Company Announcements

15 March 2023

Fiinu Plc

("Fiinu", the "Company" or the "Group")

Fundraising, Issue of Equity, Related Party Transactions and TVR

Fiinu (AIM: BANK), a fintech company including the fully owned Fiinu Bank Limited, creator of the Plugin Overdraft®, announces that it has conditionally raised up to £6.49 million, before costs, ("Fundraising") in new equity funding ("New Ordinary Shares") subject, inter alia, to admission of the New Ordinary Shares to trading on the AIM Market of the London Stock Exchange ("Admission").

This Fundraising is split into three components:

·    An immediate subscription ("Subscription") of 3,846,155 New Ordinary Shares at an issue price of 13 pence per New Ordinary Share to new and existing shareholders to raise approximately £0.5 million;

·    The proposed conversion of the existing £2.49 million loan facility with Dewscope Limited ("Dewscope") ("Dewscope Loan"), of which £1.99 million remains undrawn, into up to 19,153,847 New Ordinary Shares, at a price of 13 pence per New Ordinary Share. This conversion, which is by way of a further agreement with Dewscope entered into on 14 March 2023, is expected to occur in tranches following draw down, at the Company's option, between now and the end of June 2023; and

·    £3.5 million draw down from a new three year share subscription facility agreement  ("Subscription Facility"), with GEM Global Yield LLC SCS and GEM Yield Bahamas Limited (together "GEM"), which has a total maximum draw down potential of up to £40.0 million, at a price per New Ordinary Share determined on the date of subscription, but with  a condition in respect of this initial £3.5 million draw down that the issue price must not fall below 10p per New Ordinary Share, therefore the maximum number of New Ordinary Shares that could be issued to GEM pursuant to the initial draw down is 35,000,000. It is expected that this issue of New Ordinary Shares to GEM and Admission, will take place in early May 2023.

The New Ordinary Shares issued in respect of the Subscription and conversion of the Dewscope Loan will be issued with new three-year warrants ("Warrants") that are exercisable at 20 pence per share into new ordinary shares in the Company at the ratio of 1 Warrant for every 19 New Ordinary Shares issued by the Company (making a total of up to 1,210,526 Warrants). These Warrants expire, unless exercised, three years after being issued, will not be admitted to trading on AIM (although the underlying ordinary shares upon exercise shall be) and may be re-priced in certain circumstances during the three-year period.

In consideration of entering into the Subscription Facility, the Company has issued 17 million warrants to GEM ("GEM Warrants") with an expiry date of 15 March 2026, that are exchangeable into new ordinary shares with an exercise price of 20 pence per share. The GEM Warrants (which will not be admitted to trading on AIM, although the underlying ordinary shares upon exercise shall be) are transferable at GEM's option and may be re-priced in certain circumstances during the three-year period.

Further details of all these arrangements are set out below.

This Fundraising, which forms part of the Company's anticipated further funding requirements announced on 26 January 2023, will be drawn down between now and the end of June 2023, subject to Admission. All the New Ordinary Shares issued will rank pari passu with existing shares (save for the Warrants and GEM Warrants above) and will rank as qualifying CET1 regulatory capital. Further announcements will be made as New Ordinary Shares are issued and Admission occurs.

The proposed Fundraising and regulatory capital plan has been shared with the Prudential Regulation Authority ("PRA"^[1]).

Commenting on the Fundraising, Chris Sweeney, CEO of Fiinu, said:

"As we progress through the next phase of our mobilisation plan, this initial tranche of the overall funding requirement previously outlined, further de-risks the business as it executes on its plans for its subsidiary, Fiinu Bank Limited, to become a fully licenced bank which is anticipated to take place in summer 2023, subject to regulatory approval and funding. We are thankful to Dewscope, GEM and to all our investors for their continued support."

Further Information on the Subscription

The Company has agreed to issue 3,846,155 New Ordinary Shares at an issue price of 13 pence per New Ordinary Share to new and existing shareholders to raise approximately £0.5 million. The New Ordinary Shares, will be issued with 1 Warrant for every 19 New Ordinary Shares issued by the Company with an exercise price of 20p per new ordinary share. These Warrants (approximately 202,429) expire, unless exercised, three years after being issued and will not be admitted to trading on AIM (although the underlying ordinary shares upon exercise shall be).

In respect of the Warrants, on the first anniversary of the Subscription, if the share price of the Company is less than 90% of the exercise price of 20 pence, the original exercise price can be adjusted to a figure equating to 110% of the market price prevailing at that time. In addition, the exercise price of the Warrants and the number of warrant shares can be adjusted from time to time in a limited number of circumstances, such as a change in the nominal value of the Company's ordinary shares, further issues of ordinary shares, bonus issues or capital distributions.

