected to
be admitted to trading on AIM on or around 8.00 a.m. on 8 September 2020,
being one Business Day prior to admission to trading on AIM of the General
Placing Shares, which are expected to be admitted to trading on AIM on or
around 8.00 a.m. on 9 September 2020. The allotment of the EIS/VCT Placing
Shares will be conditional on Second Admission occurring. The allotment of the
General Placing Shares will be conditional on Third Admission occurring.
Shareholders and potential investors should be aware of the possibility that
the Second Admission and Third Admission may not occur.
The Placing has not been underwritten. For the Conditional Placing to proceed,
the Company requires Shareholder approval to authorise the Directors to allot
the Conditional Placing Shares and dis-apply statutory pre-emption rights in
relation to the issue of the Conditional Placing Shares.
The passing by Shareholders of the Resolutions at the General Meeting will
give the Directors the authority required to allot the Conditional Placing
Shares as further described in section 9 of this announcement. Subject to all
relevant conditions being satisfied (or, if applicable, waived).
I am writing to set out the background to and reasons for the Placing and to
give you notice of the General Meeting to be held at 11.00 am on 4 September
2020, formal notice of which is set out at the end of the Circular. The
General Meeting is being convened for the purpose of proposing the
Resolutions. The passing of the Resolutions is a condition to completion of
the Conditional Placing. The Directors intend to vote (or procure a vote) in
favour of all of the Resolutions in respect of their own beneficial holdings
totaling 25,709,885 Ordinary Shares, representing approximately 19 per cent of
the Existing Ordinary Shares.
2. Background to and reasons for the Placing
Historically the Company has sought to acquire the full Rights over a
catalogue. The Company has identified and developed an alternative model
which it has termed “Harmony iP” which allows Rights Owners to partially
dispose of exclusive permission to create the Digital Assets over a portion of
their Rights as opposed to a full disposal of all of them.
Harmony iP
The Company has developed the Harmony iP program which enables Rights Owners
to capitalise on future earnings. Harmony iP exchanges exclusive rights to
create and expand the Digital Assets over a portion of copyrights in
performance and writers shares in return for a lump sum payment, calculated as
a percentage of the agreed total value of the relevant intellectual
property. The Rights Owner will continue to receive royalties for their
remaining portion of Rights held.
Harmony iP enables the Company to diversify its portfolio of assets and
acquire exclusive permission to create the Digital Assets over Rights with
recurring income streams at favorable multiples. The Company’s recurring
income model is already linked to a number of recording artists in the 60+ age
bracket who the Directors believe are likely to look at alternative income
opportunities as a result of the COVID-19 pandemic.
Initially 10 artist deals will be sought with deal sizes varying between
£180,000 (low end) to £400,000 (medium) and £1 million (high end).
Currently One Media is in discussions with approximately 15 artists.
The Directors believe that the Harmony iP model provides Rights holders with
significant advantages over the current options available to them and to their
knowledge there are currently no competitors in the industry with a comparable
offering.
The Market
Royalties are generated from music sales and monetised in several ways, with
income from composition and performance Rights. A typical music track
generally enjoys initial success and 5 to 7 years after its peak falls into a
regular income stream. After 10 years a track income is usually fairly
robust and perhaps only approximately 10 per cent. of its original income
stream, making legacy content an attractive acquisition.
Harmony iP is effectively an equity release program, targeted at primarily
composer’s Rights, which typically extend to 70 years after a composer’s
death.
Currently a successful composer leverages Rights to a multi-track catalogue in
several forms:
- an advance from a publisher for a fixed term of exploitation
which is fully recoupable against earnings (the Rights Owner receives a lump
sum and then nothing until the advance is recouped);
- complete a sale of catalogue rights and/or a part of them in
return for a lump sum;
- a bank loan (typically 25% of annual income for a maximum of 5
years); and
- a music bond (also known as a Bowie bond or Pullman bond) being
an asset-backed security which uses as collateral the royalty streams from
album sales and live performances.
Goldman Sachs recently forecasts a 75% decrease in live music revenue in 2020
as a result of COVID-19, however, streaming revenue is predicted to rise
18%. The fall in live music and touring income is expected to affect older
artists who are more susceptible to the adverse effects of COVID-19 and who
may not wish to tour even after lockdown is over. This follows on from 2019
growth of 8.2% in the global recorded music market to revenues of US$20.2
billion. Of this growth, 2019 streaming revenue grew 22.9% to US$11.4 billion
and is forecast to grow to $37.2 billion by 2030 (paid for and ad-supported
streaming).
