Ann: Response to ASX Appendix 4C Query, page-2

All in all, I'm not concerned by the cash situation right now.

The primary reason behind my view is that:

• Revenue growth has returned to its previous trajectory (approx 15% per quarter) and the company have given indications that it will continue
• Costs continue to remain stable each quarter
• Plummer is committed to this do or die and will supply further funds if necessary
• 1ST have the option of placing the shortfall from the right issue if needed (but appear to be aiming not to)

If 1ST had met their targets on the rights issue they would be in the clear right now, but as it stands, it looks like one final (small) amount needs to be raised by either debt or equity.

However, we are very close to having this business stand on its two feet with positive cashflow. The share price isn't factoring this in right now. Which means that if it is achieved, the share price will be moving north, and fast.