DOMACOM LIMITED For personal use only
DomaCom Limited
ACN 604 384 885
Supplementary Prospectus
Important information
This is a supplementary prospectus under section 719 of the Corporations Act 2001 (Cth) (Supplementary Prospectus) which supplements and must be read with the prospectus dated 26 May 2022 (Prospectus) issued by DomaCom Limited (ACN 604 384 885) (DomaCom or Company).
This Supplementary Prospectus is dated 11 July 2022 and was lodged with ASIC on that date. Neither ASIC nor ASX take any responsibility as to the contents of this Supplementary Prospectus.
Other than the changes set out in this Supplementary Prospectus, all other details in relation to the Prospectus remain unchanged. To the extent of any inconsistency between this Supplementary Prospectus and the Prospectus, the provisions of this Supplementary Prospectus will prevail. Unless otherwise indicated, terms defined and used in the Prospectus will have the same meaning in this Supplementary Prospectus.
The Directors believe that the changes in this Supplementary Prospectus are not materially adverse from the point of view of an investor.
The Company has issued both a printed and electronic version of this Supplementary Prospectus and the Prospectus. Electronic versions may be accessed at www.domacom.com.
This Supplementary Prospectus and the Prospectus are important documents that should be read in their entirety. If you are in any doubt as to the contents of this Supplementary Prospectus or the Prospectus, you should consult your stockbroker, lawyer, accountant or other professional adviser without delay.
1. BACKGROUND
By this Supplementary Prospectus, the Company makes the amendments to the Prospectus as set out in section 2, to extend the Offer Closing Date to Monday 10 October 2022 (unless closed earlier at the Board's discretion) and refresh the time period within which the quotation condition set out in the Prospectus must be satisfied.
The Prospectus included disclosure regarding the Private Placement, which as announced on 26 May 2022 then consisted of a placement of up to 72,727,272 Shares (at an issue price of $0.066 per Share) by the Company through a non-underwritten private placement to Sophisticated and Institutional Investors only.
The Company is pleased to announce that, due to the level of interest in the Private Placement, the Directors have resolved to increase the maximum number of Shares to be issued under the Private Placement by up to 6,060,606 Shares, at an issue price of $0.066 per Share, which would raise up to a further $400,000 and increase the total funds raised under the Private Placement up to $5.2 million.
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Mr George Paxton, Director, now intends to participate in the Private Placement, on the same terms as the other Private Placement participants, subject to Shareholder approval for an amount of up to $200,000 (being 3,030,303 Shares at $0.066 per Share) (Director Placement). The amount to be raised under the Director Placement forms part of the overall funds to be raised under the Private Placement of up to $5.2 million. The Company will convene a meeting of Shareholders to seek approval for the Director Placement in due course.
2. SUPPLEMENTARY PROSPECTUS
2.1. Reasons for this Supplementary Prospectus
The reasons for this Supplementary Prospectus are:
- to provide updated disclosure in relation to the increased size of the Private Placement and the participation by Mr George Paxton in the Private Placement;
- to extend the Offer Closing Date to Monday 10 October 2022 (unless closed earlier at the Board's discretion); and
- to refresh the time period within which the quotation condition must be satisfied.
2.2 The increased Private Placement
All references to the maximum number of shares to be issued under the Private Placement (previously 72,727,272) are replaced with 78,787,878, and all references to the amount of the total Private Placement proceeds (previously $4,800,000) are replaced with $5,200,000.
All references to the maximum number of shares to be issued under Tranche 2 of the Private Placement (previously 61,590,909) are replaced with 67,651,515, and all references to the amount of the total Tranche 2 proceeds (previously $4,065,000) are replaced with $4,465,000.
All references to the issue date of Shares under Tranche 2 of the Private Placement are to exclude the issue of the Shares under the Director Placement which are expected to be issued on or before 10 October 2022 subject to Shareholder approval being obtained.
The Company intends to apply the additional $400,000 to be raised (before costs) pursuant to the increased Private Placement towards general working capital.
With the extended timeframe for completion of the Private Placement, progress of Company's reinstatement has been delayed. All references to an expected date for reinstatement of Shares to trading on the ASX of 14 July 2022 are replaced with 8 August 2022.
