INVESTSMART GROUP LIMITED — Capital/Financing Update 2013

Sep 24, 2013

Australasian Wealth Investments Limited

Non-renounceable Rights Issue of 2 Shares for every 3 Shares

At an issue price of $0.35 per New Share to raise up to $13,324,792

Offer Document

This Offer opens on 9 October 2013 and closes at 5:00pm (Sydney time) on 23 October 2013.

This Offer Document is not a prospectus

It does not contain all of the information that an investor would find in a prospectus or which may be required in order to make an informed investment decision regarding, or about the rights attaching to the New Shares offered under this Offer Document.

This document is important and requires your immediate attention.

It should be read in its entirety. If you do not understand its content or are in doubt as to the course you should follow, you should consult your stockbroker or professional adviser without delay.

Please read the instructions in this document and on the accompanying Entitlement and Acceptance Form regarding the acceptance of your Entitlement.

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Important information

This Offer Document is dated 25 September 2013. This Offer Document was prepared by Australasian Wealth Investments Limited ( AWI or Company ).

AWI will apply for admission of the New Shares to quotation on ASX within 7 days after the date of this Offer Document. The fact that ASX may grant official quotation of the New Shares is not to be taken in any way as an indication of the merits of AWI or the New Shares.

This Offer Document is not a prospectus

This Offer Document is given under Section 708AA(2)(f) of the Corporations Act. It is not a prospectus and it does not contain all of the information that an investor would find in a prospectus or which may be required to make an informed investment decision regarding, or about the rights attaching to, the New Shares offered by this Offer Document. It has not been and will not be lodged with ASIC. Neither ASIC, ASX nor their respective officers take any responsibility for the content of this Offer Document or for the merits of the investment to which this Offer relates.

As an Eligible Shareholder of AWI this Offer Document is important and requires your immediate attention.

You should read the entire Offer Document before deciding whether to invest in the New Shares. Please carefully read the instructions on the accompanying Entitlement and Acceptance Form regarding the acceptance of your Entitlement under the Offer. If you have any questions regarding your Entitlement or the Offer, please contact your legal, investment or other professional adviser.

No cooling off rights

Cooling off rights do not apply to an investment in New Shares. You cannot withdraw the application once it has been accepted. Further, Entitlements cannot be traded on the ASX or any other exchange, nor can they be privately transferred.

Professional advice

The information in this Offer Document is not financial product advice and does not take into account your investment objectives, financial situation or particular needs. It is important that you read this Offer Document in its entirety before deciding whether to apply for New Shares. In particular, you should consider the risk factors that could affect the performance of AWI, some of which are outlined in Section 6. You should carefully consider these factors in light of your personal circumstances (including financial and taxation issues) and seek professional guidance before deciding whether to apply for New Shares. If you have any questions you should seek professional advice from your legal, investment or other professional adviser.

Intermediary Authorisation

AWI does not hold an Australian Financial Services Licence ( AFSL ) under the Corporations Act. Accordingly, offers under this Offer Document will be made pursuant to an arrangement between AWI and holders of an AFSL ( Licensees ) pursuant to Section 911A(2)(b) of the Corporations Act. AWI will only authorise Licensees to make offers to people to arrange for the issue of Shares by AWI under the Offer Document and AWI will only issue Shares in accordance with such offers if they are accepted.

Bell Potter Securities Ltd (AFS No.243480) ( Lead Manager ) will manage the issue on behalf of AWI. The Lead Manager’s function should not be considered as an endorsement of the Offer nor a recommendation of the suitability of the Offer for any investor. The Lead Manager does not guarantee the success or performance of AWI or the returns (if any) to be received by investors. Neither the Lead Manager nor any other Licensee is responsible for, or has cause the issue of this Offer Document. AWI reserves the right to enter into similar arrangements to those with the Lead Manager with other Licensees.

Foreign jurisdictions

The distribution of this Offer in jurisdictions outside Australia or New Zealand may be restricted by law and persons who come into possession of this Offer outside Australia or New Zealand should seek advice on and observe any such restrictions. Any failure to comply with such restrictions may constitute a violation of applicable securities laws.

This Offer does not constitute an offer or invitation in any place outside Australia or New Zealand where, or to any person to whom, it would be unlawful to make such an offer or invitation. No action has been taken to register or qualify the New Shares or to otherwise permit an offering of the New Shares outside Australia.

United States

This document may not be released or distributed in the United States of America. This document does not constitute an offer to sell, or a solicitation of an offer to buy, securities in the United States. Any securities described in this document have not been, and will not be, registered under the US Securities Act of 1933 and may not be offered or sold in the United States except in transactions exempt from, or not subject to, registration under the US Securities Act and applicable US state securities laws.

No Guarantee

Neither AWI nor any other party makes any representation or gives any guarantee or assurance:

• (a) as to the performance or success of AWI;

• (b) as to the rate of income or capital growth from AWI; or

• (c) that there will be no capital loss or particular taxation consequence of investing in AWI.

An investment in AWI does not represent a deposit or any other type of liability of the above parties. An investment in AWI is subject to investment risk. These risks are discussed in Section 6.

Investors should note that the past share price and investment performance of AWI provides no guidance as to its future share price and investment performance.

No representations other than in this Offer Document

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

Future performance

Except as required by law, and only to the extent so required, neither AWI nor any other person warrants or guarantees the future performance of AWI or any return on any investment made pursuant to this Offer Document.

Privacy

By filling out the Entitlement and Acceptance Form to apply for New Shares, you are providing information to AWI (directly and/or via the Share Registry) that may constitute personal information for the purposes of the Privacy Act 1988 (Cth). AWI (and the Share Registry on its behalf) collects, holds and uses personal information provided on an Entitlement and Acceptance Form in order to assess your application and administer your holding of Shares.

