Funtastic Limited ACN 063 886 199 Entitlement Offer

32 Pages·2017·0.75 MB·English

Funtastic Limited ACN 063 886 199
Entitlement Offer

11 for 5 pro rata renounceable entitlement offer of Funtastic Limited
ordinary shares at an offer price of $0.005 per New Share.

Entitlement Offer closes at 5.00pm (Melbourne time) on Tuesday, 12 September 2017

This is an important document which is accompanied by a personalised Entitlement and Acceptance Form for
you to subscribe for new ordinary shares in Funtastic Limited. Please read this document carefully and call
your professional adviser or the Funtastic Offer Information Line if you have any queries.

NOT FOR DISTRIBUTION OR RELEASE IN THE UNITED STATES
Funtastic Entitlement Offer
IMPORTANT NOTICES
Defined terms used in these important notices have the statements are provided as a general guide only and should
meaning given in this Offer Booklet. not be relied upon as an indication or guarantee of future
performance. Readers are cautioned not to place undue
NOT FOR DISTRIBUTION OR RELEASE IN THE UNITED reliance on forward-looking statements.
STATES.
The forward looking statements are based on information
The Entitlement Offer is being made pursuant to section available to Funtastic as at the date of this Offer Booklet.
708AA of the Corporations Act (as notionally modified by Except as required by law or regulation (including the ASX
Corporations (Non-Traditional Rights Issues) Instrument Listing Rules), Funtastic undertakes no obligation to provide
2016/84) which allows entitlement issues to be offered without any additional or updated information whether as a result of
a prospectus. As a result, this offer is not being made under a new information, future events or results or otherwise.
prospectus and it is important for Eligible Shareholders (as
defined in section 6.2) to read and understand the information Past performance
on Funtastic Limited ACN 063 886 199 (Funtastic) and the
Entitlement Offer made publicly available, before taking up all Investors should note that past performance, including past
or part of their entitlements to purchase new ordinary shares share price performance, cannot be relied upon as an indicator
in Funtastic (New Shares) pursuant to the offer described in of (and provides no guidance as to) future Funtastic
this Offer Booklet (Entitlements). In particular, please refer to performance including future share price performance.
the enclosed materials including the Investor Presentation
included at section 3 of this document. Funtastic’s interim and Jurisdictions
annual reports and other announcements are made available
at www.funtastic.com.au or www.asx.com.au. This Offer Booklet is intended for use only in connection with
the Entitlement Offer to Eligible Shareholders with a registered
This Offer Booklet is dated Friday, 1 September 2017. address in New Zealand or Australia. This Offer Booklet does
not constitute an offer or invitation in any place in which, or to
This information is important and requires your immediate any person to whom, it would not be lawful to make such an
attention. offer or invitation.

