MEMPHASYS LIMITED. — Capital/Financing Update 2007

Aug 30, 2007

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31[st] August 2007

Dear Shareholder

Extension of Share Purchase Offer Closing on Monday 10[th] September 2007

NuSep is pleased with the response so far to our Share Purchase Offer (SPO). However, following a number of requests from shareholders for more time to take up their entitlement, NuSep has agreed to extend the closing date until Monday 10[th] September 2007 . Given the increase in NuSep’s share price the Board of NuSep would also like small shareholders to have more time to consider their financial options.

In particular smaller shareholders can:

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• Increase their shareholding at 25 cents by acquiring new shares under the SPO;

• Purchase additional shares on the ASX to increase their shareholding above the $100 market value limit;

• Advise the Company in writing that they wish to retain their current shareholding; Sell their current shareholding on the ASX.

NuSep’s shares are currently trading at 41 cents (Thursday 30[th] August 2007). Shareholders are being offered the opportunity to buy up to $5,000 worth of new shares (20,000 shares) at 25 cents. This is a discount of approximately 40% from the current share price.

NuSep has over 2,500 shareholders who hold less than $100 worth of shares in the Company. These shareholders represent a significant cost to the Company, money that could be better spent on growing the Company. The SPO was offered by the Company as a way for these shareholders to increase their holding at 25 cents per share.

Subject to the Extraordinary General Meeting approving the change to the Company’s constitution on 25[th] September 2007, all Shareholders who hold less than $100 worth of Shares will have those shares acquired by the Directors at 25 cents per share.

Please note, the SPO is open to all shareholders , giving them the opportunity to apply for up to an additional $5,000 worth of shares (20,000 shares) at an offer price of 25 cents per share.

The Board encourages all small shareholders to consider their financial situation and take one of the four actions listed above. For further clarification please refer to the Short Form Prospectus dated 8[th] August 2007 available at www.NuSep.com or contact your financial advisor.

22 Rodborough Road � Frenchs Forest NSW 2086 � Australia � 61.2.8977.9000 � 61.2.8977.9099 fax NuSep Ltd ABN: 33 120 047 556

www.nusep.com

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The most recent trading price was 41 cents on 30[th] August 2007. The highs and lows of NuSep’s share prices since the SPO on 8[th] August 2007 can be seen in the table below:

Date			Price
High	**- **	30th August 2007	41 cents
Low	**- **	9th August 2007	28 cents

Shareholders who have already taken up the offer, but for an amount less than the maximum subscription of $5,000 (20,000 shares) are able to apply for additional shares prior to the revised close date of 10[th] September 2007 .

The revised timetable is as follows:

Event	Date
Prospectus lodged with the ASIC and ASX.	Wednesday 8thAugust 2007
Closing Date of Offer- revised	Monday 10thSeptember 2007
General Meeting to approve the issue of shares issued	Tuesday 25thSeptember 2007
under this Share Purchase Offer and amendments to the
Constitution
Holding statements dispatched and normal trading	Friday 28thSeptember 2007*
commences

• Subject to shareholder approval at the General Meeting to be held on 25[th] September 2007

If you require any additional information or replacement forms please contact the Company Secretary, Prakash Patel on (02) 8977 9000 or visit the company website www.NuSep.com.

Yours sincerely,

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Nicholas Caré Chairman