MOAB MINERALS LIMITED — Capital/Financing Update 2009

Sep 16, 2009

ADULTSHOP.COM LIMITED ACN 009 147 924

NON RENOUNCEABLE ENTITLEMENT ISSUE PROSPECTUS

FOR THE PURPOSE OF

A pro rata non-renounceable entitlement issue of approximately 306,796,528 Shares and 153,398,264 free attaching Options on the basis of two (2) Shares at an issue price of $0.004 per Share and one (1) free attaching Option for every two (2) Ordinary Shares held by Shareholders at the Record Date to raise approximately $1,227,186 before deducting the costs of the Issue.

Underwriters

THE ISSUE IS FULLY UNDERWRITTEN BY ENTITIES ASSOCIATED WITH MESSRS DAY, MOORE AND MOSER, BEING DIRECTORS OF THE COMPANY. PLEASE REFER TO SECTION 3.6 OF THIS PROSPECTUS FOR FURTHER INFORMATION ON THE TERMS OF THE UNDERWRITING.

IMPORTANT NOTICE

This Prospectus including each of the documents attached to it and which form part of this Prospectus is important and should be read in its entirety.

If you do not fully understand this Prospectus, or are in any doubts as to how to deal with it, you should consult your stockbroker, solicitor, accountant, bank manager or other professional adviser without delay.

THE SECURITIES OFFERED BY THIS PROSPECTUS SHOULD BE CONSIDERED SPECULATIVE

TABLE OF CONTENTS

1.	CORPORATE DIRECTORY	2
2.	SUMMARY OF IMPORTANT DATES AND IMPORTANT NOTES	3
3.	DETAILS OF THE ISSUE AND THE SHORTFALL OFFER	5
4.	PURPOSE AND EFFECT OF THE ISSUE	9
5.	RIGHTSATTACHING TO SECURITIES	10
6.	RISK FACTORS	12
7.	ADDITIONAL INFORMATION	14
8.	DEFINED TERMS	19
9.	DIRECTORS’ CONSENT	20
OPTION EXERCISE FORM		21
ENTITLEMENT AND ACCEPTANCE FORM (SAMPLE)		22

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1. CORPORATE DIRECTORY

Directors: Kimberley Heitman (Non-Executive Chairman) Malcolm Day (Managing Director) Bradley Moore (Non-Executive Director) Hans Rudolf-Moser (Non-Executive Director) Company Secretary: John Burness Registered and 118 Roe Street Principal Office: Northbridge WA 6003 Telephone : (08) 9227 6777 Facsimile : (08) 9277 6788 Website: www.adultshop.com Quoted On: Australian Securities Exchange Code – ASC (Shares) German Stock Exchange WKN873083 Share Registry: Advanced Share Registry Limited * 150 Stirling Highway NEDLANDS WA 6009 Telephone : (08) 9389 8033 Facsimile : (08) 9389 7871 Auditors: Ernst & Young * Level 34, Central Park 152 – 158 St Georges Terrace Perth WA 6000

• These entities are named in the Corporate Directory for information purposes only. They have not been involved in the preparation of any part of this Prospectus

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2. SUMMARY OF IMPORTANT DATES AND IMPORTANT NOTES

2.1 Timetable and Important Dates*

Company announces Entitlement Issue	9thSeptember 2009
Lodgement of Prospectus with ASIC	16thSeptember 2009
Notice sent to Shareholders	17thSeptember 2009
Ex Entitlement date	21stSeptember 2009
Record Date for determining Shareholder entitlements	25thSeptember 2009
Prospectus dispatched to Shareholders	1stOctober 2009
Acceptances close	16thOctober 2009
Securities quoted on a deferred settlement Basis	17thOctober 2009
Notify ASX of under-subscriptions – Underwriters Shortfall	21stOctober 2009
Despatch Date – Allotment of Securities and advice of un- certificated holdings	23rdOctober 2009

• These dates are determined based upon the current expectations of the Directors and may be changed with 6 Business Days’ prior notice.

2.2 Important Notes

Shareholders should read this document in its entirety and, if in doubt, should consult their professional advisors.

This Prospectus is dated 16 September 2009 and a copy of this Prospectus was lodged with the ASIC on that date. The ASIC and ASX take no responsibility for the content of this Prospectus.

The expiry date of the Prospectus is 15 October 2010 (Expiry Date). No Shares or Options will be allotted or issued on the basis of this Prospectus after the Expiry Date.

Applications for Shares and Options offered pursuant to this Prospectus can only be submitted on an original Entitlement and Acceptance Form which accompanies this Prospectus.

This Prospectus 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.

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. Failure to comply with these restrictions may violate securities laws. 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.

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.

In making representations in this Prospectus regard has been had to the fact that the Company is a disclosing entity for the purposes of the Corporations Act and certain matters may reasonably be expected to be known to investors and professional advisers whom potential investors may consult.

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2.3 Electronic Prospectus

Any person accessing the electronic version of this Prospectus for the purpose of making an investment in the Company must be an Australian resident and must only access the Prospectus from within Australia.

