Proposed Fundraising and Notice of General Meeting

Rex Bionics Plc

("Rex Bionics" or the "Company")

Proposed Fundraising and Notice of General Meeting

Placing and Subscription to raise £2.1 million and proposed Additional Fundraising to raise approximately £1.0 million and Share Restructuring

12 June 2015 Rex Bionics Plc (AIM: RBX), the pioneer of the REX Robot technology that enhances the mobility of wheelchair users, today announces a proposed Placing and Subscription of 3,500,000 New Ordinary Shares at a price of 60 pence to raise £2.1 million (before expenses).

Highlights

· 3,500,000 new ordinary shares of 10 pence each in the capital of the Company conditionally placed with or subscribed by institutional and other investors to raise proceeds of £2.1 million before expenses

· Issue price of 60 pence per New Ordinary Share (the "Issue Price"), represents a premium of 6.19 per cent to the mid-market closing price on 11 June 2015

· Seeking a further £1.0 million through the Additional Fundraising from certain identified investors who will be approached before the General Meeting, potentially issuing up to 1,666,667 additional New Ordinary Shares

· The net proceeds of the Fundraising will be used to complete the RAPPER II ("Robot-Assisted PhysiotheraPy Exercises with REX") clinical trial in which the first patient was recently successfully treated; initiate a US clinical trial; appoint distribution partners in the United States, China and other markets - and thus over the next 12 months provide a more complete body of clinical and commercial evidence of REX's significant value creation potential

· Proposal to sub-divide each Existing Ordinary Share into one Redenominated Ordinary Share of 10 pence and one Deferred Share of 90 pence to reduce the nominal value of each Existing Ordinary Share to facilitate fundraising

· Stifel is acting as Financial Adviser, Nominated Adviser and sole bookrunner to the Fundraising

· The Fundraising is conditional, inter alia, on the approval by Shareholders at a general meeting to be held at 10:00 a.m. on 30 June 2015 at the offices of Simmons & Simmons, CityPoint, 1 Ropemaker Street, London EC2Y 9SS (the "General Meeting") and on the Admission of the New Ordinary Shares to trading on AIM becoming effective.

The Circular to Shareholders, including a notice convening the General Meeting, will be dispatched shortly and will also be available on the Company's website at www.rexbionics.com

Crispin Simon, Chief Executive of Rex Bionics, commented: "Back in December, we adopted a new plan with five priorities and it is beginning to bear fruit. We appreciate the support of new and existing investors for our vision - a transformation of the quality of life of wheel chair users.

"These additional funds will allow us to complete our RAPPER II clinical trial and gather further case study evidence on the utility of REX. We will also launch the product in US and other markets."

To see a video of Sophie Morgan discussing the benefits of using her REX P, please click here.

For further information please contact:

Rex Bionics Plc

Crispin Simon, Chief Executive Officer

+44 (0) 781 086 6386

Peter Worrall, Chief Financial Officer

+44 (0)1428 645416

Stifel Nicolaus Europe Limited (NOMAD and Broker)

Jonathan Senior/Giles Balleny

+44 (0) 20 7710 7600

Consilium Strategic Communications

Mary-Jane Elliott / Jessica Hodgson / Chris Welsh / Lindsey Neville

[email protected]

+44 (0) 203 709 5700

About Rex Bionics Plc

Rex Bionics (AIM: RXB) is the AIM-listed pioneer of the REX Robot that enhances the mobility of wheelchair users. Founded in Auckland, New Zealand by two robotics engineers with first-hand experience of wheelchair users and their needs, Rex Bionics is working with physiotherapists to develop the practice of Robot-Assisted Physiotherapy (RAP). In a session of RAP, REX lifts patients from a sitting position into a robot-supported standing position, allowing them to take part in a set of supported walking and stretching exercises, designed by specialist physiotherapists.

