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INFOCUS GROUP HOLDINGS LIMITED AGM Information 2021

Oct 19, 2021

65103_rns_2021-10-19_86a5bcfe-b6e1-481a-b129-4d9a57d651df.pdf

AGM Information

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20 October 2021

NOTICE OF ANNUAL GENERAL MEETING

Notice is hereby given that the Annual General Meeting of Shareholders of Frugl Group Limited ACN 096 870 978 ( Frugl or the Company ) will be held CWA House, 1176 Hay Street, West Perth, 6005 at 10:00 (WST) on 19 November 2021 ( General Meeting, AGM or Meeting ).

In line with the discretion provided by The Treasury Law Amendments (2021 Measure No. 1) Act 2021, the Company will not be despatching physical copies of the full Notice of Meeting to shareholders. Instead, with the exception of the proxy voting form, the Notice and accompanying Explanatory Notes (Meeting Materials) are being made available to Shareholders electronically. This means that:

You can access the Meeting Materials online at the Company’s website:

fruglgroup.com.au or at the Company’s share registry’s voting

website investor.automic.com.au by logging in.

A complete copy of the Meeting Materials has been posted to the Company’s ASX Market announcements page at www.asx.com.au under the Company’s ASX code “FGL”.

A copy of your personalised proxy form is enclosed for your convenience. Please complete and return the attached proxy form to the Company’s share registry,

Automic Group by:

post to: Automic GPO Box 5193 Sydney NSW 2001 email to: [email protected]

Proxy votes may also be lodged online using the following link: investor.automic.com.au

If you have provided an email address and have elected to receive electronic communications from the Company, you will receive an email to your nominated email address with a link to an electronic copy of the Meeting materials and the voting instruction form. The Company recommends electronic communication as its preferred method of communicating with shareholders. Please contact the registry for further details on updating your communication preferences.

If you are unable to access the Meeting Materials on-line, please contact our share registry Automic Group at [email protected] or by phone at +61 2 8583 3040 , or the Company on + 61 8 6489 1600 , to arrange a copy.

As the health guidelines in response to the COVID19 pandemic are subject to change as short notice, arrangements for the meeting may be amended at short notice prior to the meeting date. The Company will keep shareholders informed via the ASX Market Announcements Platform if changes to the timing or format are necessary to comply with

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any government restrictions. The Company strongly recommends to Shareholders to lodge a directed proxy as soon as possible in advance of the meeting even if they are planning to attend the meeting.

This Notice and Explanatory Notes should be read in its entirety. If Shareholders are in doubt as to how they should vote, they should seek advice from their accountant

Yours faithfully,

Jonathan Wild Chairman

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FRUGL GROUP LIMITED

ACN 096 870 978

NOTICE OF ANNUAL GENERAL MEETING

Notice is given that the Meeting will be held at:

TIME : 10:00 am (WST)

DATE : 19 November 2021

PLACE : CWA House, 1176 Hay St, West Perth WA 6005

The business of the Meeting affects your shareholding and your vote is important.

This Notice of Meeting should be read in its entirety. If Shareholders are in doubt as to how they should vote, they should seek advice from their professional advisers prior to voting.

The Directors have determined pursuant to Regulation 7.11.37 of the Corporations Regulations 2001 (Cth) that the persons eligible to vote at the Meeting are those who are registered Shareholders at 10:00 am on 17 November 2021.

BUSINESS OF THE MEETING

AGENDA

1. FINANCIAL STATEMENTS AND REPORTS

To receive and consider the annual financial report of the Company for the financial year ended 30 June 2021 together with the declaration of the Directors, the Director’s report, the Remuneration Report and the auditor’s report.

2. RESOLUTION 1 – ADOPTION OF REMUNERATION REPORT

To consider and, if thought fit, to pass, with or without amendment, the following resolution as a non-binding resolution :

“That, for the purposes of section 250R(2) of the Corporations Act and for all other purposes, approval is given for the adoption of the Remuneration Report as contained in the Company’s annual financial report for the financial year ended 30 June 2021.”

Note: the vote on this Resolution is advisory only and does not bind the Directors or the Company.

A voting prohibition statement applies to this Resolution. Please see below.

3. RESOLUTION 2 – RE-ELECTION OF DIRECTOR – JONATHAN WILD

To consider and, if thought fit, to pass, with or without amendment, the following resolution as an ordinary resolution :

“That, for the purpose of clause 14.2 of the Constitution, and for all other purposes, Jonathan Wild, a Director, retires by rotation, and being eligible, is re-elected as a Director.”

4. RESOLUTION 3 – RATIFICATION OF PRIOR ISSUE OF SHARES – LISTING RULE 7.1

To consider and, if thought fit, to pass, with or without amendment, the following resolution as an ordinary resolution :

“That, for the purposes of Listing Rule 7.4 and for all other purposes, Shareholders ratify the issue of 2,500,000 Shares on the terms and conditions set out in the Explanatory Statement.”

A voting exclusion statement applies to this Resolution. Please see below.

5. RESOLUTION 4 – RATIFICATION OF PRIOR ISSUE OF SHARES – LISTING RULE 7.1

To consider and, if thought fit, to pass, with or without amendment, the following resolution as an ordinary resolution :

“That, for the purposes of Listing Rule 7.4 and for all other purposes, Shareholders ratify the issue of 500,000 Shares on the terms and conditions set out in the Explanatory Statement.”

A voting exclusion statement applies to this Resolution. Please see below.

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6. RESOLUTION 5 – RATIFICATION OF PRIOR ISSUE OF SHARES – LISTING RULE 7.1A

To consider and, if thought fit, to pass, with or without amendment, the following resolution as an ordinary resolution :

“That, for the purposes of Listing Rule 7.4 and for all other purposes, Shareholders ratify the issue of 16,000,000 Shares on the terms and conditions set out in the Explanatory Statement.”

A voting exclusion statement applies to this Resolution. Please see below.

7. RESOLUTION 6 – RATIFICATION OF PRIOR ISSUE OF OPTIONS – LISTING RULE 7.1

To consider and, if thought fit, to pass, with or without amendment, the following resolution as an ordinary resolution :

“That, for the purposes of Listing Rule 7.4 and for all other purposes, Shareholders ratify the issue of 16,500,000 Options on the terms and conditions set out in the Explanatory Statement.”

A voting exclusion statement applies to this Resolution. Please see below.

8. RESOLUTION 7 – ISSUE OF OPTIONS TO RELATED PARTY – SEAN SMITH

To consider and, if thought fit, to pass, with or without amendment, the following resolution as an ordinary resolution :

“That, for the purposes of Listing Rule 10.11 and for all other purposes, approval is given for the Company to issue 6,000,000 Options to Sean Smith (or their nominee) on the terms and conditions set out in the Explanatory Statement.”

A voting exclusion statement and voting prohibition statement applies to this Resolution. Please see below.

9. RESOLUTION 8 – ISSUE OF OPTIONS TO RELATED PARTY - JONATHAN WILD

To consider and, if thought fit, to pass, with or without amendment, the following resolution as an ordinary resolution :

“That, for the purposes of Listing Rule 10.11 and for all other purposes, approval is given for the Company to issue 3,000,000 Options to Jonathan Wild (or their nominee) on the terms and conditions set out in the Explanatory Statement.”

A voting exclusion statement and voting prohibition statement applies to this Resolution. Please see below.

10. RESOLUTION 9 – APPROVAL TO ISSUE OPTIONS – ALISTAIR MCCALL

To consider and, if thought fit, to pass, with or without amendment, the following resolution as an ordinary resolution :

“That, for the purposes of Listing Rule 7.1 and for all other purposes, approval is given for the Company to issue 4,000,000 Options to Alistair McCall on the terms and conditions set out in the Explanatory Statement.”

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A voting exclusion statement applies to this Resolution. Please see below.

