Monitise Regulatory News (MONI)

24 March, 2014

THIS ANNOUNCEMENT AND THE INFORMATION CONTAINED HEREIN IS RESTRICTED AND IS NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, DIRECTLY OR INDIRECTLY, IN WHOLE OR IN PART, IN, INTO OR FROM THE UNITED STATES, AUSTRALIA, CANADA, JAPAN, OR THE REPUBLIC OF SOUTH AFRICA OR ANY OTHER JURISDICTION IN WHICH THE SAME WOULD BE UNLAWFUL

Monitise plc

Fully-underwritten Placing of 160,643,031 new shares to accelerate shift to global subscription-based business

Major existing shareholders and new partner MasterCard intend to participate in Placing

Worldwide rollout of the Monitise Commerce Network

New partnerships announced as Monitise targets 200m registered users by FY 2018

Highlights

· Fully-underwritten Placing of 160,643,031 new Ordinary Shares by way of an accelerated bookbuild to accelerate the Group's shift from a licence/services-based business model to a subscription-based model.

· Certain major existing shareholders and new partner MasterCard have indicated their intention to participate in the Placing.

· Investment supports rapid move to subscription-based sales model, minimising upfront licence or integration costs to customers, and generating higher long-term recurring revenue for Monitise.

· New model reduces financial and technical barriers to customer on-boarding, accelerating end-user adoption at a key inflection point in demand for mobile financial services.

· New five-year Key Performance Indicator targets for end of FY 2018. These include:

o Registered users expected to grow from 28m today to 200m by making it financially and technically easier for network partners to connect to the Monitise Group network.

o ARPU target of at least £2.50 per annum - comprising Bank Anywhere subscription revenue and Pay Anyone, Buy Anything transaction revenue.

o User-generated revenue will represent around 80% of Monitise total group revenue, the remaining amount being professional services revenue from custom-build projects including Monitise Create.

o Sustainable Gross Margin above 70% with EBITDA margin of at least 30%.

· Global rollout of the Monitise Commerce Network, an interoperable payment and shopping network involving a standard Open API interface to the Monitise Central Platform for mobile users to pay anyone and buy anything while also staying on top of their finances.

· New partners include global payments business MasterCard, which has indicated it will participate in the Placing, and payment solutions provider Ingenico. These companies join Monitise's existing global ecosystem of partners, all of which are committed to a global Mobile Money landscape built on best-in-class platforms and services.

· The ecosystem already includes more than 350 banks such as U.S. Bank, Fifth Third Bank, American Savings Bank, RBS, Lloyds, Türkiye İş Bankası, the largest bank in Turkey, and other payment services companies such as Visa Inc. and Visa Europe, Vocalink, FIS, JetCo and BKM, Turkey's national payments switch. Monitise customers also include ANB, one of the largest 15 banks in the Middle East. In the mobile space partners include Telefónica, BlackBerry, PCCW Mobile, Turkcell and Samsung and in the retail ecosystem they include brands such as Blackhawk Network Holdings with its network of more than 500 content providers operating in the US and 18 other countries, eBay, Turkey's Bilyoner and Biletix, Venda, B&Q, Carphone Warehouse, Premier Inn, with many more expected.

Monitise Chief Executive Alastair Lukies said:

"For generations to come people's lives will evolve around smarter technology and their smartphone. The frontscreen apps on your smartphone are the remote control to your life. The next generation will bank, pay and buy through their mobile smartphone or tablet. We have established a foothold at the centre of this digital payments revolution for the world's banks and payment networks and now intend to fully leverage our technology platforms, expertise and global network of partnerships to lead the way in what we believe will be the biggest shift in financial services and shopping in a generation.

At a pivotal time in the Monitise journey, the Group is now embarking on a new chapter in Mobile Money innovation as it accelerates its move to a subscription-based business model. By adopting this approach, the Group is looking to ensure that its secure platform technology is accessible to the widest possible number of people. Monitise is executing on a unique opportunity to capitalise on the strong foundations the Group has developed and creating the ecosystem for a new era of commerce."

Monitise Chairman Peter Ayliffe commented:

"Monitise's success in mobile banking, payments and commerce is all about creating the right products and business model to enable our partners to participate in a timely and cost-efficient manner in exchange for a longer-term annuity based revenue share. This model has been the most effective for all existing payment providers and now is absolutely the right time for Monitise to evolve, enabling it to capture the transformational market opportunity that exists.

From today, Monitise is deploying a revenue model that will enable us to accelerate our growth story in the medium term and this will unlock enormous benefits to us and importantly all our stakeholders."

Strategy update

In June 2007 when Monitise became a public company, the Group's technology platform was only available to banks through LINK, the UK ATM switch. It provided people with a Java front-end application and the ability to use SMS to check balances or top up a mobile phone.

Seven years later and smartphones and tablets have transformed our lives. We are living in a world that has never been more connected. What were previously regarded as aggressive predictions for smartphone uptake and usage have been easily surpassed. Last year worldwide mobile ad spending more than doubled to nearly $18bn and, according to figures out earlier this month from eMarketer, it is set to rise 75% this year to $31.45bn. Industries are rethinking their business models as more consumers shop by mobile phone and tablets.

Monitise has established itself as the world's premier provider of secure, reliable, intuitive and relevant mobile technology services to the financial services industry. Monitise's globally deployed and trusted Mobile Money solutions enable our partners and clients to 'defend and extend' their offerings to an increasingly mobile customer base.

In summary, Monitise now helps:

Banks: Deepen their customer relationships via increased customer engagement, rebuild trust in their brands, create new partnerships, reduce costs and drive new revenues.

Payments companies: Deepen consumer loyalty, increase interchange and generate new revenue streams.

Mobile operators: Fight back against 'over-the-top' disruptors, enhance subscriber stickiness, develop new partnerships, and increase annuity revenues.

Retailers: Substantially improve the precision of their marketing via enhanced ROI, build loyalty with existing customers and expand distribution.

Network partners: (Media and advertising, loyalty, coupon, offers companies) reach a far greater audience, substantially increase conversion rates, learn more about their customers, develop new partnerships.

· Mobile banking goes mainstream

The move from early adopter to mass-market consumer engagement means now is the time to accelerate adoption by offering lower initial cost-to-connect Mobile Money capabilities. With the increasing use of smart mobile devices, mobile banking adoption continues to grow, not least because mobile is no longer seen as an alternative customer engagement channel. This is particularly evident in markets like the US where data from Alix Partners show that 82% of 18-to-25 year olds have a smartphone and 61% of these are already using mobile banking. This compares with around 60% and 30% respectively for their parents.

Key to mobile banking is the fact that when done properly, consumers log in to their mobile banking app almost every day. This makes the app a highly valuable 'frontscreen' piece of smartphone real-estate. It is right behind the browser, email, social networking, and messaging app in frequency of use. These eyeballs are highly prized. Individual banks do not have the user base to compete with the big digital platforms, especially in highly-fragmented financial services markets like the US and Germany. But aggregated together they are already a formidable audience.

Central banks, regulators, governments, businesses and consumer groups will look to companies at the centre of this huge Mobile Money market to be robust, resilient, compliant and sustainable. Banking, payments and commerce rely on a golden rule of interoperability and 'open network' infrastructure. Our open mass-market network is a key step in providing a globally-accepted, accessible and agile Mobile Money payment platform.

Monitise has spent 10 years building expertise, trust and experience. The Group now has 28m registered users and the value of payments and transfers initiated via Monitise's patented platform technology is now worth $71bn on an annualised basis as at January 2014. The Group handles around 3.5bn transactions on an annualised basis and provides Mobile Money services to more than 350 financial institutions. This provides an extremely strong foundation from which to scale the Group.

· Monitise Commerce Network

The new approach Monitise is offering will make it easier for financial institutions, payment companies, mobile operators, retailers and network partners to connect to an increasingly mobile population. Monitise's Central Platform provides the services and functionality required to manage and grow the new ecosystem. While system integration capabilities continue to be provided by the Monitise Enterprise and Vantage platforms, each including a standard API interface to the Monitise Central Platform, customers can opt to use their own technology to connect directly to Monitise. As part of the Group's evolving capabilities, content and service providers, including new industry schemes, can also connect directly to the published Open APIs of the central platform.

