28th Apr 2006 16:23
Electric Word PLC28 April 2006 28th April 2006 ELECTRIC WORD PLC Placing and Acquisition Electric Word plc, the specialist information publisher, announced today theacquisition of Incentive Plus Limited and Incentive Publishing Limited, for atotal cash consideration of £2.05 million. Both businesses are closelyaffiliated to and supply the educational markets which Electric Word serves andfor which it holds large databases. Incentive Plus (IP) is a leading educational mail order business providingpractical materials in the areas of social, emotional and behaviour skills inchildren and young people - a market in which Electric Word holds an establishedposition, publishing extensive materials for teachers. Incentive PublishingLimited is a smaller business with its own range of pupil motivational andbehavioural materials that are marketed and distributed by Incentive Plus. IP'slargest markets are in secondary and primary schools, but also include socialservices departments and other professional groups working with children. Thecombined businesses achieved adjusted audited pre-tax profits of £209k on aturnover of £2,400k in the year ended 31 December 2005 (unadjusted auditedpre-tax profits were £306k, with directors' drawings of £97k. The audited netassets of the combined businesses were £309k at 31 December 2005). The consideration will be funded by a placing of 23,030,303 new ordinary sharesin the Company at 8.25p per share, to raise £1.9m before expenses, plus bankdebt. Application has been made for admission of the new ordinary shares totrading on AIM and dealings in the new ordinary shares issued under the placingare expected to commence on 5 May 2006. The combined acquisition is expected tohave no significant impact on earnings in the current financial year. This latest acquisition by Electric Word follows the purchase of SportBusinessGroup for £2.74 million in January, which has shown particularly encouragingprogress within a larger specialist group. Commenting on the acquisition, Julian Turner, Chief Executive of Electric Wordsaid: "The IP customer base and product offering map neatly onto several of ElectricWord's 27 established education management subscription titles. We expecttherefore to utilise our educational databases to the benefit of both IPbusinesses. We also have opportunities to apply Electric Word's e-marketingexpertise to accelerate the shift to online sales, which currently account forjust 11% of IP revenues, and to broaden the range of sectors that IP serves tocover other areas of Electric Word strength." Electric Word's trading this year continues to be in line with the Board'sexpectations. ENDS EnquiriesJulian Turner, Chief ExecutiveDominic Jacquesson, DirectorElectric Word 0207 954 3470 Kim Muckle/Tim SprattFinancial Dynamics 0207 831 3113 Grant Harrison / Andrew PottsPanmure Gordon & Co 0207 459 3600 APPENDIX: IMPORTANT INFORMATION ON THE PLACING 1. Definitions Capitalised terms used in this announcement shall have the following meanings: "AIM" means AIM, a market operated by the Exchange; "Company" or "Electric Word" means Electric Word plc; "CREST" means the relevant system (as defined in the Uncertificated SecuritiesRegulations 2001) in respect of which CRESTCo is the operator "CRESTCo" means CRESTCo Limited "Directors" means the directors of the Company; "Exchange" means London Stock Exchange plc; "Group" means the Company and its subsidiary undertakings from time to time; "Ordinary Shares" means the ordinary shares of 1p each in the capital of theCompany; "Panmure Gordon & Co" means Panmure Gordon (Broking) Limited (trading as PanmureGordon & Co) whose registered office is at Moorgate Hall, 155 Moorgate, London,EC2M 6XB; "Placees" means the persons to whom the Placing Shares are issued or soldpursuant to the UK Placing, and Placee shall mean any one of them; "Placing" means the placing of the Placing Shares at the Placing Price byPanmure Gordon & Co on behalf of the Company pursuant to the Placing Agreement; "Placing Agreement" means the placing agreement relating to the Placing dated 28April 2006 between the Company, the Directors, and Panmure Gordon & Co; "Placing Commitment" means the number of Placing Shares that each Placee hasagreed to subscribe for or purchase pursuant to the UK Placing; "Placing Price" means 8.25p per Ordinary Share; "Placing Shares" means 23,030,303 Ordinary Shares which are the subject of thePlacing; "Securities Act" means the United States Securities Act of 1933, as amended; and 2. Terms and Conditions of the Placing applicable to Placees Members of the public are not eligible to take part in the Placing. Theannouncement and the terms and conditions set out herein are directed only ateither (i) persons whose ordinary activities involve them in acquiring, holding,managing and disposing of investments (as principal or agent) for the purposesof their business and who have professional experience in matters