IONIC RARE EARTHS LIMITED — Capital/Financing Update 2004

Apr 12, 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 1/7/96. 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

EZENET LIMITED

ABN

84 083 646 477

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).

	+ Class of + securities issued or to be issued	Ordinary fully paid shares Options expiring 30 June 2007 Options expiring 31 December 2006
2	Number of $\pm$ securities issued or to be issued (if known) or maximum number which may be issued	1,994,168 ordinary shares 165,750 30 June 2007 options 125,000 31 December 2006 options
3.	Principal terms of the + securities (eg, if options, exercise price and expiry date; if partly paid 'securities, the amount outstanding and due dates payment; if + convertible fоr securities, the conversion price and dates for conversion)	Shares are fully paid ordinary shares Options exercisable at \$0.15 expiring 30 June 2007 exercisable at \$0.40 Options -31 expiring December 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?
	If the additional securities do not rank equally, please state: the date from which they do extent to which the 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	equally with existing ordinary shares	Shares to issue on exercise of options will rank
5.	Issue price or consideration	with free attaching option to employees exercise of option	Shares at an issue price of 15 cents per share Shares at an issue price of 23.8 cents per share Shares at an issue price of 15 cents per share on
6.	Purpose of the issue	Shortfall on pro-rata rights issue;
	(If issued as consideration for the acquisition of assets, clearly identify those assets)	Issue to employees; Conversion of 30 June 2007 options.
7	Dates of entering + securities into 2 April, 2004
	uncertificated holdings or dispatch of certificates
8	Number and + class οf all securities quoted ASX. on (including the securities in clause 2 if applicable)	Number 62,081,443 34,003,001	+ Class Ordinary shares 30 June 2007 options

$+$ See chapter 19 for defined terms.

$\ddot{9}$ Number and ⁺class of all ⁺securities not quoted on ASX (including the securities in clause 2 if applicable)

Number	+ Class
125,000	Options with expiry dated 31 December 2006

Dividend policy (in the case of a $\boxed{\text{It is not expected a dividend will be declared in}}$ $10\,$ trust, distribution policy) on the the near future increased capital (interests)

Part 2 - Bonus issue or pro rata issue

11	holder approval security Ιs required?	Not applicable
12	Is the issue renounceable or non- renounceable?	Not applicable
13	Ratio in which the + securities will be offered	Not applicable
14	+ Class of + securities to which the offer relates	Not applicable
15	+ Record date determine to entitlements	Not applicable
16	Will holdings on different registers (or subregisters) be aggregated for calculating entitlements?	Not applicable
17	Policy for deciding entitlements in relation to fractions	Not applicable
18	Names of countries in which the entity has *security holders who will not be sent new issue documents	Not applicable
	Note: Security holders must be told how their eatitiements are to be dealt with.
	Cross reference: rule 7.7.
19	Closing date receipt for οf acceptances or renunciations	Not applicable

⁺ See chapter 19 for defined terms.

Appendix 3B New issue announcement

20	Names of any underwriters	Not applicable
21	Amount of any underwriting fee or commission	Not applicable
22	Names of any brokers to the issue	Not applicable
23.	Fee or commission payable to the broker to the issue	Not applicable
24.	Amount of any handling fee payable to brokers who lodge acceptances renunciations on behalf of Οŕ *security holders	Not applicable
25	If the issue is contingent on 'security holders' approval, the date of the meeting	Not applicable
26	Date entitlement and acceptance form and prospectus or Product Disclosure Statement will be sent to persons entitled	Not applicable
27	If the entity has issued options, and the terms entitle option holders to participate on exercise, the date on which notices will be sent to option holders	Not applicable
28.	Date rights trading will begin (if applicable)	Not applicable
29.	Date rights trading will end (if applicable)	Not 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 broker and accept for the balance?	Not applicable

$+$ See chapter 19 for defined terms.

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

33 ⁴Despatch date Not applicable

Not applicable

Part 3 - Quotation of securities

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

• 34 Type of securities (tick one)
• Securities described in Part 1
• $(b)$

$(a)$

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

See Annexure

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 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

³⁵

⁺ See chapter 19 for defined terms.

Entities that have ticked box 34(b)

38	Number of securities for which + quotation is sought	Not applicable
39.	Class of $\pm$ securities for quotation is sought	which Not applicable
40	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 ٠ the extent $f_{\rm O}$ which they participate for the next dividend, $\alpha f$ (in the case 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	Not applicable
41	Reason for request for quotation now. Example: In the case of restricted securities, end of restriction period (if issued upon conversion οſ another security, clearly identify that other security)	Not applicable
42	Number and + class of all + securities quoted on ASX (including the securities in clause 38)	Number + Class

$+$ See chapter 19 for defined terms.

All entities

Fees

$43$ Payment method (tick one)

Cheque to be provided

Electronic payment made Note: Payment may be made electronically if Appendix 3B is given to ASX electronically at the same time.

Periodic payment as agreed with the home branch has been arranged Note: Arrangements can be made for employee incentive schemes that involve frequent issues of securities.

Ouotation agreement

• $\mathbf{I}$ +Quotation of our additional +securities is in ASX's absolute discretion. ASX may quote the ⁺securities on any conditions it decides.
• Ò. We warrant the following to ASX.
• The issue of the 'securities to be quoted complies with the law and is not for 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 thic warranty

• Section 724 or section 1016E of the Corporations Act does not apply to any 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 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 *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.

	(Original signed by Simon Watson)
Sign here:
	(Company secretary)

Print name: Simon Watson

$=$ $=$ $=$ $=$ $=$ $=$

⁺ See chapter 19 for defined terms.