Acquisition of Parity Training

    RNS Number : 6627Z
  Xpertise Group PLC
  23 July 2008
   

    FOR RELEASE 
    7.00AM
    23 JULY 2008
    XPERTISE GROUP PLC
    ("Xpertise", "A leading provider of provider of IT training")

    Acquisition of Parity Training Limited 
    Placing of 3,250,000 Ordinary Shares of 8p each at a price of 70p per Ordinary Share
    Notice of General Meeting

    Key Points
    *     Acquisition of Parity Training Limited for £4.775 million 
    *     Placing to raise £2.275 million 
    *     New debt facility of £2.25 million
    *     Pro forma turnover of the Enlarged Group in excess of £40 million - second largest in UK market
    *     Enlarged Group will have training centres in London, Greater Manchester, Leeds,  Newcastle, the Thames Valley and the Midlands
    *     c. 700 delegate places in 65 classrooms
    *     Customers include HBOS, Computacenter, BT, Barclays, Microsoft, HMRC, Sage, Experian, EDS and two significant public sector
organisations
    *     Parity Training Limited's core offering complements Xpertise's own product and service offering
    *     £1.25 million of overheads incurred by Parity Training Limited by virtue of being a subsidiary of  Parity Group plc, will not be
incurred post acquisition
    *     Cost savings from integration, increased revenues from cross selling and winning new customers gives further optimism for the
Enlarged Group's future prospects
    *     IT Training market size estimated at £530 million in 2007 - an increased by 10.5% over 2006

    Xpertise current trading 
    * 2007 results showed substantial growth in revenue and profits and strong balance sheet. 
    * The Company paid its first dividend in April 2008
    * In July 2008 Xpertise announced strong trading in the first half of the year

    Richard Last, the Chairman of Xpertise, commenting on the acquisitions, said:

    "The Enlarged Group will have a substantial blue chip customer base, strong balance sheet, negligible net debt and good cash generation.
 The combination of the Xpertise and Parity Training businesses will put the Enlarged Group in an excellent position to service our current
and future customers and meet their IT and Professional skills training needs.
    Furthermore, I am delighted that all the directors of Xpertise are participating  in the Placing which  illustrates their confidence in
the strategy and prospects  of the Group."

    For further information:

    Richard Last, Chairman                           Mob: [phone]
    Xpertise Group plc                                   Tel: [phone]

    Simon Leathers / Charlotte Stranner
    Daniel Stewart & Company plc                 Tel: [phone]

    Brian Coleman-Smith / James Verstringhe 
    Cubitt Consulting Limited                           Tel: [phone]

    

    ACQUISITION AND PLACING STATISTICS

 Placing Price                                                             70p
 Number of Existing Ordinary Shares in issue prior to the            5,633,949
 Placing and Acquisition
 Number of Placing Shares being issued pursuant to the               3,250,000
 Placing
 Percentage of Enlarged Share Capital being issued pursuant    36.58 per cent.
 to the Placing
 Estimated gross proceeds of the Placing                            £2,275,000
 Estimated net proceeds of the Placing receivable by the            £1,675,000
 Company
 Number of Ordinary Shares in issue on Admission                     8,883,949
 Market capitalisation of the Company on Admission at the           £6,218,764
 Placing Price