Supporting this, Monitise is also announcing today the launch of Monitise Signature™, a PCI-compliant bank-grade data analytics engine that combines consumer-empowered profiling with transactional and behavioural intelligence. This user-defined preference engine will enable richer one-to-one targeting to deliver personalised marketing that is adaptive and intuitive.

· Subscription model

Until now, Monitise's business model has usually included upfront licence and/or integration revenue. The shift to a purer subscription business model with minimal upfront licence or integration costs means financial barriers to adoption will be lowered. Given the fact that there will be no significant upfront capital expenditure required for our customers, we expect that this will lead to higher long-term annuities, based on revenue-sharing. The revised business model and offering should result in an accelerated sales process to banks and payment providers, both for the Monitise direct sales team as well as Monitise's channel partners.

By adopting a subscription business model with minimal upfront costs for network partners and accelerating the Group's moves towards industry-benchmark products and solutions, Monitise is ensuring that its secure platform technology is accessible to the widest number of possible players in the ecosystem fuelling Mobile Money - the ability to bank, pay or buy across a smartphone or tablet.

Use of proceeds and financial guidance

The proceeds from the Placing will enable the Company to transition from a licence/services business model to a subscription model with the aim of accelerating customer onboarding and end-user growth. The proceeds will be utilised as follows:

· 1/3 will be used on identified platform spend. Depending on exact timing of spend FY 2014 capex including capitalised R&D will be £20-30m (FY 2013 £14m), and £30-40m in FY 2015.

· 2/3 covers the cost ramp for the operating cost element of the adoption of the new business model, the short-term reduction in revenue growth, and sufficient contingency to enable laser-sharp focus on execution.

The transition away from upfront licence or integration revenue to a purer subscription business model is a well-trodden path in the software world and commonly results in a near-term slowdown in revenue growth followed by an acceleration in recurring user-generated revenue growth.

We now expect FY 2014 revenue growth of approximately 40%, compared to previous guidance of 50%. This expected reduction in revenue growth and an acceleration in operating expenses will likely result in H2 FY 2014's EBITDA loss to exceed H1 FY 2014.

In FY 2015 we expect continued revenue growth, albeit at a lower rate than FY 2014.

In FY 2016, Monitise expects to be EBITDA profitable, a year later than current sell-side analyst consensus. In the same year we expect revenue growth to accelerate strongly.

By the end of FY 2018, we target 200 million registered users generating ARPU of £2.50, and that this user-generated revenue base will account for approximately 80% of total revenue. We also target an EBITDA margin of at least 30%.

Details of the Placing

The Placing is being conducted by way of an accelerated bookbuild process (the "Bookbuild"). The Bookbuild will open with immediate effect following this announcement. Barclays Bank PLC ("Barclays") and Canaccord Genuity Limited ("Canaccord Genuity") are acting as Joint Bookrunners (together, the "Joint Bookrunners", and each a "Joint Bookrunner") in connection with the Placing. The price (the "Placing Price") at which the 160,643,031 new ordinary shares of one pence each ("Ordinary Shares") to be issued by the Company pursuant to the Placing (the "Placing Shares") are to be placed with investors will be agreed by the Joint Bookrunners and the Company at the close of the Bookbuild and will be announced as soon as practicable thereafter.

Participation in the Placing will be limited to certain institutional and other investors. Members of the general public are not eligible to take part in the Placing. The appendix to this announcement contains detailed terms and conditions applicable to the Placing.

The Placing has been fully underwritten by Barclays and Canaccord Genuity subject to the terms, conditions and termination rights set out in the placing agreement between the Company, Barclays and Canaccord Genuity (the "Placing Agreement"). Further details of the Placing Agreement can be found in the appendix to this announcement.

The Placing Shares represent 9.5 per cent. of the Company's existing issued ordinary share capital, and will be issued by the Company pursuant to existing authorities granted to the Directors. The Placing Shares, when issued, will be credited as fully paid and will rank pari passu with the existing issued Ordinary Shares, including the right to receive all dividends and other distributions declared, made or paid on or in respect of the Ordinary Shares after the date of issue of the Placing Shares.

Application will be made for the Placing Shares to be admitted to trading on AIM ("Admission"), and it is expected that Admission will become effective, and trading in the Placing Shares will commence, on AIM at 8.00 a.m. on 28 March 2014. 

This announcement should be read in its entirety. In particular, your attention is drawn to the "Important Notice" section of this announcement and to the detailed terms and conditions of the Placing contained in the appendix to this announcement. By choosing to participate in the Placing and by making an oral and legally binding offer to acquire Placing Shares, investors will be deemed to have read and understood this announcement in its entirety, including the appendix (the "Announcement"), and to be making such offer on the terms and subject to the conditions contained herein and to be making the representations, warranties, undertakings and acknowledgements contained in the appendix to this Announcement.

About Monitise

Monitise (LSE: MONI) is a world leader in Mobile Money - banking, paying and buying with a mobile device. Leading banks, payments companies, retailers and mobile networks utilise Monitise's technology platforms and services to securely connect people with their money. 

Already 28 million consumers benefit from Monitise's patented technology to 'bank anywhere', 'pay anyone' and 'buy anything', accounting for $71bn of payments, purchases and transfers annually.

More information is available at www.monitise.com.

IMPORTANT NOTICE

This Announcement is for information purposes only and does not constitute an offer to sell or issue or the solicitation of an offer to buy or acquire shares in the capital of the Company in the United States, Australia, Canada, Japan or the Republic of South Africa or any other jurisdiction in which such offer or solicitation would be unlawful or require preparation of any prospectus or other offer documentation or would be unlawful prior to registration, exemption from registration or qualification under the securities laws of any such jurisdiction. Any failure to comply with these restrictions may constitute a violation of the securities laws of such jurisdictions.

The Placing Shares have not been and will not be registered under the United States Securities Act of 1933, as amended ("Securities Act") or with any securities regulatory authority of any state or other jurisdiction of the United States, and may not be offered, sold, pledged or otherwise transferred, directly or indirectly, within the United States except pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act and the securities laws of any state or other jurisdiction of the United States. Any offering to be made in the United States will be made to a limited number of "qualified institutional buyers" ("QIBs") within the meaning of Rule 144A under the Securities Act and/or "accredited investors" ("AIs") pursuant to an exemption from registration under the Securities Act in a transaction not involving any public offering. The Placing Shares are being offered and sold outside the United States in accordance with Regulation S under the Securities Act ("Regulation S").

No public offering of the shares referred to in this Announcement is being made in the United States, United Kingdom or elsewhere.

The distribution of this Announcement and the offering of the Placing Shares in certain jurisdictions may be restricted by law. No action has been taken by the Company or the Joint Bookrunners that would permit an offering of such shares or possession or distribution of this Announcement or any other offering or publicity material relating to such shares in any jurisdiction where action for that purpose is required. Persons into whose possession this Announcement comes are required by the Company and the Joint Bookrunners to inform themselves about, and to observe, any such restrictions.

This Announcement has been issued by, and is the sole responsibility, of the Company. No representation or warranty, express or implied, is or will be made as to, or in relation to, and no responsibility or liability is or will be accepted by the Joint Bookrunners or by any of their respective affiliates or agents as to or in relation to, the accuracy or completeness of this Announcement or any other written or oral information made available to or publicly available to any interested party or its advisers, and any liability therefore is expressly disclaimed.

Barclays Bank PLC, which is authorised by the Prudential Regulation Authority ("PRA") and regulated by the FCA and the PRA in the United Kingdom, is acting exclusively for the Company and no-one else in connection with the Placing and Admission, will not regard any other person as its client in relation to the Placing and Admission, and will not be responsible to any person other than the Company for providing the protections afforded to clients of Barclays Bank PLC, nor for providing advice in relation to the Placing, Admission or any other matter referred to in this Announcement.

Canaccord Genuity Limited, which is authorised and regulated by the Financial Conduct Authority (the "FCA") in the United Kingdom, is acting exclusively for the Company as Nominated Adviser and broker to the Company for the purposes of the AIM Rules for Companies and the AIM Rules for Nominated Advisers and no-one else in connection with the Placing and Admission, will not regard any other person as its client in relation to the Placing and Admission, and will not be responsible to any person other than the Company for providing the protections afforded to clients of Canaccord Genuity Limited, nor for providing advice in relation to the Placing, Admission or any other matter referred to in this Announcement.

