IMImobile : Share exchange and proposed placing of new ordinary shares

THIS ANNOUNCEMENT, INCLUDING THE APPENDIX (TOGETHER, THE "ANNOUNCEMENT") AND THE INFORMATION IN IT, IS RESTRICTED, AND IS NOT FOR PUBLICATION, RELEASE OR DISTRIBUTION, DIRECTLY OR INDIRECTLY, IN WHOLE OR IN PART, IN OR INTO THE UNITED STATES, CANADA, AUSTRALIA, NEW ZEALAND, JAPAN OR THE REPUBLIC OF SOUTH AFRICA OR ANY OTHER JURISDICTION IN WHICH SUCH PUBLICATION OR DISTRIBUTION WOULD BE UNLAWFUL.

IMImobile PLC ("IMImobile" or the "Company") Share Exchange & Proposed Placing of New Ordinary Shares

IMImobile (AIM: IMO) announces that it has been notified by Viswanatha Alluri, Non-Executive Director of the Company and Shyamprasad Bhat, CTO both founders of the Company, (together the "Founding Shareholders") of their intention to exercise their right to exchange their shareholdings in IMI Mobile Private Limited ("PVT") for ordinary shares of 10 pence each in the Company ("Ordinary Shares") in accordance with the terms of the relationship agreement (the "Relationship Agreement") described in paragraph 13.5 of Part IV of the Admission Document published by the Company on 18 June 2014.

To facilitate the payment of tax and other costs arising from this transaction the Founding Shareholders intend to sell 30% of their shareholdings in PVT at the same time as exchanging the remainder of their PVT shares into Ordinary Shares. As such, the Company is announcing a proposed placing of 3,389,881 new Ordinary Shares (the "Placing" or the "Placing Shares") to acquire the Founding Shareholders' PVT shares. As a result of the reorganisation of the share capital of the Company and PVT, the Placing will be non-dilutive to the existing shareholders in the Company.

Under the terms of the Relationship Agreement, the Founding Shareholders have the right to exchange their PVT shares on the basis of one PVT share for three Ordinary Shares (the "Share Exchange") or to require the Company to purchase those shares on the basis of a price which is three times the price of an Ordinary Share (the "Acquisition"). The PVT shares in aggregate represent rights over 11,299,599 Ordinary Shares representing approximately 18.6 per cent. of IMImobile's enlarged issued capital following completion of the Share Exchange and Placing. The Company has been notified by the Founding Shareholders that they are exercising their rights under the Share Exchange provisions in respect of 2,636,573 PVT shares (representing 7,909,719 Ordinary Shares representing approximately 13.0 per cent. of IMImobile's existing issued share capital on a fully diluted basis) and under the Acquisition provisions in respect of their remaining 1,129,960 PVT shares. As a result of the Share Exchange and Acquisition, the Company will own 99.99% of the issued share capital of PVT.

Proposed Placing

In order to facilitate the Acquisition, IMImobile announces that it intends to place 3,389,881 new Ordinary Shares at a price of 159 pence per Placing Share (the "Placing Price"), representing approximately 5.6 per cent. of IMImobile's enlarged issued capital following completion of the Share Exchange and Placing, raising gross proceeds of £5.4 million.

The proceeds of the Placing will be used to acquire 1,129,960 shares in PVT for an aggregate cash consideration of approximately £5.4 million representing a price of 477p per PVT share, that price being three times the price of an Ordinary Share.

Following the proposed Share Exchange and Placing the Founding Shareholders shareholdings will be as follows:

• Viswanatha Alluri will hold 6,739,707 Ordinary Shares, representing approximately 11.1 per cent. of IMImobile's share capital; and

  • Shyamprasad Bhat will hold, 1,170,012 Ordinary Shares, representing approximately 1.9% per cent. of IMImobile's share capital.

In aggregate, the Founding Shareholders will hold 7,909,719 Ordinary Shares representing approximately 13.0 per cent. of IMImobile's issued share capital following the Share Exchange and Placing. All costs of the proposed Share Exchange and Placing will be borne by the Founding Shareholders.

A further announcement will be made once the Placing has been completed. Investec and Whitman Howard are acting as joint bookrunners and brokers (together the "Joint Bookrunners" and "Joint Brokers") in respect of the Placing.

The Appendix to this announcement (which forms part of the announcement) sets out the terms and conditions of the Placing and expressions used in this announcement shall have the meanings set out in the Definitions section of the Appendix.

Total Voting Rights

Following the Share Exchange, Placing and Admission, the Company's enlarged issued share capital will comprise 60,621,781 Ordinary Shares of 10 pence each. The Company holds zero shares in treasury.

