MACRO ENERGY LTD (TO BE RENAMED ‘DIGITAL CC LIMITED’) ABN 59 009 575 035

PROSPECTUS

For an offer of up to 45,500,000 Shares (on a post-Consolidation basis) at an issue price of $0.20 per Share to raise up to $9,100,000 (Offer).

Please refer to Section 5.1 for further details.

The Offer is conditional on (amongst other things) events described in Section 2.5.

This Prospectus is a re-compliance prospectus for the purposes of satisfying Chapters 1 and 2 of the ASX Listing Rules and to satisfy ASX requirements for re-listing following a change to the nature and scale of the Company’s activities.

IMPORTANT INFORMATION

This is an important document that should be read in its entirety. If you do not understand it you should consult your professional advisers without delay.

The Securities offered by this Prospectus should be considered highly speculative.

1.	CORPORATE DIRECTORY .............................................................................................. 1
2.	IMPORTANT NOTICE ..................................................................................................... 2
3.	CHAIRMAN’S LETTER ..................................................................................................... 4
4.	INVESTMENT OVERVIEW ............................................................................................... 6
5.	DETAILS OF THE OFFER ................................................................................................ 28
6.	BACKGROUND ON DIGITAL CURRENCIES ................................................................. 31
7.	BACKGROUND ON DIGITAL CC AND ITS PROPOSED BUSINESS ............................... 37
8.	FINANCIAL INFORMATION......................................................................................... 45
9.	RISK FACTORS ............................................................................................................ 64
10.	BOARD, MANAGEMENT AND CORPORATE GOVERNANCE ..................................... 75
11.	MATERIAL CONTRACTS .............................................................................................. 79
12.	ADDITIONAL INFORMATION ...................................................................................... 91
13.	DIRECTORS’ AUTHORISATION .................................................................................. 108
14.	GLOSSARY ................................................................................................................ 109

INDICATIVE TIMETABLE*

Lodgement of Prospectus with the ASIC	12 May 2014
Opening Date of Offer	12 May 2014
Closing Date of Offer	19 May 2014
Settlement of the Acquisition and issue of Vendor Consideration	26 May 2014
Securities
Issue of Shares under the Offer	26 May 2014
Despatch of holding statements for the Offer	27 May 2014
Expected date for reinstatement to quotation on ASX	4 June 2014

* The above dates are indicative only and may change without notice. The Company reserves the right to extend the Closing Date or close the Offer early without notice.

1. CORPORATE DIRECTORY

Directors

Registered Office

Brett Lawrence

Managing Director and Chairman (Proposed Non-Executive Director)

Level 7, 1008 Hay Street PERTH WA 6000

Mark Freeman Non-Executive Director

Scott Jones Non-Executive Director

Telephone: + 61 8 9389 2000 Facsimile: +61 8 9389 2099

Email: [email protected] Website: www.macroenergyltd.com.au

Share Registry*

Proposed Directors

Eugeni ’Zhenya’ Tsvetnenko Proposed Executive Chairman

Alex Karis Proposed Managing Director/CEO

Computershare Investor Services Pty Limited Telephone: +61 8 9323 2000 Facsimile: +61 8 9323 2033

Investigating Accountant and Auditor

William Brindise Proposed Executive Director Chief Investment Officer

Adeniyi ‘Emmanuel’ Olalekan Abiodun Proposed Non-executive Director

Deloitte Corporate Finance Pty Limited Level 14, Woodside Plaza 240 St Georges Terrace PERTH WA 6000

Solicitors to the Company

Company Secretary

Rachel Jelleff

Clayton Utz* Level 27, QV1 Building 250 St Georges Terrace PERTH WA 6000

Proposed ASX Code

Solicitors to Digital CC

DCC

Steinepreis Paganin Level 4, The Read Buildings 16 Milligan Street PERTH WA 6000

HHG Legal Group* 1/16 Parliament Place WEST PERTH WA 6005

*These entities are included for information purposes only. They have not been involved in the preparation of this Prospectus.

2. IMPORTANT NOTICE

This Prospectus is dated 12 May 2014 and was lodged with the ASIC on that date. The ASIC and its officers take no responsibility for the contents of this Prospectus or the merits of the investment to which this Prospectus relates.

No Shares or Options may be issued on the basis of this Prospectus later than 13 months after the date of this Prospectus.

No person is authorised to give information or to make any representation in connection with this Prospectus, which is not contained in the Prospectus. Any information or representation not so contained may not be relied on as having been authorised by the Company in connection with this Prospectus.

It is important that you read this Prospectus in its entirety and seek professional advice where necessary. The Shares and Options the subject of this Prospectus should be considered highly speculative.

2.1 Website – Electronic Prospectus

A copy of this Prospectus can be downloaded from the website of the Company at www.macroenergyltd.com.au. If you are accessing the electronic version of this Prospectus for the purpose of making an investment in the Company, you must be an Australian resident and must only access this Prospectus from within Australia.

The Corporations Act prohibits any person passing onto another person an Application Form unless it is attached to a hard copy of this Prospectus or it accompanies the complete and unaltered version of this Prospectus. You may obtain a hard copy of this Prospectus free of charge by contacting the Company.

The Company reserves the right not to accept an Application Form from a person if it has reason to believe that when that person was given access to the electronic Application Form, it was not provided together with the electronic Prospectus and any relevant supplementary or replacement prospectus or any of those documents were incomplete or altered.

2.2 Website

No document or information included on our website is incorporated by reference into this Prospectus.

2.3 Forwarding-looking statements

This Prospectus contains forward-looking statements which are identified by words such as ‘may’, ‘could’, ‘believes’, ‘estimates’, ‘targets’, ‘expects’, or ‘intends’ and other similar words that involve risks and uncertainties.

These statements are based on an assessment of present economic and operating conditions, and on a number of assumptions regarding future events and actions that, as at the date of this Prospectus, are expected to take place.

Such forward-looking statements are not guarantees of future performance and involve known and unknown risks, uncertainties, assumptions and other important factors, many of which are beyond the control of our Company, the Directors and our management.

We cannot and do not give any assurance that the results, performance or achievements expressed or implied by the forward-looking statements contained in this Prospectus will actually occur and investors are cautioned not to place undue reliance on these forward-looking statements.

We have no intention to update or revise forward-looking statements, or to publish prospective financial information in the future, regardless of whether new information, future events or any other factors affect the information contained in this Prospectus, except where required by law.

These forward looking statements are subject to various risk factors that could cause our actual results to differ materially from the results expressed or anticipated in these statements. These risk factors are set out in Sections 4.4 and 9 of this Prospectus.

2.4 Photographs and Diagrams

Photographs used in this Prospectus which do not have descriptions are for illustration only and should not be interpreted to mean that any person shown endorses the Prospectus or its contents or that the assets shown in them are owned by the Company. Diagrams used in this Prospectus are illustrative only and may not be drawn to scale.

2.5 Conditional Offer

The Offer is conditional on events described in Sections 4.9 and 5.5.

In the event that those events do not occur, the Offer will not proceed and no Shares will be issued pursuant to this Prospectus. If this occurs, Applicants will be reimbursed their application monies (without interest).

2.6 Consolidation

Unless otherwise stated, all references in this Prospectus are made on the basis that the 5.715:1 Consolidation, for which Shareholders’ approval was received at the General Meeting of the Company held on 9 May 2014 (General Meeting), has taken effect.

3. CHAIRMAN’S LETTER

Dear Investor

The Board of Macro Energy Ltd (the Company) are excited to present you with this Prospectus and the opportunity to become a shareholder in the Company, which proposes to acquire all the shares of Digital CC Holdings Pty Ltd (Digital CC) – an Australian company focused on the emerging global digital currency sector, a sector with immense growth potential.

Digital currencies enable fast and extremely low cost methods of payment and money transfer – anywhere in the world and at any time – using the internet.

Digital CC

Digital CC is a recently incorporated company, currently operating and generating significant revenues from digital currency mining and its arbitrage and liquidity desk. Their business is presently focused on three areas of the digital currency sector, as summarised below and explained in more detail within the Prospectus:

Digital Currency Mining

Involves buying state of the art mining hardware, mining Bitcoins and then selling the hardware as required to keep at the forefront of technology (ideally within two to six months of purchase). Bitcoins mined can be liquidated to traditional currencies (AUD, USD, Euro etc.)

Digital Currency Arbitrage and Liquidity Desk

The trading desk principally supplies liquidity and undertakes arbitrage activities for digital currencies such as Bitcoin, through major internationally recognised exchanges using specialised strategies which include buying long positions, selling short positions, futures contracts and market making.

Development of Retail Products and Applications

The aim with these products is to capture the rapidly increasing demand for simple and easy to use digital currency applications.

Digital CC’s performance to date has seen it generate in excess of 1,700 Bitcoins in its first 42 days from the first instalment of mining hardware on 20 March 2014.

Revolutionary

The arrival of the internet has seen many traditional industries radically changed in a very short space of time. The application of new technology and services delivered over the internet have the potential to disrupt many industries and create new revenue and market opportunities based entirely on digital goods and services.

Digital currencies have the potential to affect similar disruptive change and growth. Digital currencies, such as Bitcoin, when used for the payment of internet based digital services or simply for the remittance of funds via the internet, have great potential for growth. This growth will be based on the ease of use of these new digital currencies and the potential for lower fees compared to traditional payment mechanisms.

The Board believes that this investment opportunity positions the Company for the now unfolding mainstream arrival of digital currencies – providing a unique and exciting opportunity to be part of a growing change in the nature of payments and money transfers made over the internet.

The Company, through its proposed acquisition of Digital CC, is poised to maximise future strategic opportunities within the digital currency sector, with funds raised by this Prospectus to be used to accelerate such endeavours.

Investors should be aware of the potential risks inherent in this investment, as fully detailed in this Prospectus.

Yours sincerely

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Brett Lawrence Chair and Managing Director

4. INVESTMENT OVERVIEW

This Section is a summary only and is not intended to provide full information for investors intending to apply for Securities offered pursuant to this Prospectus. This Prospectus should be read and considered in its entirety.

4.1 The Company

The Company is listed on the official list of the Australian Securities Exchange.

On 13 March 2014, the Company announced that it had executed the Agreement, being a binding conditional share purchase agreement to acquire 100% of the issued capital in Digital CC, an Australian proprietary company focussed on developing opportunities in the digital currency sector, including Bitcoin.

The Company has subsequently convened the General Meeting to seek the approval of its Shareholders of the acquisition of Digital CC and the change in the nature and scale of the Company’s business and operations to enable the Company to focus on developing opportunities in the digital currency sector. The General Meeting was held on 9 May 2014. All resolutions considered at the General Meeting were approved by Shareholders, including resolutions numbered 1-6 inclusive which related to approval of the Acquisition, the Offer and related matters (Acquisition Resolutions).

4.2 Digital CC

Digital CC proposes to conduct, develop and/or acquire the businesses of digital currency trading and investment, digital currency (focussing on Bitcoin) mining and the potential development of consumer based products. Section 7 of this Prospectus provides a detailed description of these proposed business developments. Section 6 provides a background and summary on the digital currency market and sector.

In accordance with the terms of the Agreement and with effect from the completion of the Acquisition, two of the existing Directors of the Company will retire and four nominees of Digital CC, (the Proposed Directors), will be casually appointed to the Board of the Company. The Proposed Directors are:

(a) Eugeni ‘Zhenya’ Tsvetnenko (Proposed Executive Chairman);
(b) Alex Karis (Proposed Managing Director/CEO);
(c) William Brindise (Proposed Executive Director and Chief Investment Officer); and
(d) Adeniyi ‘Emmanuel’ Olalekan Abiodun (Proposed Non-Executive Director).

The Proposed Directors all have previous experience in either the digital or digital currency sectors relevant to the Company’s proposed new direction and will bring that experience to the Company. Further information in relation to the Proposed Directors, including their respective biographical information is provided in Section 4.17 below.

4.3 Key Investment Highlights

The Directors consider that the four key highlights relating to an investment in the Company include:

(a) New emerging and developing sector – digital currencies have continued to grow in their use and recognition as a mainstream form of currency. Digital CC aims to be at the forefront of this emergence into the mainstream.
(b) Experienced management – the Proposed Directors are all experienced in the technology or digital currency areas, and have achieved previous success with business activities in their areas. They each expect to be able to leverage off their previous success as they develop the Digital CC business.
(c) First ASX listed digital currency miner and trader – following completion of the Transaction, the Company proposes to become the first ASX listed company focussed on the mining and trading of digital currencies, particularly Bitcoin.
(d) Opportunity to leverage off the growth in scope of Digital CC as the digital currency market matures, as the digital currency market grows, the Directors consider that as an ASX listed company, Digital CC can be well placed, with access to funding and an experienced Board to leverage off that growth.

4.4 Key Risks

The business, assets and operations of the Company and Digital CC are subject to certain risk factors that have the potential to influence the financial position, prospects and the operating and financial performance of the Company and Digital CC in the future. These risks can impact on the value of an investment in the Securities of the Company and the price of those Securities.

The key risks associated with an investment in the Company after the proposed acquisition of Digital CC are summarised in this Section 4.4. More detailed summaries and further risks concerning an investment in the Company are set out in Section 9. Investors are advised to consider these risks carefully before deciding whether to apply for Securities pursuant to this Prospectus. Refer to Section 6 for an explanation of technical terms relating to digital currencies, such as Bitcoin ‘mining’.

(a) Increased regulation may adversely affect and reduce the appeal of Bitcoin and other digital currencies

The Bitcoin network was primarily designed to operate free from third party regulation and as such modifying Bitcoin’s protocols to facilitate regulation poses a problem. In order for such intervention to be possible, the majority of the Bitcoin network would need to agree to allow it; however the likelihood of this eventuating is minimal. Therefore, regulators will need to look outside the network when considering the rules they may impose on individuals and businesses that use digital currencies such as Bitcoin.

Some governments have already imposed restrictions on Bitcoins; examples of these regulations are set out below:

Thailand – Thailand was the first country to ban the use of Bitcoin, making it illegal to buy and sell Bitcoins, buy and sell goods or services in exchange for Bitcoins or send/receive any Bitcoins to/from someone outside Thailand.
China – The Chinese government has prohibited its banks from trading in virtual currencies.
Russia – Russia’s Prosecutor General’s Office released a statement saying “Systems for anonymous payments and cyber currencies that have gained considerable circulation, including the most wellknown, Bitcoin – are money substitutes and cannot be used by individuals or legal entities”, which effectively bans Bitcoin use in Russia.
Vietnam – Vietnam’s central bank has banned credit institutions from trading in Bitcoin.

The primary risk facing Bitcoin and other digital currencies is that if more jurisdictions ban their use, the available market for such digital currencies falls. The announcement of China’s regulations caused a significant fall in the Bitcoin price to US$348 on 11 April 2014. Furthermore, the increased use of digital currencies and the very public collapse of Mt Gox (previously the largest Bitcoin exchange) are likely to result in further regulation from governments looking to protect investors. Such regulation may further affect the price.

As Digital CC’s business concerns investment in and ownership of digital currencies, including Bitcoin, the risks of currency exchanges shutting down, loss of digital currency, increased government regulation and changes in the prices of digital currencies may adversely affect the business of Digital CC and consequently the Company.

An example of recent regulatory action in relation to Bitcoin is the closure of the website ‘Silk Road’ by authorities in the U.S.A.

In October 2013, the United States Federal Bureau of Investigation arrested Ross William Ulbricht, allegedly the owner of Silk Road and shutdown the website. As part of the operation, the FBI also seized control of 144,000 Bitcoins. The arrests made by the FBI in connection with Silk Road brought attention to the fact that Bitcoin transactions are not completely anonymous. Since every transaction is recorded in the Blockchain, it is possible to trace every transaction to other wallets.

(b) Taxation and Bitcoin

The increased prevalence of Bitcoin and other digital currencies has attracted the attention of tax authorities. While some tax authorities have not yet addressed the issues raised by Bitcoin, some have been outspoken with their views. Specifically, the United Kingdom’s HM Revenue & Customs have stated that mining would not be subject to value added tax (the UK’s equivalent of GST) however transactions conducted between consumers and merchants would be subject to value added tax and any revenue generated from digital currency sales would be subject to income tax.

The Australia Tax Office (ATO) has not yet made any formal rulings on the tax treatment of Bitcoin and other digital currencies. The ATO has

recently announced that it expects to issue guidance on the taxation treatment of Bitcoin by 30 June 2014.

(c) Reinstatement to ASX’s official list

The Company’s Shares were suspended prior to all resolutions being passed at the General Meeting. It is anticipated that the Company’s Securities will remain suspended until completion of the Agreement, Capital Raising and Consolidation, re-compliance by the Company with Chapters 1 and 2 of the ASX Listing Rules and compliance with any further conditions ASX imposes on such reinstatement. There is a risk that the Company will not be able to satisfy one or more of those requirements and that its listed Securities may consequently remain suspended from quotation.

(d) Forecasts

The Directors consider that it is not possible to accurately predict the future revenues or profitability of the Company or Digital CC’s business or whether any revenues or profitability will eventuate. The business of the Company and Digital CC are dependent upon a number of factors and many of these factors are outside the control of the Company. Consequently the Company, the Directors and the Proposed Directors do not make any forecast or representation in relation to the Company or Digital CC’s future financial position or performance.

(e) Unforeseen expenditure risk

Expenditure may need to be incurred that has not been taken into account in the estimates summarised in Section 4.11. Although the Company is not currently aware of any such additional expenditure requirements, if such expenditure is subsequently incurred, this may adversely affect the expenditure proposals of the Company and the Company’s and Digital CC’s proposed business.

(f) Development and commercialisation of products

The Company is relying on its objective of acquiring Digital CC to seek to develop Digital CC technologies. A failure to successfully develop and commercialise these products could lead to a loss of opportunities and adversely impact on the Company’s operating results and financial position.

(g) Volatility

Bitcoins (and other digital currencies) are a volatile cryptocurrency and fluctuations in their price will have impact on Digital CC and consequently the Company, if the Acquisition occurs, given that Digital CC’s business concerns the ownership, mining, trading and development of products for cryptocurrencies such as Bitcoins. In addition, there is no assurance that Bitcoins or any other digital currency which the Company or Digital CC may acquire an interest in will maintain their long-term value in terms of purchasing power in the future or that the acceptance of digital currency payments by mainstream retail merchants and commercial businesses will grow. In the event that the price of Bitcoins (or any other digital currency which the Company or Digital CC may acquire an interest) declines, this would likely adversely impact the value of Digital CC and consequently the

Company (subject to any potential trading by Digital CC on such market volatility).

The further development and acceptance of the Bitcoin network and other digital currencies, which represent a new and rapidly changing industry, are subject to a variety of factors that are difficult to evaluate. The slowing or stopping of the development or acceptance of the Bitcoin network may adversely affect the Company and Digital CC.

(h) Bitcoin theft and security of private key

It is possible for Bitcoins and other digital currencies to be stolen. Bitcoins are controllable by the possessor of both the unique public and private key relating to the local or online digital wallet in which the Bitcoins are held, which wallet’s public key or address is reflected in the Bitcoin network public Blockchain. Digital CC publishes the public key relating to digital wallets it uses when it verifies the receipt of Bitcoin transfers and disseminates such information into the Bitcoin network, but is required to safeguard the private keys relating to such digital wallets.

Digital CC stores its digital currency which is not in use in "cold storage"; or in other words, not online. Normally, wallets hold both private and public keys. The public keys are the addresses that are given out in order to receive funds to that wallet. As per the Bitcoin protocol, anyone knowing a public address can view the transactions made with that address. On the other hand, private keys are by definition private to the owner of the wallet. It is this key that is used by the owner when spending Bitcoins (to sign transactions). If an owner has a weak password protecting the private keys, a hacker could break the password and have complete access to the wallet. Digital CC protects against this by storing the private keys on a computer that is never connected to the internet (i.e. cold storage) so the public keys and private keys are on two separate computers.

The computer holding the private keys is locked up in a safe in a secure environment. Not only do the private keys have extremely complex and strong password protection, the partition holding the keys is encrypted. To create a transaction, the request is generated from the computer holding public keys which creates a message envelope containing all the information that is needed, except for the private key signature. The only way to execute the transaction is to take the message envelope to the secured, encrypted offline computer and generate the signature with the private keys, and then the signed message is brought back and transmitted to the network from the first computer. Digital CC not only physically separates the public and private keys, it also physically separates the computers running each part of the wallet. Further, in the event of a computer failure, the private keys are stored in an offsite secured facility, within an encrypted device.

To the extent such private keys are lost, destroyed or otherwise compromised, Digital CC will be unable to access the related Bitcoins and such private keys will not be capable of being restored by the Bitcoin network.

The loss or destruction of a private key required to access a Bitcoin may be irreversible. Any loss of private keys relating to digital wallets used to store Digital CC’s Bitcoins or its experience of a data loss relating to

Digital CC’s Bitcoins could adversely affect Digital CC’s business and an investment in that business.

(i) Open source software risks

Bitcoin is an open source project. Although there is an influential group of leaders in the Bitcoin network community including developers, there is no official developer or group of developers that formally controls the Bitcoin network. Any individual can download the Bitcoin network software and make any desired modifications, which are proposed to users and miners on the Bitcoin network through software downloads and upgrades. However, miners and users must consent to those software modifications by downloading the later software or upgrade implementing the change; otherwise, the changes do not become a part of the Bitcoin network.

Since the Bitcoin network’s inception, changes to the Bitcoin network have been accepted by the vast majority of users and miners. However, a developer or group of developers could potentially propose a modification to the Bitcoin network that is not accepted by a vast majority of miners and users, but that is nonetheless accepted by a substantial population of participants in the Bitcoin network. In such a case, a fork in the Blockchain could develop and two separate Bitcoin networks could result, one running the pre-modification software program and the other running the modified version (i.e., a second “Bitcoin” network). Such a fork in the Blockchain typically would be addressed by community-led efforts to merge the forked Blockchains, and several prior forks have been merged. This kind of split in the Bitcoin network could materially and adversely affect the price and value of Bitcoins and potentially harm the sustainability of the Bitcoin economy.

(j) Bitcoin exchanges risks

Bitcoin exchanges are electronic marketplaces where exchange participants may trade, buy and sell Bitcoins based on bid-ask trading. The largest Bitcoin exchanges are online and typically trade on a 24hour basis, publishing transaction price and volume data.

There is a risk of Bitcoin exchanges experiencing technical difficulties, being hacked or shut down, with the consequence of clients of such exchanges (including Digital CC and its related entities) losing their Bitcoins. For example Digital CC’s group has lost access to 351 Bitcoins due to the Mt Gox Bitcoin exchange shutting down during February 2014 and it is unclear as to whether those Bitcoins will be returned to Digital CC’s group.

The Bitcoin exchanges on which the Bitcoins trade are new and largely unregulated.

Recently, many Bitcoin exchanges have been closed due to fraud, failure or security breaches. In many of these instances, the customers of such Bitcoin exchanges were not compensated or paid for the partial or complete losses of their account balances of Bitcoins in such Bitcoin exchanges. While smaller Bitcoin exchanges are less likely to have the infrastructure and capitalisation that make larger Bitcoin exchanges more stable, larger Bitcoin exchanges are more likely to be appealing targets for hackers and “malware” (i.e., software used or programmed

by attackers to disrupt computer operation, gather sensitive information or gain access to private computer systems).

(k) Further technology risks

The Bitcoin technology and other digital currencies may be rendered obsolete by new inventions and technologies, which would adversely impact Digital CC and consequently the Company.

Further, the administrators of the Bitcoin network’s source code could propose amendments to the Bitcoin network’s protocols and software that, if accepted and authorized by the Bitcoin network’s community, could adversely affect Digital CC and consequently the Company.

The Bitcoin network is based in a cryptographic, algorithmic protocol that governs the end-user-to-end-user interactions between computers connected to the Bitcoin network. Amendments may occur to the Bitcoin network’s source code through one or more software upgrades that alter the protocols and software that govern the Bitcoin network and the properties of Bitcoins, including the irreversibility of transactions and limitations on the mining of new Bitcoins. To the extent that a significant majority of the users and miners on the Bitcoin network install such software upgrade(s), the Bitcoin network would be subject to new protocols and software that may adversely affect Digital CC and consequently the Company. If less than a significant majority of the users and miners on the Bitcoin network install such software upgrade(s), the Bitcoin network could “fork”. The acceptance of Bitcoin network software patches or upgrades by a significant, but not overwhelming, percentage of the users and miners in the Bitcoin network could result in a “fork” in the Blockchain, resulting in the operation of two separate networks until such time as the forked Blockchains are merged. The temporary or permanent existence of forked Blockchains could adversely impact Digital CC and consequently the Company.

To the extent that malicious actors or a botnet (a volunteer or hacked collection of computers controlled by networked software coordinating the actions of the computers) obtains a majority of the processing power on the Bitcoin network, it could alter the source code and Blockchain on which the Bitcoin network and all Bitcoin transactions rely. To the extent that a malicious actor or botnet does not yield its majority control of the processing power on the Bitcoin network, reversing any changes made to the source code or Blockchain may not be possible.

If malicious actors or a botnet obtain control of over 50 percent of the processing power active on the Bitcoin network, this could manipulate the source code of the Bitcoin network or the Blockchain in a manner that adversely affects Digital CC and consequently the Company and their ability to operate.

(l) Bitcoin mining risks

As the number of Bitcoins awarded for solving a block in the Blockchain decreases, the incentive for miners to continue to contribute processing power to the Bitcoin network will transition from a set reward to transaction fees. The requirement from miners of higher transaction fees in exchange for recording transactions in the Blockchain may decrease demand for Bitcoins and prevent the expansion of the Bitcoin network

to retail merchants and commercial business, resulting in a reduction in the Blended Bitcoin Price.

If transaction fees paid for the recording of a transaction in the Blockchain becomes too high, the marketplace may be reluctant to accept Bitcoins as a means of payment and existing users may be motivated to switch from Bitcoins to another digital currency or back to fiat currency. A decrease in the use and demand for Bitcoins may adversely affect their value and result in a reduction in price and value of Bitcoins.

If the award of Bitcoins for solving blocks and transaction fees for recording transactions are not sufficiently high to incentivise miners, miners may cease expending processing power to solve blocks and confirmations of transactions on the Blockchain could be slowed. A reduction in the processing power expended by miners on the Bitcoin network could increase the likelihood of a malicious actor or botnet obtaining control in excess of 50 percent of the processing power active on the Bitcoin network or the Blockchain, permitting such an actor or botnet to manipulate the source of the Bitcoin network in a manner that adversely affects Digital CC and consequently the Company or their ability to operate.

