CONNECTED MINERALS LIMITED — Capital/Financing Update 2019

Dec 17, 2019

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18 December 2019

ASX Announcement / Media Release

CIO RAISES $1.25M TO FULFIL SIGNIFICANT 2020 PURCHASE ORDERS

Connected IO Limited (“ CIO ” or “ Company ”) is pleased to announce that it has received firm commitments to raise $1.25 million through a placement to sophisticated and professional investors (“ Placement ”).

The proceeds of the Placement will be used to manufacture product to directly fulfil a significant number of purchase orders recently placed with CIO and general working capital.

The Placement will raise up to $1.25 million (before costs) through the issue of 416,666,667 Shares at an issue price of $0.003 per share.

The Placement will be within the Company’s capacity under ASX Listing Rules 7.1 and 7.1A, and accordingly, no shareholder approval is required. The Company will issue 234,238,634 Shares under Listing Rule 7.1 and 182,428,033 Shares under Listing Rule 7.1A. It is anticipated that the Placement Shares will be issued on 20 December 2019.

The completion of the Placement completes a very successful year for the Company which has seen significant revenue growth compared to previous years and primes the Company to accept greater purchaser orders and increase manufacturing output to record levels.

During 2019 CIO’s portfolio of products has evolved from pure hardware into a unique hardware/software platform that enables customers and partners to create and customize Internet of Things (IOT) solutions for their target markets.

Connected IO Limited ABN: 99 009 076 233 Level 24, 44 St Georges Tce, Perth WA 6000 T +61 8 6211 5099; F +61 8 9218 8875

“2019 has been a terrific year for Connected IO as we were able to overhaul our product portfolio to become more competitive, capture new markets and nearly double the revenues. We are pleased the business has been able to mitigate R&D risks and is now solely focused on growing and replicating its proven business model” said Yakov Temov CEO of Connected IO Limited.

The Board also confirms that the terms of the Line of Credit (LOC) with Tyche Investments Pty Ltd (as announced 21 November 2019) have been amended, with Tyche agreeing that the requirement for the Company to repay the facility in full in the event of an equity raising is to be waived in relation to the current Placement. No funds raised under this Placement will be used to repay the LOC facility. All remaining terms of the LOC remain unchanged.

Placement broker fees totalling 6% on funds raised will be payable via the issue of 20 million shares at a deemed issue price of $0.003 to be issued to 708 Capital Pty Ltd subject to shareholder approval, with the balance of $15,000 in cash.

An Appendix 3B for the proposed issue of the Placement Shares is attached.

ABOUT CONNECTED IO

Connected IO Limited has its operations based in Dallas, in the USA. Its business is a wireless technology innovator and manufacturer operating in the multi-trillion-dollar “IOT” (Internet of Things) sector. CIO specializes in machine to machine (“M2M”) connectivity, providing hardware and software solutions to some of the world’s largest companies. CIO’s software solutions also include a customised cloud management interface and a variety of support services. Cisco predicts there will be 50 billion connected devices by 2020.

For further information regarding this announcement please contact Adam Sierakowski, Chairman of Connected IO Limited on 08 6211 5099.

This announcement was approved and authorised for release by the Company’s Board of Directors.

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Connected IO Limited ABN: 99 009 076 233 Level 24, 44 St Georges Tce, Perth WA 6000 T +61 8 6211 5099; F +61 8 9218 8875

Rule 2.7, 3.10.3, 3.10.4, 3.10.5

Appendix 3B

New issue announcement, application for quotation of additional securities and agreement

Information or documents not available now must be given to ASX as soon as available. Information and documents given to ASX become ASX’s property and may be made public.

Introduced 01/07/96 Origin: Appendix 5 Amended 01/07/98, 01/09/99, 01/07/00, 30/09/01, 11/03/02, 01/01/03, 24/10/05, 01/08/12, 04/03/13

Name of entity

CONNECTED IO LIMITED

ABN

99 009 076 233

We (the entity) give ASX the following information.

Part 1 - All issues

You must complete the relevant sections (attach sheets if there is not enough space).

1 +Class of+securities issued or to be issued 2 Number of+securities issued or to be issued (if known) or maximum number which may be issued 3 Principal terms of the+securities (e.g. if options, exercise price and expiry date; if partly paid +securities, the amount outstanding and due dates for payment; if +convertible securities, the conversion price and dates for conversion)	Ordinary fully paid shares
	416,666,667 Shares to be issued pursuant to the Placement
	416,666,667 Ordinary Fully Paid Shares to be issued pursuant to the Placement.

• See chapter 19 for defined terms.

