INVESTORNEWSA P R I L 2 0 1 9

Experienced Funds Manager Joins Angas Securities Board to Drive Investor ValueRandal Williams accepted an offer to join the Angas Securities board of directors, effective 1 March 2019. Mr Williams is a highly experienced financial services lawyer and senior executive who is the current Managing Director at Melbourne private investment and consulting firm T C Wollaston & Co. He previously held several key roles during a fifteen year career at La Trobe Financial Services (“La Trobe”) in Melbourne. In his time at La Trobe, its funds management business grew from approximately $1 billion in 2003 to around $7 billion in 2018.As Chief Wealth Officer for La Trobe, Randal managed all aspects of the La Trobe Australian Credit Fund, including the design and updating of its Product Disclosure Statement. Randal then joined the Senior Executive Committee upon being appointed Chief Lending Officer. He was engaged in all aspects of loan origination, loan approval and loan settlement at La Trobe. He re-structed the Lending Department along functionality lines and developed a model for resourcing according to workloads and competencies. Randal managed relationships with mortgage brokers, solicitors and valuers.

Most recently, Randal held the role of Chief Risk Officer managing all risk and compliance matters, managing the internal audit function, insurance and staff training. He continued as a member of the Senior Executive Committee. In this capacity, as Chief Risk Officer, Randal successfully participated in the team that eventually saw 80% of La Trobe Financial sold to the Blackstone Group from New York in December 2017. His role in the process included providing, to the satisfaction of Blackstone and its legal and accounting advisors, all Due Diligence material in relation to risk, compliance, internal audit and insurances.

Angas Securities Executive Chairman Andrew Luckhurst-Smith said that Mr Williams’ appointment was a vote of confidence in the Angas Prime funds management business. Being able to draw on Randal’s significant

experience in risk and compliance complements Angas Prime’s current executive team and equips us with the necessary capability to target further sustainable growth."

"Randal possesses a deep understanding of the Victorian real estate market, which will be particularly beneficial as Angas looks to expand its interstate footprint.” Mr Williams said that he was drawn to the Angas Prime’s strong funds management business model and welcomed the opportunity to join such an experienced and knowledgeable team. “Based on my experience Angas Prime is a strong product with fantastic growth potential” he said.

“I have enormous respect for the current board and their acumen, and I believe that I will be able to offer an additional level of insight and expertise that will ensure Angas Prime’s funds management business continues its strong upward trajectory.”

The appointment of Mr Williams in a non-executive role will aid the transition of Angas Securities as an outright funds manager. Angas Prime is an established retail mortgage trust. A graduate in both Law and Commerce amongst a range of tertiary degrees, Mr Williams also holds mortgage and finance industry qualifications. Mr Williams said that he was drawn to the strong funds management business model of Angas Securities and welcomed the opportunity to join such an experienced and knowledgeable team.

Randal Williams

INVESTOR SERVICE LINE 1800 010 800

ANGAS PRIME

Its principal activities are to: -

Raise funds from various sources but primarily direct from retail investors seeking regular return on capital or from wholesale institutional sources.

Source and process applications for mortgage loan advances according to prudential guidelines.

Administer loans including collection of interest and principal, management of mortgage security and instructing solicitors, valuers and agents as required.

It is the policy of Angas Prime to only lend to corporate entities rather than to personal individuals. A typical loan is almost always in excess of $0.5 million. Angas Prime loans are strictly for business purposes and Angas Prime borrowers warrant that such is the case. Angas Prime borrowers are typically commercial operators with many years experience dealing with commercial lenders and are well used to driving a commercial outcome. Angas Prime is a first registered mortgage lender (no second mortgages). Typically, Angas Prime lends to borrowers for a term of one year with interest pre-paid for the term of the loan. This feature is essential to enable borrowers time to bring their real estate product to the market. Loans will only be extended if the value of the security warrants such an extension and other conditions set by Angas Prime have been met.

Angas Prime strongly supports a regulated financial system. It is true that regulation involves cost, can restrict flexibility in many instances and can prevent innovation. But a licence to operate a financial services business is very valuable. Angas Prime could not operate as a commercial lender were it not for the rule of law. Regulation provides a barrier to entry which benefits existing participants who have met the establishment and ongoing costs of compliance. The regulatory barriers to commencing a financial services business in 2019 are vastly greater than applied when Angas Securities was first established nearly 20 years ago. A competitive financial system will deliver benefits for the broader community. Competition will deliver greater opportunities for both investors in financial products and consumers of the funds invested such as borrowers.

Since its establishment on 29 March 2000, Angas Securities has specialised in raising funds from the public for investment in first registered mortgages over real property. There remains strong demand for the funding of commercial property loans within the qualitative lending parameters that Angas Prime requires. Borrowers who

take out loans from Angas Prime are often those who do not deal with traditional lenders such as banks or who may not meet the lending criteria of such lenders. Business proprietors, self-employed borrowers or investors in property that does not generate income are amongst the class of typical Angas Prime borrowers. As an asset based lender, Angas Prime places primary reliance on the first mortgage security that is held. Angas Prime can and does sell that security to obtain recovery of loan advances if a borrower defaults. This is done by Angas Prime acting as mortgagee exercising power of sale.

Angas Securities holds AFSL number 232479 issued by ASIC to act as the responsible entity of Angas Prime. As an AFSL holder, Angas Securities must meet all legislative requirements including those as to capital and reporting. Angas Prime selects a range of securities and sets the loan to value ratio for each security. The Angas Securities Board of Directors determines the tolerance for risk of Angas Prime after taking into account the strategic objectives of the Fund and other factors including investor expectations. Angas Prime is responsible for ensuring material risks have been identified and appropriate and adequate control monitoring mechanisms and reporting are in place. Angas Prime’s management is required to analyse the business risk in the context of Board expectations, specific business objectives and risk tolerance. The appointment of Randal Williams to the company’s Board of Directors will drive value for investors.

