XENITRA LIMITED — Capital/Financing Update 2021

Apr 5, 2021

Keong Chan Executive Chairman 6 April 2021

==> picture [77 x 56] intentionally omitted <==

AUMAKE LIMITED ACN 150 110 017

CLEANSING PROSPECTUS

For the offer of up to 100 New Options to be issued to participants in the March Placement ( Offer ).

This Prospectus has been prepared primarily for the purpose of section 708A(11) of the Corporations Act to remove any trading restrictions on the sale of New Options and Options in the same class as the New Options issued by the Company prior to the Closing Date.

IMPORTANT NOTICE

This document is important and should be read in its entirety. If after reading this Prospectus you have any questions about the New Options being offered under this Prospectus or any other matter, then you should consult your stockbroker, accountant or other professional adviser.

The New Options offered under this Prospectus should be considered speculative.

TABLE OF CONTENTS

1.	CORPORATE DIRECTORY .............................................................................................. 1
2.	TIMETABLE AND IMPORTANT NOTES ............................................................................ 2
3.	DETAILS OF THE OFFER .................................................................................................. 4
4.	PURPOSE AND EFFECT OF THE OFFER ........................................................................... 7
5.	RIGHTS AND LIABILITIES ATTACHING TO NEW OPTIONS ............................................. 9
6.	RISK FACTORS ............................................................................................................ 13
7.	ADDITIONAL INFORMATION ...................................................................................... 19
8.	DIRECTORS’ AUTHORISATION .................................................................................... 27
9.	DEFINITIONS ............................................................................................................... 28

i

4344-07/2648268_1

1. CORPORATE DIRECTORY

Directors

Registered Office

Keong Chan Executive Chairman

Jiahua (Joshua) Zhou Managing Director

Suite 1.01 22-36 Mountain Street ULTIMO NSW 2007

ASX Code

Jacky Yang Executive Director

AUK

Lawyers

Quentin Flannery Non-Executive Director

Company Secretary

David Franks

Steinepreis Paganin Lawyers and Consultants Level 4 The Read Buildings 16 Milligan Street PERTH WA 6000

Share Registry*

Auditor*

Computershare Investor Services Pty Ltd Level 11 172 St Georges Tce PERTH WA 6000 +61 (08) 9323 2000 (Telephone)

RSM Australia Partners Level 32 Exchange Tower 2 2 The Esplanade PERTH WA 6000

1800 783 447 (Facsimile – within Australia) +61 3 9473 2555 (Facsimile – outside Australia)

• These entities have not been involved in the preparation of this Prospectus and have not consented to being named in this Prospectus. Their names are included for information purposes only.

1

2. TIMETABLE AND IMPORTANT NOTES

2.1 Timetable

Action	Date
Lodgement of Prospectus with ASIC and ASX	6 April 2021
Opening Date	7 April 2021
Closing Date*	5:00pm (AEST) 8 April 2021
Expected date of Official Quotation of the New Options *	8 April 2021

• The Directors reserve the right to bring forward or extend the Closing Date at any time after the Opening Date without notice.

** Quotation of the New Options is subject to the Company being able to satisfy ASX of the quotation requirements set out in Chapter 2 of the ASX Listing Rules.

2.2 Important Notes

This Prospectus is dated 6 April 2021 and was lodged with ASIC on that date. ASIC and its officers take no responsibility for the contents of this Prospectus or the merits of the investment to which this Prospectus relates.

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

The Offer is only available to those who are personally invited to accept the Offer. Applications for New Options offered pursuant to this Prospectus can only be submitted on an original Application Form which accompanies this Prospectus.

This Prospectus is a transaction specific prospectus for an offer of New Options to acquire continuously quoted securities (as defined in the Corporations Act) and has been prepared in accordance with section 713 of the Corporations Act. It does not contain the same level of disclosure as an initial public offering 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.

2.3 Website

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

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

The Company reserves the right not to accept an Application Form from a person if it has reason to believe that when that person was given access to the electronic Application Form, it was not provided together with the electronic Prospectus and

2

any relevant supplementary or replacement prospectus or any of those documents were incomplete or altered.

2.4 Risk Factors

Potential investors should be aware that subscribing for New Options in the Company involves a number of risks. The key risk factors of which investors should be aware are set out in Section 6 of this Prospectus. These risks together with other general risks applicable to all investments in listed securities not specifically referred to, may affect the value of the New Options in the future. Accordingly, an investment in the Company should be considered highly speculative. Investors should consider consulting their professional advisers before deciding whether to apply for New Options pursuant to this Prospectus.

2.5

Overseas Investors

This Prospectus is only available in Australia. This Prospectus does not constitute an offer of New Options outside Australia. It would be unlawful to issue this Prospectus outside Australia.

2.6 Forward-looking statements

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

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

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

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

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

These forward looking statements are subject to various risk factors that could cause our actual results to differ materially from the results expressed or anticipated in these statements. These risk factors are set out in Section 6 of this Prospectus.

