Offer for ISG plc

11 December 2015

FOR IMMEDIATE RELEASE

NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, IN WHOLE OR IN PART, DIRECTLY OR INDIRECTLY IN, INTO OR FROM ANY JURISDICTION WHERE TO DO SO WOULD CONSTITUTE A VIOLATION OF THE RELEVANT LAWS OR REGULATIONS OF THAT JURISDICTION

CASH OFFER

for

ISG PLC

by

CATHEXIS UK HOLDINGS LIMITED

Cathexis UK Holdings Limited ("Cathexis") today announces that it intends to make a cash offer for the entire issued and to be issued ordinary share capital of ISG plc ("ISG") not already owned by Cathexis and its concert parties to be implemented by means of a takeover offer within the meaning of Part 28 of the Companies Act 2006 (the "Offer").

Summary 

· Under the terms of the Offer, holders of ISG Shares who accept the Offer will be entitled to receive:

143 pence in cash for each ISG Share

· The Offer Price values the existing issued ordinary share capital of ISG at approximately £70.8 million in aggregate and represents a premium of approximately 17.2 per cent to the Closing Price of an ISG Share of 122 pence on 10 December 2015, the last Business Day prior to this announcement.

· Cathexis believes that the Offer provides the certainty of a realisable value to ISG Shareholders and allows them to mitigate the inherent risks that the Company's core construction business, by its nature, is unpredictable and prone to extraordinary losses from time to time.

· Cathexis Holdings, the parent company of Cathexis and acting in concert with Cathexis, holds directly or indirectly 14,612,343 ISG Shares, representing approximately 29.53 per cent. of the existing issued ordinary share capital of ISG.

· The Offer will be conditional upon, amongst other things, Cathexis receiving valid acceptances (which have not been withdrawn) in respect of ISG Shares which represent not less than 90 per cent. (or such lower percentage as Cathexis may, subject to the City Code, decide) of the ISG Shares to which the Offer relates and of the voting rights attaching to those shares. However, this condition will not be satisfied unless Cathexis and the Cathexis Group have acquired, or agreed to acquire (whether pursuant to the Offer or otherwise), ISG Shares carrying, in aggregate, more than 50 per cent. of the voting rights then normally exercisable at general meetings of ISG.

This summary should be read in conjunction with, and is subject to, the full text of the following announcement including the Appendices.

Appendix I of this announcement sets out the Conditions of the Offer and certain further terms of the Offer. Appendix II of this announcement contains the sources and bases of certain information used in this summary and in the following announcement. Appendix III of this announcement contains definitions of certain terms used throughout this announcement.

Enquiries: 

Altium (Financial adviser to Cathexis) Tel: +44 (0)207 484 4040

Stephen Georgiadis / Tim Richardson

IMPORTANT NOTES

Altium Capital Limited ("Altium"), which is authorised and regulated in the United Kingdom by the Financial Conduct Authority, is acting as financial adviser exclusively for Cathexis and no-one else in connection with the matters referred to in this announcement and will not regard any other person as its client in relation to such matters and will not be responsible to anyone other than Cathexis for providing the protections afforded to clients of Altium, nor for providing advice in relation to any matter referred to in this announcement.

The Cathexis Directors accept responsibility for the information contained in this announcement relating to Cathexis, save that the only responsibility accepted by the Cathexis Directors in respect of the information in this announcement relating to the ISG Group, which has been compiled from published sources, is to ensure that such information has been correctly and fairly reproduced and presented. To the best of the knowledge and belief of the Cathexis Directors (who have taken all reasonable care to ensure that such is the case), the information contained in this announcement for which they accept responsibility is in accordance with the facts and does not omit anything likely to affect the import of such information.

This announcement is for information purposes only. It is not intended to and does not constitute, or form part of, any offer or invitation or the solicitation of any offer to sell or purchase any securities or the solicitation of any offer to otherwise acquire, subscribe for, sell or otherwise dispose of any security pursuant to the Offer or otherwise. The Offer will be made solely by the Offer Document (together with, in the case of ISG Shares in certificated form, the Form of Acceptance), which will contain the full terms and conditions of the Offer, including details of how the Offer may be accepted. ISG Shareholders should carefully read the Offer Document (and, if they hold their ISG Shares in certificated form, the Form of Acceptance) in its entirety before making a decision with respect to the Offer.

The Offer will be subject to the Conditions and further terms set out in this announcement and to the full terms and conditions that will be set out in the Offer Document and, in respect of ISG Shares held in certificated form, the Form of Acceptance.

It is intended that the Offer Document and Form of Acceptance containing further details of the Offer will be despatched to ISG Shareholders (other than to persons in a Restricted Jurisdiction) as soon as practicable and, in any event, not later than 28 days after the date of this announcement (unless agreed otherwise with the Panel). 

This announcement does not constitute a prospectus or prospectus equivalent document.

Overseas jurisdictions

The release, publication or distribution of this announcement in, and the availability of the Offer to persons who are residents, citizens or nationals of, jurisdictions other than the United Kingdom may be restricted by laws and/or regulations of those jurisdictions. Therefore any persons who are subject to the laws and regulations of any jurisdiction other than the United Kingdom should inform themselves about and observe any applicable requirements in their jurisdiction. Any failure to comply with the applicable requirements may constitute a violation of the laws and/or regulations of any such jurisdiction. In particular, copies of this announcement and any formal documentation relating to the Offer are not being, and must not be, directly or indirectly, mailed or otherwise forwarded, distributed or sent in or into or from any Restricted Jurisdiction and persons receiving such documents (including custodians, nominees and trustees) must not mail or otherwise forward, distribute or send it in or into or from any Restricted Jurisdiction. Unless otherwise permitted by applicable law and regulation, the Offer may not be made, directly or indirectly, in or into, or by the use of mails or any means or instrumentality (including, but not limited to, facsimile, e-mail or other electronic transmission, telex or telephone) of interstate or foreign commerce of, or of any facility of a national, state or other securities exchange of any Restricted Jurisdiction and the Offer may not be capable of acceptance by any such use, means, instrumentality or facilities.

This announcement has been prepared for the purpose of complying with English law, the City Code and the AIM Rules, and information disclosed may not be the same as that which would have been disclosed if this announcement had been prepared in accordance with the laws of jurisdictions outside of England and Wales.