11. RESOLUTION 10 – ADOPTION OF INCENTIVE OPTION PLAN

To consider and, if thought fit, to pass, with or without amendment, the following resolution as an ordinary resolution :

“That, for the purposes of Listing Rule 7.2 (Exception 13(b)) and for all other purposes, approval is given for the Company to adopt an employee incentive scheme titled Incentive Option Plan and for the issue of up to 9,000,000 securities under that Option Plan, on the terms and conditions set out in the Explanatory Statement.”

A voting exclusion statement and voting prohibition statement applies to this Resolution. Please see below.

12. RESOLUTION 11 – APPROVAL OF 7.1A MANDATE

To consider and, if thought fit, to pass the following resolution as a special resolution :

“That, for the purposes of Listing Rule 7.1A and for all other purposes, approval is given for the Company to issue up to that number of Equity Securities equal to 10% of the issued capital of the Company at the time of issue, calculated in accordance with the formula prescribed in Listing Rule 7.1A.2 and otherwise on the terms and conditions set out in the Explanatory Statement.”

Dated: 20 October 2021

By order of the Board

Jonathan Wild Chairman

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Voting Prohibition Statements

Resolution 1 – Adoption of
Remuneration Report		 A vote on this Resolution must not be cast (in any capacity) by or on behalf of
either of the following persons:
(a)
a member of the Key Management Personnel, details of whose
remuneration are included in the Remuneration Report; or
(b)
a Closely Related Party of such a member.
However, a person (thevoter) described above may cast a vote on this
Resolution as a proxy if the vote is not cast on behalf of a person described
above and either:
(a)
the voter is appointed as a proxy by writing that specifies the way the
proxy is to vote on this Resolution; or
(b)
the voter is the Chair and the appointment of the Chair as proxy:
(i)
does not specify the way the proxy is to vote on this
Resolution; and
(ii)
expressly authorises the Chair to exercise the proxy even
though this Resolution is connected directly or indirectly with
the remuneration of a member of the Key Management
Personnel.
Resolutions 7 & 8 – Issue of
Options to Related Party		 A person appointed as a proxy must not vote on the basis of that
appointment, on this Resolution if:
(a)
the proxy is either:
(i)
a member of the Key Management Personnel; or
(ii)
a Closely Related Party of such a member; and
(b)
the appointment does not specify the way the proxy is to vote on
this Resolution.
However, the above prohibition does not apply if:
(a)
the proxy is the Chair; and
(b)
the appointment expressly authorises the Chair to exercise the
proxy even though this Resolution is connected directly or
indirectly with remuneration of a member of the Key Management
Personnel.
Resolution 10 – Adoption of
Incentive Option Plan		 A person appointed as a proxy must not vote on the basis of that
appointment, on this Resolution if:
(a)
the proxy is either:
(i)
a member of the Key Management Personnel; or
(ii)
a Closely Related Party of such a member; and
(b)
the appointment does not specify the way the proxy is to vote on
this Resolution.
However, the above prohibition does not apply if:
(a)
the proxy is the Chair; and
(b)
the appointment expressly authorises the Chair to exercise the
proxy even though this Resolution is connected directly or
indirectly with remuneration of a member of the Key Management
Personnel.

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Voting Exclusion Statements

In accordance with Listing Rule 14.11, the Company will disregard any votes cast in favour of the resolution set out below by or on behalf of the following persons:

Resolution 3 – Ratification of
prior issue of Shares		 A person who participated in the issue or is a counterparty to the
agreement being approved (namely (S3 Consortium Pty Ltd) or an
associate of that person or those persons.
Resolution 4 & 5 –
Ratification of prior issue of
Shares		 A person who participated in the issue or is a counterparty to the
agreement being approved or an associate of that person or those
persons.
Resolution 6 – Ratification of
prior issue of Options		 A person who participated in the issue or is a counterparty to the
agreement being approved or an associate of that person or those
persons.
Resolution 7 – Issue of
Options to a Related Party		 Sean Smith (or their nominee) and any other person who will obtain a
material benefit as a result of the issue of the securities (except a benefit
solely by reason of being a holder of ordinary securities in the Company)
or an associate of that person or those persons.
Resolution 8 – Issue of
Options to a Related Party		 Jonathan Wild (or their nominee) and any other person who will obtain a
material benefit as a result of the issue of the securities (except a benefit
solely by reason of being a holder of ordinary securities in the Company)
or an associate of that person or those persons.
Resolution 9 – Approval to
issue Options		 A person who is expected to participate in, or who will obtain a material
benefit as a result of, the proposed issue (except a benefit solely by reason
of being a holder of ordinary securities in the Company) Alistair McCall or
an associate of that person (or those persons).
Resolution 10 – Adoption of
Incentive Option Plan		 A person who is eligible to participate in the employee incentive scheme
or an associate of that person or those persons.

However, this does not apply to a vote cast in favour of the Resolution by:

  • (a) a person as a proxy or attorney for a person who is entitled to vote on the Resolution, in accordance with the directions given to the proxy or attorney to vote on the Resolution in that way; or

  • (b) the Chair as proxy or attorney for a person who is entitled to vote on the Resolution, in accordance with a direction given to the Chair to vote on the Resolution as the Chair decides; or

  • (c) a holder acting solely in a nominee, trustee, custodial or other fiduciary capacity on behalf of a beneficiary provided the following conditions are met:

  • (i) the beneficiary provides written confirmation to the holder that the beneficiary is not excluded from voting, and is not an associate of a person excluded from voting, on the resolution; and

  • (ii) the holder votes on the resolution in accordance with directions given by the beneficiary to the holder to vote in that way.

Voting by proxy

To vote by proxy, please complete and sign the enclosed Proxy Form and return by the time and in accordance with the instructions set out on the Proxy Form.

In accordance with section 249L of the Corporations Act, Shareholders are advised that:

  • each Shareholder has a right to appoint a proxy;

  • the proxy need not be a Shareholder of the Company; and

  • a Shareholder who is entitled to cast two (2) or more votes may appoint two (2) proxies and may specify the proportion or number of votes each proxy is appointed to exercise. If the member appoints two (2) proxies and the appointment does not specify the

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proportion or number of the member’s votes, then in accordance with section 249X(3) of the Corporations Act, each proxy may exercise one-half of the votes.

Shareholders and their proxies should be aware that:

  • if proxy holders vote, they must cast all directed proxies as directed; and

  • any directed proxies which are not voted will automatically default to the Chair, who must vote the proxies as directed.

Voting in person

To vote in person, attend the Meeting at the time, date and place set out above.

You may still attend the meeting and vote in person even if you have appointed a proxy. If you have previously submitted a Proxy Form, your attendance will not revoke your proxy appointment unless you actually vote at the meeting for which the proxy is proposed to be used, in which case, the proxy’s appointment is deemed to be revoked with respect to voting on that resolution.

Please bring your personalised Proxy Form with you as it will help you to register your attendance at the meeting. If you do not bring your Proxy Form with you, you can still attend the meeting but representatives from the Company’s share registry will need to verify your identity.

Should you wish to discuss the matters in this Notice of Meeting please do not hesitate to contact the Company Secretary on +61 8 6489 1600.

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EXPLANATORY STATEMENT

This Explanatory Statement has been prepared to provide information which the Directors believe to be material to Shareholders in deciding whether or not to pass the Resolutions.

FINANCIAL STATEMENTS AND REPORTS

In accordance with the Corporations Act, the business of the Meeting will include receipt and consideration of the annual financial report of the Company for the financial year ended 30 June 2021 together with the declaration of the Directors, the Directors’ report, the Remuneration Report and the auditor’s report.

The Company will not provide a hard copy of the Company’s annual financial report to Shareholders unless specifically requested to do so. The Company’s annual financial report is available on its website at www.frugl.com.au .

1. RESOLUTION 1 – ADOPTION OF REMUNERATION REPORT

1.1 General

The Corporations Act requires that at a listed company’s annual general meeting, a resolution that the remuneration report be adopted must be put to the shareholders. However, such a resolution is advisory only and does not bind the company or the directors of the company.

The remuneration report sets out the company’s remuneration arrangements for the directors and senior management of the company. The remuneration report is part of the directors’ report contained in the annual financial report of the company for a financial year.

