EFTA01100540.pdf

Ei ri,lit Confidential Private Placement Memorandum EFTA01100540 Confidential Private Placement Memorandum relating to Class A Shares of 0.1p in Eric Wright Fashion Management Limited ("Class A Shares") THIS DOCUMENT IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION. If you are in any doubt about the action you should take or the contents of this document you should consult a person authorised under the Financial Services and Markets Act 2000 who specialises in advising on the acquisition of shares and other securities. The content of this document ("Document') has been prepared by Eric Wright Fashion Management Limited ("EWFML" or the "Company) and has not been approved by an authorised person within the meaning of the Financial Services and Markets Act 2000. Reliance on this Document for the purpose of engaging in any investment activity may expose an individual to a significant risk of losing all of the property a other assets invested. The Document (which is for information purposes only) Is made available on the express understanding that it will only be used by the recipient for the sole purpose of assisting the recipient in deciding whether it wishes to pro- ceed with a further investigation of the Company. The Document is not intended to form the basis of any investment decision or other evaluation or any decision to purchase shares and should not be considered as a recommen- dation by the Company to any recipient of the Document to invest in the Company. Each person to whom this Document is made available must make his or her own independent assessment of the Company after making such investigation as he or the may deem necessary in order to determine whether to proceed with any part purchase. The Document does not constitute an offer or invitation for the sale or purchase of any shares or any interest therein, nor does it constitute the basis of any contract which may be concluded in respect of such shares or interest and any purchaser must rely solely on the terms and conditions contained In such a contract. While the information contained in the Document is believed to be accurate. it has not been independently verified by the Company or any other party and the Company nor any of its respective directors, officers or employees makes any representation or warranty (expressed or implied) nor accepts any responsibility as to or in relation to the accuracy or completeness of the information or any analysis and conclusions drawn from such information or any opinions contained in the Document or any other written or oral information made available to any interested party or its advisers (and no one is authorised to do so on behalf of any of them) and no responsibility or liability is accepted for the accuracy or sufficiency of any of the information, opinions or projections. for any errors. omissions or mis•statements. negligent or otherwise, or for any communication. written or otherwise. made to anyone in the Document in connection with the investigation of the Company. In particular, but without prejudice to the generality of the foregoing. no representation or warranty is given as to the achievement or reasonableness of any future projections. estimates, prospects or returns contained in the Document Accordingly, the Company nor any other of its respective officers, servants, or agents. nor its advisers shall be liable for any direct, indirect or consequential loss or damage suffered by any person as a result of relying on any statement or omission in the Document or in any future communications in connection with such proposed partial disposal, save to the extent that liability is specifically accepted under any agreement. In providing the Document. the Company undertakes no obligation to accept any offer, to provide the recipient with access to any additional information which may be provided or to correct any inaccuracies therein which may be provided or to correct any inaccuracies which may become apparent and expressly reserve the right. without advance notice and in any respect, to change the procedure for the proposed investment opportunity or to terminate negotiations at any time. The issue of the Document will not be taken as any form of commitment on the part of the Company to proceed with any transaction. The share capital of the Company is not at present included in the official UK list maintained by the Financial Services Authority as the UK Listing Authority. It is not intended that any application will be made for shares of the Company to be traded on any market. A prospective Investor should be aware of the risks of investing and should make the decision to Invest only after careful consideration and. if appropriate. consultation with an independent financial adviser authorised under the Financial Services and Markets Act 2000 who specialises in advising on the acquisition of shares and other securities. The distribution of this document in certain jurisdictions may be restricted by law and, accordingly, persons into whose possession this document comes should inform themselves about and observe any such restrictions. My failure to comply with any such restrictions may constitute a violation of the securities laws of the jurisdiction concerned. This document does not constitute or form part of any offer to sell or an invitation to subscribe for, or the solicitation of an offer to buy or to subscribe for, shares in any jurisdiction in which such