EX-10.21






 Exhibit 10.21 

 
 



 
 Shareholders Agreement 

Security Matters Limited 
 ACN 626
192 998 
 and 
 W.A. Mint Pty.
Ltd. 
 ACN 054 024 314 
 True Gold
Consortium Pty Ltd 
 ACN 641 483 374 

27 July 2020 
 K&L Gates

 Melbourne office 
 Ref:
7392718.00001 













 Table of Contents     

 

							
	1.	 	Defined terms and interpretation	  	 	5	 
	1.1	 	Defined terms	  	 	5	 
	1.2	 	Interpretation	  	 	11	 
	1.3	 	Construction	  	 	12	 
			
	2.	 	Company’s objectives	  	 	12	 
			
	3.	 	Shareholders’ relationship	  	 	12	 
	3.1	 	Shareholder not liable for another party	  	 	12	 
	3.2	 	Relationship between Shareholders	  	 	12	 
	3.3	 	Authority of Shareholders	  	 	12	 
	3.4	 	Shareholders must act in good faith	  	 	13	 
			
	4.	 	Shareholder obligations	  	 	13	 
			
	5.	 	Board composition and proceedings	  	 	13	 
	5.1	 	Board composition	  	 	13	 
	5.2	 	Directors’ fees and expenses	  	 	13	 
	5.3	 	Company secretary	  	 	13	 
	5.4	 	Directors and officers’ insurance	  	 	13	 
			
	6.	 	Management of the Company	  	 	14	 
			
	7.	 	Decisions	  	 	14	 
	7.1	 	Directors Special Resolutions	  	 	14	 
	7.2	 	Shareholders Special Resolutions	  	 	14	 
	7.3	 	Other consents required	  	 	14	 
			
	8.	 	Things the Company must do	  	 	14	 
	8.1	 	Company’s obligation	  	 	14	 
	8.2	 	Shareholders’ obligations	  	 	14	 
			
	9.	 	Business plan	  	 	15	 
	9.1	 	Initial Business Plan	  	 	15	 
	9.2	 	Current Business Plan	  	 	15	 
	9.3	 	New Business Plans	  	 	15	 
	9.4	 	Previous Business Plans	  	 	15	 
			
	10.	 	Financial and other reporting	  	 	15	 
	10.1	 	Reports and information	  	 	15	 
	10.2	 	Confidentiality	  	 	15	 
			
	11.	 	Accounts and records	  	 	15	 
	11.1	 	Keeping records and accounts	  	 	15	 
	11.2	 	Access	  	 	16	 
	11.3	 	Notice requesting access	  	 	16	 
	11.4	 	Copying of books and records	  	 	16	 
	11.5	 	Confidentiality	  	 	16	 
	11.6	 	Disclosure of information by directors	  	 	16	 















 Table of Contents (ctd) 
  

 


							
	12.	 	Class B Shares	  	 	16	 
			
	13.	 	Dividend policy	  	 	16	 
	13.1	 	Dividend policy	  	 	16	 
			
	14.	 	Funding	  	 	16	 
	14.1	 	In-Kind Contributions	  	 	16	 
	14.2	 	Initial In-Kind Contributions and working capital	  	 	17	 
	14.3	 	No obligation	  	 	17	 
	14.4	 	Further funding	  	 	17	 
			
	15.	 	Issue of Equity Securities	  	 	17	 
	15.1	 	Issue of Equity Securities	  	 	17	 
	15.2	 	No obligation to subscribe for Equity Securities	  	 	17	 
	15.3	 	Procedure for issue of Equity Securities	  	 	17	 
	15.4	 	Equity Offer	  	 	17	 
	15.5	 	Subscription Notice	  	 	18	 
	15.6	 	Response to Offer	  	 	18	 
	15.7	 	Failure to respond	  	 	18	 
	15.8	 	Disposal to other Shareholders	  	 	18	 
			
	16.	 	Transferring Equity Securities	  	 	18	 
	16.1	 	Procedure	  	 	18	 
	16.2	 	Transfer Notice	  	 	18	 
	16.3	 	Response to Transfer Notice	  	 	19	 
	16.4	 	Purchase of other Shareholders Sale Securities	  	 	19	 
	16.5	 	If other Shareholders agree to buy Sale Securities	  	 	19	 
	16.6	 	If other Shareholder does not agree to buy Sale Securities	  	 	19	 
	16.7	 	Completion of sale	  	 	20	 
	16.8	 	No revocation	  	 	20	 
	16.9	 	Permitted Transfers	  	 	20	 
	16.10	 	Affiliate no longer an Affiliate	  	 	20	 
			
	17.	 	Tag Along	  	 	20	 
	17.1	 	Tag along or last right of refusal	  	 	20	 
	17.2	 	If Offeree gives Tag Along Notice	  	 	21	 
			
	18.	 	Drag Along	  	 	21	 
	18.1	 	Drag Along Option	  	 	21	 
	18.2	 	Restrictions on Drag Along Option	  	 	21	 
	18.3	 	Drag Along Notice	  	 	21	 
	18.4	 	Exercise of the Drag Along Option	  	 	22	 
	18.5	 	Completion	  	 	22	 
			
	19.	 	Encumbering Equity Securities	  	 	22	 
			
	20.	 	Deed of accession	  	 	22	 
	20.1	 	If Equity Securities are issued	  	 	22	 
	20.2	 	If Equity Securities are transferred	  	 	22	 
	20.3	 	Competitors	  	 	22	 
			
	21.	 	Sale of share capital	  	 	23	 
	21.1	 	Third party offer	  	 	23	 
	21.2	 	Waiver of Transfer Notice Requirement	  	 	23	 


  
 2 















 Table of Contents (ctd) 
  

 


							
	21.3	 	Settlement	  	 	23	 
			
	22.	 	Liquidation event	  	 	23	 
	22.1	 	Board to consider status of Consortium	  	 	23	 
	22.2	 	Appointment of Financial Adviser	  	 	24	 
	22.3	 	Shareholders to decide	  	 	24	 
	22.4	 	Parties to cooperate on a liquidity event	  	 	24	 
	22.5	 	Winding up	  	 	24	 
			
	23.	 	Default	  	 	24	 
	23.1	 	Events of default	  	 	24	 
	23.2	 	Consequence of default	  	 	25	 
	23.3	 	Independent valuation	  	 	25	 
	23.4	 	Procedure for Transfer	  	 	25	 
	23.5	 	Notice to Sell	  	 	25	 
	23.6	 	Each Shareholder must offer to buy other Shareholders Equity Securities	  	 	26	 
	23.7	 	Non-Defaulting Party must decide to buy or sell	  	 	26	 
	23.8	 	Notice of decision	  	 	26	 
	23.9	 	Completion of sale of Equity Securities	  	 	26	 
	23.10	 	Other remedies	  	 	26	 
			
	24.	 	Resolution of disputes	  	 	27	 
	24.1	 	Procedure for Resolving Disputes	  	 	27	 
	24.2	 	Negotiation	  	 	27	 
	24.3	 	Costs	  	 	28	 
			
	25.	 	Deadlock	  	 	28	 
	25.1	 	When a deadlock arises	  	 	28	 
	25.2	 	Deadlock Notice	  	 	28	 
	25.3	 	Actions Pending Resolution of Deadlock	  	 	28	 
			
	26.	 	Warranties regarding capacity and status	  	 	28	 
			
	27.	 	Trustees	  	 	29	 
			
	28.	 	Confidentiality and announcements	  	 	29	 
	28.1	 	Confidentiality obligations	  	 	29	 
	28.2	 	Announcements	  	 	29	 
	28.3	 	Exceptions	  	 	30	 
	28.4	 	Commercially sensitive information	  	 	30	 
			
	29.	 	Termination	  	 	30	 
	29.1	 	Termination for all parties	  	 	30	 
	29.2	 	Termination for a Shareholder	  	 	30	 
	29.3	 	Accrued rights	  	 	30	 
			
	30.	 	Paramountcy	  	 	30	 
			
	31.	 	GST	  	 	31	 
	31.1	 	Interpretation	  	 	31	 
	31.2	 	GST gross up	  	 	31	 
	31.3	 	Reimbursements	  	 	31	 
	31.4	 	Tax invoice	  	 	31	 


  
 3 















 Table of Contents (ctd) 
  

 


					
	32.	 	General provisions	  	31
	32.1	 	Entire agreement	  	31
	32.2	 	Variation	  	31
	32.3	 	Waiver	  	31
	32.4	 	Further assurances	  	32
	32.5	 	Approvals and consents	  	32
	32.6	 	Assignment	  	32
	32.7	 	Time for doing acts	  	32
	32.8	 	Governing law and jurisdiction	  	32
	32.9	 	Severance	  	32
	32.10	 	Preservation of existing rights	  	32
	32.11	 	No merger	  	33
	32.12	 	Relationship of parties	  	33
	32.13	 	Costs	  	33
	32.14	 	Stamp Duty	  	33
	32.15	 	Survival	  	33
	32.16	 	Notices	  	33
	32.1	 	Counterparts	  	34
		
	Schedule 1 – Share Capital	  	35
		
	Schedule 2 – Board	  	36
		
	Schedule 3 – Directors Special Resolutions	  	41
		
	Schedule 4 – Shareholders Special Resolutions	  	43
		
	Schedule 5 – Financial and other reporting requirements	  	45
		
	Schedule 6 – Things the Company must do	  	47
		
	Schedule 7 – Deed of Accession	  	48
		
	Schedule 8 – Independent Valuation	  	49
		
	Schedule 9 - Terms of the Class B Shares	  	51

  

  
 4 














 Shareholders Agreement 

Date
                                    27 July 2020 

Parties 
  

	1.	 Security Matters Limited ACN 626 192 998 of c/- K&L Gates, Level 25, 525 Collins Street,
Melbourne VIC 3000 (Security Matters) 


  

	2.	 W.A. Mint Pty. Ltd. ACN 054 024 314 of 310 Hay Street, East Perth, Western Australia 6005 (WA
Mint) 


  

	3.	 True Gold Consortium Pty Ltd ACN 641 483 374 of 51B Marlow Street, Wembley, Western Australia 6014
(Company). 


 Background 
  

	A.	 The Company was incorporated on 4 June 2020. 



 

	B.	 The issued share capital of the Company is, or immediately after execution of this document will be, as set out
in Schedule 1. 


  

	C.	 The Company’s goal is to establish an industry standard with the development of an innovative system that
can mark (at a molecular level), track and trace gold bars and gold through every stage of the supply chain with blockchain technology. 


  

	D.	 Security Matters and WA Mint have reached agreement on certain matters relating to their relationship as
holders of Equity Securities in the Company and the manner in which the direction, management, affairs and control of the Company and the Business will be conducted to be referred to as the “True Gold Consortium”. 



Agreed terms 
 It is agreed: 

 

	1.	 Defined terms and interpretation 



 

	1.1	 Defined terms 



In this agreement: 
 Accounting
Standards means: 
  

	 	(a)	 accounting standards approved under the Corporations Act and its requirements about the preparation and
contents of accounts; and 


  

	 	(b)	 generally accepted accounting principles, policies, practices and procedures in Australia.



 Affiliate means, in relation to a Shareholder: 

 

	 	(a)	 a related body corporate of the Shareholder; 



 

	 	(b)	 a company in which the Shareholder beneficially owns 50% or more of the issued shares; 



  
 5 















	 	(c)	 a trust of which the Shareholder or a Shareholder or beneficiary of the Shareholder is the beneficiary and from
which the Shareholder or a beneficiary of the Shareholder has received 50% or more of the distributions from that trust in the previous 3 years; 


  

	 	(d)	 a trust of which a related body corporate of the Shareholder or other entity under common control of the
Shareholder is the responsible entity, trustee, manager or investment adviser of the trust; 


  

	 	(e)	 a limited partnership whose general partner is a related body corporate of the Shareholder;



  

	 	(f)	 a general partnership all of whose general partners are related bodies corporate of the Shareholder;



  

	 	(g)	 if the Shareholder is a limited partnership, general partnership or a trust, a custodian of an asset or assets
of the limited partnership, general partnership or trust; or 


  

	 	(h)	 if the Shareholder is an individual, the spouse, former spouse, mother, father, brother, sister or child over
the age of 18 years of the Shareholder. 