The Company competes with small records labels; digital retailers (such as
Spotify, Amazon, Apple Music) who may choose to sign direct deals with
recording artists or recorded music companies; other music funds focusing on
revenue yielding content (i.e. Hipgnosis Fund); and recording artists, who may
choose to distribute their own work.
3. Information on the Company
One Media is primarily a music Rights Owner and digital distributor focused on
the acquisition and exploitation surrounding recorded music, publishing and
the writer’s shares of income and video intellectual property rights. The
Company specialises in monetising intellectual property rights with proven,
recurring income streams. It has a catalogue of over 200,000 tracks covering
multiple genres, from pop to rock, country to classics and has invested over
£10 million in catalogue acquisitions to date.
The Company has a deep understanding of digital content and the various
industry monetisation models and, as such, offers Rights Owners a route in
which to divest their music intellectual property holding and for investors to
share in its potential success in corporate growth. The Company has
experienced organic growth derived from the popularity of the streaming medium
expanding into various genres of music, new demographic consumers and new
territories. The Company’s targeted acquisition initiative of music content
meets the consumer demand of emerging new markets.
The Company’s team of in-house creative technicians ensures that its
existing and newly acquired content reaches its full potential for
monetisation, by digitising and creating quality metadata prior to ingesting
to over 600 digital retailers such as iTunes, Spotify, Amazon, YouTube and
Google Play globally. In addition, the Company’s music is used for
synchronisation in film, TV and digital gaming.
The Company is also continuing to develop its proprietary Software as a
Service (SaaS) platform called "TCAT", the Technical Copyright Analysis Tool,
developed as a means of automating the difficult and time-consuming task of
monitoring digital music releases, for instances of unauthorised exploitation.
The bespoke TCAT software is quick and powerful, capable of scanning
legitimate global digital music stores for unauthorised and duplicated
releases, and chart information. With 38% of global music listeners acquiring
music through illegal means, it is potentially a $7 billion issue, and there
is opportunity to improve and scale TCAT for wider use across the industry and
other markets such as detecting fake uploading and providing instant access to
retail data and market insights. There are currently two major record labels
and the world’s largest media distributor currently subscribed to TCAT on a
retained basis.
4. Use of Proceeds
The Company intends to use the proceeds of the Placing for the acquisition of
exclusive rights to create and expand the Digital Assets over a portion of
copyrights in performance and writers shares, primarily through the Harmony iP
asset release program.
5. Current Trading
The Company announced its half year results for 6 months ended 30 April 2020
on 29 June 2020, which stated operations had been unimpacted by COVID-19, and
showed revenues had increased by 28% to £2,032,598 (H1 2019: £1,585,687),
operating profit increased by 98% to £563,257 (H1 2019: £284,360) and EBITDA
increased 93% to £757,678 (H1 2019: £392,192) and operating profit margins
were at 27.7%. Based on the Company’s full year 2019 results to 31 October
2019, the Company has a free cash flow yield of 11.2% (operating free cash
flow to undiluted market capitalisation of the Existing Ordinary Shares at
7.5p per share).
As at 30 April 2020 the Company reported cash balances of £1,076,134 (H1 2019
£5,184,301).
The Company has expanded its catalogue following recent acquisitions which are
expected to drive further growth of recurring income as strong market
fundamentals, driven by increased streaming, further expand the sector. A
scalable business model enables the Group to expand its geographical footprint
and exploit its product offerings. Despite the uncertainty caused by COVID-19,
the business has a robust recurring income model that lends itself to remote
working, much like its major partners, and all of the Group’s business
operations are continuing as normal and the Directors believe its focus on
music streaming leaves the Group well positioned for the COVID-19 world.
6. Executive Directors and Senior Management
Claire Blunt, Independent Non-executive Chair
Claire is currently the chief operating officer and chief financial officer of
Hearst UK. Prior to her current role Claire was chief financial officer of
Hearst UK and took on the additional responsibilities of chief operating
officer in 2017 to expand her role.
Prior to her roles at Hearst UK, Claire has served in lead financial and
management roles at BrightHouse, Selecta Group, Hobbycraft and Staples.
