VECTION TECHNOLOGIES LTD — Capital/Financing Update 2020

Sep 6, 2020

7 September 2020 | Australia

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ASX RELEASE

VECTION ACHIEVES GOVERNMENT FUNDING ~ MILESTONE AND SECURES $2.6M

• Real-time software company Vection Technologies Ltd ( ASX:VR1 ) ( Vection Technologies , Vection or the Company ) is pleased to announce it has secured ~$2.6M in non-dilutive funding, including a ~$1.1M[1] interest-free working capital facility from the Italian Government’s National Agency for Investment Attraction and Business Development[2] ( Invitalia ). Highlights: 3D

• ● Vection secures a ~$1.1M[1] interest-free facility from Invitalia, of which: ○ ~ 30% Non-repayable ○ ~ 70% Interest-free, repayable in 10 years

• ● Invitalia is the Italian National Agency for Inward Investment and Economic Development, VIRTUALREALITY with circa ~$12[1] billion in invested funds

• ● Invitalia is a related party to CPD Venture, the Italian Government’s national innovation fund and a substantial shareholder in Vection Technologies

• ● Additional funding adds to the ~$0.5M E.U. grant (Horizon 2020 Grant) milestone, AUGMENTED commencing in October 2020 REALITY

• ● ~$1.5M raised through the utilisation of the Controlled Placement Agreement (CPA) (ASX: 24 June 2019)

• ● CPA funding increases cash at bank to ~$3M, inclusive of cash balance at 30 June 2020, but excluding Invitalia funding and Horizon 2020 Grant INDUSTRIAL IoT

• ● Termination of the CPA with no further costs associated ● Company has delivered on its Smart Capital Strategy, ensuring a non-dilutive, value accretive outcome for its stakeholders

• ● Capital structure remains unvaried with 837.7M fully paid ordinary shares on issue CAD ● Company has secured a robust treasury foundation for its current global growth strategy

• Invitalia Funding Overview:

Aligned with its Smart Capital Strategy, Vection Technologies has secured an interest-free working capital facility from the Italian Government’s National Agency for Investment Attraction and Business Development, through its Mindesk division. ( Facility )

incurred expenditure and over a maximum period of two years, to accelerate the development and commercialisation of the Mindesk product suite. On a total expenditure of ~$1.4M, the Company will receive ~$1.1M in funding, of which 30% non-repayable and 70% repayable in 10 years at nil interest.

• 1 AUD/€ Exchange rate of 0.6134 at 4 September 2020 (Source: Reserve Bank of Australia)

• 2 Invitalia - Agenzia nazionale per l'attrazione degli investimenti e lo sviluppo d'impresa S.p.A

Vection Technologies Ltd (ASX:VR1) ACN: 614 814 041

Europe North America Address: Via Isonzo 61 Address: 785 Market Street, #600 40033 Casalecchio di Reno (BO), San Francisco CA 94103 Italy USA

Media Enquiries AUpress@vection.com.au EUpress@vection.com.au

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Address: Suite 1, 437 Roberts Road Subiaco WA 6008, Australia Phone: +618 6380 2555

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Invitalia is the National Agency for Inward Investment and Economic Development, owned by the Italian Ministry of Economy, with circa ~$12[1] billion in invested funds. (invitalia.it/eng)

Invitalia controls 30% of CDP Venture Capital SGR SpA ( CDP Venture ), the Italian Government’s national innovation fund and a substantial shareholder in the Company with 6.29% of the issued capital. CDP Venture currently has $1.21 billion in assets under management. (en.cdpventurecapital.it)

The remaining 70% of CDP Venture is controlled by CDP Equity SpA, the Italian Government’s sovereign wealth fund, with $4.7[1] billion invested across strategic companies including WeBuild, Ansaldo Energia, Open Fiber and SIA. (en.cdpequity.it)

The Facility adds to the existing Smart Capital Strategy milestones achieved by the Company during the last 5 months, including the execution of a ~$3.2M E.U. grant (Horizon 2020 Grant) for the PrismArch project, of which $0.5M will flow directly to the Company. (ASX: 27 May 2020)

Strategy, as initially announced on 6 April 2020.

Controlled Placement Agreement $1.485M raised & CPA termination:

The Company has utilised its Controlled Placement Agreement ( CPA ) with Acuity Capital to raise $1.485 million (inclusive of costs) through the set-off 32M shares in the Company ( Set-off Shares ).

These Set-off Shares have a deemed price of $0.0464 representing a 14.95% discount to the 15-day VWAP to 4 September 2020 (inclusive).

The funds raised will be used towards additional working capital.

The Company also advises that it has now terminated the CPA effective immediately. There were no costs associated with terminating the CPA.

The Set-off Shares reduces the total 32M Collateral Shares that Acuity Capital was otherwise required to return to the Company upon maturity or early termination of the CPA. The Company also confirms it has been released from any and all obligations under the CPA.

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3D VIRTUAL REALITY

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AUGMENTED REALITY INDUSTRIAL IoT CAD

Corporate Overview:

Vection’s capital structure remains unvaried, with 837.7M fully paid ordinary shares on issue, aligned with its commitment to deliver non-dilutive value accretive outcomes for all stakeholders.

These initiatives further reinforce the existing cash balance to ~$3M, inclusive of the cash balance at 30 June 2020, but excluding the Invitalia funding and Horizon 2020 Grant, providing for a more robust treasury foundation to support the current global growth strategy.

Vection Technologies Ltd (ASX:VR1) ACN: 614 814 041

Europe Address: Via Isonzo 61 40033 Casalecchio di Reno (BO), Italy

North America Address: 785 Market Street, #600 San Francisco CA 94103 USA

Media Enquiries AUpress@vection.com.au EUpress@vection.com.au

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Address: Suite 1, 437 Roberts Road Subiaco WA 6008, Australia Phone: +618 6380 2555

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Investor Relations Contact Details

Gianmarco Biagi - Managing Director (Europe Based) Email: gianmarco.biagi@vection.com.au Phone: +39 051 0142248

Gianmarco Orgnoni - Director and COO (Australia Based) Email: gianmarco.orgnoni@vection.com.au Phone: +61 8 6380 2555

ENDS

About Vection Technologies:

Vection Technologies Ltd (ASX:VR1) is a multinational software company that focuses on real-time technologies for industrial companies’ digital transformation.

Through a combination of our 3D, Virtual Reality, Augmented Reality, Industrial IoT and CAD solutions, Vection Technologies helps companies and organisations to innovate, collaborate and create value.

For more information please visit the Company’s websites:

vection.com.au

mindeskvr.com

ASX release authorised by the Board of Directors of Vection Technologies Ltd.

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3D VIRTUAL REALITY AUGMENTED REALITY INDUSTRIAL IoT CAD

Vection Technologies Ltd (ASX:VR1) ACN: 614 814 041

Europe Address: Via Isonzo 61 40033 Casalecchio di Reno (BO), Italy

Media Enquiries AUpress@vection.com.au EUpress@vection.com.au

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North America Address: 785 Market Street, #600 San Francisco CA 94103 USA

Address: Suite 1, 437 Roberts Road Subiaco WA 6008, Australia Phone: +618 6380 2555