The price of shares and the income from them may go down as well as up and investors may not get back the full amount invested on disposal of the shares. Past performance is no guide to future performance and persons who require advice should consult an independent financial adviser.

The Placing Shares to be issued pursuant to the Placing will not be admitted to trading on any stock exchange other than to AIM.

Neither the content of the Company's website nor any website accessible by hyperlinks on the Company's website is incorporated in, or forms part of, this Announcement.

This Announcement has been prepared for the purposes of complying with applicable law and regulation in the United Kingdom and the information disclosed may not be the same as that which would have been disclosed if this Announcement had been prepared in accordance with the laws and regulations of any jurisdiction outside the United Kingdom.

FORWARD-LOOKING STATEMENTS

This announcement contains (or may contain) certain forward-looking statements with respect to certain of Monitise's plans and its current goals and expectations relating to its future financial condition and performance and which involve a number of risks and uncertainties. Monitise cautions readers that no forward-looking statement is a guarantee of future performance and that actual results could differ materially from those contained in the forward-looking statements. These forward-looking statements can be identified by the fact that they do not relate only to historical or current facts. Forward-looking statements sometimes use words such as "aim", "anticipate", "target", "expect", "estimate", "intend", "plan", "goal", "believe", "predict" or other words of similar meaning. Examples of forward-looking statements include, amongst others, statements regarding or which make assumptions in respect of the planned use of the proceeds for the Placing, the liquidity position of Monitise and its subsidiary undertakings (collectively, the "Group"), the future performance of the Group, future foreign exchange rates, interest rates and currency controls, the future political and fiscal regimes in the overseas markets in which the Group operates, the Group's future financial position, plans and objectives for future operations and any other statements that are not historical fact. By their nature, forward-looking statements involve risk and uncertainty because they relate to future events and circumstances, including, but not limited to, economic and business conditions, the effects of continued volatility in credit markets, market-related risks such as changes in interest rates and foreign exchange rates, the policies and actions of governmental and regulatory authorities, changes in legislation, the further development of standards and interpretations under International Financial Reporting Standards ("IFRS") applicable to past, current and future periods, evolving practices with regard to the interpretation and application of standards under IFRS, the outcome of pending and future litigation or regulatory investigations, the success of future acquisitions and other strategic transactions and the impact of competition. A number of these factors are beyond Monitise's control. As a result, Monitise's actual future results may differ materially from the plans, goals, and expectations set forth in Monitise's forward-looking statements. Any forward-looking statements made in this Announcement by or on behalf of Monitise speak only as of the date they are made. These forward-looking statements reflect Monitise's judgement at the date of this Announcement and are not intended to give any assurance as to future results. Except as required by applicable law, the FCA, the London Stock Exchange plc, the AIM Rules for Companies, Monitise expressly disclaims any obligation or undertaking to release publicly any updates or revisions to any forward-looking statements contained in this Announcement to reflect any changes in Monitise's expectations with regard thereto or any changes in events, conditions or circumstances on which any such statement is based.

APPENDIX: TERMS AND CONDITIONS OF THE PLACING

THIS ANNOUNCEMENT, INCLUDING THIS APPENDIX (TOGETHER, THE "ANNOUNCEMENT") AND THE INFORMATION IN IT IS RESTRICTED AND IS NOT FOR PUBLICATION, RELEASE OR DISTRIBUTION, DIRECTLY OR INDIRECTLY, IN WHOLE OR IN PART, IN OR INTO THE UNITED STATES, AUSTRALIA, CANADA, JAPAN OR THE REPUBLIC OF SOUTH AFRICA OR ANY OTHER JURISDICTION IN WHICH PUBLICATION OR DISTRIBUTION WOULD BE UNLAWFUL

IMPORTANT INFORMATION ON THE PLACING FOR INVITED PLACEES ONLY

MEMBERS OF THE PUBLIC ARE NOT ELIGIBLE TO TAKE PART IN THE PLACING. THIS APPENDIX AND THE TERMS AND CONDITIONS SET OUT HEREIN ARE FOR INFORMATION PURPOSES ONLY AND ARE DIRECTED ONLY AT: (A) PERSONS IN MEMBER STATES OF THE EUROPEAN ECONOMIC AREA WHO ARE QUALIFIED INVESTORS AS DEFINED IN SECTION 86(7) OF THE FINANCIAL SERVICES AND MARKETS ACT 2000, AS AMENDED, ("QUALIFIED INVESTORS") BEING PERSONS FALLING WITHIN THE MEANING OF ARTICLE 2(1)(E) OF THE EU PROSPECTUS DIRECTIVE (WHICH MEANS DIRECTIVE 2003/71/EC (AS AMENDED BY DIRECTIVE 2010/73/EC)) AND INCLUDES ANY RELEVANT IMPLEMENTING DIRECTIVE MEASURE IN ANY MEMBER STATE) (THE "PROSPECTUS DIRECTIVE"); (B) IN THE UNITED KINGDOM, QUALIFIED INVESTORS WHO ARE PERSONS WHO (I) HAVE PROFESSIONAL EXPERIENCE IN MATTERS RELATING TO INVESTMENTS FALLING WITHIN ARTICLE 19(1) OF THE FINANCIAL SERVICES AND MARKETS ACT 2000 (FINANCIAL PROMOTION) ORDER 2005 (THE "ORDER"); (II) ARE PERSONS FALLING WITHIN ARTICLE 49(2)(A) TO (D) ("HIGH NET WORTH COMPANIES, UNINCORPORATED ASSOCIATIONS, ETC") OF THE ORDER; AND (III) ARE PERSONS TO WHOM IT MAY OTHERWISE BE LAWFULLY COMMUNICATED (ALL SUCH PERSONS TOGETHER BEING REFERRED TO AS "RELEVANT PERSONS"). THIS APPENDIX AND THE TERMS AND CONDITIONS SET OUT HEREIN MUST NOT BE ACTED ON OR RELIED ON BY PERSONS WHO ARE NOT RELEVANT PERSONS. ANY INVESTMENT OR INVESTMENT ACTIVITY TO WHICH THIS APPENDIX AND THE TERMS AND CONDITIONS SET OUT HEREIN RELATES IS AVAILABLE ONLY TO RELEVANT PERSONS AND WILL BE ENGAGED IN ONLY WITH RELEVANT PERSONS. THIS APPENDIX DOES NOT ITSELF CONSTITUTE AN OFFER FOR SALE OR SUBSCRIPTION OF ANY SECURITIES IN THE COMPANY. THIS ANNOUNCEMENT IS NOT AN OFFER OF OR SOLICITATION TO PURCHASE OR SUBSCRIBE FOR SECURITIES IN THE UNITED STATES. THE SECURITIES REFERRED TO HEREIN HAVE NOT BEEN AND WILL NOT BE REGISTERED UNDER THE U.S. SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT") OR THE APPLICABLE SECURITIES LAWS OF ANY STATE OR OTHER JURISDICTION OF THE UNITED STATES, AND MAY NOT BE OFFERED OR SOLD IN THE UNITED STATES, EXCEPT PURSUANT TO AN APPLICABLE EXEMPTION FROM, OR AS PART OF A TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND THE APPLICABLE SECURITIES LAWS OF ANY STATE OR OTHER JURISDICTION IN THE UNITED STATES. NEITHER THE U.S. SECURITIES AND EXCHANGE COMMISSION NOR ANY SECURITIES REGULATORY AUTHORITY OF ANY STATE OR OTHER JURISDICTION OF THE UNITED STATES HAS APPROVED OR DISAPPROVED OF AN INVESTMENT IN THE SECURITIES OR PASSED UPON OR ENDORSED THE MERITS OF THE PLACING OR THE ACCURACY OR ADEQUACY OF THE CONTENTS OF THIS ANNOUNCEMENT. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE IN THE UNITED STATES. NO PUBLIC OFFERING OF SECURITIES IS BEING MADE IN THE UNITED STATES. NO MONEY, SECURITIES OR OTHER CONSIDERATION FROM ANY PERSON INSIDE THE UNITED STATES IS BEING SOLICITED BY THIS ANNOUNCEMENT AND, IF SENT IN RESPONSE TO THE INFORMATION CONTAINED IN THIS ANNOUNCEMENT, WILL NOT BE ACCEPTED.