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2.3 Effect of the Offer on the Company's Securities
The table in Section 1.3 of the Prospectus is replaced with the following:
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Effect on capital structure (Shares)
Current DomaCom
Shareholders
Private Placement
Number of Shares on issue at completion of the Private Placement
Number of Shares on Issue | Number of Shares on Issue | |
(Minimum raised of $735k - | (Maximum raised of $5.2m) - | |
Tranche 1) | Tranche 1 & 2 | |
361,650,215 | 361,650,215 | |
11,136,363 | 78,787,878 | |
372,786,578 | 440,438,093 | |
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Note: The above table assumes that no Shares are issued and no funds are raised pursuant to the Offer (with the purpose of the Offer being to remove secondary trading restrictions on the Shares issued under the Private Placement), but assuming in respect of the first column, that the Private Placement raises $735,000 under Tranche 1 only and in respect of the second column, that the Private Placement raises $5,200,000 under Tranche 1 & 2. This also assumes that Shareholders approve the Director Placement (being the issue of 3,030,303 Shares to Mr George Paxton) as part of Tranche 2 of the Private Placement.
2.4. Pro-forma balance sheet
Section 3.2 of the Prospectus is amended as follows:
- increase the "cash and cash equivalents" line item under the Proforma Balance (Tranche 1 and Tranche 2) column from $5,370,340 to $5,673,040*;
- increase the "total current assets" line item under the Proforma Balance (Tranche 1 and Tranche 2) column from $5,501,003 to $5,803,703;
- increase the "total assets" line item under the Proforma Balance (Tranche 1 and Tranche 2) column from $7,354,150 to $7,656,850;
- increase the "net assets" line item under the Proforma Balance (Tranche 1 and Tranche 2) column from $3,360,007 to $3,662,707;
- increase the "issued capital" line item under the Proforma Balance (Tranche 1 and Tranche 2) column from $45,051,606 to $45,354,306;
- increase the "total equity" line item under the Proforma Balance (Tranche 1 and Tranche 2) column from $3,360,007 to $3,662,707; and
- increase the "Estimates Share Issue Costs" in both Table 3 and Table 4 for the maximum subscription under the Private Placement (ie Tranches 1 and 2) from $288,000 to $401,300.
- The pro-forma cash and cash equivalents line item will be reduced by the costs of the Entitlement Offer. The above amendments assume that all Shares under the increased Private Placement are issued (including 3,030,303 Shares to Mr George Paxton under the Director Placement).
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2.5. Director's interests
The table in Section 5.1 of the Prospectus is replaced with the following:
Director | Number of | Voting power | Number of | Voting power | Voting power | ||||||
Shares held | in Shares | Shares held | following | following | |||||||
(as at the date | (as at the date | (on completion | minimum issue | maximum | |||||||
of this | of this | of the Private | of Shares under | issue of | |||||||
Prospectus) | Prospectus) | Placement and | Private | Shares under | |||||||
Offer) | Placement 4- | Private | |||||||||
Tranche 1 | Placement 5 | ||||||||||
Tranche 1 & 2 | |||||||||||
John Hewson | - | - | - | - | - | ||||||
Grahame Evans | 1,431,099 | 0.40% | 1,431,099 | 0.38% | 0.32% | ||||||
Ross Laidlaw | 2,391,924 | 0.66% | 2,391,924 | 0.64% | 0.54% | ||||||
George Paxton1 | - | - | 3,030,303 | 0.00% | 0.69% | ||||||
Matthew Roberts2 | 57,273,819 | 15.84% | 59,546,546 | 15.97% | 13.52% | ||||||
Angela Williams | - | - | - | - | - | ||||||
Hilal Yassine3 | 8,333,333 | 2.30% | 8,333,333 | 2.24% | 1.89% | ||||||
- This assumes that Shareholder approval is obtained to the issue of 3,030,303 Shares under the Director Placement and all such Shares are issued.
- Matthew Roberts has a relevant interest in Halo Technologies Limited that through its subsidiary Halo Investment Co Pty Ltd holds 57,273,819 in DomaCom Limited.
- Hilal Yassine is deemed to have a beneficial interest in 8,333,333 ordinary shares held by FQC Fintech Pty Limited.
