Arq : Scheme Booklet - Replacement Copy

24 August 2020

WEBCENTRAL GROUP LIMITED (ASX: WCG)

SCHEME BOOKLET - REPLACEMENT COPY

The scheme booklet published by Webcentral Group Limited (Webcentral) on the ASX on 21 August 2020 in relation to the proposed acquisition of Webcentral by a wholly owned subsidiary of Web.com Group, Inc. by way of scheme of arrangement, appears to have been corrupted during electronic submission to the ASX and had some missing text.

A replacement copy of the scheme booklet is attached to this announcement.

ENDS.

The release of this announcement to the ASX was authorised by Webcentral's Board of Directors.

About Webcentral Group Ltd

Webcentral Group Ltd is Australia's largest full-service digital services partner for small and medium businesses - fuelling the growth of local businesses from inception to acceleration.

Since its founding in 1996, Webcentral Group Ltd (previously Melbourne IT Group and Arq Group) has helped fuel the digital success of more than one million Australian small to medium businesses. With roots in domain name and hosting, Webcentral Group Ltd are the small and medium business digital growth solution experts helping businesses get online, improve their online performance, and protect their online presence.

Webcentral Group Ltd consists of the brands Netregistry, WME, Melbourne IT, and Domainz. The Webcentral Group Ltd Enterprise division was divested March 2020.

P: 02 9215 6300	P: 02 9215 6300	P: 02 9215 6300
Level 23, 680 George St,	Level 9, 505 Little Collins St,	Level 3, 192 Ann Street
Sydney NSW 2000	Melbourne VIC 3000	Brisbane QLD 4000
Webcentral group ABN 21 073 716 793	ACN 073 716 793
webcentralgroup.com.au

THIS IS AN IMPORTANT DOCUMENT AND REQUIRES YOUR IMMEDIATE ATTENTION. YOU SHOULD READ IT ENTIRELY BEFORE DECIDING WHETHER OR NOT TO VOTE IN FAVOUR OF THE SCHEME OF ARRANGEMENT. IF YOU ARE IN ANY DOUBT ABOUT HOW TO DEAL WITH THIS DOCUMENT, YOU SHOULD CONTACT YOUR BROKER OR FINANCIAL, TAXATION, LEGAL OR OTHER PROFESSIONAL ADVISER IMMEDIATELY.

VOTE IN FAVOUR

Scheme Booklet

This Scheme Booklet relates to a scheme of arrangement between Webcentral Group Limited (ACN 073 716 793) and its shareholders which, if implemented, will result in Web.com Aus Bidco Pty Ltd (ACN 635 836 298) acquiring all of the Webcentral Shares.

Your Webcentral Directors unanimously recommend that you vote in favour of the Scheme, in the absence of a Superior Proposal and subject to the Independent Expert continuing to conclude that the Scheme is in the best interests of Webcentral Shareholders.

The Independent Expert has concluded that the Scheme is fair and reasonable and, therefore, is in the best interests of Webcentral Shareholders, in the absence of a superior proposal.

FINANCIAL ADVISER	LEGAL ADVISER

IMPORTANT NOTICES

General

This Scheme Booklet is important and requires your immediate attention. You should read this Scheme Booklet in full before making any decision as to how to vote at the Scheme Meeting.

Nature of this Scheme Booklet

This Scheme Booklet includes the explanatory statement for the Scheme required by subsection 412(1) of the Corporations Act. The Notice of Scheme Meeting is set out in Annexure 4.

This Scheme Booklet does not constitute or contain an offer to Webcentral Shareholders, or a solicitation of an offer from Webcentral Shareholders, in any jurisdiction. This Scheme Booklet is not a disclosure document required by Chapter 6D of the Corporations Act. Subsection 708(17) of the Corporations Act provides that Chapter 6D of the Corporations Act does not apply in relation to arrangements under Part 5.1 of the Corporations Act approved at a meeting held as a result of an order under subsection 411(1). Instead, Webcentral Shareholders asked to vote on an arrangement at such a meeting must be provided with an explanatory statement as referred to above.

ASIC and ASX

A copy of this Scheme Booklet has been registered by ASIC for the purposes of subsection 412(6) of the Corporations Act. ASIC has been given the opportunity to comment on this Scheme Booklet in accordance with subsection 411(2) of the Corporations Act. Neither ASIC, nor any of its officers, takes any responsibility for the contents of this Scheme Booklet. ASIC has been requested to provide a statement, in accordance with paragraph 411(17)(b) of the Corporations Act, that it has no objection to the Scheme. If ASIC provides that statement, it will be produced to the Court at the time of the Court hearings to approve the Scheme. A copy of this Scheme Booklet has been provided to the ASX. Neither the ASX, nor any of its officers, takes any responsibility for the contents of this Scheme Booklet.

Important notice associated with Court order under subsection 411(1) of the Corporations Act

The fact that, under subsection 411(1) of the Corporations Act, the Court has ordered that a meeting be convened and has approved the explanatory statement required to accompany the Notice of Scheme Meeting does not mean that the Court:

• has formed any view as to the merits of the proposed Scheme or as to how Webcentral Shareholders should vote (on this matter Webcentral Shareholders must reach their own conclusion); or
• has prepared, or is responsible for the content of, the explanatory statement.

Notice of Second Court Hearing

At the Second Court Hearing, the Court will consider whether to approve the Scheme following the vote at the Scheme Meeting. Any Webcentral Shareholder may appear, by way of teleconference, at the Second Court Hearing, currently expected to be held at 9.15am (Sydney time) on 1 October 2020 at the Law Courts Building, 184 Phillip Street, Sydney, New South Wales 2000, Australia. Any Webcentral Shareholder who wishes to oppose approval of the Scheme at the Second Court Hearing may do so by filing with the Court and serving on Webcentral a notice of appearance in the prescribed form together with any affidavit that the Webcentral Shareholder proposes to rely on. Dial-in details for the Second Court Hearing will be made available to any Webcentral Shareholder who indicates an intention to appear in this manner.

Defined terms

Capitalised terms used in this Scheme Booklet are defined in section 10 of this Scheme Booklet, which section 10 of this Scheme Booklet also sets out some rules of interpretation which apply to this Scheme Booklet. Some of the documents reproduced in the annexures to this Scheme Booklet have their own defined terms, which are sometimes different to those set out in section 10.

No investment advice

This Scheme Booklet has been prepared without reference to the investment objectives, financial and taxation situation or particular needs of any Webcentral Shareholder or any other person. The information and recommendations contained in this Scheme Booklet do not constitute, and should not be taken as, financial product advice. The Webcentral Directors encourage you to seek independent financial and taxation advice, and to read this Scheme Booklet in its entirety, before making any investment decision and any decision as to whether or not to vote in favour of the Scheme. In particular, it is important that you consider the potential risks if the Scheme does not proceed, as set out in section 7 of this Scheme Booklet, and the views of the Independent Expert set out in the Independent Expert's Report contained in Annexure 1. If you are in doubt as to the course you should follow, you should consult an independent and appropriately licensed and authorised professional adviser immediately.

Forward looking statements

Some of the statements appearing in this Scheme Booklet (including in the Independent Expert's Report) may be in the nature of forward looking statements. Forward looking statements or statements of intent in relation to future events in this Scheme Booklet (including in the Independent Expert's Report) should not be taken to be forecasts or predictions that those events will occur. Forward looking statements generally may be identified by the use of forward looking words such as 'believe', 'aim', 'expect', 'anticipate', 'intending', 'foreseeing', 'likely', 'should', 'planned', 'may', 'estimate', 'potential', or other similar words. Similarly, statements that describe the objectives, plans, goals, intentions or expectations of Webcentral, Web.com or any of their respective Subsidiaries are or may be forward looking statements. You should be aware that such statements are only opinions and are subject to inherent risks and uncertainties. Those risks and uncertainties include factors and risks specific to Webcentral, Web.com or any of their respective Subsidiaries and/or the industries in which they each operate, as well as general economic conditions, prevailing exchange rates and interest rates and conditions in financial markets.

Actual events or results may differ materially from the events or results expressed or implied in any forward looking statement and deviations are both normal and to be expected. None of Webcentral, Web.com or any of their respective Subsidiaries, or any officers, directors, employees or advisers of any of them or any person named in this Scheme Booklet or any person involved in the preparation of this Scheme Booklet makes any representation or warranty (either express or implied) as to the accuracy or likelihood of fulfilment of any forward looking statement, or any events or results expressed or implied in any forward looking statement. Accordingly, you are cautioned not to place undue reliance on those statements.

Any forward looking statements in this Scheme Booklet reflect views held only at the date of this Scheme Booklet. Subject to any continuing obligations under the Listing Rules or the Corporations Act, Webcentral, Web.com and each of their respective Subsidiaries and the officers, directors, employees

2 Webcentral Group Limited | Scheme Booklet

and advisers of each of them disclaim any obligation or undertaking to distribute after the date of this Scheme Booklet any updates or revisions to any forward looking statements to reflect (a) any change in expectations in relation to such statements; or (b) any change in events, conditions or circumstances on which any such statement is based.

Responsibility statement

Webcentral has prepared, and is responsible for, the Webcentral Information. Neither Web.com nor any of its Subsidiaries, nor any director, officer, employee or adviser of any of them assumes any responsibility for the accuracy or completeness of such information.

Web.com has prepared, and is responsible for, the Web.com Information. Neither Webcentral nor any of its Subsidiaries, nor any director, officer, employee or adviser of any of them assumes any responsibility for the accuracy or completeness of such information.

Greenwoods & Herbert Smith Freehills has prepared the Tax Adviser's Letter in relation to the Scheme and takes responsibility for that report. Neither Webcentral nor Web.com nor any of their respective Subsidiaries, nor any director, officer, employee or adviser of any of them assumes any responsibility for the accuracy or completeness of the information contained in the Tax Adviser's Letter. The Tax Adviser's Letter is set out in section 8 of this Scheme Booklet.

BDO Corporate Finance (WA) Pty Ltd has prepared the Independent Expert's Report (as set out in Annexure 1) and takes responsibility for that report. Neither Webcentral nor Web.com nor any of their respective Subsidiaries, nor any director, officer, employee or adviser of any of them assumes any responsibility for the accuracy or completeness of the information contained in the Independent Expert's Report, except, in the case of Webcentral, in relation to the information which it has provided to the Independent Expert.

No consenting party has withdrawn their consent to be named before the date of this Scheme Booklet.

Foreign jurisdictions

The release, publication or distribution of this Scheme Booklet in jurisdictions other than Australia may be restricted by law or regulation in such other jurisdictions and persons outside of Australia who come into possession of this Scheme Booklet should seek advice on and observe any such restrictions. Any failure to comply with such restrictions may constitute a violation of applicable laws or regulations.

This Scheme Booklet has been prepared in accordance with the laws of Australia and the information contained in this Scheme Booklet may not be the same as that which would have been disclosed if this Scheme Booklet had been prepared in accordance with the laws and regulations of a jurisdiction outside of Australia.

Webcentral Shareholders who are nominees, trustees or custodians are encouraged to seek independent advice as to how they should proceed.

Tax implications of the Scheme

If the Scheme becomes Effective, there will be tax consequences for Scheme Shareholders. For further detail regarding general Australian tax consequences of the Scheme, refer to the Tax Adviser's Letter contained in section 8 of this Scheme Booklet. The tax treatment may vary depending on the nature and characteristics of each Webcentral Shareholder and their specific circumstances. Accordingly, Webcentral Shareholders should seek independent professional tax advice in relation to their particular circumstances.

Financial amounts and effects of rounding

Financial amounts in this Scheme Booklet are expressed in Australian currency unless otherwise stated. A number of figures, amounts, percentages, estimates, calculations and fractions in this Scheme Booklet are subject to the effect of rounding. Accordingly, any discrepancies between totals in tables or financial statements, or in calculations, graphs or charts are due to rounding. All financial and operational information set out in this Scheme Booklet is current as at the date of this Scheme Booklet, unless otherwise stated.

Charts and diagrams

Any diagrams, charts, graphs or tables appearing in this Scheme Booklet are illustrative only and may not be drawn to scale. Unless stated otherwise, data contained in diagrams, charts, graphs and tables is based on information available as at the Last Practicable Date.

Timetable and dates

All times and dates referred to in this Scheme Booklet are times and dates in Sydney, New South Wales, Australia, unless otherwise indicated. All times and dates relating to the implementation of the Scheme referred to in this Scheme Booklet may change.

External websites

Unless expressly stated otherwise, the content of the websites of Webcentral and Web.com do not form part of this Scheme Booklet and Webcentral Shareholders should not rely on any such content.

Privacy

Webcentral may collect personal information in the process of implementing the Scheme. The type of information that it may collect about you includes your name, contact details and information on your shareholding in Webcentral and the names of persons appointed by you to act as a proxy, attorney or corporate representative at the Scheme Meeting as relevant to you. The collection of some of this information is required or authorised by the Corporations Act. The primary purpose of the collection of personal information is to assist Webcentral to conduct the Scheme Meeting and implement the Scheme. Without this information, Webcentral may be hindered in its ability to issue this Scheme Booklet and implement the Scheme. Personal information of the type described above may be disclosed to the Webcentral Share Registry, third party service providers (including print and mail service providers and parties otherwise involved in the conduct of the Scheme Meeting), authorised securities brokers, professional advisers, Related Bodies Corporate of Webcentral, Government Agencies, and also where disclosure is otherwise required or allowed by law. Webcentral Shareholders who are individuals and the other individuals in respect of whom personal information is collected as outlined above have certain rights to access the personal information collected in relation to them. If you would like to obtain details of the information about you held by the Webcentral Share Registry in connection with Webcentral Shares, please contact the Webcentral Share Registry. Webcentral Shareholders who appoint an individual as their proxy, corporate representative or attorney to vote at the Scheme Meeting should ensure that they inform such an individual of the matters outlined above. Further information about how Webcentral collects, uses and discloses personal information is contained in Webcentral's Privacy Policy located at www.webcentralgroup.com.au/privacy-policy/.

Date of this Scheme Booklet

This Scheme Booklet is dated 21 August 2020.

Webcentral Group Limited | Scheme Booklet

3

CONTENTS

Letter from the Chair of the Webcentral Board	5
Key dates	9
1	Key considerations relevant to your vote	10
2	Frequently asked questions	15
3	How to vote	24
4	Overview of the Scheme	26
5	Information about Webcentral and the Webcentral Group	31
6	Information about Web.com and the Web.com Group	45
7	Risk factors	52
8	Tax Adviser's Letter	58
9	Additional information	61
10	Definitions and interpretation	73
Annexure 1	87
Independent Expert's Report
Annexure 2	154
Scheme of arrangement
Annexure 3	170
Deed Poll
Annexure 4	181
Notice of Scheme Meeting

4 Webcentral Group Limited | Scheme Booklet

LETTER FROM THE CHAIR OF THE WEBCENTRAL BOARD

21 August 2020

Dear Webcentral Shareholder,

On behalf of the Webcentral Board, I am pleased to provide you with this Scheme Booklet which contains information in relation to the proposed acquisition of Webcentral Group Limited by Web.com Aus Bidco Pty Ltd (an indirectly wholly owned subsidiary of Web.com Group, Inc. (Web.com)) by way of a scheme of arrangement.

If the Scheme is approved and implemented, Webcentral Shareholders who are registered as such on the Scheme Record Date will receive $0.10 in cash per Webcentral Share held (Scheme Consideration).

The Scheme Consideration represents a:

• 56% premium to the closing price on 10 July 2020 (being the last trading day prior to the Announcement Date) of $0.064 per Webcentral Share; and
• 20.5% premium to the30-day VWAP to 10 July 2020 of $0.083 per Webcentral Share.

The Scheme Consideration implies:

• an equity value for Webcentral of approximately $12.2 million;1and
• an enterprise value (EV) for Webcentral of approximately $57.8 million.2

Importantly, upon implementation of the Scheme, Web.com will also ensure the full and final repayment by Webcentral of its Existing Debt Facilities under which there is anticipated to be approximately $45.6 million repayable on the Implementation Date.3Accordingly, the aggregate amount payable by Web.com to acquire all of the Webcentral Shares and repay the Existing Debt Facilities is anticipated to be approximately $57.8 million.

If the Scheme does not become Effective, there is no assurance that the Existing Financiers will continue to provide the support that Webcentral requires to continue as a going concern.4In addition, it is expected to be challenging for Webcentral to find an alternative refinancing solution on terms that are commercially reasonable or at all, particularly in light of the challenges that have arisen as a result of the COVID-19 pandemic, its decreasing cash receipts, committed costs, high Net Leverage Ratio and failure to satisfy its financial covenants in four consecutive reporting periods. In such circumstances, there is a real risk that Webcentral may have insufficient liquidity to meet its debts as and when they fall due, which may require the Webcentral Directors to consider the appointment of a voluntary administrator on the basis that Webcentral may be insolvent or likely to become insolvent in the near future.

It is important to note that even prior to implementation of the Scheme, Webcentral expects to require additional short-term funding and the ongoing support of the Existing Financiers to continue to provide the Existing Debt Facilities and any required additional funding to be able to continue as a going concern. In the event the Scheme is not approved by Webcentral Shareholders and is not implemented, it is likely that Webcentral will have insufficient available liquidity to meet the amount due to the Existing Financiers on 30 November 2020.5

Webcentral Directors' recommendation

Your Webcentral Board has carefully considered the proposal from Web.com and unanimously recommends that Webcentral Shareholders vote in favour of the Scheme, in the absence of a Superior Proposal and subject to the Independent Expert continuing to conclude that the Scheme is in the best interests of Webcentral Shareholders.

1. Based on there being 122,131,124 Webcentral Shares on issue.
2. EV calculated based on equity value implied by the Scheme Consideration plus anticipated net debt (excluding bank guarantees, merchant facility, a direct debit facility and credit card debt) of approximately $45.6 million on the Implementation Date. This differs from the enterprise value as calculated by the Independent Expert for the purposes of the Independent Expert's Report, which is instead based on an independent assessment of (i) potential future maintainable earnings of the Webcentral Group and (ii) the appropriate range of EBITDA multiples to apply to such future earnings. As noted in the
   Independent Expert's Report, there is inherent uncertainty involved in estimating such future cashflows. See the Independent Expert's Report which is contained in Annexure 1 for further details.
3. Excluding bank guarantees, a merchant facility, a direct debit facility and credit card debt. See section 5.4 of this Scheme Booklet for further information on Webcentral's Existing Debt Facilities.
4. The Existing Financiers have provided support to Webcentral throughout its strategic review process (see section 5.3). However, as a result of the 31 January Review Event that is subsisting, the Existing Financiers retain the right to cancel, and demand repayment of, the Existing Debt Facilities upon providing Webcentral with 60 days' written notice.
5. An amount of $2.5 million matures and is repayable on 30 November 2020. Further information on the Existing Debt Facilities is set out in section 5.4 of this Scheme Booklet.

Webcentral Group Limited | Scheme Booklet

5

LETTER FROM THE CHAIR OF THE WEBCENTRAL BOARD CONT.

Subject to those same qualifications, the Webcentral Directors, who collectively have a Relevant Interest in approximately 19% of the Webcentral Shares, intend to vote or procure the vote of all of those Webcentral Shares in favour of the Scheme.6

Independent Expert's opinion

Your Webcentral Board appointed BDO Corporate Finance (WA) Pty Ltd as the Independent Expert to assess the merits of the Scheme.

The Independent Expert has:

• concluded that the Scheme is fair and reasonable and, therefore, is in the best interests of Webcentral Shareholders, in the absence of a superior proposal; and
• assessed the full underlying value of Webcentral at between $0.083 and $0.126 per Webcentral Share. The Scheme Consideration is within this range.

A copy of the Independent Expert's Report is included in Annexure 1 to this Scheme Booklet. You are encouraged to read the Independent Expert's Report before making any voting or investment decision in relation to your Webcentral Shares.

Summary of the reasons for the Webcentral Directors' recommendation

In summary, the key reasons for the Webcentral Directors' recommendation include:

• Independent Expert's conclusion:the Independent Expert has concluded that the Scheme is fair and reasonable and, therefore, is in the best interests of Webcentral Shareholders in the absence of a superior proposal;
• certainty of value:the 100% cash consideration provides Webcentral Shareholders with the opportunity to realise certain cash value for their Webcentral Shares at an attractive premium to recent trading;
• attractive premium to recent trading:as noted above, the Scheme Consideration represents a 56% premium to the closing share price on 10 July 2020 and a 20.5% premium to the 30-day VWAP to 10 July 2020;
• limited conditionality:the Scheme is subject to limited conditions, including shareholder, Court and FIRB approval.
  The Scheme is not subject to financing or completion of due diligence and Web.com has received confirmation from the ACCC that it will not oppose the Scheme. The condition relating to the Customer Dispute has also been satisfied following the settlement of the Customer Dispute on terms and conditions acceptable to Web.com;7
• superior outcome following broad reaching strategic review:in September 2019, your Webcentral Board announced that it had appointed Macquarie Capital to undertake a strategic review, exploring all avenues for maximising shareholder value. The strategic review was prompted by markedly softened trading conditions and downgraded forecasts for the Webcentral Group's underlying EBITDA announced in June 2019 and September 2019 - in the latter case, by approximately 37% below the guidance issued in August 2019.8Webcentral received interest from a wide variety of strategic and financial buyers, and granted access to management and due diligence materials to multiple bidders. The completion of the first phase of the strategic review resulted in the divestment of Webcentral's Enterprise division in March 2020. The Scheme represents the completion of the strategic review. Your Webcentral Board has determined that Web.com's offer emerged from the strategic review as the superior offer for Webcentral Shareholders, balancing the maximisation of shareholder value with transaction certainty;
• you will not be exposed to risks associated with Webcentral's business:the Scheme provides certainty against the risks associated with the execution of Webcentral's long term strategy, as well as the risk that, absent the Scheme, no alternative refinancing solution is available on terms that are commercially reasonable and the Existing Financiers cease to provide the support that Webcentral requires to continue as a going concern;9
• repayment of Existing Debt Facilities:upon implementation of the Scheme, Web.com will refinance Webcentral's Existing Debt Facilities and ensure the full and final payment or repayment by Webcentral to its Existing Financiers of all amounts payable to them under the Existing Debt Facilities;
• minimal opportunities absent the Scheme:in light of Webcentral's existing debt levels and ongoing costs (including those associated with remaining as a listed entity), it is expected to be difficult for Webcentral to raise additional funding from the Existing Financiers, or from third party debt providers, to support any substantial development or growth of its business or for strategic acquisitions. Under Webcentral's Existing Debt Facilities as at the date of this Scheme Booklet,

1. See section 9.1 of this Scheme Booklet for details of the Relevant Interests of the Webcentral Directors.
2. Further information on the Customer Dispute is set out in section 5.5 of this Scheme Booklet.
3. Mid-pointof disclosed guidance range. June 2019 underlying EBITDA guidance was restated in August 2019 following the adoption of AASB 16. No effective change to the guidance was made following the restatement.
4. Further information on the Existing Debt Facilities is set out in section 5.4 of this Scheme Booklet. As noted in section 5.4, the total amount drawn under the Existing Debt Facilities matures on or before 2 July 2021. Additionally, as at the date of this Scheme Booklet, the Existing Financiers have the right to cancel, and demand repayment of, the Existing Debt Facilities upon providing Webcentral with 60 days' written notice.

6 Webcentral Group Limited | Scheme Booklet

any such additional funding obtained through raising further debt would be largely prohibited in the absence of the prior written consent of the Existing Financiers. There can be no certainty that the Existing Financiers would be willing to provide Webcentral with additional funding, or that funding from other third party debt providers would be available on terms that are commercially reasonable, if the Scheme does not become Effective; and

• no Superior Proposal:no other party has approached Webcentral since the Scheme was announced with a Superior Proposal.

Further information to assist you in determining whether to vote in favour of or against the Scheme is set out in section 1 of this Scheme Booklet.

Reasons you might not vote in favour of the Scheme

This Scheme Booklet also sets out some of the reasons why you may not wish to vote in favour of the Scheme and the risks associated with the Scheme (see in particular sections 1.2 and 7.4 respectively). In summary, the reasons you may not wish to vote in favour of the Scheme include that:

• you may disagree with the Webcentral Directors' unanimous recommendation and the Independent Expert's conclusion and believe that the Scheme is not in your best interests;
• you may prefer to participate in the future financial performance of the Webcentral business;
• you may believe it is in your best interests to maintain your current investment and risk profile;
• you may consider that there is potential for a Superior Proposal to emerge; or
• the tax consequences of transferring your Webcentral Shares pursuant to the Scheme may not be attractive to you.

How to vote

Your vote is important and I encourage you to vote. It is important that you vote in favour of the Scheme if you wish the Scheme to proceed.

The Scheme requires Court approval as well as the approval of the Requisite Majorities of Webcentral Shareholders at a Scheme Meeting which is scheduled to be held at 9.00am (Sydney time) online and by teleconference on Tuesday,

29 September 2020. Approval by the Requisite Majorities at the Scheme Meeting requires more than 50% of Webcentral Shareholders present and voting, and at least 75% of votes cast, to be in favour of the Scheme.

If the Scheme is not approved at the Scheme Meeting by the Requisite Majorities of Webcentral Shareholders, the Scheme will not be implemented and you will not receive the Scheme Consideration.

Further information on how to vote is contained in the Notice of Scheme Meeting attached as Annexure 4.

Virtual Scheme Meeting

In response to Government restrictions and the potential health risks arising from the COVID-19 pandemic, the Scheme Meeting will be held virtually. There will be no physical meeting.

Webcentral Shareholders can participate in the Scheme Meeting online via www.agmlive.link/WCG20. The online platform will allow Webcentral Shareholders to view the Scheme Meeting, ask questions during the Scheme Meeting and vote during the Scheme Meeting. To participate and vote online, Webcentral Shareholders will need their Shareholder Reference Number (SRN) or Holder Identification Number (HIN) (which is shown on the front of their holding statement or proxy form) and their postcode (or their country code if outside Australia). Proxyholders will need their proxy code, which Link Market Services will provide via email (where requested) no later than 48 hours prior to the Meeting. Further information on the online platform can be found in the Online User Guide available in the Investor Centre section of the Webcentral website (www.webcentralgroup.com.au).

Even if you plan to attend the Scheme Meeting online, we encourage you to submit a directed proxy vote as early as possible by completing and returning the proxy form accompanying this Scheme Booklet or lodging your proxy form online at https://investorcentre.linkmarketservices.com.au/voting/wcg.

Webcentral Shareholders can lodge questions prior to the Scheme Meeting by:

• submitting questions via https://investorcentre.linkmarketservices.com.au/voting/wcg (enter your details, then select "Ask Question"); or
• completing and returning the question form accompanying this Scheme Booklet by facsimile, to [phone],

by no later than 5.00pm (Sydney time) on 22 September 2020.

Webcentral Shareholders may also attend the Scheme Meeting by dialling into the teleconference on 1800 572 288 (within Australia) or [phone] (outside Australia) and providing your unique PIN which is located on your proxy form or email relating to the Scheme Meeting if you have elected to receive shareholder communications electronically. Webcentral Shareholders attending by teleconference may also vote during the meeting.

Webcentral Group Limited | Scheme Booklet

7

LETTER FROM THE CHAIR OF THE WEBCENTRAL BOARD CONT.

Further information

This Scheme Booklet sets out important information regarding the Scheme, including the reasons for your Webcentral Directors' recommendation and the Independent Expert's Report.

Please read this Scheme Booklet carefully and in its entirety as it will assist you in making an informed decision as to how to vote. I would also encourage you to seek independent financial, legal, taxation or other professional advice before making any voting or investment decision in relation to your Webcentral Shares.