EACH PLACEE SHOULD CONSULT WITH ITS OWN ADVISERS AS TO LEGAL, TAX, BUSINESS AND RELATED ASPECTS OF AN INVESTMENT IN PLACING SHARES.

Persons who are invited to and who choose to participate in the Placing, by making (or on whose behalf there is made) an oral or written offer to subscribe for Placing Shares (the "Placees"), will be deemed to have read and understood this Announcement, including this Appendix, in its entirety and to be making such offer on the terms and conditions, and to be providing the representations, warranties, acknowledgements, and undertakings contained in this Appendix. In particular, each such Placee represents, warrants and acknowledges that:

1 it is a Relevant Person (as defined above) and undertakes that it will acquire, hold, manage or dispose of any Placing Shares that are allocated to it for the purposes of its business;

2. in the case of any Placing Shares acquired by it as a financial intermediary, as that term is used in Article 3(2) of the Prospectus Directive, (a) the Placing Shares acquired by it in the Placing have not been acquired on behalf of, nor have they been acquired with a view to their offer or resale to, persons in any Member State of the European Economic Area which has implemented the Prospectus Directive other than Qualified Investors or in circumstances in which the prior consent of the Joint Bookrunners has been given to the offer or resale; or (b) where Placing Shares have been acquired by it on behalf of persons in any member state of the EEA other than Qualified Investors, the offer of those Placing Shares to it is not treated under the Prospectus Directive as having been made to such persons; and

3. (a) (i) it is not in the United States and (ii) it is not acting for the account or benefit of a person in the United States; (b) it is a dealer or other professional fiduciary in the United States acting on a discretionary basis for a non-US person (other than an estate or trust) in reliance on Regulation S under the Securities Act; (c) it is otherwise acquiring the Placing Shares in an "offshore transaction" meeting the requirements of Regulation S under the Securities Act; or (d) it is either (i) a "qualified institutional buyer" (a "QIB") (as defined in Rule 144A under the Securities Act) or (ii) an "accredited investor" (an "AI") (as defined in Rule 501 of Regulation D under the Securities Act) and, in each case under this sub clause (d), it has duly executed an investor letter in a form provided to it and delivered the same to one of the Joint Bookrunners or its affiliates.

The Company and the Joint Bookrunners will rely upon the truth and accuracy of the foregoing representations, acknowledgements and agreements.

This Announcement does not constitute an offer, and may not be used in connection with an offer, to sell or issue or the solicitation of an offer to buy or subscribe for Placing Shares in any jurisdiction in which such offer or solicitation is or may be unlawful. This Announcement and the information contained herein is not for publication or distribution, directly or indirectly, to persons in the United States, Australia, Canada, Japan or the Republic of South Africa or in any jurisdiction in which such publication or distribution is unlawful. Persons into whose possession this Announcement may come are required by the Company to inform themselves about and to observe any restrictions of transfer of this Announcement. No public offer of securities of the Company is being made in the United Kingdom, the United States or elsewhere.

In particular, the Placing Shares referred to in this Announcement have not been and will not be registered under the Securities Act or any laws of or with any securities regulatory authority of any state or other jurisdiction of the United States, and may not be offered, sold, pledged or otherwise transferred within the United States except pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act and the securities laws of any state or other jurisdiction of the United States. The Placing Shares are being offered and sold outside the United States in accordance with Regulation S. Any offering to be made in the United States will be made to a limited number of QIBs and/or AIs pursuant to an exemption from, or in a transaction not subject to, registration under the Securities Act or in a transaction not involving any public offering.

The Placing Shares have not been approved or disapproved by the US Securities and Exchange Commission, any state securities commission or other regulatory authority in the United States, nor have any of the foregoing authorities passed upon or endorsed the merits of the Placing or the accuracy or adequacy of this Announcement. Any representation to the contrary is a criminal offence in the United States.

The relevant clearances have not been, nor will they be, obtained from the securities commission of any province or territory of Canada; no prospectus has been lodged with or registered by the Australian Securities and Investments Commission or the Japanese Ministry of Finance; and the Placing Shares have not been, nor will they be, registered under or offered in compliance with the securities laws of any state, province or territory of Australia, Canada, Japan or the Republic of South Africa. Accordingly, the Placing Shares may not (unless an exemption under the relevant securities laws is applicable) be offered, sold, resold or delivered, directly or indirectly, in or into Australia, Canada, Japan or the Republic of South Africa or any other jurisdiction outside the United Kingdom.

Persons (including, without limitation, nominees and trustees) who have a contractual or other legal obligation to forward a copy of this Appendix or the Announcement of which it forms part should seek appropriate advice before taking any action.

In this Appendix, unless the context otherwise requires, "Placee" means a Relevant Person (including individuals, funds or others) on whose behalf a commitment to subscribe for Placing Shares has been given.

Details of the Placing Agreement and the Placing Shares

Barclays and Canaccord Genuity are acting as joint bookrunners in connection with the Placing and on 24 March 2014 entered into the Placing Agreement with the Company. Under the Placing Agreement the Joint Bookrunners have agreed to use their respective reasonable endeavours to procure placees to subscribe for the Placing Shares, on the terms and subject to the conditions set out therein.

If following completion of the Bookbuild any Placee defaults in paying the Placing Price in respect of any Placing Shares allotted to it, the Joint Bookrunners have severally (and not jointly or jointly and severally) agreed to subscribe for such shares, and the Company has agreed to allot and issue such shares to the Joint Bookrunners, at the Placing Price, on and subject to the terms set out in the Placing Agreement.

Each of the Joint Bookrunners has further severally (and not jointly or jointly and severally) agreed with the Company to underwrite the Placing at a certain price (the "Floor Price") and to subscribe on the date of Admission for such Placing Shares at the Floor Price as the Joint Bookrunners have been unable to procure Placees for at or above the Floor Price in the agreed proportions set out in the Placing Agreement.

The Placing Shares, when issued, will be credited as fully paid and will be issued subject to the Company's Memorandum and Articles of Association and will rank pari passu in all respects with the existing Ordinary Shares, including the right to receive all dividends and other distributions declared, made or paid on or in respect of the Ordinary Shares after the date of issue of the Placing Shares.

The Company confirms that, save for (i) the Placing Shares; (ii) the Ordinary Shares to be issued pursuant to the exercise of outstanding warrants and awards granted under the Company's share option schemes and (iii) any Ordinary Shares which the Company is, at the date of this Announcement, contractually obliged to issue, it has no current intention to issue further Ordinary Shares for cash consideration without first seeking new shareholder authorities and approvals to do so.

Application for admission to trading

Application will be made to London Stock Exchange plc (the "London Stock Exchange") for admission of the Placing Shares to trading on AIM ("Admission"). It is expected that Admission will become effective at 8.00 am on 28 March 2014, and that dealings in the Placing Shares will commence at that time.

Bookbuild

The Joint Bookrunners will today commence an accelerated bookbuilding process in respect to the Placing (the "Bookbuild") to determine demand for participation in the Placing by Placees. This Appendix gives details of the terms and conditions of, and the mechanics of participation in, the Placing. No commissions will be paid to Placees or by Placees in respect of any Placing Shares.

The Joint Bookrunners and the Company shall be entitled to effect the Placing by such alternative method to the Bookbuild as they may, in their sole discretion, determine.

Participation in, and principal terms of, the Placing

1. The Joint Bookrunners are arranging the Placing severally, and not jointly or jointly and severally, as joint bookrunners and agents of the Company.

2. Participation in the Placing will only be available to persons who may lawfully be, and are, invited to participate by the Joint Bookrunners. The Joint Bookrunners and their respective affiliates are entitled to enter bids in the Bookbuild as principal.

3. The Bookbuild, if successful, will establish the Placing Price which will be the single price payable in respect of the Placing Shares to the Joint Bookrunners by all Placees whose bids are successful. The Placing Price will be agreed between the Bookrunners and the Company following completion of the Bookbuild. The Placing Price and the results of the Placing will be announced on a Regulatory Information Service following completion of the Bookbuild.

4. To bid in the Bookbuild, Placees should communicate their bid by telephone to their usual sales contact at one of the Joint Bookrunners. Each bid should state the number of Placing Shares which the prospective Placee wishes to subscribe for at the Placing Price which is ultimately established by the Company and the Joint Bookrunners, or at prices up to a price limit specified in its bid. Bids may be scaled down by the Joint Bookrunners on the basis referred to paragraph 7 below.