relating toinvestments for the purposes of Article 19 of the Financial Services and MarketsAct 2000 (Financial Promotion) Order 2005, as amended (the "Order"); (ii)persons who are certified high net worth individuals for the purposes of Article48 of the Order; (iii) high net worth companies, unincorporated associations etcfor the purposes of Article 49 of the Order; or (iv) persons who aresophisticated investors for the purposes of Article 50 of the Order (in eachcase "Relevant Persons"). The announcement and the terms and conditions set outherein must not be acted on or relied on by persons who are not RelevantPersons. Any investment or investment activity to which the terms and conditionsset out herein relates is available only to Relevant Persons and will be engagedin only with Relevant Persons. Neither the announcement nor the terms andconditions set out herein constitute a public offer for sale or subscription ofany securities in the Company. Terms of the UK Placing Application will be made to the Exchange for the Placing Shares to be admittedto trading on AIM and it is expected that such trading will commence on 5th May2006 ("Admission"). The Placing Shares will, upon issue, be credited as fullypaid and will rank in full for all dividends and other distributions declared,made or paid on or after Admission and otherwise pari passu in all respects withthe existing Ordinary Shares. The Placing and the Placees' participation in it will be conditional on thePlacing Agreement becoming unconditional in all respects and not having beenterminated in accordance with its terms. The Placing Agreement is conditionalupon, inter alia, Admission occurring by not later than 8.00 am on 5 May 2006(or such later date as is agreed in writing between the Company and PanmureGordon & Co but not later than 31 May 2006). Panmure Gordon & Co may in their absolute discretion agree to extend or waivethe time for the satisfaction of certain of the conditions of the PlacingAgreement (provided that such time may not be extended beyond 31 May 2006). Inthe event that any such extension is agreed, Panmure Gordon & Co will inform thePlacees at the earliest opportunity and all subsequent dates mentioned in thisannouncement will be adjusted appropriately. By agreeing to participate in the Placing via a telephone conversation, Placeesaccept the terms and conditions set out herein which will constitute a bindingirrevocable commitment by a Placee, subject to the conditions set out below, tosubscribe or purchase and pay for the relevant number of Placing Shares, whichis not capable of termination or rescission by the Placee in any circumstancesexcept fraud. All such obligations are entered into by the Placee with PanmureGordon & Co in its capacity as agent for the Company and are therefore directlyenforceable by the Company. Termination Panmure Gordon & Co have the right to terminate the Placing Agreement (in theirabsolute discretion) if prior to Admission, inter alia: (i) any statementcontained in any press announcement has, in the reasonable opinion of PanmureGordon & Co, been discovered to be untrue, incorrect or misleading; or (ii)there has, in the reasonable opinion of Panmure Gordon & Co, been a breach ofany of the warranties contained in the Placing Agreement or any otherobligations on the part of the Company or the Directors under the PlacingAgreement which Panmure Gordon & Co reasonably considers to be material in thecontext of the Placing. By participating in the Placing and so accepting the obligations set out in theterms and conditions herein the Placee agrees that any exercise by PanmureGordon & Co of any right to terminate the Placing Agreement or to waive orextend any condition in the Placing Agreement shall be within Panmure Gordon &Co's absolute discretion and that Panmure Gordon & Co shall not have anyliability to the Placee whatsoever in connection with any decision to exerciseor not to exercise any such right. If the Placing Agreement does not becomeunconditional or is terminated in accordance with its terms prior to Admission,the Placing will not proceed and the Placee's rights and obligations will ceaseand no claims will be capable of being made by the Placee in respect of thePlacing and any payments made by the Placee will be returned as soon as possiblethereafter without interest. Settlement Settlement of transactions in the Placing Shares following Admission will takeplace within the CREST system against Panmure Gordon & Co's CREST account number83801. Placees will receive a conditional contract note from Panmure Gordon & Co whichwill be deemed to incorporate the terms and conditions contained in thisAppendix. Overseas shareholders No steps have been taken to enable any of the Placing Shares to be acquired byPlacees outside the United Kingdom. By participating in the Placing and soaccepting any offer incorporating the terms and conditions herein, the Placeerepresents and warrants that