INVESTOR FAQ FACT SHEET Software for Healthcare Ltd This FAQ has been composed to help potential investors cut to the chase in terms of corporate structure, investment opportunity, tax set up and other questions you may need answers to before you invest in the business. Software for Healthcare is a company registered in Scotland ad eligible for SEIS. We have secured an initial £50,000 seed corn capital for 3.38% and are seeking a further £50,000 for 2.5% (a total of 5% equity that will not dilute during the first round of funding / of which we are seeking £1m for 35% as set out in the CAP Table below)

1. DOES THIS INVESTMENT QUALIFY FOR SEIS TAX RELIEF? Introduction For its investors to be able to claim and keep the Seed Enterprise Investment Scheme (SEIS) tax reliefs relating to their shares, the company which issues the shares has to meet a number of requirements. Some of these apply only at the time the relevant shares are issued. Others must be met continuously, either for the whole of the period from date of incorporation to the third anniversary of the date of issue of the shares, or in some cases, from date of issue of the shares to the third anniversary of their issue. If the company ceases to meet one or more of those conditions, investors may have their tax relief withdrawn. Finally, there are requirements as to how the company must use the monies it has raised via the issue of relevant shares. Requirements to be met at the time of issue of the shares The company must be unquoted at the time of issue of the shares. That means its shares cannot be listed on the London Stock Exchange or any other recognised stock exchange. It may become quoted later without the investors losing tax relief, but not if there were arrangements for it to become quoted in existence when the shares were issued. For Seed Enterprise Investment Scheme (SEIS) rules the Alternative Investment Market and the PLUS Markets (with the exception of PLUS-listed) are not considered to be recognised exchanges, so a company listed on those markets can raise money under the SEIS if it satisfies all the other conditions. The PLUS-listed market is regarded as a recognised stock exchange and shares listed on that market at the time of issue will not qualify for SEIS. The company does not fall within the above exclusion. It must have fewer than 25 employees. If the company is the parent company of a group, that figure applies to the whole group.

SOFTWARE  FOR  HEALTHCARE  LIMITED  CAP  TABLE  Ordinary  shares  of  £0.01  each  Investor           Investment      Price  per  share      Shares  subscribed      %age  at  issue      %age  fully  diluted    Andrew  Grant                    12,825          100%                64.13%  Investor1     49,950     74.00                675            5%                  3.38%  Investor2     50,000     100.00              500            4%                  2.50%  Phase  2     250,000   125.00              2,000          13%                    10.00%  Phase  3     650,000   162.50              4,000          20%                    20.00%           999,950                20,000                        100.00%  

The company does not fall within the above exclusion. It must have no more than £200,000 in gross assets. If the company is the parent company of a group, that figure applies to the total gross assets of the company and its subsidiaries. Shares in, and loans to, subsidiaries, are ignored for this purpose. The company does not fall within the above exclusion. The company must not have had any investment from a Venture Capital Trust, or issued any shares in respect of which it has submitted an Enterprise Investment Scheme (EIS) compliance statement. The company does not fall within the above exclusion. The company is restricted as to the amount of money it may raise under SEIS. It may not receive more than £150,000 in total under the scheme. That figure of £150,000 must also take account of any other State Aid received by the company in the 3 years preceding the relevant share issue which is de minimis aid according to EU regulations. (HMRC would not expect this to be common and if the company has had any such de minimis State Aid it will have been advised accordingly by the body responsible for administering that aid). If the relevant issue of shares takes the total over £150,000, then the excess will not qualify for relief. The company does not fall within the above exclusion. The proposed investment at Phase 1 is within the SEIS scheme limit. Above the threshold investments may qualify for EIS relief which is less attractive than SEIS. Any trade being carried on by the company at the date of issue of the relevant shares, must be less than 2 years old at that date. That condition applies whether the trade was first begun by the company, or whether it was first begun by another person who then transferred it to the company. (The company need not have started trading when it issues the shares). The company does not fall within the above exclusion. The company must not have carried on any other trade before it started to carry on the new trade. The company does not fall within the above exclusion. Requirements to be met continuously from date of incorporation The company must not be controlled by another company or another company and any person connected with it, and there must be no arrangements in place for it to be controlled by another company. However, if for genuine commercial reasons a company needs to put a new holding company above itself, it may do so without investors losing tax relief subject to certain conditions. The conditions are the same as those which apply for EIS. The balance of the shares (65%) will be held by David Andrew John Grant personally and will be transferred to Andrew’s holding company, AppAdVenture at a suitable time in the interests of all parties. With effect for shares issued on or after 6 April 2013, any on-the-shelf period will be ignored when determining whether a company is or has been under the control of any other company. ‘On-the-shelf period’ means a period during which the company has not issued any shares other than subscriber shares and has not yet begun or prepared to begin trading. The company does not fall within the above exclusion. It must not be a member of a partnership.

