Altitude Group Regulatory News (ALT)

THIS ANNOUNCEMENT IS RESTRICTED AND IT IS NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, IN WHOLE OR IN PART, DIRECTLY OR INDIRECTLY, IN OR INTO THE UNITED STATES OR ANY OF ITS TERRITORIES, CANADA, JAPAN, THE REPUBLIC OF IRELAND, THE REPUBLIC OF SOUTH AFRICA OR AUSTRALIA OR ANY OTHER STATE OR JURISDICTION IN WHICH SUCH RELEASE, PUBLICATION OR DISTRIBUTION WOULD BE UNLAWFUL

Altitude Group plc

("Altitude" or the "Company")

Proposed placings of, in aggregate, 10,294,118 new Ordinary Shares at a price of 68 pence per share to raise £7.0 million

and

Acquisition of the membership-based trade group of independent promotional products distributors business of Advertising Industry Mastermind Group, LLC

Altitude Group plc (AIM: ALT), the operator of a leading marketplace for personalised products, is pleased to announce that it has entered into a binding asset purchase agreement (the "APA") for the acquisition of the membership-based trade group of independent promotional products distributors business of Advertising Industry Mastermind Group, LLC ("AI Mastermind") for a maximum consideration of US$5 million (the "Acquisition").

The Company also announces that it intends to issue 10,294,11 new ordinary shares of 0.4 pence each ("Ordinary Shares") in the capital of the Company (the "Placing Shares") at a price of 68 pence per share (the "Placing Price") to raise £7.0 million (the "Placings"). The Placings comprise a proposed firm placing of 5,334,525 Placing Shares (the "First Placing Shares") utilising the Company's existing shareholder authorities to issue new shares on a non-pre-emptive basis for cash (the "First Placing") and a conditional placing of 4,959,593 Placing Shares (the "Second Placing Shares") subject to shareholder approval at a general meeting ("General Meeting") (the "Second Placing"). A shareholder circular convening the General Meeting will be sent to Shareholders as soon as possible after the Placings have been announced.

Peter Hallett, Graeme Couturier, Martin Varley and Keith Edelman, directors of the Company, intend to participate in the Placings for approximately £250,000 in aggregate.

The Placing is being conducted through an accelerated bookbuilding process (the "Bookbuild") which will be launched immediately following this announcement, in accordance with the terms and conditions set out in appendix II to this announcement (which forms part of this announcement). finnCap Ltd is acting as sole broker in connection with the Placings.

A further announcement will be made once the Bookbuild is complete.

About AI Mastermind

AI Mastermind is the largest and fastest-growing promotional products distributor member group in the US, with 1,917 members (out of approximately 23,000 distributors across the US). Membership numbers have grown from 1,455 as at 31 December 2017 to 1,917 as at 31 December 2018, representing a 32% increase. Over the last 5 years AI Mastermind has delivered a CAGR for member numbers of 74% and for members' revenue of 87%. With a total estimated transaction value across the membership base of US$1.7 billion annually, the average transaction revenue per member equates to approximately US$870,000. 

Altitude's patented technology platform for distributors, which has a supply chain already built in and combines an e-commerce trading platform with a cloud based CRM and order management system, branded as ChannlPro, can be white labelled to any specific brand and enables Altitude to generate revenue through charging transactions fees on purchase orders processed on the platform. The first white labelled ChannlPro brand, "AIMPro", was launched in January 2018 to meet the requirements of the members of AI Mastermind.

The Acquisition will enable Altitude to monetise the entire US$1.7 billion throughput revenue pipeline that exists within the AI Mastermind distributor member group from both the distributor and supplier side.

AIMPro Update

Since the launch of AIMPro in January 2018 Altitude has established a US team focused on engagement and onboarding of AI Mastermind members to the AIMPro platform. Significant progress has been made with 23,994 orders totalling US$19.9 million transacted over the platform to 31 December 2018. This represents an average order value of US$830.

As at 31 December 2018, a total of 266 AI Mastermind members had placed at least one order on AIMPro (30 September 2018: 164) of which 207 had placed multiple orders (30 September 2018: 120). This represents 78% of active users placing multiple orders which demonstrates the very high repeat usage of the platform once a member is onboarded. In total 1,456 members are engaged with Altitude at some stage of the onboarding process (30 September 2018: 720) representing 76% of the total AI Mastermind membership (30 September 2018: 39%).

AI Mastermind member on-boarding

Supplier onboarding

As at 31 December 2018, there were 280 AI Mastermind preferred suppliers of which 70 were onboarded on to AIMPro. This is compared to the 193 preferred suppliers as at 30 September 2018 (of which 65 were onboarded). Current supplier penetration as a percentage of sales order value is 37%* and growing. The process of uploading the supplier product data to the AIMPro platform has been outsourced to India which will enable an increased rate of successful supplier onboarding going forward.

*AI Mastermind control group

Use of Proceeds

Under the terms of the APA, the consideration payable for the Acquisition will be a maximum of US$5 million comprising US$3.5 million payable in cash from the proceeds of the First Placing, US$750,000 to be satisfied by the issue of 959,559 new Ordinary Shares at the Placing Price and US$750,000 to be held in escrow for potential deferred consideration. 

In total the proceeds from the Placings will be used to:

· fund the cash portion of consideration, being US$4.25 million (c.£3.4 million);

· provide working capital to increase US operational resource, being US$3.75 million (c.£3.2 million); and

· pay the transaction expenses, being US$0.5 million (c.£0.4 million).

The information communicated in this announcement is inside information for the purposes of Article 7 of Regulation 596/2014 ("MAR"). In addition, market soundings (as defined in MAR) were taken in respect of the Placings with the result that certain persons became aware of inside information (as defined in MAR), as permitted by MAR. This inside information is set out in this Announcement. Therefore, 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.

Additional information on the Placings, the Acquisition and the Company is set out below in appendix I of this announcement (which forms part of this announcement). The information in appendix I will be included in a circular to Shareholders that will be posted to Shareholders and made available on the Company's website at www.altitudeplc.com once the result of the Placings have been announced.

In addition to the information included in this Announcement a copy of the Company's investor presentation is available on the Company's website at www.altitudeplc.com.

For further information please contact:

APPENDIX I

BACKGROUND TO AND UPDATE ON AIMPRO PROGRESS

The US$23 billion US promotional products market is highly fragmented with 42% of the market (approximately US$9.8 billion) conducted by 22,700 distributors with individual revenues of less than US$2.5 million per annum. The market is inefficient with an elongated supply chain and the majority of transactions initiated offline. More than 88.5% of orders placed by these smaller distributors are placed either face-to-face or by phone/fax/email with small distributors with the remaining 11.5% of orders processed online with smaller distributors.

This fragmented and inefficient market has resulted in the creation of distributor groups and mid-sized operators trying to counter the threat of large online retailers. Of these distributor groups AI Mastermind is by far the largest with an approximate $1.7 billion of aggregate revenues representing an approximate 7.4% market share.

ChannlPro

Altitude's solution to this problem is a patented technology platform for distributors which has a supply chain already built in and combines an e-commerce trading platform with a cloud-based CRM and order management system that enables both offline and online promotional product transactions to be executed. This combined offering, now branded as ChannlPro, can be white labelled to any specific brand and enables Altitude to generate revenue through charging transactions fees on purchase orders processed on the platform. The first white labelled ChannlPro brand, "AIMPro", was launched in January 2018 to meet the requirements of the members of AI Mastermind , a buying group who at that time consisted of 1,455 members.

AI Mastermind and AIMPro

Since January 2018, AI Mastermind has grown to 1,917 members with aggregate revenue of approximately US$1.7 billion making it by far the largest promotional product member group by gross revenue in the USA with an approximate market share of 7.4%.

The current AIMPro revenue model is based on AI Mastermind members transacting their sales and purchase orders on AIMPro where Altitude takes a fee from the suppliers. The AIMPro platform is provided to AI Mastermind distributor as part of their US$59 per month AI Mastermind membership fee. The current effective rate that Altitude is deriving from the supplier transaction fees is 2.49%* of sales order value source from contracted suppliers. This blended rate is reflective of the current offline dominance of orders and is expected to increase over time as the move to online accelerates.

*AI Mastermind control group

Member onboarding

Since the launch of AIMPro in January 2018 Altitude has established a permanent US engagement team to focus on engagement with and onboarding of AI Mastermind members to the AIMPro platform. Significant progress has been made with 23,994 orders totalling US$19.9 million transacted over the platform to 31 December 2018. This represents an average order value of US$830.

