08/03/2023 - Midatech Pharma plc: FAQs regarding proposed AIM cancellation

FREQUENTLY ASKED QUESTIONS REGARDING ORDINARY SHARES, ADSs

AND THE PROPOSED AIM CANCELLATION

1. WHAT IS THE RELATIONSHIP BETWEEN MIDATECH PHARMA PLC'S ("MIDATECH") ORDINARY SHARES AND AMERICAN DEPOSITARY SHARES ("ADSs")?
   Each ADS is a tradeable security representing twenty-five (25) ordinary shares of currently £0.001 nominal value each in the capital of Midatech, and, following the proposed consolidation of Midatech's ordinary shares, each ADS shall represent twenty-five (25) ordinary shares of £0.02 nominal value each in the capital of Midatech (the "Ordinary Shares"). Assuming that the proposed consolidation is approved by shareholders at the General Meeting, in order to bring the price of the ADSs into compliance with NASDAQ's minimum bid price requirement, Midatech intends to change the ratio of its ADSs from one (1) ADS representing 25 Ordinary Shares to a new ratio of one (1) ADS representing five (5) Ordinary Shares. There can be no assurance that such ratio change, if it occurs, will be effective in achieving Midatech's goal of regaining compliance with NASDAQ's minimum bid price requirement.
   The ADSs representing Ordinary Shares are listed on The NASDAQ Capital Market ("NASDAQ") under the ticker symbol: MTP and following the proposed change of name of Midatech to Biodexa Pharmaceuticals PLC the ticker symbol is expected to change to "BDRX". The value of each ADS is denominated in US dollars. Midatech is proposing that there is a cancellation of the admission of its Ordinary Shares to trading on AIM, subject to shareholder approval at the general meeting to be held on 24 March 2023 (the "General Meeting") (the "AIM Cancellation").
2. DO I NEED TO SELL MY AIM-QUOTED ORDINARY SHARES OR MUST I DEPOSIT THEM FOR DELIVERY OF NASDAQ-LISTED ADSs?
   As at the date of the shareholder circular and notice convening the General Meeting, holders of Ordinary Shares currently have three options:
3. 1. You may choose to deposit your Ordinary Shares for delivery of ADSs tradeable on NASDAQ prior to the AIM Cancellation
      If your investment is currently held in CREST and managed by a broker, your broker will be able to manage the deposit process for you in accordance with the process set out in Appendix A of this document. If you wish to deposit your Ordinary Shares for delivery of ADSs, you should contact your broker to initiate this process without delay. Please see the response to question 8 below "My broker currently holds my Ordinary Shares within a CREST nominee account - how do I deposit my shares for delivery of ADSs?".
      If you hold your investment in certificated form and wish to deposit it for delivery of ADSs without engaging the services of a broker, you may hold ADSs on the books of Midatech's ADS depositary, BNY Mellon, in DRS (Direct Registration System) uncertificated format. For details on how to deposit your Ordinary Shares, please see the response to question 5 below "I hold my shares in certificated form and I want to deposit my Ordinary Shares for delivery of ADSs prior to the AIM Cancellation but do not want to engage a broker at this time - how do I do this?".
   2. You may choose to continue to hold your Ordinary Shares after the AIM Cancellation
      Ordinary Shares will continue to be a valid equity interest in Midatech with full voting rights, rights to future dividends, etc., as currently held by holders of Ordinary Shares. However, following the AIM Cancellation there will be no regulated market or multilateral trading facility in the United Kingdom on which the Ordinary Shares can be traded. Please see the response to question 10 below "Can I continue to hold Ordinary Shares after the AIM Cancellation?".
   3. You may choose to sell your AIM-quoted Ordinary Shares prior to the AIM Cancellation becoming effective
      If you wish to maintain an equity interest in Midatech, you could choose to reinvest in Midatech by using the proceeds of the sale of your Ordinary Shares to buy NASDAQ-listed ADSs (NASDAQ

ticker: currently MTP and proposed to change to BDRX). Dealing and tax costs would likely apply to the AIM and/or NASDAQ transactions.

