Parkmead Regulatory News (PMG)

THE INFORMATION CONTAINED HEREIN IS RESTRICTED AND IS NOT FOR PUBLICATION, RELEASE OR DISTRIBUTION, DIRECTLY OR INDIRECTLY, IN OR INTO THE UNITED STATES, CANADA, AUSTRALIA, JAPAN, THE REPUBLIC OF SOUTH AFRICA, NEW ZEALAND, OR THE REPUBLIC OF IRELAND OR ANY JURISDICTION IN WHICH SUCH PUBLICATION RELEASE OR DISTRIBUTION WOULD BE UNLAWFUL.

8 March 2012

The Parkmead Group plc

("Parkmead", "the Company" or "the Group")

Placing of 60,960,182 new Ordinary Shares to raise £8.53 million

Related Party Transaction

Parkmead, the independent oil and gas company, is pleased to have announced earlier today that it has signed an agreement with Dyas B.V. to acquire a portfolio of Netherlands onshore assets (the "Assets") for a total consideration of €7.5 million ( the "Acquisition") comprising interests in four producing gas fields and two oil fields. The Acquisition is subject to the usual partner and regulatory approvals and marks a significant milestone for the Group, adding the first producing assets to the Parkmead portfolio.

In addition, the Company is now pleased to announce that is has raised approximately £8.53m (gross) through a placing of 60,960,182 new Ordinary Shares (the "Placing Shares") at 14 pence per share. The Placing Shares have been placed with certain institutional and other investors (the "Placing").

The proceeds of the Placing, when added to the existing resource available to the Company, will be used to finance the capital commitments of the Company. These include:

§ The initial consideration payable pursuant to the Acquisition;

§ Associated development costs (including infill drilling) relating to the Assets being acquired;

§ Exploration and appraisal costs in the Platypus/Possum and Pharos areas (including Platypus drilling which is expected to commence in the next month);

§ The geotechnical work associated with applications being made in the UKCS 27th Licensing Round; and

§ General working capital as the Company continues its strategy of securing oil and gas assets in proven and frontier oil and gas basins.

The Placing Price of 14 pence per Ordinary Share represents a discount of 8.5 per cent. to the Company's average closing mid market price over a period of three months prior to the announcement of the Acquisition, being 15.3 pence, and a discount of 9.6 per cent. to the Company's average closing mid market price since the start of the 2012 calendar year, being 15.5 pence.

The Placing Shares are being issued from the Company's existing authorities which were approved by its shareholders at the time of the Company's Annual General Meeting held on 22 December 2011.

Application has been made for the 60,960,182 Placing Shares to be admitted to trading on AIM and it is expected that admission will take place on 14 March 2012. The Placing Shares will rank pari passu with the existing Ordinary Shares of the Company. Following admission, the total issued share capital of the Company will be 672,562,005 Ordinary Shares.

Parkmead's Executive Chairman, Tom Cross (together with entities affiliated to him) has indicated an intention to subscribe for 24,695,090 Placing Shares, representing 40.5 per cent. of the total Placing Shares to be issued. Following this subscription, Tom Cross' beneficial holding in the Company (together with entities affiliated to him) will increase to 194,456,615 Ordinary Shares representing 28.91 per cent. of the enlarged issued share capital of the Company following admission of the Placing Shares.

In addition to Tom Cross' participation in the Placing, Donald MacKay, Chief Financial Officer and Philip Dayer, Non Executive Director, have each indicated an intention to subscribe for respectively 152,445 and 357,142 Ordinary Shares in the Placing.

Following this subscription, Donald MacKay and Philip Dayer's beneficial holdings in the Company will be, respectively, 1,681,918 Ordinary Shares representing 0.25 per cent. and 957,142 Ordinary Shares representing 0.14 per cent. of the enlarged issued share capital of the Company following admission of the Placing Shares.

The proposed participation by the Directors in the Placing will, if entered into, be considered to be a related party transaction for the purposes of AIM Rule 13, and accordingly Ian Rawlinson, the Independent Director, having consulted with Charles Stanley Securities, the Company's nominated adviser, considers the terms of the transaction to be fair and reasonable insofar as the Company's shareholders are concerned.

Tom Cross, Executive Chairman of Parkmead, commented, "We are delighted to have received this investment from a range of new institutional investors, which demonstrates support for the Parkmead business strategy. My commitment to Parkmead is highlighted by my intention to participate in the Placing, which is in addition to the loan that I have already given to the Company, and reflects my belief in the future opportunities that exist for Parkmead. Both the Acquisition and the Placing announced today are important to Parkmead as together they provide the Company with its first producing assets and also with further funds to help establish itself as a North Sea operator as we seek to generate significant future value for all our shareholders."

