READCLOUD LIMITED — AGM Information 2018

Oct 25, 2018

READCLOUD LIMITED ACN 136 815 891

Notice of Annual General Meeting

Explanatory Statement and Proxy Form

Date of Meeting: Thursday, 29th November 2018

Time of Meeting: 10.00am (AEDT)

Place of Meeting: PKF Melbourne Level 12, 440 Collins Street Melbourne, Victoria, 3000

This Notice of Annual General Meeting and Explanatory Statement 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 advisor without delay

READCLOUD LIMITED

ACN 136 815 891

Registered office: Unit 1, 426 Glen Huntly Road, Elsternwick, Victoria 3185

NOTICE OF ANNUAL GENERAL MEETING

Notice is hereby given that the Annual General Meeting of shareholders of Readcloud Limited (the "Company") will be held at the offices of PKF Melbourne, Level 12, 440 Collins Street, Melbourne, Victoria, 3000 at 10.00am (AEDT) on Thursday, 29 November 2018 ("Annual General Meeting" or "Meeting").

AGENDA

The Explanatory Statement and proxy form which accompany and form part of this Notice, include defined terms and describe in more detail the matters to be considered. Please consider this Notice, the Explanatory Statement and the proxy form in their entirety.

ORDINARY BUSINESS

Receipt and consideration of Accounts & Reports

To receive and consider the financial report of the Company and the related reports of the Directors (including the Remuneration Report) and auditors for the year ended 30 June 2018.

Note: Except for as set out in Resolution 1, there is no requirement for shareholders to approve these reports. Accordingly no resolution will be put to shareholders on this item of business.

Resolution 1: Adoption of Remuneration Report

To consider and, if thought fit, to pass the following resolution as an ordinary resolution:

"That for the purpose of Section 250R(2) of the Corporations Act and for all other purposes, the Remuneration Report (included in the Directors' Report) for the financial year ended 30 June 2018 be adopted."

Resolution 2: Election of Mr Guy Mendelson as a Director of the Company

To consider and, if thought fit, pass the following resolution as an ordinary resolution:

"That Mr Guy Mendelson, having been appointed as a Director during the year, vacates office in accordance with the Constitution of the Company and, being eligible, offers himself for election as a Director of the Company."

Resolution 3: Re-election of Mr Paul Collins as a Director of the Company

To consider and, if thought fit, pass the following resolution as an ordinary resolution:

"That Mr Paul Collins, who retires by rotation pursuant to the Constitution of the Company and, being eligible, offers himself for re-election, be re-elected as a Director of the Company."

Resolution 4: Amendment to Employee Share Option Plan

To consider and, if thought fit, to pass the following resolution as an ordinary resolution:

"That shareholders approve an amendment to the Company's Employee Share Option Plan (ESOP) as detailed in the Explanatory Statement."

SPECIAL BUSINESS

Resolution 5: Approval of 10% Placement Facility

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

"That, pursuant to and in accordance with Listing Rule 7.1A and for all other purposes, shareholders approve the issue of Equity Securities up to 10% of the issued capital of the Company (at the time of the issue) calculated in accordance with the formula prescribed in Listing Rule 7.1A.2 and on the terms and conditions in the Explanatory Statement."

DATED this 18th day of October 2018 at Melbourne.

By order of the Board

Melanie Leydin Company Secretary

Notes

• 1. Entire Notice: The details of the resolutions contained in the Explanatory Statement accompanying this Notice of Meeting should be read together with, and form part of, this Notice of Meeting.
• 2. Record Date: The Company has determined that for the purposes of the Annual General Meeting, shares will be taken to be held by the persons who are registered as holding the shares at 7:00pm on the date 48 hours before the date of the Annual General Meeting. Only those persons will be entitled to vote at the Annual General Meeting and transfers registered after that time will be disregarded in determining entitlements to attend and vote at the Annual General Meeting.

