EVRH.L Regulatory News (EVRH)

25 October 2017

NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, IN WHOLE OR IN PART, DIRECTLY OR INDIRECTLY, IN, INTO OR FROM THE UNITED STATES, AUSTRALIA, CANADA, JAPAN, THE REPUBLIC OF SOUTH AFRICA.

THIS ANNOUNCEMENT IS FOR INFORMATION PURPOSES ONLY AND DOES NOT CONSTITUTE OR CONTAIN ANY INVITATION, SOLICITATION, RECOMMENDATION, OFFER OR ADVICE TO ANY PERSON TO SUBSCRIBE FOR, OTHERWISE ACQUIRE OR DISPOSE OF ANY SECURITIES IN EVR HOLDINGS PLC OR ANY OTHER ENTITY IN ANY JURISDICTION. NEITHER THIS ANNOUNCEMENT NOR THE FACT OF ITS DISTRIBUTION, SHALL FORM THE BASIS OF, OR BE RELIED ON IN CONNECTION WITH ANY INVESTMENT DECISION IN RESPECT OF EVR HOLDINGS PLC.

This announcement contains inside information as defined in EU Regulation No. 596/2014 and is in accordance with the Company's obligations under Article 17 of that Regulation.

EVR Holdings plc

("EVR" or the "Company")

Proposed Placing to raise

£10 million for the Company and £5 million for selling shareholders

EVR Holdings (AIM: EVRH), one of the leading creators of virtual reality content, announces that is has conditionally raised £10 million (before expenses) by way of a placing of 125,000,000 new ordinary shares ("New Ordinary Shares") at a price of 8 pence per share (the "Placing Price"). In addition, Anthony Matchett and Steven Hancock (the "Selling Shareholders") have conditionally sold 31,250,000 and 31,250,000 existing Ordinary Shares ("Existing Shares") respectively at the Placing Price for an aggregate consideration of £5 million. The placing (the "Placing") of New Ordinary Shares and Existing Shares (together the "Placing Shares") was undertaken with existing and new institutional and other investors in the United Kingdom and the United States.

Details of the Placing

As part of the Placing, the Company has conditionally placed 125,000,000 New Ordinary Shares raising £10 million (before expenses) and the Selling Shareholders have conditionally sold a total of 62,500,000 Existing Shares for an aggregate of £5 million at the Placing Price. Following the sale Anthony Matchett and Steven Hancock will still retain over 80 per cent. of their original shareholdings, equating to 184,107,796 and 146,509,136 Ordinary shares in the Company respectively and are subject to a six month lock-up in respect of 50 per cent. of those shares and a 12 month lock-up in relation to the remaining 50 per cent., with certain customary exemptions.

The Placing Shares were offered to certain qualifying investors on the Company's and Selling Shareholders' behalf by the Company's broker, Zeus Capital Limited ("Zeus Capital") in the United Kingdom and the Company's broker Beech Hill Securities, Inc. ("Beech Hill Securities" together with Zeus Capital, the "Brokers") in the United States of America.

The Placing Price represents a discount of 1.54 per cent to the closing mid-market price of 8.125 pence per Ordinary Share on 24 October 2017, being the latest practicable date before this announcement.

The Placing is conditional on admission of the New Ordinary Shares to trading on AIM ("Admission"). Application has been made for the 125,000,000 New Ordinary Shares to be admitted on or around 27 October 2017. The New Ordinary Shares will represent approximately 10.80 per cent. of the enlarged share capital of the Company and will rank pari passu in all other respects with the Company's existing Ordinary Shares. The New Ordinary Shares are being issued pursuant to the existing shareholder authorities granted to the Company at the annual general meeting on 22 June 2017 and therefore the Placing does not require Shareholder approval.

Following Admission, the Company's enlarged issued share capital will comprise 1,157,614,265 Ordinary Shares of 1 pence each with voting rights in the Company. This figure may be used by shareholders in the Company as the denominator for the calculations by which they will determine if they are required to notify their interest in, or a change in the interest in, the share capital of the Company under the FCA's Disclosure and Transparency Rules.

The Placing is intended to enable MelodyVR to make further investments in its original content library as well as to extend the capacity of its live music capture and digital content creation capabilities both in the UK and overseas, expanding upon existing resources and infrastructure, increasing global marketing efforts as well as research and development in areas such as post production and camera technology.

Additional information on the Placing is included below.

Anthony Matchett, CEO of EVR said:

I am delighted to announce the completion of a successful and sizeable fundraise of £10 million, highlighting the significant progress that EVR has made over the past year. Throughout 2017, EVR and its subsidiary MelodyVR have continued to deliver upon operational targets and milestones, securing numerous partnerships with key market leaders operating throughout the music and technology industries, including Universal Music Group, Sony Music Entertainment, Roc Nation and Microsoft Corporation amongst others, adding to the existing deals already in place with Warner Music Group and other music rights holders.

