Update re. CVA shares and other matters

30 April 2025

Electric Guitar PLC

("Electric Guitar" or the "Company")

Corporate update, update on the issue of CVA Shares and issue of warrants to directors

Total voting rights

Corporate update

The Board of Electric Guitar (LSE: ELEG) is actively considering several potential acquisition targets, having been presented with a number of opportunities, the most promising being in the energy and AI sectors. Further announcements will be made in due course.

Update on the issue of CVA Shares

Electric Guitar also provides an update regarding the forthcoming issue and admission to trading on AIM of the fixed number of 236,782,175 new ordinary shares of 0.01 pence (the "CVA Shares") for the settlement of creditors pursuant to the Company Voluntary Arrangement ("CVA"), as announced on 27 March 2025.

The Supervisor of the CVA is continuing to process creditor claims and calculate the allocation of each creditor claim to the fixed number of CVA Shares and, accordingly, the CVA Shares have not yet been issued and allotted. A further announcement will be made in due course once this is completed and to confirm the expected date for the CVA Shares to be admitted to trading on AIM. In addition, as also announced on 27 March 2025, up to 306,665,817 new ordinary shares of 0.01 pence ("Ordinary Shares") are also expected to be issued at that time pursuant to the conversion of loan notes.

Issue of warrants to directors

The Company continues to preserve cash with the directors not having drawn their contracted fees or salaries. In particular, Richard Horwood and Sarfraz Munshi have spent significant unremunerated time on the Company's recent CVA and fundraising and, since their respective appointments, to administer the Company's affairs and accelerate the execution of the Company's current strategy.

In light of the above, the Board of the Company has agreed to issue, in aggregate, 100,000,000 warrants to subscribe for new Ordinary Shares (the "Warrants") to Mr Horwood and Mr Munshi on the following terms, to align their interests with those of all the shareholders, and to compensate them for their unremunerated work:

* £0.001 represents 2.9x the recent subscription fundraising price of £0.00034 and 2x yesterday's mid-market closing market price of £0.0005

**£0.0015 represents 4.4x the recent subscription fundraising price and 3x yesterday's mid-market closing market price of £0.0005.

The Warrants cannot be exercised if it would cause either of the directors (and those deemed to be acting in concert with him) to be interested in more than 29.99% of the issued share capital and total voting rights of the Company at any time.

The issue of the Warrants to Mr Horwood and Mr Munshi are deemed related party transactions pursuant to Rule 13 of the AIM Rules for Companies. Accordingly, Grahame Cook, the independent director for the purposes of these transactions, considers, having consulted with the Company's nominated adviser, that the terms of the transactions are fair and reasonable insofar as the Company's shareholders are concerned.

Total voting rights

The Company announces that the issued share capital of the Company at the date of this announcement comprises 1,200,293,699 Ordinary Shares with one voting right per share. The Company does not hold any Ordinary Shares in treasury. Therefore, the total number of Ordinary Shares and voting rights in the Company is 1,200,293,699.

This figure may be used by shareholders in the Company as the denominator for the calculations by which they will determine if they are required to notify their interest in, or a change to their interest in, the share capital of the Company under the FCA's Disclosure Guidance and Transparency Rules.

For further information:

Notification and public disclosure of transactions by persons discharging managerial responsibilities and persons closely associated with them