GlobalData Regulatory News (DATA)

Progressive Digital Media Group Plc

Notice of Annual General Meeting and Annual Financial Report

and

Proposed Capital Reduction and Consolidation and Sub-Division of Ordinary Shares

Progressive Digital Media Group Plc ("Progressive" or the "Company"), a content driven media company producing premium business information, announces that the Annual General Meeting of the Company will be held at John Carpenter House, John Carpenter Street, London, EC4Y 0AN at 12.00 p.m. on 24 April 2013. The report and accounts for the year ended 31 December 2012 will today be posted to Shareholders together with the Notice of Annual General Meeting.

In addition, the Company is today posting to Shareholders a circular (the "Circular") containing details of a proposed reorganisation of the Company's share capital (the "Reorganisation"), together with formal notice of the requisite general meeting (the "General Meeting"), to be held on 24 April 2013 at 12.30 p.m. (or, if later, immediately following the conclusion of the Annual General Meeting). The Notice of AGM, Annual Financial Report, Circular and Notice of General Meeting to consider the Reorganisation will shortly be available for inspection at www.progressivedigitalmedia.com.

Highlights:

·; In order to support the Company's ability to pay future dividends (should circumstances in the future make it desirable to do so), the Company is proposing to increase its distributable reserves by approximately £71,393,250 by the cancellation of the Company's share premium account. If approved by the Shareholders, the cancellation will require subsequent confirmation by the Court.

·; As at 22 March 2013 (being the latest practicable date prior to the publication of the Circular), the Company had 532,047,686 Ordinary Shares in issue, having a mid-market price per Ordinary Share at the close of business on such date of £0.32. The Board is of the view that it would benefit the Company and Shareholders to reduce the number of Ordinary Shares in issue with a resulting adjustment in the market price of such shares, by consolidating the Existing Ordinary Shares on the basis of 1 Consolidated Ordinary Share of 10 pence each for every 1,000 Existing Ordinary Shares of 0.01 pence each, and immediately following the Consolidation, subdividing each Consolidated Ordinary Share into 140 New Ordinary Shares.

·; The purpose of the Consolidation and Sub-Division is to create a capital base which is more consistent with the Company's peers and which is designed to encourage greater liquidity in the Company's shares.

·; The proportion of the issued ordinary share capital of the Company held by each Shareholder immediately before and after the Consolidation and Sub-Division will, save for fractional entitlements, remain unchanged.

·; Apart from the change in nominal value, the New Ordinary Shares arising on implementation of the Consolidation and Sub-Division will have the same rights as the Existing Ordinary Shares, including voting, dividend and other rights.

The Directors consider the Reorganisation to be in the best interests of the Company and its Shareholders as a whole and accordingly unanimously recommend Shareholders to vote in favour of the Resolutions to be proposed at the General Meeting as they intend to do so in respect of their beneficial holdings amounting, in aggregate, to 366,047,464 Ordinary Shares, representing approximately 68.8 per cent. of the existing issued ordinary share capital of the Company.

Resolution 1, which will be proposed as a special resolution, is to approve the Capital Reduction.

Resolution 2, which will be proposed as an ordinary resolution, is to approve the Consolidation and the Sub-Division.

Expected timetable of principal events in relation to the Reorganisation

Terms defined in this announcement have the meanings given to them in the Circular.

Enquiries:

Progressive Digital Media Group plc 0207 936 6400

Mike Danson, Chairman

Simon Pyper, Group Managing Director

N+1 Singer 0207 496 3000

James Maxwell

Nick Donovan

Hudson Sandler 0207 796 4133

Nick Lyon

1. Introduction and summary

Your Board announces today that it proposes to undertake a reorganisation of the Company's share capital, comprising:

(a) the Capital Reduction;

(b) the Consolidation; and

(c) immediately following the Consolidation, the Sub-Division.

The Reorganisation is conditional upon, amongst other things, shareholder approval at the General Meeting.

The purpose of this announcement is to provide you with information about the background to and the reasons for the Reorganisation, to explain why the Board considers the Reorganisation to be in the best interests of the Company and its Shareholders as a whole and why the Board unanimously recommend that you vote in favour of the Resolutions to be proposed at the General Meeting, notice of which is being posted to Shareholders today.