Michael Infante, Founder & Chief Executive Officer
Michael started his career in 1976 in the food industry working for his
family’s business, Creamery Fare. In 1988, after jointly orchestrating the
sale of his family’s business to the publicly listed Hazlewood Foods PLC, he
joined the music industry. He worked on the Royal Philharmonic Orchestra’s
largest recording project as the executive producer for over 140 classical
albums recorded at CTS studios in London.
In 1995 Michael co-founded Air Music & Media Group PLC (now MBL Plc), which
was admitted to trading on the OFEX market (the former name of AQUIS) in 2000
and subsequently moved to AIM in 2001. Recognising the emerging digital market
in 2005, Michael founded the Company.
Michael oversees the Company’s acquisition programme having introduced an
acquisition policy for nostalgic audio/visual content and has made over 80
acquisitions to date of small music and TV content catalogues.
Steve Gunning, Finance Director & Company Secretary
Steve began his career with Barclays Bank plc, where he gained an extensive
knowledge of the banking environment, both personal and corporate followed by
a move to Dixons Group plc, working in the Finance department.
His career then took him to Share plc, an independent retail stockbroker, and
to the position of Chief Accountant. After 8 years with Share plc he took a
position as the company accountant for Kings Oak Homes Ltd (a subsidiary of
Barratt Developments plc) responsible for group reporting.
In 2007 he joined e-Financial Management Ltd, managing a portfolio of clients
providing outsourced finance solutions and expertise to SME’s, before
starting his own company in 2012 and now provides strategic and financial
support to a diverse set of clients in the manufacturing, property, retail,
media and education sectors.
An Accountant with over 20 years’ experience in the finance industry, both
managing the finance function for a wide range of companies and being part of
the senior management team. He has a CIMA Diploma in Management Accounting and
is a member of the Association of Accounting Technicians.
Alice Dyson-Jones, Commercial Director
After graduating from the London College of Music and Media with a degree in
Photography & Media Arts (BA Hon), Alice started her career with media
manufacturers, The VDC Group. Alice’s following twenty years’ experience
expanded into management positions within sales and marketing.
In her role as Commercial Director she ensures that the Company is growing
through targeted acquisitions of music content, expanding into various genres
and territories that stand to see increased returns driven by the global
growth of streaming. Ensuring the optimisation of the Company’s music iP
through the 600+ digital retailers such as iTunes, Spotify, Amazon, YouTube
and Google Play.
In September 2017, Alice was elected as a Director to the British Phonographic
Industry (BPI) and is one of six Independent representatives on the BPI’s
Council. The BPI is the UK record labels’ association that promotes British
music and champions the UK’s recorded music industry – the world’s
fourth largest and the biggest exporter of recorded music in the world after
the US. The BPI helps to safeguard the rights of its members and of all the
artists, performers and record label members of collecting body PPL – who
collectively create around 99 per cent of all legitimate sales and streams of
music in the UK.
Brian Berg, Independent Non-executive Director
Brian Berg is Chairman of Eclipse Global Entertainment. He also holds senior
media and music consultancy roles for various major companies and is Executive
Producer on the hit musical Dreamboats and Petticoats.
Prior to this Brian was the President of Universal Music Enterprises and a
director of Universal Music, which is the biggest record company in the world.
Brian has been chairman of fundraising for the leading music industry charity
Nordoff Robbins Music Therapy, as well as a governor of the school and is
still very involved with the charity.
7. Information on the Placing
The Placing has conditionally raised a total of £6,043,979 before expenses
through the placing of 86,342,550 new Ordinary Shares at the Placing Price to
existing and new investors.
The Placing consists of the Firm Placing and the Conditional Placing. The Firm
Placing Shares were placed pursuant to existing authorities granted to the
Directors at the Company’s general meeting held on 22 May 2020. The Firm
Placing is conditional on the Placing Agreement becoming unconditional in
respect of those shares and First Admission, which it is expected will become
effective, and dealings in the Firms Placing Shares are expected to commence,
at approximately 8.00 a.m. on or around 20 August 2020.
The Conditional Placing will be split into the EIS/VCT Placing and the General
Placing. As such the Conditional Placing Shares (consisting of the EIS/VCT
Placing Shares and General Placing Shares) will occur over two Business Days
to assist investors in the EIS/VCT Placing Shares to claim certain tax reliefs
available to EIS and VCT investors.
