QORIA LIMITED - Proxy Solicitation & Information Statement 2021

Family Zone Cyber Safety Limited ACN 167 509 177

NOTICE OF GENERAL MEETING

A general meeting of the Company will be held at 945 Wellington Street, West Perth on Wednesday 9 June 2021 at 9.00am (WST).

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 accountant, solicitor or other professional adviser prior to voting.

Should you wish to discuss any matter please do not hesitate to contact the Company Secretary on +61 8 9322 7600.

Family Zone Cyber Safety Limited ACN 167 509 177

NOTICE OF GENERAL MEETING

Notice is hereby given that a general meeting of Shareholders of Family Zone Cyber Safety Limited ( Company ) will be held at 945 Wellington Street, West Perth on Wednesday 9 June 2021 at 9.00am (WST) ( Meeting ).

The Explanatory Memorandum to this Notice provides additional information on matters to be considered at the Meeting. The Explanatory Memorandum and the Proxy Form form part of this Notice.

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 as Shareholders on 7 June 2021 at 5pm (WST).

Terms and abbreviations used in this Notice and Explanatory Memorandum are defined in Section 7.

AGENDA

1. Resolution 1 – Ratification of issue of Placement Shares under Listing Rule 7.1 capacity

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 approve and ratify the prior issue of 12,282,789 Placement Shares to the Placement Participants each at an issue price of $0.44 on the terms and conditions set out in the Explanatory Memorandum."

Voting Exclusion

The Company will disregard any votes cast in favour of this Resolution by or on behalf of the Placement Participants or any associates of those persons.

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

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

2. Resolution 2 – Ratification of issue of Placement Shares under Listing Rule 7.1A capacity

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 approve and ratify the prior issue of 33,171,756 Placement Shares to the Placement Participants each at an issue price of $0.44 on the terms and conditions set out in the Explanatory Memorandum."

Voting Exclusion

The Company will disregard any votes cast in favour of this Resolution by or on behalf of the Placement Participants or any associates of those persons.

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

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

3. Resolution 3 – Ratification of issue of Shares to Netsweeper

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 approve and ratify the prior issue of 680,680 Shares to Netsweeper on the terms and conditions set out in the Explanatory Memorandum."

Voting Exclusion

The Company will disregard any votes cast in favour of this Resolution by or on behalf of Netsweeper or any associates of Netsweeper.

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

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

4. Resolution 4 – Grant of Director Securities to Tim Levy

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 10.14 and for all other purposes, Shareholders approve the grant of up to:

(a) 1,000,000 STI 2022 Performance Rights;
(b) 1,000,000 STI 2023 Performance Rights;

(c) 1,500,000 LTI Performance Rights; and
(d) 1,500,000 Director Options (exercisable at $0.50 each on or before 30 June 2025), comprising 500,000 Tranche 1 Director Options (exercisable at $0.50 each on or before 30 June 2025), 500,000 Tranche 2 Director Options (exercisable at $0.50 each on or before 30 June 2025) and 500,000 Tranche 3 Director Options (exercisable at $0.50 each on or before 30 June 2025),

under the 2020 Plan to Tim Levy or his nominee on the terms and conditions set out in the Explanatory Memorandum.”

Voting Exclusion and Prohibition

The Company will disregard any votes cast in favour this Resolution by or on behalf of a Director who is eligible to participate in the 2020 Plan and their nominees or any associate of those persons.

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

(a) a person as proxy or attorney for a person who is entitled to vote on the Resolution, in accordance with 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.

In accordance with section 250BD of the Corporations Act, a vote on this Resolution must not be cast by a person appointed as a proxy, where that person is either a member of the Key Management Personnel or a Closely Related Party of such member. However, a vote may be cast by such person if the vote is not cast on behalf of a person who is otherwise excluded from voting, and

(a) the person is appointed as a proxy and the appointment specifies how the proxy is to vote; or
(b) the person appointed as proxy is the Chair and the appointment does not specify how the Chair is to vote but expressly authorises the Chair to exercise the proxy even if the Resolution is connected directly or indirectly with the remuneration of a member of the Key Management Personnel.

5. Resolution 5 – Grant of Director Performance Rights to Crispin Swan

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 10.14 and for all other purposes, Shareholders approve the grant of up to:

(a) 1,000,000 STI 2022 Performance Rights;
(b) 1,000,000 STI 2023 Performance Rights; and
(c) 1,500,000 LTI Performance Rights,

under the 2020 Plan to Crispin Swan or his nominee on the terms and conditions set out in the Explanatory Memorandum.”

Voting Exclusion and Prohibition

The Company will disregard any votes cast in favour this Resolution by or on behalf of a Director who is eligible to participate in the 2020 Plan and their nominees or any associate of those persons.

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

(a) a person as proxy or attorney for a person who is entitled to vote on the Resolution, in accordance with 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.

(a) the person is appointed as a proxy and the appointment specifies how the proxy is to vote; or
(b) the person appointed as proxy is the Chair and the appointment does not specify how the Chair is to vote but expressly authorises the Chair to exercise the proxy even if the Resolution is connected directly or indirectly with the remuneration of a member of the Key Management Personnel.

6. Resolution 6 – Grant of Director Options to Peter Pawlowitsch

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 10.14 and for all other purposes, Shareholders approve the grant of up to 3,000,000 Director Options exercisable at $0.50 each on or before 30 June 2025 comprising 750,000 Tranche 1 Director Options (exercisable at $0.50 each on or before 30 June 2025), 750,000 Tranche 2 Director Options (exercisable at $0.50 each on or before 30 June 2025) and 1,500,000 Tranche 3 Director Options (exercisable at $0.50 each on or before 30 June 2025) under the Company’s 2020 Plan to Peter Pawlowitsch or his nominee on the terms and conditions set out in the Explanatory Memorandum"

Voting Exclusion and Prohibition

The Company will disregard any votes cast in favour this Resolution by or on behalf of a Director who is eligible to participate in the 2020 Plan and their nominees or any associate of those persons.

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

(a) a person as proxy or attorney for a person who is entitled to vote on the Resolution, in accordance with 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.

(a) the person is appointed as a proxy and the appointment specifies how the proxy is to vote; or
(b) the person appointed as proxy is the Chair and the appointment does not specify how the Chair is to vote but expressly authorises the Chair to exercise the proxy even if the Resolution is connected directly or indirectly with the remuneration of a member of the Key Management Personnel.

7. Resolution 7– Approval of the Amendment to the terms of Existing Performance Rights issued to Directors and Senior Executives

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 6.23.4 and for all other purposes, Shareholders approve the amendment to the terms and conditions of the Existing Performance Rights as set out in Schedule 4 and as outlined in the Explanatory Memorandum.

Voting Exclusion and Prohibition

The Company will disregard any votes cast in favour this Resolution by or on behalf of Tim Levy, Crispin Swan and other senior management who are the holders of the Existing Performance Rights that is the subject of this Resolution or any associates of those persons.

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

(a) a person as proxy or attorney for a person who is entitled to vote on the Resolution, in accordance with 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.

(a) the person is appointed as a proxy and the appointment specifies how the proxy is to vote; or
(b) the person appointed as proxy is the Chair and the appointment does not specify how the Chair is to vote but expressly authorises the Chair to exercise the proxy even if the Resolution is connected directly or indirectly with the remuneration of a member of the Key Management Personnel.

Dated 6 May 2021 BY ORDER OF THE BOARD

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Tim Levy Managing Director

Family Zone Cyber Safety Limited ACN 167 509 177

EXPLANATORY MEMORANDUM

1. Introduction

This Explanatory Memorandum has been prepared for the information of Shareholders in connection with the business to be conducted at the Meeting to be held at 945 Wellington Street, West Perth on Wednesday, 9 June 2021 at 9.00am (WST).

This Explanatory Memorandum should be read in conjunction with, and forms part of, the accompanying Notice. The purpose of this Explanatory Memorandum is to provide information to Shareholders in deciding whether or not to pass the Resolutions set out in the Notice.

A Proxy Form is located at the end of the Explanatory Memorandum.

2. Action to be taken by Shareholders

Shareholders should read the Notice and this Explanatory Memorandum carefully before deciding how to vote on the Resolutions.

2.1 Proxies

A Proxy Form is attached to the Notice. This is to be used by Shareholders if they wish to appoint a representative (a 'proxy') to vote in their place. All Shareholders are invited and encouraged to attend the Meeting or, if they are unable to attend in person, sign and return the Proxy Form to the Company in accordance with the instructions thereon. Lodgment of a Proxy Form will not preclude a Shareholder from attending and voting at the Meeting in person.

Please note that:

(a) a member of the Company entitled to attend and vote at the Meeting is entitled to appoint a proxy;
(b) a proxy need not be a member of the Company; and
(c) a member of the Company entitled to cast two or more votes may appoint two proxies and may specify the proportion or number of votes each proxy is appointed to exercise, but where the proportion or number is not specified, each proxy may exercise half of the votes.

The enclosed Proxy Form provides further details on appointing proxies and lodging Proxy Forms.

3. Resolutions 1 and 2 – Ratification of Placement Shares

3.1 General

On 23 October 2020 the Company announced it had received commitments for a placement of 45,454,545 Shares ( Placement Shares ) each at an issue price of $0.44, to raise $20 million before costs ( Placement ) and that it was also launching a $2 million share purchase plan ( SPP ) offer.

