MSM CORPORATION INTERNATIONAL LIMITED ACN 002 529 160 PROSPECTUS This Prospectus is being primarily issued for a non-renounceable pro rata offer to Eligible Shareholders of 1 New Share for every 5 Shares held on the Record Date, at an issue price of $0.043 per New Share, together with 1 free Attaching Option for every 4 New Shares issued, to raise approximately $3.67 million ("Entitlement Offer"). The Entitlement Offer closes at 7:00pm (AEST) on Friday, 8 June 2018.* This Prospectus is also being issued for the: • purposes of 708A(11) of the Corporations Act, to remove any trading restrictions on the sale of Shares and Quoted Options issued by the Company prior to the Closing Date of the Offers; • Shortfall Offer; and • Placement Offer. The Offers are lead managed by CPS Capital Group Pty Ltd. THIS IS AN IMPORTANT DOCUMENT AND REQUIRES YOUR IMMEDIATE ATTENTION. IT SHOULD BE READ IN ITS ENTIRETY. IF YOU ARE IN DOUBT ABOUT WHAT TO DO, YOU SHOULD CONSULT YOUR PROFESSIONAL ADVISER WITHOUT DELAY. AN INVESTMENT IN THE SECURITIES OFFERED IN CONNECTION WITH THIS PROSPECTUS SHOULD BE CONSIDERED OF A SPECULATIVE NATURE. * The Company reserves the right, subject to the Corporations Act and Listing Rules to extend the Closing Date for the Entitlement Offer. IMPORTANT INFORMATION This Prospectus is dated 21 May 2018 and was lodged with ASIC on that date with the consent of all Directors. Neither ASIC nor ASX nor their respective officers take any responsibility for the contents of this Prospectus. No Securities will be issued on the basis of this Prospectus any later than 13 months after the date of this Prospectus (being the expiry date of this Prospectus). A copy of this Prospectus is available for inspection at the registered office of the Company at Level 8, 90 Collins Street, Melbourne, Victoria during normal business hours. The Prospectus will also be made available in electronic form. Persons having received a copy of this Prospectus in its electronic form may obtain an additional paper copy of this Prospectus (free of charge) from the Company's registered office by contacting the Company. The Offers contemplated by this Prospectus are only available in electronic form to persons receiving an electronic version of this Prospectus within Australia and New Zealand. Applications for Securities will only be accepted on an Application Form attached to or provided by the Company with a copy of this Prospectus either in paper or electronic form. The Corporations Act prohibits any person from passing on to another person an Application Form unless it is accompanied by a complete and unaltered copy of this Prospectus. No person is authorised to give any information or to make any representation in connection with the Offers in this Prospectus. Any information or representation not so contained may not be relied on as having been authorised by the Company in connection with the Offers. No action has been taken to permit the offers of Securities under this Prospectus in any jurisdiction other than Australia. The distribution of this Prospectus in jurisdictions outside Australia may be restricted by law and therefore persons into whose possession this Prospectus comes should seek advice on and observe any such restrictions. Any failure to comply with these restrictions may constitute a violation of those laws. This Prospectus does not constitute an offer of the Securities in any jurisdiction where, or to any person to whom, it would be unlawful to issue this Prospectus. This Prospectus is important and should be read in its entirety before deciding to participate in the Offers. This does not take into account the investment objectives, financial or taxation or particular needs of any Applicant. The Securities offered by this Prospectus should be considered speculative. Before making any investment in the Company, each Applicant should consider whether such an investment is appropriate to their particular needs, and considering their individual risk profile for speculative investments, investment objectives and individual financial circumstances. Each Applicant should consult their stockbroker, solicitor, accountant or other professional adviser without delay. Some of the risk factors that should be considered by potential investors are outlined in Section 4. This Prospectus includes forward looking statements that have been based on current expectations about future acts, events and circumstances. These forward looking statements are, however, subject to risks, uncertainties and assumptions that could cause those acts, events and circumstances to differ materially from the expectations described in the forward looking statements. Definitions of certain terms used in this Prospectus are contained in Section 7. All references to currency are to Australian dollars and all references to time are to AEST, unless otherwise indicated. Revenues and expenditures disclosed in this Prospectus are recognised exclusive of the amount of goods and services tax, unless otherwise disclosed. i CORPORATE DIRECTORY Directors Lead Manager Mr Adam Wellisch - Non-Executive Chairman CPS Capital Group Pty Ltd Mr Dion Sullivan - Managing Director Level 45, 108 St Georges Terrace Mr Mark Clements - Non-Executive Director Perth WA 6000 Company Secretary Australian Solicitors Mr Mark Clements Bellanhouse Level 19, Alluvion, 58 Mounts Bay Road Registered Office Perth WA 6000 Level 8, 