Proposed Accelerated Bookbuild

RNS Number : 6292Q

Mobile Streams plc

01 December 2016

1 December 2016

Mobile Streams plc

("Mobile Streams" or the "Company")

Proposed placing of 39,418,000 new Ordinary Shares at a price of 4 pence per Ordinary Shares to raise £1.6 million

· Mobile Streams (AIM: MOS) is pleased to announce its intention to conduct a placing of 39,418,000 new Ordinary Shares in the Company (the "Placing Shares"), at a price of 4 pence per share (the "Placing Price") to raise approximately £1.6 million (before expenses) (the "Placing").

· The Placing Shares are being offered by way of an accelerated bookbuild ("Bookbuild"), which will be launched immediately following this announcement. Nplus1 Singer Advisory LLP ("N+1 Singer") will be acting as sole bookrunner in connection with the Bookbuild.

· The net proceeds of the Placing will be used to finance the rapid growth in working capital required by the Company's plans and to enable the Company to commit to its proposed marketing spend in India through to the end of the next financial year in 2018.

· The Company highly values its private investor base and is therefore opening this opportunity to individual investors through PrimaryBid.com before 5:00 p.m. on 1 December 2016. Further announcements will be made shortly in connection with this offer.

· The Placing is conditional on, inter alia, the passing of the Placing Resolutions to be proposed at a General Meeting expected to be held at the offices of Memery Crystal LLP at 44 Southampton Buildings, London WC2A 1AP at 12.00 pm on 19 December 2016. A circular which will provide further details of the Placing and include a notice convening the General Meeting (the "Circular"), is expected to be sent to Shareholders and be available on the Company's website in the coming few days.

Simon Buckingham, Chief Executive Officer, said: "As announced at the time of our recent results announcement, we are refocusing our business and looking to utilise our significant experience of running mobile games services in Latin America to develop our ad-funded games service and subscription services in India. The proposed fundraising will provide us with the working capital we require to commit to our planned marketing spend in India."

Expected timetable

Closing of Bookbuild	5.00 p.m. on 1 December 2016
Announcement of completion of the Placing and Bookbuild	7.00 a.m. on 2 December 2016
Posting of the Circular and Form of Proxy	2 December 2016
Latest time and date for receipt of Forms of Proxy for the General Meeting	12.00 p.m. on 15 December 2016
Time and date of General Meeting	12.00 p.m. on 19 December 2016
Admission and commencement of dealings in the New Ordinary Shares	8.00 a.m. on 20 December 2016

Terms used but not defined in this announcement shall have the meanings given to such terms in the Circular. This announcement contains inside information for the purposes of Article 7 of EU Regulation 596/2014 ("MAR"). In addition, market soundings (as defined in MAR) were taken in respect of the Placing with the result that certain persons became aware of inside information (as defined in MAR), as permitted by MAR. This inside information is set out in this Announcement. Therefore, those persons that received inside information in a market sounding are no longer in possession of such inside information relating to the Company and its securities.

Enquiries:

Mobile Streams plc	+1 347 669 9068
Simon Buckingham, Chief Executive Officer Enrique Benasso, Chief Financial Officer

Nplus1 Singer Advisory LLP Nominated Adviser and Broker	+44 (0)20 7496 3000
Alex Price Alex Laughton-Scott

Details of the Placing

1. Introduction and summary

The Company today announces its intention to raise approximately £1.6 million (before expenses) by way of a placing of 39,418,000 new Ordinary Shares at a Placing Price of 4 pence each. The Placing is not being underwritten. Further details and terms of the Placing are described below.

The Company highly values its private investor base. Given the longstanding support of shareholders, including a large number of private shareholders, the Company believes that it is appropriate to provide private and other investors with an opportunity to participate in this issue of New Ordinary Shares alongside institutional investors. The Company therefore intends to open this opportunity to individual investors through PrimaryBid.com and further announcements will be made shortly in connection with this offer.

The Placing is conditional subject, amongst other things, on the passing of the Placing Resolutions at the General Meeting, which will be proposed to grant the Directors the necessary authority and power to allot the Placing Shares and any shares that may be subscribed for by private investors via Primarybid for cash on a non-pre-emptive basis, and Admission.

2. Background to and reasons for the Placing

As announced at the time of the Company's results to 30 June 2016, Mobile Streams has focused on three main objectives in its recent business trading:

· expansion into India;

· stabilisation of its Latin American business primarily in Argentina; and

· seeking to minimise net cash outflow.

Generally, the Company has sought to invest the profits from its relatively mature Argentine operations into developing the Group's fast growing India business and, in pursuit of that strategy, the Company formed Mobile Streams India Private Limited in October 2015 to enable Mobile Streams to sign agreements with Indian mobile network operators (MNOs), device manufacturers (OEM) and other third parties and this is already proving to be successful. The Directors believe that India represents the single biggest opportunity for Mobile Streams over the last 15 years.

As per the strategy in Latin America, the focus in India is very much on the recurrent revenue generating subscription service, with both daily and weekly subscription packages being trialled. The Group's ad-funded Mobilegaming.com service was launched in February 2016 with the top three Indian mobile operators with marketing campaigns coordinated by the same team responsible for the success the Company has had in the Latin American region over the past several years. Active subscriber numbers are steadily growing and now exceed 75,000 in India. Active subscribers are measured as consumers who have made a purchase from the Company in the country in the past 60 days. For like-for-like comparability, this is the same methodology the Company uses to measure active subscribers in its other markets such as Argentina.

Looking ahead to the remainder of 2016 and beyond, the Company's primary objectives are to secure mobile billing with the leading seven or eight mobile operators in India, progressively increase marketing spend to grow the active subscriber base, enhance the Group's content and service offer by partnering with local Indian companies and the launch of a browser based games service (utilising HTML5) to become one of the leading destinations for the existing 185 million Indian mobile gaming consumers. Mobile Streams has signed contracts with two of the three largest Indian telecom operators and contracts are close to finalisation with two other significant operators giving a total addressable audience of around 600 million.

The Indian mobile market is growing rapidly. The entrance of Reliance Jio 4G's network into the market this year and the recent spectrum auction means the primary obstacle in the Indian mobile games market of poor data connectivity is being addressed. A report by Business Insider UK found that, India has yet to fulfil its promise as the future engine of smartphone sales growth, but that could change soon. The report showed that smartphones accounted for approximately 44% of mobile shipments in India in Q2 2015. The Directors are therefore confident in the prospects that the opportunity in India affords the Company.

India benefits from a low cost of customer acquisition of approximately $0.40-$0.70 (compared with approximately $0.50-$1.10 in Argentina), and the net lifetime value of a customer in India is approximately $0.90 to Mobile Streams (compared with approximately $1.15 to Mobile Streams in Argentina).

3. Use of proceeds

The net proceeds of the Placing will be used to finance the rapid growth in working capital required by the Company's plans and to enable the Company to commit to its proposed marketing spend in India through to the end of the next financial year in 2018.

4. Current trading

The Company announced its final results for the 12 month period ended 30 June 2016 on 10 November 2016. These results contained a review of the period to 30 June 2016 together with details of any material events since the period end. Trading since 30 June 2016 has been in line with the Directors' expectations.

5. Outlook

A recent report found that the Indian mobile computer gaming market is where China was seven years ago with Chinese mobile computer gaming revenue being currently 45 times larger than in India. The Company has already achieved success in India with direct contracts being signed with Vodafone and Idea which are currently generating revenue for the Company. Added to this, contracts are under negotiation with Aircel and BSNL which are expected to launch in Q4 2016/Q1 2017 with numerous additional early stage discussions ongoing with other network operators, device manufacturer and mobile content companies in the mobile sector. India is estimated to have the second largest English speaking population in the world and, as outlined above, significant growth is anticipated in smartphone users there.

The Directors consider that the Company is well positioned for platform and content following 10 years of running mobile games services around the world. They plan to utilise their significant experience in Latin America to exploit the nascent Indian games market. Currently, via its mobilegaming.com site, 2,500 games are available on Android and Java devices with HTML5 games being expected to launch in Q1 2017.

In the near-to-long term, the Company anticipates, on the basis of its current strategy, being able to update shareholders on the achievement of the following milestones:

• subscriber base reaching 100,000 active subscribers;

• launch of HTML5 games with Vodafone and Idea;

• the launch of mobilegaming with BSNL;

• the subscriber base reach 150,000 and then 250,000 active subscribers;

• the launch of mobilegaming with Aircel; and

• the subscriber base reaching 500,000 active subscribers and then 1.0m.

6. The Placing

The Company proposes to raise approximately £1.6 million (before expenses) through the issue of the Placing Shares at the Placing Price, which represents a discount of 50 per cent. to the closing bid-price of 8 pence on 30 November 2016 being the last business day immediately prior to the announcement of the Proposals. Having considered the price at which the Ordinary Shares are currently traded, and other market factors, the Directors have resolved that the Placing Price is appropriate. The Placing Shares will represent approximately 52 per cent. of the Company's issued ordinary share capital immediately following Admission.

