Cloudtag Inc Regulatory News (CTAG)

31 March 2014

CloudTag Inc.

("CloudTag" or the "Company")

Placing and Notice of Annual General Meeting

CloudTag, the developer of wearable technology devices, announces that it has conditionally raised £450,000 (before expenses) through the placing of 5,625,000 new Ordinary Shares of 0.1pence each at a placing price of 8 pence per Ordinary Share (the "Placing Shares") with certain existing investors (the "Placing"). Each Placing Share has a warrant attached to it which entitles the subscriber to subscribe for one new Ordinary Share at 8 pence per share, such warrant to vest immediately on completion of the Placing and to expire on the third anniversary of vesting (the "Warrants").

The Placing and the issue of the Warrants, is conditional, among other things, on the Company obtaining approval from Shareholders to their allotment and associated disapplication of pre-emption rights at the Company's Annual General Meeting to be held at 11:00 am on 23 April 2014 at the offices of Fladgate LLP, 16 Great Queen Street, London WC2B 5DG (the "AGM").

The net proceeds of the Placing will be used by the Group to further accelerate the development of the Company's business and for general working capital purposes. A full review of the Company's activities to date and strategy going forward, including various product launch dates, is outlined in the Chairman's statement in the Company's 2013 Annual Report and Accounts (the "Accounts"), which were published earlier today.

 The Accounts contain a notice convening the AGM to approve certain matters relating to the Placing and normal AGM business, and will be posted to shareholders shortly. The Accounts will also be made available to view on the Company's website (www.cloudtag.com) this afternoon.

Andy Jackson, CEO, commented:

"'CloudTag has several exciting new product launches planned in both quarter two and quarter three of this year and the Placing allows us to further develop and enhance our current offering. Our 'app' launch in quarter two will now be supported by enhanced marketing and sales activity as well as additional cutting edge 'premium content' through our sports and fitness partners".

Details of the Placing

The Placing will raise £450,000 before expenses through the issue of 5,625,000 new Ordinary Shares at a placing price of 8 pence per share (the "Placing Price"). The Placing Price represents a premium of 14.3 per cent to the Company's closing middle market price of 7 pence per Ordinary Share on 28 March 2014, being the last trading day prior to this announcement. Completion of the Placing and the issue of the Placing Shares are subject to, inter alia, the passing of the resolutions related to the Placing (the "Resolutions") at the AGM.

Each Placing Share has a warrant attached to it which entitles the subscriber to subscribe for one new Ordinary Share at 8 pence per share, such warrant to vest immediately on completion of the Placing and to expire on the third anniversary of vesting.

The Placing Shares will, on admission to trading on AIM ("Admission"), be credited as fully paid and will have the same rights in all respects with the existing Ordinary Shares, including the right to receive all dividends and other distributions declared. The Placing is conditional, among other things, upon:

(i) the approval of the Resolutions at the AGM; and

(ii) Admission.

Application will be made to the London Stock Exchange for the Placing Shares to be admitted to trading on AIM and it is expected that Admission will be effective and trading will commence at 8:00 am on 24 April 2014.

Related Party Transaction

Platform Securities Nominees Limited ("Platform") currently has a 22.7 per cent. interest in the existing share capital of the Company and accordingly is classified as a substantial shareholder pursuant to the AIM Rules for Companies. Platform is the entity through which Killik & Co. ("Killik") holds its interest, on behalf of certain of its advised clients, in CloudTag.

Killik has committed, on behalf of certain of its advised clients, to subscribe for new Ordinary Shares as part of the Placing and accordingly the issue of Placing Shares to Killik constitutes a related party transaction in accordance with the AIM Rules for Companies.

The Directors consider having consulted the Company's nominated adviser, Strand Hanson Limited, that the terms on which the Placing Shares will be issued to Killik (on behalf of certain of its advised clients) are fair and reasonable as far as its shareholders are concerned.