SKS TECHNOLOGIES GROUP LIMITED — Capital/Financing Update 2014

May 25, 2014

==> picture [533 x 58] intentionally omitted <==

STOKES TO RAISE $2.55M TO EXPAND HIGH VALUE TECHNOLOGY PRODUCTS

NON-RENOUNCEABLE FULLY UNDERWRITTEN 1:4 RIGHTS ISSUE OF UNSECURED CONVERTIBLE NOTES

Melbourne 26 May 2014: Stokes Limited (ASX:SKS) is pleased to announce a nonrenounceable rights issue offering shareholders whose registered addresses are within Australia and New Zealand ( Eligible Shareholders ) the opportunity to subscribe for a 3 year, 10% pa convertible note ( Convertible Note ) for every four fully paid ordinary shares held in the Company as at 7.00pm on Monday 2 June 2014 at a price of $0.35 each to raise approximately $2.55 million ( Rights Issue ).

The offering is fully underwritten by JM Financial Group Ltd.

Proceeds from the Rights Issue will be used to fund the expansion of the Stokes Technologies Division, for general working capital purposes and to retire debt associated with recent expansion and sales activities.

Stokes Managing Director Mr Con Scrinis commented as follows “During the 2013 calendar year the Company undertook and completed the restructuring of its appliance parts, services and manufacturing divisions. Recently Stokes established a new Technologies Division to diversify revenue streams and expand its sales of innovative technologies products & services.

The Stokes Technologies Division currently consists of Audiovisual and Lighting Solutions for the commercial and industrial markets.

The Company will exploit the extensive experience and history of the Stokes board and senior management team in successful company building. Con Scrinis was the founder of Moonlighting Pty Ltd, a leading manufacturer and distributor of commercial and industrial lighting products in Australia. Greg and Peter Jinks were the founders of KLM Group Ltd, which was a leading electrical contractor that housed an audiovisual division. The expertise and industry relationships of the Stokes leadership team enable expansion into new and related high value added products.

The Stokes Technologies division now employs ten staff, has assembled a comprehensive range of products and with recent significant contract wins and a pipeline of projects underway this division is shaping as a future growth engine of Stokes.”

2140438_034.doc

Offer Summary

Type of Offer	Type of Offer	Type of Offer	Non renounceable rights issue	Non renounceable rights issue	Non renounceable rights issue	Non renounceable rights issue	Non renounceable rights issue	Non renounceable rights issue	Non renounceable rights issue	Non renounceable rights issue	Non renounceable rights issue	Non renounceable rights issue
Is	ue Ratio		1 Co	nvertible N	ote for ev	ry 4 Shares h	ld
Is	sue Price		$03	5 per Conv	ertible Not	e
			.
KeCo	y terms o	f	Inte	rest paym	ent: 10%	p.a fixed coup	on paya	ble quarterly in
	tibl	Nt				30 J	30 S	b 31
	nvere	oes			arre	rs on une,	ep	emer,
					Dece	mber and 31	arch ea	ch year.
					Com	mencing 30 Se	ptembe	r 2014.
			Mat	urity:	30 J	une 2017 (unle	ss conv	erted earlier by
					the h	older)
			Con	vertibility:	Conv	ertible into ord	inary sh	ares at the
					di	ti f th hl	d	h Itt
					scr	eon o e o	er on	ac neres
					Paym	ent Date. Co	nversion	is on a 1:1
					basis	(subject to ad	justmen	t for certain
					dilti	d th	itl	tti
					u	nary an o	r capa	ransacons).
					In ad	dition uon co	nversio	the
						, p		,
					Com	pany will issue	1 $0.35	2019 option
					for e	very 2 Shares i	ssued.
			Ran	king:	Unse	cured and ran	king equ	ally with other
					unse	cured creditor	but ah	ad of
					shar	eholders
			Liqu	idity:	Conv	ertible Notes w	ill be lis	ted on ASX.
Record Date
			Monday 2 June 2014
New ConvertibleNotes issued			Approximately 7,287,820 convertible notes are to be issued(subject to rounding)
Funds Raised			Approximately $2.55M before costs
Underwriter			JM Financial Group Ltd ACN 007 364 132

Shareholder Approval of the Rights Issue is not required. The Rights Issue is being made pursuant to a Prospectus which will be lodged with ASIC today.

The Company will despatch the Prospectus to Eligible Shareholders on or about 5 June 2014 setting out the terms of the Rights Issue together with a personalised Entitlement and Acceptance Form, with instructions on how Eligible Shareholders may accept their entitlement.

The Directors, Messrs. Con Scrinis, Greg Jinks and Peter Jinks have advised that they will all take up their respective full entitlements under the Rights Issue in respect of all shares held by them (directly and indirectly).

2140438_034.doc

==> picture [579 x 122] intentionally omitted <==

EVENT	DATE
Announcement of Rights Issue and lodgement of	26 May 2014
Prospectus and Appendix 3B
Notice sent to Eligible Shareholders containing	28 May 2014
information required by Appendix 3B
“Ex” Date	29 May 2014
Record Date to determine Entitlements under the	2 June 2014
Offer
Rights Issue Opening Date	3 June 2014
Prospectus and Entitlement and Acceptance	5 June 2014
Forms Despatched to Eligible Shareholders
Final date and time for receipt of acceptance	17 June 2014
and payment in full (Closing Date)*	5:00pm
Securities quoted on a deferred settlement basis	18 June 2014
Notification to ASX of under subscriptions	19 June 2014
Issue Date	23 June 2014
Convertible Notes expected to commence trading	24 June 2014
on normal settlement basis*

These dates are subject to change and are indicative only. Stokes Limited reserves the right to amend this time table including, subject to the Corporations Act and listing rules, to extend the closing date. The Directors may extend the Closing date by giving at least 3 Business Days notice to ASX prior to the Closing Date. The date that the new shares are expected to commence trading on the ASX may vary with any change to the Closing date.

Con Scrinis Managing Director

2140438_034.doc