For enquiries please contact:

Notes to Editors: 

1. Parkmead is an independent oil and gas company that is listed on AIM on the London Stock Exchange (symbol: PMG). Parkmead's primary focus is in the upstream oil and gas exploration and production sector, targeting transactions at both asset and corporate levels.

2. In November 2011, Parkmead completed the acquisition of stakes in UK Blocks 48/1a, 47/5b and 48/1c containing the Platypus gas field, discovered in 2010, and the Possum gas prospect. The next well at Platypus is expected to start drilling in March 2012, and mapping indicates the potential for Platypus to contain up to 180 billion cubic feet of gas in place.

3. In December 2011, Parkmead announced that it had signed an agreement to acquire stakes in blocks 47/4d, 47/5d, 47/10c and 48/6c in the UK Southern North Sea, which contain the large Pharos gas prospect. This structure has the potential to hold up to 500 billion cubic feet of gas in place. These two acquisitions have marked important steps in Parkmead's first stage of its development as a new independent energy company. This acquisition completed in February 2012.

4. Parkmead's capabilities have been significantly enhanced through the acquisition and integration of Aupec Limited ("Aupec"). As a result, going forward the Group plans to actively pursue investment and advisory opportunities throughout the North Sea, and internationally, using the combined capabilities of the enlarged Parkmead Group.

5. Through its wholly owned subsidiary, Aupec, the Parkmead Group provides petroleum economics, benchmarking and valuation expertise to a wide range of government bodies and international oil and gas companies. Aupec has to date worked with over 100 governments, national oil companies, majors and independents, across the world, as well as a number of multi-national agencies such as the European Commission and the World Bank. Aupec is currently undertaking an important benchmarking project for a group of the world's largest super-major oil companies.

For further information please refer to Parkmead's website at www.parkmeadgroup.com and Aupec's website at www.aupec.com

6. The Co-Venturers in the licences currently being acquired by Parkmead, and their respective interests, are as follows:

THE INFORMATION CONTAINED HEREIN IS RESTRICTED AND IS NOT FOR PUBLICATION, RELEASE OR DISTRIBUTION, DIRECTLY OR INDIRECTLY, IN OR INTO THE UNITED STATES, CANADA, AUSTRALIA, JAPAN, THE REPUBLIC OF SOUTH AFRICA, NEW ZEALAND, OR THE REPUBLIC OF IRELAND OR ANY JURISDICTION IN WHICH SUCH PUBLICATION RELEASE OR DISTRIBUTION WOULD BE UNLAWFUL.

Certain statements in this announcement are forward-looking statements which are based on the Company's expectations, intentions and projections regarding its future performance, anticipated events or trends and other matters that are not historical facts. These statements are not guarantees of future performance and are subject to known and unknown risks, uncertainties and other factors that could cause actual results to differ materially from those expressed or implied by such forward-looking statements. Factors that would cause actual results or events to differ from current expectations, intentions or projections might include, amongst other things, changes in oil prices, changes in equity markets, failure to establish estimated petroleum reserves, political risks, changes to regulations affecting the Company's activities, delays in obtaining or failure to obtain any required regulatory approval, failure of equipment, uncertainties relating to the availability and costs of financing needed in the future, the uncertainties involved in interpreting drilling results and other geological, geophysical and engineering data, delays in obtaining geological results, the success of future explorations, acquisitions and other strategic transactions and other risks associated with offshore exploration, development and production. Given these risks and uncertainties, prospective investors are cautioned not to place undue reliance on forward-looking statements, which are not guarantees of future performance. Forward-looking statements speak only as of the date of such statements and, except as required by the FSA, the London Stock Exchange or applicable law, each of the Company and Charles Stanley expressly disclaims any obligation or undertaking to review, revise or release publicly any updates to any forward-looking statements to reflect any changes in Parkmead's expectations with regard thereto or any changes in events, conditions or circumstances on which any such statement is based, whether as a result of new information, future events or otherwise.

This announcement is for information purposes only and shall not constitute an offer to buy, sell, issue, or subscribe for, or the solicitation of an offer to buy, sell, issue, or subscribe for any securities, nor shall there be any sale of securities in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such jurisdiction. This announcement has been issued by and is the sole responsibility of Parkmead.

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 Charles Stanley or by any of its affiliates or agents as to, or in relation to, the accuracy or completeness of this announcement, including the Appendix, 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.

