Paysafe Group

THIS DOCUMENT AND ANY ACCOMPANYING DOCUMENTS ARE IMPORTANT AND REQUIRE YOUR IMMEDIATE ATTENTION. If you are in any doubt as to the action you should take, you are recommended to seek your own financial advice immediately from an independent financial adviser, who is authorised under the Financial Services and Markets Act 2000 (‘‘FSMA’’) if you are in the United Kingdom, or from another appropriately authorised independent financial adviser if you are in a territory outside the United Kingdom. This document comprises a prospectus relating to Paysafe Group plc (‘‘Paysafe’’ or the ‘‘Company’’) and has been prepared in accordance with the Prospectus Rules of the Financial Conduct Authority (the ‘‘FCA’’) pursuant to section 73A of FSMA. This document has been approved by the FCA in accordance with section 87A of FSMA and made available to the public in accordance with Rule 3.2 of the Prospectus Rules. The Ordinary Shares are currently admitted to trading on AIM. Application will be made to the FCA and to the London Stock Exchange respectively for admission of all the Ordinary Shares to: (i) the Official List; and (ii) trading on the Main Market (‘‘Admission’’). It is expected that Admission will become effective and that dealings in the Ordinary Shares on the London Stock Exchange will commence at 8.00 a.m. on 23 December 2015. The Company intends to cancel its admission to trading on AIM at this point. No application has been made or is currently intended to be made for the Ordinary Shares to be admitted to listing or dealt with on any other exchange. You should read the entire document and any information incorporated herein by reference and, in particular, the section headed ‘‘Risk Factors’’ on pages 16 to 41 of this document when considering an investment in the Ordinary Shares. All statements regarding the Paysafe Group’s business, financial position and prospects should be viewed in light of such Risk Factors. The Company and the Directors whose names appear on page 47, accept responsibility for the information contained in this document. To the best of the knowledge and belief of the Company and the Directors (each of whom has taken all reasonable care to ensure that such is the case), the information contained in this document is in accordance with the facts and contains no omission likely to affect the import of such information.

PAYSAFE GROUP PLC (incorporated and registered in the Isle of Man with registered number 109535C) Admission to the Ofﬁcial List and to trading on the London Stock Exchange’s Main Market for listed securities of 479,606,395 Ordinary Shares Deutsche Bank AG, London Branch Sponsor and Broker Lazard & Co., Limited Financial Adviser

No person has been authorised to give any information or make any representations other than those contained in this document and any such information or representations must not be relied upon as having been so authorised by the Company, the Directors, Deutsche Bank AG, London Branch (‘‘Deutsche Bank’’), Lazard & Co., Limited (‘‘Lazard’’) or any other person. Paysafe will comply with its obligation to publish supplementary prospectuses containing further updated information required by law or by any regulatory authority but assumes no further obligation to publish additional information. Each of Deutsche Bank, which is authorised under German Banking law (competent authority: BaFin-Federal Financial Supervisory Authority) and subject to limited regulation by the FCA and the Prudential Regulatory Authority (the ‘‘PRA’’) in the United Kingdom acting through its London branch and Lazard, which is authorised and regulated by the FCA in the United Kingdom, are acting exclusively for the Company and no-one else in connection with the contents of this document and Admission and will not regard any other person (whether or not a recipient of this document) as a client in relation to Admission and will not be responsible to anyone other than the Company for providing the protections afforded to respective clients of Deutsche Bank or Lazard, respectively, nor for giving advice in relation to the contents of this document or Admission or any arrangement referred to, or information contained in, this document. Apart from the responsibilities and liabilities, if any, which may be imposed on Deutsche Bank or Lazard, respectively, under FSMA or the regulatory regime established thereunder, none of Deutsche Bank or Lazard accept any responsibility whatsoever nor makes any representation or warranty, express or implied, concerning the contents of this document including its accuracy, completeness or verification or concerning any other statement made or purported to be made by Paysafe, or on Paysafe’s behalf, or by Deutsche Bank, or on Deutsche Bank’s behalf, or by Lazard, or on Lazard’s behalf in connection with the Company or Admission and nothing in this document is or shall be relied upon as a promise or representation in this respect, whether as to the past or future. Subject to applicable law, each of Deutsche Bank and Lazard disclaims, to the fullest extent permitted by applicable law, all and any duty, liability or responsibility whatsoever (whether direct or indirect, whether in contract, in tort, under statute or otherwise) which it might otherwise have in respect of this document and the matters referred to herein. Subject to FSMA, the Listing Rules the Disclosure and Transparency Rules, the Prospectus Rules, the rules of the London Stock Exchange and applicable laws, the delivery of this document shall not, under any circumstances, create any implication that there has been no change in the affairs of the Company since the date of this document or that the information in this document is correct as at any time after this date. This document does not constitute an offer to sell or an invitation to subscribe for, or the solicitation of an offer to buy or subscribe for, Ordinary Shares. The Ordinary Shares have not been, and will not be, registered under the US Securities Act or qualified for sale under the laws of any state of the United States or under the applicable laws of any other prohibited territory and, subject to certain exceptions, may not be offered for sale as subscription or sold or subscribed directly or indirectly within any Excluded Territory for the account or benefit of any national, resident or citizen of any Excluded Territory. The distribution of this document and/or the transfer of the Ordinary Shares into jurisdictions other than the United Kingdom and the Isle of Man may be restricted by law. Any failure to comply with any such restrictions may constitute a violation of the securities laws of such jurisdictions. On 15 June 2015, Moody’s announced that it was assigning a provisional ‘‘(P)Ba2’’ corporate family rating to the Company and a ‘‘(P)Ba2’’ rating to the Company’s senior secured term loan B, which forms part of the Company’s Credit Facilities and Standard & Poor’s announced that it had assigned a ‘‘BB’’ long-term credit rating to the Company and a ‘‘BB+’’ issue rating to the Company’s senior secured term loan B, which forms part of the Company’s Credit Facilities. The outlook on both ratings is stable. Moody’s and Standard & Poor’s are established in the EU and registered under Regulation (EC) No 1060/2009 (as amended) (the ‘‘CRA Regulation’’). The contents of this document and the information incorporated herein by reference should not be construed as legal, business or tax advice. Each prospective investor should consult his, her or its legal adviser, financial adviser or tax adviser for advice. Neither the Company nor any of its respective directors, employees or representatives is making any representation to any offeree or purchaser or acquirer of the Ordinary Shares regarding the legality of an investment in the Ordinary Shares by such offeree or purchaser or acquirer under the laws applicable to such offeree or purchaser or acquirer.

18 December 2015

ii CONTENTS

SUMMARY 1 RISK FACTORS 16 IMPORTANT INFORMATION 42 EXPECTED TIMETABLE OF PRINCIPAL EVENTS 46 DIRECTORS, COMPANY SECRETARY, REGISTERED OFFICE AND ADVISERS 47 PART I INFORMATION ON THE PAYSAFE GROUP 48 PART II ONLINE GAMBLING REGULATION 75 PART III OPERATING AND FINANCIAL REVIEW OF THE PAYSAFE GROUP 89 SECTION A: OPERATING AND FINANCIAL REVIEW OF THE PAYSAFE GROUP 90 FOR THE SIX MONTH PERIOD ENDED 30 JUNE 2015 SECTION B: OPERATING AND FINANCIAL REVIEW OF THE PAYSAFE GROUP 101 FOR THE THREE YEARS ENDED 31 DECEMBER 2014 PART IV FINANCIAL INFORMATION OF THE PAYSAFE GROUP 102 SECTION A: ACCOUNTANTS’ REPORT ON THE REPORTED ON FINANCIAL 103 INFORMATION OF THE PAYSAFE GROUP FOR THE SIX MONTHS ENDED 30 JUNE 2015 SECTION B: REPORTED ON FINANCIAL INFORMATION OF THE PAYSAFE 105 GROUP FOR THE SIX MONTH PERIOD ENDED 30 JUNE 2015 SECTION C: AUDITED FINANCIAL INFORMATION OF THE PAYSAFE GROUP 139 FOR THE THREE YEARS ENDED 31 DECEMBER 2014 SECTION D: ACCOUNTANTS’ REPORT ON THE AUDITED FINANCIAL 140 INFORMATION OF TK GLOBAL PARTNERS, LP (‘‘MERITUS’’) FOR THE THREE YEARS ENDED 31 DECEMBER 2014 SECTION E: AUDITED FINANCIAL INFORMATION OF TK GLOBAL PARTNERS, 142 LP (‘‘MERITUS’’) FOR THE THREE YEARS ENDED 31 DECEMBER 2014 PART V OPERATING AND FINANCIAL REVIEW OF THE SKRILL OPERATING GROUP 159 PART VI FINANCIAL INFORMATION OF THE SKRILL GROUP 179 SECTION A: ACCOUNTANTS’ REPORT ON THE REPORTED ON FINANCIAL 180 INFORMATION OF THE SKRILL GROUP FOR THE SIX MONTH PERIOD ENDED 30 JUNE 2015 AND THE AUDITED FINANCIAL INFORMATION OF THE SKRILL GROUP FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2014 SECTION B: REPORTED ON FINANCIAL INFORMATION OF THE SKRILL GROUP 182 FOR THE SIX MONTH PERIOD ENDED 30 JUNE 2015 AND THE AUDITED FINANCIAL INFORMATION FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2014 SECTION C: ACCOUNTANTS’ REPORT ON THE REPORTED ON FINANCIAL 227 INFORMATION OF THE SKRILL OPERATING GROUP FOR THE SIX MONTH PERIOD ENDED 30 JUNE 2015 AND THE AUDITED FINANCIAL INFORMATION FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2014 SECTION D: REPORTED ON FINANCIAL INFORMATION OF THE SKRILL 229 OPERATING GROUP FOR THE SIX MONTH PERIOD ENDED 30 JUNE 2015 AND THE AUDITED FINANCIAL INFORMATION FOR FINANCIAL YEAR ENDED 31 DECEMBER 2014 SECTION E: AUDITED FINANCIAL INFORMATION OF THE SKRILL OPERATING 275 GROUP FOR THE THREE YEARS ENDED 31 DECEMBER 2013

iii PART VII UNAUDITED PRO FORMA FINANCIAL INFORMATION 276 SECTION A: ACCOUNTANT’S REPORT ON THE UNAUDITED PRO FORMA 276 FINANCIAL INFORMATION SECTION B: UNAUDITED PRO FORMA FINANCIAL INFORMATION 278 PART VIII CAPITALISATION AND INDEBTEDNESS 283 PART IX DIRECTORS, SENIOR MANAGEMENT, CORPORATE GOVERNANCE AND 285 EMPLOYEES PART X TAXATION 294 PART XI ADDITIONAL INFORMATION 299 PART XII INFORMATION INCORPORATED BY REFERENCE 327 PART XIII DEFINITIONS 328

iv SUMMARY

Summaries are made up of disclosure requirements known as ‘‘Elements’’. These Elements are numbered in Sections A-E (A.1-E.7). This summary contains all the Elements required to be included in a summary for this type of security and issuer. Because some Elements are not required to be addressed there may be gaps in the numbering sequence of the Elements. Even though an Element may be required to be inserted into the summary because of the type of security and issuer, it is possible that no relevant information can be given regarding the Element. In this case a short description of the Element is included in the summary with the mention of ‘‘not applicable’’.

Section A: Introductions and Warnings

A.1 Introduction and Warning This summary should be read as an introduction to this document. Any decision to invest in the securities should be based on consideration of this document as a whole, including the information incorporated by reference into it, by the investor. Where a claim relating to the information contained in this prospectus is brought before a court, the plaintiff investor might, under the national legislation of a member state of the European Union, have to bear the costs of translating this document before the legal proceedings are initiated. Civil liability attaches only to those persons who have tabled the summary including any translation thereof, but only if the summary is misleading, inaccurate or inconsistent when read together with the other parts of this document or it does not provide, when read together with the other parts of this document, key information in order to aid investors when considering whether to invest in such securities.

A.2 Subsequent resale of securities or final placement of securities through financial intermediaries Not applicable. No consent has been given by the Company or any person responsible for drawing up this document to use this document for any subsequent resale or final placement of securities by financial intermediaries.

Section B: Issuer and any guarantor

B.1 Legal and commercial name Paysafe Group plc.

B.2 Domicile, legal form, legislation, country of incorporation The Company is a public limited company, incorporated on 31 October 2003 in the Isle of Man under the Isle of Man Companies Act 1931 to 1993 with its registered ofﬁce situated in the Isle of Man.

B.3 Current operations and principal activities and markets The Paysafe Group is a global provider of online and mobile payment processing services. In FY2014 Paysafe processed more than US$20 billion in transactions. As at the Latest Practicable Date the number of active merchants and active customers to which Paysafe provided services is as follows: NETBANXâ provided its services to over 53,600 active merchants; NETELLERâ provided its services to over 1.14 million active customers and over 1,500 active merchants; Skrill provided its services to over 2.3 million active customers and over 34,000 active merchants; and paysafecard provided its services to an estimated 12 million active customers and over 2,200 active merchants. The Paysafe Group operates ofﬁces and data centres in Europe, Canada, the Isle of Man and the United States.

B.4a Signiﬁcant recent trends affecting the Paysafe Group and its industry Paysafe acquired Skrill, one of Europe’s leading digital payments company, on 10 August 2015. Following the completion of the Skrill Acquisition, the Directors believe the Paysafe Group is a

1 leading player in the provision of digital wallets to merchants and customers. The Directors believe the Skrill Acquisition has combined the complex payment processing networks of the Paysafe Group and the Skrill Group to provide improved penetration and reach into new and existing markets, as well as accelerate the on-boarding of new merchants.

B.5 Description of the Paysafe Group The Company is the parent company of the Paysafe Group. The table below contains a list of the principal subsidiaries, joint ventures and associates of the Company (each of which is considered by the Paysafe Group to be likely to have a significant effect on the assessment of the assets, liabilities, the financial position and/or the profits and losses of the Paysafe Group):

Proportion Proportion of direct or of direct or indirect indirect Country of ownership voting Name Incorporation interest power held

Paysafe Financial Services Limited England and Wales 100% 100% Digital Payments Europe Limited England and Wales 100% 100% Paysafe Processing Limited England and Wales 100% 100% Netinvest Limited England and Wales 100% 100% Optimal Payments (UK) Limited England and Wales 100% 100% Prepaid Services Company Limited England and Wales 100% 100% MB Acquisitions Limited England and Wales 100% 100% Sentinel Holdco 2 Limited England and Wales 100% 100% Sentinel Midco Limited England and Wales 100% 100% Sentinel Bidco Limited England and Wales 100% 100% Skrill Holdings Limited England and Wales 100% 100% Skrill International Payments Limited England and Wales 100% 100% Skrill Limited England and Wales 100% 100% Smart Voucher Limited England and Wales 100% 100% NT Services Limited Canada 100% 100% 1155259 Alberta Limited Canada 100% 100% Paysafe Services (Canada) Inc. Canada 100% 100% Paysafe Technologies Inc Canada 100% 100% Paysafe Merchant Services Inc Canada 100% 100% Paysafe CallCo Inc. Canada 100% 100% Paysafe ExchangeCo Inc. Canada 100% 100% FANS Entertainment Inc. Canada 100% 100% Skrill Canada Inc. Canada 100% 100% Paysafe Merchant Services Limited Isle of Man 100% 100% Net Group Holdings Limited Isle of Man 100% 100% Paysafe Finance Limited Isle of Man 100% 100% NBX Merchant Services Corp United States 100% 100% Optimal Payments Services Inc. United States 100% 100% TK Global Partners, LP United States 100% 100% OPL Payment Services LLC United States 100% 100% Netbx Services LLC United States 100% 100% NBX Holdings Corp United States 100% 100% NBX Services Corp United States 100% 100% FANS Entertainment LLC United States 100% 100% Paysafecard.com USA, Inc. United States 100% 100% Sentinel Topco Limited Jersey 100% 100% Skrill Group Limited Jersey 100% 100% paysafecard.com Argentina S.R.L. Argentina 100% 100% Digital Payments Solutions Australia Pty Limited Australia 100% 100% paysafecard.com Wertkarten GmbH Austria 100% 100%

2 Proportion Proportion of direct or of direct or indirect indirect Country of ownership voting Name Incorporation interest power held

Paysafecard.com Wertkarten Vertriebs GmbH Austria 100% 100% Payolution GmbH Austria 100% 100% Sabemul Beteiligungsverwaltungs GmbH Austria 100% 100% cpt Dienstleistungen GmbH Germany 100% 100% Skrill Services GmbH Germany 100% 100% Optimal Payments (Bulgaria) EOOD Bulgaria 100% 100% Paysafe Bulgaria EOOD Bulgaria 100% 100% MAC Limited Gibraltar 100% 100% Skrill Hong Kong Limited Hong Kong 100% 100% paysafecard.com Me´xico S.A. de C.V. Mexico 100% 100% Digital Payments Solutions New Zealand Ltd New Zealand 100% 100% Skrill Singapore Ptc. Limited Singapore 100% 100% Paysafecard.com Schweiz GmbH Switzerland 100% 100% paysafard.com o¨n o¨deme servicleri limited s¸irketi Turkey 100% 100% B.6 Notiﬁable interests, different voting rights and controlling interests As at the Latest Practicable Date, the interests of the Directors and persons connected to them as notiﬁed to the Company in accordance with the Articles are as follows:

Percentage Number of of Ordinary Ordinary Share Name Shares capital

Dennis Jones — — Joel Leonoff 6,002,926(1) 1.25 Brian McArthur-Muscroft — — Andrew Dark — — Ian Francis — — Brahm Gelfand 12,000 0.00 Ian Jenks — —

(1) This includes the 1,500,000 Ordinary Shares pledged by Mr Leonoff in favour of Equities First Holdings, LLC As at the Latest Practicable Date, in addition to those persons described above, the Company had been notiﬁed of the following persons who are directly or indirectly interested in 3 per cent. or more of the issued ordinary share capital of the Company:

Percentage Number of of Ordinary Ordinary Share Name Shares capital

Old Mutual Global Investors 57,110,374 11.9 Fidelity Management & Research 31,394,498 6.6 Franklin Templeton Investments 30,556,891 6.4 Kames Capital 15,165,022 3.2 The Shareholders set out above do not have different voting rights. As at the Latest Practicable Date (prior to the publication of this document), the Company was not aware of any person or persons who, directly or indirectly, jointly or severally, exercise or could exercise control over the Company.

3 B.7 Selected historical key financial information The selected historical financial information relating to the Company set out below has been extracted without material adjustment from the reported on financial information for the six month period ended 30 June 2015 which appears in Part IV (Financial Information of the Paysafe Group):

Six month Six month period ended period ended 30 June 2015 30 June 2014 US$ US$

Revenue Straight Through Processing fees 173,033,711 117,355,497 Stored Value fees 49,756,862 41,426,120 Investment income 232,399 274,002

223,022,972 159,055,619

Cost of Sales Straight Through Processing expenses 108,782,499 66,769,565 Stored Value expenses 6,317,198 5,447,362

115,099,697 72,216,927

Gross proﬁt 107,923,275 86,838,692

Non Fee Expenses Salaries and employee expenses 34,708,699 24,466,661 Technology and software 11,002,590 10,643,223 Premises and ofﬁce costs 5,762,071 4,550,183 Professional fees 2,395,729 2,015,675 Marketing and promotions 9,205,585 7,020,778 Travel and entertainment 1,739,340 1,572,375 Bank charges 351,877 334,628 Depreciation and amortisation 14,784,369 7,269,757 Acquisition costs 12,377,267 1,521,355 Restructuring costs 4,133,813 — Foreign exchange loss / (gain) 5,788,670 (94,502) Net fair value gain on share consideration payable (1,610,000) — Loss on disposal of assets — 6,632

Results from operating activities 7,283,265 27,531,927 Finance costs 2,691,125 9,036

Proﬁt for the period before tax 4,592,140 27,522,891 Income tax expense 2,183,515 38,282

Proﬁt for the period after tax attributable to owners of the Group 2,408,625 27,484,609 Other comprehensive income Foreign currency translation differences for foreign operations, net of income tax (137,691) 49,528

Total comprehensive income for the period attributable to owners of the Group 2,270,934 27,534,137

Basic earnings per share $0.01 $0.10

Fully diluted earnings per share $0.01 $0.10

4 The selected historical ﬁnancial information relating to the Company set out below has been extracted without material adjustment from the audited ﬁnancial information of the Company for the three years ended 31 December 2014, which are incorporated by reference into this document:

Year ended 31 December

2014 2013 2012

(Audited) (US$ million) Revenue Straight Through Processing fees 274.7 193.0 138.9 Straight Through Processing Stored Value fees 89.6 59.8 38.8 Investment income 0.7 0.5 1.4

365.0 253.4 179.1 Cost of sales Straight Through Processing expenses 162.2 112.0 81.0 Stored Value expenses 13.6 9.5 8.4

175.8 121.5 89.4

Gross proﬁt 189.2 131.8 89.7

Gross margin STP (%) 41% 42% 42%

Gross margin stored value (%) 85% 84% 78%

Gross margin total (%) 52% 52% 50%

Non fee expenses Salaries and employee expenses 54.8 41.1 36.1 Technology and software 20.5 18.4 13.0 Premises and ofﬁce costs 11.1 9.0 7.6 Professional fees 5.1 4.3 2.9 Marketing and promotions 15.2 8.0 3.8 Travel and entertainment 3.9 2.7 2.2 Bank charges 0.7 0.7 0.4 Impairment charge — — — Depreciation and amortisation 21.0 13.5 11.8 Acquisition costs 11.6 — — Restructuring costs — 0.8 0.7 Foreign exchange gain 3.0 (0.9) (0.7) Other expenses — 0.5 6.4 Net fair value gain on share consideration payable (18.8) — —

128.1 98.1 84.2

Results from operating activities 61.1 33.7 5.5 Finance costs 2.0 1.0 1.8

Proﬁt before tax 59.1 32.7 3.7

Income tax expense 1.3 1.2 2.5

Proﬁt for the year after tax attributable to the owners of the Paysafe Group 57.8 31.5 1.2

Other comprehensive income Foreign currency translation differences for foreign operations, net of income tax 0.9 (0.9) (0.1)

Total comprehensive income for year attributable to the owners of the Paysafe Group 58.6 30.6 1.1

Basic proﬁt per share $0.36 $0.22 $0.01

Fully diluted proﬁt per share $0.32 $0.20 $0.01

5 Save as disclosed below, there has been no significant change in the trading or financial position of the Paysafe Group during the financial years ended 31 December 2012, 2013 and 2014, the six month period ended 30 June 2015 or the period subsequent to 30 June 2015, the end of the last financial period of the Paysafe Group for which financial information was prepared. The Paysafe Group acquired the entire issued share capital of Skrill on 10 August 2015 for approximately e1.1 billion. The selected historical financial information relating to the Skrill Group set out below has been extracted without material adjustment from the reported on financial information for the six months ended 30 June 2015 and the audited financial information for the year ended 31 December 2014 which appears in Section B of Part VI (Financial Information of the Skrill Group):

12 months 6 months to 6 months to to 30 June 30 June 31December 2015 2014 2014

(US$ millions) (Reported (Reported on) on) (Audited) Revenue 172,979 128,066 297,099 Cost of sales (70,172) (51,627) (118,333)

Gross proﬁt 102,807 76,439 178,766 Sales and marketing expenses (24,946) (19,181) (41,365) Administrative expenses (71,263) (53,659) (130,724)

Operating proﬁt 6,598 3,599 6,677 Finance income 25 5 40 Finance costs (34,450) (42,221) (83,967)

Loss before income tax (27,827) (38,617) (77,250) Income tax expense 1,994 (2,251) 5,706

Loss for the period * (25,833) (40,868) (71,544)

* Loss for the period is fully attributable to the owners of the Skrill Group. There has been no significant change in the trading or financial position of the Skrill Group during the financial years ended 31 December 2012, 2013 and 2014, the six month period ended 30 June 2015 or the period subsequent to 30 June 2015, the end of the last financial period of the Skrill Group for which financial information was prepared.

6 The selected historical financial information relating to the Skrill Operating Group set out below has been extracted without material adjustment from (i) the reported on financial information for the six months ended 30 June 2015 and the audited financial information for the year ended 31 December 2014 which appears in Section D of Part VI (Financial Information of the Skrill Group) and (ii) the audited financial information for the two years ended 31 December 2013, which are incorporated by reference into this document:

12 months 6 months to 6 months to to 30 June 30 June 31December 2015 2014 2014

(US$ millions) (Reported (Reported on) on) (Audited) Revenue 173,305 168,008 337,137 Cost of sales (70,171) (67,798) (134,394)

Gross proﬁt 103,134 100,210 202,743 Sales and marketing expenses (24,946) (24,362) (46,516) Administrative expenses (54,444) (53,327) (98,956)

Operating proﬁt 23,744 22,521 57,271 Finance income 23 7 41 Finance costs (8,022) (9,006) (24,792)

Proﬁt before income tax 15,745 13,522 32,520 Income tax expense (1,017) (2,245) (767)

Proﬁt for the period* 14,728 11,277 31,753

* Proﬁt for the period is fully attributable to the owners of the Skrill Operating Group.

7 Year ended 31 December

2013 2012

(Audited) (US$ million) Revenue Merchant revenue 212.0 83.7 Consumer revenue 36.4 11.5 Financial revenue 38.0 34.8

286.4 130.0 Cost of sales (116.0) (38.8)

Gross proﬁt 170.4 91.2

Sales and marketing expenses (38.5) (14.4) Administrative expenses (87.9) (47.4)

Operating proﬁt 44.0 29.4 Finance income 0.1 0.4 Finance costs (12.1) (7.4)

Proﬁt for the year before tax 32.0 22.4

Income tax expense (6.0) (6.8)

Proﬁt for the year 26.0 15.6

Proﬁt attributable to: Owners of the parent 26.0 15.5 Non-controlling interests — 0.1

Other comprehensive income Change in value of available for sale ﬁnancial assets (0.5) — Exchange differences on translation of foreign operations (0.2) (0.2) Cash ﬂow hedge 0.8 (1.5)

Total comprehensive income for year attributable to the owners of the Skrill Operating Group 26.1 13.9

Attributable to non-controlling interests — (0.1)

There has been no significant change in the trading or financial position of the Skrill Operating Group during the financial years ended 31 December 2012, 2013 and 2014, the six month period ended 30 June 2015 or the period subsequent to 30 June 2015, the end of the last financial period of the Skrill Operating Group for which financial information was prepared.

Notes: (1) Extracted without adjustment from the historical ﬁnancial information for Skrill Group for the 6 month period ended 30 June 2015 as set out in Part VI (Financial information of the Skrill Group) of this document. (2) Consolidated for Sentinel Topco Limited and subsidiaries but excluding the Skrill Operating Group. (3) Extracted from the historical ﬁnancial information for Skrill Group for 6 month period ended 30 June 2015 as set out in Part VI (Financial information of the Skrill Group) of this document.

B.8 Selected key pro forma ﬁnancial information The unaudited pro forma statement of net assets has been prepared to illustrate the effect on the net assets of the Paysafe Group as if the Skrill Acquisition had occurred at 1 January 2015.

8 The unaudited pro forma income statement (together with the unaudited pro forma statement of net assets, the ‘‘Pro Forma Financial Information’’) has been prepared to illustrate the effect on the profit and loss of the Paysafe Group as if the Skrill Acquisition and the Rights Issue had taken place on 1 January 2015 based on the reported on income statement of the Paysafe Group for the six month period ended 30 June 2015, adjusted to reflect the net income of the Skrill Group for the six month period to 30 June 2015. The Pro Forma Financial Information has been prepared for illustrative purposes only and in accordance with Annex II of the Prospectus Directive Regulation, and should be read in conjunction with the notes set out below. Due to its nature, the Pro Forma Financial Information addresses a hypothetical situation and, therefore, does not represent the Paysafe Group’s actual financial position and results. Unaudited pro forma statement of consolidated net assets

Consideration cash payment Paysafe Skrill Group Skrill Debt, and debt Consolidation 30 June 2015 30 June 2015 Acquisition proceeds repayment adjustments Total

US$’000 US$’000 US$’000 US$’000 US$’000 US$’000 US$’000 Note 1 Note 2 Note 3 Note 4 Note 4 ASSETS Current assets 877,808 769,153 579,345 555,000 (1,271,377) (579,345) 930,584 Non-current assets 298,004 804,545 — — — 512,910 1,615,459

Total assets 1,175,812 1,573,698 579,345 555,000 (1,271,377) (66,435) 2,546,043

LIABILITIES Current liabilities (152,610) (716,674) — — 51,240 — (818,044)

Non-current liabilities (144,163) (790,589) 390,561 (555,000) 420,937 — (678,254)

Net assets / liabilities 879,039 66,435 969,906 — (799,200) (66,435) 1,049,745

9 Unaudited pro forma consolidated statement of comprehensive income

Paysafe Skrill Group Six month Six month Adjustment Adjustment period ended period ended for Ukash for FANS 30 June 2015 30 June 2015 Acquisition Acquisition Total

US$’000 US$’000 US$’000 US$’000 US$’000 Note 1 Note 2 Note 5 Note 6 Revenue Straight Through Processing fees 173,034 173,034 Stored Value fees 49,757 49,757 Investment and other income 232 232 Revenue 172,979 11,220 182 184,381

223,023 172,979 11,220 182 407,404 Cost of Sales Straight Through Processing expenses (108,782) (108,782) Stored Value expenses (6,317) (6,317) Cost of sales (70,172) — (70,172)

Gross proﬁt 107,924 102,807 11,220 182 222,133 Administrative expenses (71,263) (9,253) (701) (81,217) Salaries and employee expenses (34,709) (34,709) Technology and software (11,002) (11,002) Premises and ofﬁce costs (5,762) (5,762) Professional fees (2,396) (2,396) Marketing and promotions (9,206) (24,946) (34,152) Travel and entertainment (1,739) (1,739) Bank charges (352) (352) Depreciation and amortisation (14,784) (135) (14,919) Acquisition cost (12,377) (12,377) Restructuring costs (4,134) (4,134) Foreign exchange gain (5,789) (5,789) Net fair value gain on share consideration payable 1,610 1,610

Results from operating activities 7,284 6,598 1,967 (654) 15,195 Net ﬁnance costs (2,691) (34,425) (37,116)

Proﬁt for the year before tax 4,593 (27,827) 1,967 (654) (21,921) Income tax expense (2,184) 1,994 (190)

Profit for the year after tax attributable to the owners of the Group 2,409 (25,833) 1,967 (654) (22,111) Other comprehensive income Change in FV of AFS financial assets (130) (130) Foreign currency translation differences for foreign operations, net of income tax (138) 1,122 984 Cash flow hedge 710 710

Total comprehensive proﬁt for the year attributable to the owners of the Group 2,271 (24,131) 1,967 (654) (20,547)

Notes to the unaudited pro forma financial information: 1. The Paysafe Group’s consolidated net assets at 30 June 2015 and consolidated comprehensive income for the six months ended 30 June 2015 have been extracted without adjustment from the financial information presented in Part IV (Financial Information of the Paysafe Group) of this prospectus. No account has been taken of the results of the Paysafe Group since this date. 2. The Skrill Group’s consolidated net assets as at 30 June 2015 and consolidated comprehensive income for the six months ended 30 June 2015 have been extracted without adjustment from the financial information presented in Section B (Reported on Financial Information of the Skrill Group

10 for the Six Month Period Ended 30 June 2015 and Audited Financial Information for the Financial Year Ended 31 December 2014) of Part VI (Financial Information of the Skrill Group) which contains the consolidated financial information of Sentinel Topco Limited, the holding company of the Skrill group of companies. No account has been taken of the results of the Skrill Group since this date. 3. Pursuant to the Skrill Acquisition, the Paysafe Group acquired 100 per cent. of the issued share capital of Skrill (comprising the ordinary shares and the preference shares and accrued return) and procured that the shareholder loan notes and accrued interest were redeemed at Completion. 4. The consideration for the Skrill Acquisition was settled by the Paysafe Group by way of cash of e720 million (US$799 million) paid at Completion (less the aggregate fees of Sentinel Group Holdings S.A. and the Skrill Group (and the other direct and indirect shareholders) incurred in respect of the Skrill Acquisition transaction and 50 per cent. of the fees incurred in respect of the transfer of Skrill USA Inc. and less an amount equal to the principal outstanding amount of loan notes issued by Sentinel Holdco 2 Limited (Sentinel Topco Limited’s immediate subsidiary) to Sentinel Group Holdings S.A., which was Eur 240,055,202.11 (US$266,394,592.34)), and the issue of 37,493,053 Paysafe Ordinary Shares (the ‘‘Skrill Consideration Shares’’), having a fair value of US$171 million on issue. The net debt repaid at Completion was Eur 307.7 million (US$277.2 million). Paysafe’s existing external bank debt (US$117 million) was refinanced as part of the Skrill Acquisition. Paysafe also repaid the Skrill Group’s external bank debt as part of the Skrill Acquisition. As such a facility of e500 million (US$555 million) was drawn and utilised in respect of repaying the Skrill Group’s external bank debt at Completion and refinancing the Paysafe Group’s external bank debt at Completion. 5. On 31 March 2015, the Skrill Group acquired 100 per cent. of the issued share capital of Smart Voucher Limited (‘‘Ukash’’). As such the income statement activity of this business for period 1 January 2015 to 31 March 2015, being the period prior to the Ukash Acquisition, has been adjusted for in the pro forma consolidated statement of comprehensive income. This information has been extracted from unaudited management financial information for the period without adjustment. This management financial information is prepared on a consistent basis to the financial information of the Paysafe Group in accordance with the International Financial Reporting Standards, as adopted by the European Union, and the Paysafe Group’s accounting policies. The income statement activity of Ukash for the period 1 April 2015 to 30 June 2015 is included within the financial information of Skrill in the consolidated statement of comprehensive income. The net assets of Ukash at 30 June 2015 are included within the financial information of Skrill in the consolidated statement of net assets presented. 6. On 22 May 2015 Paysafe Group acquired 100 per cent. of the issued share capital of FANS Entertainment Inc. (‘‘FANS’’). As such the income statement activity of this business for period 1 January 2015 to 22 May 2015, being the period prior to the FANS Acquisition, has been adjusted for in the pro forma consolidated statement of comprehensive income. This information has been extracted from unaudited management financial information for the period without adjustment. This management financial information is prepared on a consistent basis to the financial information of the Paysafe Group in accordance with the International Financial Reporting Standards, as adopted by the European Union, and the Paysafe Group’s accounting policies. The income statement activity of FANS for the period 22 May 2015 to 30 June 2015 is included within the financial information of the Paysafe Group in the consolidated statement of comprehensive income. The net assets of FANS at 30 June 2015 are included within the financial information of the Paysafe Group in the consolidated statement of net assets presented. 7. No effect of additional or reduced interest costs to be incurred on the proposed debt financing has been reflected in the pro forma consolidated comprehensive income.

B.9 Profit forecast or profit estimate Not applicable; the Company has not made a profit forecast or estimate.

11 B.10 Audit report on the historical financial information – qualifications Not applicable; no qualifications are included in any report on the Paysafe Group’s historical financial information, the Skrill Group’s or the Skrill Operating Group’s historical financial information contained in or incorporated by reference into this document.

B.11 Insufﬁcient working capital Not applicable; the Company is of the opinion that the working capital available to the Paysafe Group after taking into account its available bank facilities under the Credit Facilities, is sufﬁcient for its present requirements, that is, for at least 12 months following the date of publication of this document.

Section C: Securities

C.1 Type and class of securities being admitted to trading Paysafe has applied for the admission of 479,606,395 Ordinary Shares to: (i) the Ofﬁcial List; and (ii) trading on the Main Market. The ISIN for the Ordinary Shares is GB0034264548.

C.2 Currency of the securities issue The Ordinary Shares are priced in pence, and the Ordinary Shares will be quoted and traded in pence.

C.3 Number of issued and fully paid securities and par value As at the Latest Practicable Date the Company had in issue 479,606,395 fully paid ordinary shares of £0.0001 each and 1,000,000 fully paid deferred shares of one pence each.

C.4 Rights attached to the securities The Ordinary Shares will be issued and credited as fully paid and will rank pari passu in all respects with the Ordinary Shares in issue at the time the Ordinary Shares are delivered. Subject to any special voting rights, restrictions or prohibitions on voting for the time being attached to Ordinary Shares (for example, in the case of joint holders of a share, the only vote which will count is of the person whose name is entered ﬁrst in the register). Shareholders shall have the right to receive notice of, and to attend and vote at, general meetings of the Company. Subject to the provisions of the Acts, the Company may from time to time declare dividends and make other distributions on the Ordinary Shares.

C.5 Restrictions on transfer Not applicable; there are no restrictions on the free transferability of the Ordinary Shares set out in the constitutional documents of the Company.

C.6 Application for admission to trading on regulated market Applications have been made, respectively, to the FCA and to London Stock Exchange for the entire ordinary share capital of the Company, being the Ordinary Shares in issue as at the date of this document to be admitted to the premium listing segment of the Ofﬁcial List and to trading on the Main Market. It is expected that Admission will become effective and that dealings will commence in the Ordinary Shares on the London Stock Exchange at 8.00 a.m. on 23 December 2015. In relation to the applications detailed above, the Company notiﬁed the London Stock Exchange on 25 November 2015 of its wish to cancel the admission of its Ordinary Shares to trading on AIM and it is anticipated that such cancellation will occur simultaneously with Admission.

C.7 Dividend policy The Directors believe that Shareholders are best served by reinvesting cash to generate growth opportunities rather than declaring a dividend. The Paysafe Group intends to continue to pursue both organic and inorganic growth opportunities and therefore the Directors believe that it is appropriate not to declare dividends at this time. This policy remains under regular review.

12 Section D: Risks

D.1 Key information on key risks relating to the Company or its industry Risks relating to the Paysafe Group * The Paysafe Group, and its merchants and customers are subject to various laws and regulations in relation to online gambling. Such laws and regulations are constantly evolving and are often subject to conflicting interpretations and the legality of online gambling and the provision of services to online gambling merchants and customers is subject to uncertainties arising from differing approaches by legislatures, regulators and enforcement agents. This uncertainty creates a risk for the Paysafe Group that courts may interpret legislation in an unfavourable way and determine the Paysafe Group’s activities to be illegal, which could lead to actions (criminal or civil) being brought against the Paysafe Group or any of its Directors or the Paysafe Group (or its merchants and customers) being forced to cease doing business in a particular jurisdiction, all or any of which may, individually or collectively, have a detrimental effect on the financial performance and the reputation of the Paysafe Group. The Paysafe Group does not operate an online gambling company; however, it cannot be excluded that the Paysafe Group could be held legally responsible in some way for processing online gambling payments. The Paysafe Group may also be joined to proceedings brought against a merchant or third parties for tracing claims resulting in the seizure of funds. As at the date of this document, the Directors are not aware of any historic, current or pending enforcement action against the Paysafe Group’s activities or against the Directors or Senior Managers (or the people who previously held such positions) which has or would be likely to determine that such activities are illegal (other than historic proceedings brought by the USAO against the Company regarding its historic US business activities). * The Paysafe Group relies on the continued supply of its services to merchants within the online gambling industry. The Paysafe Group’s NETELLERâ business (which is the part of the Paysafe Group’s business which primarily provides services to the online gambling sector) represented approximately 25 per cent. of revenue of the Paysafe Group for FY2014 and 22 per cent. of the revenue for the Paysafe Group for the six month period ended 30 June 2015. In addition, the Largest Merchant, from which the Paysafe Group derived approximately 36.7 per cent. of revenue of the Paysafe Group for FY2014 and 29 per cent. of revenue for the Paysafe Group for the six month period ended 30 June 2015, provides online gambling services. The Skrill Group derived approximately 53 per cent. of its revenue from the online gambling sector in FY2014 and the six months ended 30 June 2015 respectively. Changes in the regulation of online gambling in the markets where the Paysafe Group derives more than three per cent. of its revenue, such markets being considered to be material markets for the Paysafe Group, may have a negative impact on the Paysafe Group’s business and financial performance if such operators are subject to heavier taxes, compliance costs, levies and licence fees or are forced to cease operating in a jurisdiction as a result of prohibitive legislation which may result in reduced demand for the services of the Paysafe Group within the online gambling industry. * The Paysafe Group has an indirect material revenue dependency on the Chinese online gambling market. For FY2014 and the six month period ended 30 June 2015, the Paysafe Group derived approximately 36.7 per cent. and 29 per cent. respectively of its revenue from the activities of the Largest Merchant (which is licensed and located in Europe), which includes revenues relating to the provisions of online gambling services in a number of countries. In order to provide services to the Largest Merchant, the Paysafe Group is reliant on the services provided by an outsourced service provider. If the service provider ceases to provide services to the Paysafe Group for any reason, the Paysafe Group would be adversely affected until the Paysafe Group was in a position to implement alternative arrangements with a replacement outsourced service provider. If the Paysafe Group experiences a delay in obtaining a replacement outsourced service provider or is forced to enter into an agreement with a replacement outsourced service provider on unfavourable terms, the Paysafe Group may not immediately be able to offer all of the services that are currently being offered to its Largest Merchant which, depending on the length of the delay, may have a material adverse effect on the Paysafe Group’s business and financial performance. The Paysafe Group derived approximately 36.7 per cent. of its revenue from the activities of the Largest Merchant during FY2014 and, following completion of the US Acquisitions on 23 July 2014, derived approximately 27 per cent. of its revenue from the

13 activities of the Largest Merchant for the period of 1 August to 31 December 2014. Therefore, if the Paysafe Group is unable to provide services to the Largest Merchant, or if the Largest Merchant decides to use an alternative payments processor the effect on the Paysafe Group would be significant in the absence of any other diversification of the Paysafe Group’s revenue. The Paysafe Group is continuing to pursue a strategy aimed at reducing its dependence on the Largest Merchant by way of diversification of revenue through organic and inorganic growth in other jurisdictions, such as the Skrill Acquisition which, assuming the Skrill Acquisition took place on 1 January 2015 would have resulted in revenue for the Paysafe Group of US$407.4 million for the six month period ended 30 June 2015 (compared to revenue of the Paysafe Group of US$223.0 million) for the six month period ended 30 June 2015 if the Skrill Acquisition had not occurred. * The Paysafe Group processes personal data, some of which may be sensitive, as part of its business and is subject to various consumer and data protection laws in the jurisdictions in which it operates. If the Paysafe Group fails to adhere to the terms of its privacy policy, customer expectations or the law, the Paysafe Group may be subject to investigative or enforcement action by the Information Commissioner’s Office in the UK or similar regulatory authorities in the Paysafe Group’s other countries of operation, legal claims and reputational damage. In addition, there can be no assurance that advances in computer capabilities, new discoveries in the field of cryptography, or other events or developments will not result in a compromise or breach of Paysafe Group’s privacy policies or the processes used by the Paysafe Group to protect customer transaction data. The Paysafe Group has been victim of occasional security breaches which resulted in accounts being compromised. If data were to be obtained by third parties without the consent of the customer this would have a potentially significant risk for the Paysafe Group from both a regulatory and reputational perspective. The EU Data Protection Regulation when implemented across the EEA (expected to be implemented in 2015) will significantly enhance the relevant obligations in relation to data protection including significant levels of fines. * The nature of the Paysafe Group’s business requires it to enter into numerous commercial and contractual relationships with banks, card schemes, issuers and financial institutions. The Paysafe Group depends on these relationships to operate on a day-to-day basis. These relationships are subject to a number of risks, including the risk that the Paysafe Group may be deemed to be non-compliant with certain laws or regulations (either in relation to the regulation of e-money or the provision of services to online gambling operators) by a bank or financial institution or banks, payment card schemes, issuers and financial institutions may see the Paysafe Group as being a competitor to their own business and may cease doing business with the Paysafe Group. If, for any reason, any banks, payment card schemes, issuers or financial institutions ceased to supply the Paysafe Group with the services it requires to conduct its business, or the terms on which such services are provided were to become less favourable or be cancelled, it could impact the Paysafe Group’s ability to provide its digital payment services, or the basis on which it is able to provide such services. * The Paysafe Group’s NETELLERâ business is regarded as a money transmission business in the US and money transmitting businesses are subject to numerous regulations in the US at the federal and state levels. The Paysafe Group has obtained money transmitter licences in New Jersey, Delaware, Iowa, North Dakota and Idaho. The Paysafe Group intends to acquire Skrill USA Inc. in order to expand its offering in the United States. If the Paysafe Group does not acquire Skrill USA Inc. it intends to apply for money transmitter licences in the remaining states in which they are required. Currently, the Paysafe Group’s NETELLERâ business in the US is sponsored by Sutton Bank with Sutton Bank carrying out the regulated money transmitting service on behalf of the Paysafe Group. The Directors are not aware of any circumstances that may result in the Paysafe Group being in breach of the terms of its money transmitter licences which would be likely to lead to a withdrawal of such licences or a material restriction on such licences. However, if the Paysafe Group were to violate laws or regulations governing money transmitters or electronic fund transfers, including as a result of any failure by employees of the Paysafe Group to correctly apply KYC procedures, this could result in a requirement for future compliance, fines, other forms of liability and/or force the Paysafe Group to change business practices or to cease operations in the US altogether.

14 D.2 Risks relating to the integration of Skrill * The Skrill Acquisition completed on 10 August 2015. The Directors believe that the Skrill Acquisition will provide strategic and financial benefits for the Paysafe Group. However, there is a risk that the anticipated benefits will fail to materialise, or that they will be less significant than anticipated, and this may have a significant impact on the Paysafe Group’s financial condition, results of operations and prospects and/or the price of the Ordinary Shares and the Paysafe Group’s ability to pay dividends.

D.3 Key information on key risks relating to the securities * Publicly traded securities from time to time experience significant price and volume fluctuations that may be unrelated to the operating performance of the companies that have issued them. In addition, the market price of the Ordinary Shares may prove to be highly volatile. The market price of the Ordinary Shares may fluctuate significantly in response to a number of factors, many of which are beyond the Paysafe Group’s control, including: (i) changes in financial estimates by securities analysts; (ii) changes in market valuation of similar companies; (iii) announcements by the Paysafe Group of significant contracts, acquisitions, strategic alliances, joint ventures or capital commitments; (iv) additions or departures of key personnel; (v) any shortfall in revenues or net income or any increase in losses or decrease in profits from levels expected by securities analysts; (vi) future issues or sales of Ordinary Shares; and (vii) stock market price and volume fluctuations. Any of these events could result in a material decline in the price of the Ordinary Shares. * The market price of the Ordinary Shares may prove to be highly volatile and the market price of the Ordinary Shares may fluctuate significantly in response to a number of factors, many of which are beyond the Paysafe Group’s control.

Section E: Offer

E.1 Total net proceeds and estimated total expenses Not applicable: This document relates to the application for listing of the Ordinary Shares on the Ofﬁcial List and admission to trading on the regulated market only.

E.2a Reasons for the offer, use of, estimated net amount of the proceeds Not applicable: This document relates to the application for listing of the Ordinary Shares on the Ofﬁcial List and admission to trading on the regulated market only.

E.3 Terms and conditions of the offer Not applicable: This document relates to the application for listing of the Ordinary Shares on the Ofﬁcial List and admission to trading on the regulated market only.

E.4 Material interests Not applicable: This document relates to the application for listing of the Ordinary Shares on the Ofﬁcial List and admission to trading on the regulated market only.

E.5 Selling shareholders Not applicable: This document relates to the application for listing of the Ordinary Shares on the Ofﬁcial List and admission to trading on the regulated market only.

E.6 Dilution Not applicable: This document relates to the application for listing of the Ordinary Shares on the Ofﬁcial List and admission to trading on the regulated market only.

E.7 Estimated expenses charged to investor Not applicable; no expenses are being directly charged to the investor by the Company in connection with the application for listing of the Ordinary Shares on the Ofﬁcial List and admission to trading on the regulated market.

15 RISK FACTORS

An investment in the Company involves a variety of risks. Accordingly prospective investors should consider carefully the specific risk factors set out below in addition to the other information contained in this document, including the information incorporated by reference into it, before investing in the Company. In particular, the Company’s performance may be materially and adversely affected by changes in the market and/or economic conditions and by changes in the laws and regulations (including any tax laws and regulation) relating to, or affecting, the Paysafe Group or the interpretation of such laws and regulations. If any of the following risks materialise, the business, financial condition, results or future operations of the Paysafe Group could be materially and adversely affected. In such circumstances, the trading price of the Ordinary Shares could decline and investors could lose part or all of their investment in the Ordinary Shares. In addition, the risks below are not the only risks to which the Company may be subject. The Company may be unaware of certain risks or believe certain risks to be immaterial which later prove to be material. The order in which risks are presented is not necessarily an indication of the likelihood of the risks actually materialising, of the potential significance of the risks or of the scope of any potential harm to the Paysafe Group’s business, results of operations and financial condition. The Company may be unaware of certain risks or believe certain risks to be immaterial which later prove to be material. Prospective investors should carefully consider whether an investment in the Ordinary Shares is suitable for them in the light of the information in this document and their personal circumstances.

PART A – RISKS RELATING TO THE PAYSAFE GROUP Online gambling legislation or regulation may be interpreted in such a way as to criminalise certain activities of the Paysafe Group The Paysafe Group generates a significant portion of its revenue by processing online payments for merchants and customers engaged in the online gambling sector. The Paysafe Group and its merchants and customers are subject to various laws and regulations in relation to online gambling as set out in Part II (Online Gambling Regulation) of this document. Such laws and regulations are constantly evolving and are often subject to conflicting interpretations. Many jurisdictions have not updated their laws to address the supply of online gambling, which by its nature is a multi- jurisdictional activity. Other jurisdictions have updated legislation to pass laws to regulate online gambling but only to permit licence holders to supply in that jurisdiction, some of which laws purport to have an extra territorial effect and which specifically preclude payment support of any gambling transactions, with powers to request the co-operation of banks and card issuers, or to criminalise the support they provide although such jurisdictions remain in the minority. Nevertheless, the legality of online gambling and the provision of services to online gambling merchants and customers is subject to uncertainties arising from differing approaches by legislatures, regulators and enforcement agents including in relation to determining in which jurisdiction the game or the bet takes place and therefore which law applies and where the transaction should be taxed. This uncertainty creates a risk for the Paysafe Group that even in instances where older laws have not been updated to address new technology, courts may interpret older legislation in an unfavourable way and determine the Paysafe Group’s activities to be illegal. This could lead to actions (criminal or civil) being brought against customers, merchants, the Paysafe Group or any of its Directors or the Paysafe Group (or their merchants or customers) being forced to cease doing business in a particular jurisdiction, all or any of which may, individually or collectively, have a detrimental effect on the financial performance and the reputation of the Paysafe Group. The Paysafe Group does not operate an online gambling company; however, it cannot be excluded that the Paysafe Group could be held legally responsible in some way for processing online gambling payments. If the Paysafe Group is found to be acting unlawfully in providing its services to online gambling merchants or customers in any jurisdiction this could have a negative effect on its reputation, operations and financial performance. There may also be additional civil, criminal or regulatory proceedings brought against the Paysafe Group and/or the Directors, Senior Managers and employees as a result. The Paysafe Group may also be joined to proceedings brought against a merchant or third parties for tracing claims resulting in the seizure of funds. Any such proceedings would potentially have cost, resource and reputational implications, and could have a material adverse effect on the results of operations, financial performance and future prospects of

16 the Paysafe Group and on the ability of the Paysafe Group to retain, renew or expand its portfolio of licences. Moreover, even if successfully defended, the process may result in the Paysafe Group incurring considerable costs and require signiﬁcant management resource and time.

As at the date of this document, the Directors are not aware of any historic, current or pending enforcement action against the Paysafe Group’s activities or against the Directors or Senior Managers (or the people who previously held such positions) which has or would be likely to determine that such activities are illegal (other than (i) historic proceedings brought by the USAO against the Company regarding its historic US business activities, prosecution for which was deferred for two years under the terms of a deferred prosecution agreement with all charges being subsequently withdrawn; (ii) and historic proceedings brought by the USAO against the entities which owned the Company’s predecessor business regarding its historic US business activities, in relation to which a non-prosecution agreement was negotiated with the USAO. Information on the deferred prosecution agreement and the non-prosecution agreement is set out in more detail in paragraph 12 of Part II (Online Gambling Regulation) of this document; and (iii) Skrill USA Inc., an entity which the Paysafe Group has agreed to buy, subject to the receipt of regulatory approval, has previously been subject to three cease and desist orders in the US (in Ohio, West Virginia and Kentucky) in respect of its anti-money laundering compliance matters. The implementation of each of the orders was suspended pursuant to consent orders under which Skrill USA Inc. undertook to improve its anti-money laundering compliance functions. Skrill USA Inc. has received notiﬁcations from the regulators in each of Ohio, West Virginia and Kentucky terminating the cease and desist orders.). However, the Paysafe Group will continue to monitor the regulatory landscape. Currently, the Paysafe Group monitors legal and regulatory developments in all of its material and target markets closely and generally seeks to keep abreast of legal and regulatory developments affecting the gambling industry as a whole. The Paysafe Group adapts its regulatory policies and, therefore, the scope of its ongoing monitoring on the basis that an individual market’s materiality to the Paysafe Group may change. The Paysafe Group has adopted a market presence policy which assesses a number of factors, including the legislative regime applicable to the relevant country, whether the Paysafe Group has a presence in such country and the overall environment for online gambling activities in that country and, then considers whether any changes are required to the extent of the Paysafe Group’s business activities in those countries. The policy extends to a consideration as to whether even a temporary presence presents undue risk in certain jurisdictions. For example, the Paysafe Group has previously ceased operations in particular jurisdictions following an assessment of the changing legal environment within the relevant jurisdiction. The policy extends to a consideration as to whether even a temporary presence presents undue risk in certain jurisdictions. The Paysafe Group also reviews its top 25 online gambling revenue producing countries and refreshes local law advice to assist in its assessments of risk. However, the Paysafe Group does not necessarily monitor, on a continuous basis, the laws and regulations in every jurisdiction where it facilitates payments for merchants or customers.

The Paysafe Group is reliant on the revenue derived from processing online payments for merchants and customers engaged in the online gambling industry The Paysafe Group relies on the continued supply of its services to merchants within the online gambling industry. The Paysafe Group’s NETELLERâ business (which is the part of the Paysafe Group’s business which primarily provides services to the online gambling industry) represents approximately 25 per cent. of the revenue of the Paysafe Group for FY2014 and approximately 22 per cent. for the six month period ended 30 June 2015. The Largest Merchant, from which the Paysafe Group derived approximately 36.7 per cent. of the revenue of the Paysafe Group for FY2014 and approximately 29 per cent. of the revenue of the Paysafe Group for the six months ended 30 June 2015 provides online gambling services. The Skrill Group derived approximately 53 per cent. of its revenue from the online gambling sector in FY2014 and the six month period ended 30 June 2015. Changes in the regulation of online gambling in the markets where the Paysafe Group derives more than three per cent. of its revenue, as at Completion, such markets being considered to be material markets for the Paysafe Group, may have a negative impact on the Paysafe Group’s business and ﬁnancial performance if such merchants are subject to heavier taxes, compliance costs, levies and licence fees or are forced to cease operating in a jurisdiction as a result of prohibitive legislation which may result in reduced demand for the services of the Paysafe Group within the online gambling industry.

17 The Paysafe Group is reliant on the services of third parties to enable the Paysafe Group to provide services to its customers in the online gambling industry The Paysafe Group relies on payment processing services from various service providers in order to allow the Paysafe Group to process payments for merchants and customers engaged in the online gambling and other sectors and to properly code such transactions. If a service provider chooses to terminate their relationship with the Paysafe Group (or elects to cease to provide certain payment support) as part of a policy decision (or for any other reason) or otherwise to refuse to process payments within the online gambling sector or any other sector in which the Paysafe Group provides its services and therefore ceases to transact with the Paysafe Group or if the Paysafe Group needs to replace third party payment processers due to their unreliability, interrupted settlement periods or low acceptance levels, this could have a material adverse effect on the ability of the Paysafe Group to process payments for merchants and customers until such arrangements are replaced. The Directors are not aware of any current circumstances which would result in the Paysafe Group not being able to contract with an alternative payment processor if such termination occurred. During November 2014 TK Global Partners, LP, a Paysafe subsidiary, received notice from a third party card payment processor that it intended to terminate its relationship with TK Global Partners, LP on 30 April 2015. The monthly revenue derived from the contract with the third party card payment processor averaged approximately US$3 million prior to receiving notice. TK Global Partners, LP entered into an agreement with a new payment processor in October 2015. During the interim period the previous payment processor continued to process payments for existing merchants on the same terms as it had done prior to termination of its agreement. However, if other third party payment processors choose to terminate their contracts with the Paysafe Group and the Paysafe Group is unable to find an alternative service provider or is unable to enter into an agreement on commercially reasonable terms, this could have a material adverse effect on the Paysafe Group and if the Paysafe Group was unable to find any alternative service provider willing to contract with the Paysafe Group, the Paysafe Group would need to withdraw from the relevant sector, which may have a material adverse effect on the financial condition, results of operations and future prospects of the Paysafe Group.

The Paysafe Group has an indirect material revenue dependency on the Chinese online gambling market in circumstances that may give rise to criminal and/or civil liability The Largest Merchant (located and licensed in Europe) provides online gambling services to customers based in a number of countries including China and the majority of the fees which the Paysafe Group derives from the Largest Merchant relate to the Largest Merchant’s remote provision of online gambling services into China. The Paysafe Group therefore has an indirect material revenue dependency on the Chinese online gambling market. The Paysafe Group derived approximately 36.7 per cent. and 29 per cent. of its revenue from the activities of the Largest Merchant during FY2014 and for the six month period ending 30 June 2015 respectively and the Skrill Group derived approximately 9.6 per cent. and approximately 8.8 per cent. of its revenue for FY2014 and for the six month period ended 30 June 2015 respectively from the Largest Merchant. The Largest Merchant supplies online gambling products to customers based in China, however, these services are provided remotely and, as far as the Directors are aware, the Largest Merchant does not have a presence in China, does not locate any persons, assets or infrastructure in China, does not use the services of any agents, aggregators or affiliates located in China, nor does it contract with any persons or entities there (with the exception of customers). In order to provide services to the Largest Merchant, the Paysafe Group is reliant on the services provided by a third party provider of outsourced services based in Hong Kong and Macau. This service provider was set up by a former employee of the Paysafe Group and in 2010, started providing services previously provided by the relevant Paysafe Group’s division. The Paysafe Group has a contractual relationship with the Largest Merchant but does not directly contract with customers within China, nor does it have a presence in China or Macau. The outsourced service provider uses a network of payment processors and money changers (bureaux de change) based within China to which it gives instructions to facilitate the acquiring of the customers’ payments online and to remit settlement funds to the Company, albeit it does not itself handle any of the funds flow from the customer’s Chinese bank account. Those monies are aggregated through money changers based in China. The Chinese money changers are affiliated with other money changers in Hong Kong and Macau who are responsible for remitting the settlement funds to the Company and the Company then settles with the Largest Merchant. Neither the Company nor the Largest Merchant contracts directly with payment processors or money changers in China nor do they remit or

18 receive any funds to or from China. The payment processors or money changers may be unwilling or unable to continue to provide their services, as has occurred in the past, and in those circumstances the outsourced service provider will attempt to substitute other payment processors and/or money changers. If a number of existing payment processors or money changers, who between them process a majority of the relevant payments or funds derived from the Asia Gateway service, were to stop providing their services and the outsourced service provider was unable to find replacement payment processors and/or money changers, this may materially adversely affect the service which the outsourced service provider provides to the Paysafe Group which will then, in turn, affect the service provided to the relevant merchant. If the outsourced service provider ceases to provide services to the Paysafe Group (for any reason including the outsourced service provider voluntarily ceasing its business or becoming subject to enforcement proceedings by the Chinese authorities in China, Hong Kong or Macau), the Paysafe Group would be adversely affected until the Paysafe Group was in a position to implement alternative arrangements with a replacement outsourced service provider and ensure that the replacement outsourced service provider is able to replicate the IT systems currently used by the Paysafe Group when providing the Asia Gateway service and ensure its staff were adequately trained on the operation of the Asia Gateway service. However, if the Paysafe Group experiences a delay in obtaining a replacement outsourced service provider or is forced to enter into an agreement with a replacement outsourced service provider on unfavourable terms, the Paysafe Group may not immediately be able to offer all of the services that are currently being offered to its Largest Merchant which, depending on the length of the delay, may have a material adverse effect on the Paysafe Group’s business and financial performance. The Directors are not aware of any current or pending enforcement action being taken directly against the outsourced service provider which Paysafe uses which would be likely to result in the outsourced service provider ceasing to provide services to Paysafe nor are the Directors aware of any current or pending enforcement action against the Largest Merchant, or circumstances where the Largest Merchant may determine it should cease supplying its services to its customers located in China. In addition, it cannot be ruled out that civil claims may be brought directly against the Paysafe Group or the outsourced service provider. Furthermore, criminal claims may be brought against any or all of the Directors for soliciting breaches of China’s Criminal Law and Law on Penalties (prior to the statute of limitations under Article 87 of the Criminal Law expiring) or equally against the executives of the outsourced service provider (or for running an enterprise in common with the Paysafe Group given the outsourced service provider’s financial dependence on the business of the Paysafe Group). However, the Directors understand, having taken legal advice, that there are numerous impediments to initiating prosecutions relating to activities taking place outside China, not least that claims against non-Chinese nationals for crimes which are conducted outside China (but where the impact of which occurs in China) is only feasible under current law where those activities are also illegal in the jurisdiction where they take place. On the basis of the legal advice obtained, the Directors believe it is highly unlikely that Chinese laws should be interpreted to apply or be capable of being enforced extra-territorially against such offshore websites and service providers, including the Paysafe Group and its merchants. Criminal claims may also be brought against the Directors under anti-money laundering legislation in Hong Kong. It is unlikely that any such claims would be brought by the Chinese regulators or those in Hong Kong if the Directors are not conducting business there particularly (in the case of Hong Kong) because the Company does not facilitate payments for gambling in Hong Kong. However, such events (were they to occur) could also lead to large scale multi-jurisdictional tracing claims across the Paysafe Group’s accounts which would have a negative financial impact upon the Paysafe Group. However the Directors believe (having taken legal advice) that the risks of such tracing claims to be low. The Directors continue to monitor the legal and regulatory environment in respect of these matters. In addition, criminal claims may be brought against the money changer in Hong Kong who as part of the payment support is responsible for accounting for and remitting the settlement funds to the Company and if the claim against the money changer is successful a claim may also be brought directly against the Paysafe Group or its Directors. This is however considered unlikely, particularly because the Paysafe Group does not actually facilitate any gambling payment for Hong Kong customers or unlicensed gambling in Hong Kong. For example, in Hong Kong under section 25(1) of the provisions of the Organised Serious Crimes Ordinance (‘‘OSCO’’), it is a criminal offence for a person to deal with property where they know, or have reasonable grounds to believe, that such

19 property represents, directly or indirectly, the proceeds of an indictable offence (an indictable offence is a more serious offence that can be tried on indictment in the Hong Kong District or High Courts). This offence extends to property which is derived from conduct which had it taken place in Hong Kong would be an indictable offence there. However case law has established that it must be a dual offence (that is such conduct must constitute an indictable offence both under the law of the territory where the activity actually took place and that it would have amounted to an indictable offence had it occurred in Hong Kong). In China a customer’s participation in online gambling is not unlawful although the facilitation of payments related to online gambling from within the PRC may constitute a criminal offence. It is possible, therefore, that section 25(1) of the OSCO could apply to the money changer in Hong Kong who as part of the payment support is responsible for accounting for and remitting the settlement funds to the Company and may therefore be deemed to be receiving in Hong Kong the proceeds of an indictable offence in China. Under section 89 of the Criminal Procedure Ordinance (‘‘CPO’’) anyone that aids, abets, counsels or procures a person to commit an offence, which would include the offence under section 25(1) of the OSCO, is equally guilty of the same offence and is subject to the same penalties as the principal offender. There is, therefore, a risk that the Company or the Directors could be prosecuted for a breach of section 25(1) on this basis. However, for the offence under section 25(1) to be made out, the underlying conduct must be an offence not only where it actually took place, China in this case, but also in Hong Kong had it taken place there. Arguably the activity or conduct to be considered under OSCO is the facilitation in Hong Kong of gambling in China, which is not illegal in Hong Kong provided bets can only be placed or are placed by a person outside Hong Kong. As it is unclear whether the money changer in Hong Kong who as part of the payment support is responsible for accounting for and remitting the settlement funds to the Company would be guilty if prosecuted under section 25(1) of OSCO, and accordingly whether there would be a principal offence under section 25(1) of the OSCO, the risk of prosecution of the money changer under that section and, therefore, the risk of prosecution of a member of the Paysafe Group or of the Directors of the Company under section 89 of the CPO is low and this risk is further reduced for the Directors as they are not physically present in Hong Kong. However, there are no legal precedents; if the conduct or activity that falls to be considered (in order to establish whether the OSCO provisions are engaged) is the facilitation in Hong Kong of gambling in Hong Kong, which is illegal if unlicensed in Hong Kong, there is a risk of prosecution of the money changer (under section 25(1)) and, therefore, a member of the Paysafe Group or the Directors of the Company (under section 89). As stated above this is however considered unlikely, particularly because the Paysafe Group does not actually facilitate any gambling payments for Hong Kong customers or unlicensed gambling in Hong Kong. The Paysafe Group derived approximately 36.7 per cent. and approximately 29 per cent. of its revenue from the activities of the Largest Merchant during FY2014 and for the six month period ended 30 June 2015 respectively. Therefore, if the Paysafe Group is unable to provide services to the Largest Merchant, or if the Largest Merchant decides to use an alternative payments processor the effect on the Paysafe Group would be significant in the absence of any other diversification of the Paysafe Group’s revenue. The Paysafe Group is continuing to pursue a strategy aimed at reducing its dependence on the Largest Merchant by way of diversification of revenue through organic and inorganic growth in other jurisdictions, such as the Skrill Acquisition which, assuming the Skrill Acquisition took place on 1 January 2015 would have resulted in revenue for the Paysafe Group (from all activities) of US$407.4 million for the six month period ended 30 June 2015, compared to revenue of the Paysafe Group of US$223.0 million for the period ended 30 June 2015 if the Skrill Acquisition had not occurred.

The Paysafe Group is subject to ﬁnancial services regulatory risks In the UK, e-money issuers, such as Optimal Payments Limited, Skrill Limited and Prepaid Services Company Limited, are currently required to be authorised by the FCA under the Electronic Money Regulations 2011 to perform the regulated activity of issuing e-money (which has the meaning speciﬁed in the Second Electronic Money Directive). E-money means electronically (including magnetically) stored monetary value as represented by a claim on the electronic money issuer which (a) is issued on receipt of funds for the purpose of making payment transactions; (b) is accepted by a person other than the electronic money issuer; and (c) is not excluded by regulation. An e-money issuer is someone who issues and redeems electronic money and provides payment services in accordance with the Second Electronic Money Directive. Paysafe Financial Services Limited, Skrill Limited and Prepaid Services Company Limited have the appropriate

20 licences and permissions to act as an e-money issuer in the UK. An entity that is authorised as an e-money issuer in one Member State can obtain a passport under the Second Electronic Money Directive to provide services in other EEA states by following a formal notification procedure. Each of Paysafe Financial Services Limited, Skrill Limited and Prepaid Services Company Limited has obtained a passport to carry out activities relating to its permissions to act as an e-money issuer in the UK in various EEA states, including Austria, France, Germany, Spain and Sweden. However, the Paysafe Group issues e-money in over 200 countries and territories and save for (i) paysafecard.com Schweiz GmbH, which is registered as a financial intermediary in Switzerland, (ii) Skrill Canada Inc., which is registered as a money services business in Canada and (iii) Prepaid Services Company Limited, which operates via a subsidiary in Turkey (being paysafecard.com o¨n o¨deme servicleri limited s¸irketi) on the basis of the Limited Network Exemption, no member of the Paysafe Group is licenced as an e-money issuer in any other jurisdiction. The Paysafe Group takes the view that in general it is not conducting regulated activities in these other jurisdictions on the basis that its activities of issuing e-money is not conducted in each jurisdiction in which relevant customers reside, but rather e-money is issued in the UK. The Paysafe Group has customers resident in over 200 countries and territories. The Paysafe Group acknowledges that local regulators in these jurisdictions may take a different view and, as transaction volumes increase and/or the matter is brought to its attention by local regulators, the Paysafe Group will take advice in respect of local requirements on a case by case basis. For example, in Japan, the Paysafe Group is in the process of applying for a Funds Transfer Business Operator licence in order to comply with Japanese regulatory requirements. The Directors expect the costs of making the application to be minimal. The Japanese regulator has confirmed that the Paysafe Group may continue to operate its existing business in Japan during the application process. The Directors are not aware of any circumstances that would lead to the application for a Funds Transfer Business Operator licence being rejected by the Japanese regulators. Due to ongoing developments in e-money regulation, the Paysafe Group obtains advice from local counsel as required in order to assess the risk arising and, where necessary, will limit the extent of its operations in a particular jurisdiction or will consider whether to obtain a licence. However, the Directors believe that the likelihood of any enforcement action by a regulator is low due to factors such as the operation of the services through the internet on a cross-border basis from a country in which the relevant entity holds a licence, the limited extent of the Paysafe Group’s activities in the respective jurisdictions, the lack of enforcement action against similar payment processors, the lack of a physical presence in the respective jurisdictions and the effective management of the Paysafe Group’s relationships with its customers. The Directors are not aware of any historic, current or pending financial, civil or criminal proceedings taken against the Paysafe Group in connection with a failure to hold a licence in the relevant jurisdiction (other than historic proceedings brought by the USAO against the Company regarding its historic US business activities, prosecution for which was deferred for two years under the terms of a deferred prosecution agreement with all charges being subsequently withdrawn. Information on the deferred prosecution agreement is set out in more detail in Part II (Online Gambling Regulation) of this document). However, if the Paysafe Group were found to be in violation of any current or future regulations, or to have previously been in breach of any regulation, in any countries from which it accepts merchants or customers, or were to lose any authorisation from the FCA, it may be required to seek additional licences and to comply with local regulations, which could lead to increased compliance costs. In addition, the Paysafe Group, its Directors, Senior Managers or employees may also be exposed to a financial liability, civil or criminal liability, forced to change business practices or forced to cease doing business with merchants or customers in one or more of those countries or have funds held on behalf of a particular merchant or customer seized, which may have a material adverse effect on the Paysafe Group’s results of operations, financial condition and future prospects. In addition, if the Paysafe Group decided to expand internationally, as it is currently in the process of doing in the US, it may incur additional costs of obtaining licences in those jurisdictions in which it chooses to have a presence. Such costs could have a material adverse effect on the Paysafe Group’s results of operations and financial condition.

Proceeds of crime laws or related anti-money laundering legislation may have an adverse impact on the business of the Paysafe Group The deﬁnition of what comprises a criminal act and the consequent crime of handling of criminal property can vary from jurisdiction to jurisdiction. Some jurisdictions consider that the underlying

21 criminal act that gives rise to criminal proceeds is very narrow (for example, terrorist ﬁnancing). Conversely, other jurisdictions have very wide deﬁnitions. By processing online payments for merchants and customers engaged in the online gambling sector, the Paysafe Group may be deemed to be handling proceeds of crime in the jurisdiction where its merchants and customers are located. Likewise, the ability for customers to withdraw and deposit funds within various accounts and the potential for customer fraud in connection with certain gambling activities heightens the risks of money laundering and the unwitting receipt of criminal proceeds by the Paysafe Group. However, the Paysafe Group mitigates risk by monitoring customers’ spending patterns very carefully and liaising with merchants where investigation is deemed appropriate. The Paysafe Group also seeks legal opinions to ensure that in the key jurisdictions where the Paysafe Group handles funds, the Paysafe Group (and the parties to which the Paysafe Group remits monies to in those jurisdictions) are not in breach of local anti-money laundering legislation. Nevertheless, there is a risk that funds could be traced or seized in the course of a cross jurisdictional investigation or enforcement action as well as charges being directed against the Directors of the Paysafe Group for continuing to process such payments where there was knowledge or suspicion of criminal activity. The Directors continue to monitor the legal and regulatory landscape in respect of these matters.

The Paysafe Group is reliant on transaction processing systems and services within and outside of the Paysafe Group The Paysafe Group’s business relies on the ongoing availability and uninterrupted operation of transaction processing systems and services within and outside of the Paysafe Group, respectively. All operational systems are vulnerable to damage or interruption from targeted denial of service attacks, viruses, natural or man-made disasters and human or technological failures under a variety of scenarios. A system outage or data loss could have a material adverse effect on the Paysafe Group’s business, financial condition and results of operations. Events that could cause system interruptions include fire, earthquake, terrorist attacks, natural disasters, attacks from malicious third parties, computer viruses, unauthorised entry, telecommunications failure and power loss. As the Paysafe Group’s customers may use the Paysafe Group’s products, as applicable, for critical transactions, any errors, defects or other infrastructure problems could result in damage to such customers’ businesses. These customers could seek significant compensation from the Paysafe Group for their losses and whilst insurance cover is in place any relevant policy may be insufficient to cover a claim. Even if unsuccessful, this type of claim is likely to be time consuming and costly for the Paysafe Group. In the event of a major failure of the Paysafe Group’s NETELLERâ systems, in accordance with its disaster recovery plan, the Paysafe Group’s stored value service was limited to confirming the balances of its customers and returning funds to such customers using a manual process which the Directors expect could take up to one week or more to complete, depending on the location of the customers. The Paysafe Group has purchased IT infrastructure in order to further enhance its stored value disaster recovery plan. In respect of its stored value services, the Paysafe Group has entered into an agreement with a data centre service provider in Ireland to deliver a Warm-Standby centre in Dublin, Ireland, being a back-up system which is data mirrored in near real-time, in respect of its stored value systems that are currently operating using the Paysafe Group’s servers in the Isle of Man. All infrastructure and data replication processes for this additional data centre were put in place at the end of June 2015, at which point the site became capable of fulfilling its disaster recovery role, and in the event of the failure of the main server site, switching to the additional data centre could take several hours. Final testing of the site has been completed and the data centre has been fully operational since the end of October 2015. In respect of its NETBANXâ business, the Paysafe Group has augmented its disaster recovery capabilities by establishing an active failover processing centre which will have the ability to reroute internet traffic with minimal disruption to the back-up facility for the majority of the Paysafe Group’s NETBANXâ services in the event of the failure of the Paysafe Group’s straight through processing systems. Traffic between the data centres will be rerouted in less than two minutes if there is a planned outage and in less than fifteen minutes if there is an unplanned event. The processing centre has been fully operational since mid-October 2015. The addition of global load balancing will further enhance the failover capabilities by lowering the time to reroute traffic. Global load balancing is currently being iteratively rolled out, with a target completion of end of January 2016.

22 The Paysafe Group’s production servers which underpin Paysafe’s merchant and customer services are currently located in Austria, Germany, the Isle of Man, the United States and Canada. The Paysafe Group also has IT infrastructure supporting global corporate services in Austria, Bulgaria, Canada, the United States and the United Kingdom. IT teams in Vienna, Sofia, Los Angeles, Calgary, Montreal, London and Cambridge, United Kingdom assist with the provision of servicing. Once the Paysafe Group’s business continuity programme has been implemented, the Directors believe that the varied location of its servers and the individuals that operate the transaction processing systems and services means that the probability of a single event resulting in the complete outage of the Paysafe Group’s straight through processing and stored value systems is extremely low. The Paysafe Group’s Hot-Standby data centre in Frankfurt, which serves the Paysafe Group’s Skrill branded products, is operational and the Paysafe Group’s data centre in Vienna is fully operational and serves as the secondary data centre for paysafecard. Traffic between the data centres can be switched almost immediately. The Paysafe Group will consider transferring the secondary data centre for paysafecard to its data centre in Dublin, Ireland during 2017. The worst case scenario of a corruption of data bases affecting both data centres would result in full functionality not being available for a period of approximately two to four hours. Such procedures may not, however, be sufficient to ensure that the Paysafe Group is able to carry on its business in the ordinary course if they fail or are disrupted, such that the Paysafe Group may not be able to anticipate, prevent or mitigate any material adverse effect of any failure on its operations or financial performance.

The Paysafe Group is reliant on a single major merchant The Paysafe Group derived approximately 36.7 per cent. and approximately 29 per. cent of its revenue from the activities of the Largest Merchant during FY2014 and for the six month period ended 30 June 2015 respectively, and the Skrill Group derived approximately 9.6 per cent. of its revenue for FY2014 and approximately 8.8 per cent. of its revenue for the six month period ended 30 June 2015 from the Largest Merchant. The Directors expect that the Paysafe Group will continue to derive a substantial, but decreased, proportion of its revenue from the Largest Merchant. The Largest Merchant can terminate its relationship with the Paysafe Group by providing not less than six months’ notice to the Paysafe Group. The loss of, or decrease in revenues arising from the Largest Merchant due to the Largest Merchant terminating its arrangements with the Paysafe Group, or any adverse impact on the volume of the Largest Merchant’s underlying business or for any other reason would be significant in the absence of any other diversification of the Paysafe Group’s revenue, resulting in a material loss of revenue and may therefore affect the Paysafe Group’s business, financial condition, operating results and cash flows. The Paysafe Group is continuing to pursue a strategy aimed at reducing its dependence on the Largest Merchant by way of diversification of revenue through organic and inorganic growth in other jurisdictions, such as the Skrill Acquisition which, assuming the Skrill Acquisition took place on 1 January 2015 would have resulted in revenue for the enlarged Paysafe Group from all activities of US$407.4 million for the six month period ended 30 June 2015 (compared to revenue of the Paysafe Group of US$223.0 million) for the period ended 30 June 2015 if the Skrill Acquisition had not occured.

The IT environments of the Paysafe Group and the Paysafe Group’s customers may be subject to hacking, data theft or other cyber security threats, which may harm customer relationships and the market perception of the effectiveness and resilience of the Paysafe Group’s products and services The IT security systems, software and networks of the Paysafe Group or the customers and third parties with whom the Paysafe Group interacts may be vulnerable to unauthorised access (from within the Paysafe Group or by third parties), computer viruses or other malicious code and cyber threats, which could result in the loss, theft or disclosure of confidential information relating to customers and employees, loss of unique pin codes and/or the loss of funds stored in e-Wallets and pre-paid cards. Certain of the Paysafe Group’s products are identified by unique pin codes assigned to it at the point of sale when a customer uses the voucher on a merchant website. These active voucher pins will be stored on the Paysafe Group’s servers. Due to the anonymous nature of these pins, a theft and subsequent fraudulent utilisation of pins from a server (either due to hacking or by internal fraud by an employee) could result in the original voucher holder’s inability to use their vouchers. Whilst customer verification and fraud management procedures are in place to mitigate this risk, the Paysafe Group would honour the payment by the original voucher holder

23 from its own funds and therefore incur a loss. Significant losses would have a material adverse effect on the Paysafe Group’s results of operation and depending on the nature of such fraudulent attacks, the Paysafe Group may be required to notify the relevant regulator and, depending on the nature of the fraud, other authorities such as the police of such fraudulent activities. Any adverse publicity as a result of such theft and fraudulent utilisation could adversely affect the Paysafe Group’s reputation and therefore the demand for the Paysafe Group’s products. In addition, if third parties with whom the Paysafe Group interacts violate applicable laws or the Paysafe Group’s data protection policies, such violations could result in legal claims or proceedings, which may subject the Paysafe Group to liability. Furthermore, the Paysafe Group’s current systems may be unable to support an increase in online traffic if it is subject to cyber attacks. The Paysafe Group has been the subject of multiple ‘‘EDoS’’ attacks which bombarded the Paysafe Group’s systems with excessive amounts of data, resulting in increased network traffic and a reduction in service. In addition, in April 2015, the Paysafe Group was subject to two ‘‘DDoS’’ attacks which were targeted at the Paysafe Group’s NETELLERâ services but affected both its NETELLERâ and NETBANXâ services for a period of 17 hours in total. The Directors believe the ‘‘DDoS’’ attacks resulted in a loss of approximately $190,000, which, subject to it being economic to making a claim, is partially recoverable under the Paysafe Group’s cyber security insurance policy. The Paysafe Group has also been victims of occasional security breaches which resulted in accounts being compromised. For example, NETELLER suffered a data breach as a result of a cyber-attack in 2010 which resulted in customer information being stolen. NETELLER reported the data breaches to the appropriate authorities at the time and a third-party independent forensic report was undertaken by a major accounting firm. The recommendations of the report were then followed and security was significantly strengthened with the aim of taking NETELLER beyond the industry standard. The Company became aware that approximately 1,500 customers subsequently had their accounts compromised during the 2010 cyber-attack. The Company immediately took action to restore these accounts and all customers who were affected and made a valid claim were reimbursed. The Company is not aware of any other reimbursal requests related to this incident since 2011. In addition, Skrill, then (operating as Moneybookers Limited) suffered a data breach as a result of a cyber-attack in 2009 which also resulted in customer information being stolen. Skrill reported the data breaches to the appropriate authorities at the time and a third-party independent forensic report was undertaken by a major accounting firm. The recommendations of the report were then followed and security was significantly strengthened. As a result of media enquiries at the end of October 2015 the Company was made aware that customers’ personal data was in the public domain and the Company accordingly informed both the Information Commissioner and the FCA and the Company began an internal investigation. The Company worked with a third party to obtain a copy of the data that it understood to be in the public domain and was able to confirm that limited NETELLER account details relating to 3.6 million NETELLER accounts and basic personal details relating to 4.2 million Skrill accounts were available in the public domain, of which less than 2 per cent. of the NETELLER and Skrill accounts were active in the six months to 1 November 2015. The personal data in the public domain did not include passwords, card data or bank account information. The Company engaged a major accounting firm as part of its investigation which verified the Company’s findings. The Company is confident that the data that is in the public domain will not in itself allow any existing NETELLER or Skrill customer accounts to be accessed. The Company is working with the Information Commissioner to determine which customers need to be notified about the information that is in the public domain and to give advice to those customers to help ensure that their security is not compromised. The Company believes that the data that is in the public domain emanated from the cyber-attacks in 2009 and 2010 and is not aware of any similar breaches since that time. Regardless of whether an actual or perceived breach is attributable to the Paysafe Group’s products, such a breach may cause contractual disputes and negatively affect the market perception of the effectiveness of the Paysafe Group’s products and reputation. Alleviating any of these problems could adversely affect the business, financial condition, operating results and cash flow of the Paysafe Group by: (i) requiring significant expenditures of capital and diversion of resources from development efforts; (ii) resulting in the Paysafe Group losing existing or potential customers; and/or (iii) resulting in the Paysafe Group being subject to legal action by customers or government authorities.

24 The Paysafe Group’s business and products are dependent on the availability, integrity and security of its IT systems The Paysafe Group’s IT systems and related software applications are integral to its business and the Paysafe Group relies on controls and systems to ensure data integrity of critical business information and proper operation of the Paysafe Group’s systems and networks. Lack of data integrity could create inaccuracies and hinder the Paysafe Group’s ability to perform meaningful business analysis and make informed business decisions. Despite network security, disaster recovery and systems management measures in place, the Paysafe Group may encounter unexpected general systems outages or failures that may affect its ability to conduct research and development, provide maintenance and support of its products, manage the Paysafe Group’s contractual arrangements, accurately and efficiently maintain the Paysafe Group’s books and records, record its transactions, provide critical information to its management and prepare its financial statements. Additionally, these unexpected systems outages or failures as a result of events such as fire, earthquake, terrorist attacks, natural disasters, attacks from malicious third parties, computer viruses, unauthorised entry, telecommunications failure and the loss of power may require additional personnel and financial resources, disrupt its business and its ability to generate revenue or cause delays in the reporting of its financial results. The Paysafe Group may also be required to modify, enhance, upgrade or implement new systems, procedures and controls to reflect changes in its business or technological advancements and, as a result, its IT and information management systems may fail to operate properly (for example, by capturing customer data erroneously) or become disabled as a result of events that are beyond the Paysafe Group’s control, such as increased transaction volume. The Paysafe Group upgrades its IT and information management systems to adapt to its evolving business needs, advances in technology and changing industry trends. These upgrades can create risks associated with implementing new systems and integrating them with existing ones. The Paysafe Group may also be required to incur additional costs in relation to any new systems, procedures and controls and additional management attention will be required in order to ensure an efficient integration, placing burdens on the Paysafe Group’s internal resources. Any failure of the Paysafe Group’s IT and information management systems could adversely affect the Paysafe Group’s ability to effect transactions and service customers and merchants, disrupt the Paysafe Group’s business or result in the misuse of customer data, financial loss or liability to the Paysafe Group or its customers, the loss of a supplier or regulatory intervention or reputational damage. Any of the foregoing could have a material adverse effect on the Paysafe Group’s results of operations and financial condition.

The Paysafe Group are subject to data protection laws and regulations The Paysafe Group processes personal data, some of which may be sensitive, as part of its business and is subject to various consumer and data protection laws in the jurisdictions in which it operates. If the Paysafe Group fails to adhere to the terms of its privacy policy, customer expectations or the law, the Paysafe Group may be subject to investigative or enforcement action by the Information Commissioner’s Office in the UK or similar regulatory authorities in the Paysafe Group’s other countries of operation, legal claims and reputational damage. In addition, there can be no assurance that advances in computer capabilities, new discoveries in the field of cryptography, or other events or developments will not result in a compromise or breach of Paysafe Group’s privacy policies or the processes used by the Paysafe Group to protect customer transaction data. The Paysafe Group has been victim of occasional security breaches which resulted in accounts being compromised. For example, NETELLER suffered a data breach as a result of a cyber-attack in 2010 which resulted in customer information being stolen and Skrill, then (operating as Moneybookers Limited) suffered a data breach as a result of a cyber-attack in 2009 which also resulted in customer information being stolen. As a result of media enquiries at the end of October 2015 the Company was made aware that customers’ personal data was in the public domain and the Company accordingly informed both the Information Commissioner and the FCA and the Company began an internal investigation. The Company worked with a third party to obtain a copy of the data that it understood to be in the public domain and was able to confirm that limited NETELLER account details relating to 3.6 million NETELLER accounts and basic personal details relating to 4.2 million Skrill accounts were available in the public domain, of which less than 2 per cent. of the NETELLER and Skrill accounts were active in the six months to 1 November 2015. The personal data in the public domain did not include passwords, card data or bank account information. The Company engaged a major accounting firm as part of its investigation

25 which verified the Company’s findings. The Company is confident that the data that is in the public domain will not in itself allow any existing NETELLER or Moneybooker’s customer accounts to be accessed. The Company is working with the Information Commissioner to determine which customers need to be notified about the information that is in the public domain and to give advice to those customers to help ensure that their security is not compromised. The Company believes that the data that is in the public domain emanated from the cyber-attacks in 2009 and 2010 and is not aware of any similar breaches since that time. If data were to be obtained by third parties without the consent of the customer this would have a potentially significant risk for the Paysafe Group from both a regulatory and reputational perspective. The EU Data Protection Regulation when implemented across the EEA (expected to be implemented in 2015) will significantly enhance the relevant obligations in relation to data protection including significant levels of fines.

The Paysafe Group is reliant on third party suppliers to provide certain services The Paysafe Group relies on certain outsourced service providers in the provision of various services to some of its customers. Such service providers supply services such as credit reference checks, anti-money laundering checks card issuance by Wirecard Solutions Limited and Bancorp and, in the US, card issuance and money transmission services by Sutton Bank. This reliance exposes the Paysafe Group to the service provider and if the service provider fails to adequately perform the outsourcing services in a timely manner to the expected standard, in compliance with its contractual obligations with the Paysafe Group and in accordance with applicable laws and regulations, this could have a material adverse effect on the Paysafe Group’s business and financial performance. If agreements with those outsourced service providers were terminated or if agreements were concluded on unfavourable terms, the Paysafe Group may not immediately be able to offer all of the services that are currently being offered which would have a material adverse effect on the Paysafe Group’s business and financial performance whilst the Paysafe Group sought to make alternative arrangements. Some third party service providers are, or may become, owned by competitors of the Paysafe Group. If the Paysafe Group could not obtain services from these sources or elsewhere, the business of the Paysafe Group could suffer materially. Increased reliance on third party service providers could therefore have a material adverse effect on the Paysafe Group’s business and financial performance. In addition, some third party suppliers on which the Paysafe Group may rely, may be smaller or less well established due to the nature of the sectors and wide ranging geographies in which the Paysafe Group operates, and may therefore be more susceptible to ceasing or limiting their business operations, which may have a material adverse effect on the Paysafe Group’s business and financial performance until such time as the Paysafe Group replaced such supplier.

The Paysafe Group is dependent on certain outsourcing arrangements The Paysafe Group outsources certain IT-related functions to third parties that are responsible for maintaining their own network security, disaster recovery and systems management procedures. The Paysafe Group also relies on intra-group outsourcing relationships relating to the Paysafe Group’s approach to risk with its employees based in Calgary, Canada and Soﬁa, Bulgaria. If the Paysafe Group’s third party IT vendors fail to manage their IT systems and related software applications effectively or if the Paysafe Group does not establish robust review processes or internal audit processes, there is a risk that disruption caused by an inadequate or a slow response to material risks facing the Paysafe Group may materially and adversely affect the Paysafe Group’s ability to sell products or services to customers and merchants and therefore materially and adversely affect the Paysafe Group’s reputation, performance or ﬁnancial condition.

The Paysafe Group is reliant on third party retail outlets to distribute some of its products paysafecard vouchers and Ukash codes are sold through distributors in non-Paysafe Group owned points of sale (such as convenience stores and petrol stations) by way of third party manufactured and managed issuance terminals. Failures or unavailability of the terminals or an unexpected closure of points of sale will result in loss of sales for the Paysafe Group. Furthermore, although a customer will receive a valid paysafecard voucher or a Ukash code at the point of purchase, the Paysafe Group will, in some cases, only receive funds associated to the vouchers sold from the distributors or at the points of sale at a later date, a non-payment by the retail store does not invalidate the vouchers it sold, and therefore the Paysafe Group could be subject to ﬁnancial

26 losses if it is unable to recover outstanding amounts from the point of sales due to a distributor’s default or for any other reason. The Paysafe Group has introduced a pin on demand system in respect of paysafecard vouchers to which the majority of the volume of its transactions is routed in order to mitigate this risk. The Paysafe Group expects to continue to migrate its transaction volumes to this system throughout FY2015.

The success of the Paysafe Group depends on its relationships with banks, payment card schemes, issuers and financial institutions The nature of the Paysafe Group’s business requires it to enter into numerous commercial and contractual relationships with banks, card schemes, issuers and financial institutions. The Paysafe Group depends on these relationships to operate on a day-to-day basis. These relationships are subject to a number of risks, including the following: * loss of banking relationships: the Paysafe Group relies on the use of numerous bank accounts in the jurisdictions in which it operates for the efficient delivery of its services. A loss of any important banking relationship could have a material effect on the Paysafe Group’s business and financial performance. As at the date of this document, the Directors are not aware of any facts or circumstances which may lead to a loss of any important banking relationship; * failure of banks and financial institutions: the Paysafe Group holds its own and merchants’ and customers’ funds on deposit at various banks and financial institutions. The Paysafe Group receives funds from its merchants and customers into a number of bank accounts operated by various banks in the jurisdictions in which the Paysafe Group operates. The Paysafe Group then transfers funds, from the various banks in the jurisdictions in which it operates, to two European A rated banks such that amounts equivalent to all merchant and customer funds are held in segregated accounts with the two banks a day after receipt from merchants and customers in accordance with applicable regulatory requirements. Historically, the Skrill Group received and held funds from its merchants and customers in a number of bank accounts operated by various banks (which are not all A rated) in the jurisdictions in which it operated, each of which account is a segregated account. Following Completion, the Paysafe Group has retained the bank accounts used by the Skrill Group and funds are continuing to be held in these accounts. However, the Paysafe Group is undertaking a review of the policies historically applied by the Skrill Group and the Paysafe Group in order to determine which policy will be adopted in respect of the Paysafe Group’s merchants’ and customer funds. Whilst there can be no guarantee that the banks in which funds are held will not suffer any kind of financial difficulty or commence any insolvency or bankruptcy proceedings, or any moratorium, composition, arrangement or enforcement action or any other kind of analogous event in any jurisdiction which may result in the permanent loss of some or all of the Paysafe Group’s own funds or the funds of merchants or customers, the Directors believe that the risk of such an event occurring, where such event would result in the Paysafe Group being unable to reimburse merchants or customers is low due to, the use by the Paysafe Group of only A rated banks to hold segregated funds and, the Skrill Group’s diversification of risk by holding merchant and customer funds spread over numerous banks. However, if such an event did occur, Paysafe would have an obligation to settle funds in respect of its NETELLERâ business and in respect of any merchant acquiring services which the Paysafe Group undertakes in respect of its NETBANXâ business, with such services currently representing an immaterial part of the NETBANXâ business, and the Paysafe Group would have an obligation to settle funds for the Skrill Group’s business other than in respect of the Skrill Group’s PSP business. Loss of funds would not be covered by insurance held by the Paysafe Group, and therefore, if the failure of one or more financial institutions resulted in the loss of merchants’ or customers’ funds which were not reimbursed by any regulatory or government scheme, there would be a material adverse effect on the Paysafe Group’s business and financial performance; * conflicting terms and conditions: the Paysafe Group’s characterisation of its products and services under applicable terms and conditions of banks and financial institutions, and the rules of payment card schemes, may differ from that of the banks, financial institutions and payment card schemes with which the Paysafe Group transacts payments. Resolving differing interpretations may cause the Paysafe Group to incur significant costs, and further costs may arise in connection with any resulting dispute or termination, limitation or modification of the

27 Paysafe Group’s relationships with banks, financial institutions or payment card schemes. These may lead to the loss of merchants or customers and in the Paysafe Group being required to withdraw or limit the availability of its products or services; * personal and financial data: certain of the Paysafe Group’s products and services require customers to provide the Paysafe Group with personal bank account information and other financial data, the provision of which may constitute a breach by customers and/or the Paysafe Group of the terms and conditions applicable to the relevant account or data. As a result, banks, financial institutions or card payment schemes may refuse to permit their customers to utilise the Paysafe Group’s products and services, which could cause the Paysafe Group to lose merchants or customers and to be required to withdraw or limit the availability of any of its products and services; * short-term contracts: the Paysafe Group’s contracts with banks, payment card schemes, issuers and financial institutions tend to be of a short-term duration and may not be renewed or may be cancelled with immediate effect if the Paysafe Group’s relationship with such providers were to deteriorate; * delayed settlement: certain of the Paysafe Group’s payment service providers only settle with the Paysafe Group on a delayed settlement basis. Settlement periods range between 48 hours (in the case of Visa and MasterCard) up to 90 days in the case of Boku Inc.. In the event that any of those providers were to fail and the Paysafe Group continued to settle underlying transactions (because they did not become aware of the failure of the payment service provider), or had outstanding transactions which had not yet been settled by the payment service provider it could have a material adverse effect on the Paysafe Group. Once the Paysafe Group became aware that a payment service provider had failed (which the Directors believe would be apparent within a very short period of time), the Paysafe Group would stop making the service provider available as a payment method, thereby stopping any new transactions from being processed. In respect of transactions which had not yet been settled by the payment service provider, the Paysafe Group would have a claim against the payment service provider and would seek to recover the funds from such payment service providers, which may be material in the context of the Paysafe Group’s business. However, the Directors believe that the diversification amongst the payment service providers and the identity of the payment service providers used by the Paysafe Group is such that the risk to the Paysafe Group is mitigated; * Visa and MasterCard operating rules: the Paysafe Group is subject to the operating rules and regulations of Visa and MasterCard and changes to those operating rules and regulations could have a material adverse effect on the Paysafe Group; * fines and assessments: the payment card schemes and their processing service providers may pass on fines and assessments in respect of fraud or chargebacks related to the Paysafe Group’s merchants or disqualify the Paysafe Group from processing transactions if satisfactory controls are not maintained; * risk management policies: banks and financial institutions which supply the Paysafe Group with services which enable it to operate the online payments platform could regard the Paysafe Group as being non-compliant with certain laws or regulations (either in relation to the regulation of e-money or the provision of services to online gambling operators) which are applicable to the bank in its home state or may regard the customers of the Paysafe Group as being non-compliant, may choose to withdraw from certain markets as a result of their internal risk management policies and may, in compliance with their regulatory obligations or internal risk and compliance policies, freeze the funds of the Paysafe Group’s merchants. The Directors are not aware of any instances where the Paysafe Group’s own funds have been frozen and, in the case of a merchant’s funds being frozen, the Paysafe Group would initially seek to facilitate the release of the merchant’s funds to the extent that they are able to do so. If further information is required by the financial institution before any funds may be released, the Paysafe Group would refer the merchant to the financial institution directly. The funds of a merchant of the Paysafe Group have only been frozen approximately three times in the last three years and all instances were in connection with the Asia Gateway service. Based on the historical experience of the Paysafe Group, the Directors believe that the risk of a merchant’s funds being frozen who is not using the Asia Gateway service is not material to the business of the Paysafe Group. The terms and conditions of the Asia Gateway service

28 provide that the merchant bears the risk of its funds being frozen by a bank or financial institution, however, there is a risk that merchants may choose to cease transacting with the Paysafe Group if their funds are frozen. Banks and financial institutions may also cease to transact, or reduce the level of, business with the Paysafe Group as a result of the Paysafe Group providing services to the online gambling sector. For example, within the last 12 months, three banks have made a policy decision to terminate their relationship with the Paysafe Group, although one bank has now re-established its relationship with the Paysafe Group; * potential competitors: banks, payment card schemes, issuers and financial institutions may see the Paysafe Group as being a competitor to their own business and may cease doing business with the Paysafe Group as a result. For example, the Paysafe Group recently obtained Principal Membership with Visa and MasterCard and therefore some financial institutions in the future may see the Paysafe Group as a competitor. If, for any reason, any banks, payment card schemes, issuers or financial institutions ceased to supply the Paysafe Group with the services it requires to conduct its business, or the terms on which such services are provided were to become less favourable or be cancelled, or a contractual claim made against the Paysafe Group, it could impact the Paysafe Group’s ability to provide its online payment services, or the basis on which it is able to provide such services. This, and any of the factors set forth above, could result in a loss for the Paysafe Group which could have a material adverse effect on the Paysafe Group’s results of operations, financial condition and future prospects.

The Paysafe Group may not be able to protect its intellectual property rights The Paysafe Group’s success and ability to compete in markets depends, in part, upon proprietary technology. The Paysafe Group relies on copyright, trade secret and trademark laws to protect technology, including the source code for proprietary software, and other proprietary information. The Paysafe Group has not applied for any patents in respect of its electronic payment processing systems and cannot give assurances that any patent applications will be made by the Paysafe Group or that, if they are made, they will be granted. A third party might try to reverse engineer or otherwise obtain and use the Paysafe Group’s technology without permission, allowing competitors to duplicate products. In addition, the laws of some countries in which the Paysafe Group sells products may not protect software and intellectual property rights to the same extent, for example, as the laws of the United Kingdom and the United States.

Proposed expansion through merger and acquisition activity and/or joint ventures may not go as planned and could have a detrimental effect on the Paysafe Group’s financial performance The Paysafe Group may seek to expand through mergers and acquisitions. The Paysafe Group has not entered into any binding agreements in order to facilitate a potential acquisition as at the date of this document, however, the Company has signed two non-binding letters of intent in respect of two small potential acquisitions in October 2015. The first proposed acquisition involves the purchase of a card payment transaction portfolio. The consideration for the proposed acquisition, if it proceeds, is intended to be satisfied in cash. The second proposed acquisition involves the purchase of the business and assets or shares of a prepaid online and mobile payment services provider. The consideration for the proposed acquisition, if it proceeds, is intended to be satisfied in cash. The Paysafe Group’s ability to access funding is important to retain sufficient flexibility in the Paysafe Group’s strategic development. If the Paysafe Group is unavailable to access funding or is provided funding on unfavourable terms, this may have a material effect on the Paysafe Group’s business and financial performance. In identifying potential merger and acquisition targets, the Paysafe Group would endeavour to ensure appropriate due diligence is carried out, but acquisitions would necessarily leave the Paysafe Group exposed, at least to some degree, to any operational failings of the target company or business and potentially to overpaying for any such target company. Any payment for such target company or business with Ordinary Shares could dilute the interests of the Shareholders. Merger and acquisition activity, including the difficulties involved in integrating companies, businesses, assets or brands, may divert financial and management resources from the Paysafe Group’s core business, which could have a material adverse effect on the Paysafe Group’s culture,

29 reputation, business and financial performance. In addition, there can be no assurance that any mergers or acquisitions will successfully achieve their aims. In addition, the Paysafe Group may expand through joint ventures and other collaborative activities with third parties. Participation in joint projects carries an inherent risk in their management and it can be difficult to guarantee the achievement of joint goals. Similarly, cooperating in this way with third parties may require the Paysafe Group to rely on its partners to help achieve its aims and maintain the Paysafe Group’s reputation. Joint ventures, including the difficulties involved in integrating companies, businesses or assets, may divert financial and management resources from the Paysafe Group’s core business, which could have a material adverse effect on the Paysafe Group’s business and financial performance.

The Paysafe Group may fail to hold, safeguard or account accurately for merchant or customer funds The Paysafe Group employs a high level of internal controls and compliance procedures to hold, safeguard and account accurately for account holders’ funds. In order to safeguard funds, account holders’ funds must either be held in secure, liquid low-risk assets that are held by a custodian or placed in a segregated account of an authorised credit institution or the firm may hold an insurance policy or bank guarantee to safeguard the funds. As the Paysafe Group’s business continues to grow, it must continue to strengthen its internal controls. The Paysafe Group’s success relies on public confidence in its ability to handle large and growing transaction volumes and merchants’ or customers’ funds. In addition, the Electronic Money Regulations require e-money providers to safeguard their customer funds from receipt until the e-money for which those funds have been exchanged is spent or redeemed and for a period of six years following termination of the e-money contract. Any failure to maintain necessary controls, to effectively safeguard the funds of the Paysafe Group’s merchants or customers or to manage merchants’ or customers’ funds accurately, whether as a result of a failure of the Paysafe Group’s internal controls, failure to put in place adequate arrangements with banks or payment processors, human error, erroneous interpretation of the relevant regulatory requirements or otherwise, could severely diminish merchant or customer use of the Paysafe Group’s services and could have a material adverse effect on the Paysafe Group’s results of operations, financial condition and future prospects. Further, a failure to adequately safeguard the funds of its customers could result in the Paysafe Group being subject to enforcement action by the relevant regulator which could result in fines or other penalties being levied against the Paysafe Group.

The Paysafe Group is vulnerable to the effects of chargebacks and merchant insolvency As part of its offering, the Paysafe Group offers its merchants a ‘‘no chargeback policy’’. A chargeback is the return of funds to a customer and in this context relates to a reversal of unauthorised charges to a customer’s credit card, for example, as a result of fraud or identity theft. Under the ‘‘no chargeback policy’’ the Paysafe Group agrees to allow merchants who qualify under the Paysafe Group’s vetting policy to retain all monies received from NETELLERâ and certain Skrill account holders respectively and undertake not to request reimbursement from such merchants in respect of chargebacks incurred. In such cases, the full amount of the disputed transaction is charged back to the Paysafe Group and the Paysafe Group’s credit card processor may levy additional fees against the Paysafe Group unless the Paysafe Group can successfully challenge the chargeback. The Directors believe that the ‘‘no chargeback policy’’ offered by the Paysafe Group is a key factor in a merchant’s decision to use the Paysafe Group’s services. The Paysafe Group is also exposed to the effect of chargebacks in the provision of its NETBANXâ bureau service. Under that service, the Paysafe Group is liable to various acquiring banks for chargebacks incurred by the Paysafe Group’s merchants where the merchants are unable to meet liabilities arising as a result of those chargebacks. If the average chargeback rate on any of the Paysafe Group’s merchant portfolios at any acquiring bank exceeds the maximum average chargeback rate permitted by the card schemes, the Paysafe Group will be required to take steps to reduce the average chargeback rate so that it falls below the maximum permitted rate or risk losing its relationship with that acquiring bank. Those steps might include processing more transactions for merchants who have lower chargeback rates to produce a lower average chargeback rate for the portfolio as a whole or terminating relationships with merchants who have higher chargeback rates which could in turn lead to material loss of revenue for the Paysafe Group.

30 Chargebacks may arise as individual claims or as multiple claims relating to the same facts or circumstances. For example, the insolvency or cessation of a merchant doing business could cause numerous individual customers to bring claims at once which, either singly or in aggregate, could have a material adverse effect on the Paysafe Group’s results of operations, ﬁnancial condition and future prospects.

Economic conditions and current economic weakness The Paysafe Group operates in global markets with customers in over 200 countries and territories, and has a physical presence in a number of countries around the world. The Paysafe Group runs a number of different operating platforms supporting core payment processing services. Any economic downturn either globally or locally in any area in which the Paysafe Group operates may have an adverse effect on the demand for the Paysafe Group’s products and services. In particular, the recessionary economic environment in the EU is continuing and economic growth in China is slowing down, however the US economy is showing signs of strengthening and the position in Canada is in ﬂux. A more prolonged economic downturn may lead to an overall decline in the volume of the Paysafe Group’s sales, restricting the Paysafe Group’s ability to realise a proﬁt. The markets in which the Paysafe Group offers its products and services are directly affected by many national and international factors that are beyond the Paysafe Group’s control.

The Paysafe Group must continue to innovate in order to remain competitive The Paysafe Group must continue to enhance and improve the responsiveness, functionality and features of its products and services and the underlying network infrastructure. The internet and e- commerce industries are characterised by rapid technological change, changes in user requirements and preferences, frequent new product and service introductions embodying new technologies, and the emergence of new industry standards and practices that could lead to the Paysafe Group’s technology and systems being considered to be outdated or deficient. The Paysafe Group’s ability to compete in the market and its financial position would suffer were it unable to respond to technological advances, emerging industry standards or customer and merchant preferences in a timely and cost-effective manner. Further, the inability to respond to changing demands or online customer behaviours could have a material effect on the Paysafe Group’s business and financial performance. Furthermore, as a greater number of customers are increasingly connecting to the internet using devices other than personal computers (such as mobile phones and tablets), the Paysafe Group must ensure that it can develop multi-channel technology which allows it to remain competitive within these rapidly evolving environments. The Paysafe Group must invest significant resources in research and development in order to enhance its technology, product and service offering. The Directors intend to continue to invest in innovation of products and services in order to maintain the competitive position of the Paysafe Group.

