Contents :

1. INTRODUCTION

Further to the announcements dated 22 August 2006, 23 May 2006, 13 April 2006 and 22 March 2006 on, amongst others, the subscription of shares by, Godynamic, a subsidiary of Nextnation, in Often Reach, and the collaboration between the Company, Jumpstart, Beijing Himo Tech Co. Ltd ("Beijing Himo") and Often Reach for the investment in research, development and the provision of mobile communication, wireless technologies, wireless value added services, Internet and related software and business ancillary thereto ("Subject Activities") in the People’s Republic of China ("PRC") ("Collaboration").

The Board of Directors ("Board") of Nextnation wishes to announce that Nextnation had on 9 July 2007, entered into a Share Transfer, Licensing and Termination Agreement between Often Reach, Godynamic, and Jumpstart to terminate the Collaboration due to certain long term business issues relating to Beijing Himo and Often Reach that could not be agreed upon in the short term.

2. DETAILS OF THE AGREEMENT

The details of the Agreement are as follows:

(a) Godynamic transferring 70,000 ordinary shares of USD0.01 in Often Reach ("Subject Shares") to Jumpstart ("Proposed Transfer");

(b) Often Reach granting Godynamic an exclusive licence to use the Emotion Spy (as defined herein) together with any and all of the trade marks, copyright, patents and other intellectual property rights used or subsisting in or in connection with the Emotion Spy including the software, hardware (if any) and other parts thereof (if any) ("Intellectual Properties") in the province of Fujian in PRC, and Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar, Philippines, Singapore, Thailand, Timor-Leste and Vietnam ("Territories") for a period of three (3) years from the date of completion ("Completion Date" or "Effective Date" as defined herein) in consideration of USD750,000 ; and

(c) Terminating the subscription agreement dated 23 May 2006 between Jumpstart and Often Reach ("Jumpstart Subscription Agreement"), the subscription agreement dated 23 May 2006 between Godynamic, Jumpstart and Often Reach (as announced on 23 May 2006) ("Godynamic Subscription Agreement") and the shareholders agreement dated 18 August 2006 between Godynamic, Jumpstart and Often Reach ("Shareholders’ Agreement"),

collectively referred to as the "Proposals".

2.1 Background of the Proposals

Godynamic is the registered owner of the Subject Shares, representing 70% of the entire issued and paid-up share capital of Often Reach, while Jumpstart is the register owner of 30,000 of USD0.01 shares in Often Reach ("Shares"), representing 30% of the entire issued and paid-up share capital of Often Reach. Neither Jumpstart nor Godynamic have subscribed to any preference share in Often Reach.

The original cost of investment of Godynamic in Often Reach was USD21,160 .In addition, Godynamic had paid a deposit of USD350,000 ("Deposit") to Often Reach pursuant to the Subscription Agreement and an advance of USD 350,000 ("Advance") was also made to Often Reach on 24 January 2007.

2.2 Salient terms and conditions of the Agreement

As extracted from the Agreement, the salient terms and conditions are, inter-alia, as follows:

(i) Share Transfer

(a) Upon the terms and subject to the conditions of this Agreement and in consideration of the mutual covenants contained herein, Godynamic hereby agrees to transfer to Jumpstart, and Jumpstart hereby agrees to accept the transfer from Godynamic the Subject Shares together with all rights attached thereto including all dividends and distributions declared, paid or made in respect thereof on or after the date of this Agreement.

(b) The completion of the transfer of the Subject Shares shall take place at such place agreed by the parties hereto ("Completion") within two (2) weeks from the date of this Agreement or such other date(s) as the parties hereto may mutually agree in writing (the "Completion Date" or "Effective Date").

(ii) Licensing of Emotion Spy

(a) Subject to the terms of this Agreement and in consideration of the Deposit and the Advance that have been paid to Often Reach, the receipt whereof Often Reach hereby expressly acknowledges, Often Reach hereby agrees to grant and Godynamic hereby agrees to accept an exclusive licence to use the Emotion Spy together with all or any of the Intellectual Properties for business operation purposes or otherwise in the Territories for a period of three (3) years from the Effective Date. For the avoidance of doubt, it is understood that the licence shall include, without limitation, the right to make, develop, use, distribute, sell, offer to sell products that incorporate, embody or are based on the Emotion Spy together with all or any of the Intellectual Properties.

(b) Godynamic shall be entitled to grant sub-licences of its rights under this Agreement to all or any of the affiliates of Godynamic.

(c) Often Reach hereby represents and warrants that it has full legal and beneficial ownership, rights, title and interest to the Emotion Spy together with all or any of the Intellectual Properties.

(d) Godynamic confirms that it does not own any right, title or interest in connection with the Emotion Spy together with all or any of the Intellectual Properties other than those granted under this Agreement.

(e) Often Reach is not aware that any third party owns or claims that it owns rights which would be infringed by use of the licence granted under this Agreement.

(f) In further consideration of the mutual covenants herein and without prejudice to the generality of the foregoing, in the event Godynamic’s or its affiliate(s)’ plans to carry out business activities with Often Reach and/or its nominee(s) in the province of Fujian in PRC, Godynamic or its affiliate(s) shall enter into further agreement with Often Reach and/or its nominee(s).

(iii) Termination and release

(a) The parties hereto hereby agree to terminate the following agreements and any and all rights, obligations and duties created thereunder with effect from the Effective Date:-

· the Jumpstart Subscription Agreement;
· the Godynamic Subscription Agreement; and
· the Shareholders’ Agreement.

