MACH7 TECHNOLOGIES LIMITED — Capital/Financing Update 2011

Jan 23, 2011

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RETAINED ASSETS AND CONTINUING OPERATIONS

The Company has a number of registered trademarks in Australia including “SafetyMed”, “SecureTouch” and “SyringeSafe”. It has also registered the “SecureTouch” trademark in New Zealand.

The Company initially raised capital and was listed on the ASX as a means of finalizing commercialization and commencing production of its range of safety syringes that it had already developed and for which it later received Therapeutic Goods Administration (TGA) Certification.

However it could not develop the machining capability to produce the full range of safety syringes, and suffered through limited sales of a 1 ml syringe, with failure to break through into more substantial markets as it was unable to offer a range of products. The Company was unable to successfully compete against competitors who were able to offer the full range of syringes (1ml, 2ml, 5ml and 10ml) that were required by the market.

To move forward the Company must improve its manufacturing capabilities to allow it to manufacture and offer a full range of syringes.

However before investing in new facilities and enhancing its ability to manufacture the syringe, the new Directors of the Company also believe it prudent to undergo a detailed evaluation of the technology in order to then consider how best to commercialise it. The Directors have no intention in replicating the previous commercial approach which patently did not achieve the desired outcomes.

Some options that may be available for commercialisation currently appear to be:

• Acquisition of assembly machine technology capable of producing all sizes and sole manufacture in new premises;

• Partnering with other medical technology companies to utilise the Company’s technology, share facilities and equipment and access their medical distribution network;

• Technology licensing or sales on an exclusive basis to key regions around the globe; and

• Enhancement of existing technology, and development of ancillary technology, utilising existing skills base.

The detailed review process will be conducted by suitable industry experts and it is anticipated it will establish alternative paths forward for the development of the SecureTouch syringe. This process could take up to 12 months.

The successful recapitalisation of the Company will allow it to present itself to industry as having suitable finances to commence such evaluation and to conclude its business plans.

The Company will continue to own assets associated with the SecureTouch syringe, such as the intellectual property as protected through various patents, in regions and countries including Europe, the United States of America, Africa, Australia and New Zealand.

In brief, the Company’s business plans are to:

• Retain existing intellectual property rights including all patents and trademarks relating to its medical product business;

• Review the industry within which the Company’s key asset resides as a precursor to deciding the best path forward to further develop its’ asset base of IP rights in the safety syringe markets; and

• Identify and analyse possible additional investment opportunities.

To assist the new Board in respect of technical and commercial aspects of the Company’s business, Mr John Riemelmoser (former Managing Director and Chief Executive Officer of the Company) has been retained on an ‘as required’ basis as a technical consultant for an initial term of 12 months on standard commercial terms to assist with introductions and to provide specific expertise in the field.

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Mr. Riemelmoser’s knowledge of the industry, history of the development of the technology, and industry contacts, will be beneficial to the Company, particularly in the earlier stages of the Company’s review and establishment of business development plans.

INVESTMENT OPPORTUNITIES

Although the Company’s primary focus is to continue with the development of its existing business of the SecureTouch syringe and associated technologies, a portion of the Company’s assets will be comprised of cash. As such, disclosure is required regarding the expertise of the current Directors and more specifically, how this level of expertise will assist the Company in making investment decisions.

As noted above, the Directors intend to conduct an initial review and evaluation of the existing business of the SecureTouch syringe and associated technologies. On the conclusion of this program, and subject to report outcomes, the Company will seek to further develop its existing technologies.

The funds to be raised through this Prospectus are planned to be utilized as follows:

• Review and evaluation of the existing business of the SecureTouch Syringe and associated technologies;

• Ongoing development of the SecureTouch Syringe and associated technologies; and

• Examination of alternative and additional investment opportunities.

The Directors have a broad range of commercial and public company experience. The Directors also have broad experience in project development, finance and corporate transactions for various listed and non-listed entities, which will be relevant to the assessment of potential projects for the Company. The Directors consider that their contacts and relevant experience will provide assistance in attracting and securing new projects for investment and acquisition.

The Directors are committed to the highest standards of corporate governance and they will make themselves readily available to meet the requirements of the Company and its operations going forward. The Board will ensure that they devote sufficient time, attention and skill to the duties of this position and the Company’s business.

Other than the proposed expenditure budget detailed below, and the discussion of the review and development of the existing business above, there is no specific investment plan currently in place regarding the Company’s future intentions. Investment strategies may be adopted as and when suitable opportunities are identified by the Board. The Company may be subject to additional risks in the future relating to these investments that cannot be identified as at the date of this Prospectus.

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EXPENDITURE BUDGET

In summary, the Company proposes to apply the funds raised from the Offer as set out below in relation to funding the Company’s development of its existing technology, providing funding for the identification of other business opportunities and the expenses of the Offer and the recapitalisation of the Company.

Maximum Subscription

Use of Funds – Expenditure Budget	Year 1	Year 2	Total
Review and evaluate the existing businessof the SecureTouch syringe and associatedtechnologies,includingBusinessPlandevelopment	$150,000	-	$150,000
Recommence commercialisationof theSecureTouchsyringeandassociatedtechnologies and maintenance of IP rights	$250,000	$550,000	$800,000
Identification and consideration of otherbusiness opportunities	$200,000	$100,000	$300,000
Expenses associated with the Offer andRecapitalisation Proposal	$505,000	-	$505,000
General working capital	$150,000	$295,000	$445,000
Total Funds Utilised	$1,255,000	$945,000	$2,200,000

On completion of the Offer the Directors believe the Company will have adequate working capital to meet its stated objectives.