Limeade : Appendix 4C and Quarterly Activity Report

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ASX / MEDIA RELEASE

Quarterly Activities Report and Appendix 4C

Highlights1:

• FY21 financial guidance maintained; $50-53 million in revenue; EBITDA loss of $5-8 million, and net loss after tax of $7 to $10 million
• FY21 CARR2 of $56.8 million, up 3% on FY20
• Six new Limeade Well-Being enterprise contracts signed during the quarter, generating $3.6 million in additional CARR
• 59 new Limeade Advanced Listening (TINYpulse) mid-market and SME customer signings, generating $0.5 million in additional CARR
• Q4 2021 net cash receipts of $17.0 million, operating cash outflows of $0.2 million
• FY21 net cash receipts of $56.6 million, operating cash outflows of $6.2 million
• Cash position of $13.9 million as at 31 December 2021 and no drawn debt
• FY22 sales pipeline of $47 million, including $14.7 million in finalist & verbal stages
• Continued improvement in business conditions into FY22 anticipated

SYDNEY, Australia and Bellevue, Washington. - 21 January 2022 -Limeade(ASX: LME, or the Company), an immersive employee well-being company that creates healthy employee experiences, today announces the quarterly activities report and Appendix 4C quarterly cash flow report for the three months ended 31 December 2021.

Limeade CEO Henry Albrecht commented "We are pleased with the conversion of our late-stage pipeline in Q4 2021 to new customer contracts. Coupled with the continued outperformance of Limeade Advanced Listening (TINYpulse) relative to our internal expectations at the time of the acquisition, Limeade is well positioned to continue its momentum as we commence the 2022 financial year."

During the quarter, the Company recorded cash receipts from customers of $22.0 million, up 55% versus the prior corresponding period (pcp), reflecting the contribution of Limeade Advanced Listening (TINYpulse) and the timing effect of a large annual subscription payment from a significant enterprise customer collected during the quarter (versus Q3 in 2020).

1. All amounts are expressed in US$ unless otherwise stated.
2. CARR - Contracted Annual Recurring Revenue

Limeade, Inc. │ ARBN 637 017 602 │ 10885 NE 4th Street ∙ Suite 400 ∙ Bellevue ∙ WA 98004 │

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Net cash receipts from customers after adjusting for payments made in relation to the sale of third-party products and services was $17.0 million, up 42% versus the pcp. Third party payments of $5.0 million were up 117% versus the pcp and sequentially up 24% when compared to Q3 2021, reflecting an increase in demand for biometric screenings and well-being incentives.

Cash payments during the quarter were directed towards the following costs: staff ($9.9 million), administration & corporate ($3.8 million), operating ($1.0 million), marketing ($0.8 million) and research & development ($1.7 million).

The 10% increase in quarterly staff costs versus the pcp reflects the additional headcount from the TINYpulse acquisition. The increase in Limeade R&D versus the pcp reflects the acquisition of the TINYpulse R&D center in Vietnam and additional contract development investments into the Limeade Well-Being platform during the quarter.

The Company recorded operating cash outflows of $0.2 million for the quarter, a decrease of

89% versus the pcp and a decrease of 96% on Q3 2021. Investing cash flows for the quarter were $0.85 million, reflecting Limeade capitalized software development costs incurred.

The Company made related third-party payments of $91 thousand representing fees paid to non- executive directors for performance of their required duties as disclosed in the prospectus and annual report.

The Company's cash balance as at 31 December 2021 was $13.9 million, with the Company remaining debt-free and well-positioned to capitalize on both organic and inorganic growth opportunities in 2022. In addition, the Company maintains a $15 million undrawn debt facility credit facility with Comerica Bank.

Cash and recurring subscription revenue from the existing customer base remains strong with the top 20 customers on average having 20 months remaining on their contracts (up from 19 months at Q3 2021).

Limeade ended FY21 with CARR of $56.8 million, up 3% on FY20. The primary drivers of CARR changes during the year were the acquisition of TINYpulse, large enterprise Limeade Well-Being sales, the non-renewal or loss of several key customer contracts (including top 10 customer American Airlines previously disclosed), a misaligned indirect Limeade Well-Beingmid-market channel and a new contract win rate reflective of the challenging economic climate. As at 31 December 2021, indirect Limeade Well-Being CARR represented 3.1% of total Company CARR, versus 10.3% as at FY20.

Limeade, Inc. │ ARBN 637 017 602 │ 10885 NE 4th Street ∙ Suite 400 ∙ Bellevue ∙ WA 98004 │

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Overall year to date Net Revenue Retention (NRR)3 was 80% as at 31 December 2021. Limeade direct customer NRR was 85%, a decline of 5% versus the pcp and 1% on Q3 2021, while indirect (partner) NRR was 31% (versus 66% in Q3 2021). The decline in the direct channel was driven broadly across the customer base with retail, transportation and other vulnerable sectors accounting for the majority of the decline. Limeade is now focused on building healthier and more strategic indirect channel partnerships in FY22.