If transaction fees are not sufficiently high, miners may not have an adequate incentive to continue mining and may cease their mining operations. Miners ceasing operations would reduce the collective processing power in the Bitcoin network, which would adversely affect the confirmation process for transactions and make the Bitcoin network more vulnerable to a malicious actor or botnet obtaining control in excess of 50 percent of the processing power on the Bitcoin network. Any reduction in confidence in the confirmation process or processing power of the Bitcoin network may adversely impact Digital CC and consequently the Company.

(m) Protection of technology rights

Securing rights to technologies, and in particular intellectual property, through licensing or otherwise, is an integral part of securing potential product value in the outcomes of digital currency. Competition in retaining and sustaining protection of technologies and the complex nature of technologies can lead to expensive and lengthy disputes for which there can be no guaranteed outcome.

The Company’s and Digital CC’s prospect of success depends, in part, on their ability to obtain interests in intellectual property, maintain trade secret protection and operate without infringing the proprietary rights of third parties. There can be no assurance that any intellectual property which Digital CC or entities it deals with may have an interest in now or in the future will afford Digital CC or the Company commercially significant protection of technologies, or that any of the projects that may arise from technologies will have commercial applications.

Although the Company will implement all reasonable endeavours to protect Digital CC’s interests in intellectual property, held through its subsidiaries and otherwise, there can be no assurance that these measures have been, or will be sufficient.

Intellectual property rights claims may also adversely affect the operations of the Bitcoin network and consequently Digital CC and the Company.

Third parties may assert intellectual property claims relating to the operation of digital currencies and their source relating to the holding and transfer of such assets. Regardless of the merit of any intellectual property or other legal action, any threatened action that reduces confidence in the Bitcoin network’s (or other digital currencies’) longterm viability or the ability of end-users to hold and transfer Bitcoins may adversely affect Digital CC and consequently the Company.

The above list of risk factors are not to be taken as exhaustive of the risks faced by the Company and you should refer to the non-exhaustive list of additional risk factors in Section 9 of this Prospectus before deciding whether to apply for Securities pursuant to this Prospectus.

4.5 The Acquisition

In exchange for the company acquiring 100% of the issued Shares in Digital CC (the Acquisition), the Company will issue by way of consideration the following to the Vendors (in proportion to their holdings in Digital CC):

(a) 82,764,655 Shares;
(b) 8,316,710 Options;
(c) 16,633,420 Class A Performance Rights; and
(d) 8,316,710 Class B Performance Rights.

A summary of the key terms of the Agreement, including the remaining conditions precedent to be satisfied or waived before the Agreement can be settled is set out in section 11.1 below.

4.6 Effect of the Acquisition

The effect of the Acquisition is that the nature and scale of the activities of the Company will change as the Company proposes to focus on development of the business of Digital CC as outlined in this Prospectus upon completion of the Acquisition. The acquisition of Digital CC is an event which requires the Company to re-comply with the requirements of Chapters 1 and 2 of the ASX Listing Rules, including, among other things, seeking Shareholder approval for the acquisition of Digital CC and the other Acquisition Resolutions, issuing a prospectus and obtaining a sufficient number of Shareholders with the requisite number of Shares in accordance with those rules. At the General Meeting on 9 May 2014, the Company’s shareholders approved all resolutions contained in the Notice of Meeting, satisfying this condition.

The effect of the Acquisition is set out in the capital structure table in Section 4.11 below, the financial information in Section 8 and elsewhere in this Prospectus.

4.7 Business Model, New Business Development and Company Objectives

The Company’s main objectives for the period immediately following reinstatement to quotation on ASX’s Official List will be the development of the business of Digital CC, including:

funding activities to continue Digital CC’s digital currencies trading and mining operation in the digital currency market and related business ecosystems;
funding the development of Digital CC’s proposed products development for the proposed digital products (which are described at Section 7.5) and potential other products, services and investments or other third party ventures as determined by the Proposed Directors from time to time;
investigate the development of potential strategic partnerships with third parties which may encompass acquisitions or developments of complementary businesses to the existing business of Digital CC;
meeting the ongoing costs of the Company and its subsidiaries; and
paying the costs of the matters proposed in the Acquisition and Offer.

4.8 The Offer

The Company invites applications for up to 45,500,000 Shares at an issue price of $0.20 per Share to raise up to $9,100,000. The key information relating to the Offer and references to further details are set out below.

Up to $1,335,675 of the funds to be raised under the Offer may be raised through the conversion of loans currently provided by the Vendors to Digital CC being converted to equity, such that the Company will not raise the full $9,100,000 in cash, but will instead effectively reduce the Company’s liabilities following the closure of the Offer and completion of the Acquisition to create a net effect.

The purpose of the Offer is to position the Company to seek to achieve the objectives set out above in Section 4.7 and to meet the requirements of the ASX and satisfy Chapters 1 and 2 of the ASX Listing Rules. This is sought for the purpose of seeking ASX’s approval for reinstatement of the Company’s Shares to quotation following.

On completion of the Offer, the Board believes our Company will have sufficient working capital to achieve these objectives.

4.9 Conditionality of Offer

The Offer under this Prospectus is subject to a number of conditions, including:

(a) the Company raising the minimum subscription being the full subscription of $9,100,000 under the Offer; and
(b) the remaining conditions precedent to the Acquisition in the Agreement being satisfied (or waived) including the Company receiving conditional approval for re-instatement to trading of the Company’s Shares on ASX.

Further details of the outstanding conditions precedent to completion of the Acquisition are set out in Section 11.1.

If these conditions are not met, the Company will not proceed with the Offer and will repay all application monies received, without interest and in accordance with the Corporations Act.

The Shares offered under this Prospectus will rank equally with the existing Shares on issue.

Further information relating to the Offer is set out in Section 5 and the remainder of this Section 4 below.

4.10 Use of Funds

The Company intends to apply funds raised from the Offer, together with existing cash reserves, as follows over the first two years following reinstatement of the Company to quotation on the official list of ASX after completion of the Acquisition, the Offer and re-compliance with Chapters 1 and 2 of the ASX Listing Rules as set out below.

On completion of the Offer, the Board believes our Company will have sufficient working capital to achieve the objectives set out in Section 4.7.

Funds available	Full Subscription ($) ($9,100,000)	Percentage of Funds (%)
Existing cash reserves of the Company1	$1,300,000	11.36%
Existing cash reserves of Digital CC, comprising working capital2	$1,047,591	9.15%
Funds raised from the Offer2	$9,100,000	79.49%
Total	$11,447,591	100%
Allocation of funds	Total	Percentage of Funds (%)
Repayment of Vendor Loans2	$1,335,675	11.67%
Loan repayment Lydian Enterprises Pty Ltd for funds provided for acquisition of hardware and hosting services3	$2,800,000	24.46%
Investment in Bitcoin mining contracts, hardware and hosting costs4	$2,310,000	20.18%
Investment in Bitcoin trading activities	$1,543,000	13.48%
Development and rollout of the proposed consumer products	$1,800,000	15.72%
Expenses of the Offer5	$775,984	6.78%
Working capital6	$882,932	7.71%
Total	$11,447,591	100%

Notes:

As announced to ASX on 13 March 2014, the Company has provided a $2 million loan facility to enable Digital CC to acquire new Bitcoin mining hardware during the period between the announcement of the Acquisition and the lodgement of this Prospectus. Subsequently, on 3 April 2014, the Company announced that Digital CC had entered into an agreement to acquire new mining hardware from Bitfury. The provision of the loan has had the effect of reducing the Company’s cash reserves by $2,000,000. Refer to Section 11.5 for a summary of the loan facility as well as the Financial Report set out in Section 8 of this Prospectus for further details. It is expected that once the Acquisition is completed, this loan will be forgiven, as Digital CC will be a wholly owned subsidiary of the Company.

The Company obtained the approval of Shareholders at the General Meeting to enable entities associated with the Proposed Directors to participate in the Offer. The Proposed Directors, through their entities have provided and may provide additional loan funds for the purpose of funding the establishment of and the growth of the business of Digital CC since its incorporation, and more specifically during the period since the announcement of the Acquisition. As at the date of the Prospectus, the Directors have loaned to Digital CC a combined amount of $803,321. The effect of the Proposed Directors participating in the Offer, would be that the amount of the outstanding loans, being up to $1,335,675 will be effectively netted off against the cash subscription price of the Shares in the Offer for which the Proposed Directors will subscribe. This will have the effect of reducing the amount of cash that the Company will practically receive under the Offer, but will decrease the debt owing by the Company (owing by Digital CC) to the Proposed Directors by the same amount. This process is the same as if the Proposed Directors paid for the Shares under the Offer and were then repaid their outstanding loan amounts from the proceeds of the Offer.
In addition to point 1 above, since the announcement of the entry into the Agreement on 13 March 2014, the Company has announced the acquisition of new mining hardware from Bitfury (refer ASX announcement dated 3 April 2014) in two instalments in April 2014 with a second instalment due in May 2014. The acquisition of this hardware has been (or will be in the case of the second instalment) funded by loans from the Company, in the amount of $2,000,000 and from Lydian Enterprises Pty Ltd (a Company associated with Proposed Director Zhenya Tsvetnenko) in the amount of approximately $2,800,000. Initially, these funds were intended to come from the Offer, however to avoid any business disruption, it has been important to make these acquisitions prior to completion of the Offer. The hardware has already been used successfully by the Company as announced to ASX on 6 May 2014.
Digital CC’s business, as set out in Section 7, includes, amongst other things, the mining of Bitcoin. This process includes the continued acquisition and upgrade of the hardware, primarily computer chips, used for the mining of Bitcoin.
Refer to Section 12.11 of this Prospectus for further details.
Includes administration costs including the costs of paying salaries to staff, as well as for general corporate costs including rent and the provision of services to the Company.

The above table is a statement of current intentions as of the date of this Prospectus. As with any budget, intervening events, including the outcome of the Company’s proposed activities in the digital currencies sector and its associated business ecosystems, and new circumstances have the potential to affect the manner in which the funds are ultimately applied. The Board reserves the right to alter the way funds are applied on this basis.

4.11 Capital Structure

The capital structure of the Company before and following completion of the Consolidation, the Offer and the issue of the Vendor Consideration Securities is summarised below[1] :

	Shares	Options	Performance Rights
Current issued capital (prior to the Consolidation)1	217,607,664	16,000,0003	Nil
Proposed issue of Options for services provided unrelated to the Acquisition4	Nil	6,000,0004	Nil
Estimated issued capital following the proposed Consolidation1	38,076,581	3,849,5185	Nil

Proposed issue of Vendor Consideration Securities	82,764,655	8,316,7106	24,950,1307
Proposed issue pursuant to the Offer2	45,500,000	Nil	Nil
Capital raising fee8	1,600,000	Nil	Nil
Total estimate on completion9	167,941,236	12,166,228	24,950,130

Notes:

Shareholders have approved the consolidation of the Company’s Shares on a 1 for 5.715 basis to facilitate the Company’s application for re-instatement to trading on ASX. The capital structure table assumes no existing Options are exercised. The post-Consolidation issued capital of the Company is only an estimate and is subject to variation, for example arising from rounding of individual Security holdings.
Assumes the Offer is successful and 45,500,000 Shares are subscribed for and issued.
Existing unlisted Options (on a pre-Consolidation basis) on the terms set out in Section 12.4.
Unlisted Options proposed to be issued to a service provider of the Company, Sibella Capital Pty Ltd (ACN 108 289 818) exercisable for $0.05 each (on a pre-Consolidation basis) on or prior to 30 June 2017 and on a post-Consolidation basis those Options will have the terms set out in Section 12.5. Sibella Capital Pty Ltd is not a related party of the Company.
On a post-Consolidation basis these are unlisted Options, exercisable at $0.286 each on or before 30 June 2017 and on the terms set out in Sections 12.4 and 12.5.
New Options on the terms set out in Section 12.3, which will be unlisted.
The Performance Rights are as follows:
(a) 16,633,420 unlisted Class A Performance Rights on the terms set out in Section 12.6; and
(b) 8,316,710 unlisted Class B Performance Rights on the terms set out in Section 12.7.
Pursuant to the terms of the DJ Carmichael Mandate summarised in Section 11.4, the Company is obliged to issue these Shares as consideration for DJ Carmichael’s role advising the Company in relation to the Acquisition and Offer.
The fully diluted number of Shares on issue in the Company on completion of the Offer, offer of Vendor Consideration Securities and matters contemplated by all Acquisition Resolutions and other resolutions approved at the General Meeting, on a postConsolidation basis, assuming all Options are exercised and Performance Rights vest, will be approximately 205,057,594 Shares.

4.12 Substantial Shareholders

Those Shareholders holding 5% or more of the Shares on issue both as at the date of this Prospectus and as estimated on completion of the Acquisition and Offer (assuming full subscription under the Offer) are set out in the respective tables below.

As at the date of the Prospectus (on a pre-consolidation basis)

Shareholder	Shares	%
Hoperidge Enterprises Pty Ltd as trustee for the Jones Family Trust	58,263,239	26.77%
Craig Ian Burton and Alba Capital Pty Ltd	54,518,	25.05%
Scott Paul Jones, Carol Robin Jones & Rodney Malcolm Jones	12,893,010	5.92%

On completion of the Offer and the Acquisition assuming no Options are exercised and no Performance Rights Vest

Shareholder	Shares	Substantial shareholding %	Options	Class A Performance Rights	Class B Performance Rights
Lydian Enterprises Pty Ltd ATF Lydian Trust	42,500,4111	25.31%	2,495,013	7,787,767	3,893,883
Digital Man LLC	20,514,2002	12.22%	2,495,013	3,972,061	1,986,031
NRB International LLC	12,599,8973	7.50%	1,663,342	2,295,411	1,147,705
Technology IQ Limited	13,414,6984	7.99%	1,663,342	2,495,013	1,247,507
Hoperidge Enterprises Pty Ltd as trustee for the Jones Family Trust	16,694,7925	9.94%	Nil	Nil	Nil
Craig Ian Burton and Alba Capital Pty Ltd	11,135,7206	6.57%	Nil	Nil	Nil

Notes:

Comprises 38,750,411 Consideration Shares (as defined in Section 11.1) and 3,750,000 Shares proposed to be issued under the Offer as payment for Digital CC’s loan debt (as described in Note 2 to the table in Section 4.10.
Comprises 19,764,200 Consideration Shares and 750,000 Shares proposed to be issued under the Offer as payment for Digital CC’s loan debt (as described in Note 2 to the table in Section 4.10.

Comprises 11,421,522 Consideration Shares and 1,178,375 Shares proposed to be issued under the Offer as payment for Digital CC’s loan debt (as described in Note 2 to the table in Section 4.10.
Comprises 12,414,698 Consideration Shares and 1,000,000 Shares proposed to be issued under the Offer as payment for Digital CC’s loan debt (as described in Note 2 to the table in Section 4.10.
Pursuant to a resolution put to the General Meeting, the Company has received approval from Shareholders to issue 6,500,000 of the Shares under the Offer to Rodney Jones or his nominees Hoperidge Enterprises Pty Ltd. Mr Rodney Jones is a related party of the Company due to being the father of Mr Scott Jones, a Director of the Company and Hoperidge Enterprises Pty Ltd is a related party of the Company by reason of being associated with Mr Rodney Jones. Those Shares are included in the number of Shares at note 5 in the table immediately above.
Pursuant to a resolution put to the General Meeting, the Company has received approval from Shareholders to issue 1,500,000 of the Shares under the Offer to Craig Ian Burton or his nominee. Mr Craig Ian Burton is not a related party of the Company. Those Shares are included in the number of Shares at note 6 in the table immediately above.

The Company will announce to the ASX details of its top 20 Shareholders (following completion of the Offer) prior to the Shares being reinstated to trading on ASX.

4.13 Restricted Securities

Subject to the Company’s Shares being reinstated to Official Quotation, certain Shares, Performance Rights and Options in the Company will be classified by ASX as restricted securities and will be required to be held in escrow for up to 24 months from the date of reinstatement to Official Quotation. During the period in which these securities are prohibited from being transferred, trading in Shares may be less liquid which may impact on the ability of a Shareholder to dispose of his or her Shares in a timely manner.

The Securities likely to be subject to escrow will be the Shares, New Options and Performance Rights issued to the Vendors and any Shares issued to any other promoter of the Company (as defined in the ASX Listing Rules).

Our Company will announce to the ASX full details (quantity and duration) of the Shares, Performance Rights and New Options required to be held in escrow prior to the Shares commencing trading on ASX.

4.14 Financial Information

Following the change in the nature of its activities, the Company will be focused on developing the Digital CC business. Therefore, the Company’s past operational and financial historical performance will not be of significant relevance to future activities.

The Directors consider that it is not possible to accurately predict the future revenues or profitability of the Company or Digital CC’s business or whether any material revenues or profitability will eventuate. Prior to the date of this Prospectus, the Company has been operating its mining and trading business with results announced to ASX on 6 May 2014. As stated above, the Directors do not consider that these early results provide sufficient evidence to predict any future material revenues or profitability.

As a result, the Company is not in a position to disclose any key financial ratios or financial information other than its statement of financial position which is included in Section 8 of this Prospectus.

The initial funding for the Company’s future activities will be generated from the Offer of Shares pursuant to this Prospectus and existing cash reserves. The Company may need to raise further capital in the future to continue to develop the business of Digital CC as new opportunities arise, and such amounts may be raised by further equity raisings, or the Company may consider other forms of debt or quasi-debt funding if required.

4.15 Taxation

The acquisition and disposal of Shares will have tax consequences, which will differ depending on the individual financial affairs of each investor. All potential investors in the Company are urged to obtain independent financial advice about the consequences of acquiring Shares from a taxation viewpoint and generally.

To the maximum extent permitted by law, the Company, its officers and each of their respective advisors accept no liability and responsibility with respect to the taxation consequences of subscribing for Shares under this Prospectus.

4.16 Dividend Policy

We anticipate that significant expenditure will be incurred in the evaluation and development of our Company’s proposed activities in the digital currencies sector and related business ecosystems. These activities, together with the possible acquisition of interests in other projects, are expected to dominate the two year period following the date of this Prospectus. Accordingly, the Company does not expect to declare any dividends during that period.

Any future determination as to the payment of dividends by the Company (and the potential creation of a dividend policy for that purpose) will be at the discretion of the Directors and will depend on the availability of distributable earnings and operating results and financial condition of the Company, future capital requirements and general business and other factors considered relevant by the Directors. No assurance in relation to the payment of dividends or franking credits attaching to dividends can be given by the Company. The Company also makes no forecast as to whether it will make any future earnings.

4.17 Directors and Key Personnel

In accordance with the terms of the Agreement and with effect from the completion of the Acquisition, Mark Freeman and Scott Jones will retire as the Directors of the Company and four nominees of Digital CC, the Proposed Directors, will be casually appointed to the Board of the Company. Brett Lawrence will become a non-executive director of the Company.

Two of the existing Directors, Mark Freeman and Scott Jones will retire as Directors following the Acquisition. The new Board, comprising the Proposed Directors and Brett Lawrence, and their respective backgrounds and proposed roles in the Company effective upon completion of the Acquisition are as follows:

(a) Eugeni ‘Zhenya’ Tsvetnenko - Proposed Executive Chairman

Mr Tsvetnenko is the founding director and Lydian Enterprises Pty Ltd ATF Lydian Trust (one of the Vendors), which he controls, is the largest shareholder of Digital CC. He has over 8 years' experience in mobile premium messaging services including data, music, games, and news. He is a highly successful entrepreneur and is also the founder of Mpire

Media Pty Ltd, a privately held global multimedia and online advertising company servicing international clientele.

Mr Tsvetnenko was awarded the prestigious Ernst and Young, Entrepreneur of the Year 2010 young category and the Western Australian Business News 40 under 40 awards 2011. In 2009 Mr Tsvetnenko debuted on the BRW Young Rich list which estimated his wealth at $107 million. Mr Tsvetnenko is the sole director and company secretary and holder of the half of the shares in Lydian Enterprises Pty Ltd, one of the Vendors. His wife, Lydia Tsvetnenko, holds the other half of the shares in Lydian Enterprises Pty Ltd.

Mr Tsvetnenko is also the sole director of Magna Fortis Pty Ltd ACN 149 529 902, which has a right to receive approximately 17% of the shares in another of the Vendors, Technology IQ Limited. Mr Tsvetnenko is not and has not been a director of any other ASX listed company.

(b) Alex Karis - Proposed CEO/Managing Director

Mr Karis is President and founder of Karis Holdings Inc (doing business as Karis Marketing Group), one of the leading US digital marketing companies, providing online marketing support services to major US Telecom carriers. Karis Marketing Group also provides political consulting and polling services within the United States. Mr Karis started Karis Marketing Group late in 2012 and has over 12 years' experience in the retail marketing, online display and mobile content space, managing projects for a number of Fortune 500 companies.

Mr Karis holds a bachelor degree in Marketing from The University of Massachusetts Amherst. Mr Karis is the sole shareholder of Digital Man LLC, one of the Vendors. Mr Karis is not and has not been a director of any other ASX listed company.

(c) William Brindise – Proposed Executive Director and Chief Investment Officer

Mr Brindise has over 15 years' experience in trading energy, metal and grain options and futures. He started his career on the NYMEX working for ZAR trading and after a few years started his own trading/brokerage company, BAK. After 4 successful years he moved off the floor when NYMEX trading became digital and took a job working for the hedge fund SHK Management.

Mr Brindise managed $20 million and returned an annualised rate of 60% on those funds. Soon after he started his own proprietary trading desk and turned a $175,000 investment into $1.6 million in under a year. Mr Brindise will continue to oversee proprietary trading desk operations and is now focusing on trading Bitcoins at Digital CC.

He holds a bachelor degree in Business and Finance from Boston University. Mr Brindise is the sole shareholder of NRB International LLC, one of the Vendors. Mr Brindise is not and has not been a director of any other ASX listed company.

(d) Adeniyi Olalekan ‘Emmanuel’ Abiodun – Proposed Non-Executive Director

Emmanuel Abiodun graduated from Queen Mary University of London in 2005 with a degree in Electronic Engineering. He worked in the oil and gas industry as a software consultant before plying his trade in the Investment Banking world. Emmanuel held positions at JP Morgan & HSBC investment banks, where he advanced his knowledge of finance & financial systems.

He has been intimately involved with Bitcoin since 2010 and launched and controls Bitcoin mining company, Technology IQ Limited (which trades under the name ‘CloudHashing’ and is also one of the Vendors) in February 2013. Mr Abiodun controls Technology IQ Limited through his shareholding and board position in that entity and joins the Digital CC board, bringing his vast experience in Bitcoin and the Bitcoin mining space. Mr Abiodun is not and has not been a director of any other ASX listed company.

(e) Brett Lawrence – Current Managing Director and Proposed NonExecutive Director

Brett Lawrence joined the Company when he became Managing Director of the Company in April 2013. Mr Lawrence was instrumental in the substantial restructuring of the Company’s management team and capital profile in 2013, as the Company began seeking high quality and value adding investment opportunities. Prior to joining Macro, Mr Lawrence worked with Apache Energy for over eight years. He performed technical and management roles at Apache across the drilling engineering, reservoir engineering, project development and most recently commercial management sectors.

Mr Lawrence holds a Master of Petroleum Engineering, a Bachelor of Engineering (Mining) and Bachelor of Commerce (Finance) from Curtin University in Western Australia.

Mr Lawrence is not and has not been a director of any other ASX listed company.

Descriptions of other proposed key executives of the Company, to be appointed upon completion of the Acquisition are set out in Section 10.2.

4.18 Corporate Governance

To the extent applicable, in light of the Company’s size and nature, the Company has adopted The Corporate Governance Principles and Recommendations (2nd Edition) as published by the ASX Corporate Governance Council (Recommendations).

The Company’s main corporate governance policies and practices as at the date of this Prospectus are outlined in Section 10.3 of this Prospectus and the Company’s compliance and departures from the Recommendations will be announced to ASX prior to the Company’s re-instatement to trading on ASX’s Official List.

In addition, the Company’s full Corporate Governance Plan is available from the Company’s website (www.macroenergyltd.com.au).

4.19 Disclosure of Interests

For each of the existing Directors, the proposed remuneration to be provided from the date of this Prospectus up until they respectively resign from the Board upon the appointment of the Proposed Directors after completion of the Offer and Acquisition, together with the relevant interest of each of the existing Directors in the securities of the Company as at the date of this Prospectus, is set out in the table below.

Existing Directors

Director	Remuneration	Shares	Options1
Brett Lawrence	$15,000	1,666,666	9,000,000
Mark Freeman	$1,6672	48,782	Nil
Scott Jones	$1,6672	12,893,010	2,000,000

1 Each Option is unquoted and exercisable at $0.05 on a pre-Consolidation basis on or before 30 June 2017. Section 12.4 sets out the terms of the Options on a post-Consolidation basis.

2 Upon completion of the Offer and settlement of the Acquisition of Digital CC, it is intended that Mark Freeman and Scott Jones will resign. These amounts therefore represent one month’s remuneration, which is the anticipated time to completion as at the date of this Prospectus.

Proposed Directors

None of the Vendors have an existing interest in the Company’s Securities separate from their proposed participation in the Offer pursuant to the Agreement.

None of the Proposed Directors will receive remuneration for the financial years ending 30 June 2014 or 30 June 2015 in their capacities as directors of the Company. However, those Proposed Directors who will serve the Company in executive capacities after completion of the Acquisition (being all the Proposed Directors other than Emmanuel Abiodun and Brett Lawrence) will be remunerated in accordance with their respective executive employment agreements as summarised in Section 11.3.

The Proposed Directors’ remuneration pursuant to those agreements is summarised as follows:

Name	Position	Salary
Zhenya Tsvetnenko	Executive Chairman	USD$400,000
Alexander Karis	Chief Executive Officer	USD$375,000
William Brindise	Chief Investment Officer	USD$250,000

Other than to the extent of their respective executive services agreements summarised in Section 11.3, the Proposed Directors do not currently propose to receive remuneration for their services in the capacity of directors of the Company and there are no plans to introduce director fees for non-executive directors (though the Board reserves the right to do so in future).

For the purpose of incentivising and tying the rewarding of the Proposed Directors and management to the performance of the Company and Digital CC following completion of the Acquisition, the Board has determined to implement a bonus pool from which the Proposed Directors and management may receive additional remuneration.

The bonus pool will total twenty percent (20%) of the net profit after tax of the Company Group (bonus pool). Before the commencement of each financial year the Board will meet to determine the performance goals applicable for the impending financial year (FY performance goal).