If you require any further information, please call the Webcentral Shareholder information line on 1300 853 816 (within Australia) or [phone] (outside Australia) between 8.30am and 7.30pm (Sydney time), Monday to Friday, excluding public holidays.

On behalf of your Webcentral Board, I would also like to take this opportunity to thank you for your continued support of Webcentral.

Yours sincerely,

Andrew Reitzer

Chair, Webcentral Group Limited

8 Webcentral Group Limited | Scheme Booklet

KEY DATES

EVENT	TIME AND DATE
First Court Date	21 August 2020
Date of this Scheme Booklet	21 August 2020
Latest time and date for receipt of proxy forms (including proxy forms lodged	9.00am on 27 September 2020
online) or powers of attorney by the Webcentral Share Registry for the
Scheme Meeting
Time and date for determining eligibility to vote at the Scheme Meeting	7.00pm on 27 September 2020
Scheme Meeting	9.00am on 29 September 2020
In light of the Coronavirus (COVID-19), the Scheme Meeting will be held virtually.
There will not be a physical meeting.
Further details relating to the Scheme Meeting are set out in the Notice of
Scheme Meeting set out at Annexure 4 to this Scheme Booklet.

If the Scheme is approved by Webcentral Shareholders at the Scheme Meeting:

Second Court Date	1 October 2020
Outcome of Second Court Hearing announced to the ASX	1 October 2020
Effective Date	1 October 2020
Last day of trading in Webcentral Shares on market (Webcentral Shares will be	1 October 2020
suspended from trading on the ASX from close of trading)
Scheme Record Date (for determining entitlements to Scheme Consideration)	7.00pm on 7 October 2020
Implementation Date (Scheme Consideration will be dispatched to Scheme	12 October 2020
Shareholders on the Implementation Date)

All times and dates in the above timetable are references to the time and date in Sydney, New South Wales, Australia and all such times and dates are subject to change. Webcentral may vary any or all of these dates and times and will provide reasonable notice of any such variation. Certain times and dates are conditional on the approval of the Scheme by Webcentral Shareholders and by the Court. Any changes will be announced by Webcentral to the ASX.

Webcentral Group Limited | Scheme Booklet

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1 KEY CONSIDERATIONS RELEVANT TO YOUR VOTE

1.1 Reasons why you might vote for the Scheme

1. Your Webcentral Directors' recommendation
   The Webcentral Directors unanimously recommend that Webcentral Shareholders vote in favour of the Scheme, in the absence of a Superior Proposal and subject to the Independent Expert continuing to conclude that the Scheme is in Webcentral Shareholders' best interests.
   Subject to those same qualifications, the Webcentral Directors, who collectively have a Relevant Interest in approximately 19% of the Webcentral Shares, intend to vote or procure the vote of all of those Webcentral Shares in favour of the Scheme.10
   In making this recommendation, the Webcentral Directors have considered the advantages and disadvantages of the Scheme, including the information contained in:
2. • Section 1.1 (Reasons why you might vote for the Scheme)
   • Section 1.2 (Reasons why you might vote against the Scheme)
   • Section 7 (Risk factors)
   • Annexure 1 (Independent Expert's Report)
3. The Independent Expert has concluded that the Scheme is fair and reasonable and, therefore, in your best interests
   Your Webcentral Board appointed BDO Corporate Finance (WA) Pty Ltd as the Independent Expert to assess the merits of the Scheme.
   The Independent Expert has:
4. • concluded that the Scheme is fair and reasonable and, therefore, is in the best interests of Webcentral Shareholders, in the absence of a superior proposal; and
   • assessed the full underlying value of Webcentral at between $0.083 and $0.126 per Webcentral Share. The Scheme Consideration is within this range.11
5. The Scheme provides the opportunity to receive certain cash value for your Webcentral Shares and you will not be exposed to risks associated with Webcentral's business
   The 100% cash consideration provides Webcentral Shareholders with certainty of value and the opportunity to realise their investment in Webcentral in full for the Scheme Consideration.
   In particular, the Scheme provides certainty against the risks associated with the execution of Webcentral's long term strategy, as well as the risk that, absent the Scheme, no alternative refinancing solution is available on terms that are commercially reasonable and the Existing Financiers cease to provide the support that Webcentral requires to continue as a going concern.12
   If the Scheme does not proceed:
6. • the amount which Webcentral Shareholders will be able to realise in terms of price and future dividends (if any) will necessarily be uncertain and subject to a number of risks;13
   • Webcentral Shares will remain listed on the ASX and continue to be subject to market volatility, including stock market movements and the impact of general economic conditions. In considering the future of Webcentral as anASX-listed entity, Webcentral Shareholders should have regard to the risks outlined in section 5.4 (Webcentral's Existing Debt Facilities) and section 7 (Risk factors) of this Scheme Booklet;
   • Webcentral Shareholders will also be exposed to other general and specific risks relating to the
     Webcentral business, including those outlined in section 7 of this Scheme Booklet. These include various risks associated with the ongoing COVID-19 outbreak and the unprecedented economic and social uncertainty that the outbreak has caused; and

1. See section 9.1 of this Scheme Booklet for details of the Relevant Interests of the Webcentral Directors.
2. A copy of the Independent Expert's Report is included in Annexure 1 to this Scheme Booklet.
3. Further information on the Existing Debt Facilities is set out in section 5.4 of this Scheme Booklet. As noted in section 5.4, the total amount drawn under the Existing Debt Facilities matures on or before 2 July 2021. Additionally, as at the date of this Scheme Booklet, the Existing Financiers have the right to cancel, and demand repayment of, the Existing Debt Facilities upon providing Webcentral with 60 days' written notice.
4. See section 5.4 of this Scheme Booklet for details of the restriction on Webcentral's ability to make distributions to Webcentral Shareholders under the Existing Debt Facilities.

10 Webcentral Group Limited | Scheme Booklet

• whether or not the Existing Financiers continue to provide the Existing Debt Facilities, Webcentral may require additional funding. Absent such additional funding, there is a real risk that Webcentral will have insufficient liquidity to meet its debts as and when they fall due, which may require the Webcentral
  Directors to consider the appointment of a voluntary administrator on the basis that Webcentral may be insolvent or likely to become insolvent in the near future.

The Scheme removes these risks and uncertainties for Webcentral Shareholders and allows Webcentral Shareholders to exit their investment in Webcentral at a price that the Webcentral Directors consider attractive.

1. Clear path to repayment of Webcentral's Existing Debt FacilitiesIn assessing the Scheme, it is important to note that:
2. • as at 31 July 2020, the total amount drawn under the Existing Debt Facilities was approximately $47.6 million; and
   • the total amount drawn under the Existing Debt Facilities matures on 2 July 2021.14

Additionally, as at 31 March 2020, Webcentral's Net Leverage Ratio was approximately 4.01x.15This represents a significantly higher figure than the financial covenants established under the Existing Debt Facilities and is above the figures reported by certain of Webcentral's ASX-listed peers in the IT services sector.

Upon implementation of the Scheme, Web.com will refinance Webcentral's entire Existing Debt Facilities by ensuring the full and final payment or repayment by Webcentral of all amounts payable to the Existing Financiers under the Existing Debt Facilities.

Webcentral requires the ongoing support of the Existing Financiers, and the Existing Debt Facilities, to continue as a going concern. The Existing Financiers have provided support to Webcentral throughout its strategic review process (see section 5.3). However, as a result of the 31 January Review Event that is subsisting, the Existing Financiers retain the right to cancel, and demand repayment of, the Existing Debt Facilities upon providing Webcentral with 60 days' written notice.

If the Scheme does not become Effective, there is no assurance that the Existing Financiers will remain supportive of Webcentral. In addition, it is expected to be challenging for Webcentral to find an alternative refinancing solution on terms that are commercially reasonable or at all, particularly in light of the challenges that have arisen as a result of the COVID-19 pandemic, given its high Net Leverage Ratio and failure to satisfy its financial covenants in four consecutive reporting periods. In such circumstances, there is a real risk that Webcentral may have insufficient liquidity to meet its debts as and when they fall due, which may require the Webcentral Directors to consider the appointment of a voluntary administrator on the basis that Webcentral may be insolvent or likely to become insolvent in the near future.

For further information on Webcentral's Existing Debt Facilities, see section 5.4.

1. No Superior Proposal has emerged
   Since the Scheme was announced up until the Last Practicable Date, no Superior Proposal has emerged.
   The proposal from Web.com emerged as the preferred bid following an extensive strategic review process conducted by Webcentral that commenced in September 2019 (described further in section 5.3).
   If Webcentral receives a Competing Proposal from a Third Party, there are certain steps that must be taken by Webcentral in respect of that proposal, including, in certain circumstances, providing Web.com with the opportunity to submit a Web.com Counterproposal within five Business Days.
   In this regard, Webcentral notes the recent share purchasing activity of Keybridge Capital Limited and Merchant Opportunities Fund. However, since the announcement of the Scheme and as at the date of this Scheme Booklet, neither of those parties has presented Webcentral with a Competing Proposal.
   Webcentral also notes that, since announcement of the Scheme, Webcentral received Competing Proposals from two companies in the digital services sector. The Webcentral Directors complied with their obligations under the Scheme Implementation Deed in respect of those Competing Proposals. The Webcentral Directors carefully considered both Competing Proposals, and concluded that neither of them, as presented, constituted a Superior Proposal. In this regard, the Webcentral Directors note that the first Competing Proposal, among

1. This excludes an amount of $2.5 million, which matures on 30 November 2020.
2. Based on net debt of $41.93 million and consolidated EBITDA for the 12 months ended 31 March 2020 of $10.45 million.

Webcentral Group Limited | Scheme Booklet

11

1 Key considerations relevant to your vote CONT.

other things, would not have resulted in the Existing Financiers being repaid in full (which the Existing Financiers have indicated to be a fundamental requirement), did not have committed debt or equity funding lined up and was conditional on due diligence. In relation to the second Competing Proposal, the Webcentral Directors note it was only an informal approach and proposed the part repayment of the amounts outstanding under the Existing Debt Facilities and the maturity date of the balance being extended (which the Existing Financiers had previously indicated they would not accept and, accordingly, the proponent of this Competing Proposal would need to get the Existing Financiers to agree to such an arrangement).

Webcentral will make an ASX announcement if a Superior Proposal is received before the Scheme Meeting.

1. The Scheme Consideration represents an attractive premium to the trading price of Webcentral SharesThe Scheme Consideration represents a:
2. • 56% premium to the closing price of Webcentral Shares of $0.064 on 10 July 2020 (being the last trading day prior to the Announcement Date); and
   • 20.5% premium to the30-day VWAP to 10 July 2020 of $0.083 per Webcentral Share.

The Scheme Consideration also implies:

1. • an equity value for Webcentral of approximately $12.2 million;16and
   • an enterprise value (EV) for Webcentral of approximately $57.8 million.17Implying an EV/FY20 EBITDA18multiple of approximately 7.2x, based on Webcentral's FY20 EDITDA guidance pre-COVID-19, which was withdrawn on 15 April 2020.
2. The Scheme has limited conditionality
   The Scheme is subject to limited conditions, including shareholder, Court and FIRB approval. The Scheme is not subject to financing or completion of due diligence and Web.com has received confirmation from the
   ACCC that it will not oppose the Scheme. The condition relating to the Customer Dispute has also been satisfied following the settlement of the Customer Dispute on terms and conditions acceptable to Web.com.19

1. Based on there being 122,131,124 Webcentral Shares on issue.
2. EV calculated based on equity value implied by the Scheme Consideration plus anticipated net debt (excluding bank guarantees, merchant facility, a direct debit facility and credit card debt) of approximately $45.6 million on the Implementation Date. This differs from the enterprise value as calculated by the Independent Expert for the purposes of the Independent Expert's Report, which is instead based on an independent assessment of (i) potential future maintainable earnings of the Webcentral Group and (ii) the appropriate range of EBITDA multiples to apply to such future earnings. As noted in the
   Independent Expert's Report, there is inherent uncertainty involved in estimating such future cashflows. See the Independent Expert's Report which is contained in Annexure 1 for further details.
3. Based on FY20 EBITDA guidancepre-COVID-19 of approximately $8 million (comprising $11 million less corporate costs of $3 million). As noted in Webcentral's ASX announcement on 15 April 2020 that Webcentral was withdrawing its FY20 guidance, actual FY20 EBITDA may be lower as a result of the impact of COVID-19, which would result in a higher EV/FY20 EBITDA multiple.
4. Further information on the Customer Dispute is set out in section 5.5 of this Scheme Booklet.

12 Webcentral Group Limited | Scheme Booklet

1. If the Scheme does not proceed and no other proposal emerges, then the Webcentral Share price may fall below the amount of the Scheme Consideration
   If the Scheme does not proceed, and no other proposal emerges, then the Webcentral Share price may fall below the amount of the Scheme Consideration.
   Since market close on 10 July 2020 (being the last day on which Webcentral Shares traded before the Scheme was announced), Webcentral Shares have been trading at or above the amount per Webcentral
   Share of the Scheme Consideration, which is significantly above the closing price on 10 July 2020 of $0.064.
   This view is also supported by the Independent Expert, which states in the Independent Expert's Report:
   "Following the announcement of the Scheme, Webcentral's share price closed at $0.096, up from a close price of $0.064 on the date prior to the announcement of the Scheme. We note that following the announcement of the Scheme, the share price has traded at a price equal to the Scheme Consideration of $0.10 per share, suggesting that the market believes that the Scheme will proceed.
   Should the Scheme not be approved, there is a risk that the share price of Webcentral may fall back to pre-announcement levels."
   Additionally, in light of Webcentral's existing debt levels and ongoing costs (including those associated with remaining as a listed entity), it is expected to be difficult for Webcentral to raise additional funding from the
   Existing Financiers, or from third party debt providers, to support any substantial development or growth of its business or for strategic acquisitions. Under Webcentral's Existing Debt Facilities as at the date of this Scheme Booklet, any such additional funding obtained through raising further debt would be largely prohibited in the absence of the prior written consent of the Existing Financiers. There can be no certainty that the Existing Financiers would be willing to provide Webcentral with additional funding, or that funding from other third party debt providers would be available on terms that are commercially reasonable, if the Scheme does not become Effective.
2. No brokerage charges will apply to the transfer of your Webcentral Shares under the Scheme
   You will not incur any brokerage charges on the transfer of your Webcentral Shares to Web.com Sub under the Scheme.
   It is possible that such brokerage charges (and, potentially GST on those charges) would be incurred if you dispose of your Webcentral Shares other than under the Scheme.

1.2 Reasons why you might vote against the Scheme

There may be reasons which lead you to consider voting against the Scheme, including those set out below.

1. You may disagree with the Webcentral Directors' unanimous recommendation and the Independent Expert's conclusion and believe that the Scheme is not in your best interests
   In concluding that the Scheme is in the best interests of Webcentral Shareholders, in the absence of a superior proposal, the Independent Expert has made judgements based on future trading conditions and events which cannot be predicted with certainty and which may prove to be inaccurate (either positively or negatively).
   You may hold a different view from, and are not obliged to follow the unanimous recommendation of, the Webcentral Directors to vote in favour of the Scheme, and you may not agree with the Independent Expert's conclusions that the Scheme is in the best interests of Webcentral Shareholders.
2. You may prefer to participate in the future financial performance of the Webcentral business
   If the Scheme is implemented, you will no longer be a Webcentral Shareholder and will forgo any benefits that may result from being a Webcentral Shareholder.
   This will mean that you will not participate in the future performance of Webcentral or retain any exposure to Webcentral's business or assets or have the potential to share in the value that could be generated by Webcentral in the future. However, there is no guarantee as to Webcentral's future performance, as is the case with all investments.
3. You may believe it is in your best interests to maintain your current investment and risk profile
   You may prefer to keep your Webcentral Shares to preserve your investment in a listed company with the specific characteristics of Webcentral.
   In particular, you may consider that, despite the risk factors relevant to Webcentral's potential future operations (including those set out in section 5.4 and section 7 of this Scheme Booklet), Webcentral may be

Webcentral Group Limited | Scheme Booklet

13

1 Key considerations relevant to your vote CONT.

able to return greater value from its assets by remaining a standalone entity or by seeking alternative corporate transactions in the future.

You may also consider that it would be difficult to identify or invest in alternative investments that have a similar investment profile to that of Webcentral or may incur transaction costs in undertaking any new investment.

1. You may consider that there is potential for a Superior Proposal to emerge
   Since the Scheme was announced up until the Last Practicable Date, no Superior Proposal has emerged.
   It is possible that a more attractive proposal for Webcentral Shareholders could materialise in the future, such as a takeover bid, another scheme of arrangement or some other alternative transaction proposal which would deliver total consideration for Webcentral Shareholders in excess of the Scheme Consideration.
2. The tax consequences of transferring your Webcentral Shares pursuant to the Scheme may not be attractive to you
   The tax consequences of the Scheme will depend on your personal situation. You may consider that the tax consequences of transferring your Webcentral Shares to Web.com Sub pursuant to the Scheme are not attractive to you. A general guide to the taxation implications of the Scheme is contained in the Tax Adviser's Letter set out in section 8 of this Scheme Booklet. However, the Tax Adviser's Letter is expressed in general terms only, and Webcentral Shareholders should consult with their own independent taxation advisers regarding the taxation implications of the Scheme.

14 Webcentral Group Limited | Scheme Booklet

2 FREQUENTLY ASKED QUESTIONS

This section 2 answers some frequently asked questions relating to the Scheme. It is not intended to address all relevant issues for Webcentral Shareholders. This section 2 should be read in conjunction with all other parts of this Scheme Booklet.

Question		Answer		More
				information

Overview of the Scheme

Why have I	This Scheme Booklet has been sent to you because you	Section 4 of
received this	are a Webcentral Shareholder and you are being asked to	this Scheme
Scheme	vote on the Scheme Resolution. This Scheme Booklet is	Booklet
Booklet?	intended to help you to consider and decide on how to vote
	on the Scheme Resolution at the Scheme Meeting.
	If you have transferred all of your Webcentral Shares,
	please disregard this Scheme Booklet as you will not be
	entitled to vote at the Scheme Meeting.
Who is entitled	Persons who hold Webcentral Shares on the Scheme	Sections 3.2
to participate in	Record Date will participate in the Scheme and, if the	and 4 of this
the Scheme?	Scheme is implemented, those persons will receive the	Scheme
	Scheme Consideration in respect of each Webcentral Share	Booklet and
	held.	Annexure 4

What is the	The Scheme is a scheme of arrangement between
Scheme?	Webcentral and the Scheme Shareholders.
	A "scheme of arrangement" is a statutory procedure in the
	Corporations Act that is commonly used in transactions in
	Australia that may result in a change of ownership or control
	of a company. In addition to requiring Court approval,
	schemes of arrangement require a shareholder vote in
	favour of a resolution to implement the scheme of
	arrangement by the Requisite Majorities.
	If the Scheme becomes Effective, Web.com will acquire all
	of the Scheme Shares for the Scheme Consideration.
	Webcentral will be delisted from the ASX and will become a
	wholly owned Subsidiary of Web.com.

Section 4 of this Scheme Booklet and Annexure 2

Questions about the Web.com Group

Who is	Web.com is a company established in Delaware in the
Web.com?	United States of America.
	Web.com provides a range of web registration, hosting and
	associated services to businesses of all sizes to help them
	compete and succeed online through its portfolio of brands
	- Web.com, Network Solutions, Register.com,

Section 6 of this Scheme Booklet

Webcentral Group Limited | Scheme Booklet

15

2 Frequently asked questions CONT.

Question		Answer		More
				information
		CrazyDomains, Sitebeat and Vodien. Web.com's services
		are designed to meet the needs of businesses anywhere
		along their lifecycle with affordable, subscription-based
		solutions including domains, hosting, email, security,
		website design and management, internet marketing
		solutions and other value-added online services.
		Headquartered in Jacksonville, Florida, Web.com has
		operations in North America, South America, the UK,
		Australia and South East Asia.
		Web.com is indirectly wholly owned by the Siris Capital
		Funds (and five investors that indirectly own less than 5% of
		Web.com on a fully diluted basis). The Siris Capital Funds
		are managed and/or advised by Siris Capital Group, LLC
		and its affiliates. Siris Capital is a private equity firm based
		in the United States of America. Investment funds affiliated
		with Siris Capital have raised more than US$5.9 billion of
		cumulative capital since its inception in 2011.
Who is	Web.com Aus Bidco Pty Ltd (ACN 635 836 298) (Web.com	Section 6 of
Web.com Sub?	Sub) is a subsidiary of Web.com. Web.com Sub was	this Scheme
		incorporated on 28 August 2019 for the purpose of	Booklet
		acquiring Dreamscape Networks Limited (Dreamscape)
		and continues to own all of the shares in Dreamscape. It is
		proposed that Web.com Sub will acquire all the Webcentral
		Shares under the Scheme.

Voting recommendations and considerations

What do the	The Webcentral Directors unanimously recommend that you
Webcentral	vote in favour of the Scheme, in the absence of a Superior
Directors	Proposal and subject to the Independent Expert continuing
recommend?	to conclude that the Scheme is in the best interests of
	Webcentral Shareholders.
	The reasons for this recommendation and other relevant
	considerations are set out in sections 1 and 4 of this
	Scheme Booklet.
	The Webcentral Directors encourage you to seek
	independent legal, financial, taxation or other appropriate
	professional advice.

Letter from the Chair of the Webcentral Board at the front of this Scheme Booklet and sections 1 and 4 of this Scheme Booklet

What are the	Each Webcentral Director intends to vote, or procure the	Letter from
intentions of the	voting of, any Webcentral Shares held or controlled by him	the Chair of
Webcentral	at the time of the Scheme Meeting in favour of the Scheme	the
Directors?	at the Scheme Meeting in the absence of a Superior	Webcentral
	Proposal and subject to the Independent Expert continuing	Board at the
	to conclude that the Scheme is in the best interests of	front of this
	Webcentral Shareholders.	Scheme
		Booklet

16 Webcentral Group Limited | Scheme Booklet

Question		Answer		More
				information
What is the	The Independent Expert has concluded that the Scheme is	Letter from
conclusion of	fair and reasonable and, therefore, is in the best interests of	the Chair of
the Independent	Webcentral Shareholders, in the absence of a superior	the
Expert?	proposal. You should also read the Independent Expert's	Webcentral
		Report which is contained in Annexure 1.	Board at the
				front of this
				Scheme
				Booklet and
				Annexure 1
What if the	If the Independent Expert changes its opinion, this will be	Section 9.4 of
Independent	announced to the ASX and the Webcentral Directors will	this Scheme
Expert changes	carefully consider the Independent Expert's revised opinion	Booklet
its conclusion?	and advise you of their recommendation.
		The Webcentral Directors may withdraw, change or qualify
		their recommendation, and may terminate the Scheme
		Implementation Deed without paying a Reimbursement Fee
		to Web.com, if in any update of, or any revision,
		amendment or supplement to, the Independent Expert's
		Report, the Independent Expert concludes that the Scheme
		is not or is no longer in the best interests of Webcentral
		Shareholders (except where that conclusion is due to a
		Competing Proposal).

Why might you vote in favour of the Scheme?

Reasons why you might vote in favour of the Scheme are	Section 1.1 of
set out in the "Reasons why you might vote for the Scheme"	this Scheme
in section 1 of this Scheme Booklet.	Booklet

Why might you	Reasons why you might vote against the Scheme are set	Section 1.2 of
vote against the	out in the "Reasons why you might vote against the	this Scheme
Scheme?	Scheme" in section 1 of this Scheme Booklet.	Booklet

An overview of the Scheme Consideration

What is the	If the Scheme is implemented, you will receive the Scheme	Section 4.1 of
Scheme	Consideration of $0.10 in cash per Webcentral Share that	this Scheme
Consideration?	you hold on the Scheme Record Date.	Booklet
When and how	If the Scheme becomes Effective, Scheme Shareholders	Section 4.2 of
will I receive my	will be sent the Scheme Consideration on the	this Scheme
Scheme	Implementation Date (currently expected to be 12 October	Booklet
Consideration?	2020).
	Scheme Shareholders who have validly registered their
	bank account details with the Webcentral Share Registry
	before the Scheme Record Date may have their Scheme
	Consideration sent directly to their bank account.

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2 Frequently asked questions CONT.

Question		Answer		More
				information
		Otherwise, Scheme Shareholders will have their Scheme
		Consideration sent by cheque in Australian currency to their
		address shown on the Webcentral Share Register.
Will I have to	You will not have to pay brokerage on the transfer of your	Section 1.1(i)
pay brokerage?	Webcentral Shares to Web.com Sub under the Scheme.	of this
				Scheme
				Booklet

What are the taxation implications of the Scheme?

The taxation implications of the Scheme will depend on your particular circumstances.

Section 8 of this Scheme Booklet contains the Tax Adviser's Letter which provides a general description of the Australian taxation consequences for Scheme Shareholders.

You should seek independent professional taxation advice with respect to your particular circumstances.

Section 8 of this Scheme Booklet

Conditions to, and approval of, the Scheme

Are there any conditions to the Scheme?

Yes. The conditions to the Scheme are summarised in section 9.4(c) of this Scheme Booklet.

The conditions include customary conditions in schemes of arrangement (such as Webcentral Shareholder approval, Court approval and the Independent Expert continuing to conclude that the Scheme is in the best interests of Webcentral Shareholders) as well as FIRB approval. The condition relating to the Customer Dispute has been satisfied following the settlement of the Customer Dispute on terms and conditions acceptable to Web.com.

Sections 5.5 and 9.4(c) of this Scheme Booklet

What is required for the Scheme to become Effective?

The Scheme will become Effective if:

• the Scheme is approved by the Requisite Majorities of Webcentral Shareholders at the Scheme Meeting currently scheduled to be held on 29 September 2020;
• the Court approves the Scheme at the Second Court Hearing; and
• all of the other Conditions Precedent are satisfied or waived (if capable of waiver).

Both Webcentral and Web.com have the right to terminate the Scheme Implementation Deed if the Effective Date has not occurred, or will not occur, on or before the End Date.

Sections 4.4 and 9.4(c) of this Scheme Booklet

18 Webcentral Group Limited | Scheme Booklet

Question		Answer		More
				information
Are there any	Yes. The Scheme is subject to FIRB approval. In summary,	Section 9.4(c)
regulatory	this condition requires that Web.com obtain written notice	of this
approvals	under theForeign Acquisitions and Takeovers Act 1975	Scheme
required for the	(Cth), by or on behalf of the Treasurer of the	Booklet
Scheme to	Commonwealth of Australia, advising that the
become	Commonwealth Government has no objections to the
Effective?	Transaction, either without conditions or with conditions
		acceptable to Web.com acting reasonably.
		Web.com has received confirmation from the ACCC that it
		will not oppose the Scheme.
		The Scheme is not conditional upon any other regulatory
		approvals.

When and where will the Scheme Meeting be held?

The Scheme Meeting is scheduled to be held at 9.00am	Annexure 4
(Sydney time) online and by teleconference on 29
September 2020.
In response to Government restrictions and the potential
health risks arising from the COVID-19 pandemic, the
Scheme Meeting will be held virtually. There will be no
physical meeting. See the Notice of Scheme Meeting in
Annexure 4 for further details relating to the conduct of the
Scheme Meeting.
The Scheme Meeting may be adjourned. Any such
adjournment will be announced on the ASX and set out on
Webcentral's website.

What will	At the Scheme Meeting, Webcentral Shareholders will be	Annexure 4
Webcentral	asked to vote on whether to approve the Scheme.
Shareholders be
asked to vote on
at the Scheme
Meeting?

What is the Webcentral Shareholder approval threshold for the Scheme?