The company does not fall within the above exclusion. The company may have subsidiaries, but if it does they must all be subsidiaries in which the company has more than 50% of the ordinary share capital and which are not controlled (by other means) by any other company. The company does not fall within the above exclusion. The company may not control another company which isn’t a qualifying subsidiary, and there must be no arrangements in place which would allow that to happen. The company does not fall within the above exclusion. Requirements to be met continuously from date of issue of shares The company must be UK resident, or have a permanent establishment in the UK. The company does not fall within the above exclusion. If a single company, it must exist wholly for the purpose of carrying on a qualifying trade. If it is the parent company of a group, the group’s business is looked at as though it were one business which must, in the main, meet the requirements of the scheme. The company does not fall within the above exclusion. There is no requirement that the company or group must begin a qualifying trade within any specified period of time. However the company issuing the shares should be clear about what the intended qualifying trade is, and that should be apparent from the use to which the monies raised by the relevant share issue are put. See below regarding excluded activities. How the money raised by the relevant share issue must be used Within 3 years of the date of the relevant share issue, all the monies raised by that issue must be spent for the purposes of a qualifying business activity, carried on either by the issuing company or by a 90% subsidiary. If this condition is not met, investors will lose their tax relief. The condition will be considered to be met if an insignificant amount is used for a non-qualifying purpose, or remains unspent. The company does not fall within the above exclusion, provided it follows the business plan as it is set out. Monies raised by a share issue are not regarded as being spent for a qualifying business activity if they are used to buy shares or stock in a company. This does not prevent the issuing company from investing the monies in a subsidiary, providing that the monies are thereafter used by a 90% subsidiary for the purposes of a qualifying business activity. The company does not fall within the above exclusion. The payment of dividends to shareholders is not regarded as being for the purposes of a qualifying business activity. The company does not fall within the above exclusion, provided it follows the business plan as it is set out. A qualifying business activity is either: •carrying on a new qualifying trade (see requirements to be met at the time of issue of the shares for what is meant by a ‘new’ trade)

•the activity of preparing to carry on a new qualifying trade which the company intends to, and begins to carry on •carrying on research and development which will lead to or benefit a new qualifying trade The company would meet this requirement if it follows the business plan as set out. Qualifying trades A qualifying trade is one which is conducted on a commercial basis with a view to the realisation of profit. The company would meet this requirement if it follows the business plan as set out. Most trades qualify, but some do not. A trade does not qualify if it consists wholly, or substantially, of ‘excluded activities’. HMRC won’t regard activities as ‘substantial’ unless they are more than 20% of the whole. The following activities are excluded:

• dealing in land, in commodities or futures in shares, securities or other financial instruments

• dealing in goods, other than in an ordinary trade of retail or wholesale distribution • financial activities such as banking, insurance, money-lending, debt-factoring, hire-

purchase financing or any other financial activities • leasing or letting assets on hire, except in the case of certain ship-chartering activities • receiving royalties or licence fees (though if these arise from the exploitation of an

intangible asset which the company itself has created, that is not an excluded activity) • providing legal or accountancy services • property development • farming or market gardening • holding, managing or occupying woodlands, any other forestry activities or timber

production • shipbuilding • coal production • steel production • operating or managing hotels or comparable establishments or managing property

used as an hotel or comparable establishment • operating or managing nursing homes or residential care homes, or managing

property used as a nursing home or residential care home • generating or exporting electricity which will attract a Feed-in Tariff, unless generated

by hydro power or anaerobic digestion, or unless carried on by a community interest company, a co-operative society, a community benefit society or a Northern Irish industrial and provident society

• providing services to another person where that person’s trade consists, to a substantial extent, of excluded activities, and the person controlling that trade also controls the company providing the services

As far as I can see, if the company follows the business plan as set out, the company does not fall within any of the above excluded activities. 2. WHEN DO YOU NEED THE SEED CORN INVESTMENT BY?

The timescales for the investment as set out in the CAP Table is as follows (we would request investors are sensitive to our cash flow, and ensure cash is in our account within 5 working days of agreement being made) Phase1 £100,000 by end June 2015 Phase2 £250,000 by start Aug 2015 Phase3 £650,000 by end October 2015

3. WHAT HAPPENS TO THE ORIGINAL INVESTMENT IF YOU ARE UNABLE TO COMPLETE THE NECESSARY FUNDING? You lose your cash, but as you are the first guy(s) in, you qualify for 50% SEIS tax relief and you have also got an uplift on the value of the shares due to this.

4. WILL THE SEED CORN INVESTORS, AND THOSE TAKING THE GREATEST RISK, BE TREATED THE SAME AS THE LATER (LARGER) INVESTORS? There are no benefits beyond; the SEIS relief at 50% (not 30%), the uplift in the valuation of the shares and the ability input and play a pivotal role at the embryonic stages of this (and going down in history as the founding investor(s)

5. WILL THERE BE DIFFERENT CLASSES OF INVESTORS? FOR EXAMPLE, PREFERENCE SHARES FOR THE EARLY INVESTORS? No, there will be only one class of share issued.

