Axiom

University of Leeds Outsources its Intellectual Property Commercialisation to Axiomlab Plc

Trading Update

Axiomlab plc (“Axiomlab”), the AIM listed regional provider of capital and business building expertise, is pleased to announce that it has obtained the rights to provide intellectual property commercialisation services to The University of Leeds. In return, Axiomlab will provide £1 million in funding for the working capital requirements of Techtran Limited (“Techtran”), a newly formed, wholly owned subsidiary of Axiomlab. Techtran will drive the intellectual property commercialisation services on behalf of Leeds University and will receive a share of the equity of spin out companies it assists, as well as a share of licensing agreements it negotiates. The University and its inventors will also hold stakes in spin out companies and share in revenue streams.

Axiomlab will announce its interim results for the period ended 31 October 2002 in January 2003. Axiomlab currently has investments in fourteen companies. Commenting on the portfolio, Fred Mendelsohn, Managing Director, said: “The trading environment and ability for early stage companies to gain access to capital has been challenging but our portfolio companies have benefited from the complementary range of skills that the management team at Axiomlab are able to offer. News from our investee companies has been mixed, but on the whole we are pleased with their performance.”

He added: “We were disappointed that on 31 October 2002, ITM Communications was placed into administration. However the carrying value of ITM had previously been substantially provided against within a general provision in our accounts.

CSols plc, which provides Laboratory Information Management System software, has performed well. Since launch CSols has developed an impressive list of blue-chip clients including - BP Chemicals, Procter and Gamble, GlaxoSmithKline, Bristol Myers Squibb and Novartis, with whom it continues to work closely - and it is also currently in negotiations with a number of other high profile players in the pharmaceutical industry. CSols recently completed a new funding round totalling £850,000. Axiomlab has underwritten £236,000 of this total, which it is intended will be syndicated to third party investors in the future.

Auctions2Business Limited was originally established as an on-line auctioneer of pre-owned industrial plant and machinery. The original web based business model did not succeed and, as one of Axiomlab’s early internet investments, was partially provided against through a general provision. Axiomlab did subsequently seek to use the business as the vehicle to consolidate the fragmented traditional auctioneering businesses of plant and machinery. However, it has been difficult to secure additional funding for this and we feel it is now prudent to make full provision against this investment, which had a total cost of £1.25 million.

Get Real Systems Limited is trading profitably and the company exceeded all of its targets in the quarter ending 31 October 2002, confirming the success of its new indirect sales strategy. Not only has the company generated sales through resellers (including major implementations at The Law Society, Greater Manchester Passenger Transport Executive and Cox Insurance Holdings), but new orders are also coming from existing customers, such as London publishing house, H Bauer and the University of Birmingham. Get Real Systems is now focusing on adding to the number of resellers in its Channel Programme, which will include major consulting firms and outsourcers, as well as more systems integrators and accounting software vendors.

Netlet Limited has completed a third party fund raising of £160,000. The company continues to trade successfully and has now started to license its technology to Universities to enable the matching of students to available accommodation.

Thermetica Limited, which specialises in licensing thermal energy technology and storage devices, has been granted a facility of up to £460,000 by Axiomlab which has enabled the company to buy back all the shares not previously held by Axiomlab or the original founders.

Axiomlab has invested a further £150,000 in Empiricom Limited. This will form part of the facility of £225,000 referred to in the Annual Accounts for the year ended 30 April 2002. Following the investment, Axiomlab’s equity interest in Empiricom is now 80%.

In summary, we continue to build our portfolio of investments which we feel confident can deliver long-term significant shareholder value. Our investment in Techtran is particularly exciting in this regard.”