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

This announcement contains inside information for the purposes of Article 7 of the Market Abuse Regulation (EU) No 596/2014. as it forms part of UK Domestic Law by virtue of the European Union (Withdrawal) Act 2018 ("UK MAR").

8 July 2022

LIVE COMPANY GROUP PLC

("LVCG", the "Company" or the "Group")

Conditional placing and  proposed acquisition

Notice of General Meeting

Total Voting Rights

Live Company Group plc (AIM: LVCG) (the "Company") announces a conditional placing ("Fundraise")  together with the proposed acquisition of the remaining shareholding in Start Art Global Ltd ("Start Art") in which the Company currently has a 19.94% interest(" together the Transaction").

Highlights

·        Placing of new Ordinary Shares of 1p each at a price of 4.0p per share to raise gross proceeds of £0.6 million of which £0.48 million will be used for working capital requirements and expansion plans for KPOP, BRICKLIVE and LCSE and £120,000 for the initial cash consideration the Acquisition.

·        To provide shareholders and other investors who did not initially have the opportunity to participate in the Placing to now do so, the Company has implemented a Broker Option allowing subscriptions up to £0.4 million on the same terms as the Placing with priority given to existing shareholders of the Company.

·        To strengthen the Company's balance sheet and develop the Kpop.Flex brand with events confirmed for London and Frankfurt and discussions ongoing to secure more locations.

·        Acquisition of the remaining 80.06% interest in Start Art (a Related Party Transaction under the AIM Rules) ("Acquisition").

·        The Acquisition and the Fundraise are conditional upon, inter alia, the passing of Resolutions to be put to shareholders of the Company at a General Meeting of the Company to be held on 27 July 2022 ("GM"). 

·        The Acquisition brings into the Group's full ownership a new division and allows for the streamlining of costs and efficiencies.

The Conditional Placing

To provide funding for  working capital for the Group and the initial cash consideration for the Acquisition, the Company has raised £0.6 million (before expenses) by way of a placing of 15,000,000 new Ordinary Shares of 1p each ("Placing Shares") arranged  through Monecor (London) Limited trading as OvalX ("OvalX") at a placing price of 4.0p per share (the "Placing Price") (the "Placing"). The Placing Price represents a discount of circa 13% to the closing price per Ordinary Share of 4.6p on AIM on 07 July  2022.

The Company has entered into a placing agreement dated 7 July 2021 (the "Placing Agreement") with Monecor (London) Limited trading as OvalX ("OvalX") pursuant to which they, as agents for the Company, have procured placees for the Placing Shares at the Placing Price.

The obligations of OvalX under the Placing Agreement are conditional, inter alia, upon the approval of shareholders at a GM dated 27 July 2022 and the admission of the Placing Shares to trading on AIM ("Placing Share Admission") having occurred by 8.00 a.m. on 28 July 2022 (or such later time and/or date as may be agreed, being no later than 8.00 a.m. on 1 August 2022), and there being no material breach of the warranties given to prior to admission of the Placing Shares. Following Placing Share Admission, such Placing Shares will rank pari passu with the existing Ordinary Shares.

A Circular including the Notice of Meeting for the GM will be circulated shortly.

OvalX may terminate the Placing Agreement in specified circumstances (including for breach of warranty at any time prior to admission of the Placing Shares, if such breach is reasonably considered by Monecor  to be material in the context of the Placing) and in the event of a force majeure event occurring at any time prior to admission of the Placing Shares.  If the conditions of the Placing Agreement are not fulfilled on or before the relevant date in the Placing Agreement, placing monies will be returned to placees without interest as soon as possible thereafter.  If the Placing Agreement is terminated, the Acquisition will not take place.

Broker Option

The Broker Option has been granted for primarily shareholders and other investors who did not initially have the opportunity to participate in the Placing to now do so on the same terms as the Placing up to a total of 10,000,000 new ordinary. Shares of 1p each ("Broker Option Shares").

