CYCLIQ GROUP LTD — Capital/Financing Update 2008

Oct 16, 2008

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----- Start of picture text ----- ACN 119 749 647----- End of picture text -----

17 October 2008

ASX Limited Companies Announcement Office 20 Bridge Street SYDNEY NSW 2000

APPENDIX 3B AND NOTICE UNDER SECTION 708A(5) OF THE CORPORATIONS ACT

Further to the company’s announcement on 9 September 2008, the Directors are pleased to advise that an initial allotment of 2,583,333 ordinary fully paid shares at an issue price of $0.27 per share has been completed. A further 1,300,000 ordinary fully paid shares will be allotted subject to shareholder approval at the company’s upcoming annual general meeting. In addition, subject to shareholder approval, one free attaching option will be issued for every two shares applied for and allotted.

The company also advises that due to the change in economic circumstances, it has agreed to a change in the terms of the proposed convertible notes announced on 9 September 2008. The amount to be raised pursuant to the Notes will be up to $2,400,000. The principle terms of the Notes will be as follows:

• (i) Redemption Date: 30 September 2010;

• (ii) Convertible into ordinary fully paid shares at an issue price determined as the lesser of:

  • (a) 35 cents per share; or

  • (b) the price that is 85% of the average market price of the company’s ordinary fully paid shares calculated over the last 5 days on which sales were recorded before the date of conversion and issue.;

• (iii) Subject to the Corporations Act, ASX Listing Rules and shareholder approval, if necessary, convertible, in whole or part, by the Noteholder at any time from the date of issue and prior to the Redemption Date; and by the Company where the closing price of the Company’s shares is 35 cents or greater for 5 consecutive trading days;

• (iv) Shares issued upon conversion of any Note will carry standard rights applicable to quoted ordinary shares in the Company and will, from the date of issue, rank equally with fully paid ordinary shares currently on issue;

• (v) Interest rate – 10% per annum;

• (vi) The company does not intend to list the Notes for quotation on ASX and it is not obligated to do so;

Suite B 150 Hay Street Subiaco Western Australia 6008 Phone 08 9388 8439 Fax 08 9388 8450

• (vii) The Notes shall not provide for any voting rights at shareholder meetings of the Company;

• (viii) Unless converted or redeemed during the term, the Notes will be redeemed at the Redemption Date at the face value of the Notes;

• (ix) The Notes will be unsecured and the Noteholder will rank equally with all other unsecured creditors of the Company.

An Appendix 3B in respect to the issue of 2,583,333 ordinary fully paid shares is attached.

The Company gives this notice pursuant to section 708A(5)(e) of the Corporations Act .

The shares were issued without disclosure to investors under Part 6D.2 of the Corporations Act in reliance on section 708A(5).

The Company as at the date of this notice has complied with:

• (a) the provisions of Chapter 2M of the Corporations Act as they apply to the Company; and

• (b) section 674 of the Corporations Act .

As at the date of this notice, there is no excluded information for the purposes of section 708A(7) and (8) of the Corporations Act .

Yours faithfully

C Willis Director