As our company continues to expand, the Board firmly believes that the United States is a market of significant strategic importance and as part of this fundraise, I'm very pleased to welcome a number of the United States' most respected funds and institutions to our shareholder register. Having secured key institutional support from investors throughout the United States, MelodyVR will continue to expand US-centric operations and to further develop our capabilities and infrastructure within the country. As we continue to deliver on our goal of building a truly global music and entertainment business, we look towards the United States as a fertile environment for our growth that we believe will become a key factor in the long-term success of our company. I would also like to thank our investors within the United Kingdom for their on-going support and I'm pleased to welcome participation from both new and existing funds and institutions.

The capital raised as part of this placing will be used to further accelerate our expansion and will enable MelodyVR to enter new foreign markets including territories throughout Asia, Australasia and Latin America more quickly, further extending our market-leading position and generating additional opportunities for content creation and revenue generation worldwide. In support of our initiatives to broaden the institutional representation across our share register, the company intends to further strengthen its leadership team with the appointment of internationally experienced professionals, as non-executive directors, who will bring a wealth of relevant global commercial and corporate experience to the Board.

I look forward to updating the market on our ongoing progress as we continue to prepare for the global launch of the MelodyVR platform.

Placing Statistics

For further information:

Certain information contained within this announcement is deemed to constitute inside information for the purposes of Article 7 of EU Regulation 596/2014 ("MAR"). In addition and as permitted by MAR, market soundings (as defined in MAR) were taken in respect of the Placing with the result that certain persons became aware of inside information (as defined in MAR). Upon publication of this announcement via a Regulatory Information Service, this inside information is now considered to be in the public domain. Accordingly, those persons that received inside information in a market sounding are no longer in possession of such inside information relating to the Company and its securities.

Notes to Editors:

MelodyVR

MelodyVR is a wholly owned subsidiary of EVR Holdings plc ("EVR"), a company that is listed on the AIM market of the London Stock Exchange under the ticker EVRH.L. EVR, a creator of virtual reality content, joined AIM on 16 May 2016 following a reverse takeover of Armstrong Ventures plc. Further information can be viewed at www.evrholdings.com.

Virtual Reality in 2017

The virtual reality industry is growing at a significant rate following the launches of Oculus Rift, Playstation VR and HTC Vive. Goldman Sachs estimate that the market could be worth US$80bn by 2025.

Additional information on the Placing

1. Background to and reasons for the Placing and use of proceeds

June 2017 saw MelodyVR complete a Global Partnership with Microsoft Corporation. As part of the agreement, Microsoft provided MelodyVR with additional funding and technical expertise in order to secure the launch of the MelodyVR platform on all forthcoming 'Windows Mixed Reality' devices, which have been created in partnership with companies such as Acer, Dell, HP and Lenovo. MelodyVR has also agreed that Microsoft may actively market the MelodyVR app, primarily to their 500 million Windows 10 consumers, as well as at Microsoft branded events and within their retail stores. The completion of this Global Partnership, combined with the detailed marketing commitments, demonstrates the demand for MelodyVR's music platform and content, from both a key VR hardware developer and the world's largest software company. 

Following the Global Partnership with Microsoft, MelodyVR will now seek to enter into further agreements with leading VR hardware and smartphone manufacturers such as Facebook, Samsung, Google, HTC and Sony PlayStation amongst others, further increasing the breadth and reach of MelodyVR.

Also in June 2017, additional funding enabled MelodyVR to focus on deepening content creation with a number of the world's most recognisable artists and musicians. This has enhanced and enriched its already significant library of original VR content assets, in anticipation of the launch of its platform which will be timed to benefit from the significant sales of consumer devices anticipated over the holiday period. Alongside content creation, MelodyVR has also supplemented its core team with a number of key hires, both in the UK and across the Atlantic where MelodyVR's increased presence will further increase the capacity for content creation and distribution.

This Placing will enable MelodyVR to continue to make further investments in its original content library as well as to extend the capacity of its live music capture and digital content creation capabilities both in the UK and overseas, expanding upon existing resources and infrastructure, increasing global marketing efforts as well as research and development in areas such as post production and camera technology.

2. Details of the Placing

Structure

The Directors have given careful consideration as to the structure of the proposed Placing and have concluded that the Placing is the most suitable option available to the Company at this time on account of cost, timing and certainty.

The Placing has conditionally raised funds of £10.0 million gross (£9.6 million net of expenses) for the Company with 125,000,000 New Ordinary Shares being issued at the Placing Price. In addition it is anticipated that 62,500,000 Existing Shares will be conditionally sold by the Selling Shareholders pursuant to the Placing at the Placing Price.

