Frugl : Share Purchase Plan

For personal use only

7 February 2022

Dear Shareholder,

Invitation to Participate in Share Purchase Plan

On 31 January 2022, Frugl Group Limited (ACN 096 870 978) (Frugl or the Company) announced that it will be conducting a capital raising by way of Share Purchase Plan (Plan) to issue up to 54,000,000 fully paid ordinary shares (Shares) at a price of $0.02 per Share to Eligible Shareholders (defined below), to raise up to $1,080,000 under the Plan.

In order to provide Eligible Shareholders with the ability to participate in the Company's capital raising activities, the Company is pleased to provide details of the Plan. The offer under the Plan (Offer) will raise a maximum of $1,080,000 on the terms and conditions (Terms and Conditions) contained in this letter.

Shareholders Eligible to Participate in the Plan

Participation under the Plan is optional and is available exclusively to shareholders of the Company who are registered as holders of Shares at 5:00pm (WST) on 28 January 2022 (Record Date) and whose registered address is in Australia or New Zealand (Eligible Shareholders).

Share Purchase Plan

The Plan entitles Eligible Shareholders, irrespective of the size of their shareholding, to purchase up to $30,000 worth of Shares at an issue price of $0.02 per Share (Price). The Price represents a discount of 20% to $0.0247 (being the volume weighted average market price) (VWAP) of the Shares over the last 5 trading days on which sales in the Shares were recorded before the day on which the Plan was announced.

Whilst the Company intends to raise $1,080,000 under the Plan, the Company reserves the right to accept additional applications subject to shareholder demand. However, the maximum number of Shares which can be issued under the Plan is limited by the ASX Listing Rules to a maximum of 54,000,000 Shares, which is equal to 30% of the Company's existing issued share capital.

Depending on applications received, the Company may, in its absolute discretion, undertake a scale back so that not more than $1,080,000 is raised under the Plan or not more than 30% of that number of Shares already on issue, are issued under the Plan. Scale back decisions are made by the Board and are final. The Plan will not be underwritten.

An application form for the Plan (Application Form) is included in this package.

Current Activities

Details of the Company's current activities are set out in the announcements made by the Company to the ASX and are available from the ASX, or the Company's website at www.fruglgroup.com.au

The funds raised under the Plan will be used for marketing of the Frugl Grocery mobile comparison and wellness app, commercialisation of the InFocus Analytics retail intelligence SaaS platform and general working capital purposes, as well as for payment of costs associated with the Plan, further details of which are set out in the Company's announcement of 31 January 2022.

ACN: 096 870 978 T: 08 6489 1600 F: 08 6489 1601 E:[e-mail]:www.fruglgroup.com.au

Suite 9, 330 Churchill Avenue, Subiaco WA 6008

For personal use only

How much can you invest?

Eligible Shareholders may each apply for a maximum of $30,000 worth of Shares and a minimum of $2,000 worth of Shares under the Plan.

How to accept this Offer

To apply for Shares under the Plan, please follow the instructions on the enclosed personalised Application Form.

Eligible Shareholders may participate by selecting only one of the following offers to purchase Shares under the Plan:

	Total amount payable	Number of Shares which may be
		purchased
Offer A	$30,000	1,500,000
Offer B	$25,000	1,250,000
Offer C	$20,000	1,000,000
Offer D	$15,000	750,000
Offer E	$10,000	500,000
Offer F	$5,000	250,000
Offer G	$2,000	100,000

The number of Shares to which you are entitled will be calculated by dividing the subscription amount you have selected by the Price, rounded down.

Once an application has been made it cannot be revoked. All Application Forms must be received by the Closing Date of 5.00pm (AWST), Friday, 18 February 2022. If the exact amount of money is not tendered with your application, the Company reserves the right to either:

1. return your Application Form and/or payment and not issue any Shares to you; or
2. issue to you the number of Shares that would have been issued had you applied for the highest designated amount that is less than the amount of your payment and refund the excess application money to you by cheque as soon as possible, without interest.