(b) The parties hereto agree that with effect from the Effective Date, the parties hereto have been or shall be deemed to have been released, discharged, fulfilled and/or extinguished all their respective rights, duties, liabilities and obligations under the Jumpstart Subscription Agreement, the Godynamic Subscription Agreement and the Shareholders’ Agreement and each of the parties hereto shall forever release and discharge the other parties and their servants, agents, employees, officers, directors and shareholders and all others, of and from any and all claims, demands, actions and proceedings of every kind and nature, known and unknown, suspected and unsuspected, disclosed and undisclosed and in particular of and from all claims and demands of every kind and nature, known and unknown, suspected and unsuspected, disclosed and undisclosed, for damages actual and consequential, past, present and future, arising out of or in any way connected with the Jumpstart Subscription Agreement, the Godynamic Subscription Agreement and/or the Shareholders’ Agreement.

(c) Upon Completion, Often Reach and Jumpstart hereby jointly and severally agree and undertake to keep Godynamic harmless and completely indemnified against all (past, present or future) actions, proceedings, accounts, claims, dues, damages, costs, losses, expenses and demands relating to or connected with the Jumpstart Subscription Agreement, the Godynamic Subscription Agreement and/or the Shareholders’ Agreement.

2.3 Basis of arriving at the consideration

The Proposed Transfer, which forms an integral part of the Proposals, together with the deposit and advance paid of USD750,000 to Often Reach, are the considerations which mutually agreed by the parties in the agreement, for the granting to Godynamic an exclusive licence to use the Emotion Spy and termination of the relevant agreements as mentioned in Section 2 above.

Emotion Spy is an Interactive Voice Response platform developed by Beijing Himo and Institute of Automation, Chinese Academy of Sciences . It detects human emotion via capturing the conversation between the callers, and by applying advance algorithm such as neural network, it analyzes and categorizes the conversation into different group of emotions (Such as neutral, anger, fear, happiness, etc) with high level of accuracy.

Some of the application includes call centers application tool, where customer relation center can be operated more effectively through gaining better understanding of in-coming customers’ emotion before answering. In addition, it can be applied as an entertainment tool, where caller or recipient can "analyze" the emotion of each others during a tele-conversation.

2.4 Assumption of liabilities

Jumpstart will not be assuming any liabilities of Often Reach other than those incurred by Often Reach in the ordinary course of business.

3. INFORMATION ON GODYNAMIC

Godynamic was incorporated in the British Virgin Islands and is principally an investment holding company for some of the overseas operations of Nextnation group of companies ("Nextnation Group").

4. INFORMATION ON BEIJING HIMO, JUMPSTART AND OFTEN REACH

Please refer to the announcement dated 13 April 2006 for the background information on Beijing Himo, Jumpstart and Often Reach.

Based on the consolidated financial statements of Often Reach as at 30 April 2007, it recorded a net loss of RM135,221 and a deficit in shareholders’ funds of RM107,066.

5. RATIONALE

The Proposals will enable Godynamic to penetrate the high-growth mobile communication, wireless technologies, wireless value-added services market and related industry starting in PRC and followed by other countries within Asia Pacific.

6. RISK FACTORS

The operations of the license granting as mentioned in the agreement are subject to various risk factors inherent in the telecommunications industry, in particular the wireless value-added services market in the PRC and other countries within Asia Pacific. These include but are not limited to factors such economic and industry conditions, competition with other service providers, changes in government legislation and policies including the regulatory and licensing environment.
To mitigate some of the risk factors as set out above, Nexnation Group will constantly monitor the development of the industry and develop products and services that are in line with the technology and market trends and in compliance with government policies and requirements.

7. EFFECTS OF THE PROPOSALS

7.1 Share Capital and Substantial Shareholders’ Shareholdings

The Proposals will not have any effect on the issued and paid-up share capital of Nextnation and its substantial shareholders’ shareholdings.

7.2 Earnings, Net Assets and Gearing

The Proposed Transfer is expected to result in a loss of approximately USD60,000 while the Deposit and Advance paid to Often Reach of USD750,000, will be capitalised as research and development expenditure which will be amortised over the tenure of licence i.e. three (3) years from the Effective Date.

Other than the effects above, the Proposals are not expected to have any material effects on the earnings, net assets and gearing ratio of the Nextnation Group for the financial year ending 30 April 2008.

8. APPROVALS REQUIRED

The Proposals do not require the approval of the shareholders of Nextnation or any relevant authorities in Malaysia.

9. DEPARTURE FROM THE GUIDELINES OF THE SECURITIES COMMISSION ("SC")

To the best knowledge of the Board, the Proposals do not depart from the SC’s Guidelines for the MESDAQ Market.

10. DIRECTORS’, MAJOR SHAREHOLDERS’ AND CONNECTED PERSON’S INTERESTS

None of the Directors or major shareholders or persons connected to the Directors and/or major shareholders has any interest, direct or indirect, in the Proposals.

11. ESTIMATED TIMEFRAME FOR THE COMPLETION OF THE PROPOSALS

Barring any unforeseen circumstances, the Proposals are expected to be completed by the first quarter of the financial year ending 30 April 2008.

12. STATEMENT BY THE BOARD

The Board is of the opinion that the Proposals are in the best interest of Nextnation.

13. DOCUMENT FOR INSPECTION

The Agreement dated 9 July 2007, is available for inspection at the registered office of Nextnation at Level 7, Menara Milenium, Jalan Damanlela, Pusat Bandar Damansara, Damansara Heights, 50490 Kuala Lumpur during normal business hours from Mondays to Fridays (except public holidays) for a period of three (3) months from the date of this announcement.

This announcement is dated 9 July 2007.