The chair of the meeting must allow a reasonable opportunity for its shareholders to ask questions about or make comments on the remuneration report at the annual general meeting.

1.2 Voting consequences

A company is required to put to its shareholders a resolution proposing the calling of another meeting of shareholders to consider the appointment of directors of the company ( Spill Resolution ) if, at consecutive annual general meetings, at least 25% of the votes cast on a remuneration report resolution are voted against adoption of the remuneration report and at the first of those annual general meetings a Spill Resolution was not put to vote. If required, the Spill Resolution must be put to vote at the second of those annual general meetings.

If more than 50% of votes cast are in favour of the Spill Resolution, the company must convene a shareholder meeting ( Spill Meeting ) within 90 days of the second annual general meeting.

All of the directors of the company who were in office when the directors' report (as included in the company’s annual financial report for the most recent financial year) was approved, other than the managing director of the company, will cease to hold office immediately before the end of the Spill Meeting but may stand for re-election at the Spill Meeting.

Following the Spill Meeting those persons whose election or re-election as directors of the company is approved will be the directors of the company.

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At the Company’s previous annual general meeting the votes cast against the remuneration report considered at that annual general meeting were less than 25%. Accordingly, the Spill Resolution is not relevant for this Meeting.

2. RESOLUTION 2 – RE-ELECTION OF DIRECTOR – JONATHAN WILD

2.1 General

Listing Rule 14.5 provides that an entity which has directors must hold an election of directors at each annual general meeting.

The Constitution sets out the requirements for determining which Directors are to retire by rotation at an annual general meeting.

Jonathon Wild, who has served as a Director since 21 February 2017 and was last re-elected on 29 November 2019, retires by rotation and seeks re-election.

2.2 Qualifications and other material directorships

Jonathan Wild has been a marketing leader for the past twenty years across a diverse range of categories and companies including Unilever, British Telecom (where he launched the O2 brand in Europe), Telstra, Orbitz Worldwide and more recently at Groupon (NASDAQ:GRPN) in roles including CMO (APAC) and VP of Marketing (North America). He is currently consulting to early-stage online AU businesses.

Mr Wild has extensive mobile, digital and commercial experience having led marketing strategy from start-ups to large multinational corporate organisations. His passion for disruptive narratives combined with a strong understanding of how technology is constantly changing the interaction between people, brands and business have built Mr Wild’s international reputation for marketing strategy leadership.

2.3 Independence

If elected the Board considers Jonathan Wild is an independent director.

2.4 Board recommendation

The Board has reviewed Jonathan Wild’s performance since his appointment to the Board and considers that Jonathan Wild’s skills and experience will continue to enhance the Board’s ability to perform its role. Accordingly, the Board supports the re-election of Jonathan Wild and recommends that Shareholders vote in favour of Resolution 2.

3. RESOLUTION 3 – RATIFICATION OF PRIOR ISSUE OF SHARES – LISTING RULE 7.1

3.1 General

On 29 January 2021, the Company issued 2,500,000 to S3 Consortium Pty Ltd ( S3 ) , in consideration for marketing and investor relations services provided to the Company. ( Consultancy Shares ).

3.2 Listing Rules 7.1 and 7.1A

Broadly speaking, and subject to a number of exceptions, Listing Rule 7.1 limits the amount of equity securities that a listed company can issue without the approval

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of its shareholders over any 12-month period to 15% of the fully paid ordinary shares it had on issue at the start of that period.

Under Listing Rule 7.1A, an eligible entity can seek approval from its members, by way of a special resolution passed at its annual general meeting, to increase this 15% limit by an extra 10% to 25%. The Company obtained approval to increase its limit to 25% at the annual general meeting held on 30 November 2020.

The issue of the Consultancy Shares does not fit within any of the exceptions set out in Listing Rule 7.2 and, as it has not yet been approved by Shareholders, it uses up part of the 15% limit in Listing Rule 7.1, reducing the Company’s capacity to issue further equity securities without Shareholder approval under Listing Rule 7.1 for the 12-month period following the date of their issue.

3.3

Listing Rule 7.4

Listing Rule 7.4 allows the shareholders of a listed company to approve an issue of equity securities after it has been made or agreed to be made. If they do, the issue is taken to have been approved under Listing Rule 7.1 and so does not reduce the company’s capacity to issue further equity securities without shareholder approval under that rule.

The Company wishes to retain as much flexibility as possible to issue additional equity securities in the future without having to obtain Shareholder approval for such issues under Listing Rule 7.1. Accordingly, Resolution 3 seeks Shareholder ratification pursuant to Listing Rule 7.4 for the issue of the Consultancy Shares.

3.4 Technical information required by Listing Rule 14.1A

If Resolution 3 is passed, the Consultancy Shares will be excluded in calculating the Company’s combined 25% limit in Listing Rules 7.1 and 7.1A, increasing the number of equity securities the Company can issue without Shareholder approval over the 12-month period following the date of issue of the Consultancy Shares.

If Resolution 3 is not passed, the Consultancy Shares will continue to be included in calculating the Company’s combined 25% limit in Listing Rules 7.1 and 7.1A, decreasing the number of equity securities that the Company can issue without Shareholder approval for the 12-month period following the date of their issue.

It is noted that the Company’s ability to utilise the additional 10% capacity provided for in Listing Rule 7.1A for issues of equity securities following this Meeting remains conditional on Resolution 11 being passed at this Meeting.

3.5 Technical information required by Listing Rule 7.5

Pursuant to and in accordance with Listing Rule 7.5, the following information is provided in relation to Resolution 3:

  • (a) the Consultancy Shares were issued to S3;

  • (b) in accordance with paragraph 7.4 of ASX Guidance Note 21, the Company confirms that none of the recipients were:

  • (i) related parties of the Company, members of the Company’s Key Management Personnel, substantial holders of the Company, advisers of the Company or an associate of any of these parties; and

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  • (ii) issued more than 1% of the issued capital of the Company;

  • (c) 2,500,000 Consultancy Shares were issued, and the Consultancy Shares issued were all fully paid ordinary shares in the capital of the Company issued on the same terms and conditions as the Company’s existing Shares;

  • (d) the Consultancy Shares were issued on 29 January 2021;

  • (e) The Company raised no funds through the issue of the Consultancy Shares.

  • (f) the Consultancy Shares were issued as consideration for marketing and investor relations services provided to the Company by S3.

  • (g) The shares are being issued under an agreement for the provision of digital marketing services between the Company and S3. S3 will produce and distribute sponsored content to potential investors in the Company. The Company agreed to pay $100,000 plus GST for the services. The terms of the agreement provided for the payment to be made in Shares, which the Company elected to do. The agreement is ongoing and may be terminated by the Company with three months’ written notice.

4. RESOLUTIONS 4 & 5 – RATIFICATION OF PRIOR ISSUE OF SHARES - LISTING RULES 7.1 AND 7.1A

4.1 General

On 19 July 2021, the Company issued 16,500,000 Shares at an issue price of $0.05 per Share to raise $825,000 ( Capital Raising Shares ).

500,000 Shares were issued pursuant to the Company’s capacity under Listing Rule 7.1 (being, the subject of Resolution 4) and 16,000,000 Shares were issued pursuant to the Company’s 7.1A mandate which was approved by Shareholders at the annual general meeting held on 30 November 2020.

The Company engaged the services of CPS Capital Group Pty Ltd (ACN 632 670 618) ( CPS Capital ) (AFSL 294848), to manage the issue of the Capital Raising Shares. The Company agreed to pay CPS Capital a Lead Manager fee of $49,500 (being, 6% of the amount raised under the issue of the Capital Raising Shares.

4.2 Listing Rules 7.1 and 7.1A

As summarised in Section 3.1 above, Listing Rule 7.1 limits the amount of equity securities that a listed company can issue without the approval of its shareholders over any 12-month period to 15% of the fully paid ordinary securities it had on issue at the start of that 12-month period. Listing Rule 7.1A permits an eligible entity to increase this 15% limit by an extra 10% to 25%. The Company obtained approval to increase its limit to 25% at the annual general meeting held on 30 November 2020.