If the Company Group:

(a) achieve 50% or greater of the FY performance goal, 100% of the bonus pool will be available for payment to the Proposed Directors and management in accordance with the then current bonus scheme of the Company Group and relevant employment contracts;
(b) achieves 40% to 49.9% of the FY performance goal, 80% of the bonus pool will be available for payment to the Proposed Directors and management in accordance with the then current bonus scheme of the Company Group and relevant employment contracts;
(c) achieves 30% to 39.9% of the FY performance goal, 60% of the bonus pool will be available for payment to the Proposed Directors and management in accordance with the then current bonus scheme of the Company Group and relevant employment contracts;
(d) achieves 20% to 29.9% of the FY performance goal, 40% of the bonus pool will be available for payment to the Proposed Directors and management in accordance with the then current bonus scheme of the Company Group and relevant employment contracts;
(e) achieves 10% to 19.9% of the FY performance goal, 20% of the bonus pool will be available for payment to the Directors and management in accordance with the then current bonus scheme of the Company Group and relevant employment contracts;
(f) achieves less than 10% of the FY performance goal, none of the bonus pool will be available for payment to the Proposed Directors and management.

Other than the termination payments summarised in Section 11.3 there are no retirement benefit schemes for Directors, although if they are paid they will receive statutory superannuation contributions. However, those Proposed Directors who are also proposed executives of the Company will receive remuneration in accordance with their respective services agreements as summarised elsewhere in Section 11.3.

None of the Company’s existing Directors have any interest in the proposed acquisition of the issued shares of Digital CC pursuant to the Agreement, other than as disclosed in this Prospectus.

4.20 Agreements with Directors, Proposed Directors or Related Parties

Our Company’s policy in respect of related party arrangements is:

(a) a Director with a material personal interest in a matter is required to give notice to the other Directors before such a matter is considered by the Board; and
(b) for the Board to consider such a matter, the Director who has a material personal interest is not present while the matter is being considered at the meeting and does not vote on the matter.

The Company’s Board has followed that process in approving the current agreements with related parties. Current Directors who did not have a material personal interest in each agreement considered that they are reasonable in the circumstances as the agreements were made on reasonable commercial terms and on terms that would be reasonable in the circumstances if the parties involved were dealing at arm’s length.

Section 11 outlines summaries of the agreements entered into with the Directors, Proposed Directors and related parties by the Company. For the purpose of this Section, the key agreements of that nature are as follows.

Agreements relating to the Acquisition

(a) Share Purchase Agreement between the Company and the Vendors (refer to Section 11.1);
(b) Executive Employment Agreement for Zhenya Tsvetnenko (refer to Section 1.1(a));
(c) Executive Employment Agreement for Alex Karis (refer to Section 1.1(b));
(d) Executive Employment Agreement for William Brindise (refer to Section 1.1(c));
(e) Loan Facility Agreement between the Company and Digital CC (refer to Section 11.5);
(f) CloudHashing Agreement between Digital CC and Technology IQ (refer to Section 11.6);
(g) Development Agreement between Digital CC IP Pty Ltd (a wholly owned subsidiary of Digital CC) and Mpire Media Pty Ltd (refer to Section 11.10);
(h) Shareholders’ and Directors’ Loan Agreement and Deed of Variation between Digital CC and the entities associated with certain Vendors and Proposed Directors (refer to Sections 11.14 and 11.15);
(i) Facility Agreement between Digital CC and one of the Vendors, Lydian Enterprises Pty Ltd ATF Lydian Trust (refer to Section 11.16);
(j) Trading Account Agreements between Digital CC Management Pty Ltd (a wholly owned subsidiary of Digital CC) and Alex Karis, NRB International LLC and William Brindise (refer to Section 11.17) and
(k) Domain Transfer Agreements with - Zhenya Tsvetnenko (refer to Section 11.19) and Alex Karis (refer to Section 11.20).

General agreements or agreements with existing Directors

Engagement agreements with Brett Lawrence (refer to Section 11.2).

5. DETAILS OF THE OFFER

5.1 The Offer

Pursuant to this Prospectus, the Company invites applications for up to 45,500,000 Shares at an issue price of $0.20 per Share to raise up to $9,100,000.

The Shares offered under this Prospectus will rank equally with the existing Shares on issue (subject to potential ASX imposed escrow which may apply).

Refer to Section 12.2 for a summary of the terms of Shares.

5.2 Minimum subscription

If the minimum subscription to the Offer, being the full subscription of $9,100,000, has not been raised within four months after the date of this Prospectus (or such period as varied by the ASIC), the Company will not issue any Shares or Vendor Consideration Securities and will repay all application monies for the Shares under the Offer within the time prescribed under the Corporations Act, without interest.

5.3 Applications

Applications for Shares under the Offer must be made using the Application Form.

Applications for Shares must be for a minimum of 10,000 Shares and thereafter in multiples of 2,000 Shares and payment for the Shares must be made in full at the issue price of $0.20 per Share.

Completed Application Forms and accompanying cheques, made payable to “Macro Energy Ltd” and crossed “Not Negotiable”, must be mailed or delivered to the address set out on the application forms by no later than the Closing Date.

The Company reserves the right to close the Offer early.

5.4 ASX listing

Application for Official Quotation by ASX of the Shares offered pursuant to this Prospectus will be made within 7 days after the date of this Prospectus.

If the Shares offered pursuant to the Offer are not admitted to Official Quotation by ASX before the expiration of 3 months after the date of issue of this Prospectus, or such period as varied by the ASIC, the Company will not issue any Shares and will repay all application monies for the Shares within the time prescribed under the Corporations Act, without interest.

The fact that ASX may grant Official Quotation to the Shares is not to be taken in any way as an indication of the merits of the Company or the Shares now offered for subscription.

5.5 Issue

Subject to the minimum subscription to the Offer being reached, the satisfaction or waiver of the conditions for completion of the Acquisition of Digital CC referred to in Section 11.1 and ASX granting conditional approval for the Company’s Shares to be reinstated to Official Quotation, issue of the Shares

offered by this Prospectus (and the Performance Rights comprising part of the Vendor Consideration Securities) will take place as soon as practicable after the Closing Date.

Pending the issue of the Shares or payment of refunds pursuant to this Prospectus, all application monies will be held by the Company in trust for the Applicants in a separate bank account as required by the Corporations Act. The Company, however, will be entitled to retain all interest that accrues on the bank account and each Applicant waives the right to claim interest.

The Directors will determine the recipients of the issued Shares under the Offer in their sole discretion. The Directors reserve the right to reject any application or to allocate any Applicant fewer Shares than the number applied for. Where the number of Shares issued is less than the number applied for, or where no issue is made, surplus application monies will be refunded without any interest to the Applicant as soon as practicable after the Closing Date.

5.6 Applicants outside Australia

This Prospectus does not, and is not intended to, constitute an offer in any place or jurisdiction, or to any person to whom, it would not be lawful to make such an offer or to issue this Prospectus. The distribution of this Prospectus in jurisdictions outside Australia may be restricted by law and persons who come into possession of this Prospectus should seek advice on and observe any of these restrictions. Any failure to comply with such restrictions may constitute a violation of applicable securities laws.

No action has been taken to register or qualify the Securities or otherwise permit a public offering of the Securities the subject of this Prospectus in any jurisdiction outside Australia. Applicants who are resident in countries other than Australia should consult their professional advisers as to whether any governmental or other consents are required or whether any other formalities need to be considered and followed.

If you are outside Australia it is your responsibility to obtain all necessary approvals for the issue of the Securities pursuant to this Prospectus. The return of a completed Application Form will be taken by the Company to constitute a representation and warranty by you that all relevant approvals have been obtained.

5.7 Oversubscriptions

No oversubscriptions will be accepted by the Company.

5.8 Not underwritten

The Offer is not underwritten.

5.9 Bookrunner to the Offer

DJ Carmichael Pty Limited ACN 003 058 857 (DJ Carmichael) is acting as sole bookrunner to the Offer pursuant to a mandate as summarised in Section 11.4 (Mandate).

5.10 Commissions payable

The Company reserves the right to pay a commission of 4% (exclusive of goods and services tax) of amounts subscribed through any licensed securities dealers

or Australian financial services licensee in respect of any valid applications lodged and accepted by the Company and bearing the stamp of the licensed securities dealer or Australian financial services licensee. Payments will be subject to the receipt of a proper tax invoice from the licensed securities dealer or Australian financial services licensee.

6. BACKGROUND ON DIGITAL CURRENCIES

6.1 Definition of digital currency and digital transactions

The term ’digital currency’ is used to refer to any means of payment that exists purely in electronic form, accounted for and transferred using computers, acting as an alternative currency and/or a way to transmit funds using peer to peer computing technology. Digital money is exchanged using technologies such as personal computers, smartphones, credit cards and the internet.

6.2 What are digital currencies?

Digital currencies are an electronically created and stored medium of exchange.

6.3 What are Bitcoins?

Bitcoin is a type of digital currency known as a ‘cryptocurrency’ because it uses cryptography as a method of controlling the creation and transfer of the currency and seeking to provide transaction security.

Bitcoins were created in 2009 by Satoshi Nakamoto (pseudonym). The goal of using Bitcoins is to create a peer-to-peer payment system that does not require a trusted third party to solve the problem or preventing double-spending of currencies. By removing the intermediary, transaction costs may be minimised.

6.4 How does cryptography control the creation and transfer of Bitcoins?

The creation and transfer of Bitcoins occurs via the Bitcoin network, which is an online, end-user-to-end-user network hosting the public transaction ledger, known as the ‘Blockchain’ (Blockchain).

The Blockchain is a public record of Bitcoin transactions in chronological order. The Blockchain is shared between all Bitcoin users and is used to verify the permanence of Bitcoin transactions and to prevent double spending.

Bitcoin transactions are recorded on the Blockchain, on which Bitcoin ‘miners’ or ‘mining pools’ solve algorithmic equations allowing them to add records of recent transactions called “blocks” (Blocks) to the chain of transactions in exchange for an award of Bitcoins from the Bitcoin network and the payment of transaction fees, if any, from users whose transactions are recorded in the block being added. Therefore, the Blockchain acts as a historical record of the transactions relating to a Bitcoin.

6.5 What is Bitcoin ‘mining’?

Bitcoin ‘mining’ is the term used to describe the process of earning new Bitcoins which can be converted to fiat currencies. The process involves using powerful computer technology to provide a service to the Bitcoin network of verifying Bitcoin transactions, thereby creating new Bitcoin.

6.6 What is ‘hashing power’?

Members of the Bitcoin network use the term “hashing power” to describe computer power. The ‘hash rate’ is the measuring unit of the computer processing power of the Bitcoin network. Before a Block can be added to the Blockchain, the Bitcoin network must solve a complex mathematical puzzle through a process of trial and error; the hash rate represents the speed at which

the Bitcoin network attempts to solve the equation. Each Block has its own unique equation.

6.7 Background on Bitcoins and similar cryptocurrencies

Digital currency is an electronically created and stored medium of exchange.

Bitcoin is an open source digital cryptocurrency (using cryptography to control the creation and transfer of currency) that can be exchanged for goods and services with businesses that accept them as payment. The first cryptocurrency to begin trading was Bitcoin although there are numerous other cryptocurrencies now available, such as Ripple, Litecoin, Auroracoin, Peercoin and Dogecoin. Unlike early digital currencies which were pegged to gold or silver prices, cryptocurrencies derive their value from speculative trading and the laws of demand and supply. While there are numerous other digital currencies, the most traded is Bitcoin.

The infrastructure required for Bitcoin is widely accessible and well established, in the form of the internet. Each Bitcoin comprises of 100 million smaller denominations called Satoshi, allowing users to buy or sell Bitcoins worth only fractions of a cent, to enable the currency to remain practical for retail consumers and small businesses.

Bitcoin transactions are virtually frictionless and incur no transaction costs. In addition, Bitcoin transactions can be completed almost instantaneously irrespective of size or the recipient’s destination.

The Bitcoin network is an online, end-user-to-end-user network hosting the public transaction ledger, known as the Blockchain. Bitcoin transactions are recorded on the Blockchain, on which miners or mining pools solve algorithmic equations allowing them to add records of recent transactions (called “blocks”) to the chain of transactions in exchange for an award of Bitcoins from the Bitcoin network and the payment of transaction fees, if any, from users whose transactions are recorded in the block being added. A block is a record in the Blockchain that contains and confirms many waiting transactions. The algorithms that underlie Bitcoin are such that a new Block is created, solved and added to the Blockchain approximately every 10 minutes.

Along with Bitcoin, other digital currencies have also been developed, and are developing, however Bitcoin remains the most high profile and valuable (in terms of price) of the digital currencies developed to date, maintaining a significant advantage over the other currencies.

6.8 Historical market prices of digital currencies

The table below sets out the historical prices of a number of digital currencies (in US$):

Currency	L ow Price	High Price	Last Price
			asa t 1 May 2014
Bitcoin	$ 0.05	$1,124.76	$459 .410
	a t 17 July 2010	at 29 November
		2013
Litecoin	$ 1.56	$48.48	$11 .247
	a t 22 October	at 28 November
	2 013	2013
Ripple	$ 0.0055	$0.02833	$0.0 1
	a t 10 April 2014	at 6 January 2014
Peercoin	$ 1.28	$8.49	$2.2 04
	a t 11 April 2014	at 30 November
		2013

Based on the tradin g price of each digital currency since its creation available at www.cryptocoincharts.info.

As the table abov e shows, since the initial creation of digit a l currencies, there has been significa n t price movement and volatility, drive n most likely by a mixture of negative publicity, driven by events such as:

(a) the closure o f the Mt Gox trading exchange in February 2014;
(b) government intervention, including statements m a de in relation to taxation; a n d
(c) negative m edia reports and publicity relating to t h e use of Bitcoin, including relating to the infamous Silk Road website.

The chart below illu s trates the price movement of Bitcoin duri n g the previous 12 months (in US$):

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Source: Bitcoincharts.c o m

Despite this, there is sufficient evidence from the actions of government and other major financial organisations to indicate that Bitcoin is slowly achieving legitimacy as a bona fide currency and payment alternative, with the development of and roll out of Bitcoin automatic teller machines in North America, and now in Australia.

6.9 Bitcoin mining

There are currently approximately 12.5 million Bitcoins in circulation and the process by which Bitcoin are created and supply is increased is called ‘mining’. Bitcoin mining is the method by which the Bitcoin system ensures its own operational functionality and efficiency, which requires transactions to be verified, approved and recorded in a database. This is a sequential record of all transactions, being the Blockchain, which records existing Bitcoin ownership as well as historical ownership.

Contained in each Block is a record of some or all recent transactions and a reference to the previous Block. It also contains an answer to a mathematical puzzle (being an equation) which is unique to each Block. New Blocks cannot be submitted to the Blockchain until the equation is solved. Without mining, transactions could not be verified and there would be no way to confirm that double-spending has not occurred.

The people that use computing power to attempt to solve the equation are called ‘miners’. In theory any individual can become a miner by downloading and installing the mining software onto a personal computer. This will add their computer to the Bitcoin network and the computer power available to the Bitcoin network will increase. Members of the Bitcoin network use the term “hashing power” to describe computer power.

The actual Bitcoin mining process involves solving complex mathematical equations and the participant that successfully solves the equation first is rewarded with Bitcoins. As more computing power enters the Bitcoin network, the algorithm complexity increases and more computing power is required by miners to maintain their competitive position. The number of Bitcoins awarded for successfully verifying transactions halves every four years.

Difficulty of solving the equation for a Block is automatically adjusted by the network such that the number of Blocks solved per hour is, on average, six. Every 2016 Blocks, the network compares the actual number of Blocks created per hour with this average and modifies the target by the percentage that it varied. This modification results in either an increase or decrease in the difficulty of solving the equation to produce new Bitcoins. Since new difficulty is adjusted so that the number of Blocks solved per hour is six, the rate of generation of new Bitcoins is known. Therefore it is known that the final Bitcoins will only be generated in 2140; however 99% of the Bitcoins will have been generated by 2032. Currently approximately12.7 million Bitcoins have been mined up to May 2014.

The increase in difficulty of solving the equation over the period since Bitcoin was first created has rendered personal computers redundant for Bitcoin mining. Therefore, while any individual can download mining software and add their personal computer’s hashing power to the Bitcoin network, it will be difficult for them to be the first to solve the equation.

As the reward of new Bitcoins is only given to the user who solves the mathematical equation first, it is in a miner’s best interests to increase their

hashing power and thereby increase their chances of being the first to solve the equation.

New Bitcoins can be used as payment for goods and services, or exchanged into cash. Bitcoins can be stored securely using an online Bitcoin wallet that can facilitate payments or convert Bitcoins into cash through multiple exchanges.

A reliable way to store Bitcoins is in cold storage. Cold storage is a concept which refers to assigning Bitcoins to a Bitcoin address that is not connected to the internet and therefore not exposed to online risks. The Bitcoin address can be written down on a piece of paper and stored securely. Bitcoin addresses (also called ‘Bitcoin wallet addresses’) are usually encrypted with a password for further protection.

When a transaction is executed using Bitcoins, the Bitcoin network is automatically alerted and the transaction is added to a new unsolved Block. For a new Block to be added to the Blockchain, miners must use the Bitcoin network’s hashing power to solve the equation through a process of trial and error.

Since mining requires computers, miners need to be compensated for the costs they incur in purchasing hashing power (e.g. purchasing new computers) and for the energy costs they incur in the course of mining (e.g. electricity costs). Therefore, the miner that solves the equation first is awarded new Bitcoins. The reward for solving each Block starts at 50 and halves every 210,000 Blocks. As at the date of this Prospectus, the reward is 25 Bitcoins per Block.

Mining therefore serves two purposes:

It confirms all transactions and prevents any users from double-spending their Bitcoins; and
It is the means by which the 21 million Bitcoins are distributed into the Bitcoin network.

6.10 Mining Pools

Another method that Bitcoin miners use to increase their chances of solving the complex mathematical equation which is unique to each Block, and receiving the reward of Bitcoins, is pooling their hashing power with other miners. This is referred to as a mining pool. If the mining pool solves the equation first, each miner within the mining pool will receive a portion of the Bitcoin reward in accordance with the proportion of hashing power that they contributed to the mining pool. mining pools are favoured because they allow individuals who, alone, may find it difficult to accumulate the hashing power to receive the Bitcoin reward, but together may have enough power to receive that reward.

6.11 Other digital currencies

there are in excess of 80 different cryptocurrencies currently in existence, although the market share is currently dominated by Bitcoin.

6.12 Risk factors

In addition to the above, Section 9 of this Prospectus (Risk Factors) contains detailed information relating to various risks associated with digital currencies and operating in the digital currency sector. These risks include detailed

information regarding the operation of the sector and how some of these risks may be managed by the Company.

7. BACKGROUND ON DIGITAL CC AND ITS PROPOSED BUSINESS

7.1 Background

Digital CC was incorporated in January 2014, to focus on opportunities created by, and within digital currencies such as Bitcoin and the other digital currencies currently existing. The digital currency sector is rapidly expanding and Digital CC aims to be at the forefront of this new technology and its associated business ecosystems. Digital CC operates as a vertically integrated digital currency company, providing investors exposure to a wide range of opportunities in the sector.

Digital CC’s current business in the digital currency sector is currently primarily focussed on Bitcoin, given it comprises a significant proportion of the current digital currency market.

Digital CC is actively involved in earning new coins through investments in dedicated ‘mining’ pools and hardware. The ‘mining’ process enables Digital CC to participate in seeking to earn new coins through the dedication of computing processing power to the Bitcoin verification system. Digital CC currently mines Bitcoins and proposes to launch Litecoin mining and other alternative cryptocurrencies (known as ‘altcoins’) operations (alternative cryptocurrencies to Bitcoin) during 2014.

Digital CC proposes to use its listing on the ASX to gain access to capital for the purpose of:

growing its mining and hashing capabilities;
trading in digital currencies;
developing new products that relate to digital currency trading and use; and
considering the acquisition of other existing digital currency businesses that may complement or assist Digital CC to grow its size and scale.

Since the announcement of the transaction between the Company and Digital CC on 13 March 2014, Digital CC has:

(a) signed a strategic agreement with CloudHashing.com, one of the world’s largest Bitcoin mining providers (and a company associated with Proposed Director Emmanuel Abiodun), for CloudHashing.com to manage Digital CC’s Bitcoin mining hardware – as announced to ASX by the Company on 18 March 2014;
(b) signed a strategic supply agreement with Bitfury, one of the leading hardware manufacturers for Bitcoin mining hardware, which has enabled Digital CC to expand Bitcoin mining operations over the previous month – as announced to ASX by the Company on 3 April 2014. Digital CC received, and has been using the first instalment of this hardware since April 2014, with the second instalment due to be received in May 2014; and
(c) successfully undertaken its mining activities utilising the hardware referred to in (b) above mining in excess of 1,700 new Bitcoin and trading those Bitcoin in accordance with its trading strategies outlined in this Prospectus generating a return of approximately 31% from funds

invested up to 30 April 2014 – as announced to ASX by the Company on 6 May 2014.

Copies of these announcements are available from the Company’s website (www.macroenergyltd.com.au).

7.2 Corporate Vision

Digital CC has been successful in establishing several initial revenue streams which provide it with flexibility to tailor its corporate strategy in line with the evolution of the industry. Digital CC currently has two separate business operations being:

(a) digital currency mining; and
(b) digital currency trading.

Whilst focussing on these two main businesses, Digital CC is also involved in the early stage development of various digital currency based consumer products. The development and roll out of any such products remains subject to ongoing testing and development and to the products in development remaining relevant in a rapidly developing digital currency market.

Digital CC's management is highly experienced in commodities trading and in developing products and services for mobile devices. Acknowledging that the digital currency market remains in relative infancy and is therefore dynamic, Digital CC continuously monitors the industry for new growth opportunities - as the ecosystems surrounding digital currencies mature potential new demand may be created for products and services both upstream and downstream. Digital CC aims to put itself in a position where it is capable of reacting to any such new demand as a market leader in this sector.

7.3 Corporate Structure

Following completion of the Acquisition, the corporate structure of the Company will be as set out on the following page:

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----- Start of picture text -----

Digital CC Limited
(ACN 009 575 035)
ASX Listed
Digital CC Holdings
Pty Ltd
(ACN 167 754 725)
Digital CC Trading Digital CC IP Pty Ltd Digital CC Digital CC USA Digital CC IP Limited Digital CC Limited
Pty Ltd (ACN 167 755 080) Management Pty Ltd Holdings Inc (HK) (HK)
(ACN 167 755 099) (ACN 168 145 300) (Cert. No 626 550 8- (Cert. No 624 529 90-
000-01-14-6) 000-12-13-4)
Digital CC USA Digital CC USA LLC
Services LLC
----- End of picture text -----

7.4 Key Assets

Digital CC currently holds the following key assets and intellectual property within its corporate structure outlined above:

Digital CC Trading Pty Ltd

(a) Lease of Hardware and Hashing Capacity from Digital CC Management Pty Ltd;
(b) Licence of IP from Digital CC IP Pty Ltd; and
(c) Right to Trading Accounts (refer to Trading Accounts Transfer Agreement summarised below).

Digital CC IP Pty Ltd

(a) rights to Domain Names used by Digital CC;
(b) trading platform (currently in the beta phase); and
(c) trademarks (pending).

Digital CC Management Pty Ltd

(a) Hashing Capacity;
(b) Bitcoins & Litecoins;
(c) Cash;

(d) Hardware; and
(e) Licence of IP from Digital CC IP Pty Ltd.

Digital CC IP Ltd (Hong Kong)

Licence of IP from Digital CC IP Pty Ltd.

Digital CC USA Holdings Inc

Proposed employee arrangements for US based employees.

7.5 Proposed Business Strategies of the Company

As outlined in Section 7.1 above, following the listing of the Company on ASX, the Company intends to focus its business development on the following core areas:

Bitcoin Mining

As described in Section 6.9, Bitcoin mining is the process of using computer hardware, to complete mathematical calculations in an attempt to solve complex mathematical puzzles, thereby confirming transactions in the Blockchain and increasing the security of the entire Bitcoin network.

Digital CC has investments in dedicated pooled mining platforms and hardware that use specialised equipment optimised for Bitcoin mining. Pooled mining is a term used to describe participating in mining as part of a larger amount of mining equipment (mining pool). The intention of pooled mining is to enable Bitcoins to be generated quicker, however allocated in smaller amounts because each Bitcoin reward has to be shared amongst the participants in the pool.

In order to remain competitive, Digital CC intends to invest in new technology that will increase its hash rate (which is the measuring unit of the processing power of the Bitcoin network) and thereby improve its chances of mining Bitcoins. As summarised in Section 4.9 part of the funds proposed to be raised from the Offer are proposed to be used to increase Digital CC’s hashing power and therefore improve its chances of earning Bitcoins. To this end, Digital CC may trade or upgrade its hardware at regular intervals to maintain an adequate level of hardware to compete in the mining market.

Digital CC proposes to conduct its mining activities using its own hashing power and, may consider buying into mining pools. Each scenario is discussed below.

Mining in its own right

Digital CC’s model for Bitcoin mining can be broken down into three key steps:

(a) acquire hashing power for rates that are below market rates through strategic hardware and contracting agreements;
(b) utilise hashing power and participate in mining; and
(c) on-sell the computer power at market rates.

Using this business model, Digital CC aims to generate revenue from the mining itself, as well as from the sale of its computer power (although no forecast is made as to whether any such revenue will be generated).

Digital CC has developed close relationships with its key supplier (BitFury (Malta) Limited, refer to Section 11.8) from which it buys the necessary mining hardware. Through this relationship, Digital CC is able to purchase hardware at a significant discount to the market price. Digital CC also buys hardware in bulk which enables it to further negotiate on price.

Digital CC’s data centres (the locations in which its hardware is stored and operated) are currently located in Iceland. Iceland was chosen because the computer hardware requires significant quantities of electricity to operate and Digital CC is able to access cheap electricity in Iceland. Digital CC has no proprietary interest in the data centres themselves. Technology IQ Limited has agreed hosting facility arrangements with the owners of the data centres and Digital CC may enter into hosting facility arrangements with the owners in its own right.

Digital CC constantly monitors its hashing power having regard to expected increases in the amount of hashing power required to mine Bitcoins and the current Bitcoin price. In the event that Digital CC considers it would be in its best interests to scale back its hashing power, Digital may sell some of its hashing power to the market. Typically, these sales are conducted at market rates which may be higher than the original cost to Digital.

Utilising Mining Pools

To the extent that manufacturers are unable to provide Digital CC with sufficient hardware, or to the extent that Digital CC has excess cash that it wishes to invest on short notice, Digital CC may hire hashing power from one or more mining pools (which may include CloudHashing’s mining pool). However, the Proposed Directors would only use that option as an alternative, as it is more cost effective for Digital CC to purchase its own hardware rather than buying in to a mining pool.

Digital Currencies Trading and Investment

Digital CC trades or proposes to trade digital currencies by using specialised strategies which include arbitrage, buying long positions, selling short positions, futures contracts and market making at exchanges (Bitcoin exchanges are described below).

Digital CC has digital currency inventories, as of the date of this Prospectus, of 1,345.28 Bitcoins. The Company has no inventories of any other digital currencies.