 Associate has the meaning given to that term in the Corporations
Act. 
 Board means the board of directors of the Company as constituted from time to time. 

Board Meeting means a meeting of the Board (or any committee of the Board) convened and held in accordance with this agreement and the
Company’s constitution. 
 Board Threshold means $100,000 or such other amount as approved by a Shareholders Special Resolution.

 Business means the business described in the Initial Business Plan and any other activity carried on by the Company from time to
time. 
 Business Day means any day that is not a Saturday, Sunday, gazetted public holiday or bank holiday in Western Australia,
Australia and concludes at 5 pm on that day; 
 Business Hours means from 9 am to 5 pm on a Business Day. 

Business Plan means the current year program from time to time for carrying on the Business during the current Financial Year (and the
next Financial Years), comprising: 
  

	 	(a)	 a business plan including the proposed or projected: 



 

	 	( )	 agreed activities of the Business; 



 

	 	(ii)	 marketing plans; 


  

	 	(iii)	 sales targets; 


  

	 	(iv)	 profit and loss statement, profitability, cash flow statements and balance sheet; 



  
 6 















	 	(v)	 capital expenditure; 



 

	 	(vi)	 financing plans including proposed debt and equity funding; 



 

	 	(vii)	 staffing requirements; and 



 

	 	(viii)	 research and development plans, 



during the period; and 
  

	 	(b)	 a budget estimating the income and expenses of the Business during the period. 



CEO means the chief executive officer of the Company from time to time. 

Change in Control means, in relation to a Shareholder, that the person who Controls the Shareholder when that person first becomes a
Shareholder stops having Control. 
 Confidential Information means any of the following that is not in the public domain: 

 

	 	(a)	 information relating to a Transaction Document or any transaction contemplated by a Transaction Document;



  

	 	(b)	 all databases, source codes, methodologies, manuals, artwork, advertising manuals, trade secrets and all
financial, accounting, marketing and technical information, customer and supplier lists, know-how, technology, operating procedures and other information, used by or relating to the Group and its transactions
and affairs; 


  

	 	(c)	 all notes and reports incorporating or derived from the material referred to in paragraphs (a) or (b); and



  

	 	(d)	 all copies of the material referred to in paragraphs (a) to (c). 



Consortium means the consortium constituted by this Agreement, with the parties to this Agreement and any new parties that enter the
consortium by acceding to this Agreement from time to time. 
 Control means: 

 

	 	(a)	 in relation to a company by a person: 



 

	 	(i)	 the person determines the composition of the board of directors of the company; 



 

	 	(ii)	 the board of directors of the company is accustomed to act in accordance with the instructions, directions or
wishes of the person; or 


  

	 	(iii)	 the person holds or owns (alone or with its Associates or related bodies corporate): 



 

	 	(A)	 the majority of the issued shares of the company; 



 

	 	(B)	 the majority of the issued shares of the ultimate holding company of the company; or 



  
 7 















	 	(C)	 the majority of any securities or other rights granted by the company entitling holders to distributions based
on the profits, earnings or net liquidation proceeds of the company; and 


  

	 	(b)	 in relation to a trust by a person: 



 

	 	(i)	 the person is the sole trustee of the trust; 



 

	 	(ii)	 the composition of the board of directors of any trustee company of the trust is determined by the person;



  

	 	(iii)	 the board of directors of any trustee company of the trust is accustomed to act in accordance with the
instructions, directions or wishes of the person; or 


  

	 	(iv)	 the person holds or owns (alone or with its Associates or related bodies corporate): 



 

	 	(A)	 the majority of the issued shares of any trustee company of the trust; 



 

	 	(B)	 the majority of the issued shares of the ultimate holding company of any trustee company of the trust; or



  

	 	(C)	 the majority of the units, securities or other rights granted by the trust entitling holders to distributions
from the trust. 


 Corporations Act means the Corporations Act 2001 (Cth). 

Directors Special Resolution means a resolution of Directors carried by a majority including at least one Security Matters Director and
one WA Mint Director. 
 Deadlock means an event referred to in clause 25.1. 

Deed of Accession means a deed of accession in the form of Schedule 7. 

Director means a director of the Company from time to time. 

EBITDA means Earnings Before Interest, Tax, Depreciation, and Amortization as calculated under Australian GAAP or A-IFRS (whichever is used by the Company at the time of calculation). 
 Encumber means to a
mortgage, pledge, charge, grant a security interest over, assign as security or otherwise encumber. 
 Encumbrance includes any
mortgage, charge, pledge, lien, encumbrance, assignment, security interest, title retention, preferential right, trust arrangement, contractual right of set-off or any other security agreement or arrangement
in favour of any person by way of security for the payment of a debt or any other monetary obligation. 
 Equity Proportion in
relation to a Shareholder, means a fraction, (expressed as a percentage) the numerator of which is the total number of Shares held by the Shareholder and the denominator of which is the total number of Shares (including the Shares held by that
Shareholder): 

  
 8 















	 	(a)	 on issue; or 


  

	 	(b)	 where the reference requires something to be apportioned between a number of Shareholders, held by those
Shareholders. 


 Equity Securities means Shares and any preference shares, options, convertible notes, warrants or
other securities convertible into Shares. 
  

	 	Excluded	 Issue means: 


  


	 	(a)	 an issue of Shares in an IPO; 



 

	 	(b)	 an issue of Shares under a Reorganisation Event; 



 

	 	(c)	 an issue of Equity Securities approved by Shareholders Unanimous Decision; 



 

	 	(d)	 an issue of Shares or options exercisable into Shares pursuant to an employee share plan, employee share option
scheme or employee share purchase scheme where the plan or scheme rules and each issue or grant under them is approved by the Board as a Unanimous Directors Resolution; or 



 

	 	(e)	 an issue of Shares on conversion of convertible securities where the convertible securities were earlier issued
in accordance with this agreement. 


  

	 	Event	 of Default means any of the events set out in clause 23.1. 



 

	 	Financial	 Year means the 12 months from 1 July to 30 June, or other dates agreed by the Board.



  

	 	Group	 means the Company and its Subsidiaries from time to time. 



In-Kind Contributions means the in-kind contributions to
be provided by each of Security Matters and W.A. Mint in accordance with the Initial Business Plan (as may be varied from time to time). 
  

	 	Initial	 Business Plan means the Business Plan adopted by the Company in accordance with clause 9.1.



  

	 	Insolvency	 Event means, in relation to a person: 



 

	 	(a)	 a receiver, receiver and manager, administrator, trustee or similar official is appointed over any of the
assets or undertaking of the person; 


  

	 	(b)	 the person suspends payment of its debts generally; 



 

	 	(c)	 the person is or becomes unable to pay its debts when they are due or is unable to pay its debts within the
meaning of the Corporations Act; 


  

	 	(d)	 the person enters into or resolves to enter into any arrangement, competition or compromise with, or assignment
for the benefit of, its creditors or any class of them; 


  

	 	(e)	 an application or order is made for the winding up or dissolution of, or the appointment of a provisional
liquidator, to the person or a resolution is passed or steps are taken to pass a resolution for the winding up or dissolution of the person otherwise than for the purpose of an amalgamation or reconstruction which has the prior consent of all
Shareholders; or 



  
 9 















	 	(f)	 an administrator is appointed under the Corporations Act. 



IPO means an initial public offering of Shares made under a prospectus or similar offer document stating that the Company has or will
apply, in conjunction with the offering, for quotation of the Shares on a stock exchange. 
 Offer means the Security Matters Offer
for Gold Marking System, dated 6 April 2020, a copy of which is attached as Annexure A. 
 Relevant Interest has the
meaning given to that term in the Corporations Act. Reorganisation Event means: 
  

	 	(a)	 a bonus issue of Shares; 



 

	 	(b)	 a sub-division or consolidation of Shares; or 



 

	 	(c)	 any other reorganisation or reconstruction of the Share Capital where the Company does not pay or receive cash.



 Shareholder means a person that holds Shares and is a party to this agreement. 

Share Capital means all of the Shares on issue. 

Shares means ordinary shares in the capital of the Company. 

Shareholders Special Resolution means a resolution carried by a majority including Security Matters and WA Mint. 

Shareholders Unanimous Decision means a vote, resolution or consent passed or given by all Shareholders. 

Subsidiary means each subsidiary of the Company from time to time. Transaction Document means each of: 

 

	 	(a)	 this agreement; 


  

	 	(b)	 the Company’s constitution; 



 

	 	(c)	 any other agreements between Shareholders and the Company; and 



 

	 	(d)	 any other document that the parties agree is transaction document. 



Transfer means to sell, assign, transfer, conveyor otherwise dispose of a legal or beneficial interest. 

Unanimous Decision means: 
  

	 	(a)	 in respect of a decision made by the Directors: 



 

	 	(i)	 a resolution passed by all Directors present at the relevant meeting of Directors who may vote on the
resolution; or 



  
 10 















	 	(ii)	 a written circular resolution signed by all Directors. 



 

	 	(b)	 the Shareholders, a resolution that is passed by an affirmative vote of all of the Shareholders present and
entitled to vote on the resolution. 


  

	1.2	 Interpretation 



In this agreement, unless the context clearly indicates otherwise: 
  

	 	(a)	 a reference to this agreement or another document means this agreement or that other document and any
document which varies, supplements, replaces, assigns or novates this agreement or that other document; 


  

	 	(b)	 a reference to legislation or a legislative provision includes any statutory modification or
substitution of that legislation or legislative provision and any subordinate legislation issued under that legislation or legislative provision; 


  

	 	(c)	 a reference to a body or authority which ceases to exist is a reference to either a body or
authority that the parties agree to substitute for the named body or authority or, failing agreement, to a body or authority having substantially the same objects as the named body or authority; 



 

	 	(d)	 a reference to the introduction, a clause or schedule is a reference to the introduction,
a clause or a schedule to or of this agreement; 


  

	 	(e)	 clause headings and the table of contents are inserted for convenience only and do not form part
of this agreement; 


  

	 	(f)	 the introduction and schedules form part of this agreement; 



 

	 	(g)	 a reference to a person includes a natural person, corporation, statutory corporation, partnership, the
Crown or any other organisation or legal entity; 


  

	 	(h)	 a reference to a natural person includes their personal representatives, successors and permitted
assigns; 


  

	 	(i)	 a reference to a corporation includes its successors and permitted assigns; 



 

	 	(j)	 related or subsidiary in respect of a corporation has the same meaning given to that term in the
Corporations Act; 


  

	 	(k)	 a reference to a right or obligation of a party is a reference to a right or obligation of that party under
this agreement; 


  

	 	(l)	 an obligation or warranty on the part of 2 or more persons binds them jointly and severally and
an obligation or warranty in favour of 2 or more persons benefits them jointly and severally; 


  

	 	(m)	 a requirement to do anything includes a requirement to cause that thing to be done and a requirement not to do
anything includes a requirement to prevent that thing being done; 


  

	 	(n)	 including and includes are not words of limitation; 



  
 11 















	 	(e)	 the words at any time mean at any time and from time to time; 



 

	 	(f)	 a reference to a time is to that time in Western Australia, Australia; 



 

	 	(g)	 a word that is derived from a defined word has a corresponding meaning; 



 

	 	(h)	 monetary amounts are expressed in Australian dollars; 



 

	 	(i)	 the singular includes the plural and vice-versa; 



 

	 	(j)	 words importing one gender include all other genders; 



 

	 	(k)	 a reference to a thing includes each part of that thing; 



 

	 	(l)	 a reference to the Company includes any Subsidiary from time to time and the rights and obligations of the
parties apply to any Subsidiary; and 


  

	 	(m)	 fractions of Equity Securities are rounded down to the nearest whole number when calculating the number of
Equity Securities issued or transferred. 