In order to become Effective, the Scheme must be approved by the Requisite Majorities, being:

• unless the Court orders otherwise, a majority in number (more than 50%) of Webcentral Shareholders present and voting at the Scheme Meeting (either in person or by proxy, attorney or, in the case of corporate Webcentral Shareholders, body corporate representative); and
• at least 75% of the total number of votes cast on the Scheme Resolution at the Scheme Meeting by Webcentral Shareholders present and voting (either in person or by proxy, attorney or, in the case of corporate Webcentral Shareholders, body corporate representative).

Even if the Scheme is approved by the Requisite Majorities

Section 4.4 of this Scheme Booklet

Webcentral Group Limited | Scheme Booklet

19

2 Frequently asked questions CONT.

Question		Answer		More
				information
		of Webcentral Shareholders at the Scheme Meeting, the
		Scheme is still subject to the approval of the Court.
Is voting	Voting is not compulsory. However, the Scheme will only be	Sections 3
compulsory?	successful if it is approved by the Webcentral Shareholders	and 4.3 of this
		by the Requisite Majorities, so voting is important and the	Scheme
		Webcentral Directors encourage you to vote.	Booklet
		If the Scheme Resolution is approved, you will be bound by
		the Scheme Resolution, whether or not you voted and
		whether or not you voted in favour of it.
Am I entitled to	If you are registered as a Webcentral Shareholder on the	Section 3.2 of
vote at the	Webcentral Share Register as at 7.00pm (Sydney time) on	this Scheme
Scheme	27 September 2020, you will be entitled to attend and vote	Booklet and
Meeting?	at the Scheme Meeting.	Annexure 4
How can I vote if	If you would like to vote but cannot attend the Scheme	Annexure 4
I can't attend	Meeting online, you can vote by appointing a proxy
the Scheme	(including by lodging your proxy form online at
Meeting?	https://investorcentre.linkmarketservices.com.au/voting/wcg)
		or an attorney to attend and vote on your behalf. You may
		also vote by body corporate representative if that option is
		applicable to you.
When will the	The results of the Scheme Meeting are expected to be	N/A
results of the	available shortly after the conclusion of the Scheme
Scheme Meeting	Meeting and will be announced to the ASX
be known?	(www.asx.com.au) once available.

What happens if Webcentral Shareholders or the Court do not approve the Scheme or the Scheme does not otherwise proceed?

If the Scheme is not approved at the Scheme Meeting, or if	Sections 1.1,
it is approved at the Scheme Meeting but is not approved by	5.4, 7, 9.4(c)
the Court or a Condition Precedent is not fulfilled or	and 9.4(j) of
otherwise waived (if capable of waiver), then the Scheme	this Scheme
will not become Effective and will not be implemented.	Booklet
If the Scheme does not become Effective or is not
implemented, the Webcentral Group will continue to operate
as a standalone group listed on the ASX. In considering the
future of Webcentral as an ASX-listed entity, Webcentral
Shareholders should have regard to the risks outlined in
section 5.4 and section 7 of this Scheme Booklet.
In that scenario, Webcentral Shareholders will not receive
the Scheme Consideration but will retain their Webcentral

20 Webcentral Group Limited | Scheme Booklet

Question		Answer		More
				information
		Shares. Webcentral will continue to be prohibited from
		making distributions to Webcentral Shareholders20, and
		Webcentral Shareholders will remain exposed to the various
		risks associated with Webcentral and its business.
		Additionally, absent the Scheme, whether or not the
		Existing Financiers continue to provide the Existing Debt
		Facilities, Webcentral may require additional funding.
		Absent such additional funding, there is a real risk that
		Webcentral will have insufficient liquidity to meet its debts
		as and when they fall due, which may require the
		Webcentral Directors to consider the appointment of a
		voluntary administrator on the basis that Webcentral may be
		insolvent or likely to become insolvent in the near future.
		For further information, see section 5.4 of this Scheme
		Booklet.
		Depending on the reason for the Scheme not proceeding,
		Webcentral may be liable to pay a Reimbursement Fee to
		Web.com of $500,000 (excluding GST). No Reimbursement
		Fee would be payable, however, if the Scheme does not
		proceed for the sole reason that Webcentral Shareholders
		do not pass the Scheme Resolution at the Scheme Meeting.
What happens	If you do not vote, or vote against the Scheme, and the	Section 4.3 of
to my	Scheme becomes Effective and is implemented, any	this Scheme
Webcentral	Scheme Shares held by you on the Scheme Record Date	Booklet
Shares if I do	(currently expected to be 7.00pm (Sydney time) on 7
not vote, or if I	October 2020) will be transferred to Web.com Sub and you
vote against the	will receive the Scheme Consideration, despite not having
Scheme, and	voted or having voted against the Scheme.
the Scheme
becomes
Effective and is
implemented?
When will the	Subject to satisfaction or waiver (if capable of waiver) of the	Section 4.4 of
Scheme become	Conditions Precedent, the Scheme will become Effective on	this Scheme
Effective and	the Effective Date (currently expected to be 1 October	Booklet
when will it be	2020) and will be implemented on the Implementation Date
implemented?	(currently expected to be 12 October 2020).

20Webcentral may make distributions with the prior written consent of the Existing Financiers. If the Scheme is not implemented, it is expected to be very challenging for Webcentral to agree a solution with the Existing Financiers under which distributions to Webcentral Shareholders would be permitted. See section 5.4 of this Scheme Booklet for further details of the Existing Debt Facilities.

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21

2 Frequently asked questions CONT.

Question		Answer		More
				information
Other questions

What happens if

• Competing Proposal is received?

If a Competing Proposal is received, the Webcentral Directors will carefully consider it.

Webcentral must notify Web.com of that Competing Proposal in accordance with the Scheme Implementation Deed.

Webcentral Shareholders should note that Webcentral has agreed to certain exclusivity provisions in favour of Web.com under the Scheme Implementation Deed. The Scheme Implementation Deed contains the following customary exclusivity provisions:

• no shop;
• no talk (subject to a fiduciary out);
• notification right for Web.com if Webcentral is approached in relation to a Competing Proposal (subject to a fiduciary out); and
• a5-Business Day matching right period.

Sections 9.4(i) and 9.5 of this Scheme Booklet

Can I sell my	You can sell your Webcentral Shares on market at any time	Section 4.3 of
Webcentral	before the close of trading on the ASX on the Effective Date	this Scheme
Shares now?	at the then prevailing market price (which may vary from the	Booklet
	Scheme Consideration).
	Webcentral intends to apply to the ASX for Webcentral
	Shares to be suspended from trading on the ASX from
	close of trading on the Effective Date. You will not be able
	to sell your Webcentral Shares on market after this date.
	If you sell your Webcentral Shares on market, you may pay
	brokerage on the sale, you will not receive the Scheme
	Consideration and there may be different tax consequences
	compared to those that would arise if you retain those
	shares until the Scheme is implemented.
Will I have to	Yes. Each Scheme Shareholder is taken to have warranted	Section 4.5 of
give any	to Webcentral and Web.com Sub on the Implementation	this Scheme
warranties in	Date that all their Webcentral Shares (including any rights	Booklet
connection with	and entitlements attaching to those shares) which are
the Scheme?	transferred under the Scheme will, at the date of transfer,
	be fully paid and free from various encumbrances and
	interests of third parties, and restrictions on transfer, and
	that they have full power and capacity to transfer their
	Scheme Shares to Web.com Sub together with any rights
	attaching to those shares and they have no existing right to
	be issued any other Webcentral Shares or any other form of
	Webcentral securities.

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Question		Answer		More
				information
What if I have	For further information, shareholders can call the	N/A
further	Webcentral Shareholder information line on 1300 853 816
questions about	(within Australia) or [phone] (outside Australia)
the Scheme?	between 8.30am and 7.30pm (Sydney time), Monday to
		Friday, excluding public holidays.
		If you are in doubt about anything in this Scheme Booklet,
		please contact your financial, legal, taxation or other
		professional adviser immediately.

What are the risks associated with the Webcentral business in relation to COVID-19?

The Webcentral Group is exposed to general economic risks posed by the ongoing COVID-19 outbreak.

While future revenues may be negatively impacted, at this time the Webcentral Group is unable to estimate the exact scope and any financial impact the COVID-19 outbreak may have on the Webcentral Group's operations in the future.

Section 7.3 of this Scheme Booklet

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3 HOW TO VOTE

3.1 What you should do

You should carefully read this Scheme Booklet in its entirety before deciding whether to vote in favour of the Scheme.

If you have any questions, please contact the Webcentral Shareholder information line on 1300 853 816 (within Australia) or [phone] (outside Australia) between 8.30am and 7.30pm (Sydney time), Monday to Friday, excluding public holidays.

If you are in any doubt as to what you should do, please consult your legal, financial, tax or other professional adviser without delay.

A copy of this Scheme Booklet may be obtained by anyone entitled to attend the Scheme Meeting from the Investor Centre section of the Webcentral website (www.webcentralgroup.com.au) or the ASX website (www.asx.com.au) or by calling the Webcentral Shareholder information line (using the details above).

3.2 Who is entitled to vote at the Scheme Meeting?

If you are registered on the Webcentral Share Register as at 7.00pm (Sydney time) 27 September 2020, you will be entitled to attend and vote at the Scheme Meeting.

Information on entitlements to vote, including if you are a joint holder of Webcentral Shares, is contained in the Notice of Scheme Meeting which is attached as Annexure 4.

3.3 Your vote is important

In order for the Scheme to be implemented, the Scheme Resolution must be approved by Webcentral Shareholders by the Requisite Majorities at the Scheme Meeting. For this reason, the Webcentral Directors unanimously recommend that you vote in favour of the Scheme, in the absence of a Superior Proposal and subject to the Independent Expert continuing to conclude that the Scheme is in the best interests of Webcentral Shareholders.

If you are unable to attend the Scheme Meeting, the Webcentral Directors urge you to complete and return, in the enclosed reply paid envelope, the personalised proxy form that accompanies this Scheme Booklet or lodge your proxy form online at https://investorcentre.linkmarketservices.com.au/voting/wcgin accordance with the instructions given there.

3.4 Location and details of the Scheme Meeting

The details of the Scheme Meeting are as follows:

• Date:29 September 2020
• Time:9.00am (Sydney time)

In response to Government restrictions and the potential health risks arising from the COVID-19 pandemic, the Scheme Meeting will be held virtually. There will be no physical meeting. See the Notice of Scheme Meeting in Annexure 4 for further details relating to the conduct of the Scheme Meeting.

3.5 Notice of Scheme Meeting

The Notice of Scheme Meeting is contained in Annexure 4.

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3.6 Voting

Voting at the Scheme Meeting will be conducted by poll.

If you are a Webcentral Shareholder entitled to vote at the Scheme Meeting, you may vote:

• in person:by attending and voting online or by teleconference;
• by proxy:by appointing one or two proxies to attend the Scheme Meeting and vote on your behalf, by completing, signing and returning, in the enclosed reply paid envelope, the personalised proxy form that accompanies this Scheme Booklet or lodging your proxy form online at https://investorcentre.linkmarketservices.com.au/voting/wcgin accordance with the instructions given there;
• by attorney:by appointing an attorney to attend the Scheme Meeting and vote on your behalf, using a duly executed power of attorney; or
• by corporate representative:in the case of a body corporate, by appointing a body corporate representative to attend the Scheme Meeting and vote on your behalf, using a duly executed certificate of appointment of body corporate representative.

Further information on how to vote using each of these methods is contained in the Notice of Scheme Meeting attached as Annexure 4.

If you are in favour of the Scheme, you should vote in favour of the Scheme.

The Scheme will not be implemented unless the Scheme is approved by the Requisite Majorities of Webcentral Shareholders at the Scheme Meeting.

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4 OVERVIEW OF THE SCHEME

4.1 Scheme Consideration

If the Scheme becomes Effective, Webcentral Shareholders who are registered as such on the Scheme Record Date will receive the Scheme Consideration of $0.10 per Webcentral Share.

The Scheme will not become Effective unless all of the Conditions Precedent to the Scheme are satisfied or waived (if capable of waiver) in accordance with the Scheme Implementation Deed. The Conditions Precedent are summarised in section 9.4(c) of this Scheme Booklet.

4.2 Provision of Scheme Consideration

If the Scheme becomes Effective, the Scheme Consideration will be sent to Scheme Shareholders on the Implementation Date (currently expected to be 12 October 2020).

Scheme Shareholders who have validly registered their bank account details with the Webcentral Share Registry before the Scheme Record Date may have their Scheme Consideration sent directly to their bank account. Otherwise, Scheme Shareholders will have their Scheme Consideration sent by cheque in Australian currency to their address shown on the Webcentral Share Register.

It is important to note that you will only receive the Scheme Consideration if you are a Scheme Shareholder. You will be a Scheme Shareholder if you hold Webcentral Shares at the Scheme Record Date (currently expected to be 7.00pm (Sydney time) on 7 October 2020, or such other time and date as Webcentral and Web.com agree in writing).

4.3 Your choices as a Webcentral Shareholder

As a Webcentral Shareholder, you have four choices currently available to you, which are as follows:

Vote in favour	This is the course of action unanimously recommended by the Webcentral
of the	Directors, in the absence of a Superior Proposal and subject to the
Scheme	Independent Expert continuing to conclude that the Scheme is in the best
	interests of Webcentral Shareholders.
	To follow the Webcentral Directors' unanimous recommendation, you should
	vote in favour of the Scheme at the Scheme Meeting on 29 September 2020.
	For a summary of how to vote on the Scheme, please refer to section 3 of this
	Scheme Booklet and the Notice of Scheme Meeting contained in Annexure 4.
Vote against	If, despite the Webcentral Directors' unanimous recommendation and the
the Scheme	Independent Expert's conclusion that the Scheme is fair and reasonable and
	therefore, is in the best interests of Webcentral Shareholders, you do not support
	the Scheme, you may vote against the Scheme at the Scheme Meeting on 29
	September 2020.
	However, if all the Conditions Precedent to the Scheme are satisfied or waived
	(if capable of waiver) and the Scheme becomes Effective and is implemented,
	the Scheme will bind all Webcentral Shareholders, including those who vote
	against the Scheme Resolution at the Scheme Meeting and those who do not
	vote at all.

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Sell your	The Scheme does not preclude you from selling some or all of your Webcentral
Webcentral	Shares on market for cash, if you wish, provided you do so before close of
Shares on the	trading on the ASX on the Effective Date (currently expected to be 1 October
ASX	2020), when trading in Webcentral Shares will end.
	If you are considering selling some or all of your Webcentral Shares:
	•you should have regard to the prevailing trading prices of Webcentral Shares
	and compare those to the Scheme Consideration. You may ascertain the
	current trading prices of Webcentral Shares through the ASX website
	(www.asx.com.au); and
	•you should contact your stockbroker for information on how to effect that
	sale, and you should also contact your financial, taxation, legal or other
	professional adviser.
	Webcentral Shareholders who sell some or all of their Webcentral Shares on
	market:
	•may receive payment (which may vary from the Scheme Consideration) for
	the sale of their Webcentral Shares sooner than they would receive the
	Scheme Consideration under the Scheme;
	•may incur a brokerage charge;
	•will not be able to participate in the Scheme or, if one emerges, a Superior
	Proposal, in respect of those Webcentral Shares they have sold; and
	•may be liable for capital gains tax (CGT) on the disposal of their Webcentral
	Shares (as they also may be under the Scheme - see the Tax Adviser's
	Letter set out in section 8 of this Scheme Booklet).

Do nothingWebcentral Shareholders who elect not to vote at the Scheme Meeting on 29 September 2020 or do not sell their Webcentral Shares on market will:

• if the Scheme is implemented - have their Webcentral Shares transferred to Web.com Sub by operation of the Scheme and receive the Scheme Consideration; or
• if the Scheme is not implemented - retain their Webcentral Shares.

4.4 Key steps in the Scheme

1. Scheme Meeting and Scheme approval requirements

The Court has ordered Webcentral to convene the Scheme Meeting at which Webcentral Shareholders will be asked to approve the Scheme.

The terms of the Scheme Resolution to be considered at the Scheme Meeting are contained in the Notice of Scheme Meeting in Annexure 4.

The Scheme will only become Effective and be implemented if it is:

• approved by the Requisite Majorities of Webcentral Shareholders at the Scheme Meeting to be held on 29 September 2020;
• approved by the Court at the Second Court Hearing; and
• the Conditions Precedent in relation to the Scheme outlined in section 9.4(c) of this Scheme Booklet are satisfied or waived (if capable of waiver).

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4 Overview of the Scheme CONT.

The Requisite Majorities of Webcentral Shareholders to approve the Scheme are:

• unless the Court orders otherwise, a majority in number (more than 50%) of Webcentral Shareholders present and voting at the Scheme Meeting (either in person or by proxy, attorney or, in the case of corporate Webcentral Shareholders, body corporate representative); and
• at least 75% of the total number of votes cast on the Scheme Resolution at the Scheme Meeting by Webcentral Shareholders present and voting (either in person or by proxy, attorney or, in the case of corporate Webcentral Shareholders, body corporate representative).

The Court has the power to waive the first requirement.

The entitlement of Webcentral Shareholders to attend and vote at the Scheme Meeting is set out in the Notice of Scheme Meeting in Annexure 4.

Voting is not compulsory. However, the Webcentral Directors unanimously recommend that Webcentral Shareholders vote in favour of the Scheme in the absence of a Superior Proposal, and subject to the Independent Expert continuing to conclude that the Scheme is in the best interests of Webcentral Shareholders.

You should be aware that even if you do not vote, or vote against the Scheme, the Scheme may still be implemented if it is approved by the Requisite Majorities of Webcentral Shareholders and the Court. If this occurs, your Webcentral Shares will be transferred to Web.com Sub and you will receive the Scheme Consideration even though you did not vote on, or voted against, the Scheme.

The results of the Scheme Meeting will be available as soon as possible after the conclusion of the Scheme Meeting and will be announced to the ASX (www.asx.com.au) once available.

1. Court approval of the SchemeIn the event that:

• the Scheme is approved by the Requisite Majorities of Webcentral Shareholders at the Scheme Meeting; and
• all Conditions Precedent (except Court approval of the Scheme) have been satisfied or waived (if capable of waiver),

then Webcentral will apply to the Court for orders approving the Scheme.

Each Webcentral Shareholder has the right to appear at the Second Court Hearing.

1. Effective Date

If the Court approves the Scheme, the Scheme will become Effective on the Effective Date, being the date an office copy of the Court order from the Second Court Hearing approving the Scheme is lodged with ASIC. Webcentral will, on the Scheme becoming Effective, give notice of that event to the ASX.

Webcentral intends to apply to the ASX for Webcentral Shares to be suspended from trading on the ASX from close of trading on the Effective Date.

1. Scheme Record Date and entitlement to Scheme Consideration

Those Webcentral Shareholders who are recorded on the Webcentral Share Register on the Scheme Record Date (currently expected to be 7.00pm (Sydney time) on 7 October 2020) will be entitled to receive the Scheme Consideration in respect of the Webcentral Shares they hold at that time.

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1. Dealings in Webcentral Shares on, or prior to, the Scheme Record Date

For the purposes of determining which Webcentral Shareholders are eligible to participate in the Scheme, dealings in Webcentral Shares will be recognised only if:

• in the case of dealings of the type to be effected using CHESS, the transferee is registered on the Webcentral Share Register as the holder of the relevant Webcentral Shares before the Scheme Record Date; and
• in all other cases, registrable transfer or transmission applications in respect of those dealings, or valid requests in respect of other alterations, are received by the Webcentral Share Registry before the Scheme Record Date,

and the transferee remains registered as at the Scheme Record Date. For the purposes of determining entitlements under the Scheme, Webcentral will not accept for registration or recognise any transfer or transmission applications in respect of Webcentral Shares received after the Scheme Record Date.

1. Dealings in Webcentral Shares after the Scheme Record Date

For the purpose of determining entitlements to the Scheme Consideration, Webcentral must maintain the Webcentral Share Register in its form as at the Scheme Record Date until the Scheme Consideration has been paid to the Scheme Shareholders. The Webcentral Share Register in this form will solely determine entitlements to the Scheme Consideration.

After the Scheme Record Date:

• all statements of holding for Webcentral Shares (other than statements of holding in favour of Web.com Sub) will cease to have effect as documents relating to title in respect of such Webcentral Shares; and
• each entry on the Webcentral Share Register (other than entries on the Webcentral Share Register in respect of Web.com Sub) will cease to have effect except as evidence of entitlement to the Scheme Consideration in respect of the Webcentral Shares relating to that entry.

1. Implementation Date

By no later than the Business Day before the Implementation Date (currently expected to be 12 October 2020), Web.com will deposit (or will procure the deposit) into a Webcentral-operated Australian dollar denominated trust account with an authorised deposit taking institution in Australia as trustee for the Scheme Shareholders, an amount equal to the aggregate Scheme Consideration to be provided to Scheme Shareholders.

Scheme Shareholders will be sent the Scheme Consideration on the Implementation Date. Immediately after the Scheme Consideration is sent to Scheme Shareholders, the Scheme Shares will be transferred to Web.com Sub.

1. Deed Poll

As at the date of this Scheme Booklet, a Deed Poll has been entered into by Web.com and Web.com Sub in favour of the Scheme Shareholders, to:

• provide the aggregate amount of the Scheme Consideration payable to Scheme Shareholders under the Scheme, subject to the Scheme becoming Effective; and
• undertake all other actions attributed to Web.com and Web.com Sub under the Scheme.

A copy of the Deed Poll is contained in Annexure 3.

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4 Overview of the Scheme CONT.

4.5 Warranties by Webcentral Shareholders

The terms of the Scheme provide that each Scheme Shareholder is taken to have warranted to Webcentral and Web.com Sub on the Implementation Date, and appointed and authorised Webcentral as its attorney and agent to warrant to Web.com Sub on the Implementation Date, that:

• all their Webcentral Shares (including any rights and entitlements attaching to those shares) which are transferred under the Scheme will, at the date of transfer, be fully paid and free from all mortgages, charges, liens, encumbrances, pledges, security interests (including any 'security interests' within the meaning of section 12 of thePersonal Property Securities Act 2009(Cth)) and interests of third parties of any kind, whether legal or otherwise, and restrictions on transfer of any kind;
• they have full power and capacity to transfer their Scheme Shares to Web.com Sub together with any rights attaching to those shares; and
• they have no existing right to be issued any other Webcentral Shares or any other form of Webcentral securities.

Under the terms of the Scheme, Webcentral undertakes that it will provide such warranties to Web.com Sub as agent and attorney of each Scheme Shareholder.

4.6 Delisting of Webcentral

Webcentral will apply for the termination of the official quotation of Webcentral Shares on the ASX and for Webcentral to be removed from the official list of the ASX, each to occur on a date after the Implementation Date.

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5 INFORMATION ABOUT WEBCENTRAL AND THE WEBCENTRAL GROUP

5.1 Introduction and business overview

The Webcentral Group is an Australian full-service digital services partner for small and medium businesses in the various stages of their online journey, from inception to acceleration.

Since its incorporation in 1996, Webcentral (previously called Melbourne IT Limited and Arq Group Limited) has helped the digital success of more than one million Australian and New Zealand small to medium businesses.

With roots in domain name and hosting, Webcentral are the small and medium business digital growth solution experts helping businesses get online, improve their online performance, and protect their online presence.

The Webcentral Group consists of the brands Netregistry, WME, Melbourne IT and Domainz.

Through the Netregistry, WME, Domainz and Melbourne IT brands, the Webcentral Group is well positioned to offer small and medium business customers affordable domain, hosting, email and digital marketing services to help them get online, improve their online performance and protect their online brand. The Webcentral Group is committed to delivering outcomes for customers with a clearly defined return on their digital investment.

The SMB division caters for the two core customer proposition categories of 'Get Online' and 'Improve Online Performance'. 'Get Online' domain, website hosting, email products and templated website builds are the primary products sold, supporting small business customers in the initial stage of their online journey primarily through the Netregistry brand. Bespoke website builds and scalable integrated digital performance marketing programs sold under the WME brand help our customers improve their online performance.

During 2019 and into 2020, Webcentral's SMB division concentrated efforts on three key areas. The first area was sustainable and ongoing cost management that sought to reduce costs without impacting the ability of the business to deliver both strong top line revenue growth in digital solutions or negatively impact its ability to service and retain its large base of foundations customers. The second area of focus was stabilisation of revenues in the large foundations customer base, primarily composing domain names, web hosting and associated services lines of business. This was driven largely by streamlining the processes in Webcentral's onshore and offshore customer care teams. The third area of focus was a return to growth in new digital business in both the WME and Netregistry brands.

The overall focus of Webcentral's SMB division has moved away from solely being an acquisition and retention business in subscriptions and shifted towards a focus on helping customers' businesses thrive online.

5.2 Webcentral Board and key management personnel

The Webcentral Board comprises the following directors:

Name		Position
Andrew Reitzer	Non-Executive Director and Chair
Andrew Macpherson	Non-Executive Director

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5 Information about Webcentral and the Webcentral Group CONT.

NamePosition

Karl Siegling	Non-Executive Director

At the time of announcement of the Scheme, Mr Larry Bloch was also a director of Webcentral. As announced on 17 August 2020, Mr Larry Bloch resigned as a director of Webcentral, effective 16 August 2020, for personal family reasons.

Webcentral's executive team comprises the following key management personnel:

Name		Position
Brett Fenton	Interim Chief Executive Officer
Brendan White	Interim Chief Financial Officer

5.3 The 2019 / 2020 strategic review

During 2019, Webcentral continued to implement a recovery plan that had been initiated in the second half of 2018 to address lower than expected solutions sales in its SMB division. Despite improvements in the SMB division following implementation of this plan, however, on 26 June 2019 Webcentral announced to the ASX that its Enterprise division was also facing challenges and that, accordingly, Webcentral's forecast underlying EBITDA from its core operations for FY19 had been revised down.

Webcentral affirmed this guidance in its half year results announced to the ASX on 22 August 2019, based on projections of recovery in its Enterprise division during the remainder of FY19. However, it quickly became apparent that this recovery would not materialise, and that this underperformance could not be addressed by cost-cutting alone. Accordingly, Webcentral released a further announcement on 24 September 2019, advising that its previous forecast for underlying EBITDA had been significantly reduced.

Against that background, Webcentral had received informal and preliminary approaches from parties interested in discussing value-creating opportunities relating to both its SMB and Enterprise divisions. In light of this, Webcentral's announcement to the ASX on 24 September 2019 disclosed that Webcentral had appointed Macquarie Capital (Australia) Limited to undertake a strategic review, exploring all avenues for maximising shareholder value. Those avenues included, but were not limited to, the sale of one or more of the Enterprise or SMB business divisions, as well as other various capital management changes.

The announcement of the strategic review generated a number of further inbound approaches from parties interested in acquiring either the Enterprise division or the SMB division, prompting Webcentral to test the market for the sale of these businesses and initiate a structured due diligence process in October 2019. Several parties were granted additional business information and limited access to management before being invited to submit non-binding indicative offers. Webcentral received numerous offers from various potential bidders from around the globe with all offers received for either the Enterprise division or SMB division. Select parties were provided with access to a data room and invited to submit offers to acquire one or other of the business units.

Given, among other things, the greater level of interest in the Enterprise division and limited management time and resources to pursue both sale processes simultaneously, the decision was made to focus on the sale of the Enterprise division. No non-binding indicative offers were received from anyone wishing to buy both the Enterprise division and the SMB division.

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Alongside the strategic review starting to progress, as announced to the ASX on 13 November 2019, Webcentral again revised its guidance downwards due to underperformance of the Enterprise division. As noted in that announcement, Webcentral also engaged in discussions with its Existing Financiers to obtain a waiver of a breach of a covenant under its Existing Debt Facilities, which breach had been triggered by the underperformance of the business (see section 5.4 for further discussion of the Existing Debt Facilities).