    EXPECTED TIMETABLE OF PRINCIPAL EVENTS
    
 Publication date of the Admission Document                       23 July 2008
 Latest time and date for receipt of completed Forms    Noon on 24 August 2008
 of Proxy for the GM
 General Meeting                                        Noon on 26 August 2008
 Issue and allotment of the VCT Placing Shares                  28 August 2008
 Completion of the Acquisition                                  29 August 2008
 Expected commencement of trading on AIM in the                 29 August 2008
 Existing Ordinary Shares and the Placing Shares
 Delivery into CREST of the Placing Shares to be held           29 August 2008
 in uncertificated form
 Despatch of definitive share certificates in respect         5 September 2008
 of the Placing Shares to be held in certificated form
    Each of the times and dates in the above timetable are London times and are subject to change at the absolute discretion of the Company
and Daniel Stewart. The terms and definitions in this announcement are the same as defined in the Admission document published on the same
day.
      Xpertise Group plc
    Acquisition of Parity Training Limited
    Placing of 3,250,000 Ordinary Shares of 8p each at a price of 70p per Ordinary Share
    Application for admission of the Enlarged Share Capital to AIM
    Notice of General Meeting
    1    Introduction
    It was announced today that Xpertise has agreed, subject to Shareholder approval, to acquire Parity Training through its wholly owned
subsidiary, Xpertise Training, for a total consideration of £4.775 million. Parity Training offers flexible learning solutions that deliver
benefits for organisations seeking performance improvement through people. Parity Training is a subsidiary of Parity Group plc, a company
whose shares are traded on on the Official List of the London Stock Exchange. The consideration for and expenses relating to the Acquisition
are to be funded by the cash proceeds of £2.275 million together with existing cash resources of £0.85 million, and a new debt facility of
£2.25 million.
    Due to the size of the Acquisition in relation to Xpertise, the Acquisition constitutes a reverse takeover under the AIM Rules and, as
such, Xpertise is obliged to re-apply for Admission to trading on AIM. As a reverse takeover, the Acquisition requires the approval of
Shareholders for the purposes of the AIM Rules and this is being sought at the General Meeting to be held on 26 August 2008. If the
Resolutions are passed by Shareholders, it is expected that Admission will take place on 29 August 2008.
    Application will be made for the Enlarged Share Capital to be admitted to trading on AIM which is expected to take place on 29 August
2008.
    The purpose of this document is to set out the background to and the reasons for the Acquisition, to explain why the Directors consider
the Acquisition to be in the best interests of the Company and its shareholders as a whole and to recommend that you vote in favour of the
Resolutions at the EGM.
    2    Information on Xpertise and Parity Training
    Xpertise
    Xpertise is one of the UK's leading providers of authorised IT and professional training. Its aim is to help companies nationwide to
enhance the skills of their staff to become more efficient, more productive and more competitive.
    Xpertise was formed in 1994 and admitted to trading on AIM in January 1999. The company has grown both organically and via the
acquisition of complementary businesses. In January 2003 the Company acquired Power Education Limited, an IT technical training provider and
in January 2006 Xpertise acquired Watermans People and Organisational Development Limited, a provider of soft skills training.
    Xpertise has a network of training centres located in London, Thames Valley, Leeds, Greater Manchester, East Midlands and Tyne & Wear.
These centres have 45 fully equipped training rooms offering a capacity of approximately 500 delegate places. Increasingly, training is also
carried out at customer locations and by third parties. The Group has 40 full-time instructors and approximately 100 associate instructors
available to deliver training to its customers.
    Xpertise has one trading subsidiary which, although providing different training products, has one management team and a single
operating structure. All the revenue during 2007 was attributable to sales in the UK arising from the principal activity of the Xpertise
Group of the supply of IT training services.
    IT Training
    Xpertise offers over 500 IT training courses and programmes for IT professionals and developers, covering all the major areas of IT,
including: A+, Network+, C++, Checkpoint, Cisco, Citrix, ,Java, Linux/Unix, IBM, Microsoft, OO, Oracle, Redhat and Sun. Xpertise has
provided significant training programmes for customers such as Accenture, Atos, BT, Dell, EDS, Experian, HM Revenue & Customs, HSBC and
Sage.
    Xpertise has twice been named Microsoft Certified Solution Partner of the Year for Europe, Middle East & Africa and, in 2007, was named
IBM Training Reseller of the Year.
    Professional skills
    Xpertise is accredited by the ISEB to deliver ITIL service management courses and by the APM Group for the delivery of PRINCE2 project
management and MSP training.
    Soft skills
    Soft skills training includes personal development, management development, customer service training, soft skills for project managers,
team development and graduate development programmes. 'Intensive development and accreditation programmes' have been introduced to the
curriculum and The Chartered Management Institute has accredited a number of these programmes.
    Learning Services
    Learning Services, a division of Xpertise, offers clients a fully managed, tailored and bespoke service. Learning Services provides
graduate programmes, project management programmes and new technology roll-outs. A training service can include elements of blended
learning, e-learning, mentoring, seminars, skills consulting, workshops and training needs analysis. Learning Services also provides a full
managed service for those clients wishing to partially or fully outsource their learning and development functions.
    Xpertise continues to expand Learning Services and, during 2007, it delivered managed training services to a number of large
enterprises. It has delivered two new major contracts that were won at the start of 2007 for a government organisation and for
Computacenter. In addition, Learning Services won further managed training service contracts in 2007 with Experian and Sage.
    In the recent 'Top 50 IT training companies' published in May 2008, Xpertise moved up from 8th to 3rd place, as can be seen in the table
below:
    IT Skills Research - TOP 50 UK IT TRAINING PROVIDERS - 2008
 Rank  Company                      2007 Revenue  Revenue change  Rank
 2008                                         £m                  2007
 1     QA-IQ                              63.5 e              5%     1
 2     Learning Tree International          23.6              5%     2
 3     Xpertise Training                    22.3             40%     8
 4     SAP                                  21.6             10%     3
 5     IBM Training                       19.5 e              3%     4
 6     Logica                             19.2 e             16%     7
 7     Global Knowledge                   18.7 e              1%     5
 8     Parity Training                      18.6              3%     6
 9     SkillSoft                          16.5 e             17%    11
 10    Oracle University                  15.5 e             19%    12

