The Trading and Investment Platform for Unlisted Securities Series 1 - - PowerPoint PPT Presentation

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The Trading and Investment Platform for Unlisted Securities Series 1 - - PowerPoint PPT Presentation

The Trading and Investment Platform for Unlisted Securities Series 1 Placement Presentation 26th February 2020 Strictly Confidential 2 Legal Disclaimer General: The information provided in this presentation pertaining to PrimaryMarkets Pty


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The Trading and Investment Platform for Unlisted Securities Series 1 Placement Presentation

26th February 2020

Strictly Confidential

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Strictly Confidential

General: The information provided in this presentation pertaining to PrimaryMarkets Pty Limited (“PrimaryMarkets" or the "Company"), its business assets, strategy and operations is for general informational purposes only and is not a formal offer to sell or a solicitation of an offer to buy any securities, options, futures, or other derivatives related to securities in any jurisdiction and its content is not prescribed by securities laws. Information contained in this presentation should not be relied upon as advice to buy or sell or hold such securities

  • r as an offer to sell such securities. This presentation does not take into account nor does it provide any tax, legal or investment advice or opinion regarding the specific investment
  • bjectives or financial situation of any person. While the information in this presentation is believed to be accurate and reliable, PrimaryMarkets and its agents, advisors, directors,
  • fficers, employees and shareholders make no representation or warranties, expressed or implied, as to the accuracy of such information and PrimaryMarkets expressly disclaims any

and all liability that may be based on such information or errors or omissions thereof. PrimaryMarkets reserves the right to amend or replace the information contained herein, in part or entirely, at any time, and undertakes no obligation to provide the recipient with access to the amended information or to notify the recipient thereof. The information contained in this presentation is intended only for the persons to whom it is transmitted for the purposes of evaluating the Company. The information contained in this presentation supersedes any prior presentation or conversation concerning the Company. Any information, representations or statements not contained herein shall not be relied upon for any

  • purpose. Neither we nor any of our representatives shall have any liability whatsoever, under contract, tort, trust or otherwise, to you or any person resulting from the use of the

information in this presentation by you or any of your representatives or for omissions from the information in this presentation. Additionally, the Company undertakes no obligation to comment on the expectations of, or statements made by, third parties in respect of the matters discussed in this presentation. US transactions to be offered on PrimaryMarkets platform will only be offered through a U.S. FINRA/SIPC broker dealer. All transactions in non-U.S. jurisdictions are facilitated by PrimaryMarkets. Confidentiality: This presentation is confidential and is intended, among other things, to present a general outline of the Company. The contents are not to be reproduced or distributed to the public or press. Each person who has received a copy of this presentation (whether or not such person purchases any securities) is deemed to have agreed: (i) not to reproduce or distribute this presentation, in whole or in part, without the prior written consent of the Company, other than to legal, tax, financial and other advisors on a need to know basis, (ii) if such person has not purchased securities, to return this presentation to the Company upon its request, (iii) without the prior written consent of the Company, not to disclose any information contained in this presentation except to the extent that such information was (a) previously known by such person through a source (other than the Company) not bound by any obligation to keep such information confidential, (b) in the public domain through no fault of such person, or (c) lawfully obtained at a later date by such person from sources (other than the Company) not bound by any obligation to keep such information confidential, and (iv) to be responsible for any disclosure of this presentation, or the information contained herein, by such person or any of its employees, agents or representatives.

Legal Disclaimer

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Executive Summary

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Delivering Liquidity End-to-end solution for trading existing securities, raising new capital with full transaction management and seamless execution from trading through to registry.