Pursuant to the terms of the Placing Agreement, N+1 Singer has conditionally agreed to use its reasonable endeavours, as agent for the Company, to place the Placing Shares with certain institutional and other investors. The Placing has not been underwritten. The Placing Agreement is conditional upon the Placing Resolutions being duly passed at the General Meeting and Admission becoming effective on or before 8.00 a.m. on 20 December 2016 (or such later time and/or date as the Company and N+1 Singer may agree, but in any event by no later than 8.00 a.m. on 30 December 2016). If any of the conditions are not satisfied, the Placing Shares will not be issued and all monies received from the placees will be returned to them (at the placees' risk and without interest) as soon as possible thereafter.

The Placing Agreement contains warranties from the Company in favour of N+1 Singer in relation to, inter alia, the accuracy of the information in this announcement and other matters relating to the Group and its business. In addition, the Company has agreed to indemnify N+1 Singer in relation to certain liabilities it may incur in respect of the Placing. N+1 Singer has the right to terminate the Placing Agreement in certain circumstances prior to Admission, in particular, in the event of a breach of the warranties given to N+1 Singer in the Placing Agreement, the failure of the Company to comply with any of its obligations under the Placing Agreement, the occurrence of an adverse change in (amongst other things) national or international financial or political conditions (which in the reasonable opinion of N+1 Singer will or is likely to be prejudicial to the Group or to the Placing or Admission), any event or omission occurs which materially and adversely affects the financial position and/or prospects of the Group or which in the opinion of N+1 Singer is or will or is likely to materially and adversely affect the Group or the Placing or the Group's situation is such that Admission may, in the opinion of N+1 Singer, be detrimental to the ordinary operation or reputation of AIM.

The Company has agreed to pay certain fees and commissions to N+1 Singer in respect of the Placing.

Application will be made for Admission and it is expected that Admission will become effective and that dealings in the Placing Shares will commence at 8.00 a.m. on 20 December 2016.

The Placing Shares will, if and when issued, rank pari passu in all respects with the Existing Ordinary Shares including the right to receive dividends and other distributions declared following Admission.

7. Directors shareholdings

It is proposed that Simon Buckingham, Chief Executive Officer, will participate in the Placing in the amount of 2,003,000 Ordinary Shares.

Immediately following Admission (assuming the Placing is fully subscribed), Simon Buckingham will hold 12,385,500 Ordinary Shares, representing 16.18 per cent. of the then issued share capital of the Company.

The participation by Simon Buckingham in the Placing constitutes a related party transaction for the purposes of the AIM Rules. The independent directors for the purposes of the Placing (being the all of the remaining Directors save for Simon Buckingham), having consulted with the Company's nominated adviser, N+1 Singer, consider that the terms of the related party transaction are fair and reasonable insofar as the Shareholders are concerned.

RISK FACTORS

An investment in the securities of the Company involves a high degree of risk. Accordingly, prospective investors should carefully consider the specific risk factors set out below in addition to the other information contained in this announcement before investing in the Ordinary Shares. The Directors consider the following risks and other factors to be the most significant for potential investors in the Company, but the risks listed do not purport to comprise all those risks associated with an investment in the Company and are not set out in any particular order of priority. Additional risks and uncertainties not currently known to the Directors may also have an adverse effect on the Company's business.

If any of the following risks actually occur, the Company's business, financial condition, capital resources, results or future operations could be materially adversely affected. In this event, the price of the Company's securities could decline and investors may lose all or part of their investment.

Forward-looking statements

This announcement includes "forward-looking statements" which include all statements other than statements of historical facts including, without limitation, those regarding the Group's financial position, business strategy, plans and objectives of management for future operations and any statements preceded by, followed by or that include forward-looking terminology such as the words "targets", "plan", "project", "believes", "estimates", "aims", "intends", "can", "may", "expects", "forecasts", "anticipates", "would", "should", "could" or similar expressions or the negative thereof. Such forward-looking statements involve known and unknown risks, uncertainties and other important factors beyond the Company's control that could cause the actual results, performance or achievements of the Company to be materially different from future results, performance or achievements expressed or implied by such forward-looking statements. Such forward-looking statements are based on numerous assumptions regarding the Company's present and future business strategies and the environment in which the Company will operate in the future. Among the important factors that could cause the Company's actual results, performance or achievements to differ materially from those in forward-looking statements include factors in this section entitled "Risk Factors" and elsewhere in this announcement. These forward-looking statements speak only as at the date of this announcement. The Company expressly disclaims any obligation or undertaking to disseminate any updates or revisions in relation to any forward-looking statements contained herein to reflect any change in the Company's expectations with regard thereto or any change in events, conditions or circumstances on which any such statements are based. As a result of these factors, the events described in the forward-looking statements in this announcement may not occur. Prospective investors should be aware that these statements are estimates, reflecting only the judgement of the Company's management and prospective investors should not rely on any forward-looking statements.

The Ordinary Shares should be regarded as a highly speculative investment and an investment in Ordinary Shares should only be made by those with the necessary expertise to fully evaluate the investment. In addition to the usual risks associated with an investment in a business which is at an early stage of development, the Directors believe that the risks set out in this section should be considered carefully by prospective investors before acquiring Ordinary Shares. Prospective investors are advised to consult an independent adviser authorised under FSMA (or equivalent in jurisdictions outside the UK). If any of the events or circumstances highlighted in this section of the announcement actually occur, the Company may not be able to conduct its business as currently planned, and its financial condition, operating results and cash flows could be seriously harmed. In those circumstances, the market price of the Ordinary Shares could decline, and all or part of an investment in the Ordinary Shares could be lost. No inference should be drawn as to the order in which the following risk factors are presented relative to the potential importance or effect of each listed factor.

PRINCIPAL RISK AND UNCERTAINTIES

Contracts with Mobile Network Operators

While Mobile Streams maintains relationships with numerous MNOs in the various territories in which it operates, a small number of MNOs account for a substantial proportion of the Company's business. Contracts with MNOs are typically entered into on the basis of an initial twelve month term, following which notice periods as short as 30 days apply. The loss or underperformance of any of the Company's contracts with MNOs could result in lower than expected turnover. Contracts with MNOs establish the proportion of the purchase price of a product receivable by Mobile Streams. The renegotiation of any of the Company's contracts with MNOs could result in lower than expected turnover or operating margins.

The Company seeks wherever possible to enter into contracts with MNOs on an exclusive basis, such that Mobile Streams is the sole provider of a range of products to an MNO's portal. If Mobile Streams is unable to negotiate such contracts in the future, or should any existing contracts become non-exclusive, the business, financial condition and operating results of the Company could be harmed.

Contracts with rights holders

The majority of content provided by Mobile Streams is licensed from rights holders, and the Company's ability to enter into revenue share agreements with MNOs and to attract customers through its own portals will depend to a significant extent upon the range and quality of content that Mobile Streams is able to source from rights holders. While Mobile Streams is not dependent on any single rights holder for its entertainment content, the termination or non-renewal of any existing licensing relationship could result in lower than expected turnover, and could adversely affect Mobile Streams' business, financial condition and operating results.

Mobile Streams seeks to maximise its turnover by sourcing entertainment content that it anticipates will attract high demand from consumers. The Company can give no assurance that it will predict consumer demand for entertainment content successfully.

Competition

The Company's business, financial condition and operating results may be adversely affected by competition from alternative providers of some or all of its products. Some of the products which Mobile Streams supplies can be sold directly to MNOs by major record labels without the need for an intermediary. In order to compete successfully, the Company will need to continue to develop its relationships with rights holders and MNOs. Other products can be transmitted to mobile devices without the need for an intermediary via alternative technologies.

The Company's competitors, and potential competitors, include larger companies who have greater capital, research, marketing, financial and personnel resources than those of Mobile Streams. There can be no assurance that the Company's competitors and potential competitors will not succeed in developing products or technologies which would render the Company's products obsolete or otherwise uncompetitive.

International customer base

Mobile Streams generates a significant part of its revenues from customers outside of the UK. The Company expects that its sales will continue to be made across a number of geographical regions for the foreseeable future and as a result, the occurrence of any negative international political, economic or geographical events could result in significant revenue shortfalls. These shortfalls could cause the Company's business to be harmed. Some of the risks of doing business internationally include:

· fluctuations in exchange rates;

· unexpected changes in regulatory environments;

· imposition of tariffs and other barriers and restrictions;

· burdens of complying with a variety of foreign laws;

· political and economic instability; and

· changes in diplomatic and trade relationships.

Dependence on key persons

Loss of key management or other key personnel (including regulated financial advisers), particularly to competitors, could have adverse consequences for the Group. Whilst the Group has entered into service agreements and/or letters of appointment with each of its Directors and certain senior employees, the retention of their services cannot be guaranteed. Furthermore, as the Group expands it will need to recruit and integrate additional personnel in a competitive market for qualified candidates. The Group may not be successful in identifying and engaging sufficient suitably qualified people or integrating them into the Group.

Intellectual property rights

The Group relies on a combination of trademarks, service marks and domain name registrations, common law copyright protection and contractual restrictions to establish and protect their intellectual property. Any third party may challenge the Group's intellectual property. The Group may incur substantial costs in defending any claims relating to its intellectual property rights.

There can be no guarantee that third parties have not and/or will not manage to independently develop software with the same functionality as the Group's products without infringing the Group's intellectual property rights, and there can be no guarantee that any such competing software would not have a material adverse effect on the position, financial performance, prospects or business of the Group.