Subject to, inter alia, the passing of the Resolutions at the General Meeting,
the EIS/VCT Placing Shares are expected to be admitted to trading on AIM on or
around 8.00 a.m. on 8 September 2020, being one Business Day prior to
admission to trading on AIM of the General Placing Shares, which are expected
to be admitted to trading on AIM on or around 8.00 a.m. on 9 September 2020.
The allotment of the EIS/VCT Placing Shares will be conditional on Second
Admission occurring. The allotment of the General Placing Shares will be
conditional on Third Admission occurring. Shareholders and potential investors
should be aware of the possibility that the Second Admission and Third
Admission may not occur.
Although the Company currently expects to satisfy the relevant conditions for
the Firm Placing Shares and EIS/VCT Placing Shares, and the Directors are not
aware of any subsequent change in the qualifying conditions or the Company's
circumstances that would prevent the Firm Placing Shares and EIS/VCT Placing
Shares from being eligible for EIS and VCT investments on this occasion,
neither the Directors nor the Company, nor Cenkos, nor any of its respective
directors or their officers, employees, affiliates or advisers give any
warranty or undertaking or other assurance that relief will be available in
respect of any investment in the Firm Placing Shares and EIS/VCT Placing
Shares, nor do they warrant or undertake or otherwise give any assurance that
the Company will conduct its activities in a way that qualifies for or
preserves its status. As the rules governing EIS and VCT reliefs are complex
and interrelated with other legislation, if Shareholders, or other potential
investors, are in any doubt as to their tax position, require more detailed
information, or are subject to tax in a jurisdiction other than the United
Kingdom, they should consult their professional adviser.
The Firm Placing Shares and EIS/VCT Placing Shares will be issued to investors
seeking tax relief pursuant to the EIS Legislation and the VCT Legislation.
In connection with the Placing, the Company has entered into a Placing
Agreement under which Cenkos has agreed, in accordance with its terms, to use
its reasonable endeavours to procure subscribers for the Placing Shares at the
Placing Price. The Placing has not been underwritten by Cenkos or any other
person.
The Placing Agreement contains a customary indemnity given by the Company to
Cenkos in respect of liabilities arising out of or in connection with the
Placing. Cenkos is entitled to terminate the Placing Agreement in certain
circumstances prior to each Admission.
The Placing Shares are not being made available to the public and are not
being offered or sold in any jurisdiction where it would be unlawful to do so.
8. Related Party Transaction
Canaccord Genuity Group Inc. (“Canaccord”) has agreed to subscribe for
23,438,500 Placing Shares in the Placing, which will take its aggregate
shareholding in the Company to 49,099,958 Ordinary Shares following Admission
which will constitute 22.1 per cent of the Enlarged Share Capital (assuming
there is no change in Canaccord’s notified position and no other issuance of
shares by the Company between the date of this announcement and Admission).
The subscription for Placing Shares by Canaccord constitutes a related party
transaction for the purposes of Rule 13 of the AIM Rules by virtue of such
person being a substantial shareholder in the Company. The Directors consider,
having consulted with Cairn Financial Advisers LLP, the Company’s nominated
adviser for the purposes of the AIM Rules, that the terms of the transaction
are fair and reasonable in so far as the Shareholders are concerned.
9. General Meeting
A notice convening a General Meeting of the Company to be held at 11.00 am on
4 September 2020 is set out in the Circular. In light of the ongoing
Coronavirus pandemic and with a view to taking appropriate measures to
safeguard its shareholders’ health and make the General Meeting as safe and
efficient as possible, the Company is invoking certain of the provisions of
the Articles to hold the General Meeting as an electronic meeting only.
How to Vote
In the usual way, we ask and encourage Shareholders to vote for the
Resolutions by appointing the Chairman as the Shareholder’s proxy. A
Shareholder may appoint one or more proxies to exercise all or any of their
rights to attend, speak and vote at the General Meeting, provided that each
proxy is appointed to exercise the rights attached to a different Ordinary
Share or Ordinary Shares held by that Shareholder. A proxy need not be a
member of the Company. Accordingly, Shareholders are encouraged to complete
the enclosed Form of Proxy and return it either (i) by email to
voting@shareregistrars.uk.com, (ii) by post to Share Registrars Ltd at The
Courtyard, 17 West Street, Farnham, Surrey GU9 7DR or (iii) for Ordinary
Shares held in CREST, through the CREST system. To be valid, the Form of Proxy
(or other instrument appointing a proxy) must be received by 11.00 a.m. on 2
September 2020. We recommend, on this occasion and due to ongoing restrictions
relating to the Covid-19 situation, that proxies are sent by email where
possible.
