Ann: Convertible Note issue, page-3

TV2U INTERNATIONAL LIMITED ANNOUNCES CONVERTIBLE NOTE ISSUE. TV2U International Limited (ASX: TV2) (the Company) advises that it has signed a further funding agreement with MEF I, L.P. (Investor) (Convertible Note Agreement). A summary of the terms of the convertible notes are set out at Annexure 1 to this announcement (Convertible Note Terms). Under the Convertible Note Agreement the Company proposes to issue $US denominated convertible notes with a face value of US$1.10 each, at a 10% discount (Convertible Notes), for the purposes of raising funds for the Company's general corporate and working capital purposes. The Convertible Notes are proposed to be issued in three separate tranches of Convertible Notes to the Investor. These are: 1. Tranche C Convertible Notes – In Tranche C the Company proposes to issue (within its ASX listing rule 7.1 placement capacity) 462,000 Tranche C Convertible Notes at an issue price of US$1.00 per Tranche C Convertible Note to the Investor, subject to satisfaction of certain conditions precedent described further in the Convertible Note Terms, to raise the US$ equivalent of A$600,000. In the absence of obtaining certain shareholder approvals in relation to the Tranche C Convertible Notes, a fixed A$/US$ exchange rate of 0.770 and a fixed minimum conversion price of $A0.005 will apply in relation to the conversion of Tranche C Convertible Notes. If certain shareholder approvals are obtained in relation to the Tranche C Convertible Notes, they will be convertible into ordinary shares on the same terms as any Tranche D Convertible Notes and Tranche E Convertible Notes that are issued. 2. Tranche D Convertible Notes – In Tranche D the Company proposes to issue a number of Tranche D Convertible Notes at an issue price of US$1.00 per Tranche D Convertible Note to be issued subject to satisfaction of certain conditions precedent described further in the Convertible Note Terms (but including the receipt of the necessary shareholder approvals) to raise the US$ equivalent of $1,000,000. The number of Tranche D Convertible Notes that may be issued will depend on the A$/US$ exchange rate at the date of issue. 3. Tranche E Convertible Notes – In Tranche E, subject to certain conditions precedent described in the Convertible Note Terms (but including the receipt of the necessary shareholder approvals), the Company may give a written notice to the Investor by no later than 20 November 2017 requiring the Investor to subscribe for a number of Tranche E Convertible Notes on a specified date between 1 December 2017 and 8 December 2017 to raise the US$ equivalent of A$1,400,000. The number of Tranche E Convertible Notes issued depends on the A$/US$ exchange rate at the date of issue. Convertible Notes that are not redeemed or converted into ordinary shares, will mature 12 months after they are issued except in the case of the Tranche C Convertible Notes where, if the necessary shareholder approvals are not obtained on or before the date that is 60 days after their date of issue, the maturity date will be reduced to 6 months after their issue date. Convertible Notes will automatically convert into shares on maturity, unless the Investor elects (at least 5 business days' before maturity) for those Convertible Notes to be redeemed, in which case the Company must pay the face value of each such Convertible Note to the Investor. Except as described in item 1 above in relation to the Tranche C Convertible Notes, each Convertible Note will be convertible into ordinary shares in the Company, at the option of the Investor at the lower of an agreed floor price or at a price equal to 90% of the average of the four (4) lowest daily VWAPs over the ten (10) Trading Day period on which trading in shares occurred on ASX immediately prior to the election to convert. _______________________________________________________________________________________________ ME_140672244_1 The agreed floor price at the time of conversion will be the lower of: • A$1.8 cents per share, subject to this amount being permanently increased to: o if the VWAP of Shares is above $A0.025 for more than 5 consecutive trading days, A$0.025; and o if the VWAP of Shares is above A$0.030 for more than 5 consecutive trading days, A$0.030; and • the lowest price at which the Company issues shares during the term of the Convertible Notes (other than pursuant to the conversion of the existing convertible notes on issue or other Convertible Notes, an entitlement offer, or the exercise of any outstanding performance shares on issue). It will be necessary for the Company to lodge a prospectus in relation to the issue of the Tranche C and Tranche D Convertible Notes with ASIC, which is expected to occur shortly. The Company also proposes to convene an extra ordinary general meeting of the Company to seek the relevant shareholder approvals in relation to the Convertible Notes.