MOTIO LTD — M&A Activity 2022

Mar 15, 2022

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March 16, 2022

Market Announcements Platform ASX Limited

Motio acquires UK Software firm Liquid Thinking – Strengthening Motio’s sports software and payment business ready to capitalise on its growth potential.

Highlights

• Motio has acquired UK based Liquid Thinking Limited

• Motio currently represents Liquid Thinking (owner of the Spawtz Software) in Australia

• Operating in Australia, United Kingdom, New Zealand and South Africa

• Owns and operates the Spawtz software and payments platform specialising in indoor and team sports

• Deepens our capability and utility into the indoor and team sports environments

• Strategically important for long term growth

• Attractive valuation on the initial consideration of ~1.5x Annual Recurring Revenue contract value; Total consideration of up to AUD$750,000AUD (comprised of AUD$375,000 in MXO Scrip and AUD$375,000 in cash) with up to $600,000 in deferred scrip consideration based on achievement of revenue growth milestones

• Funded utilising existing cash reserves & EBITDA accretive in the FY23 year

Motio Limited (ASX:MXO or “Motio”) has today announced it has acquired 100% of UK based Liquid Thinking Limited (owner of the Spawtz Software operated in Australia by Motio under license) which also operates through licensees in South Africa and New Zealand.

Liquid Thinking’s portfolio of customers and technology focusses on delivering end-to-end player registration, competition management and payments for Indoor Sports Centres, Sporting Associations and Leagues across the UK, Australia, South Africa and New Zealand. Its primary revenue is recurring Software as a Service (SaaS) and emerging revenue through fees from facilitating online and cashless payments.

Liquid Thinking’s software is used extensively across these growing environments encompassing more than 900 venues and interacting with over 750,000 players across the aforementioned markets. The acquisition of Liquid Thinking will provide Motio with continuing opportunity to deepen its capabilities in Australia and broaden its footprint across key markets, specifically the UK and New Zealand. The acquisition serves as a powerful and significant change in its leadership within indoor sports across Australia offering a suite of options for operators as it continues its driving force as an Audience Experience and Digital Place-Based media company .

Motio has successfully represented the Spawtz software within these environments for a number of years (previously as Adline Media prior to Motio’s acquisition in January 2020) and has a strong working relationship with Liquid Thinking. Together, the companies have continued to operate and develop a growing payments business within the sports and team environments.

Michael Johnstone, Chief Operating Officer

“Some might say this acquisition was inevitable given the long-term commercial relationship Motio has with Liquid Thinking and the obvious benefit that the acquisition provides in terms of margin flow through. Furthering our relationship with Liquid Thinking to a management and leadership role together with our existing collaborative strength under one roof, albeit it from the UK, provides a fresh new set of opportunities. We are excited about the growth possibilities that this acquisition presents in Australia and international markets”.

MOTIO LIMITED | LEVEL 15, 189 KENT STREET SYDNEY NSW 2000 | P +61 2 7227 2277 | ACN 147 799 951

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Matthew Davies, Managing Director, Liquid Thinking

“We’ve worked together for a long time and since working closely with MJ, Adam, Brett and the team, Australia has become our most successful market. Liquid Thinking is a small team doing great work and I’m really proud of what we have achieved. The next phase is equally exciting for us. The Liquid Thinking team are great at what we do, and Motio have worked so positively with us over the years that it already feels like we’re part of the team, ready to combine our disciplines and continue to transform Spawtz ”.

About Liquid Thinking

Liquid Thinking generates revenues from the deployment of league and venue management software to indoor sporting centres and sports associations in the UK, Australia, New Zealand and South Africa via recurring SaaS fees and payments revenue. This software delivers utility and provides efficiencies to venue operators and competition managers via scheduling, automation of fixtures, court bookings, real time online scoring and statistics and facilitating online payments where people play for fun.

Revenue

Liquid Thinking’s annual recurring revenue run rate is approximately AUD$500,000 (which includes AUD$160,000 from Motio with Motio currently receiving ~60% of the licence fees for revenue generated in Australia) based on YTD January 31,2022 Management Accounts. In addition to increased revenue, it will provide Motio the opportunity to expand its offering and provide valuable Business Development strategy and expertise to grow the platforms detailed below.