90 Collins Street Melbourne VIC 3000 US Solicitors Telephone: +61 3 9015 4036 Goodwin Procter LLP Fax: +61 3 9666 3301 The New York Times Building Website: www.msmci.com 620 Eighth Avenue New York, NY 10018 ASX Codes: Shares: MSM Quoted Options: MSMOA Auditor* BDO Audit (WA) Pty Ltd Share Registry* 38 Station Street Advanced Share Registry Services Subiaco WA 6008 110 Stirling Highway Nedlands WA 6009 * These entities are included for information purposes only. They have not been involved in the preparation of this Prospectus. ii PROPOSED TIMETABLE Event Date Lodgement of Prospectus with ASX 21 May 2018 Lodgement of Appendix 3B with ASX Option holders notified of Offers Notice of Offers sent to Shareholders 23 May 2018 Securities quoted on an "Ex" basis 24 May 2018 Record Date for determining Entitlements 25 May 2018 Prospectus and Application Form despatched to Eligible 30 May 2018 Shareholders Last day to extend the Closing Date 5 June 2018 Entitlement Offer Closing Date 8 June 2018 Securities quoted on a deferred settlement basis 12 June 2018 Notification of Shortfall 14 June 2018 Issue date of Securities under the Entitlement Offer 18 June 2018 Deferred settlement trading ends Securities issued under the Entitlement Offer commence 19 June 2018 trading on ordinary settlement basis General Meeting 22 June 2018 All dates (other than the date of the Prospectus and the date of lodgement of the Prospectus with ASIC and ASX) are indicative only. The Directors may extend the Entitlement Offer Closing Date by giving at least 3 Business Days' notice to ASX. The Company reserves the right, subject to the Corporations Act, Listing Rules and any other applicable laws, to vary any other date of the Offers, including accepting late Applications, either generally or in particular cases, without notice. iii LETTER TO SHAREHOLDERS Dear Shareholder Entitlement Offer On behalf of the Directors of MSM Corporation International Limited (Company), I am pleased to invite you to participate in a non-renounceable pro rata 1-for-5 entitlement offer at an issue price of $0.043 per New Share to raise approximately $3.67 million (before costs) (Entitlement Offer). Participants in the Entitlement Offer will also be issued with one free Attaching Option for every four New Shares subscribed for. The Attaching Options are intended to be quoted and exercisable at $0.10 each on or before 7 November 2019, on the terms set out in this Prospectus. The Entitlement Offer will only be made to Eligible Shareholders registered at the Record Date who will be sent an Application Form which will be accompanied by this Prospectus. To accept your Entitlement under the Entitlement Offer, you will need to complete the Application Form in accordance with the instructions on the form and as outlined in this Prospectus. The Entitlement Offer is lead managed by CPS Capital. Refer to Section 5.4 for details regarding the lead manager's mandate with the Company. The Company has entered into a number of agreements with strategic investors to take up to approximately $3,397,000 worth of the Shortfall. If there is insufficient Shortfall to satisfy these agreements, the Company intends to issue the balance of these Securities to the strategic investors as a placement. The Company has also received commitments from Eligible Shareholders to apply for $276,344 of their Entitlements. As a result of these commitments and the agreements with the strategic investors, the Company has received commitments to subscribe for the full amount offered under the Entitlement Offer. Refer to Sections 1.2, 1.3 and 5.3 for further details. All Directors intend to take up all or part of their Entitlement under the Entitlement Offer. Use of funds The funds raised under the Offers are intended to be used primarily for the following purposes: • ongoing improvement, marketing and operation of the existing competitions being operated by the Megastar platform, namely, the "Megastar Spotlight" and "Live Lightning" competitions; • establishing the Megastar India joint venture with Riva Digital FZ LLC; • establishing Megastar joint ventures in additional markets; • establishing content distribution agreements; • legal and accounting costs to qualify the Company's United States subsidiary, MSM Music, Inc. (MSM-US) under Regulation A (commonly referred to as "Reg A+") of the US Securities Act, with the intention of MSM-US undertaking strategic capital raisings in the United States from accredited and non-accredited investors; • marketing in connection with the proposed strategic capital raisings within MSM-US; iv • researching, partnering/acquiring and developing products that will drive users and or revenue to the Megastar platform; and • repayment of short-term loans, general working capital and the costs of the Offers. Please refer to Section 1.8 for further detail regarding the proposed use of funds to be raised under the Offers. It is intended that the majority of the expenditure incurred in connection with the restructuring of MSM-US and the strategic capital raisings within MSM-US will be reimbursed to the Company following completion of the MSM-US capital raisings. There can however be no certainty that the capital raisings undertaken by MSM-US will be successful and there is a risk that this expenditure may not be reimbursed. For further information regarding the Company's strategy, in particular with respect to the