BUYERS Own Research Takes Time Missing Know- How Paperwork SELLERS Expensive Gatekeepers High Minimums No Investments Bad Investments High Fees Lack of Diversification

THE PRIMARYMARKETS WAY OLD WAY

Private Trading Hubs | Secondary Share Sales | Capital Raising | Investor Centres | Corporate Advisory | Research | Registry SELLERS BUYERS COMPANIES FUNDS

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VISION To be the premier platform for buying and selling securities in private unlisted Companies and Funds KEY INITATIVES ❖ Enhance investment

  • pportunities and global

deal flow channels ❖ Activate and increase our Investor Network ❖ Expand trading in securities in private companies/funds and ex-ASX-listed ❖ Build out end-to-end online mobile trading app STRATEGIC GOALS ❖ Provide access to trade unlisted securities and proprietary global deal flow ❖ Create end-to-end digital trading platform for unlisted securities ❖ Build large, global Wholesale Investor Network

Vision, Goals and Initiatives

The Trading and Investment Platform

PrimaryMarkets Goals Now:

  • Raise New Equity for Working Capital.
  • Merge/Corporate and Strategic Transactions.

AGGREGATION PLAY THEN EXIT ❖ Roll-up complimentary growth Financial Services FinTechs to build out scale and technology capabilities. ❖ Strategic Partnerships to broaden mutual reach for our investor network and offering opportunities including listed securities ❖ Exit – Trade Sale or IPO

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Our Core Products and Services

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The Trading and Investment Platform for Unlisted Securities

TRADING ✓ Private Trading Hubs ✓ Secondary Trading ✓ Private/unlisted securities ✓ ASX Listed ✓ New Capital Raisings: ✓ Placements ✓ Pre-IPO ✓ Cap Table Management ✓ Registry Services ✓ Dividend Processing ✓ Holding Statements ✓ AGM/EGM ✓ Platform Online Features: ✓ AML/KYC ✓ Wholesale Investor Status Validation ✓ Escrow Services INVESTOR RESOURCES ✓ 105,000+ Global Investor Network and growing ✓ Investor Centres ✓ Enterprise TV – Corporate Videos ✓ Research Commentary Notes CORPORATE ADVISORY ✓ M&A ✓ Asset acquisition & divestment ✓ Public to Private ✓ Strategic Assessments ✓ IPOs ✓ Project Management

Our Website Navigation Bar

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Established, Successful Unlisted Private Companies & Funds + ASX-listed Companies/Funds <A$75M Market Cap

Liquidity Predicament – our Target Markets

Current corporate challenges for our Target Market Unlisted Private Blue-Chip 2,500+ unlisted Companies and Funds

  • Difficult in raising capital
  • Limited opportunities for

liquidity

  • Pressure to go public

ASX Listed 1,050+ companies with market capitalisation of A$75M or less

  • Burdensome compliance and

governance

  • Little research coverage
  • High costs to list and maintain
  • High levels of scrutiny.
  • No greater level of liquidity for

shareholders.

  • Slow and difficult to raise

capital.

Liquidity of ASX Listed Companies with Market Capitalisation between A$50 and A$100 million

Note: (1) Level of liquidity is defined as the aggregated 3 month daily volume expressed as a percentage of the aggregated shares outstanding (2) Only showing sectors with an aggregated market capitalisation of more than $200 million

Metals and Mining Capital Markets Oil, Gas and Consumable Fuels Biotechnology Healthcare Equipment and Supplies Software Pharmaceuticals Professional Services Internet Software and Services Food Products Health Care Technology REITS Diversified Consumer Services Chemicals Media IT Services

  • 20.0

40.0 60.0 80.0 100.0 120.0 140.0 160.0

  • 0.050%

0.100% 0.150% 0.200% 0.250% 0.300% 0.350% 0.400% 0.450%

Average 3 month Daily Volume (million shares) Level of Liquidity

Source: S&P Capital IQ

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Our Core Products

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Private Investing Made Easy Private Trading Hubs Secondary Trading Investor Centres Raising New Capital