Wheelchair users are at risk of developing numerous medical complications from extended periods of sitting. By enabling them to spend more time standing, walking and exercising, REX may offer significant health benefits, including improved sleep, cardiovascular performance, maintenance of joint range, and a reduction in common abdominal problems and prescription drug use. A programme of clinical trials is now under way to evaluate these potential benefits.

REX is used by people with complete spinal cord injury, as well as people who have suffered a stroke or other traumatic brain injury; and people with multiple sclerosis and muscular dystrophy. REX P, for use in the home, enables users to walk and stand with their hands free - providing more work and recreation options.

In May 2014, Rex Bionics joined AIM with a fundraising of £10 million (gross) to scale up production, distribution and marketing internationally, in order to support anticipated demand for both REX products as well as developing the next generation of REX devices, REX 3.

The use of REX in the home is not approved in the United States of America.

For more information please visit, www.rexbionics.com

Additional details of the Fundraising

1. Introduction

The Company is pleased to announce a proposed Placing and Subscription of 3,500,000 New Ordinary Shares with existing and new institutional or other investors at a price of 60 pence per New Ordinary Share to raise £2.1 million (before expenses), conditional upon the passing at the General Meeting of the necessary Resolutions referred to below. In addition, the Company is seeking authority to raise up to a further £1.0 million through the Additional Fundraising from certain identified investors who will be approached before the General Meeting, potentially issuing up to 1,666,667 additional New Ordinary Shares. The New Ordinary Shares will represent between 19.67 and 26.56 per cent. of the Enlarged Share Capital depending on the size of the Additional Fundraising.

The Company intends to use the net proceeds of the Placing, the Subscription and, to the extent such sums are raised, the Additional Fundraising to apply additional financial resources towards the timely achievement of its five commercialisation priorities referred to below and for general working capital purposes. The commercialisation priorities include the funding of clinical trials which the Directors believe will produce data to support future sales growth in the United States and across other regions. In addition, a portion of the net proceeds raised are intended to be allocated to sales and marketing expenditure, product development of the Company's next generation REX device, REX 3, and continued refinement of the manufacturing process.

In addition, in order to implement the Fundraising, a restructuring of the share capital of the Company to reduce the nominal value of each Existing Ordinary Share is necessary. This is because the current share price is below the £1 nominal value of the Existing Ordinary Shares. Under the Act, a company is not permitted to issue new shares at a subscription price which is lower than the nominal value of the shares already in issue. It is therefore proposed to sub-divide each Existing Ordinary Share into one Redenominated Ordinary Share of 10 pence and one Deferred Share of 90 pence.

Approval of the necessary Resolutions for the Share Restructuring and the issue and allotment of the New Ordinary Shares pursuant to the Fundraising will be sought at the General Meeting convened for 10.00 a.m. on 30 June 2015.

2. Progress since admission to AIM

Since the successful completion of the Company's admission to AIM in May 2014, the Company has made material progress in a number of key areas, including the recording of its first completed sale and a further commercial order in May 2015, and the Directors continue to have confidence in the Company's future commercial success.

In addition to these developments, in October 2014 Crispin Simon joined the Company as Chief Executive Officer, with Jeremy Curnock Cook moving to become Non-executive Deputy Chairman. Crispin has an exceptional 25-year track record in industry. Since joining Rex, Crispin has helped focus the Company's strategy and has continued to implement Rex's five commercialisation priorities referred to below.

The Company recognises that the sale of REX on commercial terms and on any scale to healthcare institutions and individuals requires clinical data on the health benefits, as distinct from, albeit very positive, anecdotal wheelchair user feedback.

This recognition led the Directors to outline the five commercialisation priorities, which are listed below:

1. Clinical Data - implementation of clinical trials, the results of which will persuade the rehabilitation community of the clinical benefit and value-for-money offered by REX.

The Company has made good progress with its plan to collect compelling clinical evidence to drive the commercialisation of REX. Preliminary data are now available from RAPPER I, a registry of 11 wheelchair-dependent patients who were studied to assess the feasibility of carrying out sophisticated physiotherapy in the REX, with the trial yielding positive results and no adverse events.