    e estimated figures

    Parity Training
    Parity Training is one of the top ten IT training providers in the UK, with a portfolio of over 250 different courses ranging from high
level analysis and design courses for senior IT professionals through to courses for end users. Parity Training has training centres in
Central London and Leeds. With its team of some 37 full time training consultants, Parity Training trains delegates on public courses and
in-house courses tailored for clients and run throughout the UK and overseas, as well as major programmes of customised training.
    Parity Training offers flexible learning solutions that deliver benefits for organisations seeking performance improvement through
people. Parity Training offers a broad IT-related portfolio and is a market leader in the areas of Project and Programme Management, Service
Management and Business Systems Development.
    Key skills for Parity Training are PRINCE2TM, ISEB and ITIL® compliance and methodology. Parity Training's specialities are change
management training before, during and after systems implementations, skills and competency frameworks based on SFIA (Skills Framework for
the Information Age) and other recognised industry practice competency definitions including BCS (British Computer Society) and OGC (Office
of Government Commerce).
    Parity Training's "e-Books" is an online reference library which extends the learning from its portfolio of courses.
    In the recent 'Top 50 IT training companies' published in May 2008, Parity Training was in 8th place, as can be seen in the table
included in the information on Xpertise above.
    3    Market and Competition
    The IT training market in the UK is characterised by a large number of small companies and some larger businesses that are part of more
substantial organisations with diverse activities. The top 5 suppliers of IT training account for 28 per cent. of the total market and the
top 10 account for almost half the total market. The market size was estimated at £530 million in 2007 which represented an increase of 10.5
per cent. as compared with 2006.
    The Directors believe that an opportunity exists to lead the consolidation of the UK IT training market, by making carefully targeted
acquisitions at valuations enhancing shareholder value.
    4    Background to and reasons for the Acquisition
    Xpertise has publicly indicated its intention to pursue a strategy of expansion, both organically and through the acquisition of
complementary businesses. Xpertise believes it has achieved its initial organic objectives which have strengthened the business in
preparation for acquisitive growth.
    The Directors believe that the Acquisition will give Xpertise much greater critical mass in the overall IT and professional skills
marketplace and in the area of Learning Services. It will move Xpertise from 3rd position in the league table of IT training providers to
2nd and the Enlarged Group will be almost double the size, by turnover, of its nearest competitor. The Enlarged Group's objective is to be a
leading provider of project and service management in addition to its position as a leading provider of IT managed training services,
offering a broad range of accredited curricula.
    The Directors are confident about the future prospects of the Enlarged Group following the integration of the two businesses. They
believe that Parity Training has the following key attributes which make it an excellent acquisition opportunity for Xpertise:
                       1.  a blue chip customer base;
                       2.  complementary products and services;
                       3.  established presence in London and Leeds; and
                       4.  a significant opportunity to realise cost savings and synergies.
    The Acquisition will enhance Xpertise Group's market position in both professional skills (predominantly IT project, programme and
service management) and managed training services. The pro forma combined turnover of the Enlarged Group will be in excess of £40 million,
giving the business a powerful position in the provision of IT technical training, professional skills training, and managed training
services. It will also provide a platform to offer both soft skills and end-user training across the enlarged customer base. The Directors
intend to use the profile of the Enlarged Group to win additional major customers and managed training service contracts.
    The Enlarged Group will operate from training centres in London, Greater Manchester, Leeds, Newcastle, the Thames Valley and the
Midlands providing approximately 700 delegate places in over 65 classrooms. The Directors intend to build an efficient delivery schedule of
core courses for the Enlarged Group in its chosen locations. It will employ over 70 permanent trainers, over 60 sales and marketing
personnel, approximately 80 personnel in finance, operations and administration and aims to offer staff enhanced career opportunities.
    The core business objective of the Enlarged Group will be to increase combined revenues by cross selling the combined business portfolio
of courses and locations to existing customers and by winning new customers for whom size, a broad portfolio of courses and nationwide
teaching facilities are important. At the same time the Directors believe that gross margins can be improved through increased course fill
rates and trainer and classroom utilisation whilst reducing operating costs by eliminating duplicate overheads. In addition, the Directors
believe that margins can be improved by utilisation of proprietary courseware in the Enlarged Group's training curriculum.
    Following Completion, the Enlarged Group will have a key presence in the learning service sector with improved visibility of earnings
and enhanced recurring revenues from customers such as HBOS, Computacenter, BT, two significant public sector contracts, Barclays,
Microsoft, HMRC, Sage, Experian, and EDS. In 2007 the major contract values ranged from between £1 .2m to £3.6m and were of various types;
including a 3 year contract and a purchasing supply agreement.
    5    Terms of the Acquisition
    Xpertise has conditionally agreed to acquire the entire issued share capital of Parity Training. The consideration for the Acquisition
is £4.775 million, of which approximately £1.68 million will be paid using the net cash proceeds of the Placing, £0.85 million will be
satisfied by existing cash resources and £2.25 million from a new debt facility.
    6    Summary Financials
    The financial information in respect of Xpertise set out in the table below is summarised from the Company's previously published annual
accounts (available on the Company's website www.xpertise.co.uk) and the financial information in respect of Parity Training from the
statutory accounts of Parity Training, extracts of which are included in the Admission Document. Shareholders should read the full reports
and not rely solely upon the summary below.