Charles Stanley, which is authorised and regulated in the United Kingdom by the FSA, is acting for Parkmead and for no-one else in connection with the Placing, and will not be responsible to anyone other than Parkmead for providing the protections afforded to customers of Charles Stanley nor for providing advice to any other person in relation to the Placing or any other matter referred to herein.

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 Parkmead or Charles Stanley 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 Parkmead and Charles Stanley to inform themselves about, and to observe such restrictions.

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.

MEMBERS OF THE PUBLIC ARE NOT ELIGIBLE TO TAKE PART IN THE PLACING. THIS ANNOUNCEMENT (INCLUDING THE APPENDIX) AND THE TERMS AND CONDITIONS SET OUT IN THIS ANNOUNCEMENT ARE FOR INFORMATION PURPOSES ONLY AND ARE DIRECTED ONLY AT PERSONS WHO ARE: (A) (I) INVESTMENT PROFESSIONALS FALLING WITHIN ARTICLE 19(5) OF THE FINANCIAL SERVICES AND MARKETS ACT 2000 (FINANCIAL PROMOTION) ORDER 2005 (THE "ORDER"), OR (II) PERSONS FALLING WITHIN ARTICLE 49(2)(A) TO (D) ("HIGH NET WORTH COMPANIES, UNINCORPORATED ASSOCIATIONS, ETC") OF THE ORDER, OR (III) PERSONS TO WHOM IT MAY OTHERWISE BE LAWFULLY COMMUNICATED; AND (B) (I) PERSONS IN MEMBER STATES OF THE EUROPEAN ECONOMIC AREA WHO ARE QUALIFIED INVESTORS (AS DEFINED IN ARTICLE 2(1)(E) OF EU DIRECTIVE 2003/71/EC (THE "PROSPECTUS DIRECTIVE")), AND/OR (II) PERSONS IN THE UNITED KINGDOM WHO ARE QUALIFIED INVESTORS (ALL SUCH PERSONS TOGETHER BEING REFERRED TO AS "RELEVANT PERSONS"). THIS ANNOUNCEMENT (INCLUDING THE APPENDICES) AND THE TERMS AND CONDITIONS SET OUT IN THIS ANNOUNCEMENT MUST NOT BE ACTED ON OR RELIED ON BY PERSONS WHO ARE NOT RELEVANT PERSONS. ANY INVESTMENT OR INVESTMENT ACTIVITY TO WHICH THIS ANNOUNCEMENT (INCLUDING THE APPENDICES) AND THE TERMS AND CONDITIONS SET OUT IN THIS ANNOUNCEMENT RELATE IS AVAILABLE ONLY TO RELEVANT PERSONS AND WILL BE ENGAGED IN ONLY WITH RELEVANT PERSONS. THIS ANNOUNCEMENT (INCLUDING THE APPENDICES) DOES NOT ITSELF CONSTITUTE AN OFFER FOR SALE OR SUBSCRIPTION OF ANY SECURITIES IN THE PARKMEAD GROUP PLC.

Persons (including individuals, funds or otherwise) by whom or on whose behalf a commitment to acquire Placing Shares has been given ("Placees") will be deemed to have read and understood this announcement, including the 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 the Appendix. In particular, each such Placee represents, warrants and acknowledges that it is: (i) 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; (ii) not within the United States; (iii) not within Australia, Canada, South Africa, Japan, New Zealand or the Republic of Ireland or any other jurisdiction in which it is unlawful to make or accept an offer to acquire the Placing Shares; (iv) not acquiring the Placing Shares for the account of any person who is located in the United States unless the instruction to acquire was received from a person outside the United States and the person giving such instruction has confirmed that it has the authority to give such instruction, and that either (a) it has investment discretion over such account or (b) it is an investment manager or investment company and, in the case of each of (a) and (b), that it is acquiring the Placing Shares in an "offshore transaction" (within the meaning of Regulation S under the United States Securities Act of 1933, as amended ("Securities Act"); and (v) it is not acquiring the Placing Shares with a view to the offer, sale, resale, transfer, delivery or distribution, directly or indirectly, of any such Placing Shares into the United States or any other jurisdiction referred to in (iii) above.

This announcement, including the Appendix, is not for distribution directly or indirectly in or into the United States (including its territories and possessions, any State of the United States and the District of Columbia), Canada, Australia, South Africa, Japan, New Zealand or the Republic of Ireland or any jurisdiction into which the same would be unlawful. This announcement is not an offer of securities for sale in the United States. Securities may not be offered or sold in the United States absent registration or an exemption from registration. No offering of securities will be made in the United States by Parkmead in connection with the Placing.