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

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3. DETAILS OF THE ISSUE

3.1 Non-Renounceable Issue

By this Prospectus, the Company offers for subscription approximately 306,796,528 Shares pursuant to a pro-rata non-renounceable entitlement issue to existing Shareholders of two (2) Shares at an issue price of $0.004 per Share and one (1) free attaching Option for every two (2) Ordinary Shares held by Shareholders as at the Record Date to raise approximately $1,227,186 (before expenses of the Issue). The free attaching Options shall be exercisable at $0.008 on or before 31 December 2011.

Holders of existing Options will not be entitled to participate in the Issue. The Company currently has 6,120,000 Options on issue as at the date of this Prospectus. These Options may be exercised by the Option holders prior to the Record Date in order to participate in the Issue.

3.2 Shares to Rank Equally

The Shares to be issued pursuant to this Prospectus will rank equally in all respects with the Company’s existing issued Shares.

3.3 Purpose of the Issue

The purpose of the Issue and the use of the funds are set out in Section 4 of this Prospectus.

3.4 Fractional Entitlements

Fractional entitlements arising from the Issue will be rounded up to the nearest whole number.

3.5 Minimum Subscription

There is no minimum subscription level set for this Issue.

3.6 Underwriting

The Issue is fully underwritten by the Underwriters, up to a maximum of 306,796,528 Shares (subject to the terms of the Shortfall Offer, as discussed below). Further details of the terms of the underwriting are set out in section 7.2 of this Prospectus.

To comply with the requirement to fully disclose the Underwriters’ approximate potential voting power in the Company and the effect of the underwriting by the Underwriters, the table below sets out various scenarios to indicate the effect on the Company’s shareholding depending on the Shortfall (if any), assuming no existing Options are exercised and assuming each Underwriter (or its associated entity) takes up its maximum entitlement under the Issue (as they have indicated they will). The potential maximum voting increase in the shareholding and voting power of the Underwriters in set out in the tables below (100% Shortfall) and will only occur if no Shareholders take up their entitlement under the Issue.

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Event	Shares held by Mr Day (direct/indirect)*	Voting Power Mr Day	Shares held by Mr Moore (direct/indirect)*	Voting Power Mr Moore	Shares held by Mr Moser (direct/indirect)*	Voting Power Mr Moser
Holding as at the date of this Prospectus	44,147,859	14.4%	Nil	Nil	1,500,000	0.5%
Entitlement	44,147,859	-	Nil	-	1,500,000	-
After issue of Shares assuming 100% Shortfall	175,345,274	28.6%	87,049,556	14.2%	90,049,556	14.7%
After issue of Shares assuming 75% Shortfall	153,582,885	25.0%	65,287,167	10.6%	68,287,167	11.1%
After issue of Shares assuming 50% Shortfall	131,820,496	21.5%	43,524,778	7.1%	46,524,778	7.6%
After issue of Shares assuming 25% Shortfall	110,058,107	17.9%	21,762,389	3.5%	24,762,389	4.0%

*Rounded up to the nearest whole number.

The information in the table above shows the potential effect of the underwriting of the Issue by the Underwriters. However, it is unlikely that no Shareholders will take up their entitlement under this Prospectus. The underwriting obligation of the Underwriters, and therefore the voting power of the Underwriters, will reduce by a corresponding amount for the amount of entitlements taken up by other Shareholders. In addition, the future pattern of shareholding of the Company will change depending on the take up of entitlements of other Shareholders.

3.7 How to Accept Your Entitlement

Your acceptance of your entitlement must be made on the Entitlement and Acceptance Form accompanying this Prospectus. Your acceptance must not exceed your entitlement as shown on that form. If it does, your acceptance will be deemed to be the maximum entitlement.

You may participate in the Issue as follows:

• (a) if you wish to accept your entitlement in full:

• (i) complete the Entitlement and Acceptance Form by filling in the details in the spaces provided; and

• (ii) attach your cheque for the amount indicated on the Entitlement and Acceptance Form; or

• (b) if you wish to accept part of your entitlement only:

• (i) fill in the number of Shares you wish to accept in the space provided on the Entitlement and Acceptance Form; and

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• (ii) attach your cheque for the appropriate application moneys (at $0.004 per Share); or

• (c) if you do not wish to accept all or part of your entitlement, you are not obliged to do anything.

If you wish to participate in the Issue, you must forward the completed Entitlement and Acceptance Form together with your cheque drawn on an Australian Bank or bank draft made payable in Australian currency to "Adultshop.com Limited – Rights Issue Account" and crossed "Not Negotiable" for the appropriate amount to the Company in the enclosed self addressed envelope to:

Advanced Share Registry Limited PO Box 1156 NEDLANDS WA 6909

Your completed Entitlement and Acceptance Form and cheque must reach the share registry no later then 5:00pm WST on the Closing Date, or such other dates and times determined and advised by the Directors.

The Issue is non-renounceable. This means that Shareholders may not sell or transfer all or part of their entitlement to apply for Shares and Options.

In accordance with the ASX Listing Rules, the Company will allow an extension of at least 3 Business Days to member organisations of ASX to lodge acceptances after the Closing Date.

3.8 Listing ASX

Application will be made to ASX for quotation of the Shares offered under this Prospectus within 7 days after the date of this Prospectus.

The Company will not issue any Shares pursuant to this Prospectus unless permission is granted by ASX for the Shares offered to be quoted on the Official List of ASX. If granted, trading of the Shares will commence on a deferred settlement basis on 17[th] October 2009. It is the responsibility of each applicant to determine the number of Shares allotted and issued to them.