The Placement Shares were issued on 3 November 2020 with 12,282,789 Shares ( LR 7.1 Placement Shares ) issued within the Company’s 15% annual limit permitted under Listing Rule 7.1, without the

need for Shareholder approval and 33,171,756 Shares ( LR 7.1A Placement Shares ) issued within the Company’s 10% annual limit permitted under Listing Rule 7.1A, without the need for Shareholder approval.

The funds raised from the Placement are and will be principally used to fund the acceleration of the Company’s growth strategy in existing markets as well as expansion into new markets. To support growth funds will be allocated to expanding the Company’s engineering teams, back office systems, structures and personnel to ensure a world class product and delivery.

Listing Rule 7.1 provides that a company must not (subject to specified exceptions), without the approval of shareholders, issue or agree to issue during any 12 month period any equity securities, or other securities with rights to conversion to equity, if the number of those securities exceeds 15% of the number of ordinary securities on issue at the commencement of that 12 month period.

Listing Rule 7.1A enables eligible entities to issue equity securities up to 10% of its issued share capital through placements over a 12 month period after the annual general meeting at which shareholders approve the 10% placement facility. The 10% placement facility is in addition to the Company's 15% placement capacity under Listing Rule 7.1.

Listing Rule 7.2 set out various types of equity issues that are excluded from the operation of Listing Rule 7.1 and 7.1A. The issue of the Placement Shares does not fit within any of these exceptions and, as it has not yet been approved by Shareholders, it effectively 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 issue of the Placement Shares and part of the 10% limit in Listing Rule 7.1A, reducing the Company's capacity to issue further equity securities without Shareholder approval under Listing Rule 7.1A for the balance of the 12 months from the date of the Company's 2020 Annual General Meeting.

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 (pursuant to Listing Rule 7.1 or the additional 10% capacity under Listing Rule 7.1A). 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.

To this end, Resolution 1 seeks Shareholder ratification of the issue of the LR 7.1 Placement Shares (which were issued pursuant to the Company's 15% capacity under Listing Rule 7.1) under and for the purposes of Listing Rule 7.4. Resolution 2 seeks Shareholder ratification of the issue of the LR 7.1A Placement Shares (which were issued pursuant to the Company's additional 10% capacity under Listing Rule 7.1A) under and for the purposes of Listing Rule 7.4.

If Resolution 1 is passed, the issue of the LR 7.1 Placement Shares will be excluded in calculating the Company's 15% limit in Listing Rule 7.1, effectively increasing the number of equity securities it can issue without Shareholder approval over the 12 month period following the date of issue of the Tranche 1 Placement Shares.

If Resolution 1 is not passed, the issue of the LR 7.1 Placement Shares will be included in calculating the Company's 15% limit in Listing Rule 7.1, effectively decreasing the number of equity securities it can issue without Shareholder approval over the 12 month period following the date of issue of the Placement Shares.

If Resolution 2 is passed, the issue of the LR 7.1A Placement Shares will be excluded in calculating the Company's additional 10% placement capacity under Listing Rule 7.1A, effectively increasing the number of equity securities it can issue without Shareholder approval during the balance of the 12 months from the date of the Company's 2020 Annual General Meeting.

If Resolution 2 is not passed, the issue of the LR 7.1A Placement Shares will be included in calculating the Company's additional 10% placement capacity under Listing Rule 7.1A, effectively decreasing the number of equity securities it can issue without Shareholder approval during the balance of the 12 months from the date of the Company's 2020 Annual General Meeting.

3.2 Information required by Listing Rule 7.5

The following information is provided for the purposes of Listing Rule 7.5:

(a) On 3 November 2020, 45,454,545 Shares were issued pursuant the Placement, with:
(i) 12,282,789 Placement Shares issued using the Company's capacity under Listing Rule 7.1; and
(ii) 33,171,756 Placement Shares issued using the Company's capacity under Listing Rule 7.1A.
(b) The Placement Shares were issued to the following persons:
(i) clients of the joint lead managers to the Placement, Argonaut Securities Pty Limited and Shaw Partners Limited ( Joint Lead Managers ), comprising various professional, sophisticated and institutional investors none of whom are a related party of the Company; and
(ii) existing investors, including substantial shareholder Regal Funds Management Pty Ltd, comprising professional, sophisticated and institutional investors, none of whom are a related party of the Company.

(the Placement Participants )

When selecting and determining the allocation of the Placement Shares, the Company and the Joint Lead Managers considered the size of the proposed investment, whether they were existing and/or strategic investors and previous support of capital raisings undertaken by the Company. The Company also undertook a SPP at the same issue price to ensure retail shareholders had the chance to participate as well.

(c) The Placement Shares are fully paid ordinary shares in the capital of the Company and rank equally in all respects with the Company's existing Shares on issue.
(d) The Placement Shares were issued at $0.44 each.
(e) The issue of the Placement Shares raised $20 million (before costs). The funds raised from the issue of the Placement Shares will be principally used to fund the acceleration of the Company’s growth strategy in existing markets as well as expansion into new markets as outlined further in Section 3.1 above.
(f) A voting exclusion statement is included in the Notice.

4. Resolution 3 – Ratification of issue of Shares to Netsweeper

4.1 General

On 23 May 2018 the Company entered into a collaboration agreement with Netsweeper pursuant to which Netsweeper agreed to provide its internet content filtering services to Family Zone’s cyber safety offerings and the parties agreed to work together to develop a disruptive offering into the USA educational sector and productise and Interface between Netsweepers inline offerings and Family Zone’s cyber safety ecosystem ( Collaboration Agreement ).

The material terms of the Collaboration Agreement are outlined below:

(a) (Term): An initial term of 2 years from 30 June 2018. Upon expiry of the initial term a further term of 2 years applied unless a either party terminated by giving written notice to the other party.
(b) (Exclusivity): During the Term, Family Zone agreed to exclusively use the Netsweeper filtering services for its offering to customers in the USA.
(c) (Advance Payment Shares): The Company agreed to the prepayment of USD1 million worth of future Netsweeper filtering services through the issue of fully paid ordinary shares in Family Zone ( Advance Payment Shares ). The number of Advance Payment Shares to be issued was based on the 30 day VWAP of Family Zone Shares prior to the signing of the Collaboration Agreement (being $0.4791). The Advance Payment Shares issued were subject to voluntary escrow and released from escrow each month based on the value of Netsweeper services consumed and invoiced. On expiry of the initial term all voluntary escrow restrictions applying to any remaining Advance Payment Shares immediately ceased and all Advance Payment Shares released from escrow.

(d) (Collaborations): The parties agreed to work together to establish and develop Family Zone discounted filtering service offering to K-12 education providers in the USA ( Disruptive Offering ) and to establish commercially available interfaces between Family Zone’s service and Netsweeper’s Policy Server ( Productised Policy Interface ) including:

dedicating sufficiently qualified and experienced personnel to performing agreed action as part of the Disruptive Offering and Productised Policy Interface;
Netsweeper agreed not to charge Family Zone for filtering services provided by Family Zone to K-12 education providers in the USA; and
Promoting each other’s product and service offering and use commercially reasonable efforts in doing so only within the scope of each party’s responsibilities and activities under the agreement.

On 19 October 2018, the Company issued 2,087,436 Advance Payment Shares to Netsweeper, which were subject to voluntary escrow. The Advance Payment Shares were released from escrow on a monthly basis as the filtering services were provided. Under the terms of the Collaboration Agreement on expiry of the initial term all unvested Advance Payment Shares were released from escrow and the parties agreed not to extend the Collaboration Agreement for a further term.

It was recently noted that the calculation of the Advance Payment Shares issued to Netsweeper under the Collaboration Agreement had been based on AUD1 million rather than USD1 million worth of filtering services. The number of Advance Payment Shares that should have been issued to Netsweeper under the Collaboration Agreement was 2,768,116 Shares.

On 3 December 2020, the Company therefore issued the additional 680,680 Shares ( Netsweeper Shares ) owing to Netsweeper under the terms of the Collaboration Agreement. The Netsweeper Shares were issued under the Company’s Listing Rule 7.1 capacity.

Further details in respect to the Collaboration Agreement were outlined in the announcement lodged with ASX on 25 May 2018.

Listing Rule 7.2 set out various types of equity issues that are excluded from the operation of Listing Rule 7.1. The issue of the Netsweeper Shares does not fit within any of these exceptions and, as it has not yet been approved by Shareholders, it effectively 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 issue of the Netsweeper Shares.

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 (pursuant to Listing Rule 7.1). 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.

To this end, Resolution 3 seeks Shareholder ratification of the issue of the Netsweeper Shares (which were issued pursuant to the Company's 15% capacity under Listing Rule 7.1) under and for the purposes of Listing Rule 7.4.

If Resolution 3 is passed, the issue of the Netsweeper Shares will be excluded in calculating the Company's 15% limit in Listing Rule 7.1, effectively increasing the number of equity securities it can issue without Shareholder approval over the 12 month period following the date of issue of the Netsweeper Shares.

If Resolution 3 is not passed, the issue of the Netsweeper Shares will be included in calculating the Company's 15% limit in Listing Rule 7.1, effectively decreasing the number of equity securities it can issue without Shareholder approval over the 12 month period following the date of issue of the Netsweeper Shares.