During Q4 2021, Limeade signed 6 new enterprise contracts for $3.6M in CARR (Q4 2020: 7 contracts for $4.5M CARR) with one European Union and five North American customers across the healthcare, financial services and retail sectors.

During the quarter, Limeade successfully launched Limeade Well-Being to the mid-market, significantly expanding the total addressable market in the 500-5,000 employee market segment.

The Company's sales pipeline (including TINYpulse) at Q4 2021 was $47 million, including $14.7 million in finalist & verbal stages, compared to the pcp (Q4 2020) sales pipeline of $60.3 million, including $12.9 million in finalist & verbal stages. As Limeade early-stage (marketing) pipeline has proven to be a poor indicator of growth during the COVID-19 era due to budget uncertainties, delays and freezes, Limeade has elected to report later-stage pipeline to reflect the Company's more predictable later-stage finalist/verbal pipeline.

Limeade is pleased to re-confirm financial guidance for FY21 as follows:

• Revenue of $50-53 million
• Earnings Before Interest, Tax, Depreciation and Amortization (EBITDA) loss of $5-8 million
• Net loss after tax of $7-10 million

Limeade has provided investors a snapshot on the use of funds as stated in the IPO prospectus during the quarter in the table shown in Appendix 1.

Investor Call

Mr Henry Albrecht, CEO and Mr Todd Spartz, CFO will host the conference call commencing at 9.00am Australian Eastern Daylight Time (AEDT) today (2.00pm PT on Thursday, 20 January), followed by a question and answer session.

Details of the call are set out below.

In order to pre-register for the conference call, please follow the link below. You will be given a unique pin number to enter when you call, providing immediate access to the event.

3 Net revenue retention (NRR), defined as CARR at the beginning of the period plus any CARR added in that period through sale of new solutions to customers who were customers at the beginning of the period (existing customers) or expansion in the number of employees of existing customers; less any reduction in CARR in that period through existing customers who terminate, decide not to renew their subscription or reduce usage of Limeade solutions amongst their employee population, divided by CARR at the beginning of the period.

Limeade, Inc. │ ARBN 637 017 602 │ 10885 NE 4th Street ∙ Suite 400 ∙ Bellevue ∙ WA 98004 │

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https://s1.c-conf.com/diamondpass/10018598-kzv2en.html

An audio dial-in facility has been established for the purposes of the meeting, as set out below. Due to high demand for operator moderated calls, investors are advised to register for the conference in advance by using the Diamond Pass link above to avoid delays in joining the call directly through the operator. Alternatively, investor can elect to dial-in (noting the delays above) on the morning of the meeting. Please allow up to 5-10 minutes for this process.

Conference ID: 10018598

Participant Dial-in Numbers:

Australia Toll Free: 1800 908299

Australia Local: [phone]

New Zealand: 0800 452 795

Canada/USA: 1855 624 0077

Hong Kong: 800 968 273

Japan: 006 633 868 000

China: 108 001 401 776

Singapore: 800 101 2702

United Kingdom: 0800 0511 453

This release dated 21 January 2022 has been authorised for lodgement to ASX by the Board of Directors of Limeade and lodged by Mr Danny Davies, the Limeade ASX Representative.

- ENDS -
Contact Information
Company	Investor Relations / Media (AU)
Mr Henry Albrecht	Dr Thomas Duthy
Chief Executive Officer	Nemean Group for Limeade
[e-mail]	[e-mail]
[phone]	[phone]
Media (US)
Ms Amanda Lasko
Marketing Director
[e-mail]
[phone]

To subscribe to the Limeade Email Alert Service please click here.

Limeade, Inc. │ ARBN 637 017 602 │ 10885 NE 4th Street ∙ Suite 400 ∙ Bellevue ∙ WA 98004 │

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About Limeade

Limeade is an immersive employee well-being company that creates healthy employee experiences. Limeade Institute science guides its industry-leading software and its own award- winning culture. Today, millions of users in over 100 countries use Limeade solutions to navigate the future of work. By putting well-being at the heart of the employee experience, Limeade reduces burnout and turnover while increasing well-being and engagement - ultimately elevating business performance. To learn more, visitwww.limeade.com(ASX listing: LME).

Limeade, Inc. Australian Registered Business Number 637 017 602, a public limited company registered under the Washington Business Corporation Act (UBI Number: 602 588 317).

Disclosure

This ASX release does not constitute an offer to sell, or the solicitation of an offer to buy, nor shall there be any sale of any securities referred to herein in any state or other jurisdiction in which such offer, solicitation or sale would be unlawful. Any securities referred to herein have not been registered under the US Securities Act of 1933, as amended (the "US Securities Act") and may not be offered or sold in the United States or to US persons absent registration or an applicable exemption from registration under the US Securities Act and applicable state securities laws. In addition, any hedging transactions involving the securities referred to herein may not be conducted unless in compliance with the US Securities Act.

Limeade, Inc. │ ARBN 637 017 602 │ 10885 NE 4th Street ∙ Suite 400 ∙ Bellevue ∙ WA 98004 │

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