3. Proxies

• a. Votes at the Annual General Meeting may be given personally or by proxy, attorney or representative.
• b. Each shareholder has a right to appoint one or two proxies.
• c. A proxy need not be a shareholder of the Company.
• d. If a shareholder is a company it must execute under its common seal or otherwise in accordance with its constitution or the Corporations Act.
• e. Where a shareholder is entitled to cast two or more votes, the shareholder may appoint two proxies and may specify the proportion of number of votes each proxy is appointed to exercise.
• f. If a shareholder appoints two proxies, and the appointment does not specify the proportion or number of the shareholder's votes, each proxy may exercise half of the votes. If a shareholder appoints two proxies, neither proxy may vote on a show of hands.
• g. A proxy must be signed by the shareholder or his or her attorney who has not received any notice of revocation of the authority. Proxies given by corporations must be signed in accordance with corporation's constitution and Corporations Act.
• h. To be effective, proxy forms must be received by the Company's share registry (Registry Direct Limited) no later than 48 hours before the commencement of the Annual General Meeting, this is no later than 10.00am (AEDT) on Tuesday, 27 November 2018. Any proxy received after that time will not be valid for the scheduled meeting.

4. Corporate Representative

Any corporate shareholder who has appointed a person to act as its corporate representative at the Meeting should provide that person with a certificate or letter executed in accordance with the Corporations Act authorising him or her to act as that company's representative. The authority may be sent to the Company and/or registry in advance of the Meeting or handed in at the Meeting when registering as a corporate representative.

5. Voting Exclusion Statement:

Resolution 1

The Company will disregard any votes cast on this resolution (in any capacity) by or on behalf of a member of the Key Management Personnel (being those persons described as such in the Remuneration Report) or a closely related party of such a member unless the vote cast as proxy for a person entitled to vote:

• (a) in accordance with a direction on the proxy form; or
• (b) by the Chairman of the meeting as proxy for a person entitled to vote and the Chairman has received express authority to vote undirected proxies as the Chairman sees fit.

Accordingly, if you intend to appoint a member of Key Management Personnel as your proxy, please ensure that you direct them how to vote. If you intend to appoint the Chairman of the meeting as your proxy, you can direct him to vote by marking the box for Resolution 1. By marking the Chairman's box on the proxy form you acknowledge that the Chairman of the meeting will vote in favour of this item of business as your proxy. The Chairman will vote undirected proxies in favour of Resolution 1.

Resolution 2 and 3

There are no voting exclusions on these Resolutions.

Resolution 4

The Company will disregard any votes cast in favour of this resolution (in any capacity) by or on behalf of:

• (a) any Director (other than a Director who is ineligible to participate in any Performance Share Rights scheme in relation to the Company);
• and (b) any of their associates.

However, the Company need not disregard any votes in favour of this resolution if:

• (a) it is cast by a person as proxy for a person who is entitled to vote, in accordance with the directions on the proxy form; or
• (b) it is cast by the Chairman of the meeting as proxy for a person entitled to vote and the Chairman has received express authority to vote undirected proxies as the Chairman sees fit.

Resolution 5

The Company will disregard any votes cast in favour of this Resolution by any person who may participate in the proposed issue or any person who might obtain a benefit, except a benefit solely in the capacity of a holder of ordinary shares, and any associate of such person.

6. Enquiries

Shareholders are invited to contact the Company Secretary, Melanie Leydin on (03) 9692 7222 if they have any queries in respect of the matters set out in these documents.

EXPLANATORY STATEMENT

Receipt and consideration of Accounts & Reports

A copy of the Annual Report for the financial year ending 30 June 2018 which incorporates the Company's financial report, reports of the Directors (including the Remuneration Report and the Auditor's Report) is not enclosed as there is no longer a requirement for the Company to incur the printing and distribution cost associated with doing so for all shareholders. You may obtain a copy free of charge in hard copy form by contacting the Company by phone at (03) 9692 7222, and you may request that this occurs on a standing basis for future years. Alternatively, you may access the Annual Report at the Company's website: www.readcloud.com or via the Company's announcement platform on ASX. Except as set out in Resolution 1, no resolution is required on these reports.

Resolution 1: Adoption of Remuneration Report

Background

Section 250R(2) of the Corporations Act requires that a resolution to adopt the remuneration report must be put to the vote at the Annual General Meeting. The vote on this Resolution is advisory only and does not bind the Directors or the Company.

