RGD.L Regulatory News (RGD)

Real Good Food PLC ("the Company")

Historical related party transactions

Further to the Company's notification of 1 August 2017 in relation to historical consultancy payments made to certain former and current Directors of the Company (the "Directors") that had not been disclosed as related party transactions within its previously published and audited Annual Report & Accounts for the periods ending 31 March 2014 ("FY 14"), 31 March 2015 ("FY 15") and 31 March 2016 ("FY 16"), the Company hereby confirms the amounts of previously undisclosed consultancy payments and previously undisclosed Director fees made to these Directors.

Table 1

Note:

* includes a success fee of £1.1m pursuant to the sale of Napier Brown Sugar Limited. The balance of £219k is comprised of consultancy fees. A loan of £39k was also provided to P Totté in this year which was subsequently repaid in June 2017.

Previously undisclosed fees of £56k relating to the performance of Non-Executive Director duties in FY 13, FY 14 and FY 15 were paid to Jacques d'Unienville in FY 16.

In light of the recent discovery that transactions for these separately remunerated activities had not been appropriately declared as related party transactions in the Company's Annual Report & Accounts as regulation required, the Board carried out an exercise to establish precisely what payments had been made to which related parties, with the assistance of the forensic accounting department of BDO LLP. In addition to this, the scope of the examination of historic records was extended to cover any and all payments & transactions to Directors in whatever capacity they acted. The table above therefore also includes details of previously undisclosed payments made to Pieter Totté, Peter Salter and Pat Ridgwell in the years ending 31 March 2017 ("FY 17") and the current financial year ending 31 March 2018 ("FY 18"), which will be included in the related party transaction notes to the Company's Annual Report & Accounts for the relevant financial period.

In the case of Pieter Totté, the aggregated payments detailed in Table 1 were made pursuant to Consultancy Agreements for services relating to merger and acquisition and other specific project work which was out-with his day to day role as the Company's Executive Chairman. At the time Pieter Totté was appointed as Executive Joint Chairman on 4 November 2009, the Board agreed that he would receive a salary for the role of Executive Chairman but that he would also continue, at his behest, to carry out a significant role as an M&A and project adviser to the Company which would be remunerated in the form of consultancy payments. The aggregate consultancy payments made in FY 14, FY 15 and FY 16 were £253k, £336k and £219k respectively. In addition, a separate success fee of £1.1m was made in FY 16 in relation to the successful disposal of Napier Brown Sugar Limited.

As previously noted, all of the payments detailed in Table 1 were fully accounted for in the relevant accounting periods so have no impact on the reported profit before tax for these three years.

Furthermore, certain of the transactions detailed in Table 1 were not notified as related party transactions pursuant to AIM Rule 13, and the Independent Directors did not consult with the Company's Nominated Adviser at the time for the purposes of establishing whether the payments were "fair and reasonable". The payments which would have needed separate disclosure pursuant to AIM Rule 13, (including a fair and reasonable opinion from the Independent Directors of the Company at that time), were the aggregated consultancy payments made to Pieter Totte in FY 15 and FY 16 of £336k and £219k respectively and the £1.1m bonus payment made in FY 16 (the "AIM Related Party Transactions").

The Independent Directors of the Company at the time these payments were made, being Pat Ridgwell, Christopher Thomas and Jacques d'Unienville consider that the terms of the AIM Related Party Transactions were fair and reasonable at the time insofar as the Company's shareholders are concerned, taking account of the anticipated costs of other professional advisers providing similar services.

The Board is clear that the standards of Corporate Governance and reporting have historically been below those which investors might reasonably expect and is committed to rectifying this important aspect of operations and disclosure. The Board therefore intends to appoint external advisers to conduct a full review of the Company's Corporate Governance and Financial Reporting procedures, and will make a further announcement when this review has been completed and any necessary changes implemented.

-Ends-

ENQUIRIES:

Real Good Food plc

Chris Thomas, Executive Director Tel: 020 38573900

Harveen Rai, Finance Director

Andrew Brown, Marketing Director

finnCap Ltd (Nomad and Broker)

Matt Goode Tel: 020 7220 0500

Carl Holmes

Belvedere Communications (PR)

John West Tel: 020 3567 0510

Kim van Beeck

About Real Good Food plc

Real Good Food plc is a diversified food business serving a number of market sectors including retail, manufacturing, wholesale, foodservice and export. The Group focuses on three main markets: Cake Decoration (Renshaw, Rainbow Dust Colours), Food Ingredients (Brighter Foods, Garrett Ingredients and R&W Scott) and Premium Bakery (Haydens and Chantilly Patisserie).