As at 31 December 2018, a total of 266 AI Mastermind members had placed at least one order on AIMPro (30 September 2018: 164) of which 207 had placed multiple orders (30 September 2018: 120). This represents 78% of active users placing multiple orders which demonstrates the very high repeat usage of the platform once a member is onboarded. In total 1,456 members are engaged with Altitude at some stage of the onboarding process (30 September 2018: 720) representing 76% of the total AI Mastermind membership (30 September 2018: 39%).

AI Mastermind member on-boarding progress

Accelerating the rate at which AI Mastermind members are onboarded and engaged in using AIMPro as their primary order processing tool is key to growing the gross transactional revenue through the platform. Altitude's management data demonstrates that active management of AI Mastermind members through the onboarding process increases the speed of adoption of AIMPro by AI Mastermind members and their total order volume and directly influences order frequency. Since the addition of the US engagement team the ordering member statistics have increased to a 35% monthly increase, with adoption rates after initial contact rising to 80%.

Supplier onboarding

As at 31 December 2018, there were 280 AI Mastermind preferred suppliers of which 70 were onboarded on to AIMPro. This is compared to the 193 preferred suppliers as at 30 September 2018 (of which 65 were onboarded). Current supplier penetration as a percentage of sales order value is 37%* and growing. The process of uploading the supplier product data to the AIMPro platform has been outsourced to India which will enable an increased rate of successful supplier onboarding going forward.

Under the current model Altitude derives gross transaction revenue by charging transaction fees to the suppliers and so increasing the total penetration levels of onboarded suppliers is key to growing gross transaction revenue.

*AI Mastermind member control group

2019 focus

Gross transactional revenue for Altitude is driven by onboarded AI Mastermind member distributors transacting on AIMPro with onboarded AI Mastermind preferred suppliers. Regular interaction between AI Mastermind members and Altitude's dedicated customer service engagement team is proven to lead to increased order throughput and therefore the acceleration of onboarding and engagement with both AI Mastermind distributor members and AI Mastermind preferred suppliers will drive growth in gross transactional revenue.

Additional investment in US resource personnel will enable:

i. accelerated onboarding of AI Mastermind distributor members to AIMPro;

ii. enhanced ongoing engagement with onboarded members to encourage order processing and repeat orders; and

iii. accelerated onboarding of AI Mastermind preferred suppliers.

BACKGROUND TO AND REASONS FOR THE ACQUISITION AND THE PLACINGS

Acquisition

The Acquisition will enable Altitude to control and therefore monetise the entire US$1.7 billion throughput revenue pipeline that exists within the AI Mastermind distributor member group from both the distributor and supplier side.

In particular the Acquisition will enable Altitude to:

· Access and enhance distributor membership fee revenue:

o Add existing AI Mastermind distributor membership fees at US$59 per member per month;

o Introduce a tiered membership structure which will provide the opportunity to offer material added value services;

· Remove the existing revenue share with AI Mastermind which will improve AIMPro's gross margin;

· Bill suppliers accurately and on a timely basis via the monthly data synchronisation of all orders placed by distributor members;

· Secure the AI Mastermind partnership in perpetuity; and

· Give Altitude the opportunity to apply its broader group infrastructure to directly drive growth of AI Mastermind and tap the pipeline for additional revenue.

The introduction of the tiered membership structure will enable the existing fee revenue available from the distributor members to be materially enhanced in return for the provision of additional service offerings. These enhanced service levels are already being requested by a number of AI Mastermind members and it is usual for such services to attract additional fees in the US market. Altitude intends to introduce a 3-tiered system.

Tier 1 - US$59 per member per month

Tier 1 will represent the standard AI Mastermind membership. However, all members will be required to send data via EasySync meaning all orders are captured and invoiceable to the AIMPro preferred supplier regardless of how or where the order is processed. The average percentage GTR gained by AIMPro is dependent on the member throughput, and influenced by whether it is derived online (at a higher rate) or offline.

Tier 2 - US$59 per member per month plus a percentage of gross transaction value

Tier 2 customers gain further benefits from enhanced membership including a full order processing system and quotes system, supplier follow up, some artwork and digitisation, and weekly social media posting. The cost to the member will include the base membership fee of US$59 per month plus a percentage of their gross transaction value.

Tier 3 - US$59 per member per month plus a higher percentage of gross transaction value

Tier 3 customers benefit from full business management, full customer service support, full artwork/digitisation, and enhanced healthcare and retirement benefit packages. The cost to the member will include the base membership fee of US$59 per month plus a higher percentage of their gross transactional value.

As an added incentive for AI Mastermind members to use AI Mastermind preferred suppliers (from whom Altitude currently derives gross transactional revenue from) when placing their orders on AIMPro, Tier 2 and Tier 3 members will receive a modest rebate on their additional percentage charges on orders placed with an AI Mastermind preferred supplier.

Working Capital

The Company also requires additional working capital in order to accelerate the roll out of AIMPro to AI Mastermind members and to accelerate the onboarding of both AI Mastermind distributor members and AI Mastermind preferred suppliers. Gross transactional revenue through AIMPro is driven by onboarded AI Mastermind member distributors transacting on AIMPro with onboarded AI Mastermind preferred suppliers. Regular interaction between AI Mastermind members and Altitude's dedicated customer service engagement team is proven to lead to increased order throughput and therefore the acceleration of onboarding and engagement with both AI Mastermind distributor members and AI Mastermind preferred suppliers will drive growth in gross transactional revenue.

Additional investment in US resource personnel will enable:

i. accelerated onboarding of AI Mastermind distributor members to AIMPro;

ii. enhanced ongoing engagement with onboarded members to encourage order processing and repeat orders;

iii. accelerated onboarding of AI Mastermind preferred suppliers; and

iv. the leveraging opportunity afforded by the Acquisition.

INFORMATION ON AI MASTERMIND

AI Mastermind is the largest and fastest-growing promotional products distributor member group in the US, with 1,917 members (out of approximately 23,000 distributors across the US). Membership numbers have grown from 1,455 as at 31 December 2017 to 1,917 as at 31 December 2018, representing a 32% increase. Over the last 5 years AI Mastermind has delivered a CAGR for member numbers of 74% and for members' revenue of 87%. With a total estimated transaction value across the membership base of US$1.7 billion annually, the average transaction revenue per member equates to approximately US$870,000.

AI Mastermind currently charges distributor members US$59 per member per month, of which AI Mastermind currently retains on average US$21 after paying away member finder's fees due to a third party. A benefit of AI Mastermind Membership includes free access to the AIMPro Tech Suite including the benefits of Altitude's ChannlPro platform in addition to the AI Mastermind membership aggregation benefits of advantageous pricing, discounts on shipping, healthcare, travel, office supply and business insurance, and community networking.

FINANCIAL INFORMATION ON THE BUSINESS

The trading record of the Business for the eleven months ended 5 December 2018 and the 12 months ended 31 December 2017 as extracted from the Vendor's financial statements and records and is summarised below:

TERMS OF THE ACQUISITION

The Acquisition will be made pursuant to the Acquisition Agreement. Under this, AIM Smarter, has agreed to acquire AI Mastermind for a maximum consideration of US$5 million comprising (i) US$3.5 million payable in cash on Completion, (ii) US$750,000 to be satisfied by the issue of 959,559 new Ordinary Shares in the Company at the Placing Price and (iii) US$750,000 (the "Escrow Amount") to be held in escrow for a period of 18 months following Completion in order to secure the performance of the Vendor's post-closing obligations under the Acquisition Agreement including dealing with one contractual arrangement and ensuring membership retention. Up to 75% of the Escrow Amount will be released to the Vendor in stages 6, 12 and 18 months following Completion upon achievement of certain benchmarks relating to membership retention.

Under the Acquisition Agreement, the Acquisition is conditional, inter alia, on the First Placing being successfully completed and First Admission. The Acquisition Agreement contains the usual warranties in relation to the Business in favour of the Company and the Vendor and Jamie Coggeshall, the sole member of the Vendor and Founder of AI Mastermind, have given non-competition and non-solicitation undertakings for a period of 36 months following Completion.

The Vendor has agreed to enter into a lock-in agreement pursuant to which it has undertaken to the Company and to finnCap that, subject to certain exceptions (including the ability to transfer shares to Jamie Coggeshall and his wife), it will not sell or otherwise dispose of, or agree to sell or dispose of, any of its interest in the Ordinary Shares held by it and its connected persons at any time during the period of 12 months following Admission. In addition, certain orderly market provisions will apply for a further period of 12 months after expiry of the 12 month lock-in period.