Digital CC earns revenue through the trading of, and investment in, digital currencies; primarily Bitcoins. Digital CC’s trading strategy can be broken into three components:

(a) leveraging arbitrage opportunities;
(b) trading Bitcoin futures contracts; and
(c) market making.

Digital CC’s trading operations are managed by its Chief Investment Officer, William Brindise, who is also a Proposed Director (refer to Section 10.1).

Leveraging arbitrage opportunities

Arbitrage is the simultaneous purchase and sale of an asset in order to profit

from a difference in the price of the assets in different markets. Most commonly arbitrage exists due to market inefficiencies which result in the same asset trading at a different price on separate exchanges. In order to exploit this price difference, a trader would buy the asset on the exchange with the lower price and then immediately sell it on the exchange with the higher price. The trader will repeat this process until the laws of demand and supply correct the anomaly and both markets list the asset at the same price.

Digital CC’s strategy involves taking advantage of the price differences between the exchanges that trade Bitcoins. By monitoring the prices offered on each of these exchanges, Digital CC aims to capitalise on the price differences that exist, but no forecast is made of whether it will receive any revenue through such arbitrage.

The primary reason for the presence of these pricing anomalies is illiquidity. Although Bitcoins have been in circulation since 2009, the market is still very immature and the number of transactions that take place using Bitcoin relative to those transactions with fiat currency is low. Therefore, inefficiencies in the market take time to correct.

Trading futures contracts

Futures contracts are contracts between two parties whereby one party agrees to buy an asset and one party agrees to sell an asset at an agreed upon price at a future date. Several exchanges facilitate the trading of Bitcoin futures contracts. Bitcoin futures contracts operate in the same manner as other futures contracts with the only difference being that the asset that is the subject of the contract is Bitcoin.

Digital CC aims to make predictions about whether the price of Bitcoins will rise or fall (although no forecast is made as to whether such predictions will be accurate). If Digital CC expects the price to rise, this investment strategy would involve buying Bitcoin futures; if Digital CC expects the price to fall the strategy would involve selling Bitcoin futures.

Market making

A market maker is an agency that holds a certain number of assets in order to facilitate trading of those assets. Market makers compete for order flow by displaying buy and sell prices for a guaranteed quantity of the assets. When a buy order is received, the market maker either uses its own cash to purchase the asset or finds an offsetting order; and vice versa, when a sell order is received, the market maker either sells assets from its own inventory or finds an offsetting order. The market maker generates profits from the spread between the price they are willing to buy the assets (bid) and the price they sell the assets (ask).

Digital CC is engaged with two of the six major global Bitcoin exchanges (being Bitfinix and Icbit) to act as a market maker. As a market maker, Digital CC helps to improve liquidity in the market by completing buy/sell orders at prices which other market participants are unwilling to transact at. Digital CC aims to generate revenue as a market maker from the difference between the price it buys and sells Bitcoins (although no forecast or representation is made in this Prospectus as to whether any revenue will thereby be derived by Digital CC or the Company). Digital CC will provide such market making services only upon completion of its internal trading platform.

Development of new products

In addition to its mining and trading activities outlined above, Digital CC aims, subject to the risk of development programs being delayed or ultimately unsuccessful, to develop various consumer based products relating to and utilising digital currencies.

Following completion of the Acquisition, and subject to ongoing development and testing prior to release, the Company hopes to be able to release some of its initial suite of products in the fourth quarter of 2014.

By way of example only, some of those products, as they exist as at the date of this Prospectus are briefly summarised below. The Company and Digital CC note that these products remain in the conceptual stage only and that no investment in the Company should currently be based on these products being developed into consumer products. Other products or concepts that Digital may be working on or may develop remain at a stage where Digital considers them to be confidential and trade secrets.

(a) digital Wallet

The digital wallet is a proposed consumer product that facilitates both digital and real world purchases using digital currency (such as Bitcoin, Litecoin, etc.) through both a mobile and web application.

(b) digital API

The digital API (application programming interface) is proposed to enable third party developers to integrate Digital’s payment services into their own applications. If achieved, this will allow any website to accept digital currency payments and issue refunds.

As at the date of this Prospectus, Digital CC has not created, and does not hold, any intellectual property that could reasonably be considered to be an asset of Digital CC. The Digital wallet, the trading platform and other products that Digital CC has outlined above, are not yet at a stage where Digital CC could register them or assert any registrable intellectual property rights over them. Notwithstanding this, Digital CC is committed to the development of digital currency products, as outlined above, and has a plan for the proper ongoing development of its existing product concepts utilising the funds raised from the Offer as set out in Section 4.10.

Acquisition of complementary businesses

In addition to internal developments, Digital CC remains open to the consideration of existing businesses that may be complementary to or may enhance the existing assets and business of Digital CC.

To this end, Digital CC continues to consider businesses which may fit within these parameters, and may undertake new acquisitions as and when opportunities arise.

Other digital currencies

Digital CC considers that digital currencies are the future of conducting transaction and purchases digitally and has adopted the "first mover" strategy with digital currencies. As new and/or alternative digital currencies become available Digital may adapt to integrate these new technologies.

Although Digital CC has interests in other digital currencies and in the long term

other digital currencies may take precedence; its primary focus is Bitcoin.

8. FINANCIAL INFORMATION

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Deloitte Corporate Finance Pty Limited ACN 003 833 127 AFSL 241457

The Directors Macro Energy Limited Level 7 1008 Hay Street Perth WA 6000

Woodside Plaza Level 14 240 St Georges Terrace Perth WA 6000 GPO Box A46 Perth WA 6837 Australia

Tel: +61 8 9365 7000 Fax: +61 (8) 9365 7001 www.deloitte.com.au

8 May 2014

Dear Sirs

INVESTIGATING ACCOUNTANT’S REPORT ON HISTORICAL AND PRO FORMA HISTORICAL FINANCIAL INFORMATION AND FINANCIAL SERVICES GUIDE

Introduction

This report has been prepared at the request of the Directors of Macro Energy Limited (the Company or MEJ) for inclusion in a Prospectus to be issued by the Company in respect of the offer of 45,500,000 Shares (on a post-Consolidation basis) at an issue price of $0.20 per Share (the Offer) and the offer of 82,764,655 Shares and 8,316,710 New Options (on a post-Consolidation basis) to the Vendors (Vendor Offer), together the Offers.

Deloitte Corporate Finance Pty Limited is wholly owned by Deloitte Touche Tohmatsu and holds the appropriate Australian Financial Services licence under the Corporations Act 2001for the issue of this report.

References to the Company and other terminology used in this report have the same meaning as defined in the Glossary of the Prospectus.

Scope

Pro forma Historical Financial Information

Deloitte Corporate Finance Pty Limited has been engaged by the Directors of the Company to review:

the pro forma Consolidated Statement of Financial Position of the Company as at 31 December 2013, prepared on the basis that the pro forma adjustments detailed in Section 8 of the Prospectus had occurred on that date;
the pro forma adjustments set out in Section 8 of the Prospectus (pro forma adjustments);
accompanying notes.

(the Pro forma Historical Financial Information).

The Pro forma Historical Financial Information has been derived from the Statement of Financial Position of the Company as at 31 December 2013 (Historical Financial Information), after adjusting for the effects of the pro forma adjustments described in Section 8 of the Prospectus.

Liability limited by a scheme approved under Professional Standards Legislation. Member of Deloitte Touche Tohmatsu Limited

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The Historical Financial Information has been extracted from the financial report of Company for the year(s) ended 31 December 2013, which was audited by Deloitte Touche Tohmatsu in accordance with the Australian Auditing Standards. Deloitte Touche Tohmatsu issued an unmodified audit opinion on the financial report. The Pro forma Historical Financial Information is presented in the Prospectus in an abbreviated form, insofar as it does not include all of the presentation and disclosures required by Australian Accounting Standards and other mandatory professional reporting requirements applicable to general purpose financial reports prepared in accordance with the Corporations Act 2001.

The stated basis of preparation is the recognition and measurement principles contained in Australian Accounting Standards applied to the Historical Financial Information and the event(s) or transaction(s) to which the pro forma adjustments relate, as described in Section 8 of the Prospectus, as if those event(s) or transaction(s) had occurred as at the date of the Historical Financial Information. Due to its nature, the Pro forma Historical Financial Information does not represent the company’s actual or prospective financial position.

Directors’ Responsibility

The Directors are responsible for:

the preparation and presentation of the Historical Financial Information and the Pro forma Historical Financial Information, including the selection and determination of pro forma adjustments made to the Historical Financial Information and included in the Pro forma Historical Financial Information; and
the information contained within the Prospectus.

This responsibility includes for the operation of such internal controls as the Directors determine are necessary to enable the preparation of the Historical Financial Information and the Pro forma Historical Financial Information that is free from material misstatement, whether due to fraud or error.

Our Responsibility

Our responsibility is to express a limited assurance conclusion on the Pro forma Historical Information based on the procedures performed and the evidence we have obtained. We have conducted our engagement in accordance with Australian Standard on Assurance Engagement (ASAE) 3450 Assurance Engagements involving Corporate Fundraisings and/or Prospective Financial Information.

A review consists of making enquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review is substantially less in scope than an audit conducted in accordance with Australian Auditing Standards and consequently does not enable us to obtain reasonable assurance that we would become aware of all significant matters that might be identified in a reasonable assurance engagement. Accordingly we will not express an audit opinion.

We have performed the following procedures as we, in our professional judgement, considered reasonable in the circumstances:

Conclusions

Pro forma Historical Financial Information

Based on our review, which is not an audit, nothing has come to our attention that causes us to believe that the Pro forma Historical Financial Information is not presented fairly, in all material respects, in accordance with the stated basis of preparation as described in Section 8 of the Prospectus.

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Restrictions on Use

Without modifying our conclusions, we draw attention to Section 8 of the Prospectus, which describes the purpose of the Financial Information, being for inclusion in the Prospectus. As a result, the Investigating Accountant’s Report may not be suitable for use for another purpose.

Consent

Deloitte Corporate Finance Pty Limited has consented to the inclusion of this limited assurance report in the Prospectus in the form and context in which it is included.

Disclosure of Interest

Deloitte Corporate Finance Pty Limited does not have any interest in the outcome of these Offers other than the preparation of this report and participation in the due diligence procedures for which normal professional fees will be received.

Deloitte Touche Tohmatsu is the auditor of the Company.

Yours faithfully

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Johan Duivenvoorde Director

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LIMITED

A.B.N. 59 009 575 035

P R O F O R M A F I N A N C I A L I N F O R M A T I O N A S A T 3 1 D E C E M B E R 2 0 1 3

SECTION 8 FINANCIAL INFORMATION

This section contains consolidated historical financial information and consolidated pro forma financial information for Macro Energy Limited as at 31 December 2013. The historical financial information has been prepared in accordance with the recognition and measurement requirements of Australian Accounting Standards and the accounting policies adopted by Macro Energy Limited as detailed in Note 1. The consolidated pro forma financial information has been derived from the historical financial information and assumes the completion of the pro forma adjustments as set out in Note 2 as if those adjustments had occurred as at 31 December 2013.

The consolidated financial information contained in this section of the Prospectus is presented in an abbreviated form and does not contain all the disclosures that are provided in a financial report prepared in accordance with the Corporations Act 2001 and Australian Accounting Standards and Interpretations.

The consolidated historical financial information comprises:

The unaudited consolidated statement of financial position as at 31 December 2013; and
· The notes to the historical financial information.

The consolidated pro forma financial information comprises:

The unaudited consolidated pro forma statement of financial position as at 31 December 2013, prepared on the basis that the pro forma adjustments detailed in Note 2 had occurred as at 31 December 2013; and
The notes to the consolidated pro forma financial information.

Collectively referred to as the Financial Information.

SECTION 8 FINANCIAL INFORMATION

SCHEDULE 1 – CONSOLIDATED HISTORICAL & PRO FORMA STATEMENT OF FINANCIAL POSITION

Note Current Assets Cash and cash equivalents Trade and other receivables 3 Total current assets Non-Current Assets Property, plant and equipment Prepayments 4 Total non-current assets Total Assets Current Liabilities Trade and other payables Borrowings Provisions 5 Total current liabilities Total Liabilities Net Assets Equity Issued capital 6 Accumulated losses 7 Other reserves 8 Total Equity	Historical Macro Energy Limited as at 31 December 2013 Pro forma Consolidated as at 31 December 2013 $ $
	3,319,105 234,786 8,184,314 234,786
	3,553,891 8,419,100
	2,912 100,088 3,365,612 496,195
	103,000 3,861,807
	3,656,891 12,280,907 97,932 - 117,165 101,308 - 117,165
	215,097 218,473
	215,097 218,473
	3,441,794 12,062,434
	29,011,690 10,315,362 (27,108,953) (1,073,197) 1,539,057 2,820,269
	3,441,794 12,062,434

This statement should be read in conjunction with the accompanying notes. This pro-forma does not include revenue derived and expenses incurred from the date of incorporation of Digital CC. Further information on the trading activities of Digital CC up to the end of April 2014 was released to the ASX on 6 May 2014.

SECTION 8 FINANCIAL INFORMATION

1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

The significant accounting policies that have been adopted in the preparation of the financial information are:

Basis of Preparation

The historical consolidated financial information has been prepared in accordance with the recognition and measurement, but not all the disclosure, requirements specified by all Australian Accounting Standards and Interpretations and the Corporations Act 2001.

The financial information has also been prepared on a historical cost basis, except for certain financial instruments that are measured at fair value, as explained in the accounting policies below.

The financial information is presented in Australian dollars, unless otherwise noted.

Accounting Estimates and Judgements

In the application of the accounting policies the directors are required to make judgments, estimates and assumptions about carrying values of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and various other factors that are believed to be reasonable under the circumstances, the results of which form the basis of making the judgments. Actual results may differ from these estimates.

The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised if the revision affects only that period or in the period of the revision and future periods if the revision affects both current and future periods.

Judgments made by the directors in the application of the accounting policies that have a significant effect on the financial information are disclosed, where applicable, in the relevant notes to the financial information.

Principles of Consolidation

The consolidated historical financial information incorporates the assets and liabilities of all subsidiaries of Macro Energy Limited (“Macro Energy”, “Company” or “Parent Entity”) as at 31 December 2013 and the results of all subsidiaries for the period then ended. Macro Energy and its subsidiaries together are referred to as the Group or the Consolidated Entity.

Subsidiaries are all those entities (including special purpose entities) over which the Group has the power to govern the financial and operating policies, generally accompanying a shareholding of more than one-half of the voting rights. The existence and potential effect of potential voting rights that are currently exercisable or convertible are considered when assessing whether the Group controls another entity.

Subsidiaries are fully consolidated from the date on which control is transferred to the Group. They are de-consolidated from the date that control ceases. The purchase method of accounting is used to account for the acquisition of subsidiaries/assets by the Group.

Intercompany transactions and balances, and unrealised gains on transactions between Group companies, are eliminated. Unrealised losses are also eliminated unless the transaction provides evidence of the impairment of the asset transferred. Accounting policies of subsidiaries have been changed where necessary to ensure consistency with the policies adopted by the Group.

SECTION 8 FINANCIAL INFORMATION

1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONT.)

Revenue Recognition

Revenue is measured at the fair value of the consideration received or receivable. The following specific recognition criteria must also be met before revenue is recognised:

Interest

Interest income is recognised on a time proportionate basis that takes into account the effective yield on the financial asset.

Income Tax

The income tax expense or income for the period is the tax payable or recoverable on the current period’s taxable income or tax loss based on the national income tax rate for each jurisdiction adjusted by changes in deferred tax assets and liabilities attributable to temporary differences between the tax bases of assets and liabilities and their carrying amounts in the financial information, and to unused tax losses.

Deferred tax assets and liabilities are recognised for temporary differences at the tax rates expected to apply when the assets are recovered or liabilities are settled, based on those tax rates which are enacted or substantively enacted for each jurisdiction. The relevant tax rates are applied to the cumulative amounts of deductible and taxable temporary differences to measure the deferred tax asset or liability. An exception is made for certain temporary differences arising from the initial recognition of an asset or a liability. No deferred tax asset or liability is recognised in relation to these temporary differences if they arose in a transaction, other than a business combination, that at the time of the transaction did not affect either accounting profit or taxable profit or loss.

Deferred tax assets are recognised for deductible temporary differences and unused tax losses only if it is probable that future taxable amounts will be available to utilise those temporary differences and losses.

Deferred tax liabilities and assets are not recognised for temporary differences between the carrying amount and tax bases of investments in controlled entities where the parent entity is able to control the timing of the reversal of the temporary differences and it is probable that the differences will not reverse in the foreseeable future.

Current and deferred tax balances attributable to amounts recognised directly in equity are also recognised directly in equity.

Acquisition of Subsidiaries and Businesses

Acquisitions of subsidiaries and businesses are accounted for using the acquisition method. The consideration for each acquisition is measured at the aggregate of the fair values (at the date of exchange) of assets given, liabilities incurred or assumed, and equity instruments issued by the Group in exchange for control of the acquiree. Acquisition-related costs are recognised in profit or loss as incurred.

Where applicable, the consideration for the acquisition includes any asset or liability resulting from a contingent consideration arrangement, measured at its acquisition-date fair value. Subsequent changes in such fair values are adjusted against the cost of acquisition where they qualify as measurement period adjustments (see below). All other subsequent changes in the fair value of contingent consideration classified as an asset or liability are accounted for in accordance with relevant Standards. Changes in the fair value of contingent consideration classified as equity are not recognised.

SECTION 8 FINANCIAL INFORMATION

1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONT.)

Acquisition of Subsidiaries and Businesses (cont.)

Where a business combination is achieved in stages, the Group’s previously held interests in the acquired entity are remeasured to fair value at the acquisition date (i.e. the date the Group attains control) and the resulting gain or loss, if any, is recognised in profit or loss. Amounts arising from interests in the acquiree prior to the acquisition date that have previously been recognised in other comprehensive income are reclassified to profit or loss, where such treatment would be appropriate if that interest were disposed of.

The acquiree’s identifiable assets, liabilities and contingent liabilities that meet the conditions for recognition under AASB 3 are recognised at their fair value at the acquisition date, except that:

deferred tax assets or liabilities and liabilities or assets related to employee benefit arrangements are recognised and measured in accordance with AASB 112 Income Taxes and AASB 119 Employee Benefits respectively;
liabilities or equity instruments related to the replacement by the Group of an acquiree’s share-based payment awards are measured in accordance with AASB 2 Share-based Payment; and
assets (or disposal groups) that are classified as held for sale in accordance with AASB 5 Non-current Assets Held for Sale and Discontinued Operations are measured in accordance with that Standard.

If the initial accounting for a business combination is incomplete by the end of the reporting period in which the combination occurs, the Group reports provisional amounts for the items for which the accounting is incomplete. Those provisional amounts are adjusted during the measurement period (see below), or additional assets or liabilities are recognised, to reflect new information obtained about facts and circumstances that existed as of the acquisition date that, if known, would have affected the amounts recognised as of that date.

The measurement period is the period from the date of acquisition to the date the Group obtains complete information about facts and circumstances that existed as of the acquisition date – and is subject to a maximum of one year.

The acquisition of Digital CC Holdings Pty Ltd (“Digital CC”), has been reflected in the pro forma Statement of Financial Position as at 31 December 2013. In accounting for the acquisition, the Group has taken guidance from the principles of AASB 3 Business Combinations (“AASB 3”) and determined that Digital CC would be deemed to be the acquirer for accounting purposes. Accordingly, the transaction is accounted for as a reverse asset acquisition. As a result, the pro forma consolidated Statement of Financial Position as at 31 December 2013 has been prepared as a continuation of the Digital CC financial statements, with Digital CC (as the accounting acquirer) accounting for the acquisitions as from 31 December 2013 (for the purposes of the consolidated pro forma Statement of Financial Position). As the activities of the legal acquirer (Macro Energy) would not constitute a business based on the requirements of AASB 3, any excess of the deemed consideration over the fair value of the acquisitions, as calculated in accordance with the reverse acquisition accounting principles, cannot be taken to goodwill and has been expensed.

SECTION 8 FINANCIAL INFORMATION

1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONT.)

Impairment of Assets

Assets that have an indefinite useful life are not subject to amortisation and are tested annually for impairment. Assets that are subject to amortisation are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. An impairment loss is recognised for the amount by which the asset’s carrying amount exceeds its recoverable amount. The recoverable amount is the higher of an asset’s fair value less costs to sell and value in use. For the purposes of assessing impairment, assets are grouped at the lowest levels for which there are separately identifiable cash flows (cash generating units).

Cash and Cash Equivalents

“Cash and cash equivalents” includes cash on hand, deposits held at call with financial institutions, other short-term highly liquid investments that are readily convertible to known amounts of cash and which are subject to an insignificant risk of changes in value, and bank overdrafts. Bank overdrafts are shown within borrowings in current liabilities on the Statement of Financial Position.

Receivables

Trade receivables are recognised initially at fair value and subsequently measured at amortised cost using the effective interest rate method less an allowance for doubtful debts. Trade receivables are due for settlement no more than 30 days from the date of recognition. An estimate of doubtful debts is made when collection of the full amount is no longer probable. Bad debts are written off as incurred.

Receivables are recognised initially at fair value and subsequently measured at amortised cost using the effective interest rate method less impairment.

The effective interest method is a method of calculating the amortised cost of a receivable and of allocating interest income over the relevant period. The effective interest rate is the interest rate that exactly discounts estimated future cash receipts (including all fees on points paid or received that form an integral part of the effective interest rate, transaction costs and other premiums or discounts) through the expected life of the receivable, or, where appropriate, a shorter period.

Property, Plant and Equipment

Plant and equipment is stated at historical cost less depreciation. Historical cost includes expenditure that is directly attributable to the acquisition of the items.

Subsequent costs are included in the asset’s carrying amount or recognised as a separate asset, as appropriate, only when it is probable that future economic benefits associated with the item will flow to the Group and the cost of the item can be measured reliably. All other repairs and maintenance are charged to the income statement during the financial period in which they are incurred.

Plant and equipment are depreciated or amortised on a reducing balance or straight line basis at rates based upon their expected useful lives as follows:

Hardware equipment 1 – 2 years

The assets’ residual values and useful lives are reviewed, and adjusted if appropriate, at each reporting date.

SECTION 8 FINANCIAL INFORMATION

1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONT.)

Plant and equipment (cont)

An asset’s carrying amount is written down immediately to its recoverable amount if the asset’s carrying amount is greater than its estimated recoverable amount.

Gains and losses on disposals are determined by comparing proceeds with carrying amount. These are included in the income statement.

Intangible assets

Intangible assets acquired in a business combination are identified and recognised separately from goodwill where they satisfy the definition of an intangible asset and their value can be measured reliably. Each period, the useful life of the assets are reviewed to determine whether events and circumstances continue to support and indefinite useful life assessment for the asset, such assets are tested for impairment in accordance with the Impairment of assets policy note above.

Payables

Liabilities for trade creditors and other amounts are carried at amortised cost which is the fair value of the consideration to be paid in the future for goods and services received, whether or not billed to the consolidated entity. The amounts are unsecured and are usually paid within 30 days.

Payables to related parties are carried at amortised cost.

Employee Benefits

Liabilities for wages and salaries, including non-monetary benefits, annual leave and accumulating sick leave expected to be settled within twelve months of the reporting date are recognised in provisions in respect of employees’ services up to the reporting date and are measured at the amounts expected to be paid when the liabilities are settled. Liabilities for non-accumulating sick leave are recognised when the leave is taken and measured at the rates paid or payable. Employee benefits payable later than one year are measured at the present value of the estimated future cash flows to be made for those benefits. Contributions to defined contribution super plans are expensed when the employees have rendered the services entitling them to the contributions.

Contributed Equity

Issued and paid up capital is recognised at the fair value of the consideration received by the Company.

Incremental costs directly attributable to the issue of new shares or options are shown in equity as a deduction, net of tax, from the proceeds. Incremental costs directly attributable to the issue of new shares or options, for the acquisition of a business are not included in the cost of the acquisition as part of the purchase consideration.

Goods and Services Tax

Revenues, expenses and assets are recognised net of the amount of GST except:

where the GST incurred on a purchase of goods and services is not recoverable from the taxation authority, in which case the GST is recognised as part of the cost of acquisition of the asset or as part of the expense item as applicable; and
receivables and payables are stated with the amount of GST included.

SECTION 8 FINANCIAL INFORMATION

1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONT.)

Goods and Services Tax (cont)

The net amount of GST recoverable from, or payable to, the taxation authority is included as part of receivables or payables in the Statement of Financial Position.

Cash flows are included in the Statement of Cash Flows on a gross basis and the GST components of cash flows arising from investing and financing activities, which are recoverable from, or payable to, the taxation authority, are classified as operating cash flows.

Share-Based Payments

The fair value of options granted (determined using the Binomial option pricing model) is recognised as an expense or asset, as appropriate with a corresponding increase in equity. The fair value is measured at grant date and recognised over the period during which option holders become unconditionally entitled to the options. The fair value determined at the grant date of the equity-settled share-based payments is expensed on a straight-line basis over the vesting period, based on the Group’s estimate of equity instruments that will eventually vest.

Foreign Currency Translation

(i) Functional and presentation currency

Items included in the financial information of each of the Group’s entities are measured using the currency of the primary economic environment in which the entity operates (“the functional currency”). The consolidated financial information is presented in Australian dollars, which is the Company’s functional and presentation currency.

(ii) Transactions and balances

Foreign currency transactions are translated into the functional currency using the exchange rates prevailing at the dates of the transactions. Foreign exchange gains and losses resulting from the settlement of such transactions and from the translation at year-end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognised in the income statement, except when deferred in equity as qualifying cash flow hedges and qualifying net investment hedges.

Translation differences on non-monetary items, such as equities held at fair value through profit or loss, are reported as part of the fair value gain or loss. Translation differences on nonmonetary items, such as equities classified as available-for-sale financial assets, are included in the available-for-sale investments revaluation reserve in equity.

(iii) Group companies

The results and financial position of all the Group entities (none of which has the currency of a hyperinflationary economy) that have a functional currency different from the presentation currency are translated into the presentation currency as follows:

Assets and liabilities for each statement of financial position presented are translated at the closing rate at the date of that statement of financial position;
Income and expenses for each income statement are translated at average exchange rates (unless this is not a reasonable approximation of the cumulative effect of the rates prevailing on the transaction dates, in which case income and expenses are translated at the dates of the transactions); and
All resulting exchange differences are recognised as a separate component of equity.

SECTION 8 FINANCIAL INFORMATION

1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONT.)

Foreign Currency Translation (cont)

On consolidation, exchange differences arising from the translation of any net investment in foreign entities, and of borrowings and other currency instruments designated as hedges of such investments, are taken to shareholders equity. Where a foreign operation is sold or borrowings repaid, a proportionate share of such exchange differences are recognised in the income statement as part of the gain or loss on sale.

