BIOXYNE LIMITED — Capital/Financing Update 2004

Jul 26, 2004

Rule 2.7, 3.10.3, 3.10.4, 3.10.5

Appendix 3B

New issue announcement, application for quotation of additional securities and agreement

Information or documents not available now must be given to ASX as soon as available. Information and documents given to ASX become ASX's property and may be made public.

Introduced 177/96. Origin: Appendix 5. Amended 1/7/98, 1/9/99, 1/7/2000, 30/9/2001, 11/3/2002, 1/1/2003.

Name of entity

VRI BioMedical Limited

ABN

97 084 464 193

We (the entity) give ASX the following information.

Part 1 - All issues

You must complete the relevant sections (attach sheets if there is not enough space).

$\mathbf{1}$ ⁺Class of ⁺securities issued or to be issued

Options convertible into ordinary shares

• $\overline{2}$ Number of ⁺securities issued or to be issued (if known) or maximum number which may be issued
• Principal terms of the ⁺securities 3 (eg, if options, exercise price and date; if partly paid expiry *securities, the amount outstanding and due dates for payment; if +convertible securities, the conversion price and dates for conversion)

Approximately 20,994,625 options

Bonus options issued for nil consideration exercisable at \$0.25c each on or before 30^th June 2006

⁺ See chapter 19 for defined terms.

4	Do the securities rank equally in all respects from the date of allotment with an existing "class of quoted securities?	N 0
	If the additional securities do not rank equally, please state: the date from which they do	Shares issued upon exercise of the Options will rank equally with existing ordinary shares.
	which the extent to they ۰ participate for the next dividend, case of. $fin$ the $\ddot{a}$ trust.	Options do not give rise to an entitlement to participate in dividends.
	distribution) or interest payment • the extent to which they do not rank equally, other than in relation to the next dividend, distribution or interest payment	The exercise price of Options (\$0.25) and the expiry date (30 June 2006)
5	Issue price or consideration	Nil
6	Purpose of the issue (If issued as consideration for the acquisition of assets, clearly identify those assets)	In support of the company's growth strategy and to reward shareholders for their loyalty to the company
7	Dates of entering *securities into uncertificated holdings or despatch of certificates	$12^{th}$ August 2004
8	of and	Number	+ Class
	Number †class all *securities quoted on ASX	104,973,127	VRI - Ordinary fully paid shares
	(including the securities in clause 2 if applicable)	34,543,372	VRIO Options expiring
			6/3/06 exercisable at 75c
		20,994,625	VRIOA Options $\overline{\phantom{m}}$ expiring 30/6/06
			exercisable
			at 25c

⁺ See chapter 19 for defined terms.

		Number	+ Class
9	Number and telass of aIl *securities not quoted on ASX (including the securities in clause 2 if applicable)	1,900,00	VRIAK	Options $\equiv$ expiring 23/11/06 exercisable at 75c
		300,000		VRIAM - Options expiring 13/6/07 exercisable at 75c
		980,000		VRIAO - Options expiring 13/10/05 exercisable at 50c
		300,000	VRIAS	- Options expiring 22/8/07 exercisable at 75c
		750,000	VRIAP	- Options expiring 14/1/08 exercisable at 75c
10	Dividend policy (in the case of a Subject to dividend policy on options being

trust, distribution policy) on the exercised

Part 2 - Bonus issue or pro rata issue

11	holder approval security Is. required?	No
12	Is the issue renounceable or non- Non-renounceable renounceable?
13	Ratio in which the "securities will be offered	One option for every five ordinary shares held
14	Class of securities to which the offer relates	Ordinary shares
15	determine *Record date to. entitlements	6 th August 2004

⁺ See chapter 19 for defined terms.

16	Will holdings on different registers (or sub-registers) be aggregated for calculating entitlements?	Yes
17	Policy for deciding entitlements in relation to fractions	Fractions will be rounded up to nearest whole number
18	Names of countries in which the entity has *security holders who will be. not sent new issue documents Note: Security holders must be told how their entitlements are to be dealt with. Cross reference: rule 7.7.	China, Germany, United Kingdom, Hong Kong, Indonesia, Italy, Malaysia, Singapore, Thailand and USA
19	Closing date for receipt ο£ acceptances or renunciations	Not applicable

⁺ See chapter 19 for defined terms.