an offer or solicitation is unlawful. In particular, the Class A Shares have not been and will not be registered under the US Securities Act of 1933 (as amended) (the 'Securities Act"), or under any state securities laws in the United States or under the applicable securities laws of Australia. Canada or Japan. Accordingly. subject to certain exceptions. the Class A Shares may not, directly or indirectly. be offered or sold within the United States. Australia. Canada or Japan or for the account of US Persons (as defined in the Securities Act) and this document will not be posted to any person in the United States. Australia. Canada or Japan. This Document includes statements that are, or may be deemed to be. "forward-looking statements". These forward•looking statements can be identified by the use of forward-looking terminology, including the terms "believes". "estimates". "anticipates". "expects". "intends". "may". "will" or "should" or, in each case. their negative or other variations or comparable terminology. These forward•looking statements relate to matters that are not historical facts. They appear in a number of places throughout this Document and include statements regarding the intentions. beliefs or current expectations of the Company and the Directors. By their nature. forward-looking statements involve risks and uncertainties because they relate to events and depend on circumstances that may or may not occur in the future. Forward-looking statements are not guarantees of future performance. There are a number of factors that could cause actual results and developments to differ materially from those expressed a implied by these fonvard•looking statements. These factors include, but are not limited to. changes in general economic condi- tions, legislative or regulatory changes, changes in taxation regimes, the Company's ability to manage its assets and the availability and cost of capital for future investments. Potential Applicants are advised to read this Document in its entirety, and, in particular, the section of this Document entitled "Risk Factors" for a further discussion of the factors that could affect the Company's future performan- ce. In light of these risks, uncertainties and assumptions, the events described in the forward-looking statements in this Document may not occur or may not occur as foreseen. These forward•looking statements speak only as at the date of this Document. Subject to its legal and regulatory obligations, the Company expressly disclaims any obligations to update or revise any forward-looking statement contained herein to reflect any change in expectations with regard thereto or any change In events, conditions a circumstances on which any statement is based. EFTA01100541 This Document has been provided to you solely for your information and may not be reproduced or redistributed, in whole or in part, to any other person. The information contained in this Document has not been approved for the purposes of Section 21(2) of the Financial Services & Markets Act 2000 of the United Kingdom ("FSMA"). As such this Document is being distributed only to persons falling within the categories of exempt person described in the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005. as amended. (the "Order") or pursuant to any applicable exemption under FSMA (together "relevant persons'), including (but not limited to) (a) "certified high net worth individuals" within the meaning of article 48 of the Order: (b) "certified sophisticated investors" within the meaning of article 50 of the Order: (c) "self•certified sophisticated investors' within the meaning of article 50A of the Order: (d) "high net worth companies, unincorporated associations, partnerships or trustees of high value trusts' within the meaning of article 49 of the Order; and (e) "investment professionals" within the meaning of article 19 of the Order. My person who is not a relevant person should not act or rely on this Document or any of its contents. In order to qualify as a Certified High Net Worth Individual you must have signed, within the last 12 months, a Statement in the terms set out in Part I of Schedule 5 of the Order to the effect that: (a) you are a Certified High Net Worth Individual for the purposes of the Order; (b) you understand that this means that you can receive financial promotions that may not have been approved by a person authorised by the Financial Services Authority, that the content of such financial promotions may not conform to rules issued by the Financial Services Authority. and that by signing the Statement you may lose significant rights, you may have no rights to complain to the Financial Services Authority or the Financial Ombudsman Scheme and you may have no right to seek compensation from the Financial Services Compensation Scheme; (c) you are a Certified High Net Worth Individual because at least one of the following applies:(i) you had. during the financial year immediately preceding the date on which the Statement is signed. an annual income of not less than £100.000: or (h) you held. throughout the financial year immediately preceding the date on which the Statement is signed. net assets to the value of not less than £250,000; and KO you accept that you can lose property and other assets from making investment decisions based on financial promotions and that it is open to you to seek advice from someone who specialises in advising on shares in unlisted