  

	1.3	 Construction 



Neither this agreement nor any part of it is to be construed against a party on the basis that the party or its lawyers were responsible for
its drafting. 
  

	2.	 Company’s objectives 



The objectives of the Company are to: 
  

	 	(a)	 carry on the Business; 



 

	 	(b)	 develop and expand the Business in accordance with the Business Plan; and 



 

	 	(c)	 maximise the value of the Company. 



 

	3.	 Shareholders’ relationship 



 

	3.1	 Shareholder not liable for another party 



Each Shareholder is responsible for its obligations under this agreement and is not liable for any obligation of another party, including the
obligations of another Shareholder. 
  

	3.2	 Relationship between Shareholders 



Except where this agreement expressly states otherwise, this agreement does not create any relationship between the Shareholders under which a
Shareholder: 
  

	 	(a)	 is liable for the acts or omissions of another Shareholder; or 



 

	 	(b)	 must share profits. 


  


	3.3	 Authority of Shareholders 



A Shareholder: 

  
 12 















	 	(a)	 must not hold itself out as a partner of, or principal or agent or trustee of another Shareholder; and



  

	 	(b)	 except where this agreement expressly states otherwise, does not have authority to act for, or to create or
assume any responsibility or obligation on behalf of another Shareholder. 


  

	3.4	 Shareholders must act in good faith 



Each Shareholder must act in good faith when dealing with the other parties and otherwise act reasonably in all matters relating to the Company
and any Transaction Document. 
  

	4.	 Shareholder obligations 



Each Shareholder must: 
  

	 	(a)	 comply with this agreement; 



 

	 	(b)	 exercise its voting rights and other rights as a Shareholder (as far as it can by exercising those rights) to
give full effect to this agreement (including the objectives in clause 2) and the rights and obligations of the parties under this agreement; and 


  

	 	(c)	 ensure any Director appointed by it from time to time (subject to the Director’s fiduciary duties to the
Company) exercises their voting rights and other powers (as far as they can by exercising those rights and powers) to give full effect to this agreement (including the objectives in clause 2) and the rights and obligations of the parties under this
agreement. 


  

	5.	 Board composition and proceedings 



 

	5.1	 Board composition 



Each Shareholder must exercise its rights as a Shareholder to ensure the Board is composed, and its meetings are conducted, in accordance with
Schedule 2. 
  

	5.2	 Directors’ fees and expenses 



Directors are not entitled to remuneration from the Company in their capacity as directors, other than in accordance with a contract of
employment or other written agreement with the Company. 
  

	5.3	 Company secretary 



The company secretary is to be appointed by the Board from time to time. 

 

	5.4	 Directors and officers’ insurance 



The Company must enter into a Director’s Protection Deed for the benefit of each director appointed to the Board and the Board will
determine the appropriate insurance to be put in place for the benefit of directors. The Board will consult with an insurance broker to obtain advice on insurance. 

  
 13 















	6.	 Management of the Company 



Subject to clause 7, each Shareholder must exercise its rights as a Shareholder to ensure: 

 

	 	(a)	 management of the Company is vested in the Board; 



 

	 	(b)	 the CEO has the power and authority to manage the Company as delegated by the Board from time to time;



  

	 	(c)	 subject to the discretion of the Board, the CEO is responsible for: 



 

	 	(i)	 the day-to-day management the
Company and conduct of the Business in compliance with the Business Plan; 


  

	 	(ii)	 the general administration of the Company; 



 

	 	(iii)	 the implementation of, and compliance with, the Business Plan; and 



 

	 	(iv)	 giving the Board full information about the activities of the Company, 



subject to the Board’s supervision, lawful direction or delegation in accordance with this agreement. 

 

	7.	 Decisions 


  

	7.1	 Directors Special Resolutions 



The Company may only do, or commit to do, the things listed in Schedule 3 by Directors Special Resolution. 

 

	7.2	 Shareholders Special Resolutions 



The Company may only do, or commit to do, the things listed in Schedule 4 by Shareholders Special Resolution. 

 

	7.3	 Other consents required 



Clauses 7.1 and 7.2 are without prejudice to any other consent or approval required under the Corporations Act or the Company’s
constitution. 
  

	8.	 Things the Company must do 



 

	8.1	 Company’s obligation 



The Company must do, or cause to be done, each thing listed in Schedule 6. 

 

	8.2	 Shareholders’ obligations 



Each Shareholder must do all it can to ensure the Company does, or causes to be done, each thing listed in Schedule 6. 

  
 14 















	9.	 Business plan 



 

	9.1	 Initial Business Plan 



The Initial Business Plan is to be based on the Offer, and updated within 90 days of execution of this Agreement. 

 

	9.2	 Current Business Plan 



Each Shareholder must exercise its rights as a Shareholder to ensure the Company carries on the Business in accordance with the Business Plan.

  

	9.3	 New Business Plans 



Each Shareholder must exercise its rights as a Shareholder to ensure: 
  


	 	(a)	 at least two months before the beginning of each Financial Year, the CEO submits to the Board a draft Business
Plan for the next two Financial Years; and 


  

	 	(b)	 the Board considers the draft Business Plan and approves a Business Plan before the star of the next Financial
Year. 


  

	9.4	 Previous Business Plans 



Each Shareholder must exercise its rights as a Shareholder to ensure: 
  


	 	(a)	 if a new Business Plan is adopted, the existing Business Plan does not have effect and the new Business Plan
has effect; and 


  

	 	(b)	 if a new Business Plan is not adopted in accordance with clause 9.3, the existing Business Plan shall continue
to apply to the Business on an ongoing basis until a new Business Plan is adopted in accordance with clause 9.3. 


  

	10.	 Financial and other reporting 



 

	10.1	 Reports and information 



The Company must give each Director and Shareholder with a Relevant Interest (together with their Associates above 10%), the financial reports
and information listed in Schedule 5 at the times specified in Schedule 5. 
  

	10.2	 Confidentiality 



Any reports or information given by the Company under clause 10.1 are given subject to clause 28. 

 

	11.	 Accounts and records 



 

	11.1	 Keeping records and accounts 



The Company must ensure that its records and accounting books are: 
  

	 	(a)	 kept in accordance with the Corporations Act; and 



 

	 	(b)	 reflect the Accounting Standards consistently applied. 



  
 15 















	11.2	 Access 



Subject to clause 28, each Shareholder and any accountant, agent, adviser, consultant or employee of each Shareholder has a right to access
during Business Hours to the books, accounts and financial records of the Company and the facilities of the Company to audit or value the Company or for any other reasonable purpose. The Shareholder must pay any cost incurred in connection with any
audit or valuation of the Company. 
  

	11.3	 Notice requesting access 



Any person seeking access under clause 11.2 must give the Company notice requesting access at least two Business Days before the date on which
access is sought. 
  

	11.4	 Copying of books and records 



Any person referred to in clause 11.2 may copy anything it has access to, using the Company’s facilities. 

 

	11.5	 Confidentiality 



A Shareholder may only disclose information to which it has access, or any copy of that information, in accordance with clause 28. 

 

	11.6	 Disclosure of information by directors 



Subject to clause 28, each Director may disclose any information (including Confidential Information) about the affairs, finances and accounts
of the Group that comes into the Director’s possession from time to time to the Shareholder that appointed the Director. 
  

	12.	 Class B Shares 



The Company may elect to issue Class B Shares from time to time by Directors Special Resolution on the terms set out in Schedule 9. 

 

	13.	 Dividend policy 



 

	13.1	 Dividend policy 



The dividend policy of the Company must be determined from time to time by the Board by Directors Special Resolution having regard to the
Business Plan, subject at all times to the Company maintaining working capital necessary to conduct its business, including in accordance with any Business Plan. 
  

	14.	 Funding 


  

	14.1	 In-Kind Contributions 



The Shareholders acknowledge and agree that neither of WA Mint or Security Matters are required to provide any funding to the Company
whatsoever and that any investment by any of them in the Company from time to time will be by way of In-Kind Contributions. 

  
 16 















	14.2	 Initial In-Kind Contributions and working capital



 The Shareholders acknowledge and agree that: 

 

	 	(a)	 they each will make an initial In-Kind Contribution in return for which
they will receive the Share Capital set out in Schedule 1; and 


  

	 	(b)	 third party equity investors will contribute the initial working capital of $1,000,000 which will fund R&D,
development capital and other expenses in accordance with the Business Plan. 


  

	14.3	 No obligation 



No Shareholder has an obligation to further provide funding to the Company beyond the obligation set out in clause 14.2, however each
Shareholder acknowledges that a failure to provide funding will result in a dilution of their equity. 
  

	14.4	 Further funding 



 

	 	(a)	 Any funds for the continuation, development or expansion of the Group’s operations are to be funded, as a
first preference where available, by a bank overdraft facility or other similar and acceptable commercial borrowing facility to be obtained by the Group unless the Board otherwise determines. 



 

	 	(b)	 The Group may grant Encumbrances to secure any finance facility or accommodation. 



 

	15.	 Issue of Equity Securities 



 

	15.1	 Issue of Equity Securities 



No Equity Securities will be issued other than in accordance with this clause 15. 

 

	15.2	 No obligation to subscribe for Equity Securities 



A Shareholder does not have to subscribe for Equity Securities under clause 15. 

 

	15.3	 Procedure for issue of Equity Securities 



If the Board resolves to issue any Equity Securities, the Equity Securities must be offered to existing Shareholders in accordance with clause
15, except if the issue is an Excluded Issue. 
  

	15.4	 Equity Offer 



The Board must offer each Shareholder the same number of Equity Securities calculated in accordance with the following formula (Offer):

 N = (A x B)/C 
 where: 

N = the number of Equity Securities to be offered for subscription to the Shareholder. 

  
 17 














 A = the total number of Equity Securities proposed to be issued. 

B = the number of Equity Securities held by the Shareholder on the date of the Offer. 

C = the total number of Equity Securities on the date of the Offer. 

 

	15.5	 Subscription Notice 



The Board must make give each Shareholder notice stating: 
  

	 	(a)	 the total number of Equity Securities available for subscription; 



 

	 	(b)	 the number of Equity Securities being offered to each Shareholder; 



 

	 	(c)	 the type of Equity Securities being offered; 



 

	 	(d)	 the term of issue of the Equity Securities; and 



 

	 	(e)	 the issue date for the Equity Securities. 



 

	15.6	 Response to Offer 



Within 15 Business Days after receiving the Offer, each Shareholder must give notice to the Board stating: 

 

	 	(a)	 whether it accepts all or a specified number of Equity Securities contained in its Offer or rejects in full its
Offer; and/or 


  

	 	(b)	 that it offers to subscribe for a specified number of those Equity Securities not subscribed for by other
Shareholders under their Offers. 


  

	15.7	 Failure to respond 



If a Shareholder does not give notice to the Board within the period specified in clause 15.6 of its acceptance or rejection of its Offer, the
Shareholder is taken to have rejected its Offer. 
  

	15.8	 Disposal to other Shareholders 



If any Equity Securities are not taken up under the Offers, the Board may allot those Equity Securities to any Shareholders that have offered
to subscribe for more Equity Securities under clause 15.6 (and, if there is competition between them, on a pro rata basis to their acceptances under clause 15.6). 
  