Whilst it is impossible for the Directors to be aware of all third party intellectual property, they are of the opinion on the date of this announcement that the Group's products and services do not infringe the intellectual property rights of any third party. Third parties may potentially bring claims against the Group purporting that the Group and/or the products or services it delivers to customers infringe intellectual property rights belonging to those third parties. Any such claims, with or without merit, could be time consuming and expensive to defend or settle and could divert management resources and information.

Technology risk

The Group operates in an industry where competitive advantage is often dependent on technology. Technological developments may reduce the effectiveness of the Group's existing systems. Staying abreast of technological changes may require further investment by the Group in the future. The Group's success depends in part upon its ability to maintain and enhance its existing systems and to develop and introduce new systems.

Management controls and reporting procedures and execution

The ability of the Company to implement its strategy in a competitive market requires effective planning and management control systems. The Company's future growth will depend on its ability to expand and improve operational, financial and management information and control systems in line with the Company's growth. It will also depend on the Company's ability to develop services in line with the trends followed by its target customers, to leverage and expand its customer base and to provide quality products and services to its customers.

RISK FACTORS RELATING TO INDIA

Doing business in India

Part of the Group's operations are located in India which exposes it to risks over which it has no, or limited, control. These may include economic, social or political instability or change, currency non-convertibility or instability and changes of laws affecting foreign ownership, government participation, taxation, working conditions, exchange control and customs duties as well as government control over domestic production which could adversely affect the Group's financial condition and results of operations.

Whilst the Indian economy has sustained growth over the last several years and the Group's business plan is therefore based in part on continued economic growth, any slowdown in the growth of the Indian economy could have an adverse effect on the Group's results of operations and financial condition.

The Group's contracts with mobile network operators in India are governed by Indian law. The legal system in India is different to that of the UK. This could result in risks such as: (i) difficulties in obtaining effective legal redress in the courts of such jurisdictions, whether in respect of a breach of law or regulation, or in an ownership dispute; (ii) a higher degree of discretion on the part of governmental authorities; (iii) lack of judicial or administrative guidance on interpreting applicable rules and regulations; (iv) inconsistencies or conflicts between and within various laws, regulations, decrees, orders and resolutions; (v) relative inexperience of the judiciary and courts in such matters; and (vi) agreements in place may be susceptible to revision or cancellation and legal redress may be uncertain or delayed, the occurrence of any of which could have an adverse effect on the Group's results of operations and financial condition.

Enforcement of foreign awards in India

Courts in India may not enforce a provision of securities laws of any jurisdiction that is either penal in nature or contrary to public policy. An action brought pursuant to a public or penal law, the purpose of which is the enforcement of a sanction, power or right at the instance of the state in its sovereign capacity, is unlikely to be entertained by Indian courts. Specified remedies available under any jurisdiction, if they are considered to be contrary to Indian public policy, would not be available under Indian law or enforceable by Indian Courts.

Further, foreign judgments rendered by a superior court in any country or territory outside of India may only be recognised in India if such territory has been notified and/or declared to be a reciprocating territory by the Government of India. The enforceability of such judgments is subject to certain exceptions under the Civil Procedure Code, 1908 as regards its conclusiveness on any matter directly adjudicated upon.

If a judgment of a foreign court is not enforceable, a suit would have to be filed based on the judgment. A party seeking to enforce a foreign judgment in India is required to obtain prior approval from the Reserve Bank of India under the Foreign Exchange Management Act, 1999, as amended, to repatriate any amount recovered pursuant to such enforcement. Any judgment in a foreign currency would be converted into Indian rupees on the date of judgment and not on the date of payment.

It is unlikely that a court in India would award damages on the same basis as a foreign court if an action were brought in India. Furthermore, it is unlikely that an Indian court would enforce a foreign judgment if it viewed the amount of damages awarded as excessive or inconsistent with public policy or practice in India. It is difficult to predict whether a suit brought in an Indian court will be disposed of in a timely manner or be subject to untimely delay.

Any of these matters could make it difficult or impossible for the Company to enforce foreign awards or judgments against contract counterparties who are nationals or residents of India, including any award or judgment relating to the agreements with mobile network operators, and this could have a material adverse effect on the Group's business, financial conditions and results of operations.

Foreign country and political risk

A portion of the Group's activities are, and will be increasingly, located in India and, consequently, the Group is subject to certain risks, including possible political or economic instability, changes in laws relating to property ownership and/or state intervention in the operation of private businesses in India.

Any changes in regulations or shifts in political attitudes are beyond the control of the Group and may adversely affect the Group's results of operations and/or financial condition.

The Group's financial performance and the market price of the Ordinary Shares may be affected by changes in exchange rates and controls, interest rates, changes in government policies, including taxation policies, social and civil unrest and other political, social and economic developments in or affecting India.

The Government of India has exercised and continues to exercise significant influence over many aspects of the economy in India. Since 1991, successive Indian governments have sought to pursue policies of economic liberalisation and financial sector reforms, including by relaxing restrictions on the private sector. Nevertheless, the role of the Indian central and state governments in the Indian economy as producers, consumers and regulators has remained significant, and there is no guarantee that liberalisation policies will continue. Recent governments have been multiparty coalitions and have often faced difficulty in generating sufficient cross-party support to implement reform-oriented policies or initiatives. The rate of economic liberalisation could change, and specific laws and policies affecting technology companies, foreign investments, currency exchange rates and other matters affecting investments in India could change as well. A significant change in India's policy of economic liberalisation and deregulation or any social or political uncertainties could adversely affect business and economic conditions in India generally and the business, financial condition, results of operations and prospects of the Group.

Economic outlook

The Group's revenue is dependent on user subscription numbers so the Group is sensitive to the impacts of the general economic climate in India and on the population's propensity to spend on mobile technology. Factors such as household disposable income, sales seasonality, changing demographics and access to the internet may affect demand for the Group's products. Global economic factors may impact the costs of inputs and the Group's ability to pass on such cost increases may be limited, affecting the Group's profit performance.

Fluctuations in revenue and delay in receipt of net revenue payment

The Group's revenues in India are difficult to forecast and, given the early stage of its activities in India, may fluctuate significantly between reporting periods as a result of factors that are largely outside of the control of the Group. These factors include delays in customer payments or the ability of its customers to pay at all, fluctuations in the number of subscribers, seasonal and economic patterns and trends and the discretionary nature of consumer spending. In particular, the Group's model is dependent on receiving the net revenue share payment from the mobile network operators in India within 3 months of the revenue being incurred. Should this payment not be received either within the anticipated timeframe or, indeed, at all then the Group will be unable to continue to fund its growth in India and may need to secure external financing. Any of these factors may affect the markets for the products and services the Group offers.

Foreign investment

India regulates ownership of Indian companies by foreigners, although some restrictions on foreign investment have been relaxed in recent years. These regulations and restrictions may apply to the Group's ownership of Mobile Streams India Private Limited or the provision of funding by the Group. For example, under its Consolidated Foreign Direct Investment Policy, the Government of India has specific requirements with respect to: (i) investments by Indian companies owned or controlled by foreign entities; and (ii) the transfer of ownership or control of Indian companies in certain sectors from resident Indian persons or entities to foreigners in India. Foreign direct investment is restricted in ''retail trading'' businesses, with 51 per cent. foreign direct investment permitted in multi-brand retail trading and 100 per cent. foreign direct investment permitted in single brand retail trading, subject to, in each case, prior approval from the Government of India and certain other conditions specified in the consolidated foreign direct investment policy.

These and other requirements, which currently include restrictions on valuations and sources of funding for such investments and may include prior government approval, may adversely affect the Group's ability to make further investments in India. As the Group does not and will not engage in ''retail trading'' so long as these restrictions remain in place, the Group may be unable to develop its business or take advantage of acquisition or other growth opportunities in ways that would be well suited to the existing business platform, which would adversely affect the Group's business or prospects.

Repatriation of earnings and withholding tax

Under the current Indian tax legislation, any dividends declared by Mobile Streams India Private Limited and received by the Company would be subject to additional dividend distribution tax payable by Mobile Streams India Private Limited at the rate of approximately 17 per cent. and such dividends would be exempt from taxation in India in the hands of the Company. If any royalties and management service charges are received by the Company from Mobile Streams India Private Limited, they will be subject to withholding tax in India. Withholding tax will be credited in the UK against any UK tax on the Company on this income. Any changes to the current rules relating to dividend distribution tax or withholding tax in India or any other relevant jurisdiction could have a material adverse effect on the business, financial condition, results of operations and prospects of the Group.

APPENDIX - TERMS AND CONDITIONS OF THE PLACING

IMPORTANT INFORMATION FOR INVITED PLACEES ONLY REGARDING THE PLACING.

THIS ANNOUNCEMENT, INCLUDING THIS APPENDIX AND THE INFORMATION CONTAINED HEREIN (TOGETHER THE "ANNOUNCEMENT") IS RESTRICTED AND IS NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, IN WHOLE OR IN PART, DIRECTLY OR INDIRECTLY, IN OR INTO OR FROM THE UNITED STATES, THE REPUBLIC OF IRELAND, AUSTRALIA, CANADA, JAPAN, THE REPUBLIC OF SOUTH AFRICA OR ANY OTHER JURISDICTION IN WHICH SUCH RELEASE, PUBLICATION OR DISTRIBUTION WOULD BE UNLAWFUL. THIS ANNOUNCEMENT HAS NOT BEEN APPROVED BY THE LONDON STOCK EXCHANGE, NOR IS IT INTENDED THAT IT WILL BE SO APPROVED.