On 11 February 2020, Webcentral announced that it had entered into a binding agreement to sell its Enterprise division to an entity owned by a consortium comprising Quadrant Private Equity and certain members of the Enterprise leadership team for $35 million (less a final payment of $6 million due to the vendors of InfoReady Pty Limited, which was acquired by Webcentral in 2016) on a cash free, debt free basis. The sale included the rights to the Arq brand. The sale completed on 2 March 2020 and the net proceeds were used to reduce the amounts drawn under the Existing Debt Facilities. Further information on this sale appears in section 5.7(a) below.

Certain members of the Enterprise leadership team, including then CEO, Tristan Sternson, transferred with the Enterprise division. Accordingly, following the sale of the Enterprise division, the then head of the SMB division, Brett Fenton, was promoted to interim CEO to drive the remainder of the strategic review process, which continued with a focus on the potential sale of the SMB division.

A number of parties that expressed interest in the SMB division were granted due diligence access and submitted non-binding indicative proposals to acquire Webcentral.

Certain of those proposals required the Existing Financiers to extend the maturity date of the Existing Debt Facilities and/or to compromise part of the principal amount outstanding under the Existing Debt Facilities. Neither of these conditions were acceptable to the Existing Financiers, whose fundamental requirements are to be repaid in full. Further, certain proposals were also insufficiently constructed at the time of submission and did not have committed financing to enable the Existing Debt Facilities to be repaid in full upon implementation of the proposals, which (as mentioned in section 5.4 of this Scheme Booklet) was again not acceptable to the Existing Financiers.

The scheme of arrangement proposed by Web.com emerged from the strategic review as the superior offer for Webcentral Shareholders, balancing the maximisation of shareholder value with transaction certainty. The Scheme was announced to the ASX on 13 July 2020.

5.4 Webcentral's Existing Debt Facilities

The Webcentral Group requires the ongoing support of the Existing Financiers, and the Existing Debt Facilities, to continue as a going concern.

The Existing Debt Facilities were originally entered into in June 2018 to replace the previous debt facilities available to the Webcentral Group. In response to certain actual financial covenant breaches (in the quarter ended 30 September 2019) and certain anticipated (but later realised) financial covenant breaches (in the quarter ended 31 December 2019), Webcentral and the Existing Financiers amended the terms of the Existing Debt Facilities on 23 December 2019. The revised Existing Debt Facilities provided the Webcentral Group with access to:

• committed funding of up to $61.2 million; and
• uncommitted funding of up to $7.5 million.

The Existing Financiers imposed certain conditions on the Webcentral Group as part of amending the Existing Debt Facilities, including (among other things):

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5 Information about Webcentral and the Webcentral Group CONT.

• inserting a review event, to be tested on 31 January 2020, relating to the amount outstanding to the Existing Financiers on that date (31 January Review Event); and
• requiring Webcentral, and the majority of its subsidiaries, to grantall-assets security in favour of the Existing Financiers to secure the entire amount outstanding under the Existing Debt Facilities.

The amendments to the Existing Debt Facilities enabled Webcentral to draw $2.5 million in December 2019, and a further $2.5 million in February 2020, to assist with funding working capital requirements.

Webcentral subsequently paid down $22.108 million of the total drawn debt using proceeds received from the sale of the Enterprise division in March 2020 (see section 5.3).

There are no monetary or non-monetary defaults subsisting under the Existing Debt Facilities as of the Last Practicable Date. However, the 31 January Review Event is subsisting as of the Last Practicable Date. Accordingly, the Existing Financiers have the right to cancel, and demand repayment of, the Existing Debt Facilities upon providing Webcentral with 60 days' written notice.

Under the Existing Debt Facilities, Webcentral is prohibited from making distributions to Webcentral Shareholders without the prior written consent of the Existing Financiers. On 6 February 2020, the Existing Financiers advised Webcentral that until such time as the 31 January Review Event has been remedied to their satisfaction, or waived by them in writing, no further distributions may be made. As noted above, the 31 January Review Event is subsisting as of the Last Practicable Date. If the Scheme does not become Effective, it is expected to be very challenging for Webcentral to agree a solution with the Existing Financiers under which distributions to Webcentral Shareholders would be permitted.

As at 31 July 2020, the total amount drawn under the Existing Debt Facilities was approximately $47.6 million. This amount includes:

• approximately $41.6 million of term debt;
• bank guarantees of approximately $5.5 million, of which approximately $1.9 million are subject to guarantees held in favour of Webcentral fromsub-tenants. Net exposure after deducting these back-to-back arrangements is approximately $4.1 million; and
• an interest rate hedge, of which the estimatedmark-to-market valuation as at 31 July 2020 is approximately $450,000.

Additionally, as at 31 March 2020, Webcentral's Net Leverage Ratio was approximately 4.01x.21This represents a significantly higher figure than the financial covenants established under the Existing Debt Facilities and is above the figures reported by certain of Webcentral's ASX-listed peers in the IT services sector.

The total amount drawn under the Existing Debt Facilities matures on 2 July 2021.22

The Existing Financiers have provided support to Webcentral throughout its strategic review process (see section 5.3 above), allowing Webcentral time to explore potential solutions to its declining performance, high Net Leverage Ratio and pending debt maturity. For example:

1. Based on net debt of $41.93 million and consolidated EBITDA for the 12 months ended 31 March 2020 of $10.45 million.
2. This excludes an amount of $2.5 million, which matures on 30 November 2020.

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• Webcentral sought, and received from the Existing Financiers, an extension on the repayment of $2.5 million originally due on 31 March 2020, until 31 August 2020 - this date was later extended to 30 November 2020;
• Webcentral sought, and received from the Existing Financiers, waivers for actual and anticipated financial covenant breaches for the quarters ended 30 September 2019, 31 December 2019, 31 March 2020 and 30 June 2020; and
• although the 31 January Review Event is subsisting, and the Existing Financiers therefore have the right to cancel, and demand repayment of, the Existing Debt Facilities upon providing Webcentral with 60 days' written notice, the Existing Financiers have repeatedly chosen to reserve their rights in this regard.

Notwithstanding their previous support, there can be no assurance that the Existing Financiers will remain supportive of Webcentral if the Scheme does not become Effective.

If the Scheme does not become Effective, Webcentral will need to reach an agreement with the Existing Financiers regarding the future of the Existing Debt Facilities. In light of the repeated financial covenant breaches and the subsisting 31 January Review Event, this may be challenging.

If an agreement cannot be reached with the Existing Financiers, it is expected to be challenging for Webcentral to find an alternative refinancing solution on terms that are commercially reasonable or at all, particularly in light of the challenges that have arisen as a result of the COVID-19 pandemic, its decreasing cash receipts, committed costs, high Net Leverage Ratio and failure to satisfy its financial covenants in four consecutive reporting periods. As noted above, $2.5 million of the amount outstanding under the Existing Debt Facilities matures on 30 November 2020 which, absent the Scheme, Webcentral currently has no clear path to repaying.

Additionally, even if the Existing Financiers continue to provide the Existing Debt Facilities to Webcentral, absent the Scheme, Webcentral may require additional funding. Accordingly, absent such additional funding, there is a real risk that Webcentral may have insufficient liquidity to meet its debts as and when they fall due.

Accordingly, absent the Scheme, the Webcentral Directors may need to consider the appointment of a voluntary administrator on the basis that Webcentral may be insolvent or likely to become insolvent in the near future.

Even prior to implementation of the Scheme, Webcentral expects to require additional short-term funding and the ongoing support of the Existing Financiers to continue to provide the Existing Debt Facilities and any required additional funding to be able to continue as a going concern.

Importantly, as noted above, Web.com will ensure the full and final repayment of the entire Existing Debt Facilities.

5.5 Customer Dispute

The Conditions Precedent to the Scheme include the settlement (or the final determination by a court of competent jurisdiction, with all avenues of appeal having been exhausted) of the Customer Dispute on terms and conditions acceptable to Web.com acting reasonably.

Given the uncertainty that such litigation creates, Web.com was only willing to proceed with the Transaction subject to the inclusion of a condition requiring the settlement or final determination of the Customer Dispute on terms and conditions acceptable to Web.com, acting reasonably.

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While Webcentral continued to believe that there were strong prospects of its claim succeeding and of the cross-claim being dismissed, in reaching their recommendation in favour of the Scheme, the Webcentral Directors had regard to various factors. These include: the significant costs involved in litigation and the quantum of the cross-claim (notwithstanding Webcentral's views on its prospects), the potential business and management distraction of a lengthy litigation process, the outstanding debt of the Webcentral Group, the repeated breaches of covenants in the Webcentral Group's Existing Debt Facilities, and Web.com's commitment to repay the Webcentral Group's Existing Debt Facilities in full upon implementation of the Scheme. There is no other clear path to repayment of the Existing Debt Facilities, creating an uncertain future for the Webcentral Group in the absence of the Scheme.

To this end, Webcentral made several attempts to settle the Customer Dispute.

As announced on 20 August 2020, this resulted in Webcentral Pty Ltd, being the Webcentral Group Company party to the Customer Dispute, entering into a release and settlement agreement (Settlement Agreement) pursuant to which the Customer Dispute has been settled. Web.com confirmed to Webcentral in writing that the terms and conditions of the Settlement Agreement were acceptable to Web.com and that, accordingly, the Condition Precedent relating to the Customer Dispute has been satisfied.

The terms of the Settlement Agreement provide for the release by both parties of any and all claims they may have in relation to the subject matter of the Customer Dispute. Each party has agreed to settle its claims for nil payment to the other. Under the Settlement Agreement, the Webcentral Group has agreed to provide the customer with certain services free of charge until 31 December 2020. The parties have agreed to use all reasonable endeavours to terminate those services by 31 December 2020, and that the Webcentral Group's obligations in relation to those services shall in any event terminate on or before 31 March 2021.

5.6 Historical financial information

1. Basis of preparation

The historical financial information in this section 5.6 has been derived from Webcentral's audited financial statements for the years ended 31 December 2018 and 31 December 2019, and should be read in conjunction with the notes included in those financial reports.

The financial information in this section 5.6 is a summary only and was prepared for the purpose of this Scheme Booklet. The historical financial information of Webcentral is presented in an abbreviated form and does not contain all the disclosures, presentation, statements or comparatives that are usually provided in an annual report prepared in accordance with the Corporations Act. Webcentral considers that for the purposes of this Scheme Booklet, the historical financial information presented in an abbreviated form is more meaningful to Webcentral Shareholders.

However, Webcentral highlights the following presentational matters that may particularly assist Webcentral Shareholders when reading the abbreviated historical consolidated financial statements set out in sections 5.6(b) to 5.6(d) below:

• Webcentral applied, for the first time,AASB 16: Leases(AASB 16) to its financial statements for the year ended 31 December 2019. The Webcentral Group has adopted the modified retrospective approach which does not require the restatement of previous financial statements. Comparative figures as at 31 December 2018 have not been restated for the effect of AASB 16 and therefore may not be directly comparable; and
• Webcentral's Enterprise division was sold on 2 March 2020 (see section 5.3). As the divestment of this division was considered to be highly probable as at 31 December 2019, the Enterprise division has been separately presented as held

36 Webcentral Group Limited | Scheme Booklet

for sale in accordance withAASB 5: Non-current Assets Held for Sale and Discontinued Operations as at 31 December 2019. The Enterprise division was also determined to be a discontinued operation for the year ended 31 December 2019, with the result that the prior period comparatives were also restated in accordance with AASB 5. Accordingly, the remainder of Webcentral's business has been defined as "continuing operations" in accordance with Australian Accounting Standards.

Further details on Webcentral's historical financial performance and position can be found in:

• its financial statements and accompanying notes for the year ended 31 December 2019 (included in the annual report released to the ASX on 30 March 2020); and
• its financial statements and accompanying notes for the year ended 31 December 2018 (included in the annual report released to the ASX on 29 March 2019),

each of which can be found in the Investor Centre section of the Webcentral website (www.webcentralgroup.com.au) or the ASX website (www.asx.com.au).

1. Historical consolidated income statement

Set out below is a summary of the historical consolidated income statement of Webcentral for the years ended 31 December 2018 and 31 December 2019:

			FY18	FY19
Income Statement			(Audited)	(Audited)
Continuing Operations
Revenue from contracts with customers	[$000]	100,094	83,615
Cost of sales	[$000]		(34,981)	(27,672)
Gross Profit	[$000]	65,113	55,943
Other income	[$000]	68	1,315
(Loss) / gain on reassessment of contingent consideration
liability	[$000]	(9,702)	98
Salaries and employee benefits expenses	[$000]	(35,685)	(30,576)
Depreciation expenses	[$000]	(4,376)	(7,026)
Amortisation of intangible assets	[$000]	(9,004)	(3,511)
Other expenses	[$000]	(18,878)	(12,953)
Finance costs	[$000]	(4,287)	(5,810)
Transaction costs	[$000]	(892)	(2,259)
Restructuring costs	[$000]	-	(365)
Impairment of goodwill	[$000]	-	(41,123)
Gain on disposal of assets	[$000]		-	554
Loss before tax	[$000]	(17,643)	(45,713)
Income tax credit / (expense)	[$000]		2,216	(238)
Loss after tax from continuing operations	[$000]	(15,427)	(45,951)
Discontinued operation	[$000]
Profit / (loss) from discontinued operation, net of tax	[$000]	13,101	(85,272)
Loss after tax for year	[$000]		(2,326)	(131,223)

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5 Information about Webcentral and the Webcentral Group CONT.

	Earnings per share	2018	2019
	Cents	Cents
	Basic loss per share	(0.13)	(38.01)
	Diluted loss per share	(0.13)	(38.01)
	Attributable to members of the parent
	Basic loss per share	(2.08)	(108.62)
	Diluted loss per share	(2.08)	(108.62)

1. Historical consolidated statement of financial position

Set out below is a summary of the historical consolidated statements of financial position of Webcentral for the years ended 31 December 2018 and 31 December 2019:

	Balance Sheet			FY18	FY19
			(Audited)	(Audited)
	Assets
	Cash and cash equivalents	[$000]	8,279	8,949
	Trade and other receivables	[$000]	26,403	13,910
	Prepayments of domain name registry charges	[$000]	7,327	7,810
	Lease receivable	[$000]	-	2,064
	Current tax refund	[$000]	-	375
	Other assets	[$000]		6,634	2,928
		[$000]	48,643	36,036
	Assets held for sale	[$000]		32,698	38,674
	Total Current Assets	[$000]	81,341	74,710
	Plant and equipment	[$000]	13,899	8,198
	Right-of-use assets	[$000]	-	16,554
	Intangible assets	[$000]	225,239	77,804
	Prepayments of domain name registry charges	[$000]	2,508	678
	Lease receivable	[$000]	-	1,830
	Deferred tax assets	[$000]	6,775	7,323
	Financial assets	[$000]	1,870	1,375
	Other assets	[$000]		696	560
	Total Non-current Assets	[$000]	250,987	114,322
	Total Assets	[$000]		332,328	189,032
	Liabilities
	Trade and other payables	[$000]	17,138	8,692
	Income received in advance	[$000]	28,632	22,792
	Current tax liability	[$000]	1,909	-
	Provisions	[$000]	3,406	1,585
	Derivative financial instruments	[$000]	80	510
	Interest bearing loans and borrowings	[$000]	-	61,929
	Other financial liabilities	[$000]	12,971	5,549
	Current lease liabilities	[$000]		-	6,160
		[$000]	64,136	107,217
	Liabilities directly associated with assets held for sale	[$000]		11,292	15,931
	Total Current Liabilities	[$000]	75,428	123,148

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	Income received in advance	[$000]	9,563	11,297
	Provisions	[$000]	3,530	3,187
	Deferred tax liabilities	[$000]	5,469	7,549
	Interest bearing loans and borrowings	[$000]	74,992	-
	Non-current lease liabilities	[$000]	850	12,970
	Total Non-Current Liabilities	[$000]	94,404	35,003
	Total Liabilities	[$000]	169,832	158,151
	Net Assets	[$000]	162,496	30,881
	Equity
	Contributed equity	[$000]	85,724	91,179
	Foreign currency translation reserve	[$000]	(552)	(533)
	Share based payments reserve	[$000]	1,136	193
	Other reserves	[$000]	9	(278)
	Retained earnings	[$000]	76,053	(59,806)
	Equity attributable to members of the parent	[$000]	162,370	30,755
	Non-controlling interest	[$000]	126	126
	Total Equity	[$000]	162,496	30,881

1. Historical consolidated statement of cash flows

Set out below is a summary of the historical consolidated statements of cash flows of Webcentral for the years ended 31 December 2018 and 31 December 2019:

				FY18	FY19
	Statement of Cash Flows			(Audited)	(Audited)
	Cash Flows from operating activities
	Receipt of service revenue and recoveries	[$000]	228,893	187,353
	Payments to suppliers and employees	[$000]	(200,828)	(168,489)
	Interest received	[$000]	68	202
	Interest paid	[$000]	(2,687)	(3,390)
	Bank charges and credit card merchant fees paid	[$000]	(1,530)	(1,135)
	Income tax refunds	[$000]	1,121	-
	Income tax paid	[$000]		(6,770)	(3,269)
	NET CASH FLOWS FROM OPERATING ACTIVITIES		18,267	11,272
	Cash Flows from Investing Activities
	Purchase of plant and equipment and intangible assets	[$000]	(13,894)	(3,423)
	Proceeds from subleases	[$000]	-	1,869
	Payment of financial liability for InfoReady earn out (incl. dividends)	[$000]	(5,668)	(4,110)
	Return of capital from Tiger Pistol	[$000]	-	505
	Transaction costs	[$000]	(85)	(2,394)
	Sale of the TPPW Reseller business	[$000]		-	21,268
	NET CASH FLOWS (USED IN) / FROM INVESTING ACTIVITIES		(19,647)	13,715
	Cash Flows from Financing Activities
	Proceeds from borrowings	[$000]	-	7,375
	Repayment of borrowings	[$000]	-	(21,292)
	Payment of dividend on ordinary shares, net of dividend
	reinvestment	[$000]	(10,361)	(4,378)
	Payment of dividend to non-controlling interests	[$000]	(105)	(80)
	Payment of lease liabilities	[$000]	(120)	(5,961)

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NET CASH FLOWS USED IN FINANCING ACTIVITIES		(10,586)	(24,336)
NET DECREASE IN CASH AND CASH EQUIVALENTS		(11,966)	651
Net foreign exchange differences	[$000]	(5)	19
Cash and cash equivalents at beginning of period	[$000]	20,250	8,279
CASH AND CASH EQUIVALENTS AT END OF PERIOD		8,279	8,949

5.7 Material changes in financial position (since Webcentral's 2019 annual report)

To the knowledge of the Webcentral Directors, as at the Last Practicable Date, there have been no material changes to the financial position of Webcentral and the Webcentral Group since 31 December 2019, save as summarised below.

1. Divestment of Enterprise division:as noted in section 5.3 above, on
   11 February 2020, Webcentral entered into an agreement to sell its Enterprise division to an entity owned by a consortium comprising Quadrant Private Equity and certain members of the Enterprise leadership team for $35 million in cash (less a final payment of $6 million due to the vendors of InfoReady Pty Limited, which was acquired by Webcentral in 2016), on a cash free, debt free basis. The sale included the rights to the Arq brand. This transaction completed on 2 March 2020 and the net proceeds were used to reduce the amounts drawn under the Existing Debt Facilities. A transitional services agreement was also entered into in connection with the Enterprise sale, and as at the date of this Scheme Booklet, the parties continue to work together to manage the smooth transition of the Enterprise business following its divestment. Upon finalisation of the completion accounts for the Enterprise sale, an aggregate amount of $1,559,485 became payable by Webcentral to the consortium. The parties agreed that, given Webcentral's cash flow position, rather than Webcentral making an immediate payment in full, Webcentral will make monthly payments to the consortium of $259,914 between July 2020 and December 2020 (inclusive) in respect of that amount.
2. Customer Dispute:a summary of the recent developments in relation to the Customer Dispute are summarised in section 5.5. Following both parties settling their respective claim and cross-claim at nil (see section 5.5 above), the trade receivable balance held in respect of the amounts claimed by Webcentral Pty Ltd under the Customer Dispute has been written down to nil. As at 31 December 2019, this balance was $10,006,000. Accordingly, Webcentral's net assets will be reduced by the same amount. Any further adjustments will be reflected in the Webcentral Group's financial statements for the half year ended 30 June 2020 (see section 5.8).
3. Goodwill impairment assessment:as is customary and in accordance with Australian Accounting Standards, Webcentral is in the process of reviewing its net asset position in light of factors including the implied value of the business resulting from the Scheme and other events (including the escalation and continuation of the COVID-19 pandemic) occurring since the date of Webcentral's 2019 annual report. Any adjustments required to the carrying value of goodwill will be reflected in Webcentral's audited financial statements for the half year ended 30 June 2020 (see section 5.8).
4. Cost reduction initiatives:subsequent to the sale of the Enterprise division, and to mitigate the impact of the COVID-19 pandemic, Webcentral continued to reduce its cost base across people, marketing, property and systems. This process resulted in a number of roles being made redundant to consolidate the

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organisation and simplify the operational structure, and included the removal of a number of senior and mid-level management roles to reduce overhead costs.

1. Impact ofCOVID-19:in light of the uncertainty created by the COVID-19 pandemic, Webcentral announced the withdrawal of its FY20 guidance on 15 April 2020. As noted in that announcement, since the onset of the COVID-19 outbreak and resulting market conditions, the business observed a reduction in small business spend away from digital marketing and online business promotion. In response, Webcentral executed certain initiatives to maximise cash preservation, including deferrals of tax payments and negotiating with its landlords for rent deferrals. Additionally, certain Webcentral Subsidiaries applied for and received amounts related to the Federal Government's JobKeeper payment scheme. However, there can be no certainty that Webcentral will be eligible for, and receive, future forms of Federal or State Government support.

5.8 Financial information for the half year ended 30 June 2020

As at the Last Practicable Date, Webcentral's reviewed financial statements for the half year ended 30 June 2020 were not available. However, as announced in Webcentral's announcement on 14 August 2020, Webcentral currently expects the following results for the half year ended 30 June 2020:

• SMB Core operating revenue in the range of $29.0 million to $30.0 million (decline of 13% to 15% from p.c.p23);
• SMB Core Underlying EBITDA24(before corporate and unallocated costs) in the range of $3.5 million to $4.5 million (decline of 18% to 22% from p.c.p);
• SMB Core Underlying EBITDA (after corporate and unallocated costs) in the range of $0.2 million to $0.6 million (decline of 80% to 90% from p.c.p);
• Net Cash Outflow from Operating Activities of $9 million to $10 million due to expenditure on working capital payments required upon sale of the Enterprise division, interest and bank fees, and costs associated with delivering the cost out program. In addition, there are material cash outflows related to investing activities being advisor fees associated with the strategic review process; and
• Group Statutory Loss After Tax being incurred after adjusting for the final loss on disposal of the former Enterprise division, subject to any further adjustments arising from the completion of the Webcentral Group's review of the carrying value of goodwill to reflect factors including the value of the business implied by the Scheme Consideration and the impacts of theCOVID-19 pandemic.

The above results are preliminary and include the impact of AASB 16 Leases. Webcentral's statutory H1 2020 results are subject to finalisation following the completion of the independent auditor's review and the Webcentral Board's review and approval of Webcentral Group's H1 2020 financial statements. The final results could differ from these preliminary results.

These numbers should not be taken as guidance, or relied upon in any other way, in respect of the expected performance of Webcentral during H2 2020. In particular, the challenges that arose midway through H1 2020 as a result of the COVID-19 pandemic continue to affect Webcentral's business and to reduce its cash receipts to a far greater

1. Prior comparative period (p.c.p), being the half year ended 30 June 2019.
2. Underlying EBITDA is derived after adjusting fornon-recurring and unusual items affecting comparability between financial periods, such as costs associated with the sale of business units, restructuring costs etc. The Webcentral Group believes this unaudited non-IFRS information is relevant to the user's understanding of the Webcentral Group's underlying performance.

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5 Information about Webcentral and the Webcentral Group CONT.

extent than its costs. Webcentral continues to observe a sustained reduction in small business spend away from digital marketing and online business promotion. These impacts are expected to continue throughout H2 2020, and the uncertainty of the situation means no reliable forecast can be provided at this time. Accordingly, H1 2020 earnings should be not utilised as a proxy by Webcentral Shareholders for H2 2020 earnings, and it is likely that the performance in the second half of the year will be worse than that in H1 2020.

Webcentral currently expects to release to the ASX its reviewed financial statements for the half year ended 30 June 2020 in late August 2020.

Following the release of these financial statements, the Webcentral Board will obtain the Independent Expert's confirmation of whether the financial results change the Independent Expert's opinion that the Scheme is fair and reasonable and, therefore, is in the best interests of Webcentral Shareholders, in the absence of a superior proposal.

This confirmation will be announced to the ASX in advance of the Scheme Meeting. If the Independent Expert's opinion has changed, the matter will be relisted before the Court prior to the Scheme Meeting. Webcentral Shareholders are encouraged to read those financial statements (and the confirmation of whether the Independent Expert's opinion changes) before deciding how to vote on the Scheme at the Scheme Meeting.

Please refer to the Independent Expert's Report contained in Annexure 1 for further financial information in relation to Webcentral.

5.9 Financial year outlook for 2020

On 15 April 2020, Webcentral released an announcement to the ASX withdrawing its previously announced guidance that it expected to achieve EBITDA of $11 million to $12 million for the year 2020 as a result of the impact and anticipated significant further impact of COVID-19. Webcentral noted that although its core business through to the end of the first quarter was on track to meet the guidance range for 2020, in the second half of March the impact of changed market conditions as result of the COVID-19 pandemic became apparent, and Webcentral had observed a reduction in small business spend away from digital marketing and online business promotion. Given the escalation of COVID-19 and the associated uncertainty, Webcentral determined that it was appropriate to withdraw its earlier guidance.

5.10 Risks relating to Webcentral's business

There are existing risks relating to the Webcentral business, which will continue to be relevant to Webcentral Shareholders if the Scheme does not become Effective. A summary of the key risks relating to Webcentral's business and an investment in Webcentral is set out in section 7 of this Scheme Booklet.

5.11 Recent share price performance

Webcentral Shares are listed on the ASX under the trading symbol "WCG". Until 26 June 2020, Webcentral Shares were listed on the ASX under the trading symbol "ARQ".

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The chart below shows Webcentral's Share price performance over the 12 months before the Announcement Date.

The current price of Webcentral Shares on the ASX (ASX:WCG) can be obtained from the Webcentral website (www.webcentralgroup.com.au) or the ASX website (www.asx.com.au). The closing price for Webcentral Shares on the ASX on the Last Practicable Date was $0.105.

In the S&P/ASX rebalance announcement dated 12 June 2020, it was announced that Webcentral would be removed from the All Ordinaries index effective at the open of trading on 22 June 2020.

5.12 Publicly available information about Webcentral

As an ASX listed company and a "disclosing entity" under the Corporations Act, Webcentral is subject to regular reporting and disclosure obligations. Among other things, these obligations require Webcentral to announce price sensitive information to the ASX as soon as Webcentral becomes aware of that information, subject to some exceptions.

Pursuant to the Corporations Act, Webcentral is required to prepare and lodge with ASIC and the ASX both yearly and half-yearly financial statements accompanied by a statement and report from the Webcentral Directors and an audit or review report respectively.

Copies of each of these documents can be can be found in the Investor Centre section of the Webcentral website (www.webcentralgroup.com.au) or the ASX website (www.asx.com.au). Copies of the documents lodged with ASIC in relation to Webcentral may be obtained from ASIC.