The Remuneration Report is set out in the Directors' Report in the Company's 2018 Annual Report. The Remuneration Report sets out the Company's remuneration arrangements for the Directors and senior management of the Company.

In accordance with Section 250SA of the Corporations Act 2001, Shareholders will be provided with a reasonable opportunity to ask questions concerning, or make comments on, the remuneration report at the Annual General Meeting.

The Corporations Act requires the Company to put a resolution to Shareholders that, in accordance with Division 9 of Part 2G.2 of the Corporations Act, if twenty five (25%) per cent or more of votes that are cast are voted against the adoption of the Remuneration Report at two consecutive Annual General Meetings, Shareholders will be required to vote at the second of those Annual General Meetings on a resolution (a "spill resolution") that another meeting be held within 90 days at which all of the Company's Directors (other than the Managing Director) must go up for reelection.

Board Recommendation

The Board encourage all eligible shareholders to cast their votes in favour of Resolution 1. The Chairman of the meeting intends to vote undirected proxies in favour of Resolution 1.

Voting Exclusions

The Company will disregard any votes cast in favour of this resolution (in any capacity) by or on behalf of a member of the Key Management Personnel (being those persons described as such in the Remuneration Report) or a closely related party of such a member unless the vote cast as proxy for a person entitled to vote in accordance with a direction on the proxy form.

Any undirected proxies held by Directors or other Key Management Personnel or their closely related parties for the purposes of Resolution 1 (excluding the Chairman) will not be voted on Resolution 1. Accordingly, if you intend to appoint a member of Key Management Personnel as your proxy, please ensure that you direct them how to vote. If you intend to appoint the Chairman of the meeting as your proxy, you can direct him to vote by marking the box for Resolution 1. By marking the Chairman's box on the proxy form you acknowledge that the Chairman of the meeting will vote in favour of this item of business as your proxy.

Resolution 2: Election of Mr Guy Mendelson as a Director of the Company

Background

Mr Guy Mendelson was appointed as a Non-Executive Director on 14 May 2018 as a casual vacancy and is eligible for election under the Company's Constitution.

Mr Mendelson was a member of the ReadCloud Advisory Board for three years prior to the Company's IPO in February 2018. Mr Mendelson was a Director of BPAY for four years and a member of the Brotherhood of St Laurence Audit and Risk Committee for eight years. He has spent the last 19 years at ANZ Bank running various businesses, and is currently a General Manager responsible for the growth and profitability of ANZ's small business segment.

Directors Recommendation

The Board (with Mr Mendelson abstaining), recommends that shareholders vote in favour of the election of Mr Mendelson. The Chairman of the meeting intends to vote undirected proxies in favour of Mr Mendelson's election.

Voting Exclusions

There are no voting exclusions on this Resolution.

Resolution 3: Re-election of Mr Paul Collins as a Director of the Company

Background

The Constitution of the Company requires that at every Annual General Meeting, one third of Directors (excluding the Managing Director) shall retire from office and provides that such Directors are eligible for re-election at the meeting. Mr Paul Collins being eligible, offers himself for re-election.

Mr Collins was appointed as a Non-Executive Director of the Company on 2 August 2017.

Mr Collins commenced his career with IBM in 1982. After 3 years he started his own consulting business working in a state government agency and large corporations primarily in software development and implementation roles. This included 7 years at IOOF in the Development Manager's role. Over the last 20 years, Paul has been extensively involved in the start-up and subsequent ASX listing of 2 successful FinTech companies. A co-founder of IWL in 1997, Paul was an Executive Director of the company from its inception, through its listing in 1999 before leaving in 2004. Later in 2004, Paul was a co-founder and Executive Director of Managed Accounts Ltd which listed on the ASX in 2014 (ASX:MGP). Paul chaired the Audit and the Risk and Compliance Committees of MGP from 2009 until 2016.

Board Recommendation

The Board (with Mr Collins abstaining), recommends that shareholders vote in favour of the re-election of Mr Collins The Chairman of the meeting intends to vote undirected proxies in favour of Mr Collins's re-election.