4.2 Information required by Listing Rule 7.5

The following information is provided for the purposes of Listing Rule 7.5:

(a) 680,680 Shares were issued to Netsweeper on 3 December 2020.
(b) The Netsweeper Shares were issued to Netsweeper pursuant to the Collaboration Agreement for internet content filtering services provided to Family Zone’s cyber safety offerings, therefore no funds were raised from the issue. The Netsweeper Shares were issued at an indicative issue price of $0.4791 each, based on the terms of the Collaboration Agreement.
(c) Material terms of the Collaboration Agreement are set out in Section 4.1.
(d) The Netsweeper Shares are fully paid ordinary shares in the capital of the Company and rank equally in all respects with the Company's existing Shares on issue.
(e) The Netsweeper Shares were issued to Netsweeper, which is not a related party of the Company.
(f) A voting exclusion statement is included in the Notice.

5. Resolutions 4, 5 and 6 – Grant of Director Securities

5.1 Background

The Company has established an executive remuneration incentive scheme to apply through to June 2023 ( Remuneration Incentive Scheme ).

The Remuneration Incentive Scheme has been developed taking into account the size of the Company’s business, the size of the executive team for the business, the nature and stage of development of current operations, market conditions and comparable salary levels for companies of a similar size and operating in similar sectors.

In addition, emphasis has been placed on the following specific issues in determining the remuneration policy for executives in the Company, namely that:

the Company is in a growth and development stage of its life cycle;
being a development business, the Company prefers to limit its outgoings and preserve cash holdings in the most effective way possible; and
the Company has less resources than many of its peers and/or competitors in the marketplace and lacks the financial cash resources of competitors to complete for talented executives based on cash salary only and therefore seeks to incentivise and align executives through a combination of short and longer term equity incentives.

The key objectives of the Remuneration Incentive Scheme are to:

provide competitive rewards to attract and retain high calibre executives;
conserve cash by providing both short term and longer term security based remuneration incentives;
align executives' incentives to the Company’s annual recurring revenue targets, strategic objectives and operational milestones;
link executive rewards to Shareholder value;
allocate a significant portion of executive remuneration to ‘at risk’ variable compensation, dependent upon performance and achievement of pre-determined benchmarks; and
ensure that performance benchmarks are balanced yet demanding.

The Remuneration Incentive Scheme comprises the following key components:

Fixed remuneration

Fixed remuneration or base salary is pay that is linked to the present value or market rate of the employees' role, and is payable in cash. It includes superannuation contributions.

Short Term Incentives

Short term incentives are broadly linked to the delivery of annual operational objectives.

Short term incentives and associated performance targets are set by the Board. For the financial years ending 30 June 2022 and 30 June 2023 these are:

100% growth in the recurring revenue each financial year; and
a positive personal scorecard (to be determined by the Board).

Short term incentive remuneration is payable only in equity by way of the STI 2022 Performance Rights and STI 2023 Performance Rights, subject to Shareholder approval where required.

Longer Term Incentives

Longer term incentives have been set by the Board for the next 2 years (as the business is rapidly growing it is not possible to set longer term objectives at the current time) and will be linked to delivery of the Company’ key strategic objectives under its business plan as well as growth in Shareholder value over the

current term of the Remuneration Incentive Scheme (i.e by 30 June 2023). Key longer term strategic objectives are:

Expand Markets - global market expansion and growth in annual recurring revenues outside the United States of America, Australia and New Zealand;
Expand Products – development and launch of additional product offerings;
Launch Consumer Products - growth of the Company’s consumer products outside Australia;
Make Sustainable – improve efficiency and reduce data and hosting costs to improve gross product margins; and
Improve Revenue per Subscriber – increase the revenues generated per student through providing additional product offerings.

Longer term incentive remuneration is payable in equity by way of LTI Performance Rights, subject to Shareholder approval.

Reward Incentive

The Reward Incentive is linked to the delivery of long term Shareholder performance. The Company has set share price as the market measure to evaluate long term Shareholder value performance.

Reward incentive remuneration is payable in equity by way of Director Options with Share price vesting targets, subject to Shareholder approval.

5.2 Proposed grant of Director Securities to Directors

Tim Levy is the Managing Director of the Company, Crispin Swan an Executive Director and Peter Pawlowitsch is Non-Executive Chairman.

Messrs Levy and Swan were two of the founding Directors of the Company and have each held their current positions in the Family Zone business since the Company’s listing on ASX in August 2016.

Mr Pawlowitsch was appointed as a Non-Executive Chairman of the Company in September 2019. Since this time he has worked closely with Tim Levy and Crispin Swan to constructively challenge and develop proposals on the business strategy for the Company, bringing independent judgement on issues of strategy, performance and utilisation of resources. He has also been integral in the Company successfully raising in excess of $36.9 million (investing over $1 million personally) to fund the Company’s strategic growth plans.

The Company has considered the guidelines in the ASX Corporate Governance Principles and Recommendations for non-executive director remuneration which notes that whilst it is generally acceptable for non-executive directors to receive securities as part of their remuneration to align their interests with the interests of other shareholders, generally they should not receive options with performance hurdles as it may lead to bias in their decision making and compromise objectivity. The Company believes the proposed issue of the Director Options to Mr Pawlowitsch will not impact his independent decision making and objectivity and that the Share price performance hurdles more closely aligns his interest with that of other Shareholders in creating Shareholder value.

The Board is seeking Shareholder approval to grant the Director Performance Rights and/or Director Options (together Director Securities ) to each of Messrs Levy, Swan and Pawlowitsch in accordance with the newly adopted Remuneration Incentive Scheme and the terms and conditions of the Plan.

The Board intends to grant the Director Securities, subject to Shareholder approval, as part of Mr Levy, Mr Swan and Mr Pawlowitsch’s respective remuneration packages. Vesting of the Director Securities

is dependent upon continued employment and achievement of certain short and longer term targets in line with the Remuneration Incentive Scheme as outlined above.

The proposed grant seeks to further align Mr Levy, Mr Swan and Mr Pawlowitsch’s interests with those of Shareholders by broadly linking their remuneration with the performance of the Company.

The Board (excluding Mr Levy, Mr Swan and Mr Pawlowitsch who decline to make a recommendation based on their interest in the outcomes of Resolutions 4, 5 and 6) recommends that Shareholders vote in favour of the grant of the Director Securities. The Chair intends to vote undirected proxies in favour of Resolutions 4, 5 and 6.

5.3 Listing Rule 10.14

Listing Rule 10.14 provides that a listed company must not permit any of the following persons to acquire equity securities under an employee incentive scheme:

(a) a director of the company;
(b) an associate of a director of the company; or
(c) a person whose relationship with the company or a person referred to in a Listing Rules 10.14.1 to 10.14.2 is such that, in ASX's opinion, the acquisition should be approved by its shareholders,

unless it obtains the approval of its shareholders.

The issue of the Director Securities falls within Listing Rule 10.14.1 and therefore requires Shareholder approval under Listing Rule 10.14.

Resolutions 4, 5 and 6 seek the required Shareholder approval to the issue of the Director Securities to Mr Levy, Mr Swan and Mr Pawlowitsch (or their nominees) under and for the purposes of Listing Rule 10.14.

If Resolutions 4, 5 and 6 are passed, the Company will issue the Director Securities to each of Messrs Levy, Swan and Pawlowitsch (or their nominees) as part of their incentive based remuneration.

If Resolutions 4, 5 and 6 are not passed, the Company will not issue the Director Securities to Messrs Levy, Swan and Pawlowitsch (or their nominees). In that circumstance, issues may arise with the competitiveness of Mr Levy, Mr Swan and Mr Pawlowitsch’s (as relevant) total remuneration package and alignment of rewards with other senior executives in the Company. The Board would then need to consider alternative remuneration arrangements which are consistent with the Company’s Remuneration Incentive Scheme, including providing an equivalent cash short and longer term incentive subject to the risk of forfeiture, performance conditions and performance period as described above.

Resolutions 4, 5 and 6 are ordinary resolutions.

5.4 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.

The issue of the Remuneration Shares to Messrs Levy, Swan and Pawlowitsch (or their nominees) pursuant to Resolutions 4, 5 and 6 constitutes the giving of a financial benefit and Messrs Levy, Swan and Pawlowitsch are each a related party of the Company by virtue of being Directors.

After a review of publicly available information relating to the remuneration structures of several of its peer companies, the Directors consider that Shareholder approval pursuant to Chapter 2E of the Corporations Act is not required in respect of the issue of the Director Securities Messrs Levy, Swan and Pawlowitsch because the issue is considered reasonable remuneration in the circumstances.

5.5 Information required by Listing Rule 10.15

The following information is provided for the purposes of Listing Rule 10.15.

(a) The maximum number, class of securities proposed to be issued and recipients of the securities are set out below:

securities are set	out below:
Recipient	STI 2022 Performance Rights	STI 2023 Performance Rights	LTI Performance Rights	Director Options
Tim Levy (or his nominees)	1,000,000	1,000,000	1,500,000	1,500,000(2)
Crispin Swan (or his nominees)	1,000,000	1,000,000	1,500,000	-
Peter Pawlowitsch (or his nominees)	-	-	-	3,000,000(3)
Total	2,000,000	2,000,000	3,000,000	4,500,000

Notes

(1) Refer to Annexure 1 and 2 for the full terms and conditions of the Director Securities.

