VECTION TECHNOLOGIES LTD — Capital/Financing Update 2020

May 26, 2020

27 May 2020 | Australia

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ASX RELEASE

3 VIRT REA AUGM REA INDUS Io CA E.U. GRANT MILESTONE ACHIEVED Real-time software company Vection Technologies Ltd (ASX:VR1) (Vection Technologiesor the Company) is pleased to advise on the execution of a ~$3.2M1Horizon 2020 non-refundable grant between the European Commission and a Company-participated consortium for the development of a multidisciplinary Virtual Reality (VR) platform (PrismArch) (Grant). Vection Technologies previously announced the receipt of a grant preparation invitation letter on 6 April 2020. Highlights: ● Execution of ~$3.2M1 E.U. grant (Horizon 2020 Grant) for the PrismArch project, of which $0.5M1 will fow directly to the Company ● Achievement of an additional milestone in the Company’s smart capital strategy, ahead of its mid-June 2020 schedule ● Consortium participants include the Centre for Research and Technology Hellas, Zaha Hadid Virtual Reality Group, the University of Malta, the Swiss Federal Institute of Technology, AKT II Limited and SWECO II Limited ● Vection Technologies to integrate additional CAD, CAE and BIM software to its Mindesk real-time software ● Initial funding to be received by the end of October 2020, being 80% of total Grant value ● Company to retain the totality of the intellectual property it develops under the Grant ● Divisional focussed treasury strategy underway, with further smart-capital funding initiatives of over ~$2M Horizon 2020 Grant: Framework Programme Horizon 2020 is the biggest EU Research and Innovation program ever with nearly €80 billion of funding available over 7 years (2014 to 2020). Horizon 2020 funding is part of the Innovation Union, a Europe 2020 fagship initiative aimed at securing Europe’s global competitiveness. The Consortium Besides the Company, the consortium includes the Centre for Research and Technology Hellas as coordinator, Zaha Hadid Virtual Reality Group, the University of Malta, the Swiss Federal Institute of Technology, AKT II Limited and SWECO UK Limited (Consortium). The Project The project subject of the Grant, called PrismArch, aims to develop a multi-discipline Virtual Reality	D UAL LITY
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The project subject of the Grant, called PrismArch, aims to develop a multi-discipline Virtual Reality software that will enable architects and structural, mechanical, electrical and piping engineers to collaborate and jointly decide, preview and assess the outcome of their decisions in a Virtual Reality universal software solution.

1 AUD/€ exchange rate of 0.6022 at 26 May 2020 (Source: Reserve Bank of Australia)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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Through PrismArch, designers, architects and engineers will be able to experience, in real-time, how their decisions affect both their own and other disciplines via a discipline-specific and personalized point of view.

Company’s Role

Vection Technologies will develop the novel VR component in the PrismArch project including the design of the interface between the user and the platform, the seamless integration between all components (e.g., simulations and 3D models) and the implementation of a light cognition load user experience.

Vection Technologies will use the outcome of this research to include additional Computer Aided Design ( CAD ), Computer Aided Engineering ( CAE ) and Building Information Modelling ( BIM ) software into its real-time Mindesk software and increase the overall quality and performance of its user experience, while providing for stronger commercial opportunities.

https://www.youtube.com/watch?v=w-pv4swNsic. 3D Funding The non-refundable Grant of ~$3.5M will be disbursed as follows: ● ~80% of the total Grant value by the end of October 2020; and VIRTUAL REALITY ● The remainder disbursed on a working-progress basis over a period of 24 months from 1 November 2020. Although the Consortium as a whole will receive comercial benefits from the development of the PrismArch platform, each party to the Consortium will receive a predetermined funding allocation AUGMENTED REALITY based on their resources’ commitment, with Mindesk receiving ~$0.5M[1] for its VR component. Intellectual Property Vection Technologies will own all newly developed expertise, knowledge and technologies it develops, pursuant to the Grant and the Consortium agreements’ terms and conditions. INDUSTRIAL IoT Smart Capital Initiatives Update: The execution of the European Commission Grant represents an additional milestone in the CAD Company’s overarching smart capital initiatives strategy to secure a stronger cash position across each of the Company’s international subsidiaries to ensure a robust framework for future growth.

Following the achievement of this additional milestone, Vection Technologies is now progressing on the finalisation of its remaining smart capital activities:

● Italian Government Loan: up to ~$2.0M, 30% non-repayable and 70% repayable after 10 years at nil interest; ● Commercial Loan: ~$0.4M, long-term at commercial interest rates;

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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Gianmarco Biagi, Managing Director of Vection Technologies, commented:

“The execution of the grant agreement with the European Commission represents the achievement of a further milestone in the Company’s overarching smart capital strategy to ensure a robust framework for future growth.

This grant will enable the Company to pursue, at no additional cost, novel commercial opportunities in the AEC market segment through the integration of its Mindesk software with industry-leading CAD, CAE and BIM software.”

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

About the Mindesk software:

Vection Technologies’ Mindesk, is a real-time 3D design platform that integrates with existing commercial CAD software to extend their operations to the third-dimension: virtual reality, augmented reality, real-time rendering, and multi-user collaboration. Mindesk introduces the possibility to design a CAD project from scratch in Virtual Reality: while the majority of VR CAD software commercially available require time consuming project exportation, Mindesk enables users to switch from VR to desktop seamlessly, while editing the project in real-time on either platform. Mindesk provides the bi-directional, real-time live link across multiple commercial CAD and design software, including McNeel Rhinoceros 6, Dassault Solidworks 2018 and 2019 and Epic Games Unreal Editor.

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3D VIRTUAL REALITY AUGMENTED REALITY INDUSTRIAL IoT CAD

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

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