Fundraising £50,000 & Conversion of Loan Notes

3 May 2016

CloudTag Inc.

('CloudTag' or 'the Company')

Fundraising £50,000 & Conversion of Loan Notes

CloudTag (CTAG:LN), the company that brings personal monitoring to the health, wellbeing and fitness markets, announces that it has raised a further £50,000 with a new investor through the issue of 1,612,903 new ordinary shares ("Shares") at a price of 3.1 pence per share, representing a premium of 37.8 per cent. over the mid-market closing price of 2.25 pence per share on 29 April 2016. Additionally the Company has converted £200,000 of loan notes into 12,220,000 new ordinary shares as the Company looks to remove debt from its books.

Conversion of Loan Notes and Related Party Transaction

The Company has elected to convert £200,000 plus accrued interest totaling £3,666 of the unsecured convertible loan notes from two directors of the Company originally announced on the 4 December 2014 and 29 September 2015, into 12,220,000 new ordinary shares ("Conversion Shares") comprising of 3,220,000 issued to Tony Reeves and 9,000,000 issued to Gerald Bereika. The conversion terms are those set out in the respective agreements. Conversion is in line with the board's strategy to repay debt so far as possible as it looks to future funding opportunities, including but not limited, to trade finance arrangements.

The repayment of the loan notes in shares to Gerald Bereika is a related party transaction under AIM Rule 13. The Directors, excluding Mr Bereika, having consulted with the company's Nominated Adviser, Cairn Financial Advisers LLP, consider the terms of the transaction to be fair and reasonable insofar as the Company's shareholders are concerned.

Directors' Shareholdings

Following the issue of Conversion Shares their shareholdings in the Company's enlarged issued share capital are set out below.

Application has been made for the admission of the 13,832,903 new ordinary shares to trading on AIM and it is expected that dealings in these shares will commence on or around 10 May 2016.

Following the issue of the new ordinary shares, the total number of ordinary shares in issue is 300,476,154. This number may be used by shareholders as the denominator for the calculation by which they will determine if they are required to notify their interest in, or a change in their interest in, the share capital of the Company.

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