Voting Exclusions

There are no voting exclusions on this Resolution.

Resolution 4: Amendment to Employee Share Option Plan

Background

The Company is seeking Shareholder approval to include an additional clause to clarify the Board's intention regarding the number of options that may be issued pursuant to the Company's Employee Share Option Plan.

This resolution seeks to insert an additional clause to the Employee Share Option Plan Rules as follows:

"4.5 Dilution limit

An Offer of Options must not be made if the total of:

• (a) the number of Shares which are the subject of the Offer of Options; and
• (b) underlying Shares issued or that may be issued as a result of any Offers of Options, or similar offer of Shares under a predecessor or other employee incentive plan, made at any time during the previous 3-year period in reliance of Class Order relief granted by ASIC

would exceed 5% of the number of Shares on issue at the time of the Offer."

All other clauses in the Employee Share Option Plan Rules remain unchanged.

Board Recommendation

The Board recommends that Shareholders vote in favour of Resolution 4.

Voting Exclusions

The Company will disregard any votes cast in favour of this resolution (in any capacity) by or on behalf of:

• (a) any Director (other than a Director who is ineligible to participate in any Performance Share Rights scheme in relation to the Company); and
• (b) any of their associates.

However, the Company need not disregard any votes in favour of this resolution if:

• (a) it is cast by a person as proxy for a person who is entitled to vote, in accordance with the directions on the proxy form; or
• (b) it is cast by the Chairman of the meeting as proxy for a person entitled to vote and the Chairman has received express authority to vote undirected proxies as the Chairman sees fit.

Resolution 5: Approval of 10% Placement Facility

Background

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 ("10% Placement Facility"). The 10% Placement Facility is in addition to the Company's 15% placement capacity under Listing Rule 7.1.

An eligible entity for the purposes of Listing Rule 7.1A is an entity that is not included in the S&P/ASX 300 Index and has a market capitalisation of $300 million or less. The Company is an eligible entity.

The Company is seeking shareholder approval by way of a special resolution to have the ability, if required, to issue Equity Securities under the 10% Placement Facility. The effect of Resolution 5 will be to allow the Directors to issue Equity Securities under Listing Rule 7.1A during the 10% Placement Period without using the Company's 15% placement capacity under Listing Rule 7.1.

If Shareholders approve Resolution 5, the number of Equity Securities permitted to be issued under the 10% Placement Facility will be determined in accordance with the formula prescribed in Listing Rule 7.1A.2 (see below).

Resolution 5 is a special resolution and therefore requires approval of 75% of the votes cast by Shareholders present and eligible to vote at this Meeting (in person, by proxy, by attorney or, in the case of a corporate Shareholder, by a corporate representative).

Description of Listing Rule 7.1A

(a) Shareholder approval

The ability to issue Equity Securities under the 10% Placement Facility is subject to shareholder approval by way of a special resolution at an Annual General Meeting. This means it requires approval of 75% of the votes cast by shareholders present and eligible to vote (in person, by proxy, by attorney or, in the case of a corporate shareholder, by a corporate representative).

(b) Equity Securities

Any Equity Securities issued under the 10% Placement Facility must be in the same class as an existing quoted class of Equity Securities of the Company.

The Company, as at the date of the Notice, has on issue Fully Paid Ordinary Shares, Listed and Unlisted Options.

(c) Formula for calculating 10% Placement Facility

Listing Rule 7.1A.2 provides that eligible entities which have obtained shareholder approval at an Annual General Meeting may issue or agree to issue, during the 12 month period after the date of the Annual General Meeting, a number of Equity Securities calculated in accordance with the following formula:

(A x D)–E

• A is the number of shares on issue 12 months before the date of issue or agreement:

  • (A) plus the number of fully paid shares issued in the 12 months under an exception in Listing Rule 7.2;

• (B) plus the number of partly paid shares that became fully paid in the 12 months;

• (C) plus the number of fully paid shares issued in the 12 months with approval of holders of shares under Listing Rules 7.1 and 7.4. This does not include an issue of fully paid shares under the entity's 15% placement capacity without shareholder approval;

• (D) less the number of fully paid shares cancelled in the 12 months.