Multiple Holdings

The maximum investment any Eligible Shareholder may apply for will remain $30,000 even if an Eligible Shareholder receives more than one Offer (whether in respect of a joint holding or because the Eligible Shareholder has more than one holding under a separate account). It is the responsibility of the applicant to ensure that the aggregate of the application price paid for the Shares the subject of the application and any other shares and interests in the class applied for by you under the Plan or any similar arrangement in the 12 months prior to the date of submission does not exceed $30,000.

Custodians and Nominees

Eligible Shareholders who hold Shares as Custodian or Nominee (Custodian) for one or more persons on the Record Date (Beneficiary) may apply for up to a maximum amount of $30,000

ACN: 096 870 978 T: 08 6489 1600 F: 08 6489 1601 E:[e-mail]:www.fruglgroup.com.au

Suite 9, 330 Churchill Avenue, Subiaco WA 6008

For personal use only

worth of Shares in respect of each Beneficiary who is resident in Australia or New Zealand, subject to providing a Custodian Certificate to the Company, as described in the Terms and Conditions enclosed with this letter. Please refer to the Terms and Conditions for more details.

Relationship of Issue Price with Market Price

On the last trading day immediately prior to the announcement date of the Offer, the closing price of the Shares traded on ASX was $0.026. The market price of Shares in the Company may rise and fall between the date of the Offer and the date that any Shares are issued to you as a result of your application under this Offer.

By making an application under this Offer and applying for Shares under the Plan, each Eligible Shareholder will be acknowledging that although the Price is at a discount, Shares are a speculative investment and the price of Shares on ASX may change between the date of the Company announcing its intention to make an Offer and the date of issue of Shares under that Offer and that the value of the Shares received under the Plan may rise or fall accordingly.

The Board recommends that you obtain your own financial and taxation advice in relation to the Offer and consider price movements of Shares in the Company prior to making an application under this Offer.

Additional Information and Important Dates

The offer of Shares under the Plan is made in accordance with ASIC Corporations (Share and Interest Purchase Plans) Instrument 2019/547 and therefore does not require a prospectus for the purposes of Chapter 6D of the Corporations Act 2001 (Cth) (Corporations Act).

The Offer cannot be transferred, and the Directors of the Company reserve the right in their absolute discretion to reject, or scale back, on an equitable basis, any application. Shares issued under the Plan will be issued no later than 7 business days after the Closing Date of the Offer. Application for quotation on ASX of the new Shares will be made immediately following the issue of those Shares.

The maximum amount proposed to be raised under the Offer is $1,080,000. The Company, however, reserves absolute discretion regarding the final amount raised under the Offer, subject to the ASX Listing Rules.

In the event of oversubscription by the Closing Date the Directors may, in their absolute discretion, scale-back applications on an equitable basis. Scale-back for Shares held by Custodians will be applied at the level of the underlying Beneficiary. Directors may also, in their absolute discretion, decide to increase acceptances in the event of oversubscriptions. If the Company rejects or scales-back an application or purported application, the Company will promptly return to the shareholder the relevant application monies, without interest.

Foreign offer restrictions

This document may not be released or distributed in any country other than Australia and New Zealand. This document does not constitute an offer to sell, or a solicitation of an offer to buy, securities in any other country. In particular, any securities described in this document have not been, and will not be, registered under the US Securities Act of 1933 (as amended) and may not be offered or sold in the United States except in transactions exempt from, or not subject to, registration under the US Securities Act and applicable US state securities laws.

ACN: 096 870 978 T: 08 6489 1600 F: 08 6489 1601 E:[e-mail]:www.fruglgroup.com.au

Suite 9, 330 Churchill Avenue, Subiaco WA 6008

For personal use only

New Zealand Shareholders

The Shares offered under the Plan are not being offered or sold to the public within New Zealand other than to existing shareholders of the Company with registered addresses in New Zealand and to whom the Offer is being made in reliance on the Financial Markets Conduct (Incidental Offers) Exemption Notice 2016 (as amended) (New Zealand).

This document has not been registered, filed with or approved by any New Zealand regulatory authority under the Financial Markets Conduct Act 2013 (New Zealand). This document is not an investment statement or prospectus under New Zealand law and is not required to, and may not, contain all the information that an investment statement or prospectus under New Zealand law is required to contain.