In accordance with article 66.1 of the Articles, voting on the Resolutions
will be conducted on a poll and there will be no show of hands. This means
that your votes will be counted for all of your Ordinary Shares.
You will be able to submit a poll card (if you wish to change your votes
contained in your completed Form of Proxy or if you have not completed a Form
of Proxy) in a short window after the meeting has formally closed.
Instructions on how to do this will be given on the electronic meeting
platform.
How to Speak
If you wish to raise a question at the General Meeting, we ask that you submit
your question in advance. We would politely remind you that the Directors will
not answer questions relating to the individual rights of Shareholders at the
General Meeting itself, but if you wish to submit such a question by email, we
will respond to the extent we are able.
If you chose to submit a question, we will confirm to you at least 48 hours in
advance of the meeting that the question will be addressed. Unless you
specifically request otherwise, the Chairman will put your question to the
meeting and identify you by name as the person who has put the question (in
the same way as he would ask you to identify yourself at an in-person
meeting). Conducting the meeting in this way will allow everyone present to
clearly hear the question and answer.
In addition, there will be a short period at the start of the meeting for
additional questions, but we would be very grateful if any matters could be
raised in advance, as this will enable questions to be dealt with expediently.
Questions on the day will be taken by Shareholders using the electronic
“raise your hand” feature or typing their question into the Q&A box in the
meeting. You will be kept on mute by the meeting host unless and until you are
invited to ask your question(s).
Please submit any questions by email to the Company Secretary at
AGM@onemediaip.com with the subject line “GM Question”.
On the Day of the Meeting
The General Meeting will take place at 11.00 am on 4 September 2020.
You will be asked to enter a password to gain access to the General Meeting.
This code can be found on the bottom section of your Form of Proxy. If you are
returning the Form of Proxy by post, please detach and keep this portion of
the Form of Proxy before returning it.
When the General Meeting opens at the appointed time, you will be able to see
and hear the Chairman. The Chairman will open the meeting and address any
questions that have been submitted in advance. There will then be a short
opportunity for Shareholders to put any additional questions. Shareholders
should indicate if they would like to ask a question using the electronic
“raise your hand” feature or by typing their question into the Q&A box in
the meeting. All attendees will remain muted by the host unless and until they
are invited to ask a question.
The Chairman will then formally put the Resolutions to the General Meeting and
advise of the proxy votes received in advance.
The meeting will then formally close.
As Shareholders exit the meeting, they will have the option to submit an
electronic poll card to record their vote. If you (a) have already submitted a
proxy instruction and do not wish to change your vote; or (b) do not wish to
vote, you can click on the button to skip this step.
The voting facility will switch off 30 minutes after the close of the General
Meeting.
The results of the General Meeting will be announced by RNS and posted to the
Company’s website www.omip.co.uk on the day of the meeting. The full poll
results will also be published on this website at the same time.
Business of the General Meeting
The business to be considered at the General Meeting is set out in the Notice
of General Meeting in the Circular. The Conditional Placing is conditional
upon, among other things, the passing of the Resolutions.
At the annual general meeting of the Company held on 22 May 2020, Shareholders
passed resolutions in order to inter alia: (i) grant the Directors authority
to allot equity securities up to a maximum nominal value of £203,000; and
(ii) disapply statutory pre-emption rights to allow the allotment by the
Directors of equity securities for cash up to an aggregate nominal value of
£102,000 without the requirement for such equity securities to be first
offered to existing Shareholders. The issue of the Conditional Placing Shares,
together with other relevant prior allotments, renders the second of these
authorities insufficient to allow the issue of the Conditional Placing Shares
to proceed without further Shareholder approval. Accordingly, the Conditional
Placing is conditional on Resolutions 1 and 2 being passed.
The Company is therefore proposing that Shareholders pass the Resolutions in
order to:
(1) grant authority to the Directors under section 551 of the Act,
to allot Ordinary Shares up to a maximumaggregatenominalamount of £330,293
beingthemaximumrequiredthepurposesof issuing the Conditional Placing Shares;
and
(2) theunder570oftheAct,toallot the ConditionalPlacingonanonbasis.
Each of the authorities sought at the General Meeting will be in addition to
the authorities granted at the 2020 AGM. These authorities will expire on
the earlier of 31 May 2021 and the end of the AGM in 2021.