(2) Comprising 500,000 Tranche 1 Director Options, 500,000 Tranche 2 Director Options and 500,000 Tranche 3 Director Options.
(3) Comprising 750,000 Tranche 1 Director Options, 750,000 Tranche 2 Director Options and 1,500,000 Tranche 3 Director Options.
(b) Approval is required to issue the Director Securities to Messrs Levy, Swan and Pawlowitsch as they fall within Listing Rule 10.14.1 by virtue of being Directors.
(c) The total remuneration package for Mr Levy, Mr Swan and Mr Pawlowitsch based on the indicative values attributed to the Director Securities outlined in Section 5.5(e) below and expensing the total security based remuneration over a 12 month period (for the financial year ending 30 June 2022) is outlined in the table below:

Director	Base Salary ($)	Director Securities 2021/2022 Security based remuneration ($)	Director Securities 2021/2022 Security based remuneration ($)	Director Securities 2021/2022 Security based remuneration ($)	Total ($)
		STI Performance Rights	LTI Performance Rights	Director Options
Tim Levy	$375,000(2)	$675,000	$337,500	$110,216	$1,497,716
Crispin Swan	$375,000(2)	$675,000	$337,500	-	$1,387,500
Peter Pawlowitsch	$100,000	-	-	$214,879	$314,879

Notes

(1) In accordance with applicable accounting standards, the total value of the Director Securities will be expensed over their vesting period and assumes an indicative issue date of 30 June 2021. These figures represent the dollar value of the maximum number of Director Securities that may be issued and are based on the indicative values attributed to the Director Securities (as detailed below in paragraph 5.5(e) ) for the 2021/22 financial year only.
(2) Mr Levy and Mr Swan’s current annual remuneration is $300,000 plus statutory superannuation. In the 2020/2021 financial year Mr Levy and Mr Swan elected to receive securities in lieu of $100,000 and $76,000 respectively of their base remuneration. The Board (excluding Mr Levy and Mr Swan) has approved the increase in base remuneration to $375,000 per annum plus $25,000 statutory superannuation effective 1 July 2021.
(d) The 2020 Plan is a new incentive scheme which was approved by Shareholders at the Company’s Annual General Meeting on 19 November 2020. No securities have previously been issued Messers Levy, Swan and/or Pawlowitsch under the 2020 Plan.
(e) The principle terms and conditions of the Director Performance Rights are set out in Schedule 1. The Director Options are exercisable at $0.50 on or before 30 June 2025, subject to meeting the share price target vesting conditions. The terms and conditions of the Director Options are set out in Schedule 2.

The Company's Remuneration Incentive Plan (outlined further in Section 5.1) includes the issue of Performance Rights and Options as part of short and longer term programmes to reward and incentivise staff rather than cash based bonuses.

Messrs Levy, Swan and Pawlowitsch are entitled to participate in the Company’s Remuneration Incentive Scheme and are proposed to be issued the Directors Securities. The STI Performance Rights are short term incentives linked to the delivery of annual operational objectives. The LTI Performance Rights are longer term incentives linked to the achievement of longer term strategic objectives of the Company. The Director Options are a reward incentive linked to the delivery of long term Shareholder performance.

The value attributed to each of the Director Performance Rights and Director Options is outlined below. These values are based on an independent valuation conducted by Stantons International Securities Pty Ltd ( Stantons ) at a deemed grant date of 12 March 2021.

Security	Value ($)
STI 2022 Performance Rights	0.4500
STI 2023 Performance Rights	0.4500
LTI Performance Rights	0.4500
Tranche 1 Director Options	0.2461
Tranche 2 Director Options	0.2174
Tranche 3 Director Options	0.1984

Independent accountants, Stantons have determined the value attributed to the Director Performance Rights (which have non-market based vesting conditions) using the Black & Scholes valuation methodology. For valuation purposes the Director Performance Rights are considered zero priced options given they will be issued for nil consideration and no consideration is payable on their conversion into Shares.

Key input assumptions to the Black & Scholes valuation include, the Company’s Share price on the deemed grant date of 12 March 2021, the exercise price, the term of the Director Performance Right, the expected volatility of the underlying Shares , the expected dividend yield and the risk-free interest rate for the term of the Director Performance Rights.

According to AASB 2 paragraph 19, “Vesting conditions, other than market conditions, shall not be taken into account when estimating the fair value of the shares or share rights at the measurement date. Instead, vesting conditions shall be taken into account by adjusting the

number of equity instruments included in the measurement of the transaction amount so that, ultimately, the amount recognised for goods and services received as consideration for the equity instruments granted shall be based on the number of equity instruments that eventually vest.”

The non-market based vesting conditions have therefore not been taken into account in assessing the fair value of the Director Performance Rights.

If the Director Performance Rights are approved and granted, AASB 2 ‘Share Based Payment’ stipulates that management of the Company has discretion to assess the likelihood of meeting any non-market based vesting condition by applying a probability weighting to the number of Performance Rights included in the valuation of each tranche. For the purposes of the Notice of Meeting, Stantons has assumed that all of the Director Performance Rights will vest to the holder.

The Director Options (which are subject to market based vesting conditions) have been valued using the Monte Carlo simulation methodology which incorporates simulation probability based value impact of the market conditions to determine the fair value of each tranche of the Director Options. Under this model, the Director Option value has been estimated using the average present value of the payoff of 100,000 simulated outcomes.

Based on these valuations the implied total value of the Director Securities to be issue to

(i) Mr Levy under Resolution 4 is $1,905,950;
(ii) Mr Swan under Resolution 5 is $1,575,000; and
(iii) Mr Pawlowitsch under Resolution 6 is $645,225.
(f) The Director Securities will be issued within three years after the date of the Meeting (or such later date to the extent permitted by any ASX waiver or modification of the Listing Rules).
(g) A summary of the Plan is set out in Schedule 3.
(h) The Director Securities will be granted for nil consideration as they are being granted as incentive based remuneration. Accordingly no funds will be raised from the grant of the Director Securities.
(i) No loans will be made to Messrs Levy, Swan and Pawlowitsch in connection with the issue of the Director Securities.
(j) Details of any securities issued under the 2020 Plan will be published in the Company’s annual report relating to the period in which they were issued, along with a statement that approval for the issue was obtained under Listing Rule 10.14.

Any additional persons covered by Listing Rule 10.14 who become entitled to participate in an issue of Securities under the 2020 Plan after Resolutions 4, 5 and 6 are approved and who were not named in the Notice will not participate until approval is obtained under that Listing Rule.

(k) A voting exclusion statement is included in the Notice.

6. Resolution 7 – Approval of the Amendment to the terms of Existing Performance Rights issued to Directors and Senior Executives

6.1 Background

The Company is proposing to amend the terms of the Existing Performance Rights approved by Shareholders on 1 May 2020 that have previously been issued to Directors, Tim Levy and Crispin Swan and other senior executives

During the Company's recent preparations of the Remuneration Incentive Scheme referred to in Section 5.1, it has become apparent that the terms of the Existing Performance Rights previously issued to senior executives including Tim Levy and Crispin Swan were inconsistent with the current ASX guidance on the requirements for performance milestones to be appropriate and equitable. In accordance with this guidance the terms of the new STI Performance Rights have been based on an actual Quarterly Recurring Revenue performance milestone rather than an Annual Recurring Revenue performance milestone.

As the new STI Performance Rights are based on a growth percentage from 30 June 2021 the Company requires the ending amount to equal the starting amount. Therefore for consistency and equality for the affected executives, and to ensure compliance with Listing Rule 6.1, the Company is proposing to change the ARR performance milestone (calculated by taking the June quarterly recurring revenue and multiplying by 4 to determine the annual recurring revenue) to a QRR (quarterly recurring revenue milestone calculated by taking the June quarterly recurring revenue) performance milestone to be the same as for the new STI Performance Rights to be issued to Tim Levy and Crispin Swan (and other senior executives) and to ensure compliance with Listing Rules 6.1. The balance of the terms and conditions of the Existing Performance Rights, including the number, expiry date and vesting date will not change.

The form of the proposed changes to the performance milestone in the Existing Performance Rights issued to executives Tim Levy and Crispin Swan (and other senior executives) are set out in Schedule 4.

A total of 5,875,000 Existing Performance Rights have been issued with 2,500,000 Existing Performance Rights held by Tim Levy and Crispin Swan (1,250,000 Existing Performance Rights each) and a further 3,375,000 held by other senior executives. As outlined in Schedule 4, no Existing Performance Rights will vest if the QRR achieved is less than $3.6 million (previously $14.4 million ARR – $14.4 million/4 to make the milestone a quarterly calculation) and all the Existing Performance Rights will vest if the QRR achieved is $5 million (previously $20 million ARR - $20.0 million/4 to make the milestone a quarterly calculation). Outlined below are examples of the total number of Existing Performance Rights being 5,875,000 which will vest under differing QRR scenarios between $3.6 million and $5.0 million.

QRR ($)	3,600,000	4,000,000	4,250,000	4,500,000	4,750,000	5,000,000
Number of Existing Performance Rights vesting	4,230,000	4,700,000	4,993,750	5,287,500	5,581,250	5,875,000
% of Existing Performance Rights vesting	72%	80%	85%	90%	95%	100%

Each of the holders of the Existing Performance Rights have agreed to amend the terms of the Existing Performance Rights in the form set out in Schedule 4.

6.2 Listing Rule 6.23.4

As is usual practice, ASX has imposed a requirement under Listing Rule 6.23.4 and ASX Guidance Note 19 "Performance Securities" that the Company obtain shareholder approval to amend the terms of the Existing Performance Rights.

Accordingly, Resolution 7 seeks the required Shareholder approval to amend the terms of the Existing Performance Rights in the form set out in Schedule 4, under and for the purposes of the Listing Rules.

If Resolution 7 is passed, the terms of the Existing Performance Rights previously issued to Tim Levy, Crispin Swan and other senior executives will be amended as set out in Schedule 4, with effect from the date of this Resolution.