2. Background to and reasons for the Capital Reduction

In order to support the Company's ability to pay future dividends (should circumstances in the future make it desirable to do so), the Company is proposing to increase its distributable reserves by approximately £71,393,250 by the cancellation of the Company's share premium account. In addition to facilitate any future dividend payments, the Capital Reduction will normalise the Company's capital base, having regard to the fact that the trading operations of the Group are largely carried on by subsidiary companies who are themselves appropriately capitalised.

As at 31 December 2012, the Company had a profit and loss account deficit of £22,970,858.87 and the balance standing to the credit of the Company's share premium account was £71,393,250.69. The Company is therefore seeking the approval of the Shareholders to cancel its share premium account, which will increase the Company's distributable reserves by approximately £71,393,250, subject to the discharge of any undertakings required by the Court as explained below. If approved by the Shareholders, the cancellation will require subsequent approval by the Court.

In seeking this approval, the Company will be required to give such undertakings or other form of creditor protection as the Court may require for the benefit of the Company's creditors at the date on which the cancellation of the share premium account becomes effective. These may include seeking the consent of the creditors to the cancellation or the provision by the Company to the Court of an undertaking to deposit a sum of money into a blocked account created for the purpose of discharging creditors of the Company. The consent of the Company's main creditors, being the landlord of the Company's leasehold properties and the Company's bankers, has been obtained. It is anticipated that the initial directions hearing in relation to the cancellation will take place on 8 May 2013, with the final hearing taking place on 22 May 2013 and the cancellation becoming effective on 23 May 2013, following the necessary registration of the Court order at Companies House.

3. Background to and reasons for the Consolidation and Sub-Division

As at 22 March 2013 (being the latest practicable date prior to the publication of the Circular), the Company had 532,047,686 Ordinary Shares in issue, having a mid-market price per Ordinary Share at the close of business on such date of £0.32. The Board is of the view that it would benefit the Company and Shareholders to reduce the number of Ordinary Shares in issue with a resulting adjustment in the market price of such shares, by consolidating the Existing Ordinary Shares on the basis of 1 Consolidated Ordinary Share of 10 pence each for every 1,000 Existing Ordinary Shares of 0.01 pence each, immediately followed by a sub-division of the Consolidated Ordinary Shares on the basis of 140 New Ordinary Shares for each Consolidated Ordinary Share.

The Consolidation

As at 22 March 2013 (being the latest practicable date prior to the publication of the Circular) the Company had 16,788 Shareholders, of which 16,128 Shareholders represented in aggregate approximately 96 per cent of the total number of Shareholders but only approximately 0.5 per cent. of the total issued share capital of the Company. Each of these 16,128 Shareholders held fewer than 1,000 Ordinary Shares having a maximum value of approximately £320 (based upon the closing mid market share price of an Ordinary Share on 22 March 2013), and the average holding of these Shareholders was approximately 166 Ordinary Shares with an average value of approximately £53.

As explained further below, Shareholders holding fewer than 1,000 Existing Ordinary Shares at the Record Date will receive cash in lieu of their fractional entitlements and will cease to be shareholders of the Company. The Board is conscious that the ancillary dealing costs which would be incurred by Shareholders in individually realising investments of this size through market sales, coupled with the current limited liquidity of the Ordinary Shares, would be prohibitive in many circumstances. Accordingly, the Consolidation provides a realisation event for such Shareholders which benefits from significantly reduced dealing costs given the centralised administration of the sale of Fractional Entitlement Shares by the Company's brokers.

Furthermore, the current size of the Shareholder register places an unwarranted financial and administrative burden on the Company. Although the Company has taken advantage of the provisions of the Act which enable it to communicate with its Shareholders by electronic means (including by way of website), the Act requires Shareholders to be notified in writing when any notice or other documents, such as the Company's annual report, is posted on the website. Your Board believes that the cost of administering the Company's Shareholder register and communicating with such a large number of Shareholders (many of whom have a small interest in the Company) is to the detriment of the Company and its current Shareholders taken as a whole.

The Sub-Division

Immediately following the Consolidation, it is proposed that each Consolidated Ordinary Share will be subdivided into 140 New Ordinary Shares. The purpose of the Sub-Division is to create a capital base which is more consistent with the Company's peers and which is designed to encourage greater liquidity in the Company's shares.