companies. Where this Document is issued to a Certified High Net Worth Individual, it is exempt from the restriction in Section 21 of the FSMA on the communication of invitations or inducements to engage in investment activity on the ground that it is made to a Certified High Net Worth Individual, for the purposes of article 48 of the Order. In order to qualify as a Certified Sophisticated Investor you must have a certificate signed by a person authorised by the Financial Services Authority to the effect that you are significantly knowledgeable to under stand the risks associated with certain types of investments and you must have signed within the last 12 months a Statement in the terms set out in Article 50(1)(b) of the Order. Where this Document is issued to a Certified Sophisticated Inves- tor. it is exempt from the restriction in Section 21 of the FSMA on the communication of invitations or inducements to engage in investment activity on the ground that it is made to a Certified Sophisticated Investor, of the purposes of article 50 of the Order. By virtue of Article 50(3) of the Order, we are required to wam you that any reliance on this communication could potentially expose you to a significant risk of losing all of the property invested or incurring additional liability. If you are in any doubt about the investment to which this Document relates, you should consult an authorised person specializing in advising on securities of the kind described in this Document. In order to qualify as a Sed•Certified Sophisticated Investor you must have signed within the last 12 months a Statement in the terms set out in Part II of Schedule 5 of the Order to the effect that: (a) you are a Self•Certified Sophisticated Investor for the purposes of the Order; (b) you understand that this means that you can receive financial promotions that may not have been approved by a person authorised by the Financial Services Authority. that the content of such financial promotions may not conform to rules issued by the Financial Services Authority. and that by signing the Statement you may lose significant rights, you may have no rights to complain to the Financial Services Authority or the Financial Ombudsman Scheme and you may have no right to seek compensation from the Financial Services Compensation Scheme; (c) you are a Self•Certified Sophisticated Investor because at least one of the following applies: (i) you are a member of a network or syndicate of business angels and have been so for at least the last six months prior to the date of the Statement: (I) you have made more than one investment in an unlisted company in the two years prior to the date of the Statement: (iii) you are working, or have worked in the two years prior to the date of the Statement. in a professional capacity in the private equity sector. or in the provision of finance for small and medium enterprises; (iv) you are currently, or have been in the two years prior to the date of the Statement, a director of a company with an annual turnover of at least £1 million; and (d) you accept that you can lose property and other assets from making investment decisions based on financial promotions and that it is open to you to seek advice from someone who specialises in advising on shares in unlisted companies. Where this Document is issued to a Self•Certified Sophisticated Investor, it is exempt from the restriction in Section 21 of the FSMA on the communication of invitations or inducements to engage in investment activity on the ground that it is made to a Self• Certified Sophisticated Investor, for the purposes of article 50A of the Order. June 2011 EFTA01100542  Table of Contents 1. Purpose and Strategy 2. Expected Timetable of Principal Events / Offer Statistics 3. Principal Terms relating to the Offer 4. Information on the Eric Wright Vision 5. Information on Eric Wright Fashion Strategy & Development 6. Intellectual Property Transfer to E W F M L 7. Information on Senior Management 8. Risk Factors and Disclosures 9. Advisers 10. The Offer EFTA01100543 1. Purpose and Strategy Purpose and Strategic Objective EWFML has been established to provide potential investors with an opportunity to invest in the fashion asset class. EWFML intends to pursue this strategic objective by securing all the intellectual property relating to Eric Wright, including, copyright, designs and trademarks and creating the Eric Wright brand and ancillary products including menswear and womenswear, leather accessories, watches and jewellery, eyewear, fra- grances, ties, bags and luggage. Background, Market Position & Opportunity Eric Wright is a leading fashion designer. He has worked in partnership with Karl Lagerfeld, acting as his right hand man, as well as for many of the fashion houses under Karl Lagerfeld's direction. These partnerships included; Lagerfeld, Lagerfeld Gallery, Chloe, Chanel (as Image Consultant), and Fendi (as Design Director). Sub- sequently, Eric has designed for Trussardi (menswear), Roberto Cavalli (menswear), and recently was the Creative Director for Faconnable and now creative consultant to Italian Independent. Eric Wright © is a label created and designed by Eric Wright ("EW"), an internationally renowned fashion designer and innovator. Eric Wright © is a menswear label focusing on collections comprised of clothing and accessories which bear Eric's hallmarks of quality, integrity, and vision. EWFML Investment Focus The focus will be on