You should read this Offer Booklet carefully in its entirety This Offer Booklet, or any accompanying ASX announcements
before deciding whether to invest in New Shares (defined or the Entitlement and Acceptance Form, does not constitute
below). In particular, you should consider the risk factors an offer to sell, or a solicitation of an offer to buy, any securities
outlined in the "Key Risks" section of the enclosed Investor in the United States. Neither this Offer Booklet nor the
Presentation that could affect the operating and financial Entitlement and Acceptance Form may be distributed or
performance of Funtastic or the value of an investment in released in the United States. Neither the Entitlements nor the
Funtastic. New Shares have been, nor will be, registered under the US
Securities Act of 1933, as amended (US Securities Act), or
Future performance and forward looking statements the securities laws of any state or other jurisdiction of the
United States. Neither the Entitlements nor the New Shares
This Offer Booklet contains certain 'forward looking may be offered, sold or resold in the United States or to
statements'. Forward looking statements can generally be persons acting for the account or benefit of a person in the
identified by the use of forward looking words such as 'expect', United States except in a transaction exempt from, or not
'anticipate', 'likely', 'intend', 'propose', 'should', 'could', 'may', subject to, the registration requirements of the US Securities
‘will’, 'predict', 'plan', 'believe', 'forecast', 'estimate', 'target', Act and applicable United States State securities laws. In the
‘continue’, ‘objectives’, ‘outlook’, ‘guidance’ and other similar Entitlement Offer, the Entitlements and the New Shares will
expressions within the meaning of securities laws of applicable only be sold in 'offshore transactions' (as defined in Rule
jurisdictions and include, but are not limited to, statements 902(h) under the US Securities Act) in compliance with
regarding the outcome and effects of the Entitlement Offer and Regulation S under the US Securities Act.
the use of proceeds, certain plans, strategies and objectives of
management, expected financial performance and Funtastic’s References to 'you' and 'your Entitlement'
debt arrangements. The forward looking statements, opinions
and estimates contained in this Offer Booklet are based on In this Offer Booklet, references to 'you' are references to
assumptions and contingencies which are subject to change Eligible Shareholders and references to 'your Entitlement' or
without notice, as are any statements about market and 'your Entitlement' (or 'your Entitlement and Acceptance Form')
industry trends, which are based on interpretations of current are references to the Entitlement (or Entitlement and
market conditions. They involve known and unknown risks and Acceptance Form) of Eligible Shareholders (as defined in
uncertainties and other factors, many of which are beyond the Section 6.2), unless the context provides otherwise.
control of Funtastic and its officers, employees, agents and
associates, ,and may involve significant elements of subjective Times and dates
judgement and assumptions as to future events which may or
may not be correct. Times and dates in this Offer Booklet are indicative only and
subject to change. All times and dates refer to Melbourne time.
Refer to the 'Key Risks' section of the Funtastic Investor Refer to the 'Key Dates' section of this Offer Booklet for more
Presentation included in Section 3 of this Offer Booklet for a details.
summary of certain general and Funtastic specific risk factors
that may affect Funtastic. There can be no assurance that Currency
actual outcomes will not differ materially from these forward
looking statements. A number of important factors could cause Unless otherwise stated, all dollar values in this Offer Booklet
actual results or performance to differ materially from the are in Australian dollars (A$).
forward looking statements. Investors should consider the
forward looking statements contained in this Offer Booklet in New Shares
light of those disclosures. There are usually differences
between forecast and actual results because events and Funtastic and the Underwriters (as defined in section 6.16) will
actual circumstances frequently do not occur as forecast and have no responsibility and disclaim all liability (to the maximum
their differences may be material. Any forward-looking extent permitted by law) to persons who trade New Shares
Funtastic Entitlement Offer
they believe will be issued to them before they receive their
holding statements, whether on the basis of confirmation of the
allocation provided by Funtastic or the Funtastic Share
Registry (as specified in the Corporate Directory) or otherwise,
or who otherwise trade or purport to trade New Shares in error
or which they do not hold or are not entitled to.

If you are in any doubt as to these matters you should first
consult with your stockbroker, accountant or other professional
adviser.

Funtastic Entitlement Offer
CONTENTS
Contents
Key Dates For Entitlement Offer ............................................................................................. 2
Letter From The Chairman ....................................................................................................... 3
1 Summary of options available to you ........................................................................ 5
2 How to apply ................................................................................................................. 6
3 ASX Announcements ................................................................................................. 14
4 Australian taxation considerations .......................................................................... 15
5 Effect of the Entitlement Offer on the control of Funtastic ................................... 18
6 Important information ................................................................................................ 19

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KEY DATES FOR ENTITLEMENT OFFER

Event Date
Announcement of Entitlement Offer Wednesday, 23 August 2017
Ex-Date and Entitlement trading period Monday, 28 August 2017
commences
Record Date for the Entitlement Offer 7.00pm (Melbourne time) on Tuesday, 29
August 2017
Despatch of Offer Booklet and Entitlement and Friday, 1 September 2017
Acceptance Form to Eligible Shareholders
Entitlement Offer opens Friday, 1 September 2017
Entitlement Trading period closes 4.00pm on Tuesday, 5 September 2017
Entitlement Offer closes 5.00pm on Tuesday, 12 September 2017
Allotment of New Shares under the Tuesday, 19 September 2017
Entitlement Offer
Dispatch of holding statements Tuesday, 19 September 2017
Normal trading of New Shares issued under Wednesday, 20 September 2017
the Entitlement Offer expected to commence
on ASX

The timetable above is indicative only and may be subject to change without notice. Funtastic, with the consent of
the Underwriters (as defined in Section 6.16) in certain situations, reserves the right, subject to the Corporations
Act 2001 (Cth) (Corporations Act), ASX Listing Rules and other applicable laws to amend or vary any or all of the
dates and times without notice. In particular, Funtastic reserves the right to extend the closing date of the
Entitlement Offer, accept late applications (either generally or in particular cases) and to withdraw the Entitlement
Offer without prior notice.
The commencement of quotation of New Shares is subject to confirmation from ASX.
Cooling off rights do not apply to the Entitlement Offer. You cannot withdraw your application once it has been
accepted. Eligible Shareholders are encouraged to submit their Entitlement and Acceptance Form as soon as
possible after the Entitlement Offer opens.
Enquiries
If you have any questions, please call the Funtastic Offer Information Line on 1300 737 760 (within Australia) or
[phone] (from outside Australia) between 8:30am and 5:30pm (Melbourne time) Monday to Friday during
the Entitlement Offer Period, or consult your stockbroker, lawyer, accountant, financial adviser or other independent
professional adviser.