2.7

Disclaimer

No person is authorised to give any information or to make any representation in connection with the Offer described in this Prospectus which is not contained in this Prospectus. Any information not so contained may not be relied upon as having been authorised by the Company or any other person in connection with the Offer. You should rely only on information in this Prospectus.

3

3. DETAILS OF THE OFFER

3.1 Offer

Under this Prospectus, the Company invites investors identified by the Directors to apply for up to 100 New Options.

The Offer will only be extended to specific parties on invitation from the Directors. Application Forms will only be provided by the Company to these parties.

The full terms and conditions of the New Options to be offered under this Prospectus are set out in Section 5.1.

3.2 Objective

The Company is not seeking to raise any capital under this Prospectus and, accordingly, the purpose of this Prospectus is not to raise capital.

The purpose of this Prospectus is to remove any trading restrictions that may have attached to Options in the same class as the New Options issued by the Company without disclosure under Chapter 6D of the Corporations Act prior to the Closing Date (including prior to lodgement of this Prospectus) so that, following quotation of the Options in the same class as the New Options, any on-sale of Options in that class issued before the Closing Date does not breach section 707(3) of the Corporations Act.

Relevantly, section 708A(11) of the Corporations Act provides that a sale offer does not need disclosure to investors if:

• (a) the relevant securities are in a class of securities that are quoted securities of the body;

• (b) either:

• (i) a prospectus is lodged with the ASIC on or after the day on which the relevant securities were issued but before the day on which the sale offer is made; or

• (ii) a prospectus is lodged with ASIC before the day on which the relevant securities are issued and offers of securities that have been made under the prospectus are still open for acceptance on the day on which the relevant securities were issued; and

• (c) the prospectus is for an offer of securities issued by the body that are in the same class of securities as the relevant securities.

On 17 March 2021, the Company completed a two-tranche placement under which it issued Shares, together with free attaching Options, to sophisticated and professional investors ( March Placement ). The free attaching Options issued under the March Placement were in a new class of securities. The Company has placed a trading lock on all Options issued under the March Placement in order to prevent those Options being traded or on-sold to third parties until they are cleansed.

The New Options offered under this Prospectus are in the same class as those issued under the March Placement. Once this Prospectus has been lodged, and subject to ASX granting Official Quotation of the New Options under Chapters 1

4

and 2 of the Listing Rules, the Company will remove the trading lock on all Options in the same class as the New Options.

The Company will apply for quotation of the New Options within 7 days following the date of this Prospectus and the issue of New Options under the Offer is conditional upon ASX granting Official Quotation to the New Options.

3.3 Application for New Options

Applications for New Options must be made by investors at the direction of the Company and must be made using the Application Form accompanying this Prospectus.

The Company reserves the right to close the Offer early.

3.4 Minimum subscription

There is no minimum subscription.

3.5 Oversubscriptions

No oversubscriptions will be accepted by the Company.

3.6 Issue of New Options

As noted in Section 3.2, the primary purpose of the Offer is to remove any trading restrictions that may have attached to Options in the same class as the New Options issued by the Company without disclosure under Chapter 6D of the Corporations Act prior to the Closing Date of the Offer (including prior to the date of this Prospectus).

If the Directors decide to issue New Options under the Offer, the issue of New Options under the Offer will take place as soon as practicable after the Closing Date.

The Directors will determine the recipients of all the New Options. The Directors reserve the right to reject any application or to allocate any Applicant fewer New Options than the number applied for. The Company’s decision on the number of New Options to be allocated to an applicant will be final.

Holding statements for New Options issued under this Prospectus will be mailed to the investors under the Offer.

3.7 ASX listing

Application for Official Quotation of the New Options offered pursuant to this Prospectus and Options in the same class as the New Options will be made within 7 days of the date of this Prospectus. If ASX does not grant Official Quotation of the New Options offered pursuant to this Prospectus before the expiration of 3 months after the date of issue of the Prospectus, (or such period as varied by the ASIC), the Company will not issue any New Options and Options of the same class as the New Options will remain unquoted.

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

5

3.8 Restrictions on the distribution of the Prospectus

The distribution of this Prospectus outside the Commonwealth of Australia may be restricted by law.

This Offer does not, and is not intended to, constitute an offer in any place or jurisdiction in which, or to any person to whom, it would not be lawful to make such an offer or to issue this Prospectus.

Residents of countries outside Australia should consult their professional advisers as to whether any government or other consents are required, or whether any formalities need to be observed should they wish to make an application to take up New Options on the basis of this Prospectus. The return of a duly completed Application Form will be taken to constitute a representation and warranty that there has been no breach of such laws and that all approvals and consents have been obtained.

3.9

Enquiries

Any questions concerning the Offer should be directed to David Franks, Company Secretary, on +61 2 8098 1169.

6

4. PURPOSE AND EFFECT OF THE OFFER

4.1 Eligibility

Only participants in the March Placement will be eligible to apply for the New Options under the Offer. Accordingly, the Offer will only be extended to specific parties on invitation from the Directors and the Application Form will be provided by the Company to these parties only.