it is entitled to acquire the Placing Shares underthe laws and regulatory requirements of all relevant jurisdictions which applyto it, and that it has fully observed such laws and requirements and obtainedall governmental and other consents which may be required thereunder andcomplied with all necessary formalities and (save as set out below) will pay anyissue or other taxes due thereunder and that it has not taken any action whichwill or may result in the Company or Panmure Gordon & Co acting in breach of anyregulatory or legal requirements of any territory in connection with the Placingor the Placee's acceptance of the terms and conditions herein. The Placing Shares have not been and will not be registered under the SecuritiesAct under the securities law of any state of the United States nor have theybeen qualified for sale under the securities legislation of any province orterritory of Canada and the relevant exemptions are not being obtained from thesecurities commission of any province of Canada and accordingly, the PlacingShares may not be offered, sold, taken up, delivered or transferred (directly orindirectly) and will not qualify for sale within the United States or Canada orto, or for the account or benefit of, any person or corporation in (or with aregistered address in) the United States or Canada. The Placing Shares will not be lodged or registered with the AustralianSecurities and Investments Commission under Australia's Corporations Law and arenot being offered for subscription or sale and may not be directly or indirectlyoffered, sold or delivered in or into Australia or for the account or benefit ofany person or corporation in (or with a registered address in) Australia. No document in relation to the Placing Shares has been or will be lodged forregistration with the Registrar of Companies in the Republic of Ireland and thePlacing Shares will not be offered, sold or delivered, directly or indirectly inthe Republic of Ireland. All subscribers for, or purchasers of, Placing Sharesmust provide addresses outside the Republic of Ireland for the receipt ofcertificates for Placing Shares. The relevant clearances have not been, and will not be, obtained from theMinistry of Finance of Japan and no document in relation to the Placing has beenor will be lodged with or registered by the Ministry of Finance of Japan. ThePlacing Shares may not therefore be offered or sold, directly or indirectly, inor into Japan, its territories and possessions and any areas subject to itsjurisdiction. Tax The Placing Shares will be acquired by the Placee free of all expenses and freeof all stamp duty and stamp duty reserve tax ("SDRT") unless stamp duty or SDRTis chargeable on the issue of Placing Shares to the Placee under any of sections67 and 93 (Depository Receipts) or sections 70 or 96 (Clearance Services) of theFinance Act 1986. In summary, these sections will apply if the Placee's businessis or includes issuing depository receipts or the provision of clearanceservices or acting as agent or nominee for a person whose business is orincludes issuing depository receipts or the provision of clearance services. Byaccepting the terms and conditions herein the Placee confirms and warrants toPanmure Gordon & Co (for itself and as an agent for the Company) that thesesections will not apply to the placing of Placing Shares by it. If the Placee isnot able to confirm or warrant that the above sections apply or if any suchstamp duty or SDRT is payable, it will be entirely for the Placee's account andneither the Company nor Panmure Gordon & Co will have any liability in respectthereof. General This announcement is the sole responsibility of the Company. Panmure Gordon & Cois acting as nominated adviser and broker to the Company in relation to thePlacing. Panmure Gordon & Co will not be responsible to any person other thanthe Company for providing the protections afforded to the customers of PanmureGordon & Co (under the rules of the Financial Services Authority) nor foradvising any person other than the Company on the transactions and arrangementsreferred to in any press announcement. By participating in the Placing, each Placee irrevocably represents, warrantsand undertakes to Panmure Gordon & Co (for itself and as agent of the Company)that: a) it and/or each person on whose behalf it is participating (in whole or inpart) in the Placing or to whom it allocates its Placing Shares in whole or inpart: (i) has the capacity and authority and is entitled to enter into and perform itsobligations as a subscriber or purchaser of Placing Shares and will honour suchobligations, and (ii) has fully observed all laws of relevant jurisdictions and obtained allnecessary governmental or other consents in either case which may be required inrelation to the subscription or purchase by it of Placing Shares; b) it is not a person who is resident in, or a citizen of, the United States,Canada, Australia, the Republic