Competition may affect the Paysafe Group’s financial condition The Paysafe Group operates in rapidly evolving payments markets, where service provision is intensely competitive and subject to rapid technological change. The Paysafe Group face competition from non-traditional participants as well as established payment processors. Certain competitors have longer operating histories, significantly greater financial, technical, marketing, member service and other resources, greater name recognition and/or a larger base of members in affiliated businesses. The Paysafe Group may also face increased competition from new entrants, such as Apple Pay and AliPay that may have substantially greater financial, marketing, technical or other resources. The Paysafe Group’s competitors may also merge or form strategic partnerships. Further, the Paysafe Group’s competitors may respond to new or emerging technologies and changes in merchant and customer requirements faster and more effectively than the Paysafe Group. If these competitors were to acquire significant market share, this could result in the Paysafe Group losing market share, which would have a material adverse effect on the Paysafe Group’s business and financial performance. If the Paysafe Group cannot compete effectively, the demand for the Paysafe Group’s services may decline which would adversely impact the competitive position and adversely affect the business and financial performance of the Paysafe Group. The Directors believe that pursuing a strategy of product diversification mitigates the risk of the business of the Paysafe Group being adversely affected by increased competition. The Directors

31 pursue relationships with merchants operating in ‘‘niche’’ markets such as online gambling, online dating, travel and in particular sectors such as e-commerce and mobile commerce, which the Directors expect will assist the Paysafe Group to maintain its competitive position. The Directors also intend to continue to review opportunities for strategic acquisitions, such as the US Acquisitions and the Skrill Acquisition, in order to further diversify the business of the Paysafe Group.

The Paysafe Group are subject to a variety of local laws and regulations, which are continuously evolving and are required to obtain various licenses in order to operate its business The regulatory framework in which the Paysafe Group operates comprises many different local and regional legal frameworks, each with differing approaches to the regulation of payment processing and e-money. The regulatory framework governing the online gambling industry, one of the principal markets affecting the Paysafe Group’s business, is dynamic and complex and many countries have introduced licensing regimes, leading to greater regulatory oversight and scrutiny for many of the Paysafe Group’s customers. In some instances, a lack of clarity in the regulations or conflicting legislative and regulatory developments means that the Paysafe Group’s customers may risk failing to obtain an appropriate licence or authorisation, having existing licences or authorisations adversely affected, or be subject to other regulatory sanctions which could have a material adverse effect on the Paysafe Group’s business and financial performance. Any changes in the applicable regulatory regime or the way in which a regime is enforced in an important jurisdiction could also have a material adverse effect on the Paysafe Group’s business and financial performance in that jurisdiction.

The Paysafe Group must comply with the terms of its permissions and licences in order to continue to operate as a money transmitter in the US The Paysafe Group’s NETELLERâ business is regarded as a money transmission business in the US. Money transmitting businesses are subject to numerous regulations in the US at the federal and state levels. Currently, the Paysafe Group’s NETELLERâ business in the US is sponsored by Sutton Bank with Sutton Bank carrying out the regulated money transmitting service on behalf of the Paysafe Group. Prior to Completion, the Skrill Group, through Skrill USA Inc., operated in a large majority of the US states, the District of Columbia and its territories on the basis of money transmitter licences in the US states where a licence is required, save for Indiana where Skrill USA Inc. is proceeding with a licence application. Prior to Completion, the Skrill Group completed an intra-group restructuring to transfer Skrill USA Inc. outside the Skrill Group to Sentinel Group Holdings S.A. Paysafe has commenced the process for obtaining the required approvals in connection with Skrill USA Inc.’s money transmitter licences from the relevant US states or territories in order for the Paysafe Group to be able to acquire Skrill USA Inc. and has started to receive regulatory approvals from some of the relevant US states and territories. The transfer of Skrill USA to Sentinel Group Holdings S.A. was carried out at market value and the consideration (which was e5.2 million) has been left outstanding as a loan between Skrill Holdings Limited and Sentinel Group Holdings S.A. In addition, Skrill Holding Limited has also provided Skrill USA Inc. with a funding loan for working capital purposes. Assuming that the required approvals are received in a timely fashion, the Paysafe Group, through Skrill Holdings Limited, will repurchase Skrill USA Inc. on receipt of the relevant approvals and the consideration for that transfer will be the release of Sentinel Group Holdings S.A.’s obligation to repay the e5.2 million loan owed to Skrill Holdings Limited (and therefore Skrill Holdings Limited will not be required to raise any funds to ﬁnance the acquisition). Sentinel Group Holdings S.A. has agreed that it will not sell Skrill USA Inc. to a third party for a period of six months after Completion. If Skrill Holdings Limited has not obtained the relevant approvals to enable Skrill USA Inc. to be transferred to Skrill Holdings Limited within the six month period following Completion, Sentinel Group Holdings S.A. shall be permitted to sell Skrill USA Inc. to a third party. In the event Skrill USA Inc. is sold to a third party, Sentinel Group Holdings S.A. will use reasonable endeavours to sell Skrill USA Inc. for the best possible purchase price, and the proceeds of that sale shall be used to repay the loans put in place between Skrill Holdings Limited and both Sentinel Group Holdings S.A. and Skrill USA Inc., and any excess loan amount that remains outstanding (whether relating to the working capital loan or the consideration for the transfer of Skrill USA Inc.) shall be waived by Skrill Holdings Limited. The Paysafe Group has obtained money transmitter licences in New Jersey, Delaware, Iowa, North Dakota and Idaho and

32 if the Paysafe Group does not acquire Skrill USA Inc., it intends to commence applying for its own money transmitter licences in the remaining states in which they are required. The Directors are not aware of any circumstances that may result in the Paysafe Group being in breach of the terms of its money transmitter licences which would be likely to lead to a withdrawal of such licences or a material restriction on such licences. However, if the Paysafe Group were to violate laws or regulations governing money transmitters or electronic fund transfers, either in the UK, the US or elsewhere, including as a result of any failure by employees of the Paysafe Group to apply correctly the Paysafe Group’s KYC procedures, this could result in a requirement for future compliance, ﬁnes, other forms of liability and/or force the Paysafe Group to change business practices or to cease operations altogether.

The Paysafe Group must comply with money laundering regulation in the UK, the Isle of Man, the US and elsewhere and any failure to do so could result in severe financial and legal penalties The Paysafe Group operates in an industry subject to money laundering regulations. These regulations prohibit, amongst other things, the Paysafe Group’s involvement in transferring the proceeds of criminal activities. Applicable money laundering regulations require firms to put preventative measures in place and to ‘‘know their customers’’ including conducting customer identification and verification and undertaking ongoing monitoring. In addition, regulations require companies to keep records of identity and to train their staff on the requirements of the relevant money laundering regulations. At present, in the UK a senior member of staff needs to be appointed and approved by the FCA to oversee appropriate policies and procedures. In relation to its Asia Gateway service, the Paysafe Group has engaged an outsourced service provider to enable it to provide the service to its merchants. The outsourced service provider does not have a contractual relationship with any of the Paysafe Group’s merchants including the Largest Merchant. The outsourced service provider uses a network of money changers in order to remit settlement funds to the Paysafe Group. Neither the Paysafe Group nor any of its merchants, including the Largest Merchant, has a direct contractual relationship with these money changers. Merchant funds are also remitted from the Paysafe Group’s bank account in Sweden. If the Swedish bank at which the Paysafe Group holds an account determines that the funds remitted to the Paysafe Group’s bank account constitute the proceeds of criminal activities the bank may, in compliance with their regulatory obligations or internal risk and compliance policies, freeze or confiscate the funds of the Paysafe Group’s merchants however the Directors believe, having taken legal advice, that there is a low risk of this occurring. In addition, the Paysafe Group manages the fiscal exposure of such funds being frozen or confiscated by contractually requiring some of the merchants that use the Asia Gateway service, including the Largest Merchant, to absorb the risks of merchant funds being frozen or declined by a bank or financial institution. The merchant funds held in the bank account in Sweden are transferred to the Paysafe Group’s merchants up to three times each week and the Paysafe Group transfers its own revenues from the bank account once a month. As a result, the amount of monies held in the bank account in Sweden at any given time is not material to the Paysafe Group as a whole. The Paysafe Group also receives merchant funds and revenues derived from the operation of the Asia Gateway service through its bank accounts held in the Isle of Man and Malta. Therefore if any action is taken by the Swedish bank to freeze or confiscate the Paysafe Group’s own funds or its merchant funds, the Paysafe Group can opt to divert all new funds derived from the Asia Gateway service to these accounts. Therefore, the Directors believe that if the Paysafe Group’s own funds or those owed to its merchant are frozen or confiscated in Sweden, such actions would not have a material adverse effect on the Paysafe Group’s business or financial condition. In the US and the Isle of Man, the Paysafe Group is also subject to money laundering laws and regulations. Any variation or addition to these regulations (including the situation where the Paysafe Group becomes subject to regulations in other EU jurisdictions after passporting its regulatory licence into that jurisdiction) could impose significant compliance costs on the Paysafe Group respectively or make it more difficult for new merchants or customers to make use of the Paysafe Group’s services and products as a result of more complex provisions or restrictions. The Paysafe Group could be required to learn more about its merchants or customers before opening NETELLERâ accounts, or to monitor its merchants or customers more closely, which could significantly raise the Paysafe Group’s costs or reduce the attractiveness of the Paysafe Group’s product and services. The Paysafe Group monitors developments in this regard and the Directors are not aware of any imminent changes.

33 The Paysafe Group’s customers are resident in over 200 countries and territories. However, the Paysafe Group takes the view that it does not conduct regulated activities in each of these jurisdictions. Rather, Paysafe Group conducts such activity in a limited number of jurisdictions and its wider customer base accesses its services online. The Paysafe Group therefore complies with anti-money laundering regulation in the UK and the Isle of Man and in any other jurisdiction where a member of the Paysafe Group is established and performing activities which would require that member of the Paysafe Group to apply anti-money laundering regulation. The Paysafe Group applies the anti-money laundering regulation of the UK and the Isle of Man in respect of the NETELLERâ service. In respect of the Skrill business, the Paysafe Group complies with anti-money laundering regulations in the UK, unless the regulatory framework in countries where a company is regulated requires adherence to local regulations. For example, in relation to Skrill Canada Inc., the Paysafe Group complies with compliance and anti- money laundering regulation of Canada and in relation to paysafecard, the Paysafe Group adheres to the best practice guidelines of the Federal Financial Supervisory Authority in respect of its subsidiary in Germany and in relation to paysafecard.com Schweiz GmbH, the anti-money laundering regulation in Switzerland. Skrill USA Inc. has previously been subject to three cease and desist orders in the US (in Ohio, West Virginia and Kentucky) in respect of its anti-money laundering compliance matters. The implementation of each of the orders was suspended pursuant to consent orders under which Skrill USA Inc. undertook to improve its anti-money laundering compliance functions. Skrill USA Inc., which is an entity which the Paysafe Group has agreed to buy subject to the receipt of regulatory approval, has received notifications from the regulators in each of Ohio, West Virginia and Kentucky terminating the cease and desist orders. Therefore, the Directors believe that the Paysafe Group has the appropriate processes in place to comply with the anti-money laundering laws and regulations to which it is subject and will become subject. Where a customer is resident in a jurisdiction outside of Europe in which the Paysafe Group does not consider itself to be conducting a regulated activity, the Paysafe Group follows UK money laundering requirements regardless of the residency of that customer. The Directors believe that those processes are of the requisite standard, although there can be no guarantee that they meet all the requirements of other jurisdictions. However, if the Paysafe Group were to violate laws or regulations governing money transmitters or electronic fund transfers, either in the UK, the Isle of Man, the US or elsewhere, including as a result of any failure by employees of the Paysafe Group to apply correctly the Paysafe Group’s KYC procedures, this could result in a requirement for future compliance, fines, other forms of liability and/or force the Paysafe Group to change business practices or to cease operations altogether. Even if the Paysafe Group complies with money laundering laws and regulations, law enforcement agencies could seize merchants’ or customers’ funds that are the proceeds of unlawful activity and the Paysafe Group, its Directors, Senior Managers or other employees could be subject to civil or criminal sanctions, including fines or penalties. Any such action could result in adverse publicity for the Paysafe Group and a number of such seizures could have a material adverse effect on the Paysafe Group’s results of operations, financial condition and future prospects. The Paysafe Group is also subject to rules and regulations imposed by, amongst others, HM Treasury and the US Department of the Treasury’s Office of Foreign Assets Control, regarding watch lists published by such bodies restricting the transfer of funds to certain specifically designated countries. While the Directors believe that the Paysafe Group has in place appropriate systems and procedures to ensure that transfers to merchants or customers in countries on watch lists are not executed there can be no guarantee that such controls are, or will continue to be, effective and any sanctions imposed by any regulatory body on the Paysafe Group for executing a transfer to a country on a watch list could have a material adverse effect on the Paysafe Group’s results of operations, financial condition and future prospects. As a result of the low value of paysafecard e-vouchers, KYC checks are not required to be carried out on customers and, therefore, customers remain anonymous, therefore exposing it to added money laundering risks. paysafecard have put procedures in place to mitigate this risk and these include (i) imposing KYC procedures on a customer if the aggregate value of the vouchers the customer acquires surpasses certain pre-set limits (in accordance with the relevant regulations in Europe, the UK and the US), (ii) prohibiting vouchers issued in one country from being used in another one, and (iii) limiting the frequency of voucher issuance in respect of a single customer. ‘‘my paysafecard’’ conducts standard KYC checks on its customers when new accounts are opened in order to verify the identity of its customers. Additional due diligence and verification is

34 carried out when high risk or suspicious activity is detected. In Germany, the online verification is provided by Deutsche Post AG, which offers the PostIdent online verification solution or by Cybits Holdings AG, which offers verify-U, an electronic ID verification platform.

Online gambling legislation, or regulatory or enforcement action may be taken to prohibit the provision of services to daily fantasy sports (‘‘DFS’’) merchants in the US Approximately two per cent. of the Group’s revenue for the nine months to 30 September 2015 was generated from the DFS vertical. The Paysafe Group and its merchants and customers are subject to various laws and regulations in relation to gambling in the US as set out in Part II (Online Gambling Regulation) of this document. Some states in the US have passed laws or issued regulatory or other guidance classifying DFS as gambling, which is prohibited. The Paysafe Group does not support payment transactions in the US states where DFS has been determined to be unlawful, nor does it provide payment services to DFS merchants in connection with DFS services in those states. In order to ensure that the Paysafe Group does not provide payment services in support of DFS related transactions in a US state in which DFS is currently prohibited or where it may be prohibited in the future, the Paysafe Group deploys BIN blocks and geo location software which identify and then block transactions originating from the prohibited US states.

However, the legal status of DFS in most US states is uncertain. Federal law, in the form of the Unlawful Internet Gambling Enforcement Act 2006, recognises fantasy sports by specifying that fantasy sports meeting certain criteria do not violate that statute. Other earlier federal statutes, most notably the Wire Act and the Professional and Amateur Sports Protection Act 1992, may be construed to apply to fantasy sports but no court or other authority has determined that to be the case and the existence of the ‘‘safe harbor’’ in the Unlawful Internet Gambling Enforcement Act 2006 would seem reasonably to refute any such proposition.

US state positions on DFS vary. Only three US states have enacted statutes expressly addressing fantasy sports. Montana prohibits online fantasy sports whilst Maryland and Kansas permit fantasy sports that meet certain criteria. Several states are considering the introduction of legislation that would expressly permit, regulate or prohibit DFS. State attorney generals and gambling regulators have taken contradictory views on DFS, although, with the notable exception of Nevada and Washington who have taken formal steps indicating that they regard DFS as unlawful, rarely in any formal fashion. One or more state attorney generals are evaluating whether DFS violates their state law. In addition, due to recent controversies involving alleged irregularities by DFS market leaders in the US, the DFS industry is facing increased scrutiny from at least three US state or federal governmental authorities (the New York State Attorney General, the United States Attorneys for the Southern District of New York and the Middle District of Florida). The few US court decisions to have evaluated fantasy sports have rejected challenges based on its alleged illegality.

Although the legal status of DFS in most US states is uncertain, it is possible that a US state or federal governmental authority might determine to impose penalties or seek other recourse against the Paysafe Group in connection with its DFS related payment services activity. If DFS were considered to be illegal gambling the Paysafe Group could face criminal or civil penalties arising from the provision of payment services in support of DFS related transactions. This could have an adverse effect on the Paysafe Group’s reputation, operations and ﬁnancial performance. This could also lead to civil, criminal or regulatory proceedings being brought against the Paysafe Group and/ or its Directors, Senior Managers and employees such as the recent class action claims that have been described on page 319 of this document.

The Paysafe Group believes that its activities in connection with DFS related payment services activity in the US are lawful and it has worked closely and transparently with ﬁnancial institutions in the US (principally banks and card networks) in evaluating the activities of its DFS merchants. Further, as part of the Paysafe Group’s commitment to compliance, it monitors industry related legal and legislative developments closely. If it is formally determined in the courts or additional US state legislatures or regulator agencies that DFS requires licensing or is otherwise unlawful, the Paysafe Group will limit the extent of its operations with respect to DFS merchants in those US states accordingly unless the merchants or the Paysafe Group, as applicable, were properly licensed in accordance with regulation.

35 The Paysafe Group may become an unwitting party to fraud being committed by customers The Paysafe Group is focused on providing trusted services to customers and merchants and ensuring that data and confidential information is transmitted and stored securely. Combatting money laundering and fraud is a significant challenge in the online payment services industry because transactions are conducted between parties who are not physically present, which in turn creates opportunities for misrepresentation and abuse. Online payment companies are especially vulnerable because of the convenience, immediacy and anonymity of transferring funds from one account to another and subsequently withdrawing them. Facilitating financial transactions over the internet creates a risk of fraud and ensuring customer data security, privacy, and ongoing compliance with applicable regulations requires significant capital expenditure. A high percentage of fraudulent transactions for Skrill and Neteller services come in from a relatively small number of countries. In respect of Skrill, the top ten countries for exposure to fraudulent transactions between January and September 2015 were the UK, Germany, the USA, Denmark, China, Turkey, Australia, Brazil, Italy and Japan. In respect of Neteller, the top ten countries for exposure to fraudulent transactions between January and September 2015 were the UK, Italy, Brazil, Germany, Australia, France, Belgium, Tunisia, Mexico and Colombia. The Paysafe Group reserves the right to refuse to accept accounts or transactions from many high-risk countries, internet protocol addresses and e-mail domains and continually updates these screens. The Paysafe Group’s transaction monitoring system identifies various criteria, including the country of origination, in order to detect and monitor fraud and will reject any purported transactions if they appear to be fraudulent. Notwithstanding its ability to locate where a transaction is being made, the Paysafe Group faces significant risks of loss due to money laundering, fraud and disputes between senders and recipients, and if the Paysafe Group is unable to deal effectively with losses from fraudulent transactions the business would be harmed.

The Paysafe Group is subject to counterparty credit risk The Paysafe Group provides its products and services to a variety of contractual counterparties and is therefore subject to the risk of non-payment for products provided and services rendered or non-reimbursement of costs incurred. The contracts which the Paysafe Group enters into may require significant expenditure prior to receipt of relevant payments from the customer and may expose the Paysafe Group to potential credit risk or may require the Paysafe Group to use its available bank facilities in order to meet payment obligations. Payolution, arranges the provision of point-of-sale financing by a bank to customers of e-commerce merchants, whereby the bank purchases the receivables from the merchant on behalf of the customer and subsequently recovers payment from the customers. Payolution manages the receivables on behalf of the bank and, as a result of this business model, it is exposed to the risk that the customer does not pay back the amounts owed to the bank, and therefore there is a risk of incurring losses for the Paysafe Group as the Paysafe Group’s contractual arrangements with the bank exposes the Paysafe Group to all of the credit risk of default. Failure by any customers of e-commerce merchants to pay for services or products provided or to reimburse costs incurred by the Paysafe Group could have a material adverse effect on the Paysafe Group’s cash flows and on the profitability of the relevant contract and, as a result, the financial condition, results of operations and prospects of the Paysafe Group may be adversely affected.

The Paysafe Group depends on the continued growth of online commerce The business of selling goods over the internet is dynamic and continuously evolving. Concerns about fraud, privacy or other matters may discourage customers from continuing to use, or adopting, the internet as a medium of commerce. In countries where the Paysafe Group’s services and online commerce generally have been available for some time, acquiring new customers for the Paysafe Group’s services may be more difficult and costly than it has been in the past. In order to expand its customer base, the Paysafe Group must appeal to, and acquire, customers who historically have used traditional means of commerce or alternative methods to purchase goods and who may be resistant to the concept of e-money or an e-Wallet. If these customers prove to be less active than the Paysafe Group’s existing customers, and the Paysafe Group is unable to gain efficiencies in its operating costs, including the Paysafe Group’s cost of acquiring new customers, this could have a material adverse effect on the Paysafe Group’s results of operations, financial condition and future prospects.

36 Changes in tax law, changes in the Paysafe Group’s effective tax rate or exposure to additional tax liabilities could affect the Paysafe Group’s profitability and financial condition The Paysafe Group carries out its business operations through entities in multiple foreign jurisdictions. As such, the Paysafe Group is required to file corporate income tax returns that are subject to foreign tax laws. The foreign tax liabilities are determined, in part, by the amount of operating profit generated in these different taxing jurisdictions. The Paysafe Group’s effective tax rate, earnings and operating cash flows could be adversely affected by changes in the mix of operating profits generated in countries with higher statutory tax rates as well as by the positioning of the Paysafe Group’s cash balances globally. If statutory tax rates or tax bases were to increase or if changes in tax laws, regulations or interpretations were made that impact the Paysafe Group directly, its effective tax rate, earnings and operating cash flows could be adversely impacted. Any such adverse changes in the applicability of tax to the Paysafe Group could increase the levels of taxation payable by the Paysafe Group which would have an adverse effect on the Paysafe Group’s business, financial condition, results of operations and prospects. In addition to the possibility of a substantial tax burden being imposed on the Paysafe Group, the risk that the Paysafe Group may become subject to an increased level of taxation may result in the Paysafe Group needing to change its corporate or operational structure, which could have a material adverse effect on the Paysafe Group’s business, financial condition, results of operations and prospects. Furthermore, any changes in other jurisdictions to the political and social perception of running a business out of a tax-friendly jurisdiction (such as the Isle of Man) or any action by HMRC or any other tax authority to investigate the Paysafe Group’s tax arrangements could result in adverse publicity and reputational damage for the Paysafe Group which could have an adverse effect on the Paysafe Group’s business, financial condition, results of operations and prospects. Further, if HMRC or any other tax authority is successful in challenging the Paysafe Group’s tax arrangements, the Paysafe Group may be liable for additional tax and penalties and interest related thereto, which may have a significant impact on the Paysafe Group’s business, financial condition, results of operations and prospects.

The Paysafe Group is vulnerable to the economic and political events in Greece On 29 June 2015, the Greek government began imposing certain capital controls which sought to restrict the amount of money being transferred outside the country. On 30 June 2015, Greece failed to make certain required payments to the International Monetary Fund. Assuming the Skrill Acquisition took place on 1 January 2015, the Paysafe Group would have derived approximately 3.6 per cent. of its revenue from Greece, principally through the business of Prepaid Services Company Limited, for the six month period ended 30 June 2015. In August 2015 following the agreement in principle of a new bailout, the Greek government began to gradually ease the imposed capital controls, allowing the transfer out of the country of additional sums of money in certain circumstances. It is unclear how the situation in Greece may continue to unfold, however it is possible that additional or extended capital controls may be introduced by the Greek government, there may be further defaults by the Greek government and/or Greece may exit the European Monetary Union, which would result in immediate devaluation of the Greek currency. The occurrence of any of these events could result in a loss of revenue for the Paysafe Group and may have an adverse effect on the ﬁnancial condition of the Paysafe Group. Prepaid Services Company Limited is in the process of implementing certain risk measures, including distribution monitoring mechanisms and introducing sales limits. The Paysafe Group intends to continue its strategy of diversifying its business in order to further mitigate this risk.

The Paysafe Group may be affected by sections 1471-74 of the United States Internal Revenue Code of 1986, as amended (‘‘FATCA’’) and other cross border automatic exchange of information provisions In light of FATCA, certain non-US financial institutions (‘‘foreign financial institutions’’ or ‘‘FFIs’’) are required to register with the IRS to obtain a Global Intermediary Identification Number (‘‘GIIN’’) and comply with the terms of FATCA, including any applicable intergovernmental agreement (‘‘IGA’’) and any local laws implementing such agreement or FATCA. Based on the current operations and business activities of the Paysafe Group, including the e-Wallet business, the Paysafe Group has registered certain entities within the Paysafe Group, and may be required to register certain entities within the Paysafe Group, as FFIs and will therefore be required to register with the IRS to obtain a GIIN, and required to comply with the terms of any applicable IGA. Failure

37 to comply with FATCA (including as the same may be implemented under the terms of any applicable IGA) could subject certain payments of US source fixed, determinable, annual, or periodical income made to the Paysafe Group to 30 per cent. FATCA withholding tax. Further, as FFIs, the Paysafe Group (and/or certain specific entities within the Paysafe Group) would need to perform diligence on their existing and new customers, provided that their account balances reached certain thresholds, including obtaining self-certifications regarding the account holder’s citizenship or tax residence in the United States. They would then be required to report certain information about their US accountholders to either the IRS or their local tax authorities (which will in turn provide such information to the IRS). This reporting requirement could potentially dissuade customers from doing business with the Paysafe Group. The UK has also entered into agreements with its Crown Dependencies and Overseas Territories to improve international compliance (which are or will be implemented under local law) (‘‘UK FATCA’’). UK FATCA imposes a similar reporting regime to that imposed under FATCA, requiring affected banks and financial institutions to report certain information to their local tax authorities in respect of account holders from the UK, the Crown Dependencies and Gibraltar (which information will in turn be provided to the relevant tax authorities). Unlike FATCA, UK FATCA does not impose any withholding obligation. The requirement under UK FATCA for banks and financial institutions to report certain information in relation to their account holders could, however, also potentially dissuade customers from doing business with the Paysafe Group. It is proposed that UK FATCA will be repealed with effect from 1 January 2017 in light of the UK implementation of the revised EU Directive on Administration Cooperation.

The Paysafe Group may be affected by the Common Reporting Standard for Automatic Exchange of Financial Account Information The United Kingdom, the Isle of Man and a number of other jurisdictions have entered into multilateral arrangements modelled on the Common Reporting Standard for Automatic Exchange of Financial Account Information published by the Organisation for Economic Co-operation and Development (the ‘‘OECD CRS’’). The European Union has also incorporated the CRS into a revised Directive on Administrative Cooperation (‘‘DAC’’) providing the OECD CRS with a legal basis within the EU. The revised DAC came into force as European law on 1 January 2015. To the extent that the OECD CRS and/or the DAC (as applicable) is implemented in any relevant jurisdictions, these arrangements will require affected banks and ﬁnancial institutions to report certain information to their local tax authorities about account holders from the jurisdictions which are party to such arrangements (which information will in turn be provided to the relevant tax authorities). In particular, to the extent implemented in the jurisdictions in which the Paysafe Group are established, the OECD CRS and/or the DAC (as applicable) will require the Paysafe Group to provide certain information to their local tax authorities about their merchants and customers from the jurisdictions which are party to such arrangements (which information will in turn be provided to the relevant tax authorities). If the Paysafe Group’s customers, particularly its NETELLERâ customers, do not wish to disclose their tax residency and/or status to the Paysafe Group, the customers may cease to utilise the services of the Paysafe Group which could have a material adverse effect on the Paysafe Group’s business, ﬁnancial condition, results of operations and prospects.

The Paysafe Group is reliant on key personnel and employees The Paysafe Group depends upon the continued services and performance of its Directors and key senior management. The Directors and key senior management, amongst other things, play a key role in maintaining the Paysafe Group’s culture and in setting the Paysafe Group’s strategic direction. The unexpected departure or loss of one of the Paysafe Group’s Directors or key senior management team could have a material adverse effect on the Paysafe Group’s business and financial performance, and there can be no assurance that the Paysafe Group will be able to attract or retain suitable replacements for such Directors and/or key management in a timely manner, or at all. The Paysafe Group also may incur significant additional costs in recruiting and retaining suitable replacements and avoiding disruption in integrating them into the Paysafe Group’s businesses. In addition, the Paysafe Group’s operations and execution of its business plan depend on the ability of the Paysafe Group to attract, train and retain suitably skilled or qualified personnel with relevant industry and operational experience and to ensure that the Paysafe Group have a robust succession planning system in place. In order for the Paysafe Group to expand its operations in

38 the future it will need to recruit and retain further personnel with suitable experience, qualifications and skill sets capable of advancing the Paysafe Group’s business. There is substantial competition for suitably skilled or qualified personnel with relevant industry and operational experience and there can be no assurance that the Paysafe Group will be able to attract or retain its personnel on similar terms to those on which it currently engages its employees, or at all. If the Paysafe Group is unable to attract or retain suitably skilled or qualified personnel then this could have a material adverse effect on the Paysafe Group’s business and financial performance.

The Paysafe Group may fail to realise the expected benefits of the Skrill Acquisition The Skrill Acquisition completed on 10 August 2015. The Directors believe that the Skrill Acquisition will provide strategic and financial benefits for the Paysafe Group. However, there is a risk that the anticipated benefits will fail to materialise, or that they will be less significant than anticipated, and this may have a significant impact on the Paysafe Group’s financial condition, results of operations and prospects and/or the price of the Ordinary Shares and the Paysafe Group’s ability to pay dividends.

As a result of the Skrill Acquisition the Paysafe Group may fail to retain key management or other personnel The calibre and performance of the Paysafe Group’s senior management and other key employees, taken together, is critical to the success of the Paysafe Group and, while incentive plans are put in place for key personnel, there can be no assurance that Completion will not result in the departure of personnel from the Paysafe Group during the integration process following Completion. Failure of the Paysafe Group to put in place new long term incentive plans/ arrangements and otherwise remunerate employees appropriately could result in loss of key personnel. The loss of a signiﬁcant number of management or key employees could adversely affect both the Paysafe Group’s ability to conduct its businesses (through an inability to execute business operations and strategies effectively) and the value of those businesses.

Management distraction or overstretch in connection with the integration process following completion of the Skrill Acquisition could have an adverse effect on the business of the Paysafe Group The Directors anticipate benefits and operational efficiencies as a result of the Completion of the Skrill Acquisition. However, the Paysafe Group will be required to devote significant management attention and resources to integrating the Skrill Group’s business practices and operations. Furthermore, the Paysafe Group will operate businesses across multiple time zones and, although regulatory and operational decision-making will often be undertaken by each of the businesses locally, co-ordinating its decision-making across all the businesses in the Paysafe Group will present challenges to the Paysafe Group’s management team. There is a risk that the challenges associated with managing the Paysafe Group will result in management distraction or overstretch and that consequently the underlying businesses will not perform in line with management or shareholder expectations.

PART B – RISKS RELATING TO THE ORDINARY SHARES Admission of the Ordinary Shares may not occur when expected Although the Company has applied for admission of the Ordinary Shares to the premium segment of the Ofﬁcial List and to trading on the Main Market, and it is expected that these applications will be approved, the Paysafe Group can give no assurance that such applications for admission to the Ofﬁcial List or admission to trading on the Main Market will be approved by the FCA or the London Stock Exchange. See the ‘‘Expected Timetable of Principal Events’’ on page 46 of this document for further information on the expected dates of these events.

The share prices of publicly traded companies can be highly volatile Publicly traded securities from time to time experience significant price and volume fluctuations that may be unrelated to the operating performance of the companies that have issued them. In addition, the market price of the Ordinary Shares may prove to be highly volatile. The market price of the Ordinary Shares may fluctuate significantly in response to a number of factors, many of which are beyond the Paysafe Group’s control, including: * changes in financial estimates by securities analysts; * changes in market valuation of similar companies;

39 * announcements by the Paysafe Group of significant contracts, acquisitions, strategic alliances, joint ventures or capital commitments; * additions or departures of key personnel; * any shortfall in revenues or net income or any increase in losses or decrease in profits from levels expected by securities analysts; * future issues or sales of Ordinary Shares; and * stock market price and volume fluctuations. Any of these events could result in a material decline in the price of the Ordinary Shares.

Future sales of Ordinary Shares could depress the market price of the Ordinary Shares The Paysafe Group is unable to predict whether substantial numbers of Ordinary Shares will be sold in the open market. Any sales of substantial numbers of Ordinary Shares in the public market, or the perception that such sales might occur, could result in a material adverse effect on the market price of the Ordinary Shares and could impair the Paysafe Group’s ability to raise capital through the sale of additional equity securities.

Any future issue of Ordinary Shares will further dilute the holdings of Shareholders and could adversely affect the market price of Ordinary Shares The Company has no current plans for an offering or other issue of Ordinary Shares other than in connection with the Paysafe Employee Share Plans and the FANS Acquisition. However, it is possible that the Company may decide to offer additional Ordinary Shares in the future either to raise capital or for other purposes. If Shareholders did not take up such offer of Ordinary Shares or were not eligible to participate in such offering, their proportionate ownership and voting interests in the Company would be reduced and the percentage that their Ordinary Shares would represent of the total issued share capital of the Company would be reduced accordingly. An additional offering, or signiﬁcant sales of shares by major shareholders, could have a material adverse effect on the market price of Ordinary Shares as a whole.

Overseas Shareholders may be subject to exchange rate risks The Ordinary Shares are priced in pence, and will be quoted and traded in pence. In addition, any dividends the Company may pay will be declared and paid in Pounds Sterling. Accordingly, holders of Ordinary Shares resident outside the UK are subject to risks arising from adverse movements in the value of their local currencies against Pounds Sterling, which may reduce the value of the Ordinary Shares, as well as that of any dividends paid.

Payment of dividends There can be no assurance that Paysafe will declare dividends or as to the level of any dividends. The approval of the declaration and amount of any dividends of Paysafe is subject to the discretion of the directors of Paysafe (and, in the case of any final dividend, the discretion of the Shareholders) at the relevant time and will depend upon, among other things, the Paysafe Group’s earnings, financial position, cash requirements and availability of distributable profits, as well as the provisions of relevant laws and/or generally accepted accounting principles from time to time.

Overseas Shareholders may only have limited ability to bring actions or enforce judgments against the Company or its Directors The ability of an Overseas Shareholder to bring an action against the Company may be limited under law. The Company is a public limited company incorporated in the Isle of Man and the rights of the Company’s Shareholders are governed by Manx law and the Company’s Articles of Association. These rights differ from the rights of shareholders in typical US corporations and some other non-Isle of Man or non-UK corporations. It may not be possible for an Overseas Shareholder to enforce any judgments in civil or commercial matters or any judgments in securities laws of countries other than the Isle of Man against some or all or the Directors or executive ofﬁcers of the Company who are resident in the Isle of Man or countries other than those in which judgment is made.

40 The proposed financial transactions tax (‘‘FTT’’) On 14 February 2013, the Commission published a proposal (the ‘‘Commission’s Proposal’’) for a Directive for a common financial transaction tax in Belgium, Germany, Estonia, Greece, Spain, France, Italy, Austria, Portugal, Slovenia and Slovakia (the ‘‘participating Member States’’). The Commission’s Proposal has very broad scope and could, if introduced, apply to certain dealings in the Ordinary Shares or rights to acquire the Ordinary Shares (including secondary market transactions) in certain circumstances. Primary market transactions referred to in Article 5(c) of Regulation (EC) No 1287/2006 are expected to be exempt. Under the Commission’s Proposal, FTT could apply in certain circumstances to persons both within and outside of the participating Member States. Generally, it would apply to financial transactions where at least one party is a financial institution, and (a) one party is established in a participating Member State or (b) the financial instrument which is subject to the transaction is issued in a participating Member State. A financial institution may be, or be deemed to be, ‘‘established’’ in a participating Member State in a broad range of circumstances, including by merely transacting with a person established in a participating Member State. Joint statements issued by participating Member States indicate an intention to implement the FTT by 1 January 2016. However, the FTT proposal remains subject to negotiation between the participating Member States and the scope of any such tax is uncertain. Additional Member States may decide to participate. Prospective holders of the Ordinary Shares are strongly advised to seek their own professional advice in relation to the FTT.

FATCA withholding may be imposed in certain circumstances on payments made in respect of the Ordinary Shares After 31 December 2018, the Paysafe Group may be required to withhold tax at a rate of 30 per cent. on some portion or all of the payments it makes to Shareholders in respect of the Ordinary Shares to the extent that they are considered ‘‘foreign passthru payments’’ and the Ordinary Shares are held in an account at a ﬁnancial institution that is not itself FATCA compliant. If Paysafe is required to withhold amounts under or in connection with FATCA from any payments in respect of the Ordinary Shares, Shareholders and beneﬁcial owners of the Ordinary Shares will not be entitled to receive any gross up or other additional amounts to compensate them for such withholding.

Paysafe may be considered a passive foreign investment company (‘‘PFIC’’) for U.S. federal income tax purposes Although Paysafe carries large cash balances in connection with its operations, Paysafe does not believe that it is a PFIC based on the present nature of its activities, including the e-Wallet and payment processing businesses, and the present composition of its assets (including goodwill associated with the e-Wallet and payments processing businesses), and does not expect to become a PFIC in the future. However, PFIC status is factual in nature, may depend in part on fluctuations in the market price of the Ordinary Shares, is determined annually, and generally cannot be determined until the close of the taxable year. No assurances can be provided that Paysafe will not be considered a PFIC with respect to any taxable year. If Paysafe is classified as a PFIC, for any taxable year, materially adverse tax consequences are likely to arise for certain US Shareholders, in terms of tax liability and return filing requirements, and Paysafe does not expect to furnish the information necessary for US Investors to make ‘‘qualified electing fund’’ elections.

41 IMPORTANT INFORMATION

No person has been authorised to give any information or make any representations other than those contained in this document and, if given or made, such information or representations must not be relied upon as having been authorised by the Company, Deutsche Bank or Lazard. Without prejudice to any legal or regulatory obligation on the Company to publish a supplementary prospectus pursuant to section 87G of FSMA and Rule 3.4 of the Prospectus Rules, the publication or delivery of this document shall not, under any circumstances, create any implication that there has been no change in the affairs of the Company and/or the Paysafe Group since the date of this document or that the information in this document is correct as at any time subsequent to its date. This document is being furnished by the Company solely for the purpose of admission of the Ordinary Shares to the Ofﬁcial List and to trading on the Main Market. Any reproduction or distribution of this document, in whole or in part, or any disclosure of its contents or use of any information herein for any purpose other than this purpose is prohibited, except to the extent that such information is otherwise publicly available. This document is not intended to provide the basis of any credit or other evaluation and should not be considered as a recommendation by the Company that any recipient of this document should purchase or subscribe for the Ordinary Shares.

Overseas Shareholders The implications of Admission for, and the distribution of this document to Overseas Shareholders may be affected by the laws of the relevant jurisdictions in which such Overseas Shareholders are located. Such Overseas Shareholders should inform themselves about and observe all applicable legal requirements. It is the responsibility of any person into whose possession this document comes to satisfy himself as to his full observance of the laws of the relevant jurisdiction in connection with Admission and the distribution of this document, including the obtaining of any governmental, exchange control or other consents which may be required and/or compliance with other necessary formalities which are required to be observed and the payment of any issue, transfer or other taxes due in such jurisdiction. Overseas Shareholders should consult their own legal and tax advisers with respect to the legal and tax consequences of Admission in their particular circumstances.

Forward looking statements This document contains forward looking statements which are based on the beliefs, expectations and assumptions of the Directors about the Paysafe Group’s businesses. All statements other than statements of historical fact included in this document may be forward looking statements. Generally, words such as ‘‘will’’, ‘‘may’’, ‘‘should’’, ‘‘could’’, ‘‘estimates’’, ‘‘continue’’, ‘‘believes’’, ‘‘expects’’, ‘‘aims, ‘‘targets’’, ‘‘projects’’, ‘‘intends’’, ‘‘anticipates’’, ‘‘plans’’, ‘‘prepares’’, ‘‘seeks’’ or, in each case, their negative or other variations or similar or comparable expressions identify forward- looking statements. These forward looking statements are not guarantees of future performance, and there can be no assurance that the expectations reﬂected in such forward looking statements will prove to have been correct. Rather, they are based on the current beliefs, expectations and assumptions and involve known and unknown risks, uncertainties and other factors, many of which are outside the control of the Company and are difﬁcult to predict, that may cause actual results, performance, plans, objectives, achievements or events to differ materially from those express or implied in such forward looking statements. Undue reliance should, therefore, not be placed on such forward looking statements. Any forward looking statements contained in this document are subject to (among other things) the risk factors described in the ‘‘Risk Factors’’ section of this document. New factors will emerge in the future, and it is not possible to predict which factors they will be. In addition, the impact of each factor on the Paysafe Group’s businesses or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those described in any forward looking statement or statements cannot be assessed, and no assurance can, therefore be provided that assumptions will prove correct or that expectations and beliefs will be achieved. Any forward looking statement contained in this document based on past or current trends and/or activities of the Paysafe Group businesses should not be taken as a representation that such

42 trends or activities will continue in the future. No statement in this document is intended to be a proﬁt forecast or to imply that the earnings of the Paysafe Group for the current year or future years will match or exceed historical or published earnings of the Paysafe Group. Forward looking statements contained in this document do not in any way seek to qualify the working capital statement contained in paragraph 16 of Part XI (Additional Information). Each forward looking statement speaks only as at the date of this document and is not intended to give any assurance as to future results. The Company and/or its Directors expressly disclaim any obligation or undertaking to release publicly any updates or revisions to any forward looking statements contained herein as a result of new information, future events or other information, except to the extent required by the Listing Rules, the Disclosure and Transparency Rules, the Prospectus Rules, the rules of the London Stock Exchange or by applicable law.

Presentation of Financial Information Unless otherwise stated in this document: * financial information relating to the Paysafe Group for the six months ended 30 June 2015 has been extracted without material adjustment from the reported on financial statements and the reported on financial information for the six month period ended 30 June 2015 as set out in Section B of Part IV (Financial Information of the Paysafe Group) of this document; * financial information relating to the Paysafe Group for the three years ended 31 December 2014 has been extracted without material adjustment from the audited financial information for the three years ended 31 December 2014 which is set out on pages 179 and 217 of the March 2015 Prospectus and incorporated by reference into this document; * financial information relating to the Skrill Group for the six month period ended 30 June 2015 and for the year ended 31 December 2014 has been extracted from the reported on financial statements and the reported on financial information for the six month period ended 30 June 2015 and the audited financial statements and audited financial information for the year ended 31 December 2014 as set out in Sections B and D of Part VI (Financial Information of the Skrill Group) of this document and converted to US dollars for comparability; and * financial information relating to the Skrill Operating Group for the three years ended 31 December 2013 has been extracted from the audited financial statements and the audited financial information for the three years ended 31 December 2013 which is set out on pages 245 to 288 of the March 2015 Prospectus and incorporated by reference into this document and the audited financial information for the financial year ended 31 December 2014 as set out in Section D of Part VI (Financial Information of the Skrill Group) of this document and converted to US dollars for comparability. The underlying financial information stated in Euro has been translated into US dollars as follows: * monetary items: translated at closing rates applicable at the appropriate period end; * non-monetary items: translated at historic rates and average rates for movements during the period; and * income statement items: translated at average rates during the applicable period. Unless otherwise stated, financial information in this document relating to the Paysafe Group, the Skrill Group and the Skrill Operating Group has been prepared in accordance with IFRS.

Pro Forma Financial Information In this document, any reference to ‘‘pro forma’’ financial information is to information which has been extracted without material adjustments from the unaudited pro forma financial information contained in Part VII (Unaudited Pro Forma Financial Information). The unaudited pro forma statement information contained in Part VII (Unaudited Pro Forma Financial Information) is based on the historical financial information of the Paysafe Group incorporated by reference into this document and the historical financial information of the Skrill Group contained in Part VI (Financial Information of the Skrill Group), respectively. The unaudited pro forma statement of net assets has been prepared to illustrate the effect on the net assets of Paysafe as if the Skrill Acquisition had occurred at 1 January 2015. The unaudited pro forma income statement has been prepared to illustrate the effect on the profit and loss of Paysafe as if the Skrill Acquisition and the Rights Issue had taken place on 1 January

43 2015 based on the income statement of the Paysafe Group for the six month period ended 30 June 2015, adjusted to reflect the net income of the Skrill Group for the six month period to 30 June 2015. The unaudited pro forma net assets statement and the unaudited pro forma income statement have been prepared for illustrative purposes only and because of its nature, addresses a hypothetical situation and do not, therefore, represent the Paysafe Group’s actual financial position or results. The pro forma financial information has been prepared under IFRS as adopted by the EU and on the basis set out in Part VII (Unaudited Pro Forma Financial Information) and in accordance with Annex II to the PD Regulation. The pro forma financial information is stated on the basis of the accounting policies of Paysafe.

Non-GAAP financial measures The document includes non-GAAP measures and ratios, including EBITDA, which are not measures of financial performance under IFRS. EBITDA, as calculated by the Paysafe Group for the years ended 31 December 2012, 2013 and 2014 is calculated by the Paysafe Group as set out on pages 164 to 165 of the March 2015 Prospectus and has been incorporated by reference into this document and for the six month period ended 30 June 2015 in paragraph 1 of Part III (Operating and Financial Review of the Paysafe Group) and by the Skrill Operating Group for the six months ended 30 June 2015 and the years ended 31 December 2012, 2013 and 2014 in paragraph 1 of Part V (Operating and Financial Review of the Skrill Operating Group). EBITDA and other non-GAAP measures should not be considered in isolation or as an alternative to profit from operations, cash flow from operating activities or other financial measures of the Paysafe Group’s results of operations or liquidity derived in accordance with IFRS. See Part III (Operating and Financial Review of the Paysafe Group), pages 160 to 176 of the March 2015 Prospectus which is incorporated by reference into this document and Part V (Operating and Financial Review of the Skrill Operating Group) for a reconciliation of EBITDA to profit/(loss) before tax. The Paysafe Group includes EBITDA and other non-GAAP measures in this document, because it believes that they are useful measures of the Paysafe Group’s, the Skrill Group’s or the Skrill Operating Group’s performance and liquidity. Other companies, including those in the Paysafe Group’s, the Skrill Group’s and the Skrill Operating Group’s industry, may calculate similarly titled financial measures in a manner different to that of the Paysafe Group, the Skrill Group’s or the Skrill Operating Group. Because all companies do not calculate these financial measures in the same manner, the Paysafe Group’s, the Skrill Group’s and the Skrill Operating Group’s presentation of such financial measures may not be comparable to other similarly titled measures of other companies. EBITDA is not audited.

Currencies In this document, references to ‘‘£’’, ‘‘pence’’, ‘‘sterling’’, ‘‘Pounds Sterling’’ or ‘‘GBP’’ are to the lawful currency of the United Kingdom and references to ‘‘US dollars’’, ‘‘US$’’, ‘‘$US’’, ‘‘US¢’’ or ‘‘cents’’ are to the lawful currency of the United States. The abbreviation ‘‘e’’ represents the euro, the European single currency, the abbreviation ‘‘C$’’ represents the Canadian dollar and the abbreviation ‘‘HK$’’ represents the Hong Kong dollar.

No Profit Forecast No statement in this document is intended as a profit forecast and no statement in this document should be interpreted to mean that earnings per Ordinary Share for the current or future financial years would necessarily match or exceed the historical published earnings per Ordinary Share.

Rounding Percentages and certain amounts included in this document have been rounded for ease of presentation. Accordingly, figures shown as totals in certain tables may not be the precise sum of the figures that precede them. Percentages and amounts reflecting changes over time periods relating to financial and other data set out in Part I (Information on the Paysafe Group) are calculated using the numerical data in the financial information set out on pages 177 to 218 of the March 2015 Prospectus which has been incorporated by reference into this document) and in Part VI (Financial Information of the Skrill Group), respectively, and the historical financial information of the Skrill Group set out on pages 238 to 451 of the March 2015 Prospectus (which has been incorporated by reference into this

44 document), or the tabular presentation of other data (subject to rounding) contained in this document, as applicable, and not using the numerical data in the narrative description thereof. Accordingly, in certain instances the sum of the numbers in a column or a row in tables contained in this document may not conform exactly to the total ﬁgure given for that column or row. Some percentages in tables in this document have also been rounded and accordingly the totals in these tables may not add up to 100 per cent.

Third party information Where third party information has been used in this document, the source of such information has been identiﬁed. The Company conﬁrms that such information has been accurately reproduced and, so far as it is aware and has been able to ascertain from information published by such third parties, no facts have been omitted which would render the reproduced information inaccurate or misleading.

Time Any reference to a time in this document is, unless otherwise stated, a reference to a time in London, England.

Website The contents of the Paysafe Group’s website or of any website accessible via hyperlinks from the Paysafe Group’s website are not incorporated into, and do not form part of, this document.

45 EXPECTED TIMETABLE OF PRINCIPAL EVENTS

Each of the times and dates in the table below is indicative only and may be subject to change. Please read the notes to this timetable set out below.

2015 Publication of Prospectus 18 December Last day of trading of Ordinary Shares on AIM 22 December Expected delisting of Ordinary Shares from AIM 8.00 a.m. on 23 December Expected admission of the Ordinary Shares to the Ofﬁcial List 8.00 a.m. on 23 December Expected commencement of dealings on the Main Market 8.00 a.m. on 23 December

Notes: (1) The times and dates set out in the expected timetable of principal events above and mentioned in this document, and in any other document issued in connection with Admission are subject to change by the Company, in which event details of the new times and dates will be notiﬁed to the UK Listing Authority, the London Stock Exchange and, where appropriate, to Shareholders. (2) Any reference to a time in this document is to the time in London, England, unless otherwise speciﬁed.

46 DIRECTORS, COMPANY SECRETARY, REGISTERED OFFICE AND ADVISERS

Directors Dennis Jones (Non-Executive Director (Chairman)) Joel Leonoff (President and Chief Executive Officer) Brian McArthur-Muscroft (Chief Financial Officer) Andrew Dark (Non-Executive Director) Ian Francis (Non-Executive Director) Brahm Gelfand (Non-Executive Director) Ian Jenks (Non-Executive Director) Company Secretary Tony Hunter Registered and Head Office Address Audax House 6 Finch Road Douglas IM1 2PT Isle of Man Sponsor and Broker Deutsche Bank AG, London Branch 1 Great Winchester St London EC2N 2DB United Kingdom Financial Adviser Lazard & Co., Limited 50 Stratton Street London W1J 8LL United Kingdom Legal advisers to Paysafe as to Hogan Lovells International LLP English law and US law Atlantic House Holborn Viaduct London EC1A 2FG United Kingdom Legal advisers to Paysafe as to Stikeman Elliott LLP Canadian law 1155 Rene´-Le´vesque Blvd. West, 40th Floor, Montreál, QC Canada Legal advisers to Paysafe as to Cains Advocates Limited Isle of Man law Fort Anne Douglas IM1 5PD Isle of Man Legal advisers to the Sponsor and DLA Piper UK LLP Broker as to English law and US law 3 Noble Street London EC2V 7EE United Kingdom Auditors and Reporting Accountants KPMG Audit LLC Heritage Court 41 Athol Street Douglas IM99 1HN Isle of Man

47 PART I

INFORMATION ON THE PAYSAFE GROUP

1. INTRODUCTION 1.1 The Paysafe Group is a global provider of online and mobile payment processing services. In FY2014 Paysafe processed more than US$20 billion in transactions.1 As at the Latest Practicable Date the number of active merchants and active customers to which Paysafe provided services is as follows: NETBANXâ provided its services to over 53,600 active merchants; NETELLERâ provided its services to over 1.14 million active customers and over 1,500 active merchants; Skrill provided its services to over 2.3 million active customers and over 34,000 active merchants; and paysafecard provided its services to an estimated 12 million active customers and over 2,200 active merchants. As at the Latest Practicable Date, the Paysafe Group employed approximately 1,600 employees and operated offices and data centres in Europe, Canada, the Isle of Man and the United States. 1.2 Paysafe’s vision is to become a leading global payments provider that facilitates transactions from customers to businesses, customers to customers and businesses to businesses. To achieve this vision, Paysafe has defined a set of four strategic initiatives, which are set out at paragraph 10 of this Part I, to strengthen its services offering and expand its market share. 1.3 The Paysafe Group acquired Skrill, a global digital payments company on 10 August 2015. Following Completion, the Paysafe Group offers the Skrill Digital Wallet, which also offers a Prepaid MasterCardâ, paysafecard which provides prepaid payment vouchers, an online digital wallet and a prepaid MasterCardâ and Ukash. The Paysafe Group also offers Payolution which, through its relationships with financial institutions, arranges the provision of point-of-sale financing to merchants giving merchants the ability to extend credit to customers to pay later via invoice once the goods have been received. Through Skrill, the Paysafe Group also acts as a payment service provider, allowing merchants to process card transactions directly without the use of an e-Wallet, provides an instant and low cost bank transfer service and also offers a peer-to-peer (‘‘P2P’’) remittance service which allows customers to send money domestically and internationally using their digital wallets. 1.4 The name of the Company was changed to Paysafe Group plc on 9 November 2015 as the Directors wished to adopt a name for the Company which accurately reflected the business of the Paysafe Group following Completion. The ‘‘Paysafe’’ brand is also expected to reinforce the secure nature of the products and services offered by the Paysafe Group, which is integral to attracting new customers and merchants. 1.5 The Directors believe the new ‘‘Paysafe’’ brand will be a unifying brand across many of the products and services to be offered by the Paysafe Group. The Directors believe that the creation of a unified brand strengthens the Paysafe Group’s position as a leading payments provider over a wide addressable market and the Directors expect the Paysafe Group to benefit from the increased recognition of its products and services as a result of the use of the ‘‘Paysafe’’ brand. The Directors also believe that the unification of its legacy and newly acquired products and services under a single brand presents a single identity to the global market and provides the Paysafe Group with the opportunity to reinforce the benefits of the Skrill Acquisition within the global marketplace. The re-branding strategy will also present opportunities for the Paysafe Group to generate additional revenue from the cross-selling of products to merchants and customers, particularly in relation to the Paysafe Group’s Straight Through Processing division. 1.6 Paysafe notified the London Stock Exchange of its wish to cancel the admission of its Ordinary Shares to trading on AIM on 25 November 2015. Cancellation will take effect on the issue of a dealing notice by the FCA, which is expected to be issued by 23 December 2015. Applications have been made, respectively, to the FCA and to London Stock Exchange for all of the ordinary share capital of the Company, being the Ordinary Shares in issue as at the date of this document to be admitted to the premium listing segment of the

1 A transaction for these purposes in relation to the NETELLERâ business is an upload by a member, a withdrawal by a member, a payment from a member to a merchant, a payment from a merchant to a member or a money transfer between members.

48 Ofﬁcial List and to trading on the Main Market. It is expected that Admission will become effective and that dealings will commence in the Ordinary Shares on the London Stock Exchange at 8.00 a.m. on 23 December 2015. 1.7 The Paysafe Group derives its revenue from two key segments, being the NETELLERâ (Stored Value) and the NETBANXâ (Straight Through Processing) segments. NETELLERâ is an online stored value account which allows customers to make instant and secure guaranteed payments over the internet. Within its NETELLERâ segment, Paysafe Group is also developing its new payment card services division which offers merchants with a range of card issuing programmes. NETBANXâ provides a payment gateway service for transactions where the customer is ‘‘not present’’. As part of the NETBANXâ segment, the Paysafe Group also provides the Asia Gateway service. Please see paragraph 5 of this Part I for a detailed overview of the Paysafe Group’s business operations. As part of its ongoing reorganisation following the completion of the acquisition of the Skrill Group, the Paysafe Group will in future be reporting under three divisions: Processing; Digital Wallets; and Prepaid. The Processing division will be comprised of Straight Through Processing which includes the Asia Gateway and acquiring services as well as the Payolution and FANS businesses, the Digital Wallets division will be comprised of the NETELLERâ and Skrill digital wallet services businesses together with the Card Services business and the Prepaid division will be comprised of the paysafecard and Ukash businesses. The Paysafe Group plans to report its 2015 annual results in accordance with this divisional structure. Also, as part of the reorganisation and the rebranding of the Group to the Paysafe Group, the NETBANXâ brand will be retired and payment gateway and bureau services will be sold under the Paysafe brand. The Ukash brand is also being retired and going forward Prepaid services will all be sold under the paysafecard brand.

2. MARKET OVERVIEW 2.1 The Paysafe Group operates in the fast growing digital payments industry, which provides services enabling customers and merchants to make, receive and accept payments over the internet. The digital payments market continues to grow and innovate, driven by changes including the ongoing increase in internet penetration, the rapid adoption of smartphone and tablet devices, the increase in e-commerce spending and the emergence of segments such as micropayments, Voice over internet Protocol (‘‘VoIP’’), internet-based gambling and online gaming. The overall use of digital payments has increased, as traditional ‘‘bricks-and-mortar’’ companies look to expand their online presence to supplement their offline businesses and internet companies continue to increase their share of the overall transaction volume. 2.2 The Paysafe Group targets several end markets which strongly benefit from trends towards online transactions and in which the Directors believe that the Paysafe Group has a competitive advantage given its diversified product portfolio and establishment of a global network of partners, merchants and customers, that it has built over time. These high growth end markets can be summarised in three different verticals: (a) online gambling, which includes gambling and sports betting activities; (b) e-commerce, which includes online retail purchases of physical and digital goods; and (c) online remittance which includes both domestic and cross-border money transfers. 2.3 The transaction value of the global e-commerce market is estimated to grow from a total of US$879 billion in 2013 to US$2,000 billion in 2018 (CAGR of 19 per cent.)2 and the global online gross gambling yield is estimated to grow from US$40 billion in 2013 to US$49 billion in 2017 (CAGR of 5 per cent.)3. 2.4 While the digital payments industry is fast growing, it is largely dominated by a few large global operators, with a number of smaller companies offering niche or specialist digital payment solutions. Due to the breadth and depth of the Paysafe Group’s product offerings,

2 Sources: GBGC, as at July 2014, Ericsson Mobility Report June 2014, Worldpay cited by Payments cards and Mobile, February 2014, Your global guide to alternative payments, second edition, Mckinsey & Company; The keys to driving broad consumer adoption of e-Wallets and mobile payments, January 2014 3 Sources: GBGC, as at July 2014, Ericsson Mobility Report June 2014, Worldpay cited by Payments cards and Mobile, February 2014, Your global guide to alternative payments, second edition, Mckinsey & Company; The keys to driving broad consumer adoption of e-Wallets and mobile payments, January 2014

49 the Paysafe Group competes against a broad range of digital payment players, including payment service providers, alternative online / mobile payment vendors and traditional payment companies (being banks, merchant acquirers and money transfer operators). The Directors believe that the Paysafe Group’s diversiﬁed product portfolio combined with its large, complex and growing network of banks, payment providers, customers and merchants, provides the Paysafe Group with a platform to expand its market share. With its wide portfolio of products and services, recently complemented by the US Acquisitions, the Directors believe the Paysafe Group is well positioned to become a digital payments provider of choice for customers and merchants seeking instantaneous payment methods. 2.5 Moreover, internet access is becoming ubiquitous in both developed and emerging markets, mainly driven by 3G and 4G services and the proliferation of smartphones and tablet devices. The Directors believe that the combination of the digital wallet and the prepaid card is set to capitalise on this trend, unlocking substantial opportunities for the Paysafe Group to increase its market share and consolidate its position as a leader and an innovator in the digital payments industry.

3. PAYSAFE GROUP CORPORATE HISTORY 3.1 The Paysafe Group and its predecessor businesses have been involved in the payments sector since 1996. In 1996, NETBANXâ was founded as an e-commerce payment gateway. In June 1999, Stephen Lawrence, the founder and major shareholder of the NETeller Group, conceived the idea of an ‘‘e-Wallet’’ that could be used to fund internet based transactions without the security risk of processing each transaction at each separate merchant site. In August 1999, John Lefebvre teamed up with Stephen Lawrence to develop the concept and to assist with raising capital. 3.2 At the time, the NETeller Group believed that the most receptive market segment to its ‘‘e- Wallet’’ concept was the online gambling market, as merchants appeared to be demanding payment processing innovation. The NETeller Group was established to develop a money transfer system combining the pervasiveness of the internet with the existing financial infrastructure of the international banking system. 3.3 The website and database for www.neteller.com was developed during the first half of 2000. NETeller Inc. was incorporated in May 2000 and the NETeller Group began processing transactions in July 2000. Uptake of the NETELLERâ system gathered momentum and then grew rapidly as customers and merchants endorsed the ease of use. The growth was supported by the increasing number of methods by which customers could fund their NETELLERâ accounts. 3.4 The Company was incorporated as a private company, NETeller Limited, under the laws of the Isle of Man on 31 October 2003 and was registered as a public company on 1 April 2004. With effect from 31 December 2003, NETeller Inc., the former holding company of the NETeller Group, and up to that date the principal operating company in the NETeller Group, transferred the business and undertaking of the NETeller Group to the Company and its subsidiary, NT Services. 3.5 On 13 November 2008, the Company changed its name from NETeller plc to Neovia Financial plc as part of a wider rebranding strategy and to differentiate the holding company of the NETeller Group from its operating brands of NETELLERâ, NETBANXâ and Net+. 3.6 In February 2011, Neovia Financial plc acquired substantially all of the assets of 7012985 Canada Inc. and its affiliated companies and changed its name to Optimal Payments plc on 1 March 2011. The directors believe the acquisition diversified the Company’s merchant base and provided the Company with a strong presence in North America. The Company is the Paysafe Group’s ultimate holding company. 3.7 On 23 July 2014, Paysafe completed the acquisition of TK Global Partners, LP (‘‘Meritus Payment Solutions’’), a payment processer based in California (the ‘‘Meritus Acquisition’’) and the trade and assets of Global Merchant Advisors, Inc. (‘‘GMA’’), a US based online payments company (the ‘‘GMA Acquisition’’ and together with the Meritus Acquisition, the ‘‘US Acquisitions’’). These acquisitions strengthened the Paysafe Group’s position in the United States and the Directors believe that it will provide opportunities for continued growth in the United States.

50 3.8 On 15 October 2014, Paysafe completed the acquisition of the entire issued share capital of Petal Payments Limited (now known as Optimal Payments Merchant Services (Mauritius) Limited) (the ‘‘Mauritius Acquisition’’). 3.9 On 22 May 2015, Paysafe completed the acquisition of FANS Entertainment Inc. (‘‘FANS’’), a company which specialises in mobile technology development for venues and arenas and offers consultancy services to artists, promoters and festivals with a view to enhancing fan engagement strategy. 3.10 On 10 August 2015 Paysafe completed the acquisition of the entire issued share capital of Sentinel Topco Limited (‘‘Skrill’’), a global digital payments company. The Skrill Group comprises Skrill, paysafecard, Payolution and Ukash. 3.11 On 28 September 2015, the Company obtained the approval of its Shareholders to change the name of the Company from Optimal Payments plc to Paysafe Group plc, and to adopt the New Articles, conditional on Admission.

4. PAYSAFE GROUP STRUCTURE 4.1 The Company is the Paysafe Group’s ultimate holding company and is incorporated in the Isle of Man. The Company has 11 wholly owned subsidiaries: Optimal Payments (UK) Limited, Paysafe Financial Services Limited, PAYS Services Limited, Netpro Limited and Netinvest Limited, each of which is incorporated in England and Wales, Paysafe Callco Inc., NT Services Building Corporation, 1155259 Alberta Limited and Cardload Incorporated, each of which is incorporated in Canada, and Net Group Holdings Limited and Paysafe Finance Limited, each of which is incorporated in the Isle of Man. Paysafe also directly holds 90 per cent. of the shares in NT Services Limited, a company incorporated in Canada, with 1155259 Alberta Limited, a wholly owned subsidiary of Paysafe, holding the remaining 10 per cent. of NT Services Limited. 4.2 Netinvest Limited has two wholly owned subsidiaries, Paysafe Processing Limited which is incorporated in England and Wales and Sentinel Topco Limited which is incorporated in Jersey. Paysafe Processing Limited has seven wholly owned subsidiaries: NETBANXâ B.V. Limited, which is incorporated in the Netherlands, Paysafe Checkout Incorporated, Paysafe Services (Canada) Incorporated, Paysafe Technologies Incorporated and Paysafe Merchant Services Incorporated, each of which is incorporated in Canada, Paysafe Services (Australia) Pty Limited which is incorporated in Australia and NBX Holdings Corporation, which is incorporated in Delaware. NBX Holdings Corporation has two wholly owned subsidiaries, NBX Services Corporation and NBX Merchant Services Corporation, each of which is incorporated in Delaware. NBX Services Corporation holds 98 per cent. of the partnership interests in TK Global Partners, LP and Netbx Services LLC, which is incorporated in Delaware and is a wholly owned subsidiary of NBX Services Corporation, holds the remaining 2 per cent. of the partnership interests in TK Global Partners, LP. 4.3 Sentinel Topco Limited has a wholly owned subsidiary, Sentinel Holdco 2 Limited, which is incorporated in England and Wales and which in turn has a wholly owned subsidiary, Sentinel Midco Limited, which is incorporated in England and Wales. Sentinel Midco Limited has a wholly owned subsidiary, Sentinel Bidco Limited which is incorporated in England and Wales and which has a wholly owned subsidiary, Skrill Group Limited which is a parent company of the Skrill Group and is incorporated in Jersey. Skrill Group Limited has six wholly owned subsidiaries, namely Skrill Capital UK Limited, Digital Payments Europe Limited and MB Acquisitions Limited, which are incorporated in England and Wales, Skrill Capital Limited, which is incorporated in Jersey, Digital Payment Solutions New Zealand Limited, which is incorporated in New Zealand and Digital Payment Solutions Australia Pty Limited, which is incorporated in Australia. Skrill Capital UK Limited is a parent company of Payolution GmbH, which is incorporated in Austria and Payolution GmbH is the parent company of Payolution Schweiz GmbH, which is incorporated in Switzerland. 4.4 MB Acquisitions Limited is the parent company of Skrill Holdings Limited, which is incorporated in England and Wales, and this entity holds the majority of the subsidiary companies within the Skrill Group, which includes the paysafecard Austrian, German, Swiss, Turkish, Gibraltan, US and South American business lines. MB Acquisitions Limited’s other direct subsidiary is MB Employees Nominees Limited, which is established in England and Wales. Skrill Holdings Limited’s direct subsidiaries consist of (a) Skrill Limited, which is

51 incorporated in England and Wales, (b) Skrill International Payments Limited, which is incorporated in England and Wales, (c) Sabemul Beteiligungsverwaltungs GmbH, which is incorporated in Austria, (d) Skrill Services GmbH, which is incorporated in Germany, (e) Skrill Canada Inc., which is incorporated in Canada (f) Skrill Hong Kong Limited, which is incorporated in Hong Kong, (g) Skrill Singapore Pte. Limited, which is incorporated in Singapore and (h) Paysafe Bulgaria EOOD, which is incorporated in Bulgaria. Sabemul Beteiligungsverwaltungs GmbH has two subsidiaries: Smart Voucher Limited, which is the Ukash business and is incorporated in the UK and paysafecard.com Wertkarten GmbH, which is incorporated in Austria, and holds the entities which make up the paysafecard group. 4.5 paysafecard.com Wertkarten GmbH, which is currently part of the Skrill Group, has eleven wholly owned subsidiaries being (a) Prepaid Services Company Limited, which is incorporated in England and Wales, (b) paysafecard.com Wertkarten Vertriebs GmbH, which is incorporated in Austria, (c) cpt Dienstleistungen GmbH, which is incorporated in Germany, (d) paysafecard.com USA Inc., which is incorporated in Delaware, (e) MAC Limited which is incorporated in Gibraltar, (f) paysafecard.com Schweiz GmbH, which is incorporated in Switzerland, (g) paysafecard.com o¨n o¨deme servicleri limited s¸irketi, which is incorporated in Turkey and in which paysafecard.com Wertkarten Vertriebs GmbH holds a minority interest, (h) paysafecard.com Me´xico S.A. de C.V., which is incorporated in Mexico and in which paysafecard.com Wertkarten Vertriebs GmbH holds a minority interest, (i) paysafecard.com Argentina S.R.L, which is incorporated in Argentina and in which paysafecard.com Wertkarten Vertriebs GmbH holds a minority interest, (j) paysafecard.com Croatia D.O.O., which is incorporated in Croatia, and Paysafecard.com USA Inc., which is incorporated in the United States of America. The Skrill Group also holds minority interests in Cybits Holding AG and Live Gamer Inc. 4.6 Paysafe CallCo Inc. has one wholly owned subsidiary, Paysafe ExchangeCo Inc., which is incorporated in Canada. Paysafe ExchangeCo Inc. has a wholly owned subsidiary, FANS Entertainment Inc., which is incorporated in Canada and FANS Entertainment Inc. has a wholly owned subsidiary, FANS Entertainment LLC, which is incorporated in Delaware. 4.7 Net Group Holdings Limited has four wholly owned subsidiaries, Net ID Limited, Netadmin Limited, NETB Limited and Paysafe Merchant Services Limited, each of which is incorporated in the Isle of Man. Paysafe Merchant Services Limited has one wholly owned subsidiary, Optimal Payments Merchant Services (Mauritius) Limited, which is incorporated in Mauritius. 4.8 Optimal Payments (UK) Limited has one wholly owned subsidiary, Optimal Payments (Bulgaria) EOOD, which is incorporated in Bulgaria and Paysafe Financial Services Limited has one wholly owned subsidiary, Optimal Payments Services Incorporated, which is incorporated in Delaware. Optimal Payments Services Incorporated also has a wholly owned subsidiary incorporated in Delaware, OPL Payment Services LLC. 4.9 Prior to Completion, the Skrill Group completed an intra-group restructuring to transfer Skrill USA Inc. outside the Skrill Group to Sentinel Group Holdings S.A. Paysafe has commenced the process for obtaining the required approvals in connection with Skrill USA Inc.’s money transmitter licences from the relevant US states or territories in order for the Paysafe Group to be able to acquire Skrill USA Inc. and has started to receive regulatory approvals from some of the relevant US states and territories. The transfer of Skrill USA Inc. to Sentinel Group Holdings S.A. was carried out at market value and the consideration (which was e5.2 million) was left outstanding as a loan between Skrill Holdings Limited and Sentinel Group Holdings S.A. In addition, Skrill Holding Limited also provided Skrill USA Inc. with a funding loan for working capital purposes. Assuming that the required approvals are received in a timely fashion, Skrill Holdings Limited will repurchase Skrill USA Inc. on receipt of the relevant approvals and the consideration for that transfer will be the release of Sentinel Group Holdings S.A.’s obligation to repay the e5.2 million loan owed to Skrill Holdings Limited (and therefore Skrill Holdings Limited will not be required to raise any funds to ﬁnance the acquisition). 4.10 Sentinel Group Holdings S.A. has agreed that it will not sell Skrill USA Inc. to a third party for a period of six months after Completion. If Skrill Holdings Limited has not obtained the relevant approvals to enable Skrill USA Inc. to be transferred to Skrill Holdings Limited

52 within the six month period following Completion, Sentinel Group Holdings S.A. shall be permitted to sell Skrill USA Inc. to a third party. In the event Skrill USA Inc. is sold to a third party, Sentinel Group Holdings S.A. will use reasonable endeavours to sell Skrill USA Inc. for the best possible purchase price, and the proceeds of that sale shall be used to repay the loans put in place between Skrill Holdings Limited and both Sentinel Group Holdings S.A. and Skrill USA Inc., and any excess loan amount that remains outstanding (whether relating to the working capital loan or the consideration for the transfer of Skrill USA Inc.) shall be waived by Skrill Holdings Limited.

5. BUSINESS OVERVIEW 5.1 The Paysafe Group operates two key business lines: (a) Stored Value which encompasses the Paysafe Group’s NETELLERâ, Net+ prepaid card stored value service, the card services division which encompasses the Paysafe Group’s prepaid card issuing services, the Skrill digital wallet, paysafecard, ‘‘my paysafecard’’ and Ukash, which has been fully integrated into paysafecard; and (b) Straight Through Processing (‘‘STP’’) which encompasses the Paysafe Group’s NETBANXâ brand and payment gateway, bureau services and Asia Gateway service, Skrill Quick Checkout, direct payment gateway and Skrill 1-Tap. 5.2 Paysafe’s stored value business provides the NETELLERâ service in over 200 countries and territories with coverage in 26 currencies and 15 languages. Its Net+ prepaid MasterCard enables physical cash withdrawals and PoS and online transactions using the funds in the stored value account. The STP business processes payments for ‘cardholder not present’ transactions and currently services over 20,000 active merchants in a range of sectors. The Asia Gateway service, which is part of the STP business, uses an outsourced service provider to provide payment processing services to a number of European and Australasian based merchants in respect of their activities in Asia, including China. In FY2013 and in FY2014, the NETELLERâ business generated revenue of US$59.8 million and US$89.6 million, with a gross margin of US$50.3 million and US$76 million respectively, and for the same periods, the STP business generated revenue of US$193 million and US$274.7 million with a gross margin of US$81.1 million and US$112.5 million respectively. 5.3 NETELLERâ generates the majority of its revenues (approximately 61 per cent. in FY2013 and 64 per cent. in FY2014) from the fees it charges the merchants who accept NETELLERâ payments, with the remaining revenue generated from customers, foreign exchange fees in relation to multi-currency transactions and Net+ MasterCard branded prepaid cards. The STP business generates the vast majority of its revenues from the fees it charges to merchants.

Stored Value business NETELLERâ 5.4 The Paysafe Group’s NETELLERâ stored value business (currently comprising the NETELLERâ, Net+ services and the card services division) is an online stored value account which was ﬁrst launched in 1999. The Paysafe Group provides its NETELLERâ services to merchants and customers. The NETELLERâ and Net+ service allows customers to make instant and secure guaranteed payments over the internet in a variety of sectors including entertainment, online gambling, retail, ﬁnancial services and digital content and transfer money to family and friends. As at the Latest Practicable Date, the NETELLERâ service had over 1,148,000 active customers and of this number, approximately 78,000 active customers use the Net+ service (during an average month) in more than 200 countries and territories, with coverage in 26 national currencies and 15 languages. 5.5 When a customer opens a NETELLERâ Account, they are given access to the: (a) Net+ Prepaid MasterCard which allows customers to make payments safely online and in person at millions of MasterCard point-of-sale locations and also serves as a cash card, allowing instant access to stored funds at ATMs worldwide; and (b) NETELLERâ Money Transfer service which is a peer-to-peer payment service.

53 5.6 The NETELLERâ and Net+ service is operated by Paysafe, which is authorised by the FCA as an e-money issuer. Paysafe has passported its e-money services into the European Economic Area using this authorisation. In Japan, the Paysafe Group is in the process of applying for a Funds Transfer Business Operator licence in order to comply with Japanese regulatory requirements. The Directors expect the costs of making the application to be minimal. The Japanese regulator has conﬁrmed that the Paysafe Group may continue to operate its existing business in Japan during the application process. The Directors are not aware of any circumstances that would lead to the application for a Funds Transfer Business Operator licence being rejected by the Japanese regulators.

5.7 Various merchants offer NETELLERâ as a payment method on their website to encourage their customers to make purchases from their website rather than only browsing. In addition, on a purchase by a customer NETELLERâ provides merchants with access to guaranteed funds. Merchants also benefit from reduced customer identification procedures as their customers will have been vetted and approved by NETELLERâ. Customers benefit from a large variety of local and alternative payment methods that can be used to deposit funds into the NETELLERâ account.

5.8 In order to use the NETELLERâ Account, a customer transfers (free of charge) the funds from its bank to the NETELLERâ Account or loads funds using alternative payments methods such as debit or credit card (for a fee of between 1.9 and 4.95 per cent. of the value transferred) or paysafecard (for a fee of between 5.5 and 9.9 per cent. of the value transferred). In March 2015, Paysafe entered into an agreement with BitPay Inc., one of the world’s largest Bitcoin payment providers and processors, which allows NETELLERâ customers to upload funds to be able to top up their NETELLERâ accounts by exchanging Bitcoin into one of the currencies offered by NETELLERâ. The Directors believe that this strategic partnership with BitPay Inc. will result in NETELLERâ processing an increased number of transactions as the acceptance of Bitcoin as a method of payment broadens the scope of the payment options associated with NETELLERâ.

5.9 Customers are then able to use the NETELLERâ Account to pay for online products or services anywhere that NETELLERâ is accepted. The NETELLERâ Account has traditionally been used for online gambling, as it allows the customer to make payments on multiple gambling sites without having to enter their payment details each time. Further, the NETELLERâ Account maintains the customer’s anonymity, enables fast receipt of winnings, and has multicurrency functionality. This means that a customer who has placed a successful bet on one gambling site can quickly use those winnings to place bets on other gambling sites, without having to wait for proceeds to clear a bank account or be credited to a payment card.

5.10 To withdraw money from the NETELLERâ Account, customers can request a bank transfer, a cheque or a banker’s draft for a transaction fee of at least e7.50. Funds in the NETELLERâ Account are also available to spend on the Net+ MasterCard-branded pre-paid card which can be used for online purchases or to withdraw cash at ATMs.

5.11 Paysafe has been a pre-paid MasterCard issuer since 2012 and, as at the Latest Practicable Date, had issued over 1,750,000 cards, of which approximately 73,000 are in use during an average month. In FY2014, the Company processed over 2.4 million Net+ transactions.

5.12 The Paysafe Group launched the NETELLERâ Reward Points Programme (the ‘‘Programme’’) in February 2012, which allows members to earn points on their transactions in the NETELLERâ stored value accounts. Members can redeem these points for merchandise, cash exchange, and other NETELLERâ provided services.

5.13 NETELLERâ generates the majority of its revenues from the fees it charges the merchants who accept NETELLERâ payments. A merchant will be charged a fee (between 2 to 4 per cent.) for every transfer it receives from or makes into a NETELLERâ Account. NETELLERâ also earns fees from foreign exchange and transactions on Net+ pre-paid cards, with the remaining revenues generated from fees on customer deposits and withdrawals, dormant account fees and the retention of funds that have not been reclaimed by customers upon the expiry of accounts.

54 5.14 In November 2014, Paysafe announced the introduction of a new check-out process known as ‘‘NETELLERGO!2’’. NETELLERGO!2 is a ﬂexible and easy-to-use online checkout page, which allows merchants to easily offer customers without a NETELLERâ stored value account the ﬂexibility to use multiple payment methods when making payments online. Merchants also have the opportunity to offer the NETELLERâ stored value service as a global payment method on their checkout page.

5.15 In providing NETELLERGO!2, Paysafe bears the risk of all technical integration and enters into contracts with various payment method providers in order to ensure that various payment methods can be offered through NETELLERGO!2. Merchants beneﬁt from the use of a consolidated and integrated system and are not required to engage in complex contractual negotiations with multiple payment providers in order to provide their customers with payment ﬂexibility. Further, the NETELLERGO!2 system obtains and consolidates all payments due to merchants and deposits the payments in one account, removing the requirement for merchants to open bank accounts in various jurisdictions. NETELLERGO!2 launched on 9 December 2014 and in September 2015, the Paysafe Group entered into an agreement wth IDC/Games, a games publisher that specialises in massively multiplayer online free-to-play online games, to intergrate the NETELLERGO!2 solution into its gaming offering.

5.16 In the US, Paysafe offers its NETELLERâ stored value account service and Net+ prepaid cards to merchants and customers. The Paysafe Group’s NETELLERâ business is regarded as a money transmission business in the US. Money transmitting businesses are subject to numerous regulations in the US at the federal and state levels. The Paysafe Group has obtained money transmitter licences in New Jersey, Delaware, Iowa, North Dakota and Idaho and if the Paysafe Group does not acquire Skrill USA Inc., it will obtain money transmitter licences in the remaining states in which they are required. Currently, the Paysafe Group’s NETELLERâ business in the US is sponsored by Sutton Bank with Sutton Bank carrying out the regulated money transmitting service on behalf of the Paysafe Group.

5.17 Prior to Completion, the Skrill Group completed an intra-group restructuring to transfer Skrill USA Inc. outside the Skrill Group to Sentinel Group Holdings S.A. Paysafe has commenced the process for obtaining the required approvals in connection with Skrill USA Inc.’s money transmitter licences from the relevant US states or territories in order for the Paysafe Group to be able to acquire Skrill USA Inc. and has started to receive regulatory approvals from some of the relevant US states and territories. The transfer of Skrill USA to Sentinel Group Holdings S.A. was carried out at market value and the consideration (which is e5.2 million) was left outstanding as an loan between Skrill Holdings Limited and Sentinel Group Holdings S.A. In addition, Skrill Holding Limited has also provided Skrill USA Inc. with a funding loan for working capital purposes. Assuming that the required approvals are received in a timely fashion, Skrill Holdings Limited will repurchase Skrill USA Inc. on receipt of the relevant approvals and the consideration for that transfer will be the release of Sentinel Group Holdings S.A.’s obligation to repay the e5.2 million loan owed to Skrill Holdings Limited (and therefore Skrill Holdings Limited will not be required to raise any funds to ﬁnance the acquisition).

5.18 Sentinel Group Holdings S.A. has agreed that it will not sell Skrill USA Inc. to a third party for a period of six months after Completion. If Skrill Holdings Limited has not obtained the relevant approvals to enable Skrill USA Inc. to be transferred to Skrill Holdings Limited within the six month period following Completion, Sentinel Group Holdings S.A. shall be permitted to sell Skrill USA Inc. to a third party. In the event Skrill USA Inc. is sold to a third party, Sentinel Group Holdings S.A. will use reasonable endeavours to sell Skrill USA Inc. for the best possible purchase price, and the proceeds of that sale shall be used to repay the loans put in place between Skrill Holdings Limited and both Sentinel Group Holdings S.A. and Skrill USA Inc., and any excess loan amount that remains outstanding (whether relating to the working capital loan or the consideration for the transfer of Skrill USA Inc.) shall be waived by Skrill Holdings Limited. If Skrill USA Inc. is sold to a third party, the Paysafe Group intends to commence applying for its own money transmitter licences in the US in order to enable it to process payments in the US. The Paysafe Group has already obtained money transmitter licences in New Jersey, Delaware, Iowa, North Dakota and Idaho.

55 Skrill

Skrill Digital Wallet 5.19 As at 31 December 2014, the Skrill Digital Wallet had over 44.3 million registered customer accounts, and over 170,000 registered merchants, with 4.6 million customer accounts and 40,600 merchant accounts actively making and receiving payments during FY2014. As at 31 December 2014, 61 per cent. of the Skrill Digital Wallet active customers by number were located in Europe, 27 per cent. in the Americas and 12 per cent. in the rest of the world. As at 31 December 2014, 4 per cent. of Skrill’s merchants were primarily in online gambling, 35 per cent. were in the digital media business (which includes online services and social games) and 60 per cent. were in the e-commerce business (which includes shop systems, retail goods and services and professional sellers on, for example, auction platforms). Approximately e9 billion in transactions across the Skrill Digital Wallet and payment processing platform were processed in the twelve month period ended 31 December 2014.

5.20 The Skrill Digital Wallet is an internet-based account established by merchants and customers and maintained by the Paysafe Group, enabling account holders to send and receive funds instantly, conveniently and securely using a wide selection of payment options at a low cost and to pay for goods and services online without divulging personal ﬁnancial data to merchants. The Paysafe Group also offers the Skrill Prepaid MasterCardâ, which can be used to withdraw cash at 2.1 million ATMs worldwide and to pay for goods and services at over 36 million online and sales outlets worldwide. The Skrill Prepaid MasterCardâ is linked to a customer’s e-Wallet balance and is issued by Wirecard Solutions Limited. When using the e-Wallet, customers may be charged a fee (depending on the method used to upload funds) when uploading funds into their e-Wallet accounts. Additional charges apply when customers transfer funds out of their e-Wallets. Customers are also charged foreign exchange fees and an additional service fee when funds are transferred in a currency other than the source currency of the e-Wallet.

5.21 The Skrill Digital Wallet also allows customers to receive money from merchants, such as winnings from an internet-based gambling website or payments from an auction website. The Skrill Digital Wallet platform is well-suited to micropayments and customer feedback indicates that customers are attracted by the convenience and security of the e-Wallet as they are required to provide personal ﬁnancial data to the Paysafe Group only, rather than to each online merchant separately, and are able to send and receive money transfers cost- effectively.

5.22 Merchants are charged a ﬁxed percentage fee when accepting payments made using the e- Wallet. The fee is agreed in advance with each merchant and depends on the merchant’s transaction volume, its industry and whether or not the merchant is eligible for and opts for the no chargeback policy as it applies to the Skrill Digital Wallet. Merchants are also charged foreign exchange fees and an additional service fee when funds are transferred in a currency other than the source currency of the e-Wallet.

5.23 By establishing a direct link between the merchant and customer through their respective e- Wallets, the Paysafe Group is able to signiﬁcantly simplify the complexity of the traditional payments infrastructure as characterised by card-based payments. Once a deposit is made into the Skrill Digital Wallet system, all transfers between customers or customers and merchants (as the case may be) take place instantly as internal transactions with no money actually moving between bank accounts or payments systems. The transaction therefore involves only the customer’s and the merchant’s e-Wallet accounts, which is in contrast to the traditional card payments system which requires an issuer, an acquiring bank and a payment service provider in addition to the accounts of the merchant and customer.

5.24 In addition to the security and ease of use of the Skrill Digital Wallet, it is accepted by a large number of merchants, which further increases the usefulness and attractiveness of the Skrill Digital Wallet as a means of paying for transactions online. A large number of commercial relationships with banks and card payment processing companies underpin the Paysafe Group’s business offering which would be difﬁcult to replicate quickly or easily.

56 paysafecard 5.25 paysafecard is an e-voucher (‘‘paysafecard’’) and an online payment account (‘‘my paysafecard’’) issued and operated through a UK e-money licence and local licenses or approvals outside the EEA. paysafecard is available as a PIN code printed on a physical card or as an e-voucher which can be purchased from, as at the Latest Practicable Date, approximately 500,000 points of sales and one online shop and can be used to purchase goods and services at approximately 3,600 websites. Customers can then make payments to, as at the Latest Practicable Date, one of the approximately 1,500 online merchants that accept paysafecard by entering their PIN code and through an additional over 1,200 merchants that are connected through a PSP. paysafecard processed approximately e1.7 billion in transactions in FY2014. Sale and distribution of paysafecard is carried out in 40 countries through a network of third party distributors and through paysafecard’s online shop. ‘‘my paysafecard’’ is an online payment account which allows customers to upload funds, using the paysafecard e-voucher, and make online purchases. ‘‘my paysafecard’’ is offered in 28 countries and, as at the Latest Practicable Date, there were over 1.2 million registered ‘‘my paysafecard’’ accounts. In addition, paysafecard offers a Prepaid Mastercardâ under the license of MasterCard International Incorporated. The Paysafe Group adopts a risk based approach when deciding whether to offer paysafecard or ‘‘my paysafecard’’ within a particular jurisdiction and such decisions are made by the paysafecard management team on a country-by-country basis. 5.26 The large distribution network of approximately 500,000 points of sales at which customers can use cash to obtain e-vouchers or prepaid cards that can be used for online transactions, gives paysafecard access to a broad range of customers. paysafecard appeals to customers who are reluctant to use their credit and debit cards online, those who prefer anonymity and to parents who wish to restrict the amount that their children are able to spend online. 5.27 paysafecard derives its revenues from fees charged to merchants accepting payments made using the paysafecard product. A portion of the fees paid by merchants is used by paysafecard to pay commissions to sales outlets that stock and sell paysafecard e-vouchers, with the balance being retained by paysafecard. Due to the commission costs, paysafecard has a naturally lower margin than other Skrill products. 5.28 ‘‘my paysafecard’’ conducts standard KYC checks on its customers when new accounts are opened in order to verify the identity of its customers and operates a policy of applying simplified due diligence for certain jurisdictions. Additional due diligence and verification is carried out when high risk or suspicious activity is detected. In Germany, the online verification is provided by Deutsche Post AG, which offers the PostIdent online verification solution or by Cybits Holdings AG, which offers verify-U, an electronic ID verification platform. The partnership with Cybits allows the Paysafe Group to provide customised solutions within the German market. In the other jurisdictions in which ‘‘my paysafecard’’ is offered, users are required to provide a copy of their passport and a utility bill for KYC purposes. Where ‘‘my paysafecard’’ does not have a third party solution for the purposes of conducting KYC checks, the verification process is outsourced to a service centre in Bulgaria, with paysafecard supervising the verification process.

Ukash 5.29 On 31 March 2015, the Skrill Group completed the acquisition of Ukash, an online e-money payment provider. Ukash provides a similar product offering to paysafecard, such as secure Ukash pin codes and prepaid cards, and its largest market was the UK. 5.30 The Ukash business has now been fully integrated within the paysafecard business and the Paysafe Group ceased distribution of new Ukash codes and prepaid cards on 31 August 2015. The Directors intend to cease redemption of existing Ukash vouchers on 31 October 2015.

Card services 5.31 The Paysafe Group also operates a card issuing business, issuing customers with pre-paid cards, virtual cards or private label cards on behalf of merchants. Paysafe is authorised by the FCA to issue e-money and payment instruments, and is a Principal Member of MasterCard International Inc. for issuing. Through its card issuing division, the Paysafe Group is able to support a variety of different programmes and provide merchants with a

57 range of card programmes, from a white label card programme to fully customised, multi- channel solutions. The Paysafe Group also assists with the set-up and management of merchants’ card programmes, using various approved programme management suppliers. Further, as an issuing bank, the Paysafe Group is in a position to provide bank identiﬁcation number (‘‘BIN’’) sponsorship to organisations that are not ﬁnancial institutions but wish to offer prepaid card programmes. As at the Latest Practicable Date, the Paysafe Group had over 670,000 Net+â physical cards in issue and over 1,080,000Net+â virtual cards in issue.

STP business NETBANXâ 5.32 The Paysafe Group acts as a payment service provider, using its NETBANXâ brand and provides money transmission services to a number of European and Australasian based merchants that have customers in Asia (the ‘‘Asia Gateway service’’). NETBANXâ provides a payment gateway for transactions where the customer is ‘‘not present’’, that is not physically present. This payment gateway allows customers to pay for goods and services on merchant websites or by mail order and/or telephone order, using various payment methods, including credit and debit cards, direct-from-bank and alternative and local payments. As a payment service provider, the Paysafe Group provides merchants with a ‘‘turn-key’’ solution whereby it manages all connections to the card processing networks, the acquiring banks in multiple territories, and the merchant’s online shopping basket software using one integration platform. The Paysafe Group provides its NETBANXâ and Asia Gateway service to merchants only. 5.33 NETBANXâ offers three services: Direct service NETBANXâ acts as a payment gateway for merchants who already have an internet merchant account with an acquiring bank. The NETBANXâ service effectively acts as an interface between the Paysafe Group’s merchants and customers and the Paysafe Group’s merchants and acquirers. NETBANXâ receives a fee for each transaction processed, typically for a fixed amount or, in the alternative, a percentage of the transaction value. Due to the nature of the service, NETBANXâ does not bear the risk of merchant failure. Bureau service NETBANXâ provides the acquiring bank relationship for the merchant and therefore takes on the risk of merchant failure. By assuming a higher level of risk in relation to such transactions, NETBANXâ is usually able to charge additional fees for the provision of its services. Merchants generally pay NETBANXâ a fixed transaction fee, a percentage of the transaction value and a monthly account fee. In addition, NETBANXâ levies chargeback fees if customers make chargebacks due to incorrect billing or the merchant fails to deliver its products or services. As at the Latest Practicable Date, NETBANXâ had ongoing relationships with 18 acquiring banks located in multiple jurisdictions to provide the bureau service. Paysafe’s ongoing relationships with a large number of acquiring banks allows the Paysafe Group to satisfy merchant demand for its services. Further, Paysafe is in a position to satisfy the compliance requirements of the card schemes of the acquiring banks by carrying out suitable Know Your Customer identity verification checks on merchants before granting merchants access to the Bureau NETBANXâ business. Asia Gateway service The Asia Gateway service is provided by NETBANX to a number of European and Australasian based merchants that have customers in Asia and comprises the outsourcing of the provision of a gateway supporting real-time domestic electronic payments in local currency as well as money transmission services comprising the settlement of funds to merchant bank accounts in their preferred currencies. The outsourced gateway services are provided by a third party provider operating in Asia who has its own proprietary technology and a network of local payment processors. The Asia Gateway service is facilitated by a third party outsourced service provider operating in Asia who has its own proprietary technology and a network of local payment processors and money changers. Using the Asia Gateway service, customers are able to initiate deposit transactions on the websites of merchants and are directed to a payment platform to select their issuing bank from a list of local banks. Customers are then directed

58 to the e-payment website of their selected bank and the transaction is completed as soon as the customers have entered their account credentials. Upon completion of the transaction, the funds from the customers’ issuing banks are processed by the local payment processors and money changers and the money changers ensure the funds are remitted directly to Paysafe’s bank accounts in Sweden, the Isle of Man or Malta in the merchant’s preferred currencies. Paysafe uses these funds to credit the accounts of the relevant merchants. 5.34 As at the Latest Practicable Date, the Paysafe Group’s NETBANXâ business had over 53,600 active merchants covering a variety of end markets including retail, digital download, travel, fantasy sports, subscription, online dating, the ‘‘not for proﬁt’’ market and online gambling. In October 2012, Paysafe entered into an agreement with Caesars Interactive Entertainment, Inc. (‘‘CIE’’) (a subsidiary of Caesars Entertainment Corporation); pursuant to which it has agreed to provide gateway payment processing as well as fraud management and related services for CIE. This was Paysafe’s ﬁrst contract to supply payment processing services to the regulated US online gambling market. Paysafe has also entered into agreements with 888 Holdings Inc., Marina District Development Company, LLC d/b/a Borgata Hotel Casino & Spa, Bally Technologies Inc. and Pala Interactive, LLC for its NETBANXâ or NETELLERâ payment solutions. Paysafe currently provides payment services in all three states which have regulated online gambling; New Jersey, Nevada and Delaware, and also provides payment services to a state lottery. Other than the Asia Gateway service, the majority of Paysafe’s merchants in the STP business are non-gambling merchants transacting online although Paysafe’s largest STP merchant is an online gambling merchant. During H1 2015, the Paysafe Group processed more than 53.5 million transactions worth more than US$7.5 billion using its straight-through processing offering (the Paysafe Group considers a transaction for these purposes to be a ‘settlement’, meaning the merchant receiving money from the acquiring bank). 5.35 The Paysafe Group’s aim is to enable the NETBANXâ brand to expand to accommodate an increasing range of payment types. The Paysafe Group recently obtained Principal Membership from MasterCard Europe and Visa Europe to offer merchant acquiring services to merchants in the European Union. This will have an effect on the NETBANXâ bureau business, as Paysafe was previously required to work with an acquiring bank in order to engage in an acquiring relationship with a merchant. However, with the Principal Membership of Visa and MasterCard, Paysafe is able to act as the acquiring bank itself and therefore the Directors believe that it will be able to retain a larger percentage of the processing fee for European transactions than it currently does. The Paysafe Group only started operating as an acquirer in the third quarter of 2014 and the Directors believe that the impact on the NETBANXâ business is not likely to be material until FY2016.

Skrill 1-Tap 5.36 Skrill 1-Tap provides access to the Skrill Digital Wallet bringing quick and easy mobile payments to merchants and customers. By integrating Skrill 1-Tap onto the merchant’s website, merchants can offer customers the opportunity to pay for goods via ‘one tap’, rather than having to re-enter login details or credit card information for reauthorisation every time. First time customers need to activate their account for future use, after which they can make payments with only one-tap on their devices. The funds are then processed instantly through the merchant’s account. Skrill 1-Tap can be used on computers and laptops as well as mobile devices such as smartphones and tablets. 5.37 Skrill 1-Tap is attractive to the online gambling and the gaming sectors as once Skrill 1-Tap is integrated onto a merchant’s website, customers can make payments without being required to exit an application, thereby offering simplicity and convenience and maximising the online gambling or gaming experience for customers.

Skrill Quick Checkout 5.38 In July 2014, a new version of the Skrill direct payment gateway service known as the Skrill ‘‘Quick Checkout’’ was launched and is aimed at customers that do not have Skrill Digital Wallets. The Skrill Quick Checkout became fully functional at the end of October 2014 and Skrill had migrated the majority of its European merchant volume to Skrill Quick Checkout by the end of December 2014. Skrill’s Quick Checkout speeds up the payment process by enabling customers who are making their ﬁrst transaction using Skrill’s services to make a

59 payment without having to register for a Skrill Digital Wallet. The Skrill Quick Checkout also accepts card payments as well as the majority of Skrill alternative payment options, such as prepaid cards and vouchers. 5.39 In order to use the Skrill Quick Checkout, merchants are required to integrate an HTML based payment gateway to their e-commerce check-out pages. For customers in Europe and USA, the Skrill Quick Checkout acts as a normal payment gateway, however non-European and non-US customers are required to use a process which incorporates digital wallet functionality when accepting a payment using the Skrill Quick Checkout.

Direct Payment Gateway 5.40 The Direct Payment Gateway, which was launched in 2009, is based on the Skrill Digital Wallet platform and also allows the direct processing by the merchant of payment card transactions and payments from any of a 100-plus local payment options, as well as payments from Skrill Digital Wallet accounts. The Direct Payment Gateway is primarily used by merchants offering online gambling services. 5.41 To make a payment to a merchant that has integrated the Direct Payment Gateway into its website, a customer selects an item for purchase on the merchant’s website and is then redirected to the Direct Payment Gateway at the checkout. At this point existing customers are prompted to enter their email address, password or payment details and conﬁrm the payment. New customers enter their details and conﬁrm their payment in one step. As a result, the Paysafe Group establishes a direct relationship with the customer by requiring them to accept terms and conditions and as a result registering them for an e-Wallet when they make the payment on the merchant’s website. The Paysafe Group debits money from the customer’s existing e-Wallet balance, or the customer funds the e-Wallet in real-time by credit card, debit card or bank transfer funding and, for certain payment options (excluding bank transfer funding), instantly credits it to the merchant’s e-Wallet account.

Skrill Direct 5.42 The Paysafe Group offers a 24/7 instant and low cost online bank transfer service, Skrill Direct, currently available in the UK, Germany, Austria, Italy, France, Spain and Hungary. With Skrill Direct, customers are able to use another funding and payment option linking their online bank accounts with their e-Wallets. Customers can securely transfer funds from their bank accounts into their e-Wallets or into merchant accounts in order to pay for goods and services. Merchants beneﬁt from a lower risk transaction, given customers need to authorise payments using their existing online banking login details. Both parties receive immediate conﬁrmation of payment.

P2P Remittance 5.43 The Paysafe Group’s P2P solution allows customers to send money domestically and internationally, using the same currency or multiple currencies, through Skrill’s e-Wallet platform. Customers can load their digital wallets using their preferred local payment methods and execute payments based on Skrill’s local banking deposit and withdrawal functionality. The P2P send money fee is 1 per cent. of total funds transferred, capped at e10 per transfer plus a ﬂat rate foreign exchange fee which is dependent on the currencies involved in the transfers. For VIP Customers, the fee is capped at e1.

Foreign Exchange Services 5.44 The Paysafe Group provides foreign exchange services to its merchants and customers whenever funds move from one e-Wallet to another e-Wallet denominated in a different currency. Currently, multi-currency operations between 41 currencies can be executed throughout the platform. Multi-currency transactions, for example could involve a customer in the UK with a Sterling e-Wallet transacting with a merchant in France with a Euro e-Wallet, or a business in the US with a US Dollar e-Wallet remitting funds to a contractor in Poland with a Zloty e-Wallet. 5.45 The Paysafe Group charges a FX fee of up to 5.49 per cent. (based on Reuters mid-market rates) of the transaction volume. The FX fees will vary depending on the currency involved, for example, US dollars, pounds sterling and Euro will attract lower fees than Polish Zloty. In traditional transactions, a business would need to buy currency every time a multi-currency transaction is generated. However, because customers upload funds in multiple currencies,

60 the receiving currency will typically be available for withdrawal by the receiver – in the example above, Polish customers will be uploading Zloty to the e-Wallet, which can then be used to fulﬁl the withdrawal request of the contractor receiving funds from the US business. Therefore, the Paysafe Group only buys and sells currency on an aggregate basis, depending on long or short positions, rather than for every transaction on the e-Wallet system and as such, to the extent that transactions can be funded without the Paysafe Group needing to buy or sell foreign currency, the Paysafe Group earns a funding cost-free margin.

Payment Service Provider Service (‘‘PSP’’) 5.46 The Paysafe Group offers a PSP product targeted at large and medium-sized merchants. The PSP product enables merchants to process card transactions directly without requiring the merchant or customer to have an e-Wallet. Unlike the Direct Payment Gateway, the PSP product does not result in the customer registering for an e-Wallet and does not require the customer to accept the Paysafe Group’s terms and conditions as the transaction is undertaken with the acquiring bank. The PSP product broadens the Paysafe Group’s target market beyond that already covered by its e-Wallet and Direct Payment Gateway.

Payolution (Invoice and Instalments) 5.47 Payolution arranges the provision of point-of-sale financing to customers of e-commerce merchants in order to ensure that the merchants are put in funds within an agreed timeframe (which is within 29 days after merchants are provided with a statement of its transactions) and is offered as a white-label solution. Payolution provides merchants with the ability to extend credit to customers to pay later via invoice once the goods have been received, enabling merchants to offer their customers an alternative payment solution to credit cards or other payment methods. Merchants benefit from Payolution’s technology, which can be integrated with the various local credit scoring agencies while also offering merchants a highly automated claims management and reconciliation system. 5.48 Payolution is based in Austria and the provider of finance is a privately owned German bank. Payolution enters into a tripartite agreement with the customer and the provider of finance, pursuant to which the customer commits to making repayments. The service can be enabled as a one-off payment or as a payment in instalments over time for higher value goods. The merchant assumes no credit risk, in the event that an instalment is not paid by the customer, as the merchant receives funds at the point of sale from the provider of finance. Payolution undertakes to reimburse the provider of finance in the event that a customer fails to meet its payment obligations. Payolution derives its revenue by charging fees to merchants that accept the service.

6. PAYMENT PLATFORMS 6.1 The Paysafe Group’s NETELLERâ and NETBANXâ services are delivered using the secure Paysafe Payment Platform (the ‘‘Payment Platform’’). The Payment Platform is designed to facilitate all payment processing activities across multiple sales channels including e- commerce, ‘‘cardholder not present’’, and mobile, and is securely stored and easily accessible. The Payment Platform is designed to enable the growth of the businesses of merchants and developers in new markets and channels, with the Paysafe Group assuming responsibility for facilitating the processing of payments in order to help facilitate scale, security, performance, and innovation. 6.2 Paysafe’s Payment Platform infrastructure operates within a number of interconnected international data centres, providing secure and resilient services (relating to storage, computing, networking, security and management); which allow Paysafe’s payment processing services to be provided to merchants and customers by way of virtual technology. Each of the Stored Value and STP business lines are supported by separate Payment Platform infrastructures, each comprising different capabilities. Both of these platforms have been developed by the Paysafe Group in-house and are based on proprietary intellectual property. Platform capabilities are made available to merchants and service providers via modern interfaces and software development kits, enabling rapid, multi- channel integration. The technology platforms supporting the product suites run on a clustered, scalable architecture underpinned by enterprise grade technology from providers such as Oracle and Microsoft, amongst others.

61 6.3 Paysafe’s Skrill branded services are delivered using the Skrill payments platform (the ‘‘Skrill Platform’’). As at the Latest Practicable Date, the Skrill Platform processed internet payments through a network of over 80 banks and payment providers, offering over 100 local payment options in more than 200 countries and territories, across 40 currencies and 16 languages. The Skrill Platform enable merchants to accept a variety of local payment methods, including credit card and bank-based payments, direct debits, bank transfers and other online bank transfers, from one platform. The Skrill Platform is integrated with the merchants’ websites with the Paysafe Group managing the technical connections, relationships with external networks and bank account connections necessary for payments to be made and received. 6.4 The Directors intend to merge and modernise the Payment Platform and the Skrill Platform infrastructure in order to migrate towards a single consolidated payment platform which is capable of supporting most of the Paysafe Group’s business lines. The consolidation of Paysafe’s Payment Platform infrastructure will reduce the number of data centres and underpinning technologies required by the Paysafe Group. 6.5 Paysafe’s Payment Platform offering is annually assessed and certified to the Payment Card Industry Data Security Standards (‘‘PCI DSS’’). The PCI DSS is a worldwide standard which was set up in order to help businesses process card payments securely, reduce card fraud and protect sensitive cardholder data. In contrast to many of its merchants, Paysafe is in a position to ensure continued investment in the Payment Platform in order to ensure that the data of the Paysafe Group’s merchants and customers remains secure in the face of existing and emerging threats. The Paysafe Group’s Skrill Platform is also certified to the PCI DSS, and where the Paysafe Group uses a third party payment processing platform to deliver certain Skrill services, the Paysafe Group reviews whether the relevant third party is also certified to the PCI DSS. 6.6 The Paysafe Group’s business model requires close commercial relationships with banks and payment processing companies, as all funds that are uploaded or withdrawn by customers or merchants are cleared through these institutions. The Paysafe Group maintains commercial relationships with financial institutions such as retail banks, payment processors and PSPs, treasury service providers, technical service providers and twelve major credit card acquirers and issuing banks within Europe. These relationships cannot be immediately replicated, having been carefully developed over a number of years and maintained by a relationship team, which is also tasked with broadening the portfolio of banks and payment providers with which the Paysafe Group transacts.