MEMBERS OF THE PUBLIC ARE NOT ELIGIBLE TO TAKE PART IN THE PLACING. THIS ANNOUNCEMENT IS FOR INFORMATION PURPOSES ONLY AND IS DIRECTED ONLY AT: (A) PERSONS IN MEMBER STATES OF THE EUROPEAN ECONOMIC AREA ("EEA") WHO ARE QUALIFIED INVESTORS AS DEFINED IN SECTION 86(7) OF THE FINANCIAL SERVICES AND MARKETS ACT 2000, AS AMENDED ("QUALIFIED INVESTORS"), BEING PERSONS FALLING WITHIN THE MEANING OF ARTICLE 2(1)(e) OF DIRECTIVE 2003/71/EC AS AMENDED, INCLUDING BY THE 2010 PROSPECTUS DIRECTIVE AMENDING DIRECTIVE (DIRECTIVE 2010/73/EC) AND TO THE EXTENT IMPLEMENTED IN THE RELEVANT MEMBER STATE (THE "PROSPECTUS DIRECTIVE"); AND (B) IN THE UNITED KINGDOM, QUALIFIED INVESTORS WHO ARE PERSONS WHO (I) HAVE PROFESSIONAL EXPERIENCE IN MATTERS RELATING TO INVESTMENTS FALLING WITHIN ARTICLE 19(5) (INVESTMENT PROFESSIONALS) OF THE FINANCIAL SERVICES AND MARKETS ACT 2000 (FINANCIAL PROMOTION) ORDER 2005, AS AMENDED (THE "ORDER"); (II) ARE PERSONS FALLING WITHIN ARTICLE 49(2)(A) TO (D) (HIGH NET WORTH COMPANIES, UNINCORPORATED ASSOCIATIONS, ETC.) OF THE ORDER; OR (III) ARE PERSONS TO WHOM IT MAY OTHERWISE BE LAWFULLY COMMUNICATED (ALL SUCH PERSONS TOGETHER BEING REFERRED TO AS "RELEVANT PERSONS").

THIS ANNOUNCEMENT AND THE INFORMATION IN IT MUST NOT BE ACTED ON OR RELIED ON BY PERSONS WHO ARE NOT RELEVANT PERSONS. PERSONS DISTRIBUTING THIS ANNOUNCEMENT MUST SATISFY THEMSELVES THAT IT IS LAWFUL TO DO SO. ANY INVESTMENT OR INVESTMENT ACTIVITY TO WHICH THIS ANNOUNCEMENT RELATES IS AVAILABLE ONLY TO RELEVANT PERSONS AND WILL BE ENGAGED IN ONLY WITH RELEVANT PERSONS. THIS ANNOUNCEMENT DOES NOT ITSELF CONSTITUTE AN OFFER FOR SALE OR SUBSCRIPTION OF ANY SECURITIES IN MOBILE STREAMS PLC.

THIS ANNOUNCEMENT IS NOT AN OFFER OF SECURITIES FOR SALE INTO THE UNITED STATES. THE PLACING SHARES HAVE NOT BEEN AND WILL NOT BE REGISTERED UNDER THE UNITED STATES SECURITIES ACT 1933, AS AMENDED (THE "SECURITIES ACT") OR WITH ANY SECURITIES REGULATORY AUTHORITY OF ANY STATE OR JURISDICTION OF THE UNITED STATES, AND MAY NOT BE OFFERED, SOLD OR TRANSFERRED, DIRECTLY OR INDIRECTLY, IN THE UNITED STATES EXCEPT PURSUANT TO AN EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND IN COMPLIANCE WITH ANY APPLICABLE SECURITIES LAWS OF ANY STATE OR OTHER JURISDICTION OF THE UNITED STATES. SUBJECT TO CERTAIN EXCEPTIONS AND AT THE SOLE DISCRETION OF THE COMPANY, THE PLACING SHARES ARE BEING OFFERED AND SOLD ONLY OUTSIDE THE UNITED STATES IN "OFFSHORE TRANSACTIONS" WITHIN THE MEANING OF, AND IN ACCORDANCE WITH, REGULATION S UNDER THE SECURITIES ACT AND OTHERWISE IN ACCORDANCE WITH APPLICABLE LAWS. NO PUBLIC OFFERING OF THE PLACING SHARES IS BEING MADE IN THE UNITED STATES, THE UNITED KINGDOM OR ELSEWHERE. NO MONEY, SECURITIES OR OTHER CONSIDERATION FROM ANY PERSON INSIDE THE UNITED STATES IS BEING SOLICITED AND, IF SENT IN RESPONSE TO THE INFORMATION CONTAINED IN THIS ANNOUNCEMENT, WILL NOT BE ACCEPTED.

EACH PLACEE SHOULD CONSULT WITH ITS ADVISERS AS TO LEGAL, TAX, BUSINESS AND RELATED ASPECTS OF AN INVESTMENT IN PLACING SHARES. THE DISTRIBUTION OF THIS ANNOUNCEMENT, ANY PART OF IT OR ANY INFORMATION CONTAINED IN IT MAY BE RESTRICTED BY LAW IN CERTAIN JURISDICTIONS, AND ANY PERSON INTO WHOSE POSSESSION THIS ANNOUNCEMENT, ANY PART OF IT OR ANY INFORMATION CONTAINED IN IT COMES SHOULD INFORM THEMSELVES ABOUT, AND OBSERVE, SUCH RESTRICTIONS.

No action has been taken by the Company, N+1 Singer Advisory LLP ("N+1 Singer") or any of their respective affiliates, agents, directors, officers or employees that would permit an offer of the Placing Shares or possession or distribution of this Announcement or any other offering or publicity material relating to such Placing Shares in any jurisdiction where action for that purpose is required.

This Announcement or any part of it does not constitute or form part of any offer to issue or sell, or the solicitation of an offer to acquire, purchase or subscribe for, any securities in the United States (including its territories and possessions, any state of the United States and the District of Columbia), Canada, the Republic of Ireland, Australia, the Republic of South Africa, Japan or any other jurisdiction in which the same would be unlawful. No public offering of the Placing Shares is being made in any such jurisdiction.

All offers of the Placing Shares will be made pursuant to an exemption under the Prospectus Directive from the requirement to produce a prospectus. In the United Kingdom, this Announcement is being directed solely at persons in circumstances in which section 21(1) of the Financial Services and Markets Act 2000 (as amended) (the "FSMA") does not apply.

The Placing Shares have not been approved or disapproved by the US Securities and Exchange Commission, any state securities commission or other regulatory authority in the United States, nor have any of the foregoing authorities passed upon or endorsed the merits of the Placing or the accuracy or adequacy of this Announcement. Any representation to the contrary is a criminal offence in the United States. The relevant clearances have not been, nor will they be, obtained from the securities commission of any province or territory of Canada, no prospectus has been lodged with, or registered by, the Australian Securities and Investments Commission or the Japanese Ministry of Finance; the relevant clearances have not been, and will not be, obtained for the South Africa Reserve Bank or any other applicable body in the Republic of South Africa in relation to the Placing Shares and the Placing Shares have not been, nor will they be, registered under or offering in compliance with the securities laws of any state, province or territory of Australia, Canada, Japan or the Republic of South Africa. Accordingly, the Placing Shares may not (unless an exemption under the relevant securities laws is applicable) be offered, sold, resold or delivered, directly or indirectly, in or into Australia, Canada, Japan or the Republic of South Africa or any other jurisdiction outside the United Kingdom.

Persons (including, without limitation, nominees and trustees) who have a contractual right or other legal obligations to forward a copy of this Announcement should seek appropriate advice before taking any action.

This Announcement should be read in its entirety. In particular, you should read and understand the information provided in this "Important Information" section of this Announcement.

By participating in the Placing, each person who is invited to and who chooses to participate in the Placing (a "Placee") will be deemed to have read and understood this Announcement in its entirety, to be participating, making an offer and acquiring Placing Shares on the terms and conditions contained herein and to be providing the representations, warranties, indemnities, acknowledgements and undertakings contained in this Appendix.

In particular, each such Placee represents, warrants, undertakes, agrees and acknowledges (amongst other things) that:

1 it is a Relevant Person and undertakes that it will acquire, hold, manage or dispose of any Placing Shares that are allocated to it for the purposes of its business;

2 in the case of a Relevant Person in a member state of the EEA which has implemented the Prospectus Directive (each, a "Relevant Member State") who acquires any Placing Shares pursuant to the Placing:

2.1 it is a Qualified Investor within the meaning of Article 2(1)(e) of the Prospectus Directive;

2.2 in the case of any Placing Shares acquired by it as a financial intermediary, as that term is used in Article 3(2) of the Prospectus Directive:

2.2.1 the Placing Shares acquired by it in the Placing have not been acquired on behalf of, nor have they been acquired with a view to their offer or resale to, persons in any Relevant Member State other than Qualified Investors or in circumstances in which the prior consent of N+1 Singer has been given to the offer or resale; or

2.2.2 where Placing Shares have been acquired by it on behalf of persons in any member state of the EEA other than Qualified Investors, the offer of those Placing Shares to it is not treated under the Prospectus Directive as having been made to such persons;

3 it is acquiring the Placing Shares for its own account or is acquiring the Placing Shares for an account with respect to which it exercises sole investment discretion and has the authority to make and does make the representations, warranties, indemnities, acknowledgements, undertakings and agreements contained in this Announcement;

4 it understands (or if acting for the account of another person, such person has confirmed that such person understands) the resale and transfer restrictions set out in this Appendix; and

5 except as otherwise permitted by the Company and subject to any available exemptions from applicable securities laws, it (and any account referred to in paragraph 3 above) is outside the United States acquiring the Placing Shares in offshore transactions as defined in and in accordance with Regulation S under the Securities Act.