This announcement does not constitute or form part of an offer or solicitation to purchase or subscribe for shares in the capital of Parkmead in Canada, Australia, South Africa, Japan, New Zealand or the Republic of Ireland or any jurisdiction in which such an offer or solicitation is unlawful. No public offering of securities of Parkmead will be made in connection with the Placing in the United Kingdom or elsewhere.

The relevant clearances have not been, and 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, and nor will they be, registered under or offered in compliance with the securities laws of any state, province or territory of Canada, Australia, South Africa, Japan, New Zealand or the Republic of Ireland. 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 the United States, Canada, Australia, South Africa, Japan, New Zealand or the Republic of Ireland or any other jurisdiction outside the United Kingdom.

The Placing Shares have not been approved or disapproved by the US Securities and Exchange Commission, any State securities commission or any 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 unlawful.

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

The Placing Shares to be issued pursuant to the Placing will not be admitted to trading on any stock exchange other than the London Stock Exchange. Neither the content of Parkmead's website nor any website accessible by hyperlinks on Parkmead's website is incorporated in, or forms part of, this announcement.

Persons by whom or on whose behalf a commitment to acquire Placing Shares has been given will be deemed to have read and understood this announcement, including the 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 the Appendix.

APPENDIX

TERMS AND CONDITIONS OF THE PLACING

For Invited Placees Only

Important Information

1. Eligible participants

This Appendix, including the terms and conditions of the Placing set out herein, is directed only at persons who are FSMA Qualified Investors.

In this Appendix:

a. "you" or "Placee" means any person who is, or becomes, committed to subscribe for Placing Shares under the Placing pursuant to a legally binding commitment given to Charles Stanley acting as agent and broker for the Company; and

b. terms defined elsewhere in this announcement (in particular in the Definitions at the end of this announcement) have the same meanings, unless the context requires otherwise.

Members of the public are not eligible to take part in the Placing.

2. Overseas jurisdictions

The distribution of this announcement and the Placing and/or the issue of Placing Shares pursuant to the Placing in certain jurisdictions may be restricted by law. FSMA Qualified Investors who seek to participate in the Placing must inform themselves about and observe any such restrictions. In particular, this announcement and the information contained herein is not for publication or distribution, directly or indirectly, to persons in the United States, Canada, Australia, New Zealand, Japan, South Africa or the Republic of Ireland or in any jurisdiction in which such publication or distribution is or may be unlawful. Furthermore, this announcement does not constitute an offer or invitation (or a solicitation of any offer or invitation) to subscribe for or acquire, sell or purchase or otherwise deal in Placing Shares in the United States, Canada, Australia, Japan or South Africa or in any other jurisdiction in which any such offer, invitation or solicitation is or would be unlawful. No public offer of securities of the Company is being made in the United Kingdom, United States or elsewhere.

The Placing Shares have not been and will not be registered under the US 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 accordingly may not be offered, sold or transferred within the United States except pursuant to an exemption from, or in a transaction not subject to, registration under the Securities Act.

3. Placing

Charles Stanley is arranging the Placing as agent for and on behalf of the Company. Charles Stanley will determine the extent of each Placee's participation in the Placing, which will not necessarily be the same for each Placee. The placing obligations of Charles Stanley in connection with the Placing are set out in the Placing Agreement (further details of which are described in paragraph 7 and 8 of this Appendix). No commissions will be paid to or by Placees in respect of their agreement to subscribe for any Placing Shares.

Each Placee will be required to pay to Charles Stanley, on the Company's behalf, the Placing Price as the subscription sum for each Placing Share agreed to be subscribed by it under the Placing in accordance with the terms and conditions set out in or referred to in this Appendix. Each Placee's obligation to subscribe and pay for Placing Shares under the Placing will be owed to each of the Company and Charles Stanley. Each Placee will be deemed to have read and understood this announcement in its entirety. To the fullest extent permitted by law and applicable FSA rules, neither Charles Stanley nor any other Charles Stanley Person, will have any liability to Placees or to any person other than the Company in respect of the Placing.

Various dates referred to in this announcement are stated on the basis of the expected timetable for the Placing. It is possible that some of these dates may be changed. The expected date for Admission is currently 14 March 2012 and, in any event, the latest date for Admission is 28 March 2012 (the "Long-Stop Date").

4. Participation and settlement

Participation in the Placing is only available to persons who are invited to participate in it by Charles Stanley.