Jamie Coggeshall has agreed to remain as President of AI Mastermind for a period of three years from Completion and an agreement to this effect has been entered into.

DETAILS OF THE PLACINGS

The Company is proposing to raise £7.0 million (before expenses) through the issue of the Placing Shares at the Placing Price. The Placing Price represents a discount of approximately 9.3 per cent. to the closing mid-market price of 75.0 pence per Ordinary Share on 10 January 2019, being the Last Practicable Date. The Placing Shares will represent approximately 15.6 per cent. of the Enlarged Issued Share Capital (the Enlarged Issued Share Capital being 65,943,311 Ordinary Shares representing the Existing Issued Share Capital, the First Placing Shares, the Second Placing Shares and the Consideration Shares).

finnCap has entered into the Placing Agreement with the Company whereby finnCap has agreed, as agent for and on behalf of the Company, to use its reasonable endeavours to procure subscribers for the Placing Shares at the Placing Price conditionally upon, inter alia:

· the Placing Agreement becoming unconditional and not being terminated by finnCap in accordance with its terms;

· in respect of the First Placing, the Acquisition Agreement having become unconditional in all respects;

· in respect of the Second Placing, the Resolutions having been passed without amendment;

· First Admission of the First Placing Shares becoming effective by not later than 8.00 a.m. on 17 January 2019 (or such later time and/or date as finnCap and the Company may agree, but not later than 8.00 a.m. on 31 January 2019); and

· Second Admission of the Second Placing Shares becoming effective by not later than 8.00 a.m. on 31 January 2019 (or such later time and/or date as finnCap and the Company may agree, but not later than 8.00 a.m. on 28 February 2019).

finnCap may in its absolute discretion waive the conditions referred to above, other than that relating to First Admission and Second Admission.

Under the Placing Agreement, certain warranties have been given by the Company to finnCap concerning, inter alia, the accuracy of this document and the presentation to potential investors (together, the "Placing Documents"), the affairs of the Company and certain taxation and other matters, and certain indemnities have been given by the Company in relation to finnCap's involvement in the Placings, First Admission and Second Admission.

The Placing Agreement will be capable of being terminated by finnCap at its absolute discretion at any time before First Admission and/or Second Admission if, inter alia, (i) any statement in the Placing Documents has become untrue, inaccurate, incomplete in any material respect or misleading or matters have arisen which would, if the Placing Documents were issued at that time, constitute an omission from them; or (ii) any warranty in the Placing Agreement would, if repeated at First Admission or Second Admission (as the case may be), be untrue, inaccurate or misleading in any respect; or (iii) there have occurred certain force majeure events which in the sole judgement of finnCap prejudice the success of the Placings, or which makes it, in the sole judgement of finnCap, impractical to proceed with the Placings and/or either Admission and/or to market Ordinary Shares on the terms and in the manner set out in the Placing Documents.

For the avoidance of doubt, finnCap is not underwriting the Placings.

CURRENT TRADING OF THE COMPANY

A copy of the Company's trading update released on 27 November 2018 can be found on the Company's website at www.altitudeplc.com.

Since that time the Company has continued to make progress with the roll-out of the AIMPro platform to AI Mastermind distributor members and AI Mastermind preferred suppliers. Full details of the most recent statistics in relation to this can be found above.

USE OF PROCEEDS

The proceeds from the Placings will be used to:

· fund the cash portion of consideration, being US$4.25 million (c.£3.4 million);

· provide working capital to increase US operational resource, being US$3.75 million (c.£3.2 million); and

· pay the transaction expenses, being US$0.5 million (c.£0.4 million).

IRREVOCABLE UNDERTAKINGS

Insofar as they are interested in Ordinary Shares, the Directors have given irrevocable undertakings to the Company to vote in favour of the Resolutions (and, where relevant, to procure that such action is taken by the relevant registered holders if that is not them), in respect of their entire beneficial holdings totalling, in aggregate, 12,939,465 Ordinary Shares, representing approximately 23.66 per cent. of the Company's issued share capital.

In addition, certain other Shareholders, being Simon Taylor and Keith Willis, have given irrevocable undertakings to the Company to vote in favour of the Resolutions to be proposed at the General Meeting (and, where relevant, to procure that such action is taken by the relevant registered holders if that is not one of them) in respect of their beneficial holdings totalling, in aggregate, 10,453,273 Ordinary Shares, representing approximately 19.11 per cent. of the Company's existing issued share capital.

In total, therefore, the Company has received irrevocable undertakings and a letter of intent to vote in favour of the Resolutions in respect of holdings totalling in aggregate 23,392,738 Ordinary Shares, representing approximately 42.77 per cent. of the Company's existing issued share capital.

APPENDIX I DEFINITIONS

APPENDIX II - TERMS AND CONDITIONS OF THE PLACINGS

IMPORTANT INFORMATION FOR INVITED PLACEES ONLY REGARDING THE PLACINGS.

THIS ANNOUNCEMENT (INCLUDING THIS APPENDIX) (TOGETHER, THE "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 OR INTO THE UNITED STATES OR ANY OF ITS TERRITORIES, CANADA, JAPAN, THE REPUBLIC OF IRELAND, THE REPUBLIC OF SOUTH AFRICA OR AUSTRALIA OR ANY OTHER STATE OR JURISDICTION IN WHICH SUCH RELEASE, PUBLICATION OR DISTRIBUTION WOULD BE UNLAWFUL.

MEMBERS OF THE PUBLIC ARE NOT ELIGIBLE TO TAKE PART IN THE PLACINGS. ALL OFFERS OF THE PLACING SHARES WILL BE MADE PURSUANT TO AN EXEMPTION UNDER DIRECTIVE 2003/71/EC (AND AMENDMENTS THERETO), AND INCLUDING ANY RELEVANT IMPLEMENTING MEASURE, IN THE RELEVANT MEMBER STATE OF THE EUROPEAN ECONOMIC AREA ("EEA")) (THE "PROSPECTUS DIRECTIVE"), FROM THE REQUIREMENT TO PRODUCE A PROSPECTUS FOR OFFERS OF THE PLACING SHARES. THIS ANNOUNCEMENT AND THE TERMS AND CONDITIONS SET OUT IN THIS ANNOUNCEMENT ARE FOR INFORMATION PURPOSES ONLY AND ARE DIRECTED ONLY AT PERSONS WHO ARE: (A) PERSONS IN AN EEA MEMBER STATE WHICH HAS IMPLEMENTED THE PROSPECTUS DIRECTIVE (A "RELEVANT MEMBER STATE"), UNDER THE FOLLOWING EXEMPTIONS UNDER THE PROSPECTUS DIRECTIVE, IF AND TO THE EXTENT THEY HAVE BEEN IMPLEMENTED IN THAT RELEVANT MEMBER STATE: (I) TO ANY LEGAL ENTITY WHICH IS A "QUALIFIED INVESTOR" AS DEFINED IN THE PROSPECTUS DIRECTIVE; (II) TO FEWER THAN 150 NATURAL OR LEGAL PERSONS (OTHER THAN QUALIFIED INVESTORS AS DEFINED IN THE PROSPECTUS DIRECTIVE), AS PERMITTED UNDER THE PROSPECTUS DIRECTIVE; OR (III) IN ANY OTHER CIRCUMSTANCES WHICH DO NOT REQUIRE THE PUBLICATION BY THE COMPANY OF A PROSPECTUS PURSUANT TO ARTICLE 3 OF THE PROSPECTUS DIRECTIVE, PROVIDED THAT NO SUCH OFFER TO THE PUBLIC SHALL RESULT IN A REQUIREMENT FOR THE PUBLICATION BY THE COMPANY OR FINNCAP OF A PROSPECTUS PURSUANT TO ARTICLE 3 OF THE PROSPECTUS DIRECTIVE; AND (B) (I) INVESTMENT PROFESSIONALS FALLING WITHIN ARTICLE 19(5) OF THE FINANCIAL SERVICES AND MARKETS ACT 2000 (FINANCIAL PROMOTION) ORDER 2005, (THE "ORDER"); OR (II) HIGH NET WORTH COMPANIES, UNINCORPORATED ASSOCIATIONS AND OTHER PERSONS FALLING WITHIN ARTICLE 49(2)(A) TO (D) OF THE ORDER (ALL SUCH PERSONS TOGETHER BEING REFERRED TO AS "RELEVANT PERSONS").

EACH PLACEE SHOULD CONSULT WITH ITS OWN ADVISERS AS TO THE LEGAL, TAX, BUSINESS AND RELATED ASPECTS OF A SUBSCRIPTION FOR PLACING SHARES.