If you do not provide the information requested in the Entitlement and Acceptance Form, AWI and the Share Registry may not be able to process or accept the form.

Access to your personal information may be provided to the Company’s agents and service providers on the basis that they deal with such information in accordance with this privacy disclosure statement. You have a right to request access to the personal information that the Company holds about you subject to certain exemptions under law. A fee may be charged for access. Access requests must be made in writing to the Registry:

Boardroom Pty Ltd Level 7, 207 Kent Street Sydney Australia 2000

Defined terms and conditions

Certain terms and abbreviations used in this Offer Document are defined in the Glossary in Section 8.

References to Australian dollars or $ are references to the lawful currency of Australia. Any discrepancies between the totals and the sum of all the individual components in the tables contained in this Offer Document are due to rounding.

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Important dates

Event	Date
Announcement of Offer	20 September 2013
Lodgement Date – Offer Document and Appendix 3B	25 September 2013
Despatch of notice to Shareholders containing the information required by Appendix 3B	26 September 2013
_Ex_Date – The date on which Existing Shares commence trading without the Entitlement to participate in the Offer	27 September 2013
Record Date – The date for determining Entitlements of Eligible Shareholders to participate in the Offer (7:00pm Sydney time)	3 October 2013
Offer Document sent to Shareholders – Anticipated despatch of Offer Document and Entitlement and Acceptance Forms – Offer opens	9 October 2013
Closing Date – The last day for receipt of Entitlement and Acceptance Forms (5:00pm Sydney time)	23 October 2013
Rights issue shares quoted on a deferred settlement basis	24 October 2013
Notification of under subscriptions to ASX	28 October 2013
Allotment Date – Allotment of New Shares under the Offer	31 October 2013
Despatch Date – Anticipated despatch of holding statements for New Shares (Deferred settlement trading in rights issue shares ends)	31 October 2013
Expected commencement of normal trading in New Shares on ASX	1 November 2013

The above dates and times are indicative only. All times and dates are a reference to Sydney time. AWI reserves the right to vary any of the above dates and times, including closing the Offer early or extending it subject to the Corporations Act, ASX Listing Rules and other applicable laws.

Key Offer statistics

Issue Price per New Share	$0.35
Total number of New Shares available under the Offer	38,070,836
Maximum total Shares on issue following the Offer	95,177,091
Maximum total proceeds of the Offer (before expenses of the Offer)	$13,324,792

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Corporate directory

Issuer

Australasian Wealth Investments Limited

Level 4, 1 Alfred Street

Sydney NSW 2000 Telephone: (02) 9080 2377 Facsimile: (02) 9080 2378 Website: www.australasianwealth.com.au

Directors

Mr Andrew Brown (Chairman, Director) Mr Andrew Barnes (Director) Mr Alastair Davidson (Director)

Mr John Reynolds (Non Exec. Director, Independent Director)

Company Secretary

Mr Richard Matthews

Registry

Boardroom Pty Limited Level 7, 207 Kent Street Sydney NSW 2000 Telephone: 1300 737 760 (within Australia) +612 9290 9600 (outside Australia) Facsimile: 1300 653 459 (within Australia) +612 92790664 (outside Australia) Website: www.boardroomlimited.com.au

Solicitors to the Offer

Watson Mangioni Lawyers Pty Limited Level 13, 50 Carrington Street Sydney NSW 2000 Telephone: (02) 9262 6666 Facsimile: (02) 9262 2626

Lead Manager

Bell Potter Securities Limited Level 38, Aurora Place 88 Phillip Street Sydney NSW 2000 Telephone: (02) 9255 7200 Facsimile: (02) 9255 7482 Website: www.bellpotter.com.au

Table of contents

1.	Chairman’s letter ......................................................................................................................... 1
2.	Frequently asked questions ........................................................................................................ 2
3.	Details of the Offer ...................................................................................................................... 3
4.	Action required by Eligible Shareholders ................................................................................... 5
5.	Purpose and effect of the Offer .................................................................................................. 7
6.	Risk factors ................................................................................................................................. 9
7.	Additional information ............................................................................................................... 13
8.	Glossary .................................................................................................................................... 15

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1. Chairman’s letter

25 September 2013

Dear Shareholder

On behalf of AWI, I am pleased to offer you the opportunity to participate in the Offer.

AWI is undertaking a non-renounceable rights issue of 2 New Share for every 3 Existing Shares held. The issue price of each New Share is $0.35, representing a discount of 27% to the closing price of the Existing Shares on the ASX on 19 September 2013, the day prior to the announcement of the Offer, and a discount of over 27.1% to the net tangible asset backing per share as at 31 August 2013.

The Offer will result in the issue of a maximum of 38,070,836 New Shares raising approximately $13,324,792 before expenses of the Offer.

The proceeds raised from the Offer will be used by AWI for working capital purposes, for potential new acquisitions, and to fund the acquisition of the Management Agreement from Aurora Funds Management Limited (ACN 092 626 885) and Andrew Barnes for $900,000.

On 25 September 2013, the Company placed 28,600,000 shares with sophisticated investors to fund the acquisition of InvestSmart Pty Ltd and associated companies, and the acquisition of further shares in van Eyk Group Holdings Ltd.

The Board urges you to read this Offer Document carefully before making a decision in respect to your Entitlement.

It is the intention of the majority of the Directors to subscribe for their full share entitlements.

I commend this Offer to you and thank you for your continued support of AWI.