7. RISK MANAGEMENT 7.1 The Paysafe Group’s Risk Management Committee is responsible for assessing and managing risk for the Paysafe Group. The Risk Management Committee presents the minutes of its meetings along with its findings and risk analyses to the Audit Committee and the Audit Committee periodically reviews the minutes of the meetings of the Risk Management Committee. The Audit Committee has appointed Raymond Chabot Grant Thornton (‘‘RCGT’’) as internal auditor of the Group. An internal audit plan has been agreed with RCGT for FY2015 to FY2018 and their audits commenced in the first quarter of 2015. RCGT has performed quarterly audits on high risk areas as set out in the internal audit plan at a consolidated level as well as quarterly audits for the UK and Isle of Man regulated companies. The results of the internal audits are presented to the Audit Committee at its quarterly meetings. The Audit Committee reviews each internal audit report, recommendations and associated management action plans to ensure that the key areas targeted for improvement by the internal audits are appropriately addressed in an expeditious manner. 7.2 Paysafe conducted a risk assessment of the Paysafe Group in 2014 and developed an enterprise risk management framework for the Paysafe Group. During the risk assessment, 16 key risks were identified and the likelihood of these risks occurring were assessed. Additional risk assessments were also performed in 2014 for the UK and Isle of Man regulated companies in the Paysafe Group. During those risk assessments, 12 and 11 key risks were identified for the UK and Isle of Man regulated companies respectively and the likelihood of these risks occurring were assessed. Using the risk management framework,

62 the Paysafe Group has a strategy in place to monitor identified risks and to develop risk mitigation strategies at the consolidated level as well as specifically for the UK and Isle of Man regulated companies. 7.3 Prior to the Skrill Acquisition, the Skrill Group engaged KPMG to conduct an enterprise risk assessment which identified 23 key risks applicable to the entities within Skrill Group and the likelihood of these risks occurring were assessed. In the third quarter of 2015, the Paysafe Group updated its risk register and audit universe to capture new and emerging risks to create a consolidated and updated risk universe and a new consolidated internal audit plan for the Paysafe Group following completion of the Skrill Acquisition. The risk assessment conducted by KPMG in relation to the Skrill Group (prior to Completion) forms part of the Paysafe Group’s updated risk universe and consolidated internal audit plan. 7.4 The Paysafe Group’s platforms provide extensive real-time risk monitoring and decision- making, using a mix of proprietary rules-based engine technology and third party services. Paysafe’s risk management team is responsible for monitoring and adjusting risk rules and thresholds and for managing events. The risk platforms are autonomous and highly automated through proprietary IP overlaid on enterprise management frameworks. Each of the STP and stored value business divisions leverage proprietary risk management and anti- fraud technologies, customised separately around transaction specifics, volumes and the nature of processes experienced on each divisional platform. 7.5 Merchants and customers also benefit from the Paysafe Group’s risk and anti-fraud management features, including real-time monitoring of online transactions to mitigate and reduce fraud for merchants, which enables the Paysafe Group to offer some of its qualifying merchants a no chargeback policy. When determining whether to offer no-chargeback protection to merchants, the Paysafe Group conducts a risk based analysis focused on the transactions carried out by each merchant. This is attractive for a large range of merchants who conduct their business over the internet and who may not have the capability or resources to develop their own sophisticated payment and fraud management systems.

Straight Through Processing 7.6 The Paysafe Group’s STP division provides processing services through the multi award- winning NETBANX gateway, the most recent award being granted in May 2015 when the Paysafe Group was named best payment service provider for the NETBANX gateway by CardNotPresent.com and the Payment XP gateway which is used by Meritus. 7.7 The NETBANX gateway was constructed with risk management in mind and is a full feature platform enabling both merchants and internal users to manage and mitigate risks on a granular, real-time basis. The overall risk approach is to provide merchants with the necessary tools to prevent fraud and to work with these merchants to create and customise rules and systems, based on the Paysafe Group’s technology, which enhance their risk management capabilities. The Payment XP gateway was also designed to effectively manage risks but it has fewer fraud management tools than the NETBANX gateway and the Paysafe Group plans to commence migration of the Meritus merchants using the Payment XP gateway to the NETBANX gateway during 2016. 7.8 The Paysafe Group’s fraud management solutions available on the NETBANX and Payment XP gateways comprise proprietary risk rules engines which have customised rules based on a merchant’s business model, industry and/or location and which are designed to minimise fraud on all payment types. The risk rules engines allow for near real-time decisions, leading to a fast response to fraudulent transactions. 7.9 For merchants using the NETBANX gateway, the Paysafe Group provides chargeback and dispute management services to its merchants, through partnerships with Verifi and Ethoca and, through the use of various third party vendors. For certain higher risk merchants using the Payment XP gateway, the Group mandates the use of Verifi to help with chargeback management and Ethoca to help identify fraudulent transactions. 7.10 For merchants using the NETBANX gateway, the Paysafe Group also offers its merchants additional services such as device fingerprinting in order to allow merchants to examine the identity of its users and their activities and configures appropriate business rules to identify likely fraudulent activity, IP Geo Location tools to validate the geographic location of visitors to merchants’ websites and identity and age verification services which assist with the

63 validation of the identity of the merchants’ customers by comparing customers account details against a variety of data sources and/or by asking prospective multiple-choice questions as part of the verification process and 3-D Secure, a technical standard developed by Visa and MasterCard designed to combat online credit card fraud. With 3-D Secure, cardholders who have registered for Verify by Visa or MasterCard SecureCode are required to use passwords to validate their identity whenever they make a purchase on a participating site. 7.11 Also key to the NETBANX gateway is the ability to filter transactions on any data element provided by the merchant, customer, or other participant in the transaction, such as the issuer or acquirer. The platform allows merchants to easily filter out transactions that do not meet specified criteria, or allow the merchants to suspend and out sort transactions which appear to be fraudulent. Rules can be created allowing merchants or internal staff to monitor the velocity of transactions on multiple data points and take actions when thresholds are exceeded. Back office accounting systems allow the Paysafe Group to suspend individual transactions without holding entire batches, limiting the inconvenience to merchants, should an investigation need to be carried out. 7.12 The Paysafe Group’s merchant risk-monitoring platform leverages all transaction elements from the NETBANX and Payment XP gateways and allows staff to quickly and efficiently identify merchants whose transactions or other activity raise questions or suspicion of fraud. Daily exception and monitoring reports are reviewed by staff and acted on before any funding is settled to merchants. 7.13 NETBANX operates its bureau business by using a variety of risk management tools. The Paysafe Group vets merchants before approval to use the bureau business is granted and the transaction fees levied for processing payments using its bureau business are reflective of the higher level of risk being undertaken by the Paysafe Group. Upon accepting a new merchant, the NETBANX system actively monitors trading patterns in order to prevent and detect fraudulent transactions and activity. This risk based approach allows the Paysafe Group to offer its services to customers that may otherwise be rejected by banks as a result of being deemed to be high risk. In this context, ‘‘high risk’’ customers would include companies operating in industries perceived to be high risk, such as online dating, travel services or subscription-based services. Furthermore, this service offers the Paysafe Group an internal risk-based system that assesses and monitors the individual risk profiles of merchants to maintain risk exposure at an acceptable level. The Paysafe Group’s continued compliance with the PCI DSS also allows merchants to manage their own PCI DSS compliance obligations.

Stored Value 7.14 Within the stored value division, NETELLER, Skrill and paysafecard all use an Enterprise Risk and Transaction Monitoring System (‘‘ERTMS’’) to mitigate the risk of fraud. The ERTMS platforms provide real-time monitoring and decisions related to NETELLER, Skrill and paysafecard member and merchant activity. 7.15 The ERTMS platforms are fraud mitigation engines that are built upon industry leading platforms supplied by third party providers, who are suppliers of ﬁnancial crime, risk, and compliance solutions. The platforms are enterprise grade, fault tolerant and the NETELLER ERTMS has been implemented with active/passive failover redundancy. The NETELLER platform also provides a case management system and a suite of reporting tools. All the ERTMS platforms provide a rules based transaction monitoring engine which allows for the effective implementation of anti-money laundering, KYC, and risk-based rules which are then triggered and partitioned at the appropriate time based on member and merchant activity. 7.16 The NETELLER, Skrill and paysafecard ERTMS platforms enable real-time fraud and anti- money laundering rules to be created based on events such as new account signups, logins, transactions, or a combination thereof, and can be based on a plethora of attributes, including customer account country, BIN country (where credit cards are used as a funding instrument), IP country, transaction value, transaction frequency, device ID and deposit or withdrawal type. Rules can be set to trigger alerts on transactions, decline a transaction, close an account, challenge a member with a personal veriﬁcation question, or delay a transaction. The rules can also be adapted based on historical fraud data and also they

64 continue to evolve based on current transaction data. When the rules are triggered in the ERTMS the relevant transaction may be declined and/or the customer’s account may be frozen.

7.17 Neural modelling and member profiling are utilised by the NETELLER ERTMS to create adaptive rules based on historical fraud data. Personal Verification Questions rules can be configured to prompt customers with a personal verification question in real-time upon account sign-in or when a transaction is being initiated in order to validate their identity and prevent fraudulent activities.

7.18 In order to significantly enhance fraud mitigation, the Paysafe Group has also fully integrated a real-time device profiling capability into the NETELLER, Skrill and paysafecard ERTMS platforms. This enables the Paysafe Group to perform, in real-time, a series of security checks to validate the reputation of the device being used by the customer. These checks include reviewing the IP address against a database of high risk IP addresses and known proxies, as well as establishing a unique fingerprint of the device. The device fingerprint is generated using more than 200 unique device parameters which are used to determine a fraud risk score. Rules can then be written to either alert or take action based on the risk score or based on any one or combination of the device’s attributes. The device profiling capability can also be used to detect a customer’s new account signups and logins, even where the customer is browsing the internet anonymously.

7.19 The NETELLER, Skrill and paysafecard ERTMS fraud engines also use IP Geo Location tools to validate the geographic location of devices being used to execute an event or transaction. IP Geo Location information is gathered and factored into the ERTMS fraud related rules. The NETELLER ERTMS system also provides case management functionality that enables risk agents to create unique cases for each account or event. Within the NETELLER ERTMS case management system, case content cannot be changed and viewing is secured on a need to know least permissions basis. Cases are assigned to agents as needed and investigated until resolved which allows the Paysafe Group to manage the NETELLER queues and prioritise high risk events to the appropriate skillsets.

Information Security 7.20 The Paysafe Group’s global information security policy follows industry best practices in layered security across all computing environments and is assessed by multiple external security providers. The Paysafe Group is a participating member of the Payment Cards Industry (‘‘PCI’’) Standards Council, and provides thought leadership in the payments security space with an advisory seat on the tokenization working group, an external working group which aims to ﬁnd tokenization solutions for companies. Tokenization is the process by which credit and debit card numbers are shortened and replaced with a randomly generated series of numbers and letters called ‘‘tokens’’ which cannot be used to make fraudulent transactions. The use of such tokens serve to enhance the security of cardholder data storage and properly implemented tokenization solutions may remove or reduce the requirement for a merchant to retain a customer’s full card details after an initial transaction has been processed. All platforms are conformant with, and annually assessed and certiﬁed to, the PCI DSS. Skrill Limited also holds PCI accreditation and uses tokenization solutions in order to protect the data of its customers. The Paysafe Group has a global data centre presence, connected via an MPLS network and operating production facilities in Montreal, Canada; Douglas, Isle of Man; Dublin, Ireland; Vienna, Austria and Frankfurt, Germany.

Legal Risk 7.21 Paysafe’s Risk Management Committee identifies and evaluates legal risk as part of its responsibility for assessing and managing risk for the Paysafe Group. The key legal risks identified as being critical to the business of the Paysafe Group are changing regulatory and authorisation requirements and the legal and regulatory environment as it applies to the supply of online gambling services. Please see Part II (Online Gambling Regulation) of this document for a description of the specific risks relating to the operations of the Paysafe Group within the online gambling industry.

65 Business continuity 7.22 The Paysafe Group has an ongoing Business Continuity Programme covering each of its offices and departments. The Business Continuity Programme is focused on the people, processes, offices and supporting ICT corporate systems with the primary objective to maintain plans and supporting procedures to enable business operations to continue in the event of an incident or disaster. The Business Continuity Programme is coordinated with the IT leadership who manage the disaster recovery activities which are primarily targeted on the production transaction processing systems. The Paysafe Group’s Business Continuity Programme has a dedicated subject matter expert who leads and coordinates with department and office Business Continuity Programme representatives. The Business Continuity Programme scope has been extended to encompass the new acquired Skrill business. The Directors expect the Paysafe Group’s Business Continuity Programme to be in place by 31 December 2015.

Disaster recovery 7.23 In the event of a major failure of the Paysafe Group’s NETELLERâ systems, in accordance with its disaster recovery plan, the Paysafe Group’s stored value service would be limited to confirming the balances of its customers and returning funds to such customers using a manual process which the Directors expected could take up to one week to complete, depending on the location of the customers. The Paysafe Group has purchased IT infrastructure in order to further enhance its stored value disaster recovery plan. In respect of its stored value services, the Paysafe Group has entered into an agreement with a data centre service provider in Ireland to deliver a Warm-Standby centre in Dublin, being a back- up system which is data mirrored in near real-time, in respect of its stored value systems that are currently operating using the Paysafe Group’s servers in the Isle of Man. All infrastructure and data replication processes for this additional data centre were put in place at the end of June 2015, at which point the site became capable of fulfilling its disaster recovery role, and in the event of the failure of the main server site, switching to the additional data centre could take several hours. Final testing of the site has been completed and the data centre has been fully operational since the end of October 2015. 7.24 In respect of its NETBANXâ business, the Paysafe Group has augmented its disaster recovery capabilities by establishing an active failover processing centre which will have the ability to reroute internet traffic with minimal disruption to the back-up facility for the majority of the Paysafe Group’s NETBANXâ services in the event of the failure of the Paysafe Group’s straight through processing systems. Traffic between the data centres will be rerouted in less than two minutes if there is a planned outage and in less than fifteen minutes if there is an unplanned event. The processing centre has been fully operational since mid-October 2015. The addition of global load balancing will further enhance the failover capabilities by lowering the time to reroute traffic. Global load balancing is currently being iteratively rolled out, with a target completion of end of January 2016.

7.25 The Paysafe Group’s Hot-Standby data centre in Frankfurt, which serves the Paysafe Group’s Skrill branded products, is operational and the Paysafe Group’s data centre in Vienna is fully operational and serves as the secondary data centre for paysafecard. Traffic between the data centres can be switched almost immediately. The Paysafe Group will consider transferring the secondary data centre for paysafecard to the Paysafe Group’s data centre in Dublin, Ireland during 2017. The worst case scenario of a corruption of data bases affecting both data centres would result in full functionality not being available for a period of approximately two to four hours. Such procedures may not, however, be sufficient to ensure that the Paysafe Group is able to carry on its business in the ordinary course if they fail or are disrupted, such that the Paysafe Group may not be able to anticipate, prevent or mitigate any material adverse effect of any failure on its operations or financial performance.

8. SALES AND MARKETING AND CUSTOMER SERVICE Stored Value 8.1 The Paysafe Group’s core stored value business is pursuing a marketing strategy targeting high end customers transacting high volumes through the Paysafe Group’s stored value platform (‘‘VIP Customers’’). In February 2012, the Paysafe Group launched the

66 NETELLERâ Reward Points Programme (the ‘‘Programme’’), an enhanced loyalty cash-back programme which allows VIP Customers to earn points on their transactions in the NETELLERâ e-Wallet accounts. Members of the Programme can then redeem these points for merchandise, cash exchange, and other NETELLERâ provided services. The Programme has allowed the Paysafe Group to attract and retain VIP Customers and as at the Latest Practicable Date, the Paysafe Group’s NETELLERâ VIP Customer base was over 10,000 and accounted for 8.16 per cent. of the Paysafe Group’s revenue in FY2014. The Paysafe Group also has a customer support team which is dedicated to VIP Customers of the NETELLERâ business and is based in Sofia, Bulgaria. The VIP Customer service team handles queries and communications from VIP Customers through a range of methods including telephone, email and skype at the Paysafe Group’s interactive support centre, with dedicated relationship managers for many VIP Customers. A VIP customer base for Skrill branded products was introduced in 2006 and, as at the Latest Practicable Date, included over 49,000 active VIP Customers. During FY2014, Skrill’s VIP Customer base accounted for 15 per cent. of the Skrill Group’s revenue. 8.2 The Paysafe Group’s business-to-customer marketing strategy includes incentivising customers to make payments to merchants who promote NETELLERâ on their websites, to upload funds into their e-Wallets and to request Net+ pre-paid cards. The business-to- business marketing strategy of the Paysafe Group involves promoting merchants through email campaigns in specific markets, via monthly member and VIP newsletters and through the Paysafe Group’s social media. 8.3 The Paysafe Group’s sales strategy in the gaming and foreign exchange sectors includes integrating new key operators (such as in Italy, Spain and France), and increasing its market shares with existing operators and affiliates by sharing costs for co-branded marketing initiatives and improving placement and exposure on their websites. The sales strategy also includes increasing the number of affiliates themselves, by offering a life time revenue share model and offering affiliates exposure through the Paysafe Group’s user base. STP 8.4 For marketing its STP business, the Paysafe Group uses direct marketing and selling, direct response, online services, online retail and online gaming to attract individual clients. The Paysafe Group also focuses on strategic alliances in order to partner and offer large groups of clients STP payment services, for example with banks, software providers and ecommerce platforms. Skrill 8.5 The Paysafe Group’s Skrill branded products benefit from a seven day a week customer telephone support service for English speaking customers and 11 other languages during UK business hours, along with 24 hour, 365 day online customer support. The Paysafe Group provides a merchant support service and technical support team, which addresses any potential issues for merchants, including helping merchants to integrate Skrill branded products platforms (for Direct Payment Gateway, PSP or paysafecard) with their front end and back office related technology and are provided with training aimed to optimise the use of the Skrill branded products in order to improve merchant conversion. The Paysafe Group also has a dedicated customer service hotline for the reporting of lost or stolen Prepaid MasterCardsâ.

9. INTEGRATION 9.1 Following completion of the Skrill Acquisition, the Paysafe Group has formed an Integration Committee in order to review its product offerings, policies and procedures, with the aims of fully integrating the Skrill business, achieving the Paysafe Group’s targeted cost savings from FY2016 onwards and ensuring the Paysafe Group is well positioned to pursue its strategic aims. 9.2 The Paysafe Group’s integration plan has 16 key workstreams and includes consideration of the Paysafe’s Group’s physical operations and employee headcount. For example, the Paysafe Group intends to consolidate its ofﬁces in Bulgaria, which is where the Paysafe Group’s stored value operations will be primarily based, and has entered into a new lease agreement for premises which are capable of accommodating the increased number of employees in Bulgaria. The Paysafe Group is also continuing with its redundancy

67 programme following the completion of the Skrill Acquisition and 97 employees from Montreal, Cambridge, London, Sweden, Hong Kong, Germany and Bulgaria have left the Paysafe Group since Completion. The Paysafe Group expects that an additional 92 employees will be made redundant during Q4 2015 in connection with the integration of Ukash and paysafecard and as a result of Completion. Another group of approximately 46 employees are likely to be made redundant by the end of Q1 2016 in Calgary, Canada, in order to allow the Paysafe Group to consolidate activities carried out by the Paysafe Group’s payment delivery centre in Sofia, Bulgaria. Furthermore, following completion of the Ukash Acquisition, Ukash has been transferring its activities to paysafecard resulting in 79 people in Ukash London being made redundant between June and December 2015. As from December 2015 it is expected that Ukash will have no employees. 9.3 The Paysafe Group also intends to review its existing back-up data centres and, where appropriate and beneficial to the Paysafe Group, will seek to consolidate these data centres. The aim of the consolidation exercise is to ensure that the Paysafe Group continues to be supported with a fully resilient disaster recovery operation, whilst reducing the number of its back-up data centres. The Directors expect the review and consolidation of the data centres to be completed by December 2018. 9.4 The Directors intend to merge the customer service operations of the Paysafe Group. Currently, the Paysafe Group has retained the separate customer services operations that were in place as at Completion, however the Paysafe Group expects to begin to roll out training and provide the customer service team with the necessary information in order to ultimately allow each of the Paysafe Group’s product lines to be supported by any member of the Paysafe Group’s customer service team. 9.5 The Paysafe Group is also reviewing its IT systems and payment platforms. The Directors intend to migrate the Paysafe Group’s payment processing activities to the legacy Skrill Platform, whilst modernising the newly consolidated platform in order to ensure that the newly modernised and consolidated platform is capable of supporting the majority of the Paysafe Group’s business lines. The Paysafe Group also intends to wind down the Skrill PSP platform and use the Paysafe Group’s NETBANXâ platform to carry out the processing activities that were previously carried out using the Skrill PSP platform. 9.6 The Directors are also reviewing the Paysafe Group’s employee remuneration policy, the operation of the Paysafe Employee Share Plans and the pensions offered by the Paysafe Group. The Directors are considering the introduction of a new employee remuneration policy, which will provide the legacy Skrill Group employees with access to the Paysafe Employee Share Plans. During FY2016, the Paysafe Group intends to consolidate each of the defined contribution pension schemes in the UK, with the intention of ensuring that the relevant Paysafe Group employees are treated equitably during the course of the consolidation exercise.

10. THE PAYSAFE GROUP’S STRATEGY The Paysafe Group intends to pursue the following strategy:

Creation of a leading payments provider across a wide addressable market 10.1 The Directors believe that the completion of the Skrill Acquisition has created a more diversified, vertically integrated payments provider with the capability to facilitate payments across a wide addressable market. The Paysafe Group is a provider of global payment solutions at key points in the funding chain, specifically with respect to pre-funding, immediate funding and future funding transactions. Prepaid funding is made possible via paysafecard and Ukash, allowing customers to pre-fund their digital wallets by purchasing vouchers from retail outlets. This prepaid solution particularly appeals to customers who prefer not to use their credit or debit cards for online transactions. This provides additional ‘‘money-in’’ opportunities for customers. The Paysafe Group’s ability to provide immediate funding solutions is expanded due to the combination of Paysafe and Skrill’s digital wallet and payment processing solutions, the latter of which would benefit from Paysafe’s principal acquirer status, which allows the Paysafe Group to directly acquire merchant accounts without the need for an acquiring bank, and to process Visa and MasterCard payment transactions in the UK and the EU for merchants of the Paysafe Group. The combined stored value division will provide a broader and more international solution to customers,

68 ensuring customers have a range of payment options each of which allow customers to make immediate payments using their digital wallets. Payolution provides the Paysafe Group with a future funding solution by enabling merchants to extend credit to customers to pay later via invoice once the goods have been received. The provision of point-of-sale ﬁnancing to customers of e-commerce merchants would broaden the type of payment transactions the Paysafe Group could target, thereby expanding strategic growth opportunities.

Stored Value 10.2 The Directors expect that the Paysafe Group will become a leading player in the provision of digital wallets to merchants and customers. Exposure to business verticals is broadened and diversiﬁed away from reliance on online gambling to also cover digital media and e- commerce. The Paysafe Group will also seek to maintain focus on the online gambling opportunity, particularly in the North America region.

Payment Processing 10.3 The Directors expect that the Paysafe Group’s complex payment processing networks will provide the Paysafe Group with improved penetration and reach into new and existing markets, in addition to accelerating the on-boarding of new merchants through network effects. The Paysafe Group’s strategy is to monetise the increased scale of the Paysafe Group’s processing offering, leveraging its critical mass and diversiﬁcation to attract new merchants. Furthermore, the Paysafe Group will seek to implement its existing acquiring relationships across as many new and, where possible, existing transactions as possible to drive gross margin expansion.

Expected growth in North American online gambling markets 10.4 Since the 2011 ruling from the US Department of Justice that the Wire Act only applies to online sports gambling, certain US states have sought to introduce regulations for online gambling, with Nevada, Delaware and New Jersey leading in this area and New York, California and Pennsylvania expected to follow suit. The opening of the US regulated online gambling market presents a signiﬁcant opportunity for the Paysafe Group to grow its operations which provide payment processing and risk management solutions to regulated online gambling merchants. The Paysafe Group’s offering brings together a suite of products encompassing operators’ requirements, from compliance to payment processing and fraud management. The end-to-end customer solutions for traditional operators are well positioned to capitalise on potential online markets. The Paysafe Group currently processes online gambling payments in Nevada, New Jersey and Delaware, with Sutton Bank carrying out the regulated money transmitting service on behalf of the Paysafe Group. The Paysafe Group is registered as a vendor by the Division of Gaming Enforcement in New Jersey and the Paysafe Group also provides services to Lotto Quebec and the Ontario Lottery Group in Canada and is registered as a non-gaming related supplier by the Alcohol and Gaming Commission of Ontario. The Paysafe Group currently derives an immaterial proportion of its revenue from the US regulated online gambling industry but it would seek to capture immediate market share in new markets formed from further state-by-state deregulation.

10.5 Prior to Completion, the Skrill Group completed an intra-group restructuring to transfer Skrill USA Inc. outside the Skrill Group to Sentinel Group Holdings S.A. Following Completion, Paysafe commenced the process for obtaining the required approvals in connection with Skrill USA Inc.’s money transmitter licences from the relevant US states or territories in order for the Paysafe Group to be able to acquire Skrill USA Inc. The transfer of Skrill USA Inc. to Sentinel Group Holdings S.A. was carried out at market value and the consideration (which is e5.2 million) was left outstanding as a loan between Skrill Holdings Limited and Sentinel Group Holdings S.A. In addition, Skrill Holding Limited has also provided Skrill USA Inc. with a funding loan for working capital purposes. Assuming that the required approvals are received in a timely fashion, Skrill Holdings Limited will repurchase Skrill USA Inc. on receipt of the relevant approvals and the consideration for that transfer will be the release of Sentinel Group Holdings S.A.’s obligation to repay the e5.2 million loan owed to Skrill Holdings Limited (and therefore Skrill Holdings Limited will not be required to raise any funds to ﬁnance the acquisition).

69 10.6 Sentinel Group Holdings S.A. has agreed that it will not sell Skrill USA Inc. to a third party for a period of six months after Completion. If Skrill Holdings Limited has not obtained the relevant approvals to enable Skrill USA Inc. to be transferred to Skrill Holdings Limited within the six month period following Completion, Sentinel Group Holdings S.A. shall be permitted to sell Skrill USA Inc. to a third party. In the event Skrill USA Inc. is sold to a third party, Sentinel Group Holdings S.A. will use reasonable endeavours to sell Skrill USA Inc. for the best possible purchase price, and the proceeds of that sale shall be used to repay the loans put in place between Skrill Holdings Limited and both Sentinel Group Holdings S.A. and Skrill USA Inc., and any excess loan amount that remains outstanding (whether relating to the working capital loan or the consideration for the transfer of Skrill USA Inc.) shall be waived by Skrill Holdings Limited. If Skrill USA Inc. is sold to a third party, the Paysafe Group intends to commence applying for its own money transmitter licences in the US in order to enable it to process payments in the US. The Paysafe Group has already obtained money transmitter licences in New Jersey, Delaware, Iowa, North Dakota and Idaho.

Seeking opportunities for inorganic growth 10.7 The Directors believe the Paysafe Group is in a position to establish itself as a natural market consolidator. The Directors may seek to identify strategic acquisition and investment targets with a view to further consolidating the digital payments industry by considering the acquisition of payment-related companies and/or complementary technologies, which may expand the geographical reach and customer base of the Paysafe Group and/or increase the technical capabilities or products of the Paysafe Group. In furtherance of this strategy, Paysafe completed the acquisition of FANS, a company which specialises in mobile technology development for venues and arenas and offers consultancy services to artists, promoters and festivals with a view to enhancing fan engagement strategy, on 22 May 2015. In October 2015, the Paysafe Group signed two non-binding letters of intent in respect of two potential acquisition in furtherance of this goal. The first proposed acquisition involves the purchase of a card payment transaction portfolio. The consideration for the proposed acquisition, if it proceeds, is intended to be satisfied in cash. The second proposed acquisition involves the purchase of the business and assets or shares of a prepaid online and mobile payment services provider. The consideration for the proposed acquisition, if it proceeds, is intended to be satisfied in cash.

11. PRINCIPAL MARKETS 11.1 The Paysafe Group has operations in Europe and North America and derives revenue from more than 200 countries and territories around the world. The Paysafe Group’s core stored value business is operated from ofﬁces within Canada and Europe and the core STP business is operated from ofﬁces within Europe, Canada and the US.

11.2 Geographical expansion forms a key part of the Paysafe Group’s growth strategy and the Skrill Acquisition further diversiﬁes the geographic presence of the Paysafe Group. The Paysafe Group currently operates principally in Europe, Canada and the US, which accounts for the signiﬁcant majority of the Paysafe Group’s revenues. The Paysafe Group’s principal operating subsidiaries are located in the UK, Germany, the Isle of Man, Canada and the US.

11.3 In FY2014, the Paysafe Group derived 21 per cent. of its revenue from Europe, 27 per cent. of its revenue from North America (including Canada) and the remaining revenue from the rest of the world. In FY2014, the Skrill Group derived 91 per cent. of its revenue from Europe, 1 per cent. of its revenue from North America and 8 per cent. of its revenue from the rest of the world. The Paysafe Group’s revenues derived from the Largest Merchant (which offers its services into China) are accounted for in its European revenues due to the merchant being located in Europe (US$133.8 million, US$104.9 million and US$59.7 million for each of the years ended 31 December 2014, 31 December 2013, and 31 December 2012 respectively). The Paysafe Group does not operate directly in China and relies on the services of an outsourced service provider to allow the Paysafe Group to continue to provide services to the Largest Merchant. The Paysafe Group plans to expand its product and service offerings to further penetrate its core European market and to expand internationally, including in the US.

70 11.4 The Paysafe Group operates in a sector characterised by the dominance of a few key global operators, such as Paypal, Worldpay and Wirecard, with a number of smaller companies offering niche or specialist digital payment solutions to speciﬁc local geographies or business verticals or through narrower, more targeted payment product offerings, such as Yandex, Dineromail and Frontstream.

NETELLERâ and Skrill 11.5 The Paysafe Group has positioned itself as a truly global digital wallet provider with a merchant offering that demonstrates international reach and direct relationships with customers. As such, the Paysafe Group principally competes with other global digital wallet providers, most notably PayPal, although PayPal is a significant player in the e-commerce vertical. The stored value market displays fragmentation on a geographic basis with a host of local digital wallet providers in various regions, including Alipay in China, DineroMail in Latin America and Yandex in Russia. These localised stored value providers are direct competitors to the Paysafe Group in specific geographies but are not considered to be material competitors by virtue of their narrower focus. 11.6 In terms of sector presence, the Paysafe Group’s digital wallet offerings derive a significant proportion of its revenues from online gambling and foreign exchange solutions. The user demographics of the digital wallets can be encapsulated as males with an average age of 32 and relatively high risk appetite for trading foreign exchange and online gambling. The Paysafe Group also operates its digital wallet proposition within the global digital goods vertical, although this exhibits a multitude of e-commerce payment providers as there is a distinct lack of interference points, supporting a fragmented stored value ecosystem catering to specialist audiences or geographies. 11.7 The Paysafe Group competes with other e-Wallet providers which have a direct relationship with customers such as PayPal, Click+Buy, Amazon and Google Checkout (owned by Google). In addition, other online businesses may develop competing payments systems or virtual currencies to enable their customers to make purchases on their platforms, such as Apple Pay, which enables Apple customers to make purchases using their mobile and wearable devices. paysafecard and Ukash compete with other providers of prepaid cards and vouchers such as, Prepaid Visa and Prepaid MasterCardâ products and 360Money provided by PrePay Technologies Ltd. A number of the other e-Wallet providers, PSPs and prepaid voucher providers with which the Paysafe Group competes have been in existence for longer, however the Paysafe Group’s products have a focus on smaller merchants with more complex payment needs (for example, higher fraud risk, multi-national / currency requirements, complex payment consolidation and flow). 11.8 Additionally, the Paysafe Group faces competition from alternative payment providers providing local payment options on a global scale, namely payment aggregators including Worldpay, Adyen and Global Collect. Although these payment aggregators do not offer a directly competing digital wallet product, with the key difference being that their solution is not offered on a pre-funded basis, their payment solutions are alternatives to digital wallets and therefore could compete with the Paysafe Group’s products and ultimately win market share. 11.9 The Paysafe Group is seeking to capitalise on the evolving regulated online gambling market in the United States as well as expanding its digital wallet presence into areas such as retail, online gambling, digital download, travel, fantasy sports, subscription, online dating and the ‘‘not for profit’’ market. The Directors believe that the Paysafe Group is currently well-positioned to benefit from these future growth initiatives, particularly following the completion of the US Acquisitions, bolstering its United States scale and payment capabilities.

paysafecard 11.10 paysafecard operates across over 40 countries and in 24 currencies, serving approximately 2,000,000 customers every month. paysafecard is based in Austria and operates principally in Europe but also makes it vouchers available through points of sale in Mexico, the United States, Canada, Australia, New Zealand, Peru, Uruguay, Kuwait and Argentina. paysafecard is supported by established chains which makes it easy for it to be reached by customers

71 worldwide. paysafecard competes with other providers of prepaid cards and vouchers such as Prepaid Visa and Prepaid MasterCardâ products and 360Money provided by PrePay Technologies Ltd.

Straight Through Processing 11.11 The Paysafe Group’s primary market in its NETBANXâ division is the ‘‘cardholder not present’’ segment, where it faces competition from other global payment service providers such as Worldpay, Wirecard and Digital River. The Directors believe that the Paysafe Group benefits from the ability to provide access to acquiring banks and risk mechanisms in multiple countries and territories, establishing a portfolio of higher and lower risk merchants creating a diversified risk profile for both the acquiring banks and the Paysafe Group itself. Given the Paysafe Group’s Principal Membership with Visa Europe and MasterCard Europe, allowing it to offer acquiring services to merchants in the European Union, the competitive landscape may in the future include acquiring banks, such as Barclays, AIB and Deutsche Bank once the Paysafe Group grows its acquiring services business. The Paysafe Group’s provision of STP includes the Asia Gateway service. Other than the Asia Gateway service, the majority of Paysafe’s merchants in the STP business are non-gambling merchants transacting online although Paysafe’s largest STP merchant is an online gambling merchant. The remainder of Paysafe Group’s STP merchants operate in a range of verticals including retail, digital content, travel, subscription, online dating, online gambling and the ‘‘not for profit’’ market, where FrontStream is a key competitor. 11.12 The Paysafe Group also competes with PSPs which provide merchants operating on the internet with a back-end payments platform, primarily in the form of a payments gateway. Notable PSPs include: GlobalCollect, Wirecard and Worldpay. Many large issuing banks and enterprise software providers also offer a PSP platform, including JPMorgan (through Chase Paymentech) and EVO Payments International GmbH. However, the majority of PSPs do not have an e-Wallet product and therefore do not have a customer relationship. 11.13 The Paysafe Group’s Asia Gateway service is provided through an outsourced service provider to merchants which in turn provide services into China. The Paysafe Group does not maintain any direct relationships in China and therefore does not directly compete within this market. The Largest Merchant uses the Asia Gateway service and operates within the online gambling market. The Asia Gateway service is provided to a number of European and Australasian based merchants.

Card services 11.14 The Paysafe Group’s Card Services division is based in the UK but the Paysafe Group is licensed to issue prepaid card solutions throughout the EEA. The Paysafe Group faces competition from other prepaid card issuers operating within the EEA such as MasterCard, Wirecard, AT&T and Euronet. The Paysafe Group is in a position to respond positively to increasing competition as it offers prepaid cards in multiple currencies and is in a position to offer customised physical and virtual prepaid cards, thereby improving customer engagement and providing opportunities for merchants to provide their online customers with special offers and promotions.

Payolution 11.15 Payolution is based in Austria and has operations in Germany and Switzerland. The Paysafe Group faces competition from other point-of-sale ﬁnance providers based in these regions as well as online providers of ﬁnance.

12. PRINCIPAL INVESTMENTS In the period between 1 January 2012 and the Latest Practicable Date, Paysafe acquired the following investments: (a) Paysafe acquired Meritus Payment Solutions, a payment processing entity based in California on 23 July 2014 for a sum of US$210 million, with US$150 million payable in cash and US$60 million of shares in Paysafe to be issued to the sellers over a four year period beginning on the ﬁrst anniversary of the completion date under the sale agreement (the ‘‘Meritus Acquisition’’);

72 (b) Paysafe acquired the trade and assets of GMA, a US based online payments company, on 23 July 2014 for up to US$15 million in cash, US$10 million of which was payable on completion of the acquisition and the balance based on future performance of the business (the ‘‘GMA Acquisition’’ and together with the Meritus Acquisition, the ‘‘US Acquisitions’’); (c) Paysafe completed the acquisition of Petal Payments Limited (now known as Optimal Payments Merchant Services (Mauritius) Limited) for a sum of £750,000 in cash (the ‘‘Mauritius Acquisition’’), payable to the seller on completion of the acquisition. The Mauritius Acquisition completed on 15 October 2014; (d) Paysafe acquired the entire issued share capital of FANS Entertainment Inc. for a sum of C$16 million payable to the sellers by issuing shares in Paysafe ExchangeCo Inc. (previously Optimal Payments ExchangeCo Inc.) which are exchangeable on a one-for- one basis into Ordinary Shares over the next three years, a portion of which may only be exchanged subject to the satisfaction of certain ﬁnancial performance criteria. The total number of shares in Paysafe ExchangeCo Inc. issued to the sellers was 3,163,633 (the ‘‘FANS Acquisition’’). The FANS Acquisition completed on 22 May 2015 and as at the Latest Practicable Date, 448,481 Paysafe ExchangeCo Inc. shares have been exchanged for Ordinary Shares; and (e) Paysafe acquired Sentinel Topco Limited (‘‘Skrill’’) for e719.6 million in cash and the issue of 37,493,053 Ordinary Shares to Sentinel Group Holdings S.A. (the ‘‘Skrill Acquisition’’). The Skrill Acquisition completed on 10 August 2015. Further details of the Meritus Acquisition, the GMA Acquisition, the Mauritius Acquisition, the FANSA Acquisition, the Skrill Acquisition and the FANS Acquisition are contained in paragraph 14 of Part XI (Additional Information) of this document.

13. THE PAYSAFE GROUP’S DEBT FACILITIES As at 30 June 2015, the Paysafe Group had total indebtedness of US$124.6 million and cash balances of US$806.9 million and as at 30 June 2015, the Skrill Group had total indebtedness of US$712.9 million and cash balances of US$662.3 million (including shareholder indebtedness of US$390.5 million consisting of loan notes and preference shares and accrued interest net of issue costs. The loan notes were redeemed as part of the Skrill Acquisition and the preference shares were acquired by Paysafe as part of the Skrill Acquisition). The remaining indebtedness of the Skrill Group was reﬁnanced as part of the Skrill Acquisition. As at 30 September 2015, the aggregate net indebtedness of the Paysafe Group was US$435.8 million.

14. RATINGS 14.1 On 15 June 2015, Moody’s announced that it was assigning a provisional ‘‘(P)Ba2’’ corporate family rating to the Company and a ‘‘(P)Ba2’’ rating to the Company’s senior secured term loan B, which forms part of the Company’s Credit Facilities. The outlook on Moody’s ratings is stable. 14.2 Separately, on 15 June 2015, Standard & Poor’s announced that it had assigned a ‘‘BB’’ long-term credit rating to Paysafe and a ‘‘BB+’’ issue rating to the Company’s senior secured term loan B, which forms part of the Company’s Credit Facilities. The outlook on Standard & Poor’s ratings is stable. 14.3 Moody’s and Standard & Poor’s are established in the EU and registered under Regulation (EC) No 1060/2009 (as amended) (the ‘‘CRA Regulation’’).

15. CORPORATE AND SOCIAL RESPONSIBILITY 15.1 Paysafe is committed to integrating corporate social responsibility within its businesses, supporting the continued generation of sustainable value and enhancing the Paysafe Group’s ability to deliver on its strategic objectives. The Directors believe that the Paysafe Group’s true value is reﬂected not simply by its balance sheet but through its intangible assets such as goodwill, the Paysafe Group’s people and the Paysafe Group’s reputation.

73 15.2 Although Paysafe is a low impact company due to the online nature of its services, it is committed to minimising its environmental impact by, for example, deploying high efficiency servers, ensuring computer and electrical equipment is switched off when not in use, recycling bottles and cans, discontinuing the use of paper cups at employee coffee stations and using environmentally-friendly cleaning products. As an employer with several offices around the world, Paysafe seeks to support the communities where Paysafe has operations by supporting local charities in these regions and aim to match charitable fundraising by individual employees. During FY2014, the Paysafe Group directly contributed US$105,842 to directly support charitable causes and continued to encourage employees to participate in charitable endeavours. Paysafe partnered with the Amyotrophic Lateral Sclerosis Society of Canada (‘‘ALS Canada’’) in 2012 and processed a record amount of online donations as part of the successful Ice Bucket Challenge in 2014 to raise awareness of ALS and treat and support people living with this disease. ALS Canada raised over $16 million as part of this campaign, with Paysafe separately donating $10,000 to ALS Canada’s campaign. Paysafe has also initiated micro-lending sponsorships to entrepreneurs through Kiva Microfunds in order to provide individuals with opportunities to become economically independent improve their standard of living and alleviate poverty. Paysafe has advanced approximately 520 loans totalling over US$51,000 to individuals in more than 55 countries. 15.3 During FY2014, Skrill Limited contributed e4,335 to charities such as Save the Children and BBC’s Children in Need and encourages employees to participate in charitable endeavours. Paysafecard contributed a further e10,466 to charites and community schemes including schemes that provide internet access to young, old and disadvantaged members of society and charities that support families with children suffering from serious illnesses. 15.4 By embracing policies and behaviours governing social responsibility, Paysafe creates more valuable relationships with its stakeholders by demonstrating its focus on managing material non-financial risks in its business.

74 PART II

ONLINE GAMBLING REGULATION

This section provides a description of the legal and regulatory environment as it applies to the supply of online gambling services. As well as the following general descriptions, attention is drawn to the section headed ‘‘Risk Factors’’ on page 16 of this document which describes speciﬁc risks associated with the operations of the Paysafe Group and in particular, the risk factor contained on page 16. Note in this section the reference to gambling indicates betting and casino gaming, poker, slots, bingo and lottery.

1. OVERVIEW 1.1 Online gambling is the newest and one of the fastest growing part of the world gambling industry and the regulatory environment to which the online gambling industry is subject is in a state of constant development. The regulation and legality of online gambling varies significantly from jurisdiction to jurisdiction as a variety of jurisdictions seek to regulate and tax gambling transactions and such laws and regulations are subject to conflicting interpretations. Some jurisdictions have sought to prohibit certain types of online gambling or online gambling in its entirety. 1.2 The Paysafe Group does not operate a gambling company and as a result in most jurisdictions does not require any gambling licences or associated regulatory permissions. However, the Paysafe Group’s NETELLERâ business offers an online alternative to traditional payment methods and NETELLERâ’s customers (being both the end users and operators or merchants) are primarily engaged in the online gambling industry. In addition, on 3 March 2014, the Paysafe Group launched a Net+ prepaid card stored value product in the US market aimed in part at the licenced US online gambling market. The Skrill Digital Wallet also facilitates a material number of transactions relating to online gambling and paysafecard is a prepaid cash voucher product which can be used for online gambling. In FY2014, the Paysafe Group and the Skrill Operating Group each derived approximately 53 per cent. of their revenue directly or indirectly from processing transactions for merchants and customers in the online gambling sector. 1.3 The global online gambling market is characterised by regulatory inconsistencies across many jurisdictions and frequent changes in the laws and regulations governing online gambling. Given the importance of the online gambling sector to the business of the Paysafe Group, the Paysafe Group expend significant time and resources to ensure that it has an in- depth understanding of the regulatory environment in the main territories in which their gambling industry merchants operate and customers reside, monitoring closely the developing regulatory regimes in those territories and adapting their own business acceptance policies where necessary. 1.4 The Paysafe Group has retained the risk assessment procedures historically followed by the Paysafe Group and the Skrill Group prior to Completion. However, a review of the Paysafe Group’s risk assessment procedures is currently being conducted with the aim of identifying countries where the Paysafe Group and the Skrill Group’s policies differed in order to form a decision as to how those countries should be treated by the Paysafe Group going forward. In addition, the review will identify the Paysafe Group’s top 20 countries, by revenue, within the online gambling sector. The Directors will then seek to refresh local law advice on a periodic basis in order to review the overall environment for online gambling activities in those countries and to consider whether any changes are required to the extent of the Paysafe Group’s business activities in those countries. 1.5 As part of this review, the Directors will also consider whether any additional countries should be considered to be prohibited countries due to the volume of the activity or the extent of the operations carried out by the Paysafe Group within the relevant country and the Directors will also consider the implementation of policies aimed at reducing the risk of the Paysafe Group or any of its Directors becoming subject to any investigations or enforcement proceedings, including the implementation of a travel policy for the Directors.

75 2. RISK ASSESSMENT PROCESS Skrill business 2.1 The Paysafe Group has systems in place to identify the geographic locations of its Skrill customers, identify the regulatory system to which such customers are subject and then determine whether such customers should be permitted to transact payments for online gambling through the Paysafe Group’s Skrill system. The Paysafe Group is able to use its technology platform to ensure that where it has taken a decision, for legal and/or policy reasons, not to accept gambling transactions from customers in particular territories, it can implement those decisions rigorously. 2.2 Before the Paysafe Group accepts Skrill business from merchants or customers for gambling activities, the Paysafe Group is careful to assess the risk for the Paysafe Group of accepting such business. The Paysafe Group’s determination as to whether or not to permit online gambling customers in a given jurisdiction to access the Paysafe Group’s services is based on a number of factors. These factors, among others, include the Paysafe Group’s understanding of: (a) what licences are held by the merchants and the strength of their legal position that the licences permit their activities or that no licence is required; (b) the laws and regulations of the jurisdiction where the merchants and customers are located, interpreted in accordance with applicable law; (c) the approach to the application or enforcement of such laws and regulations by regulatory and other authorities, including the approach of such authorities to the extraterritorial application and enforcement of such laws; (d) the willingness of online gambling merchants and other e-money and/or payment processing businesses to offer their services for gambling purposes in a particular jurisdiction; (e) the willingness of financial institutions in the Paysafe Group’s network (principally banks and card payment companies) and the Paysafe Group’s competitors to process funds in relation to online gambling by customers in a particular jurisdiction; (f) the cultural and religious characteristics of the jurisdiction in question which may determine or influence whether or not gambling is accepted; and (g) the potential for a challenge of a local licensing regime based on the Treaty of the Functioning of the European Union (‘‘TFEU’’). 2.3 When the legal position is unclear, the Paysafe Group will consider the above factors and make a decision whether to do business based on a review and weighting of the above factors. The Paysafe Group re-evaluates its assessment of individual jurisdictions as required and the categorisation applied and may change its view. For example, the Paysafe Group considers planned changes to legislation or court judgments which may affect its categorisation of any jurisdiction, and its willingness to transact gambling payments for customers located there. Such reviews take place as soon as practicable after becoming aware of them and when a review can meaningfully be undertaken. These reviews comprise the solicitation of legal advice (and updated advice) as well as the assessment of market intelligence which are then assessed by the Paysafe Group’s Business Conduct and Risk Committee and recommendations made to the Directors. Other gambling operators, regulators and other payments businesses and financial institutions may however take a different view of the legal environment in any particular jurisdiction. In this regard, the Skrill Group has created and uses the following three categories of classification:

Prohibited markets and operators 2.4 The Paysafe Group regards more than 60 countries as ‘‘prohibited’’ in respect of its Skrill business as a result of the strict regulation of online gambling in that country or other legal or cultural risk issues with offering its services in that country. Where the Paysafe Group classiﬁes a market as prohibited, such as Canada, China, Malaysia, the U.A.E., Iraq, Iran, North Korea or Turkey, the Paysafe Group may, depending on the market, either decline any customers in that market (irrespective of whether the end user intends to use the products and services for gambling) or decline to accept any gambling related transactions

76 from customers in prohibited markets. The Paysafe Group’s technology includes functionality which identifies the source of originating transactions and is able to block any gambling related business from any markets classified as prohibited. 2.5 In some jurisdictions, the Paysafe Group has agreed not to support certain black-listed operators after discussion with the relevant regulator overseeing the local licensing regime and (in most cases) tasked with enforcing the licensing regime. 2.6 The Paysafe Group has a policy in place to screen its Skrill customers upon customer account registration against the Specially Designated Nationals list published by the Office of Foreign Assets Control of the US Department of the Treasury and the HM Treasury sanctions list. Decisions to add or remove countries from the Paysafe Group’s prohibited list are taken on a country-by-country basis and the Paysafe Group adopts a risk based approach when making such decisions and, amongst other things, will conduct an assessment of the legal environment and assess the activities of operators, banks and other payment processors within the market. Regulated markets and operators 2.7 A number of countries have introduced regulations that welcome online gambling companies, provided they are licensed by the regulator in that country (as in Italy, the UK and Spain). 2.8 The Paysafe Group accepts online gambling business in these types of countries provided the merchant is licensed and treats the countries as a prohibited market if the merchant is unlicensed. The Paysafe Group’s approach to such operators will be dependent on its discussions with the regulator in a specific market to ensure that such merchant is white- listed (that is, known to the regulator as being licensed or not requiring a licence in order to operate its business) or not black-listed (that is, entities identified by the regulator as potentially being in breach of local laws). The number of jurisdictions which fall within this category is increasing. Several additional EU Member States are expected to be regulated in the next couple of years. Accepted markets 2.9 Where the market is not classified as either definitively regulated or prohibited, the Paysafe Group categorises it as accepted and as a result supports business processing payments in relation to online gambling from such jurisdictions. An example of a market not being definitely regulated is a market is which an online gambling licencing regime has been implemented where the Paysafe Group believes that the regime could be subject to challenge under EU law, for example where only a limited number of operators have been granted licences or impediments exist in the application process for which there is no obvious market justification. The Paysafe Group closely monitors the regulatory position in the major markets which the Paysafe Group has categorised as accepted markets to ensure that the level of risk to itself, its merchants and customers is acceptable. To implement this monitoring process, the Paysafe Group has created an experienced team with in-depth industry knowledge, who take a number of measures in order to ensure that they are well placed to make decisions to accept or decline business in particular jurisdictions and to deploy the Paysafe Group’s technology platform in order best to apply these decisions. These measures include taking specific legal advice, attending conferences and industry meetings, market studies on what banks and other payment processors do, exploring the regulatory position with others in the sector (including competitors and their own merchant base) and continually developing the Paysafe Group’s technology platform in order best to implement the Paysafe Group’s business acceptance policies. It augments this review with risk mitigation in ensuring that its operations, people and assets are not located in jurisdictions (even temporarily) where it is not clear that online gambling is legal. 2.10 In making the assessment for each relevant country, the Paysafe Group will assess the risk in the market, the approach of the Paysafe Group’s competitors and the likelihood of enforcement action being taken. The Skrill Group regularly reviews its categorisation of jurisdictions of existing gambling merchants and customers as the regulatory environment within countries changes over time which may, along with a potential change in the Paysafe Group’s attitude towards risk, result in the Paysafe Group reconsidering its approach. It is also possible that, while the Paysafe Group’s assessment of a jurisdiction may not change, enforcement action could still be taken against the Paysafe Group and/or its senior managers or directors, depending upon the local laws in the relative jurisdiction.

77 NETELLERâ and NETBANXâ 2.11 The Paysafe Group also reviews legal risk in relation to its activities in its NETELLERâ and NETBANXâ divisions. It considers the law (including its scope and applicability), any localised licensing regime, and enforcement activity. It also reviews the business practices and credibility of its merchants’ business models. 2.12 Currently, the Paysafe Group categorises more than 40 countries and territories as ‘‘banned’’ or ‘‘non-serviced’’ in which customers cannot open NETELLERâ accounts as a result of the legal or cultural risk issues arising from offering its services in that country (for example, Iraq, Iran, Libya, North Korea, Syria and Zimbabwe) and a further ﬁve countries in which it declines to accept any gambling related business from its NETELLERâ customers as a result of the strict regulation of online gambling in that country (for example, Singapore, Turkey, Canada, and prohibited US jurisdictions (all states except Delaware, Nevada and New Jersey)). The Paysafe Group deploys BIN blocks and geo location software to ensure compliance. The Paysafe Group also seeks to manage its risk in other ways. For example, the Paysafe Group does not have any direct relationships with any merchants or customers located in China and does not provide services directly in China. As such, Paysafe treats China as a ‘‘non-serviced’’ country for its NETELLERâ business. In relation to the Paysafe’s NETBANXâ business, and the Asia Payments Gateway, the Paysafe Group contracts with a third party outsourced service provider who uses a network of local processors to process the transactions for the merchants’ Chinese customers obviating the need for the Paysafe Group to transact directly with those customers in China. Finally, it manages the ﬁscal exposure of payments being blocked by contractually requiring some merchants to absorb the risks of end user monies being frozen or declined in the banking system. 2.13 Paysafe periodically reviews its list of prohibited countries. Decisions to add or remove countries from Paysafe’s prohibited list are taken on a country-by-country basis and a risk based approach is taken when deciding whether to withdraw its services from a particular country. Where appropriate, the Paysafe Group will also conduct an assessment of the legal environment and assess the activities of operators, banks and other payment processors within the market when taking such decisions.

3. REGULATORY CHANGE: TRENDS AND OUTLOOK 3.1 Although the general trend in gambling regulation over the last ten years has been to seek to restrict the activities of online-based operators, in the EU this has generally resulted in a move towards controlled regulation, rather than absolute prohibition. For example, the regimes in Italy and France have both moved away from state-run monopoly-based markets to controlled regulation. In addition, online licensing regimes have been implemented in Belgium, Bulgaria, Cyprus, Estonia, Latvia, Romania and Spain. Germany, Greece and Poland have online licensing regimes but these have been the subject to EU legal challenge. It should be noted not all regimes license all types of gambling products. 3.2 Changes in the regulation of online gambling in the markets described above and elsewhere may impact the Paysafe Group both positively (where the markets are liberalised or become regulated) and negatively (where markets are restricted or become prohibited). The Directors remain cautiously optimistic that future developments in the regulation of online gambling around the world will likely provide enhanced growth opportunities in the medium to long term. However, the Directors anticipate that in the short to medium term, in certain territories, revenue will decrease during periods of uncertainty, disruption or change while regulation is implemented and operators go through the process of applying for and obtaining licences. Likewise, operators who fail to obtain licences may elect to block the jurisdiction and additionally in circumstances where challenges against the regime, invoking European law, have failed. In addition, the heavier taxes, compliance costs, levies and licence fees which merchants are obliged to absorb will also cause businesses to close, or reduce their ability to pay for the Paysafe Group’s products and services. The risk is mitigated by the high levels of geographic diversiﬁcation in the Paysafe Group.

4. COUNTRY SPECIFIC REGULATORY OVERVIEW The following sections provide a summary of the legal and regulatory issues arising from the material markets in which the Paysafe Group. For the purpose of this document, the Paysafe Group’s material markets are considered to be those jurisdictions from where the

78 Directors believe that three per cent. or more of the Paysafe Group’s revenue is (as at 30 June 2015, assuming that the Skrill Acquisition had completed as at that date) or, in the next two years may be ultimately derived. Following an overview of EU gambling regulation and the relevant countries within the EU, the following summaries have been set out in alphabetical order.

5. EU GAMBLING REGULATION 5.1 The approach to the regulation of online gambling in Member States is inconsistent and gambling is expressly excluded from directives which address other forms of pan-European digital sales. There have been several attempts by regulatory authorities in Member States, and by state licensees and monopoly operators, to apply domestic criminal, administrative and unfair competition laws to prevent online operators licensed in other Member States from operating in or providing services to customers within their territory. These attempts have been contested by operators that have argued that the freedom of establishment and the freedom to provide services under articles 49 and 56 of the TFEU allow them to supply their services under licence from the authorities in one Member State to customers in another Member State, and prevent them from being excluded from domestic licensing regimes on grounds of nationality or otherwise. 5.2 Consequently, a large volume of litigation has been generated before the domestic courts of many Member States. However, rulings have gone both ways (in favour of governments or those making the challenge) and the only consistent findings in relation to gambling are first, that there is no obligation upon Member States to mutually recognise the validity of non- domestic licences, and second, that there is a wide margin of discretion afforded to Member States to determine its own laws and approach to online gambling unlike other products and services. The Commission (the executive arm of the European Union) despite extensive lobbying by the online industry has declined to recommend a directive to permit passporting of online gambling in the same way as is permitted for certain financial services. Instead it has elected to make a Recommendation to Member States (which does not have the force of a Directive) that they find ways in which to find common standards for customer protection. Again, despite the fact that the Commission has taken action against certain Member States for non-compliance with the TFEU it has not resulted (in every case) with revised laws, policies and regulations. However, such actions have tended to reinforce the bases for operators who continue to justify a supply to the jurisdiction. 5.3 A number of Member States are introducing or have introduced specific provisions in their national gambling laws concerning the blocking of payments between players and gambling operators not authorised to offer their services in the relevant Member State. However, these tend to be in the minority. 5.4 There are some Member States that have taken a relatively liberal approach to the regulation of online gambling, such as Denmark, Italy, Spain and the United Kingdom. In some Member States, such as Cyprus, online sports betting is regulated but other online games such as online casino games are prohibited. However, the regulatory environment is constantly evolving and some Member States such as Sweden and the Netherlands, are considering a move towards a more liberal regime under which some types of online gambling services are permissible. Online gambling operators must be (or will be required to be) licensed in order to operate in these jurisdictions. There is therefore a risk that, by facilitating payments involving merchants not licensed in that jurisdiction and their customers, the Paysafe Group may face (accessorial) liability in relation to unlawful online gambling. 5.5 Other Member States, such as Finland and Norway, take a much more restrictive approach to the regulation of online gambling. Regulatory authorities in such jurisdictions have sometimes taken a passive approach to enforcement of the prohibitions, in particular in relation to operators established outside of the jurisdiction; others are more rigorous in their approach. To date, such actions (if any) have largely targeted gambling operators or entities with a local presence such as media companies and banks. However, processing payments in connection with any online gambling in these jurisdictions may expose the Paysafe Group to the risk of (accessorial) liability. It is possible that the restrictive regulations in some Member States may be challenged as being incompatible with the TFEU, however, it is uncertain whether such a challenge would be successful, or that it would form a valid defence to a criminal prosecution.

79 5.6 Outside Europe there are no trade freedoms that support cross border activity as the majority of territories exclude gambling from their obligations as members of the World Trade Organisation under the General Agreement on Trade in Services.

6. GERMANY 6.1 The Paysafe Group provides payment processing services to customers engaged in online gambling activities in Germany. In Germany, there has been a shift from a state monopoly system with an absolute ban on all online gambling services towards a more liberal regime under which at least some types of online gambling services are permissible. The CJEU rulings in the Carmen Media case (joint Cases C-317/07 et al, C- 46/08), in which the court raised doubts concerning the compatibility of the German state monopoly on sports betting with EU law, increased the need for a change in the German regulatory system of the 16 federal states. 6.2 Under the Gambling Act of Schleswig-Holstein (Gesetz zur Neuordnung des Glu¨cksspiels), which was valid between 1 January 2012 and 8 February 2013, 25 online sports betting licences and 23 licences for online poker and casino games without a banker (casino games with a banker are reserved for land-based casino licences) were awarded to domestic and European operators for the state of Schleswig-Holstein. However, a new Interstate Treaty on Gambling (Glu¨cksspiela¨nderungsstaatsvertrag, (‘‘Interstate Treaty on Gambling 2012’’) was introduced on 1 July 2012, and Schleswig-Holstein became party to the Interstate Treaty on Gambling 2012 on 8 February 2013. As such, as of 8 February 2013, the Interstate Treaty on Gambling 2012 is applicable in all 16 federal states. The licences granted under the Gambling Act of Schleswig-Holstein, however, remain valid for their duration (six years). 6.3 Pursuant to the Interstate Treaty on Gambling 2012, online casino games and poker are prohibited. However, lotteries (subject to a state monopoly), horse race betting and sports betting can be permitted on the internet (under certain restrictions, such as limits on stakes). 6.4 Furthermore, according to the Interstate Treaty on Gambling 2012, the state monopoly on sports betting is suspended for an experimentation phase (initially until 30 June 2019). The Interstate Treaty on Gambling 2012 provides that up to 20 concessions may be awarded to (state and/or private) operators for the duration of the experimentation phase following a tender. In notification proceedings under Directive 98/34/EC, the Commission raised concerns about the compatibility of the online gambling regime of the Interstate Treaty on Gambling 2012 with European law. The tender process for the sports betting concessions was initiated in August 2012 and after several delays, the competent authority (Ministry of the Interior and Sport in Hesse) announced in September 2014 the 20 applicants to which it intends to award the concessions. Most of the applicants not considered in the decision of the authority filed for injunctive relief delaying the process. On 5 May 2015, the Administrative Court of Wiesbaden ordered the authority, by way of injunctive relief, to refrain from awarding any licences until there is a final decision in the main proceedings. The court found that the tender did not comply with the required transparency and non- discrimination principles and is therefore is likely to be in violation of the relevant European laws. This decision was upheld by the Appellate Court (Higher Administrative Court of Hessen) on 16 October 2015 confirming a violation of the relevant European laws but also the German constitutional law. The tender process and the licence grant will therefore be further delayed substantially and it is very likely that the licensing framework set out in the Interstate Treaty on Gambling 2012 will now need to be re-evaluated. In fact, in October 2015 the government of Hesse has already suggested five new ‘‘guidelines’’ for an adjustment of the Interstate Treaty on Gambling 2012, including legalized online casino games and an unlimited number of sports betting licences. These guidelines will serve as a basis for the political discussion about potential legal reforms. 6.5 According to the amendments to the German Horse Race Betting and Lotteries Act, which also entered into force on 1 July 2012, online sports betting targeting German customers is subject to a five per cent. tax on stakes, irrespective of whether the respective organiser holds a licence. Tax authorities have recently sent out information letters to sports betting operators requesting information on compliance with the German Horse Race Betting and Lotteries Act. Non-compliance bears a significant risk of tax (criminal) law prosecution, including against individuals.

80 6.6 Many operators licensed in other EU jurisdictions have continued to take German business, relying upon the argument that the restrictions imposed by the Interstate Treaty on Gambling 2012 are in breach of European market freedoms and therefore unenforceable and that the tender process for the sports betting concessions fail to meet fairness and transparency principles enacted under European laws. There is still no definitive German case law on the Interstate Treaty on Gambling 2012’s compliance with European laws, and the courts of lower instance take different views. In its decision of 7 May 2014, the district court Sonthofen (Amtsgericht Sonthofen) referred questions on the legality of the tender process for the sports betting concessions to the CJEU. On 22 October 2015, Attorney General Szpunar issued a non-binding opinion on this case, which emphasised that the tender process should follow the criteria of ‘‘equality, non-discrimination in respect of nationality and transparency’’. He also stated that a system under which only public bodies can be expected to obtain a licence is flawed and must be found incompatible with European law. The CJEU’s judgement in this case is pending under file number C-336/14 and is expected later this year, or early 2016. 6.7 The offering of public games of chance without a (German) licence is subject to administrative fines and may qualify as a criminal offence under German laws. The offering of public games of chance without a licence qualifies as a predicated offence under money laundering rules, and the acceptance or handling of respective proceeds may trigger the criminal offence of money laundering under German law. 6.8 The Interstate Treaty on Gambling 2012 further provides that payment service providers may be requested by the competent authority to cease handling proceeds resulting from illegal gambling activities.

7. GREECE 7.1 The Paysafe Group provides payment processing services to customers engaged in online gambling activities in Greece. Under the new Greek Gaming Law (4002/2011, as amended by Laws 4038/2012, 4141/2013 and 4261/2014), online gambling operators require a licence by the Hellenic Gaming Commission (the ‘‘HGC’’). Until the issuance of the relevant licences, operators with a licence from another EU or EEA member state may continue providing their services within Greece under the condition of becoming subject to a specific tax regime. Only 24 interim licences have been awarded, but in practice many more companies offer services through partnerships with the licence holders. 7.2 In its decision Stanleybet (joint cases C-186/11 and 209/11) on the Greek monopoly on sports betting and lottery games, the CJEU confirmed its previous case law on the justification requirements for establishing monopolies. In the event that the monopoly was considered to be incompatible with EU law by the competent national court and the case was referred back to the CJEU, the CJEU also stressed that the Greek authorities could still take the view that a reform of the existing monopoly would be the better measure for ensuring the regulatory objectives pursued than a liberalisation. Despite this, the Greek government submitted a new draft law to the European Commission to withdraw the licences (lodged in March 2014). This has also been the subject of challenge. In the meantime in the Stanleybet and William Hill case, the Greek Council of State (the country’s top administrative court) rendered its ruling and has now rejected the joint petition of two operators further entrenching the Greek monopolistic regime. The State Council has thus adopted the view that the establishment of a gaming monopoly in Greece is required to ensure a high level of customer protection and that the current legislative framework aims to reduce illegal gaming opportunities, by reference also to the changes implemented to the Greek gaming framework over the course of the last three years (Law 4002/2011, set up of HGC as the Regulating Body). 7.3 In late 2012, the HGC also announced its decision to elaborate a blacklist of ‘‘unauthorised websites’’ on the basis of which internet service providers and payment service providers shall block websites and payments. Service providers which do not comply with such an order face administrative or criminal sanctions. This change was notified to the European Commission and the relevant standstill period has now expired. The black listing when published prompted a number of operators to block the territory as only those holding an interim licence were not included on the list.

81 7.4 To date, the Directors are not aware of any sanctions imposed on payment service providers on the basis of law 4002/2011 or the decision that was notiﬁed under Directive 98/ 34/EC (no. 2012/710/GR), apart from the interruption of the transmission and visibility of ‘‘unauthorised websites’’, as well as related bank transactions.

8. UNITED KINGDOM 8.1 The Paysafe Group provides payment processing services to customers engaged in online gambling activities in the UK. The Gambling Act 2005 (‘‘Gambling Act’’) is the primary legislation in relation to both land-based and online gambling in the UK. The Gambling Act covers two main activities: the provision of facilities for gambling and the use of premises for gambling, but does not apply to the National Lottery which is regulated under separate legislation and has a single appointed operator, currently Camelot. The Gambling Act is relatively sophisticated with different levels of regulation for different gaming activities (for example, casinos, betting and remote gaming activities). There is no restriction on the number of private operators who can apply for operating licences under the Gambling Act. 8.2 On 1 November 2014 the Gambling (Licensing and Advertising) Act came into force which requires any operator (regardless of where they are located) who allows customers to access gambling facilities provided by them whilst in England, Wales or Scotland to obtain a UK operating licence. Licensees are required to pay operating fees and comply with the licensing conditions and codes of practice attached to their licence. In most cases operators must also identify individuals within the organisation to hold Personal Management or Personal Functional Licences. The licence status of operators is available on the regulator’s (the Gambling Commission) website. 8.3 The Paysafe Group may be exposed to a risk of liability for processing payments from unlicensed online gambling operators as it might arguably be knowingly providing facilities for or promoting unlicensed gambling, albeit there is no specific reference to payment processing in the Gambling Act. 8.4 On 1 December 2014 a new tax regime came into force which levies a 15 per cent. duty on the profits made by remote gambling providers from betting and gaming activities carried out with any UK resident (which means that the tests for determining whether a licence is needed or tax is payable are different). The duty also applies regardless of where the business providing those gambling facilities is located, or where the UK resident is located at the time when the facilities are accessed. This is a change to the previous system whereby gaming activities were only taxable if they were supplied by the operator through the use of remote equipment within the UK or if a relevant entity held a remote gaming licence, albeit there were complex provisions for determining where a sportsbook operator was deemed to be located. The new regime is currently subject to a legal challenge by the Gibraltar Betting and Gaming Association by way of judicial review on the grounds that the tax breaches EU law and will lead to customer detriment. The matter has been referred to the CJEU albeit this has not prevented the tax provisions from being implemented. Most gambling operators with a material UK customer base have faced significant tax increases as a consequence. In addition, sportsbook operators, unlike gaming operators, will face the added challenge of not being able to deduct the marketing costs of free bets and other promotional offers from the calculation of net betting receipts which will in effect increase their costs of marketing. Also the horseracing levy is in the course of being replaced with a Horse Race Betting Right, which is likely to require non-UK based operators to also pay it in circumstances where they take bets on UK horse racing events. This too could have an impact on the operating margins of sportsbook operators, as it is likely to apply, irrespective of where the customer is based. 8.5 Merchants as part of their gambling licensing obligations also have to adhere to anti money laundering requirements but the Proceeds of Crime Act 2002 (‘‘POCA’’) applies to a wide range of activities in the UK, irrespective of whether a person is in a regulated sector or licensed offshore. In cases where the activity giving rise to the criminal property takes place in another jurisdiction POCA was amended to allow a defence in circumstances where there was a reasonable belief that the activity in that jurisdiction was lawful. In the case of online gambling it is moot where the activity actually takes place, given it could be argued that it simultaneously takes place both where the customer and merchant are located, and it may be unlawful for the customer to gamble even if the merchant holds a licence for the activity

82 where it is based. It may also be unlawful for a local payment provider, even if it is not unlawful for the customer. In addition if the underlying activity is not deemed to be gambling but money laundering that would be unlawful in most jurisdictions.

9. CHINA AND HONG KONG 9.1 The Paysafe Group does not provide services directly in China and instead relies on the services of a third party outsourced service provider in order to enable it to provide services to the Largest Merchant. The Largest Merchant provides online gambling services to a number of countries including to customers based in China, however, these services are provided remotely from its operational base in Europe. The Largest Merchant does not have a direct contractual relationship with the outsourced service provider nor does the Largest Merchant have a presence in China, locate any persons, assets or infrastructure in China or use the services of any agents, aggregators or affiliates located in China. The Largest Merchant is licenced in Europe and, to the best of the knowledge and belief of Paysafe, has maintained its licence in good standing with the relevant regulators. 9.2 There are two primary laws regarding gambling in China. These are the PRC Criminal Law (the ‘‘Criminal Law’’) and the Law of the PRC on Penalties for Administration of Public Security (the ‘‘Law on Penalties’’), the latter addressing ‘‘administrative’’ offences. The Criminal Law focuses mainly on restricting the activities of gambling operators (and their agents) in China (although it also restricts the activities of individuals that make gambling ‘‘their occupation’’). Under the Criminal Law, China can assert authority over any Chinese national who commits a crime wherever it takes place, or over foreign nationals if their crime or the result of the crime occurs in China but only in relation to offences that are criminal in the jurisdiction where they are committed. The Law on Penalties extends the regulatory provisions relating to gambling activities from operators to a wider group of participants and other individuals who ‘‘provide conditions for gambling’’. There is no clear distinction in the definitions or the scope of the Criminal Law or Law of Penalties regarding what is ‘‘criminal’’ versus ‘‘illegal’’ gambling activities, although the latter is regarded as a less serious violation. 9.3 Although the Criminal Law and Law on Penalties do not specifically address remote gambling activities, the associated regulations and published interpretations extend to remote gambling as well as the services provided to support remote gambling. Pursuant to the Interpretation on Issues Concerning the Application of Law in Criminal Gambling Cases (‘‘Gambling Case Interpretation’’), setting up a gambling website on the internet will be considered as gambling crime and includes any entity who accepts wagers on behalf of an operator. In addition, the Opinions regarding the Application of Law in Criminal Online Gambling Cases (the ‘‘Gambling Opinion’’) makes it clear that a service provider can be considered as an accomplice of a gambling crime if it provides settlement services for online gambling website(s). 9.4 However, there is no legislation that expressly deals with the supply of remote gambling by offshore websites operated by non-Chinese nationals into China or offshore service providers operated by non-Chinese nationals to such offshore websites. Having obtained legal advice in relation to this, the Directors believe it is highly unlikely that Chinese laws should be interpreted to apply or be capable of being enforced extra-territorially against such offshore websites and service providers, including the Paysafe Group and its merchants. 9.5 China has also put in place a comprehensive set of currency control measures. Under this foreign currency control regime, foreign currency transactions are divided into two categories: current account or capital account. According to relevant rules and regulations, Renminbi (‘‘RMB’’) can be converted into foreign currency and remitted offshore if it falls into current account, provided that required documents can be produced to the remitting bank and tax authority. Capital account transactions can be processed subject to the supervision of State Administration of Foreign Exchange. However, gambling payments are classified as neither current account transactions nor capital account transactions as set out in paragraphs 9.2 and 9.3 above. 9.6 Transferring of gambling funds is not a money laundering offence under the PRC Anti- Money Laundering Law (the ‘‘Anti-money Laundering Law’’) or the PRC Criminal Law. However, in 2009, the Interpretation of the Supreme People’s Court on Several Issues concerning the Specific Application of Law in the Trial of Money Laundering and Other

83 Criminal Cases, included the ‘‘assisting in the conversion of the crime-related income or proceeds therefrom into gambling income by means of gambling’’ as a means of money laundering. 9.7 The Anti-Money Laundering Law requires financial and some specific non-financial institutions incorporated in China to be responsible for establishing identifying and reporting systems to counter money laundering. Chinese regulations on money laundering also stipulate that the facilitation of proceeds of crime payments is an offence and the published official interpretations make it clear that financial institutions might be considered accomplices of gambling if services are provided to online gambling websites. Again, it is unclear whether those interpretations are intended to encompass, and whether the relevant statutes and regulations would be judicially construed to encompass, financial institutions located outside of China with no direct contractual relationships to the relevant Chinese persons. 9.8 It therefore appears that the money laundering legislation in China does not address the operation of foreign gambling websites in a direct way, nor the processing of payments involving such websites. However, the monitoring system required by the Anti-Money Laundering Law may help Chinese authorities to track specific websites, which may then lead to such attempts at enforcement such as website blocking but it is unlikely to extend to tracing funds associated with gambling. 9.9 Hong Kong is not a territory from which revenues are derived from gambling. However sums due to the Paysafe Group are matched and paid from Hong Kong by an entity affiliated to the Chinese payment service providers. Although no sums are paid to and from China through Hong Kong, the sums settled are calculated by reference to gambling debts and therefore could be said to represent them. 9.10 Section 7 of the Gambling Ordinance (‘‘GO’’) in Hong Kong makes it an offence to engage in bookmaking in Hong Kong. Under the GO, ‘‘bookmaking’’ is defined as the ‘‘the soliciting, receiving, negotiating or settling of a bet by way of trade or business’’. Under section 14 of the GO it is an offence to provide money knowing it is to be used in connection with unlawful gambling. It is also an offence under subsection 16B(1) of the GO to knowingly promote or facilitate bookmaking or betting with a bookmaker. 9.11 However, subsection 16B(1) does not apply if the bet in question can only be placed or is placed by a person outside Hong Kong (which would include, for these purposes, China). Although, the provisions of sections 7 and 14 of the GO do not contain this qualification they are unlikely to apply to the entity in Hong Kong. In the case of both sections, they are intended to prohibit activities related to bets being placed from Hong Kong (the Paysafe Group blocks payments relating to gambling in Hong Kong) for both merchants and customers, resident or located in Hong Kong. Moreover, in the case of section 7 it is unlikely that payment support could be deemed to be ‘‘bookmaking’’ as defined in the GO. In the case of section 14 too there is no act taking place amounting to a provision of money or other property to be used in connection with unlawful gambling (i.e. to be used for the purposes of gambling in or from Hong Kong). 9.12 The provisions of the Organised Serious Crimes Ordinance (‘‘OSCO’’) are drafted very widely. Under section 25(1) of the OSCO it is an offence for a person to deal with property where they know, or have reasonable grounds to believe, that such property represents, directly or indirectly, the proceeds of an indictable offence (an indictable offence is a more serious offence that can be tried on indictment in the Hong Kong District or High Courts). This offence extends to property which is derived from conduct which had it taken place in Hong Kong would be an indictable offence there. However case law has established that it must be a dual offence (that is such conduct must constitute an indictable offence both under the law of the territory where the activity actually took place and would have amounted to an indictable offence had it occurred in Hong Kong). In China a customer’s participation in online gambling is not unlawful although the facilitation of payments related to online gambling from within the PRC may constitute a criminal offence. It is possible that section 25(1) of the OSCO could apply to the money changer in Hong Kong who as part of the payment support is responsible for accounting for and remitting the settlement funds to the Company and may therefore be deemed to be receiving in Hong Kong the proceeds of an indictable offence in China. Under section 89 of the Criminal Procedure Ordinance

84 (‘‘CPO’’) anyone that aids, abets, counsels or procures a person to commit an offence under section 25(1) of the OSCO is equally guilty of the same offence and is subject to the same penalties as the principal offender and therefore there is a risk that the Company or the Directors could be prosecuted. However, for the offence under section 25(1) to be made out, the underlying conduct must also be an offence had it taken place in both territories (China and Hong Kong). Arguably the activity or conduct to be considered under OSCO is the facilitation in Hong Kong of gambling in China, which is not illegal in Hong Kong provided bets can only be placed or are placed by a person outside Hong Kong. As it is unlikely that the money changer in Hong Kong who as part of the payment support is responsible for accounting for and remitting the settlement funds to the Company would be guilty if prosecuted under section 25(1) of OSCO and accordingly there would be no principal offence under section 25(1) of the OSCO, the risk of prosecution of a member of the Paysafe Group or of the Directors of the Company under section 89 of the CPO is very low and this risk is further reduced as the Directors are not physically present in Hong Kong. However, there are no legal precedents; if the conduct or activity that falls to be considered (in order to consider whether the OSCO provisions are engaged) is the facilitation in Hong Kong of gambling in Hong Kong, which is illegal if unlicensed, there is a risk of prosecution of the money changer (under section 25(1)), a member of the Paysafe Group or the Directors of the Company (under section 89). This is however considered unlikely, not least because the Paysafe Group does not actually facilitate any gambling payments for Hong Kong customers.

10. JAPAN 10.1 The Paysafe Group provides payment processing services to customers engaged in online gambling activities in Japan. Gambling is generally prohibited under the Japanese Penal Code, with some exceptions, regardless of whether it is undertaken remotely or based on land. ‘‘Gambling’’ is defined as ‘‘a contest for wins or losses with the results determined by chance and where money or items are at stake’’. At least two persons must participate for the contest to meet the statutory definition of ‘‘gambling’’. 10.2 Given gambling is generally prohibited in Japan there is no licensing regime for online gambling and only certain government running/sanctioned land-based gambling is licensed (there are no land-based licences available for casino, bingo or poker). Gambling is considered as a crime under the Penal Code. 10.3 While the Japanese Penal Code generally prohibits gambling, Japanese law does not expressly address or prohibit offshore internet gambling. As such internet gambling companies offering their websites in Japanese to Japanese citizens living in or outside of Japan and Japanese citizens accessing such sites may, in theory, be violating Japanese criminal law. 10.4 However, the Penal Code’s prohibitions on gambling do not provide for extra-territorial enforcement, thus enforcement and prosecution against operating online offshore casino and using such gambling websites is not possible under the Japanese law and practice. Since the laws do not allow for enforcement against offshore operators and online gambling is not expressly prohibited, offshore internet gambling falls into a legal grey zone. Therefore as long as the internet gambling website is truly ‘‘offshore’’ it will not be punishable under the Japanese law and ‘‘offshore’’ means entities with no people, presence or assets in Japan. 10.5 On the other hand, if there is a local Japanese affiliate assisting an offshore operator by offering gambling services or collecting payments on behalf of the operator, depending on the operational scheme or function of the local affiliates in Japan, such local affiliates (for example, local establishments, agents or software suppliers) might be committing a primary offence of violating the prohibition. Assuming the local marketing affiliates refer customers to the Company’s websites and are paid a percentage of the revenue earned from referred customers, the local affiliates would be deemed as aiding and abetting the primary offence of gambling by the offshore operator irrespective of whether the offshore operator has any presence in Japan. 10.6 As long as the offshore online gambling website is lawful in the country in which the company and its servers are based, the revenue related to such offshore online gambling website does not fall under the definition of ‘‘criminal proceeds’’ under the Act on Prevention of Transfer of Criminal Proceeds (the primary Japanese anti-money laundering statute).

85 Therefore the remittance of payments between end users and the offshore online gambling operator will not be prohibited under Japanese law as long as the offshore gambling operator is in compliance with laws of its home jurisdiction. 10.7 It is possible the business operator (for example, the credit card issuing bank or credit card company) will report payments to the relevant authority (i.e. Financial Services Agency (for banks) or the Ministry of Economy, Trade and Industry (for credit companies)) if they believe the transactions constitute a ‘‘suspicious transaction’’ and the authorities could order the banks or credit card companies to stop processing the transactions. 10.8 Both the Financial Services Agency and the Ministry of Economy, Trade and Industry have conﬁrmed there are no regulations prohibiting the banks/credit card companies from processing such transactions. 10.9 Despite this, in practice certain banks and credit card companies may refuse to process transactions for offshore gambling websites. While there is no clear legal rationale for refusing to process the transactions the banks and credit card companies may have their own internal rules against processing transactions related to gambling.

11. US GAMBLING REGULATION As set out in Part I (Information on the Paysafe Group), the Paysafe Group is intending to pursue a strategy aimed at strengthening their presence in the US gambling market and, therefore, whilst the level of revenue currently derived from the US online gambling market is small, an overview of the US online gambling regime is included in this Part II.

Paysafe Group’s US Business Prior to 2007 11.1 Prior to 2007, the Paysafe Group processed payments in connection with online gambling in the USA. However, the Paysafe Group terminated all US-facing online gambling-related activities as a result of the introduction of the Unlawful Internet Gambling Enforcement Act (‘‘UIGEA’’) in the US in 2006, which banned processing of payments related to illegal online gambling. 11.2 The Paysafe Group’s historic US business consisted of the following:

Neovia 11.3 The Neovia business was founded in 1999 as NETeller Inc. in Calgary, Canada. With effect from 31 December 2003, NETeller Inc. transferred its business and undertaking to Paysafe (at the time known as NETeller plc). 11.4 Neovia’s processing almost exclusively involved the use of the ‘‘NETELLERâ’’ stored-value e-Wallet. E-Wallets allowed customers to maintain funds in the ‘‘wallet’’ and then direct that they be deposited with participating merchants. Similarly, customers could withdraw funds from a merchant back to the e-wallet and, if desired, back to their individual bank accounts. Methods of funding included credit card, ACH and wire-transfer, among others. Within days of enactment of the UIGEA in October 2006, Paysafe publicly announced its intention to withdraw from the US market. Paysafe communicated its intention to terminate its US-facing activity within 270 days of the statute’s enactment. It chose that timeframe in light of the expectation, set out in the UIGEA itself, that regulations implementing the law would be issued by that date. 11.5 However, events rapidly overtook the Paysafe business. On 15 January 2007, the Ofﬁce of the United States Attorney for the Southern District of New York (‘‘USAO’’) arrested two former senior executives and founding shareholders of NETeller Inc. and seized approximately US$60 million in funds belonging to Paysafe’s US customers that were in transit at Paysafe’s US processing partners. At the same time, the US Government obtained orders that prohibited Paysafe from engaging in any further transactions with US banks, effectively preventing US customers from withdrawing their funds. 11.6 The two former founders of NETeller Inc., neither of whom was an employee of Paysafe at the time of their arrests, were charged with intent to promote unlawful gambling activity in violation of federal and state laws. Neither the two founders nor any member of the Paysafe Group were charged with fraud or any similar offence. The USAO’s allegations centred exclusively on gambling and unlicensed money transmitting violations.

86 11.7 As a result of the US government actions, Paysafe, on 18 January 2007, suspended all US gambling- related processing and negotiated a plan to facilitate the complete return of funds to its US customers. Ultimately, both former founders pled guilty to a single count of conspiracy to violate US gambling and money-transmitting laws and agreed to a combined forfeiture of US$100 million. Shortly thereafter, on 17 July 2007, Paysafe entered into a deferred prosecution agreement (‘‘DPA’’) with the USAO, resolving its past US-facing activity. The DPA provided for forfeiture of US$136 million, completion of the return of funds to US customers and the appointment of a forensic accounting ﬁrm to monitor Paysafe’s activities in order to ensure that it continued to comply with the bar on US-facing gambling- related transactions. The DPA also imposed an on-going obligation to cooperate with any further USAO inquiries. In return, the USAO agreed to defer any prosecution for (non-tax) violations for two years. All customers subsequently had their monies returned, and the USAO obtained dismissal of the complaint and terminated the DPA in August 2009.

Optimal Payments 11.8 On 20 January 2011, Paysafe acquired the online payments business and substantially all of the assets of 7012985 Canada Inc., which included Optimal Payments Inc. (‘‘OPI’’). OPI, directly or through its subsidiaries, had offered two alternatives for processing transactions which was used for the US online gambling market – ‘‘straight-through’’ processing (pursuant to which the customer deposited funds directly with the merchant) and ‘‘stored-value’’ e- wallet services, branded under the name ‘‘FirePay’’ Both the ‘‘straight-through’’ and ‘‘e- Wallet’’ options allowed for credit-card or ACH methods of funding. Upon enactment of the UIGEA on 13 October 2006, OPI immediately ceased all US gambling-related deposits and arranged the return of all funds that it was holding on behalf of US customers. 11.9 In October 2009, Optimal Payments Group Inc. (‘‘OGI’’) (the parent of OPI throughout the relevant period) negotiated a non-prosecution agreement (‘‘NPA’’) with the USAO. OGI agreed to a forfeiture of $19,182,418.18 and to cooperate with any further requests for information or assistance that the USAO may make. To the Directors’ knowledge, none has been forthcoming. OGI also agreed to refrain from providing payment processing services for gambling merchants in connection with US customers ‘‘in violation of the law of the United States or the law of any jurisdiction within the United States.’’ 11.10 OGI sold the assets of the payment businesses and rights to use of the Optimal Payments name in 2008 to 7012985 Canada Inc. Because the transaction was an asset purchase, all obligations under the NPA remain with OGI. Nonetheless, Paysafe (and, before it, Optimal Payments Inc., the entity that acquired the OGI payments assets and right to use the Optimal Payments name) has continued to abide by the restriction on US gambling-related processing activities.

Paysafe Group’s Current US Business 11.11 Some States (New Jersey, Delaware and Nevada) in the US have recently introduced regulations permitting processing of payments related to regulated online gambling. 11.12 None of those jurisdictions requires licensing of payment processors that perform the services Paysafe provides. In New Jersey, Paysafe is required to register as a vendor with the New Jersey Division of Gaming Enforcement (the ‘‘Division’’). It has done so and been determined suitable by that Division. The Delaware Lottery Commission has conﬁrmed that Paysafe is compliant with all Delaware Lottery regulations and that a licence is not required. No licensing or registration is required in Nevada. Paysafe has corresponded with the Nevada Gaming Control Board (the ‘‘NGCB’’) and so far as the Directors are aware NGCB has not objected to Paysafe’s provision of services in that state. 11.13 The Paysafe Group provides gateway services to several licensed operators in the regulated states, including Caesars, Tropicana and Resorts. Brands operating under these operators include wsop.com, 888.com, resortcasino.com and tropicanacasino.com. In 2014, Paysafe launched a Net+ prepaid card stored value product for the US market which can be used for online gambling. Paysafe has obtained money transmission licences in New Jersey, Delaware, Idaho, North Dakota and Iowa; however, for purposes of the Net+ prepaid card product it has contracted with a reputable third party such that no licence is currently needed.

87 11.14 Prior to Completion, the Skrill Group completed an intra-group restructuring to transfer Skrill USA Inc. outside the Skrill Group to Sentinel Group Holdings S.A. Paysafe has commenced the process for obtaining the required approvals in connection with Skrill USA Inc.’s money transmitter licences from the relevant US states or territories in order for the Paysafe Group to be able to acquire Skrill USA Inc. and has started to receive regulatory approvals from some of the relevant US states and territories. The transfer of Skrill USA Inc. to Sentinel Group Holdings S.A. was carried out at market value and the consideration (which is e5.2 million) was left outstanding as a loan between Skrill Holdings Limited and Sentinel Group Holdings S.A. In addition, Skrill Holding Limited has also provided Skrill USA Inc. with a funding loan for working capital purposes. Assuming that the required approvals are received in a timely fashion, Skrill Holdings Limited will repurchase Skrill USA Inc. on receipt of the relevant approvals and the consideration for that transfer will be the release of Sentinel Group Holdings S.A.’s obligation to repay the e5.2 million loan owed to Skrill Holdings Limited (and therefore Skrill Holdings Limited will not be required to raise any funds to ﬁnance the acquisition). 11.15 Sentinel Group Holdings S.A. has agreed that it will not sell Skrill USA Inc. to a third party for a period of six months after Completion. If Skrill Holdings Limited has not obtained the relevant approvals to enable Skrill USA Inc. to be transferred to Skrill Holdings Limited within the six month period following Completion, Sentinel Group Holdings S.A. shall be permitted to sell Skrill USA Inc. to a third party. In the event Skrill USA Inc. is sold to a third party, Sentinel Group Holdings S.A. will use reasonable endeavours to sell Skrill USA Inc. for the best possible purchase price, and the proceeds of that sale shall be used to repay the loans put in place between Skrill Holdings Limited and both Sentinel Group Holdings S.A. and Skrill USA Inc., and any excess loan amount that remains outstanding (whether relating to the working capital loan or the consideration for the transfer of Skrill USA Inc.) shall be waived by Skrill Holdings Limited. If Skrill USA Inc. is sold to a third party, the Paysafe Group intends to commence applying for its own money transmitter licences in the US in order to enable it to process payments in the US. The Paysafe Group has already obtained money transmitter licences in New Jersey, Delaware, Iowa, North Dakota and Idaho. 11.16 There are some US States that are considering licensing online gambling. Until and unless those states authorise online gambling (or a federal law is enacted permitting such activity), Paysafe Group will not process online gambling related transactions in those jurisdictions.

88 PART III

OPERATING AND FINANCIAL REVIEW OF THE PAYSAFE GROUP

SECTION A: OPERATING AND FINANCIAL REVIEW OF THE PAYSAFE GROUP FOR THE SIX MONTH PERIOD ENDED 30 JUNE 2015 SECTION B: OPERATING AND FINANCIAL REVIEW OF THE PAYSAFE GROUP FOR THE THREE YEARS ENDED 31 DECEMBER 2014

89 SECTION A: OPERATING AND FINANCIAL REVIEW OF THE PAYSAFE GROUP FOR THE SIX MONTH PERIOD ENDED 30 JUNE 2015

The following is a discussion of the Paysafe Group’s ﬁnancial condition and results of operations for the six month period ended and as at 30 June 2015. This discussion should be read in conjunction with Section B of Part III (Financial Information of the Paysafe Group) of this document. The audited consolidated ﬁnancial statements and related notes for the Paysafe Group for the six months ended and as at 30 June 2015 have been prepared in accordance with IFRS as adopted for use in the EU.

The following discussion and elsewhere in this document includes forward-looking statements that reﬂect the Paysafe Group’s plans, estimates and beliefs, and involve risks and uncertainties. Actual results and the timing of events could differ materially from those expressed or implied by such forward looking statements as a result of various factors, particularly those discussed in the section entitled ‘‘Risk Factors’’ and the paragraph relating to forward-looking statements in the section entitled ‘‘Important Information’’.

1. OVERVIEW The Paysafe Group had a strong performance across its businesses in the first half of 2015 with revenues increasing 40.2 per cent. to US$223.0 million (H1 2014: US$159.1 million) and adjusted EBITDA increasing 27.9 per cent. to US$49.9 million (H1 2014: US$39.0 million). This resulted in a 18.7 per cent. increase in the Paysafe Group’s adjusted profit after tax to US$37.3 million (H1 2014: US$31.4 million). Profit after tax was reduced to US$2.4 million (H1 2014: US$27.5 million), principally due to restructuring costs of US$4.1 million and acquisition costs of US$12.4 million relating to the Skrill Acquisition.

The Paysafe Group continued to deliver on a number of the Paysafe Group’s key objectives, notably the integration of the US businesses the Paysafe Group acquired in 2014, which have significantly contributed to the growth of the Paysafe Group, and more recently the completion of the acquisition of Skrill which the Paysafe Group believes will transform the business on a number of levels. In addition, in May 2015 the Paysafe Group acquired the FANS business, which has the potential to significantly enhance the Paysafe Group’s mobile offering and capability. The Paysafe Group has seen a continued diversification of its merchants away from the online gambling sector in H1 2015. The Paysafe Group has made good progress in the acquiring and issuing services divisions, which the Paysafe Group believes will contribute to continued growth and diversification of revenue through time. These developments are consistent with the Paysafe Group’s strategic goals and the Paysafe Group believes that the investment in these and other areas will help to drive further growth.

The Paysafe Group’s Largest Merchant represented 29.0 per cent. of total fee revenue in H1 2015 across all reportable segments and geographies. Revenues from the Largest Merchant as a percentage of total fee revenue decreased in H1 2015 while in H1 2014, they represented 46.8 per cent. of total revenue due to an uplift as a result of the FIFA World Cup. This decrease in H1 2015 primarily resulted from the addition of revenues from the Paysafe Group’s US Acquisitions.

The Paysafe Group provides services to the Largest Merchant worldwide, although a majority of revenue is derived from the Largest Merchant’s activities in Asia. Please see paragraph 5.33 of Part I (Information on the Paysafe Group) of this document for a detailed overview of the Paysafe Group’s Asia Gateway service. Although the regulatory environment has continued to evolve and while this did not materially impact the Company’s revenues in H1 2015, some uncertainty persists in the regulatory environment of online gambling.

The Paysafe Group derived approximately 46.2 per cent. of its revenue in H1 2015 from online gambling merchants with 53.7 per cent. from non-gambling merchants across a number of sectors, particularly within the NETBANX STP division. This resulted from the incorporation of the portfolio of non-gambling merchants of Meritus in 2014. The US Acquisitions have also balanced the Paysafe Group’s geographic concentration with 43.2 per cent. of revenue generated now in North America in H1 2015, 32.7 per cent. in Asia and 24 per cent. in the rest of the world.

90 NETELLER Stored Value (‘‘SV’’) The NETELLER SV business (comprising the NETELLER and Net+ prepaid card stored value offering) continued to perform well in H1 2015, despite the weakening of the Euro to the USD, with revenues up 20.1 per cent. to US$49.8 million (H1 2014: US$41.4 million) and a gross margin of 87.3 per cent. with underlying growth due to a continued increase in member sign-ups and increase in Net+ prepaid card user activity. The card issuing services division (launched at the end of 2014) offers a variety of different programmes, from white labelled cards to fully customised prepaid and multi-channel payment solutions, thereby leveraging the Paysafe Group’s extensive experience in multi-currency issuance and settlement to create repeatable scalable processes to merchants. The Paysafe Group has recently announced its partnership with Revolut for the Launch of an Innovative Currency Exchange Solution. The Paysafe Group delivers multi-currency, globally-accepted MasterCard enabling Revolut’s customers to access their funds using either a virtual or physical card. The Paysafe Group’s Net+ product continues to grow with an average of 10,000 physical cards and 63,000 virtual cards issued each March during H1 2015, and an average of 73,000 cardholders active every month during that period. NETELLERGO!, which allows e-commerce merchants to offer their consumers the ﬂexibility of access to indemniﬁed alternative payment types to complete their purchases, has also been well received.

NETBANX Straight Through Processing (‘‘STP’’) The NETBANX STP business showed strong growth overall in H1 2015 with revenue up 47.4 per cent. to US$173.0 million (H1 2014: US$117.4 million). The increase was primarily attributable to the addition of Meritus and GMA, which were acquired in July 2014, along with strong growth from existing gambling and non-gambling merchants. The gross margin fell to 37.1 per cent. (from 43.1 per cent. in H1 2014) incorporating the comparatively lower gross margin of the fast growing US businesses with the bulk of direct processing costs being fees to acquiring banks and other intermediate processors. Principal Membership with Visa and MasterCard has enabled the Paysafe Group to offer competitive acquiring services to merchants in the European Union. In addition, the Paysafe Group has the tools to enable merchants to access alternative payment types such as Apple Pay, MasterPass and Pingit to enhance the shopping experience for their customers using the most secure payment solutions available.

Meritus, GMA and FANS Acquisitions In July 2014, the Paysafe Group acquired Meritus Payment Solutions, a payments processing entity based in California, for a cash and share consideration of US$210 million, and GMA, a US-based online payments company, for up to US$15 million in cash. Meritus and GMA have contributed to the Paysafe Group’s ﬁnancial results in H1 2015, whereas they were not included in the H1 2014 ﬁnancial results. In addition to Meritus and GMA, in May 2015 the Paysafe Group acquired the Montreal based mobile platform developer FANS for a share consideration of approximately US$13 million. FANS’ proven technology platform provides the Paysafe Group with a white label, multi-level mobile wallet system including software to identify and analyse users based on their mobile behaviour.

Recent developments – Skrill Acquisition The principal focus of the Paysafe Group’s corporate activity in H1 2015 was the acquisition of Skrill for a total consideration of e1.1bn (US$1.2 billion), which completed on 10 August 2015 and its associated funding. See paragraph 14 of Part XI (Additional Information) of this document for a summary of the Skrill Acquisition. Management has continued to plan the integration of Skrill into the Paysafe Group with a dedicated internal team addressing all aspects of combining the two Paysafe Groups and focusing in particular on the combination of Skrill’s Stored Value businesses with NETELLER. Skrill acquired Ukash, a pre-paid e-money payment provider, on 31 March 2015. Ukash has been merged into the paysafecard business.

91 Management expects these acquisitions to significantly enhance the Paysafe Group’s product offerings and the scale and market presence of the enlarged Paysafe Group in addition to the benefit of customer and geographic diversification.

1.1 Results of Operations – six months ended 30 June 2015 compared to six months ended 30 June 2014 The following table shows the Paysafe Group’s reported on consolidated statement of comprehensive income for the six month periods ended 30 June 2015 and 30 June 2014. Six months Six months ended ended 30 June 2015 30 June 2014 US$ US$ (reported on) (reported on)

Revenue STP fees 173,033,711 117,355,497 Stored Value fees 49,756,862 41,426,120 Investment income 232,399 274,002

223,022,972 159,055,619

Cost of Sales STP expenses 108,782,499 66,769,565 Stored Value expenses 6,317,198 5,447,362

115,099,697 72,216,927

Gross proﬁt (Note 20) 107,923,275 86,838,692

Gross margin STP (%) 37.1% 43.1% Gross margin Stored Value (%) 87.3% 86.9% Gross margin Total (%) 48.3% 54.6% Non Fee Expenses Salaries and employee expenses 34,708,699 24,466,661 Technology and software 11,002,590 10,643,223 Premises and ofﬁce costs 5,762,071 4,550,183 Professional fees 2,395,729 2,015,675 Marketing and promotions 9,205,585 7,020,778 Travel and entertainment 1,739,340 1,572,375 Bank charges 351,877 334,628 Depreciation and amortisation (Note 6 and 7) 14,784,369 7,269,757 Acquisition costs (Notes 25 and 30) 12,377,267 1,521,355 Restructuring costs (Note 22) 4,133,813 — Foreign exchange loss / (gain) 5,788,670 (94,502) Net fair value gain on share consideration payable (1,610,000) — Loss on disposal of assets — 6,632

Results from operating activities 7,283,265 27,531,927 Finance costs 2,691,125 9,036

Proﬁt for the period before tax 4,592,140 27,522,891 Income tax expense 2,183,515 38,282

Profit for the period after tax attributable to owners of the Paysafe Group 2,408,625 27,484,609 Other comprehensive income items that are or may be reclassified subsequently to profit or loss Foreign currency translation differences for foreign operations, net of income tax (137,691) 49,528 Total comprehensive income for the period attributable to owners of the Paysafe Group 2,270,934 27,534,137

Basic earnings per share US$0.01 US$0.10

Fully diluted earnings per share US$0.01 US$0.10

92 (a) Revenue NETBANX STP fees The Paysafe Group’s revenue from NETBANX STP fees increased by 47.4 per cent. to US$173.0 million (H1 2014: US$117.4 million), with underlying growth of 20.5 per cent. on an organic constant currency basis excluding the Largest Merchant’s revenue. This growth also was enhanced by the integration of the Meritus and GMA businesses into the NETBANX STP division, with both businesses trading strongly.

NETELLER Stored Value fees The Paysafe Group’s revenue from NETELLER Stored Value fees increased by 20.1 per cent. to US$49.8 million (H1 2014: US$41.4 million), with underlying growth of 34.6 per cent. on a constant currency basis. This growth primarily was attributable to a continued increase in member sign-ups and an increase in Net+ prepaid card user activity.

Investment Income The Paysafe Group’s investment income decreased US$0.1 million to US$0.2 million (H1 2014: US$0.3 million). This decrease primarily was attributable to lower yields offered by banks on funds held in the Group’s segregated bank accounts.

(b) Cost of Sales NETBANX STP cost of sales The Paysafe Group’s STP cost of sales increased US$42.0 million, or 63 per cent., to US$108.8 million (H1 2014: US$66.8 million). This increase primarily was attributable to the increase in STP fees earned over the same period, as STP expenses vary directly in line with processing volumes, which drive both the fees and cost of sales. In addition, the increase in cost of sales reﬂected the lower gross margin of the NETBANX US businesses, with the bulk of direct processing costs being fees to acquiring banks and other intermediate processors.

NETELLER Stored Value cost of sales The Paysafe Group’s Stored Value cost of sales increased US$0.9 million, or 17 per cent., to US$6.3 million (H1 2014: US$5.4 million). This increase primarily was attributable to increased volumes processed within NETELLER as a result of member and merchant activity, as evidenced in the increased in NETELLER Stored Value fees earned in this period. In addition, with the growth in customer signups, there were ‘‘stepped’’ costs of additional headcount in the call centre and risk departments, and marketing and promotion fees where VIP loyalty ‘‘cash back’’ costs vary in line with VIP revenues.

(c) Gross Proﬁt The Paysafe Group’s gross proﬁt increased US$21.1 million, or 24 per cent., to US$107.9 million (H1 2014: US$86.8 million). This increase primarily was attributable to increased fees from both business lines, and the integration of the Meritus and GMA businesses into the NETBANX STP division.

(d) Non-fee expenses The Paysafe Group’s total non-fee expenses increased US$14.6 million, or 29 per cent., to US$65.2 million (H1 2014: US$50.6 million). This increase was largely driven by the Paysafe Group’s US acquisitions. Salaries and employee expenses, excluding share option expenses, increased by US$5.9 million, reﬂecting an increase in employee headcount of 186 employees to 741 full-time employees. This was largely attributable to increases in headcount in North America from the FANS, GMA and Meritus acquisitions, and employee additions to strengthen the Paysafe Group’s ﬁnance, operations, risk and compliance divisions. Share option expenses were US$7.1 million (H1 2014: US$2.8 million), relating to share based payment transactions on the Paysafe Group’s LTIP and share options allocated to the management team and other employees.

93 A foreign exchange loss of US$5.8 million was incurred (H1 2014: gain of US$0.1 million) due primarily to the unrealised loss recognised on forward exchange contracts entered into to hedge the Paysafe Group’s exposure to currency ﬂuctuations on the cash raised in the Paysafe Group’s rights offering versus the cash consideration payable for the Skrill Acquisition. Acquisition and restructuring costs were US$16.5 million (H1 2014: US$1.5 million), relating primarily to the Skrill Acquisition. Depreciation and amortisation was US$14.8 million (H1 2014: US$7.3 million), which included US$12.0 million of amortisation of intangible assets (H1 2014: US$4.8 million) and US$2.8 million of depreciation of capital assets (H1 2014: US$2.5 million). Approximately US$8.2 million of the depreciation and amortisation charge related to assets acquired through business acquisitions since 2011 (H1 2014: US$1.6 million). The NETELLER Stored Value platform was launched at the end of 2010 and is being amortised over ﬁve years on a straight line basis. Finance costs were US$2.7 million (H1 2014: US$0.0 million), due to the interest expense on debt incurred to fund the US Acquisitions in July 2014.

(e) Proﬁt before tax The Paysafe Group’s proﬁt before tax decreased by US$22.9 million, or 83 per cent. This decrease primarily was attributable to non-recurring restructuring costs of US$4.1 million and acquisition costs of US$12.4 million relating to the Skrill Acquisition.

(f) Proﬁt after tax The Paysafe Group earns income and pays tax principally in Canada, the US, the UK and the Isle of Man. The tax charge in H1 2015 was US$2.2 million (H1 2014: US$0.04 million). The provision for income taxes at US$3.5 million (H1 2014: US$4.0 million) included US$4.0 million in relation to Canadian withholding taxes that were deemed to have arisen on the relocation of assets to the Isle of Man from Canada in the 2004 and 2005 tax years. Following a seven-year investigation, the Canadian Revenue Agency claimed that additional withholding taxes were payable by the Paysafe Group. The provision in place at the beginning of 2015 has not been increased as the Paysafe Group believes that the existing provision represents the amount that the Paysafe Group will likely be required to pay in respect of such withholding taxes and interest. Without this provision, the Paysafe Group’s income tax asset as at 30 June 2015 would have been US$0.5 million.

(g) Total comprehensive proﬁt The Paysafe Group’s total comprehensive proﬁt decreased by US$25.2 million, or 92 per cent. This decrease primarily was attributable to non-recurring restructuring costs of US$4.1 million and acquisition costs of US$12.4 million relating to the Skrill Acquisition.

(h) Adjusted EBITDA Adjusted EBITDA increased 27.9 per cent. to US$49.9 million (H1 2014: US$39.0 million) adjusted for exceptional non-recurring items. The first half of 2015 was impacted by exceptional items including expenses related to acquisitions and foreign exchange movements. The adjusted EBITDA margin at 22.4 per cent. (H1 2014: 24.5 per cent.) was slightly lower due to the incorporation of the high growth lower margin US businesses which impacted the mix overall. Adjusted EBITDA is defined as results of operating activities before depreciation and amortisation and exceptional non-recurring items, which are defined as items of income and expense of such size, nature or incidence, that in the view of management their disclosure is relevant to explain the performance of the Group for the period.