Plan Shortfall

In the event that less than $1,080,000 is applied for under the Plan, the Company may place the shortfall up to the maximum raise of $1,080,000 pursuant to the Company's capacity under ASX Listing Rules 7.1 or 7.1A to enable it to do so. Where more than $1,080,000 is applied for under the Plan, the Company may place any shortfall at the Price at any time during the period of 3 months following the close of the Offer (subject to the Company having capacity to do so under ASX Listing Rules 7.1 or 7.1A at the relevant time).

Indicative Timetable

Event	Date
Record Date for SPP	28 January 2022
Announcement of SPP	31 January 2022
Dispatch SPP Offer Letter to shareholders and release Offer Letter on the ASX	07 February 2022
Opening Date for SPP	08 February 2022
Closing Date for SPP	18 February 2022
Announcement of results of SPP	22 February 2022
SPP Issue date of securities	24 February 2022
Normal Trading of SPP securities	25 February 2022
Dispatch of SPP Holding Statements	28 February 2022

These dates are indicative only. The Company may vary the dates and times of the Offer without notice. Accordingly, shareholders are encouraged to submit their Application Forms as early as possible.

Should you wish to discuss any information contained in this letter further, do not hesitate to contact Frugl's Company Secretary, Sonu Cheema on [phone] or email [e-mail].

Yours faithfully

Mathew Walker

Director

Frugl Group Limited

ACN: 096 870 978 T: 08 6489 1600 F: 08 6489 1601 E:[e-mail]:www.fruglgroup.com.au

Suite 9, 330 Churchill Avenue, Subiaco WA 6008

For personal use only

Frugl Group Limited ACN 096 870 978

Share Purchase Plan - Terms and Conditions

Purpose

The purpose of the Share Purchase Plan (the Plan) is to offer shareholders of Frugl Group Limited (Frugl or the Company) the opportunity to acquire additional fully paid ordinary shares in the Company (Shares) up to a maximum of $30,000 (when combined with any shares issued under any share purchase plan in the 12 months preceding the date of the Plan) and a minimum of $2,000 worth of Shares.

The issue price of $0.02 under the Plan will be at a discount of 20% to the volume weighted average market price of the Shares over the last 5 trading days on which sales in the Shares were recorded on the financial market operated by ASX Limited (ASX) before the day on which the Plan was announced which was $0.0247.

The Company seeks to raise a maximum of $1,080,000 under the Plan. The Shares will also be issued without the need to pay brokerage costs and without the need for the Company to issue a prospectus. The Plan is governed upon such terms and conditions as the board of directors of the Company, in its absolute discretion, sees fit.

No Financial Advice

This document does not provide financial advice and has been prepared without taking account of any person's investment objectives, financial situation or particular needs. You should consider the appropriateness of participating in the Plan having regard to your investment objectives, financial situation or particular needs. Shareholders should seek independent financial and taxation advice before making any investment decision in relation to these matters.

Shareholders Eligible to Participate

Holders of Shares that are registered with an Australian or New Zealand address at the Record Date are eligible shareholders (Eligible Shareholders) and may participate in the Plan, unless such registered shareholder holds Shares on behalf of another person who resides outside Australia or New Zealand. Due to foreign securities laws, it is not practical for shareholders (or beneficial shareholders) resident in other countries to be offered the opportunity to participate in the Plan.

Participation in the Plan is optional and is subject to these Terms and Conditions. Offers made under the Plan are non-renounceable (i.e. Eligible Shareholders may not transfer their rights to any Shares offered under the Plan). Eligible Shareholders who wish to take up Shares issued under the Plan agree to be bound by the Company's constitution in respect of Shares issued under the Plan.

An offer may, at the discretion of the directors of the Company (Directors), be made under the Plan once a year. The maximum amount which any shareholder may subscribe for in any consecutive 12-month period is $30,000. The Directors may also determine in their discretion the minimum amount for participation, the multiple of Shares to be offered under the Plan and the period the offer is available to Eligible Shareholders.

ACN: 096 870 978 T: 08 6489 1600 F: 08 6489 1601 E:[e-mail]:www.fruglgroup.com.au

Suite 9, 330 Churchill Avenue, Subiaco WA 6008