Dual ASX / NASDAQ Listing

The Australian incentive marketing program software specialist, Chip Application Technologies Limited, will today complete the restructuring to a new holding company incorporated in Delaware USA and will list shares in its new holding company, Catuity Inc. ("Catuity") on the Australian Stock Exchange (ASX). Catuity's shares, which will retain the ASX code CAT, will commence trading on the ASX on Tuesday 23 November 1999 and Chip Application Technologies will be delisted but will, via the scheme of arrangement, become a wholly owned subsidiary of Catuity. There are two features of the Catuity strategy that may provide an exciting precedent for other small Australian companies to follow: Firstly, Catuity plans to apply for a listing of its shares on Nasdaq, a process which it expects to complete early next year. This will give Catuity dual listing of its shares on ASX and Nasdaq, with the shares able to be freely traded by shareholders on either exchange. Secondly, Catuity will list its shares on Nasdaq, rather than the more commonly used American Depositary Receipts (ADRs). Having common shares on both exchanges is far more attractive to the Company and the North American investment community because experience there shows that small companies' ADRs result in limited liquidity and lack of analyst and investment community support. Although 95% of Catuity's shareholders are currently Australian, Catuity expects the number of North American shareholders to significantly increase as the centre of its business moves to the United States and the North American investment community is given the opportunity to buy and sell Catuity shares freely in the US market. In order to comply with Nasdaq's minimum share price requirement, Chip Application Technologies will undergo a 1-for-10 share consolidation as part of the scheme of arrangement. The price of Catuity shares when listed on Tuesday 23 November will reflect this change and will be more in line with the generally accepted price of shares on the Nasdaq exchange. Mr MacSmith, Chief Executive Officer and Managing Director of Chip Application Technologies, said the company's shift to dual listing of Catuity shares and the restructuring had been underway since January and will involve a cost of almost $3 million upon completion. "With the strong support of the ASX, we are carrying out a complex restructure with, we think, a unique strategy which will result in much greater liquidity and investor support. The complexity and cost of the restructure underlines the importance of the closer relationship being established between ASX and Nasdaq." The objective of the proposed ASX and Nasdaq co-listing facility is to enable companies to simultaneously raise capital on both ASX and Nasdaq markets in an efficient and streamlined manner. This would involve ASX accepting SEC listing documents, enabling a far easier and cheaper raising of capital in both markets.