SERVICE STREAM LIMITED — M&A Activity 2006

Jul 26, 2006

Service Stream Ltd evel 12, 555 Lonsdale Street Melbourne, Victoria, 3000

Telephone: 61 3 9677 8888 Facsimile: 61.3.9677.8877 ABN: 58 008 027 978

ASX & Media Release

Total Communications Infrastructure Ltd. Level 1, 118-120 Pacific Highway St Leonards, New South Wales 2065

Telephone: 61 2 9478 9999 Facsimile: 61.2.9478.9900 ABN: 46 072 369 870

27 July, 2006

STR & TCI to Merge

• Service Stream and Total Communications Infrastructure to merge under scheme of arrangement
• Creation of leading technical and industrial services group
• Directors unanimously in favour of merger

The Directors of Service Stream Limited ("STR") and Total Communications Infrastructure Limited ("TCI") have agreed to a merger of both companies (subject to shareholder approval). The merged group will create a leading technical and industrial services group, with managed service capabilities across the telecommunications, energy and other utility sectors.

The merger will be achieved by:

• a scheme of arrangement under which TCI will acquire all of the shares in STR;
• the acquisition by STR of a substantial shareholding in TCI;
• the subsequent cancellation of the STR stake.

Chairman of STR and proposed chairman of the merged group. Mr Lyn Davies, commented:

"The merger will bring together two of Australia's leading technical services companies in the telecommunications sector and will generate significant benefits for customers, shareholders and the staff of both companies".

"The group post-merger will provide several significant added benefits including liquidity, size and scale, as well as a greater focus for the capital markets and the broader investment community".

Non-Executive Director Mr Stephe Wilks commented on behalf of the TCI Board saying, "The acquisition by STR of a major shareholding in TCI not only removes a major overhang on the Company's register, it has also created the unique opportunity for TCI to merge with a business with the demonstrated attributes of STR".

Merger Summary

STR and TCI have entered into an agreement to implement the merger under a scheme of arrangement.

1. Merger

STR shareholders will receive 2 TCI shares for every 5 STR shares they own.

The Directors of STR and TCI unanimously support the merger. Shareholder meetings to consider the merger will be scheduled in the final quarter of 2006.

Mr Patrick Flannigan will be appointed Managing Director and CEO of the merged group. Mr Rod Stanton will be appointed Executive Director of Operations of the merged entity, while still maintaining operational control of the TCI business. Importantly, the merger has been strongly endorsed by the executive management teams of both STR and TCI.

ASX & Media Release

The Board of the merged group will combine key executives and independent members of both the STR and TCI Boards with Mr Lyn Davies, currently Chairman of STR, to be appointed as the Chairman.

2. Share Acquisition

TCI's maior shareholders, Mr Jim Cooney and Ms Samantha Grant, hold approximately 49M shares in TCI.

They have agreed with STR:

• subject to the merger proceeding, to offer 9M shares to TCI shareholders at \$0.87 per share;
• subject to the approval of TCI shareholders, to sell the balance of their shareholding to STR at \$1.0137 per share.

They have also agreed to grant STR a call option over 19.9% of the shares in TCI.

The offer of 9M shares to TCI shareholders will be made on a pro rata basis.

It is intended that the offer will be managed by Bell Potter Securities Limited and dispatched to TCI shareholders with the notice of meeting.

It is proposed the offer will be underwritten to the level of \$5.0M (with any shortfall to be purchased by STR at \$1.0137 per share).

The acquisition of the TCI shares by STR will be funded by a new facility from Westpac and vendor interest free funding of \$10M which can be deferred for up to 2 years after the merger.

The acquisition of the shares by STR from the major shareholders:

• requires the approval by TCI shareholders;
• will occur immediately after TCI shareholders approve the acquisition;
• is on terms that provide for:
• o an initial payment of up to \$35M payable on completion of the merger;
• o \$10 million deferred cash payment.

The shares acquired by STR will be cancelled with shareholder approval after the merger.

Merged Group

Upon implementation of the merger, the merged entity will be known as Service Stream Limited, whilst retaining the strong brand of TCI in telecommunications infrastructure. The strategic benefits of the merged TCI and STR group will include:

• A vibrant business positioned for growth through increased scale, management depth and customer exposure resulting from:
• o Increased national coverage:
• o Experienced management team complemented by a strong Board; and
• o Ability to leverage customer relationships;
• Diversification of income stream and reduction of risk profile, combining long-term contracts with project based work:
• A pipeline of new growth opportunities across all core business areas;
• Merger synergies combined with no foreseeable cannibalisation of revenues;
• Enhanced ability to service client infrastructure beyond the telecommunications industry; and
• Potential market re rating.

ASX & Media Release

Merged Group - continued

STR's Managing Director and CEO Mr Patrick Flannigan commented:

"The merger provides operational diversification, increased financial strength and the ability to become a more valuable contributor to our customer base. We are very excited about the potential opportunities for the merged group, with STR's expertise in broadband and fixed-line infrastructure perfectly complemented by the wireless capabilities of TCI in the telecommunications industry".

"Furthermore, with combined annual revenues approaching \$300M for the 2007 financial period, and approximately 2,000 staff in 18 locations throughout Australia, the increased scale of the merged group will provide a greater capacity to invest in the right strategic opportunities in our targeted industry sectors.

TCI's CEO, Mr Rod Stanton commented:

"The merger will complement and enhance TCI's existing provision of services to customers in the telecommunications and other utilities sectors, and the increased depth in management will create more opportunities for work going forward".

"The TCI team is very excited about the enhanced capabilities of the merged entity to service existing customers and those TCI is presently targeting in the utilities sector".