Why Liquid Thinking

Motio’s Audience Experience strategy is positively changing our relationships with Brands, agencies and importantly our commercial partners. Our long-term relationship with Liquid Thinking through our exclusive representation with the Spawtz platform (as already detailed above) has enabled Motio to provide a true “couch to court” Audience Experience . This has included Player registrations, competition and league management which are directly integrated to Motio’s Centre Information Displays allowing players to see game information on location, brands to interact with players and centres to create a better experience for players on and off court.

The acquisition will enable Motio to take a leadership role across the product development and growth of Spawtz to further strengthen our Audience Experience platform within our Motio Play environments including:

• Transforming our relationship with Liquid Thinking to deeply collaborate on Audience Experience initiatives

• Extend and accelerate Motio’s capability and utility into the indoor and team sports environments

• Creating a step change at the inflection point for Payments revenue

• Providing the opportunity to expand Motio’s client base in the UK and NZ using our proven and successful Business Development experience

• Enable the Liquid Thinking team to focus on Product Development, allowing Motio to apply its sales and professional management to our existing collaboration

Spawtz Software

The Spawtz software is a system that is built by players for players . It has revolutionised a sector of the indoor, grass roots and amateur sports facilities in key markets in Australia, UK, New Zealand and South Africa to enable operators to operate their business and enhance the player experience.

The Spawtz Features/Ecosystem include:

• Player Registration & Data management

• Competition & League Management

• Live Scoring and Scoreboard System

• Online Bookings & Calendar

• Online Payments

• Player Communication (email & SMS) & Social Media

MOTIO LIMITED | LEVEL 15, 189 KENT STREET SYDNEY NSW 2000 | P +61 2 7227 2277 | ACN 147 799 951

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Existing and emerging payments

Spawtz has changed the operational efficiency of Indoor Sports Centres, Sporting Associations and Leagues across the UK, Australia, South Africa and New Zealand over the past 10 years. These organisations have seen an evolution of ownership including a shift towards professional management, improved operations, and enhanced customer experience.

Over the past three years, Motio and Liquid Thinking have developed, rolled out and integrated Online Payment products to Spawtz clients specifically in the UK and Australia. The Spawtz payment products have developed in “the way people are used to paying”, transforming the existing universe of cash-based payments to digital transactions. These developments have provided Spawtz customers and players the opportunity to transact more efficiently and the player experience vastly increased. It has also provided operators an ability to reduce or eliminate lost or “forgotten” payments removing cash handling and improving payment tracking.

The Spawtz payment product and features generate additional transactional revenue to complement the existing Spawtz SaaS revenue. Since its introduction both Motio and Liquid Thinking have seen:

• Online Payments take up by Spawtz clients grown considerably, accelerated by Covid’s impact on cashless transactions

• Player payment adoption increasing significantly Season on Season

• Increasing demand has led to the development and launch of enhanced features to the platform such as

• Shared Payments (splitting fees between players)

• Automated Weekly payments (full season payments paid weekly)

Innovations to the existing platform will continue to develop with the express goal to drive incremental payments revenue and increase the user experience.

Our Strategy

• Leverage Motio’s proven Business Development and Client Acquisition experience to expand client base on the UK and New Zealand harnessing Motio’s Business Development expertise.

• Continue roll out Online Payment platform across all existing Spawtz client base.

• Increase adoption of Online Payment functionally across player universe.

• Review Product Development Roadmap and align to Audience Experience and Revenue Growth channels.

Liquid Thinking’s Managing Director Matthew Davies will remain an employee with the business post acquisition, continuing to lead the UK operations and product development.

Motio anticipates that post the Liquid Thinking acquisition Software and Payments related revenue from the combined entities will contribute between AUD$1.0M and AUD$1.2M in revenues within the FY23.

The acquisition is expected to be EBITDA accretive in the FY23 year.