	16.	 Transferring Equity Securities 



 

	16.1	 Procedure 



A Shareholder may only Transfer Equity Securities in accordance with clause 16.2, except if the other Shareholders consent to the Transfer and
except as provided for in clauses 17, 18 and 23. 
  

	16.2	 Transfer Notice 



If a Shareholder wants to Transfer Equity Securities, the Shareholder (Seller) must give the other Shareholders (Offerees) notice
(Transfer Notice) stating: 

  
 18 















	 	(a)	 the number and class or classes of Equity Securities proposed to be Transferred (Sale Securities);



  

	 	(b)	 the number of Equity Securities being offered to each Offeree (to be calculated pro rata in accordance with the
number of Shares each Offeree holds proportionate to the number of Shares held by all Offerees); 


  

	 	(c)	 the cash price per Sale Security (Specified Price); 



 

	 	(d)	 the name of the transferee (if known); and 



 

	 	(e)	 any other terms of the sale of the Sale Securities. 



The Transfer Notice is deemed to be an offer to sell the Sale Securities to the Offerees on the same terms as the Seller proposes to sell to
any transferee. 
  

	16.3	 Response to Transfer Notice 



Within 20 Business Days after receiving a Transfer Notice (Offer Period), the Offerees must give the Seller notice stating: 

 

	 	(a)	 whether it accepts or rejects in full the offer made in the Transfer Notice; and 



 

	 	(b)	 if it wants to purchase a greater number of Equity Securities than the number offered to it in the Transfer
Notice and the number that it wishes to purchase. 


 The Offerees must give the Board a copy of its notice to the Seller.
 
  

	16.4	 Purchase of other Shareholders Sale Securities 



If any Sale Securities are not taken up by Shareholders under the Transfer Notice, the Seller must offer those Sale Securities to any
Shareholders that have offered to purchase a greater number of Equity Securities under clause 16.3 in accordance with the number that the Shareholder has indicated it wishes to purchase (and if there is a shortfall, on a pro rata basis to their
acceptances under clause 16.3(b)). 
  

	16.5	 If other Shareholders agree to buy Sale Securities 



If an Offeree accepts the offer made in the Transfer Notice, the sale of the Sale Securities (including any additional Sale Securities to be
transferred in accordance with clause 16.4) must be completed at 10.00am on the tenth Business Day after the end of the Offer Period, when the Offeree must buy and the Seller must sell the Sale Securities at the Specified Price. 

 

	16.6	 If other Shareholder does not agree to buy Sale Securities 



If the Offeree does not accept the offer made in the Transfer Notice, the Seller may sell the Sale Securities to a third party, subject to
clause 17 (if applicable): 
  

	 	(a)	 within 60 Business Days after giving the Transfer Notice to the Offeree; 



 

	 	(b)	 at a price per Sale Security not less than the Specified Price; and 



 

	 	(c)	 on terms no more favourable than those offered to the Offeree. 



  
 19 














 However, the Seller must be able to demonstrate to the reasonable satisfaction of the
Offeree that the third party has the management, technical and financial capacity to perform its obligations under this agreement and in relation to the operation of the Company. 

 

	16.7	 Completion of sale 



At completion of the sale of any Equity Securities under clause 16, 17 or 18: 

 

	 	(a)	 each buyer of Equity Securities must pay each seller of Equity Securities for the Equity Securities it has
agreed to buy; and 


  

	 	(b)	 each seller of Equity Securities must Transfer title to the Equity Securities it has agreed to sell to the
buyer free from all Encumbrances. 


  

	16.8	 No revocation 



A Transfer Notice or a Sale Notice cannot be revoked or withdrawn after it is given by a Shareholder, except if the other Shareholders consent.

  

	16.9	 Permitted Transfers 



Clauses 16 (except clauses 16.9 and 16.10), 17 and 18 does not apply to: 

 

	 	(a)	 a Transfer of Equity Securities by a Shareholder to an Affiliate of the Shareholder; or 



 

	 	(b)	 a Transfer of Equity Securities from an Affiliate of a Shareholder to another Affiliate of the Shareholder.



  

	16.10	 Affiliate no longer an Affiliate 



If a Shareholder undertakes a Transfer to an Affiliate of the Shareholder under clause 16.9 and: 

 

	 	(a)	 as a result of any event, the Affiliate is or will be no longer an Affiliate of the Shareholder; or



  

	 	(b)	 the Affiliate is a Defaulting Party under clause 23.2, 



the Affiliate and the Shareholder must immediately take all action necessary to Transfer all Equity Securities held by the Affiliate to the
Shareholder or another Affiliate of the Shareholder in accordance with this agreement. The rights attaching to each Equity Security held by the Affiliate are suspended until the Equity Security has been transferred under this clause. 

 

	17.	 Tag Along 


  

	17.1	 Tag along or last right of refusal 



If a Shareholder (Selling Shareholder) wants to sell the Sale Securities to a third party under clause 16.6, the Seller must give all
other Shareholders notice stating the terms of the proposed sale (Sale Notice). Within 10 Business Days after receiving the Sale Notice, the other Shareholders (Offerees) may give the Selling Shareholder notice that it wants to sell
some or all of their Equity Securities on the same terms set out in the Sale Notice (Tag Along Notice). 

  
 20 















	17.2	 If Offeree gives Tag Along Notice 



If an Offeree gives the Seller a Tag Along Notice, the Seller may only sell Sale Securities if all Equity Securities specified in the Tag Along
Notice are sold: 
  

	 	(a)	 at the Specified Price and on the same terms that the Sale Securities are sold; and 



 

	 	(b)	 at the same time the Sale Securities are sold. 



 

	18.	 Drag Along 


  

	18.1	 Drag Along Option 



Where a Shareholder or Shareholders (in the balance of this clause referred to as the Seller) wishes to dispose of all of its Shares
(Drag Transfer Shares) to a that wishes to acquire 100% of the Shares in the Company (Third Party), and the Drag Transfer Shares being offered comprise 75% or more of the aggregate number of Shares on issue at that time, then: 

 

	 	(a)	 notwithstanding clause 16, the Seller is entitled to dispose of its Drag Transfer Shares to the Third Party;
and 


  

	 	(b)	 the Seller will have the option to require all of the remaining Shareholders to transfer to the Third Party all
of the Shares held by each of the remaining Shareholders, 


 in accordance with the provisions of this clause 18 (Drag
Along Option). 
  

	18.2	 Restrictions on Drag Along Option 



The Drag Along Option is only available to the Seller provided that: 
  

	 	(a)	 any agreement for the sale of Drag Transfer Shares must be in writing and on arm’s length commercial
terms; 


  

	 	(b)	 the agreement must be for the sale of all of the Shares held by all of the Shareholders on the same terms and
at the same price per Share, except for any variance required by virtue of preference rights attaching to any Shares; 


  

	 	(c)	 no collateral benefit may pass to any Shareholder in connection with or as a consequence of the sale of the
Shares under such agreement, except pursuant to any bona fide contract of employment that a Shareholder or a director of a Shareholder may enter into with the Third Party; and 



 

	 	(d)	 WA Mint or Security Matters (being the founding Shareholders) must consent in writing. 



 

	18.3	 Drag Along Notice 



The Seller may exercise its Drag Along Option by serving a notice in writing (Drag Along Notice) on the Company and each of the
remaining Shareholders specifying: 
 (a) that the Seller is exercising its Drag Along Option; 

  
 21 















	 	(b)	 the price per Share at which the Third Party has offered to purchase the Drag Transfer Shares (Drag
Price); and 


  

	 	(c)	 the terms and conditions attached to the offer from the Third Party. 



 

	18.4	 Exercise of the Drag Along Option 



Each of the remaining Shareholders must sell all their Shares to the Third Party at the price per Share set out in the Drag Along Notice and on
the other terms set out in the Drag Along Notice. 
  

	18.5	 Completion 



The transfer of each of the remaining Shareholders’ Shares under clause 18.4 must take place on the dates specified in the Drag Along
Notice or, in the case of any of the remaining Shareholders, such other date as agreed by that remaining Shareholder, the Seller and the Third Party. 

Prior to transfer under clause 18.4, each remaining Shareholder must execute and deliver all Share transfers necessary to transfer the
Shareholder’s Shares. 
  

	19.	 Encumbering Equity Securities 



A Shareholder must not Encumber any of its Equity Securities except if the other Shareholders consent. 

 

	20.	 Deed of accession 



 

	20.1	 If Equity Securities are issued 



The Board must not allot or issue Equity Securities to a person that is not a Shareholder until the proposed allottee has executed, and
delivered to the Company, a Deed of Accession. This clause does not apply to an Excluded Issue by way of an IPO. 
  

	20.2	 If Equity Securities are transferred 



A Transfer of Equity Securities to a person that is not a Shareholder is of no effect unless and until the proposed transferee has executed,
and delivered to the Company, a Deed of Accession. 
  

	20.3	 Competitors 


  

	 	(a)	 Notwithstanding any other provision of this agreement, if an allotment, issue or transfer of Equity Securities
is to be made to a party that Security Matters believes operates a competitive business to it, it may veto that allotment, issue or transfer, not to be unreasonably withheld, delayed or denied. 



 

	 	(b)	 Notwithstanding any other provision of this agreement, if an allotment, issue or transfer of Equity Securities
is to be made to a party that WA Mint believes operates a competitive business to it, it may veto that allotment, issue or transfer, not to be unreasonably withheld, delayed or denied. 



  
 22 















	21.	 Sale of share capital 



 

	21.1	 Third party offer 



If at any time the Company or a Shareholder receives an offer from a bona fide buyer for the Share Capital (Offeror), it must give the
other parties notice on behalf of the Offeror (Offer Notice) stating: 
  

	 	(a)	 the proposed purchase price for the Share Capital (Purchase Price); 



 

	 	(b)	 the proposed settlement date (Settlement Date); 



 

	 	(c)	 the name of the Offeror; and 



 

	 	(d)	 any other terms of the offer. 



 

	21.2	 Waiver of Transfer Notice Requirement 



If the Shareholders agree by Shareholders Unanimous Decision to accept the offer in the Offer Notice, a Shareholder will not be required to
give a Transfer Notice in accordance with clause 16. 
  

	21.3	 Settlement 



On the Settlement Date: 
  

	 	(a)	 each Shareholder must give the Offeror: 



 

	 	(i)	 duly executed transfers for its Shares in favour of the Offeror; and 



 

	 	(ii)	 any certificates for those Shares; 



 

	 	(b)	 all Shares must be free from Encumbrances; 



 

	 	(c)	 the Board receives on behalf of the Shareholders the Purchase Price from the Offeror; and



  

	 	(d)	 the Board must account to the Shareholders for the Purchase Price on the same basis as equity ownership.



  

	22.	 Liquidation event 



 

	22.1	 Board to consider status of Consortium 



The Board must consider an IPO, M&A transaction, other liquidity events and if necessary a winding up of the Consortium (Liquidity
Decision) in accordance with clause 22.2 as soon as practicable after: 
  

	 	(a)	 three years after the date of this agreement; and 



 

	 	(b)	 if the Shareholders decide not to proceed with an IPO and other liquidity events under clause 22.1 at any time,
the next anniversary of the date of this agreement) after the decision. 



  
 23 















	22.2	 Appointment of Financial Adviser 



When the Board must consider a Liquidity Decision under clause 22.1, the Board must consult with and if it sees fit appoint an investment bank
or stockbroker of good standing (Financial Adviser) to act on behalf of the Company and the Shareholders to: 
  

	 	(a)	 advise on the highest valuation of the Company that could be obtained; 



 

	 	(b)	 advise on the amount of funds that could be raised through a Liquidity Decision (if relevant);



  

	 	(c)	 recommend to the Shareholders and the Company whether to proceed with the relevant decision; and



  

	 	(d)	 if the Shareholders decide to proceed with the Liquidity Decision (Liquidity Event), manage the
preparation for the Liquidity Event. 