strategic capital raisings in MSM-US, please refer to the Company's announcement of 21 May 2018. Prospectus The Prospectus includes further details of the Offers and the effect of the Offers on the Company, and a statement of the risks associated with investing in the Company. This is an important document and should be read in its entirety. If you have any doubts or questions in relation to the Prospectus you should consult your stockbroker, accountant, solicitor or other independent professional advisor to evaluate whether or not to participate in the Offers. On behalf of the Board, I encourage you to consider this investment opportunity and thank you for your ongoing support. Yours faithfully Mr Adam Wellisch Non-Executive Chairman v INVESTMENT OVERVIEW This Section is intended to highlight key information for potential investors. It is an overview only, and is not intended to replace the Prospectus. Potential investors should read the Prospectus in full before deciding to invest in Securities. Key Information Further Information Transaction specific prospectus Section 5.5 This Prospectus is a transaction specific prospectus for an offer of continuously quoted securities (as defined in the Corporations Act) and has been prepared in accordance with section 713 of the Corporations Act. It does not contain the same level of disclosure as an initial public offering prospectus. In making representations in this Prospectus regard has been had to the fact that the Company is a disclosing entity for the purposes of the Corporations Act and certain matters may reasonably be expected to be known to investors and professional advisers whom potential investors may consult. Risk factors Section 4 Potential investors should be aware that subscribing for Securities in the Company involves a number of risks. The key risk factors of which investors should be aware are set out in Section 4, including (but not limited to) risks in respect of: • Additional requirements for capital: Further funding will be required by the MSM Group to support its ongoing activities and operations. There can be no assurance that such funding will be available on satisfactory terms or at all. • Attracting, retaining and engaging consumers: The success of the Company's business depends on the MSM Group's ability to attract, retain and engage consumers, of which there can be no certainty of success. • Maintenance of key, influential business partner relationships: The MSM Group relies on relationships with key, influential business partners to enable it to run contests and further develop the Megastar platform and its business expansion strategies. There can be no assurance that such relationships will continue or that the MSM Group may be able to readily procure alternates should such relationships be terminated. • US capital raising: The MSM Group is proposing to undertake a two- stage capital raising in the United States. The first stage is proposed to be undertaken pursuant to Rule 506(c) of Regulation D under the US Securities Act. The second stage is intended to occur under Regulation A+ of the US Securities Act. There can be no certainty that the MSM Group may be able to satisfy the legal and regulatory requirements to undertake these proposed capital raisings. There can also be no certainty that the capital raisings will be successful. • Token risk: The MSM Group is investigating the potential for the creation, issuance and exchange of a form of digital security in the United States which may be utilised within the Megastar platform owned and operated by MSM-US. The legal and regulatory regime governing the issuance and exchange of digital securities is a vi Key Information Further Information complex and evolving area, and subject to uncertain interpretation. Although the Company has no reason to believe that MSM-US will not be able to comply with the current laws and regulations and obtain any regulatory approvals as and when required, there can be no certainty. • New market risks: The MSM Group is seeking to expand its business into additional jurisdictions and types of contests, as well as products complementary to the MSM Group's existing business. There can be no certainty that the MSM Group's product offerings will meet the needs or demands of these new markets. New markets usually cost substantially more to penetrate than a known market and may also result in a diversion of the attention and time of management. Accordingly, such efforts may have a materially adverse effect on the value and prospects of the MSM Group. • Reliance on key personnel: The loss of any key person or the inability to find new key persons could have a material adverse effect on the business. • Third party competition: A rival product offering or technology developments by competitors may have a materially adverse effect on the prospects of the Company. • Intellectual property risks: The MSM Group's intellectual property rights are critical to its success. Unauthorised use or restriction of its intellectual property rights may result in an adverse effect on the Company. The MSM Group may also experience conflict with third parties who may contest intellectual property rights. Entitlement Offer Section 1.1 This Prospectus is for a non-renounceable entitlement issue of one New Share for every five existing Shares held by Eligible Shareholders on the Record Date at an issue price of $0.043 