Blue Star Regulatory News (BLU)

Blue Star Capital plc

("Blue Star Capital" or "the Company")

Shareholder Loan Update

Blue Star Capital is pleased to announce that further to the announcement dated 3 January 2013, the Company has agreed a further extension to the shareholder loan agreement (the "Loan") entered into on 28 April 2011, and thereafter extended on 1 June 2012, 12 October 2012 and 3 January 2013. The original amount of the Loan was £400,000 which, with the accrued interest at 10% per annum, had been due for repayment by 30 September 2012.

Save as set out below, the terms of the Loan remain unchanged, except that repayment, which had been extended to 31 January 2013, has now been deferred until 31 March 2013 (the "Final Redemption Date").

Pursuant to the terms of the Loan extension, with effect from 1 February 2013 and until 28 February 2013, the full amount (including interest and repayment premium) to redeem the Loan is £564,916 (the "Revised Principal"). From 1st March 2013, the Revised Principal will accrue interest on a compound basis at a rate of 2.0% per month, or part month.

As consideration for agreeing to extend the repayment date of the loan as set out above, the Company has further agreed that the warrants issued to the providers of the Loan at the time of the original loan agreement (the "Warrants") will be amended such that the exercise price of the warrants will be reduced from 2 pence per ordinary share to 0.6 per ordinary share.

Anthony Fabrizi and a company connected with Noel Lyons (both individuals being non-executive directors of the Company) are amongst those that are providing the Loan and are each a related party for the purposes of AIM Rule 13. The independent directors of the Company, being The Rt Hon The Lord Dear Kt QPM DL LLB, Peter Varnish OBE and General Sir Michael Wilkes KCB CBE consider, having consulted with the Company's nominated adviser Daniel Stewart & Company plc ("Daniel Stewart"), that the terms of the Loan and Warrants are fair and reasonable insofar as the Company's shareholders are concerned.

Corporate strategy update

The Directors of the Company are continuing to review various strategic options available to the Company and are in discussions with a number of parties regarding opportunities to improve the Company's immediate cash position and provide it with (i) sufficient funds in order to repay the Shareholder Loan; and (ii) general working capital for the Company. However, the outcome of these discussions is dependent on a number of factors, including the actions of a number of third parties, and are therefore outside of the control of the Company or its Directors and there can be no guarantee as to their success.

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