  

	22.3	 Shareholders to decide 



When the Board receives a recommendation from the Financial Adviser under clause 22.2, the Board must promptly call a meeting of Shareholders
to decide whether to proceed with the Liquidity Event. The decision must be made by a Shareholders Special Resolution. 
  

	22.4	 Parties to cooperate on a liquidity event 



If the Shareholders decide to proceed with a Liquidity Event, the parties must cooperate and do anything reasonably required to prepare for,
and undertake, the Liquidity Event, including giving information and passing resolutions of Shareholders and the Board. 
  

	22.5	 Winding up 



If the Shareholders determine that the Liquidity Event should be a winding of the Consortium, the parties agree to work together on a suitable
disengagement plan. 
  

	23.	 Default 


  

	23.1	 Events of default 



An event of default occurs in relation to a Shareholder if: 
  

	 	(a)	 the Shareholder breaches a material term of this agreement and: 



 

	 	(i)	 does not remedy that breach within 30 days after receiving notice from another party requesting the breach be
remedied; or 


  

	 	(ii)	 the breach is incapable of being remedied; 



 

	 	(b)	 an Insolvency Event occurs in relation to the Shareholder; 



 

	 	(c)	 a Change of Control occurs in relation to the Shareholder without the other Shareholders first consenting (such
consent not to be unreasonably withheld); 



  
 24 















	 	(d)	 the Shareholder is prohibited from being a Shareholder by a change in any law; 



 

	 	(e)	 the Shareholder Transfers or purports to Transfer any of its Equity Securities in breach of the Company’s
constitution or this agreement; and 


  

	 	(f)	 where the Shareholder or its Affiliate was formerly an employee or consultant of the Company and that
Shareholder or its Affiliate ceases to be an employee or consultant of the Company, dies or becomes permanently or totally incapacitated. 


  

	23.2	 Consequence of default 



If an Event of Default occurs in relation to a Shareholder (Defaulting Party), at the election of another party by giving notice to all
parties: 
  

	 	(a)	 the rights attaching to the Defaulting Party’s Equity Securities are suspended until:



  

	 	(i)	 the default is remedied (and, if the default is not capable of remedy, are suspended indefinitely); or



  

	 	(ii)	 the Equity Securities are transferred to a person who is not a Defaulting Party; and 



 

	 	(b)	 the Defaulting Party is taken to have given a Transfer Notice under clause 16.2 on the date when the Event of
Default occurred, for all its Equity Securities at a cash price per Equity Security determined in accordance with clause 23.3. 


  

	23.3	 Independent valuation 



If a party gives notice under clause 23.2 so that the Defaulting Party is taken to have delivered a Transfer Notice, the Board must: 

 

	 	(a)	 comply with Schedule 8 and obtain an independent valuation of the Defaulting Party’s Equity Securities
within 25 Business Days after receiving notice; and 


  

	 	(b)	 immediately give a copy of the independent valuation to the Defaulting Party and the other Shareholders when
the Board receives it. 


  

	23.4	 Procedure for Transfer 



Clauses 16.2 to 16.8 (inclusive) (except clause 16.2) apply mutatis mutandis to any transfer of Equity Securities under clause 23.2. However,
those clauses are suspended until an independent valuation of the Defaulting Party’s Equity Securities is obtained under clause 23.3. 
  

	23.5	 Notice to Sell 



If an Event of Default occurs in relation to a Shareholder (Defaulting Party), the other Shareholders (Non-Defaulting
Party) may give notice (Default Notice) to the Defaulting Party and the Board requiring the Board to call a Shareholders’ meeting (Default Meeting) to auction the Defaulting Party’s Equity Securities. The Default Meeting
must be held between 15 and 25 Business Days after the date of the Default Notice. 

  
 25 















	23.6	 Each Shareholder must offer to buy other Shareholder’s Equity Securities 



At the Default Meeting, each Shareholder may irrevocably and unconditionally offer to buy all the Equity Securities of the other Shareholders,
at a specified cash price (Default Bid Price), free from Encumbrances. 
  

	23.7	 Non-Defaulting Party must decide to buy or sell



 If the Default Bid Price specified by the Non-Defaulting Party is: 

 

	 	(a)	 higher than the Default Bid Price specified by the Defaulting Party, the
Non-Defaulting Party must: 


  

	 	(i)	 buy all the Defaulting Party’s Equity Securities; or 



 

	 	(ii)	 sell all its Equity Securities to the Defaulting Party, 



at the lowest Default Bid Price; and 
  

	 	(b)	 lower than or equal to the Default Bid Price specified by the Defaulting Party, the Non-Defaulting Party must: 


  

	 	(i)	 buy all the Defaulting Party’s Equity Securities; or 



 

	 	(ii)	 sell all its Equity Securities to the Defaulting Party, 



at the highest Default Bid Price. 
  

	23.8	 Notice of decision 



The Non-Defaulting Party must give the Defaulting Party and Board notice of its decision whether to buy
or sell Equity Securities under clause 23.4 within 2 Business Days after the Default Meeting. 
  

	23.9	 Completion of sale of Equity Securities 



Completion of any sale of Equity Securities under this clause 23 must take place at 10.00am on the seventh Business Day after the Default
Meeting. At that time: 
  

	 	(a)	 the selling Shareholder must give the buying Shareholder: 



 

	 	(i)	 duly executed transfers for the Equity Securities in favour of the buying Shareholder; and



  

	 	(ii)	 any certificates for the Equity Securities 



 

	 	(b)	 the Equity Securities must be free from Encumbrances; and 



 

	 	(c)	 the buying Shareholder must pay the purchase price for the Equity Securities in cleared funds to the selling
Shareholder. 


  

	23.10	 Other remedies 



Clause 23 is in addition to and not the exclusion of any other rights or remedies that the other parties may have against a Defaulting Party.


  
 26 















	24.	 Resolution of disputes 



 

	24.1	 Procedure for Resolving Disputes 



 

	 	(a)	 Any dispute arising out of or in connection with this agreement, including any Deadlock, question regarding its
existence, validity or termination (Dispute) must be resolved in accordance with the procedure set out in this clause 24.1. 


  

	 	(b)	 Nothing in this clause 24 will prevent a party commencing court proceedings for the purposes of seeking urgent
injunctive or similar interim relief from a court. 


  

	 	(c)	 The sequence to resolve a Dispute is as follows: 



 

	 	(i)	 (negotiation) First, the Dispute will be resolved by negotiation in accordance with clause 24.2.



  

	 	(ii)	 (court) Second, if the Dispute remains unresolved (in whole or part) after the expiration period for
negotiation referred to in clause 24.2, then a Party will be entitled to commence court proceedings. 


  

	 	(d)	 Unless another Party fails to comply with any of the procedures set out in clause 24.2, and without prejudice
to clause 24.1(b), a Party is not entitled to commence court proceedings in relation to a dispute unless and until the procedures set out in clause 24.2 are complied with according to the sequence in clause 24.1(c) . 



 

	 	(e)	 Until a Dispute is finally agreed, determined, adjudicated or settled in accordance with the foregoing
provisions of this clause 24.1, the status quo will remain in relation to such matter. 


  

	24.2	 Negotiation 


  

	 	(a)	 (Dispute notice): A Party may give a Dispute notice to the other Party(s) in accordance with clause
24.2(b) setting out the matters the subject of the Dispute. For the avoidance of doubt, a Deadlock Notice given under clause 25.2 is deemed to be a dispute notice for the purposes of this clause 24.2. 



 

	 	(b)	 (requirements for Notice) A notice given under clause 24.2(a) must include or be accompanied by
reasonable particulars of the matters the subject of the Dispute and contain the position (including reasons for that position) of the Shareholder who delivered the notice. 



 

	 	(c)	 (Good faith negotiation) The parties involved in the Dispute must attempt to resolve the Dispute within
10 Business Days (or such shorter period as the Shareholders may agree in writing) from the date on which the Shareholder(s) receives a Dispute notice under clause 24.2(a). 



 

	 	(d)	 (Representatives negotiations) If the Dispute has not been resolved within the specified time period set
out in clause 24.2(c), then the parties must each appoint a representative with authority to negotiate in good faith (together, the Representatives) in an attempt to resolve the Dispute as soon as practicable and, in any event, within 5
Business Days. 


  

	 	(e)	 (Representatives) The Representative appointed by: 



  
 27 















	 	(i)	 Security Matters, is Haggai Alon; and 



 

	 	(ii)	 WA Mint, is Richard Hayes. 



 

	 	(f)	 (joint decision binding) The joint decision (if any) of the Representatives will be reduced to writing
and will be contractually binding on the parties. 


  

	24.3	 Costs 



Each Party will bear their own costs (including legal costs) in relation to any good faith negotiations undertaken pursuant to clause 24.2(c)
and any representatives negotiations undertaken pursuant to clause 24.2(d). 
  

	25.	 Deadlock 


  

	25.1	 When a deadlock arises 



A deadlock arises if the Board disagrees on a material matter regarding the fundamental operation of the Company or the Business and cannot
resolve the disagreement within 10 Business Days of the disagreement first arising. 
  

	25.2	 Deadlock Notice 



 

	 	(a)	 If the Shareholders are unable to reach agreement on any matter set out in clause 25.1, any Shareholder may
send the other Shareholder a notice (Deadlock Notice) setting out the matter in dispute (Deadlock), its position and its reasons for adoption of such position. 



 

	 	(b)	 The Deadlock Notice triggers the dispute resolution procedure set out in clause 24. 



 

	25.3	 Actions Pending Resolution of Deadlock 



Until the subject of a Deadlock Notice has been resolved in accordance with clause 24, the Shareholders must procure to the extent possible
that the Company continue to operate the Business in the ordinary course and, to the extent possible, in accordance with the Business Plan. 
  

	26.	 Warranties regarding capacity and status 



Each party represents and warrants that each of the following statements is true and accurate at the date of this agreement: 

 

	 	(a)	 if it is a corporate entity, it is validly existing under the laws of its place of incorporation;



  

	 	(b)	 it has the power to enter into and perform its obligations under this agreement and to carry out the
transactions contemplated by this agreement; 


  

	 	(c)	 it has taken all necessary action to authorise its entry into and performance of this agreement and to car out
the transactions contemplated by this agreement; and 


  

	 	(d)	 its obligations under this agreement are valid and binding and enforceable against it in accordance with their
terms. 



  
 28 















	27.	 Trustees 



Without limiting or affecting any other provision of this Agreement, or any other obligation of a party under this Agreement or any other
Transaction Document, if a party is or becomes a trustee of a trust (whether or not that fact has not been disclosed to the other parties), it: 
  

	 	(a)	 acknowledges that this agreement binds or (as the case may be) will bind it personally and in its capacity as
trustee of each such trust; and 


  

	 	(b)	 must cause any of its successors as trustee of any such trust to execute all documents which the other parties
require to ensure that this Agreement binds that successor. 


  

	28.	 Confidentiality and announcements 



 

	28.1	 Confidentiality obligations 



Each party must: 
  

	 	(a)	 use the Confidential Information only for the purposes of the Business or to make decisions regarding its
investment in the Company; 


  

	 	(b)	 keep the Confidential Information confidential and not disclose it or allow it to be disclosed to a third party
except: 


  

	 	(i)	 with the prior written approval of each other party; 



 

	 	(ii)	 to any officer, employee, consultant, adviser or related body corporate of a party to the extent to which they
have a need to know and who are aware that the Confidential Information must be kept confidential; 


  

	 	(iii)	 if required by law or by any stock exchange to disclose, in which case the party must immediately notify the
other parties of the requirement; 


  

	 	(iv)	 if the Confidential Information is in or enters the public domain for reasons other than a breach of this
agreement; or 


  

	 	(v)	 if the Confidential Information is disclosed to the party by a third party legally entitled to disclose that
information and who is not under an obligation of confidentiality to the other parties; and 


  

	 	(c)	 take or cause to be taken reasonable precautions necessary to maintain the confidentiality of the Confidential
Information. 


