Document

Electro Optic Systems Holdings Limited

Annual General Meeting

27 May 2010

1. Company Overview

2. Review of 2009 operating result

3. Remote Weapon Systems Business

4. Space Business

Profitable with substantial cash and inventory

Acquisition of ROI completed

Teaming with NGC for $4 billion CROWS 3

Addressable market now exceeds $7 billion

Space surveillance re-positioned for tighter budgets

Australian space policy providing growth options

Company Overview

Strong progress towards strategic objectives.

A platform for growth has been established.

Review of 2009 Performance

Strategic positioning is in hand and revenue growth can now

be addressed with a stronger product line and partners.

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2007 2008 2009

$A

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Annual Revenue

Review of 2009 Performance

Profit achieved on $40m revenue while expensing all

technology development and product line expansion costs.

2006 2007

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(20)

(15)

(10)

(5)

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2007 2008 2009

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Profit/Loss

Remote Weapon Systems Developments:

Acquisition of ROI Inc.

Expansion of product line

CROWS teaming

New market development

ROI Acquisition

Recon Optical Inc. [ROI] was EOS’ partner for CROWS

from 1999 - 2007.

RWS business of ROI acquired in 2 stages:

– Stage1 December 2008: Physical assets acquired

– Stage 2 November 2009: RWS technology acquired

The acquisition brings to EOS all the technology

incorporated in the CROWS R-400 and R-200 products

that was not already owned by EOS.

EOS now owns all the technology for its entire product

line of remote weapon systems. This is unique to EOS.

R-600 Dual [300 kg]

R-400 [CROWS 1] [200 kg]

R-200 [100 kg]

EOS Remote Weapon Systems

EOS now has the most comprehensive product range in the industry

EOS Lightweight RWS

R-200

• Lightweight

• Low cost

• Fielded and qualified

• High performance

• Long range

• High powered weapons

• In production

• Excellent performance

record

US Army CROWS

[Common Remotely Operated Weapon System]

R-400 or US Army CROWS

R-400 in service with the Australian Army

R-600: Dual Weapon System

Dual weapons

Air burst 40mm

Video tracker

Built-in Test [BIT]

Video-Audio record

BMS port

In production

and fielding

R-600 is the world’s most advanced remote weapon system

CROWS 3

The US Army will procure up to 10,000 CROWS 3

weapon systems from 2011.

This procurement will be valued at up to US$4 billion

over 10 years.

EOS has proven products for this requirement.

EOS has teamed with Northrop Grumman for CROWS 3.

EOS will provide technology and products and about 50%

of deliverables.

Northrop Grumman will provide the production and parts

management technology, global product support,

program leadership including tender preparation and

about 50% of deliverables under license to EOS.

CROWS 3 Teaming

EOS is now placed in an extremely strong CROWS

team which can meet all Army requirements for

technology, quality, production and global support.

Defence White Paper:

Remote Weapon Systems

• Australia will acquire 1,100 deployable protected vehicles

& 7,000 support vehicles. Many will require weapon

systems

• “Remote weapon stations on combat vehicles” is a

priority industry capability for Australia

EOS is the only Australian provider of remote weapon

stations, and has proven technology and products

Australian remote weapon system requirements

provide growth potential over the next 5 years

Space Business

• Telescopes:

– Skymapper, Lick, MRO projects delivered

– GMT effort escalating with ANU

• Space Operations:

– GoA space tracking contract extended to 2013

• Space Surveillance

– Australian requirements approaching acquisition

– EOS capabilities adapting for new requirements

Magdalena Ridge Observatory

2.4m Telescope

• Installed 2008

• Delivering excellent

results for 2 years

• Completion Q3 2010

ANU Relationship

• EOS corporate offices & EOS space development moved to new

premises at Mt Stromlo, leased from ANU.

• EOS and ANU are executing teaming arrangements to pool

resources to develop advanced Adaptive Optics (AO).

• AO is a universal requirement for future large telescopes such as

GMT and in space surveillance.

Giant Magellan Telescope [GMT]

• 26m diameter telescope

(world’s largest).

• A$1bn international project

with A$88m Australian

participation through ANU

• Success depends on

“Adaptive Optics” technology

• EOS and ANU have strong

AO technology and will

jointly bid for GMT

requirements.

Australian Space Research Program

• ASRP is a $40M fund for space technology

• EOS funded in first round for improving satellite orbit prediction

• Candidates for further funding through EOS in 2010:

enhancements to EOS space surveillance capability to full operational

readiness; and

Space flight hardware for NASA Grace satellite follow-up mission

Space Surveillance: Current Conflict

Need for new space surveillance data is becoming more acute:

– Space debris grown 50% since Chinese ASAT test and Iridium/Cosmos crash

– Runaway pollution of entire orbital belts now possible

– Multi-year studies in USA and Europe underscore increased risk and inadequacy of current capabilities

Funding constraints are also becoming more acute:

– Euro sovereign debt crisis will have implications on public spending in the euro zone for several years

– US defence spending facing cuts

– NASA budget under increased pressure

A new approach is required to allow these conflicting pressures to

be reconciled and current operational problems to be addressed.

Space Surveillance: EOS Response

EOS response to unmet requirements and funding

issues:

– Mt Stromlo capability to be upgraded for 400%

productivity increase by 2012

– Adapt technology to fit both needs and funding, and

allow progressive deployment with strong risk

reduction

– Performance improvements and cost reduction allows

Australia itself to contribute to global space

surveillance efforts

Planned data yield improvements will allow more

affordable access to customers for risk reduction.

Space Activities in Australia

The Defence White Paper [2009] indicated requirements

for the following capabilities.

• Space Surveillance and Space Situation Awareness

• Theatre Defence

• Surveillance from Space using satellites

EOS has commenced the adaptation of its technology

and products to meet these needs as they are acquired

by Australia from 2011.

Profitable with substantial cash and inventory

Acquisition of ROI completed

Teaming with NGC for $4 billion CROWS 3

Addressable market now exceeds $7 billion

Space surveillance re-positioned for tighter budgets

Australian space policy providing growth options

Company Overview

Strong progress towards strategic objectives.

A platform for growth has been established.