04/03/2013

Appendix 3B Page 1

4 Do the+securities rank equally in all respects from the+issue date with an existing+class of quoted+securities? If the additional+securities do not rank equally, please state: • the date from which they do • the extent to which they participate for the next dividend, (in the case of a trust, distribution) or interest payment • the extent to which they do not rank equally, other than in relation to the next dividend, distribution or interest payment 5 Issue price or consideration 6 Purpose of the issue (If issued as consideration for the acquisition of assets, clearly identify those assets) 6a Is the entity an+eligible entity that has obtained security holder approval under rule 7.1A? If Yes, complete sections 6b – 6h in relation to the+securities the subject of this Appendix 3B, and comply with section 6i 6b The date the security holder resolution under rule 7.1A was passed 6c Number of+securities issued without security holder approval under rule 7.1 6d Number of+securities issued with security holder approval under rule 7.1A	Shares – Yes
	416,666,667 Shares to be issued pursuant to the Placement at $0.003 per share.
	416,666,667 Shares to be issued pursuant to the Placement raising $1.25 million (before costs) with funds raised to be used to manufacture product to fulfil purchase orders and general working capital.
	Yes
	27 November 2019
	234,238,634 Placement Shares to be issued
	182,428,033 Placement Shares to be issued

6e Number of[+] securities issued Nil with security holder approval under rule 7.3, or another specific security holder approval (specify date of meeting) 6f Number of[+] securities issued Nil under an exception in rule 7.2 6g If[+] securities issued under rule Proposed issue of Placement Shares at an 7.1A, was issue price at least issue price $0.003. 75% of 15 day VWAP as VWAP $0.00381 (75% of VWAP being $0.0029) calculated under rule 7.1A.3? 15 day VWAP calculated up to and including 11 Include the[+] issue date and both December 2019, immediately preceding values. Include the source of the agreement to issue, with data sourced from VWAP calculation. IRESS. 6h If[+] securities were issued under Not applicable rule 7.1A for non-cash consideration, state date on which valuation of consideration was released to ASX Market Announcements 6i Calculate the entity’s remaining Listing Rule 7.1 – 236,797,656 issue capacity under rule 7.1 and Listing Rule 7.1A – 182,428,033 rule 7.1A – complete Annexure 1 and release to ASX Market Announcements 7 +Issue dates It is anticipated the Placement Shares will be issued on 20 December 2019 Note: The issue date may be prescribed by ASX (refer to the definition of issue date in rule 19.12). For example, the issue date for a pro rata entitlement issue must comply with the applicable timetable in Appendix 7A. Cross reference: item 33 of Appendix 3B. Number +Class 8 Number and +class of all 2,241,146,724 Fully paid ordinary +securities quoted on ASX shares ( including the +securities in section 2 if applicable)

• See chapter 19 for defined terms.

04/03/2013

Appendix 3B Page 3

9 Number and +class of all +securities not quoted on ASX (including the +securities in section 2 if applicable)	Number	+Class
	100,000,000 50,000,000 75,000,000 23	Class A Performance Shares which will convert into Ordinary Shares on a 1:1 basis on achievement of milestone. Class B Performance Shares which will convert into Ordinary Shares on a 1:1 basis on achievement of milestone. Unlisted Options (exercisable at $0.01; expiring 20 December 2020). Convertible Notes with a face value of $1,321,000 (convertible on the basis of $0.003 per share).

10 Dividend policy (in the case of a Not applicable trust, distribution policy) on the increased capital (interests)

Part 2 - Pro rata issue

11 Is security holder approval Not applicable required? 12 Is the issue renounceable or nonNot applicable renounceable? 13 Ratio in which the[+] securities will Not applicable be offered 14 +Class of +securities to which the Not applicable offer relates 15 +Record date to determine Not applicable entitlements 16 Will holdings on different Not applicable registers (or subregisters) be aggregated for calculating entitlements? 17 Policy for deciding entitlements Not applicable in relation to fractions

18 Names of countries in which the entity has security holders who will not be sent new offer documents Note: Security holders must be told how their entitlements are to be dealt with. Cross reference: rule 7.7. 19 Closing date for receipt of acceptances or renunciations 20 Names of any underwriters 21 Amount of any underwriting fee or commission 22 Names of any brokers to the issue 23 Fee or commission payable to the broker to the issue 24 Amount of any handling fee payable to brokers who lodge acceptances or renunciations on behalf of security holders 25 If the issue is contingent on security holders’ approval, the date of the meeting 26 Date entitlement and acceptance form and offer documents will be sent to persons entitled 27 If the entity has issued options, and the terms entitle option holders to participate on exercise, the date on which notices will be sent to option holders 28 Date rights trading will begin (if applicable) 29 Date rights trading will end (if applicable) 30 How do security holders sell their entitlements_in full_through a broker? 31 How do security holders sell_part_	Not applicable
	Not applicable
	Not applicable
	Not applicable
	Not applicable
	Not applicable
	Not applicable
	Not applicable
	Not applicable
	Not applicable
	Not applicable
	Not applicable
	Not applicable
	Not applicable

• See chapter 19 for defined terms.

