VECTION TECHNOLOGIES LTD — Capital/Financing Update 2024

Aug 28, 2024

Appendix 3B - Proposed issue of securities

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Announcement Summary

Entity name

VECTION TECHNOLOGIES LTD

Announcement Type

New announcement

Date of this announcement

29/8/2024

The Proposed issue is:

A placement or other type of issue

Total number of +securities proposed to be issued for a placement or other type of issue

		Maximum Number of
ASX +security code	+Security description	+securities to be issued
New class-code to be	Listed options ex$0.018 expiring 3 years from the date of	70,000,000
confirmed	issue
New class-code to be	Listed options ex$0.018 expiring 3 years from the date of	200,000,000
confirmed	issue
VR1AA	PERFORMANCE RIGHTS	34
VR1	ORDINARY FULLY PAID	357,014,000

Proposed +issue date 6/9/2024

Refer to next page for full details of the announcement

Appendix 3B - Proposed issue of securities

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Appendix 3B - Proposed issue of securities

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Part 1 - Entity and announcement details

1.1 Name of +Entity

VECTION TECHNOLOGIES LTD

We (the entity named above) give ASX the following information about a proposed issue of +securities and, if ASX agrees to +quote any of the +securities (including any rights) on a +deferred settlement basis, we agree to the matters set out in Appendix 3B of the ASX Listing Rules.

If the +securities are being offered under a +disclosure document or +PDS and are intended to be quoted on ASX, we also apply for quotation of all of the +securities that may be issued under the +disclosure document or +PDS on the terms set out in Appendix 2A of the ASX Listing Rules (on the understanding that once the final number of +securities issued under the +disclosure document or +PDS is known, in accordance with Listing Rule 3.10.3C, we will complete and lodge with ASX an Appendix 2A online form notifying ASX of their issue and applying for their quotation).

1.2 Registered Number Type

ABN

Registration Number

93614814041

1.3 ASX issuer code

VR1

1.4 The announcement is

New announcement

1.5 Date of this announcement

29/8/2024

1.6 The Proposed issue is:

A placement or other type of issue

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Appendix 3B - Proposed issue of securities

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Part 7 - Details of proposed placement or other issue

Part 7A - Conditions

7A.1 Do any external approvals need to be obtained or other conditions satisfied before the placement or other type of issue can proceed on an unconditional basis? Yes 7A.1a Conditions

Approval/Condition Date for determination +Security holder approval 7/10/2024

Is the date estimated or ** Approval actual? received/condition met? Estimated

Comments

Issue of securities for the acquisition of The Digital Box S.p.A. (TDB) are subject to approval by shareholders. Extraordinary General Meeting expected to be held in early October.

Part 7B - Issue details

Is the proposed security a 'New class' (+securities in a class that is not yet quoted or recorded by ASX) or an 'Existing class' (additional securities in a class that is already quoted or recorded by ASX)? Existing class

Will the proposed issue of this +security include an offer of attaching +securities? No

Details of +securities proposed to be issued

ASX +security code and description

VR1 : ORDINARY FULLY PAID

Number of +securities proposed to be issued

157,014,000

Offer price details

Are the +securities proposed to be issued being issued for a cash consideration? No

Please describe the consideration being provided for the +securities

Ownership of Generative AI company TDB.

Please provide an estimate of the AUD equivalent of the consideration being provided for the +securities 1,570,140.000000

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Appendix 3B - Proposed issue of securities

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Will these +securities rank equally in all respects from their issue date with the existing issued +securities in that class? Yes

Is the proposed security a 'New Will the proposed issue of this class' (+securities in a class that is +security include an offer of not yet quoted or recorded by ASX) attaching +securities? or an 'Existing class' (additional No securities in a class that is already quoted or recorded by ASX)? Existing class