A Placee's commitment to subscribe for a fixed number of Placing Shares at the Placing Price under the Placing will be agreed orally or in writing with Charles Stanley. Such agreement will constitute a legally binding and irrevocable commitment on your part to subscribe for that number of Placing Shares at the Placing Price on the terms and conditions set out or referred to in this Appendix and subject to the Company's constitution, such legally binding and irrevocable commitment is subject only to the Placing conditions set out in paragraph 8 of this Appendix.

The expected timetable for settlement will be as follows:

At such point, each Placee will have an immediate, separate, irrevocable and legally binding obligation, owed to the Company and to Charles Stanley to pay to Charles Stanley (or as it may direct), in cleared funds an amount equal to the product of the Placing Price and such number of Placing Shares that such Placee has agreed to acquire.

Settlement of transactions in the Placing Shares will take place within the CREST system, subject to certain exceptions, on a "delivery versus payment" (or "DVP") basis. Charles Stanley reserves the right to require settlement for and/or delivery to any Placee of any Placing Shares by such other means as it may deem appropriate if delivery or settlement is not possible or practicable within the CREST system within the timetable set out in this announcement or would not be consistent with the regulatory requirements in any Placee's jurisdiction.If your Placing Shares are to be delivered to a custodian or settlement agent, you should ensure that the settlement instructions are copied and delivered immediately to the appropriate person within that organisation.

5. No Prospectus

No prospectus has been or will be submitted for approval by the FSA in relation to the Placing or the Placing Shares. Placees' commitments in respect of Placing Shares will be made solely on the basis of the information contained in this announcement.

6. Placing Shares

The Placing Shares will, when issued, be credited as fully paid and will rank in full for all dividends declared, made or paid after their issue and otherwise will rank pari passu in all respects with the existing issued Ordinary Shares.

Application will be made for the admission of the Placing Shares to trading on AIM. It is expected that Admission will take place, and dealings in the Placing Shares will commence, on 14 March 2012.

7. Placing Agreement

Charles Stanley has today entered into the Placing Agreement with the Company under which it has agreed, on a conditional basis, each to use all reasonable endeavours as agents of the Company to procure subscribers for Placing Shares. The Placing is not being underwritten.

8. Placing conditions

The Placing Agreement contains various conditions in respect of the Placing. The Placing is conditional, inter alia, on: (i) Admission occurring and having become effective on or before 8.00am on 14 March 2012 (or such later time as Charles Stanley may agree with the Company in writing being not later than 8.00am on 28 March 2012); and (ii) the Placing Agreement being entered into and having become unconditional in all respects and not having been terminated at any time prior to Admission in accordance with its terms.

Certain conditions may be waived, in whole or in part, and the time for satisfaction of such conditions may be extended by Charles Stanley (acting in its absolute discretion and without any obligation to make any such waiver or extension) by express written notice to the Company.

If any condition is not fulfilled or waived by Charles Stanley by the relevant time, the Placing will lapse and your rights and obligations in respect of the Placing will cease and terminate at such time.

Charles Stanley has rights, at any time prior to Admission, to terminate their obligations under the Placing Agreement in certain limited circumstances. Such circumstances include, inter alia, breach by the Company of the provisions of the Placing Agreement or any warranty therein being or becoming untrue, inaccurate or misleading in any material respect, or on the occurrence of certain specified events or changes in the financial position of the Company or of certain events of force majeure. The exercise of any right of termination of the Placing Agreement or waiver of any condition to the Placing Agreement or the extension of the time for fulfilment of any such condition, and any decision by Charles Stanley whether or not to enter into the Placing Agreement, is within the absolute discretion of Charles Stanley and Charles Stanley shall have no liability to you whatsoever in respect of any decision as to the exercise of any such right of termination or any decision to waive any such condition or to extend the time for satisfaction of any such condition or to enter into the Placing Agreement.

9. Payment default

Your entitlement to receive Placing Shares will be conditional on Charles Stanley's receipt of payment in full for such Placing Shares by 14 March 2012 (settlement date), or by such later time and date as Charles Stanley may in its absolute discretion determine. Charles Stanley may, in its absolute discretion, waive such condition, and will not be liable to you for any decision to waive or not to waive such condition.