The issue of the Capital Raising Shares does not fit within any of the exceptions set out in Listing Rule 7.2 and, as it has not yet been approved by Shareholders, it uses up part of the 25% limit in Listing Rules 7.1 and 7.1A, reducing the Company’s capacity to issue further equity securities without Shareholder approval under Listing Rule 7.1 and 7.1A for the 12-month period following the date of issue of the Capital Raising Shares.

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4.3 Listing Rule 7.4

A summary of Listing Rule 7.4 is set out in Section 3.3 above. The Company is seeking Shareholder ratification pursuant to Listing Rule 7.4 for the issue of the Capital Raising Shares.

Resolutions 4 and 5 seek Shareholder ratification pursuant to Listing Rule 7.4 for the issue of the Capital Raising Shares.

4.4 Technical information required by Listing Rule 14.1A

If Resolutions 4 and 5 are passed, the Capital Raising Shares will be excluded in calculating the Company’s combined 25% limit in Listing Rules 7.1 and 7.1A, effectively increasing the number of equity securities the Company can issue without Shareholder approval over the 12-month period following the date of issue of the Capital Raising Shares.

If Resolutions 4 and 5 are not passed, the Capital Raising Shares will be included in calculating the Company’s combined 25% limit in Listing Rules 7.1 and 7.1A, decreasing the number of equity securities the Company can issue without Shareholder approval over the 12-month period following the date of issue of the Capital Raising Shares.

It is noted that the Company’s ability to utilise the additional 10% capacity provided for in Listing Rule 7.1A for issues of equity securities following this Meeting remains conditional on Resolution 11 being passed at this Meeting.

4.5 Technical information required by Listing Rule 7.5

Pursuant to and in accordance with Listing Rule 7.5, the following information is provided in relation to Resolutions 4 and 5:

  • (a) the Capital Raising Shares were issued to professional and sophisticated investors who are clients of CPS Capital. The recipients were identified through a bookbuild process, which involved CPS Capital seeking expressions of interest to participate in the capital raising from nonrelated parties of the Company;

  • (b) in accordance with paragraph 7.4 of ASX Guidance Note 21, the Company confirms that none of the recipients were:

  • (i) related parties of the Company, members of the Company’s Key Management Personnel, substantial holders of the Company, advisers of the Company or an associate of any of these parties; and

  • (ii) issued more than 1% of the issued capital of the Company;

  • (c) 16,500,000 Capital Raising Shares were issued on the following basis:

  • (i) 500,000 Shares issued pursuant to Listing Rule 7.1 (ratification of which is sought under Resolution 4); and

  • (ii) 16,000,000 Shares issued pursuant to Listing Rule 7.1A (ratification of which is sought under Resolution 5);

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  • (d) the Capital Raising Shares issued were all fully paid ordinary shares in the capital of the Company issued on the same terms and conditions as the Company’s existing Shares;

  • (e) the Capital Raising Shares were issued on 19 July 2021;

  • (f) the issue price was $0.05 per Capital Raising Shares under both the issue of Shares pursuant to Listing Rule 7.1 and Listing Rule 7.1A. The Company has not and will not receive any other consideration for the issue of the Capital Raising Shares;

  • (g) the purpose of the issue of the Capital Raising Shares was to raise $825,000, which will be applied towards marketing and the ongoing work for the commercialisation of the Company’s Frugl app and data analytics products; and

  • (h) the Capital Raising Shares were not issued under an agreement.

5. RESOLUTION 6 – RATIFICATION OF PRIOR ISSUE OF OPTIONS – LISTING RULE 7.1

5.1 General

On 19 July 2021, the Company issued 16,500,000 1-for-1 free attaching Options to the Capital Raising Shares. These Options are exercisable at $0.10 per Option on or before 20 July 2024 ( Capital Raising Options ).

5.2 Listing Rules 7.1 and 7.4

As summarised in Section 3.2 above, Listing Rule 7.1 limits the amount of equity securities that a listed company can issue without the approval of its shareholders over any 12-month period to 15% of the fully paid ordinary securities it had on issue at the start of that 12-month period.

The issue of the Capital Raising Options does not fit within any of the exceptions set out in Listing Rule 7.2 and is currently using up part of the 15% limit in Listing Rule 7.1, reducing the Company’s capacity to issue further equity securities without Shareholder approval under Listing Rule 7.1 for the 12-month period following the date of issue of the Capital Raising Options.

A summary of Listing Rule 7.4 is set out in Section 3.3 above. The Company wishes to retain as much flexibility as possible to issue additional equity securities in the future without having to obtain Shareholder approval for such issues under Listing Rule 7.1. Accordingly, Resolution 6 seeks Shareholder ratification pursuant to Listing Rule 7.4 for the issue of the Capital Raising Options.

5.3 Technical information required by Listing Rule 14.1A

If Resolution 6 is passed, the Capital Raising Options will be excluded in calculating the Company’s 15% limit in Listing Rule 7.1, increasing the number of equity securities the Company can issue without Shareholder approval over the 12month period following the issue of the Capital Raising Options.

If Resolution 6 is not passed, the Capital Raising Options will be included in calculating the Company’s 15% limit in Listing Rule 7.1, decreasing the number of equity securities that the Company can issue without Shareholder approval over the 12-month period following the date of their issue.

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5.4 Technical information required by Listing Rule 7.5

Pursuant to and in accordance with Listing Rule 7.5, the following information is provided in relation to Resolution 6:

  • (a) the Capital Raising Options were issued to professional and sophisticated investors who are clients of CPS Capital. The recipients were identified through a bookbuild process, which involved CPS Capital seeking expressions of interest to participate in the capital raising from nonrelated parties of the Company;

  • (b) in accordance with paragraph 7.4 of ASX Guidance Note 21, the Company confirms that none of the recipients were:

  • (i) related parties of the Company, members of the Company’s Key Management Personnel, substantial holders of the Company, advisers of the Company or an associate of any of these parties; and

  • (ii) issued more than 1% of the issued capital of the Company;

  • (c) 16,500,000 Capital Raising Options were issued and the Capital Raising Options were issued on the terms and conditions set out in Schedule 1;

  • (d) the Capital Raising Options were issued on 19 July 2021;

  • (e) the Capital Raising Options were issued free attaching on a 1-for-1 basis with the purchase of the Capital Raising Shares the subject of Resolutions 4 and 5.

  • (f) the Capital Raising Options were not issued under an agreement.

6. RESOLUTIONS 7 & 8 – ISSUE OF OPTIONS TO RELATED PARTIES – SEAN SMITH AND JONATHON WILD

6.1 General

The Company has agreed, subject to obtaining Shareholder approval, to issue 6,000,000 Options to Sean Smith and 3,000,000 to Jonathan Wild ( Director Options ) (or their nominees) on the terms and conditions set out below.

Resolutions 7 and 8 seek Shareholder approval for the issue of the Director Options to Sean Smith and Jonathan Wild (or their nominee).

6.2 Chapter 2E of the Corporations Act

For a public company, or an entity that the public company controls, to give a financial benefit to a related party of the public company, the public company or entity must:

  • (a) obtain the approval of the public company’s members in the manner set out in sections 217 to 227 of the Corporations Act; and

  • (b) give the benefit within 15 months following such approval,

unless the giving of the financial benefit falls within an exception set out in sections 210 to 216 of the Corporations Act.

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The issue of Director Options to Sean Smith and Jonathan Wild (or their nominees) constitutes giving a financial benefit and Sean Smith and Jonathan Wild are related parties of the Company by virtue of being Directors.

The Directors have considered the issue of the related party options, with Sean Smith and Jonathan Wild abstaining from these considerations at all relevant times due to their material personal interest in these Resolutions, and consider that Shareholder approval pursuant to Chapter 2E of the Corporations Act is not required in respect of the grant of Director Options because the agreement to issue the Director Options, reached as part of the remuneration packages for Sean Smith and Jonathan Wild, are considered reasonable remuneration in the circumstances and was negotiated on an arm’s length basis.