Details of +securities proposed to be issued

ASX +security code and description VR1AA : PERFORMANCE RIGHTS Number of +securities proposed to be issued 17 Offer price details Are the +securities proposed to be issued being issued for a cash consideration? No Please describe the consideration being provided for the +securities Ownership of Generative AI company TDB. Class A performance rights that will convert into an aggregate of up to 23,571,429 Shares subject to TDB achieving financial milestones. Additional 10% issue to advisor. Please provide an estimate of the AUD equivalent of the consideration being provided for the +securities 235,714.000000 Will these +securities rank equally in all respects from their issue date with the existing issued +securities in that class? Yes Is the proposed security a 'New Will the proposed issue of this class' (+securities in a class that is +security include an offer of not yet quoted or recorded by ASX) attaching +securities? or an 'Existing class' (additional No securities in a class that is already quoted or recorded by ASX)? Existing class

Details of +securities proposed to be issued

ASX +security code and description VR1AA : PERFORMANCE RIGHTS

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Appendix 3B - Proposed issue of securities

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Number of +securities proposed to be	issued
17
Offer price details
Are the +securities proposed to be issued being issued for a cash
consideration?
No
Please describe the consideration being provided for the +securities Ownership of Generative AI company TDB. Class B performance rights that will convert into an aggregate of up to 26,258,571 Shares subject to TDB achieving financial milestones. Additional 10% issue to advisor.
Please provide an estimate of the AUD equivalent of the consideration being provided for the +securities
262,586.000000
Will these +securities rank equally in all respects from their issue date with
the existing issued +securities in that class?
Yes
Is the proposed security a 'New	Will the proposed issue of this
class' (+securities in a class that is	+security include an offer of
not yet quoted or recorded by ASX)	attaching +securities?
or an 'Existing class' (additional	No
securities in a class that is already
quoted or recorded by ASX)?
New class
Details of +securities proposed to be issued
ISIN Code (if Issuer is a foreign company and +securities do not have +CDIs
issued over them)
Have you received confirmation from	Will the entity be seeking quotation
ASX that the terms of the proposed	of the 'new' class of +securities on
+securities are appropriate and	ASX?
equitable under listing rule 6.1?	Yes
No
ASX +security code New class-code to be confirmed	+Security description Listed options ex$0.018 expiring 3 years from the date of issue
+Security type
Options
Number of +securities proposed to be	issued
70,000,000
Offer price details
Are the +securities proposed to be issued being issued for a cash consideration?
No

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Appendix 3B - Proposed issue of securities

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Please describe the consideration being provided for the +securities

Lead manager services Please provide an estimate of the AUD equivalent of the consideration being provided for the +securities 362,280.000000 Will all the +securities issued in this class rank equally in all respects from their issue date? Yes Options details +Security currency Exercise price Expiry date AUD - Australian Dollar AUD 0.0180 7/10/2027 Details of the type of +security that will be issued if the option is exercised VR1 : ORDINARY FULLY PAID

Number of securities that will be issued if the option is exercised

One fully paid ordinary share (ASX:VR1) Please provide a URL link for a document lodged with ASX setting out the material terms of the +securities proposed to be issued or provide the information by separate announcement. Refer announcement dated 29 August 2024.

Is the proposed security a 'New Will the proposed issue of this class' (+securities in a class that is +security include an offer of not yet quoted or recorded by ASX) attaching +securities? or an 'Existing class' (additional Yes securities in a class that is already quoted or recorded by ASX)? Existing class

Details of +securities proposed to be issued

ASX +security code and description VR1 : ORDINARY FULLY PAID

Number of +securities proposed to be issued

200,000,000

Offer price details

Are the +securities proposed to be issued being issued for a cash consideration? Yes

In what currency is the cash What is the issue price per consideration being paid? +security? AUD - Australian Dollar AUD 0.01000

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Appendix 3B - Proposed issue of securities

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Will these +securities rank equally in all respects from their issue date with the existing issued +securities in that class? Yes

Attaching +Security

Is the proposed attaching security a 'New class' (+securities in a class that is not yet quoted or recorded by ASX) or an 'Existing class' (additional +securities in a class that is already quoted or recorded by ASX)? New class

Attaching +Security - New class (+securities in a class that is not yet quoted or recorded by ASX)

Details of attaching +securities proposed to be issued

ISIN Code (if Issuer is a foreign company and +securities do not have +CDIs issued over them)

Have you received confirmation from ASX that the terms Will the entity be seeking quotation of the 'new' class of of the proposed +securities are appropriate and +securities on ASX? equitable under listing rule 6.1? Yes No

ASX +security code +Security description New class-code to be confirmed Listed options ex$0.018 expiring 3 years from the date of issue

+Security type

Options Number of +securities proposed to be issued 200,000,000 Offer price details

Are the +securities proposed to be issued being issued for a cash consideration? No

Please describe the consideration being provided for the +securities

Free attaching options for participants in placement.

