DATAWORKS GROUP LIMITED — Capital/Financing Update 2019

Nov 4, 2019

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5 November 2019

Dear Shareholder

IXUP Limited (ASX: IXU) Notification to Eligible Shareholders of the Entitlement Offer

On 31 October 2019, IXUP Limited ACN 612 182 368 ( ASX: IXU ) ( Company ) announced a 2 for 5 (2 new fully paid ordinary shares ( Shares ) for every 5 existing Shares) fully underwritten non-renounceable pro rata entitlement offer pursuant to which the Company will raise up to approximately A$3,168,875 (before costs and expenses) ( Entitlement Offer ).

The Entitlement Offer is being made without a prospectus in accordance with section 708AA of the Corporations Act 2001 (Cth) (as modified by ASIC Corporations (Non-Traditional Rights Issues) Instrument 2016/84 ).

Under the terms of the Entitlement Offer, only shareholders of the Company with a registered address in Australia or New Zealand on or before 7.00 pm (AEDT) on Thursday, 7 November 2019 ( Record Date ) will be invited to participate in the Entitlement Offer ( Eligible Shareholders ). Eligible Shareholders will be invited to subscribe for two (2) new Shares in the Company for every five (5) Shares held by the shareholder at an issue price of A$0.05 (5 cents) per Share ( Entitlement ), representing a 25.4% discount to the closing price on the 28th October 2019.

The Company will lodge an offer booklet for the Entitlement Offer ( Offer Booklet ) with ASX on or before 8 November 2019. It is anticipated that the Offer Booklet and the accompanying personalised Entitlement and Acceptance Form will be mailed to Eligible Shareholders on or before 8 November 2019. The Offer Booklet may be viewed on the ASX’s website at www.asx.com.au (by searching for the Company’s ASX ticker code, IXU).

Further details of the Entitlement Offer

The Entitlement Offer is fully underwritten by Cygnet Capital Pty Limited ( Underwriter ).

The proceeds of the Entitlement Offer will be used by the Company to fund commercial roll out of the Company's encrypted data collaboration platform, sales and marketing in the US and Australia and general working capital.

As a result of the Entitlement Offer, the number of Shares in the Company is projected to increase from 158,443,751 Shares (which includes 50,000,001 Shares that are escrowed until 10 November 2019) to approximately 221,821,251 Shares (subject to rounding, and assuming the full amount is raised). The Shares issued under the Entitlement Offer will be fully paid and will rank equally with the Company’s other fully paid ordinary shares on issue. The Company has made an application to the ASX for official quotation of the total number of Shares that could be issued under the Entitlement Offer (i.e. up to 63,377,500).

Eligible Shareholders can choose to take up all, part or none of their Entitlement. As the Entitlement Offer is non-renounceable, this means that Eligible Shareholders who do not take up their entitlement to participate in the Entitlement Offer will not be able to transfer or receive any value for those entitlements, and their equity interest in the Company will be diluted.

The Entitlement Offer is intended to include a shortfall facility (at the sole discretion of the Board of Directors) under which Eligible Shareholders who take up their full entitlement will be invited to apply for additional Shares, in excess of their entitlement, in the Entitlement Offer from a pool of those entitlements not taken up by other Eligible Shareholders ( Shortfall Facility ). Applications for shares in excess of an Eligible Shareholders Entitlement will be

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capped at an additional 100% of their entitlement, up to a maximum of $25,000. Applications for Additional Shares may be subject to scale-back depending on the final number of Additional Shares, if any, comprising the shortfall of the Entitlement Offer and the quantum applied for by each Eligible Shareholder. There is no guarantee that applicants under this Shortfall Facility will receive all or any of the additional Shares applied for under the Shortfall Facility, and sole discretion with respect to such allocation remains with the Board.

Eligible Shareholders wishing to participate in the Entitlement Offer should carefully read the Offer Booklet and accompanying personalised Entitlement and Acceptance Form which are expected to be dispatched on or around 8 November 2019.

Key Dates of the Entitlement Offer

Event	Date
Announcement of Entitlement Offer	Before 9 am (AEDT), Thursday31stOctober 2019
Ex-date for Entitlement Offer	Wednesday 6thNovember 2019
Record Date	7.00 pm (AEDT), Thursday 7thNovember 2019
Dispatch of Booklet and Entitlement and Acceptance Form	Friday 8thNovember 2019
Entitlement Offer opens (Opening Date)	Friday 8thNovember 2019
Entitlement Offer closes (Closing Date)	5.00 pm (AEDT), Tuesday 19thNovember 2019
Shares quoted on a deferred settlement basis	Wednesday 20thNovember2019
Announcement of shortfall (if any) under the EntitlementOfferNotification of undersubscriptions	Friday 22ndNovember 2019
Issue and allotment of shares under the Entitlement Offer.Dispatch of holding statements	Tuesday 26thNovember 2019
Commencement of trading of new shares	Friday 29thNovember
Shortfall Settlement DateIssue and allotment of Additional Shares under theShortfall Facility	Friday 6thDecember 2019

*** The above timetable is indicative only and subject to change. The quotation of shares is subject to ASX approval. Subject to approval of the Underwriter, the ASX Listing Rules and the Corporations Act 2001 (Cth) and other applicable laws, the Company reserves the right to vary these dates, including the Closing Date, without notice, including extending the period of the Entitlement Offer or accepting late applications, either generally or in particular cases or bringing forward the Closing Date at its discretion. Any extension of the Entitlement Offer will have a consequential effect on the issue date of the Shares under the Entitlement Offer.**

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For more information, please contact the undersigned on 02 8072 1400.

Yours faithfully

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Andrew Whitten Company Secretary

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