DATAWORKS GROUP LIMITED — Capital/Financing Update 2020

Jun 23, 2020

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24 June 2020

$2.2 M Capital Raising and Director resignation

The Board of IXUP Limited ( ASX:IXU ) ( IXUP or Company ), the leading technology company that secures data analytics and collaboration by using next-generation homomorphic encryption, is pleased to announce a $2.2 million capital raising.

The Company will undertake a 1-for-1 non-renounceable, pro rata rights issue to raise $2,228,401 (before costs and subject to rounding) via the issue of 222,840,158 fully paid ordinary shares ( Shares ) (subject to rounding) at an issue price of $0.01 per Share ( Entitlement Offer ).

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

Entitlement Offer

The Entitlement Offer will be a non-renounceable, pro rata entitlement offer to shareholders of the Company on the share register as at 7.00 pm (AEST) on 29 June 2020 ( Record Date ) with a registered address in Australia or New Zealand ( Eligible Shareholders ).

All Shares issued under the Entitlement Offer will rank equally with existing Shares of the Company as of the date of this announcement.

In addition, Eligible Shareholders who take up their full entitlement under the Entitlement Offer will have the opportunity to apply for additional Shares in excess of their entitlement through a shortfall facility ( Shortfall Facility ).

Applications for Shares in excess of an Eligible Shareholder’s entitlement under the Shortfall Facility will be capped up to a maximum of $25,000 per Eligible Shareholder. Therefore, applications under the Shortfall Facility may be subject to scale-back depending on the final number of 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 the Shortfall Facility will receive all or any of the additional Shares applied for under the Shortfall Facility, and sole discretion with respect to allocation remains with the Board.

The Entitlement Offer is non-renounceable and the rights will not be able to be traded on the ASX and will not be transferable.

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 30 June 2020.

A copy of the Offer Booklet will be announced on the ASX and available on the Company’s website.

In addition, if the Entitlement Offer shortfall is less than 50,000,000 shares, being $500,000 at $0.01 per share, Cygnet have a top-up right, to ensure that the total number of shares to be

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allocated by Cygnet, including the shortfall, is not less than 50,000,000 shares. Subscription for shares under the top-up right is subject to shareholder approval.

Indicative Timetable

The indicative timetable for the Entitlement Offer is below.

Event	Date
Announcementof EntitlementOffer	Wednesday,24June2020
Ex-datefor EntitlementOffer	Friday,26 June2020
Record Date	7.00pm (AEST), Monday, 29 June2020
Entitlement Offer opens Dispatchof BookletandEntitlementandAcceptanceForm	Tuesday, 30 June 2020
Entitlement Offer closes (Closing Date)	5.00pm (AEST), Thursday, 9 July2020
Shares quoted on a deferred settlement basis	Friday, 10 July 2020
Announcement of results oftheEntitlement Offer	Monday,13 July2020
Issue and allotment of Offer Shares under the Entitlement Offer	Tuesday, 14 July 2020
Dispatchof holding statements	Wednesday,15 July2020
Commencementof trading of newOfferShares	Wednesday,15 July2020

*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 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. All dates and times in the timetable above are in Sydney, Australia time.

Underwriting Agreement

The material terms of the underwriting agreement between the Company and the Underwriter are as follows:

• Fees – 6% underwriting fee and 20 million unlisted options exercisable at $0.02, on or before 31 July 2024; and

• Other material terms are attached in the schedule to this announcement.

Director resignation

The Company has received a resignation of Mr Scott Wilkie as a Non-Executive Director, who is taking up a full time position with an IXUP Business Partner and will leave the Board on 31 July 2020.

The Board wishes to thank Scott for his contribution to the Company’s development and commercialisation journey and wishes him every success in his new position.

This announcement has been authorised by the IXUP Board.

-ENDS-

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Enquiries :

Peter Leihn, IXUP Tel: +61 413 863 503 peter.leihn@ixup.com

About IXUP

IXUP Limited (pronounced ‘eyes up’) is a listed technology company (ASX: IXU) that secures data analytics and delivers insights within a governance framework. The platform encrypts and connects data from multiple sources, solving the problems of data loss and misuse by enabling data owners to remain in complete control of their data. IXUP was listed in 2017. For more information visit www.ixup.com. IXUP’s registered address is Level 3, 5-7 Ross Street, Parramatta NSW 2150.

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Schedule – Underwriting Agreement – Summary of Material Terms

On 23 June 2020, the Company entered into an underwriting agreement ( Underwriting Agreement ) with the Underwriter under which the Underwriter has agreed to manage and underwrite the Entitlement Offer on the terms, and subject to the conditions, set out in the Underwriting Agreement.

The Underwriter will be remunerated by the Company for providing underwriting and offer management services and may also be reimbursed for certain expenses, as follows:

• a) an underwriting fee of 6% (being a total of $133,704 plus GST) of $2,228,401;

• b) twenty million (20,000,000) unlisted options to acquire Shares under certain terms and conditions, which are exercisable at $0.02, on or before the 31st of July 2024; and

• c) reasonable costs and expenses of and incidental to the Entitlement Offer and the issue of Shares up to a maximum amount of $5,000.

In accordance with the Underwriting Agreement and as is customary with these types of arrangements:

• a) the Company has (subject to certain usual limitations) agreed to indemnify the Underwriter, its officers, employees, and agents ( Indemnified Parties ) against any prosecutions, losses, penalties, actions, suits, claims, expenses, costs, liabilities, charges and proceedings arising directly or indirectly out of or in respect to the Entitlement Offer, non-compliance or breach of any legal requirement or the Listing Rules in relation to the Entitlement Offer, any statement, misstatement, misrepresentation, non-disclosure, inaccuracy or omission in the Entitlement Offer documentation, any advertising, publicity, announcements, statements and reports in relation to the Entitlement Offer or a breach by the Company of any provision including representation or warranty of the Underwriting Agreement;

• b) the Company and the Underwriter have given representations, warranties and undertakings in connection with (among other things) the conduct of the Entitlement Offer;

• c) the Underwriter may enter into sub-underwriting agreements;

• d) the Underwriter may (in certain circumstances) terminate the Underwriting Agreement and be released from its obligations under it on the occurrence of certain events on or prior to the date of allotment of the Offer Shares including (but not limited to) where:

• i. a statement in the Booklet is misleading or deceptive or likely to mislead or deceive, or if any statement in the Booklet becomes misleading or deceptive or likely to mislead or deceive or if the issue of the Booklet is or becomes misleading or deceptive or likely to mislead or deceive;

• ii. approval for Official Quotation has not been granted by 13 July 2020 or, having been granted, is subsequently withdrawn, withheld or qualified;

• iii. there is an outbreak of hostilities or a terrorist act in certain countries;

• iv. certain events occur which may have a materially adverse effect on the Company; v. the shares of the Company finish trading on the ASX on any five (5) consecutive trading days with a daily VWAP that is less than $0.01;

• vi. the Company is prevented from allotting the Offer Shares within the time required by the Underwriting Agreement, under the Listing Rules, any statute, regulation or

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order of a court of competent jurisdiction or any governmental or semi-governmental agency or authority; and

• vii. the All Ordinaries Index (ASX.XAO) as published by ASX is at any time after the date of the Underwriting Agreement 5% or more below its respective level as at the close of business on the Business Day prior to the date of the Underwriting Agreement, on any three (3) consecutive trading days.

The above is not an exhaustive summary of the Underwriting Agreement but a summary of its material terms.