If Resolution 7 is not passed, the terms and conditions of the Existing Performance Rights previously issued to Tim Levy, Crispin Swan and other senior executives will not be amended and will remain the same and the Company may seek an alternative method of appropriately rewarding and incentivizing those executives.

Resolution 7 is an ordinary resolution.

A voting exclusion statement for Resolution 7 is included in this Notice.

7. Definitions

$ means Australian Dollars.

Advance Payment Shares has the meaning set out in Section 4.1.

ASX means ASX Limited (ACN 008 624 691) and, where the context permits, the Australian Securities Exchange operated by ASX.

Board means the board of Directors.

Business Day has the same meaning as defined in Chapter 19 of the Listing Rules.

Chair means the chair of this Meeting.

Collaboration Agreement has the meaning set out in Section 4.1.

Company means Family Zone Cyber Safety Limited ACN 167 509 177.

Corporations Act means the Corporations Act 2001 (Cth).

Director means a director of the Company.

Director Options means the Options to be issued on the terms and conditions outlined in Schedule 2.

Director Performance Rights means the STI Performance Rights and the LTI Performance Rights.

Director Securities means the Director Options and the Director Performance Rights.

Existing Performance Rights means the Executive Performance Rights issued to Messrs Levy and Swan with the terms and conditions as summarised in the Company's notice of meeting dated 20 March 2020.

Explanatory Memorandum means the explanatory memorandum attached to the Notice.

Listing Rules means the listing rules of ASX.

LR 7.1 Placement Shares has the meaning given in Section 3.1

LR 7.1A Placement Shares has the meaning given in Section 3.1

LTI Performance Rights means the Performance Rights issued on the terms and condition outlined in Schedule 1.

Meeting has the meaning in the introductory paragraph of the Notice.

Netsweeper means Netsweeper Netherlands Cooperatief U.A .

Netsweeper Shares has the meaning set out in Section 4.1.

Notice means this notice of meeting.

Option means an option to acquire a Share.

Performance Right means a performance rights issued under the Plan.

Placement has the meaning given in Section 3.1.

Placement Participants has the meaning given in Section 3.2(b).

Placement Shares has the meaning given in Section 3.1.

Plan or 2020 Plan means the 2020 Family Zone 2020 Employee Securities Incentive Plan approved by Shareholders at the Annual General Meeting on 19 November 2020.

Proxy Form means the proxy form attached to the Notice.

Resolution means a resolution contained in this Notice.

Section means a section contained in this Explanatory Memorandum.

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

Shareholder means a shareholder of the Company.

Stantons means Stantons International Securities Pty Ltd.

STI 2022 Performance Rights means the Performance Rights issued on the terms and condition outlined in Schedule 1 as those terms apply to "STI 2022 Performance Rights”.

STI 2023 Performance Rights means the Performance Rights issued on the terms and condition outlined in Schedule 1 as those terms apply to "STI 2023 Performance Rights”.

STI Performance Rights means the STI 2022 Performance Rights and STI 2023 Performance Rights.

Tranche 1 Director Options means the Options to be issued on the terms and conditions outlined in Schedule 2 as those terms apply to "Tranche 1 Director Options”.

Tranche 2 Director Options means the Options to be issued on the terms and conditions outlined in Schedule 2 as those terms apply to "Tranche 2 Director Options”.

Tranche 3 Director Options means the Options to be issued on the terms and conditions outlined in Schedule 2 as those terms apply to "Tranche 3 Director Options”.

VWAP means volume weighted average price.

WST means Western Standard Time, being the time in Perth, Australia.

In this Notice, words importing the singular include the plural and vice versa.

Schedule 1: Key Terms and Conditions of Performance Rights

The Performance Rights will be granted pursuant to the 2020 Plan and on the following terms and conditions

1. Conversion and Expiry of Performance Rights

The Performance Rights will be granted with the Vesting Conditions and Expiry Dates as outlined below.

a. Vesting Conditions

Each Performance Right will vest when the applicable Vesting Condition(s) outlined below has been satisfied or waived.

STI 2022 Performance Rights

If the holder remains in continued employment with the Company until 30 June 2022, the 2022 STI Performance Rights shall vest as follows:

(i) ( Personal Scorecard ) If the holder receives a positive “Personal Scorecard” (scorecard to be determined by agreement between the Company and the Executive) for the financial year ended 30 June 2022 from the Board for performance over the previous 12 months, 50% of the STI 2022 Performance Rights shall vest.
(ii) ( QRR Growth ) If the Company achieves 50% growth in Quarterly Recurring Revenue (QRR) from 1 April 2022 to 30 June 2022 compared to the corresponding period in the previous year, 60% of the remaining 50% of the STI 2022 Performance Rights shall vest, with straight line prorata vesting for additional percentages of QRR Growth up to 100% from 1 April 2022 to 30 June 2022 compared to the corresponding period in the previous year.

STI 2023 Performance Rights

If the holder remains in continued employment with the Company until 30 June 2023, the STI 2023 Performance Rights shall vest as follows:

(i) ( Personal Scorecard ) If the holder receives a Positive Personal Scorecard (scorecard to be determined by agreement between the Company and the Executive) for the financial year ended 30 June 2023 from the Board for performance over the previous 12 months, 50% of the STI 2023 Performance Rights shall vest.
(ii) ( QRR Growth ) If the Company achieves 40% growth in Quarterly Recurring Revenue ( QRR ) from 1 April 2023 to 30 June 2023 compared to the corresponding period in the previous year, 50% of the remaining 50% of the STI 2023 Performance Rights shall vest, with straight line prorata vesting for additional percentages of QRR Growth up to 100% from 1 April 2023 to 30 June 2023 compared to the corresponding period in the previous year.

LTI Performance Rights

If the holder remains in continued employment with the Company until 30 June 2023, 150,000 LTI Performance Rights shall vest for each Operational Milestone achieved by 30 June 2023 with a maximum of 450,000 LTI Performance Rights vesting per Objective

Objective	Operational Milestones (to be achieved by 30 Jun 2023)
Expand Markets	• Achieving revenue of greater than $500,000 in total prior to 30 June 2023 in a market other than USA, Australia or New Zealand.

Expand Products	• Launch of a new product which generates revenue of greater than $500,000 in total prior to 30 June 2023. • Launch of a new product which achieves 2.5% take-up by School Clients in a particular country.
Launch Community	• Launch of Community in a market outside of Australian and achieve greater than 20% take-up by School Clients. • Launch of Community in a market outside of Australian and achieve greater than 30% take-up by School Clients. • Launch of Community in a market outside of Australia and achieve 2% of parents within all participating School Clients activating a Consumer Account. • Launch of Community in a country outside of Australia and achieve 5% of parents within all participating School Clients activating a Consumer Account
Make Sustainable	• Achieve quarterly average data and hosting costs per student below targets set by the Board • Achieve quarterly Service Margin above targets set by the Board.
Improve Revenues per Student	• Achieve Average Revenue Per Student targets set by the Board.

Quarterly recurring revenue (QRR): means the June quarter (1 April to 30 June) recurring revenue calculated as follows:

ARR = Education QRR + Consumer QRR

The following definitions and other terms are applicable to the operational milestone and QRR calculation

Education QRR means QRPsl x Number of Licensed Students at 30 June

Consumer QRR means QRPca x Number of Consumer Accounts at 30 June

QRPsl is the average revenue per student license for the relevant quarter and means the June quarter Education Revenue divided by the average of the number of Licensed Students at the end of each month in that quarter, calculated separately in local currency for revenues in each currency and the QRPsl of each currency then converted at 30 June into AUD using the Exchange Rate.

QRPca is the average revenue per premium parent account for the relevant quarter and means the June quarter Consumer Revenue divided by the average of the number of Consumer Accounts at the end of each month in that quarter, calculated separately in local currency for revenues in each currency and the QRPca of each currency then converted at 30 June into AUD using the Exchange Rate.

Education Revenue means accounting revenue determined from the Company's management accounts applicable to customers other than consumers, excluding any revenue associated with the upfront sale of hardware (ie not on a contract).

Consumer Revenue means accounting revenue determined from the Company's management accounts applicable to consumer customers, excluding any revenue associated with the upfront sale of hardware (ie not on a contract).

Licensed Students equals the number of student licenses associated with contracted education clients (and excludes students associated with trials).

Consumer Accounts equals the number of premium paid parent consumer accounts (and excludes school paid accounts).

Acquired products and businesses: Acquired products and businesses do contribute to relevant Operational Milestones.

Average Revenue Per Student is an annual figure and is converted from local currency into AUD using the Exchange Rate and means average revenue per student calculated as the annual revenue inclusive

of all direct and indirect revenue associated with our education business for the applicable financial year (e.g. school licenses, school consulting and parental control income associated with students at our school clients) divided by the number of Licensed Students at 30 June.

Exchange Rate: means the exchange rate set by the Company for the purpose of budgeting in the relevant financial year. For clarity, financially-based Operational Milestones and the QRR are, for the purpose of a proper comparison set and measured at the start of the period and the end of the period at the budgeted exchange rate set by the Company irrespective of actual exchange rate at the applicable times.

Launch of Community means: Activation of Family Zone Community through either the launch of a Cyber Safety Hub by a School Client or a School Client enabling parent subscriptions to student school accounts.

Positive Personal Scorecard means: Acceptable performance under the Company’s individual performance management program, as agreed with the Board.

School Client means a school who uses a product of the Company whether directly or indirectly contracted with the Company (eg. schools within a school district that uses Company products).

Service Margin in a period means (net customer revenue minus data & hosting costs) / (net customer revenue) where net customer revenue is customer revenue less attributable channel sales commissions.