Conditions to the Placing

The Placing is conditional, inter alia, upon the following:

· Admission occurring by no later than 8.00 a.m. on 27 October 2017 (or such later times and/or dates as may be agreed between the Company and the Brokers, being no later than 8.00 a.m. on 24 November 2017); and

· the Placing Agreement becoming unconditional in all respects (save for the condition relating to Admission) and not having been terminated in accordance with its terms.

If the conditions set out above and in the Placing Agreement are not satisfied or waived, where capable of waiver, the Placing will lapse and the New Ordinary Shares will not be issued and the Existing Shares will not be sold and all monies received from investors in respect of the Placing Shares will be returned to them (at the investors' risk and without interest) as soon as possible thereafter.

Application for Admission

Application has been made to the London Stock Exchange for the New Ordinary Shares to be admitted to trading on AIM. Admission of the Placing Shares is expected to take place, and dealings on AIM are expected to commence, at 8.00 a.m. on 27 October 2017 (or such later time and/or dates as may be agreed between the Company and the Brokers).

3. Effect of the Placing

Upon completion of the Placing, the New Ordinary Shares will represent approximately 10.80 per cent. of the enlarged share capital. The New Ordinary Shares will, following Admission, rank pari passu in all respects with the existing Ordinary Shares and will carry the right to receive all dividends and distributions declared, made or paid on or in respect of the Ordinary Shares after Admission.

4. The Placing Agreement

On 25 October 2017, the Company entered into a Placing Agreement with Zeus Capital and Beech Hill Securities pursuant to which they were appointed as agent for the Company and the Selling Shareholders (in the UK and the US respectively) and each agent agreed to use reasonable endeavours to place the Placing Shares at the Placing Price.

The Placing Agreement is conditional upon, among other things, the conditions set out above and none of the warranties or undertakings given to the Brokers prior to Admission being or becoming untrue, inaccurate or misleading in any material respect.

The Placing Agreement contains customary warranties given by the Company in favour of the Brokers in relation to, inter alia, the accuracy of the information in this document and other matters relating to the Group and its business. In addition, the Company has agreed to indemnify the Brokers (and their respective affiliates) in relation to certain liabilities which they may incur in respect of the Placing. Certain customary warranties have been provided by the Selling Shareholders pursuant to the Placing Agreement.

Each of Zeus Capital and Beech Hill Securities have the right to terminate the Placing Agreement in certain circumstances prior to Admission. In particular, in the event of a material breach of the warranties or a material adverse change or if the Placing Agreement does not become unconditional.

Forward-looking statements

This announcement contains statements about EVR that are or may be deemed to be "forward-looking statements".

All statements, other than statements of historical facts, included in this announcement may be forward-looking statements. Without limitation, any statements preceded or followed by, or that include, the words "targets", "plans", "believes", "expects", "aims", "intends", "will", "may", "should", "anticipates", "estimates", "projects", "would", "could", "continue" or words or terms of similar substance or the negative thereof, are forward-looking statements. Forward-looking statements include, without limitation, statements relating to the following: (i) future capital expenditures, expenses, revenues, earnings, synergies, economic performance, indebtedness, financial condition, dividend policy, losses and future prospects and (ii) business and management strategies and the expansion and growth of the operations of EVR.

These forward-looking statements are not guarantees of future performance. These forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of any such person, or industry results, to be materially different from any results, performance or achievements expressed or implied by such forward-looking statements. These forward-looking statements are based on numerous assumptions regarding the present and future business strategies of such persons and the environment in which each will operate in the future. Investors should not place undue reliance on such forward-looking statements and, save as is required by law or regulation (including to meet the requirements of the AIM Rules, MAR, the Prospectus Rules and/or the FSMA), EVR does not undertake any obligation to update publicly or revise any forward-looking statements (including to reflect any change in expectations with regard thereto or any change in events, conditions or circumstances on which any such statement is based). All subsequent oral or written forward-looking statements attributed to EVR or any persons acting on their behalf are expressly qualified in their entirety by the cautionary statement above. All forward-looking statements contained in this announcement are based on information available to the Directors of EVR at the date of this announcement, unless some other time is specified in relation to them, and the posting or receipt of this announcement shall not give rise to any implication that there has been no change in the facts set forth herein since such date.

This announcement is not for publication or distribution, directly or indirectly, in or into the United States of America. This announcement does not constitute or form part of any offer of securities for sale or any solicitation of an offer to buy 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, and may not be offered or sold in the United States, except pursuant to an applicable exemption from registration. No public offering of securities is being made in the United States.