Goodwill and fair value adjustments arising on the acquisition of a foreign entity are treated as assets and liabilities of the foreign entity and translated at the closing rate.

SECTION 8 FINANCIAL INFORMATION

2. SUMMARY OF PRO FORMA ADJUSTMENTS

The pro forma Statement of Financial Position has been derived from the historical financial information as at 31 December 2013 adjusted to give effect to the following actual or proposed significant events and transactions by Macro Energy Limited (Company) subsequent to 31 December 2013:

(i) the consolidation of the existing issued shares of Macro Energy Limited from 217,607,664 to 38,076,581 based on a 1 for 5.715 ratio;
(ii) Digital CC issued share capital of 10,000 shares for a total of $300,000 as at the 31 December 2013 pro-forma balance sheet date;
(iii) the consolidation of the existing options on issue in Macro Energy Limited from 16,000, 000 to 2,799,649;
(iv) the issue of ordinary fully paid shares to Vendors being 82,764,655 shares at 20 cents each, 24,950,130 performance rights and 8,316,710 options issued to shareholders of Digital CC on a post consolidation basis;
(v) the issue of 45,500,000 ordinary fully paid shares on a post consolidation basis at 20 cents each pursuant to a share placement raising $9.1m before costs;
(vi) The issue of 1,600,000 ordinary fully paid shares on a post consolidation basis at 20 cents each totalling $320,000 as an introductory fee to DJCarmichael;
(vii) the issue of 6,000,000 options on a pre consolidation basis (on a post consolidation basis 1,049,869) to Sibella Capital Pty Ltd in consideration for services provided to the Company not forming part of the consideration of the transaction between the Company and Digital CC;
(viii) payment of costs associated with the Offer of $364,000 for a $9.1m capital raising and additional estimated costs associated with the Offer of $411,984 relating to legal and professional fees;
(ix) loans provided to Digital CC from Lydian Enterprises Pty Ltd ($1,700,000) and Technology IQ Limited ($20,328) (excluding additional loans of up to $1,100,000) to fund the commencement of the business of Digital CC and which is not being converted into equity as part of the Offer, and the subsequent repayment of these loans to Lydian Enterprises Pty Ltd and Technology IQ Limited;
(x) loans provided to Digital CC from the Vendors ($803,321) to fund the commencement of the business of Digital CC and which is being offset with the Vendors’ purchase of shares pursuant to the Offer;
(xi) The purchase of hardware and hosting costs totalling $3,758,807. In accordance with Macro Energy’s accounting policy the hardware costs of $3,362,700 have been capitalised in the year and the hosting costs of $396,107 have been treated as a prepayment.

SECTION 8 FINANCIAL INFORMATION

3. CASH ASSETS

Macro Energy cash at bank 31 December 2013 Adjustments arising from the acquisition of the Group Digital CC Pty Ltd cash and cash equivalents at 31 December 2013 Loan from Lydian Enterprises Pty Ltd Loan from Technology IQ Limited Loans from the Vendors’ participating in the Offer Repayment of loans to Lydian Enterprises Pty Ltd, Technology IQ Limited and the Vendors Purchase of hardware and hosting licence Capital raising Share issue costs Additional share issue costs (estimate) 4. PROPERTY PLANT AND EQUIPMENT Macro Energy property plant and equipment at 31 December 2013 Adjustments arising from the acquisition of the Group Acquisition of hardware equipment		Macro Energy Limited 31 December 2013 Pro forma 31 December 2013 $ $
		3,319,105 3,319,105 - 300,000 - 1,700,000 - - - - 20,328 803,321 (2,523,649) (3,758,807) - 9,100,000 - - (364,000) (411,984)
		3,319,105 8,184,314
		Macro Energy 31 December 2013 Pro forma 31 December 2013 $ $
		2,912 2,912 - 3,362,700
		- 3,365,612

SECTION 8 FINANCIAL INFORMATION

5. BORROWINGS

5. BORROWINGS
Loans payable to Lydian Enterprises Pty Ltd Loans payable to Technology IQ Limited Loans from the Vendors’ participating in the Offer Repayment of loans to Lydian Enterprises Pty Ltd, Technology IQ Limited and the Vendors’	Macro Energy 31 December 2013 Pro forma 31 December 2013 $ $
	- 1,700,000 - - - 20, 328 803,321 (2,523,649)
	- -

6. ISSUED CAPITAL

Issued capital Adjustments arising from the acquisition of Digital CC Elimination of Macro Energy capital on consolidation Digital CC issued capital as at 31 December 2013 Consideration for the acquisition(Note 1) Shares issued DJ Carmichael Shares issued pursuant to capital raising Share issue costs Additional share issue costs (estimate)	Macro Energy Limited 31 December 2013 $ Pro forma 31 December 2013 $
	29,011,690 29,011,690 - (29,011,690) - 300,000 - - 1,371,346 320,000 - - - 9,100,000 (364,000) (411,984) 29,011,690 10,315,362

SECTION 8 FINANCIAL INFORMATION

6. ISSUED CAPITAL (CONT)

6. ISSUED CAPITAL (CONT)
Number of shares Issued capital Share consolidation (ratio 5.715 to 1) Vendor shares issued Shares issued pursuant to capital raising	Macro Energy Limited 31 December 2013 Pro forma 31 December 2013 # #
	217,607,664 217,607,664 - (179,531,083) - 82,764,655 - 47,100,000
	217,607,664 167,941,236

Notes

Note 1 – Consideration for the acquisition.

In accordance with reverse asset acquisition accounting principles the consideration is deemed to hav e been incurred by Digital CC in the form of equity instruments issued to Macro Energy shareholders. The acquisition date fair v alue of this consideration has been determined with reference to the fair v alue of the issued shares of Macro Energy immediately prior to the acquisition and has been determined to be $1,371,982, based on 31% of 217,607,664 shares at the closing share price on 31 December 2013 of $0.02 per share.

The consideration fair v alue has been determined using v alues at pro forma date being 31 December 2013. At the actual acquisition date the fair v alue will be required to be determined again, therefore, the fair v alue and consideration could be materially different which will impact the excess deemed consideration on acquisition (refer note 7).

7. ACCUMULATED LOSSES

Macro Energy accumulated losses at 31 December 2013 Adjustments arising from the acquisition of Digital CC Elimination of Macro Energy accumulated losses on consolidation Recognition of Digital CC accumulated losses at 31 December 2013 Options issued to Sibella Capital Ltd for services provided to the Company Share issue expense DJ Carmichael introduction fee Excess deemed consideration on acquisition	Macro Energy Limited 31 December 2013 Pro forma 31 December 2013 $ $
	(27,108,953) (27,108,953) - 27,108,953 - - - - (3,376) (92,388) (320,000) (657,433)
	(27,108,953) (1,073,197)

Macro Energy accumulated losses at 31 December 2013
Adjustments arising from the acquisition of Digital CC
Elimination of Macro Energy accumulated losses on
consolidation
Recognition of Digital CC accumulated losses at 31
December 2013
Options issued to Sibella Capital Ltd for services provided to
the Company
Share issue expense DJ Carmichael introduction fee
Excess deemed consideration on acquisition

Macro Energy
Limited
31 December
2013
Pro forma
31 December
2013
$ $

(27,108,953)
(27,108,953)
-
27,108,953
-
-
-
-
(3,376)
(92,388)
(320,000)
(657,433)

(27,108,953)
(1,073,197)

SECTION 8 FINANCIAL INFORMATION

8. RESERVES

8. RESERVES
			Macro
			Energy
			Limited		Pro forma
			31 December		31 December
				2013	2013
				$	$
Other Equity Settled reserve			1,198,998		1,198,998
Foreign Currency Translation reserve			(493,613)		(493,613)
Option Premium reserve			833,672		833,672
Elimination of Macro Energy reserves				-	(1,539,057)
Fair value of options issued and performance rights to
acquire interests in assets (note 9)				-	2,820,269
			1,539,057		2,820,269
9. OPTIONS
			Macro Energy
			Limited		Pro forma
			31 December	Fair	31 December
			2013	Value	2013
Option Premium reserve			#	$	$
Macro Energy Opening Balance (Note 1)			16,633,420		833,672
Adjustments arising from the acquisition
of Digital CC:
Consolidation of Macro Energy reserve (5.715		to 1)	(13,200,350)		(833,672)
Options to be issued by Macro Energy to Digital
CC shareholders in connection	with	the
acquisition (Note 1)			8,316,710	0.088	731,871
Options to be issued by Macro Energy	to Sibella
Capital Pty Ltd for services provided to		the
Company			1,049,869	0.088	92,388
			12,166,229		824,259

SECTION 8 FINANCIAL INFORMATION

9. OPTIONS (CONT) Other Equity Settled reserve Macro Energy Opening Balance Adjustments arising from the acquisition of Digital CC: Elimination of Macro Energy reserve on consolidation Performance rights consideration (Note 2) Notes	Macro Energy Limited 31 December 2013 Fair Value Pro forma 31 December 2013 # $ $
	- 1,198,998 - (1,198,998) 24,950,130 0.16 1,996,010
	24,950,130 2,820,269

Note 1 - Valuation of Options

The consideration options issued to acquire interests in assets were v alued using the Black Scholes option model using the following inputs:

Underlying share price	20 cents per share
Option exercise price	28 cents per share
Option expiry date	31 March 2016
Share price v olatility	130%
Risk free interest rate	2.775%.

Note 2 - Valuation of Performance rights

The fair v alues of the performance rights issued to acquire interests in assets were v alued using the v aluation criteria in AASB 2 using the following inputs:

Underlying share price of Macro Energy Ltd pre-IPO	$0.16
Probability factor	50%.

11. RELATED PARTIES

Transactions with Related Parties and Directors Interests are disclosed in the Prospectus (Section 4.22).

12. CONTINGENT LIABILITIES

At the date of the report no material contingent liabilities exist that we are aware of.

13. SUBSEQUENT EVENTS

Further information on the trading activities of Digital CC up to the end of April 2014 was released to the ASX on 6 May 2014.

9. RISK FACTORS

The business, assets and operations of the Company, including after completion of the Acquisition, are subject to certain risk factors that have the potential to influence the operating and financial performance of the Company in the future. These risks can impact on the value of an investment in the securities of our Company. The Company’s Securities comprise a speculative investment, particularly as it is proposed for the Company’s business after the Acquisition to comprise participation in the digital currency sector and its associated business ecosystems.

The Board aims to manage these risks by carefully planning its activities and implementing risk control measures. Some of the risks are, however, highly unpredictable and the extent to which they can effectively manage them is limited.

Set out below are specific risks that the Company is exposed to.

Shareholders should be aware that if the Acquisition is approved and completed, the Company will be changing the nature and scale of its activities and will be subject to additional or increased risks arising from Digital CC, parties contracted or associated with Digital CC and the Agreement and other agreements, including, but not limited to, those summarised in this Prospectus. The risks and uncertainties described below are not intended to be exhaustive. The summary of risks that follows is not intended to be exhaustive and this Prospectus does not take into account the personal circumstances, financial position or investment requirements of any particular person. There may be additional risks and uncertainties that the Company is unaware of or that the Company currently considers to be immaterial, which may affect the Company, Digital CC and their related entities and consequently Applicants. Based on the information available, a non-exhaustive list of risk factors for the Company associated with the Company’s proposal to acquire all Digital CC’s Shares are as follows.

9.1 Company specific risks

In addition to the key risk factors summarised in Section 4.4, there are a number of specific risks involved for the Company, and consequently its Security holders, in the acquisition of Digital CC, including risks specific to the business and assets of Digital CC, which include the following non-exhaustive list.

(a) Limited history and limited relevant experience of Proposed Directors and management

Digital CC was only recently incorporated (28 January 2014) and has limited operating history and historical financial performance. Further, none of the Proposed Directors or proposed management of the Company have experience as a director or executive of an ASX Listed entity and they consequently have limited expertise in that regard.

No assurance can be given that Digital CC or the Company will achieve commercial viability through participation in the digital currency sector and its associated business ecosystems.

(b) Additional requirements for capital

Failure to obtain sufficient financing for the Company’s and Digital CC’s activities and future projects may result in delay and indefinite

postponement of their activities and potential development programmes. There can be no assurance that additional finance will be available when needed or, if available, the terms of the financing might not be favourable to the Company or Digital CC and might involve substantial dilution to Shareholders.

The Company is exposed to risks associated with its financial instruments (consisting of digital currency (including Bitcoin), cash, receivables, accounts payable and accrued liabilities due to third parties from time to time). This includes the risk that a third party to a financial instrument fails to meet its contractual obligations, the risk that the Company will not be able to meet its financial obligations as they fall due and the risk that market prices may vary which will affect the Company’s financial position and prospects.

The funds raised under the Offer are considered sufficient, when combined with existing funding, to meet the immediate objectives of the Company. Additional funding may be required in the event costs exceed the Company’s estimates and to effectively implement its business and operations plans in the future (including in relation to Digital CC) to take advantage of opportunities for acquisitions, joint ventures or other business opportunities, and to meet any unanticipated liabilities or expenses which the Company may incur. If such events occur, additional financing will be required.

The Company may seek to raise further funds through equity or debt financing, joint ventures, licensing arrangements, or other means. Failure to obtain sufficient financing for the Company’s and Digital CC’s activities and future projects may result in delay and indefinite postponement of their activities and potential development programmes. There can be no assurance that additional finance will be available when needed or, if available, the terms of the financing might not be favourable to the Company or Digital CC and might involve substantial dilution to Shareholders.

(c) Market for Shares

The Company is currently suspended from trading on ASX pursuant to ASX’s policies on transaction of this nature. There can be no guarantee that an active market in the Company’s Shares will develop upon completion of the proposed acquisition of all shares in Digital CC pursuant to the Agreement, if the Company is then reinstated to quotation after re-complying with Chapters 1 and 2 of the ASX Listing Rules.

(d) Bitcoin mining risks

As defined in Section 6.5, Bitcoin ‘mining’ is the term used to describe the process of earning new Bitcoins which can be converted to fiat currencies. The process involves using powerful computer technology to provide a service to the Bitcoin network of verifying Bitcoin transactions. New Bitcoins are created and assigned by the Bitcoin network to the providers of verification services. The number of Bitcoins awarded to a given Bitcoin miner is related to the amount of Bitcoin mining hardware that miner has in operation, in proportion to the total size of the Bitcoin mining network. The term ‘miners’ refers to those engaged in Bitcoin mining. They sometimes form ‘mining pools’ by combining their ‘hashing power’ (defined in Section 6.6) with other miners.

As the number of Bitcoins awarded for solving a Block in the Blockchain decreases, the incentive of miners to continue to contribute processing power to the Bitcoin network will transition from a set reward to transaction fees. The requirement from miners of higher transaction fees in exchange for recording transactions in the Blockchain may decrease demand for Bitcoins and prevent the expansion of the Bitcoin network to retail merchants and commercial business, resulting in a reduction in the Blended Bitcoin Price.

If the award of Bitcoins for solving Blocks and transaction fees for recording transactions are not sufficiently high to incentivise miners, miners may cease expending processing power to solve Blocks and confirmations of transactions on the Blockchain could be slowed. A reduction in the processing power expended by miners on the Bitcoin network could increase the likelihood of a malicious actor or botnet obtaining control in excess of 50 percent of the processing power active on the Bitcoin network or the Blockchain, permitting such an actor or botnet to manipulate the source of the Bitcoin network in a manner that adversely affects Digital CC and consequently the Company or their ability to operate.

(e) Dilution risk and ability to affect the Company’s direction

New investors who subscribe under the Offer may own a relatively small ownership of the Company.

These new investors will be unlikely to be able to significantly affect the Company’s direction by exercising their voting rights in the usual manner. There are also Options on issue in the Company and New Options and Performance Rights proposed to be issued to the Vendors as part of the Vendor Consideration Securities and Options to be issued to Sibella Capital Pty Ltd. If these Options are converted into Shares or if the Performance Rights vest into Shares there will be a dilution of the Company’s existing Shareholders.

(f) Conditions of the Offer and issue of Vendor Consideration Securities

The Offer and issue of Vendor Consideration Securities are subject to the conditions referred to in Sections 4.9 and 5.5, which must be satisfied

prior to issue of Shares pursuant to the Offer and completion of the Agreement by issue of the Vendor Consideration Securities. If the applicable conditions are not satisfied, the Offer and completion of the Agreement and Acquisition may not proceed.

(g) Development and commercialisation of products

Bitcoins (and other digital currencies) are a volatile cryptocurrency and fluctuations in their price will have impact on Digital CC and consequently the Company, if the Acquisition occurs, given that Digital CC’s business concerns the ownership, mining, trading and development of products for cryptocurrencies such as Bitcoins. In addition, there is no assurance that Bitcoins or any other digital currency which the Company or Digital CC may acquire an interest in will maintain their long-term value in terms of purchasing power in the future or that the acceptance of digital currency payments by mainstream retail merchants and commercial businesses will grow. In the event that the price of Bitcoins (or any other digital currency in which the Company or Digital CC may acquire an interest) declines, this would likely adversely impact the value of Digital CC and consequently the Company (subject to any potential trading by Digital CC on such market volatility).

(h) Further technology risks

The Bitcoin technology and other digital currencies may be rendered obsolete by new inventions and technologies, which would adversely impact Digital CC and consequently the Company.

Further, the administrators of the Bitcoin network’s source code or other users could propose amendments to the Bitcoin network’s protocols and software that, if accepted and authorized by the Bitcoin network’s community, could adversely affect Digital CC and consequently the Company.

users and miners on the Bitcoin network install such software upgrade(s), the Bitcoin network could “fork”. The acceptance of Bitcoin network software patches or upgrades by a significant, but not overwhelming, percentage of the users and miners in the Bitcoin network could result in a “fork” in the Blockchain, resulting in the operation of two separate networks until such time as the forked Blockchains are merged. The temporary or permanent existence of forked Blockchains could adversely impact Digital CC and consequently the Company.

There is also a risk that malicious actors or a botnet could further corrupt the Blockchain such that double-spending of Bitcoins could occur. If this occurs on a significant scale, the integrity of Bitcoin would come into question and the Bitcoin price may fall significantly.

(i) Contractual risks

(i) Agreements for the purchase of hardware

Digital CC Management Pty Ltd will acquire computing hardware from suppliers (and potentially directly from manufacturers) from time to time. As summarised above, an agreement has been made with Bitfury Limited, a supplier.

It is commonplace in this industry, and a term of the Bitfury Agreement, that down payments be made with respect to hardware purchases before delivery of the hardware. This permits the supplier to fund the manufacture of the hardware which is ‘made to order’. Whilst the exposure is attempted to be minimised by the granting of a security interest in the hardware being purchased and various compensation clauses being incorporated into such agreements, there is no guarantee that the security interest could be perfected, or that the supplier will have sufficient assets to fund the compensation.

Further, it is unlikely that the manufacturer (who in the case of the Bitfury Agreement is located in Asia) would maintain insurances sufficient to cover replacement value of the hardware and loss of revenue in the interim in the case of destruction of the hardware during the manufacturing process.

(ii) Governing law and jurisdictional issues

Due to the nature of the Bitcoin industry, agreements such as those with respect to mining agreements and hardware are generally made with businesses who are domiciled outside of Australia.

As a result, the laws of other countries need to be taken into account in such agreements, and the rights that a party might usually have under Australian law may not be available.

In the event of enforcement or dispute, Digital CC may need to commence proceedings in a Court, or undertake arbitration dispute resolution proceedings, in a country other than Australia. In such circumstances, the laws of those countries will apply and the cost of such enforcement or dispute is likely to be relatively higher than if the agreement was being enforced or disputed in Australia.

In every case, where Australian law will not govern an agreement, Digital CC has taken measures, to the extent possible, to have the agreements governed by the law of jurisdictions with a similar legal background to Australia such as the United Kingdom, but it must be borne in mind that even so, such countries remain foreign jurisdictions and their own bodies of law apply.

The identity of the contracting foreign parties is attempted to be verified prior to entering into any such agreements, but the verification process may not be without errors, omissions or faults.

(j) Competition

There is significant competition in the digital currency industry generally. There is no assurance that Digital CC or the Company will succeed in the strategy of mining and trading Bitcoins or developing products that are effective or economic. Competitors’ products may render the potential digital currency products obsolete and/or otherwise uncompetitive. There is also no guarantee that the Company or Digital CC will ever commercialise or produce any products from the Digital CC technology.

The Company and Digital CC may be unable to compete successfully against future competitors where aggressive policies are employed to capture market share. If the Company or Digital CC are successful in developing digital currency products, which may never occur, such competition could result in price reductions, reduced gross margins and loss of market share, any of which could materially adversely affect the Company’s and Digital CC’s potential future business, operating results and financial position.

9.2 Industry specific risks

(a) Legal and Regulatory risks

Digital currencies involve relatively new technology which has been identified as possibly posing risks in relation to law enforcement and

government regulation. It is likely that governments worldwide, including Australia, will continue to explore the benefits, risks, regulations, security and applications of digital currencies, such as Bitcoin.

The introduction of new legislation or amendments to existing legislation by governments, or the respective interpretation of the legal requirements in any of the legal jurisdictions which govern the Company’s or Digital CC’s operations or contractual obligations, could impact adversely on the assets, operations and, ultimately, the financial position and financial performance of Digital CC and the Company and its Securities. In addition there is a risk that legal action may be taken against the Company and Digital CC in relation to commercial, legal, regulatory or other matters.

(b) Risk of higher transaction fees

Currently there are minimal transaction fees incurred on transactions conducted using Bitcoin. However, as the number of Bitcoins awarded to miners for solving the mathematical equation to create a Block decreases, the incentive to continue mining will fall. Once the majority of the Bitcoins have been mined, there will be no incentive for miners to continue mining unless they are paid a transaction fee. However, it will not be until 2032 that 99% of the Bitcoins will be mined, and therefore this is not a short term risk. Refer to Section 6 for a further explanation of concepts relevant to Bitcoin.

If the transaction fees are too low, then there will be less of an incentive for miners and some may cease mining. This would result in a reduction in the Bitcoin network’s hashing power and would make it easier for one user to control more than 50% of the hashing power. This may result in corruption of the Blockchain. If this occurred, the value of Bitcoin would be adversely affected.

Alternatively, if the transaction fees are too high, consumers and merchants may no longer wish to use Bitcoin and the demand for the currency would fall. This would also have an adverse effect on Bitcoin.

(c) Risk of losing Bitcoins

Bitcoins need to be stored in either a wallet or at an exchange. In order to access Bitcoins, the user has a private key (similar to a password) that only they know. Using this key enables them to spend the funds allocated to their wallet. However, if the user loses their private key, they will be unable to access their Bitcoins and those Bitcoins will be unusable until such time as the user remembers their private key or a hacker hacks their wallet. Unlike a bank that could confirm a person’s identity by another means in the event that a password to a bank account is lost, there is no such system for gaining access to a wallet once the private key is lost.

There is also a risk that if a wallet password is stored on a personal computer, a hacker may be able to hack into that computer, obtain the password and use it to steal Bitcoins from the wallet. In the event that this occurs, the true owner of those Bitcoins has no recourse and cannot retrieve their Bitcoins. For example, on 4 March 2014, Flexcoin, a Bitcoin bank, announced that it was closing after the 896 Bitcoins (approximately $0.6 million) that were stored at the bank were stolen by hackers. This contrasts with banks which will investigate any allegations

of fraud or theft and will reimburse their customers if it turns out that the customer has been the victim of fraud or theft.

Bitcoins held with an exchange may also be lost as those coins held by Mt Gox were lost. Again this is in contrast to a bank where the government may guarantee all deposits held by the bank; as is the case for banks in Australia.

(d) Limited number of merchants that accept Bitcoin

While the number of merchants that accept Bitcoins has certainly risen over the past 12 months, the overwhelming majority of merchants still do not accept Bitcoins as a means of payment. This limits the ways in which Bitcoins can be spent and is therefore a deterrent for some people that might otherwise consider using Bitcoin.

(e) Volatility

As shown in Section 6.8, the price of Bitcoin is volatile. This is largely due to Bitcoin being relatively new. Bitcoin’s volatility acts as a deterrent for many investors and merchants. Investors see it as a weakness because the value of their investment could be significantly reduced in a short space of time. Merchants see it as a weakness because of the inconvenience it causes them since they have to constantly update their prices to reflect changes in the Bitcoin price.

(f) Uncertainty regarding the future of digital currencies

Since digital currencies are still in a relatively new concept, there is significant uncertainty as to whether any growth in digital currencies will eventuate. If one or more of the other digital currency risks highlighted in this Prospectus eventuated, the market price of Bitcoin and other digital currencies may fall.

If the market prices of Bitcon or other digital currencies in which Digital CC has an existing or potential interest falls, Digital CC’s existing and potential interest in digital currency and digital currency products would be detrimentally affected. This would adversely affect the Company and the value of the Company’s Shares.

(g) Bitcoins may be hoarded

While the limited number of Bitcoins is one of the primary features that give Bitcoins their value (as described in Section 6.9), there is a risk that this could encourage hoarding. Hoarding would involve people buying/mining Bitcoins and then simply holding on to them and not spending them with the hope of making a profit in the future. This action may reduce the liquidity in the Bitcoin market. While the supply shortage may result in an initial increase in price, prolonged hoarding would eventually lead to a significant fall in the price and may send Bitcoin into recession, which would adversely impact Digital CC’s and the Company’s business.

(h) Loss of Bitcoin’s market share

There is a risk that Bitcoin may lose its first-mover advantage as one or more other digital currencies start eating into Bitcoin’s market share. There are numerous other digital currencies and indeed any person can create their own digital currency. However, current statistics do not

guarantee that Bitcoin will always be number one. With technology developing and with so many new digital currencies being created, it is possible that a new digital currency will emerge as the market favourite.

Although other digital currencies are available, Bitcoin still currently has one significant advantage over all other digital currencies; Bitcoin is accepted by more merchants than any other digital currency. Today, Bitcoin is an acceptable payment method for a multitude of business in a variety of industries including hospitality, retail, travel, entertainment, automotive, healthcare and medical. This is perhaps the biggest barrier that other digital currencies will need to overcome in their attempts to take market share away from Bitcoin.

In addition to Bitcoin, Digital CC has existing and proposed activities relating to other digital currencies, as described in Section 7.5.

(i) Insurance risks

The Company intends to insure its operations and those of Digital CC in accordance with technology industry practice. However, particularly given the novelty of the digital currencies business and associated businesses, such insurance may not be available in relation to many of Digital CC’s and the Company’s proposed activities and even to the extent that insurance may be available, it may be of a nature or level insufficient to provide adequate insurance cover. The occurrence of an event that is not covered or fully covered by insurance could have a material adverse effect on the business, financial condition and results of the Company and Digital CC. Further, the Company and Digital CC may not be able to recover under any insurance policies if the company or companies providing the insurance (or any reinsurance) are under financial distress or fail.

