Gaming Realms Regulatory News (GMR)

15 July 2013

Pursuit Dynamics PLC

("PDX" or the "Company')

Proposed Reverse Takeover

Pursuant to the Company's announcement on 2 July 2013 in relation to the conditional agreement to sell Pursuit Marine Drive Limited and a potential reverse takeover, Pursuit Dynamics (AIM: PDX) is pleased to announce the conditional acquisition of three online social gaming and gambling businesses: Gaming Realms Limited, BeJig Limited and AlchemyBet Limited for a total consideration of approximately £12.1 million and placing to raise approximately £3.4 million, amongst other proposals as set out below (the "Proposals").

An Admission Document containing details of the Proposals and containing notice of General Meeting will be posted to Shareholders today and is available to view on the Company's website at www.pdx.biz.

The suspension relating to the existing shares of Pursuit Dynamics will be lifted today and therefore trading in the Company's shares will recommence at 7:30 a.m.

Highlights

·; Conditional Disposal of Pursuit Marine Drive Limited to eliminate Company's existing liabilities

·; The acquisitions of Gaming Realms Limited, AlchemyBet Limited and BeJig Limited to establish the Company within the growing online social gaming and gambling market

·; Proposed new management of the Company with extensive experience and successful record in the online gaming and gambling market

·; 1 for 10 Share Consolidation

·; Placing of 26,230,846 New Ordinary Shares at a price of 13 pence (on a post consolidation basis) to raise approximately £3.4 million

·; Change of name of the Company to Gaming Realms plc and adoption of New Articles of Association to reflect the new business of the Company

·; Waiver of obligations under Rule 9 of the City Code

·; General Meeting of the Company on 31 July 2013 to approve the Proposals

Action to be taken

Enclosed with the Admission Document being sent to Shareholders today is a form of proxy for use by Shareholders in connection with the General Meeting. Whether or not you intend to be present at the General Meeting, Shareholders are asked to complete, sign and return the form of proxy to the Company's Registrar as soon as possible but in any event so as to arrive no later than 10.00 a.m. on 29 July 2013. The completion and return of a form of proxy will not preclude Shareholders from attending at the General Meeting and voting in person should they wish to do so. Accordingly, whether or not Shareholders intend to be present at the General Meeting, they are urged to complete and return the form of proxy as soon as possible.

Expected timetable of principal events

Definitions

The same definitions apply throughout this announcement as are applied in the Admission Document. The Admission Document will be sent to Shareholders today and is available on the Company's website: www.pdx.biz

For further information, please contact:

Introduction

As announced on 26 February 2013, the Company has been pursuing a programme to realise value from the Existing Group's intellectual property portfolio and reduce its liabilities. In addition, the Company has been investigating opportunities that could generate returns to Shareholders in the future.

As a result of the Company's programme to realise value from its assets, the Company has successfully:

(1) disposed of the "food, beverage and brewing business" of its subsidiary Pursuit Marine Drive by way of a business and asset sale of the same to Olympus Automation Limited, which completed on 30 April 2013. In connection with such disposal, Pursuit Marine Drive also granted a licence of reactor patents and trade marks to Olympus Automation Limited;

(2) entered into certain arrangements with Tyco Fire & Security GmbH for the sale/licence of certain intellectual property rights comprising (1) a licence from the Company of two of the reactor patents tobe used by Tyco (a) exclusively in the field of fire suppression and control and (b) non-exclusively for decontamination; (2) the sale of all the atomiser intellectual property from the Company; and (3) certain additional patents; and

(3) withdrawn from the LINK Collaboration with the consent of the other parties to such Collaboration and the Biotechnology and Biological Sciences Research Council and granted the Department of Food Science, University of Nottingham a licence of certain intellectual property and a loan of equipment in connection with the withdrawal of the Company from the LINK Collaboration.

The Company has also, conditional on the approval of Shareholders, agreed to dispose of its remaining material asset, being its interest in Pursuit Marine Drive. Further information on the Disposal is set out below. Furthermore, the remaining subsidiaries of the Existing Group are now in the process of being wound up or liquidated.

Alongside the sale of the Existing Group's intellectual property, the Company believes, subject to the Disposal being approved by Shareholders at the General Meeting, that it has eliminated all material liabilities associated with Pursuit Dynamics. In addition, provisions have been made in the accounts of the Company for any non-material liabilities.

Concurrently with its disposal programme, the Directors set out criteria for potential acquisitions. Over the previous months the Directors have evaluated a number of potential acquisition candidates that presented business plans to the Company. Following this evaluation, the Directors identified three businesses which are complementary to each other and have progressed these to the stage where conditional agreements have been signed in relation to each of the businesses. The Acquisitions constitute a reverse takeover for the purposes of the AIM Rules and are conditional upon Shareholder approval, which is being sought at the General Meeting to be held at the offices of Memery Crystal LLP, 44 Southampton Buildings, London WC2A 1AP at 10.00 a.m. on 31 July 2013.

The Acquisitions are conditional upon, inter alia, the passing of the Resolutions and Admission. It is expected that Admission will become effective and dealings in the Enlarged Issued Share Capital will commence on AIM on 1 August 2013.

In addition, the Company proposes to undertake a Share Consolidation whereby every holding of 10 Existing Ordinary Shares will be consolidated into one New Ordinary Share. It is also proposed that the New Articles are adopted in line with current best practice and in accordance with the Act, and to set out the rights of the B Shares in connection with the New Share Option Scheme.

Immediately following Completion, certain Shareholders of the Enlarged Group who are deemed to be acting in concert will hold, in aggregate, 83,664,401 New Ordinary Shares and will have options over 26,153,843 B Shares giving the Concert Party an interest in excess of 30 per cent. of the Enlarged Issued Share Capital. Under Rule 9 of the Takeover Code this interest would normally result in the Concert Party being obliged to make an offer to all Shareholders (other than the Concert Party) to acquire their shares. Following an application by the Concert Party, the Takeover Panel has agreed to waive this obligation subject to the approval of the Independent Shareholders at the General Meeting.