    
    
                                 Xpertise  Xpertise  Xpertise  Xpertise  Parity Training  Parity Training  Parity Training
                                     2005      2006      2006      2007             2005             2006             2007
                                    £*000     £*000     £*000     £*000            £*000            £*000            £*000
 Year Ended 31 Dec                 UKGAAP    UKGAAP      IFRS      IFRS             IFRS             IFRS             IFRS
 Revenue                           15,274    15,949    15,949    22,294           20,164           18,406           18,625
 Operating Profit/(Loss)            (305)      (58)       279       554          (2,206)              308              570
 Add Back Share-basedpayment           27        23        23                         35               15              105
 expenses
 Adjusted EBIT (non statutory)      (278)      (35)       302       554          (2,171)              323              675
    A reconciliation, between UK GAAP and IFRS, of Xpertise's consolidated income statement for the year ended 31 December 2006 can be found
on page 44 of the Annual report and Accounts for the Year Ended 31 December 2007.
    As a result of Parity Training being divested from Parity Group and becoming part of the Xpertise Group a number of adjustments are
required to compare the adjusted EBIT of the two businesses. Most notably this includes the removal of the expected return on pension scheme
assets. Furthermore the removal of provisions associated with pensions and property can be seen on the pro forma statement of net assets in
the Admission Document.
    Cost Savings and Synergies
    It is expected that, following Completion, annual cost savings £1.25 million will be made as a direct result of the cessation of
recharges of Parity Group plc central overheads to Parity Training. The savings are comprised from a number of areas; Corporate, Legal,
Commercial, Marketing, Finance, Insurance, HR, IT, Pensions and Property.
    It is estimated that further cost savings of over £0.5 million can be achieved by reducing operating costs through the elimination of
duplicate overheads.
    Interim Results for the six months ending 30 June 2008
    As a result of management's involvement in and attention on the execution of this transaction the publication of the Interim Results is
now expected in the later half of September.
    7    Current Trading and Future Prospects of the Enlarged Group
    Xpertise
    The 2007 audited results of Xpertise showed substantial growth in revenue and profits and a strong balance sheet. Xpertise paid a
dividend for the first time since 2000 on the basis of these results.
    On 1 July 2008, the Board of Xpertise announced that trading in the first half of 2008 has continued to be strong, with revenues in
excess of £11.8 million, 11 per cent. above the same period last year. The Group's major customers have continued to contribute strongly to
this growth in revenue and the balance sheet remains strong. At 30 June 2008, the Xpertise Group had net cash balances in excess of £3m and
the Board remains comfortable with market expectation for the current financial year.
    The IT training market is reported to have increased in size by approximately 10.6 per cent. in 2007 (IT Skills Research), a year in
which Xpertise gained market share from its competitors with an increase in revenues of over 40 per cent. Notwithstanding this, training
remains price sensitive.
    Xpertise has experienced success in the professional skills sector (Prince2 project management and ITIL service management). Xpertise's
turnover in this part of its business increased by 15 per cent. in 2007.
    Xpertise's soft skills business also continues to expand and turnover in this area increased by 66 per cent. in 2007.
    Parity Training
    Parity Training's revenue remained reasonably steady during 2006 and 2007. However, quarter 1 2008 revenues were below Parity Training's
management's original expectations and led them to downgrade their forecasts for the remainder of 2008.
    Parity Training's management has made significant progress in reducing the cost base of the business and in simplifying and focusing its
product portfolio. Parity Training has a good reputation in the corporate and public sector marketplace. The business returned to marginal
profitability in 2006 but this was after incurring significant central recharges from Parity Group.
    Enlarged Group
    Parity Training's core course offering of project and programme management, service management and business systems development
complements Xpertise's own product and service offerings in this area.
    The allocation of overheads from Parity Group includes approximately £1.25 million which will not be incurred post acquisition.
    There are additional significant cost savings that can be made by the integration of Xpertise and Parity Training. This, combined with
increasing revenues both through cross selling opportunities and winning new customers as a result of the enhanced market position of the
Enlarged Group, gives the Directors optimism for the Enlarged Group's future prospects.
    8 Dividend Policy
    The Board, intends, subject to the results of the Company's operations, its financial condition, cash requirements, future prospects,
and profits available for distribution, to recommend the payment of dividends to Shareholders.
    9 Directors' Interests
    The interests of the Directors (including the interests of persons connected with them (which expression shall be construed in
accordance with section 346 of the Act) in so far as known to the Directors, having made appropriate enquiries in the issued share capital
of the Company, (all of which are beneficial interests unless otherwise stated) as at the date of the Admission Document and as they are
expected to be immediately following Admission are as follows:
      