creating a new menswear brand with a fresh approach to the modern man's wardrobe. The philosophy is based on quality materials, craftsmanship and design. It is proposed that the collections will be sold worldwide through selected prestigious retailers, limited to between 20-30 outlets initially and then expanding to between 60- 90 within a target period of five years. Target retailers at this end of the market are aware of EW and many will have bought collections designed by him under many different well known labels. Initial research suggests that there will be a great deal of interest in the Eric Wright ©. The emphasis will therefore be on selecting the best retail partners in key territories. These stores will offer the widest representation of the product and promote the brand most effectively. There is a widespread awareness of EW's importance in the fashion industry and of the influence he has had on other labels as well as on those for whom he has designed. The brand's position is to nurture, sustain and strengthen this interest and translate it into exposure, establishing Eric Wright © within its target demographic and beyond. EFTA01100544 2. Expected Timetable of Principal Events / Offer Statistics Offer opens 7th June 2011 Offer closes When the Directors so determine, which is expected to be on or around 31st August 2011 Issue of share certificates 5 days following the Offer closing Offer Price £1.00 Number of Class A Shares in issue following the Offer (assuming full subscription) 3,502,000 Number of Class A Shares currently in issue 1,000 Number of Class A Shares, the subject of the Offer 3,501,000* Number of Class B Shares currently in issue 1,500,000 Gross proceeds receivable by the Company pursuant to the Offer (assuming full subscription) £4,000,000" Net proceeds of the Offer receivable by the Company (assuming full subscription) £3,500,000** * including £1 being subscribed by a third party investor for Class A Shares ** including £500,000 being subscribed by a third party investor for Class B Shares EFTA01100545 3. Principal Terms relating to the Offer This Section 3 sets out a summary of the principal terms of the Offer. Applicants are reminded that this is only a summary of the application form, the shareholders agreement and the articles of association of EWFML, copies of which are attached ("Offer Documents") and is sub- ject to the contents of the Offer Documents. It is intended solely as a guide and Applicants should also read the remaining provisions of this Memorandum, in particular the risk factors described in Section 7, the Offer Documents Applicants are invited to invest in Class A Shares. EWFML will be the holding company of Eric Wright Fashion Limited and Eric Wright Retail Limited. Eric Wright Fashion Limited will operate the brands, creative and wholesale businesses of EWFML group and Eric Wright Retail Limited will operate the retails business of the EWFML group. The intention of EWFML is to raise up to £3,000,000 in aggregate, net of costs and expenses by entering into commit- ments with Applicants to subscribe for Class A Shares for a consideration of up to £3,500,000 although the Directors of Offer the Company ("Directors") have the discretion to accept investments in excess of this amount. The Offer will close when the Directors determine that it has, which is currently expected to be on or about 31st August 2011. Above is a summary only of the terms of the Offer to Applicants. Please see the enclosed application form, sha- reholders agreement and articles of association, which set out the terms of the Offer in full. EFTA01100546  Class A Shares will be denominated in British £ and have a nominal value of 0.1p. Class A Shares will initially be non-voting but after 31st October 2016 will be voting. Class A Shares will be dividend bearing. With limited exceptions, applicants shall not be able to offer, sell, contract to sell, pledge, grant any option to purchase, make any short sale or otherwise dispose of any Class A Shares prior to 31st October 2016 without the consent of Rights Attaching to holders of the majority of Class B Shares. Class A Shares Thereafter, the holders of Class A Shares shall have rights of pre-emption in respect of the transfer of Class A Shares. Such rights of pre-emption shall firstly be for the benefit of the Applicants and secondly for the benefit of EW. The holders of Class A Shares between them shall have the right to appoint and maintain one individual (who must also be a holder of Class A Shares) to the board of EWFML. The Articles of Association contain "Tag Along" rights and "Drag Along" rights as follows: Rights Attaching to Drag Along Class B Shares In the event that the holders of more than 50% of the Class B Shares in issue wish to sell, transfer or dispose in any manner of all of their Class B Shares to a third party, other holders of Shares shall be obliged to sell, transfer or dispose of their Shares to that third party on the same terms. The holders of Class B Shares of 0.1p each in the capital of EWFML ("Class B Shares") between them shall have the right to appoint and maintain three individuals to the board of EWFML. The holders of Class B Shares between them shall have the right to no less than 25% of any dividends declared by the Board, no less than 25% on any liquidation of EWFML and no less than 25% of the consideration on any sale of EWFML. Rights attaching to TagAlong all Shares In the event that any shareholder