KNIGHTS INSOLVENCY ADMINISTRATION LIMITED (ASX.KIA)

name changed to Reco Financial Services Ltd

we understand it will be a month or so before the company is re-quoted on ASX as there are accounts to be prepared and other matters to attend to - the name is to be changed to Reco Financial Services Ltd - it will take effect from Friday, 30 June 2006 - the ASX code for the Company effective, 30 June 2006 will be "REO"

applies for the quotation of 39,000,000 unlisted December 2008 options, exercisable at $0.10 cents each

applies for the quotation of an additional 98m fully paid ordinary shares

company advises that all of the resolutions considered at the General Meeting of shareholders held on 14 June 2006 were passed on a show of hands

we understand that on or about this date the company consolidated its shares 1 for 5

provides Notice of a General Meeting to be held at Nicols and Brien, Level 2, 350 Kent Street, Sydney, New South Wales on 14 June 2006 at 11am - deed administrators have accepted a proposal by Winning Corporate Services Pty Ltd (on behalf of an investment group) for the restructuring and recapitalisation of the Company, including the settlement of all creditor claims - the proposal is for the shares to be consolidated on a 1 for 5 basis and further shares to be issued to raise approx $2m - if the proposal proceeds the new company will eventually seek the reinstatement to quotation of its shares

the reconstruction of the company is proceeding with the shareholders meeting scheduled for Sydney on 14th June - the notice of meeting has evidently been distributed by the promoter

ASIC has acted to cancel former director Trevor Schmierer's registration as a liquidator - he will no longer be able to practice as a registered liquidator

we understand the administrators have accepted on offer for the listed shell of knights and are "in the process of finalising same" - typically that involves, among other things, calling a shareholders' meeting to consider recapitalisation proposals

the administrators are looking to sell the company shell - expressions of interest should be made to Kristen Lucas, SimsPartners, Ph:(02)9241 3422 Fax:(02) 9241 3922 KLucas@simspartners.com.au - expressions of interest close on 7 November 2005

the convening period for the second meeting of creditors has been extended to 11 November 2005 - the future of the company will be determined at that meeting by the creditors

Pierpont writing in the AFR winds up with a big-picture summary "Knights's listed life was a little over two years. In that time, the billings it collected totalled $19 million, but it spent $29 million on operations. The $10 million gap was funded by the capital it raised in the float and the September 2004 placement." he goes on to say "the number of accountancy groups to list in Australia in recent years now totals three (Harts, Stockford and Knights) and the number that have hit the wall after an exceedingly short listed life also totals three. Wild horses couldn't drag Pierpont into the next one."

secured creditor ANZ Bank appoints T Sims and G Sparks of Sims Partners as Administrators - among the reasons given was the departure of former executive director Adrian Duncan along with work in progress of about $1.6m

company advises that recapitalisation discussions are continuing and that it should be able to make a further announcement on Monday morning

company advises that recapitalisation discussions are continuing and that it should be able to make a further announcement within 24 hours

company announces it is continuing its discussions with potential investors - these discussions are having a delaying effect on the company's dealings with the ANZ Bank and its continued support - the board expects to make an announcement to the market either later today or early tomorrow morning following the conclusion of those discussions

shares suspended from quotation because of a failure to pay annual listing fees