6.3 Listing Rule 10.11

Listing Rule 10.11 provides that unless one of the exceptions in Listing Rule 10.12 applies, a listed company must not issue or agree to issue equity securities to:

  • 10.11.1 a related party;

  • 10.11.2 a person who is, or was at any time in the 6 months before the issue or agreement, a substantial (30%+) holder in the company;

  • 10.11.3 a person who is, or was at any time in the 6 months before the issue or agreement, a substantial (10%+) holder in the company and who has nominated a director to the board of the company pursuant to a relevant agreement which gives them a right or expectation to do so;

  • 10.11.4 an associate of a person referred to in Listing Rules 10.11.1 to 10.11.3; or

  • 10.11.5 a person whose relationship with the company or a person referred to in Listing Rules 10.11.1 to 10.11.4 is such that, in ASX’s opinion, the issue or agreement should be approved by its shareholders,

unless it obtains the approval of its shareholders.

The issue of Director Options falls within Listing Rule 10.11.1 and does not fall within any of the exceptions in Listing Rule 10.12. It therefore requires the approval of Shareholders under Listing Rule 10.11.

Resolutions 7 and 8 seek the required Shareholder approval for the issue of the Director Options under and for the purposes of Listing Rule 10.11.

6.4 Technical information required by Listing Rule 14.1A

If Resolutions 7 and 8 are passed, the Company will be able to proceed with the issue of the Director Options to Sean Smith and Jonathan Wild within one (1) month after the date of the Meeting (or such later date as permitted by any ASX waiver or modification of the Listing Rules). As approval pursuant to Listing Rule 7.1 is not required for the issue of the Director Options (because approval is being obtained under Listing Rule 10.11), the issue of the Director Options will not use up any of the Company’s 15% annual placement capacity.

If Resolutions 7 and 8 are not passed, the Company will not be able to proceed with the issue of the Director Options.

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6.5 Technical Information required by Listing Rule 10.13

Pursuant to and in accordance with Listing Rule 10.13, the following information is provided in relation to Resolutions 7 and 8:

  • (a) the Director Options will be issued to Sean Smith and Jonathan Wild (or their nominees), who fall within the category set out in Listing Rule 10.11.1 as Sean Smith and Jonathan Wild are related parties of the Company by virtue of being Directors;

  • (b) the maximum number of Director Options to be issued is 9,000,000, comprising:

  • (i) 6,000,000 Director Options to Sean Smith (the subject of Resolution 7); and

  • (ii) 3,000,000 Director Options to Jonathan Wild (the subject of Resolution 8);

  • (c) the terms and conditions of the Director Options are set out in Schedule 1;

  • (d) the Director Options will be issued no later than one (1) month after the date of the Meeting (or such later date to the extent permitted by any ASX waiver or modification of the Listing Rules) and it is intended that issue of the Director Options will occur on the same date;

  • (e) the issue price of the Options will be nil. The Company will not receive any other consideration in respect of the issue of the Director Options (other than in respect of funds received on exercise of the Director Options);

  • (f) the purpose of the issue of the Director Options is to provide a performance linked incentive component in the remuneration package for Sean Smith and Jonathan Wild to motivate and reward their performance as Directors and to provide cost effective remuneration to Sean Smith and Jonathan Wild, enabling the Company to spend a greater proportion of its cash reserves on its operations than it would if alternative cash forms of remuneration were given to Sean Smith and Jonathan Wild;

  • (g) the current total remuneration package for Sean Smith is $314,600, comprising of salary of $286,000, and a superannuation payment of $28,600. If the Director Options are issued, the total remuneration package of Sean Smith and Jonathan Wild will increase by $60,000 to $375,600, being the value of the Director Options (based on the Black Scholes methodology); and

  • (h) the current total remuneration package for Jonathan Wild is $96,000, comprising fully of directors’ fees. If the Director Options are issued, the total remuneration package of Sean Smith and Jonathan Wild will increase by $30,000 to $126,000, being the value of the Director Options (based on the Black Scholes methodology); and

  • (i) the Director Options are not being issued under an agreement.

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7. RESOLUTION 9 – APPROVAL TO ISSUE OPTIONS – ALISTAIR MCCALL

7.1 General

The Company is proposing to issue 4,000,000 Options to Alistair McCall in part consideration for services provided in the role of Chief Data Officer of the Company ( Service Options ).

As summarised in Section 3.2 above, Listing Rule 7.1 limits the amount of equity securities that a listed company can issue without the approval of its shareholders over any 12-month period to 15% of the fully paid ordinary shares it had on issue at the start of that period. The proposed issue of the Service Options does not fit within any of the exceptions set out in Listing Rule 7.2.

While the issue does not exceed the 15% limit in Listing Rule 7.1 and can therefore be made without breaching that rule, the Company wishes to retain as much flexibility as possible to issue additional equity securities in the future without having to obtain Shareholder approval under Listing Rule 7.1. Accordingly, the Company is seeking Shareholder approval pursuant to Listing Rule 7.1 so that it does not use up any of its 15% placement capacity under Listing Rule 7.1.

7.2 Technical information required by Listing Rule 14.1A

If Resolution 9 is passed, the Company will be able to proceed with the issue of the Service Options. In addition, the issue of the Service Options will be excluded from the calculation of the number of equity securities that the Company can issue without Shareholder approval under Listing Rule 7.1.

If Resolution 9 is not passed, the issue of the Service Options can still proceed but it will reduce, to that extent, the Company’s capacity to issue equity securities without Shareholder approval under Listing Rule 7.1 for 12 months following the issue.

Resolution 9 seeks Shareholder approval for the purposes of Listing Rule 7.1 for the issue of the Service Options.

7.3 Technical information required by Listing Rule 7.1

Pursuant to and in accordance with Listing Rule 7.3, the following information is provided in relation to Resolution 9:

  • (a) the Service Options will be issued to Alistair McCall;

  • (b) in accordance with paragraph 7.2 of ASX Guidance Note 21, the Company confirms that Mr McCall is not:

  • (i) a related party of the Company, a member of the Company’s Key Management Personnel, a substantial holder of the Company, an advisers to the Company or an associate of any of these parties; and

(ii) being issued more than 1% of the issued capital of the Company;

  • (c) the maximum number of Service Options to be issued is 4,000,000;

  • (d) The terms and conditions of the Service Options are set out in Schedule 1;

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  • (e) the Service Options will be issued no later than three (3) months after the date of the Meeting (or such later date to the extent permitted by any ASX waiver or modification of the Listing Rules) and it is intended that issue of the Service Options will occur on the same date;

  • (f) the Service Options will be issued at a nil issue price, in consideration for Chief Data Officer services provided by Alistair McCall;

  • (g) the purpose of the issue of the Service Options is to is to provide a performance linked incentive component in the remuneration package for the recipients of the Service Options to more closely align the interests of Mr McCall with those of Shareholders, to motivate and reward the performance of Mr McCall in his role as Chief Data Officer and to provide a cost effective way from the Company to remunerate Mr McCall, which will allow the Company to spend a greater proportion of its cash reserves on its operations than it would if alternative cash forms of remuneration were given to Alistair McCall;

  • (h) the Service Options are not being issued under an agreement; and

  • (i) the Service Options are not being issued under, or to fund, a reverse takeover.

8. RESOLUTION 10 – ADOPTION OF INCENTIVE OPTION PLAN

8.1 General

Resolution 10 seeks Shareholder approval for the adoption of the employee incentive scheme titled “Incentive Option Plan” ( Option Plan ) and for the issue of Options under the Option Plan in accordance with Listing Rule 7.2 (Exception 13(b)).

The objective of the Option Plan is to attract, motivate and retain key employees and the Company considers that the adoption of the Option Plan and the future issue of Options under the Option Plan will provide selected employees with the opportunity to participate in the future growth of the Company.

