Lionhub : Appendix 3B - $115k Convertible Notes

Appendix 3B

New issue announcement

Rule 2.7, 3.10.3, 3.10.4, 3.10.5

Appendix 3B

New issue announcement, application for quotation of additional securities and agreement

Information or documents not available now must be given to ASX as soon as available. Information and documents given to ASX become ASX's property and may be made public.

Introduced 01/07/96 Origin: Appendix 5 Amended 01/07/98, 01/09/99, 01/07/00, 30/09/01, 11/03/02, 01/01/03, 24/10/05, 01/08/12, 04/03/13

Name of entity

LIONHUB GROUP LIMITED

ABN 29 119 999 441

We (the entity) give ASX the following information.

Part 1 - All issues

You must complete the relevant sections (attach sheets if there is not enough space).

• 1 +Class of +securities issued or to be issued

  Class A Convertible Notes

• 2 Number of +securities issued or to be issued (if known) or maximum number which may be issued

2,300,000 Class A Notes

N-5405863:1 + See chapter 19 for defined terms.

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3

Principal terms of the +securities (e.g. if options, exercise price and expiry date; if partly paid +securities, the amount outstanding and due dates for payment; if +convertible securities, the conversion price and dates for conversion)

The following terms and conditions apply to the Class A Notes:

• (a) Each Note will have a face value of $0.05;

• (b) Notes are unsecured;

• (c) Notes have a term of 5 years or 9 months from the date of issue if shareholder approval is not obtained;

• (d) Class A Notes pay interest at 9% pa payable at the end of each quarter and on conversion or redemption;

• (e) LHB shall have the right to redeem the Notes at any time after 30 months following the date of issue, subject to giving each Noteholder not less than 21 day's notice in writing.

• (f) Subject to shareholder approval, the face value of the Notes together with any accrued but unpaid interest (net of any withholding tax) will be converted at 80% of the volume weighted average price of LHB's ordinary shares over the 15 trading days prior to the date of conversion at the option of each noteholder in multiples of 50,000 at any time during the term;

• (g) LHB will obtain shareholder approval to the convertibility of the Notes as soon as practicable following their issuance.

• (h) The Notes will be repayable on demand following the occurrence of an event of default;

• (i) LHB will deduct interest withholding tax on interest amounts where applicable;

• (j) The convertibility of the Notes is conditional on shareholder approval within three months of the date of issue;

• (k) The Notes will be repaid after nine months from the date of issue if shareholder approval has not been obtained to the convertibility of the Note

N-5405863:1 + See chapter 19 for defined terms.

• 4 Do the +securities rank equally in all respects from the +issue date with an existing +class of quoted +securities?

  If the additional +securities do not rank equally, please state:

  • • the date from which they do

  • • the extent to which they participate for the next dividend, (in the case of a trust, distribution) or interest payment

  • • the extent to which they do not rank equally, other than in relation to the next dividend, distribution or interest payment

• 5 Issue price or consideration

  NoClass A - $0.05 per Note

• 6 Purpose of the issue

  (If issued as consideration for the acquisition of assets, clearly identify those assets)

• 6a Is the entity an +eligible entity that has obtained security holder approval under rule 7.1A?

  If Yes, complete sections 6b - 6h

  in relation to the +securities the

  subject of this Appendix 3B, and

  comply with section 6i

• 6b The date the security holder resolution under rule 7.1A was passed

• 6c Number of +securities issued without security holder approval under rule 7.1

Ongoing Working CapitalNo

N-5405863:1 + See chapter 19 for defined terms.

• 6d Number of +securities issued

  with security holder approval

  under rule 7.1A

• 6e Number of +securities issued with security holder approval under rule 7.3, or another specific security holder approval (specify date of meeting)

• 6f Number of +securities issued under an exception in rule 7.2

• 6g If +securities issued under rule 7.1A, was issue price at least 75% of 15 day VWAP as calculated under rule 7.1A.3? Include the +issue date and both values. Include the source of the VWAP calculation.

• 6h If +securities were issued under rule 7.1A for non-cash consideration, state date on which valuation of consideration was released to ASX Market Announcements

• 6i Calculate the entity's remaining issue capacity under rule 7.1 and rule 7.1A - complete Annexure 1 and release to ASX Market Announcements

• 7 +Issue dates

  8 March 2019

  Note: The issue date may be prescribed by ASX (refer to the definition of issue date in rule 19.12). For example, the issue date for a pro rata entitlement issue must comply with the applicable timetable in Appendix 7A.

  Cross reference: item 33 of Appendix 3B.

N-5405863:1 + See chapter 19 for defined terms.

Appendix 3B

New issue announcement

• 8 Number and +class of all +securities quoted on ASX (including the +securities in section 2 if applicable)

• 9 Number and +class of all +securities not quoted on ASX (including the +securities in section 2 if applicable)

  Number	+Class
  826,349,731 21,903,698	Ordinary Options exercisable at $0.22 exp 4 Dec 2020
  Number	+Class
  33,000,000 4,000,000	Class A Convertible Notes: 5 year term, Interest 9% pa payable at the end of each quarter and on conversion redemption,orconversion at 80% of 15 day VWAP. Class B Notes 5 year term, Interest 13.8% pa payable on conversion redemption,orconversion at 80% of 15 day VWAP.

• 10 Dividend policy (in the case of a trust, distribution policy) on the increased capital (interests)

Part 2 - Pro rata issue

• 11 Is security required?

  holderapproval

• 12 Is the issue renounceable or non-renounceable?

• 13 Ratio in which the +securities will be offered

• 14 +Class of +securities to which the offer relates

• 15 +Record date to determine entitlements

N/A

N-5405863:1 + See chapter 19 for defined terms.

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