4.2 Effect of the Offer on capital structure

The effect of the Offer on the Company’s capital structure is set out below.

Shares	Number
Shares currently on issue	537,846,761
Shares offered under this Prospectus	-
**Total Shares on issue on completion of the Offer1 **	537,846,761

Notes:

1. This assumes no Options are exercised.

Options	Number
Unlisted Options exercisable at $0.20 each on or before 29 February 2022	5,000,000
Unlisted Options exercisable at $0.20 each on or before 22 January 2023	3,550,000
Unlisted Options exercisable at $0.20 each on or before 4 December 2024	33,600,000
Unlisted Loyalty Options exercisable at $0.20 each on or before 4 December 2024	1,300,000
Unlisted Long Term Options exercisable at $0.20 each on or before 4 December 2024	2,300,000
Listed Options exercisable at $0.14 each on or before 16 March 20241	58,333,364
New Listed Options offered under this Prospectus exercisable at $0.14 each on or before 16 March 20241,2	100
Total Options on issue on completion of the Offer3	104,083,464

Notes:

1. The rights and liabilities attaching to the Options are summarised in Section 5.1 of this Prospectus.

2. This assumes the Offer is fully subscribed, all New Options offered are issued and no New Options are exercised.

Performance Rights	Number
Performance Rights – Class A1	7,000,000
Performance Rights – Class B2	2,100,000
Performance Rights – Class C3	882,000
Short Term Performance Rights4	4,450,000

7

Performance Rights

Number

Performance Rights offered under this Prospectus - Total Performance Rights on issue on completion of the Offer[1 ] 14,432,000

Notes:

1. Refer to Annexure C of the Notice of Annual General Meeting released on the Company’s ASX platform on 29 October 2020 for the full terms and conditions of these Performance Rights.

2. Refer to Annexure D of the Notice of Annual General Meeting released on the Company’s ASX platform on 29 October 2020 for the full terms and conditions of these Performance Rights.

3. Refer to Annexure E of the Notice of Annual General Meeting released on the Company’s ASX platform on 29 October 2020 for the full terms and conditions of these Performance Rights.

4. These Performance Rights were issued under the Company’s Long Term Incentive Plan, which was adopted at the Company’s most recent AGM (refer to Annexure A of the Notice of Annual General Meeting released on the Company’s ASX platform on 29 October 2020).

4.3 Financial effect of the Offer

The Offer is being made at a price of $0.01 per New Option.

Refer to Section 7.8 of this Prospectus for further details relating to the estimated expenses of the Offer.

8

5. RIGHTS AND LIABILITIES ATTACHING TO NEW OPTIONS

5.1 New Options

The following is a summary of the terms and conditions of the New Options being offered pursuant to this Prospectus:

(a) Entitlement

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

(b) Exercise Price

Subject to paragraph (i), the amount payable upon exercise of each Option is $0.14 ( Exercise Price ).

(c) Expiry Date

Each Option will expire at 5:00 pm (AEDT) on 16 March 2024 ( Expiry Date ).

An Option not exercised before the Expiry Date will automatically lapse on the Expiry Date.

(d) Exercise Period

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

(e) Notice of Exercise

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

(f) Exercise Date

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

(g) Timing of issue of Shares on exercise

Within five Business Days after the Exercise Date, the Company will:

• (i) issue the number of Shares required under these terms and conditions in respect of the number of Options specified in the Notice of Exercise and for which cleared funds have been received by the Company;

• (ii) if required, give ASX a notice that complies with section 708A(5)(e) of the Corporations Act, or, if the Company is unable to issue such a notice, lodge with ASIC a prospectus prepared in accordance with the Corporations Act and do all such things necessary to satisfy section 708A(11) of the Corporations Act to

9

ensure that an offer for sale of the Shares does not require disclosure to investors; and

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

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

(h)

Shares issued on exercise

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

(i)

Reconstruction of capital

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

(j)

Participation in new issues

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

• (k)

Change in exercise price

An Option does not confer the right to a change in Exercise Price or a change in the number of underlying securities over which the Option can be exercised.

• (l)

Transferability

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

5.2 Shares

The following is a summary of the more significant rights and liabilities attaching to Shares that may be issued pursuant to this Prospectus and subject to exercise of the New Options. This summary is not exhaustive and does not constitute a definitive statement of the rights and liabilities of Shareholders. To obtain such a statement, persons should seek independent legal advice.

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

10

(a) General meeting and notices

Each member 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 sent to members under the Constitution, the Corporations Act or the ASX Listing Rules.

(b) 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 the Company every holder of fully paid ordinary shares present in person or by an attorney representative or proxy has one vote on a show of hands and one vote per share on a poll.

Where there are 2 or more joint holders of a share and more than one of them is present at a meeting and tenders a vote in respect of the share, the Company will count only the vote cast by the member whose name appears first in the Company's register of members.

(c) Issues of further Shares

The Directors may, on behalf of the Company, issue, grant options over unissued shares to any person on the terms, with the rights, and at the times that the Directors decide. However, the Directors must act in accordance with the restrictions imposed by the Constitution, ASX Listing Rules, the Corporations Act and any rights for the time being attached to the shares in any special class of those shares.