In addition, on 1 June 2015, the Company announced that the first patient, a 37 year old male with a SCI at level T3, had been successfully treated within its RAPPER II trial with positive initial results. Interim data on the first 20 patients is expected within 6 months. The principal focus of RAPPER II's 100 patient clinical trial is to provide robust published evidence that patients with severe spinal cord injuries can be safely and effectively treated and to show that the concept of Robot-Assisted Physiotherapy is viable for the patient and efficient for the physiotherapy clinic.

2. Distributor Recruitment - the recruitment of distribution partners and other commercialisation initiatives.

The Company recently reported that it had signed new agreements covering the distribution of REX in Hong Kong, Denmark, Belgium, the Netherlands and Luxembourg (Benelux), with the commercialisation of REX to begin in these markets by June 2015. In each country where the Company has a distribution partner (and in others where it is aiming to commercialise the product), an early priority is the establishment of a Reference Centre.

While Rex will continue to enter markets wherever well-qualified distribution partners are available, the Company is now prioritising the establishment of strong distribution systems in the United States and in China - the countries that the Directors believe have the greatest long-term potential for REX sales.

3. US Development - implementation of a US clinical trial, to secure FDA 510(k) clearance of REX P for at-home use in the United States.

The Company has accelerated the timing of this programme in view of the quality and size of the opportunity. Rex's US clinical trial programme has attracted the interest of several leading US healthcare institutions and the Company now has a trial design to submit to the FDA. A favourable review could lead to clearance for at-home use in late 2016. The first significant milestone in this programme would be approval by FDA of an Investigational Device Exemption (IDE) for the start of the trial.

4. New Medical Applications - evidence of progress with other projects that demonstrate the value of REX in accelerating the rehabilitation of patients who have experienced other traumatic or degenerative neurological injury.

On 6 May 2015, it was announced that The University Hospitals, Birmingham, NHS Foundation Trust had signed a Memorandum of Understanding to explore the potential use of REX in the Critical Care setting. Critical Care is an entirely new field for Rex as the patients will not typically have a SCI or be using a wheelchair at the time of treatment. The programme will build on Rex's concept of Robot-Assisted Physiotherapy and with a view to confirming the Directors' belief that REX has potential to be used for neurological injuries, thereby increasing Rex's total addressable market. The Company estimates that there are at least 5,000 Critical Care units in hospitals in the United States (and 200 neuro-rehabilitation clinics, where patients requiring spinal cord rehabilitation are typically treated).

5. Reference Centres - the recruitment of further Reference Centres in order to achieve the target of ten Reference Centres by the end of 2015.

The Company has initiated its global Reference Centre programme, with three rehabilitation clinics located in the UK, the United States and New Zealand. The Company has also made well-received presentations at a senior level to the US Army and the US Veterans Affairs organisation.

Manufacturing & Product Development

A key part of offering value-for-money is the ability to manufacture REX products at a lower cost. Since moving in July 2014 to larger premises near Auckland, the Company has realised manufacturing efficiencies and process improvements that have so far resulted in a greater than 25 per cent. reduction in the unit materials cost of a REX.

Work has continued to progress on REX 3, the next generation re-modelled and lower-cost product - earmarked for release in 2017. This research and development work undertaken in the New Zealand subsidiary is being funded in part by a substantial grant received from the New Zealand Government in August 2014 which is potentially worth £0.75 million over the development period.

Pipeline

Rex is now working across three continents with some of the world's leading research institutions in the field of control of a robot with non-manual control systems. In September 2014, Jose Luis Contreras-Vidal, Professor of Electrical, Computer and Biomedical Engineering at the University of Houston, Texas, presented and filmed a working prototype of a mind-controlled REX at a scientific conference in Spain which showed how REX's superior stability and safety makes it an ideal choice for therapies designed for people with the most severe disabilities.

