PROPOSED SHARES AND OPTIONS EXCHANGE OF THE ENTIRE ISSUED AND PAID-UP YUUZOO SHARES AND OUTSTANDING YUUZOO OPTIONS BY WAY OF A SCHEME OF ARRANGEMENT

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1 CONTEL CORPORATION LIMITED (Incorporated in Bermuda) (Company Registration No.: 36658) PROPOSED SHARES AND OPTIONS EXCHANGE OF THE ENTIRE ISSUED AND PAID-UP YUUZOO SHARES AND OUTSTANDING YUUZOO OPTIONS BY WAY OF A SCHEME OF ARRANGEMENT Capitalised terms used herein shall have the definitions ascribed to them in Appendix D of this Announcement, unless otherwise stated or the context otherwise requires. 1. INTRODUCTION The board of directors ( Board ) of Contel Corporation Limited ( Company ) wishes to announce that the Company has, on 15 April 2013, entered into a Shares and Options Exchange Agreement with YuuZoo Corporation, for (i) the acquisition by the Company of the entire issued and paid-up YuuZoo Shares from the YuuZoo Shareholders; and (ii) the surrender of the outstanding YuuZoo Options from the YuuZoo Option Holders, by way of exchange for New Contel Shares and New Contel Options, respectively ( Proposed Shares and Options Exchange ). The Proposed Shares and Options Exchange will be effected by YuuZoo by way of a Shares Scheme and an Options Scheme under Section 179A of the British Virgin Islands Business Companies Act, KEY TERMS OF THE PROPOSED SHARES AND OPTIONS EXCHANGE 2.1 Shares Exchange. Subject to the Shares Scheme being effective, the entire issued and paid-up YuuZoo Shares as at Completion Date shall be transferred to the Company, free and clear of all encumbrances and together with all the rights, title and interest attaching thereto (including the right to receive all dividends and other distributions declared, paid or made thereon thereafter), in exchange for the New Contel Shares. 2.2 Options Exchange. Subject to the Options Scheme being effective, the entire issued and outstanding YuuZoo Options as at Completion Date shall be surrendered by the YuuZoo Option Holders to the Company for cancellation, in exchange for the New Contel Options. 2.3 Consideration. Based on the existing issued and paid-up shares in the capital of the Company as of the date of the Share and Option Exchange Agreement and taking into account the Proposed Share Consolidation, the aggregate consideration payable by the Company for the YuuZoo Shares and YuuZoo Options is approximately S$582,332, ( Consideration ), which will be satisfied by the allotment and issuance of up to 1,164,665,699 (or such other number of) Consideration Shares by the Company on the basis of S$0.50 per Consolidated Share, representing 85% (1) of the Enlarged Share Capital of the Company on Completion. For the avoidance of doubt, in the event the Consideration Shares constitute more or less than 85% of the Enlarged Share Capital on the Completion Date, the Consideration (and consequently the number of Consideration Shares) shall be adjusted accordingly such that the number of Consideration Shares (and consequently the Consideration) shall constitute exactly (or as close as mathematically possible rounding up to the nearest whole number of Consideration Shares) 85% of the Enlarged Share Capital ( Default Shareholding Percentage ).

2 The Consideration was arrived at after arm s length negotiations and on a willing buyer and willing seller basis, taking into account, inter alia, the historical sales penetration and profitability of the YuuZoo Group, business prospects of the YuuZoo Group and the value of the management team of the YuuZoo Group that the Proposed Shares and Options Exchange would bring to the Company. 2.4 Proposed Share Consolidation. The Company will, in connection with the Proposed Shares and Options Exchange, propose the consolidation of every five (5) Shares into one (1) Consolidated Share (or such other ratio as the Company and YuuZoo may agree in writing), to take effect on or before Completion. The Consideration Shares, Additional Consideration Shares and Adjusted Additional Consideration Shares to be issued shall be allotted and issued after the Proposed Share Consolidation has been effected. 2.5 Additional Consideration. Subject to Completion and the YuuZoo Group achieving profit before tax ( PBT ) as set out in its audited consolidated financial statements for the financial year ended 31 December 2014 ( Audited Financial Statements FY2014 ) of not less than S$20,000,000 (the Additional Consideration Threshold ), the YuuZoo Shareholders and/or the YuuZoo Option Holders shall collectively be entitled to additional 25,000,000 Consideration Shares, to be distributed in such manner as may be determined by the directors of YuuZoo. In the event that the PBT achieved by the YuuZoo Group as reported in the Audited Financial Statements FY2014 is less than the Additional Consideration Threshold, the total number of Additional Consideration Shares to be issued by the Company shall be adjusted downwards in accordance with the formula specified in the Shares and Options Exchange Agreement. The Additional Consideration Shares and the Adjusted Additional Consideration Shares (as the case may be) shall be allotted and issued by the Company (i) on the date falling not later than 30 days from the date of the Company s receipt of the Audited Financial Statements FY2014 (where Completion takes place prior to the issuance of the Audited Financial Statements FY2014) or (ii) on the Completion Date (where the issuance of the Audited Financial Statements FY2014 takes place prior to Completion). 2.6 Shareholding Structure on Completion. On Completion, YuuZoo will become a whollyowned subsidiary of the Company, and the YuuZoo Shareholders (and such person(s) as each of them may nominate) will hold 85% (1) of the Enlarged Share Capital. 2.7 Dilution Events. The Default Shareholding Percentage shall be unaffected by: (i) the issuance of Conversion Shares to the Notes Subscriber pursuant to the Equity-Linked Notes Subscription Agreement as further provided in the Shares and Options Exchange Agreement; (ii) the allotment and issuance of 58,233,285 (or such other number of) Consolidated Shares representing 5% of the Consideration Shares to the Consultant as the Consultancy Fee; and (iii) any other transactions as the Company and YuuZoo may agree in writing. 1 Based on 1,370,194,940 Shares in the Enlarged Share Capital of the Company (assuming completion of (i) the Proposed Share Consolidation, (ii) the Dilution events; and (iii) the Proposed Shares and Options Exchange). 2

