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04 October 2005

Early agreement of earn-out relating to Gourmet Burger Kitchen

The Clapham House Group PLC ("Clapham House" or "the Company") announces it has reached an early agreement to conclude the earn-out arrangement relating to the purchase of the Gourmet Burger Kitchen business ("GBK").

- Clapham House has agreed to satisfy the maximum consideration of GBK under the earn out of £7.4million, which will now be payable as to £0.5million by the issue yesterday of 338,982 ordinary shares of 10 pence each in the Company ("New Ordinary Shares") at a price of 147.5 pence per share and £6.9million in cash, payable in April 2006. Under the original deal to acquire GBK, completed in November 2004, earn-out consideration was payable based on a multiple of GBK's EBITDA for the twelve months to 31 March 2006 or, at the election of the vendors, for the twelve months to 31 December 2005. The total earn-out element was capped at £7.4million.

- The existing management team of GBK, comprising Greg Driscoll, Brandon Allen and Adam Wills, will continue as directors of GBK.

- David Sykes, formerly Restaurants MD at PizzaExpress PLC, has recently joined Clapham House and will join the board of GBK.

Application has been made for the admission of 338,982 New Ordinary Shares to trading on the Alternative Investment Market of the London Stock Exchange. The New Ordinary Shares will rank pari passu with all existing ordinary shares in the Company. It is expected that admission will become effective and that dealings in the New Ordinary Shares will commence on 6 October 2005. The number of ordinary shares in issue following admission of the New Ordinary Shares becoming effective will be 20,593,002.

Paul Campbell, Chief Executive of Clapham House, commented:

The Gourmet Burger Kitchen business is performing strongly across its eight existing restaurants and our pipeline of new sites is developing well. I am very pleased that we have reached an agreement on the earn-out consideration some six months early as it will enable us to accelerate expansion of this award winning format.