video on demand

29 March 2004
Australian Stock Exchange Limited
Companies Announcements Office
4th Floor
20 Bridge Street
SYDNEY NSW 2000
ACQUIRES BALANCE OF SHARES IN SX TECHNOLOGY PTY LTD
The Directors of The Swish Group Limited (“Swish Group”) are delighted to announce that they have
today reached agreement with their joint venture partner Xerts Hotel Technology Pty Ltd (“Xerts”), to
acquire their shareholding in the SX Technology Pty Ltd (“SX Technology”) joint venture. SX
Technology will now be 100% owned by Swish Group. As previously announced, SX Technology has
developed a new, significantly more functional and cost effective, digital video on demand and high speed
internet system for hotels, apartments and multi-unit developments (“Hotelinx System”).
The consideration for the purchase is to be satisfied through the issue to Xerts of 6,000,000 fully paid
ordinary shares in Swish Group, at a price of 10 cents per share. This is significantly above the weighted
average closing price of Swish Group shares over the last 30 days of 4.7 cents. 50% of the shares to be
issued are to be escrowed for 12 months and 50% for 24 months from the date of issue. The agreement
also provides for Xerts to receive a royalty based on revenues earned by SX Technology from the
Hotelinx System for 10 years and a percentage of the profits derived from business introduced by Xerts
and their associated companies in the United Arab Emirates (“UAE”) and other countries in the Middle
East.
The opportunity for Swish Group to acquire the outstanding interest of Xerts in the joint venture has arisen
as a result of the decision by the UAE based shareholders in Xerts to withdraw from all of their Australian
investments, of which their interest in SX Technology is only one. The nature of the original joint venture
agreement between Swish Group and Xerts enabled Swish Group to acquire the shares in SX
Technology on extremely favourable terms. The Australian directors of Xerts will remain directors of SX
Technology and continue to assist with the roll out of the business in Australia and internationally. Swish
Group will appoint two further directors to the SX Technology board.
The Hotelinx System enables a significantly greater number of movie choices by hotel guests (delivering
150 to 200 movies or more on demand) and high speed internet access enabling guests to more easily
connect their own PC or, alternatively, access the internet through the television screen in their hotel
room. The Hotelinx System enables guests to pause, bookmark, fast forward or rewind their movie,
which based on the Company’s experience (through the Hotelinx System operating at the Ramada Hotel
in Melbourne), is likely to significantly increase hotel guest utilisation of the system. The inclusion of other
features in the Hotelinx System including high speed internet access, the ability to provide information on,
and access services available both within the hotel and in the city, in which the hotel is located, provide
significant additional revenue opportunities for the Company.
As announced on 19 March 2004, the Company has recently finalised an agreement to install the
Hotelinx System in the 190 room Batman’s Hill hotel in Melbourne. The agreement, which is for a term of
five years, provides for the Company to receive a majority of the movie and internet revenues received
from guests who use the Hotelinx System.