Restore Regulatory News (RST)

7:00am 21 October 2010

Restore plc

("Restore" or the "Company")

Proposed Placing of new ordinary shares to raise £4.0m

The Company is pleased to announce that it intends to raise £4 million (before expenses of £200,000) to strengthen the Company's balance sheet and provide capital for growth by the placing of 15,384,615 New Ordinary Shares at a price of 26p per share.

The Placing is conditional on the approval of Shareholders at a General Meeting, notice of which has been posted to shareholders of the Company today, and Admission. A copy of the circular will be made available on the Company's website at www.restoreplc.com

Background to the Placing and use of Proceeds

As noted in the Company's interim results announced on 7th September 2010, following the change in management in June 2009 the Company has moved to profitability in the first half of the current financial year. Trading was robust in the document storage business with operating profit up by 25%. The document scanning business operated profitably despite challenging market conditions which have continued since the half year end and Peter Cox, the damp treatment and timber proofing business, made a small contribution compared to a £0.4m loss in the first half of 2009. Head Office costs were reduced by over one-third and the closure of the business of ABS, which recorded a loss of £0.8m in the first half of 2009, has removed a drain on company profits and resources. Interest charges fell from £1.2m to £0.6m and will reduce further following the conversion of £8.0m of subordinated debt into equity in April 2010. The Company acquired Datacare in September 2010 which should further strengthen and increase the profitability of our document storage activities.

The Placing monies raised will strengthen the Company's balance sheet by reducing the indebtedness of the Group. In addition, the Placing will provide proceeds to allow the Company to take advantage of organic growth opportunities and potential acquisitions in the data management and broader support services sector as they arise.

The Placing will also widen the shareholder base of Restore which the Board believes will increase the marketability and valuation of the Company's shares. The shareholding of Geraldton, the Company's majority shareholder who currently owns 86.71 per cent of the issued share capital of the Company, will be diluted as a result of the Placing to a holding of 26,583,259 Ordinary Shares representing 57.74 per cent. of the Enlarged Share Capital, which should assist with increasing liquidity in the Company's shares.

Each of the Directors, being Charles Skinner, Andrew Wilson and Sir William Wells, have agreed to subscribe for in aggregate 615,383 of the New Ordinary Shares in the Placing amounting to a total value of approximately £160,000. In addition, certain members of the senior management team have agreed to subscribe for in aggregate 467,305 of the New Ordinary Shares or a value of approximately £121,499.

The issue of the New Ordinary Shares is conditional on the passing of the Resolutions and Admission. Admission is expected to take place on 9th November 2010. The New Ordinary Shares will, upon issue, rank pari passu in all respects with the existing issued Ordinary Shares.

Following completion of the Placing, the Enlarged Share Capital will comprise 46,043,372 Ordinary Shares.

Following completion of the Placing the revised shareholdings of the Directors will be as set out below.

Trading Update

Trading remains robust in the core document storage business. The integration of Datacare, which was acquired in September, is progressing well and can be expected to make a significant contribution to 2011 document storage earnings. The scanning business, DCS, continues to operate in a difficult market and focus remains on minimising costs. Peter Cox, our building preservation specialist, continues to show significant year-on-year improvement in profitability.

General Meeting

The General Meeting of the Company is to be held at 10:00am on 8th November 2010 at Marble Arch Tower, 55 Bryanston Street, London W1H 7AA.

The Placing Agreement

Cenkos has entered into a Placing Agreement with the Company whereby it has agreed to use its reasonable endeavours, as agent for the Company, to procure placees for 15,384,615  Ordinary Shares.

The placing of the New Ordinary Shares is conditional upon, inter alia, Admission on or before 8.00am on 9th November 2010 (or such later time and/or date as the Company and Cenkos may agree, but in any event by no later than 8.00am on 19th November 2010).

The Placing Agreement contains warranties from the Company in favour of Cenkos in relation to, inter alia, the accuracy of the information in this document and other matters relating to the Company and its business. In addition, the Company has agreed to indemnify Cenkos in relation to certain liabilities it may incur in respect of the Placing. Cenkos has the right to terminate the Placing Agreement in certain circumstances prior to Admission, in particular, in the event of a material breach of the warranties.

Dealings

Application will be made to the London Stock Exchange for the New Ordinary Shares to be admitted to trading on AIM. It is expected that Admission will occur on 9th November 2010.

The New Ordinary Shares will, when issued, rank pari passu in all respects with the existing issued Ordinary Shares including the right to receive dividends and other distributions declared following the relevant admission.

The Directors consider the proposals set out in the circular posted to shareholders today to be in the best interests of the Company and its Shareholders as a whole. Accordingly, the Directors recommend Shareholders to vote in favour of the Resolutions to be proposed at the General Meeting, as they intend to in respect of their shareholdings of 260,800 existing Ordinary Shares, representing approximately 0.85 per cent. of the current issued ordinary share capital of the Company.

Enquires

Charles Skinner, Chief Executive

Restore plc Tel: 07966 234 075

Nicholas Wells

Elizabeth Bowman Tel: 0207397 8928

Cenkos Securities plc, NOMAD and Broker

John Coles Tel: 020 7653 9848

Threadneedle Communications