6. IF THERE ARE BANK BORROWINGS WHO WILL ACT AS BANK GUARANTORS? There is no requirement for borrowing.

7. IN START UPS THE CASH FLOW SITUATION USUALLY REQUIRES MONTHLY RATHER THAN QUARTERLY MEETINGS Cl 6.3 of the Standard Shareholders Agreement says 8 board meetings per year / we would expect four of these to be face to face and four to be conference calls. Location of Board meetings will be agreed with investors from: Inverness / Glasgow / London / Berlin / Barcelona TBA. In addition Andrew Grant has set up https://www.tumblr.com/blog/hospitalschedulingapp, which is a password-protected blog. Andrew will update this blog once a month with a full management report on the progress of the project. It will include management accounts, tech updates (and links to design and app work), key partner and contract updates, clinical trial info and sales & marketing information. There will also be a feature for investors to openly post comments and submit private questions.

8. WHAT IS GOING TO BE THE PROPOSED BOARD MAKE UP? There will be four Board Members of which one will be Andrew Grant and the other Torsten Beutlhauser, the other two places will be filled by one investor and one member appointed by Andrew Grant

9. WHAT DECISIONS, IF ANY, ARE GOING TO BE LEFT TO THE SHAREHOLDERS? Examples of these are set out in Part 3 of the Schedule to the SSA and clause 7 explains that these are ‘reserved matters’ for a certain 70% of the shareholders. These matters would exclude day to day and management issues and be reserved for key strategic calls and matters that have an dramatic impact on the finances of the company

10. WHAT ISSUES NEED BOARD APPROVAL? Raising additional funding and finance, any bank borrowing, agreement for contracts that have a strategic impact (i.e. new clinical trial partners), sign off of a change in strategic direction or a decision that is in contrast to the business plan, geographical territories, Board appointments and dividend policy.

11. WHAT IS THE EXIT PLAN FOR THE SEED CORN INVESTORS? There isn’t an exit plan written into the documents because we don’t know yet. However we foresee exit points at the commercialisation of the project (Oct 2016), there may be a second round of funding required at year 2 (£5m+ to tackle the USA market), we also intend to develop additional apps with our partner hospitals which may require additional funding, we may be approached by SAP or a Pharma to buy in or sale and there is M&A or IPO 5-10 years.

12. I WOULD EXPECT DILUTION TO BE COVERED IN THE SHAREHOLDERS AGREEMENT. OTHERWISE THE SEED CORN INVESTORS (FUNDING THE TRIAL) WILL BE SWAMPED BY THOSE FUNDING THE SUBSEQUENT ROLL OUT All shareholders are protected from dilution by virtue of Article 4, by this we mean that the % equity you are sold as part of Phase1 (£1m) will be what you get by the end of Phase1 funding round. Beyond that we will need to get investors to waive this as the new investors come in, or offer

you/existing shareholders the ability to also invest pro rata to their holding so as to maintain their % holding.

13. WHAT ARE THE PLANS FOR "DRAG ALONG" OR "TAG ALONG"? - DRAG ALONG FORCE THE MINORITY SHAREHOLDERS TO DO A DEAL DECIDED UPON BY THE MAJOR SHAREHOLDERS WHILST TAG ALONG PROTECTS MINORITY SHAREHOLDERS

1. Tag if one or more shareholders of App Ad Venture sell their shares to a 3rd party (i.e. not an existing shareholder), so that the person acquiring the shares has a controlling interest as a result (i.e. >50%), then the other non-selling shareholders are allowed to participate in this sale, i.e. to ‘tag along’ and sell their shares too, on the same terms, to that 3rd party. 2. Drag if shareholders who together hold a certain % of shares in the company wish to sell their shares to a third party for value, then they can force the non-selling shareholders to sell their shares too (on terms no less favourable). The % for triggering a Drag is 75%.

14. IS THERE ANY DEADLOCK RESOLUTION PROPOSED? No, it’s not prudent to set this in stone unless you are very clear that both parties have equally deep pockets in terms of ability to buy out the other one in the case of deadlock. Only usually seen on 50/50 JV scenario, not appropriate here.

15. IS THERE ANY DIVIDEND POLICY OR REWARD FOR SHAREHOLDERS AT ANY STAGE? No.

16. HOW WILL LIABILITIES BE MET? AS A % OF THE SHAREHOLDINGS OR IN EQUAL SHARES? You are only ‘at risk’ up to the value of the investment you put in. The liabilities will be met by the company out of its available funds. If the company cannot meet liabilities and is insolvent, it will be wound up and investors will lose their investment (less SESI / EIS tax relief), no more.

17. WHAT HAPPENS ON WINDING UP? See Article 3.,1 on return of capital- any remaining assets are distributed pro rata once declared but unpaid dividends have been paid.

18. WHAT CONTROLS OF THE EXECUTIVE ARE THERE PUT IN PLACE BY THE BOARD? Schedule 4 of the SSA contains restrictive covenants which stop Andrew Grant working in competition with the company.

19. YOU ARE GETTING £230,000+ WORTH OF GRANTS FROM SCOTTISH ENTERPRISE, IF THINGS TURN SOUR DO THESE NEED PAID BACK? With the exception of a £5,000 grant from Invest in Renfrewshire (which only needs paid back if we move our base outside of Paisley in next 2 years) none of the grants need re-paid. Note we plan to locate our global tech support for apps in Paisley due to RSA grants, close link to airport and international routes and access to quality local talent in Paisley and Glasgow.