04/03/2013

Appendix 3B Page 5

of their entitlements through a broker and accept for the balance?

32 How do security holders dispose Not applicable of their entitlements (except by sale through a broker)? 33 +Issue date Not applicable

Part 3 - Quotation of securities

You need only complete this section if you are applying for quotation of securities

• 34 Type of[+] securities ( tick one )

• (a) +Securities described in Part 1.

• (b)[All other ][+][securities ]

Example: restricted securities at the end of the escrowed period, partly paid securities that become fully paid, employee incentive share securities when restriction ends, securities issued on expiry or conversion of convertible securities

Entities that have ticked box 34(a)

Additional securities forming a new class of securities

Tick to indicate you are providing the information or documents

35		If the+securities are+equity securities, the names of the 20 largest holders of the additional+securities, and the number and percentage of additional+securities
		held by those holders
36		If the+securities are+equity securities, a distribution schedule of the additional +securities setting out the number of holders in the categories
		1 - 1,000
		1,001 - 5,000
		5,001 - 10,000
		10,001 - 100,000
		100,001 and over
37		A copy of any trust deed for the additional+securities

Entities that have ticked box 34(b)

38	Number of+securities for which
	+quotation is sought
39	+Class of+securities for which
	quotation is sought
40	Do the+securities rank equally in
	all respects from the+issue date
	with an existing+class of quoted
	+securities?
	If the additional+securities do not
	rank equally, please state:
	• the date from which they do
	• the extent to which they
	participate for the next
	dividend, (in the case of a trust,
	distribution) or interest
	payment
	• the extent to which they do not
	rank equally, other than in
	relation to the next dividend,
	distribution or interest
	payment
41	Reason for request for quotation
	now
	Example: In the case of restricted securities, end
	of restriction period
	(if issued upon conversion of
	another+security, clearly identify
	that other+security)

Number +Class 42 Number and +class of all +securities quoted on ASX ( including the[+] securities in clause 38)

• See chapter 19 for defined terms.

04/03/2013

Appendix 3B Page 7

Quotation agreement

• 1 +Quotation of our additional +securities is in ASX’s absolute discretion. ASX may quote the[+] securities on any conditions it decides.

• 2 We warrant the following to ASX.

• The issue of the[+] securities to be quoted complies with the law and is not for an illegal purpose.

• There is no reason why those[+] securities should not be granted +quotation.

• An offer of the[+] securities for sale within 12 months after their issue will not require disclosure under section 707(3) or section 1012C(6) of the Corporations Act.

Note: An entity may need to obtain appropriate warranties from subscribers for the securities in order to be able to give this warranty

• Section 724 or section 1016E of the Corporations Act does not apply to any applications received by us in relation to any[+] securities to be quoted and that no-one has any right to return any[+] securities to be quoted under sections 737, 738 or 1016F of the Corporations Act at the time that we request that the[+] securities be quoted.

• If we are a trust, we warrant that no person has the right to return the +securities to be quoted under section 1019B of the Corporations Act at the time that we request that the[+] securities be quoted.

• 3 We will indemnify ASX to the fullest extent permitted by law in respect of any claim, action or expense arising from or connected with any breach of the warranties in this agreement.

• 4 We give ASX the information and documents required by this form. If any information or document is not available now, we will give it to ASX before +quotation of the +securities begins. We acknowledge that ASX is relying on the information and documents. We warrant that they are (will be) true and complete.

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Sign here: ............................................................Date: 18 December 2019 (Company secretary)

Print name: Nicki Farley

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Appendix 3B – Annexure 1

Calculation of placement capacity under rule 7.1 and rule 7.1A for eligible entities

Introduced 01/08/12 Amended 04/03/13

Part 1

Rule 7.1 – Issues exceeding 15% of capital

Step 1: Calculate “A”, the base figure from which the placement capacity is calculated

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Insert number of fully paid [+] ordinary 1,731,436,053
securities on issue 12 months before the
+ issue date or date of agreement to issue
Add the following: 43,315,673 – Placement and Underwriting
Fee Shares
• Number of fully paid [+] ordinary securities
issued in that 12 month period under an 5,000,000 – Loan Agreement Shares
exception in rule 7.2
33,333,333 – Director Fee Shares
• Number of fully paid [+] ordinary securities
issued in that 12 month period with 11,195,272 – Shares issued on conversion
shareholder approval of Notes and interest
• Number of partly paid [+] ordinary
securities that became fully paid in that
12 month period
Note:
• Include only ordinary securities here –
other classes of equity securities cannot
be added
• Include here (if applicable) the securities
the subject of the Appendix 3B to which
this form is annexed
• It may be useful to set out issues of
securities on different dates as separate
line items
Subtract the number of fully paid [+] ordinary 0
securities cancelled during that 12 month
period
“A” 1,824,280,331
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• See chapter 19 for defined terms.