10. EIS and VCT Status
Venture Capital Trusts
The Board understands that the VCT Placing Shares should represent a
“qualifying holding” for the purpose of investment by VCTs. The continuing
status of the VCT Placing Shares as a qualifying holding for VCT purposes will
be conditional, inter alia, on the VCT Placing Shares being held as a
qualifying holding for VCT purposes throughout the period of ownership. It is
the Board’s intention that the Company will continue to meet the VCT
provisions so that it continues to be a qualifying company for these purposes.
However, neither the Company nor any of the Directors give any representation,
warranty or undertaking that any investment in VCT Placing Shares will remain
a qualifying holding, including in the event that the Board believes that the
interests of the Company and its shareholders as a whole are not best served
by preserving the VCT status, or as a result of changes in legislation.
Enterprise Investment Scheme
The Company intends to issue compliance certificates in respect of the EIS
Placing Shares to the relevant individuals under section 204 of the ITA
following authorisation from HMRC of properly completed compliance statements
(EIS 1 forms) submitted within the prescribed time limit stipulated in section
205(4) of the ITA. The submission of such compliance statements by the Company
does not guarantee EIS qualification for an individual, whose claim for relief
will be conditional upon his or her own circumstances and is subject to
holding the EIS Placing Shares throughout the relevant three-year period.
In addition, for EIS relief not to be withdrawn, the Company must comply with
a number of conditions throughout the qualifying period relating to those
shares.
The following paragraphs provide a general outline of EIS tax reliefs that may
be available to individual investors. Any potential investor should obtain
independent advice from a professional adviser in relation to their own
particular circumstances.
In summary, EIS relief may be available when a qualifying company issues
shares, the purpose of which is to raise money for a qualifying business
activity. A qualifying business activity includes a qualifying trade which,
broadly, comprises a trade that is conducted on a commercial basis with a view
to the realisation of profits and which does not comprise any excluded
activities. In order to qualify, the EIS shares must be subscribed for in
cash, be fully paid up at the date of issue and must be held, broadly, for
three years after they were issued.
EIS income tax relief is available to individuals only. The current relief
provides for 30 per cent of the amount invested to be set against an
individual’s liability to income tax for the tax year in which the EIS
investment is made, available up to a maximum of £1 million (or £2 million
provided at least £1 million is invested in knowledge-intensive companies)
per tax year. This relief can be ‘carried back’ to the previous tax year
but may not be carried forward.
This relief is only available to individuals who are not connected to the
Company in the period of two years prior to and three years after the
subscription. Broadly, an individual in connected with the issuing company if
they or their associates are employees or directors of the Company or have an
interest in more than 30 per cent of the Company’s ordinary share capital.
Where EIS income tax relief has been given and has not been withdrawn, any
gain on the subsequent disposal of the shares in qualifying circumstances is
generally exempt from capital gains tax. If the shares are disposed of at a
loss, capital gains tax relief will generally be available for that loss net
of any income tax relief previously given. Alternatively, an election can be
made to set that loss (less any income tax relief already given) against
income of that tax year or the preceding tax year.
Individuals who have realised gains on other assets may be able to defer a
capital gains tax liability arising on such gains by making a claim to
reinvest an amount of those gains against the cost of EIS Placing Shares,
where the subscription for EIS Placing Shares takes place within one year
before or up to three years after the disposal of the assets. Such deferred
gains will become chargeable on a disposal or deemed disposal of the EIS
Placing Shares.
11. Admission, Settlement and CREST
Application will be made to the London Stock Exchange for the Placing Shares
to be admitted to trading on AIM. It is expected that First Admission will
become effective and that dealings in the Firm Placing Shares will commence at
8.00 am on or around 20 August 2020. On the assumption that, among other
things, the Resolutions are passed, it is expected that Admission of the
EIS/VCT Placing Shares will become effective and that dealings in the EIS/VCT
Placing Shares will commence at 8.00 a.m. on or around 8 September 2020
(Second Admission) and Admission of the General Placing Shares will become
effective and that dealings in the General Placing Shares will commence at
8.00 am on or around 9 September 2020 (Third Admission).
The Articles permit the Company to issue shares in uncertificated form. CREST
is a computerised paperless share transfer and settlement system which allows
shares and other securities to be held in electronic rather than paper form.
The Ordinary Shares are already admitted to CREST and therefore the Placing
Shares will also be eligible for settlement in CREST. CREST is a voluntary
system and Shareholders who wish to retain certificates will be able to do so
on request.
12. Action to be taken by Shareholders in respect of the
General Meeting
Shareholders will find enclosed with the Circular a Form of Proxy for use at
the General Meeting.
Shareholders are encouraged to complete and return the Form of Proxy by email
to voting@shareregistrars.uk.com or by post to the Company’s registrar,
Share Registrars Ltd, at The Courtyard, 17 West Street, Farnham, Surrey
GU9 7DR in accordance with the instructions printed thereon as soon as
possible. To be valid, the Form of Proxy provided or other instrument
appointing a proxy must be received by email at voting@shareregistrars.uk.com
or by post at the offices of Share Registrars Ltd, the Company’s registrar,
at the address shown on the Form of Proxy. For proxy appointments to be valid,
they must be received no later than 11.00 a.m. on 2 September 2020.
Although Shareholders are encouraged to vote by proxy, completion and return
of a Form of Proxy will not prevent you from participating in the electronic
General Meeting and submitting a poll card following the meeting to change
your vote should you wish to do so.
The Board is recommending that Shareholders support all the Resolutions before
the General Meeting by returning your proxy instruction by post or by email to
voting@shareregistrars.uk.com as indicated in the Form of Proxy.
13. Recommendation
The Directors believe that the Resolutions to be proposed at the General
Meeting are in the best interests of the Company and Shareholders as a whole
and unanimously recommend that you vote in favour of them as they intend to do
(or procure to be done) in respect of their own beneficial holdings totaling
25,709,885 Ordinary Shares, representing approximately 19 per cent of the
Existing Ordinary Shares.
EXPECTED TIMETABLE OF PRINCIPAL EVENTS
Admission of and commencement of dealings in the Firm Placing Shares expected on AIM 8.00 a.m. on 20 August 2020
Latest time and date for receipt of Forms of Proxy for General Meeting 11.00 a.m. on 2 September 2020
General Meeting 11.00 a.m. on 4 September 2020
Admission of and commencement of dealings in the EIS/VCT Placing Shares expected on AIM 8.00 a.m. on 8 September 2020
Admission of and commencement of dealings in the General Placing Shares expected on AIM 8.00 a.m. on 9 September 2020
Despatch of definitive share certificates in respect of the Placing Shares to be issued in certificated form (if required) Within 10 days of Admission
Notes:
1. Each of the times and dates refer to London time and are subject to change
by the Company (with the agreement of Cenkos), in which case details of the
new times and dates will be notified to the London Stock Exchange and the
Company will make an appropriate announcement through a Regulatory Information
Service.
2. Admission and dealings in the Placing Shares are conditional on the passing
of the Resolutions at the General Meeting.
PLACING STATISTICS
Placing Price 7 pence
Number of Existing Ordinary Shares 135,603,699
Number of Placing Shares 86,342,550
Number of Firm Placing Shares 20,284,000
Number of Conditional Placing Shares 66,058,550
Number of Ordinary Shares in issue immediately following completion of the Placing(1) 221,946,249
Placing Shares as a percentage of the enlarged issued share capital 39%
Market capitalisation at the Placing Price following Admission £15,536,237
Gross cash proceeds of the Placing £6,043,979
Estimated net cash proceeds of the Placing receivable by the Company £5,600,000
ISIN Code GB00B1DRDZ07
SEDOL Code B1DRDZ0
Note:
(1) Assuming that no other Ordinary Shares (other than the Placing
Shares) will be issued in the period between the date of this announcement and
completion of the Placing.