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LETTER FROM THE CHAIRMAN
1 September 2017

Dear Shareholder

On behalf of Funtastic, I am pleased to invite you to participate in a 11 for 5, pro rata renounceable
entitlement offer of new ordinary shares in Funtastic (New Shares) at an offer price of $0.005 per
New Share (Offer Price) to raise gross proceeds of approximately $8.2 million (Entitlement
Offer), of which $8 million has been underwritten.

Proceeds
The proceeds of the Entitlement Offer will be used to reduce short term debt and provide additional
working capital

Entitlement Offer
Under the Entitlement Offer, eligible shareholders are entitled to acquire 11 New Shares for every
5 existing Funtastic ordinary shares (Shares) held on the record date, being 7.00pm (Melbourne
time) on Tuesday, 29 August 2017 (Record Date). The Board considers that the pro rata nature
of the Entitlement Offer favours existing Funtastic shareholders in recognition of their continuing
support.

The Offer Price of $0.005 per New Share represents a discount of 50% to the closing market price
of Shares on Wednesday, 23 August 2017, the business day before the Entitlement Offer was
announced, and a 24% discount to the theoretical ex-rights price (TERP).

New Shares issued under the Entitlement Offer will rank equally with existing Shares.

The Entitlement Offer only comprises a retail component. This Offer Booklet relates to the
Entitlement Offer and entitlements allotted under it (Entitlements).

Accompanying this Offer Booklet is your personalised Entitlement and Acceptance Form which
contains details of your Entitlement. Your Entitlement may have value and it is important that you
determine whether to take up, sell on the ASX, transfer or do nothing in respect of your Entitlement
(see Section 1).

It is important to note the action which you must take in order to participate in the Entitlement Offer.
Taking no action will result in a lapse of your rights for no consideration and dilute your percentage
ownership in Funtastic.

The Entitlement Offer closes at 5.00pm (Melbourne time) on Tuesday, 12 September 2017. To
participate, you need to ensure that you have completed your application by paying the requisite
accompanying payment (Application Monies) by BPAY®1, or by lodging your Entitlement and
Acceptance Form with your Application Monies paid by cheque, so that they are received before
this time in the manner described in this Offer Booklet.

Further information
Further information on the Entitlement Offer and Funtastic’s business is detailed in this Offer
Booklet.

You should carefully read this Offer Booklet in its entirety and consult your financial adviser before
making your investment decision. In particular, you should read and consider the ‘Key Risks’
section of the Funtastic Investor Presentation included in Section 3 of this Offer Booklet which
contains a summary of some of the key risks associated with an investment in Funtastic.

1 Registered to BPAY Pty Ltd (ABN 69 079 137 518)
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If you have any questions in respect of the Entitlement Offer please call the Funtastic Offer
Information Line on 1300 737 760 (within Australia) or [phone] (outside Australia) at any
time from 8:30am to 5:30pm (Melbourne time) Monday to Friday during the Entitlement Offer
period.

On behalf of the Funtastic Board, I encourage you to consider this opportunity to participate in the
growth of Funtastic.

