Cloudtag Inc Regulatory News (CTAG)

29 September 2015

CloudTag Inc.

('CloudTag' or 'the Company')

Operations Update, Warrant Agreement, Issue of Equity and Subscription of Loan Notes

Operations Update

CloudTag (CTAG:LN), the company that brings personal monitoring to the health, wellbeing and fitness markets, is pleased to announce that its long term strategic shareholder and software developer Preciousbluedot Ltd has successfully integrated Adience's proprietary, cutting edge user profiling technology into the MyCloudTag App. This integration will allow CloudTag to create rich and accurate profiles of its users through deep machine learning algorithms based on more than 1,000 different data points in the App.

Warrant Agreement

CloudTag has agreed to settle historic fees due to Preciousbluedot Ltd. through the issuance of warrants over 11,433,334 ordinary shares at a strike price of 3.0 pence per share. The warrants vest immediately and are exercisable at any time until the tenth anniversary of the date of grant, being 28 September 2025.

Issue of Equity

The Company has issued, in aggregate, 799,629 new ordinary shares in settlement of fees due to a director and an employee ("Fee Shares"), comprising:

· 560,000 new ordinary shares at an average price of 2.5 pence per share in settlement of director's fees due to Amit Ben-Haim, CEO of the Company, under the terms of his employment contract. Following this issue of equity, Amit Ben-Haim is interested in 8,215,165 shares in the Company, representing 4.01 per cent. of the Company's so enlarged issued share capital; and

· 239,629 new ordinary shares at an average price of 2.51 pence per share in settlement of fees due to an employee of the Company under the terms of his employment contract.

Application will be made for the admission of the Fee Shares to trading on AIM and it is expected that dealings in these shares will commence on or around 5 October 2015.

Following the issue of the Fee Shares, the total number of ordinary shares in issue is 205,002,214. This number may be used by shareholders as the denominator for the calculation by which they will determine if they are required to notify their interest in, or a change in their interest in, the share capital of the Company.

Subscription of Loan Notes

CloudTag has entered into a subscription agreement with a new investor in respect of the issue of £150,000 unsecured convertible loan notes due in September 2016 ("Loan Notes"). These Loan Notes may be converted at any time and are convertible into ordinary shares in the Company at 2.5 pence per share if converted by the holder, or at 2.5 pence per 1.5 shares if converted early at the Company's option. The Loan Notes carry nil interest until 28 March 2016 and thereafter carry interest at 8% per annum.

Funds raised from the issue of the Loan Notes will be used for general working capital purposes. The Company is in discussions with a number of third parties with regard to additional funding which may be required to fund the Company through to planned launch of its wearable technology in early 2016 which is in line with the circular published by the Company on 4 December 2014.

Enquiries