Yours sincerely

Mr Andrew Brown Chairman Australasian Wealth Investments Limited

Australasian Wealth Investments Limited Level 4, 1 Alfred Street, Sydney NSW 2000 Telephone (02) 9080 2377 Fax (02) 9080 2378

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2. Frequently asked questions

Question	Answer	Where to find more information
Who is the issuer?	Australasian Wealth Investments Limited.	Section 3.1
What is the Offer?	A non-renounceable rights issue to raise approximately $13,324,792 (before expenses of the Offer). Eligible Shareholders may apply for all or part of their Entitlement under the Rights Offer.	Section 3.2
What are the terms of the Rights Offer?	2 New Share for each 3 Existing Shares at an issue price of $0.35 per New Share. As the issue is non-renounceable, Eligible Shareholders do not have the right to sell their Entitlements. Eligible Shareholders have the opportunity to subscribe for all, part or none of their Entitlement to New Shares.	Section 3.3
What will happen to the Shortfall Shares?	Any Shortfall Shares resulting from the Offer will be placed by the Directors at their discretion with sophisticated investors at a price not less than the Issue Price.	Section 3.4
What are the rights of New Shares?	New Shares rank equally in all respects with Existing Shares from their date of issue.	Section 3.6
How will the proceeds be applied?	Net proceeds of the Offer will be used for further investments consistent with AWI’s investment strategy, and to acquire the Management Agreement.	Section 5.2
Who can invest?	Eligible Shareholders of AWI as at 7:00 pm (Sydney time) on the Record Date (3 October 2013).	Section 3.3
What are the potential significant risks?	Eligible Shareholders of AWI are exposed to a number of risks in acquiring and holding Shares. Key risks specific to AWI include but are not limited to:  Further changes in financial services legislation  Failure to execute the new business strategy  Shareholders do not approve acquisition of Management Agreement at the AGM  Reliance on a small management team  Illiquidity in current investment portfolio  Reliance on continued growth in financial services	Section 6
Is the Offer underwritten?	No.
What are the expenses payable by AWI?	The total expenses of the Offer are expected to be approximately $660,000 (exclusive of GST).	Section 7.1
What are my alternatives?	You may either:  take up all or part of your Entitlement; or  do nothing and allow all of the New Shares representing your Entitlement to lapse.	Section 4
How can further information be obtained?	If you require advice as to whether to accept your Entitlement, you should seek professional advice from your legal, investment or other professional adviser.	Section 3.12

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3. Details of the Offer

3.1 Description of the issuer

AWI is the issuer of New Shares under this Offer Document.

3.2 Description of the Offer

The Offer consists of a total of 38,070,836 New Shares to be offered by AWI by way of a non-renounceable rights issue to raise up to approximately $13,324,792 (before expenses of the Offer). This takes the form of a 2 for 3 rights offer.

The Offer is explained in more detail in this Section 3.

3.3 Rights Offer

If you are an Eligible Shareholder, you are being offered an Entitlement to acquire 2 New Share for every 3 Existing Shares held as at the Record Date.

The Issue Price per New Share is $0.35.

The Entitlements are non-renounceable, meaning you do not have the right to sell your Entitlement. Eligible Shareholders have the opportunity to subscribe for all, part or none of their Entitlement to New Shares.

Your Entitlement is set out on the accompanying personalised Entitlement and Acceptance Form. If you have more than one holding of Shares, you will be sent more than one personalised Entitlement and Acceptance Form and you will have separate Entitlements for each holding.

3.4 Shortfall Shares

Any Shortfall Shares resulting from the Offer will be placed by the Directors at their discretion with sophisticated investors at a price not less than the Issue Price.

3.5 Offer not underwritten

The Offer is not underwritten.

3.6 Ranking of New Shares

The New Shares will be fully paid and rank equally in all respects with Existing Shares from their date of issue.

3.7 Allotment

AWI expects to allot all New Shares on 31 October 2013.

3.8 Application Monies

Until the time of allotment of New Shares, AWI will hold all Application Monies in relation to those New Shares in a purpose specific bank account. Interest earned on any Application Monies (whether or not allotment takes place) will remain the property of AWI.

Application will be made to ASX for quotation of the New Shares to be issued under the Offer within 7 days of the date of this Offer Document. If application is not so made or if quotation of the New Shares is not granted by ASX within 3 months of the date of this Offer, any allotment of New Shares in response to an application made under this Offer will be void, and all Application Monies received will be returned without interest.

3.9 No minimum subscription

There is no minimum subscription for the Offer.

3.10 Foreign Shareholders

This Offer is made only to Shareholders with a registered address in Australia or New Zealand or such other place in which, or to any person to whom, it would be lawful to make such an offer.

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AWI is of the view that it would be unreasonable to make the Offer to other overseas Shareholders ( Foreign Shareholders ) having regard to the:

• number of Foreign Shareholders (if any);

• number and value of New Shares that would be offered to Foreign Shareholders; and

• cost of complying with overseas legal requirements.

This Offer does not constitute an offer in any place in which, or to any person to whom, it would not be lawful to make such an offer. AWI is not required to make offers under this Offer to Foreign Shareholders. Where this Offer has been despatched to Shareholders domiciled outside Australia or New Zealand and where the country's securities code and/or legislation prohibits or restricts in any way the making of the offers contemplated by this Offer, this Offer is provided for information purposes only.

Shareholders resident in Australia or New Zealand holding Shares on behalf of persons who are resident overseas are responsible for ensuring that taking up Entitlements under the Offer does not breach regulations in the relevant overseas jurisdiction.

Return of a duly completed Entitlement and Acceptance Form will be taken by AWI to constitute a representation that there has been no breach of such regulations.