of Ireland or Japan (or an agent or nominee ofsuch a person) or a corporation, partnership or other entity organised under thelaws of any such jurisdiction (or an agent or nominee of such a person); c) it is a Relevant Person; d) in accepting its Placing Commitment it is acting as principal and for noother person and that its acceptance of that participation will not give anyother person a contractual right to require the issue, or the transfer, of anyof the Placing Shares; e) it irrevocably confirms Panmure Gordon & Co's discretion with regard to thePlacing Agreement and agrees that Panmure Gordon & Co does not owe it any dutiesin respect of any claim it may have relating to the Placing; f) it acknowledges and agrees that the Placing Shares have not been and will notbe registered under the Securities Act or under the securities laws of any Stateof the United States, that the relevant clearances have not been and will not beobtained from the Securities Commission of any province of Canada and that thePlacing Shares have not been and will not be registered under the securitieslaws of Australia, the Republic of Ireland or Japan and, therefore, the PlacingShares may not be, subject to certain exceptions, directly or indirectly,offered or sold in the United States, Canada, Australia, the Republic of Irelandor Japan; g) it acknowledges and agrees that neither it nor any affiliate, nor any personacting on its or any affiliate's behalf, has or will offer, sell, take up,renounce, transfer or deliver directly or indirectly any Placing Shares withinthe United States, Canada, Australia, the Republic of Ireland or Japan or offer,sell, take up, renounce, transfer or deliver in favour of a resident of Canada,Australia, the Republic of Ireland or Japan; h) it has not offered or sold and will not offer or sell any Placing Shares inthe United Kingdom except to persons whose ordinary activities involve them inacquiring, holding, managing or disposing of investments (either as principal oragent) for the purposes of their business or otherwise in circumstances whichhave not resulted and will not result in offers to the public in the UnitedKingdom within the meaning of the Financial Services and Markets Act 2000; i) it acknowledges that it has complied with all relevant laws of allterritories, or obtained all requisite governmental or other consents which maybe required in connection with its participation in the Placing; that it hascomplied with all requisite formalities and that it has not taken any action oromitted to take any action which will or may result in Panmure Gordon & Co orthe Company or any of their directors, officers, agents, employees or advisorsacting in breach of the legal and regulatory requirements of any territory inconnection with the UK Placing or its application and that it is not in aterritory in which it is unlawful to make an offer to subscribe for, orpurchase, Placing Shares, or to accept such an offer; j) it acknowledges and agrees in connection with its participation in thePlacing that Panmure Gordon & Co is not acting for it in relation to the Placingor otherwise and that Panmure Gordon & Co will not have any duties orresponsibilities to it for providing the protections afforded to its customersor for advising it with regard to the UK Placing or the Placing Shares; k) it irrevocably appoints any director of Panmure Gordon & Co as its agent forthe purpose of executing and delivering to the Company and/or its registrars anydocuments on its behalf necessary to enable it to be registered as the holderof, or to purchase, any of the Placing Shares; l) it confirms that it has obtained all necessary consents and authorities toenable it to give its commitment to subscribe for or purchase Placing Shares andto perform its obligations as set out herein; m) it is not a person falling within subsections (6), (7) or (8) of section 67or subsections (2) and (3) of section 93 of the Finance Act 1986 (i.e. an issuerof depositary receipts) or subsections (6), (7) or (8) of section 70 orsubsection (1) of section 96 of the Finance Act 1986 (i.e. a provider ofclearance services) or an agent or nominee of either such person; n) the issue or transfer of Placing Shares to it (whether as principal, agent ornominee) will not be subject to stamp duty or SDRT at the increased ratesreferred to in sections 67 or 93 (Depositary Receipts) or sections 70 or 96(Clearance Services) of the Finance Act 1986; and o) the Placing Shares will be issued or transferred subject to the terms andconditions set out herein. A Placee will participate in the Placing by taking a Placing Commitment. These terms and conditions and all documents and agreements into which theseterms and conditions are incorporated by reference or otherwise will be governedby and construed in accordance with English law. - Ends - This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
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