(d) Variation of Rights

Unless otherwise provided by the terms of issue of a class of shares and subject to the Corporations Act, the rights attached to the shares in any class may be varied or cancelled only with the written consent of the holders of at least three-quarters of the issued shares of the affected class, or by special resolution passed at a separate meeting of the holders of the issued shares of the affected class.

(e) Transfer of Shares

Subject to the Constitution, the Corporations Act and ASX Listing Rules, Shares are freely transferable.

The Shares may be transferred by a proper transfer effected in accordance with the ASX Settlement Operating Rules, by any other method of transferring or dealing with Shares introduced by ASX and as otherwise permitted by the Corporations Act or by a written instrument of transfer in any usual form or in any other form approved by either the Directors or ASX that is permitted by the Corporations Act.

The Directors may decline to register a transfer of Shares (other than a proper transfer in accordance with the ASX Settlement Operating Rules) where permitted to do so under the ASX Listing Rules. If the Directors decline to register a transfer, the Company must, within 5 Business Days after the transfer is delivered to the Company, give the party lodging the transfer written notice of the refusal and the reason for the refusal. The Directors must decline to register a transfer of Shares when required by law, by the ASX Listing Rules or by the ASX Settlement Operating Rules.

11

(f) Dividends

The Directors may from time to time determine dividends to be distributed to members according to their rights and interests. The Directors may fix the time for distribution and the methods of distribution. Subject to the terms of issue of shares, the Company may pay a dividend on one class of shares to the exclusion of another class.

Each share carries the right to participate in the dividend in the same proportion that the amount for the time being paid on the share (not credited) bears to the total amounts paid and payable (excluding amounts credited) in respect of such shares.

(g) Dividend reinvestment and Share plans

Subject to the requirements in the Corporations Act and the ASX Listing Rules, the Directors may implement and maintain dividend reinvestment plans (under which any member may elect that dividends payable by the Company be reinvested by way of subscription for fully paid shares in the Company).

(h) Capitalisation of profits

Subject to the ASX Listing Rules and any rights or restrictions attaching to any class of shares, the Company may capitalise profits. Members are entitled to participate in a capital distribution in the same proportions in which they are entitled to participate in dividends.

(i) Winding-up

Subject to the rights of holders of shares with special rights in a windingup and the Corporations Act, if the Company is wound up all monies and property that are to be distributed among Shareholders on a winding-up, shall be distributed in proportion to the Shares held by them respectively, irrespective of the amount paid-up or credited as paid-up on the Shares.

(j) Shareholder liability

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

(k) Alteration of constitution

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

12

6. RISK FACTORS

6.1 Introduction

The New Options offered under this Prospectus are considered highly speculative. An investment in the Company is not risk free and the Directors strongly recommend potential investors to consider the risk factors described below, together with information contained elsewhere in this Prospectus and to consult their professional advisers before deciding whether to apply for New Options pursuant to this Prospectus.

There are specific risks which relate directly to the Company’s business. In addition, there are other general risks, many of which are largely beyond the control of the Company and the Directors. The risks identified in this Section, or other risk factors, may have a material impact on the financial performance of the Company and the market price of the New Options.

The following is not intended to be an exhaustive list of the risk factors to which the Company is exposed.

6.2 Coronavirus (COVID-19)

The outbreak of the coronavirus disease (COVID-19) is impacting global economic markets. The nature and extent of the effect of the outbreak on the performance of the Company remains unknown. The Company’s Share price may be adversely affected in the short to medium term by the economic uncertainty caused by COVID-19. Further, any governmental or industry measures taken in response to COVID-19 may adversely impact the Company’s operations and are likely to be beyond the control of the Company.

The Directors are monitoring the situation closely and have considered the impact of COVID-19 on the Company’s business and financial performance. However, the situation is continually evolving, and the consequences are therefore inevitably uncertain. In compliance with its continuous disclosure obligations, the Company will continue to update the market in regard to the impact of COVID 19 on its revenue channels and any adverse impact on the Company. If any of these impacts appear material prior to close of the Offer, the Company will notify investors under a supplementary prospectus.

6.3 Company specific

(a) Brand and Reputation

The Company’s key business assets include brand names and related intellectual property of the business. A number of factors may adversely affect these key business assets, including:

• (i) potential disputes or litigation with suppliers, customers, employees or other third parties;

• (ii) adverse media coverage (including social media);

• (iii) failure to deliver products which meet customer expectations; and

• (iv) other risks to the Company’s brand names and intellectual property which are beyond the Company’s control.

13

These factors can erode the Company’s public reputation and adversely affect the Company’s supply streams by decreasing demand for the Company’s products and causing interference with key supply relationships, distributors and employees. Cumulatively this could detrimentally affect the value associated with the Company’s business.