No prospectus

No prospectus or other offering document has been or will be submitted to be approved by the FCA in relation to the Placing or the Placing Shares and Placees' commitments will be made solely on the basis of the information contained in this Announcement and any information publicly announced through a Regulatory Information Service (as defined in the AIM Rules for Companies (the "AIM Rules")) by or on behalf of the Company on or prior to the date of this Announcement (the "Publicly Available Information") and subject to any further terms set forth in the form of confirmation to be sent to individual Placees.

Each Placee, by participating in the Placing, agrees that the content of this Announcement is exclusively the responsibility of the Company and confirms that it has not relied on any information (other than the Publicly Available Information), representation, warranty or statement made by or on behalf of N+1 Singer, the Company or any other person and none of N+1 Singer, the Company or any other person acting on such person's behalf nor any of their respective affiliates has or shall have any liability for any Placee's decision to participate in the Placing based on any other information, representation, warranty or statement. Each Placee acknowledges and agrees that it has relied on its own investigation of the business, financial or other position of the Company in accepting a participation in the Placing. Nothing in this paragraph shall exclude the liability of any person for fraudulent misrepresentation.

Details of the Placing Agreement and the Placing Shares

N+1 Singer has today entered into a placing agreement (the "Placing Agreement") with the Company under which, on the terms and subject to the conditions set out in the Placing Agreement, N+1 Singer, as agent for and on behalf of the Company, has agreed to use its reasonable endeavours to procure Placees for the Placing Shares at the Placing Price.

The Placing Shares will, when issued, be subject to the articles of association of the Company and credited as fully paid and will rank pari passu in all respects with the Existing Ordinary Shares in the capital of the Company, including the right to receive all dividends and other distributions declared, made or paid in respect of such Ordinary Shares after the date of issue of the Placing Shares.

Application for admission to trading

Application will be made to the London Stock Exchange for admission of the Placing Shares to trading on AIM.

It is expected that Admission will take place no later than 20 December 2016 and that dealings in the Placing Shares on AIM will commence at the same time.

Principal terms of the Placing

1 N+1 Singer is acting as nominated adviser, financial adviser and broker to the Placing, as agent for and on behalf of the Company. N+1 Singer is authorised and regulated in the United Kingdom by the Financial Conduct Authority ("FCA") and is acting exclusively for the Company and no one else in connection with the matters referred to in this Announcement and will not be responsible to anyone other than the Company for providing the protections afforded to the customers of N+1 Singer or for providing advice in relation to the matters described in this Announcement.

2 Participation in the Placing will only be available to persons who may lawfully be, and are, invited by N+1 Singer to participate. N+1 Singer and any of its respective affiliates are entitled to participate in the Placing as principal.

3 The price per Placing Share (the "Placing Price") is fixed at 4 pence and is payable to N+1 Singer by all Placees.

4 Each Placee's allocation is determined by N+1 Singer in its discretion following consultation with the Company and has been or will be confirmed orally by N+1 Singer and a form of confirmation will be dispatched as soon as possible thereafter. That oral confirmation will give rise to an irrevocable, legally binding commitment by that person (who at that point becomes a Placee), in favour of N+1 Singer and the Company, under which it agrees to acquire the number of Placing Shares allocated to the Placee at the Placing Price and otherwise on the terms and subject to the conditions set out in this Appendix and in accordance with the Company's articles of association. Except with N+1 Singer's written consent, such commitment will not be capable of variation or revocation at the time at which it is submitted.

5 Each Placee's allocation and commitment will be evidenced by a form of confirmation issued to such Placee by N+1 Singer. The terms of this Appendix will be deemed incorporated in that form of confirmation.

6 Each Placee will have an immediate, separate, irrevocable and binding obligation, owed to N+1 Singer (as agent for the Company), to pay to it (or as it may direct) in cleared funds an amount equal to the product of the Placing Price and the number of Placing Shares such Placee has agreed to acquire and the Company has agreed to allot and issue to that Placee.

7 Irrespective of the time at which a Placee's allocation(s) pursuant to the Placing is/are confirmed, settlement for all Placing Shares to be acquired pursuant to the Placing will be required to be made at the same time, on the basis explained below under "Registration and Settlement".

8 All obligations of N+1 Singer under the Placing will be subject to fulfilment of the conditions referred to below under "Conditions of the Placing" and to the Placing not being terminated on the basis referred to below under "Termination of the Placing".

9 By participating in the Placing, each Placee will agree that its rights and obligations in respect of the Placing will terminate only in the circumstances described below and will not be capable of rescission or termination by the Placee.

10 To the fullest extent permissible by law and applicable FCA rules, none of (a) N+1 Singer, (b) any of N+1 Singer's affiliates, agents, directors, officers, consultants, (c) to the extent not contained within (a) or (b), any person connected with N+1 Singer as defined in FSMA ((b) and (c) being together "affiliates" and individually an "affiliate" of N+1 Singer), (d) any person acting on N+1 Singer's behalf, shall have any liability (including to the extent permissible by law, any fiduciary duties) to Placees or to any other person whether acting on behalf of a Placee or otherwise. In particular, neither N+1 Singer nor any of its respective affiliates shall have any liability (including, to the extent permissible by law, any fiduciary duties) in respect of their conduct of the Placing or of such alternative method of effecting the Placing as N+1 Singer and the Company may agree.

Registration and Settlement

If Placees are allocated any Placing Shares in the Placing they will be sent a form of confirmation or electronic confirmation by N+1 Singer, as soon as it is able which will confirm the number of Placing Shares allocated to them, the Placing Price and the aggregate amount owed by them to N+1 Singer.

Each Placee will be deemed to agree that it will do all things necessary to ensure that delivery and payment is completed as directed by N+1 Singer in accordance with either the standing CREST or certificated settlement instructions which they have in place with N+1 Singer.

Settlement of transactions in the Placing Shares (ISIN: GB00B0WJ3L68) following Admission will take place within the CREST system, subject to certain exceptions. Settlement through CREST is expected to take place on 20 December 2016 unless otherwise notified by N+1 Singer and Admission is expected to occur no later than 8.00 a.m. on 20 December 2016 unless otherwise notified by N+1 Singer. Admission and Settlement may occur at an earlier date, which if achievable, will be set out in the Circular. Settlement will be on a delivery versus payment basis. However, in the event of any difficulties or delays in the admission of the Placing Shares to CREST or the use of CREST in relation to the Placing, the Company and N+1 Singer may agree that the Placing Shares should be issued in certificated form. N+1 Singer reserves the right to require settlement for the Placing Shares, and to deliver the Placing Shares to Placees, by such other means as they deem necessary if delivery or settlement to Placees is not practicable within the CREST system or would not be consistent with regulatory requirements in a Placee's jurisdiction.

Interest is chargeable daily on payments not received from Placees on the due date in accordance with the arrangements set out above, in respect of either CREST or certificated deliveries, at the rate of 2 percentage points above prevailing LIBOR as determined by N+1 Singer.

Each Placee is deemed to agree that if it does not comply with these obligations, N+1 Singer may sell any or all of their Placing Shares on their behalf and retain from the proceeds, for N+1 Singer's own account and benefit, an amount equal to the aggregate amount owed by the Placee plus any interest due. The relevant Placee will, however, remain liable for any shortfall below the amount owed by it and for any stamp duty or stamp duty reserve tax (together with any interest or penalties) which may arise upon the sale of their Placing Shares on their behalf.

If Placing Shares are to be delivered to a custodian or settlement agent, Placees must ensure that, upon receipt, the conditional form of confirmation is copied and delivered immediately to the relevant person within that organisation. Insofar as Placing Shares are registered in a Placee's name or that of its nominee or in the name of any person for whom a Placee is contracting as agent or that of a nominee for such person, such Placing Shares should, subject as provided below, be so registered free from any liability to United Kingdom stamp duty or stamp duty reserve tax. Placees will not be entitled to receive any fee or commission in connection with the Placing.

Conditions of the Placing

The Placing is conditional upon the Placing Agreement becoming unconditional and not having been terminated in accordance with its terms.

The obligations of N+1 Singer under the Placing Agreement are, and the Placing is, conditional upon, inter alia:

(a) the passing of the Placing Resolutions (without any amendment which has not been previously approved by N+1 Singer) by 5.00 p.m. on the day of the General Meeting;

(b) none of the warranties or undertakings on the part of the Company contained in the Placing Agreement being or having become untrue, inaccurate or misleading at any time before Admission, and no fact or circumstance having arisen which would constitute a breach of any of the Warranties or undertakings given in the Placing Agreement or which would constitute a Specified Event under the Placing Agreement;

(c) the performance by the Company of its obligations under the Placing Agreement to the extent that they fall to be performed prior to Admission;

(d) Admission occurring by not later than 8.00 a.m. on 20 December 2016 (or such later date as the Company and N1 Singer may agree in writing, in any event being not later than 30 December 2016),

(all conditions to the obligations of N+1 Singer included in the Placing Agreement being together, the "conditions").