Forward-looking statements

This announcement, including the information included in this announcement, contains certain forward-looking statements. The forward-looking statements contained herein include statements about the expected effects of the Offer on Cathexis and the ISG Group, strategic options, the expected timing and scope of the Offer, and all other statements in this announcement other than historical facts. These statements are based on the current expectations and are naturally subject to uncertainty and changes in circumstances. Forward-looking statements often use words such as "anticipate", "target", "expect", "estimate", "intend", "plan", "budget", "schedule", "forecast", "project", "goal", "believe", "hope", "aims", "continue", "will", "may", "should", "would", "could", "subject to", or other words of similar meaning. By their nature, forward-looking statements involve known and unknown risks and uncertainties, because they relate to events and depend on circumstances that will occur in the future. There are a number of factors that could cause actual results, outcomes and developments to differ materially from those expressed in, or implied by, such forward-looking statements and such statements are therefore qualified in their entirety by the risks and uncertainties surrounding these future expectations. Many of these risks and uncertainties relate to factors that are beyond the entities' ability to control or estimate precisely, such as, but not limited to, general business and market conditions both globally and locally, political, economic and regulatory forces, industry trends and competition, future exchange and interest rates, changes in government and regulation including in relation to health and safety, the environment, labour relations and tax rates and future business combinations or dispositions. Although it is believed that the expectations reflected in such forward-looking statements are reasonable, Cathexis cannot give any assurance, representation or guarantee that such expectations will prove to have been correct and such forward-looking statements should be construed in light of such factors and you are therefore cautioned not to place reliance on these forward-looking statements which speak only as at the date of this announcement. Cathexis assumes no obligation to update or correct the information contained in this announcement (whether as a result of new information, future events or otherwise), except as required by applicable law or regulation.

No profit forecasts

No statement in this announcement is intended as a profit forecast or estimate for any period and no statement in this announcement should be interpreted to mean that earnings or earnings per share for ISG for the current or future financial years would necessarily match or exceed the historical published earnings or earnings per share for ISG.

Dealing and Opening Position Disclosure requirements

Under Rule 8.3(a) of the City Code, any person who is interested in 1 per cent. or more of any class of relevant securities of an offeree company or of any securities exchange offeror (being any offeror other than an offeror in respect of which it has been announced that its offer is, or is likely to be, solely in cash) must make an Opening Position Disclosure following the commencement of the Offer Period and, if later, following the announcement in which any securities exchange offeror is first identified.

An Opening Position Disclosure must contain details of the person's interests and short positions in, and rights to subscribe for, any relevant securities of each of (i) ISG and (ii) any securities exchange offeror(s). An Opening Position Disclosure by a person to whom Rule 8.3(a) applies must be made by no later than 3.30 pm (London time) on the 10th Business Day following the commencement of the Offer Period and, if appropriate, by no later than 3.30 pm (London time) on the 10th Business Day following the announcement in which any securities exchange offeror is first identified. Relevant persons who deal in the relevant securities of ISG or of a securities exchange offeror prior to the deadline for making an Opening Position Disclosure must instead make a Dealing Disclosure.

Under Rule 8.3(b) of the City Code, any person who is, or becomes, interested in 1 per cent. or more of any class of relevant securities of ISG or of any securities exchange offeror must make a Dealing Disclosure if the person deals in any relevant securities of ISG or of any securities exchange offeror. A Dealing Disclosure must contain details of the dealing concerned and of the person's interests and short positions in, and rights to subscribe for, any relevant securities of each of (i) ISG and (ii) any securities exchange offeror, save to the extent that these details have previously been disclosed under Rule 8. A Dealing Disclosure by a person to whom Rule 8.3(b) applies must be made by no later than 3.30 pm (London time) on the Business Day following the date of the relevant dealing.

If two or more persons act together pursuant to an agreement or understanding, whether formal or informal, to acquire or control an interest in relevant securities of an offeree company or a securities exchange offeror, they will be deemed to be a single person for the purpose of Rule 8.3 of the City Code.

Opening Position Disclosures must also be made by ISG and by any offeror and Dealing Disclosures must also be made by ISG, by any offeror and by any persons acting in concert with any of them (see Rules 8.1, 8.2 and 8.4 of the City Code).

Details of the offeree and offeror companies in respect of whose relevant securities Opening Position Disclosures and Dealing Disclosures must be made can be found in the Disclosure Table on the Panel's website at www.thetakeoverpanel.org.uk, including details of the number of relevant securities in issue, when the Offer Period commenced and when any offeror was first identified. You should contact the Panel's Market Surveillance Unit on +44 (0) 20 7638 0129 if you are in any doubt as to whether you are required to make an Opening Position Disclosure or a Dealing Disclosure.

Purchases outside the Offer

Cathexis or its nominees or brokers (acting as agents) may purchase ISG Shares otherwise than under the Offer, such as in the open market or through privately negotiated purchases. Such purchases shall comply with the City Code and the rules of the London Stock Exchange.

Publication on website

A copy of this announcement and other documents in connection with the Offer will, subject to certain restrictions relating to persons resident in Restricted Jurisdiction, be made available on Cathexis' website at www.cathexisinfo.com by no later than 12 noon (London time) on the Business Day following the date of the relevant announcement or document, pursuant to Rule 26.1 of the City Code. The contents of the website referred to in this announcement are not incorporated into, and do not form part of, this announcement.

Information relating to ISG Shareholders

Please be aware that addresses, electronic addresses and certain information provided by ISG Shareholders, persons with information rights and other relevant persons for the receipt of communications from ISG may be provided to Cathexis during the Offer Period as requested under Section 4 of Appendix 4 of the City Code to comply with Rule 2.12(c) of the City Code.

NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, IN WHOLE OR IN PART, DIRECTLY OR INDIRECTLY IN, INTO OR FROM ANY JURISDICTION WHERE TO DO SO WOULD CONSTITUTE A VIOLATION OF THE RELEVANT LAWS OR REGULATIONS OF THAT JURISDICTION

CASH OFFER

for

ISG PLC

by

CATHEXIS UK HOLDINGS LIMITED

11 December 2015

1. Introduction

Cathexis UK Holdings Limited ("Cathexis") today announces that it intends to make a cash offer for the entire issued and to be issued ordinary share capital of ISG plc ("ISG") not already owned by Cathexis and its concert parties to be implemented by means of a takeover offer within the meaning of Part 28 of the Companies Act 2006 (the "Offer").

2. The Offer

Under the terms of the Offer, which will be subject to the Conditions and further terms set out in Appendix I to this announcement and to the full terms and conditions to be set out in the Offer Document and, in respect of ISG Shares held in certificated form, the Form of Acceptance, ISG Shareholders shall be entitled to receive:

143 pence in cash for each ISG Share

The Offer Price values the existing issued ordinary share capital of ISG at approximately £70.8 million in aggregate and represents a premium of approximately 17.2 per cent to the Closing Price of an ISG Share of 122 pence on 10 December 2015, the last Business Day prior to this announcement.

The ISG Shares will be acquired pursuant to the Offer fully paid and free from all liens, charges, equitable interests, encumbrances, rights of pre-emption and any other rights and interests of any nature whatsoever and together with all rights now and hereafter attaching thereto, including voting rights and the right to receive and retain in full all dividends and other distributions (if any) declared, made or paid on or after the date of this announcement.

3. Background to and reasons for the Offer

The Cathexis Group has been an investor in ISG since March 2012 and is currently interested in 29.53 per cent. of the issued ISG Shares. The Cathexis Group has been a supportive, long-term shareholder of the Company since its original investment and its knowledge of the Company and its industry has grown over time.

During the period in which the Cathexis Group has been a shareholder, the Company's trading performance has been characterized by significant volatility, which has been reflected in the price of the ISG Shares. In Cathexis' view, the recent trading update released by the Company on 1 December 2015 (the "Profit Warning"), following which the price of an ISG Share fell by 32.1* per cent., substantiates this view and highlights again how unpredictable the Company's trading performance can be.