  

	28.2	 Announcements 



Subject to clause 28.3, any announcement, press release or other communication of any kind relating to the negotiations of the parties or the
subject matter or terms of this agreement must be agreed by the parties except if it must be made by law or order of any court, tribunal, authority or regulatory body (including a relevant stock exchange). 

  
 29 















	28.3	 Exceptions 



The obligations of confidentiality under this agreement do not extend to information that (whether before or after this agreement is executed):

  

	 	(a)	 is disclosed to a party to this agreement, but at the time of disclosure is rightfully known to or in the
possession or control of the party and not subject to an obligation of confidentiality on the party; 


  

	 	(b)	 is public knowledge (but not because of a breach of this agreement or any other obligation of confidence);



  

	 	(c)	 must be disclosed by law or order of any court, tribunal, authority or regulatory body or in connection with
the enforcement of this agreement or by the rules of a stock exchange; or 


  

	 	(d)	 subject to clause 28.4, a Shareholder discloses to an adviser of the Shareholder on a confidential basis.



  

	28.4	 Commercially sensitive information 



Despite any other term of this agreement, a permitted disclosure under clause 28.3 must not include technical information in relation to the
Company’s operations that the Company has informed a Shareholder in writing is commercially sensitive. 
  

	29.	 Termination 


  

	29.1	 Termination for all parties 



Subject to clause 29.3, this agreement terminates automatically if: 
  

	 	(a)	 all the parties agree; 



 

	 	(b)	 the Company is wound up by court order; 



 

	 	(c)	 if Shares offered in an IPO are allotted; or 



 

	 	(d)	 an agreement to sell all of the issued share capital of the Company is completed. 



 

	29.2	 Termination for a Shareholder 



Subject to clause 29.3, this agreement terminates automatically for a Shareholder, if it stops holding, directly or indirectly, Shares. At that
time the Shareholder has no further rights or obligations under this agreement (except under clauses 16, 17, 18 and 28). 
  

	29.3	 Accrued rights 



Termination of this agreement is without prejudice to any accrued rights of the parties. 

 

	30.	 Paramountcy 



The Shareholders acknowledge and agree that: 

  
 30 















	 	(a)	 this agreement prevails over any inconsistent term, clause or statement in the Offer; and



  

	 	(b)	 this agreement prevails over any inconsistent clause in the Company’s constitution and the Shareholders
must amend the Company’s constitution to remove the inconsistency as soon as they become aware of it. 


  

	31.	 GST 


  

	31.1	 Interpretation 



In this clause 31, a word or expression defined in the A New Tax System (Goods and Services Tax) Act 1999 (Cth) has the meaning given to
it in that Act. 
  

	31.2	 GST gross up 



If a party makes a supply under or in connection with this agreement in respect of which GST is payable, the consideration for the supply but
for the application of this clause (GST exclusive consideration) is increased by an amount equal to the GST exclusive consideration multiplied by the rate of GST prevailing at the time the supply is made. 

 

	31.3	 Reimbursements 



If a party must reimburse or indemnify another party for a loss, cost or expense, the amount to be reimbursed or indemnified is first reduced
by any input tax credit the other party is entitled to for the loss, cost or expense, and then increased in accordance with clause 31.2. 
  

	31.4	 Tax invoice 



A party does not have to make a payment for a taxable supply made under or in connection with this agreement until it receives a tax invoice
for the supply to which the payment relates. 
  

	32.	 General provisions 



 

	32.1	 Entire agreement 



This agreement together with the Transaction Documents constitutes the entire agreement between the parties regarding the matters set out in it
and supersedes any prior representations, understandings or arrangements made between the parties, whether orally or in writing. 
  

	32.2	 Variation 



This agreement may be amended by written resolution of Shareholders executed by Shareholders holding not less than 80% of all Shares on an as
converted, fully diluted basis, provided in all instances that Security Matters and WA Mint must each approve any amendment. 
  

	32.3	 Waiver 



A right created by this agreement cannot be waived except in writing signed by the party entitled to that right. Delay by a party in exercising
a right does not constitute a waiver of that right, nor will a waiver (either wholly or in part) by a party of a right operate as a subsequent waiver of the same right or of any other right of that party. 

  
 31 















	32.4	 Further assurances 



Each party must promptly execute all documents and do everything reasonably necessary or desirable to give full effect to the arrangements
contained in this agreement. 
  

	32.5	 Approvals and consents 



Except where this agreement expressly states otherwise, a party may, in its discretion, give conditionally or unconditionally or withhold any
approval or consent under this agreement. 
  

	32.6	 Assignment 



A party may only assign this agreement or a right under this agreement with the prior written consent of each other party. 

 

	32.7	 Time for doing acts 



 

	 	(a)	 If: 


  

	 	(i)	 the time for doing any act or thing required to be done; or 



 

	 	(ii)	 a notice period specified in this agreement, 



expires on a day other than a Business Day, the time for doing that act or thing or the expiration of that notice period is extended until the
following Business Day. 
  

	 	(b)	 If any act or thing required to be done is done after 5 pm on the specified day, it is taken to have been done
on the following Business Day. 


  

	32.8	 Governing law and jurisdiction 



 

	 	(a)	 The laws applicable in Western Australia govern this agreement. 



 

	 	(b)	 The parties submit to the non-exclusive jurisdiction of the courts of
Western Australia and any courts competent to hear appeals from those courts. 


  

	32.9	 Severance 



If any clause or part of any clause is in any way unenforceable, invalid or illegal, it is to be read down so as to be enforceable, valid and
legal. If this is not possible, the clause (or where possible, the offending part) is to be severed from this agreement without affecting the enforceability, validity or legality of the remaining clauses (or parts of those clauses) which will
continue in full force and effect. 
  

	32.10	 Preservation of existing rights 



The expiration or termination of this agreement does not affect any right that has accrued to a party before the expiration or termination
date. 

  
 32 















	32.11	 No merger 



Any right or obligation of any party that is expressed to operate or have effect on or after the completion, expiration or termination of this
agreement for any reason, will not merge on the occurrence of that event but will remain in full force and effect. 
  

	32.12	 Relationship of parties 



Unless otherwise stated: 
  

	 	(a)	 nothing in this agreement creates a partnership, or the relationship of principal and agent, or employee and
employer between the parties; and 


  

	 	(b)	 no party has the authority to bind any other party by any representation, declaration or admission, or to make
any contract or commitment on behalf of any other party or to pledge any other party’s credit. 


  

	32.13	 Costs 



Each party must pay its own costs of negotiating, preparing and executing a Transaction Document and any instrument or document executed to
give effect to a Transaction Document. 
  

	32.14	 Stamp Duty 



Any stamp duty, duty or other tax of a similar nature (including fines, penalties and interest) in connection with this agreement and on any
transaction contemplated by this agreement, must be paid by the Company. 
  

	32.15	 Survival 



Any indemnity or obligation of confidence under this agreement is independent and survives termination of this agreement. Any other term by its
nature intended to survive termination of this agreement survives termination of this agreement. 
  

	32.16	 Notices 



Form 
 Any notice, demand,
consent, approval, request or other communication (notice) to be given under this agreement must be in writing in the English language and must be given to the recipient at its address for service by being: 

 

	 	(a)	 hand delivered; 


  

	 	(b)	 sent by email transmission; 



 

	 	(c)	 sent by prepaid ordinary mail within Australia; or 



 

	 	(d)	 sent by prepaid Express Post International airmail to the address for service of the recipient party, if the
address for service of the sender and the recipient are in different countries. 



  
 33 














 Time 

A notice is given if: 
  

	 	(e)	 hand delivered, on the date of delivery; 



 

	 	(f)	 sent by email transmission during any Business Day, on the date that the sending party’s electronic
equipment reported that the email had been delivered; 


  

	 	(g)	 sent by prepaid ordinary mail within Australia, on the date that is 4 Business Days after the date of posting;
or 


  

	 	(h)	 sent by prepaid Express Post International airmail between countries, on the date that is 10 Business Days
after the date of posting. 


 Initial service details 

The addresses for service are initially as follows, however, each party may notify the other parties of their new address for service from time
to time: 
 Security Matters: 

Address: c/- K&L Gates, Level 25, 525 Collins Street, Melbourne 

Electronic mail: haggai@securitymattersltd.com 

Attention: Haggai Alon, CEO 

WA Mint: 
 Address: 310 Hay
Street, East Perth, Western Australia 6005 
 Electronic mail: risk@perthmint.com 

Attention: Company Secretary 

Company: 
 Address: 51B
Marlow Street, Wembley, 6014 
 Electronic mail: zeren@securitymattersltd.com 

Attention: Zeren Browne 
  

	32.1	 Counterparts 



This Agreement may be executed in any number of counterparts, each of which is an original. All of the counterparts together constitute the one
document, as if the signatures on the counterparts were on a single copy of this Agreement. A party who has executed a counterpart of this Agreement may deliver it to, or exchange it with, another party by emailing a pdf (portable document format)
copy of the entire executed counterpart to that other party at its address for service for electronic mail. 

  
 34 














 Schedule 1– Share Capital 

(paragraph B of Introduction) 
  

									
	 Shareholder
	  	Shares	 	  	Percentage
(fully diluted)	 
	 Security Matters Limited (ACN 626 192 998)
	  	 	500,000	 	  	 	50	% 
	 W.A. Mint Pty. Ltd.
	  	 	500,000	 	  	 	50	% 
		  	  
	  
	 	  	  
	  
	 
	 TOTAL
	  	 	1,000,000	 	  	 	100	% 
		  	  
	  
	 	  	  
	  
	 


  
 35 















	Schedule	 2 – Board 



 

	1.	 Board composition 



 

	 	(a)	 During the term of this agreement, the Board of the Company will be not less than three and not more than
seven. The initial board will be comprised as follows: 


  

	 	(i)	 Security Matters may appoint up to two directors, being as at the date of this agreement Haggai Alon and
Everardus Hofland (each, a Security Matters Director); 


  

	 	(ii)	 Zeren Browne; 


  

	 	(iii)	 WA Mint may appoint up to two directors, being as at the date of this agreement Richard Hayes and a further
director to be nominated (each, a WA Mint Director); and 


  

	 	(iv)	 Hugh Morgan, who will be the non-executive, independent Chair.



  

	 	(b)	 Each of Security Matters and WA Mint have the right to remove and replace the Directors they have appointed
pursuant to paragraph 1 by providing written notice to the Company. 


  

	 	(c)	 The Board may elect to appoint persons as board observers, however they will have no right to address any
resolutions or to vote, other than as permitted by the Board. 


  

	 	(d)	 Each Shareholder must give the Company notice of appointment or removal of a Director under this paragraph 1.
Any appointment or removal takes effect when the notice is given to the Company. 


  

	 	(e)	 A Director may appoint an alternate Director to act as a Director in his or her absence. 



 

	 	(f)	 So long as a party holds 20% of the fully paid ordinary Shares, it has the power to appoint a director.



  

	 	(g)	 The Chairperson shall be determined by the Directors by Directors Special Resolution from time to time.



  

	2.	 Voting 



At a Board Meeting: 
  

	 	(a)	 each Director has one vote; 



 

	 	(b)	 all decisions are decided by simple majority vote except those requiring a Directors Special Resolution; and



  

	 	(c)	 except for a decision requiring a Directors Special Resolution, the Chairperson will have a casting vote as
well as any deliberative vote he or she may have. 