In line with its plan, the Company is working on a number of other enhancements to the current REX product that are intended to enhance its therapeutic effect and to provide access to new categories of users. These include in-built electrical stimulation technology, user performance data analytics and a number of new country registrations.

Strategy

The Company's strategic priority remains targeting the market for wheelchair users with spinal cord injury, by providing products for Robot-Assisted Physiotherapy in rehabilitation clinics and for home use, with the United States in particular, a strategic priority. It does however recognise the opportunities that exist in other areas of healthcare where Rex's concept of Robot-Assisted Physiotherapy can improve outcomes and reduce costs, including Critical Care, stroke and multiple sclerosis.

The application of robotic technology for wheelchair users in the rehabilitation and home care settings is rapidly gaining traction and the Directors continue to believe that it offers a substantial and growing market opportunity. The Directors expect this potential to be demonstrated as clinical trials advance, distribution partners are recruited and other commercialisation priority milestones are reached.

In line with the strategy outlined at the time of the Company's admission to AIM in May 2014, the Directors expect that these important differentiating factors for REX will enable it over time to establish a significant market position.

3. Reasons for the Fundraising and use of proceeds

The Company intends to use the net proceeds of the Fundraising to apply additional financial resources towards the timely achievement of its five commercialisation priorities, and for general working capital purposes. The commercialisation priorities include the funding of clinical trials which the Directors believe will produce data to support future sales growth in both the United States and across other regions. With cash balances of £4.37 million as at 31 March 2015, the Directors expect that the amount raised by the Fundraising will allow the Company to complete the RAPPER II trial; initiate a US clinical trial; appoint distribution partners in the United States, China and other markets - and thus over the next 12 months provide a more complete body of clinical and commercial evidence of REX's significant value creation potential.

A portion of the net proceeds raised in the Placing and Subscription, and any amounts from the Additional Fundraising, is intended to be used to fund sales and marketing expenditure, product development of the Company's next generation REX device, REX 3, establishment of a stock of finished goods for sale, demonstration and clinical trial and further enhancement of the manufacturing process. It should be noted that while the Company intends to raise further new funds through the Additional Fundraising, there can be no certainty that such amounts will be available.

4. Current trading and outlook

The Company released its full year financial results for the 16 month period ended 31 March 2015 on 29 May 2015, the full text of which can be located on the Company's website, www.rexbionics.com. The key results were:

· net loss 16 months ended 31 March 2015 £5.30 million (12 months ended 30 November 2013: net loss £0.48 million); and

· cash at 31 March 2015 £4.37 million (30 November 2013: £0.17 million).

The Board believes that REX is a unique technology with the potential to improve radically the lives of wheelchair users. During 2014 the Company put in place the fundamentals to bring REX to a global customer base through an initial public offering, the scale-up of its manufacturing facility and the build-out of a sales and marketing infrastructure.

User feedback on REX remains overwhelmingly positive and the Company has a clear commercialisation strategy against which it is making good progress.

While it may be necessary for the Company to obtain further rounds of equity financing, as is conventional in the commercialisation of medical technology companies such as Rex, it is expected that the Fundraising will allow for the progress of the Company's objectives. By successfully progressing these objectives, it is hoped that the Company would be able to raise such further rounds of equity financing to grow and develop further from a position of strength and enhanced value. 

5. Further details on the Fundraising

The Company is proposing to raise up to £2.1 million (before expenses) by way of a Placing of 1,016,670 Placing Shares at a price of 60 pence per New Ordinary Share and a Subscription for 2,483,330 Subscription Shares at a price of 60 pence per New Ordinary Share. Together, the Placing Shares and Subscription Shares will represent approximately 19.67 per cent. of the Enlarged Share Capital, not including any amounts which may be raised under the Additional Fundraising.

The Issue Price represents a premium to the closing mid-market price of 6.19 per cent. per Ordinary Share as at 11 June 2015, the latest practicable date before the announcement of the Fundraising. In connection with the Placing, the Company has entered into the Placing Agreement pursuant to which Stifel has agreed, in accordance with its terms, to use reasonable endeavours to place the Placing Shares with institutional and other investors, including certain existing Shareholders. As part of the Subscription, the Subscribers have entered into Subscription Agreements with the Company to subscribe for, in total, 2,483,330 New Ordinary Shares. Neither the Placing nor the Subscription is underwritten and Stifel is not acting for the Company, or any other person, in connection with the Subscription.

In addition to the Placing and Subscription, the Company is targeting a maximum further raise of £1.0 million (before expenses) by way of an Additional Fundraising of up to 1,666,667 New Ordinary Shares at the Issue Price. The Additional Fundraising would be by way of a private placing or subscription at the Directors' discretion, and is not open to the public. The Additional Fundraising will be available only to new and existing institutional or other investors which the Directors are satisfied can lawfully invest on a private placement basis until 10.00 a.m. on 29 June 2015 (or such later time and/or date as the Company and Stifel may agree).

The Additional Fundraising is not underwritten and Stifel is not acting for the Company, or any other person, in connection with any Additional Fundraising by way of subscription.

The New Ordinary Shares to be allotted and issued pursuant to the Fundraising will be allotted and issued fully paid and will, on issue, rank pari passu with the Redenominated Ordinary Shares in issue immediately following the Share Restructuring, including the right to receive, in full, all dividends and other distributions thereafter declared, made or paid after the date of issue together with all rights attaching to them and free from all liens, charges and encumbrances of any kind.

The Placing Agreement

The Company has entered into a Placing Agreement with Stifel dated 12 June 2015 under which Stifel has agreed, as agent of the Company, to use its reasonable endeavours to procure subscribers for the Placing Shares at the Issue Price. The conditions in the Placing Agreement require, amongst other things, that Stifel receive certain placing commitments and successful completion of application for Admission.

The Placing Agreement contains customary warranties given by the Company to Stifel about matters relating to the Group and its business and a customary indemnity given by the Company in respect of liabilities arising out of or in connection with the Fundraising. Stifel can terminate the Placing Agreement in certain circumstances before Admission, including circumstances where any of the warranties are found not to be true or accurate or were misleading or the occurrence of certain force majeure events.

Debra Leeves, a member of senior management, has agreed to subscribe for £15,000 of New Ordinary Shares at the Issue Price, being 25,000 New Ordinary Shares. In addition, certain Directors have irrevocably undertaken to subscribe for, in total, £65,000 of New Ordinary Shares at the Issue Price, being 108,331 New Ordinary Shares as follows:

Conditions, Admission & Registration

The Fundraising is conditional, among other matters, on:

· the passing (without amendment) of the Resolutions (further details of which are set out below) and them becoming unconditional;

· the conditions in the Placing Agreement and Subscription Agreements being satisfied or (if applicable) waived and the Placing Agreement not having been terminated in accordance with its terms before Admission; and

· Admission becoming effective by no later than 8.00 a.m. on 01 July 2015 (or such later time and/or date, being no later than 8.00 a.m. on 20 July 2015 as the Company and Stifel may agree).

The Placing Agreement is conditional, amongst other matters, on Admission taking place no later than 1 July 2015 (or such later date as Stifel and the Company may agree, but in any event no later than 20 July 2015. Application will be made to the London Stock Exchange for the New Ordinary Shares to be admitted to trading on AIM. On the assumption that, among other matters, the Resolutions are passed and the Placing Agreement becomes unconditional, it is expected that Admission will become effective and that dealings in the New Ordinary Shares will commence on 1 July 2015.

It is expected that, subject to the Placing Agreement and the Subscription Agreements becoming unconditional in all respects, including those entered into under the Additional Fundraising, the New Ordinary Shares to be issued will be registered in the names of the Placees and/or Subscribers, respectively, and issued either: (a) in certificated form, with the relevant share certificate expected to be despatched by post, at the applicant's risk no later than 8 July 2015; or (b) in CREST where an applicant who is a 'system member'' (as defined in the CREST Regulations) in relation to CREST has so elected in which case delivery (to the designated CREST account) of the New Ordinary Shares is expected to take place on 1 July 2015, unless the Company exercises its right to issue such New Ordinary Shares in certificated form.

No temporary documents of title will be issued. Pending the despatch of definitive share certificates, instruments of transfer will be certified against the register of members of the Company.

Subscription by Substantial Shareholders

In addition to the proposed subscription for Subscription Shares at the Issue Price by Haiyin Equity Investment Fund L.P., existing Shareholders being One Funds Management Limited, as trustee for the Asia Pacific Healthcare Fund II ("Asia Pacific") (who currently hold 1,657,743 Ordinary Shares representing 11.6 per cent. of the Company's Existing Ordinary Shares) and Paul Matthews (who currently holds 1,772,504 Ordinary Shares representing 12.4 per cent. of the Company's Existing Ordinary Shares) have agreed to subscribe pursuant to the Subscription for 833,333 and 433,333 New Ordinary Shares at the Issue Price respectively. Hunter Hall Investment Management Limited ("Hunter Hall") (who currently hold 1,833,333 Ordinary Shares representing 12.8 per cent. of the Company's Existing Ordinary Shares) have agreed to subscribe pursuant to the Placing for 833,337 New Ordinary Shares at the Issue Price.

6. Details of the Share Restructuring

The proposed restructuring of share capital of the Company has become necessary as a result of the share value as traded on AIM falling below the nominal value of the Existing Ordinary Shares. Under the Act, a company is not permitted to issue new shares at a subscription price less than the nominal value of the shares in question and accordingly it is not practical for the Company to raise additional capital through the issue of new equity shares when the minimum subscription price would have to be £1.00 per Ordinary Share and the current price as 11 June 2015 was 58.5 pence per Ordinary Share.

It is therefore proposed to sub-divide and re-designate each Existing Ordinary Share into one Redenominated Ordinary Share of 10 pence and one Deferred Share of 90 pence. The Redenominated Ordinary Shares will retain all the rights currently attaching to the Existing Ordinary Shares in respect of dividends and voting and will rank ahead of the Deferred Shares on a winding up such that the Deferred Shares will only rank for repayment of their nominal value once all sums paid up on the Redenominated Ordinary Shares have been paid and £100,000 has been paid in respect of each Redenominated Ordinary Share. Other than the change in nominal value therefore, the Redenominated Ordinary Shares will be identical to the Existing Ordinary Shares. No new certificates will be issued in respect of the Redenominated Ordinary Sharesarising as a result of the Share Restructuring and the existing share certificates in respect of Existing Ordinary Shares will be valid and will continue to be accepted as evidence of title for the Redenominated Ordinary Shares.

The Deferred Shares will have no voting rights, no rights to dividends and negligible rights on a return of capital. The Deferred Shares will not be listed on any stock exchange and will not be freely transferable. No share certificates will be issued for any of the Deferred Shares. The Company will have the right at any time to purchase all the Deferred Shares for an aggregate consideration of £1. There are no immediate plans to purchase or to cancel the Deferred Shares, although the Directors propose to keep the situation under review.

Following the Share Restructuring, and pursuant to the terms of the Warrant Instruments, on exercise of the Warrants, holders will be issued with Redenominated Ordinary Shares at an unchanged exercise price of 180 pence per Redenominated Ordinary Share.

TheShare Restructuring will require the approval of Shareholders at the General Meeting.

7. General Meeting

A General Meeting of the Company is being convened for 10.00 a.m. on 30 June 2015 at which the Resolutions as summarised below will be submitted to shareholders for approval, of which resolutions 1 and 3 will be proposed as Ordinary Resolutions and resolutions 2 and 4 will be proposed as Special Resolutions.

Resolution 1: THAT, subject to and conditional on the passing of Resolution 2, each of the existing issued Ordinary Shares of £1 each in the share capital of the Company is sub-divided and re-designated into one new Ordinary Share of 10 pence and one new Deferred Share of 90 pence in the share capital of the Company.

Resolution 2: THAT the Articles of Association be amended by the addition of a new definition to Article 2.1 and a new Article 5.2 setting out the rights of the Deferred Shares following the passing of Resolution 1, as well as an amendment to Article 2.2.

Resolution 3: THAT subject to and conditional on the passing of Resolution 1, the Board is generally and unconditionally authorised in accordance with section 551 of the Act to allot relevant securities (within the meaning of section 551(1) of the Act) providing such authority is limited to:

(a) an aggregate nominal value amount of £350,000 pursuant to the Subscription and Placing for New Ordinary Shares in the Company;

(b) an aggregate nominal value amount of up to £166,667 in relation to the Additional Fundraising; and

such authority to expire on 30 September 2015 or if earlier at the next Annual General Meeting of the Company.

Resolution 4: THAT, subject to and conditional on the passing of Resolution 3, the Board are empowered, pursuant to section 570 of the Act, to allot equity securities (within the meaning of section 560(1) of the Act) for cash pursuant to the authority conferred by Resolution 3 as if section 561(1) of the Act did not apply to any such allotment, provided that such power is limited to:

and expires on 30 September 2015 or if earlier at the next Annual General Meeting of the Company.

In this resolution, "right issue" means an offer of equity securities open for acceptance for a period fixed by the Board to holders on the register on a fixed record date in proportion nearly as may be to their respective holdings, but subject to such exclusions or other arrangements as the Board may deem necessary or expedient to deal with any fractional entitlements or legal or practical difficulties under the laws, or the requirements of any recognised regulatory body or any stock exchange, in any territory.

8. Share Option Plan

The Remuneration Committee has recommended to the Board that, conditionally upon the Share Restructuring (i) the cancellation of all subsisting Options over Ordinary Shares granted to executive directors and employees of the Company under the Share Option Plan and (ii) the grant of new options under the Share Option Plan with an exercise price equal to the Issue Price (the "New Options"). The New Options will vest in three equal tranches over the three year period from the date of grant, conditional on the sustained share price performance of the Ordinary Shares on the relevant vesting dates (averaged over a period of ten business days), as outlined below:

As a result of the Restructuring, the Share Option Plan will be amended to reflect the new nominal value per Ordinary Share.

Options over Ordinary Shares granted to non-executive directors under the Share Option Plan will continue to subsist on the existing terms with an exercise price of 180p.

9. Related Party Transactions

As Asia Pacific, Paul Matthews and Hunter Hall are each substantial Shareholders of the Company, their subscriptions each constitute related party transactions under the AIM Rules. The Directors consider, having consulted the Company's nominated adviser, Stifel, that the terms on which Asia Pacific and Paul Matthews are each subscribing for Subscription Shares and Hunter Hall are subscribing for Placing Shares are fair and reasonable insofar as the Company's Shareholders are concerned.

As David Macfarlane, Jeremy Curnock Cook, Crispin Simon, John Plimmer, and Victoria Provis are directors of the Company, the subscription by each of them constitutes a related party transaction under the AIM Rules. The Independent Directors consider, having consulted the Company's nominated adviser, Stifel, that the terms on which these directors are subscribing for Subscription Shares are fair and reasonable insofar as the Shareholders are concerned.

10. Irrevocable undertakings

The Board has irrevocably undertaken to vote in favour of the Resolutions in respect of its own shareholdings amounting in aggregate to 904,864 Existing Ordinary Shares, representing 6.3 per cent. of the Existing Ordinary Shares currently in issue.

In addition to the Directors, certain other Shareholders have irrevocably undertaken to vote in favour of the Resolutions in respect of the Ordinary Shares in which they are interested, amounting in aggregate to 1,657,743 Ordinary Shares, representing approximately 11.6 per cent. of the Existing Ordinary Shares.

DEFINITIONS