Please provide an estimate of the AUD equivalent of the consideration being provided for the +securities 1,035,086.000000

Will all the +securities issued in this class rank equally in all respects from their issue date? Yes

Options details

+Security currency

AUD - Australian Dollar

Exercise price AUD 0.0180

Expiry date 7/10/2027

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Appendix 3B - Proposed issue of securities

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Details of the type of +security that will be issued if the option is exercised VR1 : ORDINARY FULLY PAID Number of securities that will be issued if the option is exercised One fully paid ordinary share (ASX:VR1) Please provide a URL link for a document lodged with ASX setting out the material terms of the +securities proposed to be issued or provide the information by separate announcement. Refer announcement dated 29 August 2024.

Part 7C - Timetable

7C.1 Proposed +issue date 6/9/2024 Part 7D - Listing Rule requirements 7D.1 Has the entity obtained, or is it obtaining, +security holder approval for the entire issue under listing rule 7.1? No 7D.1b Are any of the +securities proposed to be issued without +security holder approval using the entity's 15% placement capacity under listing rule 7.1? Yes 7D.1b ( i ) How many +securities are proposed to be issued without security holder approval using the entity's 15% placement capacity under listing rule 7.1? 88000000 7D.1c Are any of the +securities proposed to be issued without +security holder approval using the entity's additional 10% placement capacity under listing rule 7.1A (if applicable)? Yes 7D.1c ( i ) How many +securities are proposed to be issued without +security holder approval using the entity's additional 10% placement capacity under listing rule 7.1A? 112000000 7D.1c ( ii ) Please explain why the entity has chosen to do a placement rather than a +pro rata issue or an offer under a +security purchase plan in which existing ordinary +security holders would have been eligible to participate Shorter timeframe to receive funds and to add new shareholders to the register. 7D.2 Is a party referred to in listing rule 10.11 participating in the proposed issue? No 7D.3 Will any of the +securities to be issued be +restricted securities for the purposes of the listing rules? No 7D.4 Will any of the +securities to be issued be subject to +voluntary escrow? Yes 7D.4a Please enter the number and +class of the +securities subject to +voluntary escrow and the date from which they will cease to be subject to +voluntary escrow 153,414,000 Shares - subject to 12 month voluntary escrow from date of issue.

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Appendix 3B - Proposed issue of securities

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Part 7E - Fees and expenses

7E.1 Will there be a lead manager or broker to the proposed issue? Yes

7E.1a Who is the lead manager/broker?

Evolution Capital

7E.1b What fee, commission or other consideration is payable to them for acting as lead manager/broker?

Management fee of 2.0% and selling fee of 4.0% of the Placement amount.

70 million broker options on the same terms as the free attaching options to the Placement (intended to be listed).

7E.2 Is the proposed issue to be underwritten? No

7E.4 Details of any other material fees or costs to be incurred by the entity in connection with the proposed issue

Part 7F - Further Information

7F.01 The purpose(s) for which the entity is issuing the securities

For working capital to support and integrate a new acquisition with AI capabilities.

7F.1 Will the entity be changing its dividend/distribution policy if the proposed issue proceeds? No

7F.2 Any other information the entity wishes to provide about the proposed issue

Performance rights vest on achievement of financial milestones as outlined in the 29 August 2024 announcement.

7F.3 Any on-sale of the +securities proposed to be issued within 12 months of their date of issue will comply with the secondary sale provisions in sections 707(3) and 1012C(6) of the Corporations Act by virtue of: The publication of a +disclosure document or +PDS for the +securities proposed to be issued

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