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Out of interest, before today's announcement:
1)
5m shares had been issued by MUL back on 19 September 2002 for working capital (WKC) purposes @2.8c = $140,000;
2)
87m shares were issued on 28 October 2002 for debt retirement /debt conversion (DRC) and WKC purposes @1c = $870,000;
3)
23m shares were issued on 23 May 2003 for VSAT project (VSAT) purposes @0.007c = $161,000;
4)
20m shares were issued on 23 May 2003 for WKC purposes @1c = $200,000;
5)
31m shares were issued on 6 June 2003 for VSAT and WKC purposes @1c = $310,000; and
6)
25m shares were issued on 12 June 2003 for VSAT and WKC purposes @1.3c = $325,000.

The ASX has a Listing Rule requirement that precludes the issue or allotment of more than 15% of a company's currently issued capital, during any 12 month period.

Under Listing Rule 7.1, MUL cannot issue new shares, or "agree to issue equity securities, without the approval of shareholders if the number of equity securities to be issued in any 12 month period (including equity securities issued on the exercise of any convertible securities) exceeds 15% of the issue capital of the Company preceding the issue)."
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extracted from MUL's Notice of General Meeting for 28/08/03.

On 23 July 2003, MUL issued a Notice of general Meeting which is to be convened on 28 August 2003 for purposes of ratifying the past issue of shares. In particular, the affected shares are all those which have been issued since May 2003.

Those shares issued before then (ie: back in September and October 2002) were likely ratified at the AGM of 27 November 2002.

With 763m shares currently on issue, that would suggest an issue ceiling of 114m shares. In reality, MUL should have been permitted to allot /issue somewhere between 86m and 114m shares during the past 12 months without the need for shareholder approval being obtained. However, with 191m shares having been issued since September 2002 (expanding the capital base by 1/3 since then (and by 25% measured off today's base), MUL has now hit their capacity constraints from a share issuing perspective. Now, in order to go forward, they will need shareholder approval. Hence, the need for the forthcoming meeting on the 28th.

Trouble is, today's announcement of the $3.5m loan funding announcement, convertible into shares at any time following 23 August 2003, for an undisclosed conversion price, is likely to involve a prospective issue of somewhere between 50 -70m shares, depending upon the level of pricing applied (ie: 70m @5c, 50m @7c, 58m shares if @15% discount to a 7c share price).

If converted, the resulting share issue could further constrain MUL's ability to raise capital going forward (ie: due to the prospective 114m new issue ceiling).

It is, therefore, likely that today's loan announcement will involve:
1)
conversion at 15% discount to the weighted average share price in the 5 trading days preceding the General Meeting (ie: indicative share price randing towards 6c);
2)
capitalised interest, also convertible into shares (query, the loan has been announced, but at what interest rate?); and
3)
may well require a further General Meeting to be held later in the year in order to further ratify the proposed loan /share issue.

If, however, all converted into shares @6c on or after 23 August, this will mean that MUL's share capital base has been expanded by ~250m shares in the space of 12 months (not counting Option conversions, Director's share issues in lieu of fees being paid, etc). Such an issue history has effectively expanded MUL's capital base by ~44% since September 2002.