              As at the date of the Admission          Immediately following
                          Document                            Admission

                    Number of    Percentage of          Number of    Percentage of 
 Name         Ordinary Shares   Ordinary Shares   Ordinary Shares   Ordinary Shares

 R Last              710,586             12.61%        1,120,586             12.61%
 MB Hatton           139,908              2.48%          282,765              3.18%
 IP Johnson           22,400              0.40%           93,829              1.06%
 BJ Pike               1,125              0.02%           36,839              0.41%
 WR Walker               812              0.01%           22,241              0.25%

    10 General Meeting
    The  General Meeting of the Company is to be held at the offices of Taylor Wessing LLP, Carmelite, 50 Victoria Embankment, Blackfriars,
London EC4Y 0DX at 12 noon on 26 August 2008. The following resolutions will be proposed:

    Resolution 1 is an ordinary resolution to approve the Acquisition;

    Resolution 2 is an ordinary resolution to authorise the Board under section 80 of the Companies Act 1985 to exercise all the powers of
the Company to allot, grant options over, offer or otherwise deal with or dispose of any relevant securities of the Company generally on
such terms and conditions as the directors may determine provided that such authority shall be limited to:
 
(a)                the allotment of the Placing Shares to such persons as may be entitled to receive such securities upon the terms of the
Placing as summarised in the Admission Document;
 
(b)        otherwise than as referred to in paragraph (a) above, the allotment of relevant securities up to a nominal amount of £607,975 for
a period expiring (unless previously renewed, varied or revoked by the Company in general meeting) 15 months after the date of passing the
resolution or at the conclusion of the next Annual General Meeting of the Company, whichever first occurs

    
    
    but so that, in either such case, the Company is able before such expiry to make an offer or agreement which would or might require
relevant securities to be allotted after expiry of such an authority and the directors will be authorised to allot relevant securities in
pursuance of that offer or agreement notwithstanding that the authority conferred by this resolution has expired.

