Ann: Market Clarification Announcement, page-71

Tony was quick on the reply. Just reinforces how efficient and energetic he is as CEO:
Hi David,
Sorry, I don’t follow Hotcopper regularly. Thanks for letting me know. We looked at (and got proposals from) a number of potential partners for the hardware development project. The Avanti Med/OSI combination offered the best combination of project management, technical development and financing. The team that formed Avanti have previously run large technology development projects for a number of clients. They have strong connections with UK hospitals, European regulatory bodies and OSI, who are the major subcontractors. OSI will be doing the bulk of the design and manufacturing work (but there is also other work like usability testing in hospitals, EMC testing, etc). OSI is a subsidiary of OSI Systems, a global, US-listed customised end-to-end electronics manufacturer. They specialise in airport security X-ray machines and metal detectors, medical monitoring and anaesthesia systems and optoelectronics devices. They have annual revenue of about US$1b. They also have global manufacturing locations, giving us the option of manufacturing in either high cost (Europe) or low cost (Asia) regions. Not only do we think the Avanti/OSI team have the right skills to develop the hardware, the financials were attractive, with 1) the majority of payments made only on successful delivery of milestones such as prototypes and CE mark approval, which means less risk for us, 2) the payments are fixed (so no budget overruns, again lowering our risk) and 3) we have the flexibility of paying in shares rather than cash. Negotiating these sorts of arrangements for design consulting like this is rare. We are also very happy with the progress made so far. The work we’ve seen to date has been excellent. Tony