9.3 General risks

(a) Market acceptance

The global marketplace for most products is ever changing due to new technologies, new products, changes in preferences, changes in regulation and other factors influencing market acceptance or market rejection. This market volatility and risk exists despite the best endeavours of market research, promotion and sales and licensing campaigns.

Accordingly, there is a risk that the Company and Digital may not be able to commercialise digital currencies such as Bitcoins and any further potential digital currency products, which could adversely impact their operations.

(b) Management of growth

There is a risk that management of the Company will not be able to implement the Company’s growth strategy after completion of the Offer. The capacity of the Company’s management to properly implement and manage the strategic direction of the Company and Digital CC may affect their financial performance.

General economic conditions, introduction of tax reform, new legislation (particularly in relation to relatively new digital currencies such as Bitcoin), movements in interest and inflation rates and currency exchange rates may have an adverse effect on the Company’s and Digital CC’s business activities and potential development programmes, as well as on their ability to fund those activities.

(d)

Force Majeure

The Company’s and Digital CC’s projects now or in the future may be adversely affected by risks outside the control of the Company and Digital CC, including labour unrest, civil disorder, war, subversive activities or sabotage, fires, floods, explosions or other catastrophes, epidemics or quarantine restrictions.

(e)

Litigation risks

The Company and Digital CC are exposed to possible litigation risks including, but not limited to, intellectual property claims, regulatory intervention and third party claims in relation to digital currency, occupational health and safety claims and employee claims. Further, the Company or Digital CC may be involved in disputes with other parties in the future which may result in litigation. Any such claim or dispute if proven, may impact adversely on the Company’s and Digital CC’s operations, financial performance and financial position. The Company and Digital CC are not currently engaged in any litigation.

(f)

Dependence on outside parties

The Company may pursue a strategy that forms strategic business relationships with other organisations in relation to potential products and services. There can be no assurance that the Company will be able to attract such prospective organisations and to negotiate appropriate terms and conditions with these organisations or that any potential agreements with such organisations will be complied with.

(g)

Market conditions

Share market conditions may affect the value of the Company’s quoted Securities regardless of the Company’s operating performance. Share market conditions are affected by many factors such as:

(i) general economic outlook;
(ii) introduction of tax reform or other new legislation;
(iii) interest rates and inflation rates;
(iv) changes in investor sentiment toward particular market sectors;
(v) the demand for, and supply of, capital; and
(vi) terrorism or other hostilities.

The market price of securities can fall as well as rise and may be subject to varied and unpredictable influences on the market for equities in general and technology stocks in particular. Neither the Company nor the Directors warrant the future performance of the Company or Digital

CC or any return to Security holders arising from the Offer, the Acquisition or any other event or occurrence.

(h) Reliance on key personnel

The responsibility of overseeing the day-to-day operations and the strategic management of the Company and Digital CC depends substantially on senior management and its key personnel (including the Proposed Directors). There can be no assurance given that there will be no detrimental impact on the Company and Digital CC if one or more of these employees cease their employment or if one or more of the Proposed Directors leaves the Board.

(i)

Investment speculative

The above list of risk factors ought not to be taken as exhaustive of the risks faced by the Company or Digital CC or by investors in the Company. The above factors, and others not specifically referred to above, may in the future materially affect the financial performance of the Company and Digital CC and the value of the Securities offered under this Prospectus

Therefore, the Securities to be issued pursuant to this Prospectus carry no guarantee with respect to the payment of dividends, returns of capital or the market value of those Securities.

Potential investors should consider that the investment in the Company is highly speculative and should consult their professional advisers before deciding whether to apply for Securities pursuant to this Prospectus.

10. BOARD, MANAGEMENT AND CORPORATE GOVERNANCE

10.1 Directors and key personnel

In accordance with the terms of the Agreement and with effect from the completion of the Acquisition, Mark Freeman and Scott Jones will retire as the Directors of the Company and four nominees of Digital CC, being the Proposed Directors, will be casually appointed to the Board of the Company.

Brett Lawrence is entitled to a termination notice period of 3 months plus accrued leave. Mark Freeman and Scott Jones are each entitled to a termination notice period of 1 month.

The Proposed Directors will not initially receive remuneration in their capacities as directors, but those also appointed as executives will receive remuneration in accordance with the summary in Section 11.3.

Detailed summaries of the background and experience of each of Brett Lawrence and the Proposed Directors are set out in Section 4.17 of the Prospectus

10.2 Management

In addition to the executive capacities of the Proposed Directors Zhenya Tsvetnenko, Alex Karis William Brindise, the following additional key management personnel are proposed to be appointed to the Company on or around completion of the Acquisition. Please refer to Section 11.3 for a summary of their key remuneration terms.

Mark Laybourn Proposed Chief Financial Officer

Mr Laybourn has 12 years’ experience in investment banking, valuations, due diligence, accounting and auditing. Mr Laybourn was previously an Associate Director in the Corporate Finance team at Euroz Securities Limited where he gained extensive experience working with listed companies across multiple sectors including technology. Prior to this Mr Laybourn was a Manager with Deloitte’s Corporate Finance and Assurance & Advisory teams. Mr Laybourn is a Chartered Accountant and holds a Bachelor of Commerce (Accounting and Information Systems) from Curtin University and Graduate Diploma of Applied Finance and Investment from the Financial Services Institute of Australia.

Fabricio Rodriguez Proposed Chief Technology Officer

Mr Rodriguez has 17 years' experience in full service web development, as Chief Technology Officer for Online Environs Inc (OEI) managing clients such as the New England Patriots, Intel, Nickelodeon, EMC and Compaq computers. From 2006, Mr Rodriguez specialized in the premium mobile space in a consulting capacity. Mr Rodriguez holds a Bachelor of Science degree in Mechanical Engineering from MIT.

Our Company is aware of the need to have sufficient management to properly manage Digital CC’s digital currency business and the Board will continually monitor the management roles in the Company. The Board may look to appoint additional management and/or consultants when and where appropriate to ensure proper management of the Company and Digital CC.

10.3 ASX Corporate Governance Council Principles and Recommendations

Our Company has adopted comprehensive systems of control and accountability as the basis for the administration of corporate governance. The Board is committed to administering the policies and procedures with openness and integrity, pursuing the true spirit of corporate governance commensurate with the Company's needs.

To the extent applicable, our Company has adopted The Corporate Governance Principles and Recommendations (2nd Edition) as published by ASX Corporate Governance Council (Recommendations).

In light of the Company’s size and nature, the Board considers that the current board is a cost effective and practical method of directing and managing the Company. As the Company’s activities develop in size, nature and scope, the size of the Board and the implementation of additional corporate governance policies and structures will be reviewed.

The Company’s main corporate governance policies and practices as at the date of this Prospectus are outlined below and the Company’s full Corporate Governance Plan is available in a dedicated corporate governance information section of the Company’s website (www.macroenergyltd.com.au).

Board of directors

The Board is responsible for corporate governance of the Company. The Board develops strategies for the Company, reviews strategic objectives and monitors performance against those objectives. The goals of the corporate governance processes are to:

(a) maintain and increase Shareholder value;
(b) ensure a prudential and ethical basis for the Company’s conduct and activities; and
(c) ensure compliance with the Company’s legal and regulatory objectives.

Consistent with these goals, the Board assumes the following responsibilities:

(a) developing initiatives for profit and asset growth;
(b) reviewing the corporate, commercial and financial performance of the Company on a regular basis;
(c) acting on behalf of, and being accountable to, the Shareholders; and
(d) identifying business risks and implementing actions to manage those risks and corporate systems to assure quality.

The Company is committed to the circulation of relevant materials to Directors in a timely manner to facilitate Directors’ participation in the Board discussions on a fully-informed basis.

Composition of the Board

Election of Board members is substantially the province of the Shareholders in general meeting.

Identification and management of risk

The Board’s collective experience will enable accurate identification of the principal risks that may affect the Company’s business. Key operational risks and their management will be recurring items for deliberation at Board meetings.

Ethical standards

The Board is committed to the establishment and maintenance of appropriate ethical standards.

Independent professional advice

Subject to the Chairman’s approval (not to be unreasonably withheld), the Directors, at the Company’s expense, may obtain independent professional advice on issues arising in the course of their duties.

Remuneration arrangements

The remuneration of an executive Director will be decided by the Board, without the affected executive Director participating in that decision-making process.

The total maximum remuneration of non-executive Directors is set in accordance with the Constitution and subsequent variation is by ordinary resolution of Shareholders in general meeting in accordance with the Constitution, the Corporations Act and the ASX Listing Rules, as applicable. The determination of non-executive Directors’ remuneration within that maximum will be made by the Board having regard to the inputs and value to the Company of the respective contributions by each non-executive Director.

In addition, a Director may be paid fees or other amounts (i.e. subject to any necessary Shareholder approval, non-cash performance incentives such as Options) as the Directors determine where a Director performs special duties or otherwise performs services outside the scope of the ordinary duties of a Director.

Directors are also entitled to be paid reasonable travelling, hotel and other expenses incurred by them respectively in or about the performance of their duties as Directors.

The Board reviews and approves the remuneration policy to enable the Company to attract and retain executives and Directors who will create value for Shareholders having consideration to the amount considered to be commensurate for a company of its size and level of activity as well as the relevant Directors’ time, commitment and responsibility. The Board is also responsible for reviewing any employee incentive and equity-based plans including the appropriateness of performance hurdles and total payments proposed.

Trading policy

The Board has adopted a policy that sets out the guidelines on the sale and purchase of securities in the Company by its key management personnel (i.e. Directors and, if applicable, any employees reporting directly to the managing director). The policy generally provides that the written acknowledgement of the Chair (or the Board in the case of the Chairman) must be obtained prior to trading.

External audit

The Company in general meetings is responsible for the appointment of the external auditors of the Company, and the Board from time to time will review the scope, performance and fees of those external auditors.

Audit committee

The Company will not have a separate audit committee until such time as the Board is of a sufficient size and structure, and the Company’s operations are of a sufficient magnitude for a separate committee to be of benefit to the Company. In the meantime, the full Board will carry out the duties that would ordinarily be assigned to that committee under the written terms of reference for that committee, including but not limited to, monitoring and reviewing any matters of significance affecting financial reporting and compliance, the integrity of the financial reporting of the Company, the Company’s internal financial control system and risk management systems and the external audit function.

Diversity policy

The Board has adopted a diversity policy which provides a framework for the Company to achieve, amongst other things, a diverse and skilled workforce, a workplace culture characterised by inclusive practices and behaviours for the benefit of all staff, improved employment and career development opportunities for women and a work environment that values and utilises the contributions of employees with diverse backgrounds, experiences and perspectives.

10.4 Departures from Recommendations

As it is listed on the ASX, the Company is required to report any departures from the Recommendations in its annual financial report.

The Company’s compliance and departures from the Recommendations will be announced to ASX prior to the Company’s re-instatement to trading.

11. MATERIAL CONTRACTS

As at the date of this Prospectus, our Company is not involved in any legal proceedings and the Directors are not aware of any legal proceedings pending or threatened against our Company.

11.1 Share Purchase Agreement

On 13 March 2014, the Company announced that it had entered into the Agreement with the Vendors to acquire 100% of the issued share capital of Digital CC, an unlisted Australian company.

Conditions Precedent

Completion of the Acquisition pursuant to the Agreement is conditional on the satisfaction or waiver of the following remaining conditions precedent (together the Conditions Precedent):

(a) the Company successfully completing the Offer;
(b) the Company undertaking a Consolidation of its existing capital;
(c) the Company and the Vendors obtaining all third party consents, approvals or waivers to the transaction;
(d) there being no material adverse change in respect of the Company and the Vendors; and
(e) the Company obtaining the conditional approval of ASX for reinstatement of its securities to quotation.

These remaining Conditions Precedent must be satisfied or waived by no later than 30 June 2014 (or any other date agreed in writing between the Company and the Vendors).

Consideration

If the Agreement is completed, in exchange for the Company acquiring 100% of the issued share capital in Digital CC, the Company will issue by way of consideration on a post-Consolidation basis, the following to the Vendors:

(a) 82,764,655 Shares (Consideration Shares);
(b) 24,950,130 performance rights, as follows:
(i) 16,633,420 performance rights which will vest on 1 July 2015 if the earnings before interest, tax, depreciation and amortisation in the Company in the period from 1 January 2014 to 30 June 2015 is $9,000,000 or greater (although no forecast is made of whether that earnings amount or any earnings amount will be received), on the terms set out in Section 12.6 (Class A Performance Rights); and
(ii) 8,316,710 performance rights which will vest on 1 July 2016 if the earnings before interest, tax, depreciation and amortisation in the Company in the period between 1 July 2015 and 30 June 2016 is $30,000,000 or greater (although no forecast is made of

whether that EBITDA or any EBITDA will be received), on the terms set out in Section 12.7 (Class B Performance Rights);

Performance Rights)

(ii) 8,316,710 unlisted options in the Company exercisable at $0.28 each expiring 2 years after completion of the Acquisition, on the terms set out in Section 12.3 (New Options),

(the Consideration Shares, Performance Rights and New Options are together the Vendor Consideration Securities).

The Vendor Consideration Securities are expected to be subject to escrow restrictions in accordance with Chapter 9 of the ASX Listing Rules.

Either party is entitled to a break fee of $150,000 where the other party fails to comply with their obligations to use all reasonable endeavours to ensure that each of the conditions precedent are satisfied.

The Agreement also contains a number of standard terms and conditions, including representations and warranties, considered standard for an agreement of this nature.

11.2 Existing Director agreements

Brett Lawrence - Executive Services Agreement

The Company entered into an Executive Services Agreement with Brett Lawrence and Leopard Energy Pty Ltd ACN 18 162 847 565 dated 1 April 2013, by which Brett Lawrence was appointed as Managing Director of the Company.

Remuneration for services is $180,000 per annum paid monthly in arrears. The termination notice period is 3 months. Upon termination, accrued leave is payable.

It is expected that following completion of the transaction and Mr Lawrence’s transition to a non-executive director of the Company that the terms of this arrangement will be amended as appropriate for his new role and consistent with the Company’s existing policy on payments to non-executive directors.

11.3 Proposed Director and management agreements

Digital CC has entered into employment agreements with its proposed Executive Chairman Mr Tsvetnenko, proposed Chief Executive Officer Mr Karis, proposed Chief Investment Officer Mr Brindise, proposed Chief Financial Officer Mr Laybourn and proposed Chief Technology Officer Mr Rodriguez on normal commercial terms and as summarised below.

It is proposed that the employment agreements will be assigned by Digital CC to the Company prior to the Company’s reinstatement to Official Quotation.

(a) Zhenya Tsvetnenko - Executive Employment Agreement

Under an Executive Employment Agreement entered into between Mr Tsvetnenko and Digital CC, Mr Tsvetnenko is appointed as Executive Chairman of Digital CC, with effect from the date of completion of the Acquisition (Employment). The Employment will be ongoing until it is terminated in accordance with Mr Tsvetnenko’s Executive Employment

Agreement. Mr Tsvetnenko’s Employment may be terminated by either party giving one (1) month written notice (although less than 1 month notice is required by Digital CC in certain circumstances such as Mr Tsvetnenko’s illness, absence, material breaches or misconduct in which case Mr Tsvetnenko will not be entitled to receive any termination payment in lieu or compensation as set out below).

Separately to payment to Mr Tsvetnenko for the period of notice, on termination of the engagement Mr Tsvetnenko’s termination payment will be calculated as follows, subject to any reduction necessary to ensure compliance with the Corporations Act, applicable ASX Listing Rules and other applicable legislation, regulations or regulatory rules:

(i) where the Employment is terminated within the first year of Employment and if Digital CC elects to make payment in lieu of notice, Digital CC must pay Mr Tsvetnenko a payment equal to his salary for the remainder of the notice period.
(ii) where the Employment is terminated between one and two years of Employment, Digital CC must pay Mr Tsvetnenko an amount equal to two years of his salary and an additional amount equal to the bonus(es) which Mr Tsvetnenko was entitled to during his Employment.
(iii) where the Employment is termination at any time after two years of the Employment, Digital CC must pay Mr Tsvetnenko an amount equal to three years of his salary and an additional amount equal to the bonus(es) which Mr Tsvetnenko was entitled to during his Employment.

Mr Tsvetnenko’s salary will be USD$400,000 per annum (inclusive of mandatory social security payments including superannuation) subject to annual salary reviews and his reasonable expenses will also be paid by the Company. Additionally, Mr Tsvetnenko will be eligible to participate in Digital CC’s bonus scheme to receive up to 30% of the bonus pool as determined by the Board of Digital CC, based on the success of Mr Tsvetnenko in achieving certain performance targets.

(b) Alex Karis - Executive Employment Agreement

Under an Executive Employment Agreement entered into between Mr Karis and Digital CC, Mr Karis is appointed as Chief Executive Officer of Digital CC, with effect from the date of completion of the Acquisition (Employment). The Employment will be ongoing until it is terminated in accordance with Mr Karis’ Executive Employment Agreement. The Employment may be terminated by either party giving one (1) month written notice (although less than 1 month notice is required by Digital CC in certain circumstances such as Mr Karis’ illness, absence, material breaches or misconduct in which case Mr Karis will not be entitled to receive any payment in lieu or compensation as set out below).

Separately to payment to Mr Karis for the period of notice, on termination of the Employment, Mr Karis will be entitled to termination payment calculated as follows, subject to any reduction necessary to ensure compliance with the Corporations Act, applicable ASX Listing Rules and other applicable legislation, regulations or regulatory rules:

(i) where the Employment is terminated within the first year of the Employment and if Digital CC elects to make payment in lieu of notice, Digital CC must pay Mr Karis a payment equal to his salary for the remainder of the notice period.
(ii) where the Employment is terminated between one and two years of the Employment, Digital CC must pay Mr Karis an amount equal to two years of his salary and an additional amount equal to the bonus(es) which Mr Karis was entitled to during his Employment.
(iii) where the Employment is termination at any time after two years of the Employment, Digital CC must pay Mr Karis an amount equal to three years of his salary and an additional amount equal to the bonus(es) which Mr Karis was entitled to during his Employment.

Mr Karis’ salary will be USD$375,000 per annum (inclusive of mandatory social security payments including superannuation) subject to annual salary reviews and his reasonable expenses will also be paid by the Company. Additionally, Mr Karis will be eligible to participate in Digital CC’s bonus scheme to receive up to 30% of the bonus pool as determined by the Board of Digital CC, based on the success of Mr Karis in achieving certain performance targets.

(c) William Brindise - Executive Employment Agreement

Under an Executive Employment Agreement entered into between Mr Brindise and Digital CC, Mr Brindise is appointed as Chief Investment Officer of Digital CC, with effect from the date of completion of the Acquisition (Employment). The Employment will be ongoing until it is terminated in accordance with Mr Brindise’ Executive Employment Agreement. The Employment may be terminated by either party giving three (3) months written notice (although less than 3 months notice is required by Digital CC in certain circumstances such as Mr Brindise’s illness, absence, material breaches or misconduct in which case Mr Brindise will not be entitled to receive any payment in lieu or compensation as set out below). On termination of the Employment and where Digital CC elects to make payment in lieu of notice, the Company must pay Mr Brindise a payment equal to his salary for the remainder of the notice period. Mr Brindise is will be under restraint and non solicitation clauses for up to 12 months after the termination of the Employment.

Mr Brindise’s salary will be USD$120,000 per annum (inclusive of mandatory social security payments including superannuation) subject to annual salary reviews and his reasonable expenses will also be paid by the Company. Additionally, Mr Brindise will be eligible to participate in Digital CC’s bonus scheme to receive up to 5% of the bonus pool as determined by the Board of Digital CC, based on the success of Mr Brindise in achieving certain performance targets. During the first year of the Employment, Mr Brindise may with consent of Digital CC, request drawing from Digital CC up to a maximum total aggregate amount of $130,000. For the avoidance of doubt Digital CC will have absolute discretion in determining whether the drawings can be paid.

(d) Mark Laybourn - Executive Employment Agreement

Under an Executive Employment Agreement dated 28 April 2014 entered into between Mr Laybourn and Digital CC, Mr Laybourn is appointed as Chief Financial Officer of Digital CC, with effect from the date of completion of the Acquisition (Employment). The Employment will be ongoing until it is terminated in accordance with Mr Laybourn’s Executive Employment Agreement. The Employment may be terminated by either party giving three (3) months written notice (although less than 3 months notice is required by Digital CC in certain circumstances such as Mr Laybourn’s illness, absence, material breaches or misconduct in which case Mr Laybourn will not be entitled to receive any payment in lieu or compensation as set out below). On termination of the Employment and where Digital CC elects to make payment in lieu of notice, the Company must pay Mr Laybourn a payment equal to his salary for the remainder of the notice period. Mr Laybourn is will be under restraint and non solicitation clauses for up to 24 months after the termination of the Employment.

Mr Laybourn’s salary will be USD$250,000 per annum (inclusive of mandatory social security payments including superannuation) subject to annual salary reviews and his reasonable expenses will also be paid by the company. Additionally, Mr Laybourn will be eligible to participate in Digital CC’s bonus scheme to receive up to 5% of the bonus pool as determined by the Board of Digital CC, based on the success of Mr Laybourn in achieving certain performance targets.

(e) Fabricio Rodriguez - Executive Employment Agreement

Under an Executive Employment Agreement dated 28 April 2014 entered into between Mr Rodriguez and Digital CC, Mr Rodriguez is appointed as Chief Technology Officer of Digital CC, with effect from the date of completion of the Acquisition (Employment). The Employment will be ongoing until it is terminated in accordance with Mr Rodriguez’ Executive Employment Agreement. The Employment may be terminated by either party giving three (3) months written notice (although less than 3 months notice is required by Digital CC in certain circumstances such as Mr Rodriguez’ illness, absence, material breaches or misconduct in which case Mr Rodriguez will not be entitled to receive any payment in lieu or compensation as set out below). On termination of the Employment and where Digital CC elects to make payment in lieu of notice, the Company must pay Mr Rodriguez a payment equal to his salary for the remainder of the notice period. Mr Rodriguez is will be under restraint and non solicitation clauses for up to 24 months after the termination of the Employment.

Mr Rodriguez’ salary will be USD$80,000 per annum (inclusive of mandatory social security payments including superannuation) subject to annual salary reviews and his reasonable expenses will also be paid by the Company. Additionally, Mr Rodriguez will be eligible to participate in Digital CC’s bonus scheme to receive up to 3% of the bonus pool as determined by the Board of Digital CC, based on the success of Mr Rodriguez in achieving certain performance targets.

Under all of the Executive Employment Agreements above, Digital CC, in its absolute discretion acting reasonably, can assign and transfer the Employments to any of Digital CC’s Related Bodies Corporate.

11.4 DJ Carmichael Mandate

Our Company has entered into a Mandate Agreement with DJ Carmichael Pty Ltd ACN 003 058 857 commencing 6 March 2014. The agreement relates solely to the Offer, ceases upon completion of the Offer and entitles DJ Carmichael to:

(a) a fee of 4% of funds raised in the Offer (excluding the $4,000,000 firm commitment from Messrs Rod Jones and Craig Burton); and
(b) 1,600,000 fully paid ordinary shares in the Company on a postconsolidation basis.

11.5 Loan Facility Agreement

The Company has agreed during April 2014 to provide an unsecured loan facility of up to $2,000,000 to Digital CC prior to completion of the Acquisition. These funds have now been provided to Digital CC. The loan facility will enable Digital CC to partially fund the obligations of Digital CC Management Pty Ltd under its contract with Bitfury (Malta) Limited pursuant to which contract Digital CC Management Pty Ltd acquired computer hardware equipment (as summarised in Section 11.8). The interest rate under the loan facility is 15% per annum.

The loan facility is on standard commercial and arm’s length terms and is repayable by Digital CC if the Acquisition does not proceed, within 3 months of the date that the Acquisition does not proceed, or on any other date agreed to by the Company and Digital CC in writing. The loan is also repayable upon a default by Digital CC and Digital CC has also given an indemnity to the Company.

The loan facility restricts Digital CC's ability to dispose of its material assets, create any encumbrances over any of its assets, be the creditor in respect of any loans and borrow any further funds except as required to repay the facility.

11.6 CloudHashing Agreement

Digital CC Management Pty Ltd has entered into a mining agreement with Technology IQ Limited, one of the Vendors, dated 17 March 2014.

Technology IQ Limited is a company based in the United Kingdom and trades under the name ‘CloudHashing’.

Under the CloudHashing Agreement, Digital CC Management Pty Ltd may, from time to time, enter into contracts with Technology IQ for the purchase of hashing power and the provision of hosting facilities. It is a term of the CloudHashing Agreement that CloudHashing is permitted to appoint Emmanuel Abiodun as a director of Digital CC Holdings Pty Ltd (and ultimately the Company). CloudHashing is entitled to receive a 3% for maintaining the mining equipment stored with CloudHashing on behalf of Digital CC as well as to receive a 25% margin on any Digital CC hardware stored with CloudHashing that is sold.

Digital CC is consistently evaluating the purchase of mining contracts and/or hosting services with Cloudhashing compared to purchasing hardware directly from manufacturers or hosting directly with data centres.

In addition, under the CloudHashing Agreement, Technology IQ Limited’s proprietary Bitcoin mining management software is proposed to be deployed onto Digital CC’s hardware – hosted in managed data centres currently located

in Iceland and Texas. Technology IQ Limited has agreed hosting facility arrangements with the data centres.

Further to the CloudHashing Agreement, Digital CC proposes to undertake Bitcoin trading activities for the account of Technology IQ Limited, through Digital CC’s existing trading operations. Digital CC’s established trading desk trades Bitcoins over multiple exchanges.

11.7 Acquisition of shares between Vendors

Magna Fortis Pty Ltd, entered into two separate Heads of Agreement with Technology IQ Limited in November 2013 to acquire a total of approximately 17% of the shares in Technology IQ Limited and to acquire one board nomination right for the board of Technology IQ Limited. It is anticipated that Zhenya Tsvetnenko may be entitled to fill that board position, subject to a formal agreement being signed. The formal documentation for the transfer of shares to Magna Fortis Pty Ltd is currently being negotiated. Magna Fortis Pty Ltd will not hold a controlling interest in Technology IQ following the transfer of shares to Magna Fortis Pty Ltd.

Mr Zhenya Tsvetnenko, one of the Proposed Directors, who controls one of the Vendors (Lydian Enterprises Pty Ltd) is the sole director of Magna Fortis Pty Ltd. Lydian Enterprises Pty Ltd is the sole shareholder of Magna Fortis Pty Ltd.