8.2 Listing rule 7.2 (Exception 13(b))

As summarised in Section 3.2 above, Listing Rule 7.1 limits the amount of equity securities that a listed company can issue without the approval of its shareholders over any 12-month period to 15% of the fully paid ordinary shares it had on issue at the start of that period.]

Listing Rule 7.2 (Exception 13(b)) provides that Listing Rule 7.1 does not apply to an issue of securities under an employee incentive scheme if, within three years before the date of issue of the securities, the holders of the entity’s ordinary securities have approved the issue of equity securities under the scheme as exception to Listing Rule 7.1.

Exception 13(b) is only available if and to the extent that the number of equity securities issued under the scheme does not exceed the maximum number set out in the entity’s notice of meeting dispatched to shareholders in respect of the meeting at which shareholder approval was obtained pursuant to Listing Rule 7.2 (Exception 13(b). Exception 13(b) also ceases to be available if there is a material change to the terms of the scheme from those set out in the notice of meeting.

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If Resolution 10 is passed, the Company will be able to issue Options under the Option Plan to eligible participants over a period of 3 years. The issue of any Options to eligible participants under the Option Plan (up to the maximum number of Options stated in Section 8.3(c) below) will be excluded from the calculation of the number of equity securities that the Company can issue without Shareholder approval under Listing Rule 7.1.

For the avoidance of doubt, the Company must seek Shareholder approval under Listing Rule 10.14 in respect of any future issues of Options under the Option Plan to a related party or a person whose relationship with the Company or the related party is, in ASX’s opinion, such that approval should be obtained.

If Resolution 10 is not passed, the Company will be able to proceed with the issue of Options under the Option Plan to eligible participants, but any issues of Options will reduce, to that extent, the Company’s capacity to issue equity securities without Shareholder approval under Listing Rule 7.1 for the 12-month period following the issue of the Options.

8.3 Technical information required by Listing Rule 7.2 (Exception 13)

Pursuant to and in accordance with Listing Rule 7.2 (Exception 13), the following information is provided in relation to Resolution 10:

  • (a) a summary of the key terms and conditions of the Option Plan is set out in Schedule 2;

  • (b) the Company has not issued any Options under the Option Plan as this is the first time that Shareholder approval is being sought for the adoption of the Option Plan; and

  • (c) the maximum number of Securities proposed to be issued under the Option Plan, following Shareholder approval, is 9,000,000 Options. It is not envisaged that the maximum number of Securities for which approval is sought will be issued immediately.

9. RESOLUTION 11 – APPROVAL OF 7.1A MANDATE

9.1 General

Broadly speaking, and subject to a number of exceptions, Listing Rule 7.1 limits the amount of Equity Securities that a listed company can issue without the approval of its shareholders over any 12-month period to 15% of the fully paid ordinary securities it had on issue at the start of that period.

However, under Listing Rule 7.1A, an eligible entity may seek shareholder approval by way of a special resolution passed at its annual general meeting to increase this 15% limit by an extra 10% to 25% ( 7.1A Mandate ).

An ‘eligible entity’ means an entity which is not included in the S&P/ASX 300 Index and has a market capitalisation of $300,000,000 or less. The Company is an eligible entity for these purposes.

As at the date of this Notice, the Company is an eligible entity as it is not included in the S&P/ASX 300 Index and has a current market capitalisation of $6,840,000 (based on the number of Shares on issue and the closing price of Shares on the ASX on 11 October 2021.

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Resolution 11 seeks Shareholder approval by way of special resolution for the Company to have the additional 10% placement capacity provided for in Listing Rule 7.1A to issue Equity Securities without Shareholder approval.

If Resolution 11 is passed, the Company will be able to issue Equity Securities up to the combined 25% limit in Listing Rules 7.1 and 7.1A without any further Shareholder approval.

If Resolution 11 is not passed, the Company will not be able to access the additional 10% capacity to issue Equity Securities without Shareholder approval under Listing Rule 7.1A, and will remain subject to the 15% limit on issuing Equity Securities without Shareholder approval set out in Listing Rule 7.1.

9.2 Technical information required by Listing Rule 7.1A

Pursuant to and in accordance with Listing Rule 7.3A, the information below is provided in relation to Resolution 11:

(a) Period for which the 7.1A Mandate is valid

The 7.1A Mandate will commence on the date of the Meeting and expire on the first to occur of the following:

  • (i) the date that is 12 months after the date of this Meeting;

  • (ii) the time and date of the Company’s next annual general meeting; and

  • (iii) the time and date of approval by Shareholders of any transaction under Listing Rule 11.1.2 (a significant change in the nature or scale of activities) or Listing Rule 11.2 (disposal of the main undertaking).

(b) Minimum price

Any Equity Securities issued under the 7.1A Mandate must be in an existing quoted class of Equity Securities and be issued at a minimum price of 75% of the volume weighted average price of Equity Securities in that class, calculated over the 15 trading days on which trades in that class were recorded immediately before:

  • (i) the date on which the price at which the Equity Securities are to be issued is agreed by the entity and the recipient of the Equity Securities; or

  • (ii) if the Equity Securities are not issued within 10 trading days of the date in Section 9.2(b)(i), the date on which the Equity Securities are issued.

(c) Use of funds raised under the 7.1A Mandate

The Company intends to use funds raised from issues of Equity Securities under the 7.1A Mandate for expenses associated with the Frugl Groceries App, marketing activities and general working capital.

  • (d) Risk of Economic and Voting Dilution

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Any issue of Equity Securities under the 7.1A Mandate will dilute the interests of Shareholders who do not receive any Shares under the issue.

If Resolution 11 is approved by Shareholders and the Company issues the maximum number of Equity Securities available under the 7.1A Mandate, the economic and voting dilution of existing Shares would be as shown in the table below.

The table below shows the dilution of existing Shareholders calculated in accordance with the formula outlined in Listing Rule 7.1A.2, on the basis of the closing market price of Shares and the number of Equity Securities on issue or proposed to be issued as at 11 October 2021.

The table also shows the voting dilution impact where the number of Shares on issue (Variable A in the formula) changes and the economic dilution where there are changes in the issue price of Shares issued under the 7.1A Mandate.

Dilution Dilution
Number of Shares on Issue
(Variable A in Listing Rule
7.1A.2)		 Shares
issued –
10%
voting
dilution		 Issue Price
$0.018 $0.037 $0.054
50%
decrease		 Issue
Price		 50%
increase
Funds Raised
Current 180,000,000
Shares		 18,000,000
Shares		 $324,000 $666,000 $972,000
50% increase 270,000,000
Shares		 27,000,000
Shares		 $486,000 $999,000 $1,458,000
100%
increase		 360,000,000
Shares		 36,000,000
Shares		 $648,000 $1,332,00 $1,944,000

*The number of Shares on issue (Variable A in the formula) could increase as a result of the issue of Shares that do not require Shareholder approval (such as under a prorata rights issue or scrip issued under a takeover offer) or that are issued with Shareholder approval under Listing Rule 7.1.

The table above uses the following assumptions:

  1. There are currently 180,000,000 Shares on issue.

  2. The issue price set out above is the closing market price of the Shares on the ASX on 18 October 2021 being $0.0370.

  3. The Company issues the maximum possible number of Equity Securities under the 7.1A Mandate.

  4. The Company has not issued any Equity Securities in the 12 months prior to the Meeting that were not issued under an exception in Listing Rule 7.2 or with approval under Listing Rule 7.1.

  5. The issue of Equity Securities under the 7.1A Mandate consists only of Shares. It is assumed that no Options are exercised into Shares before the date of issue of the Equity Securities. If the issue of Equity Securities includes quoted Options, it is assumed that those quoted Options are exercised into Shares for the purpose of calculating the voting dilution effect on existing Shareholders.

  6. The calculations above do not show the dilution that any one particular Shareholder will be subject to. All Shareholders should consider the dilution caused to their own shareholding depending on their specific circumstances.

  7. This table does not set out any dilution pursuant to approvals under Listing Rule 7.1 unless otherwise disclosed.

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  1. The 10% voting dilution reflects the aggregate percentage dilution against the issued share capital at the time of issue. This is why the voting dilution is shown in each example as 10%.