 If you fail to make such payment by the required time for any Placing Shares: (i) the Company may release itself, and (if at its absolute discretion it decides to do so) will be released from, all obligations it may have to allot and/or issue any such Placing Shares to you or at your direction which are then unallotted and/or unissued; (ii) the Company may exercise all rights of lien, forfeiture and set-off over and in respect of any such Placing Shares to the full extent permitted under its constitution or otherwise by law and to the extent that you then have any interest in or rights in respect of any such shares; (iii) the Company or, as applicable, Charles Stanley may sell (and each of them is irrevocably authorised by you to do so) all or any such Placing Shares on your behalf and then retain from the proceeds of such sale, for the account and benefit of the Company or, where applicable, Charles Stanley: (a) any amount up to the total amount due to it as, or in respect of, subscription monies, or as interest on such monies, for any Placing Shares; (b) any amount required to cover any stamp duty or stamp duty reserve tax arising on the sale; and (c) any amount required to cover dealing costs and/or commissions necessarily or reasonably incurred by it in respect of such sale; and (iv) you will remain liable to the Company and to Charles Stanley for the full amount of any losses and of any costs which either of them may suffer or incur as a result of: (a) not receiving payment in full for such Placing Shares by the required time; and/or (b) the sale of any such Placing Shares to any other person at whatever price and on whatever terms are actually obtained for such sale by or for it. Interest may be charged in respect of payments not received by Charles Stanley for value by the required time referred to above at the rate of two percentage points above the base rate of LIBOR (as determined by Charles Stanley).

10. Placees' representations, warranties and undertakings to the Company, and Charles Stanley

By agreeing with Charles Stanley to subscribe for Placing Shares under the Placing you irrevocably acknowledge, represent, confirm, warrant and undertake to, and agree with, each of the Company, and Charles Stanley, in each case as a fundamental term of your application for Placing Shares and of the Company's obligation to allot and/or issue any Placing Shares to you or at your direction, that:

a) you have read this announcement and agree to and accept all of the terms and conditions set out in this announcement (including, but not limited to, this Appendix);

b) no prospectus, admission document or other offering document has been or will be prepared in connection with the Placing and you have not received a prospectus, admission document or other offering document in connection with the Placing and/or the Placing Shares;

c) 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, which includes a description of the nature of the Company's business and the Company's most recent AIM admission document and financial statements and you are able to obtain or access such information, and are able to obtain access to the Company's published financial statements or comparable information concerning any other publicly traded company;

d) your rights and obligations in respect of the Placing will terminate only in the circumstances referred to in this announcement and will not be subject to rescission or termination by you in any circumstances;

e) this announcement, which has been issued by the Company, is the sole responsibility of the Company and neither Charles Stanley, nor any of its affiliates nor any person acting on its behalf or any of their affiliates have, or shall have, any liability for any information, representation or statement contained in this announcement or any information previously published by or on behalf of the Company in connection with the Placing;

f) you have not been, and will not be, given any warranty or representation in relation to the Placing Shares or to the Company or to any other member of its Group in connection with the Placing;

g) you have not relied on any representation or warranty in reaching your decision to subscribe for Placing Shares under the Placing;

h) you are not a client of Charles Stanley in relation to the Placing and Charles Stanley is not acting for you in connection with the Placing and it will not be responsible to you in respect of the Placing for providing protections afforded to its clients;

i) you have not been, and will not be, given any warranty or representation by any Charles Stanley Person in relation to any Placing Shares, the Company or any other member of its Group and no Charles Stanley Person will have any liability to you for any information contained in this announcement or which has been published by the Company or for any decision by you to participate in the Placing based on any such information or on any other information provided to you;

j) in making your decision to acquire any Placing Shares, you: (i) have not relied on any investigation that Charles Stanley or any person acting on its behalf may have conducted with respect to the Placing Shares or the Company; (ii) have made your own investment decision regarding the Placing Shares based on your own knowledge (and information you may have or which is publicly available) with respect to the Placing Shares and the Company; (iii) have had access to such information as you deem necessary or appropriate in connection with your acquisition of any Placing Shares; and (iv) have sufficient knowledge and experience in financial and business matters and expertise in assessing credit, market and all other relevant risk and are capable of evaluating, and have evaluated, independently, the merits, risks and suitability of purchasing the Placing Shares;

k) you understand that by your acquisition or holding of any Placing Shares you are assuming, and are capable of bearing, the risk of loss that may occur with respect to the Placing Shares, including the possibility that you may lose all or a substantial portion of your investment in any Placing Shares, and you will not look to the Company or any Charles Stanley Person for all or part of any such loss or losses you may suffer;

l) you have neither received nor relied on any confidential price-sensitive information concerning the Company in accepting this invitation to participate in the Placing;

m) you will pay the full subscription amount as and when required in respect of all Placing Shares allocated to you and will do all things necessary on your part to ensure that payment for such Placing Shares and their delivery to you or at your direction is completed in accordance with the standing CREST instructions (or, where applicable, standing certificated settlement instructions) that you have in place with Charles Stanley or put in place with Charles Stanley with its agreement;