94 Adjusted EBITDA is not a ﬁnancial measure calculated in accordance with IFRS as adopted by the EU. The presentation on these ﬁnancial measures may not be comparable to similarly titled measures reported by other companies due to the differences in the ways the measures are calculated. Six months Six months ended ended 30 June 30 June 2015 2014 (reported (reported on) on)

US$ Proﬁt before provision for income taxes 4,592,140 27,522,891 Depreciation and amortisation 14,784,369 7,269,757 Finance costs 2,691,125 9,036 Share option expense (Note 21) 7,094,621 2,756,833 Foreign exchange loss / (gain) 5,788,670 (94,502) Loss on disposal of assets — 6,632 Acquisition costs 12,377,267 1,521,355 Restructuring costs (Note 23) 4,133,813 — Net fair value gain on share consideration payable (1,610,000) —

Adjusted EBITDA 49,852,005 38,992,002

(i) Earnings per share The growth in revenue and adjusted EBITDA resulted in an increase of adjusted diluted EPS of 11.4 per cent. to US$0.12 (H1 2014: US$0.11) as compared to statutory fully diluted EPS which was US$0.01 (H1 2014: US$0.10). Adjusted diluted EPS is calculated based on adjusted profit after tax, reconciliation to unadjusted earnings is shown below. The weighted average number of shares in issue has been adjusted to exclude the impact of the rights issue (completed in May 2015) to finance the Skrill Acquisition which completed on 10 August 2015. Adjusted profit after tax and adjusted diluted EPS are not financial measures calculated in accordance with IFRS as adopted by the EU. The presentation of these financial measures may not be comparable to similarly titled measures reported by other companies due to the differences in the ways the measures are calculated. Six months Six months ended ended 30 June 30 June 2015 2014 (reported (reported on) on)

(US$m) Reported proﬁt before tax 4.6 27.5 FX gains (losses) 5.8 (0.1) Acquisition, restructuring and other exceptional costs 16.5 1.5 Share based payments 7.1 2.8 Fair value gains on share consideration payable (1.6) — Amortisation on acquired intangibles 8.2 1.6

Adjusted proﬁt before tax 40.6 33.3 Adjusted tax (3.3) (1.9)

Adjusted proﬁt after tax 37.3 31.4

Adjusted diluted EPS US$0.12 US$0.11

Adjusted weighted average of shares in issue – diluted (million) 306.5 287.5

95 2. LIQUIDITY AND CAPITAL RESOURCES 2.1 General The Paysafe Group’s liquidity requirements arise principally from its working capital requirements and capital expenditure. The Company’s obligations for these requirements are met by the cash generated from operations and the Company typically benefits from very low levels of indebtedness. The Paysafe Group intends to continue to finance its working capital and capital expenditures and any future acquisitions with a combination of cash flows from operations and debt facilities. As at 30 June 2015, the Paysafe Group had current financial debt of US$20.3 million, non-current financial debt of US$97.2 million and total cash of US$798.6 million of which US$685.3 million relates to cash raised by the rights issue to fund the Skrill Acquisition, resulting in net financial funds of US$689.5 million. As at 30 June 2015, the Paysafe Group had a committed term credit facility of US$100 million and a committed revolving credit facility of US$50 million, of which as of that date US$37 million was drawn under the term facility and US$80 million was drawn under the revolving facility. The term facility is repayable in quarterly instalments of US$5 million each, and both the term and revolving facilities are repayable on maturity in July 2017. The Paysafe Group’s borrowings generally are not seasonal. The reporting of cash and cash equivalents has been adjusted in H1 2015 to include two new line items, settlement assets and cash held as reserves which are now separately disclosed in the financial statements to provide a more transparent analysis of the Paysafe Group’s cash position. As a result, cash and cash equivalents more accurately represents the cash that is in the Paysafe Group’s bank accounts and immediately available to the business. Cash held as reserves also includes processor and card scheme deposits that were previously disclosed in prepaid expenses and deposits. Restricted NETELLER merchant and member cash balances are the excess of funds held that the Paysafe Group is required to maintain in respect of the e-money issued to members and merchants over balances payable which are held in segregated accounts. Cash held as reserves represents the cash the Paysafe Group is required to deposit with counterparties, which would include acquiring partners and card schemes, in order to transact with these institutions. Settlement assets represent gross transaction cash at acquirers and processors which will be remitted to the Paysafe Group. There would ordinarily be a timing difference from the time that the transaction is confirmed to the remittance of these funds, the risk associated to this delay is managed via guarantees from banks and card issuers. Previously included in trade and other payables is a transient cash liability balance totalling US$35.5 million in H1 2015 (H1 2014: US$30.6 million) that relates to transactions processed via the NETBANX gateway operations and security deposits held from the Paysafe Group’s bureau merchants. This item is now disclosed in the Paysafe Group’s H1 2015 financial statements as a separate line item on the balance sheet, having previously being disclosed in the notes to the accounts; this represents gross transaction cash that has been received by the Paysafe Group but not yet forwarded to the merchant. The Paysafe Group’s total gross cash was US$113.3 million at 30 June 2015 (US$109.0 million at 31 December 2014), excluding cash raised by the rights issue of US$685.3 million to fund the acquisition of Skrill. This included cash and cash equivalents, plus restricted merchant cash balances and restricted member cash balances (the excess of qualifying liquid assets held in respect of e-money issued to members over member balances payable). The cash and cash equivalents balance at 30 June 2015 of US$798.6 million (US$109.9 million at 31 December 2014) represents the cash of the Paysafe Group. Included in cash and cash equivalents is US$685.3 million raised by the rights issue to fund the acquisition of Skrill.

96 2.2 Cash ﬂows The following table sets out summary cash ﬂow information of the Company for the periods indicated: Six months Six months ended ended 30 June 30 June 2015 2014 (reported (reported on) on)

(US$ million) Net cash generated by operating activities 38.9 16.3 Net cash generated by (consumed in) investing activities (21.2) (5.7) Net cash generated by (consumed in) ﬁnancing activities 647.8 (0.3) Net increase in cash and cash equivalents 665.5 10.3

Cash and cash equivalents at the beginning of the ﬁnancial period 109.9 129.3 Effect of movement in foreign exchange on cash and cash equivalents held 23.1 0.1 Translation of foreign operations 0.1 0.1

Cash and cash equivalents at the end of the ﬁnancial period 798.6 139.8

(a) Six months ended 30 June 2015 compared to six months ended 30 June 2014 Net cash generated by operating activities was US$38.9 million for H1 2015 an increase of US$22.6 million from the net cash generated by operating activities of US$16.3 million for H1 2014. The higher net cash generated by operating activities was enhanced by the integration of the highly cash-generative Meritus and GMA businesses. Net cash consumed in investing activities was US$21.2 million for H1 2015, an increase of US$15.5 million from the net cash consumed by investing activities of US$5.7 million for H1 2014. The higher net cash consumed in investing activities was a result of the increase in acquisition costs incurred during the period relating to the acquisition of Skrill. Net cash generated by ﬁnancing activities was US$647.8 million for H1 2015, an increase of US$648.1 million from the net cash used by ﬁnancing activities of US$0.3 million for H1 2014. The increase in cash generation was primarily attributable to the cash generated from the rights issue to fund the acquisition of Skrill.

2.3 Capitalisation and financial indebtedness (a) Capitalisation The following table sets out the capitalisation and financial indebtedness of Paysafe at 30 June 2015. Save in respect of the issue of the Skrill Consideration Shares, there has been no material change in the capitalisation of Paysafe since 30 June 2015 (see Part VIII (Capitalisation and Indebtedness) of this document) and there has been no material change in Paysafe’s financial indebtedness since 30 June 2015: As at 30 June 2015

(US$ million) Share capital 0.1 Share premium 748.2 Capital redemption reserve — Equity reserve on share option issuance 34.4 Translation reserve (1.1) Retained earnings 97.4

Total Equity 879.0

97 (b) Financial Indebtedness and Gross Indebtedness The following table sets out the gross ﬁnancial indebtedness of the Paysafe Group as at 30 June 2015. As at 30 June 2015

(reported on) (US$ million) Total current debt Guaranteed — Secured 20.3 Unguaranteed/Unsecured 5.0

25.3

Total non-current debt Guaranteed — Secured 97.2 Unguaranteed/Unsecured 2.1

99.3

Total gross indebtedness 124.6

The following table sets out the net ﬁnancial indebtedness as at 30 June 2015; As at 30 June 2015

(reported on) (US$ million) Cash and cash equivalents 798.6

Restricted NETELLER cash (net) 8.4

Current bank debt (20.0) Other current ﬁnancial debt (0.3)

Current ﬁnancial indebtedness (20.3)

Net current ﬁnancial funds 786.7 Non-current bank debt (97.0) Other non-current ﬁnancial debt (0.2)

Non-current ﬁnancial indebtedness (97.2)

Net ﬁnancial funds 689.5

(c) Credit Facilities As at 30 June 2015, the Paysafe Group’s credit facilities consisted of a US$100 million term loan facility and a US$50 million revolving loan facility, each maturing in July 2017, being the third anniversary following the US Acquisitions. The term loan facility was repayable in quarterly instalments of US$5 million with the balance due upon maturity. As at 30 June 2015, outstanding borrowings were US$80 million under the term loan facility and US$37 million under the revolving loan facility.

98 The Paysafe Group entered into the Credit Facilities in connection with the Skrill Acquisition. On 10 August 2015, the Paysafe Group borrowed e500,000,000 and US$85,000,000 (a revolving credit facility as yet undrawn) under the Credit Facilities. The proceeds borrowed under the Credit Facilities were used to repay the existing loan facilities described above and to partially fund the Skrill Acquisition. See paragraph 14 of Part XI (Additional Information) of this document for a description of the Credit Facilities.

2.4 Capital expenditures The Paysafe Group’s business is not capital intensive. For the periods under review, Paysafe’s capital expenditure has ranged from 3 per cent. to 5 per cent. of its total revenue. However, the Paysafe Group continuously plans capital expenditure for the development of its business, principally in respect of (i) capitalised development costs relating to product innovation, including capitalised software and development costs and the purchase of software licences and (ii) information technology and hardware. The following table sets out the Paysafe Group’s capital expenditures for the periods shown:

Six months ended 30 June

2015 2014

(reported on) (US$ millions) Purchase of intangible assets 3,309,250 2,463,493 Purchase of property, plant and equipment 3,740,731 2,905,328

Total capital expenditure 7,049,981 5,368,821

The increase in purchases of intangible assets and property, plant and equipment in H1 2015 was primarily attributed to additional capitalised development costs and data processing equipment relating to the platforms included in the acquired businesses of Meritus, GMA, and FANS, which were not included in the H1 2014 results. The Paysafe Group expects to fund future capital expenditure from its current cash and cash ﬂows from operating activities and from ﬁnancing offered from suppliers when terms are favourable.

2.5 Contractual commitments and off-balance sheet arrangements (a) Contractual commitments The following table summarises Paysafe’s contractual obligations, commercial commitments and principal payments scheduled as at 30 June 2015:

Payments due by period (reported on) (US$ millions)

Less than More than Contractual commitment Total 1 year 1-5 years 5 years

Debt obligations(1) 117.5 20.3 97.2 — Operating lease payments 2.5 0.9 1.2 0.4

Total 120 21.2 98.4 0.4

(1) Does not include contingent consideration of US$5 million payable to the vendors of GMA assets, and such payments are due in less than 1 year and are contingent on the occurrence of certain events.

(b) Off-balance sheet arrangements As at 30 June 2015, the Paysafe Group had no off-balance sheet arrangements, as deﬁned in accordance with IFRS.

99 3. CRITICAL ACCOUNTING POLICIES The preparation of financial statements requires management to make significant estimates and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses as well as the related disclosure, including contingent assets and liabilities. Critical accounting policies and estimates are those policies or estimates which are particularly significant in presenting the Paysafe Group’s results of operations and include those that involve complex and subjective judgments and the use of assumptions, some of which may be inherently uncertain or susceptible to change. The effect of these judgments and the assumptions we make could potentially result in materially different results from that which would otherwise occur using different judgments and assumptions. For a detailed discussion of the application of these and other accounting policies as well as related estimates and judgments, see note 1 and note 4 to the Paysafe Group’s audited consolidated financial statements for the year ended 31 December 2014 which is included on pages 184 and 185 of Part IX (Financial Information of the Optimal Payments Group) of the March 2015 Prospectus and incorporated by reference into this document.

4. QUALITATIVE AND QUANTITATIVE DISCLOSURES ABOUT MARKET RISK Please refer to note 24 to the Paysafe Group’s audited consolidated ﬁnancial statements for the year ended 31 December 2014 which is included on page 206 of Part IX (Financial Information of the Optimal Payments Group) of the March 2015 Prospectus and incorporated by reference into this document for a discussion of the Paysafe Group’s risk management, market segment risk, currency risks, capital risk, interest rate risk and liquidity risk.

100 SECTION B: OPERATING AND FINANCIAL REVIEW OF THE PAYSAFE GROUP FOR THE THREE YEARS ENDED 31 DECEMBER 2014

The discussion of the Paysafe Group’s financial condition and results of operations for the three years ended 31 December 2014 is set out on pages 160 to 176 of the March 2015 Prospectus and is incorporated by reference into this document. See Part XII (Information Incorporated by Reference) of this document for further details about information that has been incorporated by reference into this document. The discussion should be read in conjunction with the consolidated financial statements and the related notes for the Paysafe Group for the years ended and as at 31 December 2014, 2013 and 2012 which is set out on pages 177 to 218 of the March 2015 Prospectus and is incorporated by reference into this document. See Part XII (Information Incorporated by Reference) of this document for further details about information that has been incorporated by reference into this document. The consolidated financial statements and the related notes for the Paysafe Group for the years ended and as at 31 December 2014, 2013 and 2012 have been prepared in accordance with IFRS as adopted for use in the EU.

101 PART IV

FINANCIAL INFORMATION OF THE PAYSAFE GROUP

SECTION A: ACCOUNTANTS’ REPORT ON THE REPORTED ON FINANCIAL INFORMATION OF THE PAYSAFE GROUP FOR THE SIX MONTH PERIOD ENDED 30 JUNE 2015 SECTION B: REPORTED ON FINANCIAL INFORMATION OF THE PAYSAFE GROUP FOR THE SIX MONTH PERIOD ENDED 30 JUNE 2015 SECTION C: AUDITED FINANCIAL INFORMATION OF THE PAYSAFE GROUP FOR THE THREE YEARS ENDED 31 DECEMBER 2014 SECTION D: ACCOUNTANTS’ REPORT ON THE AUDITED FINANCIAL INFORMATION OF TK GLOBAL PARTNERS, LP (‘‘MERITUS’’) FOR THE THREE YEARS ENDED 31 DECEMBER 2014 SECTION E: AUDITED FINANCIAL INFORMATION OF TK GLOBAL PARTNERS, LP (‘‘MERITUS’’) FOR THE THREE YEARS ENDED 31 DECEMBER 2014

102 SECTION A: ACCOUNTANTS’ REPORT ON THE REPORTED ON FINANCIAL INFORMATION OF THE PAYSAFE GROUP FOR THE SIX MONTHS ENDED 30 JUNE 2015

The Directors Paysafe Group plc Audax House 6 Finch Road Douglas Isle of Man

18 December 2015

Dear Sirs

Paysafe Group plc We report on the financial information set out on pages 105 to 138 for the six months ended 30 June 2015. This financial information has been prepared for inclusion in the Prospectus dated 18 December 2015 of Paysafe Group plc on the basis of the accounting policies set out in notes 3 and 4. This report is required by Paragraph 20.1 of Annex 1 of the Prospectus Directive Regulation and is given for the purpose of complying with that paragraph and for no other purpose. We have not audited or reviewed the financial information for the 6 month period ended 30 June 2014 which has been included for comparative purposes only, and accordingly do not express an opinion thereon.

Responsibilities The Directors of Paysafe Group plc are responsible for preparing the ﬁnancial information on the basis of preparation set out in notes 3 and 4, and in accordance with International Financial Reporting Standards as adopted by the European Union. It is our responsibility to form an opinion on the ﬁnancial information and to report our opinion to you. Save for any responsibility arising under Prospectus Rules 5.5.3R(2)(f) to any person as and to the extent there provided, to the fullest extent permitted by law we do not assume any responsibility to any other person and will not accept any liability to any other person for any loss suffered by any such other person as a result of, arising out of, or in connection with this report or our statement, required by and given solely for the purposes of complying with paragraph 23.1 of Annex I of the Prospectus Directive Regulation, consenting to its inclusion in the Prospectus.

Basis of opinion We conducted our work in accordance with Standards for Investment Reporting issued by the Auditing Practices Board in the United Kingdom. Our work included an assessment of evidence relevant to the amounts and disclosures in the financial information. It also included an assessment of the significant estimates and judgments made by those responsible for the preparation of the financial information 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 we considered necessary in order to provide us with sufficient evidence to give reasonable assurance that the financial information is free from material misstatement whether caused by fraud or other irregularity or error.

Opinion on financial information In our opinion, the financial information gives, for the purposes of the Prospectus dated 18 December 2015, a true and fair view of the state of affairs of Paysafe Group plc as at the six months ended 30 June 2015 and of its profits, cash flows and changes in equity for the period then ended in accordance with the basis of preparation set out in notes 3 and 4, and in

103 accordance with International Financial Reporting Standards as adopted by the European Union as described in note 3.

Declaration For the purposes of Prospectus Rule 5.5.3R(2)(f) we are responsible for this report as part of the Prospectus and declare that we have taken all reasonable care to ensure that the information contained in this report is, to the best of our knowledge, in accordance with the facts and contains no omission likely to affect its import. This declaration is included in the Prospectus in compliance with paragraph 1.2 of Annex I of the Prospectus Directive Regulation.

Yours faithfully

KPMG Audit LLC

104 SECTION B: REPORTED ON FINANCIAL INFORMATION OF THE PAYSAFE GROUP FOR THE SIX MONTH PERIOD ENDED 30 JUNE 2015

Consolidated Interim Statement of Financial Position as at 30 June 2015 30 June 30 June 2015 2014 US$ US$

ASSETS Non-current assets Goodwill (Note 5) 208,714,292 205,339,002 Intangible assets (Note 6) 75,108,101 76,140,609 Property, plant & equipment (Note 7) 14,182,372 13,357,689

Total non-current assets 298,004,765 294,837,300

Current assets Prepaid expenses and deposits 4,752,181 5,285,561 Trade and other receivables 17,115,709 14,711,829 Cash held as reserves 8,922,879 8,757,914 Restricted NETELLER merchant cash (Note 8) 290,118 2,232,596 Restricted NETELLER member cash (Note 9) 8,083,567 6,543,680 Settlement assets 40,080,913 29,849,176 Cash and cash equivalents (Note 14) 798,562,168 109,892,558

Total current assets 877,807,535 177,273,314

Total assets 1,175,812,300 472,110,614

SHAREHOLDERS’ EQUITY AND LIABILITIES SHAREHOLDERS’ EQUITY Share capital (Note 10) 88,088 46,575 Share premium 748,245,447 86,934,889 Capital redemption reserve 147 147 Equity reserve on share option issuance (Note 11) 34,405,958 27,311,337 Translation reserve (Note 12) (1,106,252) (968,561) Retained earnings 97,404,983 94,996,358

Total shareholders’ equity 879,038,371 208,320,745

LIABILITIES Non-current liabilities Long-term debt (Note 13) 97,000,000 107,000,000 Share consideration payable 44,887,000 42,967,500 Contingent consideration (Note 26) 2,084,000 — Obligations under ﬁnance lease (Note 27) 192,488 204,808

Total non-current liabilities 144,163,488 150,172,308

Current liabilities Forward exchange contracts (Note 14) 28,940,000 — Current portion of long-term debt (Note 13) 20,000,000 20,000,000 Share consideration payable 18,142,959 14,322,500 Contingent consideration 5,000,000 5,000,000 NETELLER loyalty program liability (Note 15) 1,214,085 1,159,980 Provision for losses on NETBANX merchant accounts (Note 16) 1,183,480 1,183,492 Taxes payable (Note 17) 3,528,272 4,044,775 Obligations under ﬁnance lease (Note 27) 281,261 578,797 Trade and other payables (Note 18) 38,793,481 36,736,858 NETBANX merchant processing liabilities (Note 19) 35,526,903 30,591,159

Total current liabilities 152,610,441 113,617,561

Total Shareholders’ equity and liabilities 1,175,812,300 472,110,614

Accompanying notes form part of these consolidated ﬁnancial statements

105 Consolidated Interim Statement of Comprehensive Income For the six month period ended 30 June 2015 (Reported on) Six month Six month period period ended ended 30 June 30 June 2015 2014 US$ US$ Revenue Straight Through Processing fees 173,033,711 117,355,497 Stored Value fees 49,756,862 41,426,120 Investment income 232,399 274,002 223,022,972 159,055,619 Cost of Sales Straight Through Processing expenses 108,782,499 66,769,565 Stored Value expenses 6,317,198 5,447,362 115,099,697 72,216,927

Gross profit (Note 20) 107,923,275 86,838,692 Non Fee Expenses Salaries and employee expenses 34,708,699 24,466,661 Technology and software 11,002,590 10,643,223 Premises and office costs 5,762,071 4,550,183 Professional fees 2,395,729 2,015,675 Marketing and promotions 9,205,585 7,020,778 Travel and entertainment 1,739,340 1,572,375 Bank charges 351,877 334,628 Depreciation and amortisation (Notes 6 and 7) 14,784,369 7,269,757 Acquisition costs (Notes 26 and 31) 12,377,267 1,521,355 Restructuring costs (Note 23) 4,133,813 — Foreign exchange loss / (gain) (Note 14) 5,788,670 (94,502) Net fair value gain on share consideration payable (1,610,000) — Loss on disposal of assets — 6,632 Results from operating activities 7,283,265 27,531,927 Finance costs 2,691,125 9,036 Profit for the period before tax 4,592,140 27,522,891 Income tax expense 2,183,515 38,282 Profit for the period after tax attributable to owners of the Group 2,408,625 27,484,609 Other comprehensive income Items that are or may be reclassified subsequently to profit or loss Foreign currency translation differences for foreign operations, net of income tax (137,691) 49,528 Total comprehensive income for the period attributable to owners of the Group 2,270,934 27,534,137

Basic earnings per share $0.01 $0.10

Fully diluted earnings per share $0.01 $0.10

Accompanying notes form part of these consolidated interim ﬁnancial statements The directors consider that all results derive from continuing operations

106 Consolidated Interim Statement of Changes in Equity For the six month period ended 30 June 2015 (Reported on)

Accompanying notes form part of these consolidated interim ﬁnancial statements

107 Consolidated Interim Statement of Cash Flows For the six month period ended 30 June 2015 (Reported on) Six months Six months ended ended 30 June 30 June 2015 2014 $$

OPERATING ACTIVITIES Proﬁt for the period before tax 4,592,140 27,522,891 Adjustments for non-cash items: Depreciation and amortisation 14,841,747 7,368,658 Unrealised foreign exchange loss/(gain) 4,960,147 (312,605) Acquisition costs 12,377,267 1,521,355 Net fair value gain on share consideration payable (1,610,000) — Share option expense (Note 22) 7,094,621 2,756,833 Finance costs 2,691,125 (8,768) Loss on disposal of assets — 6,632

Operating cash ﬂows before movements in working capital and member and merchant funds 44,947,047 38,854,996 Increase in trade and other receivables (2,223,450) (492,023) Decrease/(increase) in prepaid expenses and deposits 547,497 (661,528) Increase/(decrease) in trade and other payables 1,871,280 (2,171,161) Increase in NETELLER loyalty program liability 54,105 333,153 Increase in provision for losses on merchant accounts (12) (60)

Cash ﬂows from operations before movements in member and merchant funds 45,196,467 35,863,377 Decrease in restricted NETELLER merchant cash 1,654,428 203,892 (Increase)/decrease in restricted NETELLER member cash (1,314,804) 1,557,532 Increase in settlement assets (9,300,952) (19,351,567) Increase in cash held as reserves (164,965) (892,008) Increase/(decrease) in Netbanx merchant processing liabilities 4,935,743 (169,488)

41,005,917 17,211,738 Taxes paid (2,125,606) (932,203)

Cash ﬂows from operating activities 38,880,311 16,279,535

INVESTING ACTIVITIES Purchase of property, plant & equipment (3,740,731) (2,905,328) Purchase of intangible assets (3,309,250) (2,463,493) Proceeds from disposal of property, plant & equipment — 3,279 Acquisition costs (13,283,389) (317,639) Business acquisitions (894,368) —

Cash ﬂows used in investing activities (21,227,738) (5,683,181)

FINANCING ACTIVITIES Equity issuance (Note 10) 660,104,031 295 Repayment of long-term debt (10,000,000) — Repayment of obligations under capital lease (315,726) (256,972) Finance costs (1,968,575) —

Cash ﬂows from/(used in) ﬁnancing activities 647,819,730 (256,677)

INCREASE IN CASH AND CASH EQUIVALENTS DURING THE PERIOD 665,472,303 10,339,677 EFFECT OF MOVEMENT IN FOREIGN EXCHANGE ON CASH AND CASH EQUIVALENTS 23,148,971 104,856 TRANSLATION OF FOREIGN OPERATIONS 48,336 49,528 CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD 109,892,558 129,289,923

CASH AND CASH EQUIVALENTS, END OF PERIOD 798,562,168 139,783,984

Accompanying notes form part of these consolidated interim ﬁnancial statements

108 Notes to the Consolidated Financial Statements for the period ended 30 June 2015 1. GENERAL INFORMATION NETELLER plc was a private company incorporated under the laws of the Isle of Man (‘‘IOM’’) on 31 October 2003 and was registered as a public company on 1 April 2004. NETELLER plc changed its name to NEOVIA Financial Plc on 17 November 2008. On 1 March 2011 NEOVIA Financial Plc changed its name to Optimal Payments plc. On 9 November 2015, Optimal Payments plc changed its name to Paysafe Group plc (the ‘‘Company’’). The principal activities of Paysafe and the Group are described in Note 2. The Group includes Paysafe and its wholly owned subsidiaries as set out under ‘‘Basis of consolidation’’ in Note 4 and ‘‘Investment in subsidiaries’’ in Note 28. At 30 June 2015, the Group had 741 employees (31 December 2014: 712 employees).

2. NATURE OF OPERATIONS The Group provides services to businesses and individuals to allow the processing of direct debit, electronic cheque and credit card payments. The Group processes direct debit, electronic cheque and credit card payments, principally for internet Merchants. Optimal Payments Limited, a wholly- owned subsidiary of Paysafe Group plc, is authorised by the United Kingdom’s Financial Conduct Authority under the Electronic Money Regulations 2011 (FRN:900015) for the issuing of electronic money and payment instruments. Optimal Payments Merchant Services Ltd. is licensed by the Financial Supervision Commission of the Isle of Man (Ref. 1357) to carry on money transmission services.

3. BASIS OF PREPARATION Statement of compliance The ﬁnancial statements have been prepared in accordance with applicable IOM law and International Financial Reporting Standards (‘‘IFRS’’) as adopted by the EU and the AIM rules of the London Stock Exchange. The consolidated ﬁnancial statements were authorised for issue by the Board of Directors on 18 December 2015.

Statement of going concern These consolidated ﬁnancial statements of Paysafe Group plc and its subsidiaries (together referred to as ‘‘the Group’’) have been prepared on the going concern basis. The directors have a reasonable expectation that the Group has adequate resources to continue in operational existence for the foreseeable future.

Use of estimates and judgements The preparation of the Group’s financial statements requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities and contingencies at the date of the Group’s financial statements, and revenue and expenses during the reporting period. Actual results could differ from those estimated. Significant estimates in the Group’s financial statements include depreciation and amortisation, impairment testing of long-lived assets, share based payments, share consideration payable, and income taxes. By their nature, these estimates and assumptions are subject to estimation uncertainty and the effect on the Group’s financial statements of changes in estimates in future periods could be significant.

Functional and presentation currency These consolidated ﬁnancial statements are presented in US dollars, which is the functional currency of the Company.

4. SIGNIFICANT ACCOUNTING POLICIES The accounting policies set out below have been applied consistently to all periods presented in these consolidated ﬁnancial statements, and have been applied consistently by Group entities. The following principal accounting policies have been applied:

109 Basis of consolidation The consolidated financial statements incorporate the financial statements of the Company and enterprises controlled by the Company (and its subsidiaries) as at the period end. Control is achieved where the Company has the power to govern the financial and operating policies of an investee enterprise so as to obtain benefits from its activities. The consolidated financial statements include the accounts of the Company and its principal wholly owned subsidiaries as identified in Note 28. All inter-company transactions and balances between Group enterprises are eliminated on consolidation. In the financial statements of the Company, investments in subsidiaries are stated at cost.

Cash and cash equivalents Cash equivalents are deﬁned as short-term, highly liquid investments that are readily convertible to known amounts of cash and which are subject to an insigniﬁcant risk of changes in value.

Settlement assets Settlement assets result from timing differences in the Group’s settlement process. These timing differences arise primarily as a result of settlement amounts due from ﬁnancial institutions and other payment processors. These amounts are typically funded to the Group within days from the transaction processing date.

Cash held as reserves The Group has agreements with various ﬁnancial institutions for the settlement of payment transactions. Under the terms of these agreements, the Group is required to maintain certain amounts as reserves, which may be applied against any amounts for which the ﬁnancial institutions would be entitled for reimbursement.

Intangible assets Intellectual property is recorded at cost and is amortised on a straight-line basis over its estimated useful life which is assessed to be three to five years. Other intangible assets, including customer relationships, trade names and non-compete agreements that are acquired by the group and have finite useful lives are recognised at fair value at the acquisition date (‘‘cost’’) and subsequently measured at cost less accumulated amortisation and any accumulated impairment losses. Amortisation is calculated using the straight-line method over the expected life of the intangible asset, which is three to five years. Website and platform development costs are recorded at cost and amortised over their estimated useful life using the declining-balance method at 30%.

Property, plant & equipment Land is not depreciated. Property, plant & equipment are recorded at cost and is depreciated over their estimated useful lives, using the declining-balance method, on the following basis: Communication equipment 20% Furniture and equipment 20% Computer equipment 30% Other assets are depreciated over their estimated useful lives, using the straight-line method, on the following basis: Computer software 2 years Building & Leasehold Improvements 4% and 10 years respectively The gain or loss arising on the disposal or retirement of an asset is determined as the difference between the sales proceeds and the carrying amount of the asset and is recognised in income.

Impairment The carrying amounts of the Group’s non-ﬁnancial assets are reviewed at each reporting date to determine whether there is any indication of impairment. If any such indication exists, then the asset’s recoverable amount is estimated. For goodwill and intangible assets that have indeﬁnite useful lives or that are not yet available for use, the recoverable amount is estimated each year at the same time. An impairment loss is recognised if the carrying amount of an asset or its related cash-generating unit (CGU) exceeds its estimated recoverable amounts.

110 The recoverable amount of an asset or CGU is the greater of its value in use and its fair value less costs to sell. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset or CGU. For the purpose of impairment testing, assets that cannot be tested individually are grouped together into the smallest group of assets that generates cash inflows from continuing use that are largely independent of the cash inflows of other assets or CGU. Subject to an operating segment ceiling test, for the purposes of goodwill impairment testing, CGUs to which goodwill has been allocated are aggregated so that the level at which impairment testing is performed reflects the lowest level at which goodwill is monitored for internal reporting purposes. Goodwill acquired in a business combination is allocated to groups of CGUs that are expected to benefit from synergies of the combination. The Group’s corporate assets do not generate separate cash inflows and are utilised by more than one CGU. Corporate assets are allocated to CGUs on a reasonable and consistent basis and tested for impairment as part of the testing of the CGU to which the corporate asset is allocated. Impairment losses are recognised in the Statement of Comprehensive Income. Impairment losses recognised in respect of CGUs are allocated first to reduce the carrying amount of any goodwill allocated to the CGU (group of CGUs), and then to reduce the carrying amounts of the other assets in the CGU (group of CGUs) on a pro rata basis. An impairment loss in respect of goodwill is not reversed. In respect of other assets, impairment losses recognised in prior periods are assessed at each reporting date for any indications that the loss has decreased or no longer exists. An impairment loss is reversed if there has been a change in estimates used to determine the recoverable amount. An impairment loss is reversed only to the extent that the asset’s carrying amount does not exceed the carrying amount that would have been determined, net of depreciation or amortisation, if no impairment loss has been recognised. The Group performs impairment tests at least annually or whenever events or changes in circumstances indicate that the goodwill and intangible assets that have indefinite useful lives or are not yet in use carrying values for a business unit may not be recoverable.

Goodwill Goodwill arising on consolidation represents the excess of the cost of acquisition over the Group’s interest in the fair value of the identiﬁable assets and liabilities of subsidiaries at the date of acquisition. Goodwill is recognised as an asset and reviewed for impairment at least annually and in the event of impairment indicators arising. Any impairment is recognised immediately in the Statement of Comprehensive Income and is not subsequently reversed. On disposal of a subsidiary, the attributable amount of goodwill is included in the determination of the proﬁt or loss on disposal.

Trade and other receivables Trade and other receivables, including receivables from Merchants, are stated at their amortised cost less impairment losses and doubtful accounts.

Financial liabilities The Group classifies its financial liabilities at fair value through profit or loss, and as other financial liabilities measured at amortised cost depending on the purpose for which the financial liabilities were acquired or incurred. Management determines the classification of its financial liabilities at the initial recognition. Share consideration payable meets the definition of a financial liability under IAS 32 and therefore classified as such. The fair value of share consideration is determined through single-factor Monte Carlo valuation model at reporting date. Movements in fair value at any one reporting date are measured through profit and loss. The Group’s other financial liabilities measured at amortised cost comprise ‘trade and other payables’ and ‘Long term-debt’ in the balance sheet. Trade and other payables are recognised initially at fair value and subsequently measured at amortised cost using the effective interest method. Long-term debt are recognised initially at fair value, net of transaction costs incurred. Borrowings are subsequently carried at amortised cost. Any difference between the proceeds (net of transaction costs) and the redemption value is recognised in the statement of comprehensive

111 income over the period of the Long-term debt using the effective interest method. Finance charges are accounted for on an accruals basis and charged to the statement of comprehensive income using the effective interest rate method. Trade and other payables and Long-term debt are classiﬁed as current liabilities if payment is due within one year or less. If not, they are presented as non-current liabilities.

Income tax Income tax expense comprises current and deferred tax. Current tax and deferred tax are recognised in the Statement of Comprehensive Income except to the extent that it relates to a business combination, or items recognised directly in equity or in other comprehensive income. Current tax is the expected tax payable or receivable on the taxable income or loss for the year, using tax rates enacted or substantively enacted at the reporting date, and any adjustment to tax payable in respect of previous years. The Group uses the balance sheet liability method of accounting for income taxes. Temporary differences arising from the difference between the tax basis of an asset or liability and its carrying amount on the balance sheet are used to calculate deferred tax assets or liabilities. Deferred tax assets or liabilities are calculated using tax rates anticipated to exist in the periods that the temporary differences are expected to reverse, based on the laws that have been enacted or substantively enacted by the reporting date. Deferred tax assets and liabilities are offset if there is a legally enforceable right to offset current tax liabilities and assets, and they relate to income taxes levied by the same tax authority on the same taxable entity, or on different tax entities, but they intend to settle current tax liabilities and assets on a net basis or their tax assets and liabilities will be realised simultaneously. A deferred tax asset is recognised for unused tax losses, tax credits and deductible temporary differences, to the extent that it is probable that future taxable proﬁts will be available against which they can be utilised. Deferred tax assets are reviewed at each reporting date and are reduced to the extent that it is no longer probable that the related tax beneﬁt will be realised.

Segment reporting An operating segment is a component of the Group that engages in business activities from which it may earn revenues and incur expenses, including revenues and expenses that relate to transactions with any of the Group’s other components. All operating segments’ operating results are reviewed regularly by the Group’s CEO to make decisions about resources to be allocated to the segment and assess its performance, and for which discrete ﬁnancial information is available.

Revenue recognition The Group is involved in transaction processing services. Revenues from transaction processing services are recognised at the time services are rendered. Member revenue is recognised either as a fee calculated as a percentage of funds processed or as a charge per transaction, pursuant to the respective Member agreements. Merchant revenue is recognised as a fee calculated as a percentage of funds processed or as a charge per transaction on behalf of merchants. Interest income is accrued on a monthly basis, by reference to the principal outstanding and at the effective interest rate applicable. The Company renders services to various subsidiaries within the Group including Franchise Rights and Platform Service Fees. Revenue from rendering of services is recognised in proﬁt or loss at the time the services are rendered.

Leases (a) Leased assets Assets held by the Group under leases which transfer to the Group substantially all of the risks and rewards of ownership are classified as finance leases. On initial recognition, the leased asset is measured at an amount equal to the lower of its fair value and the present value of the minimum lease payments. Subsequent to initial recognition, the asset is accounted for in accordance with the accounting policy applicable to that asset. Assets held under other leases are classified as operating leases and are not recognised in the Group’s statement of financial position.

112 (b) Lease payments Payments made under operating leases are recognised in the Statement of Comprehensive Income on a straight-line basis over the term of the lease. Minimum lease payments made under finance leases are apportioned between the finance expense and the reduction of the outstanding liability. The finance expense is allocated to each period during the lease term so as to produce a constant periodic rate of interest on the remaining balance of the liability.

Foreign exchange The individual financial statements of each Group entity are presented in the currency of the primary economic environment in which the entity operates (its functional currency). For the purpose of the consolidated financial statements, the results and financial position of each entity are expressed in US dollars, which is the functional currency of Paysafe Group plc, and the presentation currency for the consolidated financial statements. In preparing the financial statements of the individual entities, transactions in currencies other than the entity’s functional currency (foreign currencies) are recorded at the rates of exchange prevailing on the dates of the transactions. At each balance sheet date, monetary items denominated in foreign currencies are retranslated at the rates prevailing on the balance sheet date. Non-monetary items carried at fair value that are denominated in foreign currencies are retranslated at the rates prevailing on the date when the fair value was determined. Non-monetary items that are measured in terms of historical cost in a foreign currency are not retranslated. Exchange differences arising on the settlement of monetary items, and on the retranslation of monetary items, are included in profit or loss for the period. Exchange differences arising on the retranslation of non-monetary items carried at fair value are included in the Statement of Comprehensive Income for the period, except for differences arising on the retranslation of non- monetary items in respect of which gains and losses are recognised directly in equity. For such non-monetary items, any exchange component of that gain or loss is also recognised directly in equity. For the purpose of presenting consolidated financial statements, the assets and liabilities of the Group’s foreign operations (including comparatives) are expressed in United States dollars using exchange rates prevailing on the balance sheet date. Income and expense items (including comparatives) are translated at the average exchange rates for the period, unless exchange rates fluctuated significantly during that period, in which case the exchange rates at the dates of the transactions are used. Exchange differences arising, if any, are classified as equity and transferred to the Group’s translation reserve. Such translation differences are recognised in profit or loss in the period in which the foreign operation is disposed of. Goodwill and fair value adjustments arising on the acquisition of foreign operations are treated as assets and liabilities of the foreign operation and translated at the closing rate.

Related party transactions Monetary related party transactions in the normal course of operations are recorded at fair value, and transactions between related parties, not in the normal course of operations, are recorded at the carrying value as recorded by the transferor.

Foreign exchange contracts The Group uses foreign exchange contracts to reduce its exposure to adverse fluctuations in foreign exchange rates. These financial instruments are presented in the accompanying consolidated financial statements at fair value. Fair values are based on market quotes, current foreign exchange rates or management estimates, as appropriate, and gains and losses on the foreign exchange contracts are reflected in the consolidated income statement. The increase or decrease in the fair value of the contracts has been taken to income.

Research and development Research expenditure is written off to the income statement in the period in which it is incurred. Development expenditure is written off in the same way unless management is satisfied as to the technical, commercial and financial viability of the individual projects generating future economic benefits, and the Group intends to and has sufficient resources to complete development and to

113 use or sell the asset. In this situation, the expenditure is capitalised at cost, less a provision for any impairment in value, and is amortised on the commencement of use over the period in which beneﬁts are expected to be received by the Group. The expenditure capitalised includes the cost of materials, direct labour and overhead costs that are directly attributable to preparing the asset for its intended use.

Share-based payments The Company issues share options to certain employees, including Directors. Equity-settled share options are measured at fair value at the date of grant. In valuing equity-settled share options, no account is taken of any vesting conditions, other than conditions linked to the price of the shares of the Company (market conditions). The fair value determined at the grant date of the share option is expensed over the vesting period, which ends on the date on which the relevant employees become fully entitled to the award (the vesting date). The cumulative expense recognised for equity-settled share options at each reporting date reflects the extent to which the vesting period has expired and the Company’s best estimate of the number of equity instruments that will ultimately vest (or in the case of a market condition, be treated as vesting). The movement in cumulative expense since the previous reporting date is recognised in the income statement, with a corresponding entry in equity. No expense is recognised for awards that do not ultimately vest, except for awards where vesting is conditional upon a market vesting condition or a non-vesting condition, which are treated as vesting irrespective of whether or not the condition is satisfied, provided that all other non-market vesting conditions are satisfied. Where the terms of an equity-settled award are modified, the minimum expense recognised is the expense as if the terms had not been modified. An additional expense is recognised over the remainder of the new vesting period for the incremental fair value of the modification, based on the difference between the fair value of the original award and the fair value of the modified award, both as measured on the date of the modification. Where an equity-settled award is cancelled, it is treated as if it had vested on the date of cancellation, and any cost not yet recognised in the income statement for the award is expensed immediately. Any compensation paid up to the fair value of the award at the cancellation or settlement date is deducted from equity, with any excess over fair value being treated as an expense in the income statement. Where shares of the Company have been provided as consideration in business combinations, the fair value of the shares is determined using appropriate valuation methods applicable to the transaction.

Offsetting Financial assets and liabilities are set off and the net amount presented in the Statement of Financial Position when, and only when, the Group has a legal enforceable right to set off the amounts and intends either to settle on a net basis or to realise the asset and settle the liability simultaneously. Gross settlement is equivalent to net settlement if and only if the gross settlement mechanism has features that eliminate or result in insigniﬁcant credit and liquidity risk and processes receivables and payables in a single settlement cycle. The balances owing to the Members and merchants and the related cash balances segregated in the members and merchant’s accounts are presented net in the statement of ﬁnancial position as the Company considered these gross settlement as equivalent to net settlement in accordance with IAS 32. Income and expenses are presented on a net basis only when permitted by the accounting standards, or for gains and losses arising from a group of similar transactions such as in the Group’s trading activity.

Earnings per share The Group presents basic and diluted earnings per share (EPS) data for its ordinary shares. Basic EPS is calculated by dividing the proﬁt or loss attributable to ordinary shareholders of the Company by the weighted average number of ordinary shares outstanding during the period, adjusted for own shares held. Diluted EPS is determined by adjusting the proﬁt or loss attributable

114 to ordinary shareholders and the weighted average number of ordinary shares outstanding, adjusted for own shares held and for the effects of all dilutive potential ordinary shares, which comprise convertible notes and share options granted to employees.

Application of new and revised accounting policies In the current period, the Group has applied a number of amendments to IFRSs and a new Interpretation issued by the International Accounting Standards Board (‘‘IASB’’) that are mandatorily effective for an accounting period that begins on or after 1 July 2014. Annual Improvements to IFRSs – 2010-2012 Cycle IFRS 2 Share-based Payment IFRS 2 has been amended to clarify the definition of ‘vesting condition’ by separately defining ‘performance condition’ and ‘service condition.’ Changes to summarised below: For a condition to be a performance condition, it needs to meet both of the following criteria: (a) the counterparty has to complete a specified period of service – i.e. a service condition, which can be either explicit or implicit; and (b) the specified performance target(s) has to be met while the counterparty is rendering services. The period for achieving the performance target(s) cannot extend beyond the end of the service period, but it may start before the service period – provided that the commencement date of the performance target is not substantially before the commencement of the service period. As such, performance targets achieved after the requisite service period would not be accounted for as a performance condition, but would instead be accounted for as a non-vesting condition. A performance target needs to be defined with reference to the entity’s own operations or activities, or with reference to the price or value of the entity’s equity instruments. In this context, ‘entity’ includes entities in the same group. IFRS 3 Business Combinations These amendments clarify the classification and measurement of contingent consideration in a business combination. Changes to summarised below: (a) When contingent consideration is a financial instrument, its classification as a liability or equity is determined by reference to IAS 32 Financial Instruments: Presentation, rather than to any other IFRSs. (b) Contingent consideration that is classified as an asset or a liability is always subsequently measured at fair value, with changes in fair value recognised in profit or loss. Consequential amendments are also made to IAS 39 Financial Instruments: Recognition and Measurement and IFRS 9 Financial Instruments to prohibit contingent consideration from subsequently being measured at amortised cost. In addition, IAS 37 Provisions, Contingent Liabilities and Contingent Assets is amended to exclude provisions related to contingent consideration. IFRS 8 Operating Segmments IFRS 8 has been amended to explicitly require the disclosure of judgements made by management in applying the aggregation criteria. The disclosures were made as part of note 20 and include: (a) a brief description of the operating segments that have been aggregated; and (b) the economic indicators that have been assessed in determining that the operating segments share similar economic characteristics. In addition, this amendment clarifies that a reconciliation of the total of the reportable segments’ assets to the entity’s assets is required only if this information is regularly provided to the entity’s chief operating decision maker. This change aligns the disclosure requirements with those for segment liabilities. IFRS 13 Fair Value Measurement The IASB has clarified that, in issuing IFRS 13 and making consequential amendments to IAS 39 and IFRS 9, it did not intend to prevent entities from measuring short-term receivables and payables that have no stated interest rate at their invoiced amounts without discounting, if the effect of not discounting is immaterial.

115 IAS 24 Related Party Disclosures The deﬁnition of a ‘related party’ is extended to include a management entity that provides key management personnel (KMP) services to the reporting entity, either directly or through a group entity. For related party transactions that arise when KMP services are provided to a reporting entity, the reporting entity is required to separately disclose the amounts that it has recognised as an expense for those services that are provided by a management entity; however, it is not required to ‘look through’ the management entity and disclose compensation paid by the management entity to the individuals providing the KMP services. The reporting entity will also need to disclose other transactions with the management entity under the existing disclosure requirements of IAS 24 – e.g. loans. The application of these amendments has had no material impact on the disclosures in the Group’s consolidated ﬁnancial statements.

Future changes to accounting standards The Group has not applied the following new and revised IFRSs that have been issued but are not yet effective: IFRS 9 Financial Instruments The IASB issued IFRS 9 in November 2009, introducing new requirements for the classification and measurement of financial assets. IFRS 9 was subsequently amended in October 2010 to include requirements for the classification and measurement of financial liabilities and for derecognition, and in November 2013 to include the new requirements for general hedge accounting. Another revised version of IFRS 9 was issued in July 2014 mainly to include a) impairment requirements for financial assets and b) limited amendments to the classification and measurement requirements by introducing a ‘fair value through other comprehensive income’ (FVTOCI) measurement category for certain simple debt instruments. IFRS 9 is effective for annual periods beginning on or after 1 January 2018. It is not practicable to provide a reasonable estimate of the effect of IFRS 9 until the Group undertakes a detailed review. IFRS 15 Revenue from Contracts with Customers In May 2014, IFRS 15 was issued which establishes a single comprehensive model for entities to use in accounting for revenue arising from contracts with customers. IFRS 15 will supersede the current revenue recognition guidance including IAS 18 Revenue, IAS 11 Construction Contracts and the related Interpretations when it becomes effective for annual periods beginning on or after 1 January 2017. The core principle of IFRS 15 is that an entity should recognise revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. Specifically, the Standard introduces a 5-step approach to revenue recognition: * Step 1: Identify the contract(s) with a customer * Step 2: Identify the performance obligations in the contract * Step 3: Determine the transaction price * Step 4: Allocate the transaction price to the performance obligations in the contract * Step 5: Recognise revenue when (or as) the entity satisfies a performance obligation Extensive disclosures are required by IFRS 15. The directors of the Group do not anticipate that the application of IFRS 15 in the future will have a material impact on the amounts reported and disclosures made in the Group’s consolidated financial statements. However, it is not practicable to provide a reasonable estimate of the effect of IFRS 15 until the Group performs a detailed review. Amendments to IFRS 11 Accounting for Acquisitions of Interests in Joint Operations The amendments to IFRS 11 provide guidance on how to account for the acquisition of a joint operation that constitutes a business as defined in IFRS 3 Business Combinations. Specifically, the amendments state that the relevant principles on accounting for business combinations in IFRS 3 and other standards (e.g. IAS 36 Impairment of Assets regarding impairment testing of a cash generating unit to which goodwill on acquisition of a joint operation has been allocated) should be applied. The same requirements should be applied to the formation of a joint operation if and only

116 if an existing business is contributed to the joint operation by one of the parties that participate in the joint operation. A joint operator is also required to disclose the relevant information required by IFRS 3 and other standards for business combinations. The amendments to IFRS 11 apply prospectively for annual periods beginning on or after 1 January 2016. The directors of the Group do not anticipate that the application of these amendments to IFRS 11 will have a material impact on the Group’s consolidated financial statements. Amendments to IAS 16 Property, Plant and Equipment and IAS 38 Intangible Assets The amendments to IAS 16 prohibit entities from using a revenue-based depreciation method for items of property, plant and equipment. The amendments to IAS 38 introduce a rebuttable presumption that revenue is not an appropriate basis for amortisation of an intangible asset. The amendments apply prospectively for annual periods beginning on or after 1 January 2016. Currently, the Group uses the declining balance method for depreciation for its property, plant and equipment, and declining balance and straight line methods for amortisation for its intangible assets. The directors of the Group believe that these methods are the most appropriate method to reflect the consumption of economic benefits inherent in the respective assets and accordingly, the directors of the Group do not anticipate that the application of these amendments to IAS 16 and IAS 38 will have a material impact on the Group’s consolidated financial statements.

5. GOODWILL The Group had the following balances

GROUP US$

Cost Balance at 1 January 2014 30,492,122 Additions during the year 174,846,880

Balance at 31 December 2014 205,339,002 Additions during the period (Note 26) 3,375,290

Balance at 30 June 2015 208,714,292

Carrying amount As at 31 December 2014 205,339,002

Carrying amount As at 30 June 2015 208,714,292

The Group performs goodwill asset impairment tests at least annually or whenever events or changes in circumstances indicate that the goodwill carrying value for a business unit might not be recoverable. The recoverable amount is deﬁned as the higher of fair value less costs to sell and value in use.

117 Key assumptions used in the calculation of recoverable amounts are discount rates and EBITDA growth rate. The values assigned to the key assumptions represented management’s assessment of future trends in the e-commerce industry impacting the NETBANX straight-through processing business and were based on both external and internal sources (historical data). The key assumptions were as follows, and reﬂect a weighted average of this CGU comprising the respective operating divisions: Year ended 31December 2014 Weighted average (in percent) US$

Discount rate 5% Terminal value growth rate 1.35% Budgeted EBITDA growth rate (average 5 years) 5%

The discount rate is an estimate based on past experience and the expected average weighted average cost of capital. Five years of cash flows were included in the discounted cash flow model. A long-term growth rate into perpetuity was determined based on management’s estimate of the terminal value growth rate in EBITDA, which management believed was consistent with the assumption that a market participant would make. Budgeted EBITDA was based on expectation of future outcomes taking into account past experiences. No impairment indicators were identified during the six month period ended 30 June 2015.

6. INTANGIBLE ASSETS The Group had the following balances:

WEBSITE AND INTELLECTUAL PLATFORM CUSTOMER PROPERTY DEVELOPMENT RELATIONSHIPS NON-COMPETE TRADE NAME TOTAL $ $ $ $ $ $

Cost As at 31 December 2013 30,141,130 23,853,461 — — — 53,994,591 Additions 2,463 5,394,912 — — — 5,397,375 Acquisition 3,753,158 — 51,286,314 6,738,772 1,824,386 63,602,630 Exchange difference (915) — — — — (915)

As at 31 December 2014 33,895,836 29,248,373 51,286,314 6,738,772 1,824,386 122,993,681 Additions 69,852 3,239,398 — — — 3,309,250 Acquisition (Note 26) 7,700,000 — — — — 7,700,000 Exchange difference 165 — — — — 165

As at 30 June 2015 41,665,853 32,487,771 51,286,314 6,738,772 1,824,386 134,003,096

Accumulated amortization As at 31 December 2013 20,660,988 10,594,550 — — — 31,255,538 Charge for the year 4,949,947 5,235,495 4,494,446 738,185 159,879 15,577,952 Disposals — — — — — — Exchange difference 19,387 195 — — — 19,582

As at 31 December 2014 25,630,322 15,830,240 4,494,446 738,185 159,879 46,853,072 Charge for the period 2,852,830 3,035,523 5,128,632 402,408 622,377 12,041,770 Exchange difference 153 — — — — 153

As at 30 June 2015 28,483,305 18,865,763 9,623,078 1,140,593 782,256 58,894,995

Net book value As at 31 December 2014 8,265,514 13,418,133 46,791,868 6,000,587 1,664,507 76,140,609

Net book value As at 30 June 2015 13,182,548 13,622,008 41,663,236 5,598,179 1,042,130 75,108,101

Impairment Analysis The Board have determined that there has not been any indication of an impairment required in the current period.

118 7. PROPERTY, PLANT & EQUIPMENT The Group had the following balances:

BUILDING AND COMMUNICATION FURNITURE AND COMPUTER COMPUTER LEASEHOLD EQUIPMENT EQUIPMENT EQUIPMENT SOFTWARE IMPROVEMENTS TOTAL $ $ $ $ $ $

Cost As at 31 December 2013 201,524 2,403,151 11,423,536 15,024,032 2,500,644 31,552,887 Additions 132,443 876,411 2,101,084 2,431,089 156,285 5,697,312 Disposals (83,716) (1,312) — (835,798) — (920,826) Acquisition — 566,689 288,600 347,089 87,902 1,290,280 Exchange difference (6,156) (168,995) (378,473) (614,438) (148,017) (1,316,079)

As at 31 December 2014 244,095 3,675,944 13,434,747 16,351,974 2,596,814 36,303,574

As at 31 December 2014 244,095 3,675,944 13,434,747 16,351,974 2,596,814 36,303,574 Additions 137,359 77,036 2,341,522 1,166,792 18,022 3,740,731 Disposals — — — (95,705) — (95,705) Acquisition (Note 26) — 29,302 63,636 — 2,457 95,395 Exchange difference 4,985 (81,479) (284,798) (321,395) (100,175) (782,862)

As at 30 June 2015 386,439 3,700,803 15,555,107 17,101,666 2,517,118 39,261,133

Accumulated depreciation As at 31 December 2013 93,590 1,222,235 5,569,585 11,858,749 489,148 19,233,307 Charge for the year 104,723 1,182,645 1,041,395 2,607,223 570,899 5,506,885 Disposals (76,898) (1,108) — (830,541) — (908,547) Exchange Difference (3,429) (64,589) (256,189) (526,985) (34,568) (885,760)

As at 31 December 2014 117,986 2,339,183 6,354,791 13,108,446 1,025,479 22,945,885

As at 31 December 2014 117,986 2,339,183 6,354,791 13,108,446 1,025,479 22,945,885 Charge for the period 27,286 554,301 558,138 1,381,049 279,203 2,799,977 Disposals — — — (95,705) — (95,705) Acquisition (Note 26) — 3,031 21,805 — 594 25,430 Exchange Difference (1,608) (38,836) (212,396) (312,715) (31,271) (596,826)

As at 30 June 2015 143,664 2,857,679 6,722,338 14,081,075 1,274,005 25,078,761

Net book value As at 31 December 2014 126,109 1,336,761 7,079,956 3,243,528 1,571,335 13,357,689

Net book value As at 30 June 2015 242,775 843,124 8,832,769 3,020,591 1,243,113 14,182,372

In the six months ended 30 June 2015, $57,378 (2014: $98,901) of investment tax credits (ITCs) received were recorded against depreciation and amortisation expense since the assets giving rise to the ITCs were fully amortised.

8. RESTRICTED NETELLER MERCHANT CASH The Group maintains bank accounts with the Group’s principal bankers which are segregated from operating funds and which contain funds held on behalf of merchants, representing pooled merchant funds. Balances in the segregated accounts are maintained at a sufﬁcient level to fully offset amounts owing to the Group’s merchants. A legal right to offset exists between the balances owing to the merchants and the cash balances segregated in the client accounts. As such, only the net balance of surplus cash is disclosed on the Statement of Financial Position as Restricted NETELLER Merchant Cash.

119 The Group had the following balances:

As at As at 30 June 31 December 2015 2014 US$ US$

Segregated account funds 101,904,477 102,069,054 Payable to NETELLER Merchants (101,614,359) (99,836,458)

Restricted NETELLER Merchant Cash 290,118 2,232,596

9. RESTRICTED NETELLER MEMBER CASH In compliance with the Financial Conduct Authority (FCA) rules and regulations, the Group holds Qualifying Liquid Assets at least equal to the amounts owing to Members. These amounts are maintained in accounts which are segregated from operating funds. As a legal right to offset exists between the balances owing to the Members and the cash balances segregated in the member accounts, the prior year presentation in the Consolidated Statement of Financial Position has been updated and only the net balance of surplus cash is disclosed on the Consolidated Statement of Financial Position as Restricted NETELLER Member cash.

The Group had the following balances:

As at As at 30 June 31 December 2015 2014 US$ US$

Qualifying Liquid Assets held for NETELLER Members 160,122,048 143,639,792 Payable to NETELLER Members (152,038,481) (137,096,112)

Restricted NETELLER Member Cash 8,083,567 6,543,680

10. SHARE CAPITAL

As at As at 30 June 31 December 2015 2014 £ £

Authorised: 600,000,000 ordinary shares of £0.0001 per share (At 31 December 2014: 200,000,000 ordinary shares of £0.0001 per share) 60,000 20,000

1,000,000 deferred shares of £0.01 per share (At 31 December 2014: 1,000,000 deferred shares £0.01 per share) 10,000 10,000

Issued and fully paid 437,238,429 ordinary shares of £0.0001 per share (At 31 December 2014: 163,019,614 ordinary shares of £0.0001 per share) 70,088 28,575 1,000,000 deferred shares of £0.01 per share (At 31 December 2014: 1,000,000 deferred shares of £0.01 per share) 18,000 18,000

Total share capital 88,088 46,575

120 Holders of the ordinary shares are entitled to receive dividends and other distributions, to attend and vote at any general meeting, and to participate in all returns of capital on winding up or otherwise. Holders of the deferred shares are not entitled to vote at any annual general meeting of the Company and are only entitled to receive the amount paid up on the shares after the holders of the ordinary shares have received the sum of £1,000,000 for each ordinary share held by them and shall have no other right to participate in assets of the Company.

Issue of ordinary shares The Company raised total gross proceeds of approximately £463 million (approximately £436 million net of expenses of the Rights Issue) (approximately US$702 million and US$660 million respectively) through the issue of 272,495,506 new Ordinary Shares by way of the Rights Issue and the subsequent rump placing. Pursuant to the Rights Issue, 263,685,643 new Ordinary Shares were issued by way of rights to Qualifying Shareholders (other than, subject to certain exceptions, to Excluded Shareholders) to subscribe for new Ordinary Shares at an Offer Price of 166 pence per new Ordinary Share payable in full on acceptance by no later than 11.00 a.m. on 1 May 2015. The Offer Price represented: (a) a 34 per cent discount to the theoretical ex-rights price of an existing Ordinary Share, when calculated by reference to the volume weighted average price of 398 pence per existing Ordinary Share during the 5 day period between 16 March 2015 and 20 March 2015 (being the last practicable Business Day before the announcement of the Rights Issue); (b) a 36 per cent discount to the theoretical ex-rights price of an existing Ordinary Share, when calculated by reference to the closing price of 419 pence per existing Ordinary Share on 20 March 2015; and (c) a 60 per cent discount to the closing price of 419 pence per existing Ordinary Share on 20 March 2015. The Rights Issue was made on the basis of 5 new Ordinary Shares at 166 pence per new Ordinary Share for every 3 existing Ordinary Shares held by and registered in the name of each Qualifying Shareholder at 5.00 p.m. on the Record Date, and in proportion to any other number of existing Ordinary Shares each Qualifying Shareholder then holds. An additional 8,809,863 new Ordinary Shares were issued at a price of 290 pence per New Ordinary Share by way of a Rump Placing to subscribers for shares not validly taken up in the Rights Issue. Additionally, 1,382,412 Ordinary Shares were issued during the six months ended 30 June 2015 as a result of the exercise of vested options under the ESOS and LTIP plans (see Note 22). 303,097 Ordinary Shares were also issued during the six months ended 30 June 2015 as a result of the acquisition of FANS Entertainment Inc. (see Note 26)

11. EQUITY RESERVE ON SHARE OPTION ISSUANCE

As at As at 30 June 31 December 2015 2014 US$ US$

Balance at beginning of year 27,311,337 19,036,989 Share option expense (Note 22) 7,094,621 8,274,348

Balance at end of period 34,405,958 27,311,337

The equity reserve on share option issuance comprises the cost to the Company related to the equity-settled share-based payments transactions.

121 12. TRANSLATION RESERVE

As at As at 30 June 31 December 2015 2014 US$ US$

Balance at beginning of year (968,561) (1,851,482) Arising on translation of foreign operations (137,691) 882,921

Balance at end of period (1,106,252) (968,561)

Exchange differences relating to the translation from the functional currencies of the Group’s foreign subsidiaries into US dollars are brought to account by entries made directly to the foreign currency translation reserve.

13. LONG-TERM DEBT The Group had the following balances:

As at As at 30 June 31 December 2015 2014 US$ US$

Term facility 80,000,000 90,000,000 Revolving facility 37,000,000 37,000,000

117,000,000 127,000,000 Current portion 20,000,000 20,000,000

97,000,000 107,000,000

The Group’s credit facility of $150 million provided by Bank of Montreal consists of a $100 million term facility and a $50 million revolving facility. The term facility bears interest at US prime rate plus a premium varying from 0.25 per cent. to 1.50 per cent. or at a LIBO rate plus a premium varying from 1.75 per cent. to 3.00 per cent., matures on 23 July 2017, and is repayable in quarterly instalments of $5 million starting in September 2014 up to the maturity date. The revolving facility can be used for the financing of a portion of the permitted acquisitions in a maximum amount of US$41 million and general corporate purposes including the issuance of letters of credit. The revolving facility has no specified terms of repayment and it bears interest and matures on the same basis as the term facility. Amounts of $100 million and $41 million were drawn down from the term facility and revolving facility, respectively, on 23 July 2014 in order to fund the Meritus and GMA acquisitions. For the six months ended 30 June 2015, principal repayments amounted to US$10 million and US$Nil on the term facility and revolving facility, respectively (31 December 2014 – US$10 million and US$4 million respectively). The credit facility is secured by virtually all of the assets of the Group, with the exception of restricted cash held for NETELLER merchants and members (Notes 8 and 9). The security includes share pledges and guarantees from certain subsidiaries within the Group. As at 30 June 2015, the Group has approximately US$9 million outstanding in issued letters of guarantee in relation to various performance bonds drawn from the revolving facility. Under the terms of the loan agreement, the Group must satisfy certain restrictive covenants including minimum financial ratios. These restrictions are composed of ratios of funded debt to EBITDA, funded debt to capitalization and fixed charge coverage ratio. EBITDA, a non-IFRS measure, is defined in the Credit Facility on a consolidated basis, as total comprehensive profit attributable to the owners of the Group before interest expense, income taxes, depreciation, amortization, gains or losses from asset dispositions, gains or losses from extraordinary items and non-recurring transaction costs related to the acquisition of Meritus and GMA, non-cash share option expenses and gains or losses relative to foreign exchange or derivative instruments, plus (or

122 minus) the historical EBITDA of any businesses acquired (or sold) during the reporting period. As at 30 June 2015, all debt covenant requirements and exemptions have been respected. The Group’s credit facility was reﬁnanced on 10 August 2015 (Note 31).

14. FORWARD EXCHANGE CONTRACTS On 23 March 2015, the Group entered into certain forward exchange contracts to hedge its cash flow exposure with respect to currency fluctuations between the cash raised through the Rights Offering (Note 10) in Great Britain Pound (‘‘GBP’’) vs the cash consideration payable for the anticipated business acquisition (Note 31) in EURO (‘‘EUR’’). The forward exchange contracts entered into included commitments to buy e515 million and $82 million in exchange for GBP at varying rates ranging from 1.36308 to 1.35239 (GBP:EURO) and 1.47947 to 1.47344 (GBP:USD) between the period of 11 May 2015 and 23 September. The contract include a variable timing settlement feature to allow for the then unknown completion date of the transaction, which was 10 August 2015 as disclosed in Note 31. The contracts were contingent upon completion of the acquisition and would otherwise expire at no cost to the Group in the event the transaction had not completed. The Group has not elected to adopt hedge accounting for this transaction in accordance with IAS 39. The instrument is carried at fair value using a currency valuation model and is classified as a level 2 investment in accordance with IFRS fair value hierarchy. As at 30 June 2015, an unrealized loss of approximately $29 million on the forward exchange contract was recognized in the accounts and included in foreign exchange loss. During the same period, the Group recognized an unrealized foreign exchange gain of approximately $25 million on the £436 million ($685 million) cash position raised from the Rights Offering and held in GBP in anticipation of the settlement of the forward exchange contracts described above.

15. LOYALTY PROGRAM The Group launched the NETELLER Reward Points Program (the ‘‘Program’’) in February 2012. The Program allows members to earn points on their transactions in the NETELLER eWallet accounts. Members can redeem these points for merchandise, cash exchange, and other NETELLER provided services. When points are earned by Members, the Group establishes a liability for future redemptions by multiplying the number of points issued by the estimated cost per point. The actual cost of merchandise redemptions is applied against this liability. The expense has been included in Marketing and promotions. The estimated cost per point is determined based on many factors, primarily related to expected future redemption patterns and associated costs. The Group monitors, on an ongoing basis, trends in redemption rates and net cost per point redeemed. Adjustments to the estimated cost per point are made based upon expected future Program activities. Any variance in the cost per point is recognised in marketing and promotions expenses in the Group’s consolidated Statement of Comprehensive Income. The liability account is adjusted based on the outstanding balance of points issued on a monthly basis. The Company continues to evaluate and revise certain assumptions used to calculate the Program liability, based on redemption experience and expected future activities.

16. PROVISION FOR LOSSES ON NETBANX MERCHANT ACCOUNTS In certain cases, transactions may be charged back to merchants, which mean the transaction amount is refunded to the consumer and, in certain instances, charged to the merchant. If the merchant has insufficient funds, the Group must bear the credit risk for the full amount of the transaction. Management evaluates the risk for such transactions and estimates the loss for the disputed transactions based primarily on historical experience and other relevant factors. A provision is maintained for merchant losses in order to absorb charge backs and other losses for merchant transactions that have been previously processed and on which revenue has been recorded. Management analyses and regularly reviews the adequacy of its provision for merchant losses. The provision for merchant losses comprises specifically identifiable provisions for merchant transactions for which losses can be estimated based on historical experience.

123 The net charge for the provision for merchant losses is included under the caption Straight Through Processing expenses in the statement of comprehensive income and can be reconciled as follows:

US$

Balance at 31 December 2013 733,362 Provisions made during the year 450,130 Provisions used during the year —

Balance at 31 December 2014 1,183,492 Provisions made during the period — Provisions used during the period (12)

Balance at 30 June 2015 1,183,480

17. TAX The Company is incorporated in the IOM and is subject to a tax rate of zero percent. No provision for IOM taxation is therefore required. Taxation for other jurisdictions is calculated at the rates prevailing in the respective jurisdictions. The Group charge for the period can be reconciled to the proﬁt shown per the Interim Statement of Comprehensive Income as follows:

Six months Six months ended ended 30 June 30 June 2015 2014 Tax recognised in proﬁt US$ US$

Current tax Current period 2,130,193 100,363 Adjustment for prior periods — (204,442)

2,130,193 (104,079)

Deferred tax Current period (8,265) 142,361 Adjustment for prior periods 61,587 —

53,322 142,361

Total tax expense 2,183,515 38,282

Reconciliation of effective tax rate Isle of Man corporate tax rate 0.0% 0.0% Adjustment from prior periods 3.7% (2.5%) Effect of different tax rates of subsidiaries operating in other jurisdictions 43.8% 2.6%

Current period’s tax expense as a % of proﬁt before tax 47.6% 0.1%

At 30 June 2015, foreign taxes of $3,528,272 (31 December 2014: $4,044,775) were outstanding. A total liability of approximately $4.8 million remains outstanding as at 30 June 2015 in relation to an ongoing investigation by the Canadian Revenue Agency regarding Canadian withholding taxes which are deemed to have arisen on the relocation of assets to the Isle of Man from Canada in the 2004 and 2005 taxation years. This liability represents management’s estimate of the maximum amount the Group is likely to be required to pay in respect of such withholding taxes and interest.

124 Movement in deferred tax balances:

Net balance Recognised As at 30 June 2015 as at in proﬁt or Deferred 1 January loss Net Tax Asset $ $ $ $

Property, plant and equipment (325,421) 663,622 338,201 338,201 Intangible assets 885,005 206,615 1,091,620 1,091,620 Carryforward tax losses 91,667 52,599 144,266 144,266 Deferred stock options 140,911 (976,158) (835,247) (835,247)

Deferred tax assets 792,162 (53,322) 738,840 738,840

Net balance Recognised As at 31 December 2014 as at in proﬁt or Deferred Tax 1 January loss Net Asset $ $ $ $

Property, plant and equipment (371,411) 45,990 (325,421) (325,421) Intangible assets 897,967 (12,962) 885,005 885,005 Carryforward tax losses 293,103 (201,436) 91,667 91,667 Deferred stock options — 140,911 140,911 140,911

Deferred tax assets 819,659 (27,497) 792,162 792,162

The deferred tax assets as noted above amounting to $738,840 (31 December 2014: $792,162) have been presented with taxes payable on the Statement of Financial Position.

Deferred tax assets have not been recognised in respect of carryforward tax losses amounting to approximately $1,432,000 (31 December 2014: $1,714,000) in certain companies within the Group since it is not probable that future taxable proﬁt will be available against which the Group can use the beneﬁts therefrom.

18. TRADE AND OTHER PAYABLES The Group had the following balances:

As at As at 30 June 31 December 2015 2014 $ $

Accounts payable 2,615,865 7,693,960 Accrued liabilities 31,885,789 26,080,024 Payroll liabilities 4,291,827 2,962,874

38,793,481 36,736,858

19. NETBANX MERCHANT PROCESSING LIABILITIES The NETBANX merchant processing liabilities arise from the operations of the NETBANX division totaling $35,526,903 (31 December 2014: $30,591,159). In addition, an equivalent transient amount relating to merchant transactions processed via the straight-through processing operations is included in cash and cash equivalents and settlement assets. The operations do not fall within the EU deﬁnition of ‘‘e-money’’ nor does a legal right to offset exist between this cash and the corresponding NETBANX Merchant liabilities.

125 20. OPERATING SEGMENTS The Group has two operating segments as disclosed below. For each of the segments, the Group’s CEO reviews internal management reports on at least a quarterly basis. The following summary describes the operations in each of the Group’s reportable segments. NETELLER: fees are generated on transactions between Members and merchants using the NETELLER service and Net+ prepaid cards. NETBANX: fees are generated through the NETBANX and NETBANX Asia straight-through processing platforms where customers send money directly to merchants. Information regarding the results of each reportable segment is included below.

Segmented reporting for the six months ended 30 June 2015:

NETELLER NETBANX Total $ $ $

Revenue 49,756,862 173,033,711 222,790,573 Variable costs Processing costs 6,217,956 106,966,305 113,184,261 Bad debts 99,242 1,816,194 1,915,436

Total variable costs 6,317,198 108,782,499 115,099,697

Variable margin 43,439,664 64,251,212 107,690,876

Variable margin percentage 87% 37% 48%

Segmented reporting for the six months ended 30 June 2014:

NETELLER NETBANX Total $ $ $

Revenue 41,426,120 117,355,497 158,781,617 Variable costs Processing costs 5,294,091 66,767,894 72,061,985 Bad debts 153,271 1,671 154,942

Total variable costs 5,447,362 66,769,565 72,216,927

Variable margin 35,978,758 50,585,932 86,564,690

Variable margin percentage 87% 43% 55%

Processing costs and bad debts are the only two costs which vary directly with revenue, and accordingly have been shown separately as variable costs. For the six months ended 30 June 2015, variable costs for NETELLER and NETBANX were 13% (2014: 13%) and 63% (2014: 57%) of revenue respectively. Net assets have not been presented in the segmented information since signiﬁcant assets and resources throughout the Group serve both reporting segments and would not reasonably be allocable between the two.

Major Merchants The Group’s Largest Merchant represented 29% of total fee revenue for the six months ended 30 June 2015 (2014: 47%) across all reportable segments and geographies. The majority of this revenue comes from Asia.

126 21. EARNINGS PER SHARE The calculation of the basic and diluted earnings per share is based on the following data:

Six months Six months ended ended June 2015 June 2014 $ $

Proﬁt Proﬁt attributable to equity shareholders of the parent – basic 2,408,625 27,484,609 Interest charge for conversion of shareholder loan — 35,801

Proﬁt attributable to equity shareholders of the parent – diluted 2,408,625 27,520,410

Number of shares Weighted average number of ordinary shares outstanding – basic 329,310,142 275,629,072 Effect of dilutive potential ordinary shares due to employee share options 9,793,810 10,307,597 Share consideration payable 14,684,784 1,579,759

Weighted average number of ordinary shares outstanding – diluted 353,968,736 287,516,428

Earnings per share Basic earnings per share $0.01 $0.10

Fully diluted earnings per share $0.01 $0.10

The average market value of the Company’s shares for purposes of calculating the dilutive effect of share options was based on quoted market prices for the period during which the options were outstanding.

22. SHARE BASED PAYMENTS The Company adopted the unapproved equity-settled share option plan (‘‘ESOS’’) pursuant to a resolution passed on 7 April 2004 and amended by the Board on 15 September 2008. The 2008 amendment included the addition of a new ‘approved’ plan for UK based employees. Under the ‘approved’ and ‘unapproved’ plans, the Board of Directors of the Company may grant share options to eligible employees including directors of Group companies to subscribe for ordinary shares of the Company. No consideration is payable on the grant of an option. Options may generally be exercised to the extent that they have vested. Options vest according to the relevant schedule over the grant period following the date of grant. The exercise price is determined by the Board of Directors of the Company, and shall not be less than the average quoted market price of the Company shares on the three days prior to the date of grant. Subject to the discretion of the Board share options are forfeited if the employee leaves the Group before the options vest. The ESOS options granted vest on the third anniversary of the date of grant and lapse a further six months after vesting. The Company also adopted the Long Term Incentive Plan (‘‘LTIP’’) which took effect from 1 January 2010. These LTIP options vest in one tranche based on future performance related to EBITDA targets determined each year and subject to continued employment over the remaining vesting period. Vested options lapse on the tenth anniversary of the date of grant. On July 9, 2014, the board granted 3,000,000 ‘‘special’’ LTIP options which vest in three tranches based on future performance related to share price targets. For the six month ended 30 June 2015, the Group recognised total expenses of $7,094,621 (2014: $2,756,833) related to share-based payments transactions which are included in salaries and employee expenses.

127 Changes in the number of ESOS and LTIP options outstanding are detailed in the tables below:

ESOS Six Months Ended 31 December 30 June 2015 2014 Weighted Weighted Average Six Months Average Exercise Ended Exercise Year ended Price 30 June 2015 Price 31 December £ Options £ 2014 Options

Outstanding at the beginning of the period 1.73 1,456,750 0.85 1,564,250 Granted during the period 1.15 762,797 3.35 495,500 Forfeited during the period 0.57 (195,796) 1.15 (213,050) Exercised during the period 0.57 (437,706) 0.57 (389,950) Outstanding at the end of the period 1.25 1,586,045 1.73 1,456,750 Exercisable at the end of the period — — 0.57 390,000

The ESOS options outstanding at the end of the period had a weighted average exercise price of £1.25 (31 December 2014: £1.73) and a weighted average remaining contractual life of 1.64 years (31 December 2014: 1.66 years). The weighted average share price of ESOS options exercised in the period based on the date of exercise was £4.36 (31 December 2014: £3.95). During the period, 762,797 additional options were granted to holders of ESOS options previously granted as a result of the Rights Offering (Note 10).

LTIP Six Months Ended 31 December 30 June 2015 2014 Weighted Weighted Average Six Months Average Year ended Exercise Ended Exercise 31 December Price 30 June 2015 Price 2014 £ Options £ Options

Outstanding at the beginning of the period 0.0001 6,729,559 0.0001 5,529,157 Granted during the period 0.0001 6,243,422 0.0001 4,066,993 Forfeited during the period 0.0001 (22,970) 0.0001 (20,000) Exercised during the period 0.0001 (944,706) 0.0001 (2,846,591)

Outstanding at the end of the period 0.0001 12,005,305 0.0001 6,729,559

Exercisable at the end of the period 0.0001 3,558,299 0.0001 674,800

The LTIP options outstanding at the end of the period had an exercise price of £0.0001 and a weighted average remaining contractual life of 8.5 years (31 December 2014: 8.8 years). The weighted average share price of LTIP options exercised in the period based on the date of exercise was £4.49 (31 December 2014: £4.33). During the period, 4,737,050 additional options were granted to holders of LTIP options previously granted as a result of the Rights Offering (Note 10).

128 Assumptions used in ESOS and LTIP options pricing model The fair value of options granted under the ESOS was determined using the Black-Scholes pricing model that takes into account factors speciﬁc to this plan, such as the expected life and vesting period. The following table shows the principal assumptions used in the valuation:

Six months ended Year ended 30 June 31 December 2015 2014

Weighted average exercise price £3.35 £3.35 Expected volatility 40.0% 40.0% Expected life 3.25 years 3.25 years Risk free interest rate 0.92% 0.92% Dividend yield 0% 0% Weighted average fair value per option granted £1.00 £1.00

The fair value of the ‘‘special’’ options granted under the LTIP was determined using a bespoke Monte Carlo pricing model that takes into account the market-based performance conditions speciﬁc to this plan. The following table shows the principal assumptions used in the valuation:

Six months ended Year ended 30 June 31 December 2015 2014

Weighted average exercise price £0.00 £0.00 Expected volatility 41.9% 41.9% Expected life 2.31 years 2.31 years Risk free interest rate 1.20% 1.20% Dividend yield 0% 0% Weighted average fair value per option granted £3.49 £3.49

Expected volatility was determined by calculating the historical volatility of the Company’s share price from the time of issue to the date of grant. Due to the nominal exercise price of the LTIP options and that option holders are entitled to receive a beneﬁt by reference to the value of dividends that would have been paid on vested shares during the vesting period, the regular options granted under the 2014 LTIP were valued based on the share price at the date of grant.

23. RESTRUCTURING COSTS The Group incurred certain restructuring costs relating to the reorganisation of its cost structure. Severance was paid to employees as a result of operational changes to the Group’s business in order to streamline operations and remain competitive in challenging markets. Additional restructuring costs were incurred in the period for speciﬁc persons hired to reorganise the business and various professional fees relating to the anticipated acquisition described in Note 31. The Group incurred the following costs:

Six months ended 30 June 2015 $

Severance and retention payments 1,144,557 Professional fees 2,989,256

4,133,813

129 24. ADJUSTED EBITDA Adjusted EBITDA is deﬁned as results of operating activities before depreciation and amortisation and exceptional non-recurring items which are deﬁned as items of income and expense of such size, nature or incidence, that in the view of management their disclosure is relevant to explain the performance of the Group for the period.

Adjusted EBITDA is not a ﬁnancial measure calculated in accordance with IFRS as adopted by the EU. The presentation on these ﬁnancial measures may not be comparable to similarly titled measures reported by other companies due to the differences in the ways the measures are calculated.

Six months Six months ended ended 30 June 30 June 2015 2014 $ $

Proﬁt before provision for income taxes 4,592,140 27,522,891 Depreciation and amortisation 14,784,369 7,269,757 Finance costs 2,691,125 9,036 Share option expense (Note 21) 7,094,621 2,756,833 Foreign exchange loss / (gain) 5,788,670 (94,502) Loss on disposal of assets — 6,632 Acquisition costs 12,377,267 1,521,355 Restructuring costs (Note 23) 4,133,813 — Net fair value gain on share consideration payable (1,610,000) —

Adjusted EBITDA 49,852,005 38,992,002

25. COMMITMENTS At the balance sheet date, the Group had outstanding commitments for future minimum lease payments, which fall due as follows:

As at As at 30 June 31 December 2015 2014 $ $

Within one year 903,428 1,556,185 In the second to ﬁfth years inclusive 1,208,317 2,196,899 After ﬁve years 409,147 1,152,552

Operating lease payments represent rentals payable by the Group for certain of its ofﬁce properties. Current leases have a remaining average life of 1.9 years. The lease payments recognised in expense for the year are $1,309,756 (31 December 2014: $1,552,929).

26. BUSINESS ACQUISITION On 22 May 2015, the Group acquired 100% of the shares of FANS Entertainment Inc. (‘‘FANS’’), a Montreal-based mobile platform developer founded in 2011, for a consideration of CAD$16 million (approx. US$13 million), payable to the vendors by issuing shares in a subsidiary of Paysafe (the ‘‘Consideration Shares’’) which are exchangeable on a one-for-one basis into shares of Paysafe over the next three years, a portion of which are subject to the satisfaction of certain ﬁnancial performance criteria. The total number of Consideration Shares issued to the vendors was 3,163,633.

The FANS Platform is a fully-integrated solution which helps venues and content providers engage their fans while monetising these services. It is a white-label, multi-level mobile wallet system including a management software and analytics suite, as well as operational and public apps. It can identify users based on mobile behaviour, providing invaluable consumption metrics.

130 FANS provides the Group with a proven technology platform and an experienced management team that will remain in place. FANS has leading clients in the sports and entertainment sectors in Canada and other high-proﬁle venues and events. The acquisition further strengthens Paysafe’s position in the mobile sector of the online payments industry and also provides an entry point into the events market.

Consideration The purchase price allocation was determined using the information available, evaluations obtained and fair value assessments performed by the Group’s management. The following table summarises the consideration paid for FANS and the fair value of the assets acquired and liabilities assumed recognised at the acquisition date.

Cash consideration — Fair value of Deferred consideration at acquisition datea 8,598,000 Fair value of Contingent consideration at acquisition datea 2,084,000

Total estimated purchase price 10,682,000

Trade and other receivables 669,980 Cash and cash equivalents 278,477 Prepaid expenses and deposits 14,117 Property, plant & equipment (Note 7) 69,965 Trade and other payables (313,477) Amounts payable to a company under common controlb (1,112,352) Finite-life intangible assets (Note 6) 7,700,000

Fair value of net assets acquired 7,306,710

Goodwill (Note 5) 3,375,290

a At closing date, the number of Paysafe Ordinary Shares equal to CAD $16,000,000 was determined to be 3,163,633 shares, of which 790,098 are contingent upon the satisfaction of certain ﬁnancial performance criteria. The estimated fair value of this deferred and contingent consideration at the acquisition date was determined using liquidity discounts reﬂecting the lack of marketability during the lockup period. As at 30 June 2015, fair value of the share consideration payable is $7,349,959, of which $705,959 has been included in the current liabilities representing the remaining balance able to be converted into Paysafe Ordinary Shares within the next twelve months. The fair value of the contingent consideration is valued at $2,084,000. b Prior to acquiring FANS, a company within the Group made an interest-bearing loan in the amount of $1,112,352 to FANS in support of its operating working capital requirements. Following the acquisition, the amounts were eliminated upon consolidation. FANS revenues of $0.03 million and net loss incurred of $0.12 million are included in the consolidated interim statement of comprehensive income from the date of acquisition. The Group’s consolidated revenues and net loss for the period ended 30 June 2015 would have included $0.17 million and $0.65 million, respectively, had the FANS Acquisition occurred on 1 January 2015. On 22 June, 303,097 FANS Consideration Shares were converted into shares of the Company. The Group incurred acquisition-related costs of approximately $270,000 to 30 June 2015 which were expensed in the period relating to this transaction.

27. FINANCIAL INSTRUMENTS Financial instruments consist of cash and cash equivalents, settlement assets, restricted NETELLER merchant cash, restricted NETELLER Member cash, cash held as reserves, trade and other receivables, and trade and other payables. All financial instruments are classified as held for trading except for accounts receivable and accounts payable which are classified as loans and receivables. (a) Fair values The Group estimates the fair value of its financial instruments based on current interest rates, market value and pricing of financial instruments with comparable terms.

131 The fair values of cash and cash equivalents, restricted NETELLER merchant cash, restricted NETELLER Member cash, trade and other receivables, and trade and other payables approximate the carrying values due to the short-term nature of these instruments. The fair value of the obligations under finance lease as at 30 June 2015 has been established by discounting the future cash flows using interest rates corresponding to those which the Group would currently be able to obtain for leases with similar maturity dates and terms. (b) Credit risk and concentrations Credit risk is the risk of financial loss to the Group if a member or merchant counter party to a financial instrument fails to meet its contractual obligations, and arises principally from the Group’s cash and cash equivalents, restricted NETELLER merchant cash, restricted NETELLER member cash, and trade and other receivables. The cash and cash equivalents, restricted NETELLER merchant cash and restricted NETELLER member cash are deposited with major financial institutions which the Group’s management believes to be financially sound and, accordingly, minimal credit risks exist with respect to these assets. The Group is exposed to credit risk to the extent that its members and merchants may charge back credit card purchases. The Group manages the exposure to credit risk by employing various online identification verification techniques, enacted transaction limits and having a significant number of members and merchants. As these members are geographically widespread and the merchants are active in various industries, the exposure to credit risk and concentration is mitigated. As at the reporting date, the maximum credit exposure of the Group’s financial assets exposed to credit risk amounted to the following:

Neither past Past due: due or Past due: Past due: more than impaired 1-30 days 31-90 days 90 days As at 30 June 2015 $ $ $ $

Cash and cash equivalents 798,562,168 — — — Settlement assets 40,080,913 — — — Restricted NETELLER merchant cash 290,118 — — — Restricted NETELLER member cash 8,083,567 — — — Cash held as reserves 8,922,879 — — — Trade and other receivables 15,407,519 428,445 436,080 843,665

Total 871,347,164 428,445 436,080 843,665

Neither past Past due: due or Past due: Past due: more than impaired 1-30 days 31-90 days 90 days As at 31 December 2014 $ $ $ $

Cash and cash equivalents 109,892,558 — — — Settlement assets 29,849,176 — — — Restricted NETELLER merchant cash 2,232,596 — — — Restricted NETELLER member cash 6,543,680 — — — Cash held as reserves 8,757,914 — — — Trade and other receivables 13,289,769 388,081 342,946 691,033

Total 170,565,693 388,081 342,946 691,033

(c) Interest rate risk The Group is exposed to interest rate risk to the extent that investment revenue earned on cash and cash equivalents, and Restricted Neteller merchant and member cash, and interest expense incurred on debt owing are subject to ﬂuctuations in interest rates. The Group’s exposure to interest rate risk is limited as investments are held in liquid and short-term funds. A sensitivity analysis has been performed wherein 1% increase in interest rates offered would result in a

132 $4,140,477 (31 December 2014: $2,613,188) favourable impact on net earnings while a 1% decrease would result in a $628,519 (31 December 2014: $688,377) unfavourable impact on net earnings.

(d) Currency risk The Group is exposed to currency risk due to ﬁnancial assets and liabilities denominated in a currency other than the functional currency, primarily the Great Britain Pound (‘‘GBP’’), the EURO (‘‘EUR’’), the Canadian dollar (‘‘CAD’’), and the Hong Kong Dollar (‘‘HKD’’). The Group manages the exposure to currency risk by commercially transacting in US dollars and by limiting the use of other currencies for operating expenses, wherever possible, thereby minimising the realised and unrealised foreign exchange gain/(loss). Where limited exposures exist, these are managed through entering into forward foreign exchange contracts as appropriate (Note 4).

The Group’s exposure as at the reporting date was as follows:

GBP EUR CAD HKD As at 30 June 2015 £ e $ $

Cash and cash equivalents 462,809,398 17,279,525 5,392,891 117,581,338 Settlement assets 1,719,031 5,097,628 5,441 128,196,423 Segregated account funds (Note 8) 7,522,709 29,632,579 — — Qualifying liquid assets held for NETELLER members (Note 9) 8,396,332 62,421,740 1,205 — Cash held as reserves 1,323,180 — 50,000 — Trade and other receivables 4,709,993 153,141 2,880,712 88,020 Trade and other payables (9,463,487) (17,889) (3,681,982) (9,246,533) NETBANX merchant processing liabilities (2,118,288) (4,531) (1,455,080) (155,617,606) Payable to NETELLER merchants (Note 8) (7,613,706) (30,860,150) (337,213) — Payable to NETELLER members (Note 9) (7,898,297) (61,289,190) (183,902) — Income taxes payable (119,498) — (6,360,881) — Obligations under ﬁnance lease — — (448,388) —

Total 459,267,367 22,412,853 (4,137,197) 81,001,642

GBP EUR CAD HKD As at 31 December 2014 £ e $ $

Cash and cash equivalents 26,585,646 13,792,199 5,417,911 114,392,514 Settlement assets 968,889 5,532,292 4,850 111,457,106 Segregated account funds (Note 8) 8,138,040 28,245,285 — — Qualifying liquid assets held for NETELLER members (Note 9) 7,437,580 49,560,936 1,197 — Cash held as reserves 1,327,277 — 50,000 — Trade and other receivables 1,014,290 163,944 1,523,807 — Trade and other payables (8,217,160) (18,466) (4,963,140) (9,077,864) NETBANX merchant processing liabilities (1,548,136) (6,914) (1,159,801) (231,101,814) Payable to NETELLER merchants (Note 8) (8,582,082) (27,543,340) (410,332) (1) Payable to NETELLER members (Note 9) (7,151,487) (49,340,705) (152,062) — Income taxes payable — — (5,819,162) — Obligations under ﬁnance lease — — (655,411) —

Total 19,972,857 20,385,231 (6,162,143) (14,330,059)

133 As at 30 June 2015, had the US Dollar strengthened by 1% in relation to all the other currencies, with all other variables held constant, the net assets of the Group would have been decreased in both profit and equity by US $7,538,561 (31 December 2014: $470,618). A weakening of the US Dollar by 1% against the above currencies would have had an equal and opposite effect. (e) Market segment risk Market segment risk may arise due to adverse changes in legislation relating to internet, payment processing or on-line gambling. The Group is exposed to market segment risk to the extent that legislation impacts operational presence and related revenue streams, which may be significant. The Group manages this exposure through geographical diversification and participation in non gambling sources of revenue. The Group closely monitors local legislation in key markets (new or existing) and does not have economic reliance on any one country. (f) Liquidity risk Liquidity risk is the risk that the Group will be unable to meet its financial obligations as they fall due. Management controls and monitors the Group’s cash flow on a regular basis, including forecasting future cash flows. The Group’s objective to managing liquidity is to ensure that, as far as possible, that it will always have sufficient liquidity to meet the liabilities when they become due. The table below summarises the maturity profile of the Group’s financial liabilities based on contractual undiscounted payments:

Less than 3to12 On demand 3 months months 1 to 5 years As at 30 June 2015 $ $ $ $

Long-term debt — 5,000,000 15,000,000 97,000,000 Trade and other payables 22,471,750 10,505,363 4,974,644 841,724 NETBANX merchant processing liabilities 35,526,903 — — — NETELLER loyalty program 1,214,085 — — — Provision for losses on NETBANX merchant accounts 1,183,480 — — — Contingent consideration — 5,000,000 — — Obligations under ﬁnance lease — 154,558 126,703 192,488

Total 60,396,218 20,659,921 20,101,347 98,034,212

Less than 3 3to12 On demand months months 1 to 5 years As at 31 December 2014 $ $ $ $

Long-term debt — 5,000,000 15,000,000 107,000,000 Trade and other payables 18,191,414 12,693,194 5,457,579 394,671 NETBANX merchant processing liabilities 30,591,159 — — — NETELLER loyalty program 1,159,980 — — — Provision for losses on NETBANX merchant accounts 1,183,492 — — — Contingent consideration — — 5,000,000 — Obligations under ﬁnance lease — 144,697 434,100 204,808

Total 51,126,045 17,837,891 25,891,679 107,599,479

(g) Risk management assets and liabilities Risks are identiﬁed, evaluated and mitigated through a combination of a ‘‘top down’’ approach driven by both the Audit Committee and Board of Directors. These are aggregated into a Risk Management framework where the risks are prioritised and assigned to the executive for monitoring and risk mitigation. The Group Internal Audit function undertakes regular reviews of the controls that are in place to mitigate risk. The Group enters into ﬁnancial instruments through forward

134 currency contracts that fix the net asset or liability position for significant currencies held on the Statement of Financial Position. (h) Capital disclosure The Group’s capital structure is comprised of shareholders’ equity, deferred and contingent consideration as well as secured credit facilities as required to fund business and asset acquisitions. The Group’s objective when managing its capital structure is to finance internally generated growth and maintain financial flexibility including access to capital markets. To manage its capital structure the Group may adjust capital spending, issue new shares, or acquire short-term financing. (i) Capital risk management The Group manages its capital to ensure that the entities in the Group will be able to continue as a going concern, while maximising the return to stakeholders through optimisation of the debt and equity balance. The capital structure of the Group consists of debt, which includes the borrowings as disclosed in Note 13, and equity attributable to owners of the parent, comprising reserves and retained earnings as disclosed. The board reviews the capital structure and as part of this review, considers the cost of capital and the risks associated with each class of capital. In addition the board of directors considers the liquidity and solvency of the Group on an ongoing basis. The primary measure used by the Group to monitor its financial leverage is its ratio of net debt to equity. The net-debt-to equity ratios as at 30 June 2015 and 31 December 2014 are as follows:

As at As at 30 June 31 December 2015 2014

Contingent consideration 7,084,000 5,000,000 Obligations under ﬁnance lease 473,749 783,605 Long term debt (Note 13) 117,000,000 127,000,000 Cash and cash equivalents (798,562,168) (109,892,558) Restricted NETELLER Merchant cash (Note 8) (290,118) (2,232,596) Restricted NETELLER Member cash (Note 9) (8,083,567) (6,543,680)

Net debt (682,378,104) 14,114,771

Equity 942,068,330 265,610,745

Net debt-to-equity (0.72:1) 0.05:1

In accordance with the terms of the Group’s credit facility (see Note 13), the Share Consideration Payable of $63,029,959 (31 December 2014: $57,290,000) has been included in Equity for the purposes of the Net debt-to-equity calculation above.

135 28. RELATED PARTY TRANSACTIONS Investment in subsidiaries Details of the Company’s principal subsidiaries as at 30 June 2015 are as follows:

PLACE OF PROPORTION OF PROPORTION OF PRINCIPAL ACTIVITY INCORPORATION OWNERSHIP VOTING POWER NAME OF SUBSIDIARY AND OPERATION INTEREST HELD

Optimal Payments Limited United Kingdom 100% 100% Authorised e-money issuer NetBanx Limited United Kingdom 100% 100% Full service payment processing Optimal Payments Services Limited United Kingdom 100% 100% Dormant Netinvest Limited United Kingdom 100% 100% Holding company Netpro Limited United Kingdom 100% 100% Dormant Optimal Payments (UK) Limited United Kingdom 100% 100% Sales and administration services Optimal Payments (Bulgaria) EOOD Bulgaria 100% 100% NETELLER call centre and customer support NT Services Limited Canada 91% 100% Employment and administration NT Services Building Corporation Canada 100% 100% Property leasing company 1155259 Alberta Limited Canada 100% 100% Financing Cardload Incorporated Canada 100% 100% Dormant NBX Checkout Inc. Canada 100% 100% Canadian sales company NetBX Services Inc. Canada 100% 100% Canadian support company NetBX Technologies Inc. Canada 100% 100% Canadian technology/ development company NBX Merchant Services Inc. Canada 100% 100% Canadian sales company Optimal Payments Callco Inc. Canada 100% 100% Holding company Optimal Payments Exchangeco Inc. Canada 100% 100% Holding company FANS Entertainment Inc. Canada 100% 100% Canadian mobile development company NBX Merchant Services (Australia) PTY Australia 100% 100% Australian sales Limited company FANS Entertainment LLC United States 100% 100% US mobile development company NBX Merchant Services Corporation United States 100% 100% US sales company Optimal Payments Services Inc. United States 100% 100% US-based money transmission services (applicable licenses pending) OPL Payment Services LLC United States 100% 100% US sales company NBX Holdings Corporation United States 100% 100% Holding company NBX Services Corporation United States 100% 100% Full service payment processing NetBX Services LLC United States 100% 100% US sales company TK Global Partners LP United States 100% 100% Full service payment processing Optimal Payments Merchant Services Isle of Man 100% 100% Licensed to carry on Limited money transmission services Net Group Holdings Limited Isle of Man 100% 100% Holding company NetAdmin Limited Isle of Man 100% 100% Employment & administration Net ID Limited Isle of Man 100% 100% Identiﬁcation veriﬁcation NetB Limited Isle of Man 100% 100% Dormant Optimal Payments Merchant Services Mauritius 100% 100% Mauritius sales (Mauritius) Limited company Netbanx BV Limited Netherlands 100% 100% Holding company

136 Compensation of key management personnel Key management personnel are those persons having authority and responsibility for planning, directing and controlling the activities of the Group, directly or indirectly, including any Director (whether executive or otherwise) of the Group. The compensation expense for transactions with the Group’s key management personnel consists of the following:

Six month Six month period ended period ended 30 June 30 June 2015 2014 $ $

Short-term employee benefits 2,380,348 1,265,420 Post-employment benefits 22,359 19,500 Termination benefits 702,983 — Share-based payments 5,708,500 1,060,995

8,814,190 2,345,915

29. CONTINGENT LIABILITIES From time to time the Group is subject to legal claims and actions. The Group takes legal advice as to the likelihood of success of the claims and actions and no provision or disclosure is made where the Directors feel, based on that advice, the action is unlikely to result in a material loss or a sufﬁciently reliable estimate of the potential obligation cannot be made. As at 30 June 2015, NetBanx Limited, a wholly owned subsidiary, has net current liabilities. Paysafe Group plc will continue to provide ﬁnancial support to enable NetBanx Limited to meet its existing and future liabilities and continue as a going concern.

30. AUDITOR REMUNERATION Remuneration of the auditors for audit, advisory and other services has been recorded as follows:

Six month Six month period ended period ended 30 June 30 June 2015 2014 US$ US$

Audit services Statutory audit 250,000 250,000 Non-audit services Other advisory services 622,278 —

Total 872,278 250,000

31. POST-BALANCE SHEET EVENTS Business Acquisition On August 10, 2015, the Group acquired all of the interest of Sentinel Topco Limited (‘‘Skrill’’) for an enterprise value of e1.1 billion (US$1.2 billion) from Sentinel Group Holdings S.A., ultimately owned by funds managed and advised by subsidiaries of CVC Capital Partners SICAV-FIS S.A., Investcorp Technology Partners, and other shareholders. Skrill is one of Europe’s leading digital payments businesses providing digital wallet solutions and online payment processing capabilities and is one of the largest pre-paid online voucher providers in Europe with its paysafecard brand. A subsidiary of Paysafe, Netinvest Limited, acquired the entire issued share capital of Skrill in exchange for e720 million (US$790 million) cash and 37,493,053 new Ordinary Shares. Following Completion, Sentinel Group Holdings S.A. held approximately 7.9 per cent. of the ordinary share capital of Paysafe immediately following Completion. The value of the equity consideration for Skrill was e135 million (US$148 million), based on the theoretical ex-rights price of the Rights Issue, which together with the cash consideration and the

137 net debt of Skrill as at 31 December 2014 of e256 million (US$277 million) gives an enterprise valuation of Skrill of approximately e1.1 billion (US$1.2 billion). The Directors of Paysafe believe that the Skrill Acquisition will be transformational and value enhancing for Paysafe and will create a leading payment and digital wallet provider with significant international scale and reach that is well positioned to capitalise on the substantial and growing payment processing and digital wallet markets, particularly within the rapidly expanding online gambling sector. The Skrill Acquisition will futher diversify the Group’s merchant portfolio and geographic reach. Furthermore, the Skrill Acquisition provides the Group with a strong financial rationale and substantial potential synergies and is expected to be EPS accretaive from the first full fiscal year following Completion. The Skrill Acquisition includes intellectual property, customer contracts and supplier and customer lists and the Group is currently in the process of determining the fair value of the assets acquired and as such, the disclosures required by IFRS 3 Business Combinations have not been prepared. The cash consideration was financed through a combination of available cash, new debt facilities and a fully underwritten Rights Issue. BMO Capital Markets, Barclays Bank PLC and Deutsche Bank Luxembourg S.A. have provided financing for the Acquisition via credit facilities of e500 million ($555 million) term loans and US$85 million revolving facility. As a result of the Skrill Acquisition and new debt facilities, the Group’s existing debt facility with Bank of Montreal (Note 13) has been fully re-financed. The Group raised approximately £463 million (US$702 million) through a Rights Issue of 5 new Ordinary Shares at 166 pence per share for every 3 Existing Ordinary Shares (Note 10). The Rights Issue was fully underwritten by Canaccord Genuity Limited, Deutsche Bank AG, London Branch and BMO Capital Limited. The Group incurred acquisition related costs of approximately US$12 million during the six months ended 30 June 2015 which were expensed in the period relating to this transaction.

138 SECTION C: AUDITED FINANCIAL INFORMATION OF THE PAYSAFE GROUP FOR THE THREE YEARS ENDED 31 DECEMBER 2014

The audited consolidated ﬁnancial statements of the Paysafe Group for the three years ended 31 December 2014, together with the accountants’ reports for the three years ended 31 December 2014, are set out on pages 177 to 218 of the March 2015 Prospectus and are incorporated by reference into this document. The accountants’ reports for the three years ended 31 December 2014 were unqualiﬁed. See Part XII (Information Incorporated by Reference) of this document for further details about information that has been incorporated by reference into this document.

139 SECTION D: ACCOUNTANTS’ REPORT ON THE AUDITED FINANCIAL INFORMATION OF TK GLOBAL PARTNERS, LP (‘‘MERITUS’’) FOR THE THREE YEARS ENDED 31 DECEMBER 2014

The Directors Paysafe Group plc Audax House 6 Finch Road Douglas Isle of Man

18 December 2015

Dear Sirs

TK Global Partners, LP (‘‘Meritus’’) We report on the ﬁnancial information set out on pages 142 to 158 for the three years ended ended 31 December 2014. This ﬁnancial information has been prepared for inclusion in the Prospectus dated 18 December 2015 of Paysafe Group plc on the basis of the accounting policies set out in notes 3 and 4. This report is required by Paragraph 20.1 of Annex 1 of the Prospectus Directive Regulation and is given for the purpose of complying with that paragraph and for no other purpose.

Opinion on financial information In our opinion, the financial information gives, for the purposes of the Prospectus dated 18 December 2015, a true and fair view of the state of affairs of TK Global Partners, LP as at the three years ended 31 December 2014 and of its profits, cash flows and changes in equity for the three years then ended in accordance with the basis of preparation set out in notes 3 and 4, and in accordance with International Financial Reporting Standards as adopted by the European Union as described in note 3.

140 Declaration For the purposes of Prospectus Rule 5.5.3R(2)(f) we are responsible for this report as part of the Prospectus and declare that we have taken all reasonable care to ensure that the information contained in this report is, to the best of our knowledge, in accordance with the facts and contains no omission likely to affect its import. This declaration is included in the Prospectus in compliance with paragraph 1.2 of Annex I of the Prospectus Directive Regulation.

Yours faithfully

KPMG Audit LLC

141 SECTION E: AUDITED FINANCIAL INFORMATION OF TK GLOBAL PARTNERS, LP (‘‘MERITUS’’) FOR THE THREE YEARS ENDED 31 DECEMBER 2014

Statement of Financial Position As at 31 December

31 Dec 31 Dec 31 Dec 2012 2013 2014 US$’000 US$’000 US$’000

ASSETS Non-current assets Property and equipment (Note 6) 310 63 1,397 Capitalized Customer Acquisition Costs (Note 7) 9 — — Other assets 19 15 78

338 78 1,475 Current assets Cash and cash equivalents 3,218 4,440 7,699 Cash held as reserves (Note 5) 668 1,267 1,008 Trade and other receivables 2,581 3,261 4,390 Inventories 51 97 113 Prepaid expenses and deposits 16 99 103

6,534 9,164 13,313

Total assets 6,872 9,242 14,788

LIABILITIES Current liabilities Trade and other payables (Note 8) 4,563 7,460 7,643 Deferred revenue 70 104 109

4,633 7,564 7,752 Non-current liabilities Deferred rent — — 248

Total liabilities 4,633 7,564 8,000 Partners’ capital (Note 9) 2,239 1,679 6,788

Total equity 6,872 9,242 14,788

The notes form an integral part of this ﬁnancial information.

142 Statement of Comprehensive Income For the year ended 31 December

31 Dec 31 Dec 31 Dec 2012 2013 2014 US$’000 US$’000 US$’000

Revenue Merchant fees 38,208 74,280 88,955 Equipment sales and leases 77 143 166

38,285 74,423 89,121

Cost of Sales Interchange (17,120) (37,459) (50,270) Commissions and other merchant costs (11,705) (19,777) (17,314)

(28,825) (57,236) (67,584)

Gross proﬁt 9,460 17,187 21,537 Expenses General and administrative expenses (8,846) (16,381) (14,996)

Results from operating activities 614 806 6,541 Finance income 124 299 186 Finance costs (15) (15) (18)

109 284 168

Proﬁt for the year 723 1,090 6,709

The notes form an integral part of this ﬁnancial information. The General Partners consider that all results derive from continuing activities.

Statement of Partners’ Capital

Partners’ capital (Note 9) Total US$’000 US$’000

Balance as at 1 January 2012 1,826 1,826 Proﬁt for the year 723 723

Total comprehensive income 2,549 2,549 Transactions with owners of the Partnership, recognised directly in equity —— Contributions by and distributions to owners of the Partnership (310) (310)

Balance as at 31 December 2012 2,239 2,239

143 Partners’ capital (Note 9) Total US$’000 US$’000

Balance as at 1 January 2013 2,239 2,239 Proﬁt for the year 1,090 1,090

Total comprehensive income 3,329 3,329 Transactions with owners of the Partnership, recognised directly in equity —— Contributions by and distributions to owners of the Partnership (1,650) (1,650)

Balance as at 31 December 2013 1,679 1,679

Partners’ capital (Note 9) Total US$’000 US$’000

Balance as at 1 January 2014 1,679 1,679 Proﬁt for the year 6,709 6,709

Total comprehensive income 8,388 8,388 Transactions with owners of the Partnership, recognised directly in equity —— Contributions by and distributions to owners of the Partnership (1,600) (1,600)

Balance as at 31 December 2014 6,788 6,788

The notes form an integral part of this ﬁnancial information.

