Tiger Telematics UK Files For Bankruptcy

At the close of business on Friday January 20, 2006, the Company’s wholly owned subsidiary, Gizmondo (Europe) Limited (“Gizmondo Europe”) filed a High Court application for administration in the United Kingdom. The filing provides Gizmondo Europe with a moratorium in order to affect a financial restructuring of the business. The Gizmondo Europe will have a court hearing on 31 January 2006 to grant the administration order. During the interim period, Gizmondo Europe is immediately subject to protection of the Court and all enforcement actions of creditors are automatically stayed.

The Company intends to use funds from its recently announced $5 million bridge loan to reinvest in the business in the in UK and to restructure the overall debt of the European business. Gizmondo Europe Limited made a reduction in payroll of approximately 50% of monthly staff costs during the week prior to the court application to reduce overall operating expenses of the business and significantly improve its prospects for a successful turnaround.

Gizmondo Europe continues to trade as normal during this interim time period. The Company anticipates a similar action in Sweden for the game subsidiary of Gizmondo Europe and for the Company’s Gizmondo Studios, Sweden AB subsidiary within the next few days. The action does not affect any other subsidiary of the Company including its United States operations and sales under Gizmondo USA Inc.