The offer contained in this Offer to Shareholders with registered addresses in New Zealand is made in reliance on the Securities Act (Overseas Companies) Exemption Notice 2002 (New Zealand). Members of the public in New Zealand who are not Shareholders on the Record Date are not entitled to apply for any New Shares.

AWI will appoint a nominee approved by ASIC holding an Australian Financial Services Licence ( Nominee ) to take up the Entitlements which would otherwise have been offered to Foreign Shareholders. The Nominee will sell the New Shares issued to it on taking up those Entitlements. All sales will be at prices and otherwise in the manner determined by the Nominee in its sole discretion. AWI and the Nominee will not be liable for any failure to sell the New Shares at any particular price. The proceeds of the sale, net of expenses, (if any) will be distributed to each of the Foreign Shareholders in proportion to their Entitlement.

3.11 Taxation

The taxation consequences of investing in the New Shares will depend on your particular circumstances. It is your responsibility, as a potential investor, to make your own enquiries concerning the taxation consequences of an investment in AWI. See Section 7.4 for a general discussion of taxation issues. If you are in doubt as to the consequences of an investment, you should consult with your taxation or other professional adviser before investing.

3.12 Enquiries

If you require advice as to whether to accept your Entitlement, you should seek professional advice from your legal, investment or other professional adviser.

If you have any queries about the Offer, your Entitlement and Acceptance Form, or your Entitlement, please contact the AWI Limited Shareholder Information Line on 1 300 737 760 (within Australia) or +61 2 9290 9600 (outside Australia) from 8.30am to 5.00pm (Sydney time), Monday to Friday.

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4. Action required by Eligible Shareholders

4.1 Your Entitlement

Your entitlement is shown on the accompanying Entitlement and Acceptance Form. Before taking any action in relation to the Offer, you should read this Offer Document in its entirety and seek professional advice from your accountant, stockbroker, lawyer or other professional adviser.

You may:

• take up all or part of your Entitlement (and you may apply for additional New Shares in excess of your Entitlement); or

• do nothing and allow all of the New Shares representing your Entitlement to lapse.

4.2 What happens if I accept my full Entitlement?

If you take up your full Entitlement under the Rights Offer, you will not have your shareholding in AWI diluted by the Offer.

4.3 What happens if I do not accept my full Entitlement?

If you do not take up your full Entitlement, your proportional shareholding in AWI will be diluted.

As the Entitlements are non-renounceable, if you decide not to take up all or part of your Entitlement, it will lapse on the Closing Date to the extent not taken up. In the event that Entitlements lapse, the Directors have reserved the right to place lapsed Entitlements at their discretion with sophisticated investors at a price not less than the Issue Price.

4.4 How do I accept all, or part, of my Entitlement?

You may accept your Entitlement following the despatch of this Offer Document (expected to be by 9 October 2013). AWI will accept Applications until the Closing Date.

If you decide to take up all or part of your Entitlement, or apply for additional New Shares, please complete and return the Entitlement and Acceptance Form with the requisite Application Monies OR pay your Application Monies via BPAY® by following the instructions set out on the Entitlement and Acceptance Form. AWI will treat you as applying for as many New Shares as your payment will pay for in full.

If not paying by BPAY®, the relevant Entitlement and Acceptance Form must be accompanied by cheque, bank draft or money order in Australian dollars drawn on an Australian branch of an Australian bank for the Issue Price of the New Shares for which application is made. All cheques must be made payable to "AWI Limited – Rights Offer Account" and crossed "Not Negotiable". Do not forward cash. Receipts for Application Monies will not be issued.

Completed Entitlement and Acceptance Forms and accompanying cheques must be returned to the following address and received no later than 5:00 pm (Sydney time) on the Closing Date.

Australasian Wealth Investments Limited

c/- Boardroom Pty Ltd Level 7, 207 Kent Street Sydney, New South Wales 2000 Australia

A reply paid envelope is enclosed for your convenience. If mailed in Australia, no postage stamp is required.

If you are paying by BPAY®, please make sure to use the specific Biller Code and unique Customer Reference Number ( CRN ) on your personalised Entitlement and Acceptance Form. If you receive more than one personalised Entitlement and Acceptance Form, please only use the CRN specific to the Entitlement on that Form. If you are paying by BPAY® payment, you do not need to mail the personalised Entitlement and Acceptance Form.

It is your responsibility to ensure that your BPAY® payment is received by the Share Registry by no later than 5:00pm (Sydney time) on the Closing Date. You should be aware that your financial institution may implement

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earlier cut-off times with regards to electronic payment, and you should therefore take this into consideration when making payment.

You should read this Offer Document in its entirety before deciding to take up your Entitlement.

4.5 Acceptance of applications under the Offer

Completing and lodging an Entitlement and Acceptance Form for the Offer or using the BPAY® facility referred to in the Entitlement and Acceptance Form for the Offer is an offer by you to AWI to subscribe for the number of New Shares specified in the Entitlement and Acceptance Form, or the number of New Shares equal to the amount paid using the BPAY® facility divided by the Issue Price, at the Issue Price on the terms and conditions set out in this Offer and the Entitlement and Acceptance Form.

An application for New Shares may be accepted in respect of the full amount applied for, or any amount less than that amount, without further notice to the relevant Eligible Shareholder. Acceptance of an application will give rise to a binding contract with acceptance to take place after the quotation of the New Shares on ASX.

4.6 No duty, brokerage or commission

No stamp duty, brokerage or commission is payable by applicants.

4.7 Licensed dealers

The Offer will be made pursuant to an arrangement between AWI and Licensees pursuant to Section 911A (2)(b) of the Corporations Act. AWI will only authorise Licensees to make offers to people to arrange for the issue of Shares by AWI under the Offers and AWI will only issue Shares in accordance with Applications made pursuant to such offers if they are accepted. AWI has entered into such an agreement with the Lead Manager.