Determination of the extent to which a QRR milestone is met and the number of the STI 2022 Performance Rights and STI 2023 Performance Rights which will vest will be made by the auditor of the Company.

b. Issue of Shares

Each Performance Right will convert into a Share for no consideration on exercise by the holder once vested.

c. Expiry Date

The expiry date for the 2022 STI Performance Rights is 30 June 2024. The expiry date of each of the 2023 STI Performance Rights and LTI Performance Rights is 30 June 2025.

If a Vesting Condition of a Performance Right is not achieved and/or otherwise waived by the Board, then the Performance Right will lapse. If a vested Performance Right is not exercised on or before the Expiry Date, then the Performance Right will lapse.

d. Notice of Exercise

A Performance Right may be exercised by notice in writing to the Company (Notice of Exercise)

e. Lapse Date

A Performance Right will lapse on that date ( Lapse Date ) which is the earlier to occur of:

i. the Expiry Date referred to in item 1(c) above;
ii. failure to meet a Vesting Condition or any other condition applicable to the Performance Right within the prescribed period (if any) or becomes incapable of satisfaction, as determined by the Board in its absolute discretion, unless the Board exercises its discretion to waive the Vesting Condition in accordance with the Plan;
iii. the Board determines that a Performance Right lapses due to fraud, dishonesty or other improper behaviour of the Participant under the Plan;the Board determines that a Participant Deals with a Performance Right in contravention to the Plan; and

iv. as determined in accordance with item 1(f) below.

f. Leaving the Company Group

If a holder of Performance Rights ceases to be an employee of the Company Group by reason of resignation or termination for cause, any unvested Performance Rights will lapse or be forfeited (as the case may be) unless the Board determines otherwise. However, all Performance Rights will vest and convert into Shares in the following circumstances:

i. death or total and permanent disablement;
ii. redundancy;
iii. retirement; or
iv. termination by agreement or termination by notice of Company under the relevant employment contract.

2. Other rights attaching to Performance Rights

a. ( Exercise period ) A Performance Right may be exercised at any time after the date that the Performance Rights have Vested in accordance with the Plan, and on or prior to the Lapse Date.
b. ( Plan ) The Performance Rights are granted in accordance with, and subject to the Company’s 2020 Employee Securities Incentive Plan and unless otherwise stated, terms defined in these terms and conditions have the meaning given to those terms in the Plan.
c. ( No voting rights ) A Performance Right does not entitle a holder to vote on any resolutions proposed at a general meeting of the Company’s Shareholders.
d. ( No dividend rights ) A Performance Right does not entitle a holder to any dividends.
e. ( Rights on winding up ) A Performance Right does not entitle the holder to participate in the surplus profits or assets of the Company upon winding up of the Company.
f. ( Not transferable ) A Performance Right is not transferable.
g. ( Reorganisation of capital ) If there is a reorganisation (including, without limitation, consolidation, sub-division, reduction or return) of the issued capital of the Company, the rights of a holder will be varied (as appropriate) in accordance with the Listing Rules which apply to reorganisation of capital at the time of the reorganisation.
h. ( Shares issued on conversion ) Shares issued on conversion of the Performance Rights rank equally with the then Shares of the Company.
i. ( Quotation of shares on conversion ) An application will be made by the Company to ASX for official quotation of the Shares issued upon the conversion of each Performance Right within the time period required by the Listing Rules.
j. ( Participation in entitlements and bonus issues ) A Performance Right does not entitle a holder to participate in new issues of capital offered to holders of Shares, such as bonus issues and entitlement issues.
k. ( Change of Control Event ) If a Change of Control Event occurs in relation to the Company, or the Board determines that such an event is likely to occur, then the Performance Rights in respect of which the vesting conditions are not satisfied will automatically vest and be capable of exercise such that allows the holder to participate in and/or benefit from any

transaction arising from or in connection with the Change of Control Event. For these purposes, Change of Control Event means:

i. a change in Control (as defined in section 50AA of the Corporations Act 2001 (Cth)) of the Company;
ii. the announcement by the Company that Shareholders have at a Court convened meeting of shareholders voted in favour, by the necessary majority, of a proposed scheme of arrangement under which all Shares are to be either cancelled, or transferred to a third party, and the Court, by order, approves the proposed scheme of arrangement;
iii. where a person becomes the legal or the beneficial owner of, or has a Relevant Interest in, more than fifty per cent (50%) of Issued Capital;
iv. where a person becomes entitled to acquire, hold or has an equitable interest in more than fifty per cent (50%) of Issued Capital; and
v. where a Takeover Bid is made to acquire more than fifty per cent (50%) of Issued Capital (or such lesser number of Shares that when combined with the Shares that the bidder (together with its Associates) already owns will amount to more than 50% of Issued Capital) and the Takeover Bid becomes unconditional and the bidder (together with its Associates) has a Relevant Interest in more than 50% of Issued Capital,

but, for the avoidance of doubt, does not include any internal reorganisation of the structure, business and/or assets of the Group.

l. ( Quotation of Performance Rights ) No application for quotation of the Performance Rights will be made by the Company.
m. ( Deferred Taxation ) Subdivision 83A-C of the Income Tax Assessment Act 1997 (Cth) applies to the Performance Rights.
n. ( No other rights ) A Performance Right does not give a holder any other rights other than those expressly provided by these terms and the Plan and those provided at law where such rights at law cannot be excluded by these terms.

Schedule 2: Key Terms and Conditions of Director Options

The terms and conditions of the Director Options are outlined below:

1. Entitlement

Each Director Option ( Option ) entitles the holder to subscribe for one Share upon exercise of each Option.

2. Exercise Price and Expiry Date

The Exercise Price, Vesting Conditions and Expiry Date of each Option are referred to in the tables below.

Tranche	Vesting Condition	Exercise Price	Expiry Date
1	The 20 day VWAP of the Company’s Shares being greater than $0.90 by 30 June 2024 and The holder being continuously employed by the Company on 30 June 2023	$0.50	30 June 2025
2	The 20 day VWAP of the Company’s Shares being greater than $1.45 by 30 June 2024 and The holder being continuously employed by the Company on 30 June 2023	$0.50	30 June 2025
3	The 20 day VWAP of the Company’s Shares being greater than $1.90 by 30 June 2024 and The holder being continuously employed by the Company on 30 June 2023	$0.50	30 June 2025

3. Lapse Date

An Option will lapse on that date ( Lapse Date ) which is the earlier to occur of:

(i) the Expiry Date referred to in 2 above;
(ii) failure to meet a Vesting Condition or any other condition applicable to the Option within the prescribed period (if any) or becomes incapable of satisfaction, as determined by the Board in its absolute discretion, unless the Board exercises its discretion to waive the Vesting Condition in accordance with the Plan;
(iii) the Board determines that a Option lapses due to fraud, dishonesty or other improper behaviour of the holder under the Plan;
(iv) the Board determines that a holder Deals with an Option in contravention to the Plan; and
(v) as determined in accordance with item 4 below.

4. Leaving the Company Group

If a holder of Options ceases to be an employee of the Company Group by reason of resignation or termination for cause, any unvested Options will lapse or be forfeited (as the case may be) unless the Board determines otherwise. However, all Options will vest and convert into Shares in the following circumstances:

(i) death or total and permanent disablement;

(ii) redundancy;

(iii) retirement; or
(iv) termination by agreement or termination by notice of Company under the relevant employment agreement.

5. Change in Control

If a Change of Control Event occurs in relation to the Company, or the Board determines that such an event is likely to occur, then the Options in respect of which the vesting conditions are not satisfied will automatically vest and be capable of exercise such that allows the holder to participate in and/or benefit from any transaction arising from or in connection with the Change of Control Event. For these purposes, Change of Control Event means:

(a) a change in Control (as defined in section 50AA of the Corporations Act 2001 (Cth)) of the Company;
(b) the announcement by the Company that Shareholders have at a Court convened meeting of shareholders voted in favour, by the necessary majority, of a proposed scheme of arrangement under which all Shares are to be either cancelled, or transferred to a third party, and the Court, by order, approves the proposed scheme of arrangement;
(c) where a person becomes the legal or the beneficial owner of, or has a Relevant Interest in, more than fifty per cent (50%) of Issued Capital;
(d) where a person becomes entitled to acquire, hold or has an equitable interest in more than fifty per cent (50%) of Issued Capital; and
(e) where a Takeover Bid is made to acquire more than fifty per cent (50%) of Issued Capital (or such lesser number of Shares that when combined with the Shares that the bidder (together with its Associates) already owns will amount to more than 50% of Issued Capital) and the Takeover Bid becomes unconditional and the bidder (together with its Associates) has a Relevant Interest in more than 50% of Issued Capital,

but, for the avoidance of doubt, does not include any internal reorganisation of the structure, business and/or assets of the Group.

6. Exercise Period

The Options are exercisable at any time after the Vesting Conditions in item 2 above have been met and on or prior to the Expiry Date.

7. Notice of Exercise

The Options may be exercised by notice in writing to the Company ( Notice of Exercise ) and payment of the Exercise Price for each Option being exercised. Any Notice of Exercise of an Option received by the Company will be deemed to be a notice of the exercise of that Option as at the date of receipt.