This Announcement is for information purposes only and does not constitute an offer to sell or issue or the solicitation of an offer to buy, subscribe for or otherwise acquire any Placing Shares in any jurisdiction in which any such offer or solicitation would be unlawful.

All offers of the Placing Shares will be made pursuant to an exemption under the Prospectus Directive from the requirement to produce a prospectus. This Announcement is being distributed and communicated to persons in the UK only in circumstances to which section 21(1) of the Financial Services and Markets Act 2000 (the "FSMA") does not apply.

The Placing Shares referred to in this Announcement have not been and will not be registered under the US Securities Act of 1933, as amended (the "Securities Act"), or under the securities laws of any state or other jurisdiction of the United States, and may not be offered, sold or transferred in, into or within the United States except pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act and the securities laws of any relevant state or other jurisdiction of the United States. There will be no public offer of the Placing Shares in the United States.

The distribution of this Announcement and the Placings and/or issue of the Placing Shares in certain jurisdictions may be restricted by law. No action has been taken by the Company, finnCap or any of their respective affiliates that would permit an offer of the Placing Shares or possession or distribution of this Announcement or any other offering or publicity material relating to such Placing Shares in any jurisdiction where action for that purpose is required. Persons into whose possession this Announcement comes are required by the Company and finnCap to inform themselves about and to observe any such restrictions.

This Announcement should be read in its entirety. In particular, you should read and understand the information provided in the "Important Notices" section of this Announcement.

By participating in the Bookbuild and the Placings, Placees will be deemed to have read and understood this Announcement in its entirety, to be participating, making an offer and acquiring Placing Shares on the terms and conditions contained in this Appendix and to be providing the representations, warranties, indemnities, acknowledgements and undertakings contained in this Appendix. In particular, each such Placee represents, warrants, undertakes, agrees and acknowledges (amongst other things), that:

1. it is a Relevant Person and undertakes that it will acquire, hold, manage or dispose of any Placing Shares that are allocated to it for the purposes of its business;

 2. in the case of a Relevant Person in a Relevant Member State who acquires any Placing Shares pursuant to the Placings:

a. it is a Qualified Investor; and

b. in the case of any Placing Shares acquired by it as a financial intermediary, as that term is used in Article 3(2) of the Prospectus Directive:

i. the Placing Shares acquired by it in the Placings have not been acquired on behalf of, nor have they been acquired with a view to their offer or resale to, persons in any Relevant Member State other than Qualified Investors or in circumstances in which the prior consent of finnCap has been given to the offer or resale; or

ii. where Placing Shares have been acquired by it on behalf of persons in any member state of the EEA other than Qualified Investors, the offer of those Placing Shares to it is not treated under the Prospectus Directive as having been made to such persons;

3. it is acquiring the Placing Shares for its own account or is acquiring the Placing Shares for an account with respect to which it exercises sole investment discretion and has the authority to make and does make the representations, warranties, indemnities, acknowledgements and agreements contained in this Announcement;

 4. it understands (or, if acting for the account of another person, such person understands) the resale and transfer restrictions set out in this Appendix; and

5. it (and any account referred to in paragraph 3 above) is either (i) located outside the United States and acquiring the Placing Shares in an "offshore transaction" as defined in and in accordance with Regulation S under the Securities Act or (ii) within the United States and is a "qualified institutional buyer" as defined in Rule 144A under the Securities Act (a "QIB").

No prospectus

No prospectus or other offering document has been or will be submitted to be approved by the Financial Conduct Authority ("FCA") in relation to the Placings and Placees' commitments will be made solely on the basis of the information contained in this Announcement, the announcement of the completion of the Placings through a Regulatory Information Service (the "Placing Results Announcement") and any information publicly announced through a Regulatory Information Service (as defined in the listing rules of the FCA) by or on behalf of the Company on or prior to the date of this Announcement (the "Publicly Available Information") and subject to any further terms set forth in the contract note or trade confirmation sent to individual placees. Each Placee, by participating in the Placings

, agrees that it has neither received nor relied on any information, representation, warranty or statement made by or on behalf of finnCap or the Company other than the Publicly Available Information and none of finnCap, the Company nor any person acting on such person's behalf nor any of their affiliates has or shall have any liability for any Placee's decision to participate in the Placings based on any other information, representation, warranty or statement. Each Placee acknowledges and agrees that it has relied on its own investigation of the business, financial or other position of the Company in accepting a participation in the Placings. Nothing in this paragraph shall exclude the liability of any person for fraudulent misrepresentation.

Details of the Placing Agreement and the Placing Shares

finnCap expects to enter into a Placing Agreement (the "Placing Agreement" being the agreement relating to the Placings to be entered into between the Company and finnCap) with the Company under which it has undertaken, on the terms and subject to the conditions set out in the Placing Agreement, to use reasonable endeavours to procure Placees for the Placing Shares.

The Placing Shares (comprising the First Placing Shares and Second Placing Shares) will, when issued, be credited as fully paid and will rank pari passu in all respects with the existing ordinary shares in the capital of the Company, including the right to receive all dividends and other distributions declared, made or paid in respect of such ordinary shares after the date of issue of the relevant Placing Shares.

Application for admission to AIM and trading

Application is being been made to the London Stock Exchange for (a) First Admission of the First Placing Shares, and (b) Second Admission of the Second Placing Shares, to trading on the AIM market of the London Stock Exchange ("AIM") (each and together "Admission").

It is expected that (a) First Admission will take place on or before 8.00 a.m. (London time) on 17 January 2019 and that dealings in the First Placing Shares on AIM will commence at the same time and (b) Second Admission will take place on or before 8.00 a.m. (London time) on 31 January 2019 and that dealings in the Second Placing Shares on AIM will commence at the same time.

Bookbuild

finnCap will today commence the Bookbuild to determine demand for participation in the Placings by Placees. This Appendix gives details of the terms and conditions of, and the mechanics of participation in, the Placings. No commissions will be paid to Placees or by Placees in respect of any Placing Shares.

Principal terms of the Bookbuild and Placings

finnCap is acting as Nominated Adviser and sole bookrunner and broker of the Company in connection with the Placings.

Participation in the Placings will only be available to persons who may lawfully be, and are, invited by finnCap to participate.

The Placing Price is 68 pence and the number of Placing Shares to be issued and the allocation of Placing Shares among the Placees will be determined by finnCap in its absolute discretion but in making such determination, finnCap shall consult with the Company and shall consider in good faith any comments which the Company may have in respect of such allocaitons. The number of Placing Shares to be issued will be announced through the Closing Announcement following the completion of the Bookbuild.

To bid in the Bookbuild, Placees should communicate their bid by telephone to their usual sales contact at finnCap. Each bid should state the number of Placing Shares which a prospective Placee wishes to acquire at the Placing Price. Bids may be scaled down by finnCap on the basis referred to below.

The Bookbuild is expected to close no later than 4 p.m. (London time) on 14 January 2019 but may be closed earlier or later at the discretion of finnCap. finnCap may, in agreement with the Company, accept bids that are received after the Bookbuild has closed. The Company reserves the right to reduce the amount to be raised pursuant to the Placings, in agreement with finnCap.

An offer to acquire Placing Shares, which has been communicated by a prospective Placee to finnCap which has not been withdrawn or revoked prior to publication of this Announcement shall not be capable of withdrawal or revocation immediately following the publication of this Announcement without the consent of finnCap.

Each Placee's allocation will be determined by finnCap and will be confirmed orally by finnCap as soon as practicable following the close of the Bookbuild. finnCap's oral confirmation of an allocation will give rise to a legally binding commitment by the Placee concerned, in favour of finnCap and the Company, under which it agrees to acquire the number of Placing Shares allocated to it on the terms and subject to the conditions set out in this Appendix and the Company's articles of association. Each Placees' allocation in the First Placing and the Second Placing shall be made pro rata to the size of that Placees' participation, subject always to the final determination of finnCap in its absolute discretion.

The Company will release the Closing Announcement following the close of the Bookbuild, detailing the aggregate number of the Placing Shares to be issued at the Placing Price.

Each Placee's allocation and commitment will be evidenced by a contract note or trade confirmation issued to such Placee by finnCap (this shall also set out that Placee's allocation across the First Placing and the Second Placing). The terms of this Appendix will be deemed incorporated therein.

finnCap may choose to accept bids, either in whole or in part, on the basis of allocations determined at its discretion with agreement of the Company) and may scale down any bids for this purpose on such basis as they may determine or be directed. finnCap may also, notwithstanding the paragraphs above, (a) allocate Placing Shares after the time of any initial allocation to any person submitting a bid after that time and (b) allocate Placing Shares after the Bookbuild has closed to any person submitting a bid after that time.