DEFINITIONS
The following definitions apply throughout this announcement unless the
context requires otherwise:
“ Act ” the Companies Act 2006
“ Admission ” First Admission and/or Second Admission and/or Third Admission, as the context requires, of the Placing Shares to trading on AIM becoming effective in accordance with Rule 6 of the AIM Rules
“ AIM ” the AIM market of the London Stock Exchange
“ Articles of Association ” the articles of association of the Company adopted at the annual general meeting on 22 May 2020
“ AIM Rules ” the AIM Rules for Companies published by the London Stock Exchange
“ Business Day ” any day on which banks are generally open in England and Wales for the transaction of business, other than a Saturday, Sunday or public holiday
“ Cenkos ” Cenkos Securities plc, broker to the Company
“ Company ” or “ One Media ” One Media iP Group Plc
“Conditional Placing” the placing of the Conditional Placing Shares pursuant to the Placing
“Conditional Placing Shares” the Ordinary Shares to be allotted and issued pursuant to the EIS/VCT Placing and the General Placing
“ CREST ” a 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), as amended from time to time
“ Digital Assets ” means digital assets for commercial distribution and exploitation based on the content
“ Directors ” or “ Board ” the existing directors of the Company whose names are set out on page 5 of the Circular
“ EIS “ the enterprise investment scheme under Part 5 of the ITA
“ EIS Legislation ” the provisions of Part 5 of the ITA, sections 150A to 150D of the Taxation of Capital Gains Act 1992
“EIS/VCT Placing” the placing by Cenkos on behalf of the Company of the EIS/VCT Placing Shares at the Placing Price pursuant to the terms of the Placing Agreement
“ EIS/VCT Placing Shares ” the 51,144,000 new Ordinary Shares which have been conditionally placed by Cenkos with the Placees pursuant to the EIS/VCT Placing
“Euroclear ” Euroclear UK & Ireland Limited
“ Existing Ordinary Shares ” the 135,603,699 Ordinary Shares in issue at the date of this announcement
“Firm Placing” the placing by Cenkos on behalf of the Company of the Firm Placing Shares at the Placing Price pursuant to the terms of the Placing Agreement
“Firm Placing Shares” 20,284,000 new Ordinary Shares to be allotted and issued pursuant to the Firm Placing
“First Admission” the Admission of the Firm Placing Shares to trading on AIM becoming effective in accordance with Rule 6 of the AIM Rules which is expected to take place on 20 August 2020
“ Form of Proxy ” the form of proxy for use in connection with the General Meeting
“ General Meeting ” the general meeting of the Company to be held at 11.00 am on 4 September 2020 on an electronic platform only or any adjournment thereof, notice of which is set out in the Notice of General Meeting
“General Placing” the placing by Cenkos on behalf of the Company of the General Placing Shares at the Placing Price pursuant to the terms of the Placing Agreement
“ General Placing Shares ” the 14,914,550 new Ordinary Shares which have been conditionally placed by Cenkos with the Placees pursuant to the General Placing
“ Group ” the Company and its subsidiary undertakings
“Harmony iP” intellectual property music asset release initiative being presented by the Group to allow Rights Owners to release a portion of their ownership in exchange for money
“ ITA” the Income Tax Act 2007
“ London Stock Exchange ” London Stock Exchange plc
“ Notice of General Meeting ” the notice convening the General Meeting which is set out in the Circular
“ Ordinary Shares ” ordinary shares of 0.5 pence each in the capital of the Company
“ Placees ” the persons who have conditionally agreed to subscribe for the Conditional Placing Shares
“ Placing ” the Firm Placing and the Conditional Placing by Cenkos on behalf of the Company of the Placing Shares at the Placing Price under the Placing Agreement
“ Placing Agreement ” the agreement between the Company and Cenkos dated 18 August 2020 relating to the Placing
“ Placing Price ” 7 pence per Placing Share
“ Placing Shares ” the 86,342,550 new Ordinary Shares to be allotted and issued pursuant to the Placing, consisting of the Conditional Placing Shares and the Firm Placing Shares, as the context requires
“ Regulatory Information Service ” the regulatory information services approved by the London Stock Exchange for the distribution of AIM announcements
“Rights” The commercial ownership and right to the royalties and other income streams stemming from the monetisation of music songs and catalogues
“Rights Owners” those who own and are entitled to the economic benefits attaching to the Rights
“ Resolutions ” the resolutions to be proposed at the General Meeting, details of which are set out in the Notice of General Meeting
“Second Admission” the admission of the EIS/VCT Placing Shares to trading on AIM becoming effective in accordance with Rule 6 of the AIM Rules which is expected to take place on 8 September 2020
“ Shareholders ” the holders of Ordinary Shares from time to time
“Third Admission” the admission of the General Placing Shares to trading on AIM becoming effective in accordance with Rule 6 of the AIM Rules which is expected to take place on 9 September 2020
“ United States ” United States of America and its territories
“ VCT ” a venture capital trust under Part 6 of the ITA
“ VCT Legislation ” the provisions of Part 6 of the ITA, sections 151A and 151B of the Taxation of Capital Gains Act 1992 and Part 6 of the Income Tax (Trading and Other Income) Act 2005
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