Note that A has the same meaning in Listing Rule 7.1 when calculating an entity's 15% placement capacity.

• D is 10%
• E is the number of Equity Securities issued or agreed to be issued under Listing Rule 7.1A.2 in the 12 months before the date of the issue or agreement to issue that are not issued with the approval of shareholders under Listing Rule 7.1 or 7.4.
• (d) Listing Rule 7.1 and Listing Rule 7.1A

The ability of an entity to issue Equity Securities under Listing Rule 7.1A is in addition to the entity's 15% placement capacity under Listing Rule 7.1.

The actual number of Equity Securities that the Company will have capacity to issue under Listing Rule 7.1A will be calculated at the date of issue of the Equity Securities in accordance with the formula prescribed in Listing Rule 7.1A.2

(e) Minimum Issue Price

The issue price of Equity Securities issued under Listing Rule 7.1A must be not less than 75% of the VWAP of Equity Securities in the same class calculated over the 15 trading days immediately before:

• (i) the date on which the price at which the Equity Securities are to be issued is agreed; or
• (ii) if the Equity Securities are not issued within 5 trading days of the date in paragraph (i) above, the date on which the Equity Securities are issued.

(f) 10% Placement Period

Shareholder approval of the 10% Placement Facility under Listing Rule 7.1A is valid from the date of the Annual General Meeting at which the approval is obtained and expires on the earlier to occur of:

• (i) the date that is 12 months after the date of the Annual General Meeting at which the approval is obtained; or
• (ii) the date of the approval by shareholders of a transaction under Listing Rules 11.1.2 (a significant change to the nature or scale of activities) or 11.2 (disposal of main undertaking),

(10% Placement Period).

Listing Rule 7.1A

The effect of Resolution 5 will be to allow the Directors to issue the Equity Securities under Listing Rule 7.1A during the 10% Placement Period without using the Company's 15% placement capacity under Listing Rule 7.1.

Resolution 5 is a special resolution and therefore requires approval of 75% of the votes cast by Shareholders present and eligible to vote (in person, by proxy, by attorney or, in the case of a corporate Shareholder, by a corporate representative).

Specific information required by Listing Rule 7.3A

Pursuant to and in accordance with Listing Rule 7.3A, information is provided in relation to the approval of the 10% Placement Facility as follows:

• (a) The Equity Securities will be issued at an issue price of not less than 75% of the VWAP for the Company's Equity Securities over the 15 trading days immediately before:

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

• (ii) if the Equity Securities are not issued within 5 trading days of the date in paragraph (i) above, the date on which the Equity Securities are issued.

• (b) If Resolution 5 is approved by Shareholders and the Company issues Equity Securities under the 10% Placement Facility, the existing Shareholders' voting power in the Company will be diluted as shown in the below table. Shareholders may be exposed to economic risk and voting dilution, including the following:

  • (i) the market price for the Company's Equity Securities may be significantly lower on the date of the issue of the Equity Securities than on the date of the Annual General Meeting; and
  • (ii) the Equity Securities may be issued at a price that is at a discount to the market price for the Company's Equity Securities on the issue date,

which may have an effect on the amount of funds raised by the issue of the Equity Securities.

The below table shows the dilution of existing Shareholders on the basis of the market price of Shares as at 8 October 2018 (Current Share Price) and the current number of ordinary securities for variable "A" calculated in accordance with the formula in Listing Rule 7.1A(2) as at the date of this Notice.

The table also shows:

• two examples where variable "A" has increased, by 50% and 100%. Variable "A" is based on the number of ordinary securities the Company has on issue. The number of ordinary securities on issue may increase as a result of issues of ordinary securities that do not require Shareholder approval (for example, a pro rata entitlements issue or scrip issued under a takeover offer) or future specific placements under Listing Rule 7.1 that are approved at a future Shareholders' meeting; and
• two examples of where the issue price of ordinary securities has decreased by 50% and increased by 100% as against the current market price.

