The circuit is basically a radio frequency (RF) oscillator that operates around 100 MHz. Audio picked up and amplified by the electret microphone is fed into the audio amplifier stage built around the first transistor. Output from the collector is fed into the base of the second transistor where it modulates the resonant frequency of the tank circuit (L1 coil and the trimcap) by varying the junction capacitance of the transistor. Junction capacitance is a function of the potential difference applied to the base of the transistor T2. The tank circuit is connected in a Hartley oscillator circuit.
MIC=Electret Condenser Type