5. The Bookbuild is expected to close no later than 4.30 pm on 25 March 2014 but may be closed earlier or later at the discretion of the Joint Bookrunners. The Joint Bookrunners may, in agreement with the Company, accept bids that are received after the Bookbuild has closed. The Company reserves the right to reduce or seek to increase the amount to be raised pursuant to the Placing, in its absolute discretion.

6. Each Placee's allocation will be confirmed to Placees orally, or by email, by the Joint Bookrunners (or either of them) following the close of the Bookbuild and a trade confirmation or contract note will be dispatched as soon as possible thereafter. A Joint Bookrunner's oral or emailed confirmation to such Placee will constitute an irrevocable legally binding commitment upon such person (who will at that point become a Placee) in favour of the Joint Bookrunners and the Company, under which it agrees to subscribe for the number of Placing Shares allocated to it at the relevant Placing Price on the terms and conditions set out in this Appendix (which are deemed to be incorporated in such trade confirmation or contract note) and in accordance with the Company's Articles of Association.

7. Subject to paragraphs 4 and 5 above, the Joint Bookrunners may choose to accept bids, either in whole or in part, on the basis of allocations determined at their discretion (in agreement with the Company) and may scale down any bids for this purpose on such basis as it may determine. The Joint Bookrunners may also, notwithstanding paragraphs 4 and 5 above, subject to the prior consent of the Company (a) allocate Placing Shares after the time of any initial allocation to any person submitting a bid after that time and (b) allocate Placing Shares after the Bookbuild has closed to any person submitting a bid after that time.

8. A bid in the Bookbuild will be made on the terms and subject to the conditions in this appendix and will be legally binding on the Placee on behalf of which it is made and, except with a Joint Bookrunner's consent, will not be capable of variation or revocation after the time at which it is submitted. Each Placee will also have an immediate, separate, irrevocable and binding obligation, owed to the Joint Bookrunners and the Company, to pay the relevant Joint Bookrunner (or as such Joint Bookrunner may direct) in cleared funds an amount equal to the product of the Placing Price and the number of Placing Shares for which such Placee has agreed to subscribe. Each Placee's obligations will be owed to the Joint Bookrunners and the Company.

9. Except as required by law or regulation, no press release or other announcement will be made by the Joint Bookrunners or the Company using the name of any Placee (or its agent), in its capacity as Placee (or agent), other than with such Placee's prior written consent.

10. Irrespective of the time at which a Placee's allocation pursuant to the Placing is confirmed, settlement for all Placing Shares to be acquired pursuant to the Placing will be required to be made at the same time, on the basis explained below under "Registration and Settlement".

11. All obligations under the Bookbuild and Placing will be subject to fulfilment of the conditions referred to below under "Conditions of the Placing" and to the Placing not being terminated on the basis referred to below under "Right to terminate under the Placing Agreement".

12. By participating in the Bookbuild, each Placee agrees that its rights and obligations in respect of the Placing will terminate only in the circumstances described below and will not be capable of rescission or termination by the Placee.

13. To the fullest extent permissible by law and the applicable rules of the Financial Conduct Authority ("FCA"), neither the Joint Bookrunners nor any of their respective affiliates, agents, directors, officers or employees shall have any liability to Placees (or to any other person whether acting on behalf of a Placee or otherwise whether or not a recipient of these terms and conditions) in respect of the Placing. Each Placee acknowledges and agrees that the Company is responsible for the allotment of the Placing Shares to the Placees and the Joint Bookrunners shall have no liability to the Placees for the failure of the Company to fulfil those obligations. In particular, neither the Joint Bookrunners nor any of their respective affiliates, agents, directors, officers or employees shall have any liability (including to the extent permissible by law, any fiduciary duties) in respect of the Joint Bookrunners' conduct of the Bookbuild or of such alternative method of effecting the Placing as the Joint Bookrunners and the Company may agree.

Conditions of the Placing

The Joint Bookrunners' obligations under the Placing Agreement in respect of the Placing Shares are conditional on, inter alia:

(a) none of the warranties contained in the Placing Agreement being untrue or inaccurate in any material respect or materially misleading in the context of the Placing (in the good faith opinion of either Joint Bookrunner) as at the date of the Placing Agreement and up to and as at the date of Admission as though they had been given and made on such dates (by reference to the facts and circumstances existing at such dates);

(b) the Company allotting, subject only to Admission, the Placing Shares in accordance with the Placing Agreement;

(c) Admission becoming effective by 8.00 am on 28 March 2014 or such later time and/or date as the Company and the Joint Bookrunners may otherwise agree (but not being later than 8.00 am on 4 April 2014); and

(d) in the good faith opinion of the Joint Bookrunners there have been since the date of the Placing Agreement no material adverse effect (as defined in the Placing Agreement), whether or not foreseeable at the date of the Placing Agreement.

If (i) any of the conditions contained in the Placing Agreement in relation to the Placing Shares are not fulfilled or waived by the Joint Bookrunners by the respective time or date where specified (or such later time or date as the Company and the Joint Bookrunners may agree), (ii) any of such conditions becomes incapable of being fulfilled or (iii) the Placing Agreement is terminated in the circumstances specified below, the Placing in relation to the Placing Shares will lapse and the Placee's rights and obligations hereunder in relation to the Placing Shares shall cease and terminate at such time and each Placee agrees that no claim can be made by the Placee in respect thereof.

The Joint Bookrunners may, at their discretion and upon such terms as they think fit, waive, or extend the period for, compliance by the Company with the whole or any part of any of the Company's obligations in relation to the conditions in the Placing Agreement, save that the above conditions relating to the Company allotting the Placing Shares and Admission becoming effective (as well as certain other conditions contained in the Placing Agreement) may not be waived. Any such extension or waiver will not affect Placees' commitments as set out in this Announcement.

Neither the Joint Bookrunners nor the Company shall have any liability to any Placee (or to any other person whether acting on behalf of a Placee or otherwise) in respect of any decision they may make as to whether or not to waive or to extend the time and/or date for the satisfaction of any condition to the Placing nor for any decision they may make as to the satisfaction of any condition or in respect of the Placing generally and by participating in the Placing each Placee agrees that any such decision is within the absolute discretion of the Joint Bookrunners.

Right to terminate under the Placing Agreement

Each of the Joint Bookrunners is entitled, at any time before Admission, to terminate the Placing Agreement by giving notice to the Company in certain circumstances, including, inter alia, if any of the warranties given to the Joint Bookrunners in the Placing Agreement becomes untrue or inaccurate in any material respect or, in the good faith opinion of either Joint Bookrunner, materially misleading in the context of the Placing, or if the Company is in material breach of its obligations under the Placing Agreement, or if a force majeure event has occurred. Following Admission, the Placing Agreement is not capable of termination to the extent that it relates to the Placing of the Placing Shares.

The rights and obligations of the Placees shall terminate only in the circumstances described in these terms and conditions and will not be subject to termination by the Placee or any prospective Placee at any time or in any circumstances. By participating in the Placing, each Placee agrees that the exercise by a Joint Bookrunner of any right of termination or other discretion under the Placing Agreement shall be within the absolute discretion of that Joint Bookrunner, and that it need not make any reference to Placees and that it shall have no liability to Placees whatsoever in connection with any such exercise.

No Admission Document or Prospectus

The Placing Shares are being offered to a limited number of specifically invited persons only and will not be offered in such a way as to require an admission document or prospectus in the United Kingdom or in any other jurisdiction. No offering document, admission document or prospectus has been or will be submitted to be approved by the FCA in relation to the Placing, and Placees' commitments will be made solely on the basis of the information contained in the Announcement (including this Appendix) and the Exchange Information (as defined further below). Each Placee, by accepting a participation in the Placing, agrees that the content of this Announcement is exclusively the responsibility of the Company and confirms that it has neither received nor relied on any other information (other than the Exchange Information), representation, warranty, or statement made by or on behalf of the Company or the Joint Bookrunners or any other person and neither the Joint Bookrunners nor the Company nor any other person will be liable for any Placee's decision to participate in the Placing based on any other information, representation, warranty or statement which the Placees may have obtained or received and, if given or made, such information, representation, warranty or statement must not be relied upon as having been authorised by the Bookrunners, the Company, or their respective officers, directors, employees or agents. Each Placee acknowledges and agrees that it has relied on its own investigation of the business, financial or other position of the Company in accepting a participation in the Placing. Neither the Company nor the Joint Bookrunners are making any undertaking or warranty to any Placee regarding the legality of an investment in the Placing Shares by such Placee under any legal, investment or similar laws or regulations. Each Placee should not consider any information in this Announcement to be legal, tax or business advice. Each Placee should consult its own solicitor, tax adviser and financial adviser for independent legal, tax and financial advice regarding an investment in the Placing Shares. Nothing in this paragraph shall exclude the liability of any person for fraud or fraudulent misrepresentation.