11.8 Bitfury Agreement

Digital CC Management Pty Ltd has entered into a Master Agreement with Bitfury (Malta) Limited (a company incorporated in Malta) dated 2 April 2014 (Bitfury Agreement).

Under the Bitfury Agreement, Digital CC Management Pty Ltd will, from time to time, enter into contracts with Bitfury (Malta) Limited for the purchase of computing hardware to be used for digital currency mining. The specification and pricing of that hardware will be negotiated on an order by order basis.

Bitfury (Malta) Limited is not a related party to the Vendors, Digital CC or the Company and the agreement was negotiated on arm’s-length commercial terms.

Under the agreement, Bitfury (Malta) Limited has agreed to provide to Digital CC Management Pty Ltd a warranty on all computing hardware (and the installed software) to ensure that the computing hardware and software performs in accordance with the specifications.

With exception to how the compensation is calculated in the event of delayed delivery or warranty claims, the agreement otherwise contains terms that are considered standard for an international agreement of this nature including in relation to warranties, default and termination.

11.9 Lease of Goods Agreement

Digital CC Trading Pty Ltd has entered into a Lease of Goods Agreement with Digital CC Management Pty Ltd dated 7 March 2014.

Under this agreement, Digital CC Management Pty Ltd has agreed to lease to Digital CC Trading Pty Ltd such hardware, equipment, contractual rights (including rights under mining agreements) and other goods as determined from time to time.

Pursuant to the agreement, Digital CC Trading Pty Ltd is obligated to pay Digital CC Management Pty Ltd a lease fee equal to that of market value payable annually in arrears.

The agreement otherwise contains terms that are considered standard for an agreement of this nature including in relation to termination, maintenance of the loaned equipment and registration rights.

11.10 Development Agreement

Digital CC IP Pty Ltd has entered into a Development Agreement with Mpire Media Pty Ltd (ACN 126 813 214) dated 7 March 2014.

Under this agreement Digital CC IP Pty Ltd will engage Mpire Media Pty Ltd to develop systems, content and branding on behalf of Digital CC IP Pty Ltd.

In addition, pursuant to the agreement, Digital CC IP Pty Ltd is obligated to pay Mpire Media Pty Ltd a development fee. This fee shall be agreed by the parties on a per job basis at the then applicable market rate for provision of the services (in Australia).

The Development Agreement otherwise contains terms that are considered standard for an agreement of this nature including standard rights to intellectual property developed under the agreement.

Zhenya Tsvetnenko, one of the Proposed Directors, is the sole director of Mpire Media Pty Ltd and by virtue of related entities is also the sole ultimate shareholder of Mpire Media Pty Ltd.

11.11 Intellectual Property Licence Agreement (Digital CC IP Pty Ltd – Digital CC Trading Pty Ltd)

Digital CC IP Pty Ltd has entered into an IP Licence Agreement with Digital CC Trading Pty Ltd dated 11 February 2014.

Under the agreement Digital CC IP Pty Ltd will licence the intellectual property it holds to Digital CC Trading Pty Ltd. The licence is not exclusive.

Pursuant to the agreement, Digital CC Trading Pty Ltd is obliged to pay a licence fee equal to the market value of the licence payable annually in arrears.

The agreement otherwise contains terms that are considered standard for an agreement of this nature including provisions to maintain ownership of all intellectual property in Digital CC IP Pty Ltd.

11.12 Intellectual Property Licence Agreement (Digital CC IP Pty Ltd – Digital CC Management Pty Ltd)

Digital CC IP Pty Ltd has entered into an IP Licence Agreement with Digital CC Management Pty Ltd dated 11 February 2014.

Under the agreement Digital CC IP Pty Ltd will licence the intellectual property it holds to Digital CC Management Pty Ltd. The licence is not exclusive.

Pursuant to the agreement, Digital CC Management Pty Ltd is obliged to pay a licence fee equal to the market value of the licence payable annually in arrears.

The agreement otherwise contains terms that are considered standard for an agreement of this nature including provisions to maintain ownership of all intellectual property in Digital CC IP Pty Ltd.

11.13 Intellectual Property Licence Agreement (Digital CC IP Pty Ltd – Digital CC IP Limited (incorporated in Hong Kong))

Digital CC IP Pty Ltd has entered into an IP Licence Agreement with Digital CC IP Limited (incorporated in Hong Kong) dated 11 February 2014.

Under the agreement Digital CC IP Pty Ltd will licence the intellectual property it holds to Digital CC IP Limited. The licence is not exclusive.

Pursuant to the agreement, Digital CC IP Limited is obliged to pay a licence fee equal to the market value of the licence payable annually in arrears.

The agreement otherwise contains terms that are considered standard for an agreement of this nature including provisions to maintain ownership of all intellectual property in Digital CC IP Pty Ltd.

11.14 Shareholders’ and Directors’ Loan Agreement

Digital CC has entered into a Shareholders’ and Directors’ Loan Agreement dated 7 March 2014 with Proposed Director William Brindise, Technology IQ Limited and NRB International LLC (two of the Vendors), Karis Holdings Inc (which is controlled by Proposed Director Alex Karis, who is also the controller of Digital Man LLC, another of the Vendors) and Magna Fortis Pty Ltd as lenders to Digital CC. Proposed Director Zhenya Tsvetnenko is the sole director of Magna Fortis Pty Ltd and Lydian Enterprises Pty Ltd ATF Lydian Trust is the sole shareholder of Magna Fortis Pty Ltd.

This agreement provides for the lenders to provide unsecured funding to Digital CC for it to continue with its activities prior to the completion of the back-door listing contemplated by the Acquisition Resolutions.

Pursuant to the agreement, Digital CC is obliged to pay interest on the loans at a rate calculated as 63% of any profits derived from the use of the loan funds until the loans are repaid in full. The loans are repayable by Digital CC in its discretion from the date of the agreement though must be repaid in full no later than the earlier of 6 months after the date of the agreement or completion of the Offer. It is proposed that these loans will be repaid by the time of the Offer (if they are not repaid in cash beforehand) such that no interest will be payable on those loans after the back-door listing is completed.

The agreement otherwise contains terms that are considered standard for an agreement of this nature including in relation to default rights except that in the event of default a single lender cannot itself commence recovery proceedings against Digital CC, requiring at least one other lender to join with them.

Each of the lenders are either directors or shareholders (or related entities of a director or shareholder) of the Vendors.

11.15 Deed of Variation of Shareholders’ and Directors’ Loan Agreement

Following the Shareholders’ and Directors’ Loan Agreement referred to above, some of the lenders assigned their debts to their related entities so that each of the creditors of the borrower (Digital CC) are now Vendors. Accordingly:

(a) on 17 March 2014 Karis Holdings Inc assigned its debt under the Shareholders’ and Directors’ Loan Agreement to its related entity Digital Man LLC;
(b) on 17 March 2014 William Brindise assigned his debt under the Shareholders’ and Directors’ Loan Agreement to his related entity NRB International LLC; and
(c) on 24 March 2014 Magna Fortis Pty Ltd assigned its debt under the Shareholders’ and Directors Loan Agreement to its related entity Lydian Enterprises Pty Ltd ATF Lydian Trust.

The borrower (Digital CC) requested and the lenders (now Lydian Enterprises Pty Ltd ATF Lydian Trust, Digital Man LLC, Technology IQ Limited and NRB International LLC, after assignments of the debts as noted above) agreed to provide, on demand, additional funds to the borrower. The Deed of Variation of Loan Agreement dated 24 March 2014 records the terms of the additional loans.

Pursuant to the Deed of Variation of Loan Agreement each of those lenders has agreed to lend to Digital CC additional funds up to a total loan cap.

The respective cap limits for each of those lenders (each of whom is a Vendor) of all aggregated principal loan amounts pursuant to the original Loan Agreement and the Deed of Variation, in Australian Dollars, are as follows:

(a) Lydian Enterprises Pty Ltd ATF Lydian Trust - $750,000;
(b) Digital Man LLC - $150,000;
(c) NRB International LLC - $235,675; and
(d) Technology IQ Limited - $200,000.

The funds loaned up to the cap amount are proposed to be repaid by way of converting the amounts outstanding during the Offer into Shares in the Company pursuant to the Offer for each of the lenders, at the deemed issue price of $0.20 of the principal amounts of the respective loans per Share. This conversion will be limited to Australian Dollars, and any additional loan funds over the conversion will be repaid in cash. For example, $20,328.37 in Australian Dollars will be repaid to Technology IQ Limited in cash.

Digital CC does, however, retain the right to repay those loans earlier in cash.

Refer to Section 4.8 for a further explanation of the conversion of debt to equity proposed to comprise part of the Offer.

The interest payable on the loaned amounts up to the caps remains unaffected by the Deed of Variation, and are proposed to be paid by way of lump sum cash payment out of funds raised from the Offer.

For any amounts loaned by any of the lenders in addition to the cap limits noted above (apart from the Facility Agreement – Digital CC and Lydian Enterprises Pty Ltd ATF Lydian Trust summarised in Section 11.16 below), those additional amounts will be repaid within 6 months after the date of advancement. Interest will accrue in one of two ways:

(a) with respect to monies loaned for the purpose of purchasing equipment or mining contracts, interest will be paid by way of an in specie transfer

of 5% of the hashing power that is attributable to the relevant equipment or mining agreement purchased (as the case may be). That hashing power will be credited and transferred to the lender immediately upon the equipment being commissioned or the mining agreement commencing (as the case may be);

(b) with respect to monies loaned for any other purpose other than that above, interest will accrue at 10% per annum calculated and payable monthly.

11.16 Facility Agreement – Digital CC and Lydian Enterprises Pty Ltd ATF Lydian Trust

By agreement dated 3 April 2014, a further unsecured loan facility has been advanced by Lydian Enterprises Pty Ltd ATF Lydian Trust to Digital CC, in the sum of up to $2,800,000, to fund the purchase by the Digital CC group of hardware and equipment from Bitfury (Malta) Limited during the period commencing on the date of the announcement of the transaction with the Company and the completion of the transaction and re-instatement to trading of the Company on ASX.

Interest under the loan advanced by Lydian Enterprises Pty Ltd ATF Lydian Trust is 15% of the principal outstanding, payable on the last day of each month until the borrowed funds are repaid in full. The principal of $2,800,000 and any outstanding interest is proposed to be repaid by a lump sum cash payment out of funds raised from the Offer (as disclosed in Section 4.9).

11.17 Trading Account Agreements

Digital CC Management Pty Ltd has entered into separate Trading Account Agreements with each of Alexander Karis (dated 6 March 2014) and William Brindise (each Proposed Directors and respectively controlling Vendors Digital Man LLC and NRB International LLC) and NRB International LLC (account holders) the latter two agreements being dated 7 March 2014.

Under the agreements the parties confirm that the trading exchange accounts (including the balances of those accounts, which contain cash and digital currency) held by each of the account holders are being held on trust for Digital CC Management Pty Ltd. In addition, pursuant to these agreements the parties confirm that each of the account holders are to only deal with the accounts at the direction of Digital CC Management Pty Ltd under a bare trust relationship.

These agreements otherwise contain terms that are considered standard for an agreement of this nature including in relation to rights to vest the trust and indemnities.

11.18 Trading Accounts Transfer Agreement

Digital CC Trading Pty Ltd has entered into a Trading Accounts Transfer Agreement with Digital CC Management Pty Ltd dated 7 March 2014.

This agreement follows in time to the Trading Account Agreements referred to above.

Pursuant to the Trading Accounts Transfer Agreement, Digital CC Management Pty Ltd will transfer the accounts the subject of the Trading Account Agreements (summarised above) (not including account balances) to Digital CC Trading Pty Ltd in consideration for the sum of US$1.00. The Trading Accounts Transfer Agreement also confirms that the account balances the subject of the accounts

will be held (and invested) on trust for the benefit of Digital CC Management Pty Ltd.

The Trading Accounts Transfer Agreement otherwise contains terms that are considered standard for an agreement of this nature including in relation to payment of the purchase price, indemnities and default.

11.19 Domain Transfer Agreement - Zhenya Tsvetnenko

Digital CC IP Pty Ltd has entered into a Domain Transfer Agreement with one of the Proposed Directors, Zhenya Tsvetnenko dated 7 March 2014.

Pursuant to the agreement, Zhenya Tsvetnenko will transfer the domain name www.bitcoin.com.au registered by Mr Tsvetnenko prior to the incorporation of Digital CC to Digital CC IP Pty Ltd.

11.20 Domain Transfer Agreement - Alexander Karis

Digital CC IP Pty Ltd has entered into a Domain Transfer Agreement with one of the Proposed Directors, Alexander Karis dated 6 March 2014.

Pursuant to the agreement, Alexander Karis will transfer eleven digitalbtc, digitalX and Bitcoin related domain names registered by Mr Karis prior to the incorporation of Digital CC to Digital CC IP Pty Ltd.

11.21 Line of Credit

Digital CC has entered into a line of credit agreement with Digital CC Management Pty Ltd dated 7 March 2014.

Pursuant to the agreement, Digital CC Holdings Pty Ltd will permit Digital CC Management Pty Ltd to borrow up to $10,000,000 by way of line of credit with same to be repaid on the expiration of 36 months or such later date as agreed between the parties.

There is no interest payable on this line of credit, the parties being members of the same company group.

The agreement otherwise contains terms that are considered standard for an agreement of this nature including default and termination provisions.

11.22 General Security Agreement

As security for the Line of Credit Agreement detailed above, Digital CC has entered into a General Security Agreement with Digital CC Management Pty Ltd dated 7 March 2014.

Pursuant to the agreement, Digital CC is entitled to register a charge against the assets of Digital CC Management Pty Ltd to secure repayment of the Line of Credit. This agreement also permits Digital CC to specifically charge any equipment purchased by Digital CC Management Pty Ltd.

The agreement otherwise contains terms that are considered standard for an agreement of this nature including rights of enforcement, default and termination.

12. ADDITIONAL INFORMATION

12.1 Litigation

As at the date of this Prospectus, our Company and Digital CC and the Digital Subsidiaries are not involved in any legal proceedings and the Directors are not aware of any legal proceedings pending or threatened against our Company.

12.2 Rights and liabilities attaching to Shares

The following is a summary of the more significant rights and liabilities attaching to Shares being offered pursuant to this Prospectus. This summary is not exhaustive and does not constitute a definitive statement of the rights and liabilities of Shareholders. To obtain such a statement, persons should seek independent legal advice.

Full details of the rights and liabilities attaching to Shares are set out in the Constitution, a copy of which is available for inspection at the Company’s registered office during normal business hours.

(a) General meetings

Shareholders are entitled to be present in person, or by proxy, attorney or representative to attend and vote at general meetings of the Company.

Shareholders may requisition meetings in accordance with section 249D of the Corporations Act and the Constitution of the Company.

(b) Voting rights

Subject to any rights or restrictions for the time being attached to any class or classes of shares, at general meetings of Shareholders or classes of shareholders:

(i) each Shareholder entitled to vote may vote in person or by proxy, attorney or representative;
(ii) on a show of hands, every person present who is a Shareholder or a proxy, attorney or representative of a Shareholder has one vote; and
(iii) on a poll, every person present who is a Shareholder or a proxy, attorney or representative of a Shareholder shall, in respect of each fully paid Share held by him, or in respect of which he is appointed a proxy, attorney or representative, have one vote for each Share held, but in respect of partly paid shares shall have such number of votes as bears the same proportion to the total of such Shares registered in the Shareholder’s name as the amount paid (not credited) bears to the total amounts paid and payable (excluding amounts credited).

(c) Dividend rights

Subject to the rights of any preference Shareholders and to the rights of the holders of any shares created or raised under any special arrangement as to dividend, the Directors may from time to time declare a dividend to be paid to the Shareholders entitled to the

dividend which shall be payable on all Shares according to the proportion that the amount paid (not credited) is of the total amounts paid and payable (excluding amounts credited) in respect of such Shares.

The Directors may from time to time pay to the Shareholders any interim dividends as they may determine. No dividend shall carry interest as against the Company. The Directors may set aside out of the profits of the Company any amounts that they may determine as reserves, to be applied at the discretion of the Directors, for any purpose for which the profits of the Company may be properly applied.

Subject to the ASX Listing Rules and the Corporations Act, the Company may, by resolution of the Directors, implement a dividend reinvestment plan on such terms and conditions as the Directors think fit.

(d) Winding-up

If the Company is wound up, the liquidator may, with the authority of a special resolution, divide among the shareholders in kind the whole or any part of the property of the Company, and may for that purpose set such value as he considers fair upon any property to be so divided, and may determine how the division is to be carried out as between the Shareholders or different classes of Shareholders.

(e) Shareholder liability

As the Shares under the Prospectus are fully paid shares, they will not be subject to any calls for money by the Directors and will therefore not become liable for forfeiture.

(f) Transfer of Shares

Generally, Shares in the Company are freely transferable, subject to formal requirements, the registration of the transfer not resulting in a contravention of or failure to observe the provisions of a law of Australia and the transfer not being in breach of the Corporations Act or the ASX Listing Rules.

(g) Future increase in capital

The issue of any new Shares is under the control of the Board of the Company as appointed from time to time. Subject to restrictions on the issue or grant of Securities contained in the ASX Listing Rules, the Constitution and the Corporations Act (and without affecting any special right previously conferred on the holder of an existing Share or class of shares), the Directors may issue Shares and other Securities as they shall, in their absolute discretion, determine.

(h) Variation of rights

Under Section 246B of the Corporations Act, the Company may, with the sanction of a special resolution passed at a meeting of Shareholders vary or abrogate the rights attaching to Shares.

If at any time the share capital is divided into different classes of shares, the rights attached to any class (unless otherwise provided by the terms of issue of the shares of that class) may be varied or abrogated with the

consent in writing of the holders of three quarters of the issued shares of that class, or if authorised by a special resolution passed at a separate meeting of the holders of the shares of that class.

(i)

Alteration of Constitution

In accordance with the Corporations Act, the Constitution can only be amended by a special resolution passed by at least three quarters of votes validly cast for Shares at the general meeting. In addition, at least 28 days written notice specifying the intention to propose the resolution as a special resolution must be given.

12.3 Terms and conditions of New Options

The terms and conditions of the New Options are set out below:

(a) Entitlement

Each New Option entitles the holder to subscribe for one Share upon exercise of the New Option.

(b) Exercise Price

Subject to paragraph (k), the amount payable upon exercise of each New Option will be $0.28 (Exercise Price).

(c) Expiry Date

Each New Option will expire at 5:00 pm (WST) on the date which falls two years after completion of the Acquisition (Expiry Date). A New Option not exercised before the Expiry Date will automatically lapse on the Expiry Date.

(d) Exercise Period

The New Options are exercisable at any time on or prior to the Expiry Date (Exercise Period).

(e) Notice of Exercise

The New Options may be exercised during the Exercise Period by notice in writing to the Company in the manner specified on the New Option certificate (Notice of Exercise) and payment of the Exercise Price for each New Option being exercised in Australian currency by electronic funds transfer or other means of payment acceptable to the Company.

(f) Exercise Date

A Notice of Exercise is only effective on and from the later of the date of receipt of the Notice of Exercise and the date of receipt of the payment of the Exercise Price for each New Option being exercised in cleared funds (Exercise Date).

(g) Timing of issue of Shares on exercise

Within 15 Business Days after the later of the following:

(i) the Exercise Date; and

(ii) when excluded information in respect to the Company (as defined in section 708A(7) of the Corporations Act) (if any) ceases to be excluded information,
(iii) but in any case no later than 20 Business Days after the Exercise Date, the Company will:
(iv) allot and issue the number of Shares required under these terms and conditions in respect of the number of New Options specified in the Notice of Exercise and for which cleared funds have been received by the Company;
(v) if required, give ASX a notice that complies with section 708A(5)(e) of the Corporations Act, or, if the Company is unable to issue such a notice, lodge with ASIC a prospectus prepared in accordance with the Corporations Act and do all such things necessary to satisfy section 708A(11) of the Corporations Act to ensure that an offer for sale of the Shares does not require disclosure to investors; and
(vi) if admitted to the official list of ASX at the time, apply for official quotation on ASX of Shares issued pursuant to the exercise of the Options.

If a notice delivered under (g)(v) for any reason is not effective to ensure that an offer for sale of the Shares does not require disclosure to investors, the Company must, no later than 20 Business Days after becoming aware of such notice being ineffective, lodge with ASIC a prospectus prepared in accordance with the Corporations Act and do all such things necessary to satisfy section 708A(11) of the Corporations Act to ensure that an offer for sale of the Shares does not require disclosure to investors.

(h) Shares issued on exercise

Shares issued on exercise of the New Options rank equally with the then issued fully paid ordinary shares of the Company.

(i) Quotation of Shares issued on exercise

If admitted to the official list of ASX at the time, application will be made by the Company to ASX for quotation of the Shares issued upon the exercise of the New Options.

(j) Unquoted

The Company will not apply for quotation of the New Options on ASX.

(k) Reconstruction of capital

If at any time the issued capital of the Company is reconstructed, all rights of an Optionholder are to be changed in a manner consistent with the Corporations Act and the ASX Listing Rules at the time of the reconstruction.

(l) Participation in new issues

There are no participation rights or entitlements inherent in the New Options and holders will not be entitled to participate in new issues of capital offered to Shareholders during the currency of the New Options without exercising the New Options.

(m) Change in exercise price

Subject to paragraph (k) a New Option does not confer the right to a change in Exercise Price or a change in the number of underlying securities over which the New Option can be exercised.

(n) Transferability

The New Options are transferable subject to any restriction or escrow arrangements imposed by ASX or under applicable Australian securities laws.

12.4 Terms and conditions of existing Options

As described in Section 4.11, the Company currently has 16,000,000 Options on issue which are each exercisable at $0.05 each on or before 30 June 2017 (on a pre-Consolidation basis).

On a post-Consolidation basis, these Options will be reconstructed to 2,799,649 Options.

The terms and conditions of the existing Options on a post-Consolidation basis are set out below:

(a) Entitlement

Each Option entitles the Optionholder to subscribe for one Share upon exercise of the Option.

(b) Exercise Price

Subject to paragraph(k), the amount payable upon exercise of each Option will be $0.286 (Exercise Price).

(c) Expiry Date

Each Option will expire at 5:00 pm (WST) on 30 June 2017 (Expiry Date). An Option not exercised before the Expiry Date will automatically lapse on the Expiry Date.

(d) Exercise Period

Options are exercisable at any time on or prior to the Expiry Date (Exercise Period).

(e) Notice of Exercise

The Options may be exercised during the Exercise Period by notice in writing to the Company in the manner specified on the Option certificate (Notice of Exercise) and payment of the Exercise Price for each Option being exercised in Australian currency by electronic funds transfer or other means of payment acceptable to the Company.

(f)

Exercise Date

A Notice of Exercise is only effective on and from the later of the date of receipt of the Notice of Exercise and the date of receipt of the payment of the Exercise Price for each Option being exercised in cleared funds (Exercise Date).

(g) Timing of issue of Shares on exercise

Within 15 Business Days after the later of the following:

(i) the Exercise Date; and
(ii) when excluded information in respect to the Company (as defined in section 708A(7) of the Corporations Act) (if any) ceases to be excluded information,

but in any case no later than 20 Business Days after the Exercise Date, the Company will:

(iii) allot and issue the number of Shares required under these terms and conditions in respect of the number of New Options specified in the Notice of Exercise and for which cleared funds have been received by the Company;
(iv) if required, give ASX a notice that complies with section 708A(5)(e) of the Corporations Act, or, if the Company is unable to issue such a notice, lodge with ASIC a prospectus prepared in accordance with the Corporations Act and do all such things necessary to satisfy section 708A(11) of the Corporations Act to ensure that an offer for sale of the Shares does not require disclosure to investors; and
(v) if admitted to the official list of ASX at the time, apply for official quotation on ASX of Shares issued pursuant to the exercise of the Options.

If a notice delivered under (g)(iv) for any reason is not effective to ensure that an offer for sale of the Shares does not require disclosure to investors, the Company must, no later than 20 Business Days after becoming aware of such notice being ineffective, lodge with ASIC a prospectus prepared in accordance with the Corporations Act and do all such things necessary to satisfy section 708A(11) of the Corporations Act to ensure that an offer for sale of the Shares does not require disclosure to investors.

(h) Shares issued on exercise

Shares issued on exercise of the Options rank equally with the then issued fully paid ordinary shares of the Company.

(i) Quotation of Shares issued on exercise

If admitted to the official list of ASX at the time, application will be made by the Company to ASX for quotation of the Shares issued upon the exercise of the Options.

(j) Unquoted

The Company will not apply for quotation of the Options on ASX.

(k) Reconstruction of capital

(l) Participation in new issues

There are no participation rights or entitlements inherent in the Options and holders will not be entitled to participate in new issues of capital offered to Shareholders during the currency of the Options without exercising the Options.

(m) Change in exercise price

Subject to paragraph (k) an Option does not confer the right to a change in Exercise Price or a change in the number of underlying securities over which the Option can be exercised.

(n) Transferability

Options are transferable subject to any restriction or escrow arrangements imposed by ASX or under applicable Australian securities laws.

12.5 Terms and conditions of Options to be issued to Sibella Capital Pty Ltd in consideration for services to the Company

Resolution 8 considered at the General Meeting was approved by Shareholders permitting the Company to issue 6,000,000 Options (on a pre-Consolidation basis) to a service provider of the Company, Sibella Capital Pty Ltd ACN 108 289 818 for corporate and management and financial advisory services provided to the Company. Sibella Capital Pty Ltd is not a related party of the Company. The issue of those Options is unrelated to the Acquisition and the Acquisition Resolutions.

On a post-Consolidation basis, those Options will be reconstructed to 1,049,868 Options.

The terms and conditions of those Options on a post-Consolidation basis are set out below:

(a) Entitlement

Each Option entitles the holder to subscribe for one Share upon exercise of the Option.

(b) Exercise Price

Subject to paragraph(k), the amount payable upon exercise of each Option will be $0.286 (Exercise Price).

(c)

Expiry Date

Each Option will expire at 5:00 pm (WST) on 30 June 2017 (Expiry Date). A Option not exercised before the Expiry Date will automatically lapse on the Expiry Date.

(d) Exercise Period

The Options are exercisable at any time on or prior to the Expiry Date (Exercise Period).

(e) Notice of Exercise

(f) Exercise Date

(g) Timing of issue of Shares on exercise

Within 15 Business Days after the later of the following:

(i) the Exercise Date; and
(ii) when excluded information in respect to the Company (as defined in section 708A(7) of the Corporations Act) (if any) ceases to be excluded information,

but in any case no later than 20 Business Days after the Exercise Date, the Company will:

(iii) allot and issue the number of Shares required under these terms and conditions in respect of the number of New Options specified in the Notice of Exercise and for which cleared funds have been received by the Company;
(iv) if required, give ASX a notice that complies with section 708A(5)(e) of the Corporations Act, or, if the Company is unable to issue such a notice, lodge with ASIC a prospectus prepared in accordance with the Corporations Act and do all such things necessary to satisfy section 708A(11) of the Corporations Act to ensure that an offer for sale of the Shares does not require disclosure to investors; and

(v) if admitted to the official list of ASX at the time, apply for official quotation on ASX of Shares issued pursuant to the exercise of the Options.