  2. The table does not show an example of dilution that may be caused to a particular Shareholder by reason of placements under the 7.1A Mandate, based on that Shareholder’s holding at the date of the Meeting.

Shareholders should note that there is a risk that:

  • (i) the market price for the Company’s Shares may be significantly lower on the issue date than on the date of the Meeting; and

  • (ii) the Shares may be issued at a price that is at a discount to the market price for those Shares on the date of issue.

(e) Allocation policy under the 7.1A Mandate

The recipients of the Equity Securities to be issued under the 7.1A Mandate have not yet been determined. However, the recipients of Equity Securities could consist of current Shareholders or new investors (or both), none of whom will be related parties of the Company.

The Company will determine the recipients at the time of the issue under the 7.1A Mandate, having regard to the following factors:

  • (i) the purpose of the issue;

  • (ii) alternative methods for raising funds available to the Company at that time, including, but not limited to, an entitlement issue, share purchase plan, placement or other offer where existing Shareholders may participate;

  • (iii) the effect of the issue of the Equity Securities on the control of the Company;

  • (iv) the circumstances of the Company, including, but not limited to, the financial position and solvency of the Company;

  • (v) prevailing market conditions; and

  • (vi) advice from corporate, financial and broking advisers (if applicable).

(f) Previous approval under Listing Rule 7.1A

The Company previously obtained approval from its Shareholders pursuant to Listing Rule 7.1A at its annual general meeting held on 30 November 2020 ( Previous Approval ).

During the 12-month period preceding the date of the Meeting, being on and from 19 November 2021, the Company issued 16,000,000 Shares pursuant to the Previous Approval ( Previous Issue ), which represent approximately 8.88% of the total diluted number of Equity Securities on issue in the Company on 19 November 2020, which was 123,750,000.

Further details of the issues of Equity Securities by the Company pursuant to Listing Rule 7.1A.2 during the 12-month period preceding the date of the Meeting are set out below.

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The following information is provided in accordance with Listing Rule 7.3A.6(b) in respect of the Previous Issue:

Date of Issue and
Appendix 2A		 Date of Issue: 19 July 2021
Date of Appendix 2A: 19 July 2021
Recipients Professional and sophisticated investors as part of a
placement announced on 19 July 2021. The placement
participants were identified through a bookbuild process,
which involved the Company seeking expressions of
interest to participate in the placement from non-related
parties of the Company.
Number and Class of
Equity Securities
Issued		 16,000,000 Shares
Issue Price and
discount to Market
Price1 (if any)		 $0.05 per Share (at a discount 1.2% to Market Price).
Total Cash
Consideration and
Use of Funds		 Amount raised: $825,000
Amount spent: $443,912
Use of funds: Development of a new version of the Frugl
Groceries App and ongoing working capital.
Amount remaining: $381,088
Proposed use of remaining funds1: Completion of the
new version of the Frugl Groceries App and ongoing
working capital.

Notes:

  1. This is a statement of current intentions as at the date of this Notice. As with any budget, intervening events and new circumstances have the potential to affect the manner in which the funds are ultimately applied. The Board reserves the right to alter the way the funds are applied on this basis.

9.3 Voting Exclusion Statement

As at the date of this Notice, the Company is not proposing to make an issue of Equity Securities under Listing Rule 7.1A. Accordingly, a voting exclusion statement is not included in this Notice.

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GLOSSARY

  • $ means Australian dollars.

  • 7.1A Mandate has the meaning given in Section 9.1.

Annual General Meeting or Meeting means the meeting convened by the Notice.

ASIC means the Australian Securities & Investments Commission.

ASX means ASX Limited (ACN 008 624 691) or the financial market operated by ASX Limited, as the context requires.

Board means the current board of directors of the Company.

Business Day means Monday to Friday inclusive, except New Year’s Day, Good Friday, Easter Monday, Christmas Day, Boxing Day, and any other day that ASX declares is not a business day.

Chair means the chair of the Meeting.

Closely Related Party of a member of the Key Management Personnel means:

  • (a) a spouse or child of the member;

  • (b) a child of the member’s spouse;

  • (c) a dependent of the member or the member’s spouse;

  • (d) anyone else who is one of the member’s family and may be expected to influence the member, or be influenced by the member, in the member’s dealing with the entity;

  • (e) a company the member controls; or

  • (f) a person prescribed by the Corporations Regulations 2001 (Cth) for the purposes of the definition of ‘closely related party’ in the Corporations Act.

Company means Frugl Group Limited (ACN 096 870 978).

Constitution means the Company’s constitution.

Corporations Act means the Corporations Act 2001 (Cth).

Directors means the current directors of the Company.

Equity Securities includes a Share, a right to a Share or Option, an Option, a convertible security and any security that ASX decides to classify as an Equity Security.

Explanatory Statement means the explanatory statement accompanying the Notice.

Key Management Personnel has the same meaning as in the accounting standards issued by the Australian Accounting Standards Board and means those persons having authority and responsibility for planning, directing and controlling the activities of the Company, or if the Company is part of a consolidated entity, of the consolidated entity, directly or indirectly, including any director (whether executive or otherwise) of the Company, or if the Company is part of a consolidated entity, of an entity within the consolidated group.

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Listing Rules means the Listing Rules of ASX.

Notice or Notice of Meeting means this notice of meeting including the Explanatory Statement and the Proxy Form.

Option means an option to acquire a Share.

Optionholder means a holder of an Option.

Proxy Form means the proxy form accompanying the Notice.

Remuneration Report means the remuneration report set out in the Director’s report section of the Company’s annual financial report for the year ended 30 June 2021.

Resolutions means the resolutions set out in the Notice, or any one of them, as the context requires.

Section means a section of the Explanatory Statement.

Share means a fully paid ordinary share in the capital of the Company.

Shareholder means a registered holder of a Share.

Variable A means “A” as set out in the formula in Listing Rule 7.1A.2.

WST means Western Standard Time as observed in Perth, Western Australia.

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SCHEDULE 1 – TERMS AND CONDITIONS OF CAPITAL RAISING OPTIONS, THE DIRCTOR OPTIONS AND THE SERVICE OPTIONS

1. Entitlement

Each Option entitles the holder to subscribe for one Share upon exercise of the Option.

2. Exercise Price

Subject to paragraph 10, the amount payable upon exercise of each Option will be $0.10 ( Exercise Price )

3. Expiry Date

Each Option will expire at 5:00 pm (WST) on 20 July 2024 ( Expiry Date ). An Option not exercised before the Expiry Date will automatically lapse on the Expiry Date.

4. Exercise Period

The Options are exercisable at any time on or prior to the Expiry Date ( Exercise Period ).

5. Notice of Exercise

The Options may be exercised during the Exercise Period by notice in writing to the Company in the manner specified on the Option certificate ( Notice of Exercise ) and payment of the Exercise Price for each Option being exercised in Australian currency by electronic funds transfer or other means of payment acceptable to the Company.

6. Exercise Date

A Notice of Exercise is only effective on and from the later of the date of receipt of the Notice of Exercise and the date of receipt of the payment of the Exercise Price for each Option being exercised in cleared funds ( Exercise Date ).

7.

Timing of issue of Shares on exercise

Within 15 Business Days after the Exercise Date, the Company will:

  • (a) allot and issue the number of Shares required under these terms and conditions in respect of the number of Options specified in the Notice of Exercise and for which cleared funds have been received by the Company;

  • (b) if required, give ASX a notice that complies with section 708A(5)(e) of the Corporations Act, or, if the Company is unable to issue such a notice, lodge with ASIC a prospectus prepared in accordance with the Corporations Act and do all such things necessary to satisfy section 708A(11) of the Corporations Act to ensure that an offer for sale of the Shares does not require disclosure to investors; and

  • (c) if admitted to the official list of ASX at the time, apply for official quotation on ASX of Shares issued pursuant to the exercise of the Options.