Due to the size of the Company, the nature of its business, the cyclicality of its markets and the volatility of its share price and trading performance, Cathexis believes that the Company's ongoing development is more suited to private ownership than a public market listing. Cathexis believes that this will enable the Company to procure financial resources to allow it to invest in the most attractive growth opportunities, enhance the Company's long-term strategic potential and allow its management to focus on growth.

In June 2015, the Cathexis Group approached the ISG Board with an offer proposal and sought a recommendation. However, the Cathexis Group was informed that its approach "very significantly undervalued the Company". In light of this feedback, the Cathexis Group did not proceed further with an offer at the time. However, following the Profit Warning, it has reaffirmed its conclusion that ISG ought to be a private company. Cathexis also believes that it is appropriate to make the Offer directly to ISG Shareholders in order that they may evaluate it individually, based upon their own investment position and liquidity needs.

Cathexis's preferred position would be to acquire all of the issued and to be issued ISG Shares and to cancel the admission of the ISG Shares to trading on AIM, but it is willing to assume the role of reference shareholder in the AIM listed entity and maintain the admission, provided that it holds in excess of 50 per cent. of the Company's voting rights and can provide the requisite long term stability. The Cathexis Group highlights that it has already proved its willingness to support the Company and its management by subscribing for circa 62.0 per cent. of the new ISG Shares issued in the fundraising undertaken by the Company in March 2015.

Cathexis believes the Offer fairly reflects the strength of the Company's market position, reputation and management team but also takes into account the highly cyclical nature of its business, its volatile historical performance and, in Cathexis's view, its significant customer concentration. Cathexis believes the Offer provides the certainty of a realisable value to ISG Shareholders and allows them to mitigate the inherent risks that the Company's core construction business, by its nature, is unpredictable and prone to extraordinary losses from time to time.

By making the Offer, Cathexis is providing ISG Shareholders with the opportunity to realise all (or part) of their investment in highly illiquid ISG Shares for cash with no transaction commissions or fees.

After the Profit Warning, the Cathexis Group acquired a further 2,000,000 ISG Shares in the market at an average price of 142 pence per ISG Share. Following these purchases, the Cathexis Group's resultant holding of ISG Shares is such that it has very limited ability to make additional market purchases of ISG Shares without triggering a mandatory offer under Rule 9 of the City Code.

Cathexis believes that, in the absence of a source of liquidity such as the Offer, significant ISG Shareholders are unlikely to be able to realise their shareholdings in the Company without accepting a material discount to the prevailing share price. 

* Closing Price of an ISG Share on 1 December 2015 of 139.5 pence, compared to the Closing Price of an ISG Share on 30 November 2015 of 205.5 pence.

4. Information about Cathexis and the Cathexis Group

Cathexis is a private limited company incorporated in England and Wales on 8 December 2015 under the Companies Act with registered number 9907825. It is a newly incorporated company formed for the purpose of implementing the Offer.

Cathexis is a wholly-owned subsidiary of Cathexis Holdings, the parent company of an investment group, headquartered in Texas, USA, with the flexibility to invest across a broad range of industries, geographies and deal structures. It can invest in public and private companies and works with management teams to create value. It is a long term investor and has invested in sectors including energy, real estate, consumer products and other industries.

Cathexis Holdings is ultimately beneficially owned and controlled by Mr William Bruce Harrison, an American citizen.

5. Information about ISG

ISG is a UK incorporated international construction services company which, along with its subsidiaries, engages in providing fit out, refurbishment, construction, engineering, design and project management services to clients in the UK, Continental Europe, the Middle East, South Africa and Asia. ISG Shares are admitted to trading on AIM.

In the year ended 30 June 2015, ISG reported a loss before tax of £12.9 million (Profit before tax in the year ended 30 June 2014: £6.8 million) on revenue of £1,648 million (2014: £1,483 million.) As at 30 June 2015, ISG had consolidated net assets of £56.9 million (30 June 2014: £40.1 million).

6. Management, employees and locations

Cathexis attaches great importance to the skills, expertise and knowledge of the existing management and employees of ISG.

Cathexis confirms that if the Offer is declared unconditional in all respects, it intends to honour the existing employment and pension rights of all ISG's management and employees in accordance with applicable law and to comply with ISG's pension obligations for existing employees and members of ISG's pension schemes.

If the Offer becomes, or is declared, unconditional in all respects, Cathexis would expect to nominate new non-executive directors to the Board of ISG.

In the event that Cathexis acquires ISG Shares carrying at least 75 per cent. of the voting rights attaching to the ordinary shares capital of ISG, whether pursuant to the Offer or otherwise, and subject to any requirements of the AIM Rules, it intends to apply to the London Stock Exchange to cancel the admission to trading on AIM of the ISG Shares.

Cathexis has no firm intentions to change the location of ISG's places of business or to redeploy the fixed assets or employees of ISG. It is intended that, upon the Offer becoming or being declared wholly unconditional, Cathexis will conduct with management a strategic and operational review of the existing resources of ISG to identify opportunities.

7. ISG share incentive schemes

The Offer shall extend to any ISG Shares which are unconditionally allotted or issued and fully paid under the ISG Share Option Schemes, the ISG Share Incentive Schemes and any other share incentive schemes of ISG before the date on which the Offer closes.

If the Offer becomes unconditional in all respects, Cathexis intends to make such appropriate proposals as it is required to make pursuant to Rule 15 of the City Code to participants in the ISG Share Option Schemes, the ISG Share Incentive Schemes and any other share incentive schemes of ISG.

8. Financing of the Offer

The Offer will be financed from the existing cash resources of the Cathexis Group.

Altium, as financial adviser to Cathexis, is satisfied that sufficient cash resources are available to Cathexis to satisfy the cash consideration payable to ISG Shareholders in the event of full acceptance of the Offer.

9. ISG Shares to which the Offer relates

The Offer shall extend to the ISG Shares not already owned by Cathexis and its concert parties, which represent approximately 29.53 per cent. of ISG's existing issued ordinary share capital.

In addition, the Offer shall extend to any ISG Shares which are unconditionally allotted or issued and fully paid (or credited as fully paid) on or before the date on which the Offer closes as to acceptances (or such earlier date as Cathexis may, subject to the City Code, decide) including any such ISG Shares allotted or issued pursuant to the exercise of existing options, warrants or awards granted under the ISG Share Option Schemes, the ISG Share Incentive Schemes and any other share incentive schemes of ISG.

10. Disclosure of Interests in Relevant Securities

In this paragraph 10, "Relevant Securities'' means ISG Shares and securities convertible into, or rights to subscribe for, options (including traded options) in respect thereof and derivatives referenced thereto.

As at the close of business on 10 December 2015 (being the last Business Day prior to the publication of this announcement), Cathexis and its concert parties had the following interests in or rights to subscribe for Relevant Securities:

* wholly owned subsidiaries of Cathexis Holdings, the parent company of Cathexis.