04/03/2013

Appendix 3B Page 9

Step 2: Calculate 15% of “A”

Step 2: Calculate 15% of “A”
“B”	0.15
	[Note: this value cannot be changed]
Multiply“A” by 0.15	273,642,049
Step 3: Calculate “C”, the amount of placement capacity under rule 7.1
that has already been used
Insertnumber of+equity securities issued	199,726 – Shares issued for convertible
or agreed to be issued in that 12 month	note interest
period_not counting_those issued:
	36,644,667 – Potential future share issue for
• Under an exception in rule 7.2	Line of Credit Interest (payable in cash or
	shares at the election of the Lender)
• Under rule 7.1A
• With security holder approval under rule
7.1 or rule 7.4
Note:
• This applies to equity securities, unless
specifically excluded – not just ordinary
securities
• Include here (if applicable) the securities
the subject of the Appendix 3B to which
this form is annexed
• It may be useful to set out issues of
securities on different dates as separate
line items

Step 2: Calculate 15% of “A”	Step 2: Calculate 15% of “A”
“B”	0.15 [Note: this value cannot be changed]
Multiply“A” by 0.15	273,642,049
Step 3: Calculate “C”, the amount of placement capacity under rule 7.1 that has already been used
Insertnumber of+equity securities issued or agreed to be issued in that 12 month period_not counting_those issued: • Under an exception in rule 7.2 • Under rule 7.1A • With security holder approval under rule 7.1 or rule 7.4 Note: • This applies to equity securities, unless specifically excluded – not just ordinary securities • Include here (if applicable) the securities the subject of the Appendix 3B to which this form is annexed • It may be useful to set out issues of securities on different dates as separate line items	199,726 – Shares issued for convertible note interest 36,644,667 – Potential future share issue for Line of Credit Interest (payable in cash or shares at the election of the Lender)
“C”	36,844,393
Step 4: Subtract “C” from [“A” x “B”] to calculate remaining placement capacity under rule 7.1
“A” x 0.15 Note: number must be same as shown in Step 2	273,642,049
Subtract“C” Note: number must be same as shown in Step 3	36,844,393
Total[“A” x 0.15] – “C”	236,797,656 [Note: this is the remaining placement capacity under rule 7.1]

placement capacity under rule 7.1
“A” x 0.15	273,642,049
Note: number must be same as shown in
Step 2
Subtract“C”	36,844,393
Note: number must be same as shown in
Step 3
Total[“A” x 0.15] – “C”	236,797,656
	[Note: this is the remaining placement
	capacity under rule 7.1]

Part 2

Part 2	Part 2
Rule 7.1A – Additional placement capacity for eligible entities
Step 1: Calculate “A”, the base figure from which the placement capacity is calculated
“A” Note: number must be same as shown in Step 1 of Part 1	1,824,280,331
Step 2: Calculate 10% of “A”
“D”	0.10 Note: this value cannot be changed
Multiply“A” by 0.10	182,428,033
Step 3: Calculate “E”, the amount of placement capacity under rule 7.1A that has already been used
Insertnumber of+equity securities issued or agreed to be issued in that 12 month period under rule 7.1A Notes: • This applies to equity securities – not just ordinary securities • Include here – if applicable – the securities the subject of the Appendix 3B to which this form is annexed • Do not include equity securities issued under rule 7.1 (they must be dealt with in Part 1), or for which specific security holder approval has been obtained • It may be useful to set out issues of securities on different dates as separate line items	-
“E”	-

• See chapter 19 for defined terms.

04/03/2013

Appendix 3B Page 11

Step 4: Subtract “E” from [“A” x “D”] to calculate remaining placement capacity under rule 7.1A

Step 4: Subtract “E” from [“A” x “D”] to calculate remaining placement capacity under rule 7.1A	Step 4: Subtract “E” from [“A” x “D”] to calculate remaining placement capacity under rule 7.1A
“A” x 0.10 Note: number must be same as shown in Step 2	182,428,033
Subtract“E” Note: number must be same as shown in Step 3	-
Total[“A” x 0.10] – “E”	182,428,033 Note: this is the remaining placement capacity under rule 7.1A