If the Shares offered under this Prospectus are not admitted to Official Quotation by ASX within three months after the date of this Prospectus, unless the ASIC grants the Company an exemption permitting the issue, the Company will not allot or issue any Securities pursuant to this Prospectus and will return all application moneys within the time prescribed under the Corporations Act, without interest.

Application will also be made to the ASX for quotation of the free attaching Options offered pursuant to this Prospectus, provided that the conditions prescribed by ASX for the quotation of a new class of security are satisfied. This includes but is not limited to a condition that there are atleast 50 holders of free attaching Options each holding a marketable parce. In the event that these conditions are not met at the time of allotment, the Company will make application for quotation at the time that the conditions for quotation of the free attaching Options as required by ASX are satisfied.

The Company is entitled to proceed to allot and issue Securities the subject of valid acceptances if permission for Official Quotation of the Shares pertaining to those acceptances has been granted by ASX.

3.9 Allotment of Securities

In accordance with the Corporations Act, until the Securities offered pursuant to this Prospectus have been allotted and issued, all application moneys shall be held by the Company in trust in a bank account established for the purpose of depositing application moneys received.

No Securities will be allotted or issued on the basis of this Prospectus (other than Shares issued pursuant to the exercise of an Option) later than 13 months after the date of issue of this Prospectus.

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3.10 Privacy Act

If you complete an Entitlement and Acceptance Form, you will be providing personal information to the Company (directly or by the Company’s share registry). The Company collects, holds, and will use that information to assess your application, service your needs as a Security holder, facilitate distribution payments and corporate communications to you as a Security holder and carry out administration.

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

You can access, correct and update the personal information that we hold about you. Please contact the Company or its share registry if you wish to do so at the relevant contact numbers set out in this Prospectus.

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

3.11 Taxation

The Directors make no comment in relation to the taxation implications of the Issue to Shareholders. The taxation consequences will depend on a Shareholder's particular circumstances. Neither the Company, nor any of its officers accepts any liability or responsibility with respect to the taxation consequences connected with the Issue.

3.12 Overseas Residents

This Prospectus 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. Applicants who are resident in countries other than Australia should consult their professional advisors as to whether any governmental or other consents are required or whether any formalities need to be considered and followed.

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

The Company will apply to ASX to participate in CHESS, for those investors who have, or wish to have, a sponsoring broker. Investors who do not wish to participate through CHESS will be issuer sponsored by the Company. Because the sub-registers are electronic, ownership of Shares and Options can be transferred without having to rely upon paper documentation.

Electronic sub-registers mean that the Company will not be issuing certificates to investors. Instead, investors will be provided with a statement (similar to a bank statement) that sets out the number of Shares and Options allotted 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.

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.

3.14 Enquiries

Any questions concerning the Issue should be directed to the Company Secretary, John Burness, on +61 8 9227 6777.

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4. PURPOSE AND EFFECT OF THE ISSUE

4.1 Purpose and Use of Funds

The Purpose of the Issue is to raise approximately $1,227,186 before expenses of the Issue.

The Company intends to apply the funds raised as follows:

• (a) to provide funds for the review and acquisition of potential new opportunities, including but not limited to those in the technology, industrial and/or resources sectors;

• (b) to meet the working capital requirements of the Company; and

• (c) to meet the costs of the Issue.

4.2 Effect of the Issue on Pro Forma Consolidated Balance Sheet and Capital Structure

The principal effect of the Issue, and the pro forma capital structure, following completion of the Issue will be to:

• (a) increase cash reserves by approximately $1,227,186 immediately after completion of the Issue and before deducting the estimated expenses of the Issue;

• (b) increase the number of Shares on issue from 306,796,528 to 613,593,056; and

• (c) increase the number of Options on issue from 6,120,000 to 159,518,264.

A comparative table of changes in the capital structure of the Company as a consequence of the Issue is set out below:

NUMBER DETAILS Issued and Paid Up Capital 306,796,528 Ordinary Shares on issue 306,796,528 Total issued and paid up capital 306,796,528 Shares Offered for Subscription Shares to be issued at $0.004 each pursuant to this Prospectus. 613,593,056 Total Issued and Paid Up Capital Options Over Unissued Capital 2,040,000 Unlisted Options exercisable at $0.047 and expiring 3 January 2012 2,040,000 Unlisted Options exercisable at $0.067 and expiring 3 January 2012 2,040,000 Unlisted Options exercisable at $0.087 and expiring 3 January 2012 153,398,264 Options exercisable at $0.008 and expiring 31 December 2011 to be issued pursuant to this Prospectus.		$ VALUE
		68,217,000
		68,217,000
		1,227,186 69,444,186

159,518,264

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5. RIGHTS ATTACHING TO SECURITIES

5.1 Shares

The share capital of the Company is not divided into different classes of shares. All Shares offered by this Prospectus are ranked equally in all respects. Shares to be issued following the exercise of any Option will also rank equally. Full details of the rights attaching to the Shares are set out in the Constitution, a copy of which can be inspected at the Company’s registered office during normal business hours. The following is a broad summary (not an exhaustive or definitive statement) of the rights attaching to Shares.