intends to sell, transfer or dispose in any manner some or all of his Shares constituting more than 50% of the entire issued share capital of EWFML, other holders of Class A Shares shall be entitled to to sell the same proportion of the Class A Shares held by them on the same terms, if they wish to do so. Above is a summary only of the rights attaching to the Class A Shares and the Class B Shares. Please see the articles of association of EWFML, a copy of which is attached, which set out the rights attaching to the Class A Shares and Class B Shares in full. EWFML reserves the right to issue different classes of shares with different rights attaching to those shares as attach to the Class A Shares or Class B Shares. EFTA01100547  EW and Mehmet Aricioglu are the current executive directors of EWFML. EW is the design director and Mehmet Aricioglu is the general manager. Company It is not the current intention of EWFML to seek to have EWFML or Class A Shares listed on any stock exchange. EWFML's accounting reference date is currently 31 December. Intellectual Property / Subject to the closing of the Offer, EW shall transfer such intellectual property rights in and to his name as are speci- Eric Wright transfer of IP fied in Section 6 below to EWFML. i Each Applicant is urged to take professional advice from his/her legal, tax, and accounting advisers and other finan- Tax Aspects cial advisers concerning the consequences of acquiring, holding and disposing of Class A Shares. EFTA01100548 4. Information on the Eric Wright Vision It is the intention of the Directors of EWFML to build the company and brand into an international multi-million pound business. The concept for the Eric Wright © collection is to create the essential 'wardrobe' for the modern man. EW will present a focused collection of key garments and accessories representing an evolution of design and technical innovation. The intended use of each garment or item will reflect the lifestyle of the Eric Wright © target customer profile. This man could be described as: independent, discerning, discreet, elegant and self confident. EW intends to re-define his wardrobe for work, travel and leisure. EW has identified a gap in the market which falls between those brands offering an interpretation of classic styles in high quality fabrics, but with conservative shaping and detail (such as Loro Piana or Hermes) and those who present a modernist, avant garde concept where the focus is on aesthetics, form, and functionality. Eric Wright © will combine the quality and dignity of the classic luxury brands, with a fashion edge that relates to the modern man. The garments will be designed to flatter the wearer with a silhouette that appears made to measure, whilst the cut and fit should be consistent across a wide range of sizes. Throughout his career Eric Wright has applied his skills and experience to enhance the core characteristics of each brand he has designed for. He has also been able to interpret how best to develop these ideals in context with changing market and consumer trends (photographic images have been included in this document from collections designed by Eric Wright for Fendi, Trussardi, Roberto Cavalli, Faconnable). EW intends to create label with a unique blend of quality fabrication, craftsmanship and detailing to reflect his own values and the truest expres- sion of his ability. EW also intends to collaborate with specialised manufacturers, renowned in their field, to utilise their techniques to produce unique items under the Eric Wright © label. In summary, EW's business vision is to: • Develop a subtle, well crafted luxury brand that reflects Eric Wright's personal philosophy. • Deliver 'unique, high quality, desirable menswear' to the luxury retail market which competes alongside those of Dries Van Noten, Hermes, Bottega Veneta, Tom Ford. • Expand the Menswear and accessories collections and develop a diversified business incorporating retail and licensed product lines. EFTA01100549 5. Information on Eric Wright Fashion Strategy & Development EWFML's strategy is composed of two elemental development phases which will be carried out through its subsidiaries: Phase 1 - Autumn/Winter '2012-13 1. Present the first collection of Eric Wright © menswear to targeted high end fashion retailers in January 2012 in Paris. It is proposed that the collection will be offered on an exclusive basis to selected stores worldwide, scheduled for delivery in beginning July 2012. The concept is to present key, fundamental pieces for a man's wardrobe with a range of clothing and accessories of the highest quality and craftsmanship, all designed for a modern lifestyle. EW will retain control over the whole process choosing and developing special fabrics, sampling, production and he will directly oversee the technical staff on site in factories in Italy. The collection will be focused in terms of styles, reflecting the brand's core product philosophy. Each garment will reflect the key aspects of its intended use and will represent the ultimate culmination of modern design and production technique. The collection is expected to include: Suits, Jackets, Leather, Coats, Knitwear, Shirts, Ties, Trousers, Jeans, Shoes, Belts, Bags, and Gloves. 2. Initiate Distribution Strategy: limited distribution via select retailers within their respective geographical region(s), ensuring exclusivity to create public awareness of the brand as demand increases. 