Westminster Group Regulatory News (WSG)

THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION FOR THE PURPOSES OF ARTICLE 7 OF EU REGULATION 596/2014

Westminster Group Plc

('Westminster', the 'Group' or the 'Company')

£3.0 million Financing Facility,

£1.75 million Equity Placing and Sharing Agreement and

Commencement of repayment of outstanding Convertible Loan Notes

Westminster Group Plc (AIM: WSG), the AIM listed supplier of managed security services and technology-based security solutions to governments and government agencies, non-governmental organisations (NGO's) and blue-chip commercial organisations worldwide, is pleased to announce it has entered into a £3.0m Mezzanine Loan Facility and a £1.75m Equity Placing and Sharing Agreement (together the "Financing Facility") with RiverFort Global Opportunities PCC and YA II PN Ltd. (together the "Investor") which is being used to repay its existing £2.245m Convertible Secured Loan Notes and to provide additional financing if required.

Commencement of repayment of outstanding Convertible Loan Notes

We are pleased to announce that we have now commenced a staged redemption programme of the Company's existing £2.245m Convertible Secured Loan Notes ("CSLNs") which is planned to be completed well before the CSLNs maturity date of 30 June 2020. The CLSNs, initially issued on 19 June 2013, were amended as outlined in our announcement on 22 May 2019 and carry a 15% coupon and from 31 December 2019 holders may elect to convert their CSLNs at 10p per share in place of cash redemption. The May 2019 amendments also allow the Company to redeem the CSLNs in whole or in part at any time before the maturity date without restriction or penalty.

Overview of Financing Facility

The Financing Facility will provide the Company with a £3million Mezzanine Loan Facility which may be drawn down in tranches, each repayable over 18 months, together with monthly cash inflows under the Equity Placing and Sharing Agreement, based on the Company's share price performance, which will go towards the monthly repayment costs of the loan.

The Financing Facility has therefore enabled the Company to prudently commence the CSLNs redemption programme, well ahead of the maturity date, saving on both interest and management fees as well as providing additional funds if required. The Financing Facility therefore provides the Company with the required financial resources and flexibility to maintain its growth and deliver on its project opportunities and allows the Company to benefit from future growth in the Westminster share price.

Details of the Financing Facility

The Company has entered into a £3.0m Mezzanine Loan Facility with the Investor and has elected to drawdown an initial £1.5m to fund the commencement of the staged CSLNs redemption programme and provide additional working capital. The Company has the right, at its sole discretion, to draw down up to a further £1.5m at any time in the following 24 months, subject to certain conditions.

The Mezzanine Loan Facility is subject to a 0.75% Commitment Fee and each drawdown will have a term of 18 months at a 6.5% rate of interest and a 5% drawdown fee. Repayments will commence 3 months after drawdown and be followed by 15 equal monthly payments. The Company can if it wishes, elect to convert any of its monthly payments or amounts due by issuing the Investor with a convertible note giving conversion rights equal to the amount concerned, in which case the Investor will have 12 months to convert the note into ordinary shares of the Company at the lower of 14.54p or the 90% 5 day volume weighted average price immediately preceding the date of such notice. The Company may also elect to make early repayment of any outstanding amount subject to a 5% early redemption premium.

Separately under the Equity Placing and Sharing Agreement ("EPSA") the Investor will subscribe £1.75m ("Subscription Amount") for ordinary shares in the Company at a price of 12.5p per ordinary share ("Subscription Shares") on deferred payment terms subject to a 3% placing commission. The Investor will have the right to sell the Subscription Shares, subject to certain volume restrictions, over a 12-month period, extendable to 24 months at the Investor's discretion. Under the EPSA the Investor and its affiliates are prohibited from holding any short position in or to forward or short sell Westminster shares. The Investor may elect to convert the balance, if any, of the remaining Mezzanine Loan into ordinary shares of 14.54p once all the Subscription Shares have been sold. The Investor has also agreed that Subscription Shares may be sold to any third party introduced by Westminster, individually or as part of a future fundraising.

Under the EPSA, in each calendar month, the Investor will make a payment to the Company calculated as 1/12 of the Subscription Amount adjusted by the proportionate difference between the Market Price (being the volume weighted average price of the lowest 10 days in the month of settlement) and the benchmark price of 13.625p ("Benchmark Price"). Where the Market Price is greater than the Benchmark Price both the Company and Investor will receive 50% of the excess so that the Company and the Investor will share the benefit of growth in the Company's share performance over a 12-month period.

The Company has agreed to issue to the Investor 3,499,222 warrants at 14.54p, being a premium of 34% to the closing price of 10.85p on 21 January 2020, that can be exercised between 6 and 48 months from issue.

The 14,000,000 Subscription Shares will be issued on 23 January 2020 and are expected to be admitted to AIM on 28 January 2020.

Total Voting Rights

The Company's total issued share capital, following the issue of the Subscription Shares, will be 159,402,511 ordinary shares. As the Company does not hold any shares in Treasury, this figure may be used by shareholders in the Company as the denominator for the calculations by which they will determine if they are required to notify their interest in, or a change to their interest in, the share capital of the Company following Admission.

Commenting on the Financing Facility, Westminster's CEO, Peter Fowler, said:

"The financing facility from RiverFort provides the Group with a flexible financing option that not only enables us to commence redemption of the existing Convertible Secured Loan Notes well before the maturity date, saving on both interest and management fees, but also provides us with the option of a flexible facility for project financing, if required.

"With the option to draw down further funds at our discretion, the option to elect to pay any monthly payments as convertible notes and the option to make early repayment, should we so wish, makes this a very flexible financing facility for our current needs.

"Given the Group's growth prospects we believe this structure and facility provides us with the necessary flexibility needed to support the continued growth of the business with the added benefit of the upside potential from future share price growth."

For further information please contact:

Notes:

Westminster Group plc is a specialist security and services group operating worldwide via an extensive international network of agents and offices in over 50 countries.

Westminster's principal activity is the design, supply and ongoing support of advanced technology security solutions, encompassing a wide range of surveillance, detection, tracking and interception technologies and the provision of long-term managed services contracts such as the management and running of complete security services and solutions in airports, ports and other such facilities together with the provision of manpower, consultancy and training services. The majority of its customer base, by value, comprises governments and government agencies, non-governmental organisations (NGO's) and blue-chip commercial organisations.