DE.MEM LIMITED — Capital/Financing Update 2018

Feb 19, 2018

Appendix 3B New issue announcement

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

De.mem Limited

ABN

12 614 756 642

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 Ordinary shares be issued 2 Number of[+] securities issued or 620,120 to be issued (if known) or maximum number which may be issued 3 Principal terms of the Fully paid ordinary shares +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)

• See chapter 19 for defined terms.

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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	Yes
	Deemed price of $0.2015 per share, calculated in accordance with the Akwa Worx acquisition agreement.
	Issued as deferred consideration for the acquisition of the issued capital of the Akwa Worx companies upon satisfaction of Milestone 1 of the Akwa Worx acquisition agreement. The Company was obligated to pay $125,000 in shares and $125,000 in cash upon the Akwa Worx group companies achieving revenue over $3.5 million for the six monthperiod ended31 December 2017.
	Yes
	N/A
	620,120

• See chapter 19 for defined terms.

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6d Number of+securities issued with security holder approval under rule 7.1A 6e Number of+securities issued with security holder approval under rule 7.3, or another specific security holder approval (specify date of meeting) 6f Number of+securities issued under an exception in rule 7.2 6g If+securities issued under rule 7.1A, was issue price at least 75% of 15 day VWAP as calculated under rule 7.1A.3? Include the +issue date and both values. Include the source of the VWAP calculation. 6h If+securities were issued under 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 issue capacity under rule 7.1 and rule 7.1A – complete Annexure 1 and release to ASX Market Announcements 7 +Issue dates	N/A
	N/A
	N/A
	N/A
	N/A
	Refer Annexure 1
	20 February 2018

• See chapter 19 for defined terms.

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8 Number and +class of all +securities quoted on ASX (_including_the +securities in section 2 if applicable)	Number	+Class
	107,668,974	Ordinary fully paid shares, including:- 58,655,882 Ordinary fully paid shares, subject to ASX restriction to 7 April 2019 8,676,812 Ordinary fully paid shares, subject to ASX restriction to 14 March 2018 (7,840,843 shares subject to a further voluntary escrow to 7 April 2019) 1,807,200 Ordinary fully paid shares, subject to voluntary escrow to 18 Sept 2018

• See chapter 19 for defined terms.

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9 Number and +class of all +securities not quoted on ASX (_including_the +securities in section 2 if applicable)	Number	+Class
	3,800,000 4,250,000 375,000 375,000 1,250,000	Unlisted options, exercisable at $0.30 each, expiring on or before 30 March 2020, subject to ASX restriction to 7 April 2019 Unlisted options, exercisable at $0.30 each, expiring on or before 21 November 2019, subject to ASX restriction to 7 April 2019 Unlisted options, exercisable at $0.30 each, on or before 15 May 2020, vesting two years from the date of issue, subject to continued and unterminated service to the Company Unlisted options exercisable at $0.30 each, on or before 15 May 2020, vesting two weeks before the anniversary of three years from the date of issue, subject to continued and unterminated service to the Company Unlisted options exercisable at $0.30 each, on or before 11 September 2020

10 Dividend policy (in the case of a N/A trust, distribution policy) on the increased capital (interests)

Part 2 - Pro rata issue – SECTION REMOVED AS NOT APPLICABLE

• See chapter 19 for defined terms.

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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

• See chapter 19 for defined terms.

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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.

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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: 20 February 2018 (Director/Company secretary) Print name: Brett Tucker

== == == == =

• See chapter 19 for defined terms.

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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 7,307,692
securities on issue 12 months before the
+ issue date or date of agreement to issue
Add the following:
• Number of fully paid [+] ordinary securities 65,000,000 (Consideration Offer shares
issued in that 12 month period under an pursuant to the Replacement Prospectus
exception in rule 7.2 dated 16/02/17)
• Number of fully paid [+] ordinary securities 22,500,000 (Public Offer shares pursuant to
issued in that 12 month period with the Replacement Prospectus dated
shareholder approval 16/02/17)
• Number of partly paid [+] ordinary 1,000,000
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 Nil
securities cancelled during that 12 month
period
“A” 95,807,692
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• See chapter 19 for defined terms.

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Step 2: Calculate 15% of “A”

“B” 0.15 [Note: this value cannot be changed] Multiply “A” by 0.15 14,371,154

Step 3: Calculate “C”, the amount of placement capacity under rule 7.1 that has already been used

• Insert number of[+] equity securities issued 1,250,000 – Lead Manager options (issued or agreed to be issued in that 12 month on 11 September 2017) period not counting those issued: 1,807,200 – Akwa Worx vendor shares

• • Under an exception in rule 7.2 (issued on 18 September 2017) • Under rule 7.1A 9,433,962 – Placement to Institutional investors from Australia, Germany and

• • With security holder approval under rule Singapore 7.1 or rule 7.4 620,120 – Akwa Worx deferred

• Note: condsideration shares for meeting Milestone • This applies to equity securities, unless 1 (issued on 20 February 2018) 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

“C” 13,111,282

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

“A” x 0.15 14,371,154 Note: number must be same as shown in Step 2 Subtract “C” 13,111,282 Note: number must be same as shown in Step 3 Total [“A” x 0.15] – “C” 1,259,872 [Note: this is the remaining placement capacity under rule 7.1]

• See chapter 19 for defined terms.

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Part 2 – Not Applicable

Rule 7.1A – Additional placement capacity for eligible entities

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

“A” 95,807,692 Note: number must be same as shown in Step 1 of Part 1 Step 2: Calculate 10% of “A” “D” 0.10 Note: this value cannot be changed Multiply “A” by 0.10 9,580,769

Step 3: Calculate “E”, the amount of placement capacity under rule 7.1A that has already been used

Insert number of[+] equity securities issued Nil 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” Nil

• See chapter 19 for defined terms.

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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	9,580,769
Subtract“E” Note: number must be same as shown in Step 3	Nil
Total[“A” x 0.10] – “E”	9,580,769 Note: this is the remaining placement capacity under rule 7.1A

• See chapter 19 for defined terms.

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