Voting Rights

Subject to any rights or restrictions for the time being attached to any class or classes of Shares, at a General Meeting of Adultshop.com every holder of fully paid ordinary Shares present in person or by an attorney, representative or proxy shall have one vote on a show of hands and one vote per Share on a poll.

A person who holds a Share which is not fully paid is entitled, on a poll, to such number of votes as bears the same proportion to the total of those Shares registered in the shareholder’s name as the amount of the issue price of shares paid bears to the total issue price. In the case of joint holders of Shares, the vote of the senior who tenders a vote, whether in person or by proxy, attorney or representative, shall be accepted to the exclusion of the votes of the other joint holders and, for this purpose, seniority shall be determined by the order in which the names stand in the Register of Shareholders.

Dividend Rights

The Directors may declare and authorise for distribution from the profits of the Company a dividend to be distributed to shareholders according to their respective rights and interests, including authorisation and distribution of an interim dividend. Subject to the terms of issue of shares the Company may pay a dividend on one class to the exclusion of another class of shares. Each share on which the Directors resolve to pay a dividend carries the right to participate in the same proportion that the amount for the time being being paid bears to the total issue price of the share except that amounts paid in advance of calls and amounts credited but not actually received are ignored.

Rights of 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 a value as the liquidator considers fair upon any property to be so decided, may determine how the division is to be carried out as between the shareholders or different classes of shareholders, and may vest assets of the Company in trustees of any trusts for the benefits of members as the liquidator thinks appropriate.

Transfer of Shares

Subject to the Constitution of the Company, the Corporations Act and the Listing Rules, ordinary shares are freely transferable.

Creation and Issue of Further Shares

The allotment and issue of any new Shares is under the control of the Directors and, subject to any restrictions on the allotment of Shares imposed by the Company’s Constitution, the Listing Rules and/or the Corporations Act, the Directors may allot, issue, grant options over, or otherwise dispose of, those shares to such persons on such terms and conditions and with such rights and privileges as they may from time to time determine.

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Variation of Rights

Subject to the Corporations Act, the rights, privileges and restrictions attaching to any class of shares can be altered with the approval of a resolution passed at a general meeting of the holders of that class of shares or by consent in writing of the holders of a majority of the issues shares of that class.

General Meetings & Notices

Each Shareholder is entitled to receive notice of, and to attend and vote at, general meetings of the Company and to receive all notices, accounts and other documents required to be furnished to shareholders under the Company’s Constitution, the Corporations Act and the Listing Rules.

5.2 Options

Each Option will entitle the holder to subscribe for a fully paid ordinary Share in the Company on the following terms:

• (a) The Options shall expire at 5:00 pm Western Standard Time on 31 December 2011 but may be exercised at any time prior to 31 December 2011.

• (b) The Options are exercisable at $0.008 each payable in cash.

• (c) The Options are exercisable wholly or in part by the Option holder executing and forwarding to the Company an Option Exercise Form.

• (d) There are no participating rights or entitlements inherent in the Options to participate in any new issue or bonus issue of Securities which may be offered to members of the Company from time to time prior to or on 31 December 2011.

• (e) Optionholders have the right to exercise their Options prior to the date of determining entitlements to any capital issue to the then existing shareholders of the Company made during the currency of the Options. In this regard, Optionholders shall be given at least 10 Business Days’ notice, before the determination of entitlements to any issue, to exercise their Options.

• (f) In the event of any reconstruction (including consolidation, sub-division, reduction or return) of the issued capital of the Company, the Options will be re-organised in accordance with the Listing Rules applicable at the time of the re-organisation.

• (g) Application for Official Quotation of the Options will be made by the Company in accordance with the ASX Listing Rules and the Corporations Act. In addition, application for Official Quotation of the Shares allotted and issued pursuant to the exercise of the Options will be made by the Company within three (3) Business Days after the date of allotment of such Shares.

• (h) Shares allotted and issued pursuant to the exercise of the Options will be allotted and issued no more than 15 days after the receipt of a properly executed exercise notice and receipt of the application moneys.

• (i) A statement will be issued for the Options. Attached to the statement there will be a form that must be executed and forwarded to the Company when exercising the Options. If there is more than one Option on a statement and, prior to 31 December 2011 those Options are exercised in part, the Company will issue another statement for the balance of the Options held and not yet exercised.

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6. RISK FACTORS

The Securities offered by this Prospectus should be considered speculative because of the general and certain specific risks, which relate directly to the Company’s business. These risks are largely beyond the control of the Company and its Directors because of the nature of the business of the Company.

The following summary, which is not exhaustive, represents some of the major risk factors that Shareholders need to be aware of:

6.1 General Risks

As the Company is a company listed on the ASX, its share price is subject to numerous influences that may affect both the broad trend in the share market and the share prices of individual companies.

Economic conditions, both domestic and global, may affect the performance of the Company and ultimately the price of its shares. Factors such as currency fluctuations, inflation, interest rates, commodity prices, customer preferences, supply and demand and political, taxation, and legal decisions could have an impact on operating costs, profit margins and stock market prices. The Company’s future revenues and share prices can be affected by such factors, which may be beyond the control of the Company.

The two factors expected to most affect the price of the free attaching Options on the ASX are:

• (a) the price of the Shares on the ASX; and

• (b) the time to expiry of the free attaching Options.