8. Cashless Exercise Facility

(a) The holder of Options may, subject to item 8(c) below, elect to pay the Exercise Price for a Option by setting off the exercise price against the number of Shares which they are entitled to receive upon exercise ( Cashless Exercise Facility ). By using the Cashless Exercise Facility, the holder will receive Shares to the value of the surplus after the Exercise Price has been set off.
(b) If the holder elects to use the Cashless Exercise Facility, the holder will only be issued that number of Shares (rounded down to the nearest whole number) as are equal in value to the

difference between the total Exercise Price otherwise payable for the Options on the Options being exercised and the then market value of the Shares at the time of exercise (determined as the volume weighted average of the prices at which Shares were traded on the ASX during the one week period immediately preceding the exercise date) calculated in accordance with the following formula:

S = O x (MSP – EP)

MSP

Where:

S = Number of Shares to be issued on exercise of the Options.

O = Number of Options.

MSP = Market value of the Shares (calculated using the volume weighted average prices at which Shares were traded on the ASX over the one week period immediately preceding the exercise date).

EP = Option exercise price.

(c) If the difference between the total Exercise Price otherwise payable for the Options on the Options being exercised and the then market value of the Shares at the time of exercise (calculated in accordance with item 8(b)) is zero or negative, then the holder will not be entitled to use the Cashless Exercise Facility.

9. Shares issued on exercise

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

10. Quotation of Shares on exercise

Application will be made by the Company to ASX for quotation of the Shares issued upon the exercise of the Options.

11. Timing of issue of Shares

After an Option is validly exercised, the Company must, as soon as possible following receipt of the Notice of Exercise and receipt of cleared funds equal to the sum payable on the exercise of the Option:

(a) issue the Share;

(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 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) do all such acts matters and things to obtain the grant of official quotation of the Share on ASX no later than 5 Business Days after issuing the Share.

12. 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.

13. Adjustment for bonus issues of Shares

If the Company makes a bonus issue of Shares or other securities to existing Shareholders (other than an issue in lieu or in satisfaction of dividends or by way of dividend reinvestment):

(a) the number of Shares which must be issued on the exercise of an Option will be increased by the number of Shares which the option holder would have received if the option holder had exercised the Option before the record date for the bonus issue; and
(b) no change will be made to the Exercise Price.

14. Adjustment for rights issue

If the Company makes an issue of Shares pro rata to existing Shareholders there will be no adjustment of the Exercise Price of an Option.

15. Adjustments for reorganisation

If there is any reorganisation of the issued share capital of the Company, the rights of the option holder may be varied to comply with the Listing Rules which apply to a reorganisation of capital at the time of the reorganisation.

16. Quotation of Options

No application for quotation of the Options will be made by the Company.

17. Options not transferable

Options are not transferable unless they are Vested Options and only with the prior written approval of the Board of directors of the Company and subject to compliance with the Corporations Act.

18. Lodgement Instructions

Cheques shall be in Australian currency made payable to the Company and crossed "Not Negotiable". The application for Shares on exercise of the Options with the appropriate remittance should be lodged at the Company's Registry.

19. ( Deferred Taxation ) Subdivision 83A-C of the Income Tax Assessment Act 1997 (Cth) applies to the Performance Rights.

Schedule 3: Summary of the Plan

Summary of the Plan and terms on which offers may be made:

1. Eligible Participant

"Eligible Participant" means a person who is a full-time or part-time employee, officer, or contractor of the Company, or an Associated Body Corporate (as defined in ASIC Class Order 14/1000), or such other person who has been determined by the Board to be eligible to participate in the Plan from time to time.

The Company will seek Shareholder approval for the participation of Directors and their associates in accordance with ASX Listing Rule 10.14.

2. Purpose

The purpose of the Plan is to:

(a) assist in the reward, retention and motivation of Eligible Participants;
(b) link the reward of Eligible Participants to Shareholder value creation; and
(c) align the interests of Eligible Participants with shareholders of the Group (being the Company and each of its Associated Bodies Corporate), by providing an opportunity to Eligible Participants to receive an equity interest in the Company in the form of Securities.

3. Plan administration

The Plan will be administered by the Board. The Board may exercise any power or discretion conferred on it by the Plan rules in its sole and absolute discretion. The Board may delegate its powers and discretion.

4. Eligibility, invitation and application

The Board may from time to time determine that an Eligible Participant may participate in the Plan and make an invitation to that Eligible Participant to apply for Securities on such terms and conditions as the Board decides.

On receipt of an Invitation, an Eligible Participant may apply for the Securities the subject of the invitation by sending a completed application form to the Company. The Board may accept an application from an Eligible Participant in whole or in part.

If an Eligible Participant is permitted in the invitation, the Eligible Participant may, by notice in writing to the Board, nominate a party in whose favour the Eligible Participant wishes to renounce the invitation.

5. Grant of Securities

The Company will, to the extent that it has accepted a duly completed application, grant the Participant the relevant number of Securities, subject to the terms and conditions set out in the invitation, the Plan rules and any ancillary documentation required.

6. Terms of Convertible Securities

Each "Convertible Security" represents a right to acquire one or more Shares (for example, under an option or performance right), subject to the terms and conditions of the Plan.

Prior to a Convertible Security being exercised a Participant does not have any interest (legal, equitable or otherwise) in any Share the subject of the Convertible Security by virtue of holding the Convertible

Security. A Participant may not sell, assign, transfer, grant a security interest over or otherwise deal with a Convertible Security that has been granted to them unless otherwise determined by the Board. A Participant must not enter into any arrangement for the purpose of hedging their economic exposure to a Convertible Security that has been granted to them.

7. Vesting of Convertible Securities

Any vesting conditions applicable to the grant of Convertible Securities will be described in the invitation. If all the vesting conditions are satisfied and/or otherwise waived by the Board, a vesting notice will be sent to the Participant by the Company informing them that the relevant Convertible Securities have vested. Unless and until the vesting notice is issued by the Company, the Convertible Securities will not be considered to have vested. For the avoidance of doubt, if the vesting conditions relevant to a Convertible Security are not satisfied and/or otherwise waived by the Board, that Convertible Security will lapse.

8. Exercise of Convertible Securities and cashless exercise

To exercise a Convertible Security, the Participant must deliver a signed notice of exercise and, subject to a cashless exercise of Convertible Securities (see below), pay the exercise price (if any) to or as directed by the Company, at any time following vesting of the Convertible Security (if subject to vesting conditions) and prior to the expiry date as set out in the invitation or vesting notice.

An invitation may specify that at the time of exercise of the Convertible Securities, the Participant may elect not to be required to provide payment of the exercise price for the number of Convertible Securities specified in a notice of exercise, but that on exercise of those Convertible Securities the Company will transfer or issue to the Participant that number of Shares equal in value to the positive difference between the Market Value of the Shares at the time of exercise and the exercise price that would otherwise be payable to exercise those Convertible Securities.

Market Value means, at any given date, the volume weighted average price per Share traded on the ASX over the 5 trading days immediately preceding that given date, unless otherwise specified in an invitation.

A Convertible Security may not be exercised unless and until that Convertible Security has vested in accordance with the Plan rules, or such earlier date as set out in the Plan rules.

9. Delivery of Shares on exercise of Convertible Securities

As soon as practicable after the valid exercise of a Convertible Security by a Participant, the Company will issue or cause to be transferred to that Participant the number of Shares to which the Participant is entitled under the Plan rules and issue a substitute certificate for any remaining unexercised Convertible Securities held by that Participant.

10. Forfeiture of Convertible Securities

Where a Participant who holds Convertible Securities ceases to be an Eligible Participant or becomes insolvent, all unvested Convertible Securities will automatically be forfeited by the Participant, unless the Board otherwise determines in its discretion to permit some or all of the Convertible Securities to vest.

Where the Board determines that a Participant has acted fraudulently or dishonestly; committed an act which has brought the Company, the Group or any entity within the Group into disrepute, or wilfully breached his or her duties to the Group or where a Participant is convicted of an offence in connection with the affairs of the Group; or has a judgment entered against him or her in any civil proceedings in respect of the contravention by the Participant of his or her duties at law, in equity or under statute, in his or her capacity as an employee, consultant or officer of the Group, the Board may in its discretion deem all unvested Convertible Securities held by that Participant to have been forfeited.

Unless the Board otherwise determines, or as otherwise set out in the Plan rules:

(a) any Convertible Securities which have not yet vested will be forfeited immediately on the date that the Board determines (acting reasonably and in good faith) that any applicable vesting conditions have not been met or cannot be met by the relevant date; and
(b) any Convertible Securities which have not yet vested will be automatically forfeited on the expiry date specified in the invitation or vesting notice.

11. Change of control

If a change of control event occurs in relation to the Company, or the Board determines that such an event is likely to occur, the Board may in its discretion determine the manner in which any or all of the Participant's Convertible Securities will be dealt with, including, without limitation, in a manner that allows the Participant to participate in and/or benefit from any transaction arising from or in connection with the change of control.

12. Rights attaching to Plan Shares

All Shares issued or transferred under the Plan, or issued or transferred to a Participant upon the valid exercise of a Convertible Security, (Plan Shares) will rank equally in all respects with the Shares of the same class. A Participant will be entitled to any dividends declared and distributed by the Company on the Plan Shares and may participate in any dividend reinvestment plan operated by the Company in respect of Plan Shares. A Participant may exercise any voting rights attaching to Plan Shares.

13. Disposal restrictions on Plan Shares

If the invitation provides that any Plan Shares are subject to any restrictions as to the disposal or other dealing by a Participant for a period, the Board may implement any procedure it deems appropriate to ensure the compliance by the Participant with this restriction.