Up to 3 million New Ordinary Shares have been placed with clients of Intrinsic Capital LLP, where Mark Horrocks (a former Director of the Company and owner of Dewscope) is both a partner and a client. As part of the Subscription, Mr Horrocks will subscribe for 1,457,693 New Ordinary Shares.

Further information on the Dewscope loan conversion

On 15 June 2022, the Company entered into an unsecured facility agreement ("Dewscope Loan Agreement") with Dewscope (a company of which Mark Horrocks is a director and is an indirect beneficiary), pursuant to which Dewscope agreed to make available a loan facility of up to £2.49 million for a period of two years (the "availability period"). The Company agreed to pay Dewscope an arrangement fee in cash of 2% of the maximum facility amount and 3% on each tranche draw down with a minimum tranche size of £250,000. The Company is entitled to draw down amounts under this facility at its discretion on notice to Dewscope. Interest is payable on amounts drawn down at a rate of 12.5% per annum, paid monthly in arrears. The facility is unsecured.

On 15 November 2022, £500,000 of the Dewscope Loan was drawn down by the Company.

On 14 March 2023, the Company entered into a further agreement with Dewscope ("Conversion Agreement") that allows for the Company to elect to convert all or part of the £2.49 million of the Dewscope Loan into New Ordinary Shares at a subscription price of 13 pence per New Ordinary Share. If the whole amount of the Dewscope Loan was converted, the maximum number of New Ordinary Shares that could be issued to Dewscope would be up to 19,153,847 New Ordinary Shares.

In addition, new Warrants that are exercisable at 20 pence per share into new ordinary shares at a ratio of 1 warrant for every 19 ordinary shares issued by the Company, will be issued to Dewscope on conversion of the Dewscope Loan into New Ordinary Shares. The maximum number of warrants that could be issued in the event that the Company draws down upon, and then elects to convert, the entire loan facility of £2.49 million into new ordinary shares would therefore be up to approximately 1,008,097 Warrants.

In respect of the Warrants, on the first anniversary of entering into the Conversion Agreement, if the share price of the Company is less than 90% of the exercise price of 20 pence, the original exercise price can be adjusted to a figure equating to 110% of the market price prevailing at that time. In addition, the exercise price of the Warrants and the number of warrant shares can be adjusted from time to time in a limited number of circumstances, such as a change in the nominal value of the Company's ordinary shares, further issues of ordinary shares, bonus issues or capital distributions.

The Directors expect that conversion of the Dewscope Loan will occur between now and June 2023; further announcements will be made as appropriate.

By virtue of his interest in Dewscope, and participation in the Subscription, Mark Horrocks, on conversion of the Dewscope Loan, is expected to become interested in over 10% of the issued share capital of the Company and therefore in turn its fully owned group company, Fiinu Bank Limited, for which he has received FCA approval as a controller.

Related Party Transactions

As Mark Horrocks was a Director of the Company until 8 July 2022, entering into the Conversion Agreement with Dewscope, and participation in the Subscription, are related party transactions for Fiinu under AIM Rule 13 of the AIM Rules for Companies. The Directors consider, having consulted with SPARK Advisory Partners Limited, the Company's Nominated Adviser, that the terms of the Conversion Agreement and the Subscription are fair and reasonable insofar as the Company's shareholders are concerned.

Further information on the GEM Subscription Facility

On 14 March 2023, the Company entered into a share subscription facility agreement ("Subscription Facility") with GEM for a maximum commitment period of three years. Under the Subscription Facility, the Company can draw down, at its option, up to £40 million in new equity funding, to be satisfied by the issue of new ordinary shares in the Company, subject to certain conditions, including Admission, by submitting a notice detailing the funds required by the Company ("Subscription Notice").

The initial draw down, set out in this announcement, has been agreed at an amount up to £3.50 million, the Subscription Notice submitted to GEM, and will settle after a period of 30 trading days from today, being on or around 28  April 2023, subject to Admission. The number and subscription price of the New Ordinary Shares issued in return will be calculated as 90% of the average of the 30 closing bid prices at the end of that 30 day trading period, but is conditional upon the subscription price for the New Ordinary Shares in this initial Subscription Notice being not less than 10 pence per New Ordinary Share, which is the nominal value of the Company's shares, therefore the maximum number of shares that could be issued to GEM pursuant to the initial draw down is 35,000,000. As receipt of the £3.50 million remains subject to Admission, application for New Ordinary Shares to be admitted to trading on AIM will be made in due course.

In respect of future possible drawdowns from the GEM Facility, the potential number of new ordinary shares issued by the Company and the funds received as a result of each Subscription Notice are dependent upon the average volume of trading in the shares of the Company over a preceding period of 30 trading days and the average closing bid prices at the end of each 30-day trading period.