    Resolution 3 is a special resolution to, conditionally upon the passing of resolutions 1 and 2 above, give the directors power (in
substitution for all such the powers previously granted) for the purposes of section 95 of the Act to allot equity securities (as defined in
section 94 of the Act) pursuant to the authorities conferred by resolution 2 above as if section 89(1) of the Act did not apply to any such
allotment provided that the power conferred by this resolution shall be limited to:

(a)        the allotment of the Placing Shares to such persons as may be entitled to receive such securities upon the terms of the Placing
as summarised in the Admission Document;
 
(b)        the allotment of equity securities in connection with or pursuant to an offer by way of rights to the holders of shares in the
company and other persons entitled to participate therein, in the proportion (as nearly as may be) to such holders* holdings of such shares
(or, as appropriate, to the number of shares which such other persons are for these purposes deemed to hold) subject only to such exclusions
or other arrangements as the directors may feel necessary or expedient to deal with fractional entitlements or the regulations or
requirements of any recognised regulatory body in any territory;
 
(c)        to the grant of options to subscribe for shares in the company, and the allotment of such shares pursuant to the exercise of
options granted, under the terms of any share option scheme adopted or operated by the company; and
 
    (d)        to the allotment of equity securities, otherwise than pursuant to sub-paragraphs (a) to (c) above, up to an aggregate nominal
amount of £142,143.



    Resolution 4 is a special resolution to authorise the Company for the purposes of section 166 of the Companies Act 1985 to make market
purchases (as defined in section 163 of the Companies Act 1985) of Ordinary Shares in the capital of the Company in such manner and on such
terms as the directors of the Company may from time to time determine, and where such shares are held as treasury shares, the Company may
use them for the purposes set out in section 162D of the Companies Act 1985, including for the purpose of its employee share schemes,
provided that:

 
(a)        the maximum number of Ordinary Shares hereby authorised to be purchased is 1,332,592;
 
(b)        the minimum purchase price which may be paid for any Ordinary Share is 8 pence (exclusive of expenses);
 
(c)        the maximum purchase price which may be paid for any Ordinary Share is the higher of (in each
case exclusive of expenses):
 
(i)                          an amount equal to 105 per cent. of the average of the middle market quotations for an Ordinary Share as
derived from the London Stock Exchange Daily Official List for the five business days immediately preceding the day on which the purchase is
made; and
(ii)                         an amount equal to the higher of the price of the last independent trade and the highest current independent
bid as derived from the London Stock Exchange*s trading system
known as SEAQ; and
 
(d)        this authority shall take effect on the date of passing of this resolution and shall (unless previously
revoked, renewed or varied) expire on the conclusion of the next annual general meeting of the Company following the passing of this
resolution or, if earlier, 15 months after the date of passing of this resolution, save in relation to purchases of Ordinary Shares the
contract for which was concluded before the expiry of this authority and which will or may be executed wholly or partly after such expiry.
 

    11 Recommendation
    The Directors consider the Proposals to be fair and reasonable and in the best interests of the Company and its Shareholders as a whole
and therefore recommend the Shareholders to vote in favour of the Resolutions to be proposed at the EGM, as they intend to do so in respect
of their own shareholdings, amounting in aggregate to 874,831 Ordinary Shares, representing 15.53 per cent. of the Existing Ordinary
Shares.
      DEFINITIONS
    The following definitions and glossary terms apply throughout this document, unless the context otherwise requires:
    
 *2006 Act*                                                                       the Companies Act 2006
 *Acquisition*                         the proposed acquisition by the Company of the entireissued share
                                   capital of Parity Training from the Vendorpursuant to the Acquisition
                                                                                               Agreement
 *Acquisition Agreement*           the conditional agreement between (1)Xpertise Training Limited (2)the
                                           Company(3) the Vendor and(4) Parity Group plc relating to the
                                       Acquisition, furtherdetails of which are set out in the Admission
                                                                                                Document
 *Act*                                                               the Companies Act 1985 (as amended)
 *Admission*                           admission of the Enlarged Share Capital to trading onAIM becoming
                                                effective in accordance with the AIM Rules for Companies
 *AIM*                                                       the AIM market of the London Stock Exchange
 *AIM Rules for Companies*                           the rules for AIM companies as issued by the London
 *AIM Rules for Nominated        the rules for nominated advisers as issued by theLondon Stock Exchange,
 Advisers*                                                                             from time to time
 *Company* or *Xpertise*                                                              Xpertise Group Plc
 *Completion*                         completion of the terms in accordancewith theAcquisition Agreement
 *Daniel Stewart*                                                           Daniel Stewart & Company Plc
 *Directors* or *Board*           the directors of the Company, whose names are set out in the Admission
                                                                                                Document
 *Enlarged Group*                        the Company and its subsidiaries following completionof, and as
                                                                            enlarged by, the Acquisition