➢ Distribution Platform for Unlisted and Listed securities ➢ Direct Marketing to 105,000+ global Investor Network ➢ Corporate Advisory ➢ Research Commentary Notes ➢ Cap Table Management ➢ Online KYC/AML ➢ Online Wholesale Investor Validation ➢ Escrow Services ➢ Corporate Videos Trading facility for existing securities in unlisted Companies and Funds Connecting private Companies and Funds to Wholesale Investors creating liquidity and increasing market presence Multiple one-off trading

  • pportunities for

securityholders in private Companies and Funds Non-Exclusive distribution of new raisings by private Companies and Funds to Wholesale Investors Examples of Trading Hubs and Investor Centres

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Private Trading Hubs

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Trading facility for existing securities in unlisted Companies and Funds

Companies can stay private longer by providing liquidity on an on-going basis, not just at exit. Secure, controlled and independent. Features include: ✓ Flexible Access: Company sets the rules - shareholders only, shareholders and invitees or open access. ✓ Flexible Share Trading Rules. ✓ Transaction controls: Timing and conditions of sale determined by the Company. ✓ Investor Resources: Company determines what is made available. ✓ Integrated processes for settlement. Examples of Recent Successes of

  • ur Trading Hubs

✓ Tyro Payments – Traded A$35M+ from A$0.93 up to IPO December 2019 @ A$3.50 now up to A$4.25+. ✓ AIRR – Traded A$6.60 prior to Takeover by Elders Limited in November 2019 @ A$10.85.

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Private Trading Hubs - Cap Table Management

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A blockchain-based Digital Registry - Cap Table Management Services

View all activity across the register Transaction confirmation Change view between Issuers & shareholder Issue Holding Statement Issue New Securities

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A technology-enabled Trading and Investment Platform

Secondary Trading

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Features include:

  • Facilitating secondary trading of existing shares in a transparent,
  • rderly environment.
  • Opening up the private market for Wholesale Investors to improve

liquidity across all unlisted/private securities.

  • Investors can realize early liquidity without waiting for an IPO or trade

sale.

  • Raises the standard for trading private and unlisted securities.
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Connecting private Companies and Funds to Wholesale Investors creating liquidity + increasing market presence

Investor Centres

Company’s tab with drop down of Investor Centre Resources Live Share Price and Historical Graph Information regularly updated Company Banner Ad

  • n our

Homepage

INVESTOR CENTRE FEATURES ✓ Marketing Communication: We promote twice weekly communications (eDMs) to our 105,000+ global Investor Network. ✓ Platform Prominence: Company is prominently positioned

  • n the PrimaryMarkets Homepage and Navigation bars.

✓ Targeted Investors: We can create specific campaigns accessing PrimaryMarkets’ institutional, wholesale and professional global/local Investor Network. ✓ Dedicated Customer Support ✓ Investor Resources and up-to-date Information: The Company determines what information is made available. ✓ Corporate Video and Commentary Note: Creation of institutional-grade corporate video and Commentary Note to better educate investors.

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Corporate Advisory Services

Strong Record of Promoting both ASX-listed and unlisted Companies/Funds to support strategy and execution

New Capital Raisings

PrimaryMarkets offers a combination of: ➢ Online Platform Listing (open) - a network wide promotion to our 105,000+global investor network. ➢ Discreet Offering (offline) - proactively engaging selected investors.

Example M&A activity Sale of IT Subsidiary of ASX Listed Company

  • Sourced potential Buyers of all securities in wholly owned

subsidiary of ASX listed entity.

  • Active participation in due diligence, negotiations and

completion processes.

WHAT DIFFERENTIATES US ➢ Very Experienced Team with broad industry expertise across all sectors ➢ Direct access to global Investor Network ➢ Direct marketing platform and communications ➢ Independent and not conflicted ➢ Confidential and discreet assignments ➢ Trusted Advisor to Boards, Chairmen and CEOs. FULL SUITE OF ADVISORY SERVICES ➢ M&A ➢ Asset acquisitions & Divestitures ➢ Capital Raisings ➢ Capital Management ➢ Strategic Analysis ➢ Public to Private ➢ Project Management

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Enterprise TV

Video online platform for Investor Relations, Capital Raising and Business Development

PrimaryMarkets oversees production of short corporate videos (2-3 minutes) as an efficient way for Investors to quickly appraise investment

  • pportunities.