n) you are entitled to subscribe for Placing Shares under the laws of all relevant jurisdictions which apply to you and you have complied, and will fully comply, with all such laws (including where applicable, the Anti-Terrorism, Crime and Security Act 2001, the Proceeds of Crime Act 2002 and the Money Laundering Regulations 2007) and have obtained all governmental and other consents (if any) which may be required for the purpose of, or as a consequence of, such subscription, and you will provide promptly to Charles Stanley such evidence, if any, as to the identity or location or legal status of any person which Charles Stanley may request from you in connection with the Placing (for the purpose of its complying with any such laws 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 Charles Stanley on the basis that any failure by you to do so may result in the number of Placing Shares that are to be allotted and/or issued to you or at your direction pursuant to the Placing being reduced to such number, or to nil, as Charles Stanley may decide at its sole discretion;

o) you, and, if different, the beneficial owner of the Placing Shares, are not and at the time the Placing Shares are acquired, will not be residents of Australia, New Zealand, Canada, Japan, South Africa or the Republic of Ireland or any other jurisdiction in which the Placing or any connected offer, invitation or solicitation is or would be unlawful;

p) you have complied and will comply with all applicable provisions of FSMA with respect to anything done or to be done by you in relation to any Placing Shares in, from or otherwise involving the United Kingdom and you have not made or communicated or caused to be made or communicated, and you will not make or communicate or cause to be made or communicated, any "financial promotion" in relation to Placing Shares in contravention of section 21 of FSMA;

q) you or your agent who manages investments on your behalf on a discretionary basis are a FSMA Qualified Investor;

r) you are acting as principal only in respect of the Placing or, if you are acting for any other person: (i) you are duly authorised to do so; (ii) you are and will remain liable to the Company and/or Charles Stanley for the performance of all your obligations as a Placee in respect of the Placing (regardless of the fact that you are acting for another person); (iii) you are both an "authorised person" for the purposes of FSMA and a "qualified investor" as defined at Article 2.1(e)(i) of Directive 2003/71/EC (known as the Prospectus Directive) acting as agent for such person; and (iv) such person is either: (a) a FSMA Qualified Investor; or (b) a "client" (as defined in section 86(2) of FSMA) of yours that has engaged you to act as his agent on terms which enable you to make decisions concerning the Placing or any other offers of transferable securities on his behalf without reference to him;

s) nothing has been done or will be done by you in relation to the Placing or to any Placing Shares that has resulted or will result in any person being required to publish a prospectus in relation to the Company or to any Ordinary Shares or Placing Shares in accordance with FSMA or the Prospectus Rules or in accordance with any other laws applicable in any part of the European Union or the European Economic Area;

t) you are not, and are not acting in relation to the Placing as nominee or agent for, a person who is or may be liable to stamp duty or stamp duty reserve tax in respect of any agreement to acquire (or any acquisition of) shares or other securities (including, without limitation, under sections 67, 70, 93 or 96 of the Finance Act 1986 concerning depositary receipts and clearance services), and the allocation, allotment, issue and/or delivery to you, or any person specified by you for registration as holder, of Placing Shares will not give rise to a liability under any such section; (ii) the person whom you specify for registration as holder of Placing Shares will be you or your nominee or (as applicable) the person for whom you are acting or its nominee; (iii) you and any person for whom you are acting will acquire Placing Shares on the basis that they will be allotted to the CREST stock account of Charles Stanley and that Charles Stanley will then hold them as settlement agent and as nominee for you or such person until settlement in accordance with Charles Stanley's settlement instructions; (iv) payment for Placing Shares will be made simultaneously on their receipt in your stock account on a "delivery versus payment" (or "DVP") basis; and (v) neither Charles Stanley nor the Company will be responsible to you or anyone else for any liability to pay stamp duty or stamp duty reserve tax resulting from any breach of, or non-compliance, with this paragraph;

u) you will not treat any Placing Shares in any manner that would contravene any legislation applicable in any territory or jurisdiction and no aspect of your participation in the Placing will contravene any legislation applicable in any territory or jurisdiction in any respect or cause the Company or Charles Stanley to contravene any such legislation in any respect;

v) you understand and acknowledge that no steps have been taken to enable any of the Placing Shares to be acquired by persons outside the United Kingdom and accordingly:

(1) you were outside the United States at the time your subscription was originated and you were not at such time, and are not, a US Person (and were not, and are not, acquiring on behalf of, or purchasing for the account or benefit of, a US Person) within the meaning of Regulation S promulgated under the United States Securities Act of 1933, as amended, (the "1933 Act") and you will not offer, sell or deliver directly or indirectly any of the Placing Shares in the United States;