If any of the conditions set out in the Placing Agreement are not fulfilled or, where permitted, waived in accordance with the Placing Agreement within the stated time periods (or such later time and/or date as the Company and N+1 Singer may agree, provided that the time for satisfaction of the condition set out in (d) above shall not be extended beyond 8.00 a.m. on 30 December 2016), or the Placing Agreement is terminated in accordance with its terms, the Placing will lapse and the Placee's rights and obligations shall cease and terminate at such time and each Placee agrees that no claim can be made by or on behalf of the Placee (or any person on whose behalf the Placee is acting) in respect thereof.

By participating in the Placing, each Placee agrees that its rights and obligations cease and terminate only in the circumstances described above and under "Termination of the Placing" below and will not be capable of rescission or termination by it.

Certain conditions may be waived in whole or in part by N+1 Singer, in its absolute discretion by notice in writing to the Company and N+1 Singer may also agree in writing with the Company to extend the time for satisfaction of any condition. Any such extension or waiver will not affect Placees' commitments as set out in this Announcement.

N+1 Singer may terminate the Placing Agreement in certain circumstances, details of which are set out below.

Neither N+1 Singer, the Company nor any of their respective affiliates, agents, directors, officers, employees shall have any liability to any Placee (or to any other person whether acting on behalf of a Placee or otherwise) in respect of any decision any of them may make as to whether or not to waive or to extend the time and/or date for the satisfaction of any condition to the Placing nor for any decision any of them may make as to the satisfaction of any condition or in respect of the Placing generally and by participating in the Placing each Placee agrees that any such decision is within the absolute discretion of N+1 Singer.

Termination of the Placing

N+1 Singer may terminate the Placing Agreement, in accordance with its terms, at any time prior to Admission if, inter alia:

1 it comes to the attention of N+1 Singer that any of the warranties were not true or accurate, or were misleading when given or deemed given; or

2 it comes to the attention of N+1 Singer that the Company has failed to comply with its obligations under the Placing Agreement, FSMA, the AIM Rules or other applicable law; or

3 it comes to the attention of N+1 Singer that any statement contained in the Circular or the Issue Documents has become or been discovered to be untrue, inaccurate or misleading; or

4 the occurrence of an adverse change in (amongst other things) national or international financial or political conditions (which in the reasonable opinion of N+1 Singer will or is likely to be prejudicial to the Group or to the Fundraising or Admission); or

5 any event or omission occurs which materially and adversely affects the financial position and/or prospects of the Group or which in the opinion of N+1 Singer is or will or is likely to materially and adversely affect the Group or the Fundraising; or

6 the Group's situation is such that Admission may, in the opinion of N+1 Singer, be detrimental to the ordinary operation or reputation of AIM

If the Placing Agreement is terminated in accordance with its terms, the rights and obligations of each Placee in respect of the Placing as described in this Announcement shall cease and terminate at such time and no claim can be made by any Placee in respect thereof.

By participating in the Placing, each Placee agrees with the Company and N+1 Singer that the exercise by the Company or N+1 Singer of any right of termination or any other right or other discretion under the Placing Agreement shall be within the absolute discretion of the Company or N+1 Singer and that neither of the Company nor N+1 Singer need make any reference to such Placee and that neither N+1 Singer, the Company, nor any of their respective affiliates, agents, directors, officers or employees shall have any liability to such Placee (or to any other person whether acting on behalf of a Placee or otherwise) whatsoever in connection with any such exercise.

By participating in the Placing, each Placee agrees that its rights and obligations terminate only in the circumstances described above and under the "Conditions of the Placing" section above and will not be capable of rescission or termination by it after the issue by N+1 Singer of a form of confirmation confirming each Placee's allocation and commitment in the Placing.

Representations, warranties and further terms

By participating in the Placing, each Placee (and any person acting on such Placee's behalf) represents, warrants, acknowledges and agrees (for itself and for any such prospective Placee) that (save where N+1 Singer expressly agree in writing to the contrary):

1 it has read and understood this Announcement in its entirety and that its acquisition of the Placing Shares is subject to and based upon all the terms, conditions, representations, warranties, indemnities, acknowledgements, agreements and undertakings and other information contained herein and that it has not relied on, and will not rely on, any information given or any representations, warranties or statements made at any time by any person in connection with Admission, the Placing, the Company, the Placing Shares or otherwise, other than the information contained in this Announcement and the Publicly Available Information;

2 it has not received a prospectus or other offering document in connection with the Placing and acknowledges that no prospectus or other offering document: (a) is required under the Prospectus Directive; and (b) has been or will be prepared in connection with the Placing;

3 the Ordinary Shares are admitted to trading on AIM, and that the Company is therefore required to publish certain business and financial information in accordance with the AIM Rules, which includes a description of the nature of the Company's business and the Company's most recent balance sheet and profit and loss account and that it is able to obtain or access such information without undue difficulty, and is able to obtain access to such information or comparable information concerning any other publicly traded company, without undue difficulty;

4 it has made its own assessment of the Placing Shares and has relied on its own investigation of the business, financial or other position of the Company in accepting a participation in the Placing and neither N+1 Singer, the Company nor any of their respective affiliates, agents, directors, officers or employees or any person acting on behalf of any of them has provided, and will not provide, it with any material regarding the Placing Shares or the Company or any other person other than the information in this Announcement, or the Publicly Available Information; nor has it requested neither of N+1 Singer, the Company, any of their respective affiliates, agents, directors, officers or employees or any person acting on behalf of any of them to provide it with any such information;

5 neither N+1 Singer, any person acting on behalf of them or any of their respective affiliates, agents, directors, officers or employees has or shall have any liability for any Publicly Available Information, or any representation relating to the Company, provided that nothing in this paragraph excludes the liability of any person for fraudulent misrepresentation made by that person;

6 the only information on which it is entitled to rely on and on which it has relied in committing to subscribe for the Placing Shares is contained in the Publicly Available Information: (a) such information being all that it deems necessary to make an investment decision in respect of the Placing Shares and it has made its own assessment of the Company, the Placing Shares and the terms of the Placing based on Publicly Available Information; (b) neither N+1 Singer, the Company nor any of their respective affiliates, agents, directors, officers or employees has made any representation or warranty to it, express or implied, with respect to the Company, the Placing or the Placing Shares or the accuracy, completeness or adequacy of the Publicly Available Information; (c) it has conducted its own investigation of the Company, the Placing and the Placing Shares, satisfied itself that the information is still current and relied on that investigation for the purposes of its decision to participate in the Placing; and (d) has not relied on any investigation that N+1 Singer or any person acting on their behalf may have conducted with respect to the Company, the Placing or the Placing Shares;

7 the content of this Announcement and the Publicly Available Information has been prepared by and is exclusively the responsibility of the Company and that neither N+1 Singer nor any persons acting on behalf of it is responsible for or has or shall have any liability for any information, representation, warranty or statement relating to the Company contained in this Announcement or the Publicly Available Information nor will they be liable for any Placee's decision to participate in the Placing based on any information, representation, warranty or statement contained in this Announcement, the Publicly Available Information or otherwise. Nothing in this Appendix shall exclude any liability of any person for fraudulent misrepresentation;

8 the Placing Shares have not been registered or otherwise qualified, and will not be registered or otherwise qualified, for offer and sale nor will a prospectus be cleared or approved in respect of any of the Placing Shares under the securities laws of the United States, or any state or other jurisdiction of the United States, the Republic of Ireland, Australia, Canada, Republic of South Africa or Japan and, subject to certain exceptions, may not be offered, sold, taken up, renounced or delivered or transferred, directly or indirectly, within the United States, the Republic of Ireland, Australia, Canada, South Africa or Japan or in any country or jurisdiction where any such action for that purpose is required;

9 it and/or each person on whose behalf it is participating:

9.1 is entitled to acquire Placing Shares pursuant to the Placing under the laws and regulations of all relevant jurisdictions;

9.2 has fully observed such laws and regulations;

9.3 has capacity and authority and is entitled to enter into and perform its obligations as an acquirer of Placing Shares and will honour such obligations; and

9.4 has obtained all necessary consents and authorities (including, without limitation, in the case of a person acting on behalf of a Placee, all necessary consents and authorities to agree to the terms set out or referred to in this Appendix) under those laws or otherwise and complied with all necessary formalities to enable it to enter into the transactions contemplated hereby and to perform its obligations in relation thereto and, in particular, if it is a pension fund or investment company it is aware of and acknowledges it is required to comply with all applicable laws and regulations with respect to its subscription for Placing Shares;

10 it is not, and any person who it is acting on behalf of is not, and at the time the Placing Shares are subscribed will not be, a resident of, or with an address in, or subject to the laws of, Australia, Canada, Japan, the Republic of Ireland or the Republic of South Africa, and it acknowledges and agrees that the Placing Shares have not been and will not be registered or otherwise qualified under the securities legislation of Australia, Canada, Japan, the Republic of Ireland or the Republic of South Africa and may not be offered, sold, or acquired, directly or indirectly, within those jurisdictions;