1. I DO NOT HAVE A BROKER - DO I REALLY NEED ONE?
   You may wish to engage a broker if you are not participating in the block transfer process described in question 5 below. If you do not already have an account with a broker, you may be able to open one either online or through banks and building societies which offer broking services. You need to ensure that the broker and type of account on offer is capable of holding and trading US-listed securities. Often the most basic account offered is for public UK shares only so you will need to select an account that gives you the ability to buy and sell US-listed securities. Please ensure that you check with your broker that they can hold Midatech ADSs and have a Depository Trust Company (DTC) participant account.
2. I CURRENTLY HOLD MY ORDINARY SHARES IN THE FORM OF A PAPER CERTIFICATE - HOW DOES THE AIM CANCELLATION AFFECT ME?
   Ordinary Shares in certificated form are not currently immediately tradeable as, in order to sell them, the share certificates or an acceptable indemnity in lieu thereof (in a form to be provided by Neville Registrars) needs to be deposited with a broker and "dematerialised" so that they are held in electronic form in CREST, which is the electronic system for the holding of shares in uncertificated form and paperless settlement of share trades on AIM. Only when the Ordinary Shares have been converted into electronic form can they then be traded on AIM.
   If you choose to retain your Ordinary Shares in certificated form but do not deposit them for delivery of ADSs prior to the AIM Cancellation, in order to sell them following the AIM Cancellation, you will need to use a broker with UK and US capabilities to firstly dematerialise your UK share certificate or an acceptable indemnity in lieu thereof (in a form to be provided by Neville Registrars) into CREST and thereafter to liaise with Midatech' s depositary, BNY Mellon, to issue the respective ADSs for your broker to sell on your behalf. Your broker will need to contact BNY Mellon in order for your Ordinary Shares to be deposited for delivery of ADSs and credited to the account held by your broker. Upon receiving instructions to do so, your broker would then trade your ADSs via NASDAQ and would remit the proceeds to your personal account. Please also see the response to question 10 below "Can I continue to hold Ordinary Shares after the AIM Cancellation?". Please note that a deposit of Ordinary Shares for delivery of ADSs following the AIM Cancellation becoming effective will incur a UK stamp duty, or stamp duty reserve tax ("SDRT"), charge (the rate of which is currently 1.5 per cent. of the market value of the shares deposited for ADSs), although in all cases professional advice should be sought as to the applicable tax treatment.
3. I HOLD MY SHARES IN CERTIFICATED FORM AND I WANT TO DEPOSIT MY ORDINARY SHARES FOR DELIVERY OF ADSs PRIOR TO THE AIM CANCELLATIONBUT DO NOT WANT TO ENGAGE A BROKER AT THIS TIME - HOW DO I DO THIS?
   If your investment is currently held in certificated form outside of CREST, Midatech's registrar, Neville Registrars, will facilitate a block transfer process, on behalf of Midatech, for those shareholders who do not already hold their Ordinary Shares via a broker and who may wish to participate in a managed deposit process. This process is only available prior to the AIM Cancellation to holders of Ordinary Shares in certificated form. Subject to the requisite paperwork being returned to Neville Registrars by the required deadline, being 1.00 p.m. on 24 April 2023, Neville Registrars, will arrange for the relevant Ordinary Shares to be transferred into CREST and then deposit the Ordinary Shares with BNY Mellon, as the depositary, who will then arrange for the delivery of ADSs in the name of the relevant shareholder on the books of the depositary, in registered uncertificated form. Holders of Ordinary Shares in certificated form will be sent a personalised block transfer participation request form, an example of which is set out in Appendix B. If a shareholder wishes to participate in this managed deposit process, they should complete the form and return it along with the original share certificate(s) or an acceptable indemnity in lieu thereof (in a form to be provided by Neville Registrars) to Neville Registrars at Neville House, Steelpark Road, Halesowen, West Midlands B62 8HD, so as to be received by Neville Registrars by no later than 1.00 p.m. on 24 April 2023. Further block transfer participation request forms (which are not personalised) are available on Midatech's website at www.midatechpharma.com,

