The Mission Group Regulatory News (TMG)

The Mission Marketing Group plc ("themission®", or "the Company")

Proposed Settlement of Acquisition Liabilities and Issue of Equity, Restructuring of Bank Debt, Board Changes and LTIP Scheme

Further to themission®'s announcement of its preliminary results today, the Company is pleased to announce details of a number of initiatives to restructure the Company's balance sheet and a number of changes to its Board.

Settlement of acquisition liabilities

At 31 December 2009, themission® or its group companies had acquisition liability commitments to vendors of Big Communications, Fuse Digital, Bray Leino, PCM and TDi totalling £3.9m, of which £2.9m fell due for settlement during 2010 and £1.0m fell due in 2011 (in each case together with accrued interest as appropriate). themission® is pleased to announce that it has reached agreement in principle with holders of initial consideration and additional consideration loan notes that approximately £3m of these loan notes will, subject to shareholder and any necessary regulatory approval, be settled through the issue of new ordinary shares in the Company, with the balance expected to be repaid in cash raised from a placing of new ordinary shares. In addition, the Company has agreed that certain deferred consideration falling due in 2010 will, subject to shareholder approval, be satisfied entirely by the issue of new ordinary shares in the Company rather than further loan notes.

These agreements remove very significant cash obligations and provide the Company with a strengthened balance sheet to pursue its priorities of driving organic growth through new business wins, improving operational efficiency and delivering for its customers, without having the significant distraction of cash-related concerns.

As a result of the above, it is expected approximately 22 million new ordinary shares will be issued to those vendors at 13p per ordinary share ("Vendor Shares"). Based on expressions of interest received by the Company so far, a total of approximately 8 million new ordinary shares ("Placing Shares") will be issued at 13p per ordinary share in a placing to satisfy the cash payment for the balance of the loan notes outstanding and provide working capital. The Placing shares will be subscribed for by a number of the vendors involved, as well as other shareholder employees of the Group and other investors.

The expected issue of the Vendor Shares and the Placing Shares is subject to the Company obtaining shareholder approval in accordance with the Companies Act 2006 and any other regulatory approvals. Resolutions will be put to shareholders in this regard at a General Meeting of the Company, notice of which will be sent to shareholders in due course.

Restructuring of Bank Debt

In addition to the agreements reached with vendors referred to above, the Company is also pleased to announce that it has agreed terms with its lenders for the alteration of its loan facilities. The £20.3 million lending facility will be split into a £17.3 million term loan and a £3 million mezzanine loan, with no capital repayment on the former until June 2011 and no capital or interest margin on the mezzanine loan until the end of 2013. As part of the alterations, the banks have been issued with warrants to subscribe for ordinary shares equating to 3.156% of the fully diluted share capital of the Company at 10p per ordinary share, exercisable from 31 December 2012.

At the same time the banks have agreed to the settling of the vendor loan notes and deferred consideration as set out above.

The benefit to themission® of the agreements with its vendors and lenders is the elimination of its loan note liabilities and a significant relief of term loan repayment as the Group rebuilds its profitability as market conditions improve.

Board Changes

As set out in today's preliminary results announcement, with the focus now on organic growth, and having completed the initial buy-and-build phase to list the Company on the public market and establish the Group, Iain Ferguson earlier this year advised the Board of his intention, at the appropriate time, to step down as CEO to pursue other interests, both here and in the international arena. The Board has agreed that the need for central resources dedicated to further Group acquisitions is now reduced and have therefore made additional changes to the management team and Board, reflecting the Company's current focus on existing operations.

David Morgan is appointed as Executive Chairman, and Dylan Bogg, Robert Day, Bruce Hutton, Sue Mullen and Fiona Shepherd, each the CEO of Group agencies, also join the Board as Executive Directors. Additionally, on 16 December 2009 the Company announced the appointments of Stephen Boyd and Chris Morris as Non-Executive Directors, adding further financial expertise and industry representation to the Board.

Also as part of this re-focus, Tim Alderson has tendered his resignation as CFO and will be replaced on an interim basis by Peter Fitzwilliam, formerly deputy CFO at Photo-Me International Plc, who brings with him specific experience in cash management. Finally, having acted as Chairman during this transitional period, Brian Child will return to his previous role of Non-Executive Director.

The Board of the Company now comprises the following Executive Directors:

The following existing members of the Board will remain as non-executive Directors:

The Board is confident that these developments, effective as of today's date, will simplify the organisational structure, help improve cash optimisation and, as a result, accelerate debt reduction.

Long Term Incentive Plan ("LTIP")

As part of the increased focus on achieving profitable organic growth, and to align key management within the Group to increasing shareholder value, the LTIP scheme introduced last year to incentivise key managers will be extended to all agencies during 2010. In addition, the vesting conditions relating to all past and future awards will be simplified and solely dependent upon achieving profit targets over a three year period.

A further announcement regarding those matters to be disclosed pursuant to Schedule 2 paragraph (g) of the AIM Rules in respect of the new directors will be made in due course.

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