4DS MEMORY LIMITED — Capital/Financing Update 2020

Jun 28, 2020

4DS Memory Limited | ABN 43 145 590 110 Level 2, 50 Kings Park Road, West Perth WA 6005 PO Box 271, West Perth WA 6872

+61 8 6377 8043 | david@4dsmemory.com | www.4dsmemory.com

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ASX RELEASE

29 June 2020

Successful $4.5 million Placement and Launch of SPP

4DS Memory Limited ( ASX:4DS ) ( 4DS or the Company ) is pleased to announce that it has received binding commitments from American and Australian institutional and high net worth investors which has raised $4.5 million (“Placement”). The Placement attracted strong interest in excess of the shares available to allocate. The Placement will be followed by a share purchase plan (“SPP”) of up to $2.5 million.

Highlights

• 4DS has successfully raised $4.5 million via a Placement of 100 million shares at $0.045 per share

• The Placement was to American and Australian institutional and high net worth investors and was managed by global advisory firm, Viriathus Capital

• SPP to raise up to $2.5 million will occur after the Placement, with shareholders offered the chance to acquire additional new shares on the same terms as the Placement

• Capital raised will be used to progress the development of 4DS’ Interface Switching ReRAM technology with imec and Western Digital/HGST

Managing Director and Chief Executive Officer Dr Guido Arnout, said

“We are extremely encouraged by the success of the Placement following on from our recent results that included input from Western Digital’s 100% subsidiary, HGST and of course from imec. 4DS has two world leading companies supporting our efforts to manufacture a megabit chip using imec memory platform. The current data were extremely significant and provides a magnificent platform on which to move forward during the balance of 2020.”

Chairman, Mr Jim Dorrian, said

“4DS shareholders should be very proud of the achievements made by our team. We have an outstanding and industry recognized team of engineers and material scientists who are at the cutting edge of Storage Class Memory development. We look forward to further developments as we move towards commercialization of the technology.”

Placement

4DS is pleased to advise that it has received binding commitments totaling $4.5 million from a number of institutional and high net worth investors in the USA and Australia. The Placement comprises the issue of 100 million ordinary shares in 4DS (“New Shares”), at an offer price of $0.045 per New Share, representing a discount of 15.1% to the closing price as at 22 June 2020 and 17.6% to the 15 day volume weighted average price (“VWAP”).

The Placement is within the Company’s placement capacity under ASX Listing Rule 7.1, and a timetable is provided at the end of this announcement.

Viriathus Capital acted as sole and lead manager for the Placement to investors in the USA and Australia.

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112294 (1588718)

4DS Memory Limited | ABN 43 145 590 110 Level 2, 50 Kings Park Road, West Perth WA 6005 PO Box 271, West Perth WA 6872

+61 8 6377 8043 | david@4dsmemory.com | www.4dsmemory.com

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Share Purchase Plan

A SPP will be conducted and eligible shareholders on the Company’s share register as at 5pm AEST on 26 June 2020 (“Record Date”) with a registered address in Australia and New Zealand can apply.

Eligible shareholders can acquire up to $15,000 of New Shares and the offer will seek to raise up to $2.5 million at $0.045 per share, being the same price as the Placement.

If 4DS receives applications for New Shares under the amount of $2.5 million the Company reserves the right to place the shortfall. In the event the Company receives applications for more than $2.5 million the Company reserves the right to scale back applications or accept oversubscriptions in its discretion.

All details will be confirmed in the SPP Booklet.

Use of Funds

The Company will use funds raised to continue the development of 4DS’ Interface Switching ReRAM, including acceleration of work being performed at imec and HGST, maintenance of granted patents and additional patent filings and general working capital purposes.

Managing Director Remuneration

Pursuant to Dr Arnout’s Executive Services Agreement with the Company, Dr Arnout’s remuneration is reviewed annually and at other times as the Board determines.

Dr Arnout and the Company will have discussions in the coming months regarding Dr Arnout’s remuneration including appropriate incentives having specific regard to the current stage of development of the Company’s technology.