3 2.8 Conditions Precedent. Completion is conditional upon, inter alia, the Conditions Precedent specified in Appendix A having been satisfied, fulfilled and/or waived in accordance with the terms of the Shares and Options Exchange Agreement. 2.9 Completion. The date falling not more than 5 Business Days after the last of the Conditions Precedent being satisfied, fulfilled and/or waived, or such other date as the Company and YuuZoo may agree in writing Long-Stop Date. The Shares and Options Exchange Agreement will terminate if, inter alia, not all of the Conditions Precedent have been satisfied, fulfilled and/or waived, as relevant, by 31 December 2013 or such other date as the Company and YuuZoo may agree in writing Whitewash Waiver. As the YuuZoo Shareholders will own more than 85%of the enlarged voting share capital of the Company upon Completion, the YuuZoo Shareholders and their concert parties will be required, under Rule 14 of the Code, to make a general offer for the remaining shares of the Company not owned or controlled by the YuuZoo Shareholders and their concert parties at the highest price paid or agreed to be paid by any of them for the shares in the preceding 6 months. It is a Condition Precedent that the SIC grants the YuuZoo Shareholders and their concert parties, and does not revoke any such grant, a waiver of their obligation to make a general offer under Rule 14 of the Code for all the Shares not owned or controlled by them, and that the Shareholders approve a resolution for the waiver of their right to receive such a mandatory offer from the YuuZoo Shareholders and their concert parties at the EGM Moratorium. YuuZoo Shareholders shall comply with, or procure compliance with, all applicable moratorium requirements imposed by the SGX-ST in respect of the Consideration Shares, Additional Consideration Shares or the Adjusted Additional Consideration Shares (as the case may be) Business Disposal. Under the terms of the Shares and Options Exchange Agreement, the Company undertakes that it shall, undertake a restructuring exercise concurrently with the Proposed Shares and Options Exchange and enter into a Business Disposal Agreement to dispose of all of the existing Company Business on an as-is-where-is basis. The completion of the Business Disposal shall be conditional upon completion of the Proposed Shares and Options Exchange, but not vice versa. 3. YUUZOO GROUP The information on the YuuZoo Group in this paragraph 3 was provided by YuuZoo, which has been extracted and reproduced herein. 3.1 YuuZoo Group. Founded in 2008 by Thomas Zilliacus and Ron Creevey, YuuZoo is a profitable, fast-growing company, incorporated in the British Virgin Islands and headquartered in Singapore, with a global reach that builds mobile-optimized but deviceagnostic Targeted Social E-Commerce Networks for consumers, either rolling them out on its own or together with businesses or brands. The Targeted Social Networks provides turnkey solutions to monetise consumers in the mobile social networking space. YuuZoo s turnkey solutions include (i) targeted social e-commerce networks created for age-, interest- or location-specific user groups; (ii) new mobile payment solutions that enable credit card payments to be processed anytime, anywhere, using the mobile phone and a proprietary YuuZoo software; (iii) new mobile advertising solutions; (iv) an integrated mobile payment platform that enables YuuZoo to charge the consumer directly through 3

4 credit card, debit card or e-wallet payments, without having to rely on expensive carrierbilling; (v) targeted shops within each network, offering mobile content, mobile services and physical goods that users pay for through subscriptions or single-purchase payments; and (vi) software and technology that is mobile-optimized but device-agnostic, running on all major mobile operating systems and formatted for thousands of phone models, as well as on TV and online. All solutions run on in-house created and developed advanced technology platforms, with several solutions being filed for patents. YuuZoo offers a completely new approach to social networking. Combining social networking with e-commerce and offering to the consumers hundreds of targeted choices, YuuZoo brings into social networking services and solutions similar to cable-tv channels on TV or magazines in printed media. The targeted approach has resulted in average visit times up to 5 times higher than what earlier has been seen in social networking, and over 90% return users. YuuZoo s network currently has a combined user base of close to 40 million unique registered users in over 160 countries. By adopting a franchise model to grow the business internationally as well as accelerate earnings growth, YuuZoo has established a strong foothold in key growth markets in the developed as well as developing world. In addition to its own targeted social e-commerce networks, YuuZoo also builds networks for clients. The existing client base includes world-class media companies, sport teams and celebrities in Asia, Europe and the USA. For more information on YuuZoo, please visit: Financial Highlights of the YuuZoo Group. A summary of the financial information of the YuuZoo Group is set out in Appendix B. 4. RATIONALE FOR THE PROPOSED SHARES AND OPTIONS EXCHANGE The Board is of the view that the Proposed Shares and Options Exchange provides a highly attractive investment platform for the Company to venture into the global media and telecommunication industry with proven significant growth opportunities. The Board believes that the Proposed Shares and Options Exchange would enhance value for the Company and thus shareholders' value as well as strengthen the balance sheet of the Company. 5. VERY SUBSTANTIAL ACQUISITION OR REVERSE TAKEOVER 5.1 Relative Figures. Based on the last audited consolidated financial statements of the Group for the financial year ended 31 December 2012, the relative figures of the Proposed Shares and Options Exchange computed on the bases set out in Rule 1006(a) to (d) of the Listing Manual are as follows: Rule 1006(a): Net asset value of assets to be disposed of, compared with the Not Applicable Group s net asset value Rule 1006(b): Net profits attributable to the assets acquired, compared with Not meaningful (1) the Group s net profits Rule 1006(c): Aggregate value of the Consideration given, compared with the 1,337% (2) 4

5 Company s market capitalisation based on the total number of issued shares excluding treasury shares Rule 1006(d): Number of equity securities issued by the Company as Consideration for the Proposed Shares and Options Exchange, compared with the number of equity securities previously in issue 222% (3) Notes: (1) The net loss of the Group for the financial period ended 31 December 2012 was US$1,065,000. The unaudited net profits of the YuuZoo Group for the financial year ended 31 December 2012 was US$6,064,000. Under Rule 1002(3) of the Listing Manual, net profits is defined as profit (or loss) before income tax, minority interests and extraordinary items. (2) Based on the Consideration of approximately S$582,332, (equivalent to US$469,623, based on the exchange rate of US$1: S$1.24) and the Company s market capitalisation as at 12 April 2013 (being the full trading day immediately preceding the date of the Shares and Options Exchange Agreement) of US$35,131,000. The market capitalisation of the Company is derived by multiplying the number of Shares in issue by the volume-weighted average traded price of S$ on 12 April (Source: Bloomberg L.P.). (3) Based on 1,189,665,699 Consideration Shares (assuming 25,000,000 Additional Consideration Shares are issued to the YuuZoo Shareholders on Completion) and the 536,479,784 issued ordinary shares in the capital of the Company as at the Latest Practicable Date. 5.2 Reverse Take-over Transaction. The Board notes that the relative figures under Rules 1006(c) and (d) of the Listing Manual exceed 100% and in view that the YuuZoo Shareholders will hold 85% of the Enlarged Share Capital of the Company upon Completion, the Proposed Shares and Options Exchange will also result in a change in control of the Company. Accordingly, the Proposed Shares and Options Exchange constitutes a Very Substantial Acquisition or a Reverse Take-over Transaction as defined under Chapter 10 of the Listing Manual and will be subject to the approval of Shareholders and the SGX-ST pursuant to Rule 1015 of the Listing Manual. 6. PROFORMA FINANCIAL EFFECTS Combined Proforma Financial Effects. The financial effects of the Proposed Shares and Options Exchange are set out in Appendix C. 7. OTHER MATTERS 7.1 Consultancy Fee. In connection with the Proposed Shares and Options Exchange, the Company shall allot and issue to the Consultant 58,233,285 (or such number of) Consolidated Shares at S$0.50 per Consolidated Share on Completion, representing 5% of the total Consideration Shares issued and allotted by the Company. 7.2 Break Fee. Where Completion fails to take place and thereafter YuuZoo (or Yuuzoo Shareholders) accepts a Competing Offer within six (6) months after the termination of the Shares and Options Exchange Agreement, YuuZoo undertakes to pay and/or shall procure the YuuZoo Shareholders to pay a break fee equivalent to 3% of the value of the Competing Offer to the Company in similar form as the consideration of the Competing 5

6 Offer, provided always that non-completion was not due to the default of the Company. 7.3 Equity-Linked Notes. As announced on 8 March 2013, the Company had entered into an Equity-Linked Notes Subscription Agreement with the Notes Subscriber and Advance Capital Partners Limited as the investment manager of the Notes Subscriber, pursuant to which the Company shall issue to the Notes Subscriber Equity-Linked Notes with an aggregate principal amount of up to S$50,000,000. To ensure that the Default Shareholding Percentage remains at 85% as at Completion, the Company agrees that it shall only be entitled to allot and issue an aggregate of up to 40,000,000 Conversion Shares as at Completion, or such other amount as the Company and YuuZoo may agree in writing. 7.4 Compliance Placement. Pursuant to Rule 210(1)(a) of the Listing Manual, at least 12% of the issued share capital of the Company must be held in the hands of at least 500 public shareholders to maintain its listing status on the SGX-ST Main Board. Upon Completion, the Company may not comply with the minimum public float, and in order to meet such requirements, the Company shall, if necessary, undertake the placement of Shares within one (1) month from the Completion Date or such period of time as may be permitted by the SGX-ST in the event that Completion results in these requirements not being met. 7.5 Service Contracts. It is envisaged that the Company may, upon Completion, enter into service contracts with nominees of YuuZoo Shareholders to be appointed to the Board of the Company. As such arrangements have not been firmed up as at the date of this Announcement, the details of such arrangements (if any) will be disclosed in the Circular to be despatched to Shareholders in due course. 8. INTERESTS OF DIRECTORS AND CONTROLLING SHAREHOLDERS None of the directors (other than in his capacity as a director or shareholder of the Company) and controlling shareholders of the Company has any interest, direct or indirect, in the Proposed Share Consolidation and Proposed Shares and Options Exchange. To the best of the knowledge of the Board, there are no controlling shareholders in the Company (other than in their respective capacities as a shareholder of the Company) who has any interest, direct or indirect, in the Proposed Share Consolidation and Proposed Shares and Options Exchange 9. ADVISERS The Company will appoint a financial adviser and an independent financial adviser in respect of the Proposed Shares and Options Exchange in due course. Stamford Law Corporation has been appointed as the legal counsel for the Company in respect of the Proposed Shares and Options Exchange. 10. FURTHER INFORMATION 10.1 Circular. Subject to the approval of the SGX-ST, a circular containing further information on the Proposed Shares and Options Exchange by way of a Shares Scheme and an Options Scheme, the Proposed Share Consolidation and such other transactions as contemplated in the Shares and Options Exchange Agreement, together with a notice of EGM of the Company, will be despatched by the Company to Shareholders in due course. 6

7 10.2 Documents for Inspection. A copy of the Shares and Options Exchange Agreement will be made available for inspection during normal business hours at the office of the Company s company secretary, Tricor Evantthouse Corporate Services (a division of Tricor Singapore Pte. Ltd.) at 80 Robinson Road, #02-00, Singapore for three (3) months from the date of this Announcement: 11. RESPONSIBILITY STATEMENT The Directors (including those who may have delegated detailed supervision of the preparation of this Announcement) collectively and individually accept full responsibility for the accuracy of the information given in this Announcement (other than information relating to the YuuZoo Group) and confirm, after making all reasonable enquiries that to the best of their knowledge and belief, the facts stated and opinions expressed herein (other than relating to the information relating to the YuuZoo Group) are fair and accurate in all material respects as at the date hereof, and that there are no material facts the omission of which would make this Announcement misleading. The directors of YuuZoo (including those who may have delegated detailed supervision of the preparation of this Announcement) collectively and individually accept full responsibility for the accuracy of the information given in this Announcement (only in respect of the information relating to the YuuZoo Group) and confirm, after making all reasonable enquiries that to the best of their knowledge and belief, the facts stated and opinions expressed herein (only in respect of the information relating to the YuuZoo Group) are fair and accurate in all material respects as at the date hereof, and that there are no material facts the omission of which would make this Announcement misleading. Where any information has been extracted or reproduced from published or otherwise publicly available sources, the sole responsibility of the Directors has been to ensure, through reasonable enquiries, that such information is accurately and correctly extracted from such sources or, as the case may be, accurately reflected or reproduced in this Announcement. BY ORDER OF THE BOARD CONTEL CORPORATION LIMITED Thomas Tsang Siu For Non-Executive Chairman 15 April 2013 IMPORTANT NOTE: Shareholders are advised to exercise caution in trading their Shares as the Proposed Shares and Options Exchange is subject to numerous conditions and there is no certainty or assurance as at the date of this Announcement that the Proposed Shares and Options Exchange will be completed. The Company will make the necessary announcements when there are further developments on the Proposed Shares and Options Exchange and Shareholders are advised to read this Announcement and any further announcements by the Company carefully. Shareholders should consult their stock brokers, bank managers, solicitors or other professional advisors if they have any doubt about the actions they should take. This Announcement contains or incorporates by reference forward-looking statements regarding the belief or current expectations of the Company about the Company s business and the transactions described in this Announcement, and the 7

8 belief or current expectations of the YuuZoo Group Companies about the business of the Yuuzoo Group. Generally, words such as may, could, will, expect, intend, estimate, anticipate, believe, plan, seek, continue or similar expressions identify forward-looking statements. These forward-looking statements are not guarantees of future performance. Rather, they are based on current views and assumptions and involve known and unknown risks, uncertainties and other factors, many of which are outside the control of the Company, the YuuZoo Group (as the case may be) and are difficult to predict, that may cause actual results to differ materially from any future results or developments expressed or implied from the forward-looking statements. Any forward-looking statement contained in this Announcement based on past or current trends and/or activities of the Group or the YuuZoo Group should not be taken as a representation that such trends or activities will continue in the future. No statement in this Announcement is intended to be a profit forecast or to imply that the earnings of the Company or the YuuZoo Group for the current year or future years will necessarily match or exceed the historical or published earnings of the Company or the YuuZoo Group, as the case may be. Each forward-looking statement speaks only as of the date of the particular statement. 8

9 APPENDIX A KEY CONDITIONS PRECEDENT FOR THE PROPOSED SHARES AND OPTIONS EXCHANGE 1. Satisfactory Due Diligence on the Yuuzoo Group The satisfactory outcome of due diligence conducted by the Company into the financial, legal, contractual and tax position of the YuuZoo Group. 2. Satisfactory Due Diligence on the Group The satisfactory outcome of due diligence conducted by YuuZoo into the financial, legal, contractual and tax position of the Group. 3. Proposed Share Consolidation Completion of the Proposed Share Consolidation. 4. Board and Shareholders Approvals from YuuZoo The resolution of the board of directors and shareholders of YuuZoo having been obtained for the entry into, implementation and completion of, the transactions contemplated in the Shares and Options Exchange Agreement, including in particular, the Proposed Shares and Options Exchange. 5. Board and Shareholders Approvals from the Company The resolution of the Board and Shareholders having been obtained for the entry into, implementation and completion of, the transactions contemplated in the Shares and Options Exchange Agreement, including in particular: (a) (b) (c) (d) (e) (f) (g) (h) the Proposed Shares and Options Exchange by way of Scheme Shares and Options Scheme; the Proposed Share Consolidation; the Compliance Placement (if required); in respect of the Shareholders, the waiver of their right, by way of a Whitewash Resolution, to receive a general offer from the YuuZoo Shareholders and their concert parties for all the remaining Shares or the Consolidated Shares under Rule 14 of the Code, and such waiver not having been revoked prior to the Completion Date; the appointment of new directors as may be nominated by YuuZoo to be effective following Completion; the new share issue mandate for the Company to issue and allot shares and convertible securities pursuant to the Bermuda Companies Act; the change of name of the Company to such other name as YuuZoo may direct; and any additional items as may be agreed in writing between the Company and YuuZoo. 6. Regulatory Approvals All necessary consents, approvals and waivers of any government bodies, stock exchange and other regulatory authority having jurisdiction over the transactions contemplated in the Shares and Options Exchange Agreement and all other transactions in connection therewith and incidental thereto, having been obtained by YuuZoo or the Company, as relevant, including without limitation: (a) (b) the approval of the SGX-ST being obtained by the Company in respect of the Proposed Shares and Options Exchange, being a reverse takeover under Rule 1015 of the Listing Manual; the in-principle approval of the SGX-ST being obtained by the Company in relation to the 9

10 (c) (d) listing and quotation of the Consideration Shares, the Additional Consideration Shares (if any), the issue of Conversion Shares, the issue of new Consolidated Shares for payment of the Consultancy Fee and the Compliance Placement Shares (if any) on the official list of the SGX-ST; the clearance of MAS being obtained for the offer information statement to be lodged for the purposes of the Compliance Placement (if required); and the waiver by SIC being obtained by the YuuZoo Shareholders in relation to the obligation of the YuuZoo Shareholders and their concert parties to make a general offer for all the Shares under Rule 14 of the Code, such consents, approvals and waivers not having been amended or revoked before the Completion Date, and to the extent that such consents, approvals and waivers are subject to any conditions required to be fulfilled before the Completion Date, all such conditions having been duly so fulfilled. 7. No Prescribed Occurrences and Illegality of Transaction (a) No Prescribed Occurrence having occurred in relation to YuuZoo or the Company other than as required or contemplated by the Shares and Options Agreement between the date of the Shares and Options Agreement and the Completion Date, both dates inclusive. Prescribed Occurrence in relation to YuuZoo shall mean any of the following: (i) (ii) (iii) (iv) (v) (vi) (vii) (viii) (ix) (x) Share Buy-back: Any YuuZoo Group Company entering into a share buy-back agreement or resolving to approve the terms of a share buy-back agreement under any applicable laws of its country of incorporation; Reduction of Share Capital: Any YuuZoo Group Company resolving to reduce its share capital in any way; Allotment of Shares: Any YuuZoo Group Company making an allotment of, or granting an option to subscribe for, any shares or securities convertible into shares or agreeing to make such an allotment or to grant such an option or convertible security; Declaration of Profits: Any YuuZoo Group Company distributing any profits without the Company s agreement in writing; Issuance of Debt Securities: Any YuuZoo Group Company issuing, or agreeing to issue, convertible notes or other debt securities; Material Adverse Change: The occurrence of any matter(s) which cause (i) the net asset value of the YuuZoo Group ( YuuZoo Group NAV ) to decrease by more than S$2,000,000 from the YuuZoo Group NAV as at 31 December 2012 determined using the same accounting standards, policies and principles adopted by the YuuZoo Group for the preparation of the audited consolidated financial statements of the YuuZoo Group for the financial year ended 31 December 2012; Liquidation, Bankruptcy or Insolvency: The liquidation, bankruptcy or insolvency of any YuuZoo Group Company; Termination of Business: The termination of substantially all or part of the assets or business of any YuuZoo Group Company; Appointment of Assignee, Receiver or Liquidator: The appointment of any assignee, receiver or liquidator for substantially all or part of the assets or business of any YuuZoo Group Company; and/or Attachment, Sequestration, Execution or Seizure: The attachment, sequestration, execution or seizure of substantially all or part of the assets of any YuuZoo Group Company. Prescribed Occurrence in relation to the Company shall mean the following: (i) Share Buy-back: Any Group Company entering into a share buy-back agreement or resolving to approve the terms of a share buy-back agreement under the Bermuda Companies Act; 10

11 (ii) (iii) (iv) (v) (vi) (vii) (viii) (ix) (x) Reduction of Share Capital: Save as otherwise necessary in effecting the proposed transactions contemplated in the Shares and Options Exchange Agreement, including but not limited to a capital reduction to lower the par value of the Shares, the Company resolving to reduce its share capital in any way; Declaration of Dividend: Save for the net proceeds, if any, received from the Business Disposal as disclosed in Clause 5.1(g) of the Shares and Options Exchange Agreement], any Group Company declaring or distributing any dividend without YuuZoo's agreement in writing; Issuance of Debt Securities: Any Group Company issuing, or agreeing to issue, convertible notes or other debt securities, save for the Equity-Linked Notes Subscription Agreement as contemplated in the Shares and Options Exchange Agreement; Material Adverse Change: The occurrence of any matter(s) which cause (i) the net asset value of the Group ( Group NAV ) to decrease by more than S$2,000,000 from the Group NAV as at 31 December 2012 determined using the same accounting standards, policies and principles adopted by the Group for the preparation of the audited consolidated financial statements of the Group for the financial year ended 31 December 2012); Liquidation, Bankruptcy or Insolvency: The liquidation, bankruptcy or insolvency of any Group Company; Termination of Business: The termination of substantially all or part of the assets or business of any Group Company, save for the Business Disposal; Appointment of Assignee, Receiver or Liquidator: The appointment of any assignee, receiver or liquidator for substantially all or part of the assets or business of any Group Company; Attachment, Sequestration, Execution or Seizure: The attachment, sequestration, execution or seizure of substantially all or part of the assets of any Group Company; and /or Delisting: The SGX-ST removing the Company from the Main Board of the SGX-ST or suspending the trading of Shares on the SGX-ST for longer than three (3) Business Days (which for the avoidance of doubt, shall not include any trading halts of Shares on the SGX-ST made at the request of the Company). (b) No relevant authority taking, instituting, implementing or threatening to take, institute or implement any action, proceeding, suit, investigation, inquiry or reference, or having made, proposed or enacted any statute, regulation, decision, ruling, statement or order or taken any steps, and there not continuing to be in effect or outstanding any statute, regulation, decision, ruling, statement or order which would or might: (i) (ii) (iii) make the transactions contemplated in the Shares and Options Agreement and all other transactions in connection therewith and incidental thereto, void, illegal and/or unenforceable or otherwise restrict, restrain, prohibit or otherwise frustrate or be adverse to the same; render the Company unable to purchase or swap (as the case may be) all or any of the YuuZoo Shares or the YuuZoo Options (as the case may be) in the manner set out in the Shares and Options Agreement; and/or render the YuuZoo Shareholders and/or their YuuZoo Option Holders unable to dispose or surrender (as the case may be) all or any of its YuuZoo Shares or its YuuZoo Options (as the case may be) in the manner set out in the Shares and Options Agreement. 8. Representations, Undertakings and Warranties Save for any exceptions to be fairly and reasonably disclosed in the letters of disclosure to be provided by the Company and YuuZoo respectively, all representations, undertakings and warranties of YuuZoo and the Company under the Shares and Options Exchange Agreement being complied with, true, complete, accurate and correct in all material respects to the best knowledge and belief of YuuZoo and the directors of the Company as at the date of the Shares and Options Exchange 11

12 Agreement and until the Completion Date. 9. No Material Adverse Change There not having been at any time hereafter any material adverse change, or events, acts or omissions likely to lead to such a change, in the business, assets, prospects, performance, financial position or results of operations of the YuuZoo Group. 10. Minimum Listing Requirements YuuZoo satisfying the Minimum Listing Requirements on or prior to Completion. 11. Court Approval and Registration of Court Order (i) (ii) The order(s) of the Court having been granted in favour of the Shares Scheme and Options Scheme respectively, on such terms and conditions that are reasonably acceptable to Contel (being approvals and orders), before the Long-Stop Date; and The delivery by YuuZoo of an office copy of the order of Court sanctioning the Shares Scheme and Options Scheme to the Registrar of Corporate Affairs of the British Virgin Islands. 12

13 APPENDIX B FINANCIAL HIGHLIGHTS OF THE YUUZOO GROUP A summary of the consolidated financial statements of the YuuZoo Group for the 12-months ended 31 December 2010 ( FY2010 ), 31 December 2011 ( FY2011 ) and unaudited consolidated financial statements of the YuuZoo Group for the 12-months ended 31 December 2012 ( FY2012 ) are set out below ( YuuZoo Group Financial Statements ). The YuuZoo Group Financial Statements have been prepared in accordance with the Singapore Financial Reporting Standards. (A) Consolidated Income Statement FY2010 (US$) Audited FY2011 (US$) Audited FY2012 (US$) Unaudited Revenue 15,098,750 20,257,690 27,744,804 Gross profit 3,061,525 8,161,663 11,155,312 Profit/ (loss) before tax (2,094,902) 2,186,381 6,064,173 Profit/ (loss) after tax (2,121,244) 2,322,356 6,549,453 attributable to shareholders (B) Consolidated Balance Sheet FY2010 (US$) Audited FY2011 (US$) Audited FY2012 (US$) Unaudited Non-current assets 2,488,893 1,794,520 1,647,728 Current assets 3,695,951 10,081,586 16,217,958 Current liabilities 3,991,645 5,618,416 4,631,480 Net current assets (295,694) 4,463,170 11,586,478 Non-current assets/ (liabilities) Net asset value attributable to shareholders Net tangible assets attributable to shareholders 2,193,199 6,257,690 13,234,204

14 1. BASES AND ASSUMPTIONS APPENDIX C COMBINED PROFORMA FINANCIAL EFFECTS 1.1 Bases. The combined proforma financial effects of the Proposed Share Consolidation, the Proposed Shares and Options Exchange (collectively, Relevant Transactions ) on the Group as set out in this Appendix C are based on the audited consolidated financial statements of the Group for the year ended 31 December Assumptions. For the purposes of illustrating the financial effects of the Relevant Transactions, the financial effects have been prepared based on, inter alia, the following basis and assumptions: (a) (b) (c) (d) (e) the financial effects of the Relevant Transactions on the earnings and the earnings per share of the Group for the period ended 31 December 2012 are computed assuming that the Relevant Transactions are completed on 1 January 2012; the financial effects of the Relevant Transactions on the NTA and gearing of the Group as at 31 December 2012 are computed assuming that the Relevant Transactions are completed on 31 December 2012; the analysis not taking into account the financial effects of the Compliance Placement; the analysis not taking into account the transactional costs and expenses which are related to the Relevant Transactions; and the fair market value of each YuuZoo Share being the same as the net asset value per YuuZoo Share, and accordingly, no goodwill arises as a result of the Proposed Shares and Options Exchange. On Completion, the deemed consideration for the Proposed Shares and Options Exchange for accounting purposes will be based on the fair market value of each YuuZoo Share as at Completion Date. As final goodwill will have to be determined at the Completion Date, the actual goodwill could be materially different from the assumption used above. Any goodwill arising thereon from the Proposed Shares and Options Exchange will be accounted for in accordance with the IFRS. 1.3 Proforma Financial Effects. Shareholders should note that the proforma financial effects of the Relevant Transactions are for illustrative purposes only. The illustrative financial effects should not be construed to mean that the Group s actual results, performance or achievements will be as expected, expressed or implied in such financial effects.

15 2. COMBINED PROFORMA FINANCIAL EFFECTS 2.1 Share Capital Number of Shares Share Capital (US$ 000) Company share capital as at 12 April 2013 ( Latest Practicable Date ) 536,479,784 21,459 Resultant share capital following: (a) Completion of the Proposed Share Consolidation (1) (b) Completion of the Proposed Share Consolidation (1) and the Proposed Shares and Options Exchange (2) 107,295,956 1,296,961,656 21, ,163 Notes: (1) Based on the consolidation of every 5 Shares into one (1) Consolidated Share. (2) Based on 1,189,665,699 Consolidated Consideration Shares to be issued at S$0.50 per Consolidated Consideration Share. 2.2 NTA Group 31 Dec 2012 As reported: - NTA (US$ 000) - NTA per Share (US cents) (1) (1,090) (0.20) Adjusted for: (a) Completion of the Proposed Share Consolidation - Adjusted NTA (US$ 000) - Adjusted NTA per Consolidated Share (US cents) (2) (b) Completion of the Proposed Share Consolidation and the Proposed Shares and Options Exchange - Adjusted NTA (US$ 000) - Adjusted NTA per Consolidated Share (US cents) (3) (1,090) (1.02) 12, Notes: (1) Based on 536,479,784Shares in issue as at the Latest Practicable Date. (2) Based on 107,295,956 Consolidated Shares in issue following completion of the Proposed Share Consolidation. 15

16 (3) Based on 1,296,961,656Consolidated Shares in issue following completion of the Proposed Share Consolidation and the Proposed Shares and Options Exchange. 2.3 Net Gearing Group 31 Dec 2012 As reported: - Net debt (US$ 000) (1) - Shareholders funds (US$ 000) (2) - Net gearing Adjusted for: (a) Completion of the Proposed Share Consolidation - Net debt (US$ 000) (1) - Shareholders funds (US$ 000) - Net gearing (2) (b) Completion of the Proposed Share Consolidation and the Proposed Shares and Options Exchange - Net debt (US$ 000) (1) - Shareholders funds (US$ 000) - Net gearing (2) ,920 0 Notes: (1) Net debt is defined as total interest bearing debt less cash and cash equivalents. (2) Net gearing is defined as net debt divided by Shareholders fund. 16

17 APPENDIX D DEFINITIONS Additional Consideration Shares Adjusted Additional Consideration Shares Board Books Closure Date Business Day Business Assets : 25,000,000 Consideration Shares issued to the YuuZoo Shareholders pursuant to the Proposed Shares and Options Exchange, subject to the YuuZoo Group achieving PBT FY2014 of not less than S$20,000,000; : The number of Consideration Shares issued to the YuuZoo Shareholders pursuant to the Proposed Shares and Options Exchange, where the YuuZoo Group achieves PBT FY2014 of less than S$20,000,000, the adjustment mechanism of which is in Clause 2.7(a) of the Shares and Options Exchange Agreement; : The board of directors of the Company; : The date to be announced after the meetings of the Shares Scheme and the Options Scheme, on which the transfer books, the register of members and the register of option holders of YuuZoo will be closed to enable the determination of the entitlements of the YuuZoo Shareholders and the YuuZoo Option Holders to the New Contel Shares and New Contel Options, respectively, under the Proposed Shares and Options Exchange; : A day (other than Saturday, Sunday or a public holiday) on which commercial banks are open for business in Singapore; : All of the assets (other than the Subsidiary Shares) used for the conduct of the Company Business; Business Disposal Agreement : The sale and purchase agreement to be entered into by the Company and such purchaser as may be procured by the Company in relation to the Business Disposal, which shall be conditional upon the completion of the Proposed Shares and Options Exchange; Business Disposal Business Liabilities CDP Circular Code : The disposal of the Company Business by the Company on such terms and conditions as may be set out in the Business Disposal Agreement; : All liabilities, duties and obligations of the Company relating to the Company Business (whether actual or contingent, direct or indirect by virtue of any guarantee previously granted by the Company, and including all forms of taxation, together with any interests and levies and all penalties, charges, costs and additions to tax imposed by any taxation authority relating to the Business, whether levied by reference to income, profits, gains, net wealth, asset values, turnover, added value or other reference), but shall, for the avoidance of doubt, exclude Non-Business Liabilities; : The Central Depository (Pte) Limited; : The circular to be issued by the Company to Shareholders in relation to, inter alia, the Proposed Shares and Options Exchange; : The Singapore Code on Take-overs and Mergers; Companies Act or Act : The Companies Act (Cap. 50); 17

18 Company Business : All of the businesses of the Company existing before the Completion Date, consisting principally the trading of: (i) solar grade silica, silicon metal and other minerals like manganese, as carried on by Silex Group Limited and its subsidiaries; and (ii) the trading of LED and LED related components as carried on by Update Electronics (Hong Kong) Limited, and without prejudice to the generality of the foregoing, shall include Contel Subsidiary Shares, the Business Assets and the Business Liabilities; Competing Offer Completion Date Completion : Any documentation entered into between YuuZoo and a third party offeror for the acquisition of all or a substantial portion of the YuuZoo Shares thereby transferring a controlling interest in the YuuZoo to the third party offeror; : The date falling not more than five (5) Business Days after the last of the Conditions Precedent being satisfied, fulfilled and/or waived, or such other date as the Company and YuuZoo may agree in writing but in any event, before the Long-Stop Date; : The completion of the Proposed Shares and Options Exchange in accordance with the terms of the Shares and Options Exchange Agreement; Compliance Placement Shares : The placement shares as may be allotted and issued by the Company pursuant to the Compliance Placement; Compliance Placement Conditions Precedent Consideration Consideration Shares Consolidated Shares Consultant Consultant Fee : The placement of the Compliance Placement Shares by the Company on such terms as set out in the Shares and Options Exchange Agreement; : The conditions precedent to Completion, the summary of which is set out in Appendix A of this Announcement; : The consideration payable by the Company for the YuuZoo Shares and the YuuZoo Options, being S$582,332, as further described under Section 2.3 of this Announcement; : The New Contel Shares and New Contel Option Shares (assuming the full conversion of the New Contel Options on the Completion Date), collectively comprising up to 1,164,665,699 (or such other number of) new ordinary shares in Contel representing 85% of the share capital of Contel on a fully diluted basis as at Completion Date, to be issued (or granted, as the case may be) by Contel under and in connection with the Proposed Shares and Options Exchange (based on the existing issued and paid up shares in the capital of the Company as of the date of the Shares and Options Exchange Agreement and taking into account of the Proposed Share Consolidation); : The ordinary shares in the capital of the Company following the Proposed Share Consolidation; : Manus Capital Company Limited; : The consultant fee payable by the Company to the Consultant for the 18

19 provision of certain services to the Company necessary for and in connection with the Shares and Options Exchange, to be satisfied by way of allotment and issuance of such number of Consolidated Shares representing 5% of the Consideration Shares to be issued by Contel pursuant to the Shares and Options Exchange Agreement; Conversion Shares Court Default Shareholding Percentage Directors EGM EPS Enlarged Share Capital : New ordinary shares in the capital of the Company upon the conversion of the Equity-Linked Notes; : The Commercial Court of the British Virgin Islands; : Has the meaning ascribed to it in Section 2.3 of this Announcement; : The directors of the Company for the time being; : The extraordinary general meeting of the Company to be held for the purposes of approving the transactions contemplated in the Shares and Options Exchange Agreement and such other transactions in connection therewith and incidental thereto; : Earnings per Share; : Enlarged share capital of the Company (comprising the Group and the YuuZoo Group) on a fully diluted basis upon Completion; Equity-Linked Notes : 0% equity-linked redeemable structured convertible notes due 2016 with an aggregate principal amount of up to S$50,000,000; Equity-Linked Notes Subscription Agreement Group : The equity-linked notes subscription agreement dated 8 March 2013 entered into between the Company and the Notes Subscriber and Advance Capital Partners Limited as the investment manager of the Notes Subscriber, pursuant to which the Company shall issue to the Notes Subscriber the Equity-Linked Notes; : The Company and its subsidiaries, and Group Company shall mean any member of the Group accordingly; Latest Practicable Date : 12 April 2013 LED Listing Manual Long-Stop Date LPS MAS Minimum Distribution Requirements Minimum Listing Requirements New Contel Shares : Light emitting diodes; : The listing manual of the SGX-ST; : 31 December 2013 or such other date as the Company and YuuZoo may agree in writing; : Loss per Share; : The Monetary Authority of Singapore; : The distribution requirements under Rule 210(a) of the Listing Manual; : The minimum listing requirements for a listing on the Mainboard of the SGX-ST, as set out in the rules of the Listing Manual; The Consolidated Shares to be issued by the Company pursuant to the 19

20 Shares Exchange; New Contel Options Non-Business Liabilities Notes Subscriber NTA NAV Options Exchange Options Scheme PBT FY2014 The new options of the Company to be issued by the Company pursuant to the Options Exchange; : All liabilities, duties and obligations of the Company not otherwise relating to the Business, including without limitation, any outstanding fees, costs and expenses incurred by the Company in relation to, in respect of, or in connection with the Proposed Shares and Options Exchange or such other corporate actions carried out by the Company prior to the Completion Date, together with all incurred or adjudged liabilities, duties and obligations of every description of the Company in respect of or consequent to any default or failure in paying or settling such fees, costs and expenses; : Advanced Opportunities Fund; : Net tangible assets; : Net asset value; : The exchange of all issued and outstanding YuuZoo Options with New Contel Options, on such terms as specified in the Shares and Options Exchange Agreement; : The scheme of arrangement to be proposed by YuuZoo to YuuZoo Option Holders under Section 179A of the BVI Companies Act, 2004 pursuant to which the YuuZoo Option Holders shall surrender the entire issued and outstanding YuuZoo Options to the Company for cancellation; : Profit before tax as set out in its audited consolidated financial statements for the financial year ended 31 December 2014; Proposed Share Consolidation : Has the meaning ascribed to it in Section 2.4 of this Announcement; Proposed Shares and Options Exchange SGX-ST Shares and Options Exchange Agreement Shareholders Shares Shares Exchange : The exchange of all issued and paid-up YuuZoo Shares and issued and outstanding YuuZoo Options with Consideration Shares, on such terms as specified in the Shares and Options Exchange Agreement; : The Singapore Exchange Securities Trading Limited; : The shares and options exchange agreement dated 15 April 2013 between YuuZoo and the Company relation to the Proposed Shares and Options Exchange; : The registered holders for the time being of the Shares, except that where the registered holder is CDP, the term Shareholders shall, where the context admits, mean the Depositors who have Shares entered against their names in the Depository Register; : The ordinary shares in the capital of the Company; : The exchange of all issued and paid-up YuuZoo Shares with New Contel Shares, on such terms as specified in the Shares and Options Exchange Agreement; 20