In addition, the existence of a disproportionately high number of Ordinary Shares relative to the earnings of the Company results in a mathematically small "earnings per share" (EPS) figure. EPS figures are routinely used by professional investors as a tool to measure corporate performance, and increasing EPS by normalising the Company's capital base in line with the Company's peers through the Consolidation and Sub-Division may encourage greater investor appetite for, and accordingly liquidity in, the New Ordinary Shares.

4. The Consolidation and Sub-Division

The Consolidation

Upon implementation of the Consolidation, Shareholders on the register of members of the Company on the Record Date of the Consolidation and Sub-Division (which is 6.00 p.m. on 24 April 2013), will exchange every 1,000 Existing Ordinary Shares that they hold for 1 Consolidated Ordinary Share. For example, if a Shareholder holds 12,000 Existing Ordinary Shares each with a nominal value of 0.01 pence each at the Record Date, such Shareholder will, following the implementation of the Consolidation, hold 12 Consolidated Ordinary Shares each with a nominal value of 10 pence each.

As all existing ordinary shareholdings in the Company are proposed to be consolidated, the proportion of the issued ordinary share capital of the Company held by each Shareholder immediately before and after the Consolidation will, save for fractional entitlements, remain unchanged.

No Shareholder will be entitled to a fraction of a Consolidated Ordinary Share and where, as a result of the Consolidation, any Shareholder would otherwise be entitled to a fraction only of a Consolidated Ordinary Share in respect of their holding of Existing Ordinary Shares on the Record Date (a "Fractional Shareholder"), such fractions will be aggregated with the fractions of Consolidated Ordinary Shares to which other Fractional Shareholders of the Company may be entitled so as to form full Consolidated Ordinary Shares ("Fractional Entitlement Shares") and, following the Sub- Division, sold in the market on behalf of the relevant Fractional Shareholders, as explained below. This means that any such Fractional Shareholders will not have a resultant proportionate shareholding of Consolidated Ordinary Shares exactly equal to their proportionate holding of Existing Ordinary Shares, and as noted above, Shareholders with only a fractional entitlement to a Consolidated Ordinary Share (i.e. those Shareholders holding fewer than 1,000 Existing Ordinary Shares at the Record Date) will cease to be a shareholder of the Company and will receive cash in lieu of their fractional entitlements. Accordingly, Shareholders currently holding fewer than 1,000 Ordinary Shares who wish to remain a shareholder of the Company following the Consolidation would need to increase their shareholding to at least 1,000 Ordinary Shares prior to the Record Date. Shareholders in this position are encouraged to obtain independent financial advice before taking any action.

The Sub-Division

Immediately following the Consolidation, each Consolidated Ordinary Share will be subdivided into • New Ordinary Shares.

The New Ordinary Shares arising from the Fractional Entitlement Shares following the Sub-Division will be sold in the market on behalf of the relevant Fractional Shareholders. In the event that the net proceeds of sale are three pounds (£3.00) or more per any entitled Fractional Shareholder, then such proceeds of sale will be paid to the relevant Fractional Shareholder. However, if such net proceeds of sale amount to less than three pounds (£3.00) per any entitled Fractional Shareholder, the costs, including the associated professional fees and expenses, that would be incurred in distributing such proceeds are likely to exceed the total net proceeds distributable to such Fractional Shareholders. The Board is therefore of the view that, as a result of the disproportionate costs in such circumstances, it would not be in the Company's best interests to distribute such proceeds of sale and the proceeds will instead be retained for the benefit of the Company in accordance with the Company's articles of association and Resolution 2.

Resulting share capital

The issued share capital of the Company on Admission immediately following the Consolidation and Sub-Division (assuming no further issues of Ordinary Shares between the date of this announcement and the date of Admission) is expected to comprise 74,486,676 New Ordinary Shares of 1/14 pence each.

For illustrative purposes only, examples of the effects of the Consolidation and Sub-Division in respect of certain holdings of Existing Ordinary Shares are set out below. These examples do not show cash proceeds of the sale of Fractional Entitlement Shares, the value of which will depend on the market value of New Ordinary Shares at the time of sale, as detailed above.

Rights attaching to the New Ordinary Shares

Apart from the change in nominal value, the New Ordinary Shares arising on implementation of the Consolidation and Sub-Division will have the same rights as the Existing Ordinary Shares, including voting, dividend and other rights.

Effect on options etc.