In addition, in consideration of entering into the Subscription Facility, the Company issued 17 million new warrants to GEM ("GEM Warrants") with an expiry date of 14 March 2026, that are exchangeable into new ordinary shares with an exercise price of 20 pence. The GEM Warrants (which will not be admitted to trading on AIM, although the underlying ordinary shares upon exercise will be) are transferable at GEM's option.

In respect of the GEM Warrants, on the first anniversary of entering into the Facility Agreement, if the share price of the Company is less than 90% of the exercise price of 20 pence, the original exercise price can be adjusted to a figure equating to 110% of the market price prevailing at that time. In addition, the exercise price of the GEM Warrants and the number of warrant shares can be adjusted from time to time in a limited number of circumstances, such as a change in the nominal value of the Company's ordinary shares, further issues of ordinary shares, bonus issues or capital distributions.

Whilst the Subscription Facility has a maximum drawdown capability of up to £40 million over the three-year period, there is no guarantee that the Company will raise any further money from GEM following the initial £3.50 million.

In addition, under the terms of the Subscription Facility, at no time is GEM able to own more than 10% of the issued share capital of the Company.

Further announcements will be made as appropriate.

Possible effect of the fundraise on the Issued Share Capital of the Company

When all of the transactions envisaged in this announcement have been completed, excluding the exercise and issue of all warrants, using 13 pence per New Ordinary Share as an illustration, there would be a total number of ordinary shares in issue of approximately 315,054,940. At the present time, the Company has 265,131,861 ordinary shares in issue.

Admission and Total Voting Rights

The Fundraising is subject to Admission. The Company has the authority to issue and allot the New Ordinary Shares pursuant to certain existing shareholder authorities granting such powers to the directors at the Company's General Meeting held on 20 February 2023. It is expected that Admission for the New Ordinary Shares issued and allotted in respect of the Subscription will become effective, and dealing in these New Ordinary Shares will commence, at 8.00a.m, on or about 20 March 2023.  Further announcements regarding Admission of the New Ordinary Shares in respect of the Subscription Facility and/or the Conversion Agreement will be made as appropriate.

Following Admission of the New Ordinary Shares in respect of the Subscription, the share capital of the Company will comprise 268,978,016 Ordinary Shares. The above figure of 268,978,016 may be used by shareholders as the denominator for the calculations by which they will determine if they are required to notify their interest in Fiinu under the Financial Conduct Authority's Disclosure Guidance and Transparency Rules.

Further funding requirements

As previously announced on 26 January 2023, the Company plans to raise a total of approximately £35-40 million on a staged basis commencing in the run-up to Easter through to completion in July 2023 in preparation for its anticipated exit from mobilisation and the commencement of unrestricted banking services. This Fundraising is the start of that staged funding process and management forecasts indicate that this initial funding combined with the balance of that £35-40 million total funding, when achieved, will be sufficient to resource the Company in its initial year of full banking activity assuming the grant of the unrestricted banking licence in July 2023.

Further announcements will be made regarding this process as appropriate.

Market Abuse Regulation ('MAR') Disclosure

Certain information contained in this announcement would have been deemed inside information for the purposes of Article 7 of the Market Abuse Regulation (EU) No 596/2014 ('MAR'), which is part of UK law by virtue of the European Union (Withdrawal) Act 2018, until the release of this announcement.

ENDS

About Fiinu

Fiinu, founded in 2017, is a fintech group, including Fiinu Bank^{1], which is authorised by the Prudential Regulatory Authority^[1]. Fiinu's Plugin Overdraft® is an unbundled overdraft solution which allows customers to have an overdraft with Fiinu Bank without changing their existing bank. The underlying Bank Independent Overdraft® technology platform is bank agnostic, allowing Fiinu Bank to serve all other banks' customers. Open Banking allows Fiinu's Plugin Overdraft® to attach ("plugin") to the customer's primary bank account, no matter which bank they may use. Fiinu's vision is built around Open Banking, and it believes that it increases competition and innovation in UK banking.

For more information, please visit www.fiinu.com.

^[1] Fiinu Bank Limited obtained its UK deposit-taking banking licence with restrictions from the Prudential Regulation Authority (PRA) and with the consent of the Financial Conduct Authority (FCA) in July 2022.

About GEM

GEM Global Yield LLC SCS, part of the Global Emerging Markets Group, is a $4 billion, alternative investment group with offices in Paris, New York, and Nassau (Bahamas). GEM manages a diverse set of investment vehicles and has completed over 600 transactions in 70 countries.

For more information, please visit www.gemny.com

About Dewscope Limited

Dewscope Limited is a company of which Mark Horrocks is a director and is an indirect beneficiary.

About Intrinsic Capital LLP

Intrinsic Capital LLP ("Intrinsic") is authorised by the Financial Conduct Authority to provide general financial advice and investment services across a wide range of strategies and products.