per New Share to raise up to approximately $3.67 million (before costs). Participants in the Entitlement Offer will also be issued with one free Attaching Option for every four New Shares issued. Eligible Shareholders Section 1.18 and 1.19 The Entitlement Offer is made to Eligible Shareholders only. Eligible Shareholders are those Shareholders who: • are the registered holder of Shares as at 7.00pm (AEST) on the Record Date; and • have a registered address in Australia or, subject to the offer restrictions in Section 1.19, New Zealand. Underwriting Sections 1.6 and 5.4 The Entitlement Offer is not underwritten. CPS Capital Group Pty Ltd is the Lead Manager of the Offers. Shortfall Offer Sections 1.6 and 1.2 The Directors reserve the right to issue and allocate Shortfall Securities at their absolute discretion within the three month period following the vii Key Information Further Information Entitlement Offer Closing Date. Eligible Shareholders may not apply for Shortfall unless invited by the Directors. The Company has entered into firm commitment agreements with the Placement Subscribers to subscribe for an aggregate of 79,000,000 Shares and 19,750,000 Quoted Options (Committed Placement Securities). It is intended that the Committed Placement Securities will be issued as part of the Shortfall Offer to the extent that there is sufficient Shortfall. Placement Offer Section 1.3 To the extent that there is insufficient Shortfall to issue the Committed Placement Securities in full, the balance is intended to be issued by the Company pursuant to the Placement Offer. Use of funds Section 1.8 Funds raised under the Offers are intended to be used for: • ongoing improvement, marketing and operation of the existing competitions being operated by the Megastar platform, namely, the "Megastar Spotlight" and "Live Lightning" competitions; • establishing the Megastar India joint venture with Riva Digital FZ LLC; • establishing Megastar joint ventures in additional markets; • establishing content distribution agreements; • legal and accounting costs to prepare offering materials for private placement under Regulation D of the US Securities Act and to qualify MSM-US under Regulation A+ of the US Securities Act, with the intention of MSM-US undertaking the US Capital Raising; • marketing in connection with the US Capital Raisings; • researching, partnering/acquiring and developing products that will drive users and or revenue to the Megastar platform; and • repayment of short-term loans, general working capital and the costs of the Offers. Effect on control of the Company Sections 1.9 and 1.10 Shareholders should note that if they do not participate in the Offers, their holdings will be diluted. No party will hold a voting power greater than 20% as a result of the Offers. viii Key Information Further Information Indicative capital structure and pro-forma balance sheet Sections 1.4, 3.1 and 3.2 The indicative capital structure upon completion of the Offers is set out below (subject to rounding): Shares Quoted Options Balance at the date of this Prospectus 427,132,981 65,880,548 To be issued following the General Meeting1 Nil 32,000,000 To be issued under Entitlement /Shortfall Offers2 85,426,596 21,356,649 To be issued under Placement Offer3 Minimum4: Nil Nil Maximum5: 79,000,000 19,750,000 TOTAL Minimum6: 512,559,577 87,237,197 Maximum7 591,559,577 138,987,197 : The Company also has 19,900,002 unquoted Options, 24,300,000 Performance Rights, and 100,000,000 Performance Shares on issue as at the date of this Prospectus. The indicative pro-forma balance sheet showing the effect of the Offers is in Section 3.2. 1 Assumes the necessary Shareholder approvals are received at the General Meeting and the Quoted Options are duly issued following the General Meeting. The Quoted Options are to be issued to participants in the February 2018 Placement and the Lead Manager. Refer to the Notice of General Meeting for further information. 2 Assumes that no Securities are issued, exercised or converted prior to the Record Date and that the Entitlement Offer/Shortfall Offer is fully subscribed, and is subject to rounding. 3 Shareholder approval is being sought for the issue of the Committed Shortfall Securities pursuant to the Placement Offer at the General Meeting. If the necessary Shareholder approvals are not received, the Company intends to issue the Committed Shortfall Securities pursuant to the Placement Offer pursuant to the Company's placement capacity under Listing Rule 7.1 as and when available. 4 Assumes the Committed Placement Securities are subscribed for in full under the Shortfall Offer. 5 Assumes the Entitlement Offer/Shortfall Offer is subscribed for in full, and the Committed Placement Securities are subscribed for in full under the Placement Offer. Subject to rounding. 6 Assumes the Committed Placement Securities are subscribed for in full under the Shortfall Offer and that the necessary Shareholder approvals are not received at the General Meeting or the Quoted Options are not issued for any other reason. Subject to rounding. 7 Assumes the Entitlement Offer/Shortfall Offer is subscribed for in full, the Committed Placement Securities are subscribed for in full under the Placement Offer and the necessary Shareholder approvals are received at the General Meeting and the Quoted Options are duly issued following the General Meeting. Subject to rounding. ix