BABYLON PUMP & POWER LIMITED — Proxy Solicitation & Information Statement 2011

Aug 10, 2011

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Thursday�11�August�2011�

IM�Medical�Limited�

Dear�Shareholder�

The�Company�is�aware�some�shareholders�have�received�a�letter�from�Dr�Laurie�Williams� seeking�their�proxies�in�order�to�vote�against�the�resolutions�that�will�be�considered�at�the� Company’’s�General�Meeting�on�16�August�2011.�

In�the�letter�Dr�Williams�claims�he�oversaw�the�original�success�of�the�Company�and�makes�a� number�of�other�unsubstantiated�claims.�

Your�current�Directors�do�not�agree�with�the�statements�made�by�Dr�Williams�in�his�letter.�� Shareholders�should�be�aware�that�significant�losses�were�incurred�by�the�Company�while� Dr�Williams�was�Managing�Director�(appointed�in�June�2005)�and�Chairman�(appointed�in� February�2006).���

Under�Dr�Williams,�the�Company�wrote�the�value�of�its�Intelliheart�business�down�from� $1.29�million�to�nil�in�the�year�to�30�June�2005�and�reported�a�loss�of�$3.2�million�in�the�year� to�30�June�2006.��In�November�2006,�Dr�Williams�advised�shareholders�that�the�Company� expected�to�move�into�operating�profit�in�the�New�Year.��Dr�Williams�subsequently�resigned� as�Chairman�in�December�2006.��The�Company�reported�a�further�loss�of�$1.1�million�in�the� half�year�to�31�December�2006�and�a�loss�of�$3.2�million�for�the�full�year�to�30�June�2007.�

Your�Directors�do�not�recommend�you�give�your�proxies�to�Dr�Williams.��If�you�have�already� done�so,�you�are�entitled�to�resubmit�your�proxy�as�described�below.�

General�Meeting�

Since�the�appointment�of�new�Directors�to�the�Board�in�March�this�year,�the�Company�has� been�focused�on�stabilising�the�Company’’s�financial�position�and�restoring�shareholder� value.��The�resolutions�at�the�General�Meeting�seek�your�approval�for�important�steps�in� restructuring�and�recapitalising�the�Company.��If�the�resolutions�are�not�approved,�the� Directors�are�of�the�opinion�that�there�is�a�likelihood�that�the�Company�will�face�solvency� issues�that�may�require�the�Board�to�consider�voluntary�administration.��In�this�situation�any� residual�value�for�shareholders�would�be�uncertain.�

Your�vote�at�the�General�Meeting�is�important�and�the�Directors�encourage�you�to�submit� your�Proxy�Forms�or�attend�the�General�Meeting�to�vote�on�the�resolutions.���

The�independent�Directors�recommend�shareholders�vote�in�favour�of�all�resolutions.�

IM Medical Limited T 03 9860 0900

Level 1 117 Church Street F 03 9860 0999 Hawthorn. VIC 3122 Aust E info@immedical.com.au ACN 009 436 908 W immedical.com.au

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Proxy�forms�(and�any�Power�of�Attorney�under�which�it�is�signed)�must�be�received�by� Security�Transfer�Registrars�Pty�Ltd�no�later�than�2.00pm�(EST)�on�Sunday�14�August�2011,� being�48�hours�before�the�time�for�holding�the�meeting.��Any�Proxy�form�received�after�that� time�will�not�be�valid�for�the�scheduled�meeting.�

Proxies�may�be�lodged�in�person,�by�mail�or�by�fax�or�email�to:��

Security�Transfer�Registrars�Pty�Ltd� PO�BOX�535� Applecross,�Western�Australia�6953�

Street�Address:� Alexandrea�House,�Suite�1� 770�Canning�Highway� Applecross,�Western�Australia�6153�

Telephone�+61�8�9315�2333�

Facsimile�+61�8�9315�2233�

Email�registrar@securitytransfer.com.au

If�you�have�already�submitted�your�Proxy,�you�are�entitled�to�resubmit�it�if�you�wish�to� change�your�vote.���

If�you�have�misplaced�your�Proxy�form,�or�you�would�like�to�resubmit�your�Proxy,�please� contact�the�registry�by�phone�or�email�for�a�replacement,�or�use�the�proxy�form�attached�to� the�Notice�of�Meeting�announced�to�the�ASX�on�18�July�2011.�

Yours�Sincerely�

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Nigel�Blaze� Chairman� IM�Medical�limited�

IM Medical Limited T 03 9860 0900 Level 1 117 Church Street F 03 9860 0999 Hawthorn. VIC 3122 Aust E info@immedical.com.au ACN 009 436 908 W immedical.com.au