(b) Change in Regulation

There is a continuing risk for the Company that local laws and/or regulations in Australia and China with respect to the operation of its customers may change. There is a risk that changes to the regulatory environment may materially detrimentally affect the way the Company currently operates (including obligations altering the manufacturing processes, ingredients, shelf life, marketing and export/import processes).

The potential detrimental flow on effects from these regulatory changes could significantly affect the sale or production of the Company’s products as a result of:

• (i) regulatory changes which restrict or entirely prevent access to particular markets in which the Company may source its products (amendments to importation or exportation regulations);

• (ii) regulatory changes which change the product packaging requirements and disclosure obligations (including labelling and country of origin requirements containing minimum dietary disclosures); or

• (iii) the introduction of taxation measures which specifically reference food items.

The Company is not aware of any current issues or any impending regulatory changes in Australia which may affect its supply, manufacture and distribution networks. However, there is a continuing residual risk from potential regulatory changes, particularly in China, which may materially alter the Company’s revenues and/or increase its costs which could diminish the Company’s financial performance.

(c) Supply

The Company relies on a number of suppliers and manufacturers with respect to its product range. Risks in respect of supply and manufacturing hinges upon the Company’s reliance on a concentration and consistency of key suppliers and manufacturers.

A disruption to this supply chain, or if a manufacturer chooses to discontinue production, could adversely affect the Company’s ability to meet consumer needs and ultimately be of detriment to the business's financial performance and future prospects. However, given that there are alternative suppliers and manufacturers within Australia that the Company could seek to partner with, the Company considers it low risk.

(d) Competition

The Company’s future financial performance and overall success in the market will rest upon the successful implementation of strategies to compete with other businesses. Some of these competitors have

14

advantageous access to capital and resources. Those competitors may be given both financial and marketing assistance.

The Company’s strategies may be adversely impacted by the number and size of its competitors who may participate in the market with a more aggressive pricing structure, innovative technologies and/or agile supply and distribution networks more adept than those of the Company.

(e) Failure to grow

The success and potential growth of the Company is dependent on its ability to grow its store footprint and to source/offer a wide range of products to the market. If the Company is unable to do so, the result could be a reduced or negative rate of growth. The Company may also fail to grow as a result of inadequate marketing or insufficient consumer interest.

(f) Reliance on key personnel

The development of the Company has been largely due to the effort, experience and leadership of its management team. The Company is also dependent on the continued service of its existing development personnel because of the complexity of its technologies. Despite the Company’s best efforts to attract and retain key personnel, there is no assurance that the Company will be able to retain the services of such persons. The Company’s ability or inability to attract and retain key personnel could have a material effect upon the Company’s business, results of operations and financial condition.

(g) Dependence on outside parties

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

Given the highly concentrated nature of Australia’s ‘daigou’ retail market, disruption by any of the major retailers in the Coles-Wesfarmers or Woolworths Group could have a material adverse impact on the Company’s financial performance. The Company is focused on expanding its distribution footprint to mitigate this risk, as well as to benefit from margin accretive opportunities available outside Australia.

(h) Product contamination and recall

Being a distributor of food products, the Company is subject to a risk of product contamination and/or product recall that could have a material adverse effect on the Company’s brand and stock levels and thereby its financial performance and future prospects.

(i) Management of growth

There is a risk that management of the Company will not be able to implement its growth strategy. The capacity of the Company’s

15

management to properly implement the strategic direction of the Company may affect the Company’s financial performance.

As part of its business strategy, the Company may make acquisitions of, or significant investments in, additional complementary companies or prospects. Any such transactions will be accompanied by risks commonly encountered in making such acquisitions.

6.4 General Risks

(a) Additional requirements for capital

The funds raised under the December Placement are considered sufficient to meet the immediate business objectives of the Company. Additional funding may be required in the event costs exceed the Company’s estimates and to effectively implement its business and operations plans in the future, to take advantage of opportunities for acquisitions, joint ventures or other business opportunities and to meet any unanticipated liabilities or expenses which the Company may incur.

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

Loan agreements and other financing rearrangements such as debt facilities, convertible note issues and finance leases (and any related guarantee and security) that may be entered into by the Company may contain covenants, undertakings and other provisions which, if breached, may entitle lenders to accelerate repayment of loans and there is no assurance that the Company would be able to repay such loans in the event of an acceleration. Enforcement of any security granted by the Company or default under a finance lease could also result in the loss of assets.

(b) Trading price of Shares

The Company’s operating results, economic and financial prospects and other factors will affect the trading price of the Shares. In addition, the price of Shares is subject to varied and often unpredictable influences on the market for equities, including, but not limited to general economic conditions including, inflation rates and interest rates, variations in the general market for listed stocks, changes to government policy, legislation or regulation, industrial disputes, general operational and business risks and hedging or arbitrage trading activity that may develop involving the Shares.

The share prices for many companies have been and may in the future be highly volatile, which in many cases may reflect a diverse range of non-company specific influences such as global hostilities and tensions relating to certain unstable regions of the world, acts of terrorism and the general state of the global economy. No assurances can be made that

16

the Company’s market performance will not be adversely affected by any such market fluctuations or factors.

