THIS DOCUMENT IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION. If you are in any doubt about the contents ofthis Document, or as to the action you should take, you should immediately consult a person authorised under the FinancialServices and Markets Act 2000 (as amended) (“FSMA”) who specialises in advising on the acquisition of shares and othersecurities in the United Kingdom. The whole of the text of this Document should be read. You should be aware that an investmentin the Company involves a high degree of risk and prospective investors should carefully consider the section entitled “RiskFactors” in Part II of this Document before taking any action.

This Document comprises an AIM admission document, which has been drawn up in accordance with the AIM Rules for Companies (“AIMRules”) and has been prepared in connection with, amongst other matters, the Placing and the admission of the Enlarged Share Capital totrading on AIM. This Document does not constitute an offer to the public within the meaning of sections 85 and 102B of the FSMA or otherwise.This Document is not an approved prospectus for the purposes of the Prospectus Rules and a copy of it has not been, and will not be, reviewedor approved by the FCA, the UKLA or the London Stock Exchange.

The Company and the Directors, whose names appear on page 5 of this Document, accept individual and collective responsibility for theinformation contained in this Document, including individual and collective responsibility for compliance with the AIM Rules. To the best of theknowledge of the Company and the Directors, who have taken all reasonable care to ensure that such is the case, the information containedin this Document is in accordance with the facts and does not omit anything likely to affect the import of such information. In connection withthis Document, no person is authorised to give any information or make any representation other than as contained in this Document and, ifgiven or made, any such information or representation must not be relied upon as having been so authorised.

Application has been made for the Enlarged Share Capital to be admitted to trading on AIM. It is expected that Admission will become effectiveand that trading in the Enlarged Share Capital will commence on AIM on 4 June 2015.

AIM is a market designed primarily for emerging or smaller companies to which a higher investment risk tends to be attachedthan to larger or more established companies. AIM securities are not admitted to the Official List of the UKLA. A prospectiveinvestor should be aware of the risks of investing in such companies and should make the decision to invest only after carefulconsideration and, if appropriate, consultation with an independent financial adviser. Each AIM company is required pursuant tothe AIM Rules to have a nominated adviser. The nominated adviser is required to make a declaration to the London StockExchange in connection with the application for Admission in the form set out in Schedule Two to the AIM Rules for NominatedAdvisers. Neither the UKLA nor the London Stock Exchange has examined or approved the contents of this Document. The AIMRules are less demanding than those of the Official List of the UKLA. It is emphasised that no application has been made, or isbeing made, for admission of the Enlarged Share Capital to the Official List of the UKLA or to trading on the London StockExchange’s market for listed securities or to any other stock exchange or trading facility.

Fishing Republic plc(Incorporated and registered in England and Wales with registered number 9196822)

Placing of 10,000,000 new Shares at 15p per share andAdmission of the Enlarged Share Capital to trading on AIM

Nominated Adviser and Broker

Share capital immediately following AdmissionIssued and fully paid Shares

Nominal amount: £237,500 Number: 23,750,000

The Placing is conditional on Admission taking place by 8.00 a.m. on 4 June 2015 (or such a later time and/or date as the Company andNorthland may agree, being not later than 3 July 2015). The Placing Shares will, on issue, rank pari passu in all respects with the then existingShares, including the right to receive all dividends or other distributions declared, made or paid after the issue of the Shares.

Northland Capital Partners Limited (“Northland”) is authorised and regulated in the United Kingdom by the FCA and is acting asNominated Adviser and Broker to the Company. Northland is acting on behalf of the Company and no one else in connectionwith the Placing and Admission and will not be responsible to any person other than the Company for providing the regulatoryand legal protections afforded to customers (as defined by the FCA rules) of Northland nor for providing advice in relation to thecontents of this Document or any matter, transaction or arrangement referred to in this Document. The responsibilities ofNorthland as Nominated Adviser under the AIM Rules for Nominated Advisers are owed solely to the London Stock Exchangeand are not owed to the Company or to any Director or to any other person in respect of their decision to acquire Shares inreliance on any part of this Document. No liability whatsoever is accepted by Northland for the accuracy of any information oropinions contained in this Document or for the omission of any information from this Document, for which the Company and theDirectors are solely responsible.

This Document does not constitute an offer to sell or subscribe for, or the solicitation of an offer to buy or subscribe for, Shares in any jurisdictionin which such an offer or solicitation is unlawful and is not for distribution within or into Australia, Canada, Japan, the Republic of Ireland, theRepublic of South Africa or the United States or to any resident, national or citizen of such countries. The Shares have not been, and will not be,registered under the applicable securities laws of Australia, Canada, Japan, the Republic of Ireland, the Republic of South Africa or the UnitedStates. The distribution of this Document in other jurisdictions may be restricted by law and therefore persons into whose possession thisDocument comes should inform themselves about and observe such restrictions. Any failure to comply with these restrictions may constitute aviolation of the securities laws of any jurisdiction.

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Sch 2 (e)

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Sch 2 (e))

CONTENTS

Page

EXPECTED TIMETABLE OF PRINCIPAL EVENTS AND ADMISSION STATISTICS 3

DIRECTORS, SECRETARY AND ADVISERS 5

DEFINITIONS 6

PART I INFORMATION ON THE GROUP 9

Introduction 9

Background and History 9

Business Overview 10

Market and Competition 13

Strategy 15

Group Structure and Summary Financial Information 16

Current Trading and Prospects 16

The Placing 16

Directors 17

Reasons for Admission and Use of Proceeds 17

Relationship Agreement 18

EIS and VCT Status 18

Admission, Dealings and CREST 19

Lock-ins and Orderly Market Undertakings 19

Corporate Governance 20

The Takeover Code 20

Dividend Policy 21

Taxation 21

Share Option Plans 21

Additional Information 21

PART II RISK FACTORS 22

PART III (A) ACCOUNTANTS’ REPORT ON THE FINANCIAL INFORMATION 29OF LUREFLASH INTERNATIONAL LIMITED

(B) ACCOUNTANTS’ REPORT ON THE COMPANY 51

(C) UNAUDITED PRO FORMA STATEMENT OF AGGREGATED NET ASSETS 57

PART IV ADDITIONAL INFORMATION 60

2

EXPECTED TIMETABLE OF PRINCIPAL EVENTS

Publication of this Document 29 May 2015

Admission of Enlarged Share Capital to trading on AIM 8.00 a.m. on 4 June 2015

CREST accounts to be credited with Placing Shares 4 June 2015

Share certificates in respect of Placing Shares despatched by 11 June 2015

All times are London, UK times. Each of the times and dates in the above timetable is indicative only and is subject to change withoutfurther notice.

ADMISSION STATISTICS

Placing Price per Placing Share 15p

Number of Existing Shares in issue immediately prior to Admission 13,750,000

Number of Placing Shares to be issued pursuant to the Placing 10,000,000

Number of Shares in issue immediately following Admission 23,750,000

Placing Shares as a percentage of the Enlarged Share Capital 42 per cent.

Number of Shares under option on the day immediately following Admission(1) 1,617,500

Gross proceeds of the Placing £1,500,000

Net proceeds of the Placing(2) £1,050,000

Market capitalisation of the Company at Admission at the Placing Price £3,562,500

AIM Ticker FISH

SEDOL BY7RY76

ISIN GB00BY7RY763

Notes:

(1) The number of options over Shares set out above assumes that the options are granted based on the Placing Price. However,the number of options over Shares that will be granted on the day of Admission will be determined by reference by the closingmid-market price of a Share at the close of trading on that date. Accordingly, depending on whether the closing mid-market priceof a Share on that date is higher or lower than the Placing Price, the number of options over Shares actually granted may behigher or lower than the number set out above.

(2) The estimated net proceeds receivable by the Company and stated after deduction of the estimated commission, fees and otherexpenses of the Placing and Admission (excluding VAT) payable by the Company, which are currently expected to be approximately£450,000.

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3

FORWARD-LOOKING STATEMENTS

This Document includes ‘forward-looking statements’ which includes all statements other than statementsof historical facts, including, without limitation, those regarding the Group’s financial position, businessstrategy, plans and objectives of management for future operations and any statements preceded by,followed by or that include forward-looking terminology such as the words ‘targets’, ‘believes’, ‘estimates’,‘expects’, ‘aims’, ‘intends’, ‘can’, ‘may’, ‘anticipates’, ‘would’, ‘should’, ‘could’, or similar expressions orthe negative of them. Such forward-looking statements involve known and unknown risks, uncertainties andother important factors beyond the Group’s control that would or might cause the actual results, performanceor achievements of the Group to be materially different from future results, performance or achievementsexpressed or implied by such forward-looking statements. Such forward-looking statements are based onnumerous assumptions regarding the Group’s present and future business strategies and the environmentin which the Group will operate in the future. Among the important factors that could cause the Group’sactual results, performance or achievements to differ materially from those in forward-looking statementsare those factors in Part II of this Document. Any forward-looking statements speak only as at the date ofthis Document. The Company and the Directors expressly disclaim any obligation or undertaking todisseminate any updates or revisions to any forward-looking statements contained in this Document toreflect any change in the Company’s and/or the Directors’ expectations with regard to them or any changein events, conditions or circumstances on which any such statements are based. As a result of these factors,the events described in the forward-looking statements in this Document may not occur either partially orat all.

Neither the Company, Northland, nor any of their respective associates, directors, officers, employees oradvisers, provides or makes any representation, assurance or guarantee that the occurrence of the eventsexpressed or implied by any forward-looking statements contained in this Document will actually occur.Other than in accordance with their legal or regulatory obligations (including under the AIM Rules), none ofthe Company, the Directors or Northland is under any obligation, and each of them expressly disclaims anyintention or obligation, to update or revise any forward-looking statements, whether as a result of newinformation, future events or otherwise.

PRESENTATION OF MARKET AND FINANCIAL INFORMATION

The data, statistics and information and other statements in this document regarding the markets in whichthe Group operates, or the Group’s position in such markets, are based on the Group’s records or are takenor derived from statistical data and information derived from the sources described in this document.

In relation to these sources, such information has been accurately reproduced from the published informationand, so far as the Directors are aware and are able to ascertain from the information provided by the suppliersof these sources, no facts have been omitted which would render such information inaccurate or misleading.

Various figures and percentages in this document have been rounded and accordingly may not add up to100 per cent. Certain financial data has also been rounded. As a result of this rounding, the totals of datapresented in this Document may vary slightly from the actual arithmetical totals of such data.

The contents of the Group’s websites, any website mentioned in this Document or any website directly orindirectly linked to those websites have not been verified and do not form part of this Document, andinvestors should not rely on such information.

4

DIRECTORS, SECRETARY AND ADVISERS

Directors James Henry Newman (Independent Non-Executive Chairman)Stephen John Gross (Chief Executive Officer)Robert Tippett (Finance Director)Paul Hagerty (IT Director)Zoe Gross (Operations Director)Edward Peter McDermott (Independent Non-Executive Director)

Company Secretary Robert Tippett

Registered Office Vulcan WorksChesterton RoadEastwood Trading EstateEastwoodRotherham S65 1SU

Telephone Number 01709 724 700

Nominated Adviser and Broker Northland Capital Partners Limited131 Finsbury PavementLondon EC2A 1NT

Solicitors to the Company Walker Morris LLPKings Court12 King StreetLeeds LS1 2HL

Reporting Accountants and Crowe Clark Whitehill LLP (Member firm of the InstituteAuditors St Bride’s House of Chartered Accountants

10 Salisbury Square in England and Wales)London EC4Y 8EH

Solicitors to the Nominated Marriott Harrison LLPAdviser and Broker 11 Staple Inn

London WC1V 7QH

Financial Public Relations KTZ Communications LimitedNo. 1 CornhillLondon EC3V 3ND

Registrars Share Registrars LimitedSuite EFirst Floor9 Lion & Lamb YardFarnhamSurrey GU9 7LL

Main website www.fishingrepublic.net

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DEFINITIONS

In this Document, unless the context requires otherwise, the words and expressions set out below shallbear the following meanings.

“£”, “p”, “pence” or “pound” the lawful currency of the United Kingdom;

“Act” the Companies Act 2006, as amended;

“Admission” the admission of the Enlarged Share Capital to trading on AIMbecoming effective in accordance with the AIM Rules;

“AIM” the market of that name operated by the London Stock Exchange;

“AIM Rules” the AIM Rules for Companies published by the London StockExchange, as amended, which set out the rules, responsibilities andguidance notes in relation to companies whose shares are admittedto trading on AIM;

“AIM Rules for Nominated the AIM Rules for Nominated Advisers published by the LondonAdvisers” Stock Exchange, as amended;

“Articles” the articles of association of the Company adopted conditional uponAdmission, a summary of which is set out in paragraph 3 of Part IVof this Document;

“Board” or “Directors” the directors of the Company (each a “Director”) as listed on page4 of this Document;

“Business Day” a day other than a Saturday or Sunday on which clearing banks aregenerally open for commercial business in the City of London;

“certificated” or a share or security which is not in uncertificated form (that is, not in“in certificated form” CREST);

“Close Period” has the meaning as set out in the AIM Rules;

“Company” or “Fishing Republic” Fishing Republic plc, a company incorporated in England and Waleswith registered number 9196822;

“CREST” the electronic system for the holding and transferring of shares andother securities in paperless form of which Euroclear UK & IrelandLimited is the operator (as defined in the CREST Regulations);

“CREST Regulations” the Uncertificated Securities Regulations 2001, as amended;

“Document” this admission document;

“DTRs” the disclosure rules and transparency rules of the FCA made for thepurposes of Part VI of the FSMA in relation to the disclosure ofinformation by an issuer;

“Enlarged Share Capital” the issued Shares immediately following Admission (including thePlacing Shares);

“Executive Directors” the executive directors of the Company at the relevant time;

“Existing Shares” or the 13.750,000 ordinary shares of £0.01 each in issue at the date“Existing Share Capital” of this Document;

6

“FCA” the UK Financial Conduct Authority or any successor body;

“FSMA” the Financial Services and Markets Act 2000, as amended;

“Group” the Company and/or its Subsidiaries for the time being;

“Group Company” a company within the Group;

“HMRC” Her Majesty’s Revenue and Customs;

“Independent Non-Executive the ‘independent non-executive directors’ of the Company, within Directors” the meaning of the UK Corporate Governance Code, as at the date

of this Document being James Newman and Edward McDermott;

“IFRS” International Financial Reporting Standards, as adopted for use inthe European Union;

“IP” intellectual property;

“Lock-in Agreements” the agreements by which certain persons have agreed withNorthland and the Company certain undertakings with respect totheir holdings of Shares following Admission, as more particularlydescribed in paragraph 10.5 of Part IV of this Document;

“London Stock Exchange” London Stock Exchange plc;

“Lureflash” Lureflash International Limited, the Company’s wholly ownedSubsidiary pursuant to the Share Exchange Agreement;

“Nomad” or “Northland” Northland Capital Partners Limited, the Company’s NominatedAdviser and Broker on Admission;

“Non-Executive Directors” the non-executive directors of the Company at the relevant time;

“Northland Option Agreement” the option agreement dated 29 May 2015 between (1) the Companyand (2) Northland under which the Northland Options are granted;

“Northland Options” the options over Shares representing 1 per cent. of the EnlargedShare Capital granted to Northland under the Northland OptionAgreement;

“Placees” the subscribers for Placing Shares pursuant to the Placing;

“Placing” the conditional placing by Northland of the Placing Shares at thePlacing Price pursuant to the terms of the Placing Agreement;

“Placing Agreement” the conditional placing agreement dated 29 May 2015 between theCompany, the Directors and Northland in relation to the Placingarrangements and Admission, details of which are set out inparagraph 10.1 of Part IV of this Document;

“Placing Price” 15p per Placing Share;

“Placing Shares” the 10,000,000 new Shares to be issued pursuant to the Placing;

“Principal Shareholder” Stephen John Gross;

“Prospectus Directive” EU Prospectus Directive (2003/71/EC), as amended and asimplemented in a relevant member state of the European EconomicArea;

7

“Prospectus Rules” the prospectus rules published by the FCA from time to time for thepurposes of Part VI of the FSMA in relation to offers of securities tothe public and admission of securities to trading on a regulatedexchange;

“QCA Code” the QCA’s Corporate Governance Guidelines for Small and Mid-sizedCompanies, as amended;

“Registrar” Share Registrars Limited;

“Relationship Agreement” the conditional relationship agreement dated 29 May 2015 between(1) the Principal Shareholder, (2) Zoe Gross, (3) the Company and(4) Northland, a summary of which is set out in paragraph 10.7 ofPart IV of this Document;

“Share Exchange Agreement” the agreement dated 29 May 2015 between (1) the Company, (2)the Principal Shareholder, (3) John Henry Gross, (4) Zoe Gross,(5) Paul Turner, (6) Robert Tippett and (7) Russell Holmes, a summaryof which is set out in paragraph 10.6 of Part IV of this Document;

“Share Option Plans” the share option plans to be adopted by the Company on or prior toAdmission, details of which are set out in Part I and paragraph 4 ofPart IV of this Document;

“Shareholders” holders of Existing Shares or the New Shares, as the case may be;

“Shares” ordinary shares of one penny each in the capital of the Company;

“Subsidiary” a subsidiary undertaking (as defined by section 1159 of the Act) ofthe Company and “Subsidiaries” shall be construed accordingly;

“Takeover Code” the City Code on Takeovers and Mergers published by the TakeoverPanel, as amended;

“Takeover Panel” the Panel on Takeovers and Mergers;

“TCGA” the Taxation of Chargeable Gains Act 1992;

“UK” or “United Kingdom” the United Kingdom of Great Britain and Northern Ireland;

“UK Corporate Governance Code” the UK Corporate Governance Code published in September 2014by the Financial Reporting Council, as amended;

“UKLA” United Kingdom Listing Authority, being the FCA acting in itscapacity as the competent authority for the purposes of the FSMA;

“uncertificated” or in relation to a share or other security, a share or other security title “in uncertificated form” to which is recorded on the relevant register of the share or security

concerned as being held in uncertificated form in CREST and titleto which, by virtue of the CREST Regulations, may be transferred inCREST; and

“VAT” value added tax.

8

PART I

INFORMATION ON THE GROUP

Introduction

Fishing is one of the UK’s largest participation sports, attracting approximately four million participants overthe two years to 2012 and generating approximately £3.5 billion per year on average in direct and indirectsales. There are a number of bodies promoting the sport and, in 2012, Defra and the Environment Agencycommissioned the Angling Trust, the representative body for anglers in England, to compile a nationalstrategy for the future of angling participation, resulting in the publication of ‘Fishing for Life’, which sets outa five year plan to promote fishing in the UK.

In a highly fragmented market, Fishing Republic is one of the largest retailers of fishing tackle in the UK byfloorspace. The Group’s origins date back to 1985 when its Founder and Chief Executive, Steve Gross,aged 13 years, established a business selling fishing flies and fly tying materials to fishing tackle wholesalers.Operating from physical stores and online, the Group today caters for all types of anglers (coarse, carp,game and sea fishing), supplying a comprehensive range of product, including leading brands.

The Group currently operates a chain of seven retail outlets in the North of England, with a combined footprintof approximately 61,500 ft2 of retail and warehousing space. Stores are typically located in out-of-town lightindustrial sites with car parking facilities, and sales staff are able to provide advice on products and sharean interest in fishing. The Directors believe that the wide range of products and knowledgeable staff serveto make the outlets ‘destination’ stores, which draw customers from a wide area.

Fishing Republic generates approximately 49 per cent. of its sales online via third party online retailers andits own websites. The Group has also developed a range of own brand products, including Klobba forclothing and Theseus for fishing tackle. In addition, the Group has established third party, cost effectivemanufacturing in the Far East for own brand products.

The fishing tackle retail sector is highly fragmented, predominantly comprising a large number of independentretailers including a few established small chains. The Directors believe that there is an opportunity to act asa consolidator in the sector and build a significant market presence through acquisition and organic growth.The Directors believe that Fishing Republic is the only participant in the market looking to act as aconsolidator, giving the Group the benefit of first-mover advantage.

As part of its organic growth strategy, the Company has identified a new site for a Fishing Republic store onthe outskirts of Birmingham close to the M6 motorway. The site is a former industrial unit of approximately9,400 ft2 and has ample car parking, therefore fitting the Group’s ideal store criteria. Birmingham has beentargeted by the Group as it has one of the largest angling clubs in the UK and is primarily served by a numberof smaller fishing tackle retailers.

The Directors believe that Fishing Republic’s key strengths are:

● highly experienced management team with wide knowledge of both the retail and wholesale fishingtackle marketplace, including potential acquisition opportunities;

● existing significant market presence in highly fragmented sector;

● proven model of ‘destination’ stores with wide product range and knowledgeable staff, combined withonline sales;

● ability to source a wide range of high margin own brand products, notably clothing and luggage, fromsuppliers in the Far East; and

● well-established systems including supply chain and IT platform, creating efficiencies and underpinningscalable business model.

Background and History

The Group’s business was established in 1985 in Rotherham as ‘Stephen Gross Flies’, when Steve Grosswas 13 years old, specialising in the tying of flies and making fly tying materials for fishing tackle wholesalers.In its first three years of trading the business generated over £100,000 of revenue (in aggregate). In 1988

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the business moved into rented premises in Mexborough, Rotherham and in 1991 the business wasincorporated as Lureflash Products Limited. It was renamed as Lureflash International Limited in 1997 andin the same year started to source its own branded products from the Far East.

In 1999 Lureflash opened its first retail outlet and mail order operation, ‘Yorkshire Game Angling’, inThrybergh, Rotherham. Following the success of this initial venture, Lureflash launched its ‘Fishing Republic’brand with the opening of a store in Barnsley in 2005, aimed at the retail market and with an expandedproduct range for all angling disciplines. In the same year, the Group moved into a large warehouse inRotherham to serve its retail stores, mail order and wholesale customers. The Group then expanded rapidly,opening ‘Fishing Republic’ stores in Manchester and Hull in 2006, Sunderland, Scunthorpe and Sheffield in2007 and Doncaster in 2008. In 2010, the Group decided to close the Scunthorpe store, which had beenunderperforming, and also sold the Hull store to its management. More recently in 2011, the Companymoved its Yorkshire Game Angling store to the Rotherham warehouse site and in 2013 it opened a ‘FishingRepublic’ retail store on the same site, which also incorporates the head office. In 2014, the Group boughtback the Hull business, in order to bring all stores carrying the ‘Fishing Republic’ brand under commonownership.

Business OverviewStores and locations

The Group has seven retail stores located across the North of England, which it leases from Steve and ZoeGross, typically positioned in out-of-town light industrial locations. The Group has avoided prime high-streetlocations and shopping centres where space tends to be priced at a premium, instead opting to create‘destination’ stores which provide adequate space to display properly the growing range of tackle andmodern fishing equipment that the Group offers and have customer car parking facilities.

The Directors believe that, notwithstanding the growth of online retail in recent years, the presence of physicalretail stores will continue to play an important role in the expansion of the Group. In particular, as manysuppliers of fishing tackle equipment typically only deal with retailers with a physical store presence, theGroup’s network of stores enables it to offer a wider range of products in store and online than would bepossible as an internet only retailer. In addition, physical stores provide customers with easy and immediateaccess to consumables (including flies, bait, hooks and line) as well as other lower priced items, withconsumables typically generating repeat visits and recurring sales. The average spend in the Group’s retailstores per visit is currently £22.23.

Rotherham

This site is on the Eastwood Trading Estate, a short drive from the centre of Rotherham, and was firstoccupied by the Group in 2005. This site accommodates the Company’s main warehouse and distributionfacilities, together with the Group’s head office and the stock control systems. In 2013, Lureflash opened aretail store at the location, which now stocks the Group’s widest selection of fishing equipment. The sitecovers an area of approximately 30,000 ft2, with the warehouse facilitating the bulk pallet storage of largevolumes of imported goods from the Far East. The retail store at the site contributed approximately £312,000to Group revenues in the year ended 31 December 2014, which accounted for approximately 9 per cent.of the Group’s total revenues.

Barnsley

Located on the outskirts of Barnsley in the suburb of Darfield, this was the first of the ‘Fishing Republic’branded stores. The store is located in a building that was originally a cinema. The site has two floors,totalling 6,588 ft2 of floor space and is stocked mainly with coarse and carp fishing tackle, with a smalloffering of sea fishing equipment. In the year to 31 December 2014, the store generated approximately£435,000 of sales, which accounted for approximately 13 per cent. of the Group’s total revenues.

Doncaster

Located in the Wheatley area of Doncaster, the store is a former factory unit of 4,582 ft2 which was firstoccupied by the Group in 2008. It stocks coarse and carp fishing tackle only, and currently contributesapproximately 9 per cent. of total Group revenues, having turned over approximately £310,000 in the yearended 31 December 2014.

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Manchester

This site was originally a factory unit located on an estate in the Manchester suburb of Swinton and was thesecond ‘Fishing Republic’ store, opening in 2006. The store has a total area of 4,918 ft2 and stocks mostlycoarse and carp fishing tackle, with a smaller selection of sea and game fishing tackle. The Manchesterstore generated approximately £360,000 of revenues for the Group for the year ended 31 December 2014,contributing approximately 11 per cent. of total Group revenues.

Sheffield

The Sheffield store is located in Attercliffe, three miles from the Meadowhall shopping centre. It is housed ina former factory unit covering 4,172 ft2 and was opened in 2007. The store stocks coarse, carp and a smallselection of sea fishing equipment. It generated approximately £236,000 of revenues in the year to31 December 2014, representing approximately 7 per cent. of total Group sales.

Sunderland

Opened in 2007 in a converted manufacturing unit located on the outskirts of Sunderland, under a mile fromthe sea, the store is 5,612 ft2 in size and focuses mainly on sea fishing tackle. The store generated revenuesof approximately £228,000 in the year ended 31 December 2014, equivalent to approximately 7 per cent.of total Group turnover.

Hull

Set in a traditional terraced shop in a large housing estate, the Hull location is small compared to the typicalsize of the Group’s stores at approximately 1,500 ft2. It is a more traditional ‘tackle shop’, stocking onlycoarse and carp fishing tackle due to its size, and focusing predominantly on accessories. First opened in2006, the business was sold to its management in 2010, but returned to Group ownership in 2014. Thestore generated revenues of approximately £82,000 in the year ended 31 December 2014.

