Iconic Labs Regulatory News (ICON)

9 October 2019

Iconic Labs Plc ("Iconic Labs" or the "Company")

Q&A Document

Iconic Labs (LSE:ICON), a multi-divisional new media and technology business, would like to clarify several queries from shareholders with regard to its strategy and operational matters; accordingly, it has compiled the following Q&A. 

Has any revenue been generated?

The Company is generating revenue and the extent of this will be reported in accordance with the statutory financial calendar. The Company's next results will be the interim results, which are due within three months of the September 30th period end. Additional information around revenues may be reported as part of operational updates and on an ad hoc basis at the Company's discretion.

What is the status of the £1 million contract?

The Board is finalising the exact payment details and is confident this will be concluded in the near term; the team has already started to initiate the plan in anticipation of its finalisation. Although finalising a contract of this size can typically take considerable time, the management share the frustration with Shareholders about the length of time this has taken and will continue to use their best endeavours to get it signed as soon as possible.

Are legacy issues sorted? Is that phase complete?

The Board believes it has identified all legacy issue and budgeted for any payments due. Accordingly, the team is now able to free up more time to implement the strategy and focus on business generation.

What was the cash and equity price of the Social Alchemist acquisition?

As stated in the announcement to the market, the consideration was undisclosed for commercial sensitivities, but the Board believe it to be synergistic and has the potential to be value accretive for the wider group.

When are Board members going to buy shares in the Company and has the renumeration been settled? 

The Board is operating on low renumeration and devoting its time to executing the Company's development strategy for the benefit of all stakeholders. The team will be remunerated going forward on the success of the business.

Can you clarify what tranches of the Financing Agreement you have taken (as announced in RNS of August) and do you envisage taking the remaining tranches? If so, what will this money pay for?

The Company announced the draw down agreement on 6 August. The Board anticipates drawing down on the remaining tranches to use for legacy debts, working capital and small acquisitions. As previously announced, some of this cash has been budgeted to pay for legacy debts incurred by the previous Widecells stem cell business. The working capital element enables the Company to execute its strategy on an ongoing basis. Additionally, it will allow Iconic Labs to execute synergistic acquisitions, like the previously announced GSN, which it will evaluate on a case by case basis.

Why was the 0.4p base price stated via RNS then ignored?

The floor price mechanism solely related to the historic EHGO/Widecells facility. While it did provide a floor price at which the convertible secured debentures were converted, it also led to the issuance of bonus or penalty shares, the result of which was that there was in effect an overall aggregate conversion price lower than the floor price. The Company only agreed to the mechanism due to and in respect of the inherited facility with EHGO and therefore does not intend to agree to such mechanisms going forward.

Would that £150k loan from Iconic Labs be from the EHGOS Fund financing

150k was leant to MCM to provide working capital for the Tab acquisition. The Company believes this transaction will provide significant revenue on a monthly retained revenue basis and also allow the Company to access a profit share which it believes will far exceed 150k. The 150k was budgeted within the last fundraising round as money that could be deployed by the Company on strategic partnerships, like that with MCM.

Is EHGO still forward selling shares?

As far as the Company is aware, EHGO is not forward selling.

Can you confirm when the next AGM will be held?

The next AGM will be held once the final results are published before 31 December 2019.

When is the official website launch?

The new website is being developed and this is targeted to be launched within six weeks. 

How many staff are working for you?

The Company currently has eight full time employees and is looking to build this as the business grows. It also employs contractors on a case by case basis to fulfil work specs and ensure that the on-going cost based is managed sensibly.

What is the status with Student Media Ventures?

Student media ventures was created as a potential vehicle for joint venture opportunities in the media industry. However, the board has decided that is no longer needed and it is in the process of being closed down.

What is the status with the publication of an updated shareholder register?

The Company enlisted the help of its registrar to clarify the identity of its shareholders. Although the registrar has contacted all nominees shown to own more than 3% of the Company' shares, not all nominees have responded to the registrar. This has meant that a current shareholder registrar is not complete at this time. The Company is working with the registrars and will update shareholders in due course.

When will the Company give another update?

The Company is planning to give an update regarding GSN and Social Alchemist in the near future.

**ENDS**

For further information, please visit the Company's website www.iconiclabs.co.uk, email IR@iconiclabs.co.uk or contact: