Still thinking aloud:
Scenario 1
Stream lost $400k on turnover of $1.6, so cost of that business is about $2m. Add in Tad's current loss (excluding any MCI/EDS/M$ effect) of about $6.5m then, if there is no improvement in current performance, and no cost savings from the merger:

Year 1
TAD = -$6.5m
Stream = -$400k

Turnover from Japan = $9m. COS = say 40% (including 5% commission) = $3.6m, so GP = $5.4m

Year Nett = 5.4m - 6.5m - 0.4m = -1.5m

Year 2
TAD = -$6.5m
Stream = -$400k

Turnover from Japan = $10m. COS = say 40% (including 5% commission) = $4.0m, so GP = $6.0m
Subtract double performance of $2m = $4m

Year Nett = 4 - 6.5 - 0.4 = -$2.9m

Yikes - that's not too good. Total loss over 2 years = $4.5m

Scenario 2 TAD finally manage to sell something, and save some of the cost of Stream. Japan sales increase to 10 then 12m

Year 1
TAD = -$4m
Stream = 0

turnover from Japan = $10m - 40% COS = $6m GP. Subtract $2m for Stream payment = $4m

Year Nett = $4m - $4m = 0 Break-even

Year 2
TAD = -$4m
Stream =0

turnover from Japen = $12m - 40% COS = 4.8 = 7.2m. Subtract $4m for Stream = $3.2m

Year Nett = $3.2m - $4m = -.8m

Overall - not that great, but much improved on now, and with "clean" revenue stream in year 3.

All pretty bloody imponderable though - very dependent on what the COS is, how much other revenue TAD make, Stream overheads, rate of increase in Japan, etc etc

zzaxx - there is an IC article today stating that gross margins are 100% and operating margins are 85%

if TAD use all income from the provider to pay the owner his 2 x revenue in years one and two then TAD are only left with the need to fund from cash/shares 1 x revenue - also bear in mind we get the $9m and have 4m in the bank

after that TAD get all the revenue and in any event get all revenues from other deals through stream

agree it will take time to see how successful this is but imho the more successful it is the better for TAD as the share price will increase in anticipation of the free cash flow post year 3 and reduce any amount of shares that have to be issued in years 1 and 2

someone also made the point that if a japanese tleco is paying this much then what are TAD likely to get out of MCI?

hate to be picky - but TAD will not lose $6.5m per year - you are forgetting that Cartesia will make substantial profits in H2

-- dd,

thanks for the extra info re: margins etc.

New Brokers note/Morning update has been released.
Anyone seen it??

M

Evolution Beeson Gregory 100 Wood Street, London, EC2V 7AN www.evbg.com 7 July 2004
Second Helping

In this issue: TAD
(click to view) Reason Action Price/Target

M&A Buy 15p/20p TADPOLE TECHNOLOGY (TAD)

Tadpole has acquired a Californian applications-streaming business similar
to its Endeavors division, but with most of its business in the games industry
to complement Endeavors position in business software
Regular Features (Click to view)
Key to Company Data


Second Helping7 July 2004
Evolution Beeson Gregory 100 Wood Street, London, EC2V 7AN

Tadpole Technology (TAD) Buy (unchanged)

Mkt cap: 47m Net cash: 0m M&A Price/Target: 15p/20p

Tadpole acquires games streaming business in the US
Tadpole has acquired a Californian applications-streaming business
similar to its Endeavors division, but with most of its business in the
games industry to complement Endeavors position in business software.
Tadpole will buy the entire share capital of Stream Theory (ST) for an initial
consideration of $25 million in Tadpole shares at the strike price of 15.75p. At
current forex rates that would be 85.7m new shares. Further Tadpole shares
will be payable based on 2x any new revenues generated over the next two
years from a deal with a broadband ISP. The CEO of ST will join the Tadpole
Board.

ST has just signed an initial $9m exclusive distribution agreement with the
large Japanese broadband Internet provider who will use STs server
technology to distribute games and other software applications over its
broadband network.

In our view the acquisition makes sound business sense. Both companies
develop and sell similar software which streams applications on demand over
a network (usually the Internet) to individual PCs.

Tadpoles Endeavors
subsidiary currently addresses the market for streaming enterprise
applications in the US and Europe through managed service providers and
telcos; with ST, it gains access and revenues from streaming apps in the
Japanese games market, and a platform to penetrate other games markets
world-wide.
These are two of the leading streaming technology companies in the world
and the combined entity becomes an industry leader in the development of
streaming solutions for the enterprise and consumer games markets. The
combined client base will stretch from AutoDesk and Microsoft in the
enterprise market to some of the biggest names in the games market. Each is
likely to retain its own branding to address its own market segment. STs
technology not only complements Tadpoles but it strengthens the patent
protection. It also has a streaming apps player which can deliver messages
and promotions to the end user prior to the applications streaming itself.
In the year to March 2004, ST had revenues of $1.6m and a net loss of $0.4m,
but there is likely to be a step change in the level of revenues this year
following the agreement with the ISP


EVBG is broker to Tadpole Technology


Buying Stream Theory for initial
$25m in stock
Recently signed major ISP deal in
Japan
Similar products to different
markets
Combination creates an industry
leader
ST makes a small loss but that will
change shortly
TADPOLE TECHNOLOGY
FROM 6/4/04 TO 6/7/04 DAILY
APR MAY JUN JUL
14.50
15.00
15.50
16.00
16.50
17.00
17.50
18.00
18.50
19.00
19.50
HIGH 19. 00 2 3/ 4 /04 LOW 1 5.00 20 / 5/0 4 L AST 1 6.0 0 Source: DATASTREAM
Second Helping7 July 2004
Evolution Beeson Gregory 100 Wood Street, London, EC2V 7AN 020 7071 4300 3
Key to Company Data
Target Price Anticipated share price level on a 3 month view
Recommendation Based on Absolute performance
Buy: <10%
Add: up to +10%
Reduce: down to -10%
Sell: > 10%
Net cash Last reported (unless otherwise stated); a net debt position is listed as - cash
Pre-tax and EPS Stated pre goodwill amortisation and exceptionals
Note: This note summarises comments made at our morning meeting TODAY. It is a rapid response to new information and we reserve the right to modify our views accordingly.
This document is issued by Evolution Beeson Gregory Ltd (Evolution Beeson Gregory (incorporated in England, No. 2316630) which is authorised and regulated in the United Kingdom
by The Financial Services Authority for designated investment business and is a member of the London Stock Exchange. This document is for distribution in or from the United Kingdom
only to persons who are authorised persons or exempted persons within the meaning of the Financial Services and Markets Act 2000 of the United Kingdom.This document is for
information purposes only and should not be regarded as an offer or solicitation to buy the securities or other instruments mentioned in it. Expressions of opinion are those of the research
department of Evolution Beeson Gregory only and are subject to change without notice. No representation or warranty, either express or implied, is made nor responsibility of any kind is
accepted by any Evolution Group company, its directors or employees either as to the accuracy or completeness of any information stated in this document. Evolution Beeson Gregory or
persons connected with it may provide or may have provided corporate services to the issuers of securities mentioned in this material. Accordingly information may be known to Evolution
Beeson Gregory or persons connected with it which is not reflected in this material. Evolution Beeson Gregory may make a market or deal as principal or agent in the securities mentioned
in this document. Investors should be aware of the following risks associated with investment in securities: 1. The price, value or income of or from securities may fall against your interests
and you may get back less than you invested. 2. No personal recommendation is being made to you; the securities referred to may not be suitable for you and, if you have any doubts, you
should seek advice from your investment adviser. 3. Changes in rates of exchange may have an adverse effect on the value, price or income of the securities. 4. The past is not necessarily a
guide to future performance.

Evolution Beeson Gregory 100 Wood Street, London, EC2V 7AN www.evbg.com 7 July 2004
Second Helping

In this issue: TAD
(click to view) Reason Action Price/Target

M&A Buy 15p/20p TADPOLE TECHNOLOGY (TAD)

Tadpole has acquired a Californian applications-streaming business similar
to its Endeavors division, but with most of its business in the games industry
to complement Endeavors position in business software
Regular Features (Click to view)
Key to Company Data


Second Helping7 July 2004
Evolution Beeson Gregory 100 Wood Street, London, EC2V 7AN

Tadpole Technology (TAD) Buy (unchanged)

Mkt cap: 47m Net cash: 0m M&A Price/Target: 15p/20p

Tadpole acquires games streaming business in the US
Tadpole has acquired a Californian applications-streaming business
similar to its Endeavors division, but with most of its business in the
games industry to complement Endeavors position in business software.
Tadpole will buy the entire share capital of Stream Theory (ST) for an initial
consideration of $25 million in Tadpole shares at the strike price of 15.75p. At
current forex rates that would be 85.7m new shares. Further Tadpole shares
will be payable based on 2x any new revenues generated over the next two
years from a deal with a broadband ISP. The CEO of ST will join the Tadpole
Board.

ST has just signed an initial $9m exclusive distribution agreement with the
large Japanese broadband Internet provider who will use STs server
technology to distribute games and other software applications over its
broadband network.

In our view the acquisition makes sound business sense. Both companies
develop and sell similar software which streams applications on demand over
a network (usually the Internet) to individual PCs.

Tadpoles Endeavors
subsidiary currently addresses the market for streaming enterprise
applications in the US and Europe through managed service providers and
telcos; with ST, it gains access and revenues from streaming apps in the
Japanese games market, and a platform to penetrate other games markets
world-wide.
These are two of the leading streaming technology companies in the world
and the combined entity becomes an industry leader in the development of
streaming solutions for the enterprise and consumer games markets. The
combined client base will stretch from AutoDesk and Microsoft in the
enterprise market to some of the biggest names in the games market. Each is
likely to retain its own branding to address its own market segment. STs
technology not only complements Tadpoles but it strengthens the patent
protection. It also has a streaming apps player which can deliver messages
and promotions to the end user prior to the applications streaming itself.
In the year to March 2004, ST had revenues of $1.6m and a net loss of $0.4m,
but there is likely to be a step change in the level of revenues this year
following the agreement with the ISP


EVBG is broker to Tadpole Technology


Buying Stream Theory for initial
$25m in stock
Recently signed major ISP deal in
Japan
Similar products to different
markets
Combination creates an industry
leader
ST makes a small loss but that will
change shortly
TADPOLE TECHNOLOGY
FROM 6/4/04 TO 6/7/04 DAILY
APR MAY JUN JUL
14.50
15.00
15.50
16.00
16.50
17.00
17.50
18.00
18.50
19.00
19.50
HIGH 19. 00 2 3/ 4 /04 LOW 1 5.00 20 / 5/0 4 L AST 1 6.0 0 Source: DATASTREAM
Second Helping7 July 2004
Evolution Beeson Gregory 100 Wood Street, London, EC2V 7AN 020 7071 4300 3
Key to Company Data
Target Price Anticipated share price level on a 3 month view
Recommendation Based on Absolute performance
Buy: 10%
Net cash Last reported (unless otherwise stated); a net debt position is listed as - cash
Pre-tax and EPS Stated pre goodwill amortisation and exceptionals
Note: This note summarises comments made at our morning meeting TODAY. It is a rapid response to new information and we reserve the right to modify our views accordingly.
This document is issued by Evolution Beeson Gregory Ltd (Evolution Beeson Gregory (incorporated in England, No. 2316630) which is authorised and regulated in the United Kingdom
by The Financial Services Authority for designated investment business and is a member of the London Stock Exchange. This document is for distribution in or from the United Kingdom
only to persons who are authorised persons or exempted persons within the meaning of the Financial Services and Markets Act 2000 of the United Kingdom.This document is for
information purposes only and should not be regarded as an offer or solicitation to buy the securities or other instruments mentioned in it. Expressions of opinion are those of the research
department of Evolution Beeson Gregory only and are subject to change without notice. No representation or warranty, either express or implied, is made nor responsibility of any kind is
accepted by any Evolution Group company, its directors or employees either as to the accuracy or completeness of any information stated in this document. Evolution Beeson Gregory or
persons connected with it may provide or may have provided corporate services to the issuers of securities mentioned in this material. Accordingly information may be known to Evolution
Beeson Gregory or persons connected with it which is not reflected in this material. Evolution Beeson Gregory may make a market or deal as principal or agent in the securities mentioned
in this document. Investors should be aware of the following risks associated with investment in securities: 1. The price, value or income of or from securities may fall against your interests
and you may get back less than you invested. 2. No personal recommendation is being made to you; the securities referred to may not be suitable for you and, if you have any doubts, you
should seek advice from your investment adviser. 3. Changes in rates of exchange may have an adverse effect on the value, price or income of the securities. 4. The past is not necessarily a
guide to future performance.

moneylender snap impecable timing dont you think

Spot on Midas

Its quite upbeat for EVO, I think they are on our side now.

M

Investors Chronicle exclusive on the deal.

http://www.investorschronicle.co.uk/content/free/2003/News/article_gen_01448.html

M

Very upbeat the deal was struck at 15.75 this is the reason we have been languishing at these levels for some time this deal has taken some time to put together MM manipulation on the price mid price was spot on .
should be some good stuff in the papers today more contracts coming straight up from here.

Please be advised that the following statement is being streamed today to
business and technology editors on behalf of Tadpole's Endeavors Technology
subsidiary.

Sincerely,

Hugh Paterson
Patcom Media

###

Parsons Adopts On-Demand Application Delivery Solution from Endeavors
Technology

Planning, engineering and construction company to use Endeavors' solution
for on-demand application delivery, license compliance, piracy prevention
and user management

###

Endeavors Technology today announces that Parsons has selected AppExpress as
its on-demand solution for making applications available to desktops across
the enterprise. With AppExpress, Parsons will have the capability for fast,
economical, and strongly controlled application delivery. It will also be
able to track use of the software online and offline.

Parsons selected AppExpress to improve the manageability, cost and
provisioning of software to its Windows.-environment desktops. For a number
of years, Parsons has employed its in-house-developed Execution and Delivery
Environment (EDE) system to establish the CAD working environment and
deliver applications in desired project-specific configuration to the user
community.

The goal of the AppExpress integration is to have the user interaction with
EDE remain as it is, while dramatically improving the user experience with
the rapid application streaming capabilities of AppExpress. A further
objective is to facilitate delivery of the wide range of general software
applications that are used outside the EDE system. The integrated systems
exhibit superior usage tracking capability. This will prevent users from
appropriating or bypassing the tracking mechanism as well as improve the
overall reliability of the system.

AppExpress is a secure on-demand application delivery mechanism for
distributing and analyzing applications inside large enterprises and across
remote desktops. AppExpress's architecture offers dramatic improvements in
scalability and reduced operational costs compared to traditional delivery
technologies.

Analysts state that on-demand application delivery makes it economically
feasible to deliver applications to people according to need. This is
particularly important for mobile and power users who are a growing
population within enterprises. AppExpress offers many access and license
management capabilities for the occasionally connected user.

"It is essential for us that management has central control of the software
distribution and can decide on the rules of licensing depending on user
roles and profiles," according to Parsons. "AppExpress provides us much
more granular control of license management, better monitoring of
application usage by the second, as well as providing firm prevention of
unauthorized software use."

AppExpress is certified for Microsoft Windows Server 2003 Standard,
Enterprise, and Datacenter Editions. Endeavors Technology is a Gold
Certified Partner of Microsoft. More at www.endeavors.com.

About Parsons
Parsons, a leader in many diversified markets, such as transportation,
facilities, industrial processes, communications, infrastructure, water,
advanced technology, environmental and planning, provides technical and
management solutions to private industrial customers worldwide as well as
federal,
regional and local government agencies. For more about Parsons, visit
www.parsons.com.

About Endeavors Technology
Endeavors Technology is a wholly owned subsidiary of Tadpole Technology plc
(www.tadpoletechnology.com), a listed company on the London Stock Exchange
(EPIC-TAD). Its flagship product, AppExpress, enables the secure and rapid
deployment of Windows-based software to desktops. The trialware version
enables ISVs to run full try-before-buy product campaigns, and provides
strong license management controls to eliminate piracy.

ends

All trademarks mentioned in this release are the property of their
respective owners.

Please be advised that the following statement is being streamed today to
business and technology editors on behalf of Tadpole's Endeavors Technology
subsidiary.

Sincerely,

Hugh Paterson
Patcom Media

###

Parsons Adopts On-Demand Application Delivery Solution from Endeavors
Technology

Planning, engineering and construction company to use Endeavors' solution
for on-demand application delivery, license compliance, piracy prevention
and user management

###

Endeavors Technology today announces that Parsons has selected AppExpress as
its on-demand solution for making applications available to desktops across
the enterprise. With AppExpress, Parsons will have the capability for fast,
economical, and strongly controlled application delivery. It will also be
able to track use of the software online and offline.

Parsons selected AppExpress to improve the manageability, cost and
provisioning of software to its Windows.-environment desktops. For a number
of years, Parsons has employed its in-house-developed Execution and Delivery
Environment (EDE) system to establish the CAD working environment and
deliver applications in desired project-specific configuration to the user
community.

The goal of the AppExpress integration is to have the user interaction with
EDE remain as it is, while dramatically improving the user experience with
the rapid application streaming capabilities of AppExpress. A further
objective is to facilitate delivery of the wide range of general software
applications that are used outside the EDE system. The integrated systems
exhibit superior usage tracking capability. This will prevent users from
appropriating or bypassing the tracking mechanism as well as improve the
overall reliability of the system.

AppExpress is a secure on-demand application delivery mechanism for
distributing and analyzing applications inside large enterprises and across
remote desktops. AppExpress's architecture offers dramatic improvements in
scalability and reduced operational costs compared to traditional delivery
technologies.

Analysts state that on-demand application delivery makes it economically
feasible to deliver applications to people according to need. This is
particularly important for mobile and power users who are a growing
population within enterprises. AppExpress offers many access and license
management capabilities for the occasionally connected user.

"It is essential for us that management has central control of the software
distribution and can decide on the rules of licensing depending on user
roles and profiles," according to Parsons. "AppExpress provides us much
more granular control of license management, better monitoring of
application usage by the second, as well as providing firm prevention of
unauthorized software use."

AppExpress is certified for Microsoft Windows Server 2003 Standard,
Enterprise, and Datacenter Editions. Endeavors Technology is a Gold
Certified Partner of Microsoft. More at www.endeavors.com.

About Parsons
Parsons, a leader in many diversified markets, such as transportation,
facilities, industrial processes, communications, infrastructure, water,
advanced technology, environmental and planning, provides technical and
management solutions to private industrial customers worldwide as well as
federal,
regional and local government agencies. For more about Parsons, visit
www.parsons.com.

About Endeavors Technology
Endeavors Technology is a wholly owned subsidiary of Tadpole Technology plc
(www.tadpoletechnology.com), a listed company on the London Stock Exchange
(EPIC-TAD). Its flagship product, AppExpress, enables the secure and rapid
deployment of Windows-based software to desktops. The trialware version
enables ISVs to run full try-before-buy product campaigns, and provides
strong license management controls to eliminate piracy.

ends

All trademarks mentioned in this release are the property of their
respective owners.


This e-mail has been scanned for all viruses by the HWF IT Team in co-operation with Star internet. This service is powered by Message Labs

busy month for ETI then

MCI on stream, MS announced, Wyse licensing the kit and now Parsons

not bad for a company with a turnover of 60k

imagine what will happen if they actually gain some proper traction

;-)

interesting bit in yesterdays deal was the implication that NTT (assuming the asian broadband provider is them) may want to produce a corporate version that Stream theroy couldn't do

we have had links with them in the past anyway and with MCI we now have the proof of the pudding

good stuff

zzaxx

are you more bullish on TAD now or are you still bearish?

Hard to tell at the moment. On the face of it, it's hugely improved TAD's visible revenue stream; on the other hand, the devil is in the detail. Long term, probably yes. I'm not too tempted at the moment, as I think there are better opportunities - and concerned that the dilution this year before the improved revenues come through will suppress the price; longer term, this looks like a pretty good deal.

Hurrah - endorsement indeed!!!!!

seems to me that amongst the deal people are forgetting about ETi and Cartesia doing their stuff

if both of these positively impact upon the price it will greatly reduce the amount of shares needed to pay of Stream

dd10000
Have to agree with you there, even the HB are turning bullish!
Praise indeed.

they must be able to smell more fees and we all know exo would do anything for

I hope they didn't get the same retard to prepare this note

ML, havent cut and pasted you comment yesterday as it may embarass you....

however...

TAD WONT make money from streaming games over the net! Why, because there are too many vested interests in keeping nice fat juicy boxes etc which can demand 30 per title. If you allow games to be streamed, what are the margins?

Have a look at the press statement above,

"About Endeavors Technology
Endeavors Technology is a wholly owned subsidiary of Tadpole Technology plc
(www.tadpoletechnology.com), a listed company on the London Stock Exchange
(EPIC-TAD). Its flagship product, AppExpress, enables the secure and rapid
deployment of Windows-based software "

games software is not and never will be "windows based". Ok the new acq' may well offer something different, but at what price to the existing holders?

My opinion was and still is, that TAD need to sell themselves to a bigger fish, they simply cant do it on their own. The H/W division was sold and that was a smart move.

Cartesia is a proven business with legs, but I am concerned that THEY are being used as a way of keeping costs down and not as a nice little niche market going concern. Take the money for ETI and then you have the potential to develop Cartesia as a world beater in its market. Not particularly interesting, but a going concern none the less.

I fully expect to be sl*gged off for saying this, but there you go.