11 the Placing Shares have not been, and will not be, registered under the Securities Act and may not be offered, sold or resold in or into or from the United States except pursuant to an effective registration under the Securities Act, or pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act and in accordance with applicable state securities laws; and no representation is being made as to the availability of any exemption under the Securities Act for the reoffer, resale, pledge or transfer of the Placing Shares;

12 it and the beneficial owner of the Placing Shares is, and at the time the Placing Shares are acquired will be, outside the United States and acquiring the Placing Shares in an "offshore transaction" as defined in, and in accordance with, Regulation S under the Securities Act;

13 it (and any account for which it is purchasing) is not acquiring the Placing Shares with a view to any offer, sale or distribution thereof within the meaning of the Securities Act;

14 it will not distribute, forward, transfer or otherwise transmit this Announcement or any part of it, or any other presentational or other materials concerning the Placing in or into or from the United States (including electronic copies thereof) to any person, and it has not distributed, forwarded, transferred or otherwise transmitted any such materials to any person;

15 neither N+1 Singer, its respective affiliates, agents, directors, officers or employees nor any person acting on behalf of any of them is making any recommendations to it, advising it regarding the suitability of any transactions it may enter into in connection with the Placing and that participation in the Placing is on the basis that it is not and will not be a client of N+1 Singer and N+1 Singer has no duties or responsibilities to it for providing the protections afforded to its clients or for providing advice in relation to the Placing nor in respect of any representations, warranties, undertakings or indemnities contained in the Placing Agreement nor for the exercise or performance of any of its rights and obligations thereunder including any rights to waive or vary any conditions or exercise any termination right;

16 it has the funds available to pay for the Placing Shares for which it has agreed to subscribe and acknowledges and agrees that it will make payment to N+1 Singer for the Placing Shares allocated to it in accordance with the terms and conditions of this Announcement on the due times and dates set out in this Announcement, failing which the relevant Placing Shares may be placed with others on such terms as N+1 Singer may, in its absolute discretion determine without liability to the Placee and it will remain liable for any shortfall below the net proceeds of such sale and the placing proceeds of such Placing Shares and may be required to bear any stamp duty or stamp duty reserve tax (together with any interest or penalties due pursuant to the terms set out or referred to in this Announcement) which may arise upon the sale of such Placee's Placing Shares on its behalf;

17 no action has been or will be taken by any of the Company, N+1 Singer or any person acting on their behalf that would, or is intended to, permit a public offer of the Placing Shares in the United States or in any country or jurisdiction where any such action for that purpose is required;

18 the person who it specifies for registration as holder of the Placing Shares will be: (a) the Placee; or (b) a nominee of the Placee, as the case may be. Neither N+1 Singer nor the Company will be responsible for any liability to stamp duty or stamp duty reserve tax resulting from a failure to observe this requirement. Each Placee and any person acting on behalf of such Placee agrees to acquire Placing Shares pursuant to the Placing and agrees to pay the Company and N+1 Singer in respect of the same (including any interest or penalties) on the basis that the Placing Shares will be allotted to a CREST stock account of N+1 Singer or transferred to a CREST stock account of N+1 Singer who will hold them as nominee on behalf of the Placee until settlement in accordance with its standing settlement instructions with it;

19 it is acting as principal only in respect of the Placing or, if it is acting for any other person, (a) it is duly authorised to do so and has full power to make the acknowledgments, representations and agreements herein on behalf of each such person and (b) it is and will remain liable to the Company and N+1 Singer for the performance of all its obligations as a Placee in respect of the Placing (regardless of the fact that it is acting for another person);

20 the allocation, allotment, issue and delivery to it, or the person specified by it for registration as holder, of Placing Shares will not give rise to a stamp duty or stamp duty reserve tax liability under (or at a rate determined under) any of sections 67, 70, 93 or 96 of the Finance Act 1986 (depository receipts and clearance services) and that it is not participating in the Placing as nominee or agent for any person or persons to whom the allocation, allotment, issue or delivery of Placing Shares would give rise to such a liability;

21 it and any person acting on its behalf (if within the United Kingdom) falls within Article 19(5) and/or 49(2) of the Order and undertakes that it will acquire, hold, manage and (if applicable) dispose of any Placing Shares that are allocated to it for the purposes of its business only;

22 it will not make an offer to the public of the Placing Shares and it has not offered or sold and will not offer or sell any Placing Shares to persons in the United Kingdom or elsewhere in the EEA prior to the expiry of a period of six months from Admission except to persons whose ordinary activities involve them in acquiring, holding, managing or disposing of investments (as principal or agent) for the purposes of their business or otherwise in circumstances which have not resulted and which will not result in an offer to the public in the United Kingdom within the meaning of section 85(1) of the FSMA or an offer to the public in any other member state of the EEA within the meaning of the Prospectus Directive;

23 it is a person of a kind described in: (a) Article 19(5) (Investment Professionals) and/or 49(2) (High net worth companies etc.) of the Order, and/or an authorised person as defined in section 31 of FSMA; and (b) section 86(7) of FSMA ("Qualified Investor"), being a person falling within Article 2.1(e) the Prospectus Directive. For such purposes, it undertakes that it will acquire, hold, manage and (if applicable) dispose of any Placing Shares that are allocated to it for the purposes of its business only;

24 it has only communicated or caused to be communicated and it will only communicate or cause to be communicated any invitation or inducement to engage in investment activity (within the meaning of section 21 of the FSMA) relating to Placing Shares in circumstances in which section 21(1) of the FSMA does not require approval of the communication by an authorised person;

25 it has complied and it will comply with all applicable laws with respect to anything done by it or on its behalf in relation to the Placing Shares (including all relevant provisions of the FSMA in respect of anything done in, from or otherwise involving the United Kingdom);

26 if it is a financial intermediary, as that term is used in Article 3(2) of the Prospectus Directive (including any relevant implementing measure in any member state), the Placing Shares acquired by it in the Placing will not be acquired on a non-discretionary basis on behalf of, nor will they be acquired with a view to their offer or resale to, persons in a member state of the EEA which has implemented the Prospectus Directive other than Qualified Investors, or in circumstances in which the express prior written consent of N+1 Singer has been given to the offer or resale;

27 it has neither received nor relied on any confidential price sensitive information about the Company in accepting this invitation to participate in the Placing;

28 neither N+1 Singer nor any of its respective affiliates, agents, directors, officers or employees or any person acting on behalf of any of them has or shall have any liability for any information, representation or statement contained in this Announcement or for any information previously published by or on behalf of the Company or any other written or oral information made available to or publicly available or filed information or any representation, warranty or undertaking relating to the Company, and will not be liable for its decision to participate in the Placing based on any information, representation, warranty or statement contained in this Announcement or elsewhere, provided that nothing in this paragraph shall exclude any liability of any person for fraud;

29 neither N+1 Singer, the Company, nor any of their respective affiliates, agents, directors, officers or employees or any person acting on behalf of N+1 Singer, the Company or their respective affiliates, agents, directors, officers or employees is making any recommendations to it, advising it regarding the suitability of any transactions it may enter into in connection with the Placing nor providing advice in relation to the Placing nor in respect of any representations, warranties, acknowledgements, agreements, undertakings, or indemnities contained in the Placing Agreement nor the exercise or performance of N+1 Singer's rights and obligations thereunder including any rights to waive or vary any conditions or exercise any termination right;

30 acknowledges and accepts that N+1 Singer may, in accordance with applicable legal and regulatory provisions, engage in transactions in relation to the Placing Shares and/or related instruments for their own account for the purpose of hedging their underwriting exposure or otherwise and, except as required by applicable law or regulation, N+1 Singer will not make any public disclosure in relation to such transactions;

31 N+1 Singer and each of its affiliates, each acting as an investor for its or their own account(s), may bid or subscribe for and/or purchase Placing Shares and, in that capacity, may retain, purchase, offer to sell or otherwise deal for its or their own account(s) in the Placing Shares, any other securities of the Company or other related investments in connection with the Placing or otherwise. Accordingly, references in this Announcement to the Placing Shares being offered, subscribed, acquired or otherwise dealt with should be read as including any offer to, or subscription, acquisition or dealing by N+1 Singer and/or any of its respective affiliates, acting as an investor for its or their own account(s). Neither N+1 Singer nor the Company intend to disclose the extent of any such investment or transaction otherwise than in accordance with any legal or regulatory obligation to do so;

32 it has complied with its obligations in connection with money laundering and terrorist financing under the Proceeds of Crime Act 2002, the Terrorism Act 2000, the Terrorism Act 2006 and the Money Laundering Regulations 2007 (together, the "Regulations") and, if making payment on behalf of a third party, that satisfactory evidence has been obtained and recorded by it to verify the identity of the third party as required by the Regulations;

33 it is aware of the obligations regarding insider dealing in the Criminal Justice Act 1993, FSMA, the EU Market Abuse Regulation No. 596 of 2014 and the Proceeds of Crime Act 2002 and confirms that it has and will continue to comply with those obligations;