The Lead Manager holds an appropriate AFS Licence. The Lead Manager will deposit and deal with the Application Monies pursuant to the Offer.

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5. Purpose and effect of the Offer

5.1 Overview

If the Offer is fully subscribed:

• the New Shares issued pursuant to the Offer will constitute approximately 40% of the total number of issued Shares immediately after the allotment of the New Shares; and

• the total number of Shares on issue after the allotment will be 95,177,091 Shares.

The Offer will provide the Company with net proceeds of up to approximately $12,664,792 after issue expenses of approximately $660,000. Please refer to Section 5.3 for further information regarding the effect of the Offer on the capital structure.

5.2 Use of funds

The proceeds raised from the Offer will be used for potential further investments consistent with AWI’s investment strategy, and to acquire the Management Agreement, subject to shareholder approval at the AGM.

5.3 Impact on capital structure

The table below shows the capital structure of AWI on completion of the Offer:

	Number of Shares	Percentage of post- Offer Shares
Existing Shares	57,106,255	60%
New Shares (maximum)	38,070,836	40%
Total immediately after Offer	95,177,091	100%

5.4 Impact on control

The issue of New Shares under the Offer is not expected to have a material effect on the control of AWI.

5.5 Pro forma balance sheet

Set out below is a pro forma balance sheet of AWI on successful completion of the Offer (assuming the Offer is fully subscribed). It is based upon AWI's balance sheet as at 30 June 2013 contained in the Company’s Annual Report for the year ended 30 June 2013 as lodged with ASX on 28 August 2013, and as adjusted for the Placement, and for subsequent acquisitions on further shares in van Eyk Group Holdings, and InvestSmart Pty Ltd.

The balance sheet has been prepared in accordance with the Corporations Act, the Corporations Regulations 2001, Accounting Standards and other mandatory financial reporting requirements in Australia.

The pro forma balance sheet reflects the impact of the Offer and all transaction costs as if they had occurred on 30 June 2013.

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Pro- forma Balance Sheet

($'000) Audited (30 June 2013) Receipt of trade receivables Placement (Net proceeds) 20 Sep 13 Purchase of van Eyk shares Purchase of InvestSmart Rights Issue (Net proceeds) 31 Oct 13 Purchase of management contract PRO-FORMA CURRENT ASSETS	($'000) Audited (30 June 2013) Receipt of trade receivables Placement (Net proceeds) 20 Sep 13 Purchase of van Eyk shares Purchase of InvestSmart Rights Issue (Net proceeds) 31 Oct 13 Purchase of management contract PRO-FORMA CURRENT ASSETS	($'000) Audited (30 June 2013) Receipt of trade receivables Placement (Net proceeds) 20 Sep 13 Purchase of van Eyk shares Purchase of InvestSmart Rights Issue (Net proceeds) 31 Oct 13 Purchase of management contract PRO-FORMA CURRENT ASSETS	($'000) Audited (30 June 2013) Receipt of trade receivables Placement (Net proceeds) 20 Sep 13 Purchase of van Eyk shares Purchase of InvestSmart Rights Issue (Net proceeds) 31 Oct 13 Purchase of management contract PRO-FORMA CURRENT ASSETS	($'000) Audited (30 June 2013) Receipt of trade receivables Placement (Net proceeds) 20 Sep 13 Purchase of van Eyk shares Purchase of InvestSmart Rights Issue (Net proceeds) 31 Oct 13 Purchase of management contract PRO-FORMA CURRENT ASSETS	($'000) Audited (30 June 2013) Receipt of trade receivables Placement (Net proceeds) 20 Sep 13 Purchase of van Eyk shares Purchase of InvestSmart Rights Issue (Net proceeds) 31 Oct 13 Purchase of management contract PRO-FORMA CURRENT ASSETS	($'000) Audited (30 June 2013) Receipt of trade receivables Placement (Net proceeds) 20 Sep 13 Purchase of van Eyk shares Purchase of InvestSmart Rights Issue (Net proceeds) 31 Oct 13 Purchase of management contract PRO-FORMA CURRENT ASSETS	($'000) Audited (30 June 2013) Receipt of trade receivables Placement (Net proceeds) 20 Sep 13 Purchase of van Eyk shares Purchase of InvestSmart Rights Issue (Net proceeds) 31 Oct 13 Purchase of management contract PRO-FORMA CURRENT ASSETS	($'000) Audited (30 June 2013) Receipt of trade receivables Placement (Net proceeds) 20 Sep 13 Purchase of van Eyk shares Purchase of InvestSmart Rights Issue (Net proceeds) 31 Oct 13 Purchase of management contract PRO-FORMA CURRENT ASSETS
Cash and cash equivalents 2,875 Trade and other receivables 3,126 Prepayments 11 Financial assets at fair value through profit and loss 7,833 TOTAL ASSETS 13,846 Trade and other payables 74 TOTAL LIABILITIES 74 NET ASSETS 13,772 EQUITY Share capital 28,618 Retained earnings -14,846 CURRENT LIABILITIES	2,875 3,126 11 7,833	3,126 -3,126	9,510	-6,658 6,658	-7,052 7,052	12,665	-900	13,566 - 11 21,543
								35,120 74
Trade and other payables TOTAL LIABILITIES NET ASSETS EQUITY Share capital Retained earnings
	74 13,772 28,618 -14,846		9,510			12,665	-900	74 35,046 50,792 -15,746
TOTAL EQUITY	13,772 35,046

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6. Risk factors

6.1 Overview

This Section 6 describes certain, but not all, risks associated with an investment in AWI. Prior to making an investment decision, prospective investors should carefully consider the following risk factors, as well as the other information contained in this Offer or of which they are otherwise aware. Directors emphasise that the risk factors set out in this Section are not the only risk factors that could affect the operations of the Company, its financial position and the value of Shares. Applicants should satisfy themselves as to the inherent risks associated with AWI and the financial services industry before applying for New Shares.