		Issue Price
Variable 'A' in ListingRule 7.1A.2		$0.18850% decrease inCurrent SharePrice	$0.375Current SharePrice	$0.750100% increase inCurrent SharePrice
Current Variable A87,500,000 Shares	10%VotingDilution	8,750,000Shares	8,750,000Shares	8,750,000Shares
	Fundsraised	$1,640,625	$3,281,250	$6,562,500
50% increase in currentVariable A131,250,000 Shares	10%VotingDilution	13,125,000Shares	13,125,000Shares	13,125,000Shares
	Fundsraised	$2,460,938	$4,921,875	$9,843,750
100% increase in currentVariable A175,000,000 Shares	10%VotingDilution	17,500,000Shares	17,500,000Shares	17,500,000Shares
	Fundsraised	$3,281,250	$6,562,500	$13,125,000

The table has been prepared on the following assumptions:

• The Company issues the maximum number of Equity Securities available under the 10% Placement Facility.

• No Options (including any Options issued under the 10% Placement Facility) are exercised into Shares before the date of the issue of the Equity Securities;

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

• The table does not show an example of dilution that may be caused to a particular Shareholder by reason of placements under the 10% Placement Facility, based on that Shareholder's holding at the date of the Annual General Meeting.

• The table shows only the effect of issues of Equity Securities under Listing Rule 7.1A, not under the 15% placement capacity under Listing Rule 7.1.

• The issue of Equity Securities under the 10% Placement Facility consists only of Shares. If the issue of Equity Securities includes Options, it is assumed that those Options are exercised into Shares for the purpose of calculating the voting dilution effect on existing Shareholders.

• The Current Share Price is $0.375 (37.5 cents), being the closing price of the Shares on ASX on 8 October 2018.

• (c) The Company will only issue and allot the Equity Securities during the 10% Placement Period. The approval under Resolution 5 for the issue of the Equity Securities will cease to be valid in the event that Shareholders approve a transaction under Listing Rule 11.1.2 (a significant change to the nature or scale of activities or Listing Rule 11.2 (disposal of main undertaking).

• (d) The Company may seek to issue the Equity Securities for the following purposes:

  • (i) non-cash consideration for the acquisition of the new assets and investments. In such circumstances the Company will provide a valuation of the non-cash consideration as required by Listing Rule 7.1A.3; or
  • (ii) cash consideration. In such circumstances, the Company intends to use the funds raised towards an acquisition of new assets or investments (including expense associated with such acquisition), continued expenditure on the Company's current business and/or general working capital.

• (e) The Company will comply with the disclosure obligations under Listing Rules 7.1A(4) and 3.10.5A upon issue of any Equity Securities.

The Company's allocation policy is dependent on the prevailing market conditions at the time of any proposed issue pursuant to the 10% Placement Facility. The identity of the allottees of Equity Securities will be determined on a case-by-case basis having regard to the factors including but not limited to the following:

• (i) the methods of raising funds that are available to the Company, including but not limited to, rights issue or other issue in which existing security holders can participate;
• (ii) the effect of the issue of the Equity Securities on the control of the Company;
• (iii) the financial situation and solvency of the Company; and
• (iv) advice from corporate, financial and broking advisers (if applicable).

The allottees under the 10% Placement Facility have not been determined as at the date of this Notice but may include existing substantial Shareholders and/or new Shareholders who are not related parties or associates of a related party of the Company.

Further, if the Company is successful in acquiring new businesses, assets or investments, it is likely that the allottees under the 10% Placement Facility will be the vendors of the new businesses, assets or investments.

(f) A voting exclusion statement is included in the Notice. At the date of this Notice, the Company has not approached any particular existing Shareholder or security holder or an identifiable class of existing security holder to participate in the issue of the Equity Securities. No existing Shareholder's votes will therefore be excluded under the voting exclusion in this Notice.

Board Recommendation

The Board believes that Resolution 5 is in the best interests of the Company and unanimously recommends that shareholders vote in favour of this Resolution.