If a notice delivered under 7(b) for any reason is not effective to ensure that an offer for sale of the Shares does not require disclosure to investors, the Company

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must, no later than 20 Business Days after becoming aware of such notice being ineffective, lodge with ASIC a prospectus prepared in accordance with the Corporations Act and do all such things necessary to satisfy section 708A(11) of the Corporations Act to ensure that an offer for sale of the Shares does not require disclosure to investors.

8. Shares issued on exercise

Shares issued on exercise of the Options rank equally with the then issued shares of the Company.

9. Quotation of Shares issued on exercise

If admitted to the official list of ASX at the time, application will be made by the Company to ASX for quotation of the Shares issued upon the exercise of the Options.

10. Reconstruction of capital

If at any time the issued capital of the Company is reconstructed, all rights of an Optionholder are to be changed in a manner consistent with the Corporations Act and the ASX Listing Rules at the time of the reconstruction.

11. Participation in new issues

There are no participation rights or entitlements inherent in the Options and holders will not be entitled to participate in new issues of capital offered to Shareholders during the currency of the Options without exercising the Options.

12. Change in exercise price

An Option does not confer the right to a change in Exercise Price or a change in the number of underlying securities over which the Option can be exercised.

13. Transferability

The Options are transferable subject to any restriction or escrow arrangements imposed by ASX or under applicable Australian securities laws.

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SCHEDULE 2 – TERMS AND CONDITIONS OF INCENTIVE OPTION PLAN

The material terms of the Incentive Option Plan ( Option Plan ) are summarised below:

  • (a) Eligibility : Participants in the Option Plan may be:

  • (i) a Director (whether executive or non-executive) of the Company and any Associated Body Corporate of the Company (each, a Group Company );

  • (ii) a full or part time employee of any Group Company;

  • (iii) a casual employee or contractor of a Group Company to the extent permitted by ASIC Class Order 14/1000 as amended or replaced ( Class Order ); or

  • (iv) a prospective participant, being a person to whom the offer is made but who can only accept the offer if an arrangement has been entered into that will result in the person becoming a participant under subparagraphs (i), (ii), or (iii) above,

who is declared by the Board to be eligible to receive grants of Options under the Option Plan ( Eligible Participant ).

  • (b) Offer: The Board may, from time to time, in its absolute discretion, make a written offer to any Eligible Participant to apply for up to a specified number of Options, upon the terms set out in the Option Plan and upon such additional terms and conditions as the Board determines.

  • (c) Plan limit: The Company must have reasonable grounds to believe, when making an offer, that the number of Shares to be received on exercise of Options offered under an offer, when aggregated with the number of Shares issued or that may be issued as a result of offers made in reliance on the Class Order at any time during the previous 3 year period under an employee incentive scheme covered by the Class Order or an ASIC exempt arrangement of a similar kind to an employee incentive scheme, will not exceed 5% of the total number of Shares on issue at the date of the offer.

  • (d) Issue price: Unless the Options are quoted on the ASX, Options issued under the Option Plan will be issued for no more than nominal cash consideration.

  • (e) Exercise price : The Board may determine the Option exercise price (if any) for an Option offered under that Offer in its absolute discretion. To the extent the Listing Rules specify or require a minimum price, the Option exercise price must not be less than any minimum price specified in the Listing Rules.

  • (f) Vesting conditions: An Option may be made subject to vesting conditions as determined by the Board in its discretion and as specified in the offer for the Option ( Vesting Conditions ).

  • (g) Vesting : The Board may in its absolute discretion except in respect of a change of control occurring where Vesting Conditions are deemed to be automatically waived by written notice to a Participant (being an Eligible Participant to whom Options have been granted under the Option Plan or their nominee where the Options have been granted to the nominee of the Eligible Participant ( Relevant Person )), resolve to waive any of the Vesting Conditions applying to Options due to:

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  • (i) special circumstances arising in relation to a Relevant Person in respect of those Options, being:

  • (A) a Relevant Person ceasing to be an Eligible Participant due to:

    • (I) death or total or permanent disability of a Relevant Person; or

    • (II) retirement or redundancy of a Relevant Person;

  • (B) a Relevant Person suffering severe financial hardship;

  • (C) any other circumstance stated to constitute “special circumstances” in the terms of the relevant offer made to and accepted by the Participant; or

  • (D) any other circumstances determined by the Board at any time (whether before or after the offer) and notified to the relevant Participant which circumstances may relate to the Participant, a class of Participant, including the Participant or particular circumstances or class of circumstances applying to the Participant,

(Special Circumstances), or

  • (ii) a change of control occurring; or

  • (iii) the Company passing a resolution for voluntary winding up, or an order is made for the compulsory winding up of the Company.

  • (h) Lapse of an Option : An Option will lapse upon the earlier to occur of:

  • (i) an unauthorised dealing in, or hedging of, the Option occurring;

  • (ii) a Vesting Condition in relation to the Option is not satisfied by its due date, or becomes incapable of satisfaction, as determined by the Board in its absolute discretion, unless the Board exercises its discretion to waive the Vesting Conditions and vest the Option in the circumstances set out in paragraph (g) or the Board resolves, in its absolute discretion, to allow the unvested Options to remain unvested after the Relevant Person ceases to be an Eligible Participant;

  • (iii) in respect of unvested Option only, a Relevant Person ceases to be an Eligible Participant, unless the Board exercises its discretion to vest the Option in the circumstances set out in paragraph (g) or the Board resolves, in its absolute discretion, to allow the unvested Options to remain unvested after the Relevant Person ceases to be an Eligible Participant;

  • (iv) in respect of vested Options only, a Relevant Person ceases to be an Eligible Participant and the Options granted in respect of that Relevant Person are not exercised within one (1) month (or such later date as the Board determines) of the date that Relevant Person ceases to be an Eligible Participant;

  • (v) the Board deems that an Option lapses due to fraud, dishonesty or other improper behaviour of the Eligible Participant;

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  • (vi) the Company undergoes a change of control or a winding up resolution or order is made and the Board does not exercise its discretion to vest the Option; and

  • (vii) the expiry date of the Option.

  • (i) Not transferrable : Subject to the Listing Rules, Options are only transferrable in Special Circumstances with the prior written consent of the Board (which may be withheld in its absolute discretion) or by force of law upon death, to the Participant’s legal personal representative or upon bankruptcy to the participant’s trustee in bankruptcy.

  • (j) Shares : Shares resulting from the exercise of the Options shall, subject to any sale restrictions (refer to paragraph (k)), from the date of issue, rank on equal terms with all other Shares on issue.

  • (k) Sale restrictions : The Board may, in its discretion, determine at any time up until exercise of Options, that a restriction period will apply to some or all of the Shares issued to a Participant on exercise of those Options ( Restriction Period ). In addition, the Board may, in its sole discretion, having regard to the circumstances at the time, waive any such Restriction Period.

  • (l) Quotation of Shares: If Shares of the same class as those issued upon exercise of Options issued under the Option Plan are quoted on the ASX, the Company will, subject to the Listing Rules, apply to the ASX for those Shares to be quoted on ASX within 10 business days of the later of the date the Shares are issued and the date any Restriction Period applying to the disposal of Shares ends. The Company will not apply for quotation of any Options on the ASX.

  • (m) No participation rights: There are no participation rights or entitlements inherent in the Options and Participants will not be entitled to participate in new issues of capital offered to Shareholders during the currency of the Options without exercising the Options.

  • (n) Change in exercise price or number of underlying securities: An Option does not confer the right to a change in exercise price or in the number of underlying Shares over which the Option can be exercised.

  • (o) Reorganisation: If, at any time, the issued capital of the Company is reorganised (including consolidation, subdivision, reduction or return), the terms of the Options will be changed in a manner consistent with the Corporations Act and the Listing Rules at the time of the reorganisation.

  • (p) Amendments: Subject to express restrictions set out in the Option Plan and complying with the Corporations Act, Listing Rules and any other applicable law, the Board may, at any time, by resolution amend or add to all or any of the provisions of the Option Plan, or the terms or conditions of any Option granted under the Option Plan including giving any amendment retrospective effect.

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