Contract and related party transaction

Billam plc ("Billam" or the "Company")

Project Finance
and
related party transaction

Further to the announcement at the Annual General Meeting that the
Board was considering other investment opportunities,
the Board is delighted to announce that Development Funding Limited
("DFL"), a wholly owned subsidiary of Billam Plc, has
today made its first investment since receiving shareholder approval
to widen its investment strategy, providing mezzanine
finance to a housebuilding company.

A mezzanine facility of £904,800 has been provided for a period of
less than two years to a property developer in connection
with a specific development in Northamptonshire which is expected to
be completed in summer 2008 with a gross
development value of £5.14 million. Billam is sharing the development
risk and is targeting an annualised return in the range
of 20% to 40%. In line with the broadened investment strategy the
Board expects the Company to make a series of such
advances in the ordinary course of its business.

In order to finance this transaction, a substantial shareholder of
the Company, Stephen Wicks, who holds 2,664,700 ordinary
shares representing 25.13 per cent. of the issued share capital of
the Company, has advanced £400,000 to the Company at a
rate of 1.75 per cent. above Royal Bank of Scotland's base rate to be
paid when the Company has sufficient resources to
redeem the loan. Mr Wicks has agreed to provide further finance in
connection with the above transaction to meet the
Company's commitment. He has also provided additional loans totalling
£373,000 to the Company for working capital on
the same commercial terms and has the option to convert these loans
into the Company's shares at 20p per share being a 43
per cent. premium to the current market price. These loans have been
secured by a debenture over the Company and DFL's
assets.
The loans by Mr. Wicks to the Company are related party transactions
as defined in the AIM Rules. The directors of the
Company consider the terms of the loans to be on normal commercial
terms and having consulted the Company's nominated
adviser, consider the terms of the loans to be fair and reasonable
insofar as the Company's shareholders are concerned.
Enquiries:

Billam plc
Simon Bennett [phone]
Chairman

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