Financing Update

20 March 2013

Phorm Corporation Limited ("Phorm" or the "Company")

Financing Update

Phorm (AIM: PHRM), the internet personalization technology company, is pleased to announce that it has raised funds through a placing (the "Placing") of convertible secured loan notes (the "Loan Notes") with a new investor.

The key terms of the Loan Notes are:

·; Placing of £3,000,000 (before expenses) with £1,500,000 immediately available

·; Initial annualised coupon rate of 20%, payable upon redemption

·; Repayable 14 March, 2014

·; Converts into ordinary shares in Phorm at a price of 20p per share

·; Secured with a fixed and floating charge on the Company's assets

·; The Company may elect to repay the Loan Notes at any time after issue prior to the redemption date

·; The Loan Notes are intended as short term bridge finance to provide sufficient time for a larger funding round to be completed

The Loan Note is payable in two tranches, each of £1,500,000, with the first tranche payable immediately and having been received. The second tranche is payable once the Company's Turkish operations become profitable at the country level. The Loan Note matures one year from completion of the first tranche and carries an initial annual coupon of 20%. If the Loan Note remains unpaid or unconverted after this time the coupon falls to 10%. The Loan Note is convertible into ordinary shares of the Company at a price of 20p per ordinary share at any time and is secured by a fixed and floating charge against the assets of the Company. The Company may redeem the Loan Note at any point by serving one month's notice, with the investor being able to elect to take redemption in cash or ordinary shares in the Company at 20p. In the event of the Company failing to raise additional funding of at least £10m, the investor may at its option and at any date falling at least 6 weeks after completion of the first tranche, exercise its right to require the Company to redeem all, but not part only, of the Loan Note by serving at least 1 month's notice of such intention to require redemption.

The Directors believe the Loan Note will enable the Company to complete an equity funding round ("Equity Funding Round") currently being undertaken, which will enable the Company to complete the commercial roll out of its Turkish operations and the initial commercial roll out of its Chinese operations referred to in previous announcements. It is envisaged that the Company will be able to update the market shortly as to the exact quantum and pricing of the Equity Funding Round.

- ends -

Contact

Phorm Corporation Limited
Mark Williams (analysts & investors) +44 20 7297 2326Lauren Hendry Parsons (media) +65 9656 1592

Liberum Capital +44 20 3100 2222 (Nominated Advisor and Joint Broker)Chris Bowman
Richard Bootle

Mirabaud Securities LLP +44 20 7321 2508 (Joint Broker)
Jason Woollard
Peter Krens

Hudson Sandler +44 20 7796 4133Charlie Jack
Charlie Barker

About Phorm

Phorm is a global personalization technology company that makes content and advertising more relevant to the consumer. Phorm's innovative platform preserves user privacy and delivers a more interesting online experience.

Phorm's industry leading technology enables its ISP partners to offer a new type of online advertising platform and a free consumer internet content feature, ensuring more relevant advertisements and personalized content for opted-in users.

Phorm's advertising platform revolutionizes current standards of online privacy, fully protecting the identity of consumers. Unlike virtually all other targeted advertising propositions, Phorm's solution is completely opt-in. Only those users consenting to the service are profiled and only ever on an anonymous basis.

Phorm's partners include leading Internet Service Providers (ISPs), Publishers, Ad Networks and Advertisers.

Phorm, under a predecessor holding company, was admitted to the AIM market of the London Stock Exchange in 2004 and has over 140 employees and contractors.

For more information, please visit: www.phorm.com