The entitlement to Existing Ordinary Shares of holders of securities or instruments convertible into Ordinary Shares (such as options) shall be adjusted in accordance with the terms of such securities or instruments upon implementation of the Consolidation and Sub-Division.

5. Settlement

As outlined above, in the event that the net proceeds of sale of New Ordinary Shares arising from Fractional Entitlement Shares to which Fractional Shareholders may be entitled, are three pounds (£3.00) or more per any entitled Fractional Shareholder, then such proceeds of sale shall be paid to the relevant Fractional Shareholder. In respect of Fractional Shareholders holding their Existing Ordinary Shares in certificated form, any monies will be paid by cheque to the relevant Fractional Shareholders entitled thereto (at such Fractional Shareholder's risk) and such cheques are expected to be dispatched by no later than 8 May 2013. In the case of Shareholders who hold Existing Ordinary Shares in uncertificated form, any cash entitlements will be dispatched by means of CREST by procuring the creation of an assured payment obligation in favour of the Shareholder's payment bank, in accordance with the CREST assured payment arrangements. All cash payments will be made in pounds sterling and, for certificated Shareholders, by cheque drawn on a branch of a UK clearing branch and dispatched by first class post. However, as detailed above, if such net proceeds of sale amount to less than three pounds (£3.00) per any entitled Fractional Shareholder, such net proceeds will, as a result of the disproportionate costs of distributing such net proceeds to relevant Fractional Shareholders, instead be retained for the benefit of the Company in accordance with the Company's articles of association and Resolution 2.

The Consolidation and Sub-Division is conditional upon the New Ordinary Shares being admitted to trading on AIM. Application for such Admission will be made so as to enable the New Ordinary Shares to be admitted to trading on AIM as soon as practicable following the Record Date. It is expected that Admission will occur at 8.00 a.m. on 25 April 2013, whereupon the Consolidation and Sub-Division will become effective.

If you hold a share certificate in respect of your Existing Ordinary Shares in the Company, your certificate will no longer be valid from the Record Date. If you hold 1,000 or more Existing Ordinary Shares on the Record Date you will be sent a new share certificate evidencing the New Ordinary Shares to which you are entitled under the Consolidation and Sub- Division. Such share certificates are expected to be dispatched no later than 10 May 2013 by first class post at the risk of the relevant Shareholder, to the registered address of that Shareholder or, in the case of joint Shareholders, to the one whose name appears first on the register of members. Upon receipt of the new share certificate, you should destroy any old share certificates. Pending the dispatch of the new share certificates, transfers of certificated New Ordinary Shares will be certified against the Company's share register. Shareholders holding fewer than 1,000 Existing Ordinary Shares on the Record Date should likewise destroy their share certificates.

If you hold your Existing Ordinary Shares in uncertificated form, you should expect to have your CREST account credited with the New Ordinary Shares to which you are entitled upon implementation of the Consolidation and Sub-Division as soon as practicable after the Record Date.

Following the Consolidation and Sub-Division, the Company's new SEDOL code with be B87ZTG2 and its new ISIN code will be GB00B87ZTG26.

6. Taxation

Introduction

The following statements are intended only as a general guide to the current tax position under UK taxation law and practice. Taxation law (including, without limitation, taxation levels, bases and reliefs) or its interpretation or application may change after the date of this announcement. These statements relate only to the UK taxation treatment of the Consolidation and Sub-Division and certain limited aspects of the UK tax position of Shareholders who are the beneficial owners of Existing Ordinary Shares and who are resident or (in the case of individuals) ordinarily resident in the UK for tax purposes and who hold their shares in the Company beneficially as an investment (and not as securities to be realised in the course of a trade). Certain holders of Existing Ordinary Shares, such as dealers in securities, insurance companies, collective investment schemes and persons who have acquired their shares by reason of their or another's employment may be taxed differently and are not considered. The following is not, and is not intended to be, an exhaustive summary of the tax consequences of acquiring, holding and disposing of Existing Ordinary Shares or New Ordinary Shares. A Shareholder who is in any doubt as to his or her tax position or is subject to tax in any jurisdiction other than the UK should consult his or her duly authorised professional adviser without delay.

CGT treatment of the Capital Reduction

The Shareholders should not be treated as making any disposal of their Existing Ordinary Shares as a result of the Capital Reduction and should not therefore be subject to any capital gains tax charge at this stage of the Reorganisation.