As the price of the free attaching Options is linked to the price of the Shares, the same factors that affect the price of Shares will affect the price of the free attaching Options.

6.2 Specific Risks

Risk factors specifically applicable to the Company, to the industry that it presently operates, and those areas of interest to the Company include:

Regulatory Environment

The capacity to operate in the adult industry is affected by changes in government policy and legislation affecting the sale and distribution of the Company’s products and services.

Credit Card Processing Companies

The Company’s ability to sell products and services on the internet depends on being able to process sales on line by the use of third party credit card processing companies. The Company’s ability to maintain these relationships is critical in its ability to derive revenue from the sale of products and services online.

Competition

The Company faces challenges to compete against businesses operating outside the laws that govern the jurisdictions that it operates within.

Key Person Risk

The ability to retain and attract the calibre of staff and senior managers with the requisite skills and experience needed to successfully operate the various divisions of the Company, and to source, review and operate new opportunities evaluated by the Company in the technology, industrial and resources environments.

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Opportunity Risk

Risks ordinary associated with identifying, acquiring and operating new opportunities in the technology, industrial and resources sectors, including but not limited to:

• future capital requirements to adequately fund the acquisition and operation of those opportunities;

• research and development or exploration and feasibility risks, as the case may be, that determine the ultimate viability of a potential opportunity;

• governmental, sovereign, native title & community, and environmental risks impacting the ongoing tenure, development and viability of potential opportunities; and

• competition for potential opportunities that have the potential to deliver shareholder value.

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7. ADDITIONAL INFORMATION

7.1 Continuous Disclosure Obligations

The Company is a “disclosing entity” (as defined in Section 111AC of the Corporations Act) for the purposes of Section 713 of the Corporations Act and, as such, is 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.

This Prospectus is a “transaction specific prospectus”. In general terms “transaction specific prospectuses” are only required to contain information in relation to the effect of the issue the Shares and free attaching Options pursuant to the Issue on the Company and the rights attaching to those securities. It is not necessary to include general information in relation to all of the assets and liabilities, financial position, profits and losses or prospects of the issuing Company.

This Prospectus is intended to be read in conjunction with the publicly available information in relation to the Company which has been notified to the ASX and does not include all of the information that would be included in a prospectus for an initial public offering of Shares and Options in an entity that is not already listed on a stock exchange. Investors should therefore have regard to the other publicly available information in relation to the Company before making a decision whether or not to invest.

Having taken such precautions and having made such enquiries as are reasonable, the Company believes that it has complied with the general and specific requirements of the ASX as applicable from time to time throughout the 12 months before the issue of this Prospectus which required the Company to notify ASX of information about specified events or matters as they arise for the purpose of ASX making that information available to the stock market conducted by the ASX.

The Company, as a disclosing entity under the Corporations Act states that:

• (a) it is subject to regular reporting and disclosure obligations;

• (b) copies of documents lodged with the ASIC in relation to the Company (not being documents referred to in Section 1274(2)(a) of the Corporations Act) may be obtained from, or inspected at, the offices of the ASIC; and

• (c) it will provide a copy of each of the following documents, free of charge, to any person on request between the date of issue of this Prospectus and the Closing Date:

• (i) the financial statements of the Company for the year ended 30 June 2008 being the last financial statements for a financial year of the Company lodged with the ASIC before the issue of this Prospectus;

• (ii) any half year financial year statements for the Company lodged with the ASIC since the lodgement of the last financial year statements for the year ended 30 June 2008 lodged with the ASIC before the issue of this Prospectus; and

• (iii) any document used to notify the ASX of information relating to the Company in the period from the lodgement of the financial statements referred to in paragraph a. above until the issue of the Prospectus in accordance with the Listing Rules as referred to in Section 674(1) of the Corporations Act.

Copies of all documents lodged with the ASIC in relation to the Company may be inspected at the registered office of the Company during normal business hours.

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The Company has lodged the following announcements with ASX since the lodgement of the audited financial statements for the year ended 30 June 2008:

DATE	DESCRIPTION
26 September 2008	Full year statutory accounts
20 October 2008	Notice of AGM
20 October 2008	Annual Report
30 October 2008	Appendix 4C – Quarterly Report
25 November 2008	Results of Meeting
28 January 2009	Appendix 4C – Quarterly Report
29 January 2009	Change of Director’s Interest
26 February 2009	Half Yearly Report and Accounts
29 April 2009	Appendix 4C – Quarterly Report
1 July 2009	Expiry of Unlisted Options
29 July 2009	Profit Announcement
29 July 2009	Appendix 4C – Quarterly Report
13 August 2009	Change of Director’s Interest Notice
13 August 2009	Change of Director’s Interest Notice
13 August 2009	Change of Director’s Interest Notice
13 August 2009	Change of Director’s Interest Notice
25 August 2009	Response to ASX Query
31 August 2009	Preliminary Final Report
9 September 2009	Non-Renounceable Issue

ASX maintains files containing publicly available information for all listed companies. The Company’s file is available for inspection at ASX during normal hours.

In addition, the following documents will be available for inspection for a period of 12 months after the date of issue of this Prospectus during normal business hours at the registered office of the Company:

• (a) this Prospectus;

• (b) the Constitution of the Company; and

• (c) the consents referred to in the Prospectus.