The nature of the Company's business will be transformed by the Acquisitions and, in order to reflect its new activities, it is proposed that the Company changes its name to Gaming Realms plc.

Immediately prior to but conditional on Admission, the Directors will resign from the Board and the Proposed Directors will be appointed to the Board immediately on Admission.

Shareholders are therefore invited to approve all of the Proposals, which are conditional upon the passing of the resolution in relation to the Disposal, which is a standalone resolution. If the resolution in relation to the Disposal is not approved by the Shareholders, none of the Proposals will be implemented.

Background to the Disposal

The Company entered into the Disposal Agreement with Cellulac for the sale of the entire issued share capital of its wholly-owned subsidiary, Pursuit Marine Drive, for an initial non-refundable deposit of £50,000 and an additional cash sum of £950,000, which may become payable on 31 December 2013 or earlier, subject to certain milestones being met by Cellulac. As the achievement of these milestones is uncertain and they are all outside the control of the Company, the Directors cannot assess the likelihood of these milestones being achieved. Completion of the Disposal Agreement is conditional upon i) the passing of Resolution 1; and ii) receipt by the Company of a deed of release of a charge granted by Pursuit Marine Drive in favour of Barclays Bank plc.

By virtue of its size, completion of the Disposal will result in a fundamental change of business for the Company. Following completion of the Disposal, the asset base of the Company will comprise cash, which is expected to be a minimum of £3.2 million as at the date of the General Meeting and limited IT and office equipment.

As such, the Disposal requires the prior approval of Shareholders, in accordance with the AIM Rules, to be sought at the General Meeting as Resolution 1. Should the Disposal not be approved, all other Proposals will not proceed.

Background to the Acquisitions and Executive Management Team

Gaming Realms Limited was founded by Michael Buckley, Patrick Southon, Simon Collins and Noel Rowse in 2012. The company was formed to develop a new bingo concept based on interactive next generation digital gambling games and its first development Bingo Godz is due to be soft launched in August 2013.

BeJig and AlchemyBet were founded independently and had subsequent financial and management support through the investments made by NewGame (then controlled by Patrick Southon, Simon Collins and NewShore Capital LLP). BeJig operates 'Freemium' social gaming applications, primarily through its Avatingo and 5 Star Slots games. AlchemyBet develops and operates real-money online slots through its PocketFruity brand which currently has 17 proprietary games.

The Proposed Directors believe the BeJig and AlchemyBet businesses will fit well with the Bingo Godz product and the Enlarged Group will have the potential to create a significantly larger platform through, inter alia, cross promotion, improved client retention and lower CPA (cost of acquiring Active Players via paid-for online and offline marketing).

The Founders were also the founders and executive team behind Cashcade, a leading UK-based online gambling company specialising in marketing bingo and casino games. Cashcade was sold to Bwin.party in 2009, for an aggregate consideration of approximately £96 million.

Cashcade was one of the first companies to market and promote online bingo to a mass audience. A focused marketing effort was instrumental in developing Foxy Bingo, the primary Cashcade brand. Cashcade was innovative in managing the user relationship to further drive growth and in providing an immersive and enjoyable user experience heightened by a "community feel". This propagated viral marketing thus reducing the CPA and adding to the highly scalable nature of the digital based business model.

Cashcade's leadership in online gaming and successful brand development was reflected in multiple industry awards.

In the financial year ended 31 December 2008 prior to its sale, Cashcade and its subsidiaries generated an EBITDA of approximately £12.2 million. Cashcade's management team continued to develop it and its subsidiaries following the sale, and the business generated an EBITDA of approximately £16.9 million in the year ended 31 December 2011.

Strategy of the Enlarged Group and Market Opportunity

The Enlarged Group's initial strategy will be to establish itself within the casino and bingo segment of the social gaming market as well as launch real money gambling games within the UK regulated market.

Gaming Realms will operate in the growing online gaming market which was worth approximately US$35 billion in 2012. Social gaming, where the Company's activities will also be focused, is worth approximately US$1.7 billion and is expected to grow to US$4 billion by 2015.

Much of this market growth is expected to come from the increased adoption of smartphones by consumers, which currently account for 17 per cent. of mobile usage, facilitated by increased mobile internet capabilities. Games account for over 64 per cent. of smartphone app usage; and half of Facebook users go to the site to play games. Gaming Realms intends to grow its business by offering its products to a substantial and growing customer base.

Growth in mobile internet is one of the most powerful trends in the internet landscape and the global smartphone and tablet installed base is expected to exceed the PC installed base during 2013.1 There were an estimated 1 billion smartphone users at the end of 2012 representing 17 per cent. of total mobile users. Despite the large growth in smartphones, the Proposed Directors concur with analysts who believe that user adoption has significant upside.

Games dominate mobile app usage accounting for in excess of 50 per cent. of app usage, significantly higher than social networking which accounted for 22 per cent. of consumer time. Social networks, led by Facebook have created a substantial platform, with Facebook claiming in excess of 1 billion users. About 50 per cent. of Facebook sessions start with the user playing a game. Zynga, the global leader in social gaming, has approximately 70 per cent. penetration on Facebook and approximately 33 per cent. of all social gaming players. Whilst Facebook is the largest social network, research suggests that the potential revenue from non-Facebook social networks is greater than that of Facebook.

The longer term strategy is to increase the combined databases of the company's subsidiaries, and enhance revenues, by focusing on product and marketing initiatives which:

● cover the substantial and overlapping fast growing audience

● converge 'paid participation' business models

● include shared distribution on web, tablet and mobile platforms

● share common success factors such as customer acquisition, retention, design and monetisation.

Intentions of the Concert Party

Certain of the Proposed Directors are members of the Concert Party, details of which are set out in Part V of the Admission Document. The Concert Party has confirmed that it has no intentions to alter any of the existing employment rights of the employees and management of the Targets as such rights will be fully safeguarded and that there will be no material change in the conditions of employment of any person. The Enlarged

Group will move its registered offices to c/o Memery Crystal, 44 Southampton Buildings, London WC2A 1AP but will retain its operational offices in their existing locations and does not intend to redeploy any of the fixed assets of the Targets. The Concert Party supports the strategy set out above.