Voting Exclusions

The Company will disregard any votes cast in favour of Resolution 5 by any person who may participate in the proposed issue or any person who might obtain a benefit, except a benefit solely in the capacity of a holder of ordinary shares, and any associate of such person.

GLOSSARY

The following terms have the following meanings in this Explanatory Statement:

"$" means Australian Dollars;

"10% Placement Facility" has the meaning as defined in the Explanatory Statement for Resolution 5;

"10% Placement Period" has the meaning as defined in the Explanatory Statement for Resolution 5;

"Annual Report" means the Directors' Report, the Financial Report, and Auditor's Report, in respect to the year ended 30 June 2018;

"ASX" means ASX Limited ABN 98 008 624 691 or the Australian Securities Exchange, as the context requires;

"ASX Settlement Operating Rules" means the rules of ASX Settlement Pty Ltd which apply while the Company is an issuer of CHESS approved securities;

"Auditor's Report" means the auditor's report on the Financial Report;

"AEDT" means Australian Eastern Daylight Time.

"Board" means the Directors acting as the board of Directors of the Company;

"Chairman" means the person appointed to chair the Meeting of the Company convened by the Notice;

"CHESS" has the meaning in Section 2 of the ASX Settlement Operating Rules**;**

"Closely Related Party" means:

• (a) a spouse or child of the member; or
• (b) has the meaning given in section 9 of the Corporations Act.

"Company" means ReadCloud Limited ACN 136 815 891;

"Constitution" means the constitution of the Company as at the date of the Meeting;

"Corporations Act" means the Corporations Act 2001 (Cth);

"Director" means a Director of the Company;

"Directors Report" means the annual directors' report prepared under Chapter 2M of the Corporations Act for the Company and its controlled entities;

"ESOP" means Employee Share Option Plan;

"Equity Security" has the same meaning as in the Listing Rules;

"Explanatory Memorandum" means the explanatory memorandum which forms part of the Notice;

"Financial Report" means the annual financial report prepared under Chapter 2M of the Corporations Act for the Company and its controlled entities;

"Key Management Personnel" means persons having authority and responsibility for planning, directing and controlling the activities of the Company, directly or indirectly, including any Director (whether executive or otherwise) of the Company;

"Listing Rules" means the Listing Rules of the ASX;

"Meeting" has the meaning given in the introductory paragraph of the Notice;

"Notice" means this Notice of Meeting including the Explanatory Statement;

"Proxy Form" means the proxy form attached to the Notice;

"Remuneration Report" means the remuneration report which forms part of the Directors' Report of the Company for the financial year ended 30 June 2018 and which is set out in the 2018 Annual Report.

"Resolution" means a resolution referred to in the Notice;

"Section" means a section of the Explanatory Memorandum;

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

"Shareholder" means shareholder of the Company;

"Trading Day" means a day determined by ASX to be a trading day in accordance with the Listing Rules; and

"VWAP" means volume weighted average price.

Investor Name C/O Example Ltd PO BOX 0000 MELBOURNE VIC 3000

SAVE TIME & VOTE ONLINE: registrydirect.com.au/investor

To find out your options on how to lodge this form, see the voting instructions at the end of this form.

ReadCloud Limited ABN 44 136 815 891

SRN/HIN: <SRN/HIN>

VOTE / PROXY FORM

A meeting of the members of ReadCloud Limited will take place at: PKF Melbourne Level 12 440 Collins Street Melbourne VIC 3000 at 10:00 a.m. AEDT on Thursday, 29 November 2018 (Registration commences at 9:30 a.m.)

Please complete this form in order to direct your proxy (Proxy) how to vote. While it is not compulsory to vote, if you do not complete this form (directly or online) or vote in person at the meeting, then your vote will not be counted. By default, by executing this form you appoint the chairman of the meeting (Chairman) to be your Proxy. If you wish to appoint a party other than the Chairman to act as your Proxy, please provide their details below. Please indicate overleaf how you would like your votes directed.

Proxy appointments will be valid and accepted only if they are signed and received no later than 10:00 a.m. AEDT on Tuesday, 27 November 2018.