At Dr Arnout’s request, the key attribute of any incentives is that they will be 100% success based and tied to the successful commercialisation of the Company’s technology; i.e. via a takeover of the Company, or a sale of the Company’s intellectual property. The Board is confident that a commercial outcome with respect to Dr Arnout’s reviewed remuneration will be able to be reached, which is acceptable to shareholders, the 4DS Board and Dr Arnout.

With respect to the provision of past services, Dr Arnout owns approximately 36.5m options with an exercise price of $0.02 and an expiry date of 30 June 2020 (“2020 Options”). Under US taxation laws, the 2020 Options are treated as “non-qualified stock options” and the exercise by Dr Arnout of some or all of the 2020 Options would trigger an immediate taxable event, payable within a week, and at an approximate tax rate (including State and Federal taxes) of 47%.

The funding of this tax, together with the funding of the exercise price, would necessitate Dr Arnout to sell down the majority of the resultant shares that would be issued upon exercise of the 2020 Options. Dr Arnout expressed his desire not to detract from the Company’s capital raising by selling into the Placement, or to place undue pressure on the capitalisation of the Company by selling down on market shortly after the Company has announced its best results since commencing work with imec and Western Digital (Refer to announcement on 24 June 2020). Dr Arnout therefore advised the Company (and incoming investors under the Placement) that he will not be exercising the 2020 Options.

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112294 (1588718)

4DS Memory Limited | ABN 43 145 590 110 Level 2, 50 Kings Park Road, West Perth WA 6005 PO Box 271, West Perth WA 6872

+61 8 6377 8043 | david@4dsmemory.com | www.4dsmemory.com

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Timetable

Timetable
Event	Date
Record date for Share Purchase Plan (SPP)	Friday, 26 June 2020
Despatch of SPP Booklet	Friday, 3 July 2020
Opening Date of SPP	Friday, 3 July 2020
Settlement of Placement	Friday, 3 July 2020
Allotment and Trading of Placement Shares	Monday, 6 July 2020
Closing Date of SPP	Friday, 24 July 2020*
Issue Date of SPP Shares	Wednesday, 30 July 2020

*Timetable is indicative and subject to change without notice and 4DS may at its discretion close the SPP early.

- ENDS -

Contact information

Investors: David McAuliffe 4DS Memory +61 408 994 313 david@4dsmemory.com

About 4DS

4DS Memory Limited (ASX: 4DS), with facilities located in Silicon Valley, is a semiconductor development company of non-volatile memory technology, pioneering Interface Switching ReRAM for next generation gigabyte storage in mobile and cloud. Established in 2007, 4DS owns a patented IP portfolio, comprising 23 USA patents granted and 9 patent applications pending and or filed, which has been developed in-house to create high-density Storage Class Memory. 4DS has a joint development agreement with Western Digital subsidiary HGST, a global storage leader, which accelerates the evolution of 4DS’ technology. 4DS also collaborates with imec, a world-leading research and innovation hub in nanoelectronics and digital technologies. The combination of imec’s widely acclaimed leadership in microchip technology and profound software and information and communication technology expertise makes them unique.

For more information, please visit www.4dsmemory.com.

Disclaimer

This release contains certain forward looking statements that are based on the Company’s management’s beliefs, assumptions and expectations and on information currently available to management. Such forward looking statements involve known and unknown risks, uncertainties, and other factors which may cause the actual results or performance of 4DS to be materially different from the results or performance expressed or implied by such forward looking statements. Such forward looking statements are based on numerous assumptions regarding the Company’s present and future business strategies and the political and economic environment in which 4DS will operate in the future, which are subject to change without notice. Past performance is not necessarily a guide to future performance and no representation or warranty is made as to the likelihood of achievement or reasonableness of any forward looking statements or other forecast. To the full extent permitted by law, 4DS and its directors, officers, employees, advisers, agents and intermediaries disclaim any obligation or undertaking to release any updates or revisions to information to reflect any change in any of the information contained in this release (including, but not limited to, any assumptions or expectations set out in the release).

You should not place undue reliance on these forward- looking statements. Except as required by law or regulation (including the ASX Listing Rules) we undertake no obligation to update these forward- looking statements.

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