Furthermore, the Proposed Directors intend to hire further employees in line with their strategy to grow and continue to develop and operate new games. The potential hiring will not alter any of the existing employment rights of the employees of the Targets. There are no pension arrangements existing or envisaged and no scheme deficits in the Targets, nor in the Company.

Following completion of the Disposal, there will be no material legacy assets of the Company and the two remaining employees, both of whom have been served notice will leave the Company shortly after Admission.

There is no current intention that Gaming Realms will renew these contracts.

The Existing Directors have taken into account the strategy of the Proposed Directors (including certain members of the Concert Party) and the intentions of the Concert Party set out above and believe such strategy and such intentions to be in the best interests of Shareholders and the Company.

Background of the Acquisitions and the gaming offerings

Gaming Realms Limited

Gaming Realms Limited was founded in 2012 by the Founders with the purpose of developing Bingo Godz, due to launch in August 2013. Bingo Godz is a new bingo concept which uses elements commonly found in social games

Since incorporation, Gaming Realms Limited has been developing Bingo Godz in conjunction with Bede Gaming, a software company based in Newcastle founded by the owners of Crown Bingo, a leading UK bingo site. The site will be operated by IPS which has a Category 1 and 2 Alderney eGambling Licence issued by the Alderney Gambling Control Commission. IPS will also be responsible for payment processing. Gaming Realms Limited will be responsible for marketing and continued development of the product in conjunction with Bede Gaming.

i) Bingo Godz

The Bingo Godz product is built with HTML 5 which allows cross device support with a single set of sourcecode and offers users a simple yet immersive bingo game experience which can be played on the web, tablet and mobile platforms. On downloading the app or visiting the website, users will able to play bingo, together with casino themed slots, for real money on their smart phones, tablets or desktops. The player will be able to participate in bingo free of charge, so as to encourage length and frequency of play. All players are encouraged to deposit funds and become real money players through incentives offered. Game play is focused around successful mobile and tablet games that encourage the user to return to the game to progress through various levels. Initially, players will have access to only one virtual world in which to play but will be able to access additional rooms and levels through frequent and successful play. The bingo and casino themed slots playable in each virtual room will allow the player to wager, win and withdraw real money via a single wallet payment platform, provided by IPS.

The software for Bingo Godz has been fully tested for functionality and has been trialled on Facebook and

Real Money Platforms for robustness and scalability. A soft launch of Bingo Godz is planned for August

2013 when users will be able to play via their smartphone and online devices with the hard launch planned in September 2013.

The game play is designed around a selection of Godz that provide players with bonus features (e.g. free marks of a bingo ticket, cash-back on tickets for a game if a player doesn't win), and each Godz offers a different power and bonus. The Proposed Directors believe that combining these social features may result in higher user times, better conversion and increased life time player value compared with existing online bingo operators. This is borne out by research provided by Optimove7, who provide analytics on online behavioural patterns.

Analytics are crucial to track user engagement and Gaming Realms Limited is currently in discussion with

Bede Gaming and business intelligence company Optimove, who help to enhance CRM and ensure prompt

feedback on user engagement. Such research undertaken by Optimove has discovered that:

- An active social player typically plays every two days, as opposed to an active gambling player who

typically plays once every four days > 2x greater engagement

- 60 per cent. of single-payment OTD social players will continue to play after their one-time payment,

compared with 7 per cent. of OTD players in traditional online gambling space > 9x greater engagement

- 50 per cent. of players engaged in social gaming are still active after six months, as opposed to only 8 per cent. in gambling > 6x greater engagement

Gaming Realms Limited will generate its revenue through a commission on gaming sales generated by players registering their credit cards, via IPS, and becoming an active RMP. Once registered as a RMP on Bingo Godz, the player can deposit money into his or her virtual wallet and wager either bingo games or casino themed slots.

Gaming Realms Limited is focussing its marketing efforts on branding for Bingo Godz and its launch will be driven by a TV marketing approach based on the approach used by Cashcade to market Foxy Bingo, which proved to be highly successful in growing users for a mass market gambling product. In addition, Gaming

Realms Limited has agreed a solus test spend on ITV channels and digital agency Adotomi, to build liquidity and provide more behavioural feedback. There will be additional focus on SEO, SEM and Facebook initiatives.

Further growth opportunities are anticipated through the development of new distribution channels such as interactive TV as well as marketing the game initially as a 'non gambling' format and take advantage of real money gaming when it is legalised.

ii) CastleJackpot

CastleJackpot is a web based casino product provided by Bede and operated by IPS which launched in June 2013. It uses the same technology platform as Bingo Godz with a standalone registration process, and has shown an encouraging initial start since launch.

BeJig Limited

BeJig was formed in 2011 by an award winning team of engineers and game designers with proven experience in the online gambling space. BeJig's development team have had extensive exposure to large gambling applications and game development for a number of major industry players.

BeJig is a developer and operator of online multiplayer social gambling games and soft launched its first product, the social, virtual currency gambling game "Avatingo", in 'beta' on Facebook in August 2011. BeJig has three new Facebook apps currently running in pre-launch Beta phase which are described below.

i) Avatingo

Avatingo is a Facebook app set in a virtual town containing games, bingo and slot machines. Users create their own unique avatar character, which allows them to navigate around the world to different locations where they can participate in varied virtual gambling games and interact with other users.

Revenue is generated from this virtual platform through selling upgrades, premium access and virtual goods to players. The game is designed to encourage players to make purchases of virtual currency in order to improve their Avatar's game experience.

Following management's review of initial activity, key decisions were taken to redesign the game format, integrate a sophisticated data mining toolset and move to an iterative development process with updates and changes being released fortnightly.

The Avatingo desktop app was re-launched in early March 2012 and since then KPIs have improved steadily, particularly with the recent launch in April 2013 of the game on iPad - on which player numbers have doubled during May 2013. Further growth on mobile is expected with the launch of the game on the Android platform in early June 2013.

ii) Five Star Slots

This is a virtual currency online casino using content supplied by Leander Games. Players access a range of slot machines which they unlock through repeat play. Leander games recently won eGaming review's "Social Gaming Supplier of the Year" award for their involvement with 5 Star slots.