34 in order to ensure compliance with the Money Laundering Regulations 2007, N+1 Singer (for itself and as agent on behalf of the Company) or the Company's registrars may, in their absolute discretion, require verification of its identity. Pending the provision to N+1 Singer's or the Company's registrars, as applicable, of evidence of identity, definitive certificates in respect of the Placing Shares may be retained at N+1 Singer's absolute discretion or, where appropriate, delivery of the Placing Shares to it in uncertificated form may be delayed at N+1 Singer's or the Company's registrars', as the case may be, absolute discretion. If within a reasonable time after a request for verification of identity N+1 Singer's (for itself and as agent on behalf of the Company) or the Company's registrars have not received evidence satisfactory to them, N+1 Singer and/or the Company may, at its absolute discretion, terminate its commitment in respect of the Placing, in which event the monies payable on acceptance of allotment will, if already paid, be returned without interest to the account of the drawee's bank from which they were originally debited;

35 acknowledges that its commitment to acquire Placing Shares on the terms set out in this Announcement and in the form of confirmation will continue notwithstanding any amendment that may in future be made to the terms and conditions of the Placing and that Placees will have no right to be consulted or require that their consent be obtained with respect to the Company's or N+1 Singer's conduct of the Placing;

36 it has knowledge and experience in financial, business and international investment matters as is required to evaluate the merits and risks of subscribing for the Placing Shares. It further acknowledges that it is experienced in investing in securities of this nature and is aware that it may be required to bear, and is able to bear, the economic risk of, and is able to sustain, a complete loss in connection with the Placing. It has relied upon its own examination and due diligence of the Company and its affiliates taken as a whole, and the terms of the Placing, including the merits and risks involved;

37 it irrevocably appoints any duly authorised officer of N+1 Singer as its agent for the purpose of executing and delivering to the Company and/or its registrars any documents on its behalf necessary to enable it to be registered as the holder of any of the Placing Shares for which it agrees to subscribe or purchase upon the terms of this Announcement;

38 the Company, N+1 Singer and others (including each of their respective affiliates, agents, directors, officers or employees) will rely upon the truth and accuracy of the foregoing representations, warranties, acknowledgements and agreements, which are given to N+1 Singer, on their own behalf and on behalf of the Company and are irrevocable;

39 if it is acquiring the Placing Shares as a fiduciary or agent for one or more investor accounts, it has full power and authority to make, and does make, the foregoing representations, warranties, acknowledgements, agreements and undertakings on behalf of each such accounts;

40 time is of the essence as regards its obligations under this Appendix;

41 any document that is to be sent to it in connection with the Placing will be sent at its risk and may be sent to it at any address provided by it to N+1 Singer;

42 the Placing Shares will be issued subject to the terms and conditions of this Appendix; and

43 these terms and conditions in this Appendix and all documents into which this Appendix is incorporated by reference or otherwise validly forms a part and/or any agreements entered into pursuant to these terms and conditions and all agreements to acquire shares pursuant to the Placing will be governed by and construed in accordance with English law and it submits to the exclusive jurisdiction of the English courts in relation to any claim, dispute or matter arising out of any such contract, except that enforcement proceedings in respect of the obligation to make payment for the Placing Shares (together with any interest chargeable thereon) may be taken by the Company or N+1 Singer in any jurisdiction in which the relevant Placee is incorporated or in which any of its securities have a quotation on a recognised stock exchange.

By participating in the Placing, each Placee (and any person acting on such Placee's behalf) agrees to indemnify and hold the Company, N+1 Singer and each of their respective affiliates, agents, directors, officers and employees harmless from any and all costs, claims, liabilities and expenses (including legal fees and expenses) arising out of or in connection with any breach of the representations, warranties, acknowledgements, agreements and undertakings given by the Placee (and any person acting on such Placee's behalf) in this Appendix or incurred by N+1 Singer, the Company or each of their respective affiliates, agents, directors, officers or employees arising from the performance of the Placee's obligations as set out in this Announcement, and further agrees that the provisions of this Appendix shall survive after the completion of the Placing.

The agreement to allot and issue Placing Shares to Placees (or the persons for whom Placees are contracting as agent) free of stamp duty and stamp duty reserve tax in the United Kingdom relates only to their allotment and issue to Placees, or such persons as they nominate as their agents, direct by the Company. Such agreement assumes that the Placing Shares are not being acquired or to transfer the Placing Shares into a clearance service. If there are any such arrangements, or the settlement related to any other dealings in the Placing Shares, stamp duty or stamp duty reserve tax may be payable. In that event, the Placee agrees that it shall be responsible for such stamp duty or stamp duty reserve tax and neither the Company nor N+1 Singer shall be responsible for such stamp duty or stamp duty reserve tax. If this is the case, each Placee should seek its own advice and they should notify N+1 Singer accordingly. In addition, Placees should note that they will be liable for any capital duty, stamp duty and all other stamp, issue, securities, transfer, registration, documentary or other duties or taxes (including any interest, fines or penalties relating thereto) payable outside the United Kingdom by them or any other person on the acquisition by them of any Placing Shares or the agreement by them to acquire any Placing Shares and each Placee, or the Placee's nominee, in respect of whom (or in respect of the person for whom it is participating in the Placing as an agent or nominee) the allocation, allotment, issue or delivery of Placing Shares has given rise to such non-United Kingdom stamp, registration, documentary, transfer or similar taxes or duties undertakes to pay such taxes and duties, including any interest and penalties (if applicable), forthwith and to indemnify on an after-tax basis and to hold harmless the Company and N+1 Singer in the event that either the Company and/or N+1 Singer has incurred any such liability to such taxes or duties.

The representations, warranties, acknowledgements and undertakings contained in this Appendix are given to N+1 Singer for itself and on behalf of the Company and are irrevocable.

Each Placee and any person acting on behalf of the Placee acknowledges that N+1 Singer does not owe any fiduciary or other duties to any Placee in respect of any representations, warranties, undertakings, acknowledgements, agreements or indemnities in the Placing Agreement.

Each Placee and any person acting on behalf of the Placee acknowledges and agrees that N+1 Singer may (at its absolute discretion) satisfy their obligations to procure Placees by itself agreeing to become a Placee in respect of some or all of the Placing Shares or by nominating any connected or associated person to do so.

When a Placee or any person acting on behalf of the Placee is dealing with N+1 Singer, any money held in an account with N+1 Singer on behalf of the Placee and/or any person acting on behalf of the Placee will not be treated as client money within the meaning of the relevant rules and regulations of the FCA made under FSMA. Each Placee acknowledges that the money will not be subject to the protections conferred by the client money rules: as a consequence this money will not be segregated from N+1 Singer's money (as applicable) in accordance with the client money rules and will be held by it under a banking relationship and not as trustee.

References to time in this Announcement are to London time, unless otherwise stated.

All times and dates in this Announcement may be subject to amendment.

No statement in this Announcement is intended to be a profit forecast, and no statement in this Announcement should be interpreted to mean that earnings per share of the Company for the current or future financial years would necessarily match or exceed the historical published earnings per share of the Company.

The price of shares and any income expected from them may go down as well as up and investors may not get back the full amount invested upon disposal of the shares. Past performance is no guide to future performance, and persons needing advice should consult an independent financial adviser.

The Placing Shares to be issued or sold pursuant to the Placing will not be admitted to trading on any stock exchange other than the London Stock Exchange.

Neither the content of the Company's website nor any website accessible by hyperlinks on the Company's website is incorporated in, or forms part of, this Announcement.

Definitions

"Admission"	the admission of the Placing Shares to trading on AIM following completion of the Placing and such admission becoming effective in accordance with Rule 6 of the AIM Rules;
"CREST"	the relevant system (as defined in the CREST Regulations) in respect of which Euroclear UK & Ireland Limited is the operator (as defined in those regulations);
"Directors"	the directors of the Company;
"Existing Ordinary Shares"	the 37,114,283 Ordinary Shares in issue at the date of this document, all of which are admitted to trading on AIM and being the entire issued ordinary share capital of the Company;
"Form of Proxy"	the form of proxy for use in connection with the General Meeting which accompanies this Circular;
"General Meeting"	the general meeting of the Company anticipated to be held at the offices of Memery Crystal LLP at 44 Southampton Buildings, London WC2A 1AP at 12.00 pm on 19 December 2016, notice of which will be set out at the end of the Circular;
"Group"	the Company, its subsidiaries and its subsidiary undertakings;
"Issue Documents"	this announcement, the announcement to be made later today announcing the results of the Placing and the investor presentation prepared by the Company and used by the Company or on its behalf in meetings with institutional investors in connection with the Placing;
"London Stock Exchange"	London Stock Exchange plc;
"MNOs"	mobile network operators;
"New Ordinary Shares"	the Placing Shares;
"Notice of General Meeting"	the notice convening the General Meeting which will be set out at the end of the Circular;
"Ordinary Shares"	the ordinary shares of 0.2 pence each in the capital of the Company;
"Placing Agreement"	the conditional agreement dated 1 December 2016 made between N+1 Singer and the Company in relation to the Placing;
"Placing Resolutions"	the resolutions to be set out in the Notice of General Meeting to grant the Directors the necessary authority and power to allot the Placing Shares and any Ordinary Shares that may be subscribed for by private investors via PrimaryBid for cash on a non-pre-emptive basis; and
"Specified Event"	means an event occurring or matter arising on or after the date of the Placing Agreement and before the date of Admission which, if it had occurred before the date of the Placing Agreement, would have rendered any of the warranties under the Placing Agreement untrue or incorrect.

This information is provided by RNS

The company news service from the London Stock Exchange

END

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