Introduction

Generally, people buying securities and other financial products must, under the Corporations Act 2001, be given a regulated disclosure document such as a prospectus or product disclosure statement. However, the Act has some exemptions from these requirements.

Three relevant exemptions are for persons that meet the criteria to be assessed as:

• Professional Investor (a financial services licensee holder)
• Sophisticated Investors (holds at least $2.5m of assets or $250,000 of annual income, as certified by an accountant)
• Experienced Investors (has sufficient investing experience).

The issuer and its advisers determine whether an offer without a regulated disclosure document is made available to all three categories, or only Professional and Sophisticated Investors. Therefore, if you qualify as Sophisticated Investor, please go back and submit your application to be classified as a Sophisticated Investor, as you may be eligible to receive some offers that are not also made available to Experienced Investors.

What is the definition of Experienced Investor?

Section 708(10) and s761GA of the Corporations Act permits offers to securities to be made to persons without a disclosure document (as described in the Corporations Act), where the financial services licensee is satisfied on reasonable grounds that the person to whom the offer is made has previous experience in investing in securities that allows them to assess:

1. the merits of the offer
2. the value of the securities
3. the risks involved in accepting the offer
4. their own information needs
5. the adequacy of the information given by the person making the offer

Such people are referred to as Experienced Investors.

OnMarket is of the view that it has reasonable grounds to be satisfied that you are an Experienced Investor, if you represent and warrant that you meet the Corporations Act definition of Experienced Investor, and your accountant or qualified financial planner also states that they have reasonable grounds to believe that you are an Experienced Investor.

Potential benefits of being classified as an Experienced Investor

• Experienced Investors may have the opportunity to participate in corporate offers that may not be available to normal retail clients, such as share placements and underwriting agreements
• These offers are often priced at a discount to the current share price
• Experienced investors may also have the opportunity to participate in unlisted offerings such as seed capital raisings for private companies
• However, you should note that some offers made only be available to Sophisticated Investor, and not Experienced Investors

Potential Risks of being classified as as an Experienced Investor or Sophisticated Investor

An issue of securities to the public normally requires a disclosure statement/prospectus to ensure participants are fully informed about the characteristics of the securities offered, the present position and the future prospects of the entity offering the securities. However, if you are classified as an Experienced Investor, then:

• You may be offered securities that are not accompanied by a regulated disclosure document, and therefore you will not have a document that meets the regulatory requirement to contain all the information about the characteristics of the securities offered, the present position and the future prospects of the entity offering the securities.
• Many of the consumer protection and disclosure provisions that apply to retail clients are not available to people that received Experienced Investors
• You should consult with your accountant, lawyer or qualified financial planner before seeking to be assessed as, and classified by OnMarket BookBuilds Pty Ltd, as an Experienced Investor.

Investor’s Acknowledgement, Warranty and Indemnity

To assist us, and your accountant or qualified financial planner to have reasonable grounds to be satisfied that you meet the definition of an Experienced Investor (as defined in section 708(10) and section 761GA of the Corporations Act), you:

• Will need to answer the questions on the following form
• Represent and warrant that you have accurately and completely answered the following questions, and not omitted any material information that may give OnMarket or your accountant/qualified financial planner reasonable grounds to form the view that you are not an Experienced Investor
• Acknowledge that OnMarket and your qualified financial planner or accountant will rely on the information provided by you in order to be satisfied that you have sufficient experience in investing in securities to assess whether you are an Experienced Investor; and

To the extent permitted by law, you fully indemnify OnMarket and the qualified financial planner or accountant that you will need to ask to support your application to be classified as an Experienced Investor, in respect of any losses, direct or indirect, resulting from, or relating to, investments issued to you as a result of your classification as an Experienced Investor.

To qualify as an Experienced Investor, you must have sufficient previous experience investing in financial products. If this describes you, please complete the form below.