(c) Potential acquisitions risk

As part of its business strategy, the Company may make acquisitions of, or significant investments in, complementary companies or prospects although no such acquisitions or investments are currently planned. Any such transactions will be accompanied by risks commonly encountered in making such acquisitions.

(d) Market conditions risk

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

• (i) general economic outlook;

• (ii) interest rates and inflation rates;

• (iii) currency fluctuations;

• (iv) changes in investor sentiment towards particular market sectors;

• (v) the demand for, and supply of, capital; and

• (vi) terrorism or other hostilities.

The market price of Shares can fall as well as rise and may be subject to varied and unpredictable influences on the market for equities in general and technology stocks in particular.

(e) General economic and political risks

Changes in the general economic and political climate in Australia and on a global basis may impact on economic growth, interest rates, the rate of inflation, taxation and tariff laws, domestic security which may affect the value and viability of any activities that may be conducted by the Company.

(f)

Regulatory risk

Changes in relevant taxes, legal and administration regimes, accounting practice and government policies may adversely affect the financial performance of the Company.

6.5 Speculative investment

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

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

17

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

18

7. ADDITIONAL INFORMATION

7.1 Litigation

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

7.2

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 a “transaction specific prospectus” is only required to contain information in relation to the effect of the issue of securities on the Company and the rights attaching to the 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 ASX and does not include all of the information that would be included in a prospectus for an initial public offering of securities 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 enquires as are reasonable, the Company believes that it has complied with the general and specific requirements of ASX as applicable from time to time throughout the 3 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 ASX.

Information that is already in the public domain has not been reported in this Prospectus other than that which is considered necessary to make this Prospectus complete.

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 annual financial report most recently lodged by the Company with the ASIC;

19

• (ii) any half-year financial report lodged by the Company with the ASIC after the lodgement of the annual financial report referred to in (i) and before the lodgement of this Prospectus with the ASIC; and

• (iii) any continuous disclosure documents given by the Company to ASX in accordance with the ASX Listing Rules as referred to in section 674(1) of the Corporations Act after the lodgement of the annual financial report referred to in (i) and before the lodgement of this Prospectus with the ASIC.

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

Details of documents lodged with ASX since the date of lodgement of the Company’s latest annual financial report and before the lodgement of this Prospectus with the ASIC are set out in the table below :

Date	Description of Announcement
31 March 2021	Investor presentation - ConsumerOpps virtual conference
29 March 2021	Business update – Social e-commerce marketplace
26 March 2021	Aumake to present at ConsumerOpps virtual conference
17 March 2021	Completion of Placement Tranche 2
17 March 2021	Change of Director's Interest Notice - JZ
17 March 2021	Change of Director's Interest Notice - JY
17 March 2021	Change of Director's Interest Notice - KC
17 March 2021	Change of Director's Interest Notice - QF
17 March 2021	Becoming a substantial holder - Ilwella
17 March 2021	Cleansing Notice
17 March 2021	Appendix 2A - Options
17 March 2021	Appendix 2A - Shares
12 March 2021	Results of Extraordinary General Meeting
18 February 2021	1H FY21 Results Summary
18 February 2021	Appendix 4D and Half Year Financial Report
15 February 2021	Trading Update
10 February 2021	Cover Letter and Proxy Form re Extraordinary General Meeting
10 February 2021	Notice of Extraordinary General Meeting and Proxy Form
25 January 2021	Quarterly Activity Report & Appendix 4C
13 January 2021	Change of Director's Interest Notice - QF
7 January 2021	Ceasing to be a substantial holder - KC
7 January 2021	Change in substantial holding - JZ

20

Date	Description of Announcement
7 January 2021	Cleansing Notice
7 January 2021	Appendix 2A
7 January 2021	Proposed issue of Securities - AUK
30 November 2020	Constitution
30 November 2020	Results of Meeting
30 November 2020	Chairman’s Address to Shareholders
12 November 2020	Active users and GMV trading update
29 October 2020	Cover letter and Proxy Form re Annual General Meeting
29 October 2020	Notice of Annual General Meeting and Proxy Form
28 October 2020	September 2020 Quarterly Activity Report
28 October 2020	Appendix 4C - quarterly
26 October 2020	Final Director’s Interest Notice - OH
26 October 2020	Director Resignation
12 October 2020	AuMake to present at TechOpps virtual investment conference
8 October 2020	Investor Presentation
8 October 2020	New online platform and social e-commerce marketplace
5 October 2020	Date of Annual General Meeting
5 October 2020	Appendix 2A
25 September 2020	Release of securities from escrow
31 August 2020	Full Year Results FY20
31 August 2020	Appendix 4G and Corporate Governance Statement
31 August 2020	FY2020 Annual Report and Appendix 4E

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

The announcements are also available through the Company’s website at www.aumake.com.au.

7.3 Market price of New Options

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

There is currently no market for the New Options and the Options in the same class as the New Options. However, the Company will apply for Official Quotation of the New Options within 7 days following the date of this Prospectus.