Yours faithfully,

Shane Tanner
Chair
Funtastic Limited

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1 Summary of options available to you
If you are an Eligible Shareholder (as defined in Section 6.2) you may take any one of the
following actions:
(a) take up all or part of your Entitlement;
(b) sell all or part of your Entitlement to persons meeting certain eligibility criteria:
(i) on the ASX; or
(ii) by transferring it directly to another person; or
(c) do nothing and let all or part of your Entitlement lapse.
If you are a shareholder that is not an Eligible Shareholder you are an Ineligible
Shareholder.
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Options Key considerations
available to you
Option 1: Take • You may elect to purchase New Shares at the Offer Price (see Section 2.5(a) for
up all or part of instructions on how to take up your Entitlement).
your
• The New Shares will be fully paid and rank equally in all respects with existing Shares
Entitlement
from allotment.
• The Entitlement Offer closes at 5.00pm (Melbourne time) on Tuesday, 12 September
2017.
• If you do not take up your Entitlement, or only take up part of your Entitlement, the
balance will lapse and you will receive no benefit.
• Eligible Shareholders are not able to apply for New Shares in excess of their
Entitlement as set out in their personalised Entitlement and Acceptance Form.
Option 2: Sell • If you do not take up all or part of your Entitlement, you may be able to sell all or part
all or part of of your Entitlements on the ASX through your broker or transfer your Entitlement
your directly to another person (see Section 2.5(b) and 2.5(c)).
Entitlement on
• Entitlement trading on ASX starts at 10.00am on Monday, 28 August 2017 (ASX Code:
ASX or transfer
FUNR) until the close of ASX trading on Tuesday, 5 September 2017. You should allow
your
sufficient time for your instructions to be carried out by your stockbroker. Please note
Entitlement
you may incur brokerage if you choose to sell your Entitlement on ASX.
• For certain Eligible Shareholders who are Australian tax residents and hold their
existing shares on capital account, the proceeds of any sale of the Entitlement will be
taken into account in calculating any capital gain for Australian income tax purposes
(see Section 4).
• Prices obtained for Entitlements may rise and fall over the Entitlement trading period
and will depend on many factors including the demand for and supply of Entitlements
on the ASX and the value of existing Funtastic shares relative to the Offer Price. If you
sell your Entitlement in the Entitlement trading period, you may receive a higher or
lower amount than a shareholder who sells their Entitlement at a different time in the
Entitlement trading period. You will also forgo any exposure to increases or decreases
in the value of New Shares had you taken up that Entitlement. Your percentage
shareholding in Funtastic will also be diluted.
• If you only sell part of your Entitlement, you may choose to take up the remainder (see
Option 1) or you may do nothing and let that part lapse (see Option 3 below).
Option 3: Do • If you do nothing with respect to all or part of your Entitlement, the relevant portion of
nothing and let your Entitlement will lapse and you will receive no benefit. These Entitlements will be
all or part of subscribed for by the Underwriters.
your
• By allowing your Entitlement to lapse, you will forgo any exposure to increases or
Entitlement
decreases in the value of the New Shares had you taken up your Entitlement. Although
lapse
you will continue to own the same number of Shares, your percentage shareholding in
Funtastic will be diluted.

2 How to apply
2.1 Overview of the Entitlement Offer
Eligible Shareholders are being offered the opportunity to purchase 11 New Shares for
every 5 existing Shares held as at 7.00pm (Melbourne time) on Tuesday, 29 August 2017
(Record Date), at the Offer Price of $0.005 per New Share.
You have a number of decisions to make in respect of your Entitlement. You should read
this Offer Booklet carefully before making any decisions in relation to your Entitlement.
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The Entitlement Offer is partially underwritten by the Underwriters on the terms and
conditions of the Underwriting Agreement (see section 6.16 below). Further details on the
Entitlement Offer are set out below.
2.2 The Entitlement Offer
Under the Entitlement Offer, Eligible Shareholders are invited to apply for 11 New Shares
for every 5 existing Shares held as at the Record Date at the Offer Price of $0.005 per New
Share.
The Entitlement Offer opens at 9.00am (Melbourne time) on Friday, 1 September 2017
and will close at 5.00pm (Melbourne time) on Tuesday, 12 September 2017.
2.3 Your Entitlement
Your Entitlement is set out on the accompanying personalised Entitlement and Acceptance
Form and has been calculated as 11 New Shares for every 5 existing Shares you held as
at the Record Date. If the result is not a whole number, your Entitlement will be rounded
up to the nearest whole number of New Shares.
If you have more than one registered holding of Shares, you will be sent more than one
personalised Entitlement and Acceptance Form and you will have a separate Entitlement
for each separate holding.
See Sections 6.2 and 6.15 for information on restrictions on participation.
2.4 Consider the Entitlement Offer carefully in light of your particular investment
objectives and circumstances
The Entitlement Offer is being made pursuant to provisions of the Corporations Act which
allow entitlement offers to be made without a prospectus. This Offer Booklet does not
contain all of the information which may be required in order to make an informed decision
regarding an application for New Shares offered under the Entitlement Offer. As a result,
it is important for you to read carefully and understand the information on Funtastic and the
Entitlement Offer made publicly available, prior to deciding whether to take up all or part of
your Entitlement or do nothing in respect of your Entitlement. In particular, please refer to
this Offer Booklet and other announcements made available at www.funtastic.com.au
(including announcements which may be made by Funtastic after publication of this Offer
Booklet).
Please consult with your stockbroker, lawyer, accountant, financial adviser or other
professional adviser if you have any queries or are uncertain about any aspect of the
Entitlement Offer. You should also refer to the 'Key Risks' section of the Funtastic Investor
Presentation included in Section 3 of this Offer Booklet.
2.5 Options available to you
If you are an Eligible Shareholder, you may take any of the following actions:
• take up all or part of your Entitlement (see Section 2.5(a));
• sell all or part of your Entitlement to persons meeting certain eligibility criteria;
o on the ASX (see Section 2.5(b)); or
o by transferring it directly to another person (see Section 2.5(c)); or
• do nothing and let your Entitlement lapse (see Section 2.5(d)).
(a) If you wish to take up all or part of your Entitlement
If you wish to take up all or part of your Entitlement, please either:
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