  
 36 















	3.	 Quorum 


  

	 	(a)	 The quorum for a Board Meeting is at least one Security Matters Director and one WA Mint Director.



  

	 	(b)	 If a quorum of Directors is not present within 30 minutes after the time appointed for the Board Meeting, the
meeting is adjourned to the same time and place five Business Days later. At the reconvened meeting, a quorum is any two Directors. 


  

	 	(c)	 Directors do not have to be physically present in the same place and may attend Board Meetings using any
technology that allows each Director to hear proceedings and be heard by the other Directors. 


  

	4.	 Frequency of Board Meetings 



A Board Meeting must be held at least once every calendar quarter, except if the Shareholders agree otherwise. 

 

	5.	 Time and location of Meetings 



As far as practicable each Board Meeting must be held: 
  

	 	(a)	 on the same day and week of each month; and 



 

	 	(b)	 at the same location. 



 

	6.	 Notice 



Notice of each Board Meeting must be given to all Directors, five Business Days before the scheduled time of the Board Meeting, except if all
Directors agree otherwise. 
  

	7.	 Board papers 



Each notice of a Board Meeting must include: 
  

	 	(a)	 an agenda for the meeting: 



 

	 	(b)	 a report from the CEO on the previous one month’s trading, including: 



 

	 	(i)	 comments on revenues, margins, overheads, profits, cash flow, prospects and any major commercial issues
affecting the current and future trading position of the Company and proposed actions to correct any adverse variances; and 


  

	 	(ii)	 a profit and loss statement for the month and year to date relative to budget, consolidated finance report,
consolidated balance sheet, major variations to budget, cash flow and forecasts; and 


  

	 	(c)	 copies of all papers to be considered at the meeting. 



  
 37 















	8.	 Resolutions at a Board Meeting 



The Board may only resolve matters specifically referred to in the agenda for the meeting at a Board Meeting, except if all Directors (present
or not, at the meeting) agree otherwise. 
  

	9.	 Conflicted matters 



Notwithstanding any other provision of this agreement that may be inconsistent or conflict with this provision, where a Director has or is
deemed to have a conflict of interest in relation to any matter, the conflicted Director must declare such conflict at a board meeting in advance of any deliberation on the matter and otherwise comply with his or her obligations under the
Corporations Act. 
  

	 	(a)	 A Director may vote on a resolution on a matter involving a personal interest where that Director has disclosed
his or her personal interest. 


  

	10.	 Written resolutions 



 

	 	(a)	 The Board may make a decision without convening a meeting or voting by all Directors sign a document or
documents recording the decision. 


  

	 	(b)	 All resolutions at a meeting of the Board must be decided by a simple majority (including one Security Matters
Director and one WA Mint Director) unless a greater majority is required under the relevant Constitution or any applicable Law to which the Company is subject. 



 

	11.	 Directors Remuneration 



Subject to clause 5.2, any fees, costs and expenses paid to non-executive Directors are: 

 

	 	(a)	 in the case of non-executive Directors’ fees:



  

	 	(i)	 subject to paragraphs 1 and 2 of Schedule 4, payable at the rate determined by the Board;



  

	 	(ii)	 payable by equal monthly instalments in arrears on the last Business Day of each month; and



  

	 	(iii)	 in the case of the Directors appointed by WA Mint, payable directly to WA Mint or as directed by WA Mint;



  

	 	(b)	 reviewed annually in accordance with the Consumer Price Index published from time to time by the Australian
Bureau of Statistics; and 


  

	 	(c)	 in the case of all reasonable expenses associated with or incidental to the discharge of their obligations as
Directors or otherwise in connection with any business including travelling, hotel and other expenses, reimbursed to the non-executive Directors by the Company within 20 Business Days after the Company
receives a statement of account for those expenses. 


  

	12.	 Matters to go to Board 



The following actions (in addition to any others specified in this agreement) must be approved by the Board, namely: 

  
 38 















	 	(a)	 the adoption, implementation, variation or replacement of the annual Business Plan;



  

	 	(b)	 the incurring or agreement to incur any expenditure by the Group to expend amounts or to incur any liability
(contingent or otherwise) whether on capital or expense items, and whether on one item or a series of related or interconnected or operationally inter-dependent items, where the expenditure or liability: 



 

	 	(i)	 involves an amount in excess of the Board Threshold in a Financial Year; and 



 

	 	(ii)	 is not provided for in the Business Plan for that Financial Year; 



 

	 	(c)	 the borrowing or acceptance of financial accommodation (in whatever form, including finance leases) by the
Group where: 


  

	 	(i)	 the total of such borrowings or financial accommodation and any other borrowings or financial accommodation
approved under this clause within the previous 12 month period exceeds the Board Threshold; and 


  

	 	(ii)	 any such borrowings or financial accommodation are not provided for in the Business Plan for that Financial
Year; 


  

	 	(d)	 any issue of Shares or Equity Securities in the Company or any member of the Group;



  

	 	(e)	 the disposal, transfer, lease or acquisition (by any means including as a result of a Disposal by another
person) of any asset of the Group which: 


  

	 	(i)	 involves the payment (in kind or in cash) of an amount in excess of the Board Threshold; and



  

	 	(ii)	 is not provided for in the Business Plan for that Financial Year. 



 

	 	(f)	 the creation, acquisition, disposal or transfer of any interest in a Subsidiary; 



 

	 	(g)	 the grant, variation or termination of any Encumbrance over any assets of the Group or the giving of a
guarantee or indemnity by the Group other than in the ordinary course of business; 


  

	 	(h)	 the establishment, variation to the responsibilities or composition of, or disbanding of any committee of
the Board, the delegation of any powers of the Board to any person, or the variation in terms of, or termination of any such delegation other than in accordance with this agreement; 



 

	 	(i)	 except as specifically contemplated by this agreement, the entry into, variation or termination of any
Related Party Contract or contracts of an unusual or long term nature; 


  

	 	(j)	 the engagement, variation of the terms of engagement, or termination of the engagement of any person as an
executive or consultant of the Company where the total remuneration, fees or benefits payable to the person would be $75,000 or more per year or $75,000 or more payable to the person on or following termination; 



  
 39 















	 	(k)	 all salaries of personnel of the Company; 



 

	 	(l)	 the establishment, variation or termination of an employee or executive incentive scheme for the benefit of,
employees or officers of the Company; 


  

	 	(m)	 any change of the financial or tax year of the Group; 



 

	 	(n)	 a change to the registered office of the Company; and 



 

	 	(o)	 the commencement of litigation or arbitration proceedings by the Group. 



 

	13.	 Acting in Interests of Appointing Shareholder 



The Directors appointed by a Shareholder under clause 1 may in performing any of their duties or exercising any power, right or discretion
as a Director: 
  

	 	(a)	 have regard to and represent the interests of that Shareholder; 



 

	 	(b)	 act on the wishes of that Shareholder; and 



 

	 	(c)	 disclose to that Shareholder any information obtained in his or her capacity as a Director.




  
 40 














 Schedule 3 – Directors Special Resolutions 

(clause 7) 
  

	1.	 (Chairperson and senior management) Appoint or remove the chairperson of the Company, CEO, chief
operating officer or chief financial officer or materially change their role or responsibilities. 


  

	2.	 (Power to appoint directors of other corporation) Appoint or remove a director of a corporation that the
Company may appoint or remove. 


  

	3.	 (Acquisitions) Acquire securities in other entities having a value of $250,000 or less, except in
accordance with the Business Plan. 


  

	4.	 (Equity Securities) Issue or allot or grant any right to issue or allot Equity Security having a value
of $100,000 or less, except in accordance with the Business Plan. 


  

	5.	 (Borrowing) Borrow or accept financial accommodation of $250,000 or less, except in accordance with the
Business Plan. 


  

	6.	 (Encumbrances) Mortgage, charge, pledge or encumber an asset or undertaking, except in accordance with
the Business Plan. 


  

	7.	 (Auditors) Appoint or remove the Company’s auditors (if auditors are approved by the Board to be
appointed). 


  

	8.	 (Acquisitions and disposals) Acquire, dispose of or Transfer any company or business (other than the
Business) having a value of $250,000 or less, except in accordance with the Business Plan. 


  

	9.	 (Assets) Acquire, dispose of or Transfer an asset or assets (either tangible or intangible) having a
value of $250,000 or less, except in accordance with the Business Plan. 


  

	10.	 (Capital expenditure) incur capital expenditure of $250,000 or less in a Financial Year, except in
accordance with the Business Plan. 


  

	11.	 (Finance and operating leases) Enter into a finance or operating lease costing $100,000 or less per
annum, except in accordance with the Business Plan. 


  

	12.	 (Contracts) Enter into, terminate, alter, assign, novate, enforce or waive a right under, a contract
except in the ordinary course of business. 


  

	13.	 (Accounting Standards and principles) Materially alter the Accounting Standards or principles previously
adopted by the Company for the preparation or presentation of individual or consolidated financial statements, except if required by law. 


  

	14.	 (Balance date) Change the balance date or accounting period of the Company. 



 

	15.	 (Loans) Make a loan, provide credit or other financial accommodation, having a value of $250,000 or
less, to a person in the ordinary course of business. 


  

	16.	 (Disputes) Start, conduct or settle any dispute or litigation (including with a tax authority) except
debt collection in the ordinary course of business. 



  
 41 















	0.	 (Employee share plan) Adopt or alter the terms of an employee share plan, employee share option scheme
or employee share purchase scheme or any other arrangement giving employees of the Company the right or entitlement to acquire Equity Securities. 


  

	1.	 (Employee shares) Issue shares or grant options under any employee share plan, employee share option
scheme or employee share purchase scheme or other arrangement referred to in paragraph 17. 


  

	2.	 (Transaction Documents) Terminate, alter, assign, novate, enforce or waive a right under a Transaction
Document or agree to do any of those things. 


  

	3.	 (Special Resolution) Propose a special resolution of Shareholders. 



 

	4.	 (Committees of Directors) Appoint, dissolve or alter the composition of a committee of the Board.



  

	5.	 (Dividends) Set or change the dividend or distribution policy of the Company, or declare, make or pay a
dividend or other distribution. 


  

	6.	 (Partnerships and joint ventures) Enter into or alter a partnership or joint venture.



  

	7.	 (Insurance) Alter the insurance cover over the Company or the Business or a key man insurance policy.




  
 42 














 Schedule 4 – Shareholders Special Resolutions 

(clause 7.2) 
  

	1.	 (Remuneration of Directors) Increase the remuneration payable to a Director, except in accordance with
the Business Plan. 


  

	2.	 (Bonuses) Pay any executive, profit or other bonus to a Director, except in accordance with the Business
Plan. 


  

	3.	 (Company’s constitution) Alter or amend the Company’s constitution. 



 

	4.	 (Trade Sale or disposal of Business) Sell the main operating Subsidiaries, all or a substantial part of
the Business or all or substantially all of the assets of the Group. 


  

	5.	 (Winding up) Take a step to dissolve or wind up the Company. 



 

	6.	 (Change in nature of Business) Stop caring on, or materially alter the scale of operations of, the
Business or start any business or operational activities (except business or operational activities of the Business). 


  

	7.	 (Listing) Apply to a stock exchange for a listing or for quotation of Shares. 



 

	8.	 (Acquisitions) Acquire securities in other entities having a value of more than $250,000.



  

	9.	 (Equity Securities) Issue or allot or grant any right to issue or allot Equity Security having a value
of more than $250,000. 


  

	10.	 (Borrowing) Borrow or accept financial accommodation of more than $250,000. 



 

	11.	 (Guarantee) Give or enter into a guarantee, letter of comfort or performance bond.



  

	12.	 (Acquisitions and disposals) Acquire, dispose of or Transfer any company or business (other than the
Business) having a value of more than $250,000. 