BeJig are refining this game in consultation with Kontagent, the analytics partner on one of the largest and most profitable social slot machine apps to date ("Slottomania" by Playtika).

The beta version launched in March, this product has been monitored and iterated and has grown steadily in player numbers and revenue. Management anticipate aggressively taking this game to market now that it shows scalable KPIs.

iii) Sh*tHead

Sh*tHead is a multiplayer card game based on a popular offline format and is currently running in early Beta on Facebook (from March 2013) with exploratory marketing scheduled to begin imminently. Development on a tablet version of this title is underway. Management hope that the multiplayer nature of this game and its first-to-market status on the Facebook platform will help it achieve viral growth beyond any BeJig titles to date, resulting in expansion at a low CPA.

iv) Skill Bingo

Skill Bingo is a project name for a new application targeting a wide variety of hardware. The theme of this game is to create a short yet engaging experience. The management team believe there is an opportunity to address audiences for traditional bingo dabbing with a multi-platform, high production/casual skill bingo game.

AlchemyBet Limited

AlchemyBet was founded in January 2011, with its primary activity and assets being similar to the business previously undertaken and held by Cometa, a premium-rate technology based mobile gaming business. Cometa was dissolved on 19 July 2011 and AlchemyBet was 'reformed' in January 2012, following a £700k investment from NewGame.

Since then, AlchemyBet has continued to be a developer and operator of mobile slot and casino themed 'real-money' gambling games, including fruit machines, obtaining a UK Gambling Commission Licence in May 2012 and launching its first brand, Pocket Fruity, in May 2012.

i) Pocket Fruity

PocketFruity™ develops and operates "fruit machine" games and currently has seventeen proprietary games. PocketFruity's new games are written in HTML5, allowing cross device support with a single set of source code. These 17 proprietary games have been, and continue to be designed and developed, to maintain interest with the existing depositing players and reengage old depositing players, while also trying to grow the new player base.

Revenue is gambling based and generated directly from the mobile slot machines. AlchemyBet currently generates CPA's of between £80 to £100, a life time value of between £250 and £300 and has a database of in excess of 5,000 depositing players.

AlchemyBet's strategy is to grow its user base in the UK via effective target marketing of the Pocket Fruity™ brand following its planned re-launch on the back of improvements to the gaming platform, along with establishing a number of Business to Business game licensing and/or distribution agreements.

Selected Financial Information

The financial information set out below has been extracted without material adjustment from the historical financial information of the Gaming Realms Group for the three years ended 31 March 2013.

Competition

The Proposed Directors believe that, following the Acquisitions, the main competition for Bingo Godz will initially be confined to the incumbent online bingo sites such as Tombola, Gala, Jackpot Joy, Meccabingo and Foxy Bingo. However, these competitors are predominantly online based offerings as opposed to the HTML 5 platform designed for mobile and tablet platform which Bingo Godz intends to exploit.

The Proposed Directors believe the competition to BeJig's brands, Avatingo and Five Star Slots, are primarily from companies such as Caesars Interactive Entertainment Inc., Product Madness, IGT/Double Down and Plumbee. Whilst for AlchemyBet's PocketFruity brand, games operated by mFortune and Probability as a pure play mobile casino offering with William Hill, Ladbrokes, PaddyPower and Skybet providing competition using their broader sports biased products.

Current Trading and prospects for the enlarged Group and use of proceeds

The Gaming Realms Group has continued to strengthen its position over recent months. There has been further development of Bingo Godz, which has now been approved in the Apple App Store and is planned to be launched in the second half of 2013. Additionally, Gaming Realms also launched castlejackpot.com which has shown encouraging early results. Bejig is now realising the development of 3 out of its 4 products - Avatingo, Five Star Slots and sh*thead (which is in beta mode). Five Star Slots has been further developed since 1 April 2013 and is ready for a hard launch to the market. Tests in June showed positive ARPU and growth through an increased marketing spend. Avatingo has now been rolled out onto Apple and Android platforms as it aims to reach a new audience. AlchemyBet has outperformed expectations, seeing an increase in active players and monthly revenue, and further development is planned to improve the platform. The Proposed Directors believe that the Enlarged Group may be well positioned for future growth and remain confident of the Company's future prospects.

The net Placing proceeds and the cash in the Company after payment of the expenses will be used from Admission by the Enlarged Group to develop and grow its products. The Proposed Directors believe that significant targeted marketing spend will be key to the launch and further growth of the Enlarged Group's products. The Proposed Directors intend to deploy the majority of the placing proceeds through TV advertising and SEO, SEM and Facebook initiatives and drive an increase in the number of active users, lower CPAs and increase LTVs. The Proposed Directors also intend to hire further employees in line with the Enlarged Group's strategy to grow and continue to develop and operate new games.

Directors on Admission

On Admission the Board shall comprise four executive directors and two independent non-executive directors. The biographical details of the Proposed Directors are set out below:

Michael Buckley, Executive Chairman, aged 66

Michael Buckley was Executive Chairman of Cashcade, which he founded with Patrick Southon and Simon Collins in 2000. Cashcade became a leading UK based online gaming company prior to its sale to PartyGaming plc in 2009. Amongst a number of functions he performed for the company during this period,

Michael was responsible for raising the £7 million equity needed for the company's development, created a number of important commercial relationships for Cashcade, and led the sale process which generated an aggregate sale consideration of approximately £96 million for shareholders.

Michael has invested in and been Executive Chairman of a number of public companies. These include SelecTv plc, a producer of comedy and comedy drama series for television such as Lovejoy, Birds of a Feather and The New Statesman. SelecTv invested in a consortium which in 1991 won the franchise to create Meridian Television of which Michael was a founder director. He was also Executive Chairman of Pacific Media plc, which invested in a number of internet backbone companies in Asia during the 1990s as well as creating a chain of movie theatres in South East Asia in partnership with United Artists Theatre

Circuit Inc.

Michael has held other public and private company directorships, having obtained a professional qualification as a Chartered Accountant in the UK.

