£1.5m Convertible Loan Note Agreement

1 July 2021

THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION AS DEFINED IN ARTICLE 7 OF THE MARKET ABUSE REGULATION NO. 596/2014 ("MAR") WHICH IS PART OF UK LAW BY VIRTUE OF THE EUROPEAN UNION (WITHDRAWAL) ACT 2018, AS AMENDED. UPON THE PUBLICATION OF THIS ANNOUNCEMENT, SUCH INSIDE INFORMATION IS NOW CONSIDERED TO BE IN THE PUBLIC DOMAIN

Westminster Group Plc

('Westminster', the 'Group' or the 'Company')

£1.5m Convertible Loan Note Agreement

Westminster Group Plc (AIM: WSG), a leading supplier of managed services and technology-based security solutions worldwide, is pleased to announce that it has entered into an agreement for a Convertible Loan Note ("CLN") facility with Pantheon A Family Office Limited (the "Lender") to raise up to £1.5 million for ongoing specific contract financing and working capital.

Under the terms of CLN, which has a term of three years (the "Term"), the Company will issue 10 £100k freely transferable notes to draw down £1 million immediately, with a further £500k available at the Company's request and Lender's discretion. The Company will pay a 10% coupon per annum, payable monthly on funds drawn down, but with an initial six-month deferment of interest payments. The Lender has the right to convert the principal amount of the notes into ordinary shares of 0.1p each in the capital of Westminster ("Ordinary Shares"), in multiples of £100k at any time after 12 months from drawdown, at a fixed conversion price of 3p per share (representing a premium of approximately 22.45% to the middle-market closing price on 28 June 2024), subject to orderly market arrangements on any subsequent disposals.

The value of outstanding CLNs will be secured by a debenture subordinate to any charge created by the Company's UK lending banks. Any outstanding CLNs at the end of the Term will be repaid in cash. The CLN contains market standard terms and covenants for such a project financing facility linked to the financing of specific projects. Upon conversion the Lender will enter into a Management Agreement with the Company under which the Lender agrees to support reasonable recommendations and decisions of the Board and if there are any outstanding CLNs the Company has agreed not to issue further new Ordinary Shares without the Lender's approval, with such approval not to be unreasonably withheld.

The Company was advised on the transaction by Pantheon International Advisors ("Pantheon") and under the terms of its engagement, Pantheon will receive a cash commission fee of 6% of funds drawn down under the facility, deferred for six-months. Pantheon will also receive 1 million warrants over Ordinary Shares with an exercise price of 10p each for a term of three years.

Peter Fowler, Chief Executive of Westminster, said:

"We have previously announced that the Company had engaged with specialist corporate advisors to secure project-based debt capital to assist in the delivery of the Company's opportunities and contract awards. I am delighted, therefore, to secure this funding from the investor concerned who has been extremely supportive of Westminster's business model and shares the board's belief in the Company's growth prospects."  

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Notes:

Westminster Group plc is a specialist security and services group operating worldwide via an extensive international network of agents and offices in over 50 countries.

Westminster's principal activity is the design, supply and ongoing support of advanced technology security solutions, encompassing a wide range of surveillance, detection (including Fever Detection), tracking and interception technologies and the provision of long-term managed services contracts such as the management and running of complete security services and solutions in airports, ports and other such facilities together with the provision of manpower, consultancy and training services. The majority of its customer base, by value, comprises governments and government agencies, non-governmental organisations (NGO's) and blue-chip commercial organisations.

The Westminster Group Foundation is part of the Group's Corporate Social Responsibility activities. www.wg-foundation.org

The Foundation's goal is to support the communities in which the Group operates by working with local partners and other established charities to provide goods or services for the relief of poverty and the advancement of education and healthcare particularly in the developing world.

The Westminster Group Foundation is a Charitable Incorporated Organisation, CIO, registered with the Charities Commission number 1158653.