Issue of Equity, Directorate Change, Notice of GM

29 October 2012

Verdes Management plc (AIM: VMP)

Subscriptions to raise £550,000

Board Changes

Notice of General Meeting

Headlines

·; £550,000 before expenses conditionally raised in two subscriptions of 200,000,000 shares and 350,000,000 shares respectively at a price of 0.1p per share

·; Adam Webb becoming interim chairman, John Matthews and Eddie Edmonstone stepping down from the board and Matt Wood joining as a non-executive director

·; a general meeting of the Company to be held at the offices of CMS Corporate Consultants Limited, 201 Temple Chambers, 3-7 Temple Avenue, London EC4Y 0DT on 15 November 2012 at 11 a.m to grant the authorities necessary to enable the second subscription to proceed

Contacts:

Adam Webb 0044 (0) 7943 113 190

Verdes Management plc

John Wakefield/Marc Davies 0044 (0) 117 945 3470

WH Ireland Limited

Introduction

Verdes Management plc ("Verdes" or the "Company") announces that the Company has conditionally raised £550,000 before expenses (approximately £525,000 net of expenses) through the conditional subscription for 550,000,000 new ordinary shares of 0.1p each ("Subscription Shares") by new investors at a price of 0.1p per Subscription Share ("Subscription Price").

As also announced today, the Company is making changes to the Board. Adam Webb will be taking on the role of interim chairman and John Matthews and Eddie Edmonstone have agreed to step down with effect from admission of the first tranche of Subscription Shares ("First Subscription Shares"). In addition, the Company is pleased to announce that Matt Wood will be joining the Board as a non-executive director of the Company with effect from admission of the First Subscription Shares.

A circular will be posted today to Shareholders (the "Circular"). The purpose of the Circular is to convene a general meeting of the Company to be held at the offices of CMS Corporate Consultants Limited, 201 Temple Chambers, 3-7 Temple Avenue, London EC4Y 0DT on 15 November 2012 at 11 a.m. (London Time), at which the Shareholder will be asked to approve the Resolutions. The Directors consider the issue of the Subscription Shares to be in the best interests of the Company and the Shareholders as a whole and they unanimously recommend that you should vote in favour of the Resolutions to be proposed at the General Meeting.

Subscriptions

The Company has raised £550,000 before expenses pursuant to the Subscription Agreements under which the Subscribers have conditionally agreed to subscribe for 550,000,000 New Ordinary Shares for cash at 0.1p per New Ordinary Share. The New Ordinary Shares will be issued to persons whose individual holdings will not exceed 29.99 per cent. of the share capital following the allotment of the First Subscription Shares (the "Enlarged Share Capital") or share capital following the allotment of the second tranche of Subscription Shares (the "Further Enlarged Share Capital"). The Subscription Shares will represent approximately 56% of the Further Enlarged Share Capital.

The Subscriptions will be effected in two tranches and both are conditional on the occurrence of certain events. 

First Subscription

The First Subscription is conditional only on admission of the First Subscription Shares to AIM. Application has been made and admission to AIM of the First Subscription Shares is expected to take place at or around 8.00 a.m. on 1 November 2012. The Company has sufficient authorities to allot and issue the First Subscription Shares free of pre-emption rights pursuant to the authorities granted by shareholders at the Company's annual general meeting held on 10 May 2012.

The First Subscription Shares will represent approximately 31.86 per cent. of the Enlarged Share Capital, which will comprise 627,680,735 Ordinary Shares.

Second Subscription

Completion of the Second Subscription is conditional on the passing of the Resolutions at the General Meeting and on admission of the Second Subscription Shares to AIM. Application for admission to AIM of the Second Subscription Shares will be made following the General Meeting if the Resolutions are passed and admission will be expected to occur at or around 8 a.m. on 16 November 2012. The Directors have no reason to believe any application for Subscription Shares to be admitted to trading on AIM will not be accepted.

The Second Subscription Shares represent approximately 35.8 per cent. of the Further Enlarged Share Capital which will comprise 977,680,735 Ordinary Shares.

Use of Proceeds

The net proceeds of the Subscriptions (approximately £525,000) will be used for general working capital by the Company to enable it to explore new business opportunities, specifically in the financial services sector.

Subscribers and Shareholdings following the Subscriptions

Following the issue of the First Subscription Shares, the Subscribers' respective holdings in the Company will be as follows:

Following the Second Subscription, the Subscribers' respective holdings in the Company are expected be as follows:

Following the First Subscription, each of the Subscribers, save Fitel Nominees Limited, will be a significant shareholder, that is one owning at least 3 per cent of the Enlarged Share Capital for the purposes of the AIM Rules and, following the Second Subscription, all of the Subscribers will be significant shareholders. Fitel Nominees Limited holds its shares as nominee of WH Ireland Limited.

Board Changes

John Matthews and Eddie Edmonstone have agreed to step down from the Board with effect from admission of the First Subscription Shares. I would like to personally thank both John and Eddie for their invaluable contribution to the Company over the last two years. I will step up to fulfill the role of chairman in the interim.

The Company also announced today that Matthew Graham Wood (aged 39) is being appointed to the Board as a non-executive director also with effect from admission of the First Subscription Shares.

Matt is an experienced corporate financier and company director. He qualified as a chartered accountant in 1999 and has worked in the City since 2000. He first worked at Beeson Gregory, which became Evolution Securities plc, before co-founding his own advisory firm, CMS Corporate Consultants Limited. He is a director of a number of public and private companies. Matt's current and past directorships in the last five years are as follows:

There are no other disclosures required in accordance with Schedule 2(g) of the AIM Rules in connection with Matt's appointment.

Change of Registered Office

The Company also announced today that its registered office will be changing to 201 Temple Chambers, 3-7 Temple Avenue, London, EC4Y 0DT.

Current trading

The on-going difficult trading conditions have continued to impact the Company's business adversely. We have a number of opportunities for turnaround mandates; however, unfortunately these have not yet been secured. The result is that we have taken the tough decision to downscale our cost base and to reduce our headcount accordingly. The net proceeds of the Subscriptions will be used to explore complementary business opportunities in the financial services sector with a view to generating returns for shareholders.

Resolutions to be proposed

Two resolutions will be proposed at the General Meeting.

Resolution 1, which will be proposed as an ordinary resolution, seeks to grant the directors of the Company authority to allot up to 388,613,002 New Ordinary Shares.

Resolution 2, which will be proposed as a special resolution and is conditional on Resolution 1 being passed, seeks to disapply the pre-emption rights over the 388,613,002 New Ordinary Shares authorised for allotment pursuant to Resolution 1. This will provide the Company with sufficient authority to allot the Second Subscription Shares and additional New Ordinary Shares which it may become contractually obliged to allot under the terms of existing option agreements and warrant agreements.

General Meeting 

The Notice convening the General Meeting at which the Resolutions will be proposed is set out in the Circular (and is available from the Company's website: www.verdes-group.com). The General Meeting will be held at the offices of CMS Corporate Consultants Limited, 201 Temple Chambers, 3-7 Temple Avenue, London EC4Y 0DT on 15 November 2012 at 11 a.m. (London Time) 

Shareholders should be aware that if the Resolutions are not approved at the General Meeting, the Second Subscription will not proceed and the Company may not have sufficient working capital to fund its business operations. Furthermore, in the absence of immediate alternative additional funding, the Company may have to cease business operations, potentially leading to the total loss of shareholder value.