For so long as a Plan Share is subject to any disposal restrictions under the Plan, the Participant will not:

(a) transfer, encumber or otherwise dispose of, or have a security interest granted over that Plan Share; or
(b) take any action or permit another person to take any action to remove or circumvent the disposal restrictions without the express written consent of the Company.

14. Adjustment of Convertible Securities

If there is a reorganisation of the issued share capital of the Company (including any subdivision, consolidation, reduction, return or cancellation of such issued capital of the Company), the rights of each Participant holding Convertible Securities will be changed to the extent necessary to comply with the ASX Listing Rules applicable to a reorganisation of capital at the time of the reorganisation.

If Shares are issued by the Company by way of bonus issue (other than an issue in lieu of dividends or by way of dividend reinvestment), the holder of Convertible Securities is entitled, upon exercise of the Convertible Securities, to receive an issue of as many additional Shares as would have been issued to the holder if the holder held Shares equal in number to the Shares in respect of which the Convertible Securities are exercised.

Unless otherwise determined by the Board, a holder of Convertible Securities does not have the right to participate in a pro rata issue of Shares made by the Company or sell renounceable rights.

15. Participation in new issues

There are no participation rights or entitlements inherent in the Convertible Securities and holders are not entitled to participate in any new issue of Shares of the Company during the currency of the Convertible Securities without exercising the Convertible Securities.

16. Compliance with applicable law

No Security may be offered, grated, vested or exercised if to do so would contravene any applicable law. In particular, the Company must have reasonable grounds to believe, when making an invitation, that the total number of Plan Shares that may be issued upon exercise of Convertible Securities offer when aggregated with the number of Shares issued or that may be issued as a result of offers made at any time during the previous three year period under:

(a) an employee incentive scheme of the Company covered by ASIC Class Order 14/1000; or
(b) an ASIC exempt arrangement of a similar kind to an employee incentive scheme,
(c) but disregarding any offer made or securities issued in the capital of the Company by way of or as a result of:
(d) an offer to a person situated at the time of receipt of the offer outside Australia;
(e) an offer that did not need disclosure to investors because of section 708 of the Corporations Act (exempts the requirement for a disclosure document for the issue of securities in certain circumstances to investors who are deemed to have sufficient investment knowledge to make informed decisions, including professional investors, sophisticated investors and senior managers of the Company); or
(f) an offer made under a disclosure document,

would not exceed 5% (or such other maximum permitted under any applicable law) of the total number of Shares on issue at the date of the invitation.

17. Amendment of Plan

Subject to the following paragraph, the Board may at any time amend any provisions of the Plan rules, including (without limitation) the terms and conditions upon which any Securities have been granted under the Plan and determine that any amendments to the Plan rules be given retrospective effect, immediate effect or future effect.

No amendment to any provision of the Plan rules may be made if the amendment materially reduces the rights of any Participant as they existed before the date of the amendment, other than an amendment introduced primarily for the purpose of complying with legislation or to correct manifest error or mistake, amongst other things, or is agreed to in writing by all Participants.

18. Plan duration

The Plan continues in operation until the Board decides to end it. The Board may from time to time suspend the operation of the Plan for a fixed period or indefinitely, and may end any suspension. If the Plan is terminated or suspended for any reason, that termination or suspension must not prejudice the accrued rights of the Participants.

If a Participant and the Company (acting by the Board) agree in writing that some or all of the Securities granted to that Participant are to be cancelled on a specified date or on the occurrence of a particular event, then those Securities may be cancelled in the manner agreed between the Company and the Participant.

19. Income Tax Assessment Act

The Plan is a plan to which Subdivision 83A-C of the Income Tax Assessment Act 1997 (Cth) applies (subject to the conditions in that Act) unless the Board determines otherwise.

Schedule 4 Amended Terms and Conditions of previously issued Existing Performance Rights

The Existing Performance Rights currently will vest (subject to the employee not being in performance management) on achievement of the vesting condition set out below:

Performance Rights	Vesting Condition	Milestone Date	Number of Performance Rights Vesting
Existing Performance Rights	The achievement of ARR of $14.4m by the Milestone Date (being 90% of targeted ARR of $16 million)	30 June 2021	If the ARR is $20m or more (which is 125% of the targeted ARR), 100% of the ARR Performance Rights held; OR If the ARR is less than $20m, the number of ARR Performance Rights vesting is determined based on this formula: [ARR at the Milestone Date_1/ $16m] x [(Number Executive_ Performance Rights held) x (100/125)]

1. ARR of the Company as at the Milestone Date (30 June 2021) will be equal to 12 x the consolidated revenue reported by the Company in the month of June 2021, in accordance with Australian Accounting Standards, inclusive of contracted and uncontracted service revenue and exclusive of one off revenue such as installation fees, hardware and any R&D or other grant income.

Should Shareholders approve Resolution 7 the Existing Performance Rights will vest (subject to the employee not being in performance management) on achievement of the vesting condition set out below (rather than as detailed in Note 1 above):

Performance Rights	Vesting Condition	Milestone Date	Number of Performance Rights Vesting
Existing Performance Rights	The achievement of QRR of $3.6m by the Milestone Date (being 90% of targeted QRR of $4 million)	30 June 2021	If the QRR is $5m or more (which is 125% of the targeted ARR), 100% of the QRR Performance Rights held; OR If the QRR is less than $5m, the number of ARR Performance Rights vesting is determined based on this formula: [QRR at the Milestone Date_1/ $4m] x [(Number Executive_ Performance Rights held) x (100/125)]

Quarter recurring revenue (QRR): means the June quarter (1 April to 30 June) recurring revenue calculated as follows:

QRR = Education QRR + Consumer QRR

The following definitions and other terms are applicable to the QRR calculation

Education QRR means QRPsl x Number of Licensed Students at 30 June

Consumer QRR means QRPca x Number of Consumer Accounts at 30 June

Licensed Students equals the number of student licenses associated with contracted education clients (and excludes students associated with trials).

Consumer Accounts equals the number of premium paid parent consumer accounts (and excludes school paid accounts).

Acquired products and businesses: Acquired products and businesses do contribute to relevant Operational Milestones.

Exchange Rate: means the exchange rate set by the Company for the purpose of budgeting in the relevant financial year. For clarity, the QRR is, for the purpose of a proper comparison set and measured at the start of the period and the end of the period at the budgeted exchange rate set by the Company irrespective of actual exchange rate at the applicable times.

Determination of the extent to which a QRR milestone is met and the number of QRR Performance Rights which will vest will be made by the auditor of the Company.

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AI assistant

QORIA LIMITED — Proxy Solicitation & Information Statement 2021

65649_rns_2021-05-05_c2c9128c-21d3-4e39-a7b8-6b0cb2ed8793.pdf

NOTICE OF GENERAL MEETING

NOTICE OF GENERAL MEETING

AGENDA

1. Resolution 1 – Ratification of issue of Placement Shares under Listing Rule 7.1 capacity

Voting Exclusion

2. Resolution 2 – Ratification of issue of Placement Shares under Listing Rule 7.1A capacity

Voting Exclusion

3. Resolution 3 – Ratification of issue of Shares to Netsweeper

Voting Exclusion

4. Resolution 4 – Grant of Director Securities to Tim Levy

Voting Exclusion and Prohibition

5. Resolution 5 – Grant of Director Performance Rights to Crispin Swan

Voting Exclusion and Prohibition

6. Resolution 6 – Grant of Director Options to Peter Pawlowitsch

Voting Exclusion and Prohibition

7. Resolution 7– Approval of the Amendment to the terms of Existing Performance Rights issued to Directors and Senior Executives

Voting Exclusion and Prohibition

EXPLANATORY MEMORANDUM

1. Introduction

2. Action to be taken by Shareholders

2.1 Proxies

3. Resolutions 1 and 2 – Ratification of Placement Shares

3.1 General

3.2 Information required by Listing Rule 7.5

(the Placement Participants )

4. Resolution 3 – Ratification of issue of Shares to Netsweeper

4.1 General

4.2 Information required by Listing Rule 7.5

5. Resolutions 4, 5 and 6 – Grant of Director Securities

5.1 Background

Fixed remuneration

Short Term Incentives

Longer Term Incentives

Reward Incentive

5.2 Proposed grant of Director Securities to Directors

5.3 Listing Rule 10.14

5.4 Chapter 2E of the Corporations Act

5.5 Information required by Listing Rule 10.15

Notes

6. Resolution 7 – Approval of the Amendment to the terms of Existing Performance Rights issued to Directors and Senior Executives

6.1 Background

7. Definitions

Schedule 1: Key Terms and Conditions of Performance Rights

a. Vesting Conditions

STI 2022 Performance Rights

STI 2023 Performance Rights

LTI Performance Rights

b. Issue of Shares

c. Expiry Date

d. Notice of Exercise

e. Lapse Date

f. Leaving the Company Group

2. Other rights attaching to Performance Rights

Schedule 2: Key Terms and Conditions of Director Options

1. Entitlement

2.

Exercise Price and Expiry Date

3. Lapse Date

4. Leaving the Company Group

5. Change in Control

6. Exercise Period

7. Notice of Exercise

8. Cashless Exercise Facility

9.

Shares issued on exercise

10. Quotation of Shares on exercise

11.

Timing of issue of Shares

(a) issue the Share;

12. Participation in new issues

14. Adjustment for rights issue

15. Adjustments for reorganisation

16. Quotation of Options

17. Options not transferable

18. Lodgement Instructions

Schedule 3: Summary of the Plan

1. Eligible Participant

QORIA LIMITED Proxy Solicitation & Information Statement 2021