We plan to launch in coming months our stand-alone video online platform with our partner TechVoyage – Enterprise TV - in addition to videos currently on our platform. Features: ✓ The Enterprise TV channel with its AI and data analysis and reporting. ✓ The only intelligent promotion & distribution platform ✓ A media asset with expanding catalogue of up-to-date corporate videos ✓ An invaluable tool for all investors seeking investment opportunities and Companies/Funds seeking promotion or new capital raising

PrimaryMarkets current video links Enterprise TV (under construction)

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PrimaryMarkets desires to establish an Investment Fund

PrimaryMarkets Investment Fund – new initiative

Offer Size Strategy Structure Minimum Commitment Target Investment Period Annual Management Fee Incentive Fees Investment Board Targeting up to A$25M - minimum of A$4M Invest in high impact Australian unlisted growth companies with up to A$50M in Total Assets Australian unlisted fund with independent Board A$25,000 per Wholesale Investor 2 to 5 year investment horizon per investee company 2.0% pa of average issued capital 20% of income received + 20% of net capital gains upon realisation above benchmark Independent from PrimaryMarkets Value Proposition

Patient, supportive capital partner Targeting Australian unlisted growth companies Leverage quality deal flow coming via PrimaryMarkets “capture the best

  • pportunities”

Liquidity for investors via the PrimaryMarkets.com platform

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Order Origination

Revenue Model

PrimaryMarkets Economics

➢ Trading Commissions on secondary sales and new capital raisings: ➢ Rack Rate - 6% + GST for 1st $10M, 5% from $10M to $20M then 4% above $20M. ➢ Listing Fee per offering on platform: ➢ Rack Rate $10,000 + GST. ➢ Private Trading Hubs: ➢ Establishment Fee – Rack Rate $25,000 (+ GST). ➢ Quarterly Maintenance Fee – Rack Rate – $7,500 + GST. ➢ Trading Commission – by negotiation either flat fee or %. ➢ Cap Table Management – by negotiation. ➢ Escrow Fees: ➢ Usually included in Private Trading Hub Fees. ➢ Administration Fees – Rack Rate $250 +GST ➢ ECM Fees: ➢ Retainer Fee – by negotiation; ➢ Success Fee – rack rate or TBA. ➢ Corporate Video and Commentary Notes - by negotiation.

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Gross Revenues:

  • 2016/2017

A$884,477.

  • 2017/2018

A$1,569,595.

  • 2018/2019*

A$1,709,400.

  • July-Dec. 2019*

A$526,862.

* PrimaryMarkets income generating activities from February 2019 were re-directed in large part to USA build-out of Linqto’ business so consequently limited revenue earnt by PrimaryMarkets.

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Team

Experienced and successful team

16 Gavin Solomon Founder Executive Chairman 30+ years ECM in Australia/Asia including as MD/CEO & Chairman of Helmsec Global Capital which participated in raising >A$1.7B in 2008-2015 Jamie Green CEO Former Head of M&A Advisory at Patersons Securities, Corporate Finance at Austock (Phillip Capital) and KPMG Corporate Finance Team Members Role Resume Philip Reicherz North American Representative Former Founding Partner SecondMarket Inc, ex-Non-Executive Chairman of Linqto Inc. Brett Spork Strategic Advisor Former CEO of E*Trade Australia, ex Director Macquarie Bank Financial Services, Aust. Stockbroking “ Hall of Fame”. Darren Vaux Strategic Advisor 30+ years in the technology, property and maritime sectors. Director of commercial, NFPs and Government Boards. Nick Capp Non-Executive Director Former CEO PrimaryMarkets and Linqto Inc., ex-multinational divisional head (Linfox), ex-Strategic Advisor to Telstra. Kate Graham Head of Secondary Sales Ex-Merrill Lynch Private Wealth, Macquarie Bank, Deutsche Bank. Joti Singh CFO/GM – Operations & Settlements 15+ years in the Financial Services Industry with expertise in managing accounting, finance, HR, client services and ECM. Rick Solomon CTO 30+ years of experience in the strategic planning and technical/operational management. Tiffany Fok Senior Manager Ex-Macquarie Group, Perpetual Investments and CBA. Oscar de Vries Senior Manager Ex-Network officer Volvo Cars and Ferrari Australasia. Jackson Capp Marketing Manager IT and marketing.