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or can be requested from Neville Registrars by calling +44 (0) 121 585 1131. Calls are charged at the standard geographic rate and will vary by provider. Calls from outside the UK will be charged at the applicable international rate. Lines are open from 9.00 a.m. to 5.00 p.m., Monday to Friday, excluding public holidays in England and Wales. Completed certificated transfer forms and original share certificates or an acceptable indemnity in lieu thereof may be returned to Neville Registrars, for UK shareholders only, by using the pre-paid envelope sent to you. Both UK shareholders and non-UK shareholders may prefer to return certificated transfer forms and original share certificates or an acceptable indemnity in lieu thereof using registered post.

If the resolution proposed in connection with the AIM Cancellation is not passed at the General Meeting, all documents provided to Neville Registrars and/or BNY Mellon in relation to the deposit of Ordinary Shares for delivery of ADSs shall be of no effect and all original share certificates or an acceptable indemnity in lieu thereof will be returned to shareholders by Neville Registrars. Shareholders who hold their Ordinary Shares in certificated form and who do not elect to participate in this block transfer process may utilise the services of a broker to facilitate the deposit.

Following the deposit of Ordinary Shares for delivery of ADSs in registered uncertificated form, note that all registered holders will be subject to US stock transfer procedures and guidelines. Holders should consult with a broker to determine applicable stock transfer requirements in relation to future transfers of ADSs. These requirements may include a medallion signature guarantee to effect certain transfers. Further details on medallion signature guarantees may be found at www.investor.gov/introduction-investing/investing-basics/glossary/medallion-signature-guarantees- preventing.

1. I HAVE ALREADY INITIATED THE DEMATERIALISATION OF MY UK SHARE CERTIFICATE INTO CREST IN ORDER TO DEPOSIT MY ORDINARY SHARES FOR DELIVERY OF ADSs - WHAT SHOULD I DO?
   In order to participate in the block transfer process being facilitated by Neville Registrars, you will need to return your original share certificate or an acceptable indemnity in lieu thereof (in a form to be provided by Neville Registrars) with your block transfer participation request form. Accordingly, if you have already returned your share certificate or an acceptable indemnity in lieu thereof (in a form to be provided by Neville Registrars) in order to dematerialise it into CREST, you will not be able to participate in the block transfer process. In these circumstances, you should continue with the dematerialisation process and contact your broker to ensure that this and the delivery of ADSs is completed before the AIM Cancellation. Please also see the response to question 7 below "I currently hold my ordinary shares in uncertficated/electronic form in CREST - how does the AIM Cancellation affect me?".
2. I CURRENTLY HOLD MY ORDINARY SHARES IN UNCERTIFICATED/ELECTRONIC FORM IN CREST
   - HOW DOES THE AIM CANCELLATION AFFECT ME?

If your investment is currently held in electronic form in CREST and managed by a broker, your broker will be able to manage the deposit process for you in accordance with the process set out in Appendix A of this document.

If your Ordinary Shares are currently held in electronic form in CREST and you do not deposit them for delivery of ADSs before the AIM Cancellation, your Ordinary Shares will continue to be held in your CREST account, but in unquoted form. Following the AIM Cancellation, you will not be able to publicly trade any of your Ordinary Shares on any recognised exchange in CREST as Midatech will have cancelled its admission to trading on AIM. Please see question 10 below "Can I continue to hold Ordinary Shares after the AIM Cancellation?". Deposits of Ordinary Shares for delivery of ADSs following the AIM Cancellation becoming effective will incur a UK stamp duty, or SDRT, charge (the rate of which is currently 1.5 per cent. of the market value of the shares deposited for ADSs), although in all cases professional advice should be sought as to the applicable tax treatment.