Patrick Southon, Chief Executive Officer, aged 41

Patrick has been working within the online gambling sectors for the last 13 years. He is particularly focused on marketing, brand building and media buying. Patrick was Managing Director of Cashcade and Managing Partner of NewGame an investment fund focusing on innovation within the gambling sector. His marketing expertise allowed Cashcade to build a distinctive and prominent brand identity around, among others, its flagship 'Foxy Bingo' brand and turned the company into one of the most effective advertisers on British television. Based on research by TNS, Marketing Magazine cited Foxy Bingo as having the best-value television advertising between 2008 and 2010.

Mark Segal, Finance Director, aged 35

Mark recently left Bwin.party as Finance Director for the bingo vertical. Previous to that Mark was Finance

Director of Cashcade until it was acquired by PartyGaming plc in July 2009. Mark was responsible for the full finance function, including commercial negotiations, business intelligence and operational support in the business, and was involved in the sale to PartyGaming plc and acquisition of Independent Technology Ventures in July 2007. Prior to joining Cashcade, in May 2005, Mark spent 5 years at the accountancy firm Martin Greene Ravden, where he qualified as a chartered accountant in 2003.

Simon Collins, Executive Director, aged 41

Simon was the co-founder and commercial director of Cashcade. He formed a range of profitable business-to-business and affiliate relationships for Cashcade and was an early adopter of both search engine and social network marketing in the monetised digital gaming space. In 2008 and 2009, Cashcade featured in The Sunday Times Top 20 fastest growing technology companies and the business won numerous other industry awards. Following the sale of Cashcade Simon remained at Bwin.party until April 2011, where he focused on innovation, research and development as well as the ongoing development of Cashcade's brand in the social networking space. Since leaving Bwin.party, Simon joined Patrick Southon in setting up NewGame an investment fund focusing on innovation within the gambling sector.

Jim Ryan, Non-executive Director, aged 51

Jim Ryan recently retired as the Co-CEO of Bwin.party. He has spent the last 12 years of his career in leadership roles within the online gaming sector. Jim has led a number of the industry's largest merger and acquisition transactions which include the merger of PartyGaming plc and Bwin.party, the acquisitions of Cashcade (Foxy Bingo) and the World Poker Tour and the sale of St Minver Limited. Jim has held senior management posts at SXC Health Solutions Corp., Procuron Inc., Metcan Information Technologies Inc and

Epson Canada Limited.

Educated at Brock University (Goodman School of Business) in Ontario, Canada, where he obtained a business degree with first class honours, Jim obtained professional qualifications as a Chartered Accountant and Certified Public Accountant from the Canadian Institute of Chartered Accountants.

Mark Wilson, Non-executive Director, aged 52

Mark Wilson is currently strategic adviser to Sky International for the Americas and is an investor in media, gaming and real estate. Mark has held senior level leadership positions at Television Games Network, Music Choice International, Hubbard Enterprises, New Mexico Gaming, LLC and Churchill Downs, Inc. Mark received his undergraduate degree from Western Kentucky University with honours and a Juris Doctorate from the University of Louisville.

Principal Terms of the Disposal

The Company entered into the Disposal Agreement with Cellulac for the sale of the entire issued share capital of its wholly owned subsidiary, Pursuit Marine Drive on 1 July 2013. Completion of the Disposal Agreement is conditional upon i) the passing of Resolution 1; and ii) receipt by the Company of a deed of release of a charge granted by Pursuit Marine Drive in favour of Barclays Bank plc. The conditions are required to be satisfied on or before 31 October 2013, or such later date as the parties agree. In the event that the conditions are not satisfied by such date, and the parties are unable to agree to extend the date for satisfaction of the conditions, then the Disposal Agreement shall automatically terminate.

An initial non-refundable deposit of £50,000 was paid by Cellulac to the Company. The deposit is non-refundable. The balance of the purchase price being £950,000 is to be paid by Cellulac to the Company on the earlier of 31 December 2013, and the date falling three business days after a sale or quotation, of Cellulac or a Cellulac group company. The instalment will be secured by way of a charge and guarantee granted by Pursuit Marine Drive in favour of the Company to be executed and delivered on completion of the Disposal Agreement. Pursuant to the Disposal Agreement, it is envisaged that certain contracts comprising the "AlgaeParc Contract", the "FP7 Projects" and the Contracts (each term as defined in the Disposal Agreement) will either before or after exchange be novated and/or assigned from the Company to Cellulac and/or Pursuit Marine Drive. Cellulac has agreed to hold the Company harmless in respect of the performance of any obligations arising out of or in respect of those transferring contracts unless and until such time as the contracts are novated or assigned, and also where any such contract is and/or has been assigned or terminated.

The Disposal Agreement contains limited commercial warranties and standard form warranties in relation to title, capacity and solvency of the Company, which are given by the Company at the date of the Disposal Agreement, in favour of Cellulac. The Disposal Agreement also contains certain customary protections in favour of the Company, limiting the scope of any breach of the terms of the Disposal Agreement.

Under the terms of the Disposal Agreement, Cellulac also provides certain customary warranties in favour of the Company.

Principal Terms of the Acquisitions

On 15 July 2013, the Company entered into the three separate Acquisition Agreements under which it has conditionally agreed to acquire:

1. the entire issued share capital of Gaming Realms Limited for a purchase price of £7,500,000 satisfied by the issue of 57,692,309 Consideration Shares valued at the Placing Price;

2. 100 per cent. of the issued share capital of BeJig not already owned by Gaming Realms Limited for a purchase price £3,511,988.15 satisfied by the issue of 27,015,293 Consideration Shares valued at the Placing Price;

3. 100 per cent. of the issued share capital of AlchemyBet not already owned by Gaming Realms Limited for a purchase price £1,069,046.68 satisfied by the issue of 8,223,435 Consideration Shares valued at the Placing Price.

Each of the Acquisition Agreements is conditional upon, inter alia, Admission and each of the conditions precedent in the Placing Agreement having been satisfied or waived, including the passing of the Resolutions.