Registration and Settlement

Settlement of transactions in the Placing Shares (ISIN: GB00B1YMRB82; SEDOL: B1YMRB8) following Admission will take place within the system administered by Euroclear UK & Ireland Limited ("CREST") provided that, subject to certain exceptions, the Joint Bookrunners reserve the right to require settlement for, and delivery of, the Placing Shares (or a portion thereof) to Placees by such other means that they deems necessary if delivery or settlement is not possible or practicable within CREST within the timetable set out in this Announcement or would not be consistent with the regulatory requirements in any Placee's jurisdiction.

Following the close of the Bookbuild, each Placee allocated Placing Shares in the Placing will be sent a trade confirmation or contract note in accordance with the standing arrangements in place with the relevant Joint Bookrunner, stating the number of Placing Shares allocated to it at the Placing Price, the aggregate amount owed by such Placee to the relevant Joint Bookrunner and settlement instructions. Each Placee agrees that it will do all things necessary to ensure that delivery and payment is completed in accordance with either the standing CREST or certificated settlement instructions that it has in place with the relevant Joint Bookrunner.

It is expected that settlement of the Placing Shares will be on 28 March 2014 on a T+3 basis in accordance with the instructions set out in the trade confirmation.

Interest is chargeable daily on payments not received from Placees on the due date in accordance with the arrangements set out above at the rate of two percentage points above LIBOR as determined by Joint Bookrunners.

Each Placee is deemed to agree that, if it does not comply with these obligations, the Joint Bookrunners may sell any or all of the Placing Shares allocated to that Placee on such Placee's behalf and retain from the proceeds, for the Joint Bookrunners' account and benefit (as agent for the Company), an amount equal to the aggregate amount owed by the Placee plus any interest due. The relevant Placee will, however, remain liable for any shortfall below the aggregate amount owed by it and may be required to bear any stamp duty or stamp duty reserve tax or securities transfer tax (together with any interest or penalties) which may arise upon the sale of such Placing Shares on such Placee's behalf. By communicating a bid for Placing Shares, each Placee confers on the Joint Bookrunners all such authorities and powers necessary to carry out any such sale and agrees to ratify and confirm all actions which the Joint Bookrunners lawfully take in pursuance of such sale.

If Placing Shares are to be delivered to a custodian or settlement agent, Placees should ensure that the trade confirmation or contract note is copied and delivered immediately to the relevant person within that organisation.

Insofar as Placing Shares are registered in a Placee's name or that of its nominee or in the name of any person for whom a Placee is contracting as agent or that of a nominee for such person, such Placing Shares should, subject as provided below, be so registered free from any liability to UK stamp duty or stamp duty reserve tax or securities transfer tax. Placees will not be entitled to receive any fee or commission in connection with the Placing.

Representations, Warranties and Further Terms

By participating in the Placing each Placee (and any person acting on such Placee's behalf) makes the following representations, warranties, acknowledgements, agreements and undertakings (as the case may be) to the Company and the Joint Bookrunners:

1. represents and warrants that it has read and understood this Announcement, including the Appendix, in its entirety and that its subscription of Placing Shares is subject to and based upon all the terms, conditions, representations, warranties, acknowledgements, agreements and undertakings and other information contained herein and undertakes not to redistribute or duplicate this Announcement;

2. acknowledges that no offering document, admission document or prospectus has been prepared in connection with the Placing and represents and warrants that it has not received and will not receive a prospectus, admission document or other offering document in connection therewith;

3. acknowledges that the Ordinary Shares are admitted to trading on AIM, and the Company is therefore required to publish certain business and financial information in accordance with the AIM Rules for Companies (collectively "Exchange Information"), which includes a description of the nature of the Company's business and the Company's most recent balance sheet and profit and loss account and the Company's announcements and circulars published in the past 12 months and that it is able to obtain or access such information without undue difficulty;

4. acknowledges that neither of the Joint Bookrunners, nor the Company, nor any of their respective affiliates nor any person acting on behalf of any of them has provided, and will not provide it, with any material regarding the Placing Shares or the Company other than this Announcement; nor has it requested any Joint Bookrunner, the Company, any of their respective affiliates or any person acting on behalf of any of them to provide it with any such information;

5. acknowledges that the content of this Announcement is exclusively the responsibility of the Company, and that neither Joint Bookrunner, nor their respective affiliates nor any person acting on its or their behalf has or shall have any liability for any information, representation or statement contained in this Announcement or any information previously or concurrently published by or on behalf of the Company, and will not be liable for any Placee's decision to participate in the Placing based on any information, representation or statement contained in this Announcement or otherwise. Each Placee further represents, warrants and agrees that the only information on which it is entitled to rely and on which such Placee has relied in committing itself to acquire the Placing Shares is contained in this Announcement and any Exchange Information, such information being all that it deems necessary to make an investment decision in respect of the Placing Shares and that it has neither received nor relied on any other information given or representations, warranties or statements made by any of the Joint Bookrunners or the Company, or, if received, it has not relied upon any such information, representations, warranties or statements (including any management presentation that may have been received by any prospective Placee) and neither the Joint Bookrunners nor the Company will be liable for any Placee's decision to accept an invitation to participate in the Placing based on any other information, representation, warranty or statement. Each Placee further acknowledges and agrees that it has relied solely on its own investigation of the business, financial or other position of the Company in deciding to participate in the Placing and it will not rely on any investigation that the Joint Bookrunners, their respective affiliates or any other person acting on its or their behalf has or may have conducted;

6. represents and warrants that it has neither received nor relied on any confidential price sensitive information concerning the Company in accepting this invitation to participate in the Placing;

7. acknowledges that neither Joint Bookrunner, nor any person acting on behalf of it or them, nor any of their respective affiliates has or shall have any liability for the Exchange Information, any publicly available or filed information or any representation relating to the Company, provided that nothing in this paragraph excludes the liability of any person for fraud or fraudulent misrepresentation made by that person;

8. if the Placing Shares were offered to it in the United States, represents and warrants that in making its investment decision, (a) it has consulted its own independent advisers or otherwise has satisfied itself concerning, without limitation, the effects of United States federal, state and local income tax laws and foreign tax laws generally and the US Employee Retirement Income Security Act of 1974, as amended ("ERISA"), the US Investment Company Act of 1940 and the Securities Act, (b) it has received all information (including the business, financial condition, prospects, creditworthiness, status and affairs of the Company, the Placing and the Placing Shares, as well as the opportunity to ask questions) concerning the Company, the Placing and the Placing Shares that it believes is necessary or appropriate in order to make an investment decision in respect of the Company and the Placing Shares, (c) it is aware and understands that an investment in the Placing Shares involves a considerable degree of risk and no US federal or state or non-US agency has made any finding or determination as to the fairness for investment or any recommendation or endorsement of the Placing Shares, and (d) it is able to bear the economic risk of an investment in the Placing Shares, is able to sustain a complete loss of the investment in the Placing Shares and has no need for liquidity with respect to its investment in the Placing Shares;

9. represents and warrants that (a) (i) it is not in the United States; (ii) is not a U.S. person (as defined in Regulation S under the Securities Act); and (iii) it is not acting for the account or benefit of a U.S person (as defined in Regulation S under the Securities Act) or a person in the United States; (b) it is a dealer or other professional fiduciary in the United States acting on a discretionary basis for a non-US person (other than an estate or trust) in reliance on Regulation S under the Securities Act; (c) it is otherwise acquiring the Placing Shares in an "offshore transaction" meeting the requirements of Regulation S under the Securities Act; or (d) it is either (i) a "qualified institutional buyer" (a "QIB") (as defined in Rule 144A under the Securities Act) or (ii) an "accredited investor" (an "AI") (as defined in Rule 501 of Regulation D under the Securities Act) and, in each case under this sub clause (d) it has duly executed an investor letter in a form provided to it and delivered the same to one of the Joint Bookrunners or its affiliates;