Therefore, when calculating voting rights, shareholders should use the figure of 60,621,781 as the denominator for the calculations by which they will determine if they are required to notify their interest in, or a change in their interest in, the share capital of the Company under the FCA's Disclosure and Transparency Rules.

The two B Shares (which are described in paragraph 5.2.16 Part IV of the Admission Document published by the Company on 18 June 2014) will cease to have voting rights following the completion of the Share Exchange. The Company will redeem the B Shares at par from the proceeds of the placing in accordance with the Company's articles of association at which time the Relationship Agreement will be terminated. In addition the Company will propose a resolution at its next general meeting to remove references to the B Shares from its articles of association.

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.

For further information please contact:

IMImobile PLC Jay Patel, Chief Executive Officer Mike Jefferies, Chief Financial Officer	c/o Redleaf Communications Tel: [phone]
Redleaf Communications - PR adviser Charlie Geller Sam Modlin	Tel: [phone] [e-mail]
Investec Bank - Nominated Adviser and Broker Dominic Emery Henry Reast	Tel: [phone]

Whitman Howard - Joint Broker Ranald McGregor-Smith Francis North

Tel: [phone]

About IMImobile PLC

IMImobile is a cloud communications software and solutions provider that enables companies to use mobile and digital technologies to communicate and engage with their customers.

Organisations that trust us to deliver smarter digital customer engagement solutions include Vodafone, O2, Telefonica, Aircel, Airtel, EE, BSNL, AT&T, MTN, France Telecom, Centrica, Universal Music, Tata, the AA, the BBC and major financial institutions.

IMImobile is headquartered in London with offices in Hyderabad, Atlanta, Dubai and Johannesburg and has over 800 employees worldwide. IMImobile is quoted on the London Stock Exchange's AIM market with the TIDM code IMO.

APPENDIX TERMS AND CONDITIONS OF THE PLACING

IMPORTANT INFORMATION FOR PLACEES ONLY REGARDING THE PLACING

THIS ANNOUNCEMENT, INCLUDING THIS APPENDIX (TOGETHER, THE "ANNOUNCEMENT") AND THE INFORMATION IN IT, IS RESTRICTED, AND IS NOT FOR PUBLICATION, RELEASE OR DISTRIBUTION, DIRECTLY OR INDIRECTLY, IN WHOLE OR IN PART, IN OR INTO THE UNITED STATES, CANADA, AUSTRALIA, NEW ZEALAND, JAPAN OR THE REPUBLIC OF SOUTH AFRICA OR ANY OTHER JURISDICTION IN WHICH SUCH PUBLICATION OR DISTRIBUTION WOULD BE UNLAWFUL.

IMPORTANT INFORMATION ON THE PLACING FOR INVITED PLACEES ONLY.

MEMBERS OF THE PUBLIC ARE NOT ELIGIBLE TO TAKE PART IN THE PLACING. THIS ANNOUNCEMENT (INCLUDING THE APPENDIX) AND THE TERMS AND CONDITIONS SET OUT HEREIN ARE FOR INFORMATION PURPOSES ONLY AND ARE DIRECTED ONLY AT PERSONS:

(A) WHO, IF IN THE UNITED KINGDOM, HAVE BEEN SELECTED BY THE RELEVANT BROKER AND WHO HAVE PROFESSIONAL EXPERIENCE IN MATTERS RELATING TO INVESTMENTS AND ARE "INVESTMENT PROFESSIONALS" WITHIN THE MEANING OF ARTICLE 19 (5) OF THE FINANCIAL SERVICES AND MARKETS ACT 2000 (FINANCIAL PROMOTION) ORDER 2005 (AS AMENDED) (THE "ORDER") OR ARE PERSONS FALLING WITHIN ARTICLE 49(2)(A) TO (D) ("HIGH NET WORTH COMPANIES, UNINCORPORATED ASSOCIATIONS, ETC.") OF THE ORDER; (B) WHO, IF IN A MEMBER STATE OF THE EUROPEAN ECONOMIC AREA, ARE "QUALIFIED INVESTORS" (AS DEFINED IN 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 EU DIRECTIVE 2003/71/EC OF THE EUROPEAN PARLIAMENT AND THE COUNCIL OF 4 NOVEMBER 2003 (TOGETHER WITH ANY IMPLEMENTING DIRECTIVE MEASURE IN SUCH MEMBER STATES, THE "PROSPECTUS DIRECTIVE")); (C) WHO, IF IN THE UNITED STATES, ARE "QUALIFIED INSTITUTIONAL BUYERS" (AS DEFINED IN RULE 144A UNDER THE US SECURITIES ACT); OR (D) ARE OTHERWISE PERSONS TO WHOM IT MAY LAWFULLY BE COMMUNICATED (ALL SUCH PERSONS TOGETHER BEING REFERRED TO AS "RELEVANT PERSONS"). THIS ANNOUNCEMENT AND THE TERMS AND CONDITIONS SET OUT HEREIN MUST NOT BE ACTED ON OR RELIED ON BY PERSONS WHO ARE NOT RELEVANT PERSONS. ANY INVESTMENT OR INVESTMENT ACTIVITY TO WHICH THIS ANNOUNCEMENT AND THE TERMS AND CONDITIONS SET OUT HEREIN RELATES IS AVAILABLE ONLY TO RELEVANT PERSONS AND WILL BE ENGAGED IN ONLY WITH RELEVANT PERSONS.