The highest, lowest and last market sale prices of the Shares on ASX during the three months immediately preceding the date of lodgement of this Prospectus with the ASIC and the most recent dates of those sales were:

21

	Price	Date
Highest	$0.0690	24 December 2020
Lowest	$0.0400	15 March 2021
Last	$0.0410	6 April 2021

7.4 Details of substantial holders

Based on publicly available information as at 6 April 2021, those persons which (together with their associates) have a relevant interest in 5% or more of the Shares on issue are set out below:

Shareholder	Shares	%
Mr Jiahua Zhou ATF Discretionary A/C>1	62,560,672	11.63%
Ilwella Pty Ltd2	29,448,332	5.48%

Notes:

1. Director, Mr Zhou is a substantial holder of the Company. Please refer to section 7.5 for further details.

2. Comprising 21,569,444 Shares held by Ilwella Pty Ltd, 2,737,500 Shares held by Brian Flannery, 2,737,500 Shares held by Peggy Flannery and 2,403,888 Shares held by Maximus Flannery Pty Ltd.

7.5 Directors’ Interests

Other than as set out below or elsewhere in this Prospectus, no Director of the Company, has or had within 2 years before the lodgement of this Prospectus with the ASIC, any interest in:

• (a) the formation or promotion of the Company;

• (b) property acquired or proposed to be acquired by the Company in connection with:

• (i) its formation or promotion; or

• (ii) the Offer; or

• (c) the Offer,

and no amounts have been paid or agreed to be paid and no benefits have been given or agreed to be given to a Director of the Company:

• (d) as an inducement to become, or to qualify as, a director of the Company; or

• (e) for services provided in connection with:

• (i) the formation or promotion of the Company; or

• (ii) the Offer.

22

Security holdings

The interest of each of the Directors in the securities of the Company as at the date of this Prospectus is set out in the table below.

Director	Shares	Options	Performance Rights
Keong Chan	26,793,3761	11,333,3332	2,187,5003
Jiahua Zhou	62,560,6724	8,516,6665	1,687,5006
Quentin Flannery	29,448,3327	9,166,6668	2,100,0009
Jacky Yang	7,865,99710	15,833,33311	3,125,0006

Notes:

1. Held indirectly through Ms Liesl Chan ATF .

2. Comprising 10,500,000 Options exercisable at $0.20 each on or before 4 December 2024 and 833,333 Options exercisable at $0.14 each on or before 16 March 2024 (all held indirectly through Ms Liesl Chan ATF ).

3. Class A Performance Rights held indirectly through Ms Liesl Chan ATF .

4. Refer to Section 7.4 for further details of Mr Zhou’s interest.

5. Comprising 8,100,000 Options exercisable at $0.20 each on or before 4 December 2024 and 416,666 Options exercisable at $0.14 each on or before 16 March 2024.

6. Class A Performance Rights.

7. Comprising 21,569,444 Shares held indirectly through Ilwella Pty Ltd (of which Quentin Flannery is a director and Brian Joseph Flannery and Peggy Ann Flannery are the shareholders), 2,403,888 Shares held indirectly through Maximus Flannery Pty Ltd (of which Quentin Flannery is the sole director and shareholder), 2,737,500 Shares held through Brian Joseph Flannery and 2,737,500 Shares held through Peggy Ann Flannery.

8. Comprising 4,166,666 Options exercisable at $0.14 each on or before 16 March 2024 (held indirectly through Ilwella Pty Ltd) and 5,000,000 Options exercisable at $0.20 each on or before 29 September 2022 (held indirectly through Maximus Flannery Pty Ltd ATF Finco Investment Trust).

9. Class B Performance Rights held indirectly through Ilwella Pty Ltd.

10. Comprising 3,831,144 Shares and 4,034,853 Shares under voluntary escrow until 23 July 2022.

11. Comprising 15,000,000 Options exercisable at $0.20 each on or before 4 December 2024 and 833,333 Options exercisable at $0.14 each on or before 16 March 2024.

Remuneration

The Constitution and the ASX Listing Rules specify that the aggregate remuneration of non-executive directors shall be determined from time to time by a general meeting. An amount not exceeding the amount determined is then divided between the directors as agreed. The maximum aggregate remuneration for non-executive Directors has been set at $500,000. The Board has not formally engaged the services of the remuneration consultant to provide recommendations when setting the remuneration received by key management personnel during the financial year.

In addition, a Director may be paid fees or other amounts as the Directors determine where a Director performs special duties or otherwise performs services outside the scope of the ordinary duties of a Director.

23

The table below shows the total annual remuneration paid to both executive and non-executive Directors in each of the past two financial years and the proposed remuneration for the current financial year.