The business activities of AWI are subject to risks. These risks include those which apply generally to investments in equity markets, and those which apply specifically to the Company’s business. Some of the specific risks may be mitigated through the use of safeguards and contingency plans. However many risks are outside the control of the Company and its Directors and cannot be mitigated.

There can be no guarantees that AWI will achieve its stated objectives, that forecasts will be met or that forward looking statements will be realised.

The future performance of AWI and the future investment performance of the Shares may be influenced by a range of factors, many of which are outside the control of AWI or of any manager of any assets of AWI. The future value of AWI’s assets and the price at which the Shares trade on the ASX may be influenced by any one or more of these factors. The following matters and summary of material risk factors given below should be carefully considered in evaluating the prospects of the Company.

6.2 General risk factors

There are business and market risks inherent in any listed security, which could materially affect the Company’s earnings and the pricing of AWI Shares, including:

• (a) movements in local and international economies and share and capital markets;

• (b) changes in interest rates and other general economic conditions;

• (c) changes in investor sentiment and perceptions;

• (d) upheaval and uncertainty due to terrorist activities, insurrection, war and general conflict; and

• (e) changes in government fiscal, monetary and regulatory policies and statutory changes.

6.3 External risk factors

There are a number of external risk factors over which AWI has little or no control which could materially affect the future pricing of the Shares or the Company’s earnings, including:

• (a) taxation, where changes to tax legislation and regulation, or their interpretation, may adversely affect the value of an investment of the Company or your investment in the Shares and may affect AWI Shareholders differently;

• (b) changing economic conditions in Australia and globally will affect AWI’s business and financial condition. Any protracted slowdown in economic conditions or adverse changes in such factors as the level of inflation, interest rates, exchange rates, government policy (including fiscal, monetary and regulatory policies) and employment rates, among others, are outside the control of AWI and the Directors and may result in materially adverse impacts on the business and its operating results;

• (c) as a result of market volatility and disruption in recent years, governments around the world have taken unprecedented steps to try to stabilise the financial system, including investing in financial institutions and taking certain regulatory actions including the use of unconventional and untested monetary policies. The full extent of the effects of these actions and legislative and regulatory initiatives effected in connection with, and as a result of, such extraordinary disruption and volatility is uncertain, both as to the financial capital markets and participants in general.

• (d) stock market losses, poor investment returns or volatility, a weakening or a downturn of the financial services industry;

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• (e) changes in accounting standards or in the interpretation of those accounting standards that occur in the future may adversely impact on AWI’s business or the costs associated with AWI’s business and may adversely affect its financial condition;

• (f) illiquidity and subsequent volatility in the sale price of AWI Shares, with no guarantee that a more active market in AWI Shares will develop despite the increase in the number of AWI Shares in the event that the Offer is successful; and

• (g) risk of counterparties in the financial services industry, including brokers and dealers, commercial banks, investment banks, mutual and hedge funds and other institutions. These transactions expose AWI to credit risk in the event of default of one of our counterparties or clients.

6.4 Risks specific to the Company

(a) Change in legislation

With the election of a new government in Australia, there is a risk of further changes in legislation that relate to the future of financial advice (“ FOFA ”). The Company has acquired a business, InvestSmart Pty Ltd, which relies on the grandfathering of trailing commissions under FOFA legislation for a substantial portion of its revenue. While it appears that this provision will remain, further proposed legislative changes by the new government may impact on the Company’s ability to grow future revenue.

(b) Failure to execute new business strategy

The Company has recently announced a comprehensive change in the direction of the business, where AWI will change from a listed investment company to a holding company for a number of operating subsidiaries in the financial services industry, such a InvestSmart Pty Ltd and van Eyk Research Pty Ltd. The Company intends to acquire additional complementary businesses, some of which may not produce the expected profits for the Company.

(c) Acquisition of Management Agreement may not be approved

The Company will place a resolution before shareholders to acquire the current Management Agreement for $900,000 from Aurora and Andrew Barnes. This resolution may not be approved by shareholders, in which case, the Company will be liable for on-going management fees of 1.25% of net assets and potentially for performance fees of 15% based on changes in the valuations of the subsidiaries.

Additionally, the continuation of an external management agreement is likely to disadvantage the Company relative to conventional corporate structures and may inhibit the Company from future capital raisings on advantageous terms, or the capacity to efficiently use debt and equity in an optimal fashion.

(d) Current reliance on small management team

The Company’s success, growth strategy and identification of potential acquisitions depends heavily upon its Director, Andrew Barnes. The loss of his services for any reason could have a material and adverse effect on the Company’s business, operating results and financial condition.

(e) Intense Competition

The financial services industry, and all of the businesses in which we compete, are intensely competitive and we expect them to remain so. In particular, a number of factors increase the competitive risks of our business, notably:

• a number of our competitors have greater financial and other resources and more personnel than we do;

• there are relatively few barriers to entry impeding the launch of new asset management and financial advisory firms, including a relatively low cost of entering these businesses; and

• other industry participants will from time to time seek to recruit our employees away from us in order to compete in our lines of business.

This competitive pressure could adversely affect our ability to attract new or retain existing clients within investee companies, make successful investments, retain our personnel or maintain assets under advice, any of which would adversely impact our revenue and earnings.

