Och-Ziff managed funds acquire strategic position in Brain Resource

Och-Ziff managed funds acquire strategic position in Brain Resource

14 June 2011

We are pleased to announce that Sculptor Finance (MD) Ireland Limited, Sculptor Finance (AS) Ireland Limited and Sculptor Finance (SI) Ireland Limited (collectively, the “Subscribers”) have agreed to acquire $10m principal amount of convertible bonds (“Bonds”) in Brain Resource Limited (ASX: BRC / OTC ADR: BRRZY). The investment manager of the Subscribers is OZ Management LP, an operating company of Och-Ziff Capital Management Group LLC (NYSE: OZM).

This external validation of Brain Resource, and the scale of the Brain Health market opportunities, marks a significant milestone.

“Having an investor of this caliber has significant operational benefits for Brain Resource as it extends new large market opportunities. Most importantly, we have found in Och-Ziff a partner that has aligned interests in capitalizing on the timeliness of the brain sector becoming mainstream. We look forward to growing our relationship with Och-Ziff and consolidating our leading position in the market. This capital base provides us with the resources to significantly drive sales of our current scalable web products. It also allows us to extend our web brain training platform direct to consumers.” Dr Evian Gordon CEO.

The Bonds convert into ordinary equity at a price of 40.5 cents per share, have a 5 year term and no coupon payable. Conversion equates to a 21% shareholding in Brain Resource, assuming full conversion and no intervening share issues or employee option exercises. The issue is in two tranches of AUD$5,000,000 each. The first tranche is being issued currently. The second tranche issue is subject to a number of conditions precedent including the approval by the Subscribers of the appointment of a CEO to lead Brain Resource’s US subsidiary and the business plan. The second tranche issue is also subject to shareholder approval. This is to be sought within the next 8 weeks so as to ensure an expeditious issue once the preconditions are met. (Note shareholder approval of the first tranche issue is not required, it falling within the ASX Listing Rule 7.1 “15% threshold”).

In this regard, Dr Evian Gordon (Chairman and CEO) and Dan Segal (Executive Director and Chief Operating Officer), together being 18% shareholders in Brain Resource, have informed Brain Resource that they intend to vote the shares they hold or control in favour of the issue of the second tranche of convertible bonds, in the absence of a superior proposal. Brain Resource has also been informed that Spinite Pty Ltd, being a 17% shareholder, has provided a deed poll in favour of the Subscribers committing to vote its shares in favour of the issue of the second tranche of convertible bonds.

Please see the attached Cleansing Notice issued under section 708A(12C)(e) of the Corporations Act 2001 for the purposes of ASIC Class Order [CO 10/322] to enable fully paid ordinary shares in the capital of BRC to be issued on conversion of convertible bonds in the capital of the Company (“Bonds”) to be on-sold to retail investors. This Cleansing Notice relates to the issue of the first tranche of Bonds with the value of AUD$5,000,000.

Please also see the attached Terms and Conditions of the Bonds.

About Och-Ziff Capital Management Group LLC

Och-Ziff Capital Management Group LLC is a leading global institutional asset management firm with approximately US$30 billion of assets under management as of 1 June 2011.

About Brain Resource

Brain Resource Ltd translates the most useful new brain findings from the Brain Resource International Database into scalable products, that empower individual users to assess, train and improve their brain functions. For more information, please visit Brain Resource’s website at www.brainresource.com.

Brain Resource Contacts:

Media: Julian Brophy; julian@perceptionpartners.com.au; 0408 276 749

Company: Dr Evian Gordon (CEO) +61 407 272 000.