zSpace, Inc. · OTC:ZSPC
zSpace — SPAC Merger (June 2022)
44 slides from zSpace's SPAC merger presentation, Jun 8, 2022
Slide 1: Investor Presentation June 2022
Investor Presentation June 2022
Slide 2: Disclaimer
Disclaimer This Presentation (together with oral statements made in connection herewith, the “Presentation’) is for informational purposes only to assist prospective purchasers in a private placement in making their own evaluation with respect to the proposed business combination (the “Business Comb
Slide 3: Forward Looking Information
Forward Looking Information Certain statements in this Presentation may be considered “forward-looking statements” within the meaning of the “safe harbor” provisions of the U.S. Private Securities Litigation Reform Act of 1995. Forward-looking statements herein generally relate to future events or t
Slide 4: Additional Information
Additional Information Use of Projections This Presentation contains projected financial information with respect to 2Space. Such projected financial information constitutes forward-looking information, is for illustrative purposes only and should not be relied upon as being predictive of future res
Slide 5: Additional Information
Additional Information Part Etech zSpace end thoi respective directors and executive ofces may be deemed participants inthe slictation of proses from Edtechisstoctholders wth respect tothe proposed Butiness Combmnation, Aliet ofthe names of Cates decors and executive officers and a description ofthe
Slide 6: EdtechX Holdings Acquisition Corp. II: Edtech & Future of Work-Focused SPAC
EdtechX Holdings Acquisition Corp. Il: Edtech & Future of Work- Focused SPAC With a “SPAC for Good” Impact Mandate iti Kates EdTechX Holdings (NASDAQ : EDTXU), a new member of 1. Reach & Affordability the Nasdaq family, has launched a #SPACsForGood ‘campaign. Lead by Benjamin Vedrenne-Cloquet and Ch
Slide 7: zSpace: Pioneering the "Eduverse"
zSpace: Pioneering the “Eduverse” zSpace’s immersive AR/VR technology unites education with the metaverse, providing students with equitable access to innovative, engaging learning experiences. Global AR, VR, and mixed reality (MR) market! $250b by 2028 (vs. $28b in 2021) SpendingonaRand §=$ 42.6 bi
Slide 8: Transaction Overview - zSpace
edttechx nolangs Transaction Overview - ZSpace (Smilionsexcept share price) Combined Pro forma (1) Enterprise Value $188M Market Cap $219M Committed Anchor PIPE @ $10.15 zSpace Shareholder Rollover Equity 100% $25M 0 i Listed Peer Group TEV/ 23E Rev. (median) © Estimated Growth Profile TEV / 23E Rev
Slide 9: Illustrative Transaction Summary - zSpace
Illustrative Transaction Summary- zSpace X“*™ (Smilions except shre pie) Transaction Summary Pro Forma Valuation ®) * Implied enterprise value of $188M, or 3.4x '23E Revenue of SS6M("! ustrative Share Price $10.15 + Up to $48M cash to balance sheet for continued growth of combined company before tra
Slide 10: zSpace Vision: expanding across the entire learning spectrum
zSpace Vision: expanding across the entire learning spectrum
Slide 11: Investment Highlights
Investment Highlights 1
Slide 12: zSpace Introductory Video
zSpace Introductory Video
Slide 13: Company Snapshot
Company Snapshot Leading commercial provider of AR/VR technology, focused on the Education & Training sector By the Numbers Industry Recognition A Customer Base with the Largest US School Districts*** Us Space Customer Studentst*** 207 AWARDS $56M 54% New York City 984k "1 EXCELLENCE FY23E FY22E - F
Slide 14: zSpace Education Market Offers a Large Opportunity (>$200B)
zSpace Education Market Offers a Large Opportunity* ( > $200B) eMeA pe APAC™ $78.88 $2.5B Mi ~$205B TAM(K-12) Ml ~$14B TAM (Career Tech Ed [CTE] / Workforce) ‘Source: National Center for Education Statistics, Ministries of Education in various countries. “lab per school. India included in K12, but n
Slide 15: US Market Opportunity is Bolstered by US Federal Stimulus >$280B
US Market Opportunity is Bolstered by US Federal Stimulus >$280B Covid-19 legislation has added funding to K-12 education, adding growth potential CARES Act Covid Relief Package American Rescue Plan Signed into Law Signed into Law Signed into Law March 2020 December 2020 March 2021 Education Total $
Slide 16: Validated Efficacy with AR/VR in Education and Workforce Training
