Issue of Convertible Preference Shares

7 November 2019

KINGSWOOD HOLDINGS LIMITED

("Kingswood", the "Company" or the "Group")

Issue of Convertible Preference Shares

Kingswood Holdings Limited (AIM: KWG), the integrated wealth management group, announces that it has today issued a total of 4,827,655 convertible preference shares (the "New Preference Shares"), under the terms of the convertible preference share subscription agreement announced on 12 September 2019, to HSQ INVESTMENT LIMITED ("Pollen Street"), a wholly owned indirect subsidiary of funds managed and/or advised by Pollen Street Capital Limited.

As announced on 1 October 2019, the Company and Pollen Street elected to fund the acquisition of WFI Financial by way of a six-month secured bridge finance facility from Pollen Street, with a 5% rate of interest (the "Bridge Finance Facility"). Pursuant to the terms of the Bridge Finance Facility, Pollen Street has opted to capitalise this facility into Convertible Preference Shares. Accordingly, New Preference Shares have been issued to satisfy the repayment of the Bridge Finance Facility and associated interest.

In addition, a portion of the New Preference Shares are being issued to satisfy deferred consideration to the vendors of Marchant McKechnie Independent Financial Advisers Ltd ("Marchant McKechnie") and associated costs, as set out in the announcement dated 1 October 2018.

The New Preference Shares represent the first tranche of convertible preference shares issued pursuant to the Pollen Street subscription agreement and as such the total number of Convertible Preference Shares held by Pollen Street is 4,827,655.

Gary Wilder, Group CEO at Kingswood, said: 

"This represents the first utilisation of the growth equity facility we have in place with Pollen Street and we look forward to utilising it further as we seek to execute on our acquisition pipeline in the coming months. The Group is committed to maintaining a conservative and robust balance sheet and therefore, wherever possible, capital payments owed by the Company on an ongoing basis will be satisfied through the issue of convertible preference shares to Pollen Street. This will allow the Group to focus on increasing cash balances and strengthening the balance sheet."

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The information communicated in this announcement is inside information for the purposes of Article 7 of Regulation 596/2014