The below table contains announcements released by Webcentral to the ASX from 30 March 2020 (being the date on which Webcentral lodged its annual report for 2019 with the ASX) until the Last Practicable Date. This table does not contain announcements released to the ASX relating to substantial holder notices.

Announcement		Date of announcement
Withdrawal of Guidance, Trading Update and Implementation	15 April 2020
of amplified cost reduction initiatives

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Announcement		Date of announcement
AGM Notice of Meeting, Proxy Form, Annual Report	24	April 2020
Corporate Governance Statement & Appendix 4G	24	April 2020
Update on AGM Arrangements	8 May 2020
ARQ FY19 AGM - Webcast Details	25 May 2020
AGM 2020 Chairman and CEO Presentation	28 May 2020
Results of Annual General Meeting	28	May 2020
Arq Group rebranded to Webcentral Group	26	June 2020
Recommended scheme of arrangement to acquire	13	July 2020
Webcentral
Resignation and appointment of Company Secretary	20	July 2020
Keybridge activity and recommended Web.com scheme	3 August 2020
Change of Director's Interest Notice - L Bloch	4 August 2020
Response to ASX Appendix 3Y Query	10 August 2020
Market update on H1 2020 financial results and scheme of	14	August 2020
arrangement
Director resignation and Appendix 3Z - L Bloch	17	August 2020
Update on scheme of arrangement - Settlement of Customer	20	August 2020
Dispute

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6 INFORMATION ABOUT WEB.COM AND THE WEB.COM GROUP

6.1 Introduction

The information contained in this section 6 has been prepared by Web.com. The information concerning Web.com and the Web.com Group and the intentions, views and opinions contained in this section 6 are the responsibility of Web.com. Neither Webcentral nor any of its Subsidiaries, nor any director, officer, employee or adviser of any of them assumes any responsibility for the accuracy or completeness of the information in this section 6.

6.2 Overview of Web.com

1. Corporate overview and principal operations
   Web.com is a company established in Delaware in the United States of America.
   Web.com provides a range of web registration, hosting and associated services to businesses of all sizes to help them compete and succeed online through its portfolio of brands - Web.com, Network Solutions, Register.com, CrazyDomains, Sitebeat and Vodien. Web.com's services are designed to meet the needs of businesses anywhere along their lifecycle with affordable, subscription-based solutions including domains, hosting, email, security, website design and management, internet marketing solutions and other value- added online services.
   Headquartered in Jacksonville, Florida, Web.com has operations in North America, South America, the UK, Australia and South East Asia.
   Up until the end of 2019, Web.com operated almost entirely within the United States. However, in October 2019, Web.com acquired Dreamscape Networks Limited (Dreamscape) allowing Web.com to expand into Australia, New Zealand and South East Asia. Established in 2000, Dreamscape is an online solutions provider that enables businesses and consumers to find, establish and grow their online presence via its CrazyDomains, Vodien and Sitebeat brands. Dreamscape is headquartered in Singapore.
   Web.com is indirectly owned by the Siris Capital Funds (and five investors that indirectly own less than 5% of Web.com on a fully diluted basis). The Siris Capital Funds are managed and/or advised by Siris Capital Group, LLC and its affiliates (see section 6.3(c) below).
2. Directors and executive management
   The Web.com Board as at the date of this Scheme Booklet is comprised of the following members:

1. Non-ExecutiveDirectors: Bob Aquilina, Executive Chairman

Mr Aquilina was a senior operating executive of AT&T, Inc. with a 21-year career. His last post at AT&T was as Co-President of AT&T Consumer Services and a member of the Chairman's Operating Group. Previously within AT&T, Mr Aquilina held a variety of senior positions including President of Europe, Middle East & Africa; Vice Chairman of AT&T Unisource; Vice Chairman of WorldPartners; Chairman of AT&T UK; and General Manager of Global Data Services. He was previously a member of the Board of Directors of Japan Telecom, Inc. and the Co- Chairman of Flag Telecom Group Ltd. Mr Aquilina

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6 Information about Web.com and the Web.com Group CONT.

served as the Executive Chairman of MedQuist and Applied Discovery. In addition to his responsibilities with Web.com, Mr Aquilina is currently the Executive Chairman of TNS and a board member ofTPx Communications, PGi, and Synchronoss Technologies.

Frank Baker

Mr Baker is a Co-Founder and Managing Partner of Siris Capital and is a board member of all Siris portfolio companies. Mr Baker started his career in the Mergers and Acquisitions group of Goldman Sachs and has an M.B.A. from Harvard Business School and a B.A. from the University of Chicago. Mr Baker also serves as a trustee of the University of Chicago.

Peter Berger

Mr Berger is a Co-Founder and Managing Partner of Siris Capital and is a board member of all Siris portfolio companies. Mr Berger started his career at Arthur Andersen where he was global head of the Corporate Finance Group and was a Managing Director of Bear Stearns Companies. Mr Berger was also a founding member of the private equity firm Ripplewood Holdings LLC. He has an M.B.A. from Columbia University Graduate School of Business and a B.Sc. from Boston University.

Jeff Hendren

Mr Hendren is a Co-Founder and Managing Partner of Siris Capital and is a board member of all Siris portfolio companies. Mr Hendren started his career at Georgia Pacific and was a member of the Mergers and Acquisitions group of Goldman Sachs. He has an M.B.A. from Harvard Business School and a B.Sc. from Indiana University.

Tyler Sipprelle

Mr Sipprelle joined Siris Capital in 2016. Prior to Siris, Mr Sipprelle worked at Vector Capital and in the Technology Investment Banking Group at Lazard. Mr Sipprelle received his M.B.A. from Harvard Business School, where he was a Baker Scholar, and holds a bachelor's degree in Economics cum laude from Harvard University. He serves as a director of Web.com, Electronics for Imaging and Transaction Network Services and formerly served as a director of Intralinks.

Tim Kelly

Tim Kelly is an independent director at Web.com. Having held the roles of President and CEO at Network Solutions, President of Sprint's Consumer Division and Chief Marketing Officer, Mr Kelly has had extensive leadership experience at consumer- and SMB- focused businesses. He currently serves as a director of Web.com, Roadz, and Moovila. He has an M.B.A. from Nova Southeastern and holds a bachelor's degree in Marketing from the University of Florida.

1. Executives:

The executive management team of Web.com as at the date of this Scheme Booklet is:

Sharon Rowlands, Chief Executive Officer, President, and Director

Ms Rowlands brings deep industry knowledge and a strong track record of leading multibillion-dollarhigh-tech companies that serve small- and medium- sized businesses, financial markets and enterprise customers. Prior to joining Web.com in January 2019, she served as CEO of ReachLocal, a public digital marketing company, leading it through a strategic transformation and the 2016

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sale to Gannett. At Gannett, Ms Rowlands served as president of the USA Today Network Marketing Solutions business while continuing to serve as CEO of ReachLocal. Prior CEO positions include Penton Media, Altegrity, and Thomson Financial. Additionally, Ms Rowlands serves on the board of directors for Pegasystems, a global software company, and Everbridge, a critical event management and enterprise safety applications company. Among several prestigious accomplishments, she was named Customer Focused CEO of the Year in the 2016 CEO World Awards, won the Gold Stevie Award for Female Executive of the Year in 2016, and was also named Female CEO of the Year in the 2016 One Planet Awards. Ms Rowlands received her Postgraduate Certificate in education from the University of London and her BA in history from the University of Newcastle, Newcastle-Upon-Tyne.

Christina Clohecy, Chief Financial Officer

Ms Clohecy brings more than 20 years of financial experience and is responsible for Web.com's financial strategy and finance operations. Most recently, she held leadership positions with Siris Capital portfolio companies Stratus Technologies, Inc., which she joined in 2016 as CFO, and Airvana. Previously, she held a series of positions at both Sycamore Networks Inc. and Vitronics Soltec. Ms Clohecy has an MBA from Babson College and a BS in business from Southern New Hampshire University.

Michael Bouchet, Chief Information Officer

Mark Evans, Chief Executive Officer, Dreamscape Networks

Deb Myers, Chief People Officer

Chris Ortbals, Chief Product Officer

Ted Schremp, Chief Marketing Officer

Rob Solomon, Chief Customer Officer

Further information about the executive management team is available on Web.com's website (https://www.web.com/content/web/en/about-us/executive-management).

6.3 Overview of Web.com Sub

1. Ownership structure
   Web.com Aus Bidco Pty Ltd (ACN 635 836 298) (Web.com Sub) was incorporated on 28 August 2019 for the purpose of acquiring Dreamscape and continues to own all of the shares in Dreamscape. All of the shares in Web.com Sub are owned by Web.com HoldCo. It is proposed that Web.com Sub will acquire all the Webcentral Shares under the Scheme.
   Web.Com Aus Holdco Pty Ltd (ACN 635 831 597) (Web.com HoldCo) is a special purpose company that was incorporated on 28 August 2019 for the purpose of holding all of the shares in Web.com Sub and continues to own all of the shares in Web.com Sub. All of the shares in Web.com HoldCo are owned by Web.com Dreamscape Singapore.
   Web.com Dreamscape Pte. Ltd. (Web.com Dreamscape Singapore) is a special purpose company that was incorporated on 26 August 2019 for the purpose of holding all of the shares in Web.com HoldCo and continues to own all of the shares in Web.com HoldCo. All of the shares in Web.com Dreamscape Singapore are owned by Web.com.
   Web.com Group, Inc. (Web.com) is indirectly owned by the Siris Capital Funds (and five investors that indirectly own less than 5% of Web.com on a fully

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47

6 Information about Web.com and the Web.com Group CONT.

diluted basis). The Siris Capital Funds are managed and/or advised by Siris Capital Group, LLC and its affiliates.

The ownership structure of Web.com Sub described above is detailed below.

1. 'Siris Capital Funds' comprises multiple investment vehicles (as detailed in the definition of Siris Capital Funds in section 10). The Siris Capital Funds, together with five investors that indirectly own less than 5% of Web.com on a fully diluted basis, indirectly own all of the shares in Web.com.

2. The Siris Capital Funds (and five investors that indirectly own less than 5% of Web.com on a fully diluted basis) indirectly own all of the shares in Web.com, that is, there are certain intervening entities through which the Siris Capital Funds and five investors (mentioned above) own all of the shares in Web.com.

1. Directors
   As at the date of this Scheme Booklet, the directors of Web.com Sub and Web.com HoldCo are Christina Clohecy and Evan Cross.
2. Siris Capital
   Siris Capital is a private equity firm based in the United States of America. Investment funds affiliated with Siris Capital have raised more than US$5.9 billion of cumulative capital since its inception in 2011.
   Further information about Siris Capital can be found at https://siris.com/.

6.4 Rationale for proposed acquisition of Webcentral

The acquisition of Webcentral will build upon Web.com's existing business in Australian and New Zealand (which it acquired through the acquisition of Dreamscape in 2019) and is part of Web.com's strategy to expand its business outside of the United States. The proposed acquisition signals Web.com's continued commitment to providing web presence solutions to customers around the globe.

The acquisition will add brands and operations in Australia and New Zealand to its existing portfolio, which will allow the combined entity to compete more effectively in the highly competitive markets in which the parties operate in Australia and New Zealand. The combination of Web.com and Webcentral is expected to benefit both entities, as the

48 Webcentral Group Limited | Scheme Booklet

Transaction will recapitalise Webcentral and the increased size of the group's operations is expected to drive efficiencies and economies.

6.5 Funding arrangements

The Scheme Consideration will be provided wholly in cash.

Under the Deed Poll and conditional upon the Scheme becoming Effective, Web.com and Web.com Sub have each undertaken in favour of each Scheme Shareholder to deposit (or procure the deposit of) the aggregate amount of the Scheme Consideration into a trust account operated for the benefit of the Scheme Shareholders by no later than the Business Day before the Implementation Date.

The aggregate Scheme Consideration payable by Web.com under the Scheme will be approximately A$12.2 million assuming there are 122,131,124 Scheme Shares on issue on the Implementation Date.

Web.com has also agreed that, upon implementation of the Scheme, Web.com will refinance the Existing Debt Facilities and ensure the full and final payment or repayment to the Existing Financiers of all amounts payable to them under the Existing Debt Facilities, in accordance with the Scheme Implementation Deed.

Web.com Sub intends to fund the Scheme Consideration and the amounts payable to the Existing Financiers under the Existing Debt Facilities using the Web.com Group's cash reserves and existing credit facilities.

As at 30 June 2020, the Web.com Group has available cash reserves of approximately US$26 million, or approximately A$37.9 million25. In addition, the Web.com Group has available undrawn borrowing capacity of approximately US$92.4 million under its existing revolving credit facility, or approximately A$134.6 million26. This amount exceeds the maximum aggregate Scheme Consideration payable by Web.com Sub under the Scheme and the expected aggregate amount payable to the Existing Financiers under the Existing Debt Facilities.

The aforementioned credit facilities are subject to conditions precedent to drawdown which are customary for facilities of this nature. As at the date of this Scheme Booklet, Web.com is not aware of any reason why the credit facilities will not be available to be drawn down for the purposes of the acquisition of Webcentral Shares and repayment of the Existing Debt Facilities on or prior to the Implementation Date.

The Scheme is not subject to a financing condition.

6.6 Intentions if the Scheme is implemented

Set out below are the present intentions of Web.com, if the Scheme is implemented, in relation to the continuation of Webcentral's business, any major changes to the Webcentral's business, the future employment of the present employees of Webcentral, any redeployment of the fixed assets of Webcentral and the delisting of Webcentral from the ASX.

These statements of intention are based on information concerning Webcentral, its business and the general business environment that are known to Web.com as at the date of this Scheme Booklet.

Web.com does not currently have full knowledge of all material information, facts and circumstances that are necessary to assess the operational, commercial, tax and financial implications of its current intentions. Decisions regarding these matters will only

1. Based on an exchange rate of 1.457 Australian Dollars to 1 US$ as at 30 June 2020.
2. Based on an exchange rate of 1.457 Australian Dollars to 1 US$ as at 30 June 2020.

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6 Information about Web.com and the Web.com Group CONT.

be made by Web.com in light of all material information and circumstances at the relevant time.

Accordingly, the statements set out in this section 6.6 are statements of current intention only, which may change as new information becomes available to Web.com or as circumstances change.

1. Business, operations and assets
   Web.com's current intention is to continue the current strategic direction of Webcentral, including actively pursuing growth opportunities available to Webcentral, subject to its consideration of the information and circumstances at the relevant time post-acquisition. Web.com does not currently intend to redeploy any of Webcentral's fixed assets.
2. Webcentral board
   If the Scheme is implemented, the Webcentral Board and the board of directors of each of its subsidiaries will be reconstituted with effect on and from the Implementation Date. At the date of this Scheme Booklet, the new directors have not been determined.
3. Employees
   Following implementation of the Scheme, Web.com will evaluate Webcentral's business operations and organisational structure as part of its integration planning to ensure Webcentral, once integrated into the Web.com Group, has the appropriate mix and level of employees and skills to enhance the business going forward.
   Web.com's Australian subsidiary Dreamscape Networks Limited currently maintains a significant Australian presence in terms of office and technical staff located in Sydney along with major data centres located in both Perth and Sydney. Web.com currently intends to significantly expand and scale-up its physical Australian footprint in order to provide premium online solutions and services for the Webcentral Group's additional customers. Web.com currently intends to combine the offices and human resources of Dreamscape and Webcentral in the technical, marketing and digital services areas as it plans for improved focus on its core Australian market.
4. Delisting
   If the Scheme is implemented, Web.com currently intends to procure that Webcentral applies to the ASX to be removed from the official list of ASX after implementation of the Scheme.

6.7 Web.com's interest in Webcentral Shares

1. Interest in Webcentral Shares
   At the date of this Scheme Booklet, none of Web.com or any of its Associates has a Relevant Interest in any Webcentral Shares or any Voting Power in Webcentral.
2. Dealing in Webcentral Shares
   At the date of this Scheme Booklet, none of Web.com or any of its Associates have provided, or agreed to provide, consideration for Webcentral Shares under any purchase or agreement during the four months before the date of this Scheme Booklet.

50 Webcentral Group Limited | Scheme Booklet

1. Benefits to holders of Webcentral Shares
   During the four months before the date of this Scheme Booklet, none of Web.com or any of its associates has given or offered to give or agreed to give benefit to another person where the benefit was likely to induce the other person or associate to:
2. 1. vote in favour of the Scheme; or
   2. dispose of Webcentral Shares,

where the benefit was not offered to all Webcentral Shareholders.

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51

7 RISK FACTORS

7.1 Introduction

In considering the Scheme, Webcentral Shareholders should be aware that there are a number of risk factors, both general and specifically relating to Webcentral and the Webcentral Group, which may adversely affect the future operating and financial performance of Webcentral and the price and/or value of Webcentral Shares.

This section 7 outlines:

• general risk factors (refer to section 7.2);
• specific risks relating to the business and operations of Webcentral (refer to section 7.3); and
• risks relating to the Scheme (refer to section 7.4).

While measures can be taken to mitigate some of these risks, these risks remain either wholly or partially outside the control of Webcentral, the Webcentral Group and the Webcentral Directors. In deciding whether to vote in favour of the Scheme, Webcentral Shareholders should read this Scheme Booklet carefully and consider these risks.

If the Scheme proceeds, Webcentral Shareholders will receive the Scheme Consideration, will cease to hold Webcentral Shares and will no longer be exposed to the risks set out in this section 7 (and other risks to which Webcentral and the Webcentral Group may be exposed). If the Scheme does not proceed, Webcentral Shareholders will continue to hold Webcentral Shares and continue to be exposed to risks associated with investment in Webcentral.

The risks set out in this section 7 do not take into account the individual investment objectives, financial situation, position or particular needs of Webcentral Shareholders.

In addition, these risks are general in nature only and do not cover every risk that may be associated with an investment in Webcentral now or in the future. There may also be additional risks and uncertainties not currently known to Webcentral which may have a material adverse effect on Webcentral's operating and financial performance and the value of Webcentral Shares.

7.2 General risk factors

Webcentral and the Webcentral Group are exposed to a number of general risks that could materially adversely affect their assets and liabilities, financial position, profits, prospects and potential to make further distributions to Webcentral Shareholders, and the price and/or value of Webcentral Shares. General risks that may impact on Webcentral, the Webcentral Group or the market for Webcentral Shares include:

• changes in general business, industry cycles and economic conditions including inflation, interest rates, exchange rates, commodity prices, employment rates and consumer demand;
• changes to government policy, legislation or regulation, both domestic and global, which may restrict or otherwise impact the business operations and activities of Webcentral and the Webcentral Group;
• the nature of competition in which Webcentral and the Webcentral Group operate;
• natural disasters, catastrophes and disease or pandemic (including the outbreak, escalation or impact of, and recovery from, theCOVID-19 pandemic) and other macroeconomic occurrences, including but not limited to geopolitical

52 Webcentral Group Limited | Scheme Booklet

events such as an outbreak of hostilities, acts of terrorism and declarations of war;

• variations in the operating results of Webcentral and the Webcentral Group;
• cash flow and liquidity risks;
• inclusion or removal from major market indices;
• variations in recommendations by securities analysts and brokers;
• changes in investor sentiment and perceptions, market fluctuations and overall performance of the Australian and international stock markets;
• the operating and trading price performance of other comparable listed entities;
• changes to accounting standards and reporting standards;
• changes to the current tax regime;
• claims, litigation, industry complaints, regulatory investigations and other disputes, which may be with or without merit, giving rise to, among other things, costs of defending and resolving such disputes, heightened public scrutiny and potential reputational harm;
• strategic, contractual and partnerships risks, including but not limited to the potential loss,non-renewal or renewal on less favourable terms of contracts or partnership agreements with third parties; and
• other risks and uncertainties which may not currently be known to Webcentral or the Webcentral Group.

Some of these factors could affect Webcentral's share price regardless of Webcentral's underlying operating performance.

7.3 Specific risks relating to the business and operations of Webcentral

Key business risks and associated mitigants are summarised in no order of significance as follows:

Risk	Potential impacts	Mitigation

BusinessThe Webcentral Group disposed of its

structureEnterprise business division in March 2020, and of its TPP Wholesale Reseller business in July 2019.

Transitional services continue to be provided between the Webcentral Group and both of those businesses.

There is a risk that the Webcentral Group may encounter unexpected challenges in managing the separation of these businesses from its continuing operations, including potential delays, higher than anticipated costs, disruptions to continuing operations, unanticipated difficulties in separating technology, IT and business functions, and other unforeseen issues or disruptions.

The Webcentral Group is currently managing the smooth transition of the Enterprise business following its divestment, ensuring the key service deliverables in the transitional services agreement entered into in connection with the sale are met whilst minimising impact to customers.

The transitional services agreement entered into in connection with the sale of the TPP Wholesale Reseller business continues to be in force and governs, among other things, the Webcentral Group's ongoing receipt of service fees associated with the separation of the business.

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7 Risk factors CONT.

Risk	Potential impacts	Mitigation

FinancialThe Webcentral Group is largely dependent

riskon funding provided by the Existing Financiers.

Section 5.4 for further information.

The Webcentral Group is currently working with the Existing Financiers to manage the Existing Debt Facilities and ensuring the Webcentral Group has sufficient working capital and liquidity to be able to continue as a going concern.

Section 5.4 for further information.

RefinancingSee section 5.4.	See section 5.4.
risks

CompetitionThe online business world is rapidly evolving with a heightened environment of change characterised by disruptive technologies. The Webcentral Group therefore faces potential loss of its competitive or market position as a result of potential product innovation by existing competitors or new entrants to the market. Webcentral may not anticipate or respond to any such developments with sufficient speed to maintain its market position.

Other competitive risks faced by Webcentral include price competition, competitor marketing campaigns, mergers of, or acquisitions by, competitors and possible new entrants to the market.

The Webcentral Group remains abreast of the competitive landscape by investing in new products and customer experience.

The acquisitions of Netregistry, Uber Global and WME Group assist in risk mitigation with access to a larger customer pool, increased skill sets, funds available for market investment and product enhancements.

TechnologyThe digital services industry is evolving and changerapidly with the frequent introduction of new

technologies, products and innovations. Consumer behaviours, preferences and trends are also constantly changing upon the onset of new methods of communication and digital platforms. The Webcentral Group must likewise evolve and adapt its products and service offering to maintain pace with the industry in which it operates and to maintain its competitive position.

Given the pace of change, there is no guarantee that the Webcentral Group will be able to continue to introduce new and superior products, or products that are perceived to be new and superior by consumers, at the rate seen by other competitors in the market generally. The Webcentral Group's ability to do so is constrained by factors including its available capacity, resources and capital to invest in product develop, innovation and design. This may adversely impact on the Webcentral

Webcentral has historically invested in acquiring businesses, such as WME, Netregistry and Uber Global, which have improved its product offering to customers and introduced product enhancements.

Webcentral continues to invest in capability improvements, smart technology and new products. The Webcentral Group's focus on customer service and experience and operational excellence aims to build customer loyalty to mitigate the potential effects of any delays in product innovation. The recent divestments of TPP Wholesale and the Enterprise division have also enabled Webcentral to renew its focus on its core products and services.

54 Webcentral Group Limited | Scheme Booklet

Risk	Potential impacts	Mitigation
	Group's long and short term business
	performance.

Cyber and	As a technology business, Webcentral's
security	business may be particularly adversely
risks	affected by technological disruptions,
	including through impacts of malicious third
	party applications that could interfere with its
	products and platforms.
	It is possible that the measures taken by
	Webcentral will not prevent unauthorised
	access to its systems and technologies,
	risking third party access to confidential or
	otherwise sensitive data. This could lead to
	loss of key business or customer
	information, reputational damage and claims
	from customers or other third parties whose
	data may be affected.
	A cyber-attack on the Webcentral Group
	could also result in failures and disruptions
	to its systems and products. Any resulting
	inability of the Webcentral Group to provide
	its services to customers could lead to
	reputational damage, loss of market share
	and claims for compensation from
	customers.

The Webcentral Group creates and maintains regular back-ups of critical data, minimising the risk of data loss in the event of a cyber-attack. The Webcentral Group also uses various systems, software and tools to detect and prevent viruses and other malicious third party technologies designed to permit unauthorised access or damage to its technology systems, or to destroy or corrupt its data.

IntellectualWebcentral holds various intellectual

propertyproperty, trademarks and other rights which are inherently at risk of infringement by third parties. Failure by Webcentral to protect these rights could impact the value of these rights, the Webcentral Group's ability to maintain customer recognition and the risk of confusion between Webcentral and third parties.

Webcentral's procedures include registering intellectual property and other rights when possible, creating contractual protections where possible and monitoring for potential infringements by third parties.

Markets	A material proportion of registration revenue
	is derived from the performance of the
	Webcentral Group's reseller channel. These
	revenue streams can be difficult to predict.

The Webcentral Group works closely with its customers to understand their challenges in order to mitigate this risk.

RegulatoryThe Webcentral Group operates in highly regulated global markets. Success can be impacted by changes to the regulatory environment.

The Webcentral Group plays an active role in consulting with regulators on changes which could impact its business.

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7 Risk factors CONT.

Risk	Potential impacts	Mitigation

EmployeeRecruiting and retaining talent is a key

retentionchallenge for all technology companies in

andorder to drive growth in a highly competitive

turnoverenvironment.

Employee turnover may occur as a result of various factors including the Webcentral Group's business performance, recruitment and training practices, salary pressures, career advancement opportunities, workplace culture, the Webcentral Group's ability to retain existing employees and attract new talent, and the state of the employment market generally.

Poor employee retention rates may impact, among other things, the Webcentral Group's ability to retain expertise, industry knowledge and specialist skills within the business.

The Webcentral Group is committed to achieving and maintaining strong employee retention by focusing on positive employee engagement, prioritising active training and development, providing clear paths of career advancement and fostering a culture of openness and transparency.

Risks associated with the COVID-19 pandemic

The Webcentral Group is exposed to general economic risks posed by the ongoing COVID-19 outbreak.

As noted in section 5.7, there was some impact of changed market conditions as a result of COVID-19 in the second half of March, and Webcentral has observed a small business spend away from digital marketing and online business promotion. The ongoing impact of COVID-19 may result in sustained closures or a decline in business activity of Webcentral's customers, which would likely impact the financial performance of Webcentral. Furthermore, the effects of ongoing measures introduced by State and Federal governments to limit transmission of COVID-19 (including the forced closures of business, overseas and domestic travel bans and quarantine requirements) will likely have a material negative impact on Australia's overall macro-economic environment to which Webcentral is exposed.

While future revenues of Webcentral may be negatively impacted, at this time the Webcentral Group is unable to estimate the exact scope and any financial impact the COVID-19 may have on the Webcentral Group's operations in the future.

The Webcentral Group is currently monitoring the impact of COVID-19. To date, it has executed its business continuity framework and implemented crisis management tools to mitigate the impacts of COVID-19 on its business operations to a sufficiently acceptable level.

Webcentral has identified further cost reduction and cash preservation strategies in the event that revenues of Webcentral are materially negatively impacted.

56 Webcentral Group Limited | Scheme Booklet

The Webcentral Group takes a proactive approach to risk management and an active risk management plan is in place. The Webcentral Group's approach to risk management is to determine the material areas of risk it is exposed to in running the organisation and to put in place plans to manage and/or mitigate those risks.

In addition, risk areas are reviewed by the Webcentral Group's risk management staff, with the assistance of external advisers on specific matters, where appropriate. Internal audit of key business processes is scheduled across the Webcentral Group. The entire risk management plan is reviewed at least annually.