CGT treatment of the Consolidation and Sub-Division

The proposed Consolidation and Sub-Division should constitute a reorganisation of the Company's share capital for UK capital gains tax purposes. Therefore, to the extent that a Shareholder receives Consolidated Ordinary Shares in exchange for his Existing Ordinary Shares under the proposed Consolidation, he should not generally be treated as making a disposal of any of his Existing Ordinary Shares. Similarly, to the extent that he receives New Ordinary Shares in exchange for his Consolidated Ordinary Shares under the proposed Sub-Division, he should not generally be treated as making a disposal of any of his Consolidated Ordinary Shares. Ultimately the New Ordinary Shares should (for UK capital gains tax purposes) be treated as the same asset as, and as having been acquired at the same time and for the same aggregate cost as, the holding of Existing Ordinary Shares from which they derive.

CGT treatment of fractional entitlements

Any entitlements to fractions of Consolidated Ordinary Shares arising as a result of the Consolidation will be consolidated and sold in the market on behalf of the Fractional Shareholders entitled to the same.

If a Shareholder holds fewer than 1,000 Existing Ordinary Shares at the time the Consolidation takes effect, he will only be entitled to receive cash under the Consolidation. As a result, he will be treated as having disposed of such Existing Ordinary Shares for UK capital gains tax purposes and he may, depending on his individual circumstances, realise a chargeable gain or an allowable loss for tax purposes.

If and to the extent that a Shareholder receives cash and New Ordinary Shares under the proposed Consolidation and Sub-Division as a result of the sale of fractional entitlements, he should not in practice be treated as having made a part disposal of his holding of Existing Ordinary Shares. Instead, he should be able to treat the cash received as a deduction from any base cost he may have in his Existing Ordinary Shares (and, accordingly, the New Ordinary Shares held after the proposed Consolidation and Sub-Division) rather than as consideration for a disposal of the Existing Ordinary Shares held representing such fractional entitlement. HMRC will generally apply this practice provided that either the cash receipt is less than £3,000 or it does not constitute more than 5 per cent. of the value of the Existing Ordinary Shares. However, this treatment is based only on current HMRC practice and may vary depending on a Shareholder's personal circumstances.

Shareholders with cash proceeds of less than three pounds (£3.00) will not receive any payment from the Company for their fractional entitlement. Such Shareholders should be treated as having disposed of their fractional entitlement for nil consideration and accordingly do not need to deduct any amount from the base cost on their Existing Ordinary Shares.

On a subsequent disposal of the whole or part of the holding of New Ordinary Shares, holders may, depending on their circumstances, be subject to tax on the amount of any chargeable gain realised.

Stamp taxes

No liability to stamp duty or stamp duty reserve tax will be incurred by a holder of Existing Ordinary Shares as a result of the proposed Consolidation and Sub-Division.

7. The General Meeting

Set out at the end of the Circular is a notice convening the General Meeting to be held on 24 April 2013 at the offices of the Company at John Carpenter House, John Carpenter Street, London EC4Y 0AN at 12.30 p.m. (or, if later, immediately following the conclusion of the annual general meeting of the Company), at which the Resolutions will be proposed for the purposes of implementing the Reorganisation.

Resolution 1, which will be proposed as a special resolution, is to approve the Capital Reduction.

Resolution 2, which will be proposed as an ordinary resolution, is to approve the Consolidation and the Sub-Division.

8. Action to be taken

A Form of Proxy for use at the General Meeting accompanies the Circular. The Form of Proxy should be completed and signed in accordance with the instructions thereon and returned to the Company's registrars, Capita Registrars, PXS, The Registry, 34 Beckenham Road, Beckenham, Kent BR3 4TU as soon as possible, but in any event so as to be received by no later than 12.30 p.m. on 22 April 2013. The completion and return of a Form of Proxy will not preclude Shareholders from attending the General Meeting and voting in person should they so wish.

9. Recommendation

The Directors consider the Reorganisation to be in the best interests of the Company and its Shareholders as a whole and accordingly unanimously recommend Shareholders to vote in favour of the Resolutions to be proposed at the General Meeting as they intend to do so in respect of their beneficial holdings amounting, in aggregate, to 366,047,464 Ordinary Shares, representing approximately 68.8 per cent. of the existing issued ordinary share capital of the Company.