Angas Securities offers investors financial products managed by a Board with complementary skills, comprising two Executive Directors and two Independent Directors, an appropriate management structure composed of experienced personnel, support being provided to management by way of additional resources from external consultants, to enable a strict focus on the core business of Angas Prime, minimisation of financial risk through an audited statement of financial position and appropriate operating controls and a sound understanding of the legal and compliance environment in which Angas Prime operates.

Delivering Value to Private Investors

Please feel free to contact the investor relations staff at Angas Securities on 1800 010 800 or by visiting the Angas Securities offices in Adelaide, Sydney and Perth. You may request an Angas Prime Product Disclosure Statement free of charge. There is no obligation to invest.

Angas Prime conducts business as a mortgage financier.

www.angasprime.com.au

ANGAS PRIME

What is a mortgage trust?

Under Angas Securities’ previous fixed-interest-security model (formerly referred to as “debentures”), an investor would make a secured loan to Angas Securities. “Debenture” simply means “secured loan”. Angas Securities became the legal and beneficial owner of that money, subject to a legal obligation to repay the money to the investor with a fixed interest coupon. Significantly, ownership of the money passed from the investor to Angas Securities. Under a mortgage trust, there is no transfer of ownership. The money invested in Angas Prime remains in the ownership of the investor. It is pooled with money owned by other investors and invested in mortgages originated and managed by Angas Prime.

What do you mean when you say that Angas Prime is “unitised”?

Investors share in the income generated from Angas Prime in proportion to their investment. Angas Prime is unitised, meaning an investor is issued with units in the fund with a face-value of $1.00 per unit. Each investor’s interest in Angas Prime is a fractional and beneficial interest in the whole of the fund. It is not an interest in any particular investment of Angas Prime or in any specific Angas Prime asset.

What is a “managed investment scheme”?

This is a statutory structure introduced by amendments to the Corporations Act in 1999. Angas Prime was established in 1984 and operated for 15 years under general trust law. That law still stands today but specific law now applies to managed investment schemes, including this mortgage trust. It is designed to protect investors and ensure that the mortgage trust is operating honestly and efficiently.

What is a “product disclosure statement”?

The traditional Angas Securities investment product required a prospectus to be lodged at ASIC and updated every year. The prospectus regime does not apply to a managed investment scheme. Instead, Angas Prime has a product disclosure statement (PDS). The PDS sets out the terms and conditions of the investment, including disclosure made against the benchmarks and disclosure principles in ASIC's Regulatory Guide 45.

What do you mean by “target rate”?

Angas Prime is not a fixed-interest investment. Angas Prime provides investors with a target rate of return from a pool of loans secured by registered first mortgages. Investor monies are pooled together and invested collectively. Each investor has a proportionate share

in the entire mortgage portfolio rather than a specific interest in any particular Angas Prime mortgage. Angas Prime does not warrant to deliver a fixed-rate of return. Angas Prime has a target rate. The ability to achieve this target rate is enhanced through the use of a dedicated reserve account. This means that Angas Prime does not have to rely solely on borrower performance in order to meet its distributions to investors each month.

What are “income distributions”?

Angas Prime distributes income to investors. It does not pay interest. Income is paid to investors by direct credit to the investor’s nominated bank account monthly. Income distributions are not guaranteed.

What is Angas Prime’s investment term and how do I withdraw my investment?

An investor’s initial investment will be available for withdrawal 12 months from the end of the month in which it was lodged. For example, an investment lodged on 7 June 2019 will be available for withdrawal on 30 June 2020. Each investor has a right to make a withdrawal request at the end of each 12-month period. An investment will be rolled automatically for a further 12-month investment period unless prior notice is given to Angas by the investor in the manner prescribed in the product disclosure statement.

What is the “dedicated reserve account”?

Angas Prime will maintain a dedicated reserve account in order to support distributions and meet capital losses on individual assets that Angas Prime may incur from time to time. Any funds in the dedicated reserve account as at 30 June each year will be distributed to Angas Securities.

Investor Questions

Pater Latzel, Accountant Simon Thompson, Chief Financial Officer and Jeffrey Hill, Administration Officer

REGULATORY ADVICEThe investment offer is contained in the current Product Disclosure Statement (PDS) which should be read carefully before investing. An investment in Angas Prime is not a bank deposit. There is a risk you could lose some or all of your principal and that you may receive lower than expected returns. There are certain limitations on your ability to withdraw from the Fund and withdrawal requests may take up to 12 months to process.

IMPORTANT NOTICEThis newsletter does not contain investment advice. You should carefully consider the content of our disclosure document and seek advice from your own qualified financial adviser. This newsletter contains general information only and does not take into account your individual objectives, financial situation or needs.

INVESTOR SERVICE LINE

1800 010 800

ANGAS PRIME

6.5%TARGET RATE P.A. | INCOME PAID MONTHLY

VISIT WWW.ANGASPRIME.COM.AU | INVESTORRELATIONS@ANGASPRIME.COM.AU

Angas Securities LimitedACN 091 942 728

Australian Financial Services Licence No 232 479

ADELAIDELevel 14, 26 Flinders Street,

Adelaide SA 5000

GPO Box 2948, Adelaide SA 5001

Phone 08 8410 4343 Fax 08 8410 4355

SYDNEY3 Spring Street,

Sydney NSW 2000

PO Box R1835, Royal Exchange NSW 2000

Phone 02 9259 0777

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Subiaco WA 6008

PO Box 1602, Subiaco WA 6904

Phone 08 9380 4983 Fax 08 9380 4480