- These percentages assume all Shares are issued under Tranche 1 only.
5These percentages assume all Shares are issued under the Private Placement (being Tranche 1 and Tranche 2 in full).
2.6. Potential effect on control of the Company
With the increased amount of the Private Placement, on completion of Tranche 2 of the Private Placement, the holding of Halo Investment Co Pty Ltd will decrease to 13.52% of the Company's issued capital and the holding of FQC Fintech 2 Pty Ltd will decrease to 10.03% of the Company's issued capital, with references to these amounts to be adjusted accordingly in section 5.2 of the Prospectus.
2.7. Dilution Risk
With the increased amount of the Private Placement, there will be a slightly increased dilutionary impact on existing Shareholders, with section 5.3(b) to be replaced with the following:
- 17.89% of the Company's total issued capital on completion of the full increased Private Placement (both Tranche 1 and Tranche 2 and assuming Shareholders approve the Directors Placement).
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3. EXPENSES OF THE OFFER
The total expenses of the Offer and the Private Placement are estimated to increase by up to $97,300 as follows:
- Increase in broker commission calculated at 6% (excluding GST) resulting from additional capital raised of $12,000 from $288,000 to $300,000.
- Increase in broker commission as a result of increasing the broker commission up to 8% (excluding GST) for Tranche 2 only of $85,300 from $300,000 to $385,300.
Related Party Payments
Atlantic Pacific Securities Pty Limited trading as ASR Wealth Advisers (ASRW) has acted as a broker for both Tranche 1 and Trance 2 of the Private Placement. The commission paid to ASRW was 6% for applications received before 7 June 2022 and 8% for applications received after 7 June 2022, following volatile share market conditions. In the event that the maximum raise of $5,200,000 is achieved, the maximum commission payable to ASRW in connection with the Private Placement would be up to $308,760 excluding GST. The Directors of DomaCom Limited confirm that the transaction was carried out on an arm's length basis.
Matthew Roberts currently holds 57% of the Share Capital of ASWR. By virtue of this holding and his role as a Director of DomaCom Limited, ASRW is treated as a related party.
4. EXTENDING THE OFFER CLOSE DATE
Under the Prospectus, the Offer was scheduled to close on Tuesday 14 June 2022 (being the Closing Date of the Offer). On 8 June 2022 DomaCom made an announcement to extend the Closing Date of the Offer to Tuesday 28 June 2022. On 23 June 2022 DomaCom made an announcement to extend the Closing Date of the Offer to Tuesday 12 July 2022.
The Board has decided to further extend the Offer Closing Date by up to 3 months from the date of this Supplementary Prospectus to 10 October 2022 to allow further time for prospective investors to consider the Offer and provide the Company additional time to market the Offer and hold a meeting of the Company to approve the issue of Shares under the Director Placement to Mr George Paxton. Accordingly, the Offer will now close on Monday 10 October 2022 (unless closed earlier at the Board's discretion). It is noted that the issue of all other Shares under Tranche 2 of the Placement will not be subject to Shareholder approval.
5. REFRESHMENT OF TIME PERIOD TO SATISFY QUOTATION CONDITION
Section 723(3) of the Corporations Act requires that a person offering securities under a disclosure document which states or implies that the securities are to be quoted on a financial market, to refund any application monies if those securities are not quoted within three (3) months of the date of the disclosure document (Quotation Condition).
In order to accommodate extension of the Offer Closing Date by up to 3 months from the date of this Supplementary Prospectus, the Company also intends to refresh the time period within which the Quotation Condition must be met in reliance on ASIC Corporations (Minimum Subscription and Quotation Conditions) Instrument 2016/70 (ASIC LI 2016/70). As a result of this refreshment, the Quotation Condition can be met within 3 months from the date of this Supplementary Prospectus. In order to rely on ASIC LI 2016/70, the Company is required to disclose the following information under Section 724(3H) as notionally inserted by ASIC LI 2016/70:
- an application for admission to quotation of the securities was made within seven days after the date of the original disclosure document for the Offer (being the Prospectus);
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DomaCom Australia Ltd. published this content on 10 July 2022 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 10 July 2022 23:53:06 UTC.