(h) Shares issued on exercise

Shares issued on exercise of the Options rank equally with the then issued fully paid ordinary shares of the Company.

(i) Quotation of Shares issued on exercise

If admitted to the official list of ASX at the time, application will be made by the Company to ASX for quotation of the Shares issued upon the exercise of the Options.

(j) Unquoted

The Company will not apply for quotation of the Options on ASX.

(k) Reconstruction of capital

(l) Participation in new issues

(m) Change in exercise price

Subject to paragraph (k) a Option does not confer the right to a change in Exercise Price or a change in the number of underlying securities over which the Option can be exercised.

(n) Transferability

The Options are transferable subject to any restriction or escrow arrangements imposed by ASX or under applicable Australian securities laws.

12.6 Terms and conditions of Class A Performance Rights

The terms and conditions of the Class A Performance Rights are set out below:

(a) Subject to the satisfaction of the vesting condition set out in paragraph(b), each Performance Right vests to one Share.
(b) The Performance Rights will vest on 1 July 2015 if the earnings before interest, tax, depreciation and amortisation in the Company's consolidated group existing as at the date of issue of the Performance Rights (Group) earned from:
(i) direct and indirect mining, trading, futures trading, arbitrage, market making and investing in digital currencies (including but not limited to Bitcoin); and
(ii) digital currency products and services and software and consumer businesses relating to digital currencies (including but not limited to Bitcoin); or
(iii) any other business developed by the Group related to or deriving from the activities outlined in (i) and (ii) above,

in the period from 1 January 2014 to 30 June 2015 (inclusive of both dates) is $9,000,000 or greater (Vesting Condition).

(c) Upon:
(i) a takeover bid under Chapter 6 of the Corporations Act having been made in respect of the Company and:
- (A) having received acceptances for not less than 50.1% of the Company’s shares on issue; and
- (B) been declared unconditional by the bidder; or
(ii) a Court granting orders approving a compromise or arrangement for the purposes of or in connection with a scheme of arrangement for the reconstruction of the Company or its amalgamation with any other company or companies,

then, to the extent the Performance Rights have not vested due to satisfaction of the Vesting Condition, the Performance Rights automatically vest to that number of Shares which when issued together with all Shares issued under any other class of Performance Rights then on issue, is equal to the lesser of one Share per Performance Right and 10% of the total Shares on issue in the Company at that time. Performance Rights that are not vested and converted into Shares will continue to be held by the holder on the same terms and conditions.

(d) The Performance Rights shall expire and lapse in the event that the Company determines and gives written notice to the holder of the Performance Rights (in the absence of manifest error) that the Vesting Condition has not been satisfied.
(e) The Performance Rights will be issued for nil cash consideration and no consideration will be payable upon the vesting of the Performance Rights into Shares on the satisfaction of the Vesting Condition.
(f) Immediately following the satisfaction of the Vesting Condition the Company shall give written notice of that event to the holder of the Performance Rights that have vested and shall, unless otherwise

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directed by the holder, allot and issue the associated number of Shares within 10 Business Days (meaning Monday to Friday inclusive, except New Year’s Day, Good Friday, Easter Monday, Christmas Day, Boxing Day, and any other day that ASX declares is not a business day) of the date of that notice.

(g) The Company will not apply for quotation of the Performance Rights on ASX. However, the Company will apply for quotation of all Shares allotted and issued pursuant to the vesting of Performance Rights on ASX within 10 Business Days after the date of allotment and issue of those Shares and in any event, in compliance with the ASX Listing Rules.
(h) All Shares allotted and issued upon the vesting of Performance Rights will upon allotment and issue rank pari passu in all respects with other Shares.
(i) The Performance Rights are not transferable.
(j) In the event of any reorganisation (including consolidation, subdivision, reduction or return) of the issued capital of the Company, the terms of the Performance Rights will be adjusted in the manner determined by the Board to ensure that no advantage or disadvantage accrues to the holder as a result of such corporate actions and in any event in a manner consistent with the Corporations Act and the ASX Listing Rules at the time of the reorganisation.
(k) Subject to paragraph (j), there are no participating rights or entitlements inherent in the Performance Rights and holders will not be entitled to participate in new issues of capital offered to Shareholders during the currency of the Performance Rights unless the Vesting Condition has been satisfied or the Performance Rights have vested pursuant to paragraph (c) and the relevant Shares have been issued prior to the record date for determining entitlements. However, the Company will give notice to the holders of any new issues of capital prior to the record date for determining entitlements.
(l) A Performance Right does not confer the right to vote or receive dividends.

12.7 Terms and conditions of Class B Performance Rights

The terms and conditions of the Class B Performance Rights are set out below:

(a) Subject to the satisfaction of the vesting condition set out in paragraph (b), each Performance Right vests to one Share.
(b) The Performance Rights will vest on 1 July 2016 if the earnings before interest, tax, depreciation and amortisation in the Company's consolidated group existing as at the date of issue of the Performance Rights (Group) earned from:
(i) direct and indirect mining, trading, futures trading, arbitrage, market making and investing in digital currencies (including but not limited to Bitcoin); and
(ii) digital currency products and services and software and consumer businesses relating to digital currencies (including but not limited to Bitcoin); or

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(iii) any other business developed by the Group related to or deriving from the activities outlined in (i) and (ii) above,

in the period from 1 July 2015 to 30 June 2016 (inclusive of both dates) is $30,000,000 or greater (Vesting Condition).

Upon:

(i) a takeover bid under Chapter 6 of the Corporations Act having been made in respect of the Company and:
(A) having received acceptances for not less than 50.1% of the Company’s shares on issue; and
(B) been declared unconditional by the bidder; or
(ii) a Court granting orders approving a compromise or arrangement for the purposes of or in connection with a scheme for the reconstruction of the Company or its amalgamation with any other company or companies,

(d) The Performance Rights shall expire and lapse in the event that the Company determines and gives written notice to the holder of the Performance Rights (in the absence of manifest error) that the Vesting Condition has not been satisfied.
(e) The Performance Rights will be issued for nil cash consideration and no consideration will be payable upon the vesting of the Performance Rights into Shares on the satisfaction of the Vesting Condition.
(f) Immediately following the satisfaction of the Vesting Condition the Company shall give written notice of that event to the holder of the Performance Rights that have vested and shall, unless otherwise directed by the holder, allot and issue the associated number of Shares within 10 Business Days of the date of that notice.
(g) The Company will not apply for quotation of the Performance Rights on ASX. However, the Company will apply for quotation of all Shares allotted and issued pursuant to the vesting of Performance Rights on ASX within 10 Business Days after the date of allotment and issue of those Shares and in any event, in compliance with the ASX Listing Rules.
(h) All Shares allotted and issued upon the vesting of Performance Rights will upon allotment and issue rank pari passu in all respects with other Shares.
(i) The Performance Rights are not transferable.

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(j) In the event of any reorganisation (including consolidation, subdivision, reduction or return) of the issued capital of the Company, the terms of the Performance Rights will be adjusted in the manner determined by the Board to ensure that no advantage or disadvantage accrues to the holder as a result of such corporate actions and in any event in a manner consistent with the Corporations Act and the ASX Listing Rules at the time of the reorganisation.
(k) Subject to paragraph (j), there are no participating rights or entitlements inherent in the Performance Rights and holders will not be entitled to participate in new issues of capital offered to Shareholders during the currency of the Performance Rights unless the Vesting Condition has been satisfied or the Performance Rights have vested pursuant to paragraph (c) and the relevant Shares have been issued prior to the record date for determining entitlements. However, the Company will give notice to the holders of any new issues of capital prior to the record date for determining entitlements.
(l) A Performance Right does not confer the right to vote or receive dividends.

12.8 Interests of Directors and Proposed Directors

Other than as set out in this Prospectus, no Director or Proposed Director holds, or has held within the 2 years preceding lodgement of this Prospectus with the ASIC, any interest in:

(a) the formation or promotion of the Company;
(b) any property acquired or proposed to be acquired by the Company in connection with:
(i) its formation or promotion; or
(ii) the Offer; or
(c) the Offer,

and no amounts have been paid or agreed to be paid and no benefits have been given or agreed to be given to a Director or proposed Director:

(a) as an inducement to become, or to qualify as, a Director; or
(b) for services provided in connection with:
(i) the formation or promotion of the Company; or
(ii) the Offer.

12.9 Interests of Experts and Advisers

Other than as set out below or elsewhere in this Prospectus, no:

(a) person named in this Prospectus as performing a function in a professional, advisory or other capacity in connection with the preparation or distribution of this Prospectus;
(b) promoter of the Company; or

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(c) underwriter (but not a sub-underwriter) to the issue or a financial services licensee named in this Prospectus as a financial services licensee involved in the issue,

holds, or has held within the 2 years preceding lodgement of this Prospectus with the ASIC, any interest in:

(a) the formation or promotion of the Company;
(b) any property acquired or proposed to be acquired by the Company in connection with:
(i) its formation or promotion; or
(ii) the Offer; or
(c) the Offer,

and no amounts have been paid or agreed to be paid and no benefits have been given or agreed to be given to any of these persons for services provided in connection with:

(a) the formation or promotion of the Company; or
(b) the Offer.

Deloitte Corporate Finance Pty Limited has acted as Investigating Accountant and has prepared the Investigating Accountant’s Report which is included in Section 8 of this Prospectus. The Company estimates it will pay Deloitte Corporate Finance Pty Limited a total of $14,000 (excluding GST) for these services. During the 24 months preceding lodgement of this Prospectus with the ASIC, Deloitte Corporate Finance Pty Limited has received $88,358 from the Company for audit services.

Clayton Utz has acted as the solicitors to the Company in relation to the Offer. The Company estimates it will pay Clayton Utz $250,000 (excluding GST) for these services. During the 24 months preceding lodgement of this Prospectus with the ASIC, Clayton Utz has not received any other fees from the Company.

Steinepreis Paganin has acted as the solicitors to Digital CC in relation to the Offer. Digital CC expects that it will pay Steinepreis Paganin $200,000 (excluding GST) for these services. Subsequently, fees will be charged in accordance with normal charge out rates. During the 24 months preceding lodgement of this Prospectus with the ASIC, Steinepreis Paganin has acted for the Company and has received $61,983 fees from the Company for legal services provided to the Company.

DJ Carmichael has acted as the sole bookrunner to the Offer. The Company estimates it will pay DJ Carmichael $204,000 (excluding GST) for these services. During the 24 months preceding lodgement of this Prospectus with the ASIC, DJ Carmichael has not received any other fees from the Company.

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12.10 Consents

Each of the parties referred to in this Section:

(a) does not make, or purport to make, any statement in this Prospectus other than those referred to in this Section; and
(b) to the maximum extent permitted by law, expressly disclaim and take no responsibility for any part of this Prospectus other than a reference to its name and a statement included in this Prospectus with the consent of that party as specified in this Section.

Deloitte Corporate Finance has given its written consent to being named as Investigating Accountant in this Prospectus and to the inclusion of the Investigating Accountant’s Report in Section 8 of this Prospectus in the form and context in which the information and report is included. Deloitte Corporate Finance has not withdrawn its consent prior to lodgement of this Prospectus with the ASIC.

Clayton Utz has given its written consent to being named as the solicitors to the Company in this Prospectus. Clayton Utz has not been involved in the preparation of this Prospectus. Clayton Utz has not withdrawn its consent prior to the lodgement of this Prospectus with the ASIC.

Steinepreis Paganin has given its written consent to being named as the solicitors to Digital CC in this Prospectus. Steinepreis Paganin has not withdrawn its consent prior to the lodgement of this Prospectus with the ASIC.

HHG Legal Group has given its written consent to being named as the solicitors to Digital CC in this Prospectus. HHG has not been involved in the preparation of this Prospectus. HHG Legal Group has not withdrawn its consent prior to the lodgement of this Prospectus with the ASIC.

Computershare Investor Services Pty Limited has given its written consent to being named as the share registry to the Company in this Prospectus. Computershare Investor Services Pty Limited has not been involved in the preparation of this Prospectus. Computershare Investor Services Pty Limited has not withdrawn its consent prior to the lodgement of this Prospectus with the ASIC.

DJ Carmichael has given its written consent to being named as the sole bookrunner to the Offer in this Prospectus. DJ Carmichael has not withdrawn its consent prior to the lodgement of this Prospectus with the ASIC.

The Proposed Directors have each given their written consent to being named as the proposed directors of the Company and to all other information relevant to them in this Prospectus. The Proposed Directors have not withdrawn their consents prior to the lodgement of this Prospectus with the ASIC.

12.11 Expenses of the Offer

The total expenses of the Offer (excluding GST) are estimated to be approximately $775,984 and are expected to be applied towards the items set out in the table below:

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Item of Expenditure ASIC fees ASX fees Broker Commissions and other fees Legal, Accounting and Due Diligence Expenses Printing and Distribution Miscellaneous TOTAL	Full Subscription ($) 2,225 81,984 204,000 464,000 15,000 8,775
	775,984

12.12 Continuous disclosure obligations

As the Company is admitted to ASX’s Official List, the Company is a “disclosing entity” (as defined in Section 111AC of the Corporations Act) and, as such, will be subject to regular reporting and disclosure obligations. Specifically, like all listed companies, the Company is required to continuously disclose any information it has to the market which a reasonable person would expect to have a material effect on the price or the value of the Company’s securities.

Price sensitive information is publicly released through ASX before it is disclosed to shareholders and market participants. Distribution of other information to shareholders and market participants is also managed through disclosure to the ASX. In addition, the Company posts this information on its website after the ASX confirms an announcement has been made, with the aim of making the information readily accessible to the widest audience.

12.13 Electronic Prospectus

If you have received this Prospectus as an electronic Prospectus, please ensure that you have received the entire Prospectus accompanied by the Application Form and fully read those documents. If you have not, please contact the Company and the Company will send you, for free, either a hard copy or a further electronic copy of this Prospectus or both. Alternatively, you may obtain a copy of this Prospectus from the website of the Company at www.macroenergyltd.com.au.

The Corporations Act prohibits any person from passing on to another person the Application Form unless it is attached to or accompanies a hard copy of the Prospectus or a complete and unaltered electronic copy of this Prospectus. The Company reserves the right not to accept an Application Form from a person if it has reason to believe that when that person was given access to the electronic Application Form, it was not provided together with the electronic Prospectus and any relevant supplementary or replacement prospectus or any of those documents were incomplete or altered.

12.14 Financial Forecasts

The Directors have considered the matters set out in ASIC Regulatory Guide 170 and believe that they do not have a reasonable basis to forecast future earnings on the basis that the operations of the Company are inherently uncertain. Accordingly, any forecast or projection information would contain such a broad

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range of potential outcomes and possibilities that it is not possible to prepare a reliable best estimate forecast or projection.

12.15 Clearing House Electronic Sub-Register System (CHESS) and Issuer Sponsorship

The Company will apply to participate in CHESS, for those investors who have, or wish to have, a sponsoring stockbroker. Investors who do not wish to participate through CHESS will be issuer sponsored by the Company.

Electronic sub-registers mean that the Company will not be issuing certificates to investors. Instead, investors will be provided with statements (similar to a bank account statement) that set out the number of Shares issued to them under this Prospectus. The notice will also advise holders of their Holder Identification Number or Security Holder Reference Number and explain, for future reference, the sale and purchase procedures under CHESS and issuer sponsorship.

Electronic sub-registers also mean ownership of securities can be transferred without having to rely upon paper documentation. Further monthly statements will be provided to holders if there have been any changes in their security holding in the Company during the preceding month.

12.16 Privacy statement

If you complete an Application Form, you will be providing personal information to the Company. The Company collects, holds and will use that information to assess your application, service your needs as a Shareholder and to facilitate distribution payments and corporate communications to you as a Shareholder and carry out administration.

The information may also be used from time to time and disclosed to persons inspecting the register, including bidders for your securities in the context of takeovers, regulatory bodies including the Australian Taxation Office, authorised securities brokers, print service providers, mail houses and the share registry.

You can access, correct and update the personal information that we hold about you. If you wish to do so, please contact the share registry at the relevant contact number set out in this Prospectus.

Collection, maintenance and disclosure of certain personal information is governed by legislation including the Privacy Act 1988 (as amended), the Corporations Act and certain rules such as the ASX Settlement Operating Rules. You should note that if you do not provide the information required on the application for Shares, the Company may not be able to accept or process your application.

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13. DIRECTORS’ AUTHORISATION

This Prospectus is issued by the Company and its issue has been authorised by a resolution of the Directors.

In accordance with Section 720 of the Corporations Act, each Director has consented to the lodgement of this Prospectus with the ASIC.

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Brett Lawrence Managing Director For and on behalf of MACRO ENERGY LTD

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14. GLOSSARY

Where the following terms are used in this Prospectus they have the following meanings:

$ means an Australian dollar.

Acquisition has the meaning given to that term in Section 4.5.

Acquisition Resolutions means resolutions numbered 1-6 inclusive which related to approval of the Acquisition, the Offer and related matters, which resolutions were all approved by the Company’s Shareholders at the General Meeting.

Agreement means the share purchase agreement entered into between the Company and the shareholders of Digital CC (the Vendors) in respect of the acquisition of Digital CC, the material terms of which are summarised in Section 11.1.

Application Form means the application form attached to or accompanying this Prospectus relating to the Offer.

ASIC means Australian Securities & Investments Commission.

ASX means ASX Limited (ACN 008 624 691) or the financial market operated by it as the context requires.

ASX Listing Rules or Listing Rules means the official listing rules of ASX.

Bitcoin means the peer-to-peer payment system and the digital currency of the same name which uses open source cryptography to control the creation and transfer of such currency.

Bitfury Agreement has the meaning given in Section 11.8.

Block has the meaning given in Section 6.4.

Blockchain has the meaning given in Section 6.4.

Board means the board of Directors as constituted from time to time.

Bonus Pool has the meaning given to that term in Section 4.19.

Business Day means Monday to Friday inclusive, except New Year’s Day, Good Friday, Easter Monday, Christmas Day, Boxing Day, and any other day that ASX declares is not a business day.

Class A Performance Rights means performance rights to be granted on the terms set out in Section 12.6 by the Company to comprise part of the Vendor Consideration Securities being the consideration for the Company to acquire 100% of the shares in Digital CC pursuant to the Acquisition.

Class B Performance Rights means performance rights to be granted on the terms set out in Section 12.7 by the Company to comprise part of the Vendor Consideration Securities being the consideration for the Company to acquire 100% of the shares in Digital CC pursuant to the Acquisition.

Closing Date means the closing date of the Offer as set out in the indicative timetable in the Investment Overview in Section 3 of this Prospectus (subject to

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the Company reserving the right to extend the Closing Date or close the Offer, and the offer of Vendor Consideration Securities, early).

CloudHashing Agreement means the agreement between Digital CC Management Pty Ltd and one of the Vendors, Technology IQ Limited (also known as CloudHashing), summarised in Section 11.6.

Company means Macro Energy Ltd (ABN 59 009 575 035) (to be renamed “Digital CC Limited”).

Conditions Precedent means the conditions precedent to completion of the Agreement, as summarised in Section 11.1.

Consideration Shares has the meaning given to that term in Section 11.1.

Consolidation means the Company’s proposal to consolidate the issued capital of the Company on the basis that every 5.715 Securities are consolidated into 1 Security (as approved at the General Meeting).

Constitution means the constitution of the Company.

Corporations Act means the Corporations Act 2001 (Cth).

Digital CC means Digital CC Holdings Pty Ltd (ACN 167 754 725) and unless the context requires, includes the Digital Subsidiaries.

Digital CC IP Limited means Digital CC IP Limited a company incorporated in Hong Kong, (Cert. No. 626 550 8-000-01-14-6), a wholly owned subsidiary of Digital CC.

Digital CC IP Pty Ltd means Digital CC IP Ltd (ACN 167 755 080), a wholly owned subsidiary of Digital CC.

Digital CC Limited means Digital CC Limited a company incorporated in Hong Kong, (Cert. No. 624 529 90-000-12-13-4), a wholly owned subsidiary of Digital CC.

Digital CC Management Pty Ltd means Digital CC Management Pty Ltd (ACN 168 145 300), a wholly owned subsidiary of Digital CC.

Digital CC Trading Pty Ltd means Digital CC Trading Pty Ltd (ACN 167 755 099), the subsidiaries of Digital CC, being a wholly owned subsidiary of Digital CC.

Digital Subsidiaries means all of Digital CC IP Limited, Digital CC IP Pty Ltd, Digital CC Limited, Digital CC Management Pty Ltd, Digital CC Trading Pty Ltd, Digital CC USA Holding Inc, Digital CC USA Services LLC, and Digital CC USA LLC.

Directors means the directors of the Company at the date of this Prospectus.

DJ Carmichael means DJ Carmichael Pty Limited ACN 003 058 857, the sole bookrunner to the Offer.

FY performance goal has the meaning given to that term in Section 4.19.

General Meeting means the meeting of Shareholders held on 9 May 2014 at which all resolutions were approved, including the Acquisition Resolutions.

Hashing Power has the meaning given to that term in Section 6.6.

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New Options means unlisted Options in the Company exercisable at $0.28 each expiring 2 years after completion of the Acquisition, on the terms as it set out in Section 12.10.

Offer means the pursuant to this Prospectus, as set out in Section 5, of 45,500,000 Shares at an issue price of $0.20 per Share to raise $9,100,000 (up to $1,335,675 of which may be cash or alternatively non-cash consideration in satisfaction of loan principal repayment obligations of Digital CC to the Vendors other than West Coast Coin Holdings LLC).

Official List means the official list of ASX.

Official Quotation means official quotation by ASX in accordance with the ASX Listing Rules.

Option means an option to acquire a Share.

Optionholder means a holder of an Option.

Performance Right means a Class A Performance Right or a Class B Performance Right.

Proposed Directors means the four nominees of Digital CC who will be casually appointed to the Board of the Company upon completion of the Acquisition. The proposed directors are Eugeni ‘Zhenya’ Tsvetnenko, Alex Karis, William Brindise and Adeniyi ‘Emmanuel’ Olalekan Abiodun.

Prospectus means this prospectus.

Section means a section of this Prospectus.

Security means a security issued or to be issued in the capital of the Company, including a Share, Performance Right or an Option.

Share means a fully paid ordinary share in the capital of the Company.

Shareholder means a holder of Shares.

Vendor Consideration Securities means the following Securities comprising (on a post-Consolidation basis) the consideration for all shares in Digital CC pursuant to the Agreement (as summarised in Section 11.1 (although the Performance Rights are not offered pursuant to this Prospectus):

(a) 82,764,655 Shares;

(b) 24,950,130 Performance Rights, as follows:

(i) 16,633,420 Class A Performance Rights; and (ii) 8,316,710 Class B Performance Rights; and

Vendors means the current shareholders of Digital CC, comprising:

(a) Lydian Enterprises Pty Ltd ACN 139 802 921 ATF Lydian Trust, which holds 46.82% of the shares in Digital CC;

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(b) Digital Man LLC (company number 5445919, incorporated in Delaware) which holds 23.88% of the shares in Digital CC;
(c) NRB International LLC (company number 5443896, incorporated in Delaware) which holds 13.8% of the shares in Digital CC;
(d) Technology IQ Limited, which trades under the name ‘CloudHashing’, (company number 08418155, incorporated in the United Kingdom) which holds 15.00% of the shares in Digital CC; and
(e) West Coast Coin Holdings LLC (company number 5495047 incorporated in Delaware) which holds 0.5% of the shares in Digital CC.

WST means Western Standard Time as observed in Perth, Western Australia.

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AI assistant

DIGITALX LIMITED — Capital/Financing Update 2014

64762_rns_2014-05-11_76d9117c-37a9-4792-b144-b68fce265e74.pdf

MACRO ENERGY LTD (TO BE RENAMED ‘DIGITAL CC LIMITED’) ABN 59 009 575 035

PROSPECTUS

IMPORTANT INFORMATION

The Securities offered by this Prospectus should be considered highly speculative.

TABLE OF CONTENTS

INDICATIVE TIMETABLE*

1. CORPORATE DIRECTORY

Directors

Registered Office

Share Registry*

Proposed Directors

Investigating Accountant and Auditor

Solicitors to the Company

Company Secretary

Proposed ASX Code

Solicitors to Digital CC

2. IMPORTANT NOTICE

2.1 Website – Electronic Prospectus

2.2 Website

2.3 Forwarding-looking statements

2.4 Photographs and Diagrams

2.5 Conditional Offer

2.6 Consolidation

3. CHAIRMAN’S LETTER

Dear Investor

Digital CC

Digital Currency Mining

Digital Currency Arbitrage and Liquidity Desk

Development of Retail Products and Applications

Revolutionary

4. INVESTMENT OVERVIEW

4.1

The Company

4.2

Digital CC

4.3 Key Investment Highlights

4.4 Key Risks

(a) Increased regulation may adversely affect and reduce the appeal of Bitcoin and other digital currencies

(b) Taxation and Bitcoin

(c) Reinstatement to ASX’s official list

(d) Forecasts

(e) Unforeseen expenditure risk

(f) Development and commercialisation of products

(g) Volatility

(h) Bitcoin theft and security of private key

(i) Open source software risks

(j) Bitcoin exchanges risks

(k) Further technology risks

(l) Bitcoin mining risks

(m) Protection of technology rights

4.5 The Acquisition

4.6 Effect of the Acquisition

4.7 Business Model, New Business Development and Company Objectives

4.8 The Offer

4.9 Conditionality of Offer

4.10 Use of Funds

4.11 Capital Structure

Notes:

4.12 Substantial Shareholders

4.13 Restricted Securities

4.14 Financial Information

4.15

Taxation

4.16

Dividend Policy

4.17

Directors and Key Personnel

(a) Eugeni ‘Zhenya’ Tsvetnenko - Proposed Executive Chairman

(b) Alex Karis - Proposed CEO/Managing Director

(c) William Brindise – Proposed Executive Director and Chief Investment Officer

(d) Adeniyi Olalekan ‘Emmanuel’ Abiodun – Proposed Non-Executive Director

(e) Brett Lawrence – Current Managing Director and Proposed NonExecutive Director

4.18 Corporate Governance

4.19 Disclosure of Interests

Existing Directors

Proposed Directors

4.20 Agreements with Directors, Proposed Directors or Related Parties

DIGITALX LIMITED Capital/Financing Update 2014