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8. MY BROKER CURRENTLY HOLDS MY ORDINARY SHARES WITHIN A CREST NOMINEE ACCOUNT

- HOW DO I DEPOSIT MY SHARES FOR DELIVERY OF ADSs?

Many UK brokers have the ability to hold and trade NASDAQ-listed securities. In order to continue holding a form of security that is readily tradeable, you should contact your broker without delay to request that Ordinary Shares are deposited for delivery of ADSs by following the process set out on Appendix A of this document. Your broker will provide Midatech's depositary, BNY Mellon, with certain details by email in relation to the deposit and will then transmit your Ordinary Shares electronically to BNY Mellon's UK custodian's CREST account in return for the delivery of ADSs.

1. HOW DOES THE PRICE OF NASDAQ-LISTED ADSs COMPARE TO THE PRICE OF ORDINARY SHARES ON AIM?
   Midatech currently maintains a listing of ADSs on the NASDAQ Capital Market tier of The NASDAQ Stock Market LLC. Each ADS is a financial instrument that currently represents twenty-five (25) Ordinary Shares. The price of each ADS is expressed in US dollars and should, but is not required to, approximate the value of the 25 Ordinary Shares that it currently represents on a currency adjusted basis. Currently, the price of an Ordinary Share on AIM can be compared approximately to the price of Midatech's NASDAQ-listed ADSs by dividing the ADS price by 25 and then dividing by the US dollar to pounds sterling exchange rate to calculate the equivalent sterling denominated price per Ordinary Share.
   As part of the AIM Cancellation, holders of Ordinary Shares may deposit such Ordinary Shares for delivery of ADSs (see question 2 "Do I need to sell my AIM-quotedOrdinary Shares or must I deposit them for delivery of NASDAQ listed ADSs?" above). Once Ordinary Shares are deposited and the ADSs subsequently delivered, the investment will be US dollar denominated instead of pounds sterling denominated. This means that when valued in pounds sterling, its value will fluctuate on a day-to-day basis in line with movements in the £:US$ exchange rate.
   Once the AIM Cancellation takes effect on 26 April 2023, there will no longer be a published price for an individual Ordinary Share. It will, however, always be possible to calculate the value of an individual Ordinary Share in pounds sterling by taking the NASDAQ ADS market price, dividing by 25 and dividing by the US dollar to pounds sterling exchange rate. The NASDAQ ADS price is, and will continue to be, available via Midatech's website at www.midatechpharma.com or may otherwise be found online on a broad range of third party financial websites.
2. CAN I CONTINUE TO HOLD ORDINARY SHARES AFTER THE AIM CANCELLATION?
   Should you wish to do so, it will be possible to continue to hold Ordinary Shares after the AIM Cancellation. However, shareholders should be aware that the Ordinary Shares will not be admitted to trading on any regulated market or multilateral trading facility in the United Kingdom and the Ordinary Shares will not be tradeable on NASDAQ in this form.
   Should you wish to sell your Ordinary Shares following the AIM Cancellation becoming effective, you will likely be required first to deposit such Ordinary Shares for delivery of ADSs via Midatech's depositary bank, BNY Mellon, and any sale of the resulting ADSs will likely need to be via a broker with US share trading capability. Please note that a deposit of Ordinary Shares for delivery of ADSs following the AIM Cancellation becoming effective will incur a UK stamp duty, or SDRT, charge (the rate of which is currently 1.5 per cent. of the market value of the shares deposited for ADSs), although in all cases professional advice should be sought as to the applicable tax treatment. Fees of up to US$0.05 per ADS may also be levied by Midatech's depositary bank upon such exchange (although the depositary bank has confirmed that no such fee will be charged to holders on any exchange of Ordinary Shares for delivery of ADSs from the publication date of these FAQs (7 March 2023) until (and including) 25 April 2023).
3. I ALREADY HOLD ADSs - AM I AFFECTED BY THE AIM CANCELLATION?
   The NASDAQ-listed ADSs will continue to trade as normal. Existing holders of ADSs not also holding Ordinary Shares do not need to take any action in connection with the AIM Cancellation.