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Contact Us

Headquarters: Sydney Australia Address: Level 12 179 Elizabeth Street SYDNEY NSW 2000 PO Box A298 Sydney South NSW 1235 Phone: +61 2 9993 4475 Email: info@primarymarkets.com Web: www.primarymarkets.com

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APPENDICES

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Corporate History

Commenced in Feb 2016, taken over by Linqto (USA) on 31st Jan 2019 and bought back on 31st Jan 2020

  • PrimaryMarkets, an unlisted Australian public company, commenced business on 26th February 2016.
  • PrimaryMarkets owns Helmsec Global Capital which participated in raising >A$1.7B from 2008-2015 (audited Gross Revenue A$59.3M, Net Profit

A$11M).

  • Up to 31st December 2018, PrimaryMarkets had raised A$4.86M of new equity with its last raising of A$350,000 in Q4 2018 @ pre-money EV A$15M.
  • On 31st January 2019 PrimaryMarkets was subject to a recommended 50/50 scrip-for-scrip Takeover Offer by Linqto, Inc. (USA) at a combined EV

US$24M (i.e. EV of PrimaryMarkets @ US$12M).

  • On 31st January 2020:
  • The Linqto Board decided to focus on its USA operations.
  • Linqto sold 90% of its shareholding in PrimaryMarkets to the Founders of PrimaryMarkets.
  • Linqto and PrimaryMarkets have agreed to work co-operatively together in the future to share mutual opportunities.
  • All original PrimaryMarkets shareholders still remain owners of all their respective Linqto common stock.
  • PrimaryMarkets’ Founders still retain significant shareholdings in Linqto.

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Platform Statistics

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www.primarymarkets.com – Platform Statistics (February 2016 to January 2020)

Investor Network - 105,000+ (40% Australian: 60% overseas)

Member/Followers locations - 119 countries

Opportunities reviewed - 1,264+

Opportunities listed - 318+

Value of all Opportunities listed - > A$2B in value.

Origin of Listings - Australia, NZ, USA, Canada, Germany, Malaysia, Singapore, Hong Kong & UK

Average new unique web visitors per day -115+ Location of Investor Network Location of Website Visitors Examples of Successes in our Trading Hubs

✓ Tyro Payments – Traded A$35M+ from A$0.93 up to IPO December 2019 @ A$3.50 now up to A$4.20+. ✓ AIRR – Traded A$6.60 prior to Takeover by Elders Limited in November 2019 @ A$10.85.

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Cost-Benefit Trade Off for IPO or Staying Listed on ASX

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The realities of contemplating listing or remaining listed on the ASX

What does all this really mean? ➢ Illiquidity for shareholders, investor short termism, limited broker support and difficulty raising new capital. ➢ Initial and ongoing high costs. ➢ Compliance brings costly infrastructure and increased overheads. ➢ Strategic & operational focus taken away with high-maintenance compliance regime. ➢ Attracts undue attention from shareholder activists, short sellers, ligation-funded class actions and opportunistic takeover offers. ➢ ASX enforces controls on companies for diversity, gender targets, social responsibility and “social licence to operate”.

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Example Private Trading Hubs

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Case Studies including 2 highly profitable exits

Case Study – Tyro Payments Limited Private Trading Hub now ASX-listed

  • PrimaryMarkets successfully traded

A$35M+ of then private/unlisted shares virtually all using our escrow services and

  • nline AML/KYC and Buyer Investor Status

processes.