APPOINT ALTERNATE PROXY (OPTIONAL)
PROXY NAME:	MOBILE/TELEPHONE NUMBER:
Full Name/Body Corporate Name
ABN/ACN (If proxy is a body corporate):	EMAIL ADDRESS:

If your Proxy is a body corporate, please arrange for the body corporate to bring an executed Appointment of Corporate Representative Form to the meeting. To download form: www.registrydirect.com.au/wp-content/uploads/2016/05/appointment\_of\_corporate\_representative.pdf

APPOINT MULTIPLE PROXIES OR SPLIT VOTING DIRECTION (OPTIONAL)

To appoint more than one Proxy or split the voting directions, please print and complete an additional copy of this form. Please indicate in the space provided below the number of securities in which the Proxy is authorised to vote. No Proxy may be authorised to exercise votes which any other Proxy has been authorised to exercise. Multiple Proxy appointments and split voting directions should be returned together in the same envelope/email to the Registrar.

Number of securities Proxy is authorised to vote:

If left blank then all securities held

If the person/body corporate named as your Proxy fails to attend the meeting, or if no person/body corporate is named, the Chairman, as my/our Proxy is permitted to vote for me/us on my/our behalf in accordance with the directions below or if no directions have been given, as the Proxy sees fit at the Meeting and at any adjournment or postponement of the Meeting or at any other meeting of the Company to consider the same or substantially similar resolutions to those proposed to be put at the Meeting.

Please note, if the Chairman of the Meeting is appointed as your Proxy (or becomes your Proxy by default), the Chairman of the Meeting intends to vote undirected proxies in the manner set out with each resolution below.

Resolution 1
ADOPTION OF REMUNERATION	FOR	AGAINST	ABSTAIN	PROXY'S DISCRETION
REPORT
Resolution type: Ordinary
Board recommendation: For
Chairman's voting intention: For
Resolution 2
ELECTION OF MR GUY MENDELSON	FOR	AGAINST	ABSTAIN	PROXY'S DISCRETION
AS A DIRECTOR OF THE COMPANY
Resolution type: Ordinary
Board recommendation: For
Chairman's voting intention: For
Resolution 3
RE-ELECTION OF MR PAUL COLLINS	FOR	AGAINST	ABSTAIN	PROXY'S DISCRETION
AS A DIRECTOR OF THE COMPANY
Resolution type: Ordinary
Board recommendation: For
Chairman's voting intention: For
Resolution 4
AMENDMENT TO EMPLOYEE SHARE	FOR	AGAINST	ABSTAIN	PROXY'S DISCRETION
OPTION PLAN
Resolution type: Ordinary
Board recommendation: For
Chairman's voting intention: For
Resolution 5
APPROVAL OF 10 PERCENT	FOR	AGAINST	ABSTAIN	PROXY'S DISCRETION
PLACEMENT FACILITY
Resolution type: Special
Board recommendation: For
Chairman's voting intention: For

SIGNATURE OF SHAREHOLDERS - MUST BE COMPLETED

Shareholder 1 (individual)	Joint Shareholder 2 (individual)	Joint Shareholder 3 (individual)
Sole Director & Sole Company Secretary	Director/Company Secretary(Delete one)	Director
Date

SIGNING INSTRUCTIONS: This form should be signed by the security holder. If a joint holding, all security holders should sign. If signed by the security holder's attorney, the power of attorney must have been previously noted by the registrar or a certified copy attached to this form. If executed by a company, the form must be executed in accordance with the company's constitution and the Corporations Act 2001 (Cth) (or for New Zealand companies, the Companies Act 1993).

HOW TO LODGE THIS FORM

ONLINE:

registrydirect.com.au/investor

Login to the Registry Direct website, click on the 'Votes' tab to find a meeting and follow the prompts to lodge your vote.

If you do not have an account, go to registrydirect.com.au/registration-page and fill out the registration form.

To register, you will need a "Holder Number" (Securityholder Reference Number (SRN), a Holder Identification Number (HIN) or Share Certificate Number as shown on the front of the Proxy Form).

POST:

PO Box 18366 Collins Street East Melbourne VICTORIA 8003

EMAIL:

registry@registrydirect.com.au