The Placing

At the Placing Price, the Placing will raise approximately £3.4 million for the Company.

The Placing, which is not being underwritten, is conditional, inter alia, upon:

·; the Placing Agreement becoming unconditional and not having been terminated in accordance with

its terms prior to Admission;

·; the Acquisition Agreements becoming unconditional (save for Admission) and not having been

terminated; and

·; Admission becoming effective not later than 1 August 2013, or such later date as Cenkos and the

Company may agree, being not later than 6 August 2013.

The Placing comprises an aggregate 26,230,846 New Ordinary Shares being issued by the Company.

The Placing Shares will rank pari passu in all respects with the other New Ordinary Shares including the right to receive all dividends and other distributions declared, paid or made after the date of issue.

None of the Placing Shares have been marketed to or will be made available in whole or in part to the public in conjunction with the application for Admission. The market capitalisation of the Company immediately following the Placing, at the Placing Price, will be approximately £19.0 million. Application has been made to the London Stock Exchange for the Enlarged Issued Share Capital to be admitted to trading on AIM.

Admission is expected to become effective and dealings in the Enlarged Issued Share Capital are expected to commence on 1 August 2013.

Jim Ryan and Mark Wilson have agreed to subscribe for 384,615 New Ordinary Shares each under the Placing.

Lock-Ins and Orderly Market Arrangements

Immediately following Admission, the Proposed Directors will be interested, in aggregate, in 42,182,282 New Ordinary Shares representing approximately 28.8 per cent., of the Enlarged Issued Share Capital of the Company. In accordance with Rule 7 of the AIM Rules, each of the Proposed Directors and NewGame has undertaken to Cenkos Securities and the Company not to sell, transfer or dispose of any of the Company's securities save in accordance with the AIM Rules, for a period of 12 months following Admission (and shall procure that its related parties do the same). The Proposed Directors and NewGame further undertake that for a further 12 months they will only dispose of New Ordinary Shares through the Company's broker from time to time (and shall procure that its related parties do the same).

New Share Option Schemes

The Proposed Directors believe that the success of the Company will depend to a high degree on the management team being appropriately motivated and rewarded. The Company has therefore established conditional on Admission the New Share Option Scheme which will reward the participants if shareholder value is created, thereby aligning the interests of the Proposed Directors directly with those of the Shareholders.

B Shares

The following options have, subject to Admission, been granted under the New Share Option Schemes.

Name Number of B Shares

Patrick Southon 5,769,230

Michael Buckley 5,769,230

Simon Collins 4,615,384

Noel Rowse 4,615,384

Mark Segal 3,076,923

Irek Galecki 2,307,692

There are no B Shares currently in issue. It is intended that B Shares will be issued only when EMI Options granted under the New Share Option Scheme are exercised. The EMI options can only be granted to employees who meet the statutory working time requirement, and cannot normally be exercised before 15 July 2015.

Under the New Articles, the B Shares, once issued, will have no voting rights, will only be transferrable with the consent of the Board and will not be admitted to AIM. Their value will be 20 pence less than the prevailing price of the New Ordinary Shares. They will therefore have no value unless the value of the New Ordinary Shares exceeds 20 pence. On a takeover offer or on a winding up, subject to the code, the B Shareholders may be entitled to receive 20 pence in value per B Share they hold less than the Shareholders will receive per New Ordinary Share they hold. If a dividend is declared, they will receive a dividend calculated by reference to dividend payable per New Ordinary Share scaled back to reflect the relative value of the New Ordinary Shares and the B Shares.

If a B Shareholder wishes to sell their B Shares, they are entitled to require the Company to do one of three things. The Company can elect, at its discretion to either (i) buy the shares back, (ii) arrange for a third party to buy them or (iii) convert the relevant B Shares into New Ordinary Shares. The price at which the Company or a third party must buy the shares is calculated by deducting 20 pence from the average volume weighted average price of an New Ordinary Share measured over the 30 trading days prior to the B Shareholder notifying the Company they wish to sell. On a conversion, a B Shareholder receives New Ordinary Shares with an equivalent value to the cash they would have received if the relevant B Shares were purchased by the Company or a third party.

All options granted under the New Share Option Scheme on Admission will be exercisable over B Shares at their nominal value of £0.01 and will be capable of exercise, subject to certain exceptions, after two years of the date of grant.

The number of New Ordinary Shares a B Shareholder would receive if the Company elected to convert B Shares in these circumstances would depend on the then value of the New Ordinary Shares. As the value of the New Ordinary Shares increases, the number of New Ordinary Shares a B Shareholder would receive increases but will never exceed the number of B Shares held by a B Shareholder as the value of a B Share will always be less than the value of a New Ordinary Share of the time of conversion.

The number of New Ordinary Shares a B Shareholder would receive if the Company elected to convert B Shares in these circumstances would depend on the then value of the New Ordinary Shares. As the value of the New Ordinary Shares increases, the number of New Ordinary Shares a B Shareholder would receive increases but will never exceed the number of B Shares held by a B Shareholder as the value of a B Share will always be less than the value of a New Ordinary Share of the time of conversion.

The maximum number of B Shares that could be issued if all the options over the B Shares were exercised and the resulting B Shares then converted into New Ordinary Shares is 26,153,837, representing 15.2 per cent. of the Enlarged Issued Share Capital and assuming all B Shares are converted into New Ordinary Shares.

In addition, a B Shareholder must sell their B Shares if they cease to be an employee or director of any group company in accordance with the same process as if they were a voluntary seller.

The table below sets out the shareholdings of the B Shareholders and their total interest in New Ordinary Shares assuming all options over the B Shares are exercised and all B Shares are converted into New Ordinary Shares.

Unapproved Options

In addition and conditional on Admission and the passing of the Resolutions the Company has granted the following Unapproved Options, all exercisable at the Placing Price:

Name Number of New Ordinary Shares

Jim Ryan 769,230

Mark Wilson 769,230

The Unapproved Options will have the same rights as the options granted over the B Shares, save that the exercise price will be 13 pence per New Ordinary Share.