3. Bolster the brand's Media Image and Brand Identity: launch and introduce the Eric Wright © brand to the international fashion press and media. The media campaign will begin with the launch of an Eric Wright ©,<Teaser Campaign >> from October to December 2011 targeting key industry publications: i.e., WWD, DNR USA, Textile Wirschaft Germany, Journal du textile France, etc. Public Relations firm appointed to coordinate the press and media coverage for the launch of EWFML's premier fashion show in January 2012, during Paris Menswear Fashion Week. The media strategy will involve targeted coverage focusing initially on Eric Wright and then moving beyond to build the label's inherent identity and in turn name recognition and relationship with the customer. He has a unique story and fashion career that makes him particualry interes- ting to journalsts and editors. This planned approach will be time-line focused and developed to support wider strategic time sensitive events and international brand growth. EFTA01100550 4. Web presence: a web site will be launched in conjuncton with the initial collection.for Eric Wright O. This will be a marketing tool to generate interest in the label and not ecommerce enabled. Phase 2 Once the brand is established, both in terms of the wholesale account base and consumer awareness, there will be the opportunity to diversify the product range and to undertake a range of new business activities. The business plan is based on a 5 year period during which the brand is established globally. Growth from 2012 onwards will be through expansion of sales: 1. Wholesale distribution to the selective stores in Europe, USA, the Middle and Far East and Asia. 2. Direct Retail: stand alone flagship stores opening in July through September of 2012 in London and September 2013 in Paris. 3. E-commerce: internet sales operation will be based at the offset in the London store for U.K and the ROW. Once opened the Paris Store will proceed to take care of then Eurozone. 4. Retail Franchise: partnerships with retailers to open franchised stores worldwide. 5. Licensing: contracts will be negotiated with partner companies to manufacture and distribute a range of Eric Wright @ branded products, such as sunglasses, fragrances and watches. (EW has extensive experience of working with licensee partners). EFTA01100551 Suppliers EW's principal suppliers are the fabric suppliers and factories involved in the production of the collections. Factories need designers who can sell large volumes; they prefer designers who are experienced and respected within the industry. EW has built up strong personal relationships with many Italian factories. This relationship has been based upon EW's fastidious attention to detail/support of the factories in the production process, dedication/enthusiasm and openness. He is fluent in English, French and Italian and can communicate a high level of technical detail. International Wholesale Retailers EWFML intends to open a showroom in Paris in January and June of each year for international wholesale customers to view the collection and place orders. The following retail partners have been identified as potential partners: UK: Matches, Selfridges, Dover Street Market, Harvey Nichols, Browns. FRANCE: Collette, L'eclaireur, Le printemps, Bon Marche, Galerie Lafayette. SPAIN: Galery Madrid. ITALY: Trade, Corso Como, Luisa Via Roma, Diegli Effeti, Carl Sugar, Antonioli. GERMANY: Bungalow, Braun, Theresa, Ka De We, Engelhorn, The Corner, Quartier 121. IRELAND: Brown Thomas. SOUTH AFRICA: Fabiani. RUSSIA: Podium, Tsum. KAZAKHSTAN: Luxus. U.S: Barneys, Jeffery's, Bergdorfs. WEST COAST: Fred Segal (L.A.), Maxfield (L.A.), Wilkes Bashford, Louis Boston, Ultima. DUBAI: Al Ostura, Majed, Harvey Nichols. JAPAN: Hankyu, Isetan, Barneys, Mitsoukoshi. HONG KONG/ CHINA: Joyce, Lane Crawford. KOREA: Shinsegae, Hyun Dai, Galleria, Coex. SINGAPORE: Club 21. BANGKOK: Club 21. TAIWAN: Kaohsiung: Hon Shin, Mitsoukoshi. EFTA01100552 Web Presence The following URL domain name has been purchased on behalf of EWFML: Operations Base EWFML will be based in London, England. The following functions will be carried out in London; • General management • Marketing • Finance • Design • Assembly of Collection • Factory liaison and monitoring • Buying • Progressing stock schedules • Flagship Retail Store • Ecommerce Management Structure Eric Wright © has a strong management team, with complementary skills and a wealth of experience. Beyond the principal team members, a network of professionals can be called upon for specialist input. The team has been working together on the EW project for some months and has already developed a good understanding and is focused on their own roles as well as the goals and objectives set by EW. • Enc Wright @Managua learn agankram Sales Mai EFTA01100553 6. Intellectual Property Transfer to Eric Wright Fashion Management Limited By way of Deed, and conditional on the Minimum Raise being achieved by no later than 31st October 2011, EW will permit EWFML to apply for the registration of the trade mark "ERIC WRIGHT" in relation to fashion design anywhere in the world and will undertake not to oppose such applications. 