TSL.L Regulatory News (TSL)

3 February 2022

ThinkSmart Limited

 ("ThinkSmart" or the "Company" which together with its subsidiaries is the "Group")

Business Update

ThinkSmart Limited (AIM: TSL), a specialist digital payments platform business, wishes to provide an update on its operating business.

As set out in the 2021 AGM Chairman's statement on 10 November 2021, the Group's strategic focus is on delivering value to shareholders via its Clearpay asset, which has now been exchanged for 618,750 shares in Block, Inc (NYSE: SQ), together with the provision of the outsourced call centre customer support service for Clearpay and the managed wind-down of its legacy retail consumer and business finance offerings to deliver net positive cashflows. Shareholders will be aware that the Group ceased originating any new business volumes from February 2021.

As set out in note 23 to the ThinkSmart Annual Report for the year to 30 June 2021, under the terms of the Group's funding arrangement with Secure Trust Bank ("STB"), where STB is the lessor and ThinkSmart acted as STB's agent under an Operating Agreement, the Group had entered into a financial guarantee contract with STB in support of which the Group had deposited £2m with STB.

Under the terms of the Operating Agreement, the Group has now agreed with STB to terminate the Operating Agreement and to purchase the portfolio of leases, funded under the Operating Agreement, from STB for £1.2m. In return STB will refund the £2m deposit to ThinkSmart which will result in a net £0.8m increase in the Group's cash. It is expected that this transaction will complete this month.

The Group will continue to service the leases, ensuring the fair treatment of customers, during the orderly wind down and collect out of the portfolio of leases. The lease portfolio purchased has a minimum term gross receivable balance of £1.25m and an average term outstanding of 10 months. ThinkSmart will continue to be entitled to all rental income and revenue from sales of leased equipment following the end of the initial term of the leases, and is managing its cost base accordingly so that its operating business continues to deliver net positive cashflows.

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Notes to Editors

About ThinkSmart Limited

ThinkSmart's roots are as a specialist digital payments platform business. Following the sale of its remaining 10% shareholding in Clearpay in January 2022, the Group holds shares in NYSE listed Block, Inc (NYSE: SQ). The Group also provides an outsourced call centre customer service and support service to Clearpay and is managing the wind-down of its leasing business.