MOTIO LIMITED | LEVEL 15, 189 KENT STREET SYDNEY NSW 2000 | P +61 2 7227 2277 | ACN 147 799 951

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Acquisition Material Terms

Motio has entered into a binding agreement to acquire all the issued capital of Liquid Thinking on the following material terms:

• AUD$375,000 cash (funded through Motio’s existing cash reserves);

• Up to 4,125,000 ordinary shares comprised:

• 3,750,000 shares issued upon completion (escrowed for 12 months from date of completion) at a deemed issue price of $0.10 per share issued pursuant to Motio’s existing ASX Listing Rule 7.1 capacity; and

• 375,000 shares if, in the event the MXO 30-day VWAP is less than or equal to $0.09 per share within 60 days of completion issued pursuant to Motio’s existing ASX Listing Rule 7.1 capacity (escrowed for 12 months from date of completion).

Up to AUD$600,000 in cash or shares at Motio’s option (issued pursuant to Motio’s existing ASX Listing Rule 7.1 capacity) across three tranches:

• Tranche 1 : If, for the financial year ending 30 June 2022 or the financial year ending 30 June 2023, as the case may be, Liquid Thinking achieves more than GPB£200,000 in total revenue from customers (excluding customers in Australia) Motio agrees to pay the Vendor AUD$200,000 cash or issue to the Vendor AUD$200,000 worth of Motio Shares as calculated based on the 30-day VWAP in MXO shares, at the absolute discretion of Motio.

• Tranche 2 : If, for the financial year ending 30 June 2023 or the financial year ending 30 June 2024, as the case may be, Liquid Thinking achieves between AUD$977,501 and AUD$1,150,000 in Total Gross Software and Payments Revenue[1] , Motio shall pay the Vendor AUD$200,000 cash or issue to the Vendor AUD$200,000 worth of Motio Shares as calculated based on the 30-day VWAP in MXO shares, at the absolute discretion of Motio. In the event Liquid Thinking achieves between AUD$977,501 and AUD$1,150,000 in Total Gross Software and Payments Revenue, the cash amount/value of MXO Shares shall be calculated as follows:

A= (TR/1,150,000) X AUD$200,000

Where:

A is the AUD amount or value of Motio Shares; and

TR is the Total Gross Software Payments Revenue for the applicable financial year.

• Tranche 3 : If for the financial year ending 30 June 2024 or 30 June 2025, as applicable, Liquid Thinking achieves between AUD$1,080,001 and AUD$1,350,000 in Total Gross Software and Payments Revenue, Motio shall pay the Vendor AUD$200,000 cash or issue to the Vendor the equivalent value of MXO Shares as calculated based on the 30-day VWAP in MXO shares, at the absolute discretion of Motio. In the event Liquid Thinking achieves between AUD$1,080,001 and AUD$1,350,000 in Total Gross Software and Payments Revenue, the cash amount/value of MXO Shares shall be calculated as follows:

A= (TR/1,350,000) X AUD$200,000

Where:

1 Means all revenue generated by Liquid Thinking from the Spawtz software.

MOTIO LIMITED | LEVEL 15, 189 KENT STREET SYDNEY NSW 2000 | P +61 2 7227 2277 | ACN 147 799 951

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A is the AUD amount or value of Motio Shares; and

TR is the Total Gross Software Payments Revenue for the applicable financial year.

Motio anticipates completion to occur on or around 29 March 2022.

This announcement has been authorised for release by the Board.

ENDS.

Media & Investor Relations for the Liquid Thinking Acquisition

Michael Johnstone

Chief Operating Officer 0414 671 000 michael@motio.com.au

ABOUT MOTIO LIMITED

Motio is a leading Audience Experience & Digital Place-Based media company. It is focussed on creating engaging content & utility communication for brands, customers and its commercial partners across its expansive digital marketing environments. Its networks leverage long dwell time, delivering powerful, contextual connections to audiences, underpinned with first party data and location intelligence technology.

MOTIO LIMITED | LEVEL 15, 189 KENT STREET SYDNEY NSW 2000 | P +61 2 7227 2277 | ACN 147 799 951