Validated Efficacy with AR/VR in Education and Workforce Training zSpace Xx 16
Slide 17: Technology
Technology Hardware Continuously developing new products for existing and new markets Original Versions New Generation Classroom Lab Model One-to-One Model YJ | Alo Laptop Inspire Commercially launched Q1/2022 Professional Education/K12 High-Performance Key Partnership with Major PC OEM = Leverage t
Slide 18: Technology Differentiation
Technology Differentiation zSpace's differentiated, easy-to-use and affordable technology has contributed to its success Unique Features Comfortable Viewing ¥ Proprietary 3D panel module ANS ¥ Lightweight eyewear ¥ Full Motion Parallax Perception of Depth Integrated Experience v AR/VR combined with
Slide 19: Proven solution with real evidence and customers
Proven solution with real evidence and customers... Every time | visit a zSpace class, the kids are 100 percent engaged, they absolutely love it and they can’t wait to get a visitor's attention and share what they are doing. SARAH EDWARDS District Supervisor of Instructional Technology Buffalo Publi
Slide 20: Software Ecosystem Content Driving Highly-Recurring Revenue
Software Ecosystem Content Driving Highly-Recurring Revenue Broad application offering (both zSpace and 3rd party), including hundreds of activities* aligned with NGSS and state standards Curriculum Areas Covers Physical ‘Advanced al utom Powe | seis EI sali regis biased K-12 Application Examples CT
Slide 21: Select K12 and Workforce Experiential Learning Applications
Select K12 and Workforce Experiential Learning Applications Industry Credentials s 8 pars 2 a a ee cD as Space + Esports. An immersive experience beyond gaming. ( A zSpace {se 2
Slide 22: Immersive and engaging zSpace and 3rd party content
Immersive and engaging zSpace and 3rd party content Space Xx 22
Slide 23: Technology Differentiation
Technology Differentiation zSpace's differentiated, easy-to-use and affordable technology has contributed to its success { eS + Significant Customer Installed Base aes af 7 + Robust software content zSpace BB Oo + 3°4 Party Developers for scale Meta Suomen ~ * K12/STEM & CTE/Workforce market ne ) op
Slide 24: The recent metaverse excitement about immersive virtual experiences...
The recent metaverse excitement about immersive virtual experiences... Why you should care about Facebook's big push into the metaverse Why AR, not VR, will be the heart of the metaverse axel Everybody Into the Metaverse! irtual Reality Beckons Big Tech. zSpace fe 24
Slide 25: ..has been zSpace's core vision for the past years
..has been zSpace's core vision for the past 10 years Our focus on immersive experiences has made us a leading education technology in the metaverse Forbes The Missing Link In A Metaverse-For-All Vision Jan 18, 2022 “Given the fundamental technology zSpace has demonstrated | believe that the PC and
Slide 26: Key Strategic Growth Pillars
Key Strategic Growth Pillars Our execution plan includes multiple avenues for continued growth over the next several years Continued US International Software organic growth Expansion Acquisitions zSpace ss3< 26
Slide 27: Sales & Marketing Growth Plans
Sales & Marketing Growth Plans US Key Initiatives = New Customer Acquisition 4 zSpace Existing Customer Expansion through zSpace Inspire = Continued Virtual/Hybrid selling model eSports Initiative ene ots sec 2 » US Channel Strategy = US Stimulus Funding Focus - ESSER and CARES implementations Inter
Slide 28: International Reseller Footprint
International Reseller Footprint Strong and growing position in leading markets across the world International customers in over 50 countries through over 25 major resellers Success in US education ing demand Major projects in 2021 is expected to set up 2022 well = Argentina ) = Eastern Europ. Z Spa
Slide 29: Acquisitions - Annual Recurring Revenue (ARR)
Acquisitions - Annual Recurring Revenue (ARR) Acquisitions - Key Criteria Pipeline of 50+ targets * Focus on key software applications * Prioritized focus on top 5 targets within K12/STEM & CTE/Workforce * Could add $2m ARR to 2022 * Stable revenues, higher margins, Revenue, >$30m in Revenue in scal
Slide 30: Near-Term Priorities
Near-Term Priorities Continue US organic growth Execute on software M&A pipeline zSpace Xs International Expansion Go public 30