10. acknowledges that it is acquiring the Placing Shares for its own account or for one or more accounts as to each of which it exercises sole investment discretion and each of which (if in the United States) is a QIB, for investment purposes and not with a view to any distribution or for resale in connection with, the distribution thereof in whole or in part, in the United States and that it has full power to make the acknowledgements, representations and agreements herein on behalf of each such account;

11. acknowledges that the Placing Shares have not been and will not be registered under the Securities Act or with any state or other jurisdiction of the United States, nor approved or disapproved by the US Securities and Exchange Commission, any state securities commission in the United States or any other United States regulatory authority, and agrees not to reoffer, resell, pledge or otherwise transfer the Placing Shares except pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act;

12. acknowledges that the Placing Shares offered and sold in the United States are "restricted securities" within the meaning of Rule 144(a)(3) under the Securities Act and, so long as the Placing Shares are "restricted securities", it will not deposit the Placing Shares into any unrestricted depositary receipt facility maintained by any depositary bank in respect of the Company's Ordinary Shares and understands that the Placing Shares will not settle or trade through the facilities of the Depository Trust Corporation, the NYSE, NASDAQ or any other US exchange or clearing system;

13. represents and warrants that it will not reoffer, sell, pledge or otherwise transfer the Placing Shares except (a) in an offshore transaction in accordance with Regulation S under the Securities Act; (b) pursuant to an effective registration statement under the Securities Act; or (c) pursuant to any other available exemption from the registration requirements of the Securities Act and that, in each such case, such offer, sale, pledge, or transfer will be made in accordance with any applicable securities laws of any state of the United States;

14. represents and warrants that it is not a "benefit plan investor" (within the meaning of ERISA), or other employee benefit plan subject to any US federal, state, local or other law or regulation that is substantially similar to the prohibited transaction provisions of Section 406 of ERISA or Section 4975 of the US Internal Revenue Code of 1986, as amended, and that it will not sell or otherwise transfer any Placing Shares or any interest therein unless the transferee makes or is deemed to make the representations and warranties set forth in this paragraph (14), and the purchaser acknowledges and agrees that any purported transfer of Placing Shares or any interest therein that does not comply with this paragraph (14) will not be effective and will not be recognised by the Company;

15. acknowledges and agrees that the Placing Shares will, to the extent they are delivered in certificated form, bear a legend to the following effect unless agreed otherwise with the Company:

"THE SHARES REPRESENTED HEREBY HAVE NOT BEEN AND WILL NOT BE REGISTERED UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), OR WITH ANY SECURITIES REGULATORY AUTHORITY OF ANY STATE OR OTHER JURISDICTION OF THE UNITED STATES, AND MAY NOT BE OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED EXCEPT (A) PURSUANT TO A REGISTRATION STATEMENT WHICH HAS BEEN DECLARED EFFECTIVE UNDER THE SECURITIES ACT, (B) IN AN OFFSHORE TRANSACTION IN ACCORDANCE WITH RULE 903 OR RULE 904 OF REGULATION S UNDER THE SECURITIES ACT OR (C) PURSUANT TO ANY OTHER AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND IN ACCORDANCE WITH ANY APPLICABLE SECURITIES LAWS OF ANY STATE OR OTHER JURISDICTION OF THE UNITED STATES. EACH HOLDER, BY ITS ACCEPTANCE OF THESE SHARES, REPRESENTS THAT IT UNDERSTANDS AND AGREES TO THE FOREGOING RESTRICTIONS.";

16. unless otherwise specifically agreed in writing with the Joint Bookrunners, represents and warrants that neither it nor the beneficial owner of such Placing Shares will be a resident of Australia, Canada, Japan or the Republic of South Africa;

17. acknowledges that the Placing Shares have not been and will not be registered under the securities legislation of Australia, Canada, Japan or the Republic of South Africa and, subject to certain exceptions, may not be offered, sold, taken up, renounced or delivered or transferred, directly or indirectly, within those jurisdictions;

18. represents and warrants that the issue to it, or the person specified by it for registration as holder, of Placing Shares will not give rise to a liability under any of sections 67, 70, 93 or 96 of the Finance Act 1986 (depositary receipts and clearance services) and that the Placing Shares are not being acquired in connection with arrangements to issue depositary receipts or to transfer Placing Shares into a clearance system;

19. represents and warrants that: (a) it has complied with its obligations in connection with money laundering and terrorist financing under the Proceeds of Crime Act 2002, the Terrorism Act 2000 (as amended), the Terrorism Act 2006 and the Money Laundering Regulations 2007 and (b) it is not a person: (i) with whom transactions are prohibited under the Foreign Corrupt Practices Act of 1977 or any economic sanction programmes administered by, or regulations promulgated by, the Office of Foreign Assets Control of the U.S. Department of the Treasury; (ii) named on the Consolidated List of Financial Sanctions Targets maintained by HM Treasury of the United Kingdom; or (iii) subject to financial sanctions imposed pursuant to a regulation of the European Union or a regulation adopted by the United Nations (together, the "Regulations"); and, if making payment on behalf of a third party, that satisfactory evidence has been obtained and recorded by it to verify the identity of the third party as required by the Regulations and, if making payment on behalf of a third party, that satisfactory evidence has been obtained and recorded by it to verify the identity of the third party as required by the Regulations and has obtained all governmental and other consents (if any) which may be required for the purpose of, or as a consequence of, such purchase, and it will provide promptly to the Joint Bookrunners such evidence, if any, as to the identity or location or legal status of any person which any Joint Bookrunner may request from it in connection with the Placing (for the purpose of complying with such Regulations or ascertaining the nationality of any person or the jurisdiction(s) to which any person is subject or otherwise) in the form and manner requested by the Joint Bookrunners on the basis that any failure by it to do so may result in the number of Placing Shares that are to be acquired by it or at its direction pursuant to the Placing being reduced to such number, or to nil, as the Joint Bookrunners may decide at their sole discretion;

20. if a financial intermediary, as that term is used in Article 3(2) of the Prospectus Directive, represents and warrants that the Placing Shares purchased by it in the Placing will not be acquired on a non- discretionary basis on behalf of, nor will they be acquired with a view to their offer or resale to, persons in a Member State of the European Economic Area which has implemented the Prospectus Directive other than Qualified Investors, or in circumstances in which the prior consent of the Joint Bookrunners has been given to the offer or resale;

21. represents and warrants that it has not offered or sold and will not offer or sell any Placing Shares to persons in the United Kingdom, except to persons whose ordinary activities involve them in acquiring, holding, managing or disposing of investments (as principal or agent) for the purposes of their business or otherwise in circumstances which have not resulted and which will not result in an offer to the public in the United Kingdom within the meaning of section 85(1) of the Financial Services and Markets Act 2000, as amended ("FSMA");

22. represents and warrants that it has not offered or sold and will not offer or sell any Placing Shares to persons in the European Economic Area, except to persons whose ordinary activities involve them in acquiring, holding, managing or disposing of investments (as principal or agent) for the purposes of their business or otherwise in circumstances which have not resulted in and which will not result in an offer to the public in any member state of the European Economic Area within the meaning of the Prospectus Directive (including any relevant implementing measure in any member state);

23. represents and warrants that it has only communicated or caused to be communicated and will only communicate or cause to be communicated any invitation or inducement to engage in investment activity (within the meaning of section 21 of the FSMA) relating to the Placing and the Placing Shares in circumstances in which section 21(1) of the FSMA does not require approval of the communication by an authorised person;

24. represents and warrants that it has complied and will comply with all applicable provisions of the FSMA with respect to anything done by it in relation to the Placing Shares in, from or otherwise involving, the United Kingdom;

25. if in a Member State of the European Economic Area, unless otherwise specifically agreed with the Joint Bookrunners in writing, represents and warrants that it is a Qualified Investor within the meaning of the Prospectus Directive;

26. if in the United Kingdom, represents and warrants that it is a person (a) who has professional experience in matters relating to investments falling within Article 19(1) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 (the "Order"); (b) falling within Article 49(2)(A) to (D) ("High Net Worth Companies, Unincorporated Associations, etc.") of the Order; or (c) to whom this Announcement may otherwise be lawfully communicated;