Lease arrangements

Subject to Admission, all seven stores will be leased from Steve Gross at an annual rental, in aggregate, of£30,000 per annum in 2015, £75,000 per annum in 2016 and £100,000 per annum in 2017. Details of thelease arrangements are set out at paragraph 10.10 of Part IV of this Document. The Relationship Agreement,summarised below and also in paragraph 10.8 of Part IV of this Document, has been entered into to seekto ensure that, amongst other matters, the lease arrangements are and will continue to be at arm’s lengthand on normal commercial terms.

Freehold site

The Group also owns the freehold to a site at Kilnhurst in Rotherham which was its former head office. At31 December 2014 the site had a net book value of £109,000. The Group still uses some of the storagespace at the site with the remaining space let on a month by month basis at the equivalent of £6,500 perannum. The Directors are seeking to let the site as a whole or dispose of the freehold interest which theyestimate would create a net gain of over £100,000.

Online Sales

Sales via the internet account for approximately 49 per cent. of Group revenue with approximately£1.7 million of online sales recorded for the year ended 31 December 2014. Sales via the eBay and Amazonwebsites account for the majority of online sales and the Group intends in the future to offer its products viaadditional third party online retailers, adopting a ‘multi-channel’ approach. In line with this strategy the Grouphas begun working with play.com, as another third party online retailer. The Group also operates two of itsown websites, www.fishingrepublic.net, which now displays over 16,500 different products across all typesof fishing disciplines, and www.yorkshiregameangling.co.uk, which is a dedicated website for game and flyfishermen. The Group’s websites are configured so that they only show products in stock at the Group’swarehouse or available to purchase from its stores therefore improving the online shopping experience.

The ‘Fishing Republic’ website was re-launched in May 2014 with enhanced functionality and a mobilefriendly interface. Importantly, the Group’s new website platform has multiple storefront capability enablingit to operate additional websites more easily. Online sales through the Group’s own websites for the yearended 31 December 2014 were £248,000, representing an increase of approximately 45 per cent. from

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sales of £170,000 the year ended 31 December 2013. In the six months to 30 April 2015 the average onlinebasket value for the Group's own ‘Fishing Republic’ website was £61.82 and the Group's ‘Yorkshire GameAngling’ website was £29.65. Average online baskets for the Groups product sold via Amazon and eBayare £16.47 and £15.80, respectively.

Product Ranges

The Group stocks a wide range of over 16,500 product lines aiming to cater for all types of fishing, beingcarp, coarse, game and sea. The product range extends to lines, reels, hooks, floats and flies, together withfishing accessories, such as seat boxes, sleeping bags, tents (or ‘bivvies’), alarms, weights, scales andluggage. The products stocked by the Group also includes a large range of consumables such as bait anda collection of clothing and footwear, including several of its own brands, which are manufactured for theGroup in the Far East.

Brands and Suppliers

‘Fishing Republic’ is both the Group’s main trading brand and the name under which the Group’s principalretail website operates. ‘Yorkshire Game Angling’ is a separate brand with its own dedicated website,supplying the game and fly fishing discipline. The Group sells many of the UK’s top fishing tackle brandsand third-party branded sales accounted for approximately 79 per cent. of the Group’s revenues in the yearended 31 December 2014. It stocks products from generalist suppliers, such as:

− Daiwa a fishing tackle brand with a broad product range across all fishing disciplines;

− Drennan a supplier of a range of fishing tackle and accessories, including clothing andluggage;

− Korda a specialist manufacturer of carp fishing tackle;

− Maver a fishing pole specialist focusing on match fishing;

− Middy a manufacturer of fishing tackle aimed predominantly at coarse andcompetition angling;

− Preston Innovations a generalist supplier of a wide range of fishing tackle;

− Pure Fishing a collection of twelve separate tackle brands across each of the fishingdisciplines;

− Shimano a supplier of general fishing tackle;

− Svendsen which includes the brand Okuma; a manufacturer of reels, rods and fishingaccessories; and

− Zebco a manufacturer of angling equipment supplying specialist retailers acrossEurope.

The Group has developed several of its own brands by working with manufacturers based in the UK and inthe Far East. ‘Klobba’, one of its key brands, is the Group’s outdoor clothing brand, supplying items suchas jackets, coats, boots and waders. The clothing is manufactured in the Far East and imported into theUK. With typical gross margins of around 65 per cent., the Directors believe that there is an opportunity togrow its own brand sales, which accounted for approximately 21 per cent. of its revenues in the year to31 December 2014 and benefit further from these higher margin items as the Group expands. The Group’sother own-brands include:

− Cobra supplying fly line for game and fly fishing;

− Highland Spirit rods aimed specifically at trout and salmon fishing; and

− Powerstorm a sea fishing brand;

− PredX offering lures for pike and predator fishing.

− Steve Clayton coarse fishing products;

− Theseus carp fishing products;

− Viper and Mamba game and fly fishing brands offering hooks and line;

− Wickhams offering flies, fly lines and specialist luggage.

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MarketingThe Group uses a wide variety of different marketing channels, including internet advertising and fishingpublications, such as the UK national weekly magazine Angler’s Mail and monthly magazines such as TotalCarp, Total Sea, Total Coarse and Total Fly.

Social media plays a key role in the Group’s marketing strategy, in order to engage with its customer base,particularly the younger fisherman. The Group operates a dedicated Twitter account and Facebook page,to which it frequently posts updates relating to stock availability, special offers, fishing events andcompetitions. The Group runs regular promotions, including offering fishing kits and money-off offers. In thefuture the Group intends to utilise its databases of over 123,000 customer email addresses to moreproactively market offers and promotions to its customer base.

To engage further with the customer, the Group periodically runs online competitions and promotions, suchas the ‘Catch of the Month’, where fishermen can send pictures of their catch to the ‘Fishing Republic’website for the chance to win prizes, such as discount on products. In the future, the Group also intends torun regular courses aimed at encouraging new fishermen into the sport to expand its customer base.

Following Admission, the Group intends to establish a Shareholder discount scheme. It is anticipated thatthe scheme will provide Shareholders with a substantial discount on products purchased from the Group,provided they hold a minimum number of Shares, The minimum Shareholding required to qualify for thescheme, the discount available and purchase limits will be confirmed when the scheme is launched.

IT and SystemsIn anticipation of its planned expansion, the Group recently invested in upgrading its IT systems, which arelocated at the Group’s head office in Rotherham. The IT systems monitor and control stock levels in all sevenof the Group’s stores and the main warehouse and also link into the Group’s two websites. The IT systemsare scalable and will, in the Directors’ opinion, with minimal additional investment, support the Group’scurrent growth strategy.

Market and CompetitionAngling overviewAngling is the sixth biggest sport in the UK as measured by once per month participation and, according tothe National Angling Strategy (2012), up to four million people had been fishing in the two years prior to itspublication. It generates approximately £3.5 billion a year for the economy and employs approximately37,000 people. The sport has been recognised by the UK Government as an important tool to improve anumber of socioeconomic factors, identified in four strategic objectives set out in the National AnglingStrategy, which are as follows:

– encouraging people to take up and continue fishing so it becomes a habit for life;

– angling to be recognised for its role in improving the nation’s health and wellbeing, increasingeducational attainment and reducing crime and anti-social behaviour;

– improving people’s lives by using angling as a catalyst for bringing people and society together; and

– for people to recognise that fish and fishing are at the heart of a better environment.

Types of fishingCarp fishing

Carp fishing is fishing in freshwater for various species of carp and accounted for approximately 36 per cent.of Group sales by discipline in the year to 31 December 2014. It is often grouped under the coarse fishingcategory, described in more detail below.

Coarse fishing

Coarse fishing is fishing for any freshwater fish, other than salmon or trout. Coarse fish species includeroach, perch, tench, bream, rudd, pike and chub, for example, and can often include carp. These fish arenot kept for eating and are returned. Coarse fishing represents the UK’s most popular discipline of the sportand, when taken with the sales figures for carp fishing, represented 82 per cent. of the Group’s total revenuesin the year to 31 December 2014.

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Game fishing

Game fishing is fishing for ‘game’ fish species which includes salmon, brown trout, sea trout and rainbowtrout. Anglers go fishing for these fish in streams, rivers and lakes/reservoirs i.e. in freshwater. These fishmay be kept for eating (subject to the fishing seasons and fishery rules). In the year to 31 December 2014,sales for game fishing represented approximately 13 per cent. of the Group’s total revenues.

Sea fishing

Sea fishing takes place in or by the sea and involves fishing for sea fish, such as bass, pollock, mackerel,plaice, cod and haddock, for example, and represented 5 per cent. of the Group’s total sales in the year to31 December 2014. Sea fishing also includes fishing in estuaries.

EquipmentEach discipline of the sport is catered for by a wide variety of equipment, which ranges from starter kits forbeginners through to specialist rods for competition anglers costing many thousands of pounds. In additionto a rod, reel and net there is a range of consumables that anglers across all disciplines require for eachfishing trip. These consumables include bait, hooks and lines. The bait now available for anglers ranges fromfrozen boilies (a carp fishing bait) through to specialist flavoured luncheon meat. There is also a wide rangeof specialist clothing including boots, jackets and waders designed specifically for each discipline of thesport. The range of fishing equipment has expanded over recent years to include items such as tackle carts,specialist seats and alarms to alert the fisherman to a bite on his line. In addition, for the dedicated carpfisherman there is also a wide range of specialist sleeping bags and tents for overnight fishing.

LicencesThere are several pieces of legislation governing fishing in the UK. In general, in England (with the exceptionof the River Tweed), Wales and the Border Esk region of Scotland, anyone over the age of 12 years oldrequires a fishing rod licence to fish for salmon, trout, freshwater fish, smelt and eel with a rod and line. Afishing rod licence, depending on the time period covered and the type of licence, costs between £3.75 (fora one-day non-migratory trout and a coarse licence) and £72 (for an adult applying for an annual salmonand sea trout licence). In England, each region is governed by its own set of byelaws (dictating the timesduring which fishing is permitted, for example) and fishermen require an additional licence in order to fish atthe locks or weirs on the River Thames, costing £28.50 for adults and £18.50 for children per year. Aseparate permit may also be required to fish in a particular fishery or body of water.

A fishing rod licence is required in Northern Ireland, which also governs the type of game or coarse fish that thefisherman is permitted to catch. A separate permit is also required to fish in a particular fishery or body of water.

Fishing regulations differ slightly in Scotland in that fishermen do not need a general Government-issuedfishing rod licence; instead they are required to apply for a permit for a specific body of water, which iscontrolled by the landowner, fishing association, angling club or commercial fishery. The permits set out thefishing regulations at each individual body of water, but there are several overriding laws, such as in the caseof salmon or sea trout fishing, which is prohibited on Sundays.

CompetitionThere is a wide cross section of fishing tackle retailers in the UK. These range from major sports and outdoorequipment retailers, such as Sports Direct, Go Outdoors and Decathlon, and country sports specialists,such as Orvis, to specialist fishing tackle retailers, like Fishing Republic, and smaller stores that have a morelimited range of equipment and primarily provide bait and other consumables for fisherman (often known as‘bait shops’). In addition the large internet retailers such as Amazon and eBay also serve competitors.

There are approximately 2,500 specialist fishing tackle retailers in the UK according to the Tackle TradeSurvey 2011. The retail value of the UK angling trade in 2011 was £541 million (exclusive of VAT). Thisrepresented an increase of approximately 5 per cent. from the value in 2006 of £515 million (exclusive ofVAT). The Directors believe this illustrates the robust nature of the fishing tackle market as the period from2006 to 2011 covers the effect of the most challenging period of the recent financial crisis affecting the UK.The same report also notes that the number of retailers fell from 2,700 in 2006 to 2,472 in 2011 (reflectinga trend towards larger retailers, which the Directors believe is continuing).

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The Directors believe the major sports and outdoor equipment retailers, where the sale of fishing tackle isonly part of their retail offering, do not necessarily stock the widest range of fishing equipment, nor do theyemploy staff with the breadth of knowledge of fishing when compared to the Group. The Directors believethat Fishing Republic’s large range of products and the advice offered by its highly knowledgeable salesstaff are both factors that appeal to regular anglers and have helped to build a loyal customer base. Inaddition, the Directors consider that the larger sports and outdoor equipment retailers benefit the specialistfishing tackle retailers as they encourage new entrants into the sport with starter kits and other entry levelequipment. As these anglers become more interested in the sport they are drawn towards specialist retailerslike Fishing Republic which stock a broader range of tackle.

In contrast to the larger sports, outdoor and specialist fishing tackle equipment retailers, the smaller baitshops, while larger in number, are constrained as to their competitiveness due to the relatively large workingcapital requirements in respect of stock. The Directors believe that with typically low turnover, it is difficultfor these retailers to fund this working capital requirement from existing resources and that it is difficult forsuch stores to secure external sources of financing.

Some of the specialist fishing tackle retailers employ heavy discounting pricing policies to attract customers.While Fishing Republic regularly offers discounts on product lines it is not the Company’s main strategy tocompete on price.

StrategyThe objective of the Group is to become the leading retailer of fishing tackle across the UK. Its strategies forachieving this can be summarised as follows:

‘Buy and build’The Directors believe that there is an opportunity to act as a consolidator in the sector and a key elementof the Company’s core strategy will be to broaden its geographic footprint by acquiring other specialistfishing tackle retailers. Specialist fishing tackle retailers tend to be characterised by owner-managed singleunit retail operations that are often run as ‘lifestyle’ businesses. The Directors believe that the Group is well-positioned to act as a consolidator in what is a highly fragmented market and are investigating a number ofacquisition opportunities. Acquiring other businesses will allow the Group to grow its customer base quickly,both in-store and online. Such acquisitions will also allow the Group to broaden its geographical coverage,infill within existing areas and extend into the South of England. In addition, the Company expects to benefitfrom increased buying power with manufacturers and suppliers which should result in improved margins orthe ability to offer customers lower prices, whilst still maintaining the Group’s margins.

The Group’s previous experience in the wholesale of fishing tackle means that it is well placed to identify thebusinesses where the owner is thinking of selling or retiring. The Directors believe that small fishing tackleretailers have also suffered following the financial crisis as they have found it harder to secure bank debt tofund the high levels of stock that attract fishermen to their stores, limiting potential opportunities for growth,which is another reason the Directors consider the sector to be ripe for consolidation.

Organic growthWhere the Directors believe there is a vibrant fishing community that is not well-served by a specialist fishingtackle retailer it will consider opening a new store. In line with this strategy the Group plans to open a new‘Fishing Republic’ store on the outskirts of Birmingham. The Group’s out of town centre/light industrial unitformat means that should a suitable location be identified it can relatively quickly seek to establish a newbranch of ‘Fishing Republic’. Furthermore, the Directors intend to expand the product range, in particularby targeting products and consumables serving the high-end carp fishing market.

Online offeringThe Group intends to build on its current own website sales growth by enhancing the site further includingthe introduction of a ‘click, try, buy’ format. This will allow customers to choose a product on the Group’swebsites and have the item delivered to their local store should they wish to try out the product prior topurchase. This will have the benefit of attracting customers into Fishing Republic stores where they will seethe large variety of products sold by the Group. In addition, the Group will seek to increase its use of social

Ann I, 6.5

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media to promote the ‘Fishing Republic’ brand and provide regular updates, including product offers, tonew and existing customers. The increased use of search engine optimisation tools should also mean thatthe ‘Fishing Republic’ website features more prominently when anglers are searching the internet for fishingtackle products. The Directors believe that the Group’s web presence will be a key driver of growth goingforward.

Acquisition of other tackle brandsThe Group owns a number of own-brand product lines, which it intends to add to via the selective acquisitionof other tackle brands, currently manufactured in the UK, which it believes it can source more cost effectivelyby using its existing suppliers in the Far East.

CoachingThe Group intends to run coaching courses for anglers as well as free taster sessions to get people interestedin the sport. Coaching sessions have the benefit of providing an additional revenue stream and alsopromoting the Fishing Republic brand to experienced anglers and those new to the sport.

Group Structure and Summary Financial Information

The Company was incorporated in August 2014 to act as a holding company for the Group for the purposesof the proposed Admission and acquired the entire share capital of the Group’s trading subsidiary, LureflashInternational Limited, on 20 May 2015. Further details are set out in paragraph 10.6 of Part IV of thisDocument. Lureflash was incorporated in August 1991 and is the entity through which the Group hasconducted its activities and trading.

A summary of the historical results for Lureflash for each of the three years ended 31 December 2012, 2013and 2014 is set out below.

Years ended 31 December2012 2013 2014

£ £ £Audited Audited Audited

Revenue 3,410,489 3,337,016 3,390,895Gross profit 1,614,631 1,578,185 1,553,435Operating profit 295,128 385,629 361,313Profit before taxation 279,965 364,450 294,516Net assets 730,440 1,017,573 1,254,326

Financial information on Fishing Republic and Lureflash is set out in Part III of this Document and readersshould not rely solely upon the summarised information set out above.

Current Trading and Prospects

The Group’s business is seasonal in nature from a profit perspective, with higher margin products such asconsumables being sold in the warmer spring and summer months when more people go fishing and withcapital items such as rods, reels, seat boxes and poles being sold in the colder autumn and winter months.Current trading is in line with Directors’ expectations, with unaudited revenue to 31 March 2015 of £681,483.Sales via the Group’s ‘Fishing Republic’ website platform, developed in 2014, continue to grow at ratesabove 30 per cent. year on year.

The Placing

In order to finance and provide working capital for the planned new Birmingham store provide working capitalfor development of the Group generally, including the expansion of the Group’s marketing activities, and tofund the costs associated with Admission, the Company is raising, conditional on Admission, a minimum of£1 million before expenses, through the issue of the Placing Shares at the Placing Price, to supplement theGroup’s existing cash resources.

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The Company, the Directors and Northland have entered into the Placing Agreement pursuant to which,subject to certain conditions, Northland has conditionally agreed to use its reasonable endeavours to procuresubscribers for the Placing Shares. The Placing Shares will represent approximately 42 per cent. of theEnlarged Share Capital.

The Placing Shares will be issued credited as fully paid and will, when issued, rank pari passu in all respectswith the then existing Shares, including the right to receive all dividends and other distributions declared,paid or made after Admission.

The Placing Agreement is conditional, inter alia, upon Admission having become effective by not later than8.00 a.m. on 4 June 2015 or such later time and date, being not later than 8.00 a.m. on 3 July 2015, as theCompany and Northland shall agree. Further details of the Placing Agreement are set out in paragraph 10.1of Part IV of this Document.

Directors

James Newman, aged 65, Independent Non-Executive Chairman

James is an experienced non-executive chairman and director of both Main Market and AIM companies.He was formerly chairman of Straight plc and Vianet plc and non-executive director of Dignity plc, ScottWilson Group plc and Richmond Foods plc. He is currently chairman of the Sheffield City Region LocalEnterprise Partnership and Finance Yorkshire. James’ executive career was as a group finance director ata number of public companies including Kelda Group plc, Bridon plc and Watmoughs (Holdings) plc. He isa Fellow of the Institute of Chartered Accountants and a member of the Association of Corporate Treasurers.

Stephen (Steve) John Gross, aged 44, Chief Executive Officer

Steve is the founder of the Group and has over 30 years’ experience in the fishing tackle industry. He is wellknown in angling circles and is a director and board member of the Angling Trade Association and theAngling Foundation, the two guiding bodies for the UK’s fishing tackle trade. He is also an accomplishedangler who represented England in competition and was captain of the England under-21 fly fishing team.

Robert Tippett, aged 37, Finance Director

Robert is a qualified chartered certified accountant and has had his own private practice since 2007, whichhas included work on mergers and acquisitions. He has been working with the Group since 2008.

Paul Hagerty, aged 31, IT Director

Paul joined the Company in 2005 and plays an important role in developing the Group’s IT systems, whichinclude stock control and management information. More recently his focus has been developing the Group’sonline presence, particularly via its ‘Fishing Republic’ website. Before joining the Group he worked as atechnical director at an independent website development company. He has a background in softwareprogramming and development.

Zoe Gross, aged 49, Operations Director

Following a 20 year corporate career with NatWest, Zoe joined the Group in 2009 and is a key part of themanagement team. Her role involves the operational management of the online and mail order distributionbusiness and the human resources department.

Edward (Ed) Peter McDermott, aged 33, Independent Non-Executive Director

Ed has over 10 years’ experience within financial services in the City of London and is currently a corporatefinance adviser at Optiva Securities Limited. He is a former director of AIM-quoted Noricum Gold Limitedand Stellar Resources plc. Ed is a keen angler and is an owner of Farlows Lake, a coarse fishery inBuckinghamshire.

Reasons for Admission and Use of Proceeds

The Directors believe that admission to trading on AIM will offer the Company a number of benefits, includingto:

− provide funding for organic expansion, in particular the planned store opening in Birmingham;

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− allow the Company to issue Shares as consideration for acquisitions, as part of its ‘buy and build’strategy;

– develop the Group’s online presence;

− enhance the credentials of the Group with existing and future customers and suppliers;

− provide access to equity capital; and

− raise the Group’s profile.

It is intended that the proceeds received from the Placing will be used as follows:

Total£’000

Birmingham store (fit-out and stock) 350Online marketing and brand development 175Capital expenditure on existing stores 75General working capital purposes 200Acquisition fund 250IPO costs and expenses 450

––––––––––––

£1,500––––––––––––––––––––––––

Relationship Agreement

On Admission, the Principal Shareholder and his related parties (as defined by the Aim Rules for Companies)will be interested, in aggregate, in 11,067,500 Shares, representing approximately 46.6 per cent. of theEnlarged Share Capital. In addition, the Principal Shareholder currently owns the freeholds, or superiorleaseholds, of the Group’s seven retail stores.

The Directors are satisfied that the Company is capable of carrying on its business independently of thePrincipal Shareholder and that all transactions and relationships between the Principal Shareholder and theCompany, in particular in relation to the leasing of properties by the Group, are and will continue to be atarm’s length and on normal commercial terms.

To seek to ensure that Shareholders are adequately protected in this regard and generally in relation to thesize of the Principal Shareholder’s (and his related parties’) shareholdings in the Company followingAdmission, the Company and Northland have entered into the Relationship Agreement with the PrincipalShareholder and Zoe Gross. Pursuant to the Relationship Agreement, the Principal Shareholder and ZoeGross have given certain undertakings to the Company and Northland to the effect that the Board canoperate on an independent basis and that all material transactions between the Group and companiesowned and controlled by the Principal Shareholder and Zoe Gross will be subject to review by theindependent directors of the Company at the relevant time. Further information on the RelationshipAgreement can be found at paragraph 10.7 of Part IV of this Document.

EIS and VCT StatusHMRC has provided advance clearance that the Company qualifies as a qualifying company for the purposesof EIS and VCT provisions. Neither the Company nor the Company’s advisers give any warranties orundertakings that EIS relief or VCT qualifying status will be maintained or not be withdrawn and should thelaw regarding EIS or VCT change then any reliefs or qualifying status previously obtained may be lost. Inparticular, certain change have been proposed by the Government which if enacted may prevent any sharesissued on or after 6 April 2015 from qualifying for the purposes of EIS/VCT.

If the Group ceases to carry on the business outlined in this Document or acquires or commences a businesswhich is not insubstantial to the Group’s activities and which is a non-qualifying trade for EIS and/or VCTpurposes during the three year period from the allotment of the Placing Shares, this could prejudice thequalifying status of the Company (as referred to above) under the EIS and/or VCT regimes. This situationwill be closely monitored with a view to seeking to preserve the Company’s qualifying status but this cannotbe guaranteed. Circumstances may arise where the Directors believe that the interests of the Company are

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not best served by acting in a way that preserves the EIS relief (including Capital Gains Tax) or/or VCTqualifying status. In such circumstances, the Company cannot undertake to conduct its activities in a waydesigned to secure or preserve any such relief or status claimed by any Shareholder. If the Company doesnot employ all of the proceeds of an EIS/VCT share issue (and other shares of the same class issued on thesame day) for qualifying trading purposes within 24 months of the share issue, the Placing Shares issued toEIS investors would cease to be eligible shares and all of the EIS tax reliefs of such investors would bewithdrawn.

In respect of share subscriptions made by a VCT, the funds invested by the VCT would be apportioned prorata and its qualifying holding would be equal to the VCT’s funds that had been employed for qualifyingtrading purposes within the above time limits. Any remaining element of the VCT’s investment wouldcomprise part of its non-qualifying holding.

The information in this Document is based upon current tax law and practice and other legislation and anychanges in the legislation or in the levels and bases of, and reliefs from, taxation may affect the value of aninvestment in the Company.

Admission, Dealings and CRESTApplication has been made to the London Stock Exchange for all of the Shares, including those issued andto be issued pursuant to the Placing, to be admitted to trading on AIM. It is expected that Admission willbecome effective and that dealings will commence in the Shares at 8.00 a.m. on 4 June 2015.

No temporary documents of title will be issued. All documents sent by or to a placee, or at its direction, willbe sent through the post at the placee’s risk. Pending the despatch of definitive share certificates,instruments of transfer will be certified against the register of members of the Company.

The Company has applied for the Shares to be admitted to CREST and it is expected that the Shares willbe so admitted and accordingly enabled for settlement in CREST on the date of Admission. Accordingly,settlement of transactions in Shares following Admission may take place within the CREST system if anyindividual Shareholder so wishes provided such person is a ‘system member’ (as defined in the CRESTRegulations) in relation to CREST.

CREST is a paperless settlement system enabling securities to be evidenced otherwise than by a certificateand transferred otherwise than by written instrument in accordance with the CREST Regulations. The Articlespermit the holding of Shares in uncertificated form in accordance with the CREST Regulations. CREST is avoluntary system and holders of Shares who wish to receive and retain share certificates will be able to do so.

Lock-ins and Orderly Market Undertakings

Each of the Directors who will hold Shares at Admission and existing Shareholders (together the “Locked-in Shareholders”), holding, in aggregate, 100 per cent. of the Existing Shares and approximately 58.5 percent. of the Enlarged Share Capital, has undertaken to the Company and Northland (subject to certainlimited exceptions including transfers to family members or to trustees for their benefit and disposals byway of acceptance of a recommended takeover offer of the entire issued share capital of the Company) notto dispose of the Shares held by each of them (and their connected persons (within the meaning of section252 of the Act)) (the “Restricted Shares”) following Admission or any other securities issued in exchange foror convertible into, or substantially similar to, Shares (or any interest in them or in respect of them) at anytime prior to the first anniversary of Admission (the “Lock-in Period”) without the prior written consent ofNorthland.

Furthermore, each of the Locked-in Shareholders has also undertaken to the Company and Northland notto dispose of the Restricted Shares for the period of 12 months following the expiry of the Lock-in Periodotherwise than through the Company’s broker from time to time (subject to certain exceptions).

Further information on the arrangements described above can be found at paragraph 10.5 of Part IV of thisDocument.

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Corporate Governance

The Directors recognise the value and importance of high standards of corporate governance and followingAdmission intend to take account of the recommendations in the QCA Code to the extent that they considerit appropriate having regard to the Company’s size, Board structure and resources.

With effect from Admission, the Board has established an audit committee (the “Audit Committee”) and aremuneration committee (the “Remuneration Committee”) with formally delegated responsibilities. TheBoard will undertake those functions normally associated with a nomination committee.

The Audit Committee will be chaired by Ed McDermott. Its other member will be James Newman. The AuditCommittee will have primary responsibility for monitoring the quality of internal controls and ensuring thatthe financial performance of the Company is properly measured and reported on. It will receive and reviewreports from the Company’s management and auditors relating to the interim and annual accounts and theaccounting and internal control systems in use throughout the Group. The Audit Committee will meet atleast twice a year and will have unrestricted access to the Company’s auditors.

The Remuneration Committee will be chaired by James Newman. Its other member will be Ed McDermott.The Remuneration Committee will review the performance of the Executive Directors and makerecommendations to the Board on matters relating to their remuneration and terms of employment. TheRemuneration Committee will also make recommendations to the Board on proposals for the granting ofshare options and other equity incentives pursuant to any share option scheme or equity incentive schemein operation from time to time. The remuneration and terms and conditions of appointment of the Non-Executive Directors will be set by the Board.

The Directors intend to comply, and procure compliance with, Rule 21 of the AIM Rules relating to dealingsby directors and other applicable employees in the Company’s securities and, to this end, the Companyhas adopted an appropriate share dealing code conditional upon Admission.

The Takeover CodeThe Takeover Code applies to the Company. Under Rule 9 of the Takeover Code, if an acquisition of interestsin shares carrying voting rights were to increase the aggregate holding of the acquirer and any person actingin concert with it (“concert parties”) to interests in shares carrying 30 per cent. or more of the voting rightsin the Company, the acquirer and, depending on circumstances, its concert parties would normally berequired (except with the consent of the Takeover Panel) to make a cash offer for the outstanding shares inthe Company at a price not less than the highest price paid for interests in shares by the acquirer or itsconcert parties during the previous 12 months (a “Rule 9 Offer”). The requirement to make a Rule 9 Offerwould also normally be triggered by any acquisition of interests in shares by a person holding (together withits concert parties) shares carrying between 30 per cent. and 50 per cent. of the voting rights in the Companyif the effect of such acquisition were to increase that person’s percentage interest in the Company’s sharesto which voting rights relate.

Under the Takeover Code, a concert party arises where persons who, pursuant to an agreement orunderstanding (whether formal or informal), co-operate to obtain or consolidate control (as defined below)of a company or to frustrate the successful outcome of an offer for a company. “Control” means a holding,or aggregate holdings, of shares carrying 30 per cent. or more of the voting rights of the company,irrespective of whether the holding or holdings give de facto control.

Immediately following Admission, the Principal Shareholder and his concert parties (the “Concert Party”) willhold, in aggregate, more than 50 per cent. of the Enlarged Share Capital. The Principal Shareholder will hold13,667,500 Shares, representing approximately 57.6 per cent. of the Enlarged Share Capital.

Since, immediately following Admission, the Concert Party will together hold more than 50 percent. of the Enlarged Share Capital, and provided it continues to hold more than 50 per cent. ofthe Enlarged Share Capital, it will be free to increase its aggregate holding of Shares without anyobligation to make a general offer for the Company under Rule 9, save that individual membersof the Concert Party may not, without the consent of the Takeover Panel, be able to increase theirinterests in Shares through 30 per cent. of the voting rights or between (and including) 30 percent. but no more than 50 per cent. of the voting rights) without incurring an obligation underRule 9 to make a general offer for the Company.

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Dividend Policy

The Board’s objective following Admission is to continue to grow the Group’s business and as such it is notexpected that the Directors will be recommending a dividend in the short to medium term, with any surpluscash resources being reinvested into development and growing the Group’s business. However, the Boardintends that the Company will recommend or declare dividends at some future date once it considers itcommercially prudent for the Company to do so, bearing in mind its financial position and the capitalresources required for its development.

TaxationInformation regarding taxation in relation to the Placing, Admission and the Shares is set out in paragraph 9of Part IV of this Document. If you are in any doubt as to your tax position you should consult your ownindependent financial adviser immediately.

Share Option PlansThe Directors believe that the commitment shown by the Group’s employees has played a major role in theGroup’s developments to date. Therefore the Directors propose to offer to directors and certain employeesthe opportunity to participate in the future success of the Group by adopting the Share Option Plans. TheShare Option Plans will be administered by the Remuneration Committee.

One of the Share Option Plans is intended to qualify as an enterprise management incentive or “EMI”arrangement pursuant to Schedule 5 to the Income Tax (Earnings and Pensions) Act 2003.

Conditional upon Admission, the Remuneration Committee will grant options under the Share Option Plansover Shares with a market value of, in aggregate, £207,000 to the Directors and employees of the Group.All share options will have an exercise price equal to the closing mid-market price of a Share on the day ofAdmission and will be exercisable for a period of three to ten years from the date of grant.

A summary of the main provisions of the Share Option Plans is set out in paragraph 4 of Part IV of thisDocument.

Additional InformationYour attention is drawn to the further information set out in the remainder of this Document and, in particular,to the risk factors set out in Part II of this Document.

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PART II

RISK FACTORS

Investing in and holding Shares involves financial risk. Investors in the Shares should carefullyreview all of the information contained in this Document and should pay particular attention tothe following risks associated with an investment in the Shares, the Group’s business and theindustry in which it participates which should be considered together with all other informationcontained in this Document. As the risks which the Group faces relate to events and depend oncircumstances that may or may not occur in the future, prospective investors should consider,among other things, the risks and uncertainties described below.

The risks and uncertainties described below are not an exhaustive list and do not necessarilycomprise all, or explain all, of the risks associated with the Group and the industry within whichit operates or an investment in the Shares (but do comprise the material risks and uncertaintiesin this regard that are known to the Company) and should be used as guidance only, neither arethey presented in any particular order of priority. Additional risks and uncertainties relating to theGroup and/or the Shares that are not currently known to the Company, or which the Companycurrently deems immaterial, may arise or become (individually or collectively) material in thefuture and may have a material adverse effect on the Group’s business, results of operations,financial condition and prospects and, if any such risk or risks should occur, the price of theShares may decline and investors could lose all or part of their investment.

The order in which the risks are presented does not necessarily reflect the likelihood of theiroccurrence or the magnitude of their potential impact on the Group’s business, financialcondition, results of operation, future prospects or the trading price of the Shares.

Investors should consider carefully whether an investment in the Shares is suitable for them inthe light of the information in this Document and their personal circumstances. Investors shouldconsult a legal adviser, an independent financial adviser or a tax adviser for legal, financial or taxadvice if they do not understand this Document (or any part of it).

Risks relating to the Group’s business and the retailing of fishing tackle

A decline in consumer spending or a change in consumer preferencesThe Group’s sales depend on consumer spending, which is influenced by factors beyond the Group’scontrol, including general economic conditions in the UK, general global macroeconomic conditions, grossdomestic product, employment levels, the availability of discretionary income and credit to consumers,consumer confidence, tax or interest rate fluctuations and unemployment levels. Global or national politicalunrest or uncertainty may impact the price paid by consumers for goods, services and commodities, reduceconsumer spending and confidence and reduce the Group’s sales or profitability.

The Group may experience declines in sales or margins or changes in the types of fishing tackle productssold during economic downturns. The success of the Group’s business depends in part on its ability toidentify and respond to evolving trends in demographics and consumer preferences. Failure to identify oreffectively respond to changing consumer tastes, preferences and spending patterns, as well as trends inthe fishing sector could adversely affect the Group’s business.

Fishing and the purchase of fishing-related products and services may constitute discretionary income orspending for some customers, and any material decline in the amount of consumer discretionary income orspending could reduce overall levels of spending on fishing tackle and adversely affect the Group’s sales ofproducts and services, including through impulse purchases. If any such declines occurred and wereprolonged or severe, they could have a material adverse effect on the Group’s business, results of operationsor financial condition.

Failure by the Group to compete effectively with its existing and potential future competitorsThe Group competes with a number of other participants in the fishing tackle market. These competitorsinclude other specialist fishing tackle retailers and larger retail chains where the sale of fishing tackle is one

Ann I, 4

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of many areas of products sales. In addition, most retailers are now able to reach a wide audience of potentialcustomers via their own websites. The retail of fishing related equipment in the UK could become increasinglycompetitive as independent stores make greater use of online sales via their websites and if larger chainsof stores decide to offer fishing tackle for sale (or increases the range of products currently offered for sale).

It is also possible that new entrants could come into the UK fishing tackle market from abroad, in particular,from the US. There can be no assurance that the Group will not face greater competition from these orother competitors in the future. In particular, if any of the Group’s major competitors seek to gain or retainmarket share by reducing prices, the Group may need to reduce its prices in order to remain competitive,which could require a change in operating strategies, thereby resulting in decreased profitability for theGroup.

If the Group cannot respond adequately to these multiple sources and types of competition then it couldexperience lower levels of sales and profitability, which could have a material adverse effect on the Group’sbusiness, results of operations or financial condition or result in a loss of market share.

Failure to identify and acquire new stores and execute the Group’s buy and build strategyIn line with its buy and build strategy, the Group may acquire other businesses if suitable opportunitiesbecome available. Any future acquisition poses integration and other risks which may significantly affect theGroup’s results or operations. To the extent that suitable opportunities arise, the Group may expand itsbusiness through the identification and acquisition of new stores, companies, technologies, products andservices.

There can be no assurance that the Group will identify suitable acquisitions or opportunities, obtain thefinancing necessary to complete and support such acquisitions or acquire properties or businesses onsatisfactory terms, or that any business acquired will prove to be profitable. In addition, the acquisition andintegration of independent businesses and the opening of new stores is a complex, costly and time-consuming process involving a number of possible problems and risks, including possible adverse effectson the Group’s operating results, diversion of management’s attention, failure to retain personnel, failure tomaintain customer service levels, disruption to relationships with customers and other third parties, risksassociated with unanticipated events or liabilities and difficulties in the assimilation of the operations,technologies, systems, services and products of the acquired companies.

No assurance can be given that the Group will be able to manage future acquisitions or new store openingsprofitably or to integrate such acquisitions or new store openings successfully without substantial costs,delays or other problems and any failure to achieve successful integration of such acquisitions or new storeopenings could have a material adverse effect on the results of operations or financial condition of the Group.If the Group is unable to attract and retain key officers, managers and technical personnel, its ability toexecute its business strategy successfully and to provide quality services to its customers could be materiallyand adversely affected.

A significant portion of the Group’s online revenue is attributable to sales via the eBay andAmazon websitesSales via the eBay and Amazon websites currently account for the majority of the Group’s online sales.These channels, and other channels through which the Group currently offers its products for sale, have noobligation to do business with the Group or to allow the Group access to their systems, and they may decideat any time and for any reason to curtail significantly or inhibit the Group’s ability to sell its products throughtheir channels. Additionally, eBay or Amazon or any of those other channels may decide to make significantchanges to their respective business models, policies, systems or plans, and those changes could impairor inhibit the Group’s ability to sell its products through those channels, or may adversely affect the volumesand/or prices of products that can be offered for sale by the Group via those channels or reduce thedesirability of selling on those channels. Furthermore, eBay or Amazon or any of those other channels coulddecide to compete with the Group more vigorously. Any of these results could significantly reduce theGroup’s online revenue and thereby materially and adversely impact the Group’s business, results ofoperations, financial condition or result in a loss of market share.

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Leases over Sunderland and Rotherham storesThe lease in respect of the Group’s Sunderland store contains a prohibition on any use other than as factorypremises. The lease in respect of the Group’s Rotherham store contains a prohibition on any use other thanas light industrial premises; it specifically prohibits use as retail premises. The Group proposes to seek toagree variations to both leases to permit the current use (that is, as retail premises). There is a risk of thelandlord of the relevant property not agreeing to the variation and initiating proceedings to forfeit the relevantlease, and so bring the term of the relevant lease to an end, on the grounds that the tenant is in breach ofthe permitted use under the relevant lease. In the case of the Rotherham store, this is mitigated by the factthat the Principal Shareholder and Zoe Gross are the owners of both the freehold and the leasehold of theproperty. In addition, the Group will need the consent of Bank of Scotland Plc to vary the lease in respectof the Sunderland store and the consent of HSBC Bank Plc to vary the lease in respect of the Rotherhamstore. The failure of the Group to secure the variations and/or required consents could have a materialadverse effect on the Group’s business, results of operations or financial condition.

The retail use of some of the Group’s store may not be permitted under applicable planningpermissionsNone of the properties which are occupied by the Group, save for that at Southcotes Lane, Hull, haveplanning permission to be operated as retail premises. Accordingly the relevant local planning authority foreach such property could seek to take enforcement action against the Group in respect of one or more ofsuch properties. There are a range of enforcement powers available to local planning authorities includinginviting a retrospective application for planning permission; issuing a ‘stop notice’ or ‘temporary stop notice’(which prohibits activities comprising the alleged breach and will specify the date when relevant activitieshave to be stopped by (usually no less than three days or later than 28 days after service)); and seeking aninjunction. Any enforcement action could restrict or prevent the Group’s ability to trade at such a property(either permanently or whilst appropriate permissions are sought (there being no guarantee that suchpermissions would be forthcoming)) and would likely result in the Group incurring additional costs (includingprofessional fees and expenses). In the case of the Group’s Barnsley and Rotherham stores, this is mitigatedby the fact that because each of the properties has been used continuously without interruption for anunpermitted use for a period of 10 years, then, generally, the right for the local council (as local planningauthority) to take action for breach of planning control will have been lost as the unauthorised use becomeslawful and immune from enforcement action. Of the properties which do not having planning permissionand which have not been used continuously without interruption for an unpermitted use for a period of 10years, two (the Group’s Manchester and Sunderland stores) have been operated as retail premises for nineyears, and two (the Group's Sheffield and Doncaster stores) have been operated as retail premises for eightyears. The failure of the Group to obtain the appropriate permissions could have a material adverse effecton the Group's business, results of operations or financial condition.

Lack of funding available to the GroupFollowing the first 12 months after Admission, the Group may need additional working capital as itimplements its strategy. Such funds may not be available on acceptable terms or at all when required and,without additional funds, the Group may not be able to effectively execute its growth strategy, take advantageof future opportunities, respond to competitive pressures or unanticipated requirements.

Failure to develop the Fishing Republic brand and the Group’s other brands or to successfullymanage and execute the Group’s marketing and advertising initiativesThe Group’s success and growth depends, in part, on the ability of the Group to manage and execute itsmarketing and advertising initiatives in order to reinforce its retail proposition, as well as its ability to raiseawareness of the Group’s broad product range and pricing. The Group’s growth also depends on its abilityto increase customer traffic and average transaction amount to gain sales momentum in the Group’s storesand on the Group’s websites.

However, there can be no assurance that the Group’s strategy to develop and enhance the Fishing Republicbrand and the Group’s other brands will be successful. The Group may not be able to execute successfullyits marketing and advertising initiatives to realise the intended benefits and growth prospects due to poorexecution, as well as due to factors outside of the Group’s control such as increased competition ordeterioration of general economic conditions, thus limiting the Group’s ability to capitalise on businessopportunities and expand its business.

24

The failure of any of these strategies may damage the reputation and value of the Group’s brands andadversely affect the Group’s business, results of operations or financial condition.

Reliance on key suppliers including the suppliers of own brand product lines to the GroupThe Group relies upon certain key suppliers which, if relationships with such suppliers are not maintained,could in the short term disrupt the Group’s business, in particular in respect of suppliers of certain productsfrom a limited number of brand owners/manufacturers. Although alternative suppliers are likely to be readilyavailable to provide the services or supplies required by the Group, any disruption to supply or transitionbetween suppliers may adversely impact the Group’s business until an alternative supplier can be engagedand products shipped. The costs of alternative supplier may increase the Group’s cost base and, as a result,adversely affect the Group’s business, results of operations or financial condition.

The Group may not be able to predict accurately or fulfil customer preferences or demand ormanage successfully its inventory from time to timeThe Group is exposed to inventory risks that may adversely affect the Group’s operating results as a resultof new product launches, changes in customer preference or demand and consumer spending patternswith respect to the Group’s products. Demand for products can change between the time inventory isordered and the date of sale. In addition, when the Group begins selling a new product, it may be difficultto establish supplier relationships, determine appropriate product selection and accurately forecast demand.The Group carries a broad selection of certain products and may be unable to sell products in sufficientquantities or during the relevant selling seasons.

If the Group fails to predict or respond to sales demand or to changing customer preferences successfully,then the Group’s sales may decline, its inventory could become overstocked, and the Group may be forcedto rely on discounts or promotional sales to dispose of excess or slow-moving inventory. Moreover, anysuch failure could also result in inventory shortfalls on popular merchandise.

Any one of these risks may adversely affect the Group’s business, results of operations or financial condition.

Dependence on key personnelThe Group has a relatively small senior management team and the loss of any key individual or the inabilityto attract appropriate personnel could impact upon the Group’s future performance.

Weather conditionsThe Group’s sales are sensitive to weather conditions. In general, the Group sees a reduction of sales, inparticular consumables such as bait, lines and hooks, during the winter period as customers tend not to gofishing when the weather is less favourable. Consequently prolonged periods of bad weather could adverselyaffect the Group’s business, results of operations or financial condition.

Failure of the Group’s information technology, network or communications systemsThe efficient operation of the Group’s business is dependent on its key operational business systems. Inparticular, the Group relies on its information technology or communication systems to manage effectivelyits sales, warehousing, distribution, merchandise planning and replenishment functions and to maintain itsin-stock positions and a record of its financial position.

Any significant disruption to these information technology or communications systems could have an adverseeffect on the proper functioning of the Group’s businesses, both at the point of sale and with regard to storereplenishment and distribution activities, which can be affected by short-term system failures, and on theGroup’s ability to maintain its financial records and produce timely financial information to enable it to manageits operations.

The failure of the Group’s information technology or communication systems to perform as designed, dueto failure to manage disasters, security breaches, computer viruses or any other interruption affecting anysuch system for a significant period of time could disrupt the Group’s business. Any of the foregoing couldhave a material adverse effect on the Group’s business, results of operations or financial condition.

25

Intellectual property rightsThe Group’s business carries with it, in relation to its own brand products and clothing, the risk of allegedintellectual property rights, infringement, including but not limited to: copyright infringement, design rightinfringement, trade mark infringement and passing off.

No claims for alleged intellectual property infringement have been made against the Group to date and noclaims have been made by the Group against other businesses for alleged infringement of the Group’sintellectual property rights.

Not all of the Group’s brands and/or logos will have been registered. The unregistered brands and logosused by the Group include Lamoustreme, Powerstorm, Predx, Steve Clayton, Theseus, Wickhams andYorkshire Game Angling. The Group currently relies on common law for protection of these brands and/orlogos, but intends to apply for registration of these brands and/or logos following Admission. It is possiblethat the Group may not be able to register certain of these brands and/or logos if trade mark applicationshave been filed in the intervening period which are similar or identical to any of the Group's unregisteredbrands and/or logos. Accordingly, this could have a material or adverse effect on the Group’s business,result of operations or financial condition.

Currency fluctuations could materially adversely affect the Group’s results.The Group’s results can be affected by fluctuations in currency exchange rates. The Group’s sales aredenominated in pounds sterling, and the Group reports its consolidated financial results in pounds sterling.However, the Group sources a large amount of its products from outside the UK and in particular from theFar East, where the principal currency of purchase is US dollars. The Group’s non-UK purchases in USdollars give rise to an exposure to changes in exchange rates between pounds sterling and US dollars. Theexchange rate between US dollars and pounds sterling has fluctuated significantly in recent years and mayfluctuate significantly in the future. Although the Group may benefit from any weakening of the US dollar, itcould be adversely affected by future unfavourable shifts in currency exchange rates, particularly by astrengthening of the US dollar compared to the pounds sterling. Consequently the Group’s results may beadversely affected by currency fluctuations.

Health and safetyThe Group’s activities will be subject to health and safety standards and regulations. Failure to comply withsuch requirements may result in fines and or penalties being imposed against the Group.

LitigationLegal proceedings, with or without merit, may arise from time to time in the course of the Group’s business.The Directors cannot preclude litigation being brought against any member of the Group and any litigationbrought against the Group could have a material adverse effect on the financial condition, results oroperations of the Group. The Group’s business may be materially adversely affected if the Group and/or itsemployees or agents are found not to have met the appropriate standard of care or exercised their discretionor authority in a prudent or appropriate manner in accordance with accepted standards.

TaxationThe attention of investors is drawn to paragraph 9 of Part IV of this Document. Any change in the Group’stax status or in taxation legislation or its interpretation could affect the value of the investments held by theGroup, affect the Group’s ability to provide returns to Shareholders and/or alter the post-tax returns toShareholders. Representations in this Document concerning the taxation of the Group and its investors arebased upon current tax law and practice which is subject to change.

Risks relating to the Shares and Admission

SuitabilityInvestment in the Shares may not be suitable for all readers of this Document. Readers are accordinglyadvised to consult a person duly authorised under the FSMA who specialises in investments of this naturebefore making any investment decisions.

Ann III, 2

26

Investment in AIM-traded securitiesInvestment in shares traded on AIM involves a higher degree of risk and such shares may be less liquid thanshares in companies which are listed on the Official List of the UKLA. The AIM Rules are less demandingthan the rules that apply to companies on the Official List of the UKLA. It is emphasised that no applicationis being made for the admission of the Company’s securities to the Official List of the UKLA. An investmentin the Shares may be difficult to realise. Prospective investors should be aware that the value of an investmentin the Company may go down as well as up and that the market price of the Shares may not reflect theunderlying value of the Group. Investors may therefore realise less than, or lose all of, their investment.

Share price volatility and liquidityThe share price of quoted companies can be highly volatile and shareholdings can be illiquid. The price atwhich the Shares are quoted and the price which investors may realise for their Shares will be influenced bya large number of factors, some specific to the Group and its operations and others which may affect quotedcompanies generally. These factors could include the performance of the Group, large purchases or salesof the Shares, currency fluctuations, legislative changes and general economic, political, regulatory or socialconditions.

The Company may not be able to pay dividendsThe Company’s ability to pay dividends to Shareholders will, in part, depend on the availability and upstreampayment of cash to the Company from other members of the Group. The Company’s principal operatingsubsidiary is Lureflash and, therefore, the Company does not directly receive cash generated by theunderlying revenues of the Group. The ability of Lureflash (and any other Group entities that may beincorporated from time to time) to make upstream cash distributions or loans to each other and the Companyis generally subject to applicable laws, such as entities’ organisational documents, maintenance of capitalrules, the terms of any financing arrangements, accounting treatment and other factors. Applicable lawsmay require such entities to comply with, amongst other things, restrictions on the amounts distributed byway of dividend, capital and reserve maintenance principles or require them to obtain shareholder or courtapproval. Applicable laws may also restrict the making of any distribution, loan or other payment or thetiming of it. There can be no assurance that the Group will be able to comply with any laws or requirementsregulating upstream cash distributions, loans or payments directly or indirectly to the Company.

Access to further capitalThe Group may require additional funds to respond to business challenges or to enhance existing productsand services. Accordingly, the Group may need to engage in equity or debt financings to secure additionalfunds. If the Company raises additional funds through further issues of equity or convertible debt securities,the then existing Shareholders could suffer significant dilution, and any new equity securities could haverights, preferences and privileges superior to those of the then current Shareholders. Any debt financingsecured by the Group in the future could involve restrictive covenants relating to its capital raising activitiesand other financial and operational matters, which may make it more difficult for the Group to obtainadditional capital and to pursue business opportunities. In addition, the Company may not be able to obtainadditional financing on terms favourable to it, if at all. If the Group is unable to obtain adequate financing orfinancing on terms satisfactory to it, when the Group requires it, the Group’s ability to continue to supportits business growth and to respond to business challenges could be significantly limited or could affect itsfinancial viability.

Future sale of SharesThe Company is unable to predict when and if substantial numbers of Shares will be sold in the open marketfollowing Admission. Any such sales, or the perception that such sales might occur, whether by a Directoror otherwise could result in a material adverse effect on the market price of the Shares or could affect theCompany’s ability to obtain further capital through an offering of equity securities. If available, future equityfinancings to provide capital may dilute the then Shareholders’ proportionate ownership in the Company.Any such issues may exclude the pre-emption rights pertaining to the then outstanding Shares. If theCompany raises amounts of capital by these or other means, it could cause dilution for the then existingShareholders. Moreover, the further issue of Shares could have a negative impact on the trading price andincrease the volatility of the market price of the Shares. The Company may also issue further Shares, orcreate further options over Shares, as part of its employee remuneration policy, which could, in aggregate,

27

create a substantial dilution in the value of the Shares and the proportion of the Company’s share capital inwhich investors are interested.

No prior trading market for SharesPrior to the Admission, there was no public market for the Shares. There can be no assurance that an activemarket for (and hence strong liquidity in the trading of) the Shares will develop upon Admission, or ifdeveloped, that such market will be sustained.

Shares may be sold by the Principal Shareholder, and others, once the lock-in periods haveexpiredAs noted in Part I of this Document and paragraph 10.5 of Part IV of this Document, the PrincipalShareholder, and others, will be restricted from selling their Shares for a period following Admission, withoutthe prior written consent of the Company’s broker (not to be unreasonably withheld or delayed). On theexpiry of the relevant lock-in periods, the Principal Shareholder, and others, will be required to trade in theShares through the Company’s broker, for a further 12 months, in each case for the purposes of preservingan orderly market in the Shares. Thereafter, these Shareholders will be permitted to sell their respectiveShares freely. Any such sale(s) could devalue of the price of the Shares by increasing the supply offered toAIM and/or decreasing general market confidence in the Company.

Interests of major ShareholdersOn Admission and in addition to the interests of the Directors and their Connected Persons (as defined andset out in paragraph 6.1 of Part IV of this Document), certain Shareholders, whose names are set out inparagraph 6.4 of Part IV of this Document, will hold, in aggregate, approximately 19.2 per cent. of theEnlarged Share Capital. These Shareholders will be able to exercise significant influence over the Companyand the Group’s operations, business strategy and those corporate actions that require the approval of theShareholders.

THE RISKS NOTED ABOVE DO NOT NECESSARILY COMPRISE ALL RISKS FACED BY THEGROUP AND ARE NOT INTENDED TO BE PRESENTED IN ANY ASSUMED ORDER OF PRIORITY.

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PART III (A)

ACCOUNTANTS’ REPORT ON THE FINANCIAL INFORMATION OF

LUREFLASH INTERNATIONAL LIMITED

The Directors 29 May 2015Fishing Republic plcVulcan WorksChesterton RoadEastwood Trading EstateRotherhamSouth Yorkshire S65 1SU

The DirectorsNorthland Capital Partners Limited131 Finsbury PavementLondon EC2A 1NT

Dear Sirs

We report on the financial information (the “Financial Information”) set out below on Lureflash InternationalLimited (“Lureflash”). This has been prepared for inclusion in the AIM admission document (the “Document”)dated 29 May 2015 of Fishing Republic plc (the “Company”) on the basis of the principal accounting policiesset out in Note 4 to the Financial Information. This report is required by Schedule Two of the AIM Rules andis given for the purpose of complying with that schedule and for no other purpose.

ResponsibilitiesThe Directors of the Company are responsible for preparing the Financial Information on the basis set outbelow and in accordance with applicable International Financial Reporting Standards (“IFRS”) as adoptedfor use in the European Union.

It is our responsibility to form an opinion as to whether the Financial Information gives a true and fair view,for the purposes of the Document, and to report our opinion to you.

Save for any responsibility arising under Paragraph (a) of Schedule Two of the AIM Rules for Companies toany person as and to the extent there provided, to the fullest extent permitted by law we do not assumeany responsibility and will not accept any liability to any person other than the addressees of this letter forany loss suffered by any such person as a result of, arising out of, or in connection with this report or ourstatement, required by and given solely for the purposes of complying with Paragraph (a) of Schedule Twoof the AIM Rules for Companies, consenting to its inclusion in the Document.

Crowe Clark Whitehill LLP

Chartered Accountants

Member of Crowe Horwath International

St Bride’s House, 10 Salisbury Square

London EC4Y 8EH, UK

Tel: +44 (0)20 7842 7100

Fax: +44 (0)20 7583 1720

DX: 0014 London Chancery Lane

www.croweclarkwhitehill.co.uk

29

Basis of opinionWe conducted our work in accordance with Standards for Investment Reporting issued by the AuditingPractices Board in the United Kingdom. Our work included an assessment of evidence relevant to theamounts and disclosures in the Financial Information. It also included an assessment of significant estimatesand judgements made by those responsible for the preparation of the Financial Information underlying thefinancial statements and whether the accounting policies are appropriate to the entity’s circumstances,consistently applied and adequately disclosed.

We planned and performed our work so as to obtain all the information and explanations which weconsidered necessary in order to provide us with sufficient evidence to give reasonable assurance that theFinancial Information is free from material misstatement whether caused by fraud or other irregularity or error.

OpinionIn our opinion the Financial Information gives, for the purposes of the Document, a true and fair view of thestate of affairs of Lureflash as at the dates stated and of its profits and cash flows for the periods then endedin accordance with the basis of preparation set out below and in accordance with applicable IFRS and hasbeen prepared in a form that is consistent with the accounting policies adopted by the Company.

DeclarationFor the purposes of Paragraph (a) of Schedule Two of the AIM Rules we are responsible for this report aspart of the Document and declare that we have taken all reasonable care to ensure that the informationcontained in this report is, to the best of or knowledge, in accordance with the facts and contains noomission likely to affect its import. This declaration is included in the Document in compliance with ScheduleTwo of the AIM Rules.

Yours faithfully

Crowe Clark Whitehill LLPChartered Accountants

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STATEMENTS OF FINANCIAL POSITIONThe statements of financial position of Lureflash as at 31 December 2012, 2013, 2014 are set out below:

As at 31 December2012 2013 2014

Note £ £ £Non-current assetsGoodwill 6 15,937 14,687 13,437Property, plant and equipment 5 132,974 115,944 132,641Deferred tax asset 7 137,999 90,682 22,919

––––––––––––– ––––––––––––– –––––––––––––

286,910 221,313 168,997––––––––––––– ––––––––––––– –––––––––––––

Current assetsInventories 8 1,949,178 2,156,572 1,908,666Trade and other receivables 9 101,302 46,042 213,513Deferred tax asset 7 75,000 45,000 55,000Cash and cash equivalents 10 7,106 6,090 51,716

––––––––––––– ––––––––––––– –––––––––––––

2,132,586 2,253,704 2,228,895––––––––––––– ––––––––––––– –––––––––––––

Total Assets 2,419,496 2,475,017 2,397,892––––––––––––– ––––––––––––– –––––––––––––––––––––––––– ––––––––––––– –––––––––––––

Non-current liabilitiesInterest bearing loans and borrowings 14 307,884 276,494 241,254

––––––––––––– ––––––––––––– –––––––––––––

Current liabilitiesTrade payables 13 628,324 534,057 491,854Other payables and accruals 13 349,081 380,430 265,264Bank overdrafts 14 50,818 7,094 –Non-interest bearing loans from directors 20 321,949 227,869 110,694Interest bearing loans and borrowings 14 31,000 31,500 34,500

––––––––––––– ––––––––––––– –––––––––––––

1,381,172 1,180,950 902,312––––––––––––– ––––––––––––– –––––––––––––

Total Liabilities 1,689,056 1,457,444 1,143,566––––––––––––– ––––––––––––– –––––––––––––

EquityShare capital 11 1,375,000 1,375,000 1,375,000Reserves 12 (644,560) (357,427) (120,674)

––––––––––––– ––––––––––––– –––––––––––––

730,440 1,017,573 1,254,326––––––––––––– ––––––––––––– –––––––––––––

Total Equity and Liabilities 2,419,496 2,475,017 2,397,892––––––––––––– ––––––––––––– –––––––––––––––––––––––––– ––––––––––––– –––––––––––––

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STATEMENTS OF COMPREHENSIVE INCOMEThe statements of comprehensive income of Lureflash for each of the three years ended 31 December 2014are set out below:

As at 31 December2012 2013 2014

Note £ £ £

Revenue 15 3,410,489 3,337,016 3,390,895Cost of sales (1,795,858) (1,758,831) (1,837,460)

––––––––––––– ––––––––––––– –––––––––––––

Gross profit 1,614,631 1,578,185 1,553,435Other income 16 10,285 4,970 9,560Selling and distribution expenses (781,818) (723,724) (724,555)Administrative expenses (547,970) (473,802) (477,127)

––––––––––––– ––––––––––––– –––––––––––––

Operating profit 295,128 385,629 361,313Finance costs 19 (15,163) (21,179) (66,797)

––––––––––––– ––––––––––––– –––––––––––––

Profit on ordinary activities before taxation 17 279,965 364,450 294,516Income tax expense 18 (50,061) (77,317) (57,763)

––––––––––––– ––––––––––––– –––––––––––––

Profit after taxation 229,904 287,133 236,753––––––––––––– ––––––––––––– –––––––––––––

Other comprehensive income – – –––––––––––––– ––––––––––––– –––––––––––––

Total comprehensive income attributable to the equity owner 229,904 287,133 236,753

––––––––––––– ––––––––––––– –––––––––––––––––––––––––– ––––––––––––– –––––––––––––

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STATEMENTS OF CHANGES IN EQUITYThe statements of changes in equity of Lureflash for each of the three years ended 31 December 2014 areset out below:

Share Accumulatedcapital losses Total equity

£ £ £

Balance at 1 January 2012 1,375,000 (874,464) 500,536Profit after taxation for the financial year – 229,904 229,904

––––––––––––– ––––––––––––– –––––––––––––

Balance at 31 December 2012 and brought forward at 1 January 2013 1,375,000 (644,560) 730,440Profit after taxation for the financial year – 287,133 287,133

––––––––––––– ––––––––––––– –––––––––––––

Balance at 31 December 2013 and brought forward at 1 January 2014 1,375,000 (357,427) 1,017,573Profit after taxation for the financial year – 236,753 236,753

––––––––––––– ––––––––––––– –––––––––––––

Balance at 31 December 2014 1,375,000 (120,674) 1,254,326––––––––––––– ––––––––––––– –––––––––––––––––––––––––– ––––––––––––– –––––––––––––

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STATEMENTS OF CASH FLOWSThe statements of cash flow statements of Lureflash for each of the three years ended 31 December 2014are set out below:

Years ended 31 December2012 2013 2014

£ £ £

Cash flow from operating activitiesProfit for the period before taxation 279,965 364,450 294,516Adjustment for:Depreciation of property, plant and equipment 31,286 16,432 10,427Interest expense 15,163 21,179 66,797Profit on disposal of plant and equipment – (4,754) (167)

––––––––––––– ––––––––––––– –––––––––––––

Operating cash flows before movements in working capital 326,414 397,307 371,573

(Increase)/decrease in inventories (186,172) (207,394) 247,906(Increase)/decrease in trade and other receivables 55,025 55,260 (167,471)Increase/(decrease) in trade and other payables (84,450) (62,918) (157,369)

––––––––––––– ––––––––––––– –––––––––––––

Net cash generated from operating activities 110,817 182,255 294,639––––––––––––– ––––––––––––– –––––––––––––

Cash flows (for)/form investing activitiesAcquisition of property, plant and equipment (270) – (25,874)Proceeds from disposal of property, plant and equipment – 6,600 167

––––––––––––– ––––––––––––– –––––––––––––

Net cash used in investing activities (270) 6,600 (25,707)––––––––––––– ––––––––––––– –––––––––––––

Cash flows (for)/form financing activitiesLoan repayments in year (29,476) (30,888) (32,240)Interest paid (15,163) (21,179) (66,797)Amount introduced by directors 92,944 85,108 50,000Amount withdrawn by directors (118,532) (179,188) (167,175)

––––––––––––– ––––––––––––– –––––––––––––

Net cash used in financing activities (70,227) (146,147) (216,212)––––––––––––– ––––––––––––– –––––––––––––

Net increase/(decrease) in cash & cash equivalents 40,320 42,708 52,720Cash and equivalent at beginning of period (84,032) (43,712) (1,004)

––––––––––––– ––––––––––––– –––––––––––––

Cash and equivalent at end of period (43,712) (1,004) 51,716––––––––––––– ––––––––––––– –––––––––––––––––––––––––– ––––––––––––– –––––––––––––

34

NOTES TO THE FINANCIAL INFORMATION

1. GENERAL INFORMATIONLureflash is a private company limited by shares and was incorporated on 28 August 1991.

The registered office and principal place of business are as follows:

Registered office: Vulcan Works Chesterton Road, Eastwood Trading Estate, Rotherham,South Yorkshire S65 1SU

Principal place of business: Registered office

Mr S J Gross as director and majority shareholder exercises control over Lureflash.

2. PRINCIPAL ACTIVITIESThe principal activities of the entities of Lureflash are production, wholesaling and retailing of fishingequipment.

3. BASIS OF PREPARATIONThe financial information have been prepared in accordance with IFRS as adopted by the EU issued by theInternational Accounting Standards Board (“IASB”), including related Interpretations issued by theInternational Financial Reporting Interpretations Committee (“IFRIC”).

Lureflash has not applied in advance the following accounting standards and interpretations (including theconsequential amendments, if any) that have been issued by the International Accounting Standards Board(IASB) but are not yet effective for the current financial period:

IFRSs and IC Interpretations (Including The Consequential Amendments) Effective Date

IFRS 9 Financial Instruments 1 January 2018IFRS 14 Regulatory Deferred Accounts 1 January 2016IFRS 15 Revenue from Contracts with Customers 1 January 2017Amendments to IFRS 11: Accounting for Acquisitions of Interests in Joint Operations 1 January 2016IFRS 14 Regulatory Deferral Accounts 1 January 2016Amendments to IAS 16 and IAS 38: Clarification of Acceptable Methods of 1 January 2016Depreciation and AmortisationAmendments to IAS 16 and IAS 41: Agriculture – Bearer Plants 1 January 2016Amendments to IAS 19: Defined Benefit Plans – Employee Contributions 1 July 2014

The directors have reviewed the potential impact of the introduction of the above accounting standards andinterpretations (including the consequential amendments) and consider that they will either be not relevantor immaterial to Lureflash’s operations. In particular, it is considered that IFRS 15 will not have an impactupon a straightforward retail business.

4. SIGNIFICANT ACCOUNTING POLICIES4.1 Critical Accounting Estimates and Judgements

Estimates and judgements are continually evaluated by the directors and management and are basedon historical experience and other factors, including expectations of future events that are believed tobe reasonable under the circumstances. The estimates and judgements that affect the application ofLureflash’s accounting policies and disclosures, and have a significant risk of causing a materialadjustment to the carrying amounts of assets, liabilities, income and expenses are discussed below:

(a) Income taxes and deferred taxesThere are certain transactions and computations for which the ultimate tax determination maybe different from the initial estimate. Lureflash recognises tax liabilities based on its understandingof the prevailing tax laws and estimates of whether such taxes will be due in the ordinary course

35

of business. Where the final outcome of these matters is different from the amounts that wereinitially recognised, such difference will impact the income tax and deferred tax provisions in theyear in which such determination is made. The directors consider at each balance sheet date theextent to which trading losses are recoverable by reference to forecast profitability. Accordinglydeferred tax assets are recognised to the extent that recoverability is reasonably foreseen.

(b) Write-down of inventoriesReviews are made periodically by management on damaged, obsolete and slow-movinginventories. These reviews require judgement and estimates. Possible changes in these estimatescould result in revisions to the valuation of inventories.

(c) Costs of flotationDirectly attributable transaction costs incurred as a result of the expected flotation have beendeferred until the flotation occurs. Following flotation these will be deducted against equity raised(Share premium) or expensed to the income statement as appropriate.

4.2 Functional and Foreign Currencies(a) Functional and presentation currency

The financial information is presented in the currency of the primary economic environment inwhich the entity operates, which is the functional currency.

The financial information is presented in British Sterling (“£”), which is Lureflash’s functionalcurrency and the presentation currency.

(b) Transactions and balancesTransactions in foreign currencies are converted into the respective functional currencies on initialrecognition, using the exchange rates approximating those ruling at the transaction dates.Monetary assets and liabilities at the end of the reporting period are translated at the rates rulingas of that date. Non-monetary assets and liabilities are translated using exchange rates thatexisted when the values were determined. All exchange differences are recognised in profit or loss.

4.3 Financial InstrumentsFinancial instruments are recognised in the statements of financial position when Lureflash has becomea party to the contractual provisions of the instruments.

Financial instruments are classified as liabilities or equity in accordance with the substance of thecontractual arrangement. Interest, dividends, gains and losses relating to a financial instrumentclassified as a liability are reported as an expense or income. Distributions to holders of financialinstruments classified as equity are charged directly to equity.

Financial instruments are offset when Lureflash has a legally enforceable right to offset and intends tosettle either on a net basis or to realise the asset and settle the liability simultaneously.

A financial instrument is recognised initially at its fair value. Transaction costs that are directly attributableto the acquisition or issue of the financial instrument (other than a financial instrument at fair valuethrough profit or loss) are added to/deducted from the fair value on initial recognition, as appropriate.40

Transaction costs on the financial instrument at fair value through profit or loss are recognisedimmediately in profit or loss.

Financial instruments recognised in the statements of financial position are disclosed in the individualpolicy statement associated with each item.

(a) Financial assetsOn initial recognition, financial assets are classified as either financial assets at fair value throughprofit or loss, held-to-maturity investments, loans and receivables financial assets or available for-sale financial assets as appropriate.

36

Loans and receivables financial assets

Trade and other receivables that have fixed or determinable payments and are not quoted in anactive market are classified as loans and receivables financial assets. Loans and receivablesfinancial assets are measured at amortised cost using the effective interest method, less anyimpairment loss. Interest income is recognised by applying the effective interest rate, except forshort-term receivables for which the recognition of interest would be immaterial.

(b) Financial liabilitiesAll financial liabilities are initially measured at fair value plus directly attributable transaction costsand subsequently measured at amortised cost using the effective interest method other thanthose categorised as fair value through profit or loss.

Fair value through profit or loss category comprises financial liabilities that are either held fortrading or are designated to eliminate or significantly reduce a measurement or recognitioninconsistency that would otherwise arise. Derivatives are also classified as held for trading unlessthey are designated as hedges.

(c) Equity instrumentsOrdinary shares are classified as equity. Incremental costs directly attributable to the issue of newordinary shares or options are shown in equity as a deduction, net of tax, from proceeds.

Dividends on ordinary shares are recognised as liabilities when approved for appropriation.

4.4 Property, Plant and Equipment(a) Owned assets

Items of property, plant and equipment are stated at cost less accumulated depreciation and anyaccumulated impairment losses, if any. The cost of an asset comprises its purchase price andany directly attributable costs of bringing the asset to the location and condition for itsintended use.

(b) DepreciationDepreciation is charged to profit or loss (unless it is included in the carrying amount of anotherasset) on the straight-line basis to write off the depreciable amount of the assets net of theestimated residual values over their estimated useful lives. Depreciation of an asset does notcease when the asset becomes idle or is retired from active use unless the asset is fullydepreciated. The principal annual rates used for this purpose are:

Estimateduseful lives

Freehold property 50 yearsPlant and machinery 6.67 yearsFixture and fittings 6.67 yearsMotor vehicles 4 yearsComputer equipment 4 years

The depreciation method, useful lives and residual values are reviewed, and adjustedif appropriate, at the end of each reporting period to ensure that the amounts, method andperiods of depreciation are consistent with previous estimates and the expected pattern ofconsumption of the future economic benefits embodied in the items of the property, plant andequipment.

(c) CostSubsequent costs are included in the asset’s carrying amount or recognised as a separate asset,as appropriate, only when the cost is incurred and it is probable that the future economic benefitsassociated with the asset will flow to Lureflash and the cost of the asset can be measured reliably.The carrying amount of parts that are replaced is derecognised. The costs of the day-to-dayservicing of property, plant and equipment are recognised in profit or loss as incurred. Cost also

37

comprises the initial estimate of dismantling and removing the asset and restoring the site onwhich it is located for which Lureflash is obligated to incur when the asset is acquired, if applicable.

An item of property, plant and equipment is derecognised upon disposal or when no futureeconomic benefits are expected from its use. Any gain or loss arising from derecognition of theasset is recognised in profit or loss. The revaluation reserve included in equity is transferred directlyto retained profits on retirement or disposal of the asset.

4.5 Impairment(a) Impairment of financial assets

All financial assets (other than those categorised at fair value through profit or loss), are assessedat the end of each reporting period whether there is any objective evidence of impairment as aresult of one or more events having an impact on the estimated future cash flows of the asset.

An impairment loss in respect of receivables financial assets is recognised in profit or loss and ismeasured as the difference between the asset’s carrying amount and the present value ofestimated future cash flows, discounted at the financial asset’s original effective interest rate.

If, in a subsequent period, the amount of the impairment loss decreases and the decrease canbe related objectively to an event occurring after the impairment was recognised, the previouslyrecognised impairment loss is reversed through profit or loss to the extent that the carryingamount of the financial asset at the date the impairment is reversed does not exceed what theamortised cost would have been had the impairment not been recognised.

(b) Impairment of non-financial assetsThe carrying values of assets, other than those to which IAS 36 – Impairment of Assets does notapply, are reviewed at the end of each reporting period for impairment when there is an indicationthat the assets might be impaired. Impairment is measured by comparing the carrying valuesof the assets with their recoverable amounts. The recoverable amount of the assets is the higher ofthe assets’ fair value less costs to sell and their value in use, which is measured by reference todiscounted future cash flow.

An impairment loss is recognised immediately and charged to the income statement.

When there is a change in the estimates used to determine the recoverable amount, a subsequentincrease in the recoverable amount of an asset is treated as a reversal of the previous impairmentloss and is recognised to the extent of the carrying amount of the asset that would have beendetermined (net of amortisation and depreciation) had no impairment loss been recognised.The reversal is recognised in profit or loss immediately.

4.6 InventoriesInventories are stated at the lower of cost and net realisable value. Cost is determined on the weightedaverage basis and comprises the purchase price and incidentals incurred in bringing the inventories totheir present location and condition.

Cost of raw materials comprises the original cost of purchase plus costs of bringing the inventories totheir present location and condition.

The cost of finished goods and work in progress include the cost of raw materials, direct labour and aproportion of manufacturing overheads based on normal operating capacity of the manufacturingfacilities.

Net realisable value represents the estimated selling price less the estimated costs necessary to makethe sale.

4.7 Income TaxesIncome tax for the year comprises current and deferred tax.

38

Current tax is the expected amount of income taxes payable in respect of the taxable profit for thereporting period and is measured using the tax rates that have been enacted or substantively enactedat the end of the reporting period, and any adjustment to tax payable in respect of previous financialyears.

Deferred tax is provided in full, using the liability method, on temporary differences arising between thetax bases of assets and liabilities and their carrying amounts in the financial statements.

Deferred tax liabilities are recognised for all taxable temporary differences other than those that arisefrom the initial recognition of an asset or liability in a transaction which is not a business combinationand at the time of the transaction, affects neither accounting profit nor taxable profit.

Deferred tax assets are recognised for all deductible temporary differences, unused tax losses andunused tax credits to the extent that it is probable that future taxable profits will be available againstwhich the deductible temporary differences, unused tax losses and unused tax credits can be utilised.The carrying amounts of deferred tax assets are reviewed at the end of each reporting period andreduced to the extent that it is no longer probable that sufficient future taxable profits will be availableto allow all or part of the deferred tax assets to be utilised.

Deferred tax assets and liabilities are measured at the tax rates that are expected to apply in the periodwhen the asset is realised or the liability is settled, based on the tax rates that have been enacted orsubstantively enacted at the end of the reporting period.

Deferred tax assets and liabilities are offset when there is a legally enforceable right to set off currenttax assets against current tax liabilities and when the deferred income taxes relate to the same taxationauthority.

Deferred tax relating to items recognised outside profit or loss is recognised outside profit or loss.Deferred tax items are recognised in correlation to the underlying transactions either in othercomprehensive income or directly in equity.

4.8 Cash and Cash EquivalentsCash and cash equivalents comprise cash in hand, bank balances, demand deposits, bank overdraftsand short-term, highly liquid investments that are readily convertible to known amounts of cash andwhich are subject to an insignificant risk of changes in value with original maturity periods of threemonths or less.

4.9 Employee BenefitsWages, salaries, paid annual leave and sick leave, bonuses and non-monetary benefits are measuredon an undiscounted basis and are recognised in profit or loss in the period in which the associatedservices are rendered by employees of Lureflash.

4.10 Related PartiesA party is related to an entity (referred to as the ‘reporting entity’) if:

(a) A person or a close member of that person’s family is related to a reporting entity if that person:

(i) has control or joint control over the reporting entity;

(ii) has significant influence over the reporting entity; or

(iii) is a member of the key management personnel of the reporting entity or of a parent of thereporting entity.

(b) An entity is related to a reporting entity if any of the following conditions applies:

(i) The entity and the reporting entity are members of the same group (which means that eachparent, subsidiary and fellow subsidiary is related to the others).

(ii) One entity is an associate or joint venture of the other entity (or an associate or joint ventureof a member of a group of which the other entity is a member).

(iii) Both entities are joint ventures of the same third party.

39

(iv) One entity is a joint venture of a third entity and the other entity is an associate of the thirdentity.

(v) The entity is a post-employment benefit plan for the benefit of employees of either thereporting entity or an entity related to the reporting entity. If the reporting entity is itself sucha plan, the sponsoring employers are also related to the reporting entity.

(vi) The entity is controlled or jointly controlled by a person identified in (a) above.

(vii) A person identified in (a)(i) above has significant influence over the entity or is a member ofthe key management personnel of the entity (or of a parent of the entity).

Close members of the family of a person are those family members who may be expected to influence,or be influenced by, that person in their dealings with the entity.

4.11 Revenue and Other Income(a) Sale of goods

Revenue from the sale of goods is measured at fair value of consideration received or receivables,net of returns and trade discounts where applicable. Revenue is recognised upon delivery ofgoods when the significant risks and rewards of ownership have been transferred to the buyer,recovery of the consideration is probable, the associated costs and possible return of goods canbe estimated reliably.

(b) Other incomeInterest and rental income are recognised on an accrual basis, based upon amounts receivablefor the financial period. Interest income is recognised using the effective interest method.

4.12 GoodwillGoodwill represents the excess of the consideration paid for an acquired business over the net assetsacquired. Goodwill is subject to annual impairment review in accordance with 4.5(b) above.

4.13 Operating SegmentsAn operating segment is a component that engages in distinct business activities from which it earnsrevenues and incurs expenses, including revenues and expenses relating to transactions

with other business components. Lureflash operates with seven retail branches in it’s geographicalregion and, to some extent, available branch operating results are reviewed regularly by the chiefoperating decision makers, however it is considered that these are retail outlets, not distinct segmentsand there is effectively one single operating business segment being that of retail of fishing tackle andequipment.

5. PROPERTY, PLANT AND EQUIPMENTAs at As at

1 January 31 December2012 Additions Disposals Depreciation 2012

£ £ £ £ £Net Book ValueFreehold property 118,727 – – 3,211 115,516Computer equipment 260 270 – 530 –Fixtures and fittings 41,468 – – 24,209 17,259Plant and machinery 1,214 – – 1,015 199Motor vehicles 1,074 – – 1,074 –

––––––––––––– ––––––––––––– ––––––––––––– ––––––––––––– –––––––––––––

162,743 270 – 30,039 132,974––––––––––––– ––––––––––––– ––––––––––––– ––––––––––––– –––––––––––––––––––––––––– ––––––––––––– ––––––––––––– ––––––––––––– –––––––––––––

40

As at As at1 January 31 December

2013 Additions Disposals Depreciation 2013£ £ £ £ £

Net Book ValueFreehold property 115,516 – 409 3,212 111,895Fixtures and fittings 17,259 – 1,437 11,773 4,049Plant and machinery 199 – – 199 –

––––––––––––– ––––––––––––– ––––––––––––– ––––––––––––– –––––––––––––

132,974 – 1,846 15,184 115,944––––––––––––– ––––––––––––– ––––––––––––– ––––––––––––– –––––––––––––––––––––––––– ––––––––––––– ––––––––––––– ––––––––––––– –––––––––––––

As at As at1 January 31 December

2014 Additions Disposals Depreciation 2014£ £ £ £ £

Net Book ValueFreehold property 111,895 – – 3,201 108,694Computer equipment – 892 – 49 843Fixtures and fittings 4,049 11,152 – 5,164 10,037Plant and machinery – 13,830 – 763 13,067

––––––––––––– ––––––––––––– ––––––––––––– ––––––––––––– –––––––––––––

115,944 25,874 – 9,177 132,641––––––––––––– ––––––––––––– ––––––––––––– ––––––––––––– –––––––––––––––––––––––––– ––––––––––––– ––––––––––––– ––––––––––––– –––––––––––––

Accumulated Net bookCost depreciation value

£ £ £As at 31 December 2012Freehold property 161,280 45,764 115,516Short leasehold 19,595 19,595 –Computer equipment 96,130 96,130 –Fixture and fittings 444,879 427,620 17,259Plant and machinery 48,652 48,453 199Motor vehicles 60,036 60,036 –

––––––––––––– ––––––––––––– –––––––––––––

830,572 697,598 132,974––––––––––––– ––––––––––––– –––––––––––––––––––––––––– ––––––––––––– –––––––––––––

As at 31 December 2013Freehold property 160,790 48,895 111,895Short leasehold 14,774 14,774 –Computer equipment 59,499 59,499 –Fixture and fittings 361,446 357,397 4,049Plant and machinery 34,403 34,403 –Motor vehicles 10,762 10,762 –

––––––––––––– ––––––––––––– –––––––––––––

641,674 525,730 115,944––––––––––––– ––––––––––––– –––––––––––––––––––––––––– ––––––––––––– –––––––––––––

As at 31 December 2014Freehold property 160,790 52,096 108,694Short leasehold 14,774 14,774 –Computer equipment 60,391 59,548 843Fixture and fittings 372,598 362,561 10,037Plant and machinery 48,233 35,166 13,067Motor vehicles 10,762 10,762 –

––––––––––––– ––––––––––––– –––––––––––––

667,548 534,907 132,641––––––––––––– ––––––––––––– –––––––––––––––––––––––––– ––––––––––––– –––––––––––––

(a) All property, plant and equipment held by Lureflash are located in the UK.

(b) The following property, plant and equipment have been pledged to licensed banks as security forbanking facilities granted to Lureflash as disclosed in Note 14 to the financial information:

41

As at 31 December2012 2013 2014

£ £ £At carrying amount:Freehold property 115,516 111,895 108,694

––––––––––––– ––––––––––––– –––––––––––––––––––––––––– ––––––––––––– –––––––––––––

6. GOODWILL2012 2013 2014

£ £ £Price paid in connection with a business in 2006Net book value 15,937 14,687 13,437

––––––––––––– ––––––––––––– –––––––––––––––––––––––––– ––––––––––––– –––––––––––––

The reduction in carrying value each year related to annual impairment. Detailed movements are not shownas the directors consider that the amounts are not material. The amounts written off in each financial yearwere: 2014, £1,250; 2013, £1,250; 2012,£1,250).

7. DEFERRED TAX ASSET2012 2013 2014

£ £ £The following deferred tax asset has been recognised in respect of trading losses 212,999 135,682 77,919

––––––––––––– ––––––––––––– –––––––––––––––––––––––––– ––––––––––––– –––––––––––––

Non-current assets 137,999 90,682 22,919Current assets 75,000 45,000 55,000

––––––––––––– ––––––––––––– –––––––––––––––––––––––––– ––––––––––––– –––––––––––––

The applicable tax rate is the small companies rate of 20 per cent. The directors have assessed therecoverability of losses at each balance sheet date by reference to projected taxable profit.

8. INVENTORIESAs at 31 December

2012 2013 2014£ £ £

At cost:Inventory 1,949,178 2,156,572 1,908,666

––––––––––––– ––––––––––––– –––––––––––––

1,949,178 2,156,572 1,908,666––––––––––––– ––––––––––––– –––––––––––––––––––––––––– ––––––––––––– –––––––––––––

9. TRADE AND OTHER RECEIVABLESLureflash’s normal trade credit terms range up to 60 days. Other credit terms are assessed and approvedon a case-by-case basis.

Directly attributable transaction costs incurred as a result of the expected flotation have been deferred untilthe flotation occurs. Following flotation these will be deducted against equity raised (Share premium) orexpensed to the income statement as appropriate.

42

As at 31 December2012 2013 2014

£ £ £

Trade receivables 66,290 13,537 9,429Other receivables – 2,996 47,978Prepayments – floatation costs – – 126,261Prepayments – other 35,012 29,509 29,845

––––––––––––– ––––––––––––– –––––––––––––

101,302 46,042 213,513––––––––––––– ––––––––––––– –––––––––––––––––––––––––– ––––––––––––– –––––––––––––

10. CASH AND BANK BALANCESAs at 31 December

2012 2013 2014£ £ £

Cash in hand 7,106 6,090 6,189Bank accounts 45,527

––––––––––––– ––––––––––––– –––––––––––––

Cash and bank balances 7,106 6,090 51,716––––––––––––– ––––––––––––– –––––––––––––

Cash and cash equivalents 7,106 6,090 51,716––––––––––––– ––––––––––––– –––––––––––––––––––––––––– ––––––––––––– –––––––––––––

11. SHARE CAPITALThe movements in the registered capital of Lureflash are as follows:

As at 31 December2012 2013 2014

£ £ £Fully Paid-UpAt 1 January 1,375,000 1,375,000 1,375,000

––––––––––––– ––––––––––––– –––––––––––––

31 December 2012,2013, 2014 1,375,000 1,375,000 1,375,000––––––––––––– ––––––––––––– –––––––––––––––––––––––––– ––––––––––––– –––––––––––––

The shares in issue at 31 December 2012 and 2013 were as follows:

Allotted, issued and fully paid: Nominal Number: Class: value: £

25,000 Ordinary £1 25,000500,000 A Ordinary 10p 50,0001,600,000 B Ordinary 10p 160,0002,475,000 C Ordinary 10p 247,5008,925,000 D Ordinary 10p 892,500

–––––––––––––

1,375,000––––––––––––––––––––––––––

The shares in issue at 31 December 2014 were as follows:

Allotted, issued and fully paid: Nominal Number: Class: value: £

1,375,000 Ordinary shares £1 1,375,0001,375,000

All classes of share ranked pari passu and carried equal voting and dividend rights.

43

During the year, 500,000 A ordinary shares of 10p; 1,600,000 B ordinary shares of 10p; 2,475,000 C ordinaryshares of 10p; and 8,925,000 D ordinary shares of 10p were re-designated as ordinary shares andconsolidated into shares of £1 to create an issued share capital of the company of 1,375,000 ordinary sharesof £1 (when aggregated with the ordinary shares of £1 each already in issue).

12. RESERVESAs at 31 December

2012 2013 2014£ £ £

Accumulated losses (644,560) (357,427) (120,674)––––––––––––– ––––––––––––– –––––––––––––––––––––––––– ––––––––––––– –––––––––––––

13. TRADE AND OTHER PAYABLESThe normal trade credit terms granted to Lureflash range from 7 to 30 days.

As at 31 December2012 2013 2014

£ £ £

Trade payables 628,324 534,057 491,854Social security and other taxes 6,854 17,517 9,824Accruals 4,964 19,949 24,748VAT 51,196 132,659 186,594Other payables 286,067 210,305 44,098

––––––––––––– ––––––––––––– –––––––––––––

977,405 914,487 757,118––––––––––––– ––––––––––––– –––––––––––––––––––––––––– ––––––––––––– –––––––––––––

14. BANK LOANS AND OVERDRAFTLureflash’s interest-bearing bank borrowings are secured by a first legal charge on freehold property atKilnhurst, Rotherham, a debenture representing a charge over the company’s assets and a personalguarantee from S Gross, director and controlling shareholder, limited to £375,000, also, supported by alegal charge over freehold property in Sunderland (owned personally by Mr Gross).

15. REVENUERevenue represents the net invoiced value of goods sold, after allowances for returns and trade discounts.

16. OTHER INCOMEYears ended 31 December

2012 2013 2014£ £ £

Rent 8,000 4,970 7,560Sundry income 2,285 – 2,000

––––––––––––– ––––––––––––– –––––––––––––

10,285 4,970 9,560––––––––––––– ––––––––––––– –––––––––––––––––––––––––– ––––––––––––– –––––––––––––

44

17. PROFIT BEFORE TAXATIONYears ended 31 December

2012 2013 2014£ £ £

Profit before taxation is arrived at after charging:Audit fee – 22,000 8,000Depreciation of property, plant andEquipment 30,039 15,184 9,177Key management personnel – Directors’ remuneration 10,952 10,952 10,995Interest expense 15,163 21,179 66,797(Profit)/loss on disposal of plant and equipment – (4,754) (167)Staff costs:– salaries and other benefits 513,254 483,627 491,394– social security costs 32,541 29,547 34,966

––––––––––––– ––––––––––––– –––––––––––––––––––––––––– ––––––––––––– –––––––––––––

18. INCOME TAX EXPENSEYears ended 31 December

2012 2013 2014£ £ £

Deferred tax charge;reversal of timing differences 50,061 77,317 57,763

––––––––––––– ––––––––––––– –––––––––––––––––––––––––– ––––––––––––– –––––––––––––

The current tax charge was Nil for each of the three years ended 31 December 2014 due to the availabilityof trading losses.

A reconciliation of income tax expense applicable to the profit before taxation at the statutory tax rate toincome tax expense at the effective tax rate is as follows:

Years ended 31 December2012 2013 2014

£ £ £

Profit before taxation 279,965 364,450 294,516––––––––––––– ––––––––––––– –––––––––––––––––––––––––– ––––––––––––– –––––––––––––

Tax at the applicable tax rate of 20% 55,993 72,890 58,903Tax effects of:Non-deductible expenses 7,859 4,471 11,738Non-taxable income (4,909) (3,837) (8,635)Losses utilised (58,943) (73,524) (62,006)

––––––––––––– ––––––––––––– –––––––––––––

– – –––––––––––––– ––––––––––––– –––––––––––––––––––––––––– ––––––––––––– –––––––––––––

19. FINANCE COSTSYears ended 31 December

2012 2013 2014£ £ £

Bank loan interest 15,163 15,253 12,403Other loan interest – – 3,701Other interest and finance costs – 5,926 50,693

––––––––––––– ––––––––––––– –––––––––––––

15,163 21,179 66,797––––––––––––– ––––––––––––– –––––––––––––––––––––––––– ––––––––––––– –––––––––––––

45

20. RELATED PARTY DISCLOSURES

(a) Identification of related partiesLureflash has related party relationships with its directors and shareholders, key management personneland entities in which a director, SJ Gross, has a controlling financial interest.

(b) Related party disclosuresThe financial statements included the following transactions and balances with related parties;

For the year ended31 December 31 December 31 December

2012 2013 2014£ £ £

Klobba Limited, a company controlled by SJ Gross;Sales 196,402 205,426 51,516Purchases 109,275Other payables 125,815 85,131

AK Construction (South Yorkshire) Limited, a company controlled by SJ Gross;Sales (employee costs re-charged) 67,254Other operating expenses 91Other receivables 2,996 2,996Trade payables 91Other payables 86,033

Dearne Valley Property Limited, a company controlled by SJ Gross;Sales (employee costs re-charged) 3,000Other payables 73,658 46,698 43,098

Wickham Homes (Northern) Limited, a company controlled by SJ Gross;Other receivables 396

Diamond Homes (Northern) Limited, a company controlled by SJ Gross;Sales (employee costs re-charged) 18,500

Current liabilities included the following amounts owed to directors;SJ Gross 271,949 177,869 60,694JH Gross 50,000 50,000 50,000

These balances have no fixed repayment terms and are therefore classified as repayable on demand.No interest is charged.

Directors’ remuneration is disclosed in note 17 and relates entirely to salaried remuneration. During 2013SJ Gross acquired a vehicle from the company at a market value of £5,000.

The seven branch properties from which the company operates its business are owned by SJ and Z Gross.No rents have been charged for use of the premises during the three years ended 31 December 2014.

21. OPERATING SEGMENTSLureflash operates seven branches, all conducting the same business (retail fishing tackle stores) and in onegeographical region, Yorkshire and Teeside. As resources are spread across these outlets and performancemeasured overall there is considered to be one single operating segment.

All of the Company’s revenue is derived from UK customers.

46

22. FINANCIAL INSTRUMENTSLureflash’s activities are exposed to a variety of market risk (including foreign currency risk, interest rate riskand equity price risk), credit risk and liquidity risk. Lureflash’s overall financial risk management policy focuseson the unpredictability of financial markets and seeks to minimise potential adverse effects on Lureflash’sfinancial performance.

There were no financial assets or liabilities classified either as ‘held to maturity’ or as ‘fair value’ through theprofit and loss during the year.

22.1 Financial Risk Management PoliciesLureflash’s policies in respect of the major areas of treasury activity are as follows:

(a) Market Risk(i) Foreign Currency Risk

Lureflash is not exposed to foreign currency risk on transactions and no balances aredenominated in currencies other than GBP Sterling.

(ii) Interest Rate Risk

Interest rate risk is the risk that the fair value or future cash flows of a financial instrumentwill fluctuate because of changes in market interest rates. Lureflash exposure to interestrate risk arises mainly from interest-bearing financial liabilities. Lureflash’s policy is to obtainthe most favourable interest rates available.

Interest rate risk sensitivity analysis

The following table details the sensitivity analysis to a reasonably possible change in theinterest rates at the end of the reporting periods, with all other variables held constant:

As at 31 December2012 2013 2014

Increase/ Increase/ Increase/(Decrease) (Decrease) (Decrease)

£ £ £Effects on profit after tax and equityIncrease of 100 basis points (bp) 3,829 3,073 2,666Decrease of 100bp (3,753) (3,045) (2,641)

––––––––––––– ––––––––––––– –––––––––––––––––––––––––– ––––––––––––– –––––––––––––

(iii) Equity Price Risk

Lureflash does not have any quoted investments and hence is not exposed to equity pricerisk.

(b) Credit RiskLureflash’s exposure to credit risk, or the risk of counterparties defaulting, arises mainly from tradeand other receivables. Lureflash manages its exposure to credit risk by the application of creditapprovals, credit limits and monitoring procedures on an ongoing basis. For other financial assets(including cash and bank balances), Lureflash minimises credit risk by dealing exclusively withhigh credit rating counterparties.

Lureflash establishes an allowance for impairment that represents its estimate of incurred lossesin respect of the trade and other receivables as appropriate. The main components of thisallowance are a specific loss component that relates to individually significant exposures, and acollective loss component established for Lureflash of similar assets in respect of losses that havebeen incurred but not yet identified. Impairment is estimated by management based on priorexperience and the current economic environment.

47

(i) Credit risk concentration profile

At the year end no allowance was required.

Lureflash does not have any major concentration of credit risk related to any individualcustomer or counterparty.

(ii) Exposure to credit risk

As Lureflash does not hold any collateral, the maximum exposure to credit risk is representedby the carrying amount of the financial assets at the end of the reporting periods. All of theseexpenses are to UK entities.

(iii) Ageing analysis

The ageing analysis of Lureflash’s trade receivables at the end of the reporting periods is asfollows:

As at 31 December2012 2013 2014

£ £ £

Not past due and not impaired 13,375 1,610 489Past due but not impaired:– 2 to 4 months 4,617 1,699 976– over 4 months 48,298 10,228 7,964

––––––––––––– ––––––––––––– –––––––––––––

66,290 13,537 9,429––––––––––––– ––––––––––––– –––––––––––––––––––––––––– ––––––––––––– –––––––––––––

(iv) Trade receivables that are past due but not impaired

Lureflash believes that no impairment allowance is necessary in respect of these tradereceivables. They are substantially companies with good collection track record and norecent history of default.

(v) Trade receivables that are neither past due nor impaired

A significant portion of trade receivables that are neither past due nor impaired are regularcustomers that have been transacting with Lureflash. Lureflash uses ageing analysis tomonitor the credit quality of the trade receivables. Any receivables having significant balancespast due or more than 180 days, which are deemed to have higher credit risk, are monitoredindividually.

(c) Liquidity RiskLiquidity risk arises mainly from general funding and business activities. Lureflash practisesprudent risk management by maintaining sufficient cash balances and the availability of fundingthrough certain committed credit facilities.

48

The following table sets out the maturity profile of the financial liabilities as at the end of thereporting periods based on contractual undiscounted cash flows (including interest paymentscomputed using contractual rates or, if floating, based on the rates at the end of the reportingperiods):

Weightedaverage Contractualeffective Carrying Undiscounted Within 1 – 5 Over 5

rate amount cash flows 1 Year Years Years% £ £ £ £ £

As at 31 December 2012Trade payables – 628,324 628,324 628,324 – –Other payables andaccruals – 671,030 671,309 671,309 – –Interest-bearing bankborrowings 3.81 389,702 451,921 94,423 175,537 181,961

––––––––––– ––––––––––– ––––––––––– ––––––––––– –––––––––––

Total financialliabilities 1,689,056 1,751,554 1,394,056 175,537 181,961

––––––––––– ––––––––––– ––––––––––– ––––––––––– –––––––––––––––––––––– ––––––––––– ––––––––––– ––––––––––– –––––––––––

Weightedaverage Contractualeffective Carrying undiscounted Within 1 – 5 Over 5

rate amount cash flows 1 Year Years Years% £ £ £ £ £

As at 31 December 2013Trade payables – 534,057 534,057 534,057 – –Other payables andaccruals – 608,299 608,299 608,299 – –Interest-bearing bankborrowings 3.76 315,088 365,184 50,976 175,542 138,666

––––––––––– ––––––––––– ––––––––––– ––––––––––– –––––––––––Total financialliabilities 1,457,444 1,507,540 1,193,332 175,542 138,666

––––––––––– ––––––––––– ––––––––––– ––––––––––– –––––––––––––––––––––– ––––––––––– ––––––––––– ––––––––––– –––––––––––

Weightedaverage Contractualeffective Carrying undiscounted Within 1 – 5 Over 5

rate amount cash flows 1 Year Years Years% £ £ £ £ £

As at 31 December 2014Trade payables – 491,854 491,854 491,854 – –Other payables andaccruals – 375,958 375,958 375,958 – –Interest-bearing bankborrowings 3.76 275,754 319,596 50,976 175,542 93,078

––––––––––– ––––––––––– ––––––––––– ––––––––––– –––––––––––

Total financialliabilities 1,143,566 1,187,408 918,788 175,542 93,078

––––––––––– ––––––––––– ––––––––––– ––––––––––– –––––––––––––––––––––– ––––––––––– ––––––––––– ––––––––––– –––––––––––

49

22.2 Capital Risk ManagementLureflash manages its capital to ensure that entities within Lureflash will be able to maintain an optimalcapital structure so as to support their businesses and maximise shareholders’ value. To achieve thisobjective, Lureflash may make adjustments to the capital structure in view of changes in economicconditions, such as adjusting the amount of dividend payment, returning of capital to shareholders orissuing new shares.

Lureflash manages its capital based on debt-to-equity ratio that complies with debt covenants andregulatory, if any. The debt-to-equity ratio is calculated as total borrowings from financial institutionsdivided by total equity.

There was no change in Lureflash’s approach to capital management during the financial period underreview.

The debt-to-equity ratio of Lureflash at the end of the financial year is not presented as its cash andcash equivalents exceeded the total debts.

22.3 Classification of Financial InstrumentsAs at 31 December

2012 2013 2014£ £ £

Financial AssetTrade receivables 66,290 13,537 9,429Cash and bank balances 7,106 6,090 51,716

––––––––––––– ––––––––––––– –––––––––––––

73,396 19,627 61,145––––––––––––– ––––––––––––– –––––––––––––––––––––––––– ––––––––––––– –––––––––––––

Financial LiabilityTrade payables 628,324 534,057 491,854Other payables and accruals 671,309 608,299 375,958Interest-bearing bank borrowings 389,423 315,085 275,754

––––––––––––– ––––––––––––– –––––––––––––

1,689,056 1,457,441 1,143,566––––––––––––– ––––––––––––– –––––––––––––––––––––––––– ––––––––––––– –––––––––––––

22.4 Fair Values MeasurementsAt 31 December 2012, 2013, 2014 there were no financial instruments carried at fair values. The fairvalues of the financial assets and financial liabilities approximated their carrying amounts due to therelatively short-term maturity of the financial instruments (maturity within the next 12 months). The fairvalues are determined by discounting the relevant cash flows at rates equal to the current marketinterest rate plus appropriate credit rating, where necessary. The fair values are included in level 2 ofthe fair value hierarchy.

23. SUBSEQUENT EVENTSOn 20 May 2015 the entire issued share capital of Lureflash was acquired by Fishing Republic Limited.

24. ULTIMATE PARENT COMPANYAt the date of this report the ultimate controlling party of Lureflash is considered to be Fishing RepublicLimited, which is incorporated in the United Kingdom.

25. NATURE OF FINANCIAL INFORMATIONThe financial information presented above does not constitute statutory financial statements for the periodunder review.

50

PART III (B)

ACCOUNTANTS’ REPORT ON THE COMPANY

29 May 2015

The DirectorsFishing Republic PlcVulcan Works Chesterton RoadEastwood Trading EstateRotherhamSouth Yorkshire S65 1SU

The DirectorsNorthland Capital Partners Limited131 Finsbury PavementLondon EC2A 1NT

Dear Sirs

IntroductionThis financial information has been prepared for inclusion in Part III(B) of the AIM Admission Document dated29 May 2015 of Fishing Republic Plc (the “Company”) (the “Admission Document”), on the basis of theaccounting policies set out in Note 2 to the financial information. This report is required by Paragraph (a) ofSchedule Two to the AIM Rules for Companies (the “AIM Rules”) and is given for the purposes of complyingwith the AIM Rules and for no other purpose.

1. Responsibilities The Directors are responsible for preparing the financial information on the basis of preparation set out inNote 2 below and in accordance with International Financial Reporting Standards as adopted by theEuropean Union (“IFRS”).

It is our responsibility to form an opinion on the financial information as to whether the financial informationgives a true and fair view, for the purposes of the Admission Document and to report our opinion to you.

Save for any responsibility arising under Paragraph (a) of Schedule Two of the AIM Rules to any person asand to the extent there provided, to the fullest extent permitted by law we do not assume any responsibilityand will not accept any liability to any person other than the addressees of this letter for any loss sufferedby any such person as a result of, arising out of, or in connection with this report or our statement, requiredby and given solely for the purposes of complying with Paragraph (a) of Schedule Two of the AIM Rules,consenting to its inclusion in the Admission Document.

Crowe Clark Whitehill LLP

Chartered Accountants

Member of Crowe Horwath International

St Bride’s House, 10 Salisbury Square

London EC4Y 8EH, UK

Tel: +44 (0)20 7842 7100

Fax: +44 (0)20 7583 1720

DX: 0014 London Chancery Lane

www.croweclarkwhitehill.co.uk

51

2. Basis of OpinionWe conducted our work in accordance with Standards of Investment Reporting issued by the AuditingPractices Board in the United Kingdom. Our work included an assessment of evidence relevant to theamounts and disclosures in the financial information. It also included an assessment of significant estimatesand judgments made by those responsible for the preparation of the underlying financial information andwhether the accounting policies are appropriate to the entity’s circumstances, consistently applied andadequately disclosed.

We planned and performed our work so as to obtain all the information and explanations which weconsidered necessary in order to provide us with sufficient evidence to give reasonable assurance that thefinancial information is free from material misstatement, whether caused by fraud or other irregularity or error.

3. OpinionIn our opinion, the financial information gives, for the purposes of the Admission Document, a true and fairview of the state of affairs of the Company as at the date stated and of the results, cash flows and changesin equity for the period then ended in accordance with the basis of preparation set out in Note 2 to thefinancial information and has been prepared in accordance with IFRS and has been prepared in a form thatis consistent with the accounting policies adopted by the Company.

4. DeclarationFor the purposes of Paragraph (a) of Schedule Two of the AIM Rules, we are responsible for this report aspart of the Admission Document and declare that we have taken all reasonable care to ensure that theinformation contained in this report is, to the best of our knowledge, in accordance with the facts andcontains no omission likely to affect its import. This declaration is included in the Admission Document incompliance with Paragraph (a) of Schedule Two of the AIM Rules.

Yours faithfully

Crowe Clark Whitehill LLP

52

STATEMENT OF FINANCIAL POSITIONThe statement of financial position of the Company as at 31 December 2014 is stated below:

£AssetsCurrent assets Trade and other receivables 100Cash –

–––––––––––––

Total assets 100––––––––––––––––––––––––––

Equity and liabilitiesCapital and reserves –Share capital 100

–––––––––––––

Total equity attributable to equity holders 100Total liabilities –

–––––––––––––

Total equity and liabilities 100––––––––––––––––––––––––––

53

STATEMENT OF COMPREHENSIVE INCOMEThe statement of comprehensive income of the Company for the period from incorporation on 30 August2014 to 31 December 2014 is stated below:

£

Total comprehensive income attributable to equity owner –––––––––––––––––––––––––––

STATEMENT OF CHANGES IN EQUITY The statement of changes in equity of the Company for period from incorporation on 30 August 2014 to31 December 2014 is set out below:

Share capital£

On incorporation 100Result for the period –

–––––––––––––

As at 31 December 2014 100––––––––––––––––––––––––––

The share capital comprises the ordinary issued share capital of the Company.

54

STATEMENT OF CASH FLOWSThe statement of cash flows of the Company for the period from incorporation on 30 August 2014 to31 December 2014 is as follows:

£Financing activities Proceeds from issue of share capital 1Net cash from financing activities –

–––––––––––––

Net increase in cash and cash equivalents 1Cash and cash equivalents at end of period 1

––––––––––––––––––––––––––

55

NOTES TO THE FINANCIAL INFORMATION

1. General Information The Company was incorporated in England and Wales, on 30 August 2014 as a private limited company.The registered office of the Company is Vulcan Works, Chesterton Road, Eastwood Trading Estate,Rotherham, South Yorkshire S65 1SU. Pursuant to a special resolution passed on 20 May 2015, on21 May 2015 the Company was re-registered in England and Wales as a public company limited by sharesunder the Act with the name “Fishing Republic plc”

The Company did not trade during the period under review. The Company’s nature of operations is to actas the holding company of for Lureflash International Limited, a company involved in the wholesale and retailof fishing tackle in the UK.

2. Accounting Policies

Basis of preparationThis financial information of the Company has been prepared on a historical basis as varied by the use offair value in accordance with IFRS, International Accounting Standards (IASs) and International FinancialReporting Interpretations Committee (IFRIC) interpretations as adopted by the European Union.

The financial information of the Company is presented in Great British Pounds (“GBP”).

Standards and interpretations issued but not yet appliedAt the date of authorisation of this financial information, the Directors have received the Standards in issueby the International Accounting Standards Board (“IASB”) and IFRIC, which are effective for annualaccounting periods ending on or after the stated effective date. In their view, none of these standards wouldhave a material impact on the financial reporting of the company.

Comparative figuresNo comparative figures have been presented as the financial information covers the period from incorporationon 30 August 2014 to 31 December 2014.

Cash and cash equivalentsThe Company considers any cash on short-term deposits and other short term investments to be cashequivalents.

3. Share capitalOn 30 August 2014, the Company was incorporated and had issued share capital of 100 ordinary sharesof £1.

4. Subsequent eventsOn 20 May 2015 the entire issued share capital of Lureflash was acquired by the Company.

5. Nature of financial InformationThe financial information presented above does not constitute statutory accounts for the period under review.

56

PART III (C)

UNAUDITED PRO FORMA STATEMENT OF AGGREGATED NET ASSETS

29 May 2015

The DirectorsFishing Republic PlcVulcan WorksChesterton RoadEastwood Trading EstateRotherhamSouth Yorkshire S65 1SU

The DirectorsNorthland Capital Partners Limited131 Finsbury PavementLondon EC2A 1NT

Dear Sirs

IntroductionWe report on the unaudited pro forma financial information of Fishing Republic Plc (the “Company”) and itssubsidiaries (together, the “Group”) set out in Parts A and B of this Part III of the AIM Admission Document(the “Document”) dated 29 May 2015, which has been prepared on the basis described, for illustrativepurposes only, to provide information about how the Placing and Admission might have affected the netassets presented on the basis of the accounting policies adopted by the Company in preparing the auditedfinancial information for the period ended 31 December 2014 for Lureflash International Limited and 31December 2014 for the Company. This report is required by Schedule Two of the AIM Rules and is given forthe purpose of complying with that scheduled and for no other purpose.

ResponsibilitiesIt is the responsibility of the Directors of the Company to prepare the unaudited pro forma financial informationin accordance with Schedule Two of the AIM Rules.

It is our responsibility to form an opinion, in accordance with Schedule Two of the AIM Rules, as to theproper compilation of the Pro Forma Financial Information and to report that opinion to you.

In providing this opinion we are not updating or refreshing any reports or opinions previously made by us onany financial information used in the compilation of the Pro Forma Financial Information, nor do we acceptresponsibility for such reports or opinions beyond that owed to those to whom those reports or opinionswere addressed by us at the dates of their issue.

Crowe Clark Whitehill LLP

Chartered Accountants

Member of Crowe Horwath International

St Bride’s House, 10 Salisbury Square

London EC4Y 8EH, UK

Tel: +44 (0)20 7842 7100

Fax: +44 (0)20 7583 1720

DX: 0014 London Chancery Lane

www.croweclarkwhitehill.co.uk

57

Basis of opinionWe conducted our work in accordance with Standards of Investment Reporting issued by the AuditingPractices Board in the United Kingdom. The work that we performed for the purpose of making this report,which involved no independent examination of any of the underlying financial information, consisted primarilyof comparing the unadjusted financial information with the source documents, considering the evidencesupporting the adjustments and discussing the Pro Forma Financial Information with the Directors.

We planned and performed our work so as to obtain all the information and explanations which weconsidered necessary in order to provide us with reasonable assurance that the Pro Forma FinancialInformation has been properly compiled on the basis stated and that such basis is consistent with theaccounting policies of the Company.

Our work has not been carried out in accordance with auditing or other standards and practices generallyaccepted in jurisdictions outside the United Kingdom and accordingly should not be relied upon as if it hadbeen carried out in accordance with those standards and practices.

OpinionIn our opinion:

(a) the Pro Forma Financial Information has been properly complied on the basis stated; and

(b) such basis is consistent with the accounting policies of the Company.

DeclarationFor the purpose of Paragraph (a) of Schedule Two of the AIM Rules, we are responsible for this report aspart of the Document and declare that we have taken all reasonable care to ensure that the informationcontained in this report is, to the best of our knowledge, in accordance with the facts and contains noomission likely to affect its import. This declaration is included in the Document in compliance with ScheduleTwo of the AIM Rules.

Yours faithfully

Crowe Clark Whitehill LLP

58

Set out below is an unaudited pro forma statement of aggregated net assets of the Group, which has beenprepared on the basis of the Company’s audited financial information for the period ended 31 December2014 and the audited pro forma aggregated financial information of Lureflash International Limited for thefinancial year ended 31 December 2014, as adjusted for the Placing proceeds, as set out in the notes below.The unaudited pro forma statement has been prepared for illustrative purposes only and, because of itsnature, will not represent the actual consolidated financial position of the Company at the date of Admission.

Unaudited pro forma statement of aggregated net assetsUnaudited

Lureflash Pro formaThe International Placing net assets of

Company Limited adjustments the GroupNotes 1 2 3 4

31 December 31 December2014 2014

£ £ £ £Audited Audited Unaudited

Non-current assetProperty Plant & Equipment – 132,641 – 132,641Goodwill – 13,437 – 13,437Deferred tax assets – 22,919 – 22,919

––––––––––– ––––––––––– ––––––––––– –––––––––––

– 168,997 – 168,997––––––––––– ––––––––––– ––––––––––– –––––––––––

Current assetsInventories – 1,908,666 – 1,908,666Trade and other receivables 100 213,513 – 213,613Deferred tax asset – 55,000 – 55,000Cash and bank balance – 51,716 1,050,000 1,101,716

––––––––––– ––––––––––– ––––––––––– –––––––––––

100 2,228,895 1,050,000 3,278,995––––––––––– ––––––––––– ––––––––––– –––––––––––

Total assets 100 2,397,892 1,050,000 2,447,992––––––––––– ––––––––––– ––––––––––– –––––––––––

Current liabilitiesTrade payables – 491,854 – 491,854Other payables and accruals – 265,264 – 265,264Non-interesting bearing loans from directors – 110,694 – 11,694Interesting bearing loans and borrowings – 34,500 – 34,500

––––––––––– ––––––––––– ––––––––––– –––––––––––

– 902,312 – 902,312––––––––––– ––––––––––– ––––––––––– –––––––––––

Net assets 100 1,495,580 1,050,000 2,545,689––––––––––– ––––––––––– ––––––––––– –––––––––––––––––––––– ––––––––––– ––––––––––– –––––––––––

Notes:

1. The statement of financial position of the Company as at 31 December 2014 has been extracted without further adjustmentsfrom the Company’s financial information set out in Part B of the Document. No account has been taken of the activities of theCompany subsequent to 31 December 2014.

2. The statement of financial position of Lureflash as at 31 December 2014 has been extracted without adjustment from the auditedfinancial information set out in Part A of the Document. No account has been taken of the activities of Lureflash subsequent to31 December 2014.

3. The Company raised £1.5 million (gross) from the Placing. Associated costs of the Placing were approximately £0.45 million.

4. The Directors consider that the substance of the acquisition of Lureflash by the Company is that of a reverse acquisition and that,in order to give a true and fair view, the reverse acquisition accounting method, as permitted by IFRS 3 “Business combinations”,will be adopted as the basis of consolidation in the first published accounts of the Company following completion of the acquisition.Any goodwill arising under reverse acquisition accounting will be accounted for within the Income Statement on consolidation.

59

PART IV

ADDITIONAL INFORMATION

1. Incorporation and status of the Company

1.1 The Company was incorporated and registered in England and Wales on 30 August 2014 as a privatecompany limited by shares under the Act with the name ‘Fishing Republic Limited’ and with theregistered number 9196822. The Company trades under the name Fishing Republic.

1.2 Pursuant to a special resolution passed on 20 May 2015, on 21 May 2015 the Company was re-registered in England and Wales as a public company limited by shares under the Act with the name‘Fishing Republic plc’.

1.3 The principal legislation under which the Company operates and under which the Shares have beenand will be issued is the Act and the regulations made under the Act. The liability of the members ofthe Company is limited.

1.4 The registered office and principal place of business of the Company is at Vulcan Works, ChestertonRoad, Rotherham, South Yorkshire S65 1SU, telephone number 01709 724 700.

1.5 The address of the Group’s website which discloses the information required by Rule 26 of the AIMRules is www.fishingrepublic.net.

2. Share capital of the Company2.1 In keeping with the Act, the articles of association of the Company do not place any limit on the

number of shares which the Company may issue.

2.2 The Company’s issued share capital (i) as at the date of this Document and (ii) as it is expected to beimmediately following Admission is as set out below:

As at the date of Immediately this Document following Admission

–––––––––––––––––––––––––––– ––––––––––––––––––––––––––––

Aggregate Aggregate nominal nominal

Class Number value Number value

Shares 13,750,000 £137,500 23,750,000 £237,500

2.3 The Placing will result in the allotment of 10,000,000 new Shares. This will dilute the then existingShareholders by approximately 42.1 per cent.

2.4 The Company was incorporated with an issued share capital of £100, divided into 100 shares of£1.00 each, all of which were issued on incorporation to the Principal Shareholder. On 18 May 2015,each issued and unissued ordinary share of £1.00 was sub-divided into 100 Shares. On 20 May2015, the Company issued 13,740,000 Shares pursuant to the terms of the Share ExchangeAgreement.

2.5 By a resolution of the Company passed on 29 May 2015 it was resolved conditionally upon (buteffective immediately prior to) Admission taking place on or prior to 3 July 2015, to pass the followingresolutions, amongst other things, to give the Directors authority to allot the Placing Shares, theNorthland Options and further Shares on and from Admission as follows:

(a) that pursuant to section 551 of the Act, the Directors be generally and unconditionallyauthorised to exercise all or any powers of the Company to allot Shares or grant rights tosubscribe for or to convert any security into a Share:

(i) up to an aggregate nominal amount equal to £100,000 in connection with the Placing;

Ann I, 5.1.1Ann I, 5.1.2Ann I, 5.1.3Ann I, 5.1.4Ann III, 4.2

Ann I, 5.1.4

Ann I, 5.1.4

Ann I, 21.1.3

60

(ii) up to an aggregate nominal amount equal to £23,075 in connection with the NorthlandOptions and the Share Option Plans;

(iii) following Admission, up to an aggregate nominal amount equal to £79,200 (beingequivalent to approximately one-third of the nominal value of the Enlarged Share Capital);and

(iv) following Admission and in connection with a rights issue, as defined below, up to anaggregate nominal amount equal to £79,200 (being equivalent to approximately a furtherone-third of the nominal value of the Enlarged Share Capital),

provided that (unless previously revoked, varied or renewed) these authorities shall expire onthe earlier of the date of the next annual general meeting of the Company and 30 September2016 (save that the Company may before the expiry of such period make an offer or agreementwhich would or might require Shares to be allotted or rights to be granted to subscribe for orconvert any security into a Share, after expiry of these authorities, and the Directors may allotthe Shares or grant rights to subscribe for or convert any security into an Share in pursuanceof such offer or agreement as if the authorisations conferred by this resolution had not expired).This authority is in addition to all existing authorities under section 551 of the Act.

For the purpose of paragraph 2.5(a)(iv) above, “rights issue” means an offer or invitation to(i) holders of Shares in proportion (as nearly as may be practicable) to the respective numbersof Shares held by them on the record date for such allotment; and (ii) persons who are holdersof other classes of equity securities if this is required by the rights of such securities (if any) or,if the Directors consider necessary, as permitted by the rights of those securities, to subscribefor further securities by means of the issue of a renounceable letter (or other negotiableinstrument) which may be traded for a period before payment for the securities is due, butsubject in both cases to such exclusions or other arrangements as the Directors may deemnecessary or expedient in relation to fractional entitlements, treasury shares, record dates orlegal, regulatory or practical difficulties which may arise under the laws of, or the requirementsof, any recognised regulatory body or any stock exchange in any territory or any other matterwhatever;

(b) that pursuant to section 570 of the Act, the Directors be generally empowered to allot equitysecurities (within the meaning of section 560(1) of the Act) for cash as if section 561(1) of theAct did not apply to any such allotment:

(i) pursuant to the authority granted as described in paragraph 2.5(a)(i) and (ii) above;

(ii) pursuant to the authority granted as described in paragraph 2.5(a)(iii) above inconnection with a rights issue or other pre-emptive offer but otherwise limited to anaggregate nominal amount equal to £47,500 (being equivalent to 20 per cent. of thenominal value of the Enlarged Share Capital); and

(iii) pursuant to the authority granted as described in paragraph 2.5(a)(iv) above, inconnection with a rights issue,

provided that (unless previously revoked, varied or renewed) these powers shall expire on theearlier of the date of the next annual general meeting of the Company and 30 September 2016(save that the Company may before the expiry of such period make an offer or agreementwhich would or might require Shares to be allotted or rights to be granted after expiry of thesepowers and the Directors may allot the Shares or grant rights to subscribe for or convert anysecurity into an Share in pursuance of such offer or agreement as if the powers conferred bythis resolution had not expired). These powers are in addition to all existing powers undersection 570 of the Act; and

(c) the Company adopt the Articles in substitution for, and to the exclusion of, the existing articlesof association of the Company.

2.6 Application has been made for the Enlarged Share Capital to be admitted to trading on AIM. TheShares are not listed or traded on and no application has been or is being made for the admission ofthe Enlarged Share Capital to listing or trading on any other stock exchange or securities market.

Ann III, 4.3

61

2.7 It is anticipated that the Placing Shares will be issued on 4 June 2015, the date on which Admissionis expected to become effective. With effect from Admission, all of the Shares will be in registeredform and, subject to the Shares being admitted to and accordingly enabled for settlement in CREST,the Shares will be capable of being held in uncertificated form. No temporary documents of title willbe issued.

2.8 10,000,000 Placing Shares are being issued pursuant to the Placing at a price of 15 pence per sharewhich represents a premium of 14 pence over their nominal value of one penny each. No expensesare being charged to any subscriber under the Placing.

2.9 Save in connection with the Placing or to fulfil options granted under the Share Option Plans describedin paragraph 4 below, there is no present intention to issue any share or loan capital in the Companyfollowing Admission.

2.10 Save as set out in this Document:

(a) the Company does not hold any treasury shares and no Shares are held by, or on behalf of,any member of the Group;

(b) no Shares have been issued otherwise than as fully paid;

(c) the Company has no outstanding convertible securities, exchangeable securities or securitieswith warrants;

(d) the Company has given no undertaking to increase its share capital; and

(e) no capital of any member of the Group is under option or is agreed, conditionally orunconditionally, to be put under option.

3. New Articles of AssociationThe new Articles of Association as conditionally adopted by special resolution dated 29 May 2014 containprovisions, amongst other things, to the following effect:

3.1 ObjectsThe Company has unrestricted objects.

3.2 Share capitalThe Articles do not contain any restrictions on the Company’s ability to:

3.2.1 consolidate and divide all or any of its share capital into shares of larger amounts than itsexisting shares; and

3.2.2 sub-divide its shares, or any of them, into shares with a smaller face value than the existingshares (subject, nevertheless, to the provisions of the Act).

The Company may by special resolution reduce its share capital and any capital redemption reserveand any share premium account or other undistributable reserve in any manner subject to anyconfirmation or consent required by law. The Company may issue shares which are to be redeemedor are liable to be redeemed at the option of the Company or the shareholders. Subject to theprovisions of the Act and the rights of holders of any class of shares, the Company may purchase itsown shares, including redeemable shares and the board may determine the terms, conditions andmanner of such redemption.

3.3 VotingSubject to any special terms as to voting upon which any shares for the time being may be held, ona show of hands every member who is present in person (which, in the case of a corporation, shallbe deemed to be the case if a duly appointed representative is present in person) or by proxy shallhave one vote, and on a poll every member present in person or by proxy, shall have one vote forevery share in the capital of the Company held by him.

Ann I, 21.1.4

Ann I, 21.1.6

Ann I, 21.2.8

Ann III, 4.3

62

A proxy need not be a member of the Company. The appointment of a proxy shall (unless the boardotherwise decides where it wishes to permit the delivery of proxies by means of electroniccommunication) be in writing under the hand of the appointor or of his attorney authorised in writingor, if the appointor is a corporation, either under its seal or under the hand of an officer, attorney orother person authorised to sign it.

At any general meeting a resolution put to the vote of the meeting shall be decided on a show ofhands unless a poll is duly demanded before or on the declaration of the result of the show of handsor on the withdrawal of any other demand for a poll. Subject to the provisions of the Act, a poll maybe demanded by: (i) the chairman of the meeting; or (ii) at least five members present in person or byproxy and entitled to vote; or (iii) any member or members present in person or by proxy andrepresenting, in aggregate, not less than one-tenth of the total voting rights of all members havingthe right to attend and vote at the meeting (excluding any voting rights attached to any shares in theCompany held as treasury shares); or (iv) any member or members present in person or by proxyand holding shares conferring a right to attend and vote at the meeting on which there have beenpaid up sums, in aggregate, equal to not less than one-tenth of the total sum paid up on all sharesconferring that right. In addition, the chairman may demand a poll before all, some or any of theresolutions are put to a vote on a show of hands.

A shareholder is also not entitled to attend or vote at meetings of the Company in respect of anyshares held by him in relation to which he or any other person appearing to be interested in suchshares has been duly served with a notice under section 793 of the Act and, having failed to complywith such notice within the period specified in such notice (being not less than 28 days from the dateof service of such notice or 14 days where the shares represent 0.25 per cent. of their class), is servedwith a disenfranchisement notice. Such disentitlement will apply only for so long as the notice fromthe Company has not been complied with or until the Company has withdrawn thedisenfranchisement notice, whichever is the earlier.

3.4 General meetingsThe Company shall in each year hold a general meeting as its annual general meeting in addition toany other meeting(s) in that year and such annual general meeting shall be held within six months ofthe Company’s accounting year end. Subject to the provisions of the Act, the annual general meetingshall be held at such time and place as the directors may determine.

The board may convene a general meeting in accordance with the Act whenever it thinks fit. A generalmeeting shall also be convened on such requisition, or in default may be convened by suchrequisitionists, as provided by sections 303 to 305 of the Act.

Subject to the provisions of the Act, an annual general meeting shall be called by not less than 21clear days’ notice, and all other general meetings shall be called by not less than 14 clear days’ notice.

The notice shall specify the place, date and time of meeting, and, in the case of special business, thegeneral nature of that business. Every notice shall contain a reasonably prominent statement that amember entitled to attend and vote is entitled to appoint one or more proxies to attend, speak andvote instead of him and that a proxy need not be a member of the Company. The notice conveningan annual general meeting shall specify the meeting as such, and the notice convening a meeting topass a special resolution shall specify the intention to propose the resolution as a special resolution(as the case may be).

Shorter notice than that specified above may be deemed to have been given in the case of an annualgeneral meeting by all the members entitled to attend and vote at the meeting; and in the case of anyother meeting, by a majority in number of the members having a right to attend and vote at themeeting, being a majority together holding not less than 95 per cent. in nominal value of the sharesgiving that right.

The accidental omission to give notice of a meeting or send any other notice or circular relating to itor (in cases where proxies are sent out with the notice) the accidental omission to send such proxyto, or the non-receipt of notice of a meeting or other notice or circular relating to it or such proxy by,any person entitled to receive such notice shall not invalidate the proceedings at that meeting.

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At any general meeting the chairman may make any arrangement and impose any requirement orrestriction which he considers appropriate to ensure the security and orderly conduct of a generalmeeting including, without limitation, requirements for evidence of identity to be produced by thoseattending the meeting, the searching of their personal property and the restriction of items that maybe taken into the meeting place. The chairman is entitled to refuse entry to a person who refuses tocomply with these arrangements, requirements or restrictions.

3.5 DividendsSubject to the provisions of the Act, the Company may by ordinary resolution from time to time declaredividends to be paid to the members according to their rights and interests in the profits available fordistribution, but no dividend shall be declared in excess of the amount recommended by the boardand no dividend shall be paid otherwise than out of profits available for the purpose in accordancewith the provisions of the Act.

The directors may from time to time pay such interim dividends as appear to the directors to bejustified by the profits of the Company and are permitted by the Act.

Unless and to the extent that the rights attached to any shares or the terms of issue of any sharesotherwise provide, all dividends shall (as regards any shares not fully paid throughout the period inrespect of which the dividend is paid) be apportioned and paid pro rata according to the amountspaid on the shares during any portion or portions of the period in respect of which the dividend ispaid. No amount paid on a share in advance of calls shall be treated as paid on the share.

The payment by the board of any unclaimed dividend or other moneys payable on or in respect of ashare into a separate account shall not constitute the Company a trustee in respect of it and anydividend unclaimed after a period of twelve years from the date such dividend is payable shall beforfeited and shall revert to the Company.

Where, in respect of any shares, any registered holder or any other person appearing to be interestedor have been interested in the shares of the Company fails to comply with any notice given by theCompany under Article 27.2, then, provided that the shares concerned represent at least 0.25 percent in number of the issued shares in the capital of the Company, the Company may withholddividends or other moneys payable on such shares.

3.6 Variation of rightsSubject to the provisions of the Act, all or any of the rights for the time being attached to any classof shares for the time being issued may (whether or not the Company is being wound up) be variedor abrogated with the consent in writing of the holders of not less than three-quarters in nominal valueof the issued shares of that class (excluding any shares held as treasury shares) or with the sanctionof a special resolution passed at a separate general meeting of the holders of the shares of the class.To any such separate general meeting all the provisions of the Articles as to general meetings of theCompany shall apply (with such changes as are necessary or appropriate in the circumstances), butso that the necessary quorum shall be two persons holding or representing by proxy not less thanone-third in nominal value of the issued shares of the class (excluding any shares of that class heldas treasury shares), that every holder of shares of the class shall be entitled on a poll to one vote forevery such share held by him, that any holder of shares of the class present in person or by proxymay demand a poll and that at any adjourned meeting of such holders one holder present in personor by proxy (whatever the number of shares held by him) shall be a quorum and for the purposes ofthe relevant Article one holder present in person or by proxy may constitute a meeting.

The rights conferred upon the holders of any shares or class of shares shall not, unless otherwiseexpressly provided in the Articles or in the terms of issue of such shares, be deemed to be varied bythe creation or issue of further shares ranking pari passu with them.

3.7 TransferabilitySubject to such of the restrictions of the Articles as may be applicable, any member may transfer allor any of his certificated shares by an instrument of transfer in the usual or common form or in anyother form which the board may approve. Title to any uncertificated shares shall, unless the CRESTRegulations otherwise provide, be effected by means of a relevant system.

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The instrument of transfer of a certificated share shall be signed by or on behalf of the transferor and(in the case of a partly paid share) the transferee and the transferor shall be deemed to remain theholder of the share until the name of the transferee is entered in the register of members in respectof the share. All instruments of transfer, when registered, may be retained by the Company.

The board may, in its absolute discretion and without assigning any reason, decline to register anytransfer of any certificated share that is not a fully paid up share (save where to do so would disturbthe market in the shares of that class on the London Stock Exchange) or of a share on which theCompany has a lien. The Company may refuse to register a transfer of an uncertificated share to theextent it is permitted to do so by the CREST Regulations (save where to do so would disturb themarket in the shares of that class on the London Stock Exchange).

No transfer of any share shall be made to a minor, bankrupt or person who is mentally disordered ora patient for any purpose of any statute relating to mental health.

The board may also decline to register any transfer of a certificated share (save where to do so woulddisturb the market in the shares of that class on the London Stock Exchange) unless:

(a) the instrument of transfer, duly stamped, is lodged with the Company accompanied by thecertificate for the shares to which it relates, and such other evidence as the board mayreasonably require to show the right of the transferor to make the transfer;

(b) the instrument of transfer is in respect of only one class of share; and

(c) in the case of a transfer to joint holders, the number of joint holders to whom the share is tobe transferred does not exceed four.

In the case of transfers of shares in certificated form by a financial institution, the lodgement of sharecertificates will only be necessary if and to the extent that certificates have been issued in respect ofthe shares in question.

If the board declines to register a transfer it shall send to the transferee notice of the refusal, togetherwith the reasons for the refusal, as soon as practicable and in any event within two months of thedate on which:

(a) the letter of allotment or instrument of transfer was lodged with the Company (in the case ofshares in certificated form); or

(b) the instrument attributable to the Operator (as defined in the CREST Regulations) was receivedby the Company (in the case of shares held in uncertificated form).

No fee shall be charged by the Company for registering any transfer, probate, letters of administration,certificate of death or marriage, power of attorney, stop notice, order of court or other instrument orany instruction given pursuant to the CREST Regulations relating to or affecting the title to any shareor otherwise making any entry in the register of members relating to any share.

Where, in respect of any shares, any registered holder or any person appearing to be interested orhave been interested in such shares fails to comply with any notice given by the Company underArticle 27.2, then, provided that the shares concerned represent at least 0.25 per cent in number ofthe issued shares in the capital of the Company, the Company may prohibit transfers of such sharesor agreements to transfer any of such shares (save in certain circumstance).

3.8 Directors of the Company3.8.1 Number of directors and shareholding qualification

Unless and until otherwise determined by ordinary resolution of the Company, the directors(disregarding alternate directors) shall be not less than two and not more than eight in number.

No shareholding qualifications for directors shall be required. A director who is not a membershall nevertheless be entitled to attend and speak at general meetings.

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3.8.2 Appointment and removal of directors

Subject to the provisions of the Articles, the Company may by ordinary resolution appoint anyperson to be a director, either to fill a casual vacancy or as an addition to the existing board,but so that the total number of directors shall not at any time exceed any maximum numberfixed by or in accordance with the Articles.

Without prejudice to the power of the Company by ordinary resolution in pursuance of any ofthe provisions of the Articles to appoint any person to be a director, the board shall have powerat any time and from time to time to appoint any person to be a director, either to fill a casualvacancy or as an addition to the existing board, but so that the total number of directors shallnot at any time exceed any maximum number fixed by or in accordance with the Articles. Anydirector so appointed by the board shall hold office only until the next following annual generalmeeting and shall then be eligible for reappointment but shall not be taken into account indetermining the directors or the number of directors who are to retire by rotation at suchmeeting.

The Company may by special resolution, or by ordinary resolution of which special notice hasbeen given in accordance with the provisions of the Act, remove any director before theexpiration of his period of office and may (subject to the provisions of the Articles) by ordinaryresolution appoint another person in his place. Any person so appointed shall be subject toretirement at the same time as if he had become a director on the day on which the directorin whose place he is appointed was last appointed as director. In default of such appointmentthe vacancy arising upon the removal of a director from office may be filled as a casual vacancy.

Subject to the provisions of the Articles, at every annual general meeting one-third of thedirectors for the time being or, if their number is not a multiple of three, then the number nearestto but not less than one-third shall retire from office.

3.8.3 Remuneration of directors

The remuneration by way of fees of the directors for their services as officers of the Company(excluding amounts payable under any other provision of these Articles) shall be determinedby the board but shall not exceed in aggregate the sum of £200,000 per year (which figureshall be subject to upward only adjustment in line with any percentage increase in the retailprices index (as defined in section 989 of the Income Tax Act 2007)) or such greater sums asthe Company may from time to time determine by ordinary resolution.

Each director may be paid or reimbursed in respect of his reasonable travelling, hotel andincidental expenses of attending and returning from meetings of the board or committees ofthe board or general meetings or separate meetings of the holders of any class of shares or ofdebentures of the Company and shall be paid all expenses properly and reasonably incurredby him in the conduct of or in connection with any activities undertaken in or about theCompany’s business or in the discharge of his duties as a director or in connection with theattendance of any spouse or civil partner of his on any occasion where such spouse or civilpartner accompanies a director for the purpose of advancing the business or interests of theCompany. Any director who, by request, goes or resides abroad for any purposes of theCompany or who performs services which in the opinion of the board go beyond the ordinaryduties of a director may be paid such extra remuneration (whether by way of salary,commission, participation in profits or otherwise) or may receive such other benefits as theboard or any committee authorised by the board may determine and such extra remunerationor benefits shall be in addition to any remuneration or benefits provided for by or pursuant toany other Article.

3.8.4 Directors’ interests

A director may hold any other office or place of profit with the Company (except that of auditor)in conjunction with his office of director or act by himself or his firm in a professional capacity(except that of auditor) for such period, subject to the provisions of the Act, and upon suchterms as the board may determine, and may be paid such extra remuneration (whether byway of salary, commission, participation in profits or otherwise) as the board may determine,

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and such extra remuneration shall be in addition to any remuneration provided for by orpursuant to any other provision of the Articles.

A director may be or become a director or other officer of or otherwise interested in, anycompany promoted by the Company or in which the Company may be interested or as regardswhich it has any power of appointment. He shall not be liable to account to the Company orthe members for any remuneration, profit or other benefit received by him as a director orofficer of or from his interest in such other company and no such transaction will be liable tobe avoided.

A director shall not vote or be counted in the quorum on any resolution of the board concerninghis own appointment as the holder of any office or place of profit with the Company or anyother company in which the Company is interested (including the arrangement or variation ofthe terms of such appointment, or its termination).

A director who is in any way, directly or indirectly, interested in a proposed transaction orarrangement with the Company, or in a transaction or arrangement that has been entered intoby the Company, must declare the nature and extent of his interest to the directors. Thedeclaration must be made at a meeting of the board, or by written notice, or by general notice,in accordance with the Act. In the case of a proposed transaction or arrangement, thedeclaration must be made before the Company enters into the proposed transaction orarrangement. In the case of an existing transaction or arrangement, the declaration must bemade as soon as reasonably practicable.

A director who has, or can have, an interest, direct or indirect, that conflicts, or possibly mayconflict, with the interests of the Company (including, without limitation, in relation to theexploitation of any property, information or opportunity, whether or not the Company couldtake advantage of it, but excluding any situation which cannot reasonably be regarded as likelyto give rise to a conflict of interest), must declare the nature and extent of his interest to theboard as soon as reasonably practicable. The board may resolve to authorise the potentialconflict situation on such terms as it may determine. A director shall not be liable to accountto the Company for any profit, remuneration or other benefit resulting from such conflictsituation.

Save as otherwise provided by the Articles, a director shall not vote (nor be counted in thequorum) on any resolution of the board in respect of any contract, arrangement or otherproposal in which he (together with any person connected with him) has to his knowledge amaterial interest and, if he shall do so, his vote shall not be counted but subject to the provisionsof the Act and in the absence of some other material interest, this prohibition shall not applyto, amongst others, any of the following matters:

(i) any transaction for giving to such director any guarantee, security or indemnity in respectof money lent by him or obligations undertaken by him at the request or for the benefitof the Company or any of its subsidiaries;

(ii) any transaction for the giving by the Company or any of its subsidiaries of any guarantee,security or indemnity to a third party in respect of a debt or obligation of the Companyor any of its subsidiaries in respect of which such director has himself given an indemnityor which he has guaranteed or secured in whole or in part; and

(iii) any transaction concerning any other company (not being a company in which suchdirector and persons connected with him to his knowledge own 7 per cent. or more) inwhich he is interested, directly or indirectly, whether as an officer, shareholder, creditoror otherwise.

3.8.5 Powers and duties of the board

The business of the Company shall be managed by the board, which may exercise all suchpowers of the Company as are not by the Act or by the Articles required to be exercised bythe Company in general meeting, subject to the provisions of the Act and the Articles and toany directions given by the Company in general meeting by special resolution.

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The board may establish local or divisional boards or agencies for managing any of the affairsof the Company, either in the United Kingdom or elsewhere, and may appoint any persons tobe members of such local or divisional boards, or any managers or agents, and may fix theirremuneration. The Board may delegate to them any of the powers, authorities and discretionsvested in or exercisable by the board, and may also give power to sub-delegate, and mayauthorise the members of any such local or divisional board or any of them to fill any vacancieson the board (and to act notwithstanding vacancies) and to fix their own remuneration.

3.8.6 Borrowing powers

Subject as provided in the Articles and to the provisions of the Act, the board may exercise allthe powers of the Company to borrow money and to mortgage or charge all or any part of theundertaking, property and assets and uncalled capital of the Company and (subject to the Act)to issue debentures and other securities, whether outright or as collateral security for any debt,liability or obligation of the Company or of any third party.

The board shall restrict the borrowings of the Company and exercise all voting and other rightsor powers of control exercisable by the Company in relation to its subsidiary undertakings (ifany) so as to secure (but as regards subsidiary undertakings only in so far as by the exerciseof such rights or powers of control as the board can secure) that the aggregate principalamount from time to time outstanding of all borrowings by the Group (exclusive of borrowingsowing by one member of the Group to another member of the Group other than amounts tobe taken into account pursuant to the Articles) shall not, without the previous sanction of anordinary resolution of the Company, at any time exceed an amount equal to two and one halftimes the aggregate of the amount paid up or credited as paid up on the issued share capitalof the Company and the amount standing to credit of the reserves but after making certainadjustments as set out in Article 42.

3.8.7 Indemnity

Subject to the provisions of the Act, every director and every director of each of the AssociatedCompanies of the Company shall be entitled to be indemnified by the Company in relation tothose duties including any liability incurred by him in defending any proceedings, civil or criminal,which relate to an officer or employee of the Company or in which he is acquitted or inconnection with any application under any statute for relief from liability in respect of any suchact or omission in which relief is granted by the Court.

3.9 Distribution of assets on liquidationThe board shall have power in the name and on behalf of the Company to present a petition to theCourt for the Company to be wound up.

If the Company shall be wound up, the liquidator may, with the authority of a special resolution of theCompany or any other sanction required by the Act or the Insolvency Act 1986, divide amongst themembers in specie or in kind the whole or any part of the assets of the Company as he sees fit, thoseassets to be set at such values as he deems fair. The liquidator may also vest the whole or part of theassets of the Company in trustees on trust for the benefit of the members.

3.10 Uncertificated sharesThe board may determine that any class of shares may be held in uncertificated form and that title tosuch shares may be transferred by means of a relevant system or that shares of any class shouldcease to be held and transferred as aforesaid. The Company shall not issue share certificates inrespect of uncertificated shares.

3.11 Pensions and gratuitiesSubject to the Act, the board on behalf of the Company or any committee authorised by the boardmay exercise all powers of the Company to grant or pay pensions, annuities, gratuities andsuperannuation or other allowances or benefits to any persons who are or have at any time beendirectors of the Company or the relations, connections or dependants of any director or formerdirector and, for the purpose of providing any such benefit or allowance, shall have power tocontribute to any scheme or fund or to pay premia in respect of such scheme or fund.

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3.12 Untraced shareholdersSubject to various notice requirements, the Company may sell any of a shareholder’s shares in theCompany if, during a period of 12 years, at least three dividends on such shares have become payableand no dividend has been claimed during that period in respect of such shares and the Companyhas received no communication from such shareholder.

If any securities of the Company are traded on the London Stock Exchange or dealt in on AIM, theCompany must first give notice in writing to the Quotations Department of the London StockExchange of its intention to sell such shares.

The net proceeds of sale shall belong to the Company and, upon their receipt, the Company shallbecome indebted to the former owner of, or person entitled by transmission to, the shares for anamount equal to the net proceeds. Such debt shall be a permanent debt of the Company, shall notaccrue any interest and the Company shall be deemed to be a debtor and not a trustee in respect ofthat amount for such member. The net proceeds of sale may either be employed in the business ofthe Company or invested in such investments (other than shares of the Company or its holdingcompany if any) as the directors may from time to time think fit and the Company shall not be requiredto account to the former member to such shares for interest or other moneys earned from suchproceeds.

3.13 Purchase of own sharesSubject to the provisions of the Act and the Articles and to any confirmation or consent required bylaw, the Company may from time to time purchase its own shares (including any redeemable shares)provided that if there are in issue any convertible shares of the Company then no purchase by theCompany of any of its own shares shall take place unless it has been sanctioned by a specialresolution passed at a separate class meeting of the holders of each class of convertible shares.

3.14 GeneralSave as disclosed in this paragraph 3, the Articles do not:

3.14.1 require any action that is necessary to change the rights of holders of shares in the Companywhere the conditions are more significant than is required by law;

3.14.2 contain any provision that would have the effect of delaying, deferring or preventing a changeof control of the Company;

3.14.3 contain any provision governing the ownership threshold above which shareholder ownershipmust be disclosed; and

3.14.4 impose any condition governing changes in the capital that is more stringent than is requiredby law.

4. Share incentive arrangementsThe Company proposes to adopt the Share Option Plans on the Business Day preceding the date ofAdmission. Options will be granted under the Share Option Plans to employees and officers of the Companyand consultants to the Company.

It is proposed that options (the “EMI Options”) over Shares with a combined value of £137,000, will begranted to employees of the Company on the date of Admission. These EMI Options will be granted on thedate of Admission, with an exercise price equal to the closing mid-market value of the Shares on the dateof Admission.

In addition to the EMI Options, it is proposed that further options over Shares with a combined value of£70,000 will be granted on the same date to James Newman, Ed McDermott and Robert Tippett. Theseoptions (the “Unapproved Options”) will have the same price as, and be subject to the same rules as, theEMI Options but with the exception that the Unapproved Options will not be entitled to benefit from EMI taxtreatment.

Under the rules of the Share Option Plans, the EMI Options and the Unapproved Options (together, the“Options”) are not exercisable until a period of three years has passed from the date of grant. Additionally,

Ann I, 17.3

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the exercise of some of the Options is subject to the satisfaction of performance conditions. The Optionswill lapse if the option holder ceases to be an employee or officer of, or consultant to, the Group.Notwithstanding the holding period and performance conditions, all Options may be exercised in the eventthat a purchaser makes an offer to acquire more than 50 per cent. of the share capital of the Company. TheRemuneration Committee may, at its absolute discretion, permit the exercise of EMI Options in circumstanceswhere the Options would not otherwise be exercisable.

Further Options may be granted in the future under the Share Option Plans.

The exercise of Options may be satisfied by either the issue or transfer of new Shares in the Company. Ifunexercised, all Options will lapse once ten years has elapsed since their date of grant. The Share OptionPlans will terminate and no further Options may be granted once a period of ten years has elapsed from thedate of adoption.

5. Information on the Directors5.1 The names and functions of the Directors are as follows:

Name Function

James Henry Newman Independent Non-Executive ChairmanStephen John Gross Chief Executive OfficerRobert Tippett Finance DirectorZoe Gross Operations DirectorPaul Hagerty IT DirectorEdward Peter McDermott Independent Non-Executive Director

5.2 The Directors hold or have held the following directorships (other than the Company) or are or havebeen partners in the following partnerships within the five years prior to the date of this Document:

Current directorships and Past directorships and partnerships Name partnerships held in past five years

James Newman Finance Yorkshire Limited BGLOBAL Public Limited CompanyMasonic Charitable Services Blackwall LimitedRMBI Pension Trust Limited Connect YorkshireRMBI Trading Limited Dignity PLCR.M.B.I. Trust Scott Wilson Group plcSheffield City Region Local Straight LimitedEnterprise Partnership Limited The Cutlers’ Hall Preservation TrustWest Wood on Derwent Limited Limited

The Master Cutler LimitedVianet Group PLC

Stephen Gross A K Construction (South Yorkshire) Delphi Estates LimitedLimited Diamond Homes (Northern) LimitedAngling Foundation LimitedDearne Valley Property LimitedDiamond Homes (Northern) LimitedKlobba LimitedLureflash International LimitedThe Angling Trades Association LimitedWickham Homes (Northern) Ltd

Sch 2 (g)(ii)

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Current directorships and Past directorships and partnerships Name partnerships held in past five years

Zoe Gross Lureflash International Limited –

Robert Tippett Leesing Marrison Lee Limited –R.Tippett Limited

Paul Hagerty – –

Edward Special Situations Capital Limited GMOW (Operations) LimitedMcDermott Marlborough Private Equity Limited Stellar Resources Plc

Spartan Natural Resources LimitedNoricum Gold Limited

5.3 The Principal Shareholder (together with Zoe Gross in relation to certain of the properties) currently ownsseven properties from which Lureflash trades and acts as landlord to Lureflash in respect of thoseproperties. The Principal Shareholder and, where applicable, Zoe Gross and the Company have enteredinto formal leases on an arm’s length basis in respect of each of the seven properties. Further details ofthese leases are set out in paragraph 10.8 below.

5.4 Save as described in paragraph 5.3 above, none of the Directors has any business interests oractivities outside the Group which are significant with respect to the Group.

5.5 Save as disclosed in paragraph 5.6 below, none of the Directors:

(a) has any unspent convictions in relation to indictable offences;

(b) has been made bankrupt or has made an individual voluntary arrangement with creditors orsuffered the appointment of a receiver over any of his assets;

(c) has been a director of any company which, whilst he was such a director or within 12 monthsafter his ceasing to be such a director, was put into receivership, compulsory liquidation,creditors’ voluntary liquidation, administration, company voluntary arrangement or anycomposition or arrangement with the company’s creditors generally or with any class of itscreditors or had an administrator or an administrative or other receiver appointed;

(d) has been a partner in any partnership which, whilst he was a partner, or within 12 months afterhis ceasing to be a partner, was put into compulsory liquidation or had an administrator or anadministrative or other receiver appointed or entered into any partnership voluntaryarrangement;

(e) has had an administrative or other receiver appointed in respect of any asset belonging eitherto him or to a partnership of which he was a partner at the time of such appointment or withinthe 12 months preceding such appointment; or

(f) has received any public criticisms by statutory or regulatory authorities (including recognisedprofessional bodies) or has ever been disqualified by a court from acting as a director of acompany or from acting in the management or conduct of the affairs of any company.

5.6 (a) A fixed charge receiver was appointed over the real property assets of A K Construction (SouthYorkshire) Limited (“AK”) on 11 April 2014 in respect of charges held by Lloyds TSB Bank Plcover those real property assets of AK. The Principal Shareholder is the sole director and soleshareholder of AK. Such appointment is expected to result in a shortfall to Lloyds TSB Bankplc of approximately £420,000.

(b) James Newman was a director of Arbre Energy Limited and Arbre Farming Limited, subsidiariesof Kelda Group plc, until May 2002 when he resigned when both companies were sold byKelda Group plc. Following this sale both companies were put into creditors’ voluntaryliquidation by their new owners on 7 August 2002. On 19 August 2002, meetings of creditorswere held at which the appointment of the liquidators was approved and the statements ofaffairs were sworn by the directors. In relation to Arbre Energy Limited the statement of affairsfiled at Companies House reveals the estimated amounts outstanding to the shareholders andthe company’s general creditors were £1,000,000 and £11,293,458, respectively, as at

Sch 2 (g)(iii)

Sch 2 (g)(iv)

Sch 2 (g)(v)

Sch 2 (g)(vi)

Sch 2 (g)(vii)

Sch 2 (g)(viii)

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7 August 2002. In relation to Arbre Farming Limited the statement of affairs filed at CompaniesHouse reveals the estimated amounts outstanding to the shareholders and the company’sgeneral creditors were £100 and £3,124,428, respectively, as at 7 August 2002. Bothcompanies have been dissolved.

(c) James Newman was a director of Span 2000 Limited. On 5 August 2003, following a periodduring which the company had ceased to trade, three months’ notice was given that unlesscause was shown to the contrary the company would be struck off the register and dissolved.The company was struck off the register on 18 November 2003 and dissolved on 23 November2003. The company had no creditors apart from directors and shareholder loans totallingapproximately £85,000.

6. Directors’ and other interests

6.1 The interests (all of which are or will be beneficial unless otherwise stated) of each Director includingany interest known to that Director or which could with reasonable diligence be ascertained by himof any person connected with a Director within the meaning of sections 252 to 255 of the Act (a“Connected Person”) in the share capital of the Company at the date of this Document and as theywill be immediately following Admission are as follows:

At the date of Immediately this Document following Admission

–––––––––––––––––––––––––––– ––––––––––––––––––––––––––––

% of % of No. of issued No. of Enlarged

Name Shares share capital Shares Share Capital

James Newman – – 133,335 0.6Stephen Gross(i) 10,330,000 75.1 10,330,000 43.5Zoe Gross(ii) 2,100,000 15.3 2,100,000 8.8Robert Tippett 68,750 0.5 68,750 0.3Paul Hagerty – – – –Edward McDermott – – – –

(i) Includes 1,362,500 Shares legally and beneficially held by Mr J H Gross, Steve Gross’ father, but excludes Shares held byZoe Gross.

(ii) Zoe Gross is Stephen Gross’ wife. The Shares set out opposite Mrs Gross’ name do not include those held by Mr Grossor any Connected Persons of Mrs Gross if such Connected Persons are also Connected Persons of Mr Gross.

6.2 On the date of Admission, the following options are expected to be held over Shares pursuant to theShare Option Plans by the Directors:

Value of ExerciseShares price EMI/ Exercise

Name under option (pence) Unapproved period

Robert Tippett £30,000 Closing mid-market Unapproved 3-10 years fromvalue on the date of Option grant date

AdmissionPaul Haggerty £30,000 Closing mid-market EMI Option 3-10 years from

value on the date of grant date Admission

James Newman £20,000 Closing mid-market Unapproved 3-10 years fromvalue on the date of Option grant date

AdmissionEdward McDermott £20,000 Closing mid-market Unapproved 3-10 years from

value on the date of Option grant dateAdmission

6.3 Save as disclosed in this paragraph 6, neither any Director nor any Connected Person has, at thedate of this Document, or will have, immediately following Admission, any interest, whether beneficialor non-beneficial, in the share or loan capital of the Company or any of its subsidiaries or any relatedfinancial product referenced to the Shares.

Ann I, 17.2

Ann I, 17.2

Sch 2(i)

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6.4 In addition to the interests of Directors and their Connected Persons disclosed in this paragraph 6,the Company is aware of the following Shareholders who are at the date of this Document, or will beimmediately following Admission, interested, directly or indirectly, in 3 per cent. or more of the issuedshare capital of the Company.

At the date of Immediately this Document following Admission

–––––––––––––––––––––––––––– ––––––––––––––––––––––––––––

% of % of No.of issued No. of Enlarged

Name Shares share capital Shares Share Capital

Miton Group plc – – 3,333,333 14.0Paul Turner(i) 1,237,500 9.0 1,237,500 5.2

(i) Paul Turner is Zoe Gross’ brother

6.5 At Admission the Shareholders listed in the table above will not have different voting rights to otherShareholders.

6.6 Save as disclosed in this paragraph 6, the Company is not aware of any person or entity who, directlyor indirectly, jointly or severally, will or could exercise control over the Company immediately followingAdmission and there are no arrangements the operation of which could result in a change of controlof the Company.

6.7 Save as described in this Document, no Director has or has had any interest in any transaction whichis or was unusual in its nature or conditions or significant to the business of the Group and waseffected during the current or immediately preceding financial year or was effected during any earlierfinancial year which remains outstanding and unperformed in any respect.

6.8 There are no loans or guarantees granted or provided by any Group Company to or for the benefit ofany of the Directors which are now outstanding.

7. Service agreements, letters of appointment and remuneration of the Directors

7.1 The Executive Directors have entered into the following new service agreements with the Company,conditional upon Admission:

7.1.1 Stephen J Gross (Chief Executive Officer)

Mr Gross entered into an executive service agreement (the “Service Agreement”), conditionalupon Admission, with the Company on 29 May 2015, although his period of continuousemployment with Lureflash began on 1 May 1985. Under the terms of the Service AgreementMr Gross’ employment will continue unless either the Company or Mr Gross terminates theagreement by giving not less than six months’ prior written notice. Upon notice being served,the Service Agreement provides the Company with the right to place Mr Gross on garden leaveand/or to pay him in lieu of notice. If Mr Gross is paid in lieu of notice he will receive his basicsalary only and the Company may pay such sums in monthly instalments until the date thenotice period would have expired if notice had been given. Mr Gross would be obliged to seekalternative income during any remaining notice period and the Company may reduce theinstalments of notice pay by the amount of such income received by Mr Gross. During anyperiod of garden leave Mr Gross would be entitled to receive his basic salary and contractualbenefits. Mr Gross’ annual salary is £50,000. He is also entitled to the following benefits; 30days of holiday plus bank holidays, private medical insurance, life assurance and permanenthealth insurance. Mr Gross is not entitled to a pension contribution under the terms of hisService Agreement.

There is a six month non-solicitation provision preventing Mr Gross from employing or engagingor endeavouring to entice away any key employee of any Group Company; a provisionpreventing Mr Gross from providing competing goods or services to any organisation whichcompetes or intends to compete with the Company for six months following the termination

Ann I, 18.2

Ann I, 18.3Ann I, 18.4

Ann I, 16.1Ann I, 16.2

Ann I, 18.1

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of his employment; a six month non-solicitation provision preventing Mr Gross from seeking toentice away or otherwise solicit or interfere with the relationship between any Group Companyand any supplier or deal with any supplier; and a six month non-solicitation provision whichprevents Mr Gross from being involved with any supplier where such involvement would havethe result that the supplier would cease or reduce its supply to any Group Company. There isalso a six month non-compete provision, preventing Mr Gross engaging in a business whichcompetes or is likely to compete with the business of any Group Company. Nothing in thenon-compete restriction will prevent Mr Gross from being engaged or concerned in: (i) anybusiness relating solely to geographical areas where the business concern in not in competitionwith the Company or any Group Company; and (ii) any business for which Mr Gross is alreadya director as at the date her enters into the service agreement.

7.1.2 Zoe Gross (Operations Director)

Mrs Gross entered into an executive service agreement, conditional upon Admission, with theCompany on 29 May 2015, although her period of continuous employment with Lureflashbegan on 24 February 1997. Mrs Gross’ service agreement is, in all material respects, in theform of Mr Gross’, save for the following: her notice period is three months, her salary is£30,000, she is entitled to participate in the Share Option Plan, and she is entitled to a companycar. (but she is not entitled to life assurance, or permanent health insurance). Mrs Gross’ serviceagreement does not contain a carve out in respect of any current directorships in relation tothe non-compete post-termination restriction.

7.1.3 Robert Tippett (Finance Director)

Mr Tippett will be provided as a consultant under a consultancy agreement between LeesingMarrison Lee Limited and the Company (to provide the Group with accountancy and otherservices) entered into on 29 May 2015. Under the terms of the consultancy agreement, theservices will be provided for at least five days per calendar month and the Company will payLeesing Marrison Lee Limited a fee of £300 per day (plus VAT) for the provision of thoseservices. Also under the terms of the consultancy agreement, Mr Tippett will receive a fee of£2,000 per annum for services he will provide to the Company as an executive director. Theconsultancy agreement can be terminated on three months' notice and Mr Tippett is entitledto participate in the Share Option Plans.

7.1.4 Paul Hagerty (IT Director)

Mr Hagerty entered into an executive service agreement, conditional upon Admission, with theCompany on 29 May 2015, although his period of continuous employment with Lureflashbegan on 29 May 2007. Mr Hagerty’s service agreement is, in all material respects, in the formof Mrs Gross’, save that his holiday entitlement is 28 days plus bank holidays.

7.2 The Non-Executive Directors have entered into the following letters of appointment with the Company,conditional on Admission:

7.2.1 James Newman (Independent Non-Executive Chairman)

Mr Newman has been appointed as Non-Executive Chairman of the Company and enteredinto a letter of appointment with the Company on 29 May 2015. The appointment is for aninitial period of three years from the date of Admission and entitles Mr Newman to receive afee of £25,000 per annum and the options over Shares pursuant to the Share Option Planswith a value of £20,000. The appointment is terminable by either party giving to the other threemonths’ written notice (during the first 12 months of the term) extending to six months’ writtennotice (for the remainder of the term). The Company may terminate the appointmentimmediately if, amongst other things, Mr Newman: (i) is required to vacate the office of directorby reason of the provisions of the articles of association of the Company in force from time totime; (ii) fails to attend three consecutive meetings without due cause; (iii) performs some actor engages in some activity which is liable to bring him or the Company into disrepute or ismaterially adverse to the interests of the Company; or (iv) is in material breach of the terms ofhis appointment letter. Unless Mr Newman’s appointment is terminated for a reason referredto in (ii), (iii) or (iv) above, Mr Newman will be entitled to a payment in lieu of his notice period.

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7.2.2 Edward McDermott (Independent Non-Executive Director)

Mr McDermott has been appointed as Non-Executive Director of the Company and enteredinto a letter of appointment with the Company on 29 May 2015. The appointment is for aninitial period of three years from the date of appointment and entitles Mr McDermott to receivea fee of £20,000 per annum and the options over Shares pursuant to the Share Option Planswith a value of £20,000. The appointment is terminable by either party giving to the other threemonths’ written notice. The Company may terminate the appointment immediately if, amongstother things, Mr McDermott: (i) is required to vacate the office of director by reason of theprovisions of the articles of association of the Company in force from time to time; (ii) fails toattend three consecutive meetings without due cause; (iii) performs some act or engages insome activity which is liable to bring him or the Company into disrepute or is materially adverseto the interests of the Company; or (iv) is in material breach of the terms of his appointmentletter. No amounts are payable to Mr McDermott if he is removed as a Director or if hisappointment is terminated in accordance with the terms of his appointment letter.

7.3 Save as set out in paragraphs 7.1 and 7.2 above, on Admission there will be no existing or proposedservice agreements between the Directors and any member of the Group. Furthermore, there are nocommissions or profit-sharing arrangements with any of the Directors.

7.4 The service agreements/letters of appointments described in paragraphs 7.1 and 7.2 above do notprovide for benefits upon termination of employment other than as set out in those paragraphs.

8. Significant subsidiaries

The Company is the holding company of the Group and has the following subsidiary (which is wholly ownedand incorporated in England and Wales). Further details are set out in paragraph 10.6 below.

Name Nature of business Issued and fully paid share capital

Lureflash Fishing tackle retailer £137,500

9. United Kingdom taxation

The following statements are intended only as a general guide to current UK tax legislation andto the current practice of HMRC and may not apply to certain Shareholders, such as dealers insecurities, insurance companies and collective investment schemes. They relate (except wherestated otherwise) to persons who are resident in the UK for UK tax purposes, who are beneficialowners of Shares and who hold their Shares as an investment (and not as employment-relatedsecurities). Any person who is in any doubt as to his or her tax position, or who is subject totaxation in any jurisdiction other than that of the UK, should consult his or her own professionaladvisers immediately.

9.1 DividendsUnder UK tax legislation, the Company is not required to withhold tax at source from dividendpayments it makes.

Individual Shareholders resident for tax purposes in the UK should generally be entitled to a tax creditin respect of any dividend received equal to one-ninth of the amount of the dividend.

An individual Shareholder’s liability to income tax will be calculated on the sum of the dividend andthe tax credit (the “gross dividend”). This will be regarded as the top slice of the individual’s incomeand will be subject to UK income tax at the rates described below.

The tax credit equals 10 per cent. of the gross dividend. The tax credit will be available to set againsta Shareholder’s liability (if any) to income tax on the gross dividend.

Individual Shareholders liable to income tax at no more than the basic rate will be liable to income taxon dividend income received at the rate of 10 per cent. of the gross dividend. This means that thetax credit will satisfy in full the individual Shareholder’s liability to pay income tax on the dividendreceived. To the extent that the tax credit exceeds a Shareholder’s tax liability to UK income tax suchShareholder will not be entitled to claim payment of the excess from HMRC.

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The rate of income tax applied to dividends received by an individual Shareholder liable to incometax at the higher rate will be 32.5 per cent. In the case of a dividend received by an individualShareholder liable to income tax at the additional rate, the rate of income tax will be 37.5 per cent.After taking into account the 10 per cent. tax credit, a higher rate taxpayer will be liable to additionalincome tax of 22.5 per cent. of the gross dividend, equal to 25 per cent. of the net dividend and anadditional rate taxpayer will be liable to additional income tax of 27.5 per cent. of the gross dividend(equal to 30.6 per cent. of the net dividend).

For example, an individual Shareholder receiving a dividend of £90 would receive a tax credit of £10.The gross dividend (the cash dividend plus the tax credit) would be £100. If the Shareholder is ahigher rate taxpayer, he would be taxed on the dividend at £32.50 (32.5 per cent. of £100) but canset against this the tax credit of £10. This leaves tax to pay of £22.50, which is 25 per cent. of the£90 dividend received.

Trustees who are liable to income tax at the rate applicable to trusts (currently 45 per cent.) will paytax on the gross dividend at the dividend trust rate of 37.5 per cent. against which they can set thetax credit. To the extent that the tax credit exceeds the trustees’ liability to account for income taxthe trustees will have no right to claim repayment of the tax credit.

A corporate Shareholder resident for tax purposes in the UK will not normally be liable to corporationtax on any dividends received, but cannot claim payment of the tax credit from HMRC.

United Kingdom pension funds and charities are generally exempt from tax on dividends which theyreceive but they are not entitled to claim repayment of the tax credit.

Individual Shareholders who are resident for tax purposes in countries other than the UK but who areCommonwealth citizens, nationals of states which are part of the European Economic Area, residentsof the Isle of Man or the Channel Islands or certain other persons are entitled to a tax credit as if theywere resident for tax purposes in the UK, which they may set off against their total UK income taxliability. Such Shareholders will generally not be able to claim payment of the tax credit from HMRC.

Other Shareholders who are not resident in the UK for tax purposes should consult their own advisersconcerning their tax liabilities on dividends received. They should note that they will not generally beentitled to claim payment of any part of their tax credit from HMRC under any double taxation treatyor otherwise or such claim may be negligible.

9.2 Chargeable gainsShareholders who are resident in the UK for tax purposes and who dispose of their Shares at a gainwill ordinarily be liable to UK taxation on chargeable gains, subject to any available exemptions orreliefs. The gain will be calculated as the difference between the sale proceeds and any allowablecosts and expenses, including the original acquisition cost of the Shares.

Shareholders who are not resident in the UK for tax purposes but who carry on a trade, professionor vocation in the UK through a permanent establishment, branch, agency or fixed place of businessin the UK may be liable to UK taxation on chargeable gains on any gain on a disposal of their Shares,if those Shares are or have been held, used or acquired for the purposes of that trade, profession orvocation or for the purposes of that permanent establishment, branch, agency or fixed place ofbusiness.

If an individual Shareholder ceases to be resident in the UK and subsequently disposes of Shares, incertain circumstances any gain on that disposal may be liable to UK capital gains tax upon thatShareholder becoming once again resident in the UK.

9.3 Stamp duty and stamp duty reserve tax (“SDRT”)The statements below are intended as a general guide to the current position. They do not apply tocertain intermediaries who are not liable to stamp duty or SDRT, or to persons connected withdepositary arrangements or clearance services, who may be liable at a higher rate.

The allotment and issue of the Placing Shares will not give rise to a liability to stamp duty or SDRT.

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As from 28 April 2014, transfers of shares in AIM quoted companies are no longer subject to stampduty or SDRT. For this to apply to transfers of Shares, AIM must be recognised by HMRC as arecognised growth market and the Shares must not be listed on any other market.

9.4 AIMCompanies whose shares trade solely on AIM are deemed to be unlisted for the purposes of certainareas of UK taxation. Shares held by individuals for at least two years may qualify for more generousexemptions from inheritance tax on death or in relation to lifetime transfers of those shares.Shareholders should consult their own professional advisers on whether an investment in an AIMsecurity is suitable for them, or whether the tax benefit referred to above may be available to them. Itis possible to hold shares traded solely on AIM in individual savings accounts (ISAs).

10. Material contracts

The following are the only contracts (not being contracts entered into in the ordinary course of business)which have been entered into by any member of the Group within the two years immediately preceding thedate of publication of this Document and which are, or may be, material to the Group or have been enteredinto by any member of the Group at any time and contain a provision under which any member of the Grouphas any obligation or entitlement which is material to the Group at the date of this Document:

10.1 Placing AgreementOn 29 May 2015, (1) the Company, (2) the Directors and (3) Northland entered into the PlacingAgreement. The Placing Agreement contains, among others, the following provisions:

(a) the Company has agreed, subject to certain conditions, to allot and issue (subject only toAdmission), at the Placing Price, the Placing Shares;

(b) Northland has agreed, subject to certain conditions, to use reasonable endeavours to procuresubscribers for the Placing Shares;

(c) the Company has agreed to pay to Northland, to the extent not already paid, a corporatefinance fee and in addition a commission which amounts to 5 per cent. of the Placing Pricemultiplied by the aggregate number of Placing Shares to be issued pursuant to the Placing;

(d) the Company has agreed to pay or cause to be paid (together with any applicable VAT) allcosts, charges, fees and expenses of or arising in connection with, or incidental to, the Placing;

(e) the obligations of the parties pursuant to the Placing Agreement are subject to certainconditions, including, among others, that Admission occurs by not later than 8.00 a.m. on4 June 2015 or such later time and/or date (being not later than 3 July 2015) as Northlandmay agree with the Company. Northland shall be entitled to terminate the Placing Agreementin certain circumstances prior to Admission, including in circumstances of a breach of any ofthe warranties under the Placing Agreement, the occurrence of certain material changes in thecondition (financial or otherwise) or prospects of the Group (and any member of it) and certainchanges in financial, political or economic conditions; and

(f) the Company and the Directors have each given certain customary warranties to Northland inconnection with, among other matters, the Group and its business and liabilities and thePlacing. In addition, the Company has given certain indemnities to Northland, its subsidiariesand their respective directors, officers, employees and agents. The liabilities under the PlacingAgreement of the Directors are limited as to time and amount.

10.2 Nomad and broker agreement with NorthlandOn 29 May 2015, the Company entered into an agreement with Northland, pursuant to which theCompany appointed Northland to act as nominated adviser and broker to the Company from thedate of the agreement for an initial term of one year and thereafter subject to termination on the givingof three months’ notice by either party. The agreement contains covenants on the part of theCompany in favour of Northland, its subsidiaries and their respective directors, officers, employeesand agents (in certain cases) relating to the Company’s position as a company whose shares areadmitted to trading on AIM and other matters relating to its financial and trading position.

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10.3 Northland Option AgreementOn 29 May 2015, the Company and Northland entered into the Northland Option Agreement underwhich, conditionally upon and with effect from Admission, the Company irrevocably grants Northlandthe right to subscribe for 237,500 Shares (representing 1 per cent. of the Enlarged Share Capital) atthe Placing Price. The option may be exercised in whole or in part by Northland after Admission upto midnight on the fifth anniversary of the date of Admission. The agreement contains provisions inrelation to the adjustment of the exercise price and/or the number of Shares the subject of the optionif certain changes are made to the Company’s share capital.

10.4 Holland Bendelow consultancy agreementOn 12 May 2014, Lureflash entered into an agreement for the provision of consultancy services withHolland Bendelow Limited (“Holland Bendelow”). Under this agreement, Holland Bendelow agreedto undertake certain flotation consultancy services for Lureflash. The agreement provides for thefollowing fees (all exclusive of VAT) to be payable by Lureflash to Holland Bendelow: preliminary feesof £11,000 together with additional fees, if the flotation and fundraising were to go ahead, of £15,000on Admission. Furthermore, Lureflash will pay to Holland Bendelow a commission of 1.5 per cent.on total funds raised (being the Placing Price multiplied by the aggregate number of Placing Sharesissued pursuant to the Placing).

10.5 Lock in agreements with certain Shareholders

On 29 May 2015, lock-in agreements were entered into between Northland, the Company and eachof the Principal Shareholder, Zoe Gross, John H Gross, Paul Turner, James Newman, Robert Tippettand Russell Holmes (the “Locked-in Shareholders”), pursuant to which each of the Locked-inShareholders have agreed not to dispose of any interest in Shares (the “Lock-in Period”) for the periodof 12 months following Admission, except with the prior written consent of Northland, or in certainother customary circumstances. In addition, the Locked-in Shareholders have also agreed for a furtherperiod of 12 months (subject to the consent of Northland, not to be unreasonably withheld or delayed)(the “Orderly Marketing Period”) only to dispose of an interest in Shares through the Company’s brokerfrom time to time (subject to certain exceptions).

10.6 Share Exchange AgreementOn 20 May 2015, the Company and the former shareholders of Lureflash entered into the ShareExchange Agreement under which each such former shareholder exchanged all of its shares inLureflash for Shares. The exchange of Lureflash shares for Shares pursuant to the Share ExchangeAgreement will not be reflected in the register of members of Lureflash until the relevant stock transferforms relating to such exchange have been duly stamped (or appropriately adjudicated) by the StampOffice (although the entire issued share capital of Lureflash became beneficially owned by theCompany as from the date of that agreement). The stamping (or adjudication) is expected to takeplace before or shortly after Admission at which stage the name of the Company can be entered intothe register of members of Lureflash.

10.7 Relationship Agreement(a) On 29 May 2015, the Company entered into the Relationship Agreement with the Principal

Shareholder, Zoe Gross and Northland. The Relationship Agreement is conditional uponAdmission becoming effective. Under the Relationship Agreement the Principal Shareholderand Zoe Gross have, inter alia, agreed to:

(i) conduct all transactions and relationships with any member of the Group on arm’s lengthterms and on a normal commercial basis;

(ii) not exercise any of the voting rights attaching to the Shares in his or her control or anyother powers of control by virtue of his or her holding of Shares in such a manner so asto procure any amendment to the Articles which would be inconsistent with or breachany of the provisions of the Relationship Agreement; and

(iii) take all reasonable efforts to procure that the Non-Executive Directors shall beIndependent Directors (that is directors who would be considered independent from theCompany applying the definition of independent in section B.1.1 of the United Kingdom’s2014 Corporate Governance Code (as amended)).

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(b) Save in respect of the provisions relating to the leasing arrangements between the Group andStephen Gross which shall continue until the Relationship Agreement has terminated inaccordance with its terms, the Relationship Agreement shall continue until such time as thePrincipal Shareholder and/or certain related persons cease to hold shares that jointly representat least 30 per cent. of the issued share capital of the Company, and shall terminate if the sharecapital of the Company ceases to be admitted to trading on AIM.

10.8 Lease AgreementsOn 29 May 2015, the Principal Shareholder and, save in relation to the Hull property, Zoe Grossentered into formal lease agreements with the Company (each conditional on Admission) in respectof the properties occupied by the Group listed below. None of the lease agreements contain breachclauses, all have upwards only market basis rent reviews every fifth anniversary of the termcommencement date and the Company is obliged to carry out all repairs under each of the leaseagreements.

(a) 322 Southcotes Lane, Hull HU9 3TN. There is a rent-free period until 1 January 2017, afterwhich the rent will be £2,600 per annum. The term is 25 years from completion of the lease(expected to be 4 June 2015);

(b) Unit 5 Churchill Buildings, Churchill Road, Doncaster DN1 2TF. The rent is £514 per monthbetween 1 June 2015 and 31 December 2015. Between 1 January 2016 and 31 December2016 the rent will be £9,000 per annum. From 1 January 2017 the rent will be £12,000 perannum. The term is 25 years from completion of the lease (expected to be 4 June 2015);

(c) 19 Rutland Street, Swinton, Manchester M27 6AU. The rent is £514 per month between 1 June2015 and 31 December 2015. Between 1 January 2016 and 31 December 2016 the rent willbe £9,000 per annum. From 1 January 2017 the rent will be £12,000 per annum. The term is25 years from completion of the lease (expected to be 4 June 2015);

(d) 15 Stoke Street, Off Effingham Rd, Sheffield S9 3QH.The rent is £514 per month between1 June 2015 and 31 December 2015. Between 1 January 2016 and 31 December 2016 therent will be £9,000 per annum. From 1 January 2017 the rent will be £12,000 per annum. Theterm is 25 years from completion of the lease (expected to be 4 June 2015);

(e) Snapehill Road, Darfield, Barnsley, South Yorkshire S73 9LT. The rent is £514 per monthbetween 1 June 2015 and 31 December 2015. Between 1 January 2016 and 31 December2016 the rent will be £9,000 per annum. From 1 January 2017 the rent will be £12,000 perannum.The term is 25 years from completion of the lease (expected to be 4 June 2015);

(f) Woodbine Street, Hendon Ind Estate, Sunderland, Tyne & Wear SR1 2NL.There is a rent-freeperiod from 1 June 2015 to 31 December 2015. From 1 January 2016 to 31 December 2016the rent will be £4,500 per annum. From 1 January 2017 the rent will be £6,000 per annum.Theterm is 25 years from completion of the lease (expected to be 4 June 2015). This is anunderlease, as this property is held by the Principal Shareholder and Zoe Gross on a leaseholdbasis;

(g) Vulcan Works, Chesterton Road, Eastwood Trading Estate, Rotherham S65 1SU.The rent is£2,231 per month from 1 June 2015 to 31 December 2015. From 1 January 2016 to31 December 2016 the rent will be £35,150 per annum. From 1 January 2017 the rent will be£43,400 per annum. The term is 25 years from completion of the lease (expected to be 4 June2015). This is an underlease, as this property is held by the Principal Shareholder and ZoeGross on a leasehold basis.

11. Related party transactions

11.1 Details of related party transactions entered into by members of the Group during the period coveredby the financial information in Part (A) of Part III of this Document are set out in note 20 to the financialinformation set out in that part.

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11.2 Save as referred to above, there were no material related party transactions that were entered intoby members of the Group during the period covered by the financial information in Part (A) of Part IIIof this Document or during the period from 1 January 2015 to the date of this Document.

12. Working capital

The Directors are of the opinion that, having made due and careful enquiry and taking into account the netproceeds of the Placing, the Company and the Group will have sufficient working capital available for theirpresent requirements, that is, for at least the 12 months following the date of Admission.

13. Litigation and arbitration

No member of the Group is, nor has at any time in the 12 months immediately preceding the date of thisDocument been, involved in any governmental, legal or arbitration proceedings, and the Company is notaware of any governmental, legal or arbitration proceedings pending or threatened by or against any memberof the Group, nor of any such proceedings having been pending or threatened at any time in the 12 monthsimmediately preceding the date of this Document, in each case which may have, or have had in the recentpast, a significant effect on the Company’s and/or the Group’s financial position or profitability.

14. Mandatory bids, squeeze-out and sell-out rules relating to the Shares

14.1 Mandatory bids

Rule 9 of the Takeover Code provides that, except with consent of the Takeover Panel, when (a) anyperson acquires, whether by a series of transactions over a period of time or not, an interest in shareswhich (taken together with shares in which persons acting in concert with it are interested) carry30 per cent. or more of the voting rights of a company; or (b) any person, together with personsacting in concert with it, is interested in shares which in the aggregate carry not less than 30 per cent.of the voting rights of a company but does not hold shares carrying more than 50 per cent. of suchvoting rights and such person, or any person acting in concert with it, acquires an interest in anyother shares which increases the percentage of shares carrying voting rights in which it is interestedthen, in either case, that person, together with persons acting in concert with it, is normally requiredto extend offers in cash, at the highest paid price paid by it (or any persons acting in concert with it)for shares in the company within the preceding 12 months, to the holders of any class of equity sharecapital whether voting or non-voting and also to the holders of any other class of transferablesecurities carrying voting rights.

14.2 Squeeze-out

Under the Act, if a “takeover offer” (as defined in section 974 of the Act) is made for the OrdinaryShares and offeror were to acquire, or unconditionally contract to acquire, not less than 90 per cent.in value of the Ordinary Shares to which the takeover offer relates (the “Takeover Offer Shares”) andnot less than 90 per cent. of the voting rights attached to the Takeover Offer Shares within threemonths of the last day on which its offer can be accepted, it could acquire compulsorily the remaining10 per cent. It would do so by sending a notice to outstanding Shareholders telling them that it willacquire compulsorily their Takeover Offer Shares and then, six weeks later, it would execute a transferof the outstanding Takeover Offer Shares in its favour and pay the consideration to the Company,which would hold the consideration on trust for outstanding Shareholders. The consideration offeredto the Shareholders whose Takeover Offer Shares are acquired compulsorily under the Act must, ingeneral, be the same as the consideration that was available under the takeover offer.

14.3 Sell-out

The Act also gives minority Shareholders a right to be bought out in certain circumstances by anofferor who has made a takeover offer. If a takeover offer related to all the Shares and at any timebefore the end of the period within which the offer could be accepted the offeror held or had agreedto acquire not less than 90 per cent. of the Shares to which the offer relates, any holder of Shares towhich the offer related who had not accepted the offer could by a written communication to the offerorrequire it to acquire those Shares. The offeror is required to give any Shareholder notice of his rightto be bought out within one month of that right arising. The offeror may impose a time limit on the

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Ann III, 4.9

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rights of the minority Shareholders to be bought out, but that period cannot end less than threemonths after the end of the acceptance period. If a Shareholder exercises his or her rights, the offeroris bound to acquire those Shares on the terms of the offer on such other terms as may be agreed.

15. General

15.1 The gross proceeds of the Placing are expected to be approximately £1,500,000. The total costsand expenses relating to Admission and Placing are expected to be approximately £450,000(excluding value added tax) all of which are payable by the Company.

15.2 Crowe Clark Whitehill LLP has given and has not withdrawn its written consent to the issue of thisDocument with the inclusion in it of its reports as set out in Part III of this Document in the form andcontext in which each appears and has authorised its reports at Parts (A), (B) and (C) of Part III of thisDocument for the purposes of Schedule Two of the AIM Rules.

15.3 Northland has given and has not withdrawn its written consent to the issue of this Document withthe inclusion in this Document of its name in the form and context in which it is included.

15.4 The financial information set out in this Document relating to the Group does not constitute statutoryaccounts within the meaning of section 434 of the Act.

15.5 The Company’s auditor is Crowe Clark Whitehill LLP, whose registered office is St Bride's House,10 Sailsbury Square, London EC4Y 8EH. Crowe Clark Whitehill LLP has audited, without qualification,the Company’s consolidated accounts for the three year financial period ended 31 December 2014,in accordance with generally accepted auditing standards in the UK. Crowe Clark Whitehill LLP is amember firm of the Institute of Chartered Accountants in England and Wales.

15.6 There are no arrangements in place under which future dividends are to be waived or agreed to bewaived.

15.7 Whilst there are no provisions in the memorandum of association of the Company or the Articles thatrequire disclosure of shareholding ownership, the DTRs require a member to notify the Company ifthe voting rights held by such member (including by way of certain financial instruments) reach,exceeded or fall below 3 per cent. and each 1 per cent. threshold thereafter up to 100 per cent.Under the DTRs, certain voting rights in the Company may be disregarded.

15.8 Other than the current application for Admission, the Shares have not been admitted to dealings onany recognised investment exchange nor has any application for such admission been made orrefused nor are there intended to be any other arrangements for dealings in the Shares.

15.9 Save as disclosed in this Document, the Directors are not aware of any exceptional factors whichhave influenced the Group’s activities.

15.10 Employees

(a) As at 31 December 2014, being the last date of the financial period covered by the informationset out in Part III of this Document, the Group employed the following numbers of employeesin the following functions:

Function Number

Head office / administration 10Selling and distribution 28Total 38

(b) On average the Group used the services of 10 temporary employees during the financial yearended 31 December 2014.

15.11 Save as disclosed in this Document, there has been no significant change in the trading or financialposition of Lureflash since 31 December 2014, being the date to which the audited financialinformation contained in Part (A) of Part III of this Document was prepared.

Ann I, 21.2.7

Ann I, 2.1Ann I, 9Ann III, 10.3

Ann III, 8.1

Ann I, 20.9

81

15.12 Save as disclosed in this Document, there has been no significant change in the trading or financialposition of the Company since 30 August 2014, being its date of incorporation.

15.13 Save as disclosed in this Document, no person (excluding the Company’s professional advisers detailsof whom are disclosed elsewhere in this Document and trade suppliers) in the 12 months precedingthe Company’s application for Admission received, directly or indirectly, from the Company or hasentered into any contractual arrangements to receive, directly or indirectly, from the Company on orafter Admission any of the following:

(a) fees totalling £10,000 or more;

(b) securities in the Company with a value of £10,000 or more calculated by reference to thePlacing Price; or

(c) any other benefit with a value of £10,000 or more at the date of Admission.

15.14 The Shares have not been sold, nor are they available, in whole or in part, to the public in conjunctionwith the application for Admission.

15.15 As described in paragraph 2.5 above, statutory rights of pre-emption have been disapplied in order:(a) to permit the Directors to allot (i) the Placing Shares for which subscribers are being procured byNorthland pursuant to the Placing; and (ii) the Northland Options and the Share Option Plans; (b) topermit the Directors to allot Shares for cash in connection with rights issues and other pre-emptiveoffers but otherwise limited to an amount equal to 20 per cent. of the Enlarged Share Capital; and (d)to give the Directors flexibility in connection with rights issues.

Dated: 29 May 2015

Ann III, 4.5

82

Perivan Financial Print 234220