As at the close of business on 10 December 2015 (being the last business day prior to the publication of this announcement), save as disclosed in this announcement, neither Cathexis nor any of its concert parties:

Furthermore, save as disclosed in this announcement, no arrangement exists with Cathexis or any of its concert parties in relation to Relevant Securities. For these purposes, an "arrangement" includes any indemnity or option arrangement, any agreement or any understanding, formal or informal, of whatever nature, relating to Relevant Securities which may be an inducement to deal or refrain from dealing in such securities.

11. Opening Position Disclosure

Cathexis confirms that it will today make a public Opening Position Disclosure setting out the details required to be disclosed by it under Rule 8.1(a) of the City Code.

12. Further terms and conditions of the Offer

The Offer is to be effected by means of a takeover offer within the meaning of Part 28 of the 2006 Act.

The Offer will be subject to the Conditions and further terms set out in this announcement and to the full terms and conditions to be set out in the Offer Document and, in respect of ISG Shares held in certificated form, the Form of Acceptance.

The Offer and acceptances thereof will be governed by English law and will be subject to the jurisdiction of the English courts. The Offer will be subject to the applicable requirements of the City Code, the Panel and the AIM Rules.

13. Cancellation of trading on AIM, compulsory acquisition and re-registration

If the Offer becomes, or is declared, unconditional in all respects and Cathexis receives valid acceptances in respect of ISG Shares which, together with the ISG Shares owned, or agreed to be acquired, before or during the Offer by Cathexis and its concert parties, represent not less than 75 per cent. of the voting rights attaching to the ISG Shares, Cathexis intends to procure that ISG will make an application for the cancellation of the admission to trading on AIM of the ISG Shares.

If such an application is made, it is expected that cancellation of admission to trading on AIM will take effect no earlier than 20 Business Days after the date on which Cathexis have, by virtue of their shareholdings and acceptances of the Offer, acquired, or agreed to acquire, 75 per cent. of the voting rights attaching to the ISG Shares. Cathexis will request that ISG makes a regulatory announcement when the necessary 75 per cent. threshold has been reached confirming that the notice period has commenced and the anticipated date of cancellation.

Cancellation of the admission to trading on AIM is likely to reduce significantly the liquidity and marketability of any ISG Shares in respect of which the Offer has not at such time been accepted.

If the Offer becomes, or is declared, unconditional in all respects and Cathexis receives acceptances of the Offer in respect of, and/or otherwise acquires (together with those acting in concert with it), 90 per cent. or more of the ISG Shares to which the Offer relates and 90 per cent. or more of the voting rights attaching to such shares, Cathexis intends to exercise its rights pursuant to sections 974 to 991 of the 2006 Act to acquire compulsorily, on the same terms as the Offer, the remaining ISG Shares in respect of which the Offer has not at such time been accepted.

It is also intended that, if the Offer becomes, or is declared, unconditional in all respects, and Cathexis receives valid acceptances in respect of ISG Shares which, together with the ISG Shares acquired, or agreed to be acquired, before or during the Offer by Cathexis, represent not less than 75 per cent. of the voting rights attaching to the ISG Shares, Cathexis will seek to re-register ISG as a private limited company.

14. Overseas ISG Shareholders

The availability of the Offer to ISG Shareholders who are not resident in the UK may be affected by the laws and/or regulations of their relevant jurisdiction. Therefore, such persons should inform themselves about and observe any applicable legal or regulatory requirements in their jurisdiction. Further details in relation to overseas ISG Shareholders will be set out in the Offer Document. If you are in any doubt, you should consult your professional adviser in the relevant jurisdiction without delay.

15. Documents on display

Copies of this announcement will, by no later than 12 noon on the Business Day following the date of this announcement, be published on Cathexis's website at www.cathexisinfo.com and will be available for inspection on such website until the end of the Offer Period.

16. Expected timetable

It is intended that the Offer Document containing further details of the Offer and the Form of Acceptance will be dispatched to ISG Shareholders (other than to persons in a Restricted Jurisdiction) as soon as practicable and, in any event, not later than 28 days after the date of this announcement (unless agreed otherwise with the Panel).

17. General

Your attention is drawn to the further information contained in the Appendices, which form part of, and should be read in conjunction with, this announcement.

Please be aware that addresses, electronic addresses and certain other information provided by ISG Shareholders, persons with information rights and other relevant persons in connection with the receipt of communications from ISG may be provided to Cathexis during the course of the Offer Period as required under Section 4 of Appendix 4 of the City Code.

Enquiries:

Altium (Financial adviser to Cathexis) Tel: +44 (0)207 484 4040

Stephen Georgiadis / Tim Richardson

IMPORTANT NOTES

Altium Capital Limited ("Altium"), which is authorised and regulated in the United Kingdom by the Financial Conduct Authority, is acting as financial adviser exclusively for Cathexis and no-one else in connection with the matters referred to in this announcement and will not regard any other person as its client in relation to such matters and will not be responsible to anyone other than Cathexis for providing the protections afforded to clients of Altium, nor for providing advice in relation to any matter referred to in this announcement.

This announcement is for information purposes only. It is not intended to and does not constitute, or form part of, any offer or invitation or the solicitation of any offer to sell or purchase any securities or the solicitation of any offer to otherwise acquire, subscribe for, sell or otherwise dispose of any security pursuant to the Offer or otherwise. The Offer will be made solely by the Offer Document (together with, in the case of ISG Shares in certificated form, the Form of Acceptance), which will contain the full terms and conditions of the Offer, including details of how the Offer may be accepted. ISG Shareholders should carefully read the Offer Document (and, if they hold their ISG Shares in certificated form, the Form of Acceptance) in its entirety before making a decision with respect to the Offer.

This announcement does not constitute a prospectus or prospectus equivalent document.

The Cathexis Directors accept responsibility for the information contained in this announcement relating to Cathexis, save that the only responsibility accepted by the Cathexis Directors in respect of the information in this announcement relating to the ISG Group, which has been compiled from published sources, is to ensure that such information has been correctly and fairly reproduced and presented. To the best of the knowledge and belief of the Cathexis Directors (who have taken all reasonable care to ensure that such is the case), the information contained in this announcement for which they accept responsibility is in accordance with the facts and does not omit anything likely to affect the import of such information.

Overseas jurisdictions

The release, publication or distribution of this announcement in, and the availability of the Offer to persons who are residents, citizens or nationals of, jurisdictions other than the United Kingdom may be restricted by laws and/or regulations of those jurisdictions. Therefore any persons who are subject to the laws and regulations of any jurisdiction other than the United Kingdom should inform themselves about and observe any applicable requirements in their jurisdiction. Any failure to comply with the applicable requirements may constitute a violation of the laws and/or regulations of any such jurisdiction. In particular, copies of this announcement and any formal documentation relating to the Offer are not being, and must not be, directly or indirectly, mailed or otherwise forwarded, distributed or sent in or into or from any Restricted Jurisdiction and persons receiving such documents (including custodians, nominees and trustees) must not mail or otherwise forward, distribute or send it in or into or from any Restricted Jurisdiction. Unless otherwise permitted by applicable law and regulation, the Offer may not be made, directly or indirectly, in or into, or by the use of mails or any means or instrumentality (including, but not limited to, facsimile, e-mail or other electronic transmission, telex or telephone) of interstate or foreign commerce of, or of any facility of a national, state or other securities exchange of any Restricted Jurisdiction and the Offer may not be capable of acceptance by any such use, means, instrumentality or facilities.