Takeover Code and Whitewash Resolution

The Takeover Code governs, inter alia, transactions which may result in a change of control of a company to which the Takeover Code applies. Under Rule 9 of the Takeover Code any person who acquires, whether by a series of transactions over a period of time or not, an interest (as defined in the Takeover Code) in shares which, taken together with shares in which he is already interested or in which persons acting in concert with him are interested, carry 30 per cent. or more of the voting rights of a company which is subject to the Takeover Code, that person is normally required to make a general offer to all the remaining shareholders to acquire their shares.

Similarly, Rule 9 of the Takeover Code also provides that when any person, together with persons acting in concert with him, is interested in shares which, in aggregate, carry more than 30 per cent. of the voting rights of such company, but does not hold shares carrying 50 per cent. or more of such voting rights, a general offer will normally be required if any further interest in shares is acquired by any such person.

Rule 9 of the Takeover Code further provides, among other things, that where any person who, together with persons acting in concert with him holds over 50 per cent. of the voting rights of a company, then they will not generally be required to make a general offer to the other shareholders to acquire the balance of their shares.

An offer under Rule 9 must be in cash and must be at the highest price paid by the person required to make the offer, or any person acting in concert with him, for any interest in shares of the company in question during the 12 months prior to the announcement of the offer.

Persons acting in concert include persons who, pursuant to an agreement or understanding (whether formal or informal), co-operate, to obtain or consolidate control of that company.

Waiver

Relationship between members of the Concert Party

The members of the Concert Party are made up of founding shareholders, employees and capital providers in each of the Targets. The majority of the members of the Concert Party have been influential in setting up and creating value in each of the Targets. NewGame provided seed capital to BeJig and AlchemyBet, alongside two of the Proposed Directors, Patrick Southon and Simon Collins. Bwin.party, through its large shareholding in NewGame is also a member of the Concert Party.

Effects of Proposals and requirement for the Waiver

Immediately following Completion, the members of the Concert Party will between them own 83,664,401 New Ordinary Shares (representing 57.09 per cent. of the Enlarged Share Capital). Furthermore, certain members of the Concert Party will have options over 26,153,843 B Shares proposed to be granted under the New Share Option Scheme which on full conversion would represent a maximum controlling position of 64.64 per cent. of the Enlarged Issued Share Capital assuming all B Shares are converted into New Ordinary Shares. The earliest date on which the options can be exercised is the second anniversary following Admission.

The Takeover Panel has agreed, however, to waive the obligation to make a general offer that would otherwise be required as a result of the allotment and issue of the Consideration Shares and full conversion of the B Shares pursuant to the Proposals. Accordingly, the Whitewash Resolution seeks to waive the requirement under Rule 9 of the City Code that the Concert Party, having acquired a shareholding and percentage of voting rights exceeding 30 per cent., must make a general cash offer to all the remaining Shareholders to acquire their shares In accordance with the City Code, the Whitewash Resolution is being proposed at the General Meeting and will be taken on a poll. The Concert Party will not be entitled to vote on the Whitewash Resolution. To be passed, the Whitewash Resolution will require a simple majority of votes entitled to be cast to vote in favour.

Following Completion, the Concert Party will have acquired in aggregate interests in shares carrying approximately 57.09 per cent. of the voting rights of the Company (or a maximum interest of approximately 64.64 per cent. of the voting rights assuming full conversion of the B shares) which, without a waiver of the obligations under Rule 9, would oblige the Concert Party to make a general offer to Shareholders under Rule 9.

Shareholders should note that, following the completion of the Placing, the Concert Party will together hold over 50 per cent. of the voting rights of the Company and will therefore be entitled to increase their interest in the voting rights of the Company without incurring a further obligation under Rule 9 of the Code to make a general offer. However, should any individual member of the Concert Party acquire an interest in shares of the Company such that they are interested in 30 per cent. or more of the voting rights in the Company, the Panel may regard this as giving rise to an obligation upon that member of the Concert Party to make an offer for the entire issued share capital of the Company at a price no less than the highest price paid by the individual member of the Concert Party or any other member of the Concert Party in the previous 12 months.

Share Consolidation and Amendment to Articles

As part of the Proposals, the Company is seeking Shareholder consent to approve the Share Consolidation and to amend the Articles.

The purpose of the Share Consolidation is to reduce the total number of shares in issue following completion of the Proposals. The Directors and the Proposed Directors believe that this may reduce the volatility in the price of the Company's shares, lead to more meaningful earnings per share figures, may avoid large dealing spreads in the shares and may ensure that the price of the shares is more appropriate for a company of Pursuit Dynamics's or Gaming Realm's size.

Under the terms of the Share Consolidation, it is proposed that the issued Existing Ordinary Shares will be consolidated so that every 10 such Existing Ordinary Shares of 1 pence each will be consolidated into one New Ordinary Share of 10 pence. Shareholders with a holding of Existing Ordinary Shares which is not exactly divisible by 10 will have their holdings rounded down to the nearest whole number of New Ordinary Shares. Holders of fewer than 10 Existing Ordinary Shares will not be entitled to receive any New Ordinary Shares following the Share Consolidation. Any fractions arising from the Share Consolidation (being less than 10 Existing Ordinary Shares) will be aggregated, sold and the benefit retained by the Company.

All outstanding options granted under the Existing Share Option Schemes will be adjusted so that the shares under option will be consolidated in the same way as the Existing Ordinary Shares and the exercise price per share adjusted accordingly and relevant Optionholders will be notified accordingly. Any adjustment to such options will be carried out in accordance with the rules of the applicable Exiting Share Option Scheme, which may, in some cases, require prior confirmation from the Company's auditors that such adjustment is fair and reasonable.

All Consideration Shares and all Placing Shares will be allotted on a post-Share Consolidation basis, as will be options granted to option holders pursuant to both the New Share Option Scheme and the Unapproved Options.

The purpose of amending the Articles is to update the provisions contained therein to reflect the requirements of current legislation the requirements of the Enlarged Group post Admission and to incorporate the rights of the B Shares and the Deferred Shares.