  

	13.	 (Assets) Acquire, dispose of or Transfer an asset or assets (either tangible or intangible) having a
value of more than $250,000. 


  

	14.	 (Capital expenditure) incur capital expenditure of $250,000 or less in a Financial Year, except in
accordance with the Business Plan. 


  

	15.	 (Related Party Transactions) Enter into, materially vary or terminate, an agreement or arrangement with:



  

	(a)	 a Director or an Associate of a Director; or 



 

	(b)	 a Shareholder or an Affiliate of a Shareholder. 



 

	16.	 (Financial assistance) Make a loan or provide financial assistance to a Director or an Associate of a
Director or vary the term of a loan or financial assistance previously provided to a Director or an Associate of a Director. 


  

	17.	 (Reorganisation Event) Undertake or undergo a Reorganisation Event. 



  
 43 















	18.	 (Finance and operating leases) Enter into a finance or operating lease costing more than $250,000 per
annum, except in accordance with the Business Plan. 


  

	19.	 (Loans) Make a loan, provide credit or other financial accommodation, having a value of more than
$250,000, to a person in the ordinary course of business. 


  

	20.	 (General security interest) Granting or creating any security interest over the Company’s whole
undertaking. 


  

	21.	 (Intellectual property) Other than in strict accordance with the terms of this Agreement, sell, grant or
otherwise dispose of an exclusive licence to the Company’s intellectual property. 



  
 44 














 Schedule 5 – Financial and other reporting requirements 

(clause 10.1) 
  

	1.	 Monthly 



Within 10 Business Days after the end of each month, unaudited management accounts for the preceding month comprising: 

 

	 	(a)	 commentary on the operational and financial position for the preceding month, including any variation between
the actual results and those forecast in the Business Plan; 


  

	 	(b)	 a profit and loss account and cash flow statement for the preceding month; 



 

	 	(c)	 a balance sheet as at the end of the preceding month; and 



 

	 	(d)	 a forecast of the performance of the Company in the next month. 



 

	2.	 Quarterly 



Within 21 Business Days after the end of each calendar quarter, unaudited quarterly management accounts for the preceding quarter, including
(at least): 
  

	 	(a)	 commentary on the financial performance for the preceding quarter; 



 

	 	(b)	 a quarterly management report on any variations from the Business Plan; 



 

	 	(c)	 a profit and loss statement and cash flow statement for the preceding quarter; and 



 

	 	(d)	 a balance sheet as at the end of the preceding quarter. 



 

	3.	 Annual 



Within 65 Business Days after the end of each Financial Year, unaudited financial statements (including consolidated profit and loss accounts,
balance sheets and cash flow statements) for the Financial Year. 
  

	4.	 Minutes 


  

	 	(a)	 Within 10 Business Days after each Board Meeting, minutes of the Board Meetings (where reasonably practicable
to do so). 


  

	 	(b)	 Within 10 Business Days after each meeting of Shareholders, minutes of the meeting (where reasonably
practicable to do so). 


  

	5.	 Offer information 



Full details of any offer received by the Company to buy: 
  

	 	(a)	 Shares; 


  

	 	(b)	 an interest in a Subsidiary; 



 

	 	(c)	 all or a substantial part of the Business; or 



  
 45 















	 	(b)	 all or substantially all of the assets of the Group. 



The information must be given as soon as the offer is received. 

  
 46 














 Schedule 6 – Things the Company must do 

(clause 8) 
  

	1.	 Insurances 


  

	 	(a)	 Take out and maintain insurance policies in respect of all risks that a prudent person would insure in relation
to the conduct of a business similar to the Business including indemnity insurance policies in respect of the assets of the Company. 


  

	 	(b)	 Review those policies referred to in paragraph 1(a) each year to ensure the policies are maintained to achieve
the objective in paragraph 1(a). 


  

	2.	 D8tO Insurances 



Subject to the Corporations Act, maintain directors’ and officers’ liability insurance in respect to each Director providing the
level of cover determined by the Board. 
  

	3.	 Comply with Business Plan 



Comply with the Business Plan. 
  

	4.	 Directors’ Protection Deed 



Enter into a deed of access, indemnity and insurance with each Director in a form approved by the Board. 

  
 47 














 Schedule 7 – Deed of Accession 

(clause 20) 
 DEED OF ACCESSION 

DATED 
 By [Acceding Party’s name] of [Acceding
Party’s address] (Acceding Party) 
 INTRODUCTION 

This deed is supplemental to a Shareholders Agreement between [parties], dated [date] (Shareholders Agreement). 

IT IS AGREED: 
  

	1.	 The Acceding Party confirms it has been given a copy of the Shareholders Agreement. 



 

	2.	 The Acceding Party covenants with the parties to the Shareholders Agreement (whether original or by accession)
to observe, perform and be bound by the terms of the Shareholders Agreement to the intent and effect that the Acceding Party is taken from the date on which the Acceding Party is registered as a Shareholder of the Company to be a party to the
Shareholders Agreement. 


  

	3.	 The address of the Acceding Party for the purposes of the Shareholders Agreement is, until substituted in
accordance with the Shareholders Agreement: 


 [Acceding Party’s address] 

 

	4.	 This deed is governed by the laws of Western Australia, Australia.  



EXECUTED as a deed. 

  
 48 














 Schedule 8 – Independent Valuation 

 

	1.	 Application of schedule 



This Schedule 8 applies if an independent valuation of Equity Securities is required under this agreement. 

 

	2.	 Defined terms 



In Schedule 8: 
 Fair Value
means: 
  

	 	(a)	 the dollar figure given by the Independent Valuer; or 



 

	 	(b)	 if the Independent Valuer gives a range of figures, the mid-point of
the range. 


 Independent Valuer means a person appointed under paragraph 3. 

 

	3.	 Appointment of Independent Valuer 



The Board must: 
  

	 	(a)	 appoint, by Directors Special Resolution, an independent chartered accountant or an investment bank of good
standing; or 


  

	 	(b)	 if the Board fails to agree on an appointment, request the Australian 



Disputes Centre to appoint an independent chartered accountant of at least five years standing, to determine the Fair Value of the Equity
Securities, in which case the valuation for the Equity Securities is the Fair Value amount as certified by the Independent Valuer. 
  

	4.	 Instructing Independent Valuer 



The Board must instruct the Independent Valuer to determine a range of fair market values for the Equity Securities having regard to all normal
share valuation factors that the Independent Valuer thinks are relevant, including the following assumptions: 
  

	 	(a)	 there is a willing but not anxious buyer and a willing but not anxious seller; 



 

	 	(b)	 a reasonable time in which to sell the Sale Securities being valued in the open market (and for that purpose 60
Business Days is deemed to be a reasonable time); and 


  

	 	(c)	 there is no discount for minority shareholdings nor a premium for a shareholding that will give the buyer a
controlling shareholding. 


  

	5.	 Period of determination 



The Board must use its best endeavours to ensure that the Independent Valuer determines the value of the Equity Securities as soon as
practicable but within 30 Business Days after being instructed by the Board. 

  
 49 















	6.	 Independent Valuer’s role 



The Independent Valuer acts as an expert and not as an arbitrator. 
  

	7.	 Independent Valuer’s decision 



The Independent Valuer’s determination is final and binding on all parties to the transaction. 

 

	8.	 Costs 



The Company must pay the reasonable costs and expenses of the Independent Valuer. 

 

	9.	 Access to information 



The Board must ensure: 
  

	 	(c)	 the Independent Valuer has access at all reasonable times to the accounting records and other records of the
Company; and 


  

	 	(d)	 officers of the Company give any information and explanations required by the Independent Valuer to value the
Equity Securities. 



  
 50 














 Schedule 9 — Terms of the Class B Shares 

The CBS will rank junior to all other classes of shares in the Company and will have certain rights attached to them as follows: 

 

					
	 No.
	  	 Term
	  	 Description

			
	1.	  	Price	  	Each CBS will be issued at $0.001.
			
	2.	  	Conversion:	  	 The right to convert all or some of the CBS at the CBS Holder’s sole discretion (in whole or in part), at any time, into Shares.

 
 The Conversion Price will be the Fair Value per CBS calculated at the time of Conversion
(Conversion Price). The Conversion Price will be subject to adjustment as provided below.

			
	3.	  	Adjustment for Dilution:	  	 The Conversion Price of the CBS will be subject to a broad-based weighted average anti-dilution adjustment to mitigate dilution in the event
that the Company issues additional Shares at a purchase price less than the Conversion Price of the CBS, other than:
  

(a)   any securities issued to employees, directors or consultants of the Company (as approved by
the Board);
  

(b)   securities issuable upon a share dividend;

 
 (c)   Shares issued on the
conversion of any debenture, warrant, option or other convertible security; and
  

(d)   Shares to lenders, strategic partners or in connection with the acquisition of a company or
technology (in each case, as approved by the Board),
  
 (each, an Excluded
Issue).

			
	4.	  	 Share capital

reconstruction events:
	  	The Conversion Price of the CBS will be subject to customary adjustments for share splits, dividends, recapitalisations, share buy-backs, reorganisations etc.
			
	5.	  	Mandatory conversion:	  	 In the event of:
  

(a)   an initial public offer of the Company’s Shares; or

 
 (b)   the vote or written
consent of holders of at least two thirds of the CBS voting as a separate class,
  
 the
CBS will automatically be converted into Shares at the then applicable Conversion Price and the Fair Value will be payable by the CBS Holder.

			
	6.	  	Mandatory Redemption:	  	 Redemption of the CBS may occur by way of:
  

(a)   buy-back (other than an
on-market buy-back); or
  

(b)   capital reduction pursuant to a cancellation of the CBS.

 
 In each of these cases, the CBS will be cancelled.

			
	7.	  	Liquidation Preference:	  	The CBS are non-participating and non-preferred.


  
 51 















					
	8.	  	Drag Along:	  	Subject to a majority resolution of the Board in support of the application of the drag and where more than 50% of each class of shareholders accept a bona fide third party offer to purchase 100% of the Shares of the Company,
holders of CBS will be bound to sell.
			
	9.	  	Dividends:	  	CBS will not be entitled to a fixed dividend or coupon.
			
	10	  	Voting:	  	The CBS will not be entitled to a vote.
			
	11	  	Reserved Matters:	  	The approval of holders of at least two thirds of the CBS will be required to amend the terms of the CBS.


  
 52 















					
	Execution page	 		  	
			
	Executed as an agreement	 		  	
			
	Executed by Security Matters Limited 	 		  	
	(ACN 626 192 998) in accordance with	 		  	
	section 127 of the Corporations Act:	 		  	
			
	  
	 		  	  

	Signature of Director	 		  	Signature of Director/Secretary
			
		 		  	             Haggai Alon

	Name of Director	 		  	Name of Director/Secretary
			
		 	)	  	
	Executed by W.A. Mint Pty. Ltd. (ACN	 	)	  	
	054 024 314) in accordance with	 	)	  	
	section 127 of the Corporations Act:	 		  	
			
	  
	 		  	  

	Signature of Director	 		  	Signature of Director/Secretary
			
	         Richard Hayes
	 		  	 David J Koch — Company Secretary

	Name of Director	 		  	Name of Director/Secretary
			
		 	)	  	
	Executed by True Gold Consortium Pty 	 		  	
	Ltd (ACN 641 483 374) in accordance	 	)	  	
	with section 127 of the Corporations	 	)	  	
	Act:	 		  	
			
	  
	 		  	  

	Signature of Director	 		  	Signature of Director/Secretary
			
	         Zeren Browne
	 		  	         Haggai Alon

	Name of Director	 		  	Name of Director/Secretary


  
 53 














 Annexure A — Offer for Gold Marking System 

  
 54