7. Information on Senior Management Eric Wright (Aged 55) — Design Director An American with a European point of view — this is perhaps the best way to summarize the figure of Eric Wright. Both professionally and personally Eric's life has crossed both continents and their very different worlds. In America, fashion works to market demands, while in Europe the world of fashion offers opportunities to cultivate ideas and creativity. Fashion has always been the great constant in the life of EW. He began to draw his first sketches during his childhood in San Francisco — a great passion which led him to an internship with the costume designer EDITH HEAD in Hollywood. In the late '70's Eric moved to New York to study at the Parsons School, but his academic life was cut short with the chance to work at CARTIER, where Eric designed a small collection of home accessories. From Cartier, Eric moved on to SAKS 5th AVENUE to work as a stylist for national advertising for all of SAKS 35 locations, collaborating with artists and photographers including the likes of Michael Tighe and Patrick Demarchelier. His work here demonstrated Eric's extraordinary crea- tive abilities in the realm of fashion and later took him to Europe for the first time when he joined CERRUTI in 1978 as the Womenswear Design Assistant. From Cerruti's Paris and Milan offices Eric oversaw model castings and fittings for fashion shows. A longing to return home took Eric back to San Francisco where he worked for LEVI STRAUSS designing their sports collection for a period of two years. It was yet another experience that enriched his knowledge and understanding of product from inception to production. Upon returning to New York Eric worked with BILL KAISERMAN, one of the most acclaimed designers on the New York scene at that time, from whom he learned the art of cutting and tailoring. New York also provided Eric with enormous inspiration culturally and the influence of the era's music and art scene still resonates in his work today. In 1983 his name reached Karl Lagerfeld, who interviewed and hired Eric on the first day they met. His brief was to work together with him on his second line KL by Karl Lagerfeld. Eric was involved in every aspect; from design, to studio, the factory to the boutiques, becoming Karl's "eyes for America". This meeting and subsequent collaboration with Karl marked a pivotal moment in both Eric's life and career. "Working with Lagerfeld was an extraordinary experience and enriches you culturally. He has added a new vocabulary to the fashion world". EFTA01100554 This collaboration continued through to 1987 when Lagerfeld decided to work exclusively with Eric. Eric moved to Paris, becoming Karl's right hand man. There Eric worked on the creative development of all the lines, accessories, fashion shows, PR and publicity. Karl and Eric were an inseparable team and worked together on LAGERFELD, LAGERFELD GALLERY, CHLOE, CHANEL (as Image Consultant), and FENDI (as Design Director). With their many lines and wide range of projects Karl and Eric contributed to the establishment of new trends and imagery both in style and communication. Italy has always fascinated Eric, and in 1998 he moved to Rome to work solely on FENDI -a family business as Cerruti had been — "I was curious to discover a world that I didn't know, a new language". It was during his 7 year tenure in his role as design director that Eric found his greatest satisfaction. In 2000 he began working on FENDI's menswear collection, in that time producing the now FENDI collection spring/summer 2001 collaboration with artist Abigail Lane. It was at Fendi menswear that Eric found the greatest outlet to date for his creativity, an experience and period that today he considers to have been the greatest stimulus for challenging himself and his talents, the method and balance that allowed the greatest attention to both produc- tion and creative artistry. In 2005 Eric moved to London and was immediately called upon by TRUSSARDI in Milan where he was asked to develop a completely new image for the Trussardi man. Here, again, Eric enjoyed success and after two seasons was recruited by CAVALLI as their menswear Design Director. Eric returned to France in 2008 when FACONNABLE asked him to reinvent their interpretation of timeless elegance. His aim was to work in reinforcing the image of FACONNABLE while giving the label a new vitality. Having worked at the highest levels possible within the international world of fashion Eric wanted to reach further heights and achieve new le- vels of creativity with his work. To this end EWFML has been founded. Out of Eric Wright ©, Eric himself hopes will come his most inspirational output to date. EFTA01100555 Mehmet Aricioglu will join Eric as part of the brand's core executive management team. Philippe Cleach will work alongside the executive management team as a non-executive director and general counsel. 1. Mehmet Aricioglu — General Manager Mehmet has over 25 years experience in the the luxury menswear and fashion retail market. He has worked across both sectors with Hugo Boss for 12 years, Bogner, Tommy Hillfiger, Joop, Benetton, Maxfield, Barneys, Peek & Cloppenburg, Esprit, Marc'o Polo and Faconnable. He founded his own consultancy 10 years ago advising clients on their advertising, distribution, team management, corporate indentity and retial development strategy. 