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(f) Illiquidity of investments

Currently, the Company has a “see through” investment in 49.6% of the ordinary shares of vanEyk Research Pty. Limited (“ vER ”). vER is an unlisted company with other minority holders. In the event that vER’s business does not perform to AWI’s expectations, AWI can utilize its board representation to push for remedial action. However, if this is unsuccessful, and AWI wishes to sell its investment, there is no liquid market available for AWI to divest its vER securities.

(g) Current reliance on small number of investments

The Company’s current investment portfolio is less diversified and less liquid than most other listed investment companies. At the current time, the Company has only three investments, two of which are unlisted, the operating performance of which will influence the financial performance of the company:

• a “see through” investment in 49.6% of the ordinary shares of vER, an unlisted company with other minority holders;

• 100% ownership of InvestSMART Pty Ltd and PIDA Pty Ltd (“I nvestSMART ”), which are unlisted companies; and

• approximately 54 million shares of Straits Resources Limited, (“ SRQ ”), a copper mining company listed on ASX. SRQ is the last remaining investment from the previous investment manager and is in an operationally and financially distressed condition.

(h) Reliance on financial services industry

The primary focus of AWI is investment in listed and unlisted entities which hold financial assets or are involved in the financial services industry. The financial performance of such companies is heavily governed by overall conditions in financial markets, over which neither AWI nor the investee company has any control. As a consequence, the performance of investments held by AWI may exaggerate movements in overall financial markets in either a positive or negative manner;

(i) AWI’s results may be affected by fluctuations in the fair value of existing investments

AWI will be required in future periods to re-evaluate the carrying values of the existing investments in vER and InvestSMART. These investments are adjusted for accounting purposes to fair value at the end of each reporting period regardless of AWI’s intended holding period, with any related gains or losses or impairments reflected in our results of operations, and therefore may increase the volatility of our earnings, even though such gains or losses may not be realised.

(j) Holding company

AWI is a holding company and has no independent means of generating significant income. Accordingly, AWI depends upon distributions from its investments and InvestSMART, together with income on its own directly held financial resources to pay dividends and taxes and other expenses.

(k) No requirement to repurchase

The price at which AWI Shares are traded on ASX may be below the net asset value or management’s estimated value of those AWI Shares. AWI’s constitution does not entitle AWI Shareholders to require the Company to implement a share buy-back or any other capital reconstruction or to take any other remedial action;

(l) Licensing

Each of AWI’s major investments, vER and InvestSMART are holders of Australian Financial Services Licences (“ AFSLs ”). In the event that vER, InvestSMART, or its officers, Directors and management fail to adhere to or maintain the conditions of any AFSL, these licenses may be revoked or suspended, or their terms and conditions amended. In turn, this may result in entities for whom vER and InvestSMART provide advisory or administration services cancelling their agreements with vER and InvestSMART, leading to an adverse change to the financial condition of vER, InvestSMART and AWI. This situation may arise in any future investments or acquisitions made by AWI, which as a normal part of their business, are required to hold an AFSL.

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(m) Future Licensing and compliance

Each of vER and InvestSMART’s respective AFSL is subject to differing compliance requirements which may change in the future as a result of changes in legislation. This may result in vER and InvestSMART incurring increased costs to maintain the conditions of these AFSLs leading to an adverse change in their financial condition, and ultimately that of AWI.

(n) Investee Company and subsidiary employee misconduct

Employee misconduct, which is difficult to detect and deter, could harm AWI by impairing vER and InvestSMART’s ability to attract and retain clients and subject these investee companies and AWI to significant legal liability and/or reputational harm. For example, misconduct by employees of vER, InvestSMART or AWI could involve the improper use or disclosure of confidential information, which could result in legal action, regulatory sanctions and serious reputational or financial harm.

(o) Investee Company and subsidiary litigation risk

The financial services industry faces substantial litigation and regulatory risks, and vER and InvestSMART may face reputational harm and potential legal liability if their services are not regarded as being satisfactory, or for other reasons. For example, if a client is not satisfied with the services provided by either entity, such dissatisfaction may be more damaging to these business (due to their nature as financial services firms) than to other types of businesses, and this may impact upon the carrying values in the AWI accounts of vER and InvestSMART.

(p) Disaster Recovery Plan

AWI is currently dependent upon a financial management system operated by Aurora, which if damaged or disrupted could lead to financial loss. Aurora, on behalf of AWI, attempts to mitigate such damage by extensively utilising third party outsource providers, backing up key business records and maintaining a Disaster Recovery Plan. Each of vER and InvestSMART maintain separate financial management systems and Disaster Recovery Plans.

This list is not exhaustive and potential investors should read this Offer Document in full and, if they require further information on material risks, seek professional advice.

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7. Additional information

7.1 Expenses of the Offer

Expenses connected with the Offer are being borne by AWI. The approximate expenses of the Offer including legal fees, registry fees, printing fees and other general costs are estimated to be $660,000 (exclusive of GST).

7.2 Disclosure

This Offer Document contains an Offer to subscribe for continuously quoted securities (as defined in the Corporations Act) of AWI and has been prepared in accordance with Section 708AA(2)(f) of the Corporations Act.

In broad terms, Section 708AA relates to rights issues by certain listed companies that do not require the provision of a prospectus or other disclosure document to investors under Part 6D.2 of the Corporations Act. Accordingly, the level of disclosure in this Offer Document is significantly less than that required in a prospectus. Eligible Shareholders should therefore rely upon their own knowledge of AWI, refer to disclosures already made by it to ASX, and refer to their professional adviser before deciding to accept the Offer.

7.3 Continuous disclosure and documents available for inspection

AWI is a disclosing entity within the meaning of the Corporations Act 2001 and is, and has for the past twelve months been, subject to regular reporting and disclosure obligations.

