Praemium Limited (ASX:PPS) entered into a proposal of interest to acquire remaining 84.9% stake in Powerwrap Limited (ASX:PWL) from from a group of shareholders for AUD 46.5 million on July 9, 2020. Under the offer, each holder of Powerwrap shares will receive AUD 0.075 per share in cash and one Praemium share for every two Powerwrap shares held. The offer for total consideration will be AUD 0.26 per share. Before the end of the Offer Period, all Powerwrap options issued in favour of persons that are not employees of Powerwrap are cancelled or are the subject of agreements or arrangements entered into between Powerwrap and the relevant holders of the options that will cause the options to be cancelled, in each case, for nil or nominal consideration. The number of performance rights of Powerwrap which are capable of vesting up to and including December 31, 2020, vest and convert into Powerwrap shares prior to the end of the Offer Period, provided they do not cause the fully diluted share count of Powerwrap to exceed 212 million. Performance rights which have been issued but do not vest until the end of the financial year ending June 31, 2021, or thereafter shall not be included for the purposes of determining the fully diluted share count. Before the end of the offer period, all of the restricted securities of Powerwrap are free of any restriction or are the subject of agreements or arrangements entered into between Powerwrap and the relevant holders of the restricted securities that will cause the restricted securities to be free of any restriction. Offer provides Powerwrap Shareholders an opportunity to participate in the expected benefits and longer-term performance afforded by the combination of two highly complementary businesses in Praemium and Powerwrap. If Praemium acquires at least 90% of the Powerwrap Shares but it acquires less than 75% (by number) of the Powerwrap Shares under the Offer, Praemium currently intends to give notices to Powerwrap Shareholders to compulsorily acquire any outstanding Powerwrap Shares in accordance with section 664C of the Corporations Act. If Praemium achieves a Relevant Interest in at least 90% of the Powerwrap Shares and acquires at least 75% (by number) of the Powerwrap Shares under the Offer, Praemium currently intends to initiate the compulsory acquisition procedure in section 661A of the Corporations Act and to give notices to Powerwrap Shareholders to compulsorily acquire any outstanding Powerwrap Shares in accordance with section 661B of the Corporations Act. Currently, Praemium holds 15.1% stake representing 31.1 million shares in Powerwrap, post completion of the transaction, Praemium will hold 100% stake in Powerwrap. Praemium intends to fund the cash component of the offer consideration through AUD 15 million term loan facility, scrip and Praemium also has sufficient cash reserves available to meet the additional AUD 900,000 that may be required to be paid in cash under the Offer. As on August 28, 2020, Praemium has obtained confirmation from its financier, HSBC, that funding under the Debt Facility will continue to remain available to Praemium with respect to the Offer, provided that, by the end of the Offer Period, Praemium has obtained a relevant interest in atleast 50% of all Powerwrap Shares on issue, if they fail to do so, it will, in any event, fund the cash component of the Offer Consideration entirely out of its existing cash reserves. This change happened due to waiver of minimum acceptance Defeating Condition. Praemium's current cash at bank, net of regulatory capital requirements required to be set aside, is approximately AUD 8.5 million. Assuming no more than 50% of all Powerwrap Shareholders accept the Offer, the maximum amount in cash that Praemium could be required to pay under the Offer is AUD 5.61 million. As on August 28, 2020, Praemium advises that the Offer Consideration is final and Praemium will not increase the Offer Consideration during the Offer Period and Praemium has a relevant interest in 33.30% of all Powerwrap Shares.

Praemium intends to amend the constitution of Powerwrap to reflect its status as a wholly owned subsidiary of Praemium and will seek to convert Powerwrap from a public company to a proprietary company. Praemium intends to replace members of the Powerwrap Board with nominees of Praemium, so that the proportion of such nominees is broadly similar to the voting power of Praemium. No changes are proposed to be made to the Praemium Board. The transaction is subject to 90% minimum acceptance by Powerwrap shareholder, secure all third-party consents or approvals required and all ordinaries Index does not, for a period of 3 consecutive trading days, fall below 30% of the level of that index as at the close of normal trading on the ASX on July 9, 2020. Praemium intends to apply to have Powerwrap delisted from the ASX (where it achieves a shareholding of at least 75% and associated requirements) The Powerwrap board of directors unanimously recommend that Powerwrap shareholders accept the offer. As on August 28, 2020, Praemium waived the 90% minimum acceptance and third-party consents or approvals as a condition subject for the transaction. As on September 2, 2020, the offer becomes wholly unconditional. The Directors of Powerwrap unanimously recommend its shareholders to accept the offer in absence of any superior proposal on September 4, 2020. As reported on September 14, 2020, the offer is free from all defeating condition. Praemium and Powerwrap may terminate this agreement by written notice to the other party if at any time after June 9, 2020. The offer period commences on July 30, 2020 and will be open till August 31, 2020. As of August 14, 2020, offer is expected to complete in September 2020. The offer period will initially last for at least one month or may vary if the offer period is extended or the offer is withdrawn as permitted by the Corporations act. As of August 2, 2020, offer is expected to complete on September 21, 2020.

Deloitte Touche Tohmatsu Australia, Investment Banking Arm acted as financial advisor, Foster Nicholson Lawyers Pty Ltd and Arnold Bloch Leibler acted as legal advisors to Praemium Limited. Henslow Pty. Ltd. acted as financial advisor and John Hutchinson and James Morvell of Hall & Wilcox Lawyers acted as legal advisors to Powerwrap Limited. Link Market Services Limited acted as registrar for Praemium.

Praemium Limited (ASX:PPS) completed the acquisition of remaining 84.9% stake in Powerwrap Limited (ASX:PWL) from a group of shareholders on September 21, 2020. As on September 21, 2020, Praemium has a relevant interest in 92.31% of Powerwrap Shares. As Praemium has a relevant interest in more than 90% of Powerwrap Shares, it intends to compulsorily acquire the outstanding Powerwrap Shares on issue, on the same terms as the Offer. As of September 21, 2020, Praemium has a relevant interest in 94.16% of Powerwrap Shares. The compulsory acquisition process, which is subject to the Corporations Act, is likely to take approximately 4 to 6 weeks, but may take longer in some circumstances. Powerwrap was de-listed from the Australian Stock Exchange on October 6, 2020, with Powerwrap now an unlisted subsidiary of Praemium. As of November 6, 2020, Praemium has completed the acquisition of all the outstanding shares in Powerwrap through compulsory acquisition process. Praemium now owns 100% of the shares on issue in Powerwrap.