7.4 Risks relating to the Scheme

The implementation of the Scheme is subject to certain Conditions Precedents, which are summarised in section 9.4(c) of this Scheme Booklet and are set out in full in clause 3.1 of the Scheme Implementation Deed.

Webcentral will only apply to the Court for orders approving the Scheme if each of the Condition Precedents (except Court approval of the Scheme) is satisfied or waived (if capable of waiver) prior to 8.00am (Sydney time) on the Second Court Date. As such, a failure to satisfy or waive, or a delay in satisfying or waiving, any of the Conditions Precedent may delay or prevent implementation of the Scheme.

There is also the risk that the Court may not approve the Scheme, or may only be willing to approve the Scheme subject to conditions that Webcentral and/or Web.com (as applicable) are not prepared to accept. There is also a risk that some or all of the aspects of the Webcentral Shareholder and Court approvals required for the Scheme to proceed may be delayed.

If the Scheme is implemented, Webcentral Shareholders will cease to hold Webcentral Shares and will forgo any benefits that may result from being a Webcentral Shareholder.

This will mean that Webcentral Shareholders will not participate in the future performance of Webcentral or retain any exposure to Webcentral's business or assets or have the potential to share in the value that could be generated by Webcentral in the future. However, there is no guarantee as to Webcentral's future performance, as is the case with all investments.

Webcentral Shareholders may also consider that it would be difficult to identify or invest in alternative investments that have a similar investment profile to that of Webcentral, or may incur transaction costs in undertaking any new investment.

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57

8 TAX ADVISER'S LETTER

The Directors	21 August 2020
Webcentral Group Limited
Level 23
680 George Street
Sydney NSW 2000

Dear Directors

Webcentral Group Limited

Australian tax consequences of scheme of arrangement

We have been instructed by Webcentral Group Limited (Webcentral) to prepare this letter for inclusion in section 8 of the Scheme Booklet.

Capitalised terms not otherwise defined in this letter have the meaning given to them in the Scheme Booklet. This letter uses the section numbering of the Scheme Booklet.

1 General

1.1 Introduction

The following is a general description of the Australian tax consequences of the Scheme (assuming it becomes Effective) for Webcentral Shareholders. It does not constitute tax advice and should not be relied upon as such. The comments set out below are relevant only to those Webcentral Shareholders who hold their Webcentral Shares on capital account.

The description is based upon the Australian law and administrative practice in effect at the date of this Scheme Booklet, but is general in nature and is not intended to be an authoritative or complete statement of the laws applicable to the particular circumstances of a Webcentral Shareholder. Webcentral Shareholders should seek independent professional advice in relation to their own particular circumstances.

The description does not address the Australian tax consequences for Webcentral Shareholders who:

• hold their Webcentral Shares for the purposes of speculation or a business of dealing in securities (e.g. as trading stock);
• acquired their Webcentral Shares pursuant to an employee share, option or rights plan; or
• are subject to the taxation of financial arrangements rules in Division 230 ofIncome Tax Assessment Act 1997(Cth) in relation to gains and losses on their Webcentral Shares.

Webcentral Shareholders who are tax residents of a country other than Australia (whether or not they are also residents, or are temporary residents, of Australia for tax

ANZ Tower 161 Castlereagh Street Sydney NSW 2000 Australia	T [phone] F [phone]
GPO Box 4982 Sydney NSW 2001 Australia	DX 361 Sydney www.greenwoods.com.au
Liability limited by a scheme approved under Professional Standards Legislation	Greenwoods & Herbert Smith Freehills Pty Limited ABN 60 003 146 852

58 Webcentral Group Limited | Scheme Booklet

purposes) should take into account the tax consequences of the Scheme under the laws of their country of residence, as well as under Australian law.

2 Australian resident shareholders

2.1 Capital gains tax (CGT)

Under the Scheme, Webcentral Shareholders will dispose of their Webcentral Shares to Web.com Sub. This disposal will constitute a CGT event A1 for Australian CGT purposes for Webcentral Shareholders.

The time of the CGT event will be the Implementation Date.

2.2 Calculation of capital gain or capital loss

Webcentral Shareholders may make a capital gain on the disposal of Webcentral Shares to the extent that the capital proceeds from the disposal of the Webcentral Shares are more than the cost base of those Webcentral Shares. Conversely, Webcentral Shareholders will make a capital loss to the extent that the capital proceeds are less than their reduced cost base of those Webcentral Shares.

1. Cost base

The cost base of the Webcentral Shares generally includes the cost of acquisition and certain non-deductible incidental costs of their acquisition and disposal. The reduced cost base of the Webcentral Shares is usually determined in a similar, but not identical, manner.

If the Webcentral Shares were acquired at or before 11.45am on 21 September 1999, a Webcentral Shareholder who is an individual, a complying superannuation entity or the trustee of a trust may choose to adjust the cost base of their Webcentral Shares to include indexation by reference to changes in the consumer price index from the calendar quarter in which their Webcentral Shares were acquired until the quarter ended 30 September 1999. Webcentral Shareholders that are companies will include that indexation adjustment if their Webcentral Shares were acquired at or before 11.45am on 21 September 1999. Indexation adjustments are taken into account only for the purposes of calculating capital gains; they are ignored when calculating capital losses.

1. Capital proceeds

The capital proceeds received in respect of the disposal of each Webcentral Share should be $0.10 per Webcentral Share, being the amount of the Scheme Consideration.

1. Other issues

Individuals, complying superannuation entities or trustees that have held Webcentral Shares for at least 12 months but do not index the cost base of the Webcentral Shares (refer above) may be entitled to discount the amount of the capital gain (after application of capital losses) from the disposal of Webcentral Shares by 50% in the case of individuals and trustees or by 33⅓% for complying superannuation entities. For trustees, the ultimate availability of the discount for beneficiaries of the trust will depend on the particular circumstances of the beneficiaries.

Capital gains (prior to any CGT discount) and capital losses of a taxpayer in an income year are aggregated to determine whether there is a net capital gain. Any net capital gain is included in assessable income and is subject to income tax. Capital losses may not be deducted against other income for income tax purposes, but may be carried forward to offset against future capital gains (subject to satisfaction of loss recoupment tests for certain taxpayers).

Webcentral Group Limited
Australian tax consequences of scheme of arrangement	page 2

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59

8 Tax Adviser's Letter CONT.

3 Non-resident shareholders

For Webcentral Shareholders who are not Australian tax residents, the disposal of their Webcentral Shares should have no CGT consequences if the Webcentral Shares are not "taxable Australian property".

The Webcentral Shares will only be "taxable Australian property" for non-resident

Webcentral Shareholders who:

• hold their Webcentral Shares in carrying on a business at or through a permanent establishment in Australia; or
• are individuals who made an election to disregard a CGT event I1 capital gain or capital loss in respect of their Webcentral Shares when they ceased to be an Australian tax resident.

For other Webcentral Shareholders who are not Australian tax residents, the Webcentral Shares should not be taxable Australian property as their underlying value is not principally derived from Australian real property.

4 Goods and services tax (GST)

Webcentral Shareholders should not be liable to GST in respect of a disposal of those Webcentral Shares.

Webcentral Shareholders may be charged GST on costs (such as advisor fees relating to their participation in the Scheme) that relate to the Scheme. Webcentral Shareholders may be entitled to input tax credits or reduced input tax credits for such costs, but should seek independent advice in relation to their individual circumstances.

*

*

*

*

*

Yours sincerely

Greenwoods & Herbert Smith Freehills Pty Limited

Webcentral Group Limited
Australian tax consequences of scheme of arrangement	page 3

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9 ADDITIONAL INFORMATION

9.1 Interests of Webcentral Directors in Webcentral Shares

As at the Last Practicable Date, the Webcentral Directors have the following Relevant Interests in Webcentral Shares:

Webcentral Director		Number of Webcentral		Voting power
		Shares
Mr Andrew Reitzer	122,500	0.10%
Mr Andrew Macpherson	171,340	0.14%
Mr Karl Siegling(1)	22,873,712	18.73%

1. Included in Mr Karl Siegling's shareholding is 21,230,532 Webcentral Shares attributed to the Cadence Asset Management Entities, in which Mr Karl Siegling has an indirect Relevant Interest.

Mr Larry Bloch, who resigned as a director of Webcentral on 16 August 2020 for personal family reasons, was a Webcentral Director on the Announcement Date. As at the Last Practicable Date, so far as the Webcentral Directors were aware, Mr Larry Bloch has a relevant interest in 6,058,363 Webcentral Shares (conferring voting power of 4.96%). That interest in Webcentral Shares is held through Corpsand Pty Ltd, in which Mr Larry Bloch has a direct Relevant Interest. Mr Larry Bloch is also a director and company secretary of Corpsand Pty Ltd.

Mr Larry Bloch has confirmed to Webcentral that he intends to vote or procure the vote of all the Webcentral Shares in which he has a Relevant Interest at the time of the Scheme Meeting in favour of the Scheme, in the absence of a superior proposal (as determined by Mr Bloch acting reasonably) and subject to the Independent Expert concluding in the Independent Expert's Report (and continuing to conclude) that the Scheme is in the best interests of Webcentral Shareholders.

There are no Performance Rights on issue and none of the Webcentral Directors hold any Performance Rights.

Webcentral Directors who hold Webcentral Shares will be entitled to vote at the Scheme Meeting and, if the Scheme is implemented, receive the Scheme Consideration for their Webcentral Shares, along with the other Scheme Shareholders.

In the absence of a Superior Proposal and subject to the Independent Expert continuing to conclude that the Scheme is in the best interests of Webcentral Shareholders, all Webcentral Directors intend to vote or procure the vote of those Webcentral Shares in which they have a Relevant Interest in favour of the Scheme.

No Webcentral Director acquired or disposed of a Relevant Interest in any Webcentral Shares during the four months before the date of this Scheme Booklet.

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61

9 Additional information CONT.

9.2 Performance Rights

1. No Performance Rights on Issue

Up to and including 2018, Webcentral operated a Long Term Incentive Plan under which Performance Rights were issued each year to the Managing Director and selected employees of the Webcentral Group. In 2019, Webcentral introduced a combined variable reward scheme. As at the date of this Scheme Booklet, Webcentral has no Performance Rights on issue.

This section 9 provides a summary of the long term incentive plan and variable remuneration incentives, under each of which there are no Performance Rights on issue.

1. Long Term Incentive Plan

Up to and including 2018, Webcentral operated a Long Term Incentive Plan under which Performance Rights were issued each year to the Managing Director and selected employees of the Webcentral Group. Each Performance Right entitled the holder to subscribe for one fully paid Webcentral Share. Performance Rights vested at a zero- exercise price upon the satisfaction of certain performance conditions over a 36-month performance period commencing 1 January of the relevant grant year. The vesting date, as determined by the Webcentral Board, typically occurred in the March following the end of the performance period.

Since the performance conditions were unable to be met for the relevant performance periods, all Performance Rights that were outstanding under the Long Term Incentive Plan have since lapsed. In addition, the Long Term Incentive Plan was discontinued for 2019.

Accordingly, Webcentral has no Performance Rights on issue, under the Long Term Incentive Plan or otherwise.

1. Variable remuneration

As noted in section 9.2(a), the Long Term Incentive Plan was discontinued for 2019. As such, there were no Performance Rights issued for 2019.

In place of the Long Term Incentive Plan, Webcentral implemented a combined variable reward scheme consisting of a combination of cash awards and medium term deferred equity awards. Remuneration under the scheme is reviewed annually.

For the 2019 financial year, it was determined that no cash awards or deferred equity awards would be issued as the relevant performance targets had not been achieved.

Accordingly, Webcentral has no Performance Rights on issue, under the combined variable reward scheme or otherwise.

9.3 Other benefits and agreements

1. Interests of Webcentral Directors in Web.com securities

As at the Last Practicable Date, no Webcentral Director had a Relevant Interest in any securities in Web.com.

1. Interests of Webcentral Directors in contracts with the Web.com Group

None of the Webcentral Directors had any interest in any contract entered into by a Web.com Group Member, or any Related Body Corporate of any Web.com Group Member.

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1. Benefits in connection with retirement from office

No payment or other benefit is proposed to be made or given to any director, company secretary or executive officer of Webcentral or any Related Body Corporate of Webcentral as compensation for the loss of, or as consideration for or in connection with his or her retirement from, office in Webcentral or in a Related Body Corporate of Webcentral in connection with the Scheme.

1. Benefits from the Web.com Group

None of the Webcentral Directors has agreed to receive, or is entitled to receive, any benefit from any Web.com Group Member, or any Related Body Corporate of any Web.com Group Member, which is conditional on, or is related to, the Scheme, other than in their capacity as a Webcentral Shareholder.

1. Remuneration in connection with remaining in office

If any of the Webcentral Directors remain on the Webcentral Board following implementation of the Scheme, it is anticipated by the Webcentral Directors that they would receive remuneration and expense reimbursement arrangement for their services commensurate with a position as a non-executive Webcentral Director.

1. Agreements connected with or conditional on the Scheme

Other than as disclosed in section 9.1 above of this Scheme Booklet, there are no agreements or arrangements made between any Webcentral Director and any other person in connection with, or conditional on, the outcome of the Scheme, other than in their capacity as a Webcentral Shareholder.

9.4 Scheme Implementation Deed

1. Introduction

On 12 July 2020, Webcentral and Web.com entered into the Scheme Implementation Deed. A full copy of the Scheme Implementation Deed was attached to Webcentral's announcement to the ASX relating to the Scheme dated 13 July 2020. A copy of the Scheme Implementation Deed can be obtained from the ASX website www.asx.com.au. A summary of the Scheme Implementation Deed is set out in this section 9.4.

1. Scheme Consideration

The consideration for each Webcentral Share is an amount of $0.10 per Webcentral Share.

1. Conditions Precedent (Clause 3)

The Scheme Implementation Deed includes the following Conditions Precedent which must be satisfied or waived (if capable of waiver) before the Scheme can be implemented:

• FIRB approval;
• Webcentral Shareholder approval;
• the Independent Expert issuing a report concluding that the Scheme is in the best interests of Webcentral Shareholders, and not withdrawing that conclusion before 8.00am (Sydney time) on the Second Court Date;
• Court approval;
• no Court or Government Agency restraint;
• no Prescribed Occurrences (which include actions that relate to Webcentral's solvency and share capital, e.g. issuing shares, reducing share capital, etc.);

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• no Material Adverse Change event occurring (described at section 9.4(d) below);
• no material breach of representations and warranties given by Webcentral and Web.com (described at section 9.4(h)); and
• settlement or final determination by a court of competent jurisdiction (with all avenues of appeal having been exhausted) of the Customer Dispute, in either case on terms and conditions that are acceptable to Web.com acting reasonably (described at section 5.5).

1. Material Adverse Change (Clause 3 and Definitions)

The Material Adverse Change condition will be triggered if a Material Adverse Change occurs between (and including) the date of the Scheme Implementation Deed and 8.00am (Sydney time) on the Second Court Date.

In summary, and subject to certain exceptions, a Material Adverse Change includes any event, change, condition, matter, circumstance or thing which has, or is reasonably likely to have, the effect of diminishing the value of:

• the consolidated net assets of the Webcentral Group by at least $3,000,000 against what it otherwise would reasonably have been expected to have been; or
• the revenue from the continuing operations of Webcentral's business division known as SMB Direct (core) by at least $3,000,000 in the current financial year against what it otherwise would reasonably have been expected to have been.

1. Webcentral Board recommendation and voting intentions (Clause 5.10)

Webcentral will use its best endeavours to procure that the Webcentral Board, and each Webcentral Director, does not adversely change, withdraw, adversely modify or adversely qualify its or his recommendation to vote in favour of the Scheme unless:

• the Independent Expert provides an updated report that concludes that the Scheme is not in the best interests of Webcentral Shareholders;
• Webcentral has received a Superior Proposal (which has not been matched by Web.com with a counterproposal that offers an equivalent or superior outcome for Webcentral Shareholders);
• required by a court or Government Agency because of an interest such Webcentral Director has in the Scheme; or
• otherwise required to due to an interests such Webcentral Director has in the Scheme.

1. Conduct of business (Clause 5.4)

In general terms, during the period between signing the Scheme Implementation Deed and the Implementation Date, Webcentral must conduct its businesses and operations in the ordinary and usual course, and operate those businesses substantially in accordance with a "post-COVID" operating plan prepared by Webcentral. In addition, Webcentral must also:

• not enter into, dispose of or acquire new lines of business;
• ensure no Prescribed Occurrence occurs;
• use reasonable endeavours to avoid events within its control that may constitute a Material Adverse Change;
• comply in all material respects with all applicable laws, the Listing Rules, contracts and authorisations;

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• make all reasonable efforts, and procure that each other Webcentral Group Member makes all reasonable efforts, to (i) maintain and preserve the business and assets of the Webcentral Group; (ii) keep available the services of key persons of the Webcentral Group; and (iii) maintain and preserve relationships with Government Agencies, customers, landlords, suppliers and others having business dealings with any Webcentral Group Member; and
• make all reasonable efforts to manage the working capital of the Webcentral Group in the ordinary course of business.

Additionally, Webcentral has agreed that it will not, and will procure its Subsidiaries will not, take certain actions, such as enter into or incur significant new contracts or capital expenditure, acquire or dispose of material assets, materially alter current employment arrangements and change existing constitutional documents, accounting policies and insurances.

Webcentral will, however, be permitted to take any actions:

• to reasonably and prudently respond to an emergency or disaster (including, among other things, an epidemic or pandemic or the impact thereof (which impact is outside the ordinary course of business and does not result from general fluctuations on economic activity));
• expressly required, expressly permitted or expressly contemplated by the Scheme Implementation Deed or the Scheme;
• agreed to in writing by Web.com or requested in writing by Web.com;
• required or permitted by law, regulation, contract or a Government Agency;
• Fairly Disclosed in the Disclosure Materials or in an announcement made by Webcentral to ASX in the 12 months prior to the date of the Scheme Implementation Deed; or
• undertaken in response to a Competing Proposal as permitted by the Scheme Implementation Deed.

1. Integration and change of control (Clauses 5.6 and 5.8)

Webcentral and Web.com have agreed to establish a transition and integration committee (Committee) to oversee the implementation of the Scheme, report on key milestones and seek to determine how best to (i) integrate the Webcentral Group's business into Web.com's operations and (ii) implement plans for carrying on the Webcentral Group's business following the Implementation Date.

The Committee is a consultative body only and will suspend operation in the event that Webcentral that it has received a Superior Proposal and provides Web.com with the material terms and conditions of that Superior Proposal, until such time as Webcentral determines that a Web.com Counterproposal is a matching proposal or Superior Proposal.

Webcentral and Web.com must also seek to identify any change of control (or similar) provisions in certain contracts and authorisations to which a Webcentral Group Member is party that would be triggered by the implementation of the Transaction, and use reasonable endeavours to agree a strategy to provide any requisite notifications or obtain any consents or approvals required.

1. Representations and Warranties (Clause 6 and Schedules 3 and 4)Webcentral gives a number of representations and warranties to Web.com, including that:

• the Webcentral Information contained in this Scheme Booklet is accurate in all material respects and not misleading or deceptive and has been prepared in good faith and in compliance with relevant legal and regulatory requirements;

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• it has complied with its continuous disclosure obligations; and
• it has not issued, and is not under any obligation to issue, any other securities, options, warrants, performance rights or other instruments which are still outstanding and may convert into Webcentral Shares other than as set out in the Scheme Implementation Deed.

Web.com gives a number of representations and warranties to Webcentral including that:

• the Web.com Information contained in this Scheme Booklet is accurate in all material respects and not misleading or deceptive and has been prepared in good faith and in compliance with relevant legal and regulatory requirements;
• it will, by the Implementation Date, have sufficient cash reserves to:
• • pay the Scheme Consideration; and
  • refinance the Existing Debt Facilities and ensure the full and final repayment of all amounts payable to the Existing Financiers under the Existing Debt Facilities (provided such amounts, in aggregate, do not exceed $54 million); and
• it does not require approval from any of its securityholders, or from any securityholders of any other Web.com Group Member, to execute, deliver or perform the Scheme Implementation Deed.

1. Exclusivity (Clause 10)

The Scheme Implementation Deed contains the following customary exclusivity provisions:

• no existing discussions;
• no shop;
• no talk (subject to a fiduciary out);
• notification right for Web.com if Webcentral is approached in relation to a Competing Proposal (subject to a fiduciary out); and
• a5-Business Day matching right period.

1. Reimbursement fees (Clause 11)

The Scheme Implementation Deed contains a Reimbursement Fee of $500,000 (excluding GST) payable by Webcentral to Web.com, which will be triggered if:

• any Webcentral Board Member withdraws or adversely changes or qualifies his recommendation that Webcentral Shareholders vote in favour of the Scheme, or fails to recommend that Webcentral Shareholders vote in favour of the Scheme, or recommends a Competing Proposal, in each case unless:
• • the Independent Expert concludes that the Scheme is not in the best interests of Webcentral Shareholders (except where that conclusion is due wholly or partly to the existence, announcement or publication of a Competing Proposal);
  • a Court or Government Agency requires a change to the recommendation;
  • there has been a failure of the FIRB approval Condition Precedent or "no restraints" Condition Precedent, other than a result of a breach by Webcentral of its obligations to endeavour to procure that the Conditions Precedent are satisfied; or

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• • Webcentral is entitled to terminate the Scheme Implementation Deed for material breach or breach of a Web.com representation or warranty, and has provided a termination notice to Web.com;
• a Competing Proposal is announced prior to 8.00am (Sydney time) on the Second Court Date and completes within 12 months of such announcement; or
• Web.com has terminated the Scheme Implementation Deed following a material breach by Webcentral, in accordance with the requirements of the Scheme Implementation Deed.

A Reverse Reimbursement Fee of $4,400,000 (excluding GST) payable by Web.com to Webcentral will be triggered if the following conditions are satisfied:

• the Customer Dispute has been settled or finally determined on terms and conditions acceptable to Web.com, acting reasonably; and
• the Scheme Implementation Deed has been validly terminated on the basis that the FIRB approval Condition Precedent has not been, or is prevented from being, satisfied by the earlier of 5.00pm on the Business Day before the Second Court Date and 7 months after the date of the Scheme Implementation Deed (or such other date as agreed between Webcentral and Web.com).

The Reimbursement Fee and Reverse Reimbursement Fee are each payable within 10 Business Days of the relevant trigger event occurring and a demand for payment being received.

1. Webcentral Directors and officers, deeds of indemnity and insurance (Clauses 7.1 and 7.3)

Web.com releases its rights and agrees that it will not make, and that after the Implementation Date it will procure that each Webcentral Group Member does not make, any claim against Webcentral, its Subsidiaries and their respective directors, officers and employees, in connection with any breach of representations, covenants and warranties, any false or misleading disclosures whether in content or by omission or any failure to provide information (in each case except in the case of wilful misconduct, wilful concealment or fraud).

Subject to the implementation of the Scheme, Web.com must:

• ensure that the constitutions of Webcentral Group Members continue to contain rules for the indemnification of directors and officers against liability; and
• procure that deeds of indemnity, access and insurance are complied with and thatrun-off directors' and officers' insurance cover is maintained for 7 years from the retirement date of each director and officer. Subject to certain conditions and an agreed regime to place such policy, Webcentral is permitted to pay amounts to ensure to ensure an appropriate D&O policy has been entered into.

9.5 Standstill arrangements

Under the confidentiality deed dated 28 October 2019 between Webcentral and Web.com, Web.com and its Related Entities and Associates (which include Web.com Sub) (Web.com Parties) are subject to a standstill regime under which, without Webcentral's prior written consent, the Web.com Parties must not acquire any, or a relevant interest in any, Webcentral Shares or enter into any derivative contracts which confer rights the economic effect of which are equivalent to the acquisition of Webcentral Shares. The standstill regime applies until the earlier of 28 October 2020 and the time when:

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• Webcentral signs a scheme implementation deed with a person other than one of the Web.com Parties or an Associate of any Web.com's related bodies corporate (Third Party) in connection with a scheme of arrangement that would, if implemented, result in a change of control of Webcentral;
• a Third Party publicly announces a takeover bid which is not subject to any pre- conditions and either:
• • is publicly recommended, or there is a written agreement to publicly recommend, by the Webcentral Board;
  • triggers the operation of section 631 of the Corporations Act; or
  • has a bidder's statement lodged in connection with it in accordance with section 633 or 635 of the Corporations Act; or
• any party other than Webcentral or Web.com and their respective related bodies corporate who at the date of the confidentiality deed was not identified in a notice sent to ASX as having a substantial holding in Webcentral, directly or indirectly holds or acquires an interest in at least 10% of the Webcentral Shares.

9.6 Capital structure

As at the Last Practicable Date, Webcentral had on issue:

Number of Webcentral Shares

122,131,124

Webcentral does not anticipate that it will be required to issue any Webcentral Shares before the Implementation Date.

9.7 Substantial holders

So far as Webcentral is aware, the substantial holders of Webcentral Shares as at the Last Practicable Date are as set out below:

Substantial holder		Number of Webcentral		Voting power
		Shares
Cadence Asset Management Entities	21,230,532	17.38%
Keybridge Capital Limited(1)	11,286,251	9.24%
Merchant Funds Management Pty Ltd (ABN 32	12,300,000	10.07%

154 493 277) as manager of the Merchant Opportunities Fund (ARSN 111 456 387) and Merchant Leaders Fund (ABN 80 475 165 090)

1. The Wilson Asset Management Group has also filed a substantial holder notice in respect of the same parcel of Webcentral Shares, due to the members of the Wilson Asset Management Group holding (in aggregate) voting power in excess of 20% in Keybridge Capital Management.

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9.8 Consents to be named

Web.com and Web.com Sub each has given, and not withdrawn before the registration of this Scheme Booklet with ASIC, its written consent to be named in this Scheme Booklet in the form and context in which it is so named and to the inclusion of the Web.com Information in this Scheme Booklet in the form and context in which such information is included in this Scheme Booklet. Each of Web.com and Web.com Sub: (i) has not caused or authorised the issue of this Scheme Booklet; (ii) does not make, or purport to make, any statement in this Scheme Booklet or any statement on which a statement in this Scheme Booklet is based, other than in relation to the Web.com Information; and (iii) to the maximum extent permitted by law, expressly disclaims all liability in respect of, makes no representation regarding and takes no responsibility for, any part of this Scheme Booklet, other than a reference to its name and the aforementioned information included in this Scheme Booklet with the consent of Web.com and Web.com Sub as specified in this section 9.8.

BDO has given, and not withdrawn before the registration of this Scheme Booklet with ASIC, its written consent to be named in this Scheme Booklet in the form and context in which it is so named and to the inclusion of its Independent Expert's Report contained in Annexure 1. BDO: (i) has not caused or authorised the issue of this Scheme Booklet; (ii) does not make, or purport to make, any statement in this Scheme Booklet or any statement on which a statement in this Scheme Booklet is based, other than in or in relation to the Independent Expert's Report; and (iii) to the maximum extent permitted by law, expressly disclaims all liability in respect of, makes no representation regarding and takes no responsibility for, any part of this Scheme Booklet, other than a reference to its name and the aforementioned information included in this Scheme Booklet (including the Independent Expert's Report) with the consent of BDO as specified in this section 9.8.

Greenwoods & Herbert Smith Freehills (Greenwoods) has given, and not withdrawn before the registration of this Scheme Booklet with ASIC, its written consent to be named in this Scheme Booklet in the form and context in which it is so named as the preparer of the Tax Adviser's Letter in this Scheme Booklet and to the inclusion of the Tax Adviser's Letter, being a letter to the Webcentral Directors, titled "Australian tax consequences of scheme of arrangement" in section 8 of this Scheme Booklet. Greenwoods: (i) has not caused or authorised the issue of this Scheme Booklet; (ii) does not make, or purport to make, any statement in this Scheme Booklet or any statement on which a statement in this Scheme Booklet is based, other than in or in relation to the Tax Adviser's Letter; and

1. to the maximum extent permitted by law, expressly disclaims all liability in respect of, makes no representation regarding and takes no responsibility for, any part of this Scheme Booklet, other than a reference to its name and the aforementioned information included in this Scheme Booklet with the consent of Greenwoods as specified in this section 9.8.

