CARBONXT GROUP LIMITED — Capital/Financing Update 2021

May 20, 2021

ASX RELEASE

21 May 2021

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CARBONXT launches a non-renounceable pro-rata entitlement Offer to raise up to $2.06m

Further to the announcement made on 5 May 2021 ( Previous Announcement ), Carbonxt Group Limited ( Carbonxt or the Company ) is pleased to announce that the Company has decided to launch a nonrenounceable pro-rata entitlement offer to existing shareholders ( Offer ) on the same terms as the placement, which was announced in the Previous Announcement.

The Offer is being made under a prospectus ( Prospectus ), which has been lodged with ASIC.

Key terms of the Offer

The Offer will provide eligible Carbonxt shareholders the opportunity to apply for one new fully paid ordinary share ( New Share ) for every 11 existing fully paid ordinary shares ( Shares ) held as at 7.00pm (Sydney time) on Wednesday, 26 May 2021 ( Record Date ), at an offer price of $0.15 per New Share ( Offer Price ), and the Company will issue one free attaching option with an exercise price of $0.24 exercisable on or before Wednesday, 21 June 2023, being 24 months from the issue date ( New Option ) for every two New Shares issued (together, the Entitlement ).

It is anticipated that up to 13,710,889 New Shares and 6,885,444 New Options may be issued pursuant to the Offer, which would raise approximately $2.06 million before expenses of the Offer.

The Offer is partially underwritten by Chaleyer Holdings Pty Ltd up to the value of $1 million.

The Company will use the proceeds raised under the Offer to:

• provide funding to the Company to support the development of activated carbon pellets; and

• provide working capital to the Company generally (including to fund the costs of the Offer).

The Offer price represents:

• a 15.4% premium to the last closing price of $0.130 on 20 May 2021;

• a 15.4% premium to the 10 trading day Volume Weighted Average Price (VWAP) up to and including 20 May 2021.

The Offer is open to Carbonxt shareholders with registered addresses in Australia and New Zealand as at the Record Date. Shareholders at the Record Date without a registered address outside Australia and New Zealand will not be eligible to participate in the Offer.

Existing holders of options and warrants will not be able to participate in the Offer unless they exercise their options and become a registered holder of Shares (upon exercising their options) prior to the Record Date.

The Offer will include a top-up facility that allows eligible shareholders to apply for additional New Securities in excess of their Entitlements, to the extent that there are sufficient amount of New Securities not taken up by other Eligible Shareholders.

The New Shares issued pursuant to the Offer will rank equally with the existing issued Shares of the Company and are expected to be quoted on the ASX. The Company will also seek official quotation of the New Options, subject to satisfying the quotation conditions of the ASX Listing Rules. If ASX does not grant official quotation

CarbonxtGroup Limited. Level 12, 225 George Street, Sydney NSW 2000 Legal/75648019_1

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of the New Options issued pursuant to the Prospectus before the expiration of 3 months after the date of issue of the Prospectus (or such period as varied by ASIC), the New Options will remain on issue as unquoted options of the Company.

More information regarding the Offer is set out in the Prospectus, which will be despatched to eligible shareholders in accordance with the timetable set out below.

The Prospectus will be accessible today from the ASX and Carbonxt' website, www.asx.com.au and www.carbonxt.com respectively.

Key Dates

ey Dates
Lodgement of Prospectus with ASIC and announcement of the Offer	Friday, 21 May 2021
Existing Shares quoted 'ex' rights	Tuesday, 25 May 2021
Record Date	7.00pm (Sydney time) on Wednesday, 26 May 2021
Opening Date	Friday, 28 May 2021
Despatch of the Prospectus and personalised entitlement and acceptance forms to eligible shareholders	Friday, 28 May 2021
Closing Date	5.00pm (Sydney time) on Wednesday, 16 June 2021
New Securities expected to be quoted on a deferred settlement basis	Thursday, 17 June 2021
ASX Announcement of results of the Offer	Friday, 18 June 2021
Allotment of New Securities pursuant to the Offer	Tuesday, 22 June 2021
New Securities allotted pursuant to the Offer expected to commence trading on ASX on a normal basis	Wednesday, 23 June 2021
Despatch of holding statements	Thursday, 24 Friday 2021

The above dates are subject to change and are indicative only. The Company reserves the right to vary the dates and times of the Offer, including to close the Offer early, extend the Offer or accept late applications, without notifying any recipient of this Prospectus or any applicants, subject to the Corporations Act 2001 (Cth), the ASX Listing Rules and other applicable laws.

This announcement has been authorised for release to ASX by the Board of Directors of Carbonxt Group Limited.

ENDS

For Investor Enquiries Warren Murphy Managing Director +61 413841216 w.murphy@carbonxt.com

CarbonxtGroup Limited. Level 12, 225 George Street, Sydney NSW 2000 Legal/75648019_1

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About Carbonxt

Carbonxt (ASX:CG1) is a cleantech company that develops and markets specialised Activated Carbon products, primarily focused on the capture of mercury and other contaminants in industrial processes that emit substantial amounts of harmful pollutants. The Company produces and manufactures Powdered Activated Carbon and Activated Carbon pellets for use in industrial air purification, waste water treatment and other liquid and gas phase markets.

CarbonxtGroup Limited. Level 12, 225 George Street, Sydney NSW 2000 Legal/75648019_1