AWI believes that it has, as at the date of this Offer Document, fully complied with the general and specific requirements as set forth by the ASIC and ASX in relation to continuous disclosure, which includes the provisions of Chapter 2M of the Corporations Act as they apply to AWI and Section 674 of the Corporations Act.

Copies of documents lodged with ASIC in relation to AWI may be obtained from, or inspected at, an office of the ASIC.

7.4 Taxation

Set out below is a summary of the Australian tax implications of the Offer for Eligible Shareholders who are residents of Australia for tax purposes and who hold their Shares as capital assets.

The summary below also does not take account of any individual circumstances of any particular Eligible Shareholder. Eligible Shareholders should seek specific advice applicable to their own particular circumstances from their own financial or tax advisers.

The summary below does not necessarily apply to Eligible Shareholders who hold their Shares as assets used in carrying on a business or who may carry on the business of security trading, banking or investment. The summary below does not necessarily apply to Eligible Shareholders whose Shares are held as revenue assets or trading stock. The summary below is based on the law in effect as at the date of this Offer Document.

(a) Issue of Entitlements

Subject to the qualifications noted above, the issue of the Entitlements will not itself result in any amount being included in the assessable income of an Eligible Shareholder.

(b) Exercise of Entitlements

Eligible Shareholders who exercise their Entitlements and subscribe for New Shares will acquire those shares with a cost base for capital gains tax ( CGT ) purposes equal to the Issue Price payable by them for those shares plus any non-deductible incidental costs they incur in acquiring those shares, but will not make any capital gain or loss, or assessable income, from exercising the Entitlements or subscribing for the New Shares.

(c) New Shares

Eligible Shareholders who exercise their Entitlements will acquire New Shares. Any future distributions made in respect of those New Shares will be subject to the same taxation treatment as distributions made on Shares held in the same circumstances.

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On any future disposal of New Shares, Eligible Shareholders may make a capital gain or capital loss, depending on whether the capital proceeds of that disposal are more than the cost base or less than the reduced cost base of the New Shares. The cost base of those shares is described above.

New Shares will be treated for the purposes of the CGT discount as having been acquired when the Eligible Shareholder exercised the Entitlement to subscribe for them. Accordingly, in order to benefit from the CGT discount in respect of a disposal of the New Shares, they must have been held for at least 12 months from the date the Entitlements were exercised to subscribe for them.

(d) Other Australian taxes

No Australian Goods and Services Tax (GST) or stamp duty is payable in respect of the grant or exercise of the Entitlements or the acquisition of New Shares.

7.5 Disclaimer of representations

No person is authorised to give any information, or to make any representation, in connection with the Offer that is not contained in this Offer Document.

Any information or representation that is not in this Offer Document may not be relied on as having been authorised by AWI or any of their related bodies corporate in connection with the Offer. Except as required by law, and only to the extent so required, none of AWI, or any other person, warrants or guarantees the future performance of AWI or any return on any investment made pursuant to this Offer Document.

7.6 Rounding of Entitlements

Where fractions arise in the calculation of Entitlements, they will be rounded up to the nearest whole number of New Shares.

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8. Glossary

AFSL

an Australian Financial Services Licence

Application a valid application by way of an Entitlement and Acceptance Form made to subscribe for a specified number of New Shares under the Offer Application Monies the monies received from applicants for New Shares in accordance with this Offer Document AGM the AWI AGM scheduled to be held at Level 38, 88 Phillip St Sydney, NSW 2000 on 14 November 2013 ASIC the Australian Securities and Investments Commission ASX the ASX Limited (ABN 98 008 624 691) ASX Listing Rules the listing rules of ASX Aurora Aurora Funds Management Limited (ACN 092 626 885) AWI Australasian Wealth Investments Limited (ACN 111 772 359) Business Day a day on which ASX is open for trading Closing Date 23 October 2013 Constitution the constitution of AWI as amended from time to time Corporations Act the Corporations Act 2001 (Cth) Directors the directors of AWI Eligible Shareholder a person who is a Shareholder at the Record Date and who is not a Foreign Shareholder Entitlement the non-renounceable right of an Eligible Shareholder to subscribe for New Shares under the Rights Offer Entitlement and Acceptance the personalised form attached to or accompanying this Offer Form Document Existing Shares Shares on issue immediately before the Record Date Foreign Shareholder a Shareholder described as a Foreign Shareholder in Section 3.10 GST goods and services tax Issue Price the issue price of $0.35 per New Share Lead Manager Bell Potter Securities Limited Licensee a holder of an AFSL Management Agreement the Management Agreement Deed of Novation dated 28 March 2013 entered into between AWI and Aurora Funds Management Ltd (ACN 092 626 885)

New Shares

Offer

the Shares offered under this Offer Document the Rights Offer and the Shortfall Offer

Offer Document

this document and any supplementary or replacement Offer

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Document in relation to this document

Placement

the placement by AWI of 28,600,000 Shares with sophisticated investors on 25 September 2013, to fund the acquisition of InvestSmart Pty Ltd and associated companies

Record Date

the date for determining Entitlements under the Offer, being 7:00pm (Sydney time) on 3 October 2013

Rights Issue

the issue of New Shares upon receipt of valid acceptances under the Rights Offer

Rights Offer the offer of Entitlements to New Shares under this Offer Document Shareholder a registered holder of Shares Share Registry Boardroom Pty Limited (ACN 003 209 836) Share an ordinary share in AWI Shortfall

the shortfall in applications for New Shares under the Rights Offer (if any)

Shortfall Shares

the New Shares for which applications are not received under the Rights Offer prior to the Closing Date