7.2 Underwriting Agreements

Pursuant to Underwriting Agreements dated 8 September 2009, Goldshore Investments Pty Ltd (ACN 113 152 819) (an associated entity of Mr Day), H R Moser & Associates (an associated entity of Mr Moser) and B Moore & T Endicott (Mr Moore being a Director of the Company) (collectively the Underwriters) have each agreed to underwrite one third of the Issue, up to a maximum of 306,796,528 Shares. The Underwriters’ respective several underwriting commitments (rounded down) are as follows:

Underwriter	Dollar Amount Underwritten	No. Of Shares Underwritten	Percentage of Total Amount Underwritten
Goldshore Investments Pty Ltd	$409,062.04	102,265,509	33.33%
H R Moser & Associates	$409,062.04	102,265,509	33.33%

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Underwriter	Dollar Amount Underwritten	No. Of Shares Underwritten	Percentage of Total Amount Underwritten
B Moore & T Endicott	$409,062.04	102,265,509	33.33%

Each Underwriter is a related party of the Company by virtue of being an entity associated with a Director.

The Underwriters will each be paid a fee of 6% of their respective proportion of the underwritten amount, subject to the terms and conditions of their respective Underwriting Agreements, which are on arms’ length commercial terms which are considered standard for agreements of this nature.

7.3 Legal Proceedings

At the date of this Prospectus the Company is involved in the following legal proceeding:

In a matter being heard in the Supreme Court of Western Australia, Adultshop.com Limited vs Teo Tran, the Company was awarded $737,000 on 7 March 2008 plus costs. Costs of $204,000 remain unpaid to the Company with the defendant awaiting the court’s decision on an appeal.

7.4 Interests and Consents of Advisers

Advanced Share Registry Limited has given its written consent to being named in the Corporate Directory in section 1 of this Prospectus as the Company’s Share Registry and has not withdrawn its consent to being named in this Prospectus prior to lodgement of this Prospectus with the ASIC.

Goldshore Investments Pty Limited (an entity associated with Mr Malcolm Day, a Director), H R Moser & Associates and Bradley Moore & Tanya Endicott have given their written consent to being named throughout this Prospectus as Underwriters to the Issue and have not withdrawn their consent to being named in this Prospectus prior to lodgement of this Prospectus with the ASIC.

For the purposes of Section 716 of the Corporations Act, notwithstanding that it may be referred to elsewhere in this Prospectus, neither Advanced Share Registry Limited, Goldshore Investments Pty Ltd, H R Moser & Associates nor Bradley Moore & Tanya Endicott were involved in the preparation of any part of this Prospectus, have caused the issue of this Prospectus and do not accept any liability to any person in respect of any false or misleading statement in, or omission from, any part of this Prospectus.

7.5 Expenses of the Issue

The estimated expenses of the Issue are:

The estimated expenses of the Issue are:
ASIC lodgement fee Share registry fees Prospectus printing and distribution Underwriting fees ASX listing fees Legal Expenses & Consulting fees *	$ 2,010 8,000 8,500 73,669 7,786 10,000
	109,965

• Note - A fee of $5,000 plus GST will be paid to entity associated with Mr Moore, a Director of the Company, for services rendered in assistance with the preparation of documentation in relation to the Issue.

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7.6 Market Price of Shares

The Company is a disclosing entity for the purposes of the Corporations Act and its Shares are enhanced disclosure securities quoted on ASX.

The highest and lowest market sale prices of the Company's Shares on ASX during the 3 months immediately preceding the date of lodgement of this Prospectus with the ASIC and the respective dates of those sales were:

Highest: $0.009 per Share on 15 September 2009 Lowest: $0.006 per Share on 9 July 2009

The latest available closing sale price of the Company's Shares on ASX prior to the lodgement of this Prospectus with the ASIC was $0.008 per Share on 15 September 2009.

7.7

Electronic Prospectus

Pursuant to Class Order 00/044, the ASIC has exempted compliance with certain provisions of the Corporations Act to allow distribution of an electronic prospectus and electronic application form on the basis of a paper prospectus lodged with the ASIC, and the publication of notices referring to an electronic prospectus or electronic application form, subject to compliance with certain conditions.

If you have received this Prospectus as an electronic prospectus, please ensure that you have received the entire Prospectus accompanied by the Entitlement and Acceptance Form. If you have not, please phone the Company and the Company will send you, for free, either a hard copy or a further electronic copy of the Prospectus, or both.

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 Entitlement and Acceptance Form, it was not provided together with the electronic copy of the Prospectus and any relevant supplementary or replacement prospectus or any of those documents were incomplete or altered.

7.8 Shareholder Details and Directors’ Interests

The following shareholder details are as notified to the Company as at 15 September 2009:

• (a) Substantial Shareholder

• Malcolm Day 44,147,859Shares

• (b) Distribution (as at 15 September 2009)

No. of Shares	No. of Shareholders	No. of Shareholders	Options 3 January 2012 ($0.047)	Options 3 January 2012 ($0.047)	Options 3 January 2012 ($0.067)	Options 3 January 2012 ($0.087)
1 – 1,000		652
1,001 – 5,000		751
5001 – 10,000		376
10,001 – 100,000		733		34	34	34
100,001 – over		199 2,711		1 35	1 35	1 35

As at the date of this Prospectus, the percentage of holdings of the twenty largest shareholders is 67.1%.