Slide 31: 2021 - 2024E Financial Projection Metrics - Base Case
2021 - 2024E Financial Projection Metrics - Base Case 100 40.0 an 8 30.0 60 a a 202 40 — 70) oo : 13:70 . - CJ 20 M ° . 2021 2022e 2023e 2021 2022e 2023e 20246 Operating Profits (Simm ee (Smm) $35.0 $33.0 60 48 $30.0 $24.7 40 $25.0 20 $20.0 $179 : ae $15.0 Z (20) 2021 2022e 2023e 20246 es (4.0) 5. (
Slide 32: 2021 - 2024E Financial Metrics
2021 - 2024E Financial Metrics Revenues by Region* Revenues by Category 90.0 90.0 84.2 84.2 80.0 80.0 70.0 70.0 60.0 56.1 60.0 56.1 50.0 50.0 40.0 ara” 40.0 aa? 30.0 26.7 30.0 26.7 20.0 20.0 10.0 10.0 : 2021 2022e 2023e 20240 . 2021 2022e 2023¢ 2024e Americas mAPAC/EMEA China mHardware 1m Software &
Slide 33: Strong bookings that convert to revenues in 2022/2023
Strong bookings that convert to revenues in 2022/2023 Forecasted revenue growth supported by Fulfillment of Booked Orders, ARR and Targeted Programs 40 60 1 37 3 56 at oe New Business. US$ mm) 8 8 ZSPace jeter preyeseor orn + Based on Management estimates and subject to change. 8
Slide 34: Sales Results - Best Q1 in Company History with strong Pipeline
Sales Results - Best Q1 in Company History with strong Pipeline: 59% Bookings Growth Y-o-Y 30% Revenue Growth Y-0-Y Pipeline 3 ism) Approx. $90m total 10 9 8 7 6.0m 6 5 4.7m 4 B Stage 121 : BB Initial Vision/Gaining buy-in 2 Due Diligence Lee Funding 122 [Bl Approval/Procurement Booking Revenue? ZSP
Slide 35: Peer Group Analysis and Operational Benchmarking
Peer Group Analysis and Operational Benchmarking zSpace Xx 35
Slide 36: Peer Benchmarking - Valuation Metrics
Peer Benchmarking - Valuation Metrics {smiton) \Chegg’ [Prmroet ssn votingo coursera docebo: Kihoot! aréo Gdemy | Market Cap $2465 $2027 $2523 $3274 $2496 $1121 «$1456 «8947 ev 29m 3277 | 2945 | 2729 | 167d | ots ages 080 EdTech (subscription) Metaverse/AR/VR vn | Cveto Spe Qn (eae Sah t (oo =o me q
Slide 37: Peer Benchmarking - Financial Metrics
Peer Benchmarking - Financial Metrics {smiton) EdTech (subscription) €¥ 226 Revenu CY 236 Revenu cy22ecsiTOA| NA, Cy23EESTOA) NA 20 209 191 cy 2281 — | 1 Growh {eva Rend rcenee Crain 6135 revenue CAGR (CY 22E Grose Margin CY 236 Gross Margin ‘Cy 226 EBITDA Margin ‘cv 23€ EBITDA Margin Se Cong ing Ca
Slide 38: Leadership Team
Leadership Team © © @ @ © Joe Powers Tara (Bee | Chie! ive ( Chief Financial Off f Revenue ¢ (Bee | le OF Prior to 2Space, Paul was CEO Joe has over 20 years Mike has more than 20 years. Ronhas over two decades of Tara brings over 12 years of for Chancery Software, an ‘experience in senior level of
Slide 39: Appendix
zSpace Xx Appendix 39
Slide 40: Illustrative Proforma zSpace Balance Sheet
Illustrative Proforma zSpace Balance Sheet (Prior to Business Combination With EdtechXx) (Notes and Assumptions 1) zSpace Inc. - March 31, 2022 ending balance sheet. (unaudited) + 2) 2Space remaining Debt: East $4M drawn unde’ West Bank (EWB) senior debt facility. e sha 's debt conversion/ umitted P
Slide 41: Illustrative Use of Funds Post Merger
Illustrative Use of Funds* Post Merger Operating Activities Capital Expenditures 1% 1% Repayment of Bank Line 17% NG Acquisitions 54% a Product Development (NRE) 21% * Assumes $24M minimum cash from EDTX trust after payment of EdtechX expenses (est $6m) and net of debt retirement
Slide 42: Risk Factors
Risk Factors isks Related to zSpace's Business and Industry Follo ZSpace has a limited operating history at the current scale of its business and is still scaling up its monetization efforts, which makes it difficult to evaluate its current business and future prospects, and there is no assurance it
Slide 43: Risk Factors (Cont.)
Risk Factors (Cont.) Risks Related to Financial and Accounting Matters ‘2Space's operating results may fluctuate significantly, which makes its future results dificult to predict. + Certain of 2Space's market opportunity estimates, growth forecasts and key metrics could prove to be inaccurate, and a
Slide 44: Risk Factors (Cont.)
Risk Factors (Cont.) Risks Relate tothe Business Combination Public stockholders, together with any affliates of theirs or any other person with whom they are acting in concert or asa “group,” willbe restricted from seeking redemption Fights with respect to more than 15% of the public shares. + Edhe