Independent Adviser(s): PricewaterhouseCoopers (Rule 18)

Company Meeting Date: 01/12/2014

Summary of transaction

In April 2014, the shareholders of Lignotech Developments Limited (“Lignotech”) approved resolutions for the allotment of shares to KAAPA Investments LLC (“KAAPA”) to fund the construction of a United States based research and production facility.

For a number of reasons, the allotments did not go ahead. The Board restructured the allotments and proposed to seek shareholder approval again at a shareholders meeting on 1 December 2014. Under the new plan, Lignotech sought to raise US$7.2 million for the purpose of constructing an initial facility in Nebraska to produce sample Xylemer products and then to upgrade that facility later if Lignotech was satisfied that it was likely to receive commercial orders for the product.

Up to a total of 1,570,096 ordinary shares were being offered to the KAAPA related entities at US$2.95 per share (Tranche 1) and US$4.18 per share (Tranche 2).

At the meeting, Lignotech shareholders were asked to approve resolutions in respect of the increase in the voting control of the KAAPA related entities, resulting from the restructured allotments. The maximum percentage of voting securities that could be held or controlled by the KAAPA related entities was 30.94%.