2.1 Notice Requirements for Resolution 1
Between 13 May 2005 and 25 August 2005 the Company issued a number of Shares to various allottees.
Details of these issues are set out in the schedule in Section D.
Because of the operation of Section 708 of the Corporations Act, the Company was not required to provide
any of the allottees with a disclosure document.
In issuing the securities, described in Section D below, the Company did not breach Listing Rule 7.1.
Listing Rule 7.1 provides that a company must not issue equity securities, or agree to issue equity securities
(which includes shares and options) 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 issued capital of the company preceding the issue. Listing Rule 7.4 allows
for subsequent shareholder approval if the company did not breach Listing Rule 7.1 at the time of issue and
the holders of ordinary shares subsequently approve it.
Although Shareholder approval was not required for the issue of the Shares referred to in the table below,
the Company now seeks Shareholder approval of these issues in the manner provided by Listing Rule 7.4,
because this will enable the Company to issue further equity securities to capitalise on future expansion,
acquisition and product commercialisation opportunities without needing to obtain prior Shareholder
approval.
The amount raised by the issue of Shares for which Shareholder approval is sought is set out in the table
below.
2.2 Notice Requirements for Resolution 2
Pursuant to Section 260B(5) of the Corporations Act 2001, the following information is provided regarding
the section 260B(2) approval to explain the background to Resolution 2, particulars of the proposed financial
assistance and all other information known to the Company that is material to the decision on how to vote
on Resolution 2, other than information that it would be unreasonable to require the Company to disclose
because the Company has previously disclosed the information to its members.
On 24 August 2005 the Company and the company’s wholly-owned subsidiary NSNH entered into a share
purchase agreement with NSS BV and NSNA whereby NSNH will acquire the entire issued capital of NSN
from NSNA.
As a component of that transaction, NSN will, on completion of the acquisition, grant a fixed and floating
charge over its assets to secure its obligations, and those of the Company and NSNH under certain
transaction documents, including the share purchase agreement and a satellite services agreement.
Section 260B(2) of the Corporations Act requires that, where a company giving financial assistance for the
acquisition of its shares will be a subsidiary of a listed domestic corporation immediately after the
acquisition of its shares, the financial assistance must be approved by a special resolution passed at a
general meeting of that listed domestic corporation. As NSNH is a wholly owned subsidiary of the Company,
NSN will be a subsidiary of the Company immediately after the acquisition of its shares.
Shareholders are also referred to the Prospectus for a non-renounceable rights issue. On 20 September
2005, the Company announced that it is proposing to raise up to $15 million to fund the balance of
purchase price for the acquisition of NSN and to provide working capital. The Prospectus contains a full
description of the terms and conditions of the acquisition of NSN and each of the transaction documents.
The Prospectus will be sent to shareholders in accordance with the timetable set out in the announcement
made by the Company on 20 September 2005.
2.3 Notice Requirements for Resolution 3
Pursuant to Listing Rule 7.3, the following information is provided regarding Listing Rule 7.1 approval:
(a) Shares will be issued to Findlays as deemed repayment of a loan of $1.66 million provided by
Findlays to the Company at an issue price per Share of the lower of $0.02 and 80% of VWAP
calculated in the ten trading days prior to the date of the General Meeting.
(b) If Shareholder approval is obtained, the issue and allotment of the Shares will occur on a date which
is no later than 3 months after the date of this General Meeting.
(c) The Company will apply to the ASX to have the Shares Officially Quoted and these Shares will rank
equally with all the other Shares on issue. In all other respects the rights and entitlements of the
holders in respect of the Shares will be identical to the rights and entitlements of the holders of
existing issued Shares.
(d) The Company used the Funds obtained from Findlays to fund (in part) the payment by NSNH of the
deposit of US$1.5 million for the acquisition of NSN and associated transaction costs.
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