20.	Names of any underwriters	Not applicable
21	Amount of any underwriting fee or	Not applicable
	commission
22	Names of any brokers to the issue	Not applicable
23.	Fee or commission payable to the	Not applicable
	broker to the issue
24	fee Amount of any handling	Not applicable
	payable to brokers who lodge acceptances or renunciations on
	behalf of *security holders
25	If the issue is contingent $_{\rm on}$	Not applicable
	"security holders" approval, the date of the meeting
26.	Date entitlement and acceptance form and prospectus or Product	$30th$ July 2004
	Disclosure Statement will be sent to persons entitled
27.	If the entity has issued options, and the terms entitle option holders to	$27th$ July 2004
	participate on exercise, the date on which notices will be sent to option
	holders
28	Date rights trading will begin (if Not applicable
	applicable)
29.	Date rights trading will end (if	Not applicable
	applicable)
30	How do *security holders sell their	Not applicable
	entitlements in full through a
	broker?
31	How do *security holders sell part of their entitlements through a	Not applicable
	broker and accept for the balance?

⁺ See chapter 19 for defined terms.

32 How do *security holders dispose of their entitlements (except by sale through a broker)?

33 *Despatch date Not applicable

16^th August 2004

Part 3 - Ouotation of securities

You need only complete this section if you are applying for quotation of securities

34	Type of securities
	(tick one)

$(a)$

$(b)$

Securities described in Part 1

All other securities
----------------------	--

Example: restricted securities at the end of the escrowed period, partly paid securities that become fully paid, employee incentive share securities when restriction ends, securities issued on expiry or conversion of convertible securities

Entities that have ticked box 34(a)

Additional securities forming a new class of securities

Tick to indicate you are providing the information or documents

• If the ⁺securities are +equity securities, the names of the 20 largest holders of the 35 additional *securities, and the number and percentage of additional *securities held by those holders
• 36 If the *securities are *equity securities, a distribution schedule of the additional *securities setting out the number of holders in the categories $1 - 1.000$ $1,001 - 5,000$ $5,001 - 10,000$ $10,001 - 100,000$ 100,001 and over
• 37 A copy of any trust deed for the additional *securities

⁺ See chapter 19 for defined terms.

Entities that have ticked box 34(b)

• Number of securities for which 38 *quotation is sought
• 39 Class of *securities for which quotation is sought
• $40¹$ Do the *securities rank equally in all respects from the date of allotment with an existing "class of quoted *securities?

If the additional securities do not rank equally, please state:

• the date from which they do
• the extent to which they participate for the next dividend. (in the case of a trust, distribution) or interest payment
• the extent to which they do not rank equally, other than in relation to the next dividend, distribution or interest payment
• 41 Reason for request for quotation now

Example: In the case of restricted securities, end of restriction period

(if issued upon conversion of another security, clearly identify that other security)

Number and *class of all *securities 42 quoted on ASX (including the securities in clause $38$ )

Number	+Class

⁺ See chapter 19 for defined terms.

Ouotation agreement

• $\mathbf{1}$ *Quotation of our additional *securities is in ASX's absolute discretion. ASX may quote the *securities on any conditions it decides.
• $\overline{2}$ We warrant the following to ASX.
• The issue of the *securities to be quoted complies with the law and is not for $\bullet$ an illegal purpose.
• There is no reason why those *securities should not be granted *quotation.
• An offer of the "securities for sale within 12 months after their issue will not require disclosure under section $707(3)$ or section $1012C(6)$ of the Corporations Act.

Note: An entity may need to obtain appropriate warranties from subscribers for the securities in order to be able to give this warranty

• Section 724 or section 1016E of the Corporations Act does not apply to any ٠ applications received by us in relation to any *securities to be quoted and that no-one has any right to return any *securities to be quoted under sections 737, 738 or 1016F of the Corporations Act at the time that we request that the 'securities be quoted.
• We warrant that if confirmation is required under section 1017F of the $\bullet$ Corporations Act in relation to the *securities to be quoted, it has been provided at the time that we request that the "securities be quoted.
• If we are a trust, we warrant that no person has the right to return the $\bullet$ *securities to be quoted under section 1019B of the Corporations Act at the time that we request that the "securities be quoted.

$+$ See chapter 19 for defined terms.

• $\overline{3}$ We will indemnify ASX to the fullest extent permitted by law in respect of any claim, action or expense arising from or connected with any breach of the warranties in this agreement.
• $\overline{4}$ We give ASX the information and documents required by this form. If any information or document not available now, will give it to ASX before +quotation of the 'securities begins. We acknowledge that ASX is relying on the information and documents. We warrant that they are (will be) true and complete.

Anopfin

Sign here:

Company secretary

Date: 27 July 2004

Print name: Paul B Magoffin

= = = = = = = = = = = = = = = = = = =

$\overline{\text{+ See chapter 19 for defined terms.}}$