• (c) Directors' Interests

Except as set out below or elsewhere in this Prospectus, no Director has, or during the last two years has had, any interest in the formation or promotion of the Company, or

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any property proposed to be acquired by the Company in connection with its formation or promotion, and no Director is (or was during the last 2 years) a partner of or has (or during the last 2 years had) any beneficial interest in a firm which has (or during the last 2 years had) any interest in the promotion of or any property proposed to be acquired by the Company in connection with its promotion. Further, no sums had been paid or agreed to be paid to a Director or to such firm, in cash or shares or otherwise, either to induce him to become, or to qualify him as, a Director or otherwise for services rendered by him or the firm in connection with the promotion of the Company.

B Moore & T Endicott < ATF The Moore Family Trust>, an entity associated with Mr Moore, a Director of the Company, will be paid a fee of $5,000 plus GST, for services rendered in assistance with the co-ordination and preparation of documentation in respect to this Issue.

The relevant interests of the Directors in Shares and Options as at the date of this Prospectus are:

Name	Shares	Options
K Heitman	-	-
M Day	44,147,859	-
B Moore	-	-
H Rudolf-Moser	1,500,000	-

The Constitution of the Company provides that the non executive Directors may be paid for their services as Directors, a sum not exceeding such fixed sum per annum as may be determined by the Company in general meeting, to be divided among the Directors and in default of agreement then in equal shares. The Company paid to the Directors a total of $213,658 for the year ended 30 June 2009 and $237,820 for the year ended 30 June 2008. In addition, the Directors have accrued fees of $41,970 up until the date of this Prospectus. Directors, and companies associated with Directors, are reimbursed for all reasonable out of pocket expenses properly incurred in the course of conducting their duties which include, but are not in any way limited to, out of pocket expenses, travelling expenses, disbursements mad on behalf of the Company and other miscellaneous expenses.

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8. DEFINED TERMS

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

“ASIC” means Australian Securities and Investments Commission. “ASX” means ASX Limited (ACN 008 624 691) or the financial market operated by it, as the context requires. "Business Day" has the meaning ascribed to that term in the Listing Rules. "Closing Date" means the closing date for acceptances, as specified in the timetable in section 2.1 of this Prospectus, or such other date as determined by the Directors at their absolute discretion. "Company" means Adultshop.com Limited (ACN 009 147 924). "Corporations Act" means the Corporations Act 2001 (Cth). "Directors" means the directors of the Company at the date of this Prospectus. “Issue” means a non-renounceable entitlement issue of 2 Shares and 1 free attaching Option in the capital of the Company for every 2 Ordinary Shares held as at the Record Date at an issue price of $0.004 per Share.

"Listing Rules" means the Official Listing Rules of the ASX. "Official List" means the Official List of the ASX. “Official Quotation” means quotation of the Company’s securities on the Official List of the ASX.

“Option(s)” means an option to acquire a Share exercisable at $0.008 on or before 31 December 2011.

“Ordinary Share(s)” means ordinary shares in the capital of the Company irrespective of whether they are fully paid or partly paid shares, unless otherwise specified.

"Prospectus" means this Prospectus that the Company has issued for the purpose of a Non-Renounceable Entitlement Issue.

“Record Date” means the date for determining Shareholder entitlements, as specified in the timetable in section 2.1 of this Prospectus. “Securities” means Ordinary Shares and Options. "Share(s)" ordinary fully paid share in the capital of the Company. “Shareholder(s)” means holders of Ordinary Shares.

“Shortfall” means those Shares under the Issue not applied for by Shareholders under their entitlement.

• “Underwriters”

“WST”

means Goldshore Investments Pty Ltd; H R Moser & Associates and B Moore & T Endicott, each entity of which has agreed to underwrite one third of the Issue.

means Australian Western Standard Time.

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9. DIRECTORS’ CONSENT

Each of the Directors of Adultshop.com Limited has consented the lodgement of this Prospectus with the ASIC in accordance with Section 720 of the Corporations Act.

Dated 16 September 2009

Signed for and on behalf of Adultshop.com Limited Malcolm Day Managing Director

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OPTION EXERCISE FORM

ADULTSHOP.COM LIMITED

ACN 009 147 924

NOTICE OF EXERCISE OF OPTIONS Participant

Number:

Holder Identification Number: Security Holder Reference Number:

To the Directors

I/We........................................................................................................................am/are the registered holder(s) of Options. I/We exercise my/our Options to subscribe for ........................................................Shares in the capital of the Company. I/We enclose application moneys of $.........................................................calculated at $0.008 per Share.

I/We agree to be bound by the Constitution of the Company.

==> picture [463 x 216] intentionally omitted <==

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

I/We request registration as the holder(s) of the Shares on the register.
My/our address to be shown on the register is
........................................................................................................................................................
Affix Seal if
required by
DATED the .......................... day of ............................................ 20_ _ Constitution
Signed
...................................................... ....................................................... .....................................................
Holder 1 Holder 2 Holder 3
.......................................................................... ................................................. ................................................
Sole Director and Sole Company Secretary Director Company Secretary
----- End of picture text -----

General Signing Instructions:

In case of joint Option holders each Option holder must sign. Where the Option holder is an incorporated body, this document must be executed in accordance with its Constitution and any replaceable rules that apply. Directors and officers must sign in their capacity as provided above. If this form has been signed by an Attorney and the relative Power of Attorney has not already been produced by the Company, a certified copy of such Power of Attorney must be forwarded with this form for noting.