    
 *Enlarged Share Capital*                    the Existing Ordinary and thePlacing Shares
 EnterpriseManagement                    the Xpertise enterprise management share option
 IncentiveShare Option Scheme*         schemeapproved by the shareholders of Xpertise by
                                 resolutiondated 18 July 2001 and described in paragraph
                                                    8 ofPart V of the Admission Document
 *Form of Proxy*                 the form of proxy enclosed with this document for useby
                                             the Shareholders in connection with the EGM
 *FSA*                                                  the Financial Services Authority
 *GM* or *General Meeting*         the general meeting of the Company,notice of which is
                                            set out at the end of the Admission Document
 *HBOS Agreement*                               the IT Technical & Desk Top Applications
                                   Trainingcontract between HBOS plc and Parity Training
                                  dated1 March 2005 as varied by a letter dated 17 April
                                 2007and renewed pursuant to a letter dated 16 June 2008
 *HMRC*                                                Her Majesty*s Revenue and Customs
 *Learning Services*             the Learning Services division of Xpertise described in
                                                                  the Admission Document
 *London Stock Exchange*               London Stock Exchange Plc, company number 2075721
 *Non-VCT Placing Shares*                 the 951,428 Placing Shares which will not form
                                     aqualifying holding for VCTs investing funds raised
                                                                       after6 April 2006
 *Notice*                           the notice of GM set out at the end of the Admission
                                                                                document
 *Official List*                                the Official List maintained by the UKLA
 *Option* or *Options*                 options to be granted pursuant to the ShareOption
                                                                                  Scheme
 *Ordinary Shares*                ordinary shares of 8p each in the share capital of the
                                                                                 Company
 *Panel*                                              the Panel on Takeovers and Mergers
 *Parity Training*                                               Parity Training Limited
 *Placees*                                subscribers for the Placing Shares procured by
                                    DanielStewart (as agent for the Company) pursuant to
                                               and on the terms of the Placing Agreement
 *Placing*                              the conditional placing of the Placing Shares by
                                         DanielStewart as agent on behalf of the Company
                                          pursuant to the terms of the Placing Agreement
 *Placing Agreement*             the conditional agreement dated 23 July 2008 betweenthe
                                              Company and Daniel Stewart relating to the
                                     Placing,further details of which are set out in the
                                                                      Admission Document
 *Placing Price*                   70 pence, being the price at which each Placing Share
                                                        isto be issued under the Placing
 *Placing Shares*                    the 3,250,000 new Ordinary Shares which are subject
                                     ofthe Placing comprising the VCT Placing Shares and
                                                               thenon-VCT Placing Shares
 *Proposals*                                  the Acquisition, the Placing and Admission
 *Prospectus Rules*                     the prospectus rules made by the FSA pursuant to
                                   section73A(1) and (3) of FSMA as defined in section 4
                                                                        17(1) ofthe FSMA
 * QCA Guidelines*                       the guidelines published on 13 July 2005 by the
                                 QuotedCompanies Alliance regarding corporate governance
                                                                        forAIM companies
 *Record Date*                     6.00 p.m. on the day prior to the publication of this
                                                                                document
 *Resolutions*                   the proposed resolutions of the Company contained inthe
                                                        Notice attached to the Admission
 *Xpertise Training*                                           Xpertise Training Limited
 *Xpertise Group*                 Xpertise Group plc and its subsidiaries as at the date
                                                                         ofthis document
 *Shareholders*                             the persons who are registered as holders of
                                                                          OrdinaryShares
 *Share Option Scheme*            the Enterprise Management Incentive Share OptionScheme
                                                  and the Unapproved Share Option Scheme
 *Takeover Code* or the *Code*                    the City Code on Takeovers and Mergers
 *UKLA* or *UK Listing             United Kingdom Listing Authority, being the FSAacting
 Authority*                               in its capacity as the competent authority for
                                                     thepurposes of Part VII of the FSMA
 *Unapproved Share Option         the Xpertise unapproved share option scheme approvedby
 Scheme*                               the shareholders of Xpertise by resolution dated4
                                   January 1999 and described at paragraph 8 of Part Vof
                                                                  the Admission Document
 *Vendor*                              the shareholder of Parity Training at the date of
                                             thisdocument, being Parity Holdings Limited
 *VCT(s)*                                                         Venture Capital Trusts
 *VCT Placing Shares*             the 2,298,572 Placing Shares which are intended toform
                                    a qualifying holding for VCTs investing funds raised
                                                                     before 6 April 2006


This information is provided by RNS
The company news service from the London Stock Exchange
 
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