Herbert Smith Freehills (HSF) has given, and not withdrawn before the registration of this Scheme Booklet with ASIC, its written consent to be named in this Scheme Booklet in the form and context in which it is so named. HSF has not made any statement that is included in this Scheme Booklet or any statement on which a statement in this Scheme Booklet is based. HSF has not caused or authorised the issue of this Scheme Booklet, and, other than any reference to its name, takes no responsibility for any other part of this Scheme Booklet.

Macquarie Capital has given, and not withdrawn before the registration of this Scheme Booklet with ASIC, its written consent to be named in this Scheme Booklet in the form and context in which it is so named. Macquarie Capital has not made any statement that is included in this Scheme Booklet or any statement on which a statement in this Scheme Booklet is based. Macquarie Capital has not caused or authorised the issue of this Scheme Booklet, and, other than any reference to its name, takes no responsibility for any other part of this Scheme Booklet.

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Link Market Services has given, and not withdrawn before the registration of this Scheme Booklet with ASIC, its written consent to be named in this Scheme Booklet in the form and context in which it is so named. Link Market Services has not made any statement that is included in this Scheme Booklet or any statement on which a statement in this Scheme Booklet is based. Link Market Services has not caused or authorised the issue of this Scheme Booklet, and, other than any reference to its name, takes no responsibility for any other part of this Scheme Booklet.

Mr Larry Bloch has given, and not withdrawn before the registration of this Scheme Booklet with ASIC, written consent to be named in this Scheme Booklet in relation to his Relevant Interests in Webcentral Shares. Mr Larry Bloch has not made any other statement that is included in this Scheme Booklet or any statement on which a statement in this Scheme Booklet is based. Mr Larry Bloch has not caused or authorised the issue of this Scheme Booklet, and, other than any reference to his name and his Relevant Interests in Webcentral Shares, takes no responsibility for any other part of this Scheme Booklet.

9.9 Intentions of Webcentral Directors

If the Scheme becomes Effective, the existing Webcentral Board will be reconstituted on the Implementation Date, in accordance with the instructions of Web.com.

Accordingly, it is not possible for the Webcentral Directors to provide a statement of their intentions regarding:

• the continuation of the business of Webcentral or how Webcentral's existing business will be conducted;
• any major changes to be made to the business of Webcentral, including any deployment of the fixed assets of Webcentral; and
• the future employment of the present employees of Webcentral,

in each case, after the Scheme is implemented.

If the Scheme is implemented, Web.com Sub will own 100% of Webcentral Shares and will Control Webcentral. The Webcentral Directors have been advised that the intentions of Web.com are as set out in section 6 of this Scheme Booklet.

9.10 Regulatory matters

1. ASIC Relief

Paragraph 8302(d) of Part 3 of Schedule 8 of the Corporations Regulations requires this Scheme Booklet to set out particulars of any payment or benefit proposed to be made or given to any director, secretary or executive officer of Webcentral or a Related Body Corporate (each a Relevant Person) as compensation for loss of office in Webcentral or a Related Body Corporate, or as consideration for or in connection with his or her retirement from office in Webcentral or a Related Body Corporate.

ASIC has granted Webcentral relief from this requirement on the basis that Webcentral is not required to set out in this Scheme Booklet the particulars of any payments or benefits which may be made or given to a Relevant Person in relation to their loss of office, or retirement from office, unless:

• the Relevant Person will lose office or retire from office as a consequence of, or in connection with, the Scheme; or
• the amount of any payment or benefit which may be made to the Relevant Person upon their loss of office, or retirement from office, may be materially affected by the Scheme.

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1. Australian Competition and Consumer Commission (ACCC)

Web.com has received confirmation from the ACCC that it will not oppose the Scheme.

1. New Zealand Overseas Investment Office (OIO)

Web.com Sub notified the OIO of the Transaction under New Zealand's temporary emergency notification regime for overseas investors that was introduced as a result of the COVID-19 outbreak. Web.com Sub has received confirmation from the OIO that New Zealand's Associate Minister of Finance has issued a direction order allowing Web.com Sub to give effect to the Transaction.

9.11 No unacceptable circumstances

The Webcentral Directors believe that the Scheme does not involve any circumstances in relation to the affairs of Webcentral that could reasonably be characterised as constituting 'unacceptable circumstances' for the purposes of section 657A of the Corporations Act.

9.12 Copy of Webcentral Share Register

Under sections 169 and 173 of the Corporations Act, any Webcentral Shareholder has a right to inspect, and to ask for a copy of, the Webcentral Share Register which contains details of the name and address of each Webcentral Shareholder. Webcentral may require a Webcentral Shareholder to provide reasons for their request prior to providing a copy of the Webcentral Share Register, and a Webcentral Shareholder must not use any information obtained for an improper purpose. A copy of the Webcentral Share Register will be given to any Webcentral Shareholder upon request and payment of the prescribed fee under the Corporations Act where Webcentral is satisfied that the details provided are not likely to be used for an improper purpose.

9.13 Transaction costs

Webcentral estimates that it will incur approximately $4.08 million - $4.53 million (excluding GST and disbursements) in external transaction costs which relate to the Scheme. This includes advisory fees (including for Webcentral's financial and legal advisers), the Independent Expert's fees, registry, printing and mailing costs and expenses associated with convening and holding the Scheme Meeting. Of this, approximately $2.33 million - $2.78 million (excluding GST and disbursements) will be incurred regardless of whether or not the Scheme is implemented, excluding any Reimbursement Fee that may be payable to Web.com.

9.14 No other material information

Except as disclosed in this Scheme Booklet, so far as the Webcentral Directors are aware, there is no other information that is:

• material to the making of a decision by a Webcentral Shareholder whether or not to vote in favour of the Scheme; and
• known to any Webcentral Director at the date of lodging this Scheme Booklet with ASIC for registration,

which has not previously been disclosed to Webcentral Shareholders.

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9.15 Supplementary disclosure statement

Webcentral will issue a supplementary document to this Scheme Booklet if it becomes aware of any of the following between the date of this Scheme Booklet and the Second Court Date:

• a material statement in this Scheme Booklet is false or misleading in a material respect;
• a material omission from this Scheme Booklet;
• a significant change affecting a matter included in this Scheme Booklet; or
• a significant new matter has arisen and it would have been required to be included in this Scheme Booklet if it had arisen before the date of this Scheme Booklet.

Depending on the nature and timing of the changed circumstances, and subject to obtaining any relevant approvals, Webcentral may circulate and publish any supplementary document by:

• making an announcement to the ASX;
• placing an advertisement in a prominently published newspaper which is circulated generally throughout Australia;
• posting the supplementary document to Webcentral Shareholders at their address shown on the Webcentral Share Register; and/or
• posting a statement on Webcentral's website atwww.webcentralgroup.com.au, as Webcentral, in its absolute discretion, considers appropriate.

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10 DEFINITIONS AND INTERPRETATION

10.1 Definitions

In this Scheme Booklet, unless the context otherwise appears, the following terms have the meanings shown below:

Term		Meaning
31 January Review	has the meaning given in section 5.4 of this Scheme Booklet.
Event
ACCC	the Australian Competition and Consumer Commission.
Announcement Date	13 July 2020, being the date of announcement of the Scheme to
		the ASX.
ASIC	the Australian Securities and Investments Commission.
Associate	has the meaning set out in section 12 of the Corporations Act, as if
		subsection 12(1) of the Corporations Act included a reference to
		this Scheme Booklet and Webcentral was the designated body.
ASX	ASX Limited ABN 98 008 624 691 and, where the context requires,
		the financial market that it operates.
ATO	the Australian Taxation Office.
Business Day	a day that is not a Saturday, Sunday, public holiday or bank holiday
		in Sydney, Australia or Melbourne, Australia.
Cadence Asset	Cadence Asset Management Pty Ltd (ACN 106 551 062) as trustee
Management Entities	for Cadence Capital Fund and Cadence Capital Limited (ACN 112
		870 096)
Claim	any claim, action, demand, suit or proceeding for damages, debt,
		restitution, equitable compensation, account, injunction, specific
		performance or any other remedy.
Competing Proposal	any offer, expression of interest, proposal, agreement, arrangement
		or transaction, which, if entered into or completed substantially in
		accordance with its terms, would mean a Third Party (either alone

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Term		Meaning
		or together with one or more Associates) would:
		1 directly or indirectly acquire a Relevant Interest in, or have a
		right to acquire, a legal, beneficial or economic interest in, or
		control of, 15% or more of the Webcentral Shares or the share
		capital of any material Subsidiary of Webcentral;
		2 acquire Control of, or merge with, Webcentral or any material
		Subsidiary of Webcentral;
		3 directly or indirectly acquire or become the holder of, or
		otherwise acquire or have a right to acquire, a legal, beneficial
		or economic interest in, or control of, all or a material part of
		Webcentral's business or assets or the business or assets of
		the Webcentral Group;
		4 otherwise directly or indirectly acquire or merge with
		Webcentral or any material Subsidiary of Webcentral; or
		5 require Webcentral to abandon, or otherwise fail to proceed
		with, the Transaction,
		whether by way of takeover bid, members' or creditors' scheme of
		arrangement, shareholder approved acquisition, capital reduction,
		buy back, sale or purchase of shares, other securities or assets,
		assignment of assets and liabilities, incorporated or unincorporated
		joint venture, dual-listed company (or other synthetic merger), deed
		of company arrangement, any debt for equity arrangement or other
		transaction or arrangement.
		For the avoidance of doubt, each successive material modification
		or variation of any proposal, agreement, arrangement or
		transaction in relation to a Competing Proposal will constitute a
		new Competing Proposal.
Condition Precedent	each of the conditions precedent set out in clause 3.1 of the
		Scheme Implementation Deed.
Control	has the meaning given in section 50AA of the Corporations Act.
Corporations Act	the Corporations Act 2001(Cth), as modified or varied by ASIC.
Corporations	theCorporations Regulations 2001 (Cth).
Regulations
Court	the Supreme Court of New South Wales or such other court of
		competent jurisdiction under the Corporations Act agreed to in
		writing by Web.com and Webcentral.
Customer Dispute	the customer dispute referred to in Webcentral's annual report for

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Term		Meaning
		the year ended 31 December 2019 (published on the ASX on 30
		March 2020 when Webcentral was still called Arq Group Limited)
		and all claims and cross-claims which are part of, relate to, or that
		arise out of or concern the matters or events the subject of, that
		dispute.
Deed Poll	a deed poll in the form of Annexure 3 under which Web.com and
		Web.com Sub each covenants in favour of the Scheme
		Shareholders to perform the obligations attributed to Web.com and
		Web.com Sub under the Scheme.
Disclosure Materials	1 the documents and information contained in the data room
		made available by Webcentral to Web.com or any of its Related
		Persons, the index of which has been initialled by, or on behalf
		of, the parties for identification; and
		2 written responses from Webcentral or any of its Related
		Persons to requests for information made by Web.com or any
		of its Related Persons and their respective representatives or
		advisers (including, for the avoidance of doubt, any documents
		and information attached to the written responses).
EBITDA	earnings before interest, tax, depreciation and amortisation.
Effective	when used in relation to the Scheme, the coming into effect, under
		subsection 411(10) of the Corporations Act, of the order of the
		Court made under paragraph 411(4)(b) of the Corporations Act in
		relation to the Scheme.
Effective Date	the date on which the Scheme becomes Effective, currently
		expected to be 1 October 2020.
End Date	1 the date which is 7 months after the date of the Scheme
		Implementation Deed; or
		2 such other date as agreed in writing by Webcentral and
		Web.com.

Existing Debt Facilities each of the:

• A$ facilities advanced, and bank guarantees issued, pursuant to a facilities agreement originally dated 28 June 2018 between, among others, Australia and New Zealand Banking Group Limited and Webcentral (as amended from time to time including on or about 30 May 2019 and 23 December 2019); and

• A$ facilities advanced, and bank guarantees issued, pursuant

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Term		Meaning
		to a facilities agreement originally dated 28 June 2018,
		between, among others, National Australia Bank Limited and
		Webcentral (as amended from time to time including on or
		about 30 May 2019 and 23 December 2019).
Existing Financiers	1 Australia and New Zealand Banking Group Limited; and
		2 National Australia Bank Limited.
Fairly Disclosed	a reference to 'Fairly Disclosed' means disclosed to Web.com or
		Webcentral (as applicable) or any of its Related Persons, to a
		sufficient extent, and in sufficient detail, so as to enable a
		reasonable person (or one of its Related Persons) experienced in
		transactions similar to the Transaction and experienced in a
		business similar to any business conducted by the Webcentral
		Group or the Web.com Group (respectively) to identify the nature
		and scope of the relevant matter, event or circumstance (including,
		in each case, that the potential financial effect of the relevant
		matter, event or circumstance was reasonably ascertainable from
		the information disclosed).
Financial Adviser	any financial adviser retained by a party in relation to the
		Transaction from time to time.
FIRB	the Australian Foreign Investment Review Board.
First Court Date	the first day on which an application made to the Court for an order
		under subsection 411(1) of the Corporations Act convening the
		Scheme Meeting is heard, or, if the application is adjourned or
		subject to appeal for any reason, the day on which the adjourned
		application is heard.
Government Agency	any foreign or Australian government or governmental, semi-
		governmental, administrative, fiscal or judicial body, department,
		commission, authority, tribunal, agency or entity (including any
		stock or other securities exchange), or any minister of the Crown in
		right of the Commonwealth of Australia or any State, and any other
		federal, state, provincial, or local government, whether foreign or
		Australian.
GST	goods and services tax or similar value added tax levied or
		imposed in Australia under the GST Law or otherwise on a supply.
GST Act	theA New Tax System (Goods and Services Tax) Act 1999 (Cth).

76 Webcentral Group Limited | Scheme Booklet

Term		Meaning
GST Law		has the same meaning as in the GST Act.
Implementation Date		the third Business Day after the Scheme Record Date, currently
	expected to be 12 October 2020, or such other date after the
		Scheme Record Date as Webcentral and Web.com agree in
		writing.
Independent Expert		BDO Corporate Finance (WA) Pty Ltd ACN 124 031 045, the
		independent expert in respect of the Scheme appointed by
		Webcentral.
Independent Expert's		the report issued by the Independent Expert in connection with the
Report		Scheme, as set out in Annexure 1.
Insolvency Event		in relation to an entity:
		1 the entity resolving that it be wound up or a court making an
		order for the winding up or dissolution of the entity (other than
		where the order is set aside within 14 days);
		2 a liquidator, provisional liquidator, administrator, receiver,
		receiver and manager or other insolvency official being
		appointed to the entity or in relation to the whole, or a
		substantial part, of its assets;
		3 the entity executing a deed of company arrangement;
		4 the entity ceases, or threatens to cease to, carry on
		substantially all the business conducted by it as at the date of
		the Scheme Implementation Deed;
		5 the entity is or becomes unable to pay its debts when they fall
		due within the meaning of the Corporations Act (or, if
		appropriate, legislation of its place of incorporation); or
		6 the entity being deregistered as a company or otherwise
		dissolved.
Last Practicable Date		18 August 2020.
Listing Rules		the official listing rules of the ASX.
Long Term Incentive		the plan under which long term incentives are awarded by
Plan	Webcentral to selected key personnel.
Macquarie Capital		Macquarie Capital (Australia) Limited ACN 123 199 548.

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10 Definitions and interpretation CONT.

Term		Meaning
Material Adverse	an event, change, condition, matter, circumstance or thing
Change	occurring after the date of the Scheme Implementation Deed
		(Specified Event) which, whether individually or when aggregated
		with all such events, changes, conditions, matters, circumstances
		or things of a like kind that have occurred or are reasonably likely to
		occur has had or would be considered reasonably likely to have the
		effect of diminishing the value of:
		1	the consolidated net assets of the Webcentral Group by at least
			$3,000,000 against what it would reasonably have been
			expected to have been but for such Specified Event (calculated
			in accordance with the accounting policies and practices
			applied by Webcentral in respect of the financial year ended 31
			December 2019); or
		2	the revenue from the continuing operations of Webcentral's
			business division known as SMB Direct (core) by at least
			$3,000,000 in the current financial year against what it would
			reasonably have been expected to have been but for such
			Specified Event (calculated in accordance with the accounting
			policies and practices applied by Webcentral in respect of the
			financial year ended 31 December 2019),
		other than those events, changes, conditions, matters,
		circumstances or things:
		3	required under, or expressly permitted by, the Scheme
			Implementation Deed, the Scheme or the transactions
			contemplated by either;
		4	to the extent that they were Fairly Disclosed in the Disclosure
			Materials;
		5	agreed to in writing, or requested in writing, by Web.com;
		6	directly relating to costs and expenses incurred by Webcentral
			associated with the Scheme process or Transaction, including
			all fees payable to external advisers of Webcentral, in each
			case to the extent such amounts are Fairly Disclosed in the
			Disclosure Materials;
		7	arising as a result of any generally applicable change in law
			(including subordinate legislation), regulation, orders,
			accounting standards or governmental policy;
		8	arising from changes that affect the domain and hosting
			industry generally, provided that such changes do not have a
			materially disproportionate effect on Webcentral relative to
			other participants in that industry;
		9	arising from changes in economic, business, industry or political
			conditions that impact on Webcentral and its competitors in a
			similar manner (including interest rates, general economic,
			political or business conditions, including material adverse
			changes or major disruptions to, or fluctuations in, domestic or
			international financial markets);
		10	arising from any act of terrorism, outbreak or escalation of war
			(whether or not declared), major hostilities, civil unrest or

outbreak or escalation of any disease epidemic or pandemic (including the outbreak, escalation or any impact of, or recovery

78 Webcentral Group Limited | Scheme Booklet

Term		Meaning
			from, the Coronavirus or COVID-19 pandemic);
		11	arising from any act of God, natural disaster, lightning, storm
			flood, bushfire, earthquake, explosion, cyclone, tidal wave,
			landslide, on or after the date of the Scheme Implementation
			Deed;
		12	that Webcentral Fairly Disclosed in an announcement made by
			Webcentral to ASX in the 5 years prior to the date of the
			Scheme Implementation Deed;
		13	directly relating to any write down of trade receivables in
			connection with any settlement of any litigation; or
		14	any write down of goodwill in connection with or as a result of
			the terms of the Transaction as proposed by Web.com.
Net Leverage Ratio	as at the relevant test date, the ratio of A to B, where:
		A = the sum of the financial indebtedness of the Webcentral Group
		less cash and cash equivalents held by the Webcentral Group; and
		B = the sum of the consolidated EBITDA of the Webcentral Group
		for the preceding 12 month period.
Net Tangible Assets	1	at any time, the consolidated total at that time of all assets of
			the Webcentral Group, taken as a whole, which in accordance
			with applicable accounting principles would be included in the
			consolidated statement of financial position of the Webcentral
			Group at that time (including, for the avoidance of doubt, any
			cash deposits provided by a Webcentral Group Member to a
			third party as security, including cash held in broker accounts)
			but excluding:
			a. any financial instrument assets; and
			b. any deferred tax assets associated with financial
			instruments,
		less:
		2	at any time, the consolidated total of all liabilities of the
			Webcentral Group, taken as a whole, in respect of which in
			accordance with applicable accounting principles would be
			included in the consolidated statement of financial position of
			the Webcentral Group at that time but excluding:
			a. any financial instrument liabilities; and
			b. any deferred tax liabilities associated with financial
			instruments.
Performance Right	a right to subscribe for a Webcentral Share in accordance with the
		terms of the Long Term Incentive Plan.

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10 Definitions and interpretation CONT.

TermMeaning

Prescribed Occurrence other than as:

• required or permitted by the Scheme Implementation Deed, the Scheme or the transactions contemplated by either;

• Fairly Disclosed in the Disclosure Materials;

• agreed to in writing, or requested, by Web.com;

• required by applicable law or by an order of a court or Government Agency; or

• Fairly Disclosed by Webcentral in an announcement made by Webcentral to ASX in the 5 years prior to the date of the Scheme Implementation Deed,

the occurrence of any of the following:

• Webcentral converting all or any of its shares into a larger or smaller number of shares;

• Webcentral resolving to reduce its share capital in any way;
  3 a member of the Webcentral Group:
• • entering into abuy-back agreement; or
  • resolving to approve the terms of abuy-back agreement under the Corporations Act;

• a member of the Webcentral Group issuing shares, or granting an option over its shares, or agreeing to make such an issue or grant such an option, other than:
• • to a directly or indirectlywholly-owned Subsidiary of Webcentral; or
  • upon vesting or exercise of, or in respect of, Performance Rights on issue before the date of the Scheme Implementation Deed;

• a member of the Webcentral Group issuing or agreeing to issue securities convertible into shares;

• a member of the Webcentral Group disposing, or agreeing to dispose, of the whole, or a substantial part, of its business or property;

• a member of the Webcentral Group granting, or agreeing to grant, a Security Interest in the whole, or a substantial part, of its business or property;

• an Insolvency Event occurs in relation to a member of the Webcentral Group;

• Webcentral pays, declares, distributes or incurs a liability to make or pay a dividend, bonus or other share of its profits, income, capital or assets by way of dividend or other form of distribution;

1. any member of the Webcentral Group ceases, or threatens to cease to, carry on the business conducted as at the date of the Scheme Implementation Deed; or
2. any member of the Webcentral Group directly or indirectly

80 Webcentral Group Limited | Scheme Booklet

Term		Meaning
		authorises, commits or agrees to take or announces any of the
		actions referred to in paragraphs 1 to 10 above insofar as it
		applies to the member of the Webcentral Group the subject of
		the relevant actions referred to in paragraphs 1 to 10 above
Reimbursement Fee	$500,000.
Related Bodies	has the meaning set out in section 50 of the Corporations Act.
Corporate
Related Entities	in relation to an entity, means another entity that is a Related Body
		Corporate of the first entity, and in relation to Web.com includes
		any fund, limited partnership or other collective investment vehicle
		which is managed or advised by Web.com or a Related Body
		Corporate of Web.com.
Related Person	1 in respect of Webcentral, Web.com or their respective Related
		Bodies Corporate, each director, officer, employee, adviser,
		agent or representative of Webcentral, Web.com or such
		Related Body Corporate (as applicable); and
		2 in respect of a Financial Adviser, each director, officer or
		employee of that Financial Adviser.
Relevant Interest	has the meaning given in sections 608 and 609 of the Corporations
		Act.
Requisite Majorities	in relation to the Scheme Resolution, a resolution passed by:
		1 unless the Court orders otherwise, a majority in number (more
		than 50%) of Webcentral Shareholders present and voting at
		the Scheme Meeting (either in person or by proxy, attorney or,
		in the case of corporate Webcentral Shareholders, body
		corporate representative); and
		2 at least 75% of the total number of votes cast on the Scheme
		Resolution at the Scheme Meeting by Webcentral Shareholders
		present and voting (either in person or by proxy, attorney or, in
		the case of corporate Webcentral Shareholders, body corporate
		representative).
RG 60	Regulatory Guide 60 issued by ASIC in September 2011.
Scheme	the scheme of arrangement under Part 5.1 of the Corporations Act
		between Webcentral and the Scheme Shareholders, the form of
		which is attached as Annexure 2, subject to any alterations or

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10 Definitions and interpretation CONT.

Term		Meaning
		conditions made or required by the Court under subsection 411(6)
		of the Corporations Act and agreed to in writing by Web.com and
		Webcentral.
Scheme Booklet		this document being the explanatory statement in respect of the
		Scheme, which has been prepared by Webcentral in accordance
		with section 412 of the Corporations Act.
Scheme Consideration		the consideration to be provided by Web.com to each Scheme
		Shareholder for the transfer to Web.com Sub of each Scheme
		Share, being for each Webcentral Share held by a Scheme
		Shareholder as at the Scheme Record Date, an amount of $0.10.
Scheme		the Scheme Implementation Deed dated 12 July 2020 between
Implementation Deed		Webcentral and Web.com, a copy of which was released to the
		ASX on 13 July 2020.
Scheme Meeting		the meeting of Webcentral Shareholders ordered by the Court to be
		convened under subsection 411(1) of the Corporations Act to
		consider and vote on the Scheme and includes any meeting
		convened following any adjournment or postponement of that
		meeting.
Scheme Record Date		7.00pm (Sydney time) on the third Business Day after the Effective
		Date, currently expected to 7 October 2020, or such other time and
		date as Webcentral and Web.com agree in writing.
Scheme Resolution		the resolution to the terms of the Scheme, as set out in the Notice
		of Scheme Meeting in Annexure 4.
Scheme Shareholder		a holder of Webcentral Shares recorded in the Webcentral Share
		Register as at the Scheme Record Date.
Scheme Shares		all Webcentral Shares held by the Scheme Shareholders as at the
	Scheme Record Date.
Second Court Date		the first day on which an application made to the Court for an order
		under paragraph 411(4)(b) of the Corporations Act approving the
		Scheme is heard, currently expected to be 1 October 2020, or, if
		the application is adjourned or subject to appeal for any reason, the
		day on which the adjourned application or appeal is heard.

82 Webcentral Group Limited | Scheme Booklet

Term		Meaning
Second Court Hearing	the hearing of the application made to the Court for an order
		pursuant to section 411(4)(b) of the Corporations Act approving the
		Scheme.
Security Interest	has the meaning given in section 51A of the Corporations Act.
Siris Capital Funds	1 Siris Partners III, LP, a limited liability partnership organised in
		Delaware (Siris III). The general partner of Siris III is Siris
		Partners GP III, LP (Siris III GP);
		2 Siris Partners III Parallel, LP, a limited liability partnership
		organised in Delaware (Siris Parallel III). The general partner
		of Siris Parallel III is Siris III GP;
		3 Siris Partners IV, LP, a limited liability partnership organised in
		Delaware (Siris IV). The general partner of Siris IV is Siris
		Partners GP IV, LP (Siris IV GP); and
		4 Siris Partners IV Parallel, LP, a limited liability partnership
		organised in Delaware (Siris Parallel IV). The general partner
		of Siris Parallel IV is Siris IV GP.
Subsidiary	has the meaning given in Division 6 of Part 1.2 of the Corporations
		Act.
Superior Proposal	a bona fide Competing Proposal:
		1 of the kind referred to in any of paragraphs 2, 3 or 4 of the
		definition of Competing Proposal; and
		2 not resulting from a breach by Webcentral of any of its
		obligations under clause 10 of the Scheme Implementation
		Deed (it being understood that any actions by the Related
		Persons of Webcentral not permitted by clause 10 will be
		deemed to be a breach by Webcentral for the purposes hereof),
		that the Webcentral Board, acting in good faith, and after receiving
		written legal advice from its external legal advisers and financial
		advisers, determines:
		3 is reasonably capable of being valued and completed within a
		reasonable timeframe in accordance with its terms; and
		4 would, if completed substantially in accordance with its terms,
		be more favourable to Webcentral Shareholders (as a whole)
		than the Transaction (if applicable, as amended or varied
		following application of the matching right set out in clause 10.5
		of the Scheme Implementation Deed),
		in each case taking into account all terms and conditions and other
		aspects of the Competing Proposal (including, but not limited to,
		timing considerations, any conditions precedent, the value and type
		of consideration, the level of certainty as to the funding required for
		the Competing Proposal, the identity, reputation and financial

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10 Definitions and interpretation CONT.