Director	30 June 2019	30 June 2020	30 June 2021 (Proposed)
Keong Chan	$262,0541	$217,6732	$327,0253
Jiahua Zhou	$297,7884	$247,3565	$305,1256
Quentin Flannery	$48,0007	$40,0008	$48,0009
Jacky Yang10	-	$186,00011	$282,87512

Notes:

1. Comprising fees of $241,154 and post-employment benefits of $20,900.

2. Comprising fees of $200,256 and post-employment benefits of $17,417.

3. Comprising fees of $305,175 and post-employment benefits of $21,850.

4. Comprising fees of $274,038 and post-employment benefits of $23,750.

5. Comprising fees of $227,564 and post-employment benefits of $19,792.

6. Comprising fees of $286,363 and post-employment benefits of $18,763.

7. Representing director fees of $48,000.

8. Representing director fees of $40,000.

9. Representing director fees of $48,000.

10. Mr Yang was appointed on 18 November 2019.

11. Comprising fees of $171,581 and post-employment benefits of $14,419.

12. Comprising fees of $266,250 and post-employment benefits of $16,625.

7.6 Interests of experts and advisers

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

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

• (b) promoter of the Company; or

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

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

• (d) the formation or promotion of the Company;

• (e) any property acquired or proposed to be acquired by the Company in connection with:

• (i) its formation or promotion; or

• (ii) the Offer; or

24

• (f) the Offer,

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

• (g) the formation or promotion of the Company; or

• (h) the Offer.

Steinepreis Paganin has acted as the solicitors to the Company in relation to the Offer. The Company estimates it will pay Steinepreis Paganin $5000 (excluding GST and disbursements) for these services. During the 24 months preceding lodgement of this Prospectus with the ASIC, Steinepreis Paganin has been paid fees totalling $153,667.61 (excluding GST and disbursements) for legal services provided to the Company.

7.7

Consents

Chapter 6D of the Corporations Act imposes a liability regime on the Company (as the offeror of the New Options), the Directors, any underwriters, persons named in the Prospectus with their consent having made a statement in the Prospectus and persons involved in a contravention in relation to the Prospectus, with regard to misleading and deceptive statements made in the Prospectus, Although the Company bears primary responsibility for the Prospectus, the other parties involved in the preparation of the Prospectus can also be responsible for certain statements made in it.

Each of the parties referred to in this Section:

• (a) does not make, or purport to make, any statement in this Prospectus other than those referred to in this Section; and

• (b) in light of the above, only to the maximum extent permitted by law, expressly disclaims and takes no responsibility for any part of this Prospectus other than a reference to its name and a statement included in this Prospectus with the consent of that party as specified in this Section.

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

7.8 Estimated expenses of Offer

The total expenses of the Offer are estimated to be approximately $10,000 as follows:

Expense	($)
ASIC Fees	3,206
Legal Expenses	4,000
Miscellaneous, printing and other expenses	2,794
Total	10,000

25

7.9 Electronic Prospectus

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

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

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

The Company will not be issuing Share certificates, New Option certificates or certificates for Options of the same class as New Options. The Company is a participant in CHESS, for those investors who have, or wish to have, a sponsoring stockbroker. Investors who do not wish to participate through CHESS will be issuer sponsored by the Company. Because the sub-registers are electronic, ownership of securities can be transferred without having to rely upon paper documentation.

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

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.

7.11 Privacy Act

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

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

You can access, correct and update the personal information that we hold about you. Please contact the Company 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 ASX Settlement Operating Rules. You should note that if you do not provide the information required on the application for New Options, the Company may not be able to accept or process your application.

26

8. DIRECTORS’ AUTHORISATION

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

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

---

Keong Chan Executive Chairman For and on behalf of Aumake Limited

27

9. DEFINITIONS

$ means Australian dollars.

Applicant means an investor who applies for New Options pursuant to the Offer.

Application Form means an application form either attached to or accompanying this Prospectus.

ASIC means the Australian Securities and Investments Commission.

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

ASX Listing Rules means the listing rules of ASX.

ASX Settlement Operating Rules means the settlement rules of the securities clearing house which operates CHESS.

Board means the board of Directors unless the context indicates otherwise.

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

Closing Date means the date specified in the timetable in Section 2.1 of this Prospectus (unless extended or brought forward).

Company means Aumake Limited (ACN 150 110 017).

Constitution means the constitution of the Company as at the date of this Prospectus.

Corporations Act means the Corporations Act 2001 (Cth).

December Placement means the placement of Shares which was announced by the Company on 23 December 2020.

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

March Placement means the placement of Shares in respect of which Shareholder approval was sought at the Company’s extraordinary general meeting held on 12 March 2021.

Offer means the offer of New Options referred to in the “Details of the Offer” Section of this Prospectus.

Official Quotation means official quotation on ASX.

Opening Date means the opening date of the Offer as specified in the timetable set out in Section 2.1 of this Prospectus (unless varied).

Option means an option to acquire a Share.

New Option means an Option with the terms and conditions set out in Section 5.1.

Prospectus means this prospectus.

Share means a fully paid ordinary share in the capital of the Company.

Shareholder means a shareholder of the Company.

Share Registry means Computershare Investor Services Pty Ltd.

28

AEDT means eastern daylight time as observed in Sydney, New South Wales. AEST means eastern standard time as observed in Sydney, New South Wales.

29