2. Philippe Cleach — Counsel Philippe has an extensive track record in the luxury industry. With more than 20 years experience as a lawyer, he has been involved with companies such as Cerruti, Jean-Charles de Castelbajac, Martine Sitbon, Dries van Noten, Martin Margiela, AF Vandevorst. He was also instrumental in facilitating deals such as Fendi's sale to LVMH, Revillon to Natexis Industrie, Cerruti to MP, JC de Castelbajac to Marchpole and Martin Margiela to Diesel. Philippe was a member of the board of Cerruti, under Nino Cerruti's ownership and presidency, from 1990 to 2000. After the sale of the com- pany by Nino Cerruti in 2001, Philippe conducted the buyout of the Cerruti group (in 2006) with an investment fund and managed the group as Executive CEO from 2006 to early 2009. EFTA01100556  8. Risk Factors and Disclosures The risks described below are all the risks which are considered by the Directors to be material to a potential inves- tor in the Company. If prospective Applicants are in any doubt as to the consequences of their acquiring, holding or disposing of Class A Shares, they should consult their stockbroker, bank manager, solicitor, accountant or other inde- pendent financial adviser authorised under the Financial Services and Markets Act 2000 or, in the case of prospective Applicants outside the United Kingdom, another appropriately authorised independent financial adviser. The following additional risk factors should be considered when evaluating such an investment in EWFML. Nature No assurance of investment return The value of an investment in EWFML can go down as well as up and Applicants are warned that they may not get back the amount originally invested. nvestment Specific market conditions and cycles may result in occasional or permanent reductions in the value of the investments made by the Eric Wright Fashion. Actual realised returns on unrealised investments will depend on, among other factors, future operating results, the value of the assets and market condi- tions at the time of disposition, any related transaction costs and the timing and manner of sale, all of which may differ from the assumptions on which the valuations used in the prior performance data contained herein are based. Accordingly, the actual realised returns on unrealised investments may differ materially from the returns indicated herein. There can be no assurance that the Company will be able to implement its investment strategy or achieve its investment objective. The terms of the documentation constituting and relating to the Eric Wright Fashion have not been finalised and may be subject to continuing negotiation with prospective Applicants. The final terms of the Eric Wright Fashion may be different from those summarised herein or provided in the materials referenced herein. Net value of investment The net value of an Applicant's investment in EWFML is likely to be significantly less than the amount of such Applicant's funded Net Commitments for a significant period of time following closing. This is primarily a result of (i) the impact of fees and expenses and (ii) the likelihood that poorly performing investments made by the Company will be written down in value prior to any successful investments being realised. The negative effect of fees and ex- penses in the period following closing is further increased as the fees charged by the Company during the investment period of the Company are calcu- lated on the basis of the aggregate amount of the commitments made to the Company rather than on the basis of the drawndown commitments. Applicants have no management role EWFML will be managed by the Directors and accordingly Applicants will not be able to make investment or other decisions on behalf of EWFML or have any role in EWFML. Lack of diversification and credit risk relating to the Eric Wright Fashion Applicants should be aware that EWFML is expected to invest in the Eric Wright Fashion only and therefore that EWFML's direct investments will not be diversified. Furthermore, there can be no guarantee that the investments of the Eric Wright Fashion will be diversified either. As such, Applicants' returns on their holding in EWFML or will be directly and exclusively related solely to the performance of the Eric Wright Fashion and its Directors and conse- quently the impact on Applicants of adverse developments in the Eric Wright Fashion would be considerably greater than if there had not been such concentration of investment. No visibility as to potential investments There may be little or no near-term cash flow available to the Applicants in EWFML. Since the Eric Wright Fashion may make only a limited number of collections and since many of the investments may involve a high degree of risk, poor performance by a few of those investments could severely affect the total returns to Applicants in EWFML. EWFML will not have an opportunity to evaluate specific assets prior to investing in the Eric Wright Fashion. Additionally, it should be noted that any indications of past performance are not a guarantee of future results. No assurance can be given that target returns of EWFML will be achieved or that any returns will be achieved. EFTA01100557 Legal, Tax and An investment in EWFML may not be suitable for an Applicant. Applicants are advised to seek professional advice from their tax, legal, investment and/ Regulatory or other financial adviser on the suitability or otherwise for them of an investment in EWFML. Risks Restrictions on EWFML's participation in the Eric Wright Fashion will be highly illiquid and consist of securities that are subject to restrictions on sale by EWFML be- Transfer and cause they were acquired by EWFML in a "private placement" transaction and because the Eric Wright Fashion imposes transfer restrictions compa- Wi