A bid in the Bookbuild will be made on the terms and subject to the conditions in this Appendix and will be legally binding on the Placee on behalf of which it is made and, except with finnCap's consent, will not be capable of variation or revocation after the time at which it is submitted. Each Placee will have an immediate, separate, irrevocable and binding obligation, owed to finnCap, to pay to it (or as it may direct) in cleared funds an amount equal to the product of the Placing Price and the number of Placing Shares such Placee has agreed to acquire and the Company has agreed to allot and issue to that Placee.

Except as required by law or regulation, no press release or other announcement will be made by finnCap or the Company using the name of any Placee (or its agent), in its capacity as Placee (or agent), other than with such Placee's prior written consent.

Irrespective of the time at which a Placee's allocation(s) pursuant to the Placings is/are confirmed, settlement for all Placing Shares to be acquired pursuant to the Placings will be required to be made at the same time, on the basis explained below under 'Registration and Settlement'.

All obligations under the Bookbuild and the Placings will be subject to fulfilment of the conditions referred to below under "Conditions of the Placings" and to the Placings not being terminated on the basis referred to below under "Termination of the Placings".

By participating in the Bookbuild each Placee will agree that its rights and obligations in respect of the Placings will terminate only in the circumstances described below and will not be capable of rescission or termination by the Placee.

To the fullest extent permissible by law, neither finnCap nor any of its affiliates nor any of its or its affiliates' agents, directors, officers or employees shall have any liability to Placees (or to any other person whether acting on behalf of a Placee or otherwise). In particular, neither finnCap nor any of its affiliates nor any of its or their agents, directors, officers or employees shall have any liability (including, to the extent permissible by law, any fiduciary duties) in respect of finnCap's conduct of the Bookbuild or of such alternative method of effecting the Placings as finnCap and the Company may agree.

Registration and Settlement

If Placees are allocated any Placing Shares in the Placings, they will be sent a contract note or trade confirmation which will confirm the number of First Placing Shares and Second Placing Shares at the Placing Price allocated to them and the aggregate amount owed by them to finnCap. Each Placee will be deemed to agree that it will do all things necessary to ensure that delivery and payment is completed in accordance with either the standing CREST or certificated settlement instructions which they have in place with finnCap or otherwise as finnCap may direct.

Settlement of transactions in the Placing Shares (ISIN: GB00BM4NV50) following both First Admission and Second Admission (as the case may be) will take place within the CREST system. Settlement through CREST in respect to the First Placing will be on a T+4 basis unless otherwise notified by finnCap and is expected to occur on (a) 17 January 2019 (in relation to the First Placing) and (b) on or around 31 January 2019 (in relation to the Second Placing), (each and together a "Settlement Date"). Settlement will be on a delivery versus payment basis. However, in the event of any difficulties or delays in the admission of the Placing Shares to CREST or the use of CREST in relation to the Placings, the Company and finnCap may agree that the Placing Shares should be issued in certificated form. finnCap reserves the right to require settlement for the Placing Shares, and to deliver the Placing Shares to Placees, by such other means as it deems necessary if delivery or settlement to Placees is not practicable within the CREST system or would not be consistent with regulatory requirements in a Placee's jurisdiction.

Interest is chargeable daily on payments not received from Placees on the due date in accordance with the arrangements set out above, in respect of either CREST or certificated deliveries, at the rate of 2 percentage points above prevailing LIBOR as determined by finnCap.

If Placees do not comply with their obligations finnCap may sell any or all of their Placing Shares on their behalf and retain from the proceeds, for its own account and benefit, an amount equal to the Placing Price of each share sold plus any interest due. Placees will, however, remain liable for any shortfall below the Placing Price and for any stamp duty or stamp duty reserve tax (together with any interest or penalties) which may arise upon the sale of their Placing Shares on their behalf.

If Placing Shares are to be delivered to a custodian or settlement agent, Placees must ensure that, upon receipt, the conditional contract note or trade confirmation is copied and delivered immediately to the relevant person within that organisation. Insofar as Placing Shares are registered in a Placee's name or that of its nominee or in the name of any person for whom a Placee is contracting as agent or that of a nominee for such person, such Placing Shares should, subject as provided below, be so registered free from any liability to UK stamp duty or stamp duty reserve tax. Placees will not be entitled to receive any fee or commission in connection with the Placing.

Conditions of the Placing

The Placings is conditional upon the Placing Agreement becoming unconditional and not having been terminated in accordance with its terms.

The obligations of finnCap under the Placing Agreement in respect of the First Placing and Admission of the First Placing Shares are subject to the following conditions:

1. the Company having complied with all of its obligations and having satisfied all conditions to be satisfied by it under the Placing Agreement which fall to be performed or satisfied on or prior to Admission of the First Placing Shares;

2. none of the warranties contained within the Placing Agreement being untrue, inaccurate or misleading at the date of the Placing Agreement and none of the warranties having ceased to be true and accurate or having become misleading at any time following the date of the Placing Agreement up to and including the time of Admission of the First Placing Shares with reference to the facts and circumstances which shall then exist;

3. prior to Admission of the First Placing Shares, in the opinion of finnCap, (acting in good faith), there having been no Material Adverse Change (a "Material Adverse Change" being any adverse change in, or any development or event reasonably likely to result in an adverse change in, or affecting, the condition (financial, operational, legal or otherwise), earnings, business, management, financial position, properties, assets, rights, results of operations, net asset value, funding position, liquidity, solvency, prospects or general affairs of the Company or any company within its group which is material in the context of the group as a whole, whether or not arising in the ordinary course of business);

4. the material documents set out in Schedule 3 of the Placing Agreement having been delivered in accordance with the terms of the Placing Agreement;

5. the Closing Announcement having been released through the Regulatory News Service on the date of the Placing Agreement;

6. the obligations of finnCap not having been terminated pursuant to clause 14 of the Placing Agreement (as to which, see the "Termination of the Placing" section below) at any time prior to Admission of the First Placing Shares;

7. the Acquisition Agreement (the "Acquisition Agreement" being the the sale and purchase agreement to be entered into on or around the date of the Placing Agreement between AIM Smarter, Inc (a subsidiary of the Company) and Advertising Industry Mastermind Group, LLC in relation to the acquisition of the business and assets of Advertising Industry Mastermind Group, LLC) (i) not having lapsed or been terminated; and (ii) having become unconditional on First Admission in all respects and having been completed in accordance with its terms;

8. the First Placing Shares having been allotted subject only to First Admission;

9. the circular to the Company's shareholders incorporating a notice of general meeting having been posted by no later than 13 February 2019 or such later date as the Company may agree with finnCap;

10. Admission of the First Placing Shares occurring not later than 8:00am on the 17 January 2019 (being the "First Admission Date") or such later time and/or date, being no later than 8:00 am on 31 January 2019, as the Company may agree with finnCap; and

11. the delivery by the Company to finnCap of a warranty certificate in the form set out in schedule 5 of the Placing Agreement signed for and on behalf of the Company.

The obligations of finnCap under the Placing Agreement in respect of the Second Placing and Admission of the Second Placing Shares and the other transactions contemplated by this agreement are subject to the following conditions:

1. the Company having complied with all of its obligations and having satisfied all conditions to be satisfied by it under this agreement which fall to be performed or satisfied on or prior to Admission of the Second Placing Shares;

2. none of the warranties contained within the Placing Agreement being untrue, inaccurate or misleading at the date of the Placing Agreement and none of the warranties having ceased to be true and accurate or having become misleading at any time following the date of the Placing Agreement up to and including the time of Admission of the Second Placing Shares with reference to the facts and circumstances which shall then exist;

3. prior to Admission of the Second Placing Shares, in the opinion of finnCap, (acting in good faith), there having been no Material Adverse Change ;

4. the material documents set out in Schedule 3 of the Placing Agreement having been delivered in accordance with the terms of the Placing Agreement;

5. the resolutions to approve the allotment of the Second Placing Shares being duly passed without amendment and the General Meeting Announcement having been released through the Regulatory News Service;

6. the obligations of finnCap not having been terminated pursuant to clause 14 of the Placing Agreement (as to which, see the "Termination of the Placing" section below) at any time prior to Admission of the Second Placing Shares;

7. the Second Placing Shares having been allotted subject only to Second Admission;

9. Admission of the Second Placing Shares occurring not later than 8:00am on 31 January 2019 or such later time and/or date (being the "Second Admission Date"), being no later than 8:00am on 28 February 2019, as the Company may agree with finnCap; and

10. the delivery by the Company to finnCap of a warranty certificate in the form set out in schedule 5 of the Placing Agreement signed for and on behalf of the Company.