27. represents and warrants that it and any person acting on its behalf is entitled to acquire the Placing Shares under the laws of all relevant jurisdictions and that it has all necessary capacity and has obtained all necessary consents and authorities and taken any other necessary actions to enable it to commit to this participation in the Placing and to perform its obligations in relation thereto (including, without limitation, in the case of any person on whose behalf it is acting, all necessary consents and authorities to agree to the terms set out or referred to in this Announcement) and will honour such obligations;

28. where it is acquiring Placing Shares for one or more managed accounts, represents and warrants that it is authorised in writing by each managed account: (a) to acquire the Placing Shares for each managed account; (b) to make on its behalf the representations, warranties, acknowledgements, undertakings and agreements in this Appendix and the Announcement of which it forms part; and (c) to execute and deliver on its behalf any investor letter relating to the Placing in the form provided to it by either of the Joint Bookrunners or its affiliates;

29. undertakes that it (and any person acting on its behalf) will make payment for the Placing Shares allocated to it in accordance with this Announcement on the due time and date set out herein, failing which the relevant Placing Shares may be placed with other subscribers or sold as the Joint Bookrunners may in their sole discretion determine and without liability to such Placee and it will remain liable for any shortfall below the net proceeds of such sale and the placing proceeds of such Placing Shares and may be required to bear the liability for any stamp duty or stamp duty reserve tax or security transfer tax (together with any interest or penalties due pursuant to or referred to in these terms and conditions) which may arise upon the placing or sale of such Placee's Placing Shares on its behalf;

30. acknowledges that neither Joint Bookrunner, nor any of their respective affiliates, nor any person acting on behalf of any of them, is making any recommendations to it, advising it regarding the suitability of any transactions it may enter into in connection with the Placing and that participation in the Placing is on the basis that it is not and will not be treated for these purposes as a client of either Joint Bookrunner and that neither Joint Bookrunner has any duties or responsibilities to it for providing the protections afforded to its respective clients or customers or for providing advice in relation to the Placing or in respect of any representations, warranties, undertakings or indemnities contained in the Placing Agreement or for the exercise or performance of any of their rights and obligations thereunder including any rights to waive or vary any conditions or exercise any termination right;

31. undertakes that the person whom it specifies for registration as holder of the Placing Shares will be (i) itself or (ii) its nominee, as the case may be. Neither the Joint Bookrunners nor the Company will be responsible for any liability to stamp duty or stamp duty reserve tax resulting from a failure to observe this requirement. Each Placee and any person acting on behalf of such Placee agrees to participate in the Placing and it agrees to indemnify the Company and the Joint Bookrunners in respect of the same on the basis that the Placing Shares will be allotted to the CREST stock account of a Joint Bookrunner who will hold them as nominee on behalf of such Placee until settlement in accordance with its standing settlement instructions;

32. acknowledges that these terms and conditions and any agreements entered into by it pursuant to these terms and conditions shall be governed by and construed in accordance with the laws of England and Wales and it submits (on behalf of itself and on behalf of any person on whose behalf it is acting) to the exclusive jurisdiction of the English courts as regards any claim, dispute or matter arising out of any such contract, except that enforcement proceedings in respect of the obligation to make payment for the Placing Shares (together with any interest chargeable thereon) may be taken by the Company or the Joint Bookrunners in any jurisdiction in which the relevant Placee is incorporated or in which any of its securities have a quotation on a recognised stock exchange;

33. acknowledges that time shall be of the essence as regards to obligations pursuant to this Appendix to the Announcement;

34. agrees that the Company, the Joint Bookrunners and their respective affiliates and others will rely upon the truth and accuracy of the foregoing representations, warranties, acknowledgements and undertakings which are given to the Company and to each of the Joint Bookrunners on its own behalf and on behalf of the Company and are irrevocable and are irrevocably authorised to produce this Announcement or a copy thereof to any interested party in any administrative or legal proceeding or official inquiry with respect to the matters covered hereby;

35. agrees to indemnify on an after-tax basis and hold the Company, the Joint Bookrunners and their respective affiliates and any person acting on behalf of any of them harmless from any and all costs, claims, liabilities and expenses (including legal fees and expenses) arising out of or in connection with any breach of the representations, warranties, acknowledgements, agreements and undertakings in this Appendix and further agrees that the provisions of this Appendix shall survive after completion of the Placing;

36. acknowledges that no action has been or will be taken by any of the Company, the Joint Bookrunners or any person acting on behalf of the Company or the Joint Bookrunners that would, or is intended to, permit a public offer of the Placing Shares in any country or jurisdiction where any such action for that purpose is required;

37. acknowledges that it is an institution that has knowledge and experience in financial, business and international investment matters as is required to evaluate the merits and risks of subscribing for the Placing Shares. It further acknowledges that it is experienced in investing in securities of this nature and is aware that it may be required to bear, and it, and any accounts for which it may be acting, are able to bear, the economic risk of, and is able to sustain, a complete loss in connection with the Placing. It has relied upon its own examination and due diligence of the Company and its associates taken as a whole, and the terms of the Placing, including the merits and risks involved; and

38. acknowledges that its commitment to subscribe for Placing Shares on the terms set out herein and in the trade confirmation or contract note will continue notwithstanding any amendment that may in future be made to the terms of the Placing and that Placees will have no right to be consulted or require that their consent be obtained with respect to the Company's conduct of the Placing.

The representations, warranties, acknowledgments and undertakings contained in this Appendix are given to each of the Joint Bookrunners for itself and on behalf of the Company and to the Company and are irrevocable.

The agreement to settle a Placee's subscription (and/or the subscription of a person for whom such Placee is contracting as agent) free of stamp duty and stamp duty reserve tax depends on the settlement relating only to a subscription by it and/or such person direct from the Company for the Placing Shares in question. Such agreement assumes that the Placing Shares are not being subscribed for in connection with arrangements to issue depositary receipts or to transfer the Placing Shares into a clearance service. If there are any such arrangements, or the settlement relates to any other subsequent dealing in the Placing Shares, stamp duty or stamp duty reserve tax may be payable, for which neither the Company nor the Joint Bookrunners will be responsible, and the Placee to whom (or on behalf of whom, or in respect of the person for whom it is participating in the Placing as an agent or nominee) the allocation, allotment, issue or delivery of Placing Shares has given rise to such UK stamp duty or stamp duty reserve tax undertakes to pay such UK stamp duty or stamp duty reserve tax forthwith and to indemnify on an after-tax basis and to hold harmless the Company and the Joint Bookrunners in the event that any of the Company and/or the Joint Bookrunners has incurred any such liability to UK stamp duty or stamp duty reserve tax. If this is the case, each Placee should seek its own advice and notify the Joint Bookrunners accordingly.

In addition, Placees should note that they will be liable for any stamp duty and all other stamp, issue, securities, transfer, registration, documentary or other duties or taxes (including any interest, fines or penalties relating thereto) payable outside the UK by them or any other person on the subscription by them of any Placing Shares or the agreement by them to subscribe for any Placing Shares.

Each Placee, and any person acting on behalf of the Placee, acknowledges that the Joint Bookrunners do not owe any fiduciary or other duties to any Placee in respect of any representations, warranties, undertakings or indemnities in the Placing Agreement.

Each Placee and any person acting on behalf of the Placee acknowledges and agrees that the Joint Bookrunners or any of their respective affiliates may, at their absolute discretion, agree to become a Placee in respect of some or all of the Placing Shares.

When a Placee or person acting on behalf of the Placee is dealing with the Joint Bookrunners, any money held in an account with a Joint Bookrunner on behalf of the Placee and/or any person acting on behalf of the Placee will not be treated as client money within the meaning of the rules and regulations of the FCA made under the FSMA. The Placee acknowledges that the money will not be subject to the protections conferred by the client money rules; as a consequence, this money will not be segregated from the Joint Bookrunners' money in accordance with the client money rules and will be used by the Joint Bookrunners in the course of their own business and the Placee will rank only as a general creditor of each of the Joint Bookrunners.

All times and dates in this Announcement may be subject to amendment. The Joint Bookrunners shall notify the Placees and any person acting on behalf of the Placees of any changes.