(2) you acknowledge and agree that none of the Placing Shares have been or will be registered under the 1933 Act or under the securities laws of any state of the United States and neither you, your affiliates nor any person acting on your behalf has knowingly engaged or will engage in any direct selling efforts in the United States of America with respect to the Placing Shares (terms in this paragraph have meanings ascribed to them by Regulation S under the 1933 Act);

(3) you acknowledge that none of the Placing Shares have been or will be registered under the relevant Canadian, Japanese or Australian securities laws;

(4) you are not a national or resident of Canada, Australia, the Republic of Ireland, Japan or South Africa or a corporation, partnership or other entity organised under the laws of Canada (or any political sub-division thereof), Australia, the Republic of Ireland, Japan or South Africa and that you will not offer, sell or deliver directly or indirectly as principal or agent any of the Placing Shares in Canada, Australia, the Republic of Ireland, Japan or South Africa or to or for the benefit of any person resident in Canada, Australia, the Republic of Ireland, Japan or South Africa or to any person purchasing such shares for re-offer, sale or transfer in Canada, Australia, the Republic of Ireland, Japan or South Africa and you are not acting for any such national or resident or with a view to resale to any overseas person (whether resident in Canada, Australia, the Republic of Ireland, Japan or South Africa or otherwise); and

(5) you are not in or a national or resident of any other territory in which it is unlawful to make an offer to subscribe for Placing Shares or to reply to this letter;

w) Charles Stanley is entitled, but shall be under no obligation to, satisfy its obligations to procure Placees by itself agreeing to become a Placee in respect of some or all of the Placing Shares or by nominating any other Charles Stanley Person or any person associated with any Charles Stanley Person to do so;

x) time is of essence as regards your obligations under this Appendix;

y) this Appendix and any contract (whether oral or written) which may be entered into between you and Charles Stanley and/or the Company, and all non-contractual obligations arising between you and Charles Stanley and/or the Company, pursuant to or in connection with it or the Placing, will be governed by and construed in accordance with the laws of England, for which purpose you submit (for yourself and on behalf of any person on whose behalf you are acting) to the exclusive jurisdiction of the English courts as regards any claim, dispute, or matter arising out of or relating to this Appendix or such contract, except that each of the Company and Charles Stanley will have the right to bring enforcement proceedings in respect of any judgment obtained against you in the English courts or in the courts of any other relevant jurisdiction;

z) each right or remedy of the Company or Charles Stanley provided for in this Appendix is in addition to any other right or remedy which is available to such person and the exercise of any such right or remedy in whole or in part will not preclude the subsequent exercise of any such right or remedy;

aa) any document that is to be sent to you in connection with the Placing will be sent at your risk and may be sent to you at any address provided by you to Charles Stanley;

bb) you shall indemnify and hold each of the Company and Charles Stanley harmless, on an after tax basis, from any and all costs, claims, liabilities and expenses (including legal fees and expenses) arising out of or in connection with any breach by you of the terms in this Appendix;

cc) your commitment to acquire Placing Shares on the terms set out in this announcement will continue notwithstanding any amendment that may in future be made to the terms of the Placing and you will have no right to be consulted or require that your consent be obtained with respect to the Company's conduct of the Placing. The foregoing acknowledgements, representations, warranties, undertakings and confirmations are given for the benefit of the Company as well as Charles Stanley;

dd) you acknowledge and agree that it is a term of your placing participation that, to ensure compliance with the Money Laundering Regulations 2007, the Anti-Terrorism Crime and Security Act 2001 and the Proceeds of Crime Act 2002 (the "Regulations"), we may, in our absolute discretion, require verification of your identity. Pending the provision to us of evidence of identity, definitive certificates in respect of Placing Shares or, where appropriate, delivery of the Placing Shares to you in uncertificated form may be retained or withheld;

ee) nothing in this Appendix will exclude any liability of any person for fraud on its part, and all times and dates in this announcement are subject to amendment at the discretion of Charles Stanley , except that in no circumstances will the date scheduled for Admission be later than the Long-Stop Date; and

ff) none of your rights or obligations in respect of the Placing is conditional on any other person agreeing to subscribe any Placing Shares under the Placing and no failure by any other Placee to meet any of its obligations in respect of the Placing will affect any of your obligations in respect of the Placing.

DEFINITIONS

The following definitions apply throughout this document and in the terms and conditions to the Placing set out in the Appendix , unless the context otherwise requires: