STR.L Regulatory News (STR)

THIS ANNOUNCEMENT (INCLUDING THE APPENDIX) AND THE INFORMATION CONTAINED HEREIN IS RESTRICTED AND IS NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, IN WHOLE OR IN PART, DIRECTLY OR INDIRECTLY, IN, INTO OR FROM THE UNITED STATES (INCLUDING ITS TERRITORIES AND POSSESSIONS, ANY STATE OF THE UNITED STATES OR THE DISTRICT OF COLUMBIA), AUSTRALIA, CANADA, JAPAN, THE REPUBLIC OF SOUTH AFRICA OR ANY OTHER JURISDICTION IN WHICH SUCH RELEASE, PUBLICATION OR DISTRIBUTION WOULD BE UNLAWFUL.

The information contained within this announcement is deemed to constitute inside information as stipulated under the Market Abuse Regulations (EU) No. 596/2014. Upon the publication of this announcement, this inside information is now considered to be in the public domain.

29 July 2016

Stride Gaming plc

("Stride Gaming", or the "Company")

Proposed Acquisitions of Tarco Assets, Netboost Media and 8Ball GamesandPlacing to raise gross proceeds of £27 million

Stride Gaming plc (AIM: STR), the multi-branded online gaming operator, announces that it has conditionally agreed to acquire certain assets (the "Tarco Assets") of Tarco Limited ("Tarco"), the entire issued share capital of Netboost Media Limited ("Netboost Media"), a marketing business which services the Tarco Assets, and the entire issued share capital of 8Ball Games Limited ("8Ball") (together, the "Acquisitions").

The Acquisitions will be funded in part by a conditional placing on a non pre-emptive basis of shares in Stride Gaming (the "Placing Shares") at a price of 225 pence per Placing Share (the "Placing Price"), raising gross proceeds of £27 million (before commissions, fees and transaction costs) (the "Placing") with the balance to be satisfied by the issue of new Ordinary Shares and the Company's cash resources.

Rationale and synergies

The Acquisitions augment the Company's vision to become the global market leader in the soft gaming vertical of the online gaming industry and are in line with Stride Gaming's strategy to maximise shareholder value by achieving growth through organic and acquisitive means.

Once completed, the Acquisitions will:

· Increase Stride Gaming's market share of the UK bingo market from 5% to 10%, making Stride Gaming the fourth largest online bingo operator in the UK;

· Expand the Company's multi-branded offering by 96 brands to 105 brands, increasing Stride Gaming's share of the UK online bingo landscape from 2% to over 25% (by number of bingo sites); and

· Bring significant scale and a number of leading bingo brands to Stride Gaming's business, together with the opportunity for meaningful operational leverage.

The Acquisitions already present attractive player fundamentals; however they provide the opportunity for significant further improvements through leveraging off Stride Gaming's leading software platform and marketing expertise, together with delivering synergies through cross marketing, lowering of CPA, increasing customer LTV and reducing player churn. In particular, the Acquisitions are expected to:

· Be accretive in the first full year of ownership (pre-synergies);

· Deliver cost synergies (marketing, administration, distribution) of an estimated £2.5m (post earn out);

· Deliver revenue synergies (increase in LTV, yield and net cash hold) of an estimated £3m (post earn out).

Tarco Assets and Netboost Media Acquisition highlights:

Tarco is an online bingo operator with a 3% market share of the UK online bingo market and has over 63,000 active players. It has 22 B2C bingo brands and four B2B brands, including Moon Bingo and Robin Hood Bingo. The Tarco Acquisition brings scale and a number of leading bingo brands to Stride Gaming.

The total consideration of up to £40.2 million for the Tarco Assets and Netboost Media comprises:

· Tarco Assets

o Initial consideration of £16.0 million (on a debt free, cash free basis) payable on completion, of which £7.7 million will be paid in cash and the balance satisfied by the issue of 3,219,500 new Ordinary Shares; and

o Earn-out consideration of up to £22.0 million, equal to 7.5 times adjusted EBITDA for the 12 month period to 31 December 2017, less the initial consideration, payable in a mix of 51% cash and 49% shares.

· Netboost Media

o Total consideration of £2.2m, payable in cash on completion

8Ball Acquisition highlights:

8Ball is an online bingo operator with a 2% market share of the UK online bingo market. It has over 60,000 active players and 74 sites, including Booty Bingo and WeWantBingo. The 8Ball Acquisition brings scale and an efficient cross-marketing Business Intelligence platform utilised to reduce churn and increase lifetime value.

The total consideration of up to £30.0 million for the entire share capital of 8Ball comprises:

o Initial consideration of £12.0 million (on a debt free, cash free basis), payable in cash on completion; and

o Earn-out consideration of up to £18.0 million, calculated as to 6.0 times adjusted EBITDA for the 12 month period following completion, less the initial consideration, payable in a mix of cash and shares, with the first £3m to be satisfied in shares and the remainder being 40% cash: 60% shares.

Summary of Placing

· Proposed Placing of 12,000,000 Placing Shares at 225 pence per Placing Share, raising gross proceeds of £27 million;

· The Placing Price represents a discount of approximately 12 per cent. to the average closing price of the Ordinary Shares for the 90 day period prior to this announcement;

· Net proceeds will be used to fund the initial cash consideration in respect of the Acquisitions, with the residual proceeds and the Company's cash resources funding the cash element of the earn out consideration.

Refinancing of existing loan

· The Company is also pleased to announce that it is in discussions with a first tier bank and has received a credit approved term sheet which outlines the terms of an £8.0 million term loan facility which would mature four years from the date of initial drawdown;

· The new facility, which is subject to certain conditions including the entering into of definitive documentation, is expected to replace the existing loan extended to the Company by its shareholder, Poppy Investments Limited which accrues interest at 7.5% and is repayable, at the Company's election, at any time prior to 30 July 2017.

The Acquisitions and the Placing are each conditional upon, amongst other things, the passing of the Resolutions at the General Meeting. However, the Acquisitions are also conditional on a number of other matters (including the receipt of various contractual change of control consents) and are, therefore, expected to complete after Admission. As such, the Placing is not conditional upon completion of the Acquisitions and there is, therefore, a possibility that the Placing Shares might be issued but that none (or not all) of the Acquisitions will complete. In these circumstances, the Directors would consider the Company's options with regard to how best to utilise the balance of the net proceeds of the Placing.

Canaccord Genuity Limited ("Canaccord Genuity"), Financial Adviser, Nominated Adviser and Joint Broker to the Company and Shore Capital Stockbrokers Limited ("Shore Capital"), Joint Broker to the Company, are acting as joint bookrunners in connection with the Placing (the "Joint Bookrunners").

Related Party Transaction and Rule 9 Waiver

Since GAL Holdings, a substantial shareholder of the Company for the purposes of the AIM Rules, is interested in the shares of Tarco and Netboost Media and Eitan Boyd and Darren Sims, directors of the Company, are interested in the shares of Tarco, the Tarco Acquisition and the Netboost Media Acquisition each constitute a related party transaction under Rule 13 of the AIM Rules.

As certain members of the Original GAL Concert Party are shareholders of Tarco and Netboost Media, they have been deemed to be acting in concert with each of Black Onyx and the Black Onyx Partners (the Tarco Transferees and the Black Onyx Partners being the ultimate recipients of the Tarco Consideration Shares pursuant to the Tarco Transfers) for the purposes of the Takeover Code. Accordingly, subject to completion of the Tarco Acquisition, the Original GAL Concert Party has been extended to include Black Onyx and the Black Onyx Partners who become members of the Enlarged GAL Concert Party.

Pursuant to the terms of the Tarco Acquisition, the Tarco Initial Consideration Shares received by Tarco at completion of the Tarco Acquisition (and any Tarco Earn Out Consideration Shares issued by the Company to Tarco) will be transferred to the Tarco Transferees immediately following their issue. The Tarco Initial Consideration Shares (and any Tarco Earn Out Consideration Shares issued by the Company to Tarco) transferred to Black Onyx will then immediately be transferred to the Black Onyx Partners.

Each time any such Tarco Consideration Shares are issued to Tarco (and subsequently transferred as described above) the members of the Enlarged GAL Concert Party will have increased their aggregate holdings in the voting rights of the Company which, without a waiver of the obligations under Rule 9, may require a member (or members) of the Enlarged GAL Concert Party to make a Rule 9 Offer for the Company. In addition, as part of the retention package of Assaf Matityahu who is Co-CEO of Netboost Media (alongside Co-CEO Michael Weinraub), Assaf Matityahu will be granted options over a total of 77,822 new Ordinary Shares exercisable at the Average Initial Share Price which will vest, as to 38,911 new Ordinary Shares on 31 December 2018 with the remaining 38,911 vesting on 31 December 2019. Each time any such new Ordinary Shares are issued to Assaf Matityahu, the Enlarged GAL Concert Party as a whole will have increased their interest in the voting rights of the Company which, without a waiver of the obligations under Rule 9, may require a member (or members) of the Enlarged GAL Concert Party to make a Rule 9 Offer for the Company.

Full details on the Related Party Transaction and Waiver Resolution are set out below and in the Circular.

Shareholder Circular

A circular to Shareholders will be posted on or around 3 August 2016 convening the General Meeting (the "Circular").

Eitan Boyd, Chief Executive of Stride Gaming, commented:

"I am delighted by the proposed acquisition of these leading gaming companies, which expedite our ambition to build Stride Gaming into the market leader in the soft gaming vertical of the online gaming industry. Not only do the acquisitions strongly complement our existing business, but they will also add material scale, deliver operational leverage, and substantial cost and revenue synergies. Most significantly, the acquisitions will increase our share of the UK online bingo market to 10%, making Stride Gaming the fourth largest online bingo operator in the UK and our combined 105 brands will represent over 25% of the UK online bingo market by number of sites.

These transformational transactions follow the successful acquisition of InfiApps in July 2015. Stride Gaming has a proven ability to generate value through undertaking value accretive acquisitions and integrating them into the Group and we are confident that we will be able to repeat the same success and deliver value for all our stakeholders. Our strategy remains focused on building scale and profitability through strong organic growth and further targeted acquisitions, taking advantage of the consolidation opportunities in the industry. With a medium-term objective to increase our market share to 15%-20% of the UK online bingo market, we will however seek to expand our presence in existing verticals not only in the UK but also in international regulated markets, as well as look to enter into other soft gaming verticals such as online lotteries and scratch cards.

With the completion of these acquisitions and the successful placing, we are in a stronger position than ever going forward. We are pleased to report that the Group is highly confident that it will meet market expectations for the full year and we look forward to updating the market on our progress in the coming months."

Enquiries:

The person responsible for arranging for the release of this announcement on behalf of the Company is Ronen Kannor, Chief Financial Officer.

The Appendices set out further information relating to the acquisitions and Placing and the terms and conditions of the Placing.

This Announcement should be read in its entirety. In particular, you should read and understand the information provided in the "Important Notices" section of this Announcement.

Important notice

This announcement, including the Appendix, and the information contained herein is not for release, publication or distribution, directly or indirectly, in whole or in part, in or into or from the United States, Canada, Australia, Japan, the Republic of South Africa or any other jurisdiction where to do so might constitute a violation of the relevant laws or regulations of such jurisdiction (the "Restricted Jurisdictions"). This announcement does not constitute or form part of any offer to sell, or any solicitation of an offer to buy, securities in the United States. The Placing Shares have not been and will not be registered under the Securities Act or under the securities laws of any state or other jurisdiction of the United States and may not be offered, sold, resold or delivered, directly or indirectly, in or into the United States absent registration except pursuant to an exemption from or in a transaction not subject to the registration requirements of the Securities Act. No public offering of the Placing Shares is being made in the United States. The Placing Shares are being offered and sold outside the United States in offshore transactions, as defined in, and in compliance with, Regulation S under the Securities Act. Persons receiving this announcement (including custodians, nominees and trustees) must not forward, distribute, mail or otherwise transmit it in or into the United States or use the United States mails, directly or indirectly, in connection with the Placing. This announcement does not constitute an offer to sell or issue or a solicitation of an offer to buy or subscribe for Placing Shares in any jurisdiction including, without limitation, the Restricted Jurisdictions or any other jurisdiction in which such offer or solicitation is or may be unlawful. This announcement and the information contained in it is not for publication or distribution, directly or indirectly, to persons in a Restricted Jurisdiction unless permitted pursuant to an exemption under the relevant local law or regulation in any such jurisdiction.

No action has been taken by the Company, Canaccord Genuity, Shore Capital or any of their respective directors, officers, partners, agents, employees or affiliates that would permit an offer of the Placing Shares or possession or distribution of this announcement or any other publicity material relating to such Placing Shares in any jurisdiction where action for that purpose is required. Persons receiving this announcement are required to inform themselves about and to observe any such restrictions.

This announcement is directed at and is only being distributed to: (A) persons in member states of the European Economic Area who are "qualified investors", as defined in article 2.1(e) of the Prospective Directive (Directive 2003/71/EC) as amended, (B) if in the United Kingdom, persons who (i) have professional experience in matters relating to investments who fall within the definition of "investment professionals" in article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 as amended (the "FPO") or fall within the definition of "high net worth companies, unincorporated associations etc" in article 49(2)(a) to (d) of the FPO and (ii) are "qualified investors" as defined in section 86 of FSMA or (C) persons to whom it may otherwise lawfully be communicated (each, a "Relevant Person"). No other person should act or rely on this announcement and persons distributing this announcement must satisfy themselves that it is lawful to do so. By accepting the terms of this announcement, you represent and agree that you are a Relevant Person.

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 or the Placing relate is available only to Relevant Persons and will be engaged in only with Relevant Persons. As regards all persons other than Relevant Persons, the details of the Placing set out in this announcement are for information purposes only.

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

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 forward-looking statements, which may use words such as "aim", "anticipate", "believe", "could", "intend", "estimate", "expect" and words of similar meaning, include all matters that are not historical facts. These forward-looking statements involve risks, assumptions and uncertainties that could cause the actual results of operations, financial condition, liquidity and dividend policy and the development of the industries in which the Company's businesses operate to differ materially from the impression created by the forward-looking statements. 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. Given those risks and uncertainties, prospective investors are cautioned not to place undue reliance on forward-looking statements. Forward-looking statements speak only as of the date of such statements and, except as required by the FCA, the London Stock Exchange, the AIM Rules or applicable law, the Company undertakes no obligation to update or revise publicly any forward-looking statements, whether as a result of new information, future events or otherwise.

Any indication in this announcement of the price at which the Ordinary Shares have been bought or sold in the past cannot be relied upon as a guide to future performance. Persons needing advice should consult an independent financial adviser. No statement in this announcement is intended to be a profit forecast and no statement in this announcement should be interpreted to mean that earnings per share of the Company for the current or future financial years would necessarily match or exceed the historical published earnings per share of the Company.

Each of Canaccord Genuity and Shore Capital, which are authorised and regulated in the United Kingdom by the FCA, are acting for the Company and for no one else in connection with the Placing and will not be responsible to anyone other than the Company for providing the protections afforded to clients of Canaccord Genuity or Shore Capital or for affording advice in relation to the Placing, or any other matters referred to in this announcement.

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 either Joint Bookrunner or by any of their respective affiliates or either Joint Bookrunner or their respective affiliates' agents, directors, officers and employees 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 therefor is expressly disclaimed.

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

The Appendix to this announcement (which forms part of this announcement) sets out the terms and conditions of the Placing. By participating in the Placing, each person who is invited to and who chooses to participate in the Placing by making an oral and legally binding offer to acquire Placing Shares will be deemed to have read and understood this announcement in its entirety (including the Appendix) and to be making such offer on the terms and subject to the conditions set out in this announcement, and to providing the representations, warranties, undertakings and acknowledgements contained in the Appendix.

Members of the public are not eligible to take part in the Placing and no public offering of securities is or will be made.

Neither the content of the Company's website (or any other website) nor the content of any website accessible from hyperlinks on the Company's website (or any other website) is incorporated into, or forms part of, this announcement.

1) Introduction

Vision for growth

Stride Gaming's vision is to become the global market leader in the soft gaming vertical of the online gaming industry. Stride Gaming has an ambitious and progressive growth strategy to build on the Group's robust performance since listing on AIM in 2015. Its growth strategy remains centred on six core pillars:

· continue to build scale through strong organic growth and targeted acquisitions;

· expand presence in existing verticals both in the UK and international regulated markets;

· enter into other soft gaming verticals such as lottery and scratch cards;

· take advantage of operational leverage through scale and significant consolidation opportunities;

· increase market share of the UK online bingo market to 15-20 per cent.; and

· continue to increase profitability and scale.

UK online bingo market overview

The UK online gaming market is estimated to pass £3 billion by 2016, with the UK online bingo market expected to reach approximately £600 million in 20161. The UK online bingo market is dominated by four large operators, which have a combined market share of approximately 57 per cent. Stride Gaming is estimated to be ranked as the sixth largest bingo operator, with approximately 5 per cent. of the market(1). Online bingo has continued to grow in popularity in the UK, with UK online bingo-led NGR estimated to grow by 35.4 per cent. between 2011 and 2016.

Regulatory changes to real money gambling in the UK now requires operators to be licensed by the UK Gambling Commission, with these operators incurring a 15 per cent. PoC tax on NGR related to UK based players. The Directors believe that the current PoC tax, compliance and new technological standards will continue to drive sector consolidation, squeezing out smaller operators who have lower margins, providing an opportunity for a scale gaming operator, such as the Group, to increase its market share.

Larger operators also face challenges, with these operators being forced to prioritise their marketing spend to their core non-bingo led products. Furthermore, Stride Gaming expects that the expansion of the scope of the PoC tax in August 2017, will continue to drive sector consolidation, leaving Stride Gaming with a greater opportunity to increase its market share.

(1) Source: Gambling Compliance Report 2015

Transaction rationale

The Acquisitions are in line with the Company's strategy and vision set out above; to maximise shareholder value by achieving growth through organic and acquisitive means.

The Acquisitions bring scale and a number of leading Bingo brands to Stride Gaming. Stride Gaming's UK online bingo market share is expected to rise from 5 per cent. to 10 per cent. with these Acquisitions, which would make Stride Gaming the fourth largest online bingo operator in the UK market. Furthermore, Stride Gaming's share of the UK online bingo landscape is expected to rise from 2 per cent. to over 25 per cent. following completion of the Acquisitions (by number of sites).

The Acquisitions present attractive player fundamentals which are expected to deliver further upside through leveraging Stride Gaming's leading platform and marketing expertise, whilst also driving synergies through cross marketing, lowering of CPA, increasing customer LTV and reducing player churn. The following table sets out selected KPIs for Stride Gaming, 8Ball and Tarco:

(1) Average life time value of a player - Stride Gaming (NGR), Tarco, 8Ball (net cash). Stride Gaming data analysed since inception; Tarco 20 months to June 2016; 8Ball average of rolling 12 months forward from January, February, March 2015 respectively

(2) Yield per player per month - Stride Gaming (NGR), Tarco, 8Ball (net cash). Stride Gaming, Tarco March - May 2016; 8Ball LTM May 2016

(3) Cost per Acquisition - Stride Gaming LTM June 2016; Tarco January - May 2016; 8Ball LTM April 2016

The Directors believe that the Group can achieve cost synergies (including marketing, administration, distribution costs) of an estimated aggregate £2.5 million (post earn out) and revenue synergies (including LTV, yield and net cash hold) of an estimated aggregate £3.0 million (post earn out) through the Acquisitions.

The Acquisitions, in aggregate, are expected to be accretive in the first full year of ownership, prior to any synergies.

The Tarco Assets and Netboost Media:

• Provide scale: estimated market share is three per cent.

• Expand the Group's multi-branded offering by 22 brands

• Bring expertise in operating the Dragonfish platform

8Ball:

• Provides scale: estimated market share is two per cent.

• Expands the Group's multi-branded offering by 74 brands

• Adds proven cross marketing BI to achieve low CPA levels

• Brings expertise in operating multi brands and multi platforms

• Is highly ranked for SEO (Booty Bingo is in top five search results for 'online bingo')

2) Summary of the Acquisitions

Acquisition of Tarco Assets and Netboost Media

DAL and Spacebar, being wholly owned subsidiaries of the Company have, respectively, conditionally agreed to acquire the Tarco Assets and the entire issued share capital of Netboost Media, a marketing business which services the Tarco Assets, for a total consideration of up to £40.2 million, comprising:

· an initial consideration of £16.0 million (on a debt free, cash free basis) for the Tarco Assets, of which £7.7 million will be paid in cash and the balance satisfied by the issue of 3,219,500 new Ordinary Shares;

· the number of Tarco Initial Consideration Shares was calculated by reference to the average closing price of the Ordinary Shares for the 90 day period ending on 28 July 2016 (the "Average Initial Share Price");

· an earn out consideration of up to £22.0 million for the Tarco Assets, equal to 7.5x adjusted EBITDA for the 12 month period to 31 December 2017, less the initial consideration, of which 51.4 per cent. will be paid in cash and the balance (48.6 per cent.) satisfied by the issue of the Tarco Earn Out Consideration Shares; and

· the number of Tarco Earn Out Consideration Shares to be issued (if any) is to be calculated by reference to the average closing price of the Ordinary Shares for the 90 day period ending on 31 December 2017, provided always that the reference price shall not be more than 20 per cent. higher or lower than the Average Initial Share Price such that the maximum number of new Ordinary Shares that could be issued to satisfy any such earn out consideration is 5,196,029 new Ordinary Shares;

· a consideration of £2.2 million for Netboost, payable in cash on completion of the Netboost Media Acquisition.

Subject to certain limited exceptions, from the date of the issue of the Tarco Initial Consideration Shares until 31 December 2017, the Tarco (GAL) Transferees and the Black Onyx Partners will not dispose of the Tarco Initial Consideration Shares, except with the prior written consent of the Company and (for so long as Canaccord Genuity and Shore Capital remain the nominated adviser and/or broker of the Company) Canaccord Genuity and Shore Capital. In addition, any disposal of the Tarco Earn Out Consideration Shares from the date of the issue of such shares until 31 March 2018 (subject to certain exceptions) must be made through Canaccord Genuity or Shore Capital with a view to maintaining an orderly market in the Ordinary Shares.

Tarco is an independent online bingo operator with approximately three per cent. share of the UK online bingo market and has approximately 63,000 monthly active players. Tarco has 22 B2C bingo brands and 4 B2B, including Moon Bingo, Robin Hood Bingo and Moon Games. Tarco operates on 888's Dragonfish platform. Black Onyx owns 50 per cent. of the shares in Tarco with the remaining 50 per cent. beneficially owned by the Tarco (GAL) Shareholders as set out below:

(1) Legal title to these shares is held by Guardian Trust Company Limited as trustee for the Alon Trust. The beneficiaries of the Alon Trust are Eitan Boyd, his wife and children.

(2) Legal title to these shares is held by Clermont Corporate Services Limited in its capacity as trustee for the Monkey George Trust. The beneficiaries of the Monkey George Trust are Darren Sims, his wife and children.

(3) Ultimately owned by Rubin Feldman, the father of Alan Feldman (a consultant to Group companies).

(4) Legal title to these shares is held by Geneva Management Group.

Pursuant to the terms of the Tarco Acquisition and taking into account the Tarco Transfers, the mix of cash and new Ordinary Shares payable as part of Tarco Initial Consideration and Tarco Earn Out Consideration is as follows:

Netboost Media is a marketing business which services the Tarco Assets. 50 per cent. of the shares in Netboost Media are being acquired from the Black Onyx Partners with the remaining 50 per cent. being acquired from GAL Holdings. Netboost Media is based in Israel in offices which are leased by Netboost Media from Pipeline Capital Limited, a company jointly controlled by GAL Holdings and Black Onyx. These lease arrangements will continue following completion of the Netboost Media Acquisition. Assaf Matityahu, Netboost Media's Co-CEO will be employed by the enlarged Group for at least two years following the end of the earn out period under the Tarco Acquisition (being 31 December 2017) and, in connection with such arrangements, will be granted options over 77,822 new Ordinary Shares (exercisable at the Average Initial Share Price) which will vest, as to 38,911 new Ordinary Shares on 31 December 2018 with the remaining 38,911 vesting on 31 December 2019.

Summary financial information and KPIs for the Tarco Assets and Netboost Media are set out below:

(1) Audited accounts, converted to IFRS

(2) Management accounts, converted to IFRS

(3) Net cash hold: LTM May 2016; LTV: 20 months to June 2016; CPA: January - May 2016; Active Players: March - May 2016

Acquisition of 8Ball

The Company has conditionally agreed to acquire the entire issued share capital of 8Ball for a total consideration of up to £30.0 million, comprising of:

• an initial consideration of £12.0 million (on a debt free, cash free basis), payable in cash on completion of the 8Ball Acquisition;

• an earn out consideration of up to £18.0 million, equal to 6x adjusted EBITDA for the 12 month period following completion of the 8Ball Acquisition, less the initial consideration, of which the first £3.0 million will be satisfied in new Ordinary Shares with the balance paid as to 40 per cent. in cash and 60 per cent. to be satisfied by the issue of new Ordinary Shares;

· the number of 8Ball Earn Out Consideration Shares to be issued (if any) is to be calculated as follows:

o the first £4.0 million will be satisfied by the issue of new Ordinary Shares calculated by reference to the Placing Price;

o the balance of any further earn out consideration to be satisfied by the issue of new Ordinary Shares will be calculated by reference to the average closing price of the Ordinary Shares for the 90 day period ending on 31 August 2017 (being the end of the earn out period for the 8Ball Acquisition) provided always that such reference price shall not be more than 20 per cent. higher or lower than the Average Initial Share Price such that the maximum number of new Ordinary Shares that could be issued to satisfy any such earn out consideration is 5,668,829 new Ordinary Shares.

Subject to certain limited exceptions, for a period of twelve months ending on 31 August 2018 (the "Initial Lock-In Period"), the 8Ball Sellers will not dispose of the 8Ball Earn Out Consideration Shares (or any interest therein) except with the prior written consent of the Company and (for so long as Canaccord Genuity and Shore Capital remain the nominated adviser and/or broker of the Company) Canaccord Genuity and Shore Capital.

In addition, any disposal of the 8Ball Earn Out Consideration Shares in the six months following the expiry of the Initial Lock-In Period will (subject to certain exceptions) be made through Canaccord Genuity or Shore Capital with a view to maintaining an orderly market in the Ordinary Shares.

8Ball is an online bingo operator, with a total of 74 sites in the UK, including Booty Bingo and WeWantBingo. 8Ball operates a multi-platform multi brand strategy, acquiring the lower end of the market. 8Ball has over 60,000 active players, and its propriety BI platform enables it to maximise player value using cross marketing techniques. 8Ball has 30 employees in the UK across brand management and marketing (including retention), outsourcing most other services to the various platform providers. The operations director of the 8Ball business will be employed in the enlarged Group for at least two years post completion. 8Ball is owned by the 8Ball Shareholders, who are its current management team.

Summary financial information and KPIs for 8Ball are set out below:

(1) Unaudited accounts, converted to IFRS

(2) Management accounts, converted to IFRS

(3) Net cash hold: March to May 2016; LTV: average of rolling 12 months forward from January, February, March 2015 respectively; CPA: LTM April 2016; Active Players: March to May 2016

Pro forma financial information

The pro forma financial information set out below is based on unaudited management accounts.

LTM May 2016 NGR bridge1

LTM May 2016 Adjusted EBITDA bridge2

(1) NGR for the 12 months period ending 31 May 2016 based on management accounts (excludes potential synergies)

(2) Adjusted EBITDA for the 12 months period ending 31 May 2016 based on management accounts (excludes potential synergies)

NGR and EBITDA figures are without potential synergies

3) Details of the Placing

The Company is proposing to raise gross proceeds of £27.0 million (£25.1 million net of expenses) through the issue of the Placing Shares at the Placing Price to Placees to be procured by the Joint Bookrunners pursuant to the Placing Agreement (further details of which are set out below). The Placing Price of 225 pence is equivalent to a discount of approximately 12 per cent. to the average closing price of the Ordinary Shares for the 90 day period ending on 28 July 2016. The Placing Shares will represent approximately 19 per cent. of the Enlarged Share Capital on Admission.

The Placing Shares will be allotted and issued fully paid and will, on issue, rank pari passu with the Existing Ordinary Shares including the right to receive, in full, all dividends and other distributions declared, paid or made thereafter in respect of the Ordinary Shares together with all rights attaching to them and free from all liens, charges and encumbrances of any kind. Application will be made for the Placing Shares to be admitted to trading on AIM. It is expected that Admission and dealings in the Placing Shares will commence at 8.00 a.m. on or around 23 August 2016.

The Placing Shares are not being made available to the public and none of the Placing Shares are being offered or sold in any jurisdiction where it would be unlawful to do so. The Placing Shares have not been and will not be registered under the relevant laws of any of the Restricted Jurisdictions or any state, province or territory thereof and may not be offered, sold, resold, delivered or distributed, directly or indirectly in or into any Restricted Jurisdiction or to, or for the account or benefit of, any person with a registered address in, or who is a resident of or ordinarily resident in, or a citizen of, any Restricted Jurisdiction except pursuant to an applicable exemption.

Whilst the Acquisitions and the Placing are each conditional upon, amongst other things, the passing of the Resolutions at the General Meeting, the Acquisitions are also conditional on a number of other matters and are, therefore, expected to complete after Admission. As such, the Placing is not conditional upon completion of the Acquisitions and there is, therefore, a possibility that the Placing Shares might be issued but that none (or not all) of the Acquisitions will complete. In these circumstances, the Directors would consider the Company's options with regard to how best to utilise the net proceeds of the Placing.

4) Placing Agreement

Pursuant to the terms of the Placing Agreement, the Joint Bookrunners have agreed to use their respective reasonable endeavours, as agents of the Company, to procure Placees for the Placing Shares. The obligations of the Joint Bookrunners are conditional upon, amongst other things: (a) the Resolutions being passed at the General Meeting; and (b) Admission taking place not later than 8.00 a.m. on or around 31 August 2016 (or such later time and date as the Joint Bookrunners and the Company may agree, being not later than 8.00 a.m. on 7 September 2016.

The Joint Bookrunners are entitled to terminate their respective obligations under the Placing Agreement if, amongst other things, at any time before Admission: (a) there is a material adverse change in the business, management, operations, assets, liabilities (financial, trading or otherwise) or profits of the Group (in the opinion of a Joint Bookrunner, acting in good faith); (b) the Joint Bookrunners become aware that any of the warranties given by the Company in the Placing Agreement was untrue, inaccurate or misleading in any material respect when made and/or would be untrue, inaccurate or misleading in any material respect if repeated at any time prior to Admission; (c) the Company is in material breach of any of its obligations under the Placing Agreement; or (d) certain force majeure events occur which in the opinion of the Joint Bookrunners, acting in good faith, would make it inadvisable or impracticable to proceed with the Placing.

5) Current trading and prospects

The Group continues to be cash generative and achieved a cash conversion rate of 90 per cent. in the nine months to 31 May 2016, with the Group generating approximately £4 million in gross revenue per month during the last twelve months to 31 May 2016.

The Group is highly confident in results for the full year ending 31 August 2016.

6) LTIP Awards

As set out in the Company's interim results, the Company will shortly adopt an annual LTIP for the executive directors. It will be in a form of performance shares, with a three year vesting period, subject to stretching performance conditions set at the time of grant, which include metrics based on financial performance in line with the key objectives of delivering returns to its shareholders through achievement of the Group's growth strategy and continued service. The initial award of performance shares are expected to be made at a maximum aggregate value of £650,000 for each of the 2015/16 and 2016/17 financial years.

7) Rule 9 of the Takeover Code and background to the Rule 9 Waiver

The issue of the Tarco Consideration Shares (and the related Tarco Transfers), the proposed grant of the Matityahu Options and the LTIP Awards and the subsequent issue of the Matityahu Shares (if any) and the LTIP Shares (if any) and the issue of the Consultant Shares (described below) each give rise to certain considerations and consequences under the Takeover Code. Brief details of the Panel, the Takeover Code and the protections they afford are described below.

Rule 9 of the Takeover Code

The Company is incorporated in Jersey and its Ordinary Shares are admitted to trading on AIM. Accordingly, the Takeover Code applies to the Company.

Under Rule 9 of the Takeover Code, any person who acquires an interest (as defined in the Takeover Code) in shares which (taken together with shares in which he is already interested and in which persons acting in concert with him are interested) carry 30 per cent. or more of the voting rights of a company which is subject to the Takeover Code, is normally required to make a general offer to all of the remaining shareholders to acquire their shares.

Rule 9 of the Takeover Code also provides, inter alia, that where any person, together with any persons acting in concert with him, is interested in shares carrying not less than 30 per cent. but not more than 50 per cent. of a company's voting rights, a general offer will normally be required if any further interest in shares is acquired by any such person. The Panel will also deem an obligation to make an offer to have arisen under Rule 9 on the acquisition by a single member of a concert party of an interest in shares carrying 30 per cent. or more of a company's voting rights, or, if he already holds more than 30 per cent. but not more than 50 per cent., an acquisition which increases his percentage holding of interests in shares in that company.

An offer under Rule 9 of the Takeover Code must be made in cash and at the highest price paid by the person required to make the offer (or any persons acting in concert with him) for any such shares within the 12 months prior to the announcement of the offer.

For the purposes of the Takeover Code, a concert party arises where persons acting in concert pursuant to an agreement or understanding (whether formal or informal) actively co-operate, to obtain or consolidate control of that company. Control means a holding, or aggregate holdings, of interests in shares carrying in aggregate 30 per cent. or more of the voting rights (as defined in the Takeover Code), irrespective of whether the holding or holdings give de facto control.

Original GAL Concert Party

Stride Gaming was admitted to AIM on 19 May 2015 ("AIM Admission"). There are currently two defined concert parties in existence in relation to the Company for the purposes of the Takeover Code, being (1) the Original GAL Concert Party and (2) the TTE Concert Party. The Tarco (GAL) Shareholders form part of the Original GAL Concert Party.

On AIM Admission, members of the Original GAL Concert Party held, in aggregate, 31,202,103 Ordinary Shares, representing approximately 62.2 per cent. of the issued share capital of the Company on AIM Admission. Similarly, the TTE Concert Party held in aggregate, 10,464,562 Ordinary Shares, representing approximately 20.9 per cent. of the issued share capital of the Company on AIM Admission. In addition, certain members of the Original GAL Concert Party had been granted the Approved Options over, in aggregate, 3,000,000 Ordinary Shares which, if exercised in full, would result in members of the GAL Concert Party holding, in aggregate, approximately 64.3 per cent. of the issued share capital following the exercise of those options. The Approved Options were issued prior to AIM Admission and the Panel has previously confirmed that the issue of any Ordinary Shares to such members of the Original GAL Concert Party upon the exercise of those options would not result in any member of the Original GAL Concert Party incurring an obligation to make an offer under Rule 9 of the Takeover Code.

At the time of AIM Admission, the TTE Share Transfer Agreement was entered into between certain members of the Original GAL Concert Party and certain members of the TTE Concert Party whereby those members of the Original GAL Concert Party agreed to transfer Ordinary Shares in Stride to those members of the TTE Concert Party depending upon certain performance criteria being met for the 12 month periods ending 4 September 2015 and 4 September 2016 respectively. The Panel has previously confirmed that the transfer of these Ordinary Shares to members of the TTE Concert Party would not result in any member of the TTE Concert Party incurring an obligation to make an offer under Rule 9 of the Takeover Code.

On 30 September 2015, the Company announced that the performance criteria for the first 12 month period ending 4 September 2015 had been met such that on 18 June 2016, certain members of the Original GAL Concert Party transferred, in aggregate, 9,610,224 Ordinary Shares to certain members of the TTE Concert Party. As a result of this transfer, the holdings of the two concert parties are as follows: (1) the Original GAL Concert Party holds, in aggregate, 21,616,879 Ordinary Shares, representing approximately 42.14 per cent. of the voting rights in the Company and (2) the TTE Concert Party holds, in aggregate, 21,223,857 Ordinary Shares, representing approximately 41.37 per cent. of the voting rights in the Company.

If the performance criteria under the terms of the TTE Share Transfer Agreement for the 12 month period ending 4 September 2016 are met, certain members of the Original GAL Concert Party will be required to transfer up to, in aggregate, 2,841,880 Ordinary Shares (representing 5.5 per cent. of the Existing Ordinary Shares) to certain members of the TTE Concert Party.

Enlarged GAL Concert Party

As certain members of the Original GAL Concert Party are shareholders of Tarco, they have been deemed to be acting in concert with each of Black Onyx and the Black Onyx Partners (the Tarco Transferees and the Black Onyx Partners being the ultimate recipients of the Tarco Consideration Shares pursuant to the Tarco Transfers) for the purposes of the Takeover Code and accordingly, subject to completion of the Tarco Acquisition, the Original GAL Concert Party has been extended to include such persons who become members of the Enlarged GAL Concert Party.

Tarco Acquisition

Pursuant to the terms of the Tarco Acquisition, the Tarco Initial Consideration Shares received by Tarco at completion of the Tarco Acquisition (and any Tarco Earn Out Consideration Shares issued by the Company to Tarco) will be transferred to the Tarco Transferees immediately following their issue. The Tarco Initial Consideration Shares (and any Tarco Earn Out Consideration Shares issued by the Company to Tarco) transferred to Black Onyx will then immediately be transferred to the Black Onyx Partners.

Each time any such Tarco Consideration Shares are issued to Tarco (and subsequently transferred as described above) and assuming that there are: (i) no sales of Ordinary Shares by the Enlarged GAL Concert Party; and (ii) no other changes to the Company's issued share capital, the members of the Enlarged GAL Concert Party will have increased their aggregate holdings in the voting rights of the Company which, without a waiver of the obligations under Rule 9, would require a member (or members) of the Enlarged GAL Concert Party to make a Rule 9 Offer for the Company.

As at 28 July 2016 (being the latest practicable date prior to the publication of this announcement), the Original GAL Concert Party held approximately 42.14 per cent. of the Ordinary Share Capital and Black Onyx and the Black Onyx Partners together held approximately 0.01 per cent of the Ordinary Share Capital.

Following Admission and the issue of the Tarco Initial Consideration Shares, the expected aggregate interests of the Enlarged GAL Concert Party in the Ordinary Share Capital will be 37.34 per cent.

If, in addition, all of the Tarco Earn Out Consideration Shares are issued by the Company as part of the earn out consideration payable in connection with the Tarco Acquisition and assuming that (i) the Approved Options are not exercised; (ii) no other new Ordinary Shares are issued by the Company; and (iii) no Ordinary Shares are transferred by the relevant members of the Enlarged GAL Concert Party to persons who are not members of the Enlarged GAL Concert Party (including those which may be transferred pursuant to the TTE Share Transfer Agreement), the expected aggregate interests of the Enlarged GAL Concert Party in the Ordinary Share Capital will be 41.88 per cent.

Matityahu Options

In connection with the Netboost Media Acquisition, Assaf Matityahu, Netboost's CEO will be employed by the enlarged Group for at least two years following the end of the earn out period under the Tarco Acquisition (being 31 December 2017). As part of the arrangements being entered into in relation to the Tarco Acquisition and the Netboost Media Acquisition, Assaf Matityahu will be granted options over a total of 77,822 new Ordinary Shares exercisable at the Average Initial Share Price which will vest, as to 38,911 new Ordinary Shares on 31 December 2018 with the remaining 38,911 vesting on 31 December 2019.

Each time any such Matityahu Shares are issued to Assaf Matityahu and assuming that: (i) no Ordinary Shares are transferred by the relevant members of the Enlarged GAL Concert Party to persons who are not members of the Enlarged GAL Concert Party (including those which may be transferred pursuant to the TTE Share Transfer Agreement); and (ii) no other changes to the Company's issued share capital, the Enlarged GAL Concert Party as a whole will have increased its interest in the voting rights of the Company which, without a waiver of the obligations under Rule 9, would require a member (or members) of the Enlarged GAL Concert Party to make a Rule 9 Offer for the Company.

Consultant Options

On 1 October 2015, Izak Cronje, a consultant to the Group, was granted options over 500,000 new Ordinary Shares at an exercise price of 132 pence. These options will vest as to one third on each of 1 October 2017, 1 October 2018 and 1 October 2019.

In addition, on 1 October 2015, Sandra Cronje, wife of Izak Cronje and a consultant to the Group, was granted options over 20,000 new Ordinary Shares at an exercise price of 132 pence. These options will vest as to one third on 1 October 2017 with the remaining two thirds vesting on 1 October 2018.

As Mr Cronje is also a director of GAL Holdings, he and Mrs Cronje become members of the Enlarged GAL Concert Party by virtue of the receipt of the Consultant Options. At the time the Consultant Options were issued, the Original GAL Concert Party held over 50 per cent. of the voting rights of the Company meaning that the issue of any Consultant Shares upon exercise of the Consultant Options, whilst increasing the interest of the Original GAL Concert Party in the voting rights of the Company, would not require a member (or members) of the Enlarged GAL Concert Party to make a Rule 9 Offer for the Company. However, following the transfer of Ordinary Shares between the Original GAL Concert Party and the TTE Concert Party in connection with the arrangements set out in the TTE Share Transfer Agreement, each time any Consultant Shares are issued to either Izak Cronje or Sandra Cronje and assuming that: (i) no Ordinary Shares are transferred by the relevant members of the Enlarged GAL Concert Party to persons who are not members of the Enlarged GAL Concert Party (including those which may be transferred pursuant to the TTE Share Transfer Agreement); and (ii) there are no other changes to the Company's issued share capital, the Enlarged GAL Concert Party as a whole will have increased its interest in the voting rights of the Company which, without a waiver of the obligations under Rule 9, would require a member (or members) of the Enlarged GAL Concert Party to make a Rule 9 Offer for the Company.

LTIP Shares

As contemplated above, the Company proposes to grant awards of a value equivalent to up to £650,000 for each of the 2015/16 and 2016/17 financial years to Eitan Boyd, Darren Sims and Ronen Kannor, the executive directors of the Company (each of whom is also a member of the Original GAL Concert Party). The total number of the LTIP Awards granted each year would be capped at 316,147 new Ordinary Shares (with maximum annual LTIP Awards over 121,595 new Ordinary Shares being granted to each of Eitan Boyd and Darren Sims and maximum annual LTIP Awards over 72,957 new Ordinary Shares being granted to Ronen Kannor). In aggregate, the maximum number of new Ordinary Shares which may be issued to Eitan Boyd, Darren Sims and Ronen Kannor pursuant to the LTIP Awards will be 632,294.

Each time any LTIP Shares are issued to Eitan Boyd, Darren Sims and Ronen Kannor, and assuming that: (i) no Ordinary Shares are transferred by the relevant members of the Enlarged GAL Concert Party to persons who are not members of the Enlarged GAL Concert Party (including those which may be transferred pursuant to the TTE Share Transfer Agreement); and (ii) there are no other changes to the Company's issued share capital, the Enlarged GAL Concert Party as a whole will have increased its interest in the voting rights of the Company which, without a waiver of the obligations under Rule 9, would require a member (or members) of the Enlarged GAL Concert Party to make a Rule 9 Offer for the Company.

Maximum Enlarged GAL Concert Party holding of Ordinary Shares

If (i) all of the Tarco Earn Out Consideration Shares are issued by the Company as part of the earn out consideration payable in connection with the Tarco Acquisition; (ii) all of the Matityahu Shares are issued by the Company following the exercise of the Matityahu Options; (iii) all of the Consultant Shares are issued by the Company following the exercise of the Consultant Options; and (iv) all of the LTIP Shares are issued by the Company following the exercise of the LTIP Awards, the expected aggregate interest of the Enlarged GAL Concert Party will be 42.86 per cent. of the voting rights of the Company (assuming that (i) the Approved Options are not exercised; (ii) the maximum number of the Placing Shares are issued pursuant to the Placing; (iii) no other new Ordinary Shares are issued by the Company (including pursuant to the 8Ball Acquisition); and (iv) no Ordinary Shares are transferred by the relevant members of the Enlarged GAL Concert Party to persons who are not members of the Enlarged GAL Concert Party (including those which may be transferred pursuant to the TTE Share Transfer Agreement)).

In circumstances where all of the Approved Options are also exercised, the expected aggregate interest of the Enlarged GAL Concert Party will increase to 45.12 per cent. of the voting rights of the Company (assuming that: (i) the maximum number of Placing Shares are issued pursuant to the Placing; (ii) no other new Ordinary Shares are issued by the Company; and (iii) no Ordinary Shares are transferred by the relevant members of the Enlarged GAL Concert Party to persons who are not members of the Enlarged GAL Concert Party (including those which may be transferred pursuant to the TTE Share Transfer Agreement)).

In circumstances where the Acquisitions do not complete and: (i) all of the LTIP Shares are issued by the Company following the exercise of the LTIP Awards; and (ii) all of the Approved Options are also exercised, the expected aggregate interest of the Original GAL Concert Party will be 37.72 per cent. of the voting rights of the Company (assuming that: (i) the maximum number of the Placing Shares are issued pursuant to the Placing; (ii) the Consultant Options are not exercised; (iii) no other new Ordinary Shares are issued by the Company; and (iv) no Ordinary Shares are transferred by the relevant members of the Original GAL Concert Party to persons who are not members of the Original GAL Concert Party (including those which may be transferred pursuant to the TTE Share Transfer Agreement)).

In circumstances where the Acquisitions do not complete and: (i) all of the LTIP Shares are issued by the Company following the exercise of the LTIP Awards; (ii) all of the Consultant Shares are issued by the Company following the exercise of the Consultant Options; and (iii) all of the Approved Options are also exercised, the expected aggregate interest of the Original GAL Concert Party will be 38.20 per cent. of the voting rights of the Company (assuming that: (i) the maximum number of the Placing Shares are issued pursuant to the Placing; (ii) no other new Ordinary Shares are issued by the Company; and (iii) no Ordinary Shares are transferred by the relevant members of the Original GAL Concert Party to persons who are not members of the Original GAL Concert Party (including those which may be transferred pursuant to the TTE Share Transfer Agreement)).

Enlarged GAL Concert Party Interests in Stride Gaming shares

The current interest of the members of the Enlarged GAL Concert Party together with their maximum expected shareholdings following: (i) completion of the Placing and the Tarco Acquisition; (ii) the issue of the Tarco Earn Out Consideration Shares (if any); and (iii) the issue of Ordinary Shares pursuant to the Approved Options; and (iv) the issue of the LTIP Shares (if any) (and assuming (i) no additional issues of Ordinary Shares including pursuant to the 8Ball Acquisition; and (b) no transfers of Ordinary Shares by members of the Enlarged GAL Concert Party (including pursuant to the TTE Share Transfer Agreement) are set out below:

1. Legal title to these shares is held by Guardian Trust Company Limited as trustee for the Alon Trust. The beneficiaries of the Alon Trust are Eitan Boyd, his wife and children.

2. Legal title to these shares is held by Clermont Corporate Services Limited in its capacity as trustee for the Monkey George Trust. The beneficiaries of the Monkey George Trust are Darren Sims, his wife and children.

3. Ultimately owned by Rubin Feldman, the father of Alan Feldman (a consultant to Group companies).

4. Of these shares, 25,000 are held by Christo Oosthuizen in his own name and for the remainder, the legal title is held by Geneva Management Group (BVI) Limited.

This table above assumes that none of the Approved Options are exercised but that the maximum number of Placing Shares are issued pursuant to the Placing and the maximum number of Tarco Consideration Shares are issued pursuant to the Tarco Acquisition. In circumstances where all of the Approved Options are also exercised, the expected aggregate interest of the Enlarged GAL Concert Party will increase from 42.86 per cent. to 45.12 per cent. of the voting rights of the Company (assuming that: (i) the maximum number of Placing Shares are issued pursuant to the Placing; (ii) the Matityahu Shares are issued, (iii) the Consultant Shares are issued, (iv) the maximum LTIP Shares are issued; (v) no other new Ordinary Shares are issued by the Company; and (vi) no Ordinary Shares are transferred by the relevant members of the Enlarged GAL Concert Party to persons who are not members of the Enlarged GAL Concert Party (including those which may be transferred pursuant to the TTE Share Transfer Agreement)).

Rule 9 Waiver

The Panel has agreed, however, to waive the obligation on the members of the Enlarged GAL Concert Party to make a general offer that would otherwise arise as a result of the increased holding of interests in Ordinary Shares following the issue of the Tarco Consideration Shares (and the related Tarco Transfers), the issue of the Matityahu Shares (if any), the issue of the Consultant Shares (if any) and the issue of the LTIP Shares (if any), provided the approval, on a poll, of the Independent Shareholders is obtained at the General Meeting. Accordingly, the Waiver Resolution is being proposed at the General Meeting and will be taken on a poll. No member of the Enlarged GAL Concert Party will be entitled to vote on the Waiver Resolution.

For the avoidance of doubt, the Rule 9 Waiver applies only in respect of the increase in holdings of Ordinary Shares by members of the Enlarged GAL Concert Party resulting from (i) the issue of the Tarco Consideration Shares (and the related Tarco Transfers), (ii) the issue of the Matityahu Shares (if any), (iii) the issue of the Consultant Shares (if any) and (iv) the issue of the LTIP Shares (if any) and not in respect of other increases in their respective holdings (although the Panel has previously confirmed that the issue of any Ordinary Shares to certain members of the Original GAL Concert Party upon the exercise of the Approved Options would not result in any member of the Original GAL Concert Party incurring an obligation to make an offer under Rule 9 of the Takeover Code). No member of the Enlarged GAL Concert Party has taken part in any decision of the Board relating to the proposal to seek the Rule 9 Waiver.

In the event that the Waiver Resolution is passed by Independent Shareholders, the Enlarged GAL Concert Party will not be restricted from making an offer for the Company.

8) Related Party Transaction

As at 28 July 2016 (being the latest practicable date prior to the publication of this announcement), GAL Holdings holds 16,868,743 Existing Ordinary Shares, representing approximately 32.88 per cent. of the issued share capital of the Company. GAL Holdings also holds 37.50 per cent. of the issued share capital of Tarco and is selling 50.00 per cent of the issued share capital of Netboost Media and, as a substantial shareholder of the Company under the AIM Rules, the Tarco Acquisition and the Netboost Media Acquisition each constitutes a related party transaction with GAL Holdings under Rule 13 of the AIM Rules.

In addition, Eitan Boyd and Darren Sims each have an interest in the Tarco Acquisition as described above and are due to receive consideration under the Tarco Acquisition (including new Ordinary Shares). As both Eitan Boyd and Darren Sims are directors of the Company, the Tarco Acquisition constitute a related party transaction with each of them under Rule 13 of the AIM Rules.

The Independent Directors consider, having consulted the Company's Nominated Adviser, Canaccord Genuity, that the terms of the Tarco Acquisition and the Netboost Media Acquisition are fair and reasonable insofar as Shareholders are concerned. In providing advice to the Independent Directors, Canaccord Genuity has taken account of the commercial assessments of the Directors.

9) Directors Dealing

On completion of the Tarco Acquisition, (i) Guardian Trust Company Limited as trustee for the Alon Trust (of which the beneficiaries are Eitan Boyd, Chief Executive Officer of the Company, and his wife and children) and (ii) Clement Corporate Services Limited in its capacity as trustee of the Monkey George Trust (of which the beneficiaries are Darren Sims, Chief Operating Officer of the Company, and his wife and children), each being shareholders of Tarco, will receive 175,214 and 146,012 Tarco Initial Consideration Shares respectively pursuant to the Tarco Transfers. As set out above, the number of Tarco Initial Consideration Shares was calculated by reference to the average closing price of the Ordinary Shares for the 90 day period ending on 28 July 2016.

10) General Meeting

A notice convening the General Meeting will be set out in the end of the Circular to be posted to Shareholders on or around 3 August 2016. The business to be considered at the General Meeting will be set out in the notice together with the explanatory notes to the Resolutions.

11) Irrevocable Undertakings

The Company has received irrevocable undertakings from each of Poppy Investments Limited, Hydaco Holdings Pty Ltd as trustees of Hydaco Holdings Trust, Bedell Trustees Limited as trustees of the Blue Rock Trust, Bedell Trustees Limited as trustees of the Eagle Eye Trust and SMD Development NV to vote in favour of the Resolutions in respect of each of their own shareholdings in the Company. This represents 71.51 per cent. of the Ordinary Share Capital eligible to vote on the Waiver Resolution and 41.37 per cent. of the Ordinary Share Capital eligible to vote on the other two resolutions.

In addition, each member of the Enlarged GAL Concert Party eligible to vote on the Waiver Resolution has irrevocably undertaken to the Company not to vote (and to take all reasonable steps to ensure that none of their associates will vote) on the Waiver Resolution and has otherwise irrevocably undertaken to vote in favour of the other two resolutions in respect of each of their own shareholdings in the Company; this represents 42.14 per cent. of the Ordinary Share Capital eligible to vote on such resolutions.

12) Recommendation

The Independent Directors have received financial advice from Canaccord Genuity in relation to the Rule 9 Waiver. The Independent Directors, having been so advised by Canaccord Genuity, consider, taken together, the Placing, the Acquisitions, the grant of the Matityahu Options, the grant of the LTIP Awards and the Rule 9 Waiver to be fair and reasonable as far as the Independent Shareholders are concerned and in the best interests of Company and the Independent Shareholders as a whole. In providing its financial advice to the Independent Directors, Canaccord Genuity has taken into account the Independent Directors' commercial assessments.

The Independent Directors therefore unanimously recommend that Shareholders vote in favour of the Resolutions like they have irrevocably undertaken to so do in respect of each of their own shareholdings in the Company representing 0.13 per cent. of the Ordinary Share Capital.

KEY STATISTICS REGARDING THE PLACING

EXPECTED TIMETABLE OF PRINCIPAL EVENTS

Each of the times and dates in the above timetable is subject to change. If any of the above times and/or dates change, the revised times and/or dates will be notified to Shareholders by announcement through a Regulatory Information Service. References to time in this announcement are to British Summer Time. The timetable above assumes that the Resolutions are passed at the General Meeting without adjournment.

DEFINITIONS

The following definitions apply throughout this announcement unless the context requires otherwise:

GLOSSARY

The following glossary of terms apply throughout this announcement unless the context requires otherwise:

APPENDIX - TERMS AND CONDITIONS OF THE PLACING

IMPORTANT INFORMATION FOR PLACEES ONLY

MEMBERS OF THE PUBLIC ARE NOT ELIGIBLE TO TAKE PART IN THE PLACING AND NO PUBLIC OFFERING OF SECURITIES WILL BE MADE. THIS ANNOUNCEMENT AND THE TERMS AND CONDITIONS SET OUT AND REFERRED TO IN IT ARE DIRECTED ONLY AT PERSONS SELECTED BY CANACCORD GENUITY LIMITED ("CANACCORD GENUITY") AND/OR SHORE CAPITAL STOCKBROKERS LIMITED ("SHORE CAPITAL" AND TOGETHER WITH CANACCORD GENUITY, THE "JOINT BOOKRUNNERS" AND EACH A "JOINT BOOKRUNNER") WHO ARE (A) PERSONS IN MEMBER STATES OF THE EUROPEAN ECONOMIC AREA WHO ARE "QUALIFIED INVESTORS", AS DEFINED IN ARTICLE 2.1(E) OF DIRECTIVE 2003/71/EC AS AMENDED (THE "PROSPECTIVE DIRECTIVE"), (B) IF IN THE UNITED KINGDOM, PERSONS WHO (I) HAVE PROFESSIONAL EXPERIENCE IN MATTERS RELATING TO INVESTMENTS WHO FALL WITHIN THE DEFINITION OF "INVESTMENT PROFESSIONALS" IN ARTICLE 19(5) OF THE FINANCIAL SERVICES AND MARKETS ACT 2000 (FINANCIAL PROMOTION) ORDER 2005 AS AMENDED (THE "FPO") OR FALL WITHIN THE DEFINITION OF "HIGH NET WORTH COMPANIES, UNINCORPORATED ASSOCIATIONS ETC" IN ARTICLE 49(2)(A) TO (D) OF THE FPO AND (II) ARE "QUALIFIED INVESTORS" AS DEFINED IN SECTION 86 OF THE FINANCIAL SERVICES AND MARKETS ACT 2000 ("FSMA") OR (C) OTHERWISE PERSONS TO WHOM IT MAY OTHERWISE LAWFULLY BE COMMUNICATED (ALL SUCH PERSONS TOGETHER BEING REFERRED TO AS "RELEVANT PERSONS"). THIS ANNOUNCEMENT AND THE TERMS AND CONDITIONS SET OUT HEREIN MUST NOT BE ACTED ON OR RELIED ON BY PERSONS WHO ARE NOT RELEVANT PERSONS. DISTRIBUTION OF THIS ANNOUNCEMENT IN CERTAIN JURISDICTIONS MAY BE RESTRICTED OR PROHIBITED BY LAW. PERSONS DISTRIBUTING THIS ANNOUNCEMENT MUST SATISFY THEMSELVES THAT IT IS LAWFUL TO DO SO.

This announcement does not constitute or form part of any offer to sell, or any solicitation of an offer to buy, securities in the United States. The Placing Shares have not been and will not be registered under the Securities Act or under the securities laws of any state or other jurisdiction of the United States and may not be offered, sold, resold or delivered, directly or indirectly, in or into the United States absent registration except pursuant to an exemption from or in a transaction not subject to the registration requirements of the Securities Act. No public offering of the Placing Shares is being made in the United States. The Placing Shares are being offered and sold outside the United States in offshore transactions, as defined in, and in compliance with, Regulation S under the Securities Act. Persons receiving this announcement (including custodians, nominees and trustees) must not forward, distribute, mail or otherwise transmit it in or into the United States or use the United States mails, directly or indirectly, in connection with the Placing.

This announcement does not constitute an offer to sell or issue or a solicitation of an offer to buy or subscribe for Placing Shares in any jurisdiction including, without limitation, the Restricted Jurisdictions or any other jurisdiction in which such offer or solicitation is or may be unlawful. This announcement and the information contained in it is not for publication or distribution, directly or indirectly, to persons in a Restricted Jurisdiction unless permitted pursuant to an exemption under the relevant local law or regulation in any such jurisdiction.

No action has been taken by the Company, Canaccord Genuity or Shore Capital or any of their respective directors, officers, partners, agents, employees or affiliates that would permit an offer of the Placing Shares or possession or distribution of this announcement or any other publicity material relating to such Placing Shares in any jurisdiction where action for that purpose is required. Persons receiving this announcement are required to inform themselves about and to observe any such restrictions.

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

Any indication in this announcement of the price at which the Ordinary Shares have been bought or sold in the past cannot be relied upon as a guide to future performance. Persons needing advice should consult an independent financial adviser. No statement in this announcement is intended to be a profit forecast and no statement in this announcement should be interpreted to mean that earnings per share of the Company for the current or future financial years would necessarily match or exceed the historical published earnings per share of the Company.

Canaccord Genuity, which is authorised and regulated in the United Kingdom by the FCA, is acting for the Company and for no one else in connection with the Placing and will not be responsible to anyone other than the Company for providing the protections afforded to clients of Canaccord Genuity or for affording advice in relation to the Placing, or any other matters referred to herein.

Shore Capital, which is authorised and regulated in the United Kingdom by the FCA, is acting for the Company and for no one else in connection with the Placing and will not be responsible to anyone other than the Company for providing the protections afforded to clients of Shore Capital or for affording advice in relation to the Placing, or any other matters referred to herein.

By participating in the Placing, each person who is invited to and who chooses to participate in the Placing (a "Placee") by making or accepting an oral offer to subscribe for Placing Shares is deemed to have read and understood this announcement in its entirety (including this Appendix) and to be providing the representations, warranties, undertakings, agreements and acknowledgements contained in this Appendix.

EACH PLACEE SHOULD CONSULT WITH ITS OWN ADVISERS AS TO LEGAL, REGULATORY, TAX, BUSINESS AND RELATED ASPECTS OF A PURCHASE OF PLACING SHARES.

Details of the Placing Agreement and the Placing Shares

The Company has today entered into a placing agreement (the "Placing Agreement") with the Joint Bookrunners. Pursuant to the Placing Agreement, the Joint Bookrunners have, subject to the terms set out in such agreement, agreed to use reasonable endeavours, as agents of the Company, to procure Placees for the Placing Shares (the "Placing").

The Placing Shares will, when issued be subject to the articles of association of the Company, be credited as fully paid and will rank pari passu in all respects with each other and with the existing ordinary shares in the capital of the Company ("Ordinary Shares"), including the right to receive all dividends and other distributions declared, made or paid in respect of the Ordinary Shares after the date of issue of the Placing Shares.

The Placing Shares will be issued free of any encumbrance, lien or other security interest.

Application for Admission

Application will be made to the LSE for admission to trading of the Placing Shares on AIM. Admission is expected to become effective on or around 23 August 2016 (or such later date as the Joint Bookrunners may agree with the Company) and dealings in the Placing Shares and settlement will occur on the same day.

Principal terms of the Placing

1. The Joint Bookrunners are acting as agents of the Company in connection with the Placing on the terms and subject to the conditions of the Placing Agreement.

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

3. The price per Placing Share (the "Placing Price") is a fixed price of 225 pence and is payable to the relevant Joint Bookrunner (as agent for the Company) by all Placees.

4. Each Placee's allocation will be determined by the Joint Bookrunners in their discretion following consultation with the Company and will be confirmed orally by either Canaccord Genuity or Shore Capital and each Placee's allocation and commitment will be evidenced by a contract note issued to such Placee by the relevant Joint Bookrunner. The terms of this Appendix will be deemed incorporated in that contract note as soon as possible thereafter.

5. Canaccord Genuity or Shore Capital's oral confirmation of an allocation will give rise to an irrevocable, legally binding commitment by that person (who at that point becomes a Placee), in favour of such Joint Bookrunner and the Company, under which it agrees to acquire the number of Placing Shares allocated to it on the terms and subject to the conditions set out in this Appendix and in accordance with the Company's articles of association. Except with the relevant Joint Bookrunner's consent, such commitment will not be capable of variation or revocation at the time at which it is submitted.

6. Each Placee's allocation and commitment to subscribe for Placing Shares 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 the relevant Joint Bookrunner's consent will not be capable of variation or revocation after the time at which it is submitted.

7. Each Placee will have an immediate, separate, irrevocable and binding obligation, owed to Canaccord Genuity or Shore Capital (as applicable), as agent for the Company, to pay to it (or as it may direct) in cleared funds an amount equal to the product of the Placing Price and the number of Placing Shares such Placee has agreed to acquire and the Company has agreed to allot and issue to that Placee.

8. 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.

9. Irrespective of the time at which a Placee's allocation(s) pursuant to the Placing is/are 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".

10. All obligations under the 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 "Termination of the Placing".

11. By participating in the Placing, each Placee will agree 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.

12. Whilst the Acquisitions and the Placing are each conditional upon, amongst other things, the passing of the Resolutions at the General Meeting, the Acquisitions are also conditional on a number of other matters and are, therefore, expected to complete after Admission. As such, the Placing is not conditional upon completion of the Acquisitions and there is, therefore, a possibility that the Placing Shares might be issued but that none (or not all) of the Acquisitions will complete.

13. To the fullest extent permissible by law, neither: (a) the Joint Bookrunners, (b) any of their affiliates, agents, directors, officers, consultants or employees nor (c) to the extent not contained within (a) or (b), any person connected with the Joint Bookrunners as defined in FSMA ((b) and (c) being together "Affiliates" and individually an "Affiliate" of the Joint Bookrunners) shall have any liability (including to the extent permissible by law, any fiduciary duties) to Placees or to any other person whether acting on behalf of a Placee or otherwise. In particular, neither Joint Bookrunner nor any of their affiliates shall have any liability (including, to the extent permissible by law, any fiduciary duties) in respect of each Joint Bookrunner's conduct of the Placing or of such alternative method of effecting the Placing as the Joint Bookrunners and the Company may agree.

Conditions of the Placing

The Placing is conditional upon the Placing Agreement becoming unconditional and not having been terminated in accordance with its terms.

The obligations of each of the Joint Bookrunners under the Placing Agreement are conditional, inter alia, on:

1. the warranties on the part of the Company contained in the Placing Agreement being true and accurate in all material respects and not misleading in any material respect on and as of the date of the Placing Agreement and on Admission, as though they had been given and made on such date by reference to the facts and circumstances then subsisting;

2. none of the Acquisition Agreements having been terminated and the Company's obligations under such Acquisition Agreements being in full force and effect;

3. the performance by the Company of its obligations under the Placing Agreement to the extent that they fall to be performed prior to Admission;

4. in the opinion of each of the Joint Bookrunners, acting in good faith, there shall have been no material adverse change since the date of the Placing Agreement (whether or not foreseeable at the date of the Placing Agreement) before Admission;

5. the passing of the Resolutions at the General Meeting, without any amendment not approved by the Joint Bookrunners (acting jointly);

6. the Company delivering, by no later than 5.00 p.m. on the dealing day immediately prior to the expected date of admission (but dated the day of Admission), to the Joint Bookrunners a certificate confirming, inter alia, that none of the warranties given by the Company in the Placing Agreement was untrue, inaccurate or misleading when made or would cease to be true and accurate or would become misleading were it to be repeated by reference to the facts and circumstances subsisting on the date of the certificate;

7. the obligations of the Joint Bookrunners not having been terminated pursuant to the Placing Agreement and the Placing Agreement otherwise becoming unconditional; and

8. Admission occurring not later than 8.00 a.m. on or around 31 August 2016 or such later time as the Joint Bookrunners (acting jointly) may agree in writing with the Company (but in any event not later than 8.00 a.m. on 7 September 2016).

If (a) any of the conditions are not fulfilled (or to the extent permitted under the Placing Agreement, waived by the Joint Bookrunners) by the relevant time or date specified in the Placing Agreement, or (b) the Placing Agreement is terminated in the circumstances specified below, the Placing will lapse and each Placee's rights and obligations hereunder shall cease and determine at such time and no claim may be made by a Placee in respect thereof. Neither of the Joint Bookrunners, the Company, nor any of their respective Affiliates 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 in the Placing Agreement or in respect of the Placing generally.

The Joint Bookrunners may (acting jointly) waive 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 for the above condition relating to Admission. Any such extension or waiver will not affect Placees' commitments as set out in this announcement.

By participating in the Placing, each Placee agrees that its rights and obligations hereunder terminate only in the circumstances described below under "Right to terminate under the Placing Agreement", and will not be capable of rescission or termination by the Placee.

Right to terminate under the Placing Agreement

The Joint Bookrunners may, at any time before Admission, terminate its obligations under the Placing Agreement by jointly giving notice to the Company if, inter alia:

1. it comes to the knowledge of either Joint Bookrunner that any of the warranties was untrue, inaccurate or misleading, in each case, in any material respect when made on the date of the Placing Agreement and/or that any of the warranties would be untrue, inaccurate or misleading, in each case, in any material respect if it were to be repeated immediately prior to Admission;

2. it comes to the notice of either Joint Bookrunner that any statement contained in this announcement, or certain of the other documents delivered in relation to the Placing, is or has become untrue, incorrect or misleading in any material respect;

3. the Company is in material breach of its obligations under the Placing Agreement;

4. any government regulation or other occurrence of any nature whatsoever which, in the opinion of the Joint Bookrunners, acting in good faith, materially and adversely affects or will or is reasonably likely to materially and adversely affect the business of the Group taken as a whole

5. a suspension or material limitation in trading in securities generally on the London Stock Exchange's market for listed securities, a general moratorium on commercial banking activities in London or New York or a material disruption in commercial banking or securities settlement or clearance services in the United Kingdom or United States of America, an incident of terrorism or the outbreak or escalation of hostilities involving the UK, any other EU Member State or the USA or the declaration by the UK, any other EU Member State or the USA of a national emergency or war or the occurrence of any other calamity or crisis resulting in a change in financial, political, market or economic conditions or currency exchange rates in the UK or US which, in the opinion of the Joint Bookrunners, acting in good faith, makes it impractical or inadvisable to continue with the Placing in the terms or in the manner contemplated in the Placing Agreement; or

6. any material adverse change occurs and, in the opinion of the Joint Bookrunners, acting in good faith, the effect of such change is such that it would materially prejudice the success of the Placing or the distribution of Placing Shares or the application for Admission is refused by the London Stock Exchange.

By participating in the Placing, each Placee agrees with the Joint Bookrunners that the exercise by the Joint Bookrunners of any right of termination or other discretion under the Placing Agreement shall be within the absolute discretion of the Joint Bookrunners and that neither of the Joint Bookrunners need make any reference to the Placees in this regard and that, to the fullest extent permitted by law, neither of the Joint Bookrunners shall have any liability whatsoever to the Placees in connection with any such exercise.

No Prospectus

No offering document or prospectus has been or will be prepared in relation to the Placing and no such prospectus is required to be published and Placees' commitments will be made solely on the basis of the information contained in this announcement and any information previously published by or on behalf of the Company by notification to a Regulatory Information Service. 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 to the Joint Bookrunners and the Company that it has neither received nor relied on any information, representation, warranty or statement made by or on behalf of the Joint Bookrunners (other than the amount of the relevant Placing participation in the oral confirmation given to Placees and the trade confirmation referred to below), any of their respective Affiliates, any persons acting on its behalf or the Company and neither of the Joint Bookrunners nor any of their respective Affiliates, any persons acting on their behalf, nor the Company will be liable for the decision of any Placee to participate in the Placing based on any other information, representation, warranty or statement which the Placee may have obtained or received (regardless of whether or not such information, representation, warranty or statement was given or made by or on behalf of any such persons).

By participating in the Placing, each Placee acknowledges to and agrees with the Joint Bookrunners for themselves and as agent for the Company that, except in relation to the information contained in this announcement, it has relied on its own investigation of the business, financial or other position of the Company in deciding to participate in the Placing. Nothing in this paragraph shall exclude the liability of any person for fraudulent misrepresentation.

Registration and settlement

Settlement of transactions in the Placing Shares (ISIN: JE00BWT5X884) following Admission will take place within the CREST system, subject to certain exceptions. The Joint Bookrunners reserve the right to require settlement for and delivery of the Placing Shares to Placees by such other means that they deem necessary, 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 the Placee's jurisdiction.

Each Placee allocated Placing Shares in the Placing will be sent a trade confirmation stating the number of Placing Shares allocated to it, the Placing Price, the aggregate amount owed by such Placee to the relevant Joint Bookrunner and settlement instructions.

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 the base rate of Barclays Bank Plc.

Each Placee is deemed to agree that if it does not comply with these obligations: (i) the Company may release itself (if it decides in its absolute discretion to do so) and will be released from all obligations it may have to issue any such Placing Shares to such Placee or at its direction which are then 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 fullest extent permitted under its articles of association or otherwise by law and to the extent that such Placee then has any interest in or rights in respect of any such Placing Shares; (iii) the Company or the Joint Bookrunners may sell (and each of them is irrevocably authorised by such Placee to do so) all or any of such Placing Shares on such Placee's behalf and then retain from the proceeds, for the account and benefit of the Company or, where applicable, the Joint Bookrunners (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 (together with any interest or penalties) arising on the sale of such Placing Shares on such Placee's behalf, 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) such Placee shall remain liable to the Company and to the Joint Bookrunners (as applicable) for the full amount of any losses and of any costs which it may suffer or incur as a result of it (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.

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

Insofar as Placing Shares are registered in the Placee's name or that of its nominee or in the name of any person for whom the Placee is contracting as agent or that of a nominee for such person, such Placing Shares will, subject as provided below, be so registered free from any liability to stamp duty or stamp duty reserve tax. If there are any circumstances in which any other stamp duty or stamp duty reserve tax is payable in respect of the issue of the Placing Shares, neither the Joint Bookrunners nor the Company shall be responsible for the payment thereof. Placees will not be entitled to receive any fee or commission in connection with the Placing.

Representations and Warranties

By participating in the Placing, each Placee (and any person acting on such Placee's behalf):

1. represents and warrants that it has read and understood this announcement in its entirety (including this Appendix) and acknowledges that its participation in the Placing will be governed by the terms of this announcement (including this Appendix);

2. acknowledges that no prospectus or offering document has been or will be prepared in connection with the Placing and it has not received and will not receive a prospectus or other offering document in connection with the Placing or the Placing Shares;

3. agrees to indemnify on an after-tax basis and hold harmless each of the Company, the Joint Bookrunners, their respective Affiliates and any person acting on their behalf 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 announcement and further agrees that the provisions of this announcement shall survive after completion of the Placing;

4. acknowledges that the Placing Shares will be 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, 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 the Company's admission document (collectively, the "Exchange Information"), and that it is able to obtain or access such information without undue difficulty and has read and understood the Exchange Information;

5. acknowledges that neither of the Joint Bookrunners, nor any of their respective Affiliates nor any person acting on their behalf has provided, and will not provide it with any material or information regarding the Placing Shares or the Company; nor has it requested either of the Joint Bookrunners, nor any of their respective Affiliates nor any person acting on their behalf to provide it with any such material or information;

6. acknowledges that the content of this announcement is exclusively the responsibility of the Company and that neither of the Joint Bookrunners, nor any of their respective Affiliates nor any person acting on their behalf will be responsible for or shall have any liability for any information, representation or statement relating to the Company contained in this announcement or any information previously published by or on behalf of the Company and neither of the Joint Bookrunners, nor any of their respective Affiliates nor any person acting on their behalf will 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 to subscribe for 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 relied on its own investigation with respect to the Placing Shares and the Company in connection with its decision to subscribe for the Placing Shares and acknowledges that it is not relying on any investigation that either of the Joint Bookrunners, any of their respective Affiliates or any person acting on their behalf may have conducted with respect to the Placing Shares or the Company and none of such persons has made any representations to it, express or implied, with respect thereto;

7. acknowledges that it 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 is able to bear, the economic risk of, and is able to sustain, a complete loss in connection with the Placing. It has had sufficient time to consider and conduct its own investigation with respect to the offer and subscription for the Placing Shares, including the tax, legal and other economic considerations and has relied upon its own examination and due diligence of the Company and its affiliates taken as a whole, and the terms of the Placing, including the merits and risks involved;

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

9. acknowledges that it has not relied on any information relating to the Company contained in any research reports prepared by either of the Joint Bookrunners, their respective Affiliates or any person acting on their or any of their respective Affiliates' behalf and understands that (i) neither of the Joint Bookrunners, nor any of their respective Affiliates nor any person acting on their behalf has or shall have any liability for public information or any representation; (ii) neither of the Joint Bookrunners, nor any of their respective Affiliates, nor any person acting on their behalf has or shall have any liability for any additional information that has otherwise been made available to such Placee, whether at the date of publication, the date of this announcement or otherwise; and that (iii) neither of the Joint Bookrunners, nor any of their respective Affiliates, nor any person acting on their behalf makes any representation or warranty, express or implied, as to the truth, accuracy or completeness of such information, whether at the date of publication, the date of this announcement or otherwise;

10. represents and warrants that (i) it is entitled to acquire the Placing Shares under the laws and regulations of all relevant jurisdictions which apply to it; (ii) it has fully observed such laws and regulations and obtained all such governmental and other guarantees and other consents and authorities which may be required thereunder and complied with all necessary formalities; (iii) it has all necessary capacity to commit to participation in the Placing and to perform its obligations in relation thereto and will honour such obligations; (iv) it has paid any issue, transfer or other taxes due in connection with its participation in any territory; and (v) it has not taken any action which will or may result in the Company, either of the Joint Bookrunners, any of their respective Affiliates or any person acting on their behalf being in breach of the legal and/or regulatory requirements of any territory in connection with the Placing;

11. represents and warrants that it understands that the Placing Shares have not been and will not be registered under the Securities Act or under the securities laws of any state or other jurisdiction of the United States and may only be acquired in "offshore transactions" as defined in and pursuant to Regulation S under the Securities Act or in transactions exempt from or not subject to the registration requirements of the Securities Act;

12. represents and warrants that its acquisition of the Placing Shares has been or will be made in an "offshore transaction" as defined in and pursuant to Regulation S under the Securities Act;

13. represents and warrants that it will not offer or sell, directly or indirectly, any of the Placing Shares in the United States except in accordance with Regulation S or pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act;

14. understands that upon the initial issuance of, and until such time as the same is no longer required under the Securities Act or applicable securities laws of any state or other jurisdiction of the United States, any certificates representing the Placing Shares (to the extent such Placing Shares are in certificated form), and all certificates issued in exchange therefore or in substitution thereof, shall bear a legend setting out the restrictions relating to the transfer of the certificated security including with respect to restrictions relating to the United States federal securities laws;

15. represents and warrants that, if it is a financial intermediary, as that term is used in Article 3(2) of the EU Prospectus Directive, 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 EU Prospectus Directive other than "qualified investors" as defined in Article 2.1(e) of the EU Prospectus Directive, or in circumstances in which the prior consent of the Joint Bookrunners has been given to the offer or resale;

16. represents and warrants that it has not offered or sold and will not offer or sell any Placing Shares to the public in any member state of the European Economic Area except in circumstances falling within Article 3(2) of the EU Prospectus Directive which do not result in any requirement for the publication of a prospectus pursuant to Article 3 of the EU Prospectus Directive;

17. 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 FSMA) relating to the Placing Shares in circumstances in which it is permitted to do so pursuant to section 21 of FSMA;

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

19. represents and warrants that it has complied with its obligations in connection with money laundering and terrorist financing under the Criminal Justice Act 1993, the EU Market Abuse Regulation (2014/596/EU), the Proceeds of Crime Act 2002 (as amended), the Terrorism Act 2000, the Terrorism Act 2006, the Anti-terrorism Crime and Security Act 2001, the Money Laundering Regulations (2007) (the "Regulations") and the Money Laundering Sourcebook of the FCA and, if it is 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;

20. if in the United Kingdom, represents and warrants that it is a person falling within (a) Article 19(5) of the FPO or (b) a person falling within Article 49(2)(a) to (d) of the FPO 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;

21. if in the United Kingdom, represents and warrants that it is a qualified investor as defined in section 86(7) of FSMA, being a person falling within Article 2.1(e)(i), (ii) or (iii) of the EU Prospectus Directive;

22. represents and warrants that its participation in the Placing would not give rise to an offer being required to be made by it or any person with whom it is acting in concert pursuant to Rule 9 of the City Code on Takeovers and Mergers; undertakes that it (and any person acting on its behalf) will pay for the Placing Shares acquired by it in accordance with this announcement on the due time and date set out in this announcement or any trade confirmation issued pursuant to this announcement against delivery of such Placing Shares to it, failing which the relevant Placing Shares may be placed with other Placees or sold as either the Joint Bookrunners or the Company may, in their absolute discretion, determine 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 any costs, commissions, stamp duty or stamp duty reserve tax (together with any interest or penalties due pursuant to the terms set out or referred to in this announcement) which may arise upon the sale of such Placee's Placing Shares on its behalf;

23. if it has received any confidential price sensitive information about the Company in advance of the Placing, it warrants that it has received such information within the marketing soundings regime provided for in article 11 of Regulation (EU) No. 596/2014 on market abuse (as amended) and associated delegated regulations and has not: (a) dealt in the securities of the Company; (b) encouraged or required another person to deal in the securities of the Company; or (c) disclosed such information to any person, prior to the information being made publicly available;

24. acknowledges that neither of the Joint Bookrunners, nor any of their Affiliates nor any person acting on their behalf is making any recommendations to it or advising it regarding the suitability or merits of any transaction it may enter into in connection with the Placing, and acknowledges that neither of the Joint Bookrunners, nor any of their Affiliates nor any person acting on their behalf has any duties or responsibilities to it 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 the Joint Bookrunners' rights and obligations thereunder, including any right to waive or vary any condition or exercise any termination right contained therein;

25. undertakes that (i) the person whom it specifies for registration as holder of the Placing Shares will be (a) the Placee or (b) the Placee's nominee, as the case may be, (ii) neither of 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 and (iii) the Placee and any person acting on its behalf agrees to acquire the Placing Shares on the basis that the Placing Shares will be issued to the CREST stock account of the relevant Joint Bookrunner which will hold them as settlement agent as nominee for the Placee until settlement in accordance with its standing settlement instructions with payment for the Placing Shares being made simultaneously upon receipt of the Placing Shares in the Placee's stock account on a delivery versus payment basis;

26. acknowledges that any agreements entered into by it pursuant to these terms and conditions, and any non-contractual obligations arising out of or in connection with such agreements, 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 courts of England and Wales as regards any claim, dispute or matter arising out of any such contract;

27. acknowledges that it irrevocably appoints any director of the relevant Joint Bookrunner as its agent for the purposes of executing and delivering to the Company and/or its registrars any documents on its behalf necessary to enable it to be registered as the holder of any of the Placing Shares agreed to be taken up by it under the Placing;

28. represents and warrants that it is not a resident of any Restricted Jurisdiction and acknowledges that the Placing Shares have not been and will not be registered nor will a prospectus be cleared in respect of the Placing Shares under the securities legislation of any Restricted Jurisdiction and, subject to certain exceptions, may not be offered, sold, taken up, renounced, delivered or transferred, directly or indirectly, within any Restricted Jurisdiction;

29. represents and warrants that any person who confirms to either Joint Bookrunner on behalf of a Placee an agreement to subscribe for Placing Shares and/or who authorises either Joint Bookrunner to notify the Placee's name to the Company's registrar, has authority to do so on behalf of the Placee;

30. acknowledges that the agreement to settle each Placee's acquisition of Placing Shares (and/or the acquisition of a person for whom it is contracting as agent) free of stamp duty and stamp duty reserve tax depends on the settlement relating only to an acquisition by it and/or such person direct from the Company of the Placing Shares in question. Such agreement assumes that the Placing Shares are not being acquired in connection with arrangements to issue depositary receipts or to issue or transfer the Placing Shares into a clearance service. If there were any such arrangements, or the settlement related to other dealing in the Placing Shares, stamp duty or stamp duty reserve tax may be payable, for which neither the Company nor either of the Joint Bookrunners will be responsible. If this is the case, the Placee should take its own advice and notify the Joint Bookrunners accordingly;

31. acknowledges that the Placing Shares will be issued and/or transferred subject to the terms and conditions set out in this announcement (including this Appendix);

32. acknowledges that when a Placee or any person acting on behalf of the Placee is dealing with the relevant Joint Bookrunner, any money held in an account with the relevant 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 relevant rules and regulations of the FCA. 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 relevant Joint Bookrunner money in accordance with the client money rules and will be used by the relevant Joint Bookrunner in the course of its business; and the Placee will rank only as a general creditor of the relevant Joint Bookrunner (as the case may be);

33. acknowledges and understands that the Company, the Joint Bookrunners, and others will rely upon the truth and accuracy of the foregoing representations, warranties, agreements, undertakings and acknowledgements;

34. acknowledges and understands that whilst the Acquisitions and the Placing are each conditional upon, amongst other things, the passing of the Resolutions at the General Meeting, the Acquisitions are also conditional on a number of other matters and are, therefore, expected to complete after Admission. As such, the Placee acknowledges and understands that the Placing is not conditional upon completion of the Acquisitions and there is, therefore, a possibility that the Placing Shares might be issued but that none (or not all) of the Acquisitions will complete;

35. acknowledges that the basis of allocation will be determined by the Joint Bookrunners at their absolute discretion in consultation with the Company. The right is reserved to reject in whole or in part and/or scale back any participation in the Placing;

36. irrevocably authorises the Company and the Joint Bookrunners to produce this announcement pursuant to, in connection with, or as maybe required by any applicable law or regulation, administrative or legal proceeding or official inquiry with respect to the matters set forth in this announcement; and

37. that its commitment to subscribe for 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 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 acknowledgements, agreements, undertakings, representations and warranties referred to above are given to each of the Company and the Joint Bookrunners (for their own benefit and, where relevant, the benefit of their respective Affiliates and any person acting on their behalf) and are irrevocable.

No claim shall be made against the Company, the Joint Bookrunners, their respective Affiliates or any other person acting on behalf of any of such persons by a Placee to recover any damage, cost, charge or expense which it may suffer or incur by reason of or arising from the carrying out by it of the work to be done by it pursuant to this announcement or the performance of its obligations pursuant to this announcement or otherwise in connection with the Placing.

No UK stamp duty or stamp duty reserve tax should be payable to the extent that the Placing Shares are issued or transferred (as the case may be) into CREST to, or to the nominee of, a Placee who holds those shares beneficially (and not as agent or nominee for any other person) within the CREST system and registered in the name of such Placee or such Placee's nominee.

Any arrangements to issue or transfer the Placing Shares into a depositary receipts system or a clearance service or to hold the Placing Shares as agent or nominee of a person to whom a depositary receipt may be issued or who will hold the Placing Shares in a clearance service, or any arrangements subsequently to transfer the Placing Shares, may give rise to stamp duty and/or stamp duty reserve tax, 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 stamp duty or stamp duty reserve tax undertakes to pay such 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 either of the Joint Bookrunners has incurred any such liability to stamp duty or stamp duty reserve tax.

In addition, Placees should note that they will be liable for any capital duty, 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 acquisition by them of any Placing Shares or the agreement by them to acquire any Placing Shares.

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 such changes.

This announcement has been issued by the Company and is the sole responsibility of the Company.

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 Affiliates may, at their absolute discretion, agree to become a Placee in respect of some or all of the Placing Shares.

The rights and remedies of the Joint Bookrunners and the Company under these terms and conditions are in addition to any rights and remedies which would otherwise be available to each of them and the exercise or partial exercise or partial exercise of one will not prevent the exercise of others.

Each Placee may be asked to disclose in writing or orally to either of the Joint Bookrunners:

(a) if he is an individual, his nationality; or

(b) if he is a discretionary fund manager, the jurisdiction in which the funds are managed or owned.