Independent financial advisers, stockbrokers or other firms authorised by the Financial Conduct Authority may apply to participate in the Broker Option, on behalf of existing shareholders and other interested applicants. Independent financial advisers, stockbrokers, or other firms authorised by the Financial Conduct Authority, should communicate their interest in participating in the Broker Option to Oval Money on 020 7392 1432.

Each application should state the number of Broker Option Shares that the interested party wishes to acquire at the Issue Price and should be submitted to OvalX no later than 12pm on 25 July 2022.

It is expected that, following allocations by OvalX (in consultation with the Company), application will be made to the London Stock Exchange for the relevant amount of Broker Option Shares to be admitted to trading on AIM ("Broker Option Admission"). Broker Option Admission is expected to become effective and trading of the Broker Option Shares will commence at 8.00 a.m. BST on 1 August 2022. Following Broker Option Admission, such Broker Option Shares will rank pari passu with the existing Ordinary Shares.

Start Art Acquisition

The concept of Start Art as an online platform was launched by David Ciclitira in 2020 as part of the Global Eye Programme (first launched as a physical concept in Korea in 2009)  and was given further impetus by the financing, strategic vision and knowledge of the Asian art market by Ranjit Murugason, the deputy chairman of Start Art. Currently, David Cicilitira (Chairman of LVCG) owns 54.08% of the shares in Start Art with the remaining 25.97% of the shares held by Ranjit Murugason (a non-executive director of LVCG) who provided some initial funding for the Start.art business in 2021. LVCG currently owns 19.94% following a capital restructure of Start Art.

For the period ended 31 December 2021 Start Art reported unaudited turnover of £0.554 million  and had at that date net assets of £1.5 million. (£1.2 May 2022)  Going forward, the core strategy of Start Art will consist of three main streams these being art and art related physical shows, on-line and off-line sales of art and K-Pop related merchandise and NFTs. There is also the opportunity for sponsorship revenue for each event being held.  The synergy between art, popular culture including KPOP and live events further validates the acquisition.

An independent valuation was conducted which valued the entire business at between £5.0 and £5.5 million and the element of the deferred consideration which is performance related is tied into the projections inherent in that valuation.

Terms of the Acquisition

The Company has agreed, subject to the passing of the Resolutions to be proposed at the forthcoming General Meeting, to acquire the remaining  80.06% of the issued share capital of Start Art for a total maximum consideration of £4,002,804 ("Consideration")

This comprises an initial cash consideration of £120,000 payable to Ranjit Murugason on completion of the transaction together with, £1,061,402  and £35,699 to be satisfied by the issue at a price of 6p per share of 17,690,036 and 594,991 new ordinary shares ("Consideration Shares") to Mr Ciclitira and Mr Murugason respectively.

A further cash consideration of £300,000 and £200,000 payable on 31 December 2022 to Mr Ciclitira and Mr Murugason respectively.

The balance of £1,342,769 and £942,934, being the deferred consideration, is payable to Mr Ciclitira and Mr Murugason in cash or shares issued at 6p per share at the Company's option no later than 30 June 2023, 65% of which being subject to EBIT as reported in the audited accounts of Start Art for the year ending 31 December 2022 exceeding £488,000.

In the event the 2022 EBIT threshold is not met the deferred consideration remains payable no later than 30 June 2024, 65% being subject to EBIT as reported in the audited accounts of Start Art for the year ending 31 December 2023 exceeding £1,482,000. In the event the 2023 EBIT threshold is not met only the 35% of the deferred consideration not subject to the EBIT threshold will be payable.

In the situation where a significant value crystalisation event occurs which reflects a value for Start.art greater than the consideration paid by LVCG this will also trigger the immediate payment of the deferred consideration.

If the Broker Option raises £400,000, then the £120,000 payable to Ranjit Murugason as initial consideration will be increased to £200,000, with a correspondening decrease in the deferred consideration payable to him.