  • Tyro commenced trading on the

PrimaryMarkets Platform with a starting price at A$1.07 per share in August 2016.

  • Commentary Notes prepared by

PrimaryMarkets.

  • Over the ensuing period price discovery

through the PrimaryMarkets Platform saw consistent growth in the value of the shares.

  • Tyro shares reached their peak at A$2.00

per share in September 2019 just prior to the announcement of the proposed IPO, delivering up to a 275% increase on the ASX closing price on 6th December 2019.

  • Tyro has traded as high as A$4.20.

Case Study – Planet Group Holdings ‘BY INVITATION’ Private Trading Hub to support pre-approved trading windows

  • Planet Group Holdings (PGH) reached out

to PrimaryMarkets to provide a independent, controlled market to support the needs of its shareholders (then EV of ~A$80M)

  • PrimaryMarkets re-drafted the Share

Trading Rules to support efficient trading.

  • PGH allows selected third parties access to

the platform to purchase existing shares.

  • PGH shareholders were informed of

PrimaryMarkets’ involvement prior to the AGM and the trading window opened the day after the AGM.

  • Commentary Note prepared by

PrimaryMarkets.

  • The Ecosystem allows PGH to address the

liquidity needs of specific shareholders without the pressure to IPO. Case Study – Haoma Mining NL Ex ASX listed now Private Trading Hub

  • Haoma Mining NL was formerly listed
  • n the Australian Stock Exchange (ASX)
  • The Haoma trading hub is open to

existing shareholders and eligible Buyers introduced by PrimaryMarkets.

  • PrimaryLedger manages the share

registry for Haoma Mining and sends holdings statements to shareholders as required.

  • The Haoma trading hub provides

liquidity for shareholders whilst minimising excessive costs and regulatory requirements necessary for an ASX listing.

  • PrimaryMarkets continues to facilitate

secondary share trading for shareholders. Case Study – AIRR Holdings Limited Private Trading Hub now taken over by ASX listed Elders

  • Trading range when first listed on

PrimaryMarkets trading hub in May 2018 was A$6.60 to last traded price pre takeover in October 2019 of A$8.50.

  • Takeover by Elders Limited (ASX listed)

@ A$10.85 per share – EV $157M delivering up to a 65% increase from takeover.

  • 194 shareholders.
  • PrimaryLedger managed the share

registry for AIRR and sent holdings statements and all takeover documentation to shareholders as required.

  • Commentary Note prepared by

PrimaryMarkets.

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AML/KYC & Buyer Status Verification

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Online, fully integrated AML/KYC/Wholesale Investor Status

  • Full digital process – facilitates the fully digital process of “on-boarding” all Buyer and Seller

Members to interact and transact with the PrimaryMarkets’ Investment Platform

  • Classifications - PrimaryMarkets requires all Buyer Members to be classified one of:

→ Wholesale/Sophisticated Investor; → Professional/Institutional Investor; → Experienced Investor; or → Qualified Institutional Buyer (QIB) or Accredited Investor.

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Escrow Services

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PrimaryMarkets Escrow Services

  • Funds facilitation – PrimaryMarkets Escrow provides an on-

line regime for both sale documents and settlement of transactions.

  • Secure – Funds from a Buyer to the Seller are held in escrow

with Perpetual Trustee (ASX listed independent and diversified financial services group - market cap >A$2B) with either ANZ or Westpac Bank.

  • PrimaryMarkets does NOT hold or touch the funds.
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Commentary Notes

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PrimaryMarkets provides (outsourced) institutional grade reports to build the investment case for potential investors (with no “buy-sell-hold” recommendation unless ASX listed company).

Full financial analysis & FY results Peer Comparisons Upside & Downside cases Valuation Discussion & Analysis Highlights No recommendation (buy/hold/sell) – just commentary to educate