Merger Process

It is expected that meetings of both TCI and STR shareholders will be held in the final quarter of 2006 to vote on the share acquisition and scheme.

Merger documentation (including independent experts' reports), will be distributed to STR and TCI shareholders in due course.

For further information please contact:

Name	Company	Contact
Patrick Flannigan, Managing Director & CEO	Service Stream	+61 3 9677-8888
Stephe Wilks, Director	Total Communications Infrastructure	+61 2 9478-9999

About Service Stream Limited (ASX Code - STR):

STR is a public company listed on the Australian Stock Exchange with annual revenues exceeding A\$162M. The Company is an Australian owned and operated industrial services enterprise with a strong IT capability, proven outsourced field force management, technical support, customer assistance and asset management capabilities. Service Stream aims to generate superior returns for shareholders by leveraging its equipment installation and maintenance capabilities across a range of infrastructure based industries.

About Total Communications Infrastructure Limited (ASX Code - TCI):

TCI is public company listed on the Australian Stock Exchange with annual revenues exceeding A\$70M. Established in 1996, TCI provides project management services specialising in technology infrastructure deployment. The Company provides infrastructure deployment skills to the telecommunications industry, and increasingly to other diversified industries such as lifecycle management, renewable energy and water.

SERVICE STREAM LIMITED ("STR") AND TOTAL COMMUNICATIONS INFRASTRUCTURE LIMITED ("TCI")

ATTACHMENT TO ASX & MEDIA ANNOUNCEMENT SUMMARY OF CERTAIN KEY TERMS OF THE MERGER DOCUMENTS

The following is a brief summary of selected key terms of the documents entered into by STR. TCI and the major shareholders of TCI in relation to the Scheme and other transactions.

MERGER IMPLEMENTATION AGREEMENT

Outline of Conditions Precedent

• Court approval for the Scheme
• No material breach or termination of the Merger Implementation Agreement
• No STR or TCI Prescribed Occurrences
• Cancellation of outstanding STR Options
• TCI shares to be issued pursuant to the Scheme being admitted for official quotation on ASX
• Material regulatory and third party consents required in relation to the Merger being obtained
• No regulatory intervention preventing implementation of the Scheme
• The shareholders of TCI approving the acquisition by STR of all or substantially all of the major shareholders' shares in TCL a capital reduction and cancellation of the shares in TCL held by STR. the provision of certain financial assistance by TCI and STR, the acquisition of STR under the Scheme and the issue of new TCI options to existing STR option holders and on the same terms as existing STR options
• STR agreeing to the cancellation of the shares in TCI acquired from the major shareholders of TCI
• The shareholders of STR approving the change of name of STR and the provision of financial assistance by STR
• No Material Adverse Change in relation to STR or TCI
• Completion of due diligence by STR and TCI.

Break Fees

STR and TCI will be entitled to receive a break fee equal to their costs incurred in relation to the Scheme and related transactions (in each case, capped at \$500,000) if:

• a condition precedent is not fulfilled as a result of the conduct of the other party or its shareholders
• the other party, or the board of the other party, fails to recommend, or withdraws a recommendation for, the Scheme (or associated transactions), or recommends an Alternative Proposal (other than as a result of a Material Adverse Change affecting the other party)
• an Alternative Proposal with respect to the other is announced or open for acceptance and is completed or substantially completed
• the Scheme does not proceed because of the acts or omissions of the other party or the board of the other party
• the other party breaches a material obligation under the Merger Implementation Agreement
• there is a Material Adverse Change in relation to the other party
• the due diligence in relation to the other party prevents the party from obtaining finance for the acquisition of TCI shares from the major shareholders
• in the case of STR only, the EBITDA of TCI for the year ending 30 June 2006 is less than \$15.39 million

The break fee arrangements have been formulated and agreed having regard to the requirements of the Corporations Act and applicable Takeovers Panel guidance notes.

ASX & Media Release

Exclusivity

The parties have agreed to the following exclusivity arrangements until the earlier of implementation of the Scheme and termination of the Merger Implementation Agreement:

• not to solicit, initiate or encourage any inquiries or discussions in relation to an alternative proposal
• not to enter into any agreements in relation to an alternative proposal, or continue any discussions in relation to such an agreement
• not to approve or recommend an alternative proposal
• not to disclose information to a third party otherwise than in the ordinary course of business
• not to do anything else which would result in any of the above occurring after the exclusivity period has expired.

STR and TCI have further agreed to notify each other of any approaches in relation to an alternative proposal.

The exclusivity obligations are subject to the duties of the directors of STR and TCI and applicable Takeovers Panel quidance notes.

SHARE PURCHASE AGREEMENT

The Share Purchase Agreement between STR and the major shareholders of TCI will not come into effect unless and until the shareholders of TCI pass certain resolutions in relation to, among other things, the acquisition of TCI shares by STR from the major shareholders.

On satisfaction of that condition, the major shareholders will sell all of their shares in TCI to STR other than the shares placed with TCI shareholder at a price of \$1.0137 per share.

The shares will be transferred to STR immediately after the TCI shareholder meeting at which the acquisition is approved.

STR will make payment to the major shareholders in two installments. The first installment will be paid immediately after the Scheme is approved. The second installment is \$10 million and can be deferred for up to 2 years.

If the Scheme does not proceed, the shares may be re-transferred to the major shareholders by a combination of put and call options at a price of \$1.0137 per share.

OPTION DEED

The major shareholders of TCI have granted STR an option to purchase up to 19.9% of TCI in the event that an alternative proposal arises in relation to TCI before the Scheme is implemented.

The option may be exercised by STR at a price of \$1.0137 per share.

The option expires on 31 March 2007.