THIS ANNOUNCEMENT, INCLUDING THIS APPENDIX, IS FOR INFORMATION PURPOSES ONLY AND DOES NOT ITSELF CONSTITUTE AN OFFER FOR SALE OR SUBSCRIPTION OF ANY SECURITIES IN THE COMPANY. THIS ANNOUNCEMENT HAS BEEN ISSUED BY AND IS THE SOLE RESPONSIBILITY OF THE COMPANY.

THIS ANNOUNCEMENT, INCLUDING THIS APPENDIX, IS NOT AN OFFER FOR SALE OR SUBSCRIPTION IN ANY JURISDICTION IN WHICH SUCH OFFER, SOLICITATION OR SALE WOULD BE UNLAWFUL UNDER THE SECURITIES LAWS OF ANY SUCH JURISDICTION. THIS ANNOUNCEMENT, INCLUDING THIS APPENDIX, IS NOT AN OFFER OF OR SOLICITATION TO PURCHASE OR SUBSCRIBE FOR SECURITIES IN THE UNITED STATES. THE SECURITIES REFERRED TO HEREIN HAVE NOT BEEN AND WILL NOT BE REGISTERED UNDER THE US SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), AND MAY NOT BE OFFERED OR SOLD IN THE UNITED STATES, EXCEPT PURSUANT TO AN EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT. NEITHER THE UNITED STATES SECURITIES AND EXCHANGE COMMISSION NOR ANY SECURITIES REGULATORY AUTHORITY OF ANY STATE OR OTHER JURISDICTION OF THE UNITED STATES HAS APPROVED OR DISAPPROVED OF AN INVESTMENT IN THE SECURITIES OR PASSED UPON OR ENDORSED THE MERITS OF THE PLACING OR THE ACCURACY OR ADEQUACY OF THE CONTENTS OF THIS ANNOUNCEMENT. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENCE IN THE UNITED STATES. NO PUBLIC OFFERING OF SECURITIES IS BEING MADE IN THE UNITED STATES. 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 OWN ADVISERS AS TO LEGAL, TAX, BUSINESS AND RELATED ASPECTS OF AN INVESTMENT IN PLACING SHARES. THE PRICE OF SHARES IN THE COMPANY AND THE INCOME FROM THEM (IF ANY) MAY GO DOWN AS WELL AS UP AND INVESTORS MAY NOT GET BACK THE FULL AMOUNT INVESTED ON DISPOSAL OF SHARES.

For the purposes of this Appendix, "Relevant Broker" means either of Investec or Whitman Howard.

Persons who are invited to and who choose to participate in the Placing, by making (or on whose behalf there is made) an oral or written offer to subscribe for Placing Shares (each such person whose participation is accepted by the Relevant Broker in accordance with this Appendix being hereinafter referred to as a "Placee" and together, as the "Placees"), will be deemed to have read and understood this Announcement, including this Appendix, in its entirety and to be making such offer on the terms and conditions, and to be providing the representations, warranties, acknowledgements, and undertakings contained in this Appendix. In particular, each such Placee represents, warrants and acknowledges that:

1. it is a Relevant Person (as defined above) 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 any Placing Shares acquired by it as a financial intermediary, as that term is used in Article 3(2) of the Prospectus Directive, (i) the Placing Shares acquired by it have not been acquired on behalf of, nor have they been acquired with a view to their offer or resale to, persons in any Member State of the European Economic Area ("EEA") which has implemented the Prospectus Directive other than Qualified Investors or in circumstances in which the prior consent of the Brokers has been given to the offer or resale; or (ii) 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; and/or

3. (a) it is not in the United States, (b) it is a dealer or other professional fiduciary in the United States acting on a discretionary basis for a non-US person (other than an estate or trust) in reliance on Regulation S under the Securities Act; or (c) it is otherwise acquiring the Placing