Authority for the Share Consolidation and to adopt the New Articles will be sought by the proposal of the relevant Resolutions at the General Meeting. Following the Share Consolidation, replacement share certificates will be despatched to Shareholders in respect of newly denominated New Ordinary Shares held in certificated form. Share certificates are expected to be despatched by 15 August 2013. Existing certificates will be void. In respect of Existing Ordinary Shares held in uncertificated form, CREST accounts will be credited with the newly denominated New Ordinary Shares on the record date for the Share Consolidation, being 31 July 2013.

Authority to Allot/Subscribe for Shares and Disapplication of Pre-emption Rights

Authority will be sought by the proposal of the relevant Resolution at the General Meeting to grant the Directors authority to allot the Consideration Shares and the Placing Shares. In addition, the Company is also seeking shareholder authority to grant the Unapproved Options and to grant the Cenkos Option, and a general shareholder authority to authorise the Board to allot and issue shares and/or grant rights to subscribe for or to convert any security into shares following Admission equal to 10 per cent. of the Enlarged issued Share Capital.

Authority will also be sought at the General Meeting to disapply statutory pre-emption rights in relation to such share allotments and/or rights to subscribe for shares.

Change of Name

To reflect the proposed changes to the Company, its management and its operations as a result of the Acquisitions, it is proposed that the Company will change its name to Gaming Realms plc pursuant to Resolution 8 in the Notice. At the same time Gaming Realms Limited will change its name to Bingo Realms Limited.

Dividend Policy

The Company has never declared or paid cash dividends on the Existing Ordinary Shares. The payment of any future dividends will depend on the future earnings of the Company. The Board has no current intention of paying a cash dividend to Shareholders as the Company currently intends to invest its cash reserves and any cash generated into funding the Enlarged Group's planned development.

General Meeting

There is a notice convening the General Meeting appended to the Admission Document, which is to be held at the offices of Memery Crystal LLP, 44 Southampton Buildings, London WC2A 1AP at 10.00 a.m. on 31 July 2013, for the purpose of considering, and if thought fit, passing the following Resolutions:

1. to approve the Disposal;

2. to approve the Acquisitions;

3. to approve the Rule 9 Waiver;

4. to authorise the directors of the Company to allot and issue the Consideration Shares, the Placing Shares and allot/grant rights to subscribe for 2,195,005 New Ordinary Shares to Cenkos pursuant to the Cenkos Option and 1,538,460 New Ordinary Shares pursuant to the Unapproved Options and other equity securities up to an aggregate nominal amount of £1,463,337 ("Authorised Shares") being equal to 10 per cent. of the Enlarged Issued Share Capital;

5. to disapply pre-emption rights in relation to the allotment and issue of the Consideration Shares, the

Placing Shares, Unapproved Options, the Cenkos Option and the Authorised Shares;

6. to approve the Share Consolidation;

7. to approve the adoption by the Company of the New Articles of Association;

8. to approve the change of name to "Gaming Realms plc".

To be passed, the Resolutions (other than the Whitewash Resolution) proposed to be passed as ordinary resolutions will require a simple majority, and the Resolutions proposed to be passed as special resolutions will require a majority of not less than 75 per cent. voting in person or on a poll by proxy in favour of the relevant Resolution. The Whitewash Resolution will require the approval of a majority of the Independent Shareholders. The Whitewash Resolution will be taken on a poll vote of the Independent Shareholders.

A copy of the New Articles will be available at the General Meeting and is also available for inspection at the

Company's registered office and on the Company's website.

Admission, Crest and Settlement

Application has been made to the London Stock Exchange for the Enlarged Issued Share Capital to be admitted to trading on AIM. It is expected that Admission will become effective and that dealings in the Enlarged Issued Share Capital will commence on AIM at 8.00 a.m. on 1 August 2013 (whereupon an announcement will be made by the Company to a Regulatory Information Service).

Application has been made for all of the Enlarged Issued Share Capital to be eligible for admission to CREST with effect from Admission. Accordingly, settlement of transactions in the Enlarged Issued Share Capital following Admission may take place in CREST if the relevant Shareholder so wishes. CREST is a paperless settlement procedure enabling securities to be evidenced otherwise than by a share certificate and transferred otherwise than by written instrument. The New Articles permit the holding and transfer of New Ordinary Shares under the CREST system. CREST is a voluntary system and Shareholders who wish to receive and retain share certificates will be able to do so. Persons acquiring shares as a part of the Placing may elect to receive New Ordinary Shares in uncertificated form if, but only if, that person is a "system-member" (as defined in the CREST Regulations) in relation to CREST.

Recommendation

Michael Buckley, Patrick Southon, Simon Collins and Mark Segal are Proposed Directors, and have not taken part in any decision of the Directors relating to any proposal to seek a waiver of Rule 9 from the Panel since it is their potential shareholdings which are the subject of the Rule 9 Waiver. No members of the Concert Party are able to vote on the Rule 9 Waiver.

In addition, the Directors, who have been so advised by Cenkos Securities, consider that the approval of the terms of the Whitewash Proposals are fair and reasonable and in the best interests of the Shareholders and the Company as a whole. In providing advice to the Directors, Cenkos Securities plc has taken account of the Directors' commercial assessment.

Additionally, the Directors consider that the Proposals are in the best interests of the Company and Shareholders as a whole. Furthermore, Cenkos Securities considers that the options over the B Shares under the New Share Option Scheme are fair and reasonable so far as the Company's shareholders are concerned.

Accordingly, the Directors unanimously recommend that Shareholders vote in favour of the Resolutions to be proposed at the General Meeting, as they intend to in respect of their own beneficial shareholdings amounting to, in aggregate, 2,362 Existing Ordinary Shares representing 0.001 per cent. of the existing issued share capital of the Company as at the date of the Admission Document.

Furthermore, Michael Buckley, one of the Proposed Directors, has confirmed that he intends to vote in favour of the Resolutions to be proposed at the General Meeting (save for Resolution 3) in respect of his own beneficial shareholding amounting to, in aggregate, 21,000,000 Existing Ordinary Shares representing approximately 7.73 per cent. of the existing issued share capital of the Company as at the date of the Admission Document.