This would result in the following shareholdings, also taking into account the issue of the Placing Shares, the Fees Shares, the Consideration Shares and the EMHL Deferred Consideration Shares, but not the Broker Option Shares or any shares to be issued under the deferred consideration arrangements described above:

Related Party Transaction

David Ciclitira is a Director of the Company and a substantial shareholder, together with Maria Serena Papi (Serenella Ciclitira) holding 19.94% of the Company's issued share capital. Ranjit Murugason is also a Director of the Company. Accordingly, they are defined as Related Parties under the AIM Rules for Companies (the "AIM Rules").

Accordingly, the Acquisition of the remaining 80.06% shareholding, in Start Art where David Ciclitira is currently a 54.08% shareholder and Ranjit Murugason is a 25.97% shareholder, is  classified as a Related Party Transaction pursuant to Rule 13 of the AIM Rules ("Rule 13").

Bryan Lawrie through CFO Partners Limited has provided certain consulting services to Start Art and is therefore also considered to have an involvement in the transaction for the purposes of Rule 13.

The Directors of the Company, other than David Ciclitira, and Maria Serena  Papi, Ranjit Murugason and Bryan Lawrie, being Stephen Birrell ("Independent Director") consider, having consulted with the Company's Nominated Adviser, Beaumont Cornish Limited, that the terms of the Transaction are fair and reasonable insofar as the Company's Shareholders are concerned.

In forming his view, the Independent Director has taken into account an independent valuation of the interest being acquired by the Company which has indicated a value range in excess of the consideration being paid and has also taken into account the desirability of adding a further revenue stream to the Company's existing business.

The Independent Director also considers that :

·    The cost and time efficiencies of having Start.art fully under the LVCG are advantageous to the Group

·    The revenue producing physical art fairs complement the BRICKLIVE; KPOP and E-fest Events with opportunities for cross sell of merchandise

·    Sponsorship revenue for art based events and alignment with key sponsors such as major Korean electronics brands is advantageous to the enlarged Group

·    The original online art sales concept of Startart can be developed into a more directly revenue generating concept as well as complementing and deriving revenue from the physical art shows which are being expanded beyond the annual Saatchi Gallery show.

In considering these facts and after careful deliberation, the Independent Director concluded that the Acquisition is beneficial to the Company and that the consideration being lower than the independent valuation range offers potential value to Shareholders and will therefore be recommending that Shareholders vote for the necessary resolutions to approve the Acquisition at the forthcoming General Meeting.

Warrants

The Company will issue warrants of 7,500,000 to subscribe for a total of 7,500,000 new ordinary shares of 1p each ('new Ordinary Shares") on a ratio of 1 warrant per two Placing Share ("Placing Warrants") in relation to the Placing and up to 5,000,000 warrants on similar terms in relation to the Broker Option. (together the "Warrants")

Each Warrant will provide the holder the right to one new Ordinary Share on its exercise. The Warrants will be exercisable at a price of 8.0p for a two-year period from the date of admission oof the placing shares and the Broker Option Shares respectively, subject to any extension in accordance with the Warrant instrument. If exercised in full, the Warrants would result in the issue of up to a further 12,500,000 new Ordinary Shares.

Issue of consideration shares for E-Movement Holdings Ltd ("EMHL")

As previously announced, the Company entered into an agreement to purchase the entire issued share capital of EMHL in December 2020, the Company has now entered into an agreement whereby £10,000 of the outstanding deferred consideration shall be satisfied by the issue 250,000 new Ordinary Shares of 1p each at the placing price ("EMHL Deferred Consideration Shares") to Iain Banner and Bruce Parker-Forsyth, a further £105,000 remains outstanding..

Issue of Fee Shares

The Company will also issue 80,000 new Ordinary Shares of 1p each for payment of professional services amounting to £3,200 at the Placing Price ("Fee Shares").