This announcement has been prepared for the purpose of complying with English law, the City Code and the AIM Rules, and information disclosed may not be the same as that which would have been disclosed if this announcement had been prepared in accordance with the laws of jurisdictions outside of England and Wales.

Forward-looking statements

This announcement, including the information included in this announcement, contains certain forward-looking statements. The forward-looking statements contained herein include statements about the expected effects of the Offer on Cathexis and the ISG Group, strategic options, the expected timing and scope of the Offer, and all other statements in this announcement other than historical facts. These statements are based on the current expectations and are naturally subject to uncertainty and changes in circumstances. Forward-looking statements often use words such as "anticipate", "target", "expect", "estimate", "intend", "plan", "budget", "schedule", "forecast", "project", "goal", "believe", "hope", "aims", "continue", "will", "may", "should", "would", "could", "subject to", or other words of similar meaning. By their nature, forward-looking statements involve known and unknown risks and uncertainties, because they relate to events and depend on circumstances that will occur in the future. There are a number of factors that could cause actual results, outcomes and developments to differ materially from those expressed in, or implied by, such forward-looking statements and such statements are therefore qualified in their entirety by the risks and uncertainties surrounding these future expectations. Many of these risks and uncertainties relate to factors that are beyond the entities' ability to control or estimate precisely, such as, but not limited to, general business and market conditions both globally and locally, political, economic and regulatory forces, industry trends and competition, future exchange and interest rates, changes in government and regulation including in relation to health and safety, the environment, labour relations and tax rates and future business combinations or dispositions. Although it is believed that the expectations reflected in such forward-looking statements are reasonable, Cathexis cannot give any assurance, representation or guarantee that such expectations will prove to have been correct and such forward-looking statements should be construed in light of such factors and you are therefore cautioned not to place reliance on these forward-looking statements which speak only as at the date of this announcement. Cathexis assumes no obligation to update or correct the information contained in this announcement (whether as a result of new information, future events or otherwise), except as required by applicable law or regulation.

Dealing and Opening Position Disclosure requirements

Under Rule 8.3(a) of the City Code, any person who is interested in 1 per cent. or more of any class of relevant securities of an offeree company or of any securities exchange offeror (being any offeror other than an offeror in respect of which it has been announced that its offer is, or is likely to be, solely in cash) must make an Opening Position Disclosure following the commencement of the Offer Period and, if later, following the announcement in which any securities exchange offeror is first identified.

An Opening Position Disclosure must contain details of the person's interests and short positions in, and rights to subscribe for, any relevant securities of each of (i) ISG and (ii) any securities exchange offeror(s). An Opening Position Disclosure by a person to whom Rule 8.3(a) applies must be made by no later than 3.30 pm (London time) on the 10th Business Day following the commencement of the Offer Period and, if appropriate, by no later than 3.30 pm (London time) on the 10th Business Day following the announcement in which any securities exchange offeror is first identified. Relevant persons who deal in the relevant securities of ISG or of a securities exchange offeror prior to the deadline for making an Opening Position Disclosure must instead make a Dealing Disclosure.

Under Rule 8.3(b) of the City Code, any person who is, or becomes, interested in 1 per cent. or more of any class of relevant securities of ISG or of any securities exchange offeror must make a Dealing Disclosure if the person deals in any relevant securities of ISG or of any securities exchange offeror. A Dealing Disclosure must contain details of the dealing concerned and of the person's interests and short positions in, and rights to subscribe for, any relevant securities of each of (i) ISG and (ii) any securities exchange offeror, save to the extent that these details have previously been disclosed under Rule 8. A Dealing Disclosure by a person to whom Rule 8.3(b) applies must be made by no later than 3.30 pm (London time) on the Business Day following the date of the relevant dealing.

If two or more persons act together pursuant to an agreement or understanding, whether formal or informal, to acquire or control an interest in relevant securities of an offeree company or a securities exchange offeror, they will be deemed to be a single person for the purpose of Rule 8.3 of the City Code.

Opening Position Disclosures must also be made by ISG and by any offeror and Dealing Disclosures must also be made by ISG, by any offeror and by any persons acting in concert with any of them (see Rules 8.1, 8.2 and 8.4 of the City Code).

Details of the offeree and offeror companies in respect of whose relevant securities Opening Position Disclosures and Dealing Disclosures must be made can be found in the Disclosure Table on the Panel's website at www.thetakeoverpanel.org.uk, including details of the number of relevant securities in issue, when the Offer Period commenced and when any offeror was first identified. You should contact the Panel's Market Surveillance Unit on +44 (0) 20 7638 0129 if you are in any doubt as to whether you are required to make an Opening Position Disclosure or a Dealing Disclosure.

Purchases outside the Offer

Cathexis or its nominees or brokers (acting as agents) may purchase ISG Shares otherwise than under the Offer, such as in the open market or through privately negotiated purchases. Such purchases shall comply with the City Code and the rules of the London Stock Exchange.

Publication on website

A copy of this announcement and other documents in connection with the Offer will, subject to certain restrictions relating to persons resident in Restricted Jurisdiction, be made available on Cathexis' website at www.cathexisinfo.com by no later than 12 noon (London time) on the Business Day following the date of the relevant announcement or document, pursuant to Rule 26.1 of the City Code. The contents of the website referred to in this announcement are not incorporated into, and do not form part of, this announcement.

Information relating to ISG Shareholders

Please be aware that addresses, electronic addresses and certain information provided by ISG Shareholders, persons with information rights and other relevant persons for the receipt of communications from ISG may be provided to Cathexis during the Offer Period as requested under Section 4 of Appendix 4 of the City Code to comply with Rule 2.12(c) of the City Code.

Appendix I

The Conditions of the Offer and Certain Further Terms of the Offer

Part A: Conditions

The Offer is subject to the following Conditions:

Acceptance Condition

(a) valid acceptances of the Offer being received (and not, where permitted, withdrawn) by no later than 1.00 p.m. (London time) on the First Closing Date of the Offer (or such later time(s) and/or date(s) as Cathexis may, in accordance with the City Code or with the consent of the Panel, decide) in respect of not less than 90 per cent. (or such lesser percentage as Cathexis may decide) of the ISG Shares to which the Offer relates and of the voting rights attached to those shares, including for this purpose (except to the extent otherwise agreed by the Panel) any such voting rights attaching to ISG Shares that are unconditionally allotted or issued before the Offer becomes or is declared unconditional as to acceptances whether pursuant to the exercise of any outstanding subscription or conversion rights or otherwise. However, this condition will not be satisfied unless Cathexis and the Cathexis Group have acquired, or agreed to acquire, ISG Shares carrying, in aggregate, over 50 per cent. of the voting rights then normally exercisable at general meetings of ISG.

For the purposes of this condition:

(i) ISG Shares which have been unconditionally allotted shall be deemed to carry the voting rights they will carry upon being entered into the register of members of ISG;

(ii) ISG Shares that cease to be held in treasury are ISG Shares to which the Offer relates; and

(iii) the expression "ISG Shares to which the Offer relates" shall be construed in accordance with Chapter 3 of Part 28 of the 2006 Act;

Regulatory

(b) all necessary notifications, filings and applications having been made and all applicable waiting and other time periods (including any extensions thereof) having expired, lapsed or been terminated in each case under any applicable legislation and any regulations in any jurisdiction and all statutory or regulatory obligations in any jurisdiction having been complied with in each case in connection with the Offer or its implementation or the acquisition or proposed acquisition of any shares or other securities in, or control or management of, ISG or any other member of the ISG Group by Cathexis or any other member of the Cathexis Group or the carrying on by any member of the ISG Group of its business;

Other third party clearances

(c) no government or governmental, quasi-governmental, supranational, statutory, administrative or regulatory body or association, institution or agency (including any trade agency) or any court or other body (including any professional or environmental body) or person in any jurisdiction (each a "Relevant Authority") having decided to take, institute or threaten any action, proceeding, suit, investigation, enquiry or reference or enacted, made or proposed and there not continuing to be outstanding any statute, regulation, order or decision that would or might reasonably be expected to (in any case which is material in the context of the Offer):

(i) make the acquisition or the proposed acquisition of ISG Shares, or control or management of ISG by Cathexis or any member of the Cathexis Group void, unenforceable or illegal in any jurisdiction or directly or indirectly prohibit or otherwise restrict, delay or interfere with the implementation of, or impose additional conditions or obligations with respect to, or otherwise challenge or require amendment to the terms of, the Offer or the proposed acquisition of any ISG Shares, or control or management of ISG by Cathexis or any member of the Cathexis Group;

(ii) require, prevent or delay the divestiture (or alter the terms of any proposed divestiture) by the Cathexis Group or the ISG Group of all or any part of their respective businesses, assets or properties or impose any limitation on their ability to conduct all or any part of their respective businesses and to own, control or manage any of their respective assets or properties to an extent which is, in any such case, material in the context of the Cathexis Group or the ISG Group taken as a whole;

(iii) impose any limitation on, or result in any delay in, the ability of any member of the Cathexis Group to acquire or hold or to exercise effectively, directly or indirectly, all or any rights of ownership of shares or other securities (or the equivalent) in, or to exercise management control over, any member of the ISG Group or on the ability of the ISG Group to hold or exercise effectively, directly or indirectly, all or any rights of ownership of shares or other securities (or the equivalent) in, or to exercise management control over, any other member of the ISG Group;

(iv) require any member of the Cathexis Group or of the ISG Group to acquire or offer to acquire any shares or other securities (or the equivalent) or interest in any member of the ISG Group or any member of the Cathexis Group owned by a third party (other than in the implementation of the Offer) where such acquisition would be material in the context of the Cathexis Group or the ISG Group taken as a whole;

(v) require the divestiture by any member of the Cathexis Group of any shares, securities or other interests in any member of the ISG Group;

(vi) impose any limitation on, or result in any delay in, the ability of any member of the Cathexis Group or the ISG Group to integrate or co-ordinate its business, or any part of it, with the businesses or any part of the businesses of any other member of the Cathexis Group and/or the ISG Group;

(vii) result in any member of the Cathexis Group or the ISG Group ceasing to be able to carry on business under any name under which it presently does so; or

(viii) otherwise adversely affect the business, assets, financial or trading position or profits or prospects of any member of the Cathexis Group or the ISG Group in each case in a manner which is material in the context of the Cathexis Group or the ISG Group taken as a whole,

and all applicable waiting and other time periods (including extensions thereof) during which any such Relevant Authority could decide to take, institute or threaten any such action, proceeding, suit, investigation, enquiry or reference having expired, lapsed or been terminated;

(d) other than in relation to the anti-trust law and regulatory approvals referred to in paragraphs (b) and (c) above, all material filings, applications and/or notifications which are necessary or reasonably considered appropriate by Cathexis having been made and all relevant waiting periods and other time periods (including any extensions thereof) under any applicable legislation or regulation of any jurisdiction having expired, lapsed or been terminated and all applicable statutory or regulatory obligations in any jurisdiction having been complied with in each case in respect of the Offer and the acquisition or the proposed acquisition of any shares or other securities in, or control or management of, ISG or any member of the ISG Group by any member of the Cathexis Group or the carrying on by any member of the ISG Group of its business;

(e) other than in relation to the competition law and regulatory approvals referred to in paragraphs (b) and (c) above, all material authorisations, orders, grants, recognitions, confirmations, licences, consents, clearances, permissions and approvals which are necessary or reasonably considered appropriate by Cathexis in any jurisdiction for or in respect of the Offer and the proposed acquisition of ISG Shares, or control of ISG, by Cathexis or any member of the Cathexis Group being obtained on terms and in a form reasonably satisfactory to Cathexis from appropriate Relevant Authorities, or from any persons or bodies with whom any member of the Cathexis Group or the ISG Group has entered into contractual arrangements or other material business relationships, and such authorisations, orders, grants, recognitions, confirmations, licences, consents, clearances, permissions and approvals, together with all authorisations, orders, grants, recognitions, confirmations, licences, consents, clearances, permissions and approvals necessary or reasonably considered appropriate for any member of the ISG Group to carry on its business, remaining in full force and effect and no intimation of any intention to revoke, suspend, restrict or modify or not to renew any of the same having been made and all necessary statutory or regulatory obligations in any jurisdiction having been complied with;

Confirmation of absence of adverse circumstances

(f) except as Disclosed, there being no provision of any agreement, arrangement, licence or other instrument to which any member of the ISG Group is a party or by or to which any such member or any of its assets is or may be bound, entitled or subject which, as a result of the implementation of the Offer or the acquisition or proposed acquisition by Cathexis or any member of the Cathexis Group of any ISG Shares, or change in the control or management of ISG or otherwise, would or might reasonably be expected to result in (in each case to an extent which is material in the context of the ISG Group taken as a whole):

(i) any monies borrowed by or any other indebtedness (actual or contingent) of, or any grant available to, any member of the ISG Group becoming repayable, or capable of being declared repayable, immediately or earlier than the stated repayment date or the ability of such member to borrow monies or incur any indebtedness being withdrawn or inhibited;

(ii) the creation or enforcement of any mortgage, charge or other security interest over the whole or any material part of the business, property or assets of any member of the ISG Group or any such mortgage, charge or other security interest (whenever arising or having arisen) becoming enforceable;

(iii) any assets or interest of the ISG Group being or falling to be disposed of or ceasing to be available to any member of the ISG Group or any right arising under which any such asset or interest could be required to be disposed of or could cease to be available to any member of the ISG Group;

(iv) the interest or business of any member of the ISG Group in or with any other person, firm or company (or any agreements or arrangements relating to such interest or business) being terminated or adversely modified or affected;

(v) any member of the ISG Group ceasing to be able to carry on business under any name under which it presently does so;

(vi) the value of any member of the ISG Group or its financial or trading position or prospects being prejudiced or adversely affected;

(vii) any such agreement, arrangement, licence or other instrument being terminated or adversely modified or any onerous obligation arising or any adverse action being taken or arising thereunder;

(viii) the creation of any material liabilities (actual or contingent) by any member of the ISG Group; or

(ix) any requirement on any member of the ISG Group to acquire, subscribe, pay up or repay any shares or other securities (or the equivalent);

and no event having occurred which, under any provision of any agreement, arrangement, licence or other instrument to which any member of the ISG Group is a party or by or to which any such member or any of its assets may be bound or be subject, will result in any events or circumstances as are referred to in this paragraph (f);

No material transactions, claims or changes in the conduct of the business of ISG:

(g) except as Disclosed, no member of the ISG Group has:

(i) issued or agreed to issue or authorised or proposed the issue of additional shares of any class, or securities convertible into, or exchangeable for, or rights, warrants or options to subscribe for or acquire, any such shares or convertible or exchangeable securities or transferred or sold (or agreed to transfer or sell) any shares out of treasury (except, where relevant, as between ISG and its wholly owned subsidiaries or between its wholly owned subsidiaries);

(ii) recommended, declared, paid or made or resolved to recommend, declare, pay or make any bonus, dividend or other distribution, whether payable in cash or otherwise, other than a distribution by a wholly-owned subsidiary of ISG;

(iii) other than pursuant to the Offer, implemented or authorised any merger or demerger or (except for transactions between ISG and its wholly-owned subsidiaries, or between its wholly-owned subsidiaries or transactions in the ordinary course of business) acquired or disposed of or transferred, mortgaged or charged, or created any other security interest over, any asset or any right, title or interest in any asset (in each case to an extent which is material in the context of the ISG Group or in the context of the Offer);

(iv) (except for transactions between ISG and its wholly-owned subsidiaries, or between its wholly-owned subsidiaries or transactions in the ordinary course of business) entered into, or authorised the entry into, any joint venture, asset or profit sharing arrangement, partnership or merger of businesses or corporate entities (in each case to an extent which is material in the context of the ISG Group taken as a whole or in the context of the Offer);

(v) (except for transactions between ISG and its wholly-owned subsidiaries, or between its wholly-owned subsidiaries or transactions in the ordinary course of business) other than pursuant to the Offer, implemented or authorised any reconstruction, amalgamation, scheme or other transaction or arrangement with a substantially equivalent effect (in each case to an extent which is material in the context of the ISG Group taken as a whole or in the context of the Offer);

(vi) (except for transactions between ISG and its wholly-owned subsidiaries, or between its wholly-owned subsidiaries or transactions in the ordinary course of business) purchased, redeemed or repaid any of its own shares or other securities or reduced or made or authorised any other change in its share capital;

(vii) (except for transactions between ISG and its wholly owned subsidiaries or between its wholly owned subsidiaries) made or authorised any change in its loan capital or issued or authorised the issue of any debentures or incurred or increased any indebtedness or contingent liability (in each case to an extent which is material in the context of the ISG Group taken as a whole or in the context of the Offer);

(viii) entered into, varied or terminated, or authorised the entry into, variation or termination of, any contract, commitment or arrangement (whether in respect of capital expenditure, real estate or otherwise) which is outside the ordinary course of business or which is of a long term, onerous or unusual nature or magnitude or which involves, or might reasonably be expected to involve, an obligation of a nature or magnitude which is restrictive on the business of any member of the ISG Group (in each case to an extent which is material in the context of the ISG Group taken as a whole or in the context of the Offer);

(ix) been unable or deemed unable, or admitted in writing that it is unable, to pay its debts as they fall due or having stopped or suspended (or threatened to stop or suspend) payment of its debts generally or ceased or threatened to cease carrying on all or a substantial part of its business;

(x) commenced negotiations with any of its creditors or taken any step with a view to rescheduling or restructuring any of its indebtedness or entered into a composition, compromise, assignment or arrangement with any of its creditors whether by way of a voluntary arrangement, scheme of arrangement, deed of compromise or otherwise;

(xi) (other than in respect of a subsidiary of ISG which is dormant and solvent at the relevant time) taken any corporate action or had any legal proceedings started, served or threatened against it or any documents filed or faxed in court for its winding-up (voluntary or otherwise), dissolution or reorganisation (or for any analogous proceedings or steps in any jurisdiction) or for the appointment of a liquidator, provisional liquidator, receiver, administrator, administrative receiver, trustee or similar officer (or for the appointment of any analogous person in any jurisdiction) of all or any of its assets and revenues or had notice given of the intention to appoint any of the foregoing to it (in each case to an extent which is material in the context of the ISG Group taken as a whole or in the context of the Offer);

(xii) except in the ordinary course of business, waived, compromised, settled, abandoned or admitted any dispute, claim or counter-claim whether made or potential and whether by or against any member of the ISG Group (in each case other than in the ordinary course of business and to an extent which is material in the context of the ISG Group taken as a whole or in the context of the Offer);

(xiii) made any material alteration to its constitutional documents;

(xiv) entered into, or varied the terms of, or terminated or given notice of termination of, any service agreement or arrangement with any director or senior executive of the ISG Group;

(xv) proposed, agreed to provide, or agreed to modify the terms of, any share option scheme, incentive scheme or other benefit relating to the employment or termination of employment of any person employed by the ISG Group, other than in accordance with the terms of the Offer;

(xvi) made or consented to any material change to the terms of the trust deeds constituting the pension schemes established for its directors and/or employees and/or their dependants or to the benefits which accrue, or to the pensions which are payable thereunder, or to the basis on which qualification for or accrual or entitlement to such benefits or pensions are calculated or determined, or to the basis upon which the liabilities (including pensions) of such pension schemes are funded or made, or agreed or consented to, any change to the trustees, other than in accordance with applicable law;

(xvii) save as between ISG and its wholly-owned subsidiaries, granted any lease in respect of any of the leasehold or freehold property owned or occupied by it or transferred or otherwise disposed of any such property (in each case to an extent which is material in the context of the ISG Group taken as a whole or in the context of the Offer); or

(xviii) entered into any contract, commitment or arrangement or passed any resolution or made any offer (which remains open for acceptance) with respect to, or proposed or announced any intention to effect or propose, any of the transactions, matters or events referred to in this paragraph (g);

(h) except as Disclosed:

(i) no adverse change having occurred, and no circumstances having arisen which would or might reasonably be expected to result in any adverse change in the business, assets, financial or trading position or profits or prospects of any member of the ISG Group (in each case to an extent which is material in the context of the ISG Group taken as a whole or in the context of the Offer); and

(ii) no litigation, arbitration proceedings, prosecution or other legal proceedings in any jurisdiction having been threatened, announced, instituted or remaining outstanding by, against or in respect of any member of the ISG Group or to which any member of the ISG Group is a party (whether as claimant or defendant or otherwise) and no investigation by any Relevant Authority or other investigative body against or in respect of any member of the ISG Group having been threatened, announced, instituted or remaining outstanding by, against or in respect of any member of the ISG Group (in each case to an extent which is material in the context of the ISG Group taken as a whole or in the context of the Offer);

(j) save as Disclosed, no contingent or other liability having arisen outside the ordinary course of business which would or might reasonably be expected to adversely affect ISG (in each case to an extent which is material in the context of the ISG Group taken as a whole or in the context of the Offer);

(k) save as Disclosed, Cathexis not having discovered that:

(i) any financial, business or other information concerning any member of the ISG Group publicly disclosed prior to the date of this announcement at any time by any member of the ISG Group is misleading, contains a misrepresentation of fact or omits to state a fact necessary to make the information contained therein not misleading and which was not subsequently corrected before the date of this announcement by disclosure by, or on behalf of, the ISG Group through the publication of an announcement via a Regulatory Information Service (in each case to an extent which is material in the context of the ISG Group taken as a whole or in the context of the Offer); or

(ii) any member of the ISG Group is subject to any liability, contingent or otherwise, other than in the ordinary course of business (in each case to an extent which is material in the context of the ISG Group taken as a whole or in the context of the Offer);

Anti-corruption and sanctions

(l) except as Disclosed, Cathexis not having discovered that:

(i) any past or present member of the ISG Group or any person that performs or has performed services for or on behalf of any such company is or has at any time engaged in any activity, practice or conduct (or omitted to take any action) in contravention of the UK Bribery Act 2010, the US Foreign Corrupt Practices Act of 1977, as amended or any other applicable anti-corruption legislation; and

(ii) any past or present member of the ISG Group has engaged in any activity or business with, or made any investments in, or made any payments to any government, entity or individual covered by any of the economic sanctions administered by the United Nations or the European Union (or any of their respective member states) or the United States Office of Foreign Assets Control or any other governmental or supranational body or authority in any jurisdiction; and

No criminal property

(m) except as Disclosed, Cathexis not having discovered that any asset of any member of the ISG Group constitutes criminal property as defined by section 340(3) of the Proceeds of Crime Act 2002 (but disregarding paragraph (b) of that definition).

Part B: Certain Further Terms of the Offer

1.1. Subject to the requirements of the Panel, Cathexis reserves the right in its sole discretion to waive (if capable of waiver) in whole or in part all or any of the conditions set out Parts A and B of this Appendix I.

1.2. If Cathexis is required by the Panel to make an offer for ISG Shares under the Provisions of Rule 9 of the City Code, Cathexis may make such alterations to the terms and conditions of the Offer as are necessary to comply with the provisions of that Rule.

1.3. In relation to the Offer, the conditions set out in paragraphs (b) to (m) inclusive of Part A of this Appendix I must be satisfied as at, or (if capable of waiver) waived on or before, midnight on the 21st calendar day after the later of the First Closing Date of the Offer and the date on which the condition set out in paragraph (a) of Part A of this Appendix I is fulfilled (or, in each case, such later date as the Panel may agree), failing which the Offer will lapse. Cathexis shall be under no obligation to waive (if capable of waiver) or determine to be, or treat as, satisfied, any of the conditions set out in paragraph (b) to (m) inclusive of Part A of this Appendix I by a date earlier than the latest date specified above for the satisfaction thereof notwithstanding that the other conditions of the Offer may at such earlier date have been waived or satisfied and that there are, at such earlier date, no circumstances indicating that any of such conditions may not be capable of satisfaction. In any event, all of the Conditions must be satisfied as at, or (if capable of waiver) waived on or before, midnight on the 81st day following the date on which the Offer Document is published or such other date as may be agreed with the Panel.

1.4. Cathexis reserves the right to elect with the consent of the Panel (where necessary) to implement the Offer by way of a court approved scheme of arrangement in accordance with Part 26 of the 2006 Act. In such event, the acquisition will be implemented on substantially the same terms, subject to appropriate amendments, as those which would apply to the Offer.

1.5. ISG Shares will be acquired by Cathexis pursuant to the Offer fully paid with full title guarantee and free from all liens, charges, encumbrances, equitable interests, pre-emption rights and other interests and rights of whatsoever nature and together with all rights now or hereafter attaching thereto, including the right to receive and retain in full all dividends and other distributions (if any) declared, paid or made after the date of this announcement.

1.6. In deciding whether or not to accept the Offer in respect of their ISG Shares, ISG Shareholders should rely on the information contained in, and follow the procedures described in, the Offer Document and (if they hold their ISG Shares in certificated form) the Form of Acceptance which will be posted to ISG Shareholders in due course (other than to any ISG Shareholders with addresses in any Restricted Jurisdiction).

1.7. Save to the extent provided in this announcement, Cathexis will have the right to reduce the consideration payable to ISG Shareholders under the terms of the Offer by the amount of any dividend (or other distribution) payable by ISG to ISG Shareholders.

1.8. The Offer will be made on the terms and will be subject to the Conditions and terms which are set out in this Appendix I, those terms which will be set out in the formal Offer Document and Form of Acceptance and such further terms as may be required to comply with the City Code and applicable law.

1.9. The Offer will comply with the applicable rules and regulations of the London Stock Exchange and the City Code. The Offer and any acceptances thereunder will be governed by English law and will be subject to the jurisdiction of the English Courts.

1.10. The availability of the Offer to persons not resident in the United Kingdom may be affected by the laws of the relevant jurisdictions. Persons who are not resident in the United Kingdom should inform themselves about and observe any applicable requirements.

1.11. The Offer will not be made, directly or indirectly, in or into, or by use of the mails of, or by any means or instrumentality (including, without limitation, facsimile transmission, telex, telephone, internet or e-mail) of interstate or foreign commerce of, or of any facility of a national securities exchange of, any Restricted Jurisdiction and the Offer will not be capable of acceptance by any such use, means, instrumentality or facility or from within, any Restricted Jurisdiction.

Appendix II

Bases of Calculation and Sources of Information

In this announcement, unless otherwise stated or the context otherwise requires, the bases of calculation and sources of information are used as described below:

1. Unless otherwise stated, financial information relating to ISG has been extracted or derived (without any adjustment) from the Annual Report and Accounts of ISG for the year ended 30 June 2015.

2. References to the existing issued ordinary share capital of ISG and the existing issued ISG Shares are to the number of ISG Shares in issue as at 8 December 2015 (as disclosed in the regulatory announcement released by ISG on 4 December 2015), which was 49,483,864 ISG Shares. For the avoidance of doubt, none of the ISG Shares were held in treasury at that date.

3. The International Securities Identification Number for ISG Shares is GB0002925955.

4. Unless otherwise stated, all Closing Prices have been derived from the AIM Appendix to the London Stock Exchange Daily Official List.

Appendix III

Definitions

The following definitions apply throughout this announcement, unless otherwise stated or the context otherwise requires.