Term		Meaning
		condition of the proponent or other matters affecting the probability
		of the Competing Proposal being completed and the outcome of
		Webcentral Shareholders) and of the Transaction.
Tax Adviser's Letter	the letter issued by Greenwoods & Herbert Smith Freehills as set
		out in section 8 of this Scheme Booklet.
Third Party	a person other than Web.com, its Related Bodies Corporate and its
		other Associates.
Transaction	the acquisition of the Scheme Shares by Web.com Sub through
		implementation of the Scheme in accordance with the terms and
		conditions of the Scheme Implementation Deed.
VWAP	volume weighted average price.
Webcentral	Webcentral Group Limited ACN 073 716 793.
Webcentral Board	the board of directors of Webcentral and a Webcentral Board
		Member orWebcentral Director means any director of
		Webcentral comprising part of the Webcentral Board.
Webcentral Group	Webcentral and each of its Subsidiaries, and a reference to a
		Webcentral Group Member or amember of the Webcentral
		Groupis to Webcentral or any of its Subsidiaries.
Webcentral	information regarding the Webcentral Group prepared by
Information	Webcentral for inclusion in this Scheme Booklet that explains the
		effect of the Scheme and sets out the information prescribed by the
		Corporations Act and the Corporations Regulations, and any other
		information that is material to the making of a decision by
		Webcentral Shareholders whether or not to vote in favour of the
		Scheme, being information that is within the knowledge of each of
		the Webcentral Board Members, which for the avoidance of doubt
		does not include:
		1 the Web.com Information;
		2 the Independent Expert's Report; or
		3 any description of the taxation effect of the Transaction on
		Scheme Shareholders prepared by an external adviser to
		Webcentral.

84 Webcentral Group Limited | Scheme Booklet

Term		Meaning
Webcentral Share	a fully paid ordinary share in the capital of Webcentral.
Webcentral Share	the register of members of Webcentral maintained in accordance
Register	with the Corporations Act.
Webcentral Share	Link Market Services Limited ABN 54 083 214 537.
Registry
Webcentral	each person who is registered as the holder of a Webcentral Share
Shareholder	in the Webcentral Share Register.
Web.com	Web.com Group, Inc., a U.S. corporation established in Delaware,
		of 5335 Gate Parkway, Jacksonville, Florida 32256, United States
		of America.
Web.com Board	the board of directors of Web.com and a Web.com Board Member
		or Web.com Directormeans any director of Web.com comprising
		part of the Web.com Board.
Web.com	has the meaning given in the Scheme Implementation Deed.
Counterproposal
Web.com Group	Web.com and each of its Subsidiaries, and a reference to a
		Web.com Group Member or amember of the Web.com Group
		is to Web.com or any of its Subsidiaries.
Web.com Information	all of the information contained in section 6 (Information about
		Web.com and the Web.com Group), and the answers to the
		questions "Who is Web.com" and "Who is Web.com Sub" in section
		2, of this Scheme Booklet.
Web.com Sub	Web.com Aus Bidco Pty Ltd ACN 635 836 298.

10.2 Interpretation

In this Scheme Booklet, unless expressly stated or the context otherwise appears:

1. words and phrases have the same meaning (if any) given to them in the Corporations Act;
2. words importing a gender include any gender;

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10 Definitions and interpretation CONT.

1. words importing the singular include the plural and vice versa;
2. an expression importing a natural person includes any company, partnership, joint venture, association, corporation or other body corporate and vice versa;
3. a reference to a section or annexure is a reference to a section of and an annexure to this Scheme Booklet as relevant;
4. a reference to any statute, regulation, proclamation, ordinance or by law includes all statutes, regulations, proclamations, ordinances, or by laws amending, varying, consolidating or replacing it and a reference to a statute includes all regulations, proclamations, ordinances and by laws issued under that statute;
5. headings and bold type are for convenience only and do not affect the interpretation of this Scheme Booklet;
6. a reference to time is a reference to time in Sydney, Australia;
7. a reference to writing includes facsimile transmissions; and
8. a reference to dollars, $, cents, ¢ and currency is a reference to the lawful currency of the Commonwealth of Australia.

86 Webcentral Group Limited | Scheme Booklet

ANNEXURE 1 INDEPENDENT EXPERT'S REPORT

WEBCENTRAL GROUP LIMITED

Independent Expert's Report

17 August 2020

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87

Annexure 1 Independent Expert's Report CONT.

Financial Services Guide

17 August 2020

BDO Corporate Finance (WA) Pty LtdABN 27 124 031 045 ('we' or 'us' or 'ours' as appropriate) has been engaged by Webcentral Group Limited ('Webcentral') to provide an independent expert's report on the proposed Scheme of arrangement ('the Scheme') with Web.com Group, Inc. ('Web.com'). You are being provided with a copy of our report because you are a shareholder of Webcentral and this Financial Services Guide ('FSG') is included in the event you are also classified under the Corporations Act 2001 ('the Act') as a retail client.

Our report and this FSG accompanies the Scheme Booklet required to be provided to you by

Webcentral to assist you in deciding on whether or not to approve the proposal.

Financial Services Guide

This FSG is designed to help retail clients make a decision as to their use of our general financial product advice and to ensure that we comply with our obligations as a financial services licensee.

This FSG includes information about:

Who we are and how we can be contacted;

The services we are authorised to provide under our Australian Financial Services Licence No. 316158; Remuneration that we and/or our staff and any associates receive in connection with the general financial product advice;

Any relevant associations or relationships we have; and

Our internal and external complaints handling procedures and how you may access them.

Information about us

We are a member firm of the BDO network in Australia, a national association of separate entities (each of which has appointed BDO (Australia) Limited ACN 050 110 275 to represent it in BDO International). The financial product advice in our report is provided by BDO Corporate Finance (WA) Pty Ltd and not by BDO or its related entities. BDO and its related entities provide professional services primarily in the areas of audit, tax, consulting, mergers and acquisition, and financial advisory services.

We and BDO (and its related entities) might from time to time provide professional services to financial product issuers in the ordinary course of business and the directors of BDO Corporate Finance (WA) Pty Ltd may receive a share in the profits of related entities that provide these services.

Financial services we are licensed to provide

We hold an Australian Financial Services Licence that authorises us to provide general financial product advice for securities to retail and wholesale clients, and deal in securities for wholesale clients. The authorisation relevant to this report is general financial product advice.

When we provide this financial service we are engaged to provide an expert report in connection with the financial product of another person. Our reports explain who has engaged us and the nature of the report we have been engaged to provide. When we provide the authorised services we are not acting for you.

General Financial Product Advice

We only provide general financial product advice, not personal financial product advice. Our report does not take into account your personal objectives, financial situation or needs. You should consider the appropriateness of this general advice having regard to your own objectives, financial situation and needs before you act on the advice. If you have any questions, or don't fully understand our report you should seek professional financial advice.

BDO CORPORATE FINANCE (WA) PTY LTD

88 Webcentral Group Limited | Scheme Booklet

Financial Services Guide

Page 2

Fees, commissions and other benefits that we may receive

We charge fees for providing reports, including this report. These fees are negotiated and agreed with the person who engages us to provide the report. Fees are agreed on an hourly basis or as a fixed amount depending on the terms of the agreement. The fee payable to BDO Corporate Finance (WA) Pty Ltd for this engagement is approximately $45,000.

Except for the fees referred to above, neither BDO, nor any of its directors, employees or related entities, receive any pecuniary benefit or other benefit, directly or indirectly, for or in connection with the provision of the report and our directors do not hold any shares in Webcentral.

Remuneration or other benefits received by our employees

All our employees receive a salary. Our employees are eligible for bonuses based on overall productivity but not directly in connection with any engagement for the provision of a report. We have received a fee for our professional services in providing this report. That fee is not linked in any way with our opinion as expressed in this report.

Referrals

We do not pay commissions or provide any other benefits to any person for referring customers to us in connection with the reports that we are licensed to provide.

Complaints resolution

Internal complaints resolution process

As the holder of an Australian Financial Services Licence, we are required to have a system for handling complaints from persons to whom we provide financial product advice. All complaints must be in writing addressed to The Complaints Officer, BDO Corporate Finance (WA) Pty Ltd, PO Box 700 West Perth WA 6872.

When we receive a written complaint we will record the complaint, acknowledge receipt of the complaint within 15 days and investigate the issues raised. As soon as practical, and not more than 45 days after receiving the written complaint, we will advise the complainant in writing of our determination.

Referral to External Dispute Resolution Scheme

A complainant not satisfied with the outcome of the above process, or our determination, has the right to refer the matter to the Australian Financial Complaints Authority ('AFCA').

AFCA is an external dispute resolution scheme that deals with complaints from consumers in the financial system. It is a not-for-profit company limited by guarantee and authorised by the responsible federal minister. AFCA was established on 1 November 2018 to allow for the amalgamation of all Financial Ombudsman Service ('FOS') schemes into one. AFCA will deal with complaints from consumers in the financial system by providing free, fair and independent financial services complaint resolution. If an issue has not been resolved to your satisfaction you can lodge a complaint with AFCA at any time.

Our AFCA Membership Number is 12561. Further details about AFCA are available on its website

www.afca.org.auor by contacting it directly via the details set out below.

Australian Financial Complaints Authority

GPO Box 3

Melbourne VIC 3001

AFCA Free call: 1800 931 678

Website: www.afca.org.au

Email:[e-mail]

You may contact us using the details set out on page 1 of the accompanying report.

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89

Annexure 1 Independent Expert's Report CONT.

TABLE OF CONTENTS

1.	Introduction	1
2.	Summary and Opinion	1
3.	Scope of the Report	4
4.	Outline of the Scheme	6
5.	Profile of Webcentral	7
6	Profile of acquirer	18
7	Economic analysis	19
8	Industry analysis	20
9.	Valuation approach adopted	23
10	Valuation of Webcentral prior to transaction	25
11	Valuation of Scheme Consideration	43
12	Is the Scheme fair?	43
13	Is the Scheme reasonable?	44
14	Conclusion	46
15	Sources of information	46
16	Independence	46
17	Qualifications	47
18	Disclaimers and consents	48

Appendix 1 - Glossary and copyright notice Appendix 2 - Valuation Methodologies Appendix 3 - Trading and Transaction Multiples © 2020 BDO Corporate Finance (WA) Pty Ltd

90 Webcentral Group Limited | Scheme Booklet

17 August 2020

The Directors

Webcentral Group Limited

Level 23, 680 George Street

Sydney, NSW, 2000

Dear Directors

INDEPENDENT EXPERT'S REPORT

1. Introduction

On 13 July 2020, Webcentral Group Limited ('Webcentral' or 'the Company') announced that it had entered into a Scheme Implementation Deed dated 12 July 2020 ('SID') with Web.com Group, Inc. ('Web.com'), under which Web.com will acquire the entire issued capital of Webcentral by way of a scheme of arrangement under the Australian Corporations Act 2001 (Cth) ('the Scheme'). Under the Scheme, Webcentral shareholders will receive cash consideration of $0.10 for every Webcentral share that they hold ('Scheme Consideration').

Additional information regarding the terms of, and conditions precedent to, the Scheme can be found in Section 4.

All currencies in this report are expressed in Australian Dollars unless otherwise specified.

2. Summary and Opinion

2.1 Requirement for the report

The directors of Webcentral have requested that BDO Corporate Finance (WA) Pty Ltd ('BDO') prepare an independent expert's report ('our Report') to express an opinion as to whether or not the Scheme is in the best interests of the shareholders of Webcentral ('Shareholders').

Our Report is prepared pursuant to section 411 of the Corporations Act 2001 ('Corporations Act'or 'the Act') and is to be included in the Scheme Booklet for Webcentral in order to assist the Shareholders in their decision whether to approve the Scheme.

2.2 Approach

Our Report has been prepared having regard to Australian Securities and Investments Commission ('ASIC') Regulatory Guides 60 'Schemes of Arrangements' ('RG 60'), Regulatory Guide 111 'Content of Expert's Reports' ('RG 111') and Regulatory Guide 112 'Independence of Experts' ('RG 112').

In arriving at our opinion, we have assessed the terms of the Scheme as outlined in the body of this report. We have considered:

BDO Corporate Finance (WA) Pty Ltd ABN 27 124 031 045 AFS Licence No 316158 is a member of a national association of independent entities which are all members of BDO (Australia) Ltd ABN 77 050 110 275, an Australian company limited by guarantee. BDO Corporate Finance (WA) Pty Ltd and BDO (Australia) Ltd are members of BDO International Ltd, a UK company limited by guarantee, and form part of the international BDO network of independent member firms. Liability limited by a scheme approved under Professional Standards Legislation.

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• How the value of a Webcentral share prior to the Scheme on a control basis compares to the value of the Scheme Consideration;
• The likelihood of an alternative offer being made to Webcentral;
• Other factors which we consider to be relevant to the Shareholders in their assessment of the Scheme; and
• The position of Shareholders should the Scheme not proceed.

2.3 Opinion

We have considered the terms of the Scheme as outlined in the body of this report and have concluded that, in the absence of an alternate offer, the Scheme is fair and reasonable.

Therefore, in the absence of a superior proposal, we conclude the Scheme is in the best interest of

Shareholders.

2.4 Fairness

In section 12 we determined that the value of a Webcentral share (on a controlling interest basis) compares to the value of the Scheme Consideration, as detailed below.

			Ref		Low		High
				$		$
	Value of a share in Webcentral		10.3		0.083		0.126
	Value of Scheme Consideration		11		0.10		0.10

Source:BDO analysis

The above valuation ranges are graphically presented below:

Valuation Summary

Value of a Webcentral share prior to the

Transaction on a control basis

Value of Scheme Consideration

0.000 0.020 0.040 0.060 0.080 0.100 0.120 0.140

Value ($)

The above pricing indicates that, in the absence of any other relevant information, and an alternate offer, the Scheme is fair for Shareholders.

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2.5 Reasonableness

We have considered the analysis in section 13 of this report, in terms of both

• advantages and disadvantages of the Scheme; and
• other considerations, including the position of Shareholders if the Scheme does not proceed and the consequences of not approving the Transaction.

In our opinion, the position of Shareholders if the Scheme is approved is more advantageous than the position if the Scheme is not approved. Accordingly, in the absence of any other relevant information and/or an alternate proposal we believe that the Scheme is reasonable for Shareholders.

The respective advantages and disadvantages considered are summarised below:

ADVANTAGES AND DISADVANTAGES

	Section		Advantages		Section		Disadvantages
	13.3.1		The Scheme is fair		13.4.1		Shareholders will be unable to participate in
							the potential upside of the Company's
							operations
	13.3.2		Reduces the risk of Webcentral being sold		13.4.2		Shareholders will forego the opportunity to
			for less than favourable or distressed				potentially receive dividends in the future
			conditions
	13.3.3		Shareholders receive certain value for
			their shareholding in the Company as cash
			under the Scheme
	13.3.4		The Scheme consideration offered is at a
			premium to the last traded price of a
			Webcentral share prior to the
			announcement of the Scheme
	13.3.5		Shareholders will no longer be exposed to
			the risks associated with being a
			shareholder of Webcentral

Other key matters we have considered include:

SectionDescription

1. Alternative proposals
2. Consequences of not approving the Scheme

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3. Scope of the Report

3.1 Purpose of the Report

The Scheme is to be implemented pursuant to section 411 of the Corporations Act. Part 3 of Schedule 8 to the Corporations Act Regulations 2001 ('Regulations') prescribes the information to be sent to shareholders in relation to schemes of arrangement pursuant to section 411 of the Act ('Section 411').

An independent expert's report must be obtained by a scheme company if:

• There is one or more common directors; or
• The other party to the scheme holds 30% or more of the voting shares in the scheme company.

The expert must be independent and must state whether or not, in his or her opinion, the proposed scheme is in the best interest of the members of the company the subject of the scheme and set out the reasons for that opinion.

Accordingly, an independent expert's report is not required under the Corporations Regulations.

Notwithstanding the fact that there is no requirement to engage an independent expert to report on the Scheme, the directors of Webcentral have requested that BDO prepare this report as if it were an independent expert's report, and to provide an opinion as to whether the scheme is fair and reasonable, that is in the best interests of members of the company the subject of the scheme.

The requirement for an independent experts report is also a precondition in the SID, which states that for the Scheme to proceed (unless this condition is waived) the independent expert must conclude (and continue to conclude) that the Scheme is in the best interests of Shareholders.

3.2 Regulatory guidance

Neither the Act nor the Regulations defines the term 'in the best interests of'. In determining whether the Scheme is in the best interests of Shareholders, we have had regard to the views expressed by ASIC in RG

111. This regulatory guide provides guidance as to what matters an independent expert should consider to assist security holders to make informed decisions about transactions.

A key matter under RG 111 that an expert needs to consider when determining the appropriate form of analysis is whether or not the effect of the transaction is comparable to a takeover bid and is therefore representative of a change of 'control' transaction.

In the circumstance of a scheme that achieves the same outcome as a takeover bid, RG 111 suggests that the form of the analysis undertaken by the independent expert should be substantially the same as for a takeover. Independent expert reports required under the Act in the circumstance of a takeover are required to provide an opinion as to whether or not the takeover bid is 'fair and reasonable'. While there is no definition of 'fair and reasonable', RG 111 provides some guidance as to how the terms should be interpreted in a range of circumstances.

RG 111 suggests that an opinion as to whether transactions are fair and reasonable should focus on the purpose and outcome of the transaction, that is, the substance of the transaction rather than the legal mechanism to effect the transaction.

Schemes of arrangement pursuant to Section 411 can encompass a wide range of transactions. Accordingly, 'in the best interests' must be capable of a broad interpretation to meet the particular circumstances of each transaction. This involves a judgment on the part of the expert as to the overall

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commercial effect of the transaction, the circumstances that have led to the transaction and the alternatives available. The expert must weigh up the advantages and disadvantages of the proposed transaction and form an overall view as to whether shareholders are likely to be better off if the proposed transaction is implemented than if it is not. This assessment is the same as that required for a 'fair and reasonable' assessment in the case of a takeover. If the expert would conclude that a proposal was 'fair and reasonable'; if it was in the form of a takeover bid, the expert will also be able to conclude that the scheme is in the best interests of shareholders. An opinion of 'in the best interests' does not imply the best possible outcome for shareholders.

3.3 Adopted basis of evaluation

RG 111 states that a transaction is fair if the value of the offer price or consideration is equal to or greater than the value of the securities subject of the offer. This comparison should be made assuming a knowledgeable and willing, but not anxious, buyer and a knowledgeable and willing, but not anxious, seller acting at arm's length. Further to this, RG 111 states that a transaction is reasonable if it is fair. It might also be reasonable if despite being 'not fair' the expert believes that there are sufficient reasons for security holders to accept the offer in the absence of any higher bid.

Having regard to the above, BDO has completed this comparison in three parts:

• A comparison between the value of a Webcentral share including a premium for control and the Scheme Consideration (fairness - see Section 12 'Is the Scheme Fair?');
• An investigation into other significant factors to which Shareholders might give consideration, prior to approving the Scheme, after reference to the value derived above (reasonableness - see Section 13 'Is the Scheme Reasonable?'); and
• A consideration of whether the Scheme is in the best interests of Shareholders.

RG 111 states that if a transaction is fair and reasonable then the expert can conclude that the transaction is in the best interests of shareholders; if a transaction is not fair but reasonable an expert can still conclude that the transaction is in the best interests of shareholders; if a transaction is neither fair nor reasonable then the expert would conclude that the transaction is not in the best interests of shareholders.

This assignment is a Valuation Engagement as defined by Accounting Professional & Ethical Standards Board professional standard APES 225 'Valuation Services' ('APES 225').

A Valuation Engagement is defined by APES 225 as follows:

'an Engagement or Assignment to perform a Valuation and provide a Valuation Report where the Valuer is free to employ the Valuation Approaches, Valuation Methods, and Valuation Procedures that a reasonable and informed third party would perform taking into consideration all the specific facts and circumstances of the Engagement or Assignment available to the Valuer at that time.'

This Valuation Engagement has been undertaken in accordance with the requirements set out in APES 225.

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4. Outline of the Scheme

On 13 July 2020, Webcentral announced that it had executed a SID with Web.com, under which Web.com will acquire the entire issued capital of Webcentral by way of a scheme of arrangement under the Corporations Act. Under the Scheme, Webcentral shareholders will be entitled to Scheme Consideration of $0.10 in cash for every Webcentral share they hold.

The Scheme is subject to certain conditions precedent, including:

• FIRB approval;
• Webcentral Shareholders' approval of the Scheme by the requisite majority of Webcentral Shareholders;
• The independent expert issuing an independent expert's report concluding the Scheme is in the best interests of Webcentral Shareholders and not changing its conclusion or withdrawing such report;
• Australian regulatory approval, including Court approval in accordance with section 411(4)(b) of the Corporations Act;
• That either party is not subject to any restraining orders, injunctions or decisions that would affect the Scheme;
• No 'material adverse change' or 'prescribed occurrence' occurring before the Second Court Date;
• Both Webcentral and Web.com's representations are true and correct; and
• That Webcentral's ongoing customer dispute must be settled or finally determined, with all avenues of appeal finally determined.
  oThis dispute relates to a customer disputing the calculation of amounts being charged in relation to a contract for services, of which the services are still ongoing ('Customer Dispute'). As at 31 December 2019, an amount of $10,006,000 was on Webcentral's balance sheet in relation to this dispute.
  oThe SID contains a potential value sharing arrangement in relation to any proceeds received upon the settlement or final determination of the Customer Dispute. As described in section 11, in assessing the Scheme, we have assumed that this will not result in Shareholders receiving any additional consideration for their shares.

In the event that the Scheme is terminated, a cash fee of $0.5 million may be payable to Web.com

('Reimbursement Fee'). Further details of this Reimbursement Fee and other terms of the Scheme can be found in the Scheme Booklet.

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5. Profile of Webcentral

5.1 Company Background

Webcentral (previously named Melbourne IT Group and Arq Group), is an Australian full-service digital services partner for small and medium businesses ('SMB'). Webcentral's service offering ranges from domain name registrations and renewals, website and email hosting, website development, search engine marketing and social advertising campaigns for SMBs in Australia and New Zealand.

Founded in 1996 as Melbourne IT, Melbourne IT primarily provided solutions in the domains and hosting market and grew to be the leading domain name registrar in Australia, prior to listing on the ASX in 1999. Following Melbourne IT's acquisition of Webcentral, Netregistry, UberGlobal, InfoReady and Outware, the Company evolved into Arq Group. As a result of these acquisitions, Arq Group's service offering expanded into enterprise cloud, mobile app and data analytics solutions.

In May 2017, Arq Group fully acquired Web Marketing Experts Pty Ltd, Nothing But Web Pty Ltd and Results First Ltd ('WME'). In July 2019, Arq completed the divestment of the TPP Wholesale Reseller business ('TPP Wholesale') to CentralNic Group Plc ('CentralNic'). TPP Wholesale was part of the non-core SMB operations and the transaction was considered the second stage of the reseller divestment process, following the divestment of the International Domain Name Reseller ('DNR') business in March 2016.

In March 2020, as part of Arq Group's strategic review, Arq Group finalised its divestment of its Enterprise division to a consortium comprising Quadrant Private Equity ('Quadrant') and certain members of the Enterprise management team for $35 million. Following the decoupling, Arq Group continued to execute on its strategic review by announcing that Arq Group was to be rebranded to Webcentral Group. As a result of the divestment, Webcentral is now focused on its SMB business with the vision of being the most impactful digital marketing partner in Australia.

Webcentral currently has a market presence in Australia and New Zealand. Webcentral is headquartered in Melbourne, Australia and listed on the ASX in 1999.

The current directors and senior management of Webcentral are:

• Mr. Andrew Reitzer - Chairman andNon-Executive Director;
• Mr. Brett Fenton - Chief Executive Officer;
• Mr. Karl Siegling -Non-Executive Director;
• Mr. Andrew Macpherson -Non-Executive Director; and
• Mr. Brendan White - Chief Financial Officer.

Mr Larry Bloch resigned as a Non-Executive Director effective 16 August 2020

5.2 Products

Webcentral offers a suite of products and services that individuals or SMBs can utilise to build and grow their online presence. Webcentral services two core SMB market segments through different brands and product portfolios. The foundations portfolio serviced by the Netregistry and Melbourne IT brands represent the value proposition of 'Get Online' which includes domain names, web and email hosting and basic web site builds. The digital portfolio serviced by the WME brand represents the value proposition of

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'Succeed Online' and includes a full suite of digital marketing products (Pay per Click, Social and Search Engine Optimisation) and more complex website builds and enhancements.

Domains

A domain name is the first step in establishing an online presence. An effective domain name is integral to growing an online presence by promoting the business' service offering whilst protecting their brand on the internet. Domains revenue primarily consists of domain registrations and renewals, as well as aftermarket sales. Domain registrations are assessed as a distinct service that provides a customer with the exclusive use of the domain name over the contracted period, including the provision of Domain Name System services.

Website Hosting

Once customers have a domain name, the next step customers often take is securing a web hosting service that will provide the physical storage location for the domain name. Webcentral offers hosting plans including cPanel hosting, VPS hosting which are suitable solutions for blogs, personal websites and small businesses. Webcentral's hosting revenue primarily derives from website and email hosting services provided over a contracted period of time.

Digital Marketing

Digital marketing is the component of marketing that utilises internet and online based digital technologies such as desktop computers, mobile phones and other digital media and platforms to promote products and services. As digital platforms become increasingly incorporated into marketing strategies, and as people increasingly use digital devices in their everyday lives, digital marketing campaigns have become prevalent, employing combinations of search engine optimisation ('SEO'), search engine marketing, content marketing, e-commerce marketing, e-mail direct marketing.

Online marketing is a form of marketing and advertising which uses the internet to deliver promotional marketing messages to consumers. Like other advertising media, online advertising frequently involves a publisher, who integrates advertisements into its online content, and an advertiser, who provides the advertisements to be displayed on the publisher's content.

Webcentral's online marketing revenue consists of SEO, pay-per-click ('PPC') advertising, and social media advertising. SEO is the process of ranking high on a search engine in the unpaid section, also known as organic listings. Webcentral has partnerships with both Google and Microsoft, allowing the Company to provide online marketing solutions for both Google and Bing search engines.

Website Build

Webcentral's website build offering provides customers with the option of either a 'Do It Yourself' service in which the customer can gain access to a range of website templates to build a unique website, or a 'Done For You' service in which the Webcentral team creates and builds the website for the customer. Website build revenues consist of fees charged for the creation of websites for customers.

5.3 Webcentral's Brands

Webcentral comprises of the following brands:

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• Netregistry Pty Ltd ('Netregistry');
• WME Group Pty Ltd ('WME');
• Melbourne IT; and
• Domainz Limited ('Domainz').

5.4 Australian and New Zealand Bank and National Australia Bank Finance Facility

Webcentral's current debt facilities with Australia New Zealand Banking Group Limited ('ANZ') and National Australia Bank ('NAB') were originally entered into in June 2018 ('Existing Debt Facilities') to replace the previous debt facilities available to Webcentral. The Existing Debt Facilities were established to replace the previous debt facilities of $142 million.

In December 2019, Webcentral, ANZ and NAB revised the terms of the Existing Debt Facilities as a result of financial covenant breaches in the quarter ended September 2019 and certain anticipated (but later realised) financial covenant breaches (in the quarter ended 31 December 2019). The revised Existing Debt Facilities provide Webcentral with access to:

• committed funding of $61.2 million; and
• uncommitted funding of $7.5 million.

ANZ and NAB imposed certain conditions as part of the revision of the Existing Debt Facilities including (amongst other things):

• inserting a review event, to be tested on 31 January 2020; and
• requiring Webcentral to grant certain security over its assets to ANZ and NAB.

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