If, by the time specified in the Placing Agreement or (if no such time is specified) by 8:00am on the relevant Admission Date (or such later time and/or date as finnCap may agree, being no later than 8:00 am on 31 January 2019 in respect of the First Placing and no later than 8:00 am on 28 February 2019 in respect of the Second Placing), any of the conditions in the Placing Agreement have not been fulfilled or waived in writing, or the time for satisfaction of any condition extended, by finnCap in its absolute discretion and on such terms as it thinks fit, the Placing Agreement and all of the obligations of each of the parties under it shall, subject to the terms of the Placing Agreement (as to which, see the "Termination of the Placing" section below), immediately terminate and cease to have any effect.

Termination of the Placing

finnCap's obligations under the Placing Agreement may be terminated by finnCap at any time prior to Admission in certain circumstances including, among other things, if:

(1) any statement contained in any Placing Document is or has become untrue, inaccurate, incomplete in any material respect or misleading, or any matter has arisen which would, if the Placings was made at that time, constitute an omission from the Placing Documents, or any of them;

(2) in the sole judgement of finnCap (acting in good faith), there shall have occurred any Material Adverse Change since the date of Placing Agreement;

(3) in the sole judgement of finnCap (acting in good faith), there has been a material breach by the Company of any of its obligations under the Placing Agreement or any law or regulation in respect of the Placings, or there has been a breach of or there has taken place or arisen any event rendering untrue or incorrect in any respect any of the warranties set out in the Placing Agreement;

(4) in the sole judgement of finnCap (acting in good faith), if any warranty would, if repeated at Admission (by reference to the facts and circumstances then existing) be untrue, inaccurate or misleading in any respect;

(5) there has been a breach of any provision of the Acquisition Agreement by any party to it which would enable the Company to terminate the Acquisition Agreeement;

(6) a matter or circumstance has arisen which would be likely to give rise to an indemnity claim under the Placing Agreement;

(7) if subsequent to the execution of this agreement a circumstance or event has arisen which would, in the sole judgement of finnCap (acting in good faith), be likely to prejudice the success of the Placing, or which makes it, in the sole judgement of finnCap, impractical to proceed with the Placing and/or Admission and/or to market the Ordinary Shares on the terms and in the manner set out in the Placing Documents.

Representations, warranties and further terms

By submitting a bid in the Bookbuild, each prospective Placee (and any person acting on such Placee's behalf) represents, warrants, acknowledges and agrees (for itself and for any such prospective Placee) that:

1. it has read and understood this Announcement in its entirety and that its acquisition of the Placing Shares is subject to and based upon all the terms, conditions, representations, warranties, indemnities, acknowledgements, agreements and undertakings and other information contained in this Appendix and that it has not relied on, and will not rely on, any information given or any representations, warranties or statements made at any time by any person in connection with Admission, the Placings, the Company, the Placing Shares or otherwise, other than the information contained in this Announcement and the Publicly Available Information;

 2. it has not received a prospectus or other offering document in connection with the Placings and acknowledges that no prospectus or other offering document has been or will be prepared in connection with the Placings;

 3. the Company's ordinary shares are admitted to trading on AIM, and that the Company is therefore required to publish certain business and financial information in accordance with the rules and practices of AIM, which includes a description of the nature of the Company's business and the Company's most recent balance sheet and profit and loss account and that it is able to obtain or access such information without undue difficulty, and is able to obtain access to such information or comparable information concerning any other publicly traded company, without undue difficulty;

 4. neither finnCap nor the Company nor any of their respective affiliates, or their or their respective affiliates' agents, directors, officers or employees, respectively, nor any person acting on behalf of any of them has provided, and will not provide, it with any material regarding the Placing Shares or the Company or any other person other than the information in this Announcement or any other Publicly Available Information, such information being all that it deems necessary to make an investment decision in respect of the Placing Shares; nor has it requested finnCap, the Company, any of their respective affiliates, agents, directors, officers or employees or any person acting on behalf of any of them to provide it with any such information;

 5. neither finnCap nor any person acting on its behalf nor any of its affiliates, agents, directors, officers or employees, has or shall have any liability for this Announcement or any other Publicly Available Information, or any representation relating to the Company, provided that nothing in this paragraph excludes the liability of any person for fraudulent misrepresentation made by that person;

 6. the content of this Announcement and the Publicly Available Information has been prepared by and is exclusively the responsibility of the Company and that neither finnCap nor any persons acting on its behalf are responsible for or have or shall have any liability for any information or representation, warranty or statement relating to the Company contained in this Announcement or any other Publicly Available Information, nor will they be liable for any Placee's decision to participate in the Placings based on any information, representation, warranty or statement contained in this Announcement, any other Publicly Available Information or otherwise. Nothing in this Appendix shall exclude any liability of any person for fraudulent misrepresentation;

 7. it is not, and at the time the Placing Shares are acquired will not be, a resident of Australia, Canada, Japan, New Zealand or the Republic of South Africa and it acknowledges and agrees that the Placing Shares have not been and will not be registered or otherwise qualified under the securities legislation of Australia, Canada, Japan, New Zealand or the Republic of South Africa and may not be offered, sold or acquired, directly or indirectly, within those jurisdictions;

 8. the Placing Shares are being offered and sold only (i) outside the United States in "offshore transactions" as defined in, and in accordance with, Regulation S under the Securities Act; or (ii) to a limited number of persons that are QIBs pursuant to an exemption from, or in a transaction not subject to, the registration requirements under the Securities Act in a transaction not involving any public offering. It and any account for which it is acting is either: (i) located outside the United States and acquiring the Placing Shares in an "offshore transaction" as defined in, and in accordance with, Regulation S under the Securities Act or (ii) a QIB which has duly executed a US investor letter in a form provided to it and delivered the same to finnCap or its affiliates;

 9. it (i) has such knowledge and experience in financial and business matters to be capable of evaluating the merits and the risks of an investment in the Placing Shares, (ii) will not look to finnCap for all or part of any such loss it may suffer, (iii) is able to bear the economic risk of an investment in the Placing Shares, (iv) is able to sustain a complete loss of the investment in the Placing Shares and (v) has no need for liquidity with respect to its investment in the Placing Shares;

 10. the only information on which it is entitled to rely and on which it has relied in committing to subscribe for the Placing Shares is contained in this Announcement, the Publicly Available Information such information being all that it deems necessary to make an investment decision in respect of the Placing Shares and it has made its own assessment of the Company, the Placing Shares and the terms of the Placings based on Publicly Available Information, (ii) finnCap and the Company (or any of their respective affiliates) have not made any representation to it, express or implied, with respect to the Company, the Placings or the Placing Shares or the accuracy, completeness or adequacy of the Publicly Available Information, (iii) it has conducted its own investigation of the Company, the Placings and the Placing Shares, satisfied itself that the information is still current and relied on that investigation for the purposes of its decision to participate in the Placings and (iv) it has not relied on any investigation that finnCap or any person acting on its behalf may have conducted with respect to the Company, the Placings or the Shares;

 11. the Placing Shares have not been registered or otherwise qualified, and will not be registered or otherwise qualified, for offer and sale nor will a prospectus be cleared or approved in respect of any of the Placing Shares under the securities laws of the United States, or any state or other jurisdiction of the United States, nor approved or disapproved by the US Securities and Exchange Commission, any state securities commission or other regulatory authority in the United States, nor have any of the foregoing authorities passed upon or endorsed the merits of the Placing or the accuracy or adequacy of this Announcement. The Placing Shares have not been registered or otherwise qualified for offer and sale nor will a prospectus be cleared or approved in respect of the Placing Shares under the securities laws of Australia, Canada, Japan, New Zealand or the Republic of South Africa and, subject to certain exceptions, may not be offered, sold, taken up, renounced or delivered or transferred, directly or indirectly, within the United States, Australia, Canada, Japan, New Zealand or the Republic of South Africa, or in any country or jurisdiction where any action for that purpose is required;