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1. HOW DO I BUY AND SELL NASDAQ LISTED ADSs?
   The majority of brokers in the UK have the capability to hold US exchange-listed securities and are capable of buying and selling them for you. A small depositary services fee ("DSF") currently US$0.01 per ADS per annum, is levied by Midatech's depositary bank, BNY Mellon, and brokers may also charge an annual fee for holding a US security on your behalf.
   Should you wish to increase your holding in Midatech, you should be able to purchase further ADSs via your broker. You will need to instruct your broker to purchase Midatech ADSs (NASDAQ ticker: MTP, which is proposed to change to BDRX).
   If you wish to continue to hold your investment in Midatech directly, without engaging the services of a broker, you may hold ADSs in your name on the books of Midatech's depositary, in registered uncertificated form. If a shareholder wishes to receive ADSs without engaging the services of a broker prior to the AIM Cancellation, please see the response to question 5 above "I hold my Ordinary Shares in certificated form and I want to deposit my Ordinary Shares for delivery of ADSs prior to the AIM Cancellation but do not want to engage a broker at this time - how do I do this?".
2. IS THERE A COST TO DEPOSIT MY ORDINARY SHARES AND HOLD MY MIDATECH INVESTMENT IN THE FORM OF ADSs?
   Ordinarily, shareholders who deposit their Ordinary Shares for delivery of ADSs are charged an ADS issuance fee, by the depositary, of up to $5.00 per 100 ADSs or portion thereof. However, no ADS issuance fees will be charged to shareholders who elect to deposit their Ordinary Shares in connection with the AIM Cancellation prior to 26 April 2023 (being the date on which the AIM Cancellation takes effect),
   Other than in connection with the AIM Cancellation, ADS issuance fees of up to $5.00 per 100 ADSs or portion thereof will be charged by the depositary in connection with any future deposits of Ordinary Shares.
   The DSF, currently US$0.01 per ADS, is levied to ADS holders by BNY Mellon annually. This is typically paid and charged to your account by your broker or for registered holders the fee assessed will be invoiced to your account of record. All ADS holders are required to pay the annual DSF.
3. HOW WILL THE AIM CANCELLATION AFFECT THE TAX TREATMENT OF MIDATECH'S ORDINARY SHARES?
   Midatech is not able to provide shareholders with any form of taxation advice and shareholders are strongly advised to seek their own professional advice in order to ascertain the consequences for them of continuing to hold Ordinary Shares following the AIM Cancellation becoming effective or depositing Ordinary Shares for delivery of ADSs.
   The following summary does not constitute legal or tax advice and is not exhaustive. Midatech's understanding of the current position for individuals who are UK resident and UK domiciled under UK taxation law is as follows but it should be noted that the position on certain points is not free from uncertainty and Midatech has not taken steps to confirm the current position with HMRC. Therefore, neither the following summary nor any other statements relating to tax in these "Frequently Asked Questions" should be relied upon by shareholders (and Midatech accepts no liability whatsoever in respect of any tax information provided).
   Some investors purchase AIM-quoted shares because they may be classed as unlisted/unquoted securities which may qualify for relief from inheritance taxation and certain other preferential tax benefits. The AIM Cancellation should not, in itself, prevent the Ordinary Shares (and, therefore, continued holding of such Ordinary Shares) from qualifying as unlisted/unquoted securities for the purposes of certain specific UK tax rules (notably, the UK inheritance tax business property relief rules). Accordingly, it is expected that HMRC should accept that those shareholders who elect to continue to hold unlisted Ordinary Shares should continue to be regarded as holding unlisted/unquoted securities under those same rules.

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