144 Statement of Cash Flows For the year ended 31 December

31 Dec 31 Dec 31 Dec 2012 2013 2014 US$’000 US$’000 US$’000

CASH FLOWS FROM OPERATING ACTIVITIES Proﬁt before tax 723 1,090 6,709 Adjustments for: Depreciation and amortisation (Note 6 and 7) 371 209 293 Impairment loss — 119 — Allowance for doubtful debts 9 82 — Loss reserves (43) 134 — Deferred compensation expense — 101 —

Operating cash ﬂows before movements in working capital (Increase)/decrease in prepaid expenses and deposits 24 (83) (4) (Increase)/decrease in trade and other receivables (894) (893) (867) (Increase)/decrease in inventories — (46) (16) Increase/(decrease) in trade and other payables (219) 619 171 Increase/(decrease) in deferred revenue (56) 33 2

Cash generated by operations (85) 1,365 6,288

Net cash generated by operating activities (85) 1,365 6,288

CASH FLOWS FROM INVESTING ACTIVITIES Purchase of property, plant & equipment (112) (72) (1,627) Purchases of customer lists (2) — —

Net cash consumed by investing activities (114) (72) (1,627) CASH FLOWS FROM FINANCING ACTIVITIES Accrued and unpaid commissions due to related parties 300 2,178 (62) Distributions to partners (310) (1,650) (1,600)

Net cash consumed by ﬁnancing activities (10) 528 (1,662)

INCREASE IN CASH AND CASH EQUIVALENTS DURING THE YEAR (209) 1,821 2,999

CASH AND CASH EQUIVALENTS, BEGINNING OF YEAR 4,095 3,886 5,707

CASH AND CASH EQUIVALENTS, END OF YEAR 3,886 5,707 8,706

The notes form an integral part of this ﬁnancial information.

145 Notes to the Financial Information for the year ended 31 December 2014 1. GENERAL INFORMATION TK Global Partners, L.P. DBA Meritus Payment Solutions (the ‘‘Partnership’’) was a limited liability Partnership incorporated under the laws of the State of California on April 2008 and was converted into a limited partnership by entering into an agreement of limited partnership under the provisions of the laws of the State of California on July 2009.

2. NATURE OF OPERATIONS The Partnership’s primary business is to provide card payment processing services to merchants throughout the United States. This involves providing end-to-end electronic payment processing services to merchants by facilitating the exchange of information and funds between them and cardholders’ financial institutions. The Partnership accomplishes this through multiple sales channels who solicit small to medium sized merchants as well as sales partners who solicit business on the Partnership’s behalf. Card payment processing services also includes selling and renting point-of-sale devices. Over 70% of the Partnership’s revenue is derived from processing and settling Visa and MasterCard bankcard transactions for its merchant customers. Because the Partnership is not a ‘‘member bank’’ as defined by Visa and MasterCard, in order to process and settle these bankcard transactions for its merchants, the Partnership has entered into sponsorship agreements with member banks. Visa and MasterCard rules restrict the Partnership from performing funds settlement or accessing merchant settlement funds and require that these funds be in the possession of the member bank until the merchant is funded. A sponsorship agreement permits the Partnership to route Visa and MasterCard bankcard transactions under the member bank’s control and identification numbers to clear credit and signature debit bankcard transactions through Visa and MasterCard. A sponsorship agreement also enables the Partnership to settle funds between cardholders and merchants by delivering funding files to the member bank, which in turn transfers settlement funds to the merchants’ bank accounts. These restrictions place the settlement assets and obligations under the control of the member bank. The sponsorship agreements with the member banks require, among other things, that the Partnership abide by the bylaws and regulations of the Visa and MasterCard networks, and certain of the sponsor banks require a certificate of deposit or a cash balance in a deposit account. If the Partnership were to breach a sponsorship agreement and under certain circumstances, the sponsor banks may terminate the agreement and, under the terms of the agreement, the Partnership would have 180 days to identify an alternative sponsor bank. The Partnership is generally dependent on its sponsor banks, Visa and MasterCard for notification of any compliance breaches. As of 31 December 2014 the Partnership has not been notified of any such issues by its sponsor banks, Visa or MasterCard. At 31 December 2014, the majority of the Partnership’s business is transacted through three bank sponsorship agreements: * On September 17, 2008, the Partnership entered into a merchant program processing agreement with Wells Fargo Bank, N.A. (‘‘WFB’’). The WFB agreement will be in effect until April 30, 2014, and will automatically renew for successive one year periods unless either party provides a 90 days written notice of non-renewal to the other party. * On July 1, 2011, the Partnership entered into an Independent Sales Organization agreement with Woodforest National Bank (‘‘WNB’’). The WNB agreement will be in effect until June 30, 2017, and will automatically renew for successive one year periods unless either party provides a 90 days written notice of non-renewal to the other party. * On July 29, 2009, the Partnership entered into a merchant marketing and processing services agreement with National Bank of California (‘‘NBC’’). The NBC agreement will be in effect until July 28, 2014, and will automatically renew for successive one year periods unless either party provides a 180 days written notice of non-renewal to the other party. The Partnership also provides card transaction processing for DFS Services, LLC (‘‘Discover’’) and American Express Travel Related Services Partnership, Inc. (‘‘American Express’’). The Partnership processes Discover and American Express transactions similarly to how it processes Visa and MasterCard transactions.

146 3. BASIS OF PREPARATION (i) Statement of compliance The ﬁnancial information have been prepared and presented in accordance with applicable law and International Financial Reporting Standards (‘‘IFRS’’) as adopted by the EU. The ﬁnancial information was authorised for issue by the Board of Directors of Paysafe Group PLC.

(ii) Basis of measurement The ﬁnancial information has been prepared on the historical cost basis. The methods used to measure fair values for disclosure purposes are discussed further in note 11.

(iii) Statement of going concern The financial information is prepared on a going concern basis, as the Board of Directors of Paysafe Group PLC are satisfied that the Partnership have the resources to continue in business for the foreseeable future. In making this assessment, the Board have considered a wide range of information relating to present and future conditions, including future projections of profitability, cash flows and capital resources. The Partnership’s objectives, policies and processes for managing credit, liquidity and market risk along with the Partnership’s approach to capital management and allocation are described in the Notes of the financial information.

(iv) Use of estimates and judgements The preparation of the Partnership’s financial information requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities and contingencies at the date of the Partnership’s financial information, and revenue and expenses during the reporting period. Actual results could differ from those estimated. Significant estimates in the Partnership’s financial information include receivables recoverability and processing liabilities, as disclosed in note 4. The entity makes provisions for such based on previous experience and current assessments. By their nature, these estimates and assumptions are subject to estimation uncertainty and the effect on the Partnership’s financial information of changes in estimates in future periods could be significant. Estimates and underlying assumptions are reviewed on an annual basis. Revisions to estimates are recognised prospectively.

(v) Functional and presentation currency The ﬁnancial information is presented in US dollars, which is the functional currency of the Partnership. All amounts are rounded to the nearest thousand unless otherwise stated.

4. SIGNIFICANT ACCOUNTING POLICIES The accounting policies set out below have been applied consistently to all periods presented in these financial information, and have been applied consistently by the Partnership. Where appropriate these accounting policies have been aligned with those adopted by the Paysafe Group for all periods presented. The following principal accounting policies have been applied: a) Cash and cash equivalents Cash equivalents are defined as time deposits, certificate of deposits, and all highly-liquid debt instruments with original maturities of three months or less. b) Inventories Inventories are measured at the lower of cost and net realisable value. The cost of inventories is based on the first-in first-out principle, and includes expenditure incurred in acquiring the inventories and other costs incurred in bringing them to their existing location and condition. Net realisable value is the estimated selling price in the ordinary course of business, less the estimated costs of completion and estimated costs necessary to make the sale.

147 c) Capitalized Customer Acquisition Costs Capitalized customer acquisition costs include costs associated with the establishment of new merchant relationships. Costs associated with capitalized customer acquisition costs are amortized on the straight-line method over a period of ﬁve years. Capitalized customer acquisition costs are subject to amortization and are reviewed for potential impairment whenever events or circumstances indicate that carrying amounts may not be recoverable. d) Property and equipment (ii) Recognition and measurement Items of property and equipment are measured at cost less accumulated depreciation and accumulated impairment losses. Cost includes expenditure that is directly attributable to the acquisition of the asset. The cost of self-constructed assets includes the cost of materials and direct labour, any other costs directly attributable to bringing the assets to a working condition for their intended use. Purchased software that is integral to the functionality of the related equipment is capitalised as part of that equipment. When parts of an item of property and equipment have different useful lives, they are accounted for as separate items (major components) of property, plant and equipment. The gain or loss on disposal of an item of property and equipment is determined by comparing the proceeds from disposal with the carrying amount of the property, plant and equipment and is recognised net within ‘‘other income’’ or ‘‘other expenses’’ in proﬁt or loss.

(iii) Subsequent costs The cost of replacing a component of an item of property and equipment is recognised in the carrying amount of the item if it is probable that the future economic benefits embodied within the component will flow to the Partnership and its cost can be measured reliably. The carrying amount of the replaced part is derecognised. The cost of the day-to-day servicing of property, plant and equipment are recognised in profit or loss as incurred.

(iv) Depreciation Deprecation is based on the cost of an asset less its residual value. Signiﬁcant components of individual assets are assessed and if a component has a useful life that is different from the remainder of that asset, that component is depreciated separately. Depreciation is recognised in proﬁt or loss on a straight-line basis over the estimated useful life of each component of an item of property and equipment. Property developed and related improvements made on leased land are depreciated over the shorter of the land’s lease term and the useful lives of the building and improvements unless it is reasonably certain that the Partnership will obtain ownership of the land by the end of the lease term. The estimated useful lives of the related assets are as follows:

Machinery and ofﬁce equipment 20% Software 2 years Computer equipment 20% Leasehold improvements 3 years Depreciation methods, useful lives and residual values are reviewed at each ﬁnancial year-end and adjusted if appropriate.

(v) Impairment A financial asset not carried at fair value through profit or loss is assessed at each reporting date to determine whether there is objective evidence that it is impaired. A financial asset is impaired if objective evidence indicates that a loss event has occurred after the initial recognition of the asset, and that the loss event had a negative effect on the estimated future cash flows of that asset that can be estimated reliably. Objective evidence that financial assets are impaired can include default or delinquency by a debtor, restructuring of an amount due to the Partnership on terms that the Partnership would not consider otherwise, indications that a debtor or issuer will enter bankruptcy, economic conditions

148 that correlate with defaults or the disappearance of an active market for a security. In addition, for an investment in an equity security, a significant or prolonged decline in its fair value below its cost is objective evidence of impairment. An impairment loss in respect of a financial asset measured at amortised cost is calculated as the difference between its carrying amount and the present value of the estimated future cash flows discounted at the asset’s original effective interest rate. Losses are recognised in profit or loss and reflected in an allowance account against receivables. Interest on the impaired asset continues to be recognised. When a subsequent event causes the amount of impairment loss to decrease, the decrease in impairment loss is reversed through profit or loss. The carrying amounts of the Partnership’s non-financial assets are reviewed at each reporting date to determine whether there is any indication of impairment. If any such indication exists, then the asset’s recoverable amount is estimated. For goodwill and intangible assets that have indefinite useful lives or that are not yet available for use, the recoverable amount is estimated each year at the same time. An impairment loss is recognised if the carrying amount of an asset or its related cash-generating unit (CGU) exceeds its estimated recoverable amounts. The recoverable amount of an asset or CGU is the greater of its value in use and its fair value less costs to sell. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset or CGU. For the purpose of impairment testing, assets that cannot be tested individually are grouped together into the smallest group of assets that generates cash inflows from continuing use that are largely independent of the cash inflows of other assets or CGU. Subject to an operating segment ceiling test, for the purposes of goodwill impairment testing, CGUs to which goodwill has been allocated are aggregated so that the level at which impairment testing is performed reflects the lowest level at which goodwill is monitored for internal reporting purposes. Goodwill acquired in a business combination is allocated to groups of CGUs that are expected to benefit from synergies of the combination. The Partnership’s corporate assets do not generate separate cash inflows and are utilised by more than one CGU. Corporate assets are allocated to CGUs on a reasonable and consistent basis and tested for impairment as part of the testing of the CGU to which the corporate asset is allocated. Impairment losses are recognised in the Statement of Comprehensive Income. Impairment losses recognised in respect of CGUs are allocated first to reduce the carrying amount of any goodwill allocated to the CGU (group of CGUs), and then to reduce the carrying amounts of the other assets in the CGU (group of CGUs) on a pro rata basis. An impairment loss in respect of goodwill is not reversed. In respect of other assets, impairment losses recognised in prior periods are assessed at each reporting date for any indications that the loss has decreased or no longer exists. An impairment loss is reversed if there has been a change in estimates used to determine the recoverable amount. An impairment loss is reversed only to the extent that the asset’s carrying amount does not exceed the carrying amount that would have been determined, net of depreciation or amortisation, if no impairment loss has been recognised. The Partnership performs impairment tests at least annually or whenever events or changes in circumstances indicate that the goodwill and intangible assets that have indefinite useful lives or are not yet in use carrying values for a business unit may not be recoverable. e) Trade and other receivables Trade and other receivables, including receivables from Merchants, are stated at their amortised cost less impairment losses and doubtful accounts. Receivable from merchants also include receivables from the sale of point-of-sale termination equipment. f) Financial liabilities The Partnership classifies its financial liabilities at fair value through profit or loss, and as other financial liabilities measured at amortised cost depending on the purpose for which the financial liabilities were acquired or incurred. Management determines the classification of its financial liabilities at the initial recognition. The Partnership’s other financial liabilities measured at amortised cost comprise ‘trade and other payables’ in the statement of financial position.

149 Trade and other payables are recognised initially at fair value and subsequently measured at amortised cost using the effective interest method. Trade and other payables are classiﬁed as current liabilities if payment is due within one year or less. If not, they are presented as non- current liabilities.

Processing liabilities Processing liabilities primarily reflect funds in transit associated with differences arising between the amounts the Partnership’s sponsor bank receive from the bankcard networks and the amounts funded to the Partnership’s merchants. Such differences arse from timing differences, interchange expense, merchant advances, merchant reserves, and chargeback processing. These differences result in payables or receivables. If the settlement received from the bankcard network precedes the funding obligation to the merchant, the Partnership records a processing liability. Conversely if funding to the merchant precedes the settlement from the bankcard networks, the Partnership records a receivable from the bankcard network. In addition, certain bankcard networks restrict the Partnership from accessing merchant settlement funds and require these funds to be controlled by the Partnership’s sponsor banks. The amounts are generally collected or paid the following business day. Chargebacks periodically arise due to disputes between cardholder and a merchant resulting from the cardholder’s dissatisfaction with merchandise quality or the merchant’s service, and the disputes may not always be resolved in merchants favour. In some of these cases, the transaction is ‘charged back’ to the merchant and the purchase price is refunded to the cardholder by the credit card issuing institution. If the merchant is unable to fund the refund, the Partnership is liable for the full amount of the transaction. The Partnership’s obligation to stand ready to perform is minimal. The Partnership maintains a merchant reserve and/or personal guarantee from certain merchants as an offset to potential contingent liabilities that are the responsibility of such merchants. The Partnership evaluates its ultimate risk and records an estimate of potential loss for chargebacks based upon an assessment of actual historical loss rates compared to recent bankcard processing volume levels. g) Revenue recognition The Partnership is involved in transaction processing services. Revenues from transaction processing services are recognised at the time services are rendered. Merchant revenue is recognised as a fee calculated as a percentage of funds processed or as a charge per transaction on behalf of Merchants. Payment processing services revenue is transaction based and priced either as a fixed fee per transaction or calculated based on a percentage of the transaction value. The fees are charged for processing services provided in facilitating the sale of goods and services by means of credit, debit and prepaid cards and other electronic payments and do not include the gross sales price paid by the ultimate buyer. Payment processing services revenue is recognized upon settlement of the merchant transaction. Revenue is presented net of a provision for sales credits, which is estimated based on historical results and established in the period in which services are provided. As of the periods presented, there were no such provisions. The Partnership charges an annual service fee to its customers. This annual service fee is recognised evenly over the period. The Partnership also sells payment processing equipment to merchants. Revenues from these sales are recorded when the equipment is shipped to the merchant. In addition, the Partnership may also from time to time lease a credit card terminal to a merchant. This lease revenue is recognised on a monthly basis when it is billed to the client. Interest income is accrued on a monthly basis, by reference to the principal outstanding and at the effective interest rate applicable. h) Partners’ capital Under the terms of the Agreement, profits and losses are to be allocated to the partners in the following order of priority: (i) first to the Partners in the amount of any profits or losses previously allocated to them; and then (ii) second to the Partners pro rata, in accordance with their percentage of ownership of the Partnership. Distributions shall be made to the partners at the

150 times and in the aggregate amounts as determined by the Partners and subject to applicable laws and any limitations contained elsewhere in the Agreement. Distributions are to be distributed to partners in the following order of priority: (i) ﬁrst to the partners, pro rata, in proportion to their unreturned capital contributions; and then (ii) second to the Partners, pro rata in proportion to their percentage of ownership of the Partnership. The General Partner has the exclusive control over the Partnership’s business and assets. The Limited Partners are entitled to vote on all matters with respect to which they are given the right to vote pursuant to law or to the Agreement. The Partnership can be dissolved by the General Partner with written consent of the Limited Partners.

(i) Leases (i) Leased assets Assets held by the Partnership under leases which transfer to the Partnership substantially all of the risks and rewards of ownership are classified as finance leases. On initial recognition, the leased asset is measured at an amount equal to the lower of its fair value and the present value of the minimum lease payments. Subsequent to initial recognition, the asset is accounted for in accordance with the accounting policy applicable to that asset. Assets held under other leases are classified as operating leases and are not recognised in the Meritus’ statement of financial position. (ii) Lease payments Payments made under operating leases are recognised in the Statement of Comprehensive Income on a straight-line basis over the term of the lease. Minimum lease payments made under finance leases are apportioned between the finance expense and the reduction of the outstanding liability. The finance expense is allocated to each period during the lease term so as to produce a constant periodic rate of interest on the remaining balance of the liability. j) Offsetting Financial assets and liabilities are set off and the net amount presented in the Statement of Financial Position when, and only when, the Partnership has a legal enforceable right to set off the amounts and intends either to settle on a net basis or to realise the asset and settle the liability simultaneously. Gross settlement is equivalent to net settlement if and only if the gross settlement mechanism has features that eliminate or result in insignificant credit and liquidity risk and processes receivables and payables in a single settlement cycle. The balances owing to the Members and merchants and the related cash balances segregated in the members and merchant’s accounts are presented net in the statement of financial position as the Partnership considered these gross settlement as equivalent to net settlement in accordance with IAS 32. Income and expenses are presented on a net basis only when permitted by the accounting standards, or for gains and losses arising from a Partnership of similar transactions such as in the Meritus’ trading activity. k) Income taxes The Partnership is a limited partnership, and as such, the Partnership does not pay federal corporate income taxes on its taxable income and is not allowed a net operating loss carryover or carryback as deduction. Instead the Partners are liable for individual income taxes on their respective share of the Partnership’s taxable income. However, the Partnership provides for state taxes for various jurisdictions that either treat the Partnership as a separate corporation or impose a franchise tax. This has been included in general and administrative expenses in the financial information. The Partnership accounts for uncertain tax positions by making assumptions and judgements regarding its income tax exposures. The application of income tax law is inherently complex. The Partnership’s policy is to recognise interest and/or penalties in the period in which they are agreed as an income tax expense. No interest of penalties were accrued at 31 December 2014, 2013 or 2012.

151 l) Application of new and revised accounting policies In the current year, the Partnership has applied a number of amendments to IFRSs and a new Interpretation issued by the International Accounting Standards Board (‘‘IASB’’) that are mandatorily effective for an accounting period that begins on or after 1 January 2014.

Amendments to IAS 32 Offsetting Financial Assets and Financial Liabilities The Partnership has applied the amendments to IAS 32 Offsetting Financial Assets and Financial Liabilities for the first time in the current year. The amendments to IAS 32 clarify the requirements relating to the offset of financial assets and financial liabilities. Specifically, the amendments clarify the meaning of ‘currently has a legally enforceable right of set-off’ and ‘simultaneous realisation and settlement’. The Partnership has assessed whether certain of its financial assets and financial liabilities qualify for offset based on the criteria set out in the amendments and concluded that the application of the amendments has had no impact on the amounts recognised in the Partnership’s financial information other than consistency of accounting policy application for restricted members cash and amounts owing to members as disclosed in the note 6.

Amendments to IAS 36 Recoverable Amount Disclosures for Non-Financial Assets The Partnership has applied the amendments to IAS 36 Recoverable Amount Disclosures for Non- Financial Assets for the first time in the current year. The amendments to IAS 36 remove the requirement to disclose the recoverable amount of a cash-generating unit (CGU) to which goodwill or other intangible assets with indefinite useful lives had been allocated when there has been no impairment or reversal of impairment of the related CGU. Furthermore, the amendments introduce additional disclosure requirements applicable to when the recoverable amount of an asset or a CGU is measured at fair value less costs of disposal. These new disclosures include the fair value hierarchy, key assumptions and valuation techniques used which are in line with the disclosure required by IFRS 13 Fair Value Measurements. The application of these amendments has had no material impact on the disclosures in the Partnership’s financial information.

Future changes to accounting standards The Partnership has not applied the following new and revised IFRSs that have been issued but are not yet effective:

IFRS 9 Financial Instruments The IASB issued IFRS 9 in November 2009, introducing new requirements for the classification and measurement of financial assets. IFRS 9 was subsequently amended in October 2010 to include requirements for the classification and measurement of financial liabilities and for de recognition, and in November 2013 to include the new requirements for general hedge accounting. Another revised version of IFRS 9 was issued in July 2014 mainly to include a) impairment requirements for financial assets and b) limited amendments to the classification and measurement requirements by introducing a ‘fair value through other comprehensive income’ (FVTOCI) measurement category for certain simple debt instruments. IFRS 9 is effective for annual periods beginning on or after 1 January 2018. It is not practicable to provide a reasonable estimate of the effect of IFRS 9 until the Partnership undertakes a detailed review.

IFRS 15 Revenue from Contracts with Customers In May 2014, IFRS 15 was issued which establishes a single comprehensive model for entities to use in accounting for revenue arising from contracts with customers. IFRS 15 will supersede the current revenue recognition guidance including IAS 18 Revenue, IAS 11 Construction Contracts and the related Interpretations when it becomes effective for annual periods beginning on or after 1 January 2017. The core principle of IFRS 15 is that an entity should recognise revenue to depict the transfer of promised goods or services to customers in an amount that reﬂects the consideration to which the entity expects to be entitled in exchange for those goods or services. Speciﬁcally, the Standard introduces a 5-step approach to revenue recognition: * Step 1: Identify the contract(s) with a customer * Step 2: Identify the performance obligations in the contract

152 * Step 3: Determine the transaction price * Step 4: Allocate the transaction price to the performance obligations in the contract * Step 5: Recognise revenue when (or as) the entity satisﬁes a performance obligation Extensive disclosures are required by IFRS 15. The directors of the Partnership do not anticipate that the application of IFRS 15 in the future will have a material impact on the amounts reported and disclosures made in the Group’s consolidated ﬁnancial information. However, it is not practicable to provide a reasonable estimate of the effect of IFRS 15 until the Partnership performs a detailed review.

Amendments to IAS 16 Property, Plant and Equipment and IAS 38 Intangible Assets The amendments to IAS 16 prohibit entities from using a revenue-based depreciation method for items of property, plant and equipment. The amendments to IAS 38 introduce a rebuttable presumption that revenue is not an appropriate basis for amortisation of an intangible asset. The amendments apply prospectively for annual periods beginning on or after 1 January 2016. Currently, the Partnership uses the declining balance method for depreciation for its property, plant and equipment, and declining balance and straight line methods for amortisation for its intangible assets. The directors of the Partnership believe that these methods are the most appropriate method to reflect the consumption of economic benefits inherent in the respective assets and accordingly, the directors of the Partnership do not anticipate that the application of these amendments to IAS 16 and IAS 38 will have a material impact on the Partnership’s financial information.

5. CASH HELD AS RESERVES The Partnership has agreements with various ﬁnancial institutions for the settlement of payment transactions. Under the terms of these agreements, the Group is required to maintain certain amounts as reserves, which may be applied against any amounts for which the ﬁnancial institutions would be entitled for reimbursement.

153 6. PROPERTY AND EQUIPMENT The Partnership had the following balances:

Machinery Furniture Leasehold and Ofﬁce and Computer Computer Improve- Equipment ﬁttings Equipment Software ments Total US$’000 US$’000 US$’000 US$’000 US$’000 US$’000

Cost As at 1 January 2012 73 — 246 400 4 723 Additions — — 102 9 — 111

As at 31 December 2012 73 — 348 409 4 834 Additions — — 51 33 3 87 Disposals (73) — (359) (409) (4) (845)

As at 31 December 2013 — — 40 33 3 76 Additions — 682 334 417 211 1,644 Disposals — — (9) (6) (3) (18)

As at 31 December 2014 — 682 365 444 211 1,702

Machinery Furniture Leasehold and Ofﬁce and Computer Computer Improve- Equipment ﬁttings Equipment Software ments Total US$’000 US$’000 US$’000 US$’000 US$’000 US$’000

Accumulated depreciation As at 1 January 2012 21 — 69 67 2 159 Charge for the year 10 — 182 172 1 365

As at 31 December 2012 31 — 251 239 3 524 Charge for the year (31) — (243) (236) (1) (511) As at 31 December 2013 — — 8 3 2 13

Charge for the year — 114 109 59 11 293 As at 31 December 2014 — 114 117 62 13 306 Net book value

As at 31 December 2012 42 — 97 170 1 310

As at 31 December 2013 — — 32 30 1 63

As at 31 December 2014 — 568 248 382 199 1,397

154 7. INTANGIBLE ASSETS The Partnership had the following balances:

Capitalized customer acquisition US$’000

Cost As at 1 January 2012 31 Additions 2

As at 31 December 2012 33 Disposals (33) As at 31 December 2013 — As at 31 December 2014 —

Accumulated amortisation As at 1 January 2012 18 Charge for the year 6

As at 31 December 2012 24 Charge for the year (24)

As at 31 December 2013 —

As at 31 December 2014 —

Net book value As at 31 December 2012 9

As at 31 December 2013 —

As at 31 December 2014 —

8. TRADE AND OTHER PAYABLES The Partnership had the following balances:

Year ended Year ended Year ended 31 December 31 December 31 December 2012 2013 2014 US$’000 US$’000 US$’000

Accounts payable and accrued expenses 1,488 2,215 2,702 Due to related parties 1,503 3,681 1,631 Processing liabilities: Merchant bankcard processing and loss reserves 1,572 1,564 3,310

4,563 7,460 7,643

Processing liabilities result primarily from the Partnership’s card processing activities and include merchant deposits maintained to offset potential liabilities from merchant chargeback processing. In addition to the merchant deposits held at the Partnership, some merchants are required to submit deposits at three sponsor banks. The Partnership does not have access to these deposits, however in the event that chargebacks or other liabilities are not covered by the merchant; these deposits can be utilized to cover any liabilities related to these merchants. The Partnership’s merchants have the liability for any charges properly reversed by the cardholder through a mechanism known as a chargeback. If the merchant is unable to pay this amount, the Partnership will be liable to the card brand networks for the reversed charges. The Partnership has

155 determined that the fair value of its obligation to stand ready to perform is minimal. The Partnership requires personal guarantees and merchant deposits from certain merchants to minimize its obligation. The card networks generally allow chargebacks up to six months after the later of (1) the date the transaction is processed or (2) the delivery of the product or service to the cardholder. The loss recorded by the Partnership for chargebacks associated with any individual merchant is typically small, due both to the relatively small size and the processing proﬁle of the Partnership’s merchants. However, from time to time the Partnership will encounter instances of merchant fraud, and the resulting chargeback losses may be considerably more signiﬁcant to the Partnership.

9. PARTNERS’ CAPITAL

Year ended Year ended Year ended 31 December 31 December 31 December 2012 2013 2014 US$ US$ US$

As at 1 January 1,826 2,239 1,679 Proﬁt for the year 723 1,090 6,709 Distribution to partners (310) (1,650) (1,600)

As at 31 December 2,239 1,679 6,788

10. COMMITMENTS At the year end date, the Partnership had outstanding commitments for future minimum lease payments, which fall due as follows:

Year ended Year ended Year ended 31 December 31 December 31 December 2012 2013 2014 US$’000 US$’000 US$’000

Within one year 172 99 433 In the second to ﬁfth years inclusive 70 0 2,474 After ﬁve years 0 1,679 6,788

11. FINANCIAL INSTRUMENTS – FAIR VALUES AND RISK MANAGEMENT Financial instruments consist of cash and cash equivalents, restricted Meritus Merchant cash, qualifying liquid assets held for Meritus Members, trade and other receivables, payable to Meritus Members, and trade and other payables. All financial instruments are classified as loans and receivables. The Group manages its capital structure through a combination of debt and equity financing, to enable it to meet operational needs on a day-to-day basis and also operate as required.

(i) Fair values The Partnership estimates the fair value of its financial instruments based on current interest rates, market value and pricing of financial instruments with comparable terms. The fair values of cash and cash equivalents, restricted Meritus Merchant cash, trade and other receivables, payable to Meritus Members and trade and other payables approximate the carrying values due to the short-term nature of these instruments. The fair value of the obligations under finance lease as at 31 December 2014 has been established by discounting the future cash flows using interest rates corresponding to those which the Partnership would currently be able to obtain for leases with similar maturity dates and terms.

(ii) Credit risk and concentrations Credit risk is the risk of ﬁnancial loss to the Partnership if a member or merchant counter party to a ﬁnancial instrument fails to meet its contractual obligations, and arises principally from the Partnership’s cash and cash equivalents, restricted Meritus merchant cash and trade and other

156 receivables. The cash and cash equivalents and restricted Meritus merchant cash are deposited with major financial institutions which the Partnership’s management believes to be financially sound and, accordingly, minimal credit risks exist with respect to these assets. The Partnership is exposed to credit risk to the extent that its members and merchants may charge back credit card purchases. The Partnership manages the exposure to credit risk by employing various online identification verification techniques, enacted transaction limits and having a significant number of members and merchants. As these members are geographically widespread and the merchants are active in various industries, the exposure to credit risk and concentration is mitigated.

(iii) Interest rate risk The Partnership is exposed to interest rate risk to the extent that investment revenue earned on cash and cash equivalents and client account funds is subject to fluctuations in interest rates. The Partnership’s exposure to interest rate risk is limited as investments are held in liquid and short- term funds. The Partnership has no significant debt arrangements and as such the General Partners consider there is no significant exposure to interest rate risk.

(iv) Currency risk The Partnership’s functional currency is US dollars, reﬂecting the primary currency in which all transactions are undertaken. As such the Directors’ consider that there is no material exposure to currency risk.

(v) Market segment risk Market segment risk may arise due to adverse changes in legislation relating to internet, payment processing or on-line gambling. The Partnership is exposed to market segment risk to the extent that legislation impacts operational presence and related revenue streams, which may be signiﬁcant. The Partnership manages this exposure through geographical diversiﬁcation. The Partnership closely monitors local legislation in key markets (new or existing) and does not have economic reliance on any one country.

(vi) Liquidity risk Liquidity risk is the risk that the Partnership will be unable to meet its financial obligations as they fall due. Management controls and monitors the Partnership’s cash flow on a regular basis, including forecasting future cash flows. The Partnership’s objective to managing liquidity is to ensure that, as far as possible, that it will always have sufficient liquidity to meet the liabilities when they become due. The Group maintains significant cash balances in respect of this and actively forecasts cashflows on a rolling basis.

12. RELATED PARTIES i) At 31 December 2014, amounts due to related parties totalled $1,680,899 (2013: $3,680,899; 2012: $1,502,999). These amounts due to related parties are comprised of the following:

Year ended Year ended Year ended 31 December 31 December 31 December 2012 2013 2014 US$000 US$000 US$000

Commissions payable to commonly controlled entities 1,499 3,481 1,631 Other payables to partners 4 200 0

1,503 3,681 1,631

For the year ended 31 December 2014 total commissions accrued to related parties were $3,600,000 (2013: $6,007,162; 2012: $2,537,112). However, per the agreement with these entities, monthly disbursements are at the discretion of the ﬁnance department, based on cash ﬂow needs. The actual payments to these entities for the year ended 31 December 2014 totalled $3,500,000 (2013: $5,850,000; 2012: $2,237,241).

157 The Partnership makes payments into irrevocable trusts, the beneﬁciary of which is the Partnership. The trusts were established to assure the wherewithal to satisfy: a) claims made by one or more banks, lenders, or other ﬁnancial institutions with which the Partnership transacts business; and/or b) claims for chargebacks that are not covered by merchants. The trusts operate completely separately from the Partnership, and the trustees have the legal power to deny any request for distribution from the Partnership. The Partnership does not have the access to the trust assets, and the Partnership does not control the appointment of trustees. For the year ended 31 December 2014 total expenses of $3,900,000 (2013: $4,378,369; 2012: $1,628,705), were recorded in general and administrative expenses in the accompanying statements of operations. At 31 December 2014 the Partnership had amounts due to the trust totalling $0 (2013: $14,795; 2012: $0) which is included in accounts payable and accrued expenses in the accompanying balance sheet.

13. CONTINGENT LIABILITIES From time to time the Partnership is subject to routine legal claims and actions in the normal course of its business. The Partnership takes legal advice as to the likelihood of success of the claims and actions and no provision or disclosure is made where the Directors feel, based on that advice, the action is unlikely to result in a material loss or a sufﬁciently reliable estimate of the potential obligation cannot be made. As at 31 December 2014 no provision is made for legal claims (2013: none, 2012: none). The Partnership collects and stores sensitive data about its merchant customers and bankcard holders. If the Partnership’s network security is breached or sensitive merchant or cardholder data is misappropriated, the Partnership could be exposed to assessments, ﬁnes or litigation costs. Management is not aware of any such breaches as of 31 December 2014 (2013: none, 2012: none).

14. SUBSEQUENT EVENTS One of TK Global Partners, LP, a Paysafe subsidiary acquiring contracts was not renewed between the parties. The monthly revenue derived from the contract with the third party card payment processor averaged approximately US$2.0 million. TK Global Partners, LP is entering into an agreement with a new card payment processor and will migrate its merchant accounts to an existing processor as well as the new payment processor.

158 PART V

OPERATING AND FINANCIAL REVIEW OF THE SKRILL OPERATING GROUP

The following is a discussion of the Skrill Operating Group’s financial condition and results of operations for the periods under review. This discussion should be read in conjunction with Part VI (Financial Information of the Skrill Group) and the consolidated financial statements and the related notes for the Skrill Operating Group for the years ended and as at 31 December 2013 and 2012 which are set out on pages 238 to 451 of the March 2015 Prospectus and are incorporated by reference into this document. See Part XII (Information Incorporated by Reference) of this document for further details about information that has been incorporated by reference into this document. The consolidated financial statements and the related notes for the Skrill Operating Group for the six months ended and as at 30 June 2015 and the years ended and as at 31 December 2014, 2013 and 2012 have been prepared in accordance with IFRS as adopted for use in the EU. The following discussion and elsewhere in this document includes forward-looking statements that reflect the Skrill Operating Group’s plans, estimates and beliefs, and involve risks and uncertainties. Actual results and the timing of events could differ materially from those expressed or implied by such forward looking statements as a result of various factors, particularly those discussed in the section entitled ‘‘Risk Factors’’ and the paragraph relating to forward-looking statements in the section entitled ‘‘Important Information’’.

1. OVERVIEW The Skrill Operating Group is a leading worldwide provider of electronic money transfer services, online prepaid solutions and software development, allowing customers and merchants to exchange funds in real time across a broad and innovative product set. The Skrill Operating Group comprises Skrill, paysafecard, Payolution and Ukash. The Skrill Operating Group processes internet payments through a network of over 80 banks and payment providers with whom the Skrill Operating Group has a business relationship, offering over 100 local payment options in more than 200 countries and territories, across over 40 currencies and 16 languages. The Skrill Operating Group offers the following products:

Skrill Skrill’s principal product is the e-Wallet, an internet-based account established by merchants and customers and maintained by the Skrill Operating Group. In order to use the e-Wallet, customers may be charged a fee when uploading funds into their e-Wallet accounts. Additional charges apply when customers transfer funds out of their e-Wallets. Customers are also charged foreign exchange fees and an additional service fee when funds are transferred in a different currency from the source currency of the e-Wallet. Skrill’s e-Wallet also allows customers to receive money from merchants, such as winnings from an internet-based gambling website or payments from an auction website. Merchants are charged a ﬁxed percentage fee when accepting payments made using the e-Wallet. The fee is agreed in advance with each merchant and is dependent on the merchant’s transaction volume, its industry and whether or not the merchant is eligible for and opts for the Skrill Operating Group’s no chargeback policy. Merchants are also charged foreign exchange fees and an additional service fee when funds are transferred in a different currency from the source currency of the e-Wallet. As at 30 June 2015 and 31 December 2014 respectively, Skrill had over 45.6 million and 44.3 million registered e-Wallet customers, and over 175,900 and over 170,000 registered e-Wallet merchants, with over 1.5 million active e-Wallet customers and over 29,500 active e-Wallet merchants actively making and receiving payments during H1 2015. As at 30 June 2015 61 per cent. of the Skrill Operating Group’s active customers by number were located in Europe, 27 per cent. in the Americas and 12 per cent. in the rest of the world. The Skrill Operating Group offers a digital wallet, payment gateway services by way of Skrill Quick Checkout, Direct Payment Gateway and Skrill 1-Tap, payment services through Skrill Direct and Peer-to-Peer (‘‘P2P’’) Remittance, foreign exchange services and is a payment service provider (‘‘PSP’’).

159 paysafecard paysafecard is a prepaid payment voucher (‘‘paysafecard’’) and an online payment account (‘‘my paysafecard’’) issued and operated through a UK e-money licence and local licenses or approvals outside the EEA. paysafecard processed approximately e961 million and e1.7 billion in transactions in H1 2015 and FY2014 respectively. In addition, paysafecard offers a Prepaid Mastercardâ under the license of MasterCard International Incorporated. paysafecard derives its revenues from fees charged to merchants accepting payments made using the paysafecard product. A portion of the fees paid by merchants is used by paysafecard to pay commissions to sales outlets that stock and sell paysafecard vouchers, with the balance being retained by paysafecard. Due to the commission costs, paysafecard has a naturally lower margin than other products within the Skrill Operating Group portfolio. On 31 March 2015, the Skrill Operating Group completed the acquisition of the entire issued share capital of Ukash. Ukash is an online e-money payment provider that allows customers to exchange their cash for a secure code to make payments online without the use of a credit or debit card. Ukash previously offered the Ukash Prepaid MasterCardâ and Ukash Travel Money Prepaid MasterCardâ, which is now closed to new business.

Payolution Payolution arranges the provision of point-of-sale ﬁnancing to customers of e-commerce merchants in order to ensure that the merchants are put in funds within an agreed timeframe (which is within 29 days after merchants are provided with a statement of its transactions) and is offered as a white-label solution.

PRINCIPAL FACTORS AFFECTING RESULTS OF OPERATIONS AND FINANCIAL CONDITION The Skrill Operating Group’s results of operations have been affected by a number of factors including the factors discussed below, which have inﬂuenced the Skrill Operating Group’s results of operations in the periods under review and/or will likely continue to affect its business and industry.

Ukash Acquisition On 31 March 2015, the Skrill Operating Group completed the acquisition of 100 per cent. of the issued share capital of Smart Voucher Limited (‘‘Ukash’’). The results of Ukash have been incorporated into the results for the Skrill Operating Group since this date of acquisition.

Acquisition of paysafecard On 28 June 2012, the Skrill Operating Group entered into an agreement to acquire 100 per cent. of the issued share capital of paysafecard.com Wertkarten AG (‘‘paysafecard’’), an Austrian prepaid payments business. Formal closing of the transaction occurred on 8 February 2013, once clearance was received from the FCA as well as the relevant merger control authorities. The full year 2014 and full year 2013 results therefore include paysafecard group results since the date of acquisition (revenues of US$146 million and proﬁt after tax of US$21 million in 2013 and revenues of US$184 million and proﬁt after tax of US$34.7 million in 2014).

Approval in New Jersey, USA to offer digital Wallet services for online gambling In November 2013, Skrill USA, Inc. was approved by the New Jersey Division of Gaming Enforcement (‘‘DGE’’) to offer its digital Wallet for regulated gambling in the state of New Jersey. Skrill USA Inc. operates in a large majority of the US states, the District of Columbia and its territories on the basis of money transmitter licences in the US states where it is required. Skrill USA, Inc. has been granted a waiver from the requirement to obtain a money transmitter licence in Wisconsin and money transmitter licences are not required in Montana, New Mexico and South Carolina.

Growth of the digital payments industry The Skrill Operating Group operates in the high growth digital payments industry. The core market comprises the provision of services which enable merchants and customers to make and accept payments over the internet. The results of operations are therefore dependent on the adoption of the digital payments model by merchants and customers.

160 The digital payments industry has demonstrated signiﬁcant growth across geographies during the period under review and is expected to continue to do so, while increasing internet penetration is a key driver behind the industry’s growth. This includes an increasing number of ‘‘bricks-and-mortar’’ merchants shifting their sales channels to focus on the internet, given the inherent cost and distribution advantages of selling goods and services this way. Other industry drivers include the growth of online gaming, VoIP communications, micropayments, internet-based remittances, virtual goods and the emergence of mobile internet-enabled devices. Going forward, the growth of the Skrill Operating Group’s business in the medium to long term will depend, in part, on continued industry growth and its ability to remain competitive in this evolving industry.

Seasonality and sports schedules The Skrill Operating Group derives a portion of its gambling related revenue from online sports betting. Revenue, therefore, is generally subject to the same seasonal factors which affect the amounts and numbers of bets placed with sports betting merchants, including the scheduling of sporting events and, in particular, the scheduling of football events. Seasons for the premier European football leagues run from mid-August to mid-May. During June and July, the Skrill Operating Group’s revenue typically decreases in line with the break between football seasons. Similarly, revenue is affected by the scheduling of signiﬁcant football events during the off-season, including the FIFA Football World Cup and the UEFA European Football Championship. The FIFA Football World Cup held in June and July 2014 had a positive impact on revenue for 2014. In addition to sports schedules, revenue can also be impacted by the seasonality of retail e- commerce trends, for example, increased online shopping activity during the Christmas holiday season. During the period under review, the seasonality of retail e-commerce trends did not signiﬁcantly impact the Skrill Operating Group’s revenue. However, going forward, if the Skrill Operating Group continues to diversify its revenue and grow its e-commerce presence, the impact of such seasonal trends on the Skrill Operating Group’s results may increase.

Legal and regulatory developments Online gambling is the newest and fastest growing part of the world gambling industry and the regulatory environment to which the online gambling industry is subject is in a state of constant development. The regulation and legality of online gambling varies significantly from jurisdiction to jurisdiction as a variety of jurisdictions seek to regulate and tax gambling transactions and such laws and regulations are subject to conflicting interpretations. Some jurisdictions have sought to prohibit online gambling in its entirety. The global online gambling market is characterised by regulatory inconsistency across many jurisdictions and frequent changes in the regulations governing online gambling. Given the importance of the online gambling sector to the business of the Skrill Operating Group, it expends significant time and resource to ensure that it has an in-depth understanding of the regulatory environment in the main territories in which their gambling industry merchants and customers operate, monitoring closely the developing regulatory regimes in those territories and adapting their own business acceptance policies where necessary.

161 KEY PERFORMANCE METRICS In evaluating the Skrill Operating Group’s results of operations, the Skrill Directors refer to a number of key ﬁnancial measures, including those from the Skrill Operating Group’s IFRS results of operations discussed in paragraph 5 of this Part V (Operating and Financial Review of the Skrill Operating Group), as well as EBITDA, a non-IFRS measure used to evaluate the Skrill Operating Group’s performance. The most important are revenue, gross margin and earnings before interest, tax, depreciation, amortisation and non-recurring costs (‘‘Adjusted EBITDA’’).

Six month period ended 30 June Year ended 31 December

2015 2014 2014 2013(1) 2012

(Reported on) (Audited) (US$ million) Revenue 173.3 168.0 337.1 286.4 129.9 Gross proﬁt 103.1 100.2 202.7 170.4 91.1 Gross proﬁt margin 59% 60% 60% 59% 70% EBITDA 35.5 34.3 81.8 63.6 38.0 Adjusted EBITDA(2)(3) 43.2 41.9 91.5 76.8 43.0

(1) 2013 includes 11 months of paysafecard results (from the date of acquisition) (2) 2014, 2013 and 2012 stated after non-recurring costs of US$9.7 million, US$13.2 million and US$5.0 million respectively. (3) Please see paragraph 7 of Part A and paragraph 7 of Part C of Part XI (Financial Information of the Skrill Group) of the March 2015 Prospectus which has been incorporated by reference into this document] for more information on calculation of EBITDA and Adjusted EBITDA. Please also see Section D of Part VI (Financial Information of the Skrill Group). The following operational metrics are also part of the Skrill Operating Group’s key performance indicators:

30 June 31 December

2015 2014 2014 2013 2012

Number of registered e-Wallet merchants (thousands) 175.9 167.1 169.9 162.9 145.0 Number of registered e-Wallet customers (millions) 45.7 42.1 44.3 39.5 32.2 Number of active web-shops – paysafecard (thousands) 1.9 1.7 1.8 1.4 n.a Number of registered e-Wallet merchants The number of merchants is a count of merchants registered with the Skrill Operating Group, whereby the customer has been deemed to be a merchant and has completed the appropriate validation checks by the date of the relevant period end. Where a merchant has more than one account for a given merchant identity, the merchant is counted only once. Once opened, an account is never closed (unless requested by a merchant).

Number of registered e-Wallet customers The number of customers is a cumulative count of all customers that have ever registered with Skrill Operating Group as at the date of the relevant period end. These relate to the Skrill Digital Wallet business.

Number of active web-shops – paysafecard The number of active web-shops is a count of all merchants at which there is at least one redemption in the month. These relate to the paysafecard business.

162 Revenue by key business lines Merchant revenue Revenue from merchants is primarily comprised of receive money fees, per transaction fees, upload fees (where the Skrill Operating Group incurs a charge for the upload), send money fees and redemption fees.

Consumer revenue Revenue from customers is primarily comprised of upload fees, send money fees, redemption fees, service fees and Prepaid MasterCard fees.

Financial revenue Financial revenue includes mostly foreign exchange spread income and interest income from own funds and funds held on behalf of customers.

EBITDA EBITDA is a non-IFRS measure and may not be comparable to similarly titled measures presented by other companies in the industry or otherwise. Nevertheless, the Skrill Operating Group’s management believe that this measure is important to understand performance from period to period and to assist with the evaluation of growth trend and preparation of budgets.

Cost of sales The components of cost of sales varies among the Skrill Operating Group’s major products. For e- Wallet, cost of sales mainly comprise variable transaction processing fees, promotions, referral bonuses and bad debt expenses. paysafecard cost of sales mainly comprise volume based commissions paid to distribution partners (such as retailers, convenience stores and petrol stations) and cost of materials relating to prepaid vouchers. For Payolution, cost of sales mainly comprise transaction processing fees and bad debt expenses. Transaction processing fees are primarily in respect of third-party charges (primarily acquiring bank, credit card, PSP and retail bank charges) for uploading and withdrawal of funds, including e- Wallet uploads using credit cards. Bad debt expenses arise from charge backs payable for those merchants with a chargeback policy and reflect unauthorised credit card and bank account usage, unauthorised payments and the non- performance of merchants, as well as any specifically identified bad debts.

Sales and marketing expenses Sales and marketing expenses primarily comprise salaries in respect of sales and marketing staff and external marketing costs, including traditional and online advertising.

Administrative expenses Administrative expenses primarily comprise general overhead and IT costs and related salary and property expenses, as well as foreign currency gains and losses. Administrative expenses also include depreciation and amortisation.

Gross profit margin Gross profit is calculated as revenue less cost of sales. Gross profit margin is calculated as gross profit divided by revenue.

CURRENT TRADING / RECENT DEVELOPMENTS In the period since 30 June 2015, the Skrill Operating Group has continued to trade in line with management expectations.

163 RESULTS OF OPERATIONS The following table shows the Skrill Operating Group’s consolidated statement of comprehensive income for the periods indicated.

Six month period ended 30 June Year ended 31 December

2015 2014 2014 2013 2012

(Reported on) (Audited) (US$ million) Revenue Merchant revenue 128.7 124.7 250.2 212.0 83.6 Consumer revenue 25.6 23.8 47.7 36.4 11.5 Financial revenue 19.0 19.5 39.2 38.0 34.8

173.3 168.0 337.1 286.4 129.9 Cost of sales (70.2) (67.8) (134.4) (116.0) (38.8)

Gross proﬁt 103.1 100.2 202.7 170.4 91.1 Sales and marketing expenses (24.9) (24.4) (46.5) (38.5) (14.4) Administrative expenses (54.5) (53.3) (98.9) (87.9) (47.4)

Operating proﬁt 23.7 22.5 57.3 44.0 29.3 Finance income — — — 0.1 0.4 Finance costs (8.0) (9.0) (24.8) (12.0) (7.4)

Proﬁt for the year before tax 15.7 13.5 32.5 32.1 22.3

Income tax expense (1.0) (2.2) (0.8) (6.0) (6.8)

Proﬁt for the period 14.7 11.3 31.7 26.1 15.5

Proﬁt attributable to: Owners of the parent 14.7 11.3 31.7 26.1 15.6 Non-controlling interests — — — — (0.1)

Other comprehensive income Change in value of available for sale ﬁnancial assets (0.1) — (0.5) (0.5) — Exchange differences on translation of foreign operations 1.1 — 0.7 (0.2) (0.2) Cash ﬂow hedge — 0.7 0.7 0.8 (1.5)

Total comprehensive income for period 15.7 12.0 32.6 26.2 13.8

Total comprehensive income for year attributable to:

Owners of the parent 15.7 12.0 32.6 26.2 13.9

Non-controlling interests — — — — (0.1)

Six months ended 30 June 2015 compared to six months ended 30 June 2014 a) Revenue The Skrill Operating Group’s revenue in the six month period ended 30 June 2015 was US$173.3 million, an increase of US$5.3 million, or 3.2 per cent., over revenue of US$168.0 million in the six month period ended 30 June 2014.

164 This primarily reﬂected increased contributions from Skrill of US$9.4 million and Payolution of US$2.1 million and decreased contributions from paysafecard of US$6.2 million. b) Cost of sales Cost of sales in the six month period ended 30 June 2015 were US$70.2 million, an increase of US$2.4 million, or 3.5 per cent., over the six month period ended 30 June 2014. Cost of sales increased slightly to 40.5 per cent. of revenue in the six month period 30 June 2015, as compared to 40.4 per cent. for the six month period ended 30 June 2014. Bad debt expenses in the six month period ended 30 June 2015 were US$6.6 million, an increase of US$3.8 million over the six month period ended 30 June 2014. This reﬂected increased volumes, adjustments to risk model parameters for the purpose of reducing ‘‘false positives’’ and to increase conversions at merchant checkout, and certain one-off items. c) Sales and marketing expenses Sales and marketing expenses in the six month period ended 30 June 2015 were US$24.9 million, an increase of US$0.5 million, or 2.0 per cent., over the six month period ended 30 June 2014. This increase was primarily attributable to the sponsorship of a German football club.

Administrative expenses Administrative expenses in the six month period ended 30 June 2015 were US$54.5 million, an increase of US$1.2 million, or 2.3 per cent., over the six month period ended 30 June 2014. This primarily reflected increases in recruitment costs and investment in personnel. d) Operating profit Operating profit in the six month period ended 30 June 2015 was US$23.7 million, an increase of US$1.2 million, or 5.3 per cent., over US$22.5 million in the six month period ended 30 June 2014. The operating margin was 13.7 per cent. of revenue in the six month period ended 30 June 2015, an increase of 0.3 percentage points from 13.4 per cent. in the six month period ended 30 June 2014, primarily reflecting an increase in Skrill Operating Group’s revenue and an efficient management of operating costs. e) Finance income Finance income in the six month period ended 30 June 2015 was less than US$0.01 million, remaining unchanged from the six month period ended 30 June 2014. Finance income relates to finance income on bank deposits and hence varies depending on the Directors’ decision on the allocation of liquid funds. f) Finance costs Finance costs in the six month period ended 30 June 2015 were US$8.0 million, a decrease of US$1.0 million from US$9.0 million in the six month period ended 30 June 2014. This was attributable to a change in the structure of the loans. Financial indebtedness is further discussed below. g) Income tax expense Income tax expense in the six month period ended 30 June 2015 was US$1.0 million, a decrease of US$1.2 million over the six month period ended 30 June 2014 of US$2.2 million. This primarily reflected a release of an earlier tax provision. h) Profit for the period after tax Profit for the period after tax (without adjusting for non-recurring costs) for the six month period ended 30 June 2015 was US$14.7 million, an increase of US$3.4 million, or 30.1 per cent., over US$11.3 million in the six month period ended 30 June 2014, as a result of the factors discussed above.

165 i) Total comprehensive income Total comprehensive income for the six month period ended 30 June 2015 was US$15.7 million, an increase of US$3.7 million, or 30.8 per cent., over US$12.0 million in the six month period ended 30 June 2014. Other comprehensive income for the six month period ended 30 June 2015 included a US$1.1 million proﬁt relating to exchange differences on translation of foreign operations.

Year ended 31 December 2014 compared to 31 December 2013 a) Revenue The Skrill Operating Group’s revenue in the 2014 financial year was US$337.1 million, an increase of US$50.7 million or 17.7 per cent. over revenue of US$286.4 million in the 2013 financial year. This primarily reflected increased contributions from paysafecard of US$37.5 million, Skrill of US$7.0 million and Payolution of US$4.4 million, as well as a FX benefit of US$1.8 million, partly offset by lower FX income and lower interest income due to lower yields on cash balances. b) Cost of sales Cost of sales in the 2014 financial year were US$134.4 million, an increase of US$18.4 million or 15.9 per cent. over the 2013 financial year. Cost of sales represented 39.9 per cent. of revenue in the 2014 financial year, which was broadly consistent with the 2013 financial year (40.5 per cent.). Volume based commissions paid to distribution partners (such as retailers, convenience stores, and petrol stations) represented US$15.9 million of the US$18.4 million increase in cost of sales. Bad debt expenses in the 2014 financial year were US$7.5 million, an increase of US$1.5 million over the 2013 financial year. This reflected increased volumes, adjustments to risk model parameters for the purpose of reducing ‘‘false positives’’ and to increase conversions at merchant checkout, and certain one-off items. c) Sales and marketing expenses Sales and marketing expenses in the 2014 financial year were US$46.5 million, an increase of US$8.0 million or 20.8 per cent. over the 2013 financial year. This increase was primarily attributable to increased investment in sales and marketing resources, higher advertising and promotions in connection with the FIFA World Cup and sponsorship of a German football club. d) Administrative expenses Administrative expenses in the 2014 financial year were US$98.9 million, an increase of US$11.0 million or 12.5 per cent. over the 2013 financial year. This reflected investment in people primarily senior management at Group level. e) Operating profit Operating profit in the 2014 financial year was US$57.3 million, an increase of US$13.3 million or 30.2 per cent. over US$44.0 million in the 2013 financial year. The operating margin was 17.0 per cent. of revenue in the 2014 financial year, an increase of 1.6 percentage points from 15.4 per cent. in the 2013 financial year, primarily reflecting better cost management. The operating margin in the 2014 financial year was adversely affected by non-recurring costs of US$9.7 million, mainly related to acquisition costs related to CVC’s acquisition of Skrill. This compared to non-recurring costs of US$13.2 million in the 2013 financial year. f) Finance income Finance income in the 2014 financial year was US$0.01 million, a decrease of US$0.06 million from the 2013 financial year. Finance income relates to finance income on bank deposits and hence varies depending on the Directors’ decision on the allocation of liquid funds.

166 g) Finance costs Finance costs in the 2014 financial year were US$24.8 million, an increase of US$12.8 million over US$12.0 million in the 2013 financial year. This was attributable to an increase in the underlying debt arising from CVC’s acquisition of Skrill plus the write off of issue costs of US$7.0 million. Financial indebtedness is further discussed below. h) Income tax expense Income tax expense in the 2014 financial year was US$0.8 million, a decrease of US$5.2 million over the 2013 financial year. This primarily reflected tax relief on loan interest payments. The main rate of corporation tax in the UK reduced from 23 per cent. to 21 per cent. with effect from 1 April 2014. Accordingly, profits for the financial year 2014 were taxed at an effective rate of 2.3 per cent. i) Profit for the year after tax Profit for the year after tax (without adjusting for non-recurring costs) for the 2014 financial year was US$31.7 million, an increase of US$5.6 million or 21.5 per cent. over US$26.1 million in the 2013 financial year, as a result of the factors discussed above. j) Total comprehensive income Total comprehensive income for the 2014 financial year was US$32.6 million, an increase of US$6.4 million or 24.4 per cent. over US$26.2 million in the 2013 financial year. Other comprehensive income for the 2014 financial year included a US$0.7 million profit on a cash flow hedge relating to the interest rate swap described below.

Year ended 31 December 2013 compared to year ended 31 December 2012 a) Revenue The Skrill Operating Group’s revenue in the 2013 financial year was US$286.4 million, an increase of US$156.5 million or 120.5 per cent. over the 2012 financial year revenue of US$129.9 million. This primarily reflected the acquisition of paysafecard, for which formal closing of the transaction occurred on 8 February 2013. The 2013 financial year includes US$146 million of paysafecard revenues. As a result of the acquisition of paysafecard, whilst revenue from each territory grew between financial year 2012 and financial year 2013, the overall geographical mix of revenues (excluding financial revenue) within the Skrill Operating Group’s key reported segments (UK, Europe, Americas and Rest of World) shifted significantly to Europe (69.9 per cent. in financial year 2012, 85.3 per cent. in financial year 2013) where paysafecard is most active. Beyond the paysafecard acquisition, revenue growth reflected an increase in both the number of customers (from 32.2 million at 31 December 2012 to 39.5 million at 31 December 2013, an increase of 22.7 per cent.) and merchants (from 145,000 to 162,900 during the same period, an increase of 12.3 per cent.), which drove higher transaction volumes. Financial revenue in the 2013 financial year was US$38.0 million, an increase of US$3.2 million or 9.2 per cent. over the financial revenue of US$34.8 million in the 2012 financial year, primarily driven by an increase in interest rates towards the middle of 2012. The rate increases related primarily to fees received from non-VIPs. In November 2013 the Skrill Operating Group again increased its fees charged to non-VIPs. b) Cost of sales Cost of sales in the 2013 financial year was US$116.0 million, an increase of US$77.2 million or 199.0 per cent. over financial year 2012. Cost of sales represented 40.5 per cent. of the 2013 financial year revenue, an increase of 10.6 percentage points over the US$14.4 million in 2012 financial year (29.9 per cent.). The increase directly relates to paysafecard which has a higher cost of sales than the Skrill Digital Wallet platform due to volume based commissions paid to distribution partners (such as retailers, convenience stores and petrol stations) and costs of materials relating to prepaid vouchers. The increase represented US$73.4 million of the US$77.2 million increase in cost of sales).

167 Despite the increase in transaction volumes and number of customers and merchants, bad debt expenses remained unchanged at US$4.1 million between the 2012 financial year and the 2013 financial year. This reflected an ongoing focus on anti-fraud management and merchant acceptance procedures. c) Sales and marketing expenses Sales and marketing expenses in the 2013 financial year were US$38.5 million, an increase of US$24.1 million or 167.4 per cent. over the 2012 financial year. This primarily reflected the acquisition of paysafecard, together with continuing investment by the Skrill Operating Group in the growth of its business through increased headcount of sales and marketing staff, including senior account managers hired to promote business development. d) Administrative expenses Administrative expenses in the 2013 financial year were US$87.9 million, an increase of US$40.5 million or 85.4 per cent. over US$47.4 million in the 2012 financial year. Administrative expenses represented 30.7 per cent. of revenue in the 2013 financial year, a decrease of 5.8 percentage points from 36.5 per cent. in the 2012 financial year. Beyond the acquisition of paysafecard, this primarily reflected scale benefits within the Skrill Operating Group as revenue increased in excess of the cost base. e) Operating profit Operating profit for the 2013 financial year was US$44.0 million, an increase of US$14.7 million or 50.2 per cent. over US$29.3 million in the 2012 financial year. The operating margin was 15.4 per cent. of revenue in the 2013 financial year, a decrease of 7.2 percentage points from 22.6 per cent. in the 2012 financial year, primarily reflecting the impact of paysafecard’s higher cost of sales base discussed above. However, the operating margin in the 2013 financial year was adversely affected by non-recurring costs of US$13.2 million, mainly related to integration costs as a result of the acquisition of paysafecard and severance costs due to restructuring. This compared to non-recurring costs of US$5.0 million in the 2012 financial year. f) Finance income Finance income in the 2013 financial year was US$0.1 million, a decrease of US$0.3 million over the 2012 financial year of US$0.4 million. Finance income relates to finance income on bank deposits and hence varies depending on the Directors’ decision on the allocation of liquid funds. g) Finance costs Finance costs in the 2013 financial year were US$12.0 million, an increase of US$4.6 million over the 2012 financial year of US$7.4 million. This reflected a US$2.6 million (45.9 per cent.) increase in interest on bank borrowings to US$8.4 in the 2013 financial year over US$5.8 million in the 2012 financial year as total bank borrowings increased to US$143.5 million from US$97.4 million. Financial indebtedness is further discussed below. h) Income tax expense Income tax expense in the 2013 financial year was US$6.0 million, a decrease of US$0.8 million over the 2012 financial year of US$6.8 million. This primarily reflected the release of a tax overprovision of US$1.6 million. The main rate of corporation tax in the UK reduced from 24 per cent. to 23 per cent. with effect from 1 April 2013. Accordingly, profits for the financial year 2013 were taxed at an effective rate of 18.6 per cent. i) Profit for the year after tax Profit for the year after tax (without adjusting for non-recurring costs) for the 2013 financial year was US$26.1 million, an increase of US$10.6 million or 68.4 per cent. over US$15.5 million in the 2012 financial year, as a result of the factors discussed above.

168 j) Total comprehensive income Total comprehensive income for the 2013 financial year was US$26.2 million, an increase of US$12.4 million or 89.9 per cent. over US$13.8 million in the 2012 financial year. Other comprehensive income in the 2013 financial year included a loss on available for sale financial assets (relating to minority investments) of US$0.5 million. The Skrill Operating Group’s cash flow hedge relates to an interest rate swap. In the 2013 financial year and the 2012 financial year, the variable interest rate was based on 3 month EURIBOR and varied from 0.2930 to 0.1320 during 2013, and from 0.9340 per cent. to 0.2690 per cent. during 2012.

LIQUIDITY AND CAPITAL RESOURCES General The Skrill Operating Group’s liquidity requirements arise principally from operating activities, its working capital requirements (including safeguarding merchant and consumer monies in line with its regulatory obligations) and capital expenditure. The Skrill Operating Group’s obligations for these requirements are mainly met by the cash generated from operations. As at 30 June 2015, the Skrill Operating Group held a number of ﬁnancing facilities (see below). As part of the Skrill Acquisition, all shareholder loan notes of the Skrill Operating Group to Sentinel Group Holdings S.A. were redeemed, the preference shares were sold to Netinvest Limited, and all outstanding amounts under the existing Skrill Senior Facilities Agreement were fully repaid. New shareholder loan notes were then issued by the Skrill Operating Group to a Paysafe Group company.

Cash ﬂows The following table sets out summary cash ﬂow information of the Skrill Operating Group for the periods indicated: Six month period ended 30 June Year ended 31 December

2015 2014 2014 2013 2012

(Reported on) (Audited) (US$ million) Net cash generated by operating activities 8.9 224.3 193.6 66.2 102.5 Net cash generated by (consumed in) investing activities 0.3 (86.3) (95.1) 8.5 19.5 Net cash generated by (consumed in) ﬁnancing activities 33.2 (152.0) 4.8 33.2 (5.5)

Net increase/(decrease) in cash and cash equivalents 42.4 (14.0) 103.3 107.9 116.5

Cash and cash equivalents at the beginning of the period 677.0 647.0 647.0 514.5 388.9 Effect of movement in foreign exchange on cash and cash equivalents held (58.1) (4.7) (73.3) 24.6 9.1

Cash and cash equivalents at the end of the period 661.3 628.3 677.0 647.0 514.5

Six month period ended 30 June 2015 compared to six month period ended 30 June 2014 Net cash generated by operating activities was US$8.9 million in the six month period ended 30 June 2015, a decrease of US$215.4 million from the net cash generated by operating activities of US$224.3 million in the six month period ended 30 June 2014. This primarily reﬂected payables received from the parent entity in February 2014 which did not recur in H1 2015. Net cash generated by investing activities was US$0.3 million in the six month period ended 30 June 2015, an increase of US$86.6 million from the net cash consumed by investing activities

169 of US$(86.3) million in the six month period ended 30 June 2014, primarily reflecting the deferred consideration paid during 2014 relating to the acquisition of paysafecard. Net cash generated from financing activities was US$33.2 million in the six month period ended 30 June 2015, an increase of US$185.2 million from the net cash consumed by financing activities of US$(152.0) million in the six month period ended 30 June 2014, primarily reflecting the repayment of existing borrowings in 2014.

Year ended 31 December 2014 compared to year ended 31 December 2013 Net cash generated by operating activities was US$193.6 million in the 2014 financial year, an increase of US$127.4 million from the net cash generated by operating activities of US$66.2 million in the 2013 financial year. This primarily reflected an increase in e-money creditor which is a function of general growth in the business. Net cash consumed by investing activities was US$95.1 million in the 2014 financial year, a decrease of US$103.6 million from the net cash generated by investing activities of US$8.5 million in the 2013 financial year, primarily reflecting the deferred consideration paid during 2014 regarding the acquisition of paysafecard. Net cash generated from financing activities was US$4.8 million in the 2014 financial year, a decrease of US$28.4 million from the net cash generated by financing activities of US$33.2 million in the 2013 financial year, primarily reflecting receipt of funds used to repay existing borrowings, hence a lower balance compared to 2013.

Year ended 31 December 2013 compared to year ended 31 December 2012 Net cash generated by operating activities was US$66.2 million for the 2013 financial year, a decrease of US$36.3 million from the net cash generated by operating activities of US$102.5 million for the 2012 financial year. Despite higher operating profits in the 2013 financial year, the decrease in net cash generated by operating activities was a result of a US$47.6 million in e-money balances arising from the paysafecard acquisition on February, 2013. Net cash generated by investing activities was US$8.5 million for the 2013 financial year, a decrease of US$11.0 million from the net cash generated by investing activities of US$19.5 million for the 2012 financial year. The decrease in part reflected a US$26.1 million cash flow gain in the 2012 financial year relating to maturity/disposal of investments which did not reoccur in the 2013 financial year. Net cash generated from financing activities was US$33.2 million for the 2013 financial year, an increase of US$38.7 million over the 2012 financial year, primarily reflecting US$55.8 million in respect of the proceeds from borrowings.

170 Capitalisation and ﬁnancial indebtedness Skrill Operating Group capitalisation and ﬁnancial indebtedness Capitalisation The following table sets out the capitalisation of Skrill Operating Group at 30 June 2015. There has been no material change to the capitalisation of Skrill Operating Group since 30 June 2015. As at 30 June 2015

(reported on) (US$ million) Share capital 0.9 Share premium reserve 2.2 Share reserve 0.8 Merger reserve 96.5 Other reserves (1.6) Hedge reserve — Translation reserve (0.3) Retained earnings 104.8 Retained earnings – FX differences 23.4

Total equity 226.7

Financial Indebtedness The following table sets out the ﬁnancial indebtedness of Skrill Operating Group at 30 June 2015. As at the Latest Practicable Date, Skrill Operating Group’s ﬁnancial indebtedness primarily related to intercompany loans from Sentinel Bidco Limited (a subsidiary of Sentinel Topco Limited outside the Skrill Operating Group). Under such shareholder loans Sentinel Bidco Limited on-lent the proceeds of the Skrill Senior Facilities Agreement to Skrill Operating Group. As at the Latest Practicable Date, as a result of the Completion, the amount outstanding under such shareholder loans was reduced to US$54.2 million. See ‘‘–Sentinel Topco Limited Indebtedness’’ below for further details. For a description of the Skrill Senior Facilities Agreement, see paragraph 14.2 of Part XVI (Additional Information) of the March 2015 Prospectus which has been incorporated by reference into this document. As at 30 June 2015

(reported on) (US$ million) Bank borrowings — Shareholder loan 191.4 Finance lease liabilities 0.4 191.8

Current Bank borrowings — Shareholder loan — Finance lease liabilities 0.2

0.2 Non-current Bank borrowings — Shareholder loan 191.4 Finance lease liabilities 0.2

191.6

171 The following table sets out the net consolidated ﬁnancial indebtedness of Skrill Operating Group as at 30 June 2015.

As at 30 June 2015

(reported on) (US$ million) Net own funds (cash less E-money) 140.3 Trading securities 0.3

Liquidity 140.6

Current bank debt — Other current ﬁnancial debt (0.2)

Current ﬁnancial debt (0.2)

Net current ﬁnancial debt 140.4 Non-current ﬁnancial indebtedness (191.6)

Net debt (51.2)

Net debt comprises: Net own funds 140.3 Trading securities 0.3

Shareholder loan (191.4)

Finance lease liabilities (0.4)

Net debt (51.2)

172 Sentinel Topco Limited Indebtedness The following table sets out the consolidated ﬁnancial indebtedness of Sentinel Topco Limited as at 30 June 2015. Sentinel Topco Limited is the parent company of the Skrill Operating Group (see paragraph 4 of Part I (Information on the Paysafe Group)) and was acquired by Paysafe pursuant to the Skrill Acquisition. As at 30 June 2015, Sentinel Topco Limited’s debt was a combination of external bank debt of US$322 million (EUR 290.2 million) (being the Skrill Senior Facilities Agreement and presented net of issue costs), shareholder loan notes amounting to US$213.5 million (EUR 192.5 million), preference shares amounting to US$110.9 million (EUR 100 million) and accrued interest (shareholder loan notes, preference shares and accrued interest in aggregate totalling US$390.5 million net of issue costs). Upon completion of the Skrill Acquisition, the Credit Facilities were used to repay the amounts outstanding under the Skrill Senior Facilities Agreement in full. For a description of the Skrill Senior Facilities Agreement, see paragraph 14.2 of Part XVI (Additional Information) of the March 2015 Prospectus which has been incorporated by reference into this document.

As at 30 June 2015

(reported on) (US$ million) Bank borrowing(1) 322 Shareholder loan(2) 390.5 Finance lease liabilities 0.4

Total 712.9

Bank borrowing(1) — Shareholder loan(2) — Finance lease liabilities 0.2

Total Current 0.2

Bank borrowing(1) 322 Shareholder loan(2) 390.5 Finance lease liabilities 0.2

Total non-current 712.7

Notes: (1) Net of amortised issue costs. (2) Shareholder loan notes and preference shares includes interest and cumulative dividends including issue costs.

Capital expenditure The Skrill Operating Group’s business is not capital intensive. However, the Skrill Operating Group continuously plans capital expenditure for the development of its business, principally in respect of (i) capitalised development costs relating to product innovation, including capitalised software and development costs and the purchase of software licences and (ii) information technology and hardware.

173 The following table sets out the Skrill Operating Group’s capital expenses for the period:

Six month period ended 30 June Year ended 31 December

2015 2014 2014 2013 2012

(Reported on) (Audited) (US$ million) Purchase of intangible assets 13.1 6.4 19.5 107.4 8.3 Purchase of property, plant and equipment 2.8 1.9 3.6 8.2 1.5

Total capital expenditure 15.9 8.3 23.1 115.6 9.8

The significant increase in intangible assets during the historical period was primarily attributable to the Skrill Operating Group’s acquisition of paysafecard, while expenditure on property, plant and equipment was mainly attributable to increased IT investment, reflecting the growth of the business during this period. The Skrill Operating Group expects to fund future capital expenditure from its current cash and cash flows from operating activities.

Contractual commitments, reconciliation of ﬁnancial information and off-balance sheet arrangements Contractual commitments The following table summarises the Skrill Operating Group’s contractual obligations, commercial commitments and principal payments scheduled as at 30 June 2015.

Payments due by period

Less than More than Contractual commitments Total 1 year 1 - 5 years 5 years

(US$ million) Debt obligations 156.4 0.2 0.4 155.8 Operating lease payments 7.6 1.8 4.6 1.2

Total 164.0 2 5 157.0

In addition, the Skrill Operating Group paid £34 million, as consideration for the acquisition of Ukash. See paragraph 14.2 of Part XVI (Additional Information) of the March 2015 Prospectus which has been incorporated by reference into this document for description of the Ukash Acquisition. As a result of the Ukash Acquisition, the Skrill Operating Group has gained the beneﬁt of the free net cash held by Ukash. As at 31 December 2014, Ukash had free net cash of US$13 million (EUR 12 million). This amount was extracted without modiﬁcation from consolidated management accounts of Ukash as of and for the year ended 31 December 2014, which were not audited or reviewed by independent accountants. Ukash held free net cash of US$2.8 million (£1.9 million) on completion of the Ukash acquisition.

Sentinel Topco Limited financial information and reconciliation Sentinel Topco Limited was incorporated on 13 August 2013, as part of the structuring of the acquisition of the Skrill Group by CVC Funds, and is a holding company with a limited amount of historical financial information. Each of Sentinel Holdco 2 Limited, Sentinel Midco Limited, Sentinel Bidco Limited are also holding companies, with Sentinel Bidco Limited being the borrower under the Skrill Senior Facilities Agreement. Skrill Group Limited, a wholly owned subsidiary of Sentinel Bidco Limited, and its subsidiaries are the Skrill Group’s operating companies and Skrill Group Limited is the company for which historical financial information has been included in Sections D

174 and E of Part VII (Financial Information on the Skrill Operating Group) of this document. A diagram of the structure of the Skrill Group’s holding company structure is set out below.

Sentinel Topco Limited

Sentinel Holdco 2 Limited

Sentinel Midco Limited

Sentinel Bidco Limited (Borrower under the Skrill Senior Facilities Agreement

Skrill Group Limited (Operating company and company for which historical financial information is included in Sections D and E of Part VI (Financial Information of the Skrill Group) of this document)

Skrill Group subsidiaries

On Completion, the Credit Facilities were used to repay the amounts outstanding under the Skrill Senior Facilities Agreement in full and each of the guarantees were released. Each of Sentinel Topco Limited, Sentinel Holdco 2 Limited, Sentinel Midco Limited, Sentinel Bidco Limited and any other Skrill Group companies considered to be material to the Skrill Group acceded to the Credit Facilities, as guarantors, following Completion. As at the date of this document, it is not intended that any of Sentinel Topco Limited, Sentinel Holdco 2 Limited, Sentinel Midco Limited or Sentinel Bidco Limited will carry out any activity other than being holding companies for Skrill Group Limited. The tables below set out the reconciliation between the consolidated reported on income statements and balance sheets of the Sentinel Topco Limited and selected line items of Skrill Operating Group as at 30 June 2015.

175 Income Statement Reconciliation The income statement reconciliation reﬂects the consolidated income statement for the Skrill Operating Group for the six month period ended 30 June 2015. Sentinel Topco Limited acts as a holding company for the Skrill Group and therefore does not generate income. The amount shown as negative revenue represents elimination adjustment of intercompany revenue between subsidiaries of Skrill Group and Sentinel Bidco Limited. Expenses attributable to Sentinel Topco Limited (as shown in the second column below) relate to administrative costs and interest expenses relating to indebtedness incurred by Sentinel Topco Limited in the acquisition of the Skrill Operating Group. Substantially most of the administrative costs of Sentinel Topco Limited represents amortisation on intangibles which were acquired from the acquisition of the Skrill Operating Group by CVC Funds.

Skrill Operating US$ millions Group(1)Reconciliation(2) Skrill Group(3)

Revenue 173.3 -(0.3) 173.0 Cost of sales (70.2) — (70.2)

Gross proﬁt 103.1 -(0.3) 102.8 Sales and marketing costs (24.9) — (24.9) Administrative costs (54.5) (16.8) (71.3)

Operating proﬁt 23.7 (17.1) 6.6 Net interest (8.0) (26.4) (34.4)

Proﬁt before tax 15.7 (43.5) (27.8) Taxation (1.0) 3 2

Proﬁt after tax 14.7 (40.5) (25.8)

176 Balance Sheet Reconciliation The balance sheet reconciliation reﬂects the consolidated net assets of the Skrill Operating Group as at 30 June 2015 as adjusted for the additional consolidated net liabilities of Sentinel Topco Limited as set forth below.

Skrill Operating US$ millions Group(1)Reconciliation(2) Skrill Group(3)

(as at 30 June 2015) Assets Non-current assets Goodwill and other intangible assets(4) 346.2 441.3 787.5 Other non current assets 28.8 (11.8) 17

375.0 429.5 804.5

Current assets Cash(6) 661.2 1.1 662.3 Other current assets(5) 160 (53.1) 106.9 821.2 (52) 769.2

Total assets 1,196.2 377.5 1,573.7

Liabilities Non current liabilities Borrowings(7) 191.8 520.9 712.7 Derivative ﬁnancial instruments(8) — 1.8 1.8 Other non current liabilities 20.6 55.5 76.1

212.4 578.2 790.6

Current liabilities Other current liabilities(5) 756.9 (42.5) 714.4 Derivative ﬁnancial instruments(8) — 2.1 2.1 Borrowings 0.2 — 0.2

757.1 (40.4) 716.7

Total Liabilities 969.5 537.8 1,507.3

Net Assets 226.7 (160.3) 66.4

Notes: (1) Extracted without adjustment from the historical financial information of the Skrill Group for the 6 month period ended 30 June 2015 as set out in Part VI (Financial information of the Skrill Group) of this document. (2) Consolidated for Sentinel Topco Limited and subsidiaries but excluding the Skrill Operating Group. (3) Extracted from the historical financial information for Skrill Group for 6 month period ended 30 June 2015 as set out in Part VI (Financial information of the Skrill Group) of this document. (4) Goodwill and intangible assets recognised mainly on the acquisition of the Skrill Group by CVC Funds. (5) Net intercompany assets and liabilities eliminated on consolidation: On acquisition of the Skrill Group by CVC Funds, various intercompany balances have arisen between Skrill Operating Group and its holding companies, being Sentinel Topco Limited, Sentinel Holdco 2 Limited, Sentinel Midco Limited and Sentinel Bidco Limited, as certain intercompany loans and debt raised have been provided to the Skrill Operating Group by way of intercompany loans in order to fund debt repayments at Skrill Operating Group. (6) Cash: Additional cash held by the holding companies of Skrill Operating Group, being Sentinel Topco Limited, Sentinel Holdco 2 Limited, Sentinel Midco Limited and Sentinel Bidco Limited. (7) Debt external to Sentinel Topco Limited: Skrill Senior Facilities Agreement (e302 million), loan notes issued by Sentinel Holdco 2 Limited to Sentinel Group Holdings S.A. (e198 million) and preference shares (e100 million), and also accounting of accrued interest on these instruments, less issue costs. (8) Derivative financial instrument: an interest rate swap was taken out in respect of the debt taken at acquisition by CVC Funds.

177 Off-balance sheet arrangements As at 30 June 2015, the Skrill Operating Group had no off-balance sheet arrangements, as deﬁned in accordance with IFRS.

CRITICAL ACCOUNTING POLICIES The preparation of financial statements requires management to make significant estimates and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses as well as the related disclosure, including contingent assets and liabilities. Critical accounting policies and estimates are those policies or estimates which are particularly significant in presenting the Skrill Operating Group’s results of operations and include those that involve complex and subjective judgments and the use of assumptions, some of which may be inherently uncertain or susceptible to change. The effect of these judgments and the assumptions we make could potentially result in materially different results from that which would otherwise occur using different judgments and assumptions. For a detailed discussion of the application of these and other accounting policies as well as related estimates and judgments, see note 2 to the Skrill Operating Group’s audited consolidated financial statements for the six months ended 30 June 2015 and the year ended 31 December 2014 included in Section D of Part VI (Financial Information of the Skrill Group) of this document.

QUALITATIVE AND QUANTITATIVE DISCLOSURES ABOUT MARKET RISK Please refer to note 30 to the Skrill Operating Group’s reported on consolidated ﬁnancial statements for the six months ended 30 June 2015 and the audited consolidated ﬁnancial statements for the year ended 31 December 2014 included in Section D of Part VI (Financial Information of the Skrill Group) of this document for a discussion of the Skrill Operating Group’s risk management, currency risks, capital risk, interest rate risk and liquidity risk.

178 PART VI

FINANCIAL INFORMATION OF THE SKRILL GROUP

SECTION A: ACCOUNTANTS’ REPORT ON THE REPORTED ON FINANCIAL INFORMATION OF THE SKRILL GROUP FOR THE SIX MONTH PERIOD ENDED 30 JUNE 2015 AND THE AUDITED FINANCIAL INFORMATION OF THE SKRILL GROUP FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2014

SECTION B: REPORTED ON FINANCIAL INFORMATION OF THE SKRILL GROUP FOR THE SIX MONTH PERIOD ENDED 30 JUNE 2015 AND AUDITED FINANCIAL INFORMATION FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2014

SECTION C: ACCOUNTANTS’ REPORT ON THE REPORTED ON FINANCIAL INFORMATION OF THE SKRILL OPERATING GROUP FOR THE SIX MONTH PERIOD ENDED 30 JUNE 2015 AND THE AUDITED FINANCIAL INFORMATION FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2014

SECTION D: REPORTED ON FINANCIAL INFORMATION OF THE SKRILL OPERATING GROUP FOR THE SIX MONTH PERIOD ENDED 30 JUNE 2015 AND AUDITED FINANCIAL INFORMATION FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2014

SECTION E: AUDITED FINANCIAL INFORMATION OF THE SKRILL OPERATING GROUP FOR THE THREE YEARS ENDED 31 DECEMBER 2013

179 SECTION A: ACCOUNTANTS’ REPORT ON THE REPORTED ON FINANCIAL INFORMATION OF THE SKRILL GROUP FOR THE SIX MONTH PERIOD ENDED 30 JUNE 2015 AND THE AUDITED FINANCIAL INFORMATION OF THE SKRILL GROUP FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2014

The Directors Paysafe Group plc (‘‘Paysafe’’) Audax House 6 Finch Road Douglas Isle of Man

18 December 2015

Dear Sirs Skrill Group We report on the financial information set out on pages 182 to 226 for the year ended 31 December 2014 and the six months ended 30 June 2015. This financial information has been prepared for inclusion in the Prospectus dated 18 December 2015 of Paysafe Group plc on the basis of the accounting policies set out in note 2. This report is required by paragraph 20.1 of Annex 1 of the Prospectus Directive Regulation and is given for the purpose of complying with that paragraph and for no other purpose. We have not audited or reviewed the financial information for the 6 month period ended 30 June 2014 which has been included for comparative purposes only, and accordingly do not express an opinion thereon.

Responsibilities The Directors of Paysafe Group plc are responsible for preparing the financial information on the basis of preparation set out in note 2 to the financial information and in accordance with International Financial Reporting Standards as adopted by the European Union. It is our responsibility to form an opinion on the financial information and to report our opinion to you. Save for any responsibility arising under Prospectus Rule 5.5.3R(2)(f) to any person as and to the extent there provided, to the fullest extent permitted by law we do not assume any responsibility and will not accept any liability to any other person for any loss suffered by any such other person as a result of, arising out of, or in connection with this report or our statement, required by and given solely for the purposes of complying with paragraph 23.1 of Annex I of the Prospectus Directive Regulation, consenting to its inclusion in the Prospectus.

Opinion on financial information In our opinion, the financial information gives, for the purposes of the Prospectus dated 18 December 2015, a true and fair view of the state of affairs of Skrill Group as at the year ended 31 December 2014 and the six months ended 30 June 2015 and of its profits/losses, cash flows and changes in equity for year/period then ended in accordance with the basis of preparation set out in note 2 and in accordance with International Financial Reporting Standards as adopted by the European Union as described in note 2.

180 Declaration For the purposes of Prospectus Rule 5.5.3R(2)(f) we are responsible for this report as part of the Prospectus and declare that we have taken all reasonable care to ensure that the information contained in this report is, to the best of our knowledge, in accordance with the facts and contains no omission likely to affect its import. This declaration is included in the Prospectus in compliance with paragraph 1.2 of Annex I of the Prospectus Directive Regulation.

Yours faithfully

KPMG Audit LLC

181 SECTION B: REPORTED ON FINANCIAL INFORMATION OF THE SKRILL GROUP FOR THE SIX MONTH PERIOD ENDED 30 JUNE 2015 AND THE AUDITED FINANCIAL INFORMATION OF THE SKRILL GROUP FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2014

Consolidated income statement (all amounts in US$ thousands unless otherwise stated)

12 months 6 months 6 months to 31 to 30 June to 30 June December Note 2015 2014 2014

Revenue 5 172,979 128,066 297,099 Cost of sales 6 (70,172) (51,627) (118,333)

Gross proﬁt 102,807 76,439 178,766

Sales and marketing expenses (24,946) (19,181) (41,365) Administrative expenses (71,263) (53,659) (130,724)

Operating proﬁt 6,598 3,599 6,677

Finance income 11 25 5 40 Finance costs 12 (34,450) (42,221) (83,967)

Loss before income tax (27,827) (38,617) (77,250)

Income tax expense 13 1,994 (2,251) 5,706

Loss for the period * (25,833) (40,868) (71,544)

* Loss for the period is fully attributable to owners of the parent

182 Consolidated statement of comprehensive income (all amounts in US$ thousands unless otherwise stated)

6 months 6 months 12months to 30 June to 30 June to 31 Dec Note 2015 2014 2014

Loss for the period (25,833) (40,868) (71,544)

Other comprehensive income:

Items that will not be reclassified to profit or loss Remeasurements of post-employment benefit obligations 26 (21) Items that may be subsequently reclassified to profit or loss Change in value of available-for-sale financial assets 18,26 (130) (8) (488) Exchange differences on translation of foreign operations 26 1,122 (12) 589 Cash flow hedge 710 (5,164) (4,557)

Other comprehensive expense for the period 1,702 (5,184) (4,477)

Total comprehensive expense for the period * (24,131) (46,052) (76,021)

* Total comprehensive expense for the period is fully attributable to owners of the parent

183 Consolidated balance sheet (all amounts in US$ thousands unless otherwise stated)

As at As at As at 30 June 30 June 31 Dec Note 2015 2014 2014

Assets Non-current assets Goodwill 14 416,695 617,520 389,922 Other intangible assets 15 370,824 111,039 383,775 Property, plant and equipment 16 9,095 8,103 8,926 Investments 18 343 974 473 Deferred income tax asset 23 7,588 2,805 5,346

804,545 740,441 788,442 Current assets Inventories 19 1,075 728 1,114 Trade and other receivables 20 105,816 137,136 135,409 Cash and cash equivalents 27 662,262 656,045 701,853

769,153 793,909 838,376

Total assets 1,573,698 1,534,350 1,626,818

Equity and liabilities Non-current liabilities Borrowings 22 712,684 806,246 747,686 Provisions 171 224 — Derivative ﬁnancial instruments 21 1,814 3,051 3,107 Deferred income tax liabilities 23 75,920 22,585 80,151

790,589 832,106 830,944 Current liabilities Trade and other payables 24 702,112 714,570 755,801 Current income tax liabilities 8,954 11,569 6,285 Provisions 3,308 — — Borrowings 22 230 278 252 Derivative ﬁnancial instruments 21 2,070 2,080 2,116

716,674 728,497 764,454

Total liabilities 1,507,263 1,560,603 1,595,398

Equity attributable to owners of the parent Share capital 25 24,961 24,961 24,961 Share premium — — — Share reserve (307) — — Merger reserve — — — Translation reserve 26 1,727 (10) 606 Other reserves 26 (653) (11) (524) Hedge reserve (3,984) (5,135) (4,694) Retained earnings (97,377) (40,868) (71,544) Retained earnings – FX difference 142,068 (5,190) 82,615

Total equity 66,435 (26,253) 31,420

Total equity and liabilities 1,573,698 1,534,350 1,626,818

184 Consolidated statement of changes in equity (all amounts in US$ thousands unless otherwise stated)

Other Share Share Share Merger reserves Hedge Retained capital premium reserve reserve (note 26) reserve earnings FX Total

Balance as at 12 February 2014 — ———————— Loss for the period — —————(40,868) — (40,868) Other comprehensive income for the period — — — — (20) (5,164) — — (5,184)

Total comprehensive income — — — — (20) (5,164) (40,868) — (46,052)

Issue of shares 24,961 ———————24,961

Total contributions by owners of the parent, recognised directly in equity 24,961 ———————24,961

Retained earnings – FX difference (1) 29 — (5,190) (5,162)

Balance as at 30 June 2014 24,961 (21) (5,135) (40,868) (5,190) (26,253)

Balance as at 13 August 2013 — ————————

Loss for the period — —————(71,544) — (71,544) Other comprehensive income for the period — — — — 80 (4,557) — — (4,477)

Total comprehensive income 80 (4,557) (71,544) (76,021)

Issue of shares 24,961 ———————24,961

Total contributions by owners of the parent, recognised directly in equity 24,961 — — — ————24,961

Foreign Exchange gains — ——— 2 (137) — 82,615 82,480

Balance as at 31 December 2014 * 24,961 — — — 82 (4,694) (71,544) 82,615 31,420

Balance as at 1 January 2015 24,961 — — — 82 (4,694) (71,544) 82,615 31,420

Proﬁt for the period — —————(25,833) — (25,833) Other comprehensive income for the period — — — — 992 710 — — 1,702

Total comprehensive income 992 710 (25,833) (24,131)

Other movement — — (305) — (305)

Total contributions by owners of the parent, recognised directly in equity ——(305) (305)

Foreign Exchange gains — — (2) — — — — 59,453 59,451

Balance as at 30 June 2015 24,961 — (307) — 1,074 (3,984) (97,377) 142,068 66,435

* Total equity is fully attributable to owners of the parent.

185 Consolidated statement of cash ﬂows (all amounts in US$ thousands unless otherwise stated)

6 months 6 months 12months to 30 June to 30 June to 31 Dec Note 2015 2014 2014

Net cash generated from operating activities * 27 12,946 24,073 146,977 Acquisition of subsidiary, net of cash ** 10,553 (539,607) 108,786 Purchases of property, plant and equipment (1,217) (1,413) (3,301) Purchase of intangible assets (9,089) (5,860) (14,995) Finance lease payments (115) (115) (247)

Net cash generated from investing activities 132 (546,995) 90,243

Proceeds from borrowings 30,162 377,726 596,743 Transaction costs on bank loan — — (28,222) Repayments of borrowings (21,568) (150,276) (145,054) Payment of ﬁnance derivatives (1,248) — (2,799) Proceeds from issue of shares — — 18,926 Proceeds from investors 334,307 100,549

Net cash generated from ﬁnancing activities 7,346 561,757 540,143

Net increase in cash and cash equivalents 20,424 38,835 777,363

Cash and cash equivalents at the beginning of the period 701,853 647,031 — Net foreign exchange difference (60,015) (29,821) (75,510)

Cash and cash equivalents at the end of the period 27 662,262 656,045 701,853

* Net cash generated from operating activities includes an amount of $514,000 (for the period ended 20 June 2014: $46,773,000) which relates to increase in the e-money ﬂoat balance. ** The amount of $108,786,000 includes $77,577,000 which relates to payment of the deferred and contingent consideration regarding the acquisition of paysafecard.

Reconciliation of total cash and cash equivalents to own cash is provided below:

As at As at As at 30 June 30 June 31 Dec 2015 2014 2014

Cash and cash equivalents at the end of the period 662,262 656,045 701,853 Less: e-money ﬂoat (note 24) (520,976) (533,960) (560,949) Less: amounts owed to merchants / web shops (69,614) (62,415) (71,465)

Own cash at the end of the period 71,672 59,670 69,439

186 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 1. GENERAL INFORMATION Sentinel Topco Limited (‘‘the Company’’) is a company incorporated and domiciled in Jersey. The address of the registered ofﬁce is 22-24 Seale Street, St. Helier, Jersey, JE2 3QG. The nature of the operations of Sentinel Topco Limited and its subsidiaries (together ‘‘the Group’’) are electronic money transfer services and online prepaid solutions. In addition the Group develops software for use in its principal activities.

2. SIGNIFICANT ACCOUNTING POLICIES The principal accounting policies applied in the preparation of these consolidated ﬁnancial statements are set out below.

Basis of preparation The consolidated financial statements have been prepared in accordance with International Financial Reporting Standards as adopted by the European Union (IFRS – EU) and IFRIC Interpretations. The consolidated financial statements have been prepared on the historical cost basis, except for the revaluation of certain financial instruments that have been measured at fair value through profit or loss. Historical cost is generally based on the fair value of the consideration given in exchange for the assets. All operations are continuing operations. The preparation of financial information in conformity with IFRS – EU requires the use of certain critical accounting estimates. It also requires management to exercise its judgement in the process of applying the Group’s accounting policies. The areas involving a higher degree of judgement or complexity, or areas where assumptions and estimates are significant to the consolidated financial information are disclosed in Note 4.

Going concern The directors have adopted the going concern basis of accounting in preparing the consolidated financial information which is based on the assumption that the Group will continue to exist in the foreseeable future. For the period ended 30 June 2015 the Group realised a loss after tax amounting to $ 25,833,000 (period ended 30 June 2014: $40,868,000, period ended 31 December 2014: $71,544,000). These negative figures are mainly due to: * interest on loans from related parties, which are not subject to elimination at that level of consolidation – $ 23,487,000 (period ended 30 June 2014: $24,367,000, period ended 31 December 2014: 54,630,000) (note 12); * amortisation on the intangibles (most of which are the newly identified intangibles from the acquisition of Skrill Group) amounting to $21,576,000 (period ended 31 December 2014: $41,604,000 (note 15). This is not applicable for the period ended 30 June 2014 as the acquisition accounting is not finalised and not accounted for yet at that date, thus no effect on the amortisation; * non-recurring costs – amounting to $10,366,000 (period ended 30 June 2014: $18,275,000, period ended 31 December 2014: $27,670,000) (note 7). Excluding all these exceptional events the Group reported adjusted EBITDA amounting to $40,140,000 (period ended 30 June 2014: $30,888,000, period ended 31 December 2014: $78,939,000) (note 7). Subsequent to the year end, on 10 August 2015, the transaction by Paysafe to acquire Sentinel Topco Limited completed. As a result subsequent to this date the Group is a subsidiary of Paysafe Group plc. This transaction resulted in the repayment of the debt structure relating to the Group. The consideration by Paysafe was funded by a combination of debt and equity proceeds. The Paysafe Group plc Board have prepared detailed forecast financial information in respect of the combined group, reflecting its trading profile and financing payment obligations (both interest and capital), and associated covenant requirements. This forecast financial information has also been subject to reasonably foreseeable sensitivity scenarios. Under both the normal and stressed trading conditions considered the Group is forecast to continue to have sufficient resources available to service its debt obligations and continue trading. As such the directors of Paysafe Group plc have a reasonable expectation that the Group has adequate resources to continue in operational existence for the foreseeable future.

187 Business combinations Under the requirements of IFRS 3 (Revised), Business combinations, all business combinations that are not business combinations involving entities under common control, are accounted for using the purchase method. The cost of a business combination is the aggregate of the fair values at the date of exchange, of assets given, liabilities incurred or assumed and equity instruments issued by the Group in exchange for control of the acquire.

Subsidiaries Subsidiaries are all entities over which the Group has the power to govern the financial and operating policies generally accompanying a shareholding of more than one half of the voting rights. The existence and effect of potential voting rights that are currently exercisable or convertible are considered when assessing whether the Group controls another entity. The Group also assesses existence of control where it does not have more than 50% of the voting power but is able to govern the financial and operating policies by virtue of de-facto control. De-facto control may arise in circumstances where the size of the Group’s voting rights relative to the size and dispersion of holdings of other shareholders give the Group the power to govern the financial and operating policies, etc. Subsidiaries are fully consolidated from the date on which control is transferred to the Group. They are de-consolidated from the date that control ceases. On acquisition of a subsidiary, the assets, liabilities and contingent liabilities of a subsidiary are measured at their fair value at that date. Any excess of the cost of acquisition over the identifiable net assets acquired is recognised as goodwill. Any deficiency of the cost of acquisition below the fair values of the identifiable net assets acquired (i.e. discount on acquisition) is credited to the consolidated income statement in the financial year of acquisition. Acquisition-related costs are recognised in the income statement as incurred. Any contingent consideration to be transferred by the Group is recognised at fair value at the acquisition date. Subsequent changes to the fair value of the contingent consideration that is deemed to be an asset or liability is recognised in accordance with IAS 39 in profit or loss. The results of subsidiaries acquired during the period are included in the consolidated income statement from the effective date of acquisition. Control is achieved where the Company has the power to govern the financial and operating policies of an investee entity so as to obtain benefits from its activities. All intra-Group transactions, balances, income and expenses are eliminated on consolidation.

Goodwill Goodwill represents the excess of the cost of an acquisition over the fair value of the identifiable assets and liabilities of a subsidiary at the date of acquisition. Goodwill is initially recognised as an asset at cost and is subsequently measured at cost less any accumulated impairment losses. Goodwill is reviewed for impairment at least annually, or more frequently when there is an indication of impairment. Any impairment is recognised immediately in the income statement and is not subsequently reversed. For the purpose of impairment testing, Goodwill is allocated to the Group’s cash-generating units which are expected to benefit from the synergies of the combination. If the recoverable amount of the cash-generating units is less than the carrying amount, the impairment loss is allocated first to reduce the carrying amount of goodwill and then to the other assets pro-rata on the basis of the carrying amount of each asset in the cash generating units.

Foreign currency translation (a) Functional and presentation currency Items included in the ﬁnancial statements of each of the Group’s entities are measured using the currency of the primary economic environment in which the entity operates (‘the functional currency’). The functional currency of the Group is EUR. The consolidated ﬁnancial information have been represented in US Dollars (USD) for the purpose of accompanying the prospectus.

188 translation at period-end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognised in the income statement. All foreign exchange gains and losses are presented in the income statement within ‘administrative expenses’.

(c) Group companies The results and ﬁnancial position of all the Group entities (none of which has the currency of a hyper-inﬂationary economy) that have a functional currency different from the presentation currency are translated into the presentation currency as follows: (i) Assets and liabilities for each balance sheet presented are translated at the closing rate at the date of that balance sheet; (ii) Income and expenses for each income statement are translated at average exchange rates (unless this average is not a reasonable approximation of the cumulative effect of the rates prevailing on the transaction dates, in which case income and expenses are translated at the rate on the dates of the transactions); and (iii) All resulting exchange differences are recognised in other comprehensive income. On consolidation, exchange differences arising from the translation of the net investment in foreign operations are taken to other comprehensive income.

(d) Representation in USD The following exchange rates have been used for the USD representation as per point (a) above:

6 months to 6 months to 12 months Exchange rates 30 June 30 June to 31 Dec (source: Oanda.com) 2015 2014 2014

Average EUR:USD 1.1171 1.3735* 1.3258** Closing EUR:USD 1.1094 1.3645 1.2155 Opening EUR:USD (12 February 2014) — — 1.3658

* 12 February 2014 – 30 June 2014 – trading period, since acquisition; ** 12 February 2014 – 31 Dec 2014 – trading period, since acquisition; For the purpose of the translation the balance sheet line items have been classified as monetary and non-monetary, as follows: Type Description Monetary Trade and other receivables, Investments, Cash and cash equivalents, Borrowings, Provisions, Derivative financial instruments, Trade and other payables, Current income tax liabilities. Non-monetary Goodwill, Other intangible assets, Property, plant and equipment, Investments, Deferred income tax asset, Inventories, Deferred income tax liabilities, Share capital, Share reserve, Translation reserve, Other reserves, Hedge reserve. Monetary items – used the relevant closing exchange rate for each year. Non-monetary items: (a) as at 31 December 2014 the balance sheet positions relating to non-monetary items are translated at the opening rate, assumed to be the EUR:USD exchange rate at 12 February 2014 for the purposes of this analysis). Simplifying assumption that since the largest changes in non-monetary items occurred on the acquisition date (acquisition of fixed assets, issue of shares etc.), this is the most appropriate rate to use; (b) as at 30 June 2015 the balances relating to non-monetary items are not retranslated but remain at the historical rate (assumed to be the EUR:USD exchange rate at 12 February 2014 for the purposes of this analysis). Any change in a non-monetary item between 31 December 2014 and 30 June 2015 is translated at the average EUR:USD exchange rate for the period;

189 (c) as at 30 June 2014 the balances relating to non-monetary items are not retranslated but remain at the historical rate (for the year ended 31 December 2011, assumed to be the EUR:USD exchange rate at 1 January 2011 for the purposes of this analysis). Any change in a non-monetary item is translated at the average EUR:USD exchange rate for the period; Each income statement line item has been translated using the average EUR:USD exchange rate for the respective period.

Property, plant and equipment Property, plant and equipment are stated at historical cost less accumulated depreciation. Historical cost includes expenditure that is directly attributable to the acquisition of the items and the costs attributable to bringing the asset to its working condition for its intended use. Subsequent costs are included in the asset’s carrying amount or recognised as a separate asset, as appropriate, only when it is probable that future economic benefits associated with the item will flow to the Group and the cost of the item can be measured reliably. The carrying amount of the replaced part is derecognised. All other repairs and maintenance are charged to the income statement during the financial period in which they are incurred. Depreciation is calculated using the straight-line method over their estimated useful lives, as follows:

(b) Client relationships – merchants and end users Contractual customer relationships acquired in a business combination, including relationships with merchants and those with end users, are recognised at fair value at the acquisition date. The contractual customer relations have a ﬁnite useful life and are carried at cost less accumulated amortisation. Amortisation is calculated using the straight-line method over the expected life of the customer relationship, which is six to fourteen years;

(c) Software and website development Costs associated with maintaining computer software programmes are recognised as an expense as incurred. Acquired computer software licences are capitalised on the basis of the costs incurred to acquire and bring to use the specific software. An internally-generated intangible asset arising from the development of the Group’s IT platform is recognised only if all of the following conditions are met: * an asset is created that can be identified; * it is probable that the asset created will generate future economic benefits; and * the development cost of the asset can be measured reliably. Internally-generated intangible assets are amortised on a straight-line basis over their useful lives. Where no internally-generated intangible asset can be recognised, development expenditure is recognised as an expense in the period in which it is incurred. Development costs directly attributable to the design and testing of identifiable and unique software products controlled by the Group are recognised as intangible assets when the following criteria are met: * it is technically feasible to complete the software product so that it will be available for use; * management intends to complete the software product and use or sell it; * there is an ability to use or sell the software product; * it can be demonstrated how the software product will generate probable future economic benefits;

190 * adequate technical, ﬁnancial and other resources to complete the development and to use or sell the software product are available; and * the expenditure attributable to the software product during its development can be reliably measured. Directly attributable costs capitalised as part of the software product include the software development employee costs. Other development expenditures that do not meet these criteria are recognised as an expense as incurred. Development costs previously recognised as an expense are not recognised as an asset in a subsequent period. Computer software development costs recognised as assets are amortised over their estimated useful lives, which do not exceed ﬁve years. Expenditure on research activities is recognised as an expense in the period in which it is incurred.

Impairment of non-financial assets Assets that have an indefinite useful life – for example, goodwill – are not subject to amortisation and are tested annually for impairment. At each balance sheet date, the management of the Group reviews the carrying amounts of all other non-financial assets that are subject to amortisation to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any). Where the asset does not generate cash flows that are independent from other assets, the Group estimates the recoverable amount of the cash-generating unit to which the asset belongs. Recoverable amount is the higher of fair value less costs to sell and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset for which the estimates of future cash flows have not been adjusted. If the recoverable amount of an asset (or cash-generating unit) is estimated to be less than its carrying amount, the carrying amount of the asset (or cash-generating unit) is reduced to its recoverable amount. An impairment loss is recognised immediately in the income statement. Where an impairment loss subsequently reverses, the carrying amount of the asset (or cash- generating unit) is increased to the revised estimate of its recoverable amount, but so that the increased carrying amount does not exceed the carrying amount that would have been determined had no impairment loss been recognised for the asset (or cash-generating unit) in prior years. A reversal of an impairment loss is recognised immediately in the income statement.

Inventories Inventories are stated at the lower of cost and net realisable value. Cost is determined using the ﬁrst in, ﬁrst out (FIFO) method in regard to the security tokens, which are expensed when issued to the end users and weighted average – for all other type of inventories.

Financial assets Classification The Group classifies its financial assets in the following categories: at fair value through profit or loss, and loans and receivables. The classification depends on the purpose for which the financial assets were acquired. Management determines the classification of its financial assets at initial recognition.

(a) Financial assets at fair value through profit or loss A financial asset is classified in this category if acquired principally for the purpose of selling in the short term. Assets in this category are classified as current assets if expected to be settled within 12 months; otherwise, they are classified as non-current.

(b) Loans and receivables Loans and receivables are non-derivative financial assets with fixed or determinable payments that are not quoted in an active market. They are included in current assets, except for maturities greater than 12 months after the end of the reporting period. These are classified as non-current

191 assets. The Group’s loans and receivables comprise ‘trade and other receivables’ (note 20) and ‘cash and cash equivalents’ (note 27) on the balance sheet. (c) Available for sale Available-for-sale ﬁnancial assets are non-derivatives that are either designated in this category or not classiﬁed in any of the other categories. They are included in non-current assets unless the investment matures or management intends to dispose of it within 12 months of the end of the reporting period.