 12. it and/or each person on whose behalf it is participating:

 a. is entitled to acquire Placing Shares pursuant to the Placings under the laws and regulations of all relevant jurisdictions;

 b. has fully observed such laws and regulations;

 c. has capacity and authority and is entitled to enter into and perform its obligations as an acquirer of Placing Shares and will honour such obligations; and

 d. has obtained all necessary consents and authorities (including, without limitation, in the case of a person acting on behalf of a Placee, all necessary consents and authorities to agree to the terms set out or referred to in this Appendix) to enable it to enter into the transactions contemplated hereby and to perform its obligations in relation thereto;

 13. it will not distribute, forward, transfer or otherwise transmit this Announcement or any part of it, or any other presentational or other materials concerning the Placings in or into the United States (including electronic copies thereof) to any person, and it has not distributed, forwarded, transferred or otherwise transmitted any such materials to any person;

 14. none of finnCap, its affiliates and any person acting on its behalf is making any recommendations to it, advising it regarding the suitability of any transactions it may enter into in connection with the Placing and that participation in the Placings is on the basis that it is not and will not be a client of finnCap and that finnCap has no duties or responsibilities to it for providing the protections afforded to finnCap's clients or customers or for providing advice in relation to the Placings nor in respect of any representations, warranties, undertakings or indemnities contained in the Placing Agreement nor for the exercise or performance of any of its rights and obligations thereunder including any rights to waive or vary any conditions or exercise any termination right;

 15. it will make payment to finnCap (as finnCap may direct) for the Placing Shares allocated to it in accordance with the terms and conditions of this Announcement on the due times and dates set out in this Announcement, failing which the relevant Placing Shares may be placed with others on such terms as finnCap may determine in its absolute discretion without liability to the Placee and it will remain liable for any shortfall below the net proceeds of such sale and the placing proceeds of such Placing Shares and may be required to bear any stamp duty or stamp duty reserve tax (together with any interest or penalties due pursuant to the terms set out or referred to in this Announcement) which may arise upon the sale of such Placee's Placing Shares on its behalf;

 16. its allocation (if any) of Placing Shares will represent a maximum number of Placing Shares which it will be entitled, and required, to acquire or subscribe for, and that it may be called upon to acquire or subscribe for a lower number of Placing Shares (if any), but in no event in aggregate more than the aforementioned maximum;

 17. no action has been or will be taken by any of the Company, finnCap or any person acting on behalf of the Company or finnCap that would, or is intended to, permit a public offer of the Placing Shares in the United States or in any country or jurisdiction where any such action for that purpose is required;

 18. the person who it specifies for registration as holder of the Placing Shares will be (i) the Placee or (ii) a nominee of the Placee, as the case may be. finnCap and the Company will not be responsible for any liability to stamp duty or stamp duty reserve tax resulting from a failure to observe this requirement. It agrees to acquire Placing Shares pursuant to the Placing on the basis that the Placing Shares will be allotted to a CREST stock account of finnCap who will hold them as nominee directly or indirectly on behalf of the Placee until settlement in accordance with its standing settlement instructions with it;

 19. the allocation, allotment, issue and delivery to it, or the person specified by it for registration as holder, of Placing Shares will not give rise to a stamp duty or stamp duty reserve tax liability under (or at a rate determined under) any of sections 67, 70, 93 or 96 of the Finance Act 1986 (depository receipts and clearance services) and that it is not participating in the Placing as nominee or agent for any person or persons to whom the allocation, allotment, issue or delivery of Placing Shares would give rise to such a liability;

 20. it and any person acting on its behalf falls within Article 19 (5) and/or 49(2) of the Order, as amended, and undertakes that it will acquire, hold, manage and (if applicable) dispose of any Placing Shares that are allocated to it for the purposes of its business only;

 21. it has not offered or sold and will not offer or sell any Placing Shares to persons in the United Kingdom prior to Admission except to persons whose ordinary activities involve them in acquiring, holding, managing or disposing of investments (as principal or agent) for the purposes of their business or otherwise in circumstances which have not resulted and which will not result in an offer to the public in the United Kingdom within the meaning of section 85 (1) of FSMA;

22. if within the EEA, it is a Qualified Investor as defined in section 86(7) of FSMA, being a person falling within Article 2.1(e) of the Prospectus Directive;

 23. it has only communicated or caused to be communicated and it will only communicate or cause to be communicated any invitation or inducement to engage in investment activity (within the meaning of section 21 of FSMA) relating to Placing Shares in circumstances in which section 21(1) of FSMA does not require approval of the communication by an authorised person;

 24. it has complied and it will comply with all applicable laws with respect to anything done by it or on its behalf in relation to the Placing Shares (including all relevant provisions of FSMA and the Financial Services Act 2012 in respect of anything done in, from or otherwise involving the United Kingdom);

 25. if it is a financial intermediary, as that term is used in Article 3(2) of the Prospectus Directive (including any relevant implementing measure in any member state), the Placing Shares acquired by it in the Placings will not be acquired on a non-discretionary basis on behalf of, nor will they be acquired with a view to their offer or resale to, persons in a member state of the EEA which has implemented the Prospectus Directive other than qualified investors, or in circumstances in which the express prior written consent of finnCap has been given to the offer or resale;

 26. it has not offered or sold and will not offer or sell any Placing Shares to persons in the EEA prior to Admission except to persons whose ordinary activities involve them in acquiring, holding, managing or disposing of investments (as principal or agent) for the purpose of their business or otherwise in circumstances which have not resulted and which will not result in an offer to the public in any member state of the EEA;

 27. if it has received any confidential price sensitive information about the Company in advance of the Placing, it has not: (a) dealt in the securities of the Company; (b) encouraged or required another person to deal in the securities of the Company; or (c) disclosed such information to any person, prior to the information being made publicly available;

 28. neither finnCap, the Company nor any of their respective affiliates, or their or their respective affiliates' agents, directors, officers or employees, respectively, nor any person acting on behalf of such persons is making any recommendation to it, advising it regarding the suitability of any transaction it may enter into in connection with the Placings nor providing advice in relation to the Placings nor in respect of any representation, warranty, acknowledgement, agreement, undertaking or indemnity contained in the Placing Agreement nor the exercise or performance of any of finnCap's rights and obligations thereunder including any rights to waive or vary any conditions or exercise any termination right;

 29. acknowledges and accepts that finnCap may, in accordance with applicable legal and regulatory provisions, engage in transactions in relation to the Placing Shares and/or related instruments for their own account for the purpose of hedging their underwriting exposure or otherwise and, except as required by applicable law or regulation, finnCap will not make any public disclosure in relation to such transactions;

 30. it has complied with its obligations under the Criminal Justice Act 1993, the EU Market Abuse Regulation (2015/596/EU) ("MAR") and in connection with money laundering and terrorist financing under the Proceeds of Crime Act 2002, the Criminal Justice Act 1993, the Terrorism Act 2000, the Terrorism Act 2006 and the Money Laundering Regulations 2007 and any related or similar rules, regulations or guidelines issued, administered or enforced by any government agency having jurisdiction in respect thereof (together the "Regulations") and, if making payment on behalf of a third party, that satisfactory evidence has been obtained and recorded by it to verify the identity of the third party as required by the Regulations;

 31. except as set out in clause 32 below, represents and warrants that it has neither received nor relied on any 'inside information' (for the purposes of MAR and section 56 of the Criminal Justice Act 1993) concerning the Company prior to or in connection with accepting the invitation to participate in the Placing and is not purchasing Placing Shares on the basis of material non-public information;

 32. if it has received any 'inside information' (for the purposes of MAR and section 56 of the Criminal Justice Act 1993) in relation to the Company and its securities, it confirms that it has received such information within the market soundings regime provided for in article 11 of MAR and associated delegated regulations and it has not: (i) dealt (or attempted to deal) in the securities of the Company; (ii) encouraged, recommended or induced another person to deal in the securities of the Company; or (iii) unlawfully disclosed inside information to any person, prior to the information being made publicly available;

 33. its commitment to acquire Placing Shares on the terms set out in this Announcement will continue notwithstanding any amendment that may in future be made to the terms and conditions of the Placings and that Placees will have no right to be consulted or require that their consent be obtained with respect to the Company's or finnCap's conduct of the Placings;

 34. it has knowledge and experience in financial, business and international investment matters as is required to evaluate the merits and risks of acquiring the Placing Shares. It further acknowledges that it is experienced in investing in securities of this nature and is aware that it may be required to bear, and is able to bear, the economic risk of, and is able to sustain, a complete loss in connection with the Placings. It has relied upon its own examination and due diligence of the Company and its affiliates taken as a whole, and the terms of the Placings, including the merits and risks involved;

 35. the Company, finnCap and others will rely upon the truth and accuracy of the foregoing representations, warranties, acknowledgements and agreements, which are given to finnCap on its own behalf and on behalf of the Company and are irrevocable;

 36. if it is acquiring the Placing Shares as a fiduciary or agent for one or more investor accounts, it has full power and authority to make, and does make, the foregoing representations, warranties, acknowledgements, agreements and undertakings on behalf of each such account(s);

 37. time is of the essence as regards its obligations under this Appendix;

 38. any document that is to be sent to it in connection with the Placings will be sent at its risk and may be sent to it at any address provided by it to finnCap;

 39. the Placing Shares will be issued subject to the terms and conditions set out in this Appendix; and

 40. this Appendix and all documents into which this Appendix is incorporated by reference or otherwise validly forms a part will be governed by and construed in accordance with English law. All agreements to acquire shares pursuant to the Bookbuild and/or the Placings will be governed by English law and the English courts shall have exclusive jurisdiction in relation thereto except that proceedings may be taken by the Company or finnCap in any jurisdiction in which the relevant Placee is incorporated or in which any of its securities have a quotation on a recognised stock exchange.