David Ciclitira, Chairman of LVCG said: "I believe that bringing 100% of Start Art into LVCG creates a unique investment of a content led multi-divisional Company that owns all its own brands on AIM. I see significant growth potential across the divisions and new revenue coming from the art division with Start Art in Seoul profitable from year one (2022). We are looking to develop our art offering further on a year on year basis and see potential opportunities for revenue growth by leveraging with complementary tech platforms in the block chain space. Brand ownership will be key. I look forward to updating shareholders in due course on the development of further KPOP and Art shows"

AIM Application and Total Voting Rights

The Placing Shares, Consideration Shares, Fee Shares and  EMHL Deferred Consideration Shares amounting in aggregate to 33,615,027 and with the Broker Option Shares up to 43,615,027 new ordinary shares of 1p each ("New Shares")  will, when issued, be credited as fully paid and will rank pari passu in all respects with the existing Ordinary Shares, including the right to receive all dividends or other distributions made, paid or declared in respect of such shares after the date of issue.

The issuance of the New Shares  is conditional upon, inter alia, the passing of resolutions to be put to shareholders of the Company at the GM to be held on 27 July 2022 ("the GM") to provide authority to the Directors to issue and allot the required shares on a non-pre-emptive basis. A circular, containing a notice of the GM, will be posted to shareholders shortly. 

Conditional on the passing of the resolutions at the GM, application will be made for the New Shares to be admitted to trading on AIM and it is expected that their admission to AIM will take place on or around 27 July 2022. ("Admission"). 

Following Admission, the enlarged issued share capital of the Company will comprise 217,569,604 (up to 227,569,604 including the Broker Option Shares) ordinary shares of 1p each ("Ordinary Shares").  Each Ordinary Share has one voting right.  No Ordinary Shares are held in treasury.  The above figure may be used by LVCG shareholders as the denominator for the calculation by which they will determine if they are required to notify their interest in, or a change to their interest in, the Company under the FCA's Disclosure Guidance and Transparency Rules.

Post GM approval of the issuance of new shares the Directors will have the following interest in the Company (assuming no take-up of the Broker Option Shares).

Beaumont Cornish Limited ("Beaumont Cornish"), which is authorised and regulated in the United Kingdom by the FCA, is acting as Nominated Adviser ("Nomad") to the Company in connection with the matters contained in this announcement, and will not be acting for any other person or otherwise be responsible to any person for providing the protections afforded to clients of Beaumont Cornish or for advising any other person in respect of the matters set out in this announcement or any transaction, matter or arrangement referred to in this announcement. Beaumont Cornish's responsibilities as the Company's Nomad are owed solely to London Stock Exchange and are not owed to the Company or to any Director or to any other person in respect of his or her decision to acquire any shares in the Company.

Enquiries:

Live Company Group Plc                                                                Tel: 020 7225 2000

Sarah Ullman, Chief Operating Officer

Beaumont Cornish Limited (Nominated Adviser)                                    Tel: 020 7628 3396

Roland Cornish/Rosalind Hill Abrahams                                                                   

This announcement contains inside information for the purposes of Article 7 of the Market Abuse Regulation (EU) No 596/2014. as it forms part of UK Domestic Law by virtue of the European Union (Withdrawal) Act 2018 ("UK MAR").

LIVE COMPANY GROUP

Live Company Group Plc ("LVCG", the "Company" or the "Group") is a live events, entertainment and sports events company, that has been trading on AIM since 2017.

The Group is divided into four divisions;  BRICKLIVE, consisting of a network of partner-driven fan-based and touring shows using BRICKLIVE created content worldwide. The Company owns the rights to BRICKLIVE - an interactive experience built around the creative ethos of the world's most popular construction toy bricks. The Group is an independent producer of BRICKLIVE and is not associated with the LEGO Group.  The second is Kpop Europa (KPE), which operates the KPOP.flex Festival in Frankfurt.  KPOP.flex Frankfurt is Europe's first ever Mega KPOP music festival.  The third is Live Company Sports and Entertainment, which manages a number of global sports, entertainment and lifestyle events. LCSEs main focus for 2022 will be Cape Town Cycle Tour and the successful  one year out launch of the Formula E Cape Town race for series 9 in 2023.  The fourth division is StART Art Global, in which LVCG holds a minority stake. StART Art Global is a combination of both physical art shows and a digital art platform.

Website: www.livecompanygroup.com.