Share Registry: Advanced Share Registry Limited, PO Box 1156, NEDLANDS WA 6909 Tel: (08) 9389 8033 Fax: (08) 9389 7871

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ENTITLEMENT AND ACCEPTANCE FORM

THIS DOCUMENT IS IMPORTANT. IF YOU ARE IN DOUBT AS TO HOW TO DEAL WITH IT, PLEASE CONTACT YOUR STOCKBROKER OR LICENSED PROFESSIONAL ADVISER.

ADULTSHOP.COM LIMITED

ACN 009 147 924

REGISTERED OFFICE 118 Roe Street NORTHBRIDGE WA 6003

SHARE REGISTRY Advanced Share Registry Limited PO Box 1156 NEDLANDS WA 6909

Holder Identification Number: Entitlement No: Sub-Register:

Shareholding Entitlement to new Amount Payable at at 5.00 pm Shares $0.004 per new Share

on 21 September 2009 on a 1:1 basis

x x $x.xx

Non-renounceable entitlement issue of up to approximately 306,796,528 Shares and 153,398,264 free attaching Options on the basis of 2 Shares and 1 free attaching Option for every 2 existing Ordinary Shares held by Shareholders registered at 5:00pm WST on 25 September 2009 at an issue price of $0.004 per Share, payable in full upon application. The Closing Date for acceptances is 5:00 pm WST on 16 October 2009.

To the Directors ADULTSHOP.COM LIMITED

1. I/We the above mentioned, being registered on 25 September 2009 as the holder(s) of Ordinary Shares in the Company hereby accept the below mentioned Shares and free attaching Options issued in accordance with the enclosed Prospectus;

2. I/We enclose my/our cheque made payable to ADULTSHOP.COM LIMITED – RIGHTS ISSUE A/C, for the amount shown being payment at the rate of $0.004 per Share;

3. I/We hereby authorise you to place my/our name(s) on the registers of Share and Option holders in respect of the number of Shares and Options allotted to me/us and;

4. I/We agree to be bound by the Constitution of the Company.

RETURN OF THIS DOCUMENT WITH THE REQUIRED REMITTANCE WILL CONSTITUTE YOUR ACCEPTANCE OF THE SECURITIES BEING OFFERED

==> picture [475 x 253] intentionally omitted <==

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

||||||
|---|---|---|---|---|
|Shares Accepted|Amount Enclosed at $0.004 per new Share|
|PLEASE|Drawer|Bank|Branch|Amount|
|ENTER|
|CHEQUE|
|DETAILS|
|THANKYOU|
|My/Our contact numbers in the case of enquiry are:|
|Telephone ( ) . . . . . . . . . . . . . . . . . . . . . . . . .|Fax ( ) . . . . . . . . . . . . . . . . . . . . . . . . .|
|NOTE:|Cheques should be made payable to ADULTSHOP.COM LIMITED – RIGHTS ISSUE A/C, crossed “NOT NEGOTIABLE”|
|and forwarded to Advanced Share Registry Limited, PO BOX 1156, NEDLANDS Western Australia 6909 to arrive no|
|later than 5.00pm WST on 16|October 2009.|
|Complete this panel and sign below only if a change of address is to be registered with the Company|
|New Address: . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .|
|. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .|
|Signature(s): . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Date: . . . . . . . . . . . . . . . .|
|Please indicate your correct title : Director / Secretary|/ .................................|

----- End of picture text -----

ISSUE CLOSES AT 5.00PM WST ON 16 OCTOBER 2009

THE DIRECTORS RESERVE THE RIGHT TO MAKE AMENDMENTS TO THIS FORM WHERE APPROPRIATE PLEASE REFER OVERLEAF FOR INSTRUCTIONS

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EXPLANATION OF ENTITLEMENT

1. The front of this form sets out the number of Shares which you are entitled to accept.

2. Your entitlement may be accepted either in full or in part. There is no minimum acceptance.

3. The price payable on acceptance of each Share is $0.004.

4. You may accept your entitlement by completing the Entitlement and Acceptance Form overleaf.

APPLICATION INSTRUCTIONS

1. The issue price of $0.004 per Share is payable in full upon application.

2. Payments must be made in Australian currency by cheque or bank draft drawn on and payable at a bank within Australia. Cheques or bank drafts drawn on banks outside Australia in either Australian currency or in foreign currency will not be accepted.

3. The cheques must be made payable to Adultshop.com Limited – Rights Issue A/C and crossed “Not Negotiable”.

4. When completed, this form together with the appropriate payment in Australian currency should be forwarded to ADULTSHOP.COM LIMITED, c/- Advanced Share Registry Limited, PO BOX 1156, NEDLANDS WA 6909.

5. Acceptances must be received by Advanced Share Registry Limited by no later than 5.00pm WST on 16 October 2009.

ENQUIRIES

Any enquiries should be directed to:

The Company’s share registry: Advanced Share Registry Limited PO BOX 1156 NEDLANDS W.A. 6909

Telephone (08) 9389 8033

Facsimile (08) 9389 7871

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