By participating in the Placing, each Placee (and any person acting on such Placee's behalf) agrees to indemnify and hold the Company, finnCap and each of their respective affiliates and each of their and their respective affiliates' agents, directors, officers and employees, respectively, harmless from any and all costs, claims, liabilities and expenses (including legal fees and expenses) arising out of or in connection with any breach of the representations, warranties, acknowledgements, agreements and undertakings given by the Placee in this Appendix and further agrees that the provisions of this Appendix shall survive after completion of the Placing.

The agreement to allot and issue Placing Shares to Placees (or the persons for whom Placees are contracting as agent) free of stamp duty and stamp duty reserve tax in the UK relates only to their allotment and issue to Placees, or such persons as they nominate as their agents, directly by the Company. Such agreement assumes that the Placing Shares are not being acquired in connection with arrangements to issue depositary receipts or to transfer the Placing Shares into a clearance service. If there were any such arrangements, or the settlement related to other dealings in the Placing Shares, stamp duty or stamp duty reserve tax may be payable, for which neither the Company nor finnCap would be responsible. If this is the case, it would be sensible for Placees to take their own advice and they should notify finnCap accordingly. In addition, Placees should note that they will be liable for any capital duty, stamp duty and all other stamp, issue, securities, transfer, registration, documentary or other duties or taxes (including any interest, fines or penalties relating thereto) payable outside the UK by them or any other person on the acquisition by them of any Placing Shares or the agreement by them to acquire any Placing Shares and each Placee, or the Placee's nominee, in respect of whom (or in respect of the person for whom it is participating in the Placing as an agent or nominee) the allocation, allotment, issue or delivery of Placing Shares has given rise to such non-UK stamp, registration, documentary, transfer or similar taxes or duties undertakes to pay such taxes and duties, including any interest and penalties (if applicable), forthwith and to indemnify on an after-tax basis and to hold harmless the Company and finnCap in the event that either the Company and/or finnCap have incurred any such liability to such taxes or duties.

The representations, warranties, acknowledgements and undertakings contained in this Appendix are given to finnCap for itself and on behalf of the Company and are irrevocable.

finnCap is authorised and regulated by the FCA in the United Kingdom and is acting exclusively for the Company and no one else in connection with the Bookbuild, the Placing and Admission and will not regard any other person (whether or not a recipient of this document) as a client in relation to the Bookbuild or the Placing and will not be responsible to anyone (including Placees) other than the Company for providing the protections afforded to its clients or for providing advice in relation to the Bookbuild or the Placing or other matters referred to in this Announcement.

Each Placee and any person acting on behalf of the Placee acknowledges that finnCap does not owe any fiduciary or other duties to any Placee in respect of any representations, warranties, undertakings, acknowledgements or agreements or indemnities in the Placing Agreement.

Each Placee and any person acting on behalf of the Placee acknowledges and agrees that finnCap may (at its absolute discretion) satisfy its obligations to procure Placees by itself agreeing to become a Placee in respect of some or all of the Placing Shares or by nominating any connected or associated person to do so.

When a Placee or any person acting on behalf of the Placee is dealing with finnCap, any money held in an account with finnCap on behalf of the Placee and/or any person acting on behalf of the Placee will not be treated as client money within the meaning of the relevant rules and regulations of the FCA which therefore will not require finnCap to segregate such money, as that money will be held by it under a banking relationship and not as trustee.

The price of shares and any income expected from them may go down as well as up and investors may not get back the full amount invested upon disposal of the shares. Past performance is no guide to future performance and persons needing advice should consult an independent financial adviser.

All times and dates in this Announcement may be subject to amendment. finnCap will notify Placees and any persons acting on behalf of the Placees of any changes.

No statement in this Announcement is intended to be a profit forecast or estimate, and no statement in this Announcement should be interpreted to mean that earnings per share of the Company for the current or future financial years would necessarily match or exceed the historical earnings per share of the Company.

Neither the content of the Company's website nor any website accessible by hyperlinks on the Company's website is incorporated in, or forms part of, this Announcement.

This Announcement may contain and the Company may make verbal statements containing "forward-looking statements" with respect to certain of the Company's plans and its current goals and expectations relating to its future financial condition, performance, strategic initiatives, objectives and results. Forward-looking statements sometimes use words such as "aim", "anticipate", "target", "expect", "estimate", "intend", "plan", "goal", "believe", "seek", "may", "could", "outlook" or other words of similar meaning. By their nature, all forward-looking statements involve risk and uncertainty because they relate to future events and circumstances which are beyond the control of the Company, including amongst other things, United Kingdom domestic and global economic business conditions, market-related risks such as fluctuations in interest rates and exchange rates, the policies and actions of governmental and regulatory authorities, the effect of competition, inflation, deflation, the timing effect and other uncertainties of future acquisitions or combinations within relevant industries, the effect of tax and other legislation and other regulations in the jurisdictions in which the Company and its affiliates operate, the effect of volatility in the equity, capital and credit markets on the Company's profitability and ability to access capital and credit, a decline in the Company's credit ratings; the effect of operational risks; and the loss of key personnel. As a result, the actual future financial condition, performance and results of the Company may differ materially from the plans, goals and expectations set forth in any forward-looking statements. Any forward-looking statements made in this Announcement by or on behalf of the Company speak only as of the date they are made. Except as required by applicable law or regulation, the Company expressly disclaims any obligation or undertaking to publish any updates or revisions to any forward-looking statements contained in this Announcement to reflect any changes in the Company's expectations with regard thereto or any changes in events, conditions or circumstances on which any such statement is based.

Information for distributors

Solely for the purposes of the product governance requirements contained within: (a) EU Directive 2014/65/EU on markets in financial instruments, as amended ("MiFID II"); (b) Articles 9 and 10 of Commission Delegated Directive (EU) 2017/593 supplementing MiFID II; and (c) local implementing measures (together, the "MiFID II Product Governance Requirements"), and disclaiming all and any liability, whether arising in tort, contract or otherwise, which any "manufacturer" (for the purposes of the MiFID II Product Governance Requirements) may otherwise have with respect thereto, the Placing Shares have been subject to a product approval process, which has determined that the Placing Shares are: (i) compatible with an end target market of (a) retail investors, (b) investors who meet the criteria of professional clients and (c) eligible counterparties, each as defined in MiFID II; and (ii) eligible for distribution through all distribution channels as are permitted by MiFID II (the "Target Market Assessment"). Notwithstanding the Target Market Assessment, distributors should note that: the price of the Placing Shares may decline and investors could lose all or part of their investment; the Placing Shares offer no guaranteed income and no capital protection; and an investment in the Placing Shares is compatible only with investors who do not need a guaranteed income or capital protection, who (either alone or in conjunction with an appropriate financial or other adviser) are capable of evaluating the merits and risks of such an investment and who have sufficient resources to be able to bear any losses that may result therefrom. The Target Market Assessment is without prejudice to the requirements of any contractual, legal or regulatory selling restrictions in relation to the Placings. Furthermore, it is noted that, notwithstanding the Target Market Assessment, finnCap will only procure investors who meet the criteria of professional clients and eligible counterparties.

For the avoidance of doubt, the Target Market Assessment does not constitute: (a) an assessment of suitability or appropriateness for the purposes of MiFID II; or (b) a recommendation to any investor or group of investors to invest in, or purchase, or take any other action whatsoever with respect to the Placing Shares.

Each distributor is responsible for undertaking its own target market assessment in respect of the Placing Shares and determining appropriate distribution channels.