Recognition and measurement Financial assets are recognised on the trade-date being the date on which the Group commits to purchase or sell the asset. Financial assets are initially recognised at fair value. Financial assets carried at fair value through profit or loss are initially recognised at fair value, and transaction costs are expensed in the income statement. Financial assets are derecognised when the rights to receive cash flows from the investments have expired or have been transferred and the Group has transferred substantially all risks and rewards of ownership. Loans and receivables are subsequently carried at amortised cost using the effective interest method. Other gains or losses arising from changes in the fair value of the ‘financial assets at fair value through profit or loss’ category are presented in the income statement within ‘Administrative expenses’ in the period in which they arise.

Impairment of financial assets (a) Assets carried at amortized cost The Group assesses at the end of each reporting period whether there is objective evidence that a financial asset or group of financial assets is impaired. A financial asset or a group of financial assets is impaired and impairment losses are incurred only if there is objective evidence of impairment as a result of one or more events that occurred after the initial recognition of the asset (a ‘loss event’) and that loss event (or events) has an impact on the estimated future cash flows of the financial asset or group of financial assets that can be reliably estimated. For loans and receivables category, the amount of the loss is measured as the difference between the asset’s carrying amount and the present value of estimated future cash flows discounted at the financial asset’s original effective interest rate. The carrying amount of the asset is reduced and the amount of the loss is recognised in the income statement.

Derivative financial instruments and hedging activities Derivatives are initially recognised at fair value on the date a derivative contract is entered into and are subsequently re-measured at their fair value. The method of recognising the resulting gain or loss depends on whether the derivative is designated as a hedging instrument, and if so, the nature of the item being hedged. The Group recognises a cash flow hedge in the balance sheet at the end of all presented periods The Group documents at the inception of the transaction the relationship between hedging instruments and hedged items, as well as its risk management objectives and strategy for undertaking various hedging transactions. The Group also documents its assessment, both at hedge inception and on an ongoing basis, of whether the derivatives that are used in hedging transactions are highly effective in offsetting changes in fair values or cash flows of hedged items. Movements on the hedging reserve in other comprehensive income are shown in the consolidated statement of changes in equity. The full fair value of a hedging derivative is classified as a non- current asset or liability when the remaining life of the hedged item is more than 12 months and as a current asset or liability when the remaining maturity of the hedged item is less than 12 months. The effective portion of changes in the fair value of derivatives that are designated and qualify as cash flow hedges is recognised in other comprehensive income. The gain or loss relating to the ineffective portion is recognised immediately in the income statement within ‘administrative expenses’ (no such gains and losses occurred during the presented periods). Amounts accumulated in equity are reclassified to profit or loss in the periods when the hedged item affects profit or loss. The gain or loss relating to the effective portion of interest rate swaps hedging variable rate borrowings is recognised in the income statement within ‘finance income/ cost’. However, when the forecast transaction that is hedged results in the recognition of a non-

192 financial asset (for example, inventory or fixed assets), the gains and losses previously deferred in equity are transferred from equity and included in the initial measurement of the cost of the asset. The deferred amounts are ultimately recognised in cost of goods sold in the case of inventory or in depreciation in the case of fixed assets. When a hedging instrument expires or is sold, or when a hedge no longer meets the criteria for hedge accounting, any cumulative gain or loss existing in equity at that time remains in equity and is recognised when the forecast transaction is ultimately recognised in the income statement. When a forecast transaction is no longer expected to occur, the cumulative gain or loss that was reported in equity is immediately transferred to the income statement within ‘administrative expenses’.

Trade receivables Trade receivables are amounts due from payment service providers who process transactions on behalf of the Group and distribution partners who receive cash for the prepaid cards bought. If collection is expected in one year or less (or in the normal operating cycle of the business if longer), they are classiﬁed as current assets. If not, they are presented as non-current assets. Trade receivables are recognised initially at fair value and subsequently measured at amortised cost using the effective interest method.

Cash and cash equivalents Cash and cash equivalents include cash in hand and deposits held at call with banks. Included within cash are amounts relating to restricted cash balances as per agreements with speciﬁc providers. Skrill Limited and Prepaid Services Company Limited, FCA regulated entities, are required at all times to have qualifying liquid assets (comprising of cash and cash equivalents and investments) in excess of its e-money ﬂoat (see note 31).

E-Money float The e-Money float represents amounts received into customer e-wallet accounts and unused prepaid card balances and are recorded within trade and other payables. These amounts are reflected in the consolidated balance sheet on the approval of the initiated transactions and unused card balances and are measured at fair value. The e-money float received forms part of the Group’s cash and cash equivalents and investment balances.

Financial liabilities Classification The Group classifies its financial liabilities in the following categories: at fair value through profit or loss, and as other financial liabilities measured at amortised cost. The classification depends on the purpose for which the financial liabilities were acquired or incurred. Management determines the classification of its financial liabilities at the initial recognition. The Group’s other financial liabilities measured at amortised cost comprise ‘trade and other payables’ and ‘borrowings’ in the balance sheet.

Preference shares classification Preference shares are issued with various rights. In determining whether a preference share is a financial liability or an equity instrument, the Group assesses the particular rights attaching to the share to determine whether it exhibits the fundamental characteristic of a financial liability. A preference share (or other instrument) that: * provides for mandatory redemption by the issuer for a fixed or determinable amount at a fixed or determinable future date; or * gives the holder the right to require the issuer to redeem the instrument at or after a particular date for a fixed or determinable amount * contains a financial liability, since the issuer has an obligation, or potential obligation, to transfer cash or other financial assets to the holder. Non-discretionary dividends establish an additional liability component. A liability would be recognised at an amount equal to the present value of the redemption amount and the non- discretionary dividends. Dividends set at market rate would typically result in an overall liability classification of the whole instrument.

193 Recognition and measurement (a) Trade payables Trade payables are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers or vendors. Accounts payable are classiﬁed as current liabilities if payment is due within one year or less. If not, they are presented as non-current liabilities. Trade payables are recognised initially at fair value and subsequently measured at amortised cost using the effective interest method. (b) Borrowings Borrowings are recognised initially at fair value, net of transaction costs incurred. Borrowings are subsequently carried at amortised cost. Any difference between the proceeds (net of transaction costs) and the redemption value is recognised in the income statement over the period of the borrowings using the effective interest method. Finance charges are accounted for on an accruals basis and charged to the income statement using the effective interest rate method. Borrowings are classiﬁed as current liabilities if payment is due within one year or less. If not, they are presented as non-current liabilities.

Financial liabilities and equity Debt and equity instruments are classiﬁed as either ﬁnancial liabilities or as equity in accordance with the substance of the contractual arrangement.

Equity instruments An equity instrument is any contract that evidences a residual interest in the assets of an entity after deducting all of its liabilities. Equity instruments issued by the Group are recognised at the proceeds received, net of direct issue costs.

Derecognition of ﬁnancial liabilities The Group derecognises ﬁnancial liabilities when, and only when, the Group’s obligations are discharged, cancelled or they expire.

Segment reporting Operating segments are reported in a manner consistent with the internal reporting provided to the chief operating decision-maker. The chief operating decision-maker, who is responsible for allocating resources and assessing performance of the operating segments, has been identiﬁed as the Chief Executive Ofﬁcer.

Current and deferred income tax The tax expense for the period comprises current and deferred tax. Tax is recognised in the income statement. The current income tax charge is calculated on the basis of the tax laws enacted or substantively enacted at the balance sheet date in the countries where the Company’s subsidiaries operate and generate taxable income. Management periodically evaluates positions taken in tax returns with respect to situations in which applicable tax regulation is subject to interpretation. It establishes provisions where appropriate on the basis of amounts expected to be paid to the tax authorities. Deferred income tax is recognised, using the liability method, on temporary differences arising between the tax bases of assets and liabilities and their carrying amounts in the consolidated financial information. However, the deferred income tax is not accounted for if it arises from initial recognition of an asset or liability in a transaction other than a business combination that at the time of the transaction affects neither accounting, nor taxable profit or loss. Deferred income tax is determined using tax rates (and laws) that have been enacted or substantially enacted by the balance sheet date and are expected to apply when the related deferred income tax asset is realised or the deferred income tax liability is settled. Deferred income tax assets are recognised only to the extent that it is probable that future taxable profit will be available against which the temporary differences can be utilised. Deferred income tax assets and liabilities are offset when there is a legally enforceable right to offset current tax assets against current tax liabilities and when the deferred income tax assets and

194 liabilities relate to income taxes levied by the same taxation authority on either the taxable entity or different taxable entities where there is an intention to settle the balances on a net basis.

Revenue recognition Skrill revenue from transaction processing services includes merchant and end user fees as well as FX spread income (fees from inter-currency transactions) which are generated from online activities. Revenues from transaction processing services are recognised at the time the customer transactions are fulfilled. End user fees are calculated as a percentage of funds processed and/or as a charge per transaction. Merchant fees are calculated as a percentage of funds processed and/or a fixed charge per transaction on behalf of merchants. Revenue is net of rebates. Rebates are recognised based on the specific terms outlined in customer contracts. Included within revenues is interest income which is derived from the investment of the e-money float held. Revenue within paysafecard business is recognised upon delivery or transfer of risk to the customer, net of rebates and discounts. Fees are earned from web-shops (merchants) as a percentage of card credits used by them.

Finance income Finance income (interest income) is recognised when it is probable that the economic benefits will flow to the Group and the amount of income can be measured reliably. Finance income is accrued on a time basis, by reference to the principal outstanding and at the effective interest rate applicable, which is the rate that exactly discounts estimated future cash receipts through the expected life of the financial asset to that asset’s net carrying amount on initial recognition.

Leasing Leases in which a significant portion of the risks and rewards of ownership are retained by the lessor are classified as operating leases. Payments made under operating leases (net of any incentives received from the lessor) are charged to the income statement on a straight-line basis over the period of the lease. The group leases certain property, plant and equipment. Leases of PPE where the Group has substantially transferred all the risks and rewards of ownership are classified as finance leases. Finance leases are capitalised at the lease’s commencement at the lower of the fair value of the leased property and the present value of the minimum lease payments. Each lease payment is allocated between the liability and finance charges. The corresponding rental obligations, net of finance charges, are included in other long-term payables. The interest element of the finance cost is charged to the income statement over the lease period so as to produce a constant periodic rate of interest on the remaining balance of the liability for each period. The property, plant and equipment acquired under finance leases are depreciated over the shorter of the useful life of the asset and the lease term.

Dividend policy Dividend distribution to the Company’s shareholders is recognised as a liability in the Group’s ﬁnancial information in the ﬁnancial year in which the dividends are approved by the Company’s shareholders.

Non-recurring costs Exceptional items comprise those items that are material and one off in nature that the Group believes should be separately disclosed in order to assist in the understanding of the underlying ﬁnancial performance of the Group. Exceptional items are those items which are of a non-recurring nature, and in the judgement of the directors, need to be disclosed separately by virtue of their nature, size or incidence. Costs that are recurring include: * The restructuring of the activities of entities within the Group and reversal of any provision for the cost of restructuring;

195 * Disposal, revaluations or impairment of non-current assets (including property, plant and equipment); * Disposal of assets associated with discontinued operations; * Other. Income and expenses are not offset and are presented gross, unless required or permitted by an IFRS. The Group presents reconciliation between EBITDA and adjusted EBITDA in the notes to the ﬁnancial statements. Additional breakdowns of the exceptional items are presented together with explanatory notes for the nature and cause of speciﬁc items.

3. EFFECT OF THE NEW STANDARDS, AMENDMENTS AND INTERPRETATIONS NOT YET ADOPTED BY THE GROUP A number of new standards and amendments to standards and interpretations are effective for annual periods beginning after 1 January 2014, and have not been applied in preparing these consolidated financial statements. None of these is expected to have a significant effect on the consolidated financial statements of the Group, except the following set out below: IFRS 9, ‘Financial instruments,’ addresses the classification, measurement and recognition of financial assets and financial liabilities. The complete version of IFRS 9 was issued in July 2014. It replaces the guidance in IAS 39 that relates to the classification and measurement of financial instruments. IFRS 9 retains but simplifies the mixed measurement model and establishes three primary measurement categories for financial assets: amortised cost, fair value through OCI and fair value through P&L. The basis of classification depends on the entity’s business model and the contractual cash flow characteristics of the financial asset. Investments in equity instruments are required to be measured at fair value through profit or loss with the irrevocable option at inception to present changes in fair value in OCI not recycling. There is now a new expected credit losses model that replaces the incurred loss impairment model used in IAS 39. For financial liabilities there were no changes to classification and measurement except for the recognition of changes in own credit risk in other comprehensive income, for liabilities designated at fair value through profit or loss. IFRS 9 relaxes the requirements for hedge effectiveness by replacing the bright line hedge effectiveness tests. It requires an economic relationship between the hedged item and hedging instrument and for the ‘hedged ratio’ to be the same as the one management actually use for risk management purposes. Contemporaneous documentation is still required but is different to that currently prepared under IAS 39. The standard is effective for accounting periods beginning on or after 1 January 2018. Early adoption is permitted. The Group is yet to assess IFRS 9’s full impact. IFRS 15, ‘Revenue from contracts with customers’ deals with revenue recognition and establishes principles for reporting useful information to users of financial statements about the nature, amount, timing and uncertainty of revenue and cash flows arising from an entity’s contracts with customers. Revenue is recognised when a customer obtains control of a good or service and thus has the ability to direct the use and obtain the benefits from the good or service. The standard replaces IAS 18 ‘Revenue’ and IAS 11 ‘Construction contracts’ and related interpretations. The standard is effective for annual periods beginning on or after 1 January 2017 and earlier application is permitted. The Group is assessing the impact of IFRS 15. There are no other IFRSs or IFRIC interpretations that are not yet effective that would be expected to have a material impact on the Group.

196 The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to estimates are recognised in the period in which the estimate is revised if the revision affects only that period or in the period of the revision and future periods if the revision affects both current and future periods. The most important assessments made by management of the Company with respect to the application of IFRS – EU that may have a significant effect on the consolidated financial information, and estimates entailing a risk that the assets and liabilities reported may have to be significantly adjusted within the next financial year are described below:

(a) Revenue recognition Revenues from transaction processing services are recognised at the time the customer transactions are fulﬁlled. This requires the Group to assess at the point of service delivery whether these criteria have been met. When the Group determines that such criteria have been met, revenue is recognised. In making its judgements, management considers the detailed criteria for the recognition of revenue from the sale of services set out in IAS 18 Revenue and, in particular, whether the Group has transferred to the buyer the signiﬁcant risks and rewards relating to the transactions. The Group records estimated reductions to revenue for pricing agreements based on the recognised revenues.

(b) Business combinations The Group uses judgement, estimates and involves external specialists in determining the fair value of identifiable assets and liabilities acquired in a business combination, as well as calculating the fair value of the purchase consideration on acquisition. The fair value of assets acquired is determined either by applying the cost that would be associated with the asset in an active market or by discounting estimated future cash flows generated by the asset, assuming no active market exists. Purchase price allocation affects the results of the Group as goodwill is not amortised and finite life intangible assets are amortised. This could lead to significantly different amortisation costs recognised depending on the allocation between assets acquired.

(c) Estimated impairment of goodwill Determining whether goodwill is impaired requires an estimation of the value in use of the cash- generating units to which goodwill has been allocated. The value in use calculation requires the entity to estimate the future cash flows expected to arise from the cash-generating unit and a suitable discount rate in order to calculate present value. The Group assesses the carrying values of identifiable intangible assets, long-lived assets and goodwill annually, or more frequently if events or changes in circumstances indicate that such carrying values may not be recoverable. Factors considered important, which could trigger an impairment review, include the following: * significant under-performance relative to historical or projected future results; * significant changes in the manner of use of the acquired assets or the strategy for the overall business; and * significantly negative industry or economic trends. This assessment is based upon projections of anticipated discounted future cash flows. The most significant variables in determining cash flows are discount rates, terminal values, the number of years on which to base the cash flow projections, as well as the assumptions and estimates used to determine the cash inflows and outflows. The Group determines discount rates to be based on the risk inherent in the related activity’s current business model and industry comparisons. Terminal values are based on the expected life of products and forecasted life cycle and forecasted cash flows over that period. While the Group believes that its assumptions are appropriate, such amounts estimated could differ materially from what will actually occur in the future. In assessing goodwill, these non-discounted cash flows are prepared at a cash-generating unit level.

197 (d) Income taxes The Group is subject to the income tax laws of the various tax jurisdictions. These laws are complex and subject to different interpretations by taxpayers and tax authorities. Significant judgement is required in determining provisions for income taxes and deferred taxation. There are many transactions and calculations for which the ultimate tax determination is uncertain during the ordinary course of business. The Group recognises the liabilities for anticipated tax audit issues based on estimates of whether additional taxes will be due. Any reduction in the corporation tax liability as a result of business activities undertaken in a tax efficient manner, is fully provided for and released in accordance with the techniques identified by IAS 12, Income taxes. Where significant progress has been made towards agreement with the relevant tax authority, the measurement basis agreed with the tax authorities is utilised. In recognising deferred tax assets, the deferred tax is calculated on temporary differences between the carrying amounts and the tax values of assets and liabilities. There is one primary area where assumptions and assessments affect recognised deferred tax. This relates to the assumptions and assessments used to determine the carrying amounts of the different assets and liabilities. Although the deferred tax assets which have been recognised are considered realisable, actual amounts could be reduced if future taxable income is lower than expected. This can affect the Group’s reported profit and financial position. Deferred tax assets have been recognised where management believes there are sufficient taxable temporary differences or convincing other evidence that sufficient taxable profit will be available in future to realise deferred tax assets.

5. BUSINESS AND GEOGRAPHICAL SEGMENTS Background The Group’s operations are based on two different business platforms – Skrill and paysafecard. Their performance is regularly reviewed by the Chief Operating Decision Maker (‘‘CODM’’). Within the Group, this function has been identiﬁed as being held by the Group’s Chief Executive Ofﬁcer, who is responsible for and manages the day-to-day management function of the Group in accordance with the Board’s guidelines. In the monthly performance in each of the markets the Group serves is dependent on resource allocation to these platforms, as well as client service and marketing.

Revenues from major products and services The Group’s revenues from its major products and services, all of which are continuing operations, were as follows:

6 months to 6 months to 12 months 30 June 30 June to 31 Dec 2015 2014 2014

Merchant revenue 128,312 95,200 220,658 End user revenue 25,618 18,051 41,918 Financial revenue 19,049 14,815 34,523

172,979 128,066 297,099

Financial revenue includes FX spread income and interest income from e-money ﬂoat.

198 Geographical information The Group’s revenues from external customers by geographical location are detailed below:

6 months to 6 months to 12 months 30 June 30 June to 31 Dec 2015 2014 2014

UK 10,444 5,681 12,940 Europe 117,245 92,195 212,562 Americas 5,474 3,139 8,638 Rest of the World 9,185 5,044 12,269 FX spread income 15,599 11,713 27,569 Other, including interest from e-money ﬂoat, maintenance fees and voucher fees 18,288 14,004 31,440 Rebates (3,256) (3,710) (8,319)

172,979 128,066 297,099

Information about major customers The Group did not have any single customer or distributor contributing more than 10 percent of total revenues during the period from 13 August 2013 to 31 December 2014 or in the period to 30 June 2015.

6. OPERATING PROFIT Operating proﬁt has been arrived at after charging:

6 months to 6 months to 12 months 30 June 30 June to 31 Dec 2015 2014 2014

Depreciation of PPE (note 16) 1,600 1,309 2,988 Rentals (operating leases) (note 29) 1,020 972 2,589 Amortisation of intangible assets (note 15) 21,576 7,705 41,604 Foreign exchange losses 942 385 862 Staff costs (note 9) 31,366 21,750 48,757 Non-recurring costs (note 7) 10,366 18,275 27,670 Cost of sales can be broken down as follows:

6 months to 6 months to 12 months 30 June 30 June to 31 Dec 2015 2014 2014

Purchased services and cost of materials 46,129 34,578 78,103 Transaction processing fees 13,514 10,619 23,578 Bad debt expenses 6,595 2,272 8,573 Referral bonus 3,011 2,941 6,760 Promotions 923 1,217 1,319

70,172 51,627 118,333

199 7. EBITDA RECONCILIATION EBITDA and Adjusted EBITDA are calculated as follows:

6 months to 6 months to 12 months 30 June 30 June to 31 Dec 2015 2014 2014

Operating proﬁt for the period 6,598 3,599 6,677 Add back: Depreciation (note 16) 1,600 1,309 2,988 Amortisation (note 15) 21,576 7,705 41,604

EBITDA 29,774 12,613 51,269 Non-recurring costs 10,366 18,275 27,670

Adjusted EBITDA 40,140 30,888 78,939

The items below highlight one off items which are in the income statement because separate disclosure is considered relevant in understanding the underlying performance of the business. These items are considered exceptional and are presented within the line items to which they best relate. An analysis of the amount presented as exceptional items in these ﬁnancial statements is given below.

6 months to 30 June 2014

Cash Non-cash Total

Integration related costs 1,025 — 1,025 Acquisition and sale related costs 16,996 — 16,996 Other 254 — 254

Charge to operating proﬁt 18,275 — 18,275

6 months to 30 June 2015

Cash Non-cash Total

Integration related costs 5,225 — 5,225 Acquisition and sale related costs 2,655 — 2,655 Other 380 2,106 2,486

Charge to operating proﬁt 8,260 2,106 10,366

12 months to 31 Dec 2014

Cash Non-cash Total

Integration related costs 2,848 — 2,848 Acquisition and sale related costs 23,776 — 23,776 Other 858 188 1,046

Charge to operating proﬁt 27,482 188 27,670

Integration related costs include certain one off costs incurred as Sentinel integrates the e-wallet and prepaid voucher business, and aligns around a clear set of shared goals. Also included are severance costs relating to restructure of senior management and support functions following these acquisitions.

200 Acquisition and sale related costs include costs associated with the acquisition of the e-wallet and prepaid voucher business, as well as other M&A related activities. Other costs include costs associated with onerous lease contracts and bonuses as part of restructuring.

8. AUDITORS’ REMUNERATION The analysis of auditors’ remuneration is as follows:

6 months to 6 months to 12 months 30 June 30 June to 31 Dec 2015 2014 2014

Fees payable to the auditors for the audit of Sentinel Topco Limited’s ﬁnancial statements — 13 25 Fees payable to the auditors and their associates for Sentinel Topco Limited’s subsidiaries 385 377 753

Total audit fees 385 390 778

Tax services 120 18 20 Transaction services 1,106 84 312 Other 1 18 50

Total non-audit fees 1,227 120 382

9. EMPLOYEE INFORMATION The average monthly number of employees (including executive directors) was:

12 months 6 months to 6 months to to 31 Dec 30 June 30 June 2014 2015 2014 Number

Management 10 9 11 Finance 84 88 83 Sales and marketing 178 167 165 Customer services 168 144 140 Administration 21 24 23 Information technology 200 197 190 Compliance and Risk 82 88 81 Human resources 18 23 20

761 740 713

Their aggregate remuneration comprised:

6 months to 6 months to 12 months 30 June 30 June to 31 Dec 2015 2014 2014

Wages and salaries 29,182 19,737 46,057 Social security costs 4,640 3,847 7,845 Less: capitalised costs (2,456) (1,834) (5,145)

31,366 21,750 48,757

Presentation of Directors’ remuneration disclosures As at the period end the Company had one director. No directors’ emoluments were due for the reported periods.

201 10. DIVIDENDS There were no dividends declared by the Group during the reported periods.

11. FINANCE INCOME

6 months to 6 months to 12 months 30 June 30 June to 31 Dec 2015 2014 2014

Finance income on bank deposits 25 5 40

25 5 40

12. FINANCE COSTS

6 months to 6 months to 12 months 30 June 30 June to 31 Dec 2015 2014 2014

Interest on bank borrowings 8,232 8,545 17,031 Amortisation of loan arrangement fee, issue costs and swap interest 2,395 8,997 11,607 Amortisation of issue costs on related party borrowings 336 312 699 Interest on related party borrowings 15,940 16,620 37,356 Dividend on preference shares 7,547 7,747 17,274

34,450 42,221 83,967

13. INCOME TAX EXPENSE

6 months to 6 months to 12 months 30 June 30 June to 31 Dec 2015 2014 2014

Current tax Current tax on proﬁts for the period 2,159 2,596 2,200 Adjustments in respect of prior periods — 1,572 1,518

2,159 4,168 3,718

Deferred tax Credit to the income statement (4,153) (1,917) (9,424)

(4,153) (1,917) (9,424)

Income tax expense (1,994) 2,251 (5,706)

202 UK corporation tax is calculated at 21.5% of the estimated taxable proﬁt for the period. This rate is calculated based on the prevailing rates from January to December 2014, which is the taxable period of the subsidiaries. Taxation for other jurisdictions is calculated at the rates prevailing in the respective jurisdictions. The tax on the Group’s loss before tax differs from the theoretical amount that would arise using the weighted average tax rate applicable to proﬁts of the consolidated entities as follows:

6 months to 6 months to 12 months 30 June 30 June to 31 Dec 2015 2014 2014

Loss before income tax (27,827) (38,617) (77,250)

Tax calculated at UK corporation tax rate (5,705) (8,293) (16,608) Tax effect of expenses/income that are not deductible/ taxable (115) 4,170 2,848 Effect of different tax rates in foreign subsidiaries (585) (7,465) (488) Other tax adjustments 4,411 12,267 7,024 Adjustments in respect of prior periods — 1,572 1,518

Income tax expense (1,994) 2,251 (5,706)

Factors affecting current and future tax charges The main rate of corporation tax in the UK reduced from 24% to 23% with effect from 1 April 2013 and from 23% to 21% with effect from 1 April 2014. Further rate reduction to 20% from 1 April 2015 was enacted on 2 July 2013 and therefore, any relevant deferred tax balances have been measured at this rate. The Austrian tax rate in all disclosed periods is ﬁxed at 25%.

14. GOODWILL

6 months to 6 months to 12 months 30 June 30 June to 31 Dec 2015 2014 2014

At the beginning of the period 389,922 — — Additions 26,773 617,520 389,922

At the end of the period 416,695 617,520 389,922

Goodwill acquired as at 12 February 2014 is allocated to both Group’s cash generating units (CGUs) – Legacy Skrill and Legacy psc. The Group tests goodwill annually for impairment or more frequently if there are indications that goodwill might be impaired. No impairment of goodwill was required during the period ended 31 December 2014. During the fourth quarter of 2014 an impairment test was carried which resulted in no impairment of goodwill. No indicators of impairment were identified during the 6 month period to 30 June 2015. For the cash generating units the Group prepares cash flow forecasts derived from the most recent financial budget approved by management. The cash flows are prepared for the next three years. These cash flows are then extrapolated for periods beyond the budget period at an estimated growth rate of 2.9%. The pre-tax discount rate used to discount the cash flows is 10.1%.

203 Changes in selling prices and direct costs are based on historical information and expectations of future changes in the market. We do not expect adverse changes in these conditions.

Other intangible assets

Software and Client Client Trade name website relationships relationships and domain development - merchants - end users name Total

Cost As at 1 January 2014 — — — — — Acquired on business combination* 41,173 115,136 5,602 6,214 168,125 Additions 4,060 — — 14 4,074

At 30 June 2014 45,233 115,136 5,602 6,228 172,199 Accumulated amortisation As at 1 January 2014 — — — — — Acquired on business combination* 18,020 26,474 5,568 3,393 53,455 Charge for the period (note 7) 1,966 5,223 — 516 7,705

At 30 June 2014 19,986 31,697 5,568 3,909 61,160 Net book amount At 30 June 2014 25,247 83,439 34 2,319 111,039

* Due to the fact that as at 30 June 2014 the acquisition accounting is not ﬁnalised these ﬁgures represents the cost and accumulated depreciation existed as at 12 February 2014

Cost At 1 January 2014 — — — — — Acquired on business combination** 24,038 272,887 87,138 21,853 405,916 Additions 19,452 — — 11 19,463

At 31 December 2014 43,490 272,887 87,138 21,864 425,379 Accumulated amortisation At 1 January 2014 — — — — — – Charge for the period (note 7) 9,267 20,949 7,451 3,937 41,604

At 31 December 2014 9,267 20,949 7,451 3,937 41,604 Net book amount At 31 December 2014 34,223 251,938 79,687 17,927 383,775

** Represent the actual Identiﬁed intangibles (based on PPA) acquired as a result of the acquisition of Skrill Group from Sentinel BidCo on 12 February 2014

Cost At 1 January 2015 43,490 272,887 87,138 21,864 425,379 Acquired on business combination (ukash)*** 5,309 — — — 5,309 Additions 7,818 — — 10 7,828

At 30 June 2015 56,617 272,887 87,138 21,874 438,516 Accumulated amortisation At 1 January 2015 9,267 20,949 7,451 3,937 41,604 Acquired on business combination (ukash)*** 4,512 — — — 4,512 Charge for the period (note 7) 7,539 9,997 3,564 476 21,576

At 30 June 2015 21,318 30,946 11,015 4,413 67,692 Net book amount At 30 June 2015 35,299 241,941 76,123 17,461 370,824

*** Due to the fact that as at 30 June 2015 the acquisition accounting regarding ukash is not ﬁnalised these ﬁgures represents the cost and accumulated depreciation existed as at 31 March 2015

204 15. OTHER INTANGIBLE ASSETS (CONTINUED) During the period ended 31 December 2014, internally generated intangible assets included within additions to the cost of software and website development were $8,506,000. As at 31 December 2014, internally generated intangible assets included within carrying amount of software and website development is $6,027,000. During the period ended 30 June 2015, internally generated intangible assets included within additions to the cost of software and website development were $4,356,000 (30 June 2014: $3,716,000). As at 30 June 2015, internally generated intangible assets included within carrying amount of software and website development is $13,137,000 (30 June 2014: $10,873,000). Software and website development includes the following amounts where the Group is a lessee under a ﬁnance lease:

As at As at As at 30 June 30 June 31 Dec 2015 2014 2014

Cost 751 751 751 Accumulated amortisation (360) (191) (282)

Net book amount 391 560 469 The duration of the lease contract is until February 2017 and ownership of the assets lies within the Group.

16. PROPERTY, PLANT AND EQUIPMENT

Fixtures, Computer ﬁttings and equipment equipment Total

Cost As at 13 August 2013 Acquired on business combination* 13,329 4,161 17,490 Additions 955 210 1,165 Disposals (5) — (5)

At 30 June 2014 14,279 4,371 18,650 Accumulated depreciation At 1 January 2014 Acquired on business combination* 7,629 1,613 9,242 Charge for the period (note 7) 1,044 265 1,309 Disposals (4) — (4)

At 30 June 2014 8,669 1,878 10,547 Net book amount At 30 June 2014 5,610 2,493 8,103

* Due to the fact that as at 30 June 2014 the acquisition accounting is not ﬁnalised these ﬁgures represents the cost and accumulated depreciation existed as at 12 February 2014

205 Fixtures, Computer ﬁttings and equipment equipment Total

Cost At 13 August 2013 Acquired on business combination** 12,996 4,141 17,137 Additions 3,140 582 3,722 Disposals (77) (211) (288)

At 31 December 2014 16,059 4,512 20,571 Accumulated depreciation At 13 August 2013 Acquired on business combination** 7,370 1,559 8,929 Charge for the period (note 7) 2,401 587 2,988 Disposals (77) (195) (272)

At 31 December 2014 9,694 1,951 11,645 Net book amount At 31 December 2014 6,365 2,561 8,926

** Represent the actual Identiﬁed intangibles (based on PPA) acquired as a result of the acquisition of Skrill Group from Sentinel BidCo on 12 February 2014

Cost At 1 January 2015 16,059 4,512 20,571 Acquired on business combination (ukash)*** 613 1,016 1,629 Additions 1,015 165 1,180 Disposals — (23) (23)

At 30 June 2015 17,687 5,670 23,357 Accumulated depreciation At 1 January 2015 9,694 1,951 11,645 Acquired on business combination (ukash)*** 465 570 1,035 Charge for the period (note 7) 1,272 328 1,600 Disposals — (18) (18)

At 30 June 2015 11,431 2,831 14,262 Net book amount At 30 June 2015 6,256 2,839 9,095

*** Due to the fact that as at 30 June 2015 the acquisition accounting regarding ukash is not ﬁnalised these ﬁgures represents the cost and accumulated depreciation existed as at 31 March 2015

206 Computer equipment includes the following amounts where the Group is a lessee under a ﬁnance lease:

As at As at As at 30 June 30 June 31 Dec 2015 2014 2014

Cost 344 344 344 Accumulated depreciation (165) (87) (129)

Net book amount 179 257 215

The duration of the lease contract is until February 2017 and ownership of the assets lies within the Group.

17. SUBSIDIARIES All subsidiary undertakings are included in the consolidation. The proportion of the voting rights in the subsidiary undertakings held directly by the parent company does not differ from the proportion of the ordinary shares. The entity directly held by the Company is Sentinel Holdco 2 Limited. The Group’s investments in the ordinary share capital of subsidiary companies at the balance sheet date include the following:

Proportion Place of of interest in Proportion incorporation (or ordinary of voting Name registration) Operations shares power held

Sentinel Holdco 2 Limited England and Wales Holding company 100% 100% Sentinel MIDCO Limited England and Wales Holding and consultancy 100% 100% services company Sentinel BIDCO Limited England and Wales Holding and consultancy 100% 100% services company 100% 100% Skrill Group Limited Jersey Holding and consultancy services company Skrill Capital Limited Jersey Non trading company 100% 100% Digital Payments Europe Limited England and Wales Non trading company 100% 100% Digital Payment Solutions New Zealand Ltd. New Zealand Non trading company 100% 100% Digital Payment Solutions Australia Pty Ltd. Australia Non trading company 100% 100% MB Acquisitions Limited England and Wales Holding and consultancy 100% 100% services company Skrill Holdings Limited England and Wales Holding and consultancy 100% 100% services company MB Employee Nominees Limited England and Wales Non trading company 100% 100% Skrill Limited England and Wales Electronic money transfer 100% 100% services Skrill Bulgaria EOOD Bulgaria Consultancy, development 100% 100% and implementation of software Skrill USA, Inc. United States of Online Payment service 100% 100% America provider and electronic money transfer services Skrill International Payments Limited England and Wales Consulting services to group 100% 100% companies Skrill Capital UK Limited England and Wales Non trading company 100% 100% Payolution GmbH Austria Payment facilitator enabling 100% 100% online merchants to offer their customers payments solutions Payolution Schweiz GmbH Switzerland Payment facilitator enabling 100% 100% online merchants to offer their customers payments solutions Skrill Services GmbH Germany Consulting services to group 100% 100% companies Skrill Canada Inc. Canada Non trading company 100% 100% Skrill Hong Kong Limited Hong Kong Non trading company 100% 100% Skrill Singapore Limited Singapore Non trading company 100% 100% Sabemul Beteiligungsverwaltungs Austria Holding company 100% 100% GmbH

207 Proportion Place of of interest in Proportion incorporation (or ordinary of voting Name registration) Operations shares power held paysafecard.com Wertkarten GmbH Austria Holding, development and 100% 100% (formerly AG) consultancy services company paysafecard.com Wertkarten Austria Distribution and merchant 100% 100% Vertriebs GmbH services cpt Dienstleistungen GmbH Germany Distribution services 100% 100% Prepaid Services Company Limited England and Wales Issuing of electronic money, 100% 100% distribution and merchant services paysafecard.com Schweiz GmbH Switzerland Issuing and distribution 100% 100% services MAC Limited Gibraltar Merchant services 100% 100% paysafecard.com Argentina S.R.L. Argentina Issuing, distribution and 100% 100% merchant services paysafecard.com Me´xico SA de CV Mexico Issuing, distribution and 100% 100% merchant services paysafecard.com USA Inc. United States of Distribution and merchant 100% 100% America services paysafecard O¨ nO¨ deme Servisleri Turkey Issuing, distribution and 100% 100% Limited Sirketi merchant services paysafecard.com d.o.o. Croatia — 100% 100% (in liquidation) Smart Vourcher Limited England and Wales Electronic money transfer 100% 100% services Pebblestone Holding Limited Gibraltar Consulting & ﬁnancial services 100% 100% Quick Cash Limited England and Wales Non trading company 100% 100% Smart E-money Limited England and Wales Non trading company 100% 100% Ukash Limited England and Wales Non trading company 100% 100% Universal E-Cash Limited England and Wales Non trading company 100% 100%

18. INVESTMENTS

As at As at As at 30 June 30 June 31 Dec 2015 2014 2014

Available for sale investments 361 845 336 Convertible bonds 112 137 133 Net foreign exchange difference (130) (8) 4

343 974 473

As at As at As at 30 June 30 June 31 Dec 2015 2014 2014

Balance as the beginning of the period 473 — — Acquired during the period: – Available for sale investments — 981 839 – Convertible bonds — — 137 Change in the value of available for sale ﬁnancial asset (130) (7) (503)

Balance at the end of the period 343 974 473

208 Trade investments represent an investment in Cybits Holding AG, a company listed in Germany. The investment is revalued each month based on its fair value. The convertible bonds are issued by Cybits AG, a wholly owned subsidiary of Cybits Holding AG.

19. INVENTORIES

As at As at As at 30 June 30 June 31 Dec 2015 2014 2014

Vouchers 861 391 828 Cards 149 210 193 Security tokens 65 127 93

1,075 728 1,114

Cost of inventories amounting to $0 (zero) was impaired and recognised as an expense (period ended 30 June 2015: $0(zero), period ended 31 December 2014: $38,000).

20. TRADE AND OTHER RECEIVABLES

As at As at As at 30 June 30 June 31 Dec 2015 2014 2014

Trade receivables 88,110 116,948 119,574 Other debtors 9,208 12,573 9,097 Prepayments and accrued income 7,627 6,736 5,809 Related party receivables (note 32) 871 879 929

105,816 137,136 135,409

The trade receivables above primarily relate to amounts due from payment service providers and distribution partners. There are no trade receivables considered to be impaired. Provisions amounting to $1,614,000 (31 December 2014: $1,614,000, 30 June 2014: $1,877,000) are included in receivables to cover the payment default risk of distribution partners, to the extent it is not covered by insurance. The directors consider that the carrying amount of trade receivables is approximately equal to their fair value.

21. DERIVATIVE FINANCIAL INSTRUMENTS

As at As at As at 30 June 30 June 31 Dec 2015 2014 2014

Interest rate swaps – cash ﬂow hedge 3,884 5,131 5,223 3,884 5,131 5,223

Current 2,070 2,080 2,116 Non-current 1,814 3,051 3,107

3,884 5,131 5,223

The full fair value of a hedging derivative is classiﬁed as a non-current liability if the remaining maturity of the hedged item is more than 12 months and, as a current liability, if the maturity of the hedged item is less than 12 months. The variable interest rate is based on 3-month EURIBOR and varies from 0.0820 to 0.3130. Gains and losses recognised in the hedging reserve in equity on interest rate swap contracts as of

209 31 December 2014 will be continuously released to the income statement within ﬁnance cost until the end of 2018.

22. BORROWINGS As at As at As at 30 June 30 June 31 Dec 2015 2014 2014

Bank borrowings 321,966 358,043 318,673 Related party borrowings (note 32) 213,563 288,192 257,079 Interest on related party borrowings (note 32) 44,103 15,381 34,247 Preference shares (note 32) 110,944 136,452 121,548 Cumulative dividend on preference shares (note 32) 21,951 7,697 15,836 Finance lease liabilities 387 759 555

712,914 806,524 747,938 Current Finance lease liabilities 230 278 252

230 278 252 Non-current Bank borrowings 321,966 358,043 318,673 Related party borrowings 213,563 288,192 257,079 Interest on related party borrowings 44,103 15,381 34,247 Preference shares 110,944 136,452 121,548 Cumulative dividend on preference shares 21,951 7,697 15,836 Finance lease liabilities 157 481 303

712,684 806,246 747,686

Bank borrowings A Senior Finance Agreement was signed dated 16 August 2013 and amended and restated by an amendment and restatement agreement dated 29 January 2014 between Sentinel Midco Limited, Sentinel Bidco Limited, Credit Suisse AG, London Branch, Jefferies Finance LLC and The Royal Bank of Scotland Plc. The Senior Facilities Agreement is for a total principal amount of $419,863,000 segregated into Facility B ($378,565,000) and Revolving Facility ($41,298,000) and is repayable over 7 years and 6 years respectively. Sentinel Bidco Limited drew down $375,595,000 of Facility B on 11 February 2014. The Facilities Agreement has ﬁnancial covenants in respect of (i) interest cover, and (ii) debt cover. Interest cover: as at 31 December 2014, interest cover (ratio of consolidated pro-forma EBITDA to net interest expenses) shall not be less than 2.50:1. Debt cover (leverage ratio): as at 31 December 2014, debt cover (ratio of total net debt to consolidated pro-forma EBITDA) shall not exceed 5.30:1. The covenants described above are tested by reference to the relevant ﬁnancial statements for the relevant Quarter Date and are agreed to the required ratios. The Group is in full compliance with the requirements of the bank covenants. The security against the loan is per the English law debenture over certain assets of Sentinel Midco Limited (including the entire share capital of Sentinel Bidco Limited), certain assets of Sentinel Bidco Limited and Jersey law share pledge agreement over the entire issued share capital of Skrill Group Limited. Security is also provided over certain assets of Skrill Group Limited, MB Acquisitions Limited, Skrill Holdings Limited, Skrill Limited, paysafecard.com Wertkarten GmbH, paysafecard.com Wertkarten Vertriebs GmbH, Sabemul Beteilligungsvewaltungs GmbH and MAC Limited. There is another loan in place between Payolution GmbH and Austrian Research Promotion Agency for the amount of $53,000 (for the period ended 30 June 2014 $65,000, for the period ended 31 December 2014: $58,000. The annual interest rate is 2% and is paid annually. The total amount of the principal is due on 31 March 2018.

210 Finance lease The ﬁnance lease is held by paysafecard.com Wertkarten GmbH from Raiffeisen-Leasing O¨ sterreich GmbH, Vienna for the duration of 48 months until February 2017. The interest rate is 3 month Euribor plus spread.

Related party borrowings Sentinel Holdco 2 Limited, a subsidiary of Sentinel Topco Limited, issued $296,347,000 ﬁxed rate unsecured loan notes 2024 (the ‘‘Notes’’) and ﬁxed rate subordinated unsecured payment in kind note (the ‘‘PIK Notes’’) to Sentinel Group Holdings S.A., which are due in 2024. The balance as at 31 December 2014 has been shown net of amortised issue costs of $6,652,000. The issue costs are amortised over the duration of the loan.The loan notes were issued on 12 February 2014 and interest is accruing during the period from and including the date of issue and ending on the day preceding the due date for redemption. Sentinel Holdco 2 Limited shall redeem the Notes and the PIK Notes at par, together with accrued interest (after deduction of tax), on the earlier of the redemption date (12 February 2024) or a listing, sale or asset sale. Redemption shall be made pari passu among the noteholders after giving notice to the noteholders not less than seven nor more than thirty days’ notice. Sentinel Holdco 2 Limited shall cancel a Note or PIK Note redeemed or purchased and may not re issue or resell that Note or PIK Note. The agreement with Paysafe Group plc disclosed in note 35, if approved, shall constitute such a redemption event. On 30 January 2015 Sentinel Holdco 2 Limited voluntary repaid principal at $23,467,000 and accrued interest at $3,273,000.

Preference shares Sentinel Topco Limited issued $136,580,000 preference shares to Sentinel Group Holdings on 12 February 2014. The preference shares shall confer on the holder a right to be paid a ﬁxed cumulative preferential dividend of the issue price of the preference share. No preference share shall confer upon the holder any rights to vote at general meetings of the Company. Subject to the law, each preference share shall be redeemed in the following circumstances: * the majority preference shareholders are entitled to require early redemption on events of default; * the majority preference shareholders may require the Company to redeem all or some of the preference shares at any time by serving a notice to the Company. Sentinel Topco Limited shall redeem all of the preference shares immediately before but conditional on a sale or a listing. The agreement with Paysafe Group plc disclosed in note 35, if approved, shall constitute such a redemption event. The preference shares are treated as debt.

211 23. DEFERRED TAX ASSETS AND LIABILITIES The analysis of deferred tax assets and deferred tax liabilities is as follows:

As at As at As at 30 June 30 June 31 Dec 2015 2014 2014

Deferred tax assets: * Recoverable after more than 12 months 4,983 2,158 4,150 * Recoverable within 12 months 2,605 647 1,196

7,588 2,805 5,346

Deferred tax liabilities * Recoverable after more than 12 months (65,880) (18,873) (69,582) * Recoverable within 12 months (10,040) (3,712) (10,569)

(75,920) (22,585) (80,151)

Deferred tax liabilities (net) (68,332) (19,780) (74,805)

Deferred tax assets are recognised for the tax losses carried forward to the extent that the realisation of the related tax benefit through future taxable profits is probable. As at 30 June 2015 the Group recognised a deferred tax asset amounting to $2,478,000 (for the period ended 30 June 2014: $1,054,000, for the period ended 31 December 2014: $2,478,000) for the accumulated losses as they can be carried forward against future taxable income. Tax losses can be carried forward for an indefinite period of time.

24. TRADE AND OTHER PAYABLES

As at As at As at 30 June 30 June 31 Dec 2015 2014 2014

Trade payables 143,275 151,373 164,188 E-money ﬂoat 520,976 533,960 560,949 Other payables 13,816 8,743 9,146 Accruals 24,045 20,494 21,518

702,112 714,570 755,801

Trade payables and accruals principally comprise amounts outstanding for trade purchases and ongoing costs as well as liabilities to web-shops (merchants). The Group has ﬁnancial risk management policies in place to ensure that all payables are paid within the pre-agreed credit terms. The Skrill e-money ﬂoat represents monies that have been deposited by both end customers and merchants whereas the paysafecard e-money relates to unused balances held on the cards. The directors consider that the carrying amount of trade payables approximates to their fair value.

212 25. SHARE CAPITAL Authorised, allotted and fully paid The Company was established on 13 August 2013 with 2 ordinary shares with par value 0.01 EUR. On 10 February 2014, the Company issued, at nominal value, 1,385,728,800 ordinary shares of 0.01 EUR each which were fully subscribed by its sole shareholders Sentinel Group Holdings SA, a company registered in Luxemburg. On 12 February 2014 the Company issued a further 441,871,200 ordinary shares of 0.01 EUR each which were fully subscribed by its sole shareholders Sentinel Group Holdings S.A.

As at As at As at Nominal 30 June 30 June 31 Dec Number Class value 2015 2014 2014

EUR‘000 EUR‘000 EUR‘000 1,827,600,002 Ordinary EUR 0.01 18,276 18,276 18,276 Revaluated Revaluated Revaluated to: to: to: USD‘000 USD‘000 USD‘000 24,961 24,961 24,961 26. OTHER RESERVES

Available Translation Revaluation for sale reserve reserve reserve Total

Balance as at 13 August 2013 ———— Other comprehensive income (expense) for the period (12) — (8) (20) FX 2 (8) 5 (1)

Balance as at 30 June 2014 (10) (8) (3) (21)

Available Translation Revaluation for sale reserve reserve reserve Total

Balance as at 13 August 2013 ———— Other comprehensive income (expense) for the period 589 (21) (488) 80 FX 17 — (15) 2

Balance as at 31 December 2014 606 (21) (503) 82

Available Translation Revaluation for sale reserve reserve reserve Total

Balance as at 31 December 2014 606 (21) (503) 82 Other comprehensive income (expense) for the period 1,122 — (130) 992 FX (1) (1) 2 —

Balance as at 30 June 2015 1,727 (22) (631) 1,074

213 27. NOTES TO THE CASH FLOW STATEMENT

6 months to 6 months to 12 months 30 June 30 June to 31 Dec 2015 2014 2014

Operating proﬁt 6,598 3,599 6,677 Adjustments for: Depreciation and amortisation (note 15 and 16) 23,176 9,014 44,592 Deposit income (3,170) (2,988) (6,847)

Operating cash ﬂows before movements in working capital 26,604 9,625 44,422 Decrease in inventories 70 (580) 220 Increase in trade and other receivables 28,848 (25,342) (31,803) Increase in trade and other payables (35,400) 46,768 152,109

Cash generated by operations 20,122 30,471 164,948 Income tax paid 676 (1,297) (6,421) Interest paid (11,074) (7,673) (17,613) Interest received 3,222 2,572 6,063

Net cash generated from operating activities 12,946 24,073 146,977

Cash and cash equivalents

As at As at As at 30 June 30 June 31 Dec 2015 2014 2014

Cash and cash equivalents 662,262 656,045 701,853 Cash and cash equivalents comprise cash. The carrying amount of these assets is approximately equal to their fair value. In accordance with an agreement with a speciﬁc provider certain cash is restricted and is based upon the highest of 4 days authorised or settlement liability in any period. Such sums are calculated by the provider. As at 30 June 2015 the cash balances include an amount of $128,000 (as at 30 June 2014: $6,478,000, as at 31 December 2014: $5,377,000) relating to restricted cash. Skrill Limited and Prepaid Services Company Limited, FCA regulated entities, are required at all times to have qualifying liquid assets (comprising cash and cash equivalents and investments) in excess of the e-money ﬂoat (see note 31).

28. BUSINESS COMBINATIONS On 31 March 2015, the Group acquired 100% of the issued share capital of Smart Voucher Limited (‘‘Ukash’’), the UK prepaid payments business.

214 The following table summarises the consideration paid for Ukash, the fair value of assets acquired and liabilities assumed at the acquisition date.

As at 31 March 2015

Cash 49,651

Total Consideration 49,651

Recognised amounts of identiﬁable assets acquired and liabilities assumed: Cash and cash equivalents 47,295 Trade and other receivables 9,426 Inventory 34 Fixed assets 594 Intangible assets 797 Deferred tax assets 1,055 Loan receivables 13,111 Trade and other payables (40,661) E-money ﬂoat (8,265) Income tax liabilities (2) Financial liabilities (8,034)

Total identiﬁable net assets 22,878

Goodwill as at 31 March 2015 (note 14) 26,773

Acquisition-related costs have been charged to administrative expenses in the consolidated income statement for the period ended 30 June 2015. During the 6 month period to 30 June 2015 the revenue included in the consolidated statement of comprehensive income contributed by Ukash was $11,471,000. Ukash also contributed proﬁt after tax of $1,804,000 over the same period. Had Ukash been consolidated from 1 January 2015, the consolidated statement of income for 6 months 2015 would show pro-forma revenue of $184,199,000 and loss after tax of $23,865,000. On 12 February 2014, CVC Capital Partners completed the acquisition of a controlling stake in Skrill Group Limited pursuant to a share purchase agreement dated 16 August 2013.

215 The following table summarises the consideration paid for the fair value of assets acquired and liabilities assumed at the acquisition date.

As at 12 February 2014

Consideration paid 570,056

Total Consideration 570,056

Recognised amounts of identiﬁable assets acquired and liabilities assumed: Cash and cash equivalents 639,153 Trade and other receivables 111,751 Inventory 1,359 Fixed assets (note 16) 8,208 Intangibles (note 15) — Deferred tax assets 2,911 Loan receivables — Investments 975 Trade and other payables (182,684) E-money ﬂoat (487,644) Income tax liabilities (7,908) Provisions (79,782) Financial liabilities (143,524)

Total identifiable net assets (137,185) Identified Intangible Assets (note 15) 405,916 Deferred tax liability on identified intangible assets (88,597)

Goodwill at the date of acquisition 389,922

29. OPERATING LEASE (a) Operating lease expenses during the period

6 months to 6 months to 12 months 30 June 30 June to 31 Dec 2015 2014 2014

Minimum lease payments under operating leases recognised as an expense in the period (note 6) 1,020 972 2,589

1,020 972 2,589

(b) Operating lease commitments – the Group as lessee At the balance sheet date, the Group had outstanding commitments for future minimum lease payments under non-cancellable operating leases, which fall due as follows:

As at As at As at 30 June 30 June 31 Dec 2015 2014 2014

Within one year 1,783 2,353 2,326 In the second to ﬁfth years inclusive 4,597 6,017 6,123 More than ﬁve years 1,198 2,163 2,229

7,578 10,553 10,678

Operating lease payments represent rentals payable by the Group for certain of its ofﬁce properties. Leases are negotiated for an average term of 10 years and rentals are ﬁxed for an

216 average of 5 years with an option to extend for a further 5 years at the then prevailing market rate.

30. Financial instruments Financial risk factors The Group’s activities expose it to a variety of financial risks: market risk (including currency risk, fair value interest rate risk and cash flow interest rate risk), credit risk and liquidity risk. The Group’s overall risk management programme focuses on the unpredictability of financial markets and seeks to minimise potential adverse effects on the Group’s financial performance.

Market risk The Group’s activities expose it primarily to the ﬁnancial risks of changes in foreign currency exchange rates and interest rates (see below). The Group operates internationally and is exposed to foreign exchange risk arising from various currency exposures, primarily with respect to the US dollar and the British Pound. Foreign exchange risk arises from future commercial transactions, recognised assets and liabilities and net investments in foreign operations. Foreign exchange risk arises when future commercial transactions or recognised assets or liabilities are denominated in a currency that is different than EUR, the Group’s functional currency. The carrying amounts of the Group’s foreign currency denominated monetary assets and monetary liabilities at the reporting date are as follows:

Foreign currency risk management

Liabilities Assets

As at As at 30 June 30 June 2014 2014

United Kingdom (GBP) 40,356 44,741 USA (USD) 146,142 153,179 Other 80,225 92,880

Liabilities Assets

As at As at 30 June 30 June 2015 2015

United Kingdom (GBP) 53,667 69,971 USA (USD) 154,459 166,114 Other 80,528 99,875

Liabilities Assets

As at As at 31December 31December 2014 2014

United Kingdom (GBP) 44,596 55,906 USA (USD) 157,446 164,119 Other 84,043 109,573 Foreign currency sensitivity analysis The Group is mainly exposed to the currency of the United Kingdom (GBP) and the currency of the United States of America (USD). The Group is required to disclose the impact of a deﬁned change in the relative strength of its functional currency against other foreign currencies that the Group is exposed to. The Group has

217 determined that 10 per cent is the sensitivity rate used when reporting foreign currency risk internally to key management personnel and represents management’s assessment of the reasonably possible change in foreign exchange rates. The following table details the Group’s sensitivity to a 10 per cent strengthening of GBP against Euro and USD against Euro taking into account the outstanding foreign currency denominated monetary items at the period end:

GBP impact USD impact

As at As at 30 June 30 June 2014 2014

Proﬁt /(loss) for a 10% strengthening of the relevant currencies against Euro* 344 553

GBP impact USD impact

As at As at 30 June 30 June 2015 2015

Proﬁt /(loss) for a 10% strengthening of the relevant currencies against Euro* 1,305 933

GBP impact USD impact

As at As at 31December 31December 2014 2014

Proﬁt /(loss) for a 10% strengthening of the relevant currencies against Euro* 968 571

* A 10% weakening of the relevant currencies against Euro would have the opposite effect on the Group’s result for the period.

Interest rate risk management The Group has policies and procedures that set out the specific guidelines that must be followed to manage the interest rate risk. The Group manages any exposure to interest rate fluctuations by predominantly investing funds in financial instruments with short-term maturities in line with applicable FCA rules and regulations. The Group’s exposures to interest rates on financial assets and financial liabilities are detailed in the liquidity risk management section of this note. Based on the various scenarios, the Group manages its cash flow interest rate risk by using floating-to-fixed interest rate swaps. Such interest rate swaps have the economic effect of converting borrowings from floating rates to fixed rates. Generally, the Group raises long-term borrowings at floating rates and swaps them into fixed rates that are lower than those available if the Group borrowed at fixed rates directly. Under the interest rate swaps, the Group agrees with other parties to exchange, at specified intervals (quarterly), the difference between fixed contract rates and floating-rate interest amounts calculated by reference to the agreed notional amounts. These swaps are designated to hedge underlying debt obligations. The Group hedges 85% of its bank borrowings as at end of 2014, 92% as at end of June 2014 and 71% as at end of June 2015. Interest rate sensitivity analysis The sensitivity analysis below has been determined based on the exposure to interest rates for non-derivative instruments at the balance sheet date. For floating rate liabilities, the analysis is prepared assuming the amount of liability outstanding at the balance sheet date was outstanding for the whole period. A 1 percent increase or decrease is used when reporting interest rate risk

218 internally to key management personnel and represents management’s assessment of a reasonably possible change in interest rates. If interest rates had been 1 percent higher/lower and all other variables were held constant, the Group’s: * result for the period ended 30 June 2015 would increase/decrease by $3,378,000; * result for the period ended 30 June 2014 would increase/decrease by $3,785,000. * result for the period ended 31 December 2014 would increase/decrease by $3,653,000.

Credit risk Credit risk refers to the risk that a counter party will default on its contractual obligations resulting in financial loss to the Group. The Group has adopted a policy of only dealing with counterparties rated by external independent agencies as creditworthy and obtaining sufficient collateral where appropriate, as a means of mitigating the risk of financial loss from defaults. This information is supplied by independent rating agencies where available, and if not available, the Group uses other publicly available financial information and its own trading records to rate its major customers. The Group’s exposure and the credit ratings of its counterparties are continuously monitored. Credit exposure is controlled by counterparty limits that are reviewed and approved by the risk management committee annually. Trade receivables consist of a large number of customers, spread across diverse industries and geographical areas. Ongoing credit evaluation is performed on the financial condition of accounts receivable and, where appropriate, credit guarantee insurance cover is purchased. The Group does not have any significant credit risk exposure to any single customer or any Group of customers having similar characteristics. The Group considers customers as having similar characteristics if they are related entities.

219 The credit risk on liquid funds is limited because the counterparties are banks with high credit- ratings assigned by international credit-rating agencies as shown below.

As at As at As at 30 June 30 June 31December 2015 2014 2014

Cash and cash equivalents (note 27) Standard and Poor‘s, Fitch and Moody’s credit ratings A+ — 86,516 27,588 AA+ 359 332 700 AA- 132 5,446 (1,454) A1 11,841 — — A 14,763 90,720 129,784 A- 1,806 86,944 126,585 A2 94,149 — — A3 41,897 — 44 Aa2 3,205 — 955 Aa3 36,547 — — Ba1 2,311 194 — Ba2 3,737 1,098 1 Ba3 1,444 — — Baa1 30,420 — — Baa2 88,422 — — Baa3 57,652 — — B1 — — 4,038 B2 156 — — B — 4,527 — B- 296 — — B3 6 76,770 — BB 2,183 890 6,682 BB- — 283 101 BB+ 44,925 83,910 50,821 BBB 73,344 99,483 13,942 BBB+ 58,627 75 3,685 BBB- 20,158 79,849 293,207 Caa3 32 — — CC — — 306 CC+ — — 86 CCC 156 457 143 Other 73,694 38,551 44,639

662,262 656,045 701,853

Other relates mostly to balances in financial institutions, which are not rated by independent rating agencies. These accounts are opened in order to accommodate merchants and end users in countries where a local bank is required to facilitate deposits and/or withdrawals. In order to mitigate the risk of default, the balances in the above mentioned institutions are continuously monitored by the treasury functions and reviewed on a continuous basis by the risk management committee. The carrying amount of financial assets recorded in the financial information, which is net of impairment losses, represents the Group’s maximum exposure to credit risk as no collateral or other credit enhancements are held.

Liquidity risk management Liquidity risk refers to the risk that an entity will not have sufﬁcient funds available at any given time to meet its obligations on time. As part of established management mechanisms, rolling ﬁnancial planning is monitored at management level.

220 paysafecard.com Wertkarten GmbH is obliged to provide for permanent coverage of the balances kept with the partner banks. These balances include incoming payments from distribution partners and outgoing payments to merchants. A permanent liquidity is guaranteed by a deliberate system of setting payment dates and paysafecard.com Wertkarten GmbH normally does not have to advance funds for the purpose of securing liquidity. A liquidity risk results from potential late payments by distribution partners. To minimise the liquidity risk, incoming payments are checked daily and in case of delayed payments adequate measures (reminder, delivery stop etc.) are taken immediately. The Group has significant net cash balances as at the balance sheet date. Liquidity risk is monitored on a daily basis and is kept within the FCA requirements for e-money issuers. Management closely monitors the cash position of the Group on a continuous basis to ensure sufficient liquidity exists for business needs. The Group has positive cash flows from operating activities, and the cash balances are adequate to finance the ongoing working capital and capital investment requirements of the Group’s operations. The Group balances the flexible use of funding by way of loans to / from Group companies. The following tables detail the Group’s remaining contractual maturity for its financial liabilities with agreed repayment periods. The tables have been drawn up based on the contractual undiscounted cash flows of financial liabilities based on the earliest date on which the Group can be required to pay.

Less than Between 1 Between 2 Over 1 year and 2 years and 5 years 5 years Total

As at 30 June 2015 Trade payables (note 24) 143,275 — — — 143,275 E-money ﬂoat (note 24) 520,976 — — — 520,976 Other payables and accruals (note 24) 37,861 — — — 37,861 Derivatives (note 21) 2,070 1,345 469 — 3,884 Bank borrowings (note 22) — — 53 335,051 335,104 Related party borrowings (note 22) — — — 219,303 219,303 Interest on related party borrowings (note 22) — — — 44,103 44,103 Preference shares (note 22) — — — 110,944 110,944 Dividend on preference shares (note 22) — — — 21,951 21,951 Finance lease (note 22) 230 157 — — 387

704,412 1,502 522 731,352 1,437,788

221 Less than Between 1 Between 2 Over 1 year and 2 years and 5 years 5 years Total

As at 30 June 2014 Trade payables (note 24) 151,373 — — — 151,373 E-money ﬂoat (note 24) 533,960 — — — 533,960 Other payables and accruals (note 24) 29,237 — — — 29,237 Derivatives (note 21) 2,080 1,229 1,822 — 5,131 Bank borrowings (note 22) — — 65 375,243 375,308 Related party borrowings (note 22) — — — 296,070 296,070 Interest on related party borrowings (note 22) — — — 15,381 15,381 Preference shares (note 22) — — — 136,452 136,452 Dividend on preference shares (note 22) — — — 7,697 7,697 Finance lease (note 22) 278 282 199 — 759

716,928 1,511 2,086 830,843 1,551,368

Less than Between 1 Between 2 Over 1 year and 2 years and 5 years 5 years Total

As at 31 December 2014 Trade payables (note 24) 164,188 — — — 164,188 E-money ﬂoat (note 24) 560,949 — — — 560,949 Other payables and accruals (note 24) 30,664 — — — 30,664 Derivatives (note 21) 2,116 1,698 1,409 — 5,223 Bank borrowings (note 22) — — 58 334,257 334,315 Related party borrowings (note 22) — — — 263,731 263,731 Interest on related party borrowings (note 22) — — — 34,247 34,247 Preference shares (note 22) — — — 121,548 121,548 Dividend on preference shares (note 22) — — — 15,836 15,836 Finance lease (note 22) 252 258 45 — 555

758,169 1,956 1,512 769,619 1,531,256

Maturity of ﬁnancial assets The Group’s ﬁnancial assets consist of loans and receivables (cash and cash equivalents and trade and other receivables) which have a maturity of less than 3 months, available for sale investments and convertible bonds. At 31 December 2014, there are no investments that have a maturity date within 3 months.

Capital management The Group manages its capital to ensure that entities in the Group will be able to continue as a going concern while maximising the return to stakeholders through the optimisation of the debt and equity balance. The capital structure of the Group consists of debt, which includes the borrowings disclosed in note 22 and equity attributable to equity holders of Sentinel Topco Limited, comprising issued capital, reserves and accumulated loss.

222 Fair value of financial instruments Fair value of financial instrument carried at amortised cost The Directors consider that the carrying amounts of financial assets and financial liabilities recorded at amortised cost in the financial information approximate their fair values. All fair value measurements are those derived from quoted prices (unadjusted) in active markets for identical assets or liabilities. Valuation techniques and assumptions applied for the purposes of measuring fair value The fair values of financial assets and financial liabilities are determined with standard terms and conditions, are traded on active liquid markets and are determined with reference to quoted market prices (includes listed bonds). The following table presents the Group’s assets and liabilities that are measured at fair value at the respective period ends.

Financial instruments by category As at As at As at 30 June 30 June 31December 2015 2014 2014

Assets as per balance sheet Available for sale investment (note 18) 361 845 336 Convertible bonds (note 18) 112 137 133 Loans and receivables – Trade and other receivables (note 20) 98,189 130,399 129,600 – Cash and cash equivalents (note 27) 662,262 656,045 701,853

TOTAL FINANCIAL ASSETS 760,924 787,426 831,922

Liabilities as per balance sheet Financial liabilities at amortised cost Trade and other payables (note 24) 702,112 714,570 755,801 Bank borrowings (note 22) 321,966 358,043 318,673 Related party borrowings (note 22) 213,563 288,192 257,079 Interest on related party borrowings (note 22) 44,103 15,381 34,247 Preference shares (note 22) 110,944 136,452 121,548 Cumulative dividend on preference shares (note 22) 21,951 7,697 15,836 Finance lease liabilities (note 22) 387 759 555 Derivative ﬁnancial instruments Cash ﬂow hedge (note 21) 3,884 5,131 5,223

TOTAL FINANCIAL LIABILITIES 1,418,910 1,526,225 1,508,962

The available for sale investment and the convertible bonds are classified as financial assets at Level 1 (quoted prices in active markets for identical assets or liabilities). The derivative financial instrument is classified at Level 2 (inputs other than quoted prices).

31. FCA REGULATORY CAPITAL REQUIREMENTS The Group has four entities that are registered with the FCA: Skrill Limited, Skrill International Payments Limited, Prepaid Services Company Limited and Smart Voucher Ltd. Skrill Limited: A minimum amount of capital is required by the FCA. The FCA’s regulatory requirement is, at any time, for Skrill Limited to have initial capital in excess of e350,000 and hold regulatory own funds which are 2% of the average daily outstanding e-money amount at the end of each calendar day over the preceding 6 month period.

223 The FCA regulatory capital requirements and Skrill Limited’s regulatory own funds at the respective period ends are as follows: As at As at As at 30 June 30 June 31December 2015 2014 2014

FCA regulatory capital requirements 9,278 9,032 8,950 Regulatory own funds 158,415 158,590 186,752 Skrill Limited, an FCA regulated entity, is required at all times to have qualifying liquid assets in excess of the e-money ﬂoat. The balances are as per the table below. Qualifying liquid assets of Skrill Limited are made up of cash and cash equivalent. Skrill Limited was in compliance with the requirement for the periods ended 30 June 2014, 30 June 2015 and 31 December 2014.

Skrill Limited As at As at As at 30 June 30 June 31December 2015 2014 2014

Qualifying liquid assets 494,926 484,389 516,990 E-money ﬂoat 452,706 467,031 489,823

Skrill International Payments Limited During 2011, Next Generation Payments Limited was registered as an Authorised Payment Institution in the UK and is regulated by the FCA under the Payment Services Regulations 2009 (‘‘PSRs’’). No revenues were earned through the provision of this service during the period, ended 31 December 2014. The FCA’s regulatory requirement is to have initial capital of e50,000.

Skrill International Payments Limited As at As at As at 30 June 30 June 31December 2015 2014 2014

FCA regulatory initial capital requirements 55 68 61 Regulatory own funds 1,355 1,059 940

Prepaid Services Company Limited Prepaid Services Company Limited (‘‘PSC Limited’’) is required by The Electronic Money Regulations 2011 (‘‘EMRs’’) and by the implementing rules specified by the Financial Conduct Authority (‘‘FCA’’) to maintain a specified minimum amount of own funds (capital). The FCA requires that, as an authorised electronic money institution (‘‘AEMI’’), PSC Limited must hold, at all times, capital equal to or in excess of either e350,000 or 2% of the average daily outstanding e- money amount at the end of each calendar day over the preceding 6-month period, whichever is higher. Furthermore, PSC Limited is engaged in unrelated payment services, and thus is subject to an additional ongoing capital requirement with respect to this part of its business. PSC Limited calculates the additional capital requirement for unrelated payment services by applying the fixed overheads method (Method A): that is, 10% of fixed overheads for the preceding period. The total regulatory capital requirement for PSC Limited and the actual total of qualifying capital resources held by PSC Limited at period end are as follows:

As at As at As at 30 June 30 June 31December 2015 2014 2014

Total regulatory capital requirement 975 1,145 1,071 Total of qualifying capital resources 6,320 2,055 1,873 As an AEMI, PSC Limited is required at all times to appropriately safeguard funds equal to the total of outstanding e-money issued by PSC Limited, in the form of qualifying assets of types

224 approved by the FCA as secure, low-risk and liquid. (Safeguarded funds held in the form of qualifying assets may exceed the total of outstanding e-money.) The balances are as per the table below. Safeguarded qualifying assets of PSC Limited are made up of cash and cash equivalents. PSC Limited was in compliance with safeguarding and own funds requirements for the periods ended 30 June 2015, 30 June 2014 and 31 December 2014. As at As at As at 30 June 30 June 31December 2015 2014 2014

Safeguarded qualifying assets 89,474 112,555 124,432 Outstanding e-money 33,079 43,135 41,020

Smart Voucher Limited Smart Voucher Limited is required by The Electronic Money Regulations 2011 (‘‘EMRs’’) and by the implementing rules specified by the Financial Conduct Authority (‘‘FCA’’) to maintain a specified minimum amount of own funds (capital). The FCA requires that, as an authorised electronic money institution (‘‘AEMI’’), Smart Voucher Limited must hold, at all times, capital equal to or in excess of either e350,000 or 2% of the average daily outstanding e-money amount at the end of each calendar day over the preceding 6-month period, whichever is higher. Furthermore, Smart Voucher Limited is engaged in unrelated payment services, and thus is subject to an additional ongoing capital requirement with respect to this part of its business. Smart Voucher Limited calculates the additional capital requirement for unrelated payment services by applying the fixed overheads method (Method A): that is, 10% of fixed overheads for the preceding period. The total regulatory capital requirement for Smart Voucher Limited and the actual total of qualifying capital resources held by Smart Voucher Limited at period end are as follows: As at As at As at 30 June 30 June 31December 2015 2014 2014

Total regulatory capital requirement 386 n.a n.a Total of qualifying capital resources 22,671 n.a n.a As an AEMI, Smart Voucher Limited is required at all times to appropriately safeguard funds equal to the total of outstanding e-money issued by Smart Voucher Limited, in the form of qualifying assets of types approved by the FCA as secure, low-risk and liquid. (Safeguarded funds held in the form of qualifying assets may exceed the total of outstanding e-money.) The balances are as per the table below. Safeguarded qualifying assets of Smart Voucher Limited are made up of cash and cash equivalents. Smart Voucher Limited was in compliance with safeguarding and own funds requirements for the period ended 31 December 2014. As at As at As at 30 June 30 June 31December 2015 2014 2014

Safeguarded qualifying assets 6,925 n.a n.a Outstanding e-money 2,301 n.a n.a 32. RELATED PARTY TRANSACTIONS Balances and transactions between the Company and its subsidiaries have been eliminated on consolidation and are not disclosed in this note. The disclosed amounts below relates to related parties which are not part of the consolidation and for this reason are not eliminated.

Period-end balances with related parties As at As at As at 30 June 30 June 31December Receivables from related parties 2015 2014 2014

Companies under common control (note 20) 871 879 929

871 879 929

225 The related party receivables are not overdue, neither impaired and are considered fully recoverable.

As at As at As at 30 June 30 June 31December Loans from related parties 2015 2014 2014

Loans – Companies under common control (note 22) 257,666 303,573 291,326 Preference shares and cumulative dividend – Companies under common control (note 22) 132,895 144,149 137,384

390,561 447,722 428,710

Remuneration of key management personnel The remuneration of key management personnel of the Group is set out below. Key management personnel is deﬁned as those persons having authority and responsibility for planning, directing and controlling the activities of the entity, directly or indirectly, being any member of the executive management team, including directors as discussed in note 9.

6 months to 6 months to 12 months 30 June 30 June to 31 Dec 2015 2014 2014

Short-term employee beneﬁts 989 1,210 2,864 Post-employment beneﬁts 60 49 113

33. ULTIMATE CONTROLLING PARTY As at 30 June 2015 and 31 December 2014, the ultimate holding company and controlling party is CVC Capital Partners SICAV-FIS S.A., a company registered in Luxembourg.

34. CONTINGENT LIABILITIES Skrill Group Limited, MB Acquisitions Limited, Skrill Holdings Limited, Skrill Limited, Sabemul Beteiligungsverwaltungs GmbH, paysafecard.com Wertkarten GmbH, paysafecard.com Vertriebs GmbH and MAC Limited were obligors of the loan between Sentinel Bidco Limited and three lending banks. The Group has been in full compliance with its banking covenants (note 22). The Group may be subject to legal claims and actions and takes legal advice as to the likelihood of success of any potential claims and actions. No provision or disclosure is made where the Directors feel, based on that advice, the action is unlikely to result in a material loss or a sufﬁciently reliable estimate of the potential obligation.

35. SUBSEQUENT EVENTS On 23 March 2015, Paysafe Group plc entered into an agreement to acquire 100% of the issued share capital of Sentinel Topco Limited and its subsidiaries. The transaction was completed on 10 August 2015 after clearance by the Financial Conduct Authority was received.

226 SECTION C: ACCOUNTANTS’ REPORT ON THE REPORTED ON FINANCIAL INFORMATION OF THE SKRILL OPERATING GROUP FOR THE SIX MONTH PERIOD ENDED 30 JUNE 2015 AND THE AUDITED FINANCIAL INFORMATION FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2014

The Directors Paysafe Group plc (‘‘Paysafe’’) Audax House 6 Finch Road Douglas Isle of Man

18 December 2015

Dear Sirs

Skrill Operating Group We report on the financial information set out on pages 229 to 274 for the year ended 31 December 2014 and the six months ended 30 June 2015. This financial information has been prepared for inclusion in the Prospectus dated 18 December 2015 of Paysafe Group plc on the basis of the accounting policies set out in note 2. This report is required by paragraph 20.1 of Annex 1 of the Prospectus Directive Regulation and is given for the purpose of complying with that paragraph and for no other purpose. We have not audited or reviewed the financial information for the 6 month period ended 30 June 2014 which has been included for comparative purposes only, and accordingly do not express an opinion thereon.

Opinion on financial information In our opinion, the financial information gives, for the purposes of the Prospectus dated 18 December 2015, a true and fair view of the state of affairs of Skrill Operating Group as at the year ended 31 December 2014 and the six months ended 30 June 2015 and of its profits/losses, cash flows and changes in equity for year/period then ended in accordance with the basis of

227 preparation set out in note 2 and in accordance with International Financial Reporting Standards as adopted by the European Union as described in note 2.

Yours faithfully

KPMG Audit LLC

228 SECTION D: REPORTED ON FINANCIAL INFORMATION OF THE SKRILL OPERATING GROUP FOR THE SIX MONTH PERIOD ENDED 30 JUNE 2015 AND AUDITED FINANCIAL INFORMATION FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2014

Consolidated income statement (all amounts in USD thousands unless otherwise stated)

6 months to 6 months to 12 months to 12 months to 30 June 30 June 31 December 31 December Note 2015 2014 2014 2013

Revenue 5 173,305 168,008 337,137 286,430 Cost of sales 6 (70,171) (67,798) (134,394) (116,041)

Gross proﬁt 103,134 100,210 202,743 170,389

Sales and marketing expenses (24,946) (24,362) (46,516) (38,451) Administrative expenses (54,444) (53,327) (98,956) (87,891)

Operating proﬁt 23,744 22,521 57,271 44,047

Finance income 11 23 7 41 105 Finance costs 12 (8,022) (9,006) (24,792) (12,087)

Proﬁt before income tax 15,745 13,522 32,520 32,065

Income tax expense 13 (1,017) (2,245) (767) (5,957)

Proﬁt for the period* 14,728 11,277 31,753 26,108

* Proﬁt for the period is fully attributable to owners of the parent.

229 Consolidated statement of comprehensive income (all amounts in USD thousands unless otherwise stated)

6 months to 6 months to 12 months to 12 months to 30 June 30 June 31 December 31 December Note 2015 2014 2014 2013

Proﬁt for the period 14,728 11,277 31,753 26,108

Other comprehensive income: Items that will not be reclassified to profit or loss Remeasurements of post- employment benefit obligations — — (21) —

Items that may be subsequently reclassified to profit or loss Change in value of available-for- sale financial assets (130) (8) (524) (509) Exchange differences on translation of foreign operations 1,123 (12) 674 (179) Cash flow hedge — 762 739 791

Other comprehensive income for the period 993 742 868 103

Total comprehensive income for the period * 15,721 12,019 32,621 26,211

* Total comprehensive income for the period is fully attributable to owners of the parent.

230 Consolidated balance sheet (all amounts in USD thousands unless otherwise stated)

30 June 30 June 31 December 31 December Note 2015 2014 2014 2013

Non-current assets Goodwill 14 234,773 208,000 208,000 208,000 Other intangible assets 15 111,463 111,046 113,047 114,671 Property, plant and equipment 16 8,627 8,103 8,459 8,229 Investments 18 329 974 459 983 Intercompany loans granted 13,369 — — — Deferred income tax asset 23 6,454 2,805 4,034 2,807

375,015 330,928 333,999 334,690 Current assets Inventories 19 1,043 730 1,080 1,564 Trade and other receivables 20 158,851 169,411 136,039 133,387 Cash and cash equivalents 27 661,272 628,322 677,011 647,031

821,166 798,463 814,130 781,982

Total assets 1,196,181 1,129,391 1,148,129 1,116,672

Equity and liabilities Non-current liabilities Borrowings 22 191,608 547 150,642 132,633 Provisions 171 224 — 34,385 Derivative ﬁnancial instruments 21 — — — 65 Deferred income tax liabilities 23 20,631 22,588 21,852 24,111

212,410 23,359 172,494 191,194 Current liabilities Trade and other payables 24 744,628 928,316 767,777 715,105 Current income tax liabilities 8,944 11,384 6,286 8,722 Provisions 3,309 — — 36,508 Borrowings 22 230 277 252 11,731 Derivative ﬁnancial instruments 21 — — — 701

757,111 939,977 774,315 772,767

Total liabilities 969,521 963,336 946,809 963,961

Equity attributable to owners of the parent Share capital 25 892 892 892 892 Share premium 2,199 2,199 2,199 2,199 Share reserve 757 1,064 1,064 1,064 Merger reserve 96,495 96,495 96,495 96,495 Other reserves (1,576) (914) (1,448) (903) Hedge reserve 49 72 49 (690) Translation Reserve (292) 3 339 (335) Retained earnings 104,785 69,581 90,057 58,304 Retained earnings – FX difference 23,351 (3,337) 11,673 (4,315)

Total equity 226,660 166,055 201,320 152,711

Total equity and liabilities 1,196,181 1,129,391 1,148,129 1,116,672

231 Consolidated statement of changes in equity (all amounts in USD thousands unless otherwise stated)

Share Share Share Merger Other Hedge Retained Total capital premium reserve reserve reserves reserve earnings FX diff equity

Balance as at 1 January 2014 892 2,199 1,064 96,495 (1,238) (690) 58,304 (4,315) 152,711

Proﬁt for the year — —————11,277 — 11,277 Other comprehensive income for the year — — — — (20) 762 — — 742

Total comprehensive income — — — — (20) 762 11,277 — 12,019 Retained earnings – FX difference — — — — 347 — — 978 1,325

Balance as at 30 June 2014 892 2,199 1,064 96,495 (911) 72 69,581 (3,337) 166,055

Balance as at 1 January 2015 892 2,199 1,064 96,495 (1,109) 49 90,057 11,673 201,320

Proﬁt for the year — —————14,728 — 14,728 Other comprehensive income for the year ————993 ———993

Total comprehensive income — — — — 993 — 14,728 — 15,721 Other — — (307) — — — — (307) Retained earnings – FX Difference — — — — (1,752) — — 11,678 9,926

Balance as at 30 June 2015 892 2,199 757 96,495 (1,868) 49 104,785 23,351 226,660

Share Share Share Merger Other Hedge Retained Total capital premium reserve reserve reserves reserve earnings FX diff equity

Balance as at 1 January 2013 892 — 1,064 96,495 (550) (1,481) 32,196 845 129,461

Proﬁt for the year — —————26,108 — 26,108 Other comprehensive income for the year — — — — (688) 791 — — 103

Total comprehensive income — — — — (688) 791 26,108 — 26,211

Issue of shares — 2,199 — — — — — — 2,199 Share options – value of employee services — —————501— 501

Total contributions by the owners of the parent, recognised directly in equity — 2,199 — — — — 501 — 2,700 Retained earnings – FX Difference — —————(501) (5,160) (5,661)

Balance as at 31 December 2013 892 2,199 1,064 96,495 (1,238) (690) 58,304 (4,315) 152,711

Proﬁt for the year — —————31,753 — 31,753 Other comprehensive income for the year — — — — 129 739 — — 868

Total comprehensive income — — — — 129 739 31,753 — 32,621 Retained earnings – FX Difference — ——————15,988 15,988

Balance as at 31 December 2014 * 892 2,199 1,064 96,495 (1,109) 49 90,057 11,673 201,320

* Total equity is fully attributable to owners of the parent.

232 Consolidated statement of cash ﬂows (all amounts in USD thousands unless otherwise stated)

30 June 30 June 31 December 31 December Note 2015 2014 2014 2013

Net cash generated from operating activities * 27 8,906 224,376 193,635 66,184 Acquisition of subsidiary, net of cash ** 10,553 (77,861) (75,486) 26,832 Purchases of property, plant and equipment (1,217) (1,656) (3,562) (3,701) Purchase of intangible assets (9,065) (6,796) (16,083) (14,498) Purchase of investments — — — (133)

Net cash generated from/(used in) investing activities 271 (86,313) (95,131) 8,500

Proceeds from borrowings — — 173,510 55,807 Proceeds from investors 46,609 — — — Transaction costs on bank loan — (1,175) — (8,535) Repayments of borrowings (13,368) (149,978) (167,818) (15,389) Proceeds from issue of shares — — — 2,199 Payment of ﬁnance derivatives (18) (890) (863) (862)

Net cash generated from ﬁnancing activities 33,223 (152,043) 4,829 33,220

Net increase in cash and cash equivalents 42,400 (13,980) 103,333 107,904

Cash and cash equivalents at the beginning of the period 677,011 647,031 647,031 514,508 Net foreign exchange difference (58,139) (4,729) (73,353) 24,619

Cash and cash equivalents at the end of the period 27 661,272 628,322 677,011 647,031

* Net cash generated from operating activities includes an amount of $514,000 (2013: $19,840,000), which relates to increase in the e-Money ﬂoat balance.

Reconciliation of total cash and cash equivalents to own cash is provided below:

30 June 30 June 31December 31December 2015 2014 2014 2013

Cash and cash equivalents at the end of the period 661,272 628,322 677,011 647,031

Less: e-money ﬂoat (note 24) (520,976) (533,960) (560,949) (514,312) Less: amounts owed to merchants / web shops (69,614) (62,415) (71,467) (67,328)

Own cash at the end of the period 70,682 31,947 44,595 65,391

233 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 1. GENERAL INFORMATION Skrill Group Limited (‘‘the Company’’) is a company incorporated and domiciled in Jersey, Channel Islands. The address of the registered ofﬁce is Queensway House, Hilgrove Street, St. Helier, Jersey, JE1 1ES, Channel Islands. The nature of the operations of Skrill Group Limited and its subsidiaries (together ‘‘the Group’’) are electronic money transfer services and online prepaid solutions. In addition the Group develops software for use in its principal activities.

2. SIGNIFICANT ACCOUNTING POLICIES The principal accounting policies applied in the preparation of these consolidated ﬁnancial statements are set out below. These policies have been consistently applied to all the years presented, unless otherwise stated.

Going concern The directors have adopted the going concern basis of accounting in preparing the consolidated financial information. Subsequent to the year end, on 10 August 2015, the transaction by Paysafe to acquire Sentinel Topco Limited, a parent entity of Skrill Group Limited, completed. As a result subsequent to this date the Group is a subsidiary of Paysafe Group plc. This transaction resulted in the repayment of the debt structure relating to Sentinel Holdings. The consideration by Paysafe was funded by a combination of debt and equity proceeds. The Paysafe Group plc Board have prepared detailed forecast financial information in respect of the combined group, reflecting its trading profile and financing payment obligations (both interest and capital), and associated covenant requirements. This forecast financial information has also been subject to reasonably foreseeable sensitivity scenarios. Under both the normal and stressed trading conditions considered the Group is forecast to continue to have sufficient resources available to service its debt obligations and continue trading. As such the directors of Paysafe Group plc have a reasonable expectation that the Group has adequate resources to continue in operational existence for the foreseeable future.

Business combinations Under the requirements of IFRS 3 (Revised), Business combinations, all business combinations that are not business combinations involving entities under common control, are accounted for using the purchase method. The cost of a business combination is the aggregate of the fair values at the date of exchange, of assets given, liabilities incurred or assumed and equity instruments issued by the Group in exchange for control of the acquire.

234 De-facto control may arise in circumstances where the size of the Group’s voting rights relative to the size and dispersion of holdings of other shareholders give the Group the power to govern the financial and operating policies, etc. Subsidiaries are fully consolidated from the date on which control is transferred to the Group. They are de-consolidated from the date that control ceases. On acquisition of a subsidiary, the assets, liabilities and contingent liabilities of a subsidiary are measured at their fair value at that date. Any excess of the cost of acquisition over the identifiable net assets acquired is recognised as goodwill. Any deficiency of the cost of acquisition below the fair values of the identifiable net assets acquired (i.e. discount on acquisition) is credited to the consolidated income statement in the financial year of acquisition. Acquisition-related costs are recognised in the income statement as incurred. Any contingent consideration to be transferred by the Group is recognised at fair value at the acquisition date. Subsequent changes to the fair value of the contingent consideration that is deemed to be an asset or liability is recognised in accordance with IAS 39 in profit or loss. The results of subsidiaries acquired during the year are included in the consolidated income statement from the effective date of acquisition. Control is achieved where the Company has the power to govern the financial and operating policies of an investee entity so as to obtain benefits from its activities. All intra-Group transactions, balances, income and expenses are eliminated on consolidation.

Goodwill Goodwill represents the excess of the cost of an acquisition over the fair value of the identifiable assets and liabilities of a subsidiary at the date of acquisition. Goodwill is initially recognised as an asset at cost and is subsequently measured at cost less any accumulated impairment losses. Goodwill is reviewed for impairment at least annually, or more frequently when there is an indication of impairment. Any impairment is recognised immediately in the income statement and is not subsequently reversed. For the purpose of impairment testing, goodwill is allocated to the Group’s cash-generating units which are expected to benefit from the synergies of the combination. If the recoverable amount of the cash-generating units is less than the carrying amount, the impairment loss is allocated first to reduce the carrying amount of goodwill and then to the other assets pro-rata on the basis of the carrying amount of each asset in the cash generating units.

(b) Transactions and balances Foreign currency transactions are translated into the functional currency using the exchange rates prevailing at the dates of the transactions or valuation where items are re-measured. Foreign exchange gains and losses resulting from the settlement of such transactions and from the translation at year-end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognised in the income statement. All foreign exchange gains and losses are presented in the income statement within ‘administrative expenses’.

235 (ii) income and expenses for each income statement are translated at average exchange rates (unless this average is not a reasonable approximation of the cumulative effect of the rates prevailing on the transaction dates, in which case income and expenses are translated at the rate on the dates of the transactions); and (iii) all resulting exchange differences are recognised in other comprehensive income. On consolidation, exchange differences arising from the translation of the net investment in foreign operations are taken to other comprehensive income.

Property, plant and equipment (PPE) Property, plant and equipment are stated at historical cost less accumulated depreciation. Historical cost includes expenditure that is directly attributable to the acquisition of the items and the costs attributable to bringing the asset to its working condition for its intended use. Subsequent costs are included in the asset’s carrying amount or recognised as a separate asset, as appropriate, only when it is probable that future economic benefits associated with the item will flow to the Group and the cost of the item can be measured reliably. The carrying amount of the replaced part is derecognised. All other repairs and maintenance are charged to the income statement during the financial period in which they are incurred. Depreciation is calculated using the straight-line method over their estimated useful lives, as follows:

Computer equipment 2 – 5 years Fixtures, fittings and equipment 3 – 7 years Other intangible assets (a) Trade name Acquired trade name assets are capitalised on the basis of the costs incurred to acquire them. They are amortised over their estimated useful life of four to five years; (b) Client relationships – merchants and end users Contractual customer relationships acquired in a business combination, including relationships with merchants and those with end users, are recognised at fair value at the acquisition date. The contractual customer relations have a finite useful life and are carried at cost less accumulated amortisation. Amortisation is calculated using the straight-line method over the expected life of the customer relationship, which is six to fourteen years; (c) Software and website development Costs associated with maintaining computer software programmes are recognised as an expense as incurred. Acquired computer software licences are capitalised on the basis of the costs incurred to acquire and bring to use the specific software. An internally-generated intangible asset arising from the development of the Group’s IT platform is recognised only if all of the following conditions are met: * an asset is created that can be identified; * it is probable that the asset created will generate future economic benefits; and * the development cost of the asset can be measured reliably. Internally-generated intangible assets are amortised on a straight-line basis over their useful lives. Where no internally-generated intangible asset can be recognised, development expenditure is recognised as an expense in the year in which it is incurred. Development costs directly attributable to the design and testing of identifiable and unique software products controlled by the Group are recognised as intangible assets when the following criteria are met: * it is technically feasible to complete the software product so that it will be available for use; * management intends to complete the software product and use or sell it; * there is an ability to use or sell the software product; * it can be demonstrated how the software product will generate probable future economic benefits;

236 * adequate technical, ﬁnancial and other resources to complete the development and to use or sell the software product are available; and * the expenditure attributable to the software product during its development can be reliably measured. Directly attributable costs capitalised as part of the software product include the software development employee costs. Other development expenditures that do not meet these criteria are recognised as an expense as incurred. Development costs previously recognised as an expense are not recognised as an asset in a subsequent period. Computer software development costs recognised as assets are amortised over their estimated useful lives, which do not exceed ﬁve years. Expenditure on research activities is recognised as an expense in the year in which it is incurred.

Financial assets Classification The Group classifies its financial assets in the following categories: at fair value through profit or loss, available for sale and loans and receivables. The classification depends on the purpose for which the financial assets were acquired. Management determines the classification of its financial assets at initial recognition. a) Financial assets at fair value through profit or loss A financial asset is classified in this category if acquired principally for the purpose of selling in the short term. Assets in this category are classified as current assets if expected to be settled within 12 months; otherwise, they are classified as non-current. b) Loans and receivables Loans and receivables are non-derivative financial assets with fixed or determinable payments that are not quoted in an active market. They are included in current assets, except for maturities greater than 12 months after the end of the reporting period. These are classified as non-current

237 assets. The Group’s loans and receivables comprise ‘trade and other receivables’ (note 20) and ‘cash and cash equivalents’ (note 27) on the balance sheet. c) Available for sale Available-for-sale ﬁnancial assets are non-derivatives that are either designated in this category or not classiﬁed in any of the other categories. They are included in non-current assets unless the investment matures or management intends to dispose of it within 12 months of the end of the reporting period.

Recognition and measurement Financial assets are recognised on the trade-date being the date on which the Group commits to purchase or sell the asset. Financial assets are initially recognised at fair value. Financial assets carried at fair value through profit or loss are initially recognised at fair value, and transaction costs are expensed in the income statement. Financial assets are derecognised when the rights to receive cash flows from the investments have expired or have been transferred and the Group has transferred substantially all risks and rewards of ownership. Loans and receivables are subsequently carried at amortised cost using the effective interest method. Other gains or losses arising from changes in the fair value of the ‘financial assets at fair value through profit or loss’ category are presented in the income statement within ‘administrative expenses’ in the year in which they arise.

Impairment of financial assets a) Assets carried at amortized cost The Group assesses at the end of each reporting period whether there is objective evidence that a financial asset or group of financial assets is impaired. A financial asset or a group of financial assets is impaired and impairment losses are incurred only if there is objective evidence of impairment as a result of one or more events that occurred after the initial recognition of the asset (a ‘loss event’) and that loss event (or events) has an impact on the estimated future cash flows of the financial asset or group of financial assets that can be reliably estimated. For loans and receivables category, the amount of the loss is measured as the difference between the asset’s carrying amount and the present value of estimated future cash flows discounted at the financial asset’s original effective interest rate. The carrying amount of the asset is reduced and the amount of the loss is recognised in the income statement.

Derivative financial instruments and hedging activities Derivatives are initially recognised at fair value on the date a derivative contract is entered into and are subsequently re-measured at their fair value. The method of recognising the resulting gain or loss depends on whether the derivative is designated as a hedging instrument, and if so, the nature of the item being hedged. The Group recognises a cash flow hedge in the balance sheet only as at 31 December 2013. During 2014 the cash flow hedge is terminated (note 21). The Group documents at the inception of the transaction the relationship between hedging instruments and hedged items, as well as its risk management objectives and strategy for undertaking various hedging transactions. The Group also documents its assessment, both at hedge inception and on an ongoing basis, of whether the derivatives that are used in hedging transactions are highly effective in offsetting changes in fair values or cash flows of hedged items. Movements on the hedging reserve in other comprehensive income are shown in the consolidated statement of changes in equity. The full fair value of a hedging derivative is classified as a non- current asset or liability when the remaining life of the hedged item is more than 12 months and as a current asset or liability when the remaining maturity of the hedged item is less than 12 months. The effective portion of changes in the fair value of derivatives that are designated and qualify as cash flow hedges is recognised in other comprehensive income. The gain or loss relating to the ineffective portion is recognised immediately in the income statement within ‘administrative expenses’ (no such gains and losses occurred during the presented periods). Amounts accumulated in equity are reclassified to profit or loss in the periods when the hedged item affects profit or loss. The gain or loss relating to the effective portion of interest rate swaps hedging variable rate borrowings is recognised in the income statement within ‘finance income/cost’.

238 However, when the forecast transaction that is hedged results in the recognition of a non-financial asset (for example, inventory or fixed assets), the gains and losses previously deferred in equity are transferred from equity and included in the initial measurement of the cost of the asset. The deferred amounts are ultimately recognised in cost of goods sold in the case of inventory or in depreciation in the case of fixed assets. When a hedging instrument expires or is sold, or when a hedge no longer meets the criteria for hedge accounting, any cumulative gain or loss existing in equity at that time remains in equity and is recognised when the forecast transaction is ultimately recognised in the income statement. When a forecast transaction is no longer expected to occur, the cumulative gain or loss that was reported in equity is immediately transferred to the income statement within ‘administrative expenses’.

Cash and cash equivalents Cash and cash equivalents include cash on hand and deposits held at call with banks. Included within cash are amounts relating to restricted cash balances as per agreements with speciﬁc providers. Skrill Limited and Prepaid Services Company Limited, FCA regulated entities, are required at all times to have qualifying liquid assets (comprising of cash and cash equivalents and investments) in excess of its e-money ﬂoat (see note 31).

E-Money float The e-money float represents amounts received into customer e-wallet accounts and unused prepaid card balances and are recorded within trade and other payables. These amounts are reflected in the consolidated balance sheet on the approval of the initiated transactions and unused card balances and are measured at fair value. The e-money float received forms part of the Group’s cash and cash equivalents and investment balances.

Recognition and measurement a) Trade payables Trade payables are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers or vendors. Accounts payable are classiﬁed as current liabilities if payment is due within one year or less. If not, they are presented as non-current liabilities. Trade payables are recognised initially at fair value and subsequently measured at amortised cost using the effective interest method. b) Borrowings Borrowings are recognised initially at fair value, net of transaction costs incurred. Borrowings are subsequently carried at amortised cost. Any difference between the proceeds (net of transaction costs) and the redemption value is recognised in the income statement over the period of the borrowings using the effective interest method. Finance charges are accounted for on an accruals basis and charged to the income statement using the effective interest rate method. Borrowings

239 are classiﬁed as current liabilities if payment is due within one year or less. If not, they are presented as non-current liabilities.

Financial liabilities and equity Debt and equity instruments are classiﬁed as either ﬁnancial liabilities or as equity in accordance with the substance of the contractual arrangement.

Derecognition of ﬁnancial liabilities The Group derecognises ﬁnancial liabilities when, and only when, the Group’s obligations are discharged, cancelled or they expire.

Current and deferred income tax The tax expense for the year comprises current and deferred tax. Tax is recognised in the income statement. The current income tax charge is calculated on the basis of the tax laws enacted or substantively enacted at the balance sheet date in the countries where the Company’s subsidiaries operate and generate taxable income. Management periodically evaluates positions taken in tax returns with respect to situations in which applicable tax regulation is subject to interpretation. It establishes provisions where appropriate on the basis of amounts expected to be paid to the tax authorities. Deferred income tax is recognised, using the liability method, on temporary differences arising between the tax bases of assets and liabilities and their carrying amounts in the consolidated financial information. However, the deferred income tax is not accounted for if it arises from initial recognition of an asset or liability in a transaction other than a business combination that at the time of the transaction affects neither accounting, nor taxable profit or loss. Deferred income tax is determined using tax rates (and laws) that have been enacted or substantially enacted by the balance sheet date and are expected to apply when the related deferred income tax asset is realised or the deferred income tax liability is settled. Deferred income tax assets are recognised only to the extent that it is probable that future taxable profit will be available against which the temporary differences can be utilised. Deferred income tax assets and liabilities are offset when there is a legally enforceable right to offset current tax assets against current tax liabilities and when the deferred income tax assets and liabilities relate to income taxes levied by the same taxation authority on either the taxable entity or different taxable entities where there is an intention to settle the balances on a net basis.

Equity-settled share-based payments The Group operates equity-settled share-based compensation plans under which the entity receives services from employees as consideration for equity instruments (options) of the Group. The fair value of the employee services received in exchange for the grant of the options is recognised as an expense. The total amount to be expensed is determined by reference to the fair value of the options granted. Non-market vesting conditions are included in assumptions about the number of options that are expected to vest. The total expense is recognised over the vesting period, which is the financial year over which all of the specified vesting conditions are to be satisfied. At the end of each reporting period, the entity revises its estimates of the number of options that are expected to vest

240 based on the non-market vesting conditions. It recognises the impact of the revision to original estimates, if any, in the income statement, with a corresponding adjustment to equity. When the options are exercised, the Company issues new shares. The proceeds received net of any directly attributable transaction costs are credited to share capital and share premium when the options are exercised. Where options are granted as consideration as part of a business combination, these options are included at fair value as part of the total consideration of the business combination in accordance with IFRS 3 (Revised).

Leasing Leases in which a significant portion of the risks and rewards of ownership are retained by the lessor are classified as operating leases. Payments made under operating leases (net of any incentives received from the lessor) are charged to the income statement on a straight-line basis over the period of the lease. The Group leases certain property, plant and equipment. Leases of PPE where the Group has substantially transferred all the risks and rewards of ownership are classified as finance leases. Finance leases are capitalised at the lease’s commencement at the lower of the fair value of the leased property and the present value of the minimum lease payments. Each lease payment is allocated between the liability and finance charges. The corresponding rental obligations, net of finance charges, are included in other long-term payables. The interest element of the finance cost is charged to the income statement over the lease period so as to produce a constant periodic rate of interest on the remaining balance of the liability for each period. The property, plant and equipment acquired under finance leases are depreciated over the shorter of the useful life of the asset and the lease term.

241 financial performance of the Group. Exceptional items are those items which are of a non-recurring nature, and in the judgement of the directors, need to be disclosed separately by virtue of their nature, size or incidence. Costs that are recurring include: * the restructuring of the activities of entities within the Group and reversal of any provision for the cost of restructuring; * disposal, revaluations or impairment of non-current assets (including property, plant and equipment); * disposal of assets associated with discontinued operations; * other. Income and expenses are not offset and are presented gross, unless required or permitted by an IFRS. The Group presents reconciliation between EBITDA and adjusted EBITDA in the notes to the financial statements. Additional breakdowns of the exceptional items are presented together with explanatory notes for the nature and cause of specific items.

3. EFFECT OF THE NEW STANDARDS, AMENDMENTS AND INTERPRETATIONS ADOPTED BY THE GROUP a) New standards, amendments and interpretations effective from 1 January 2014 and adopted by the Group The following standards have been adopted for the first time in the financial year and have a material impact on the Group: Amendments to IAS 36, ‘Impairment of assets,’ on the recoverable amount disclosures for non- financial assets. This amendment removed certain disclosures of the recoverable amount of CGUs which had been included in IAS 36 by the issue of IFRS 13. IFRS 10 ‘Consolidated financial statements’ is based on existing principles by identifying the concept of control as the determining factor in whether an entity should be included in the consolidated financial statements of the parent company. The standard provides additional guidance on the determination of control where this is difficult to assess. IFRS 12 ‘‘Disclosure of interests in other entities’’ includes the disclosure requirements for all forms of interests in other entities, including joint activities, associates, structured entities and other off-balance sheet investments. Other standards, amendments and interpretations which are effective for the financial period beginning on 1 January 2014 are not material to the Group.

(b) New standards, amendments and interpretations not yet adopted A number of new standards and amendments to standards and interpretations are effective for annual periods beginning after 1 January 2014, and have not been applied in preparing these consolidated financial statements. None of these is expected to have a significant effect on the consolidated financial statements of the Group, except the following set out below: IFRS 9, ‘Financial instruments,’ addresses the classification, measurement and recognition of financial assets and financial liabilities. The complete version of IFRS 9 was issued in July 2014. It replaces the guidance in IAS 39 that relates to the classification and measurement of financial instruments. IFRS 9 retains but simplifies the mixed measurement model and establishes three primary measurement categories for financial assets: amortised cost, fair value through other comprehensive income (OCI) and fair value through profit and loss. The basis of classification depends on the entity’s business model and the contractual cash flow characteristics of the financial asset. Investments in equity instruments are required to be measured at fair value through profit or loss with the irrevocable option at inception to present changes in fair value in OCI not recycling. There is now a new expected credit losses model that replaces the incurred loss impairment model used in IAS 39. For financial liabilities there were no changes to classification and measurement except for the recognition of changes in own credit risk in other comprehensive income, for liabilities designated at fair value through profit or loss. IFRS 9 relaxes the requirements for hedge effectiveness by replacing the bright line hedge effectiveness tests. It requires an economic relationship between the hedged item and hedging instrument and for the

242 ‘hedged ratio’ to be the same as the one management actually use for risk management purposes. Contemporaneous documentation is still required but is different to that currently prepared under IAS 39. The standard is effective for accounting periods beginning on or after 1 January 2018. Early adoption is permitted. The Group is yet to assess IFRS 9’s full impact. IFRS 15, ‘Revenue from contracts with customers’ deals with revenue recognition and establishes principles for reporting useful information to users of financial statements about the nature, amount, timing and uncertainty of revenue and cash flows arising from an entity’s contracts with customers. Revenue is recognised when a customer obtains control of a good or service and thus has the ability to direct the use and obtain the benefits from the good or service. The standard replaces IAS 18 ‘Revenue’ and IAS 11 ‘Construction contracts’ and related interpretations. The standard is effective for annual periods beginning on or after 1 January 2017 and earlier application is permitted. The Group is assessing the impact of IFRS 15. There are no other IFRSs or IFRIC interpretations that are not yet effective that would be expected to have a material impact on the Group.

4. CRITICAL ACCOUNTING JUDGEMENTS AND ESTIMATES The preparation of the consolidated financial information in conformity with IFRS – EU requires the management of the Company to make judgements, estimates and assumptions that may affect the use of accounting and valuation methods and the amounts of assets and liabilities, revenues and expenses recognised. Such estimates and the resulting assumptions are based on historical experience and various other factors that are believed to be reasonable under the given circumstances, and they form the basis for measuring the carrying amounts of assets and liabilities that are not readily available from other sources. The actual results may differ from these estimates. The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to estimates are recognised in the period in which the estimate is revised if the revision affects only that period or in the period of the revision and future periods if the revision affects both current and future periods. The most important assessments made by management of the Company with respect to the application of IFRS – EU that may have a significant effect on the consolidated financial information, and estimates entailing a risk that the assets and liabilities reported may have to be significantly adjusted within the next financial year are described below:

243 entity to estimate the future cash flows expected to arise from the cash-generating unit and a suitable discount rate in order to calculate present value. The Group assesses the carrying value of identifiable intangible assets, long-lived assets and goodwill annually, or more frequently if events or changes in circumstances indicate that such carrying value may not be recoverable. Factors considered important, which could trigger an impairment review, include the following: * significant under-performance relative to historical or projected future results; * significant changes in the manner of use of the acquired assets or the strategy for the overall business; and * significantly negative industry or economic trends. This assessment is based upon projections of anticipated discounted future cash flows. The most significant variables in determining cash flows are discount rates, terminal values, the number of years on which to base the cash flow projections, as well as the assumptions and estimates used to determine the cash inflows and outflows. The Group determines discount rates to be based on the risk inherent in the related activity’s current business model and industry comparisons. Terminal values are based on the expected life of products and forecasted life cycle and forecasted cash flows over that period. While the Group believes that its assumptions are appropriate, such amounts estimated could differ materially from what will actually occur in the future. In assessing goodwill, these non-discounted cash flows are prepared at a cash-generating unit level.

(d) Income taxes The Group is subject to the income tax laws of the various tax jurisdictions. These laws are complex and subject to different interpretations by taxpayers and tax authorities. Significant judgement is required in determining provisions for income taxes and deferred taxation. There are many transactions and calculations for which the ultimate tax determination is uncertain during the ordinary course of business. The Group recognises the liabilities for anticipated tax audit issues based on estimates of whether additional taxes will be due. Any reduction in the corporation tax liability as a result of business activities undertaken in a tax efficient manner, is fully provided for and released in accordance with the techniques identified by IAS 12, Income taxes. Where significant progress has been made towards agreement with the relevant tax authority, the measurement basis agreed with the tax authorities is utilised. In recognising deferred tax assets, the deferred tax is calculated on temporary differences between the carrying amounts and the tax values of assets and liabilities. There is one primary area where assumptions and assessments affect recognised deferred tax. This relates to the assumptions and assessments used to determine the carrying amounts of the different assets and liabilities. Although the deferred tax assets which have been recognised are considered realisable, actual amounts could be reduced if future taxable income is lower than expected. This can affect the Group’s reported profit and financial position. Deferred tax assets have been recognised where management believes there are sufficient taxable temporary differences or convincing other evidence that sufficient taxable profit will be available in future to realise deferred tax assets.

5. BUSINESS AND GEOGRAPHICALSEGMENTS Background The Group’s operations are based on two different business platforms – Skrill and paysafecard. Their performance is regularly reviewed by the Chief Operating Decision Maker (‘‘CODM’’). Within the Group, this function has been identiﬁed as being held by the Group’s Chief Executive Ofﬁcer, who is responsible for and manages the day-to-day management function of the Group in accordance with the Board’s guidelines. In the monthly performance in each of the markets the Group serves is dependent on resource allocation to these platforms, as well as client service and marketing.

244 Revenues from major products and services The Group’s revenues from its major products and services, all of which are continuing operations, were as follows:

30 June 30 June 31December 31December 2015 2014 2014 2013

Merchant revenue 128,639 124,635 250,253 212,087 End user revenue 25,617 23,826 47,660 36,368 Financial revenue 19,049 19,547 39,224 37,975

173,305 168,008 337,137 286,430

Financial revenue includes FX spread income and interest income from e-money ﬂoat.

Geographical information The Group’s revenues from external customers by geographical location are detailed below:

30 June 30 June 31December 31December 2015 2014 2014 2013

UK 10,930 7,500 15,101 13,113 Europe 126,849 120,434 240,626 197,681 Americas 5,636 4,082 9,581 10,165 Rest of the World 9,193 6,451 13,673 10,848 FX spread income 15,599 15,581 31,406 29,624 Other, including interest from e- money ﬂoat, maintenance fees and voucher fees 8,355 18,781 36,174 32,569 Rebates (3,257) (4,821) (9,424) (7,570)

173,305 168,008 337,137 286,430

Information about major customers The Group did not have any single customer or distributor contributing more than 10 percent of total revenues during any of the two years ended 31 December 2014 and 31 December 2013 or periods ended 30 June 2015.

6. OPERATING PROFIT Operating proﬁt has been arrived at after charging:

30 June 30 June 31December 31December 2015 2014 2014 2013

Depreciation of property, plant and equipment (note 16) 1,601 1,715 3,391 2,940 Rentals (operating leases) (note 29) 1,020 1,100 2,942 2,586 Amortisation of intangible assets (note 15) 10,127 10,046 21,098 16,582 Foreign exchange losses (866) 681 892 1,171 Staff costs (note 9) 30,917 28,237 55,174 49,142 Non-recurring costs (note 7) 7,740 7,577 9,731 13,181

245 Cost of sales can be broken down as follows:

30 June 30 June 31December 31December 2015 2014 2014 2013

Purchased services and cost of materials 46,128 45,881 26,706 23,757 Transaction processing fees 13,514 13,768 9,134 4,089 Bad debt expenses 6,595 2,825 7,507 5,972 Referral bonus 3,011 3,689 1,733 8,814 Promotions 923 1,635 89,314 73,409

70,171 67,798 134,394 116,041

7. EBITDA RECONCILIATION EBITDA and Adjusted EBITDA are calculated as follows:

30 June 30 June 31December 31December 2015 2014 2014 2013

Operating proﬁt for the year 23,744 22,521 57,271 44,047 Add back: Depreciation (note 16) 1,601 1,715 3,391 2,940 Amortisation (note 15) 10,127 10,046 21,098 16,582

EBITDA 35,472 34,282 81,760 63,569

Non-recurring costs 7,740 7,577 9,731 13,181

Adjusted EBITDA 43,212 41,859 91,491 76,750

Non- Non- Cash cash Total Cash cash Total

Share option charge (note 9) — — — ——— Integration related costs 5,176 — 5,176 1,197 — 1,197 Acquisition and sale related costs 331 — 331 6,101 — 6,101 Other 129 2,104 2,233 279 — 279

Charge to operating proﬁt 5,636 2,104 7,740 7,577 — 7,577

31 December 2014 31 December 2013

Non- Non- Cash cash Total Cash cash Total

Share option charge (note 9) — — — — 502 502 Integration related costs 2,756 — 2,756 4,716 — 4,716 Acquisition and sale related costs 6,299 — 6,299 7,167 — 7,167 Other 486 190 676 796 — 796

Charge to operating proﬁt 9,541 190 9,731 12,679 502 13,181

246 Integration related costs include certain one off costs incurred as Skrill integrates the e-wallet and prepaid voucher businesses, and aligns around a clear set of shared goals. Also included are severance costs relating to restructure of senior management and support functions following these acquisitions. Acquisition and sale related costs include costs associated with the acquisition of the e-wallet and prepaid voucher business, as well as other M&A related activities. Other costs include costs associated with onerous lease contracts and bonuses as part of restructuring.

8. AUDITORS’ REMUNERATION The analysis of auditors’ remuneration is as follows:

30 June 30 June 31December 31December 2015 2014 2014 2013

Fees payable to the auditors for the audit of Skrill Group Limited’s annual ﬁnancial statements — — — 90 Fees payable to the auditors and their associates for Skrill Group Limited’s subsidiaries 181 127 255 441

Total audit fees 181 127 255 531

Tax services — 19 19 77 Transaction services — 84 140 1,389 Other 1 27 47 46

Total non-audit fees 1 130 206 1,512

The fees payable to the auditors for the audit of Skrill Group Limited and part of its subsidiaries’ annual ﬁnancial statements are payable by Sentinel Bidco Limited, the immediate parent of Skrill Group Limited.

9. Employee information The average monthly number of employees (including executive directors) was:

30 June 30 June 31December 31December 2015 2014 2014 2013 Number Number Number Number

Management 10 9 8 14 Finance 84 88 83 86 Sales and marketing 178 167 165 199 Customer services 168 144 140 131 Administration 21 24 22 34 Information technology 200 197 190 165 Compliance and risk 82 88 81 87 Human resources 18 23 20 19

761 740 709 735

247 Their aggregate remuneration comprised:

30 June 30 June 31December 31December 2015 2014 2014 2013

Wages and salaries 28,885 25,545 52,050 44,003 Social security costs 4,489 4,928 8,676 8,605 Share option charge – value of employee services (note 7) — — — 502 Less: capitalised costs (2,457) (2,236) (5,552) (3,968)

30,917 28,237 55,174 49,142

Presentation of Directors’ remuneration disclosures At the end of all reported periods the Company had three Directors.

Summary of Directors’ remuneration

USD USD USD USD 30 June 30 June 31December 31December 2015 2014 2014 2013

Directors’ emoluments consist of: Remuneration and other short-term employee beneﬁts — 456,461 279,922 621,782 Directors’ fees — — — 6,426

— 456,461 279,922 628,208

Emoluments of highest paid Director — 179,691 174,209 621,782

Directors’ interests The highest paid Director’s beneﬁcial interest in the Ordinary shares is as follows:

30 June 30 June 31December 31December 2015 2014 2014 2013 Number Number Number Number

A Ordinary shares — — — 3,017 B I Ordinary shares — — — 7,810

10. DIVIDENDS There were no dividends declared by the Group in the periods reported.

11. FINANCE INCOME

30 June 30 June 31December 31December 2015 2014 2014 2013

Finance income on bank deposits 23 7 41 105

23 7 41 105

248 12. FINANCE COSTS

30 June 30 June 31December 31December 2015 2014 2014 2013

Interest on bank borrowings 31 1,823 1,773 8,411 Interest on related party borrowings 7,991 — 16,055 — Amortisation of loan arrangement fee and issue costs — 7,183 6,964 3,676

8,022 9,006 24,792 12,087

13. INCOME TAX EXPENSE

30 June 30 June 31December 31December 2015 2014 2014 2013

Current tax Current tax on proﬁts for the year 2,160 2,589 2,732 10,012 Adjustments in respect of prior periods — 1,570 1,522 (1,616)

2,160 4,159 4,254 8,396

Deferred tax Credit to the income statement (1,143) (1,914) (3,487) (2,439)

(1,143) (1,914) (3,487) (2,439)

Income tax expense 1,017 2,245 767 5,957

UK corporation tax is calculated at 21,5% (2013: 23.25%) of the estimated taxable profit for the year. Taxation for other jurisdictions is calculated at the rates prevailing in the respective jurisdictions. The tax on the Group’s profit before tax differs from the theoretical amount that would arise using the weighted average tax rate applicable to profits of the consolidated entities as follows:

30 June 30 June 31December 31December 2015 2014 2014 2013

Proﬁt before income tax 15,745 13,522 32,520 32,065

Tax calculated at UK corporation tax rate 3,228 2,908 6,992 7,455 Tax effect of expenses/income that are not deductible/taxable (406) (438) 2,772 1,463 Effect of different tax rates in foreign subsidiaries (585) (7,245) (413) (1,434) Other tax adjustments (1,220) 5,450 (10,106) 89 Adjustments in respect of prior periods — 1,570 1,522 (1,616)

Income tax expense 1,017 2,245 767 5,957

249 14. GOODWILL

30 June 30 June 31December 31December 2015 2014 2014 2013

At 1 January 208,000 208,000 208,000 106,913 Additions 26,773 — — 101,087

At 31 December 234,773 208,000 208,000 208,000

Goodwill acquired is allocated to both Group’s cash generating units (CGUs) – Legacy Skrill and Legacy psc (paysafecard.com Wertkarten GmbH (‘‘paysafecard’’) is a company incorporated in Austria, the holding company of a group of companies, that is a market leader in online prepaid solutions. paysafecard’s prepaid products allow end users to digitalise cash and to transact online. paysafecard’s products can be purchased at over 515,000 sales outlets in 39 countries across Europe, North America and South America.). The Group tests goodwill annually for impairment or more frequently if there are indications that goodwill might be impaired. No impairment of goodwill was required during the presented periods. During the fourth quarter of 2014 an impairment test was carried which resulted in no impairment of goodwill. No indicators of impairment have been identified in the period to 30 June 2015. For the cash generating units the Group prepares cash flow forecasts derived from the most recent financial budget approved by management. The cash flows are prepared for the next three years. These cash flows are then extrapolated for periods beyond the budget period at an estimated growth rate of 2.9%. The pre-tax discount rate used to discount the cash flows is 10.1%. Changes in selling prices and direct costs are based on historical information and expectations of future changes in the market. No adverse changes in these conditions are expected.

15. OTHER INTANGIBLE ASSETS

Software and Client Client Trade name website relationships relationships and domain development – merchants – end users name Total

Cost At 1 January 2014 41,174 115,136 5,602 6,214 168,126 Additions 6,407 — — 14 6,421

At 30 June 2014 47,581 115,136 5,602 6,228 174,547

Accumulated amortisation At 1 January 2014 18,020 26,474 5,568 3,393 53,455 Charge for the period (note 7) 4,318 5,213 — 515 10,046

At 30 June 2014 22,338 31,687 5,568 3,908 63,501

Net book amount At 30 June 2014 25,243 83,449 34 2,320 111,046

Cost At 1 January 2015 60,637 115,136 5,602 6,225 187,600 Acquired as part of business combinations 5,309 — — — 5,309 Additions 7,737 — — 9 7,746

At 30 June 2015 73,683 115,136 5,602 6,234 200,655

At 1 January 2015 27,388 37,229 5,568 4,368 74,553 Acquired as part of business combinations 4,512 — — — 4,512 Charge for the year (note 7) 5,077 4,669 — 381 10,127

At 30 June 2015 36,977 41,898 5,568 4,749 89,192

Net book amount At 30 June 2015 36,706 73,238 34 1,485 111,463

250 Software and Client Client Trade name website relationships relationships and domain development – merchants – end users name Total

Cost At 1 January 2013 22,924 29,613 5,602 2,709 60,848 Acquired as part of business combinations 4,648 85,523 — 3,453 93,624 Additions 13,696 — — 52 13,748 Disposals (94) — — — (94)

At 31 December 2013 41,174 115,136 5,602 6,214 168,126 Additions 19,463 — — 11 19,474

At 31 December 2014 60,637 115,136 5,602 6,225 187,600

Accumulated amortisation At 1 January 2013 12,163 16,971 5,351 2,447 36,932 Charge for the year (note 7) 5,916 9,503 217 946 16,582 Disposals (59) — — — (59)

At 31 December 2013 18,020 26,474 5,568 3,393 53,455 Charge for the year (note 7) 9,368 10,755 — 975 21,098

At 31 December 2014 27,388 37,229 5,568 4,368 74,553

Net book amount At 31 December 2013 23,154 88,662 34 2,821 114,671

At 31 December 2014 33,249 77,907 34 1,857 113,047

During the year ended 31 December 2014, internally generated intangible assets included within additions to the cost of software and website development were $9,046,000 (31 December 2013: $3,968,000). As at the year ended 31 December 2014, internally generated intangible assets included within cost of software and website development is $23,504,000 (31 December 2013: $14,312,000). As at the year ended 31 December 2014, internally generated intangible assets included within carrying amount of software and website development is $11,860,000 (31 December 2013: $6,482,000). During the period ended 30 June 2015, internally generated intangible assets included within additions to the cost of software and website development were $4,356,000 (30 June 2014: $3,716,000). As at the period ended 30 June 2015, internally generated intangible assets included within cost of software and website development is $23,998,000 (30 June 2014: $18,488,000). As at the period ended 30 June 2015, internally generated intangible assets included within carrying amount of software and website development is $13,137,000 (30 June 2014: $10,873,000). Software and website development includes the following amounts where the Group is a lessee under a ﬁnance lease:

30 June 30 June 31December 31December 2015 2014 2014 2013

Cost 751 751 751 751 Accumulated amortisation (360) (191) (282) (95)

Net book amount 391 560 469 656

The duration of the lease contract is until February 2017 and ownership of the assets lies within the Group.

251 16. PROPERTY, PLANT AND EQUIPMENT

Fixtures, Computer ﬁttings and equipment equipment Total

Cost At 1 January 2014 12,716 4,027 16,743 Additions 1,382 485 1,867 Disposals (5) (277) (282)

At 30 June 2014 14,093 4,235 18,328 Accumulated depreciation At 1 January 2014 7,036 1,478 8,514 Charge for the year (note 7) 1,400 315 1,715 Disposals (4) — (4)

At 30 June 2014 8,432 1,793 10,225

Net book amount At 30 June 2014 5,661 2,442 8,103

Cost At 1 January 2015 15,665 4,406 20,071 Additions 1,014 165 1,179 Acquired as part of business combinations 613 1,016 1,629 Disposals — (24) (24)

At 30 June 2015 17,292 5,563 22,855

Accumulated depreciation At 1 January in 2015 9,678 1,934 11,612 Charge for the year (note 7) 1,273 328 1,601 Acquired as part of business combination 465 570 1,035 Disposals — (20) (20)

At 30 June 2015 11,416 2,812 14,228

Net book amount At 30 June 2015 5,876 2,751 8,627

252 Fixtures, Computer ﬁttings and equipment equipment Total

Cost At 1 January 2013 8,057 1,751 9,808 Acquisition of subsidiary (note 28) 3,775 1,199 4,974 Additions 1,628 1,623 3,251 Disposals (744) (546) (1,290)

At 31 December 2013 12,716 4,027 16,743 Additions 3,057 590 3,647 Disposals (108) (211) (319)

At 31 December 2014 15,665 4,406 20,071

Accumulated depreciation At 1 January 2013 3,534 890 4,424 Acquisition of subsidiary (note 28) 1,829 497 2,326 Charge for the year (note 7) 2,413 527 2,940 Disposals (740) (436) (1,176)

At 31 December 2013 7,036 1,478 8,514 Charge for the year (note 7) 2,738 653 3,391 Disposals (96) (197) (293)

At 31 December 2014 9,678 1,934 11,612

Net book amount At 31 December 2013 5,680 2,549 8,229

At 31 December 2014 5,987 2,472 8,459

Computer equipment includes the following amounts where the Group is a lessee under a ﬁnance lease:

30 June 30 June 31December 31December 2015 2014 2014 2013

Cost 344 344 344 344 Accumulated depreciation (165) (87) (129) (42)

Net book amount 179 257 215 302

The duration of the lease contract is until February 2017 and ownership of the assets lies within the Group.

17. SUBSIDIARIES All subsidiary undertakings are included in the consolidation. The proportion of the voting rights in the subsidiary undertakings held directly by the parent company does not differ from the proportion of the ordinary shares. The entities directly held by the Company are MB Acquisitions Limited, Skrill Capital Limited, Skrill Capital UK Limited, Digital Payments Europe Limited, Digital Payment Solutions New Zealand Limited and Digital Payment Solutions Australia Pty Ltd.

253 The Group’s investments in the ordinary share capital of subsidiary companies at the balance sheet date include the following: Proportion Place of of interest in Proportion incorporation ordinary of voting Name (or registration) Operations shares power held

Skrill Capital Limited Jersey Non-trading company 100% 100% Digital Payments Europe Limited England and Non-trading company 100% 100% Wales Digital Payment Solutions New New Zealand Non-trading company 100% 100% Zealand Limited Digital Payment Solutions Australia Australia Non-trading company 100% 100% Pty Limited MB Acquisitions Limited England and Holding and consultancy services 100% 100% Wales company Skrill Holdings Limited England and Holding and consultancy services 100% 100% Wales company MB Employee Nominees Limited England and Non-trading company 100% 100% Wales Skrill Limited England and Electronic money transfer 100% 100% Wales services Skrill Bulgaria EOOD Bulgaria Consultancy, development and 100% 100% implementation of software Skrill USA, Inc. United States of Online Payment service provider 100% 100% America and electronic money transfer services Skrill International Payments Limited England and Consulting services to group 100% 100% Wales companies Skrill Capital UK Limited England and Non-trading company 100% 100% Wales Payolution GmbH Austria Payment facilitator enabling online 100% 100% merchants to offer their customers payments solutions Payolution Schweiz GmbH Switzerland Payment facilitator enabling online 100% 100% merchants to offer their customers payments solutions Skrill Services GmbH Germany Consulting services to group 100% 100% companies Skrill Canada Inc. Canada Non-trading company 100% 100% Skrill Hong Kong Limited Hong Kong Non-trading company 100% 100% Skrill Singapore Limited Singapore Non-trading company 100% 100% Sabemul Beteiligungsverwaltungs Austria Holding company 100% 100% GmbH paysafecard.com Wertkarten GmbH (formerly AG#) Austria Holding, development and 100% 100% consultancy services company paysafecard.com Wertkarten Austria Distribution and merchant 100% 100% Vertriebs GmbH services cpt Dienstleistungen GmbH Germany Distribution services 100% 100% Prepaid Services Company Limited England and Issuing of electronic money, 100% 100% Wales distribution and merchant services paysafecard.com Schweiz GmbH Switzerland Issuing and distribution services 100% 100% MAC Limited Gibraltar Merchant services 100% 100% paysafecard.com Argentina S.R.L. Argentina Issuing, distribution and merchant 100% 100% services paysafecard.com Me´xico SA de CV Mexico Issuing, distribution and merchant 100% 100% services paysafecard.com USA Inc. United States of Distribution and merchant 100% 100% America services paysafecard O¨ nO¨ deme Servisleri Turkey Issuing, distribution and merchant 100% 100% Limited Sirketi services paysafecard.com d.o.o. (in liquidation) Croatia — 100% 100% Smart Voucher Limited England and Electronic money transfer 100% 100% Wales services Pebblestone Holding Limited Gibraltar Consulting & ﬁnancial services 100% 100% Quick Cash Limited England and Non trading company 100% 100% Wales Smart E-money Limited England and Non trading company 100% 100% Wales

254 Proportion Place of of interest in Proportion incorporation ordinary of voting Name (or registration) Operations shares power held

Ukash Limited England and Non trading company 100% 100% Wales Universal E-Cash Limited England and Non trading company 100% 100% Wales 18. Investments

30 Jun 30 Jun 31December 31December 2015 2014 2014 2013

Available for sale investments 145 869 327 1,358 Convertible bonds 112 137 133 134 Net foreign exchange difference 72 (32) (1) (509)

329 974 459 983

30 Jun 30 Jun 31December 31December 2015 2014 2014 2013

Balance as at 1 January 459 983 983 1,358 Change in the value of available for sale ﬁnancial asset (130) (9) (524) (509)

Balance as at 329 974 459 983

On 21 December 2012, Skrill Holdings Limited, invested $1,302,000 (excluding related costs) in Cybits Holding AG. As part of the agreement Skrill had an option to purchase convertible bonds issued by Cybits AG (fully owned subsidiary of Cybits Holding). The period when the option could be exercised was between 1 January 2013 and July 2013. As a result convertible bonds amounting to $133,000 were purchased during 2013.

19. INVENTORIES

30 June 30 June 31December 31December 2015 2014 2014 2013

Cards 144 210 187 194 Vouchers 838 394 805 1363 Security tokens 61 126 88 7

1,043 730 1,080 1,564

Cost of inventories amounting to $0 (zero) was impaired and recognised as an expense (30 June 2014: $0 (zero)).

255 20. TRADE AND OTHER RECEIVABLES

30 June 30 June 31December 31December 2015 2014 2014 2013

Trade receivables 88,111 116,947 119,574 118,664 Other debtors 9,793 16,653 9,741 8,067 Prepayments and accrued income 7,583 6,733 5,651 6,656 Related party receivables (note 32) 53,364 29,078 1,073 —

158,851 169,411 136,039 133,387

The trade receivables above primarily relate to amounts due from payment service providers and distribution partners. There are no trade receivables considered to be impaired. As at 30 June 2015 provisions amounting to $1,473,000 (31 December 2014: $1,614,000, 30 June 2014: $1,877,000 and 31 December 2013: $1,894,000) are included in receivables to cover the payment default risk of distribution partners, to the extent it is not covered by insurance. The directors consider that the carrying amount of trade receivables is approximately equal to their fair value.

21. DERIVATIVE FINANCIAL INSTRUMENTS

30 June 30 June 31December 31December 2015 2014 2014 2013

Interest rate swaps – cash ﬂow hedge — — — 766

— — — 766

Current — — — 701 Non-current — — — 65

— — — 766

In 2013 the variable interest rate is based on 3 month EURIBOR and varies from 0.2930 to 0.1320. On 12 February 2014 the cash ﬂow hedge was terminated as a result of the repayment of the bank loan. The full fair value of a hedging derivative is classiﬁed as a non-current liability if the remaining maturity of the hedged item is more than 12 months and, as a current liability, if the maturity of the hedged item is less than 12 months.

256 22. BORROWINGS

30 June 30 June 31December 31December 2015 2014 2014 2013

Bank borrowings 53 65 58 143,458 Related party borrowings (note 32) 172,420 — 138,185 — Interest on related party borrowings (note 32) 18,977 — 12,098 — Finance lease liabilities 388 759 553 906

191,838 824 150,894 144,364 Current Bank borrowings — — — 11,452 Finance lease liabilities 230 277 252 279

230 277 252 11,731

Non-current Bank borrowings 53 65 58 132,006 Related party borrowings 172,420 — 138,185 — Interest on related party borrowings 18,977 — 12,098 — Finance lease liabilities 158 482 301 627

191,608 547 150,642 132,633

Bank borrowings In the year ended 31 December 2013 the Group had a Senior Facilities Agreement with Lloyds TSB Plc, NIBC Financing N.V and The Royal Bank of Scotland Plc, entered into on 1 December 2011 and amended and restated on 22 June 2012. The Senior Facilities Agreement was for a total principal amount of $103,592,000 segregated into Facility A1 of $31,078,000 and Facility B1 of $72,514,000 which is repayable over 5 years and 6 years term respectively. As part of the amendment and restatement a further $55,064,000 were drawn down on 6 February 2013 which are repayable over the same term. The new facilities are respectively: A2 – amounting to $20,649,000 and B2 – amounting to $34,415,000. The loan has been shown net of amortised issue costs of $7,213,000 as at 31 December 2013. On 12 February 2014 the Group fully repaid the existing loan under the Senior Facilities Agreement. There is another loan in place between Payolution GmbH and Austrian Research Promotion Agency. The amount of the loan as at 31 June 2015 is $53,000 (as at 30 June 2014: $65,000, as at 31 December 2014: $58,000, as at 31 December 2013: $66,000). The annual interest rate is 2% and is paid annually. The total amount of the principal is due on 31 March 2018. In 2013, the borrowing of paysafecard.com Wertkarten GmbH related to the ﬁnancing of the acquisition of the shares in WH International Payment Services B.V.; the respective loan agreement was in place with ‘‘BAWAG P.S.K. Bank fu¨r Arbeit und Wirtschaft und O¨ sterreichische Postsparkasse Aktiengesellschaft’’. The agreed interest rate is 3-month EURIBOR plus spread. The carrying amount of the loan as at 31 December 2013 is $2,141,000 separated as current – $714,000 and non-current – $1,426,000. This loan was fully repaid in March 2014.

Related party borrowings Sabemul Beteiligungsverwaltungs GmbH, a subsidiary of Skrill Group Limited, has a term loan facility of $62,597,000 from Sentinel Bidco Limited, the sole shareholder of the Company. The facility came into effect on 17 February 2014 and shall continue in force for a period of ﬁve years. The unpaid principal as at 30 June 2015 is $33,941,000 (as at 31 December 2014 $42,091,000). The facility is unsecured and is repayable in ﬁve equal instalments. Sabemul Beteiligungsverwaltungs GmbH, a subsidiary of Skrill Group Limited, has a second term loan facility of $50,767,000 from Sentinel Bidco Limited, the sole shareholder of the Company. The facility relates with the acquisition of ukash and is unsecured. The unpaid interest as at 30 June 2015 is $691,000.

257 MB Acquisitions Limited, subsidiary of Skrill Group, has a loan of $96,095,000 from Sentinel Bidco Limited, the sole shareholder of the Company. The loan came into effect on 12 February 2014 and shall continue in force for a period of ten years. The unpaid principal as at 30 June 2015 amounts to $87,712,000 (as at 31 December 2014: $96,095,000) and the accrued and unpaid interest amounts to $17,329,000 (as at 31 December 2014: $12,098,000). The loan is unsecured and is repayable on the date falling ten years after the date of the agreement.

Finance lease The ﬁnance lease is held by paysafecard.com Wertkarten GmbH from Raiffeisen-Leasing O¨ sterreich GmbH, Vienna for the duration of 48 months until February 2017. The interest rate is 3 month Euribor plus spread.

23. DEFERRED INCOME TAX ASSETS AND LIABILITIES The analysis of deferred tax assets and deferred tax liabilities is as follows:

30 June 30 June 31December 31December 2015 2014 2014 2013

Deferred tax assets * Recoverable after more than 12 months 3,886 2,158 2,874 2,161 * Recoverable within 12 months 2,568 647 1,160 646

6,454 2,805 4,034 2,807

Deferred tax liabilities * Recoverable after more than 12 months (16,621) (18,876) (17,761) (20,545) * Recoverable within 12 months (4,010) (3,712) (4,091) (3,566)

(20,631) (22,588) (21,852) (24,111)

Deferred tax liabilities (net) (14,177) (19,783) (17,818) (21,304)

Deferred tax assets are recognised for the tax losses carried forward to the extent that the realisation of the related tax benefit through future taxable profits is probable. As at 30 June 2015 the Group recognised a deferred tax asset amounting to $2,413,000 (as at 31 December 2014: $2,413,000, as at 30 June 2014: $1,054,000, as at 31 December 2013: $1,054,000) for the accumulated losses as they can be carried forward against future taxable income. Tax losses can be carried forward for an indefinite period of time.

24. TRADE AND OTHER PAYABLES

30 June 30 June 31December 31December 2015 2014 2014 2013

Trade payables 143,025 151,314 164,127 166,582 E-money ﬂoat 520,976 533,960 560,949 514,312 Other payables 14,070 8,541 9,087 15,188 Accruals 22,254 18,624 18,870 19,023 Related party payables (note 32) 44,303 215,877 14,744 —

744,628 928,316 767,777 715,105

258 The Skrill e-money ﬂoat represents monies that have been deposited by both end customers and merchants whereas the paysafecard e-money relates to unused balances held on the cards. In 2013, the e-money balance acquired with paysafecard amounted to $47,627,000 (note 28). The directors consider that the carrying amount of trade payables approximates to their fair value.

25. SHARE CAPITAL On 4 February 2014 the Company reorganised its share capital and converted each class of the existing shares into 696,452,380,000 ordinary shares of EUR 0.000001 each. At 30 June 2015, 30 June 2014 and 31 December 2014, the authorised shares were:

Authorised Nominal 30 June 2015 Number Class value EUR

696,452,380,000 Ordinary EUR 0.000001 696,452

696,452

At 30 June 2015, 30 June 2014, 31 December 2013 and 31 December 2014, the allotted, issued and fully paid share capital were:

Translated to Allotted, issued and fully paid Nominal 30 June 2015 30 June 2015 Number Class value EUR $

678,461,550,000 Ordinary EUR 0.000001 678,462 892,000

678,462 892,000

On 6 February 2013, the Company issued 2000 BII Ordinary Shares of e0.01 each for EUR 1,656,231, to employees. These shares were issued at a premium of EUR 828.12 per share. During 2013, 7,401 ‘C I’ shares were issued to employees and their holding vehicles. These shares were issued based on certain conditions being met. During 2013, 1,189 ‘C II’ shares were issued to employees and their holding vehicles as consideration for the Payolution acquisition. At 31 December 2013, the authorised shares were:

Authorised Nominal 31 December 2013 Number Class value EUR

15,500 A Ordinary EUR 0.01 155 329,732 B I Ordinary EUR 0.01 3,297 2,000 B II Ordinary EUR 0.01 20 55,279 C I Ordinary EUR 0.01 553 2,221 C II Ordinary EUR 0.01 22 37,723 A Specified Capital Ordinary EUR 10.00 377,230 23,579,506 B Specified Capital Ordinary EUR 0.01 235,795 7,938 Priority Specified Capital Ordinary EUR 10.00 79,380

696,452

259 At 31 December 2013, the allotted, issued and fully paid share capital was:

Translated to 31 December Allotted, issued and fully paid Nominal 30 June 2015 2013 Number Class value EUR $

15,500 A Ordinary EUR 0.01 155 204 328,350 B I Ordinary EUR 0.01 3,284 4,318 2,000 BII Ordinary EUR 0.01 20 26 47,664 C I Ordinary EUR 0.01 477 627 2,221 C II Ordinary EUR 0.01 22 29 A Specified Capital 35,929 Ordinary EUR 10.00 359,290 472,399 B Specified Capital 23,579,506 Ordinary EUR 0.01 235,795 310,027 Priority Specified 7,938 Capital Ordinary EUR 10.00 79,380 104,370

678,423 892,000

As at 31 December 2013, the Company had the following shares held as treasury shares following repurchase of its own shares, including the buy-backs. These shares may be cancelled and re-issued at a later date.

Authorised Nominal 31 December 2013 Number Class value EUR

1,674 A Ordinary EUR 0.01 17 11,282 A Specified Capital Ordinary EUR 10.00 112,820 7,400,000 B Specified Capital Ordinary EUR 0.01 74,000 7,938 Priority Specified Capital Ordinary EUR 10.00 79,380

266,217

Each of the Priority Specified Capital Ordinary Shares, the A Specified Capital Ordinary Shares, the B Specified Capital Ordinary Shares, the A Ordinary Shares, the B Ordinary Shares and the C Ordinary Shares constitute separate classes of Shares. The A Specified Capital Ordinary Shares and the B Specified Capital Ordinary Shares shall rank equally for all purposes unless otherwise stated in these Articles. The A Ordinary Shares, B Ordinary Shares and C Ordinary Shares shall rank equally for all purposes unless otherwise stated in these Articles. As regards the B Ordinary Shares: a) the Board shall in its absolute discretion designate any B Ordinary Share proposed to be issued by the Company as either a Category I B Ordinary Share or a Category II B Ordinary Share at the time of issue of any such share and shall notify the subscriber of any such share in writing accordingly (a ‘‘Designation Notice’’); (b) in the event that no such Designation Notice is issued by the Board within 30 days from the date of issue of any B Ordinary Shares, then the relevant B Ordinary Shares shall be designated Category II B Ordinary Shares: (c) once issued and designated by the Board as Category I B Ordinary Shares or Category II B Ordinary Shares as the case may be the designation of such shares shall not be changed, save that the Company may with the prior approval of a special resolution of the Company duly passed re-designate any B Ordinary Share: and (d) the B Ordinary Shares shall have the rights and be subject to the restrictions set out in these Articles, shall constitute a single class of shares and shall rank equally for all purposes save as expressly stated in these Articles.

260 As regards the C Ordinary Shares: (a) the Board shall in its absolute discretion designate any C Ordinary Share proposed to be issued by the Company as either a Category I C Ordinary Share or a Category II C Ordinary Share at the time of issue of any such share and shall notify the subscriber of any such share in writing accordingly (a ‘‘Designation Notice’’); (b) in the event that no such Designation Notice is issued by the Board within 30 days from the date of issue of any C Ordinary Shares, then the relevant C Ordinary Shares shall be designated Category I C Ordinary Shares; (c) any C ordinary shares of e0.01 each in the capital of the Company in issue on or prior to the First Amendment Date shall be designated as Category I C Ordinary Shares; (d) once issued and designated by the Board as Category I C Ordinary Shares or Category II C Ordinary Shares as the case may be the designation of such shares shall not be changed, save that: (i) either the Board or the board of directors of MB Employee Nominees Limited (registered in England & Wales, company number 06410116) (‘‘MBENL’’) may by resolution passed at any time re-designate any C Ordinary Share registered in the name of MBENL and not held by MBENL as nominee, trustee or agent for any Employee pursuant to any Employee Share Scheme; and (ii) the Company may with the prior approval of a special resolution of the Company duly passed re-designate any C Ordinary Share, in each case either as a Category I C Ordinary Share or a Category II C Ordinary Share as the case may be; and (e) save as expressly stated in these Articles, the C Ordinary Shares shall have the rights and be subject to the restrictions set out in these Articles, shall constitute a single class of shares and shall rank equally for all purposes. Each Category I B Ordinary Share shall entitle its holder to receive notice of, attend and vote at any general meeting of the Company. Each A Ordinary Share and each Category II B Ordinary Share shall entitle its holder to receive notice of and attend any general meeting of the Company but shall not entitle the holder to vote upon any resolution other than: (a) a resolution for winding up the Company or reducing its share capital; or (b) a resolution directly or adversely varying or abrogating any of the special rights attached to the A Ordinary Shares or the Category II B Ordinary Shares, as the case may be. The Speciﬁed Capital Ordinary Shares and the C Ordinary Shares shall not be entitled to receive notice of or attend or vote at any general meeting of the Company. Subject to Article 1.1, votes attaching to Category I B Ordinary Shares may be exercised: (a) on a show of hands by every Shareholder who, being an individual, is present in person or, being a corporation, is present by a representative or a Proxy not being himself a Shareholder, in which case each Shareholder holding Shares with votes shall have one vote; and (b) on a poll by every Shareholder who, being an individual, is present in person or by proxy or, being a corporation, is present by a representative or by a proxy, in which case each Shareholder holding Shares with votes shall have one vote for each Share held.

26. SHARE-BASED PAYMENT TRANSACTIONS Equity-settled share-based payments – Executive Share Ownership Plan In 2014, as a result of the sale to CVC, there are no equity-settled share-based payments. In 2013, Skrill Group Limited had in issue a number of ‘C I’ and ‘C II’ Ordinary shares of e0.01 at par. The ‘C I’ shares were held by MB Employee Nominees Limited, a related subsidiary company and ‘C II’ shares were issued to employees and their holding vehicles as consideration for an acquisition that was completed. The shares are held in trust for a number of employees of the Skrill Group, under an Executive Share Ownership Plan. The employees paid for these shares directly and beneﬁcially own the shares and they are held in trust by the subsidiary until the occurrence of an exit event. The proceeds then would be transferred to each employee as appropriate. An employee is required to return the ‘C’ shares for the consideration paid, if they

261 become a leaver before a deﬁned exit event. These shares had no intrinsic value at the date of grant.

The number of ‘C I’ and ‘‘C II’’ ordinary shares of g0.01 at par at the end of each year were:

Year ended 31 December Number

2014 — 2013 49,885

27. NOTES TO THE CASH FLOW STATEMENT

30 June 30 June 31December 31December 2015 2014 2014 2013

Operating proﬁt 23,744 22,521 57,271 44,047 Adjustments for: Depreciation and amortisation (note 15 and 16) 11,728 11,761 24,489 19,522 Deposit income (3,171) (3,063) (7,239) (7,985)

Operating cash ﬂows before movements in working capital 32,301 31,219 74,521 55,584 Decrease in inventories 70 831 444 145 Increase in trade and other receivables (23,611) (39,979) (16,091) (24,812) Increase in trade and other payables (3,687) 233,306 139,823 40,918

Cash generated by operations 5,073 225,377 198,697 71,835

Income taxes paid 676 (2,578) (7,661) (7,516) Interest paid (21) (1,197) (4,018) (7,297) Interest received 3,178 2,774 6,617 9,162

Net cash generated from operating activities 8,906 224,376 193,635 66,184

Cash and cash equivalents

30 June 30 June 31December 31December 2015 2014 2014 2013

Cash and cash equivalents 661,272 628,322 677,011 647,031

Cash and cash equivalents comprise cash. The carrying amount of these assets is approximately equal to their fair value. In accordance with an agreement with a speciﬁc provider certain cash is restricted and is based upon the highest of 4 days authorised or settlement liability in any period. Such sums are calculated by the provider. At 31 December 2014 the cash balances include an amount of $5,377,000 relating to restricted cash (2013: $3,565,000). At 30 June 2015 the cash balances include an amount of $128,000 relating to restricted cash (30 June 2014: $6,478,000). Skrill Limited and Prepaid Services Company Limited, FCA regulated entities, are required at all times to have qualifying liquid assets (comprising cash and cash equivalents and investments) in excess of the e-money ﬂoat (see note 31).

28. BUSINESS COMBINATIONS On 31 March 2015, the Group acquired 100% of the issued share capital of Smart Voucher Limited (‘‘Ukash’’), the UK prepaid payments business.

262 The following table summarises the consideration paid for Ukash, the fair value of assets acquired and liabilities assumed at the acquisition date.

As at 31 March 2015

Cash 49,651

Total Consideration 49,651

Recognised amounts of identiﬁable assets acquired and liabilities assumed: Cash and cash equivalents 47,295 Trade and other receivables 9,426 Inventory 34 Fixed assets 594 Intangible assets 797 Deferred tax assets 1,055 Loan receivables 13,111 Trade and other payables (40,661) E-Money ﬂoat (8,265) Income tax liabilities (2) Provisions (1,034)

Total identiﬁable net assets 22,878

Goodwill as at 31 March 2015 26,773

Acquisition-related costs have been charged to administrative expenses in the consolidated income statement for the period ended 30 June 2015. During the 6 month period to 30 June 2015 the revenue included in the consolidated statement of comprehensive income contributed by Ukash was $11,471,000. Ukash realised loss after tax of $1,804,000 over the same period. Had Ukash been consolidated from 1 January 2015, the consolidated statement of income for 6 months 2015 would show pro-forma revenue of $184,525,000 and proﬁt after tax of $16,697,000. On 8 February 2013, the Group acquired 100% of the issued share capital of paysafecard.com Wertkarten AG (‘‘paysafecard’’), the Austrian prepaid payments business. The following table summarises the consideration paid for paysafecard, the fair value of assets acquired and liabilities assumed at the acquisition date.

263 The following table summarises the consideration paid for paysafecard, the fair value of assets acquired and liabilities assumed at the acquisition date.

As at 8 February 2013

Cash 107,952 Contingent consideration 69,494 Deferred consideration 7,152

Total Consideration 184,598

Recognised amounts of identiﬁable assets acquired and liabilities assumed: Cash and cash equivalents 135,217 Trade and other receivables 69,008 Inventory 1,702 Fixed assets 2,648 Deferred tax assets 1,909 Trade and other payables (145,380) E-money ﬂoat (47,627) Income tax liabilities (1,837) Financial liabilities (3,479)

Total identiﬁable net assets 12,161

Identiﬁed Intangible Assets 95,133 Deferred tax liability on identiﬁed intangible assets at 25% (23,783)

Goodwill as at 8 February 2013 (note 14) 101,087

Acquisition-related costs of $932,000 have been charged to administrative expenses in the consolidated income statement for the year ended 31 December 2013. Contingent consideration in the amount of $69,494,000 was outstanding as at 31 December 2013 and is classified as current provision: $35,785,000 and non-current provision: $33,709,000. As at 31 December 2013 the deferred consideration was presented within ‘‘other payables’’ in note 24 Trade and other payables. Contingent and deferred considerations were repaid in February 2014, ahead of the originally agreed timeline, as a result of the transfer of the ownership of the Group. During 2013 the revenue included in the consolidated statement of comprehensive income contributed by paysafecard was $146,180,000. paysafecard also contributed profit after tax of $20,820,000 over the same period. Had paysafecard been consolidated from 1 January 2013, the consolidated statement of income for 2013 would show pro-forma revenue of $299,132,000 and profit after tax of $27,840,000.

264 29. OPERATING LEASE a) Operating lease expenses during the year

30 June 30 June 31December 31December 2015 2014 2014 2013

Minimum lease payments under operating leases recognised as an expense in the year (note 6) 1,020 1,100 2,942 2,586

1,020 1,100 2,942 2,586 b) Operating lease commitments – the Group as lessee At the balance sheet date, the Group had outstanding commitments for future minimum lease payments under non-cancellable operating leases, which fall due as follows:

30 June 30 June 31December 31December 2015 2014 2014 2013

Within one year 1,783 2,353 2,326 1,559 In the second to ﬁfth years inclusive 4,597 6,017 6,123 4,489

6,380 8,370 8,449 6,048

Operating lease payments represent rentals payable by the Group for certain of its ofﬁce properties. Leases are negotiated for an average term of 10 years and rentals are ﬁxed for an average of 5 years with an option to extend for a further 5 years at the then prevailing market rate.

30. FINANCIAL INSTRUMENTS Financial risk factors The Group’s activities expose it to a variety of financial risks: market risk (including currency risk, fair value interest rate risk and cash flow interest rate risk), credit risk and liquidity risk. The Group’s overall risk management programme focuses on the unpredictability of financial markets and seeks to minimise potential adverse effects on the Group’s financial performance.

265 The carrying amounts of the Group’s foreign currency denominated monetary assets and monetary liabilities at the reporting dates are as follows:

Foreign currency risk management 30 June

Liabilities Assets

2015 2014 2015 2014

United Kingdom (GBP) 52,651 40,010 127,203 49,864 USA (USD) 154,411 145,353 165,477 152,395 Other 80,528 80,225 99,875 92,880 31 December

Liabilities Assets

2014 2013 2014 2013

United Kingdom (GBP) 43,699 45,089 56,384 46,201 USA (USD) 157,446 153,806 163,421 164,047 Other 84,043 81,492 109,573 57,439 Foreign currency sensitivity analysis The Group is mainly exposed to the currency of the United Kingdom (GBP) and the currency of the United States of America (USD). The Group is required to disclose the impact of a deﬁned change in the relative strength of its functional currency against other foreign currencies that the Group is exposed to. The Group has determined that 10 per cent is the sensitivity rate used when reporting foreign currency risk internally to key management personnel and represents management’s assessment of the reasonably possible change in foreign exchange rates. The following table details the Group’s sensitivity to a 10 per cent strengthening of GBP against EUR and USD against EUR taking into account the outstanding foreign currency denominated monetary items at the relevant year and period ends:

30 June GBP impact USD impact

2015 2014 2015 2014

Proﬁt /(loss) for a 10% strengthening of the relevant currencies against EUR* 5,968 772 886 552 31 December GBP impact USD impact

2014 2013 2014 2013

Proﬁt /(loss) for a 10% strengthening of the relevant currencies against EUR* 1,088 82 513 758

* A 10% weakening of the relevant currencies against EUR would have the opposite effect on the Group’s results for each period.

266 predominantly investing funds in financial instruments with short-term maturities in line with applicable FCA rules and regulations. The Group’s exposures to interest rates on financial assets and financial liabilities are detailed in the liquidity risk management section of this note. Based on the various scenarios, the Group manages its cash flow interest rate risk by using floating-to-fixed interest rate swaps. Such interest rate swaps have the economic effect of converting borrowings from floating rates to fixed rates. Generally, the Group raises long-term borrowings at floating rates and swaps them into fixed rates that are lower than those available if the Group borrowed at fixed rates directly. Under the interest rate swaps, the Group agrees with other parties to exchange, at specified intervals (quarterly), the difference between fixed contract rates and floating-rate interest amounts calculated by reference to the agreed notional amounts. These swaps are designated to hedge underlying debt obligations. The Group hedges 67% of its borrowings in 2013. In 2014, the hedge was terminated as a result of the repayment of the related loan.

Interest rate sensitivity analysis The sensitivity analysis below has been determined based on the exposure to interest rates for non-derivative instruments at each of the balance sheet dates. For floating rate liabilities, the analysis is prepared assuming the amount of liability outstanding at the balance sheet date was outstanding for the whole year. A 1 percent increase or decrease is used when reporting interest rate risk internally to key management personnel and represents management’s assessment of a reasonably possible change in interest rates. If interest rates had been 1 percent higher/lower and all other variables were held constant, the Group’s: * profit for the period ended 30 June 2015 would increase/decrease by $857,000; * profit for the period ended 30 June 2014 would increase/decrease by $8,000; * profit for the year ended 31 December 2014 would increase/decrease by $467,000; and * profit for the period ended 31 December 2013 would increase/decrease by $1,500,640. The Group’s sensitivity to interest rates has changed mainly due to change in the Group debt structure (note 22).

267 The credit risk on liquid funds is limited because the counterparties are banks with high credit- ratings assigned by international credit-rating agencies as shown below.

31December 31December 30 Jun 2015 30 Jun 2014 2014 2013

Cash and cash equivalents (note 27) Standard and Poors, Fitch and Moody’s credit ratings A+ — 86,516 27,587 101,192 AA+ 359 332 700 606 AA- 132 5,446 (1,455) 17,305 A 14,763 90,720 129,783 181,564 A1 11,841 — — — A2 94,149 — — — A- 1,806 59,213 101,742 8,349 A3 41,897 — 44 — Aa2 3,205 — 955 — Aa3 36,547 — — — B+ — — — 7,434 B — 4,527 — 23 B- 296 — — — Ba1 2,311 194 — — Ba2 3,737 1,098 1 27,237 Ba3 1,444 — — — B1 — — 4,038 — B2 156 — — — Baa1 30,420 — — — Baa2 88,422 — — — Baa3 57,652 — — 65,327 B3 6 76,770 — 63 BB 2,183 890 6,682 8,209 BB- — 283 101 1,035 BB+ 44,925 83,910 50,821 112,602 BBB 73,344 99,483 13,941 42,077 BBB+ 57,636 75 3,684 24,117 BBB- 20,158 79,849 293,206 46,517 Caa3 32 — — — CC — — 305 — CCC+ — — 85 — CCC 156 457 142 43 Other 73,695 38,559 44,649 3,331

661,272 628,322 677,011 647,031

Other relates to balances in financial institutions, which are not rated by independent rating agencies. These accounts are opened in order to accommodate merchants and end users in countries where a local bank is required to facilitate deposits and/or withdrawals. In order to mitigate the risk of default, the balances in the above mentioned institutions are continuously monitored by the treasury functions and reviewed on a continuous basis by the risk management committee. The carrying amount of financial assets recorded in the financial information, which is net of impairment losses, represents the Group’s maximum exposure to credit risk as no collateral or other credit enhancements are held.

268 Liquidity risk management Liquidity risk refers to the risk that an entity will not have sufficient funds available at any given time to meet its obligations on time. As part of established management mechanisms, rolling financial planning is monitored at management level. paysafecard.com Wertkarten GmbH is obliged to provide for permanent coverage of the balances kept with the partner banks. These balances include incoming payments from distribution partners and outgoing payments to merchants. A permanent liquidity is guaranteed by a deliberate system of setting payment dates and paysafecard.com Wertkarten GmbH normally does not have to advance funds for the purpose of securing liquidity. A liquidity risk results from potential late payments by distribution partners. To minimise the liquidity risk, incoming payments are checked daily and in case of delayed payments adequate measures (reminder, delivery stop etc.) are taken immediately. The Group has significant net cash balances as at the balance sheet date. Liquidity risk is monitored on a daily basis and is kept within the FCA requirements for e-money issuers. Management closely monitors the cash position of the Group on a continuous basis to ensure sufficient liquidity exists for business needs. The Group has positive cash flows from operating activities, and the cash balances are adequate to finance the ongoing working capital and capital investment requirements of the Group’s operations. The Group balances the flexible use of funding by way of loans to / from Group companies. The following tables detail the Group’s remaining contractual maturity for its financial liabilities with agreed repayment periods. The tables have been drawn up based on the contractual undiscounted cash flows of financial liabilities based on the earliest date on which the Group can be required to pay.

Less than Between 1 Between 2 Over 1 year and 2 years and 5 years 5 years Total

30 June 2015 Trade payables (note 24) 143,025 — — — 143,025 E-money ﬂoat (note 24) 520,976 — — — 520,976 Other payables and accruals (note 24) 36,324 — — — 36,324 Related party payables (note 24, 32) 44,303 — — — 44,303 Bank borrowings (note 22) — — 53 — 53 Related party borrowings and accrued interest (note 22, 32) — 13,074 22,513 155,810 191,397 Finance lease (note 22) 230 158 — — 388

744,858 13,233 22,566 155,810 936,467

30 June 2014 Trade payables (note 24) 151,314 — — — 151,314 E-money ﬂoat (note 24) 533,960 — — — 533,960 Other payables and accruals (note 24) 27,165 — — — 27,165 Related party payables (note 24, 32) 215,877 — — — 215,877 Derivatives (note 21) — — — — — Bank borrowings (note 22) — — 65 — 65 Finance lease (note 22) 277 282 200 — 759

928,593 14,337 42,429 107,878 929,140

269 Less than Between 1 Between 2 Over 1 year and 2 years and 5 years 5 years Total

31 December 2014 Trade payables (note 24) 164,127 — — — 164,127 E-money ﬂoat (note 24) 560,949 — — — 560,949 Other payables and accruals (note 24) 27,957 — — — 27,957 Related party payables (note 24, 32) 14,744 — — — 14,744 Bank borrowings (note 22) — — 58 — 58 Related party borrowings and accrued interest (note 22, 32) — 12,519 29,571 108,193 150,283 Finance lease (note 22) 252 258 43 — 553

768,029 12,777 29,672 108,193 918,671

31 December 2013 Trade payables (note 24) 166,582 — — — 166,582 E-money ﬂoat (note 24) 514,312 — — — 514,312 Other payables and accruals (note 24) 34,211 — — — 34,211 Derivatives (note 21) 701 65 — — 766 Bank borrowings (note 22) 11,452 11,451 127,768 — 150,671 Finance lease (note 22) 279 285 342 — 906

727,537 11,801 128,110 — 867,448

Maturity of financial assets The Group’s financial assets consist of loans and receivables (cash and cash equivalents and trade and other receivables) which have a maturity of less than 3 months and assets held at fair value through profit and loss. At 30 June 2015 and 2014 or 31 December 2014 and 2013, there are no investments that have a maturity date within 3 months.

The capital structure of the Group consists of debt, which includes the borrowings disclosed in note 22 and equity attributable to equity holders of Skrill Group Limited, comprising issued capital, reserves and retained earnings.

Fair value of ﬁnancial instruments

Fair value of financial instrument carried at amortised cost The Directors consider that the carrying amounts of financial assets and financial liabilities recorded at amortised cost in the financial information approximate their fair values. All fair value measurements are those derived from quoted prices (unadjusted) in active markets for identical assets or liabilities.

Valuation techniques and assumptions applied for the purposes of measuring fair value The fair values of ﬁnancial assets and ﬁnancial liabilities are determined with standard terms and conditions, are traded on active liquid markets and are determined with reference to quoted market prices (includes listed bonds).

The following table presents the Group’s assets and liabilities that are measured at fair value at the respective period and year ends.

270 Financial instruments by category

30 June 30 June 31December 31December 2015 2014 2014 2013

Assets as per balance sheet Available for sale investment (note 18) 145 869 327 1,358 Convertible bonds (note 18) 112 137 133 134 Loans and receivables – Trade and other receivables (note 20) 151,268 162,678 130,388 126,731 – Cash and cash equivalents (note 27) 661,272 628,322 677,011 647,031

TOTAL FINANCIAL ASSETS 812,797 792,006 807,859 775,254

Liabilities as per balance sheet Financial liabilities at amortised cost Trade and other payables (note 24) 744,628 928,316 767,777 715,105 Bank borrowings (note 22) 53 65 58 143,458 Related party borrowings (note 22, 32) 174,920 — 138,185 — Interest on related party borrowings (note 22, 32) 18,977 — 12,098 — Finance lease liabilities (note 22) 388 759 553 906 Derivative ﬁnancial instruments Cash ﬂow hedge (note 21) — — — 766

TOTAL FINANCIAL LIABILITIES 938,966 929,140 918,671 860,235

31. FCA regulatory capital requirements The Group has three entities that are registered with the FCA: Skrill Limited, Skrill International Payments Limited and Prepaid Services Company Limited. Skrill Limited: A minimum amount of capital, of Skrill Limited, is required by the FCA. The FCA’s regulatory requirement is, at any time, for Skrill Limited to have initial capital in excess of EUR 350,000 and hold regulatory own funds which are 2% of the average daily outstanding e-money amount at the end of each calendar day over the preceding 6 month period. The FCA regulatory capital requirements and Skrill Limited’s regulatory own funds at the period and year ends are as follows:

30 June 30 June 31December 31December 2015 2014 2014 2013

FCA regulatory capital requirements 9,278 9,032 8,950 8,593 Regulatory own funds 158,415 158,590 186,752 159,933

Skrill Limited, an FCA regulated entity, is required at all times to have qualifying liquid assets in excess of the e-money ﬂoat. The balances are as per the table below. Qualifying liquid assets of Skrill Limited are made up of cash and cash equivalents. Skrill Limited was in compliance with the requirement for the periods ended 30 June 2014 and 30 June 2015 and the years ended 31 December 2014 and 2013.

271 31. Skrill Limited

30 June 30 June 31December 31December 2015 2014 2014 2013

Qualifying liquid assets 494,926 484,389 516,990 457,293 E-money ﬂoat 452,706 467,031 489,823 444,339

Skrill International Payments Limited During 2011, Skrill International Payments Limited was registered as an Authorised Payment Institution in the UK and is regulated by the FCA under the Payment Services Regulations 2009 (‘‘PSRs’’). No revenues were earned through the provision of this service during the presented periods. The FCA’s regulatory requirement is to have initial capital of EUR 50,000.

Skrill International Payments Limited

30 June 30 June 31December 31December 2015 2014 2014 2013

FCA regulatory initial capital requirements 55 68 61 69 Regulatory own funds 1,355 1,059 940 1,021

Prepaid Services Company Limited Prepaid Services Company Limited (‘‘PSC Limited’’) is required by The Electronic Money Regulations 2011 (‘‘EMRs’’) and by the implementing rules specified by the Financial Conduct Authority (‘‘FCA’’) to maintain a specified minimum amount of own funds (capital). The FCA requires that, as an authorised electronic money institution (‘‘AEMI’’), PSC Limited must hold, at all times, capital equal to or in excess of either EUR 350,000 or 2% of the average daily outstanding e-money amount at the end of each calendar day over the preceding 6-month period, whichever is higher. Furthermore, PSC Limited is engaged in unrelated payment services, and thus is subject to an additional ongoing capital requirement with respect to this part of its business. PSC Limited calculates the additional capital requirement for unrelated payment services by applying the fixed overheads method (Method A): that is, 10% of fixed overheads for the preceding year. The total regulatory capital requirement for PSC Limited and the actual total of qualifying capital resources held by PSC Limited at period and year ends are as follows:

30 June 30 June 31December 31December 2015 2014 2014 2013

Total regulatory capital requirement 975 1,145 1,071 1,108 Total of qualifying capital resources 6,320 2,055 1,873 2,205

As an AEMI, PSC Limited is required at all times to appropriately safeguard funds equal to the total of outstanding e-money issued by PSC Limited, in the form of qualifying assets of types approved by the FCA as secure, low-risk and liquid. (Safeguarded funds held in the form of qualifying assets may exceed the total of outstanding e-money.) The balances are as per the table below. Safeguarded qualifying assets of PSC Limited are made up of cash and cash equivalents. PSC Limited was in compliance with safeguarding and own funds requirements for the periods ended 30 June 2015 and 30 June 2014 and the years ended 31 December 2014 and 31 December 2013.

30 June 30 June 31December 31December 2015 2014 2014 2013

Safeguarded qualifying assets 89,474 112,555 124,432 120,759 Outstanding e-money 33,079 43,135 41,020 43,271

272 Smart Voucher Limited Smart Voucher Limited is required by the Electronic Money Regulations 2011 (‘‘EMRs’’) and by implementing rules specified by the Financial Conduct Authority (‘‘FCA’’) to maintain a specified minimum amount of own funds (capital). The FCA requires that, as an authorised electronic money institution (‘‘AEMI’’), Smart Voucher Limited must hold, at all times, capital equal to or in excess of either e350,000 or 2 per cent. of the average daily outstanding e-money amount at the end of each calendar day over the preceding 6-month period, whichever is higher. Furthermore, Smart Voucher Limited is engaged in unrelated payment services, and thus is subjected to an additional ongoing capital requirement with respect to this part of the business. Smart Voucher Limited calculates the additional capital requirement for unrelated payment services by applying the fixed overheads methods (Method A): that is, 10 per cent. of fixed overheads for the preceding period. The total regulatory capital requirement for Smart Voucher Limited and the actual total or qualifying capital resources held by Smart Voucher Limited at period end are as follows:

30 June 30 June 31December 31December 2015 2014 2014 2013

Total regulatory capital requirement 386 n.a n.a n.a Total of qualifying capital resources 22,671 n.a n.a n.a As an AEMI, Smart Voucher Limited is required at all times to appropriately safeguard funds equal to the total of outstanding e-money issued by Smart Voucher Limited, in the form of qualifying assets of types approved by the FCA as secure, low-risk and liquid. (Safeguarded funds held in the form of qualifying assets may exceed the total of outstanding e- money.) The balances are as per the table below. Safeguarded qualifying assets of Smart Voucher Limited are made up of cash and cash equivalents. Smart Voucher Limited was in compliance with safeguarding and own funds requirements for the period ended 31 December 2014.

30 June 30 June 31December 31December 2015 2014 2014 2013

Safeguarded qualifying assets 6,925 n.a n.a n.a Outstanding e-money 2,301 n.a n.a n.a

32. RELATED PARTY TRANSACTIONS Balances and transactions between the Company and its subsidiaries, which are related parties, have been eliminated on consolidation and are not disclosed in this note. The disclosed amounts below relate to related parties which are not part of the consolidation and for this reason are not eliminated.

Related party receivables (note 20)

30 June 30 June 31December 31December 2015 2014 2014 2013

Parent company 52,493 28,200 145 — Companies under common control 871 878 928 —

53,364 29,078 1,073 —

The related party receivables are not overdue, neither impaired and are considered fully recoverable.

273 Related party payables (note 24)

30 June 30 June 31December 31December 2015 2014 2014 2013

Parent company 44,303 215,877 14,744 — 44,303 215,877 14,744 —

The outstanding related party borrowings and interest are the following:

Related party borrowings (note 22)

30 June 30 June 31December 31December 2015 2014 2014 2013

Parent company – borrowings 172,420 — 138,185 — – interest payable 18,977 — 12,098 —

191,397 — 150,283 —

30 June 30 June 31December 31December 2015 2014 2014 2013

Short-term employee benefits 331 262 254 2,863 Termination benefits — — — 161 Post-employment benefits 16 33 32 94

Full disclosure of the remuneration and other incentive arrangement of the directors are provided in note 9.

33. CONTINGENT LIABILITIES Skrill Group Limited, MB Acquisitions Limited, Skrill Holdings Limited, Skrill Limited, Sabemul Beteiligungsverwaltungs GmbH, paysafecard.com Wertkarten GmbH, paysafecard.com Vertriebs GmbH and MAC Limited are participants in a group banking arrangement for bank facilities advanced to group companies. The companies are guarantors in respect of bank borrowings received by the immediate parent Sentinel Bidco Limited. The Group may be subject to legal claims and actions and takes legal advice as to the likelihood of success of any potential claims and actions. No provision or disclosure is made where the Directors feel, based on that advice, the action is unlikely to result in a material loss or a sufﬁciently reliable estimate of the potential obligation cannot be made.

34. ULTIMATE CONTROLLING PARTY As at 30 June 2015 and 31 December 2014 the ultimate holding company and controlling party is CVC Capital Partners SICAV-FIS S.A., a company registered in Luxembourg.

35. SUBSEQUENT EVENTS On 23 March 2015, Paysafe Group plc entered into an agreement to acquire 100% of the issued share capital of Sentinel Topco Limited, the intermediate parent of Skrill Group limited, and its subsidiaries. The transaction was completed on 10 August 2015 after clearance by the Financial Conduct Authority was received.

274 SECTION E: AUDITED FINANCIAL INFORMATION OF THE SKRILL OPERATING GROUP FOR THE THREE YEARS ENDED 31 DECEMBER 2013

The audited consolidated financial statements of the Skrill Operating Group for the three years ended 31 December 2013, together with the accountants’ reports for the three years ended 31 December 2013, are set out on pages 240 to 283 of the March 2015 Prospectus are incorporated by reference into this document. The accountants’ reports for the three years ended 31 December 2013 were unqualified. The audited consolidated financial statements of paysafecard.com Wertkarten GmbH for the three years ended 31 December 2013, together with the accountants’ reports for the three years ended 31 December 2013, are set out on pages 324 to 451 of the March 2015 Prospectus are incorporated by reference into this document. See Part XII (Information Incorporated by Reference) of this document for further details about information that has been incorporated by reference into this document.

275 PART VII

UNAUDITED PRO FORMA FINANCIAL INFORMATION SECTION A: ACCOUNTANT’S REPORT ON THE UNAUDITED PRO FORMA FINANCIAL INFORMATION

The Directors Paysafe Group plc Audax House 6 Finch Road Douglas Isle of Man

18 December 2015

Dear Sirs Paysafe Group plc (‘‘Paysafe’’) We report on the pro forma financial information (the ‘‘Pro Forma Financial Information’’) set out in Section B of Part VII of the Prospectus dated 18 December 2015, which has been prepared on the basis described in the notes contained therein, for illustrative purposes only, to provide information about how the transaction might have affected the financial information presented on the basis of the accounting policies adopted by the Company in preparing the financial statements for the six month period ended 30 June 2015. This report is required by Commission Regulation (EC) No 809/2004 (the ‘‘Prospectus Directive Regulation’’) and is given for the purpose of complying with that requirement and for no other purpose.

Responsibilities The Directors of Paysafe are responsible for preparing the Pro Forma Financial Information on the basis of preparation set out in the notes contained therein and in accordance with International Financial Reporting Standards as adopted by the European Union. It is our responsibility to form an opinion on the Pro Forma Financial Information and to report our opinion to you. In providing this opinion we are not updating or refreshing any reports or opinions previously made by us on any ﬁnancial information used in the compilation of the Pro Forma Financial information, nor do we accept responsibility for such reports or opinions beyond that owed to those to whom these reports or opinions were addressed by us at their date of issue. Save for any responsibility arising under Prospectus Rules 5.5.3R(2)(f) to any person as and to the extent there provided, to the fullest extent permitted by law we do not assume any responsibility and will not accept any liability to any other person for any loss suffered by any such other person as a result of, arising out of, or in connection with this report or our statement, required by and given solely for the purposes of complying with paragraph 23.1 of Annex I of the Prospectus Directive Regulation, consenting to its inclusion in the Prospectus.

276 Our work has not been carried out in accordance with auditing or other standards and practices generally accepted in the United States of America and accordingly, should be relied upon as if it has been carried out in accordance with those standards and practices.

Opinion on the Pro Forma Financial Information In our opinion, the Pro Forma Financial Information has been properly compiled on the basis stated and such basis is consistent with the accounting policies of the Company.

Yours faithfully

KPMG Audit LLC

277 SECTION B: UNAUDITED PRO FORMA FINANCIAL INFORMATION

The following unaudited pro forma statement of net assets and statement of comprehensive income (the ‘‘Pro Forma Financial Information’’) have been prepared to show the effect on the consolidated net assets and consolidated net income of the Paysafe Group as if the Skrill Acquisition and the Rights Issue had occurred on 1 January 2015. The Pro Forma Financial Information has been prepared for illustrative purposes only and in accordance with Annex II of the Prospectus Directive Regulation, and should be read in conjunction with the notes set out below. Due to its nature, the Pro Forma Financial Information addresses a hypothetical situation and, therefore, does not represent the Paysafe Group’s actual financial position or results. The Pro Forma Financial Information has not been prepared, or shall not be construed as having been prepared, in accordance with Regulation S-X under the US Securities Act. In addition, the unaudited pro forma financial information does not purport to represent what the Paysafe Group’s financial position and results of operations actually would have been if the Skrill Acquisition had been completed on the dates indicated nor do they purport to represent the results of operations for any future period or the financial condition at any future date. The pro forma statement of net assets set out below is based on the net assets of the Paysafe Group as at 30 June 2015 adjusted to reflect the net assets of the Skrill Group as at 30 June 2015 presented in accordance with the Company’s accounting policies (and other adjustments as described in the notes below). The pro forma statement of comprehensive income set out below is based on the income statement of the Paysafe Group for the six months ended 30 June 2015, adjusted to reflect the net income of the Skrill Group for the six months ended 30 June 2015, presented in accordance with the Company’s accounting policies (and other adjustments as described in the notes below). Shareholders and prospective investors should read the whole of this document and not rely solely on the summarised financial information contained in this Part VII (Unaudited Pro Forma Financial Information). The Accountant’s Report on the Pro Forma Financial Information is set out in Section A of this Part VII.

278 Unaudited Pro Forma Statement of Consolidated Net Assets

Consideration Paysafe Skrill Group cash payment 30 June 30 June Skrill Debt and debt Consolidation 2015 2015 Acquisition proceeds repayment adjustments Total US$’000 US$’000 US$’000 US$’000 US$’000 US$’000 US$’000 Note 1 Note 2 Note 3 Note 4 Note 4

ASSETS Non-current assets Investments 343 343 Deferred income tax asset 7,588 7,588 Property, plant & equipment 14,182 9,095 23,277 Intangible assets 75,108 370,824 445,932 Goodwill 208,714 416,695 512,910 1,138,319

298,004 804,545 — — — 512,910 1,615,459 Current asset Investments 579,345 (579,345) — Cash and cash equivalents 798,562 662,262 555,000 (1,271,377) 744,447 Settlement assets 40,081 40,081 Restricted NETELLER merchant cash 290 290 Restricted NETELLER member cash 8,084 8,084 Cash held as reserves 8,923 8,923 Trade and other receivables 17,116 105,816 122,932 Inventories 1,075 1,075 Prepaid expenses and deposits 4,752 4,752

877,808 769,153 579,345 555,000 (1,271,377) (579,345) 930,584

Total assets 1,175,812 1,573,698 579,345 555,000 (1,271,377) (66,435) 2,546,043

LIABILITIES Non-current liabilities Provisions (171) (171) Deferred income tax liability (75,920) (75,920) Obligations under ﬁnance lease (192) (192) Share consideration payable (44,887) (44,887) Contingent consideration (2,084) (2,084) Derivative ﬁnancial instruments (1,814) 1,814 — Borrowings (97,000) (712,684) 390,561 (555,000) 419,123 (555,000)

(144,163) (790,589) 390,561 (555,000) 420,937 — (678,254)

Current liabilities Trade and other payables (38,794) (702,112) (740,906) Provisions (3,308) (3,308) NETELLER loyalty program liability (1,214) (1,214) Provision for losses on NETBANX merchant accounts (1,183) (1,183) NETBANX merchant processing liabilities (35,527) (35,527) Taxes payable (3,528) (8,954) (12,482) Contingent consideration (5,000) (5,000) Share consideration payable (18,143) (18,143) Obligations under ﬁnance lease (281) (281) Derivative ﬁnancial instruments (28,940) (2,070) 31,010 — Current portion of long-term debt (20,000) (230) 20,230 —

(152,610) (716,674) — — 51,240 — (818,044) Net assets / liabilities 879,039 66,435 969,906 — (799,200) (66,435) 1,049,745

279 Unaudited Pro Forma Consolidated Statement of Comprehensive Income

Paysafe Six Skrill Group month period Six month Adjustment Adjustment ended 30 June period ended for Ukash for FANS 2015 30 June 2015 Acquisition Acquisition Total US$’000 US$’000 US$’000 US$’000 US$’000 Note 1 Note 2 Note 5 Note 6

Revenue Straight Through Processing fees 173,034 173,034 Stored Value fees 49,757 49,757 Investment and other income 232 232 Revenue 172,979 11,220 182 184,381

223,023 172,979 11,220 182 407,404 Cost of Sales Straight Through Processing expenses (108,782) (108,782) Stored Value expenses (6,317) (6,317) Cost of sales (70,172) — (70,172)

Results from operating activities 7,284 6,598 1,967 (654) 15,195 Net ﬁnance costs (2,691) (34,425) (37,116)

Proﬁt for the year before tax 4,593 (27,827) 1,967 (654) (21,921) Income tax expense (2,184) 1,994 (190)

Total comprehensive proﬁt for the year attributable to the owners of the Group 2,271 (24,131) 1,967 (654) (20,547)

Notes: Refer to the notes on the following pages regarding basis of preparation.

280 Notes to the Unaudited Pro Forma Financial Information: 1. The Paysafe Group’s consolidated net assets at 30 June 2015 and consolidated comprehensive income for the six months ended 30 June 2015 have been extracted without adjustment from the ﬁnancial information presented in Part IV (Financial Information of the Paysafe Group) of this prospectus. No account has been taken of the results of the Paysafe Group since this date.

2. The Skrill Group’s consolidated net assets as at 30 June 2015 and consolidated comprehensive income for the six months ended 30 June 2015 have been extracted without adjustment from the ﬁnancial information presented in Part B (Reported on Financial Information of the Skrill Group for the Six Month Period Ended 30 June 2015 and Audited Financial Information for the Financial Year Ended 31 December 2014) of Part VI (Financial Information of the Skrill Group) which contains the consolidated ﬁnancial information of Sentinel Topco Limited, the holding company of the Skrill group of companies. No account has been taken of the results of the Skrill Group since this date.

3. Pursuant to the Skrill Acquisition, the Paysafe Group acquired 100 per cent. of the issued share capital of Skrill (comprising the ordinary shares and the preference shares and accrued return) and procured that the shareholder loan notes and accrued interest were redeemed at Completion.

4. The consideration for the Skrill Acquisition was settled by the Paysafe Group by way of cash of e720 million (US$799 million) paid at Completion (less the aggregate fees of Sentinel Group Holdings S.A. and the Skrill Group (and the other direct and indirect shareholders) incurred in respect of the Skrill Acquisition transaction and 50 per cent. of the fees incurred in respect of the transfer of Skrill USA Inc. and less an amount equal to the principal outstanding amount of loan notes issued by Sentinel Holdco 2 Limited (Sentinel Topco Limited’s immediate subsidiary) to Sentinel Group Holdings S.A., which was Eur 240,055,202.11 (US$266,394,592.34), and the issue of 37,493,053 Paysafe Ordinary Shares (the ‘‘Skrill Consideration Shares’’), having a fair value of US$171 million on issue. The net debt repaid at Completion was Eur 307.7 million (US$277.2 million).

Paysafe’s existing external bank debt (US$117 million) was reﬁnanced as part of the Skrill Acquisition. Paysafe also repaid the Skrill Group’s external bank debt as part of the Skrill Acquisition. As such a facility of e500 million (US$555 million) was drawn and utilised in respect of repaying the Skrill Group’s external bank debt at Completion and reﬁnancing the Paysafe Group’s external bank debt at Completion.

5. On 31 March 2015, the Skrill Group acquired 100 per cent. of the issued share capital of Smart Voucher Limited (‘‘Ukash’’). As such the income statement activity of this business for period 1 January 2015 to 31 March 2015, being the period prior to the Ukash Acquisition, has been adjusted for in the pro forma consolidated statement of comprehensive income. This information has been extracted from unaudited management financial information for the period without adjustment. This management financial information is prepared on a consistent basis to the financial information of the Paysafe Group, in accordance with International Financial Reporting Standards, as adopted by the European Union and the Paysafe Group’s accounting policies. The income statement activity of Ukash for the period 1 April 2015 to 30 June 2015 is included within the financial information of Skrill in the consolidated statement of comprehensive income. The net assets of Ukash at 30 June 2015 are included within the financial information of Skrill in the consolidated statement of net assets presented.

6. On 22 May 2015 Paysafe Group acquired 100 per cent. of the issued share capital of FANS Entertainment Inc. (‘‘FANS’’). As such the income statement activity of this business for period 1 January 2015 to 22 May 2015, being the period prior to the FANS Acquisition, has been adjusted for in the pro forma consolidated statement of comprehensive income. This information has been extracted from unaudited management financial information for the period without adjustment. This management financial information is prepared on a consistent basis to the financial information of the Paysafe Group, in accordance with International Financial Reporting Standards, as adopted by the European Union and the Paysafe Group’s accounting policies. The income statement activity of FANS for the period 22 May 2015 to 30 June 2015 is included within the financial information of the Paysafe Group in the

281 consolidated statement of comprehensive income. The net assets of FANS at 30 June 2015 are included within the financial information of the Paysafe Group in the consolidated statement of net assets presented. 7. No effect of additional or reduced interest costs to be incurred on the proposed debt financing has been reflected in the pro forma consolidated comprehensive income.

282 PART VIII

CAPITALISATION AND INDEBTEDNESS

The tables below set out the Paysafe Group’s capitalisation and indebtedness. The indebtedness information set out below has been extracted without material adjustment from Paysafe’s unaudited consolidated management accounts as at 30 September 2015. The capitalisation ﬁgures have been extracted without material adjustment from the Paysafe Group’s audited consolidated ﬁnancial statements as at and for the year ended 30 June 2015 with an analysis presented of the material changes to 30 September 2015.

1. CAPITALISATION

As at As at 30 30 June September 2015 Movement 2015

US$’000 Capitalisation Share capital 0.09 0.01 0.09 Legal reserves (own shares held) 0 0 0 Other reserves 878.95 195.41 1,074.36

Total capitalisation 879.04 195.42 1,074.46

283 2. INDEBTEDNESS

As at 30 September 2015 US$’000

Cash 122.56 Restricted cash 5.97 Trading securities

Liquidity 128.53

As at 30 September 2015 US$’000

Indebtedness Total current debt Secured 31.49

Total current debt 31.49

Non-current debt (excluding current portion of long term debt) Secured 530.75 Unguaranteed/unsecured 2.08 Total non-current debt (excluding current portion of long term debt) 532.83

Total indebtedness 564.32

284 PART IX

DIRECTORS, SENIOR MANAGEMENT, CORPORATE GOVERNANCE AND EMPLOYEES

1. DIRECTORS OF PAYSAFE AND SENIOR MANAGERS OF THE PAYSAFE GROUP

Name Position

Dennis Jones Non-Executive Chairman Joel Leonoff President and Chief Executive Ofﬁcer Brian McArthur-Muscroft Chief Financial Ofﬁcer Andrew Dark Non-Executive Director Ian Francis Non-Executive Director Brahm Gelfand Non-Executive Director Ian Jenks Non-Executive Director The business address of each of the Directors is Audax House, 6 Finch Road, Douglas, IM1 2PT, Isle of Man.

1.1 Proﬁles of the Directors of Paysafe The names, business experience and principal business activities outside the Paysafe Group of the Directors are set out below:

Joel Leonoff, President and Chief Executive Officer (age 52) Joel Leonoff was appointed to the Board in February 2011, and was appointed as President and Chief Executive Officer on 31 July 2011. Mr Leonoff has served as chief executive officer, chief operating officer and chief financial officer of private and publicly traded companies. Mr Leonoff created the e-commerce business BCE Emergis through the merger of Mpact Immedia Limited with Bell Canada Enterprises. He later founded SureFire Commerce Inc. (renamed Terra Payments), a Canadian TSE-listed payments company in 1998, where he served as Chief Operating Officer and Chief Financial Officer. Surefire Commerce Inc. later merged with the Paysafe Group to form Optimal Payments Inc., a NASDAQ listed online payments company. Mr Leonoff has also previously served as Group Operations Director/ Chief Operating Officer of Partygaming plc (now called bwinparty plc), a FTSE 100 Company, regarded as one of the leading online gambling companies in the world. In addition to any directorships of Paysafe Group companies, Mr Leonoff is or has been within the past five years, a member of the following supervisory or management boards and is or has been a member of the following partnerships:

Company / Partnership Position Still held

OPC Payments Inc. Director No Card One Plus Limited Director No Brian McArthur-Muscroft, Chief Financial Officer (age 52) Brian McArthur-Muscroft was appointed to the Board on 1 January 2015. Mr McArthur- Muscroft was previously Group Finance Director at Telecity Group plc where he led the company’s initial public offering in 2007 and was involved in raising £400 million in senior debt facilities with major UK institutions to support the rapid growth of the business. Mr McArthur-Muscroft currently serves as a non-executive director on the board of Robert Walters plc, and he previously served as chief financial officer at Viatel, Eckoh Technologies plc and Cable & Wireless HKT Multimedia. He is also a restructuring specialist and previously served as interim chief financial officer at MCI Worldcom EMEA. He qualified as a Chartered Accountant with PricewaterhouseCoopers in London, specialising in business restructuring and turnaround assignments and he holds a Bachelor of Laws degree. Mr McArthur-Muscroft is also a trustee of Touraid, an international rugby charity. In addition to any directorships of Paysafe Group companies, he is or has been within the past five years, a member of the following supervisory or management boards and is or has been a member of the following partnerships:

285 Company / Partnership Position Still held

Robert Walters plc Director Yes Telecity Group plc Director No Globix Holdings (UK) Limited Director No Globix Limited Director No GLX Leasing Limited Director No Telecity Limited Director No Telecity UK Limited Director No TelecityGroup Holdings Limited Director No TelecityGroup International Limited Director No TelecityGroup UK Limited Director No TelecityGroup Investments Limited Director No Internet Facilitators Holdings Limited Director No Internet Facilitators Limited Director No Newincco 992 Limited Director No Central Data Centres Limited Director No The UK Grid Network Limited Director No UK Grid Group Limited Director No Data Electronics Group Limited Director No TelecityGroup Ireland Limited (formerly Data Electronics Services Limited) Director No Telecity (Ireland) Limited (formerly TelecityGroup Ireland Limited) Director No TelecityGroup France SA Director No TelecityGroup Italia SpA Director No TelecityGroup Italia Srl. Director No TelecityGroup Netherlands BV Director No TelecityGroup Europe (1) Coo¨peratief W.A Director No TelecityGroup Europe (2) B.V Director No TelecityGroup Scandinavia AB Director No TelecityGroup Finland Oy Director No TelecityGroup Spain SA Director No TelecityGroup Germany GmbH Director No TelecityGroup Poland Sp. z o.o. (formerly PLIX) Director No SadeceHosting Director No 3DC EAD (now called TelecityGroup Bulgaria EAD) Director No Dennis Jones, Non-Executive Chairman (age 66) Dennis Jones joined the Board on 31 July 2014 as Non-Executive Chairman. He has had close to 30 years’ experience in payments and payment processing and has held executive roles in the UK, mainland Europe, China and the US where he was a Director, President and Chief Executive Ofﬁcer of RBS National Bank. Mr Jones is also currently the Non-Executive Chairman of Paysafe Financial Services Limited, a wholly owned subsidiary of the Company, having previously been a director of Paysafe Financial Services Limited until September 2011. Until 2012, he was a Non-Executive Director of Argus Information Services Inc. (a US provider of data analytics to payment providers across the US, Latin America and the UK) and a Non-Executive Director of Kroger Personal Finance LLC, the ﬁnancial services arm of the KrogerCorporation, the second largest US retailer. Mr Jones is a member of the Institution of Engineering and Technology.

In addition to any directorships of Paysafe Group companies, Mr Jones is or has been within the past ﬁve years, a member of the following supervisory or management boards and is or has been a member of the following partnerships:

Company / Partnership Position Still held

TSYS Managed Services EMEA Limited Director Yes Farnham Place Management Limited Director Yes Argus Information Services Inc. Director No

286 Company / Partnership Position Still held

Kroger Personal Finance LLC Director No RBS National Bank Director No Andrew Dark, Non-Executive Director (age 52) Andrew Dark joined the Board on 31 July 2014 as Non-Executive Director. Mr Dark is Chief Executive Officer and a Director of Displaydata Limited and also Chairman of Miura Systems Limited and Mappt Limited, a Director of New Era Digital Limited and a Non-Executive Director of Wildark Risk Management Limited. He was formerly Chief Executive Officer and Director of online payments company Datacash Group plc during its period of rapid growth (subsequently sold to MasterCard) and the former Chief Executive Officer and Director of mBlox Limited which facilitates communication between businesses and customers’ mobile devices and a Director of payments company Dione plc.

In addition to any directorships of Paysafe Group companies, Mr Dark is or has been within the past ﬁve years, a member of the following supervisory or management boards and is or has been a member of the following partnerships:

Company / Partnership Position Still held

Displaydata Limited Director Yes Miura Systems Ltd Director Yes Mappt Limited Director Yes New Era Digital Limited Director Yes Wildark Risk Management Limited Director Yes Asenna Ltd. Director Yes ZBD Displays Limited Director Yes ZBD Displays SAS Director Yes Displaydata Inc. Director Yes mBlox UK Limited Director No mBlox Limited Director No mBlox Inc. Director No Wildark Limited Director No ZBD Solutions GmbH Director No The Grange Residents Management Company Limited Director No Ian Francis, Non-Executive Director (age 57) Ian Francis was appointed to the Board on 1 September 2010. Mr Francis was most recently a senior audit partner and member in the London practice of Ernst & Young where he was responsible for a number of the ﬁrm’s leading audit clients. He was also a non-executive director of Umeme Limited, the privatised national power distribution company of Uganda from September 2009 to November 2014. Ian is chairman of the Company’s audit committee.

In addition to any directorships of Paysafe Group companies, Mr Francis is or has been within the past ﬁve years, a member of the following supervisory or management boards and is or has been a member of the following partnerships:

Company / Partnership Position Still held

Umeme Limited Director No Brahm Gelfand, Non-Executive Director (age 78) Brahm Gelfand was appointed to the Board on 13 March 2014. Mr Gelfand is an attorney practising law in Montreal, Canada. He is presently counsel to the law ﬁrm of Lapointe Rosenstein Marchand Melanc¸on L.L.P. where he had served as a partner for many years prior to becoming counsel.

Mr Gelfand retired as of 1 June 2015 as chairman and director of Dundee 360 Real Estate Corporation, an international realty development, sales and marketing entity and is currently a director of Tefron Ltd, a leading Israeli producer of seamless textile apparel and of Dundee Sustainable Technologies Inc. . He is also a member of the Independent Review Committee

287 of 1832 Asset Management L.P., an indirect wholly-owned subsidiary of the Bank of Nova Scotia and is chairman of the Independent Review Committee of Goodman Investment Counsel, a wholly-owned subsidiary of Dundee Corporation. Mr Gelfand was until 30 April 2015 and the reform instituted by the Minister of Health of the Province of Quebec , abolishing the boards of directors of healthcare institutions a director of the Douglas Mental Health University Institute of Montreal and of the Sir Mortimer B. Davis – Jewish General Hospital where he served as chair for two terms. He is also a founding director of the Summit School Foundation and the Roasters Foundation. In addition to any directorships of Paysafe Group companies, Mr Gelfand is or has been within the past ﬁve years, a member of the following supervisory or management boards and is or has been a member of the following partnerships:

Company / Partnership Position Still held

89737 Canada Lte´e Director Yes Dundee Sustainable Technologies Inc. Director Yes IFP Technologies (Canada) Inc. Director Yes Les Ressources Malmaison Inc. Director Yes Lian & Danny Taran Foundation Director Yes Recherches Devatech Inc. Director Yes Roasters Foundation Director Yes Summit School Foundation Director Yes Tecnica Group Canada Inc. Director Yes Tecnica Group USA Corp. Director Yes Tefron Ltd Director Yes Volt Canada Inc. Director Yes Volt Consulting MSP Canada Ltd Director Yes Douglas Mental Health Institute University Director No Dundee 360 Real Estate Corporation (formerly Vox 360Corporation) Director No Sir Mortimer B. Davis – Jewish General Hospital Director No Stedfast Inc. Director No Ian Jenks, Non-Executive Director (age 61) Ian Jenks joined the Board on 31 July 2014 and he is the Senior Independent Director of Paysafe Group plc. He has over 30 years’ experience of growing leading edge technology businesses in the USA and Europe. He is currently a board director of publicly listed Birdstep Technology and venture backed companies Econic Technologies, Nexeon, Seren and Smartkem. Earlier in his career, he was President – Lasers and Fibre Optics at JDS Uniphase Inc. (JDSU), Chairman of Oplink Communications Inc. (OPLK), Executive Chairman of Evo Electric, Chairman of Quantasol and a Partner in Crescendo Ventures LLP. Ian has a degree in Aeronautical Engineering from the University of Bristol. Mr Jenks is also an associate member of the Institution of Mechanical Engineers. In addition to any directorships of Paysafe Group companies, Mr Jenks is or has been within the past ﬁve years, a member of the following supervisory or management boards and is or has been a member of the following partnerships:

Company / Partnership Position Still held

Ian Jenks Limited Director Yes Birdstep Technologies ASA Director Yes Seren Photonics Limited Director Yes Econic Limited Director Yes Nexeon Limited Director Yes Smartkem Limited Director Yes Transmode AB Director No Intune Networks Limited (in Receivership) Chairman No British Photovoltaic Association Director No Quantasol Limited Chairman No Evo Electric Limited Chairman No

288 1.2 Save as set out below, none of the Directors have: * been convicted in relation to a fraudulent offence during the period of five years preceding the date of this document; * any unspent convictions in relation to indictable offences; * any bankruptcy order made against him or entered into any voluntary arrangements; * been associated with any bankruptcy, receivership, liquidation while acting in the capacity of a member of the administrative, management or supervisory body or of senior manager of any company during the period of five years preceding the date of this document; * been subject to any official public incrimination and/or sanction by statutory or regulatory authorities (including designated professional bodies); * been disqualified by a court from acting as a member of the administrative, management or supervisory bodies of any issuer or from acting in the management or conduct of the affairs of any issuer; * been a director of a company which has been placed in receivership, compulsory liquidation, creditors’ voluntary liquidation, administration, been subject to a company voluntary arrangement or any composition or arrangement with its creditors generally or any class of its creditors whilst he was a director of that company or within the 12 months after he ceased to be a director of that company; * been a partner in any partnership which has been placed in compulsory liquidation, administration or been the subject of a partnership voluntary arrangement whilst he was a partner in that partnership or within the 12 months after he ceased to be a partner in that partnership; or * been the owner of any assets or a partner in any partnership which has been placed in receivership whilst he was a partner in that partnership or within the 12 months after he ceased to be a partner in that partnership. Mr Jenks was formerly a director of Intune Networks Limited which was placed into receivership in December 2013. Mr McArthur-Muscroft was formerly a director of Telecity Finance Limited, Telecity Holdings Limited and Telecity Investments Limited, each of which were placed into a members’ voluntary liquidation as part of a group reorganisation in 2009.

1.3 Conflict of interest There are no actual or potential conflicts of interests between the duties any Director has to the Company and the private interests and/or other duties they may also have. Save as disclosed in this Part IX, there are no interests that are material to the Admission. No Director has a material interest in any significant contract with the Company or any of its subsidiaries. No director was selected to be a director of the Company pursuant to any arrangement or understanding with any major customer, supplier or other person having a business connection with the Paysafe Group. No restrictions have been agreed by any Director on the disposal within a certain period of time of his holding in the Company. There are no family relationships between any of the Directors or the Senior Management.

1.4 Proﬁles of the Senior Managers of the Paysafe Group The names, business experience and principal business activities outside the Paysafe Group of the Senior Management of the Paysafe Group are set out below:

Danny Chazonoff, Chief Operating Officer (age 52) Danny Chazonoff has been the Chief Operating Officer of Paysafe since 31 July 2011. Prior to this, he held the position of chief technical officer at the Montreal based group comprising OP Payments Inc and its related companies (‘‘OP Payments’’) and was employed by the group since it was founded in 1996. Mr Chazonoff provides leadership, management and

289 direction in the areas of bank and partner relationships, product direction, technology and risk and operations. Prior to joining OP Payments, Mr Chazonoff served as vice president, MIS and Web Development at BCE Emergis, a subsidiary of Bell Canada, and as director of operations for AVS Technologies, a leading distributor of consumer electronics in Canada. Mr Chazonoff brings a wealth of international payments expertise and IT experience to the Paysafe Group. Mr Chazonoff holds a Bachelor of Commerce with a Major in Management Information Systems from McGill University and an MBA from the John Molson School of Business in Montreal. In addition to any directorships of Paysafe Group companies, Mr Chazonoff is or has been within the past ﬁve years, a member of the following supervisory or management boards and is or has been a member of the following partnerships:

Company / Partnership Position Still held

Chazanoff Family Trust Trustee Yes Chazlo Enterprises, Inc Director Yes Elliott Wiseman, General Counsel and Chief Compliance Officer (age 41) Elliott Wiseman joined Paysafe in October 2011 and is responsible for the Paysafe Group’s legal and compliance matters. Mr Wiseman qualified as a solicitor in May 2001 and has over 13 years’ of experience providing corporate, commercial and regulatory advice to large corporate entities within the financial services and other industries. Mr Wiseman leads a team of sixteen lawyers and legal professionals and nineteen compliance professionals across the jurisdictions in which Paysafe operates. Prior to joining Paysafe, Mr Wiseman worked at various international law firms, acted as senior legal counsel at MoneyGram International and worked as an analyst at Praxient Capital LLP. Mr Wiseman holds a Bachelor of Arts in Geography and has completed a Graduate Diploma in Law (previously the Common Professional Examination) and a post-graduate Legal Practice Course. In addition to any directorships of Paysafe Group companies, Mr Wiseman is or has been within the past five years, a member of the following supervisory or management boards and is or has been a member of the following partnerships:

Company / Partnership Position Still held

Lane Properties Ltd Director Yes MoneyGram International Holdings Limited Director No MIL Overseas Limited Director No 1.5 None of the Senior Managers of the Paysafe Group have: * been convicted in relation to a fraudulent offence during the period of five years preceding the date of this document; * any unspent convictions in relation to indictable offences; * any bankruptcy order made against him or entered into any voluntary arrangements; * been associated with any bankruptcy, receivership, liquidation while acting in the capacity of a member of the administrative, management or supervisory body or of senior manager of any company during the period of five years preceding the date of this document; * been subject to any official public incrimination and/or sanction by statutory or regulatory authorities (including designated professional bodies); * been disqualified by a court from acting as a member of the administrative, management or supervisory bodies of any issuer or from acting in the management or conduct of the affairs of any issuer;

290 * been a director of a company which has been placed in receivership, compulsory liquidation, creditors’ voluntary liquidation, administration, been subject to a company voluntary arrangement or any composition or arrangement with its creditors generally or any class of its creditors whilst he was a director of that company or within the 12 months after he ceased to be a director of that company; * been a partner in any partnership which has been placed in compulsory liquidation, administration or been the subject of a partnership voluntary arrangement whilst he was a partner in that partnership or within the 12 months after he ceased to be a partner in that partnership; or * been the owner of any assets or a partner in any partnership which has been placed in receivership whilst he was a partner in that partnership or within the 12 months after he ceased to be a partner in that partnership.

2. CORPORATE GOVERNANCE The roles of the chairman and chief executive on the Board are, and it is intended that they will continue to be, separate. The Board is responsible for the strategy, effective control and management of the Paysafe Group. There is a formal schedule of matters specifically reserved for Board approval, which includes approval of the annual and interim accounts, the approval of authority levels below the Board and material acquisitions, disposals and financing arrangements. The Board delegates authority to the executive committee of the Board, which consists of the Executive Directors, in respect of operational decisions and certain transactions within defined, limited parameters. The Board has a regular schedule of meetings together with further meetings as required by the ongoing business of the Company. As a company which will be listed on the Main Market, Paysafe will be subject to stricter regulation and compliance, including being required to adhere to the UK Corporate Governance Code. The Board has reviewed its governance standards in the months preceding the transfer to the Main Market and believes the Company generally meets and achieves most standards of best practice and UK Corporate Governance Code requirements. The Board recognises this is an incremental process and it intends to continue to address the remaining corporate governance requirements of the UK Corporate Governance Code. The Board has established Audit, Remuneration and Nomination Committees which operate within defined terms of reference, and their minutes are circulated to the Board. The Board has revised the terms of reference for each of the Audit, Remuneration and Nomination Committees in order to reflect the Corporate Governance Code and the best practice for FTSE 250 companies. The new terms of reference will take effect upon Admission and will be made available on the Company’s website (www.paysafe.com). The Audit Committee is chaired by Ian Francis. The other members are Andrew Dark and Brahm Gelfand. The terms of reference of the Audit Committee state that it shall meet as many times as its roles and responsibilities require, and not less than three times a year. The Audit Committee’s responsibilities include: (a) monitoring the integrity of the financial statements of the Company and any formal announcements relating to the Company’s financial performance; (b) reviewing the Company’s internal financial controls and the Company’s internal control and audit functions and risk management systems; (c) making recommendations to the Board in relation to the appointment of the external auditor and approving the remuneration and terms of engagement of the external auditor; (d) reviewing and monitoring the external auditor’s independence, objectivity and effectiveness; and (e) developing and implementing policy on the engagement of the external auditor to supply non-audit services, taking into account relevant ethical guidance. The Remuneration Committee is chaired by Ian Jenks. The other members are Andrew Dark and Brahm Gelfand. The terms of reference of the Remuneration Committee require the Committee to meet at least three times a year. Its responsibilities include:

291 (a) determining the remuneration policy of the executive directors and senior management; (b) determining the Company’s policy on the duration of contracts with executive directors and other terms including notice and termination payments; (c) determining the total individual remuneration packages of the chairman of the Board, each executive director, the company secretary and senior management, including bonuses, incentive payments, share awards and pension arrangements, within the terms an agreed framework; and (d) administering and reviewing all aspects of any share option scheme operated by or to be established by the Company. The Nomination Committee is chaired by Andrew Dark. The other members are Dennis Jones and Ian Francis. The terms of reference of the Nomination Committee state that it is responsible for all aspects of the appointment of directors to the Company. The Nomination Committee is required to meet at least twice a year. Its responsibilities include: (a) reviewing the structure, size and composition of the Board and its committees; (b) identifying and nominating candidates to fill board vacancies as and when they arise; (c) making recommendations to the Board regarding its policy on boardroom diversity, and reviewing progress made in achieving any objectives set out in the policy; and (d) considering recommendations to the Board of directors retiring by rotation for re-election by Shareholders. The Company has also established an executive Risk Management Committee. Further information about the roles and responsibilities of each the Risk Management Committee can be found on page 468 of the March 2015 Prospectus and is incorporated by reference into this document. Upon Admission, the Company intends to comply with a code of securities dealings (the ‘‘Share Dealing Code’’) in relation to the Ordinary Shares which is based on, and is at least as rigorous as, the Model Code as published in the Listing Rules. The Share Dealing Code will apply to the Directors, Senior Management and other relevant employees of the Paysafe Group. The Remuneration Committee has undertaken a review of the Company’s remuneration policy for executive directors and senior managers (the ‘‘Remuneration Policy’’) in order to reflect the Company’s move to the Main Market and the proposed inclusion in the FTSE 250 index, including the requirements of the Corporate Governance Code and the best practice for listed companies in the UK. The Company obtained independent advice from FIT Remuneration Consultants LLP whilst conducting this review. The Company will set out full details of its Remuneration Policy in the Directors’ Remuneration Report for 2015, which will form part of the 2015 Annual Report and Accounts. The Company intends to seek approval from its Shareholders for the Remuneration Policy and the Directors’ Remuneration Report for 2015 at the Company’s annual general meeting in 2016, with the intention for the Remuneration Policy to apply for three years from the date of the 2016 annual general meeting. On 29 June 2015, the Company made awards under the Paysafe Long Term Incentive Plan to the Executive Directors and the Senior Managers, in anticipation of the adoption of the Remuneration Policy by the Company. The awards granted to the Executive Directors and the Senior Managers were conditional upon Completion, which has now occurred. These awards are considered by the Remuneration Committee to represent the first awards under the new Remuneration Policy, and accordingly are subject to a three year vesting period and to demanding three year performance targets which are based on relative Total Shareholder Return (‘‘TSR’’) performance (measured against the constituents of the FTSE 250 (excluding investment trusts)) for 50 per cent. of the awards and challenging Earnings per Share (‘‘EPS’’) growth targets for the remaining 50 per cent. of the awards. Both TSR and EPS will be measured over the three financial years to 31 December 2017. The review of Remuneration Policy also recommended an increase in the fees of the Chairman.

292 3. EMPLOYEES 3.1 Paysafe The total number of persons employed by the Paysafe Group as at the end of the six months ended 30 June 2015 and the end of the three ﬁnancial years ended 31 December 2012, 31 December 2013 and 31 December 2014 is set out below: Number of Employees

Six months ended Year ended Year ended Year ended 30 June 31December 31December 31December 2015 2014 2013 2012

Total number of employees 724 712 516 387

In January 2015, the Paysafe Group initiated a redundancy programme, focused on the Paysafe Group’s STP business, with the aim of streamlining the Paysafe Group’s STP business and reducing employment costs by over US$3.8 million per year. The Paysafe Group made 25 employees redundant in January 2015. Since April 2015, 176 employees from Montreal, Cambridge, London, Sweden, Hong Kong, Germany and Bulgaria have left the Paysafe Group, including employees who left the Paysafe Group after the completion of the Skrill Acquistion. The Paysafe Group expects that an additional 92 employees will be made redundant during Q4 2015 in connection with the completion of the Skrill Acquisition and the continued integration of Ukash and paysafecard. The Paysafe Group has also initiated a redundancy programme in Calgary, Canada, in order to allow the Paysafe Group to consolidate activities carried out by the Paysafe Group’s payment delivery centre in Soﬁa, Bulgaria. See paragraph 9 of Part I (Information on the Paysafe Group) of this document for further information regarding the Paysafe Group’s redundancy programme. As at the Latest Practicable Date, the Paysafe Group employed approximately 1600 persons (including the Directors).

3.2 Skrill The total number of persons employed by the Skrill Group as at the end of the six months ended 30 June 2015 and the end of the three ﬁnancial years ended 31 December 2012, 31 December 2013 and 31 December 2014 is set out below: Number of Employees

Six months ended Year ended Year ended Year ended 30 June 31December 31December 31December 2015 2014 2013 2012

Total number of employees 868 722 735 568

Following completion of the Ukash Acquisition, the Skrill Group initiated a redundancy programme, connected to the integration of Ukash within the Skrill Group. In June 2015, the Skrill Group made 12 employees redundant. Following the completion of the Ukash Acquisition on 31 March 2015, 85 employees have been made redundant from the Skrill Group. See paragraph 9 of Part I (Information on the Paysafe Group) of this document for further information regarding the Paysafe Group’s redundancy programme.

293 PART X

TAXATION

1. UNITED KINGDOM TAXATION The following statements are intended only as a general guide to certain UK tax considerations and do not purport to be a complete analysis of all potential UK tax consequences of acquiring, holding or disposing of Ordinary Shares. They are based on current UK legislation and what is understood to be the current practice of HMRC as at the Latest Practicable Date, both of which may change, possibly with retrospective effect. They relate only to certain limited aspects of the UK tax treatment of Ordinary Shareholders who are resident and domiciled for tax purposes in and only in the UK (except insofar as express reference is made to the treatment of non-UK residents), who hold their Ordinary Shares as an investment (other than in a new individual savings account or self-invested pension plans) and who are the absolute beneﬁcial owners of both the Ordinary Shares and any dividends paid on them. The tax position of certain categories of Ordinary Shareholders who are subject to special rules (such as persons acquiring their Ordinary Shares in connection with employment, dealers in securities, insurance companies and collective investment schemes) is not considered. The statements summarise the current position and are intended as a general guide only. Prospective investors who are in any doubt as to their tax position or who may be subject to tax in a jurisdiction other than the UK are strongly recommended to consult their own professional advisors.

1.1 Taxation of dividends Under current UK tax law, the Company will not be required to withhold tax at source from dividend payments it may make. An Ordinary Shareholder’s liability to tax on dividends will depend upon the individual circumstances of the Ordinary Shareholder.

(a) Individuals An individual Ordinary Shareholder who is resident for tax purposes in the UK, whose shareholding does not exceed 10 per cent. of the Company’s total issued share capital and who receives a dividend from the Company will generally be entitled to a tax credit which may be set off against his or her total income tax liability on the dividend. An individual Ordinary Shareholder’s liability to income tax is calculated on the aggregate of the dividend and the tax credit (the ‘‘Gross Dividend’’) which will generally be regarded as the top slice of the individual’s income. The tax credit will be equal to 10 per cent. of the Gross Dividend, i.e. the tax credit will be one-ninth of the amount of the cash dividend received. A UK resident individual Ordinary Shareholder who is liable to income tax at a rate or rates not exceeding the basic rate will be subject to income tax on the dividend at the rate of 10 per cent of the Gross Dividend, so that the tax credit will satisfy in full such Ordinary Shareholder’s liability to income tax on the dividend. A UK resident individual Ordinary Shareholder who is liable to income tax at the higher rate will be subject to income tax on the Gross Dividend at the rate of 32.5 per cent. but will be able to set the tax credit off against part of this liability. The effect of the set-off of the tax credit is that such an Ordinary Shareholder will have to account for additional income tax of 22.5 per cent of the Gross Dividend (which equates to 25 per cent of the net cash dividend received) to the extent that the Gross Dividend, when treated as the top slice of his or her income, falls above the threshold for higher rate income tax, but below the threshold for additional rate income tax. A UK resident individual Shareholder who is liable to income tax at the additional rate will be subject to income tax on the Gross Dividend at the rate of 37.5 per cent. but will be able to set the tax credit off against part of this liability. The effect of the set-off of the tax credit is that such an Ordinary Shareholder will have to account for additional income tax of 27.5 per cent of the Gross Dividend (which equates to approximately

294 30.6 per cent of the net cash dividend received) to the extent that the Gross Dividend, when treated as the top slice of his or her income, falls above the threshold for additional rate income tax. Where the tax credit exceeds the Ordinary Shareholder’s tax liability the Ordinary Shareholder cannot claim repayment of the tax credit from HMRC. From 6 April 2016, it is expected that the 10 per cent. dividend tax credit will be abolished and that instead, all UK individual taxpayers will be taxed based on the gross dividend in excess of a ﬂat £5,000 per annum.

(b) Companies Dividends paid on the Ordinary Shares to corporate Ordinary Shareholders within the charge of UK corporation tax will be subject to corporation tax. However, generally, (subject to anti-avoidance rules) dividends paid to UK resident companies that are not ‘‘small’’ companies (as deﬁned in section 931S Corporation Tax Act 2009) will fall within one of the exemptions from corporation tax on dividends. Ordinary Shareholders within the charge to corporation tax are advised to consult their own professional advisers to establish whether they qualify for one of the exemptions.

(c) Tax exempt Ordinary Shareholders Other UK resident Ordinary Shareholders who are not liable to UK tax on dividends, including pension schemes and charities, will not be entitled to any payment from HMRC in respect of the tax credit attaching to any dividend paid by the Company.

(d) Non-residents Ordinary Shareholders resident outside the UK for tax purposes will not generally be entitled to any payment from HMRC in respect of the tax credit attaching to any dividend paid by the Company. An Ordinary Shareholder resident outside the UK may also be subject to foreign taxation on dividend income under the law of the relevant foreign jurisdiction, and should consult his, her or its own tax advisor regarding his, her or its tax liabilities on dividends received from the Company.

1.2 Taxation of chargeable gains An Ordinary Shareholder’s liability to tax on chargeable gains will depend upon the individual circumstances of the Ordinary Shareholder.

(a) Individuals If a UK resident individual Ordinary Shareholder sells or otherwise disposes of all or some of the Ordinary Shares, he or she may, depending on his or her circumstances and subject to any available exemption or relief, incur a liability to CGT. An individual Ordinary Shareholder has an annual exemption (£11,100 for the tax year ending 5 April 2016) and so will only be subject to CGT to the extent his or her total chargeable gains in the year (including any gains on the disposal or deemed disposal of his or her Ordinary Shares) exceed this annual exemption. The rate of CGT will depend on the individual Ordinary Shareholder’s total taxable income and gains in the relevant tax year. An individual Shareholder whose total taxable income and gains in the tax year (including gains on a disposal or deemed disposal of Ordinary Shares) are more than the individual’s basic rate band will generally be subject to CGT at 28 per cent. on the gain on the disposal or deemed disposal of the New Ordinary Shares (save for any part of the gain which, when aggregated with his or her other taxable income and gains during the tax year, is less than or equal to the individual’s basic rate band). An individual Shareholder whose total taxable income and gains in a given tax year (including gains on a disposal or deemed disposal of New Ordinary Shares) are less than or equal to the individual’s basic rate band will generally be subject to CGT at 18 per cent. of the gain on the disposal or deemed disposal of the New Ordinary Shares.

295 (b) Companies An Ordinary Shareholder within the charge to UK corporation tax that sells or otherwise disposes of all or some of the Ordinary Shares may, depending on its circumstances and subject to any available exemption or relief, incur a liability to corporation tax on chargeable gains. Chargeable gains realised by Ordinary Shareholders within the charge to UK corporation tax will be subject to corporation tax at the rate of corporation tax applicable to the company making the disposal or deemed disposal. Such an Ordinary Shareholder will be entitled to an indexation allowance which may reduce the chargeable gain.

(c) Non-residents An Ordinary Shareholder who is not resident for tax purposes in the UK will not generally be subject to CGT on the disposal or deemed disposal of Ordinary Shares unless the Ordinary Shareholder is carrying on a trade, profession or vocation in the UK through a branch or agency (or, in the case of a corporate Ordinary Shareholder, a permanent establishment) in connection with which the Ordinary Shares are used, held or acquired. Such Ordinary Shareholders may be subject to foreign taxation on any gain under local law. An individual Ordinary Shareholder who ceases to be resident solely in the UK for tax purposes for a period of less than ﬁve years and who disposes of all or part of his or her Ordinary Shares during that period may be liable to CGT on his or her return to the UK subject to any available exemptions or reliefs.

1.3 Stamp duty and stamp duty reserve tax (‘‘SDRT’’) The following comments are intended as a guide to the general stamp duty and SDRT position and do not relate to persons such as market makers, brokers, dealers, intermediaries and persons connected with depository arrangements or clearance services, to whom special rules apply. No UK stamp duty or SDRT will be payable on the issue of definitive share certificates representing Ordinary Shares or on the crediting of Ordinary Shares to stock accounts in CREST. UK stamp duty (at the rate of 0.5 per cent of the amount of the value of the consideration for the transfer rounded up where necessary to the nearest £5) is in principle payable on any instrument of transfer of the Ordinary Shares executed within the UK other than when the value of the consideration for the transfer is less than £1,000 (and does not form part of a larger transaction or series of transactions for which the aggregate consideration exceeds £1,000). There may, however, be no practical necessity to pay such stamp duty as United Kingdom stamp duty is not an assessable tax. However, an instrument of transfer which is not duly stamped cannot be used for certain official purposes in the UK; for example it will be inadmissible in evidence in civil proceedings in a UK court. No SDRT will be payable in respect of any agreement to transfer the Ordinary Shares, provided that the Ordinary Shares are not registered in a register kept in the UK by or on behalf of the Company, and that the Ordinary Shares are not paired with shares issued by a company incorporated in the UK.

1.4 Anti-avoidance provisions (a) Offshore funds rules The Company should not qualify as an ‘‘offshore fund’’ for the purposes of UK tax legislation for offshore funds. In general, a company is not an offshore fund if a reasonable investor cannot expect to be able to realise all or part of their investment on a basis calculated by reference to net asset value except on a winding-up of the Company (and there is no ﬁxed date for such winding-up). As this is the case, the Company should not constitute an ‘‘offshore fund’’. However, it is possible that HM

296 Revenue & Customs may take a different view and determine that the Company is an ‘‘offshore fund’’. In this case, UK resident investors may be required to treat gains realised on a disposal of shares as income rather than capital gain for UK tax purposes.

(b) Section 13 Taxation of Chargeable Gains Act 1992 The attention of Ordinary Shareholders who are resident in the UK is drawn to section 13 of the Taxation of Chargeable Gains Act 1992 (‘‘TCGA’’). If the Company is controlled by a sufﬁciently small number of persons such that were it resident in the UK for tax purposes it would be a ‘‘close’’ company, the provisions of section 13 TCGA may in certain circumstances have the effect of subjecting such an Ordinary Shareholder to UK capital gains tax or corporation tax on chargeable gains on the proportion of any capital gain accruing to the Company that corresponds to that Ordinary Shareholder’s proportionate interest in the Company. No liability under section 13 TCGA could be incurred by such an Ordinary Shareholder, however, where such proportion accruing to that Ordinary Shareholder together with any connected persons does not exceed one- quarter of the gain.

(c) Controlled foreign company rules The attention of Ordinary Shareholders who are companies resident in the UK is drawn to the fact that the ‘‘controlled foreign companies’’ legislation contained in Part 9A of the Taxation (International and Other Provisions) Act 2010 (‘‘TIOPA’’) could apply to any company so resident that is deemed to be interested, either alone or together with certain other connected or associated persons, in 25 per cent or more of the chargeable profits of the Company arising in any accounting period, if at the same time the Company is controlled (within the meaning of Chapter 18 of Part 9A TIOPA) by companies or other persons who are resident in the UK for tax purposes. The chargeable profits of the Company for these purposes would not include any of its chargeable gains. The effect of such provisions could be to render such Ordinary Shareholders liable to UK corporation tax in respect of their share of undistributed chargeable profits of the Company. However, this will apply only if the apportionment to the Ordinary Shareholder, when aggregated with the apportionment to any connected or associated persons, is at least 25 per cent of the chargeable profits of the Company.

(d) Transfer of assets abroad rules The attention of Ordinary Shareholders who are individuals resident in the UK is drawn to the provisions of Chapter 2 of Part 13 of the Income Tax Act 2007. This Chapter contains anti-avoidance provisions dealing with the transfer of assets resulting in income becoming payable to persons (including companies) resident or domiciled outside the UK and may render such Ordinary Shareholders liable to taxation in respect of undistributed income and proﬁts of the Company.

2. ISLE OF MAN TAXATION The statements set out below are intended only as a general guide to current aspects of Isle of Man taxation. The summary does not purport to be an exhaustive analysis of all potential Isle of Man tax issues. If you are in any doubt as to your tax position or if you may be subject to tax in any other jurisdiction, you are strongly recommended to consult an appropriate professional adviser.

2.1 Tax resident in the Isle of Man The Company is resident for taxation purposes in the Isle of Man by virtue of being incorporated in the Isle of Man.

2.2 Capital taxes in the Isle of Man The Isle of Man has a regime for the taxation of income, but there are no capital gains taxes, stamp taxes or inheritance taxes in the Isle of Man. No Isle of Man stamp duty or stamp duty reserve tax will be payable on the issue or transfer of, or any other dealing in the Ordinary Shares.

297 2.3 Zero Rate of Corporate Income Tax in the Isle of Man The standard rate of corporate income tax in the Isle of Man is 0 per cent. (zero per cent.). However, a higher rate of tax applies to income received by a company from any of the following sources: (a) banking business and certain retail proﬁts (10 per cent. rate); and (b) land and property in the Isle of Man (including property development, residential and commercial rental or property letting and mining & quarrying) (20 per cent. rate). As it does not receive income from these sources, the Company is liable to income tax at a ‘‘zero’’ per cent. rate on its proﬁts. The Company is not required to withhold tax from the payment of dividends to Shareholders, wherever resident.

2.4 EU Savings Directive Directive 2003/48/EU of the European Union on the taxation of savings income seeks to bring about the effective taxation of interest payments in a beneﬁcial owner’s member state of tax residence through the automatic exchange of information on cross border interest payments to individual beneﬁcial owners. The Isle of Man has entered into agreements with all the Member States to apply automatic exchange of information. These measures now apply in the Isle of Man, but the Directive does not currently extend to dividend payments.

2.5 Management and control of the Company It is the intention of the Directors to conduct the affairs of the Company so that the management and control of the Company is not exercised elsewhere other than the Isle of Man and the Company is not resident in the UK or elsewhere for taxation purposes and so that it does not carry on any trade in the UK or elsewhere (whether or not through a permanent establishment situated there). Accordingly, the Company should not be liable for taxation by the UK or any other jurisdiction on its proﬁts or gains, other than taxation sourced on certain income deriving from sources within that jurisdiction.

2.6 Isle of Man probate In the event of the death of a sole holder of Ordinary Shares an Isle of Man grant of probate or administration may be required, in respect of which certain fees will be payable to the Isle of Man government.

298 PART XI

ADDITIONAL INFORMATION

1. PERSONS RESPONSIBLE The Company and the Directors whose names appear on page 47, accept responsibility for information contained in this document. To the best of the knowledge of the Company and the Directors (who have taken all reasonable care to ensure that such is the case), the information contained in this document is in accordance with the facts and contains no omission likely to affect its import.

2. COMPANY DETAILS 2.1 The Company was incorporated and registered in the Isle of Man on 31 October 2003 under the Isle of Man Companies Acts 1931 to 1993 with registered number 109535C as a private company limited by shares with the name NETeller Limited. The liability of the members of the Company is limited. On 1 April 2004 the Company re-registered as a public limited company with the name NETeller plc. On 13 November 2008, the Company changed its name to NEOVIA Financial plc. On 28 February 2011 the Company changed its name to Optimal Payments plc. On 9 November 2015, the Company changed its name to Paysafe Group plc. 2.2 The Company’s registered ofﬁce is at Audax House, 6 Finch Road, Douglas, IM1 2PT, Isle of Man. The telephone number of the Company’s registered ofﬁce is +44 (0)1624 698700.

3. SHARE CAPITAL The issued and fully paid share capital of the Company as at the close of business on the Latest Practicable Date consists of:

Nominal value Number of of shares Class of share capital shares issued issued

Ordinary Shares of £0.0001 each 479,606,395 47,960.64 Deferred Shares of £0.01 each 1,000,000 10,000

3.1 At the Latest Practicable Date, none of the Ordinary Shares were held in treasury. 3.2 A description of the movements in issued share capital of the Company during the ﬁnancial years ended 31 December 2012, 31 December 2013, 31 December 2014, and the period between 1 January 2015 and 20 March 2015 can be found on pages 481 to 483 of the March 2015 Prospectus and is incorporated by reference into this document. See Part XII (Information Incorporated by Reference) of this document for further details about information that has been incorporated by reference into this document. 3.3 On 20 March 2015, the issued and fully paid share capital of the Company was 163,153,081 Ordinary Shares of £0.0001 each and 1,000,000 Deferred Shares of £0.01 each. 3.4 Between 20 March 2015 and the Latest Practicable Date, the Company issued 272,495,506 Ordinary Shares in connection with the Rights Issue, 611,663 Ordinary Shares in connection with the FANS Acquisition, 37,493,053 Ordinary Shares in connection with the Skrill Acquisition, 3,210,400 Ordinary Shares in connection with the Meritus Acquisition, and 2,642,692 Ordinary Shares pursuant to the Paysafe Employee Share Plans. 3.5 Save as disclosed in this paragraph 3 or in the information on pages 481 to 483 of the March 2015 Prospectus and incorporated by reference into this document, since 31 December 2011 no Ordinary Shares have been issued by the Company, fully or partly paid, either in cash or for other consideration and (other than in connection with the vesting or exercise of awards under the Paysafe Employee Share Plans, and the issue of up to 2,551,970 Ordinary Shares in connection with the FANS Acquisition), no such issues are proposed. 3.6 Other than in connection with the Paysafe Employee Share Plans and the Meritus Amendment Agreement, no share capital of the Company or any of its subsidiaries is under option or agreed conditionally or unconditionally to be put under option. The Company has not

299 issued any convertible securities, exchangeable securities or securities with warrants, and, other than in connection with the US Acquisitions and the FANS Acquisition, there are no acquisition rights and/or obligations over unissued share capital or any undertakings to increase the share capital of the Company. 3.7 As at the Latest Practicable Date, the authorised share capital of the Company is 600,000,000 Ordinary Shares of £0.0001 each and 1,000,000 Deferred Shares of £0.01 each. The number of Ordinary Shares and Deferred Shares outstanding as at 1 January 2014, being the first day of the Company’s last complete financial year, and as at 31 December 2014, being the last day of the Company’s last complete financial year, was:

Issued and Issued and fully paid fully paid Ordinary Deferred Shares Shares

31 December 2014 163,057,414 1,000,000 1 January 2014 151,104,164 1,000,000

The Ordinary Shares in issue on Admission are in registered form and are capable of being held in uncertiﬁcated form.

4. MEMORANDUM AND ARTICLES OF ASSOCIATION 4.1 The Memorandum and Articles of Association of the Company was adopted pursuant to a Special Resolution of the Company passed on 11 May 2011. The provisions of the Memorandum and Articles of Association of the Company can be found on pages 483 to 489 of the March 2015 Prospectus and are incorporated by reference into this document. See Part XII (Information Incorporated by Reference) of this document for further details about information that has been incorporated by reference into this document. 4.2 At the General Meeting, the Shareholders approved, amongst other things, the adoption of new articles of association (the ‘‘New Articles’’), conditional on Admission. The New Articles reﬂect the enhanced legal and regulatory requirements of a company whose shares are admitted to the premium segment of the Ofﬁcial List and to trading on the Main Market. 4.3 The New Articles will incorporate the following amendments:

Authorised share capital At the extraordinary general meeting of the Company held on 16 April 2015, the authorised share capital was increased to £70,000 by the creation of 400,000,000 ordinary shares of £0.0001 each. The current authorised share capital of the Company is 600,000,000 Ordinary Shares of £0.0001 each and 1,000,000 Deferred Shares of £0.01 each and this will be reﬂected in the New Articles.

Pre-emption rights The New Articles will require the Company to obtain the approval of its members by way of a special resolution, as opposed to an ordinary resolution, in order to disapply pre-emption rights.

Disclosure of interest in shares The Articles of Association included provisions to support the Company’s notiﬁcation obligations under Rule 17 of the AIM Rules for Companies. These provisions have not been included in the New Articles as they will not be relevant to the Company after Admission. Upon Admission, the Company will be required to comply with the rules regarding the disclosure of major interests in shares under Chapter 5 of the Disclosure and Transparency Rules.

300 General meetings The quorum for all general meetings will be reduced to two members present in person or by proxy and entitled to vote on a poll. Persons appointed by proxy will be permitted to vote on a show of hands and on a poll vote at general meetings. The Chairman’s casting vote at a general meeting of the Company has been removed in order to ensure equal treatment to all members of the Company.

Directors Annual re-election The New Articles will require the annual re-election of the directors, in accordance with the requirement for FTSE 350 companies under the Corporate Governance Code. Directors’ remuneration The maximum aggregate remuneration for non-executive directors will be increased.

Borrowing powers The New Articles will allow the board to exercise all voting and other rights or powers of control exercisable by the Company in relation to its subsidiary undertakings so as to secure that the aggregate principal amount outstanding at any time in respect of all borrowings by the Paysafe Group (exclusive of any intra-group loans) will not, without the previous sanction of the Company in general meeting, exceed an amount three times adjusted capital and reserves (as deﬁned in the New Articles), or any higher limit ﬁxed by an ordinary resolution of the Company which is applicable at the relevant time.

5. INTERESTS OF DIRECTORS AND SENIOR MANAGEMENT Save as set out in paragraph 5.1 below, no Director has any interests (beneﬁcial or non- beneﬁcial) in the share capital of the Company or any of its subsidiaries.

5.1 Directors’ shareholdings As at the Latest Practicable Date, the interests of the Directors and persons connected to them as notiﬁed to the Company in accordance with the Articles are as follows:

Percentage Number of of ordinary Ordinary share Director Shares capital

Joel Leonoff 6,002,926(1) 1.25 Brian McArthur-Muscroft — — Dennis Jones — — Andrew Dark — — Ian Francis — — Brahm Gelfand 12,000 0.00 Ian Jenks — —

(1) This includes the 1,500,000 Ordinary Shares pledged by Mr Leonoff in favour of Equities First Holdings, LLC.

Mr Leonoff entered into a master loan and pledge agreement with Equities First Holdings, LLC (‘‘EFH’’) on 31 March 2014. Pursuant to that agreement, Mr Leonoff pledged 1,500,000 shares (the ‘‘Pledged Shares’’) as collateral for a loan of approximately £4 million (together the ‘‘Loan’’). For the purposes of securing the Loan, during the period of the Loan Mr Leonoff has transferred title and voting rights in the Pledged Shares. The Pledged Shares will be transferred back to Mr Leonoff when he repays the Loan at the expiration of its three year term.

301 As at the Latest Practicable Date, the interests of the Directors and persons connected to them in Ordinary Shares under the Paysafe Employee Share Plans are as set out below:

The Approved Director The Plan Plan The LTIP

Joel Leonoff — — 4,448,902* Brian McArthur-Muscroft — — 823,126* Dennis Jones — — — Andrew Dark — — — Ian Francis — — — Brahm Gelfand — — — Ian Jenks — — —

* The options granted to Mr Leonoff and Mr McArthur-Muscroft include 683,246 and 306,282 options respectively, granted on 29 June 2015 pursuant to the Paysafe Long Term Incentive Plan. The options will vest three years from after the date of grant and are subject to two performance conditions: (i) 50 per cent. of the options are subject to a relative Total Shareholder Return (‘‘TSR’’) performance condition, measured against the constituents of the FTSE 250 index (excluding investment trusts); and (ii) 50 per cent. of the options are subject to challenging earnings per share (‘‘EPS’’) targets. The EPS targets will have an appropriate sliding scale and will be disclosed in the Company’s Annual Report and Accounts for the year ended 31 December 2015. Both the TSR and EPS targets will be measured until 31 December 2017.

No Director has or has had any interest in any transactions which are or were unusual in their nature or conditions or are or were significant to the business of the Paysafe Group or any of its subsidiary undertakings and which were effected by the Paysafe Group or any of its subsidiaries during the current or immediately preceding financial year or during an earlier financial year and which remain in any respect outstanding or unperformed.

There are no outstanding loans or guarantees granted or provided by any member of the Paysafe Group to or for the beneﬁt of any of the Directors, save that qualifying third party indemnity provisions are in place for the beneﬁt of Directors in relation to certain losses and liabilities which they may potentially incur to third parties in the course of their duties.

5.2 Senior Management’s shareholding As at the Latest Practicable Date, the interests of the Senior Management are as follows:

Percentage Number of of ordinary Ordinary share Senior Manager Shares capital

Danny Chazonoff 0 0 Elliott Wiseman 0 0

As at the Latest Practicable Date, the interests of the Senior Managers in Ordinary Shares under the Paysafe Employee Share Plans are as set out below:

The Approved Senior Manager The Plan Plan The LTIP

Danny Chazonoff — — 2,682,428* Elliott Wiseman — — 302,499*

* The options granted to Mr Chazonoff and Mr Wiseman include 176,701 and 250,815 options respectively, granted on 29 June 2015 pursuant to the Paysafe Long Term Incentive Plan. The options will vest three years from after the date of grant and are subject to two performance conditions: (i) 50 per cent. of the options are subject to a relative Total Shareholder Return (‘‘TSR’’) performance condition, measured against the constituents of the FTSE 250 index (excluding investment trusts); and (ii) 50 per cent. of the options are subject to challenging EPS targets. The EPS targets will have an appropriate sliding scale and will be disclosed in the Company’s Annual Report and Accounts for the year ended 31 December 2015. Both the TSR and EPS targets will be measured until 31 December 2017.

302 No member of the Senior Management has or has had any interest in any transactions which are or were unusual in their nature or conditions or are or were significant to the business of the Paysafe Group or any of its subsidiary undertakings and which were effected by the Paysafe Group or any of its subsidiaries during the current or immediately preceding financial year or during an earlier financial year and which remain in any respect outstanding or unperformed. There are no outstanding loans or guarantees granted or provided by any member of the Paysafe Group to or for the benefit of any of the members of Senior Management, save that qualifying third party indemnity provisions are in place for the benefit of Senior Management in relation to certain losses and liabilities which they may potentially incur to third parties in the course of their duties.

6. DIRECTORS AND SENIOR MANAGEMENT 6.1 Executive Directors Joel Leonoff was appointed as the Company’s co-Chief Executive Officer on 1 February 2011 and was appointed as President and sole Chief Executive Officer of the Company on 31 July 2011. His service contract, dated 31 January 2011, requires him to give twelve months’ notice of termination and requires the Company to give twelve months’ notice of termination. Brian McArthur-Muscroft was appointed as the Company’s Chief Financial Officer on 1 January 2015. His service contract, dated 11 December 2014, has a start date of 1 January 2015. The service contract can be terminated by either party upon twelve months’ notice of termination. Additionally, the Company has the right to terminate the service agreement with immediate effect at its sole and absolute discretion by making a suitable payment equivalent to all salary and benefits for the twelve month notice period. In certain circumstances, the Company is entitled to terminate the employment of the Executive Directors without notice where, for example, the Executive Director has committed an act of gross misconduct, is convicted of a criminal offence or is disqualified from acting as a director. The Executive Directors are entitled to participate in the Paysafe Employee Share Plans and the Company’s pension schemes (although Joel Leonoff does not receive a pension allowance). The Executive Directors are subject to a number of restrictive covenants during the 12 month period beginning on the date that their service contract is terminated, which prevent them from accepting a position as a director or a senior employee, manager or consultant in a business which is similar to or directly competes with the Company. The service contracts also include non-solicitation provisions in respect of the Company’s merchants, prospective merchants and key employees.

303 The key provisions of the Executive Directors’ service agreements are set out below:

Executive Director Joel Leonoff Brian McArthur-Muscroft

Current annual salary £580,000 £390,000 Maximum bonus as 200 160 percentage of salary Benefits Paysafe Employee Share Plans, Paysafe Employee Share Plans, executive bonus plan, life executive bonus plan, pension assurance and private medical supplement (equal to 20% per insurance, dental insurance annum of basic salary), life assurance and private medical insurance, dental insurance, car allowance Date of contract 31 January 2011 11 December 2014 Date of expiry of contract No fixed term No fixed term Notice period 12 months’ notice for both 12 months’ notice for both Executive Director and the Executive Director and the Company Company 6.2 Non-Executive directors: appointment letters Non-Executive Directors, including the Chairman, do not hold service contracts and each of the Non-Executive Directors has been appointed pursuant to letters of appointment. Non- Executive Directors have letters of appointment for an initial twelve month term. At the end of the initial term, the appointment may be continued by mutual agreement and, subject to the terms of the Articles of Association and the Acts. Each Non-Executive Director is entitled to receive a fee in consideration of the services provided to the Company and is also entitled to reimbursement of reasonable expenses. The Non-Executive Directors are not entitled to bonuses, benefits, pensions contributions or to participate in any incentive schemes. The Non-Executive Directors are subject to confidentiality undertakings without limitation in time. The appointment as Non-Executive Director may be terminated by either the Company or the Non-Executive Director giving to the other not less than three months’ prior written notice of such termination. The Non-Executive Directors are not entitled to any compensation upon the termination of their appointment. The key provisions of the Non-Executive Directors’ letters of appointment are set out below:

Non-Executive Date of Term of Notice period Director Position Basic Fee contract contract

Dennis Jones Chairman and £250,000 30 July 2014 No fixed term 3 months Non-Executive Director Andrew Dark Non-Executive £65,000 30 July 2014 No fixed term 3 months Director Ian Francis Non-Executive £65,000 2 August 2010 No fixed term 3 months Director (appointment commenced on 1 September 2010) Brahm Gelfand Non-Executive £65,000 13 March 2014 No fixed term 3 months Director Ian Jenks Non-Executive £65,000 30 July 2014 No fixed term 3 months Director The Board, on the recommendation of the Company’s Remuneration Committee, approved further payments to the Non-Executive Directors in respect of the additional work undertaken by them during the period of 1 July 2014 to 31 December 2014 further to their roles on the

304 Company’s Audit, Nomination and Remuneration Committees and the Board’s due diligence committee. For the period to 31 December 2014, an additional fee of £10,600 was paid to Dennis Jones, an additional fee of £10,000 was paid to Andrew Dark, an additional fee of £12,150 was paid to Ian Francis, an additional fee of £8,150 was paid to Brahm Gelfand and an additional fee of £25,200 was paid to Ian Jenks. During FY2015, the Board approved further payments to the Non-Executive Directors in respect of the additional work undertaken and to be undertaken by them further to their roles on the Audit Committee, Nomination Committee and Remuneration Committee. Such fees related to additional work carried out by the Non-Executive Directors in respect of the Board’s due diligence committee, the Integration Committee and in respect of their roles as directors of FCA regulated entities within the Paysafe Group. Details of these additional fees will be disclosed in the Company’s Directors’ Remuneration Report for 2015 which will form part of the Company’s 2015 Annual Report and Accounts.

6.3 Senior Management Danny Chazonoff has been the Chief Operating Ofﬁcer of Paysafe since 31 July 2011. His service contract, dated 31 January 2011, requires him to give twelve months’ notice of termination and requires the Company to give twelve months’ notice of termination. Elliott Wiseman was appointed as General Counsel on 8 November 2011. His service contract, dated 4 August 2011, can be terminated by either party upon six months’ notice of termination. The key provisions of the Senior Managers’ service agreements are set out below:

Senior Manager Danny Chazonoff Elliott Wiseman

Current annual salary C$600,000 £200,000 Maximum bonus as 100 75 percentage of salary Benefits Paysafe Employee Share Plans, Paysafe Employee Share Plans, executive bonus plan, pension executive bonus plan, pension scheme, life assurance and scheme, life assurance and private medical insurance, private medical insurance, dental insurance dental insurance Date of contract 31 January 2011 4 August 2011 Date of expiry of contract No fixed term No fixed term Notice period 12 months’ notice for both 6 months’ notice for both Senior Senior Manager and the Manager and the Company Company 7. PENSIONS 7.1 The Paysafe Group operates the following pension/retirement savings schemes: (a) A registered retirement savings plan (‘‘RRSP’’) in Calgary, Canada with voluntary participation (as at the Latest Practicable Date, participation is at 7 per cent.). The RRSP is an employee contribution only programme, meaning that the Paysafe Group is not required to make contributions. (b) An RRSP in Montreal and Gatineau, Canada with voluntary participation. Employees may contribute up to 2 per cent. of their annual earnings per year, and the Paysafe Group is liable to match 100 per cent. of the employee contribution up to the maximum 2 per cent. This RRSP has participation from Paysafe Services (Canada) Inc. (60 per cent.), Paysafe Technologies Inc., (70 per cent.) and Paysafe Merchant Services Inc. (50 per cent.). (c) A 401(k) plan in Irvine, California with voluntary participation. Employees can contribute up to 100 per cent. of their compensation per year up to a maximum limit, which in 2014 is generally US$17,500 (US$23,000 for those age 50 or older). The Paysafe Group has committed to matching the employee’s contribution by 100 per cent. of the first 3 per cent. of compensation and by 50 per cent. of the next 2 per cent. of compensation that

305 the employee contributes to the plan. The Paysafe Group may also make a discretionary profit sharing contribution for all eligible employees. There was no discretionary employer contribution to the plan for the 2014 plan year. The total employer contribution to the plan for the 2014 plan year was C$184,407. (d) A group personal pension plan in the UK administered by Aviva. This is a defined contribution scheme under which employed members can select a rate of contributions from time to time, and the employer will match the employee’s contributions up to a maximum of 5 per cent. of pensionable pay. (e) A defined contribution group personal pension plan in the UK. The contributions from the Paysafe Group are limited to 4 per cent. of the basic salary of each eligible employee. This is payable whether or not the employee is contributing to the pension scheme. The group personal pension plan is managed by Scottish Widows and administered by Secondsight, the Employee Benefits division of Foster Denovo Ltd. The cash cost of the Skrill Group’s contributions to the group personal pension plan pension contributions for FY2014 was £289,904.86. (f) A pension scheme implemented by Skrill Services GmbH in Germany based on direct insurance, for the benefit of one employee. In a direct insurance pension scheme, the employer takes out insurance and the employee is the beneficiary. The employee has a direct claim against the insurance company while the employer remains indirectly liable for the benefits. Contributions to the direct insurance pension scheme are made by the beneficiary employee through a salary sacrifice arrangement with Skrill Services GmbH. (g) A defined contribution pension scheme implemented by paysafecard.com Wertkarten GmbH in Austria. The contributions of paysafecard.com Wertkarten GmbH are limited to a maximum of 3 per cent. for employees and 5 per cent. for the CEO. The cash cost of paysafecard.com Wertkarten GmbH and paysafecard.com Vertriebs GmbH’s contributions to the group personal pension plan pension contributions for FY2014 was £206,694.28. (h) A defined contribution pension scheme implemented by Ukash for the benefit of Ukash employees. The contributions from Ukash are limited to a maximum of 4 per cent. for employees, six per cent. for management and 10 per cent. for executives. The pension scheme is managed by Scottish Widows. The cash cost of the Ukash’s contributions to the defined contribution pension scheme for FY2014 was £362,548.80. 7.2 The Paysafe Group does not operate a pension scheme in Los Angeles, California or Sofia, Bulgaria. 7.3 The Paysafe Group does not operate a pension plan for its Executive Directors. Joel Leonoff and Brian McArthur-Muscroft did not receive any pension contributions from the Paysafe Group during the financial year ended 31 December 2014. 7.4 During FY2016, the Paysafe Group intends to consolidate each of the defined contribution pension schemes in the UK, whilst ensuring that the relevant Paysafe Group employees do not suffer any losses or other detrimental effects as a result of the consolidation exercise. 7.5 In addition, Skrill USA Inc. has a 401K plan in the USA, which will become one of the Paysafe group’s pension plans if the Paysafe Group acquires Skrill USA Inc. The 401K plan is a ‘‘safe harbour’’ plan and it uses a safe harbour employer contribution of 100 per cent. of the first 3 per cent. of an employee’s salary deferrals and 50 per cent. of the next 2 per cent. of an employee’s salary deferrals, as capped by certain limits imposed by the Internal Revenue Service. The cash cost of the Skrill Group’s contributions to the 401K plan pension contributions for FY2014 was US$9,110.

8. TAKEOVER BIDS 8.1 Mandatory bids The City Code applies to the Company. Under the City Code, if an acquisition of Ordinary Shares were to increase the aggregate holding of an acquirer and its concert parties to an interest in Ordinary Shares carrying 30 per cent. or more of the voting rights in the Company, the acquirer and, depending upon the circumstances, its concert parties, would be required (except with the consent of the Panel on Takeovers and Acquisitions) to make a cash offer for the outstanding Ordinary Shares in the Company at a price not less than the highest price

306 paid for the Ordinary Shares in the Company by the acquirer or its concert parties during the previous 12 months. A similar obligation to make such a mandatory offer would also arise on the acquisition of Ordinary Shares by a person holding (together with its concert parties) Ordinary Shares carrying between 30 to 50 per cent. of the voting rights in the Company if the effect of such acquisition were to increase that person’s percentage of the voting rights.

8.2 Squeeze out Pursuant to section 143 of the Companies Act 1931, if a contract involving the transfer of shares or any class of shares in the capital of the Company to another company (‘the transferee company’) has within four months after the making of the offer by the transferee company been approved by the holders of not less than nine-tenths in value of the shares affected, the transferee company may, at any time within two months after the expiration of such four month period, give notice in the prescribed manner to any dissenting shareholder that it desires to acquire his shares, and where such a notice is given the Company shall, unless on an application made by the dissenting shareholder within one month from the date on which the notice was given the court thinks ﬁt to order otherwise, be entitled and bound to acquire those shares on the terms on which under the contract the shares of the approving shareholders are to be transferred to the transferee company. Where a notice has been given by the transferee company and the court has not, on an application made by the dissenting shareholder, ordered to the contrary, the transferee company shall, on the expiration of one month from the date on which the notice has been given, or, if an application to the court by the dissenting shareholder is then pending, after that application has been disposed of, transmit a copy of the notice to the Company and pay or transfer to the Company the amount or other consideration representing the price payable by the transferee company for the shares which by virtue of section 143 of the Companies Act 1931 the transferee company is entitled to acquire, and the Company shall thereupon register the transferee company as the holder of those shares.

9. SIGNIFICANT SHAREHOLDINGS 9.1 As at the Latest Practicable Date, save as disclosed in paragraph 5.1 of this Part XI in respect of Directors’ interests, the Company had been notiﬁed of the following persons who were or will be directly or indirectly interested in three per cent. or more of the existing issued ordinary share capital of the Company:

Percentage of existing Number of ordinary Ordinary share Name Shares capital

Old Mutual Global Investors 57,110,374 11.9 Fidelity Management & Research 31,394,498 6.6 Franklin Templeton Investments 30,556,891 6.4 Kames Capital 15,165,022 3.2 9.2 None of the signiﬁcant Shareholders referred to above have different voting rights from any other holder of Ordinary Shares in respect of the Ordinary Shares held by them. 9.3 The Company is not aware of any person or persons who, directly or indirectly, acting jointly with others or acting alone, exercised or could exercise control over the Company. 9.4 The Company is not aware of any arrangements the operation of which may, at a subsequent date, result in a change of control of the Company.

307 10. PRINCIPAL SUBSIDIARIES The table below contains a list of the principal subsidiaries, joint ventures and associates of the Company (each of which is considered by the Paysafe Group to be likely to have a significant effect on the assessment of the assets, liabilities, the financial position and/or the profits and losses of the Paysafe Group): Proportion Proportion of direct or of direct or indirect indirect Country of ownership voting Name Incorporation interest power held

Paysafe Financial Services Limited England and Wales 100% 100% Digital Payments Europe Limited England and Wales 100% 100% Paysafe Processing Limited England and Wales 100% 100% Netinvest Limited England and Wales 100% 100% Optimal Payments (UK) Limited England and Wales 100% 100% Prepaid Services Company Limited England and Wales 100% 100% MB Acquisitions Limited England and Wales 100% 100% Sentinel Holdco 2 Limited England and Wales 100% 100% Sentinel Midco Limited England and Wales 100% 100% Sentinel Bidco Limited England and Wales 100% 100% Skrill Holdings Limited England and Wales 100% 100% Skrill International Payments Limited England and Wales 100% 100% Skrill Limited England and Wales 100% 100% Smart Voucher Limited England and Wales 100% 100% NT Services Limited Canada 100% 100% 1155259 Alberta Limited Canada 100% 100% Paysafe Services (Canada) Inc. Canada 100% 100% Paysafe Technologies Inc Canada 100% 100% Paysafe Merchant Services Inc Canada 100% 100% Paysafe CallCo Inc. Canada 100% 100% Paysafe ExchangeCo Inc. Canada 100% 100% FANS Entertainment Inc. Canada 100% 100% Skrill Canada Inc. Canada 100% 100% Paysafe Merchant Services Limited Isle of Man 100% 100% Net Group Holdings Limited Isle of Man 100% 100% Paysafe Finance Limited Isle of Man 100% 100% NBX Merchant Services Corp United States 100% 100% Optimal Payments Services Inc. United States 100% 100% TK Global Partners, LP United States 100% 100% OPL Payment Services LLC United States 100% 100% Netbx Services LLC United States 100% 100% NBX Holdings Corp United States 100% 100% NBX Services Corp United States 100% 100% FANS Entertainment LLC United States 100% 100% Paysafecard.com USA, Inc. United States 100% 100% Sentinel Topco Limited Jersey 100% 100% Skrill Group Limited Jersey 100% 100% paysafecard.com Argentina S.R.L. Argentina 100% 100% Digital Payments Solutions Australia Pty Australia 100% 100% Limited paysafecard.com Wertkarten GmbH Austria 100% 100% Paysafecard.com Wertkarten Vertriebs Austria 100% 100% GmbH Payolution GmbH Austria 100% 100% Sabemul Beteiligungsverwaltungs GmbH Austria 100% 100% cpt Dienstleistungen GmbH Germany 100% 100% Skrill Services GmbH Germany 100% 100% Optimal Payments (Bulgaria) EOOD Bulgaria 100% 100% Paysafe Bulgaria EOOD Bulgaria 100% 100%

308 Proportion Proportion of direct or of direct or indirect indirect Country of ownership voting Name Incorporation interest power held

MAC Limited Gibraltar 100% 100% Skrill Hong Kong Limited Hong Kong 100% 100% paysafecard.com Me´xico S.A. de C.V. Mexico 100% 100% Digital Payments Solutions New Zealand New Zealand 100% 100% Ltd Skrill Singapore Ptc. Limited Singapore 100% 100% Paysafecard.com Schweiz GmbH Switzerland 100% 100% paysafard.com o¨n o¨deme servicleri limited Turkey 100% 100% s¸irketi The Company currently has no principal investments (in progress or planned for the future on which the Directors have made ﬁrm commitments or otherwise) other than the subsidiaries and subsidiary undertakings listed above.

11. PAYSAFE EMPLOYEE SHARE PLANS 11.1 The Company operates:

(a) the Paysafe Share Option Plan;

(b) the Paysafe Approved Share Option Plan; and

11.2 The Paysafe Share Option Plan (the ‘‘Plan’’) is an unapproved employee share option plan adopted on 7 April 2004 and amended on 15 September 2008. The principal terms of the Plan are as follows:

(a) Administration The Plan is administered and the grant of options supervised by the Remuneration Committee.

(b) Eligibility The Remuneration Committee may select employees and directors of Paysafe and of its subsidiaries to whom options may be granted over Ordinary Shares.

(c) Exercise price The exercise price per Ordinary Share will not be less than the average of the middle market quotations for the three Dealing Days immediately preceding the date of grant as derived from the AIM section of the Daily Ofﬁcial List or in the case of an option to subscribe, the nominal value of an Ordinary Share if higher.

(d) Performance conditions The exercise of options may be made conditional on the achievement of a speciﬁed performance condition or vesting condition determined by the Remuneration Committee when options are granted.

(e) Grant of options Options may normally only be granted within the period of 42 days commencing on the date of the announcement by Paysafe of its results for any period but no grant of options shall be made on or before the third Dealing Day of the 42 days period but no grant of options shall be made on or before the third Dealing Day of the 42 days period. Options may be granted outside these periods if the Remuneration Committee considers that there are sufﬁciently exceptional circumstances to justify the grant of options at that time. No payment is required for the grant of an option.

309 (f) Limitations on participation Each individual’s participation in the Plan will be limited (save where the Remuneration Committee resolves that exceptional circumstances exist) so that the aggregate price payable for Ordinary Shares under options granted under the Plan in any calendar year will not exceed 200 per cent. of his annual rate of remuneration. Benefits under the Plan are not pensionable. (g) Exercise of options In normal circumstances, an option may only be exercised to the extent that it has vested and, in the case of an option granted subject to the satisfaction of a performance condition, if that performance condition has been satisfied. One third of any option granted will vest at the end of each year over the period of three years from the date of grant. Further vesting will cease on cessation of employment unless the Board otherwise determines. The option (whether vested or unvested) will lapse immediately if the participant ceases to be an employee of the Paysafe Group by reason of gross misconduct, fraud or dishonesty or otherwise six months after ceasing to be employed within the Paysafe Group. In the event of a takeover the unvested balance of an option shall vest provided that the participant has not ceased to be employed within the Paysafe Group. Special provisions will apply in the event of a takeover or liquidation of Paysafe. When options are exercised the participant must account for any income tax and national insurance contributions due on the option gain. Options may be granted on terms that the participant bears any employer’s national insurance contributions. (h) Terms of options and issue of Ordinary Shares Options are neither transferable nor assignable. Within 30 days after the exercise of an option granted over the relevant shares, the appropriate number of Ordinary Shares will be allotted and issued to the option holder. The Ordinary Shares allotted will rank pari passu with all other issued Ordinary Shares save that they will not rank for any dividend or other rights attaching to such shares by reference to a record date prior to their issue. Existing Ordinary Shares may also be transferred on the exercise of an option. (i) Variation of capital In the event of a variation of share capital, including a capitalisation issue or rights issue or any consolidation, sub-division or reduction of capital of Paysafe, the number and exercise price of Ordinary Shares subject to options shall be adjusted, among other factors, in such manner as the auditors of Paysafe confirm in their opinion is fair and reasonable. (j) Amendment and termination The Board may on the recommendation of the Remuneration Committee make amendments to the Plan, but no amendment may be made which would adversely affect any rights already acquired by a participant except with (i) the consent in writing of participants who, if they exercised their options in full, would become entitled to not less than 75 per cent of all the shares comprising options under the Plan; (ii) or resolution passed at a meeting by not less than 75 per cent of the participants who attend and vote either in person or proxy. No alteration to the advantage of participants may be made to provisions relating to the persons to whom options may be granted, the limits on the total number of Ordinary Shares over which options may be granted, the limits on the number of options which may be granted to any participant, the adjustments to be made in the event of a variation of share capital, the periods during or circumstances in which the options may exercise or the option exercise price without the prior approval of Paysafe by an ordinary resolution (except for minor alterations to benefit the administration of the Plan, to take account of a change in legislation or to obtain or maintain favourable exchange control or regulatory treatment for participants or any member of the Paysafe Group). (k) Limits on share capital available to the Plan The nominal value of shares subject to grants of options to subscribe Ordinary Shares in any one calendar year is limited to three per cent. of the nominal value of Paysafe’s issued ordinary share capital immediately before the proposed date of grant. Any unused portion of the limit may be carried forward for one year.

310 11.3 The Paysafe Approved Share Option Plan (the ‘‘Approved Plan’’) is a company share option plan meeting the requirements of Schedule 4 of the Income Tax (Earnings and Pensions) Act 2003 adopted on 15 September 2008. The principal terms of the Approved Plan are similar to the Plan save that:

(a) a Director will only be eligible to participate in the Approved Plan if he is a qualifying employee or obliged to devote not less than 25 hours per week to working for the Paysafe Group;

(b) the Board may not select anyone to participate in the Approved Plan who has a material interest in Paysafe under HMRC rules;

(c) in normal circumstances, an option may only be exercised to the extent that it has vested and, in the case of an option granted subject to the satisfaction of a performance condition, if that performance condition has been satisﬁed. One third of any option granted will vest at the end of each year over the period of three years from the date of grant. Further vesting will cease on cessation of employment unless the Board otherwise determines. In the event of a takeover the unvested balance of an option shall vest provided that the participant has not ceased to be employed within the Paysafe Group. Special provisions will apply in the event of a takeover or liquidation of Paysafe; and

(d) no option shall be granted under the Approved Plan if, as a result, the aggregate market value of the Ordinary Shares at the time of grant together with the aggregate market value of Ordinary Shares (at the relevant date of grant) which the option holder could acquire on exercise of options under the Approved Plan and any other company share option plan for the purposes of the Income Tax (Earnings and Pensions) Act 2003 of Paysafe (or any associated company) would exceed £30,000.

11.4 The Paysafe Long Term Incentive Plan (the ‘‘LTIP’’) was adopted by the Board on 3 March 2010, to take effect from 1 January 2010, and was amended on 9 July 2014.

(a) Administration The LTIP is administered and the grant of awards supervised by the Remuneration Committee.

(b) Eligibility The Remuneration Committee may select employees of Paysafe and of its subsidiaries to whom awards may be granted.

(c) Grant of awards An award may take the form of a grant of an option over Ordinary Shares (with or without an option price) or a conditional right to acquire Ordinary Shares. Awards may be satisfied by the issue of new Ordinary Shares or the transfer of treasury shares or shares other than treasury shares. Awards may be granted within six weeks following the Dealing Day after the date on which Paysafe announces its results for any financial period or at any other time when the Remuneration Committee considers that circumstances are sufficiently exceptional to justify a grant.

The Remuneration Committee will also determine other terms of the award including any performance criteria to be satisﬁed before an award becomes exercisable or is released to a participant. Awards granted under the LTIP are personal to the option holder and may not be transferred. No consideration is payable on the grant of an award.

The Remuneration Committee may substitute vested conditional awards or exercised options with additional employment income.

(d) Performance measures The criteria for and timing of vesting of the awards are determined by the Remuneration Committee and may include performance conditions based on the performance of the Paysafe Group. Awards may be granted in tranches and where this is the case, separate tranches may be subject to different performance conditions.

311 (e) Limitations on participation The maximum value of the Ordinary Shares over which an individual award can be made in each ﬁnancial year is 100 per cent. of an employee’s base salary expressed as an annual rate unless the Remuneration Committee considers it appropriate to grant an individual award in excess of this limit.

The market value of the Ordinary Shares over which an award is made shall be taken to be an amount equal to the average middle-market quotations of such Ordinary Shares on the London Stock Exchange either on the day before the date of grant of an award as obtained from the London Stock Exchange Daily Official List or if the Remuneration Committee so determines, a period of not exceeding five Dealing Days before the date of grant provided that the period complies with the Paysafe’s Share dealing code. No benefits received by any participant under the LTIP will be pensionable.

(f) Exercise of awards An award will normally be exercisable on the later of (i) the third anniversary of the date of grant; and (ii) if a condition has been imposed, the date on which the Remuneration Committee determines that it has been satisﬁed. However, if an award has been granted in tranches it may vest at an earlier time if this is speciﬁed by the Remuneration Committee at the date of award.

If a participant dies or if the participant’s employment terminates before the normal vesting date by reason of: injury; disability; ill health; redundancy; retirement with the agreement of his employer; his employer ceasing to be a member of the Paysafe Group; or because the business in which he is employed is transferred out of the Paysafe Group or for any other reason the Remuneration Committee so decides, his award will be exercisable over a proportionate number of Ordinary Shares depending on when he ceases relevant employment and if and to what extent the performance condition is met. If the participant ceases to be employed by the Paysafe Group for the reasons listed above after the normal vesting date his award may be exercised for 12 months from the date of cessation or until the end of the exercise period if shorter.

If the participant ceases to be employed by the Group in any circumstances other than for the reasons listed above, his award will lapse immediately on the date of cessation. Special provisions apply in the event of a takeover and other corporate events such as winding-up and internal reorganisations of Paysafe.

(g) Variation of capital The Remuneration Committee may at any time make such adjustments to any outstanding awards as it shall deem appropriate in the event of variation in the share capital or demerger, special dividend or other similar event which affects the market price of the Ordinary Shares of Paysafe to a material extent.

(h) Amendment The Remuneration Committee may amend the LTIP at any time in any respect. No amendment may be made to alter to the material disadvantage of any participant any rights already acquired by him (other than a change in any performance condition) without the consent of a majority of participants responding to any relevant request.

(i) Limits on share capital available to the LTIP An award may not be granted if, as a result, the aggregate number of Ordinary Shares issued or which may be issued in any period of ten years on or after 14 April 2004 pursuant to awards granted under the LTIP or options under any other employees’ share scheme adopted by Paysafe would exceed 10 per cent. of the issued ordinary share capital of Paysafe from time to time.

312 11.5 The Company has also established, but not yet operated, the following all-employee share plans: (a) the Paysafe Share Incentive Plan; and (b) the Paysafe Sharesave Plan. These plans were adopted by the Board on 3 December 2015. 11.6 The principal terms of the Paysafe Share Incentive Plan (‘‘SIP’’) are summarised below:

(a) Outline The SIP is an all employee plan which allows employees to be offered free, partnership and matching shares as determined by the Remuneration Committee. The SIP operates in conjunction with a trust, which will hold Ordinary Shares on behalf of employees. In the UK, SIP will operate within HMRC’s tax favoured regime for such all-employee plans.

(b) Eligibility Executive Directors and all employees of the Company and any participating subsidiaries will be eligible to join the SIP. The Remuneration Committee may require individuals to have worked for a qualifying period before joining the SIP.

(c) Free Shares The SIP allows eligible employees to be offered free shares (‘‘free shares’’) worth up to £3,600 in any tax year or such other level as may be speciﬁed by HMRC from time to time. Free shares must be offered to all eligible employees on similar terms and can be subject to certain performance criteria permitted by the HMRC legislation. The number of free shares awarded can vary by reference to the eligible employee’s remuneration or other criteria. Free shares must be held in trust for a period of between three and ﬁve years at the discretion of the Company.

(d) Partnership Shares The SIP allows eligible employees to be offered the opportunity to purchase Ordinary Shares using money deducted from their salary (‘‘partnership shares’’). The amount deducted must not exceed £1,800 (or 10 per cent. of salary, if lower) or such other level as may be speciﬁed by HMRC from time to time, in any tax year. In the UK, this purchase may be made from pre-tax salary.

(e) Matching Shares If employees buy partnership shares, they may be awarded additional free shares (‘‘matching shares’’) by the Company of up to a current maximum of two matching shares for each partnership share. Employees may not generally withdraw the matching shares for three years.

(f) Dividends Directors may permit any dividends paid on the free, partnership or matching shares to be re-invested in the purchase of additional Ordinary Shares, which must be held in the SIP for a period of three years.

(g) Leaving Employment Ordinary Shares allocated to a participant must be withdrawn from the SIP immediately. Ordinary Shares awarded as free shares or matching shares may, if the Remuneration Committee so determines prior to the grant of an award, be forfeited where employment ceases before the third anniversary of the award date unless the participant leaves by reason of death, injury, disability, redundancy, retirement or the sale of the business or subsidiary for which the participant works.

(h) Takeovers and Reconstructions If a takeover offer or a scheme of arrangement is proposed to the Shareholders, participants may direct the trustees how to act in respect of any Ordinary Shares held on their behalf and any holding and/or forfeiture periods shall cease.

313 (i) Amendment and extension of SIP internationally The Remuneration Committee may amend the SIP at any time in any respect. No amendment may be made to alter to the material disadvantage of any participant any rights already acquired by him without the consent of a majority of participants responding to any relevant request. The Remuneration Committee may establish further plans based on the SIP or add schedules to the SIP to allow the SIP to operate outside the UK, making appropriate amendments to take account of local securities, exchange controls or tax laws provided that any Ordinary Shares made available under such further plans or schedules are treated as counting against any limits on individual or overall participation in the main SIP.

(j) Limits on share capital available to the SIP An award may not be made under SIP if, as a result, the aggregate number of Ordinary Shares which have been or may be issued pursuant to awards or options granted in any period of ten years under the SIP or under any other employees’ share scheme adopted by Paysafe would exceed 10 per cent. of the issued ordinary share capital of Paysafe from time to time.

11.7 The principal terms of the Paysafe Sharesave Plan (the ‘‘Sharesave Plan’’) are summarised below:

(a) Outline The Sharesave Plan is an all employee plan under which employees may be invited to apply for options to acquire Ordinary Shares and is supervised by the Remuneration Committee. In the UK, the Sharesave Plan will operate within HMRC’s tax favoured regime for all-employee plans. The number of Ordinary Shares over which an option is granted is determined by the amount which the employee commits to save under a savings contract. This cannot exceed £500 per month or such other level as speciﬁed by HMRC from time to time.

(b) Eligibility All Executive Directors and all employees of the Company and any participating subsidiaries will be eligible to participate in the Sharesave Plan. The Remuneration Committee may require individuals to have worked for a qualifying period before joining the Sharesave Plan.

(c) Grant and exercise of options Invitations for options are normally issued within 42 days of the announcement of the Company’s results for any period but may also be issued at other times if considered exceptional by the Remuneration Committee. The option price must not be less than 80 per cent. of the market value of an Ordinary Share calculated either as the price on the business day before the date of invitation or the average price over the three preceding business days. The savings contract may run over a period of three or ﬁve years and must not permit savings of more than £500 per month. Options are normally exercisable during the six months after the end of the savings contract.

(d) Leaving employment If an employee option holder leaves the Paysafe Group, his or her option will, except in certain limited circumstances, lapse. There are exceptions in the cases of death, injury or disability, redundancy, retirement, or the sale of the business or subsidiary for which the individual worked and in these cases options may be exercised with savings made before the option is exercised.

(e) Takeover, reconstruction and winding-up Options may generally be exercised early on a takeover, scheme of arrangement or winding-up to the extent that the linked savings made are sufﬁcient to fund the exercise, in which case the option will normally be exercisable for a period of up to six months. Alternatively, option holders may be allowed to exchange their options for options over shares in the acquiring company.

314 (f) Variation of Capital In the event of a variation of share capital, including a capitalisation issue or rights issue, or any consolidation, sub-division or reduction of capital of Paysafe, the Remuneration Committee may adjust the number of shares in Sharesave options and/or the option exercise price.

(g) Amendment and extension of the Sharesave Plan internationally The Remuneration Committee may amend the Sharesave Plan at any time in any respect. No amendment may be made to alter to the material disadvantage of any participant any rights already acquired by him without the consent of a majority of participants responding to any relevant request. The Remuneration Committee may establish further plans based on the Sharesave Plan or add schedules to the Sharesave Plan to allow the Sharesave Plan to operate outside the UK, making appropriate amendments to take account of local securities, exchange controls or tax laws provided that any Ordinary Shares made available under such further plans or schedules are treated as counting against any limits on individual or overall participation in the main Sharesave Plan.

(h) Limits on share capital available to the Sharesave Plan An option may not be granted under the Sharesave Plan if, as a result, the aggregate number of Ordinary Shares which have been or may be issued pursuant to options or awards granted in any period of ten years under the Sharesave Plan or under any other employees’ share scheme adopted by Paysafe would exceed 10 per cent. of the issued ordinary share capital of Paysafe from time to time.

12. PROPERTY, PLANT AND EQUIPMENT The Paysafe Group has the following property interests: Purchase Price/Rent Major Property Location Tenure (exc. VAT) Term encumbrances 6 Finch Road, Douglas, Isle of Man Leasehold £3006.75 per 10 years None Isle of Man month plus expenses Part of Ground Floor, United Kingdom Leasehold 8 October 2013- 10 years Forms part of Compass House, Vision 8 April 2015: the security Park, Chivers Way, £98,940 p/a granted in Cambridge CB24 9AD From 8 April connection with 2015: £197,880 the Credit p/a Facilities 2nd Floor, 10 Albemarle United Kingdom Leasehold £75,075 p/a 10 years Forms part of Street, London, W1 the security granted in connection with the Credit Facilities 5th Floor, 10 Albemarle United Kingdom Leasehold £72,360 p/a 5 years Forms part of Street, London, W1 the security granted in connection with the Credit Facilities Floor 27, 25 Canada United Kingdom Leasehold £ 496,317.50 p/ 10 years with Forms part of Square London, E14 a (premises) tenant only the security 5LQ and car parking and £2,500 p/a break on the 3rd granted in licence (car parking and 5th connection with space) anniversary of the Credit the lease start Facilities 65 Capital East United Kingdom Leasehold GBP 1,200 per 1 year with 6 Forms part of Apartments 13-17 month month break the security Western Gateway clause granted in London E16 1AS connection with the Credit Facilities

315 Purchase Price/Rent Major Property Location Tenure (exc. VAT) Term encumbrances

Flat 15 Lumina Building United Kingdom Leasehold GBP 1,906.67 1 year Forms part of 29 Prestons Road per month the security London E14 9SU granted in connection with the Credit Facilities Flat 101 Naxos Building United Kingdom Leasehold GBP 2,080 per 1 year Forms part of 4 Hutchings Street month the security London E14 8LE granted in connection with the Credit Facilities Canalside 7, part of United Kingdom Leasehold GBP 27,000 per Indefinite, 3 Forms part of Clarence Mill, annum month notice the security Macclesfeld granted in connection with the Credit Facilities Third Floor Counting United Kingdom Leasehold GBP 334,090 10 years with Forms part of House, Hays Galleria, excluding VAT break after 5 the security 51-57 Tooley Street, and service years granted in London Bridge, City charge connection with the Credit Facilities 4th floor, Euro Plaza, A- Austria Leasehold Office lease 1: Office lease 1: None 1120 Vienna, Am Euro EUR 16,133.92 2,930,67 sqm Platz 2 Gebaüde plus EUR 1,521 indefinite period including car parking for parking with 12 months’ lots spaces plus notice, 1,144 operating sqm expenses and VAT 5 year term End of with early Office lease 2: termination right EUR 39,215 after 2 years 9 plus month subject EUR 2,328.25 to a 12- month for parking notice period spaces plus operating Office lease 2: expenses and indefinite period VAT with 12 month notice Office levels 4, 5 and 6 Bulgaria Leasehold EUR 48,493.10 5 years None and parking lots, 7-11 per month km Tsarigradsko Shose (premises) and Blvd, Sofia EUR 6,000 per month (parking lots) plus VAT App. 3, Cherkovna 60, Bulgaria Leasehold EUR 1,000 per Indefinite, 1 None Sofia month month notice App. 9, Cherkovna 60, Bulgaria Leasehold EUR 1,000 per Indefinite, 1 None Sofia month month notice Various Offices and Bulgaria Leasehold EUR143,532.42 3 years None Parking, Office Building p/a B, Sopharma Business Towers, Sofia, 5 Luchezar Stanchev Str. 215 – 16th St. S.E. Canada Leasehold C$ 723,589.20 5 years None Calgary, Alberta, T2E p/a (extension term 7P5 of 5 years) 2nd and 3rd Floors, 75 Canada Leasehold C$123,216 p/a Rolling month to None Promanade du Portage, month Hull, Quebec. 80 Queen Street, suite Canada Leasehold C$150,361.64 4 years with an None 602, Montreal, Quebec, option to renew H3C 2N5. for an additional 5 years

316 Purchase Price/Rent Major Property Location Tenure (exc. VAT) Term encumbrances

Various office suites and Canada Leasehold C$729,540.43, 5 years None storage space, 2 Place p/a Alexis Nihon 3500, de Maisonneuve Boulevard West, Montreal. 1st floor, CityQuartier Germany Leasehold EUR 5,499,18 Indefinite period None DomAquareé, Karl- plus VAT (3 months’ Liebknecht-Str. 5, monthly base notice period on Berlin-Mitte rent a quarterly basis) Allersberger Strasse Germany Leasehold EUR 701.27 per Indefinite period None 185, Gebaeude F, 1. month (3 months’ OG, Einheit 4019, notice period) 90461 Nuremberg 7th floor, Ko¨nigsallee Germany Leasehold EUR 2,875 plus Automatically None 66, 40212 Du¨sseldorf VAT monthly renewed for base rent terms of 1 year unless terminated by either party with six month notice 307 and 406 Atlantic Gibraltar Leasehold £1,900 per 1 year after Forms part of Suites, Europort month initial term the security indefinite with granted in three month connection with notice period the Credit Facilities 43/F, AIA Tower, 183 Hong Kong Serviced office HK$25,380 per Initial period of None Electric Road, North month 6 months, Point, Hong Kong thereafter 3 month notice Kv Bocken 39, Sweden Leasehold SEK 576,144 3 years after None Kungsgatan 7, per annum initial term to Stockholm 30 September 2017 D4 Business Center Switzerland Leasehold Original rent – 5 years None Luzern, 6039 Root CHF 9,982.80 La¨ngenbold per annum (excluding taxes and service charge) 28th Floor, 40 Wall USA License USD7,000.00 Automatically None Street, New York, per month renewed for NY10005 terms of 1 year unless terminated by either party Suite 1600, 2600 USA Leasehold $47,058.75 per 84 months and None Michelson Drive, Irvine, month extension California option of 60 months 11835 West Olympic USA Leasehold $8,115.75 3 years, 1 None Boulevard, Suite 650E, monthly (3% month Los Angeles, California, increase per 90064 annum) 61 Broadway, NYC USA Leasehold $120,000 per 5 years and 3 None annum months 3235 Satellite Blvd, Bldg USA Serviced office US$2,508 per Indefinite, 3 None 400, Suite 300, Duluth, month month notice Georgia, 30096

13. LITIGATION Save as set out below, there are no governmental, legal or arbitration proceedings (including any such proceedings which are pending or threatened of which the Company is aware) during the 12 months preceding the date of this document which may have, or have had in the recent past a significant effect on the Company’s and/or the Paysafe Group’s financial position or profitability.

317 Skrill Limited Skrill Limited has renegotiated super-agent contracts over the course of the last 24 months to new contractual terms and one contract remains unresolved. The super-agent (‘‘HG’’) issued proceedings against Skrill Limited in the Commercial Court, London on 16 December 2014 and has claimed that he is currently owed the sum of at least $1.5 million and that he will be entitled to receive an additional sum of no less than $2.5 million per annum on a lifetime basis (or an unspecified amount of damages in reflection of this sum). The super-agent is also seeking to recover damages for loss of earnings and legal costs and tax payments which together are estimated at approximately $900,000. Skrill Limited filed an acknowledgment of service on 2 January 2015. HG filed particulars of claim on 23 January 2015 and is seeking a declaration from the court confirming his position in respect of the proceedings. Skrill Limited filed a defence to the claim on 20 February 2015 and served a request for further information on HG, asking HG to provide clarification of some of the statements made in his particulars of claim.

Skrill Limited and HG entered into an agreement on 14 June 2012 for the referral of VIP Customers to the Skrill Group (the ‘‘Referral Agreement’’). Initially this agreement provided for commission to be paid by Skrill Limited to HG at a ﬂat rate of 20 per cent. The rate of commission was subsequently increased to 25 per cent. on 4 March 2013, 30 per cent. on 10 April 2013 and 35 per cent. on 10 July 2013.

In April 2013 the parties entered into discussions to enter into a new agreement (the ‘‘Super- Agent Agreement’’) which would reward HG with a tiered commission according to revenue generated through the referral of other ambassadors to Skrill Limited. The Super-Agent Agreement was signed on 9 August 2013. The Super-Agent Agreement entitled HG to commission at a rate ranging from 35 per cent. to 50 per cent. depending on revenue generated. A new Referral Agreement was not signed.

Skrill Limited and HG dispute the terms of the Super-Agent Agreement and the rate of commission due to HG. HG asserts that, whilst on its face, the Super-Agent Agreement only applies to the referral of sub-ambassadors (being other agents who would refer customers to the Skrill Group) by HG to Skrill Limited, the parties intended for the agreement to also cover the direct referral of VIP Customers. HG therefore claims that commission for this direct referral should be due at the higher level of 50 per cent. Skrill Limited maintains that the agreement reﬂects the intent of the parties and this does not include commission for the direct referral of VIP Customers.

In Q2 2015, following a mediation meeting, Skrill Limited made a Part 36 Offer to HG conceding liability with respect to HG’s claim, accepting HG’s assertion in relation to the terms of the Super-Agent Agreement and agreeing to pay the historic commission as requested by HG. The offer was accepted by HG on 12 June 2015. Skrill Limited also settled the claim for consequential losses, with a payment of US$172,552.31 being made to HG on 5 August 2015. On 7 August 2015, Skrill Limited also made a payment of US$796,130 which represented the historic commission payable to HG. On 11 September 2015, Skrill Limited made a further payment of US$85,990 representing the commission due to HG in respect of the transactions made by non-VIP customers.

Settlement discussions are ongoing. The dispute has not affected commercial activities between Skrill Limited and HG as at the date of this document. The Paysafe Group has provided e491,910 as a contingent liability in connection with the dispute as at 30 November 2015.

Ukash Ukash entered into an issuing agreement with a Canadian distributor (‘‘PVI’’) on 17 July 2008, under which PVI was engaged to distribute Ukash vouchers in Canada (the ‘‘Issuing Agreement’’). Following completion of the acquisition of Ukash by the Skrill Group on 31 May 2015, Ukash sought to terminate the Issuing Agreement in line with the provisions of the Issuing Agreement. PVI has subsequently threatened legal proceedings against Ukash, Skrill Limited and Paysafe alleging, amongst other things, breach of the Issuing Agreement by virtue of its early termination. No formal proceedings have been commenced, however PVI has quantiﬁed its damages claim at a minimum of C$10 million.

318 The potential claim is in its early stages and Paysafe has appointed legal counsel to advise on the merits of the claim. As at the date of this document, initial discussions with PVI are ongoing. However, the Paysafe Group does not believe that the potential claim is meritorious and intends to defend any formal proceedings initiated by PVI. Daily Fantasy Sports Class Actions On 18 November 2015 and 21 November 2015 a Paysafe Group entity was named in putative class action complaints filed in federal courts in New York and Florida, respectively, in relation to two daily fantasy sports operators. The two cases name a broad spectrum of defendants beyond the two operators, including banks, payment processors and investors in the operators. The complaints assert claims of unjust enrichment, civil racketeering and, in the case of the class action filed in Florida, civil conspiracy, and have been brought on behalf of players who have patronised the two daily fantasy sports sites. The claims essentially share the same bases alleging that the named financial institutions, by enabling the DFS operators to accept payment from customers, participated in an unlawful conspiracy with those DFS operators and thereby earned proceeds from that activity that is recoverable under one of the heads of claim set out above. It is not possible currently for Paysafe to determine the quantum of potential liability under either of the class actions because the claims are in their early stages and the correct Paysafe entity has yet to be formally served. Paysafe has appointed legal counsel to advise them as to the merits of the claims and on whether in each case a joint defence of each claim with the other named defendants would be appropriate.

14. MATERIAL CONTRACTS Sponsor’s Agreement The Company and the Sponsor entered into the Sponsor’s Agreement on 18 December 2015. Pursuant to the terms and conditions contained in the Sponsor’s Agreement, the Company has appointed the Sponsor as sponsor in connection with Admission. The obligations of the Sponsor under the Sponsor’s Agreement are subject to certain conditions being satisfied and the Sponsor has the ability, on giving notice to the Company, to terminate the Sponsor’s Agreement in certain specific circumstances, in each case, that are customary for an agreement of this nature. If the Sponsor’s termination right is exercised, then each party’s further rights, obligations and liabilities under the Sponsor’s Agreement shall cease immediately on termination, except for certain rights, obligations and liabilities as set out in the Sponsor’s Agreement. The Sponsor’s Agreement provides for the payment of a corporate finance fee by the Company to the Sponsor plus its legal and all other expenses incidental to Admission (in each case plus VAT where applicable). The Company has given customary warranties and undertakings to the Sponsor and has agreed to indemnify the Sponsor against certain liabilities. The Company has further agreed that, between the date of the Sponsor’s Agreement and the date falling 90 days after the date of Admission, it will not, without first consulting with the Sponsor, enter into a Relevant Transaction (as defined in the Sponsor’s Agreement) or any transaction having the same economic effect as any Relevant Transaction.

Agreement with the Largest Merchant Paysafe Merchant Services Limited (‘‘PMS’’) entered into a services agreement with the Largest Merchant on 13 November 2015 pursuant to which the Paysafe Group provides the Largest Merchant with certain payment processing services through its Asia Gateway service. The Paysafe Group, amongst other services, facilitates the transfer of payments between the Largest Merchant and its customers. This agreement superseded and replaced the services agreement between PMS and the Largest Merchant that was dated 22 April 2010. Each party has provided certain representations and warranties to the other conﬁrming, amongst other things, that each party has full power and authority to perform its obligations under the agreement. The Largest Merchant has warranted that it has authority to use, and PMS has warranted that it has the authority to make available: (a) the online electronic payment system that allows merchants to collect payments from customers via, inter alia, payment cards (the ‘‘System’’) and (b) the services that are provided by PMS to the Largest Merchant that are ancillary to or support the System, (together (a) and (b) being, the

319 ‘‘Service’’). Each party has further warranted that it will comply with specialist legal advice with respect to compliance with applicable laws, statutes and regulations in its use or provision of the Service. The Largest Merchant has warranted to PMS that it will not receive or transfer funds, nor otherwise use the Merchant Account(s) (as defined in the agreement) in connection with any illegal, fraudulent or deceptive activity, including but not limited to money laundering and terrorist financing. The Largest Merchant has indemnified PMS and its third party service provider (the ‘‘Service Provider’’) in respect of any illegal use of the Service. PMS has warranted to the Largest Merchant that it owns all intellectual property rights necessary for the provision of the Service. PMS has indemnified the Largest Merchant in respect of any third party claim against the Largest Merchant that it is breaching that third party’s intellectual property rights by using the Service in accordance with the agreement. Each party has indemnified the other in connection with the indemnifying party’s failure to comply with the terms of the agreement. As a contractual obligation of the agreement, PMS requires that it shall not be liable for any losses arising out of or in respect of, amongst other things, any action taken by a regulatory, governmental or enforcement authority in relation to the subject matter of the agreement, any act or omission of the Service Provider or the failure, interruption, infiltration or corruption of any hardware, software or other telecommunications or data transmission systems. The Largest Merchant is not liable for any losses arising out of or in respect of a force majeure event, PMS or Service Provider error or any act or omission of the Service Provider. The agreement can be terminated by either party providing not less than six months’ notice in writing to the other party. Each party may also terminate the agreement immediately without notice if the other is in breach of its obligations, representations and warranties under the agreement or for any business, security or fraud prevention purposes as determined by the party in question in its absolute discretion. PMS is also able to terminate the agreement immediately without notice if the Largest Merchant does not access the Merchant Account for a period of twelve months. The agreement is governed by the laws of the Isle of Man.

Amendment to Meritus Acquisition On 23 July 2015, NBX Services Corp. (‘‘NBX Services’’) and NETBX Services LLC (‘‘NETBX Services’’), both Paysafe Group companies, entered into an amendment agreement to the purchase agreement dated 1 July 2014 to acquire all of the partnership interests of Meritus (the ‘‘Meritus Amendment Agreement’’). Pursuant to the Meritus Amendment Agreement, the total number of Ordinary Shares to be issued to the sellers and certain other parties increased from 8,954,621 to 12,841,600, subject to any further adjustment based on the prevailing Ordinary Share price at the time the Ordinary Shares are to be issued by the Company. The Meritus Amendment Agreement also revises the dates of issuance of the four equal tranches of Ordinary Shares which have been changed from 23 July each year to 1 September 2015, 1 September 2016, 1 September 2017 and 3 September 2018, and the reference price for determining whether or not the recipients are entitled to additional consideration has been changed from £3.93 to £2.75 such that additional consideration would be payable in cash or Ordinary Shares if the price of the Ordinary Shares falls below 80 per cent. of the reference price.

FANS Acquisition On 22 May 2015, Paysafe ExchangeCo Inc. (previously Optimal Payments ExchangeCo Inc.) entered into an agreement (the ‘‘FANS Acquisition Agreement’’) with Benoit Fredette, 8542864 Canada Inc., 9204-1797 Que´bec Inc., Fre´de´ric Gascon, Venkata Subramanian Ganesan, Derek Pangia and Alexandre Beaulieu to buy the entire issued share capital of FANS Entertainment Inc. (‘‘FANS’’), a company incorporated in Canada. The total consideration payable was C$16,000,000 (approximately US$13,000,000), to be paid to the sellers by issuing shares in Paysafe ExchangeCo Inc. (the ‘‘FANS Consideration Shares’’). The FANS Consideration Shares are exchangeable into shares of the Company over a period of three years from the date of the FANS Acquisition Agreement, subject to the satisfaction of certain ﬁnancial performance criteria speciﬁed in the FANS Acquisition Agreement. A total of 3,163,633 FANS Consideration Shares were issued to the sellers.

320 As part of the FANS Acquisition, the sellers gave customary representations and warranties as to, among other things, their capacity to enter into the agreement, the purchased shares, the due incorporation of and other business matters relating to FANS, compliance with laws and tax compliance. These warranties are subject to customary limitations of liability which limit the maximum aggregate liability of the sellers to C$3,000,000, with the liability of each individual seller being limited to that seller’s pro rata share of the purchase price, multiplied by 0.1875. Paysafe ExchangeCo Inc. has the beneﬁt of the warranties given by the sellers for a period of 18 months or, in relation to warranties regarding tax, until six months after the expiration of the period during which any tax assessment may be issued by a governmental entity in respect of any taxation year to which the warranties extend. The FANS Acquisition completed on 22 May 2015.

Skrill Acquisition On 23 March 2015, the Company and Netinvest Limited (a wholly owned subsidiary of the Company) and Sentinel Group Holdings S.A. entered into an agreement to purchase the entire issued share capital of Sentinel Topco Limited (the ‘‘Skrill Acquisition Agreement’’). The Company has agreed to irrevocably and unconditionally guarantee the obligations of Netinvest Limited under the terms of the Skrill Acquisition Agreement. The Skrill Acquisition completed on 10 August 2015. Pursuant to the Skrill Acquisition Agreement, the consideration payable for the acquisition of the shares in Sentinel Topco Limited is equal to e855 million (payable in cash and shares). The cash consideration shall be settled by way of a direct payment to Sentinel Group Holdings S.A. and the redemption of loan notes held by Sentinel Group Holdings S.A. The cash payment shall be equal to e720 million less: * the aggregate fees of Sentinel Group Holdings S.A. and the Skrill Group (and the other direct and indirect shareholders) incurred in respect of the transaction and 50 per cent. of the fees incurred in respect of the transfer of Skrill USA Inc.; and * an amount equal to the principal outstanding amount of loan notes issued by Sentinel Holdco 2 Limited (Sentinel Topco Limited immediate subsidiary) to Sentinel Group Holdings S.A., which was e240,055,202.11 (the ‘‘Redemption Amount’’), (‘‘Cash Consideration’’). At Completion, Netinvest Limited paid Sentinel Group Holdings S.A. the Cash Consideration and the Redemption Amount, and procured repayment of the Skrill Group’s net debt (which was approximately e247 million including all amounts outstanding under the Skrill Group Senior Facilities Agreement). In addition, the Company issued 37,493,053 Ordinary Shares (the ‘‘Skrill Consideration Shares’’) to Sentinel Group Holdings S.A. which amounted to approximately 7.9 per cent. of the share capital of the Company following Completion and which together had a value of e135 million based upon the theoretical ex-rights price of the Rights Issue. The enterprise value at Completion was approximately e1.1 billion. Prior to Completion, the Skrill Group completed an intra-group restructuring to transfer Skrill USA Inc. outside the Skrill Group to Sentinel Group Holdings S.A. Paysafe has commenced the process for obtaining the required approvals in connection with Skrill USA Inc.’s money transmitter licences from the relevant US states or territories in order for the Paysafe Group to be able to acquire Skrill USA Inc. and has received regulatory approvals from most of the relevant US states and territories. The transfer of Skrill USA Inc. to Sentinel Group Holdings S.A. was carried out at market value and the consideration (which was e5.2 million) was left outstanding as a loan between Skrill Holdings Limited and Sentinel Group Holdings S.A. In addition, Skrill Holding Limited also provided Skrill USA Inc. with a funding loan for working capital purposes. Assuming that the required approvals are received in a timely fashion, Skrill Holdings Limited will repurchase Skrill USA Inc. on receipt of the relevant approvals and the consideration for that transfer will be the release of Sentinel Group Holdings S.A.’s obligation to repay the e5.2 million loan owed to Skrill Holdings Limited (and therefore Skrill Holdings Limited will not be required to raise any funds to ﬁnance the acquisition). Sentinel Group Holdings S.A. has agreed that it will not sell Skrill USA Inc. to a third party for a period of six months after Completion. If Skrill Holdings Limited has not obtained the relevant approvals to enable Skrill USA Inc. to be transferred to Skrill Holdings Limited within

321 the six month period following Completion, Sentinel Group Holdings S.A. shall be permitted to sell Skrill USA Inc. to a third party. In the event Skrill USA Inc. is sold to a third party, Sentinel Group Holdings S.A. will use reasonable endeavours to sell Skrill USA Inc. for the best possible purchase price, and the proceeds of that sale shall be used to repay the loans put in place between Skrill Holdings Limited and both Sentinel Group Holdings S.A. and Skrill USA Inc., and any excess loan amount that remains outstanding (whether relating to the working capital loan or the consideration for the transfer of Skrill USA Inc.) shall be waived by Skrill Holdings Limited. Sentinel Group Holdings S.A. provided limited warranties in connection with the Skrill Acquisition to Netinvest Limited. These warranties are, among others, as to the capacity of Sentinel Group Holdings S.A to enter into the Skrill Acquisition Agreement, that Sentinel Group Holdings S.A. is not insolvent and that it is the sole beneficial owner of the shares in Sentinel Topco Limited that it will sell to Netinvest Limited pursuant to the Skrill Acquisition Agreement. Netinvest Limited has the benefit of the warranties until the first anniversary of the Skrill Acquisition Agreement. The liability of Sentinel Group Holdings S.A. to Netinvest Limited under the Skrill Acquisition Agreement, save in relation to leakage where recovery is on a e for e basis, shall not exceed the consideration received by Sentinel Group Holdings S.A. under the Skrill Acquisition Agreement. Certain members of the Skrill Group’s senior management have entered into a warranty deed and provided the Company with customary business warranties relating to Sentinel Topco Limited and its subsidiary undertakings and in relation to the accuracy of the information in the March 2015 Prospectus relating to the Skrill Group and its subsidiary undertakings. The liability of the warrantors under the warranty deed is several and is limited to 30 per cent. of the cash consideration received by the warrantors in connection with the sale of Sentinel Topco Limited, which was approximately e3.6 million. The Company and Netinvest Limited have provided warranties in connection with the Skrill Acquisition to Sentinel Group Holdings S.A. These warranties relate principally to compliance with laws in certain key jurisdictions and the information in this document being true and accurate in all material respects, and are subject to the same limitations (including aggregate cap on liability) as the limitations in the warranty deed. The Skrill Acquisition Agreement was amended on 22 July 2015 in order to make consequential non-material changes resulting from the decision (taken for operational reasons) to carry out the transfer of Skrill USA Inc. outside the Skrill Group earlier than originally planned, together with a small number of other non-material changes.

Lock-Up Agreement The Company, Canaccord Genuity Limited, Deutsche Bank AG, London Branch, BMO Capital Limited, and Sentinel Group Holdings S.A. entered into the Lock-Up Agreement on 10 August 2015 pursuant to which Sentinel Group Holdings S.A. undertook to the Company and Canaccord Genuity Limited, Deutsche Bank AG, London Branch and BMO Capital Limited (together, the ‘‘Rights Issue Underwriters’’) that it would not without the consent of the Rights Issue Underwriters, for a period of 180 days from the date of Completion, directly or indirectly, offer, issue, lend, mortgage, assign, charge, pledge, sell or contract to sell, issue options in respect of, or otherwise dispose of, directly or indirectly, or announce an offering or issue of, any Ordinary Shares (or any interest therein or in respect of such Ordinary Shares) or any other securities exchangeable for or convertible into, or substantially similar to, Ordinary Shares or enter into any transaction with the same economic effect as, or agree to do, any of the foregoing subject to certain limited exceptions set out in the Lock-Up Agreement, including, inter alia, the right to transfer Ordinary Shares to any connected persons, the right to accept a general offer made in accordance with the Takeover Code and the right to take up any rights granted in respect of a rights issue or other pre-emptive share offering by the Company. During the 180 day lock-up period, Sentinel Group Holdings S.A. (and any shareholder who subsequently holds shares in accordance with the Lock-Up Agreement) had the right to transfer the Ordinary Shares to connected persons (as deﬁned in the Corporation Tax Act 2010 including certain CVC Funds entities), provided that the transferee enters into a deed of adherence agreeing to be bound by the terms of the Lock-Up Agreement.

322 During the six month period following the end of the 180 day lock-up period Sentinel Group Holdings S.A. was required to give notice prior to disposing of shares and to carry out any disposal through an agreed list of brokers, so as to ensure an orderly market in the Ordinary Shares. In respect of a proposed disposal to a strategic investor, Sentinel Group Holdings S.A. was required to give at least ﬁve Business Days prior notice to the Rights Issue Underwriters and the Company and in respect of all other disposals, Sentinel Group Holdings S.A. was required to give notice to at least one of the Rights Issue Underwriters and the Company not later than 12.00 p.m. on the day prior to the disposal, in each case giving details of the identity of the proposed purchaser. The notice requirements in respect of disposals (other than disposals to strategic investors) did not apply in the event that the disposal was of less than 3 per cent. of the total Ordinary Shares or Sentinel Group Holdings S.A. (and the CVC Funds entities it was permitted to transfer shares to) held in aggregate less than 3 per cent. of the total Ordinary Shares. The Company agreed to consider any request by Sentinel Group Holdings S.A. to dispose of Ordinary Shares during the 180 lock- up period in good faith and, if appropriate, to provide Sentinel Group Holdings S.A. with such assistance as it might reasonably request in seeking the consent of the Rights Issue Underwriters. The same provisions applied, as relevant, to any person to whom Skrill Consideration Shares are issued. On 11 December 2015 it was announced that entities owned by certain funds advised by afﬁliates of CVC Capital Partners SICAV-FIS S.A. have (with the consent of the Rights Issue Underwriters) disposed of their entire holding of Ordinary Shares in the Company.

Underwriting Agreement A summary of the Underwriting Agreement can be found on pages 505 to 506 of the March 2015 Prospectus and is incorporated by reference into this document.

Credit Facilities On 23 March 2015, Paysafe entered into a senior facilities agreement (the ‘‘SFA’’) between, amongst others, Paysafe as Parent, Netinvest Limited as Borrower, Paysafe Finance Limited as Guarantor, BMO Capital Markets, Barclays Bank PLC and Deutsche Bank Luxembourg S.A. as Arrangers and Barclays Bank PLC as Agent and Security Agent. Pursuant to the terms of the SFA, the lenders under the SFA provided facilities (the ‘‘Credit Facilities’’) in order, amongst other things, to part finance the Skrill Acquisition. The terms of the Credit Facilities were amended on 30 June 2015. The Credit Facilities comprise: (a) an amortising Facility A term loan of e280,000,000 with a final repayment date of 10 August 2020; (b) a bullet Facility B term loan of e220,000,000 with a final repayment date of 10 August 2022; and (c) a revolving credit facility (‘‘RCF’’) of US$85,000,000 with an expiry date of 10 August 2020. In addition, Paysafe may request the establishing of one or more incremental facilities under the SFA provided that adjusted leverage, assuming full utilisation of such facility, would not exceed 2.75:1. The establishing of an incremental facility is subject to the agreement of lenders to lend under such facility. Facility A and Facility B were made available for the purpose of part financing the Skrill Acquisition and related costs. The RCF is made available for the purpose of financing costs related to the Skrill Acquisition and for general corporate purposes of the Paysafe Group, including the financing of permitted acquisitions and joint ventures. Facility A carries a margin of EURIBOR plus 3 per cent. per annum and Facility B carries a margin of EURIBOR plus 4 per cent. per annum, in both cases reducing in line with reductions in adjusted leverage. The RCF carries a commitment fee of 35 per cent. of applicable margin and a margin of 2.75 per cent. per annum, again reducing in line with reductions in adjusted leverage. Paysafe has taken out an interest rate swap for Facility A to hedge against the risk of interest rates increasing.

323 Paysafe is required to ensure that subsidiaries comprising not less than 85 per cent. of the Paysafe Group by EBITDA, and each subsidiary representing 5 per cent. or more of the Paysafe Group EBITDA, become guarantors under the SFA (excluding entities that are unable to accede for regulatory reasons). Paysafe Group companies party to the SFA will, subject to agreed exclusions, grant security over all their property, assets and undertaking to secure their liabilities under the SFA. The SFA contains customary representations and warranties, information covenants and general undertakings, including but not limited to restrictions on creation of further security, disposals and the incurrence of further financial indebtedness. The SFA also prohibits the payment of dividends to Paysafe by its subsidiaries (subject to certain exceptions) if adjusted leverage is in excess of 3.25:1. The SFA further requires that Paysafe comply with adjusted leverage and fixed charge cover financial covenants. In the event of the Ordinary Shares in Paysafe ceasing to be listed or traded on a recognised investment exchange, or any person or persons acting in concert gaining control of more than 30 per cent. of the share capital of Paysafe, Paysafe ceasing to own 100 per cent. of the share capital in Netinvest, or a sale of all or substantially all the assets of the Paysafe Group, the Credit Facilities will become repayable. The Credit Facilities will also become repayable upon failure to comply with the warranties and covenants given in the SFA, and upon certain other customary events of default.

Mauritius Acquisition A summary of the Mauritius Acquisition can be found on page 504 of the March 2015 Prospectus and is incorporated by reference into this document.

Meritus Acquisition and GMA Acquisition (the ‘‘US Acquisitions’’) A summary of the US Acquisitions can be found on pages 504 to 505 of the March 2015 Prospectus and is incorporated by reference into this document.

Ukash Acquisition A summary of the Ukash Acquisition can be found on page 513 of the March 2015 Prospectus and is incorporated by reference into this document. The Ukash Acquisition completed on 31 March 2015.

Skrill Senior Facilities Agreement A summary of the Skrill Senior Facilities Agreement can be found on pages 514 to 515 of the March 2015 Prospectus and is incorporated by reference into this document.

Share Sale and Purchase Agreement in respect of the Skrill Group A summary of the 2013 share sale and purchase agreement in respect of the Skrill Group can be found on pages 513 to 514 of the March 2015 Prospectus and is incorporated by reference into this document.

15. RELATED PARTY TRANSACTIONS 15.1 Paysafe Group Save as disclosed below or as disclosed in the financial information for the financial years ended 31 December 2012, 2013 and 2014 which is incorporated by reference into this document and the six months ended 30 June 2015 in Section B of Part IV (Financial Information of the Paysafe Group) of this document, neither the Company nor any member of the Paysafe Group has entered into any related party transactions with any related party during the financial years ended 31 December 2012, 2013 and 2014, in the six month period ended on 30 June 2015 and during the period between 30 June 2015 and the Latest Practicable Date. During the period from 1 January 2015 to the Latest Practicable Date, the Company entered into one related party transaction. On 23 March 2015, Old Mutual Global Investors entered into an agreement with the Rights Issue Underwriters to sub-underwrite the issue of 34,812,065 of the new Ordinary Shares issued pursuant to the Rights Issue. Old Mutual

324 Global Investors received the same commission as all other sub-underwriters (1.25 per cent.) in respect of such number of new Ordinary Shares for which it subscribed pursuant to the sub-underwriting arrangement.

15.2 Skrill Group Other than as disclosed in the financial information for the financial years ended 31 December 2012 and 2013 which is incorporated by reference into this document, the financial year ended 31 December 2014 in Part VI (Financial Information of the Skrill Group) of this document and for the six months ended 30 June 2015 in Section B of Part VI (Financial Information of the Skrill Group) of this document, neither Skrill Group Limited nor any member of the Skrill Group (including Sentinel Topco Limited in respect of the period ended 31 December 2014 and the six month period ended 30 June 2015) has entered into any related party transactions with any related party during the financial years ended 31 December 2012, 2013 and 2014, in the six month period ended on 30 June 2015 and during the period between 30 June 2015 and 10 August 2015.

16. WORKING CAPITAL The Company is of the opinion that the working capital available to the Paysafe Group, after taking into account its available bank facilities under the Credit Facilities, is sufﬁcient for its present requirements, that is, for at least 12 months following the date of publication of this document.

17. SIGNIFICANT CHANGE 17.1 Paysafe Group Save as disclosed below, there has been no significant change in the trading or financial position of the Paysafe Group since 30 June 2015, the end of the last financial period of the Paysafe Group for which financial information was prepared. The Paysafe Group acquired the entire issued share capital of Skrill on 10 August 2015 for approximately e1.1 billion.

17.2 Skrill Group There has been no significant change in the trading or financial position of the Skrill Group since 30 June 2015, the end of the last financial period of the Skrill Group for which financial information was prepared.

18. CONSENTS The auditors and reporting accountants of the Company are KPMG Audit LLC. KPMG Audit LLC has given and has not withdrawn its consent to the inclusion in this document of its Accountant’s Reports in Section A of Part IV (Financial Information of the Paysafe Group), Section A of Part VI (Financial Information of the Skrill Group), Section C of Part VI (Financial Information of the Skrill Group), Section E of Part VI (Financial Information of the Skrill Group) and Section A of Part VII (Unaudited Pro Forma Financial Information) of this document in the form and context in which they appear and has authorised the contents of those reports for the purposes of paragraph 5.5.3(2)(f) of the Prospectus Rules.

19. DOCUMENTS AVAILABLE FOR INSPECTION Copies of the following documents will be available for inspection during normal business hours on any weekday (Saturdays and public holidays excepted) at the registered office of the Company at Audax House, 6 Finch Road, Douglas, Isle of Man, IM1 2PT and at the offices of Hogan Lovells International LLP at Atlantic House, Holborn Viaduct, London, EC1A 2FG, United Kingdom until Admission: (a) the March 2015 Prospectus; (b) the Articles of Association; (c) the annual reports and accounts of the Paysafe Group for the three financial years ended 31 December 2012, 2013 and 2014 and the reported on financial information of the Paysafe Group for the six month period ended on 30 June 2015;

325 (d) the audited accounts of TK Global Partners, LP for the three financial years ended 31 December 2012, 2013 and 2014; (e) the audited accounts of the Skrill Group Limited for the four financial years ended 31 December 2011, 2012, 2013 and 2014 and the reported on financial information of the Skrill Group for the six month period ended on 30 June 2015; (f) the audited accounts of paysafecard for the three financial years ended 31 December 2011, 31 December 2012 and 31 December 2013; (g) the Accountant’s Report prepared by KPMG Audit LLC on the historical financial information on Paysafe Group set out in Part A of Part IV (Financial Information of the Paysafe Group) of this document; (h) the Accountant’s Report prepared by KPMG Audit LLC on the historical financial information on TK Global Partners, LP set out in Part C of Part IV (Financial Information of the Paysafe Group) of this document; (i) the Accountant’s Report prepared by KPMG Audit LLC on the historical financial information on Sentinel Topco Limited set out in Part A of Part VI (Financial Information of the Skrill Group) of this document; (j) the Accountant’s Report prepared by KPMG Audit LLC on the historical financial information on Skrill Group Limited set out in Part C of Part VI (Financial Information of the Skrill Group) of this document; (k) the Accountant’s Report prepared by KPMG Audit LLC on the historical financial information on Skrill Group Limited set out in Part E of Part VI (Financial Information of the Skrill Group) of this document; (l) the Accountant’s Report prepared by KPMG Audit LLC on the unaudited pro forma financial information set out in Part A of Part VII (Unaudited Pro Forma Financial Information) of this document; (m) the consent letters referred to in paragraph 18 of this Part XI (Additional Information); and (n) this document. Copies of this document are also available for inspection at the National Storage Mechanism at http://www.morningstar.co.uk//uk/nsm. In addition this document will be published in electronic form and available on the Company’s website at www.paysafe.com.

326 PART XII

INFORMATION INCORPORATED BY REFERENCE

The table below sets out the information from the March 2015 Prospectus which is incorporated by reference into, and forms part of, this document and which is available for inspection as set out in paragraph 19 of Part XI (Additional Information) of this document. Any non-incorporated parts of the March 2015 Prospectus are either not relevant for the investor or covered elsewhere in this document.

Page numbers of such Document Sections sections

March 2015 Prospectus Part VI (Online Gambling Regulation) 138 to 150 March 2015 Prospectus Part VIII (Operating and Financial Review of the 160 to 176 Optimal Payments Group) March 2015 Prospectus Part IX (Financial Information on the Optimal 177 to 218 Payments Group) March 2015 Prospectus Part XI (Financial Information on the Skrill 238 to 451 Operating Group) March 2015 Prospectus Part XVI (Additional Information) describing 481 to 483 movements in the issued share capital of the Company during the financial years ended 31 December 2012, 31 December 2013, 31 December 2014 and the period between 1 January 2015 and 20 March 2015 March 2015 Prospectus Part XVI (Additional Information) describing the 483 to 489 provisions of the Memorandum and Articles of Association of Optimal Payments March 2015 Prospectus Part XVI (Additional Information) summarising 504 to 515 certain material contracts of the Paysafe Group Information that is itself incorporated by reference in the above documents is not incorporated by reference into this document. Any statement contained in a document which is deemed to be incorporated by reference herein shall be deemed to be modified or superseded for the purpose of this document to the extent that a statement contained herein (or in a later document which is incorporated by reference herein) modifies or supersedes such earlier statement (whether expressly, by implication or otherwise). Any statement so modified or superseded for the purpose of this document shall not be deemed, except as so modified or superseded, to constitute a part of this document. Copies of the March 2015 Prospectus are also available for inspection at the National Storage Mechanism at http://www.morningstar.co.uk//uk/nsm. In addition the March 2015 Prospectus is published in electronic form and available on the Company’s website at www.paysafe.com.

327 PART XIII

DEFINITIONS

The definitions set out below apply throughout this document, unless the context requires otherwise. ‘‘Acts’’ the Companies Acts 1931 – 2004 of the Isle of Man; ‘‘active customers’’ in respect of the Paysafe Group, means those customers who have transacted using a Paysafe Group product within the preceding 12 months and in respect of the Skrill Group means those customers who have transacted using a Skrill Group product within the preceding 12 months; ‘‘active merchants’’ in respect of the Paysafe Group, means those merchants who have transacted using a Paysafe Group product within the preceding 12 months and in respect of the Skrill Group means those merchants who have transacted using a Skrill Group product within the preceding 12 months; ‘‘Admission’’ admission of the Ordinary Shares to the premium listing segment of the Official List and to trading on the Main Market; ‘‘AIM’’ the market of that name operated by the London Stock Exchange; ‘‘Approved Plan’’ the Paysafe Approved Share Option Plan described in paragraph 11.3 of Part XI (Additional Information) of this document; ‘‘Articles of Association’’ or the articles of association of the Company; ‘‘Articles’’ ‘‘Asia Gateway service’’ the service described in paragraph 5 of Part I; ‘‘Audit Committee’’ the audit committee of the Board which currently comprises of Ian Francis, Andrew Dark and Brahm Gelfand; ‘‘BIN’’ bank identification number; ‘‘Board’’ the board of directors of the Company from time to time; ‘‘Business Day’’ any day on which banks are generally open in London for the transaction of business other than a Saturday or Sunday or public holiday; ‘‘CAGR’’ compound annual growth rate; ‘‘CGT’’ capital gains tax or corporation tax on chargeable gains (as applicable); ‘‘CIE’’ Caesar’s Interactive Entertainment Inc.; ‘‘City Code’’ or the UK City Code on Takeovers and Acquisitions; ‘‘Takeover Code’’ ‘‘CJEU’’ Court of Justice of the European Union; ‘‘Commission’’ the European Commission of the EU; ‘‘Completion’’ completion of the Skrill Acquisition on 10 August 2015, in accordance with the terms of the Skrill Acquisition Agreement, as amended; ‘‘Credit Facilities’’ the credit facility agreements of the Paysafe Group summarised in paragraph 14 of Part XI (Additional Information) of this document; ‘‘CVC’’ (i) the CVC Funds and (ii) the general partners, managers and investment advisers of the CVC Funds and their respective employees, officers, partners, agents and consultants;

328 ‘‘CVC Funds’’ CVC European Equity Partners V (A) L.P., CVC European Equity Partners V (B) L.P., CVC European Equity Partners V (C) L.P., CVC European Equity Partners V (D) L.P., and CVC European Equity Partners V (E) L.P.; ‘‘DDoS’’ a distributed denial-of-service attack, being an attempt to make a network resource unavailable to its intended users; ‘‘Deferred Shares’’ deferred shares of £0.01 each in the capital of the Company; ‘‘Deutsche Bank’’ Deutsche Bank AG, London Branch; ‘‘Directors’’ the directors of the Company at the date of this document and ‘‘Director’’ means one of the Directors as the context applies; ‘‘Disclosure and Transparency the disclosure and transparency rules made by the UK Listing Rules’’ Authority under Part VI of FSMA (as set out in the FCA Handbook), as amended; ‘‘DPA’’ the deferred prosecution agreement entered into by Paysafe and the USAO in 2007; ‘‘EBITDA’’ earnings before taxation, net ﬁnancing costs, depreciation and amortisation; ‘‘EDoS’’ an economic denial of sustainability attack, being an attempt to make computing unsustainable by targeting the economic resources of a network operator; ‘‘EEA’’ the European Economic Area; ‘‘Electronic Money Directive’’ Directive 2000/46/EC on the taking up, pursuit of and prudential supervision of the business of electronic money institutions; ‘‘Electronic Money Regulations’’ the UK Electronic Money Regulations 2011 (S.I. 2011/99); ‘‘EPS’’ earnings per share; ‘‘EU’’ the European Union; ‘‘EU Data Protection proposed regulation on the protection of individuals with regard to Regulation’’ the processing of personal data and on the free movement of such data; ‘‘euro’’ or ‘‘g’’ the single currency of the member states of the European Union that adopt or have adopted the euro as their lawful currency under the Treaty on the Functioning of the European Union; ‘‘Euroclear’’ Euroclear & Ireland Limited; ‘‘Excluded Territories’’ the United States, Canada, Australia, Japan, New Zealand, South Africa and any other jurisdiction where local laws or regulations may result in a signiﬁcant risk of civil, regulatory or criminal exposure for the Company if information or documents concerning Admission were to be sent or made available to Shareholders in that jurisdiction; ‘‘Executive Directors’’ the executive directors of the Company from time to time, which at the date of this document are Joel Leonoff and Brian McArthur- Muscroft; ‘‘Exchange Act’’ the United States Securities Exchange Act of 1934, as amended; ‘‘FANS’’ FANS Entertainment Inc.; ‘‘FANS Acquisition’’ the acquisition of FANS Entertainment Inc. by Paysafe ExchangeCo Inc. (previously Optimal Payments ExchangeCo Inc.); ‘‘FCA’’ or ‘‘Financial Conduct the Financial Conduct Authority of the United Kingdom or any Authority’’ predecessor or successor body or bodies carrying out the functions currently carried out by the Financial Conduct Authority; ‘‘FSMA’’ the Financial Services and Markets Act 2000, as amended;

329 ‘‘FY2013’’ the financial year ended 31 December 2013; ‘‘FY2014’’ the financial year ended 31 December 2014; ‘‘FY2015’’ the financial year ended 31 December 2015; ‘‘FY2016’’ the financial year ended 31 December 2016; ‘‘FY2018’’ the financial year ended 31 December 2018; ‘‘Gambling Act’’ the Gambling Act 2005 of the UK; ‘‘General Meeting’’ the extraordinary general meeting of the Company held on 28 September 2015; ‘‘GMA Acquisition’’ the acquisition of the trade and assets of Global Merchant Advisors, Inc. by Paysafe; ‘‘H1 2014’’ the six months ended 30 June 2014; ‘‘H1 2015’’ the six months ended 30 June 2015; ‘‘HGC’’ the Hellenic Gaming Commission; ‘‘HMRC’’ HM Revenue & Customs; ‘‘Hot-Standby’’ the capability to run queries on a database that is currently performing archive recovery; ‘‘IFRS’’ International Financial Reporting Standards as adopted for use by the EU; ‘‘IRS’’ US Internal Revenue Service; ‘‘IVC Funds’’ Investcorp Technology Partners III, L.P., Investcorp Technology Partners III (Cayman), L.P., Investcorp Technology Ventures II, L.P. (Delaware) and Investcorp Technology Ventures II, L.P. (Cayman Islands); ‘‘KYC’’ know your customer, being the due diligence that financial institutions, regulated entities and other persons are required to perform to identify their clients and ascertain relevant information pertinent to doing financial business with them; ‘‘Largest Merchant’’ the largest merchant of the Paysafe Group, being collectively, various entities trading as bet365; ‘‘Latest Practicable Date’’ 17 December 2015, being the latest practicable date prior to publication of this document; ‘‘Lazard’’ Lazard & Co., Limited; ‘‘Listing Rules’’ the listing rules made under Part VI of FSMA (as set out in the FCA Handbook), as amended; ‘‘London Stock Exchange’’ London Stock Exchange plc or its successor(s); ‘‘LTIP’’ or ‘‘Long Term Incentive the Paysafe Long Term Inventive Plan described in paragraph Plan’’ 11.4 of Part XI (Additional Information) of this document; ‘‘Main Market’’ the main market for listed securities of the London Stock Exchange; ‘‘March 2015 Prospectus’’ the prospectus published by the Company on 23 March 2015; ‘‘Mauritius Acquisition’’ the acquisition of Petal Payments Limited (now known as Optimal Payments Merchant Services (Mauritius) Limited); ‘‘Member State’’ member state of the EU; ‘‘Meritus Acquisition’’ the acquisition of TK Global Partners, LP by Paysafe; ‘‘Meritus Amendment the agreement entered into on 23 July 2015 between NBX Agreement’’ Services Corp., NETBX Services LLC and various individual sellers; ‘‘Meritus Payment Solutions’’ the trading name of TK Global Partners, LP; ‘‘Moody’s’’ Moody’s Investors Service Limited;

330 ‘‘Money Laundering the Money Laundering Regulations 2007, as amended; Regulations’’ ‘‘NETELLERâ Account’’ refers to an online stored value account opened with the Paysafe Group’s NETELLERâ stored value business; ‘‘New Articles’’ the new articles of association of the Company to be adopted at the General Meeting, conditional on Admission; ‘‘Nomination Committee’’ the nomination committee of the Board which currently comprises of Dennis Jones, Andrew Dark and Ian Francis; ‘‘Non-Executive Directors’’ the non-executive directors of the Company from time to time, which at the date of this document are Dennis Jones, Andrew Dark, Ian Francis, Brahm Gelfand and Ian Jenks; ‘‘NPA’’ the non-prosecution agreement entered into by Optimal Payments Group Inc. and the USAO dated 29 October 2009; ‘‘Ofﬁcial List’’ the list maintained by the FCA for purposes of section 79(1) of FMSA; ‘‘Ordinary Shares’’ ordinary shares of £0.0001 each in the capital of the Company; ‘‘Overseas Shareholders’’ shareholders with registered addresses outside the United Kingdom or the Isle of Man or which are incorporated in, registered in or otherwise resident or located in, countries outside the United Kingdom and the Isle of Man; ‘‘Paysafe’’ or ‘‘the Company’’ Paysafe Group plc; ‘‘Paysafe Employee Share the Plan, the Approved Plan, the LTIP, the SIP and the Plans’’ Sharesave Plan; ‘‘Paysafe Group’’ or ‘‘the Group’’ the Company together with its subsidiaries and subsidiary undertakings; ‘‘PD Amending Directive’’ Directive 2010/73/EU of the European Parliament and of the Council; ‘‘PCI DSS’’ Payment Card Industry Data Security Standards; ‘‘Plan’’ the Paysafe Share Option Plan described in paragraph 11.2 of Part XI (Additional Information) of this document; ‘‘PoS’’ point of sale; ‘‘Pounds’’ or ‘‘£’’ or ‘‘Pounds the lawful currency of the United Kingdom; Sterling’’ ‘‘PRA’’ the UK Prudential Regulation Authority; ‘‘Prospectus Directive regulation number 809/2004 of the European Commission, as Regulation’’ amended; ‘‘Prospectus Rules’’ the prospectus rules made under Part VI of FSMA (as set out in the FCA Handbook), as amended; ‘‘Prospectus’’ or ‘‘this this document dated 18 December 2015, comprising a document’’ prospectus for the purposes of the Prospectus Rules (together with any supplements or amendments thereto); ‘‘Prospectus Directive’’ Directive 2003/71/EU of the European Parliament and the Council of the EU on the prospectus to be published when securities are to be offered to the public or admitted to trading, as amended (including pursuant to the PD Amending Directive): ‘‘PSP’’ payment service provider; ‘‘P2P’’ Peer-to-Peer; ‘‘Regulation S’’ Regulation S under the US Securities Act; ‘‘Regulatory Information one of the regulatory information services authorised by the UK Service’’ or ‘‘RIS’’ Listing Authority to receive, process and disseminate regulatory information from listed companies;

331 ‘‘Remuneration Committee’’ the remuneration committee of the Board which currently comprises of Ian Jenks, Andrew Dark and Brahm Gelfand; ‘‘Renminbi’’ or ‘‘RMB’’ the lawful currency of the People’s Republic of China; ‘‘Resolutions’’ the resolutions to be proposed at the General Meeting; ‘‘Rights Issue’’ the issue of 272,495,506 Ordinary Shares pursuant to a rights issue as set out in the March 2015 Prospectus; ‘‘Rights Issue Underwriters’’ Canaccord Genuity Limited, Deutsche Bank AG, London Branch and BMO Capital Limited; ‘‘Sabemul’’ Sabemul Beteiligungsverwaltungs GmbH; ‘‘Second Electronic Money Directive 2009/110/EC on the on the taking up, pursuit and Directive’’ prudential supervision of the business of electronic money institutions; ‘‘Senior Managers’’ or ‘‘Senior the senior managers of the Company from time to time, which at Management’’ the date of this document are Danny Chazonoff and Elliott Wiseman; ‘‘Sentinel Shareholder’’ any direct shareholder as at 23 March 2015 in Sentinel Group Holdings S.A., any direct shareholder in those shareholders, CVC and the IVC Funds; ‘‘Shareholders’’ a holder of Ordinary Shares; ‘‘Sharesave Plan’’ the Paysafe Sharesave Plan as described in paragraph 11.7 of Part XI (Additional Information) of this document; ‘‘SIP’’ the Paysafe Share Incentive Plan as described in paragraph 11.6 of Part XI (Additional Information) of this document; ‘‘Skrill’’ Sentinel Topco Limited; ‘‘Skrill Acquisition’’ the acquisition of Sentinel Topco Limited by Netinvest Limited pursuant to the Skrill Acquisition Agreement; ‘‘Skrill Acquisition Agreement’’ the agreement entered into on 23 March 2015 between Paysafe Group plc, Netinvest Limited and Sentinel Group Holdings S.A., as amended on 22 July 2015; ‘‘Skrill Consideration Shares’’ the 37,493,053 Ordinary Shares issued to Sentinel Group Holdings S.A. as consideration pursuant to the terms of the Skrill Acquisition Agreement; ‘‘Skrill Directors’’ the directors of Skrill at the date of this document and ‘‘Skrill director’’ means any one of them; ‘‘Skrill Operating Group’’ Skrill Group Limited, together with its subsidiaries and subsidiary undertakings; ‘‘Skrill Group’’ Skrill, together with its subsidiaries and subsidiary undertakings; ‘‘Skrill Senior Facilities the senior facilities agreement dated 16 August 2013 and Agreement’’ amended and restated by an amendment and restatement agreement dated 29 January 2014 between Sentinel Midco Limited, Sentinel Bidco Limited, Credit Suisse AG, London Branch, Jefferies Finance LLC and The Royal Bank of Scotland Plc as described on pages 514 to 515 of the March 2015 Prospectus and incorporated by reference into this document; ‘‘Skrill Shareholder’’ any Sentinel Shareholder or any connected person (as deﬁned in section 1122 of the Corporation Tax Act 2010) of Sentinel Group Holdings S.A. or of any Sentinel Shareholder; ‘‘Sponsor’’ Deutsche Bank AG, London Branch; ‘‘Sponsor’s Agreement’’ the agreement between the Company and Deutsche Bank AG, London Branch dated 18 December 2015; ‘‘Standard & Poor’s’’ Standard & Poor’s Credit Market Services Europe Limited;

332 ‘‘STP’’ straight through processing; ‘‘subsidiary undertaking’’ has the meaning given in section 1162 of the UK Companies Act; ‘‘subsidiary’’ has the meaning given in section 1159 of the UK Companies Act; ‘‘TFEU’’ Treaty on the Functioning of the European Union; ‘‘UK Companies Act’’ the UK Companies Act 2006, as amended, modiﬁed or re- enacted from time to time; ‘‘UK Listing Authority’’ or the Financial Conduct Authority acting in its capacity as the ‘‘UKLA’’ competent authority for the purposes of FSMA; ‘‘Ukash’’ Smart Voucher Limited; ‘‘Ukash Acquisition’’ the acquisition of Smart Voucher Limited by Sabemul; ‘‘United Kingdom’’ or ‘‘UK’’ the United Kingdom of Great Britain and Northern Ireland; ‘‘US’’ or ‘‘United States’’ the United States of America, its territories and possessions, any state of the United States and the District of Columbia; ‘‘US Acquisitions’’ the Meritus Acquisition and the GMA Acquisition; ‘‘USAO’’ the United States Attorney for the Southern District of New York; ‘‘US Person’’ has ascribed to it by Regulation S under the US Securities Act; ‘‘US Securities Act’’ the United States US Securities Act of 1933, as amended; ‘‘US$’’, ‘‘US dollars’’ or ‘‘$’’ the lawful currency of the United States; ‘‘VAT’’ applicable value added tax; ‘‘VIP Customer’’ refers to important end customers transacting high volumes through the stored value platforms; ‘‘VoIP’’ Voice Over internet Protocol; and ‘‘Wire Act’’ the Interstate Wire Act 1961, a US federal law.

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